A shame
economics is not widely taught at schools during the ‘general education’ stage.
The high-school curriculum includes a course in ‘basics of entrepreneurship’,
which gives brief overview of rudimentary economic concepts to teenagers, but
attention the course receives from both teachers (who often deem it to be a
ball and chain to do everything to tick it off) and students seems inadequate.
The upshot is that understanding of economics among ordinary people appears
insufficient.
Basic grasp
of economics (as well as of any discipline, ranging from fine arts, through
physics, ending on medicine) is essential to function well in the contemporary
world and to understand how it all works. I do not posit an ordinary man should
be familiar with all the concepts a first-year student of economics should know
inside out to get a pass in courses in basic micro- and macroeconomics or
finance. An average man should not learn by heart formulas, solve equations,
nor drill down vague concepts. An average man should recognise some causations
and be aware how some phenomena affect their own personal finances.
Command of
basic economic principles, from what I have observed, gives you one ultimate
benefit in life. If you are well-versed in economics, you are less likely to be
deceived by other people. And those who are most likely to trick you come
usually from three groups: politicians, journalists and self-styled financial
advisors. Politicians tend to over-promise, but an economically literate voters
should be able to assess whether the promises are affordable for the state.
Journalists in Poland too often have too little notion on topics they write
about, or do not carry out extensive research before spewing out an article,
but economically literate readers should be able to distinguish substantive
piece from a bullshit (pardon the foul language). Financial advisors are those
who try to appear as wiser than you when it comes to managing your personal
finances, while in fact they are just fee-oriented salespeople, who advise you
what is good for them. An excellent example of a man who fell victim of their
“advice” was a guy who in 2007 looked for a loan to buy a flat. Property prices
at that time were sky-high, but paradigm that they will double over the next
decade was still widespread and risk tolerance excessive. Prompted by a
financial advisor, he took out a 110% CHF-denominated mortgage to finance a
flat purchase for 400,000 PLN. The remaining 40,000 PLN he invested in
aggressive investment fund at the peak of stock market bull market. In 2007 his
assets equalled liabilities and stood at 440,000 PLN. After the financial
crisis: value of his flat dropped from 400,000 PLN to 300,000 PLN, half of his
contribution into investment fund evaporated, his mortgage debt, converted into
PLN, mounted to 800,000 PLN. A few years later the guy’s assets were 320,000
PLN, while his liabilities were 2.5 times higher.
The
approach in which you focus on outcomes of economic processes, without
exploring details, is far too rare in today’s economic discourse. Those who
propagate speaking about economics in simple words, intelligible for an average
man, deserve the biggest accolades. Tadeusz Mosz, who departed last Wednesday,
was one of such men. His TV and radio programmes have done a superb job in
terms of promoting economic literacy among masses. He had his own unique style
and his guests had to conform to it. In his programmes there was little room
for economic jargon; meanders of economics were straightened out into plain
language and outcomes were favoured over the workings. Mr Mosz was facing a
huge challenge, since in economics “it depends” is the answer to too many
questions. For example, if you ask, whether it is good for an average Pole, if
PLN appreciates and bad when zloty depreciates, or the other way round, there
is no straightforward answer. It depends on a variety of factors. And you can
go on for hours about them… A mediocre economist could witter on about exchange
rate movements and their whys and wherefores endlessly. A clever economist,
appearing in Mr Mosz’s programme before audience made up of ordinary people,
would have to squeeze the answer into a few straightforward, informative
sentences in plain Polish.
For many
months I have not followed Mr Mosz’s programmes. I would not be even able to
tell you how long before his departure he had ceased to turn up on air. Some
four years ago, as a student, I would follow his “Plus Minus” programme in TVP
Info on day-by-day basis. I used to watch it, but I was not fond of it. As a
student fascinated by complexity of economics and financial markets, I found
the discussions moderated by Mr Mosz over-simplified, far over-simplified. I
craved for splitting hairs, touching hearts of problems, while Tadeusz Mosz’s
guests focused on what economic phenomena mean for ordinary people. With
hindsight I see at that time I was out of his league.
Mr Mosz’s
style of presence in the public discourse bears out, again, the paramount
importance of linguistic clarity. To be an expert in a specific area, you need
to have extensive knowledge, but to be an outstanding, widely appreciated
expert, you must be able to share your knowledge with ordinary audience in
simple words. The ability to convert intricate issues into plain language is
the skill that ought to be fostered.
Tadeusz
Mosz’s death came as a bolt from the blue. He had no makings of a celebrity, so
no one could keep track of his struggle against cancer in gossip columns. For
the last weeks he suffered in silence and passed away in silence, with dignity.
His departure is a great loss for economic journalism in Poland, as I dare to
claim no other journalist has done so much to bring economics closer to people
and help them understand for it affects their lives. His work should be carried
on, but is there any successor who could take it over?
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