J19 - October Goal Post: Creating with the Human Mind

Because he gives me the most material to read and analyze and reflect upon, my thinking often tracks the thinking of Alex Gugie. Alex has been focusing this month on the human mind, as something more than just the sum of its parts (neurons and such). And my focus has been the same: the human mind, and its role in the real world of economics. The human mind not only determines the value of a good, but it determines whether an object is, in fact, a good at all. So much of society and civilization is dependent on what the human mind can imagine and achieve. No thing is inherently good or bad; it depends on the person’s perspective (and I think that this works for other adjectives, too, like efficiency, maybe?). And advances in technology, or entrepreneurial innovation, are both clearly products of the human mind. This power of mind has a tremendous impact and influence on the subject of my research project, as has been made clear in other journals.

The question arises, now, how I will represent this thinking and these revelations in my Self-Designed Assignment for the month of October. I could do something boring, like an essay, which I am tempted to do because I will need a section on this subjective nature of economics for a law review article that I am writing. However, I was pretty impressed with the creativity in my SDA last month, and I don’t want to regress. 

I was playing around with the idea of a poem. But I’ve been telling the kids that the SDA should be bigger and better than the journals, and I don’t know that a poem would be bigger and better than a journal, except that it might take more effort on my part to be poetic. But, also, how much information could I really convey in a poem? It might be appropriate for heady stuff like the human mind, but it also can’t get into details and stuff. Noah suggested that I do a song, with musical accompaniment, and I like that idea because then there will be two elements communicating my lesson, the music, for the heady stuff, and the lyrics for the information. Bott suggested I borrow Duncan Depew for a weekend and write a fictional story that relates to my project. Again, this is a tempting option, because it allows me to be really creative and embellish liberally on the important parts of what I’m trying to convey. And, finally, I was also thinking about a motivational speech, about the world-changing power of human beings. 

One poem is too small to be my SDA. Writing a song and the accompanying music, I think, is too much for me to do in the next 10 days, because it’s not something I do regularly. It is something I want to pursue, though, perhaps for next month. I think I’m going to start out with writing a story. Something with pretty language, too. But, I can’t guarantee that the dialogue won’t turn into a monologue, because I haven’t written fiction since high school. Whether I can still turn that monologue into a compelling fiction story is up in the air. I’m gonna try my best, though, and I think I’m gonna enjoy doing so.

Something I’ve been thinking about for the past week is purpose. I’m working on a law review article that’s somewhat related to my topic. However, I think I’m focusing too much on economics in it. Of course, there’s nothing wrong with an article being economics heavy, but the economics has to have purpose. It needs to contribute something important to the legal part of the essay. So as I write my law review article, I’ve been trying to use a purpose litmus-test to decide whether to include certain things or not. I bring this up because I’m not sure if the SDA this month will be really purposeful, at least in so far as it relates to my final product. Poems, songs, fiction stories, motivational speeches… They fit the theme of the month, but do they fit the theme of my project?

However, Bott told me today that he wasn’t sold on my project, on the idea that I’m trying to sell. And that’s a big red flag for me, that it’s nearly the end of October and my “So What?” is still not clear or compelling. I’ve been telling Alex for over a month now that human beings require no-purely-scientific reasons to believe in something, and, in a nod to new Nobel laureate Thaler, sometimes those reasons are rather silly. Perhaps a beautiful song or a captivating story will better communicate the message I’m trying to deliver than my economic analyses. Therefore, I feel comfortable moving forward with this creative experiment in my more serious project because I want to try different ways of showing people why my topic matters.

J18 - The Human Mind as the Source of Economic Classification

The Marginalist Revolution of the early 1870s was the beginning of modern economic thought. Finally, economists could explain why gold was more valuable than water, i.e., it wasn’t, the marginal unit of gold was more valuable than the marginal unit of water. However, this advancement in human understanding is more properly labelled the Subjectivist Revolution, for the real development was learning that value is subjective, that is, objects are only as valuable as human beings believe they are. The value paradox is solved not through some calculus of marginal units, but through the realization that definite people evaluate definite units of a good for definite human needs, and that this evaluation is inherently subjective and constantly in flux. It’s not so much that the marginal unit of gold is more valuable than the marginal unit of water, it’s that we value the marginal unit of gold more than the marginal unit of water.

Occasionally lost in this focus on subjective value is a more fundamental point: human beings not only determine how valuable a good is, they also determine whether a good has value, i.e., whether it’s a good at all. Chemical elements, combined in various forms to create physical objects, are not inherently valuable, and they are not inherently economic goods. That classification comes from the human mind. If people don’t know that something is useful, or don’t know how to make it useful, it is not an economic good. It does not, can not, serve any human need. It therefore has no value for human actors, and cannot be called a good.

