Economics Lesson No. 6: Remind Me: What's Capitalism Again?

If you've read through the previous Economics Lessons, you have arrived at some understanding of the minimal basics of economics, and of the evolution of our present fiscal mess.

In order to gain a better grasp of free market capitalism, let's look at the difference between capitalism and all the other 'isms, like socialism or communism. It's not what you might think.

Contrary to public opinion, capitalism is not one of many viable alternative economic systems. Free market capitalism is in fact the bare bone structural economic system upon which all other 'isms are dependent.

To develop the bone metaphor, capitalism is the skeleton upon which is superimposed either our original US Constitutional libertarianism's lean athletic musculature, Europe's heavy but pleasingly plump socialist curves, or the obese and bed-ridden paraplegic dead weight mass of communism.

I repeat: Capitalism and socialism are not viable alternatives, as most people think. Today, many liberals will deny this, either pointing to Europe as an example of a successful socialist system, or calling themselves capitalists, when in both cases what they are in fact referring to is what could be called the "Third Way," or what they see as a compromise between the two. (See my articles at The Return of the Third Way and Brooks's Not-So-New Idea.)

They are wrong. Third Wayism is simply socialism feeding off capitalism. Incapable of surviving on its own, socialism, like a worm mutated into a bloodsucker, has revitalized itself by sucking on capitalism's lifeblood. Without capitalist underpinnings, all forms of socialism are doomed to fail. As my friend Professor John T. Wenders of the University of Idaho says:

"Socialism may have failed as a productive enterprise, but it thrives as a parasitic redistributive system attached to a market economy. ... Socialism in microcosm, with capitalism as a productive host, can survive and prosper. It is a measure of the power of capitalism that it survives while still supporting so many parasites."

Capitalism, therefore, is robust and strong, and can take a lot of abuse; yet, alas, there is no example today of any country that has a pure capitalist economic system. (Frankly, no country has yet had the guts.) On the other hand, there are many where capitalism is present albeit heavily encumbered, and this is the case now in America.

In spite of its recent worldwide attempt at a comeback, capitalism has long had to withstand a bad rap as the bogeyman, its reputation being sullied as a raw, mean, treacherous and profiteering free-for-all. This is evident right down to today's Webster's definition, which is as follows:

"An economic system in which all or most of the means of production and distribution, as land, factories, communications, and transportation systems, are privately owned and operated in a relatively competitive environment through the investment of capital to produce profits." (So far so good, but that's not all. Get this:) "It has been characterized by a tendency toward the concentration of wealth, the growth of large corporations, etc. that has led to economic inequality, which has been dealt with usually by increased government action and control."



Characterized by whom? Capitalism does not in and of itself have that tendency, on the contrary. It is governments that do.

Allow me to reword the last sentence more correctly: "Capitalism has grown to be characterized, in the words of power-seeking politicians and academics, and therefore in the minds of much of the public, as the primary cause of disproportionate concentration of wealth, growth of large corporations, and economic inequality; whereas in fact the real causes of these ills are inappropriate government interference via lobbying, special interest favoritism, grandstanding, and ineffective and costly oversight, in turn causing unhealthy reduction of corporate, labor and market competition, which are the principal factors that could truly control concentration of wealth and economic inequality."

This would be a much more accurate statement.

It's funny, Webster's itself has changed its tune over the last decades. To illustrate my point, here is Webster's definition of capitalism from the 1975 edition, which I much prefer and will use in future:

"Capitalism: an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision rather than by state control, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market"

That's more like it. Webster's, shame on you!

In my next post, Government Lesson No. 2, I delve a little into the history of the present distortions of capitalism in the US and Europe, and discuss the various stages of evolution of these modern democracies.

Government Lesson No. 1: Government Interference with Economics

Political interference in the workings of the free market economic machine is a perfect example of government gone amuck.

For this first lesson, read Economics Lesson No. 5, below.

Economics Lesson No. 5: Where Lies Hope for a Solution?

