Saturday, September 24, 2005

Full Nelson

The sheer plethora of ways economic idiocy manifests is astonding. Consider Willie Nelson's appearence on Real Time with Bill Maher.

According to Prof. Nelson, the key to any economy is their production of raw materials: food, oil, coal, and so on. To ensure the existence of these industries, government must fund them; the more taxpayer money they get, the better off we all are. Nelson goes so far as expressing anger that "only" 60%-70% of our farmers' income comes from taxpayer money.

It's a load of crap, but not an unfamiliar load. Nearly every yahoo who thinks they understand the economy points to one key industry that makes "the whole thing work." Some praise the holy tech sector. Some idolize Manufacturing. Some bow down to the Almighties of finance and savings. Willie worships the God-like power of raw materials.

To be sure, raw materials are important, but they are not everything. Gas is useless without the tankers to transport it. Food won't do a lot for someone who has cancer. Coal mines need phones to communicate with power plants. It's all connected; artifically bloating one sector puts strains on all the others without adding anything.

The key is that everything has costs. Unneeded farmers don't stare into the abyss; they do something else, filling in gaps that previously existed. Giving them a reason to do otherwise not only pulls them away from a valuable function, it puts resources (people, time, money) into something we don't need. And we don't need more food.


Illy said...

David, that's nothing! One of my PoliSci professors repeatedly stated, throughout the course, that the goal of the economy is to provide jobs for everyone. When I pointed out that providing jobs is the easiest thing (you could hire millions to dig up holes and fill them with dirt again, endlessly!) but that this won't exactly help the economy, he didn't seem pleased.
How are you doing? It's been a long time since I've talked to you! :)

David said...

I've been great! Doing a PhD in economics at George Mason and working part time at the campus. You?

I'm not surprised that your poli sci professor said that; most poli scis think companies should do the same thing as what government's supposed to do: protect people, promises and property from physical harm.

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