Bankers can be faulted for mislending the savings of America when they make loans for speculative, non-productive activities. Politicians can be blamed for legalizing counterproductive laws. Both could not knowingly or naively justify these decapitalistic practices were it not for misunderstandings about capitalism. These misinterpretations, when not simply a result of greed, emanate from a group of college-educated people who call themselves economists.

Economists err in many ways, especially in what they call them selves and what they call economics. They define economics as the study of "production, distribution, and consumption of wealth." Is it? Are they really economists?

First of all, economics literally translates "environmental (ecos) laws (nomos)" which implies much more than mere wealth production, distribution and consumption. Implicitly, man depends upon the environment. Traditional economics mutes this dependence by picturing man as manipulator for his own ends, regardless of the environmental impact. Secondly, mere manipulation of figures or the symbols of production does not constitute knowledge of or laws of a productive environment. Most trained economists inhabit a world of numbers divorced from everyday common sense. These reasons underlie why so-called economists fail in describing and prescribing a system of production which will increase production per capita, that is, for everyone that composes the human environment.

What are most people who call themselves economists? They are intellectual lobbyists in government, academia and finance, who greedily argue for the control of the total environment by their narrow interests. In order to have ideal laws for the human environment, control should be by humans organized in a democratic fashion.

As a consequence of misdefining their subject matter--so as to benefit a fewer few--the effect of the "economists" is a dying or dead environment. Based on their effects, these so-called knowers of production, distribution and consumption should be known as "necronomists", knowers of the laws of the dying or dead. Their science is not ecos nomos, but necronomics.

Misused Capitalistic Terms*

Necronomists are able to ply their deadly advice by their loose use of terms and concepts; they are supreme at semantic slippage. All too often, the meaning of words are effectively auctioned off to the highest bidder, as if to give the words some "true" market value. This happens, for instance, when financial clout determines what constitutes capitalism, radicalism, and Americanism.

Can problems ever be solved when words are not kept to their literal meaning, when the meanings are subject to the whims of the well- fixed or well-bought? Below are a list of terms that are misused by the necronomists. Let us examine how they misuse the terms and suggest more apt terms.

Capitalists Are Not Acquisitors Or Decapitators

Many necronomists refer to their actions and to themselves as being capitalistic. Do they fulfill the semantically honest dictum that "A true capitalist capitalizes production either by expanding existing production or by creating new production"? Through either action, production per capita increases. A capitalist is not someone who gets a loan from a bank so as to "acquire" and chop-up production. This activity, praised in many financial journals, affects a decapitation of production. They confuse more symbols (stocks, bonds, currency) with a growth of actual capital--more people working, producing more.

While the acquisitor may have increased his ownership of production and may have increased productivity per his worker, his stream lining and reducing of total production makes him a "decapitator". The case of Wheelabrator-Frye dismembering Pullman was discussed in the introduction. The leading financial daily had more than one article on this instance of "capitalism.",, The head of Wheelabrator-Frye once described the various acquisitions and stream linings by his conglomerate as the orchestration of a symphony with himself being the conductor. If a counterpart could be found in the music world, would the music sooth or enrage the savage beast?

The streamlining acquisitor is not a capitalist of the whole system of production. He has depressed the level of total production and has lowered productivity per worker and per capita within the system as a whole.

Some decapitalists have gained a well-known reputation to the point that some corporations liquidate rather than allow the person to use bank loans to buy and vivisect their companies. One such person is Victor Posner who has been accused of having "taken over and looted at least eight corporations in approximately as many years." Although nominally a capitalist, Posner and his kind give capitalism a bad name as their wanton activity reduces production and increases unemployment.

On initial considerations, some of the charges against decapitalists would seem to be contrary to simple common sense, mainly, how can money be made by dismembering a corporation? The mechanics are simple if one appreciates how the stock value of many companies has been consistently underpriced compared to the book value of the assets. Assets include buildings, equipment, property, patents and accounts receivable. For an undervalued company, if all the assets were sold, the money would be greater than the value of the stocks. Stated another way, what it cost to buy the company through stock purchases is less than actual market value of the parts.

