“Ben Bernanke has said that he could not save Lehman because it would be have been in violation of the law. My response is that it is not his responsibility to enforce the law. It is his responsibility to safe guard the lives of millions of people. … When the Capitol Police haul him away in chains then his responsibility to prevent the Great Recession ends. Until that moment the choice not to act, is his choice alone. … The constitution is no shield.” – Karl Smith, Modled Behavior
Thus begins all violent ends.
Government consists of institutions. People have the institutions that they choose to. People deserve the consequences of those institutions. They learn from those consequences. People choose or choose not to alter institutions to prevent repeats of the past. People deserve the consequences of choosing or not choosing to alter those institutions. Political externalities are so vast, economic consequences are a trifle by comparison.
Politics is the exercise of power. Power is the ability to alter the probability of outcomes. It is the ability to transfer, or deny the transfer, of opportunities and rewards between groups.
Let’s see what this economist has done: 1- The scientistic fallacy. 2 -The fallacy of goodwill. 3- The false consensus bias. 4-Fallacy of collective terms. 5-The denial of externalities. 6- The fallacy of the short run.
So he errs. And in that error would open the door to far greater horrors than the one we suffer now.
The west is unique: it is the only social order that employs the competition between organizations with competing interests who must enact rules which are used by ordinary people who run institutions to conduct the affairs of the polis. It is a ‘game’ form of government for a ‘game’ marketplace. It is the only instance of that model to survive. and as a consequence it breaks the consanguineous bonds that determine the fate of all other civilizations.
So, Fix the laws. The rule of law is all we have. Without it, we cannot have a high trust society, and would quickly devolve into either india or south america.
Politics is more complex than economics. Political externalities have greater consequences than economic externalities.
And Scientistic hubris is legion.