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Comment by dismalaf | Hacker News Reader

Articles like this pop up a lot, and not just here. I took economics. On one hand, I did find my education to be very high quality, relevant, gave me a good understanding of the economy and all the principles are sound.

The problem with economics is that people and politicians either don't listen or want specific outcomes that aren't good for the economy as a whole.

Voters will always vote for handouts, not for a robust and sustainable economy for everyone. Rich people will always vote for things that increase inequality, because they're the beneficiaries. Homeowners will always vote to simply increase the value of their assets, after they bought them of course. And so on...

The only place anyone listens to economists is in banks and hedge funds. But then you're probably not creating the change that led you to consider economics in the first place...

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I only agree with the “will always vote” statements here if asterisked with “in aggregate, given the current socioeconomic incentive structures”

Maybe this is pedantic hair-splitting, but cultures and material conditions change… even human nature can change on long enough time scales. Maybe Humans will evolve into Bonobos.

What you are saying is understating the problem. Today's debt-based national economics allows people alive today to gain benefits while placing the resultant costs/restrictions on the people who are not yet born (or are currently children).

Debt-based economics is one of the biggest subversion of democracy. Decisions are being made for people who can't vote.

This comment is one of the things I refer to in my top-level comment. People have just enough of an education in economics and an understanding of personal finance and budgeting to be dangerous. They conflate economics with federal budget politics, have a one-sided and incomplete view of what debt is (especially US national debt), and then build a whole model of a system called "debt-based economics" which is based on political observations instead of fundamental economic understanding.

The problem isn't the concept of debt. The problem is people vote for the own interests ie. handouts and kicking the can down the road to the next generation. You can have debt in a society without accumulating more in perpetuity. Debt is a money multiplier and fine, never paying it off is the issue.

Indeed, debt is simply a tool that can be used in the good or bad ways. I think we agree that this tool is sometimes used poorly in general by countries, often because voters/politicians don't listen to prescriptions by economists.

What I am saying is that poor use of this tool leads to not only economic problems, but it is fundamentally at odds with democracy. If you vote to take on large debts that the future generation have to "pay" [1], you have taken away their democratic right, in a way that is distinct from other economic tools.

The current generation can vote to have low taxes or high taxes, but that doesn't have much impact (modulo infrastructure maintenance) on future generations ability to exercise their democratic rights.

Debt is unique in this regard.

[1] Pay in quotes because future generations might pay directly via taxes, or indirectly via higher inflation or by working hard to make gdp larger etc.

Debt is money is debt. You can't separate the two. What is "debt" at the state level of a sovereign state is just book debt, which is to say, numbers that balance the money creation. The real crime is paying interest on that "debt".

There was this one time economists were given almost free reign, and that ended screwing up most of South America.

https://en.wikipedia.org/wiki/Chicago_Boys

I'm not sure if economics education ever was very fit for any century.

Chile has the largest GDP per capita in South America among countries with more than 5 million people and is widely regarded as the healthiest South American economy. What point do you think you're making?

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