A NEW GUIDE FOR THE PERPLEXED

How the Clone Prince Went Mad!

by Lyndon H. LaRouche, Jr.

September 10, 2001

The following was originally composed on the day preceding the terrifying events of Sept. 11. In light of the wild disinformation-campaign being conducted, around the clock, by CNN and other leading U.S. news media, what is written here has a quality of importance best termed "urgent." The way in which a mass-delusion is being willfully fostered by a lying mass-media, must be understood scientifically from the standpoint outlined below. I have amended the original draft of this report accordingly.

Consider this, then, for what it was originally intended to become: a technical manual, a guide for the perplexed, which is supplied to assist counterintelligence specialists and relevant others in overcoming the perplexities of the presently onrushing, profound changes in the world's order.

In my review of the case of the hypothetical "clone prince," I summarized the evidence showing that there is a fundamental, which is to say axiomatic, quality of difference between human and animal behavior.[1] Typically, in all successful phases of cultures, human behavior is dominated increasingly, by the genetic-like influence of the individual's acquired memories of those mental acts which are functionally equivalent to an experimentally validated discovery of a universal physical principle.

Such memories are not deductive images of the footprints left by an act of discovery. They could never be reduced to sets of algebraic equations and diagrams written on a blackboard. They are, rather, memories of the unfolding process of that process of discovery as such.

They are like well-performed Classical musical compositions of the series begun with the work of J.S. Bach: an unfolding process of self-development, a perfect unity, which, from beginning to close, remains functionally not divisible into parts.[1] Each discovery is a memory of the experiencing of a relevant cognitive process, not of a thing. It is not an ensemble of sense-perceptions; it is a definite, but monad-like object of cognitive thought. Do not let that term, monad, frighten you; I shall explain the significance of that functional distinction, at a suitable place, below.

However, as I have emphasized, repeatedly, over recent decades, in addition to their inclusion of some valid such principles, most cultures are also permeated with false principles, arbitrary assumptions which the victims express as habituated beliefs, false beliefs which are used as substitutes for valid universal principles.[2]

Those victims treat such habituated false beliefs as if they had been acquired as discoveries of valid universal principles. In reality, such beliefs are not merely false, but are counterfeits of true discoveries; they are mental behavior of the type we rightly call "delusions." Such false principles produce pathological effects which I have sometimes identified as "the goldfish-bowl syndrome." In cases corresponding to that "goldfish-bowl syndrome," the victims of such delusions limit their actions to choices which lie within certain imaginary boundaries, boundaries defined by false, axiom-like, ideological assumptions of induced blind faith.

In the annals of science, the most notorious among the deranged persons so defined, is the "perfectly logical" professor at the blackboard, who insists that proof of the mere deductive consistency of his "ivory tower" system, is a perfect substitute for the aspect of the physical universe which the professor claims his concoction to describe. The most extreme expressions of that pathetic state of mind, the expressions sometimes the most dangerous to society, are usually found either among certifiable lunatics, or, among mathematicians, such as the Bertrand Russell apostle, and putative founder of "systems analysis," John von Neumann.

The Christian Apostle Paul's denunciation of "single-issue morality," as in his I Corinthians 13, should be accepted as a warning to the credulous victims of such popularized delusions. Hans Christian Andersen's famous fable of "The Emperor's New Suit of Clothes," illustrates the way in which such mass delusions express themselves as "popular opinion."

How Romantics Die

Large-scale social systems which cling stubbornly to such delusions, doom themselves over the course of time. This self-inflicted doom may unfold over centuries, as in ancient Rome. It may sometimes unfold in the short run, or over one or more generations, as the fascist systems of Adolf Hitler and Benito Mussolini did. The presently onrushing collapse of the global monetary and financial system, began in the United Kingdom, as the first government of Labour Prime Minister Harold Wilson led that monarchy into the catastrophic sterling collapse of Autumn 1967. Changes similar those introduced under Wilson, were already in progress inside the U.S.A. by the mid-1960s. The result was not only the U.S. dollar crisis of January-March 1968; the same self-destructive trend in policy-shaping, was consolidated to become a dominant factor in U.S.A. policy-shaping over the 1966-1981 interval of U.S. political history.

This long-term downturn in the U.S. economy, began with Richard Nixon's pro-racist "Southern Strategy" campaign of 1966-1968 and his August 1971 wrecking of the world monetary system. The wrecking of the U.S. economy during one term of the disgusting President Jimmy Carter, was more destructive than under the nearly two terms of Nixon's Presidency. These terrible, axiomatic errors introduced over the 1966-1981 interval, have continued to destroy the U.S. economy, and much of the rest of the world, ever since.

For such reasons, the 1969-2001 collapse, is to be compared with the self-inflicted ruin of the Roman and Habsburg empires. It is among the notable examples of a collapse-cycle built into the intrinsically pathological axiomatic assumptions of a large-scale social system.

As I shall show below, all so-called "free trade" and related social, political-economic systems, are similarly doomed, as the case of the present world monetary-financial collapse demonstrates.

I emphasize a point I have made repeatedly in other writings and oral argument. Ask yourself: what is the power of popularized delusions over the mind and will of both individual persons, and even over the ruling establishment of self-doomed entire nations? The answer is: it is the lust of the individual to bask in the coddling warmth of popularized prejudices, such as popularized delusions of an axiomatic character. "None of the people I respect would agree with you," is typical of the way in which a self-doomed individual, or even a nation, will cling with passion to the delusion which dooms it, like a drowning man clinging to a sinking ship's anchor. It is the all-too-typical present-day politicians' predilection for kissing the foot of popular opinion, no matter how disgusting that fouled foot might be, which is the most commonplace form of moral corruption of contemporary, day-to-day political processes of government.

As a result of such passions, a people, a nation, such as Germany ruled by Adolf Hitler, may ensure its own ruin, even the destruction of its very existence. The currently widespread blind faith among the U.S. population, that a systemic financial crash is either not going to occur at all, or the wishful conceit, that any financial crash must soon rebound with a recovery, is typical of that same class of popularized delusions. This, for example, is the susceptibility to popular opinion on which today's U.S. "Big Brother," the mass-media, depends for its usually successful "brainwashing" of the majority of the U.S. population, and also the majority of those in the highest positions of our leading political parties, and government, today.

A manifold of combined true and false beliefs of that axiomatic quality of effect, constitutes what is sometimes referred to as a "mind-set." Here, in this report, we are contrasting the characteristic, functional differences between sane and delusion-ridden mind-sets. Our emphasis is on the cases of mass-delusions underlying the rise and fall of entire social systems. The inevitable, now onrushing disintegration of the presently self-doomed, global monetary-financial system, is an example of such mass-delusions.

In other words, not only are so-called principles introduced, which originate in nothing other than deliberate falsehoods; the same "intuitional," specifically human, creative faculties of cognition, by means of which valid discoveries of universal physical principle are generated, are often misused by recklessly careening minds, to create ignorantly concocted, pathological pseudo-principles. The controlling mind-set of the individual victim of such induced mass-delusions, treats his or her such arbitrary, experimentally baseless beliefs, as if they were infallible universal principles. It is usually sufficient for that dupe of so-called "herd instinct," that he believe such beliefs to conform to popular opinion.

I shall show that the presently accelerating disintegration of the 1971-2001 world monetary-financial system, is an outcome of just such a quality of pathological mental behavior on a mass scale. In other words, belief in that system, is an example of a mass-delusion, a mass-psychosis.

In the field of strategic and related political analysis, a field in which I have become exceptionally successful in recent decades, an understanding of the characteristics of such induced mind-sets, is the indispensable basis for competence in long-range, global economic forecasting. These same methods of inquiry are also more or less indispensable in all aspects of political-intelligence investigations, such as the attempted coup d'état in progress, set into motion by the events of Sept. 11.

Properly developed and applied, these methods enable the qualified practitioner to foresee the inevitable characteristics of the long-term consequences of a persisting form of defective mind-set, if not to foresee the exact, specific choice among such consequences, which the victims will choose to bring upon themselves.

These methods are indispensable for making sense of the world-wide crisis descending upon all of humanity today. No competent assessment of the present U.S.A. and global crisis could be made in any other way. I have published much on this subject over recent decades. I summarize the momentarily most relevant elements of that argument here. These methods are indispensable for defining the changes in policy which must be adopted, if a culture is to be saved from what is otherwise its inevitable, self-inflicted ruin.

To demonstrate these distinctions, I have often found it convenient, pedagogically, to show that the belief in so-called "Newtonian mathematical physics" is such a widely popularized delusion. I introduce the notion of the function of mind-sets in mass behavior, by defining the meaning of "systems." For that reason, I begin with the case of the widespread academic pathology known as the cult of Sir Isaac Newton. After that, I show how that overview of the nature of systems must be applied, to understand the current mental state of the majority of the population, and leading circles, of the U.S.A. and many other nations today.

1. The Cult of Isaac Newton

Britain's famous monetarist John Maynard Keynes, after studying the contents of the so-called scientific papers found in Sir Isaac Newton's chest, characterized Newton as a shameful, anti-scientific creature, whose beliefs should be classed as echoes of the ancient Mesopotamian abacadabrists. Keynes did not exaggerate. The origins of belief in the fantasy-universe of Sir Isaac Newton, may be traced back as far as the fanatically irrationalist forms of ancient cults of Delphi, the Eleatics, the sophists, and the Aristotelean method of Claudius Ptolemy, or to the cult of William of Ockham in medieval times.

The more immediate, specific origin of Newton's delusion, is the Ockham admirer Paolo Sarpi, who, together with his lackey Galileo Galilei, gave England the naked, raw empiricism of Sir Francis Bacon and Thomas Hobbes. Out of the fag end of Seventeenth-Century empiricism, decadent elements in the U.S. population acquired that modern American pragmatism of William James, John Dewey, and Walter Lippmann, which has dominated U.S. policy-shaping, increasingly, over the course of the Twentieth Century. The presently pathetic state of mind of the majority of U.S. society, has been spewed from that latter source.

Apart from the contrary influence of President Franklin Roosevelt, the delusions typical of American pragmatism have dominated the U.S.A., since the successful, 1901 assassination of U.S. President William McKinley brought the notoriously pro-Confederacy figures Theodore Roosevelt and, later, Ku Klux Klan fanatic Woodrow Wilson, into the Presidency.

