A quantity which is imagined to be “infinitely small” (that is, smaller than any quantity which you can specify) and yet still not zero! Although this notion is rather obviously incoherent and thus quite illogical (as well as being an idealist philosophical notion), it is a curious fact that this very half-baked concept was rather successfully used for a couple centuries to initially establish the important new branch of mathematics we now call the differential and integral calculus. All talk of “infinitesimals” in mathematics, at least by serious mathematicians, disappeared when the concept of a mathematical limit was created and fully clarified. (See also below.)
Another name for the differential and integral calculus in mathematics. This name arose very early in the history of the development of the calculus when its rational logical foundations (centered around the concept of a limit) were as yet unknown. The attempt was therefore made to characterize calculus as the manipulation of “infinitely small” but still non-zero quantities. The concept of the “infinitesimal” is now recognized full well to be logically incoherent, but the name “infinitesimal calculus” is still sometimes used for historical reasons. It would be best if that term were now completely abandoned as the historical and outmoded intellectical relic that it is.
The general rise in prices of goods and services. Inflation is most often caused by the expansion of the money supply in an economy faster than the rate of expansion of the economy itself (i.e., faster than the rate of growth of production). Thus if the government runs large budget deficits and pays for them not by borrowing from other countries or from the rich within its own country, but simply by printing up more money, inflation will inevitably develop.
Most modern capitalist countries actually purposely plan for a low rate of inflation (rather than stable prices) because they believe this will spur economic growth. Inflation does have the effect of gradually wiping out debts, so it can in fact have this result to a degree and to the extent that further growth is limited by already excessive debt.
See also: CONSUMER PRICE INDEX, DEFLATION, HYPERINFLATION, REFLATION, STAGFLATION
INFLATION TARGETING [Bourgeois Economic Policy]
A strategy by a central bank or other authorities in charge of a capitalist economy in which some definite target rate for inflation is set, and monetary and other measures are frequently adjusted in an attempt to stay within a narrow band around that level of inflation. The alternative ad hoc approach to monetary policy has been more common in the past. “Inflation targeting” assumes that short-term forecasts of inflation rates will be accurate, which is often far from true. In any case, inflation targeting will at most only work as a fine tuning measure, and cannot possibly eliminate the industrial cycle in capitalist economies nor resolve major crises.
This is a common phenomenon in the modern world, especially since the widespread availability of TV, computers and the Internet. The central difficulty with “information overload” is that the great preponderance of the information that many people are being swamped with is just not very important, reliable or useful. Worse yet, excessive attention to relatively unimportant information can distract people from acquiring the most essential information. One way that this happens is that people spend a lot of time “surfing the Internet” for what are actually relatively trivial and transient facts and off-the-cuff opinions, while not putting in any serious effort to acquire the scientific theories and perspectives that would allow them to properly evaluate those facts and opinions. This results in a “dumbing down” of people’s understanding of what is going on in the world and their ability to deal with it. This is a problem for society in general, but it is especially so for young people who are the ones most prone to spend so much time “texting”, visiting social networking sites and otherwise surfing the Web, etc., and so little time reading serious books these days.
This is also becoming a serious problem in the culture of the revolutionary left. Much more attention needs to be given to having formal study groups and to serious study of revolutionary theory, especially the works of Marx, Engels, Lenin and Mao.
INNOVATION-ONLY ECONOMIC MODEL
The bizarre theory of many American bourgeois economists that it no longer matters that manufactoring is rapidly declining in the U.S. and shifting overseas, because supposedly most of the world’s innovation and new ideas are still happening in the U.S. In reality, innovation, and ideas for new or improved products, also soon shift to the new manufacturing centers.
“That innovation should always follow manufacturing is hardly surprising.
After all, manufacturers conduct 70 percent of all R&D [research and development] in the
United States. So what do we think will happen to all that R&D when those manufacturers
“The offshoring of innovation has resulted in a sharp decline in overall R&D intensity in the United States—the percentage of gross domestic product devoted to R&D—relative to the rest of the world. We once had the most R&D-intensive economy in the world. Now we’re eighth.” —Henry R. Nothhaft, a U.S. “entrepreneur” capitalist, lamenting the relative decline in R&D and innovation in the U.S., “U.S. Outsourcing Prosperity”, San Francisco Chronicle, May 22, 2011, p. F7.
The buying or selling of stocks or other financial securities by those with “inside knowledge” of the decisions being made by capitalist corporations which will affect the prices of those shares of stock or securities. In capitalist financial theory every buyer or seller is supposed to be allowed equal access to this information (through public publication) before anyone is legally allowed to make use of it to buy or sell, though fully honoring this law is probably actually something of a rarity! Occasionally some blatant case of insider trading is prosecuted. Insider trading is yet another method whereby some financial capitalists cheat the others.
