Wednesday, November 23, 2016

Economists Abandon Their Posts

The Texas district court that struck down Obama's illegal extension of overtime pay to a new class of workers reminds us that economists have said nothing about this job killing Obama edict. Anytime you arbitrarily make it illegal for workers and businesses to freely contract, you lower worker income and lower worker employment.  There is no economic analysis that says otherwise.  Microeconomics is completely clear on this point.  So, why don't economists have something to say.

The answer: economists have become political hacks. They are slaves to their left-wing political ideology.  Part of this slavishness is 'of necessity.' After all, right wingers do not fare well in the modern academic echo chamber and the world of academic research grants.   To get grant money, you have to subscribe to the Elizabeth Warren view of the world.  Not much economics in that view.

Look at all the studies that economists have produced that say that increasing a price by government fiat leads to increasing demand.  You ask:  what studies?  Much of the research on the effect of the minimum wage suggests that if we could just raise the federal minimum wage to $ 100/hr, our problems would be over.  We would have licked inequality and poverty -- in a sense.  Most every job would be gone, so all would be equally poor.  So much for inequality.  Everyone would now be at starvation levels (think of today's Venezeula) and since poverty is always defined on a relative income/wealth basis, the absence of inequality in world of a starving populus impolies the elimination of poverty.

Pretty stupid isn't it.  But, that is exactly the way most of today's academic economists see the world.

No comments: