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Quotation of the Day…

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… is from page 50 of the 1990 Transaction Publishers reprint of W.H. Hutt [2]‘s 1936 volume, Economists and the Public [3] (original emphasis):

It is, we suggest, the opponents of those ideas on economics which may rightly be classed as orthodox who are to-day largely the slaves of customary error.  Among would-be reformers, and among even the outstanding writers on political science, there appears to be a complete unawareness of the presence of insufficiently examined yet fundamental ideas in the background of the principles they expound.

Today, no less than 80 years ago when the above passage was first published, people who dismiss basic economics as a guide to reality too-often do their dismissing without understanding basic economics or without examining their premises (or, frequently, both).  Examples are legion.  These examples include, to name only three: (1) the incessant insistence that a trade deficit is a source of net job destruction; (2) the assumption that minimum-wage legislation simply and exclusively transfers some chunk of employers’ wealth or profits to low-skilled workers in the form of higher incomes; and (3) the failure to recognize that the same free-rider and public-goods problems that are said to require government intervention into markets operate also in the political arena, and likely do so with greater force and consistency than they operate in private markets.

It’s understandable, if unfortunate, that non-economists commit sophomoric errors such as these.  But it’s mystifying and distressing that many professional economists commit such sophomoric errors.  (Actually, part of the mystery is dissolved when it is realized that so many economists today do not actually learn much economics.  They don’t learn price theory.  They learn math and statistics – fine subjects to master, to be sure, but mastering math and statistics is not at all the same thing as mastering economics.)

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