The Fury of the Central Planners

When I was out in the provinces last month, I watched a bit of the BBC and SkyNews. One of the things I found humorous about the news coverage was the hyperventilating about Brexit. Every story had a Brexit angle, even the local interest stuff. The general impression I got from the news presenters was that they were having a tough time keeping it together. At any moment they could break down into sobbing over the horrors of Brexit. If you did not know better, you would think Brexit was code for re-opening Auschwitz.

All the prophesies about the disasters that would befall the world, if the snaggletoothed yokels voted to leave Europe, have not come to pass. In fact, the early returns suggest it has been a net positive for the Brits. Time will tell how it all unfolds as there is a lot that has yet to happen. Even so, the results thus far are making the Remain side look rather foolish. Instead of accepting this reality, the true believers are carrying on like Godzilla is about to cross the Channel and attack London, because of Brexit.

This inability to accept reality is not confined to the Brits. Tyler Cowen has an unintentionally hilarious column up demanding that we believe the libertarian economists and not our lying eyes. The short version, for those uninterested in reading it, is that he and the rest of the doomsayers forgot to carry the one and the day of reckoning is actually a little ways off. But don’t you worry though. The day of reckoning is approaching and those beastly Dirt People in the accompanying picture will be held to account.

In fairness to libertarians, modern economists are not libertarians. They dress up their act with libertarian hobbyhorse items like free weed and open borders, but modern economics is managerial central planning. They are technocrats convinced they can micromanage everything through monetary and tax policy. No matter how many times they get it wrong, they remain certain they just need to tweak their models and boundless bliss will spread over the countryside. Worse still, they fully embrace the lunacy of homo economicus.

Economics, as I’m fond of saying, is the modern equivalent of astrology. Before a battle, Cyrus II of Persia would bring in his astrologers to advice him on the time and place to attack his enemy. The astrologers would figure out what he wanted to hear, consult their maps and then tell him what he wanted to hear. Cyrus was a bad ass dude, who was rarely wrong, so it was a wise course by the astrologers to tell the boss what he already knew. When he won, they got some credit and they avoided contradicting the boss.

This old story about the eminent astrologer economist Joseph Stiglitz praising the economic polices of Venezuela ten years ago is a good example. Stiglitz was telling his hosts what they wanted to hear because they were paying him to endorse their brand of lunacy. Of course, Venezuela is now headed to total collapse because their economy has ground to a halt. In an age when Mexico’s poor people are obese, Venezuela has managed to have a food shortage. Maybe the rulers should not have listened to Joseph Stiglitz.

The fascinating thing about economists is that their error rate is outlandishly high, but they never lose credibility with the rulers. Obama called in his best seers when he rose to power in 2008. They told him that borrowing a trillion dollars and blowing it on pointless projects would result in 1.5 trillion in economic activity. They called it the fiscal multiplier. One could be forgiven for thinking that this is another version of this old joke about a stranger coming into town and spending $100 at an hotel, then changing his mind.

The Obama stimulus plan was a bust, but that was never really the point anyway. Obama wanted to lavish his party with your money and he wanted to make it look like he was doing you a favor by doing it. That’s why he called in his best magicians and astrologers to give it their stamp of approval. Being right or wrong was never a concern. It never is in economics. The chief architects of the stimulus knew it was a great career move to give their stamp of approval to what was obviously just good old fashioned patronage. All of them landed prestigious jobs in the academy and Wall Street afterward.

Anyway, I suspect the fury of the central planners over Brexit has to do with fear that the scam is no longer working. Every big foot economist from the West weighed in against Brexit. They shook their staffs and promised Britain would be visited by plagues, monsters and dark spirits if they left Europe. The voters chose Brexit anyway. If you’re in the business of fooling the people on behalf of the rulers, you need to show you can fool the voters. Otherwise, the rulers have no use for you.

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61 Comments on "The Fury of the Central Planners"

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Chiron
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The EU is the biggest project of the central planners, is about putting all the European provinces of the American Empire together under a single administration, I fully expect that the central planners want to merge NATO with the EU and they might even try.

