Garett Jones - ThisIsCommonSense.org

How do you get a body of professionals to go along with your program?

Pay them.

It’s an old idea: He who pays the piper calls the tune.

The pipers are economists. The paymaster is not you, but the Federal Reserve. There’s a suprising amount of agreement amongst even disagreeing economists that the Federal Reserve is, on the whole, “a good thing,” a necessary thing, even an institution whose existence and rationale must not be questioned.

Shocking, but less so when you apply what is called “Public Choice” analysis to economists themselves. Assume that economists are self-interested. Assume that they like to get paid. Opinions turn out to be somewhat elastic, even given some very hard facts. The results?

Don’t bite the hand that feeds you.

Nicely, a few economists bring this up, every now and then. Garett Jones on EconTalk did, reviving a letter monetary economist Milton Friedman wrote to researcher David M. Levy in the early 1990s. Friedman summarized the situation concisely, saying that the Fed

hires directly roughly half of all economists specializing in the field of money, and indirectly provides funds for a large fraction of the remainder. I have no doubt that is a major reason why the Federal Reserve, despite such a poor record of performance, has such a high public standing.

This also helps explain why there was a major shift away from laissez faire amongst economists. In the 20th century, the “worldly philosophers” developed a new labor market; they found that they could make a great deal of money working for government. And they don’t get paid for telling the government not to do what it wants to do, or to fire most economists.

This is Common Sense. I’m Paul Jacob.

I think of people as basically good. Most folks treat me well enough. I can navigate my neighborhood at night; I can go to an ATM unmolested in most cities I visit; often, I get smiles — and it isn’t because of my extraordinary good looks (alone).

But evil is all around us. Some folks harbor deep resentments, and worse. Garett Jones, writing at EconLog, notes that “a lot of people are actually just awful.…

In a series of studies of male college students in the 1980’s, Malamuth found that about 35% of these students in the U.S. and Canada said they’d consider committing a rape if they knew they wouldn’t get caught; 20% would seriously consider it.… And these studies are just detecting those students who are willing to state their proclivities in a survey; the true number is surely higher.

We are, all of us, constantly surrounded by such people.

Jones draws a startling moral: “I suspect that if people were more aware of the awfulness of their neighbors, support for the welfare state would decline.”

He may be right, but contemplating crime is different than committing it. The move from wish to action often depends on “context.”

Studies have shown this. Clean up your neighborhood, replace broken windows: crime goes down.

Some social engineers argue that the welfare state is more than mere window-dressing, it’s a swap: The dole buys off potential criminals.

I suspect the opposite is true: It funds criminals, supporting their bad habits, and serves as a trap for everyone else, preventing the vast majority from climbing out of the velvet cage.

We should work for better contexts.

This is Common Sense. I’m Paul Jacob.