A shed full of broken tools

November 16, 2019 10:48 AM

"Mainstream economists nowadays might not be particularly good at predicting financial crashes, facilitating general prosperity, or coming up with models for preventing climate change, but when it comes to establishing themselves in positions of intellectual authority, unaffected by such failings, their success is unparalleled. One would have to look at the history of religions to find anything like it. "
posted by Lycaste (20 comments total)

“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.” ― John Maynard Keynes
posted by chavenet at 12:40 PM on November 16, 2019 [20 favorites]

Fairy tales of eternal growth are a profitable line of work.
posted by ocschwar at 12:46 PM on November 16, 2019 [7 favorites]

This book was an interesting read.

A bit off-axis from Graeber, but IMO more descriptive of the actual problem here.
posted by Heywood Mogroot III at 12:57 PM on November 16, 2019 [2 favorites]

I agree. The book is better than the review. The review seems to be more about Graeber's particular slants than Skidelsky's.
posted by JackFlash at 1:35 PM on November 16, 2019 [1 favorite]

Most people are willing to invest in stories that support their values or status.

People with wealth and power can usually afford to pay much better for such stories.

A thoughtful economist could probably work out one expected outcome.
posted by wildblueyonder at 2:37 PM on November 16, 2019 [13 favorites]

You'd think that an anthropologist would be better at actually studying the folkways of actual economists in the wild; the response has been mostly of confusion---Graeber's caricature may hit the mark for economics for in the 80s, but is totally unrelated to the research/teaching happening in modern economics departments. To take one example: the idea that modern economists are fixated on price stability to the exclusion of all else is just laughably off-base
posted by rishabguha at 10:02 PM on November 16, 2019 [5 favorites]

Graeber is quite clear about which sections of economics he's referring to. Orthodox economists, as opposed to heterodox economists. Are people really defending orthodox economics as a field? Is it being inappropriately skewered? Or is the concern that actually respectable researchers who are fully cognisant and inclusive of a wide range of different theoretical and practical approaches to studying economics are being unfairly maligned by association?

Anthropology is another field that shares widespread public skepticism and negative associations with economics. The knowledge of the field's past failures, complicity in upholding white supremacy, empire, existing class relations and so on permeates the environments I've been exposed to anthropology in. There are still countless failings, but there is some real will for change, and serious consideration of the harm done. It seems to me from the outside that within economics, a number of active phrenologists, so to speak, are still accorded respect, while the activists are variously ignored, derided, discredited and sectioned away.

To this day, economics continues to be taught not as a story of arguments—not, like any other social science, as a welter of often warring theoretical perspectives—but rather as something more like physics, the gradual realization of universal, unimpeachable mathematical truths. “Heterodox” theories of economics do, of course, exist (institutionalist, Marxist, feminist, “Austrian,” post-Keynesian…), but their exponents have been almost completely locked out of what are considered “serious” departments, and even outright rebellions by economics students (from the post-autistic economics movement in France to post-crash economics in Britain) have largely failed to force them into the core curriculum.

My university has one of these alternate deparments for political economics, established by student and staff rebellion. It's really very clear-cut, from what I can see, rich scum go into the regular economics department and go on to advocate for the conditions that will continue to enrich them and their class. It's not just the handful who go on to become to next generation of academics, it's also that it's the default for economics/law and other combinations, and so the children of the ruling class and professional-managerial class types are all indoctrinated into the common sense, rational choice delusions of orthodox economics which abstract away power relations.

from a technique for understanding how those operating on the market make decisions to a general philosophy of human life.

This is a great deal of it, right, and Graeber could have taken more time to unpack this, because I'm not going to do a great job. At least in part, it's the horrific amorality of commoditising every aspect of our existence, it's the same impulse that justifies murdering disabled people through inaction and punitive social welfare programs designed to produce rational economic behaviours.

Everything Graeber is saying seems very similar to the more positive arguments I've seen, and of course I'm sure he's forgotten more about than I've yet learnt, for economic anthropology (Wikipedia, Max Planck Institute) as a field of study.

Economic anthropology has languished for decades, a victim of influential paradigms that would deny its right to exist. First, there are those who believe that all human behaviour is explicable with the help of economic models grounded in some form of “rational choice” theory. Some, perceiving the shortcomings of narrow economic models, emphasize instead the role of institutions in solving coordination problems; it is then all too easy to explain the history of these institutions in terms of their evolutionary efficiency. There is a close affinity between these approaches (usually known respectively as “neoclassical” and “new institutionalist”). Rejecting the reductionism of such approaches, many socio-cultural anthropologists deny the very existence of “economy”, insisting that meeting material needs cannot be distinguished from other needs, which are inextricably tied to society and culture in general.

