What have we concluded in our exploration of Keynes and his General Theory? We have concluded that an economy without demand is in trouble, and we have concluded that the likelihood of a State stimulating demand decreases as the economy becomes more wealthy, technological, and complex. State efforts to create demand then might perhaps have unintentional consequences, say increasing wealth inequality, shrinking the middle class, and the like, a claim often made by Web 3.0 users who support cryptocurrencies — many can be found arguing the Federal Reserve has wrecked the lives of average Americans in their efforts to create stimulus — but I will let those others argue that case and let interested readers research the topic for themselves.
Regardless, we can say that for Keynes the further demand falls below the DEH, the longer it will take for the economy to recover, and if for some reason demand naturally drops as a society becomes wealthier, then we should expect wealthier nations to grow slower with time and even stagnate, possibly falling below the DEH. This is perhaps why what Tyler Cowen and Peter Thiel discuss regarding “technological stagnation” has occurred (Tiel famously discusses how we’ve really only seen innovation in the world of bits but not in the world of atoms since around the 1970s). Is there something about wealth which shrinks demand? Perhaps, a case that might gain strengthen given how it’s First World Nations which need psychoanalysis according to Freud. Does wealth somehow make us stop wanting it? Or does wealth end up growing itself in a way that even if we want it, we cannot get it (an argument which might favor “sound money,” as Web 3.0 can discuss). Hard to say.
For more on this topic of “demand,” please see this talk with Layman Pascal.
Keynes makes demand primary, but how do we determine what demand “is?” Socrates helped us realize that we speak of justice in law without being able to define it, as we often speak of goodness, freedom — is a Socrates needed in economics? Perhaps, but my point is that if we cannot assume the State can create or stimulate demand under any and all circumstances, then this forces us to consider what demand “is,” for we cannot assume it will just “appear” if we create the right conditions. If we know x will always be there if we do y, then knowing what creates x directly isn’t pressingly; making x “appear” by “summoning it,” per se, with y is “practically enough.” Likewise, if we could assume that State spending would “summon” demand, then that would be “practically enough” and we would “practically know” what constituted “demand” (even if we couldn’t say). In economic modeling, “practically knowing” and “actually knowing” is easily identical in terms of quantification, and there really aren’t grounds to say that “practically knowing” something is worse than “actually knowing” something (if we can get away with it) — that’s not my point. Rather, I’m saying that as a nation becomes wealthier and more complex, it is probably not the case that “practically knowing” what constitutes demand will be enough. We need to transition into “actually knowing” and understanding demand, for otherwise we will keep drifting into Discourse from Rhetoric (easily without realizing it).
“Actually knowing demand” will in my view require regaining a sphere to discuss “value,” as this conversation at Voicecraft emphasized and explored.
Keynes argued that “demand” is fundamental to the market, and that no “equilibrium” will save us from “involuntary unemployment.” But what is demand exactly (so that we might “actually know”)? Well, it’s obviously a demand for goods and services, but why do we demand x goods/services vs y goods/services? Yes, yes, we demand food and shelter because we’ll die without them, but why do we demand Starbucks? Because we need coffee in the morning to function? Sure, but why did we pick Starbucks instead of McDonalds? Because it tastes better? If so, that means “the value of taste” is our highest value in this circumstance, but why not the value of “corporate mission?” Why do we pick x value to be the value according to which we make our decision versus y value? And how do we even “evaluate” taste? What does that mean?
For me, we need to connect “demand” with “creativity” and the Artifex, which is generally the class who “creates the means of production” (from my paper on Marx, “The Creative Concord”). Marx breaks the world down into those who own the means of production and those who work it, but I believe we need a third class, the makers of the means of production, and this is critical for understanding where “demand comes from.” Currently, we speak as if “demand” is just out there, emerging between owners and workers, but if nothing was ever created, nothing would be demanded (beyond basic necessities). Demand is created and toward what is created, and creativity “comes out of” human beings. If this is the case, then creativity and values are intricately connected. Furthermore, if demand collapses, rather than the State fix the problem, in a society high in creativity, demand could be restimulated with the invention of new means of production. In this way, there would be “the results” of central planning without the concentration of power or inefficiencies I think Hayek rightly outlined.
