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Europe faces the prospect of Russia throttling the flow of piped gas. Even in the absence of a cut-off, it was expected to spend $1trn on energy in 2022, twice as much as in 2019.

Russia would also suffer heavy sanctions. Its banks would be harshly penalised and its economy deprived of crucial American high-tech components.

Perhaps, then, he will start with a less ambitious invasion. However, a limited war could claim many lives and be hard to contain.

Perhaps Mr Putin is planning a full-scale invasion, with Russian forces thrusting deep into Ukraine to seize the capital, Kyiv, and overthrow the government. Or he may seek to annex more territory in eastern Ukraine, carving out a corridor linking Russia with Crimea, the Ukrainian peninsula Mr Putin grabbed in 2014. Then again, he may want a small war, in which Russia “saves” Kremlin-backed separatists in Donbas, an eastern region of Ukraine, from supposed Ukrainian atrocities—and, at the same time, degrades Ukraine’s armed forces.

The global order has long been buttressed by the norm that countries do not redraw other countries’ borders by force of arms. When Iraq seized Kuwait in 1990 an international coalition led by America kicked it out.

if he seizes a bigger slice of Ukraine, it is hard to see him suddenly concluding that the time has come to make peace with NATO.

More likely, he would push on, helped by the newly established presence of Russian troops in Belarus to probe NATO’s collective-security pact, under which an attack on one member is an attack on all.

Not only would he relish the chance to hollow out America’s commitments to Europe, but he has also come to rely on demonising an enemy abroad to justify his harsh rule at home.

Meanwhile, diplomats should keep talking, looking for common ground on, say, arms control and pressing for a face-saving climbdown that Mr Putin and his captive media would be free to spin however they wish.

Yet the institutions and forces that once kept us from indulging the flagrantly untrue or absurd—media, academia, government, corporate America, professional associations, respectable opinion in the aggregate—have enabled and encouraged every species of fantasy over the past few decades.

Our whole social environment and each of its overlapping parts—cultural, religious, political, intellectual, psychological—have become conducive to spectacular fallacy and truthiness and make-believe. There are many slippery slopes, leading in various directions to other exciting nonsense. During the past several decades, those naturally slippery slopes have been turned into a colossal and permanent complex of interconnected, crisscrossing bobsled tracks, which Donald Trump slid down right into the White House.

Esalen is a mother church of a new American religion for people who think they don’t like churches or religions but who still want to believe in the supernatural. The institute wholly reinvented psychology, medicine, and philosophy, driven by a suspicion of science and reason and an embrace of magical thinking

The great unbalancing and descent into full Fantasyland was the product of two momentous changes. The first was a profound shift in thinking that swelled up in the ’60s; since then, Americans have had a new rule written into their mental operating systems: Do your own thing, find your own reality, it’s all relative.

The second change was the onset of the new era of information. Digital technology empowers real-seeming fictions of the ideological and religious and scientific kinds. Among the web’s 1 billion sites, believers in anything and everything can find thousands of fellow fantasists, with collages of facts and “facts” to support them

Today, each of us is freer than ever to custom-make reality, to believe whatever and pretend to be whoever we wish. Which makes all the lines between actual and fictional blur and disappear more easily. Truth in general becomes flexible, personal, subjective. And we like this new ultra-freedom, insist on it, even as we fear and loathe the ways so many of our wrongheaded fellow Americans use it.

we are the global crucible and epicenter. We invented the fantasy-industrial complex; almost nowhere outside poor or otherwise miserable countries are flamboyant supernatural beliefs so central to the identities of so many people.

We’re still rich and free, still more influential and powerful than any other nation, practically a synonym for developed country. But our drift toward credulity, toward doing our own thing, toward denying facts and having an altogether uncertain grip on reality, has overwhelmed our other exceptional national traits and turned us into a less developed country.

For most of our history, the impulses existed in a rough balance, a dynamic equilibrium between fantasy and reality, mania and moderation, credulity and skepticism.

It was a headquarters for a new religion of no religion, and for “science” containing next to no science. The idea was to be radically tolerant of therapeutic approaches and understandings of reality, especially if they came from Asian traditions or from American Indian or other shamanistic traditions. Invisible energies, past lives, astral projection, whatever—the more exotic and wondrous and unfalsifiable, the better.

These influential critiques helped make popular and respectable the idea that much of science is a sinister scheme concocted by a despotic conspiracy to oppress people. Mental illness, both Szasz and Laing said, is “a theory not a fact.”

The Greening of America may have been the mainstream’s single greatest act of pandering to the vanity and self-righteousness of the new youth. Its underlying theoretical scheme was simple and perfectly pitched to flatter young readers: There are three types of American “consciousness,” each of which “makes up an individual’s perception of reality … his ‘head,’ his way of life.” Consciousness I people were old-fashioned, self-reliant individualists rendered obsolete by the new “Corporate State”—essentially, your grandparents. Consciousness IIs were the fearful and conformist organization men and women whose rationalism was a tyrannizing trap laid by the Corporate State—your parents.

And then there was Consciousness III, which had “made its first appearance among the youth of America,” “spreading rapidly among wider and wider segments of youth, and by degrees to older people.” If you opposed the Vietnam War and dressed down and smoked pot, you were almost certainly a III. Simply by being young and casual and undisciplined, you were ushering in a new utopia.

Reich was half-right. An epochal change in American thinking was under way and “not, as far as anybody knows, reversible … There is no returning to an earlier consciousness.” His wishful error was believing that once the tidal surge of new sensibility brought down the flood walls, the waters would flow in only one direction, carving out a peaceful, cooperative, groovy new continental utopia, hearts and minds changed like his, all of America Berkeleyized and Vermontified. Instead, Consciousness III was just one early iteration of the anything-goes, post-reason, post-factual America enabled by the tsunami.

During the ’60s, large swaths of academia made a turn away from reason and rationalism as they’d been understood. Many of the pioneers were thoughtful, their work fine antidotes to postwar complacency. The problem was the nature and extent of their influence at that particular time, when all premises and paradigms seemed up for grabs. That is, they inspired half-baked and perverse followers in the academy, whose arguments filtered out into the world at large: All approximations of truth, science as much as any fable or religion, are mere stories devised to serve people’s needs or interests. Reality itself is a purely social construction, a tableau of useful or wishful myths that members of a society or tribe have been persuaded to believe. The borders between fiction and nonfiction are permeable, maybe nonexistent.

The delusions of the insane, superstitions, and magical thinking? Any of those may be as legitimate as the supposed truths contrived by Western reason and science. The takeaway: Believe whatever you want, because pretty much everything is equally true and false.

over in sociology, in 1966 a pair of professors published The Social Construction of Reality, one of the most influential works in their field. Not only were sanity and insanity and scientific truth somewhat dubious concoctions by elites, Peter Berger and Thomas Luckmann explained—so was everything else. The rulers of any tribe or society do not just dictate customs and laws; they are the masters of everyone’s perceptions, defining reality itself

Over in anthropology, where the exotic magical beliefs of traditional cultures were a main subject, the new paradigm took over completely—don’t judge, don’t disbelieve, don’t point your professorial finger.

then isn’t everyone able—no, isn’t everyone obliged—to construct their own reality? The book was timed perfectly to become a foundational text in academia and beyond.

To create the all-encompassing stage sets that everyone inhabits, rulers first use crude mythology, then more elaborate religion, and finally the “extreme step” of modern science. “Reality”? “Knowledge”? “If we were going to be meticulous,” Berger and Luckmann wrote, “we would put quotation marks around the two aforementioned terms every time we used them.” “What is ‘real’ to a Tibetan monk may not be ‘real’ to an American businessman.”

In the ’60s, anthropology decided that oracles, diviners, incantations, and magical objects should be not just respected, but considered equivalent to reason and science. If all understandings of reality are socially constructed, those of Kalabari tribesmen in Nigeria are no more arbitrary or faith-based than those of college professors.

Even the social critic Paul Goodman, beloved by young leftists in the ’60s, was flabbergasted by his own students by 1969. “There was no knowledge,” he wrote, “only the sociology of knowledge. They had so well learned that … research is subsidized and conducted for the benefit of the ruling class that they did not believe there was such a thing as simple truth.”

