Improving Economics as a discipline, making it more evidence driven and predictive, is a good thing. But sadly there will likely always be people who distort and misrepresent its theories in order to fit their own agenda. We see that in pretty much every scientific field, even ones far harder than Economics.

Or worse in the UK where they all went to Oxford and got a PPE.

I like this question. I try to use it on myself. It gets to the core of some of our responses. I.e. we should opine with evidence when we can. But I would suggest one slight change.

> Are any academic or working economists who make these arguments in positions of power?

I'd say yes. E.g. economists working for The Heritage Foundation for example.

I believe working economists are more nuanced and critical than what filters through the medias and politicians. I've been trying to teach myself some economics. For instance, I read Mankiw's "Principles of Economics", a widely-used introductory college textbook and I find it balanced. The author tries to convey different points of view and warns the reader about the limitations of the field.

Actually, I've even found Milton Friedman in "Freedom and Capitalism" to be more critical of capitalism that I'd have expected (e.g. concerning monopolies and externalities, I read it a while ago though).

He's against government-enforced monopolies; market capture is fine by him (because surely an upstarted would disrupt the incumbent & wouldn't be subject to anti-competitive actions that kill their business).

Agree about the politicization of other fields of science too. Maybe it is more of a political problem in econ too.. thats hard :(

It's a bit like why people still publish in Elsevier in spite of them being awful - it's because it's how you get on in your career. Similarly differential equations about spherical cows get you promoted.

"Respectable" is questionable, but the economists that do are invariably motivated by ideology.

You have hit the nail on the head with regard to all Political "discussion" in the USA now.

It is all black or white. You are right or wrong, yes or no. There is actually no discussion, no learning.

There is no stopping to consider the other opinion or side. Or learning about it thoroughly so as to shed more light on the situation or circumstance.

It's a shame, because it means nothing is moving forward.

I don't know if the world has ever been different .. maybe not. I think people are just too lazy to consistently reason from first principles + data without taking shortcuts. So we always end up in a tribal shouting match with 0 learning - doesn't even matter what the issue is.

"Everybody worships. The only choice we get is what to worship." - DFW

The number of times I have heard a respected economist say this can likely be counted on zero hands.

In econ 101, you learn, "here's the free market model, it's wrong but it's useful", and much of the rest is learning about the scenarios when it's wrong.

But plenty of people who only take econ 101 (or no econ education) think like that anyways!

The question of what the perfect market structure is is not "settled" and beyond debate. I can see plenty of cases where the market, left to itself is not the best solution for society. Healthcare is one. Doesn't mean free market is evil either. It just means it might benefit from some regulation.

I'm against stupid reductive poles like "free market/no regulation/efficient market" VS "socialism/communism". That whole axis does not make sense. The whole idea of assuming you are either (pro EVERY effect of the free market) OR (pro socialism) is a false dichotomy. Thats what I mean by dogma. I don't know where it comes from but education might help dispel that kind of black and white thinking.

Is the unaffordability of healthcare an indictment of capitalism? No? Then why would it be an indictment of all regulation? "Regulation" is not one thing - there are many many choices.

Profit-seeking incentives don't always align with societal good. When health insurance companies are not required to cover everyone, they can and DO reject very sick people because their models forecast a loss. This happened for a long time before ACA with pre-existing conditions...

Thats what happens in a completely free market - insurance only serves the already healthy and leaves the sick (who need healthcare the most!) to die or pay exorbitant amounts.

That is a direct result of a system that incentivizes profit. Thats one area it would benefit from regulation. It already does in so many other western countries where government either directly provides healthcare or ensures that insurers cover everyone at affordable prices.

If we aren't willing to examine and interfere with the free market when the most basic need of society - health is being compromised, where does it end?? The market exists to serve society, not the other way around. This has been forgotten.

Bona fide insurance is a paid transfer of risk. With your auto insurance, you pay set premiums to Progressive, say, in return for them to replace your car if it is destroyed. With homeowner insurance, you pay monthly or annual premiums in return for Allstate to accept the risk of replacing your house should it burn down, be flooded, and so on. You pay premiums to MetLife, and in return, they pay out a cash lump sum or stream of payments should you die before a certain date.

All of these pay hard-core green-visor number crunchers called actuaries whose job it is to accurately price risk. Given a certain profile, how likely are you to be involved in an auto accident, suffer a house fire, or pass away? The profit motive is strong incentive for insurers to price risks accurately: too expensive and competitors can undercut them profitably, and too cheap will mean they lose money paying out more in claims than they collect in premiums.

