I often see the phrase "understand the economy" used in political discourse. "You have to understand the economy." "You just don't understand the economy." "The economy is in trouble." etc.
It is absolutely crucial to understand that there are at least two senses in which the phrase "the economy" is used. The first sense refers to the business world, that is, the network of particular businesses in the real world: banks, industries, manufacturers, retailers, etc. etc. Understanding the particular landscape of the business world is not necessary to understand economics. The second sense refers to "economics qua economics", that is, the economy as a mental abstraction.
If someone speaks of "the health of the economy" they are probably referring to systemic problems with the economy in the abstract, e.g. price controls, government-protected cartels, etc. However, if someone says "you just don't understand the economy", they're probably referring to the business world. This is usually a condescending statement from a well-connected, yet economically ignorant, politician, such as Herman Cain.
Economists do not generally claim to understand the ins and outs of doing business in the City of London or the protocols by which the Federal Reserve Bank of New York processes gold bar orders from foreign governments. Knowledge of such high-brow considerations lies far beyond the purview of commoners. But ignorance of the inner workings of the highest echelons of the business world does not imply ignorance of economics nor does it limit the reach of the science of economics even into those spheres which dwell in Olympus, beyond the material reach of us mere mortals.
The laws of economics do not cease operating in the rarefied halls of ultimate wealth and power. That's why economics is the people's science. It is a science that places the activities of the Elites under limitations every bit as real, strict and irrevocable as the laws of physics. Look at the whole history of Pyramid-building: the Pantheon, St. Peter's Basilica, the Eiffel tower, the Liberty statue, the Saturn V rocket, and so on. It is a history of aweing the masses in order to dupe them into believing that the Elites are gods, not limited by the same laws with which us commoners are so familiar: you can't get something for nothing, money doesn't grow on trees, if you want something, you've got to pay for it, people act more in their own interest than in the interests of others, and so on.
You're right, Herman Cain - I don't understand "the economy". But I do understand economics and that's all I need to understand to know when you're blowing smoke.
Clayton -
I don't think Herman Cain is active on these forums any more, dude :\
but nice post
Good post, Clayton.
(english is not my native language, sorry for grammar.)
stop preachin to da choir broski, make a blog and spread it to the world so those hear who want to hear