In Spring of 1982, the stock of Firestone Tire Company traded at forty percent of listed assets. Because one need only buy a con trolling interest--less than half the stocks--one could buy Firestone for only twenty percent of its assets. Thus, as Posner has done more than once, one could buy Firestone and sell off the parts so as to double one's money. What is the implication for total U.S. production, unemployment and prices as a result of vivisecting viable enterprises? The situation is somewhat analogous to how a body shop can buy a stolen car for a low price with the cut-up prices selling for more than the cost of the whole stolen car. The difference? The more harmful corporate decapitation is legal.

Not so obvious in its reduction of production and employment is the takeover of underpriced corporations by companies that desire parts of the takeover target. This more common form of production vivisection is rationalized in terms of "efficiency". Suppose Goodyear Tire company wanted to expand production and realized that the cost of the desired new plants equaled the price of buying controlling interest in Firestone. Barring an anti-trust action-- unlikely given the merger climate after the Du Pont-Conoco merger-- Goodyear could get the desired plants at no-cost! By breaking up Firestone, Goodyear could recoup its money from selling the unneeded assets, and its efficiency would no doubt increase. However, the total effect would be less production, more unemployment and higher prices. While Goodyear has not acquired Firestone with the described results, such has happened in the case of Nabisco and Standard Brands or of General Foods and Oscar Mayer.

Whether mergers or takeovers, both cause increased unemployment., Even for the dominant, initiating party, many mergers and takeovers have gone sour; examples include Exxon's acquisition of Reliance Electric, Mobil's takeover of Montgomery Wards and Pan American acquisition of National Airline. For the prospective take over target, many choose to fight; some attempt a tactic known as a "lockup" in which a friendly buyer is sought who will not break up the existing corporation.

Among the people disturbed by the effects of mergers are those who advocate the elimination of the tax-free swaps behind the decapitalism of production,, such as the $100 million savings in taxes accrued by Esmark when it sold a subsidiary. To say the least, tax support should not exist for business activities that reduce production and employment. However, the resistance to eliminating the tax benefits for corporate marriages will find resistance from the brokerage community which earns large commissions from handling the old stale stocks; in 1980, the fees totaled $750 million. The value of the traded stale stocks was $50 billion in a year while the new issues were only worth $800 million. These figures reiterate the claim that Wall Street is decapitalistic, for the com missions on old stale stocks nearly equaled the total value of fresh new stocks.

The tax support for the decapitation of the U.S. through vivisecting production extends beyond the ways already described and involves some of the divested assets. Some assets are sold here, but a lot of used factories "are being exported to developing countries." Hopefully, the vicious cycle in this sequence is obvious: The vivisection of the plant generates unemployment, that reduces demand for other products, which depresses the stock prices of the affected corporations, and thereby provides another takeover candidate for the decapitalists. Spurring the depression of domestic production and stock prices is the importation of cheap goods which are, in some cases, manufactured in used American factories. Providing funds for this sordid, decapitalistic cycle are not only American bankers but governmental agencies that insure foreign factories owned by American interests using tax-dollars. Would people readily dismember American production for foreign production if the government did not guarantee their funds?

Acquiring, streamlining, and decapitating production is necrotic to the whole system of production. In providing rationale for such activity, necronomics causes unemployment and shortage inflation (sin flation). By reducing production and consumption per capita within the whole system of production, the necronomists are not capitalists. They are decapitalists.

Profits Do Not Come From Inflationary Speculation

Among the words misused by necronomists is profit, which was previously analyzed in a limited sense. A few subtleties, once recognized, more definitively determines whether business transactions involve profits or its antithesis, inflationary returns. The Latin origin of the word "profit" is the same as proficient. Their common roots translate "forward (pro) making (facere)." Profits occur when products are being produced. Products indicate the system of production is going forward.

