Wednesday, June 27, 2012

Lies, Damned Lies, and Definitions, VII: Re-Editing the Dictionary

One of the most frustrating problems we encounter when dealing with the world from a natural law or Just Third Way perspective is the ease with which (other) people change definitions to suit their own purposes. While this would appear to be simply another manifestation of the moral relativism so widespread today, it does have "practical" considerations — one of which is that it becomes virtually impossible to figure out what somebody is talking about if he or she constantly changes definitions of terms.

With any discussion built on such shifting sand, objective evaluation of the problem becomes virtually impossible. The relativist will, like Humpty Dumpty in Through the Looking the Looking Glass, simply tailor terms to suit him- or herself, if that's what it takes to "win" an argument or close off a discussion — and gain power over another.

Nowhere is this more evident than in the roots of the current financial and economic crisis. It can with justification be said that, with the near-universal adoption of Keynesian economics with the "New Deal" of the 1930s, "the whole world groaned and was astonished to find itself Keynesian."

The problem is that Keynesian economics is, to all intents and purposes, an application of pure moral relativism to economics and finance. Keynes himself acknowledged this in the book he intended as his magnum opus, the Treatise on Money (1930). As "the Great Defunct Economist" announced in the opening passages of that work,

"It is a peculiar characteristic of money contracts that it is the State or Community not only which enforces delivery, but also which decides what it is that must be delivered as a lawful or customary discharge of a contract which has been concluded in terms of the money-of-account. The State, therefore, comes in first of all as the authority of law which enforces the payment of the thing which corresponds to the name or description in the contract. But it comes in doubly when, in addition, it claims the right to determine and declare what thing corresponds to the name, and to vary its declaration from time to time — when, that is to say, it claims the right to re-edit the dictionary. This right is claimed by all modern States and has been so claimed for some four thousand years at least. It is when this stage in the evolution of money has been reached that Knapp's Chartalism — the doctrine that money is peculiarly a creation of the State — is fully realized." (John Maynard Keynes, A Treatise on Money, Volume I: The Pure Theory of Money. New York: Harcourt, Brace and Company, 1930, 4.)

Most people reading this passage simply do not realize the utter enormity of what Keynes claimed. For that reason, while we've presented our arguments many times before, we will examine the Keynesian revelations once again in this series, and test them against our understanding of the natural law common to all humanity.

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