JAMES KWAK ~ ECONOMISM

~ BEATROI ~ Bad Economics And The Rise Of Inequality

~ E-ROTPT-PCAM-BAT-TA-TDIOAE101T-ETTABTDVNHTITRW ~ Economism – Rests On The Premise That – People, Companies, And Markets – Behave According To – The Abstract – Two-Dimensional Illustrations Of An Economics 101 Textbook – Even Though The Assumptions Behind Those Diagrams Virtually Never Hold True In The Real World

~ EIAILTWPMSOR-BICTAO-‘E’-ECBAPRT ~ Economism Is An Interpretive Lens Through Which People Make Sense Of Reality – Because It Claims The Authority Of – “Economics” – Economism Can Be A Powerful Rhetorical Tool

~ WSEACSMP-ITWTMOJTESO-ATITIG-WETFOAATCI ~ While Superficial Economic Arguments Can Serve Multiple Purposes – In Today’s World They Most Often Justify The Existing Social Order – And The Inequality That It Generates – While Explaining The Futility Of Any Attempt To Change It

~ RARWQTSMAATITST-ITS-EILAI ~ Reducing All Real-World Questions To Simple Models And Answering Them In The Same Terms – In This Sense – Economism Is Like An Ideology

~ TCJFGDOW-INLTTSHWDBG-OTTSOTFIRFTPOTS-I-IIN-EC-BIITNOOAESTPTGGTTGN ~ The Common Justification For Great Disparities Of Wealth – Is No Longer That The Social Hierarchy Was Dictated By God – Or That The Survival Of The Fittest Is Required For The Progress Of The Species – Instead – Inequality Is Necessary – Even Celebrated – Because It Is The Natural Outcome Of An Economic System That Provides The Greatest Good To The Greatest Number

~ TAOETPAASRTRDIOSOIS ~ The Ability Of Economism To Pass As Abstract Science Rather Than Rhetorical Device Is One Source Of Its Strength

~ EIAIBOISEAEP-ACUPOTW-WCBCQAE-DWMAUF ~ Economism Is Also Influential Because Of Its Sedative Elegance And Explanatory Power – A Clean, Uncluttered Picture Of The World – Which Can Be Communicated Quickly And Easily – Dispensing With Messy And Uncooperative Facts

~ ASSOAC-BOAUA-HBSWICS ~ A Small Set Of Abstract Concepts – Based On Admittedly Unrealistic Assumptions – Has Become So Widespread In Contemporary Society

~ IALETMACITAWOSADC-TIIITRWOPAI ~ It’s A Lost Easier To Make A Case In The Abstract World Of Supply And Demand Curves – Than It Is In The Real World Of People And Institutions

~ IGPPWTBUTAISOS-WTSTIOTG-OPIWAFIOTW ~ Ideas Gain Power Precisely When They Become Useful To An Important Segment Of Society – When They Support The Interests Of That Group – Or Provide It With A Favorable Interpretation Of The World

~ EEBPAOSHTCUBEPTTA ~ Economism Exists Because People And Organizations Saw How They Could Use Basic Economic Principles To Their Advantage

~ AWFFBMEIP-MDCRTEI ~ As Wealthy Family Foundations Became More Engaged In Politics – Many Devoted Considerable Resources To Economic Ideas

~ BBTPO-PT-SI-AWP-TECTAJDUE-ASOTET-T-CCTBUWEFTPOPTO ~ Befuddled By The Popularity Of – Progressive Taxes – Social Insurance – And Welfare Programs – These Entrepreneurs Concluded That Americans Just Didn’t Understand Economics – And Set Out To Educate Them – Today – Commentators Continue To Blame Unfamiliarity With Economics For The Popularity Of Policies They Oppose

~ MICWDNSIEIARATVOE ~ Many Influential Commentators Who Do Not Specialize In Economic Issues Also Routinely Adopt The Vocabulary Of Economism

~ TMNEBMIASWOPADSAEI ~ The Media Normalize Economism By Making It A Standard Way Of Presenting And Discussing Social And Economic Issues

~ TFTCCWOUSBFE101-DTPVOE-IOTATSR ~ The Fact That Candidates Can Win Office Using Sound Bites From Economics 101 – Demonstrates The Political Viability Of Economism – Inspiring Others To Adopt The Same Rhetoric

~ EFBAAEDTAAAWODAFTRI ~ Economism Functions Both As An Effective Debating Tool And As A Way Of Distracting Attention From The Real Issues

~ ATPOE-TPRITBBAWEP-R-LIBASIAM-YMWYD-EPTPJFT-W-T-A-RS-ALFTWPOV-H-WHRMMSTP-TDHTPTPLADBNP-NPP ~ According To The Principles Of Economism – The People Raking In The Big Bucks Are Worth Every Penny – Remember – Labor Is Bought And Sold In A Market – You Make What You Deserve – Economism Provides The Perfect Justification For The – Winner-Take-All – Reward Scale – At Least From The Winner’s Point Of View – However – Wages Have Risen Much More Slowly Than Productivity – This Divergence Highlights The Possibility That Pay Levels Are Determined By Negotiating Power – Not Pure Productivity

~ ECRPFS-AGTINJTWBAOPWRFAIITSM ~ Excessive Compensation Reduces Profits For Shareholders – A Group That Includes Not Just The Wealthy But Also Ordinary People Whose Retirement Funds Are Invested In The Stock Market

