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On Oct 13, 2020, at 4:33 PM, Miriam Vieni <miriamvieni@xxxxxxxxxxxxx> wrote:
It's all a big lie. There is no "Nobel Prize" in Economics.
The fake Nobel economics prize was part of a ploy to de-democratize control
over economic decisions.
Yasha Levine
Oct 13
Another year, another round of Nobel Prizes, and yet another opportunity to
remind people that — unlike the other Nobel Prizes — there is no actual
Nobel Prize in Economics. There never has been.
The fake Nobel prize in economics was part of a propaganda ploy hatched in
the 1960s by Sweden’s activist central bank to imbue neoclassical (aka
neoliberal) economic theories with mainstream credibility and respect. The
plan was to give what was in essence a radical political ideology the sheen
of a real, hard science — in line with the Nobel prizes in chemistry and
physics and biology.
That history is reflected in this year’s winners — two obscure economists
working in a very narrow field: a subset of game theory that deals with
optimizing auctions. Wow! Wait, auctions? Huh?
We’re surrounded by oligarchy, austerity, corporate power over every aspect
of our lives, environmental destruction on a global scale. And we’re talking
designing slightly more efficient auctions? I don’t know about you, but it
seems like some seriously narrow-minded accountant-type work given our dire
apocalyptic times.
Branko Milanovic @BrankoMilan
The point I want to make is this: Economics is a social science. Its aim is
to make us understand the world and make people’s lives (materially) richer.
The work that should be singled out is the work that does that—in a big way.
October 13th 2020
114 Retweets578 Likes
I’m not the only one who thinks so. Economist Branko Milanovic explicitly
criticized the award for highlighting fringe free-market tweekers, while
passing over economists who are actually tackling important political
questions and trying to make sense of our world and our time — things like
China’s recent transformation and growth, or the political failure of
Russia’s privatization, or the possible ties between slavery and capitalism,
or the effect of monopolies on society. Instead, while the world burns, the
prize was awarded to two narrowly focused technocrats whose only
contribution to society has been to make markets more efficient.
I agree with Branko. But the problem is that the fake Nobel prize in
economics has always had a political objective — and a very particular
institutional history.
The prize was designed to take economics out of the realm of politics and
thrust it into the realm of hard sciences. The point was to make people
think economics ran on immutable and natural laws — kinda like physics. The
larger agenda was to unshackle society from post-WWII Keynesianism.
Specifically: to weaken democratic and state control over economic
decisions.
People forget that economics has historically been a synonym for politics
and ideology — in fact, one of the early founders of the profession
explicitly called economics “political arithmetic,” a term that describes
what’s going on better than anything we use today.
Yasha Levine @yashalevine
Gonna go with my British imperialist boy William Petty and call “Economics”
by its original 17th century title: “Political Arithmetick.”
January 13th 2019
3 Retweets19 Likes
So the fake Nobel economics prize was part of a larger political movement
among American and European corporate elites to depoliticize — that is, to
de-democratize — control over economic decisions. The point was to take it
out of the public realm and place it back into the hands of private
interests. So it’s not surprising that this history continues to exert
influence on the prize today. In that sense, the prize is part of the
problem. By normalizing neoliberal economic ideology, it helped cause the
very apocalypse we’re facing in our age of late industrial capitalism.
I wrote about this prize’s forgotten history years ago. Searching around for
the article, I found it had all but been erased from the Internet. It’s
almost impossible to find using Google. So I’m reprinting it below.
—Yasha Levine
PS: I just found out that a book came out on this very same topic — four or
five years after I published my article. It’s called The Nobel Factor: The
Prize in Economics, Social Democracy, and the Market Turn. I haven’t read it
yet, but it looks great.
As Branko described it in his review:
Avner Offer and Gabriel Söderberg (“The Nobel factor: the prize in
economics, social democracy and the market turn”) look at the strange death
of social democracy at the hands of market liberalism. That death was
accelerated by the role of the Nobel prize in economics that conferred to
economics an allure of science and that was used to much greater profit by
neoliberal economists to push for their version of economic policies.
________________________________________
The Nobel Prize in Economics? There is no Nobel Prize in Economics
Yasha Levine • October 2012
It’s Nobel Prize season again. News reports are coming out each day sharing
the name of the illustrious winner of the various categories — Science,
Literature, etc. But there’s one of the prizes that’s a little different.
Well, that’s putting it lightly… you see, the Nobel Prize in Economics is
not a real Nobel. It wasn’t created by Alfred Nobel. It’s not even called a
“Nobel Prize,” no matter what the press reports say.
The five real Nobel Prizes—physics, chemistry, literature, peace, and
medicine/physiology—were set up in the will left by the dynamite magnate
when he died in 1895. The economics prize is a bit different. It was created
by Sweden’s Central Bank in 1969, nearly 75 years later. The award’s real
name is the “Sveriges Riksbank Prize in Economic Sciences in Memory of
Alfred Nobel.” It was not established by Nobel, but supposedly in memory of
Nobel. It’s a ruse and a PR trick, and I mean that literally. And it was
done completely against the wishes of the Nobel family.
