The Trouble with Economics: William Nordhaus and Pope Francis

Economics is perhaps the one social science “profession” that is most entrenched in the political economy of contemporary nations. Little economic thought escapes the halls of academia without the neoliberal stamp of theoretical approval. The trouble with most of the social sciences is that it is very difficult for them to actually be scientific. In the first place, complexity is amplified exponentially by the fact that human behavior is mediated by language. Moreover, the language of human affairs is saturated with concepts and terms that have implicit political content.

Economics, like sociology, political science, and psychology, is a “discipline” that is disciplined by ideology. In particular, in its contemporary form economics is a powerful influence over national and international political policies, especially as applied to economic forces in society. Economics is in turn powerfully influenced by the most prevailing societal forces in the world today – the machinations of financial elites. Academic economics is dominated by the so-called “free market” theories for which Milton Friedman is most famous. From his intellectual throne at the University of Chicago, Friedman and his minions have dominated the economic framework of U.S. international as well as domestic policies for decades. Of course, there is little human freedom in the corporate-controlled “free markets.” Many of these policies have been at the heart of U.S. imperial strategies of foreign domination in the later twentieth century right up to today. U.S. geopolitical strategies have been driven largely by attempts to control world fossil-fuel markets.

Empire of Emissions

Anyone so naïve as to believe that U.S. foreign policy is meant to “bring democracy” to other nations must read Confessions of an Economic Hit man, by John Perkins (2004). As an “economic hit man,” it was Perkins’ job to persuade leaders of developing nations to accept huge loans to build massive infrastructure projects that did little to aid the development of those nations. Instead, they were designed and structured to bring poor countries with rich resources into submission to U.S. corporations and indebtedness to the U.S. government and the Big Banks. The deals required the money from the loans to be spent with U.S. construction companies on projects that would never generate enough income to pay off the loans. Pressure was then brought to bear on such nations to comply with U.S. political demands for resource exploitation and political subservience. Perkins’ book is a fascinating on-the-ground account of the workings of the expansive imperial structure, the larger picture that Naomi Klein characterizes as “disaster capitalism” in her book, The Shock Doctrine: The Rise of Disaster Capitalism (2007).

Despite the exposure of the massive economic and social failings of the growth-at-any-cost form of predatory extractive capitalism that is ideologically propped up by the neoliberal economic theorists, not much has changed in “modern economics.” This is also true of the specialty of “environmental economics.” The latest effort to stand firm supporting “market mechanisms” as the means to solve all problems in the world, is made by William Nordhaus. His essay in the New York Review of Books, October 8, 2015, tries to destroy the economic credibility of Pope Francis’ recent encyclical, Laudato Si’: On Care for Our Common Home (Vatican Press, 2015. Available at w2.vatican.va).

Nordhaus is Sterling Professor of Economics at Yale University and a well established environmental economist. His attack on Pope Francis’ encyclical pretends to be grounded in supposed rock-solid economic facts of “effective” market approaches to restraining carbon emissions. He entirely ignores the strong evidence that carbon trading in Europe has been a dismal failure. Rather than having a basis in scientific findings, his analysis is actually grounded only in neoliberal economic ideology. It ignores both the severity of the economic and ecological facts of our destabilizing world and the moral questions raised by Pope Francis’ argument.

At least ecological economists examine economic systems as operating within the living earth systems that sustain all life, including economists and other humans. Norhaus’ failure – and that of economics in general – is that he treats earth systems as mere economic factors to be incorporated in the economists’ models of market forces. In fact, economies are human systems operating within and now seriously disrupting the earth systems upon which they rely. This is a direct result of the propagandistic role of economics in the political culture of the U.S. and most of the other industrially overdeveloped nations.

Immoral Economics

Nordhaus wants to protect the failed economic system by tweaking its damaging impacts. However, living earth systems are being so severely destabilized by the fundamental ways that system operates, that only a massive reorganization of human economic life will be sufficient to allow those systems to re-stabilize.