Galileo follower Newton typifies the empiricist influence of not only Bacon, Hobbes, Locke et al., but also Descartes, and Descartes' admirer and aging Newton's controller, the same, Paris-based Abbot, Antonio Conti, who also virtually invented that notorious pro-Newton, anti-Leibniz fanatic, Voltaire. The version of empiricism spread by the Venetian Conti and his Europe-wide network of salons, such as the circles of the hoaxsters Maupertuis and Leonhard Euler in Berlin, subsumes the entire sweep of the fanatically irrationalist French and British "Enlightenment" of the Eighteenth Century, and also of the sickly Nineteenth-Century Romanticism of Immanuel Kant, G.W.F. Hegel, and their followers, up to the present time. The cult of Newton, and its corrupting influence on science, to this day, is typical of that specific trend in moral and intellectual corruption pervading the culture of globally extended, contemporary European civilization.

These generically Romantic,[3] Eighteenth- and Nineteenth-Century influences represent, taken together, the core of the ideology which is chiefly responsible for all of the principal horrors contributed to humanity as a whole by Twentieth-Century European civilization. Such is the continuing character and effect of empiricism, in its role as a pandemic cultural disease, up to the present moment of that civilization's presently onrushing, existential crisis.

Therefore, it is not only urgent that we focus on the exemplary problem of Newton's empiricism; we are aided in this work by the fact, that the crucial evidence of empiricism's mass follies is so clear over the course of these recent centuries. That evidence should compel thoughtful people to ask themselves: Why do even many scientists defend the obvious absurdities of Newton's "system," still today? The answer is, the popularity of Newton reflects nothing so much as the cancerous influence of that legacy of ancient Rome, the cult of vox populi, more popularly known today as "popular opinion."

Many typical victims of the Newton delusion passed their courses in secondary schools and universities, through accepting mindless drill in Newtonian and kindred systems. This was usually a condition of passing their courses, securing their university degrees, securing their professional employment, and surviving that modern inquisition known as the Babylonian ("babble-on-ian")-like priesthood of the "peer review" committees controlling most science-related publications.

As a result of such brainwashing, even gifted experimental scientists, even those with important, experimentally verified discoveries to their credit, were often impelled to babble at the blackboard, in their effort to defend their discoveries in terms acceptable for presentation in the relevant, "babble-on-ian" peer-review proceedings. The contemporary cases of duped followers of Bertrand Russell clones Norbert Wiener ("information theory") and John von Neumann ("systems analysis," "artificial intelligence"), or the recent decade's substitution of intrinsically incompetent "benchmarking" for competent engineering, are typical results. This typifies the decadent academic product which today's radical-empiricism-dominated, inquisitional peer-review committees, prefer, increasingly, to misname "science."

In contrast to the Newton cult, sane forms of modern science and its method, are traced principally from their roots in Plato's Socratic dialogues. That tradition was introduced into modern European civilization through the founding of modern experimental physical science by Cardinal Nicholas of Cusa. Johannes Kepler founded comprehensive modern mathematical physics, on the basis of what he explicitly adopted as the basis in scientific method provided by such avowed followers of Cusa as Luca Pacioli and Leonardo da Vinci.

After Kepler, the list of most notable among the principal contributors to the development of competent forms of mathematical physics, includes Pierre Fermat, Christiaan Huyghens, and Gottfried Leibniz. Leibniz was followed by such notables as Abraham Kästner, by the French associates of the U.S.A.'s Benjamin Franklin, by the circles of France's Gaspard Monge and Lazare Carnot, and by Germany's Alexander von Humboldt, Carl Gauss, Wilhelm Weber, and Bernhard Riemann.

Focus upon the contrast between those two, mutually opposing views on the subject of systems: the so-called "Euclidean" view typical of the Newton cult, versus the modern science of Cusa, Kepler, Leibniz, et al. Keep in mind that our goal here, is to clarify the way in which not only economic, but social and philosophical systems, more or less predetermine those long waves in history which unfold over a generation or longer. The point is to indicate, that a nation's fate can be changed, by an appropriate quality of willful change in its prevailing system of belief, its prevalent mind-set.

What Is a System?

As I have emphasized in locations published earlier: within globally extended modern European culture, the conventional notion of the term "system," is modelled upon what used to be generally accepted classroom Euclidean geometry. That system was defined by, first of all, a collection of interdependent definitions, axioms, and postulates, and, secondly, chiefly an array of those theorems which were derived, chiefly by deduction, from the initial set of axiomatic-like assumptions. Within the bounds of modern European civilization, the strict use of the term "system," including "social systems," reflects a notion based on comparisons to the image of Euclidean geometry as a taught system.[4]

The assumption, that the physical universe must be understood as lying within the bounds of those pathetically naive notions of sense-certainty, respecting space and time, which are associated with Euclidean geometry, is, in essentials, the characteristic feature of the cases in which a "Euclidean system," such as that of Isaac Newton, is superimposed upon mathematical physics. This was the fatal flaw common to the otherwise mutually conflicting astronomical systems of Claudius Ptolemy, Copernicus, and Tycho Brahe.[5]

Within the domains of mathematical physics more broadly defined, the image of a "system" is an echo of the influence of rather narrowly defined Euclidean mathematical physics, but with the addition of some accompanying, specific changes in meaning. Two, mutually contradictory such variations in the definition of a mathematical system, are of leading importance for our topic here; the most important models for these contradictory variations are known as either "non-Euclidean," or "anti-Euclidean" geometries.

The first variation, is the result of replacing some among the definitions, axioms, and postulates, but, without departing otherwise from the underlying assumptions of a Euclidean model. Typical of this, are physical systems consistent with so-called "non-Euclidean" geometries of Nikolai Lobachevsky and Janos Bolyai.

The second variation, is the result of challenging some among those assumptions underlying all systems consistent with either a Euclidean, or non-Euclidean model. Those notions of scientific method which reject all efforts to confine mathematical physics to either Euclidean, or non-Euclidean geometries, are therefore known as anti-Euclidean systems.

The work of Gauss's teacher Abraham Kästner, is typical of systems consistent with anti-Euclidean models.[6] Bernhard Riemann's revolutionary, 1854 habilitation dissertation, defines the essential principles of all experimentally verifiable anti-Euclidean forms of physical geometry. The model on which this present report is based, is what might be termed my own neo-Riemannian model for a general anti-Euclidean system.

Kästner emphasized that, rather than attempt to improve upon Euclidean geometry, as the advocates of non-Euclidean geometry do, we must challenge the assumptions which underlie each and all of the definitions, axioms, and postulates of that system. Gauss's student, Riemann, carried forward Kästner's policy in Riemann's own, original, 1854, specifications for an anti-Euclidean geometry. In that dissertation, and later, Riemann expelled from science all unproven kinds of so-called "self-evident" definitions, axioms, and postulates, including those of the Euclidean and non-Euclidean geometries.[7]

In place of all arbitrary (e.g., so-called "self-evident") definitions, axioms, and postulates, Riemann restricts axiomatic notions of an extended magnitude, to experimentally verified universal physical principles as such. In place of the space-time-matter dimensions of a Euclidean or non-Euclidean design for mathematical physics, he allows only experimentally validated universal physical principles as "dimensions" of physical geometry.

Implicitly, in Riemannian physics, space and time themselves exist only in the form and reciprocal relationships which are implicit in verified discoveries of universal physical principle. So, as the successive work of, among others, Fermat, Huyghens, Leibniz, and Bernouilli, defined and refined a general notion of isochronic action in relativistic space-time. Hence, Riemannian relativistic physics. So, it is to be said that Riemann restricts the measurement of the characteristic relationships among such magnitudes, to experiment, explicitly excluding all "at the blackboard" mathematics from use as a substitute for experimental physical science.

The destructive impact of the post-1989 popularization of so-called, computer-based "benchmarking," as a replacement for competent, traditional standards of engineering-design practice, is an example of the way in which the popularization of "at the blackboard" algebra has been adopted as a pathetic replacement for science.

My original discoveries go beyond Riemann's specific argument. I concur with the Vladimir I. Vernadsky who defined the biosphere, and distinguished the biosphere as such, from the changes imposed upon the universe by human cognition. He identified the effect of the latter changes as the noösphere. However, my own view features two elementary considerations lacking in Vernadsky's published work.

First, I have adopted the method of Riemannian physical geometry, as the necessary way of conceptualizing the universe in terms of a multiply-connected manifold of three mutually distinct—axiomatically distinct—classes of universal physical principles: non-living, life, and cognition.

Second, where Vernadsky focuses upon the individual mind's contribution to man's mastery of nature, through discovery of universal physical principles, I specify the necessity of a certain intervening step. I warn that man's mastery of nature does not occur simply through the action of the individual's discovery of an experimentally verified hypothesis. It occurs through the impact of an individual's discovery in changing the set of universal physical principles adopted by society.

A crucial feature of the shortfall in Vernadsky's definition of the noösphere, was his lack of familiarity with precisely those crucial features and implications of Riemannian physical geometries which I made central to the application of my own original discoveries of the 1948-1953 interval, those made within the domain of Gottfried Leibniz's science of physical economy.

To describe my discoveries and their application as a system, the following points are essential. I summarize here what I have elaborated in sundry published locations.

The standard reading of Euclidean geometry began, with the purely arbitrary assumption, that the correct notions of indefinitely extended space and time, are to be intuited by blind faith in one's own senses. The Euclidean's, and Newtonian's deluded belief in so-called "self-evident" definitions, axioms, and helping postulates, should be recognized as reflecting childish blind faith in sense-certainty.

The following types of false assumptions are thus intuited from that latter delusion.

The first false assumption is, that space and time are each extended, as if in straight lines without limit. Thus, on that assumption, all the real occurrences whose effects are presented to us through our senses, are misstated in terms of relations among points.

Therefore, we must focus upon the commonplace, intuitive, pathological, classroom and other meaning assigned to the notion of an abstract, mathematical "point." Much of the mental illness invading today's teaching of mathematical physics, is most readily identified in this popular delusion. That pathological, arbitrary belief in the elementary self-evidence of the existence of the geometric or algebraic point (and point-mass), is the crucial folly inhering in all efforts to adduce a mathematical physics consistent with Euclidean or analogous forms of geometry.

