Heretics welcome! Economics needs a new Reformation | Larry Elliott

Neoclassical economics has become an unquestioned belief system and treats those challenging the creed as dangerous

In October 1517, an unknown Augustinian monk by the name of Martin Luther changed the world when he grabbed a hammer and nailed his 95 theses to the door of the Castle Church in Wittenberg. The Reformation started there.

The tale of how the 95 theses were posted is almost certainly false. Luther never mentioned the incident and the first account of it didnt surface until after his death. But it makes a better story than Luther writing a letter (which is what probably happened), and thats why the economist Steve Keen, dressed in a monks habit and wielding a blow up hammer, could be found outside the London School of Economics last week.

Keen and those supporting him (full disclosure: I was one of them) were making a simple point as he used Blu Tack to stick their 33 theses to one of the worlds leading universities: economics needs its own Reformation just as the Catholic church did 500 years ago. Like the medieval church, orthodox economics thinks it has all the answers. Complex mathematics is used to mystify economics, just as congregations in Luthers time were deliberately left in the dark by services conducted in Latin. Neoclassical economics has become an unquestioned belief system and treats anybody who challenges the creed of self-righting markets and rational consumers as dangerous heretics.

Keen was one of those heretics. He was one of the economists who knew there was big trouble brewing in the years leading up to the financial crisis of a decade ago but whose warnings were ignored. The reason Keen was proved right was that he paid no heed to the equilibrium models favoured by mainstream economics. He looked at what was actually happening rather than having a preconceived view of what ought to be happening.

Somewhat depressingly, nothing much has happened, even though it was a crisis neoclassical economics said could not happen. There was a brief dalliance with unorthodox remedies when things were really bleak in the winter of 2008-09, but by late 2009 and early 2010, there was a return to business as normal.

The intellectual monopoly is something of an irony given how central the idea of competition is to orthodox thinking, but it is a sad fact as the preamble to the 33 theses notes that the neoclassical perspective overwhelmingly dominates teaching, research, advice to policy, and public debate.

Many other perspectives that could provide valuable insights are marginalised and excluded. This is not about one theory being better than another, but the notion that scientific advance only moves ahead with a debate. Within economics, this debate has died.

That debate needs to be rekindled. A more pluralist approach would take account of the complexity of markets, the constraints imposed by nature and rising inequality. So what needs to be done?

Firstly, listen to consumers, because it is pretty obvious that they are unimpressed with what they are getting. The failure of the economics establishment to predict the crisis and its insistence that austerity is the right response to the events of a decade ago has meant the profession has rarely been less trusted.

Of course, there were economists who got it right and some of them Paul Krugman, for example wielded real influence. But it should have come as little surprise that when it came to the Brexit referendum, voters took the warnings from the UK Treasury, the Organisation for Economic Co-operation and Development, the International Monetary Fund and the Bank of England with a very large pinch of salt. After all, not one of these august bodies armed as they were with their general equilibrium models saw the deepest recession since the second world war coming, even when it was already under way.

It is welcome news that discontent is bubbling up from below on university campuses. True, the prestigious academic journals remain in the hands of the old order and in economics faculties there is strong resistance to change but increasingly students are showing their frustration at being told to learn and regurgitate economics that is not just narrow and of little relevance, but also plain wrong. Of the 33 theses pinned to the LSE, five involved the teaching of economics, with demands to be taught history and economic thought, and for the monopoly of the status quo to be broken.

One of the theses demands that economics must do more to encourage critical thinking, and not simply reward memorisation of theories and implementation of models. Students must be encouraged to compare, contrast, and combine theories, and critically apply them to in-depth studies of the real world. The fact that students feel the need to say this is a terrible indictment of the way economics is being taught, and their discontent negates the idea that this is just whingeing from aggrieved Keynesians.

Secondly, we should stop treating economics as a science because it is nothing of the sort. A proper science involves testing a hypothesis against the available evidence. If the evidence doesnt support the theory, a physicist or a biologist will discard the theory and try to come up one that does work empirically.

Economics doesnt work like that. Theories can be shown to work only by making a series of highly questionable assumptions such as that humans always behave predictably and rationally. When there is hard evidence that disputes the validity of the theory, there is no question of ditching the theory.

Thirdly, economics needs to be prepared to learn from other disciplines because when it does the results are worthwhile. One example is the way in which auto-enrolment has increased pension coverage. If humans were truly economically rational, it would make no difference whether their employers automatically enrolled them into pension schemes: they would decide whether to join schemes on the basis of whether they deemed it worth deferring consumption until they had retired. Yet, basic psychology says this is not the way people actually act. They are far less likely to opt out of something than they are to opt into something.

Fourthly, economics needs to be demystified. One of the big battles between Catholics and Protestants in mid-16th century England was over whether the bible should be in Latin or English, a recognition that language matters. The easy part of an economic Reformation is to attack the current establishment; the difficult part is to present a compelling story without resorting to jargon. Control of the narrative as George Osborne realised when he criticised Labour for failing to mend the roof while the sun was shining is crucial.

