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Economics and the Public

Summary:
Every since having the scales removed from my eyes back at Grove City College by the economic sermons from Dr. Hans Sennholz, I have been persuaded that the public purpose of economics is precisely that -- removing the scales from the eyes of the public.  In economic affairs, this means eradicating ignorance of not only how market processes, but how political processes operate as well.  So I studied in earnest how to study the economic forces at work in a variety of institutional settings with the purpose of trying to explain clearly the costs and benefits of alternative public policies.  Of course, in talking about public policies we have to distinguish between policies chosen within any given political and economic system (say within the US democratic polity), and choices over

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Every since having the scales removed from my eyes back at Grove City College by the economic sermons from Dr. Hans Sennholz, I have been persuaded that the public purpose of economics is precisely that -- removing the scales from the eyes of the public.  In economic affairs, this means eradicating ignorance of not only how market processes, but how political processes operate as well.  So I studied in earnest how to study the economic forces at work in a variety of institutional settings with the purpose of trying to explain clearly the costs and benefits of alternative public policies.  Of course, in talking about public policies we have to distinguish between policies chosen within any given political and economic system (say within the US democratic polity), and choices over political and economic systems (say the socialist Soviet Union or the fascist Germany).  But rest assured, public ignorance abounds in both exercises.  As Hayek argued in The Road to Serfdom: "Is there a greater tragedy imaginable than that, in our endeavor to shape our future in accordance with high ideals, we should in fact unwittingly produce the very opposite of what we have been striving for?" (1944, 5)

When I first learned economics the reason primarily given for this predicament was that economic reasoning is hard, requires chains of reasoning that most are unwilling to follow, and the conclusions are often counter-intuitive.  But right there in Economics in One Lesson, Hazlitt also pointed out that policy thinking goes astray because of the power of vested interest groups who benefit from the policy at the expense of others.  So the basic logic of public choice was not alien to me when I first heard it for the first time, though to this day I believe ideology and ignorance are perhaps more critical issues than interests and rational ignorance.  I retain faith that if we economist do our job and explain clearly and concisely the logic of economic forces at work, and expose the public to the true costs and benefits, and who gains and whose expense, then a lot of bad public policies would cease to find popular support, and even more so, certain cherished ideological beliefs would be abandoned.  Reason and Evidence, not Passionate Emotions and Primitive Intuitions, can be the guide to policy, and result in peace and prosperity and general human flourishing.

Yup, I realize that is a certain type of romance as well.  I believe scholars are truth-seekers, so economists are tellers of the truth, and if done to the best of their ability and with communication skills as good as humanly possible, the economist as student of society, as social critic, and ultimately as teacher can do their job to eradicate ignorance, and in doing so set democratic societies (through public opinion) on the successful path to address the social ills of poverty and squalor as well (as opposed to the frustrating path we have followed).  The public purpose of economics is to be great "teachers" of the economics forces at work, and to be able to explain how alternative institutional arrangements either promote peaceful cooperation and productive specialization among individuals (the invisible hand) or frustrate the efforts to realize the gains from trade and stifle the efforts to realize the gains from innovation (dynamics of interventionism).

Things do get messy when we put the economists in the model, as Robert Tollison argued we must.  There we deviate from the truth seeker model, and view economists just like everyone else as interested parties who benefit from some policies at the expense of others.  In such a setting reason can be twisted, and evidence can be tortured, and the passionate emotions and primitive intuitions can be catered to even with the most seemingly rational and scientific of presentations.  The causality of this development is our understanding of the economic forces at work and the sort of policy regime that results in individual freedom, generalized prosperity, and peaceful social relations.  Rather than peaceful cooperation we get conflict, and rather than productive specialization we get sorting based on special privileges and connections to the powerful.

Yet, I don't believe that we in our democratic society, or those suffering in non-democratic societies, get the government that they want.  We get the government we get, and we get it for a variety of reasons, including physical force, but also public ignorance that does not equip the people with the "intellectual weapons" to mobilize public opinion against inefficient (and/or repressive) regimes.  But in these cases regime change is necessary, and economists can aid in that process if they do their job properly.  Economists are not saviors, they are students/critics/teachers, but if they do their job than their fellow citizens will have the capabilities to transform their societies.  Economists can equip their fellow citizens with knowledge, and that knowledge can be a powerful force for change, just as the lack of knowledge can be a powerful force used against citizens.  Ignorance is costly and its persistence means regimes can manipulate the masses and suppress opposition and exercise dominion over others for the benefit of a few.  Its our job as economists to counter this by empowering the public with knowledge of how the world works.  We are practitioners after all of the "worldly philosophy".

My blunt force treatment of these issues makes it difficult to be subtle, and I realize the subtlety in scientific and scholarly discourse is a must, and without it the conversation can degenerate into unproductive directions. So I have to constantly seek ways to check myself -- to have a sort of impartial spectator ready on hand (or in my case my inner Don Lavoie on my shoulder).  The world is complex, and there are many parts moving at once and in different directions in human societies so the real-world appears to us as a muddle and unearthing the governing dynamics requires analytically a surgical precision with fine instruments of reason and evidence, and not blunt force instruments.  That is the art as well as the science of economics and political economy.  But down deep I am today as persuaded by the role that economics properly done can have on the public imagination as I was when I read my first economic works and listened to Dr. Sennholz's words for the first time.  The scales really did get removed from my eyes, and I want to in turn share the 'good news' of economic science with other unsuspecting fellow citizens to eradicate public ignorance on economic affairs and in so doing set us on a more productive path to address other social ills such as poverty, squalor and idleness.

So when I read the following passage from Gordon Tullock -- one of the most hard-boiled public choice thinkers, socially irreverent, and in many ways the ultimate cynic of any "feel good" approaches to human affairs -- I cannot help but breath a sigh of relief because even Gordon Tullock thought this was our public purpose as economists.

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Let us get on with our task of being students of civilization, social critics of policy regimes, and teachers to our fellow citizens.  We need to empower the people with knowledge.  That is, I contend, the public purpose of economics.

Peter Boettke
Peter Joseph Boettke (January 3, 1960) is an American economist of the Austrian School. He is currently a University Professor of Economics and Philosophy at George Mason University; the BB&T Professor for the Study of Capitalism, Vice President for Research, and Director of the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at GMU.

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