If you have read the previous Economics Lessons, you may be saying to yourself, "If the US Government has decided that we don't need a measuring standard for our dollar, then that must mean it's not necessary anymore and we're fine without it." Hopefully, I can help you understand how all those academicians and politicians could commit such an egregious error as to declaim that we no longer need a money standard and that gold is an idea whose time has come and gone (a "barbarous relic," I believe was the term of one of the most egregious of them all, John Maynard Keynes.)

It's called ego. Ego has been the Achilles heel of more than one. I might even go so far as to conjecture that it is the downfall of all of us, even me. The sad truth is that our more learned leaders really don't have a clue, but have left their modest common sense at the doorstep of the Hallowed Halls of Power. The price for entering inside those doors is the abandonment their sense of awe and humility. They become so caught up with their image and with the daily rat race of preserving tenure and status and power that they lose the capacity to think straight and forget what it's like to live a normal life.

Take the example of Chairman Greenspan, at the Federal Reserve. From some of the older speeches of this learned gentleman, one can see his vast accumulation of knowledge and innate good judgment; however, the man has changed his tune since he acceded to a position of power. (See my article The God Must Be Crazy at the Tech Central Station website.)

Another example is Professor and Nobel Prizewinner Milton Friedman. Here is someone whose contribution to the field of economics is immeasurable; yet he remains an enigma. On the one hand, he champions such efforts as Hernando de Soto's defense of property rights in Peru (see this web page), and those of Michael Hodges, a sincere, concerned citizen who has spent thousands of hours compiling graphs that you and I can understand, to illustrate the very dangers I've been describing in my posts. At the same time, it is to this same learned Professor that we owe our Federal Reserve's present inflationary policies. Hard to comprehend.



A kind of irrational assurance (hubris) is typical of those who attain positions of status and power - or at least it's the excuse I can find for them; and encouraged by elitists such as these, most central governments today are handing their citizens an inflationary, pyramid-scheme bill of goods. I guess it's "Apres nous, le deluge!" (That was allegedly Louis XV's way of saying, "As long as the despicable masses allow us government officials to get fat and sassy with their money, to hell with them and their progeny!")

If you're asking yourself how things got this way, I'll explain it simply by saying that it is not totally their fault. We the electorate are the ones who have hired the naked emperors as our royalty; they are only doing what comes naturally, i.e. biting into the apple. The real cause of the predicament is our sheepish blind reliance upon frail spirited politicians and defective academic thinking machines as though they were gods, when in fact they are mere human beings just like Adam and the rest of us.

I'm hoping against hope that some country somewhere will reinstate sound monetary and banking policy, but they would do so at their own risk in today's competitive climate. The only country that might undertake that risk with relative confidence is the USA, but (1) it would require the collaboration of at least Europe and Asia, and (2) it would jeopardize the existing power structures. Both of these conditions mean it'll probably never happen - unless the house of cards comes crashing down and we have a financial crisis on our hands.

Economics Lesson No. 4: A Little Bit of History

In the past, every time a nation has abandoned their fiscal measuring stick and begun to issue paper or other currency above the amount very precisely required by the free market (as determined by a combination of that measuring stick and a few tried and true commercial banking practices), sooner or later that nation has perished. Whether or not this abandonment of the measuring standard is a contributing cause or a symptom of a country's decay, in either case it is reason to stir us from our complacency.

Today, the dollar, and indeed all currencies - e.g. the euro, the rupee, or the renminbi (China's "dollar") - have no fixed measuring stick other than the arbitrary ones people and central banks wish to attach to it. (See Economics Lesson No. 3.) Unlike the "pint" of water, or the "yard" in length, the value of currencies is not fixed by law to be equal to a certain amount of this or that, as when they were designated as a specific weight of gold.

How did this happen? How did we get away from our measuring stick standard? The US situation is laid out pretty clearly in my article, How To Save The Dollar, published at the mises.org website. To make a long story short, before World War I, the fiscal discipline imposed by our standard (gold at the time) became an impediment to the governments of several nations. Most particularly, the warring efforts of Germany made everyone feel they needed to divert as much as possible of the working and production force of their people away from the normal market occupations, in order to devote a maximum of effort and wealth towards the war.