At the launch of the 33 theses last week, Victoria Chick, emeritus professor of economics at University College London, put it this way: The economics mainstream has the hallmarks of certain religions. They think they have the truth. But read for yourself and think for yourself. Change has occurred before and it can occur again. Shes right. It can.

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Read more: https://www.theguardian.com/business/2017/dec/17/heretics-welcome-economics-needs-a-new-reformation

‘Impossible’ New Zealand maths exam even flummoxes teachers

Complaints being investigated after geometric reasoning section of high school paper left brightest students despondent and in tears

A New Zealand maths exam for high school students has been criticised as impossible with even the brightest students left despondent and in tears at the difficulty of the questions.

New Zealand year 11 students sat the maths exams on Monday and the New Zealand Qualifications Authority has since received a number of complaints regarding the unreasonable difficulty of the paper.

It is the second year in a row NZQA has been criticised for a maths exam and education minister Chris Hipkins has ordered the authority to give him a full report on the matter.

We are trying to enable these kids to do well and you set an exam like this and they come out deflated, it is not giving them much hope for next year, or for maths in general, said Logan Park High School maths teacher Amanda Fraser, who is also president of the Otago Mathematics Association.

I think the exam was off, it was too difficult. I am concerned about the impact it has had on the self-esteem of students. We are are already fighting an uphill battle because there is a stigma around mathematics and this is definitely not helping break down the barriers students have.

Fraser said the geometric reasoning section of the exam was the main stumbling block for average and talented students alike, and she and other maths teachers struggled to work out some of the questions for a test designed for a 15-year-old child.

One student who studied for weeks in preparation for the exam said she was thrown by the difficulty of some of the questions, which tested skills she hadnt been taught.

Both my parents are scientists so I have always been interested in mathematics and always almost assumed Id go into it. It is an important subject for me, she said.

I struggled in the geometric reasoning section but I thought it was because I hadnt prepared enough. A friend of mine was quite shocked, she said They have never asked us to do this sort of maths in any of the practises weve done what happened here?

Deputy chief executive assessment Kristine Kilkelly of NZQA said she believed the test was in line with the national curriculum.

The Level 1 mathematics examination was set by a team of experienced mathematics teachers, for the right curriculum level, and is consistent with the specifications for the standard.

An open letter from teachers is being sent to NZQA and the ministry of education raising concerns about the exam.

Read more: https://www.theguardian.com/world/2017/nov/22/impossible-new-zealand-maths-exam-even-flummoxes-teachers

Romania shrugs off label of Europes poor man as economy booms

Since it joined the EU in 2007, government economic measures and communist-era educational excellence have spurred rapid growth

At a sleek new office in the heart of Bucharest, Fitbit co-founder and chief executive James Park explains why the smartwear giant is rapidly expanding its operations in Romania and following the lead of a host of multinationals. The tech talent here is amazing. Romania and other countries in central and eastern Europe have great existing talent, and also great universities, he says.

The US company, which bought Romanian smartwatch brand Vector Watches for a reported $15m (11.4m) late last year, and has tripled its staff in Romania since, has just opened its largest research and development centre outside the US, in the Romanian capital. Its not alone: in recent years, major global companies such as Siemens, Ford and Bosch have set up or expanded operations in Romania, boosting an economy thats already growing at speed.

While many see Romania as a country of migrants flocking abroad to find work, back home the economy is booming. The services sector is expanding at pace, along with exports and manufacturing. Meanwhile, private consumption from clothes to furniture and cars hit a nine-year high in 2016, and increased a further 8% in the first half of this year.

The economy grew 5.7% year-on-year in the second quarter of 2017, the fastest rate in the EU, where the average growth rate was 2.4%. This was on the back of a GDP rise of 4.8% in 2016 and 3.9% in 2015; during the same period the UK economy grew by a more placid 1.8% and 2.2%. According to the International Monetary Fund, Romanias economy is expected to grow by 5.5% for the whole of 2017.

The tech sector, in particular, is expanding fast, built on a communist-era legacy of excellence in science, mathematics and technical education, as well as Romanias strong language skills, which have long made it a hub for IT outsourcing. While the Romanian languages Latin roots have helped explained the countrys linguistic skills, some suggest it was a decision to subtitle rather than dub foreign programming on television that boosted foreign language exposure and proficiency.

According to industry insiders, the tech sector which employs about 150,000 people is expected to double its share of GDP to 12% by 2025, aided by one of the fastest broadband internet speeds in the world (behind only Singapore, Hong Kong, South Korea and Iceland).

Elsewhere, Ford has announced plans to hire almost 1,000 workers for its plant in Craiova, 180km west of the capital, adding to its current workforce of 2,715. The automotive giant has invested more than 1.2bn (1.1bn) in its Romanian manufacturing operations since 2008. Renault-owned Dacia, a former communist state-owned giant, remains the countrys largest company based on revenue, with a turnover of 4.1bn in 2016. Joining the EU in 2007 clearly had an impact, while more recent government measures have also boosted the economy.

