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In an influential 1932 essay, Lionel Robbins defined economics as “the science which studies human behavior as a relationship between ends and scarce means which have alternative uses.” (from Wikipedia)

I read a fascinating article about our current economic “woes” and it turns out fear is more of a factor than short supply. Simply because we desire them more they become more “scarce” causing the price to rise exponentially.

Congress and the White House have tried to help out our economy by giving creating an economic stimulus package that should hit most of our bank accounts within the next week. This was hardly the correct solution as our problems were created, in part at least,.by an economy that went from a traditional supply and demand model to one of scarcity. There has been quite a bit of fighting between the parties and the branches in an attempt to play the blame game. This year is charged with politics and I can see both sides using any fodder available to put their party into a more favorable light.

Gas prices have risen greatly in the past year because we have placed an increasing amount of desire for the fuel to keep our lives normal. We have placed a priority on fuel and as such we’ve seen the prices rise through the roof. Supply has dropped by a small amount but speculation has lead to dramatic price increases. I wrote about somebody talking about the futures market a few months ago talking about the rising price of oil - he couldn’t see the logic in the market. I don’t think there was any logic - we’re seeing a market that is being driven by fear. Fear is anything but rational. It is a reactionary impulse that causes us to hoard and make quick judgments. We fail to completely think through the problem.

The media fails to help our situation as they feed us with line after line of diatribe causing us to grow increasingly more paranoid about the situation. Its a shame that there little wrong to begin with. A state news organization is not the correct direction to head but we should ask more from the media. Sure, they’re in a business and they’re going to try and drive a profitable and addictive story that will keep readers and listeners coming back, but, they’ve got to show a little more responsibility.

Yes, there are more factors involved than a scarcity economy and yes - this is part socialism and economics but its probably the root of current ill. It’s a shame there isn’t much we can do about it.

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