Ever since, the American right has insistently decried the spread of relativism, the idea that nothing is any more correct or true than anything else. Conservatives hated how relativism undercut various venerable and comfortable ruling ideas—certain notions of entitlement (according to race and gender) and aesthetic beauty and metaphysical and moral certaint

Conservatives are correct that the anything-goes relativism of college campuses wasn’t sequestered there, but when it flowed out across America it helped enable extreme Christianities and lunacies on the right—gun-rights hysteria, black-helicopter conspiracism, climate-change denial, and more.

Elaborate paranoia was an established tic of the Bircherite far right, but the left needed a little time to catch up. In 1964, a left-wing American writer published the first book about a JFK conspiracy, claiming that a Texas oilman had been the mastermind, and soon many books were arguing that the official government inquiry had ignored the hidden conspiracies.

Conspiracy became the high-end Hollywood dramatic premise—Chinatown, The Conversation, The Parallax View, and Three Days of the Condor came out in the same two-year period. Of course, real life made such stories plausible. The infiltration by the FBI and intelligence agencies of left-wing groups was then being revealed, and the Watergate break-in and its cover-up were an actual criminal conspiracy. Within a few decades, the belief that a web of villainous elites was covertly seeking to impose a malevolent global regime made its way from the lunatic right to the mainstream.

t more and more people on both sides would come to believe that an extraordinarily powerful cabal—international organizations and think tanks and big businesses and politicians—secretly ran America.

Each camp, conspiracists on the right and on the left, was ostensibly the enemy of the other, but they began operating as de facto allies. Relativist professors enabled science-denying Christians, and the antipsychiatry craze in the ’60s appealed simultaneously to left-wingers and libertarians (as well as to Scientologists). Conspiracy theories were more of a modern right-wing habit before people on the left signed on. However, the belief that the federal government had secret plans to open detention camps for dissidents sprouted in the ’70s on the paranoid left before it became a fixture on the right.

Extreme religious and quasi-religious beliefs and practices, Christian and New Age and otherwise, didn’t subside, but grew and thrived—and came to seem unexceptional.

Until we’d passed through the ’60s and half of the ’70s, I’m pretty sure we wouldn’t have given the presidency to some dude, especially a born-again Christian, who said he’d recently seen a huge, color-shifting, luminescent UFO hovering near him.

Starting in the ’80s, loving America and making money and having a family were no longer unfashionable.The sense of cultural and political upheaval and chaos dissipated—which lulled us into ignoring all the ways that everything had changed, that Fantasyland was now scaling and spreading and becoming the new normal. What had seemed strange and amazing in 1967 or 1972 became normal and ubiquitous.

For most of the 20th century, national news media had felt obliged to pursue and present some rough approximation of the truth rather than to promote a truth, let alone fictions. With the elimination of the Fairness Doctrine, a new American laissez-faire had been officially declared. If lots more incorrect and preposterous assertions circulated in our mass media, that was a price of freedom. If splenetic commentators could now, as never before, keep believers perpetually riled up and feeling the excitement of being in a mob, so be it.

Relativism became entrenched in academia—tenured, you could say

as he wrote in 1986, “the secret of theory”—this whole intellectual realm now called itself simply “theory”—“is that truth does not exist.”

After the ’60s, truth was relative, criticizing was equal to victimizing, individual liberty became absolute, and everyone was permitted to believe or disbelieve whatever they wished. The distinction between opinion and fact was crumbling on many fronts.

America didn’t seem as weird and crazy as it had around 1970. But that’s because Americans had stopped noticing the weirdness and craziness. We had defined every sort of deviancy down. And as the cultural critic Neil Postman put it in his 1985 jeremiad about how TV was replacing meaningful public discourse with entertainment, we were in the process of amusing ourselves to death.

In 1998, as soon as we learned that President Bill Clinton had been fellated by an intern in the West Wing, his popularity spiked. Which was baffling only to those who still thought of politics as an autonomous realm, existing apart from entertainment

Just before the Clintons arrived in Washington, the right had managed to do away with the federal Fairness Doctrine, which had been enacted to keep radio and TV shows from being ideologically one-sided. Until then, big-time conservative opinion media had consisted of two magazines, William F. Buckley Jr.’s biweekly National Review and the monthly American Spectator, both with small circulations. But absent a Fairness Doctrine, Rush Limbaugh’s national right-wing radio show, launched in 1988, was free to thrive, and others promptly appeared.

I’m pretty certain that the unprecedented surge of UFO reports in the ’70s was not evidence of extraterrestrials’ increasing presence but a symptom of Americans’ credulity and magical thinking suddenly unloosed. We wanted to believe in extraterrestrials, so we did.

Limbaugh’s virtuosic three hours of daily talk started bringing a sociopolitical alternate reality to a huge national audience. Instead of relying on an occasional magazine or newsletter to confirm your gnarly view of the world, now you had talk radio drilling it into your head for hours every day.

Fox News brought the Limbaughvian talk-radio version of the world to national TV, offering viewers an unending and immersive propaganda experience of a kind that had never existed before.

Over the course of the century, electronic mass media had come to serve an important democratic function: presenting Americans with a single shared set of facts. Now TV and radio were enabling a reversion to the narrower, factional, partisan discourse that had been normal in America’s earlier centuries.

there was also the internet, which eventually would have mooted the Fairness Doctrine anyhow. In 1994, the first modern spam message was sent, visible to everyone on Usenet: global alert for all: jesus is coming soon. Over the next year or two, the masses learned of the World Wide Web. The tinder had been gathered and stacked since the ’60s, and now the match was lit and thrown

After the ’60s and ’70s happened as they happened, the internet may have broken America’s dynamic balance between rational thinking and magical thinking for good.

Before the web, cockamamy ideas and outright falsehoods could not spread nearly as fast or as widely, so it was much easier for reason and reasonableness to prevail. Before the web, institutionalizing any one alternate reality required the long, hard work of hundreds of full-time militants. In the digital age, however, every tribe and fiefdom and principality and region of Fantasyland—every screwball with a computer and an internet connection—suddenly had an unprecedented way to instruct and rile up and mobilize believers

Why did Senator Daniel Patrick Moynihan begin remarking frequently during the ’80s and ’90s that people were entitled to their own opinions but not to their own facts? Because until then, that had not been necessary to say

Reason remains free to combat unreason, but the internet entitles and equips all the proponents of unreason and error to a previously unimaginable degree. Particularly for a people with our history and propensities, the downside of the internet seems at least as profound as the upside.

On the internet, the prominence granted to any factual assertion or belief or theory depends on the preferences of billions of individual searchers. Each click on a link is effectively a vote pushing that version of the truth toward the top of the pile of results.

Exciting falsehoods tend to do well in the perpetual referenda, and become self-validating. A search for almost any “alternative” theory or belief seems to generate more links to true believers’ pages and sites than to legitimate or skeptical ones, and those tend to dominate the first few pages of result

If more and more of a political party’s members hold more and more extreme and extravagantly supernatural beliefs, doesn’t it make sense that the party will be more and more open to make-believe in its politics?

an individual who enters the communications system pursuing one interest soon becomes aware of stigmatized material on a broad range of subjects. As a result, those who come across one form of stigmatized knowledge will learn of others, in connections that imply that stigmatized knowledge is a unified domain, an alternative worldview, rather than a collection of unrelated ideas.

Academic research shows that religious and supernatural thinking leads people to believe that almost no big life events are accidental or random. As the authors of some recent cognitive-science studies at Yale put it, “Individuals’ explicit religious and paranormal beliefs” are the best predictors of their “perception of purpose in life events”—their tendency “to view the world in terms of agency, purpose, and design.”

Americans have believed for centuries that the country was inspired and guided by an omniscient, omnipotent planner and interventionist manager. Since the ’60s, that exceptional religiosity has fed the tendency to believe in conspiracies.

Oliver and Wood found the single strongest driver of conspiracy belief to be belief in end-times prophecies.

