Economics has precedence over all other human endeavors. This is not a ranking or a value judgement; it’s a statement of fact. Economies, or the production, allocation and distribution of surplus goods (to survive), determines who is given the freedom to pursue alternative enterprises.
Every art installation, every monument, every scientific advance, every aspect of human culture not directly necessary for basic survival was enabled by surplus production. When art is commissioned from an artist, the artist is free to paint, sculpt, compose… and need not find other means of generating (survival) income. When publicly funded grants or privately funded awards are allocated to scientists, they are free to pursue their scientific interests (discover new drugs; untangle the nature of the universe; identify physical systems supporting life on Earth). Their time devoted to science and not to other (survival) income generating work. The same applies to architects; but get this, it also applies to the builders. Think about farmers of ancient Egypt; they were so good at producing foodstuffs that they were able to generate enough (surplus) to feed the laborers who built the pyramids. If those farmers were less efficient, it is likely that a number of builders would have had to farm for a living. As it turns out, ancient Egypt had the surplus production to support the construction of many monuments.
When the rise and fall of civilization(s), society(ies) and culture(s) is viewed through through the lens of the allocation of surplus production, it becomes evident that human achievement is an emergent property of economics. And the emergence of complexity is more important than ever before as today’s technology laden economies rely ever more on robust physical and intellectual infrastructures to meet the needs and demands of an ever growing global population.
But the economy is not working for many Americans. Our life expectancy and quality of life are declining; our infrastructure is in a state of collapse and our institutions of high learning under increasing stress. Indeed, there are far more examples than space and time can accommodate.
Here the emergent properties of economies will be used to highlight the systemic flaws of today’s economy. Understanding these flaws is key to developing an economy which serves all people, not just the rich and powerful.
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[This an immediate continuation of a series describing a new way to look at the economy. Because many concepts were introduced in earlier parts, it would be useful to read them first:
Econology Part 1a: It's not the economy, Stupid; it's economics
Econology Part 1b: The depth and breadth of economies
Econology Part 2: The ecology of economies
Econology Part 3: Eleven economics lessons from ecosystems]
The systemic flaw of today’s economy is capitalism. To understand this, consider the water cycle in its most basic form. Figure 1 depicts the geochemical water cycle of the planet which accounts for most of the water which cycles through the environment.
Biological entities have evolved mechanisms to capture and retain water through this inorganic cycle to sustain themselves (Figure 2).
As the mass of biological organisms increased and new forms evolved, ecological communities emerged (Figure 3) along with biological mechanisms to stabilize local water cycles.
As human societies evolved, we harvested the fruits of the water cycle (by hunting and gathering) and learned to make use of the cycle (domesticated agriculture) to develop modern economies (Figure 4). And had economies followed the basic tenets of terrestrial (land) ecosystems, we would likely not currently be in a state of economic and social turmoil.
When economic systems are imposed onto economies, the powers that be presume to know how the interplay of social, cultural and economic relationships meld into a functioning stable economy. What they did not understand is the most productive, stable and resilient economies are ecosystems which consists of an astonishing array of biological relationships including antagonistic, competitive and mutualistic. The full measure and complexity of these interactions is key.
Capitalism is the economic variant of predation which empowers capitalist owners through the rights and privileges conferred by private ownership. Within legal constraints, owners are free to extract productivity from their workers. In the past, owners had a sense of stewardship derived from the passage of land and property through generations of the same family. In the U.S., relaxed familial obligations, mobility and ease of property transfer has eradicated this principle and reinforced the practice of investing/owning solely for short term gain.
An example of the disastrous effects of short term profit driven economic policy resulted in the Dust Bowl and contributed to the Great Depression. Prior to the advent of commercial agriculture, the Great Plains had a complex stable, productive and self-sustaining ecosystem comprised of plants and animals that were adapted to a temperate grassland biome (Figure 5).
Transplanted European farmers co-opted these vast fertile vistas into profit generating cereal farms (Figure 6)…
… and for a number of years, they were quite successful (Figure 7).
However, domesticated cereal crops and mechanized farming practices did not stabilize and preserve the soil like the native grasses with their mat roots (Figure 8).
Soil, in combination with vegetation, retains water in local ecosystems to help maintain a life sustaining water cycle. On thin soil, cereal crops were unable to grow, store and retain enough water to maintain the regular water cycle (Figure 9) triggering the droughts of the Dust Bowl.
The result was a human created environmental disaster: the deliberate, if inadvertent, desertification of the Great Plains, leading to the collapse of farm economies in multiple states. The loss of farm income set in motion the largest mass migration in American history.
continued... here (Econology Part 4: Emergent flaws of Capitalism, part 2).
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