Check Out:

Economix explains
Social Security

Economix explains the
Trans-Pacific Partnership

Economix explains
Net Neutrality

Economix explains

Economix: How and Why Our Economy Works (and Doesn't Work), in Words and PicturesWhat is Economix?

Economix is a graphic novel by Michael Goodwin, illustrated by Dan E. Burr, that explains the economy. More than a cartoon version of a textbook, Economix gives the whole story of the economy, from the rise of capitalism to Occupy Wall Street. Economix is published by Abrams Comic Arts.

Praise for Economix

“I just cannot stress enough how amazing this book is.”
–James Floyd Kelly, Wired.com

“It’s simply phenomenal.”
– David Bach, author of Debt Free for Life and The Automatic Millionaire

“Goodwin has done the seemingly impossible–he has made economics comprehensible and funny.”
– Joel Bakan, author of The Corporation: The Pathological Pursuit of Profit and Power

“An amazing lesson in true-world economics! Delightfully presented, powerful, insightful, and important information. What a fun way to fathom a deep and often dark subject”
– John Perkins, author of Hoodwinked and the New York Times bestseller Confessions of an Economic Hit Man

Economix is a lively, cheerfully opinionated romp through the historical and intellectual foundations of our current economy and our current economic problems. Goodwin has a knack for distilling complex ideas and events in ways that invite the reader to follow the big picture without losing track of what actually happened. Any reader wondering how our economy got to where it is today will find this a refreshing overview.”
– Timothy W. Guinnane, Philip Golden Bartlett Professor of Economic History, Yale University

More praise for Economix

Author’s Blog


So, the Greek referendum is today. Here’s hoping that it forces some progress in the endless madness that is the Greek crisis. Because so far the Troika has simply been demanding the same things, in the same terms, for years. Is it even a “crisis” when nothing changes for that long?

Seriously, check out what I wrote about Greece in Economix, keeping in mind that the text was finished in mid-2011. I would write the same thing word for word today.Greece1Greece2Greece3



That’s been the situation for the last four years and more. But maybe not tomorrow.



EDIT, 7/5/2015: When I wrote this I was confused by the holiday and thought it was already Sunday. Derp.



A (poorly thought through) prediction about the Larsen B ice shelf

WARNING: See edit below.

So, NASA is now predicting that the remnants of the Larsen B ice shelf will be gone by the end of the decade.

I’m going to make my own prediction, just so I’m on the record: It’ll happen faster than that. This coming summer (the Antarctic summer, so Winter 2015-2016 here) or the summer after.

No, I have no access to climate data that NASA doesn’t have. And I don’t read the data better than climate scientists do, or at all. But I’m still pretty confident.

That’s because, in a weird way, the right wing is correct: Climate scientists are always wrong.

They’re wrong because they start from the assumption that nothing will change. Then they look at the data and report upcoming changes that they can prove. The researchers have no real choice in this; anything less rigorous would leave them open to a slew of well-funded attacks from deniers.

So, for instance, nobody knows what the impact of methane release from melting permafrost will be. Climate models therefore don’t take it into account, because any value they gave it would be a guess. But giving it a value of zero is also a guess, and almost certainly a worse guess than any positive value they would have given it.

And so again and again, what scientists can prove at any given time is overtaken by events soon after.

So if climate scientists say the Larsen B shelf will be gone in five years, I’m pretty sure it’ll be quicker than that.

Let’s hope I’m wrong.

EDIT: Reader Fabius Maximus has pointed me to several cases in which reality has not been as bad as climate scientists have predicted. I’m not sure why I hadn’t come across these–it may have been my personal bad-news bias, or the fact that “problems worse than scientists predicted” makes a better headline than “problems in the low end of the predicted range.”  So, my bad.

The lesson here, kids, is don’t listen to nonscientists about the freaking climate.

Greg Mankiw Is Everything That’s Wrong With Economics

So anyone who read my rant about N. Gregory Mankiw’s atrocious textbook knows I’m not a big fan. Now comes Mankiw’s recent op-ed in the Times supporting the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership: “Economists Actually Agree on This: The Wisdom of Free Trade.”

It reminded me of another piece: Sylvia Nasar’s column supporting NAFTA in the very same paper, 23 years ago: “A Primer: Why Economists Favor Free-Trade Agreements.

Here’s the first line of Nasar’s article:

When economists of every stripe agree on anything, it is noteworthy. 

So economists were unanimously for free trade 23 years ago, and they’re unanimously for it now. Free trade is therefore good. Q.E.D., right?

