Click amount to donate direct to CounterPunch
  • $25
  • $50
  • $100
  • $500
  • $other
  • use PayPal
Support Our Annual Fund Drive! We only ask one time of year, but when we do, we mean it. Without your support we can’t continue to bring you the very best material, day-in and day-out. CounterPunch is one of the last common spaces on the Internet. Help make sure it stays that way.
FacebookTwitterGoogle+RedditEmail

The Dismal Science

by GREGORY TRAVIS

At first, I was horrified to learn that Sweden’s Royal Academy of Sciences had gone ahead this year and awarded a prize in Economics. That horror abated some when I learned it had been awarded, for the first time ever, to a woman. And it abated more when I understood that she was a faculty member here at Indiana University, a fact that replaced much of the horror with pride.

But what really turned things for me, what allowed that final sigh of total relief, was the revelation that the prize for Economics hadn’t gone to an economist at all. IU’s Elinor Ostrom is a political scientist.

Why was that important? Because the state of the dismal science is dismal. It’s more than dismal, it’s dreadful. It’s embarrassing.

Half of the discipline’s practitioners think one way. The other half think exactly the opposite. I’m referring, specifically, to the wisdom and guidance being meted out (and, yes, I do mean meted because it sure feels like punishment) with regard to our economic future.

Should we cut government spending or should we increase it? Should we raise taxes or should we lower them? Should we enact trade protections or should we ratify more trade treaties? Bail out our largest and most important industries or let capitalism’s sickle cut them down for a bonfire of creative destruction?

Pick a hundred economists at random and ask them any of those questions. Half will answer one way, the other half the other way.

***

This isn’t funny. It’s not just a manifestation of a healthy dialectic within the profession. It’s not an exposition on the sovereignty of the individual opinion. It’s chaos.

We simply wouldn’t put up with it from any other discipline. If you asked a hundred physicists if an object in motion would stay in motion unless acted upon by a force, half of them wouldn’t say “yes” and the other half “no.”

If you asked a hundred astronomers if, tomorrow, the sun would rotate around the earth or the earth around the sun, half of them wouldn’t give you one answer and the other half the other.

And lest you think I’m demanding too much of a social science by comparing its lack of orthodoxy with that of the hard sciences, think again. Imagine if we asked a room full of, umm, political scientists if consent of the governed was an important characteristic of democracy — and they split down the middle?

We’d be horrified. What’s more, there’d be a movement immediately to disband the political science department on a charge of irrelevancy.

But, for some reason, we’re willing to put up with that in Economics — at least in the present. And I can’t figure out why.

***

I might not be quite so spun up about this if the circumstances weren’t so deadly serious. The nation and the world are deep in what may turn out to be the biggest and worst economic downturn, ever. Forget green sprouts, forget a rally on Wall Street. The economy is still hemorrhaging employment, and it’s doing so in a way that forebodes a patient who might get better, but never gets well.

I’ve got a suggestion, however, to try and get us better out of this mess. It’s a simple exercise in Einstein’s definition of insanity: doing something over and over again in the hopes that it will eventually produce a different outcome.
Luckily for us, the bicameral split in the economics profession cleaves upon historic lines. As for presumptions of what policy initiatives should be undertaken to steer the world out of trouble there are two contradicting answers.

One set would have us turn right, back to the nostrums and shibboleths of the past 30 years. Rightward to Reaganism, deficit-financed tax cuts, trickle down prosperity, a financial sector unshackled from the controls imposed on it the last time it spectacularly melted down and capital free to emigrate away from a labor force that cannot. Laughing all the way to the Laffer Curve.

But that is indeed insanity, as is evident to anyone capable of remembering even the most recent history, a history in which those very same nostrums and shibboleths exploded spectacularly, launching us into the trouble all around us.

The other set would have us turn left, toward an economy jumpstarted by stimulus, enabled by a public sector that stepped into the ring when the private sector had to step out and take a breather. A turn not experimental, but proven by the lessons of World War II, a massive $5 trillion dollar stimulus in which half of the entire economy was dedicated to no more productive act than making things that blew up other things or making things that got blown up by other things.

But the thing is, it worked. Spectacularly. Pulling the nation, and the world, out of the tentacles of the Great Depression and setting the foundation for 50 years of peace and prosperity.

