The triumphant neoliberalism
On
November 9, 1989 a historic event of great importance did happen in the world:
the fall of the Berlin Wall. That same year Francis Fukuyama published his
famous article “The End of History” in which he argues that “we are witnessing
the end of history as such: that is, the end point of mankind's ideological
evolution and the universalization of Western liberal democracy as the final
form of government” (15). Thus, neoliberalism trumps all other alternatives
civilizational and consecrated itself as the final form of political-economic
organization of the “New World Order”.
In
this context of globalization, the economic theory becomes a mere instrumental
knowledge (technocracy) thinking itself essentially as a “tool-box”,
constituted by models and theories to be conveniently used by economist to fix
up the “mismatches” of economical machinery. No longer examines content issues
of economics. Only the functional relationships are considered important. In
other words, it does not matter to know what is X and what is Y but only how
they relate functionally to manipulate variables “instrument” and thus achieve
the desired results with the “target variables”. Hence the preponderance has
Econometrics in the analysis and current economic policy.
This
new approach of the economics as a knowledge essentially instrumental has clear
epistemological implications because not
given importance to the explanatory power of theories -which necessarily lead
us to the plane of Political Economy- but only to their predictive power.
Therefore, it is not strange that a liberal economist as Milton Friedman hold
that it is not necessary to consider the realism of the assumptions or the
explanatory power of a theory when examining its scientific validity but only
its “predictive power” because “positive economics is or may be an objective
science in the same sense as any of the physical sciences”. (16)
The
“depoliticization” of
the Economics
After all this historical
analysis of the evolution of economic theory and epistemology in the context of
different social and political events, is that we can see clearly that the
economists never could get separate science from ideology. The process of “depoliticization”
of the economy was clearly an ideological process that sought to eliminate the
explicit political element of economic analysis to replace it with an implicit
(camouflaged) form of policy based on utilitarian individualism, the doctrine of
minimum State and the liberalism bourgeois.
So it is not surprising that
economists now called “neoclassical” decided to change the name of economic
science from “Political Economy” to simply “Economy”, so that the separation
between economics and politics, between market and State, is final. Thus, the
Economy become a “pure” science. But that claim is clearly an ideological
choice that, as Immanuel Wallerstein explains, “has to do with the dominant
ideology during the nineteenth century. Basically, the dominant view of
liberalism worldwide was that the State, market and society were three distinct
entities. They operated with different logical and therefore should be studied
separately, and in a sense, stood apart in the real world. So the scholars had
to segregate their knowledge of such aspects. Overall this was what happened,
and what was already established in 1945 as an organizing principle for the
social sciences at leading universities”. (17)
However,
as it explains Oscar Lange “the ideological element in scientific research is
not necessarily an obstacle in obtaining results with objective validity” to
the point that “the ideological motive can also stimulate the development of
science” (18). Therefore, to make an objective judgment about the legitimacy
(or illegitimacy) of neoclassical economists's attempt to eliminate the
political factor of the Economy will be examined, to speak in terms of
epistemology lakatiana, if from this are built scientific research programs
“progressives” or “regressives”. (19)
To
answer this question it will be necessary to understand the nature of the
relationship between economics and politics and then examine the
epistemological and practical implications that flow from this.
In
general terms we can define economics as the discipline that studies the
management of resources to meet human needs and politics as the art of
government. However, since resources are limited, there will always be needs
that will remain unmet and this will lead to individuals to make decisions
about how to distribute and use these resources. This has to do necessarily
with the political structure of society in terms of the organization,
distribution and institutionalization of the power of the different agents
interacting in it, which obviously leads to the plane of politics and,
therefore, can be said of consistently that the economy is intrinsically linked
to the political and, consequently, that economic theory -if it want to be
realistic- must become inescapably in Political Economy.
The epistemological
implications of the above line of reasoning are extremely important because it
follows that the only coherent and consistent way to study economic phenomena
is through of a multidisciplinary analysis because in reality there are no
“economic”, “sociological” or “political” problems but only “social problems”
and they all have an irreducible complexity, it being understood it as that
none of the aspects (political, psychological, ethical, economic, etc.) that
compose it can be analyzed in isolation with respect to the other because each
one of them have always and necessarily a constant and intrinsic relationship
with the others.
The traditional way that
neoclassical economists have to get rid of these difficulties has been and
still is say that they work only with so-called “economic factors”. But taking
into account the above we can say that it is absolutely wrong because it is not
logically possible to isolate a part of reality denominating it simply as “economic”
when in fact exist as such only insofar as it are interrelated with the legal
and the political structure (institutional) of society. Moreover, the appeal to
the isolation of the “economic factors” as a criterion of demarcation does not
solve anything because it is like a pettitio principi falacy. And is that the
single definition of “economic factors” involves scrutiny of all the factors
involved, including the “non-economic”, which is only done once defined a
priori the concepts used.
With respect to the practical
implications of recovering the political approach in Economic theory we have to
say they are as or more important than epistemological. As the prestigious
epistemologist argentine Mario Bunge says, any study of Economics as if an
autonomous and isolated is doomed. Clear example of this is the unfortunate
experience they have had and still have several Third World countries with
economic planners who ignore the non-economic components of society and the
system of values and norms inherent therein. Most development plans designed
for these countries are due to economists who have ignored the circumstances
and the cultural and political values of those societies, deliberately
sacrificing their cultural and political aspirations in order to reach one goal
all costs: industrialization, stabilization of the currency or some other
purpose of economic policy. No wonder, then, that such plans have usually
lacked popular support and, in most cases, have not achieved their goals. A
successful development plan should be considered only as a component of a much
broader, inclusive and comprehensive social plan.
In conclusion,
it is absolutely necessary to recover the political dimension of economics to
deal explicitly with greater accuracy, breadth and depth the problems we face. In
this sense, the pretension of neoclassical economists to construct an economic
theory "chemically pure" is nothing more than an counterproductive
ideological attempt which conceals the political nature of the economy in order
to avoid the uncomfortable political consequences (for certain group) that
could result from economic analysis.
Therefore, the kind of
economist who need the world of the future and that should be taught in our
universities should be like that Keynes's describing, in his biography of
Marshall, when wrote that “has to reach far in different directions and must
combine powers natural which is not always found together in the same
individual. He must be in some degree mathematician, historian, statesman and
philosopher. He must understand symbols and speak with ordinary words. He must
contemplate the particular in terms of the general and the abstract and
concrete touching on the same flight of thought. He must study the present in
the light of the past and facing the future. No part of man's nature or his
institutions must be completely out of his consideration. He must be
simultaneously intentional and selfless as idealistic and as incorruptible as
an artist, yet sometimes as near the earth as a politician”. (20)
References
15. Francis Fukuyama, “The End
of History”, The National Interest, No. 16, Summer 1989, p. 4.
16. Milton Friedman, Essays in
Positive Economics, Chicago University Press, Chicago, 1953, p.10.
17. Immanuel Wallerstein,
"Open the Social Sciences", lecture delivered on 24 October 1995 for
the Social Science Research Council in New York.
18. Oscar Lange, “Field and
Method of Economics” (1945-1946), in: Economic Quarter, No. 58, Fondo de
Cultura Economica, Mexico.
19. See: Imre Lakatos, The
methodology of scientific research programs, Alianza, Madrid, 1989, p.9.
20. John M. Keynes, “Essays on
Biography”, in: The Collected Writings of
John Maynard Keynes, vol. X, Macmillan, London, 1972.
You can contact the author of this article in: “Dante Abelardo Urbina Padilla” (Facebook) and dante.urbina1@gmail.com (email)
