Monday, August 12, 2013

The Mind of an Economist

I have little love for economists. Mostly because they have foggy thinking processes, all too often driven by their political world view rather than any form of reality.

Take for example the comments of a left wing economists in the NY Times today. He states:

Rather than deal purposefully with this changing economic landscape with useful policies encouraging the growth of other industries, our government spent decades papering over the growing weaknesses by allowing the financial sector to run amok, creating “growth” based on bubbles. We didn’t just let the market run its course. We made an active choice to embrace short-term profits and large-scale inefficiency.

The first sentence is telling.  It effectively states that the Government should be the chooser of winners and loser in the market place, establishing policies to support winning economic and technological developments and enhancing their chance of success. Surprise, the Government has no single individual who can make such a choice. The Market does this.

In the real world, the entrepreneur comes up with an idea, seeks capital, starts a venture, brings it to market and if the dogs eat the dog food, he wins and so does society. If not he and his investors lose and start all over again. What Government can do is just get out of the way.

The source of many of our problems is Government getting in the way.

However another source of our problems is the classic Norbert Wiener warning that machines would replace people. Well, that was in 1948. This is 2013. Almost 70 years later. So why are we surprised.