The government in 2015 decided to cut taxation for consumption, says Ionut Dumitru, chief economist at Raiffeisen Bank Romania and chairman of Romanias fiscal council. They cut VAT from 24% to 20%, and now 19%, and extended the reduced VAT rate for food and some other items. This was a very strong stimulus for consumption.

The government has also doubled the minimum wage in four years. And its not only the minimum wage that has increased a lot, but also public sector wages.

Wages in Romania remain far below the EU average, making it an enticing option for outsourcing; the minimum monthly wage is currently around 283 only Bulgarias is lower within the EU.

However, lower wages have stopped many Romanians returning home, leaving companies short of workers in 2016, the unemployment rate dropped to an historic low of 5.9% compared with an EU average of 8.6%, amid predictions it will drop to 5.4% this year.

Uncertainty over Brexit is having an impact, with companies looking at alternatives within the EU in case the UK pursues an exit that restricts trade.

Were getting inquiries from UK companies on a weekly basis since the referendum, says Shajjad Rizvi, the director of the British Romanian Chamber of Commerce in the northern city of Cluj, one of the largest tech centres in central and eastern Europe.

We are seeing global companies hedging their bets, in case tariffs are not favourable or something else, and Romania is one of the choices they are looking at, he adds. Software companies, a lot are doubling or tripling their workforces in Romania, and a lot of those jobs are coming from the UK. Whole departments: marketing, PR, HR; they are being closed down in the UK and moved out here.

But there are also serious challenges. Romania has long been considered one of the most corrupt nations in the EU. Despite progress, there are still major concerns. In February, the country experienced the largest protests in decades after the government pushed through legislation that would have effectively decriminalised low-level corruption. The government backed down, but has yet to regain public trust.

Transportation infrastructure is also poor. Romania came 128 out of 138 countries for the quality of its road infrastructure in the latest World Economic Forum Global Competitiveness Report; the railway system, which is old and slow, came in slightly better at 79. There are only 747km of motorway in the whole country.

There is also concern about the rising deficit. In 2016 the government deficit the gap between state income and spending rose to 3% of GDP, up from 0.8% in 2015, due to increased spending and tax cuts. The main concern for the economy is the fiscal situation, says Raiffeisens Dumitru. The deficit is under pressure.

Even so, Romanias economy looks set to continue to expand in the near future. Its hard to sustain more than 5% growth, says Dumitru. Most analysts are predicting closer to 4% for next year. But even 4% will probably be one of the highest growth rates in Europe, so its not bad at all.

Read more: https://www.theguardian.com/world/2017/oct/14/romania-economy-booming

When bias beats logic: why the US can’t have a reasoned gun debate

Mass shootings in the US are consistently followed by calls for action and then political paralysis. Thats because people refuse to see nuance, experts say

In the week since the mass shooting in Las Vegas left nearly 60 people dead and hundreds injured, Americans have spoken out in outrage and grief, demanding action. They have asked, again: why cant the US pass any gun control laws?

At the same time, just as they did after Sandy Hook and San Bernardino and Orlando, these passionate advocates have endorsed some gun control laws with very little evidence behind them, even some policies that experts have labeled fundamentally not rational or a hysterical violation of civil rights. The great bipartisan gun control victory of this year may be new restrictions on bump stocks, a range toy used to make a semi-automatic rifle fire more like a fully automatic rifle, which arguably should never have been legal in the first place. That wont do much to reduce Americas more than 36,000 annual gun suicides, homicides, fatal accidents, and police killings.

Why does the US feel so paralysed every time it is confronted by a new attack?

Jon Stokes, a writer and software developer, said he is frustrated after each mass shooting by the sentiment among very smart people, who are used to detail and nuance and doing a lot of research, that this is cut and dried, this is black and white.

Stokes has lived on both sides of Americas gun culture war, growing up in rural Louisiana, where he got his first gun at age nine, and later studying at Harvard and the University of Chicago, where he adopted some of a big-city residents skepticism about guns. Hes written articles about the gun geek culture behind the popularity of the AR-15, why he owns a military-style rifle, and why gun owners are so skeptical of tech-enhanced smart guns.

He watches otherwise thoughtful friends suddenly embrace one gun control policy or another, as if it were a magic bullet.

Some kind of animal brain kicks in, and theyre like, No, this is morally simple.

Even to suggest that the debate is more complicated that learning something about guns, by taking a course on how to safely carry a concealed weapon, or learning how to fire a gun, might shift their perspective on whichever solution they have just heard about on TV just upsets them, and they basically say youre trying to obscure the issue.

I dont want to see that kid dead any more than you do, Stokes said. If there was a magic fix, I promise you I would support it.

In early 2013, a few months after the mass shooting at Sandy Hook elementary school, a Yale psychologist created an experiment to test how political bias affects our reasoning skills. Dan Kahan was attempting to understand why public debates over social problems remain deadlocked, even when good scientific evidence is available. He decided to test a question about gun control.

