Utopia for Realists by Rutger Bregman (Part 1)

How We can Build The Ideal World

‘A map of the world that does not include Utopia is not worth even glancing at, for it leaves out the one country at which Humanity is always landing. And when Humanity lands there, it looks out, and, seeing a better country, sets sail. Progress is the realization of Utopias.’ Oscar Wilde

The Return of Utopia. In the past, the world was much worse than what it was today. Poverty rates have fallen and life expectancy has increased. The last 2 centuries have seen explosive growth, like nothing mankind has ever experienced. People are 250 times richer as compared to the Industrial Revolution. People used to dream of a brighter future. Modern world suffers from problems like obesity, pollution etc. Modern medicine has allowed those who have suffered to live again. Driverless cars are on our roads. Internet access and smartphones are getting more widespread. Vaccines are useful to prevent diseases and pre-mature death. In terms of literacy, humans are at our all-time high. Although everything seems good, we may lack a purpose in life. We live in a capitalist and consumer driven society. How can we improve our current state? A common utopia is one of blueprints, where dissension is not tolerated. Transgressions are not allowed and will be punished. Why are we working long hours than before even though we are richer now. To many, utopias turn out into dystopias and nightmares. We crave freedom, but it some ways, it is an empty freedom. We spend too much on health care. The advertisers and mass media benefit from over consumption. This is the dystopia we are living in. We are pampered too much. We believed in big dreams in the past but we know that reality is very different. We are becoming more anxious over time. We are becoming more and more alike. There are other ways to progress other than via capitalism. Our utopia will start small and grow from there. Even though things are well, we need to constantly improve.

And the ad industry encourages us to spend money we don’t have on junk we don’t need in order to impress people we can’t stand. – Rutger Bregman

If success is a choice, then so is failure. Lost your job? You should have worked harder. Sick? You must not be leading a healthy lifestyle. Unhappy? Take a pill. – Rutger Bregman

Why We Should Give Free Money to Everyone. Feeding the homeless might be cheaper than locking them in jail or providing social services. One other way is to give them money. This is ironic, but it might work. How they spend it is up to them. The fact is that most of them were actually prudent in their spending. Some even used the money for personal growth. Giving money to them might be the most efficient way to help them. Free money doesn’t make people lazy. This has been proved by different studies. This has been proved in Namibia and Malawi. This might be superior to spending money on food etc. You have the freedom to buy want you need. This was already mentioned in Thomas More in his book in 1516. The dream is for all to have a universal basic income for everyone. Canada experimented with this idea in the 1970s. Mincome, a city in Canada, worked well under this model. There is a fear that people would be lazy if they didn’t work. There is little evidence that people would be lazy if they had a basic sum of money each month. President Nixon pushed for it in the past, but it often got rejected by the Senate. Many years back, democracy seemed a utopia, but it has worked. The benefit of giving people a basic income is that the poor can take on jobs which can give them growth. This should be the aim of capitalism.

Poverty is fundamentally about a lack of cash. It’s not about stupidity. You can’t pull yourself up by your bootstraps if you have no boots. – Joseph Hanlon

There is overwhelming evidence to suggest that the vast majority of people actually want to work, whether they need to or not. In fact, not having a job makes us deeply unhappy. – Rutger Bregman

So we have inspectors of inspectors and people making instruments for inspectors to inspect inspectors. The true business of people should be to go back to school and think about whatever it was they were thinking about before somebody came along and told them they had to earn a living. – Richard Buckminster Fuller

The End of Poverty. A new casino opened in 1997. It was Harrah’s Cherokee. It was run by Cherokee Indians. Organized crime did not increase. Those kids who grew up in poverty tended to have behavioral problems. Which was the cause, and which was the effect? Costello’s subjects who were lifted out of poverty had much lesser behavioral problems. Money from the casino earnings were given to needy families. The tribe ended up thriving after the casino earnings. Genes can’t be undone. Poverty can. Why do the poor tend to make dumb decisions? Poverty is something the individual has to overcome on their own. In economics, always everything revolves around scarcity. Poor people find food scarce, so they need to find an incredible way to make ends meet and that is a good thing. You can’t take a break from poverty. It’s all about the context. You can’t take a break from poverty, unlike a situation where you are busy at work. We all need to increase our gross domestic mental bandwidth. Getting out of poverty is more important than education. One solution is to give needy students a hand with financial aid paperwork. Does money enable you to be happy and healthy? Inequality is a big issue in modern society. Relative poverty is very important because like to compare themselves with others. Social mobility goes up when inequality goes up. Even rich people might not feel good if the inequality in their country is too high. Providing free apartments are also useful, as it helps to get homeless people off the streets. Homelessness can certainly be solved. We need to address the root cause, not the symptom.

Scarcity consumes you. You’re less able to focus on other things that are also important to you. – Eldar Shafir

The effect of poverty lowers your IQ by around 13 or 14 points. That’s comparable to losing a night’s sleep or the long term effects of alcohol. – Eldar Shafir

If you’d like to have more money, time, friends, or food, you’re more likely to experience a sense of scarcity. And the things you want are determined to a large extent by what people around you have. – Rutger Bregman

Poverty is a great enemy to human happiness; it certainly destroys liberty, and it makes some virtues impracticable, and others extremely difficult. – Samuel Johnson

The Bizarre Tale of President Nixon and His Basic Income Bill. Historians have more to give us. We should look and learn from history as much as possible. We shall look at Richard Nixon. He was forced to resign after the Watergate scandal in 1974. There were many who opposed his plan of giving free money to everyone. Anderson managed to change Nixon’s mind. The Speenhamland system failed badly in the 19th century England. Why did the President switch his mind? However, his message of wanting to fight laziness among the poor caused people to turn against the idea of basic income. Speenhamland appeared to be successful initially. In the fact, people were convinced that population growth will exceed food production. However, it was a disaster because of a few reasons. Marx believed that a revolution was needed to bring people out of poverty, not a basic income. Modern historians have realized that the results from Speenhamland might not be reliably measured. The consensus that the poor were becoming more lazy might be untrue. The Royal Commission Report changed Nixon’s decision. The truth of population growth indefinitely might not hold true. In 1834, the Speenhamland system was dismantled. The idea of a self-regulating market that will liberate the poor was still a dream. There are some scholars who believe that Speenhamland was a success. Things could have been handled so much better. The idea of a welfare state was hit badly as a result of Speenhamland. People who are poor only thing about the here and now and not the future.

The gross national product…measures everything…except that which makes life worthwhile. – Robert F. Kennedy

New Figures for a New Era. The Japan earthquake on Mar 11, 2011 wrecked havoc on the Japanese economy. However, the economy recovered miraculously fast. It had a silver lining for GDP. Rebuilding has a huge impetus for the government. However, we shouldn’t welcome these disasters. GDP does not measure the intangible benefits to society. It does not measure things like community service, clean air etc. Also, things like domestic workers are not measured in the GDP. Denmark has tried to quantify the value of breastfeeding in its GDP. GDP does not measure advances in technology. The higher the social problems, the more it will contribute to GDP. In the past, banks took up a huge slice of GDP due to their risk taking culture. Are we placing too much emphasis on GDP? Almost all politicians believe that growth is good for employment and the economy. The idea of GDP was already mooted in the 1800s. Adam Smith believed that those who worked in services industry produced nothing at all. Alfred Marshall realized that it was not so much the nature of products that mattered, but the price. However, accurate calculations on GDP only existed in the 1900s. It was essentially invented by a Russian professor named Simon Kuznets in 1932. It would be an excellent yardstick for any country. The GDP could give an overall picture of the economy. Even today, many professors do not understand how GDP works. GDP measures all the activity within its borders (including by foreign enterprises). GDP was very useful after a war. There are many other useful statistics that can serve us better than GDP. Today, the economy is so much more complicated than just some production numbers. In Bhutan, a gross national happiness index was suggested. Two possible candidates might be the Genuine Progress Indicator (GPI) or the Index of Sustainable Economic Welfare (ISEW). The wealthier a country is, the more difficult it is to measure that wealth. In Europe, the governments subsidize domains where productivity can’t be leveraged. The cost of health care is bound to increase. We will need indications to track life, eg. Community service, social cohesion, jobs, knowledge etc. We need to rethink how we relook at growth?

