Fwd: Re: Finance and Economics after the Dotcom Crash

[kwalker2 at gte.net]

if doug or others would care to respond... i posted geert's interview with 
doug to the FoRK list <fork at xent.com> last i knew, they kept the list open 
so nonsubscribers could post. if you address it to the list, it'll hit the 
list, and anyone who responds will CC you, doug (or others). They do this 
on purpose since they've had interesting debates with people over the 
years-- people who might not want to sub to an active list just to 
participate in a one time only debate.

below are two responses.


>From: "Russell Turpin" <deafbox at hotmail.com>
>To: fork at xent.com
><...>
>I enjoyed reading that. Thanks for posting it. I cannot
>resist making one comment on the substance.
>
>Doug Henwood says:
>>I'd also like to make the point that there's something
>>illusory and fetishistic about the very notion of retirement funds. 
>>Individuals or families can save for a while, then draw down their 
>>savings, but societies
>>as a whole cannot. Today's retirees can't be sustained using yesterday's 
>>savings - the money has to come from
>>today. Effectively, today's stock buyers are what fund today's stock
>>sellers. Just like a public pension
>>system, a private one depends on  the cross-generational
>>transfer of funds from workers to retirees.
>
>That is one of the most wrong-headed economic claims I
>have ever read! It completely ignores what constitutes
>economic progress: that the current generation is NOT
>beginning from scratch, but is working on a foundation
>of accumulated capital, which interpreted broadly, is
>the entire economic infrastructure, including the
>knowledge distributed in the economic system, and the
>knowledge held in the new generation's heads. This base
>is provided by the previous generations' savings and
>investment. Societies can and do save, in much the same
>way an individul or family does. That is such a
>critically important aspect of economic history that it
>completely flabbergasts me that someone writing on
>finance would miss it.
>
>Russell


>From: ThosStew at aol.com
>Message-ID: <4d.166ad11e.2954b82c at aol.com>
>Date: Fri, 21 Dec 2001 11:07:08 EST
>Subject: Re: Finance and Economics after the Dotcom Crash
>To: FoRK at xent.com
>
>In a message dated 12/21/2001 10:36:26 AM, "Russell Turpin" 
><deafbox at hotmail.com> writes:
>
> >That is such a
> >critically important aspect of economic history that it
> >completely flabbergasts me that someone writing on
> >finance would miss it.
>
>
>Probably because of his Marxism. Marxism's fundamental flaw, IMHalf-bakedO,
>is that it ignores the roles of innovation and knowledge as assets and
>factors of production. The logic of the Marxist critique of
>capitalism--especially the inevitability of trusts and monopoly, the
>pre-condition for the radicalization of the urban proletariat--works only in
>an economy where innovation is minimal. Big organizations repress
>innovation--not only do they try to repress it from rivals, they try to
>repress it internally.  If they're not threatened, big companies fall behind
>the curve technologically. (Vide  companies in protectionist countries.)
>Innovation disrupts monopoly, and either forces big companies to wake up, or,
>more often (and with sporadic help from antitrust laws), undoes the hegemons.
>My very-much-armchair intellectual-historiographical hypothesis would be
>this. Marx--a superb  observer of social reality--saw how the rural peasantry
>was uprooted and moved into the cities, which were squalid, dirty places,
>alienated of ownership or influence over the means of production.Marx's early
>writings on this stuff are wonderful. The first half of the 19th century in
>Britain was a terrible time--the industrial revolution was built on the backs
>of two generations of Englishmen, an historian said. Later Marx saw how the
>industrialists worked and thought (and still do: We/they all want to
>eliminate competitors). He put those together, but then his imagination lead
>him down the wrong road--into the inevitability of a revolution led by the
>urban proletariat, which never happened anywhere, etc., rather than a road
>that saw how the very rise of a technological economy would add a potent new
>factor of production: science/innovation/new business formation. Why the
>failure? Maybe because he analzyed the newly industrialized world with an
>economic logic unwittingly distorted by the assumptions he grew up with,
>which were those of the pre-industrial,  ancien regime, where innovation was
>not a major factor of production or economic structure. There was a "new
>economy" in 1850, and Marx got it--but only half of it.
>
>tuppence,
>
>Tom