Do a YouTube search for “Milton Friedman.” Most of the hits will be speeches mixing economic theory with political philosophy. You’ll see Friedman talking about the value of greed, for example, or holding forth on socialism versus capitalism. Most entertaining is the series of videos titled “Milton Friedman schools young idealist,” in which young, hippie-looking kids stand up and challenge the old man’s capitalist values, only to be hit over the head with Econ 101.Quartz
As an econ blogger, I get the sense that this is exactly how many Americans still think of economists—as self-appointed defenders of the free market, spinning theories to show that greed is good. Watching those old Milton Friedman videos, I wonder if that picture might have been accurate in the 1960s and 1970s. But some big things have changed in the field of economics, and America should know about them. Three big changes stand out in particular: Econ today is more data-driven, far less politically conservative, and in general much more like engineering than it used to be.
Economists used to be the priests of free markets—now they’re just a bunch of engineers
Noah Smith
2 comments:
That's a strange perspective, but it's because Smith is so young. For him, doctrinaire free market mania among economists is an olden days phenomenon that preceded the current mania for status quo technocracy. For me, it's a perverse counterrevolution that followed a long period in which economists were actually progressive and helped create the moderately socialized and egalitarian 20th century following the ravages of the gilded age and roaring 20's capitalism. The present generation comes in as spectacularly conservative on my own ideological radio dial, but feels itself less so by comparison with its more strident teachers.
The economics profession of 2014 is not a group of ideological revolutionaries. They don't need to be, since the neoliberal revolution and Great Rightward Thrust was so successful. Instead they have a strong preference for the preservation of established forms of economic power and social authority. Dramatic socioeconomic change strikes them as the dangerous ravings of utopian wild men. They look around in an environment filled with grotesque economic oppression, exploitation, predations and cruelty, and can come up with nothing but engineering tweaks.
I'm rather offended that anyone would compare economists to engineers. It's like comparing astrologists to astronomers.
Example,
Engineer A says ones thing, Engineer B says another. An experiment is done, Engineer A is proven correct and Engineer B changes his mind.
Paul Krugman says loanable funds is right, Steve Keen says it's not. There actually is a correct answer. Bank of England writes paper describing how lending actually works. Do any economists change their mind?
Economics is no where near engineering. As far as I can tell, only the post-keynesians and dean baker really understand that the sectors balance (1-1=0), any engineer can understand that. Energy put into one system came from another system, always balances..
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