People on the left are by no means all scrupulously reasonable. Many give themselves over to the appealingly dubious and the untrue. But fantastical politics have become highly asymmetrical. Starting in the 1990s, America’s unhinged right became much larger and more influential than its unhinged left. There is no real left-wing equivalent of Sean Hannity, let alone Alex Jones. Moreover, the far right now has unprecedented political power; it controls much of the U.S. government.

Why did the grown-ups and designated drivers on the political left manage to remain basically in charge of their followers, while the reality-based right lost out to fantasy-prone true believers?

One reason, I think, is religion. The GOP is now quite explicitly Christian

, as the Syracuse University professor Michael Barkun saw back in 2003 in A Culture of Conspiracy, “such subject-specific areas as crank science, conspiracist politics, and occultism are not isolated from one another,” but ratherthey are interconnected. Someone seeking information on UFOs, for example, can quickly find material on antigravity, free energy, Atlantis studies, alternative cancer cures, and conspiracy.

Religion aside, America simply has many more fervid conspiracists on the right, as research about belief in particular conspiracies confirms again and again. Only the American right has had a large and organized faction based on paranoid conspiracism for the past six decades.

The right has had three generations to steep in this, its taboo vapors wafting more and more into the main chambers of conservatism, becoming familiar, seeming less outlandish. Do you believe that “a secretive power elite with a globalist agenda is conspiring to eventually rule the world through an authoritarian world government”? Yes, say 34 percent of Republican voters, according to Public Policy Polling.

starting in the ’90s, the farthest-right quarter of Americans, let’s say, couldn’t and wouldn’t adjust their beliefs to comport with their side’s victories and the dramatically new and improved realities. They’d made a god out of Reagan, but they ignored or didn’t register that he was practical and reasonable, that he didn’t completely buy his own antigovernment rhetoric.

Another way the GOP got loopy was by overdoing libertarianism

Republicans are very selective, cherry-picking libertarians: Let business do whatever it wants and don’t spoil poor people with government handouts; let individuals have gun arsenals but not abortions or recreational drugs or marriage with whomever they wish

For a while, Republican leaders effectively encouraged and exploited the predispositions of their variously fantastical and extreme partisans

Karl Rove was stone-cold cynical, the Wizard of Oz’s evil twin coming out from behind the curtain for a candid chat shortly before he won a second term for George W. Bush, about how “judicious study of discernible reality [is] … not the way the world really works anymore.” These leaders were rational people who understood that a large fraction of citizens don’t bother with rationality when they vote, that a lot of voters resent the judicious study of discernible reality. Keeping those people angry and frightened won them elections.

But over the past few decades, a lot of the rabble they roused came to believe all the untruths. “The problem is that Republicans have purposefully torn down the validating institutions,”

“They have convinced voters that the media cannot be trusted; they have gotten them used to ignoring inconvenient facts about policy; and they have abolished standards of discourse.”

What had been the party’s fantastical fringe became its middle. Reasonable Republicanism was replaced by absolutism: no new taxes, virtually no regulation, abolish the EPA and the IRS and the Federal Reserve.

The Christian takeover happened gradually, but then quickly in the end, like a phase change from liquid to gas. In 2008, three-quarters of the major GOP presidential candidates said they believed in evolution, but in 2012 it was down to a third, and then in 2016, just one did

A two-to-one majority of Republicans say they “support establishing Christianity as the national religion,” according to Public Policy Polling.

Although constitutionally the U.S. can have no state religion, faith of some kind has always bordered on mandatory for politicians.

What connects them all, of course, is the new, total American embrace of admixtures of reality and fiction and of fame for fame’s sake. His reality was a reality show before that genre or term existed

When he entered political show business, after threatening to do so for most of his adult life, the character he created was unprecedented—presidential candidate as insult comic with an artificial tan and ridiculous hair, shamelessly unreal and whipped into shape as if by a pâtissier.

Republicans hated Trump’s ideological incoherence—they didn’t yet understand that his campaign logic was a new kind, blending exciting tales with a showmanship that transcends ideology.

Trump waited to run for president until he sensed that a critical mass of Americans had decided politics were all a show and a sham. If the whole thing is rigged, Trump’s brilliance was calling that out in the most impolitic ways possible, deriding his straight-arrow competitors as fakers and losers and liars—because that bullshit-calling was uniquely candid and authentic in the age of fake.

Trump took a key piece of cynical wisdom about show business—the most important thing is sincerity, and once you can fake that, you’ve got it made—to a new level: His actual thuggish sincerity is the opposite of the old-fashioned, goody-goody sanctimony that people hate in politicians.

Trump’s genius was to exploit the skeptical disillusion with politics—there’s too much equivocating; democracy’s a charade—but also to pander to Americans’ magical thinking about national greatness. Extreme credulity is a fraternal twin of extreme skepticism.

Trump launched his political career by embracing a brand-new conspiracy theory twisted around two American taproots—fear and loathing of foreigners and of nonwhites.

The fact-checking website PolitiFact looked at more than 400 of his statements as a candidate and as president and found that almost 50 percent were false and another 20 percent were mostly false.

He gets away with this as he wouldn’t have in the 1980s or ’90s, when he first talked about running for president, because now factual truth really is just one option. After Trump won the election, he began referring to all unflattering or inconvenient journalism as “fake news.”

indeed, their most honest defense of his false statements has been to cast them practically as matters of religious conviction—he deeply believes them, so … there. When White House Press Secretary Sean Spicer was asked at a press conference about the millions of people who the president insists voted illegally, he earnestly reminded reporters that Trump “has believed that for a while” and “does believe that” and it’s “been a long-standing belief that he’s maintained” and “it’s a belief that he has maintained for a while.”

Which is why nearly half of Americans subscribe to that preposterous belief themselves. And in Trump’s view, that overrides any requirement for facts.

he idea that progress has some kind of unstoppable momentum, as if powered by a Newtonian law, was always a very American belief. However, it’s really an article of faith, the Christian fantasy about history’s happy ending reconfigured during and after the Enlightenment as a set of modern secular fantasies

I really can imagine, for the first time in my life, that America has permanently tipped into irreversible decline, heading deeper into Fantasyland. I wonder whether it’s only America’s destiny, exceptional as ever, to unravel in this way. Or maybe we’re just early adopters, the canaries in the global mine

I do despair of our devolution into unreason and magical thinking, but not everything has gone wrong.

I think we can slow the flood, repair the levees, and maybe stop things from getting any worse. If we’re splitting into two different cultures, we in reality-based America—whether the blue part or the smaller red part—must try to keep our zone as large and robust and attractive as possible for ourselves and for future generations

We need to firmly commit to Moynihan’s aphorism about opinions versus facts. We must call out the dangerously untrue and unreal

do not give acquaintances and friends and family members free passes. If you have children or grandchildren, teach them to distinguish between true and untrue as fiercely as you do between right and wrong and between wise and foolish.

How many Americans now inhabit alternate realities?

reams of survey research from the past 20 years reveal a rough, useful census of American credulity and delusion. By my reckoning, the solidly reality-based are a minority, maybe a third of us but almost certainly fewer than half.

Only a third of us, for instance, don’t believe that the tale of creation in Genesis is the word of God. Only a third strongly disbelieve in telepathy and ghosts. Two-thirds of Americans believe that “angels and demons are active in the world.”

A third of us believe not only that global warming is no big deal but that it’s a hoax perpetrated by scientists, the government, and journalists. A third believe that our earliest ancestors were humans just like us; that the government has, in league with the pharmaceutical industry, hidden evidence of natural cancer cures; that extraterrestrials have visited or are visiting Earth.

they might at least help clarify the choices that will define the future of our economy.

How did two men, whose work is widely respected, reach such different conclusions from data about the same economy? As I read their papers, I realized that they simply asked different questions.

Hubbard was fascinated by analyzing the ways in which government intervention can distort otherwise efficient markets; many of Summers’s papers explored the reasons markets aren’t always perfectly efficient.

I met Summers and Hubbard in a small, well-appointed room at the Council on Foreign Relations on Manhattan’s Upper East Side to hear them battle it out as if they were preparing to brief the president and leaders of Congress on what must be done to fix our economy right now

I wanted to hear their answers, of course, but I was also interested in how they made them. I wanted to understand the extent to which empirical economic research can provide objective guidance for policy — and at what point even brilliant, highly trained economists resort to articles of faith.

