Economists should be the butt of more jokes than they seem to be. They are notorious for being able to see at least two sides of any argument, not least because for much of their work there are two sides–demand and supply. A weak but pertinent joke is that if you want a clear answer from an economist find one who is one-handed. That way he or she cannot say ‘On the one hand…on the other hand’. But that ability to see various sides means that economists can also be fairer in assessing situations. It also means that economists can roll around to their hearts’ content disagreeing with each other, by seeing the other side of arguments or using different assumptions and just going off on their own journey, never to meet their counterpart again. Not many whom I know do that for fun, but they can do it for what they deem to be deep-seated beliefs in how economies and societies work.
Discussion of economic policy is always raging, and in the US we’ve seen how economists (but also politicians, though they are a different breed) can disagree on what is happening; whether certain changes are good or bad; who will gain or lose, and more. Take this week’s decision to extend the Bush-era tax cuts. Some will see this as giving the US economy another shot of stimulus as more dollars stay in people’s pay packets (now there’s an old-fashioned term) and we hope that they will spend more of that, rather than save it. But, some will see that same stimulus as reducing the need for the Federal Reserve to shoot off its quantitative easing bullets so perhaps withdrawing a different source of expected stimulus. What will be the case on balance? More, less or no change in stimulus. We can try to estimate the effects, and economists will. Watch for the comments in coming weeks. But, behind that extended tax break in the dark apocalyptic horse of the US Federal deficit. The tax break means less revenue, and probably an increase in the deficit or at best no likely reduction. Time for more estimates.
Many democratic countries–for reasons that defy reason–choose to follow economists as their leader. I do not know how many or where the majority are, but anecdotally I can find a good few. (If there is something to be said for the world of applications, it’s to be able to track trends, so developers please work on a political leadership aptitude app.) Mexico is one country that comes to mind as having had more than a fair share of economists as presidents and political leaders in recent decades. Presumably, they feel that people who supposedly understand how the economy works and how choices are formed and resolved will be good at taking people along a road that is often all about dividing the spoils–even if, as now, the spoils to be divided, are really slim pickings. When a country is mired in economic woes it may seem more than sensible to have an economist to lead the way out, as haggling over the national purse strings is likely to intensify.
Other countries shudder at the thought that economists could be their standard-bearer in the battle to win hearts and minds, or the decision-maker of decision makers, opting instead for those with legal training. That is more the norm in the US. Even though I may be quick to argue that lawyers are boring, people seem to shrug off any such accusations and plump their finger in the ink to mark an X for legal eagles. That, too, makes some sense given that government is often about legislation. Funnily, people with business experience only rarely come to the fore of those whom people seek to lead them. Is that because they have more sense than to set themselves up for failure by going for elected office? Or is it that they realise that it’s easier to keep fooling most of the people most of the time by giving them goods and services? Doctors and people of holy orders know that they are saving more lives and souls by staying in surgeries or places of worship. So-called ‘ordinary citizens’ rarely seem to want to be part of the elective fray (though some movements get a smattering of such candidates coming to the fore).
We know the phrase ‘In the land of the blind, the one-eyed man is king’. Should that make the two-eyed, two-handed economist a superhero? Somehow, I don’t think most people will agree with that notion.