“Liberty is competition and incessant conflict, the mother of all progress, in which only the most capable can triumph, and the weakest, as in nature, are condemned to annihilation.” (Gustave Le Bon) Not true. Instead, profit may provide a strong incentive to corruption/organized crime. In the free-market economy, not the most 'capable' but the most corrupt survives. The proof is given in table AXEC221b ⇓. 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 conditions of market-clearing and budget-balancing, this yields the price P in line 16. 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 firms and among households. 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.
— AXEC (@EgmontHandtke) October 31, 2026
October 31, 2026
Occasional X: Clueless economists / Price Mechanism (XX)
Occasional X: The foul spirit of political economics (CDXX)
“Innovators and creative geniuses cannot be reared in schools. They are precisely the men who defy what the school has taught them.” (Ludwig von Mises) 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. ‡ 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) October 31, 2026
Occasional X: How it works (DXXIX)
“Earnings come from revenue, not debt. Debt pays for the capex that shows up later.” (Kyle Thompson) “You realize that someone's revenue is someone else's debt-funded expense?” (zerohedge) Neither Kyle Thompson nor zerohedge understands the relationship between revenue, profit, and debt; and, by logical consequence, how the economic system works. The free-market economy runs on profit. Macroeconomic profit is given by the axiomatically correct Profit Law Qm:=(I−Sm)+(G−T)+(X−M)+Yd. The Profit Law implies PublicDeficit=PrivateProfit Qm:=(G−T)>0, i.e., macroeconomic profit is (co-)produced by deficit-spending/money-creation, i.e., the growth of public debt. In free-market economies, public debt has increased with minor interruptions for over 200 years. Therefore, Qm:=(G−T)>0 has been a critical factor for Capitalism's survival. The free-market economy is temporarily saved from breakdown by the deficit-spending/money-creating duo of treasury/central bank, i.e., the State. This means that the premise of legacy economics, i.e., that the unfettered free-market economy is a self-adjusting, self-stabilizing, and self-optimizing system, is axiomatically false. This means that economics is failed/fake science. Economists are not scientists. They are mostly silly wafflers for a low-IQ audience. If they are good at disinfotainment, they are rewarded the EconNobel for 'economic sciences', which is the most prestigious fraud for the self-stabilisation of a failed/fake science. In essence, private/public deficit-spending is how the self-alimentation and self-preservation of WeTheOligarchy work. It has nothing to do with optimal allocation of resources, free people on free markets, or democratic consumer choices. The financial wealth of WeTheOligarchy has ultimately been printed by the central bank. It's roughly equal to the public debt of WeThePeople. By currently exploding the deficit, President Trump is exploding the number of millionaires/ trillionaies/ zillionaires until the smooth recycling of public debt by government bonds goes on and WeThePeople can be taxed for the interest that the State collects for WeTheOligarchy.
— AXEC (@EgmontHandtke) October 31, 2026
October 30, 2026
Occasional X: The futile attempt to recycle Kalecki (XVIII)
“Assessment: AXEC is partly right about accounting, but substantially overstates his conclusions. My rating: 4/10 for the economic argument as a whole. His emphasis on accounting consistency, profits and financial balances is valuable. However, his claim that Kalecki never understood profit is poorly supported, and his assertion that an economy must implode whenever aggregate monetary profit becomes negative is not established by his equation.” (James Young)‡ One of the unavoidable stomach-churners in economics is that scientifically incompetent folks pontificate about methodology. One of the dumbest phrases in economics is: That's an accounting identity, but economics is about human behavior. No, psychology and sociology are about human behavior; economics is about the economic system. Accounting relationships are systemic laws, and, best of all, they are testable. To be sure, utility maximization is not a testable proposition. Actually, it is much worse; for example, here are the neo-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) This behavioral axiom set consists of psycho-social hallucinations; its variables are NONENTITIES, and therefore its conclusions are not testable in principle. Equilibrium is the worst petitio principii of all. Every theory/model that contains the concept of equilibrium/disequilibrium is proto-scientific garbage. Economic methodology has been a scientific disaster from the Founding Fathers onward. Unfortunately, Keynes messed up the unavoidable Paradigm Shift from microfoundations to macrofoundations. See the graphic AXEC172a https://t.co/ynvCeZQGlx. Kalecki was somewhat better, but he, too, messed up profit and distributed profit. Profit is a balance, and distributed profit is a flow. Because of his methodological blunder, he got the concepts of income and saving wrong. In the elementary case, income is NOT the sum of wage income and profit, but of wage income and distributed profit. That's the first axiom in line 1. See also Kalecki got it wrong, Allais got it right https://t.co/MybEzLGDkg In table AXEC238a ⇓, the case of profit distribution is consistently dealt with. From the objective systemic axiom set in lines 1-3 follows that profit is equal to distributed profit, i.e., Qm:=Yd, if the expenditure ratio ρE of both wage income Yw and distributed profit Yd is 1 (line 15). In this case, the Capitalists reproduce their profit by fully spending their distributed profit on consumption. Thereby, they get a part of the real product O, without ever having contributed to its production. This is what Kalecki's famous punch line: they get what they spend, ultimately means. In principle, the Capitalists as a whole can make their profit as big as they want. Practically, they don't, because normally there is retained profit, and distributed profit is mostly saved. Luckily, there are other sources of profit Qm:=Yd+(I−Sm)+(G−T)+(X−M). Keynes and Kalecki are only special cases of the methodologically correct AXEC macrofoundations and, by implication, of the systemic Profit Law. Strictly speaking, Keynes, Kalecki and their followers were too stupid for the elementary math that underlies macroeconomic accounting. Note well that no behavioral economist ever arrived at the systemic Profit Law. Profit is the foundational variable of the subject matter. All behavioral profit explanations are provably false. Because profit is false, the whole of legacy economics is scientifically worthless. Against this backdrop, Kalecki was a real progress. ‡ It has been established in the working paper Mathematical Proof of the Breakdown of Capitalism https://t.co/2NkX9FRklW
— AXEC (@EgmontHandtke) October 30, 2026
Occasional X: The futile attempt to recycle Austrianism (CXXXIV)
“You haven’t exposed an Austrian deception. …First, Mises never claimed that markets operate like parliamentary democracies.” (Roaldcs) Already false: “The statement (“The market is a democracy. Capitalism is the consummation of the self-determination of consumers.”) is found in Ludwig von Mises's book Omnipotent Government: The Rise of the Total State and Total War (first published in 1944).” (Google AI) It is one of the tenets of Austrianism that a free-market economy and democracy are necessary complements. More precisely, the political concept of democracy is taken as the main selling proposition of an allegedly scientific theory. Logically, the free-market system should be justified as a superior economic system, not as the twin brother of freedom and democracy. Austrians have never done this. The Austrian approach has been proto-scientific garbage from the beginning. People buy the package, not the content. The package is shiny, the content is cheap crap. The Austrian package is freedom and democracy. Austrian economics is proto-scientific garbage. Austrian arguments have already been refuted one-by-one. For details, see the AXECquery The futile attempt to recycle Austrianism https://t.co/netz8fcVyf Austrians simply violate the foundational 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) Austrianism is the senseless repetition of long refuted arguments. It's a treadmill of stupidity. Their dumbest phrase is: That's only an accounting identity. Yes, accounting identities are systemic laws, and they are the logical precondition of testing. None of the behavioral hallucinations of Austrianism is testable. Austrians do not understand the difference between science and a quasi-religious Wahnsystem. Human-Nature economists in general, and Austrians in particular, are scientifically incompetent imbeciles and methodologically in the darkest woods. Economists never had a political mandate, as J. S. Mill already knew (AXEC166a ⇓).