Nordhaus concludes his essay by chiding the pope for not endorsing a “market-based solution” such as carbon pricing (and the disaster that is carbon trading) as “the only practical policy tool we have” to turn back the dangerous trends of climate change. Certainly, such “solutions” would constitute the limit of action if we had to accept the corporate free market ideology. But Pope Francis has other ideas. He asserts the social immorality of a system that destroys climate stability and all that depend on it while creating more plutocracy and poverty. Pope Francis calls upon the people to turn away from compulsive consumerism. He calls upon world leaders to abandon the “magical conception of the market” and to turn away from the failed economic system they have allowed to rule us and severely damage the planet.

Nordhaus will have none of it. He dismisses economists like Anthony Atkinson, Thomas Piketty, and Joseph Stiglitz, who recognize in different ways the relationship between capital gone wild and increasing inequality. By attacking the idea that climate disruption causes poverty, Nordhaus attempts to deflect attention from the fact that unrestrained predatory global capital causes both. He optimistically asserts that utilizing assumed magical qualities of market mechanisms can somehow undo the damage that unbridled global capital markets have wrought. That is the trouble with economics.

Immigration, Refugees, Arms Sales, and the Food Crisis

The current stream of refugees to Europe from Syria, Iraq, Afghanistan and other conflict zones is just the tip of a growing iceberg. Most major news outlets focus on the struggle to resolve how the Europeans can absorb the current rush of migrants to Europe fleeing death and destruction. Distinctions are made between economic refugees and political or war refugees. Those deemed to be migrating to flee poverty and seek economic opportunity are more likely to be turned back. Those acknowledged to be fleeing political persecution are more likely to be welcomed. That is understandable, but much more is involved. News stories focus on the events of the moment and in this case are “Eurocentric.” Historians will later reflect on the role of such events in the larger flow over time. Meanwhile, there is more to come.

Some major newspapers, such as Great Britain’s The Guardian and The Independent, have begun to look also at the larger picture of which the current crisis is a mere symptom. There are several important connections between crises of war, poverty, climate disruption, and agricultural failures than commonly acknowledged, especially in the U.S. corporate media. Here and in Europe refugees are often seen as being of questionable character and possibly criminal intruders.

Blaming the Victims

We need not listen to Donald Trump to recognize the prejudice against Mexicans and all Central Americans, which permeates discussions of immigration in the news. Yet most refugees from Central America are fleeing violence in countries whose militaries were trained by the infamous U.S. military run “School of the Americas.” The results were clandestine but official death squads that tortured and murdered rebels and civilians alike. Their brutal actions are still taken in support of dictatorships in Central America that the U.S. has propped up for decades. And, of course, Mexican farmers, driven out of business by NAFTA enabled cheap corn dumping on the Mexican food market by U.S. corporations, have sought employment north of the border.

The refugees from Syria, Iraq, and Afghanistan, as well as smaller numbers from war torn regions in Africa are conceived by many Europeans as invaders. Other kind souls have held up welcome signs and handed out food to the immigrants, recognizing both their plight and their humanity. But the conflicts they flee have resulted largely from neocolonial attempts to exert geopolitical control over regions rich in oil, minerals, and materials needed for the failing endless economic growth of the Global North. The U.S. “war on terror” is inextricably entangled with its undead pretensions to Empire, cloaked in the phony ideological veneer of “bringing democracy” to the developing nations of the world. In a fundamental way, these immigrants are refugees from the consequences of empire.