Productivity is for robots. Humans excel at wasting time, experimenting, playing, creating, and exploring. – Kevin Kelly

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How to Worry less about Money by John Armstrong

There is a distinction between money worries and troubles. Worries are connected with imagination. Troubles are when you have difficulty paying your bill. Most advice for money problems is to find ways to increase one’s wealth. The more important to ask is ‘How much money do I need’. What will you be buying with that money? ‘What’s the link between money and the good life?’ Similarly, there is a difference between training and education. The way we have taught about money matters is more of a training than an education per se. Karl Marx didn’t believe money did any good on society. There are also schools of thought where money is viewed neutrally. Ask yourself, what is the role of money in your life? What is your equivalent theory of money?

Thinking about Money

What are money worries really about? My life will have a lot of pains and hassles? ‘Money will force me to spend a lot of time just making enough to get by’. ‘I’ll miss the good things that I long for.’ ‘Money is like a virus’. The important questions to ask are ‘What is the best way for me to get that money?’; ‘What are my economic responsibilities to other people?’ There are definitely underlying causes to one’s worries that must be addressed. Sometimes, people worry about things when they compare what they own with others around them. They don’t want to be judged by others. One should think hard before buying a new car. People worry once they compare themselves to admirable people. If your objectives and worries are vague, all the more you need to pay attention to them.

A Good Relationship with Money. Money brings a certain level of spending power. Instead of addressing the quantity of money, it is better to address your relationship with it and the feelings you have. Some form of angst is inevitable. The aim of adult life is to worry well.

You might grow up (as I did) in a grim environment and long to make enough money to escape it. But that can feel like losing your roots. Or, in order to make enough money to survive in a competitive world, you might feel you have to sell out and never devote yourself to the things that you wish you could focus on, like family, creativity, changing the world or simply cultivating your garden. – John Armstrong

Part III: The Secret Meaning of Money. Emotional baggage can cause problems. Some people feel that money means an enviable time together. A money solution is unlikely to solve a romantic problem. Money may not ease relationship tensions. Some people feel that they always want more and that what they have is never enough. Sometimes, it is important to confront your insecurities. Some people just want to earn and spend more than others so that they can feel better about themselves. Others may not want so much money as their money management skills are poor and the money often gets squandered away. People often view others’ self-worth based on their wealth. This is creepy indeed and should not be the case in society. Wealth can create social classes and strata. Sometimes, money can be seen as a form of goodness. Money should just be a neutral mechanism for exchange. Money can cause us to behave in strange ways. We need to improve our relationship with money as a whole.

How to Strip Off. Acknowledge that you treat money in strange ways. Associate some words with money. Do you associate hassles with a lack of money? Do you associate a lack of money with ‘I’ll never escape’? Your troubles will not simply go away with more money. Do not feel happy when others are unhappy. What’s your most embarrassing moment with money? What are your worst fears about money? Ask yourself these deep questions. Stripping away basically means clarifying one’s own relationship with money. How do we find people also interested in this conversation? You should try to look out for the following people. 1) People who encourage us to be realistic. Setting too high expectations might make you disappointed. 2) People who don’t use money as a way of humiliating others. Avoid these people at all costs. 3) People who don’t spread despair and resentment about money. 4) People who encourage good habits. 5) People who are open about their own economic experiences. 6) People who listen – and don’t project their situation onto yours. Do not use others’ lives as a model for your own. 7) People who open our minds to thinking more clearly about our situation, opportunities and difficulties.

What is Money? It is essentially a means of exchange. Barter trade happened because of this. Money can buy you possessions and experiences. How efficient do you use your money to turn it into possessions and experiences? How do you turn work into money? The problem is some people see education as earning potential or a painting as just a price tag. Do not view every possession just as money or the ability for it to make you more money. View your house as a home rather than an economic vehicle.

Another common fear is that even when there is enough money, one is not actually able to translate it into good enough possessions and experiences. Money on its own does not show you how to do that. – John Armstrong

The task of life is to translate efforts and activities that are inherently worthwhile into possessions and experiences that are themselves of lasting and true value. – John Armstrong

Money and the Good Life

Money as an Ingredient. Money is an instrument. It should be used efficiently and effectively. Understand the diminishing return in terms of happiness when you accumulate more money. Even you lead a glamorous lifestyle, it is possible to be depressed. Money cannot buy happiness. We should talk about flourishing and not happiness. Most people like to do things with others. Flourishing means doing things that are important to you, even if they might be unpleasant. It also means making the best use of our capacities and abilities. Be involved in things that are worthwhile. Money creates potential for flourishing. However, money is not the sole cause of flourishing. It is simply an ingredient. The important question is ‘How much do I need?’ What are your real objectives? What does money contribute?

Money can indeed buy things that make you feel serene: the plush hotel etc. But there are many possible sources of serenity, such as a good temperament, stable relationships, taking physical exercise, possessing a religious belief, listening to music etc. – John Armstrong

A good life is still a life. It must involve its full share of suffering, loneliness, disappointment and coming to terms with one’s own mortality and the deaths of those one loves. – John Armstrong

Jane Austen’s Theory of Marriage. Is money connected to love and sex? Love benefits from a healthy economic conditions. There are other foundations required for a good relationship. If you have a good salary, but have an extravagant lifestyle, you are unlikely to be rich. The important lesson to learn is that money is necessary, but not sufficient. It is important to marry someone of decent financial background. It is a crucial ingredient in marriage. Money worries can cause conflicts in a relationship.

Envy as Education. What if you have a dream but your current income level is far from achieving it? Take it seriously. Learn to be creative. Do not simply copy others. Think about the elements of your dream that can be incorporated in your life now even though you have less money. Try to reproduce the underlying virtues. Often, you don’t need radical changes in your life to feel happy.

When a person dies, we know we have to take the sorrow seriously. We don’t pretend that the person didn’t die or that it doesn’t matter. In a less intense but still important matter, we should mourn the loss of other things we love. – John Armstrong

Creating Order

Need vs Want. How important is that object in your life? What can it do for you? A violinist NEEDS a really expensive bow. This is because the bow has played a central role in that person’s life. Hence, meeting a need can be out of reach. However, it is a worthy pursuit as compared to a want. Some purchases will not help you to develop or flourish. How do you differentiate need from desire? How good will it be for this thing to enter my life? Do not simply tell yourself that if you can’t afford it, it doesn’t matter whether you have it or not. The trick is to work out your needs without taking into account the price of the items. There are higher needs that might enable you to flourish as an individual. Distinguish between middle and higher needs. Middle-order needs relate more to sociability and status. There is an indirect costs of higher needs. Do not do things just to gain status. Higher needs are not simply about craving for status. It is okay to envy someone, however, we must know exactly what aspects of the person we envy. We need to find the right type of company.

How Much Money Do I need? Instead of being realistic about what you can afford, be realistic about what you need. Write them down a table. This is a sober reality check. Then after it’s written down, ask yourself what can be done in order to get closer to meeting your true needs. You can live in a bigger house if you move to the suburbs. Is a holiday more important than presents? What things are good for my long-term well-being?

Price vs Value. Value is a personal judgement and it depends on your character, perspectives etc. Some people are resourceful, but that doesn’t make them stingy. Some of them have good taste and don’t follow fashion. Learn to be creative. Spending money is an art, not a science. Learn to pay attention to the hints around you to draw inspiration from. You can be creative.

