At 11:10 PM 3/6/2008, Medema, Steven wrote:
>[Posted on behalf of Warren Samuels.]
>What is in effect common to both of
>them is the need for a strategically placed "class" who needs, or says
>they need, a larger slice of the pie, through, e.g., a tax cut for some
>and not for others.  In this country this class has been the owners and
>controllers of firms (after Berle and Means)--"private" capitalists; in
>the former Soviet Union, the class was comprised of state capitalists.
>The irony of part of this, and of the rhetoric of elections here, is
>that our history, e.g., in Massachusetts Bay Colony, commenced in a
>conflict between religious fundamentalists and traders, and that since
>then, with variations in the "family values" and the domains of the
>powerful, the conflict has continued.

We can take this even further back in history, 
because I cannot help reflecting that this is 
exactly what Aristotle says. For Aristotle, any 
divisions of rewards from a common fund, such as 
the body politic or a firm, will be based on the 
contributions of each member to the firm or the 
fund and to the "merit" associated with each 
contribution. However, "merit" is determined not 
"economically" but culturally, ?for democrats 
identify it with the status of freeman, 
supporters of oligarchy with wealth (or with 
noble birth), and supporters of aristocracy with 
excellence.? Since it is cultural, these 
evaluations are subject to change; the labor of 
CEOs, for example, is valued today at a much 
different level than what it was even a generation or two ago.

Aristotle discusses this under the rubric of 
distributive justice, a topic which more or less 
disappears from marginalist economics, since such 
economics conceives of everything is terms of a 
series of exchanges (with man and nature 
commodified as labor and real estate), and thus 
falling under the rubric of commutative or 
correcti ve justice; there is no room left for 
cultural questions or questions of distributive 
justice. However, there are legitimate grounds 
for calling that description into question. This 
question, it seems to me, must be answered prior 
to accepting Pat Gunning's description of the market.

And by the way, I don't think Aristotle gets all 
the credit he deserves as an economist, and many 
of the categories he developed have been rejected 
outright, such as the distinction between natural 
and unnatural exchange. However, what strikes me 
is that this distinction fits the sub-prime 
crises to a T, and even provides some tools by 
which to understand and analyze it. Most students 
of economics believe it is a science that dates 
back to the 18th century, and history books have, 
at most, a chapter or two on any prior period. In 
doing so, we may have stunted our understanding to the subject.


John C. M?daille