Fatal Misnomers: “All Dead in the Long Run”

 

For a starter, Macroeconomics is no more economics than Metaphysics is physics. Among other nonsenses, macroeconomics is laden with misnomers. We mean “oxymora in the bad and wrong meaning,” however popular and influential they may be.

             There in English vocabulary is a word “oxymoron,” which is sometimes of Sense and Sensibility; while other times of Nonsense and Insensibility. To the former do such terms as a “graduate student” and a “silent alarm” belong: To the latter such as “an ethical American lawyer” and “the Cambridge Quantity equation” (J.R. Hicks, 1937).

The GOAT: “In the long run we are all dead.” Certainly we are all dead post crossing the River, or posthumous. Equally “obvious,” we are not in Here ante birth, or prenatal. We exist in this world merely in between prenatal and posthumous.    

             To be honest, the rest of us with regard to economy (M∙U∙T^-1 in dimension), micro or macro, are concerned solely about things, matters and events between birth and death (T^-1). The “run” relevant to us is precisely “the while we are alive in Here as defined identity,” no shorter or no longer. As long as economy is concerned, therefore, minding unauthorized (or providential) affairs would be an original sin or a “Fatal Conceit.” 

Science is of the kind. No true scientist would build a theory only on the degree. A theory is first and foremost defined in the kind. The “degree” if ever comes next into consideration, usually in terms of facilitation and that in the forms of comparison or relativism.*

             For instance of differences in the kind:

– Existence (1) vs inexistence (0); prenatal (0), alive (1) vs posthumous (? ≡ 0 for irrelevancy if in science)

– Space (L³) vs time (T¹): A point (L⁰), a line segment (L¹) vs a line (L^∞ ≡ L⁰ if in science);                 a moment (T⁰), a period (T¹) vs Eternity (T^? ≡ T⁰ if in science) 

– Metaphysics (L⁰, T⁰), metaphors(L⁰, T⁰), mathematics (L¹, T⁰) vs (positive) sciences (L³, T¹)     

*Note: Macroeconomics has another grave defect that almost all the so-called “macroeconomic indicators” are “nominal” with no substance at all; in the place, there is the real GDP (“Y”) as “unanimously” supreme indicator which in and by itself is way beyond telling the degree. ‘Each and all” Paul Samuelson “talked about” should have been in terms of variances (L^-1) or variations (T^-1) in the percentage.

Economics. Adam Smith, David Ricardo and John S. Mill, among other “classical economists,” do not care about the degree of any irrelevant kind. They in the first place are interested in affairs of this world, “nominal” or “real.”

             They in the second place are interested in industrial and commercial affairs. They are well aware that “Money, Banking and Finance” is of a different species. Exactly in the same vein, Sir Isaac Newton does not care of air frictions in a theory of gravity. On the sidewalk of Theory proper, “Money, Banking and Finance” is of a good kind of difference while air frictions of a bad kind; whereas all qualifiers are due to intentions of the first person(s). Typically like in  an Eastern saying, "My affair is romantic while yours adulterous." Mine is a vision statement while yours is propaganda. 

             Industry means for creation over time of utilities in the forms of either products for the current period of accounting or assets for the future periods. Not to mention, accounting is instrumental to “economy” in the human and physical powers of creation. Commerce is the generic name for trade of goods, services and assets after division of labor after specialization in comparative advantage. Here again, trade is per period of accounting.

             Then, what is the unit of account, or the metric in the accounting? That’s a real great question! On the flipside of the private accounting in the real hour of time, the public accounting shall be in the legal name of tender. In other words, time is the unit for economy in general, while the name of legal tender is the unit for trade in the community.

Macroeconomics. The antonym of posthumous is prenatal. In this case, the suffixes are intertemporal. The antithesis of the GOAT as above shall be, “In the short run we are all inexistent.” The synthesis: where time is irrelevant, economy and trade shall not exist in substance no matter what in the name. Mathematically saying, M∙U∙T^-1= ∞, when T= 0; which is by design identical to M⁰∙U⁰∙T⁰ (Q.E.D.). 

             A conundrum: What in private or in public would economics, Classical, Marxian or Keynesian, be for? The most reasonable answer would be: “Well, that’s for an inexistent entity (∞) or an existent nonentity (0).”

             At any rate, we “for the sake of convenience” prefer a particular (unit of) conventional analogy to the General Theory of Time Elapsing: “Time flies like an arrow.” “And, that’s the way it is”: All that matters is not intertemporal changes (M∙T^-1) but interspatial variances (M∙L^-1).

             An honest sophist would say, “While temporal run is sleeping, the spatial run steals economics. Stop the Steal! Or, End this Steal Now”

          See, we told you so: No time dimension in the IS-LM, the AS-AD and the Solow growth models. The three are conceived to rest in peace aka “equilibrium” (T⁰). Specifically the economy of the first two models would stabilize in millimeters (L^-1); the economy in the third would grow in tens of hundreds of thousands of nanometers (L^-1) before resting at the Golden Rule (L⁰).

             The wise man Theodore Levitt from Harvard to Eternity would say, “As the GOAT in doing with great efficiency what should not be done, thou shalt name, among others, the Pyramids, the Great Walls, all those refilled ditches, Nationalism and Socialism.  

Once upon a Time in the West. It was many and many a year ago in a Republic across the sea that a political slogan there was which you may know: “The only thing we have to fear is fear itself.” Still so many quarter centuries before across the Strait another slogan there was that we do know: “From each according to their ability, to each according to their need.” 

             In the East a saying there was which some may know: “Shì de, nánxiōngnándì (难兄难弟).” Like older one, like younger one!