Economics

Modern Humanity is defined by economics: the economics of production and consumption among groups.

Early man and some other animals produced and consumed by hunting, harvesting, building, defending and sharing.?There was even some division of labor, often by age or gender.?All of these were generally subsistence activities with some storage for future use.

At some point, mankind’s production increased through more specialization and technological advances. Standards of living increased and surpluses were created.?Trading of surplus production began, first in family groups and then in larger communities.?As production, technologies and trade got more complex and widespread, so was the need for defenses.?There also emerged the need for recordkeeping, for stores of value and for a medium of exchange. ??

Government was developed in support of production and trade, providing both defenses and coinage as a medium of exchange and store of value.?Government became overhead in support of production and trade; taxes were invented. ?Over the millennia, government has waxed and waned, often forgetting that its role was to be one of support and defense for individual and group production and trade.??Hubris and greed sometimes directed the actions of the governments.?Eventually, nation-states used armies to seize production from others.

Mechanisms for recordkeeping, stores of value and medium of exchange became coordinated and standardized in support of remote and complex, multi-partner trade.?Precious and semi-precious metals became the staples for mediums of exchange and stores of value.?Eventually, paper money, backed by the precious and semi-precious metals, became even more convenient as the medium for trade.

Production, technology, standards of living and populations climbed and climbed, throughout the ages, although with hiccups along the way. ??Whenever, governments overplayed their hands as supporters of production and trade, the producers and consumers suffered.?(As an aside, before our US currency was inscribed with “In God We Trust”, it was stamped with “Mind Your Business”.)

After World War II, the United States helped set up a truly international system for production, trade and defense that was unique in world history.?At the same time, international law, international banking and sanctions supplemented national military power for enforcing international peace (Pax Americana).

The US Dollar had joined precious and semi-precious metals as stores of values and for international trade.?But again, hubris and greed set in and the US abandoned metals and made the Dollar a fiat currency and separated fiscal and budget policy from the market economy.?The strength of the US and the fact that petroleum (and other) trade has been tied to the Dollar has held things together with the US Dollar being the de facto Reserve Currency, just as the British Pound, Dutch Guilder and Venetian Ducat had once been.

We?have allowed China to become ascendant as the producer of many manufactured goods for the world, we have allowed Russia to achieve a position of significant control over the energy supply for Europe and we have restricted our own energy independence, export and manufacturing.?China, Russia and others are moving to replace the US Dollar as the Reserve Currency. Plus, the government is attempting to smother in the crib emerging digital reserve currencies, while developing a digital fiat currency US Dollar that will make it possible for the government to control all aspects of the formerly (somewhat) free marketplace.?Control over the earning, spending and saving of Digital Dollars (Existing currency will be phased out.) will give control of all production, consumption and trade to the government. ????

This is what is going on behind the news reports that keep us occupied and distracted.