Goethe quote

Every school of thought is like a man who has talked to himself for a hundred years and is delighted with his own mind, however stupid it may be.
(J.W. Goethe, 1817, Principles of Natural Science)

From the Schools of Thought page of the History of Economic Thought site. I think that site is a very good starting point for serious economic study.

update (25th December): Here is a counter balancing quote, from the HET introduction page, also from Goethe

Somebody says: "Of no school I am part,
Never to living master lost my heart,
Nor any more can I be said
To have learned anything from the dead."
That statement - subject to appeal -
Means "I'm a self-made imbecile."
(J.W. Goethe, Den Originalen, 1812)

Paul Samuelson developed Frankenstein

Economist Paul Samuelson has just died (age 94) so there was some coverage about him on the PBS NewsHour (my favourite news source) tonight.

As part of my economic study I am currently acquiring an overview of the mainstream neo-classical schools (they argue amongst each other). I'm impressed by the History of Economic Thought website. They have a summary of the various schools of thought which is more coherent than wikipedia. Wikipedia is not bad but tends to be more muddled and padded than the HET site.

Anyway, according to the NewsHour interview with David Warsh, Paul Samuelson was one of the four most influential economists of the 20th Century, the others being John Maynard Keynes, Milton Friedman and Kenneth Arrow. (Late Economist Samuelson Bridged Math, Money). From what I've read Samuelson was very good at developing mathematical arguments to update and refine Keynesian type government interventions into the economy.

Given his importance what he said about the current crisis, at the start of it, is interesting:

PAUL SAMUELSON: I'm really very realistic about the mess that we are in. People compare it with the Great Depression. But the Wall Street shenanigans this time are much worse. And people like me, who lived through the Great Depression, as a young, budding, kind of bright economist, are in great demand because the other people don't have a clue as -- as to what this kind of situation is.

PAUL SOLMAN: Well, what did Wall Street do this time that it didn't do last time?

PAUL SAMUELSON: This is the first time ever that this happened after the -- and I have to use my words very carefully -- fiendish, Frankenstein monsters of financial engineering had been created, a lot of them at MIT, some of them by people like me.

And these are marvelous things which can be used to spread risks rationally, and, in that sense, reduce riskiness. But the Frankenstein part of the story is that they also are marvelous things, Samson-like, to blind you. You don't know what you're doing. All transparency disappears. What's happened this last eight years is an absolutely unnecessary thing.

neither an alarmist nor denier be

Richard Burton once when approached by a beggar quoted Shakespeare:

"Neither a borrower nor a lender be -Shakespeare"

The beggar responded:

"Get fucked - Henry Miller"

That's pretty close to how I feel about the global warming pretend debate.

James Hansen sounded convincing on Lateline when interviewed by fellow alarmist Tony Jones. When I watch a seemingly reasonable and well researched scientist like Hansen I start to think who am I to question this?

But then when I read a counter argument by Richard Lindzen, a qualified environmentalist, (The Climate Science isn't Settled) then I wonder why the ABC takes the easy path of having an alarmist interview another alarmist. Why don't they set up a real debate between Hansen and Lindzen?

The ABC has already decided on the truth and present us with a carefully massaged version

It is still best to be neither an alarmist nor a denier. I would describe myself as a lukewarmist. Perhaps I should set up a political party but lacking the stridency and certainty of those who are sure it would not receive many votes.

Lindzen:

The notion that complex climate "catastrophes" are simply a matter of the response of a single number, GATA, to a single forcing, CO2 (or solar forcing for that matter), represents a gigantic step backward in the science of climate. Many disasters associated with warming are simply normal occurrences whose existence is falsely claimed to be evidence of warming. And all these examples involve phenomena that are dependent on the confluence of many factors.

Our perceptions of nature are similarly dragged back centuries so that the normal occasional occurrences of open water in summer over the North Pole, droughts, floods, hurricanes, sea-level variations, etc. are all taken as omens, portending doom due to our sinful ways (as epitomized by our carbon footprint). All of these phenomena depend on the confluence of multiple factors as well
- The Climate Science isn't Settled

Lindzen's argument conforms with my belief that sustainability, although in some cases maybe a desirable goal, is not a possible goal. There is no ideal climate for the earth, there has never been any long term stability in the earth's climate or anything else for that matter. The idea that we can achieve this is ludicrous.

Previous blogs about this:
the case for unsustainability
the left and right of global warming
the problem of too much bullshit