Fred Foldvary wrote:  
>This overlooks the producer surplus, which is mostly  
>land rent, and indeed (as Ricardo wrote) does not  
>enter into the cost of production, hence is a social  
>surplus. The ethics of equity has to confront who  
>should receive this surplus.  And this has nothing to  
>do with equilibrium, as the surplus exists also in  
>disequlibrium and in economic dynamics.  
  
I agree with this, but Clark would not, and it   
was Clark's thesis that I was explicating, not my   
own. And for Clark, equity is the result of   
equilibrium. On my own view, equilibrium is more   
likely to be the result of equity.  
  
  
>But of course if a supply curve slopes up, there is a  
>"producer surplus" which (as Marshall recognized) is  
>really mostly land rent, and since land is not a  
>produced good, the suruplus is really a "non-producer"  
>surplus.  
  
Again, I mostly agree (although I don't think   
that all economic rents are ground rents), but   
this is not Clark's view, and certainly not the   
NCE view in general. Clark thought he could get   
rid of Marshall's problem by turning capital into   
a mysterious fund, a platonic entity that floated   
above its actual material content, a content that   
happened to include land. He performed the same   
courtesy for labor and hence de-natured both land   
and labor. In doing so, he turned land and labor   
into fictitious commodities (Polanyi's term) and   
hence no longer had to deal with their actual   
existence; in other words, he defined George's   
and Marshall's problem out of existence. The most   
current practical explication of this thesis, by   
the way, is in Hernando de Soto's "The Mystery of Capital."  
  
  
  
  
>No, but we should recognize that besides cultural  
>values there is a rational universal ethic (or natural  
>moral law) that can be derived using reason.  As John  
>Locke wrote in the Second Treatise:  
>  
>"The state of Nature has a law of Nature to govern it,  
>which obliges every one, and reason, which is that  
>law, teaches all mankind who will but consult it, that  
>being all equal and independent, no one ought to harm  
>another in his life, health, liberty or possessions."  
  
I agree that there should be and likely is a   
"universal ethic." Indeed, Clark was certain that   
he had discovered it, and published in purely   
religious journals the claim that he had worked   
out  the natural laws of the moral and economic   
orders. The problem is, however, that the   
"universal" for humans is only reached through   
the cultural expressions of it; man has no other   
way of being than being cultural, being enmeshed   
in particular language and social systems.   
Ethical claims can never, and likely shouldn't,   
escape a certain amount of cultural   
particularity. Therefore, the claim to have   
reached the "universal" always has to be greeted   
with a certain skepticism. No ethical system can   
be logically validated because ethics do not   
belong to the realm of speculative reason, but to   
the practical reason. Thus Locke's system (like   
Aristotle's, Aquinas's, Mandeville's, Clark's or   
Mises's) is merely a rival claimaint to   
universality. And there is an inherent problem   
with a universality that has so many rival   
versions. The question then is how you compare   
these rival claims to arrive at a reasonable   
judgement. Ethical propositions can never be   
demonstrated in the same way that mathematical   
ones are but are compared through an entirely   
different methodology. And I believe that since   
ethics belong to the practical reason, economics   
plays a key role in the comparison of ethical   
systems, but not the role that it has generally   
played, which is mainly one of being in itself one more rival claimant.  
  
  
John C. Medaille