AXEC: New Foundations of Economics

November 2, 2026

Occasional X: Clueless economists / Science (CCCXCII)

“Economists will look you dead in the face and call this science.” (Jack Meyer) Yes, this is the sorry state of economics. It's scientifically worthless — only good for inconclusive political blather. But they award themselves the EconNobel for 'economic sciences' (AXEC136j ⇓). Science is binary true/false and NOTHING in between. Non-science is the swamp between true and false where ‘nothing is clear and everything is possible’ (Keynes). The distinction between science and non-science corresponds to the ancient Greeks’ distinction between episteme (= knowledge) and doxa (= opinion). Methodologically, economists are 2400 years behind the curve. The fact is that about ninety-nine per cent of people are satisfied with opinion, and only one per cent is devoted to episteme. Economists do NOT belong to the latter group. Economics is a cargo cult science, and economists are fake scientists, and the EconNobel is a fraud. When they've used all their arguments, the scientifically clueless hit the social media emergency brake and retreat to an etiquette class: “Personal insults are best left in the schoolyard. Nor do they contribute to the persuasiveness of your derivative arguments. You are Blocked.” (Roger Farmer, #EconBlocker) The state of economics is this: there is political economics and theoretical economics. The founding fathers called themselves political economists; that is, they left no doubt that their main business was agenda pushing. Economists never got out of political economics. In other words, theoretical economics (= science) ultimately could not emancipate itself from political economics (= agenda-pushing). This is why economics never rose above the level of a proto- or cargo cult science. There are the hard rocks of true or false and the swamp between them. The swamp is the natural habitat of morons, agenda pushers, confused confusers, incompetent scientists, political economists, status-quo inertionalists, commonsensers, and anti-scientists. Political economists are natural-born swampies. In marked contrast to scientists who drive the question under discussion to the point of a clear-cut decision between true or false, neither the orthodox nor the heterodox swampy has a genuine interest in a definite outcome but seeks to keep matters in the swamp of inconclusiveness. Swampiness is what Popper called an immunizing stratagem because: “Another thing I must point out is that you cannot prove a vague theory wrong.” (Feynman) Therefore, the cargo cult scientist is mainly occupied with producing a methodological smoke screen that consists of vague concepts, anything-goes, pluralism of false theories, alleged complexity, ontological uncertainty, unreliable data, faux humility, the post-modern replacement of true theory by political narrative, and a veritable artillery barrage of silly excuses. The beauty of the swamp is that logical and empirical failure is inconsequential.” (AXEC) For more details, see What is so great about cargo cult science? or, How economists learned to stop worrying about failure https://t.co/VoQJMa4CUZ From the beginning, economics has not been a science but silly political agenda pushing. There has not been genuine scientific progress since the Enlightenment, only changes in propaganda. Watch the sorry contemporary academic discussion. They're just turning over the scientific dung heap without ever arriving at a result that satisfies the most elementary scientific principle: “In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.” (Morgenstern, 1941) Economics has defined itself as a social science and accordingly has been based on subjective/behavioral assumptions/axioms. This is the methodological ur-mistake. The major approaches (Walrasianism, Keynesianism, Marxianism, Austrianism, and their derivatives) are mutually contradictory, axiomatically false, and materially/formally inconsistent. They all got profit wrong. When the subject's foundational concepts are inconsistent, the entire analytical superstructure is scientifically worthless. The minimum requirement in science is logical consistency. Economists never rose above confused blather. As far as an approach is formalized, economists apply the wrong math. However: “The problem is not just to say that something might be wrong, but to replace it by something ― and that is not so easy.” (Feynman) To finally become a science, economics needs a Paradigm Shift. The current group of academic non-scientists will not survive this.
— AXEC (@EgmontHandtke) November 2, 2026

November 1, 2026

Occasional X: Paradigm Shift (CXXIX)

