“Toxic textbooks helped cause the economic meltdown
The current economic meltdown is not the result of natural causes or human conspiracy, but because society at all levels became infected with false beliefs regarding the nature of economic reality. And the primary sources of this infection are the “neoclassical” or “mainstream” textbooks long used in introductory economics courses in universities throughout the world.
Every year these “mainstream” books serve to indoctrinate millions of students in a quaint ideology (perfect rationality of economic agents, market efficiency, the invisible hand, etc.) cunningly disguised as science. This mass miseducation deprives society of the moral and intellectual capacities it needs in order to design and maintain the support systems required by market economies.
We need new, non-toxic textbooks
More economic catastrophes will befall us and our children if we do not replace these toxic textbooks with non-toxic ones immediately. If decency and good sense prevail in academia, then affecting this reform will not be a problem. But textbook reform will damage many economic faculties and toxic textbook authors. The former will suffer losses to their reputations, the latter to their royalties, which in some cases run to millions of dollars.
Together, we can overcome these vested interests
Society can therefore expect well-placed and richly-funded strategic resistance to doing the right and necessary thing. This website and the associated Facebook group exist to help citizens, especially students, mobilize and organize themselves to overcome these vested interests.”
Edward has also established a website, also called Toxic Textbooks, as an adjunct to the Facebook group.
As I have argued numerous times on this blog, though there is no doubt that most neoclassical economists are well-meaning and fervently believe they make a positive contribution to society, their underlying model of the economy is delusional. Following a bad theory ultimately leads to catastrophe, and that is what we have today with the Global Financial Crisis.
Conventional economics not only completely failed to anticipate this calamity, but actively if unconsciously aided its growth by promoting deregulation of finance, by the development of financial derivatives, and via rescues of the financial system that simply encouraged its Ponzi behaviour to scale heights that poor old Charles Ponzi could only have dreamed of.
If economics were in any sense a science, this dramatic failure would lead to a period of soul searching and intellectual forment from which would emerge a more empirically grounded vision. But with the essentially unscientific nature of economics, this development is unlikely unless enormous pressure is brought to bear on academic economics departments by their students, by business groups, unions, and community groups–in short by anyone whose welfare is affected by the economy.
The most immediate source of pressure will be students of economics, who can and should actively protest against being taught neoclassical dogma as the global economy goes into meltdown around them.
As an undergraduate, I led such a revolt at the University of Sydney in 1973. We had marked success in that battle, but lost the war in that economics in general came to be dominated by the false vision of Milton Friedman, rather than by truly scientific, empirically grounded analysis. In a very direct way, the financial crisis is a direct consequence of Friedman’s intellectual victory in the 1970s. Now that we can see the consequences of that victory, it is essential to finally win the war to bring realism into economics.
The time has come for economics students to once again “be revolting”. Edward Fullbrook has established this group to provide a New Media focus for such student action. I have proudly joined, and I encourage all critical economics academics and students to do likewise.
Originally published at Steve Keen’s Debtwatch and reproduced here with the author’s permission.