Kahan gave study participants all American adults a basic mathematics test, then asked them to solve a short but tricky problem about whether a medicinal skin cream was effective or ineffective. The problem was just hard enough that most people jumped to the wrong answer. People with stronger math skills, unsurprisingly, were more likely to get the answer right.

Then Kahan ran the same test again. This time, instead of evaluating skin cream trials, participants were asked to evaluate whether a law banning citizens from carrying concealed firearms in public made crime go up or down. The result: when liberals and conservatives were confronted with a set of results that contradicted their political assumptions, the smartest people were barely more likely to arrive at the correct answer than the people with no math skills at all. Political bias had erased the advantages of stronger reasoning skills.

The reason that measurable facts were sidelined in political debates was not that people have poor reasoning skills, Kahan concluded. Presented with a conflict between holding to their beliefs or finding the correct answer to a problem, people simply went with their tribe.

It wasa reasonable strategy on the individual level and a disastrous one for tackling social change, he concluded.

When it comes to guns, Americans want it both ways. A recent Pew study found that just over half of Americans want stronger gun laws. Even stronger majorities of Americans also believe that most people should be allowed to legally own most kinds of guns and allowed to carry them in most places.

There is room for thoughtful gun control within these constraints. But the extreme polarization of Americas gun debate the assumption, as the late-night television host Stephen Colbert argued when talking about the Las Vegas shooting, that the bar is so low right now that Congress can be heroes by doing literally anything obscures how symbolic and marginal some of the most nationally prominent gun control measures are. Like closing the terror gap, so that people on terror watchlists are not allowed to buy guns, or rolling back an Obama order on guns and mental illness that had been opposed by disability rights groups and civi liberties campaigners.

After the 1996 Port Arthur massacre, Australia imposed a mandatory buyback and melted down more than 600,000 semi-automatic rifles and other long guns, about a third of the countrys gun stock. They have not had a high-casualty mass shooting since.

American politicians and pundits are always asking: Australia tackled their mass shooting problem. Why cant we? But no one actually proposes an equivalent Big Melt in the United States, which would require a mandatory buyback of 90m American rifles, at a cost that might be in the billions of dollars.

Instead, an American assault weapons ban, which lasted from 1994 to 2004, allowed everyone to keep the military-style guns they already had, and defined assault weapons in such a technical way that gun companies were able to make cosmetic tweaks to certain models and produce virtually identical, but now legal, guns. A former Obama White House official told the Guardian candidly that the assault weapon ban does nothing and though Obama had nominally endorsed it in 2013, we would have pushed a lot harder if we had believed in it.

Part of the weakness of major gun control proposals is the result of the NRAs catch-22, said Adam Winkler, a gun politics expert at the University of California Los Angeles law school. The NRA waters down the gun laws and makes them ineffective and then says, Look, the gun laws are ineffective, we told you that gun laws never work.

But the biggest distortion in the gun control debate is the dramatic empathy gap between different kinds of victims. Its striking how puritanical the American imagination is, how narrow its range of sympathy. Mass shootings, in which the perpetrator kills complete strangers at random in a public place, prompt an outpouring of grief for the innocent lives lost. These shootings are undoubtedly horrifying, but they account for a tiny percentage of Americas overall gun deaths each year.

The roughly 60 gun suicides each day, the 19 black men and boys lost each day to homicide, do not inspire the same reaction, even though they represent the majority of gun violence victims. Yet there are meaningful measures which could save lives here targeted inventions by frontline workers in neighborhoods where the gun homicide rate is 400 times higher than other developed countries, awareness campaigns to help gun owners in rural states learn about how to identify suicide risk and intervene with friends in trouble.

When it comes to suicide, there is so much shame about that conversation and where there is shame there is also denial, said Mike McBride, a pastor who leads Live Free, a national campaign for gun violence prevention and criminal justice reform. When young men of color are killed, you have disdain and aggression, fueled by the type of white supremacist argument which equates blackness with criminality.

First-hand experience can be profoundly transformative the guitarist Caleb Keeter, who was caught up in the Las Vegas shooting, said afterwards: Ive been a proponent of the 2nd amendment my entire life. Until the event of last night. I cannot express how wrong I was. We need gun control. RIGHT. NOW.

But as Nicole Hockley, the mother of Dylan, one of the children killed at Sandy Hook, put it, many Americans seem exhausted and alienated by the gun debate itself, that cyclical conversation that moves from assault weapons to arming more Americans to mental illness to policy proposals that may or may not relate at all to what actually occurred.

Its time to open up the conversation, she argues to focus on different ways to save lives, rather than the same old gun law stalemate.

Otherwise, she wrote: By the end of next week this story will be almost gone as if it never happened, even while those most impacted are still reeling from shock and grief.

Read more: https://www.theguardian.com/us-news/2017/oct/07/us-gun-control-debate-bias

Edith Windsor and Thea Spyer: ‘A love affair that just kept on and on and on’

The 84-year-old widow behind the landmark supreme court decision on gay rights fought $363,000 estate tax and won

Edith Windsor and Thea Spyer were together for 40 years before they married in 2007. When Spyer died in 2009 Windsor, in the midst of her grief, was ordered to pay $363,000 in estate taxes as the federal government did not recognise the pair’s marriage.