Well, it’s worth reminding ourselves why economists were for NAFTA back than. Nasar wasn’t arguing that NAFTA would be great for the US; rather, she was saying that the effect on the US would be minor, while it would be great for Mexico (and that a prosperous Mexico was in the US’s interest).

So what happened? Mexico’s wages have stagnated to the point that Mexican wages are now lower than Chinese ones. And politically, rather than a prosperous neighbor, we have a country that has teetered on the edge of becoming a failed state.

And while one could argue that it’s not NAFTA’s fault, one would be wrong. NAFTA actually does deserve a lot of the blame here.

So how can economists, after 23 years’ worth of evidence that they were wrong, have learned nothing? How can they still agree that NAFTA-style “free trade” agreements (which is what the TPP and TTIP are) are simply good?

Well, part of the answer is that Mankiw is lying. Some economists have learned from their mistakes. The consensus is not nearly as strong as it was in the 1990s, when the only debate was between economists who thought that trade agreements were flat-out good and those who acknowledged that they might not be good for every person unless the winners compensated the losers out of their winnings.

But the rest of the answer is that Mankiw is a poster boy of what’s wrong with too many economists (perhaps in part because so many economists start with his atrocious textbook): he sees the world as a set of postulates and theorems, and he sees no reason to abandon that approach just because facts don’t agree. So when he says

The main issue is not the number of jobs, but which jobs.

That’s because to him, it’s just axiomatic that our policies can’t affect the number of jobs (scroll down to “The Broken Window Fallacy Fallacy” here if you want to see why I disagree).

Then it gets worse. Far, far worse. The second part of Mankiw’s article, and seemingly the real point, speculates on why we, the voters, just won’t listen to economists on trade.

Here’s Mankiw:

If economists are so sure about the benefits of free trade, why are the public and their elected representatives often skeptical?

Is his answer: “Because economists have been sure and wrong before, and a rational person can doubt whether the same justifications that have proven wrong in the past are correct today?”

No! Check this out:

One answer comes from a 2007 book by Bryan Caplan, a George Mason University professor, called “The Myth of the Rational Voter: Why Democracies Choose Bad Policies.”

Mr. Caplan argues that voters are worse than ignorant about the principles of good policy. Ignorance would be random and might average out in a large population. Instead of being merely ignorant, voters hold on to mistaken beliefs.

Politicians, whose main goal is to get elected, mold those mistaken beliefs into bad policy. Mr. Caplan writes: “What happens if fully rational politicians compete for the support of irrational voters — specifically, voters with irrational beliefs about the effects of various policies? It is a recipe for mendacity.”

If you’ve finished laughing about “fully rational politicians” let’s — you haven’t? I’ll wait. . . .

Okay, take a minute to read it again. Read Mankiw’s smug condescension: you stupid voters just don’t understand. Only he understands.

Mankiw is giving what are basically the core beliefs of the econ profession:

  • Economists have sophisticated, logical, mathematical models of the economy that non-economists don’t understand.
  • These models let economists see through the noise of the real world to underlying truth.
  • Nowhere is the difference between economists’ true perceptions, and the fuzzy thinking of everyone else, clearer than with trade.

Thing is, only the first point is true. Economists’ models are certainly opaque to the rest of us, but they have a truly atrocious track record, and most economists simply don’t care. No other field, except perhaps astrology, fetishizes its methods to the exclusion of its results; no other field looks down on people who check to see what happens in the real world.

So when Mankiw says this:

Instead of being merely ignorant, voters hold on to mistaken beliefs.

He’s describing himself, not voters. Mankiw, not voters, is “worse than ignorant about the principles of good policy.”

And yet he thinks we should have *less* of a voice in our own government.

How the fuck does this guy get to keep his chair at Harvard?

Quote of the day: Demosthenes

“I observe that, although the speeches on our side are always manifestly just and sympathetic, and . . . are always regarded as saying what ought to be said, yet practically nothing is done which ought to be done, or which would make it worth while to listen to such speeches.” —Demosthenes, Second Philippic, ~344 BC

Apropos of nothing, of course.

Chinese translation!

Economix is out in Taiwan!

Comic Economics, Understand at a Glance” is the Chinese title, and check out the new funky cover!

Taiwanese jacket cut

The translator (Li Jianxing, or probably Lee Chien-hsing in Taiwan) clearly kept things simple and direct–there are long passages that I, with my rusty Chinese, can totally understand.

Of course, “rusty” is a kind term–there are also many passages that I can’t read even though I know what it says. . . .



Read more on the Blog!