Economists Can Be Pretty Stupid

Economics, we are told, is a science, so economists, by extension, must be scientists.


Does anyone – other than economists, who appear to be enamored of thinking of themselves as scientists – actually believe this?

Despite what economists claim, we all know that economics is at least as much art as science.  If economics was really a science, economists would have answers.  They don’t.  What they do have are theories – lots of theories.

When a radiologist looks at an x-ray, most of the calls are pretty clear-cut:  “Yep, that’s a broken arm.”  When the cable guy comes to your house because you haven’t been able to connect to the web, it’s there on your monitor, clear as day:  “Hey, your internet is down.”

Not exactly rocket science.

But economists just have their theories.

How do you fix the slumping economy?  “More federal spending.”  “Less federal spending.”  “Cut taxes.”  “More free trade.”  “Stronger measures to protect jobs from going overseas.”  “Do nothing and leave it to the market.”


Economists are like Republicans and Democrats, or Catholics and Jews, or those who love Paul and those who prefer John:  their theories have their basis in some school of thought that is, in turn, based on a lot more theories.  There are Keynesians and supply-siders, proponents of the Chicago school and the Austrian school, laissez-faire economists and monetarists, and many others.  Everything they do, everything they think, every breath they take, every move they make, every idea they half-bake, is based on their school of thought.

And none of them actually know anything.  Oh, sure, they know lots of stuff, but none of it really has much value – kind of like a high school science teacher who manages to win $150,000 on Jeopardy.  They just have theories.  A few facts, little real objective knowledge or measures, just subjectivity – art, not science.

If there’s anything more frustrating than the utter uselessness of economists trying either to explain or improve our lot it’s the degree to which they seem divorced from reality.  Many of them work in academia, which no doubt facilitates their isolation from the real world and encourages them to put forth more theories that have little or no value.

In theory, this very isolation could be beneficial.  After all, it should leave them less susceptible to those who would like to influence or even manipulate their research and findings:  politicians, corporate types, ideologues, partisan think-tanks, public opinion, and the like.  On the other hand, it can leave them divorced from reality in a way that calls to mind the movie Back to School in which Rodney Dangerfield plays a successful businessman who enrolls in college to be closer to his son.  Dangerfield, in all his obnoxious glory, sets straight their professor – played brilliantly by Paxton Whitehead, who’s always fun – who presents an academic, textbook case study of what’s involved in launching a business.  Dangerfield disrupts the class by explaining how things work in the real world – how they work in ways that bear no resemblance whatsoever to what the professor is telling his students.

This kind of disengagement from the real world can greatly facilitate economists’ predisposition to stupidity.

Consider, for example, the area of health care.

To most of us, finding better ways to treat illness and manage care is a good thing.  Outside of the drug companies, which fervently want all of us to live long lives punctuated with frequent, chronic, and occasionally serious illnesses, you won’t find much of a constituency for more disease.  In general, we like the idea of living longer and being healthier for more of that long life.  It seems pretty obvious, and intuitive.

But not to economists.  Economists don’t necessarily agree that finding better ways of treating disease is a good thing.  To an economist, introducing a significant improvement in health care upsets what they have come to view as a natural balance.  Cures, to their way of thinking, are a bad thing because cures prevent deaths, which economists count on to slow the growth of health care spending.

To an economist, turning a fatal illness into a chronic but survivable and manageable condition is a bad thing because it requires long-term consumption of health care services at great cost.  Economists want people who contract AIDS to die quickly, not to benefit from expensive drugs that can prolong their lives five or ten or twenty years or more.  They want cancers to be fatal, not to respond to treatments that enable people to live with them for untold years.  They want babies born prematurely to die shortly after they are delivered, not to spend months in a neonatal intensive care unit carefully being nursed to life.  Society is not better off for such advancements, in their eyes; we are the poorer for it.

The convoluted thinking of economists takes other forms, too.  Consider the economist, also a self-proclaimed “foodie,” who offered “Six Rules for Dining Out” in the May 2012 edition of The Atlantic.

Among his tips:

In the fanciest restaurants, order what sounds least appetizing.

Doesn’t everyone?  Don’t we all study a restaurant’s menu with care and then choose the least appetizing entrée we find?

The Curmudgeon would explain the author’s rationale but that rationale is irrationale, so he’ll spare you the silliness.  You can read it, in all its warped logic, here.

But the economist isn’t done.

I also start to worry if many women in a restaurant are beautiful in a trendy or stylish way.  The point is not that beautiful women have bad taste in food.  Instead, the problem is that they attract a lot of men to the restaurant, whether or not the place serves excellent food.  And that allows the restaurant to cut back on the quality of the food.

Right:  because pretty women don’t have bad taste in food but men apparently do.

He also urges us to “prefer Vietnamese to Thai,” even though that would seem to be a matter of taste, but then offers an exception:  “Eat at Thai restaurants attached to motels.”  Read his warped reasoning yourself.  It’s hard to make The Curmudgeon lose his appetite – he’s an eater, though not a foodie – but this guy may have done exactly that.

And these two examples, friends, illustrate why economists can be pretty stupid.

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