So I don't think Graeber is arguing against the existence of any good economists today, any economics deparments producing any useful work, he's arguing that heterodox economists are excluded, which is like, almost a priori true right? Is anyone arguing that many, if not most regular people's beliefs about economics are shaped not by the leading edge of economic theorists today but by the prominence still given to the remaining proponents of bullshit?

Anyhow it seems a fair critique. Economics does need to undergo radical changes, as every field does. I'm sure some are working towards that, but I think for the everyday experience of economics of a lot of people, it does seem fair to characterise the parade of reactionary clowns given bylines and media platforms as spouting something with all of the effectiveness and none of the queer glamour of astrological prediction.
posted by Acid Communist at 2:55 AM on November 17, 2019 [13 favorites]

It's funny, this FPP came up ten minutes after I read an opinion piece in my local paper about the sorry state of economics departments in this country. It strongly echoed Graeber, without quoting him directly. Now I feel more informed.
One of the goals of our relatively new Social Democratic government is to take a long hard look at the economic models used in the Ministry of Finance here. Because last time there was a Social Democratic government, they were run over buy the so-called "politics of necessity", the neo-classical models used by that department.
Some years ago, I tried to start a journal focused on that discussion, combined with a discussion on urbanism which I still think is a relevant combination. I think we failed because it was literally impossible to find (local) writers on economy who were able to do the critical thinking on the issues.
posted by mumimor at 4:22 AM on November 17, 2019 [4 favorites]

I have a sneaking suspicion that "mainstream economists" is either meaningless or misleading. Are "mainstream scientists" so positioned because there remain people willing to call themselves scientists and work for propaganda organizations either actively muddying the waters or merely providing silent cover for the obviously outlandish claims of their paymasters?

I submit that the word the author was looking for wasn't "mainstream." Potemkin economists isn't quite right, either, but is closer to being true. What do we call accountants who cook the books and provide cover for the book cookers?
posted by wierdo at 4:32 AM on November 17, 2019 [1 favorite]

Graeber is quite clear about which sections of economics he's referring to. Orthodox economists, as opposed to heterodox economists.

If he means this, he is disastrously wrong or lying. Every time he says "mainstream economists" you should substitute "monetarist macroeconomists." The alternative to his target is not most obviously weirdos like Austrians but rather: microeconomists. Econometricians. Game theorists and computational modelers. Who are together the bulk of people doing the bulk of research and teaching in nearly every econ department. Lord knows all those people can be spectacularly wrong on the regular too, but they're clearly not who Graeber is talking about. The only swipe he delivers at anyone who's not a monetarist macroeconomist is a one-sentence offhand dig at the notional psychological foundations of rational-choice work, which is silly because ~nobody believes them as psychology; it's just a convenient description of (some) goal-oriented behavior.
posted by GCU Sweet and Full of Grace at 5:12 AM on November 17, 2019 [6 favorites]

He also says something else painfully ignorant, that the assumption of utility maximization assumes that all people are greedy. Utility could mean anything: a doctor's utility could be lives saved, a newspaper firm's utility they are maximizing could be circulation, a charity's utility could be lives improved, etc.

Graeber also has the tendency to show up on Mefi or twitter and call people names who disagree with him, so....

Debt was great. I loved it. Until he started talking about something I knew quite a bit about, in which case he was laughably off base, which makes me question everything else I learned beforehand.
posted by MisantropicPainforest at 5:34 AM on November 17, 2019 [4 favorites]

Until he started talking about something I knew quite a bit about, in which case he was laughably off base

Can you specify? Thanks
posted by Reasonably Everything Happens at 5:46 AM on November 17, 2019

IIRC the last chapter reviewing the US role in the world. Henry Farrell made some critiques in the crooked timber symposium on the book.
posted by MisantropicPainforest at 5:52 AM on November 17, 2019 [1 favorite]

So is the argument that the MMT guys make more accurate predictions, or that it doesn’t matter?
posted by Selena777 at 6:19 AM on November 17, 2019

So is he attacking a straw man? Meaning that no major economics department still teaches the "assume a perfectly informed spherical consumer" type of economics attacked in the book?
posted by monotreme at 6:02 PM on November 17, 2019

More that he doesn’t understand why they do that. Models are maps.
posted by MisantropicPainforest at 6:57 PM on November 17, 2019

In these blame-the-economists threads there is a frequent defense that these criticisms are unrelated to what contemporary academic economists are up to -- reasonable, since they are often framed as about "the discipline of economics," to choose an example from the first sentence of Graeber's essay. But while those phrases are a mistake, a defense centering around the academic discipline as practiced today seems equally misplaced, inasmuch as the core critique is about the damaging effects of a type of economics that began centuries ago and is still dominant today in many, many branches of government, think tanks, businesses, and the media. The fact that this brand of economics is now less popular in many top departments doesn't really bear on the general criticism of this school of thought from its origins in Hume and Locke, through Hayek and the Chicago school, and down to even recent liberals like Krugman or Stiglitz (to stick to examples from the essay).

