Wednesday, 2 March 2005

Need your head examined?

Good. I quite fancy doing a bit of amateur brain surgery. I 'm not actually a qualified surgeon - in fact I have no training at all in medicine but, hey, why should that matter?

What I'm getting at is this: if we tend not to trust the medical opinions of people who've never studied medicine, why should we assume that everyone understands economics? You see, economics is quite a tricky subject and a lot of its insights are counter-intuitive. But almost every day we read nonsense like this in the papers. It comes from laymen, politicians, columnists, and even from people who have studied what passes for economics in universities these days but which is really the preaching of socialism.

Mr Hartney writes:

Only the Scottish Socialist Party wants to tax wealthy companies to provide the funds for essential public services.

The figures of big company profits show how easy it would be to put a fraction of that cash to work for the common good instead of private greed.

Contrary to what Mr Hartney thinks, free market economics is not a "dogma", but a rationally thought out set of principles.

Some of us, including myself, were rather shocked to learn that the Royal Bank of Scotland has a greater market capitalisation than Ford, General Motors, Nike and McDonald's put together. That's something we should be pleased about. Stealing the bank's profits would not benefit the "common good" but merely drive wealth-creators out of Scotland.

1 comment:

David Farrer said...

Comments made on previous template:

Neil Craig
Fair point Mark. Computer modeling should help but such models are only as good as their assumptions - as global warmers are proving.

11 March 2005, 19:59:50 GMT
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markm
Economics suffers as a science from the impossibility of doing controlled experiments. A single human metabolism is probably more complex than the world's economy - but it's not that hard to get enough test subjects to average out individual differences and measure the effect of a treatment.

6 March 2005, 20:59:55 GMT
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Andrew Duffin
Phil Hunt, I cannot agree with your suggestion. Can you imagine what sort of Economic theory the EIS would teach? I think I can...

3 March 2005, 12:18:12 GMT
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Phil Hunt
What I'm getting at is this: if we tend not to trust the medical opinions of people who've never studied medicine, why should we assume that everyone understands economics? 
 
That's a good point. But everyone handles money every day, and many do jobs, so that gives them some insight into how money and the economy work. 
 
It would probably be best is econopmics was a compulsory subject in school; this would tend to raise the tone of political debate.

3 March 2005, 00:48:05 GMT
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Neil Craig
I don't think the comparison works. If I thought that economists had a fraction as much understanding of economics as brain surgeons have of the hardware of brain surgery I would happily let them & the government get on with it & get on with my own business in a world of 15% annual growth (at least). 
 
I'm not sure if this is because economics is intrinsically more complicated than brain surgery or that those with political influence (like the letter writer & some on the right) produce a climate where the scientific method cannot be used. Probably both.

2 March 2005, 19:01:58 GMT