Some economists aren’t pathetic

While I agree with Nassim Taleb that economists are generally pathetic, not all are. Count Don Boudreaux, David Rose and David Henderson as economists who are not.

While there are many instances where Boudreaux proves his worth, this recent post of his on Cafe Hayek is ample evidence.

First, Boudreaux reprints a letter from economist David Rose that was published in the Wall Street Journal. Rose’s letter proves his worth. I’ve reprinted it below. It’s a must read.

Second, Boudreaux reminds us of a most excellent point made by David Henderson that proves his worth. Henderson pointed out that using the term wealth redistribution incorrectly implies in market economies that there was wealth distribution to begin with. There wasn’t. There was wealth creation from risk-taking and value discovery.

Here’s Rose’s letter:

In his Dec. 20 op-ed “America’s Dangerous Powerball Economy,” Arthur Brooks quite correctly points out that earned income, indeed earned success generally, affects our happiness very differently than unearned income or success.

I would like to extend his point further with something I’ve told my college students for years.

In general, the creation of wealth is edifying. When only voluntary transactions are permitted, the creation of wealth requires cooperation, and this brings out the best in us.

Piles of wealth, however, tend to be corrupting. The fixed nature of a pile is all about apportionment, not cooperation, and this zero-sum game tends to bring out the worst in us.

It follows directly that no matter how noble the ends, government redistribution (which is hardly voluntary) tends to bring out the worst in us. Rising government redistribution over the past 75 years has produced ample evidence of this point.

We are in this mess because we have allowed our culture to be dominated by those who are bent on spreading the false and self-serving narrative that our economy is a giant zero-sum game.

As such, we might as well have the government do the dividing.

Small wonder why our politics have become increasingly about who you are for rather than what you are for.

David C. Rose

Department of Economics

University of Missouri-St. Louis

St. Louis, Mo.

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Excellent Post and Comments at Cafe Hayek

Russ Roberts made reference to David Rose’s good work in his post Justice and the Rule of Law at Cafe Hayek.  The comments section was good too.  Key paragraph from Rose’s work:

But a consequentialist judge would look beyond the law and consider the insurance mandate’s impact on society. Using this criterion, the consequentialist judge might see the mandate as a “benefit to public health” and a “compelling state interest.” Such thinking would lead to a loose interpretation of the Commerce Clause and an affirmation of an unprecedented loss of personal liberty in America.

Commenter MichaelSmith writes:

“Consequentialist” — at least as it is being used in this context — essentially means “collectivist”. It is an effort to obliterate the concept of individual rights in the context of evaluating the Constitution by substituting, instead, the thoroughly collectivist notion that “the public good” — or some similar allegedly superior “right” of the collective — trumps and cancels individual rights.