Nobel Laureate economist Angus Deaton has delivered a ferocious rebuke to his own profession, saying economists have failed to understand that capitalism is about power.
  • quarrk [he/him]
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    8 months ago

    “Historians, who understand about contingency and about multiple and multidirectional causality, often do a better job than economists of identifying important mechanisms…”

    This is why politics, economics, and history should not be studied independently. It’s why Marx’s critique of classical political economy was that it lacked historical specificity. If economic laws are investigated in the same way as natural laws of physics or biology, then they will appear natural and unchangeable. But economies do change over time, they aren’t eternal and therefore can only be accurately understood in historical context, as transient laws of the current time and place.

    • Greenleaf [he/him]
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      8 months ago

      Yep. From even before Adam Smith up through Marx, economics wasn’t really this separate discipline. The social sciences were interdisciplinary, and people who studied political economy understood it in a broader context.

      But the “problem” was, those political economists (certainly Marx yes, but plenty others; Marx didn’t operate in a vacuum) started to draw some uncomfortable conclusions about capitalism. In comes the marginalist revolution and neoclassical economics. While a lot of these marginalist economists did go on to criticize Marx specifically (i.e. Bohm-Bawerk), really I don’t see the marginalist legacy as something that attempted to “debunk” Marx & co per se. More about ending political economy as a pursuit, and narrowing the focus of “economics” on things like government fiscal and monetary policy. Even in the “debate” between subjective and labor theories of value, I don’t think the SVT is even “wrong”, it just doesn’t tell us anything interesting. It basically says we’re not going to trouble ourselves with understanding the bigger things, we’re just gonna say that wherever price and quantity intersect in a stable situation is “equilibrium”. Killing political economy was what capital needed to get people to stop questioning the economic system and instead focus this new “economic” science on how to be a tool for capital.

    • PorkrollPosadist [he/him, they/them]
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      8 months ago

      Even in disciplines like physics, it is known that one simple set of rules can not be extrapolated to explain all circumstances. The study of aerodynamics separates mechanics into several 'regimes,' because things behave quite differently under subsonic and supersonic conditions. A similar dichotomy exists between traditional Newtonian mechanics and relativity. If the market oracles getting spit out by the Chicago School are treating economics like physics, they are the type of physicist who still upholds the plum pudding model.

      • quarrk [he/him]
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        8 months ago

        they are the type of physicist who still upholds the plum pudding model

        It’s worse than that, even. The plum pudding model IIRC was always understood to be an approximation.

        Vulgar economy is less forgivable. It is essentially anti-scientific, by rejecting the possibility of economic laws which are not identical with appearances. The vulgar economists are like astronomers still clinging to the Ptolemaic system (geocentric model), because the sky in fact appears to rotate about the earth. Marx here plays the role of Galileo, using science to prove that there are deeper laws governing the motions of celestial objects.

  • Justice@lemmygrad.ml
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    8 months ago

    My (apparently) most controversial take is economics in the way it's discussed with a capitalist framing by economists is made up. Literally none of it is based in reality, and it's just used to enrich capitalists and act as a barrier to actual change for the benefit of all humans. Eg "The GDP of the USSR in 1955..." type shit that I somehow see people "on the left" saying a lot. It's so prevalent in society to think of everything in these bullshit terms and ways and locks everyone into this mindset of "but if GDP no go up... how good?" Shit just annoys me.

      • D61 [any]
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        8 months ago

        me screaming Ceteris paribus in a crowded lecture hall as I slowly shrink and turn into a cob of corn

      • Greenleaf [he/him]
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        8 months ago

        GDP made a lot more sense to me after I finished vol. 2 of Capital. In a very loose and non-literal sense, I think GDP reflects the amount of surplus value floating around in an economy. The US has a high GDP but when you consider that production is the only source of value (that’s part of where vol 2 comes in) how does that make sense? It’s because the US “steals” surplus value from the global south. The US economy (the non-financial part of it, at least) is a merchant capitalist economy. The US doesn’t make anything - Nike, Apple, Gap, Walmart, etc… none of them make hardly anything in-house much less in the US. Contractors in the global south are where most of the production happens and thus that’s where the value is created, but the hegemonic position of the US as sort the the ultimate merchant capitalist with nuclear weapons , means the production side gets squeezed out of their surplus value and it’s moved to the US with the product. And GDP largely aligns with these flows of value, products, and money.