To really misunderstand the purpose of an economy

Evgeny Morozov is one we have trouble understanding. He seems to have a remarkable ability to grasp the wrong end of that stick and then dress up misunderstandings in complex verbiage to no great end. Take this:

When Uber, Airbnb and similar platforms were young and tiny, it was easy to believe that a global revolution would liberate more informal economic activity. Out with professional drivers, limousines and hotels; in with amateurs, bicycles and shared couches!

It was an appealing vision, rooted in the countercultural rebellion against authority, hierarchy and expertise. That vision, however, lacked one thing: backing from political parties or social movements. Those parties, once in power, could have ensured that local platforms had adequate public funding not to be subject to the brutal laws of competition, protecting them from deep-pocketed commercial competitors.

When these new ways of doing things were just plucky little start ups they were great. But when they succeed somehow it all falls to pieces?

Which is to miss our point in having an economy at all. Our aim is that we all get to have the maximum possible of what we want. We wish to maximise human utility that is, given the resource constraints the universe imposes upon us. You know, that economics thing, the allocation of scarce resources.

So, imagine, we discover some new method of resource allocation, one which adds more to utility than earlier ones. Great, we’d like one of those scarce resources, capital, to pile in to provide more of those things which increase utility.

We even want to use the market economy, with its competition, so that we can find out which things do add to utility. Technology is always changing and the possible combinations of resources and methods to do whatevers with it. We thus need a sorting system for what does in fact increase utility.

A market economy does that sorting for us, as it also reallocates capital and other resources to those things which do that increasing utility thing. All of which is the very point of having an economy in the first place.

Apparently this is a disaster though, for some reason no one is really able to pinpoint. But, you know, why? Why is a system which makes us all as rich as we can be given reality out there a bad one?