“In a broad sense there are no insoluble problems, but only those which, arising from a vague feeling, are not yet suitably expressed.” —Carl Boyer, The History of the Calculus and Its Conceptual Development (NY: Dover, 1959 (1949)), p. 25, expressing an idea credited to Fedrigo Enriques, Problems of Science (1929), p. 5.
Having liabilities greater than the current reasonable market value of all assets. In other words, a company or bank is insovent if it does not have enough money either on hand, or else which it can raise in short order by selling assets, to cover its liabilities to both shareholders and those to whom it owes money (including depositors in the case of banks).
See also: ZOMBIES
A specific moment (or “point”) in time. This is an important mathematical abstraction which has also become part of the conceptual machinery of virtually every human being.
“In contrasting average speed with instantaneous speed we have implicitly utilized a distinction between interval and instant, which is vital for what follows. An average speed is one that concerns what happens over an interval of time—3 hours, 5 seconds, one half second, and so forth. The interval may be small or large, but it does represent the passage of a definite amount of time. We use the word instant, however, to state the fact that something happens so fast that no time elapses. The event is momentary. When we say, for example, that it is 3 o’clock, we refer to an instant, a precise moment. If the lapse of time is pictured by length along a line, then an interval is represented by a line segment, whereas an instant corresponds to a point. The notion of an instant, although it is also used in everyday life, is strictly a mathematical idealization.” —Morris Kline, Calculus: An Intuitive and Physical Approach, 2nd ed. (Dover, 1998 (1977)), p. 17.
The limit value of a series of average velocities as one calculates them for ever-smaller periods approaching a single instant or “point in time”. Although people seem to have an intuitive feel for the notion of an instantaneous velocity, it is actually quite a sophisticated concept when worked out with logical rigor.
“[T]he derivative f '(t) of the distance function f(t), [is] the instantaneous velocity of the body. It is to be borne in mind, however, that this is not a velocity in the ordinary sense and has no counterpart in the world of nature, in which there can be no motion without a change of position. The instantaneous velocity as thus defined is not the division of a time interval into a distance interval, howsoever much the conventional notation ds/dt = f '(t) may suggest a ratio. This symbolism, although remarkably serviceable in the carrying out of the operations of the calculus, will be found to have resulted from misapprehension on the part of Leibniz as to the logical basis of the calculus.” —Carl B. Boyer, The History of the Calculus and Its Conceptual Development (1959), pp. 7-8.
INSTRUMENTS OF PRODUCTION
The tools, machinery and technology used in economic production. This category is part of the means of production (which also includes raw materials, land, buildings, etc.).
See: INTRINSIC GOOD
1. [In the philosophy of mind:] The view that mind and mental phenomena (such as thoughts, ideas, memories, hopes, etc.) are merely “convenient fictions” which do not really objectively exist. Thus instrumentalism in this sense is a type of naïve materialism similar to eliminative materialism. But whereas that theory claims mentalistic terms can and should be dispensed with entirely, instrumentalism admits that mentalistic terminology is indispensable in our everyday vocabulary for describing, explaining and predicting human behavior—even though (supposedly!) minds, ideas, memories, and other mental things “don’t really exist”. (Yes; it’s an utterly ridiculous theory. It fails to recognize that mentalistic terms are not only necessary but are entirely valid high-level summaries of states of the functioning physical brain in its tremendous neuronal complexity.)
2. [In ethics:] A term used to denigrate interest-based, utility-based and similar naturalistic theories of ethics by their (usually Kantian) idealist opponents.
3. [In the philosophy of John Dewey:] The view that concepts and theories are merely “instruments” or tools for dealing with a situation, which cannot genuinely reflect the underlying reality, and cannot really be considered true or false. Hence, a subjective idealist doctrine fully in tune with the pragmatist spirit.
In recent years the RCPUSA and those who have been around it have used the term in something like this third sense, though often expressed more vaguely or crudely, as in Bob Avakian’s comment: “By ‘instrumentalism’ here I mean torturing reality in the attempt to make a distorted version of reality an instrument of certain aims.” [“Bringing Forward Another Way”, Fall 2006, online at: http://revcom.us/avakian/anotherway/index.htm] Mike Ely, among others, has pointed out that Avakian himself “both condemns and practices instrumentalism”, and uses the method of “manipulating people by fudging the truth” such as by putting forward apocalyptic predictions of imminent revolution in the U.S., imminent Christian fascism, and the like, which surely Avakian must have known were not actually true or reasonable.
