Philip Pilkington: Neoclassical Economics and the Foreclosing of Dissent – The Inner Death of a Social Science

By Philip Pilkington, a writer and journalist based in Dublin, Ireland. You can follow him on Twitter at @pilkingtonphil

Convictions are more dangerous foes of truth than lies.
– Friedrich Nietzsche

Heterodox economists – that is, those that do not subscribe to the neoclassical research program – often claim that they are marginalised within the profession. Anyone who has had dealings with academia would instinctively take such complaints with a pinch of salt. Indeed, academic quarrels often have as much to do with who said what at a dinner party as they have to do with questions of high theory. Academics, for better or for worse, are often characterised by their independent-mindedness… and with it: their stubbornness. This often leads them to partake in intellectual factionalism.

Personally, I’ve come across some of the very worst of this and it has always turned me off. Often it appeared to me similar to that joke in Monty Python’s ‘The Life of Brian’ about the Judean People’s Front . That is, I saw it as simply factionalism for the sake of factionalism, which often seemed to have more to do with personalities than anything important.

However, when I started studying economics and talking to heterodox economists, it quickly struck me that something wholly different was going on. Yes, there appeared to be the old factions that you would find elsewhere in academia – in economics these were characterised by what are called in the US the ‘freshwater school’ and the ‘saltwater school’, which translates to: ‘hardcore neoclassicals’ and ‘not-so hardcore neoclassicals’ – but between these schools there seemed to be a sort of solidarity that I hadn’t really encountered in other social science disciplines. I’m not the only one who thinks so. Leading neoclassical Greg Mankiw wrote the following:

An old adage holds that science progresses funeral by funeral. Today, with the benefits of longer life expectancy, it would be more accurate (if less vivid) to say that science progresses retirement by retirement. In macroeconomics, as the older generation of protagonists has retired or neared retirement, it has been replaced by a younger generation of macroeconomists who have adopted a culture of greater civility.

At a superficial glance one might think that economics have succeeded where other disciplines had failed. But all is not so rosy; in actual fact this ‘civility’ was won by a de facto exclusion of literally anyone who disagreed with certain precepts from the upper echelons of the profession. Such exclusion one would rarely encountered outside of a cult or a religion, and it was cast upon a number of groups who make up a fair amount of the profession (broadly speaking we could refer to the neo-Marxians, the Austrians, the neo-Ricardians and the post-Keynesians – although there is much overlap between the different groups). One could imagine the Monty Python crew’s Judean People’s Front and their People’s Front of Judea meeting in similar formal gatherings or sharing information about their common goal – but not the orthodox and the heterodox economists. This isn’t just whisperings behind someone else’s back at a conference; this is a ring-fencing, a wholesale exclusion of anyone that dissents.

“Why are you Doing This?”

As I looked into it more and more, two key points emerged that made sense of the schism. First of all, the reason that the heterodox had been left by the wayside was because they felt that many of their arguments completely undermined the entire neoclassical research program. Thus the neoclassicals had, at some point in history, made a fairly violent institutional attempt to supress dissenters. This actually makes a lot of sense if you understand that many neoclassicals see themselves more akin to hard scientists than to social scientists – an idea most scientists and philosophers of science deride, but the neoclassicals just ignore them (starting to see a pattern here?).

This brings us to point number two – which, to be honest, shocked me a little. I got a strong impression that there was a subtle bullying of sorts going on within the profession – a sort of fascistic atmosphere through which rules of behaviour and thought were enforced. Indeed, I increasingly got the impression that this was precisely what allowed for the ‘civility’ that Mankiw referred to – the exclusion of an out-group being a well-known prerequisite among social psychologists for strong, quasi-totalitarian in-group formation.

This phenomenon was hard to pinpoint and I was reluctant to write anything based on the complaints of those who saw themselves as victims (or even those in the public eye who vouched for them). But recently I stumbled upon an anecdote from a neoclassical economist that highlighted precisely this very dynamic.

The following anecdote is told by Dani Rodrik who, although part of the neoclassical ‘club’, nevertheless maintains more cautious views on a number of issues of doctrine than many of his colleagues. It is taken from a blog entitled ‘Is neoclassical economics a mafia?’ which is a response to a piece written by Christopher Hayes and published in The Nation in 2007 about the exclusion of heterodox economists in the profession:

Hayes makes a number of good points about how ideology permeates a lot of thinking by orthodox economists. Anybody who strays from conventional wisdom is in danger of being ostracized. Some years ago, when I first presented an empirical paper questioning some of the conventional views on trade to a high profile economics conference, a member of the audience (a very prominent economist and a former co-author of mine) shocked me with the question “why are you doing this?”

Rodrik goes on to reflect that the methodology of neoclassical economics has served him well and he has never found it constricting. That’s fine – but is he not moving the goalposts here a bit? It seems that to move the conversation from an anecdote about a very strange sort of censorship being imposed through a pretty creepy sort of groupthink to reflecting on the relative merits of said groupthink is to miss the point entirely. If a cult member related to you a story where someone clearly dictated to them, in a strange, indirect and suffocating fashion, what they should and should not be allowed talk about (remember, Rodrik was talking about empirical research here!) and then moved on to tell you about the relative value of the cult’s belief system would you not feel a bit alienated? Would you not think that the person’s scepticism had been almost wholly absorbed into the cult mind-set – then sanitised, sectioned and channelled into assent? Very Orwell.

Perhaps readers will think me biased because I don’t subscribe to neoclassical methodology and have often attacked it in the past, but Rodrik’s blog post strikes me as alienating and weird – and I invite readers to read it carefully and judge for themselves in this regard. As heterodox economist Matias Vernengo put it in response to this anecdote:

Clearly his co-author was concerned with the effects that being critical of free trade might have on Rodrik’s career. Rodrik’s co-author is, most likely, just a good friend, but his question reveals a lot about the dark corners of the edge of the profession.

The media has occasionally picked up on this general weirdness too. In addition to Hayes’ piece cited above, Playboy recently ran a piece on exactly this topic which Bill Black responded to over at Bezinga. Then, of course, there was Charles Ferguson’s excellent film ‘Inside Job’ which dealt with one side of this issue. In fact if you think about it, it is quite unusual that the media would weigh in on factional fights in academia. But if the above is taken into account it should not be hard to understand why the economics profession might pique the media’s interest. Basically, it’s a pretty damned weird place!

The fact is that there is something pretty nefarious going on in economics departments across the Western world, something that is making them resemble more so a church or a cloister than an academic institution. Adherents such as Mankiw call this shift – which seems to have taken hold over most of the last generation of economists – one of ‘civility’ to one’s fellow economists, but when looked at from without it more so resembles the formation of a powerful sect which violently demarcates the lines of accepted discourse to ensure that their hegemony is maintained.

An Intellectual Hierarchy

Of course, simple pushiness alone would not be sufficient to maintain such an institutional structure intact – institutional defences of various types must exist to prevent intruders from gaining entry. And when we scratch the surface of the economics profession this is precisely what we find.

The structure is maintained for the most part through a hierarchy of journals. In order to secure a job in economics departments that are dominated by neoclassicals – which is most of them – a person must have published in one of these “leading” journals. Yet, in order to do so a person’s work must also be undertaken within the neoclassical paradigm. Any work that does not conform to this paradigm is outright rejected by the editors of these journals.

Economics professor Steve Keen summarised this well in his book ‘Debunking Economics’:

Up until the early 1970s, non-neoclassical authors were regularly published in the prestigious journals of the profession – for example, a major debate over theories of production and distribution between neoclassical and non-neoclassical economists, known as the ‘Cambridge Controversies’, largely occurred in the American Economic Review, the Economic Journal and the Quarterly Journal of Economics… However, by the mid-1980s, these and their companion major journals, the Journal of Political Economy, the Journal of Economic Theory and many other minor journals had become bastions of neoclassical thought. Papers that did not use neoclassical concepts were routinely rejected – frequently without even being refereed. (P. 8-9)

This side-lining of critics not only ensured that it would be difficult for them to find employment if they did not fall into line with the dominant research paradigm, it also stymied any real and fundamental dissent with that paradigm. Later in his book Keen lays out a critique of the neoclassical theory of competition and relates how it was examined and rejected by a number of the editors of neoclassical journals – including the Economic Journal and the Journal of Economics Education. The responses Keen received from referees were occasionally bizarre; one of them basically claimed that since Keen’s criticism was contrary to the dictates of equilibrium it was irrelevant.

The hierarchy of journals is also used indirectly as a means to put pressure on any non-neoclassical departments that have managed to form against the odds. The fate of the economics department in the University of Notre Dame is a case in point. The department had long been a bastion of heterodox thought but came under pressure from administrators who complained that those within the department were not publishing in any of the “leading” journals. Eventually, some neoclassicals were hired to boost the supposed credibility of the university and the economics department was split in two. Soon after it was announced that the heterodox half of the department was to be dissolved.

The timing couldn’t have been better. The dissidents were turfed out in 2009, shortly after the 2008 financial crash and the resulting public backlash on mainstream economics. One heterodox scholar from the department summed it up well:

“In light of the crash of the economy, you would think there would be some humility among economists, some openness to new approaches,” says Charles K. Wilber, a professor emeritus of economics at Notre Dame. “There’s not a lot.”

