Portcullis House Press Release

Rethinking Economics, the Manchester Post-Crash Economics Society and the Cambridge Society for Economic Pluralism (CSEP) met with MPs and economists at Portcullis House on Weds 5th February.
Rafe Martyn (CSEP), Maeve Cohen (Post-Crash) and Yuan Yang (Rethinking Economics) spoke about the history of the groups, the problem with a narrow focus on neoclassical economics, our position on curriculum reform and the INET CORE Project, and the national and international campaigns for curriculum reform.

About the Groups

The first Rethinking Economics Conference was organised at Tubingen University, Germany in 2012. Rethinking Economics UK was then established in 2013. With an INET YSI grant, they ran the Rethinking Economics Conference at Birkbeck College and LSE, London in 2013 and a smaller, parallel conference in Tubingen. Rethinking Economics is now a network of groups with conferences planned in London and New York in 2014.

Post-Crash started in Manchester at the beginning of the 2012-13 academic year. They have organised speakers such as Steve Keen, run a heterodox lecture series alongside an alternative economics module and seen similar groups start up in other universities.

CSEP was founded in November 2011. The society’s inaugural event was a packed talk by Sheila Dow in March 2012.  Since then CSEP has hosted academics from inside and outside Cambridge, started reading groups, a student debating league and a ‘NOT in the Curriculum’ programme that introduces undergraduates to some neglects of neoclassical economics.

A Lack of Pluralism

The Financial Crash in 2008 was a systemic crisis for mainstream economics. Five years later the debate has a distinct lack of economic alternatives or narratives: the debate can be exclusionary and misleading. This systemic crisis extends beyond universities and into the public and political debate surrounding the economy.

This monoculture is damaging when the public relies on experts to mediate economic discussion: economists have huge influence over the public narrative. The state of the economy is of central importance to society, which requires us to frame the debate critically and question the foundations, assumptions and practices.

The International Campaign

We are campaigning to diversify and demystify economics, and to provoke public debate. We are collaborating with PEPS-Economie and the German Pluralist Economics Network who have previously published curriculum reform proposals. For example, Plurale Oekonomik published an Open Letter in 2012 calling on the German Economic Association for curriculum reform. Academics, such as Victoria Chick, have made similar calls (see Denis, 2009).

These manifestos share similar points: having better links with real-world problems; less dominance by mathematical methods; questioning of ethical assumptions and the social responsibility of economists; more humility, self-awareness and critical reflection in their research. The central reform is for theoretical and methodological pluralism in the discipline, such as the inclusion of economic history, the history of economic thought and links to other social sciences.

Student Quotation

"As a postgraduate, I attended a UK research conference recently that asked how financial models can be re-interpreted in light of the 2008 crisis, yet hardly any of the attendees were economists. The behavioural economist presented decades of his research which told an inconvenient truth about the profession: that the micro-foundations project is a failure. Not only is the 'sum greater than the parts', but human behaviour is neither rational nor optimal. In any other profession his empirical work would be celebrated as ground-breaking and innovative, yet he told us he had been sidelined by his profession. This is why we need a more open, pluralistic approach to economics'

Reference

Denis, A. (ed.) (2009), ‘Pluralism in economics education’, Special Edition of the International Review of Economics Education, 8(2), 23-40

Cardinal Marx rethinks economics

Author: Henry Tugendhat

The Catholic Church’s new leadership has come out strongly against neoclassical thought, its lack of engagement with moral philosophy, and its impact of poverty. Their message is a welcome contribution to the post-crash debate on how we might refocus economic policy around moral principles.

“The collateral damage of capitalism is not acceptable” stated Cardinal Marx at a lecture hosted by St. Benet’s College, Oxford (Feb 11th 2014). Neoclassical thought “is a utilitarian view of economics that tells us some may suffer and we may get increasing income inequalities, but in the long run we’ll all be better off… this [utilitarian approach] is exactly what the communists did before!”

Cardinal Marx’s latest book, ‘Das Kapital: A plea for man’, elaborates these criticisms against the almost religious application of singular economic schools of thought such as Marxism and Neo-Classical economic theory at present. That said, he still draws lessons from both of these schools among others to focus his economic thinking around Catholic teaching. Ultimately, as he told the Oxford audience, “the church’s social doctrine is not against markets, but against utilitarian economics":

With views like this, one might think he represents a minority in the group of the Catholic Church, however his responsibilities have increased enormously under the new Papacy. He is the archbishop of Munich, the head of the European Union Bishops’ Conference Association, and one of the new Pope’s most trusted inner circle of 8 Cardinals responsible for Church reforms.

