Comment by skrellm | Hacker News Reader

Comment by skrellm | Hacker News Reader

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> When it comes to the economic side of things, I believe the best approach right now is to learn all major schools

Also it wouldn't hurt the economy if it were based on actual math. At the university I had to learn micro and macro economy (thankfully just one semester each), and my book was full of impossible things: graphs without units, confused linear and exponential trends, obviously wrong greater-than and less-than relations...

> On the political one, I fully agree. In fact, I wish lottery was used extensively, including for executive roles. There's research showing it results in way better outcomes all around, as politics ends up somewhat close-ish to having traits similar to the average of a population, rather than lower than it, as in other models.

I think it should not necessarily be the average of a population. For example, executive roles could be chosen randomly from a pool of people with suitable curriculum. Or a judge for a case from a pool of available judges, etc. This would make wonder for audits and fighting corruption, as long as the lottery is fair and public.

But no matter how good a system is, if a small wealthy group can overrule the Founding fathers' breaks and balances with a simple Congress hearing, well, then that system is hopeless and surely doomed to fail. Rules that oligarchy must obey and can't twist to their liking is essential for democracy, otherwise tyranny emerges. Ancient Greeks knew this, and we can clearly see that they were right.

Economics cannot really use math well because monetary units don't have proper cardinality, carrying more of an unholy mix of cardinal and ordinal properties that also aren't fully consistent with themselves. The non-monetary inputs and outputs are more regular in how they function, but the in-between is utterly weird, and everything trying to make sense of it is valid only under very narrow conditions. Step outside those and the reasoning fails.

On politics, agreed!

Yeah, that's what economist say, but don't you feel this somehow fundamentally wrong and just a pity smokescreen?

I mean after all economy is all about money, measured in numbers: stock prices, exchange rates, interest, balances, income, etc. numbers and numbers and numbers all over, everywhere.

Shouldn't math be the most important thing of all in a field entirely made up by numbers? How come it's not? Isn't that a bit strange?

IMHO Adam Smith was a conman, so no wonder that economists are too. Free market leads to best products at smallest prices? Just look at any real world market: profit maximization is all about oppressing and killing the competition, cutting expanses (so producing poor quality goods), sold as expensive as possible. Reality is literally the opposite what Smith said. Again, IMHO.

Consider this simple example, taken from the Austrian school (their criticism of other economic schools is pretty good; their proposed solutions, not so much):

Suppose you have $3 in hand, and you want a printed issue of the NYT. You take your $3, give it to the newsstand owner, and he gives you a NYT issue.

Why did this exchange happen, rather than no exchange at all?

From your perspective, because you value having a printed issue of the NYT more than keeping your $3, otherwise you'd have kept the $3 and not bothered.

From the newsstand owner, because he values having $3 more than maintaining that copy of that NYT issue on the stand, otherwise he'd have refused your money.

So in the exchange both sides perceive it as increasing their respective satisfaction, so both profitted from it.

Hence, the question on which is worth more, the bills and coins amounting to $3, or the printed issue of the NYT, is meaningless without adding a necessary qualification or "for whom".

That very basic weirdness is inherent to all monetary exchanges, and it builds up from there when we move to aggregates.

PS: Adam Smith didn't say much of what's attributed to him. The "invisible hand" metaphor was something he remarked en passant as a side note, and it wasn't in any way a core part of this theory. In fact, if we read him we find a lot of criticism of the worst parts of Capitalism. His criticism of rent seeking, for example, is brutal, and he was a strong supporter of free public schooling paid for by the State, among many other things.

A very nice author, with good ideas amidst bad ones, unfortunately utterly distorted by his so-called "supporters" who didn't actually read his works.

> Consider this simple example

Exactly the kind of smokescreen I was talking about. "Perspective", "profit of the customer"? All non-sense, deliberately trying to derail you. What matters here is: how much did the newsstand owner pay for the NYT copy and how much did he get by selling it. Basic, elementary school level algebra, nothing more. That's all there is.

> Adam Smith didn't say much of what's attributed to him.

Yes, I know. But he undeniably did say that "free market leads to the best products for the smallest price", that's the core of The Wealth of Nations, and it's all a lie (we can easily see that by looking at the real world, free market leads to monopoly, which is the opposite of healthy competition).

> unfortunately utterly distorted by his so-called "supporters" who didn't actually read his works.

Yeah. This always happens. How come Jesus saying "you must love each other" became distorted as "kill each other in holy crusades"? Or that Marx's "no ruling class" theory was turned into the Kremlin?

Regardless I still think Smith was a conman, because I think he was smart enough to realize his core ideas were a lie. His ideas can only work if all goods were equal, which is hardly true in real life (actually companies do anything to make their product different from the competitors', and if they can't do that, then they bribe, sue, acquire etc. so they do anything to make their product the one and only on the market).

In other words Smith was talking about selling chicken eggs but made it look like if those principles were true for selling any kind of goods, and I'm certain he was well aware of this lie. He was simply too smart to make this error by mistake.

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