But as far as administrators were concerned the falsifiability of neoclassical economics – which could not have been given a better test then 2008 – was not at issue. The desire to have their economics department “rated” through the system of journals was far more important… for their bottom line, presumably. Professor of economics Fred Lee summed up the situation well in a paper entitled ‘Ranking Economics in a Contested Discipline’:

The Notre Dame case dramatically illustrates how bibliometric (and peer review) based methods can be used to silence dissenting voices and to render invisible heterodox ideas and departments in a contested discipline such as economics.

The neoclassicals for their part are flippant about these problems. For the most part they assume that they hold a doctrine of Absolute Truth and that anyone who disagrees has simply made an error of some sort. Some of them have the audacity to refer to their doctrines as proof that the economics discipline itself is perfectly functional. Harald Uhlig, chair of the economics department at the University of Chicago, responded to Business Week in a particularly bizarre fashion when asked what he thought of the structure of the economics profession and the training of PhD students.

Above all, I do not believe in central planning. What is true in private markets is true in PhD education as well: It is good to see different places try different approaches, to let the PhD students decide where they want to be educated, and to let the marketplace for future scientists decide what works and what does not.

Thus, because Uhlig “believes” in perfectly functional private markets and because, in his opinion, these can also be said to exist in academia then if some ideas are better than others they will become dominant. Of course, Uhlig cannot consider that institutional power may play a role in what ideas PhD students choose to study because the ideas he espouses do not take the role of institutional power seriously. Like a man who tells his psychiatrist that he is indeed God’s messenger on earth because, being God’s messenger, he cannot entertain false ideas, Uhlig summons his own ideas as a sort of “meta-reference” in order to “prove” that these ideas are indeed correct. As one commenter on the article put it:

You’ll never hear any scientist say “above all, I don’t believe in [insert something his science is supposed to be studying]”. When economists become ideologues, any pretence of science goes out the window.

Look, personally I don’t like neoclassical economics. I think, institutional framework aside, it’s founded on quasi-theological principles (teleology/equilibrium etc.). Nor do I think it conforms to real scientific methodology. Not to mention the fact that, contrary to what some of its more naïve practitioners assert, it almost certainly acts as an ideology for the powers-that-be. However, all this aside I hope that people will believe me when I say that something weird is going on in the economics profession and has been going on for over 30 years; something that I strongly believe it would be in the educated public’s interest to scrutinise closely. Perhaps this wouldn’t be so important if economic discourse were not today the language of power in much of the world. But it is. And for these reasons, the conduct of the economics profession should be subject to some sort of serious outside scrutiny whether informal or – preferably, in my opinion – formal.

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  1. Timothy Gawne

    The following is an excerpt from the forthcoming science fiction novel “Space Battleship Scharnhorst and the Library of Doom.” It is about as relevant as anything in this day and age…

    Old Guy suddenly accelerated.

    “Race you back to the main road! Last one there is a neo-liberal economist!”

    Grasshopper was going to protest that that wasn’t fair, as Old Guy had taken a head start, but he decided that that would sound petulant, so he accelerated as well and joined in the race. Old Guy had a strong lead, but Grasshopper was faster and more nimble. On the other hand Old Guy could smash through boulders over a meter wide that Grasshopper had to swerve to avoid. On yet another hand, larger rock formations that Old Guy might have tried to crash through in real combat would damage him enough that he would avoid them now, yet the smaller cybertank could thread through some of the smaller openings between them. Grasshopper worked his optimization strategies: this looked to be an interesting race after all.

    “Why do people from your time always poke fun at the neo-liberals? Before the humans became sane they had developed any number of corrupt and/or vile philosophies. Nazism, Stalinism, Behaviorism, Social Darwinism, Islamofascism, the Spanish Inquisition, the North Korean hereditary monarchy, NIH study sections – why this obsession with neoliberalism?”

    Old Guy smashed through a boulder field that Grasshopper had to swerve to avoid, and the older cybertank extended his lead.

    A good question. Partly I think it is just that the neo-liberals had the bad luck to be the last vile ‘ism’ on record, and it’s always the last bogeyman that you remember. But also they truly were vile. They were the only ‘ism’ that conquered all of civilization, and the only ‘ism’ that came close to exterminating humankind. And I was there. And I saw what they did. And I hate them. My only regret at their passing is that I will not have the opportunity to kill them again.

    The racing cybertanks came to a more broken terrain that favored the smaller cybertank, and in an inspired bit of high-speed maneuvering, Grasshopper took the lead.

    “So what exactly was it about their philosophy that you find so repulsive?”

    Another good question. But it wasn’t really a coherent philosophy as such. It was more a way of thinking, a contempt for the truth and other people, the ultimate evolution of might makes right. Consider Nazism. Aryans are the master race, and all other races can be killed or enslaved as the Aryans see fit. Not a very nice philosophy, at least if you are not an Aryan. But with the Nazis you knew where you stood. The neoliberals were an entirely different order of evil.

    The two cybertanks had entered a clear zone, and Grasshopper was starting to leave Old Guy behind.

    I suppose the neo-liberal philosophy could best be summed up by their rallying cry: the freedom to choose to own slaves.

    “But that doesn’t make sense. Freedom to choose is logically incompatible with slavery. And they never said that.”

    Indeed. They would claim to be all for freedom, and against slavery. But if someone was profiting from owning slaves, they would fight tooth and nail to protect them, because any attempt at restricting the profits of slavery was seen as an intolerable corruption of the sacred free market. It was how they operated. Depending on what their rich patrons wanted at the time, sometimes they were all for free trade between the old nation states, and sometimes they demanded that the wealthy have the ‘freedom’ to restrict trade. It did not matter that what they said made no sense, or was logically incoherent, or at variance with reality. They never apologized, never explained, but only acted with total arrogance and self-confidence.

    So it was like George Orwell’s ‘Doublethink’ in his novel “1984”?

    Ah, I see that they still teach the classics in cybertank school. George Orwell was a great man: intelligent, skeptical, decent. But not even his imagination could encompass the full corruption of neoliberalism. In his novel Orwell imagined that when the elites wanted to change history, they would send armies of scribes into the libraries to re-write history overnight so that everything was consistent. The neoliberals were so much more efficient. They simply ignored the library records and proclaimed whatever nonsense was the word of the day with full authority. Do you know the fable of the Emperor’s new clothes?

    At this point Grasshopper had developed an almost insurmountable lead in his race with Old Guy, but they still had a few dozen kilometers to go.

    “Yes, I know the fable of the Emperor’s new clothes”

    No you don’t. Once there was an Emperor whose advisors claimed to have sold him a suit of clothes so fine that they were invisible and untouchable.

    “I know this story.”

    Stop interrupting your elders. The Emperor paraded naked through the streets of his capital city and nobody was willing to tell him that, in fact, he had no clothes on.

    “This is boring.”

    No it’s not. A little girl remarked loudly and publicly “That man has no clothes on!” This made the Emperor very angry, and he executed the little girls’ entire family, and made her a slave who spent the rest of her short miserable life cleaning out latrines and regretting her folly before dying diseased and crippled and miserable. Others were encouraged by her example, and loudly proclaimed the wonder and beauty of the Emperor’s new clothes.

    “That’s not how the story goes!”

    You know the fairy tale. I know the real version. I was there. I saw it. And if I am not mistaken, you have now won our little race. You are truly a fast and wily cybertank.

    1. pws

      “My only regret at their passing is that I will not have the opportunity to kill them again.”

      This is the best part of the story. I also like the corrected Emperor’s New Clothes story, which is very accurate.

    2. Binky Bear

      Islamofascism is a foolish term; fascism is defined as the combination of state and corporate power. Islamic fundamentalism in most cases is exclusive of corporations and outside the reach of a state, save for Saudi Arabia. It is a propaganda term and a slur used by propagandists and fabricators. Hate Islam, fine; hate fascism, great! Borrowing imbecilic self-contradicting terms that are simply substitutes for vulgar bigotry and bias is a failure in argumentation.

      1. Matt

        When the Iranian revolutionary guard run X percent of the Iranian economy, and the Egyptian military corporations run Y percent of the Egyptian economy it would seem fascism is an appropriate term for some cliques.

        1. Tantalizing

          We, the West, were blindsided by the GFC largely because our mainstream economists kept reassuring us that everything was wonderful. 
          Our leading economists were and are trapped in a world that neither knows nor understands Marx. 
          In other words, they don’t understand Capitalism, though they present themselves as experts. So this essay, thought bit academic, is an interesting investigation into the mechanism by which informed debate on a life-and-death subject is silenced in a “free” society. 
          You will find VASTLY greater breadth of debate on this subject in China, which IS familiar both with Marx’s criticisms AND with Western capitalist thinking.
          The Chinese even employ, at great expense and at their top universities, caustic critics like Professor Michael Pettis at Peking University, whose widely-published articles constantly and loudly criticize the Chinese Government and its economic policies. 
          A former hedge fund manager, he has no sympathy for the government, its aims, or its accomplishments. 
          But China pays him one of the countries’ highest academic salaries, give him dream working conditions and elite graduate students precisely so that he will continue to challenge their post-Marxist orthodoxy.
          Not us.

