Great economists have worked on the economy’s key initial and boundary conditions—those in politics and governments. Now, maximum leverage will come from improving on the current party system.
Economics Is the Study of Humans’ Actions to Add Value
Economists study human action that’s intended to add value. Economists make use of philosophy, theory, and observations. Everything flows from the axiom that humans act intentionally.
Economists consider complex, real-world action. Because good economics is anchored in sound theory, it provides understanding that’s empirically valid. This is what the proper study of real-world action should be expected to do, since after all the most-complete model of the real world is the real world itself.
Politics Sets the Key Initial and Boundary Conditions
Politics is human action related to governments. On the human action that adds value, which is the subject of economics, politics is what sets the key initial and boundary conditions.
Initial and boundary conditions critically influence the actions throughout systems across time.
Initial and boundary conditions influence model systems, but equally influence real systems. In both cases, initial and boundary conditions limit the extreme values that any parts of the system reach, and constrain the time that this takes.
In economic systems, initial and boundary conditions limit how much value can be added by human action.
Voter Education Isn’t a Prerequisite for Change
It may seem that before we will get less-economically-harmful actions from governments, we will need voters to achieve numeracy and economic literacy. Or that before we will get constitutional limited governments, we will need voters to understand how the Constitution is designed to work. But in both cases the key limit is not education but organization.
Generations of voters were taught to favor the policies of Prohibition and of Progressivism before these policies began to be adopted. This was helped along by government schools. Government actions produce results that are bad, so proponents need voters to be indoctrinated.
But voters need little education to support economically-sound low taxes and constitutional limited governments. In the American Colonies, under astoundingly-limited governments, voters experienced growth substantial enough to propel them from subsistence-level to having per-capita purchasing power that exceeded that of Great Britain’s people by 68%. These voters eagerly supported keeping total taxes as a fraction of GDP no higher than 1% to 2%, and these voters watchfully supported the Constitution’s government-limiting processes. Government-limiting actions produce results that are good, so proponents only need to utilize effective government-limiting processes.
Maximum Leverage Is Provided by a Good Major Party
Today, the missing government-limiting process is the design and operation of at least one major party that’s good.
So far, no parties have been good. All parties to date have used centralized, top-down control and unenumerated, unrestrained power to select and elect candidates. All parties to date have lacked processes to disqualify bad incumbents.
The processes that all parties to date have used have ended up selecting for candidates who won’t use the Constitution’s decentralized, bottom-up control and offsetting powers to limit government.
A good party, by design, and in operation, will use Constitution-derived decentralized, bottom-up control and offsetting powers to limit the party government. A good party will have processes to disqualify bad incumbents.
Given this design and operation, a good party will select for candidates who will in turn use the Constitution’s decentralized, bottom-up control and offsetting powers to limit governments.
Past Great Economists Have Taken on Politics
To appreciate the relationship between economics and politics, it’s not necessary to visualize the economy as being capable of being mathematically modeled, it’s only necessary to pay attention to the big picture. Economics includes bedrock content—money, banking, finance—that, in historical experience, has resulted from the combined action of government people and their business cronies.
Naturally, then, politics has been considered in detail by great economists. For example:
- Frederic Bastiat used down-to-earth stories to solidly explain the benefits of voluntary cooperation and the harms of overriding cooperation with political coercion using law.
- Ludwig Von Mises served at a key time as chief economic advisor to the Austrian government, where he slowed Austrian inflation.
- Murray Rothbard wrote engagingly about governments and money, tackled the governments’ Great Depression, and ultimately provided a deep understanding of the impact of parties on economics in A History of Money and Banking in the United States and The Progressive Era.
These men, and others in their intellectual tradition, would have a field day with today’s decentralized media, today’s Tea Party and more-libertarian elected minorities in politics, and today’s opportunities to spontaneously network, experiment, and innovate.
Present Economists Should Help Limit At Least One Major Party
Many who present as economists conform their understanding to the desires of politicians. They are deep in the game, changing the outcomes. If good economists stand on the sidelines, that inaction might be all that’s needed to allow evil to triumph.
Economics isn’t a spectator sport, economics is purpose-driven action. The key value-adding actions are those of customers and producers. The key value-subtracting actions are those of politicians and cronies. And politics is controlled by parties, the tails that wag the dog.
To limit governments, then, limit at least one major party. To limit a party, focus first and foremost on processes that limit the party government. Build at least one good party to last.
Voters keep trying to break up the activist-crony, business-crony Progressive monopoly over government that has been grabbed by the major parties. All voters need is the right decentralized, self-limited party organization.
Economists are well-prepared to understand this and to be integral to the action that’s needed. Liberty is calling!
