Politics and Economics

In a nutshell, Gunnar Tómasson has managed to capture the problem with trying to bring politics into economics:
There is no guarantee that coherent monetary analysis will accommodate anybody's political views. So there are two ways to go -

1. Put political views aside while clarifying one's thinking on monetary issues;
or
2. Put analytical considerations aside to accommodate one's political views.
But one can't go both ways at once.

Making Economic Life Visible

In its relationship to economic life, humanity suffers from a condition which is akin to schizophrenia. There is, on the one hand, a near obsession with things economic, the cost of living, price-busting deals, stock values, interest rates, incomes and the like, such that one might imagine that in economics one could find the real source of human motivation and inspiration. On the other hand, economics induces a kind of phobia or soul aversion if one wants not to talk around the subject, but go directly into the concrete details. For all that one might pretend that economics is merely a technical and abstract representation of money processes, underneath we must know that it reveals something about us, as soon as it stops being ‘out there’. This alerts one to a place in human soul life that, if possible, one prefers not to visit.

Economics is not mysterious, it concerns human deeds and human relationships, represented in a financial language, bookkeeping, which is a way of making conscious what would otherwise stay in a subjective form, or not be made visible as a picture. Behind bookkeeping stand transactions and in these a whole story can be traced.
If I ask you what you think is important in life, you will probably give me an answer of a philosophical kind, wishful to some degree, but examine your current account statements through a whole year and you will find where your motivation took you, where your priorities lay. Draw up a balance sheet which records everything that belongs to you and all that you owe, your assets and your liabilities, and you will most likely be able to experience a new kind of awareness of your situation in life, a photographic financial snapshot of what kind of economic vehicle you are in, for which you are responsible. Hence at its most basic level, economics is about revealing what, if one does not attend to it, remains veiled: the world of finance, which, whether one concerns oneself with it or not, has a direct and not always welcome influence on life. To describe and make comprehensible the world of finance is the task of the economist.

Of course, one might argue that to engender such clarity, and face economic life with it, is the task not just of the economist, but of every human being responsible for a business or indeed any organisation for which accounts are produced. What is economics but such activity taken together and made visible such that the human being can come into a conscious relationship with it and give it direction?

In this sense economic life is manageable, as a shared endeavour among those responsible for it, whether they be self-employed or directing large organisations, the tools are the same, the income and expenditure account and the balance sheet; as is the technique, to forecast the budget, record the actuals and note the difference. When human beings come together to do this they bring within their ken the pulse of economic life.

Such is the logic of associative economics, making visible and conscious what markets economics keeps instinctive and veiled.

The Talking Economics weblog, a venue for musings on the associative economy.