Aug 18, 2009

Us, Economists

A friend of mine sent me an e-mail filled with economist jokes. Some of them are hard to explain to someone who has no knowledge of economics (okay, most of them) and some are shamelessly taken from the lawyer-bunch (two of them). One of them is "Why sharks don't attack economists? Professional courtesy". I was wondering why would anyone say such a thing about us, and then I remembered that there's "us" and there's the "libertarian", the "liberal" and the "Chicago Boys" bunch. To say that I dislike them is a HUGE understatement. Anyone who thinks that everything can be solved by the market should be put to sleep, like a rabid dog, or a mad cow.

Here we have this nice Crisis. Guess what? The oh-so-free market was the one that pushed us there. All the brainless Chicago boys, the Milton-Friendman wannabes, the "free market, so that the PERFECT COMPETITION can prevail" major imbeciles, that really, how did they even got their degree?, they all pushed and cheered and lobbied for THIS. Because the Government internvention only creates chaos. These are the ones who told people that "private social care" is better, and while in a small country like Costa Rica someone who's sick can go to the local hospital and be cured, in the U.S. with all their money they can't be sure if they can AFFORD medical attention. But hey, free market makes it better.

So, back to the Crisis, we have all these enterprises that ran the stockmarkets and broker houses and especulated about the future, and bought, and sold and made a whole lot of money over the nothing. They let their suppositions blow up a bubble and didn't care to take precautions, but went in for the money, in for the money until it couldn't hold it up and it came crumbling down. But who crumbled down? The little people.We all saw it, didn't we? Suddenly, when things went pearshaped, it was EXPECTED that the State, the Government bailed them out of the hole they had get themselves into. In an "effort" to reduce costs and become lean and good, they started laying off people, reducing work times, moving people in full time jobs to part time jobs, and then, what was the first thing they did with the bailout money? Pay those huge slices of "executive pays".

So let me see if I get this correctly: the market is good and keeps everything in balance and brings everything to its best possible state, and all the Government does is spoil things and make them inefficient, BUT when the free market collides because no theory any neoclasical, neoliberal or Chicago-Dumb can think of has the core element of all markets, CORRUPTION and UNFAIR PLAY, THEN the Goverment MUST bail them out, but not the entire market, only that upper layer of exceedingly paid pigs, and then, when they get their money and are safe in Liechtenstein or Rio, then you leave the market to save itself, make jobs and all going back to the way it was.

Wanna see some fun things? These big-paycheck executives often sign very protective contracts, where they are secured big bucks (like in the Hall story), so even if the enterprise goes down (like Citi), they'll be paid the big bucks (like Hall), because "it's in the contract". Doesn't that tell you something about the "free market" and the trust in the "invisible hand"? It does to me.

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