“Yes. General Equilibrium Theory is a language that enforces internal consistency. Like individual rationality: GE alone is irrefutable. That does not mean it is worthless: Far from it.” (Roger Farmer) Yes, consistency is important: “Research is, in fact, a continuous discussion of the consistency of theories: formal consistency insofar as the discussion relates to the logical cohesion of what is asserted in joint theories; material consistency insofar as the agreement of observations with theories is concerned.” (Klant) However, each Paradigm stands or falls with its premises: “When the premises are certain, true, and primary, and the conclusion formally follows from them, this is demonstration, and produces scientific knowledge of a thing.” (Aristotle, Analytica) J. S. Mill was perfectly clear about the starting problem: “What are the propositions which may reasonably be received without proof? That there must be some such propositions all are agreed, since there cannot be an infinite series of proof, a chain suspended from nothing. But to determine what these propositions are, is the opus magnum of the more recondite mental philosophy.” The problem with modern macroeconomics is that it is axiomatically false. Economics is failed/fake science. The microfoundations approach was doomed from the outset. The Founding Fathers defined economics as a social science, and accordingly, it has been based on subjective/behavioral assumptions/axioms. This has been the methodological ur-mistake. For example, here are the Walrasian axioms: “HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.” (Weintraub) The methodological mistake is that economists put the behavioral assumption of constrained optimization and equilibrium into the premises. This is a petitio principii, but economists do not know what this means. Stupidity makes faithful worshipers: “And so — faithful to the theory's conceptual cornerstones and hoping against all hope that the unthinkable may still be achieved (i.e., a satisfactory theory of the price mechanism) — the tormented upholders of the validity of the paradigmatic core of economic equilibrium theory appear singularly reluctant to face the problem of comparing expectations and results and assessing the consistency of the theory.” (Ingrao et al., 1990, p. 346) Although microfoundations is methodologically a false concept, economists repeat it nonetheless: “In economics we should strive to proceed, wherever we can, exactly according to the standards of the other, more advanced, sciences, where it is not possible, once an issue has been decided, to continue to write about it as if nothing had happened.” (Morgenstern, 1941, pp. 369-370) The way forward is to reconstruct economics entirely without the concepts of constrained optimization, rational expectations, equilibrium, and other NONENTITIES. In methodology, this is called a Paradigm Shift: “There is another alternative: to formulate a completely new research program and conceptual approach. As we have seen, this is often spoken of, but there is still no indication of what it might mean.” (Ingrao et al., 1990, p. 362) It means, first, that legacy economics goes down the scientific drain for good. It means, second, to go forward and perform the Paradigm Shift (⇓ AXEC113i). It means, finally, to bury microeconomists in the darkest corner of the Flat-Earth cemetery. Economics is a genuine system science, not a social science. Economists have gotten it wrong since the Founding Fathers. The EconNobel for 'economic sciences' is a scientific fraud. Roger Farmer is a retarded blatherer.
— AXEC (@EgmontHandtke) November 1, 2026

Occasional X: How it works (DXXXII)

Why the Worst Get on Top is the title of Ch. 10 in Friedrich Hayek's book The Road to Serfdom. In the free-market economy, profit may provide a strong incentive to corruption/organized crime. According to quasi-Darwinian logic, the most corrupt survives. The proof is given in table AXEC221b ⇓. Microfoundations are methodologically false; therefore, the elementary production-consumption economy is given with three macroeconomic axioms in lines 1, 4, 7. The business sector is split into two identical firms in lines 1-2, 4-5, 7-8. Under the initial analytical conditions of market-clearing and budget-balancing, this yields the price P in line 16. For a start, the price is the dependent variable here. In the initial state, the price is equal to unit wage costs W/R, and equal for both firms. The workers get the whole product O. The profit Qm for both firms and the business sector as a whole is zero. Now, the wage rate W in firm 1 is lowered arbitrarily; otherwise, both firms are identical in every respect. As a result, the market price P decreases in line 12. The profit of firm 1 increases in line 19; firm 2 makes a loss in line 20. Total profit remains zero. The household sector as a whole still gets the whole product O, but the workers of firm 1 can buy less with their lower wage income; the workers of firm 2 can buy more with their unchanged wage rate W and a lower price P. The firm that somehow manages to pay less for the same labor input increases profit Qm. Firm 2 makes a loss and will go bankrupt if it does not also make a wage cut. As a result, firm 1 wins the race to the bottom. The workers of firm 1 cannot move to firm 2 because it no longer hires or doesn't exist any longer. This process of cross-over exploitation is inherent to capitalism and inevitably leads to higher concentration. If a firm can undercut minimum wage regulations, it can be said that the criminal firm wins and the honest firm loses. What remains in the long run is a degenerated/ corrupted free-market economy. On closer inspection, economics is revealed as the story of intra-sectoral cross-over exploitation among the firms of the business sector and among the households of the household sector. Sociologically, this means there are no classes with a common interest. Ultimately, the market is not primarily an allocation mechanism but a quasi-Darwinian selection mechanism that increases the survival chances of the corrupt and decreases them for the honest. This is why guilds have emerged historically. Basically, they are self-organized associations of the honest against the corrupt, with honor as the guiding behavioral principle. Honor was replaced with the freedom of licit/illicit profit maximisation, which favors the corrupt.
— AXEC (@EgmontHandtke) November 1, 2026

