Zero at the Margin

We see in nature that big differences express at the margin of a coded existence. The DNA of a worm and a human is marginal but its existence is so different that it cannot be described as marginal.

The application of power is much the same way. Power accumulates and distributes (gains dynamic support and resistance, which is measured as being integral or derivative by the calculus) to attain the legitimate value of a demonstrated utility. The observable (calculated) effect suggests a meaningful, causal purpose or objective reality that, over time, is anything but zero.

For example, look at how TIF (tax-incentive financing) utilizes market risk to exercise power. As states and municipals compete for consolidated dollars across jurisdictional boundaries, the tax liability is reduced for big business (“natural monopolies” that “make” markets more efficient). The liability is not nearly zero, it’s less than zero (now that’s efficiency!), and the cause is not free-market mechanics but consolidation of wealth and power.

What is the TIF financing?

Supposedly, TIF has a multiplier effect, but we are experiencing global demand-deflation. It appears to be having the opposite effect!

Stop having employees pay employers to have a job through tax-incentive financing and there will be the funding for infrastructure, which has an anti-deflation, multiplier effect. The way it is now, we have to borrow the money from the tax-incented employers to have a job AND to finance infrastructure, which accounts for a huge debt-equity ratio AND global demand destruction.

Here we are then, with an excessive debt-equity ratio that demands TBTF financials bail it out, managing the risk on demand (yielding to a social contract) like the old days. Here we are, exploiting the detriment of others with TIFs and Synthetic Interest Rate Swaps. Remember, swaps are one of many derivative devices (contractual obligations) big bankers and insurance companies (like AIG) used to yield the Great Recession (and Dodd-Frank to contain the menace).

Now, if Republicans take the Senate they will modify regs on derivative contracts. This means we do the Great Recession again in short order.

Is that what we want?

With equities now suggesting a technical correction, the DOW at 18k is entirely possible on demand!

See, look at how things naturally work out.

The pursuit of wealth and power is anything but measurably zero (or less) at the margin, isn’t it?

Also consider that, naturally selected, the active agents of a pathological pursuit of wealth and power functionally utilize risk to the greatest good. What appears to be a dysfunctional pathology to the uninitiated (people that don’t have the secret knowledge) is really like the virus that innovates potential change utilized in the process of natural selection.

The menace (the immoral value of the perceived detriment to be regulated by any means, whether a free market on demand, or any other sovereign authority on command) does not really exist. So (conservatives say) the legitimate means to regulate it (the utility) really does not exist–it is unnatural.

Realignment of the Senate is an expected value (you see), naturally selected to realign the values to a more natural existence.

(So let’s say you take your car in for a tune up, a tire rotation, and realignment. The mechanic says “with this and that derivative device”–which is all Greek to you–he can make the car more efficient. Now, you’re going down the road, the engine catches on fire and the wheels fall off.

It makes all the sense in the world to take it back to the mechanic, who wrecked it, to fix it IF…

being too big to fail, he is the only mechanic in the world!

Notice how “the risk” is fully contained so that the loss is “fully assumed” in priority, zero at the margin.)

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About griffithlighton

musician-composer, artist, writer, philosopher and political economist (M.A.)
This entry was posted in Political-Economy and Philosophy and tagged . Bookmark the permalink.

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