26 September 2017 – 26 March 2018
Alan Jay Levinovitz recently put forth the provocative argument that economics is The New Astrology. …
The failure of the field to predict the 2008 crisis has also been well-documented. In 2003, for example, only five years before the Great Recession, the Nobel Laureate Robert E. Lucas Jr told the American Economic Association that “macroeconomics … has succeeded: its central problem of depression prevention has been solved.” Short-term predictions fair little better — in April 2014, for instance, a survey of 67 economists yielded 100 per cent consensus: interest rates would rise over the next six months. Instead, they fell. A lot.
… It appears that Levinovitz hasn’t quite grasped the full consequences of the argument he has espoused; namely that because economics models are mostly useless and cannot predict the future with any sort of certainty, then centrally directing an economy would be effectively like flying blind. The failure of economic models to pan out is simply more proof of the pretense of knowledge. And it’s not more knowledge that we need, it’s more humility. The humility to know that “wise” bureaucrats are not the best at directing a market — market participants themselves are.
Economists Are the New Astrologers
Mises Wire (28 August 2017)
My longtime friend and colleague Dr Thomas Sowell says, “It takes considerable knowledge just to realize the extent of your own ignorance.” Nobel laureate Friedrich August von Hayek admonished, “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” The fact that we have gross ignorance about how the world operates is ignored by the know-it-all elites who seek to control our lives. …
Think about this morning’s breakfast. Let’s suppose you and your spouse each had four slices of bacon and two eggs. You had coffee, and your spouse had cocoa. The breakfast might have cost you $22. But what might it have cost you if instead of being dependent upon others, you … produced your own breakfast? … One thing that’s guaranteed is that your breakfast would be far costlier than in the case where you depended upon the benefits of skills of others that emerge from the division of labour and trade.
The bottom line is that each of us is grossly ignorant about the world in which we live. Nothing’s wrong with that ignorance, but we are stupid if we believe that a politician can produce a better life than that which is obtained through peaceable, voluntary exchange with our fellow man anywhere on earth.
Walter E. Williams
Ignorance versus Stupidity (9 November 9 2017)
Universities are encountering “a tide of community and political hostility,” according to the chief executive of the Group of Eight, representing leading Australian universities. Vicki Thomson told a conference in Shanghai on Tuesday that “the more available to the community a university education in Australia has become, the less the community has trusted us.”
… Ms Thomson noted that universities in other Western countries faced the same problem, with British Environment Minister Michael Gove saying “people in the country have had enough of experts.” In the U.S., she said, the Pew Research Centre found that 58% of Republicans and Republican-leaning independents believed colleges and universities had a negative effect on the country.
Unis Face “Tide of Hostility” and Loss of Trust
The Australian (8 November 2017)
The Bourgeois Manifesto
What ails the U.S.? According to Amy Wax and Larry Alexander (Paying the Price for Breakdown of the Country’s Bourgeois Culture, The Philadelphia Inquirer, 9 August 2017),
Too few Americans are qualified for the jobs available. Male working-age labour-force participation is at Depression-era lows. Opioid abuse is widespread. Homicidal violence plagues inner cities. Almost half of all children are born out of wedlock, and even more are raised by single mothers. Many college students lack basic skills, and high school students rank below those from two dozen other countries.
They might have added that almost 80% of American workers subsist from one paycheque to the next, the U.S. Government has long been broke and it’s now in worse fiscal shape than any developed nation (see also this). As in matters economic and military, so too in social disorders: the U.S. is the Western world’s leader – and to various extents Australia, Britain, Canada, etc., are compliant followers. What underlies these plagues? Wax and Alexander reckon that
The causes of these phenomena are multiple and complex, but implicated in these and other maladies is the breakdown of … bourgeois culture. That culture laid out the script we all were supposed to follow: Get married before you have children and strive to stay married for their sake. Get the education you need for gainful employment, work hard, and avoid idleness. Go the extra mile for your employer or client. … Be neighbourly, civic-minded, and charitable. Avoid coarse language in public. … Eschew substance abuse and crime.
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