Say's Law: Logical but Incomplete

["John Gelles" <johng@xxxxxxxxxx>]

        YES--there is a timeless logic to Say's law, 'that
        what people make for trade approximates what
        will be traded'. The logic was there when Say
        lived and continues until now. "There is nothing
        mysterious" about it.

        Does the law imply that people will maximize
        the performance of economic systems so they
        provide for every need? No it does not. The
        law is far from complete.

        The challenge to Say's law talks of demand
        as well as supply.  The challenge began because
        what private sectors supply does not provide
        the needs of billions of people.

        Obviously neither supply nor demand (in a
        profit oriented system) can provide what we
        need--unless profits, too, are designed into the
        supply system.

        How would Say have added that to his law?

        He would have had to observe that there
        were unmet needs whose satisfaction requires
        more profit than trade can offer.

        Say was right, we trade what we make. But
        most of us knew that already.

        We want to know is how to make what we
        need.

        Say's law (and his heirs laws) are all silent
        when it comes to answering that one.

        Gelles' Law states, "Taxless* money systems
        stimulate growth of economic output without
        popular resistance to strategically managed
        profit, investment, real wages, real savings,
        and knowledge of sustainable supply
        systems."

            John Gelles

        *  NOTE:
            The difference between taxless money and
            taxed money is in how you treat it when it's
            being saved instead of spent.
                Taxed money is not protected from
            inflation and so will be spent or sold to fuel
            an inflationary spiral if it gets underway.
                Taxless money is protected only if it is
            not spent or sold--but is saved instead.
            This helps to stop any inflationary spiral.
                Further, it allows government invest-
            ment in new capacity to further fight
            inflation with supply. And here is the rub:
            Gelles law does not say how to keep an
            investment program from being a flop.
            It is a law whose implementation needs
            honest and capable people behind it.
                McFarling's Law says where to find
            and how to train such people.