I missed the Jim Stanford seminars in June, led by the NZ Fabian Society called “Economics for Everyone”, but I’ve been reading his book (Pluto Books 2008).
It’s an appealing book for those who are sometimes bewildered by the technicalities of the economy and especially for people who think the economy is about someone else.
Stanford argues that you don’t need to be an economist to know a lot about economics and anyway, it’s too important to be left to the economists.
Everyone experiences the economy, everyone contributes to it in one way or another and everyone has an interest in how the economy functions, how well it functions and in whose interests it functions.
“Economics is about how we work, what we produce, how we distribute and ultimately use what we’ve produced. Economics is about who does what, who gets what, and what they do with it.
And moreover because we interact, cooperate, and clash with each other in the economy, economics is a social subject.
It’s not just technical, concrete forces like technology and producutivity that matters. It’s also the interactions and relationships between people that make the economy go around.”
Stanford says that unfortunately, many economists don’t see the world in this way. They use complicated, technical mumbo jumbo to make their case and claim to know what’s good for people – better than the people themselves know. And since they study things that are measured in billions or trillions of dollars their sense of importance grows, in their own eyes and in others.
Stanford argues for a more democratic and grass-roots approach to economics that starts from the concrete circumstances of average people’s lives, and that ordinary people have valuable economic knowledge – knowledge that’s usually ignored by the experts.
” A society in which ordinary people know more about economics, and recognise the often conflicting interests at stake in the economy is a society in which more people will feel confident deciding for themselves what’s best – instead of trusting the experts. It will be a more democratic society.”
This is just a taste from the introduction. I’ll try to post on more from the book, because it’s a great read.
But just in case you should read it yourself. Have look at the website.
I suggest that the majority of economists and current (self-proclaimed) economics experts will hate this idea. I mean, what is the point of paying someone a lot of money per hour to give their specialist interpretations based on their favourite pet economic theory/ideology, if ‘ordinary people’ become able to contribute to the economic discussion just as meaningfully? (And maybe more so?)
Further, if the public became less fearful of the topic and became more able to converse in economic concepts, then a government would find it that much harder to pull of a swindle of a budget.
Agreed, Darien
Remember when law and its obtuse language left the people in the dark? Then there was a strong long process of demystifying the lingo. Mostly now you can make sense of the law.
So. How about the same for Economics? It would make it very difficult for Bill English to cloud the issue with huge numbers and confusing statements because he would be forced to speak in plain English instead of Bill English speak!
lol Ianmac
Tilting at windmills? Here’s a quote from Ludwig von Mises:
and claim to know what’s good for people – better than the people themselves know. And since they study things that are measured in billions or trillions of dollars their sense of importance grows, in their own eyes and in others.
Remind anyone else of government?
BTW Here is a good introduction to economics you can download for freeFaustino Ballve’s Essentials of Economics
I think Co-ops are an excellent way to get everyone involved in thinking about the economy and finance… We have a great start here with two of our top ten biggest companies as Co-ops… Maybe Labour could develop some legislation to foster more traditional companies to assume Co-op status rather than just the farmers and kiwi fruit growers…
Good post Darien.
Those who make their fortunes out of the manipulation of money without material gain to the society as a whole, are not contributors but takers. Methods of taking wealth without adding profit to wider society are strongly defended by those allied to those processes. All the words and economic policy are much of a smoke screen to those processes that see the availability of wealth being further constricted to a tiny percentage of our population, the global takers.
Keep an eye on the growing group of 20% within NZ that have negative wealth and the growing percentage of our wealth held by the top 10% who currently hold over 50% of our wealth.
The top 50% own 95% of wealth in NZ leaving the bottom 50% only 5% of the wealth, but more recent figures have lowered the wealth held by the bottom 50$ down to 3% of the wealth.
Strangely our PM is Merchant Banker, shoe horned into the job. He will not provide any leadership to change this worsening situation.
For me, the study of economics was an enormous enlightenment. As with many good studies, however, it continues to raise as many questions as answers.
Enjoy the journey!
@John W you talk of ‘our wealth’.
Care to elaborate?
Heh! Just a bit.
Darien great post – I will definitely read that book. While any academic has the ability to intellectualize everything and hide the points within ‘gobbledegook’, economists seem to do this the most. Something that economists seem to never grasp, is how to translate academia into everyday language. They seem to prefer to keep their arguments in-house outside the grasp of the community at large in conjunction with the arrogance referred to above.
Re ““Economics is about how we work, what we produce, how we distribute and ultimately use what we’ve produced. Economics is about who does what, who gets what, and what they do with it.”….crikey that takes me back in time to 6th Form economics!