    3. psychohistorian

      Nice story comment to a great posting.

      My added perspectives to your story would be the concepts of private ownership and ongoing, accumulating, inheritance law. Maybe it is its own story but one that needs to be told like your’s.

    4. allis

      David Graeber notes in “Debt,” p203-4, that the Roman concept of freedom originally meant not to be a slave, but that the meaning of the word “libertas” changed: “jurists gradually redefined libertas until it became almost indistinguishable from the power of the master.”
      Private property is the “freedom” to do what I want with it, without outside interference. With property comes “dominium.” One man’s rights or freedom lessens another’s libertas. One might say that libertas is the right to treat another human being as a mere tool (employee) for one’s own ends. Neo-classical economics seems to see this as a good thing; perhaps it is, but we should understand what it is that we’re doing as a people.
      David Graeber has given us a history of debt; Stephen Zarlenga has given us “The Lost Science of Money.” We now need a history of servitude, and perhaps then we will understand the roots of neo-classical ideology.

    5. nonclassical has been no accident that “neo-classicals” aligned themselves with authoritarian military force…

  2. Jessica

    The situation is more extreme in economics – clearly a field with close connection with politics. However, I think that in America academia in general has become more uniform and more conformist. Because more of the funding is corporate and he who pays the piper calls the tune, because the movement against the US war in Vietnam highlighted the role of academia as a source of dissent and counter-moves were made to root this out, and because in the fields not considered useful by corporations (ie most humanities), the competition for positions has been cut-throat, which has given those in power within those departments more power over their juniors.
    One section of Lee Smolin’s book “The Trouble With Physics: The Rise of String Theory, The Fall of a Science, and What Comes Next” shows how orthodoxy within physics has become more suppressive of alternative ideas, even though there are no direct political implications (quite unlike economics).
    In short, both the media and academia have been more thoroughly integrated into the corporate scheme of things. Economics is just a more egregious example.

    1. Bill

      As a professional physicist I feel compelled to object that you are misusing the analogy between economics and physics, as well as the Lee Smolin reference. Smolin is referring to areas within physics about which there is much confusion as to what are the correct ideas, and even the correct facts. But there are other areas of physics that are very well understood and whose guiding theories are firmly established and wholly non-controversial. Two well-known examples among many are Newtonian mechanics and Maxwellian electomagnetism. Although these theories have limitations, within the domains of phenomena to which they apply they work so well that no sensible physicist would waste time and effort trying to overthrow them; there are enough mysteries elsewhere in the physical universe to pursue. If economics is a science, it too should have areas that are similarly well-established both factually and conceptually. But if economists cannot even agree about that proposition, their discipline is in trouble indeed.

      1. Tschäff Reisberg

        In summary there are two two disturbing trends

        1) Ideology masked as science. Little time to no time is spent on discussing the social implications of economic doctrine, and a whole lot of time spent on finding where MC=MR and calculating dead weight loss.

        2)Pseudoscience masked as science. Most econ students don’t have hard science backgrounds and don’t know how to write a quality scientific research paper. It’s not taught in most science classes either, it’s just something you pick up over the years from reading literature. I suggest all professional economists read what Richard Feynman said about it:

      2. MacCruiskeen

        I was tangentially involved a squabble between two groups of astrophysicists over something that would seem quite obscure to most people: the variability of quasars acting as gravitational lenses. People’s careers were questioned for reasons not entirely due to the quality of the science (in the end, the original dataset (which I had hand in creating) was confirmed as correct). Weird academic infighting happens everywhere, and the practice of science involves people being people, but in real science, eventually the data wins out.

    2. jake chase

      I don’t know about physics, but what makes economics ridiculous is the perverse determination to deny all contributions of the only three giants in the history of economic thought: Marx, Veblen and Keynes. An intelligent layman can read thoughtfully in all three and understand at least 98% of economic truth. The remaining 2% is simply a waste of time.

      1. 98 should be plenty

        Jake, in your view which works by those three writers would be best to begin with?

        1. jake chase

          Marx- book I of Capital. I would ignore the rest.

          Veblen- Theory of Business Enterprise

          Keynes- Essays in Persuasion, if you can find it. There is a good deal of mathematical rigor in the General Theory, unnecessary to the argument. Treatise on Probability is excellent, again lots of difficult maths. Be careful reading things written about Keynes. The idiots got control of his work before the ink was completely dry. Anything he actually wrote is excellent.

          1. stick

            Ignore the rest?!

            While I agree with your basic assertion, you really can’t understand what Marx actually does in Capital without understanding his larger project.

    3. Sandi

      According to Charles Ferguson’s Predator Nation, it isn’t merely the funing schools get from corporations, per se; it is that many economists now also serve as “expert witnesses” for various corporate intesests, sit on their boards, take very nice honorariums for speeches, revolve through the doors of government and even the financial industry, and back to academia. The conflicts of interest are multifaceted and almost totaly non-transparent.

      1. LeonovaBalletRusse

        “Love of money” replaced “love of knowledge” in academia for a certain purpose; this corruption of academia surely was intentional. Hasn’t it worked like a charm? “Rents” from chumps enticed into the “college/university experience” for Endless Corporate Suck have grown exponentially. Why else would Paul Tudor Jones care about “change” at his “alma mater?”

  3. Hugh

    Economics largely functions as a propaganda arm of our kleptocratic elites, giving them intellectual cover for their looting. Among economists, I know of exactly none that make kleptocracy the focus of their study. A few mention it and a few others, like Bill Black, talk about criminality, but that’s it.

    Sure, the neoclassicals of whatever watery persuasion are paid charlatans, but how much better are the heterodox economists who fail to recognize kleptocracy as the economic paradigm of our times? And just because you are heterodox doesn’t mean you aren’t neoliberal. Many of the Austrians would qualify as neoliberal and a fair number of the MMTers as well. When economists start taking kleptocracy seriously, maybe I will start taking them seriously, but not until then, and it’s not something I’m holding my breath on.

    1. allis

      Kleptocracy is a system whereby an elite sets up “instruments” and “institutions” to enable it to extract tribute and hold on to it.

      It’s the method of “accumulation,” what Carroll Quigley in his “Evolution of Civilizations,” notes is the foundation of all civilizations.

      Forget about cherchez la femme; seek how tribute is collected, held on to, and justified.

    2. Me

      “Economics largely functions as a propaganda arm of our kleptocratic elites, giving them intellectual cover for their looting.”

      I agree with this on the whole, but I think the left, ecologists, environmental scientists and the like need to have a much larger role in the field. Whether we like it or not, economics is an important field of study. Abandoning the field of study and simply pointing out that the field is run by ideological fanatics who have an aversion to reality basically gives those fanatics a monopoly as far as crafting policy and creating theories and ideas.

      Having said that, I have dealt with this a little myself. I took a class last fall in environmental economics and would like to study the field at the graduate level (provided I can get the money together). I had an idea for a paper based on Piero Sraffa’s ideas. My teacher reacted pretty negatively when I artiulated the idea for my paper. Not because my logic wasn’t sound, but because he considered what I was saying to be dangerous. I did some more research on what was called the “Cambridge Capital Controversy” and it made much more sense why he reacted as he did. Basically, critics said that the way the neoclassical economists thought of capital was logically inconsistent. Almost everything they think rests on their conceptualization of what capital is. If you take that away, the whole thing falls apart. Well, Sraffa and economists like Joan Robinson won the debate, which even the defenders of neoclassical economics (like Paul Samuelson) admitted. I mention this because the alternatives then and now are not analyzing economics in regards to individuals or enterprises in “perfectly competative markets” or whatever, but classes, power relations.

      Economists like Kalecki did deal with kleptocracy and power relations, so did Sraffa. Michael Hudson, a favorate of mine and this blog, has focused on that. The classical economists dealth with class and power relations in the economic system and neoclassical economics is the paradigm that replaced the classical economics of Smith, Ricardo, Marx and Mill.

      I totally see why people have such a horrible opinion of economics, but the field is as important a field as there is and it can go a long way towards making the world a better place, or worse. Neoclassical economics haven’t only destroyed the environment, workers movements, developing (and increasingly developed) countries. They’ve destroyed what people think is economics itself.

      I just have to say though, we are dealing with a worldwide ecological crisis. It won’t be possible to solve the problems without addressing the economic system and the ideas it is built upon. There is no way to critique the system and to articualte alternatives unless we learn what the system is and what it has done horribly wrong. That requires us not to just study the economy in reality, but also the reality less theories these charlatans come up with to justify existing policy. Again, I understand why you say what you do, but don’t abandon the field of economics. People have done this and look what it has lead to. These bastards have to be challanged from within. We shouldn’t accept the monopoly they have in the field.

      I say this because I have been reading Terry Anderson’s “Free Market Economics” book and his ideas horrify me. The ideas he articulates are morally reprehensible and have become the mainstream within neoclassical economics as far as how to deal with ecological and environmental issues. They have, as usual, been a failure and are leading us to ecological collapse.

      If anyone is interested, look up what neoclassical economics claim and have done in regards to cost-benefit analysis, putting prices on ecological services and systems, putting prices on human lives and social and ecological costs, discounting, etc. If people just dismiss economics as a whole then we are left with that jumbled mess.