Longing and Fear. Keep your house neat. Do not clutter. The fear has to be overcome. To me, the thought of organizing my money drawing makes me fearful. The solution is about money. I feel bad about my relationship with money. Labour can be dignifying if it leads to a grander aspect of existence. Spread the difficult task over a few days. Cultivate the art of tracking your domestic finance. There is indeed a beauty to neatness and clarity. When confronting a difficult task, it is best to do it in stages. There is beauty in going about our ordinary lives.

How to Make Money and be a good person at the same time

Having and Doing. Money is like a ‘virus’. For a child, he thinks that the more fun an activity is, the more good things flow from it. However, this doesn’t often happen in reality. Some children believe that money equals happiness. A lot of people want to make enough money and care about what they are doing too. We need to care about both having and doing simultaneously. If you want to maximize intrinsic good for society and through the course of it, you make a lot of money, that’s alright. It is very difficult to escape capitalism because it is so prevalent in society. However, we can be more hopeful over it. Is it so difficult to be a good person and to flourish financially?

What Rex Got Wrong and Other lessons. Is it possible to make money and meet the higher needs of humanity? Learn to pay attention to the cause of profits. Sometimes by commercializing something, you cheapen and degrade it. Commodification is a bad thing? Create an economic base. Standardization causes something to lack a soul. Industrialization has its benefits. We need to understand the ends, so that we will know what means to take. Constantly ask what is the good that is being served? Society needs to answer the question of what good does art serve. Money can be made in so many ways. It is important to ask how they made it.

My Place in the Big Picture

The Problems of the Rich. The desire for wealth is almost universal. However, the rich have their problems as well. Wealth from inheritance is pure lucky and it is through no effort on your own. If you receive it, you should not feel any superstitious sense of entitlement etc. Even wealthy people become envious over others. Having money might not free you completely. Rich people often feel like they can do whatever they want. Rich people have to fight off temptations as alcohol is detrimental to health etc. They feel they have the power to destroy others if they wanted to. Rich people don’t usually rise up to philanthropic examples of people in the past.

The Virtues of Poverty. Is there anything we can learn about it? This means indifference to possessions. Voluntary poverty might be good. Some people see possessions as corrupting. Being poor frees you from being preoccupied with getting and spending. Inner security is the key here.

The Intimate Relationship with Money. Money worries are vastly different from money troubles. We need to be more attentive to our experiences with money. Worrying less helps. Ask what does money mean to you.

How to Worry Less About Money_4

 

 

 

The Economics Book (DK) (Part 2)

Protestantism has Made Us Rich (Religion and the Economy). Recent research has reflected that Protestantism has no effect on economic growth. Protestants believe in hard work and frugality as they believe it will lead to salvation. The money earned will be reinvested in the future and grow the economy. Religion might make a difference to the wealth of nations.

The Poor are Unlucky, Not Bad (The Poverty Problem). A lot of things are out of one’s control. Such as property prices, education costs, job prospects etc. Therefore, the poor are just unlucky. The question is whether the poor should be given handouts. John Stuart Mill believed the State should intervene and help those truly in need. Amartya Sen believed that ‘poverty is about limitations in capabilities and functioning’ Extreme poverty is defined as earning less than $2 a day.

Socialism is the Abolition of Rational Economy (Central Planning). Marx believed in socialism. This means state ownership of production and limiting competition. This involved heavy central planning. Without competition, there is little information or incentive for efficient production. Therefore, this is in direct conflict with capitalism. The state decides on the prices of things. However, it is very difficult to determine this. Money is less important in Socialism. However, if you derive values of products from their labor costs. It is not the true market price. Central planning committee has to decide what goods people want so that the factories can produce them. Some argue that only the free market can provide the right incentives and information. The Socialist system in Russia collapsed.

In the socialist commonwealth, every economic change becomes an undertaking whose success can be neither appraised in advance nor later retrospectively determined. There is only groping in the dark. – Ludwig von Mises

Capitalism Destroys the Old and Creates The New (Creative Destruction). People seek new markets and new profits through innovation. This will lead to certain emerging industries and certain sunset industries. This concept was coined by Joseph Schumpeter. Entrepreneurs are the big driver of this. There are two types of technological innovations ‘Sustaining’ and ‘Disruptive’.

New products and new methods compete with the old, not on equal terms but at a decisive advantage that may mean death to the latter. – Joseph Schumpeter

War and Depressions (1929 to 1945). Economics is the ‘science of scarce resources’. After a crisis, an economic stimulus is needed. Keynes believed in government spending to get out of a recession. By controlling money supply and public spending, it was possible to kick start the economy. Economics had two branches, microeconomics and macroeconomics. After Keynes in the 1930s, people began to fall back on the free market.

Unemployment is not a Choice (Depressions and Unemployment). People used to think unemployment was a choice as people had too high wage expectations. As prices fall, value of wages rise, therefore, there is a need to retrench people. People are thus trapped in unemployment and firms are under producing. In 1936, Keynes published his most important work. In modern times, unemployment remains a problem. Unemployment is not just a problem with individuals. It is a problem with the economy. This is known as ‘involuntary unemployment’. Even a free market will not return the market to equilibrium easily. One way to solve unemployment is to force people to take a pay cut. However, not many in reality will accept this. This is not a realistic solution. He believed in fiscal stimulus and it doesn’t matter how. The ISLM model is very popular nowadays. Many people don’t want their wage to fall as they are constantly comparing themselves with their peers.

The sooner involuntary unemployment is disposed with, the better. – Robert Lucas

The treasury could fill old bottles with banknotes and bury them…and leave it to private enterprises on well-tried principles of laissez-faire to dig the notes up again. – John Maynard Keynes

The difficulty lies not in the new ideas but in escaping from the old ones. – John Maynard Keynes

Some People Love Risk, Other Avoid It (Risk and Uncertainty). People don’t just make decisions on probability. Risk averse people tend to have lower returns and risk seeking people tend to have higher returns. In order to attract people to take on risk, you need to provide higher returns. Risk is different from uncertainty. Uncertainty is when you don’t know the outcomes.

Profit arises out of the inherent, absolute unpredictability of things. – Frank Knight

Government Spending Boosts the Economy by More than What is Spent (The Keynesian Multiplier). Government Spending will create employment. The workers will then spend more, creating even more employment. Keynes was a strong advocate of government spending. A standard estimate is that every $1 of government spending might create an increase in income of $1.40 through these secondary effects. ISLM (Investment, Savings, the demand for Liquidity, and the Money Supply).

Besides the primary employment created by the initial public works expenditures, there would be additional indirect employment. – Don Patinkin

Economies are Embedded in Culture (Economics and Tradition). It is a common belief that people are rational. However, Karl Polanyi countered this why saying is that culture drives economic life. People desire status in society and therefore work hard in getting there. An example of his theory in action is in the Trobriand Island tribe. He didn’t believe that markets and social structures could exist harmoniously.

The economic system is, in effect, a mere function of social organization. – Karl Polanyi

Managers go for Perks, Not Their Firm’s Profits (Corporate Governance). Not all companies are run in the best interests of their shareholders. Nowadays, management have a huge say in how a company is run. Also, the problem stems from passive shareholders. Berle and Gardiner founded the modern corporate governance. This is to ensure that management acts in the interest of shareholders. However, in the 2008 financial crisis, corporate governance failed.

The Economy is a Predictable Machine (Testing Economic Theories). Econometrics is the testing of economic variables through mathematical means. However, past performance is no guarantee for future performance. There are many variables to consider.

Intermediate between mathematics, statistics, and economics we find a new discipline which…may be called econometrics. – Ragnar Frisch

Economics is the Science of Scarce Resources (Definitions of Economics). Scarcity forces economic choices. ‘Science of human actions in the face of limited resources with multiple uses.’ ‘Human needs are infinite, yet there are only a finite amount of resources.’ This definition has been wider accepted.

