At 9:41 AM -0500 11/17/98, Arthur Cordell wrote:
>I would guess that if economics would (could?) internalize all
>externalities and would stop playing the economic growth game (which I
>don't
>think is central to economic theory--a theory which deals with the
>allocation of scarce resources among competing uses), then Jay Hanson and
>company would have less of a problem with economics.
I would like to say that while I deplore the invective generated on
this issue, I can understand it, and I think it has cleared the air a
bit. It has certainly led to some excellent posts by various people and
expecially to Jay Hanson's "What Other Way Is There to Live". I think
Mr. Hanson has a good mind and a vital message, but I think he would be
much more effective if he emphasized the positive as he does so
beautifully in that post, rather than the dire and gloomy, as he so
often does, even in his public name of "Dieoff". People need to
understand the urgent dangers, but I think it is positive visions which
inspire them.
I hve been thinking of joining the fray since yesterday, and while I
feel that I have been largely pre-empted by Mr. Cordell's terse comment
which goes close to the heart of the issue, as well as by Tom Lowe, who
covers much of my ground, I think there are still a few more things to
be said.
Jay Hanson's view of economists would not even have been questioned on
some lists I am or have been on. The reasons certainly include those
raised by Mr. Cordell, but I think there is a bigger issue, real or
perceived. It is not just that the economic establishment seems to have
no problem with ignoring "externalities" like severe weather and grave
damage to the environment and human health, which impose huge economic
as well as social costs (not to mention the unfairness of shifting
those costs onto the general public or the gigantic distortions they
introduce into the allocation of resources), and the obvious limits to
growth on a finite and arguably "full" planet-- omissions which are
tantamount to engineers' ignoring gravity and windage, and which
clearly vitiate any claim that economics is a science.
I think the real reason for the widespread hatred of economists is that
they have been become the de facto priesthood of the world wide
religion of "free market" globalism, based on maximum economic growth.
I call it a religion because it (in its dominant orthodox neo-classical
form):
1. claims to be based on a scripture (The Wealth of Nations) which is
quoted selectively while ignoring its essence- e.g. that a free market
cannot exist where there is monopoly of any kind, unequal information,
etc.;
2. clings to a rigid dogma, litanized as "lower taxes" and "less
government" regardless of the disastrous results for the great majority
of people;
3. claims to have brought (or shortly to be bringing) a paradise of
global prosperity despite the facts that:
a. real wages have been declining for over a quarter century
(since 1972),
b. the gap between rich and poor, both individuals and nations,
is greater than ever before, and increasing rapidly,
c. even in that paragon of 'prosperity' the USA, most families
must work at at least 2 jobs and not uncommonly 3 or 4 jobs just to pay
for the 'necessities' and still private debt is climbing to
unprecedented peaks, while diseases related to stress and environmental
deterioration soar;
4. continues even now to justify the speculative floods of hot money
sloshing around the world bringing poverty, misery and death (by
suicide, violence, or starvation) to millions of people;
5. admits to the company of the elect (graduate and especially PhD
programs) only those who have demonstrated ideological purity (I have
this on good authority, from several people who are currently PhD
candidates. There are a few schools where heresy is tolerated or even
encouraged, but the vast majority, including all the centers of power
and influence, insist on blind orthodoxy);
6. welcomes the role of pundit and advisor to the world which is thrust
on it by the corporate media; thus whenever there is news of a
government initiative, or indeed almost any kind of news, the
priesthood is consulted for its advice, which usually is "lower taxes
and less government interference";
7. has presided over the concentration of corporate wealth and power
(which has long since gone past the classical boundary of monopoly i.e.
fewer than 10 significant players in an industry, or any one
controlling 12% of the market or more) that has made
corporations--immortal, inanimate entities, whose paramount duty is the
maximization of profit-- the richest and most powerful institutions on
the planet-- even as regulation of them is reviled and destroyed;
8. has applauded as "wealth creating" mergers in which assets are
stripped, plants closed and workers laid off in massive numbers
(sometimes to be hired back as temporary help at half their former
wages and no benefits)-- perhaps the greatest redistribution of wealth
(from the middle class to the rich) in history;
9. embraced the DJI and the GDP as the only measures of well-being,
although almost all measures of "quality of life" or "genuine progress"
show both to be in a tailspin even as the official measures soar to
unprecedented (and highly unstable and unsustainable) heights;
10. continue in general to justify corporate welfare even as they trash
social programs.
Those are a few of the reasons that many people hold econimists in ill
repute. I might also add that they have used highly unethical means to
suppress competing ideologies. For instance it is literally true that
neo-classical economics was invented and its principle institutions
created and funded primarily to wage war on Henry George who had the
temerity (a) to write and speak eloquently, popularly and
comprehensibly on the subject with no academic credentials, and (b) to
suggest that natural resources (i.e. the global commons) were provided
by nature for the benefit of all and that those who sequestered them
for their private use or profit should pay a fair rent to society as a
whole. They did a similar but different hatchet job on Keynes. They
misapplied his teachings by indulging in massive deficit spending
during the fat times and then when that produced a large debt (inflated
out of all proportion by draconian monetarist interest rates) they
excoriated Keynes, and turned his Bretton Woods institutions, which
were created to give greater control over currencies and to insure
monetary and exchange rate stability, into champions of the global
casino, and insurers of the bets of the biggest players.
I admire Mr. Silverman's courage and wisdom in taking the stands he
did, and I am sure they did not enhance his reputation among the
orthodox. There were and are doubtless many other "good" economist
about; E.F. Schumacher and Mason Gaffney spring immediately to mind,
and there is a valuable but obscure school of Ghandian economists,
including (among others) Romesh Diwan. But we hear little of these
heretics while the edicts of the orthodox priesthood (and the brutal
effect of their policies) are ever before us, so it is not surprising
that the backlash is strong.
I too enjoy this list more than I expected to. One of the things I
value most about it is the diversity of viewpoints and the wisdom of
the retired Canadian civil servants who seem to be present in some
force. I better understand the respect in which the Canadian civil
service used to be held, and lament the fact that it has largely been
usurped by neo-classical ideologues, aspecially in the centers of power
like the finance ministry.
I hope that this sheds at least as much light as heat on the subject.
Caspar Davis
Victoria, B.C., Canada
A wall of infinite dimension stands before the course of human evolution.
It is the finitude of the earth and its resources.
--Steve Morningthunder