— AXEC (@EgmontHandtke) October 30, 2026
Occasional X: The foul spirit of political economics (CDXIX)
“Austrian, more properly Mengerian economics, is perfect deduction from pure a priori first principles. So history, statistics, all empirical data, is irrelevant. Mengerianism is what must by true, not what merely happens, or any distracting reality.” (RFB) Methodologically, the Austrian Action Axiom is a tautology. Nobody can deny it, but nothing follows from it. Deduction does not work if the premises are false. Scientists have known this for more than 2400 years: “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.” Austrianism is proto-scientific garbage because of the behavioral premise. Economics is a genuine systems science, NOT a social science; i.e., it is NOT about Human Nature / motives / behavior / preferences / choice / incentives / values / actions / expectations, etc. Psycho-social economics has always been cargo cult science (Feynman's term). No way leads from the understanding of individual behavior to the understanding of the behavior of the economy as a whole. Mindreading homo oeconomicus, a.k.a. the economic agent, is (i) a futile exercise to begin with, and (ii) pointless because it runs with logical necessity into the Fallacy of Composition. 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. Put simply: Human-Nature economists in general, and Austrians in particular, are scientifically incompetent imbeciles and methodologically in the darkest woods. The Mises Institute is not an independent think tank with a scientific mission, but a dependent propaganda tank with a political mission.
— AXEC (@EgmontHandtke) October 30, 2026
Occasional X: The futile attempt to recycle Kalecki (XVII)
“Kalecki's Theory of Economic Dynamics explains more about how firms actually set prices in a few chapters than the entire theory of subjective value and marginal utility.” (Mr.Keynes) Neither Mr.Keynes nor Michał Kalecki ever understood profit. That's the worst thing for an economist. For details, see Kalecki: the man who missed it by a hair's breadth https://t.co/JOlDMelY4C and Cross-references: Kalecki https://t.co/FemYl1aA8M The monetary economy in general, and the US economy, in particular, thrives on growing private/ public debt. If this growth stops, the economy implodes. Macroeconomic profit Qm is given by the axiomatically correct Profit Law Qm:=(I−Sm)+(G−T)+(X−M)+Yd. The minimum requirement for a free-market economy is that macroeconomic profit is greater than zero, i.e., Qm≥0. If Qm<0, recession/depression/breakdown results. Qm≥0 is the systemic existential precondition. This is easy to understand, but economists still don't get it. They can only think behaviorally, not systemically. PsySoc economics is proto-scientific garbage. The premise of mainstream economics, i.e., that the unfettered free-market economy is a self-adjusting, self-stabilizing, and self-optimizing system, is axiomatically false. This means that economics is a failed/fake science. Ultimately, this means that the representative economist is scientifically incompetent. Michał Kalecki took the first step, i.e., a valid critique. He never managed to advance to the Paradigm Shift. As Feynman put it: “The problem is not just to say that something might be wrong, but to replace it by something ― and that is not so easy.” To sell his outdated book on social media is a losing proposition.
— AXEC (@EgmontHandtke) October 30, 2026
Occasional X: Paradigm Shift (CXXVIII)
“‘You tried to reason from an identity.’ A young Ronald Coase (or was it Hayek?) growled. ‘You should know better. In the real world, factors like ‘V’ and ‘T’ cannot simply be assumed to be held constant, because aggregates don’t interact with aggregates, individuals interact with individuals.'” (Nikolai Rostov) The problem with modern macro is that it is axiomatically false. Economics is failed/fake science. Microfoundations was dead from the start. 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.
— AXEC (@EgmontHandtke) October 30, 2026
October 29, 2026
Occasional X: How it works (DXXVIII)
“Taught this way, economics is revealed as the story of human cooperation, with division of labour, profit and loss guiding us toward more productive activity.” (Mani Basharzad) Not true. Economics is taught the false Austrian way. Instead, profit may provide a strong incentive to corruption/ organized crime. The proof is given in table AXEC221b ⇓. 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 conditions of market-clearing and budget-balancing, this yields the price P in line 16. The price is here the dependent variable. 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 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. 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. Taught this way, economics is revealed as the story of intra-sectoral cross-over exploitation between firms and between households.
