Economics: A Weapon of mass Distortion.
“There are three kinds of lies: lies, damned lies and statistics.” - Mark Twain.
I thought it would be rather fitting to open with that particular Mark Twain quote. He was on to something when he quantified three different types of lies and while I do think stats have been twisted and mangled and distorted more than words themselves, we need to go a step further.
Mr. Twain misses the point here, if ever so slightly. Guns don’t kill people, people kill people. And with that logic in mind, lies don’t lie to people, people lie to people. it just so happens that statistics happen to create the most trustworthy lies since they are soaking in both tangible and reputable facts. This is the underlying problem with economics, stats can be twisted to show nearly whatever the presenter wants them to show. It might be the one barrier that keeps economics fluctuating between theory and science.
Not picking a side on whether or not our wages have stagnated or if we are actually making more or less and if our fringe benefits help offset the inflation adjusted stagnation and blah blah blah.
There are so many angles on economics, as Don Boudreaux mentions. Economics is as much theory as it is proven science. Statistics, which most of this economics leans on, can be altered in which ever way one would like to point their audience. The same exact data can be twisted to prove both sides correct, so I warn you to take all of these stats and economic “lessons” with a grain of salt. Especially in an election year in an obviously slumping economy, there will be lots of numbers, lots of facts and stats and lots of economists standing behind their ivy league PhDs barking out completely different ideals and theories of where this country is headed and how exactly we should arrive there.
I will say this much, and it’s the one place I totally disagree with Reich (a man that I have respect for) is that taxation and heavily taxing the successful is not the path to prosperity and it’s not the answer to solving our poverty problem. As Winston Churchill once said, “We contend that for a nation to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
There’s no reason for us to try and take from our own rich and give to our own poor. That’s not a solution, that’s a variable. That’s like solving your famine problem by taking food from those that have food and giving it to those that don’t. Eventually, everyone will become malnourished.
We shouldn’t try to give everyone an “equal” slice of a pie, especially when they have not earned it. We should try to grow the size of that pie all while teaching those with smaller slices on how to obtain a larger percentage.
We always hear politicians and liberal economists mention that we need to tax the rich and give to the poor. I believe that’s the wrong mentality. A loser’s mentality, if you will. It’s the very same mentality that the current administration has ushered into office and has infected a large portion of the country with.
Why do we not teach our poor how to stop being poor instead of teaching them how to maintain being poor? I for one believe that even in the worst cases, those people are still willing to work and earn their way, or at least they should be.
The mentality that plagues how we approach our poverty issue is the same irresponsible and illogical mentality that plagues much of our healthcare system. No one tries to cure anything anymore, they simply try to keep you alive, constantly one the same drugs and forever indebted to BigPharma.
Let’s stop teaching people how to maintain and let’s start teaching them how to get better. It’s what’s best.
The Real “Truth About the Economy”: Have Wages Stagnated?
Don Boudreaux of CafeHayek responds to Robert Reich’s claim that wages have stagnates over the last 30 years. Reich ignores the growing amount of benefits people receive from jobs, uses selective measurements when calculating inflation, and ignores income mobility to arrive at his conclusion.