  4. Ruben

    I would conjecture that the collapse of the USSR led to a general contraction of the social ideological pantheon worlwide. One manifestation of this worlwide ‘purge of thoughts’ would be that the then dominant western economic ideology -the neoclassical program- became even more dominant.

    On another note, the fact that equilibrium concepts are dominant ideas inside neoclassical economics is a sign of immaturity, a juvenile inability to deal with complex nonlinear dynamical processes.

  5. psychohistorian

    How can one have a purported social science that attempts to describe how we all interchange things on large and small scales.


    You can’t discuss the class system that is the global inherited rich and their puppets in the 1% and the rest of us.

    You must “externalize” significant portions of interchange around war and American imperialism of the past 70+ years.

    You must not bring clarity to public about the private financial system owned by the global inherited rich that controls the lifeblood of all “Western Democracies” and most of the rest of the world.

    You must not explain to the public that the concept of the invisible hand is cover for the global inherited rich deciding which countries, technologies and people get invested in when, for how long and for what geopolitical reason.

    So,,,,,,,, other than a few exclusions, everything those economists have to say is very meaningful to our current social organization.

    Don’t get me started about the abuse of models by these folk….it does give modeling a bad name.

    economists = sellouts of humanity

  6. Capo Regime

    About what seems so far away, back in graduate school (yes for PhD in economics and specialization in econometrics) in the early 1980’s this tendency was fully in place. At that time where I went in school were remnants of a approach known as institutional economics as well as some economic historians. You were pretty much told that if you did history, institutional or development you were not likely to get a job and you were a math anxious slug. I then went and did development but only after doing something” rigorous”–hey when you are 22 and a nerdy kid you listen to what you are told ad seek approval.

    A very interesting thing–its a was only in 2000 that the top journals AER reguired that research be replicable. Not all top journals require replicaion–so you can make the assumption that some fudging certainly takes place. If its not replicable and its not usually empirical–what the hell good is it?

    If you think that economics is bad and it is, the people in political science are even worse. They have their own rigor fixation in a rather sad fawning way (save for Gary King at Harvard, the guy does great work) If they have come out with any ideas or condemnation of the corruption of government word of it has failed to get out.

  7. severn

    A question I am still trying to formulate a convincing answer to, since I was asked it a long time ago:

    “Why does economics have heterodox economists but science has pseudoscientists?”

    It’s clear to me that science allows challenging questions to be asked within the framework of science, but what exactly is the difference here?

      1. LeonovaBalletRusse

        “for every metal, there is a temperature beyond which the metal will not remain solid” would have been more precise.

    1. readerOfTeaLeaves

      Basically: can you show something to be false?

      If I have a beaker of water and I hypothesize that water boils at 130 degrees Fahrenheit, can I show this to be false? I can.
      Not only that, I can show my hypothesis to be false over, and over, and over – adding to the evidence that my hypothesis is incorrect.

      Conversely, no matter what source of heat I use, no matter what type of saucepan or source of water, I can probably get it to boil at 212 degrees Fahrenheit, thereby providing evidence for the hypothesis: “Water boils at 212 degrees F.”

      Contrast with the perfidy of Alan Greenspan in an OpEd at FT, “Meddle with the market at your peril”:

      “Controlled experiments are not feasible in economics. But we came close in the competition between East and West Germany after the second world war….”
      He goes on to wax about how the two Germany’s had similar histories, languages, etc, etc. To read Greenspan’s piece, you’d think that free market economics versus ‘a centrally planned economy’ were the primary, albeit really ‘only’ differences between the two Germanys, and therefore capitalism is just the greatest economic system, evah.

      In fact, there are tons of confounds between the two systems that Greenspan glossed over. So being unable to detail the number of potential differences between A and B makes for a mess of muddles. But unfortunately, Greenspan is kind of the poster boy for making economics ‘look sciencish’, which as PP points out is primarily about power and not about economics.

      1. Me

        To call West Germany a “free market” after WWII is laughable. It reminds me of what Milton Friedman said about India vs. Japan. He claimed that Japan was an example of a “free market” maricle and that India and Japan began at roughly equal positions developmentally in the late 19th/early 20th centuries. He claimed that India was “collectivist” and that Japan was a “free market” success story. Anyone reading this who knows anything about those two countries developmental path and the vast differences between the two knows what nonsense that is, but that is what people like Friedman and Greenspan think. Reality be damned.

        If you press these people to come up with a “free market” developmental success story they’ll resort to city states like Hong Kong and Singapore, and those countries are not as free market as people on the right claim anyway.

        1. readerOfTeaLeaves

          “Reality be damned”, ’tis.

          Having read “Greenspan’s Bubbles” (Fleckenstein and Sheehan), if Alan claimed the sky was blue, I’d be skeptical. That man should come with a Surgeon General’s warning: “Warning! Listening to this man may be hazardous to your long term financial prospects, to say nothing of your city’s tax base.”

          He’s a master of muddles, that Maestro.
          Mamma mia!

        2. Hepion

          Well they don’t really belive it they just preach it. Then naive people like Krugman believe (some of) it and preach it. That’s how it goes.

          It’s the problem of our society that most extreme right (far righ) drives its in-human ideological agenda with all sort of lies and propaganda.

  8. prufrock

    It is very simple and clear-cut: during the ’70s we experienced the re-offering of the neo-classical “system” of theories with NO change, improvement or apparent re-thinking. That old, unbelievably stupid way of thinking had given to the western emisphere the world war and the following deep crisis of democracy which led to nazi-fascism in the new-comers powers.
    Why the hell could anyone accept the deal? Maybe for “double-digit” inflation for a few years – gosh! oil price in real terms was just moving from zero that was absolutely acceptable some significant adjustment in relative prices -? So, we’d better deal with the events ranging from the demise of gold parity and the oil crisis (1973 and 1979) delivering to all of us the Reagan’s years that ultimately founded the current Robber’s Realm.
    Also having a look at “Professor X” annual income all-in could help.

  9. Juegos Olimpicos Londres 2012

    Today, I went to the beachfront with my children. I found a sea shell and gave it
    to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She placed the shell to her ear and screamed. There was a hermit crab inside and it pinched her ear. She never wants to go back! LoL I know this is entirely off topic but I had to tell someone!

  10. David James

    The problem, of course, with wannabe experts like the lowly author, besotted with aspirations and absurd arrogance, is that they confuse their elbow with their rectum. It may have escaped PP’s attention, but he is renowned, in more elevated company, for being a pompous fool. I’ve yet to hear a word he says display the tiniest iota of intelligence or knowledge. Where are the real Economists, those invited to share in the behind-the-scenes activities, those whose work brought us reality and authenticity?! Gone forever? This sorry bunch of sickeningly blind fools has much to answer for.

    1. Philip Pilkington

      Hate mail. Cool. Thanks for taking the time.

      Question though: which “elevated company” — the best elitist phrase I’ve heard in years — do you move in in which my name rings out so loudly? I’m fascinated.

      1. Andrew

        Elevated company is actually afternoon tea with Mrs Bouquet. I’m sorry Phillip but you won’t be on the organizing committee for the village fete this year.

        He is partially right though. I’m sure there are MMT cognisant economists at hedge funds and other trading desks. Keeping their mouths shut and making more pennies for the master.

    2. Watt4Bob

      I can’t think of a more perfect confirmation of the author’s basic premise than your sad, naked attempt, not to enlighten, but to stifle.

    3. Me

      “The problem, of course, with wannabe experts like the lowly author, besotted with aspirations and absurd arrogance, is that they confuse their elbow with their rectum”

      Clearly you don’t like what he said and are just emotionally reacting. Must have struck a nerve with ya, huh? People are rude and call people names when they have nothing of substance to say. Say what you want in response, but if you had something of substance to say you would do so.

  11. jsmith

    The state of economics is a joke for many reasons but among the chief of them being that be abandoning any and all discussion of Marx following WWII and the Cold War.

    If vulgar Marxism describes 90 percent of what goes on in the world – and many believe this to be an accurate claim – then why are economists wasting so much time on silly theories that attempt to paint increasingly complex pictures of the remaining 10 percent?

    Gee, one would think that social scientists – i.e., economists – would want to delve into and expand upon Marxist theories that have as their basis a more accurate depiction of how society runs, rather than fiddle with complexities that only a thesis advisor could love, huh?

    Hmmm, could it be that there’s no money in Marxism in a capitalist society, even in academia?!!


    Economists are really doing their utter best to more accurately and perfectly describe the wonderful system we all live under and all for the sake of intellectual progress.

    Why, just ask Frederic Mishkin.

    1. Watt4Bob

      “Economists are really doing their utter best to more accurately and perfectly describe the wonderful system we all live under and all for the sake of intellectual progress.”

      Build a better mousetrap, and a couple of very large, hooded economists will break down your door in the middle of the night, and convince you that for your own good, and the good of the country, you should agree to leave inventing things to ‘real inventors’.

  12. Stegiel

    The knowledge filter cuts across all science and all disciplines. It is an ideology. It is enforced tacitly and sometimes firmly. You can see this in anthropology and archeology as well. In college a friend quoted her economics professor-a Marxist-who smiling said if economic models do not match the real world-so much the worse for the real world.
    Very probably it is a kind of primate dominance hierarchy as seen with baboons. Some speculate Homo Erectus behaved like a baboon and of course the descent from Erectus to modern academics is well understood from elite grave goods left behind.

