Ph.D. Octopus

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Conflicts of Interest in Academia

with one comment

By Wiz

I thought this article on Lawrence Summers by film-maker Craig Ferguson, in the Chronicle of Higher Ed, is absolutely essential. Gallons of ink have been spilled on the various sins of Lawrence Summers, but Ferguson’s point is really a simple one. Summers has had massive conflicts of interest throughout most of his career. He has personally benefitted tremendously from the financial deregulation he has supported in his academic work.

Over the past decade, Summers continued to advocate financial deregulation, both as president of Harvard and as a University Professor after being forced out of the presidency. During this time, Summers became wealthy through consulting and speaking engagements with financial firms. Between 2001 and his entry into the Obama administration, he made more than $20-million from the financial-services industry. (His 2009 federal financial-disclosure form listed his net worth as $17-million to $39-million.)…Summers’s career is the result of an extraordinary and underappreciated scandal in American society: the convergence of academic economics, Wall Street, and political power.

Economics departments are particularly rife with connections between industry (especially finance) and government. But they’re not alone. Medical school professors, for instance, are shameless in their connections to the pharmaceutical industry. In other words, they hang out with people in positions of extraordinary power all the time, the very people who stand to benefit from their intellectual production. Is it surprising that their intellectual frameworks are so comfortable for those in power?

Prominent academic economists (and sometimes also professors of law and public policy) are paid by companies and interest groups to testify before Congress, to write papers, to give speeches, to participate in conferences, to serve on boards of directors, to write briefs in regulatory proceedings, to defend companies in antitrust cases, and, of course, to lobby. This is now, literally, a billion-dollar industry.

It’s worth pointing out here, that no one has to prove that Summers was bought off by Goldman Sachs, or consciously affected by the money they gave him. Ideology works in much more subtle ways. But clearly his career was helped by the fact that his own internal instincts were to suck up to finance capital. And it’s hard to believe that hundreds of personal connections with bankers, and, one assumes, very little personal connection with the janitors who clean their toilets, has no impact on how you see the world.

Would anyone trust a journalist, say, who took hundreds of thousands of dollars from the sources he or she was reporting on? Why, then, should we trust an academic?

It seems to me that, just as journalists and business students have to take classes on the ethics of their profession, academics might benefit from a more open debate about the ethics of their profession. Especially in those fields with such a “cash value” that have close ties to business, government, or other forms of power.


Written by Peter Wirzbicki

October 8, 2010 at 14:25

Posted in Academia, economics

One Response

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  1. […] many social graces, and actor Douglas Urbanksi captures this perfectly. Though Summers has been criticized on this blog, and I’m no fan of him as an economist, I liked him as president of Harvard, as […]

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