Sweden’s Central Bank quietly snuck it in with all the other Nobel Prizes to
give retrograde free-market economics credibility and the appearance of
scientific rigor. One of the Federal Reserve banks explained it succinctly,
“Few realize, especially outside of economists, that the prize in economics
is not an “official” Nobel. . . . The award for economics came almost 70
years later—bootstrapped to the Nobel in 1968 as a bit of a marketing ploy
to celebrate the Bank of Sweden’s 300th anniversary.” Yes, you read that
right: “a marketing ploy.”
Here’s a Nobel family member describing it: “The Economics Prize has nestled
itself in and is awarded as if it were a Nobel Prize. But it’s a PR coup by
economists to improve their reputation,” Nobel’s great great nephew Peter
Nobel told AFP in 2005, adding that “It’s most often awarded to stock market
speculators. . . . There is nothing to indicate that [Alfred Nobel] would
have wanted such a prize.”
Members of the Nobel family are among the harshest, most persistent critics
of the economics prize, and members of the family have repeatedly called for
the prize to be abolished or renamed. In 2001, on the 100th anniversary of
the Nobel Prizes, four family members published a letter in the Swedish
paper Svenska Dagbladet, arguing that the economics prize degrades and
cheapens the real Nobel Prizes. They aren’t the only ones.
Scientists never had much respect for the new economic Nobel prize. In fact
a scientist who headed Nixon’s Science Advisory Committee in 1969 was
shocked to learn that economists were even allowed on stage to accept their
award with the real Nobel laureates. He was incredulous: “You mean they sat
on the platform with you?”
That hatred continues to simmer below the surface, and periodically breaks
through and makes itself known. Most recently, in 2004, three prominent
Swedish scientists and members of the Nobel committee published an open
letter in a Swedish newspaper savaging the fraudulent “scientific”
credentials of the Swedish Central Bank Prize in Economics. “The economics
prize diminishes the value of the other Nobel prizes. If the prize is to be
kept, it must be broadened in scope and be disassociated with Nobel,” they
wrote in the letter, arguing that achievements of most of the economists who
win the prize are so abstract and disconnected from the real world as to be
utterly meaningless.
The question is: Why would a prize that draws so much hatred and negativity
from the scientific community be added to the Nobel roster so late in the
game? And why economics?
To answer that question we have to go back to Sweden in the 1960s.
Around the time the prize was created, Sweden’s banking and business
interests were busy trying to ram through various free-market economic
reforms. Their big objective at the time was to loosen political oversight
and control over the country’s central bank.
According to Philip Mirowski, a professor at the University of Notre Dame
who specializes in the history economics, the “Bank of Sweden was trying to
become more independent of democratic accountability in the late 60s, and
there was a big political dispute in Sweden as to whether the bank could
have effective political independence. In order to support that position,
the bank needed to claim that it had a kind of scientific credibility that
was not grounded in political support.”
Promoters of central bank independence made their arguments in the language
of neoclassical market efficiency. The problem was that few people in Sweden
took their neoclassical babble very seriously, and saw their plan for
central bank independence for what it was: an attempt to transfer control
over economic matters from a democratically elected government and place
into the hands of big business interests, giving them a free hand in running
Sweden’s economy without pesky interference from labor unions, voters and
elected officials.
And that’s where the Swedish Central Bank Prize in Economic Sciences came
in.
The details of how the deal went down are still very murky. What is known is
that in 1969 Sweden’s central bank used the pretense of its 300th
anniversary to push through an independent prize in “economic science” in
memory of Alfred Nobel, and closely link it with the original Nobel Prize
awards. The name was a bit longer, the medals looked a little different and
the award money did not come from Nobel, but in every other way it was hard
to tell the two apart. To ensure the prize would be awarded to the right
economists, the bank managed to install a rightwing Swedish economist named
Assar Lindbeck, who had ties to University of Chicago, to oversee the awards
committee and keep him there for more than three decades. (Lindbeck’s famous
free-market one-liner is: “In many cases, rent control appears to be the
most efficient technique presently known to destroy a city — except for
bombing.”)
For the first few years, the Swedish Central Bank Prize in Economics went to
fairly mainstream and maybe even semi-respectable economists. But after
establishing the award as credible and serious, the prizes took a hard turn
to the right.
Over the next decade, the prize was awarded to the most fanatical supporters
of theories that concentrated wealth to the top .0001%.
In 1974, five years after the prize was first created, it was awarded to
Friedrich von Hayek, the leading laissez-fair economist of the 20th century
and the godfather of neoclassical economics. Milton Friedman, who was at the
University of Chicago with Hayek, was not far behind…
This is a preview of a full letter that is only available to subscribers. To
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________________________________________
© 2020 Yasha Levine Unsubscribe
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