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“the single most relevant book for our times”

Here is a comment on Asad Zaman’s Fundamental Flaws of Conventional Economics that deserves its own post.


January 29, 2016 at 5:52 pm

Yes, let me wade in but not too deeply. I was intrigued by your very first itemization about logical positivism having failed as a theory of knowledge, and especially your mention of it excluding morality. Since I am reading the late Joe Bageant’s “Deer Hunting with Jesus,” his book about the alienation of white working class Americans from upper middle class liberals, and them not voting the logical positivistic formulations of their own economic self interest, please note that this segment of America is where the morality contained in the Evangelical Movement/Fundamentalism has its deepest roots. They listen to Larry Summers tone, condescension (even as Larry has moved left, which he tries to hide by using terms like “secular stagnation) and run into the arms of Donald Trump, not Hillary Clinton…and who knows about Bernie Sanders.

The irony though, is that the nature of religious morality in America has shifted to worship the market as the final moral authority in determining social standing…has become entrepreneurial itself…so I don’t want to draw too many neat distinctions. Pope Francis, a moderate if not conservative social democrat has shockingly reminded us in the US that you can come up with an entirely different political economy after listening to exactly the same “Sermon on the Mount.”

Unfortunately the Right has been far more effective in translating the alienating scientific/mathematical posturing of economics into a more palatable ideological meal than the left, starting with Milton Friedman who had better sound bites than his debating partner, John Kenneth Galbraith. His son Jamie is trying, but his very interesting works (esp. The Predator State, The End of Normal) are hardly on the lips of the bottom 60-80%.

The same goes for the other great economic book from 1944, Karl Polanyi’s “The Great Transformation,” which I still can’t help but defend as the single most relevant book for our times, where he gives full weight to the overwhelming disruptions the rise of industrialism gave to the surplus agricultural workers as they were meted out shock treatment transformation into an urban proletariat with no social safety net. Logical positivists demand that we revise that history because wages rose after 1850, and they are probably right, they did rise later, but the memory of the transition and the scalding impression it left gave rise to a “never again” attitude, very similar to that which Putin has built upon the bitterness and brutality of the shock treatment fiasco that Russia underwent post 1989, advised by the best and brightest from the West. Does it even make a shallow impression upon the department minds at Princeton, Harvard, MIT, Stanford and U of Chi? Does history have any greater, ironical, cruelties yet to deliver. Probably it does.

It is out of experiences like these that ordinary human beings are driven from the cold winds that seem to blow perpetually from “scientific economics.”

I’ll leave it at that.

Summary of the Great Transformation by Polanyi

The Methodology of Polanyi’s Great Transformation


  1. Dave Raithel
    January 31, 2016 at 2:15 pm

    “Two facts must be clearly recognized if a proper evaluation of the Vienna Circle is to be attempted. The first is, that, despite its relatively short existence, even some of the most central theses of the Vienna Circle underwent radical changes. The second is that its members were by no means of one mind in all important matters; occasionally they espoused perspectives so radically at variance with each other that even their ostensive agreements cannot remain wholly unquestioned. ” And etc.


  2. Dave Raithel
    January 31, 2016 at 2:36 pm

    But alas: “That some of the members of the Circle went, without logical blunders, still further by arguing that socio-political considerations can play a legitimate role in some instances of theory choice due to underdetermination is yet another matter. Here this particular issue (see references at the end of section 2.1 above), as well as the general topic of the Circle’s embedding in modernism and the discourse of modernity (see Putnam 1981b for a reductionist, Galison 1990 for a foundationalist, Uebel 1996 for a constructivist reading of their modernism), will not be pursued further.”

  3. graccibros
    January 31, 2016 at 4:59 pm

    Mr. Raithel:

    Quite right that the members of the Vienna circle – which arose between the two great wars of the 20th century in good part in response to the irrationalism and degradation of language by the Right in Austria and Germany, ( and its tragic culmination) – were dissenters of various stripes, some quite left. However, I will argue that their methodology left as much as an impact as their own personal lives and political choices, and drove philosophy into ever more esoteric realms, divorced perhaps forever from religion, politics and economics, at least within the confines of academe…but I don’t think it was confined to just there. If Lord Skidelsky is not quite trying to put philosophy back into the teaching of economics, in response to the rise of the quants (and he give their methodology its due deference), he clearly calls for a requirement to master economic history to help balance perspectives. A step in the right direction, in my view.

    I’m drawing upon the excellent discussion of these matters from the Chapter 10 (Universal Philosophy and Antihumanist Theory) from Mark Greif’s 2015 book “The Age of the Crisis of Man, Thought and Fiction in America, 1933-1973.” I found it most fascinating, and relevant for my work, that the reviewer in the NY Review of Books puzzled at Greif’s making much of the reaction to the rise of totalitarianism, communism and fascism, and the Cold War, but glossing over the Great Crash and resulting global Great Depression…the economic roots of fascism…if not the events of 1917-1921 and the consolidation of communism in Russia. The reviewer was Christopher Bentley, June 25, 2015 print edition.

    This glossing over, done by the writers who were worried about what “mankind” had become, personified in concentration camps, Stalin and Hitler…it seems to me is partly self-protective of how much power the West had delegated to economists and their policy advising role, and how deeply integrated the world today now has become to the elaborate chains connection of globalization. A new Great Crash now, given the troubles in responding to the dress rehearsal of 2008-2009, which we have not mastered yet…should give everyone pause.

    I’m more worried than most about the cumulative signs I’m reading in global economic matters…

  4. blocke
    February 1, 2016 at 8:53 am

    Ignorance is not bliss. In 1969, I shared a dinner table with A J Ayer on the SS Bremen, travelling from Southhampton to New York. On one occasion in our conversation I asked the great man, who was on his way to deliver the James lectures at Harvard, about philosophy in Germany, since I was returning from a stay in the country. He answered that there was no philosophy taught in Germany, which somewhat surprised me. I asked him about Habermas, who is 1969 was being discussed almost everywhere among my German friends.
    Ayer answered, “who

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