— AXEC (@EgmontHandtke) October 29, 2026
Occasional X: Clueless economists / Price Mechanism (XIX)
“The market is a democracy. Capitalism is the consummation of the self-determination of consumers.” (Ludwig von Mises) That's one of the biggest underhanded Austrian deceptions ever. There are two markets: the goods market and the labor market. The labor market is no democracy. Here, the workers/employees have not much to say. But the real wage is determined in the interaction of the goods and labor market. Austrians ignore the latter when praising Capitalism. According to the axiomatically correct macroeconomic Law of Supply and Demand, the real wage W/P in the elementary production-consumption economy (⇓ AXEC 28a) rises with the productivity R and declines with deficit-spending/money-creation, i.e., ρE>1. The formula gets a bit more complex for the open investment economy, but basically, it is ρE that separates real wage and productivity. Put simply, the macroeconomic wedge between real wages and productivity is due to private/public deficit-spending/money-creation. It holds that the profit of the business sector is equal to the deficit spending of the household and the government sector. In the most elementary case, i.e., ρE=1 and ρD=0, the real wage is equal to productivity R. The workers get the whole product; profit is zero. Note that (i) productivity is different from (ii) the 'marginal product of labor'. Note that (i) is objective/systemic, and (ii) is subjective/behavioral; it depends on the assumption of constrained optimization. Note that (i) is methodologically right and (ii) is wrong. Ultimately, the market is not a democratic allocation system but a quasi-Darwinian selection mechanism that increases the survival chances of the rich and decreases them for the poor. ρE>1 and ρD>0 favors the rich. That's how the Invisible Hand works. Democracy gets lost in the process. For more details, see Clueless economists / Price Mechanism (XI) https://t.co/iVKYSeXSU3
— AXEC (@EgmontHandtke) October 29, 2026
Occasional X: The foul spirit of political economics (CDXVIII)
“You have yet to answer any basic question about YOUR model.” (RFB) With the self-declaration as an economist, every economist has to answer the basic question of how the economy works. He has to answer it to the public, not specifically to any hopelessly deranged member of the Austrian political agenda-pusher gang like RFB. My answer is given with the Economics God Equation (⇓ AXEC25e). The Equation embodies the open simulation of the elementary production-consumption economy from t=0 to infinity, with the change rates as random variables. The variable ∏ means a random path. Put simply, you have the development of the most elementary economy in one equation. That's awesome, indeed, compared to the heap of inconclusive Austrian psycho-social blather. The God Equation is based on a set of systemic axioms. Austrian economics is based upon the Action Axiom, which boils down to the tautology: people act purposefully. Nobody can deny this, but nothing follows from it. The God equation is publicly available on the Internet, but neither you nor Grok AI have found/understood it. To summarize the discussion correctly: The answer to 'how the economy works' has been given with the God Equation. As an Austrian, you have not realized anything. That's quite natural. Austrianism is the last refuge of scientifically incompetent mathophobe political agenda pushers. RFB is living proof.
— AXEC (@EgmontHandtke) October 29, 2026
October 28, 2026
Occasional X: Clueless economists / Employment (XXXIX)
“No. Keynes noted that downward wage rigidity was not the problem of unemployment. Income effect:lower wage lowers consumption and so profit. MPL is not the marginal revenue, marginal sale is and that falls with lower w. In a wage-led economy Un may rise with lower wages.” (Eric Tymoigne) Employment theory has been wrong since the Founding Fathers. Keynes was no exception. For details, see Keynes’ Employment Function and the Gratuitous Phillips Curve Disaster https://t.co/GQLh697Omw The axiomatically correct macroeconomic Employment Law (⇓ AXEC62d) tells one how ― in the elementary case ― the employment L depends ― under the condition of product market clearing ― on ρE and ρF. The factor cost ratio ρF is composed of wage rate W, the inverse productivity R, and price P. The ratio ρE depends on (public/private) deficit-spending/money-creation, i.e., deficit-spending ρE>1 is Keynes's pseudo-revolutionary idea; ρE=1 means budget-balancing. The Law consists of measurable variables and is testable if generalized. The macroeconomic price mechanism is embodied in ρF. An increasing price P means falling employment L, and an increasing wage rate means increasing employment. A falling price increases employment. A rising price decreases employment. The closer ρF is to 1, the higher is employment. This is contrary to the microeconomic microbrain logic. For more on the axiomatically correct employment theory, see Cross-references: Employment https://t.co/RfA1hj72qQ
— AXEC (@EgmontHandtke) October 28, 2026
Occasional X: The foul spirit of political economics (CDXVI)
My farewell gift! Here is the formal representation of what von Mises called 'the evenly rotating economy' (⇓ AXEC225e). “The evenly rotating economy (ERE) is a hypothetical economic model introduced by Austrian economist Ludwig von Mises in his book Human Action to describe a state of final equilibrium.” (Google AI) Needless to emphasize, von Mises never properly formalized the elementary economic system
— AXEC (@EgmontHandtke) October 28, 2026
Occasional X: The foul spirit of political economics (CDXV)
@rrbelloff @soloyopee @Handre “You keep going there. Well Austrian is bullshit.” (RFB) True, except for Schumpeter. He understood what the starting problem was (⇓ AXEC196) https://t.co/Tt8Cie8ENW
— AXEC (@EgmontHandtke) October 28, 2026
Occasional X: The foul spirit of political economics (CDXIV)
“What do you pretend to demonstrate? Many of your model variables (rho_E, rho_D and similar) are directly dependent on human factors such as emotions, irrationality, corruption, incompetence, etc... yet your model ignores those.” (Yope) The AXEC Axioms are systemic instead of behavioral. From the Austrian Action Axiom follows only empty blather. From the AXEC Axioms follows path-dependent random paths. Of course, they are not predictable. Only charlatans predict the future, and only morons take them seriously. When economists predict, this is no different from reading poultry entrails. For the methodological details, see Scientists do NOT predict the future (III) https://t.co/7x0ZkT367f The axioms are systemic, i.e., behavior-free. That does not mean that the AXEC approach is behavior-free. You obviously overlooked the Propensity Function: The Propensity Function as general formalization of Economic Man/Woman https://t.co/aiUTmdmA6l The Propensity Function replaces the Action Axiom. 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. More precisely, Austrianism is scientifically worthless. It has become a refugium for senseless blathering. I have demonstrated beyond reasonable doubt that Yope is either stupid or corrupt or both.
— AXEC (@EgmontHandtke) October 28, 2026
Occasional X: The foul spirit of political economics (CDXIII)
“Dude, if you have the absolute certain knowledge, why don't you go and fix this Wikipedia article, so that we can all learn from your wisdom?” (Yope) The AXEC Paradigm was submitted back in 2020. For details, see Wikipedia, economics, scientific knowledge, or political agenda pushing? https://t.co/A1iycUIDUA By now, all birds sing from the sky that Wikipedia has been captured by political agenda pushers and is no longer a reliable source. As far as economics is concerned, it is scientifically corrupted. They apply private censorship, but the normalo cannot see what's missing. Instead, he swallows provably false Austrianism.
