When Civilizations Collide: Economists and Politicians

As it often happens when civilizations collide, politicians and economists each find the other to be a bit strange. There are, in fact, important differences between the two groups, not only in their goals and motivations, but in key areas such as ways of thinking and speaking. For example:

Logic. You might think that logic is logic. However, I would describe the logic used by economists as Aristotelian logic – that is, the classic system of logic based on syllogism, corollaries, and deductive reasoning. Politicians often don’t use this logic. They are instead using what I call political reasoning – what will work best with the electorate or with the other politicians they negotiate with.

language. On the basis of reasoning, the language that we economists use to speak and write is often dry – sometimes barely intelligible to ordinary people. In contrast, the language in which politicians like to speak and write is often lively – and in plain English. But because it’s so full of spin, economists tend to be restrained when we hear it.

Calculation. … Economists use arithmetic and, when necessary, calculus. Economic equations can be complex, but they are straightforward in that they follow the rules most of us learned in math class. But the political arithmetic is different – it is weighted by influence. …Imagine a policy that generates $1 million for every 10 people, and costs 10 million people $2 each. Doing simple economic calculations, we can quickly see that the policy leads to $10 million in gains and $20 million in losses. So we conclude that it is probably a bad idea, unless there is a good reason to do so despite the loss of wealth. But if you apply political calculus to the same numbers, … [t]The 10 people you help a lot will care deeply and may even show their gratitude for political donations. Meanwhile, the 10 million people who lose $2 each probably won’t even notice. So this policy has a political advantage.

intelligence. Academic economists value traditional intelligence as coming from things like a high IQ, good ideas, and the ability to express those ideas. Success in academic economics does not usually depend on people’s skills. On the other hand, successful politicians rely more on their social and emotional intelligence. …

Goals. Economists who engage in politics generally attempt to maximize social welfare. Politicians, of course, try to maximize their odds of being elected or re-elected, which may not be related to welfare.

Policy evaluation. The aspect of politics that matters to economists is the essence of politics: is it really good for society? What matters in the political world is, of course, the politics and the message involved in politics. Does it look good? Needless to say, what he is good and what sounds The good is not always aligned.

Fears. The main concern of economists is efficiency: we talk about it, we think about it, we dream about it. But efficiency matters little to politicians, who care much more about fairness, or perceived fairness, a broad concept that includes income distribution but also much more.

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