HUMINT: In terms of economics, a dollar is a unitized reference for value. Think about it; we trade value everyday in the marketplace; not widgets, services or currency but value. If you’re like me however, you seldom stop to think about the fact that a product’s price is just a reference of its actual value. In a truly free market, Adam Smith philosophically asserts “price is set by what consumers are willing to pay”. Beyond supply and demand, we can see value being traded in the market place when, for example, a customer chooses one tomato over a less appealing tomato. In a typical grocery, the price of a bad tomato is the same as a good tomato – but conscious consumers know the inherent value of each.
If you’ve experienced a value revelation like, for example, Milton Friedman or Thomas Freidman, you’re probably very excited about value. It’s actually a very simple observation to make. If you’re willing to peel the thin veneer off of any free market – you’ll bear witness to value (contained in products and services) flowing into and out of any market place. The net result is usually more value, not less. The more constraints on a market, the more likely value will diminish. Inversely, the fewer constraints on a market, the more likely value will increase.
FLUX: The time rate of flow. For example, volume per hour is the flux of a fluid
If that’s too vague an explanation to formulate good policy, consider the following model. The independent efforts of craftsmen from every corner of the world, if allowed to operate freely, behave harmoniously to create value. Feedback from the marketplace dictates what they produce and how much to produce. The value they create locally migrates internationally to the people who recognize it. A market place is just a vehicle through which value flows. It’s the symphony of free markets that is responsible for improvements in quality of life around the world. Individuals can’t take direct credit for the success of markets but they can take credit for allowing them to operate freely, and protecting their freedom.
Adam Smith’s recognition that value is constantly created by individuals in society and subsequently flows through free markets was a philosophical leap in mankind’s understanding of itself. Thomas Friedman does an outstanding job of organizing and articulating his observations on the subject. He even delves into the implications of technological value flowing into communities who will undoubtedly use it nefariously and profess their will to do so. But why would they use it nefariously? Are they operating under a different set of rules, than you are I? Yes, their rules are very different than our own. One answer; human nature occasionally contradicts Adam Smith theories.
What if Adam Smith’s theories were entirely accurate about the flow of value? But there’s more to life than value. What if there are other social flows transiting between the peoples of the world besides value? I believe there are more flows but are significantly less understood than value. We know mankind acknowledges what it has named. In other words, what mankind hasn’t named does not exist, perceptually at least. Value exists and is easily traded between society’s members only because we’ve agreed to name it and quantify it with currency.
For the sake of argument, let’s assert the evil twin of value is grievance. Like value, grievance similarly stumbles its way around from group to group. Like value, grievance has markets, producers and consumers. Unlike value, it’s never been independently unitized and referenced – at least the way value has been. By observation, value and grievance are related but not substitutive. For example, financial reparations for slavery in the United States could never erase the legitimate grievances created by one race of mankind enslaving another.
Like value, the legitimacy of any grievance is perceived differently by its owners, producers and consumers. International discrepancies of grievance perception are almost always the result of divergent cultural experience. Producers of grievance may not even be aware of the grievance they’re creating. Consumers may not even be aware of the grievances they are consuming. The similarities to value are stark. In the same way, a craftsman may not realize the full market value of their product. So who does? A salesman certainly knows the value of his products. Like value, marketing can either increase or decrease perceptions of grievance. Assuming, however, a legitimate grievance exists, it cannot be erased by marketing or attempts to substitute it with unitized value.
If there is a market flow of grievance, and I believe there is, who are its salesmen? Politicians and statesmen of course! To a lesser extent: dissidents, rebels and terrorists. Each franchise participates in the grievance market. Democracy allows for a less hindered flow of grievance whereas dictatorships, fascists, theocrats all impede the flow of grievance. Recall the concept of market flux introduced earlier. Every form of government participates in the grievance trade just as every form of government participates in the value trade.
And hence society often does create unofficial unitized quantities of grievance… Grievance adorns our self expressions. It can be unitized but is far from uniformly expressed. The currencies of peacefully expressed grievance are: art, ballots, opeds, [now] blogs, to name a few. The currencies of violently expressed grievance are: guns, bullets, bombs, tanks, to name a few. In the transition between the two, society may not be able to distinguish between the unique purposes of each. In other words, the habit of violent expressions will initially find all manner of self expression complimentary to violence.
Without a doubt – democracy more closely resembles a free market for grievance trade than any other form of government. To my mind, that’s why so many citizens believe a linkage exists between peaceful coexistence and democracy. The legitimacy of that belief has yet to be demonstrated but endures for a reason. This is not to say grievances could be eliminated from society through democratic institutions. There is nothing utopian about the grievance trade. Indeed the opposite is true. Rather, remaining grievances are all the more obvious and painful when expressed peacefully by responsible citizens. Should it surprise anyone that the most ardent advocates of free market trade in value are also elected members of successful democracies?
If there is a market in grievance maybe the study of it could reveal some percentage of what we now know about the economics of value, and that would be valuable.