Ph.D. Octopus

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Economists: Scientists or the Court Poets of Wall Street?

with 3 comments

By Wiz

The blogosphere is wondering whether or not economics is a science. Ryan Avent and Mathew Yglesias say yes, and Krugman thinks maybe not. Atrios says “Basically the ignorant bullies took over the profession to some degree.”

There seem to be a couple of obvious things missing from this debate, that perhaps this humble intellectual historian could add. First thing lacking is any critical understanding of what science is. The general assumption seems to be: if economists can operate in some sort of “objective” world, in which value and personal bias don’t structure your results, where in good Gradgrindian fashion “facts and nothing but the facts,” determine your answer to a given question; in which scholarly debate can come to final conclusions about matters; where political power, ideology, and hegemonic values aren’t determining the results; where predictions can be made with some confidence, etc… If these things exist then we’re scientists!

Unfortunately, by most of these standards most scientists aren’t scientists either. In other words, even when dealing with cells and atoms this is a hard ideal to reach. To me, if there is one thing that historians, especially intellectual historians, can remind the world is that people are always the product of their time. They never exist in the rarified abstract space that is imagined here, where politics, discourse, and ideology don’t affect them. This isn’t to advocate some vulgar nihilism, but rather to remind people that conclusions are always provisional and always affected by the positionality of the observer.

And if I could posit a general theory of human knowledge here: one’s ability to even approach the scientific ideal of detached neutral observation gets harder and harder the more you study people and the less you study not-people (official scientific term there). And though you would excused in not realizing this when you read most economists, the profession is still ultimately concerned with human issues: wages, economic inequality, human motivation, environmental destruction, etc… Remember, after all, that Adam Smith was a moral philosopher, not a physicist. The idea that anyone could be drily scientific and objective about these issues– that their own personal biases, preferences, and, frankly, self-interest–would not color what they do is ludicrous and almost comically naive.

Then, when you consider the extraordinary degree of influence that economists have, from their perches in the WTO, the IMF, the Fed, the Treasury Department, the various think tanks, business schools, consulting agencies, university administrative apparatuses, op-ed pages, corporate boardrooms, etc… it becomes even harder to imagine that their thought is apolitical. In other words, it takes a shockingly naive mindset to believe that closeness to all that power and money does not affect the thought of those people. I don’t think it’s much hyperbole to say that– functionally– the economist profession more or less holds the place that the Catholic Church did in the 15th century. They provide the soft power behind the throne, the intellectual justification to make us feel good about the status quo.

And this is especially important because a vulgar and probably oversimplified economics is, by and far, the dominant intellectual discourse around the halls of power, and in general among elite circles. And not just in economics departments. Its prestige has bled into polsci departments, with their absurd rational choice models, and law schools, with the law and economics movement. And with the rise of the Freakonomics drivel, this style of thought is rapidly colonizing even middle-brow audiences.

Now, the individual economist is probably thinking, “but I don’t get paid by Goldman Sachs!” And surely many individuals are different. Some economists are even quite self-reflective and open-minded (some of my best friends are economists! Really!) But many of the leading lights in the profession do get money from Wall Street (lots of it), or go work for the Fed, or the WTO. And this matters. It creates a self-selection, in which those ideas (and the people who hold them) which are amenable to the powerful will tend to get promoted and vice a versa for those that challenge the powerful.

Which is why I’m shocked that the notion of ideology is missing from these debates. And not the vulgar definition as “ideology are irrational ideas other people have that gets in the way of pure scientific objectivity.” But the ideology that we all have, that allows us to function in society. As Foner describes it: “the system of beliefs, values, fears, prejudices, reflexes, and commitments—in sum, the social consciousness—of a group, be it a class, a party, or section.”

It sure seems to me that a bunch of well-educated, overwhelmingly white men who, by the way, get a ton of money thrown at them by Wall Street, and get access to some of the most powerful institutions on the face of the planet, would have a “social consciousness” that might not exactly be the same as, say, a maquiladora worker or a landless peasant. They just might be more inclined to see evidence of the virtues of a self-regulating market than those of us on the receiving end of neoliberal reforms.

And, of course, no one is saying that this process has to be a conscious one. It’s exactly the opposite. The very power of these ideologies is that they can appear as natural, as common-sense, as “scientific.” This is always true of the ideologies of the ruling class. And again, this isn’t necessarily because every one is bought off by Wall Street (though some are), but rather that the accumulated biases, thought-patterns, and habits of the profession are shaped by this world of money and power.

