Why I am an Economist

An unexpected journey

I didn’t intend to become an economist. It happened through a series of unexpected twists and turns.

Early Years

When I was young, and heard about economics on the news, I wanted to have at least a basic understanding — it seemed to have a big effect on people’s lives. I thought my Dad, an accountant, would be able to help, but his explanations used the same jargon as the TV news and the business sections of the newspapers, and I never found out exactly what it all meant.

After university (mathematics and computation), I bought a 1st year university textbook on economics. Surely with the maths I’d learned by then, it should be straightforward?

No, it wasn’t. It looked like maths, with equations and graphs, but it was nebulous. For example it listed the following as factors affecting how much demand there was for a product:

• “the consumer’s taste for good X”,

• “the consumer’s expectations about future prices”,

• “advertising”, and

• “other relevant factors”

After waving away these factors by assuming they don’t change, it went on to give the law of demand as: “The rise in the price of a good leads to a fall in the total quantity demanded [and vice-versa]”. And worse still, even this relationship between price and demand isn’t true for all goods. You could summarise this law of economics as: “Higher prices lead to lower demand, except when they don’t.” It’s hardly a law like Newtonian mechanics.

I soon gave up. If there was a science to economics, I wasn’t going to get it from the textbooks.

No obvious progress

While working as a software developer, and learning object-oriented analysis (basically creating mathematical models of the real world), I’d occasionally wonder things like:

• “If someone buys cut flowers with money, and the flowers die, is there now too much money in the world?”

• “Why are people happy to use paper as money?”

• “Can it really be good for the economy to pay some people to dig holes in the ground, and other people to fill them in again?”

I’d try to work out answers for myself, but didn’t get far.

Money as Debt

In early 2008, a work colleague told me about an animated film on YouTube called “Money as Debt” by Paul Grignon. It claimed that the banking and monetary system was fraudulent — a way for bankers to loot the rest of us. Another claim was that when banks charge interest on loans, there’s never enough money in the world for everyone to pay the debts they owe to banks.

I’d been thinking that something was badly wrong for a while, with house prices rising far quicker than incomes, talk of a “credit crunch” from mid-2007, and the collapse of Northern Rock Bank. So I took a look.

My plan was to see if I could use some of the analysis techniques I’d learned from my career, to find a simple scenario in which someone borrows money from a bank for a useful purpose, successfully pays it back, with interest, and everyone involved ends up better off than when they started. To cut a long story short, I found it was possible. But more importantly, I discovered the new One Lesson: genuinely comparable to Newton’s laws of motion, which has answered basically all the questions I ever had about economics.

And now I’m stuck

I’m convinced the One Lesson is right, and shows up errors in all sorts of other theories of economics, as well as in what governments and central banks are doing. The problem with this is that I feel like I can’t drop it now, because I can see the disastrous consequences which await if the authorities ignore it.

I’ve given a few talks, made a few YouTube videos, submitted a paper to a journal (it was rejected), get involved in conversations on Twitter, and now here I am on substack. Sometimes people are more or less convinced. I even met a mathematician at a talk who saw straight away how important the One Lesson is as a linear model of the economy, but I lost touch with them.

So I have to keep working, trying to communicate the One Lesson and its applications, and perhaps to refine it over time. I hope I can convince you that the One Lesson is right, and that you, dear reader, can help me to share it, so that together we can try to stop the authorities from making terrible mistakes, or at least we can hold them to account for their decisions.