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My message of Sun 18 July, below, got lost in
the socialcredit address change. The previous
message of Sat 11 July was OK.
Wes.
----- Forwarded Message -----
Date: Sun, 18 Jul 2004 12:10:27 -0400
Subject: Fw: [ccmj] Fw: [GJM] Part II, (M1) Since 1959, Endogenous
Money In Two Parts.
MIME-Version: 1.0
Content-Type: multipart/alternative;
boundary=--__JNP_000_1f57.7a3f.07ca
Bill Ryan,
Thanks for the corrected server address.
I notice Peter G. Peterson put his e-mail address,
"Where Are The Business Patriots?" in the
Outlook section of today's Washington Post.
Ten years late.
Wes
The forwarded message below omits Fig7-9f to
clear the size limits on list CCMJ and all lists@topica.com. If you cannot
retrieve Fig7-9f from Curtiss' URL below, let me know and I'll
send it to you attached to an off list e-mail.
Wes Burt
----- Forwarded Message -----
Date: Sat, 17 Jul 2004 16:45:02 -0400
Subject: [GJM] Part II, (M1) Since 1959, Endogenous Money In Two
Parts.
Message-ID: (Deleted by Wes Burt)
Hi Folks,
This part II will respond to a few encouraging
replies and to a more wide spread sullen refusal
to discuss the systemic defect of omission in US
public policy which has informed the status quo
since our free market was subverted in the 1890s.
The difference between a free market and a
subverted market is clearly illustrated by the
215 year profile of the US Consumer Price Index
shown by Fig10b and Fig10d. From colonial times
until the 1890s, the US Dollar increased in value
except during time of war. From the 1890s to 1965, the US Dollar lost
value at a sustained rate of 2.3%
per year, because of the uncorrected policy defect.
The news worthy events of the 20th century; World
War I, The Great Depression, and World War II
caused only minor perturbations about the
2.3%/year inflation trend line. But beginning in
1965, Fig10d shows the willful, deliberate, and
systematic effort to destroy the American
Republic along with the values incorporated in
its founding documents. Keynes said: "not one
man in a million can diagnose inflation." We are,
each one of us, contributors to this sorry trend,
as Bastiat said in 1850:
"some for our evilness, the
rest for our
lack of
understanding."
I am much obliged to Lowell Manning for
his Sun, 27
June 2004, suggestion on list ERANet that the 68% of M1
(not employed as M0 in producing
the Gross Domestic
Product) will be held in "liquid
investment accounts to pay
current
calls in the investment sector."
My experience does not
reach to "the investment sector"
so I dare not comment.
~~~~~~~~~~~~~~~~~~~~~
On Wed, 14 July 2004 Janos Abel writes to
list GJM, in part:
"Dear Wes,
I always read your prose posts but your charts
do not speak to me. I read a lot about world
problems but cannot understand charts without
verbal elaboration."
I understand the need to focus more of my prose
on the charts. The charts are second nature to
that small minority of folks who share my on-the-
job training. Our schools and media do not teach
these charts. I'll do my best to bridge the gap.
~~~~~~~~~~~~~~~
On Tue, 13 July 2004 15:12:53 -0400 Curtiss Priest < bmslib@mit.edu> writes: > >
Dear Wes, > > I am always glad to read tours of your
charts: > > http://www.epie.org/cyber-soc/default.htm>
> Thanks, > > Curtiss >
> W.
Curtiss Priest, Director, CITS > Research Affiliate,
Comparative Media Studies, MIT >
Center for Information, Technology &
Society > 466
Pleasant St., Melrose, MA 02176 >
781-662-4044 BMSLIB@MIT.EDU http://Cybertrails.org>
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Dear Curtiss,
IOU much for hosting my figures at your web site
and for your kind
words about the tour of Fig4.7,
Macro Model of the US economy 2003.
But as I
said in a previous post, having those figures on
your web site has not helped me one damned bit
toward bringing "The Optimum Policy" (TOP) into
the public debate. I need you to speak to the
subject with the same authority and eloquence
with which you address such symptoms of the
defect as debt, interest, usury, and monopoly in
the US media. If your connection to the US establishment at the
Massachusetts Institute Of
Technology (MIT) would cutoff your stipend if you
do speak to the issue, then the establishment is
where the education is needed most.
Following your recent posts, I dusted off my 917
page copy of Paul A. Samuelson's ECONOMICS,
Ninth Edition 1973, to refresh my memory of
"increasing returns" and "Pareto Optimality." I
found Fig5.0, Macro Top View of US Economy
2003, on page 629 under the heading: General
Equilibrium Pricing.