We Wish to Preserve a Free Society (Economic Liberalism). Prices should reflect total market information and governments should aim to protect that. Friedrich Hayek was a very influential economist. He didn’t governments had the ability to shape society. He was right when those states with planned economies would head to a totalitarian state. Some economists defended Socialism. Hayek argued that all individuals were very sure of what they were doing and market had imperfections. He believed in the free market. The government should intervene only to restore the market to its free market state. Therefore, the state should only have a limited role.

The more the state ‘plans’, the more difficult planning becomes for the individual. – Friedrich Hayek

Industrialization Creates Sustained Growth (The Emergence of Modern Economies). More people work in cities, obtaining a higher level of skill and education. This leads to cultural change and business growth. Future generations will also enjoy this. Simon Kuznets created this idea. He saw that factories will take over farms one day. Industrial Revolution helped Britain in the 18th Century. In modern society, there is now a move to the service sector.

Different Prices to Different People (Price Discrimination). Price discrimination is possible even in markets with only a few firms. Firms want to charge according to how much each customer is willing to pay. There are generally three types of pricing models. The first to charge each customer the maximum he/she is willing to pay. The second is to reduce the price for each additional unit sold. The last is to identify different customer groups and charge each group accordingly. This might allow people like students to benefit as they can now afford to watch a movie.

Price discrimination is the act of selling the same article produced under single control at a different prices to the different buyers. – Joan Robinson

Post War Economics (1945 to 1970). It was a difficult time for economies to rebuild. The UN was formed in 1945. Keynes was lauded for his emphasis on fiscal policy when there is an economic crisis. However, Asia and Russia did not fair so well. The impossibility theorem shows that there is no perfect voting system. Perhaps a country’s growth can be measured by other factors.

In the Wake of War and Depression, Nations Must Cooperate (International Trade and Bretton Woods). Gold initially backed paper money. After the Great Depression, many tried to devalue their currency, making exports more attractive. Restrictions on trade only help to prolong the Depression. In 1944, delegates agreed to peg currency against USD. This was governed by the IMF, where they could distribute emergency funds. In 1971, President Nixon suspended the dollar-gold link (Bretton Woods system). There is a need for nations to cooperate and open trading doors to others in times of crisis.

All Poor Countries Need Is a Big Push (Development Economics). Poor countries require investments in infrastructure and industry simultaneously. Only governments can afford to do this, not corporations. Poor countries need a big push. Massive capital injections are necessary. Infrastructure and Factories are 1 set. You need both for the economy to start going. Many industries are linked to another. When one does well, the other might or might not do well also. Thus, it is possible to go from nothing to everything. It is hard for private enterprises to drive this. Governments need good knowledge of the forward/backward industries. A good state should not allow too much government intervention. The UN offers aid to developing countries.

Most industries catering for mass consumption are complementary in the sense that they provide a market for, and thus support, each other. – Ragnar Nurkse

People are influenced by Irrelevant Alternatives (Irrational Decision-Making). In theory, people make decisions based on probability. However, research has proven that people switch irrationally to other products. Maurice Allais didn’t believe people sought the greatest utility as this is based on assumption and choices are often co-related. ‘The violation of independence takes place in situations of uncertainty.’ People often violate the independence axiom. People generally like alternatives.

Governments Should Do Nothing but Control the Money Supply (Monetarist Policy). Keynes didn’t believe in controlling the money supply. However, Milton Friedman believed that controlling the money supply will work. Money will affect output in the short run and prices in the long run. The failure for people to spend in a recession prolongs it. The problem of state intervention to reduce unemployment led to high inflation. He claims that fiscal stimulus causes inflation and should be avoided. ‘Money should grow at a modest, constant rate in order to keep inflation low.’ He believed in the short run that output will increase in the short run and in the long run prices will increase. Inflation and unemployment is governed along the Philips Curve. There is such a trade-off. However, there is a natural rate of unemployment. Some argue that people e predict government’s plans and therefore in the short run, the Philips Curve is vertical. It is possible for both unemployment and inflation to increase together. This is known as stagflation. Nowadays, monetary supply is controlled, as is fiscal policy. In the 1990s, countries used exchange rate or change interest rates to impact inflation.

The More People in Work, The Higher their Bills (Inflation and Unemployment). There was research that reflected periods of high inflation coincided with low unemployment. Governments could pick their point on the Philips Curve. However, in the 1970s, both unemployment and inflation moved together. The Philips Curve did not take into account people’s expectations of inflation. According to him, there is no trade off. There is only a natural rate of unemployment in every economy.

People Smooth Consumption Over their Life Spans (Saving to Spend). People save money and take into account their lifetime income when spending. When government spending increases, people’s spending increases by a multiplier of that. However, in reality, ‘the ratio between household consumption and income over the long run turned out to be stable.’ Individuals anticipated how much people they needed in the future and started to save. People save when they are young, spend when they are old. This is the life-cycle hypothesis.

‘Permanent income hypothesis’. ‘Successive generations seem to be less and less thrifty. – Franco Modigliani

Institutions Matter (Institutions in Economics). Some economists investigate the role of institutions in the State. They are important as they set the laws, customs and traditions of a society. People tend to follow them. Tension is rooted in colonial origins. When institutions degenerate, problems start for the economy.

People Will Shirk If They Can (Market Information and Incentives). Banking bailouts are moral hazards. When no one is watching, people put in less effort. This is because actions are hidden from the other party. This is known as ‘moral hazard’. Principal can’t monitor the agent all the time. Wording the contract in a certain way might prevent this from happening. Banks who think they are too big to fail might keep thinking that the government will bail them out. This causes them to take on excessive risk.

Theories about Market Efficiency Require Many Assumptions (Markets and Social Outcomes). Market efficiency requires assumptions that price completely reflect customer preferences etc. Walras believed that markets, without intervention, can reach a stable equilibrium. Only under certain conditions could a set of markets remain in equilibrium. The first welfare theorem states that ‘any pure free-market economy in equilibrium is necessary ‘Pareto efficient’. The second welfare theorem states that ‘any of these Pareto- efficient distributions can be achieved using free markets.’ Using a Contract Curve. For the theories to hold, people need to rational and respond to market signals. There cannot be externalities or economics of scale.

An allocation of resources could be efficient in a Pareto sense and yet yield enormous riches to some and dire poverty to others. – Kenneth Arrow

There is no Perfect Voting System (Social Choice Theory). To evaluate the well-being of a society, values of individual members need to be taken into account. There must exist a system for them to state their preferences. ‘It is impossible to devise a voting system that truly reflects the preferences of an electorate’. Some prefer A to B, and B to C, but also C to A. With an ideal voting system, it is not possible to satisfy all the assumptions, one being that there should be no dictator. Arrow’s theorem is now being widely applied in society.

The Aim is to Maximize Happiness, Not Income (The Economics of Happiness). Joblessness is a main course of unhappiness. In the 1930s, GDP calculations came about. Rising GDP meant increasing wages and jobs, falling GDP means unemployment. However, there is little correlation between GDP and real social welfare. High GDP could lead to widening income disparity. People in richest countries need not seem the happiest. The concept of the ‘hedonic treadmill’ was introduced. ‘Keeping up with the neighbours’. In modern times, different indicators have emerged.

Economic things matter only in so far as they make people happier. – Andrew Oswald

Policies to Correct Markets Can Make Things Worse (The Theory of the Second Best). The real market consists of many distortions which are linked. Correcting one might worsen others. Governments need to act with caution. In some cases, there are no best solutions and distortions can be permanent, thus one has to rely on second best solutions. Sometimes, it is better to leave an imperfection alone rather than interfering.

Make Markets Fair (The Social Market Economy). The Social market was perceived to be fair as it ensured the equal distribution of wealth. Armack believed in the government playing a minimal in the economy. Industry will remain in private ownership but the government will provide several public goods, including pension and taking care of unemployment. Many of the European countries thrived under the social market system. China’s economy is now a ‘socialist market economy with Chinese characteristics’.

