Saturday, March 03, 2012

‎"Nothing is easier than to have good intentions but, without an understanding of how an economy works, good intentions can lead to disastrous consequences for an entire nation. Many, if not most, economic disasters have been a result of policies intended to be beneficial - and these disasters could often have been prevented if those who originated and supported such policies had understood economics." - Basic Economics, Thomas Sowell

2 comments:

Nick Barrowman said...

I'd like to raise two issues. First, how would we define "good intentions"? When there is talk of "policies intended to be beneficial", we might ask, "Beneficial to whom?" Inevitably politics comes into play, persuasion and marketing are employed, and the stated goals may not be the real ones.

Second, Sowell presents a rather black and white vision. He refers to what might happen "without an understanding of how an economy works" and what might have happened "if those who originated and supported such policies had understood economics". Surely economics is not so cut and dried. Does anyone understand how a real economy works? Has economics progressed to the point where the main problems have been satisfactorily dealt with?

Sam said...

Personally, I find quantum physics easier to understand than economics. There are a lot of well-intentioned people, but I sometimes think that economics is like what Richard Feynman said about quantum physics: "Anyone who says that they understand Quantum Mechanics does not understand Quantum Mechanics."