“When the facts change, I change my mind. What do you do, sir?” the great economist, John Maynard Keynes asked, reputedly. It’s a fairly minimal bar for intellectual honesty, yet it’s the question of the age.
When opinions are based more on what team you belong to and less on your assessment of the facts, the result is Brexit and Donald Trump. What does it take to change minds now?
This is presumably what President Michael D Higgins set out to do in a 40-minute speech delivered in Áras an Uachtaráin last Friday at a reception for Tasc, the left-wing think-tank. Wordy, repetitive, angry, convoluted, lofty, replete with references to Plato, Aristotle, Keynes, Rosa Luxemburg, Hannah Arendt, Zygmunt Bauman among many, and ultimately his valiant attempt to resist any “Adorno-esque sense of despondency”. Still, it wasn’t difficult to locate the root of his ire: economists and all their works and pomps.
The speech included references to neoliberalism (five or six), “one-trick ponies in economics”, and an “obsession with descriptive economic analyses and quantification of metrics, including a completely meaningless use of Gross Domestic Product that was championed at the expense of deeper analysis with theoretical adequacy”.
He didn’t just dismiss those bad boys in the past tense: “Many economists remain stuck in an inexorable growth narrative or at best a green growth narrative ... A fixation on a narrowly defined efficiency, productivity, perpetual growth has resulted in a discipline that has become blinkered to ... the ecological catastrophe [his emphasis]– we now face.”
It appears to be the president’s belief that the economically illiterate people have been duped by the economics “priesthood”
He added: “That narrow focus constitutes an empty economics which has lost touch with everything meaningful ... incapable of offering solutions to glaring inadequacies of provision as to public needs, devoid of vision.”
Once a wily constituency politician, the president may avoid full-frontal attacks on Government politicians, but economists are grist to the mill and have come under the mallet numerous times – which may explain the startling damburst of economists’ hostility over the speech.
At one point, he swerved off script to have a lash at (unnamed) people who control the budget surpluses but, even then, brought the blame back on the “priesthood” (if I heard that word correctly). This extract didn’t appear in the supplied speech, so my transcription may not be word-perfect: “Right across Europe in relation to countries like ours enjoying surplus, the suggestion is made that now when [there is] such a glaring opportunity for dealing with opportunities for care and those with greatest need, we hear warnings that you must take care of the inflation risk, because it is assumed that the public are incapable of understanding the distinction between profit-taking-driven inflation and wage inflation. And when you are talking about profit-taking inflation, which we have now”, he said, it is important that there is public understanding of the economics involved.
[ President condemns ‘obsession’ with economic growth ]
“There is nothing so complicated that it can’t be understood if explained properly. And that is why it’s so insulting to be telling the public in a way this priesthood can infect in us about the dangers of inflation, while the public suffers the loss of provision in relation to care.”
It’s very easy to agree. The point about profit-driven versus wage-driven inflation has been an infuriating conversation staple since Putin’s war exploded. Profiteering has been so egregious that governments had to impose windfall taxes and subsidise the cost of living. But it appears to be the president’s belief that the economically illiterate people have been duped by the economics “priesthood”, infected with fear about the dangers of inflation, while being deprived of vital care.
The problem is that economists are not in Government. We elect politicians, however unsatisfactory, to devise policy and to make these decisions. The notion of making complex and complicated concepts and policies accessible is a no-brainer. But that’s down to education – which should begin well before third level. Academic economists would say a big hallelujah to that.
However, President Higgins himself has been unwilling to learn or engage over the years, say the same damned economists. Some speak of invitations to bespoke seminars offered by reputable institutions that went unacknowledged or were declined. Economists find his views unrecognisable in their teaching or debates.
In 2019, when the president hosted a Rethinking Economics conference referencing “almost 40 years of mainstream economic commentary espousing privatisation, deregulation and a lesser role for the State”, Prof Ronan Lyons (not invited, obviously) commented that it was “such a shame that the president’s idea of economics was so out of touch with reality”. That same week, said Lyons, a top development economist and a top environmental economist were in Dublin and could have added richly to the event. The inference being, one imagines, that the president too has his team and his home crowd.
In response to the seething economists, an Áras spokesman said the president had highlighted the progress that had been made in the study of economics in the last 15 years and highlighted the work of some leading economists. He also welcomes, the spokesman added, “the strong work being done in the Economics departments of many of our universities”.
It’s true that the speech contained an acknowledgment of progress, but only after those cutting critiques of present-day practices and teaching of “many” economists.
It’s a strange and ugly fissure. The Irish Economic Association’s annual conference starts tomorrow in Athlone. Perhaps the president could drop by for a close-up of what is important to economists now. It includes two full sessions on climate economics and only two papers on growth. He may be surprised.