A Good Weekend

This weekend a group of postdocs and grad students got together for a spontaneous celebration.

Yes, the economy is in the tank, job prospects for even us academics are looking worse, but over the past week we've all felt a sense of relief. To quote a cliché that has never felt more true, the nightmare is over. Perhaps now we could once again cherish what makes America so special for all of us. So there we were, Americans, Canadians, Germans, Portuguese, Chinese, and Japanese having a great time. We toasted to Obama and kissed an anti-American administration goodbye. You might be wondering, who are you guys to call Bush, his cronies and the greed-industrial complex anti-American?

To us basic scientists, America represents a land that is built on innovation, a country that despite its puritanical roots has led the way towards modernization throughout the twentieth century. America is a land with first class academic institutions sponsored by the government. Americans have always trusted professionals to give them expert advice. That's why the most trusted people in the US are doctors, scientists, engineers and others who have dedicated their lives to gaining knowledge. It is true that over the last 28 years, a group of cynical self-serving selfish and ideological individuals have tried to rip apart the structure of the US government in an attempt to enrich themselves and serve the interests of profit mongers. As they've raped the US treasury, they have attacked those who deal with ideas, theories and models. We, the academic class, have been sounding the alarm for a while. We've been warning our fellow citizens that although the uber-free-market ideology makes sense on the surface, like any simplistic ideology it was out of touch with reality. We cringed at Alan Greenspan's comment that something was wrong with reality - no! Reality simply is. It's your conception of how reality works, the model in your head, that is usually wrong. By experience we know that reality is tough to understand. Maybe that's why some are calling for a re-evaluation of the only professionals that did support the current administration, the Chicago school of economic thought. We just hope that all the ideologues have learned this lesson.

But at least for now we can hope that things will change.

UPDATE: Maybe things will change indeed. Just watch the second part of the interview where David Brooks admits that the conservative agenda is bankrupt:

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You are making the common error of conflating Chicago-style libertarianism with Bush's failed neocon agenda

Friedman, the Cato Institute, Reason et. al. was against the Iraq war, against the drug war, against ethanol subsidies, against corporate welfare for the defence and prison industries etc. They have also rejected the social programs of the religious right.

There is not even a debate in economic circles on the basic tenets of free markets, & no credible politician on the left dares to propose 60s & 70s style socialist policies.
I would say that Chicago's victory was complete, to the point where the political divide is drawn on other issues. So we have the great liberal hope essentially proposing a return to the fiscal & economic policies of the 1990s but sweetening the offer with lower corporate income tax rates.

bwv

bwv

What world to you inhabit?

You see in the world I live in, the current meltdown was caused by
1 sub prime mortgages
2 credit swaps
3 buying on the margin.

All of these were caused by a failure to regulate, and that is directly a result of the Chicago 's victory as you would say.

Credit bubbles are unfortunately a staple of economic history, they occur in unregulated markets as well as regulated ones. The Japanese economy in the 1980s was heavily regulated. The IMF calculated over 40 systemic banking crises around the world since 1970. The banking and housing sectors are the most heavily regulated segments of the US economy. The derivates and structured credit was mostly a way around regulatory capital requirements.

Where were the regulators calling for actions that would have prevented this crisis? To have taken what in hindsight would have been the right actions - namely tightening underwriting requirements for houses - would have meant people thrown out of work in the housing industry and low income people denied credit to buy houses, neither of which would be a politically palatable outcome

Obama's victory is inspiring.

But like you said, reality is, and reality awaits. Scientific enterprise is funded by government. Given the current trajectory of public finance worldwide, I think a big 'Change' is inevitable. The current American academic model is hinged upon Post-World War II economic order, predicated upon high growth and expansion. Is it sustainable if the economic landscape that has been so kind to it are completely transformed? I don't doubt that the Obama administration will do their best to support science. But he will be constrained by reality and priorities.

By bystander (not verified) on 11 Nov 2008 #permalink

bystander,

I completely agree. The edifice of academic science is based on an unsustainable increase in funding from the government (at about 9% per year according to a recent study quoted in Science). The next NIH director must face the realities that science funding can't increase at that rate, especially in these financially tough times. What does this mean for postdoc career paths and the pyramid scheme that drives academic research? We're unsure.

Yet despite all this, we are hopeful that effective changes can be made. Sometimes a crisis provides the impetus to make radical changes.