This issue of the conception of the physical nature of that which sense-certainty views as a self-evident point, is the dividing-line between science and the delusions of sense-certainty. The argument to be made runs as follows.

All sane mathematical physics, in particular, proceeds from a specifically contrary intuition. In fact, the elementary form of experience is not a point-like, inferred object of sense-perception, but, rather, is change. This is change as Heraclitus and Plato successively define the ontological concept of change, instead of a point, as elementary.[8] In other words, the irreducible element of existence is change as such, instead of the abstract point of Euclidean and related geometries and algebras. This distinction is the elementary difference between pathological systems, such as those of the empiricists and positivists, and those of healthy science.

In pathological mathematical methods, such as those used by the followers of Claudius Ptolemy, Copernicus, and Tycho Brahe, physical processes are merely described by the method of connecting observed points ("dots") in ways which presume that all observed processes can be explained mathematically, as if at the blackboard. Theirs is the same, nominalist assumption adopted, arbitrarily, by Euler, that the representation of physical motion, and the causes for that motion, are reducible, in the infinitesimally small, to either straight-line connections, or a very near approximation of such estimates.[9] All of mathematical physics premised upon that fanatically expressed, false assumption of mathematical determinism, as by Euler, and also by empiricists and positivists generally, therefore represents axiomatically linear systems, even when such are sometimes misnamed "non-linear systems."

In anti-Euclidean geometries, such as those of Riemann, the underlying physical connection among occurrences and observed "dots" is governed by discoverable, experimentally verifiable universal physical principles. For Riemannian physics, each principle is a quality of Leibnizian monad. Each principle has its own characteristic quality of action, and all relevant principles interact, in the manner of Leibniz's monads, in what Riemann identifies as a multiply-connected way.

The first approximation of a comprehensive such form of mathematical physics, was introduced by Johannes Kepler. It was Kepler's work which prompted Leibniz's uniquely original development of a calculus, and from which the mathematical physics of such Leibniz successors as Gauss and Riemann was derived.

In real science, principles are never adduced by "connecting the dots," as if merely statistically. In real science, the trajectory of action is determined by universal physical principles, as this is illustrated by the process of discovery underlying Kepler's original identification of a principle of universal gravitation. That was the discovery which exposed, and disproved conclusively the false method inherent in the astronomy of Ptolemy, Copernicus, and Brahe, for the case of systems of non-uniform curvature. The method adopted by Kepler, in overturning the false assumptions common to those three, provides the relatively simplest proof, that the reductionist definition of the abstract mathematical "point," is false. This proof obliges science to return to the notion of the universality of change, as emphasized by Heraclitus and Plato. For that, we must examine the issue in a way which is more general than formal mathematics as such. See the same problem as it arises in music.

Music as an Example

As I have emphasized in locations published earlier, there is an indispensable function performed by introducing certain matters of Classical well-tempered counterpoint to the discussion of the elements of physical systems. The operations of deductive-logical argument, which are usually regarded as the quality of thinking about mathematics, disregard the most essential feature of those mental processes through which the discovery and transmission of knowledge of verifiable universal physical principles occurs, the feature fairly identified as passion.

The ideologues of deductive mathematics take pride in their exclusion of the consideration of human passion in general. Admittedly, only a mentally deranged person would seek to resolve differences on the subject of mathematics, by symbolic trials in the bloody arena of bodily contact sports. Nonetheless, contrary to the famous argument of the morally deranged Immanuel Kant, there is a specific quality of human passion, without which the work of discovering and transmitting knowledge of universal physical principles could not occur. This specific quality of passion is not only essential for scientific discovery. As Kepler introduced the notion of the intentions of the Solar System, for defining the principle of universal gravitation, passion, in the sense of intention, must be included by the mind as an integral part of the image of the physical universe outside our sense-perceptions as such. This passion is not only characteristic of the act of discovery; it is also the essential internal quality, of intention, of that which is discovered. The same quality of passion is intrinsic to Classical well-tempered counterpoint.

A valid discovery of principle in physical science, is essentially, intrinsically, a work of love, the quality of love which Plato's Socrates identifies by his use of the Greek term agape. This quality of agape, is the active principle of composition and performance in all valid expressions of what is usefully distinguished as Classical artistic composition, as opposed to Romantic, modernist, and so on. It is typical of great Classical poetry and drama, and of such Classical products in plastic art-forms as the work of Leonardo da Vinci and Raphael Sanzio. In the non-plastic forms of Classical composition, the Classical method of well-tempered counterpoint, is the highest form of expression of this quality of action by the human mind.

Therefore, any competent discussion of those qualities of human reason which express cognition explicitly, must focus upon all of those products of human reason which express the fullness of the relevant cognitive process of discovery itself. This is in contrast to reductionist mathematical physics, which considers only the mere shadows of reality, as these might be projected on the mathematical formalist's blackboard or computer screen.[10]

Therefore, let us look briefly at my foregoing argument against nominalism, this time from the vantage-point of J. S. Bach's method of counterpoint, as clearly defined from his famous Well-Tempered Clavier through his A Musical Offering and The Art of the Fugue. This is the polyphonic method, of Bach, upon which all strictly Classical forms of musical composition, such as those of Mozart, Haydn, Beethoven, Schubert, Mendelssohn, Schumann, and Brahms are based. Close examination of the central physical principle underlying Bach's discovery of well-tempered counterpoint, illustrates the way in which the cognitive processes of the individual mind, uncover the nature of that real physical world which exists beyond the limits of the nominalist's interpretation of our senses.

The point to be made is situated as follows.

Bach's method is rooted in the legacy of that same, Fifteenth-Century, Florentine bel canto mode of voice training also prescribed in scientific terms by the scientist, master builder, painter, and musician, Leonardo da Vinci. The root, in the physical universe as a whole, of Bach's development in counterpoint, is the way in which the naturally determined register-shifts, and related characteristics of trained human singing voices, are defined.[11]

Bach's counterpoint begins with a paradoxical germ-principle of change, which must be stated, for comprehension, in terms of mentally heard human singing voices, each of exact human singing-voice species, in the minds of the composer and competent performer. Without focus upon the natural bel canto qualities of the trained human singing voice, great music does not exist. "Purely instrumental" music does not exist in the domain of civilized Classical composition and performance. Only instruments which are compelled to sing as bel canto-trained human voices do, could produce the effect known as Classical well-tempered counterpoint.

The composition as a whole, begins from the simple statement of the initial contrapuntal paradox. The composer's mind hears this as sung by human, bel canto-trained voices, not a mere musical instrument. If it is composed for an instrument, the composer intends that the instruments shall be forced to imitate the qualities of the bel canto-trained human singing voice, and the performer must obey that intention. The origin of Bach's method of well-tempered counterpoint, lies within the domain of the distinctive characteristics of the full chorus of bel canto-trained human singing voices.

It is the state of tension established by the initial announcement of the relevant contrapuntal paradox, which must grip the cognitive processes of the mind of the composer, performers, and audience from the outset. The minds so gripped must never be let go, until the conclusion has been reached. Throughout the composition and performance, there is never mere repetition, but always change. Even when the printed score suggests repetition, the adequate performer and audience hear a crucial feature of change (such as a change in implied bel canto registration of the apposite element, through the implication of a substituted singing voice[12]), in the recapitulation or apparent imitation.

The unfolding composition is a seamless process of change, which resolves the paradox in the end, but also does something more than that. The effect, as is made most clear by Beethoven's late string quartets, or Brahms' Fourth Symphony, is to create a composition which has a distinct personal identity as a process of change. Similarly, the development of the great Classical composers, produces a distinct personality pervading all of their compositions. All of the compositions of great composers are implicitly in dialogue with the characteristic personality of the compositions specific to their own other compositions and also those of other great composers, and also each composition among their own.[13] The mind conceives each as an indivisible individuality, whose characteristic is a pervasive principle of change, a distinct notion of a change.

One of the most relevant controversies over the implications of this point, has been the back-and-forth on the subject of conductor Wilhelm Furtwängler's emphasis upon what is sometimes described as "performing between the notes."

Usually, the ability to perform a Classical composition with at least an approximation of Furtwängler's distinctive excellence, is rooted in a proper form of thorough grounding in the method of composition employed by J.S. Bach. In this proper form, the score is heard as a chorus of bel canto singing voices, both of human singing voices and of instrumental voices which are forced to imitate a human quality of bel canto singing voice. This method, with its modal implications, is the basis for all great Classical musical compositions from Mozart and Haydn, through the exemplary Brahms.

Conducting and performance which are efficiently under such influences, is performed with a special quality of passion. It is that quality of passion, which enables the conductor and performer to reproduce a truly unified conception of the performed Classical composition as a whole.[14] The conductor, for example, has developed in his or her mind a unified conception of the composition as a whole, as if a single mental act of impassioned thought. This thought has the quality of a single, impassioned conception of change as such, rather than the mere succession of the score's notes.[15] The unfolding fabric of the performance as a whole, is made a process of emergence of the affirmation of that single, impassioned idea, at the close. Similarly, unless the attack upon the opening interval of the performed composition is efficiently so predetermined, the soul of that composition as a whole will tend to limp its way toward the close, if, indeed, it survives the journey at all.

This notion of an impassioned process of change as an existent, indivisible unity, is precisely equivalent to Leibniz's definition of what he terms a monad. Thus, in a competent performance of such works, the performer uses only the intended notes, but what he performs is the monad. A memory of the whole composition as a monadic unity, is the idea conveyed by a successful performance of the composer's intention.[16] The notion of the provable, efficient existence of a discovered universal principle, is also a monad. This definition of monad corresponds exactly to Plato's definition of an idea.

A well-performed great Classical musical composition, is essentially a form of Leibnizian monad. It is typical of all relatively higher-ranking qualities of such monads. It has a distinct identity, distinct from all similar compositions. This identity unifies the process of development which the composition as a whole expresses. Yet, each part of the composition is distinct.

The wholeness of that composition is its existence as a process of cognitive development. This process is inseparable from the specific quality of passion required for its composition and successful performance. However, that existence expresses varying relative values in each aspect of its development. This passion is identifiable as a quality of emotion, with the impulse which enables a scientific discoverer, responding to an ontological paradox in physics, to generate the verifiable hypothesis corresponding to the relevant, needed universal physical principle.

