Economists From The United States

"There is no economic policy. That's really important to say. The general of the Bushies is that they don't make policies to deal with problems. They use problems to justify things they wanted to do anyway. So there is no policy to deal with the lack of jobs. There really isn't even a policy to deal with terrorism. It's all about how can we spin what's happening out there to do what we want to do."

"The whole subject of the liquidity trap has a sort of Alice-through-the-looking glass quality. Virtues like , or a known to be strongly committed to , become vices; to get out of the trap a country must loosen its belt, persuade its citizens to forget about the future, and convince the that the government and central bank aren’t as serious and austere as they seem."

"So you can take your pick as to which Mundell you prefer; but the Nobel committee basically honored Mundell the younger, the economist who was iconoclastic enough to imagine that Canada, of all places, was the economy of the future--and was right."

"The serious lesson of the antics in Argentina, then, is that the big issues of --fixed vs. flexible exchange rates, whether countries should have independent currencies at all--are still wide open. It's an eternal controversy, and not even the pope can resolve it."

"The hangover theory, then, turns out to be intellectually incoherent; nobody has managed to explain why bad investments in the past require the unemployment of good workers in the present. Yet the theory has powerful emotional appeal. Usually that appeal is strongest for conservatives, who can't stand the thought that positive action by governments (let alone—horrors!—printing money) can ever be a good idea. Some libertarians extol the Austrian theory, not because they have really thought that theory through, but because they feel the need for some prestigious alternative to the perceived statist implications of Keynesianism. And some people probably are attracted to Austrianism because they imagine that it devalues the intellectual pretensions of economics professors. But moderates and liberals are not immune to the theory's seductive charms—especially when it gives them a chance to lecture others on their failings."

"In short, the success of macroeconomic activism, in both theory and practice, has made it possible for free market microeconomics to survive--again both in theory and in practice."

"Here, then, is a revised version of Marshall's rules: (1) Figure out what you think about an issue, working back and forth among verbal intuition, evidence, and as much math as you need. (2) Stay with it till you are done. (3) Publish the intuition, the math, and the evidence - all three - in an economics journal. (4) But also try to find a way of expressing the idea without the formal apparatus. (5) If you can, publish that where it can do the world some good."

"So the story of the baby-sitting co-op is not a mere amusement. If people would only take it seriously—if they could only understand that when great economic issues are at stake, whimsical parables are not a waste of time but the key to enlightenment—it is a story that could save the world."

"By 2005 or so, it will become clear that the Internet's impact on the economy has been no greater than the fax machine's."

"There is nothing that plays worse in our culture than seeming to be the stodgy defender of old ideas, no matter how true those ideas may be. Luckily, at this point the orthodoxy of the academic economists is very much a minority position among intellectuals in general; one can seem to be a courageous maverick, boldly challenging the powers that be, by reciting the contents of a standard textbook. It has worked for me!"

"The idea of comparative advantage—with its implication that trade between two nations normally raises the real incomes of both—is, like evolution via natural selection, a concept that seems simple and compelling to those who understand it. Yet anyone who becomes involved in discussions of beyond the narrow circle of academic economists quickly realizes that it must be, in some sense, a very difficult concept indeed."

"It is a bit funny, but also quite sad: Those who preach the doctrine of global glut are tilting at windmills, when there are some real monsters out there that need slaying."

"If economists ruled the world, there would be no need for a World Trade Organization. The economist's case for free trade is essentially a unilateral case—that is, it says that a country serves its own interests by pursuing free trade regardless of what other countries may do."

"If you want a simple model for predicting the unemployment rate in the United States over the next few years, here it is: It will be what Greenspan wants it to be, plus or minus a random error reflecting the fact that he is not quite God."

"But the honest truth is that what drives me as an economist is that economics is fun. I think I understand why so many people think that economics is a boring subject, but they are wrong. On the contrary, there is hardly anything I know that is as exciting as finding that the great events that move history, the forces that determine the destiny of empires and the fate of kings, can sometimes be explained, predicted, or even controlled by a few symbols on a printed page. We all want power, we all want success, but the ultimate reward is the simple joy of understanding."

"I do not mean to say that formal economic analysis is worthless, and that anybody's opinion on economic matters is as good as anyone else's. On the contrary! I am a strong believer in the importance of models, which are to our minds what spear-throwers were to stone age arms: they greatly extend the power and range of our insight. In particular, I have no sympathy for those people who criticize the unrealistic simplifications of model-builders, and imagine that they achieve greater sophistication by avoiding stating their assumptions clearly. The point is to realize that economic models are metaphors, not truth. By all means express your thoughts in models, as pretty as possible (more on that below). But always remember that you may have gotten the metaphor wrong, and that someone else with a different metaphor may be seeing something that you are missing."

