Economists Pretend They Don't Pick Winners and Losers

Economics has always had to grapple with questions of moral philosophy. Unlike most natural sciences, econ deals directly with issues of government and social policy. Should we raise the minimum wage? Should we have universal health care? Is it OK to take money away from the rich and give it to the poor? The answers to these questions rely not just on facts and numbers, but on moral judgments and on your point of view.

For example, suppose the U.S. government is considering opening up trade with a large, poor country. The move would make most consumers a little better off -- they would have cheaper clothes and toys. But a few workers in the textile and toy-manufacturing industries would be devastated -- their careers would be down the drain, all their knowledge suddenly rendered obsolete. If they couldn’t retrain for new careers -- and let’s face it, how many 45-year-olds can retrain for new careers? -- they’d be stuck in low-wage, low-prestige service jobs, or dependent on government handouts.