August 14, 2016

Economics: Science or cheap talk?

Comment on Barkley Rosser on ‘The Man Who Saved The World From Nuclear Holocaust During The Cold War’


In his follow-up post, Barkley Rosser says: “Staying within the game theory framework that Schelling operated within, the problem we face now is ‘cheap talk.’ This term entered formal game theory discussions in a paper in 1982 ...”#1

Cheap talk is the core problem of economics since Adam Smith: “But he had no such ambitions; in fact he disliked whatever went beyond plain common sense. He never moved above the heads of even the dullest readers. He led them on gently, encouraging them by trivialities and homely observations, making them feel comfortable all along.” (Schumpeter, 1994, p. 185)

This is how economics became the honeypot for morons, populists, incompetent scientists, useful idiots, and political agenda pushers.

With respect to scientific content, not much has changed from the founding fathers to Samuelson. His textbook has ― with a probability close to 1 ― the lowermost scientific content of all textbooks ever written. It is as inconsistent as you can get. Worse, Samuelson, like all his fellow economists, had no idea of what profit is. Every intelligent person can check this out by browsing through the textbooks from Samuelson to Mankiw (2015). The core problem of economics is that there is no such thing as an intelligent economist. No intelligent person has ever accepted nor will ever accept Samuelson’s pure unadulterated cheap talk as science. It is just the other way round: the acceptance of this garbage is apodictic PROOF of scientific incompetence.#2

Not scientific quality, but something else had changed since the founding fathers and this was the introduction of the economics Nobel Prize. The fact that Samuelson’s proto-science stuff was officially declared as science is, if anything, a sure indicator of the abysmal incompetence of the Prize committee.

The introduction of an economics Nobel Prize sorta-kinda marked a watershed. Yet it is NOT that economics moved finally from cheap talk proto-science to science; instead, economics moved from cheap talk proto-science directly to sitcom entertainment. This means in concrete terms that economics became subject to The First Law of the Entertainment Industry which says: Turn every issue between birth and death (and if possible pre-birth and after-death) into a personality show.

The wording of Barkley Rosser’s gossip post provides a fine example: “... most intelligent person he ever met, ... generally viewed as by far the most respected living economist, ... coauthor of the most famous and influential paper, ... but Samuelson thought Schelling was ultimately smarter than either of them, ... after all, he got his Nobel in game theory, ... which was by all accounts on the bedside table of JFK, ... Schelling, a technical adviser on the 1964 film, ‘Dr. Strangelove’, ... [he] pushed tirelessly in numerous channels, most of them private but highly placed, ... ‘many [very well informed] people’ say he was more responsible than anybody else for why there was no nuclear war during the Cold War.” (See intro)

Science, to recall, is simply about true/false and NOTHING else. So, let us return from JFK’s bedside and the cheap talk of “very well informed people” back to reality. Barkley Rosser is an incompetent economist. Proof: he has not realized to this day that economics textbooks are manifest scientific garbage since Samuelson’s firstling of 1948.

What on earth drives Barkley Rosser to pester the EconoSpeak blog with his even more incompetent cheap talk about the Cold War? What we know for sure about this period is (i) that it has been a mixture of top-secret and heavy disinformation from start to finish, (ii) that historians have NO consensus to this day about what was real and what was a hoax, (iii) that physics has been hijacked by politics to a degree never seen in history before, (iv) that scientists failed to prevent or even supported the weaponization of science.

Barkley Rosser’s Cold War gossip confirms what we already know; science in general and physics and economics, in particular, have to get out of politics and distance themselves to the highest possible degree from political agenda pushers of all colors. Politics and science do not mix. More, their mixing is a sure recipe for scientific failure as everybody can see with the naked eye: political economics has not produced anything of scientific value in more than 200 years ― it has all been cheap talk.

Egmont Kakarot-Handtke

Kakarot-Handtke, E. (2015). How the Intelligent Non-Economist Can Refute Every Economist Hands Down. SSRN Working Paper Series, 2705395: 1–6. URL
Schumpeter, J. A. (1994). History of Economic Analysis. New York: Oxford University Press.

#1 See the post
#2 “It was lucky for me that one of my undergraduate texts referred to Paul Samuelson’s Foundations of Economic Analysis as ‘the most important book in economics since the war.”’ (Lucas)

Related 'Samuelson or Who is the smartest smartie?' and 'Economics and Project Augean Stable'