Notes on the Front

The President, Michael D. Higgins, has upset some economists.  According to a front-page Business Post article entitled ‘Economists round on President over ‘lazy’ and ‘uniformed spiel’: 

“Economists have rounded on President Michael D. Higgins and claimed comments made about their profession are ‘lazy’, ‘outdated’, ‘uninformed’ and ‘incomprehensible’.

Of course, it was only some economists who made these comments (I spoke to other economists who gave a thumbs-up to the Presidents’ comments). 

So what upset people so?  One was the issue of growth.  The President said:

‘Many economists remain stuck in an inexorable growth narrative . . .  A fixation on a narrowly defined efficiency, productivity, perpetual growth has resulted in a discipline that has become blinkered to the ecological challenge – the ecological catastrophe – we now face.’

This is one of the main themes of his speech – critiquing a growth narrative that fails to acknowledge ecological limits.  I doubt anyone would disagree that ignoring such limits is a really bad idea.  And to be fair, it’s not just that ‘many’ economists remain stuck. Much of the public debate, unfortunately, is stuck in that narrative. 

Some might argue that this is a de-growth argument.  That’s how Jim Power interpreted it:

‘Economist Jim Power said without economic growth it would not be possible to generate the resources needed to create a functioning society and address issues such as climate change.  “Give us a decade of zero growth and see how that works out.”’ 

The President anticipates this argument:

‘Our obsession with inexorable economic expansion expresses, perhaps, a desire to transcend our material limits and rise above the state of nature. Yet this growth fixation paradoxically increases the potency of those very limits.’

Ironically, a growth narrative without ecological limits lays the ground for devastating de-growth for economies and humanity in the not-too-distant future. 

The President didn’t attack economic growth per se; nor did he attack the economic profession as a whole.   On the contrary, he highlighted the work of a number of economic and social academics who have enriched our understanding of the economy and suggested a ‘ . . . real, emancipatory potential for a new, recovered political economy’.  Further, he didn’t dismiss conventional tools of measurement. On the contrary he gave them a new political economy framework:

‘ . . . all of the prevailing ruling concepts in our present economic discourse – flexibility, globalisation, productivity, efficiency, innovation, indeed economic growth itself – are capable of being re-defined within an active citizen participative state context, given a shared moral resonance, reimagined sustainably within the context of the new ecological-social model.’

Given this, I am at a loss to understand the reaction of some economists. The President’s approach holds out the best hope of becoming unstuck from a potentially dangerous narrative.  Thankfully, there is a growing number of economists who believe this repurposing can be done, that we need such limits, and who are working on new tools to help us achieve these goals.

A second issue raised by critics is the state of economic education.  The President called for a

‘. . . pluralism of approaches in teaching economics . . . The question of how economics is taught. . .  is a matter of utmost importance . . . failure to facilitate a pluralism of approaches in teaching economics is a deprivation of basic students’ rights . . . leading, as it does, to a narrow, blinkered and distorted education in economics and the wider social sciences.’

Again, it’s hard to imagine anyone objecting to this. But is this issue relevant today?  Stephen Kinsella described the President’s views as ‘outdated’:

‘The President is critiquing an economics that existed in the 1970s before I was born . . . he’s not engaging with the subject as it exists in 2023, as it is taught in 2023, and most importantly how it is researched in 2023.’

If that economics existed in the 1970s, it continued to exist four decades on in many places.  Following the Great Recession, a group of UK academics supported students who protested against the way economics was being taught, describing it as an ‘intellectual monoculture’ which was ‘heavily biased in favour of orthodoxy and against intellectual diversity.’

‘Students can now complete a degree in economics without having been exposed to the theories of Keynes, Marx or Minsky, and without having learned about the Great Depression.’

Similar protests occurred in the US – at Harvard University, for instance.  Students from 19 countries staged a trans-national protest stating:

‘The lack of intellectual diversity limits our ability to contend with the multidimensional challenges of the 21st century – from financial stability to food security and climate change . . . The real world should be brought back into the classroom, as well as debate and a pluralism of theories and methods.’

