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It’s the Economists Stupid

David Kristjanson-Gural

Economists like to think they are scientists but for the most part, aware of it or not, they are shilling for the powers that be.  We won’t get out of this mess, until we call them on their shell game, broaden our thinking about how and for whom the economy works and take matters into our own hands.

What makes economists think they are doing science?  Well, economists collect data and test their theories against objective real-world facts.  They ask how well their models predict outcomes.  They portray themselves as disinterested, as simply providing policy makers with facts; it is the policy makers who make normative judgments concerning policy – who gets the tax break; who gets fired; who gets fed. If you or I criticize their methods we are written off as unscientific, having an agenda, somehow weak minded.

Scratch the surface of this façade and it quickly crumbles.  Economists rely on theories riddled with normative judgments – more is better, work is a disutility, it is rational to be self-interested – and with ways of viewing the world that skew their vision – we act independently, we are rational, labor is a resource. 

Because economists’ theories, with all their implicit judgments and viewpoints, inform their way of seeing the world, the data they take to be an objective measure against which to test their theory is not objective at all.  It is, itself, defined by the theory it is used to test.  There is no objective measure, somehow defined outside of theory for theorists, economic or otherwise, to test their theories.  Nor can economists, any more than soothsayers, predict the future.  What is most surprising is not that economists think they are doing science, but that they have so little curiosity about what it means to do science.  These observations on the problems associated with scientific method are more than 50 years old.

Don’t think I’m saying that one cannot do economics at all, only that any number of approaches to economics, be it institutional, feminist, Marxist or ecological, is possible.  Each theory defines the economy differently, describes human behavior differently, and comes to different conclusions about what to do.  One cannot claim as mainstream economists do, that only their approach is correct; only their approach produces a rational view of the world.  That’s pure hubris.  Hubris got us into this mess and it’s unlikely to get us out.

So it’s curious when a well-known economist decides to change camps.  I am thinking of Richard Posner, the well-regarded Chicago school economists who recently declared he is now a Keynesian.  Mostly when economic theory goes awry, economists blame everything except the theory – the data was faulty, an exogenous shock.  Rarely does someone have the courage and honesty to consider he might have been wrong, all along, to think that markets are self-correcting. 

So let’s applaud Posner and for the time being put aside all the harm he and his cohorts have wreaked, at home and abroad, by insisting that markets self-regulate – a position that Posner has now, after thirty years of war on the working class, concluded is false.  Let’s not ask, either, why the breakdown of the world economic system has yielded only one such convert.

The question I have for Posner is this:  Which Keynes are you lining up behind - Keynes the conservative or Keynes the radical?  Keynes the conservative sees the irrationality inherent in financial markets and protects the wealthy classes by insulating the real economy from this irrationality.  Keynes the conservative protects capitalism from the actions of the real radicals – those who would throw open the door to even greater market excess in order to prove, once and for all, that economic collapse is not due to too little intervention but too much.  Keynes the conservative would cringe at the Supreme Court’s decision, to treat corporations as persons, to flood the political system with even more corporate dollars to undo regulation. Keynes the conservative knows that without such intervention, and at least a veneer of legitimacy, the capitalist system is doomed.

I doubt very much that Posner is lining up behind Keynes the radical.  Keynes the radical sees the irrationality inherent in financial markets and seeks to socializes wealth to prevent workers from being thrown out hungry into the streets. 

Keynes the radical believes that rationality results not from ‘independent’ profit-making decisions of corporations but from analysis and debate that produces policies that promote the common good.  Keynes the radical considers the economic prospects of our grandchildren.

But Keynes the radical was no radical.  Keynes the radical had no faith in the ability of working people to take charge of their economic fate. Keynes, even Keynes the radical, was all top down.  All white bread.  All patriarchy.  All stuffed shirt. We’ve been there and done that haven’t we?  Good for Posner for renouncing the blind faith that got us all in this mess.  But even Keynes the radical can’t save us now.

The scientific community, I mean the real one, has its own problems with objectivity, but most scientists agree that we have to act very quickly to avoid catastrophic climate change.  Throwing the door wide open to corporate dominance of politics is irrational – the legal equivalent of the final scene from Thelma and Louise only, this time, the straight white men are driving and you and I are on board.  Someone has to get their foot on the brake and grab the wheel.

Howard Zinn’s gone.  Gone, now, just when we need him the most.  But his whole life he has been pointing us in the right direction.  Don’t be impressed by the men in suits.  Don’t listen to the pseudo-scientific babble of the high priests of the economy.  Take things in your own hands, work for what’s right, make a bold move in the direction of the common good.  It’s you and me who have to get up front and grab the wheel.  We have to do it now – we have no time to waste.

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David Kristjanson-Gural is Senior Fellow of the Social Justice College and Associate Professor of Economics at Bucknell University. He is a member of the Spilling Ink writers' collective (


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