Recently, President Donald Trump announced the intent of the United States to withdraw from the Paris Accord. For some, this was a shock as there was an overwhelming consensus that climate change was, for one, real, and two, that there were time constraints in ensuring our survival as a species. However, what seems to be the small majority of people, those greedy or playing politics, is really part of a greater movement of what can broadly be classified as ‘anti-intellectualism’. Yet, this trend is hardly new, especially in the field of economics. So the question then becomes: how did we get here?
I could probably rant on and on about the historical context of the shift backwards from Keynesian to Neoclassical thought, given I am a New Keynesian (I have such ousted potential biases), but that’s not what actually bothers me about the field of economics today. The answer to the aforementioned question really comes from a more economic question: who has a demand for economics as a study? In today’s economy, two main types of employers exist. The first one: the government. As it has for nearly over a century, the government has employed economists not only in the macroeconomic department, to make decisions on the interest rate and such, but also as advisors to policy makers to better understand the effects of various policies concerning price controls, regulations, and other proposals they may have for an agenda in parliament or for their respective platforms. More recently, however, economists have also been increasingly employed in the private industry to better understand markets and economic trends in order to improve profitability.
Very often, these economists are handpicked by political actors as policy advisors, subsidized independent government advisors and academics. Hence, it is no surprise that they act, more often than not, in their own self-interest, and that we find ourselves listening to elected and appointed officials cite fairly illegitimate “economists”. This is probably why the American government still has found ways to convince a large portion of the general public that privatized healthcare has benefited the “common American”, despite the fact that, according to PBS, the average American household spends $10,350 as of 2015, spending the most among developed nations and yet has some of the worst health care coverage and quality .
These legitimized, though illegitimate, economists are not necessarily the ones that have the best ideas, theories or research, but rather the ones that are willing to vouch for ideas that serve specific private interests – ones that, more often than not, benefit specific interest groups (i.e. large, wealthy corporations) or, as we have seen through Brexit and the American election, ideas that political actors find relevant to flashy campaigns. (Though that is not to say there are no legitimate economists who have reasonable theories supported by reasonable data.) These economists’ ideas, sometimes shrouded in things like “secret data” or other violations of basic scientific principles, which some economists, like John Cochrane from the Stanford Hoover Institute , have decried, are being subsidized. This is at the opportunity cost of ideas that, while may not find themselves to be part of the campaign or corporate interest, may be in the best interest of the public. Unfortunately, these are effectively delegitimized.
The (alternative) fact in the matter is that economics is not a science whereby its academics have leeway to make much error- real policy is constructed from their data, which affect large populations of people in often life-changing ways. Good economics, based on transparent information, processed in transparent manners, with papers open to discussion and further investigation – is a merit good.
“The ideas of economists and political philosophers, both when they are right and when they are wrong are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist.”
– John Maynard Keynes