Over Time, all Countries Will be Rich (Economic Growth Theories). Poor countries can reinvest their capital into machinery/infrastructure that can increase output to a larger extent than rich countries. This is known as convergence, over time all countries will be rich. This is basically poor countries can grow quickly and catch up. However, Solow’s theory does not hold true in reality. There is little evidence supporting Solow’s theory.

Globalization is not Inevitable (Market Integration). It is the integration of markets. Government’s policies can hinder market integration (fusing many into one). Price differences between different countries are eliminated. Easier transportation contributed to this. Most tariffs have been scrapped. Institutional rules also hinder markets. Dani Rodrik was against ‘deep integration’. Market integration, democracy, and sovereign nation states cannot co-exist. Only two out of the 3 can co-exist. There would be no sovereign nation states should the institutions have to change. Democracy will be affected as well. In modern times, countries avoid deep integration and still keep their institutional rules. Globalization is not all good as well.

Socialism Leads to Empty Shops (Shortages in Planned Economies). The state protects shops from bankruptcy. Therefore, firms do not bother about costs. Therefore, ‘Socialism leads to empty shops.’ Planned economies could not produce enough at the correct quantity. Concept of ‘soft budget constraints’ and ‘hard budget constraints’. Firms had little incentive to supply goods and services efficiently. Kornal argued that the ‘soft budget constraint’ was a feature of the planned economy. Even the major European and US banks were in the ‘soft budget constraint’ category as they feel that they can be bailed out. Even in a free market economy, there are both ‘soft budget constraints’ and ‘hard budget constraints’.

What Does the Other Man Think I Am Going To Do? (Game Theory). ‘Minimax rule’ is to minimize the maximum loss on any turn. Cournot, in 1938, started analyzing the issue of game theory. Game theory is the strategy in which people behave in every situation. People sometimes have to make independent decisions in non-cooperative situations. People will select their best strategy based on the fact that opponents are also selecting their best strategy. ‘Each player’s strategy is optimal against those of the others.’ This is the Nash equilibrium. However, when this strategy is employed, it is often not the optimal result for the group. Therefore, it is better to co-operate. People suffer from bounded rationality.

You know what you are thinking, but you do not know why you are thinking it. – Reinhard Selten

Rich Countries Impoverish the Poor (Dependency Theory). Rich countries exploit free trade by trading with poor countries on terms that favor them. The rich get richer, the poor get poorer. This is known as the ‘dependency theory’. The rich set their own terms and make it favorable for themselves. However, some developing countries isolate themselves and instead, choose to trade among other developing countries.

You Can’t Fool the People (Rational Expectations). Keynes model fails to take into account people’s expectations. Fiscal policies only work in the short run. People anticipate effects of government fiscal policy. They will predict future prices based on an economic, rational model in their heads. Government can take people by surprise in the short run. Under rational expectations, ‘Unemployment is determined by the productive capacities of the economy: the productivity and technological capacities of its firms and the efficiency of its markets. Policy makers cannot boost the economy beyond this level of employment.’ Lucas believed in modelling based on people’s preferences.

People Don’t Care About Probability When They Choose. Humans seek to boost their expected utility. However, people tend to ignore probabilities. People prefer the ‘known unknowns’ to the ‘unknown unknowns’. They show a preference for known odds. ‘People want to know more about the unknown, unquantifiable risks that expected utility cannot account for.’

Similar Economies Can Benefit From a Single Currency (Exchange Rates and Currencies). Some believe in the free floating exchange rate. After WWII, the Bretton Woods system was based on a fixed exchange rate system. However, this led to a balance of payment system (between imports and exports). In Europe, they adopted the floating exchange rate system. If countries are of similar size and growth, they can choose to adopt the same currency as it will eliminate foreign exchange gain/losses. It is not realistic to have a global currency as well. A country with its own currency can control money supply and interest rates. The Euro was an example of a common currency. However, there was certain criteria for countries to meet before they could enter the EU. ‘National debt cannot exceed 60% of GDP and annual deficit cannot exceed 3% of GDP.’ The ECB is now the common central bank. However, risk sharing through transfer of tax revenues did not occur. Individual countries could still set their spending and tax levels. Within the Euro area, massive differences emerged. Some countries had huge deficits, while some had huge surpluses. This led to a few nations requiring bailout, including Greece. There is debate whether a common currency is the best thing for the Eurozone. Even fiscal transfers need political consensus.

Famine Can Happen in Good Harvests (Entitlement Theory). Famine can occur even there is a surplus of food, especially when wages have plunged. The way food is distributed also causes a problem. ‘It is far more common for food supplies to be unavailable to those who need them the most.’ Food price rising also is a major issue that needs to be addressed. Amartya Sen is a major contributor in this field

Contemporary Economics (1970 to present). Friedman opposed Keynesian ideas and believed in controlling inflation. He also believed in the free market. This marked the period of the deregulation of financial institutions. Liberalization of markets. Capitalism did not fair well during the crisis and some were even starting to believe in Marxism. The Laffer Curve.

It is Possible to Invest Without Risk (Financial Engineering). VAR was introduced, so was CAPM. Countries were experiencing inflation in the 1970s and the US experienced trade deficits. Restrictions on the CME was lifted in 1972. Forward and futures contracts emerged. Derivatives were invented to hedge positions. It also provides high leverage. Derivatives contracts were soon traded on the exchange. Cash settled derivatives were very risky, as there was no need to exchange the underlying. It was hard to price derivatives until the Black-Scholes model emerged. There should be a no arbitrage rule. In 2008, the financial markets collapsed in spectacular fashion.

the-economics-book-1-638

God Bless You, Mr Rosewater by Kurt Vonnegut

Eliot Rosewater was the President of the Rosewater Foundation. A sum of money was the leading character in this story about people. The money was placed with a charitable foundation in 1947 for Norman Mushari, a boy. The president post of the foundation would be handed down to Senator Lister Ames Rosewater. All the siblings would be officers of the Foundation by default. The purpose of the Rosewater Corporation was to generate more money through purchase of stocks and bonds of other companies. They owned some other side businesses too. The Corporation gave money to the Foundation but they had no control what each other did. Norman Mushari, of Lebanese decent, was a lawyer who designed the Foundation and Corporation. No one in the law firm ate with him. He wanted to overthrow the foundation. Leech, his professor, told him that lawyers should show to transactions where large amounts of money changed hands.

In every big transaction, there is a magic moment during which a man has surrendered a treasure, and during which the man who is due to receive it has not yet done so. An alert lawyer will make that moment his own, possessing the treasure for a magic microsecond, taking a little of it, passing it on. If the man who is to receive the treasure is unused to wealth, has an inferiority complex and shapeless feelings of guilt, as most people do, the lawyer can often take as much as half the bundle, and still receive the recipient’s blubbering thanks. – Leech

Eliot Rosewater was the senator’s son and suspected to be insane. Eliot became president of the foundation in 1947. Mushari investigated him some 17 years later. He wanted to prove that Eliot was insane. Eliot’s grandpa became rich in the past by bribing the government and by buying all the farms in Rosewater County. He owned many stakes in the county’s other operations. The problem of society was that personal wealth had no limit to it. This was the American class system. Praise was given to those who committed crimes against which no laws had been passed. Those hardworking people were bloodsuckers and only the mighty powerful few controlled the county. The rich were too obscenely wealthy. ‘Grab much too much, or you’ll get nothing at all’. Samuel married Geraldine Ames Rockefeller. He didn’t believe in a utopia, yet he spent a lot of money on expensive paintings. Lister Ames Rosewater married Eunice Eliot Morgan. Eunice was a chess master in her heyday. She died in an accident and was concerned about the poor. My father, Lister, worked in the Congress as a senator and taught morals. He gave 95% of his inherited wealth to the Foundation. Eliot married Sylvia DuVrais Zetterling, a beauty of a woman. Later, Eliot became a drunkard and an aimless fool. His advice in a letter for the new President of the foundation was to be sincere towards the poor. Mushari requested letters from Sylvia for his investigations and eventually got them.