As happens in any war, many young working men were sent off to the front, away from factories. This always causes a tremendous slowdown in the normal economy and transfers a lot of investment to military needs. Industry forges full speed ahead with the war machine producing unusual items that are consumed only in time of war and sending them, along with the necessary regular goods, to the front. Those people who remained at home suffered, albeit stoically, from a lowering of their standard of living, for the sake of the cause. The free market had been disrupted, typical of war time.

War bonds were sold; but the money raised for the government's coffers was perhaps insufficient, so on top of that, it was decided that monetary discipline could be temporarily dispensed with, so as to allow our central bank in effect to print dollars in order to "pay" (in promissory notes) for the goods and services required.

I'll jump to the end of the story and tell you that, for reasons that have inspired much conjecture and contrary to past experience, the wrong was never righted; the government has never put a stop to the printing press. Thus since 1913, the US (and the world) decided for some reason that it was not necessary to undergo the usual fiscal hangover that follows wars, that this time we could do better than a market-devised monetary standard in balancing the economy and fiscal matters in general. Typical hubris of man; every time it's been tried, it fails.

The result has been the depth, length and breadth of the Great Depression of the 1930s, the quixotic ups and downs of our business cycles since then, and the trillions of dollars worth of value that has been stolen, without very many of us ever realizing it, directly out of the pockets of our grandparents, our parents and ourselves. My Dad, the sober and unpretentious economist Edward C. Harwood, warned us all back in the 50s: "Stand still, little lambs, to be shorn," by "that legalized embezzlement enslavement process called inflation." His American Institute for Economic Research repeats this published article every year or so; but it's a cry in the dark. The only thing that might stop this surreptitious theft from impoverishing our children for generations to come is a fiscal crisis - unless our politicians wise up; and they won't do that until we demand it.

Apparently we still haven't learned our lesson, and this error could be the beginning of the end of our marvelous American experiment. What is responsible? Politics. Who is responsible? We are, for increasingly putting our faith in a couple of misnamed "economics experts" and allowing a few elected human beings of the political persuasion to take our self determination away. I will try to explain how, in my next lessons.

Economics Lesson No. 3: A Better Measuring Stick than Just Paper Money

Up to this point, we have talked about the dollar, what it is, and more importantly, what it isn't (See Economics Lesson No. 1, et al.)


Most people function on the same level as our individual in Lesson 2, i.e. a dollar is worth to them about as much time and effort as it takes to earn one. Our early ancestors must have had a similar idea of the worth of the things they observed or wanted; but one day (so to speak), it occurred to the more astute among them that, instead of going to the market with apples (see Lesson 2) in order to buy the neighbor's wheat or the next village artisan's jewelry, it would be much more convenient to use something with "intrinsic" value, something light, permanent and transportable, to represent or symbolize the things we value and desire. After all, carrying around bushels of apples or fresh bread can get cumbersome and unpleasant, especially when they are no longer fresh.

They probably watched the jeweler bring unsold pieces back several times over a selling season, and thought, "Hey, I could use something like those 'old' but unspoiled pieces to trade for apples and bread, just as the jeweler does." It probably also occurred to them that they could even use these pieces to recompense a friend for his collaborative effort and time (labor), when he helped them build their house, for example. Eureka! Real money (as contrasted to today's unreal, unevaluated and unstandardized international monies) was born.

Heaven knows, jewelry was probably used a lot. It could be hung around the neck, or placed in a pocket or purse; but there are lots of things in this world that do have a greater or lesser degree of what has come to be named "intrinsic value" and that might lend themselves to serving as such a measure of wealth and store of value over time and distance. Beads have been used, but also cows and sheep. It doesn't matter what it is, as long as different populaces have a common evaluation of the object in question.

It didn't even have to be an object of extremely high value; in fact to the contrary (and this may seem counterintuitive), it is better when it is not, for it must be divisible into smaller lots of lesser value so it can be used universally for all types of exchanges, even the small ones. An example of one of the most lasting over the centuries was a pretty and small decorative shell called the cowrie. This shell money lasted for thousands of years. (For two interesting books, read "Money, Its Origins, Development, Debasement, and Prospects" by John H. Wood, and "Useful Economics" by Edward C. Harwood, published by the American Institute for Economic Research.)