This speaks to the use of models in economic teaching.  Professor Karl Whelan gave a well-argued defence of economic teaching back in 2014:

‘Why don’t models in economics describe how “real people” act? The answer is that human beings are the most complex thing in the world . . .  so economic models could never be literal descriptions of how people behave.  The purpose of theory in economics is to use a model that is literally false but could help us get a better (if still incomplete) understanding of the world than we would have if we weren’t using the model to organise our thoughts.’

If this is so – the need to use false models to get us closer to describing complex interactions which are inevitably resistant to modelling – then the case for a pluralist approach to economic teaching becomes even stronger. 

These reactions described above occurred in the aftermath of the financial crash.  What about today?  A recent survey of economic students in US universities conducted by Rethinking Economics USA and the Roosevelt Network revealed that 78 percent of students have not learned about environmental or ecological economics while another 92 percent have not learned about Stratification or Feminist economics.  91 percent never heard of heterodox economics. 

It may be that, in Ireland, these issues have been resolved and that they were resolved well before the crash. Clearly, the President believes there has been considerable progress:

‘New ideas are fortunately available . . .   Thankfully, we now have a richer discourse than perhaps we did a decade-and-a-half ago at the last point of crisis . . . ‘

In stating this, he cited the recent contributions of a number of economic and social academics.

Again, given this, I am at a loss as to understand the reaction of some economists.  The President is certainly not describing the 1970s.

Ultimately, the quality and breadth of economic teaching in Irish universities is an empirical issue to be examined and tested.  It would be helpful if some academics took up the President’s challenge and surveyed the breadth and plurality of economics education.  I suspect it would be a mixed bag – dependent on the department, module and lecturer as well as under-grad/post-grad courses.  This would hopefully lead to a more constructive and informed debate.

The key word is constructive.  There have been some reactions to the President’s speech that have been anything but.  For instance, Karl Deeter tweeted:

‘The President is Irelands lefty version of Trump. Statements devoid of meaning and ignoring the fact that economic growth is the path out of poverty both here and abroad. Economic growth and rising life expectancy are two of the best metrics there are.’

Yeah, right – as if President Higgins incites far-right, racists, and neo-nazis to trash Leinster House as Trump did with Capitol Hill.  This type of contribution only degrades the debate.

It should always be remembered – the economics profession, like other academic disciplines, does not speak with one voice.  If some economists take issue with the President, they are also taking issue with other economists who would support the President’s remarks.

Once again, the President has laid down a challenge – to use our sometimes-inadequate tools to a better purpose, to construct a growth narrative within ecological limits, to enrich our understanding of economic and social issues through a plurality of analytical tools.  Many people are up to this challenge, including economists.  And if people are opposed to that democratic and sustainable purpose, fair enough.  That’s a political debate.  

So let that debate begin.  But for goodness sake, read what people have said or written before commenting.

__________________________________________________________________________________________________________________

STOP THE PRESS

Just as I was posting this blog, Minister Paschal O’Donohoe intervened in the debate – in particular, on the issue of economics education.  He stated:

“I think it’s brilliant to see a debate underway regarding how economics is taught, and what is the framework through which it is taught.  I think the President was raising some very interesting points regarding the teaching of economics. And I think all those in the economics community here in Ireland, I’m sure will engage with the substance of the claims that he’s making.’

Of his own experience the Minister said:

‘I was a student of economics in the 1990s, when we were taught to believe that financial markets were rational, and that they were able to process all information that was available to them at all times. And I think we’ve all learned, and I’ve certainly learned that that kind of theory and that kind of framework bears little resemblance to the real world.’

When specifically asked about Stephen Kinsella’s comment that the President’s views were out of date, the Minister replied: 

‘I think the President is well up to date on this. And I think if you look at the reading, and thoughts of our President, I think it is pretty obvious he is on top of many of the different themes and trends in economics.’

And all this from someone who couldn’t be considered an ideological ally of the President.