When I refer to economic actions and consequences I don't usually even think of money. by Jahfre Fire Eater
(libertarian)
Wednesday, June 8, 2011
The way I see it, money is to economic consequences what a tape measure is to a new home...just a standard way to gauge relative pieces used to construct the whole. That's why inflation ruins an economy...imagine building a house where the actual length of an inch grew every day during construction.
The first thing people learn to make economic choices about is how to use their present. Each moment of our lives can only be used for one thing...we can easily divert our attention to an infinite array of unrelated things from instant to instant...but that isn't a very productive use of our time. Even babies eventually find it unproductive to lie there looking at the ceiling. If they are going to move around they need to focus their attention on doing that. That means they must judge the value of moving around to be high enough to allocate more of their present focus to it. It goes on from there...every minute of our lives. Another example, a house wife with no education in any part of the world knows that with one cup of flour only a limited number of biscuits or pancakes can be made. Choosing how much flour to allocate to each product is an economic decision. Humans are economic beings in everything we do, every choice we make. This is what I think of when I refer to economic consequences.
Ludwig von Mises describes human action as something an individual does because based on their current understanding of the parameters, their action will move them from a less desirable state to a more desirable state...even if their very next action seems to be headed in the opposite direction to an external observer. The Actor doesn't care what the external observers sees, only what the likely consequences of their action will be with regard to their desired better state. Deciding whether to take another bite of biscuit or a sip of water rests on an instantaneous assessment of which will bring the most desirable state in the immediate moment. Deciding whether to go into the military or into a family business requires a much longer view of what that desirable state is and how to best go about achieving it.
Our culture instills a sense of entitlement to immediate gratification of desire such that many individuals no longer use their natural ability to comprehend action and consequence. They think that being really angry and shouting slogans in the street will accomplish the outcomes they should be pursuing through constructive political behavior. Too many people think they can alter outcomes with their passion so completely that they cannot fathom why anyone would actually volunteer for the uncomfortable, unrewarding and downright nasty job of defending liberty through constructive participation in the political process.
-Jahfre Fire Eater
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Posted By: Bill Gee
Date: June 9, 2011 07:36:00 AM
Choice - whether economic or otherwise - comes down the Law of Marginal Utility. With every choice we make, we are choosing to not make another. Economists call these "Opportunity Costs". The decision to choose one choice over another as to do with the Utility or gratification one derives from the menu of choices presented. The choice that presents greatest Marginal Utility will be the one the Actor will select and the choice the Actor chooses not to select will become its Opportunity Cost.
Basically the same think you already said in your column, just using economic terminology.