This argument is efficiently illustrated by comparing all of those numerous Classical compositions, of Wolfgang Mozart himself, and of Beethoven, Schubert, Schumann, and Brahms, among others, which explicitly quote the subject of Mozart's Köchel 475 keyboard Fantasy. Each of these, such as Beethoven's Opus 111 sonata, for example, is in a direct relationship with Mozart's Fantasy, and yet each of these has its own distinct personality, even when the cases compared were produced by the same such composer. Indeed, Beethoven includes a contrapuntally crucial kind of direct quotation from that Mozart Fantasy in the coda of the second movement of the Opus 111. Each such composition is a distinctly sovereign personality in itself, a truly distinct musical idea.

Such musical examples also typify the meaning of the notion of the monad which Leibniz developed out of his exploring the implications of his discovery of the calculus. Leibniz's work, with Jean Bernouilli and others, on the elementarity of the catenary function for the calculus in general (Figure 1), points to the process of internal development of the calculus into a higher form of that calculus which subsumes the notions of Analysis Situs, a monadology.[17]

From considering this example provided by music, we are led to recognize the related requirement of a bel canto quality of sung musicality inhering in all Classical poetry; from this, we are guided to discover the way in which the greatest composers, such as Shakespeare and Schiller, produced their great compositions on the subjects of tragedy and the sublime.

When such considerations are placed in conjunction with the evidence provided by the application of Riemannian physical geometry to the principles and practice of physical economy, we are impelled to comprehend the universality of the notion of cognitive ideas, beyond the narrower bounds of today's academic mathematical-physics teaching as such.

The Fallacy of Sense-Certainty

The relevant, crucial illustrative fact underlined by that musical example, is the following.

In Riemann's system of physical geometries, extensible change is expressed in the form of an experimentally demonstrable universal physical principle of change. The universe then appears to the mind as a manifold of many such universal physical principles. These principles interact in what is called a "multiply-connected" way, to define a subsuming principle of universal change, which subsumes the combined effect of all of the physical principles it contains. This quality of universal change is measurable as a characteristic of action in that physical space-time, a characteristic whose value can be determined solely by appropriate types of experimental methods.

Since any Riemannian geometry is subsumed by the change embedded in a succession of such physical geometries, the reality corresponding to a Riemannian physical geometry of practice, is never a fixed geometry. Just as Kepler showed the action of a planet's motion to be subsumed by a higher order of determination, in the characteristics of the orbit considered as a whole, the higher order of geometry, including the cases of changes linking a series of geometries, determines the relevant, intrinsically non-linear value of the differential in the very small.

To similar effect, within any developed mathematical physics, for example, there remain uncorrected, false assumptions parading as universal physical principles, which have yet to be removed. There are, also, far more numerous instances of principles which have yet to be discovered. Thus, investigation must consider both the experimental evidence of change inhering in the process under study, and experimentally defined changes in the methods by which the study is conducted. Both of these are propositions in Riemannian physical geometries.

The use of the term Riemannian geometry, or geometries, varies in relevant meaning and practice, according to the relevant context. On this account, we must recognize, first, a corresponding distinction must be made, between the universe as a totality, and a lesser part of that universe, a smaller number of dimensions, which we call a phase-space. We must also recognize distinctions between a Riemannian geometry, and an ordered series of Riemannian geometries. This notion of a series of differential Riemannian geometries, is crucial in discussing real-life economic processes, such as the evolutionary, or devolutionary physical-economic development of entire societies.

It is crucial to say, once again, that within that context: since each addition of a true principle, or deletion of a false one, changes the manifold of mathematical physics, it were impossible to assign any final, fixed value to a significant differential. Just as the whole Keplerian orbit of Mars or Earth, determines the differential value subsuming an interval of that orbit, so, the apparent differential values must change, as our knowledge of the totality is improved, or, as we recognize the importance of avoiding excessive simplifications of the phase-space of reference.

Again, once more, as in the instance of Kepler's recognition of the equal-angles-equal-times determination of the curvature of a planetary orbit, the conception of the existence of the integral calculus must precede the differential, axiomatically (Figure 2). It is the way of thinking about the relationship between wholes and their included moments, within entire processes, which points the mind to the indications of the existence of higher orders of entire processes in the ontological paradoxes which arise within the existing mathematical physics' representation of the crucial-experimental domain of practice.

For example, it is through meticulous attention to the stubborn, but seemingly tiny margins of error contained within an assumed differential value, that Kepler discovered universal gravitation. Most important fundamental discoveries occur, through the agency of non-deductive cognition, in that way. Hence, contrary to Euler, Lagrange, Cauchy, et al., no competent mathematics will attempt to impose a principle under which the differential is reduced axiomatically to linear approximations.

Each of a set of valid universal physical principles, and also the Riemannian quality of multiply-connected unity among them all, represents a monad, in Leibniz's sense of that term. Riemann's revolutionary discovery redefines the work of experimental mathematical physics in the manner implicit in Leibniz's interrelated notions of Analysis Situs and monadology.

In Riemannian physical geometry and its outgrowths, we distinguish chiefly among two qualities of experimental measurements. On the one side, we have the measurements which suffice for experimental proof of existence of a monad. This monad is comparable, conceptually, to the unique identity of a Classical musical composition premised upon Bach's well-tempered counterpoint. On the other side, we have the need to demonstrate the characteristic features of the changing measurable values for defining relations among monads. In other words, we must distinguish between the experimental evidence which defines the existence of an object, such as a microphysical object, and the measurement which defines the relative location of that object in a particular physical-geometric setting.

The question of the existence of Planck's quantum, as Planck defined it in opposition to the Machians, is an example of the distinction which I am emphasizing here.[18] This produces the specific quality of paradoxical view of the universal experimental domain, the so-called continuum, which is the essence of fruitful scientific discovery.

Take as an example, Kepler's uniquely original discovery of universal gravitation. Kepler apprehends the Solar System as a functionally indivisible coherence, a unity of all Solar processes with the existence of its Sun. From apprehension of the way in which the planetary orbits are located with respect to one another and that Sun, Kepler adduces what Newtonian and other bowdlerizers have misnamed "Kepler's Three Laws." Kepler not only proves, experimentally, that no reductionist statistical analysis can account for the momentary position and velocity of the planet in its orbit; he proves that there exists a universal principle, independent of those statistical measurements, a principle which, in first approximation, expresses an acting principle of universal gravitation.

In a Euclidean, or a specifically non-Euclidean version of physical geometry, each and all of the characteristics of space and time, are fixed. Within that fixed system, everything discovered must be located within that intellectual, "ivory tower," mathematical image of physical-space-time. Thus, the essential definition of existence is implicitly degraded to something located in terms of points mapped in the manifold associated with that physical-space-time. In contrast to this, in Riemannian physical geometries, as in the science of physical economy, experimental science generally is focussed, primarily, on functionally ordered changes in the manifold itself which are associated with the axiomatically defined existence of universal types of objects.

Look at a discovery emphasized by Plato. As was emphasized for modern science by Pacioli, Leonardo da Vinci, and Kepler,[19] the physical implications of the fact of the uniqueness of the five regular Platonic solids, reflect, among other considerations, the distinctness of the system of living processes, as compared to non-living. This signifies, as Vernadsky poses the issue of the distinction of living processes' action in creating the biosphere, that the action of living processes on the abiotic, locks the abiotic material being transformed within a higher physical geometry, that of life itself.

As a general observation, this illustrates the point, that it is an elementary blunder of incompetence in scientific method, to attempt to build up assumptions respecting the characteristic features of systems from observed trajectories in the small; rather, we must discover the nature and characteristics of the geometry in which those actions in the small are situated. For example: The laws of the universe exist only within the geometry underlying that universe in which we exist.

The elementary, axiomatic difference between mere sense-certainty and actual knowledge, is an expression of the same distinction: the significance of an action is shaped by the geometry of the process within which it occurs. Thus, sense-perception represents one system, and the universe which is sensed, another. The relationship between these two respectively inconsistent systems can not be simply mapped; to resolve that paradox, we must introduce a third system, that of man's intention to change the sensed existence of the system outside our sense-certainties. It is only through that third system, that the paradoxical juxtaposition of the different geometries of the sensory and real universe can be comprehended. My discoveries in the field of the science of physical economy address that problem in the only way an adequate insight could be developed.

Look again at what I have just stated about Riemannian physics, this time from the vantage-point of the fellow locked up in that prison called his sense-organs. That poor fellow is poor, both intellectually and morally, only because he is deluded by his conceit, that his organs of sense-perception are transparent windows of the soul, through which the universe outside is plainly displayed to all those who have learned to keep those windows polished and clean. This delusion defines the cult of what is called "sense-certainty."

To restate what I have said on this point in earlier locations, contrary to the delusion called "sense-certainty," our organs of sense-perception do not show us a simple copy of the universe outside our skins. Rather, they reflect the experience of the impact of the world, outside our skins, and also within it, on those organs of sense-perception as such. "Ouch!" is not something which exists outside our skin; but, typically, the effect, of something outside our skin, touching those sense-organs housed within our skin.

The objection to be made against blind faith in sense-certainty, may be expressed, therefore, as a psychiatrist might: "I may accept the bare fact of an existence corresponding to what you report you have felt, but how do you know what caused that feeling? How do you know it was not the result of some mean trick played upon your sense-organs by little green men from outer space?" To meet the challenge of answering such questions honestly, without bluffing, or without simply changing the subject of discussion, we must supply a much stricter definition of "science" than is usually met in textbook or classroom. We must act intentionally on the real universe, to bring about, intentionally, an efficient, perceptible change in the way the world of sense-certainty behaves.

The implied question is, "How can we know the difference between merely sensing an event, as by means of sense-perception, and actually knowing the object which is properly associated with that event?"

The Definition of Knowledge

The known method for answering that question, is traced chiefly to Plato's dramatic, Socratic dialogues as a source. A crucial improvement in that answer, is implicit in Leibniz's definition of a science of physical economy.[20] It has been my historical good fortune, as a discoverer, but my personal misfortune as a contemporary political figure, until now, that an epistemologically satisfactory form of practical answer to that question, was lacking until my own redefining of that question, in my original discoveries in the science of physical economy. I have developed the relative elementary argument in published locations as follows.