Eliot’s father was a senator. He went to good schools, but was never outstanding. Later, he volunteered for the US infantry. Soon, he graduated with a law degree and took over the Foundation. He was a heavy drinker too. The foundation helped a birth control clinic. Eliot spend a lot of the foundation’s money. Eliot said this in a science-fiction writers’ event.

Many, many good things have I bought! Man, many bad things have I fought! – Eliot Rosewater

You’re the only ones with guts enough to really care about the future, who really notice what machines do to us, what wars do to us, what cities do to us, what big, simple ideas do to us, what tremendous misunderstandings, mistakes, accidents and catastrophes do to us. You’re the only ones zany enough to agonize over time and distances without limit, over mysteries that will never die, over the fact that we are right now determining whether the space voyage for the next billion years or so is going to be heaven or Hell. – Eliot Rosewater

He wished for Kilgore Trout. He admired him when no one else knew about him. Mushari thought Trout’s books were dirty. Trout longed for an impossibly hospitable world. ‘What in hell are people for?’ Eliot was a fireman. He admired people who worked in the infantry. His father had high hopes for him when he was young. Eliot drove away his rich friends because they were only lucky. Now Eliot went back into the arts and sciences and was popular again. His analyst and him often spoke about American history.

And what methods did Caesar Augustus use to put this disorderly house in order? He did what we are so often told we must never, ever do, what we are told will never, ever work: he wrote morals into law, and he enforced those unenforceable laws with a police force that was cruel and unsmiling. He made it illegal for a Roman to behave like a pig…Did it work? You bet your boots it did! Pigs miraculously disappeared! …This was known as the Golden Age of Rome. – Eliot Rosewater

I see two alternatives…we can write morals into law, and enforce those morals harshly, or we can return to a true Free Enterprise System…I emphatically favor the latter alternative. We must be hard, for we must become again a nation of swimmers, with the sinkers quietly disposing of themselves. – Eliot Rosewater

Eliot saw similarities between himself and Hamlet. He left his wife and wanted to roam. Later he was arrested in Texas. He believed in equal distribution of wealth. He wanted a revolution led by infantry veterans and volunteer firemen. Eliot was going crazy and thought his wife was Ophelia. The problem was that he didn’t want to reveal his location. The foundation owned many real estate. Eliot was in the Rosewater County and felt that was his true home. He was there to care for people. All the factories were mechanized and there was no need for humans. No one cared about there.

I look at these Americans and I realize that they can’t even care about themselves any more – because they are useless. I’m going to be an artist. I’m going to love these discarded Americans, even though they’re useless and unattractive. That is going to be my work of art. – Eliot Rosewater

Many people lost money in their investments in Rosewater. The brewery on the county was a real proud thing to have. There was a saw company there too. There was a veteran’s memorial park too. It was like a monarchy run by Eliot. Many people from Avondale respected him. Eliot and Sylvia throw rich banquets for poor people. They took care of the poor people. Later, the people of Avondale started to rebel. Sylvia suffered a nervous breakdown 5 years later. She entered a mental hospital. Ed Brown was the psychiatrist and Charley was the Fire Chief. The treatment made her dumb but sedated her consciousness. Samaritrophic treatment wouldn’t work on Eliot because he was too strong willed and compassionate. Later, Sylvia would enter stages of paranoia. She was happy for a moment before she was crazy again. She still wanted to help the people in Rosewater. Divorce proceedings finally begun. People thought that if Eliot wasn’t drunk, he wouldn’t care about the people. Although he had an awesome life, he was rich and stuff, he didn’t like it. He could have been the president of the US, but chose not to and look at where he ended up now. Eliot was a fat man now, so unlike the days when he was with the US Army.

To help people, Eliot needed medicine too. Astronauts bored them. His father wished that Eliot and him were both dead. Sylvia didn’t want a reconciliation with Eliot. She felt worthless and thought about suicide. The senator that the people Eliot were helping were worthless and useless. Lightning turned everything to blue-white diamonds. When he was a fireman, Eliot was always busy fighting fires. ‘This is the Rosewater Foundation. How can we help you?’ Only a handful of people tried to leave Rosewater County to find proper work. Diana Moon Glampers, a hopeless old woman, was too dumb to live and called Eliot. She was the cleaner of the Rosewater mansion. Her parents died from lightning attacks. Eliot said that he would try to help her because she was scared of electricity. Eliot cared about too many people and didn’t want to see them die. She said life was hopeless because of her health problems. She complained about her kidneys and Eliot wanted her to visit a doctor. The doctor said that the problem with her kidneys were because she was overthinking it. She respected Eliot for living a humble life where he could help others.

You gave up everything a man is supposed to want, just to help the little people, and the little people know it. God bless you, Mr. Rosewater. Good night. – Diana Moon Glampers

The senator didn’t like his son. He blamed himself for the misfortune for how Eliot turned out. During the WWII, Eliot accidentally killed three unarmed firemen when he raided a place by throwing a grenade. Later, Eliot wanted to kill himself and laid on the road. Luckily, the vehicle stopped in time. Eliot despises art and feels that it failed him. Discrimination happened when you loved someone more than another. There was a man, Arthur Ulm. Eliot gave him money simply because he wanted to tell the truth without any economic consequences. Eliot allowed him to pick his own subject. Sylvia were talking to the senator and McAllister in the room. There was one poem which was Eliot’s favorite. Eliot hated the arts but liked writing poems. ‘If you would be unloved and forgotten, be reasonable.’ Eliot was now reading a book by Arthur Ulm. Ulm wrote about how horrible society was and was thankful for Eliot’s encouragement along the way. The Senator rued not taking care of Eliot when he was younger. In the past, a psychoanalyst was being difficult with the Senator and asked what the definition of obscenity was. To the Senator, sending people to prison even though they committed a small crime was not obscene. The psychoanalyst told him that if a man gets aroused by something other than a woman, he was a pervert. Every case of perversion was a case of crossed wires. Eliot was bringing his sexual desires to Utopia.

If a man has but one child, and the family is famous for producing unusual, strong-willed individuals, what standards can the man have for deciding whether or not his child is a nut? – The Senator

If Eliot is going to love everybody, no matter what they are, no matter what they do, then those of us who love particular people for particular reasons had better find ourselves a new world. – The Narrator

We don’t piss in your ashtrays, so please don’t throw cigarettes in our urinals. – Poster

Two-Seed-in-the Spirit Predestinarian Baptist. That’s what I generally say when people insist I must have a religion…Foot washing is practiced, and the ministers draw no pay. I wash my feet, and I draw no pay. – Eliot Rosewater

Those who write on Heaven’s walls should mold their shit in little balls. And those who read these lines of wit should eat these little balls of shit. – Eliot Rosewater

Heaven is the bore of bores, so most wraiths queue up to be reborn – and they live and love and fail and die, and they queue up to be reborn again. – Eliot Rosewater

A man dialed the black phone and Eliot answered. He admitted that he was worst than nothing. It was a hotline for people to dial when they wanted to kill themselves. People thought that Eliot was a saint who gave love and money. Eliot dreaded a moment, but didn’t say what it was. Eliot said he represented the government. The man invited him over to his house after Eliot challenged him ‘I’d ask you to name the rock-bottom price you’d charge to go on living for just one more week’. Later, Eliot recorded the man’s details in a book and awarded him a Rosewater Fellowship of $300. Those were grateful for Eliot’s help would help him swat flies in his office. Eliot didn’t want to be reborn. He didn’t believe in a Heaven. Someone else dialed the helpline. She was Stella Wakeby. She complained that people used to stand on their own two feet. She called just to inform Eliot that the Wakebys were fine. The problem was that she wanted to be a Senator Rosewater person but can’t now and had to be an Eliot Rosewater person. Then his dad called him one fine day. His dad didn’t like that he was talking down to him. In a moment, his dad wanted Eilot to question about his dream and reflect on how he entered such a disreputable condition. He loved his life and didn’t want to buy expensive paintings again. Eliot had communist thoughts in a way when he wanted to help others. He wanted people to share more. In a moment of reflection, he knew that the Rosewaters were born near the money river. The senator suggested that people should work hard instead. Eliot believed that to be rich, one had to go to the money river and interact with the rich and the powerful. He didn’t believe that life was fair to the poor sometimes. Eliot gave everyone notes that read ‘I love you’. However, his dad didn’t want to receive any of that. Later, his ex-wife, Sylvia got to speak to Eliot. Initially, Eliot didn’t want his wife to care about anything. Mushari was suspicious when he overheard Eliot wanting to baptize young children.

