Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown by Mirowski Philip

Author:Mirowski, Philip [Mirowski, Philip]
Language: eng
Format: epub
Publisher: Verso Books
Published: 2013-07-09T00:00:00+00:00

5

The Shock of the New: Have Neoclassical Economists

Learned Anything at All from the Crisis?

Picking Up the TINA Pieces

I can sympathize with those who feel that the last thing they want to do in the aftermath of the current crisis is revisit the corpus of ideas emanating from the neoclassical orthodoxy. Picking over the bones of the decrepit doctrines that inspired one misstep after another would seem the very height of bathos, if not specious distraction. In any event, serious foraging would teeter on the edge of yet another stripped-down history of orthodox macroeconomics, a massive undertaking better conducted by others.1 Here we aim at something different. Given our ultimate objective is to understand the unreasonable resilience of the neoliberal Weltanschauung, and the role of the economists in fortifying it, I propose to concentrate on aspects of economics that have confused or otherwise obscured specific components of economic knowledge in the heat of the crisis and thereafter. In this, we further explore the phenomenon of “agnotology” raised in the previous chapter, growing out of the fundamental internal contradiction between trusting the economists to point the way out of the crisis, and trusting the markets to right themselves. Of course, in the midst of global crisis and upheaval, some economists might have become disoriented, and say some things that they might regret in quieter times. We have already raised the specter of cognitive dissonance and the Festinger effect; henceforth we just take it for granted that a substantial proportion of true believers would opt for a state of denial. A certain modicum of sympathetic indulgence (or at least, impartial spectatorship) is indispensable, or else the intellectual history of the crisis would degenerate into a serious of pointless “gotcha” exercises.

In that spirit, we might divide the reactions of the economics profession to the crisis into three broad categories: one, the orthodoxy was right all along and nothing that has transpired in recent events impugns the fundamental soundness of basic theory; two, the orthodox have made some unfortunate conceptual choices in the recent past, but the crisis has sobered us up, and we are working hard to rectify them, while maintaining fealty to all that was legitimate, timeless and dependable in neoclassical economics; and three, the best response would be to renounce neoclassical economics altogether, and start anew with some other tradition of economic thought. The first response was primarily dealt with in chapter 4. The second response is more difficult to characterize through any brief summary, and is the topic of the present chapter. The third response is the project of which this volume serves as preamble: it derives from a conclusion that renunciation of neoclassical economics is the only serious way forward to oppose the zombie fortification of modern neoliberalism. Precisely because the third option is such a disparaged minority position, we first have more work to do to improve its appeal.

To prepare the ground, we shall have to deal with the contemporary majority view that opposition to neoliberalism does not require

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