~ ALTSTT-TCBMBI-CCETMDTMTBBHTCITLR ~ Awards Linked To Short-Term Targets – That Can Be Manipulated By Insiders – Can Cause Executives To Make Decisions That Maximize Their Bonuses But Harm The Company In The Long Run

~ FC-WSGWHBACPQ-ERTQFTPSTTAROT-IWTCLMPTPIS ~ For Centuries – Who Should Get What Has Been A Central Political Question – Economism Removes The Question From The Political Sphere To The Abstract Realm Of Theory – In Which The Competitive Labor Market Provides The Perfect, Indisputable Solution

~ OOTCPOEITTA-VVB-AU-YCMTAEUAS-A-DD-TITHTDPFWATMSWOIPTSMDETOE ~ One Of The Core Principles Of Economism Is That Taxes Are – Very, Very Bad – As Usual – You Can Make The Argument Easily Using A Supply-And-Demand Diagram – The Idea That Higher Taxes Discourage People From Working And Therefore Make Society Worse Off Is Probably The Single Most Deeply Entrenched Tenet Of Economism

~ TOIIHFPITUSOTPSY-WNOIIESOG-TEEMRIT1950A1960-APWTTROMIIW70%OH ~ Taxes On Investment Income Have Fallen Precipitously In The United States Over The Past Seventy Years – With No Obvious Increase In Either Savings Or Growth – The Economy Expanded Most Rapidly In The 1950s and 1960s – A Period When The Tax Rates On Most Investment Income Were 70 Percent Or Higher

~ TROCGHHLIEOSOOEG ~ Tax Rates On Capital Gains Have Had Little Impact Either On Savings Or On Economic Growth

~ MPABUOTTR-MHBFDABNOSCIROR-BOPR-SA-‘SWILOAE’ ~ Many People Are Blissfully Unaware Of Their Tax Rates – Most Human Beings’ Financial Decisions Are Based Not On Sophisticated Calculations Involving Rates Of Return – But On Primitive Rules – Such As – “Save Whatever Is Left Over After Expenses”

~ LTRITAOMTTGHTB-RTCATTPS ~ Lower Tax Revenues Increase The Amount Of Money That The Government Has To Borrow – Reducing The Capital Available To The Private Sector

~ TSMSTLITWISAGDHUTS-LPKMOTSDNAMTTWM ~ The Simple Model Saying That Lower Investment Taxes Will Increase Savings And Growth Doesn’t Hold Up To Scrutiny – Letting People Keep More Of Their Salaries Does Not Always Motivate Them To Work More

~ AGISAMBWWOCAOSTWDNTTPSTLAE-ASTQOWTAWDOWFWEFOGAHWIFT ~ A Government Is Simply A Mechanism By Which We Organize Certain Aspects Of Society That We Do Not Trust The Private Sector To Look After Effectively – And So The Question Of Whether Taxes Are Worthwhile Depends On What Functions We Expect From Our Government And How Well It Fulfills Them

~ TGPOAWITSTBOWPBIEP ~ The Greatest Power Of A Worldview Is To Set The Boundaries Of What People Believe Is Even Possible

~ ERMFTPHBIACWBIAWOE-IFC ~ Economism’s Rosy Model Failed To Predict How Both Individuals And Companies Would Behave In A World Of Ever-Increasing Financial Complexity

~ I2008-WRTLTACMDNMETCFTIMPU-I-P-SBLBPACTMTIGIWTDLDAWR-SOATMS ~ In 2008 – We Relearned The Lesson That A Competitive Market Does Not Magically Ensure That Capital Flows To Its Most Productive Uses – Instead – Profit-Seeking Behavior Leads Both People And Companies To Maximize Their Individual Gains In Ways That Distort Lending Decisions And Waste Resources – Sometimes On A Truly Monumental Scale

~ TMTNCALAMCTE-A-CRASTLTETTBWSTNCI ~ The Megabanks That Nearly Collapsed Are Larger And More Complex Than Ever – And – Capital Requirements Are Still Too Low To Ensure That Those Banks Will Survive The Next Crisis Intact

~ IARWLM-TADCCL ~ In A Real-World Labor Market – Trade Agreements Do Create Clear Losers

~ TGAOEHBT-RAPI-AAL-E-T-U-SN-FFSTW ~ The Great Achievement Of Economism Has Been To – Repackage A Political Ideology – As A Lightweight – Easy-To-Use – Seemingly Neutral – Framework For Seeing The World

~ BCTSOAT-EDTTIADAA-TWSITWII-IYDA-YMNUE101 ~ By Claiming The Status Of Absolute Truth – Economism Denies That There Is Any Debate At All – The World Simply Is The Way It Is – If You Don’t Agree – You Must Not Understand Economics 101

~ EPAIRIOCPI-PCTOAAA-WPOTTM ~ Economism Plays An Important Role In Our Contemporary Political Institutions – Prioritizing Certain Types Of Analyses And Arguments – While Pushing Others To The Margins

~ FASTBR-CMANE-TMAB-PDPI-TPEF-MP-SC-A-SAESOR ~ For A Society To Become Rich – Competitive Markets Are Not Enough – There Must Also Be – Pluralistic Democratic Political Institutions – That Prevent Elites From – Monopolizing Power – Suppressing Competitors – And – Seizing An Excessive Share Of Resources

~ U-IWTANWTDBWTO ~ Ultimately – It Will Take A New Worldview To Do Battle With The Old

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