Rants and Raves


Friday, June 12, 2009

Economics: a short guide to the dismal science


I suppose everybody agrees we're in an economic crisis now. Unfortunately that's about all everybody agrees on.





The basic principles of economics are simple, quite easy to understand, and don't even involve math. When you get to the application, the details of production and consumption and measurement thereof, is where the math and razzle-dazzle comes in.

The 19th century historian Thomas Carlyle called economics “the dismal science.” Most people think it's because economics is complicated and boring. I suspect it's because economics tells you what you can't have.

The first principle of economics is: there's not enough of what we want for everybody. (The first principle of politics is to assure the electorate you can fix this.)


That's what's dismal about it, you can't have something for nothing. Unfortunately, the desire for something for nothing is part of human nature.

I once had an argument with an Englishwoman about the superiority of the British National Health Service. I pointed out the service is lousy by American standards. She countered that it's free, unlike our inhumane American system.

I said, “No it's not.”


“I understand that,” I replied, “but it's still not free. Because nothing is. If you didn't pay for it, it means somebody else did – and not by choice.”


But whether General Motors stays in business concerns me very little, as long as I can still buy a Ford or a Toyota. I feel for the Detroit autoworkers, honestly I do. But that money the government is giving them to make cars I don't want to buy is money I don't have to pay for my retirement, my kids education, or a car I'd rather buy.




* Libertarian purists and anarchists sail under the slogan "taxation is theft" and say all taxation is coercive and thus immoral.


On the other hand, nobody has satisfactorily explained how taking money by threat of force is different from theft either. Once you admit the right of taxation, how do you justify saying what amount is "too much"? How is 10% just and 50% unjust?



  • At 8:55 AM, Blogger Galt-in-Da-Box said…

    In 1776, we called such people "tyrants".


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