March 19, 2017

Endtime for soapbox economists

Comment on Simon Wren-Lewis on ‘Labour MPs are keeping Corbyn in power’


Most people have no proper understanding of what economics is all about. Therefore, it is of the utmost importance to distinguish between political and theoretical economics. The main differences are: (i) The goal of political economics is to successfully push an agenda, the goal of theoretical economics is to successfully explain how the actual economy works. (ii) In political economics anything goes; in theoretical economics, the scientific standards of material and formal consistency are observed.

Theoretical economics has to be judged according to the criteria true/false and NOTHING else. A closer look at the history of economic thought shows that theoretical economics had been hijacked from the very beginning by the agenda pushers of political economics. Smith, Ricardo, Malthus, Marx, Keynes, Hayek, Friedman, Krugman, Lucas, Wren-Lewis and almost everybody in-between falls into the category of political economist or fake scientist.

Political economics has produced NOTHING of scientific value in the last 200+ years. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got the pivotal concept of the subject matter, i.e. profit, wrong. Economics is a failed science.

Economists cannot be taken seriously with regard to their own subject matter, much less so with regard to politics. From economists knowledge about how the market system works is expected and NOT a journalistic opinion piece about Trump or Corbyn or May or the internal problems of the Labour Party or the GOP or whatever the current political issue may be.

It is NOT decisive what the political agenda is, ALL of political economics is what Feynman called cargo cult science or what we call today fake science. In order that economics to finally become a science, soapbox economists have to be thrown out.

Egmont Kakarot-Handtke

Related 'The economist as stand-up comedian' and 'Krugman and the scientific implosion of economics' and cross-references Political economics