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Post-Autistic
Economics Network |
Edward
Fullbrook
© 1994 When
at this year's American Economic Association meetings a speaker used the word
conscience, embarrassment fluttered through the hall. "The
c-word" is taboo among economists. Its effect on our notion of
"rationality", which admits only isolated self-interest, is like a
lighted match in a petrol tank. The
unfortunate speaker (he was later publicly admonished for his impropriety)
was one of 7200 economists from over 50 countries gathered in Boston for a
three-day bash of reading and listening to learned papers. Astonishingly,
this global event for "the queen of the social sciences", addressed
scarcely a word to the world's mounting economic ills. This
year's venue, Boston's Copley Place, symbolizes economics' current
indifference to the woes and aspirations of the man in the street. This
city-centre complex stands as a postmodernist shrine to the socio-economic
aftermath of Reaganomics. A French colleague aptly dubbed it "an
American Versailles". No expense has been spared or architectural excess
foregone in constructing its three thirty-story hotels and their connecting
half-mile of arcades. These
warm marbled pleasure walks are home to Neiman-Marcus, Tiffany, Gucci, Louis Vuitton and, for nature-lovers, a sixty-foot waterfall.
With their banks of tropical foliage, the elevated arcades crisscross the icy
streets of the other Boston. When arriving from the airport by subway, that
system's antiqueness and the third-world despondency and shabbiness of its
users had shocked me. But in Copley Place, a city within a city and only a
short walk from Boston Common, every one looks middle class or above. America's
segregation of old required more than laissez faire. So too does
today's. Squads of hard-faced men and women in blazers police Copley Place's
homogeneity, especially at its few ports of entry to the other America. Even
the doe-eyed youths who administer loving care to the delicate plants wear
neckties. Copely Place, like similar developments in other American
cities, is a prototype of a new form of civic organization. It is
induced--some say necessitated--by the increasing bifurcation of America into
haves and have-nots. That economists should be meeting in such a place, given
their lead in creating prosperity for all in the first three post-war
decades, seemed poignantly sad. That
proud history desperately needs recalling. At the end of World War Two western
governments feared a return to depression. So they subscribed to the new
wonder remedy for economic ills, Keynesian economics. The cure rate was
astonishing. For three decades the middle class expanded as full employment,
low inflation and high growth reigned across America and Western Europe. It
set a record of economic performance completely without historical precedent.
In the wake of its colossal success the economics profession amassed
prestige, tenured positions and public funding. But
by the early 1970s, Keynesianism, like an antibiotic that has been over
prescribed, began losing its curative powers. Anxious to preserve its
position, the profession scrambled to package and market new remedies. The
earlier success, however, had given rise to the dogma that all of economics'
fundamental problems had been solved. This doctrine had made primary research
a forbidden activity, a career-destroying form of heresy. For a generation
the profession's patriarchs had permitted only analysis conforming to pre-existing
models of how economists of the past believed economies functioned. So, only
old ideas, ones predating Keynes, were available for response to the emerging
crisis. The
failure of those reconstituted ideas to stem the decline is now also part of
economics' history. Today Europe stews in persistent double-digit
unemployment as fascism and anti-semitism reappear.
While in the United States, it is public knowledge that for the majority of
citizens the American Dream is dead or dying. Falling expectations of
standards of economic management are now an implicit part of the public
culture. The era when a widening middle-class was the American norm and poor
nations had solid hopes of becoming rich now seems like a fairy tale. Memory
of the post-war economic miracle greatly embarrasses today's economists. It
testifies to our radical inferiority to our predecessors in terms of our
capacity to treat economic ills and to be of use to society. Knowing one
belongs to a degenerating science does not make one feel good. Consequently,
the post-war miracle is now, by various means, being
"progressively" written out of the collective memory. Already
economics' radical failure to cope with the millennium realities has become
one of "the unmentionables of our time" (J. K. Galbraith). In lieu
of a sense of history and of service to humankind, the economics profession
increasingly takes refuge in meaningless mathematical puzzles and in the
vainglory of its Nobel Prizes. As
a participant in the Boston conference I received a 382 page program listing
the 564 sessions and the over 2000 papers. In vain I studied it for signs
that the profession wished to address itself to the economic crises griping
the world outside Copley Place. And, I should add, the paper I gave was no
exception. In
any discipline responsibly intent on rectifying its failure to adequately
represent and explain its object of inquiry, one would expect to find two
things: an empirical focusing on those areas where the system of
representation had proven particularly inadequate, and a serious, no
holds-barred, critique of theories and concepts. But,
except for sessions organized by women, who recently have gained a toehold in
the profession, there was scant sign of such empirical focusing. And there
were no signs at all of mainline interest in rethinking the theoretical
structure. Orthodox economic theory is now more sacrosanct than Christian
dogma. I
had registered too late to get a room in one of the Copley Place hotels. So
at the beginning and end of each day I had to leave my hot-house world and
step out into the real republic. Walking from my hotel on the morning of
"The Presidential Address", I came upon a parked ambulance. In the
doorway of a boarded-up shop, one of Boston's homeless had been sleeping. At
first I thought he was elderly; then I realized that the white in his hair
was frost. A
few hours later, the president-elect of the American Economic Association
stood under an elephantine crystal chandelier. He recalled how 43 years ago
he had arrived in America as an immigrant. Fair enough. But then he claimed
that his standing there as the head of "one of the most powerful clubs
in the world" epitomized the realization of the American Dream. Suddenly
it appeared to me that the president had crossed over into the subversion of
an ideal. Surely that dream which has given inspiration to most of the world,
was not this picture of a man in the exclusive splendour of Copley Place
celebrating his hold on the reins of power of a notoriously undemocratic and
illiberal institution. Surely the American Dream, when it had lived, rather
than championing the few over the many, had been something like the opposite. I
remember it as the dream that all people, especially those who did not yet
have them, would be well provided with the necessities and comforts of life,
endowed with the dignity of good education and productive work, and who,
after their labors, would feel free, safe and
willing to mingle with all comers in truly public places like Boston Common.
The president's inversion of the American Dream, uttered without malice and
in the vacuum of a forgotten history, seemed symbolic of the moral decline. If
economic orthodoxy is correct, this article will succeed in arousing not a
single economist from their complacency. If economists are
"rational" men and women, seeking to "maximise their
utility" as isolated individuals, then they have nothing to gain from
abandoning their professional disregard for the economic perils of our age.
Neither their livelihoods, nor their junkets, nor their prestige, nor even
the aura of their Nobel Prizes are at risk. Indeed, they will find their
self-esteem severely dented if they dare venture beyond their Copley Place
worlds. So, in the end, I have no basis for
"rational" appeal. In the end I can only invoke the c-word with
intent. All I can do, all anyone can do, is appeal to
their conscience. |
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