Economic Systems

What is an Economic System?

Take these two elements:

productive things that need to be done, and
people who are able to do productive things.

An economic system is a set of social rules that brings together those two elements.

Problems with Economic Systems

Every economic system, past and present, shares one unfortunate feature: all of them are very much less than perfect. It is generally possible to criticise economic systems of the past; you won’t be treading on very many toes. There are fewer opportunities to point out problems with current economic systems.

Acceptable Criticism

Acceptable criticism of current economic systems might include pointing to the compulsory existence of a surplus pool of labour. There is a certain number of vacancies, and there is a larger number of unemployed people. The numbers in each category will vary over time, but there’s always a surplus population. Pointing to this feature is permitted, provided you don’t do anything dangerous like question its inevitability.

Unacceptable Criticism

Unacceptable criticism might include looking at all the possible things that could be done and comparing them to those things that are actually done. There are plenty of useful, beneficial things that don’t get done, and plenty of trivial, unnecessary things that do get done. Want to buy some useless gadget that you’ll be persuaded to replace next year when a shinier, sleeker, but equally useless model comes out? Here it is! Want decent health care? Sorry, we can’t afford it.

Why Does it Happen?

There is, of course, no magic. Economic problems are not like earthquakes or tidal waves, problems that are bound to happen, and which you can merely protect yourself against to a greater or lesser extent.