Bootstraps

JK Galbraith, writing circa the election of Reagan, made this observation (from “The Conservative Onslaught”):

That a large share of all economic comment comes from people of comfortable means will not be in doubt. High social, business, and academic position gives access to television, radio, and the press. And professional access to the media also gives a relatively high income. It follows that the voice of economic advantage, being louder, regularly gets mistaken for the voice of the masses. On the need for tax relief, investment incentives, or a curb on welfare costs, the views of one articulate and affluent banker, businessman, or acolyte economist are the equal of those of several thousand welfare mothers.

I want to use this observation to raise an issue different from the one Galbraith was addressing.

I have long suspected that mainstream economics is an ideology – a set of justifications and rationalizations of the status quo, dressed up to look scientific, engineered by the status quo’s beneficiaries in order to safeguard the wealth which it bestows on them.

I have suspected that mainstream economists want “free markets” – in both developed and undeveloped countries – because “free markets” make them and their (mostly corporate) cohorts very comfortable, indeed. These economists are warriors in a class struggle, and their primary weapons are the graphs, equations, and “laws” that every attentive freshman knows so well.

What raised this suspicion initially, and keeps it alive today, is the regularity with which attempts to aid the less fortunate and redistribute wealth are swarmed by self-assured economic analysts prepared to demonstrate that the attempt will blow up in the face of those who make it via interference with a “free market”. Also peaking my suspicion is the regularity with which attempts to reign in corporate malfeasance and market interference are swarmed by (usually the same) self-assured economic analysts prepared to demonstrate that corporations ferment wealth in all sorts of ways and ought not be constrained by distorting regulations.

These orthodox – and yes, conservative – arguments are easy to recognize, especially after Hirschmann classified them in his book “The Rhetoric of Reaction”. Time after time, conservative economists argue that redistribution or welfare program x will have the opposite of its intended effect, will interfere with established liberties, or will have no effect at all.

Another cause of suspicion, which you will notice if you observe carefully, is that many, if not most, of these arguments are made by people associated with obscure organizations, usually LLCs, with vague, innocuous names that often include the word “liberty”. These organizations are think-tank corporations, essentially paid by big business to contrive arguments against tax-and-transfer programs and other attempts at increased social welfare.

I do not want to engage in conspiracy theory here. However, ideology has choked collective welfare in the past, and there is no reason to believe that it has disappeared. Ideology uses the binding principles of the day, accepted by almost everyone, to argue in favor of social, political, and economic arrangements that benefit a very few. An example of this is the famous “divine right” theory of monarchy in the 16th and 17th centuries. This theory was used to justify and rationalize oppression by kings and queens. Perhaps the most important thing about the “theory” is that it would not have worked if most people did not believe in God.

Just as ancient monarchs furthered their political agendas using popular theology, I suspect that modern economists and business interests further their own agendas using a healthy mixture of popular political sentiment, centered on “liberty”, and somewhat intimidating economic “analysis”.