It turns out that risk is not uniformly distributed. From their experience with USAA, the Goodwins determined that government employees are more risk-averse than the average American, and thus was born the Government Employees Insurance Company or GEICO. Before 1974, you had to be a civil servant to get a GEICO policy. In 1974, Geico began insuring the general public but still in some cases gives discounts to government employees. This is not done out of the goodness of their hearts.

Imagine you were CEO of InsureCo responsible for keeping the lights on and paychecks flowing to your employees. You cannot (for long anyway) pay out more than you are taking in. Your premiums have to remain competitive. Clever insurers also invest their “float” (money collected in premium not yet paid out in claims) to increase profit. However, if a potential customer comes to you requesting a policy quote but who represents greater risk in terms of expected claim payouts, a straightforward mathematics exercise means you must charge that customer more in premiums to offset the greater risk InsureCo would be accepting.

“Health” “insurance” turns this all completely on its head, but that is mainly because Americans have been conditioned to have bizarre expectations unlike any other form of bona fide insurance. Pricing risk accurately runs afoul of regulations, so “health” “insurance” becomes a transfer scheme under which younger, healthier customers are overcharged to make up for regulatory requirements to undercharge older, sicker customers. We do not expect homeowner insurance to pay for new light bulbs, cutting the grass, or other routine maintenance. Car insurance does not pay for oil changes, new tires, replacement radiators, and so on. Bona fide health insurance which used to be called major medical but is now derided as “junk insurance” worked similarly in that it has a deductible where expenses below it are the insured’s responsibility. This means less risk to the insurer and thus lower premiums. With all other insurance, we recognize that attempting to take out a homeowner policy after a house has already burned down is silly at best and fraudulent at worst. That’s because it is a preëxisting condition. With the negative event having already happened, it is no longer a risk but a reality and beyond the scope of insurance.

The complexity does not end here. In America, health insurance is connected to employment. Tracing backward through the economic cause-and-effect leads to the Stabilization Act of 1942[0], signed into law by FDR. This economically wrongheaded policy capped executive pay, and to attract and retain talent, companies routed around this brain damage by offering other fringe benefits including health insurance. Over time, more and more employees wanted in on the game. It seems fine until someone has both a gap in employment and a negative health event.

[0]: https://en.wikipedia.org/wiki/Stabilization_Act_of_1942

But why are the costs of health services so expensive to begin with?

For that, and pardon the driving tour, we have the American Medical Association to thank. Being a self-interested industry group, they wanted to develop ways to increase their fees — beyond what ordinary Americans wanted to or could afford to pay. By panning price competition among physicians as “unethical” and pushing for more employer-sponsored insurance plans, the result was setting up large pools of money to be mopped up.

Large insurers are necessarily much less price sensitive than families who are paying out of pocket. This pushes prices up. Perverse medical and health insurance regulations drafted by politicians whose primary concern is re-election and who pay no price for being wrong or inflicting massive damage on industry push prices up further.

Consider that when you pay comparatively small or zero price for a service, you are not the customer: the one who pays the bill is. TV, radio, Google, and daily newspapers are essentially free. You are not the customer: the advertisers are. When you go to the doctor and pay a $20 copay, you are not the customer: your insurer is. You have no money by comparison, but your insurer has lots. You are a vector to get to the real customer.

The sad reality is the system is working exactly as it is designed, but the object is not positive health outcomes. The health care industry gets their payola, and tax policy and other regulations protect the flow of premium payments to the big insurers. Coincidentally, all of these industries contribute generously to politicians’ campaign coffers, PACs, and so on.

Call “single payer” what it is: a welfare rationing scheme. It is far better to be a valued customer than a liability. The country’s crumbling infrastructure is in the condition it’s in because it is on the public books and viewed as a liability rather than an asset. Infrastructure spending is barely enough to keep it maintained, which also conveniently serves as a hotbutton issue for political campaigns. Government schools and other public services are chronically underfunded. “Single payer” public services will work out the same way. Canada makes no secret about their waiting-time “challenges,” which they attempt to sweep under the rug by saying waits are for elective procedures only, but they do not stop to define elective.

The deplorable state of “health” “insurance” in America is a symptom of the problem. The real issue is that health care is so obscenely expensive in the first place, and that is because we the patients have been displaced from customer status. The market already provides essential and life-critical services cost effectively. Look around you: food, water, computers, clothing, shelter, etc., etc. Amazingly, they do so even at a profit. Sure, government bureaus have attached themselves to these industries in various places, but do not allow emotion or ideology to cause you to confuse the direction of economic cause-and-effect.