Re “They use complicated, technical mumbo jumbo to make their case and claim to know what’s good for people – better than the people themselves know.”…..hmmmmm sounds suspiciously like the 5th Labour government!
Copied from my blog site which has the link to the quote be,ow.
Kia-ora
“Debt-based money requires growth. If we had a stable population engaged in stable and sustainable activities using non debt-based money as their freely circulating medium of exchange, then there would be no “need” for economic growth. Zero percent economic growth would work just fine”.
Governments are still talking about economic growth as their main goal. It is our Governments only goal. Constrained only by the amount of wealth distribution towards big business they can get away with and still be elected.
The fact is in NZ we have the resources for all of us top live well without growth. The need for growth is a function of how debt funded capitalism works.
It is time we all thought about a paradigm change in our economic system as continual growth is not possible without taking from future generations,
Growth is not sustainable!
kjt-kt.blogspot.com/
This fellow has an interesting take on kiwis and economics: http://offsettingbehaviour.blogspot.com/2009/03/what-makes-kiwis-think-like-economists.html
Maybe it should have been called:
What makes Kiwi’s think like socialists..?
JMH – nice……I think the answer would be that we seem to be born to want hand outs not take personal responsibility for your actions and definitely not want to think for ourselves……!
B.S.
Many socialists are hard working people and all think for themselves! 
Yes people should take personal responsibility and when they can’t – WELFARE oh yeah! 
p.s.- I know what you’re going to say to that so I’m saving you the trouble
Spud what do you define as socialist? Do you go by the purist definition (Marx) or Labour’s which same may say bares similarities to Stalinism where the State tries to control everything because they always know better than the masses….
It’s slightly different for every individual
For me I like state owned stuff and private companies and welfare and people who work hard to get ahead 
re “and people who work hard to get ahead”……see you just used the same language that red supporters try & say is indicative of being a NACT plant….
Excluding Marxist theory (which usually means you believe socialism to be primary stage before the evolution of communism), the standard definition (found a basic one via wikipedia) is that socialism is an “economic and political theory based on public ownership or common ownership and cooperative management of the means of production and allocation of resources.”
@Becks – me sound like a NACT plant? I feel dirty
I guess it takes one to know the language
I like public ownership of stuff
I’m just repeating the interpretation of your friends….
Nice post Darien I think you are right saying Microeconomics can and should be more appealing to the individual but Macroeconomics can’t and shouldn’t be.
I think their interpretation is right!
@Dylan – you might have a point there about important jargon and other stuff
Not so much the jargon, that can be explained to people who don’t get it on the spot
Here’s a NZ source for the book. Unfortunately there doesn’t appear to be an ebook version available.
It’s pretty much a requirement that everyone have a general understanding of economics and how it relates to themselves, reality and society.
Only dictatorial government that you get under right-wing political parties. Not all governments are evil – some are necessary administrative aspects of society.
Re “Only dictatorial government that you get under right-wing political parties.” Tehehehehe!
If your ‘blog is indicative of the rest of the book, then I don’t think we should be holding our (collective) breath. Stanford sounds less like a Krugman-esque critique of current policy direction, and more like the god-awful The anti-economist Papers by Paul Bieleski. (Tagline: God made Economists so Weather Presenters would look good)
But I digress…
you don’t need to be an economist to know a lot about economics and anyway, it’s too important to be left to the economists.
Perhaps you and I know different economists. All the ones I know and work with (some of my best friends are economists) would wholeheartedly agree with the need for greater awareness of economic issues, and decision making processes, in the wider public arena.
…It’s also the interactions and relationships between people that make the economy go around.”
Stanford says that unfortunately, many economists don’t see the world in this way.
I’m calling Bullsh*t on this. Behavioural Economics, the field at the pointy end of micro-economics – attempting to understand why people do the things they do – has exploded massively in the last decade or two and become a real force in explaining “macroeconomic phenomena”.
[economists] use complicated, technical mumbo jumbo to make their case and claim to know what’s good for people – better than the people themselves know.
If he’s going to criticise Economics for the development of specialist language, will he do the same of the Medical profession? How about Aerospace or the Film industry? It might be mumbo-jumbo to Stanford, but it’s an easy way for those in the industry to get complex ideas across to each other in a rapid manner.
I will grant that it can be difficult to revert back to more common language sometimes, but to level this kind of challenge against a single profession, when it is widespread, is incredibly insulting.
ordinary people have valuable economic knowledge
Amen to that!
knowledge that’s usually ignored by the experts
The problem which Stanford (deliberately?) ignores is the incredible cost of gathering that information, and a general unwillingness of individuals to give it.
