I have maintained for a long time that there are some things that you just can’t operate like a business. Education and Health are prime examples; one must be prepared to sink money into it without seeing an immediate financial return, certainly not in the same quarter, at least using the traditional benchmarks. The banking system is testament to what happens when you allow big business to independently administer every aspect of an industry; consumers receive an inferior product at a premium. Unlike the technology industry, for example, where companies have to innovate and improve their product to stay ahead, the banking industry is more or less stagnant; savings or loan – it’s pretty much the same 2 products renamed and rebranded over and over. Hence it stands to reason that the only way to increase profitability for shareholders is to minimise the value for money received by consumers.
As the years went by, my disdain for commerce has only increased. I used to think that perhaps my distrust and disgust were symptomatic of my tender age, that one day I would grow out of it, emerging from my anti-establishment cocoon to soar in the corporate sky, like baby-boomers emerging from the age of Aquarius. If anything, the opposite is true; I only get angrier at how things operate “business as usual”.
I now believe that nothing can be operated like a business. The economy is a lie.
I have a few irreconcilable differences with commerce. Firstly it does not achieve many of its perceived benefits. Money is meant to provide a stable benchmark to which relative value of goods and services can be assigned. It is meant to be a comparison tool for accounting purposes, money itself does not have a value. However the fact that it does not have a set value (such as the gold standard, as used to be the case) means that a balancing act of inflation (a measure of the decreasing value of money) interest rates (a measure of the cost of money), and printing more money must be maintained, a veritable dog chasing it’s tail.
Secondly for something imaginary, the economy certainly holds a lot of sway. In fact it is probably at the top of the pecking order as far as motivation for goodwill and enmity alike. A buck to be made sure helps lubricate the wheels of charity; similarly few motives for evil are as compelling as money, both at an individual level and an international level (I think the transparent foreign policy of certain nations are case in point). The economy is meant to be a tool that serves the needs of the people; it is meant to make it easier for people to get on with the business of being in business. However it is usually the people who become the slave to the economy.
Take John Howard’s Baby Bonus of 2004 for instance; rather than reconfigure economic theory to fit the economy around the changing characteristics and needs of the population, it was considered easier to just increase the population. Increase the number of consumers. Hopefully increase the proportion of workers (although this is dependant on the values of the recipients of the baby bonus). Real, tangible human life was created to perpetuate the imaginary concept called the economy. I thought the church was the only institution that encouraged people to have kids to perpetuate imaginary concepts…
Thirdly, with no amount of drinking is the inner nerd in me able to get over the criminally shoddy maths. For something that is so pivotal to the steady functioning of society why is it that the level of mathematics used to measure and model the economy is so deficient? The academic prerequisites for business school so lenient? It alarms me that when I hear market reports I don’t usually hear economists quoting rock-solid facts and figures relating to a commodity. Economists remark on “trader confidence”. That’s your indicator? Whether or not some business school grad is having a good day or not? What the hell did you learn in those 3 years at uni!?! The current recession that the world is in, despite politicians dragging their feet in calling it that, is due to too many greedy people with a poor grasp of the fundamentals of mathematics. A poor grasp of ethics is also a strong factor.
When you want expert advice about your health, you consult a doctor, who with their own extensive, exhaustive education and training, combined with centuries of refined and documented medical research can give you a pretty good idea about what is wrong with you. When you want expert advice about quantum mechanics, and the behaviour of infinitesimally small particles, you consult a professor of physics who could not only inform you about how the location and momentum of small particles becomes immeasurable, professor will be able to quantify the uncertainty.