Wednesday, 18 December 2013

Popenomics doesn't exist

I didn't read all of the Pope's 224 pages, or any of them actually. My normal media diet has been enough to pick up on the main point, namely that the Pope said that laissez faire economics will not inevitably lead to economic justice. That upset some economists.

I am no papist - far from it. I was raised catholic but have been happily lapsed for decades. I quite like the multi-theistic approach and if forced to choose a god I'd probably go for Ganesh, remover of obstacles and mischievous happy dude despite being lumbered with an elephant's head - that's him on the right.

I've also listened to the Dalai Lama a couple of times and I credit our friendship with Ahmed Zaoui for disabusing me of a previous prejudice against muslims.

But the pope? He (& its always a he) has usually been irrelevant at best. And at worst? Well it was pretty disturbing that the last one, after hanging around the nazis as a youth, came away with the idea that people should just do what they're told. If you think that way, any normal person would seem like a dangerous radical.

The interesting thing about the current guy's pronouncement on economics though, is it succeeded dramatically in the most important domain: the news media. If you want to examine the economics, read Mankiw and then Avent who concludes, correctly in my view, that
Growth often creates significant injustices which are ameliorated when popular outrage demands change. 
Popular outrage is not easy to spark-off, because by definition it seeks to change the existing order and is therefore challenging to the powerful. Their entrenched structures have a strong in-built resistance to change, so getting a clear message out is essential to making progress.

Economists tend to celebrate creative destruction at the micro level, and the profession has definitely been a force for good.  But the profession is a broad church and seems as divided as the wider population on the questions of poverty and economic justice that the pope was tackling.

We economists can amuse ourselves for ever, examining trade-offs and presenting nicely posed questions to politicians and other decision makers, but there is no real point unless someone will ultimately put a stake in the ground with a clear decision, and even then we may be disappointed. I've certainly advised decision makers and then been at least slightly disturbed by their thought processes. Even when they agree with me (yes, I do offer opinions), I worry that they haven't appreciated the real reasons (yes, I am trying to get over myself.)

So anyway, at this point I'm pro-pope. He's shaping up as a somewhat revolutionary leader (if that's not an oxymoron) and now that Nelson Mandela has passed on, the world could do with another one of those. I'm not going to quibble about the details of whether/how to apply popenomics, because there is no such thing and even if it becomes a thing there will be plenty of scope for concrete policy analysis & debate on actual applications.

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