Occupy Economics?: A Report Back from the Nerdiest Protest I’ve ever been to.
I just got back from Chicago, where, along with attending the American Historical Association, I participated in a series of protests held by Occupy Chicago, along with CACHE (Coalition Against Corporatization of Higher Education) that targeted the American Economics Association (AEA). Its not everyday that the worlds of street protests and academic conferences blend so well. But then again, part of the point was to “puncture the bubble,” that academic economists live in.
The protesters gave out “alternative” awards for Most Conflict of Interests (Columbia’s Glenn Hubbard), Intellectual Narrowness (Harvard’s Greg Mankiw), and top prize, the “Toxic Waste of Space Award” (Harvard/Obama administration’s Larry Summers). Other than a brief yelling match that one protester got in with a professor, the tone was light and fun. Protesters “accepted” awards acting as Mankiw, Hubbard, and Summers (who reminded us how much smarter he was than us) and served “Rahmon” noodles, in honor of the Chicagoans impoverished by Rahm Emmanuel’s neoliberal policies. Overall a lot of fun, albeit fun that might have gone over the heads of the random shoppers on Michigan Ave.
According to protesters: “The bankrupt ideologies of ‘neo-liberalism’–trickle-down theory, austerity, deregulation, privatization–have all been proven empirically disastrous. Those ideas still enjoy a monopoly in the mainstream debate due to the massive scale of academic subsidizing by the bought AEA and it’s cohorts in the 1%.” Watch a great interview with an organizer at the bottom of this post.
It just so happens the protests came at a time of particularly hot debate about the ideology of the economics profession. The recent release of the minutes of the 2006 Federal Reserve Meetings well illustrates—along with Timothy Geithner’s utterly pathetic sycophancy towards Alan Greenspan—that the High Priests were asleep on the job, completely unaware of the looming housing crisis. Said one professor quoted by the New York Times:
“It’s embarrassing for the Fed,” said Justin Wolfers, an economics professor at the University of Pennsylvania. “You see an awareness that the housing market is starting to crumble, and you see a lack of awareness of the connection between the housing market and financial markets.”
“It’s also embarrassing for economics,” he continued. “My strong guess is that if we had a transcript of any other economist, there would be at least as much fodder.”
Not the discipline’s finest moment, no doubt.
I have a longstanding hatred/fascination with the foundational logic taught in modern Economics courses: its technocratic imagination, its inability to question its own premises, its ahistorical logic (see Daniel Rodgers’ Age of Fracture, Chapter 2 for more on how society, power, and history dropped out of the Economics discipline), its inattention to moral consequences, its reductionism (like the horrid Freakonimics series, which thinks all aspects of human existence can be explained by their simplistic assumptions about human behavior), and its normative amorality (seriously, studies have shown that taking economics makes students less generous people).
And this is all important because Economics inhabits a unique disciplinary position. Part academic discipline, part incubators of elite policy makers, academics in no other departments transition so seamlessly from academia to government to Wall Street. Look at a figure like Larry Summers, who has (in the last five years alone!) inhabited leading roles in all three worlds. While taking money from Wall Street while producing intellectual material about Wall Street suggests casual corruption, the influence that economists, and what Tony Judt called economism (the tendency to think of all social problems in terms of the marketplace) has deep ramifications on our public policy. The very power of economists makes it more likely that they will be captured by elites. I think, then, it is fair to target the AEA, even if many, if not most, economists are actually innocent of any corruption. It matters to the public what economists talk about, much more so than whats going on in, say, the MLA.
A silver lining, though, to the economic collaspe might be a rethinking of some economic thought.
Writing about the great shift in Economics departments that occurred in the 1970s, as Samuelson, Galbraith, and the other Keynesians lost favor, Daniel Rodgers writes:
“The economic crisis of the 1970s was, in short, not merely a crisis in management. It was also, and at least as painfully, a crisis in ideas and intellectual authority. An extremely confident analytical system had failed to explain or make sense of the unexpected.”
The results, according to Rodgers, were that the profession increasingly moved towards a more neoclassical model and microeconomics prevailed over macroeconomics. Meanwhile, the logic of markets and economic thinking invaded other disciplines: rational choice theory in political science, the “law and economics” movement in law schools, etc… One hopes that our recent crisis and the inability of our policy elites to predict or solve the problem, will produce a similar paradigmatic shift. This time, though, hopefully it will be away from such apologias for capitalism.
So in that spirit, I wanted to highlight two interesting thinkers. The first, I saw over at Crooked Timber, where New School economist Sanjay Reddy gives a fabulous interview about the need to bring moral reasoning back into the study of Economics. Reddy argues against the notion that Economics is a value-neutral science, restoring an “evaluative framework” to the discipline. It is impossible, he argues, to come to purely technical solutions to most problems. In a sense, Reddy is asking that we take moral sides before we engage in economic debate. First, for instance, we say that a goal of policy should be to aid the poor, then we figure out ways to so.
This seems to fit well with an article in the latest issue of Jacobin magazine (also featuring an excellent piece by friend of the blog, Andrew Hartman), by Mike Beggs, calling for radicals to occupy economics. Begg’s article asks economists to be less technocratic, and more openly political in their ends. Beggs takes a middle ground (for radical intellectuals), acknowledging that “mainstream economics is both an ideological bastion of capitalism and a genuine social science.” A tool for understanding the world, it is also wrapped up in a set of assumptions that are not neutral, but that favor a free market approach to the world. Nevertheless, as Begg’s points out, the stereotype that many have of a discipline of Milton Friedmans is actually unfair. A wide swath of economists agree with the need for some government intervention, and, other than a few reactionaries in Chicago or George Mason, most also acknowledge the importance of Keynes. The problem, Beggs suggests, is “not that mainstream economics was delusional, or biased to the right, but that it was technocratic.” It presumed it could manage and control, rather than take sides in class warfare.
In the opening editorial of Jacobin, the editors declare that, as the rebellion of Occupy Wall Street spreads, “we are in the last throes of the era of Ezra Klein.” What they mean, I think, is that the tepid liberalism of the technocratic elite (poor Ezra has, a bit unfairly, become a symbol of this) says nothing to the fundamental message of the OWS movement: the restoration of politics—full throated politics—to our understanding of class and economics. Class will no longer be something discussed in dry studies by the Brooking Institute or in economics seminars, but in the chants and marches in the streets, as those without challenge those with. Millions of people simply standing up and rejected these “market-based” solutions that have been crammed down our throats, will do more to change the dialogue than any polite article or policy paper ever will.
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