*Knowledge* that isn't

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One thing that economists *know* with absolute certainty is that every human will always act in a way which maximises his or her own financial position. It’s an assumption which underpins many economic theories – and, by extension, much of government policy. Applied to politics, and especially (although not exclusively) to conservative politics, it means that politicians *know* that people will always vote for the party which offers them the greatest personal financial benefit, regardless of the effects on others. Whilst some voters might actually tell the pollsters directly that they think a decent health service is more important than a penny or two off their taxes, the Tories *know* that those voters are lying, and that, in the secrecy of the polling booth, they will vote on the basis of personal benefit. And those who really depend on a public health service for their very lives aren’t in any of the target groups of voters.

It's what explains the Tory obsession with tax – whether talking about their own promised cuts or the other parties’ alleged increases – and why their tax promises are targeted at precisely those individuals and groups whose votes they are keenest to attract. They are convinced that recipients of tax cuts will vote for those implementing them. It also, in a roundabout way, goes at least part of the way to explaining the otherwise inexplicable decision of the PM to duck out early from the D-Day commemorations yesterday to do an interview with ITV in which he was talking about…er… tax. There is, to put it bluntly, no financial benefit to voters from his attendance at the commemoration, and it is therefore something which he doesn’t need to be concerned about. He really can’t understand what the fuss is about, or why others would be concerned – an attitude which shone through in his initial reaction to criticism, even if some slightly wiser head has since taken him to one side and drafted a more sincere-sounding apology for him to put out.

It is alleged that a firm in which he was a partner was one of those who was betting heavily against UK banks, and therefore a partial cause of the 2008 banking crisis. Whilst the extent of his own direct involvement is not entirely clear, the way in which such funds behaved at the time was a living demonstration of the idea that some people do pursue their own financial interests, no matter how damaging that may be to others, or even the country as a whole. It’s also of a piece with the acceptance of donations from dubious individuals. Everything is defined in monetary terms – even morality is subservient to money.

But here’s the thing. Those economists who *know* that we will all act at all times in our own best financial interest also know – or at least most of them do – that it’s really just a working assumption that they use to develop their theories and models. In the ‘real’ world, humans are complex creatures who don’t always behave as the models say they should, and those models can only ever give a sort of approximation to help understand the economic world. It’s a limitation on their *knowledge* which people like Sunak simply do not and cannot understand. And end up looking more than a little bemused at what they see as the stupidity of those who don’t behave as they are supposed to.