Sunday, March 10, 2013

The Art of Connecting Far Apart Actions to Consequences

If you were to ask a random selection of people to explain each and every action and successive event that occurs under the hood of a car from when you turn the key to the point that engine is running, I believe maybe no more than 2% of the people could do it.  Most people just know “you turn the key and the car goes vroom.”  But just because they don’t understand all the intricate details and events occurring under the hood, doesn’t mean they don’t know how to use cars.  Everyday millions of people use vehicles they seldom mechanically understand, and thusly their lives are dependent on technologies and processes they are ignorant of.

Computers are another example.  Unless you’re in computer engineering or a computer networker, most people just know how to turn a computer on and use a point-click-interface.  They have a theoretical understanding of how the internet works, but very few people understand binary, routing, electricity, computer processing and all the other processes and mechanics that go on behind the screen.  Again, our lives are heavily reliant on processes and events we rarely understand. 

Now this isn’t to slam on people who don’t know how to fix cars or don’t know the basics about computers.  The truth is such complex processes like starting a car engine or sending an e-mail are the result of a specialization of labor and a specialized economy.  An auto mechanic may know in intricate detail how engines work, but could never hope to fix a computer.  And a computer engineer may know how to create a circuit, but is hopelessly lost when it comes to making a soufflĂ©.  No one person knows everything about every trade and process. However, there is one field or “system of complex processes” that everybody SHOULD know about and familiarize themselves with – economics.

Admittedly, economics is boring (or at least it is to most people).  And the reason most people find economics to be boring is because there aren’t enough intriguing, dashing, charismatic and interesting economists like me out there.  Most are boring, dull, dry, and truth be told, most economists don’t even know THEMSELVES how economies work, and thus fail miserably to convey just how exciting and interesting economics truly is.  But making economics even more distasteful to the potential student is that it is complex.  And when faced with the daunting task of mathematically and precisely figuring out how “fractional reserve banking leads to inflation,” most people’s minds prefer to just “turn the key and hope the car goes vroom.”

There’s just one problem.

Who fixes the economy when you turn the key and it doesn’t go “vroom?”

Well, let’s test you with a multiple choice question.
a.    The Federal Reserve
b.    The Federal Government
c.    Congress
d.    The President
e.    The people
The answer is e – the people.

The reason why is that since this is a democracy and we vote in our leaders, we are ultimately responsible for putting the right people in office.   And by “right people” I mean people who make wise decisions and effect wise policy that helps the economy growth at its maximum level.  But when people are so ignorant about basic economics, to the point it’s like Bambi the Trophy Wife misdiagnosing why her Lexus SUV won’t start, we don’t send the “economic-mechanics” we need to fix the economy, but rather equally-ignorant politicians who promise us nice things.  In other words the mechanic who brings us bad news, telling us the engine needs to be replaced for $2,000, is booed and hissed at.  While the mechanic who brings us good news, telling us there’s nothing wrong and that there won’t be a charge, gets applauds, accolades and a public office for life.

The solution would seem simple – get people interested and educated about economics.  But there are two main hurdles to this challenge.  One, most people are WILLFULLY ignorant.  Even though there’s smoke billowing out of the engine, they will ALWAYS go with the mechanic who lies to them because that’s what they want to believe.  No amount of reason, sanity, proof or logic will ever break through their brainwashed skulls.  Two, requesting the average person learn economics to the point they’re reasonably fluent in it, is as intimidating as asking Bambi the Trophy Wife to get underneath her Lexus, get greased up, and change her own oil to the point she can do it on her own.  It’s daunting. 

Alas, why The Art of Connecting Far Apart Actions to Consequences is a must for any conservative or libertarian cheerleader of free markers. 

You need to not only be able to understand economics yourself, you need to be able to convey it clearly to others who are not so fluent.  You need to be able to take complex economic processes and theories and boil them down to simple, but brilliant “bumper sticker-eqsue” founts of knowledge and fact that disproves what most leftists believe.  You need to be able to read a Paul Krugman piece, dissect it, find the piece of data or theory he’s spun intentionally and maliciously and THEN explain in under 5 minutes to the average layman why Paul is a shill AND get that layman to understand it.  It is in taking the seemingly complex processes and theories of economics and making them not just palatable, but simple and understandable, you will deliver the single largest blow to socialism and leftism you possibly can. 

However, there is an even more important reason in making economics as clear and as simple as possible:

Leftists, socialists, and career politicians of all political stripes, rely on the complexity of economics to mask and hide their ulterior motives. 

Understand the single largest advantage the left has over a low-information voter population is the complexity, boringness and intimidation of economics.  I termed it the “GLEOC” (Great Liberal Economic Oort Cloud”) where most people view the economy and government as some amorphous entity where “really smart people, WAY smarter than them” know what to do and are doing everything they can in some kind of Keynesian, mixing things up, primordial goo, sort of way and hopefully the GLOEC farts out some jobs (actually, quite identical to the medieval days when only the “learned and wise” members of the clergy were allowed to read the bible and the masses could only learn of Christianity through their self-serving prism of teaching under penalty of death).  Regardless, the GLEOC is WAAAAY too complicated for sheeple like them to understand, and why bother?  Kate Perry is on! Unfortunately, the left hides it political agenda within this ambiguity, mentally removing the people so far from their intentions, they get away with it scot free.  But if you were to explain away the GLEOC (and allow the masses to read the metaphorical “economics bible”), and get enough people to truly understand how economics works, you remove this ambiguity and expose them for what they truly are – thieves.

