Selling Oil and Buying Fighters

["John Gelles" <johng@xxxxxxxxxx>]

        The price of oil may be $25 a barrel. The price for one
        month's service, by someone (good at killing and obeying
        orders) to fight on your side, may be equal to the price of
        four barrels of oil.

        I say "the price may be" instead of  "the price is" because
        these prices affect each other and they are continuously
        changing.

        A similar comparison can be drawn between the price
        of full employment, or the price of raising the minimum
        standard of living, and the price of failing to do either.

        Of course, there is real market where oil is sold and
        bought. But there is no real market where you can buy
        turn-key fighters, full employment systems, or ways
        to raise living standards. These things are not for sale
        like a barrel of oil. But their cost can be measured and
        discussed as though it were a price.

        What we discover in such a discussion is that markets
        may arrive at prices, and may even seem to arrive at
        a pre-programmed distribution of power and wealth.
        But the seeming is an illusion.  Markets have no mind of
        their own. They can but reflect the minds (or absence of
        minds) attempting to change the world or keep it just as
        it is.

        At the moment the minds on our side seem to have
        paid the right price for our fighters. Oil remains cheap
        and democracy is again on the march.

        Our side's central banks and national spending
        authorities have taken aim at ending the global
        response to recent capital asset bubbles. They
        have cheapened money a bit and are ready to buy
        a lot of repair and a decent measure of growth.

        They have not been harnessed to a fiat money
        revolution to engineer growth in peace the way we
        do in war. In fact, they they have not even done it
        for this war -- which we may be winning so fast that
        we'll lose its great opportunity to have given us a
        rationalized global economy like the one we called
        "lend-lease".

        It has been suggested on this forum that it is easier
        to rein in inflation that work our way out of a slump.
        Mere spending won't do it, because if it could every
        nation with a mint would be rich. Only spending that
        results in production of things which, in themselves,
        raise the minimum standard of living, will do.

        And to produce such things you need more than a
        market -- you need objectives, strategies, and
        intelligence, all combined in a system that moves
        a society forward and corrects its mistakes on the
        way.

        John Gelles