If markets don’t “always take care of themselves,” as Keynes basically argues, then what ultimately runs the market is demand, and demand is ultimately a reflection of what we “value” (“the creative act” is indivisible from “the valuation act”). If (Nietzschean) Children create their own values, then we must be Children to create our own demands on ourselves (versus “be demanded”), and furthermore only Children can be an infinite source of demand(s) which isn’t oppressive. If demand is a demand for value, and yet what we value is what we demand, then what we have is a “closed loop” and “true infinity” that could be a source of infinite wealth if we could create “the whole circle” together as one. This is what Children can do, and thus “spreading Childhood” is to spread the conditions of possible infinite demand, thus saving us from the DEH due to a decrease and/or loss of demand. But what if the demand is infinite but not coordinated because all the Children just want to be painters? That’s admittedly a risk (there is always risk or there is oppression), but “coordinating demand” requires a central planner, and that runs us into the possibility of oppression, which our consideration of “the problem of scale” is dedicated to avoiding. Furthermore, this might be where Artificial Intelligence and automation prove invaluable, for they could “fill in the gaps” where demand is needed but the infinite demand of Children isn’t coordinate “toward.” That’s assuming any problem emerges at all, mind you, which might not be the case.
In my opinion, demand is modeled in economics as if it is just “there,” and yet if Keynes is right that demand is central to economics, it is my view that we should seek a better understanding of its constitution and nature. Wealth follows demand, but from where does demand come? Furthermore, is there only one “form” of demand, or is there a difference between “the demand of Rhetoric” and “the demand of Discourse?” I believe there is, which means culture matters, and the shape of culture will shape demand. Perhaps we can assume there is always “pent-up demand,” but we cannot assume this demand will reflect Discourse or Rhetoric (that depends), and we also cannot assume that all demand equally contributes to an “investment multiplier” equally. Furthermore, some demand might contribute to Childhood, while other demand might contribute to its effacement. It all depends, but again perhaps a reason we have not examined “demand” is because we do not want to ask about our wants (consider Lacan), and it is furthermore possible for us to avoid such questions by simply consuming, which sure enough requires some kind of demand and thus can be seen/rationalized as economically valuable. Unfortunately, that particular manifestation of demand easily feeds and strengthens Discourse over Rhetoric, which means it will not contribute to “the spread of Childhood” and thus not help us address our self-effacing problems.
To use a wonderful metaphor from Chetan Anand, which he gifted us with in “The Net (65),” demand today functions like a “rumor,” which is to say it comes and goes, seems to originate from nowhere, then everyone is talking about it. A rumor is like the wind and gains a life of its own, and is a notion which is cut from its origin. The origin isn’t questioned or known, for if it was the rumor would easily die and fade. A rumor is a product of what Andrew Luber calls “devastating forgetting” (a point which suggests our relation to Being according to Heidegger), which is when we forget the origin and as a result lose a capacity to identify and understand. Now, please don’t mistake me: “demand as rumor” can certainly work and benefit the economy, but again my point is that “practically knowing” demand might prove insufficient and fragile if we hope to maintain demand moving forward without worsening “The Meta-Crisis” and failing to “spread Childhood.” Furthermore, “demand as rumor” might be uniquely susceptible to manifesting Discourse instead of Rhetoric, priming us to end up in Kafka more than end up as Children.
For more on Kafka vs Orwell and Huxley…
When most people discuss “creating demand,” they actually mean “stimulating demand,” and I certainly don’t have a problem with using the term “create” in this way. However, we mustn’t forget the technical difference between “create” and “stimulate,” for if we must “create demand,” we will have to understand it better than like a rumor. In my view, most of the time in economics when we discuss “creating” we actually mean “stimulating,” and perhaps we should be alright with that in economics; after all, do we really want economics to become philosophy? Well, if economics is to “create demand,” I think that move is necessary, for there is a limit to how much we can stimulate without better understanding what exactly it is that we are stimulating.
