The New Economy

The very word ‘economy’ has come to mean something very different from its original meaning. Its etymological meaning is “stewardship of the village or household”, and that’s what it meant until the 17th century, when industrial society began using the word as a shortened form of “political economy”, to mean “governance of the wealth and resources of a region or nation”. The industrial growth economy pushed the definition even further, so that the economy became about the means to increase wealth and resources (i.e. perpetual growth) and about its allocation and distribution (who gets what wealth and resources for what purposes). Neoclassical ‘capitalist’ (political-) economists believe the ‘market’ (i.e. those who have wealth and power) should make decisions about allocation and distribution of wealth and resources. Their policies have inevitably led to ever-greater concentration of wealth and resources (those that have, can get more; those without continue to get none). Socialist (political-) economists believe government should intervene in decisions about allocation and distribution of wealth and resources, sufficiently to ensure reasonably equitable allocation and distribution. The power of money ensures that capitalist politicians (and corrupt politicians that can be bought) prevail in most nations.

So now, immersed in the newspeak of neoclassical economics, we take for granted that “free” (i.e. unregulated, easily corrupted) markets are the ‘best’ way to allocate and distribute wealth and resources, that ‘private’ ownership and ‘enclosure’ (legally preventing others from accessing or using wealth and resources that used to be part of the Commons) are in everyone’s best interest, and are inalienable ‘rights’, and that ‘economic growth’ (i.e. perpetual, exponential increases in the use of resources, production of goods and creation of ‘wealth’) is inherently good for all, or at least for all humans.

To try to explain the New Economy to people who have accepted these (recent) ‘economic’ developments as the way things always have been, are and must be in a ‘democratic’ world, is immensely difficult. It is hard, when you’ve never known anything else, to conceive of a world without centralized ‘market-based’ economic decision-making, without (fiat currency) money, without ‘private’ property, and without debts. Depending on your worldview, such an economic world probably seems either anarchic (and dangerous) or utopian (and naive). No wonder discussion of the New Economy has so many people rolling their eyes. - Dave Pollard