Merchants of Death

Not much is said about the connections between the international arms trade and the current wave of immigration from the Middle East to Europe. It is common among humans to attribute the problems of other humans to assumed defects in those who suffer with the problems. This is no less true of the current situation and the geopolitical events leading up to the current surge of migration. In the U.S. it is commonly assumed that the problems of Sunni-Shiite violence stem from age-old animosities attributed to these groups. We ignore the fact that before the U.S. invaded Iraq, Sunnis and Shiites lived peacefully in the same neighborhoods and intermarried peacefully in Baghdad and elsewhere. In fact the U.S. demolish-divide-and-conquer approach to its occupation of Iraq forced Iraqis into conflict relations by destroying the civil society that sustained peaceful relations. That civil society existed under the prior dictatorship and certainly could have been sustained under a democratic regime the U.S. government claimed to be bringing to Iraq. But the U.S. destroyed civil society and most of the basic infrastructure upon which it depended.

The geopolitics of war is immensely influenced (and stimulated) by the international arms trade. In most conflict zones, little violence would be occurring were it not for the saturation of arms among conflicting groups supplied and sponsored by outside entities. The so-called “great powers” set up conflict situations by their attempts to control extant or potential “client nations.” The proliferation of arms results from loans or grants for sales by the dominant suppliers such as the U.S., China, Russia, and Germany, with significant sales from Eastern Europe as well. These nations facilitate sales by private arms dealers as well as making direct “loans” for purchases by client states and non-state actors. The U.S., for example, has contracted with various arms dealers to supply Afghan troops to fight the Taliban. Most of the arms used by ISIS are U.S. made, some confiscated from fleeing Iraqi troops and some purchased on the private arms market. The U.S. government does nothing to restrict sales by U.S. arms manufacturers and their dealers around the world – after all, that might upset the NRA.

Climate of Collapse

With the impact of global warming causing climate disruptions including regional drought and flooding in developing nations, food production is already being severely damaged. Some refugee camps in Lebanon, crowded with Syrians who fled their destroyed homes, have run out of food. The common idea that migrants are merely poor people seeking better economic opportunities is for these reasons both inaccurate and simplistic. Most poor rural Africans or Afghans –or middle class Syrians for that matter – would have had little or no motivation for leaving their homes for Europe or anywhere else if it were not for the threat of death by war and starvation.

It is the convergence of the externally stimulated armed conflicts – and imperious resource seizures – with growing disruption of regional agriculture and the destabilization of local political and economic structures that makes life in such places unbearable. Most of the destabilization in the world today is the result of “great powers” vying for power over nations rendered weaker by prior colonialism. The nations of the industrialized Global North compete to control the world’s resources. They destabilize weaker nations, as they charge headlong and indifferent, causing climate chaos and planetary destruction.

The Politics of Disinfotainment: Anything But Real Issues

The 1960s and 1970s were the peak years for a small magazine called “The Realist,” published and edited by Paul Krassner. It was filled with hilariously funny satire on the absurdities of American politics, economics, and culture. Along with Krassner, contributors included the likes of Lenny Bruce, Ken Kesey, Woody Allen, and Mort Sahl, among other respected writers. Cutting-edge comedy was merged with the most caustic of satirical social criticism. The one thing that stuck with me more than anything else Krassner wrote was his construction of the neologism, “disinfotainment.” That term always comes to mind, of course, when I think of contemporary politics. “Distract, misinform, and entertain the people, so we won’t have to talk about the real issues that matter to them and are a threat to us,” think the politicians who serve the plutocrats. Oh, so here we go again, now for the 2016 electoral season…

Candidates or Issues, Policy or Entertainment

If we are going to talk about actual ISSUES, we might have to deal with Bernie Sanders’ candidacy for the Democratic presidential nomination. Most of the issues Bernie raises are those he has fought for over the decades he has been in politics. To the dismay of the Corporate-Democrat politicians and the party’s national committee, Bernie’s issues poll exceptionally well with the majority of the American people. Break up the Big Banks. Make the corporations pay their fair share of taxes on their income, including on the revenue they hide overseas. Establish free university tuition in all state institutions. Expand social security instead of pretending it is in trouble and has to be reduced. Move from Obama Care to real universal health care. Vote down those international trade agreements that give up national sovereignty over labor, health, and environmental protections. Etc.

