So says Peter Preston.
The illusion, for us outsiders, is that economics is at least a bona fide social science – not an actual science (in Einstein ways) or an argumentative science (in Greenland glacier mode) but at least quasi-scientific in its disciplines and rules of thumb. Reality, in a world of competing prescriptions and mounting adjectival excess, would appear to advance a fardifferent case. Some people think they know something. Some people believe quite another. Most people don\’t really follow either side (or quite understand what they\’re saying). Everybody has a view. Virtually everybody can convince themselves that they\’re right. But look at the record and stress the words \”knows\”. Nobody knows anything. Lights, music … curtains.
Given that Preston was Editor of The Guardian for 20 years this might help explain some of the economic positions The Guardian has taken over the years.
There\’s areas where we certainly don\’t know very much, this is true. These tend to be the macroeconomic areas: interest rates, recessions, unemployment and so on.
There are other areas where we know quite a lot: microeconomics. The theory of price, the firm, incentives.
There are even areas where economists are pretty much united: in favour of free trade and against rent control for example. Note that those are the areas where economists have the least impact upon public policy.
But OK, let\’s take Preston as having really put his finger on the point: economists don\’t kno nuffink. It\’s all just matters of opinion, pre-ordained prejudices determining economic views.
That\’s pretty much the end of the Statist project then, isn\’t it? As no one knows no one can plan. Bureaucrats and politicians are as blind as the rest of us, more likely to lead us off the cliff than to those golden uplit highlands (for there are obviously many more ways of being wrong than of being right).
Which is an interesting point: if no one knows then the only possible course is a rigorously free market economy, for in the absence of knowledge how can you know that you\’re doing the right thing in curtailing this or that, planning for the other or regulating the third?
But, but, comes the answer: we do know that we cannot just have a free for all! OK, therefore we do know something and it isn\’t true that economists kno nothing then, is it?
So let\’s have the things that economists are most certain that they do know: free trade and an absence of rent control: we can move on to other things once you\’ve agreed with those.