Hubbard quickly zeroed in on the issue that has defined his career. In regard to the size of the government, Hubbard said the real challenge is the steady rise in so-called entitlement spending

His views all seemed to coalesce around a fairly simple idea: the U.S. economy is better off when the government gets out of the way.

Summers’s worldview seemed to take into account more moving pieces. “It would surely be better to address long-run fiscal issues sooner rather than later,” he said. “But this needs to be done in a balanced way. The highest priority is getting the economy growing.”

Their views were especially incompatible when the talk veered to rising inequality.

Summers said he would limit benefits for the rich like “carried interest” rules that allowed private-equity managers (including, I recalled, Mitt Romney) to convert their income, which would be taxed close to 40 percent, into something that looked just like capital gains, which are taxed at 20 percent. He also said that the very wealthy should pay higher inheritance taxes. Dynastic wealth is “highly problematic in a society committed to freedom of opportunity,” he said.

For Hubbard, though, the rich aren’t the problem. The pursuit of wealth, he said, is an engine that powers the economy, and it makes no sense to address inequality by redistributing the very thing that fuels growth. “The real question is ‘What can we do to improve the earnings of lower- and middle-income Americans?’ ” he said. “That’s about increased education and skills training, and that may require higher government spending.” (Hubbard’s belief in more education financing sets him apart from more doctrinaire conservatives.) Hubbard also dismissed Summers’s concerns about dynastic wealth. So few Americans have that kind of money, he said, that taxing them doesn’t make a major impact on the nation’s finances.

In the end, it became clear that Hubbard sees many of our economic challenges — rising entitlements, inequality and even the financial crisis — as different manifestations of the same basic problem: unsustainable debt. Those challenges also have the same solution. If Congress and the White House can agree on a long-term plan to reduce the entitlements, everything will begin to look better. With a permanent solution in sight, investors will gain confidence from the fact that their country’s finances are in good shape and that their future tax burden will be lower; companies will hire workers. Then, once the big fiscal problem is solved, the government can redouble its efforts on education and help the truly needy.

. “There is no serious statistical evidence in support of the view that tax rates at current levels have a major disincentive effect on economic growth,” he said. He suggested, pointedly, comparing the rapid economic growth during the Clinton years with the comparatively worse performance of the post-tax-cut Bush period.

Summers settled on his point: The United States, he said, is not simply facing one unified problem that could be solved through one straightforward solution. The country is facing myriad challenges, starting with unemployment and slow growth. These immediate challenges, he said, can be addressed with a 10-year commitment by the government to spend $1 trillion on infrastructure.

both men took evident satisfaction in sticking to their guns, leaving me feeling the frustration that many do these days: Why can’t these two sides just work something out?

t he has come to think of the presidential election of 2016 as a battle between whoever will hire Larry Summers and whoever will hire Glenn Hubbard

Because somewhere in those following four years, he said, the fiscal crisis will become unavoidable, Congress will have to act, and it will have to work with the White House.

Mr. Abiy succeeded partly by mobilizing ordinary citizens to take up arms to block the Tigrayan advance. “Nothing will stop us. The enemy will be destroyed,”

Drones have also hit refugee camps in Tigray and killed dozens of civilians. Despite recent releases of political prisoners by Mr. Abiy, which prompted a phone call with President Joe Biden, the prospect of a cease-fire seems distant.

The conflict threatens to tear apart Ethiopia, a once-firm American ally, and further destabilize the volatile Horn of Africa region.

But after he took office in 2018, he set about draining the group of its power and influence in Ethiopia, infuriating the Tigrayan leadership, which retreated to its stronghold of Tigray. Tensions grew.

In September 2020, the Tigrayans defied Mr. Abiy by going ahead with regional parliamentary elections that had he had postponed across Ethiopia.

Two months later, T.P.L.F. forces attacked a federal military base in Tigray in what they called a pre-emptive strike against federal forces preparing to attack them from a neighboring region.

The Ethiopian military suffered a major defeat in June when it was forced to withdraw from Tigray, and several thousand of its soldiers were taken captive.

Through it all, civilians have suffered most. Since the war started, witnesses have reported numerous human rights violations, many confirmed by a U.N.-led investigation, of massacres, ethnic cleansing and widespread sexual violence.

The T.P.L.F. was born in the mid-1970s as a small militia of ethnic Tigrayans, a group that was long marginalized by the central government, to fight Ethiopia’s Marxist military dictatorship.

Tigrayans make up just 6 or 7 percent of Ethiopia’s population, compared with the two largest ethnic groups, the Oromo and the Amhara, which make up over 60 percent.

But at home, the Tigrayan-dominated government systematically repressed political opponents and curtailed free speech. Torture was commonplace in government detention centers.

Mr. Abiy, a onetime T.P.L.F. ally, moved quickly to purge the old guard. He removed Tigrayan officials from the security services, charged some with corruption or human rights abuses and in 2019 created a new political party. The Tigrayans refused to join.

At the same time, he strengthened his ties to President Isaias Afwerki, the authoritarian leader of Eritrea, who nursed a bitter, longstanding grudge against the Tigrayans.

But by mid-2020 that peace pact had become an alliance for war on Tigray.

Children are dying of malnutrition, soldiers are looting food aid, and relief workers have been prevented from reaching the hardest-hit areas, according to the United Nations and other aid groups. Since July, a government-imposed blockade of Tigray has kept desperately needed aid from reaching the area. In late November, the World Food Program announced that 9.4 million people across northern Ethiopia required food aid.

In western Tigray, ethnic Amhara militias have driven tens of thousands of people from their homes as part of what the United States has called an ethnic cleansing campaign.

Ethiopia’s ties to the United States, once a close ally, have come under great strain. Mr. Biden has cut off trade privileges for Ethiopia and threatened its leaders with sanctions.

He freed political prisoners, abolished controls on the news media and helped mediate conflicts abroad. His peace deal with Eritrea and its authoritarian leader, Mr. Isaias, caused the Ethiopian leader’s international profile to soar and led to his Nobel Peace Prize in 2019.

But even before the war erupted in Tigray, Mr. Abiy had resorted to old tactics of repression — shutting down the internet in some areas, arresting journalists and detaining protesters and critics.

In a stark speech in November, Mr. Abiy called on soldiers to sacrifice their “blood and bone” to bury his enemies in “a deep pit” and “uphold Ethiopia’s dignity and flag.”

“Many cities without Omicron outbreaks also suffered, as their economies are linked to those currently under lockdown,” Zhang said in an email in mid-May. “The economic costs are not limited to a small number of cities, it is a national problem.”

Excluding tax cuts and refunds, the Ministry of Finance said local fiscal revenue grew by 5.4% during the first four months of the year from a year ago. Eight of China’s 31 province-level regions saw a drop in fiscal revenue during that time, the ministry said, without naming them.Incomplete data for the period from Wind Information showed the regions of Qinghai, Shandong, Liaoning, Hebei, Guizhou, Hubei, Hunan and Tianjin posted year-on-year declines in fiscal revenue for the first four months of the year. Tianjin was the worst with a 27% decline.

Even before the latest Covid outbreak, land sales, a significant source of local government revenue, have plunged following Beijing’s crackdown on real estate developers’ high reliance on debt. Local governments are also responsible for implementing tax cuts and refunds that Beijing has announced to support growth.

Although financial data isn’t readily available for many Chinese cities, the southern tech hub of Shenzhen released figures showing a 44% year-on-year drop in fiscal revenue in April to 25.53 billion yuan. That followed a 7% year-on-year decline in March to 22.95 billion yuan.

Beijing in March already announced an increase in transfer of funds from the central to local governments. When asked in May whether that would be expanded, the Ministry of Finance noted some funding for next year would be transferred ahead of time to help local governments with tax refunds and cuts this year.

In late April, Chinese President Xi Jinping called for a nationwide push to develop infrastructure ranging from waterways to cloud computing infrastructure. It was not clear at what scale or timeframe the projects would be constructed.

“We expect the debt to continue to climb this year as a result of these economic pressures,” Yuan said, noting it remains to be seen how Beijing decides to balance economic growth with debt levels this year.

