classic textbook, Economics: “The study of how societies use scarce resources to produce valuable commodities and distribute them among different people.” These days that looks all wrong. What we study now is how societies use infinitely abundant resources of electrons to produce utterly worthless “content” and distribute humongous moola among the same people: Elon Musk, Jeff Bezos, and Bill Gates. However, both of the above definitions of economics are nonsense. Economics is simpler than that. Economics is feeding, clothing, and sheltering ourselves. How we do it may alter out of all recognition. Why we do it is as immutable as human nature. There may be people who have a strong desire to be hungry, naked, and homeless. Medications can be helpful. The rest of us would prefer to sit down to a hearty meal in a warm, dry place, and unless we’ve been spending a lot of time at the gym, we should put our clothes back on. Simpler-than-that is the kind of economics this book is about. It asks two questions that do not fade to gray or go lame with age. The first and most important question is, “Why are some countries rich and other countries poor?” The second and lesser, but not insignificant, question is, “How can an ordinary person of no great acuity, educated only in the most liberally scattered fields of the liberal arts, lacking in mathematical talents, and possessed of a tendency to be easily bored, figure out what the fuck economists are talking about?” How well I answered the second question is not for me to judge. But I think I did manage to find some answers to the first question, even if there is a certain “No shit, Sherlock” aspect to my conclusions. Therefore I’ve decided to leave the text of this book as it was in 1998, with its descriptions of transitory conditions making points that are permanent. Although I’ve provided a few footnotes to explain references so ancient that they’ve been consigned to the memory care unit of popular culture. Another thing I’d like to provide is an expansion on one of the points I made. Rereading the book, I find myself making a strong case for free markets. But I wish I had been making a somewhat stronger case for freedom in general. The problem was (and is) that freedom in general is difficult to quantify. I wasn’t smart enough to do that kind of math in 1998, and I’m not getting any smarter. But there’s an institution that’s been struggling with this quantification
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