It is surely no accident that Pope Francis should have chosen him to be one of the front-line leaders in his assault on poverty. The new Pope’s own choice of name, Francis, speaks volumes about his commitment to the poor, and he has grabbed headlines with his relatively austere lifestyle in comparison with papal predecessors. But what is most significant, is that he has chosen to re-engage with poverty at the level of the political economic debate.

For decades, Rome stepped out of economic discussions. It had already condemned the atheism of many Communist movements in the 1930s, so when the Cold War settled in, this among other reasons led to the leaders of the Church to side with the West. As Western nations increasingly associated themselves with neoclassical economics, church leaders saw no reason to intervene.

That said, there were still movements within the Church that critically engaged with the moral philosophy surrounding economics such as the liberation theologists in Latin America, key Catholic politicians who favoured socialist policies such as Julius Nyerere, and even some links between the Communist Party and Catholic Church in France. 

Pope Francis (or Jorge Bergoglio as he was known then) never associated himself with liberation theology despite its popularity with many Argentinians. Instead, he has been accused by some in Argentina as complicit with the Videla dictatorship of the 1970s. In any case, there is no doubt that there are traces of his current views amid the melting pot of economic ideas in Latin America since the 1960s.

With the arrival of Pope Francis to the Holy See, the question of a moral economy has been brought squarely back into the debate. On May 1st last year, Francis came out to condemn the “slave labour” under which the Bangladeshi textile workers died: “today many social, political and economic systems have chosen to exploit the human person [in the workplace] by not paying a just (wage), not offering work, focusing solely on the balance sheets… only looking at how much I can profit. This goes against God!” In November last year he published the Apostolic Exhortation ‘Evangelii Gaudium’ that called on his faithful to see the very real moral consequences of our current economic frameworks.

This, along with Cardinal Marx’s own exhortations against “utilitarian economics”, makes a very useful contribution to the post-crash crash debate, as well a case for pluralism. Pluralist economics might best be described as drawing from a selection of economic schools of thought, as befits the situation at hand, and therefore serve humanity better. It can do this with a focus on human well-being, a green economy, or as we see here, the ethical imperatives. So although the Church does not apply the scientific rigour as put forth by some, it is still taking the crucial first step of cleaving open the debate on why we should break out of mono-paradigmatic views of the world.

As the first Pope to be elected since the financial crisis, this is a significant time for Francis and his inner circle to be shaping the economic debate within the Catholic community. His criticisms of the policies and culture surrounding the modern financial sector certainly go back to the 2001-02 Argentinian banking crisis which he blamed on the “crudest form of liberalism”. Keen to lead by example, the Pope has actuated reforms on the Vatican’s bank (rather mysteriously named the Institute for the Works of Religion) to open it up to external auditing and scrutiny.

Ultimately, the Church is making an ethical contribution to the post-crash debate in that it argues for some form of moral philosophy to be brought back into our economic thinking. Certainly they are still mired in a number of other controversial debates with important social impacts, such as transparency over child abuse cases. This article is also by no means a clarion call for the church to get back into statecraft. However, we should welcome the fact that the spiritual leaders of 1.2 billion people around the world are now boldly and publically rethinking economics.

Post-Crash, CSEP and Rethinking Economics met with MPs and Economists on 5th Feb

Rethinking Economics, the Manchester Post-Crash Economics Society and the Cambridge Society for Economic Pluralism (CSEP) met with MPs and economists at Portcullis House on Weds 5th February:

Rafe Martyn (CSEP), Maeve Cohen (Post-Crash) and Yuan Yang (Rethinking Economics) spoke about the history of the groups, the problem with a narrow focus on neoclassical economics, our position on curriculum reform and the INET CORE Project, and the national and international campaigns for curriculum reform.

Other Attendees

Alex Andrade (SOAS), Adrià Porta Caballé (University of Essex), Alicia Krozer (CSEP), Neil Lancastle (University of Leicester), Diana García López (CSEP), Hoang Nguyen (UCL), Marco Schneebalg (CSEP), Daniele Tori (University of Greenwich), Sam Wheldon-Bayes (SOAS), Preeti Varathan (CSEP).

The economists and MPs present included Michael Burke, Victoria Chick, Caroline Lucas, Michael Meacher, James Meadway, Jo Michell and Özlem Onaran.

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