In repetition for reemphasis, income derived from speculation is not a profit; rather, the income constitutes inflationary returns which index a return of the system of production to a lower level of production. Inflationary returns occur when people cease directing their resources into production for production profits.

The examples in which necronomists misuse the word profit are numerous. Consider the following account.

Pan Am had a record operating loss of $60.4 million in fourth quarter. But the $294 million sale of the Pan Am Building in New York resulted in a net profit of $197 million.

Did Pan Am have a profit in the fourth quarter? Did the $197 million indicate how Pan Am had a quarter in which they went forward to a new level of production or product ownership? Or, did the money indicate how Pan Am had "returned" to a lower level of production or product ownership?

Pan Am did not have a profit anymore than the pensioner who similarly sells family heirlooms in the face of inflation. Do the aged have "profits" when they sell an heirloom to put carbohydrates in their tummies? No. Nor did Pan Am have a profit when it sold the Pan Am Building in order to put hydrocarbons in its tanks.

The misuse of the word profit is frequent. Is any of the following necronomic malapropos an indication of production going forward?

The U.S. dollar slumped against most major currencies on a wave of profit taking.

Were any new products produced during this "wave of profit taking"? No, no more than when profit taking precipitates price drops on the stock, bond, and commodity markets.

Were there any new products in the case of the following use of "profit"?

an indictment charging two former employees with profiting from inside merger information;"

Merrill Lynch profit in the fourth quarter surged 76% to $52.3 million ... E.F. Hutton said preliminary figures for the period show a 110% increase ....

No true profits occurred, for the majority of this income was derived from hustling people to divert money away from production into speculation.

A similar misuse of "profit" occurs when one describes the inflationary income which large corporations receive by having a shared or virtual monopoly, e.g., oil or cereal. Some will argue that oil and cereal companies provide a needed product and have a right to say that their earnings are "profits", even if they are steep. After all, they produce new products each day which people need to continue going forward as profit implies. Refutation of this argument requires further reasoning on what makes a business transaction a "forward making" action.

For a business transaction to produce profits in the fullest sense, all the participants must benefit in a forward, permanent sense. For instance, suppose you need some gasoline to drive to the store in order to buy seed grain for planting your fields. In the fullest sense of the word, would a profit occur if I charged you all your money for the needed gasoline? In a limited sense, both of us will have gone forward from the transaction. My wealth will have gone forward to a higher level, and you will have gone forward toward the seed store with the gasoline. However, in a fuller and more permanent sense, you did not go forward toward making your fuller goal of planting a crop.

For the sake of viable ecos nomos, the word "profit" should be used in its fullest, literal sense. Otherwise, many ultimately counterproductive business practices will be legally sanctioned. Non- profitable transactions eventually retard and regress the human environment. The above account of my price-gouging you out of your seed grain money has a parallel in the real world. The continued petroleum price-gouging of the farmer by the oil companies has squeezed many farmers to the point that they don't have seed money.

Investment And Speculation Are Not The Same.

The origin of the words investment and speculation clearly distinguishes what necronomists readily confuse. "Investment" derives from "vestments," i.e., clothing. "Speculation" comes from "spectator," i.e., voyeur. A speculator is someone who wants to declothe an investor of his production profits, to get something by producing nothing.

Speculation so as to "declothe" the producer is nowhere more apparent than in the world of conglomerates. Increasingly, conglomerates acquire industries for speculation until the industries are no longer profitable. Besides the relative unknowns like Wheelabrator and Posner, one can find many household names, e.g., Bendix, that are equated with production but which are nothing more than vivisecting decapitalists. (Bendix got its dues in its attempt to chew up Martin Marietta!)

ITT, another conglomerate, was "unmatched at buying up smaller companies ... the company never won awards for running them." In 1979 and 1980 ITT shed 34 companies that were in worse shape than when they were bought and squeezed. What do conglomerates call the process of spinning off subsidiaries that are no longer generating income? Divestiture! And, what does divestiture mean? Declothing!

