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The Necessity Of Ideology

Minimum wage has been a hot topic for quite a while. Those who want to impose a high minimum often latch onto a study by economists Alan Krueger and David Card that showed that a minimum wage increase had no effect on employment levels. That study had inherent weaknesses and involved limited circumstances, but even if it adequately described the actual overall effect of minimum wage in that New Jersey city, it goes against all economic principles and other works on prices. It would take a tremendous amount of evidence and powerfully convincing theoretical work to change the very foundation of economics, something that neither Card and Krueger nor any of their enthusiastic supporters have offered. That study simply confirms their ideological biases, in spite of overwhelming evidence to the contrary.

We all live our lives on the basis of the ideologies that we adopt. Our beliefs and ideas are built up over the course of a lifetime, based on education, experience, nurturing, and so on. Ideology is the filter by which we view the world and the framework upon which we build our opinions and and make decisions.

In spite of what post-modernists suggest, there really is an objective reality. The perceptions of that reality may differ between individuals, and though they filter the results to fit their own framework of understanding, there is a cause-effect relationship for everything that happens. Unfortunately, it is also true that causes and effects may be so far removed in time or space, or so obscured by other events that it is difficult to make the connection. That difficulty does not invalidate the connections. It is possible to use the same data and get different results, depending on underlying premises, data-filters, and methods, so the results might be perceived as vague or incoherent, but that just means that our perceptions and methods are limiting our understanding.

That limited understanding is not necessarily a bad thing. Because there are so many things happening constantly in our lives, and in society, the world, and the universe, nobody is capable of a complete and accurate knowledge of all causes and the resulting effects. We do, however, get from birth to death fairly successfully over the course of many decades. Most of the time, the limited knowledge we have is good enough.

The work of scientists is to identify the fundamental principles by which the physical world and our human society operate. To date they have been quite successful. We know a tremendous amount about causes and effects in the physical world, and, in spite of what anti-technologists and anti-capitalists may say, that has brought the many blessings of modern life that increase life spans and expand capabilities.

The same is true for economics. Though societies are complex adaptive systems and not machines, people long ago recognized a persistent regularity of phenomena in society and developed a set of principles to describe them, the laws of economics. Though what we observe may seem to be only vaguely represented by the laws, if at all, that vagueness results not from the weakness of the laws that describe the reality, but from our incapacity to connect billions of individual causes with the billions of effects. We do know, however, that artificially raising prices above a market price results in a decreased quantity demanded over time, which is known as unemployment for unskilled workers in the labor market.

Ideology is necessary for an efficient use of one’s time to filter the barrage of inputs from reality. The closer one’s ideology is to reality, however, the easier it will be to manage the inherent vagueness of life in society and prevent blunders that can lead to real damage.

Dan McLaughlin is the author of “Compassion and Truth-Why Good Intentions Don’t Equal Good Results.” Follow him at daniel-mclaughlin.com.

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