The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.
Thus wrote Henry Hazlitt in his classic book “Economics in One Lesson” over 60 years ago. The book is still in print. And best of all, the magic of the world wide web gives you free access to the book. (Here’s a pdf version.)
I think economics literacy must be mandatory in any society which fancies itself to be a democracy. Because otherwise people don’t understand the implications of the policies that they vote for and society enters a downward spiral. Ignorant people at the top making short-sighted policies, which makes the economy poor, which leads to a poor ill-informed citizenry that votes for bad leaders, who promote bad policies, . . . the spin cycle finally concludes when the whole wash goes down the tubes.
The special pleading of selfish interests is what makes an inherently difficult subject prone to numerous fallacies. The first paragraph of the Lesson makes that point clear. “Economics is haunted by more fallacies than any other study known to man. This is no accident. The inherent difficulties of the subject would be great enough in any case, but they are multiplied a thousandfold by a factor that is insignificant in, say, physics, mathematics or medicine–the special pleading of selfish interests. While every group has certain economic interests identical with those of all groups, every group has also, as we shall see, interests antagonistic to those of all other groups. While certain public policies would in the long run benefit everybody, other policies would benefit one group only at the expense of all other groups. The group that would benefit by such policies, having such a direct interest in them, will argue for them plausibly and persistently. It will hire the best buyable minds to devote their whole time to presenting its case. And it will finally either convince the general public that its case is sound, or so befuddle it that clear thinking on the subject becomes next to impossible.”
Anytime you wonder why India is poor, wonder no more. Pay attention to the public policies that the fearless leaders of the land are advocating. And there you will find your answers as clear as broad daylight.
Read the book carefully. It may be a while before I write one for you. 🙂