Congress may have to pass yet another short-term stopgap resolution to give them more time to find an agreement.

If a sweeping government funding bill is released without pandemic relief, that would spell serious trouble for the effort to pass Covid aid before Congress breaks for the holidays and could signal the impending demise of the last-ditch effort to secure a stimulus deal.

As of late Monday night, there still was no final consensus, with familiar sticking points: Democrats want state and local money to help ensure workers who provide vital services are not laid off. Republicans believe much of that money will be wasted. And the GOP lawmakers who are open to more state and local aid say there also need to be lawsuit protections for businesses and other entities, but Democrats argue that the GOP proposals on that idea go too far.

House and Senate appropriators are planning to unveil a $1.4 trillion spending bill Tuesday to fund federal agencies until the end of September 2021, which leaves little time before the Friday deadline for what's expected to be a massive package to pass both chambers.

It's clear to virtually everyone in Washington that a deal is within reach that includes several key provisions: An extension of jobless benefits, money for vaccine distribution, funds for schools, small business loans -- among a handful of other issues.

Self-imposed deadlines have a way of slipping in Congress and it's always possible lawmakers won't release a massive funding deal Tuesday despite their intention to do so. If that happens, it could mean that talks over both stimulus and government spending are breaking down and lawmakers may be forced to punt the issue further down the road by walking away from a pandemic stimulus deal during the lame duck session of Congress and passing a short-term funding patch rather than a far broader, comprehensive spending deal.

"Either 100 senators will be here shaking our heads, slinging blame and offering excuses about why we still have not been able to make a law -- or we will break for the holidays having sent another huge dose of relief out the door for the people who need it."

There were clear signs on Monday that Democrats could be forced to abandon a push for at least $160 billion in aid to cash-strapped states and cities in order to get a bipartisan agreement on some relief provisions.

during a 22-minute phone call Monday evening, the speaker told Mnuchin that the GOP insistence to include lawsuit protections for businesses and other entities "remain an obstacle" to getting an agreement on state and local aid -- since Republicans have demanded the two be tied together.

A bipartisan group of lawmakers unveiled the legislative text of a $908 billion compromise Covid relief plan on Monday

If the aid is ultimately dropped from the plan, it would amount to a major concession from Democrats, who had advanced roughly $1 trillion for aid to states and cities as part of a $3 trillion-plus plan that passed the House in May and that the Senate never considered. Democrats had argued the money was paramount to ensure that workers performing vital services -- ranging from first responders to health care workers -- could continue to say on the job.

If Democrats do drop their demand for state and local aid, the consensus bill put forward by the bipartisan coalition on Monday that sidesteps that issue as well as liability protections could serve as a ready-made starting point for what could be agreed to more widely on Covid relief.That bill has a price tag of $748 billion and includes policy ideas that have proven popular across party lines such as a boost to the Paycheck Protection Program

"I am convinced the majority leader will actually bring legislation to the floor that will either take up our $748 billion bill or the total of $908 billion, or perhaps he will pick and choose from what we put together in a bill of his own and attach it to the omnibus spending bill."

According to a summary released on Monday, the bill would provide $300 billion for the Small Business Administration and funds that would give small businesses the chance to benefit from another loan through the PPP with certain eligibility restrictions.There would be $2.58 billion for CDC vaccine distribution and infrastructure and an extension of pandemic unemployment insurance programs for 16 weeks along with a $300 per week expansion of federal supplemental unemployment insurance benefits

politics have increasingly become a matter of personal identity. Just about all of her subjects felt a deep sense of bitterness toward elites and city dwellers; just about all of them felt tread on, disrespected and cheated out of what they felt they deserved.

this “rural consciousness” is key to understanding which political arguments ring true to her subjects.

most rural Wisconsinites supported the tea party's quest to shrink government not out of any belief in the virtues of small government but because they did not trust the government to help “people like them.”

it is hard to conclude that the people I studied believe what they do because they have been hoodwinked. Their views are rooted in identities and values, as well as in economic perceptions; and these things are all intertwined.”

So it’s all three of these things — the power, the money, the respect. People are feeling like they’re not getting their fair share of any of that.

Cramer shows that there are nuances to political rage. To understand Trump's success, she argues, we have to understand how he tapped into people's sense of self.

people felt that they were not getting their fair share of decision-making power. For example, people would say: All the decisions are made in Madison and Milwaukee and nobody’s listening to us. Nobody’s paying attention, nobody’s coming out here and asking us what we think. Decisions are made in the cities, and we have to abide by them

people would complain that they weren’t getting their fair share of stuff, that they weren’t getting their fair share of public resources. That often came up in perceptions of taxation. People had this sense that all the sense that all the money is sucked in by Madison, but never spent on places like theirs.

people felt that they weren’t getting respect. They would say: The real kicker is that people in the city don’t understand us. They don’t understand what rural life is like, what’s important to us and what challenges that we’re facing. They think we’re a bunch of redneck racists.

Many have pointed out that American politics have become increasingly tribal; Cramer takes that idea a step further, showing how these tribal identities shape our perspectives on reality.

Look at all the graphs showing how economic inequality has been increasing for decades. Many of the stories that people would tell about the trajectories of their own lives map onto those graphs, which show that since the mid-'70s, something has increasingly been going wrong.

It’s just been harder and harder for the vast majority of people to make ends meet. So I think that’s part of this story. It’s been this slow burn.

So what do you think set it all off? Cramer: The Great Recession didn’t help. Though, as I describe in the book, people weren’t talking about it in the ways I expected them to. People were like, Whatever, we’ve been in a recession for decades. What’s the big deal?

Part of it is that the Republican Party over the years has honed its arguments to tap into this resentment. They’re saying: “You’re right, you’re not getting your fair share, and the problem is that it’s all going to the government. So let’s roll government back.”

truth be told, I think many people saw the election of an African American to the presidency as a threat. They were thinking: Wow something is going on in our nation and it’s really unfamiliar, and what does that mean for people like me?

I think in the end his presence has added to the anxieties people have about where this country is headed.

What I heard from my conversations is that, in these three elements of resentment — I’m not getting my fair share of power, stuff or respect — there’s race and economics intertwined in each of those ideas.

The other really important element here is people’s perceptions. Surveys show that it may not actually be the case that Trump supporters themselves are doing less well — but they live in places where it’s reasonable for them to conclude that people like them are struggling.

We know that when people think about their support for policies, a lot of the time what they’re doing is thinking about whether the recipients of these policies are deserving. Those calculations are often intertwined with notions of hard work, because in the American political culture, we tend to equate hard work with deservingness.

it’s not just people of color. People are like: Are you sitting behind a desk all day? Well that’s not hard work. Hard work is someone like me — I’m a logger, I get up at 4:30 and break my back. For my entire life that’s what I’m doing. I’m wearing my body out in the process of earning a living.

through resentment and these notions of deservingness, that’s where you can see how economic anxiety and racial anxiety are intertwined.

It’s not just resentment toward people of color. It’s resentment toward elites, city people.

it’s the perceptions that people have about their reality are the key driving force here. That’s been a really important lesson from this election.

As I was reading your book it really struck me that the people you talked to, they really have a strong sense of what they deserve, and what they think they ought to have. Where does that come from? Cramer: Part of where that comes from is just the overarching story that we tell ourselves in the U.S. One of the key stories in our political culture has been the American Dream — the sense that if you work hard, you will get ahead.

the notion that they are not getting what they deserve, it comes from them feeling like they’re struggling. They feel like they’re doing what they were told they needed to do to get ahead. And somehow it’s not enough.

Oftentimes in some of these smaller communities, people are in the occupations their parents were in, they’re farmers and loggers. They say, it used to be the case that my dad could do this job and retire at a relatively decent age, and make a decent wage. We had a pretty good quality of life, the community was thriving. Now I’m doing what he did, but my life is really much more difficult

Cramer: It’s not inevitable that people should assume that the decline in their quality of life is the fault of other population group

here’s where having Bernie Sanders and Donald Trump running alongside one another for a while was so interesting. I think the support for Sanders represented a different interpretation of the problem. For Sanders supporters, the problem is not that other population groups are getting more than their fair share, but that the government isn’t doing enough to intervene here and right a ship that’s headed in the wrong direction.

