On Modeled Behavior Karl Smith uses these diagrams, and from it concludes:
“The United States is becoming more educated faster than the economy would absorb educated workers.”
Actually, that statement would attribute value to education that is not demonstrated by the numbers in the market. It would just as likely suggest that ‘education’ has lost it’s meaning, and that being ‘educated’ is becoming disconnected from being ‘productive’ where ‘Productive’ is determined by the return on one’s skills in the marketplace. Islamic countries misallocate human capital too — by educating people in “islamic studies”. Just as westerners do by educating people into the vast literature and pseudoscience of the democratic mythos. We are still educating people as if they’re farm workers moving into industrial labor as if it’s 1949, and in college in particular, educating the middle class as if they are entering a world of comparative privilege – and the market is demonstrating the folly of it. If the absolute number of ‘hard’ degrees has remained constant since 1963, while the percentage of the population with degrees has increased so dramatically, then we cannot have kept pace with technology that increasingly requires hard degrees. SOLUTION?
The market is smarter than planners, politicians and economists. ILLUSTRATING THE PROGRESSIVE FAILURE And this is the second post on Modeled Behavior in three days that illustrates what’s wrong with solving for employment using monetary policy instead of solving for inter-temporal productivity using ALL AVAILABLE POLICY. It assumes that inter-temporal redistribution of money for the purpose of increasing consumption regardless of productive ends has NO EFFECT on future productivity. (Thats the whole problem with Keynesianism isn’t it?) It’s the great progressive failure, It demonstrates the failure of progressive policy. It demonstrates the folly of the progressive hijacking of Keynesian ideas — just as progressives – democratic socialists – have hijacked the world ‘liberal’. (Keynesianism has become synonymous with irrational progressive philosophy despite that it does not have to be.) Progressivism is the philosophy of kicking the can down the road until the entire economy collapses from long term misallocation of human capital. From that perspective the IS-MP approach is even more destructive than IS-LM. FWIW: I’m not an anarchist, but a neo-classical liberal using Austrian methodology. Austrianism is a methodology of observation using Propertarian analysis. Austrian methods have been adopted by people with libertarian sentiments. Libertarianism is a philosophy that is an outgrowth of Catholic Natural Law, which is an a restatement of greek philosophy, which in turn is the science of ‘observation’ of human behavior. From this standpoint, Keynesianism is UNSCIENTIFIC because it denies the observation of some factors in order to provide confirmation of other factors. The purpose of the entire progressive project is the accumulation of state power using methods that produce consequences that are harmful to the polity over the long term. There is no free lunch. There is no ‘natural momentum’ to innovation in an economy. Consumption also consumes differences in innovation that make consumption possible. You can borrow across time, but it’s either an investment or a loss, and both investments and losses are cumulative. BTW: There is nothing that can be expressed in mathematics that cannot be expressed in human language. There is quite a bit that can be expressed in human language that cannot be expressed in mathematics. This is because mathematics is a process of maintaining ratios, and language is a process for determining causality. Curt