Windsor appealed, and won. The supreme court agreed to hear her challenge to the Defense of Marriage Act, or Doma, in December, a decision Windsor told the Guardian had left her “delirious with joy“.

“I think Doma is wrong for all of the various ways in which it discriminates against same-sex married couples and against gays all together,” Windsor said. “It’s enormously satisfying and fulfilling and exciting to be where we are now.”

Spyer, she said, would have been proud of her achievement. “I think she’d be so proud and happy and just so pleased at how far we have come. It’s a culmination of an engagement that happened between us in 1967 when we didn’t dream that we’d be able to marry.”

Windsor, now a snappily dressed 83-year-old who is rarely seen without a long string of pearls around her neck, seems to have easily slotted into her position as the public face of marriage equality. But it is a role which must have seemed hard to imagine when in her early 20s, the then Edith Schlain married Saul Windsor, a friend of her brother’s. The two separated in 1952 after less than a year.

“I told him the truth,” Windsor recalled in an interview with NPR this year. “I said: ‘Honey, you deserve a lot more. You deserve somebody who thinks you’re the best because you are. And I need something else.'”

Windsor was born in Philadelphia in 1929, in the midst of the Depression. Her parents lost their home and business not long after her birth. In interviews she has recalled identifying with the leading men in the movies she went to watch while growing up, not the woman he was attempting to woo. Despite those feelings, she said she had no awareness of what life as a lesbian could be like.

“I could not imagine a life that way,” she told Buzzfeed. “I wanted to be like everybody else. You marry a man who supports you it never occurred to me I’d have to earn a living, and nor did I study to earn a living.”

Edith
‘Something like three weeks before Thea died she said: “Jesus we’re still in love, aren’t we”?’ Photograph: Richard Drew/AP

The divorce meant Windsor now had to do just that. She retained her name from the marriage but changed her life by moving to New York and concentrating on her career. Windsor worked as a secretary while studying at New York University. When she graduated with a master’s degree in mathematics she took a job at IBM.

Windsor said she would feel envious when she saw other women out together, but still found it hard to be openly gay in pre-Stonewall New York City. Finally, however, she decided she had had enough.

“About 1962, I suddenly couldn’t take it any more,” she recalled in Edie & Thea: A very long engagement, a 2009 film made about her and Spyer’s life and wedding.

“And I called an old friend of mine, a very good friend and I said if you know where the lesbians go please take me. Somebody brought Thea over and introduced her and we just started dancing.”

That was in Portofino, a restaurant in Greenwich Village. The pair kept dancing until, as Windsor tells it, she got a hole in her stocking. They would go to parties, dancing all the while, for two years until they started dating. Spyer proposed in 1967, with a brooch rather than a ring Windsor did not want to face questions from co-workers about the assumed husband-to-be.

“It was a love affair that just kept on and on and on,” Windsor said. “It really was. Something like three weeks before Thea died she said: ‘Jesus we’re still in love, aren’t we’.”

The couple moved into an apartment near Washington Square in Manhattan, where Windsor still lives, and bought a house together in Southampton, Long Island. Windsor rose to the highest technical position within IBM, and Spyer saw patients in their apartment. In the years following the Stonewall riots they both marched and demonstrated for equal rights.

In 1977, aged 45, Spyer was diagnosed with multiple sclerosis. They could still dance, Windsor told Buzzfeed, with Spyer ditching her crutches at the dance floor and leading with her good leg.

As Spyer’s health deteriorated, Windsor eventually became her full-time care giver. Getting ready for bed could take an hour, preparing to leave the house in the morning three or four, she said in an interview with the NYU alumni magazine.

In 2007, Spyer’s doctors told her she had one year left to live.

“Having gotten the bad prognosis she woke up the next morning and said: ‘Do you still want to get married?’,” Windsor said. “And I said ‘Yes’. And she said: ‘So do I’.”

The pair flew to Canada that year with six friends and were married in Toronto. Windsor wore white, Thea was in all black. The ceremony was officiated by Canada’s first openly gay judge, justice Harvey Brownstone.

“Many people ask me why get married,” Windsor said in remarks on the steps of the supreme court in March, the day the court heard arguments in her case against Doma.

“I was 77, Thea was 75, and maybe we were older than that at that point, but the fact is that everybody treated it as different. It turns out marriage is different.

“I’ve asked a number of long-range couples, gay couples who they’ve got married, I’ve asked them: ‘Was it different the next morning and the answer is always: ‘Yes’.’ It’s a huge difference.”

Less than two years after they were married, Spyer died. A month after that, Windsor had a heart attack.

“In the midst of my grief I realised that the federal government was treating us as strangers, and it meant paying a humongous estate tax. And it meant selling a lot of stuff to do it and it wasn’t easy. I live on a fixed income and it wasn’t easy,” she said.

