Is the so called new economic thinking, same old stale stuff?

Frances Coppola writes a scathing critique of recently held Festival for New Economic Thinking in Edinburgh by Institute for New Economic Thinking.

I’m sitting in a coffee shop opposite Haymarket Station in Edinburgh. Just up the road, the Institute for New Economic Thinking (INET) is holding its conference. I’m supposed to be there, as I was yesterday and the day before. But I am not at all sure I want to go. The last two days have left a very bitter taste.

This conference, grandly entitled “Reawakening”, is supposed to be a showcase for the “new economic thinking” of INET’s name. I hoped to hear new voices and exciting ideas. At the very least, I expected serious discussion of, inter alia, radical reform of the financial system, digital ledger technology and cryptocurrencies, universal basic income (recently cautiously endorsed by the IMF), wealth taxation (also recently endorsed by the IMF), robots and the future of work. And I looked forward to the contributions not only from the speakers, but from the young, intelligent and highly educated attendees.

Not a bit of it. In the last two days we have had panel after panel of old white men discussing economic theories developed by old white men, many of them dead. Economic beliefs that I thought had been comprehensively debunked have reappeared, dressed up as “new thinking”.

She revisits all the panels and in unimpressed by most.

In the end:

For me, the ultimate insult came in the form of an announcement yesterday. INET is creating an Independent Commission on Global Economic Transformation. “Call for New Thinking and New Rules for the New World Economy; Final Report will Outline Solutions for Emerging and Developed Countries”, says the announcement. Here’s the remit of the new commission:

And here are the members of the Commission, so far:

  • Robert Johnson, President of INET and Former Chief Economist of the U.S. Senate Banking Committee;
  • Lord Adair Turner, Chairman of INET and former chairman of the UK Financial Services Authority;
  • Kaushik Basu, Professor of Economics at Cornell University and former Senior Vice-President and Chief Economist of the World Bank;
  • Peter Bofinger, Professor of Monetary and International Economics at Würzburg University and a member of the German Council of Economic Experts;
  • Winnie Byanyima, Oxfam International executive director; former member of the Ugandan Parliament, African Commission and Director of Gender and Development at the United Nations Development Program;
  • Mohamed El-Erian, Chief Economic Advisor, Allianz, and former chair of U.S. President Obama’s Global Development Council;
  • Dr Gaël Giraud, Economist and senior researcher at C.N.R.S. (French national center for scientific research); 
  • James Manyika, Director of the McKinsey Global Institute;
  • Rohinton Medhora, President of the Centre for International Governance Innovation (CIGI);
  • Danny Quah, Professor of Economics at the Lee Kuan Yew School of Public Policy, National University of Singapore;
  • Dani Rodrik, Professor of International Political Economy at Harvard’s John F. Kennedy School of Government, and President-Elect of the International Economic Association;
  • Eisuke Sakakibara, Professor of Economics at Keio University and former Japanese Vice Minister of Finance for International Affairs;
  • Beatrice Weder di Mauro, Professor of Economics, Chair of Economic Policy and International Macroeconomics at the University of Mainz, Germany and former member of the German Council of Economic Experts;
  • Yu Yongding, former president of the China Society of World Economics and director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences; former member of the Monetary Policy Committee of the People’s Bank of China.

Now, there are some wonderful people on this list. But collectively, they represent the elite establishment that I mentioned before: senior academics, rich businessmen, former and current public servants and policymakers. There are no new voices here, no-one from the heterodox economic community, no-one who has their feet in the real world. Everyone is at the top of an establishment hierarchy. How dare these people presume to take to themselves the responsibility for creating a radically new economic paradigm, when they have benefited so enormously from the existing one?

This is not “new economic thinking”. This is the establishment, reasserting itself at the behest of the elite, which fears the loss of its status and its privileges as the threat of populist revolt rises. The young crowd round the elite, hoping to be picked as their proteges: and the old scan the young to pick out the ones most like them. So the system perpetuates itself.  
And I, like the rest of the creatures outside, look “from pig to man, and from man to pig, and from pig to man again.” But already it is hard to say which is which. 

I had similar reactions on seeing the panel members. It looked quite similar to the Growth Commission floated a decade ago.

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