By NOAA (Photo Collection of Dr. James P. McVey, NOAA Sea Grant Program) - http://www.photolib.noaa.gov/htmls/reef0224.htm Image ID: reef0224, Public Domain, https://commons.wikimedia.org/w/index.php?curid=2951837

By far the most perfect to date of these wealth measuring sticks as it evolved through the millennia is gold. There are some very good reasons for this. Gold is one of the only elements of nature that does not corrode or disappear with time (relatively speaking.) It is malleable and can be shaped into all sorts of things, including leaf, coins, or bars, and is thus transportable. It is highly valued as a decorative or jewelry item for its obvious beauty. Its stock has remained remarkably stable over history. The quantity of it within the earth's crust corresponds nicely with this expanded use as standard of wealth and store of value, and the means of extracting it progresses - also very nicely - with progress in technology. Next, it has proven most difficult (and probably will always be prohibitively expensive) to recreate chemically, thereby making counterfeiting quasi-impossible to date. (Alchemists tried for centuries, unsuccessfully.) Lastly, the relative purity of gold can be detected easily with the help of a good scale and a fine gauge.

The important point to remember about today's lesson is that unstandardized paper dollars, the quantity in circulation of which is not carefully controlled, are not a good measure of wealth, because they have no intrinsic value. Past societies have gotten around this hitch by attaching their currency to cows, or shells, or gold. So what is our dollar hitched to today? Nothing. Nothing, that is, except each one of our memories of what we bought with it last week, or what one dollar's worth of our labor feels like; and these memories have a tendency to vary tremendously from one person to the next, and to fade over time and distance. The next lesson will delve into why today our memory is just as poor a substitute for gold, or even for shells, as it was when real money was invented.

(By the way, please do not hesitate to ask me questions in a commentary. I will be happy to respond if e-mail addresses are given; otherwise, they may inspire a new post on the subject.)

Economics Lesson No. 2: Wealth, Worth, Prices, Capitalism and Competition

So what is wealth anyway, if dollars are only paper? (See Economics Lesson No. 1) How do you evaluate something's "worth?" And while we're at it, what is capitalism?

My father Edward C. Harwood was an economist who created the American Institute for Economic Research in Boston in 1933, moving it to Great Barrington, Massachusetts in 1946. When he gave his speeches, he was always very clear about the basics. For example:

First, what is wealth? Wealth is stored value, as contrasted to spent value. Most often, we measure wealth in terms of the dollars we have saved or invested and of the dollar selling price of the things we have acquired. Now, when you think about it, the value to each of us at any given moment of any particular amount of wealth is probably going to be the equivalent of the time, skill and intensity of the work it would take to earn enough dollars to pay for it. Following this to its logical conclusion, wealth is therefore essentially nothing more than stored work.

Thus in short, we represent the value of a dollar as the work required of us to obtain one. Then how do we go about evaluating something else's worth in dollars, using our own work as a measuring stick?

Here's an example. Imagine that you are walking about in the hills of Berkshire County on a nice September day. You come upon some apples on a tree. For nothing more than the effort it takes you to reach up your hand, you can pick one of them to take home or eat on the spot. Assuming this apple tree is not on someone else's private property, this apple is "free," other than the little effort expended to pick it. You didn't have to pull out one extra penny to give to anyone. This apple is cheap.

Now imagine that you are walking through a market on a small New England street. There are stands of fruit of all kinds. That same apple is sitting on one of those stands. Rather than pick it up and try to get away with consuming it for free, you will probably pull a few cents out of your pocket and give them to the person who bought the land and seed, planted the tree, picked the apple, bundled it up, transported it to market, rented a stall and displayed it on tables (with decorative leaves) just so that you could share in the pleasure of feeling the juice run down your chin.

What I'm getting at is that the apple, in truth - and this is counterintuitive - is worth only the time and effort it takes for you to pick it, chew it up and throw out the core. It's "intrinsic value," in other words, is much less than you would think. What you are actually paying for is the merchant's services: his time, his labor, and his cost to obtain the tree seeds, to tend the trees, to buy a truck to take them to town and to put them so nicely on display.

Photo credit: By Jonathunder - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=11808709

So how do buyers and sellers determine the value of their work in dollars?

