Rob Johnson at the Institute for New Economic Thinking asks a deep and important question: does the economist serve powerful interests or society?
The answer seems clear-cut. Economists today primarily serve the needs of powerful interests at the expense of society in general.
To answer this, Johnson peals back the surface of overt corruption to explain how the problem goes far beyond that. It was not that economists were all on the take leading up to the global financial crisis, Johnson says, but that those whose visions aligned with powerful financial interests “were used as marketing vehicles, and they were not adequately skeptical as scientists of what the flaws in their vision might be.”
“The world is always uncertain,” Johnson continues, “so when people become anxious, they want the expert to tell them what is going to happen.” The problem is that these experts don’t shoulder much of the risk of being wrong – or of selling confidence when humility is called for – and it is society that ultimately pays the full price of their deception.
Yet many economists don’t even see the problem. They don’t know – or don’t want to know – that they are selling snake oil and that the abstract precision of their finely tuned mathematical models doesn’t hold up to the many contingencies of the real world.
The solution Johnson proposes resonates with me: change the way economics is taught. Rather than use principles of economics to indoctrinate, use it so study the philosophy of economic science. Help students realize that an interesting and useful economics deals with politics and institutions and power and the good society. Ethics cannot be completely absent from the toolkit of the economist. Otherwise, they end up serving the interests of the powerful at the expense of society.
Then we can get to the real issue that the profession must confront:
Economists. What – and who – are they good for?