Monday, March 30, 2009

The Problem with Economists

Paul Krugman - America the Tarnished -

I like Paul Krugman in general, but this statement today shows everything that is wrong with economists:

Like many other economists, I’ve been revisiting the Great Depression, looking for lessons that might help us avoid a repeat performance. And one thing that stands out from the history of the early 1930s is the extent to which the world’s response to crisis was crippled by the inability of the world’s major economies to cooperate.

The complete ahistoricism is astounding. Economics must, at some level, be about the interaction between money AND peoples motivations, expectations, and experiences in life.

These are now all so different from, for example, the 1930s, that the only possible constant would have to be some notion of fiscal system or monetary exchange. Value and how we assign value are are all so different in sociological and psychological terms (even within select economies) that comparisons are pointless.

Economics is less a science than a way of talking about the past with some numbers thrown in.

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