But the corporate media, being the disinformation ministry of the corporatocracy, does not want to directly deal with these issues. It is so easy to promote disinformation through entertainment – disinfotainment. So, they mock Bernie Sanders and characterize him as “out of the mainstream,” and as unable to win the nomination or the election, and therefore irrelevant. Never mind that Bernie’s issues pole so well with the majority of Americans. Instead, the media focus on Hillary, her Bengazi and email troubles – trumped up by the Republican Right as they are – and take seriously her vague and ambiguous “policy” statements that dance around the issues about which Bernie talks so directly.

But, of course, for the corporate media politics is supposed to be all about personalities and the “horse race” between “mainstream” (corporate approved) candidates. For the corporate mass media, something or someone is “politically impossible” if he/she/it reaches outside the corporate-approved idea box. For the network and cable news and Sunday talk shows, the focus is whether The Donald’s trash-talk is as trashy as his hair, whether the billionaire is an “outsider,” and who might be able to challenge his captivation of some disgruntled Americans. I almost gagged when I watched Chuck Todd pander to Trump on his private jet, as he asked Trump about his draconian Walled-America Hispanic-exodus racist immigration “policy.” If we want to know something about a candidate’s actual policy plans –what s/he might actually do – we may have to step back, put our thinking caps on and also demand answers to real policy questions. If the people make it clear enough that someone who really does talk about the critical issues of our time IS RELEVANT, how will that play out in the “mainstream” corporate media’s political coverage?

The Cult of Personality and the Avoidance of Issues

It’s time to get over the cult of personality in American politics. Look what happened with Obama’s perpetuation of Bush’s perpetual war. Sure, the racist congress kept the Black President from doing some moderately ‘liberal’ things, by denying his legitimacy in office and just saying no to everything. But Obama did perpetuate the neo-con model of world domination and the Wall Street model of plutocracy. FOLLOW THE MONEY!!! That’s where it is taking Hillary too.

No, Bernie is not our savior. But at least he has been consistently a fighter for the rights of citizens rather than the privileges of the corporations and their wealthy elites. Nor can he make the change we need, alone. If the Senate and House are not turned around, he probably could not get much more done in the public interest than Obama has, but at least he will have tried. Ultimately, it is not about any of these political “personalities,” it is about the issues that nobody but Bernie among the “candidates” of either party has consistently faced. It is indeed a ramshackle world we live in. Without breaking the corporate monopoly on politics in the form of the Repugnicrat two-part party monolith, change we can benefit from will not happen. But change we cannot live with will happen. That change will be climate chaos making economic and social chaos inevitable as it becomes impossible for large numbers of people around the world to survive where they now live, here as well as elsewhere. Mother Nature does not negotiate with special interests.

New Reality and Urgent Necessity

At minimum, Bernie is providing a great service. His candidacy embodies a wake-up call for the people to recognize that the “lesser evil” will neither get us a fair society or a livable planet. Politics as usual — and Hillary is just that as agent for her super-rich backers — has become the road to ruin. Special-interest politics will never lead to taking the steps necessary to avoid climate chaos and societal collapse. Even someone like Bernie Sanders being elected president would not assure climate security. Massive international cooperation of a kind hard to imagine in today’s political climate is necessary, but unlikely. The U.S. must be not only a key player in such a worldwide effort; it must be a primary contributor of technology and implementation resources for massive climate action.

Nobody can say for sure who “cannot” win the presidential nomination, though the pundits pretend to; Bernie Sanders can, and he might or might not. Grave and urgent planetary and national circumstances constitute a new reality not recognized by business-as-usual establishment politics. But if Bernie does win the nomination, the rockier road will be the Repugnicrats’ attempts to destroy him with the kinds of disinfotainment they are so good at. It is not about the personalities, it’s about survival. The American people are already beginning to recognize that fact well before the two wings of the political elite are willing to acknowledge it.