Economics: An Opportunity for ID “Science”?
Frank J
sure how to go about it, because economics is far from my area of
expertise. Given the urgency of financial crisis I’ll just throw out
my half-baked idea for comment.
As usual, a little background is in order. I remember hearing a radio
business report ~30 years ago and being suddenly perplexed at how
everything was so “reactive,” e.g. “the US markets were down because
the foreign markets were down,” etc. Stocks were up because of bargain
hunters; they were down because of profit taking. Everyone had a
simple “naturalistic” cause for everything. But there were always
enough data out there to rationalize any outcome. Worse, people have
free will. Why, I thought, are they treated like mindless particles,
just following laws of physics?
As you can see I had a frustration about economics that was quite
similar to that of those who don’t understand evolution and thus find
anti-evolution sound bites compelling. Nowadays, I realize that, in
large numbers, known “intelligent designers” indeed do predictable
things despite their free will. So “naturally” economics uses the same
cold, impersonal language as evolution and any other science.
By now you’re probably way ahead of me. ID has failed miserably as a
potential new science of biology (that it never tried may have
something to do with that :-) ). So here’s a golden opportunity for
ID to shine as science, even if it’s in the “dismal” science. To
start, ID can tell us which, if any, economic systems are “irreducibly
complex,” and thus would require overarching design to “fix.” If so,
while economic experts are hopelessly confused at how much government
intervention is necessary to fix this situation that they mostly admit
is unprecedented, ID “theorists” might be able to predict, based on
the arguments they failed to apply to biology, whether this requires
more design, or whether the free market will “repair itself” best with
minimal meddling.
Robert Carnegie
One: the government's remedial action is indeed intelligently
designed. Watch this space to see how that goes.
On the other hand, if the administration wanted a huge barn of money
to give to friends... well, it isn't completely without oversight.
As for not designing the market, every player is trying to impose
their own design on it. But also, people figuring out secret money
market logic and using it for business, is how we get /into/ these
fixes. Hedge funds? Automated trading? Internet technology changing
everything? All of these have wrecked us before now.
Frank J
>
> - Show quoted text -
Not sure what you mean, but my post was half-serious, and the serious
part is how everyone, ironically including many fundamentalists, treat
economics as if it were based entirely on chance and necessity. It
might be, of course, but as with biology, we just don't know that. All
we know is that only C&N explanations work, and those that invoke
design do not. Will they work for economics? My guess is no, but I'm
not as positive as I am with biology.
This morning on the radio I heard the usual "coming up next" nonsense
that forces you to listen to an obnoxious commercial or, as I do,
switch channels. What was "next" was how "everyone" missed the root
cause of the financial crisis. Guess what the "root cause" was?
Falling home prices! Sorry, I consider that just another effect, with
its own root cause. To me the root cause is an accumulation of
unrealistic expectations of both buyers and sellers. Or to put it more
bluntly, plain old greed, aggravated with rampant "innumeracy."
Robert Carnegie
Upon reflection, an "intelligent design" approach only could
distinguish "intelligent" market activity from ordinary market
operations. For instance, insider trading could be detected. I
gather that this in fact is done, but not particularly with the help
of the Discovery Institute.
But I don't anticipate ID particularly solving market problems. ID is
about detecting someone else's intelligence, not using your own.
As for the cause of the crisis, isn't it basically the use of complex
"financial vehicles" - securities - to wrap up assets, a conflict of
interest for agencies interpreting the values of the assets in those
vehicles and also selling them - or getting paid by the seller - and
specifically mortgages dealt in the market inside those vehicles,
mortgages whose value to the holder of the security, effectively the
lender, turns out to be less than advertised - much less? Which in
turn is because of a housing price boom that encouraged people to get
into real estate whilst also making it more expensive to do so - so
that people took out deals that they couldn't afford, deals that the
point-of-sale lender shouldn't have done, deals where they had no
regular salary to make payments, deals where they could afford the
introductory low payments but not the payments after that? On top of
cases where someone lost their job or got sick and couldn't keep up
the deal. And the housing boom in turn was said to be because after
the /last/ crash, the dot-com and Enron busts, people in the U.S. who
still had money saw real estate as the safer investment, and all went
there?
But I think the fundamental problem was the asset valuing agencies
giving triple-A rating to financial goods that were just shrink-
wrapped crap. If it hadn't been bad mortgages then it would have been
some other kind of worthless financial material inside the boxes.
However, because it was mortgages and consumer lending, and also
because mortgages and consumer lending were funded from stock trading
and money market lending, the stock market and lending collapse means
that what we're now calling "Main Street" can't get a loan or a
mortgage now.
Perhaps you're interested to hear my idea for a solution. It may
involve public executions, or anyway hard labour. And a dash of
socialism, that dreadful anti-American idea that people shouldn't ever
starve to death, for instance, in any halfway properous country.
Desertphile
<rja.ca...@excite.com> wrote:
> Frank J wrote:
> > I have been meaning to write about this for years, but have not been
> > sure how to go about it, because economics is far from my area of
> > expertise. Given the urgency of financial crisis I?ll just throw out
> > my half-baked idea for comment.
> >
> > As usual, a little background is in order. I remember hearing a radio
> > business report ~30 years ago and being suddenly perplexed at how
> > everything was so ?reactive,? e.g. ?the US markets were down because
> > the foreign markets were down,? etc. Stocks were up because of bargain
> > hunters; they were down because of profit taking. Everyone had a
> > simple ?naturalistic? cause for everything. But there were always
> > enough data out there to rationalize any outcome. Worse, people have
> > free will. Why, I thought, are they treated like mindless particles,
> > just following laws of physics?
> >
> > As you can see I had a frustration about economics that was quite
> > similar to that of those who don?t understand evolution and thus find
> > anti-evolution sound bites compelling. Nowadays, I realize that, in
> > large numbers, known ?intelligent designers? indeed do predictable
> > things despite their free will. So ?naturally? economics uses the same
> > cold, impersonal language as evolution and any other science.
> >
> > By now you?re probably way ahead of me. ID has failed miserably as a
> > potential new science of biology (that it never tried may have
> > something to do with that :-) ). So here?s a golden opportunity for
> > ID to shine as science, even if it?s in the ?dismal? science. To
> > start, ID can tell us which, if any, economic systems are ?irreducibly
> > complex,? and thus would require overarching design to ?fix.? If so,
> > while economic experts are hopelessly confused at how much government
> > intervention is necessary to fix this situation that they mostly admit
> > is unprecedented, ID ?theorists? might be able to predict, based on
> > the arguments they failed to apply to biology, whether this requires
> > more design, or whether the free market will ?repair itself? best with
> > minimal meddling.
> One: the government's remedial action is indeed intelligently
> designed. Watch this space to see how that goes.
>
> On the other hand, if the administration wanted a huge barn of money
> to give to friends... well, it isn't completely without oversight.
Section Eight of the recent $700b welfare package to the wealthy
says it is completely without oversight.
> As for not designing the market, every player is trying to impose
> their own design on it. But also, people figuring out secret money
> market logic and using it for business, is how we get /into/ these
> fixes. Hedge funds? Automated trading? Internet technology changing
> everything? All of these have wrecked us before now.
--
http://desertphile.org
Desertphile's Desert Soliloquy. WARNING: view with plenty of water
"Why aren't resurrections from the dead noteworthy?" -- Jim Rutz
Robert Carnegie
It thought oversight was added as a debated amendment?