Why Economists Are Jackasses


Reckoning from Baltimore, Maryland

The great storm continues to soak us, buffet us, and find the leaks in our souls. Yesterday, there were almost no cars on the roads… only a few people in the office…and only a few restaurants still open.

‘You better make sure you have provisions stocked up,’ said a nice man on the TV. Because there are almost certain to be power outages… and given the size of this storm, it could be days… or even weeks… before power is restored.

We stopped by the liquor store on the way home. A group of four women were seated at the table in the centre of the store. Otherwise, the store was empty. The streets were empty, too.

‘Hey, a customer!’ one said.

‘Good to see you,’ said another…‘We’ve decided to drink our way through the storm. Wanna join us?’

We bought a case of wine. Better safe than sorry.

Yes, dear reader, this is a storm of Biblical proportions. According to the TV reporters, not since the days of Noah has so much rain fallen. If the water rises to the Mount Vernon area of Baltimore, we will have to look for an Ark…

But you have probably heard enough about the great storm. And you’re probably wondering what we had in mind. Yesterday, we promised to tell you why economists and policy makers were jackasses. We can’t remember what we intended, but this blank is easy to fill in.

Let’s begin by looking at an economic disaster area: Greece. It has a per-capita GDP of about $29,000 compared to nearly twice as much for the US. One out of four Greeks is unemployed. Half of young people are jobless. And the country is broke. Only the kindness of strangers in France and Germany keeps the lights on.

An economist would use a technical term to describe it – “basket case”.

But let’s look more specifically at a Greek… let’s look at Mr Stamatis Moraitis. Recently, he was the subject of an article in the New York Times. A remarkable man, he was diagnosed with terminal lung cancer in 1976.

Given nine months to live, he decided to economise on his own funeral. In the US he figured it would cost $2,000 to put him in the ground. In his native Greece, on the other hand, he could be planted for less than $200.

This seemed like such a good deal, Mr Moraitis couldn’t afford not to take advantage of it. But as it turned out, his penny pinching seems to have saved his life. 36 years later, he’s still alive.

Yes, the Greek beat cancer. The poor grave diggers got no tip. The undertaker delivered no bill. The children got no inheritance. There being no deceased, his house was not put on the market; so, no sales commission was earned… no remodelling was done… no new kitchen was ordered… and no moving company was engaged.

In short, Mr Moraitis cheated the economy out of a boost. Not only that, but reading further, we discover that Mr Moraitis lives on a poor island, Ikaria. Not only that, he seems to have disappointed economists at every turn. He didn’t build a new house; he moved into a small, cheap, old house with his parents. No new furniture. No new appliances. No new granite countertops.

The man is practically an anti-consumer. He makes his own wine and tends his own garden. No wonder the Greek economy is so weak!

Despite having terminal cancer, he sought no medical treatment. No chemotherapy. No radiation. No drugs. In short, he threw no bones to the housing industry. None to the health industry. None to Home Depot. Nor to Best Buys. Nor any other buys.

Pity the poor islanders. Ikaria is a small place, with just 10,000 Greeks. A bum economy. And nothing to do. No malls to go to. Few jobs; unemployment on Ikaria is about 40%. Want a fancy restaurant? Forget it. Want a fast car? Nowhere to go with it on the island.

So, what do residents do? Well, they tend their gardens. They drink a lot of wine. They visit with each other… often until late at night.

The New York Times:

 ‘… their daily routine unfolded…wake naturally, work in the garden, have a late lunch, take a nap. At sunset, they either visited neighbors or neighbors visited them. Their diet was also typical: a breakfast of goat’s milk, wine, sage tea or coffee, honey and bread.

‘Lunch was almost always beans (lentils, garbanzos), potatoes, greens (fennel, dandelion or a spinach like green called horta) and whatever seasonal vegetables their garden produced; dinner was bread and goat’s milk. At Christmas and Easter, they would slaughter the family pig and enjoy small portions of larded pork for the next several months.

‘Local women gathered in the dining room at midmorning to gossip over tea. Late at night, after the dinner rush, tables were pushed aside and the dining room became a dance floor, with people locking arms and kick-dancing to Greek music.’

They spend their days in the sun and their nights in merriment. They beat cancer. And they seem to live a long time; Ikaria has one of the highest concentrations of 100-year-olds in the world.

But their economy is not growing.

Poor bastards.


Bill Bonner

for The Daily Reckoning Australia

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Bill Bonner

Bill Bonner

Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
Bill Bonner

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5 Comments on "Why Economists Are Jackasses"

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3 years 11 months ago

Amen Brother

Kristy Willis
3 years 11 months ago
This is a good article to read on especially when you take it in as an “economist point of view.” Come to think of it, in some countries where people are more thrifty and are more content with their garden food, their economy are rather not growing as well. Third world country citizens are either non-productive due to their poverty status or just chose to live in a non-market consumer way. Is it the citizens or the country’s robbing political figures fault of the downfall of the economy? The Greeks may have chosen to live a laid-back life, but then… Read more »
3 years 11 months ago

I highly recommend reading the whole article on Ikaria here:

Great reading, and puts well to the lie of the need for endless growth, gadgets, mcmansions. Sometimes, less is just more.

truth and integrity
truth and integrity
3 years 11 months ago
You can print all the money you like. If you do not do a days work to provide for your family why should you or your children eat? You do not have to produce space transportation, computers, cars, visit Mars or Venus or mine gold but you have to eat to live. Check GDP = income + expenditure + production. You may see that you can have a +ve GDP with negative production. This is the false thinking and teaching of current universities, politicians, economists and banksters. The US created the Greek debt and all the other minor populated countries… Read more »
3 years 11 months ago
Thanks T&I. Now I feel like I want a rant into cyberspace also. I see God as the self evident truth though many describe God as all sorts of things. Maybe some people define God, at least partly, according to a set of moral boundaries which they alone are responsible for creating but which they hold as universal…which is a limited viewpoint in some respects. I am not saying there are not some universal laws written in all of our hearts. Importantly God dwells within us. And that power cannot be underestimated. So if I decide to let truth/my God… Read more »
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