Two lower courts had already ruled that it was unconstitutional for Windsor to have to pay the $363,000 in federal estate taxes. Attorneys representing Windsor argued in the supreme court that Doma violates the constitution in not recognising her marriage to Spyer.

When the Guardian spoke to Windsor back in December, the day the the court agreed to hear her case, the joy in her voice was clear. She felt optimistic, too.

“I really believe in the supreme court. First of all, I’m the youngest in my family and justice matters a lot the littlest one gets pushed around a lot. And I trust the supreme court, I trust the constitution so I feel a certain confidence that we’ll win.”

It turns out she was right.

Read more: https://www.theguardian.com/world/2013/jun/26/edith-windsor-thea-spyer-doma

Much ado about nothing: ancient Indian text contains earliest zero symbol

Exclusive: one of the greatest conceptual breakthroughs in mathematics has been traced to the Bakhshali manuscript, dating from the 3rd or 4th century

Nowt, nada, zilch: there is nothing new about nothingness. But the moment that the absence of stuff became zero, a number in its own right, is regarded as one of the greatest breakthroughs in the history of mathematics.

Now scientists have traced the origins of this conceptual leap to an ancient Indian text, known as the Bakhshali manuscript a text which has been housed in the UK since 1902.

Radiocarbon dating reveals the fragmentary text, which is inscribed on 70 pieces of birch bark and contains hundreds of zeroes, dates to as early as the 3rd or 4th century about 500 years older than scholars previously believed. This makes it the worlds oldest recorded origin of the zero symbol that we use today.

The
The front page (recto) of folio 16 which dates to 224-383 AD. Photograph: Courtesy of Bodleian Libraries/ University of Oxford

Marcus du Sautoy, professor of mathematics at the University of Oxford, said: Today we take it for granted that the concept of zero is used across the globe and our whole digital world is based on nothing or something. But there was a moment when there wasnt this number.

The Bakhshali manuscript was found in 1881, buried in a field in a village called Bakhshali, near Peshawar, in what is now a region of Pakistan. It was discovered by a local farmer and later acquired by the Bodleian Library in Oxford.

Translations of the text, which is written in a form of Sanskrit, suggest it was a form of training manual for merchants trading across the Silk Road, and it includes practical arithmetic exercises and something approaching algebra. Theres a lot of If someone buys this and sells this how much have they got left? said Du Sautoy.

In the fragile document, zero does not yet feature as a number in its own right, but as a placeholder in a number system, just as the 0 in 101 indicates no tens. It features a problem to which the answer is zero, but here the answer is left blank.

Several ancient cultures independently came up with similar placeholder symbols. The Babylonians used a double wedge for nothing as part of cuneiform symbols dating back 5,000 years, while the Mayans used a shell to denote absence in their complex calendar system.

However the dot symbol in the Bakhshali script is the one that ultimately evolved into the hollow-centred version of the symbol that we use today. It also sowed the seed for zero as a number, which is first described in a text called Brahmasphutasiddhanta, written by the Indian astronomer and mathematician Brahmagupta in 628AD.

This becomes the birth of the concept of zero in its own right and this is a total revolution that happens out of India, said Du Sautoy.

The development of zero as a mathematical concept may have been inspired by the regions long philosophical tradition of contemplating the void and may explain why the concept took so long to catch on in Europe, which lacked the same cultural reference points.

This is coming out of a culture that is quite happy to conceive of the void, to conceive of the infinite, said Du Sautoy. That is exciting to recognise, that culture is important in making big mathematical breakthroughs.

Despite developing sophisticated maths and geometry, the ancient Greeks had no symbol for zero, for instance, showing that while the concept zero may now feel familiar, it is not an obvious one.

The Europeans, even when it was introduced to them, were like Why would we need a number for nothing? said Du Sautoy. Its a very abstract leap.

Read more: https://www.theguardian.com/science/2017/sep/14/much-ado-about-nothing-ancient-indian-text-contains-earliest-zero-symbol

Eat, pray, live: the Lagos megachurches building their very own cities

Redemption Camp has 5,000 houses, roads, rubbish collection, police, supermarkets, banks, a fun fair, a post office even a 25 megawatt power plant. In Nigeria, the line between church and city is rapidly vanishing

Ha-lleluuuu-jah, booms the distinctive voice of Pastor Enoch Adeboye, also known as the general overseer.

The sound comes out through thousands of loudspeakers planted in every corner of Redemption Camp. Market shoppers pause their haggling, and worshippers some of whom have been sleeping on mats in this giant auditorium for days stop brushing their teeth to join in the reply.

Hallelujah is the theme for this years Holy Ghost convention at one of Nigerias biggest megachurches, and all week the word echoes among the millions of people attending.

As evening falls on Friday, Adeboye, a church celebrity, is soon to take the stage at his vast new auditorium to give the conventions last, three-hour sermon. Helicopters land next to the 3 sq km edifice, delivering Nigerias rich and powerful to what promises to be the night of the year.

