Three Blind Mice
This year’s Nobel Prize in Economics went to three economists who certainly made an impact, just not in the way we might hope. Each of them played a huge part in perpetrating multiple financial meltdowns, crippling the world’s economy and pushing humanity to the brink of collapse. They and their neoclassical colleagues are the architects and cheerleaders of our failing world system, and I’d be happy if angry Econ 101 students who know full well they have no future started disrupting classes, throwing pies and nailing manifestos to their professors’ doors.
Bernanke, Diamond and Dybvig won the Nobel for their work on how to better manage bank runs and financial crises. Just don’t ask them how to stop these meltdowns from happening in the first place. Here’s an idea: Why not hold off on giving them the Nobel until they figure that out?
Most economists are stuck in the wrong paradigm. They’re caught in a situation very similar to the astronomers of 500 years ago who, following Ptolemy’s geocentric model of the universe, were tearing their hair out trying to make their numbers work. They couldn’t figure out quite how the sun, moon and stars moved around above us in the night sky. It was only when Copernicus pointed out that we are not the center of the universe — the sun does not revolve around the Earth but rather the other way around — that all their convoluted calculations fell magically into place.
This kind of Copernican shift in perspective must happen in the science of economics today. Economists and lay people alike must wake up to the fact that our human money economy is a subset of the Earth’s larger bioeconomy and not the other way around.
This insight would change everything . . . it would invite us to see the world with new eyes . . . to value things differently . . . to rethink growth . . . to redefine progress and how it’s measured. Above all, it would open the door to a whole new mix of exciting policy alternatives for getting us out of the climate crisis that threatens to crash all life on planet Earth.
Give the damn Nobel to Herman Daly in 2023!