The Economist’s Power to Influence Policy

[Pieter de Beer]

According to a paper published in 2014, written by Assistant Professor of Sociology at Brown University, Daniel Hirschman, and Associate Professor of Organizational Studies and Sociology, University of Michigan, Elizabeth Popp Berman on (Twitter as @epopppp). There are 3 main ways we can see the influence of economists on society

1) Professional Authority –  if economists enclose domains of knowledge, and define these as their own territory, they will eliminate much of the rest of the advisory pool from consideration.

2) Institutional Positions – By attaining high ranking or even head positions at various institutions, such as bureaucratic ministries, governing agency, IMF, WTO, the Whitehouse CEA, and as well as Federal Banks, they can actually directly set policies themselves

3) Cognitive Infrastructure – This is another indirect form of influence. By spreading the Economic Style of thinking into various fields of study, especially law and political science, Economists can determine the definitions, and influence the technical devices (like GDP) that then get subsequently used by non-economists working in policy advisory positions

In essence, while these 3 are distinct, they also overlap and interlink, but can be used to analyze the Economist’s/Economic influence on policy creation

Obviously every school of economic thought can achieve and wield such influence, but has anyone looked into defining the Epistemic Community of Economists that have the most power and influence by looking into these 3 methods?

I would say that there are individuals like Prof Steve Keen, who is now running for political office, that is aiming to achieve all 3, although the total of one person compared to an entire community of economists, would necessarily be limited.

How is CasP working toward achieving some measure of influence over prevailing thought in the realm of Political Economy?

• This topic was modified 3 years ago by Pieter de Beer.
• This topic was modified 2 years, 12 months ago by Pieter de Beer.

Topic

[Blair Fix]

Interesting thoughts, Pieter.

When it comes to policy, capital-as-power research is in a very different place than most economics research. Since CasP research focuses explicitly on analyzing power, it is most practical for bottom up activists who are critical of power. Using CasP research to implement policy (i.e. wield power) would be odd … kind of like an anarchist becoming a CEO. When you’re critical of power, you are self selected from becoming powerful.

That said, I do hope that CasP research becomes influential among the non-powerful. If it ever became widely recognized, it would be a sign that capitalism is in trouble.

[Pieter de Beer]

Blair Fix wrote:

Since CasP research focuses explicitly on analyzing power, it is most practical for bottom up activists who are critical of power.

This is precisely the kind of policy influence I am hoping to see articulated by CasP theorists. If those with a clear understanding of the inequities of accumulated power are influencing policy for movements that aim to dismantle hierarchical structures of power that currently dominate, then a CasP framework should be able to articulate what to avoid, if not how to actually build and implement policies that are more equitable.

Blair Fix wrote:

Using CasP research to implement policy (i.e. wield power) would be odd

Using an example from the research I posted originally, one of the mechanisms used by main-stream economists to influence policy now, is Economic Devices like GDP. Your own work has shown what utter nonsense GDP is, and we’ve seen plenty of evidence that economic growth is the opposite of a good thing. So in CasP policy implementation, let’s assume that the CasP Power Index were to be used as a device in the shaping of policy, such that minimum and maximum power caps were set, with a maximum Power Index difference to be strictly adhered to, and that an Organisation like the IRS, were to enforce such a policy, Taxing the wealthy, and redistributing the wealth to those without power, and that Corporate governance were also required to adhere to these “power equalizer” policies.

I think I have come to the conclusion that power itself is not the problem, but that having power structures that cannot be dismantled, or that are so deeply institutionalized that we are fearful of disentangling them, is the problem.

I am very quick to admit that I don’t think CasP has developed far enough, or deeply enough, to provide a building framework for setting up policy devices, or providing sufficient cognitive infrastructure to allow for bottum-up movements to propose adequate policies, let alone for any CasPer to assume an institutional position and implement any kind of policy directly… But I do think that it is an avenue worth exploring

[Anthony LaMantia]

I’m not convinced that CasP becoming (more) influential would necessarily be a sign that capitalism is in trouble.  If anything, capitalism has proven to be quite surprisingly adaptive in the face of challenges from within and externally.

I believe social and economic policy can be a force for good, and bottom-up power can manifest in many forms to transform societies. Vaclav Havel’s The Power of the Powerless (part of Without Force or Lies along with contributions of other social activists that helped lead the “Velvet Revolution”/democratization in Eastern Europe in the early 1990s) was replete with simple ideas that mobilized people in many of the former Eastern-bloc countries. It was a transformative and hopeful time, and not just for western observers.

Having said that, 30 years later, democratization and capitalism for these countries has had a very uneven and (mostly) predictable pattern of state power and dominant capital corrupting those with even the most noble intentions, with a number of these countries falling back in autocracy–a kind of “meet the new boss, same as the old boss” phenomenon.

