What’s the deal with economics? Why is it significant? Why should the average folk have any care in the world for it? For starters, everyone has a home. And if you desire a properly managed planet, the home of all our homes, then you also desire a proper economic system. 

The word "economy" comes from two etymological roots: “eco-” and “-nomy”. “Eco-” comes from the Greek word “oikos” meaning house. “-Nomy” comes from the Greek word “nomos” or “nemein” meaning management, law, rules.

Economics is a lot more than the popular idea of it as a study and practice of money. It is a study and practice of the management and laws of all life, not only human life. We see this in a similar word with similar origins: Ecology.

The word "economy" is essentially the same as the word “ecology” except for the difference in their suffixes. The suffix “-ology” means "the study of." Ecology, similar to “economy” is the study of the household. Just as ecology studies all life, so too economics deals with all of life. It is only because we are humans that we use economics to manage human resources. Technically, however, economics can apply to all life on earth. In a broader sense, economics is the management of the world.

Thus far we have seen that etymologically, the economy is the management of the home (with the ultimate home being the world). Colloquially, the economy is the management of resources (or wealth, aka money). The etymological and colloquial meanings however, do not differentiate. The world is made up of resources, therefore, managing resources is managing the world, and vice versa. When you hear economics, don't just think about it as the management of resources or wealth, think about it as the management of the world.

While economics is the management of the world / resources, more specifically, economics is the management of a finite world and the scarcity of resources. 

Sal Khan of Khan Academy (backed by Google and MIT) teaches the following about economics in his Intro to Macroeconomics (in the module titled “Scarcity”) available in Khan Academy:

“The entire field of economics is based on the idea of scarcity, and arguably we wouldn't even need a field of economics if there wasn't the notion of scarcity in the world.” Elsewhere he mentions thus: “Victorian historian Thomas Carlyle once called economics the ‘dismal science’ because he believed it obsessively focused on the scarcity of resources.” (See the module: “Lesson Summary”)

Sal also mentions that “Scarcity is sometimes considered the basic problem of economics. Resources are scarce because we live in a world in which humans’ wants are infinite but the land, labor, and capital required to satisfy those wants are limited. This conflict between society’s unlimited wants and our limited resources means choices must be made when deciding how to allocate scarce resources.”

To understand the importance of economics we can simply open our eyes to the concept that economic systems are completely intertwined with governmental / political systems and can even be considered as governmental systems in their own right. 

The government governs the world, this includes not just resources or wealth, but also people. People are primarily involved in collaboration, creation, contribution, and consumption. These are economic activities. The majority of the weekday of any adult is (hopefully) work. Whether considered as such or not, the government mainly governs economics, with the government itself being a major player in global and local economies.

The two major economic systems, Capitalism and Socialism, can both be considered political systems in their own right. These economic systems dictate how governments operate at their most fundamental level.

Socialism is an economic system whereby resources are controlled by the government, (supposed to be) representing and serving the public's interests. Capitalism is an economic system whereby resources belong to private interests, and as such, trade is primarily left to natural forces (without any governmental intervention). However, even capitalism is entirely entwined with the government.

It can be said that the whole idea of capitalism is to reduce the meddling of governments in markets, yet even so, governments create the legal frameworks (property rights, regulations) and adjudications that sustain capitalist markets to begin with.

As well, while the government, which is just people, dictates the rules, everyone in the government also needs an income, and to ensure that those they govern have an income as well, and secure at that.

According to the Torah (from which Real Economics is derived) the government is akin to a mouth, using words to rule. An economy is akin to the entire body as a whole, with all its parts and their contributions to other parts of the body / economy. One part is contributing education (the brain, which educates the mouth), one part is contributing infrastructure (the bones and vascular system), etc., with the mouth playing its part to try to direct the body with internal sub-local speech (talking to oneself).

Without a body, what good is a mouth, and more so, what good is a mouth without the blood providing and powering it according to its needs. Blood in the Torah, is a metaphor for money itself, the main element of economics.

If we look at the state of global economies today, we can see that there are three basic forms of economies: command economies (run by the government), market economies (run by human nature), and mixed economies (a mix of the previous two). The reality however, is that while some economies are government controlled and some are more free, all economies are essentially mixed economies, just like a body.