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RE: My Response to the Atlantic's The Curse of Econ 101

in #economics7 years ago

For me, the problem comes down to the use of force.

In my experience, this is quite weak argument. It doesn't usually change anybody's mind.

In this case maybe better way of argumentation would be to say that in the real world things are not simple. It might be true in some cases that minimum wage will be beneficial, but it doesn't mean it's a good idea to implement.

To have a minimum wage, we need to have an institution that have power to decide how much the wages should be. That is very great responsibility. We can't just let anybody have that power. We need to make sure that the institution will use that power only for good and never for bad and that is completely different problem.

People who advocate minimum wages or some other socialist solutions never tell how these institutions should be designed. As we have seen, usually all kind of central planning will fail in someway.

So it doesn't matter whether or not you can find research that says that minimum wage is ok until you have a system that can set the price to a beneficial level and keep it in there for long term. So far we haven't seen anything like that.

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When it comes to the strength of an argument, should it be about changing minds or about truthful accuracy? You may be right that it doesn't change people's minds and maybe that does make it a weak argument, but I still feel it's the right one. Starting with morals enables of to clarify what "good" and "bad" even means within the context of the discussion.

So it doesn't matter whether or not you can find research that says that minimum wage is ok until you have a system that can set the price to a beneficial level and keep it in there for long term. So far we haven't seen anything like that.

Excellent point. I think it goes back to the moral problems we have with failures we see all over regarding centralized, corrupt power and socialism gone bad.

Now, to play devil's advocate a bit, I also think there's an argument to be made for where things work rather well, such as the nordic countries which are highly socialized but don't have the same dictator/tyranny structures of government. My friends who support government will argue, "We just need to do more of what they are doing" and I have to admit, from a certain perspective, they have a point. Again though, I'm not okay with the fundamental moral position of national governments which I view as a monopoly on the use of force within a geographic region. Eventually, from my perspective, it turns into human farming.

When it comes to the strength of an argument, should it be about changing minds or about truthful accuracy?

I don't think it's either-or question. You can have both.

You may be right that it doesn't change people's minds and maybe that does make it a weak argument, but I still feel it's the right one.

Are you talking to yourself or preaching to the choir? It might be fun to write exactly as you would like to see written, but that doesn't change the world. IMHO libertarian activists could be much more efficient if they would test what kind of argumentation is best and use it, and not stick to the kind of that just feels good.

Now, to play devil's advocate a bit, I also think there's an argument to be made for where things work rather well, such as the nordic countries which are highly socialized but don't have the same dictator/tyranny structures of government. My friends who support government will argue, "We just need to do more of what they are doing" and I have to admit, from a certain perspective, they have a point.

There are certain elements in Nordic countries that work well, like rule of law, low level of corruption and property rights. But most of the socialist elements don't do so well.

For example, here in Finland we have massive unemployment because of bad regulation and high taxes. Usually people who admire Nordic countries don't want to see it. It comes from the bad institutions, which originally were set up by well-meaning people to help the workers. But it's really difficult to produce good regulation and find the optimal level for taxation so it all failed. And now we can't get rid of those institutions and have to live with them.

Usually people who admire Nordic countries don't want to see it. It comes from the bad institutions, which originally were set up by well-meaning people to help the workers. But it's really difficult to produce good regulation and find the optimal level for taxation so it all failed. And now we can't get rid of those institutions and have to live with them.

Very well said. Institutions and organizations (especially government ones) are like organisms whose sole purpose is to survive and multiply. Killing them off is quite difficult.

IMHO libertarian activists could be much more efficient if they would test what kind of argumentation is best and use it, and not stick to the kind of that just feels good.

Great point, but the challenge for me is giving up the perceived "moral high ground" in doing so. If the argument is based on a morally superior stance, that's the one I want to use while appealing to a virtue ethics perspective. If clickbait headlines and such are more effective, is that really the direction we want humanity to go? Maybe it's an ends justify the means thing... but it's certainly a tricky thing to figure out. You might get what you want only to realize you lost your way along the path and are now at a completely different destination because the moral framework has shifted.

Great point, but the challenge for me is giving up the perceived "moral high ground" in doing so.

You can use the moral high ground, but don't use it as your primary argument. If somebody wants to talk how economics 101 is too simplified, you should first address that. After you have built a good argument based on economics, you can add "and btw, my stance is also morally superior".

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