The limits of rationalism

Adam Curtis uses his post The Economists’ New Clothes to take economists to task for their complacent claims to scientific certainty. Along the way, he argues that exponents of the so-called free markets were effectively really supporting state control in a new form.

…When you examine the roots of the neoliberal idea of the market it gets odder still. The ideas that rose up in the post-war years that captured the imagination of people like Mrs Thatcher are actually a very strange mutation of capitalism. If you listen to interviews with Friedrich Hayek he talks far more like a cold war systems engineer discussing information signals and feedback than Adam Smith with his theories of Moral Sentiment… While the roots of the technical systems that the banks created to manage risk also lie back in the cybernetic dreams of the 1950s and 60s. Dreams not of progress through the dynamism of markets – but of using computers to create a balanced, almost frozen world.

He also includes a film he made in his Pandora’s Box TV series in 1992. This is fascinating viewing and conveys the extraordinary complacency and pseudo-rationalism of economists during the 60s and 70s. With – for me – reminders of the class system embedded in the accents of some of them.

Hat tip: David Smith’s delicious links.

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