  13. Susan the other

    Your instincts are good Philip. Consider 1973 and an inflation that took off like wildfire. Hmmm. It didn’t take long for “economists” and “politicians” to become pompous. Why? To take cover. Under an orthodox and dogmatic umbrella of denial. Nobody could truthfully control what was happening. So their orthodoxy was just fudged. I remember it clearly. We went from a laid-back counterculture of open minded people (I think a majority of us) to browbeaten, debt-ridden nitwits. In less than a decade. I think if we delve deeper into this weird phenomena we will find the national secret so humiliating no one is allowed to approach it. It is that banksters and elites have been practicing their own MMT for a good long time and making a profit from it via arbitrary taxation policies. But if everybody caught on to it, then taxation could no longer be arbitrary. No more socializing losses.

    1. LeonovaBalletRusse

      Susan, look at how rich these formerly-rather-poor Academics got doing this! Meat grinding brings unimaginable riches. Nerds get laid quicker and better.

  14. George Washington

    Mr. Pinkerton,

    Great post. One question: who OWNS the most prestigious economic journals? In other words, could money be exerting an influence? Or are the top journals run by economic societies themselves in a non-profit capacity?

    1. LeonovaBalletRusse

      GW, yes, “Cui bono?” Whose interests are served by the “publishers”-back?

    2. Philip Pilkington

      Sorry, missed that. Not the first time I’ve been called Pinkerton. ;-)

      As to who owns the journals, that’s not really the issue. certainly there are privately funded think tanks that have huge sway over policy — the Peterson Institute being a good example — but they are generally seen for what they are in academia; that is, partisan and politically motivated.

      The ‘controls’ in academia are far more deeply ingrained, so far as I can tell. It’s not to do with ownership, it’sto do with sanctioning what sort of arguments are allowed through the ‘filter’. The ‘filter’ is manipulated by people who adhere to a very specific conception of what shape economic discourse could take — one in which they have much intellectual, social and real capital invested in. This is actually not so unusual and you find factions vying for control all over th social sciences. However, economics seems to me somewhat unique in that it has become basically homogenous as far as leading journals goes.

      Why this happened in economics and not elsewhere, I’m not sure. I know that a lot of the history falls around the figure of Paul Samuelson and also the Cowles Commission. I know that the Mont Pelerin Society played a large role in policy orientation, but I’m not as inclined to accept that it played much a role in the academic sphere.

      My impression is that a certain mindset won out in economics due to a few events that took place at certain times in history — the inflation of the 1970s, but also the red-baiting surrounding Lorie Tarshis’ textbook after WWII and probably a number of other events. Frankly though, I don’t think the history has yet been written. Although Philip Mirowski has made a good attempt.

  15. knowbuddhau

    Philip Pilkington wrote:

    I think, institutional framework aside, it’s founded on quasi-theological principles (teleology/equilibrium etc.)

    Seven years ago, I came across an article that speaks exactly to that process. But I don’t know enough about economics to evaluate it properly.

    Let there be markets:
    The evangelical roots of economics

    By Gordon Bigelow

    Harper’s Magazine May, 2005

    From the May 2005 issue. Gordon Bigelow is a professor at Rhodes College in Memphis, Tennessee, and the author of Fiction, Famine, and the Rise of Economics in Victorian Britain and Ireland.

    Economics, as channeled by its popular avatars in media and politics, is the cosmology and the theodicy of our contemporary culture. More than religion itself, more than literature, more than cable television, it is economics that offers the dominant creation narrative of our society, depicting the relation of each of us to the universe we inhabit, the relation of human beings to God. And the story it tells is a marvelous one. In it an enormous multitude of strangers, all individuals, all striving alone, are nevertheless all bound together in a beautiful and natural pattern of existence: the market. This understanding of markets—not as artifacts of human civilization but as phenomena of nature—now serves as the unquestioned foundation of nearly all political and social debate. As mergers among media companies began to create monopolies on public information, ownership limits for these companies were not tightened but relaxed, because “the market” would provide its own natural limits to growth. When corporate accounting standards needed adjustment in the 1990s, such measures were cast aside because they would interfere with “market forces.” Social Security may soon fall to the same inexorable argument.

    The problem is that the story told by economics simply does not conform to reality. This can be seen clearly enough in the recent, high-profile examples of the failure of free-market thinking—how media giants have continued to grow, or how loose accounting regulations have destroyed countless millions in personal wealth. But mainstream economics also fails at a more fundamental level, in the way that it models basic human behavior. The core assumption of standard economics is that humans are fundamentally individual rather than social animals. The theory holds that all economic choices are acts of authentic, unmediated selfhood, rational statements reflecting who we are and what we want in life. But in reality even our purely “economic” choices are not made on the basis of pure autonomous selfhood; all of our choices are born out of layers of experience in contact with other people. What is entirely missing from the economic view of modern life is an understanding of the social world.

    This was precisely the diagnosis made five years ago by a group of French graduate students in economics, who published their dissent in an open letter that soon made minor headlines around the world. In the letter the students declared that the economic theory taught in their courses was hopelessly out of touch, absorbed in its own private model of reality. They wrote:

    We wish to escape from imaginary worlds! Most of us have chosen to study economics so as to acquire a deep understanding of the economic phenomena with which the citizens of today are confronted. But the teaching that is offered . . . does not generally answer this expectation. . . . [T]his gap in the teaching, this disregard for concrete realities, poses an enormous problem for those who would like to render themselves useful to economic and social actors.

    The discipline of economics was ill, the letter claimed, pathologically distant from the problems of real markets and real people.

    The students who offered this diagnosis in 2000 were from the most prestigious rank of the French university system, the Grandes Ecoles, and for this reason their argument could not be easily dismissed. Critics who accuse economists of embracing useless theory usually find themselves accused of stupidity: of being unable to understand the elegant mathematics that proves the theory works. But the mathematical credentials of these students were impeccable. The best of a rising generation were revolting against their training, and because of this the press and public paid attention. Orthodox economists counterattacked, first in France and then internationally. Right-wing globalist Robert Solow wrote a savage editorial in Le Monde defending standard economic theory. The debate became so protracted that the French minister of education launched an inquiry.

    Economics departments around the world are overwhelmingly populated by economists of one particular stripe. Within the field they are called “neoclassical” economists, and their approach to the discipline was developed over the course of the nineteenth century. According to the neoclassical school, people make choices based on a rational calculation of what will serve them best. The term for this is “utility maximization.” The theory holds that every time a person buys something, sells something, quits a job, or invests, he is making a rational decision about what will be most useful to him, what will provide him “maximum utility.” “Utility” can be pleasure (as in, “Which of these Disney cruises will make me happiest?”) or security (as in, “Which 401(k) will let me retire before age eighty-five?”) or self-satisfaction (as in, “How much will I put in the offering plate at church?”). If you bought a Ginsu knife at 3:00 a.m., a neoclassical economist will tell you that, at that time, you calculated that this purchase would optimize your resources. Neoclassical economics tends to downplay the importance of human institutions, seeing instead a system of flows and exchanges that are governed by an inherent equilibrium. Predicated on the belief that markets operate in a scientifically knowable fashion, it sees them as self-regulating mathematical miracles, as delicate ecosystems best left alone.

    If there is a whiff of creationism around this idea, it is no accident. By the time the term “economics” first emerged, in the 1870s, it was evangelical Christianity that had done the most to spur the field on toward its pres ent (sic) scientific self-certainty.


    Now, all that comports very nicely with my comparative-mythological approach. To me, it’s abundantly clear that economics is serving all four functions of a mythology.


    Function of Myth

    Campbell often described mythology as having a fourfold function for human society. These appear at the end of his work The Masks of God: Creative Mythology, as well as various lectures.[25]

    The Metaphysical Function: Awakening a sense of awe before the mystery of being

    According to Campbell, the absolute mysteries of life cannot be captured directly in words or images. Myths are “being statements”[25] and the experience of this mystery can be had only through a participation in mythic rituals or the contemplation of mythic symbols that point beyond themselves. “Mythological symbols touch and exhilarate centers of life beyond the reach of reason and coercion…. The first function of mythology is to reconcile waking consciousness to the mysterium tremendum et fascinans of this universe as it is.”[26]

    The Cosmological Function: Explaining the shape of the universe

    Myth also functions as a proto-science, bringing the observable (physical) world into accord with the metaphysical and psychological meanings rendered by the other functions of mythology. Campbell noticed that the modern dilemma between science and religion on matters of truth is actually between science of the ancient world and that of today.

    The Sociological Function: Validate and support the existing social order

    Ancient societies had to conform to an existing social order if they were to survive at all. This is because they evolved under “pressure” from necessities much more intense than the ones encountered in our modern world. Mythology confirmed that order and enforced it by reflecting it into the stories themselves, often describing how the order arrived from divine intervention.

    The Psychological Function: Guide the individual through the stages of life

    As a person goes through life, many psychological challenges will be encountered. Myth may serve as a guide for successful passage through the stages of one’s life. For example, most ancient cultures used rites of passage as a youth passed to the adult stage. Later on, a living mythology taught the same person to let go of material possessions and earthly plans as they prepared to die.

