March 25, 2017

Economics and truth

Comment on Simon Wren-Lewis on ‘Post-truth and propaganda’


Based on many pertinent examples, Simon Wren-Lewis criticizes the media for obscuring and trespassing the demarcation line between truth and propaganda. Being a scientist, Wren-Lewis knows that this is a problem that plagued already the ancient Greeks and they solved it ― in principle ― by distinguishing between opinion (= doxa) and knowledge (= episteme) and by specifying truth as material and formal consistency. They were well aware that it is a tough task to draw the demarcation line between opinion and knowledge.

“There are always many different opinions and conventions concerning any one problem or subject-matter .... This shows that they are not all true. For if they conflict, then at best only one of them can be true. Thus it appears that Parmenides ... was the first to distinguish clearly between truth or reality on the one hand, and convention or conventional opinion (hearsay, plausible myth) on the other.” (Popper)

Now, everybody is well aware that the media are in the opinion business. To accuse them of propaganda is therefore a bit misleading. Media tell stories and 99 percent of a population pays to get a good story/plausible myth. Scientific truth is simply not a big issue in social communication.

Knowledge takes the form of a materially/formally consistent theory which is the best mental representation of reality that is humanly possible. All scientists know that truth is the pursuit of a minority and certainly NOT of the mass media and their audience. So, it is at first glance rather odd that the economist Wren-Lewis elaborates so intensively on this well-known sociological fact.

At second glance, though, it makes perfect sense. The very characteristic of economics is that there is no clear-cut separation between politics and science. The founding fathers called themselves political economists, that is, they left no doubt that their main business was agenda pushing. Economists never got out of political economics. In other words, theoretical economics (= science) ultimately could not emancipate itself from political economics (= agenda pushing).

Economics started as political propaganda and after the failed attempt to become a science it has actually not much more to offer than opinion and propaganda. The four main approaches ― Walrasianism, Keynesianism, Marxianism, Austrianism ― are mutually contradictory, axiomatically false, materially/formally inconsistent, and all got the pivotal concept of the subject matter, i.e. profit, wrong. Economics has NO truth-value, only a political use-value.

Because current microeconomics and macroeconomics is provable false and economists are de facto since 200+ years in the propaganda business they are in NO position to bash the media for propaganda.

Egmont Kakarot-Handtke

Related 'Pre-truth and post-truth in economics' and 'New economic thinking = old political fake' and 'Bad economics, futile critique, and illusive new thinking' and 'Endtime for soap box economists' and 'The thinking economist' and 'Economics between cargo cult, farce, and fraud' and 'Where economics went wrong'