That quality of knowledge we may rightly call "scientific," has its origin in the recognition that experience has confronted us with occurrences which could not have occurred in a way which is consistent with the previously established system of opinion-making of a particular culture, nation, teaching, and so on. Such evidence obliges the believer in that system to consider the fact, that axiomatic assumptions which have appeared to explain certain kinds of events, fail to account for some stubborn evidence. Such is the significance of Plato's Socratic dialogues, especially when these are taken as a unified whole, that when they are spoken, heard, and understood as Classical dramatic compositions expressing the principle of the sublime, as Friedrich Schiller, for example, famously defined the sublime.

As examples of this, I have frequently used the case of Kepler's discovery of universal gravitation, as in his New Astronomy, and Pierre Fermat's preliminary, experimental definition of the isochronic principle, that it is "quickest time," rather than shortest distance, which governs the pathway of refraction of light. These types of experimental evidence present us with what is rightly termed, in the technical language of Classical epistemology, an ontological paradox.

The solution for such an ontological paradox, is the discovery of a verified hypothesis. By hypothesis, we signify an idea which has the quality, in form, of a universal physical principle. To qualify for the title of hypothesis, that idea must show either that some relevant axiomatic assumption of the believer was false, or that some additional axiomatic assumption, that of the hypothesis, would produce a new system of thought consistent with all of the relevant evidence. If a certain uniquely appropriate quality of design of experiment, shows that that hypothesis is universally correct, we adopt that hypothesis as a universal physical principle. The result of incorporating such an hypothesis as a universally efficient principle, in that way, is not merely the addition of a new universal principle to the system, but also a revolutionary transformation of the system itself.

Universal physical principles, and non-deductive transformations of systems, effected in that way, qualify as scientific knowledge, as distinct from, and opposed to sense-impressions. No knowledge was ever acquired, except by means of hypotheses defined as I have just summarized the functional meaning of the term hypothesis, contrary to the famous, silly aphorism of Isaac Newton. Examples include the discovery of the principle of universal gravitation, which Kepler discovered, and Newton ineptly plagiarized. Admittedly, one may not require assistance from the methods of hypothesis, to copy the description of an idea, as Newton did, by stealing it.

The quality of mental processes by means of which this progress occurs, from discovery of an ontological paradox to an experimentally proven discovery of a universal physical principle, is the typical form of mental processes which are collectively classed as cognition, as distinct from the imagined objects of sense-certainty. Vladimir Vernadsky justly adopted the term noësis as a designation for the act of discovery of a verifiable universal physical principle. The two terms, cognition and noësis, point toward the same object, the same process of mentation.

As the case of the efficient effect of the existence of objects of microphysics, illustrates the point most dramatically, objects which are visible to cognition, form a different class of the sub-microphysical objects than the objects defined merely by sense-certainty. These objects are termed ideas, in Plato's sense. This class of objects of knowledge, includes not only the universal physical principles of so-called physical science, but also those principles of Classical artistic composition which are discovered and verified in the same way.

This distinction is the central feature of the Socratic dialogues of Plato. There, willingness to accept the evidence that a given system of thought is paradoxical, is the precondition for the truthfulness of the proponent. Cognitive knowledge is truthful; when mere authority, or sense-certainty, or a combination of both, are upheld in defiance of the evidence that such opinion is ontologically paradoxical, the proponent is not truthful.

Thus, for example, the application of those principles leads us to define the entirety of scientific knowledge in the following way.

The notion of the universe, as defined experimentally in terms of human physical-economic activity, that as of the form of a Riemannian series of physical geometries, led me to divide the universe so defined among three general phase-spaces: abiotic, life, and cognition. The difference between my own and Vernadsky's views on this matter, is threefold.

First, I began from the standpoint of cognition, as a phase-space, to define the other two phase-spaces. Second, I adopted the notion of an anti-Euclidean series of Riemannian physical geometries, as my overview of these phase-spaces. Third, I located the individual cognitive processes' actions on the domains of abiotic and living processes, as mediated through the cognitive transmission of ideas into more general social practice, rather than as the individual's action directly on the abiotic and living domains. It is on this latter point, that my approach to defining the physical-economic function, differs from the role of cognition assigned to Vernadsky's definition of the noösphere.

The pivotal feature of my work to this effect, from 1948 on, was tracing the increase of the potential increase of the productive powers of labor, per capita and per square kilometer, from the social process by means of which an original discovery of universal principle generates those technologies which transform both the design of products and of the processes through which those products are generated.

This approach was prompted and conditioned, in turn, by my recurring studies in defense of Leibniz's monadology, against Kant's Critiques, which had become the center of my intellectual preoccupations since mid-adolescence. Thus, rather than attempting to build up to the definition of cognitive phase-space from a succession of abiotic and living phase-spaces, I began always, as to the present day, from the starting-point of cognition as such.

On what authority can we presume to define the systems of abiotic and living processes, by starting from any other point of departure than the process by means of which we actually know the abiotic and living processes, the process of cognition?

The argument to be made on that account, is essentially the following. If, as Vernadsky sums up the modern history of this discovery, the action of living processes on the abiotic processes of Earth produces an effect in the latter which does not occur otherwise in abiotic processes, then an abiotic process so under transformation by a living process, has been brought into existence within a geometry which differs axiomatically from the abiotic as such. A similar distinction was shown by me for the action of cognition on living processes. That being the case, were it not awful stubbornness, or sheer lack of even the most elementary scientific competence, to propose to derive the possible existence of living and cognitive processes from within the axiomatic phase-space domain specific to only the abiotic? Only by choosing cognition as the axiomatic basis, could a competent assessment be made of both the principles of development of the abiotic and living domain, respectively and collectively.

To restate and summarize the implication of that argument, as I have emphasized this in earlier locations. That approach implies that the Riemannian universe is composed of three principal phase-spaces: abiotic, life, and cognition. None of the latter two is implied in a predecessor, rather, the primary, axiomatic order, is the action of life, as a principle, upon the abiotic, and cognition on both the abiotic and living processes. Nothing in the universe exists outside, or independently of these three combined, except as it is created by what may be described as the combined action of those multiply-connected three Riemannian phase-spaces.[21]

The follies of most schools of philosophy, the sundry varieties of the reductionists, most notably, are rooted in the inability of sense-certainty to determine, in and of itself, whether the evidence of the individual's senses is either truthful, or an illusion. The most efficient, conclusive answer to that question, is obtained by tracing out the causes of what is, in fact, a dangerous, currently widespread form of mental illness: belief in "free trade."

Therefore, at this point, we shall hold the needed further discussion of the issue of sense-certainty versus knowledge in abeyance, until the next section of this report, when we will have considered the effects of the mental illness called "free trade" upon the long-term health of the nation's physical economy. At that point, the practical significance of relying upon my use of Riemannian physical geometry, for forecasting long-range effects in economic processes, will be more readily understood.

2. The Cult of `Free Trade'

The timeliness of this present report, is underscored by the inevitability of the accelerating collapse of the world's present, post-August 1971, floating-exchange-rate form of monetary-financial system. The third and fourth quarters of calendar year 2001 are virtually doomsday for this monetary-financial system. Remnants of that system might limp along for a bit longer, like a smoking wreck of an automobile which has burned out its engine's crankshaft; but, it could not be saved in its present form, even by such extreme measures as imposing a national and even global political dictatorship by the terminally decadent, present English-speaking powers.

The physical structure of the present U.S. economy, for example, is in vastly worse degree of relative disrepair than the U.S. found itself during 1929-1933. Only a sweeping and sudden reversal of the policy-changes introduced under the succession of the first Harold Wilson government of the United Kingdom and the U.S. Nixon and Carter Administrations, could prevent a collapse of an economy clinging to the terribly mistaken assumptions of Year 2000 Presidential candidates Bush and Gore. As a matter of practicable politics, only a sudden return to the policy-axioms of the Franklin Roosevelt Presidency, could prevent the U.S. economy itself from being carried to the inevitable doom which looms immediately ahead for the present world monetary-financial system.

Under these special circumstances of crisis, what I have to report here, has extraordinary importance for anyone intending to rescue this economy from that presently onrushing monetary-financial catastrophe.

As my own original discoveries of universal physical-economic principle emerged during the 1948-1952 interval, I was impelled more and more to translate the implied results of my discoveries of principle from an academic, into a practical form, a form comparable to an input-output analysis of national product and national income. Once I had adopted a Riemannian view of the implications of my discoveries, I recognized a potentially fatal fallacy in the way generally accepted accounting practice affected the policy-shaping practice and performance of both private enterprises and U.S. national-income and product accounting. It was from this standpoint, beginning 1948-49, that I focussed attention on the fallacies inhering in the expression of the linear systems analysis which permeated what was also known then as Operations Research.

From those studies, even before my forecasts of the 1966-2001 interval, as early as 1959-60, it was already clear to me, that if generally accepted financial accounting, and related cost-accounting practice, were misinterpreted as suitable for use as instruments of shaping economic policy of firms and governments, that the results must be ultimately failures, even disastrous ones. The premises on which this conclusion must be reached, are essentially those which I have identified above. In this second, concluding section of my present report, I show, in a general way, how such misuse of financial and related forms of accounting practice have contributed greatly, and, as my forecasts have demonstrated, predictably, to the presently onrushing ruin of the U.S. and world economies.

The included result of the use of financial and related forms of accounting practice as an official, and also popular ideology, is expressed in its most pathological, extreme form, as the contemporary form of the U.S. cult of "free trade." It was the combined effect of the Mont Pelerin Society's global political influence and activities, with help of such novelties as the "supply side" cult and the Kemp-Roth legislation derived from it, which have led the once powerful and growing U.S. economy into the wreckage it represents today.

Two Elementary Fallacies

I focus on two aspects of the effects of that misuse of financial accounting and its characteristic ideology. The first, generally underlying fallacy of financial accounting, it that it assumes, mistakenly, that a margin of gain, of financial income over monetary expenditures, is that factor of growth, profit, which defines a healthy enterprise. The second, related fallacy, is the wildly false assumption, that the national income of an economy should be measured as the sum-total of so-called "Value Added" of the nation's individual enterprises.

