Is globalization behind the recession?

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Well, there were multiple justifications. I think the real reason why his high wage policy worked was because it attracted higher quality applicants, improved management-labor relations, and reduced turnover. I don't think that the explanation of increasing demand makes sense at all, and Henry Ford was likely making up an ad hoc rationalization for his own personal desires to pay workers more when he made that argument, as he wanted to pay workers more as a matter of his ethics, he was not just making a calculating business decision.

I'm sure that some narrowly focused economic studies have been quite illuminative - especially on the micro-economics scale. But when it comes to macroeconomics, there is close to zero agreement between economists on the most essential questions (like the business cycle, causes of a recession/depression, responses to a recession/depression, etc). When it comes to these issues, the different camps really do look political parties or theological camps (and often are).

Having a focus on math is not inherently good nor bad. If it leads to an understanding that is more consistent with reality, and which offers a better predictive model, that could be good. But what passes for math in economics (Laffer curve, the formula for valuing credit default swaps) has not proven itself useful, or is outright dangerous.



I'm not the least bit catholic, but will credit that church for consistently raising questions about the fact that economic systems in place around the world have serious flaws. This 'joke' raises a fundamental issue relating to capitalism and human behavior, and to dismiss because you don't like the person who is speaking is a retreat to the ivory tower. Which is typical of academic economists - why deal with the hoi polloi, when other academic economists and carefully screened members of the business community are the target audience, right?

The ethical problem hinted at in the above joke (and your response) points to capitalism as a conspiracy of exploitation - businessmen are nothing more than vassals that have pledged their allegiance to the barons of money, and are 'morally' obligated to milk the serfs for as much as they can. Such attitudes end up in opposition to the practice of good community, and human dignity.

Politicians don't set the economy. Private individuals (the Federal Reserve Bank and it's owners) do. In every depression, you'll find the top tier money people always make a killing because they either know what's going to happen and keep that information to themselves or they engineered the events so they could make profit off of it.

I thought there was a term coined for that kind of thing, it's criminal.... Called insider trading, is it not? <.< When you know information and act so it profits you before it hits the rest of the population.

There were people calling for a major recession to be triggered as a way to safeguard American power in the world - that is, a recession would hit the commodity markets that helped Russia, Venezuela, Iran and other hated countries do well...

Well, yes, but macroeconomics is the newer field of economics and there are still methodological issues that are being hammered out, and even then I wouldn't say it is purely theological given that change in the field does happen.


Most economists don't put much value in the Laffer curve, and I've only seen it on an AP economics test, but never in an economics class. I think that the math minded economists view the laffer curve more negatively than most as well, but I can't find the source I was thinking of.


Umm.... it somewhat does raise questions, however, I did offer a response, and THEN I said I didn't like the Pope. That is different than just retreating to the Ivory Tower, as I certainly have a reason to view the Pope's question as pointless, and on top of that, I see the Pope as likely not adding much to the debate. In any case, yes, I do agree with academic economists not dealing with the average person, simply because there would likely be too much of an understanding gap, as people are not just ignorant of the workings of economics, but they likely think they know something that disagrees with basic economic theory, and trying to get to the point where this can be dealt with is a pain.


I don't see it as a conspiracy. I mean, yes, businessmen are nothing more than vassals that have pledged their allegiance to barons of money, and are morally obligated to milk the serfs for as much as they can. However, milking the "serfs" under a capitalistic system is different than under a feudal system, as capitalism works by voluntary exchange, so for the businessmen to milk the serfs isn't necessarily a bad thing. I mean, I don't see a major problem with Milton Friedman's view of corporate responsibility, which is explicit on the role of businesses and business men.

In any case, I don't see how such an attitude really has any opposition. I mean, good community consists of people, and businesses are not people, and so I don't see the problem on that grounds, as people still can band together to act towards a common cause without regard for most corporate actions. Not only that, but "human dignity" is a rather squishy term where people have markedly different views on the matter.

The word 'conspiracy' comes from "to breathe together" - people tune into the same patterns, and act as one. Not all conspiracies are evil ... but by your own admission, business is amoral.