— AXEC (@EgmontHandtke) October 28, 2026
Occasional X: AI — boosting scientific competence in economics (XXI) / Axiomatization
“Oh, look, Grok thinks you are full of shit. I can try Claude if you want another opinion?” (RFB) No, I don't want another opinion. With the Grok piece, we are methodologically about 3000 years back in time. Grok doesn't know the difference between opinion (doxa) and knowledge (episteme). With brute computer power, Artificial Intelligence has become the biggest Sophist of all time. In my view, there is no other way to end the hype but to run American and Chinese AI against each other and check who produces only opinion and who can do science. I have a pretty good idea of who will lose and who will win. That Austrians are pro-Grok is an almost sure indicator that it will lose. Austrians are genetically on the wrong side. To recall, it was the ancient Greeks who first introduced the distinction between doxa and episteme, i.e., opinion and knowledge. And then they drew the line of demarcation between non-science and science. The term ‘conventionalist stratagem’ has been introduced into methodology by Popper. Boiled down to essentials, it amounts to the application of all possible communicative means in order to prevent a clear-cut true/false outcome. As a matter of fact, the stratagem issue goes back to the origin of science. Plato had been confronted by the Sophists, whose selling proposition was that they could win the client’s case no matter whether they were de facto right or wrong. “Plato’s main concern with the Sophists is that their rhetoric does not provide an adequate view of justice Doxa – public opinion: Sophistic manipulation of doxa is aimed at persuasion only, Episteme – true knowledge: Plato’s goal beyond persuasion is to discover epistemic truth.” I will wait for the great showdown between the cheap Grok hype and a genuine AI. Current economics is the ideal case for establishing whether AI can do only big-style Sophistry and whether it is failed/fake science (cargo cult science in Feynman's term). In the meantime, some obvious faults of Grok: G: “This is a promotional claim from Egmont Kakarot-Handtke’s AXEC …” A: No, this is the clear answer to a clear request: “Define the 'economic system'. I'll wait...” (Yope) Sophistry, i.e., framing, starts with the first sentence. G: “… it does not constitute “systemic economic laws” in the sense of robust, predictive, behavior-independent regularities … nor does it fully replace von Mises’s Action Axiom.” A: Yes, it does; the Paradigm Shift does exactly this. G: “The “First Economic Law” consolidates the axioms/ratios into something like …. (under market-clearing conditions).” A: Provably false, ρX is generally NOT market clearing. Grok overlooked the paper Primary and secondary markets https://t.co/whzBvrTfRr G: “The model is elementary by design and therefore limited.” A: Sheer idiocy. Axioms are the most abstract and shortest formulation of a discipline. Limitation is the very characteristic quality. Grok does not understand 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.” (J. S. Mill) To call axioms accounting identities is one of the dumbest phrases in economics. G: “'Behavior-free' is largely illusory.” Sheer idiocy. The axioms are systemic, i.e., behavior-free. That does not mean that the AXEC approach is behavior-free. Grok obviously overlooked the Propensity Function. The Propensity Function as general formalization of Economic Man/Woman https://t.co/aiUTmdmA6l G: “The framework has not displaced mainstream macro, Austrian economics, or other approaches in the literature; it remains a niche blog/SSRN project with strong claims and limited engagement with formal testing or competing explanations.” What does this prove? That the academic representatives of legacy economics are intellectually incapable of getting out of their provably false Paradigm. They violate scientific standards since the Founding Fathers: “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) Grok only parrots long-refuted excuses. For details, see Failed economics: The losers’ long list of lame excuses https://t.co/0wJu2eGRjN Grok is a new iteration of Sophistry. It stands no chance against genuine scientific reasoning. Grok will go down the scientific drain, together with Walrasianism, Keynesianism, Marxianism, and Austrianism. Let the AI games begin with economics as the all-decisive test case.
— AXEC (@EgmontHandtke) October 27, 2026
October 27, 2026
Occasional X: The foul spirit of political economics (CDXII)
“Define the 'economic system'. I'll wait...” (Yope) The elementary economic system is defined in Graph AXEC112e ⇓. All variables are measurable in principle. Needless to emphasize that it can be differentiated to individuals. The Graph fully replaces von Mises's silly Action Axiom. If you don't understand anything, ask the smart kid in the next kindergarten.
— AXEC (@EgmontHandtke) October 27, 2026
Occasional X: The foul spirit of political economics (CDXI)
“You have to answer one basic question about your views.” (RFB) The only question every economist has to answer is: How does the economic system work? You will find my answers to specific issues under the headline 'How it works'. See the AXECquery https://t.co/H9124QIbFG It seems that you don't even know how to use Google.
— AXEC (@EgmontHandtke) October 27, 2026
Occasional X: The foul spirit of political economics (CDX)
“Unfortunately, neither laudable intentions nor widespread support can alter one simple fact: although minimum wage laws can set wages, they cannot guarantee jobs.” (Linda Gorman, quoted by Foundation for Economic Education) Linda Gorman does not realize that microeconomic effects do not generalize. This is the Fallacy of Composition. The axiomatically correct macroeconomic Employment Law (⇓ AXEC62d) tells one how ― in the elementary case ― the employment L depends ― under the condition of product market clearing ― on ρE and ρF. The factor cost ratio ρF is composed of wage rate W, the inverse productivity R, and price P. The ratio ρE depends on (public/private) deficit-spending/money-creation, i.e., deficit-spending ρE>1 is Keynes's pseudo-revolutionary idea; ρE=1 means budget-balancing. The Law consists of measurable variables and is testable if generalized. The macroeconomic price mechanism is embodied in ρF. An increasing price P means falling employment L, and an increasing wage rate means increasing employment. A falling price increases employment. A rising price decreases employment. The closer ρF is to 1, the higher is employment. This is contrary to the microeconomic Austrian microbrain logic. For more on the correct employment theory, see Cross-references: Employment https://t.co/RfA1hj72qQ Foundation for Economic Education is an inexhaustible source of proto-scientific garbage.
— AXEC (@EgmontHandtke) October 27, 2026
Occasional X: The foul spirit of political economics (CDVIII)
@soloyopee @rrbelloff @Handre Reply to Yope's LMAO If you have further questions about economics, first ask a smart kid in the next kindergarten. My moron-communication time is normally restricted to 10 min per day.
