Sunday, January 13, 2013

The Starving Goat Returns His Rental Car Unwashed...

And With a Dead Battery

The Goat Owned in Common Always Starves - African Proverb  (Google Books)

“Money and Property are both social constructs of the Market, which are not natural but rather invented, Redistribution is just a refinement of the model to make it more efficient, it does not make the market less efficient any more than grounding makes an electric circuit less efficient.”

Welcome to the Logical Fallacy known as “False Analogy”!

Let's ignore the fact that Money and Property are both at their root not social constructs but rather expressions of our instinctive drive and desire for self-determination and survival, and instead focus on the "electrical circuit" analogy.  Despite the Keynesians’ claims to the contrary, even at the macroeconomic aggregate scale Redistribution is not at all like the proper grounding of an electric circuit.  It's like a short-circuit. Mr. Kling would have been far more accurate if he’d used an electrical circuit analogy that is contrary to his economic theories (thus the reason he didn’t), but let’s look at it nonetheless.

In a properly grounded electrical system wherein the ground completes the circuit, the ground is designed to occur post-load, i.e. post-work, and allows for a considerable financial expenditure on infrastructure to be avoided by having the planet function as the “return” leg of the power distribution network. 

Since at least in America we’re talking about  “alternating current”, I realize that “return” isn’t the proper term, but bear with me – it remains true that the circuit is *completed* by the grounding.   Mr. Kling compares money as it flows through an economy to electrical power flowing through an electrical circuit.  Fair enough, as far as that goes. In fact it can be a very good, very exacting analogy provided you keep a few truths in mind:
1)      Grounding dissipates charge
2)      No work is done, no load is added to the system, from the point of grounding back to the distribution center or generator
3)      Most modern systems are intentionally built to automatically ground if they short out, as a safety mechanism. This not only attempts to take the charge off of the faulty system to ground, but also trips the circuit if it is properly protected
4)      A system which grounds prior to the load, i.e. prior to the point(s) where the work that the system performs is done, is a short-circuited system.
5)      A short-circuit can be far more dangerous than a simple interrupt, and in an system that’s not protected by a circuit breaker (which causes an interrupt) a short circuit will almost always lead to an overload, catastrophic failure (like an electrical fire), and eventually an interrupt.

So very broadly speaking, you basically have two main types of failure in electrical systems, which all boils down to just one type of resulting failure: The Interrupt. 

To paraphrase Tina Turner, we can do this easy, or we can do this rough. 

Easy” is a simple interrupt – something in the circuit breaks, and presto! You no longer have a circuit. The system halts. 

Rough” is a short circuit, or to put it in terms Mr. Arnold Kling can understand even though he apparently doesn’t agree (with Reality), a “Redistribution" of energy which bypasses the work it was intended to do, overloading the system, and causing it to catastrophically fail – with the overload situation itself only ending when it creates its own interrupt.

Redistribution does not “refine the model” – it is a great big red line drawn with a permanent marker across the system blueprints, near the leads.

To put this in terms a General Motors Automotive Engineer would understand: Dude, that would brick your Volt!

Redistribution does not make the system “more efficient”, it makes it its efficiency mathematically undefined, or to put it another way, it will eventually make the system infinitely inefficient because once the no-work-performing overload has finished, and the calm quiet peaceful interrupt has set in, you will have created a “divided by zero” situation as far as efficiency calculations are concerned.

Follow the Money

If we were to really "refine our model", then we should properly be talking about a "partially shorted" system.  After all, not ALL of our tax money is being Redistributed...  And besides, everyone needs to understand that any analogy will break if you examine it too closely.  For example, there is no energy transformation system the output of which exceeds the input.  The "electrical system" analogy can only speak so far regarding an economic system that spends more money than it takes in, year after year after year. 

So we have a partially shorted system that magically diverts only part of its incoming "power", yet whose combined losses (proper load loss plus short-to-ground loss) exceeds its supplied amps. That strikes me as somewhat both unstable and unsustainable.

Speaking of debt, as of a few minutes ago, the portion of the US public debt that is subject to the “Debt Limit” was 16 Trillion, 394+ Billion dollars

However, at that same moment the US National Debt stood at $16,448,141,671,926 – which it has long surpassed by now – putting us not only further in the hole and falling like a rocket-propelled rock, but also, not that it apparently matters to our government in the slightest, $28 Billion, 123 Million, 597 Thousand, and 485 dollars in breach of that legal limit.  And that’s just the part of our national debts our government and their subservient press will readily admit to. 

There’s also the little matter of “Unfunded Liabilities”, which thirty minutes ago were just slightly higher than 122 OMG Trillion, NFW Billions, Enough to Make A Grown Man Break Down and Cry Millions, More Than My House Is Worth Thousands, and I Only Wish I Had That Much In My Checking Account At The Moment Hundreds of dollars.

So is there a plus side?  Who benefits from a partially shorted system going straight into the ground? 

As far as I can tell, it’s just the fire ants, and maybe the worms.

For in the end, the Starving Goat doesn't even make it to the rental return.

He succumbs on the highway, slumped behind the wheel, and is dead prior to impact.

I ended up pretty much ignoring my initial thesis for this article, so if you're still interested, and not too confused, please check out the following column, which does a better job than I would have of explaining my originally intended point:


  1. Excellent lessons, professor Hunter!

  2. Thanks! I just got some editing advice from someone I really trust, so if you're reading this and the Google Books link is still at the very bottom, please be aware I'm about move it up to near the top, before the break.

  3. Not bad. And by this analogy, the Declaration of Independence was a Ground Fault Circuit Interrupter (GFCI) so that no more electricity (money and property) would flow away from productive devices and into the earth.

    And the Constitution is a National Electric Code to specify how to build circuits so as to reduce the risk of faults. And like the code, it only works if people pay attention to it.

  4. It gets even more fun when you consider things like, say, laptops or tablets as electrical circuits, where "ground" is only the return to the battery, a return which must exist and function even when the device has no connection to the planet or it's "ground". In any case, for any semiconductor in such a device, it is imperative that all current flow between the power rail and "ground" be minimized and that the only cause for such power to flow is the actions necessary for the device to perform its function. Adding extra "grounds" to "redistribute" the power sucks the battery dry in a hurry. I'm sure Mr. Kling wouldn't mind a few extra redistributive "grounds" helping the "efficiency" of his iPhone, to "efficiently" drain the battery in a hour of idle standby ...

  5. Incidentally, this works great for Keynesianism too -- the iPhone's "economy" would surely be improved if, given the large Aggregate Supply of power in the battery, the Aggregate Demand placed upon it were increased. Push Aggregate Demand enough and it'll surely need a bigger battery -- i.e. a bigger "economy". See how wonderful that was?

  6. But what happens when you stick a fork in the outlet? I always wanted to know what happens when you do that.

    1. Although experts disagree about the number of vowels involved, or whether it should end in a double consonant, I do believe the most commonly accepted spelling is "BZAP!"