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  • Mon, 13, Jul, 2015 - 5:00:AM

Why should we give a shit about economics?

Back in the old days, I would read the newspaper occasionally. My parents would buy all of the weekend papers and I was one of those weird teenagers that actually picked up the odd section and leafed through it. The one section I never touched? Business. I remember looking at it lying open on the table one day. Graphs, boring pictures of men in suits, and lots of numbers. Yawn. Pass me the Sunday please.

One semester many years later I needed to sit a 100-level elective paper. The options were pretty limited for that particular term so when I stumbled upon a paper called Politics and Public Policy in New Zealand I thought, ‘oh yeah, I’m interested in politics, that’ll do’. A few weeks later I sat down to read my course materials. The terms ‘neoclassical’ and ‘Keynesian’ stared back at me. Economics. What had I done?

My aversion to economics likely had its roots in my extreme distaste for maths. Simply put, numbers are not my thing. The idea of spending a whole semester learning about numbers was enough to make me want to cry, but it was too late to do anything about it, so I made the tough choice to suck it up.

The first few weeks were painful. When you have obstinately refused to engage with anything vaguely numerical since you were last forced to sit a maths exam in year 12, studying economics requires a bit of a mind-set overhaul. And a lot of chocolate. Then, around week 4, the entirely unexpected happened: not only did I actually start to enjoy it, I had a sudden realisation of how much of an impact economics was having on my life without me even knowing it.

I began to see the world around me in a very different light. Simple things that I’d hardly given a second thought to: how much we pay when we go to the doctor, the price of electricity, the price of milk, the way my credit card worked, the ‘right’ to receive a pension, the amount set as a minimum wage. The influence of economics is all around us, whether we think about it or not.

But we really should think about it. When we don’t, the small group of people who do think about it (bankers, financiers, big business, governments, etc) are left to their own devices. And it doesn’t take a psychologist to explain that, especially when large amounts of money are at stake, powerful groups will generally act in their own self-interest.

And that had worked out quite nicely for a number of powerful people. The terms ‘free market’, ‘free trade’ and the general ‘freeing up’ (deregulation) of economies were hailed as measures that were good for us all. Any other way of doing things was bad and eventually we all believed that there was only one way to ‘do’ economics, that free market capitalism was the only economic system (aside from that crazy communism experiment that happened before we were born). The rich got richer. The ‘trickle down’ effect was meant to help us all. Things were good. Right up until 2008.

The Global Financial Crisis was perhaps the best (worst) imaginable indication that the system was not working the way it was meant to. During the crisis, unbelievable though it may seem, the rich generally still got richer, while the poor got even poorer. Economies around the world are still trying to recover from the shock of the ‘Great Recession’ today.

But why should we give a shit? In a nutshell:

- Because we can’t fix what we don’t understand.

- We can’t win if we don’t know the rules of the game.

- We can’t make sure everyone gets a fair go if we don’t know how to change the rules.

- We can’t prevent disaster if we don’t know what to look out for.

Millennials are one of the only generations in living memory to have grown up or ‘come of age’ during a major recession. In a world that is still struggling to recover, with economies still on the brink (I’m looking at you, Greece, but with one eye on China), and inequality on the rise as wealth sits in a glut in the pockets of the very few, it seems crazy to leave economics solely in the hands of the people who got us into this mess.

And yet we do. Two years ago, I knew nothing about economics. But I knew that I was seeing widespread suffering, I knew it was wrong, and I didn’t need a piece of paper to tell me that. As Cambridge University’s Ha-Joon Chang explains, “I don’t have a degree in international relations but I have a view on Afghanistan. How come everyone thinks that economics is too difficult, too technical? …We economists have been very successful in convincing people that what we do is very difficult and that people won’t understand it even if we explained it to them. There has also been a lot of political interest in keeping economics away from democratic debate, keeping it away from the general public by making people believe that it is very difficult.”

So why should we give a shit about economics? Because it affects us every single day. It has the power to make us rich, to send us spiralling into poverty, to reward the lucky few at the expense of the masses… it even has the power to send the world to war.

Ready to start giving a shit about economics? Here are a few great places to start:

- This introductory video.

- This site that shows the scope of our national and international debt.

- This book (reviewed here by the Guardian).

- This video on the Global Financial Crisis.

- Ted’s talks on economics.

TAGGED IN

  • Economics /
  • Newspapers /
  • Business /
  • Finance /
  • Maths /
  • Numbers /
  • Society /
  • Power /
  • Free Market /
  • Neoclassical Economics /
  • Keynesian Economics /
  • University /
  • Minimum Wage /
  • Credit /
  • Global Financial Crisis /
  • Millennials /
  • Wealth /
  • Rich /
  • Poor /
  • Poverty /
  • Education /
  • War /
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