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The Economy

Politics / Recession 2008 - 2010 Apr 10, 2009 - 01:31 AM GMT

By: LewRockwell

Politics Best Financial Markets Analysis ArticleJohn Liechty writes: To date I have twice been robbed of lots of money (or what seemed like lots of money). The first theft occurred overseas when I was at a dinner party. Someone must have seen me at the bank withdrawing cash, and followed me home. Later that night the same someone crawled through an unlocked window and headed straight for the bank envelope. The moral was plain (not that I mastered it) – lock your house and don't be an ass. The latest theft occurred in my native country. I learned about it when a piece of paper arrived suggesting that my "investments" were melting like cotton candy in a squall.

Both losses irritated me, not so much because of the missing money as because of the fact that my own negligence and stupidity were primary factors. All in all, the second rip-off irritated me more. The robbery of money from my house was, so to speak, a good honest crime. Somebody went to the trouble of watching the bank, tailing me home, and crawling through my window. For his enterprise, the thief ended up with a wad of what had recently been mine. Who knows, maybe he repented and sent the money to UNICEF. Maybe he used the windfall to go to seminary, or study ethics or post-modern semiotics, or anything to make the world a better place. I hope so. On the other hand, my thief likely just went off on a colossal bender. That's what I would have done. One way or another, the cash got spent.

The latest theft was less straightforward, and I am not evolved enough to understand it. You need a PhD in economics or years of government service to really grasp money-melting. What embarrasses me most about the disappeared funds is that "investing" was never my idea. I understand money in cigar boxes and gold bangles on wrists. But I allowed myself to be steered against my instincts. What did the investments mean? I never knew. For a while it looked like I was making money by doing nothing. I suppose I was supposed to feel good about that, but I didn't. It didn't make sense. Spreadsheets started coming in the mail, but they didn't make sense either, as I never learned to read them. Meanwhile that figure – my net worth – kept going up. It gave no real pleasure, it was just a number, but by God it kept going up. Then one day I opened an envelope to find that my fiscal boner had, as we used to say in junior high, popped.

My dictionary defines economy as: "Careful, thrifty management of resources, such as money, materials, or labor." That strikes me as all anyone could possibly need to know on the topic. But there are several additional points on Economy that I think I understand, and I will belabor them all. One is Chapter One of Walden . I admire the way Thoreau knows where every penny went. Economy, he says, is simply a matter of attending to basic needs – Food, Shelter, Clothing, Fuel – as well as a constant matter of attending to the concept of Enough. The total expenditure for his first year at Walden Pond came to $61.99 3/4¢. (He made most of it back.) Thoreau clearly cherished that quarter cent short of $62. "I can live on board nails," was his comment to the skeptics. "If they cannot understand that, they cannot understand much that I have to say." If we understood living on board nails, we might be less disposed to understand living on bailouts.

Another literary lesson in economics simple enough for me to grasp is the famous precept of Dickens' Mr. Micawber: "Annual income twenty pounds, annual expenditure nineteen pounds and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery." In other words, don't spend more than you have…. This is not, in the overextended cliché of the age, rocket science. And yet it is a concept beyond the walnut brain of the stegosaurus we refer to as government, which feeds on war, debt and waste, result misery.

And finally, a practical lesson in economy that has stayed with me over the years. When I was 15, I was invited to catch chickens by a friend. His great-uncle and mine, a man who made Thoreau look like a wastrel, was running the operation. We showed up well after dark on a hot July night, and were released among the fowl. The broiler-house was appropriately broiling. And the smell was unique. Shit stinks, of course, but stink is not a pungent enough verb for what chickens do. We sweated and gasped through swirling feathers and dust until the last bird was on the truck.

When at last I went crawling up to my great-uncle, embraced his shins, and kissed his feet, I was under the impression that I deserved to be made rich. The great-uncle reluctantly peeled three limp dollars off a roll and let me have them. He said I'd worked somewhere in the vicinity of an hour, and I'm sure he was right. I went away from there understanding something about economy. Those were three dollars I did not spend lightly, nor did I let anyone steal them.

John Liechty [ send him mail ] currently teaches in Muscat, Oman.

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