For example. In the courses on introduction to economics, which I taught at sundry campus and other locations, during the 1966-1973 interval, students expressing a doctrinaire socialist persuasion, would sometimes audit one or two of the thirteen two-hour lectures of that series. Thus, fairly often, during one of the periods of discussion which followed each lecture, I would be challenged by some student, often with a fanatical glint in his eye and voice, who, like a self-appointed spy for the Inquisition, would seek to catch me out as an exposed heretic to the dogma of his current persuasion.

Frequently, such young doctrinaire socialists, especially from among those of avowed libertarian or anarcho-syndicalist inclinations, would insist that "wealth is created `by the horny hand of labor' at the point of production." This, many among these young people of 1966-1973 university campus days, defended, rather fanatically, as what would be fairly considered a corollary of "the labor theory of value." They were both gratified and humiliated by my response to their challenge: gratified that I had exposed myself as a true heretic to their dogma; humiliated by the simple clarity of the evidence which proved their dogma to be an "ivory tower" variety of absurdity. After one or two sessions, they never returned.[22]

Except for the worst variety of classroom "ivory tower" sophists, it is obvious, that if we hold the technology, and other internal features of an enterprise, constant, the principal cause of fluctuations in productivity within that enterprise, and in its impact on the economy as a whole, will be variations, more or less great, induced by the quality of development of the basic economic infrastructure within which the enterprise is situated.

It is also a simple matter of fact, that it is advances in applied technology brought into the enterprise, both respecting design of products and organization of the productive process itself, which largely determine the variability of relative productivity of the labor-force and facilities employed within the operations of that enterprise.

Also, the quality of education supplied both sectors of, and the entirety of the population's households, is a leading determinant of the productive powers of labor within the individual enterprise. The changes in demographic characteristics of the general population, or also even large sections of it, also have a powerful impact on the attainable levels of both average national productivity, and that within particular enterprises.

Furthermore, looking at the process of development of entire economies, we must confront the significance of changes in the composition of employment of the totality of the potential labor-force, and also changing demographic characteristics of both the population as a whole, and of particular strata within it, as of crucial bearing on the determination of relative physical productivity per capita and per square kilometer. For example, the greater the ration of skilled machine-tool and kindred specialists, of the ration employed in pedagogical and research experimentation, and the relative emphasis upon levels of technology and skill for which workplaces are designed, determine the relative productivity in the society as a whole, and thus contribute more to determine the productivity in the particular enterprise than any factor purely internal to either its organization, or the contemplations of the financial accountants and guardians of its merely momentary "shareholder value." Notably, a population with a lower life-expectancy, can not attain, or maintain the productivity, or standard of living comparable to that formerly characteristic of the U.S.A. or western continental Europe.

Anyone who now reflects upon what I have emphasized in the preceding section, will recognize that I am defining the economy as a whole as a system, rather than a collection of individual enterprises. The current notion of an alleged principle of "shareholder value," is not only directly contrary to the Preamble of the Federal Constitution and other expressed intent of that Constitution and Declaration of Independence; it is frankly insane in its inevitable consequences for national practice. I mean a system in the sense of a Riemannian physical geometry, as I have summarily identified the most relevant points in this report so far.

In sorting out the conceptual problems this might appear to pose, we must apply to the individual enterprise the Leibniz-Riemannian notion of relationship between an (ontological, monadic) existence and its immediate position in the system as a whole. We must thus take into account, the effect, on the economy, of the function of its existence per se, and also the effect of its functional location within the national division of labor as a whole.

For example, an existent class of enterprise, such as a closely held entrepreneurship supplying advanced technology to other, larger enterprises, may, by its current position within that economy, prevent a technological bottleneck which would otherwise be destructive of the potential progress of the economy more generally.

As I have stressed, to understand any system, one must approach the investigation from the standpoint of its evolutionary development, its evolutionary-revolutionary transformations in characteristic features. In studying society, in which the human cognitive will is its crucial distinction from abiotic and other living species, what we rightly distinguish as the history of the relevant development of society, provides the method and materials of the investigation.

Today, most popular opinion, included the so-called educated varieties, are expressions of minds trapped within a Flatland of psychedelic fantasies. These victims have lost a real sense of history, during a present time when society feels the effect, more and more, of a situation in which even children in primary and secondary schools, are being drilled more or less daily into allying politically with the school's Orwellian "Big Brother": the controlling social workers and their like, against the pupil's own parents.

Sometimes, these days, one might think that even the Nazi youth organizations were less brainwashed than what has been done to the victims, the pupils, in schools directed by the "Baby Boomer" generation representatives of the asocial tradition of such perverts as Theodor Adorno, Hannah Arendt, and systems analysis. More and more, the pupils so brainwashed into cultural pessimism, consider their own parents, and grandparents, and, more and more, even themselves, "an historical mistake," as apparently, so does avowed "population freak" and former Vice-President Al Gore.

Among the most pathetic of the fanatically ahistorical, systemic delusions popularized in that way, has been the Mont Pelerin Society's utopian image of a "free trade" society. Such is the wicked fairy-tale world, which has gained relative political hegemony since Richard Nixon's 1966-1968 alliance with Ku Klux Klanners, Nashville Agrarians, and like types, in his "Southern Strategy" campaign for the 1968 Presidential election. To expose the form of the delusion of "free trade" rampant in the U.S. today, we must point the finger to the actual origins of the crucial systemic difference between the preceding form of European society, feudalism, and the emergence of modern society, in the form of the sovereign nation-state, beginning the Fifteenth-Century Renaissance.

History and Economy

From approximately the time of the Roman murder of Archimedes, Rome rose rapidly to an hegemonic position in the Mediterranean and its adjoining areas. Its influence superseded that of that superior, Hellenistic culture, which had dominated the eastern Mediterranean since the succession of Classical Greece and the victory of Alexander the Great over the Achaemenid form of the Mesopotamian imperial tradition.

From the self-inflicted moral decay, and decline and fall of the Roman Empire, its power was passed on, by way of changes made by the Roman Emperor Diocletian, soon resulting in the establishing of Byzantium as imperial successor to Rome. As Byzantium itself rotted away under the influence of the Code which Diocletian bequeathed to it, Venice emerged, more than a thousand years ago, to become Constantinople's de facto successor. Venice's hegemony was that of a rentier-financier-based form of imperial maritime power. As the imperial power of Venice waned, during the latter half of the Seventeenth Century, the Netherlands and the British monarchy not only represented the kind of imperial rentier-financier maritime power Venice had formerly commanded; they were developed for this inherited role, under the explicitly Venetian influence expressed as the Eighteenth Century, anti-Classical Enlightenment.

During the entire sweep from approximately 212 B.C., until the Fifteenth Century, extended European civilization was dominated by the triumphant cultural characteristics of ancient Rome, or by the adjusted, Byzantine and Venetian versions of that Roman heritage known as the Code of Diocletian. There were some marginal exceptions, such as the efforts of Charlemagne, the Emperors Friedrich Barbarossa and Frederick II, Alfonso Sabio, and Dante Alighieri, to introduce principles of statecraft and law which anticipated the refined goals set forth by the Fifteenth Century, pioneering forms of the modern nation-state, in Louis XI's France, and Henry VII's England. Until the Fifteenth Century, all such nation-building efforts were interrupted, and crushed by the power of the combination of ruling Romantic oligarchies.[23]

Against that long wave of history, even a relatively modest amount of accurate knowledge of key features of the change from feudalism to the modern nation-state, would suffice to show that the currently popular fads of "free trade" are not only lunatic fantasies, but constitute a systemic threat to the continued existence of civilization on this planet.

For example, consider the mid-1990s alliance, of those determined to uproot the Constitutional principle of the general welfare. This was the alliance between Republican Speaker of the House of Representatives Newt Gingrich and his crony of the late 1970s, Vice-President Al Gore, echoing the original, 1790s, Malthusian action, overturning the English poor laws, by the government of Britain's Prime Minister William Pitt the Younger. For that purpose, Pitt's government had employed the foolish propaganda of Thomas Malthus, who wrote his notorious On Population,[24] parodying the English translation of Giammaria Ortes' treatise on population-control.[25] The same kind of "Malthusian" policy to which Al Gore had been won, had been argued by Giovanni Botero, a Sixteenth-Century contemporary of Paolo Sarpi.[26] The foolish Malthus's parody of Ortes, later found expression in the opinions of the notorious Charles Darwin.

However, what is often called the Malthusian doctrine of today, was already implicit in the Code of Diocletian, and thus, implicitly, the policy of Roman and feudal society. It was this doctrine, as embodied in that Code, which guided Byzantium to that long wave of collapse of its population levels. As George Gemmistos, also known as Plethon, writing at the onset of the Fifteenth Century, warned the Byzantine emperor, these doctrines must be abandoned, if exhausted Constantinople were to survive the onrushing Ottoman conquest. They were not reversed, and Constantinople fell.

The pro-genocidal population policies of Botero, Ortes, Malthus, today's Darwinists, and other neo-Malthusians, are not peculiar to modern society. They were already deeply embedded policies of doctrine and practice in both ancient and feudal society. It was not until the Fifteenth-Century, Italy-centered Renaissance, that the axiomatic basis for such policies was overturned with significant, if partial success, as an integral feature of the initial establishment of the modern, sovereign form of nation-state.

I have said the following, repeatedly, on earlier occasions, but it must be emphasized again here. Prior to the Fifteenth-Century Renaissance, the prevalent doctrine of practice of virtually all society, was to relegate the great majority of the total population to the functional status of virtual human cattle, such as serfs, slaves, or the subject populations of imperial colonies or satrapies, or to a condition expressed by the present-day victims of Orwellian "Big Brother" mass-brainwashing by the leading mass media. The Renaissance's introduction of the principle of the general welfare as natural law, represents a dividing-line between ancient and feudal society, on the one hand, and the emergence of the modern sovereign nation-state republic, such as the model later provided by the U.S. Constitutional republic, on the opposing side.

The ancient Roman, Byzantine, and feudal forerunners of Malthusian population control, expressed, thus, the same alleged principle which the notorious Dr. François Quesnay presented as the crucial axiom of his Physiocratic dogma. I mean that same so-called principle of laissez-faire, which Adam Smith plagiarized from the Physiocrats as "free trade."

There are two crucial assumptions of relevance underlying that doctrine called variously laissez-faire or "free trade."

