Tuesday, November 15, 2011
Posted by dkuehn at 6:02 AM
Is that equation of the two wrong? I don't think so. Here's a great - and disturbing - post from David Glasner on the Fisher Effect. We also have some bad signs from the debt talks, and then there's the whole European implosion thing. I don't think it's going to be a holly-jolly winter, and neither does the San Francisco Fed. One thing I've been pondering more and more lately is "how long do you keep spending time discussing this with people who don't get it?". There are lots of people who get it who just have a problem with the whole Keynes packaging and perhaps some of the politics that go along with Keynesianism - many of the NGDP targeters are like this. But I read this post by Glasner, and I know he is worried about the same problem as I am, and that he has basically the same solution. But many people don't get it - do we still invest time in interacting with them, even if we're heading towards a double dip?? I think you still do.
Karl Smith recently praised "bloodless technocrats" and said "if we are doing our jobs right then people shouldn’t even know that technocrats exist". I have a deep respect for the role that technocrats play. An economy is complex, and when a free society decides to intervene in the economy, it must do so with seriousness and expertise - not following fad or fashion. We need technocrats. But that's only to say that a constitutional, democratic republic ought to make use of technocrats - not that I think a democratic republic would be better off as a technocracy. And a democratic republic can't make use of technocrats if the electorate and the politicians are taken with misleading ideas about the economy, or let ideology guide their view of the economy.
The sciences that deal with highly evolved primates - the social sciences and medicine - are for some reason prone to this sort of do-it-yourself confidence. "Forget what modern medicine says - I can read this book I picked up from Barnes and Noble and heal myself with homeopathic medicine! I can confidently reject vaccination for my kid!"; "Forget the careful work of economists - I'm a freshman in college, and I can learn all there is to know about the laws of human action from Lew Rockwell and the Mises Institute (who needs an identification strategy anyway?)!"; "Forget what psychologists say - I'm a curmudgeonly old Tea Partier that can attribute all human behavior that makes me uncomfortable to a person's values, patriotism, and work ethic!".
These sorts of things can be safely ignored in a technocracy, but not in a democratic republic that utilizes technocrats.