Keep it simple?

Not to worry, we’ll scale up later, soothes the techno-managerial elite. Later on, presses the happy-talk, we’ll relax assumptions and add realism. Don’t bother yourselves with quibbles; we know how to reduce inequality (just give them a Universal Basic Income!), overpopulation (just don’t have babies!) and save the environment (just don’t cut down the trees!). So much of these just-this suffocate in their own fat of “stop thinking about the uncertainties and get on with it!” This time it’s different, they insist; we really do know where to start, they insist. They insist: Just leave the complications to academia.

A war? Not to worry, economists tell us, it only amounts to some 1% of national income. Lost $350 million in one quarter? Not to worry, that’s small beer when compared to the university’s endowment of $30 billion. Lost over $5 billion in trades? Little more than a flesh wound when compared to all the firm’s profits and assets. Government is predicted never to have a budget surplus again because of financial crises? Not to worry, there’s no need to balance the budget if the country’s nominal GDP normally grows at 5 percent per annum.

What’s going on here? Has economics lost the plot, like the actor playing Hamlet, who finished the bedroom scene with Gertrude but forgot to kill Polonius?

The only difference between the advocates of this kind of economism and Professor Sir Anthony Blunt, art historian and KGB agent seeking to undermine capitalism from within, is that Blunt didn’t have as good a roadmap to subversion as the Efficient Market Hypothesis, Value at Risk Model, and other such weaponry during the last financial crisis.

(Auguste Comte, sociology’s founder, is reported to have had such an aversion to economics that he tried convincing French officials to establish a chair in the history of science financed by abolishing a chair in economics. Now that’s what economists call a trade-off!)

The chief problem with “start simple and then scale up” is that each scale/level is complex in its own right. The map smooths out shoreline, but visit the shore and there’s nothing there so smooth that way. To start simple and scale up makes as much sense as trying to pinpoint the shoreline through the eye of a needle.

But, still, they insist, not to worry: After all, there’s the New Monetary Theory, which says it’s alright to…to what? Piss on your shoes, but claim it’s only a light shower? Wrong. We make cuckoo clocks without the bird-shit, but that’s about the extent of it. Again, complex is about as simple as it gets these days.

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