Because there is probably more than one apple seller at the market that day, the sellers have two worries. They cannot just ask for any amount in exchange for the apple, because either the buyer may decide he'd rather work himself, go out in the fields and pick his own apple, or the merchant next table over may accept a few pennies less, just to get the sale. This sounds like a game, and in fact it is, because the two or more sellers will take more and more pennies off, right down precisely to the point where it barely pays them to bring the apples to market at all.

In a sense, the winner is the buyer, because as long as no one is colluding and the game is played fairly (more about that later), he doesn't have to worry about being "ripped off," given that the bargaining process will ensure that the price of his apple is about right relative to the cost to bring it to market. The buyer also knows that he can do the work himself; therefore, if he doesn't want to pay whatever that price is, there will be no apples next time, and that's just the way the cookie crumbles.

If that happens, that means there will be no advantage to having apples brought to a market. On the other hand, you may have been smart enough to note that in all cases where a sale is completed on a voluntary and fair basis, both the buyers and the sellers are the winners, because both sides have gotten what they wanted to make their life better. Not only that, but the market even determines what the fair price of an apple will be on that particular day, both for the buyer and the seller. Everyone's happy. That in a nutshell is the beauty of capitalism and its underpinnings, competition.

Now we must move on to the dangers of a "floating" dollar, and why our evaluation of our own work is a pretty primitive and unsound measuring stick for a dollar's worth.

Economics Lesson No. 1: What's a Dollar?

In spite of what economics professors will tell you, the most important lesson to learn about economics is what a dollar is, and what it's not.

I'll never forget sitting in the back of a small town Rotary Club meeting somewhere in the 1950s US of A. My father, economist Edward C. Harwood, was the invited speaker up at the podium, and my proud Mom and we kids often tagged along.

It started out as the usual boring lecture, when my ears perked up at this question:

"How many of you know what this is?" as he held up a dollar bill.

There was that typical wary silence as each listener struggled to figure out the hitch. Eventually, an emboldened hand went up.

"It's wealth?"

My Dad (you'll notice I always instinctively use a capital D) shook his head. Others offered, "It's something to buy things with." "It's what we get for our work." "It's a bank note."

I knew that I didn't have the answer he was fishing for either, so when it finally came, I was just as surprised as the next person.

"It's a piece of paper."

Of course, this made everyone chuckle. Not only did that seem silly, but they all had the impression that he was trying to pull a fast one and that there was going to be a good joke coming out of this - which in a sense there is, only the joke's on us all (or at least 99.99997% of us.)

He went on to say that, contrary to common thought and in spite of the fact that people will go to great lengths to procure dollars, often mistaking the green notes themselves for the wealth they represent, the truth is that a dollar is worth practically nothing in and of itself; it is merely a promise to pay. It has almost no intrinsic value, it's relative worth coming from its historical use as a symbolic tool of exchange.

In other words, without the value we humans place upon it, a dollar is worth nothing more than the few cents of paper, ink, printing machinery and labor cost it took to produce it. Any value that we instinctively perceive in it has in fact been superimposed upon it by all of us, a community of normal people who have blind faith in our government and banking system.

The next part of my Dad's lesson was devoted to explaining the real punch-line tragedy of it all, i.e. that this promise to pay is a promise that the government is supposed to be helping us all to keep. Unfortunately it has failed to do so over the decades, in fact quite the contrary; and most of us don't even realize it. The result has been the impoverishment of all holders of dollars, including you and me, to the tune of many trillions over the last century. To top it all off, this treason is still going on today, even at this very minute.

If you've followed all of this so far, then you and those Rotarians probably are better equipped to set fiscal policy than half of the economics professors in the world, including a couple of Nobel prizes! (Don't worry; I know you don't believe me. I'll try to show you why this is true, but you must be patient and keep reading, when and if you can.)

Economics? Ugh!

When I was about ten, I asked my Dad, economist Edward C. Harwood, "Economics is so dull; what is so impassioning about it? I mean, it's so ... BO-O-O-O-R-ing!" I was convinced from all I had seen and heard (and apparently absorbed) that there didn't exist a more unexciting, uninspiring, laborious, besotting field of endeavor. It had no physicality or rhythm, no charm, no color, no sense of humor, and seemed to be filled with nothing but numbers, graphs, and the kind of bespectacled people that can spend their whole day fiddling with them. Ho hum. (At least to a ten year old.)

