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Adventures in Economics: Traveling into the Heart of the New World Order

For some reason, people don’t think of economics as one of the “cool” subjects like Archeology (thanks Indiana Jones) or Law or Philosophy (ok, maybe all academic subjects are kinda dorky). It always seemed odd to me – I mean – Economics is really the study of Money – which – as we all know, makes the world go round. Plus, money seems to have a lot to do with what we consider cool, so why wouldn’t Economics get in on that a little? But I guess it is pretty hard to imagine an Economist running around the world with a whip and a hat.

Well, I’m going to do my small part to change things – in honor of the massive shitstorm that is the current world economy, I’m introducing “Adventures in Economics”

First stop: Robert Mundell’s Villa, Santa Colomba, Italy.

You know about this stuff from Tom Clancy books and Bond movies – Men in expensive suits who control vast sums of money; shadowy international organizations with members at the highest levels of government; clandestine meetings in European Castles where the fate of the free world is determined by a select few… you know – all that completely ridiculous stuff that doesn’t happen in real life?

Well… it’s not really that far off.

I wouldn’t say that they get to decide the fate of the world, but last July, I sat in a room and listened to a bunch of ridiculously rich and powerful guys planning an international currency and a new world financial system. So yeah. Kind of like the Illuminati, right?


After the Jump – Is there a New World Order running our lives?

A little introduction – Robert Mundell is a Nobel Prize Winning economist, known as one of inventors of supply side economics, and sometimes called “The Father of the Euro”. Since the 70’s, when the gold standard broke down, he’s been holding conferences at his place outside of Siena. I ended up at the most recent one this past July…

The event was held in an Italian Villa that looked like one of those castles the Charlie’s Angels attack when thwarting an international criniminal mastermind. When I pulled up to the gate, there was a cluster of Mercedes and BMW’s parked on the lawn. I could tell this wasn’t going be a bunch of professors sitting around talking about the newest formula for calculating the Consumer Price Index.

The attendees were a collection of Finance Ministers, Rich Market Guys (Hedge Fund Managers and the like), and Academics… with a former Secretary of this or that thrown in. Now, I tend to relate to the liberal perspective on economic thinking, and these guys were most definitely of the opposite persuasion. This was a decidedly right wing affair. But still, I have an open mind, and I wanted to see what the best minds of the conservative movement had to say about the world we live in.

Topic of discussion? A new world currency. Yep – that’s right, if these guys get their way, we could have unified world currency sometime in the next decade. I don’t know – it might be kind of cool – like a sci-fi movie.

They spent a lot of time figuring out how to make it work… and by the way, this is no pipe dream. Mundell really was one of the main guys who got the Euro together, and his goal all along has been to use it as a first step towards getting rid of floating exchange rates.

However, there was one topic that was dramatically absent from the discussion: THE NAME. Come on! If you’re going to plan it, at least come up with something cool! If we don’t watch out, we’ll end up with something like the Worldo.

Just imagine payday for a second. “Hey – I just got paid three thousand Worldos. Yes. I feel like jackass.” It would ruin everything.

And Rap Lyricists would riot in the streets.

Anyway – while the currency stuff was interesting (and the topic of next week’s post), I had a more pressing issue on my mind. Given my liberal upbringing, I was inclined to think of these guys as the root of all evil… in attending this meeting, I wanted to find out if there is any truth to that assesment.

At lunch, I sat next to a well known economist who shows up on Fox Business News a from time to time. He also was there with Bush when they were negotiating the recent Nuclear Arms Deal in North Korea. We got into a conversation, and I mentioned that my father had been an economist in the Clinton administration.

He asked me if I was comfortable in enemy territory…

Hah – I thought – he’s got a sense of humor.

Then he said that I was sitting with the “Priesthood” of the Conservative movement (paraphrasing here, but he definitely used the word priesthood).

I’m thinking – there you have it – It’s all true! The Illuminati exists – the New World Order isn’t just a myth!

So I asked him – if this is a priesthood, what do you guys worship?

He laughed, then paused for a moment and said, “Well… we’re primarily concerned with the movement of the world’s money, and specifically, who has it, and what they’re doing with it.”

Aha. So there is a bunch of people who sit around and keep track of this stuff… and from the sound of the rest of the conference, they have a fair amount of control over who ends up with what.

But still – I’ve always been skeptical of anyone who believes that there is some shadow organization that controls the world. I’ve heard enough about secret alliances between corporations and political figures to know that these conspiracy theories are, for the most part, bullshit. When you meet these guys, they’re not creepily petting cats or anything (although one guy did have an eyepatch, so maybe…) For the most part, they’re pretty cool, smart people.

And you know what? None of the stuff they discussed was secret information! They issue papers and notes on the conference – they’d even probably have a website for it if someone got around to making one. No one is hiding this stuff – and it certainly wouldn’t take a double O agent to get into the party. I mean – I was there…

By the end of the conference, I had decided that no one was going to sprout horns or hooves or anything. I disgreed with some of their theories on economics, but I had to admit, they were smart, qualified, and given the amount of money in the room, they all seemed to know how the system works. You may not like the rich getting richer, but they have to be pretty smart to get themselves there in the first place.

No, the problem is not a lack of intelligence, or even a lack of compassion – it’s simply a lack of real world experience. Once you reach a certain echelon, you become delightfully removed from the everyday experience of an average person. Even if you pulled yourself up by you’re bootstraps, it’s still been quite a few years since you really felt poverty. And if your not aware of your own lack of important knowledge, your calculations start to go astray.

An economist sitting comfortably in a Mercedes has no problem assuming that everyone makes rational decisions just like he would. And if they don’t, it’s because they’re not smart enough to see the right choice, and therefore they don’t deserve to succeed.

Well, when you haven’t paid rent in a month and all you’ve got is half a box of spaghetti that has to last you a week, your decisions become a lot less rational.

If economists don’t take these things into account, I have a really hard time believing they’re decisions are going to be best for all of us. Maybe they’ll get richer for a while, but ultimately, cracks will have to appear. Economics is built on the ability to predict the decisions of the average consumer, and if the economists who are in control never talk to that guy, they’ll end up getting some serious things wrong.

So, my final conclusion is that the New World Order is not new, and it’s not particularily ordered. The rich guys on this planet do in fact get together every once in a while and talk things over, but they’re not out for world domination. Mostly, they just want to make sure they stay rich, which you can’t really blame them for. My problem is when we let those guys make decisions for everybody, because they’re not always right, and as they get farther away from the world most of us live in, those decisions get even worse…

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