Which gets to another point, which I think I can say with some authority as a historian. This is that since at least the Enlightenment there have been attempts to justify the preferred political stance of a group by claiming the authority of science. This ranges from the silly (say, the Saint-Simons) to the evil (the American School of Ethnology, social Darwinism) to the otherwise interesting (Marxism). The reason is obvious: science confers a legitimacy and authority that masks, often to the believers themselves, the interests behind the intellectual project. It naturalizes and depoliticizes, and thereby chocks off the debate on a given subject. Any ideology, therefore, that can claim the mantle of science gains extraordinary power.

But needless to say, none of these ideologies have ever proven to actually be anything like scientific. We can now look back on the American School of Enthnology and understand them as crude apologists for slavery and almost no Marxists still think of their project as scientific. 50 years from now historians will look back on modern economists and easily be able to position many of the dominant trends in the profession within the matrices of neoliberal political, economic, and social power.

But let me make one final point. “Alright,” you might be thinking, “yes, some economists get corrupted by their closeness to power. And yes, this might affect the tone of the profession. But no one is perfect, and we’re talking ideals here. And economists strive towards a scientific demeanor which makes our intellectual production worthwhile, even if, yes, it should be taken with a grain of salt sometimes.”

But the problem is that economics, because of the topics it deals with, has unavoidably moral and ethical issues at stake. Issues of justice, equality, freedom, etc…, that cannot be discussed purely as science. They necessarily require choice. They are moral questions that the “scientific” tools of economics provide no relevant answers for. Is equality more important than efficiency? Should the welfare of the poor be a priority? What is more important, our desire for an efficient real estate market or our desire to protect a historic minority community?

At best, economics can help us to understand the stakes here: what the exact cost, say, of trying to preserve rent control is. But at their core, these are these questions of morality, justice, and citizenship. Even worse, it may even be that the dry, bureaucratic, one-dimensional style of thought that the “scientific” economics profession privileges may even predispose people towards the worse answer. That is, the crass utilitarianism, the methodological individualism, the celebration of possessive egoism as “rational,” the managerial gaze, and all the other aspects that comprise the economist imagination predetermine the answers to these moral questions, before we’ve even gotten the chance to begin discussing them.

Issues of means vs ends arise. Perhaps once those moral decisions have been made, the instrumental logic of disengaged science can help us reach the ends we desire. Once we decide to, for instance, help the poor, the tools of economists can assist us to determine ways to do so. But we cannot pretend that science provides us with answers about whether to help the poor. Just like we respect the opinion of an engineer about how to build a bridge, but we don’t give him any priority about who we should tax to pay for it, so we should be skeptical when economists pretend to solve profound moral or social questions for us.

This all isn’t to say that no one should discuss economics. Obviously I have strong opinions about the economy, just like most people do. But rather that we should recognize our own political and moral commitments, accept (even embrace) how those commitments probably affect our thought, and strive towards a certain humility. So ultimately I don’t think, say, Paul Krugman is a scientist. This hardly diminishes my respect for him. He is a public intellectual who has a certain expertise but also a clearly articulated set of political commitments. Good for him.

I should add, least I seem too self-righteous, that I hardly think historians are perfect. C. Wright Mills and Howard Zinn long ago showed the biases of “liberal” academics, and I don’t have much to add to them. But the stakes are much lower for us, and I do think, for better or worse, there is more self-criticism in our field.

Keynes used to hope that economists would be thought of as “humble competent people on a level with dentists.” Instead, though, it seems to me that we have a discipline that masks its increased closeness to the levers of neoliberal globalized power by holding ever more tightly to a facade of scientific objectivity. Dentists, perhaps, in that they’re okay with causing us pain. But hardly humble or particularly competent.

By the way: economists as “court poets of modern capitalism” comes from Alec Marsh, via James Livingston.


Written by Peter Wirzbicki

March 22, 2011 at 23:16

3 Responses

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  1. Check out the literature on this topic — social studies of finance.


    March 23, 2011 at 06:38

  2. The blogosphere seems to ignite with an “is economics a science?” debate every few months.

    Naturally I have strong views on this. The kind of economics that goes into academic journals, showing what precise conclusions follow from certain precise assumptions, and empirically testing models, is undoubtedly science. Most economists who are policy advocates are not being scientific. Paul Krugman won a Nobel Prize for be a scientist, but he’s much less of a scientist as a blogger and columnist.

    I completely agree that unscientific processes within economics determine which ideas get published in top journals, where the funding goes, and who gets top policy positions. But that doesn’t imply the field is not a science. There are lots of fields where scientists pursue problems that matter more to rich countries than to poor countries, and that doesn’t mean those fields aren’t science.


    March 23, 2011 at 09:53

  3. No way. Not a science.


    March 24, 2011 at 15:47

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