The road to hell is paved with good intentions.

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Challenges for Economists and for the Economics Profession

All accounting is boring, most fishing is boring, and pulling weeds from a field of corn is both tiring and boring. Economics, however, is too important to be relegated to the boring heap. It has been called the “dismal science,” not so much because it is boring, but because many of those us who call ourselves economists are boring. They (not we) love to publish arcane papers that few outside their immediate circle ever read—or can read, or want to read—while believing they have satisfied their obligation to society to make it a better functioning place for everyone. Fiddlesticks! They need to wake up and do something important, inspiring, and worthy of their place in society.

If I had to reduce my complaints about those silent economists into a single gripe it would be this: They are too afraid of the consequences of being honest. That description incorporates the terms lazy, complacent, boring, self-absorbed, and tiring to the spirit among other descriptors. My reasons for holding them accountable is because my sense of honesty and fair play cannot grasp why anyone would commit him/herself to years of advanced education, training, and experience, to become highly skilled at their craft, only then to look around and see an economic system that is grossly underperforming, pathetically inefficient, replete with obstacles that prevent it from making and distributing products and services at fair prices without doing something about them; then to watch as oligopolies transform into gigantic corporations, as banks amass undeserved power and wealth, as competition dries up, as unemployment hovers at high levels, and as inequality of wealth and income skew themselves into plutocratic obscenities; thence to watch the American Dream become replaced by poverty’s squalor for an enormous chunk of our population—while saying and doing almost nothing specific about any of these outcomes that the ordinary person can understand, can relate to, and will support. I make an exception for Robert Reich who has found his stride as a brilliant spokesperson for bringing sanity into the American workplace, and for getting off his duff and performing most of the aforementioned tasks with pizzazz.

Case in point: Far and away the biggest factor behind all the above bottlenecks is this: Too little new money created by the Fed gets into circulation, while too much of that same money gets into the personal investment accounts of the wealthy. The reason is clear to anyone who has the barest understanding of the connection between money and economic growth. A dollar in circulation creates 6 to 10 dollars of GDP, plus new jobs, new incomes, and new tax revenues while reducing a host of social ills associated with poverty; conversely, a dollar put in an investment account creates almost zero GDP, zero new incomes, zero new jobs, and zero new tax revenues while exacerbating a long list of social ills. Now, name one economist—anywhere—who will convincingly refute that statement, and I will personally donate money to his/her favorite charity while publicly commending him for his brilliance and insight. As an example of the apathy that permeates the economics profession, I personally contacted the one Ph.D. economist at the Federal Reserve System who is responsible for monetary policy and inquired about the Fed’s lack of enthusiasm for making that one change that would have such a monumental effect. Her response: “That is not my area of expertise. But you can read various and assorted papers on that subject filed in our archives.” I suppose that every one of those 100+ Ph.D. economists at the Fed could and would make the same kind of dismal comment when asked a similar question that fell within their scope of responsibilities. Perhaps they are forbidden from speaking or supporting the truth. Or they are too frightened to do so out of fear of being replaced, relocated, or retired prematurely. Fiddlesticks! They need to wake up and do something important, inspiring, and worthy of their place in society.

In more or less their order of importance, here are other changes that can and will correct most of the economic issues in America that need to be fixed. 2) A fully functioning economy depends on a literate and skilled workforce. To that end we need to make higher education (academic or trade) free for everyone. 3) Size restrictions must be placed on banks and on corporations (many need to be separated into smaller units while future mergers and acquisitions are greatly reduced) to recapture and retain competition, the essential ingredient of a free market. 4) We need real progressive tax schedules, inheritance caps, and new tax credits for the poor to begin the long task of reducing inequalities of wealth and income and for preventing perpetual family dynasties of the privileged from forming. 5) The Fed needs to work cooperatively with the Small Business Administration and with community banks and credit unions with the objective of directing a lot more money into loans to individuals for small business creations and for expansions of existing small businesses.

The major source for obstructing the work of those who would like to see changes in all these areas comes mainly from the very wealthy and those legislators responsible for passing the laws and for putting into place the obstacles that keep compounding inequalities, injustices, and inefficiencies, while trying to cover their intentions with false and misleading information. Their methods consist of denials, lies, and deceit wrapped into clever Madison Avenue propaganda. There are simultaneous struggles going with the issues of global climate changes, pollution, energy use, crime, and others. All these issues, left unchecked, will almost certainly lead to major disasters for America and for the world. Those who believe that silence and good intentions can prevent such disasters would do well to remember the wisdom in the old caution: The road to hell is paved with good intentions.