Consider keeping Bernanke, top Romney adviser says
Professor Glenn Hubbard Dean of Columbia Business School poses for a portrait at Columbia University in New York August 21, 2012.
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#1 Aug 21, 2012
Post-Science Economics (PSE)
Based on Non-Violable Laws of Nature and Orderly Transition to Full Employment
Post-science extends the concept of non-violable laws of nature in science, such as gravitation, from science to social science to form a new post-science economics. The two most important examples of non-violable laws in economics are (1) The Quantity Theory of Money PQ = VM (Price x Quantity = Velocity of Circulation of Money x Money Supply) and (2) The solution of value (Quantitative Supply and Demand Model Based on the Infinite Spreadsheet). These laws are more stringent than man-made laws.
The equation PQ = VM describes how to stabilize the economy (roughly represented by PQ) by changing V and/or M. The equation is also known as the Fisher Identity, indicating that it could be considered an identity and, thus, is a non-violable law of nature. The solution of value is based on the problem posed by Kenneth Arrow and Gerard Debreu in Debreus book Theory of Value and produces a quantitative solution of the price, replacing the qualitative utility. The Infinite Spreadsheet establishes a rigorous mathematical relationship between the price and the rate of return in a time space extending to infinity. The Infinite Spreadsheet is accepted based on mathematical rigor. Post-science economics is beyond science and is based on mathematical rigor, not just empirical verification, which is the rigor of science and is no longer possible when the calculation is taken to infinity in time, such as for the price.
Full employment should be one of the major goals of the economy because full employment will increase both V and M and money is more valuable in the hands of the poor than that of the rich. The incorrectly generated Q with P will not only create inflation, but also cause financial crises, such as the Savings and Loan Crisis and the Subprime Woe, both of which are caused by the incorrect Q with P, namely, the overproduction and the overvaluation of real estates. The correct allocation of resources, such as real estate construction, depends on the determination of the price by the solution of value.
The most important sector of resource allocation is that of the available jobs. As technology progresses, machines gradually take over human labors or employment. Post-science economics proposes a policy of orderly transition to full employment, as the available work for people decreases. The available employment depends on the amount of Q, where P satisfies justifiable rate of return. With 21th century technology, most advanced nations should be able to provide the basic needs of food, clothing, shelter, transportation, and health care for all their citizens. Providing the basic needs for all the citizens can be achieved by full employment through the orderly distribution of the available employment among all the citizens. Full employment can be created by shortening the weekly working hours by regions and sectors. This full-employment policy will reduce economic inequality and eliminate excessive greed.
From a long-term point of view, the reduction of working hour is inevitable when machines gradually take over human labors. Today, most people are working on jobs which will someday be done by robots. As leisure time increases, innovation time will also increase. The full-employment economy might lower the average earning of employees, but will encourage people to be innovators rather than be innovators employees. The net result of switching to a full-employment economy will be an increase in innovations and in the wealth of the nation as a whole because there will be more innovators, who, in turn, will produce more jobs. Market Surveyed Rate of Return for Q: Real Estate: 10%+/- 5%; Small Business: 40%+/- 10%; Real Estate Development: 100%+/- 50%; Stocks: 10%+/- 5% Mars Exploration: 0%+/- 10%.
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