Tuesday, June 29, 2010

Economics of Recess

Yesterday I had a long discussion with several people about the nature of capitalist economics. Frankly, I just don't get it. I mean, I get some of it at its basics in theory, but the way we do things now is an unruly system that's far too complicated and risk-based for its own good, I think. Maybe I just have a hard time seeing it in macrocosm.

The whole discussion reminded me of an episode of Recess which I think boils down American economics pretty well. To me, it's a cautionary tale; investment sounds like a good thing but can bite you back, greedy corporations eventually bring down the entire system, money's only worth anything as long as we think it is, and the American myth of upward mobility can be dangerous.

I suggested to someone last night that when "speculation" and price gouging lead to excesses, there should be a limit. I cannot believe that inflation is just a natural occurrence. "Supply and demand" sounds reasonable, but in practice leads to extremes that hurt everyone. So I suggested something like making a rule that the price of something cannot exceed so many times the cost to produce that thing. To me this seems reasonable. Does this mean someone has to be in charge of these rules? Yes. But why is that necessarily a bad thing? Isn't that what government is for?

Here's the episode I'm talking about. Watch it, and decide how well it reflects real situations, albeit in a cartoon microcosm. And note the contract at the end; if I'm wrong in the above paragraph, then isn't this wrong too? And feel free to leave me comments about how I don't understand what I'm talking about. Because I don't.

2 comments:

  1. reccess has always been pretty accurate at reflecting real-life issues. TJ's actions remind me a lot of our economy

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  2. Yes this episode of Recess is a cautionary tale and does represent a capitalist society fairly accurately. However the message is not that we need externally imposed limits but that we need to beware of what greed can do to us. The economy is somewhat simplified implying that all of the workers are equally competent and interchangeable. What is accurate is that all of the personalities represented are seen in the greater world. Mendel models the same arrogance that TJ grows into but as he inherited his stickers, he fritters them away. As TJ began to earn stickers he became angry, power hungry and mean. His gang is particularly enlightened in they recognized that TJ’s behavior had brought down the playground economy, stressing people to the point that they changed the exchange base from Mon stickers to Alien standard. Notice that TJ reverted to the same greedy behavior after he signed the agreement. So if the gang’s agreement is analogous to government regulation, TJ totally missed the point, he lost his friends long before he brought down the playground economy through love of money. Empathy and value of the intangibles of life just can’t be legislated, it must be internalized.

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