Posted on 12/15/2009 7:33:16 AM PST by Captain Kirk
An announcement from the Massachusetts Institute of Technology informs us that Paul A. Samuelson died on Sunday, December 13, 2009, at the age of 94. The announcement also gives a good account of why Samuelson was for more than half a century a towering figure in the economics profession and, to some degree, in the wider world.
Although my one personal encounter with Samuelson was brief and not altogether pleasant, I was greatly affected by his influence on economics. In the 1960s, when I was being trained in economics, he was generally regarded as the greatest living economist, and his way of doing economics was generally regarded as virtually defining how to carry out economic analysis scientifically.
Having suffered through this Samuelsonian training, I immediately began to move away from it once I became an economist. In fact, I increasingly grew to believe that the worst aspects of modern economics owe more to Samuelson than to any other single economist. Eventually I became convinced that the modern mainstream’s so-called scientific economics is not truly scientific at all, but a species of scientism – the misapplication of methods developed for the study of material reality to the study of human choice and cooperation. Having had my say about Samuelson’s baneful influence in this regard (here and here), I need say nothing more upon his passing.
Except that however misguided I believe he was in his approach to economics, he was a man of enormous intellect and tremendous Except that however misguided I believe he was in his approach to economics, he was a man of enormous intellect and tremendous influence.
(Excerpt) Read more at hnn.us ...
Yet, his lies live on in his economic textbooks.
From the article cited above,
Fifteen years ago, Reason magazine invited a number of writers, including me, to contribute a brief entry for a feature called “Know Thy Enemy.” The idea was that each of us would “suggest a book published in the last 50 years that is significant because it has helped promote wrongheaded ideas with serious consequences” (December 1993, p. 32). For my contribution, I selected Samuelson’s Foundations. If I had to identify such a book today, I still could not think of a more apposite choice.
Well I have studied his textbook thoroughly. Sorry to hear he has passed. Condolences to the family.
Samuelson's mathematical theories have led to enormously complex LP models (often in excess of 5,000 variables and 5,000 constraints) which are notoriously unreliable (along the lines of hurricane prediction algorithms) but are nevertheless used extensively in establishing economy (because, alas, there is nothing better except common sense -- which is sorely lacking in government and academia).
I for one will not miss the guy. Milton Friedman on the other hand is a great loss ...
I have a phd in mathematical econonics and greatly admired his scholarly achievements.
But i HATE all democrats and the old adage “the only good democrat is a dead democrat” still applies.
Do not hold hard feelings for the man. He was a product of his time. Keynseian economics was de rigor during his matriculation. The funny thing is, even Keynes stated that once you are successful in priming a pump, you stop priming. Too bad the Roosevelt/Truman/Kennedy/Johnson et al never chose to implement that part of the theory. Keynes theory stated that you employ Govt spending to restart transactions within an economy, but you run surpluses during good times to build a stimulus fund for bad times. Keynes never addressed the inherrent flaw in his theory, that humans (particularly politicians) can never leave money unspent. Keynes theory is reasonable. Execution of his theory by socialists is unsustainable. Ultimately, Keynes is used as a code word excuse for any kind of spending.
Samuelson’s influence was enormous. Over 4 million textbooks sold. As late as 1989 Samuelson was still defending the Soviet Union stating that it was, “proof that, contrary to what many skeptics had earlier believed, a socialist command economy can function and even thrive.” We are now in the hands of the desciples of Samuelson. The recession is over. Happy days are here again. In one year Koolaid sales will skyrocket.
I have a MS in Operations Research (i.e. mathematical engineering), and an MBA in Finance and Marketing (with a thesis in OR) -- both from top 10 institutions.
I too greatly admire Mr. Samuelson's work in mathematics. Unfortunately, however, it breaks down in the real world in numerous places -- e.g. panics, herding, and most especially when setting an objective function. (I have argued for years that economists need to quit thinking in terms of "utiles" and instead focus on something more appealing such as "orgiles"). And like you, I detest socialism in all of its evil variants.
Keynesian economics is hardly reasonable in my opinion. Sometime read (or watch on YouTube) Friedman -- beginning with his rebuttal of the argument the government can spend your money more wisely than you can (or even spend it wisely at all), followed by the argument the government will pay back its debt during periods of prosperity, followed by the inevitable gains resulting from paying back debt with currency with diminished purchasing power.
Keynesian economics is unworkable in the real world because it is terribly theoretically flawed.
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