Incomplete analysis

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I pick up the Sunday paper frequently. I’m often rewarded with a story or column. The Feb. 2 Forum is a good example. The commentary on Marxist analysis (“Marx Is Back”) was close to being complete, except for the false comparison of wages across countries and over time. Dollar figures do not address the concept of subsistence wage.

A more complete comparison would have the amount of value extracted from, say, a miner in Pennsylvania versus one in China. Factor in things like the cost of regulation, safety, noncorrupt police, reliable water and electricity, roads and house values, and a miner in Pennsylvania may make significantly more in dollars but the costs of living a first-world life mean a lot of taxes and huge investments by business to run an operation. Subsistence wages may be very high. Costs may be less in the Third World, but the rate of exploitable value may be less, too, and subsistence wages correspondingly low.

Still, with detail lacking in the article, my disappointment was offset by seeing two other articles that point out how primitive yet idealist economic science seems to be. The article that strained to chide the late Pete Seeger for dying with $4 million (“Pete Seeger and His Riches,” Perspectives), passed briskly over the amounts he seems to have earned over decades. What could he have been worth if he was more entrepreneurial?

Of course, missed points like subsistence and net worth are to be expected when the obituary for the late Dale Mortensen (“ ‘Search Theory’ Mastermind Who Won Nobel Prize”) shows he could win a Nobel Prize in economics, shared with two others, for discovering that it takes the unemployed time to find jobs and employers time to find workers. This was only a mystery to a discipline that would imagine a perfect market theory. As if the world was made for theory and not theory made to explain the world.


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