VOLUME III, SEMESTER 2, CHAPTER 24, SECTION 1
Why a Thing Has a Price
The ten chapters before spoke of positions, of accounts, of the card, of hide and hair, of chains, of the rule, of that force, of the two frames. Yet there is a bottommost question walked around all along, never once asked to its face. This section sets it out: a thing, by what does it have a price? This question is small as an empty saying, and the answer is the board of this whole game of chess. See the board clear, and the three moves behind are then understood.
One. Ask two things first
Set two things on the table: a cup of water, a diamond. Now ask: which is the more useful? This needs no thinking. Three days without water and a person is gone, a whole life without a diamond and a person lives just fine. Water is far the more useful.
Then ask one more line: which is the dearer? The diamond. Dear by a difference of tens of thousands of times. So the question comes: why is the most useful one the cheapest, and the most useless one the dearest? This question, in the economics of the West, is taken for a hard riddle, turned over and over for two hundred years and more, and it has a decent-sounding name, the riddle of water and diamond.
Two. The ancestors answered it in one line, two thousand years ago
This riddle, the ancestors answered, answered early, answered in four characters only.
A thing is dear for being scarce, runs the old line. This line has been heard since small, heard too familiar, so familiar that no one ever stops to see clear what it actually says. What it says is: the dearness does not grow out of the usefulness, the dearness grows out of the scarcity.
Look back at that cup of water. Water is useful, yet water is many: a cup here, a cup there, a river in the channel, and what falls from the sky is more. Water is many, so water is cheap. That diamond has almost no use, yet it is few. Few, so it is dear. This line sets out precisely the position of this whole volume.
Three. Take these four characters apart
Take these four characters apart one by one. The thing is that thing, the dear is its price, and the character in the middle is the bone of the whole line: scarce. Notice, scarce is not the temper of the thing itself. A cup of water does not itself know it is many, a diamond does not itself know it is few.
Scarce is a relation. It is a relation between two things, how much there is and how many want it: many who have and few who want, and it is not scarce, many who want and few who have, and it is scarce. See this layer clear: the dearness never grows on the thing itself, it grows on this relation.
Four. This is what that rule measures
Speaking to here, ask back that rule of chapter twenty. Guanzi said the market is the standard of goods, the market is a rule. Back then it was said this rule measures how much a thing is worth. Today go one layer deeper: this rule measures, in truth, the scarce. Few who can, many who want, and the degree is high, many who can, few who want, and the degree is low.
Set this layer onto those three people of chapter seventeen. Why did Cook Ding leave Lord Wenhui struck dumb? Because a cook who could cut like that, there was only him. Why did Zi Qing keep the Marquis of Lu waiting seven days at the door? Because a carpenter who could make that stand, there was only him. That person called the hired emperor, why did the board sit through the night? Because they could not find a second. The root of the three people is one and the same character.
Five. Scarcity is no bad thing, it was a good rule to begin with
Speaking to here, a discomfort may rise in the heart: put so, then people and things are both priced by the few? Is that not cold? Press this breath down. Scarcity is no bad thing, it was a most usable rule to begin with. Look at what it does.
A place is short of salt, and salt is dear, and salt grown dear, the ones who make salt are more, the ones who haul salt run toward there, and the runners grown many, salt is no longer short, and the price comes down too. See clear: this rule does a matter as great as heaven, it translates the matter of where is short into a number, and this number out, people and things flow of themselves toward that gap. No one commands it, it is that scarcity calling them over. The last chapter spoke of that differential, today it must be said: under that differential is these two characters.
Six. What this section set, crossing to the next
This section set out the board. A cup of water, a diamond, the most useful the cheapest, the most useless the dearest. This problem, the ancestors answered in four characters: a thing is dear for being scarce. The dearness does not grow on the thing, it grows on the relation between how much there is and how many want it. What that rule measures, said to the bottom, is these two characters. Cook Ding, Zi Qing, the hired emperor, the root of the three is one: they could not find a second.
Scarcity is no bad thing, it is a good rule, it translates where is short into a number, and people and things flow of themselves toward that gap. This section could close here. Yet leave one question, and this question is the hook of the next section, and the switch for everything behind in this whole chapter. Think a moment: this rule, since it is set out of the many and the few, then, what if someone lifts a hand and goes to change that few? If a thing that was not scarce, someone has a way to make scarce, what then?
Credit to the ancestors; the mistakes are mine: Tiger Lyon.