The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
Booms and Busts
Short two-to-three-minute videos on the causes of booms and busts:
The history of booms and busts: http://www.learnliberty.org/content/history-economic-booms-and-busts
The Myths of the Great Depression: http://www.learnliberty.org/content/top-3-myths-about-great-depression-and-new-deal
Govt. response to the 2008/09 Financial Crisis: Manipulation fails. http://www.learnliberty.org/content/2008-financial-crisis-government-response
Occupy Wall Street
I sympathize with the Occupy Wall Street protestors in their grievances against crony capitalism, government corruption and corporate welfare. Unfortunately, many of these protestors do not understand economic principles. More government intervention doesn’t solve problems caused by government control and interference in the free exchanges between individuals under a rule of law.
A short video on Occupy Wall Street Protestors: http://www.learnliberty.org/videos/occupy-wall-street-capitalism-professors-response
Ludwig von Mises on the First ‘Occupy Wall Street’
In his book Bureaucracy
, Ludwig von Mises discussed the German youth movement that occurred in Germany the decade before the First World War. The similarity with OWS is quite remarkable:
In the decade preceding the First World War Germany, the country most advanced on the path toward bureaucratic regimentation, witnessed the appearance of a phenomenon hitherto unheard of: the youth movement. Turbulent gangs of untidy boys and girls roamed the country, making much noise and shirking their school lessons. In bombastic words they announced the gospel of a golden age. All preceding generations, they emphasized, were simply idiotic; their incapacity has converted the earth into a hell. But the rising generation is no longer willing to endure gerontocracy, the supremacy of impotent and imbecile senility. Henceforth the brilliant youths will rule. They will destroy everything that is old and useless, they will reject all that was dear to their parents, they will substitute new real and substantial values and ideologies for the antiquated and false ones of capitalist and bourgeois civilization, and they will build a new society of giants and supermen.
The inflated verbiage of these adolescents was only a poor disguise for their lack of any ideas and of any definite program. They had nothing to say but this: We are young and therefore chosen; we are ingenious because we are young; we are the carriers of the future; we are the deadly foes of the rotten bourgeois and Philistines. And if somebody was not afraid to ask them what their plans were, they knew only one answer: Our leaders will solve all problems.
It has always been the task of the new generation to provoke changes. But the characteristic feature of the youth movement was that they had neither new ideas nor plans. They called their action the youth movement precisely because they lacked any program which they could use to give a name to their endeavors. In fact they espoused entirely the program of their parents. They did not oppose the trend toward government omnipotence and bureaucratization. Their revolutionary radicalism was nothing but the impudence of the years between boyhood and manhood; it was a phenomenon of a protracted puberty. It was void of any ideological content.
If you want a concise, clear lesson on economics you can view the 3-hour video: 10 lectures on each chapter of Economics in One Lesson by Henry Hazlitt
The book in pdf: http://www.fee.org/pdf/books/Economics_in_one_lesson.pdf
To grasp why understanding economics is critical view the errors of Prof. Milton Friedman on the Federal Reserve. Professor Friedman praised Alan Greenspan’s reign at the Federal Reserve while completely ignoring the distortions in the economy in 2005.
Milton Friedman on Charlie Rose: http://video.google.com/videoplay?docid=-2963837673813979186#
How a bad economic theory leads to a false interpretation of economic performance. An Austrian discusses Milton Friedman’s monetary theory: http://www.youtube.com/user/misesmedia#p/u/5/DMR-r0nrk60
The Importance of Critical Thinking
If you understand the lessons from Economics in One Lesson, you will see many false premises and the errors in logic here:
Thomas Friedman, the columnist for the New York Times is daft. How can innovation in one part of his essay cause human suffering while in another paragraph innovation will improve lives?