Occasional X: How it works (DXXXI)

“If only 4% of gains went to innovators and we got so much innovation, what if property rights were tightened? What if they could appropriate 5% instead? How much more innovation would we get?” (Vincent Geloso) Innovators and creative geniuses are the most exploited group in the free-market system. Business has captured the real wealth creators. As a rule of thumb, not those who create and ultimately enhance the productivity of the economic system get wealthy, but those who employ or sponsor them — or simply steal their ideas. Of course, the group/generations of innovators and creative geniuses deserve 100 percent of the gains. How could they appropriate it? For details, see How it works (DXXX) https://t.co/ibUuwn8flm
— AXEC (@EgmontHandtke) November 1, 2026

Occasional X: How it works (DXXX)

“Generations of students learned economics through the Samuelson and Nordhaus textbook. But my favorite article of his is another one: 'Schumpeterian Profits in the American Economy: Theory and Measurement,' from 2004. For every 100 euros of value that an innovator creates, they keep just a little over 2. We get the other 98. … It's worth remembering this whenever someone proposes heavily taxing the fortunes of entrepreneurs, as if they were a burden on society. The innovator already keeps a minimal slice of the value they create. Taxing that slice yields little and puts everything else at risk.” (Pedro Santa Clara) The obvious swindle is to verbally equate innovators and entrepreneurs. They are as different as can be. Innovators and creative geniuses are the most exploited group in the free-market system. Business has captured the real wealth creators. As a rule of thumb, not those who create and ultimately enhance the productivity of the economic system get eventually wealthy, but those who employ or sponsor them — or simply steal their ideas. The real creative genius Tesla died poor, with a charity from the firm he helped to create and prosper.‡ In the end, the royalties go elsewhere. “Nordhaus wanted to know how much of the value created by innovation stays with the innovator. … The answer: about 2.2%. The rest went to society, especially to consumers, in the form of lower prices and better products.” (Pedro Santa Clara) Innovators and creative geniuses cannot be presented as the heroes of the free-market system. They enhance the productivity of a firm, but the enhanced profits are taken by the firm's owners. That scientists/inventors work for firms is a historical accident and in NO way intrinsic to science. To the contrary. Genuine scientists, for example, are fed up with working under the direction of a management with entirely different incentives or constantly begging for funding from the oligarchy. Seen from the perspectives of merit and the freedom of science, this is as perverse as it gets — in any case for basic research. Time for a new business model ⇒ A rough business plan for science https://t.co/fvOOBCrRgV Toward the New Academy https://t.co/4lOOZdZkox ‡ Sources “In early 1891, George Westinghouse explained his financial difficulties to Tesla in stark terms, saying that, if he did not meet the demands of his lenders, he would no longer be in control of Westinghouse Electric and Tesla would have to 'deal with the bankers' to try to collect future royalties. The advantages of having Westinghouse continue to champion the motor probably seemed obvious to Tesla and he agreed to release the company from the royalty payment clause in the contract. Six years later Westinghouse purchased Tesla's patent for a lump sum payment of $216,000 as part of a patent-sharing agreement signed with General Electric ….” (Wikipedia) “At this time, Westinghouse Electric & Manufacturing Company began paying him $125 (equivalent to $3,010 in 2025) per month in addition to paying his rent. Accounts of how this came about vary. Several sources claim that Westinghouse was concerned, or possibly warned, about potential bad publicity arising from the impoverished conditions in which their former star inventor was living. The payment has been described as being couched as a 'consulting fee' to get around Tesla's aversion to accepting charity.” (Wikipedia) “J.P. Morgan stopped funding Nikola Tesla … around 1903–1904 because Tesla's project lacked a viable business model for making money.” (Google AI)
— AXEC (@EgmontHandtke) November 1, 2026