The American health care market is so heavily regulated and tax-favored that it is a textbook failure of dirigisme, where failure is success. Liberate and liberalize one-sixth of the economy to fix the problems.

Counter examples only show that something does not work in all cases. It isn't a proof that something doesn't work in any case. Supply and demand is going to hold true in the vast majority of cases despite the existence of counter examples. In a similar vein, you can't say that an economic model is invalid in all cases because there are counter examples.

There are a ton of external factors that lead to the success or failure of a market. Culture, politics, resources, and industrialization play a huge role in shaping the market. These things are ever changing. Argue against the model, not its success or failure.

That's the whole point. Markets are decentralized brains, while Socialism advocates that a government as a central planner will be more efficient (it could be more efficient in specific cases like total war or natural disasters) and lead to Communism where we won't even need a government because society will behave as one being.

The lesson of the pencil comes to mind: https://www.youtube.com/watch?v=R5Gppi-O3a8

South America rejected Keneysian policies for what they believed were more "free market" policies. They suffered greatly, and they did not experience the massive postwar growth the Western world and the Asian Keynesian countries (Japan, Taiwan, S Korea) experienced. This was a great tragedy, because south america should have done great as they were the only corner of the world not affected by WW2. But they remained mired in poverty.

It is difficult to prove an economist right or wrong because it is difficult to run experiments in macro economics. But as much as it is possible to prove an economist right, Keynes has been proven right.

“It’s not the size of the debt but its structure,” the hucksters insist.

tl;dr Print more money.

Furthermore, you probably do not remember this, but the Clinton administration was paying back the debt and had America on a path to being debt free. But Bill Clinton, scumbag as he was, wasn't stupid. The wars he started were very short and very cheap.

The rest is very Keynesian and it shows. I'm from South America, trust me. Saying that you're a libertarian here is taken as if saying you're a fascist. Guess who they blame for our own failures? Capitalism and imperialism, of course.

One can criticize the current system without implying socialism/communism is the way to go!! I believe the current system has many flaws and they can be reformed. All systems have flaws, and instead of throwing our hands up and saying "welp this is the best system we can do!" we can choose to shape the market when it is good for society.

The market exists to serve society, not the other way around. It is only a tool.

Speak for yourself.

Then they didn't learn economics. Chapter 1 in Mankiw goes into why we learn using frictionless markets of rational actors. I think Chapter 2 or 3 went into market failure.

In the same vein, many people criticize economics for seemingly being obsessed with money. It is not, they just use it as a convenient proxy for value.

Not a more correct, or better, way.

The way it is currently taught has an agenda - it basically justifies whatever happens in business as a "consequence of economics".

Paid too little? Economics. Companies exploiting your privacy? Economics. Media turning internet into junk TV? ? Economics. Whats that you want some truth in journalism? No, consumers want entertainment. Economics.

At some point we have to stop putting "economics" first and put the way we actually WANT the world to be first. We can DESIGN the market to fit our vision of the world rather than fitting our vision of the world to fit the market.

For example. People are paid too little, because there's an oversupply of workers, because women are working. If women didn't work, men would be paid enough to support the families. But now that women are working, they can't quit, because the man alone won't bring in enough income. I don't think this benefits women, or men, or children, or families, and therefore not society as a whole either.

Of course we all know that not everyone agrees about what we want the world to be, and some understanding of economics is required to affect change responsibly, but this course is clearly left-leaning.

That's why I don't see it as an empowering "new way to learn economics" but rather as "push agenda more effectively". Personally, that's the opposite of what I want.

For example, the current syllabus is very careful to downplay genetic differences amongst people. It teaches that genetic differences don't matter and we are all essentially "blank-slates". The truth is somewhere in between. But it will take years before that is generally accepted. Direct result of atrocities in WW2. Thats an example of an agenda being implemented via education and shaping your thought.

You are repeating the same theories that justify any market problem -

Paid too less? Oversupply. Do you really know that to be the cause or do you assume so because that is the only mechanism the theory of economics provides to explain low wages? Perhaps it is the only possible cause when you assume all people are rational and have full information, market is efficient etc. But look at the real world! Those assumptions don't hold, so why expect this fantasy theory to be so accurate?

As long as a company continues to produce profit, of course they can afford to distribute some of that profit in the form of wages! Its profit - where do you think it goes? So why don't they? Why can't society make them? Don't tell me oversupply is the only possible cause of low wages when a cursory inspection of human nature and greed points to so many other possible causes. That is living inside a theory. Don't confuse the theory for reality.

I think that's because of oversupply, but will consider other explanations if they're forthcoming.