JohnTyler
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The EU central planners wish to create a USSR minus the mass exterminations and militarism Like all elitists they believe the USSR, Venezuela, Cuba, all of USSR dominated Eastern Europe, etc., failed economically because they were not personally there to apply their intellectual acumen and genius to guide the ship. All that was missing was themselves. Such is the arrogance and hubris of the elites. Of course the prime motivating factor that drives the elites is their contempt for the decisions that average folks make and in a capitalist system (like used to exist in the USA until about 1925),… Read more »
Karl Hungus
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Thank you for the short version.

notsothoreau
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Just an FYI for you. Take a look at your site stats:

http://www.alexa.com/siteinfo/thezman.com

Nice bounce there!

Solomon Honeypickle IV
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Solomon Honeypickle IV

Scenario: Hillary croaks, and Michelle takes her place on the ticket?

thor47
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One cold, unlikeable, condescending candidate replaces the former cold, condescending, thoroughly unlikeable candidate?

Member

Libertarian economics work in a libertarian world. If only we lived in a libertarian world. But we don’t. So tell them to shut the fuck up.

Drake
Guest

I have not heard an economist who was anywhere in the neighborhood of Libertarian since Milton Friedman passed. I did have a Macro Econ professor in grad school who probably fit the bill – I still remember his motto: “The economic drag of government on the economy is the NPV of expenditures minus transfer payments.”

None of the big-government EU-loving economists would say something so crass. They are leftists, not libertarians or classical liberals.

Member
I shouldn’t be so hard on them. The ideas are sound and can have application in the real world in prudent hands. The hard core followers, however, misapply them constantly and end up making the ideas look like the idiots pushing them. Just read a book about the influence of Puritan ideas in English law. Turns out Coke was a bit of a trust buster in his abhorrence of monopolies and even was opposed to corporations in general, but he got together with other judges and officials and hammered out specific rules regarding when the concepts could be used appropriately… Read more »
Dutch
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I am not sure the economists believe that they can micromanage the economy. Per the later part of the essay, they are telling their paying audience what they think the audience wants to hear, and then they hope that the results in the real world just happen to coincide with their proposals (so they can claim success). It is all a Capital City scam, one end to the other.

JohnTyler
Guest
Yes, they do. Economists certainly believe they can micromanage an economy. And why shouldn’t they? They have reams of theoretical studies and “proofs” (all highly mathematical, therefore they must be correct) that they have it all figured out. Of course, NONE of their theories or proofs have been or can be subjected to controlled experiments and thus can never be proven wrong ( or right). But just toss enough econo lingo and math , and poof, it is all very clear. Add in the fact that most of them are liberal progressive elitists – hoping until the last that the… Read more »
LetsPlay
Member
It fails to astound me. Kind of like knowing that fire can burn. Certain ideas have been proven throughout history to fail. The old saying about Socialists and their past failures … “Well, ‘we’ will make it work this time! It just wasn’t done right in the past.” Same same. Like gravity. What goes up must come down. It just is. But some people (why so many?) seem incapable of accepting reality? It really is as Michael Savage coined “a mental illness.” We need to bring back Insane Asylums and when these ideas pop up, put those spouting them away.… Read more »
Guest
Guest

Just a quick note:You forgot the parens

(((Joseph Stiglitz))) of (((Columbia University))) from whence the (((Frankfurt School))) made its foray into what used to be America. In a shocking Cohencidence, Obama graduated from Columbia.

Wide Awake in America

A.T. Tapman
Member

I’m woke!!!!!

Doug
Guest
Well sure, the elites are hideously rich spoiled brats. They have rigged the activity of the rest of the human race to essentially be their personal cash cows and foot servants to strip mine of their intrinsic wealth at their leisure and whim. They can not imagine us dirt people refusing to comply never mind defying their economic and social omnipotence. What I think really insults them is the deplorable’s are beginning to revolt against de-culturing. We are talking about people who create nothing but trouble, they rob everyone of everything and think they are unique, special somehow, like demi-gods.… Read more »
UKer
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The BBC is, essentially, a London-based organisation (as is Skynews, for that matter) so all they think about is London stuff. That means to them that cheap vacations to France = very good, muslim mayor = good, diversity leading to restaurant choice = good, saving Syrian people = good, and with it not mentioning that the refugees go back to Syria for vacations = good, Brexit =very, very bad, rest of UK = very bad and not worth bothering with. Trouble is we still haven’t Brexited. We are still paying money to the fat buggers in Brussels and still subject… Read more »
Karl Horst (Germany)
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@ UKer – I have come to understand you Brits are London-centric in the same way the French are Paris-centric. If anything happens outside of those two major cities, nothing really happened at all.

