Geoff Tily of the TUC spoke at what looked to be an important event at the LSE last night to launch a new book called The Econocracy, which I could not attend. In his notes for the event on the TUC blog he suggests that:
Academia blocks progress in economic thought
and concludes:
The so-called golden age after the war was not the result of chance: it was the result of a collective exercise of reason and political will. It is a grotesque parody to suggest it was only made possible by war. We should surely proceed on the basis that a second golden age is within our grasp.
I agree with both ideas. The solution is obvious: we have to shatter the stranglehold of falsehood that is sold as if it is economics by almost every university department that bears that name.
The blog's worth reading. I suspect the book will be as well.
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Mainstream economics is an exercise in depoliticisation based on inaccurate interpretations of history and a false claim to scientific rigour.
It tells us that we must enact certain policies because they are scientifically proven. You can’t do this or that because it goes against the rules of science.
You can manipulate and shape an economy. You can’t bend science. Social sciences and economics are not sciences.
You only have to read Chang to see that to build a successful economy much of what you need is actually pragmatic common sense, leadership and long term vision.
Agreed
Agreed as well and the big difference between the golden age and now? Policies put people first then, God knows how many times Richard has written about the need for people first direction. In more recent years acknowledging that this goes hand in hand with environmental concerns.
If you have a priority list then anything but top spot will suffer in some way. As long as the top spot is profit, as it is now, then a golden age won’t reappear.
“Academia blocks economic thought”. I find this tends to deflect blame away from the real problem which is politics. Economics is incredibly diverse and for every Mankiw, Reinhart and Rogoff, there is a Piketty, Stiglitz, Murphy, Chang and Keen. In fact there are so many unorthodox views that it has become mainstream to attack the mainstream. The problem is that while economics has moved on, politicians are not listening.
What is really bizarre is that you find the OECD, IMF etc. all producing thorough economic studies that show that inequality is bad and still politicians do not listen. Did Osborne even notice that Reinhart and Rogoff were wrong and that there was not econometric evidence to support austerity?
Many economists, and I include Richard in this, know exactly what the problems are. The politicians need to read and learn.
I agree, but only in part
There are economists (a majority of them, in my opinion) who more than happily reinforce those political prejudices
A useful article thanks
The Bank of England and Andy Haldane its Chief Economist in particular, has emerged as one of the most cogent challengers to the economic orthodoxy and those on the right (and many in the centre) who cling to it. Like drowning men to a brick some might say
Perhaps that explains some of the hostility that we’ve seen towards the Bank recently from the Tories and Brexiteers.
You probably have a better handle on “hostility from Tories and Brexiteers”.
I know Teresa May has spoken against QE as currently configured and rightly. That implies a move towards an effective variant of QE because the system can’t function without it, and they must know that.
I’d agree with you on the need for a different form of QE, along the lines of the Green QE that Richard talks about. Nevertheless, Its worth keeping an eye on what’s coming out from Andy Haldane in particular, who is challenging the economic academic establishment
Agreed re Haldane