***

I’m not suggesting that we start another world war just to get the machinery of civilization running again. But I am suggesting that we use that example to inform us of what worked when and to give us the courage of our convictions to mount a similar campaign, at least in terms of scale, today.

I’m suggesting that the economists are evenly split on what to do, and that’s depressing. But the split is a real and informative one: half of them are exactly wrong and the other half is exactly right. We just need to understand which half to listen to.

And now you do. Congratulations, again, Dr. Ostrom

GREGORY TRAVIS writes a biweekly column called “CIVITAS” for The Bloomington Alternative, www.BloomingtonAlternative.com, where this article originally appeared. He can be reached at greg@littlebear.com.

 

 

More articles by:

2016 Fund Drive
Smart. Fierce. Uncompromised. Support CounterPunch Now!

  • cp-store
  • donate paypal

CounterPunch Magazine

minimag-edit

September 27, 2016
Louisa Willcox
The Tribal Fight for Nature: From the Grizzly to the Black Snake of the Dakota Pipeline
Paul Street
The Roots are in the System: Charlotte and Beyond
Jeffrey St. Clair
Idiot Winds at Hofstra: Notes on the Not-So-Great Debate
Mark Harris
Clinton, Trump, and the Death of Idealism
Mike Whitney
Putin Ups the Ante: Ceasefire Sabotage Triggers Major Offensive in Aleppo
Anthony DiMaggio
The Debates as Democratic Façade: Voter “Rationality” in American Elections
Binoy Kampmark
Punishing the Punished: the Torments of Chelsea Manning
Paul Buhle
Why “Snowden” is Important (or How Kafka Foresaw the Juggernaut State)
Jack Rasmus
Hillary’s Ghosts
Brian Cloughley
Billions Down the Afghan Drain
Lawrence Davidson
True Believers and the U.S. Election
Matt Peppe
Taking a Knee: Resisting Enforced Patriotism
James McEnteer
Eugene, Oregon and the Rising Cost of Cool
Norman Pollack
The Great Debate: Proto-Fascism vs. the Real Thing
Michael Winship
The Tracks of John Boehner’s Tears
John Steppling
Fear Level Trump
Lawrence Wittner
Where Is That Wasteful Government Spending?
James Russell
Beyond Debate: Interview Styles of the Rich and Famous
September 26, 2016
Diana Johnstone
The Hillary Clinton Presidency has Already Begun as Lame Ducks Promote Her War
Gary Leupp
Hillary Clinton’s Campaign Against Russia
Dave Lindorff
Parking While Black: When Police Shoot as First Resort
Robert Crawford
The Political Rhetoric of Perpetual War
Howard Lisnoff
The Case of One Homeless Person
Michael Howard
The New York Times Endorses Hillary, Scorns the World
Russell Mokhiber
Wells Fargo and the Library of Congress’ National Book Festival
Chad Nelson
The Crime of Going Vegan: the Latest Attack on Angela Davis
Colin Todhunter
A System of Food Production for Human Need, Not Corporate Greed
Brian Cloughley
The United States Wants to Put Russia in a Corner
Guillermo R. Gil
The Clevenger Effect: Exposing Racism in Pro Sports
David Swanson
Turn the Pentagon into a Hospital
Ralph Nader
Are You Ready for Democracy?
Chris Martenson
Hell to Pay
Doug Johnson Hatlem
Debate Night: Undecided is Everything, Advantage Trump
Frank X Murphy
Power & Struggle: the Detroit Literacy Case
Chris Knight
The Tom and Noam Show: a Review of Tom Wolfe’s “The Kingdom of Speech”
Weekend Edition
September 23, 2016
Friday - Sunday
Andrew Levine
The Meaning of the Trump Surge
Jeffrey St. Clair
Roaming Charges: More Pricks Than Kicks
Mike Whitney
Oh, Say Can You See the Carnage? Why Stand for a Country That Can Gun You Down in Cold Blood?
Chris Welzenbach
The Diminution of Chris Hayes
Vincent Emanuele
The Riots Will Continue
Rob Urie
A Scam Too Far
Pepe Escobar
Les Deplorables
Patrick Cockburn
Airstrikes, Obfuscation and Propaganda in Syria
Timothy Braatz
The Quarterback and the Propaganda
Sheldon Richman
Obama Rewards Israel’s Bad Behavior
FacebookTwitterGoogle+RedditEmail