Insurance is simply a socially-approved-of form of gambling, wherein the person or company taking out the insurance bets that something bad will happen, and the insurance company bets that it won’t. When you buy fire insurance on your house, for example, you are betting that the house will catch fire someday, and the insurance company is betting that it won’t. For you, that is indeed gambling, because it is impossible to be sure whether or not your house will catch fire. But it is a gamble that makes sense because if your house does catch fire, at least you will receive a large payment from the insurance company that will hopefully allow you to repair the damage or else build a new house. If your house never catches fire, then you will still be out the premiums you paid to the insurance company; but, either way, you will not have suffered a catastropic loss. That is why insurance is often a good idea for the person buying it; it eliminates (or at least reduces) their risk of any catastrophic loss.
While buying insurance is a form of gambling for the person buying the insurance, interestingly it is not really that much of a gamble for the insurance company! This is because while the odds of your particular house catching fire someday are unknown, and probably unknowable, the total number of houses of your type catching fire in your region of the country over the course of an average year is a quite stable and easily ascertainable statistical figure. If the insurance company insures a large enough number of houses it will have a very good idea of the total insurance payments it will have to pay out each year. For them it is not much of a gamble at all; it is actuarial science.
“An insurance company, sanely directed, and making scores of thousands of bets, is not gambling at all; it knows with sufficient accuracy at what age its clients will die, how many of their houses will be burnt every year, how often their houses will by broken into by burglars..., how much they will suffer from illness or unemployment, and what births and deaths will cost them: in short, what will happen to every thousand or ten thousand or a million people even when the company cannot tell what will happen to any individual among them.” —George Bernard Shaw, “The Vice of Gambling and the Virtue of Insurance”, in James R. Newman, The World of Mathematics, vol. 3, 1956, p. 1527.
Insurance, therefore, is a way of socializing risk, of equalizing it across the population
of insured people. While this can be done in a half-assed fashion via private insurance
companies, this is not at all the best way to do it. First, the insurance companies demand to
make a profit, which is always absurdly large (and much of which is under the table, in the
form of huge salaries and stock benefits for the top managers, for example). Second, they
must compete with other insurance companies, which leads to huge marketing operations, vast
expenditures for advertising, and so forth. All of this is tremendously wasteful and greatly
raises insurance premiums beyond what they would otherwise be. On top of this, private
insurance companies regularly try to use all sorts of means to cheat claimants out of the
payments due them. (I.e., they are often guilty of various forms of fraud.)
Clearly, the best way of socializing risk, and for all the people, is through a socialist government insurance program. It can create an immense saving of labor in the administration of this insurance, by having only one insurance agency, rather than dozens of competing companies. It can insure at the actual cost of insuring, and not the bloated prices required by private profits and massive advertising. The administration of insurance benefits can be streamlined, and there will no longer be any reason to try to cheat people out of benefits that are due them. Here, as in every other area, socialism/communism is necessary to run an insurance system that really serves the interests of the people.
INSURANCE DEATH SPIRAL
A situation where an insurance company (or segment of the insurance industry) begins to lose those of its customers who are least likely to file claims, leaving the company with a higher proportion of policy holders who do file claims, which in turn forces them to raise their rates, which then leads to the loss of more customers in a vicious feedback loop.
An insurance company or segment of the industry (such as fire insurance or health insurance) normally insures a wide cross-section of the public, that is, something close to a representative section of the public. Thus if 4% of all the families in a country have a major health problem in an average year, and the health insurance industry pays out major claims to 4% of their policy holders during the year, their policy holders may be deemed a representative section of the population. The rates the health insurance industry sets are based on their expectations of the rate of payout. But suppose economic hard times come along (as they often do under capitalism), and more and more of those who are in generally good health decide they have to drop their health insurance because they just can no longer afford to pay the premiums. In this case the insurance companies will be paying out claims on a greater percentage of policies and will have to raise their rates. This will force more people to drop their health insurance, which once again leads to higher premiums.
This situation has actually developed in the health insurance industry in the U.S. at the present time (early 2010), with sudden huge premium increases being demanded by the insurance companies. They really do not want to raise their rates just now because that might lead to more support for a national health care plan which these insurance companies strongly oppose. But to keep their profits up, most of them are now raising their rates anyway. (This is another example of how the interests of an individual capitalist company often trump the interests of the whole industry or the interests of the capitalist class as a whole!)
In a genuine socialist society there could be no such thing as an insurance death spiral, since every person would automatically be covered by reasonable health insurance and other forms of insurance. The insurance coverage would automatically be “representative” of the whole population, since it would include the whole population.
[To be added...]
See also: LEVÉE EN MASSE
Generally this is a term of abuse used against Lenin’s basic strategy of revolution (the “October Road”) by those who reject that strategy and instead favor urban guerrilla warfare and the supposed universal applicability of the strategy of protracted people’s war to all countries, regardless of their very different circumstances.
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