Stephen Marglin: Occupy Harvard, Economics and Ideology

Read it at INET (with video)
Stephen Marglin: Occupy Harvard, Economics and Ideology

Dear Harvard econ students: Everything you're being taught is wrong!

Cullen Roche over at Pragcap spells it out very succinctly: the neoclassical garbage being taught in econ departments at Universities around the country, like Harvard, is totally flawed and inapplicable to the current reality.

"All I can say is bravo. Unfortunately, I have bad news for you Harvard students – the entire neoclassical foundation upon which Dr. Mankiw is basing his work is flawed. Yes, he is teaching you out of textbooks that are based on a convertible currency system. This is largely inapplicable to the system in which we currently reside where the USA is the monopoly supplier of dollars in a non-convertible (into any metallic money) floating exchange rate system. Some might be inclined to say this is nonsense. But I assure you it is not. You know Chapter 25 of your textbook in section 9 on the loanable funds market? It doesn’t exist. You know the section in the same chapter on where he explains how the US government borrows to “finance” itself? A total myth. You know the part where he explains how the government borrows money thus “crowding out” the private sector? That doesn’t actually happen. You know the section in Part Ten, Chapter 27 on the money multiplier? Yep, that’s a myth also."

Harvard econ students walk out of Greg Mankiw's class in protest against neo-liberal economics!

Occupy Wall Street is spreading everywhere, even to the hallowed halls of Harvard University. Greg Mankiw's entire class walked out of his lecture in protest! This may be the beginning of a general revolt against entrenched neo-liberal economic bias. That would be awesome!!

Check out what the students wrote:

"Dear Professor Mankiw— Today, we are walking out of your class, Economics 10, in order to express our discontent with the bias inherent in this introductory economics course. We are deeply concerned about the way that this bias affects students, the University, and our greater society. As Harvard undergraduates, we enrolled in Economics 10 hoping to gain a broad and introductory foundation of economic theory that would assist us in our various intellectual pursuits and diverse disciplines, which range from Economics, to Government, to Environmental Sciences and Public Policy, and beyond. Instead, we found a course that espouses a specific—and limited—view of economics that we believe perpetuates problematic and inefficient systems of economic inequality in our society today. A legitimate academic study of economics must include a critical discussion of both the benefits and flaws of different economic simplifying models. As your class does not include primary sources and rarely features articles from academic journals, we have very little access to alternative approaches to economics. There is no justification for presenting Adam Smith’s economic theories as more fundamental or basic than, for example, Keynesian theory."

Check out the full letter here.