This article is part of a series by Jeffery J. Smith on the surplus—also known as “economic rent”—that exists in the economy. Currently, this surplus is hoarded; yet once shared, this surplus could generate undreamed of possibilities for the entire human population. To see the entire series, visit progress.org/counting-surplus

When doing economics, it’s hard to stay out of politics. Whether asked for their advice or not, some academics advise taxing and spending—prime the pump. Others advise just the opposite—austerity to the people. About the only advice they can agree on is to … practice economy at any cost. How is a policymaker to trust the advice of any of them?

Conversely, when doing politics, it’s hard to keep out of economics. Especially if you can “pay the piper and call the tune.” As the joke goes, when asked what’s the answer to a controversial question, the economist answered, what do you want it to be?

When one sees the experts barking up the wrong tree and society marching like lemmings off a cliff, the temptation to lapse into ideology is hard to resist, even for a researcher. Even at Bloomberg, an important voice in the business press owned by a billionaire, you can find columnists motivated to call for a real solution, no matter how cutting edge. There Dr. Noah Smith, PhD, advised us to "tax the value of locations".

Under Pressure

To be fair, the glorified accountants we call economists don’t have it easy. What they examine is inherently political, much more so than other social studies. How economies function involves some people doing the work, other people capturing the wealth, some people paying taxes, others getting subsidies, some paying tuition, others endowing universities with fortunes with strings attached.

Economists understand this. To survive and thrive, they politely look elsewhere rather than examine property, absentee ownership, rents congealing into fortunes, etc. That’d be controversial.

To downplay the pressure from politics, economists claim to be neutral, value-free (like a bear claiming to be vegan). They busy themselves doing things like observe smokers under a cigarette tax. Check out the bestseller Freakonomics for an endless supply of such correlations. They’re not exactly trivial but it’s like doing human biology without doing anatomy. Bodies do have guts, hearts, and do reproduce according to genes, much like economies producing according to prices. Bodies are not just bodies-in-motion. And economies are not just isolated deals. Something deeper is going on.

No Science

Worrying about controversy makes it hard to look deeper. That leads to ignoring the difference between payments for things others created and payments for things others did not create. Doing that closes off from academic view the essential actions of economies. Hence the discipline can not predict, so it’s not a science, just a discipline. And its disciples can not give sound advice, so society loses needed guidance.

Without the anchor of land, without agreed upon principles, without needing to be right, economists can say and believe anything. In 1974, two economists shared the bogus Nobel prize for saying the exact opposite thing. Since they don’t see reality similarly, that indicates they’re not treating their subject matter scientifically. There is no self-correction among them. There are no basic axioms they all agree on. Do they even agree the sun rises in the east and sets in the west?

While some students of things economic go to great lengths to pose as neutral, unbiased, others don’t. In the previous article, #16, did you notice most writers combined wondering how big the worth of Earth is with taxing it? It makes one wonder if, to have more to tax, they’d exaggerate their findings; that would be bad science.

Potshots

Advertising themselves as unbiased experts, economists invite criticism. Don’t experts need a big-picture perspective? Their professional blindspot toward land takes a lot of internal denial. Further, when Russia struggled to makeover itself to open markets after the communist state gave up, you could read American economists claiming that the Russian economy was doing swell even if the people were suffering. Such insensitivity begs their audience to hold such speakers accountable.

Taking potshots is too easy. There’s almost as many economist jokes as lawyer jokes. An economist knows the price of everything and the value of nothing. And … Ethics teaches us that virtue is its own reward, economics teaches us that reward is its own virtue. And … Don't tell my Mom I'm an economist. She thinks I'm a pianist in a brothel. What’s not a joke is that the field has no code of ethics. Funny, huh?

Neutrality is impossible anyway. Avoiding hard questions reinforces normalcy bias—how things are is how they should be. Further, there are lies of omission (pardon the harshness). By omitting, say, the factor land from their analyses and conclusions, economists tacitly assert that there is no land, that our spending for goods already here is just like our spending for things other humans provide. Which is not so—disastrously not so.

Geonomists

Economists are anything but objective with no axe to grind. Check out the various explanations of the recent recession.

  • Some blame low-income borrowers.
  • Some blame lenders.
  • Some blame government pressuring lenders.
  • Some blame speculators.
  • Some blame regulators.
  • Some blame the absence of regulations.

That’s where most analysts halt their peeling of the onion.

One sees what one expects, and upon finding that does not dig any deeper. Some kept peeling down to the “housing” bubble, but no deeper. Shallow analysis is also bad science.

Only very few were able to explain how such bubbles arise (not “housing” bubble but land-rent bubble, actually). That tiny minority were the geonomists. They were the only ones to predict the bubble’s peak and subsequent recession, in print, in advance—and to an empty house. No one cared! The few who called it right couldn’t get a hearing. Funny.

Those geonomists were successful because they watched the clock—the 18-year land-price cycle. It showed how society’s spending for land swelled and ebbed in a regular pattern. It followed a rise and fall in population growth that demographers had spotted.

The cycle is not a secret but it is ignored. What might bring it to the attention of conventional economists would be if government tracked, measured, and published rents—the money we all spend on all the nature we use. Doing so might fit under the Constitutional mandate to conduct a census.

Commitment

That observation of mine is a borderline political position. See how easy it is to mix up politics and economics together? Like most humans, we investigators are prone to advise and criticize.

Further, the articles cited herein on the rents paid for land and resources may include ideas on what to do with the natural largesse. However, those authors’ political positions are not necessarily mine. My own idea of the greatest good for the greatest number is not shared by many.

I’ll keep my own criticism, opinions, and recommendations in check. Not until the end, when all the facts are in, will I take a position, based on the facts that went before, and reached logically. Knowing I’ll express my views later, I can dispense with doing so now.

If before then, dear reader, you do detect wavering on this commitment to pure science, please be the first to judge and criticize me. We’ll keep this journey to discover Earth’s worth purely on a scientific path.

You must stay around for the whole story. The information is that crucial. Objectively speaking.

This article is part of a series by Jeffery J. Smith on the surplus—also known as “economic rent”—that exists in the economy. Currently, this surplus is hoarded; yet once shared, this surplus could generate undreamed of possibilities for the entire human population. To see the entire series, visit progress.org/counting-surplus

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