Blast from the past

Over 100 Chicago professors proudly sign a letter declaring their ignorance of economics:

Many colleagues are distressed by the notoriety of the Chicago School of Economics, especially throughout much of the global south, where they have often to defend the University’s reputation in the face of its negative image. The effects of the neoliberal global order that has been put in place in recent decades, strongly buttressed by the Chicago School of Economics, have by no means been unequivocally positive. Many would argue that they have been negative for much of the world's population, leading to the weakening of a number of struggling local economies in the service of globalized capital, and many would question the substitution of monetization for democratization under the banner of “market democracy.”

When the University of Chicago invests so heavily in culturally and politically conservative thought we wonder about its commitment to strong intellectual diversity in the tradition of the Kalven Report. Consider, for instance, the following passage in the Proposal to Establish the Milton Friedman Institute, which construes a certain orthodoxy as the starting point for any discussion: "Following Friedman’s lead, the design and evaluation of economic policy requires analyses that respect the incentives of individuals and the essential role of markets in allocating goods and services. As Friedman and others continually demonstrated, design of public policy without regard to market alternatives has adverse social consequences." Given the fact that our University is known for its commitment to interdisciplinarity, methodological diversity, and to discussion across political lines, some colleagues seek to secure these principles in both the structure and governance of the Institute and feel this commitment is belied by the Institute's founding documents. Some colleagues are disturbed by the specter of the University of Chicago becoming another Stanford, with the Milton Friedman Institute taking on the imposing campus presence of the Hoover Institution. Many of us are also perturbed that other units of the University that routinely engage the issues that the Friedman Institute is designed to address were not included in the planning, nor included in the ongoing core scholarly endeavors of the Institute.

This from a University that has cultivated a reputation as one of the most intellectually rigorous campuses in the country. I'm tempted to weep.

Where to start with this festival of willful misunderstanding? I was surprised to hear that Milton Friedman is reviled in "The South", since I follow the Argentinian, Venezuelan, and South African economic press closely-ish, and I've never once heard the man's name mentioned. The only country that seems aware of his existence, or that of the "Chicago Boys" is Chile, and they kind of like him.

Second, their assessment of the effects of the "neoliberal global order" is forehead slapping, head shaking, did-they-really-say that? stupid. I haven't heard such transparently wishful claptrap since my fifteen-year-old boyfriend tried to convince me that sex provided unparalleled aerobic exercise. If you put all 100 in a room with unlimited access to Lexis-Nexis and a mountain-sized peyote stash to bring their quasi-communist fantasy life into 3D technicolor, they still couldn't name a country where neoliberalism has undermined a vibrant democracy. Nor where Demon Capital has made things worse. The worst you can say for the neoliberal order is that it doesn't make things better the way we hoped it would. Any place you can name that has been deeply screwed up since global capital arrived was at least as corrupt and otherwise awful before the capital swooped in to plant garment factories in the edenic swamps of rural poverty.

The last paragraph makes these eminent professors seem, to put it charitably, not quite bright. Otherwise, how does one find a statement like this inflammatory?

Following Friedman’s lead, the design and evaluation of economic policy requires analyses that respect the incentives of individuals and the essential role of markets in allocating goods and services. As Friedman and others continually demonstrated, design of public policy without regard to market alternatives has adverse social consequences.

Do they think that we should do analyses that doesn't pay attention to individual incentives or the role of markets in allocating goods and services? Are they under the impression that there is still a debate on this? I thought the fall of the Soviet Union had rather spectacularly demonstrated that it's hard to allocate goods and services without markets. Indeed, one wonders where all these professors get their groceries.

Or perhaps they merely think that we should design our policies without regard to market alternatives. Not even the commissars managed that; you can't even reject markets without regarding them.

It's foolish to get enraged at these powerless twits. But someone has to writhe in shame at this folly, and clearly, their intellects aren't up to the task.