Science of things

Apparently, according to the laws of physics, inventing a time machine is impossible because it violates something called a casualty law; there goes my plans of making a fortune vis-à-vis time travel. Also, every time a magician levitates, he is being held up by a rope or something because the act of levitation violates momentum laws and hence the act is impossible; the world has lived a lie, there is no such thing as magic. And based on experiments conducted till now, nothing can overtake a beam of light; seriously, all these science fiction and super hero movies were also a lie?! Finally, a perpetual motion machine will never work since it violates the laws of thermodynamics; notwithstanding that one has absolutely no idea what that is and why would anyone want to build such a thing in the first place.
Reading Neil Tyson's book, which claimed to provide an easy and hurried short course on Astrophysics, picked up at a bookstore purely out of curiosity, was indeed enlightening. First of all, a realization has dawned that there is no short cut to understanding astrophysics irrespective of what Mr. Tyson might claim; one remains clueless about all the laws discussed above. Secondly, if a subject claims to be a science, then, like the power and beauty of physical laws, Mr Tyson's words, the laws of that subject should apply everywhere, whether or not you choose to believe them. Physical laws are universal, meaning that those discovered and tested on earth will apply on any other planet in the universe.
The laws, theories even, of economics, seem to apply nowhere in the real world, let alone another planet, which makes you wonder why is economics called a science in the first place!
Probably, econometrics is the basis for economics claiming to be a science; mathematical models that purport to prove theories, which like physical laws, no one, other than those who dream up such theories and models, can understand. The argument that like in other sciences, in economics there is measurement, experimentation, formulation, testing and modification of hypothesis, is a load of bull. The assumptions needed to prove economic theories, even as simple as supply and demand curve or comparative advantage, are absolutely impossible in the real world and the economic man simply does not exist. In fact if you get around to reading the efficient market theory, it appears comical if anything.
But why does it matter? If economics wants to be called a science, live and let live. Unfortunately not so simple!
When a physicist claims that there exists something called the dark matter or dark energy, a layman will probably accept it on face value irrespective that these monikers alone sound unbelievable and appear to be something out of a Star Trek movie. On the other hand, if a painter claimed that his painting was as good as Picassos, or if a music composer insisted that his symphony was superior to Beethoven, or if a columnist claimed that his writing matched Shakespeare, the most likely general response would be laughter followed by telling all three of them to take a hike to the nearest mental institution.
Accordingly, if everyone believes that economists are scientists, the normal tendency will be to defer to their opinion even when their theories look, sound and feel imbecilic. However, if they, the economists, were to be deemed artists, everyone will immediately become a critic, and at the minimum argue that a spade is a spade. And this blind faith on economists has had and continues to have serious repercussions for Pakistan's economy.
Take the free trade argument. According to economic theory, free trade is universally beneficial; that is not how it has worked for Pakistan. We diligently practised free trade and all we got was huge trade deficits which we ended up financing through external debts and there seems to be no apparent strategy to ever get out of the debt trap that we find ourselves in. Further, we seem to have exported skilled jobs and our workforce perhaps is now reduced to unskilled labour.
Foreign direct investment is great for growth; all we got was more debt and more Chinese. Invariably, even equity investments have a payback, and most managerial positions will more than likely be retained by the foreign investors. And for some reason investors in Pakistan are allergic to transfer of technology; automobile industry being the case in point.
GDP growth is the key economic indicator to determine the well-being of a nation. Well, we have been growing, less or more, for as long as one can remember and if anything, going in reverse as far as development goes. Whether we grow by 2% or 5%, all we get is more debt and less improvement in the quality of life of the masses, most of whom struggle to get clean water, sanitation and health and education services.
It is not the government's business to be in business. Then why is government guaranteeing businesses; if free markets worked or there was such a thing as an invisible hand, why should the government take all the risks and business the reward. And empirically, what have we gained by privatising except for more unemployment and outflow of profits.
In a nutshell, economists are not scientists and for my money, horrible artists. We would be better off is we stopped listening to them and relied more on common senses than on their science of things!
(The writer is a chartered accountant based in Islamabad. Email: [email protected])