    Campbell believed that if myths are to continue to fulfill their vital functions in our modern world, they must continually transform and evolve because the older mythologies, untransformed, simply do not address the realities of contemporary life, particularly with regard to the changing cosmological and sociological realities of each new era.


    Has anyone read Bigelow’s article? Can someone please evaluate its claims vis-a-vis the history of economics? Is his argument valid? If so, how does it relate to Pilkington’s?

    IMO, the power of myth is the most powerful force in the human world. Why? Because it primordially brings into being the world stage on which we latterly play our ever more notorious parts.

    If neoclassical myths are bringing into being this world of pain we’re living in, I suggest the methods of comparative mythology can be helpful in busting them even as we develop new metaphors (the fundamental unit of myths) for being human in this ever changing world.

      1. knowbuddhau

        You’re welcome both of you, thanks for the replies. I often think the same about Rand.

        One of my crazier ideas is that, sometime during Campbell’s decades of lectures for the State Department’s Foreign Service Institute (beg. 1956, the same dreadful fate befell comp mythology as psychology. That is, just as APA and DOD systematically weaponized psych into PSYOP (for a detailed account, see “The Day the Tide Turned”, I fear that someone has systematically weaponized comparative mythology into MYTHOP.

        Recall that it was myths about nukes, not the nukes themselves that jacked us to war in Iraq. Iran’s non-existent nukes, not Israel’s very existent ones, threaten world peace. Japan thought it had solved its enrgy problem by bottling the genie that twice terrorized it.

        Did the Chicago Boys deliberately use the weaponized power of myth to jack Chile?

        You know, the most left-wing place on the planet at the moment is, interestingly enough, the first place where Chicago School ideology made that leap from the textbook into the real world, and that’s Latin America. And that happened for a very specific reason, as you know. This — in the 1950s, there was great concern at the State Department about the fact that Latin America, then as now, as it seems to do, was moving to the left. There was concern about what they called the “pink economists,” the rise of developmentalism, import substitution, and, of course, socialism. And, of course, this was a concern because it greatly affected American and European interests, because the crux of the argument of import substitution was that countries like Chile and Argentina, Guatemala, should stop exporting their raw natural resources to the north and then importing expensive processed goods to the south, that it didn’t make economic sense, that they should use the same tools of protectionism, of state supports, that built the economies of Europe and North America. That was that crazy radical idea, and it was unacceptable.

        So, this plan was cooked up — it was between the head of USAID’s Chile office and the head of the University of Chicago’s Economics Department — to try to change the debate in Latin America, starting in Chile, because that’s where developmentalism had gained its deepest roots. And the idea was to bring a group of Chilean students to the University of Chicago to study under a group of economists who were considered so extreme that they were on the margins of the discussion in the United States, which, of course, at the time, in the 1950s, was fully in the grips of Keynesianism. But the idea was that there would be — this would be a battle to the — a counterbalance to the emergence of left-wing ideas in Latin America, that they would go home and counterbalance the pink economists.

        And so, the Chicago Boys were born. And it was considered a success, and the Ford Foundation got in on the funding. And hundreds and hundreds of Latin American students, on full scholarships, came to the University of Chicago in the 1950s and ’60s to study here to try to engage in what Juan Gabriel Valdes, Chile’s foreign minister after the dictatorship finally ended, described as a project of deliberate ideological transfer, taking these extreme-right ideas, that were seen as marginal even in the United States, and transplanting them to Latin America. That was his phrase — that is his phrase.

        But today, we see that these ideas are reemerging in Latin America. They were suppressed with force, overthrown with military coups, and then Chile and Argentina, Uruguay and Brazil all became, to varying degrees, laboratories for the ideas that were taught in the classrooms of the University of Chicago. But now, because there was never a democratic consent for this, the ideas are reemerging. [Emphasis added.]

        And the scariest thought I have is that our own home-grown Chicago boys been hard at work, here on the “home front,” all this time, perverting the mythical powers of our own hopes, dreams, terrors, and aspirations and using them against us.

        1. LeonovaBalletRusse

          with Water from Chicago Rock for IMPLEMENTATION: Team Friedman/Kissinger working Neoconlib Kapitalist Realpolitik, for shame.

        2. Philip Pilkington

          Nah. You can be safe in the knowledge that neoclassicals and monetarists believe the garbage they spew. I know that may seem fantastic, but they do. They’re like modern day scholastics.

          1. knowbuddhau

            Thanks for the reassurance. I’m thinking more of the Pentogon’s “information operators.”

            While academics surely believe the sermons they preach, without necessarily thinking of them as sermons, it’s the deliberate construction of nation-jacking narratives that interests me. Certainly, not everything one sees in the multimedia is a PSYOP; just as certainly, some of it is.

            It looks to me like old school Comp Mythology, Psychology, and Economics have modern weaponized versions that are being used in a project of deliberate ideological transplant, imposing the will of the 1% on the 99%, as exemplified best by the Chicago Boys but also going on right this minute.

            As in the very insightful article posted here on NC .

            Or in this 2008 TRNN interview by Pepe Escobar of Nick Turse and Tom Englehardt:

            [The Real News Network Analyst Pepe] ESCOBAR: So you would say that American life is totally Pentagonized.

            [Nick] TURSE: Yeah. There’s been a real militarization of the entire society and the economy, but not one that people realize. You know, there aren’t, you know, parades with tanks rolling down the street and guys in uniform, but this is going on covertly. It’s in the pop culture, in the hottest movies�last year, Transformers, the movie, a huge blockbuster hit, major Pentagon influence; this year, Ironman. They find ways to infiltrate the American mainstream culture.

            Or this 2009 post by Scott Horton:

            Pentagon Targeted and Mistreated Journalists, AP Head Charges

            By Scott Horton
            Harper’s Magazine
            17 Feb 2009

            …the Pentagon is spending at least $4.7 billion this year on “influence operations” and has more than 27,000 employees devoted to such activities. At the same time, [Associated Press head Tom] Curley said, the military has grown more aggressive in withholding information and hindering reporters.

            The Associated Press’s special report on Pentagon “influence operations” can be read here. The Pentagon’s Public Affairs Office has been one of the last redoubts of the Neoconservatives. Burrowed Bush era figures remain in key positions in the office, which had responsibility for implementation of some of the Rumsfeld Pentagon’s most controversial strategies in which the American public was targeted with practices previously associated with battlefield psy-ops.

            Whatever the case may be, we’ll be wise to use the power of myth’s healing virtues ourselves.

    1. LeonovaBalletRusse

      knowbuddhau, thanks. The Creating Goddess was Ayn Rand (was she CIA?), her “Saul/Paul” Imperial Servants were High Priest Alan Greenspan and Secret Agent Henry Kissinger.

      1. LeonovaBalletRusse

        re link: It’s ever amazing what a “Triumph of the Will” can accomplish for ill.

        1. LeonovaBalletRusse

          Seems the “German Romantics” are ever behind the “Triumph.”

          See: “German Romanticism” in “METAPOLITICS: The Roots of the Nazi Mind” by Peter Viereck for full comprehension of this disease brought to America.

          “German Romanticism” in USA!USA! as Chicago Boyz Religious Rocque Stars performed The Petrodollar Putsch via “The Shock Doctrine”–first tried abroad, then brought “Homeland” when perfected, via REX 84, PNAC, 9/11 for the P.A.T.R.I.O.T Act and FEMA Defense, unto Security State in Olde Virginie and the Security Stairway to Heaven in Utah.

          “Isn’t it Romantic?” Crank up Richard Wagner at the Aspen Festival, and bathe in “The Blue Light” revered by Leni Reifenstahl. The addiction to the “American Dream” of “German Romantic Religion” since WWI is America’s tragic flaw. How many more must die to keep this perverse Victorian II-IVth Reich dream alive?

          “Weep, you may weep,
          For you may touch them not” wrote Wilfred Owen (“GREATER LOVE”).

          The fault is in the DNA of humanity’s “EGO PRIMO”-driven Monsters of Lust for Gain. Indeed, “Not to be born is the best for man.” (W.H. Auden: “DEATH’S ECHO). We are living proof of this brute fact.

  16. sierra

    Heterodoxy must be crushed….that is the historical maxim by all ruling elites. For a progressive society, it should be continously searched for, nourished and brought into the sunshine for real debate. Alas, for too many years we have depended on non-heterodox thinking….banish new ideas so that we alone can flourish……that kind of thinking is what has brought this economy to its knees.
    And still, we are all asleep…..

  17. LeonovaBalletRusse

    “includes lending to the government by captive domestic audiences” — chez Jesse: Matieres: Hinde.

    This prissy linguistic finesse has the ring of Eton’s Finest, don’tcha think?

  18. JIm

    “…something weird is going on in the economics profession and has been going on for over 30years, something that I strongly believe it would be in the educated public’s interest to scrutinize closely. Perhaps this wouldn’t be so important if economic doctrine were not the language of power in most of the world. But it is.”

    Philip, it may in fact be the case that professional knowledge generally(think medicine or law), not simply economics, has become the language of power throughout the world.

    Most progressives seem hesitant to look too closely at the role of professionals, professional knowledge and the university in the current structure of power. I would argue that such a “language of power” began to become a problem 120 years ago, not 30 years ago.

