Pros, cons and pseudos
ON THE first day, God created the Sun. In response, the Devil created sunburn. On the second day, God created sex. In response, the Devil created marriage. On the third day, God created an economist. This was a tough one for the Devil, but, in the end and after a lot of thought, he created a second economist.
Now two questions have emerged. The first is, which hand does the first or second economist favour? Or are they both ambidextrous? There is a plea to God supposedly made by almost every head of government but which originated with US President Harry Truman. It is said that Truman begged the Almighty for an economic adviser who was one-handed. Why? Because all the economists giving him advice were never direct and always beat around the bush with, “On one hand and on the other ... . ”
The second, and at this stage the more important question, emerged recently from Trinidad and Tobago (T&T) where Dr Terrence Farrell, the chairman of the Government’s Economic Development Advisory Board (which reports directly to the country’s prime minister) is reported as “blasting” non-economists for making pronouncements on the state of the economy in successive post-budget debates.
According to the Trinidad Express, Dr Farrell, “serving as the featured speaker at The University of the West Indies (UWI) Conference on the Economy (Cote) 2016 at the Learning Resource Centre, Farrell said those pseudo-economists were actually doing the country a ‘grave disservice’ to the nation” and that “professional economists need to reassert their value and their role in the national discourse on economic issues”.
So the second question emerging from the war between God and the Devil is, which of the two economists begat by the two ancient adversaries were professional or pseudo economists? That then leads to another question, What the heck is a pseudo-economist? and fuels further speculation about whether there are other economists who are neither professional nor pseudo.
In thinking about it, I realised that I needed to understand what ‘economics’ is before trying to understand what economists do to differentiate between the professional and the pseudo. Although it is said that economics is the painful elaboration of the obvious, there are some things about it that are not.
In fact, the one thing that immediately leaps out is that it is the only field in which two people can share a Nobel Prize for saying opposing things. Specifically, this was said about Gunnar Myrdal, a socialist politician who shared the prize in 1974 with the economist Friedrich Hayek, reputedly Margaret Thatcher’s inspiration. In addition to this odd pairing, the Financial Times also referred to another when Daniel Kahneman shared the 2002 prize with Vernon Smith. It was said that Smith won the prize for showing that economic theory works, while Kahneman won the prize for showing that it doesn’t.
THREE TYPES OF ECONOMISTS
This ambiguity is consistent with what are referred to as Bentley’s Second Law of Economics, which states, “The only thing more dangerous than an economist is an amateur economist” (or is that a “pseudo” economist) and Berta’s Fundamental Law of Economic Rents, which insists, “The only thing more dangerous than an amateur economist is a professional economist.”
It is said that economists have accurately predicted nine out of the last five recessions. Eddie George, a former governor of the Bank of England, quipped, “There are three types of economists in the world: those who can count and those who can’t.”
Another US president, Ronald Reagan, had his own view of economists, claiming, “Economists are people who see something work in practice and wonder if it would work in theory.” He also used to say that if Trivial Pursuit were designed by economists, it would have 100 questions and 3,000 answers. But perhaps the best answer to why God created an economist is to make the weather forecaster look good.
In T&T, a former prime minister, Basdeo Panday, was found guilty of defamation for calling former government minister and media magnate Ken Gordon a “pseudo-racist” and ordered by the court to pay more than US$1million. So far, none of those accused by Dr Farrell of being “pseudo economists” have taken any legal action in the matter, perhaps because their strong, and possibly inflated, selfopinions make them all believe that they do not fall into that category, particularly those with doctorates in the subject or others who are held in high esteem by different governments and the media. They pop up during the annual budget showpiece but recede into their recesses in all but recessionary times.
So, is there any option besides professional and pseudo economists? Well, you have ‘judo’ economists, who fight the status quo and their colleagues or competitors, which are one and the same. They even refer to them as ‘pseudo-economists’. There are ‘feudo’ economists, who carry on bitter debates and hold grudges forever. For example, there is a huge battle going on now between India’s big two economists, Jagdish Bhagwait and Amartya Sen, on how to lift millions out of poverty in India.
Then there are ‘Kudo’ economists, those who look for ‘kudos’ or praise and will do anything to earn them. The worst of all are ‘Freudo’ – they take the economy down a slippery slope and they rarely, if ever, give a true account of their motivation. Thank God and the Devil that all we in the region have are ‘Ludo’ economists, for whom everything depends on the roll of the dice.