THE DISMAL SCIENCE/ AYN RAND

BUSINESS WEEK (2009) 4/27/09

COY/26-31

What good is economics? They are the folks with lots of math who are supposed to predict the market and  lots of other things that contain bells and whistles. Unfortunately, not one prominent economist predicted the crash of early October, 2008.

They have very diverse views about how to recover. They call themselves a science. They have econometric models that don’t work very well. Economics is not neutral. It is shot through with politics.

They apply hard, ratio, numbers to soft human activity. They are trying their best to kill BEHAVORIAL ECONOMIJCS because it is not pure.

All the other soft sciences or social sciences know their limitations. Sociology, psychology, and political science are reaching out to the physical sciences for brain activity and related human bio-stats. However, economics plows on.

You take INTRODUCTION TO ECONOMICS, what do you get? You hear that humans are rational. Well no they are not. They appear to be non-rational. You discuss models that assume perfect competition. Now does that happen in the real world? No. Perfect competion means that there are 100 companies say in oil. So do all do about 1% of the work and the profit? No. There are about 4 or 5 that have most of the business. The rest are loose change.

Economics has to change to stay alive. All those years spent on math modeling is a loss. Further, it ruins some real talent and puts them out of the field. It becomes dry as dust. Paul Sameulson gave us math. Milton Friedman told us we don’t need to regulate and monitor. Robert Lucas indicated that government can’t stimulate the economy. Paul Krugman wants to go back to the New Deal. He seems to be okay, but the others have helped us fall of the cliff.  Friedman was the front man for the most aggressive form of capitalism. Not all capitalisms are the same.

THE BIOFUEL BUBBLE

CAREY/39-42

There will be all kinds of new innovations in fuel including bio-fuels, however, Big Oil will probably win. If we need something other than oil because we run out, then that is for the those in the future to take care of. . It is not their problem.

Big oil can mix some bio-fuels together. However, the costs of discovery, production and distribution are clearly on the side of oil.

THE WEEK (2009) 4/24

11

CAPITALISM’S ENDURING CRUSADER

AYN RAND’s book sells second only to the Bible. Here is the message.

1. You and I owe nothing to each other. It is only through hard Social Darwinian struggle that some of us reach the top or even survive.
2. God, Jesus, Buddha and all the rest of those types are clearly not productive Their message about helping or sacrificing for a relative, a friend, a stranger is not correct. You are what you can produce and or outwit  from another. Capitalism is the root of all good.
3. . You owe nothing to anyone else. Nor, do they owe anything to you. Other than economic arrangements. Friendship can be a fool’s errand.
4. The individual is supreme even if it means that others will suffer.
5. The main task while here on earth is to make oneself happy through hard work and competition no matter what you have to do. You must stay within the law, but their should be very few laws.
6. The smaller the government, the better.
7. One must measure one’s self by achievement and acquisition.
8. While others cry, be brave and distant.
9. You owe only that which is to your own gain.

Our last Federal Reserve board chairman Alan Greenspan was a follower of the above and then before the cameras and a government committee said that there is a flaw in this

laissez-faire form of government.The flaw is that Mr. Greenspan assumed that all parties or most participants in the market would stay within the law for their own selfish interest.