Occasional X: Clueless economists / Money (CXLXVIII)

“Why do we use money? This should be the fundamental question of a monetary economics course. Although it seems like a somewhat obvious question, the use of money is anything but trivial when we look at it analytically through the prism of economic theory; particularly the ideal models described by Walrasian general equilibrium.” (Königs) Walrasian general equilibrium is known to be proto-scientific garbage. It's the worst possible starting point for Monetary Theory. The axiomatically correct macroeconomic approach is summarized in the table below AXEC237c ⇓ . Microfoundations are methodologically false; the economic system is based on three macroeconomic axioms (lines 1-3). As a result, the market-clearing price P is analytically determined by the relationship between the quantity produced/supplied/bought O=X and the nominal demand Ec. Budget-balancing means that nominal demand is equal to income, here Ec=Yw. The labor time L washes out and plays no role in the price determination. In the monetary economy, the resulting market-clearing and budget-balancing price for a one-good economy is P=:W/R, i.e., the price is equal to unit labor costs (line 5). Profit is zero (line 11). The workers get the entire product O. In the general case of non-budget-balancing, the market-clearing price is shown in line 9. In general, nominal demand depends on income and the expenditure ratio. The expression ρE*Yw implies an income-dependent demand curve. The household sector provides the labor input L and gets the wage income Yw. There is no other income in the elementary case. At this logical point, money enters the picture in line 16. It is of no interest here how money evolved historically. Here, money is not needed for facilitating the exchange of goods, but for paying the wage bill. The households, in turn, spend their wage income on buying the consumption goods output O. Thus, money returns to the business sector. Transaction money is here provided (at zero cost, i.e., no fee, no interest) by the Central Bank in the form of fiat money. By sequencing the initially given period length of one year into months, the idealized transaction pattern is displayed in line 16 in the table below. It is assumed that the monthly income Y/12 is paid out at mid-month. In the first half of the month, the daily spending of Y/360 increases the current overdrafts of the households. At mid-month, the households change to the positive side and have current deposits of Y/24 at their disposal. This amount reduces continuously towards the end of the month. This pattern is exactly repeated over the rest of the year. So, transaction money comes from the Central Bank; it is zero at the beginning and at the end of a given period. The average quantity of transaction money depends on the transaction pattern κ, total employment L, and the wage rate W. Money is created out of nothing and returns to nothing. There is no such thing as a fixed quantity of money. Money is present and absent depending on the time frame of observation. So, the Central Bank creates the needed fiat money out of nothing according to the changing demands due to the transactions between the household and the business sector. Transaction money is determined endogenously — “that is, as a result of the interactions of other economic variables…” (Wikipedia). There is no such thing as a 'supply of money'. The wage rate W and employment L are determined in the interaction of the household and the business sector. The Central Bank simply provides the wage bill, whatever it is. The graphic reduces formally to the money axiom in line 16. In the symmetric case Ec=Yw, the average quantity of money depends on the transaction pattern κ, the wage rate W, and employment L. If employment increases, the average stock of transaction money increases. Because W and P are formally related in line 9, there also appears a statistical correlation between price and average stock of transaction money. Both depend on the expenditure ratio ρE (lines 9 and 18). The point to start with is that both the market-clearing price and the average quantity of money depend on the expenditure ratio. This indirect relationship makes it appear that there is a correlation between the quantity of money and price. However, there is no causality from M to P. Money becomes a store of value if the expenditure ratio is ρE>1. In the most elementary case, the household sector dissaves, i.e., Ec>Yw, and the business sector makes a profit Qm as shown in line 11. At the end of the period, the business sector has a stock of money at the Central Bank equal to profit Qm. And this is the point. The concept of macroeconomic profit does not appear in legacy economics. The representative economist obviously does not know that the creation of money is intimately connected with the creation of profit. In other words, they do not understand how the economic system works. For details about the axiomatically correct approach, see the working paper ⇒ The Dark-Matter Theory of Fiat Money https://t.co/0QSqFFrVUX
— AXEC (@EgmontHandtke) November 1, 2026

Occasional X: The foul spirit of political economics (CDXXII)

“RIP to an absolute lion of the field.” (Noah Kaufman) The usual abuse of obituaries for the glorification of scientifically incompetent political agenda pushers of economics as a failed/fake science. For details, see The foul spirit of political economics https://t.co/F4Vc3v2q9e
— AXEC (@EgmontHandtke) November 1, 2026

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Knowledge only — no opinion

Science does not explain everything, but non-science explains nothing.

