In his essay in the October 1990 issue of this journal, T. Michael McNulty 1 argues against the explanation of human behavior advanced by economists. Although McNulty's argument demonstrates a clear knowledge of the rhetoric of economics, it fails to recognize the value of economic theory. As the intiative for his essay, McNulty cites a statement made by W. Gene Smiley that accused the American Catholic bishops of being naive for stating in their pastoral letter on economic issues that "the fundamental moral criterion for all economic decisions, policies and institutions is this: they must be of service of all people, especially the poor. ''2 Smiley specifically accuses the bishops of ignoring the role played by market forces. McNulty asserts that "the clear implication of his [Smiley's] comments was that these forces are described by laws no different in kind than the laws of physics...'3 The key issue here is that McNulty claims the existence of economic laws, not Smiley. Once we go beyond the economic rhetoric and ignore debating whether economic laws exist or economics is a science, what is left is that economics can make substantial contributions to understanding and anticipating the impact of various governmental economic and social policies.
Once we ignore the contention that economic forces represent laws, the question remains, does ignorance of economic forces by the American Catholic bishops condemn to failure their policies? Many instances exist where the failure to recognize the power of economic forces has doomed well-intentioned policies. For example, attempts to regulate rent in New York City, in order to make affordable housing available to all, has resulted in a decrease in the number of apartments available for a given population.
Similar concerns can be raised in conjunction with the minimum wage. Although on the surface this appears a noble cause designed to increase the income of workers who receive the lowest wages, it ignores that such an increase results in a decrease in the number of workers employed. So although some workers will receive a higher wage, others will receive no