Where “demand is rumor,” I am also of the opinion that demand is more likely to reflect and benefit “materialism,” both as a worldview and as a consumptive habit (Discourse). If it is true that the State cannot easily create demand as a nation becomes more complex and technological, then the State might naturally move into stimulating demand by simulating spending and consumption, and a key way they might maintain that is by creating values which motivate people to so spend and consume. That would be materialism, and it becomes easier for people to be materialists if they also believe that “the material world is all there is,” hence why “economic materialism” and “worldview materialism” might accompany one another. Furthermore, both types of materialism might ideologically benefit and strengthen one another, for even if we believe “materialism is bad as a worldview,” if we still believe “the material world is all there is,” we will easily still “practically be materialists” in our consumption habits, or at the very least we will lack moral weight and authority to stop other people from being “materialists” in terms of their values. Perhaps a reason we even need “The Meta-Crisis” today (as a “forcing function”) is to figure out how to separate “materialism as a worldview” from “materialism as a consumptive habit” (MW from MC): after “the death of God,” it seems we lack “divine authority” to divide MW from MC, but an “apocalyptic crisis” might make up for the loss. Hard to say, but at the very least we can see how difficult it is to separate MW from MC, and where “demand is a rumor,” this division might be all the harder and perhaps impossible without referral to some apocalyptic threat. I’m not sure.
Where the origin and source of demand is not understood, we will mostly have to stimulate demand versus create it, precisely because we don’t know how to create it (for we don’t really know what it is), and “after the death of God” it seems that all we really have “at scale” to stimulate is material goods. And why should these “stimulate demand” if we cannot form values around consuming materials that justify the act? Sure, we still can, but morality and ethics are important to help people understand and “live with” what they are doing, and if people are materialistic in their consumption without an ethic which justifies them doing this, it can prove more psychologically difficult on them. Thus, MW can help MC, for if “matter is all there is,” it’s harder to blame us for being “materialistic” in our habits. In this way, the hope of maintaining demand might incentive a society to keep MW and MC together, which might cause “The Meta-Crisis” and prove dire in the consequences. If we are to escape this incentive, we will likely have to move from “demand as rumor” to “demand that’s origin we understand.”
Perhaps a reason First World Nations seem to fall into stagnate growth with time is precisely because people eventually “experience for themselves” how materialism is a poor value system, and when so the ability of material to stimulate demand decreases and expires (as perhaps evident with “The Meaning Crisis”). However, where MW is the case, once people become dissatisfied with MC, they only have material and materialism for which they can turn, and that might lead to hopelessness and nihilism. When people are nihilistic in this way, they can then lose motivation and so cease creating demand. Nihilism in this way is a direct threat to growth and economics, and though perhaps this means Nihilism might help “Game A” from becoming cancerous, consuming all resouses, and/or destroying the world, this “solution” to our problem doesn’t not seem adequate or appropriate. We need to “spread Childhood,” and that means we must “spread the conditions which make it possible for us to always create values and demand.”
Where “demand is a rumor” and stimulated, we seem to end up between MW and MC, with the two both justifying one another (it is always to be an MC because MW is true, and MW is “practically true” for those who follow MC). Perhaps this is a key characteristic of Game A, and so figuring out what demand “is” is a step for addressing Game A with Childhood (and the proper address might also be the proper address to Belonging Again, as I think is the case). And indeed, we have already discussed how economies are most fundamentally “a dialectic between energy and creativity,” and so we can see the origin of demand as from this dialectic. Alright, fair, and we can also say that a Child is someone who participates in this dialectic and honors it. If this is so, as I think we have argued, then we can say that “spreading Childhood” is “spreading what creates demand” (versus just stimulate it). And if Keynes is right that demand is what makes an economy possible, then we have suggested that “the spread of Childhood” is the spread of the possibility of an economy and even “new kind of economy” that is driven by “a demand of Rhetoric” versus “a demand of Discourse.” This is part of our overall work in addressing “the problem of spread,” and so we have reason to think that “spreading Childhood” will not be an act which threatens and damages the economy. In fact, we have reason to think that it will elevate it.
We have mentioned that “for some reason” demand seems to naturally drop and decline as a society increases in wealth, which creates a problem where First World Nations tend to slow in growth, which forces the State to then “stimulate demand” (which it often calls “creating demand”) in order to keep the economy active, as is especially necessary if the economy is debt burdened and obligated to pay numerous pensions and the like. In not really knowing what demand “is” but knowing what stimulates demand, the State tends to then increases incentives to consume, which can then worsen materialism and set people up to seek “objects of desire.” But if Lacan is right that no “objective of desire” ultimately satisfies us, then this is a mistake which might lead to a system that arranges incentives which lead us to a place where we become disheartened and discouraged. This is perhaps “The Meaning Crisis,” which is also a “Desire Crisis,” which is a “Motivation Crisis.” We have desired objects, and when those objects have failed us, since we know of nowhere else for desire to go, desire ends up dying. But in truth desire is not meant for objects, which is to say that once desire is made to operate according to “low order causality” it is structured by Discourse and either exists pathologically materialistic or rather ends up effaced and no more. For desire to be “rightly ordered,” desire needs to be “high order,” which is to say desire is structured according to Rhetoric, and when this occurs, demand can also be structured by Rhetoric. And all of this can be described as a practice of “internal coordination,” which economics has been tragically lacking.