Neither orthodox nor heterodox economics satisfies the scientific criteria of material and formal consistency.

Economists cannot explain how the economy works. The Profit Theory is false since Adam Smith. There is much opinion and little knowledge.

Opinion is the realm of political economics, knowledge is the realm of theoretical economics.

Political economics is scientifically worthless.

Theoretical economics is built upon clearly stated premises, i.e., upon a set of axioms.

Orthodoxy got the axiomatic foundations wrong and Heterodoxy has none at all.

Economics is a failed science. Economists are incompetent scientists.

Profit

Neither Classicals, nor Walrasians, nor Marshallians, nor Marxians, nor Keynesians, nor Institutionialists, nor Monetary Economists, nor MMTers, nor Austrians, nor Sraffaians, nor Evolutionists, nor Game theorists, nor EconoPhysicists, nor RBCers, nor New Keynesians, nor New Classicals ever came to grips with profit. Hence, they all fail to capture the essence of the market economy.

Because of this, economists have nothing to offer in the way of a scientifically founded economic policy guidance.

The hybrid science

As a first approximation, one can agree on the general characteristic that the economy is a complex system.

However, with the term system one usually associates a structure with components that are non-human. In order to stress the obvious fact that humans are an essential component of the economic system the market economy should be characterized more precisely as a complex hybrid human/system entity.

The scientific method is straightforwardly applicable to the sys-component but not to the hum-component. While it is clear that the economy always has to be treated as an indivisible whole, for good methodological reasons the analysis has to start with the objective system-component.

In gestalt-psychological terms the economic system is the foreground, individual behavior the background. Common sense wrongly insists that the hum-component must always be in the foreground. This fallacy compares to geo-centrism. The economic system has its own logic which is different from the behavioral logic of humans. The systemic logic is what Adam Smith called the Invisible Hand.

There are systemic laws but no behavioral laws. Systemic laws have the same methodological status as physical laws.

Neither Orthodoxy nor Heterodoxy can tell what the systemic laws of the actual monetary economy are.

Whether the outcome of the human/system-interaction is good or bad is a politcal question that lies outside of theoretical economics. Theoretical economics explains how the actual economy works - no less, no more.

Narrative vs.Theory

Psychological, sociological or behavioral assumptionism cannot yield anything other than a gossip model of the world. Second-guessing the agents is not economic analysis.

Science deals exclusively with propositions that can in principle be decided by objective means. The rest is opinion, faith, phantasy, motive speculation, allegation, hallucination, myth, paranoia, ink-blot association, psychology, philosophy, in one word: storytelling.

Storytelling is the original mode of communication in the social realm — except science.

Political economics is storytelling and, by default, the natural habitat of confused confusers. Walrasianism, Keynesianism, Marxianism, Austrianism are social narratives and not scientifically valid representations of reality.

"The truth is, most persons, not excepting professional economists, are satisfied with very hazy notions." (Fisher)

In marked contrast, theoretical economics lives up to the standards of material and formal consistency. A scientific theory is the best mental representation of reality that is humanly possible.

Theory starts with a set of objective and consistent axioms.