In the first instance, Quesnay's sophistry is, as Marx's description of Quesnay's Tableau Économique argues, that the "surplus value" of the feudal estate, is the fruit of the aristocratic landlord's possession of the title to that estate. Quesnay's corollary argument is, that the contribution of the peasants to the production of the output of farming or mining, is no more than the landlord would have to pay as the bare cost of sustenance for those virtual human cattle classed as serfs or the like. Therefore, according to Quesnay, the gains in physical output by society are the natural property of the titled land-owners; and, those who actually produce wealth are deemed entitled to no more than a bare subsistence, until such time as they are deemed ripe to be culled, when aged, sick, or deemed too numerous for the landlord's convenience, as cattle are. The relationship of such perverted opinions to the influence of John Locke ad the doctrines of "shareholder value," should be obvious.

The precedent for this curiously nasty sophistry by Quesnay, is to be found in the medieval history of France, as in locations along the Garonne, Tarn, and Rhône, or amid the Pyrenees. That precedent is, the neo-Manichean doctrine of those Cathars otherwise known as the Bogomils. In that cult, the "elect" are rewarded by their god, whatever that thing might be, with benefits which they accrue for no other reason than their status as members of the "elect." We meet the same sophistry in the theology of the notorious U.S. figure of Aaron Burr's grandfather, Jonathan Edwards, an occult pagan belief in which the more lunatic varieties of U.S. gnostic cults participate still today.[27]

The same Physiocratic doctrine of those Bogomils, who are sometimes referred to as "buggers" in the English language,[28] appears as the doctrine of "Property" of England's John Locke, and the notorious pro-satanic Bernard Mandeville.[29] It is, presently, a pervasive feature of the lingering ideology of Richard Nixon's "Southern Strategy" doctrine; it is expressed by the presently dominant trends toward the pro-Confederacy, neo-Lockean dogma of "shareholder value," in the misshaping of adopted U.S. economic policy of practice during the recent thirty-odd years.

The modern effort to attribute some sort of rational cover for that wild sort of arbitrary pagan superstition, can be traced in modern English history from the writings of Galileo's student Thomas Hobbes. The argument to that effect by Mandeville and his followers, such as former Vice-President Al Gore, is, that even billions of daily, apparently random, free-will decisions among the members of society, will tend, in combined effect, to produce benefits for mankind, by agencies which are beyond the powers of mankind to comprehend the workings of such a marvelously secret agency working from under the floorboards of reality.

Precisely that wild-eyed sort of superstitious "algorithm," was virtually shouted by Gore, in his hate-filled vituperations against his host of the moment, the Prime Minister of Malaysia.[30] In the realm of statistical theories, that means that that imaginary thing, the god of the Bogomils, is running the universe as a crooked gambling house; it means that such doctrines are not economic matters arguable among rational beings, but an intrinsically unarguable sort of gnostic mystery religion, for which no rational defense ever will, or could be presented.

In the case of Adam Smith, the same sort of pagan mystery religion dominated the views he expressed even prior to his departure to France, that under the patronage and instruction of the British East India Company's notorious Lord Shelburne. Exemplary is a passage which the departed David P. Goldman and I quoted from Smith's 1759 Theory of the Moral Sentiments.

. . . Nature has directed us to the greater part of these [desires] by original and immediate instincts. Hunger, thirst, the passion which unites the two sexes, the love of pleasure, and the dread of pain, prompt us to apply those means for their own sakes, and without any consideration of their tendency to those beneficent ends which the great Director of nature intended to produce by them.[31]

The notable, functional difference between the otherwise parallel sophistries of Quesnay and Smith, is that the variant proffered by Locke, Mandeville, and Smith, expresses the social characteristics of a Venice-style rentier-financier class's imperial maritime power; whereas, Quesnay leans quixotically to the inclinations of the Seventeenth Century's Anglo-Norman-French, pro-feudalist, Fronde tradition. Locke, Mandeville, and Smith, like William of Orange and Lord Shelburne, reflect the Venice-styled rentier-financier interest of those Dutch and British India Companies which employed such creatures as David Hume, Smith, Jeremy Bentham, Thomas Malthus, and the rest of the Eighteenth and Nineteenth Centuries' Haileybury economists. The distinction is that between the feudal landlord and the lords of the Venice-style Anglo-Dutch financier aristocracy.

There is no difference, however, in the preference of both types for the tradition of oligarchical models of society, in which a relatively small class of oligarchs, flanked by their retinues of lackeys, reign over, herd, breed, and cull the relevant inventory of persons degraded from human status, to that of human cattle. Such is the evil superstition inhering in today's rentier-financier notion of "shareholder-value society."

Modern Political Economy

The economic significance of the history which I have just summarized, is illustrated, rather well, by contemporary standard studies of the curve of population and of crucial demographic characteristics of those populations. The Fifteenth-Century, Italy-pivoted Renaissance, represents a qualitative improvement in the condition and future prospects of mankind, a quality of improvement without precedent in both earlier history and prehistoric human existence (Figure 3).

Therefore, it would be insanely reckless, to attempt to analyze post-Fourteenth Century, modern European history and its physical-economic development, except from the standpoint of identifying those new institutions and relationships which define the post-feudal form of modern sovereign nation-state, a form of nation which did not exist prior to the Fifteenth-Century Renaissance. In this perspective, the practice of the ideology of "free trade," especially when "free trade" is combined with "globalization," is shown to be a throw-back to that form of Venetian imperial rentier-financier power, usurious practices, and consequences, which plunged Europe into what historians call "The New Dark Age" of the Fourteenth Century.[32]

The struggle of Europe to free itself from the imperial legacies of ancient Rome and the Code of Diocletian, since St. Augustine and his followers generally, and since Alcuin and Charlemagne, Abelard of Paris, Alfonso Sabio, the Hohenstaufen emperors, and Dante Alighieri, was summarized in the work of the single greatest intellect of both the Fifteenth and Sixteenth Centuries, Cardinal Nicholas of Cusa.

Cusa, whose 600th birthday we celebrate this year, was the intellectual founder of the modern nation-state, and the founder of modern globally extended European experimental science. Merely exemplary of his contributions to all modern, and earlier civilization, are his Concordantia Catholica (the principle of a community of principle among modern sovereign nation-states), his ecumenical dialogue De Pace Fidei, and his initial treatise founding modern science, De Docta Ignorantia.

Such emphatically self-declared followers of Cusa as Luca Pacioli, Leonardo da Vinci, and Johannes Kepler, have attested to this. So does Cusa's leading position in organizing the campaign for those transoceanic missions which, among other things, led Christopher Columbus to rediscover the continent across the Atlantic.[33]

The principle of the sovereign nation-state republic, as typified by the expressed intent of the principal founders of the U.S. constitutional republic, as intended by such as England's Sir Thomas More earlier, is the dividing-line, which separates modern civilization from the relative bestiality of virtually all ancient and medieval history.

As to the history of the emergence of the modern sovereign nation-state, the essentials of the matter are summarized, chiefly, in three sources. Professor Friedrich Freiherr von der Heydte's Die Geburtsstunde des souveränen Staates,[34] my own numerous writings on this subject, and the review, delivered as her recent Bad Schwalbach address, by Helga Zepp-LaRouche, of von der Heydte's thesis from the standpoint of such later developments of the Fifteenth Century as the crucial role of Cusa.[35] The points of economic relevance to be stressed here, are the following.

The new form of society, the modern sovereign nation-state, has four outstanding features which distinguish it, as a system, from all predecessor and opposing forms of society. These four features define that form of society as a system, a system which is axiomatically distinct in its characteristic features from all other forms of society. It is the violation of those characteristics, most notably by the trends of the recent thirty-odd years, which has defined the U.S. and relevant international monetary-financial systems as the self-doomed system now gripped by its terminal collapse-phase.

The first characteristic feature of the sovereign nation-state republic, or community of principle among such nations, is that it outlaws the attempts of oligarchies to hold human beings in the status of virtual human cattle.[36] The first law of the modern form of sovereign nation-state, is that no government has the moral authority to govern, except as it is efficiently dedicated to promote the general welfare (the common good) of all of the people and their posterity. This is a principle of natural law, from which all legitimate constitutions and other law must turn, to prove and define their authority as law.

The state is not only obliged to adhere to this law in respect to its internal affairs, but also in its relations with other nations and peoples. It must promote the common good among nations and peoples, while defending the principle of perfect national sovereignty as an essential means for meeting the general obligation to the common good of humanity as a whole.

Second, it obliges the state to develop and maintain those forms of basic economic infrastructure on which the defense and improvement of the general welfare depend. The state may delegate such duties to non-governmental agencies, but the state may not lawfully relegate the authority in the matter to such agencies, and must hold those assigned agencies accountable for their fulfillment of their designated responsibilities on this account. This means such infrastructure as is needed to promote relevant improvements in the entirety of the area which the nation represents, and for the maintenance and improvement of the demographic characteristics and cognitive development of the entire population.

Third, the sovereign nation-state can not relinquish its unique sovereign monopoly of authority for creating and regulating its currency and public credit. This removes such monopolies and authorities from the hands of an active or incipient rentier-financier class.

Fourth, the state must promote the increase of the productive powers of labor through emphasis upon the benefits of scientific and technological progress, and the promotion of those forms of the arts which are essential for the promotion of those qualities of the individual human mind, and human cognitive relations, upon which the continuation of the benefits of scientific and technological progress depends.

These four principled features of the modern sovereign nation-state republic's constitutional composition, define an elementary conflict between competent forms of economic management, and today's generally accepted methods of financial accounting, and today's derivatives of the latter methods.

I now develop the implications of what has just been summarized, as follows.

Private Enterprise

The proper role of private enterprise in agriculture and manufacturing, and kindred undertakings, is located chiefly within the fourth of the just-stated categories of the nation's economic functions. Our focus upon that topic at this point in the report, returns our attention to the issues of cognition addressed within the preceding chapter.

The fact that cognition represents the third, and highest ranking of three principled forms of universal phase-space, is a modern discovery. Nonetheless, that fact was always a pre-existing, functional principle, doing its work, even while awaiting its belated discovery; it has functioned as a universal physical principle, whether it were consciously acknowledged, or not. Even without discovery of that principle, the efficiency of that principle was already reflected in the known evidence of certain crucial effects.

