Economics is in a mess. Verity Bastion, Emeritus Professor of Economics, speaks out.
The Mint has asked me to write a column. Now I know this Mint thing it’s a rallying cry for the so-called new economics lot, but their editor – a nice northern chap, possibly a tad lefty as people from up there often are – said they wanted “a credible voice from the established economics side.”
Well it’s quite nice to be recognised in my dotage for my modest, but I should add, not insignificant, contributions to the discipline of economics. I can knock out a few hundred words now and then to provide a light diversion from pulling together my hard won economic wisdom for future generations. My husband, Thomas, and I have recently moved to a rather swanky private retirement home in delightful grounds just outside Pangbourne.
The faciities are quite exceptional and wonderfully peaceful for writing without the bother of having to trawl through yet anther student’s essay on the internationalisation of economic growth 1870 to the present day. I’ve even managed to dust off my Badminton – some of the old backhand is showing a flicker of its former fabulous flourish (must use that in my column).
Yes the Ash Court is quite the epitome of what the free market can deliver.
Of course I would have preferred to have bagged a column in the Economist – so much more… well… right. And the new woman at the helm there, Zanny, seems a terrifically able girl.
Sadly I couldn’t quite fit in with their schedule. No. I went to meet Zanny in their delightful St James’ offices – they look like they haven’t changed since the sixties – so resassuring… like the patched pullover my tutor at the LSE used to wear. Sadly her PA must have double booked her – anyway she wasn’t available. But I definitely couldn’t have taken anything on – I overheard one of their editors saying they needed someone a “bit more now” but my diary at the time meant that was totally out of the question.
So yes The Mint wants a steadying hand on their tiller. Quite sensible.
I think I made the right impression on the The Mint editor when I told him from the off that the current difficulties are of course entirely the creation of self-serving politicians and corrupt bureaucrats, who wouldn’t recognise a proper free market if they were in Petticoat Lane.Our resident’s manager has organised a pruning class in the delightful gardens here at Ash. Thomas has trotted along leaving me to air my first thoughts for publication. And what a demonstration of the attention to detail this place is able to offer – all courtesy of sound, private sector efficiency. Thomas, bless him, has been a little critical of Ash Court recently. Ironically the excellent broadband here has enabled darling Tommy to avail himself of some unhinged nonsense written by those economic hooligans in Manchester that talks about the dangers of “financialisation” of the care home sector .
Thomas does try to get a handle on economics issues. And it’s endearing that he wants to be able to discuss ideas in economics. But he so often, as now, comes away with a partial grasp of thing. To be clear: I have not frittered my time reading the drivel he’s currently exercised by – and like now he goes sounding off these crackpot theories which leaves me having to set him straight. It would be so much easier were he to just ask me to explain before investing his effort.
Dear Thomas embodies the way things are going now with the partially informed hordes. It is quite breathtaking that Thomas is questioning Ash Court’s integrity when the place is an exquisite demonstration of the way free markets enable initiative to blossom and deliver what people want. Compromising standards. Not one bit.
Poor Thomas was particularly grumpy this morning, after he slipped in the shower. We are expecting the management team (I went to Cheltenham with the mother of the facilities senior manager, Arabella) to have a non-slip shower floor installed very soon. Tommy said it was a “death trap” which is a little over the top.
The fundamental problem with real economists is that they lack the backbone to speak out. I know we had a bad Brexit but forecasting is tricky. Economists wield the surgical knife of mathematics to cut to the truth. We know free markets and free trade have advanced the world for 200 years. Without free markets we would not have mobile phones in Africa. Thomas, the sweetie, likes to throw in his simplistic retort: “Aye cos who needs food and water?”
I think the rot started when so-called nudge theory became fashionable with slick politicians such as Blair and Cameron. It says you can bamboozle people into doing what you want with little effort, because they are not very clever. And it gave a fillip to the so-called heterodox economists. Heterodox? Loosely translates from the Greek of course as mixed up thinking. Quite. As the great John Kay says, who would ever go to a heterodox dentist to have their teeth out Was Sweeney Todd a heterodox hairdresser, I ask?
And there are too many naïve people chipping in these days on economics. Now I’m an admirer of the monarchy, not least its protection of property rights. But what was HRH thinking when she asked economists: “Why didn’t you see the Crash coming?”. She is clearly not an economist.
Then the turgid toadies at the Royal Society felt they had to “admit” that their models weren’t up to it and it had all been a big mistake due to “hubris“. I will never know why they didn’t point out that the heterodox crowd were just lucky with their prediction.
As Bernanke points out, the models weren’t designed for exceptional events but work very well in normal, stable times. It’s simply common sense that a system that works well most of the time is clearly the right one.
Now for coffee in the residents lounge. Sweetly, Tom said it reminded hime of the lobby in the Mandarin Oriental in Dudley. The management tell us there will be at least two coffee mornings per week until the remainder of the apartments in the development are sold. CRESC, 2016, Where does all the money go  John Kay, 2015, We can reform economics without creating new disciplines  British Academy, 2009, Letter to Her Majesty the Queen. London School of Economics  Bezemer, Dirk J, 2009, “No One Saw This Coming”: Understanding Financial Crisis Through Accounting Models”. Munich Personal RePEc Archive. Retrieved October 23, 2009  Ben Bernanke, 2010, Implications of the Financial Crisis for Economics