Paradigm Shift

"The problem is not just to say that something might be wrong, but to replace it by something — and that is not so easy." (Feynman)

"As will become evident, there is more agreement on the defects of orthodox theory than there is on what theory is to replace it: but all agreed that the point of the criticism is to clear the ground for construction." (Nell)

"The moral of the story is simply this: it takes a new theory, and not just the destructive exposure of assumptions or the collection of new facts, to beat an old theory." (Blaug)

"Is it not a fact, which stares at us from the histories of all sciences, that it is much more difficult for the human mind to forge the most elementary conceptual schemes than it is to elaborate the most complicated superstructure when those elements are well in hand?" (Schumpeter)

"The task of producing knowledge against the grain requires imagination." (Mirowski)

"A new idea is extremely difficult to think of. It takes a fantastic imagination." (Feynman)

"The scientific imagination dreams of explanations and laws." (Peirce)

"It is brilliance of imagination which makes the glory of science." (Evans)

"... we know little more now about ‘how the economy works,’ ... than we knew in 1790, after Adam Smith completed the last revision of The Wealth of Nations." (Clower)

Selftest and to watch for

You apply one of these items

• supply-demand-equilibrium,

• general equilibrium,

• marginal utility,

• well-behaved production functions,

• total income = value of output,

• total income = wages + profits,

• I=S,

• wage rate down - employment up,

• behavioral axioms?

Then you are out of science because of unnoticed material or formal inconsistency.

Every economist who uses the concept of equilibrium is scientifically incompetent because she/he failed to notice that equilibrium is an economic nonentity.

Practically this means: as soon as the word equilibrium appears in an economic text it can be thrown into the waste basket. The same holds for all other nonentities.

The vast majority of economists deals mainly with nonentities. This is why Walrasianism, Keynesianism, Marxianism, Austrianism is scientifically worthless.

Since Adam Smith, economic policy guidance has no sound scientific foundations.

To be replaced (1)

The core premises of Orthodoxy are uncertain and false and this fully explains the failure of the research program.

“As with any Lakatosian research program, the neo-Walrasian program is characterized by its hard core, heuristics, and protective belts. Without asserting that the following characterization is definitive, I have argued that the program is organized around the following propositions: HC1 economic agents have preferences over outcomes; HC2 agents individually optimize subject to constraints; HC3 agent choice is manifest in interrelated markets; HC4 agents have full relevant knowledge; HC5 observable outcomes are coordinated, and must be discussed with reference to equilibrium states.” (Weintraub)

The inescapable Paradigm Shift consists of the move from this obsolete hard core to the superior set of structural axioms.

To be replaced (2)

The fundamental equations of macroeconomics have been formulated by Keynes in two lines.

"Income = value of output = consumption + investment. Saving = income - consumption. Therefore saving = investment."

This elementary syllogism is demonstrably false. The demonstration consists in the proof that Keynes could not solve the Profit Puzzle. Neither did Post-Neo-New-Keynesians.

In the most general terms, the economics Paradigm Shift consists in switching from the behavior-centric bottom-up approach to the structure-centric top-down approach. This is comparable to the Copernican turn from geo-centrism to helio-centrism.

Consensus

Economics is a science without scientists. Because they are ignorant of the elementary difference between profit and income, the present generation of economists has not made and cannot make a significant contribution to the discussion about how the actual economy works.

Every orthodox or heterodox economist can convince himself/herself that their profit theory is defective.

Every non-economist can — by applying elementary logic — convince himself that conventional profit theories are false. See 'How the intelligent non-economist can refute every economist hands down'.

Because the profit theory is false the whole of conventional economic theory has to be rejected.

"What is now taught as standard economic theory will eventually disappear, no trace of it will remain in the universities or boardrooms because it simply doesn’t work: were it engineering, the bridge would collapse." (McCauley)

No scientist will ever accept Walrasianism, Keynesianism, Marxianism, or Austrianism. These approaches are logically and/or empirically refuted. This is the actual methodological state-of-art. Walrasians, Keynesians, Marxians, or Austrians are still at the proto-scientific stage. These approaches cannot be improved, only abandoned.

Economists are a public nuisance because they have an opinion on everything but knowledge of nothing.

About me

“Bottom line is that your profit law is just a definition you made up nobody else agrees with, nobody. You are all alone with your precious tautology.” Barkley Rosser

“In any event, your entire theory is based on you doing macro accounting in wacky fashion that nobody agrees with.” Brian Romanchuk

"Your stuff is at least original: it's quite cool after a couple of decades at this to see a fresh Economics. But real promises are not advanced: they were around for millennia until the Greeks obscured them with Metaphysics." Chris Cook

"No mate, they're you-blockers. You have all the personality traits of a crank, and the rest of them have tired of you. You could be 100% right, and you'd still die as your only follower." Steve Keen

"What you are doing fills is all with joy, your constructive critique is most welcome!"

