Hacker News Reader

Comment by ryanwaggoner | Hacker News Reader

This is perhaps the most poorly-thought out post on economics I've read in a long time. Adams is essentially arguing for a completely unrealistic set of draconian regulations to manage every aspect of society, from capital investment to personal health. An example:

"Stock bubbles could be avoided by restricting how much money can be invested in stocks, on an annual basis, to keep the price earnings ratios around 15."

Err...what? Who decided 15 was the ideal? What about those companies that clearly don't deserve that multiple based on their growth prospects, or companies that clearly deserve more? Why bother with a market at all?

He asserts that it's not socialism, but I'm having a hard time seeing how it wouldn't be worse.

View on HN

I agree. He starts off making some good points outlining the vulnerabilities of our economy due to our capitalistic ways. Then he talks about the most ridiculous predictions for the future of the economy, workforce and government regulations. I don’t believe we’re going to be seeing the type of restrictions Scott Adams claims, it would kill America. The only valid prediction he makes is the stronger credit requirements banks might impose but he backs it up as if it was because we were spending too much.

What stood out to me as completely ridiculous: “Depending on how bad the economy gets, you could also see rules banning single passengers in cars.”

You don't believe we're stupid enough to kill America?

What were you expecting from a cartoonist?

Cartoonists are good at finding the flaws in the current system but not really finding ways to fix them.

So looking for some more reasonable ideas to address his concerns: There are already limits on the kinds of investments low net worth individuals can make and quite possible some for of useary law limiting interest to ~20 - 30% which would cut down how much credit people can get and reduce there payments at the same time. A few changes to how people can invest their 401k's so they need some reasonable P/E and diversification if they have less than say 200k and are over 55 might not be a bad idea.

I think most of what he is complaining would be addressed with those changes and something like them might even become law but we would still have capitalism. Because capitalism is about having markets determine price which would still happen based on the actions of people with more money.

Furthermore, what were you expecting from a guy who defended Intelligent Design not so long ago?

Granted, Scott Adams does have an Economics degree and an MBA, but it is much more convincing (and productive) to attack his arguments rather than his qualifications or credentials.

To be fair, at the end he states that he's not advocating this plan, but that it's what he thinks will happen as people overreact to the economic crisis.

It's a pretty common for anyone who is not at least a casual student of Economics to think a magic wand should be waved to make people prudent, kind, and just.

If I could offer Scott one Economics paper, it would be Hayek's "The Use of Knowledge in Society", found online here:

http://www.econlib.org/library/Essays/hykKnw1.html

I think it would help him appreciate the complexity of the coordination problem that is addressed by decentralized means in the market.

The sad thing is, as simplistic as Scott's analysis is, it is probably much more sophisticated than the opinion of the average voter, who is ready to believe whatever an authority tells him.

Reply on news.ycombinator.com