As highlighted in “The Intrinsic Value Model” (as just one example), Anthony Morely at Intrinsic Research Co (whose work has been invaluable to me, both in terms of economics and Leibniz — he taught me everything I know about Leibniz), declares that we need a new framework for economic theory, because “supply and demand” are no longer as relevant as they once were, seeing as “supply and demand” only describe “the price coordination side” of economic activity, not the “internal coordination” side, which is what we spend most of our time during on the internet and in digital spaces. It is what most of us our doing right now, online, internally coordinating, collaborating toward certain goals, self-organizing (as Bonnita Roy discusses) — this is “the form of labor” that produces economic value in the context of digital media, digital assets, and all other “useless spaces” where self-organizing and emergence is occurring. The phrase “useless space” is important there, for it suggests leisure, the work of Josef Pieper, and also the work of Julian Benda who warned we must always preserve and honor a “useless space” in education, or market and “practical forces” will come to control and “capture” everything. Whatever happens in a “useless space” (or space that isn’t coordinate by traditional pricing mechanisms) is that which is driven by “internal coordination,” and ultimately all demand is “internally coordinated” before it is “price coordinated.” Hence, we cannot say “demand is what is coordinated by prices” as if that addresses the “internal coordination” which beget demand. It does not. More work must be done.
For Anthony, until we recognize the role of “internal coordination” in economic activity, we will not generate a new “theoretical framework in economics,” and I agree. I hope to contribute to that new work with “the dialectic between creativity and energy,” and I also see Timenergy by David McKerracher as aligned with the work (as I discuss throughout Belonging Again (Part II)). Additionally, I believe “internal coordination” is made in the image and likeness of either Discourse or Rhetoric, which is to say we can be internally coordinated like Kafka (“low order”) or internally coordinated like Children (“high order”). Currently, our economic frameworks leave us to end up in Discourse and Kafka — the work of Anthony is to free us to an alternative, but that requires us to think the “nonrational” and “high order” — difficult endeavors which do not align with “trivia education,” but fortunately “Net Tradition” might be changing us “qualia-tatively” to be ready and better at it.
Economies are most fundamentally a product of “internal coordination” before they reflect “price coordination,” but economic theory today seems to only focus on “price coordination,” which is necessary, but it is not enough in an age when “practically understanding” demand is now insufficient. Ultimately, as I think Deidre McCloskey helps us understand, economics are creations before they are “products of price coordination,” and at the root of the “internal coordination” which makes economics possible is “a dialectic between energy and creativity.” What we desire is what is created from this dialectic, and there would be little to demand if anything without it (certainly “demand” and “wealth creation” wouldn’t overlap).
To speculate, perhaps we have wanted to believe “demand” reflects basic infrastructure and economic necessity, because if we spoke instead of “desire,” we’d be more likely to reflect back on ourselves and our desire, which can be existentially difficult and uncomfortable. However, perhaps speaking of “demand” instead of “desire” has made it easier to avoid the existential and metaphysical questions we should be asking regarding demand, and by extension this has made it easier for us to mistakenly think that us “practically knowing” demand is the same as “actually knowing” demand (as again there might be existential incentive for us to do). Also, if the “market takes care of itself,” we never really have to ask about our desire, for desire “caries us along” without us asking too much about it. Sure, we desire all the while, but its not hard for us to think of ourselves as “responding to market forces” and “just getting what we need.” If, on the other hand, we started speaking as if “demand wasn’t given” (as I think economists often do), then demand might turn into a mystery to us, and faced with that mystery, what questions might we ask? What answers might we stumble into? If things don’t just “take care of themselves,” what is it we desire? That which helps things along (Rhetoric) or that which hinders them (Discourse)?
