Friday.....America.....Intellectuals And Society (3)

Thomas Sowell begins his chapter on Intellectuals and Economics relaying this quote, Whether one is a conservative or radical, a protectionist or free trader, a cosmopolitan or a nationalist, a churchman or a heathen, it is useful to know the causes and consequences of economic phenomena. His message on this topic is that intellectuals generally, and remarkably, do not have an interest in, or put the time in to learn even the basic fundamentals of economics, but then proceed to make sweeping pronouncements on economic theory, particularly income distribution. He says that they've substituted vision for facts. Sowell gives a number of examples along the way. On statistics that seem to show that most people remain in the lower income groups, he points out that the Census Bureau can provide these type of statistics but the IRS figures can give a better people picture because it deals with the particular people involved and not just numbers. When one is not just seizing upon any numbers, the situation points to people moving in and out of many categories, with new people entering the equations, and a different conclusion resulting. He takes on the issue of living standards, claiming that if the intellectuals would use the intellectual method they take pride in, they would see that the determinations of stagnation so often brought up, are incorrect and proceeds to tell why. His description of the intellectuals' theory is that they base it on wealth " somehow just existing" therefore we must distribute it, rather than wealth being "produced." He tackles common accusations such as interest rates on loans being higher in poorer communities. His explanation is that, once again, the intellectual not educated in economics, fails to go further and see that these loans tend to be short, even called "payday loans", and if lower interest rates are to be applied, the profit may not even cover the cost of processing the loans. He answers critics of capitalism who claim that without planning and control, chaos results. He points out that patterns are the results, not chaos. and that only the verbal virtuosity of the intellectual turned economist can continually criticise that which they do not know and then demand to orchestrate their own plans and control. His description of "planning" is the forcible suppression of millions of people's plans by a government-imposed plan. John Dewey and many others are taken to task in this chapter that describes an attack on business of which V. I. Lenin said that "running a business involved extraordinary simple operations which any literate person can perform so that those in charge of such enterprises need not be paid more than any ordinary worker." Sound familiar? Sowell writes on a problem that has raised it's ugly head in many areas today, that being the meaning of words and changing that meaning to fit one's own purposes. Thus we have businesses that lower prices to stimulate sales that become issues of power and control. Admittedly, this postmodern concept of changing the meaning of words at will, has been a subject of a few of the blogs I've written here. So, what were the causes of the Great Depression? Sowell lays out the theories but returns to his criticism of intellectuals failing to do their homework. He concludes the chapter with with the example of various histories of the Great Depression that made FDR the hero for coming to the rescue by men such as Arthur M. Schlesinger Jr. who admitted that he was not much interested in economics.