Politicians don't understand economics

Let's be clear about it - most politicians don't understand economics. Which is a huge conundrum for me, given the fact so much of their job is actually related to it.

Some politicians might know a bit about governamental budgeting (not sovereign accounting, ok?), but they can't actually understand how an economy works at micro-economic level. When we start discussing about economic decision making at individual level, their insights are (at best) clogged or (more usually) simple guesses. You can clearly see it in the European Union initial proposal to bailout Cyprus banks (which, to "give a lesson" to a 0.2% eurozone economy, the EU decided to actually risk faith on its entire bank system), on the lack of proposals to propel the european economy back to growth and cut on spending (instead, european politicians prefer to raise taxes...) and the demagogy of not applying keynes theories to the fullest, on reducing public investment in times of growth to prevent market bubbles. But especially we can see it by their lack of focus on individual agents competitiveness, on the fact they don't really understand the value of innovation and differentiation to an economy, what is value accretion, the potential of higher education (maybe because a relative number of them has never really got one - but bought it).

When monetary policy became (almost) irrelevant, portuguese politicians (as an example), never understood that productivity should actually be the focus point of their economic speeches. But besides some hollow statements, this was never seen.

The european mess we are all going through arises mainly from the fact most politicians are mainly focused on tactical vote-gaining tactics or simple treaty negotiations - supported by an electoral bases that doesn't understand the growth of D&E countries actually hindered europe's competitiveness, pressing for productivity, innovation and differentiation.

To get out of the crisis, europe needs inspiring politicians, that understand the value of solidarity and growth, that can look at economic tissues and how to reinforce their competitiveness (or let them die and be replaced by others), that nurture micro-economics strategy - politicians like barack obama. If not, europe is on a crash course to become utterly irrelevant - and a lot poorer!

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