Thousands of worshippers surge up the hill towards the gleaming warehouse. Shiny SUVs, shabby Toyota Corollas and packed yellow buses choke the expressway all the way from Lagos, 30 miles away.

The
The congregation prays during the Redeem Christian Church of Gods annual Holy Ghost convention

But not everyone has to brave the traffic. Many of those making their way to the auditorium now live just around the corner. The Redeemed Christian Church of Gods international headquarters in Ogun state has been transformed from a mere megachurch to an entire neighbourhood, with departments anticipating its members every practical as well as spiritual need.

A 25-megawatt power plant with gas piped in from the Nigerian capital serves the 5,000 private homes on site, 500 of them built by the churchs construction company. New housing estates are springing up every few months where thick palm forests grew just a few years ago. Education is provided, from creche to university level. The Redemption Camp health centre has an emergency unit and a maternity ward.

On Holiness Avenue, a branch of Tantalisers fast food chain does a brisk trade. There is an on-site post office, a supermarket, a dozen banks, furniture makers and mechanics workshops. An aerodrome and a polytechnic are in the works.

And in case the children get bored, there is a funfair with a ferris wheel.

A
A funfair located inside the Redemption Camp

The camp is becoming a city

Set up 30 years ago as a base for the churchs annual mass meets, as well as their monthly gatherings, Redemption Camp has become a permanent home for many of its followers. The camp is becoming a city, says Olaitan Olubiyi, one of the churchs pastors in whose offices Dove TV, the church television channel, is permanently playing.

Throughout southern Nigeria, the landscape is permeated by Christianity of one kind or another. Billboards showing couples staring lovingly into each others eyes, which appear at first glance to be advertising clothes or condoms, turn out to be for a pentecostal church. Taxi drivers play knock-off CDs of their favourite pastors sermons on repeat, memorising salient lines.

Im a Winner, read the bumper stickers that adorn the fancier cars, declaring their owners allegiance to Winners Chapel, a grand white megachurch whose base, Canaanland in the Ota region, is all neat fences and manicured lawns.

Where Im from, people long for tractors to farm with. Here they just use them to cut grass, exclaims one visitor, driving through Heavens Gate. It is a world away from the throng of people, fumes and rubbish outside.

One
One of the Nigerian commercial banks operating in the camp

Canaanland has banks, businesses, a university and a petrol station one of a number of churches beginning to offer these services.

But none can match Redemption Camp for scale. Daddy GO as the charismatic Adeboye is affectionately known by his followers has been perfecting the package for the past decade.

If you wait for the government, it wont get done, says Olubiyi. So the camp relies on the government for very little it builds its own roads, collects its own rubbish, and organises its own sewerage systems. And being well out of Lagos, like the other megachurches camps, means that it has little to do with municipal authorities. Government officials can check that the church is complying with regulations, but they are expected to report to the camps relevant office. Sometimes, according to the head of the power plant, the government sends the technicians running its own stations to learn from them.

There is a police station on site, which occasionally deals with a death or the disappearance of a child, but the camps security is mostly provided by its small army of private guards in blue uniforms. They direct traffic, deal with crowd control, and stop children who havent paid for the wristband from going into Emmanuel Park home to the aforementioned ferris wheel.

Mechanics
Mechanics attend to a 25-megawatt gas turbine plant that powers the camp

Comfort Oluwatuyi is a foodtrader in the Redemption Camp market. She says she pays a very low rent for her little lock-up shop and can make up to 10,000 naira a day in profit much more when a convention is on. The market formed seven years ago, when women in the camp petitioned Mummy GO Adeboyes wife, Foluke to build it so they would not have to cross the eight-lane expressway every time they needed some tomatoes.

Oluwatuyis 10-year-old daughter, Emmanuelle, helps her pour palm oil into plastic bottles and stack potatoes in tin dishes. Emmanuelle and all her siblings were born here. Its quite possible for a child to be born in this camp, grow up and be educated here, and then live here, Pastor Olubiyi says.

Outside the Holy Ghost convention, Redemption Camp has the peaceful surroundings and conveniences of a retirement village in large part because the power plant, fed by its own gas pipeline from Lagos, removes the need for the constant thrum of diesel generators.

My generator is on vacation. In the morning, I can hear the birds sing, says Kayode Olaitan, a retired engineer who moved his family here from Lekki, one of Lagos most upmarket areas, two weeks ago. He loads his pink-frocked granddaughter into the car, ready to drive to the all-night service.

Olaitans neat 78,000 bungalow has been built on what used to be a swamp. Workmen are scraping up concrete from the paving slabs, putting the finishing touches to the 75 identikit houses on Haggai Estate Nine.

Comfort
Comfort Oluwatuyi selling palm oil in a grocery shop in the camp market

Haggai, the churchs property developer, is named after the prophet who commanded Jews to build the second temple of Jerusalem. Almost all the houses on Nine have been sold, and Haggai is about to move on to Estate Ten. There is no perimeter wall around Redemption Camp, so it can expand indefinitely.