Carl Menger, one of the fathers of the Subjectivist Revolution, wrote that four conditions must be present before an object could obtain goods-character: (i) a human need; (ii) such properties as render the thing capable of being brought into a causal connection with the satisfaction of this need; (iii) human knowledge of this causal connection; and (iv) command of the thing sufficient to direct it to the satisfaction of the need. It should be apparent that at least two of these four conditions (Mises later revised these four prerequisites down to three) are attributable to man. Therefore, the goods-character of things is determined by man. 

Land, or natural resources, is an economic good. Thus, it is not Nature that provides man with natural resources; man creates natural resources out of what Nature has provided, which is matter and energy. This has massive implications for the claim that human beings, through our economic activity, are exhausting the Earth’s natural resources. The truth is that human beings, through our economic activity, are creating natural resources to be used in the satisfaction of human needs by converting bits of nature into resources possessing goods-character. The materials provided by nature are not automatic goods; they become goods only when we become cognizant of their ability to satisfy a human need and obtain command over the material such that we can direct it to the satisfaction of that need. Petroleum comes to mind. As valuable it is today, as integral as it is to our modern economy, petroleum was not an economic good two hundred years ago. 

So clearly Menger’s theory of goods has profound implications for the natural resource exhaustion issue. But I think that it also has implications for environmental issues in my area of focus. You see, if there’s nothing inherent in things that make them economic goods, then there’s nothing inherent in things that make them economic bads. Their utility, and classification, is entirely a matter of perspective. “Waste” is an economic classification. There is nothing about waste material that makes it waste. The classification arises from the fact that we don’t know how to make use of it. And notice that the question is not whether we can make use of it, but whether we know how to make use of it. We live in a world of scarcity: there’s never enough resources to satisfy all our needs and desires. There is, therefore, every reason to convert everything into economic goods that can further satisfy human needs. And everything is merely a combination of various elements; it is theoretically possible that everything could serve a human need, even by being reduced to its chemical components and recombined to form more satisfactory materials (which, in a sense, is the process of all economic production, a transformation of our material conditions). 

There is nothing inherently good or bad about iron. The human mind has made it a good, to the benefit of mankind. There is nothing inherently good or bad about sewage. The human mind has not yet recognized it as a good, to the detriment of mankind. And there is nothing inherently good or bad about changed environmental conditions caused by man. If we can think of a way to have them satisfy our needs, and find a way to cause them to do so, then we will have turned them into economic goods of tremendous value. But, again, it’s not the climate change itself that makes it a benefit to mankind, it’s humanity’s view of it, and the steps we take to harness it. The first step, therefore, in turning climate change into an economic opportunity, is merely to recognize it as one.

J17 - SciTech and Paradigms

One of the tasks involved with serving on a law journal is writing an academic article that could be published by the journal, or some other academic journal. This year, I am a member of the Albany Law School Journal of Science and Technology, or SciTech. So, my article has to relate somehow to science and/or technology, which is not a difficult task for me. Actually, the most difficult part, for me, is finding a way to relate the things I would like to write about back to law somehow.

Now, there’s a definite schedule that writers need to follow in order to make sure that their article is ready by the end of the year. The first deadline on this schedule involved the preparation of a possible topic list and the acquisition of a faculty advisor. Even though we got this schedule before the school year started, I went through life assuming that Professor Hirokawa would be my advisor, since my topic was going to involve the environment somehow, and he’s the environmental law professor. However, I never actually asked him to be my faculty advisor. As a result, I missed the first deadline. I cleared it with my editor, but it was still a little disappointing.

The three topics that I included on my topic list were: i) a plan for privatizing oceans, given that property in this age is considered to be whatever the government says it is, but no government has jurisdiction over the oceans; ii) an examination of the possible legal system of seasteading nations, given their desire to be relatively lawless islands of prosperity; and iii) how the legal system, specifically the common law, reinforce our negative and counterproductive conception of climate change. I’m gonna go with the third option, because it relates directly to my emc2 project and I don’t want to be working on two big research projects at once. However, the connection back to law is incredibly strained. So, I’m gonna have to work on that.

In discussing my topic with Professor Hirokawa, I realized something important. Property, as it exists in our society, is not the Lockean concept of property that is used in economics, particularly Austrian economics. I need to adjust my own idea of property to be more realistic; in this time and place, property is defined by law. It’s not so much that I own a parcel of land, it’s that I own a parcel of land in a residential zone subject to an easement for public access to the creek. My right to my property is absolute, but the definition of my property is constrained by law. Obviously, this needs to be rectified, but, in the meantime, if I’m going to communicate with people in the real world, I need to adjust my descriptions of certain concepts so that I’m not coming from a world of purely mental construction, assuming more from my audience than they can deliver. Moreover, this revelation reinforced the notion that ideas have real power in the physical world. We’re not just struggling against a climate change paradigm. There are many paradigms at work in our society that need to be questioned and reconsidered. That is a quite formidable challenge. And an exciting one.