Preface: Doctor Bob's Third Law

Summary

Not long ago a friend asked me to explain the difference between the public budget deficit and the public debt, and soon after another wanted to know if the Federal Reserve Banks were private, profit-making institutions. I was struck that intelligent and informed people with advanced university degrees would ask such basic questions.

Why, I asked myself, are many people ignorant of simple aspects of our economy? To me, a professional economist for almost fifty years, the answer to that question is simple. It is the motivation for this book. Mainstream economists have been extraordinarily successful in indoctrinating people to believe that the workings of the economy are far too complex for any but experts (i.e., the economists themselves) to understand.

The mainstream of the economics profession achieves this indoctrination by misrepresenting markets or, to be blunt, systematically marketing falsehoods (and I am tempted to use a four letter word beginning with “l”). It was not always so, and I dedicate this book to progressive economists who are not liars, be they Keynesians, Ricardians, Marxists, institutionalists or evolutionists. What we all have in common is that over the last 30 years, when the “econfakers” school of economics (see below) seized the mainstream, it expelled us all as heretics and incompetents.