I think it’s terrible the way people don’t share things in this country. I think it’s a heartless government that will let one baby be born owning a big piece of the country, the way I was born, and let another baby be born without owning anything. – Eliot Rosewater

Born slurpers (people obsessed with money) never admit that they are. And they can’t imagine what the poor people are talking about when they say they hear somebody slurping. They don’t even know what it means when somebody mentions the Money River. – Eliot Rosewater

Eliot and Sylvia agreed to meet again for once. Mushari was eavesdropping on their conversation. He wanted control of the Foundation to go to Eliot’s second cousin, Fred Rosewater, so that he could get a cut of the proceeds in future. Fred was a very ordinary man and wasn’t aware that he might get rich. A lot of people in Pisquontuit were rich but their lives lacked wisdom, wit and invention. Fred was poor and worked hard. To get rich, one would had to insure themselves and then die soon because Fred sold insurance. His wife was Caroline and he had a kid named Franklin Rosewater. Fred didn’t know his ancestors. The bible says ‘business is business.’ George Rosewater filed no suit against his brother, Noah but they never communicated since. Later, George left Rosewater County and went East. George was blind after being involved in an accident. Later, he married an orphan (Faith Merrihue) who took care of him. Fred did think about killing himself sometimes. Fred loved it when his bride came to thank him for being so nice and for the things he had done

With a simple stroke of the pen, we’ve created sizable estates. That’s the miracle of life insurance. That’s the least we can do for our brides. – Fred Rosewater

Fred practiced ennui now. There were many in the newspapers advertising themselves because they wanted love. When reading, Lila (daughter of his wife’s best friend) appeared. She was a good sailor with Pisquontuit Yacht club. Harry, a fisherman, came to talk to Fred. He used to sell insurance until he nearly died on some chemical and vowed to work outdoors instead. Harry didn’t seem to like insurance. He also didn’t believe in matrimony. Harry filled in the form but filled Fred’s name at the end of the form to know women. Caroline and her lesbian friend, Amanita, liked to hang out. She married thinking Harry was rich but in the end, he was not. To her, money could solve all issues. Fred complained about treating Amanita and supporting his wife, because the meals were expensive. Lila was the daughter of Amanita. Amanita kept wanting to get richer. Later, Lila got dirty pictures because she scoured through the raunchy ads in the American Investigator. Lila hung out with Fred once in a while. Fred had cuts on his legs because his wife didn’t keep dangerous objects out of the way at home. Later, Fred picked up a novel by Kilgore Trout in the library.

Lila admired how some people didn’t have to work very hard and yet were rich. One day, she realized her father Stewart Buntline was asleep. He had 14 million dollars. Stewart didn’t know much about business and was a recipient of a Trust fund. He was represented by the reputable law company that represented Senator Rosewater. Reed McAllister was the partner. McAllister was generally told Stewart about socialism as Stewart didn’t believe in the free enterprise and wanted to give all his money to the poor in the past. Now, Stewart for some reason, believed in free enterprise fully. Stewart didn’t care about sex and misguided pity. McAllister thought that the chronically unemployed were very pitiful and was mankind’s creation. He revealed long ago that some men were born to lead, and that there was a possibility that they didn’t revel in it. Long ago, he said that saints wannabe like Stewart were nothing special. Stewart approached McAllister after his first year at Harvard.

History tells us this, if it tells us nothing else: Giving away a fortune is a futile and destructive thing. It makes whiners of the poor, without making them rich or even comfortable. And the donor and his descendants become undistinguished members of the whining poor. – Reed McAllister

Your fortune is the most important single determinant of what you think of yourself and of what others think of you. Because of your inheritance, you are extraordinary. Without it, for example, you would not now be taking the priceless time of a senior law partner. If you give away your money to the poor, you will become utterly ordinary, unless you happen to be a genius. – Reed McAllister

Without money you’ll surely be less comfortable and free. Not only that, but you will be volunteering your descendants for the muggy, sorehead way of life peculiar to persons who might have been rich and free. – Reed McAllister

People get what they deserve. That’s the First Law of Life. – Bunny Weeks

Money is dehydrated Utopia. ‘That to be born rich and to stay rich is something less than a felony.’ Fred, Caroline Rosewater and Stewart and Amanita Buntline all owned yachts while Harry owned a fishing boat. Harry had two sons who were also fisherman. Caroline was very impressed with Amanita and looked up to her. Bunny hugged Amanita. The senator would be resigning soon and Bunny could never remember Caroline well. Bunny challenged Amanita and Caroline to guess what he bought and they would get the product free if they guessed correctly. Caroline was very thrifty and didn’t want Amanita to buy it for her in the end when they couldn’t guess what it was. Amanita went ahead to buy. Bunny Weeks once owned an expensive restaurant. Harry and his two sons were fishing frantically but were hopeful of a big catch. Harry killed 8 great tuna. The boys smiled and seemed very happy at their feat. Suddenly, Caroline commented that Harry was like a God. Bunny believed that Harry and his sons would go bankrupt some day and that was no need for men to work with their hands and backs as they were not needed by society. He commented that men like Harry were losing.

They made her recite this every morning ‘I do solemnly swear that I will respect the scared private property of others, and that I will be content with whatever station in life God Almighty may assign me to. I will be grateful to those who employ me, and will never complain about wages and hours, but will ask myself instead, “What more can I do for my employer, my republic, and my God?” The verse

I understand that I have not been placed on Earth to be happy. I am here to be tested. If I am to pass the test, I must be always unselfish, always sober, always truthful, always chaste in mind, body, and deed, and always respectful to those whom God has placed above me. – The Verse

Mushari drove to find Fred Rosewater. Fred was sick in bed. He turned out to be on his sailboat. Selena was an orphan who worked for the Buntlines now. Selena wanted to be a nurse. Wilfred Parrot was the head of the orphanage and Selena wrote to him. Selena was often scolded even though she didn’t open her mouth but because in Mrs Buntline eyes, she thought that from her facial expression that Selena was disagreeing with her. Once, Mrs Buntline played Beethoven at 78 revolutions per minute instead of 33 and it still sounded like Beethoven to her. Caroline Rosewater also kept agreeing with her. Selena wanted to speak us but couldn’t as she was scolded. Once, I watched Lila sail. She was a brilliant sailor. During the sailing race, Mrs Buntline yelled like she had rabies and acted all so crazy. You thought that everything in the world depended on the race. Mrs Buntline once took Selena out to view sunset but only waited for her to say ‘Thank you very much’ before she was satisfied. Since then, Selena thanked her for the ocean, the moon, the stars in the sky, and the United States Constitution. Mushari toured the Runfoord Mansion. The thing was that The Rumfoords were still alive, hated the public, but still collected money from entrance fees. The previous founder did this once every 5 years so that he can get a sense of what the ground was like. Lance Rumfoord came and poked fun at Mushari. Caroline was drunk in her room. Fred wanted to kill himself but remembered about Franklin, his son. By accident, Fred chanced upon a pornographic picture that Franklin bought from Lila Buntline. He was in shock. Fred found a historical document about his family in the basement and started to read it. Rosewater was a pseudonym used by the oldest trace back to his roots, James Graham. He was a nobleman who eventually wanted to be a simple farmer. Frederick was John’s son and was the ancestor of Rhode Island Rosewaters. Fred took Caroline down to the basement and he said to her that he was proud of his history and that they used to be somebody. He was fed up that he usually started conversations with ‘Excuse me’, instead of Hello or Goodbye! Caroline liked to agree with people and was dumb in nature. It was when Fred was trying to kill himself that Mushari came in and told him that he stood to inherit a great sum of money. Fred fainted.

