My Theory on How Wealth and Prosperity are Created: or How These Concepts Have Come About and Come to be Understood

2010 August 15

by Roy W. Bakos

Earlier this year, my friend, Jego, asked a few of us to ponder the creation of both wealth and prosperity.  I was going to go into the standard history-based assumptions with some quotes from the ancients to Adam Smith and Marx and some modern economists as well but then the question of what exactly do these two words mean came into my head; fucking up my previous thesis and creating a new dilemma for discussion.

wealth
Pronunciation: \ˈwelth also ˈweltth\
Function: noun
Etymology: Middle English welthe, from wele weal
Date: 13th century
1 obsolete : weal, welfare
2 : abundance of valuable material possessions or resources
3 : abundant supply : profusion
4 a : all property that has a money value or an exchangeable value b : all material objects that have economic utility; especially : the stock of useful goods having economic value in existence at any one time <national wealth>
pros·per·i·ty
Pronunciation: \prä-ˈsper-ə-tē\
Function: noun
Date: 13th century
: the condition of being successful or thriving; especially : economic well-being

So, the very idea of the word wealth has to do primarily with an abundant supply of something.  In our economic system I guess that something would be broken down into either resources, land, or money or it could also mean having an abundant supply of some other desirable thing like knowledge or power.  All of these things, while seeming tangible, are really intangible and their value is subject to the people or society or situation that measures them.  Having five gallons of water in a desert would make you wealthy wile having that same five gallons of water in a monsoon would make you only wetter.  Ideas are intangible, money is intangible, hell even gold and real-estate are intangible at their core in that there is no fixed value on anything outside of the system in which it exists.  This leads me to believe that the “stuff” that
makes one, or the overall society in which one lives, “wealthy” is not created but just is as matter is in the discussion of science.  It is the measure, or value of this “stuff” that is created and this is where the question starts to get dicey.

I will posit that the idea of “value” has only changed slightly since we went from cave-dwellers, to farmers, to citizens of a “state” in the course of our economic and political evolution throughout history.  In the beginning, the things that had “value” were the things that kept you alive: the ability to hunt, to make fire, to defend yourself from other hominids and the harshness of the human condition and the elements of nature as such.  As we moved from caves into early agrarian societies, these things of value expanded to include the ability to grow and cultivate plants and the ability to trade the surplus of goods that you grew for other “stuff” that you needed and liked.  Again, this grew as we moved into becoming “citizens” of a “state” and we began to codify rules and laws for the citizenry to live by.

It is here that I have become very idealistic when I use the word “we” when I should really begin to use the words “the powerful” or “the rulers” or  “the leaders” or something more in that vein of understanding.  The idea of “we” (meaning the majority of the people) having control over any of this is very new in the history of human beings (in fact, I would argue, that the idea of using the word we to describe all of humanity in general is also a very new thing, perhaps only coming into use in this type of meaning within the last 50 or so years).  The facts seem to be that those in power in a given society create and control wealth by being the ones to define exactly what it is that has value and exactly what that value is.  Usually, the things that are deemed to have value are the things that are mostly possessed by the ruling class and the entire economic system (Capitalist, Marxist, Colonialist, Mercantililist, et.al.) is then set up to ensure that the value of the stuff of the rulers is kept scarce (and valuable in its scarcity) and in the control of the ruling class.  The bit of the stuff that is then given over to the rest of the people is fought for and keeps the rest of us preoccupied with its acquisition.  Exactly how this is done differs by the given system (Mercantilism=resources and gold; Capitalism expands this with the addition of money, etc.) but the result is that the powerful stay that way unless thrusted out by calamity or force.

As for prosperity…this it seems is usually just an offshoot of the measure of one’s individual wealth based on the system in which one lives.  National wealth and prosperity are generated by policies that give nations the ability to control the “stuff” that makes the wealthy and to define that stuff as a measure of prosperity so that the idea of wealth can perpetuate the control of the system by those that control the wealth.

I have often toyed with the idea that Capitalism (at least the way Smith understood it and we are taught it with free-markets and the like) is and has been dead at least since the first half of the 20th Century.  I still challenge anyone to name me a market that is really free (outside of the black market or some small things on a very localized level) and not completely manipulated.  This thinking about the very definition of wealth and prosperity has led me to further questions about what the next system will look like and how it will measure wealth and exactly who will decide how the “stuff” that makes one wealthy is defined.  Also, the central question of wealthy versus poor (meaning possessing less of the “stuff” that makes one wealthy) and the seeming disparity of and concentration of wealth in the hands of the few can be resolved peacefully or ever.  Must there be poor in order for their to be rich in a world where we no have the technology to make everything that was once scarce not so scarce anymore and where we have the ability to house and feed every human being if we wanted to?  These are the questions that should be answered as we look to replace or improve upon the system that we have now.

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