Already, since no later than the dialogues of Plato, there existed the notion of cognition, and of the ideas of principle it generates, and, also, a related conception which is sometimes called "the idea of progress," the idea of the possibility of choosing constant, willful change for the betterment of mankind's condition.

Among the crucial features of the process leading into the launching of what became the Fifteenth-Century Renaissance, as in the university in Padua at the close of the Fourteenth Century, was the role of what are called, in modern times, Classical humanist modes of education. Exemplary are the role of the Brothers of the Common Life, and the education of Cusa himself. Filippo Brunelleschi, who applied the physical principle of the catenary to solve what had been estimated as the impossible task of putting the required cupola on the Florence cathedral of Santa Maria del Fiore, typified that florescence of the creative scientific and artistic spirit which characterized the intellectual process of much more than a century (Figure 4). This is a process of preparation and realization which leads from the work of such as Dante Alighieri, Petrarch, and the Brothers of the Common Life. Cusa's founding of modern experimental physical science typifies this, as does Leonardo da Vinci, whose work bridges the span of the late Fifteenth to early Sixteenth Centuries. The outcome of these predecessors' work, as seen in the towering genius of Kepler, typifies this.

Throughout all now globally extended influences of European civilization, from Egypt, Pythagoras, Solon, and Plato, to the present time, globally extended modern European civilization has been underlain, and thus dominated by a continuing struggle for absolute supremacy between two principal, opposing, leading intellectual forces, the one most conveniently named Classical, and the other typified by the past 2,300 years of the opposing, Romantic, current. I now illustrate that point.

I resort again to music as an example. Contrast the Classical current of musical composition, that of J.S. Bach, Haydn, Mozart, Beethoven, Schubert, Brahms, et al., to the Romantic faction of Rameau, Fux, Liszt, Wagner, et al.

The non-deductive method of Bach, rooted in a well-tempered contrapuntal polyphony situated within a geometry defined by the principle of Florentine bel canto voice-training, contains nothing arbitrary in its process of development of compositions as wholes. All is based upon the principles of cognitive solutions for contrapuntal musical paradoxes of consonance. It is the resolution of such paradoxes, as the use of a series of Lydian intervals by Mozart and Beethoven, for example, which defines these compositions as products of human cognitive reason.

In contrast, the Romantic school of Rameau and his admirers, relies upon arbitrary production of what they seek as "pleasing effects," often resulting in a type of composition which suggests the principle of extrusion one might expect from a purchase of Germany's famous curry sausage. Romantic formalist Fux, of Gradus Ad Parnassum, achieves irrationality in a different way, through imposing arbitrary definitions, axioms, and postulates.

In Classical poetry and drama, the artist relies entirely upon ironies, especially crucial metaphors, which oblige the mind of the audience to produce cognitive solutions for such paradoxical features of the composition. The Romantic, as typified by Venice-trained Hobbes and his followers, relies upon the unresolved irrationalities of symbolism, as a disgusting substitute for irony and metaphor.

These same classes of distinctions are characteristic of the conflict between Romantics, such as Galileo, Newton, Euler, Lagrange, Laplace, and Cauchy, in mathematical physics, and Classical scientific method, as typified by Plato, Kepler, Leibniz, Gauss, Riemann, et al.

The crucial point of difference in each of these and comparable cases, is the reliance upon, or exclusion of the method of cognitive discoveries of principled solutions for the kinds of paradoxes which are the reflection of that principle of metaphor which is central to Classical methods of artistic composition, in poetry, drama, music, painting, sculpture, and architecture alike.

As I have repeatedly shown, in earlier locations, the term "universal physical principles," applies equally to the characteristic universal principles of, respectively, abiotic, life, and cognitive phase-spaces. As Vernadsky argued this much, a physical principle is one which is revealed experimentally by physical effects which occur only as a result of its implicit intention, that in the sense of Kepler's use of the notion of intention as corresponding to the efficiency of universal physical principles. Thus, inasmuch as Classical artistic principles enable society to achieve those increases in potential relative population-density of society which can be achieved in no other way, those artistic principles, and the notions of statecraft they imply, must be accepted as being universal physical principles in the same degree as universal physical principles of abiotic phase-space.

The proper function of private entrepreneurship, is rooted in the fact, that the power to create and apply cognitive discoveries of universal physical principle, is unique to the internal cognitive processes of the individual human mind.

As I have detailed this in earlier locations, the processes by which the notion of an hypothesis, and its corresponding universal physical principle, are generated, are opaque to the senses of a would-be external observer. The ontological paradox which prompts the cognitive discovery, is composed of sensible effects; the appropriate experimental verification of a universal physical hypothesis, as a proven principle, is composed of sensible effects. The action which connects that paradox to that proven hypothesis, can not be observed directly by the senses of an external observer.

The communication of the action of cognition, from one sovereign individual mind, to another, can occur only through the process of replication of the same three-fold experience in both minds. The act of communication of all classes of cognitive notions, which is to say of the nature and implications of universal physical principles, can occur only in this way.

This includes the transmission, to the living, of knowledge of discoveries by persons long deceased. The principle of practice of a Classical humanist mode in education, is an example of this connection across many successive generations. There are two commonly practiced, mutually antagonistic methods of instruction: one called learning, the other called cognition. Learning is a matter of conditioned behavior; knowledge is the result of reenacting the cognitive experience of discovery of verified universal and related principles. The substitution of learning for knowledge, in educational policy, is among the cruelest, most destructive follies of the practice of recent generations. I have used the example of today's student, in secondary education, re-experiencing of an original act of discovery of a universal principle by Archimedes, 2,300 years earlier, as an example of methods of transmission of knowledge, rather than mere learning.

The progress of the human species, its increased power in and over the universe in which it lives, is entirely the consequence of the historical accumulation of combined discovery and transmission of knowledge in the equivalent of a Classical humanist mode. Here lies the key to the essential contribution which private enterprise, as an institution, proffers to the economy of the well-ordered sovereign nation-state.

The most relevant illustration of that point, is provided by examining the normal functional relationship between the inclusion of a fundamental research function in the university system, and the transmission of universal physical principles to designs of products and improved processes of production by the mediation of the same machine-tool-design function which is essential to design of universal proof-of-principle experiments. This form of organization of society, as a science-driver economy, is implicit in all successful practice of modern economy to date, and provides the model around which all reforms of modern economy ought now to be premised.

The model of a most desired type of private entrepreneur is essentially a technological innovator. He, or she, is a scientist, an engineer, a machine-tool-design specialist, a modern high-technology farmer, or of similar qualifications. Sometimes, his commitment to innovation is called "risk," but the ordinary use of that term today is misleading. The most relevant form of "risk" in his or her endeavors, is the kind of intellectual risk expressed by society's best original discoverers of scientific and related principles: the commitment to risk the expenditure of the best adult years of one's life in making something work, to the implied benefit of mankind, which never worked before. It is that individual's qualification for taking that risk, combined with the passion which will not let him shirk what that intention demands of him, which is the mark of the qualified individual entrepreneur, or a small group of entrepreneurial individuals in a kind of symbiotic partnership.

This sort of agricultural, industrial, and kindred entrepreneurship and profession, is the active surface where progress is expressed to the benefit of the society within that surface. The other three principal components of the modern sovereign nation-state economy, 1.) The overriding commitment to promote the general welfare; 2.) The responsibility of the state for ensuring the development and maintenance of basic economic infrastructure; and, 3.) The monopoly of the state in the matter of the currency and supply of public credit, are the essential setting within which the essential role of the entrepreneur is situated. It is that arrangement among these four principal elements, which defines the viable form of modern nation-state economy.

The Public Corporation

Generally speaking, the spread of the lunatic cult of "shareholder value," has blinded current public opinion and governmental policy-shaping, to the functional difference between a corporate entity consistent with what Treasury Secretary Alexander Hamilton and other patriots defined as the "American System of political-economy," and the modern corporation controlled essentially by today's combined power of modern rentier-financier interest and its attached major law firms.

With rare exceptions, the crushing of the former role of the closely-held small to medium-sized entrepreneurship, by the rise of the giant financial-market-controlled industrial or other corporation, has been a cruel setback for the cause of the general welfare. However, the problem this expresses today, always expressed a parasitical political aspect of our national economy, from a time before the 1776 Declaration of Independence. The nature, and possibility that we might cure that problem, demands that we summarize the leading features of that aspect of our national history here.

From the period of the accession of the British tyrant William of Orange, the English colonies in North America were divided into two antagonistic currents. The reports by Cotton Mather typify this.[37] By 1763, when the Benjamin Franklin-led steps toward American independence were set into motion, the factional division within the future republic was already well defined, as Anton Chaitkin's Treason In America has documented the essentials of this history.[38]

Chaitkin, like Lowry defines the negative factional interest in U.S. political, economic, and cultural life, as what has been known, to the present day, as "The American Tory" faction. With the formation of the Democratic Party by the treasonous Aaron Burr's successor, Martin van Buren, the treason faction in U.S. life has been centered in an alliance among the nation's drug-trafficking partners of the British East India Company, the Manhattan-centered cabal of rentier-financier families, the Southern slaveholders, and such present-day continuations of the latter formation as the Nashville Agrarians.[39]

The patriotic faction, as organized by Benjamin Franklin, has been best typified by such Presidents as Washington, Monroe, John Quincy Adams, Lincoln, Garfield, McKinley, Franklin Roosevelt, and, briefly, Kennedy.[40]

Consequently, as President Franklin Roosevelt emphasized, from the beginning of U.S. independence, the nation and its institutions were a continuing battlefield, on which an ultimately mortal conflict between the patriotic and American Tory factions has been fought. Since the successful 1901 assassination of President William McKinley by an agent conduited through New York City's Henry Street Settlement House, the phenomenon of the Wall Street-centered, shareholder-owned public corporation, has become a creature controlled, top down, by the American Tory faction. Since the Presidencies of Grover Cleveland, Theodore Roosevelt, and Woodrow Wilson, and the campaign to establish the Federal Reserve System, the U.S. economy, and much of our Federal political institutions, have been controlled, most of the time, through the combination of financial houses of a rentier-financier character and their complements among the leading Establishment law firms of places such as New York and Washington, D.C.