Monday, August 3, 2015

"... controversy. I wish there could have been less ..."

The title quote is from the Preface to The General Theory.

Mine of 25 July, my critique of Noah's Why did rich-world deficits start exploding around 1980?, that's my idea of an important post. I'm not comfortable holding it up and waving it around like this; forgive me. But I'm looking at the assumptions which underlie an argument made by somebody with credentials; and I find that his assumptions are wrong.

As I said when I looked at it before: If you don't start with facts, even your best theories are bullshit.

Keynes said it better:

For if orthodox economics is at fault, the error is to be found not in the superstructure, which has been erected with great care for logical consistency, but in a lack of clearness and of generality in the premisses.

In the premisses.

I was re-reading mine of the 25th. Then, out with the dog, it struck me: I know what Keynes meant when he said I wish there could have been less controversy. Less of what looks like criticism of other people.

It's not criticism of people. It's criticism of ideas.

When ideas are based on facts that are not true, the ideas are probably wrong. As time goes by, wrong ideas become embedded in a "superstructure" of thought -- in our models of the economy. Then we base economic policy on those models. That's why the economy goes bad.

Keynes didn't want to generate controversy. He had to. It is essential to point out incorrect assumptions. Otherwise people (like Noah) build stories around them.

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