His answer was to explain that to study economics was to learn about the spring from whence sprung much of the good and evil experienced by mankind. It was not wealth that fascinated him; it was the idea of eliminating the suffering so attached to the lack of it. He didn't say that wealth brought happiness, nor that it was the source of all evil, or even that it had the power to change basic human nature in any profound way; but what he said was that its control, once out of the hands of its original creator, was a tool to manipulate whole nations, even to the point of war. What could be a more profound subject of inquiry?

I thought of that a moment; then asked, "But what about religion? Isn't that even more fundamental than money? How about psychology? Doesn't that touch a more basic element of humanity?"

His reply was to explain that as a scientist, he had come to the conclusion that neither religion nor psychology was a true science, as he understood that word. His own experience learning about the myriad forms religion takes and the diversity of psychological theory had led him, in the first instance, to interpret the word "God" as a name for "We Know Not What;" and in the second, to see that psychologists and psychiatrists had about as many explanations for human behavior as there are human beings. Therefore, any pretense of being able to fathom such unknowns as the human psyche or human faith - and more importantly any attempts to describe any fundamental "truths" about either subject - were destined to failure by their very nature, and therefore at once hypocritically presumptuous and intrusive upon very personal and private matters. It was not that he wished to diminish the importance of the role of faith, or morality, or the human psyche in each person's life and in society as a whole; he just didn't feel competent, as a member of our race of common men, to delve into these notoriously subjective realms of research with any hope of contributing something useful to society and human progress.

On the other hand, although these questions of faith and of human psychology may be most fundamental, the next one up the ladder was man's attempts at societal organization, and more specifically his undesigned, evolved market behavior and his various, historically more or less successful attempts at political structuring. Here was the domain where he thought he might have something to contribute, all the more so because these particular fields were full of erroneous and sheepish theorization that badly needed the attention of as clear-minded a shepherd as he.

I understood the basics of what he was trying to say; but it took me 45 more years and an attack on our soil by self-declaimed representatives of the world's most forgotten have-nots to bring home to me just how right he was.

Here he is, in an uncharacteristically friendly pose - oh, don't get me wrong; in his defense, you must remember that any happy-go-lucky comic wrinkles left in him after his simple New England WASP upbringing were steamrollered out by iron West Point discipline and two world wars. And anyway, I was in on the secret: underneath a somewhat foreboding exterior beat the humblest of golden hearts. (No pun intended, for those in the know.)

Photo credit: Fortune Magazine

What's So Interesting about Economics, Government and Philosophy? (And What the Heck's Epistemology?)

First of all, let me be plain. I have no degrees in any of the above. My only academic claim to fame is a BA in Communications and Theater Arts from Mt. Holyoke College; furthermore, to be frank, I learned relatively little of an intellectual nature while at that institution, and most particularly, about these four subjects.

Everything I know about them comes directly and indirectly from my father, Edward C. Harwood. He was an economist and a true philosopher of the highest caliber, and it was he himself who recommended against my taking such courses (although I did manage to sneak in Philosophy 101, if only to better understand what it was he objected to; needless to say – or perhaps not so needlessly – I got it immediately; and I'll tell you some day.)

I grew up in a house that served both as a family abode and a business center. In it, my relatively illustrious father worked, ate, slept and brought us up, all four of us – five, if you include my mother.

It was a unique lifestyle. Punctual 6 o'clock family dinners were interspersed with patriarchal wisdom. "Stop bickering. What we have here is simply another lack of communication." "Do not use the word 'concept.' Its meaning has been completely hijacked by modern discourse." "Come with me right this minute to my office, young lady, where I'm going to give you something to cry FOR."

I loved him more than God. I swore I would marry a man just like him, little realizing that never again would I meet such an individual. (Of course, I went through my rebellious period, and took off with a man who had every bit his will, much of his charisma, a lot of his acumen, some of his character – but little of his patriotism, and none of his business sense.)

