Next step: we found it necessary to bring in systems theory, a discipline used by engi�neers and scientists, but shunned by economists as the Devil does Holy Water. Why? Because official economics identifies the entire economy with the market. That done, it can ignore the ecology, the household economy, the public sector, and all the other subsystems of the economy whose core motive is not maximizing anybody's profits, but performing its own basic task. The public sector provides services that are not sold but distributed by political decision. The house�hold economy is concerned with raising a family and keeping it functioning from the birth to death of its members. The many subsystems of the ecology must protect survival conditions of man and his environ�ment. All these non-market subsystems speak the language of money, but they talk it with foreign accents. Making money is not their main purpose but merely a means of achieving that purpose. Forget that, and start applying the logic of the marker to these non-market subsystems you come up with ridiculous results. When the present President of Harvard University, Lawrence Summers, was a high official of the World Bank, he argued that dumping toxic waste in Africa would be more efficient, because wages there were lower, as was human life expectancy.

The defining characteristic of systems theory is that in a system all the subsystems must be kept in functioning order, doing each its thing, for the whole system to go on performing.

There is no lack of speeches of people in power about the importance of public health and the environment, but these concerns are not in the decision-snaking loop. The guiding code is strictly increasing profits. All else is an "externality," and the damage done to it is "collateral damage." You will see at once that systems theory is not an option but a must, to make our economy not only people-friendly, but workable. All the subsystems interact with one another. None can be just part of another's food chain. There is nothing abstract, complex, or pretentious about systems theory. It is an essential guide to handling the problems that frustrate social reformers. It is open-ended. It will not tolerate anyone's dogma.

But once we see the economy as a system of many subsystems, we have to view any economic measure not as a scalar but as a vector. A scalar is an absolute quantity with no sense of direction. A vector has a sense of direction. It crosses the boundaries between one subsystem of an economy and another and back again, and when it does, its significance changes. It interacts with the sub-system it enters according to the specific local laws.

Official economics identifies the economy with the market, and that, moreover, is a highly imaginary market that never existed. It is based on assumptions adopted to be able to use infinitesimal calculus. All actors of the market are assumed of such tiny size that nothing they do or leave undone individually can affect price or anything else. They have no other information than the price of the last unit sold. They go on producing blindly until they just break even on the last unit produced. How they can be so dumb and so smart at the same time is a mystery that may seem not to matter, because all these ridiculous premises on which marginal utility is based are kept under wraps. But without those premises all the economics taught in our universities are without foundation. They presaged the utter divorce between the financial bubble of the New Economy and real production. The were the bin Ladens of Manhattan Disaster #l.

There are other ways developed by mathematicians and scientists that are immensely useful in foretelling what policies will be disastrous and what might work. Very little command of mathematics is needed to grasp their general principles. There is for example the test of dimension analysis. That explains why bigger is not necessarily better or even as good in nature's workshop. Forces usually depend upon mass which is related to volume which varies as the cube of linear dimension. The power of resistance of muscles and bones, on the other hand, is likely to be the cross section which increases with the square of its linear dimension. That explains why an insect can drop from the top of a skyscraper and reach the earth unharmed, while a man will be killed by falling very few storeys. That is enough to knock out the inevitability of Deregulation and Globalization. It should invite second thoughts about allowing banks to merge, when each party has already become too big to be allowed to fail. Combined with banking deregulation that invites them to engage in mega-gambles secure in the knowledge that the government will have to bail them out. That has happened throughout the world at least once a decade in a really big way.

Then there is the modular congruence arithmetic of the great 19th century Friedrich Gauss.

Don't be frightened by the words" modular congruence." Like the hero of the French classic, who was surprised to find that he had been talking prose his whole life, our ancestors intuitively applied Gaussian modular congruence when they named the days of the week. Instead of devising a new name for every day since the birth of the Lord, they eliminated the multiples of seven and started over again with the same seven names. D&G by contrast adds unnecessary mileage through scarcely known lands. That multiplies the number of variables of the problems that can crop up, while the variables in the solution remain just market supply and demand.