"In the course of describing my formative moment in 1978, I have already implicitly given my four basic rules for research. Let me now state them explicitly, then explain. Here are the rules:1. Listen to the Gentiles 2. Question the question 3. Dare to be silly 4. Simplify, simplify"

"If there is one single area of economics in which path dependence is unmistakable, it is in economic geography – the location of production in space."

"If there were an Economist's Creed, it would surely contain the affirmations 'I understand the Principle of Comparative Advantage' and 'I advocate Free Trade'"

"Top management as a function and as a structure was first developed by Georg von Siemens (1839-1901) in Germany between 1870 and 1880, when he designed and built the Deutsche Bank and made it, within a very few years, into continental Europe's leading and most dynamic financial institution."

"The publication of Peter F. Drucker's The Practice of Management in 1954 was a turning point in the development of the discipline of management."

"What fascinated me about Drucker, and still does, is how he infuses his broad perspective on business issues with philosophical and historical considerations."

"Although he reputedly hated the label of ‘guru’, Peter Drucker was, by any standards, the greatest management guru the world has yet seen. In 1996, the McKinsey Quarterly journal described him as ‘the one guru to whom other gurus kowtow’ and Robert Heller described him as ‘the greatest man in the history of management’, praise indeed for a man who described himself as ‘just an old journalist’."

"Culture eats strategy for breakfast."

"I would hope that American managers - indeed, managers worldwide - continue to appreciate what I have been saying almost from day one: that management is so much more than exercising rank and privilege, that it is much more than "making deals." Management affects people and their lives."

"I think the growth industry of the future in this country and the world will soon be the continuing education of adults. ...I think the educated person of the future is somebody who realizes the need to continue to learn. That is the new definition and it is going to change the world we live in and work in."

"This society in which knowledge workers dominate is in danger of a new "class conflict" between the large minority of knowledge workers and the majority of workers who will make their livings through traditional ways, either by manual work... or by service work. The productivity of knowledge work - still abysmally low - will predictably become the economic challenge of the knowledge society. On it will depend the ability of the knowledge society to give decent incomes, and with them dignity and status, to non knowledge people."

"Increasingly, politics is not about "who gets what, when, how" but about values, each of them considered to be absolute. Politics is about "the right to life"...It is about the environment. It is about gaining equality for groups alleged to be oppressed...None of these issues is economic. All are fundamentally moral."

"The newly emerging dominant group is "knowledge workers." The very term was unknown forty years ago. (I coined it in a 1959 book, Landmarks of Tomorrow.) By the end of this century knowledge workers will make up a third or more of the work force in the United States--as large a proportion as manufacturing workers ever made up, except in wartime. The majority of them will be paid at least as well as, or better than, manufacturing workers ever were. And the new jobs offer much greater opportunities."

"In the 1950s, industrial workers had become the largest single group in every developed country, and unionized industrial workers in mass-production industry (which was then dominant everywhere) had attained upper-middle-class income levels. They had extensive job security, pensions, long paid vacations, and comprehensive unemployment insurance or "lifetime employment." Above all, they had achieved political power... Thirty-five years later, in 1990, industrial workers and their unions were in retreat. They had become marginal in numbers. Whereas industrial workers who make or move things had accounted for two fifths of the American work force in the 1950s, they accounted for less than one fifth in the early 1990s--that is, for no more than they had accounted for in 1900, when their meteoric rise began... By the year 2000 or 2010, in every developed free-market country, industrial workers will account for no more than an eighth of the work force. Union power has been declining just as fast... By the year 2000 or 2010, in every developed free-market country, industrial workers will account for no more than an eighth of the work force. Union power has been declining just as fast."

"That knowledge has become the resource, rather than a resource, is what makes our society "post-capitalist."

"The postwar [WWII] GI Bill of Rights - and the enthusiastic response to it on the part of America's veterans - signaled the shift to the knowledge society. Future historians may consider it the most important event of the twentieth century. We are clearly in the midst of this transformation; indeed, if history is any guide, it will not be completed until 2010 or 2020. But already it has changed the political, economic and moral landscape of the world."