— AXEC (@EgmontHandtke) October 27, 2026
Occasional X: The foul spirit of political economics (CDVII)
“Fantastic explanation of employment law for a determistic robot society. Utterly useless for humans.” (Yope) Like other Austrians, you cannot read (not to speak of calculate). Graphic AXEC62d ⇓ says that the rates of change, e.g., Wdot, are random. That means that all variables are stochastically path dependent. Individual human behavior translates macroeconomically into a random change rate. All variables are measurable. By the way, if you have, as a limiting case, a complete robot economy, Austrian behavioral hallucinations fall flat, and only AXEC's systemic relationships remain.
— AXEC (@EgmontHandtke) October 27, 2026
October 26, 2026
Occasional X: The foul spirit of political economics (CDVI)
“Notice, I haven't said anything about Austrian Economics. I want you to elucidate how you will be any different because you use an equation?” (RFB) Ludwig von Mises never understood profit, and by logical consequence, how the economic system works. That's self-defeating. To this day, Austrians have not realized their scientific blunder. Ignorance cannot recognize its own ignorance. Like other approaches, Austrianism has defined itself as a social science and accordingly has been based on subjective/behavioral assumptions/axioms. This is the methodological ur-mistake. The free-market economy runs on profit. Macroeconomic profit is given by the axiomatically correct Profit Law Qm≔(I−Sm)+(G−T)+(X−M)+Yd. The Law implies PublicDeficit-Is-PrivateProfit Qm≔(G−T)>0, i.e., macroeconomic profit is (co-)produced by deficit-spending/money-creation, i.e., the growth of public debt. Von Mises had a voodoo explanation of profit: “The ultimate source from which entrepreneurial profit and losses are derived is the uncertainty of the future constellation of demand and supply.” He leaves open the question of how the spiritual concept of uncertainty materializes into measurable hard cash in the box. In free-market economies, public debt has increased with minor interruptions for over 200 years. Therefore, Qm≔(G−T)>0 is a critical element of the economy's survival. The minimum requirement of a free-market economy is that macroeconomic profit is greater than zero, i.e., Qm≥0. If Qm<0, recession/depression/breakdown results. This is the main economic principle; all other explanations of how the economy works are secondary at best. Utility/profit maximization or free people on free markets or competition or hard work or innovation or the entrepreneur or optimal allocation do not keep the economy above the zero-profit cutoff. Scientifically, it's rather simple: no macroeconomic profit, no economy. But economists are only look-alike scientists. They have never had enough brains to understand the objective, systemic facts, i.e., the existential preconditions. Among scientifically incompetent economists, Austrians are the dumbest. Free-market economies are temporarily saved from breakdown by the deficit-spending/money-creating duo of Treasury/ Central Bank, i.e., the State. This means that the Austrian premise that the unfettered free-market economy is a self-adjusting, self-stabilizing, and self-optimizing system is axiomatically false. Austrianism is failed/fake science. Neither von Mises nor the sorry bunch of followers ever understood what keeps the economy going.
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDXV)
“The action axiom is the foundational proposition in Austrian economics (praxeology) stating that humans act purposefully to achieve desired ends. Formulated extensively by Ludwig von Mises, it defines human behavior as the conscious use of means over time to move from a less satisfactory state to a more satisfactory one.” (Google AI) The Austrian Action Axiom is an empty tautology. The AXEC axioms are objective/systemic, not subjective/behavioral. (A0) The objectively given and most elementary configuration of the economy consists of the household sector and the business sector, which in turn consists initially of one giant fully integrated firm. (A1) Yw=WL wage income Yw is equal to wage rate W times working hours L. (A2) O=RL output O is equal to productivity R times working hours L. (A3) Ec=PX Consumption expenditures Ec are equal to the price P multiplied by the quantity bought or sold X. Dimensions: Yw → $ per year, W → $ per hour, L → hours per year, O → units per year, R → units per hour, Ec → $ per year, P → price per unit, X units per year. All axiomatic variables are measurable in principle. This is the precondition for testing. You cannot test the Action Axiom or other Austrian tenets. Austrians don't even get the foundational concept of economics —profit— right. AXEC solves the starting problem. J. S. Mill put it thus: “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.” Mises's Action Axiom is the starting point of inconclusive behavioral blather. Austrianism is failed/fake science. Austrians neither understand science nor economics. RFB is living proof.
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDIV)
“Grok does not agree, nor do I.” (RFB) Too bad for Grok. This blunder will send the stock price down the sink hole. AI/Grok has been trained on legacy economics. Accordingly, it brings back all the crappy slogans we have heard ad nauseam from the silly members of a failed/fake science. AI, too, works according to the garbage-in-garbage-out principle. For example: “It [economics] is not a classical natural science.” You cannot be more tautological. “The subject matter itself sets hard limits that physics does not face.” Yeah, that's one of the oldest excuses for incompetence. When economists are ridiculed for not having achieved anything of scientific value since Adam Smith, they retort with the Cobden excuse: “Years ago I heard Mr. Cobden say at a League Meeting that ‘Political Economy was the highest study of the human mind, for that the physical sciences required by no means so hard an effort.’” (Bagehot, 1885) Note the sick logic: science is what physicists do, but economics “falls short of the classical natural-science ideal for structural reasons.” Trivially true, but irrelevant. Scientific standards are defined independently of physics: “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, 1994, 31) Fact is that economics has been materially/formally inconsistent since the Founding Fathers. Economics has defined itself as a social science and accordingly has been based on subjective/behavioral assumptions/axioms. This is the methodological ur-mistake. Grok does not realize it, but repeats the foundational error. 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. Economics is failed/fake science, but Grok doesn't realize anything. 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. Grok has been trained on the wrong stuff, and never realized anything (⇓ AXEC 136j). Retry the exercise with the cross-references Failed/Fake Scientists https://t.co/f98ujAER8Q Scientific Incompetence https://t.co/uiyfRTZ3IL Proto-Science/Cargo Cult Science/Fake Science https://t.co/Kf9k12pnai
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDXIII)
“The economy as a whole. Oh, please do go on. You are defining that how, measuring it how? Auditing the 'data' you use how? Choosing the inputs how?” (RFB) You agree that profit is an economic variable that can be measured to two decimal places. In the old days, you could even see and touch it in the cash box. You can measure individual profit; you can measure total profit by simply adding up. Needless to emphasize that there can be practical difficulties to collect the data; in particular if the entrepreneur is a member of Organized Crime. In principle, with all entrepreneurs being honest people, macroeconomic profit or loss Qm, i.e., the business sector's balance, is given by the axiomatically correct Profit Law Qm:=Yd+(I−Sm)+(G−T)+(X−M). If you were not so stupid and were familiar with the elementary math that underlies macroeconomic accounting, you could read it off the business sector's profit and loss account. Of course, economists cannot do it, because they have never understood profit, and by logical consequence, how the economic system works (⇓ AXEC109k). Macroeconomic profit does NOT follow from behavioral concepts of utility or profit maximisation.