In Joseph E. Stiglitz's 1813 page, two volume masterpiece, "The Collected
Scientific Papers
Of Paul A. Samuelson," scarcely a page goes by
without Samuelson reminding his readers of the
firm technical requirements for perfect competition
in a free market. In his 1955 paper, Aspects Of
Public Expenditure Theories, Page 1236, we read
a repetition of Henry Carter Adams 1887 statement
of the systemic defect in US domestic policy:
"So long as increasing returns
prevail in the
actual range of consumption,
we know that
perfect competition will not be
self-preserving
and market behavior is unlikely
to be optimal."
Thirty-one years after the ninth edition (58 years
after my last economics course), the current edition
of ECONOMICS must surly include the vertical
dimension I omitted from Fig 5.0, but added in Fig4.7.
And surly MIT students are now being taught that
US WHIPs and their successful corporations enjoy
"Pareto Optimality" every day of the week and
twice on Sunday. But I wonder if MIT students
are also being taught that US small businesses
and US parenting households suffer "increasing
returns" as illustrated in figure 9 of attached
Fig7-9f.gif, "A Micro Model of Any Industrial
Economy or The Whole Divine Law." Here
is the 4,000 year old
technical reason for three
familiar objections to free competitive markets,
when suppliers are corrupted by increasing returns:
1, The rich get richer and the poor get poorer.
2, The large get larger and the small get smaller.
3, The smart get smarter and the dumb get dumber.
The unchanging nature of human beings prompts
each of us to fear any change or development
which will compete with our own efforts. This is
a perfectly natural response and those folks with
the power to obstruct the development of
competition will, as P. T. Barnum put it in
John D. Rockefeller's day, "never give the
suckers an even break." Unless, of course, the
WHIPs are persuaded of their advantage in letting
the suckers get up off their financial knees.
As you know from our previous Q&A sessions on
Fig7-9f, this web page is the centerpiece of our
"level one" intellectual, spiritual and political
stance, as promulgated (below) in a 15 July
exchange of e-mails on the Global Justice
Movement list between Mr. John Gelles and
Dr. Muhammad Mukhtar Alam. This recent
convergence is the most encouraging economic
development since Henry The Eighth enclosed
the commons, and gave Oliver Goldsmith a tale
to tell in his poem, "The Deserted Village."
One might say that if the four of us can sustain this
degree of convergence in our thinking, and could
persuade James Cumes of list VOW and Rodney
Shakespeare of list GJM to join the choir, the six
of us will have launched a new paradigm for
achieving "Victory Over Want" by bringing the Global
Justice Movement to a climax. And together, we six
would outnumber a whole multitude of Communists, Socialists, Democrats,
Third Way Parties,
Independents, Republicans, and Fascists who
preach to us daily from the democratic swamp
surrounding the "unfinished Republic" on the
back of your $1.00 Federal Reserve Note. The
world views of that preaching multitude, on the Internet and in the
media, are not always wrong,
but they are always and absolutely incomplete, because the #5
through #12 moral commandments
of Fig7-9f are omitted from what they preach.
Moral commandments #5 through #12 also seem
to be missing from the A3 new Australian
Constitution being discussed on list ERANet, even
though Article VII, of The Church Of England's
thirty-nine Articles of Religion, makes the Moral
Commandments an obligation of all Christian men,
including those on the CCMJ and Social Credit lists. Neither are
the eight Moral Commandments found
in the Universal Declaration Of Human Rights, but Thomas Paine included
them in his 1792 "Rights Of
Man, Part II."
So much for hind sight. In his Thu, 15 Jul 2004
note, Subject: Re: [GJM] "Grass Roots Agendas
In favor of Liberty and Economic Progress,"
John Gelles wrote:
Dear Muhammad,
I fully agree with you on the existence of a level
one intellectual,
spiritual and political stance.
I am confident you and I are level
one.
As to levels 2 and 3, we will have to find one or
more of their number
to confirm their existence
and defend their stance.
John
===================================
----- Original Message -----
From: "Muhammad Mukhtar Alam"
Dear John.
Greetings for peace,
. . .
men and women [may] have three levels of
intellectual, spiritual and political stances
1 - Those who consider commands of God/Allah
important for social
organization.
2 - Secular atheists who have made themselves
god by seeking consensus for
various agendas
of their
choice..most of those happen to be
defined with doctrinal
denunciation of the
commands of
God..Freedom is sought for
institutionalization of the practices, lifestyles,
consumption patterns, and
production patterns
that are in violation of
the commands of God.
3 - Those who are opportunists and have no real
commitment to whatever
cause.
~~~~~~~~~ End John Gelles' note ~~~~~~~~~
Curtiss, I fully share your approval of the founding father's wisdom in
separating Church from State in
the US Constitution, as expressed in your 15 July
2000 note "Re: [GJM] Is this really America/USA ??"
to Muhammad Mukhtar Alam on list GJM. But we
seem to have arrived at different conclusions
as to how justice will be restored in the USA. You wrote, in
part:
"In my opinion, this country (US
of A) is still
searching for a political system
that actually
brings justice to this
country."