"Never underrate the boss! The boss may look illiterate. He may look stupid. But there is no risk at all in overrating a boss. If you underrate him he will bitterly resent it or impute to you the deficiency in brains and knowledge you imputed to him."

"Keep the boss aware. Bosses, after all, are held responsible by their own bosses for the performance of their subordinates. They must be able to say: "I know what Anne [or John] is trying to do.""

"A manager's task is to make the strengths of people effective and their weakness irrelevant - and that applies fully as much to the manager's boss as it applies to the manager's subordinates"

"The subordinate's job is not to reform or reeducate the boss, not to make him conform to what the business schools or the management book say bosses should be like. It is to enable a particular boss to perform as a unique individual."

"Once a year ask the boss, "What do I or my people do that helps you to do your job?" and "What do I or my people do that hampers you?""

"This new knowledge economy will rely heavily on knowledge workers. ...the most striking growth will be in “knowledge technologists:” computer technicians, software designers, analysts in clinical labs, manufacturing technologists, paralegals. ...They are not, as a rule, much better paid than traditional skilled workers, but they see themselves as “professionals.” Just as unskilled manual workers in manufacturing were the dominant social and political force in the 20th century, knowledge technologists are likely to become the dominant social—-and perhaps also political—-force over the next decades."

"...the information revolution. Almost everybody is sure ...that it is proceeding with unprecedented speed; and ...that its effects will be more radical than anything that has gone before. Wrong, and wrong again. Both in its speed and its impact, the information revolution uncannily resembles its two predecessors ...The first industrial revolution, triggered by James Watt's improved steam engine in the mid-1770s...did not produce many social and economic changes until the invention of the railroad in 1829 ...Similarly, the invention of the computer in the mid-1940s, ...it was not until 40 years later, with the spread of the Internet in the 1990s, that the information revolution began to bring about big economic and social changes. ...the same emergence of the “super-rich” of their day, characterized both the first and the second industrial revolutions. ...These parallels are close and striking enough to make it almost certain that, as in the earlier industrial revolutions, the main effects of the information revolution on the next society still lie ahead."

"Knowing Yourself ...We also seldom know what gifts we are not endowed with. We will have to learn where we belong, what we have to learn to get the full benefit from our strengths, where our weaknesses lie, what our values are. We also have to know ourselves temperamentally: "Do I work well with people, or am I a loner? What am I committed to? And what is my contribution?""

"...all earlier pluralist societies destroyed themselves because no one took care of the common good. They abounded in communities but could not sustain community, let alone create it."

"...human beings need community. If there are no communities available for constructive ends, there will be destructive, murderous communities... Only the social sector, that is, the nongovernmental, nonprofit organization, can create what we now need, communities for citizens... What the dawning 21st century needs above all is equally explosive growth of the nonprofit social sector in building communities in the newly dominant social environment, the city."

"Universities won't survive. The future is outside the traditional campus, outside the traditional classroom. Distance learning is coming on fast."

"Thirty years from now the big university campuses will be relics. Universities won't survive. It's as large a change as when we first got the printed book. Do you realize that the cost of higher education has risen as fast as the cost of health care? And for the middle-class family, college education for their children is as much of a necessity as is medical care—without it the kids have no future. Such totally uncontrollable expenditures, without any visible improvement in either the content or the quality of education, means that the system is rapidly becoming untenable. Higher education is in deep crisis."

"...what's absolutely unforgivable is the financial benefit top management people get for laying off people. There is no excuse for it. No justification. This is morally and socially unforgivable, and we will pay a heavy price for it."

"That people even in well paid jobs choose ever earlier retirement is a severe indictment of our organizations -- not just business, but government service, the universities. These people don't find their jobs interesting."

"For the social ecologist language is not "communication." It is not just "message." It is substance. It is the cement that holds humanity together. It creates community and communication. ...Social ecologists need not be "great" writers; but they have to be respectful writers, caring writers."

"Sören Kierkegaard has another answer: human existence is possible as existence not in despair, as existence not in tragedy; it is possible as existence in faith... Faith is the belief that in God the impossible is possible, that in Him time and eternity are one, that both life and death are meaningful."

"One of the great movements in my lifetime among educated people is the need to commit themselves to action. Most people are not satisfied with giving money; we also feel we need to work. That is why there is an enormous surge in the number of unpaid staff, volunteers. The needs are not going to go away. Business is not going to take up the slack, and government cannot."

"There is every indication that the period ahead will be an innovative one, one of rapid change in technology, society, economy, and institutions."