PRESIDENT MICHAEL D Higgins has told students at the University of Chicago that the teaching of economics is going through “an intellectual winter” because it doesn’t take account of the social impacts of policy.
Higgins was delivering the King Abdullah II Annual Leadership Lecture in the university where influential economist Milton Friedman taught for over 30 years.
In his speech, Higgins said that political writing has returned to the beginning of the 20th century when “technocratic rationality had succeeded Reason as the central concept”.
Ireland, like the United States, is emerging from a crisis that has interlocking banking, fiscal, social and political strands, but also moral and intellectual dimensions that run deeper than most official framings of this crisis suggest.
“The recent economic and financial upheavals have thrown a glaring light on the shortcomings of the intellectual tools provided by mainstream economics and its key assumption regarding the sustainability of self-regulating markets (and, more particularly, of largely unregulated global financial markets),” he told the assembly.
In his speech, the President explained that the Irish constitution dictated that he “does not address issues falling within the Government’s remit” but that “as Head of State, I am compelled to represent the experience and hardships of the Irish people – all of them, at home and abroad”.
“The crisis has exacted a huge toll on the Irish people whose ordeals I, as President, am anxious to represent, ” he said.
President Higgins said that he chose to address these issues in his speech because of the influence the Chicago School of Economics has had on the teaching of economics internationally.
I turn to these issues here and now, in Chicago, because there is much to be drawn from the distinguished traditions of thought nurtured by the city of Chicago, from the rich, complex, even paradoxical, intellectual legacy of its university, which gave us both the Chicago School of Sociology, the writings of Robert Park and Louis Wirth, and the Chicago School of Economics, with Milton Friedman as its figurehead – Professor Friedman who famously said, with alarming candour, that “there is one and only one social responsibility of business: to increase its profits.
Ethics
President Higgins said that earlier this year he launched The President of Ireland’s Ethics Initiative which aims to stimulate discussions across all sectors of Irish society on the challenges of living together ethically.
He said that he wanted to propose a “critical examination of some of the core assumptions that underpin economics as it is currently taught in university departments across the world”.
The President says that he wants more broad debate about “what constitutes ‘prosperity’ and the good life” and points to a “harmful separation of the discipline of economics from its ethical and philosophical sources”.
President Higgins told the audience that as a teacher in the 1960s he was an avid read of the Chicago urban sociologists who wrote about deprivation in the city and did not foresee the influence economists in the 1980s would have on public policy.
The King Abdullah lectures is an annual series that brings word leaders to the University of Chicago to discuss world affairs.
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