    The universities, themselves, have evolved into powerful institutions which primarily certify professionals Through these institutions doctors, lawyers, economists etc. are able to establish control over a specific body of relatively esoteric knowledge which distinguishes their members from potential competitors.

    Universities, of course, also help to limit access to specific professions, reducing competition within a particular profession. And then, within each of these professions (not simply economics) a hierarchy of journals is established to support the predominant paradigm.

    Today large amounts of taxpayer money, public authority and policy choices have been delegated to the professions and to the universities that helped to create these professions.

    If the professions, in general, have become a more and more important part of our current structure of power, it does not seem surprising that the struggle for intellectual paradigm control within each discipline( not only economics)is increasing vicious.

  19. Capo Regime

    As an aside would you say Philip that besides economics, we can certainly say the same of the “disciplines” of management, finance, education, politics and of course law? Economics is perhaps but one component of a generalized cultural decline. Lets not forget journalists without which economists and their notions would be far less influencial than they are….

    1. Philip Pilkington

      @ Jim aswell.

      I assume that you guys are referencing Michel Foucault and his “knowledge as power” argument. Yes, I agree. There’s a great deal of truth in what Foucault argues — and you guys outline above (note that Christopher Lasch also argued in this vein and I prefer him to Foucault, broadly speaking).

      Occasionally Foucault could be a bit extreme — certainly his arguments against psychiatry were off the mark and opened the gates for the neoliberal dismantlement of many psychiatric institutions (which, as far as I understand it, gave rise to massive problems with homelessness in the US). But most of his arguments stand, I think.

      However, I think economists and economic discourse is at the “top of the pyramid” because financial considerations trump everything at the end of the day. I also think that Foucault recognised this towards the end of his life which is why he delivered this fascinating series of lectures:

      I also think a strong case can be made that as privatisation pushes forwad many forms of knowledge become more and more infused with power. This seems counterintuitive if you take Foucault’s and Lasch’s anti-state focus. But it actually makes a lot of sense when you realise how cuts in financing generally goes hand in hand with “reforms” that disperse power throughout society in a decentralised, but at the same time very condensced way. It also makes a lot of sense when you look at issues like intellectual copyright laws — not to mention privately funded drug research; especially when related to psychotropics (which have replaced the psychiatric institutions referred to a moment ago).

      1. Capo Regime

        Great points Phillip. Hyperspecialization and technology probably add to the mix.

      2. LeonovaBalletRusse

        PP, you won’t like this, but for balance see:

        “THE IDEOLOGY OF TYRANNY: Bataille, Foucault, and the Postmodern Corruption of Political Dissent” by Guido Giacomo Preparata (Palgrave Macmillan, 2007).

        1. Philip Pilkington

          Equating Bataille and political correctness is something of a stretch to say the least. They would have made a better argument trying to link Norman O. Brown and PCism through the father of PC: Herbert Marcuse. But again, I think that would miss the point of the work of people like Bataille and Brown which, above all, is art rather than politics.

          1. Capo Regime


            What is your view of the work of John N. Gray. Always seemed to me that Flase Dawn was correct in pointing out how the several ideas of secula humanism and neo iiberaism (economics esp) are all chimera’s and while they last they only serve a few interests and its all a fragile and doomed structure….

          2. Philip Pilkington

            I’m not hugely familiar with it, to be honest. But from what I’ve come across he appears to take over all the bad parts of Isaiah Berlin’s work — which, while brilliant, I always thought slightly dishonest. He thinks that he’s banishing religious concepts, but he’s probably sneaking them in the back door. Also, his view on humans and the environment strikes me as misanthropic to say the least. Oh, and anyone who blames Fascism or Soviet Communism on a set of ideas simply doesn’t have a good grasp of history or certain deeply imbedded natural attributes of Man (the aggressive drive to destroy, for example). The ideas are secondary vehicles for something far more fundmental and sitting around in your study weighing up philosophical doctrines won’t change the fact that there are any number of people out there waiting for society to allow them murder and control people.

            Anyway, I’ll stop. This is all getting a bit naval-gazeish.

          3. LeonovaBalletRusse

            PP “not hugely familiar” with Gray’s “FALSE DAWN?” Is this answer a hedge?

          4. Capo Regime

            I think you hit the nail on the head in your critique which is actually a feature of gray. In his view ideas, sheals.. At core we are predatory and cultural norms will tend to keep us in check but neoliberalism tends to homogenize us and leave us bereft of indigenous culture and we then intellectualize abhorrent behavior under the guise of say economics and globalisation–both covers for exploitation leading to conflict. Economists are at center stage on this…

      3. Claire

        Some quotes by Michel Foucault, related to power, the individual, etc

        “Do not demand of politics that it restore the “rights” of the individual, as philosophy has defined them. The individual is the product of power. What is needed is to “de-individualize” by means of multiplication and displacement, diverse combinations. The group must not be the organic bond uniting hierarchized individuals, but a constant generator of de-individualization…Do not become enamored of power.”

        “I don’t feel that it is necessary to know exactly what I am. The main interest in life and work is to become someone else that you were not in the beginning.”

        Do not ask who I am and do not ask me to remain the same. More than one person, doubtless like me, writes in order to have no face.”

        “…it’s my hypothesis that the individual is not a pre-given entity which is seized on by the exercise of power. The individual, with his identity and characteristics, is the product of a relation of power exercised over bodies, multiplicities, movements, desires, forces.”

        “Maybe the target nowadays is not to discover what we are but to refuse what we are.”

        The strategic adversary is fascism… the fascism in us all, in our heads and in our everyday behavior, the fascism that causes us to love power, to desire the very thing that dominates and exploits us.”

        “The real political task in a society such as ours is to criticize the workings of institutions that appear to be both neutral and independent, to criticize and attack them in such a manner that the political violence that has always exercised itself obscurely through them will be unmasked, so that one can fight against them.”

        “Do not ask who I am and do not ask me to remain the same. More than one person, doubtless like me, writes in order to have no face.”

        “Where there is power, there is resistance.”

        1. Claire

          And as long as Foucault’s thought is being considered, some of you might be interested in the forward Foucault wrote to Pierre Rivière’s autobiographical account, entitled: “I, Pierre Riviere, having slaughtered my mother, my sister, and my brother….”

          In Normandy in 1835, Pierre Rivière savagely murdered most of his family and then, in the course of the investigation and trial, wrote an unusual autobiographical account of the murders, carefully explaining his motivations for the heinous crime.

          Foucault: “[what] led us to spend more than a year on these documents…..was simply the beauty of Riviere’s memoir. The utter astonishment it produced in us was the starting point.”

          1. Philip Pilkington

            I think you’re taking that out of context. This isn’t some sort of celebration of a murderer as, say, Ayn Rand celebrated William Edward Hickman. The point Foucault is making is that the Riviere case threw up a really nuanced and self-studied autobiographical case study. These are rare an highly valued by people working in psychopathology. The classic example being the Schreber case as studied by Freud. But to find material like this is rare. Usually people have to work off dubious second-hand case studies that are filled with the biases of the person writing them — the James Tilly Matthews case being the classic example here.

        2. Claire

          Look, I might as well stop beating around the bush here, whenever I hear the word “Foucault”, I reach for my gun.


        3. Claire

          Philip Pilkington: “This isn’t some sort of celebration of a murderer…”

          Thanks, Philip.

          I’m not sure why I dislike Foucault, but I don’t think this is it. I wasn’t passing a moral judgement and I didn’t think he was celebrating murder.

          There’s just something about him I dislike, I can’t quite put my finger on it. Perhaps unfairly, I blame him for all of this identity politics and gender studies, etc, that seem to have taken over US universities.

          And I’m given to strong, sometimes eccentric, opinions anyway. For instance, when I had to read Dostoyevsky’s Crime and Punishment, I was far more interested in the first part, which is the preparation for the murder.

          Remember the scene where Raskolnikov is getting the axe ready? And he was fascinated by the crime he was about to commit?

          I love that part!

          On the other hand, the last part of the book, about guilt and moral responsibility, and so forth, bored me to tears.

          1. JTFaraday

            “Perhaps unfairly, I blame him for all of this identity politics and gender studies, etc, that seem to have taken over US universities.”

            Yes, it’s unfair. F questioned the whole notion of stable “identities.”

          2. Claire

            JTFaraday:”Yes, it’s unfair. F questioned the whole notion of stable “identities.”

            An excellent point. As did James Joyce “I’m an in-divide-you-all” (Finnegans Wake) and Norman O. Brown, mentioned by PP above, who once wrote: “The solution to the problem of identity is, get lost.” – (Love’s Body), and many others.

            No, that’s not it. I actually agree with Foucault on this point.

            Hmm…. so why are all those annoying gender studies – identity politics – people always praising Foucault, or at least this is my impression.

            Have they completely misread him? Or they’re just interpreting him to suit their agenda?

            And I’m not ruling out the possibility that I’m wrong and I’m the one who’s misinterpreting him.

          3. Philip Pilkington

            “Have they completely misread him?”


            “Or they’re just interpreting him to suit their agenda?”


            Same with Derrida. Those French philosophers cannot be used in any positive manner. Their criticisms are fundamentally negative. The closest thing they can be used to justify is some sort of negative aesthetics.

