Blame Economists for the Mess We’re In • Hacker News Board

Re: Blame Economists for the Mess We’re In

#51

Post by cdbyr » Sun, Aug 25, 2019, 12:59 PM UTC

I think this misses the point and lets legislators off too easy. Economics tends to be concerned with maximizing the size of the pie, not distribution of benefits. That’s generally seen as government’s domain, with the idea that (with proper distribution) growth can genuinely make everyone better off. As it happens, legislators (and their appointees) seem to be willing to implement the growth-oriented ideas, but not the programs that retrain/etc people who lost out.

Tangentially, there are some nice lists out there of things economists do agree on - here is one of them: http://gregmankiw.blogspot.com/2009/02/news-flash-economists...

Re: Blame Economists for the Mess We’re In

#52

Post by gojomo » Sun, Aug 25, 2019, 1:00 PM UTC

gbacon wrote: post #37

gojomo wrote: post #8

Applebaum tries to finger "elfin libertarian" Milton Friedman as "the most important figure". But the specific policies he attributes to Friedman don't seem so bad: * end the draft, replace with well-paid all-volunteer military * let international exchange rates vary * evaluate regulations based on the cost-to-save-a-life Does Applebaum want to bring back the draft? Put exchange rates back under direct political cont…

Friedman’s worst idea that remains in vigorous implementation was automatic income tax withholding. He poured jet fuel into an engine of runaway state growth but is somehow remembered as a libertarian.

And look at the meager thanks Friedman gets from those like Applebaum craving ever-greater tax revenues!

Re: Blame Economists for the Mess We’re In

#53

Post by JumpCrisscross » Sun, Aug 25, 2019, 1:00 PM UTC

abhinai wrote: post #10

Blame no one. I sincerely doubt if humans truly understand economics. I mean we have the data for last 100 years. Maybe more. And everything we know today has been inferred from this data. But honestly, how do we know how economy is supposed to behave over a 20 year period in a world of high frequency trading, automated trading, disruptive technologies, globalization, ability to work remotely, a Continental currency…

> I sincerely doubt if humans truly understand economics

This exaggerates our ignorance. Microeconomics is well understood, down to producing testable hypotheses. In macroeconomics, we can draw broad lessons. We know, with respect to elected governments, economies with independent central banks outperform those with political ones. We know there is a relationship between interest rates, money supply and inflation, even if we can’t precisely predict it.

Macroeconomics is largely qualitative. It tells us directions, but not precisely. (Microeconomics is properly a science, offering a full set of experimental tools and falsifiable predictions.)

Re: Blame Economists for the Mess We’re In

#54

Post by Ozzie_osman » Sun, Aug 25, 2019, 1:01 PM UTC

trentnix wrote: post #42

We in the USA live in the most gilded time in history, partially thanks to free markets and all the reasons the author bemoans. All income levels experience a level of prosperity without equal. Our poor are obese, unemployment is low, and the access to career altering knowledge and skills has never been better. A dip in the economy is overdue yet here we are, still experiencing a historic period of growth and economi…

Poor being obese is not a sign of prosperity. There are many countries that are not prosperous at all with obesity problems. Obesity can be due to genetics, lack of access to healthy food or time for recreation, etc.

High unemployment doesn't mean much if real wages are dropping for most people and necessities like housing or Healthcare are becoming less affordable even for those employed.

I agree that there are people out there incentives to make things seem worse than they are, but I so think things are pretty bad.

Re: Blame Economists for the Mess We’re In

#55

Post by gbacon » Sun, Aug 25, 2019, 1:03 PM UTC

sprafa wrote: post #22

AshamedCaptain wrote: post #21

Earlier quoted context omitted.

If that was true, perhaps economists should put the "economics may be scientific, just not as reliable as you might expect" disclaimer in bolder letters.

Good economists do it. What makes you think economics is scientific? To be honest it seems to me we’re at the alchemy level of economics - basically we barely understand what we’re doing

Economics is scientific — and much more complicated than physical sciences because people are involved. If I drop a rock with a certain mass from a tower of a certain height, I can safely assume that my measurements of that one event are representative of all similar events in the future. Predicting based on observations of someone’s behavior today what he will do tomorrow is highly problematic because in a real sense the same individual tomorrow will be a different person.

Re: Blame Economists for the Mess We’re In

#56

Post by jcfrei » Sun, Aug 25, 2019, 1:05 PM UTC

TheOtherHobbes wrote: post #38

sprafa wrote: post #22

Earlier quoted context omitted.

Good economists do it. What makes you think economics is scientific? To be honest it seems to me we’re at the alchemy level of economics - basically we barely understand what we’re doing

Nothing makes me think economics is scientific. But it's taught as if it's a science, handled inside academia as if it's a science, and has more influence on policy than hard science does. If it's not a science, those three facts are rather curious.

Whether something is a science or not depends on the methods which are applied - not how much is known about the subject. You could argue that biology is not a science because we don't understand how lots of basic cell functions work.

Re: Blame Economists for the Mess We’re In

#57

Post by klez » Sun, Aug 25, 2019, 1:12 PM UTC

tomrod wrote: post #45

colek42 wrote: post #35

Earlier quoted context omitted.

What specific kind of military do you get? The US military I was a part of was the most diverse group of men and women I have ever worked with in just any metric you can find.

I believe parent commentator was making a claim to lack of philosophical diversity, and that a voluntary military is more prone to prefer war over diplomacy. I see the margin the parent commentator is trying to make, but feel it misses people who join the military to obtain gainful employment, get education, or numerous other reasons.

> but feel it misses people who join the military to obtain gainful employment, get education, or numerous other reasons.

You're right. But I wonder what kind of "politics" they would adopt when needed if they didn't feel the rest of the army has one way of thinking.

Re: Blame Economists for the Mess We’re In

#58

Post by samsonradu » Sun, Aug 25, 2019, 1:12 PM UTC

patientplatypus wrote: post #50

From 08-10 I was a flunky analyst at the federal reserve. First job out of undergrad and the first w2 I ever took home. The most important thing I learned is that the people in charge don’t know what they’re doing. The second most important thing I learned is that the same people will claim they do for money.

Some scary comments right here.

Re: Blame Economists for the Mess We’re In

#59

Post by klez » Sun, Aug 25, 2019, 1:13 PM UTC

cptskippy wrote: post #43

klez wrote: post #14

Earlier quoted context omitted.

There are reasons the draft can be a good idea. When the military is only voluntary you get a military with specific ideas about foreign policy and how you see the enemy, whoever they are. If you introduce the draft you have a more heterogenous military.

Yes that's all true at the bottom. The top is still career military and they very much set the culture, tone, and policy.

Yes, but they don't hold the rifle, in case it matters.

Re: Blame Economists for the Mess We’re In

#60

Post by dcolkitt » Sun, Aug 25, 2019, 1:17 PM UTC

For those who believe that economics has never done anything useful or benefits the common man, here's a small counterclaim.

The widespread adoption of index funds was absolutely an outgrowth of academic financial economics. In particular the efficient market hypothesis and CAPM theories, as well as empirical research studying the (lack of) performance of active investment managers.

In the US alone, index funds now make up more than $3 trillion of assets. That's saving investors more than $30 billion in wasteful fees every single year. (Which doesn't even account for the downward pressure on fees for active funds.) Moreover this revolution has benefited ordinary and small investors the most.