Painting Oneself into a Corner

This Post is an example of Economic theory painting itself into a corner. Kosfeld, Huck, and Dillow fail to consider the Countercyclicals. Suppression of burglary and/or limitation of Sentence stringency have exterior factors. Nonsuppression of burglary, likewise for intermediate Sentences, leave more criminals on the streets which Police must supervise. Continual investigations of burglaries absorb great amounts of Police labor; labor which is diverted from more convoluted and potentially more violent crime, which take a huge number of Police man-hours to track. Nonsuppression of burglary, therefore will naturally increase other acts of Crime in other areas. A natural economic resolution of Police enforcement has already been established, with Police labor devoted to each area of Crime as to maximize Crime prevention; criminal Sentencing equally economically suiting both the interests of Crime prevention and retribution for Civic violation. Why do Economists always think they can regulate better than natural market forces?

One should read the links to Mark Thoma and Arnold Kling before reading the rest of PGL’s Post. What amazes me about both the Climate Crisis and the Social Security Crisis lies in the universal expectation that both will arrive; they will both come, but neither can be expected to be that much of a Problem. Everyone acts like the Health Care Cost issue cannot be resolved, that the federal Tax system will never be altered to fund future solutions, that the overflow of Capital by untaxed Profits cannot be diverted to absorption of the National Debt, and that Productivity and the Return on Venture Capital will always be greater than today. I would not put Money on any of those beliefs.

Ed Prescott and Greg Mankiw still seem ‘To Not Get It”. American labor can integrate the concept of Creative Destruction; they don’t like it much, but they understand it. The rub comes when these Workers ask what replaces the industries lost. Economists always respond with greater Training which they can neither afford or reach due to Jobs Skills limitations. Modern Economists would leave Labor to ‘whither and die’, a real Concept with which American Labor finds some fault. Adequate Economic Policy must devise alternate employment opportunities for all Labor, not just Advanced Jobs Skills. lgl