There’s just more and more of a recognition that politics for people is not — and this is going to sound awful, but — it’s not about facts and policies. It’s so much about identities, people forming ideas about the kind of person they are and the kind of people others are. Who am I for, and who am I against?

Policy is part of that, but policy is not the driver of these judgments. There are assessments of, is this someone like me? Is this someone who gets someone like me?

putting energy into trying to understanding they way they view the world and their place in it — that gets us so much further toward understanding how they’re going to vote, or which candidates are going to be appealing to them.

All of us, even well-educated, politically sophisticated people interpret facts through our own perspectives, our sense of what who we are, our own identities.

I don’t think that what you do is give people more information. Because they are going to interpret it through the perspectives they already have. People are only going to absorb facts when they’re communicated from a source that they respect, from a source who they perceive has respect for people like them.

People for months now have been told they’re absolutely right to be angry at the federal government, and they should absolutely not trust this woman, she’s a liar and a cheat, and heaven forbid if she becomes president of the United States. Our political leaders have to model for us what it’s like to disagree, but also to not lose basic faith in the system. Unless our national leaders do that, I don’t think we should expect people to

Thank God I was as naive as I was when I started. If I knew then what I know now about the level of resentment people have toward urban, professional elite women, would I walk into a gas station at 5:30 in the morning and say, “Hi! I’m Kathy from the University of Madison”?

And then I would go back for a second visit, a third visit, a fourth, fifth and sixth. And we liked each other. Even at the end of my first visit, they would say, “You know, you’re the first professor from Madison I’ve ever met, and you’re actually kind of normal.” And we’d laugh. We got to know each other as human beings.

That’s partly about listening, and that’s partly about spending time with people from a different walk of life, from a different perspective. There’s nothing like it. You can’t achieve it through online communication. You can’t achieve it through having good intentions. It’s the act of being with other people that establishes the sense we actually are all in this together.

And there may not be much uniting such a wide range of parties other than in their desire to oust Netanyahu. With pressing issues such as how to keep the ceasefire holding with Hamas-led militants in Gaza and rising tensions in East Jerusalem and the West Bank, this could be a fragile government easily broken apart by ideological divisions.

He tries to break free of narrow specialization and cross the boundaries between scientific disciplines. Expeditions beyond economics’ borders and its connection to history, philosophy, psychology, and ancient myths are not only refreshing, but necessary for understanding the world of the twenty-first century.

Reality is spun from stories, not from material. Zdeněk Neubauer

“The separation between the history of a science, its philosophy, and the science itself dissolves into thin air, and so does the separation between science and non-science; differences between the scientific and unscientific are vanishing.”

The study of the history of a certain field is not, as is commonly held, a useless display of its blind alleys or a collection of the field’s trials and errors (until we got it right), but history is the fullest possible scope of study of a menu that the given field can offer.

History of thought helps us to get rid of the intellectual brainwashing of the age, to see through the intellectual fashion of the day, and to take a couple of steps back.

That is the reason for this book: to look for economic thought in ancient myths and, vice versa, to look for myths in today’s economics.

stories; Adam Smith believed. As he puts it in The Theory of Moral Sentiments, “the desire of being believed, or the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires.”

“The human mind is built to think in terms of narratives … in turn, much of human motivation comes from living through a story of our lives, a story that we tell to ourselves and that creates a framework of our motivation. Life could be just ‘one damn thing after another’ if it weren’t for such stories. The same is true for confidence in a nation, a company, or an institution. Great leaders are foremost creators of stories.”

contrary to what our textbooks say, economics is predominantly a normative field. Economics not only describes the world but is frequently about how the world should be (it should be effective, we have an ideal of perfect competition, an ideal of high-GDP growth in low inflation, the effort to achieve high competitiveness …). To this end, we create models, modern parables,

I will try to show that mathematics, models, equations, and statistics are just the tip of the iceberg of economics; that the biggest part of the iceberg of economic knowledge consists of everything else; and that disputes in economics are rather a battle of stories and various metanarratives than anything else.

Before it was emancipated as a field, economics lived happily within subsets of philosophy—ethics, for example—miles away from today’s concept of economics as a mathematical-allocative science that views “soft sciences” with a scorn born from positivistic arrogance. But our thousand-year “education” is built on a deeper, broader, and oftentimes more solid base. It is worth knowing about.

is a paradox that a field that primarily studies values wants to be value-free. One more paradox is this: A field that believes in the invisible hand of the market wants to be without mysteries.

mathematics at the core of economics, or is it just the icing of the cake, the tip of the iceberg of our field’s inquiry?

we seek to chart the development of the economic ethos. We ask questions that come before any economic thinking can begin—both philosophically and, to a degree, historically. The area here lies at the very borders of economics—and often beyond. We may refer to this as protoeconomics (to borrow a term from protosociology) or, perhaps more fittingly, metaeconomics (to borrow a term from metaphysics).

The more important elements of a culture or field of inquiry such as economics are found in fundamental assumptions that adherents of all the various systems within the epoch unconsciously presuppose. Such assumptions appear so obvious that people do not know what they are assuming, because no other way of putting things has ever occurred to them, as the philosopher Alfred Whitehead notes in Adventures of Ideas.

I argue that economic questions were with mankind long before Adam Smith. I argue that the search for values in economics did not start with Adam Smith but culminated with him.

We should go beyond economics and study what beliefs are “behind the scenes,” ideas that have often become the dominant yet unspoken assumptions in our theories. Economics is surprisingly full of tautologies that economists are predominantly unaware of. I

argue that economics should seek, discover, and talk about its own values, although we have been taught that economics is a value-free science. I argue that none of this is true and that there is more religion, myth, and archetype in economics than there is mathematics.

In a way, this is a study of the evolution of both homo economicus and, more importantly, the history of the animal spirits within him. This book tries to study the evolution of the rational as well as the emotional and irrational side of human beings.

I argue that his most influential contribution to economics was ethical. His other thoughts had been clearly expressed long before him, whether on specialization, or on the principle of the invisible hand of the market. I try to show that the principle of the invisible hand of the market is much more ancient and developed long before Adam Smith. Traces of it appear even in the Epic of Gilgamesh, Hebrew thought, and in Christianity, and it is expressly stated by Aristophanes and Thomas Aquinas.

This is not a book on the thorough history of economic thought. The author aims instead to supplement certain chapters on the history of economic thought with a broader perspective and analysis of the influences that often escape the notice of economists and the wider public.

Progress (Naturalness and Civilization)

The Economy of Good and Evil

from his beginnings, man has been marked as a naturally unnatural creature, who for unique reasons surrounds himself with external possessions. Insatiability, both material and spiritual, are basic human metacharacteristics, which appear as early as the oldest myths and stories.

the Hebrews, with linear time, and later the Christians gave us the ideal (or amplified the Hebrew ideal) we now embrace. Then the classical economists secularized progress. How did we come to today’s progression of progress, and growth for growth’s sake?

The Need for Greed: The History of Consumption and Labor

Metamathematics From where did economics get the concept of numbers as the very foundation of the world?

All of economics is, in the end, economics of good and evil. It is the telling of stories by people of people to people. Even the most sophisticated mathematical model is, de facto, a story, a parable, our effort to (rationally) grasp the world around us.

idea that we can manage to utilize our natural egoism, and that this evil is good for something, is an ancient philosophical and mythical concept. We will also look into the development of the ethos of homo economicus, the birth of “economic man.”

The History of Animal Spirits: Dreams Never Sleep

Masters of the Truth

Originally, truth was a domain of poems and stories, but today we perceive truth as something much more scientific, mathematical. Where does one go (to shop) for the truth? And who “has the truth” in our epoch?

Our animal spirits (something of a counterpart to rationality) are influenced by the archetype of the hero and our concept of what is good.

The entire history of ethics has been ruled by an effort to create a formula for the ethical rules of behavior. In the final chapter we will show the tautology of Max Utility, and we will discuss the concept of Max Good.

The History of the Invisible Hand of the Market and Homo Economicus

We understand “economics” to mean a broader field than just the production, distribution, and consumption of goods and services. We consider economics to be the study of human relations that are sometimes expressible in numbers, a study that deals with tradables, but one that also deals with nontradables (friendship, freedom, efficiency, growth).

