Economics has failed us. Miserably | Hacker News Reader

Economics has failed us. Miserably

bostonreview.net

25 pointshuihuiilly5 comments

No, politicians abusing economists have failed the system. In each case a politician wants to accomplish x, they find an economist wanting to sell their soul by saying: x might be possible if y and z are held constant; but y and z are impossible to hold constant. Look no further than any administrations options:

1. Minimum wage, all economic 101 will tell you it does not work, yet, there is Krugman (who published a textbook stating it does not work) saying minimum wage can be raised with only a slight impact on the market.

2. Trade tariffs: they hurt downstream utilization, the aluminum prices increase has impacted the vehicle manufacturers in the US. Yet here we have the current administration saying: oh, it will work.

3. Rent control: it does nothing but gut the markets of rentable space, drives the landlords out of the market, and reduces available affordable housing. Yet, here is Oregon finding economists who say: maybe... it might work.

4. Cash for clunkers: it was a pull forward of purchases, any economist would shave told us that. In the end it just sucker punched the poor for seven years as all these used vehicles were removed from the market. Larry Summers selling this boondoggle never made sense.

What this shows is that the term economist is open ended with enough non science items being bantered about that cause these disasters in economics. Then when you call them out on their recommendations, they say it was not implemented with y and z implemented.

Paul Krugman and Barack Obama receiving Nobel prizes was the wake up call I needed to realize how many "honors" are actually the establishment rubber stamping their avatars.

I was also wondering how a Nobel prize and Krugman fit in one sentence every time I read his column in NYT. Now recently even the Swedish Academy had revealed corruption and petty politics between its members. Just have to learn to ruthlessly ignore any authorities, I guess.

To be fair, the Swedish Academy is only responsible for the literature prize. While the Academy has done some fantastic things (for example, Svenska Akademiens Ordbok) they have been a social club for the intellectual elite for a long time.

The economy prize (which isn't even a real Nobel prize) is given by the Swedish National Bank.

To be fair, Krugman's work on trade theory was deserving of the Econ pseudo-Nobel. He can be a very good economist when he isn't being politically partisan and making claims along the lines that those who disagree with him are bad people. Remember his blog was called "The Conscience of a Liberal" not "The Conscience of an Economist".

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