Let’s try blowing up one ridiculous economist article of faith (myth) at a time–i.e. imagine the CasP view on inflation becoming the new conventional wisdom and how that might be used to regulate/impact firms’ ability to indiscriminately raise prices…just because they can.

BTW, I am a CEO.

 

 

 

 

[Scot Griffin]

Blair Fix wrote:

Interesting thoughts, Pieter. When it comes to policy, capital-as-power research is in a very different place than most economics research. Since CasP research focuses explicitly on analyzing power, it is most practical for bottom up activists who are critical of power. Using CasP research to implement policy (i.e. wield power) would be odd … kind of like an anarchist becoming a CEO. When you’re critical of power, you are self selected from becoming powerful. That said, I do hope that CasP research becomes influential among the non-powerful. If it ever became widely recognized, it would be a sign that capitalism is in trouble.

Is CasP really critical of power, generally? At the end of the day, power is unavoidable. The real issue is how power is distributed, and I’d argue that CasP critiques how capitalism distributes and organizes power, not the fact of power itself.

CasP is in a position to become influential among both those with power and those without, if we can find the right narrative construct. For example, MMT is increasingly influential with Congressional Democrats, and I don’t think it should take much to demonstrate that CasP provides a better lens than MMT through which to set fiscal and monetary policy.

[Scot Griffin]

Pieter de Beer wrote:

Using an example from the research I posted originally, one of the mechanisms used by main-stream economists to influence policy now, is Economic Devices like GDP. Your own work has shown what utter nonsense GDP is, and we’ve seen plenty of evidence that economic growth is the opposite of a good thing. So in CasP policy implementation, let’s assume that the CasP Power Index were to be used as a device in the shaping of policy, such that minimum and maximum power caps were set, with a maximum Power Index difference to be strictly adhered to, and that an Organisation like the IRS, were to enforce such a policy, Taxing the wealthy, and redistributing the wealth to those without power, and that Corporate governance were also required to adhere to these “power equalizer” policies.

Econometrics like GDP serve to further the goals of dominant capital. It is not enough to “debunk” them, you need to explain why they are dangerous in and of themselves (e.g., they focus on you on one thing to the exclusion of other things that might be more important), and it is not clear that replacing capital-friendly econometrics with neutral econometrics would further the goal of dissipating or preventing the accumulation of power. After all, the capitalism we have today is largely due to Karl Marx because dominant capital is a living thing that reacts and adjusts to the circumstances it faces. Neoclassical economics was a reaction to Marx, for example, as was neoliberalism.

Speaking of GDP, Dirk Philpsen has written a book all about GDP called The Little Big Number: How GDP Came to Rule the World and What to Do About It that might be of interest (it is one of many books in my queue).

I think I have come to the conclusion that power itself is not the problem, but that having power structures that cannot be dismantled, or that are so deeply institutionalized that we are fearful of disentangling them, is the problem.

I’d argue that most people are not aware of these power structures, and those that are either want to disentangle them or further entrench them. CasP, like Marx in his time, offers a new way of understanding society that should be able to get everyone to see those power structures for what they are and to drive consensus to change them. We cannot do that without getting beyond the “debate” (capitalism v. socialism) as currently constructed.

I am very quick to admit that I don’t think CasP has developed far enough, or deeply enough, to provide a building framework for setting up policy devices, or providing sufficient cognitive infrastructure to allow for bottum-up movements to propose adequate policies, let alone for any CasPer to assume an institutional position and implement any kind of policy directly… But I do think that it is an avenue worth exploring

CasP currently lacks a theory of praxis. See the discussion in Theory and Praxis, Theory and Practice, Practical Theory. by Debailleul, Bichler and Nitzan.

For now, CasP seems mostly limited to identifying how capital manifests itself as power (e.g., the Power Index; two regimes of sabotage; hierarchy) and how capital’s power waxes and wanes (e.g., the Systemic Fear Index). While there is no reason that CasP must remain in this state, Bichler and Nitzan articulate many reasons why it is likely to do so for quite some time, largely because dominant capital will have a say.

 

[Rowan Pryor]

I think economists are like any technicians and any workers. They do what they are paid to do by capital (by the owners of large amounts of capital). They are paid to set up systems that favour the owners of capital. They are paid to issue the propaganda that justifies the operations of capital and the actions of owners of capital. John Ralston Saul said “Economics should not lead society. It is a fourth order discipline.” This is if I recall his words correctly. I agree with J.R.S. that there are disciplines more important than economics. I would nominate moral philosophy or ethics, democracy, science and history, at least. However, his assumption that conventional or bourgeoise economics “leads” society is wrong I think. The possessors of large amounts of capital lead our society with the power of capital. Economics provides the signal and switching system (and the window dressing).

[Author]

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