[First published in BWD magazine, autumn 2021, Braidwood NSW.]
The word Gallipoli evokes one of our most potent cultural stories, but in truth it is not one story but many. There are stories of sacrifice and national identity, but there are also stories of folly and destruction, and stories overlooked. We all, presumably, want to honour the fallen but there are those who, wittingly or otherwise, exploit the stories for other purposes. Can we have a conversation about these stories? Can we talk about which stories to keep, whether some might be corrected or discarded and others picked up? Continue reading →
[Published in Real World Economic Review #95, Davies, Geoff (2021) “A modest proposal for generating useful analyses of economies: a brief note.” real-world economics review, issue no. 95, 22 March, pp. 118-123, http://www.paecon.net/PAEReview/issue95/Davies95.pdf. Some other comments are at https://rwer.wordpress.com/comments-on-rwer-issue-no-95/ and https://rwer.wordpress.com/2021/03/25/a-modest-proposal-for-generating-useful-analyses-of-economies/.
This is written for ‘heterodox’ economists, those who recognise mainstream (neoclassical) economics is nonsense, but who seem to flounder around not knowing what to do instead. It is a little more technical than my usual posts, but the message does not depend on the details.]
I propose that economists leave philosophy alone for a while and instead try analysing some actual economic observations.
I have observed much discussion among heterodox economists about what science comprises, whether one could do “scientific” economics, and what ontology, epistemology, etc, etc, might be involved. If, for example, economies are historically contingent, how could one hope to do a rigorous analysis. I have also observed much concern about the complications of people and societies and the resulting alleged need for elaborate statistical analyses to extract an object of interest, followed by the construction of an elaborate mathematical model that includes many nuances of human behaviour.
I think the challenge is not nearly so daunting. An economic analysis does not have to emulate the precision of (some) laboratory physics to be useful. It does not have to yield a literal prediction. If one steps out of the equilibrium mindset of the neoclassical mainstream one can find obvious phenomena crying out for explanation, a financial market crash for example.
I was inspired by an early episode of Redfern Now, the one in which the scholarship kid at the posh school refuses to sing the AAF words because they insult his people. There are so many things wrong with those words. You can go through and pick at ‘boundless plains’ and ‘girt’, but for me it’s the whole tone and package.
[This was drafted around the time of the delayed budget in October 2020. Too much was happening and I suppose the world moved on before I could submit it anywhere.]
The budget frenzy does not just highlight the familiar, toxic social and political priorities of this Government and much of the Parliament, it prompts deeper probing into common assumptions, perceptions and framing. What kind of society is desirable? What kind of society is feasible? How could we create it?
The budget is an opportunity to spell out, again, how misguided are some standard economic precepts. It reveals how profoundly awry are our conception of an economy and a society, our operating assumptions on human nature and our place in the world, and the aspirations we fall miserably short of.
[I wrote this for an essay competition a year or so ago. It was not short-listed or otherwise noted. I thought it was not bad. You can see the winning essay here ($) or message me and I’ll email it. I wasn’t that impressed, but I wouldn’t be, would I? You can judge for yourself.]
Is there, at bottom, any real distinction between esthetics and economics?—Aldo Leopold, A Sand County Almanac and Other Writings
For a week or so when I was a kid my father came home from the farm every evening stinking of rotten potatoes. There was a glut and much of the previous season’s crop had not been sold. It was rotting in storage and he was digging it out and dumping it. We kids complained about how he smelt, thoughtless of his day-long immersion in the stench and disgusting sludge and oblivious to the bitter reality of another season’s hard labour gone for little return.
The other day political commentator Mungo McCallum remarked in passing that ‘the influence of the media on public opinion has always been greatly overrated’. I beg to differ, along with quite a few other commenters on his article. Here is a longer case for profound media influence.
It seems journalists in the mainstream political bubble tend to share the disconnectionof the politicians from the rest of us, which is understandable if their perception of the world is mostly the bubble. And if your measure of the problem is the distance between the mainstream media and ‘public opinion’ you might miss something important. After all, the perceptions of most punters include the highly selected pap the media choose to serve up to them, so there’s not usually going to be a big difference.
But what would a well-informed polity, or just a polity sketchily informed with a rough balance, think? What would ‘public opinion’ be then?
The false nostrums of the pseudo-science of neoclassical economics have been used to create a system that promotes endlessly increasing consumption of resources and endless elaboration of technology. This system already operates far beyond the needs of people. Our survival requires that we rein in the machine and return to proven and durable, social and moral forms of organisation.
Growth has a fundamental place in the biological world, of which we humans are a part. Unchecked growth has no place, outside of the microbial world. Unchecked growth is called a plague, an epidemic or a cancer.
Growth, among mainstream economists, has become a reflexive, mindless goal, specifically growth of the Gross Domestic Product. Growth of the GDP is the dominant global criterion for allegedly successful management of an economy. GDP is an indiscriminate measure of what we spend money on: some things good, some useless, some bad and, increasingly, some attempting to repair damage from previous spending. GDP is not a useful measure of our quality of life, whose improvement should be the real goal, but it does correlate with resource use and resource waste, also known as pollution.
Neoclassical economics is without scholarly integrity. It does not belong in universities. It certainly should not be the dominant source of policy advice to governments.
Most scholarly disciplines, be they history, physics or ecology, have a conception of appropriate standards by which the evidential basis of an argument is presented and the reasoning leading to conclusions is explained. The goal is to shed light on the workings of the world, and a criterion for a successful study is that observations or records are consistent with the study’s conclusions.
Neoclassical economics, the strand of economics that has dominated world policies for several decades, fails these criteria. Its conclusions are regularly contradicted by developments in the real world. A dominant criterion for a successful study is that its logic is internally consistent; it thus confuses mathematics with the science it claims to be. It is variously claimed that assumptions on which a theory is based don’t matter, or that the better the theory the more unrealistic the assumptions, or that all theories are wrong. It imagines its theories are useful approximations to reality, and fails to appreciate that more reasonable assumptions can lead to radically different conclusions, so its theories may be deeply misleading.
Analyses of the economic effects of global warming by prominent economists are based on patently invalid arguments, profound ignorance of the global response to solar energy and basic misrepresentation of scientific sources. Their conclusion that the effects are minor is egregiously in error and use of their analyses to advise governments has placed the world in peril.
Economist Steve Keen has published a critique (and summary) of analyses by William Nordhaus and others of the effects of global warming on the global economy. Those analyses, incorporated into official IPCC reports, suggest the effects of global warming are minor. Keen’s critique reveals the analyses to be absurdly deficient, reflecting not only profound ignorance but patently invalid arguments and a lack of scholarly integrity.
[Just out at Pearls & Irritations. Lately I’ve been avoiding politics, it’s bad for my health. Especially after the Eden-Monaro by-election, in which almost everyone retreated to their usual tribal habits. Never mind drought, six megafires, floods, virus … Hard to fathom.]
Andrew Fisher, three times PM
Dear Labor. Has anyone among your parliamentary cohort noticed that neoliberalism is a failure? Has it occurred to anyone that promoting selfishness and making people insecure is a recipe for people to turn on each other and shred the social fabric? Does anyone think it might be time to stop being Liberal-lite? Time to champion the battlers and stop pandering to the fat cats? Time for a Labor party to remember why it was founded?
The current lesson is stark. Private aged care facilities that are under-staffed, under-resourced and disgustingly incompetent at care. Insecure, untrained ‘security’ guards fail to maintain hotel quarantine, and become virus spreaders instead. That is where outsourcing and privatising has got us.