There are numerous comparisons between the past and recent divestitures. Previously, only ailing firms were shucked-off, but now executives "are lopping off pieces of their companies as a way of making their shareholders richer overnight." Underpriced stocks pro vide the means and incentives for unscrupulous executives to initiate a price war for the acquisition and dismemberment of their corporate charges. Illogical settlement bonuses, for being axed as a result of a takeover, sweeten the pot and which have been appropriately called "mad money." Isn't it mad to provide even one iota of encouragement for executives not to mind the store?

Certain conglomerates and executives participate in the acquisition and vivisection of subsidiaries with only the thought of a fast buck. This income derives from inflationary speculation disrupting production and returning many people to a lower standard of living. Production is disrupted by the takeover, the mismanagement and eventual divestiture; many are discharged from employment so that a few can make a financial killing. Production declines; joblessness increases; and prices rise because of this form of decapitalism.

The necronomists behind this decapitation of production have rationalized the various shell-game shuffles involving new and resurrected financial instruments. The bank loans common to the megamergers of today were rampant in conglomeration of Germany during the early 1920's. Similarly, the tax-free stock swap revived by Esmark in 1980 was an "old gimmick" which saved Esmark $100 million in taxes and started the current merger wave. A barter tax should be enacted on corporations bartering each others stocks.

Creative financing is not new, for the same sequence of "new" home mortgages preceded the 1929 crash. Necronomists have metastasized many instances of non-productive, inflationary income for the speculators and the pod shufflers.

Capital Gains Are Not Inflationary Returns*

One of the rallying calls of the necronomists, especially the supply-siders, is that the tax-rate on capital gains should be cut. Traditionally, capital gains has been defined as nonwage, unearned income such as interest on savings or bonds or as returns on sales of stocks, bonds or commodities. Part of Reagan's National Recovery Act passed in April 1982 cut the top tax on capital gains from 70 to 50 percent. These so-called cases of "capital gain" are frequently instances of semantic slippage, since the persons receiving them did not produce more than they did before; there was no gain in capita at producing needed goods or services. And, as it turned out, the supply-side incentive rational behind the lower tax rate on "nonwage" income did not pan out, for there was no increase in actual capital investment for new production and new jobs. The promised binge of capital investment became a bust because of the economic uncertainty generated by insufficient taxation as evidenced in a ballooning deficit.

The Wall Street necronomists are not happy with Reagan's treatment of "capital gains" taxation; they want a reduction in the amount of time that possessions must be held before the sale can be treated as capital gains, from a year to six months. Will an actual gain in production/employment per capita result if people are encouraged to buy and sell stocks more frequently through tax laws? No, when people are encouraged to gamble on what the economy will do in six-months, they will go for the short-term benefits even if it means long-term decline. Furthermore, consider the items that can be bought and sold with the income being treated as capital gains: paintings and coins.

Are necronomists talking about capita gains in substance or mere symbols of substance? Will their tax gains increase production per capita? Because they do not distinguish between

creative, capitalistic production profits and acquisitive, decapitalistic inflationary returns,

the call for a tax-cut on capital gains will speed up the streamlining, contraction, recession, depression and collapse of the

American Economic System Of Production.

Schooled in the necronomists' decapitalistic rationale, politicians increasingly imbalance the use of human resources. They are making it more personally beneficial to speculate for inflationary returns rather than invest for production profits. Speculation is gambling. Productive people don't gamble unless misled by "professionals" (another misused word) and politicians. As a consequence of effectively gambling with our future, our system of production will die. Under the modern politicians, we have the laws of the dead and the dying, not ecos-nomos.

True capital gains should be taxed lower than they are. Real capital gains occur only when there is an increase in production per capita. Everyone benefits from literal capita gains: more goods, more jobs, lower prices. On the other hand, inflationary returns parading under capitalistic banners should be taxed quite high. Because of their counterproductive effect on the economy, they cause a loss of production per capita. Rather than being tax-sheltered, inflationary returns should be taxed out of existence before they destroy the existing production. People should be penalized for trying to get something-for-nothing; in a court of law it's call theft.

