Economics is often nicknamed “the dismal science”. However, although the “dismal” part may be well earned, much of mainstream contemporary economics has a pretty tenuous claim to be science.
Unless one defines the term broadly enough to include the likes of astrology, too.
Astrologers work from a bizarre starting point. First, they take the twelve constellations that mark the ecliptic, the plane the solar system orbits in, and assert that then Sun being in front of them, as seen from Earth, magically endows people and events with characteristics relating to the items and creatures those constellations coincidentally make rather contrived join-the-dots pictures of.. Then, they even out the differences in sizes to make twelve approximately equal signs. A bit of a fudge, that. Next, for an even bigger fudge, they wind back two millennia of precession, a very slow wobbling-top type secondary rotation of the Earth's own axis of rotation, and count the Sun as being where it would have seemed to be at a given season two thousand years ago. Then, they proceed to calculate horoscopes with great care and accuracy. For all their skill and expertise, though, on top of the very deep doubts any educated and thinking person must have about how the stars and planets could influence human affairs anyway, there is that total disconnect introduced by the fudges that completely vitiates the final results. Yet many people still put a lot of faith in the astrologers' conclusions and predictions.
Neo-liberal economists seem to have a remarkably similar approach. First, they take some of the ways in which buyers and sellers could act in a market and then they assume that everyone will always follow those behaviours; it would get too complex to calculate, if they did not. Then, to distinguish each expert's theory from all the other similar ones, they take a particularly random factor to emphasise. Then they create elaborate mathematical formulae with which they can make predictions with great care and accuracy. Once again, the fudging of the input data disconnects the calculations from the deeply unconvincing mechanisms they purport to measure, and the predictions fail as often as random guesses would. And, like astrology, the soothsayers' clients are far too impressed by the care and skill put into it all to question the fundamental validity of the process.
Now, internationally, we have elected a whole generation of credulous fools into power, nearly all of whom gullibly lap up the advice churned out by the naked emperors in the right-wing think-tanks. With their fancy formulae and opaque jargon, the latter bamboozle both hapless politicians and even themselves into believing their recommendations must work out in the forecast manner. Yet, the crucial questions about how they will actually work are casually swept aside, and discreetly covered over with the blanketing assurance that free markets theistically deliver miracles of perfection, if they are only left to get on with working their magic. Of course, the markets do not deliver their miracles, except by occasional pieces of random good luck, and why should they anyway?
I would not go so far as to claim that there is no use for the study of economics, and the application to practical politics. What I would contend, though, is that there is an urgent need for a resurgence of the old Keynesian school of economics, that starts with sound analysis of what really goes on, and demands that governments actively manipulate the economy to maximise desirable activity. As I write from the perspective of a small offshore island, with external trade dwarfing internal activity, I have to concede that little of the established Keynesian theory is properly applicable locally; Keynes and his followers having concerned themselves with the workings of Great Powers with immense domestic economies. However, we would benefit from the removal or re-education of the free-marketeers currently dominating our Council of Ministers, and should stand to gain from Keynesian reflation of the UK economy we are just a little side-loop on. I had to write “should”, not “would”, as one of the measures many of the leading Keynesians campaign for is a massive clampdown on tax leakage, and rather a lot of our local economic product is effectively commission on making tax leakage happen there, which would obviously backfire on us.
Anyway, neo-liberal economists are just the latest generation of the same kind of charlatans who were court astrologers for millenia, and no more deserving attention. Do not vote for any politician who seems to believe what he reads in their runes.
Norwegian deal, anyone?
8 hours ago