~~~~~~ End excerpt from Curtiss' note ~~~~~~
I have detected no such searching. There is only
one political system that honors the word "Justice"
by extending equal social credit to each child from
the time of its conception until it is fully developed
and becomes self sufficient. This is what I believe
C. H. Douglas intended Social Credit to do. At the
beginning of my inquiry in 1969, I concluded that
the US needed to fully disburse the first Mosaic
Tithe as defined by Dr. J. H. Hertz, C.H. Late Chief Rabbi Of The British
Empire, in his notes on Melchizedek king of Salem. As I searched the
literature, I found that all of the prominent folks
listed on Fig7-9f had reached the same conclusion,
but we have not yet even begun to discuss how
such a defect of omission could last so long in
the USA.
In my 80 years, I have never heard any person
speak contrary to the eight moral commandments,
#5 through #12, while the religious commandments,
#1 through #4 have been a source of conflict and bloodshed since they were
first brought to our
attention in Exodus 20:1-9. The US founding
fathers were well advised to put the four religious
commandments on the back burner. There is
always a full court press ready to enforce and
enlarge the second tithe for compensating the
Thirteenth Tribe (law givers).
What advantage can anyone claim for limiting the
first tithe to funding only 1-12 public education?
Subsistence, health care, and higher education
are likewise fixed financial burdens which fall
unequally on the budgets of parenting households.
As long as those fixed financial burdens are under
capitalized, parenting households will experience
"increasing returns" as illustrated on Figure 9. And when the
competitive action of a free market is automated, as in the US Eastern Power
Grid,
each unit plant becomes bistate, with a large
hysteresis loop, if fixed costs are included with
the variable cost data as in Figure 9. Then, both
Pareto Optimality and stable operation of the
power grid are lost. We would not be able to
dial-up our e-mail boxes.
The three stage analysis of Figures 7, 8, & 9 is
equally applicable to both the population of
productive capital assets at 90 degrees and the
population of productive human assets at 270
degrees on Fig4.7. Households always operate
in tandem (Series or Binary) with the capital plant
in any economy, so the whole private sector cannot
prosper by beggaring the whole public sector, but Warren Buffet's and
Peter G. Peterson's class can
prosper by keeping their competitors and the public
oblivious of "The Optimum Policy."
If the performance of either class of asset is
impaired by pricing some contributors out of the
market, as in Figure 9, the flow of M0 (the working
part of M1) through the capital plant and households
of Fig4.7 is diminished. But, in the US, all corporate
productive assets are located along line (A, y) of
Figure 9 to achieve a Pareto Optimal dispatch of
production with all assets enjoying a fair margin
of profit. The US human assets, on the other hand,
because they are undercapitalized, are located
along a family of curves: (A, 1x), (A, 2x as shown),
(A, 3x), (A, 4x), etc, etc, according to the number
of dependents supported by each productive
human asset.
The mischief done by this under capitalization, this systemic defect of
omission, is not found in the
underdeveloped US children, although there are
too many of them. The US parenting families
see to that, at the expense of everything else.
And yet the United States of America, now 109
years into this "race to the bottom," did replace
the British Empire as the global super power, for
another few decade, perhaps. So this systemic
defect did not significantly diminish our ability to
produce wealth and consume our natural resources.
Instead, the mischief is done by the intense competitive pressure on every
participant in the
economy. This pressure to compete, is the
result of more than a century of psychological
conditioning of both labor and management by
the following three symptoms of capitalism, when
the labor markets are corrupted by increasing
returns to scale:
1, Unemployment at 4% to 10%.
2, Inflation at a natural rate of 2.3%/year, plus
massive injections of exogenous money to
fund deficits and expand the National debt.
3, A sustained 3-5% of GDP shortage of purchasing
power among young low income families.
Now Curtiss, what shall we do with TOP (The
Optimum Policy) which is hosted on your web
site at the URL in the signature below? The US patents on the control
features embodied in the several figures were assigned to the General
Electric Company in 1953, by three engineers
J. J. Larew, B. R. Shepherd, and W. S. Burt. So
this ancient knowledge cannot be closely held
for proprietary advantage over competitors. It is
so simple and fundamental that all capable
business men converge on it instinctively, without
instruction in economics. Even Japan and Western
Europe converged on it after World War II.
C. S. Lewis' senior devil, SCREWTAPE, described
the most common use of this knowledge, historically,
when he advised his nephew, Wormwood:
"our best work is done by
keeping things
out of their minds?"
The gifts of nature are free. The only things worth
stealing are the things other folks have produced.
And the stealing is easier if the suckers are kept on
their knees; praying, paying, and obeying, oblivious
of how the system works.
Now Curtiss, are we content to let Messrs. Gelles
and Alam monopolize Level One? Or is there room
in Level One for a few more folks from my eight
favorite mail lists? We can get an idea, by how
many of my favorites distribute this post with
Fig7-9f attached.
Kind regards,
Wes Burt, new member of "Level One."
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