Economic Results, Economic Processes and Political Judgments of Economic Processes

'Perhaps the greatest achievement of market economies is in economizing on the amount of knowledge needed to produce a given economic result. That is also their greatest political vulnerability. The public can get the economic benefits of such systems by judging results without understanding processes. But in their political behavior, the public must judge processes - including economic processes of which they may be ignorant or misinformed. Public misunderstandings can lead not only to misinterpretations of economic benefit as harm, but to actual harm resulting from policies designed to “correct” perceived problems. Once the process is underway, every perceived problem - whatever its reality or origin - calls for political solution, and these “solutions” tend to create a never-ending supply of new problems to be “solved”.'
-Thomas Sowell, Knowledge and Decisions, p.69



http://www.amazon.com/Knowledge-Decisions-Thomas-Sowell/dp/0465037380/ref=sr_1_1?s=books&ie=UTF8&qid=1353411092&sr=1-1&keywords=knowledge+and+decisions+by+thomas+sowell

Manufacturing Jobs Peaked, On a World Wide Basis, Years Ago: Not a Singularly US Phenomena

Talking heads, pundits, and media types supporting current public policy [more accurately termed politico policy], are always in search of a statistical data point, holding forth statistics as fact, then making the leap that the data point constitutes complete evidence of an open and shut case…..have recently latched onto the data point of an increase in manufacturing jobs.

One must realize that the mantra of “manufacturing job” is a panacea. That is, implicit to the “manufacturing jobs” mantra of the politico and their intelligentsia following is that this particular job category, the rise and fall thereof, is the fix all. If manufacturing jobs are falling then this is the key to economic woes and the falling jobs number is due to some evil exogenous force. The rise in manufacturing jobs is a key to economic success and, of course, any rise thereof is directly due to politico policy.

Obviously the panacea and the political wrangling around this particular panacea is political dupery. However, the greater political nitwitery is that manufacturing jobs, the decline thereof, is a world wide phenomena and not singularly a US phenomena. Manufacturing jobs on a world wide basis peaked years ago yet overall output continues to increase. Technology and automation, as in the agricultural sector of the past, are supplanting the need for human workers. This technology and automation supplanting the need for human workers results in better more innovative product at a lower real cost.

Where the political dupery and political nitwitery merge is: if one is successful in attracting manufacturing jobs and builds upon the panacea, and if one looks forward considering that the current batch of dupes and nitwits being long gone twenty years hence, then one finds themselves in a 20 year future economy that has attracted an economic sector that’s worldwide employment opportunities have peaked years ago and which the unemployment is decreasing at an increasing rate while output increases at an increasing rate.

How does one frame the panacea at this 20 year future point? That is to say, how does one explain to the people alive 20 years hence that dupery and nitwitery purposely attracted an economic sector that was in decline in relation to human employment? How does one explain that nitwits attracted a sector akin to 1920’s and 30’s agriculture declining employment, and now its 1950 and agriculture is shedding jobs at a maximum rate while output skyrockets. And when manufacturing runs its course and becomes the agriculture of today, employing 3% of the employed work force yet producing mass abundance, how does one frame the panacea?

Public Policy or Politico Policy?

How does one define public policy and what in the world does the “public” have to do with “public policy”?

Public policy eludes to grass root, spontaneous order/emergent order policy that the public demands. Nay, nay. Public policy doesn’t exist. On the other hand, politico policy does in fact exist. The vast majority of “policy” appears, and is due to, the "vision" of a group of politicos and/or appears due to special interests through politico enablers. Stated alternatively, public policy eludes to the plans of the many whereas, in reality, politico policy is the plans of the few.

Political science, at the end of the day, is the altruistic notion that a well informed voter, a voter completely abreast of all issues, votes for the best political candidate that in turns makes public policy decisions in the public’s best interest. Politicos desperately want the public to believe this fairy tale. Does one perpetuate such nonsense -or- does one explain public choice theory which examines special interests, politico enablers of special interests, crony capitalism, and economic rent seeking of taxpayer dollars. That is to say, public choice theory examines how politicos through the mechanism of government build constituency through taxpayer dollars. -Or- as defined by James M. Buchanan of George Mason University: public choice theory is politics without the romance.

Does one really add insight using the phrase "public policy"? -Or- is insight gained with the use of the phrase “politico policy”?


Is it public policy that awards E. Gordon Gee, president of The Ohio State University, over $1,500,000 per year in compensation? -Or- is it politico policy that awards such compensation? Is it public policy to award Solyndra millions of dollars in the form of taxpayer financed subsidies or is it politico policy that awards such monies? Is it public policy that causes the existence of lobbyists or is it politico policy that causes the existence? Does a firm receive tax subsidies to locate in a particular state due to public policy or politico policy? (1)

Notes:

　

(1) College Presidents' Salaries, The Chronicle of Higher Education, 02/03/2010

http://chronicle.com/article/College-Presidents-Salaries/63874