Achim Truger,

German Council of Economic Experts,

in a failed attempt to be ironic

"200+ years of thought and yet you are the only one who gets it—or even understands your argument. Thank god we have you, pseudonymous Twitter user. Otherwise no one would know."

William Luther

Assistant Professor of Economics

in a failed attempt to be funny

"Egmonts profit law is the perfect equation that demonstrates this in action. Put the equation into a spreadsheet and then add government spending and watch how it flows into profits. Enter in some debt (-Sm) and watch too how that flows into profits. It can't go anywhere else."

Dean

About the rest of economics

Walrasianism, Keynesianism, Marxianism, Austrianism, MMT, Pluralism are mutually contradictory, axiomatically false, materially/ formally inconsistent. Economics is a failed science.

“There are three classes of people: those who see. Those who see when they are shown. Those who do not see.” Leonardo da Vinci

In economics, the overwhelming majority belongs to Class III. This explains why economics is after 200+ years still at the proto-scientific level.

The obvious task for every economist is to advance from cargo cult science and political agenda-pushing to science. This is absolutely beyond the means of Class III people.

For 200+ years now, economists are not scientists but agenda pushers, useful idiots, clowns in the political Circus Maximus.

Nopopop

This blog does not add to any popular/un- popular opinion.

This blog does not hand out advice about how to avoid taxes, to get rich on the stock market, to be successful in business, to increase the wealth of nations, to run an economy, to maximize welfare, to prevent national/global bankruptcy, to improve the institutional setup of society, to get out of national/global depression, nor about how to save humankind or any subgroup thereof.

This blog is about the true theory of the actual monetary economy.

"In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion." (Stigum)

Focus

Science is of primary interest and importance. Scientists are of secondary interest.

With regard to science, most people lose focus easily because of a natural preference for anecdotes and gossip over facts or subjectivity over objectivity.

Hence, Schumpeter once considered it necessary to remind his habitually disoriented fellow economists: “Remember: occasionally, it may be an interesting question to ask why a man says what he says; but whatever the answer, it does not tell us anything about whether what he says is true or false.”

Science is about true/false and nothing else.

Disclaimer

Missing Blog-Reference links: AXEC does not guarantee that their comments can at any time be recovered from where they have been posted intitially because the availability depends on the publication policy of the blog owner which is implicitly accepted on entering a debate. See also: 'Economists: Incompetent? Stupid? Corrupt?'

Texts: Parts of arbitrary length of any of the author's texts is and will be used again by the author in papers, books, websites, blogs, and other media without explicit reference. The right to make corrections or minor textual improvements on reutilization is reserved. Therefore, it is always a good idea to double-check for the latest version.

Caution: Do not expect a corroboration of your political view. Neither a refutation. Political economics has been scientifically worthless since Adam Smith. Politics has to be separated from economics because it is categorically different from science. The best science can do and has always done is to prove beyond reasonable doubt that you have been objectively wrong or ignorant until now. Science goes beyond the naive common sense of today and becomes the sophisticated common sense of tomorrow.

See also Terms of Use and Legal at www.AXEC.org

Outlook

To recall, while political economics is storytelling, theoretical economics adheres to scientific standards.

The first task of theoretical economics is to get the axiomatic foundations right. This is what J. S. Mill called the opus magnum. Neither Orthodoxy nor Heterodoxy came up with a reasonable solution to this day. This explains the secular stagnation of economics.

There is no serious alternative to structural axiomatic economics. This is not a matter of opinion but of proof. The sole criteria are material and formal consistency.

All of economics has to be reconstructed from the ground up.

Major economic policy implication

The price mechanism does not work as standard economics hypothesizes. The axiom-based Employment Law states that overall employment increases if the average wage rate increases relative to average price and productivity. This gives one the lever to improve the employment situation all over the world and to fend off deflation without rising debt and without artificial capacity growth. To increase the average price relative to the average wage rate and productivity increases unemployment.

Right policy depends on true theory.

“In order to tell the politicians and practitioners something about causes and best means, the economist needs the true theory or else he has not much more to offer than educated common sense or his personal opinion.” (Stigum)

Lacking the true theory, economists promote for more than 200 years opinion instead of knowledge.