Take the 5-yearly Census as an example. It is, without a doubt, the single most analysed, poured over, discussed, and influential dataset in existence in New Zealand. The information it contains is a goldmine. StatsNZ is, quite justifiably, proud of the final result.
But it’s hideously expensive and faces constant resistance from a general populace unwilling to part with ‘their’ information.
“Only dictatorial government that you get under right-wing political parties.” – can you elaborate on this please?
I’m probably being a bit naive here but I would say most past and present dictatorial governments and fascist leaders have been distinctly left wing. Stalin (and the rest), Pol Pot, Hitler, Hugo Chavez, Kim Jong Il and i’m sure many more have all advocated state control and state ownership of everything from media to utilities as well as the hearts and minds of the population.
Other potential current day fascist leanings, e.g the BNP in the UK. A brief skim through BNP manifesto literature brings to light proposals for the following: “large increases in state pensions; more money for the NHS; improved worker protection; state ownership of key industries.” – a perceived right wing party with distinctly left wing policies and a pattern copied in far LEFT parties in Europe who just happen to have unpleasant views on immigration.
Disputes between fascists and socialists is a dispute between brothers.
Past and present popular left wing uprisings get their support from the less well off and those that feel disenfranchised from the rest of society.
Simon re”Disputes between fascists and socialists is a dispute between brothers.”
Hilarious. That is pure poetry despite being perhaps factually incorrect…..Stalin didn’t implement socialism, he implemented Stalinism much the same as Mao implemented Maoism…..but I definitely see your point – they went left to the extreme.
Public ownership under such regimes meant authoritarian bureaucratic control…..not quite what Marx had in mind!
In terms of NZ – Muldoon was our Stalin yet he was very much right wing….
Muldoon was about as close as you get to a dictator in a country with elections…
@Simon, I think Hugo Chavez keeps being voted in? I don’t think it is fair to put amongst that infamous list for many reasons…body count being one of them.
Perhaps General Pinochet would be a good substitute although his politics were to the right.
This probably where the left right dichotomy doesn’t work very well.
Perhaps
Pol Pot, Mao, Stalin were about replacing the entrenched power structures such as Royalty.
Hilter, Pinchot, Franco were about entrenching the existing power structures more firmly and were about ultra conservatism-nationalism..
perceived right wing party with distinctly left wing policies
Keep in mind that the left-right spectrum in NZ is tightly defined by Economic policy and outlook. The European definition is more Socially focused.
It’s the reason Winston First was viewed here as ‘centre-ist’.
@ Spud
I was never gone, Spud. Just quiet.
Would wanting to stop immigration to this country, as you do, be considered right wing and dictatorial?
Its so weird that our own political identities of Left and Right are so weak that we constantly seek datums from the US, Europe and elsewhere.
@Everyone: that’s why the Political Compass came about. The opening statement sums it up nicely:
“The old one-dimensional categories of ‘right’ and ‘left’, established for the seating arrangement of the French National Assembly of 1789, are overly simplistic for today’s complex political landscape. For example, who are the ‘conservatives’ in today’s Russia? Are they the unreconstructed Stalinists, or the reformers who have adopted the right-wing views of conservatives like Margaret Thatcher ?
On the standard left-right scale, how do you distinguish leftists like Stalin and Gandhi? It’s not sufficient to say that Stalin was simply more left than Gandhi. There are fundamental political differences between them that the old categories on their own can’t explain. Similarly, we generally describe social reactionaries as ‘right-wingers’, yet that leaves left-wing reactionaries like Robert Mugabe and Pol Pot off the hook.”
Good post Darien
At the end of the day Fabian economics is purely about ‘incremental’ gradualism towards full socialism. Whilst Marxists view Fabians as communism light’ due to this approach, in reality Fabians are the engineers of the hegelian dialectic and in this light should be viewed as ‘progressives’. Interestingly the ‘left’ of yesteryear are the ‘right’of today because of this process. Thesis meets its antithesis…to become sythesis…the newly formed synthesis then becomes a new thesis and so on and so and so on….with the ‘centre line’ between left and so called ‘right’ always moving to the left as a result. The ultimate prize is state control over every aspect of the lives of its population and the eradication of all value systems that compete with the state. It’s also interesting to see how this process has been affected in part by the introduction of Frankfurt School social agendas to the mix…but I guess a new contituency had to be obtained from somewhere.