Friday, January 15, 2010

Economics as theology and propaganda

RDan Linda Beale quotes Maxine Udall on Casino-like finance:
The defunct [classical "freshwater"] economists have provided a convenient narrative in which government of, by and for the people can never act as a countervailing force against large corporations, but instead is viewed as promoting individual freedom only when allied with and strenuously promoting the financial well-being and increased power of those very same large corporations.

Beale goes on:
All of a sudden in "law and economics" [Beale's student] had found a theory that claimed to explain everything based on what was asserted as intuitively appropriate self-interest rationales--not just why markets are important, but also how tort law should work, and contracts--efficient breaches are fine, even if you do break your solemn word--, and even constitutional law (Gary Becker's unconvincing work suggesting that discrimination will disappear if one only trusts in markets). With that theory in hand, he had stopped asking questions and just started applying. It made it all so easy. Greed is go; fairness is in the eye of the beholder; efficiency is king. Wealth shouldn't be condemned; instead, condemn the lack of responsibility in the freeloaders who beg for handouts. Bigness isn't a problem--corporations wouldn't get so big if the market didn't make it possible, and since they are big, the markets have spoken.

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