"economics are chaotic, not Newtonian..." This is hugely important. First, there never will be a set of equations, that given a gazillion variables will pump out a usable long term economic forecast, but the reliance on faulty models will exacerbate the risk. Case in point: nearly all the players in the derivatives markets used the Value-at-risk model to price the riskd of their derivatives. Guess what, it was wrong, and it was so wrong that last year all the companies tanked, not just one. It was wrong because it couldn't handle the psychology of panic.
Second, the Newtonian fallacy that every effect has a direct cause, leads politicians and economists to rely on flawed models like VAR and misguided social programs where the belief is that, if you tweak the cause, the desired effect will follow.
Second, the Newtonian fallacy that every effect has a direct cause, leads politicians and economists to rely on flawed models like VAR and misguided social programs where the belief is that, if you tweak the cause, the desired effect will follow.