And yes, the leftist ideology is really that simple.


Anonymous said...

I sincerely doubt more than 10 percent of Americans can adequately explain how a disposable lighter works, much less something as complicated as the internal combustion engine.

Dave said...

Expecting everyone to understand economics is as unrealistic as expecting everyone to understand computers. The only solution is to separate economics from politics, just as we separate religion from politics.

This will be accomplished when the dollar collapses and the world returns to precious metal as a medium of exchange, unit of account and store of value. Voters and politicians will always have silly ideas about economics, but without real money to back them up, these ideas will fall harmlessly flat.

StephUF said...

I'm in. I have Enjoy the Decline, Behind the Housing Crash (both on Kindle), not sure how to get it down to 5 minutes.

Richard Blaine said...

Nicely put.

BTW, I can in fact tell you in excruciatingly boring detail how a computer works, having put 3 years into an EE degree before switching to Comp Sci. Also Having worked as an Electronics Tech for 5 years, and software for more than 20.

I can also tell you how a car operates, and fix it myself - having done engine rebuilds, carburetors, transmissions, differentials, brakes, suspensions, electrical, body work, painting - ah no upholstery though.

Oh and I have a degree in Economics :)

So, if you don't believe the Captain - you should, he's right.

Factory said...

The Canadian 'technicality' that could lead to real lasting change? Out 'House of Commons' is supposed to be just that...a Parliament of regular folks. The Senate is supposed to be the 'Professional Classes' like Lawyers and Doctors and such.

The original intention was that the House of Commons would draft Law to reflect the will of the people, while the Senate would exercise Noblesse Oblige, and help the plebes get it right by vetoing and refining legislation and sending it back to the Commons to be resubmitted. All of this done under the watchful eye of the Representative of the Queen (who ensures The Empire benefits over all).

Frankly, this is the best setup I've heard of...if only we would actually do it.

This leads me to believe one simple class that has been eliminated from education would go a LONG way to fixing a lot of our problems.


Anonymous said...

Fostering understanding in general is difficult. I've had a little success. Thomas Sowell's discussion of why rent controls end up devastating poor renters is effective because it is amusing. And the question, "how do you make a pencil" can lead to a little understanding of the free market pricing system and the economic wreckage which follows without it.

Dan said...


Liked the post and for the most part it's accurate. The one statement I take exception to is
your blaming "the people". You
state that we are responsible for
what happens from government because of who we vote for. This may have been the case decades ago but is now not true. Those who truly run things...the people in power who NEVER stand for elections have gamed the system and rigged the machine so that the odds of someone winning an election who isn't firmly under their control are akin to you winning the Superlotto. Voting is
far far too dangerous to those in
power to be left uncontrolled. As the old aphorism states "if voting actually mattered it would be illegal".

Eric Mueller said...

I used to consider economics boring, difficult, and esoteric, until I started studying it. I'm finding it's not the economics that is complicated; it's the layer of political BS thrown on top of economics to justify what is going on.

I'm also finding economics is really simple math. The laws of math don't just stop applying because you're on a "macro" scale.

But the nation is full of people who somehow believe on a larger scale, debt equals growth. They will not be convinced otherwise. The only thing left to do is enjoy the decline. Great book.

Anonymous said...

Most people are willfully ignorant on most topics and most folks should not be allowed to vote.

No issue will ever be seriously addressed as long as we have universal suffrage


Martel said...

Economics is fundamentally the science of common sense as it relates to money. There are a couple of counter-intuitive principles, but most of it is simply using numbers to observe people doing what they do.

Because leftism is built on the fantasy of "people should be" instead of the reality of "people are", their econ is a projection of this wishful thinking. The government can create more money, but only we can create more value. Leftists want to think that THEY are societies prime movers, so they act as though they can "stimulate the economy" and "solve problems". This fantasy only creates more problems for them to solve.

I don't care how many prizes he's won, Krugman knows less about economics than the guy who runs the pizza joint down the street. Pizza guy knows reality, Krugman charts and graphs pipe dreams.

AntisocialMisanthropicPessimist said...

I think the reason most people find economics boring is that most people are idiots whose only concerns in life are getting their dicks sucked by the easiest human seal they can find.

Anything that doesn't involve social signaling and tribal circle jerks has trouble attracting the crowd.

BA said...

Can you point out some good books to improve my economic knowledge?

sth_txs said...

I know we covered something about economics in high school, but I can't remember much of it. I made it a point when I started a real job to read some Mises and Rothbard though my MBA friends only believe the junk they are taught in MBA schools which makes functionally stupid about what is money.

Bastiat would probably be a good thing to have them read.

Other than that, the only shows on TV that promote a positive look on business and show some economics in action is on the History Channel with Pawn Stars, American Picker, and the maybe the ones about the gold mining. I would include Ice Road Truckers and Swamp People not because of deep economics but because it shows there is goodness in wanting to do better for yourself and taking pride in your job and working for yourself.

Anonymous said...

"The economy’s not a car, there’s no engine to stall
no expert can fix it, there’s no “it” at all.
The economy’s us, we don’t need a mechanic
Put away the wrenches, the economy’s organic"