tag:blogger.com,1999:blog-4413935813892441553.post4056740548380545579..comments2024-03-29T00:30:39.262-05:00Comments on real economics: The Obama administration as “managed democracy"Jonathan Larsonhttp://www.blogger.com/profile/05217670446743983955noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-4413935813892441553.post-49081429047953853382010-05-24T16:50:22.785-05:002010-05-24T16:50:22.785-05:00I want to thank Tony for this. It was fun having ...I want to thank Tony for this. It was fun having Tony around and I got to take him to the ultimate Veblen "shrine"--the Minnesota farmhouse. I have conducted a bunch of tours over the years, but this was different. Most Veblen scholars are collectors of minutia of the life of a famous writer. Tony showed up with the ability to do Institutional Analysis--Veblen's most important contribution to humanity's intellectual architecture.<br /><br />Here's why this is cool. Institutional analysis is a simple idea--bankers will act like bankers, teacher will act like teachers, etc. and because this is true, it is possible to make fairly accurate predictions about the course of human events. Simple idea--incredibly hard to do. Why? Because if you have an intellectual plan that relies on the assumption that bankers will act as bankers, etc. you have to know what that means. And it's the etc. part that makes this so hard--you have to know how a near-infinity of occupations behave because it is in their interest to behave a certain way,<br /><br />Back to Tony. Because he spent nearly two decades diligently examining the deliberate destruction through plunder of USA industrialization, he already knew enough to do high-level institutional analysis without exactly knowing there was a name for this form of thought. He had learned how to do Institutional Analysis the same way Veblen did. Think I exaggerate? Try these paragraphs:<br /><br />"In fact, as an industrial enterprise grows and matures, its trained and skilled employees make the surrounding community a pool of technical talent that is highly conducive to the creation of other industrial enterprises that use the same or similar skills. That’s why certain towns and cities become known as centers for specific industrial products. Sheffield in England was known for its highly specialized alloy irons and steels. Delft in Holland is known world-wide for its blue pottery. The Hocking River valley in southern Ohio became known in the 1800s as a center of brick manufacture. The Connecticut River valley was known for almost a century as “Precision Valley” because it was a center of designing and making high-precision metal-working machine tools. Detroit became known for making automobiles. Today, almost every high-speed, high-volume printing press in the world comes from Heidelberg, Germany. The southern part of the San Francisco Bay area became known as Silicon Valley.<br /><br />How much is it worth to have a locale or city renowned for the technical excellence of its local enterprises and workers? What value can be assigned to having a few hundred wizened old men around who can train entire generations of new, highly-skilled workers? Or who have a few different ideas than their boss, and decide to start up their own company? The value must be very high, because thousands of national, regional, and local governments around the world have spent hundreds of billions of dollars over the past two decades trying to create “incubators” of new technologies, new companies, and new “employment opportunities.” Such a great irony: finance capitalism is unleashed and destroys the social organizations of industrial enterprises in which technical excellence is revered and rewarded, and the public worldwide has been forced to pay billions of dollars to fund a poor replacement."<br /><br />Thanks TonyJonathan Larsonhttps://www.blogger.com/profile/05217670446743983955noreply@blogger.com