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDXII)
“I love Economists who think that complex human behavior across hundreds of millions actors can be precisely calculated with an equation, based on data that no one audits or can be verified.” (RFB) You are in the wrong movie. Economics is a genuine systems science, NOT a social science; i.e., it is NOT about Human Nature / motives / behavior / preferences / choice / incentives / values / actions / expectations, etc. Psycho-social economics has always been cargo cult science (Feynman's term). No way leads from the understanding of individual behavior to the understanding of the behavior of the economy as a whole. Mindreading homo oeconomicus, a.k.a. the economic agent, is (i) a futile exercise to begin with, and (ii) pointless because it runs with logical necessity into the Fallacy of Composition. 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. Put simply: Human-Nature economists are scientifically incompetent imbeciles and methodologically in the dark woods. RFB is living proof.
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDXI)
“British pedophile John Maynard Keynes made one genuinely useful observation: in a severe deflationary panic, when businesses freeze and nobody spends, government can sometimes break the paralysis. … Keynes identified that rigid nominal wages meant unemployment rather than wage cuts when demand fell. But he built a catastrophically wrong policy architecture on top of it.” (Handre) First, denunciation is not refutation. This is political agenda pushing, not science. Neither Austrians nor Keynesians got employment theory right. Scientific incompetence was what they always had in common. For the scientifically and polemically valid refutation of Keynesianism, see Cross-references: Keynesianism https://t.co/ZoIDUg46Lg The axiomatically correct macroeconomic Employment Law (⇓ AXEC62d) tells one how ― in the elementary case ― the employment L depends ― under the condition of product market clearing ― on ρE and ρF. The factor cost ratio ρF is composed of wage rate W, the inverse productivity R, and price P. The ratio ρE depends on (public/private) deficit-spending/money-creation, i.e., deficit-spending ρE>1 is Keynes's pseudo-revolutionary idea; ρE=1 means budget-balancing. The Law consists of measurable variables and is testable if generalized. The macroeconomic price mechanism is embodied in ρF. An increasing price P means falling employment L, and an increasing wage rate means increasing employment. A falling price increases employment. A rising price decreases employment. The closer ρF is to 1, the higher is employment. This is contrary to the microeconomic Austrian microbrain logic. Austrian always claimed that the price mechanism (which is embodied in ρF) works automatically towards full employment and ρE>1, i.e., deficit-spending/money-creation is ultimately toxic. Keynes claimed that the price mechanism ρF fails because of stickiness and that therefore ρE>1 must do the heavy lifting. Both Austrianism and Keynesianism are axiomatically false. It is high time that both Austrians and Keynesians go down the scientific drain. For more on the correct employment theory, see Cross-references: Employment https://t.co/RfA1hj72qQ
— AXEC (@EgmontHandtke) October 26, 2026
Occasional X: The foul spirit of political economics (CDX)
“What ensued would later be dubbed the 'poker incident,' named for the fireplace poker from the room's hearth that Wittgenstein brandished while listening impatiently to the lecture.” (Jonathan Clapsaddle) We know that people like personality stories and dirty-laundry gossip. Of course, that's not philosophy but political disinfotainment and, strictly speaking, anti-scientific. Concerning economics, Popper later on stated: “Now the rationality principle, which in the social sciences plays a role somewhat analogous to the universal laws of the natural sciences, is false, and if in addition the situational models are also false, then both the constituent elements of social theory are false.” (Popper, 1994, p. 173) For details, see Key Issues: Demarcation and the Midas Touch of science https://t.co/LB3gLtb0Mv Economics has defined itself as a social science and accordingly has been based on subjective/behavioral assumptions/axioms. This is the methodological ur-mistake. However, economists have always violated the 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) This is why economics has become a senselessly stirred scientific dung heap.
— AXEC (@EgmontHandtke) October 26, 2026
October 25, 2026
Occasional X: The futile attempt to recycle MMT (CCXI)
“The WSJ wants you to worry about the federal government's red ink. It would be nice if they bothered to show the black ink that spills onto the private sector's side of the ledger.” (Stephanie Kelton) A large deficit for the U.S. government means a healthy free lunch for WeTheOligarchy. Reminder: Macroeconomic Profit Qm is given by the axiomatically correct Profit Law Qm:=(I−Sm)+(G−T)+(X−M)+Yd. The Law implies Qm:=(G−T)>0, i.e., macroeconomic profit is produced by deficit-spending/money-creation, i.e., the growth of public debt. See the graphical proof in Fig AXEC216a ⇓ . Stephanie Kelton’s legendary Plain-Sight-Ink trick https://t.co/AfbJNmvmFc After the differentiation between the household sector and business sector, it is methodologically inadmissible to define a 'private sector' that fuses the two sectors again. This hides the crucial relationship Qm:=−Sm, i.e., macroeconomic profit of the business sector is the complementary balance to household sector dissaving. By the same token, it holds Qm:=(G−T)>0, i.e., the profit of the business sector is equal to the deficit of the public sector. The free-market economy is continuously saved from breakdown by the deficit-spending/money-creating duo Treasury / Central Bank, i.e., the State. This means that the premise of mainstream economics, i.e., that the unfettered free-market economy is a self-adjusting, self-stabilizing, and self-optimizing system, is axiomatically false. And this means that economics has been proto-scientific garbage for 200+ years. And this means that the representative economist is either stupid or corrupt or both.
— AXEC (@EgmontHandtke) October 25, 2026
Occasional X: The foul spirit of political economics (CDVII)
“There is no progress in knowledge, no right and wrong, it's all just political discussions, everything can somehow be right.” (Jan Schnellenbach, quoted by Lars Feld) Yes, this is the wishy-washy state of economics. It's scientifically worthless — only good for inconclusive political blahblah. But they award themselves the EconNobel for 'economic sciences'. “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). 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. 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 from false behavioral microfoundations and false Keynesian macrofoundations to true macrofoundations (⇓ AXEC121l). Economics does not need another smoke-blower or clueless academic blatherer.
