University of Vermont Penalizes Rethinking Economics

By Steve Keen, professor and Head of the School of Economics, History and Politics at Kingston University in London
Cross-posted from his Patreon page.

Mainstream economics clearly failed humanity in 2007, when, as the world sat on the brink of the biggest economic crisis since the Great Depression, mainstream economic models were predicting that 2008 was going to be a great year.My favourite such prediction was the OECD’s bi-annual Economic Outlook, which proclaimed in June of 2007 that “the current economic situation is in many ways better than what we have experienced in years“.

EDITORIAL

ACHIEVING FURTHER REBALANCING

In its Economic Outlook last Augutm, the OECD took the view that the US slowdown was not heralding a period of worldwide economic weakness, unlike, for instance, in 2001. Rather, a “smooth” rebalancing was to be expected, with Europe taking over the baton from the United States in driving OECD growth.

Recent developments have broadly confirmed this diagnosis. Indeed, the current economic situation is in many ways better than what we have experienced in years. Against that background, we have stuck to the rebalancing scenario. Our central forecast remains indeed quite benign: a soft landing in the United States, a strong and sustained recovery in Europe, a solid trajectory in Japan and buoyant activity in China and India. In line with recent trends, sustained growth in OECD economies would be underpinned by strong job creation and falling unemployment.

That was two months before the crisis began.

You might think that, after such an extreme failure, economists would be trying to find what went wrong with their modelling. That has happened at policy institutions like the Bank of England and, to its credit, the OECD.

The Bank of England established the “One Bank” research unit after the crash, has employed many researchers from outside economics, and is, in my personal experience, very receptive to non-mainstream ideas now. The OECD established a new unit called New Approaches to Economic Challenges, and is also much more receptive to non-mainstream views than it was before the crisis.

But universities have been a very different proposition.

In university departments, the reaction of the mainstream has been to defend their paradigm, and to penalize those who criticize it. Whereas in the past they would tolerate the odd dissident as just “that guy down the corridor with those weird views” and let him/her teach a range of service subjects, now they are actively targeting such non-conformists for removal.

A recent instance of this was the decision of the University of Vermont to sack a popular lecturer, John Summa, for teaching mainstream economics in a critical manner. The case has all the nasty characteristics of an academic bunfight, of which I’ve experienced several myself. Do read John’s GoFundMe appeal, even if you don’t wish to make a donation.

In the end, he was dismissed, and he is now challenging that dismissal via a court action. I wish John the best, hope that justice will prevail, and I’ve made a small donation ($100) to his cause. I’d be pleased if you did too. He needs $4000, and he’s about 60% of the way there.

I’ve reproduced some of John’s evidence below, but there’s much more on his GoFundMe site.

John Summa’s Statement

Despite solid evidence of exaggerated and false claims used against me to persuade the Dean to deny my reappointment at UVM, these mischaracterizations were ignored by the Vermont Labor Relations Board when they ruled on my grievance. The case is now being appealed to the VT Supreme Court.

But I need help! Click here to learn more:

I allege that proven false and exaggerated claims masked disapproval of my ecological critiques of standard (supply and demand) neoclassical model economics (which I fully and fairly taught according to over 2,500 student evaluations). I maintain that there is no evidence whatsoever to support the Chair’s biggest claim that I was not teaching the standard (neoclassical) model “fully and fairly”.

Make a donation and help me fight academic bullies who don’t want ecological and alternative economics being taught to students. 

I argue that the Chair was leading the removal of a popular and maverick veteran teacher who was exposing students (after teaching models fully and fairly and getting good reviews from students) to the truth about the profound failures of core curriculum models students are required to learn (and do learn). Among other shortcomings I highlighted is the failure of these models to address global warming, growing inequality and systemic market failure.

Purging popular and challenging teachers cannot be tolerated. Help me fight against academic cronyism and intellectual nepotism at UVM. Make a pledge!

Despite some Nobel prize winning economists saying these models are “foolish” and “dead-end” approaches in today’s world  (information I shared with students), I was nevertheless removed based on the belief that I was not teaching “good” economics (Chair’s choice of words) —  a reference to the same models now discredited by some of the profession’s own leading practitioners. Apparently  the Dept. Chair is unaware that there is no consensus on what constitutes “good” economics. Your good economics is my bad economics and vice versa.

The Faculty Standards Committee (FSC) at the University of Vermont was not fooled by the actions of the Chair and voted unanimously to reappoint me and described the review process as “tainted” (and believed the Chair was “out to get” me, according to a whistleblower who came forward to inform me of this fact).

If you would like to help me, please make a donation at my gofundme page. Here is the link

Thanks for helping me stand up to the enemies of freedom of expression and alternative thinking about economics.

D&S Left Forum panels, plus: Friedman Responds on Single-Payer

Dollars & Sense will be at this year’s Left Forum conference in New York City, this afternoon through Sunday afternoon. Come visit D&S co-editor at the book exhibit table!  We are also sponsoring two panels:

Bernie v. The Greens: What Can the Government Actually Do to Fix Our Economic Mess?, with Gerald Friedman, Jill Stein, and Sean Sweeny, moderated by Abby Scher.  Sun noon to 2pm, Room L2.85.

Finance Capital and Fraud: Evidence and Discussion of Rigging & Predatory Behavior, with Jason Hecht, John Summa, and Haim Bodek, moderated by John Sarich. Sun noon to 2pm, Room 1.105.

Besides appearing on one of our panels at Left Forum, Jerry Friedman has worked up a response to the Urban Institute’s study on the costs of Sanders’ single-payer plan, The Sanders Single-Payer Health Care Plan: The Effect on National Health Expenditures and Federal and Private Spending, which led to all kinds of breathless reporting at the usual anti-Sanders outlets like Vox (Bernie’s plan costs twice as much as he says it would!) and WashPo (“Sorry, Bernie fans!” His plan will cost $18 trillion!), claiming that it had been shown that (FAIR/Extra!’s great analyst Adam Johnson pointed out that WashPo managed to wring out four anti-Sanders stories from this one study in the space of seven hours.)  The spectacle of Democratic Party think-tanks like the Urban Institute and the Tax Policy Center taking on the role of dampening people’s social democratic expectations is something to behold.

Anyhow, here is the beginning of Jerry’s take-down of the Urban Institute study:

The Urban Institute’s evaluation of the Sanders single-payer plan is based on dubious assumptions, questionable estimates, and some opaque arithmetic. By assuming unprecedented increases in utilization and discounting the program’s likely savings, the Urban Institute’s study produces extreme estimates about the cost of the Sanders program. The study then magnifies the impact of these costs on the Federal budget by also assuming the complete disappearance of state and local health spending, not only on Medicaid but on all other public health programs funded on the state and local level. Next, the study appears to ignore over a trillion dollars in savings that it does concede to the Sanders program, dropping these from its bottom line.

Read the rest of Jerry’s rebuttal here.

Hope to see some D&S blog readers and magazine subscribers at Left Forum this weekend!