The Price History of Campbell's Tomato Soup

He notes a bunch of legitimate but ultimately pretty minor criticisms of mainstream economics[1], has one actually solid argument[2] that he doesn't bring up until his conclusion. And uses that to advocate for throwing out all of mainstream neoclassical economics and all of mainstream macroeconomics, and do something totally crazy: replace it with thermodynamics[3].

He closes saying "But I’m also a hard-nosed scientist who dislikes analysis with dubious assumptions baked into it." He uses a bunch of minor criticisms and one core dissonance to argue for throwing out the current paradigm of economic science. Those "dubious assumptions" are the core of the current paradigm of economic science: that markets basically work most of the time. Believing that he's the smartest person in the field, he discards the established methodologies and replaces them with the mis-application of a more tractable field; he's doing what is sometimes referred to as quack science.

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[1]: Yeah maybe the framing around some analysis could be better (the bulk of his arguments). Yeah, it's problematic to use one price index for one part of a comparison, and a different price index for another.

[2]: Through the article, he shows that the chart is relying on believing that markets correctly value total economic output, but that markets are getting production workers' wages wrong. He doesn't call out this discrepancy until the conclusion though. IMO, it's the only argument he makes that really "debunks" the graph. However, there are lots of arguments that I can imagine economists making as to why the market gets things right or wrong in specific cases. However, he proceeds to argue that if you don't believe the market is valuing labor correctly, then why should you believe that it's valuing anything correctly. That you should totally abandon the idea of using markets to value things.

[3]: I kid you not. He writes:

> When you think this way, you realize that ‘useful work’ (the amount of energy put to an end use) is a good indicator of economic output. I propose that we treat useful work per labor as an alternative measure of labor productivity.

The author carefully words this so that it sounds reasonable. "'useful work', yeah, that sounds like a good way of defining 'productivity'." There are two big things wrong here:

1. How do we quantify "useful"? My first reaction was: OK, sure, but the measures that you're proposing to use this instead of are measures that let the market decide what's useful and how to value that. That's the type of thing that markets are supposedly pretty good at most of the time. If you want to argue that the market's getting it wrong in this case, that'd be one thing. But lets see how he proposes quantifying it, if not by markets...

2. ...oh, "useful" is just a fluff word, and he pulled a switch-a-roo with "work"! The casual reader might think that he's talking about something somehow connected to labor, but he's not! He's talking about physics-class thermodynamics "work".

My jaw dropped, I laughed out loud. He's seriously proposing that we stop measuring the productivity of labor by any human-level measure of value delivered, and instead measuring it by how much electricity and fuel is used! He even says this:

> ‘Useful work’ is based on the laws of thermodynamics. The standard measure of productivity, in contrast, is based on the dubious assumptions of neoclassical economics.

Yes, because thermodynamics is totally relevant here. But hey, it's a hard science™, so it's always better than drivel coming from the soft sciences, right?

Cutting back on luxury spending, like sending people to the moon, could be connected to a general belt-tightening, in line with a sudden curtailment of per-capita energy growth (World per Capita Energy Consumption, 3/4 of the way to the bottom of the page).

It would be a bit suspcious if in 1972 there are astronauts were on the moon, then after 50 years of exponential real economic growth there is nothing going on, even to show off.

Perhaps it’s obvious to you, but I actually found the parent’s suggestion to be thought provoking. If you’ve got a strong justification to back up your strong opinion, I would be interested to learn more.

Admittedly it’s not something I know much about, but it certainly seems plausible that allowing the Fed to print unlimited amounts of money could lead to inflation. And, as that website suggests, that inflation could disproportionately benefit people who own things that retain value (real estate, stocks, etc) or who have good credit ratings and are able to borrow during inflationary periods.

Economics tells us that inflation in the current format is a massive source of inequality. The 1-2% purchasing power lost every year doesn't just disappear: it is transferred to the first spenders of the newly created money, which is overwhelmingly banks and financial institutions (which receive it from the Fed). Literally making the rich richer and the poor poorer. Yes in theory that might not be the case if the newly created money was distributed by UBI or something similar evenly to all citizens, but that's not what's happening.

>It actually pisses me off that someone is peddling this horse manure to promote their private money scams, and they have the brass neck to blame all the world’s ills on public monetary policy in order to enrich themselves.

Jeff Bezos doesn't have $50 billion of wealth in cash, he has it in inflation-proof stock. Inflation doesn't hurt him, but it does hurt 50 million Americans with $1000 each in the bank, especially given lower and middle-class Americans have less access to financial products to hedge against inflation.

If Goldman Sachs was granted the right to print US dollars, everybody'd be up in arms, yet when the Fed does it and gives it to Goldman Sachs suddenly nobody cares any more.

>Economics may well be the dismal science, but it is luminary enough to instruct us that restoring gold convertibility to the US dollar has zero chance of solving problems such inequality and government budget deficits.

Your last sentence is pretty loaded. "Solving" those "problems" would imply that, first, they are indeed "problems" that need solving, and second, that there is actually a way to "solve" them. Some people just think that the world would be a better place if governments don't have control over the currency. No need to "solve" the world, just make it a little bit better (or less worse).