Lorenzo
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Karl, my impression of Germany is that the German news is much more decentralized (i.e. not all about the doings in the capital) than in the US, UK or France. How does it seem to you?

Karl Horst (Germany)
Guest

@ Lorenzo – Yes, that’s an accurate observation. Germany is not Berlin-centric in the way France and the UK tend to be. If something happens in Germany, everyone knows and Berlin does not dominate the media or policy. Which is why for example the Bavarian government had such attention during the immigration issues. But don’t think for a minute the German media isn’t controlled. The idea of a “free-press” has been dead for decades.

Lorenzo
Guest

Thank you, Karl.

UKer
Guest
Karl: you are 100 per cent correct in this. The biggest smile we provincials have is the issue of snow. If it snows and settles in London (which is usually a couple of degrees warmer than the rest of the UK) the BBC always leads its ‘news’ bulletins with film of the incredible disruption to London commuters. It’s like, wow, look at us being brave and battling through the soon-to-slushy white stuff. Meanwhile parts of the UK, Scotland in particular, is in fits of laughter as most of the land has been under snow, real deep snow at that, for… Read more »
Karl Horst (Germany)
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@ UKer – I remember a few years back seeing a satellite picture of England around Christmas time. The entire island was white. But all we heard about was the disruption of the air traffic in London despite the fact the rest of the country was also at a stand-still and people were actually freezing to death up north.

CaptDMO
Guest

“If you’re in the business of fooling the people on behalf of the rulers, you need to show you can fool the voters.”
Let’s see, (ie)Mr. Krugman has been the political Science scribe for NYT, under the heading “Award Winning Economist”, for HOW long?
Must be nice when you only have to reinforce the consistent dupeology (I made that word up) of
those desperate enough to think he really knows.
SEE: Fiddler on the Roof.

Severian
Guest
Ignoring history is the flux capacitor of liberalism – it’s what makes faith in socialism possible. Funny how you can trace every “intellectual” movement since the late 19th century back to that basic dynamic — they’re all the rationalization du jour for socialism. Libertarian economics? “We like weed and cheap gardeners, therefore socialism.” Postmodernism? “The facts say socialism doesn’t work; we say there is no such thing as a fact; therefore socialism!” Psychoanalysis? “People are getting crazier; must be capitalism. Therefore, socialism!” Etc. etc. Sssshhhhh….don’t tell them, but it’s exactly the same thing as those awful Evangelicals trying to pray… Read more »
Member
The Bolsheviks were a bunch of economists and look where that all ended up. Speaking of Bolsheviks and economists, my favorite economist is using language straight from the Moscow show trials: Why Are The Media Objectively Pro-Trump? For those not familiar with the reference, during Stalin’s show trials, some cat like Pyatikov or Radek would get up and confess, “Sure I was subjectively fulfilling the five year plan by ordering pig iron production doubled, but objectively I was sabotaging the plan since the coal was actually needed for power production instead of coke. Thus the danger of letting economists anywhere… Read more »
Severian
Guest

I keep waiting for Hillary to start drunkenly ranting about “wreckers,” “capitalist-roaders,” and “right deviationists.” Her wardrobe is already Mao-esque. The Media, meanwhile, are going full Stakhanovite. (In case you can’t tell, I love commie lingo and think it needs to be revived — as **insults**, I hasten to add).

Member
There are some poorly sourced reports going around having her wandering the halls late at night moaning that “the fascists will hang me if I don’t get elected,” so we may not be far off, Severian. The language of High Stalinism is fascinating in a weird way. In the 20’s when Josef is buddying up to Kamenev and Zinoviev its still the very trite Comintern lingo (Sovnarkom is still my favorite). After WW2 when Dzhugashvili is tired and gray, the commissariats become ministries and wreckers and deviationists become cosmopolitans and toadies before the West. But in the ’30s, that was… Read more »
james wilson
Guest

That poorly sourced report got credence with me when it reported that staffers are relieved of their guns, er, cell phones, before entering the cage with Hillary.