Most businesses take the stand that if something is not illegal, it is ok. Thus we have tobacco companies conspiring to addict and cut short the lives of millions of people for the benefit of their shareholders. Thus we have predatory lenders who set up shop in poor neighborhoods to suck what little money is there. Thus we have food processors feeding people trans-fats and excess fructose while trying to dodge responsibility for the health consequences. And of course, people will shut down factories and put their neighbors out of work because greater profits are possible by shipping the factory somewhere else.

Good community consists of people? No, good community consists of people who conspire for common benefit. If they are good only in the evenings and weekends, and then put on their business hat and abandon all concerns for non-stockholders during the normal day, they are working at cross purposes ... and the business entity probably has greater resources and coordination, which amplifies the effects of their amoral conduct.

Well, such a crime applies to direct investors and those who work in the stock market...specifically in knowing things that would make specific stocks go up or down. That captains of industry should choose to manipulate economic forces to make a desired result take place, I don't know.

The heads over the Federal Reserve can choose to pursue an economic policy that will collapse the economy and knowing their plan, move their assets into stable formats that will go largely unaffected.

That may be a heinous thing to do, but I doubt the scope of "insider trading" applies to it.

"Is Globalization behind the recession?"

Yes. Globalization is the spawn of Free Market Capitalism, which is encouraged by the IMF and World Bank, which has virtually destroyed economies in third world nations.

Etymology is not the same as definition, and this word is not one that refers to "same patterns" but rather agreements to commit wrongful acts.


Ok, and people buy tobacco. Do the people who buy tobacco want to put tobacco out of business? No. Some may later have regrets about their actions and suffer injuries, but many of them are opposed to putting an end to the tobacco companies, usually it is non-smokers who want to put tobacco out of business.

Lenders must have people willing to take the loan. So, you are saying that by offering poor people an opportunity, even one that seems rather poor to most, is an evil act? It isn't as if they go around putting people in chains telling them to get a loan. As such, no, I see no evil in this, if we need to protect the poor people from their own decisions then why not drop the "people" from the label and call them the poor, or even slaves if we want to tell them what to do.

And that is why "trans-fat free" has become a way to signal higher quality and better health. Have you not seen labels saying "no trans-fats"? And given that, then where is this injustice where there is choice.

You mean people will take jobs away from where the production is inefficient, to put it in places where it is more efficient, and give poorer people a job in the process? How is that evil? You may complain about "sweatshops" but honestly that is our industrial revolution as well, and frankly sweatshops are better than not having a job for most people, and yes, the poor do suffer from high unemployment, so any job is likely better than no job. In any case, shipping jobs away is the same as replacing workers with more efficient technologies. It is improvement, and you are to say that improvement is evil? And the Pope might dance around this idea as well?


Misuse of the word conspire. Etymology isn't the same as definition.

Monty, trade is a simple idea. You trade because both sides benefit. Putting on their business hat isn't evil, so long as they are trading for a greater good, and a trader to some extent, loses the right to what is traded based upon the conditions under which they struck the bargain. I don't know the grounds by which you say that honest trade is evil.

Yes, but the business entity works by trade as there is nothing wrong with honest trading and honestly, I'd prefer honest trades for personal interests rather than some tribal vision.

You are dodging the issue entirely - it isn't about prohibiting tobacco (which would create another set of problems) - the simple fact is that the tobacco industry used the best psychologists and ad-men to successfully encourage a practice that they knew was addictive and deadly, while they ran a campaign to discredit medical researchers who spoke out about the hazards. If you don't see a problem there, then you truly are morally stunted, and not the least bit awesome nor glorious, nor worth interacting with.

Awesomelyglorious, your post just screams out everything that is wrong about Capitalism. That is such an immoral philosophy.

I didn't dodge the issue there, you didn't focus upon that. You attacked the tobacco industry as a whole, not individual actions.

