The Blindness of the Elite

http://www.theglobalist.com/storyid.aspx?StoryId=9093


U.S. Cultural Bias and New Economic Thinking

By Stephan Richter | Wednesday, April 20, 2011

The world badly needs a dose of fresh economic thinking. But current efforts are hampered by a cartel-like dominance of U.S. economists. After attending the recent Bretton Woods conference, Stephan Richter reflects on how to foster new economic thinking...

At the forefront was a hagiography of the U.S. economics establishment, with a prominent dose of Harvard shining through.

Ken Rogoff and many of the others, including the Financial Times’ Martin Wolf, were convinced of one thing: While it wasn't any longer the case of "Rule, Britannia, Rule," U.S. economics dominates the global firmament much as the U.S. Navy still rules the seas.

There is an underlying tenor that it's not even just a matter of resources and assets. No, the contention is held out that it's a clear case of intellectual superiority...


No wonder at times I felt as if I were at a Vatican-style conclave dominated by men who, while not robed in purple, embraced plenty of canonical thinking with great rigor.

There was a clear consensus that little could be learned from economies such as Germany and China. Those places are reduced to being described as economies playing with the system in an irresponsible manner.

Next to no space was given to the notion that, because the U.S. economy isn't any longer delivering the goods, that may have something to do with the underlying economic doctrines, which include plenty of research results for hire by Harvard faculty.

In the wake of the financial crisis, some concession was made that increased attention to the study of economic history in the vein of the late Charles Kindleberger would have been helpful. But that was pretty much as far as it went. If you can't capture the insight in the form of formula-heavy economics, it's still not worth having...


Rather than admitting even an ounce of self-doubt, it's much easier to blame the structural problems of the United States on foreigners. Apparently, it's foreign nations' export surpluses that keep American decision makers from smartly investing in education and infrastructure, creating a more balanced income distribution and the like.

These academics would be well-advised to heed the basic disclaimer in statements by mutual fund companies in advertising their hot funds: Past performance is no guarantee of future results.

And for all the undisputed qualities and achievements of the United States in past decades, this "fund" hasn't been performing for the American people in years...

 The blindness herein described is the calm before the storm: it is the hallmark of the Coming Irony, the Great Reversal which impresses itself on everyone's consciousness. Like the Tower of Babel, we are setting up the scenery for a very monumental act of our play. Hang on!