Saturday, March 01, 2008

Discover Your Inner Economist

I can't recommend this book by Tyler Cowan. I'm sure the guy is hugely intelligent and would be a lot of fun to chat with, but the book has such a complete lack of focus that it was hard to make it through.

He makes some points that I was relatively familiar with, but they are worth repeating:

"I believe we must learn what can be obtained by exchange-monetary or otherwise and what we cannot trade for. The central concept of economics is not money but rather incentives. Quite simply, an incentive is anything that motivates human behavior, or encourages an individual to make one decision rather than another."
"One of the most important lessons of economics is how to cope with scarcity. Economics developed out of a recognition of that fact that many things worth having don't just fall into our laps in the course of our everyday lives. The real purpose of economics is to get more of the good stuff in life."
"It is a profoundly important fact that you can't understand how incentives work if you don't understand the importance of a respect for human liberty"

I'd argue that the last point is the point at which liberals really part company with economics. To them, "human liberty" would actually mean "freedom from incentives" - all the "good stuff" would be a "right" and incentive could be better described as "a whim". What they believe they want is a "right to happiness", not a "right to PURSUE happiness". They mistake liberty for entitlement and fail to realize that the result of their pursuit is TYRANNY. Equality of opportunity is heaven, equality of result is hell.

They also tend to lament "how important money is", which means that they understand neither money or life in the US today, since we still have a good deal of personal liberty. Nobody is forced to drive, use electricity, modern medicine or much of anything in our society. Availability of something is neither encouragement or license. The success of our system creates huge OPPORTUNITY, and if one wants to take advantage of those opportunities, THEN money is very useful. It is however YOU that makes that money "important" by what parts the overflowing cornucopia of goods and services you feel "incented" to want.

To live in a culture with liberty means that some will find that money is "too important"
and others will find that leisure or religion or education or books or computing or technology or environmentalism or politics or ?? is "too important" or not important enough. That is essentially what liberty means-"the freedom to think or be different", and as long as liberty exists, there will be disagreement-on priorities, limits on liberty, etc.

Liberals tend to see the "best way" to get our country back to be "less divided" is to remove some liberty-by say re-establishing the "fairness doctrine" so a set of conservative views were no longer presented, removing this blog from the internet, reducing the number of kids that are home schooled or in private schools, taking some money away from those who earn it, or 1000s of other ways.

We live in a looking glass world where "liberals" as strongly put off by the availability of Fox news, talk radio or internet blogs. "Liberal" may be a nicer sounding name for that sentiment, but what it is really is TOTALITARIAN. Liberty means MORE difference, dissension, argument and disagreement, not less!

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