A Security And A Nocurity Are Not The Same.

Many necronomists refer to their scribbled-on paper products as being "securities". However, if one's purchase of a symbol of production causes negative effects to production, one has not bought a security, one has bought a nocurity. A security is "the state of being or feeling secure; freedom from fear, anxiety, danger, doubt."

Does your certificate of deposit, stocks, bonds, or Social Security bring you a sense of being "cured" for the rest of your life? No, they are not cures to the evils of old age, thus they are nocurities. Necrotic thinkers do not provide a secure life for the people about them; they have no cures for the problems of surviving.

Legal Is Not Always Logic As It Should Be.

When one hears any financial advice qualified with the expression "and it's legal", one should immediately assume that the financial advice involves the following:

necronomics, legisflation, inflationary returns, and no productive logic.

The words legal and logic have the same language root of "to collect, to gather"; these roots are synonymous with "to produce."

When corrupt and incompetent politicians are willing to establish economic privileges for a fewer few, the legal rules no longer reflect the logic of production. The logic of production is that a person should receive as much as he produces, no more and no less--the Survival Rule restated. The logic of production is corrupted when the modern politicians legalize someone getting paid more than their goods or services are worth, or, someone escaping payment for a public service they use, i.e., avoiding taxes that fund economic stability. This legalized inflation for a special few is legisflation. The rule by legal law is a joke when the logical laws of reason, survival and nature are mistranslated by corrupt politicians.

Thus, when financial advice is qualified with the expression "and it's legal," more than likely, it's not logical for a productive system of capitalism. More than likely, the counsel is necronomic rationale, that is, legal negative information: "ninformation" for short.

Ninformation fuels legisflation by corrupt and/or incompetent politicians within the law process. More than likely the advice will give you and yours more symbols of production but fewer actual pro ducts. Ninformation ratchets wealth away from you. It is advice you should avoid.

Ninformation is possible to the degree that words are not kept to their literal meaning. Semantic slippage allows greedy financial wolves to parade in the guise of capitalists who prey upon the naive producers. The meaning of words should not be auctioned off in the marketplace to the well-fixed or well-bought through monopolization of the media. Otherwise, a few will be rich for the short-term by decapitalizing the efforts of many people through abuse of the language.

If the present necrotics laws are to be repealed, old words must be cemented to their original meanings and new words must be coined to describe the changing environment, e.g., decapitalism, legisflators and necronomics. Otherwise, reputable words will slip into disreputable use for the benefit of a few----legalities.

Currency Inflation: Loss Of Product Or Production Value

Perhaps the greatest criticism of the necronomists, especially the monetary necronomists, is their limited definition of inflation as a growth of the money supply. For them, inflation merely indexes a change in the ratio of currency to the available products or production. It is true that an increase in the amount of currency without a corresponding increase in products or production will cause currency inflation. The product or production worth of the units of currency will be less. However, and more to the truth in reality, currency inflation can occur from a drop in product or production availability.

As production goes down, the product worth of currency decreases. Consequently, necronomists do not emphasize that where currency

circulates today determines its product value tomorrow.

While they may have a quantitative index called the "velocity of circulation", the necronomic monetarists ignore where the money is circulating. Where the various quantities of money circulate deter mines the "product quality" of the money.

If money does not circulate among producers, the product quality of the money would drop. In other words, inflation would occur where production was hampered by cash flow problems. Inflation of product prices and unemployment would be greatest in those products suffering a loss of local velocity of circulation.

Main Street suffers when Wall Street draws money out of local circulation for use in stock, bond or money fund speculation. A good example of this principle and the naivete is Houston, Missouri. In a process best described as "currency dislocation", the local financial institutions of this small town have been shipping the local savings to regional and national banks. On the positive side, the financiers received a slight gain in earnings. But, the community has a 16% unemployment rate because local business cannot pay the high interest that is offered by distant borrowers.