What gets me most about these filthy rich people, isn’t how ignorant they are, or how much they drink. It’s the way they have of thinking that everything nice in the world is a gift to the poor people from them or their ancestors. – Selena

So we’re poor! All right, we’re poor! This is America! And America is one place in this sorry world where people shouldn’t have to apologize for being poor. The question in America should be, ‘Is this guy a good citizen? Is he honest? Does he pull his own weight? – Fred Rosewater

It was time for Eliot to meet Sylvia in the Bluebird Room. Many people in Rosewater were sad to see him leave. Delbert Peach was a drunkard who started acting like a dog. He thought that Eliot would not return. Eliot said that he definitely won’t be leaving. Mr Peach swore off liquor as a tribute to Eliot. Eliot was angry when Mary Moody called the fire department and said the fire was in my heart. He blasted Mary for abusing the hotline. She later called the counselling line and was crying. Eliot didn’t know why she was crying. Later, his father visited him. Peach commented that the Senator was rude to him. The senator didn’t really care about America. Dad mentioned that someone was trying to prove that Eliot was insane. Just then, Eliot sounded the fire alarm. It was high noon in Rosewater. Eliot was shocked but he did have doubts on his sanity. His dad wanted to leave Rosewater for good and return home. He thought Eliot was crazy to live in Rosewater, no matter how he wanted to defend himself. Eliot told a story by Trout to his dad and his dad was pissed. In a country, the sole purpose was to eliminate all odors. Instead of creating a chemical that would eliminate all odors, he eliminated noses. Eliot showed his naked body to his dad and later picked up the phone when it rang. The woman on the line felt that others might think Eliot was crazy for paying so much attention to them. Everyone on the county was afraid to see him leave. His dad complained that Eliot smashed every ideal he held, unknowingly. Later, his dad stormed out. The phone rang but Eliot didn’t answer it this time.

You’ll get up there to Indianapolis, with all the excitement and lights and beautiful buildings, and you’ll get a taste of the high life again, and you’ll hunger for more of it, which is only natural for anybody who’s ever tasted the high life the way you have. – Delbert Peach

He couldn’t remember his fight with his father. He entered Chief Charley’s insurance office. Eliot paroled a guy who was now the cleaner. He was Noyes. The man never thanked him but Eliot didn’t need gratitude. His memory was failing him. People knew that he wasn’t okay anymore. A man mentioned that he could tell when a man ‘clicked’. This would mean that he went crazy. He would start doing exactly what his brain told him. Noyes was jealous at Eliot for achieving it. Eliot felt a new phase of his life was beginning. Lincoln Ewald hated money and scorned at America. Eliot couldn’t remember people’s names now. Roland thanked Eliot for saving his life. The ticket lady stamper his ticket to Indianapolis. Now, Eliot read about Kilgore Trout. Diana Moon suddenly appeared. Eliot looked back at Rosewater. He didn’t miss it at all. The outskirts of Indianapolis were destroyed in a fire-storm and Eliot witnessed it.

She cried and said ‘You’re my church group! You’re my everything! You’re my government. You’re my husband. You’re my friends.’ Diana Moon Glampers

Eliot woke up in a dry fountain. He was in a mental hospital now. Eliot kept observing a bird. Four men were in business suits near him. All of them looked sympathetic. There was a lawyer and a doctor. Strangely, Eliot couldn’t recall what he wanted to say. The doctor was not confident that Eliot could prove himself not to be insane. Then in his pocket, Eliot read about the lawyer and his client, Fred Rosewater. Senator actually brought Trout here because Eliot wanted him around. Trout recited to him exactly what must be told in tomorrow’s hearing. How do you love people who have no use? Trout mentioned that firemen were useful when putting out fires. The thing was that the Senator and Trout got along very well. Trout knew that Eliot offered unconditional love to others, without expecting anything in return. 57 women in Rosewater claimed that Eliot was the father of their children. Mushari went around town and persuaded others to say bad stuff about Eliot. Suddenly, Eliot managed to recall some stuff and he wanted to write checks. There were 3.5 million dollars and Eliot gave 100k to Fred, his cousin. As for the remaining money, Eliot told his lawyer to give them to the children of Rosewater County. On the last note, Eliot said ‘And tell them, to be fruitful and multiply’.

In time, almost all men and women will become worthless as producers of goods, food, services, and more machines, as sources of practical ideas in different areas. So if we can’t find reasons and methods for treasuring human beings because they are human beings, then we might as well, rub them out. – Kilgore Trout

Americans have long been taught to hate all people who will not or cannot work, to hate even themselves for that. We can thank the vanished frontier for that piece of common-sense cruelty. – Kilgore Trout

Poverty is a relatively mild disease for even a very flimsy American soul, but uselessness will kill strong and weak souls alike, and kill every time. – Kilgore Trout

Firemen rush to the rescue of any human being, and count not the cost. The most contemptible man in town, should his contemptible house catch fire, will see the fireman put the fire out and he will be comforted and pitied by the Fire Chief. There we have people treasuring people as people. It’s extremely rare. So from this we must learn. – Kilgore Trout

god-bless-you-mr-rosewater

2BR02B by Kurt Vonnegut

This was a world with no prisons, slums, poverty, war etc. Disease was not present. Only 40 million Americans were present. The average age was 129. Wehling was waiting for his wife to give birth to triplets. Men had to volunteer to die. An old man was painting a mural of men and women working in a garden. It was called ‘The Happy Garden of Life’. Benjamin Hitz was one of the hospital’s obstetricians and was a handsome man. All the faces in the mural had to be filled. However, the painter’s idea of life was more murky and sad. There was a number you could dial if you didn’t like living ‘2BR02B’. ‘To be or not to be’ was the gas chambers in the Federal Bureau.

The orderly questioned the painter (grandpa) when he wanted to leave society on his own. The painter wanted more mess in the world. A lady dressed in all purple entered the room. She had facial hair and worked for the Federal Bureau. She was Leora Duncan. The painter wanted her to choose a figure in the mural where he could place her face on. She ought to be the snipper or pruner as that character better suited her role in life. Hitz set up the gas chamber in the country. She was placed beside him in the picture and had the image in which she sawed a limb. In reality, she also worked for Hitz. In their world, you needed to find three volunteers who would die in order to admit the triplets into the world. Dr Hitz wanted to visit the triplets which were just born. Wehling was planning to only select one child, let the other two die and then volunteer his maternal grandpa to die.

Dt Hitz wanted to control the population size or it would keep increasing and the Earth wouldn’t be able to support so many people. Hitz called the chamber the catbox, but it didn’t feel right. It gave people the wrong impression. Wehling actually wanted to keep all 3 children and his grandpa. Hitz changed the name to ‘Ethical Suicide Studios’. Suddenly, Mr Wehling drew his revolver and shot Leora, Hitz and then himself.

This left 3 new vacancies for the newborns to enter the world. The painter looked at all this. He thought that without population control, the Earth would have other bad things, like war, plague, starvation etc. It was a grim, grim world, no matter how he thought . He stopped painting and wanted to shoot himself. Then, he stopped and called 2BR02B instead. The message over the phone said…

‘Your city thanks you; your country thanks you; your planet thanks you. But the deepest thanks of all is from future generations’.

2 B R O 2 B