Friday, April 21, 2017

James Kwak — How Ideologues Use Grade-School Economics to Distort Minimum Wage Debates

Economism may not accurately describe reality, but its reduction of complex phenomena to simple concepts was a major asset in the battle of ideas. The political landscape of the United States after World War II was dominated by the shadow of the New Deal and the idea that the government could and should pay a major role in managing the economy. Businesses that opposed intrusive regulations and wealthy individuals who feared higher taxes needed an intellectual counterweight to the New Deal, a conceptual framework that explained why an activist government was bad not just for their profits and their pocketbooks, but for society as a whole. Economism filled that need.…
In short, conventional economics is propaganda for an ideology rather than being a science as advertised. "Simplify and conquer" was added to "divide and conquer."

How Ideologues Use Grade-School Economics to Distort Minimum Wage Debates
James Kwak | Associate Professor of Law at the University of Connecticut School of Law

1 comment:

Schofield said...

Why does James Kwak make no mention of Keynes's misnamed "Effective Demand" theory (should be "Uncertain Demand" theory or something similar)? Failure to do this is a missed opportunity to debunk Libertarian economists like Hayek and Friedman. Randall Wray in his 2016 book "Why Minsky Matters" tells us that Minsky recognised Keynes's central message from "The General Theory" that market capitalist economies need "circuit-breakers" or rather I would argue "circuit-regulators."