Saturday, October 17, 2009

Ideologically Loaded Rhetoric of Mainstream Economics

A half-century ago, John Kenneth Galbraith had a marvelous description of the shaping of language regarding crises.

Galbraith, John Kenneth. 1958. The Affluent Society (Boston: Houghton Mifflin, 1998).
38: Marx's reference to the "capitalist crisis" gave the word an ominous sound. The word panic, which was a partial synonym a half century ago, was no more reassuring. As a result, the word depression was gradually brought into use. This had a softer tone; it implied a yielding of the fabric of business activity and not a crashing fall. During the great depression, the word depression acquired from the event described an even more unsatisfactory connotation. Therefore, the word recession was substituted to connote an unfearsome fall in business activity. But this term eventually acquired a foreboding quality and a recession in 1953-1954 was widely characterized as a rolling readjustment. By the time of the Nixon administration, the innovative phrase "growth recession" was brought into use.

I am presently reading Reinhart and Rogoff's new book.

Reinhart, Carmen M. and Kenneth S. Rogoff. 2009. This Time Is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press).

The book is an encyclopedic study of crises through the lens of monetarism and public finance. The authors also casually bandy about the expression, "financial repression," for any policy that inconveniences the financial system.

I wonder what the academic economics community would think of a book that routinely described economic policies in terms of labor repression. I suspect that no matter what the quality of the book might be such language would automatically convict the author of unacceptable bias.

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