I watched an interesting lecture from Chomsky recently. Distorted Morality. It's not about economics, but about history. But I wonder if history is a lot like economics in a certain way. Being non-scientific the professional historian is not constrained to reject his intuitions or biases the way the scientist is. The scientist has methods that more oblige him to accept even uncomfortable truths. I think the economist is more like the historian.
Apparently in 1985 a poll was conducted of newspaper editors on what the most important story of the year was. They decided it was terrorism, particularly terrorism in the Middle East.
Chomsky first defined terrorism, then he asked us to consider the major terrorist events of the year. There were three that he says were way out front in terms of their severity and extent. They were as follows:
1-A bombing near a mosque in Beirut. Apparently ordered by the CIA it was a car bomb timed to go off as people left Friday prayers. It went off as planned and was devastating. Babies in beds far away were killed. Most of the victims were women and girls. The target was not one of the victims. 80 were killed.
2-The so called "Iron Fist" operations in occupied Southern Lebanon by Israel. These were just attacks on what Israel called terrorists in Lebanon which Israel was occupying despite a ruling from the Security Council to withdraw.
3-An Israeli bombing in Tunisia. Israeli attacks are with US weaponry. In the case of Tunisia, this was a US ally, so the US complied by failing to warn them and withdrawing the Sixth Fleet. The UN would immediately condemn the act as that of aggression, the supreme international crime (the US abstained).
But the AP in their discussions of the lead story of 1985 did not see fit to mention any of these terrorist actions. Instead they pointed to two other incidents.
1-The hijacking of the cruise ship Achille Lauro in which the disabled Jewish American Leon Klinghoffer was killed. This incident was said by the hijackers to be retaliation for the incident in Tunisia.
2-The hijacking of TWA flight 847 in which a US Navy diver was tortured and murdered.
Now, to me this is in a sense astonishing. The major terrorist events of the year clearly are American (Israel's actions aren't possible without American backing). Expert opinion (the leading members of the journalistic class, which are like the makers of history) is able to conclude that terrorism in the Middle East is the lead story of the year. Not because our country was responsible for so much terrorism. But because two Americans were killed in two separate incidents.
US terrorism is invisible. Invisible to the experts. And it's not like these things are being hidden. It's not difficult to determine what the major terrorist acts were. The experts still fail to see them and draw the proper connections.
What's going on here? One thing is obvious. These experts have incentives to see our government's actions in a favorable light. And there are no scientific constraints to prevent them from accepting a preferred opinion. It's not like you can do repeatable tests. There are not a lot of predictions to be confirmed. So given that they lack scientific constraints they are now free to indulge their incentives. And those incentives seem to just overwhelm them. The real world facts don't change anything.
History is like that generally. I happen to be persuaded of the view that Jesus Christ was probably a mythical character. I can't have a whole lot of confidence in that view because ancient history is not an exact science. But I've read related books. I've searched for material that rebuts the mythical arguments. I find that they don't really address the key issues. The VAST bulk of the rebuttals are like the following: Historians do not see it that way.
That's true. But like I say, history is not science. In science I can make non trivial predictions and compel unwilling people to accept a position even if they have a preference against it. This is precisely what happened regarding the Big Bang Theory. The scientific community was generally predisposed against it. Big names advocated a steady state model. But the predictions and testing were compulsory.
So consider the field of economics. Once again it's not a science. But this time, unlike the lead story of terrorism in 1985, the facts are not right on the surface. If the historian can so easily ignore reality when the facts are easy to see what should we expect of the economist? His response to biases and incentives will be even worse. Because tests can't be controlled predictions can never really be confirmed.
So let's take supply side economics. If you give rich people more money they'll invest, create jobs, and the rising tide lifts all the boats. Let's cut regulation, cut taxes, give the rich more and see how it goes. And so we tried it. What happened? You couldn't ask for a bigger colossal failure. We got the tons of money in the pockets of the rich part. That other part where benefits are enjoyed by everyone else? Didn't happen.
But that's OK says the neoliberal. Maybe we didn't de-regulate enough. Maybe we didn't cut taxes enough. Let's double down says the tea party crowd. Let's do it even more. You can't be sure it didn't work because you can't control for every variable.
HP is kind enough to share what expert opinion is on economics. The key to the success of places like South Korea has been neoliberalism, says HP. All of this is so obvious and such a standard position amongst economists that HP has difficulty even talking with me about it. If you're going to deny this you might as well deny global warming. It's very difficult to even bother to take the time to talk with flat earthers and 9-11 truthers.
Sure, I deny that South Korea followed the neoliberal model. But to do so HP is quick to point out that I must rely on heterodox economists not the mainstream ones. Like the South Korean economist Ha-Joon Chang.
But then look at the facts Chang puts on the table. He did grow up in South Korea (now he teaches at Cambridge). He tells us that South Korea had aggressive restrictions on imports. That's a radical violation of neoliberal principles. They put restrictions on citizens that attempted to invest overseas rather than in internal South Korean companies. The penalty was kind of severe. Death. They would frequently intervene in company affairs, taking over companies, sometimes firing the management team, then restructuring the company and sometimes turning it back over to market forces. They would acquire foreign currency and use it for the purchase of only one type of goods. Technologically advanced industrial products. Using that money to even buy foreign cigarettes was illegal.
Chang isn't mainstream!! OK. Where is he wrong on the facts? Are these claims he makes all lies? HP doesn't even try to deny the facts. Chang is out of step with orthodoxy. That's what matters.
Expert opinion does matter. I'm not saying it doesn't. I'm also not saying that my own economic conclusions aren't subject to this defect. For instance you could point to the fact that the US economy was subjected to Keynsian stimulus following the recession and you could say it doesn't seem to have resolved things and I can always say the stimulus wasn't big enough.
The point is economics is not science. In science we have better means of overriding a bias. In economics we don't. So trusting a scientific consensus is different from trusting an economic consensus. The economic consensus matters less. Therefore I am justified in relying more on my evaluation of the evidence in the case of economics than I would be in the case of a science, like global warming. For our expert journalistic class it seems they miss things even when it should be obvious. Economists are similarly unconstrained by scientific methods. They should be viewed similarly.