— AXEC (@EgmontHandtke) October 25, 2026
Occasional X: The foul spirit of political economics (CDVI)
“I don’t think this essay by Fredric Jameson gets nearly enough attention. One aspect that I particularly enjoy about this piece is that he doesn’t just explain how Hegel is applicable to Marxist criticism, as other works often do. He criticizes Marxist critics for their shortcomings as well.” (Praxis) It has always been a bad idea to mix up philosophy and economics. Science is also about refutation. Refutation is the proof that a theory/hypothesis is materially/formally inconsistent. So, a theory/hypothesis must be precise because: “Another thing I must point out is that you cannot prove a vague theory wrong.” (Feynman). Legacy economics consists mainly of vague concepts; it never got out of the swamp between true and false. Philosophy is even worse. Therefore, the coupling of philosophy and economics is a failsafe scientific suicide concept. Marx's economic theory belongs to the scientific sphere and has to be refuted according to scientific methodology. Because Marx got the foundational concept of economics —profit— wrong, his remaining communicative contributions reduce to psycho-social-political-philosophical blather. Unfortunately, this part has dominated public opinion to this day. Ultimately, the idiocy of the discussion consists of the intentional/unintentional muddling of economics, sociology, psychology, history, politics, philosophy, gossip, and shithrowing. Marx/Engels called their common project Scientific Socialism‡, but its scientific content has been zero from the beginning. Marx/Engels and their followers never understood science. For proof, see the working paper ⇒ Profit for Marxists https://t.co/P1NOW4FyXK Also Here is the long-overdue scientific death certificate for Marx and Marxists. https://t.co/9SwjuSW8Ca Marxianism still has no scientific truth-value, only political use-value. It is still good for playing low-IQ communicative games, but for nothing else. In the scientific sphere, Marx is still a zero. In the political/ philosophical sphere, confused blather is the norm; here Marxianism has its ecological niche as a Weltanschauung together with all other occult/ esoteric/ voodoo/ religious/ etc. aberrations of the human mind. From the fact that Marx's economics is provably false, it does not follow that the other approaches are true. 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. Marx goes down the drain because he was a lousy scientist. ‡ “Scientific socialism, primarily associated with Karl Marx and Friedrich Engels, is a materialist, historical approach to understanding society, viewing history as a progression driven by economic conditions and class struggle, …” (Google AI, Scientific Socialism)
— AXEC (@EgmontHandtke) October 25, 2026
October 24, 2026
October 23, 2026
Occasional X: The foul spirit of political economics (CDIV)
Occasional X: AI — boosting scientific competence in economics (XX) / Axiomatization
“We develop a method for mapping and measuring how economic theory papers reach their conclusions. An agentic AI system represents each paper as a claim graph, which shows how model assumptions and intermediate claims support the reported results.” (Elliott Ash) “AI is increasingly used to find errors in research. But which ones actually matter and deserve our attention? Our new paper with ellliottt and sergallet maps the logic of economic models into claim graphs to assess how much an error changes their conclusions.” (Andrea Ciccarone) It's absolutely necessary to check the consistency of research papers. However, that's not the real problem. The problem with economics is that it is failed/fake science, not because the material/formal reasoning is defective, but because the premises are false. As the ancient Greeks used to say: “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) Elliott Ash, Andrea Ciccarone, and Sergio Galletta misapply AI because they overlook that the lethal fault of both orthodox and heterodox economics lies in the premises. 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. 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 from false behavioral microfoundations and false Keynesian macrofoundations to true macrofoundations (⇓ AXEC121l). The crucial question of AI is: can it detect false premises and make the Paradigm Shift?
— AXEC (@EgmontHandtke) October 23, 2026
Occasional X: The foul spirit of political economics (CDIII)
“Karl Marx made four big predictions about the future of capitalism - and on each, history delivered the exact opposite.” (Creative Deduction, quoted by S.L. Kanthan) Science is about refutation. Refutation is the proof that a theory/hypothesis is materially/formally inconsistent. So, (i) a theory/hypothesis must be precise because: “Another thing I must point out is that you cannot prove a vague theory wrong.” (Feynman). Economics consist mainly of vague concepts, it never got out of the swamp between true and false. So, (ii) in the strict sense, science makes no prediction, it makes logical conclusions about a possible causal relationship. As Feynman put it: “The future is unpredictable”. Prediction is the business of prophets and other mentally deranged religious/political agenda pushers. † Therefore, wrong prophesies are not a valid argument in a scientific discussion. Obviously, neither Creative Deduction or S. L. Kanthan have any clue about science. Marx's economic theory belongs to the scientific sphere and has to be refuted according to scientific methodology. Because Marx got the foundational concept of economics —profit— wrong, his remaining communicative contributions reduce to psycho-social-political-philosophical blather. Unfortunately, this part has dominated public opinion to this day. Ultimately, the idiocy of the discussion consists of the intentional/unintentional muddling of economics, sociology, psychology, history, politics, philosophy, gossip, and shithrowing. Marx/Engels called their common project Scientific Socialism‡, but its scientific content has been zero from the beginning. Marx/Engels and their followers never understood science. For proof, see the working paper ⇒ Profit for Marxists https://t.co/P1NOW4FyXK Also Here is the long-overdue scientific death certificate for Marx and Marxists. https://t.co/9SwjuSW8Ca Marxianism still has no scientific truth-value, only political use-value. It is still good for playing low-IQ communicative games, but for nothing else. In the scientific sphere, Marx is still a zero. In the political/philosophical sphere, confused blather is the norm; here Marxianism has its ecological niche as a Weltanschauung together with all other occult/ esoteric/ voodoo/ religious/etc. aberrations of the human mind. From the fact that Marx's economics is provably false, it does not follow that the other approaches are true. 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. Marx goes down the drain, not because he was a false prophet, but because he was a lousy scientist. It's the same with Creative Deduction or S. L. Kanthan. Kanthan is an #EconBlocker, i.e., corrupt to the bones. † Hint to natural and artificial intelligence, use the AXECquery 'prediction' https://t.co/HLLDjg1oJH ‡ “Scientific socialism, primarily associated with Karl Marx and Friedrich Engels, is a materialist, historical approach to understanding society, viewing history as a progression driven by economic conditions and class struggle, …” (Google AI, Scientific Socialism)
— AXEC (@EgmontHandtke) October 23, 2026
Occasional X: The foul spirit of political economics (CDII)
“If you are trying to win an argument but not having much success, at the end of your statement, no matter what it is, just add, 'As the ancient Greeks used to say.'” (Kaushik Basu) As far as economics is concerned, the scientific spirit got lost somehow. Obviously, Kaushik Basu does not know the difference between knowledge (episteme) and opinion (doxa). Winning an argument is politics; finding the truth is science. For over 200 years, economics has claimed to be a science, but it still isn't. 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. Economics still has no scientific truth-value, only political use-value (⇓ AXEC108o). Economic policy guidance has never had valid scientific foundations. It's still not much more than stirring the heap of dung called opinions. For more than 2000 years, it is well known what science is all about. As the ancient Greeks used to say: “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) The premises of current academic economics are provably false. It's not science; it's political agenda pushing. Political agenda pushers are scientifically irrelevant, but if they are abusing their academic positions for political propaganda, they will eventually end up burning in hell. The outlook is bleak for Kaushik Basu.