The more we can imagine that we “demand’ more than “desire,” the more we might prove able to avoid existential questions and concerns, and the more we might be able to avoid asking ourselves why we desire what we desire, and so on (a natural tendency which benefits Discourse over Rhetoric). But this may have contributed to us avoiding what Keynes could have shown us, which is the primacy of something which is ultimately mysterious, irreducible to modeling, and fundamentally “(meta)physical.” As a result, our economic theorizing has arguably proven lacking, and we have not thought “internal coordination.” But doing that might make us face ourselves, and as long as we can just talk of “demand” and imagine it has infrastructure with a few luxuries here and there, we can avoid owning desire. Existential dread can be abated. But we must be “released” from the “given” of demand, especially if there is something about First World Nations which cause demand and hence desire to fade and dwindle — a problem that might be thought of as one of our “main problems,” a problem expounded on by Tyler Cowen in The Great Stagnation, a problem Keynes himself also understood.
To review, in my view, Keynes was right about DEH but overly-optimistic about the State’s ability to create demand (which would require the State to maintain Rhetoric without it devolving into Discourse), especially today, after “the low hanging fruit” of basic infrastructure has been picked, and we’ve moved from an economy that wrestles not just with “scarcity” but psychoanalytical “lack” (a transition which seems to map onto the movement from a Third World Nation to a First World Nation). Again, this isn’t to say the State can do nothing, but it is to say that the State can likely do less with time and as technology advances and becomes more complex (which is to say as it becomes more difficult for the general public to understand given State spending as “valuable investment”).
For more on the need to focus on “lack” in economic theory:
What constitutes a “value add” seems to become more particular and specialized with time (though that’s not to say “general needs” can’t emerge, say if one day we need to escape to Mars due to an environmental disaster), and that being the case the State likely won’t have the “particular knowledge” needed to tell what investments “add value” and for whom (a Hayekian critique). Through time, as what constitutes a “value add technology” moves out of the realm of “general knowledge” to the realm of “particular knowledge,” there must be a transition from “FDR economics” to greater and greater reliance on the Artifex, “creatives,” and “internal coordination” in general. We cannot live off “low-hanging fruit” forever, and perhaps in the past a “small Artifex” or “small creator class” was enough for us to reach that fruit. But now we must look to the higher branches, and climbing that high will require more ideas and more Artifexians of us to figure out. Furthermore, we will have to stop conflating “stimulating external coordination on the price side” with “creating internal coordination on the value side,” as Anthony stresses and argues so well.
As the bar rises on the complexity and specialization that must be mastered to reach “new technologies,” so too must rise the size of the Artifex or “Children class” to meet the challenge. The Artifex must grow with time. This in mind, if Hegel is correct that “the stakes raise” as history advances (a point elaborated on in “Absolute Knowing” by O.G. Rose), then perhaps the “continual progress” of history is primarily contingent on the growth of the Artifex, Rhetoric, and/or Children? Hard to say, but, all the same, FDR must transition into “Artifex incubation,” per se, which is to say the State must somehow incubate “the spread of Childhood.” But how without that becoming oppressive? Indeed, how.
Alright, fine, but why are we so sure that we need to worry about “internal coordination?” Sure, the case has been made that we don’t know what constitutes demand and currently only “practically know” it (making us fragile), but perhaps the reason wealth seems to correlate with falling demand is because wealth generates more Discourse and less freedom, and if we simply had more freedom, Discourse would dwindle, Rhetoric increase, and wealth-creation recommence. This is the view that “freedom self-organizes,” and that what we need is simply to create more freedom and things will mostly take care of themselves (or else that’s the best we can hope for). I associate this view with Libertarianism, a field of thinking which I think we must take seriously. Furthermore, if “spreading Childhood” is impossible without being oppressive, then Libertarianism might be the best we can hope for, mainly a hope in “the self-organization and self-correction of freedom” (or else a view like Nietzsche’s, which McKerracher critiques in Timenergy). Personally, it can sometimes seem difficult to tell the difference between “Libertarianism” and “Conservatism,” but to generally describe the difference:
Libertarian
Freedom self-organizes and wealth-creates.
More Monistic
Conservative
Freedom requires culture to self-organize and wealth-create.
More Dialectical
Some Libertarians might not agree with my description here and claim they emphasize culture just as much as any Conservative, and furthermore many people who call themselves “Conservative” seem to actually be more Libertarian and emphasize “freeing markets.” Language is tricky, and I don’t mean to suggest what I wrote as some “authoritative definition,” but I also would like to language the possible difference so we can better explore the possibility of “freedom as self-correct and self-organizing,” which if the case, we need only increase freedom so that Rhetoric might emerge over Discourse. To consider this possibility, we will close our consideration of “demand” and turn to David McKerracher and Adam Smith…
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