A.T. Tapman
Member

I love commie-speak, I always have. Just reading the wonderful examples of commie-speak as presented by our comrades Severian and el_baboso has made me shiggle, and I don’t shiggle easily.

SgtBob
Guest

“Obama wanted to lavish his party …” Quite descriptive and to the point.

A.T. Tapman
Member

No one ever accuses O’bambi of being niggardly.

John the River
Member

Quick question, name all the famous economists that were also an success at creating, running and growing a business.

Any business.

Karl Horst (Germany)
Guest
I for one was very happy to see Brexit come to pass and I cheered on my British cousins and celebrated with their victory. But before you all decry the “horrors and abuse” of the EU – of which there is plenty – you have to fully understand some of the benefits and why it remains important to Europe. For example, while the British argument claimed they paid 2-Euros and received 1-Euro back in benefits, but they failed to mention that Irish kids can now afford a college education thanks to EU tax contributions. That Italian historical sites like Pompeii… Read more »
notsothoreau
Guest

Maybe the Irish kids could have afforded college if Apple paid their fair share of taxes there 😉

Karl Horst (Germany)
Guest

@ notsothoreau – What? And put an end to a capitalist trend of skimming off from the people? No no no. We’re much more advanced than that! Besides, we’ve been doing it over here in our respective little kingdoms since the dark ages. Nothing to see here – move along. 🙂

james wilson
Guest

Business taxes are a great illusion-delusion.

UKer
Guest
You are right, Karl, that so much of Europe has benefitted from spreading the money around. The issue is whether those countries who benefit should sort out their own taxation and thus not have to rely on taking it from others. While I am glad French roads are heaven for drivers, I would have thought the benefits to the French people of making their own roads better for traffic would be more of their own priority. Having the EU gather many taxes (and fines and licence fees and what have you) is an expensive undertaking, and then the expense is… Read more »
Karl Horst (Germany)
Guest
@ UKer – The problem for the EU is our southern neighbors simply can’t fund their countries selling pasta, olive oil and bottle corks in today’s economy. Unfortunately they have neither the capability nor the resources which is why Germany, and to some degree France, remain the dominant financial drivers on this side of the Channel. In my eyes, the purpose of the EU should be to operate in some ways as the US Federal government operates in the US; where the individual states are responsible for local support (country roads, schools, etc) while the Federal government is responsible for… Read more »
wordly wiseman
Guest

Well, the german arms industry benefited from greek contracts. So the total is not all negative. Greetings from your southern neighbour !

Karl Horst (Germany)
Guest

@ wordly wiseman – Ah ha! Excellent! I do look forward to reading your perspective on all these wonderful topics theZman puts out for us. I believe there is at least one other German, a Brit, now we have a Greek. Europe is becoming well represented. Welcome. 🙂

wordly wiseman
Guest

@Karl Horst Actually, I am a croatian (sorry for the confusion) . I have been a regular reader for more than two years. I am extremely grateful for your perspective on the current state of german affairs, a topic i am not well informed as i should be .

Karl Horst (Germany)
Guest

@ wordly wiseman – Ah, okay – from Croatia. I was in Pula last year for a long weekend. I must get down to Split as I hear it’s very nice.

Karl Horst (Germany)
Guest

@ theZman – Are you back from your trip? Did you manage to spend any time on our busy little continent or were only the European island dwellers blessed with your presence? 🙂

Member

Like Ptolemy’s crystal spheres, economics gets complex when it is used to support falsehoods and fraud. BTW, because of the dirty agreement between the Republicans and Democrats to not have a budget since 2008 the Obama $900 billion stimulus has been in the spending bills for EVERY year since.

Member

Of all tyrannies, a tyranny sincerely exercised for the good of its victim may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated, but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. C.S. Lewis

Member

The Conservative Treehouse makes an interesting point that nobody else has caught on to. We did not have just one stimulus. Once the stimulus occurred, it was incorporated into the baseline budget and we have spent the same amount in each following year. In effect, we have had eight stimuluses. Think about that. We would have a 13 trillion dollar debt right now if they hadn’t done that to us.

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