Letters: Reconnecting economics and real life
Bravo Manchester University economics students for criticising “university courses for doing little to explain why economists failed to warn about the global financial crisis” (Economics students rebel at orthodox free-market syllabus, 25 October). However, there could be no explanation of why economists had failed to warn about the crisis, precisely because a significant number of high-profile non-neoclassical economists had warned about the crisis.
Further, of the 12 or so economists – recent Nobel prize winner, Robert Shiller among them – identified in Dutch academic Dirk Bezemer’s paper No One Saw This Coming, three were awarded the inaugural Revere Award for Economics. Steve Keen, Nouriel Roubini and Dean Baker were voted to be the three economists whose recommendations, if world powers had acted on them, could have avoided the global financial collapse. Keen, in his 2011 book Debunking Economics, writes: “Why, despite the destructive impact of [neoliberal] economic policies, does economics continue to be the toolkit which politicians and bureaucrats apply to almost all social and economic issues? The answer lies in the way economics is taught in the world’s universities.” Vive the post-crash economics society.
• The students are right to complain about the limited scope of the economics curriculum. This seems to be true of all economics departments as well as politicians, Treasury officials et al. All seem to be unaware of any alternatives to free-market economic analysis. A recent article in the Guardian about new measures the Bank of England governor proposed to control the housing market, said these new measures were an unknown as to their possible effects on the financial markets. To any student of economics in the 1960s, these measures were very familiar. Then they were known as directives and were highly effective in preventing an inflationary property boom. The so-called revolutionary policy of quantitative easing is not so new. The open-market operations, as they were then known, of the late 40s exceeded in scale that carried out by today’s government. It was so extensive that it resulted in a credit strike, when the banks refused to buy government bonds.
• Your story comes hard on the heels of the Mail’s unpleasant attack on Ralph Miliband’s marxism. A focus on narrow mathematical modelling, which reduces everything to statistics and graphs, and which is used as propaganda to talk up stock markets and distract from the real economy of jobs and wages, is not going to encourage critical thinking about how the world works. Marxism, by contrast, is about people and the social relationships between them; about the owners of wealth and how they use it to exploit others; and how this generates both class struggle and economic crises.
Those interested can find out more at the 21st Century Marxism festival which takes place in and around the Marx Library, Clerkenwell Green, London on 2-3 November.
Crowborough, East Sussex
• Of course universities should invest in the future (Letters, 25 October). The problem is they don’t. Climate change, population growth, mass extinctions and other global problems mean that we are heading towards disaster. If we are to make progress towards as good a better world as possible – or at least avoid the worst of disasters – we need to learn how to do it. That in turn requires that our institutions of learning are rationally designed and devoted to the task.
We need universities to be devoted to helping us solve our problems of living – above all, our global problems – in more effective, intelligent and humane ways. But universities at present are devoted to the pursuit of “knowledge” and technological know-how, not to helping humanity learn how to resolve conflicts and problems of living in more co-operatively rational ways. The key crisis of our times is the failure of our universities to help us learn how to make progress towards a better world.
University College London