I have had a link to an article about the Smoot-Hawley Tariff Act open in a tab for weeks now, planning on saying something clever about it, but you know, the more I dig, the more I realize there's no cleverness to be had. We're now a long lifetime after the thing -- nearly three 30-year generations -- and economists are still arguing over the role, if any, that it played in causing (through the run-up debate), prolonging, or steering the Great Depression and while they've all put forward pet theories, grand notions and entire books of scholaresque bloviation, the takeaway is, "We dunno."
That's a definitive indictment of central planning: If you don't know what the knobs do or how to read the meters, even in hindsight, stop trying to run it!
Economics ought to be an observational art, not a predictive one: descriptive, not prescriptive.
And thus endeth today's lesson.
When's that get fun? There's no money or power over the lives of the hoi polloi (even indirectly) in descriptive.
ReplyDeleteActually, you got it right when you said it should be an art. It's certainly not a science.
ReplyDeleteSimilarly, "political science" is an oxymoron, but colleges of liberal arts still teach it. I guess it's job security for balding hippies. (Same for sociology, but if I keep going, I won't stop.)
I think WWII really got us going down the wrong track.
ReplyDeletePonder "Pilot Induced Oscillations"- a phenomenon where the pilot of an aircraft over-corrects in his control movements and makes the problem worse. The economy works in a similar way.
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