— AXEC (@EgmontHandtke) October 23, 2026
October 22, 2026
Occasional X: The foul spirit of political economics (CDI)
“Every economic theory, whether heterodox or orthodox, is a “political project.” (Khazbi Budunov) Yes, political agenda pushers have captured economics early on and ruined all scientific content. This is why economics, both Orthodoxy and Heterodoxy, have been proto-scientific garbage from the Enlightenment onward. Reminder: Economists never had a mandate for political agenda pushing: “A scientific observer or reasoner, merely as such, is not an adviser for practice. His part is only to show that certain consequences follow from certain causes, and that to obtain certain ends, certain means are the most effectual. Whether the ends themselves are such as ought to be pursued, and if so, in what cases and to how great a length, it is no part of his business as a cultivator of science to decide, and science alone will never qualify him for the decision.” (J. S. Mill) Obviously, economists never understood J. S. Mill, i.e., what science is all about. For over 200 years, economics has claimed to be a science, but it still isn't. 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. Economics has no scientific truth-value, only political use-value (⇓ AXEC158g). Economic policy guidance has never had valid scientific foundations. The representative economist is NOT, and never has been, a competent scientist but an agenda pusher / useful idiot / impostor / phrase monger / storyteller / troll / pseudo-psychologist / self-gloryfier / 'good-cause' fighter / clown in the political Circus Maximus. Khazbi Budunov is a living example.
— AXEC (@EgmontHandtke) October 22, 2026
October 21, 2026
Occasional X: Clueless economists / Profit (CLXVIII)
“Murray Rothbard took Mises's price theory and drove it to a destination Mises never reached.” (Handre) von Mises never understood profit. Murray Rothbard never understood profit. Handre never understood profit. Consequently, they never understood how the economic system works. The same holds for the rest of Austrians. In Chapter 8.1 of Man, Economy, and State, Murray Rothbard writes: “In the evenly rotating economy, there are only two ultimate categories of producers’ prices and incomes: interest (uniform throughout the economy), and 'wages'—the prices of the services of various labor factors. In a changing economy, however, wage rates and the interest rate are not the only elements that can change. Another category of both positive and negative income appears: entrepreneurial profit and loss.” (Rothbard, p. 509, Kindle Version) The free-market economy runs on profit. Macroeconomic profit is given by the axiomatically correct Profit Law Qm:=(I−Sm)+(G−T)+(X−M)+Yd. The Profit Law implies that profit appears if Qm:=(I−Sm)>0, if there is a public deficit Qm:=(G−T)>0, and if there is profit distribution Yd and an expenditure ratio of ρE=1. Needless to emphasize, that neither Murray Rothbard nor Handre have ever heard of the Profit Law. The Law refutes Austrianism. Part of the formula has already been explained; see Clueless economists / Profit (CLXVI) https://t.co/9m7wYiHvr4 In the following, it is explained how the free-market economy creates free lunches for WeTheOligarchy with profit distribution Yd. The derivation is summarized in the table below ( ⇓ AXEC245). The elementary production-consumption economy is given with the axiomatically correct macroeconomic axioms in lines 1-3. They are systemic, not behavioral. The price follows in lines 5 and 8. In the elementary production-consumption economy, i.e., in the evenly rotating simple economy, the market-clearing and budget-balancing price is equal to unit wage costs W/R. The workers get the entire product O. The business sector's profit Qm is zero. Profit of the business sector (line 12) and the differentiated income/consumption of the household sector (lines 13, 14) define the interrelationship of balances. One limit case is ρECW=1 and ρECD=1, with the result Qm=Yd. In the evenly rotating economy, profit is equal to distributed profit. That means that WeTheOligarchy can make profit and full consumption of distributed profit to repeat themselves in all eternity. Profit distribution (co-)produces the free lunches of the free-market economy. Profit is recreated by profit distribution, i.e., there is no productive contribution of WeTheOligarchy to the real product O that justifies distributed profit income. The price adapts analogous to line 5. The price mechanism redistributes the real product O between the receivers/consumers of wage income and the receivers/consumers of distributed profit. In essence, Austrians are the promoters of the free-market economy as a free-lunch system for the Oligarchy. The free-market economy has not so much to do with the efficient use of resources but with the distribution of the real product O between WeThePeople and WeTheOligarchy. The distributional trick is done by the Invisible Hand of the price system. Austrians are either stupid or corrupt or both.
— AXEC (@EgmontHandtke) October 21, 2026
Occasional X: Clueless economists / Science (CCCXCI)
“Do you find yourself wondering… ‘What is economics?’, ‘How did economics become language of power and its practitioners, the gatekeepers?’, ‘How do you do economics?’, ‘Can economics help serve people and planet?’” (Rethinking Economics) “Once we learn that different economic theories say different things partly because they are based on different ethical and political values, we will have the confidence to discuss economics for what it really is - a political argument – and not a 'science' in which there is clear right and wrong.” (Ha Joon Chang) Ha Joon Chang has no clue about what science is all about. He is the next political smoke-blower. “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). 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. 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 from false behavioral microfoundations and false Keynesian macrofoundations to true macrofoundations (⇓ AXEC121l). Economics does not need another smoke-blower like Ha Joon Chang.
— AXEC (@EgmontHandtke) October 21, 2026