by From Alanso Kihano (originally posted as a comment) What’s the use of economics? I think Alan Kirman’s post is completely off the target. Economics is used to achieve political aims. Politics it the first and major use of economics! The major purpose of economics today is to educate (or brainwash if you prefer) specialists, who can serve, and run the current socio-economic system without understanding it. Therefore, economics is obliged to create complex, but inadequate models. That suits perfectly the aim – the system could not be understood, and economics simulates sciences to gain credibility. Why that is necessary? To answer this question we need some retrospection. The contemporary mainstream economics is founded on the school of Adam Smith. Turn back to the political context of
Topics:
Editor considers the following as important: Uncategorized
This could be interesting, too:
Lars Pålsson Syll writes The non-existence of economic laws
John Quiggin writes The war to end war, still going on
Editor writes In search of radical alternatives
Stavros Mavroudeas writes «Οι καταστροφικές επιπτώσεις της ΕΕ στην Ελλάδα και τους εργαζόμενους» – Στ.Μαυρουδέας ΠΡΙΝ 20-21/4/2024
from Alanso Kihano (originally posted as a comment)
What’s the use of economics? I think Alan Kirman’s post is completely off the target. Economics is used to achieve political aims. Politics it the first and major use of economics! The major purpose of economics today is to educate (or brainwash if you prefer) specialists, who can serve, and run the current socio-economic system without understanding it. Therefore, economics is obliged to create complex, but inadequate models. That suits perfectly the aim – the system could not be understood, and economics simulates sciences to gain credibility.
Why that is necessary? To answer this question we need some retrospection. The contemporary mainstream economics is founded on the school of Adam Smith. Turn back to the political context of that time. Why Smith created his theory? The answer is given by Friedrich list in 1841 in his “National system …”. After summarising the principles of English colonial and trade practices on about 3 pages, he writes “In Adam Smith’s time, a new maxim was for the first time added to those which we have above stated, namely, to conceal the true policy of England under the cosmopolitical expressions and arguments which Adam Smith had discovered, in order to induce foreign nations not to imitate that policy.” The initial use of Adam Smit’s theory was the attempt to delude the other nations of how to reach economic development. Mainstream economics serves exactly the same aim today with exactly the same economic arguments for free trade. Mainstream economics is a nearly 300 years old lie. Yes, it has advanced, but mainly in the methods to conceal the truth by science-like models. The only change in political aspect is that at Smith’s time economics served both national and class interests – globalisation was entirely English. Today the capital is international and the national element is fiercely fought against. Economics is class ideology similar, but worse than the “scientific communism”.
I am a physicist with 20 years of scientific experience, and I do not see any reason for economics to be named science. Economics is wrong on its basic (actually non-existing) principles. There is major positive feedback in the capitalist economy – the profit. System with positive feedback can not be in equilibrium! It will oscillate, at best, or destroy itself at worst. Debt crises and inequality follow directly from this feedback.
I live already 30 years in capitalism, and I have never herd “there is no steel”, or “there is no aluminium”, or “there is no arable land”, or “there is no oil or gas”, but I hear everyday “there is no money”. Why? Why the scarcity of resources is a topic in the economics, but scarcity of money is not? Where is the reality there? Economics deals with complex mathematical models, but fails at the basic algebra! Why?
The answer is quite simple – there is no POLITICAL will for change!
I understand that the economists will strongly disagree and may even be offended by my opinion, but that is not my goal. I understand them, economics serves very well its aim – it made them see the trees, but not the forest. Once you are in, the way out is quite difficult. My goal is to seed doubt and provoke thinking outside the cage.