“It’s the economics stupid”

Yesterday Michael Jacobs and Mariana Mazzucato on the LSE’s Economics & Society Blog wrote The Brexit-Trump Syndrome: it’s the economics, stupid

“… The dominant economic consensus has been, rather, that financial markets are efficient, corporations will best innovate and invest when left to themselves, rising inequality is the price to be paid for growth, and the best role for government is to get smaller.

The great financial crash and the profound failure of the austerity policies which followed it should already have blown this orthodox economic consensus away. …”

Having institutions like the LSE publish articles which draw these links between the orthodox economics and the seemingly destructive nature of political engagement should make us all pause for thought.

When we start to ignore the real effect that our tools and models for public policy creation are having on society at large, we should not be surprised when the public seems to know better then the so called experts.

… They should also think much more creatively about how to socialise not only the risks but the rewards of investments they have supported. In areas like drug pricing, patent laws and the financing of innovation, the state has been far too willing to take the costs while allowing the private sector to reap the benefits. …

From the above article we also need a political and social engagement with the policy decisions affecting everyday life, currently the CETA trade deal is being read in the EU Parliament, and the Canadian legal commentator Michael Geist also yesterday:

First, the lack of study on the financial impact of a key element of the CETA highlights a crucial flaw in the government’s rosy assessments of the deal. While the government has been claiming that CETA will deliver major gains for Canadians, its own officials have not even studied some of the financial costs associated with the same agreement.

Are we not to be worried with a base level of economic analysis being missed on trade deals with will have intercontinental impact, maybe as well as the economics it’s the lack of economics, stupid.