In any case, my response is simple(but then I go on too long): who doesn't do this? Do politicians try to stay with clean hands? No. Do priests engage evolution or arguments against their faith with good logic? Not really. Do even the scholars necessarily deal with ideas with honesty? Often not. So, am I outraged that the tobacco companies did this? Well, no, every other person seems to do this. Can people who lied be morally faulted for doing so? Sure. But I imagine that the tobacco companies probably suffered in the long-run for their actions anyway given the loss of political favor that such actions can cause along with class action lawsuits, and certainly tobacco is responsible for the losses caused by its lies, but no, I don't see some unusual problem. If some group deceives and this causes loss, then they should be liable for the violation, and that is likely sufficient as it is simple that losing an entity losing resources to the extent of the efficiency loss that they caused should be sufficient punishment to wipe away their gains. Are there weird events? Sure, but moralizing by the Pope isn't going to change things, because if business needs dishonest men to succeed, it will just get dishonest men at the top, and if it needs honest men to succeed then it will get honest men, but the characters of the workings of business are ultimately shaped by market concerns.

Then the question really comes down to whether the workings of the market get in the way of human flourishing and human freedom, and my answer to both is generally no. So, I don't see the problem as I doubt that the Pope's moralizing would actually be more beneficial to human flourishing and human freedom, as unless he has great business acumen, he is unlikely to make the system more efficient, because he is only there because he knows some historical tradition REALLY well, and because he didn't get in trouble for molesting children, but Catholics do recognize that the Pope has no authority on issues that are outside of his expertise.


Umm.... actually my last post was sort of moralistic if you looked at it. I basically invoked a libertarian ethic, basically claiming that allowing the freely chosen actions of individuals is morally correct while coercive acts would be immoral. In any case, honestly, ed, I doubt you have a meta-ethic, and as such I don't see much reason to then your ethic or my ethic seriously. Mostly I engaged in the ethical frame to express a viewpoint and because ethics is good from a fictionalist perspective(sort of like how Bertrand Russell considered morals like aesthetics), but yes, I am an ethical skeptic.

umm... I'm not quite sure what that says, but I think it says "yes, I have no morals." Is that the correct interpretation?

No. It says other things:
1) It says that the last writing I had showed very strong moral proclivities towards a particular moral theory.
2) It also says that I am skeptical to the idea that an actual external moral framework built into the rules of the universe exists.

1 and 2 do not conflict, as I pointed to the figure of Bertrand Russell who compared morality to aesthetics, but was known for taking stands on moral issues that he personally saw as important.

Because 1 is true, then if we mean morals in the sense of ideals, then I appear to have some form of them. If we refer to a sense of values guiding my personal decisions though, then I have said nothing about that, but in all likelihood I have some basic values guiding my actions like most people do, if only as a matter of instinct.

Alright - there is enough consideration and nuance there to conditionally rescind some of my previous statements, although I still disagree with your positions, and have some suspicions.

What I said was "Thus we have tobacco companies conspiring to addict and cut short the lives of millions of people for the benefit of their shareholders." Anyone who knows anything about the behavior of the tobacco companies knows they are as dishonest as the average car salesman, but the consequences are far more serious. And contrary to your faith-based assumptions, the tobacco companies have not suffered much in the long run ... the amount of money they have lost in recent lawsuits is far less than what they gained through deception; they have also bought enough politicians (including an Illinois Supreme Court Justice in 2005) to limit their liability in the name of freedom and commerce.



Yes, that is certainly a moral philosophy with consistency - no one is perfect, therefore, anything is permissible.






"The Market" exists only as the composite of the behavior of millions of people. Somehow for you, if money is involved, and there is no obvious coercion that you recognize, then the conduct related to the exchange must be exemplary. Such market fundamentalism looks nothing like the world I have experienced. Do people get in the way of others, do they lie and mislead? Yes, especially when there is a financial incentive to do so. Are all behaviors and transactions free and fair? No. Is all conduct rational? No. Is the behavior that people choose to engage in always the best possible conduct? No. The market is no better or worse than the people who create it. Faith in the invisible hand of the market is like faith in the Flying Spaghetti Monster (sauce be upon him) ... it is a delusion. There is no invisible hand to make sure that this is the best of all possible worlds - people are busy planning ways to con others, and the market's invisible hand doesnt give a rat'sass because it doesn't exist. Non-market forces (government, social institutions, etc) can play a constructive role if they play their cards right.

Last edited by monty on 13 Jul 2009, 6:13 pm, edited 2 times in total.