My native language is one of the Scandinavian ones; however I’m not an ethnic Scandinavian.
I have difficulty discussing topics that have different meanings of words than from ordinary logic and reason. If you need to follow a certain dogma or orthodoxy then discussion becomes meaningless for those outside. To me it’s like debating about whether the earth is flat or not. Debating how many angels can fit on the head of a pin. I was educated and trained in law and economics so for me logic and reason was core required skill sets. I understand the need to clarify the meaning of words but in no logical interpretation can restriction=prohibition unless it’s dogma.
Further everything is a continuum; nothing is static, not even Austrian Economics. For it to be static there has to be truths that are unchangeable and eternal. There are none! (Unless you believe in metaphysical concepts such as God and/or absolute morals! The existence of God and absolute morals cannot be proven or disproven. That discussion on metaphysics should therefore take place at a theological seminary/ philosophy class, not in a discussion on Economics.)
In Macro Economics there is no eternal truths only temporary knowledge. Macro Economy and Austrian Economics is not science it’s only a way to describe the world. I dislike Keynesianism, Marxism and the later Chicago School that tried to find a grand all encompassing theory. It is doomed to fail. Human interaction is to complex and that is why came to Austrian Economics. It seemed to me to hold the most rational and logical explanations as well as it seemed to be based on the science of human behavior, Behaviorism. It also dealt more on the Micro level and all but dismissed Macro.
Kenneth Rogoff and Greg Mankiw are two leading US economists that are neo-Keynesians that synthesize Austrian and Chicago School with Keynesian theory if I understand it correctly. Below read about Rogoffs new book as well as a new book about the problems with the Chicago School.
Anarchy and a total free market have existed? Where and when? Nozick didn’t argue for Anarchy he dissected different forms of societies. It was in fact from his discussions that I came to the conclusion that anarchy and the absolute free market were pure theoretical and philosophical constructs.
I agree that from a theoretical standpoint there will be no shortage of work if people are willing to accept any wages but it’s like Peak Oil, oil will never run out because the last barrel will cost trillions of dollars. My arguments in the discussion are from the fact that the welfare state is here to stay and is huge. I also argue from the point that there already is massive state intervention in immigration, from a point of Status Quo i.e. a Keynesian situation. Austrian Economics have very little to say about that other than from a theoretical perspective. We disagree on the need for restriction on unskilled immigration.
I argue in reality, what is, and you argue from an Ivory Tower position of theoretical and philosophy perspective i.e. what ought to be. Let’s agree to disagree and end this discussion.
- New book “This Time it is Different: Eight Centuries of Financial Folly” By Carmen M. Reinhart and Kenneth S. Rogoff reviewed in The American Interest November/December issue 2009 by Harold James in the article ”Recession Regression”.
”One of the fallouts of the global financial crisis, especially after the collapse of Lehman Brothers in September 2008, has been the questioning of the credibility of much of what passes for economic science, whether delivered by the mathematical adepts of sophisticated financial modeling in the business world or by academia.
This kind of economics promised a rational world of ever-increasing prosperity and stability. It was rather dismissive of economic history, which was cast off as an obsolete discipline based on old-fashioned, low-technology techniques. The only value economists saw in history was as a mine for microeconomic data that could be fed into complex mathematical models. By contrast, economic history (which is often rather gloomy) now looks rather more interesting and important. Carmen Reinhart and Kenneth Rogoff have delivered a powerful and eloquent statement explaining why. ”
In the same issue M. Davidson author writes about his coming book ”Reality be Damned: The Legacy of Cicago School of Economics” about the danger of Great Ideas in Macro Economy such as Marxism, Keynsianism and later day Chicago School. The book is to be printed in 2010 and its name is ”Chicago Economics and the Origin of the Financial Crisis”
The Chicago School’s basic assumptions about human nature and the intersection of economic and political life were not doctrinaire at the start, and they may have been in that day a useful warning against then-fashionable tendencies toward planned economies, the hubris of social engineering and assumptions of ultimate convergence between socialist and capitalist economies. But ironically, as economics asserted itself as an independent science, divorced from its partner, political philosophy, it became more politically entangled than ever. Modern politicians searched for the expertise necessary to manage a changing modern economy in the Chicago School and found an empty closet. Once it abandoned its political concerns with economic power, Chicago theory, with its axioms of profit maximization, perfect information and self-correcting markets, had no advice to limit the downside risks of economic and financial disaster. The fruitful blending of social and economic concerns pioneered by Simons may not be suitable to a modern economy, but his concern about the dangers of centralizing economic power remains an issue that is ignored by the Chicago School. Doctrine supplanted healthy intellectual doubt, theoretical purity trumped common sense and historical memory, acolytes took over from masters, and a different kind of irrational exuberance was the result. We’re all now paying the price.