When we mention economics in this book, we mean the mainstream perception of it, perhaps as best represented by Paul Samuelson.

By the term homo economicus, we mean the primary concept of economic anthropology. It comes from the concept of a rational individual, who, led by narrowly egotistical motives, sets out to maximize his benefit.

the Epic of Gilgamesh bears witness to the opposite—despite the fact that the first written clay fragments (such as notes and bookkeeping) of our ancestors may have been about business and war, the first written story is mainly about great friendship and adventure.

Even today we live in Gilgamesh’s vision that human relations—and therefore humanity itself—are a disturbance to work and efficiency; that people would perform better if they did not “waste” their time and energy on nonproductive things.

is a story of nature and civilization, of heroism, defiance, and the battle against the gods, and evil; an epic about wisdom, immortality, and also futility.

But it is in friendship where—often by-the-way, as a side product, an externality—ideas and deeds are frequently performed or created that together can altogether change the face of society.19 Friendship can go against an ingrained system in places where an individual does not have the courage to do so himself or herself.

started with Babylonians—rural nature becomes just a supplier of raw materials, resources (and humans the source of human resources). Nature is not the garden in which humans were created and placed, which they should care for and which they should reside in, but becomes a mere reservoir for natural (re)sources.

To be human seems to be somewhere in between, or both of these two. We

The entire history of culture is dominated by an effort to become as independent as possible from the whims of nature.39 The more developed a civilization is, the more an individual is protected from nature and natural influences and knows how to create around him a constant or controllable environment to his liking.

The epic captures one of the greatest leaps in the development of the division of labor. Uruk itself is one of the oldest cities of all, and in the epic it reflects a historic step forward in specialization—in the direction of a new social city arrangement. Because of the city wall, people in the city can devote themselves to things other than worrying about their own safety, and they can continue to specialize more deeply.

“The chief thing which the common-sense individual wants is not satisfactions for the wants he had, but more, and better wants.”47

If a consumer buys something, theoretically it should rid him of one of his needs—and the aggregate of things they need should be decreased by one item. In reality, though, the aggregate of “I want to have” expands together with the growing aggregate of “I have.”

the Old Testament, this relationship is perceived completely differently. Man (humanity) is created in nature, in a garden. Man was supposed to care for the Garden of Eden and live in harmony with nature and the animals. Soon after creation, man walks naked and is not ashamed, de facto the same as the animals. What is characteristic is that man dresses (the natural state of creation itself is not enough for him), and he (literally and figuratively) covers52 himself—in shame after the fall.53

Nature is where one goes to hunt, collect crops, or gather the harvest. It is perceived as the saturator of our needs and nothing more. One goes back to the city to sleep and be “human.” On the contrary, evil resides in nature. Humbaba lives in the cedar forest, which also happens to be the reason to completely eradicate it.

Symbolically, then, we can view the entire issue from the standpoint of the epic in the following way: Our nature is insufficient, bad, evil, and good (humane) occurs only after emancipation from nature (from naturalness), through culturing and education. Humanity is considered as being in civilization.

The city was frequently (at least in older Jewish writings) a symbol of sin, degeneration, and decadence—nonhumanity. The Hebrews were originally a nomadic nation, one that avoided cities. It is no accident that the first important city57 mentioned in the Bible is proud Babylon,58 which God later turns to dust.

is enough, for example, to read the Book of Revelation to see how the vision of paradise developed from the deep Old Testament period, when paradise was a garden. John describes his vision of heaven as a city—paradise is in New Jerusalem, a city where the dimensions of the walls(!) are described in detail, as are the golden streets and gates of pearl.

Hebrews later also chose a king (despite the unanimous opposition of God’s prophets) and settled in cities, where they eventually founded the Lord’s Tabernacle and built a temple for Him. The city of Jerusalem later gained an illustrious position in all of religion.

this time Christianity (as well as the influence of the Greeks) does not consider human naturalness to be an unambiguous good, and it does not have such an idyllic relationship to nature as the Old Testament prophets.

If a tendency toward good is not naturally endowed in people, it must be imputed from above through violence or at least the threat of violence.

If we were to look at human naturalness as a good, then collective social actions need a much weaker ruling hand. If people themselves have a natural tendency (propensity) toward good, this role does not have to be supplied by the state, ruler, or, if you wish, Leviathan.

How does this affect economics?

us return for the last time to the humanization of the wild Enkidu, which is a process we can perceive with a bit of imagination as the first seed of the principle of the market’s invisible hand, and therefore the parallels with one of the central schematics of economic thinking.

Sometimes it is better to “harness the devil to the plow” than to fight with him. Instead of summoning up enormous energy in the fight against evil, it is better to use its own energy to reach a goal we desire; setting up a mill on the turbulent river instead of futile efforts to remove the current. This is also how Saint Prokop approached it in one of the oldest Czech legends.

Enkidu caused damage and it was impossible to fight against him. But with the help of a trap, trick, this evil was transformed into something that greatly benefited civilization.

By culturing and “domesticating” Enkidu, humanity tamed the uncontrollable wild and chaotic evil

Enkidu devastated the doings (the external, outside-the-walls) of the city. But he was later harnessed and fights at the side of civilization against nature, naturalness, the natural state of things.

A similar story (reforming something animally wild and uncultivated in civilizational achievement) is used by Thomas Aquinas in his teachings. Several centuries later, this idea is fully emancipated in the hands of Bernard Mandeville and his Fable of the Bees: or, Private Vices, Publick Benefits. The economic and political aspects of this idea are—often incorrectly—ascribed to Adam Smith.

Here the individual does not try anymore to maximize his goods or profits, but what is important is writing his name in human memory in the form of heroic acts or deeds.

immortality, one connected with letters and the cult of the word: A name and especially a written name survives the body.”77

After this disappointment, he comes to the edge of the sea, where the innkeeper Siduri lives. As tonic for his sorrow, she offers him the garden of bliss, a sort of hedonistic fortress of carpe diem, where a person comes to terms with his mortality and at least in the course of the end of his life maximizes earthly pleasures, or earthly utility.

In the second stage, after finding his friend Enkidu, Gilgamesh abandons the wall and sets out beyond the city to maximalize heroism. “In his (…) search of immortal life, Gilgamesh

The hero refuses hedonism in the sense of maximizing terrestrial pleasure and throws himself into things that will exceed his life. In the blink of an eye, the epic turns on its head the entire utility maximization role that mainstream economics has tirelessly tried to sew on people as a part of their nature.81

today remember Gilgamesh for his story of heroic friendship with Enkidu, not for his wall, which no longer reaches monumental heights.

the eleventh and final tablet, Gilgamesh again loses what he sought. Like Sisyphus, he misses his goal just before the climax

The very existence of questions similar to today’s economic ones can be considered as the first observation. The first written considerations of the people of that time were not so different from those today. In other words: The epic is understandable for us, and we can identify with it.

We have also been witnesses to the very beginnings of man’s culturing—a great drama based on a liberation and then a distancing from the natural state.

Let us take this as a memento in the direction of our restlessness, our inherited dissatisfaction and the volatility connected to it. Considering that they have lasted five thousand years and to this day we find ourselves in harmony with a certain feeling of futility, perhaps these characteristics are inherent in man.

with the phenomenon of the creation of the city, we have seen how specialization and the accumulation of wealth was born, how holy nature was transformed into a secular supplier of resources, and also how humans’ individualistic ego was emancipated.

For small acts (hunting together, work in a factory), small love is enough: Camaraderie. For great acts, however, great love is necessary, real love: Friendship. Friendship that eludes the economic understanding of quid pro quo. Friendship gives. One friend gives (fully) for the other. That is friendship for life and death,

less a civilized, city person is dependent on nature, the more he or she is dependent on the rest of society. Like Enkidu, we have exchanged nature for society; harmony with (incalculable) nature for harmony with (incalculable) man.

human nature good or evil? To this day these questions are key for economic policy: If we believe that man is evil in his nature, therefore that a person himself is dog eat dog (animal), then the hard hand of a ruler is called for. If we believe that people in and of themselves, in their nature, gravitate toward good, then it is possible to loosen up the reins and live in a society that is more laissez-faire.