From the day he first took me up in his arms, we saw things eye to eye. I felt privileged to be able to connect with his every word, almost before he pronounced it. I seem to remember his designating me as his "Lucky Seventh," although I could have imagined that. (My three siblings and mother would not recall it; nor will his three children by a first marriage – but they have an excuse: we never lived under the same roof.)

So in sum, my first 13 or so years were spent submerged in a virtual academy of economics, government and philosophy, the likes of which does not exist anywhere else on earth.

The buildings still exist today; see one here.

Photo credit: Frederick Harwood

Most unusual, indeed, was my childhood apprenticeship. (By the way, epistemology was among the subjects "studied." Webster's defines it as "the study or theory of the nature, sources, and limits of knowledge" – a formidable sounding effort; but a vital one, nonetheless. More about this later.)

NB: Anyone who feels that I have made an error in my postings is welcome to let me know, and I will gladly rectify it if I can, and if I judge it appropriate.

Why Sybil? (Some Personal Asides)

First, there was the obvious appeal of young innocence faced with such an adult challenge. (See her story under "Profile," to the upper right.) But there also were some surprising coincidences that piqued my sense of affinity with Sybil.

She was the daughter of a colonel. Me too.

She rode horses. So did I, in my younger days.

She came from a large family. Ditto, at least relative to the times.

It is believed her son went to West Point. My Dad graduated there in 1920, I think it was.

She was widowed as a young woman. Alas, so was I.

There was likely no corner of her 1776 New England township's woods that she didn't know like the proverbial back of her hand. Likewise, there are a few hundred acres in 1960s Western Massachusetts that hold no secrets for the 16 year old that I used to be.

Later in life, she ran an eating and drinking establishment. Believe it or not, I've been known to do the same. Here's the one my husband and I run right now. (I also go by "Johanna.")

She was wakened from the hypnosis of daily chores by imminent danger encroaching upon her home turf. September 11 did that for me.

She had only a stick and a steed on a dark rainy night to warn her dad's fellow countrymen of the encroaching folly. I've got nothing more than a keyboard and this lightning rod that is the internet.

And speaking of mounts, I imagine we shared a similar sense of esteem for this wonderful animal. Here's an example of what I'm referring to: have you ever seen a more exquisite creature?

Source: http://boomerangberrima.com.au/the-distinctive-world-class-breed-of-the-arabian-horse/

Perhaps her horse looked like this one – Oh dear; what am I saying? This one is named "Psymreekhe;" hers was "Star," too mundane a title for this handsome fellow so many lightyears away from Sybil's little world. Star must have had a few more bumps and bruises, too; but she probably loved him anyway, naming him after an endearing little white spot in the middle of his forehead.

Just one of this species has enough courage for fifty young ladies. If only I possessed 1/50th of it, I might feel more justified in identifying with Sybil; as it is, I feel a little guilty at having attempted the comparison.

But I digress from my main purpose, which is to simplify the intricacies of economics, government and philosophy.

Introduction

Like Sybil, I feel like I've become aware of a war.

The war is between the hypocrits who profess to know the truth, and the innocents who wonder; between the power elite of academia and politics, on the one hand, and, on the other, the individuals who are awed by the significance of the battles in which democracy asks them to take a stand, who are frustrated by the noise coming from an increasingly complex universe of information, and who want help prioritizing and simplifying it.

First Premises

The most important things to a human being are, in this order: life, liberty, property, and the pursuit of happiness. Concerning the first, we can all agree about the importance of being alive. Hopefully, we can also agree to disagree about the nature of Number 4, or the best means of pursuing personal fulfillment. But as to the second and third items, freedom and the right to own property – as to liberty's optimization and as to the degree to which property should be private – there seems to be much confusion.

At the forefront of this debate are two competing philosophies, one represented by colonial America under the Constitution's strictest interpretation, which we could agree to call the Small Government theory. The second, or Big Government theory, is represented by the European model of representative democracy.

Ever since the 18th Century, and for whatever reason, American government has grown in size, to the point where it now rivals its European cousin. Against this newer European invasion, I would like to send Sybil out again on her precarious ride, to reawaken the good willed people's love and respect for freedom.