With an ego bigger than the national deficit and a reputation for brash, unorthodox thought, Lawrence Summers could have been a prophet. He could have championed the Tobin tax and convinced G20 leaders to finally put it in place. He could have sounded the alarm on ecological overshoot and the critical need for new measures of progress. He could have been the catalyst for global market reform, steering us toward a true-cost system in which the price of every product tells the unflinching ecological truth. He could have joined a litany of revolutionary economists — like Hayek, Galbraith, Keynes and Daly — who jolted the discipline into fresh new modes of thought. Yet Lawrence Summers remains firmly grounded in the neoclassical tradition, shirking the mantle of economic wunderkind and fiercely protecting the staid status quo.
As secretary of the US Treasury during the Clinton administration, Summers formed an alliance with Alan Greenspan and Robert Rubin, fighting tooth and nail to repeal the Glass-Steagall Act: legislation that had kept deposit banking separate from investment banking since the Great Crash of 1929. Summers and Greenspan joined forces again to mercilessly quash any initiative to regulate derivatives. The duo championed the 2000 Commodity Futures Modernization Act, which transformed the derivatives markets into history's largest casino. Together, Summers and Greenspan lit the fuse on the economic disaster we are still living through.
Why would Obama choose Summers — whose old-guard philosophy makes a mockery of Hope and Change — to lead his economic team? And why — at a time when climate change threatens to become the biggest market failure the world has ever known — does Obama not have a single ecological economist (like Herman Daly or Mathis Wackernagel) on his panel of advisers?
Same people, same policies, same models — not exactly the kind of change we were hoping for.
Deep in a recession and with scary ecological scenarios looming, now may be the ripest moment we’ll ever have to power-shift global capitalism onto a new path. Adbusters #85 asks economics students around the world to join the fight to revamp Econ 101 curriculums and challenge the endemic myopia of their tenured neoclassical profs. Go to KICKITOVER.ORG, read a few texts, download the Kick it Over Manifesto (and other posters) and whack them up in the corridors of your campus. Make sure your university is at the forefront of the paradigm shift from neoclassical to ecological economics now underway. If you’re an economics student, email [email protected] to receive a half price copy of Adbusters #85.