For a concept of historical progress, for the undeification of heroes, rulers, and nature, mankind had to wait for the Hebrews.

Because nature is not undeified, it is beyond consideration to explore it, let alone intervene in it (unless a person was a two-thirds god like Gilgamesh). It

As early as the “dark” ages, the Jews commonly used economic tools that were in many ways ahead of their time and that later became key elements of the modern economy:

Gilgamesh’s story ends where it began. There is a consistency in this with Greek myths and fables: At the end of the story, no progress occurs, no essential historic change; the story is set in indefinite time, something of a temporal limbo.

For a nation originally based on nomadism, where did this Jewish business ethos come from? And can the Hebrews truly be considered as the architects of the values that set the direction of our civilization’s economic thought?

PROGRESS: A SECULARIZED RELIGION One of the things the writers of the Old Testament gave to mankind is the idea and notion of progress. The Old Testament stories have their development; they change the history of the Jewish nation and tie in to each other. The Jewish understanding of time is linear—it has a beginning and an end.

The observance of God’s Commandments in Judaism leads not to some ethereal other world, but to an abundance of material goods (Genesis 49:25–26, Leviticus 26:3–13, Deuteronomy 28:1–13) (…) There are no accusing fingers pointed at

There are no echoes of asceticism nor for the cleansing and spiritual effect of poverty. It is fitting therefore, that the founders of Judaism, the Patriarchs Abraham, Isaac and Jacob, were all wealthy men.12

about due to a linear understanding of history. If history has a beginning as well as an end, and they are not the same point, then exploration suddenly makes sense in areas where the fruits are borne only in the next generation.

however, the idea of progress itself underwent major changes, and today we perceive it very differently. As opposed to the original spiritual conceptions, today we perceive progress almost exclusively in an economic or scientific-technological sense.

Because care for the soul has today been replaced by care for external things,

This is why we must constantly grow, because we (deep down and often implicitly) believe that we are headed toward an (economic) paradise on Earth.

Only since the period of scientific-technological revolution (and at a time when economics was born as an independent field) is material progress automatically assumed.

Jewish thought is the most grounded, most realistic school of thought of all those that have influenced our culture.17 An abstract world of ideas was unknown to the Jews. To this day it is still forbidden to even depict God, people, and animals in symbols, paintings, statues, and drawings.

economists have become key figures of great importance in our time (Kacířské eseje o filosofii dějin [Heretical Essays in the Philosophy of History]). They are expected to perform interpretations of reality, give prophetic services (macroeconomic forecasts), reshape reality (mitigate the impacts of the crisis, speed up growth), and, in the long run, provide leadership on the way to the Promised Land—paradise on Earth.

REALISM AND ANTIASCETICISM Aside from ideas of progress, the Hebrews brought another very fundamental contribution to our culture: The desacralization of heroes, nature, and rulers.

Voltaire writes: “It certain fact is, that in his public laws he [Moses] never so much as once made mention of a life to come, limiting all punishments and all rewards to the present life.”21

As opposed to Christianity, the concept of an extraterrestrial paradise or heaven was not developed much in Hebrew thought.19 The paradise of the Israelites—Eden—was originally placed on Earth at a given place in Mesopotamia20 and at a given time,

The Hebrews consider the world to be real—not just a shadow reflection of a better world somewhere in the cloud of ideas, something the usual interpretation of history ascribes to Plato. The soul does not struggle against the body and is not its prisoner, as Augustine would write later.

The land, the world, the body, and material reality are for Jews the paramount setting for divine history, the pinnacle of creation. This idea is the conditio sine qua non of the development of economics, something of an utterly earthly making,

The mythology of the hero-king was strongly developed in that period, which Claire Lalouette summarizes into these basic characteristics: Beauty (a perfect face, on which it is “pleasant to look upon,” but also “beauty,” expressed in the Egyptian word nefer, not only means aesthetics, but contains moral qualities as well),

THE HERO AND HIS UNDEIFICATION: THE DREAM NEVER SLEEPS The concept of the hero is more important than it might appear. It may be the remote origin of Keynes’s animal spirits, or the desire to follow a kind of internal archetype that a given individual accepts as his own and that society values.

This internal animator of ours, our internal mover, this dream, never sleeps and it influences our behavior—including economic behavior—more than we want to realize.

Anthropology knows several archetypes of heroes. The Polish-born American anthropologist Paul Radin examined the myths of North American Indians and, for example, in his most influential book, The Trickster, he describes their four basic archetypes of heroes.

The Torah’s heroes (if that term can be used at all) frequently make mistakes and their mistakes are carefully recorded in the Bible—maybe precisely so that none of them could be deified.32

the Hebrew heroes correspond most to the Tricksters, the Culture Bearers, and the Twins. The divine muscleman, that dominant symbol we think of when we say hero, is absent here.

Undeification, however, does not mean a call to pillage or desecration; man was put here to take care of nature (see the story of the Garden of Eden or the symbolism of the naming of the animals). This protection and care of nature is also related to the idea of progress

For the heroes who moved our civilization to where it is today, the heroic archetypes of the cunning trickster, culture bearer, and sufferer are rather more appropriate.

the Old Testament strongly emphasizes the undeification of nature.37 Nature is God’s creation, which speaks of divinity but is not the domain of moody gods

in an Old Testament context, the pharaoh was a mere man (whom one could disagree with, and who could be resisted!).

RULERS ARE MERE MEN In a similar historical context, the Old Testament teachings carried out a similar desacralization of rulers, the so-called bearers of economic policy.

Ultimately the entire idea of a political ruler stood against the Lord’s will, which is explicitly presented in the Torah. The Lord unequivocally preferred the judge as the highest form of rule—an

The needs of future generations will have to be considered; after all humankind are the guardians of God’s world. Waste of natural resources, whether privately owned or nationally owned is forbidden.”39

Politics lost its character of divine infallibility, and political issues were subject to questioning. Economic policy could become a subject of examination.

44 God first creates with the word and then on individual days He divides light from darkness, water from dry land, day from night, and so forth—and He gives order to things.45 The world is created orderly— it is wisely, reasonably put together. The way of the world is put together at least partially46 decipherably by any other wise and reasonable being who honors rational rules.

THE PRAISE OF ORDER AND WISDOM: MAN AS A PERFECTER OF CREATION The created world has an order of sorts, an order recognizable by us as people,

From the very beginning, when God distances Himself from the entire idea, there is an anticipation that there is nothing holy, let alone divine, in politics. Rulers make mistakes, and it is possible to subject them to tough criticism—which frequently occurs indiscriminately through the prophets in the Old Testament.

Hebrew culture laid the foundations for the scientific examination of the world.

Examining the world is therefore an absolutely legitimate activity, and one that is even requested by God—it is a kind of participation in the Creator’s work.51 Man is called on to understand himself and his surroundings and to use his knowledge for good.

The Book of Proverbs emphasizes specifically several times that it was wisdom that was present at the creation of the world. Wisdom personified calls out:

The last act, final stroke of the brush of creation, naming of the animals—this act is given to a human, it is not done by God, as one would expect. Man was given the task of completing the act of creation that the Lord began:

MAN AS A FINISHER OF CREATION The creation of the world, as it is explained in Jewish teachings, is described in the Book of Genesis. Here God (i) creates, (ii) separates, and (iii) names [my emphasis]:

Naming is a symbolic expression. In Jewish culture (and also in our culture to this day), the right to name meant sovereign rights and belonged, for example, to explorers (new places), inventors (new principles), or parents (children)—that is, to those who were there at the genesis, at the origin. This right was handed over by God to mankind.

The Naming itself (the capital N is appropriate) traditionally belongs to the crowning act of the Creator and represents a kind of grand finale of creation, the last move of the brush to complete the picture—a signature of the master.

Without naming, reality does not exist; it is created together with language. Wittgenstein tightly names this in his tractatus—the limits of our language are the limits of our world.53

Reality is not a given; it is not passive. Perceiving reality and “facts” requires man’s active participation. It is man who must take the last step, an act (and we