But more importantly, the fundamental critique is less about academic economists at all than their effects on governments and global policies, and these effects are still going strong. The article discusses this nicely in the UK context, from Locke's effects on monetary policy through Skidelsky's role in the House of Lords today, and of course more broadly in the ongoing dominance of monetarism, austerity, "neoliberalism," and the generic use of rational self-interest to further conservative aims for centuries -- irrespective of what may be going on in top academic departments these days. This extra-academic movement is due to far more than just a subset of academic monetarism macroeconomists, and is deeply tied to a stream of philosophy and later economics from Hume and Locke to Fama or Laffer or Mankiw -- as Skidelsky, Graeber Applebaum, Shiller, and dozens of others recognize. I suppose it's worth knowing that lots of scholars aren't doing it any more, but no one is fundamentally interested in the reputation of economics professors -- they are more interested in undoing the destructions wrought by many previous generations of philosophers and academics, as well as current practitioners worldwide.
posted by chortly at 7:36 PM on November 17, 2019 [3 favorites]

It's not a defense, and AFAIK it's not that economists stopped doing monetarist macroeconomics. It's just silly to generalize a specific and well-deserved attack beyond the actual target. It annoys me that he's chucking, say, Amartya Sen or Reinhardt Selten into the wood chipper with Friedman when there's no real reason to do so.

Since you seem to be familiar with political science, the problem is that he writes polemics against Straussian political philosophers but keeps saying "the discipline of political science believes strongly in a secret knowledge blah blah blah," which would of course be very silly.

To directly reply: if that's who Graeber means to attack, he should use those words instead of the ones he chose. As you've just shown, it's certainly possible.
posted by GCU Sweet and Full of Grace at 8:03 PM on November 17, 2019

I guess the criticism of Graeber is fair, and certainly understandable given the pull-quote, particularly for those who haven't read the article or book itself very closely. But my sense is that most of us are less interested in Graeber than in the target of his criticism, which is the same target as Skidelsky, Applebaum, Shilller, and a bunch of others recently. It's like getting up in arms over the etymology of "neoliberalism" by folks who largely agree that this thing, whatever you call is, is a problem. I think most of us don't disagree that there is a powerful lineage of philosophers, economists, business folks, and conservative and centrist government/policy folks who have spent centuries developing a fairly coherent set of theories about human nature and economic exchange, which (arguably) have been both empirically problematic and politically destructive. So yeah, I know more about political science personally, but personally I can't imagine getting up in arms if someone made a critique of political science that I fundamentally agreed with even if they painted it with too broad a brush and got some of the technical details wrong. It sometimes seems like the "you clearly know nothing about bump stocks" dismissal of anti-gun folks. Graeber is sometimes over-broad or mistaken in some details of his target, but the core and most of the historical claims seem both accurate, and largely agreed-upon by historians and even major economists like Shiller or Krugman.

...Though thinking about it further, perhaps there is a fundamental disagreement here about certain aspects of the blameable penumbra. Macro monetarism is clearly the core, but Graeber, Shiller, and the rest also lay a lot of the blame on a much broader set of ideas: Hume, Locke, rationality, utility, game theory, equilibria, self-interest, analytic models, and much of the rest of the lumber of what came to be called microeconomics. So perhaps there is a more substantive argument to be had about whether this is just a macro monetarist problem, or something with deeper roots in centuries of political economy culminating in the Chicago School. Anyway, I honestly don't know that much about Graeber, but I think a lot of the recent efflorescence of new books by economists and historians tend to be fairly persuasive that it's much of a piece, irrespective of whether contemporary academic economics has moved on from it, or whether it's unfair to folks like Sen to lump them in with all this.
posted by chortly at 9:00 PM on November 17, 2019 [1 favorite]

If you're complaining about austerity, you might not want to throw Krugman into the same bucket as Hayek and the Chicago propagandists given that he has been loudly complaining about and compiling evidence against the efficacy of austerity since the opening days of the great recession.

At worst he's said that maybe at some future date after reaching a full recovery that it might be necessary or useful.
posted by wierdo at 12:09 AM on November 18, 2019