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Blame the Economists?

25 6 2
01.11.2018

BERKELEY – Now that we are witnessing what looks like the historic decline of the West, it is worth asking what role economists might have played in the disasters of the past decade.

Oct 29, 2018 Elizabeth Drew thinks that anything could happen in the upcoming congressional elections.

Oct 29, 2018 Dominique Moisi thinks the Saudi crown prince and the Trump clan are the biggest losers in the Jamal Khashoggi affair.

Oct 25, 2018 Michael Spence foresees significant long-term consequences, affecting the very structure of the global economy.

From the end of World War II until 2007, Western political leaders at least acted as if they were interested in achieving full employment, price stability, an acceptably fair distribution of income and wealth, and an open international order in which all countries would benefit from trade and finance. True, these goals were always in tension, such that we sometimes put growth incentives before income equality, and openness before the interests of specific workers or industries. Nevertheless, the general thrust of policymaking was toward all four objectives.

Then came 2008, when everything changed. The goal of full employment dropped off Western leaders’ radar, even though there was neither a threat of inflation nor additional benefits to be gained from increased openness. Likewise, the goal of creating an international order that serves everyone was summarily abandoned. Both objectives were sacrificed in the interest of restoring the fortunes of the super-rich, perhaps with a distant hope that the wealth would........

© Project Syndicate