          4. Claire

            Philip Pilkington: (responding to my question: “Have they completely misread him?)… Yes…”

            Thanks, Philip, this is very helpful.

            So what I’ve been doing, apparently, is blaming Foucault himself, because he’s being completely misread and misinterpreted by the Gender Studies – Identity Politics crowd.

            But many of those people are tenured professors who get paid to study this full-time, and I’m just a college drop-out.

            You’d think they could at least get something right!

            “Really it is not I who am writing this crazy book. It is you, and you and you and that man over there, and that girl at the next table.” (James Joyce, on the way Finnegans Wake was written)

          5. JTFaraday

            “Have they completely misread him? Or they’re just interpreting him to suit their agenda?”

            Well, some identities (and consider the source) are more readily destabilized than others.

            So, no, they didn’t mis-read the Guru. They disagreed with him.

          6. Claire

            Help, this is destabilizing my identity!

            Better turn to Joyce for some guidance:

            “How small it’s all!” (FW, 627)

            There, that’s better now.

      4. JTFaraday

        The business school is the top of the pyramid. The economics department serves the business school. At the top of the business school pyramid is finance. It was a quick rise. This was not the case in the early 1990s.

        There is really nothing mystifying about this. At all.

  20. different clue


    Because I don’t have my own computer, and because the workplace computer I can access this website on for brief periods loads this site so slowly, I don’t have time to find the thread relevant to a comment I will leave instead for you here.

    You voiced concern over having to take up the burden of bigotry over the deleterious involvement of Jews in economics. You referrenced Marx and Friedman specifically.

    Well, this is your lucky day! I have come to relieve you of your newfound burden. I believe Engels was co-equally co-involved with Marx in crafting MarxEngles economics. And Engels was a Christian-ancestry German. In other words, a White Man. And Friedman learned his basic economic orientation from Friedrich Hayek, the so-called “Austrian school” economist. And unless I am wrong (and I will accept correction if I am), Friedrich Hayek was an ethnic German of Christian ancestry. In other words, also a White Man.

    And as to gold buggery, the Conquistadorian Spaniards were some of history’s most notorious goldbuggers. They mass slaughter-murder genocided tens of millions of people to get the gold. And they did that without any Jewish involvement at all.

    There. Burden lifted. Glad I could help. You are most welcome.)

  21. LeonovaBalletRusse

    Timely: chez Jesse: Matieres: Coxe — gives rise to the question:

    It it time for the Holy Roman Imperial “Europe” to help ALL of the banks to die and “just let God sort it out?” Is Old Europe’s .01% Nobility OK with this?

    What would Veblen predict?

    1. different clue

      It wouldn’t just be up to the Old Money OPOOPs of Europe, would it? Wouldn’t the Old Money OPOOPs of the whole world have to be consulted? If their ownership of real wealth (land/minerals/ores/food-fiber-fuel sources/etc.) remained assured; they would be perfectly okay with the death of the financial mere-token system in which their wealth and power happens to be denominated at the moment. Because if they retain their wealth and power, they will just oversee the creation of a new financial mere-token system in which to denominate their wealth and power.

      Or would a global financial system chernobyl-event of the whole financial system send so many unhappy armed people into action so as to take away the Old Money OPOOPs wealth and destroy their power? If they feel they are realistically afraid of THAT outcome, then they will instruct their government and gang-banker financialist underlings and frontmen to save the financial mere-token system we have now.

  22. JIm

    “I also think that as privatization pushes forward many forms of knowledge become more infused with power.”

    Philip, it may also be the case that as the modern state becomes more and more powerful, professionals and the professions (through the use of their cultural capital) are able to access the social and political power of the state much more easily, whatever their political persuasion)

    In other words while the majority of the commetariat on Naked Capitalism spends much of its time appropriately condemning privatization and Big Capital but largely ignores the functional equivalent of the capitalist market—the modern state—which for many intellectuals in the professions, is more and more the linkage and foundation of their power (no matter what their political outlook).

    Big State, Big Market, Big Bank and Big University Professionals all seem to have consolidated into the modern structure of power—especially as seen from the perspective of those of us in favor of radical decentralization, local autonomy and direct democracy.

    1. Philip Pilkington

      What can I say? If you’re coming at it from a quasi-anarchist angle, that would be true. I’m a Big Government social democrat, so it doesn’t apply. And I take such a position mainly for the sake of pragmatism rather than love of government.

      I do think, however, that initiatives like the MMT Job Guarantee program have the potential to decentralise society in a meaningful way and break certain aspects of the nexus of power as described by Foucault and Lasch.

    2. LeonovaBalletRusse

      “Naked Capitalism … ignores…the Modern State” – Huh? Dig deeper.

  23. Don

    The sooner we stop calling economists scientests of any type the sooner we can start solving the worlds financial predicament. Their theories are not capable of anything like reliable predictions, and valid theories require predictable outcomes. Most can’t tell us what happened last week, let alone predict what will result from the application of their theories next week. To top it all off economists believe that we can have exponential growth indefinetly in a finite world.

  24. Howard Brody

    Sorry to join in so late and to be self-promoting to boot. An earlier comment called attention to the article by Gordon Bigelow, “Let There Be Markets.” If anyone is interested in the further developments of Bigelow’s claim, which is basically that neoclassical economics has its roots in the religious evangelicalism of early-19th-century Britain, they may wish to consult my own recent book, THE GOLDEN CALF: ECONOMISM AND AMERICAN POLICY. I argue that economism, the extreme version of neoclassical economics (also known as neoliberalism), is both logically and historically a religious belief system rather than a science. This strongly confirms much of what Philip Pilkington argues in his original post.

    1. different clue

      Very good. I myself in past comments have referred to “economics” as a system of deception and psychological operations against the target populations. There are reality-seeking economists who have tried to create a better more useful economics . . . based in biology, ecology, and physics. Frederick Soddy, Herman Daly, the Ecological Economists, Kenneth Boulding towards the end of his life, Howard Odum venturing out of his fortress of academic ecology, etc. ( And at a lesser level, Charles Walters Jr. and the other Raw Materials Economists some of whom are grouped around the National Organization For Raw Materials).

  25. JTFaraday

    The mental shutdown in academia is actually much broader (and simpler) than all of this heavy breathing rhetoric about some “economics cult.”

    The singular fact pervading all of academia is that just about every single person there is looking to “get a job” from some authority figure somewhere, or “has a job” and reports to some authority figure somewhere.

    This is as true of people who don’t believe education is primarily for “getting a job” as it is for people who think “getting a job” from some authority figure somewhere is the ONLY purpose of education. This is as true of faculty persons who report to authority figures within the profession, as it is of non-faculty persons who know they’ll never get hazed into a “tenured job.”

    This mental deformation within academe has become ever more pronounced with the expansion into mass education over the past three, maybe four now, generations. Over the past several decades, it is only economics departments and the business schools that began to convey even the faintest glimmer of the– within academe apparently novel idea (for reasons historic and WASP-ish)– that in addition to “getting a job” from some authority figure somewhere, something else has to happen somewhere along the way.

    We might broadly call this something “organization.” Because no one else thinks about this something, economists and the business schools continue to clean everyone else’s clock even as they sit covered in their own mess.

    But it is because everyone else thinks this something that we call “organization” ought to create “jobs” so that everyone else can “get a job” that everyone else will be their slaves– and whether these people organize “privately” or whether they organize through “the government” is entirely immaterial.

    That’s the real drop-dead point in contemporary intellection. Just try thinking about how to constitute a civilization without “people getting jobs.” You can’t do it. But just because you can’t do it doesn’t mean it might not, in fact, be stupid way to live.

    1. different clue

      Is there a way to do something useful for others who do other things useful to oneself in return . . . without getting a job to do that in the context of? Ran Prieur asks these questions at his blog called Ran Prieur.

      What if “getting a job” is the price we pay for living in such vastly overpopulated societies that super-specialization of every person is the only way all the people can shoehorn themselves into the same living space and exploit the habitat hard enough to keep all the people alive? What if “history” is the story of mankind’s effort to learn how to live like the social insects? And “economics” is the pseudo-science of making it work for a while?

  26. enouf

    “Chance”, in and of itself, has absolutely NO Power!, not one iota, …and neither do “the Markets”.

    All things which “cannot create” (aren’t conscious, have no imagination, etc), cannot correct themselves, nor attempt to find homeostasis/equilibrium, let alone “act” for the betterment (i.e., on behalf) of the whole.

    Talk about a Cult! heh


    p.s. (i can’t believe i made it through reading all the comments so far)

    p.s.s. For those of you not getting my reference to ‘chance’, think Big Bang Theory and that Religion, and how absurd a notion; “..if you only wait long enough. ..” is.

  27. Kunst

    This sounds a lot like religious “debate”. If I am convinced that everything depends on my God or savior, and you think reincarnation is the answer, I don’t want to “waste” my time addressing your worldview because it is incompatible with mine. The nastiest intellectual conflicts seem to come over the choice of axioms that channel the allowable range of debate. Since I am invested in mine, legitimizing yours is not just a waste of time, it threatens all the effort I have put into building my professional and emotional security. Humans are smart but not wise.

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