Who let the economist out?

This is an ouch piece by Jinoy Jose P in Business Line.  It reviews the recent book by Binyamin Appelbaum, of The New York Times: The Economists’ Hour: How the False Prophets of Free Markets Fractured Our Society.

Why did God create economists? “To make weather forecasters look great.” Jokes apart, the jury is still out on whether economists have made any significant and meaningful contribution towards greater common good, especially whether they have really been able to foresee or forestall economic crises. As they say, most of the tom-tommed economists have been so ‘successful’ at predicting financial crises that they have forecast 11 of the past eight financial crises in the past 40 years.

What’s funnier is that despite all the mighty mishaps that wrecked economies, businesses and, most importantly, lives of billions of common people across the world, economists command immense clout in policy-making worldwide and many of their ‘chic’ and controversial decisions continue to wreak socio-economic havoc.

This is not to say all economists are fake and all of economics is hokum. From Adam Smith, Karl Marx and John Maynard Keynes to Amartya Sen and Thomas Piketty, there have been an eclectic mix of economists whose ideas have changed the world in unimaginable ways,helping lift millions out of poverty. But not many of them won awards or went on to chair panels that created policies. In fact, a lot of them are still underrated and most of the overrated and popular economists are, sadly, doing counterproductive work that create economic disparity and inequality in society.

Popular among them are the champions of the free market. As Binyamin Appelbaum, an editorial board member of The New York Times, writes in his well-timed and well-researched new book, The Economists’ Hour: How the False Prophets of Free Markets Fractured Our Society, “the triumph of free-market economics is sometimes illustrated by a satellite image of the Korean peninsula at night, the southern half illuminated by electricity, the northern half black as the surrounding ocean.”

Which means, lying adjacent to all the glossy prose we read about the success of the free market in bringing prosperity to its benefactors is the story of a dark continent of extreme inequalities and poverty that nobody really cares about.

The 2008 crisis wrecked the profession of economists and the effects of it continue…

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