The sagacious Oscar Wilde observed that a cynic is someone who knows the price of everything and the value of nothing. His definition serves equally well for most economists.
I tried to recall a more recent jibe on economists. But while I can remember the family's telephone number when I was a knee-high (it was 14 – yes , true – a rural party line), I can't remember jokes to save my life, so instead I resorted to the net.
Mistake. There were so many, it crashed the world wide web, and international investors went broke when interrupted trying to short the pork flap market in Iowa.
Economists worth their salt are a scarce commodity. This is because the two or three who actually knew their stuff and predicted the 2008 Global Financial Crisis were chased out of town by a lynch mob comprised of all the pseudo economists who'd been shown up.
Economists still abound, possibly because they're lucky. Whenever, they're feeling a bit low, all they have to do is find a downtrodden looking young Millennial couple and say, "House price inflation is fantastic for economic growth." Naturally the young couple fall about laughing, and so the economist thinks s/he's a brilliant comedian as well as a brilliant economist.
The couple are laughing because the proposition is so absurd: as renters and budding parents they know more than anyone that yet more house price inflation - for them – is a catastrophe, putting house purchase even farther out of reach. It's only "growth" for those already owning property, and even then it's questionable.
Some economists will then argue that, in such situations, it simply now makes more economic sense to rent rather than buy. But of course that's because their equation fails to factor in the more intangible – but invaluable – worth of such considerations as tenure-security and independence. It's a half-pie equation.
No one wants to beat up still more on farmers already aggrieved at what they see as unfair criticism, but it's important the siren be sounded on false equations.
For donkeys' years, the nation's been living the illusion that agriculture has largely been the golden goose. But we know more now - goslings have come home to roost. What we now know is that a whole bunch of the industry's down-sides that were slowly but surely trashing the environmental commons weren't factored into the golden goose equation.
Despite considerable recent riparian planting and fencing, and the like, if synthetic fertiliser application were to cease tomorrow, it would still take several decades for the toxic level nitrates and phosphates currently in the ground to exit sub-strata water tables. Farmers didn't know this. Just a very few in the scientific community did. But we do now.
Pre-eminent fresh water ecologist Dr Mike Joy even calculates that if all the downside effects such as long-term remedial clean-ups were truly factored into the full dairy equation, it would just about cancel out the annual earnings. Not even counting the blight on the clean green tourist brand.
The new realities also demand that the equations on our whole small-manufacturing sector be revisited. Is importing cheap, shoddy shoes that are destined for the landfill in twelve months actually an "efficiency" when all the peripherals are truly factored in - especially when local production utilises local labour and raw materials?
ANZ economist Cameron Bagrie speaking at business breakfast. Photo / file
Similarly we have the false economics of, say, importing tinned fruit - a heavy, 99 per cent water commodity transported halfway around the globe. Is that really more "efficient" than local production after costing in global long-term effects of container shipping's fossil fuel consumption?
Same for a myriad of items previously locally grown or manufactured.
Much has been made of recent so-called free trade agreements such as the fated TPP and its flawed spawn, CPTTP. There's no such thing as a free lunch, nor free trade – especially when the relevant economic equations aren't the genuine full quid.
