Ideas and Consequences
Good Economists, Bad Economists,
B Y L AW R E N C E W. R E E D
columnist and Nobel laureate Paul Krugman, who does
ood economists are seldom popular with the
political class.This is not unique to democratic have the audacity to call himself an economist.
systems; dictators like good economists Krugman on numerous occasions has poured his
even less. vitriol on the retail giant, whom he charges with wag-
Why? ing a “war on wages.” His diatribes were often cited a
As a rule, politics doesn’t educate. It obfuscates, pon- couple of years ago when the anti-Walmart drumbeat
tificates, and prevaricates. It often seeks to advance the reached a fever pitch in Washington and in political
interests of the few at the expense of the many. It is a campaigns around the country.
playground for the shortsighted and the demagogic.
Economics, on the other hand, tells us a great deal Big Box of Polarization
about how material life can be improved through the
operation of entrepreneurship and markets. It informs
us that there are laws beyond those that legislatures
T he Norman/Krugman critique of Walmart is little
more than an anti-capitalist rant against a company
that pays no more than it has to in order to attract the
pass, and consequences for ignoring them. workers it needs and sells its wares at prices others
The good economist takes the dis- sometimes find it difficult to compete
cussion of economic matters to the with. Not surprisingly, demagogic
lofty level it deserves. While others
Many people assume politicians have used their arguments
spout clever sound bites, unsubstanti- that bigness in in a populist crusade for government
ated charges, and snake-oil remedies, to “do something” about Walmart.
the good economist raises his hand business automatically Perhaps it was inevitable that the
and calmly declares, “Wait a minute! implies a woeful trail one company virtually all of us have
Let’s look at the facts. Let’s separate patronized would become a political
the wheat (truth, logic, and evidence) of victims. football. Any firm that makes its way
from the chaff (nonsense, false to the top spot on the Fortune 500