This is how economics evolved. This is a metaphor.
Bill
is a caveman back in primitive days. He lives in a cave. He lives
in a community among other cave dwellers. Some hunt, some gather, some
cook, but not Bill. Bill crawls in the dirt, using his hands to make
holes in the dirt. He drops seeds into the holes. When he is finished
planting, he goes out to gather. He is not good at hunting so he only
gathers. The seeds grow. Bill eats. Bill barely survives.
Bill has a neighbour, Tom. Tom is a
hunter. He works hard. Hunting is dangerous. Some of his friends have
been killed hunting. Still, he does it.
Now, Bill and
Tom have a neighbour Jack. Jack thinks. He thinks what Tom does is
dangerous and only marginally profitable. He thinks what Bill does is
not the most effective way of doing what he does. Jack comes up with an
idea.
Jack takes a stick; he walks across the field
poking holes in the ground. Then, using a hollow reed, he drops a seed
through the reed into the hole. He plants many seeds.
When
Jack is through, he gathers. Because he has more time to gather than
Bill does, Jack gathers more food than Bill does. Jack has more food to
share, so he trades food with Tom who hunts. This causes Bill a problem.
He does not have enough food to buy meat from Tom, so he eats less.
Jack’s
farm prospers. He not only gathers and trades he now reaps and trades.
He trades food with Bill for labour. Bill now works on Jack’s farm in
exchange for food.
Jack now has twice as much food so
he stops gathering. He cultivates more land. He grows more food. Now he
can trade more food for more labour. The gatherers find Jack’s steady
supply of food to be a better alternative to gathering.
Tom,
seeing how the investment system works, and with meat scarce and
vegetables in plentiful supply, he charges Jack more for the meat. Jack
pays happily. In addition, with the lessons he’s learned, Tom teaches
others how to hunt, where to hunt, and supplies them with the tools to
hunt. They pay for their lessons with some of their meat. He pays them
for hunting with some of the vegetables.
Tom’s hunters increase the quantity of meat. Jack’s farmers increase the quantity of vegetables.
However,
there is another problem. It takes time to make tools to farm the land,
weapons to hunt for meat, and it takes time to make clothes from the
skins.
Enter, James. James also thinks. He sees an
opportunity. He agrees to supply the hunters and the farmers with tools
and weapons and clothes.
He gets together with some of
the less successful hunters and gatherers and promises to pay them in
meat and vegetables in exchange for their labours making tools and
weapons and clothes. They don’t have to hunt. They don’t have to gather,
and they can eat. That works for them.
James begins
his business. Soon, more people are making tools, weapons, and clothes.
More people are farming. More people are hunting. However, things are a
bit dull despite the prosperity. Enter the arts. (It will be centuries
until things become dull because of the prosperity.)
Tom, Jack, and James can afford to take time to pursue the arts. However, they are not very good at it. Enter, Dave.
Dave tells stories. He is paid with food.
Susan can paint. Susan is paid with food.
Peter, Paul, and Mary can sing. They are paid with food.
Mark
and Lorraine get an idea. They seek out people who can tell stories.
They arrange for storytelling. They charge people to come to listen to
the stories and pay the storytellers with a part of the profits.
Susan, who can paint, teaches promising students to paint and helps them sell their paintings taking a commission on the sales.
Things
are moving along reasonably well with the exception of dragging around
sacks full of food and dead carcases. Moreover, there is quibbling. They
agree to seek a solution from the elders. There, they listen to the
elders suggest the formation of a council.
With time on
their hands, and the evidence of intelligence, Jack, Tom, and Dave
become leaders appointed by the elders. For whom everyone has respect.
Together
they create a medium of exchange. Then, they issue an RFP and
subsequently someone creates a food storage system. The people start
schools where the experienced hunters and farmers can teach hunting and
farming. Singing, storytelling and painting are also taught. However,
there will always be troublemakers. At first, they are handled by a few
of the leaders. Then the leaders appoint a shire reeve who calls a posse
comitatus to handle problems when they arise.
Some
people are smarter than others are. However, they are not creative; but
they are inventive. They invent ways to make tools using metals. Some
invent more expansive tools and machinery. They learn to grind wheat and
make bread. Others figure out how to harness the water to turn
gristmills. Others are natural born salesmen. They go out to sell the
products of the industrious people of the community.
The
community grows. Soon, other communities follow suit. People take what
they have learned, their stock-in-trade, to other communities to help
them plan their communities.
Some communities with more
of something to sell sell it to those communities with more of
something else to sell in exchange. Foreign trade is born. Treaties are
signed. Thus, civilisation arises from the very dirt that Bill used to
crawl in digging holes with his hands to plant seeds.
This is the entry to understanding economics.
Regards,
Slim Fairview
Mail slimviews@gmail.com
Copyright (c) 2011 Slim Fairview
