Macroconomics is the sick man of academia. Every 10 years or so, an unforeseen crisis hurls the world into turmoil, or a prediction, like the immediate collapse of the British economy after Brexit, rings blatantly untrue. Accustomed to similar disappointment from the optimistic weatherman or an incorrigible lover, the public loses faith in so-called experts. This malaise is potentially more fatal than merely incorrect predictions. Economics has forsaken its moral foundations of achieving the greatest good for the greatest number in an Icarus-like pursuit of mathematical objectivity. It’s the duty of the Yale Economics Department to reorient toward what Adam Smith, John Stuart Mill and John Maynard Keynes all knew too well: Economics is primarily a moral science.
It is worthwhile to start by asking a question that has bothered me ever since I started reading economics at Yale: How can there exist left-wing and right-wing economists? In other words, how does ideology influence the workings of a so-called empirical science? Analogize to one of the harder natural sciences — imagine a Marxist physicist shamefacedly claiming truth of how the world works, and asserting that gravity is yet another back-breaking tool in the arsenal of the bourgeoisie. Incidentally, the Soviet Union did place ideology before science. Soviet scientists disastrously, and hilariously, refuted Darwinian evolution because it contradicted the state’s interpretation of Marxism.
For economists preconceive the world they supposedly study and economic observation has only two guides — a moral outlook on how the world ought to be and cold, hard, empirical facts. Hume recognized the very human experience of the interior pilot guiding the accumulation of knowledge, writing: “Reason is, and ought only to be, the slave of the passions.” Values are functions of sorts. The data economists consume may be identical (the more likely error is selection bias in a complex economy) but the output is always different. When Paul Krugman argues for a more generous welfare state while Friedrich Hayek argues for the opposite, their readers learn less about the objective state of the economy and more about an opinion of how it should work. This argument applies to all social sciences. But because economics holds disproportionate sway over policymakers, we must hold it to a higher standard.
But at Yale, we don’t. Yale economics students learn the math of interpreting markets at the expense of the history. You can be an econ major without ever studying the monstrous, violent crimes of the past that led to the creation of markets and property rights—colonialism, slavery, genocide, apartheid.
The laws of economics are treated as monolithic rules of the universe, creating a false sense of timelessness. The reality is that, while the law of supply and demand is beyond dispute, the initial allocation of property rights occurred in the the messy, barbaric orgy of the violent time before we were born, when Europeans slaughtered their way to prosperity. It’s impossible to understand economic theory without understanding the conditions that gave rise to the modern world, which somehow Yale’s Economics Department fails to require.
Think only of the origins of the phrase “the dismal science”. When we hear that apt saying, we think it refers to the poor predictability of economics. The dark origins, however, are much closer to the truth of capitalism’s awful racist beginnings. In his 1849 work “Occasional Discourse on the Negro Question,” Scottish historian Thomas Carlyle argued for the reintroduction of slavery in the West Indies, claiming the unavoidable ghastliness of economics. He wrote: “Not a ‘gay science,’ I should say, like some we have heard of; no, a dreary, desolate and, indeed, quite abject and distressing one, what we may call, by way of eminence, the dismal science.” Forgetting the racist origins of this phrase attests to a callous amnesia eroding the moral pillars of the discipline of economics.
Academia fixes this bind either through humility or democracy. By humility I mean to say that economists should not claim ultimate knowledge over how the world should work. They should be more explicit that most models are flawed, that models have assumptions about how the world ought to be and that disagreement over those assumptions (like the justness of the advent of property rights) is the real telos of a free, discursive society. The way we want to realize a better world precedes any stale economists warning of the effect on that deeply flawed metric of gross domestic product.
By democracy, I mean that economists should reinvigorate the belief of its intellectual founders that the purpose of the economy is utilitarian, that all governments have the duty to promote the greatest good of the greatest number. If modern democracies are not to be shams, if they are to aspire to real freedom, they can no longer ignore the coercion of millions born into poverty, and millions more burdened by debts.
Economics helps us understand the broad strokes of our political choices. A democratic vision of economics would focus on how to make property rights more just and equitable. And fundamentally, this requires an accounting for history. Economists around the world, and future ones at Yale, should take up this cause instead of hiding behind a pretense of we-know-best.
Adam Krok is a junior in Saybrook College. His column runs on alternate Fridays. Contact him at firstname.lastname@example.org .