TILT AT ECONOMISTS

Taranaki Daily News, 22 March 1935, Page 3

TILT AT ECONOMISTS

MERITS OF NATIONALISM IDEAS BASED ONLY ON THEORY. VIEWS OF ENGLISH MR “How many British text-book economists realised after the war that intensified nationalism, applauded as 'self-de-termination’ and ‘the rights of small nationalities,’ must express itself by efforts at economic self-sufficiency, tariffs, quotas, blocked exchanges, and government intervention in the mechanisms of commerce?” writes Sir' Arthur Michael Samuel, Bt., M.P. (formerly Financial Secretary to the Treasury, previously Minister for Overseas Trade), in the Sheffield Daily Telegraph. “When these tendencies took concrete shape the economists, instead of seeking to understand them, looked on them as temporary insanities and harangued Europe on its wicked inability to perceive the wisdom of lowering trade barriers. They had to be taught how the march of science, as well as the particularist tendency of humanity, is reducing the need for international trade,” adds Sir A. M. Samuel, in the Sheffield Daily Telegraph.' . “Each country can now make its own nitrates from the air overhead instead of bringing them from Chile. The same will become true of several other commodities as the years pass, yet the economists assume that foreign trade is the chief branch of trade for .progressive nations and must continue to grow. “Even in their studies of the home market economists teach the law of supply and demand as though that law still always operated freely between individual sellers and buyers. “They ignore the intervention of cartels and combines, price fixing associations, retailers’ associations, restrictions of production and output, and other interferences with the normal play of the natural law which adjusts supply and demand, production and consumption, towards healthy equilibrium. i ? “The turbot has both its eyes on one side of its head and looks at things from one side only. That is much the way the theoretical economists and the professors look at commerce. They imagine markets based on ideal non-existent conditions. Or they concern themselves with completed action, and device ‘plans’ for distributing existing wealth. ‘Planning’ is a magic word with some. “You cannot build a successful export trade on that or run an export business like an automatic lathe. 'You must have the experience of having been abroad, and of having for long periods watched your market and your distributor, and seen the type of person who is likely to buy from your distribute!. “Personal • on-the-spot-experience’ in markets is more helpful than theories of economists, fixed by them in the past when the conditions of to-day were unforeseen. “I seldom read of a professional economist showing us how to start successfully a new trade or business, or how to’ increase the profits of an old one. In this world, where the greatest prizes are given for initiative, we require to be taught how to start new and profitable enterprises. “Post-mortems, though necessary, can be overdone. Let the economists now admit that economics is not an exact science with exact laws, and that industrial and financial events, commercial successes and failures are not always due to causes purely .economic. “Human factors which are variable and often incalculable affect both the phenomena and the results which are the subjects of economic study. Let them admit that economics is concerned with tend- . encies which have different results in different countries, and are neutralised by altered circumstances, prejudices and temperaments. “Let economists begin with fresh minds a detailed analysis of actual trade transactions now in progress in the overseas market places.”