Curflation--cheapening of currency--could occur with a decrease in the money supply if people hoarded money or if all the money was lent to gamblers, speculators or acquisitors by the bankers. What good is it if brokers and bankers are able to offer cheaper services if their improved service efficiency comes at the expense of product productivity? As with the fabled hare, you'll have a fast buck but never finish the race. Would you rather have cheaper banking service or cheaper food and housing? Better to be a tortoise with a steady job, secure home and sufficient food.

Where you put your money determines what products will be produced and determines where inflation or deflation in prices will occur. Funding bankers and brokers may generate a deflation in the prices of their services. However, is cheaper full-service banking worth the inflationary price rises in other goods and services?

The necronomists do not appreciate how the use of money today affects the value of money tomorrow. They do not ask the questions:

What Products? What Production? What Producers?

Nor do they analyze all their statistics on business activity, business loans and capital investment in terms of the question:

Of course we're busy, but what are we busy at?

Consequently, their statistical data frequently show a booming economy when such is not the case. Their data index a cancerous bloating of the less essential businesses which are cannibalizing the essential production.

The following statistics indicate a growth in the economy if one merely equates dollars with growth:

Personal income rose an adjusted 0.6 % in November as
service-industry salary increase more than offset declines in
manufacturing payrolls.

The gist of this statistic is more inflation: a rise in the total availability of money while production (manufacturing) is falling. Correlated with this shift toward services away from manufacture is how in each on-going recession decline was most obvious in the record blue-collar unemployment., The figures on rising blue-collar unemployment indicates future sinflation due to reduced manufacturing and burgeoning trade deficits.

An even more disturbing statistic on personal income was reported a half-year later. The increased income was ascribed to bigger pension and unemployment checks due to Cost of Living Adjustments. Future inflation can be expected, since the amount of money in the economy rose without a corresponding rise in production; there is no production behind income derived from COLA.

Another statistic that some economists cite as evidence for an improving economy is a rise in business loan demand. The reasoning is that business is going to expand production. But, what if the loans are stress loans for keeping an ailing company afloat, since "money buys time" even at high interest rates. The same phenomenon seems to be occurring in the area of many private companies going public with stock issues. Savings and loan institutions can be cited which sold stock in order to acquire badly needed cash. But, yet, the transaction of public issues have been portrayed in favorable light more so than being described as a dangerous situation.

This growing carcinomic imbalance cannot go on. The lop-sided growth within the body of our economy reveals itself in bulging symbolic enterprises--stocks. Our imbalanced civilization will teeter- over and collapse.

No Sense Of Time

Necronomists developed their vapid, fetid, fecal calamity by losing their sense of time. They forgot and ignored (or never knew) how the word and concept of currency developed: One received compensation for what one was "currently" worth, what one's production TIME was worth. Consequently, they never have established a public or private "currency" kept constant and current in its production time worth. The inflation or cheapening of currency is a loss of how much production time one can buy with the currency. When a dollar will buy only half as much as it used to, timistically*, the dollar will only buy half as much production time.

Currency instability results from divorcing the symbols of production from production itself. Currency is supposed to symbolize production time. With currency one can buy directly or indirectly another person's production time in producing a good or service. Currency is the

common, intermediate product
by which producers exchange their production time. Currency is not wealth--its use is or is not wealth.

Currency instability destabilizes business activity in many ways. Unfair and unfree exchanges of production time occurs when the handlers of currency are over-compensated. The greater the currency instability, the greater the opportunities to exploit the instability for inflationary/deflationary returns. These fast buck opportunities lure people from production time profits to non-productive income which returns the economy to a lower level of production. Thus, the system of production is necrosed; the cities become necropolises; and the roots of the decline are in necronomics.

As the system of production returns to a lower level of production, less and less time is spent producing the essential goods and services on which the essence of human survival depends. Human time--life--depends on essential goods and services. The growth of inflationary returns within the handling of the symbols of production metastasizes a cannibalization and collapse of the essential support systems. As a result, the system begins to run out of production time. Axiomatically, it runs out of the essential products that are the timistic commodities of life.



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