Mortgages are arranged through Haggai bank, headquartered in Lagos. There has been a knock-on effect on surrounding areas: in some cases, the price of land near Redeemed Camp has increased tenfold over the past decade.

For years, people have owned houses here to stay over after conventions and the monthly services. But increasingly, families like the Oliatans find themselves wanting to live full-time with people who share their values, in a place run by people they feel they can trust. We feel were living in Gods presence all the time. A few days ago, Daddy GO took a prayer walk around here, Oliatan says.

While you have to be a Christian and a church member to buy and live on site, there is no such requirement for doing business. The FCMB bank is one such business that has set up shop here, with bright white mock-Corinthian columns installed just behind the auditorium.

Cars
A line of traffic leading to the Redeemed Christian Church of God auditorium

Outside, a young woman in elaborate sunglasses and a polo shirt with MILLIONAIRE emblazoned on the chest has persuaded Tayo Adunmo to open an account. The bank employee is normally based in Lagos, but has been at Redemption Camp for Holy Ghost week, and says she has signed up 500 people already.

Adunmo already has a bank account, but decided to open another because the minimum withdrawal amount is 200 naira (about 55p) a fifth of the minimum at her current bank. Shed love to live in the camp, she says, but cant afford it unless she finds work there.

Like all the other businesses on site, banks are attracted by the infrastructure and the sheer numbers in attendance its like having a stall at a music festival. But the tentacles of the Redeemed Christian Church of God reach much further: it says it has five million members in Nigeria, and more at its branches in 198 other countries. Its in virtually every town in Nigeria, and that means some business, Olubiyi says. Anywhere you have two million people congregating, banks are interested.

This also means business for the church, of course. Daddy GOs private jets dont appear out of thin air, though there is plenty of cash flowing in from collection plates which these days are often just card machines.

Religious institutions are tax-exempt in Nigeria. Redeemed authorities say that its income-generating arms pay tax, but it is hard to say where these end and the church begins. In any case, the church has powerful members, so it would take a brave tax-collector to look deeply into its finances.

Pastor
Pastor Adeboye, the general overseer of the Redeem Christian Church of God, is projected live on big screens during the annual convention

In fact, Daddy GO is a former mathematics lecturer, and has clearly not lost his head for figures. He is constantly dreaming up new enterprises including a printing press, hundreds of holiday chalets on the site and a church-owned window manufacturer, which imports the components from China and assembles them to sell or use in camp projects.

This is our peak period. We have produced 200,000 copies of different books and magazines in the past three months, says Ben Ayanda, head of Redeemeds press, dressed in a bright yellow and green tunic and matching trousers.

He plucks Daddy GOs Gems of Wisdom Part V from a pile of papers. If you bring anything less than the tithe of all, you miss the blessings because He is very good in mathematics, one line reads.

At the convention, the last stragglers hurry past the hawkers selling Hallelujah handkerchiefs and a billboard advertising Hallelujah cooking gas, to be there when the headliner comes on.

You can usually tell when Daddy GO is about to appear he is preceded by his personal saxophonist.

Finally, the man who keeps the money coming in, who gives this entire neighbourhood its raison dtre, the de facto mayor of what is effectively an entirely new piece of city, takes his place on the vast stage and picks up the mic. The 75-year-old Daddy GO wears a grass-green short-sleeved suit, bow tie and gold watch. After praying on his knees at the lectern, he climbs to his feet.

Will somebody shout Hallelujah?

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Read more: https://www.theguardian.com/cities/2017/sep/11/eat-pray-live-lagos-nigeria-megachurches-redemption-camp

Michelle Obama tells of being wounded by racism as first lady

Pretending experiences didnt hurt would let perpetrators off hook, says Obama as she praises womens strength

Michelle Obama has spoken about the racism she faced as first lady, as she encouraged women to strive to succeed despite setbacks.

During an armchair conversation in front of 8,500 people in Denver, Colorado, Obama was commended for breaking the glass ceiling by becoming the first black first lady.

Asked which of the falling glass shards cut the deepest, she said: The ones that intended to cut, referencing an incident in which a West Virginia county employee called her an ape in heels, as well as people not taking her seriously because of her colour. Knowing that after eight years of working really hard for this country, there are still people who wont see me for what I am because of my skin colour, she told the crowd.

In the speech, made on Tuesday at the Pepsi Centre in Denver as part of the Womens Foundation of Colorados 30th anniversary fundraising celebration, Obama said she couldnt pretend the experiences didnt hurt because that would let the perpetrators off the hook.

Women, we endure those cuts in so many ways that we dont even know were cut, she said, according to a report in the Denver Post. We are living with small tiny cuts, and we are bleeding every single day. And were still getting up.

She said the wounds of failure hurt deeply but healed with time, and if women acknowledged their scars they could encourage younger girls to strive and succeed.

The Post reported that while Obama largely stayed away from politics, she received cheers from the crowd when she took a few thinly veiled shots at the Trump administration, and boos when she reiterated that she would not be seeking public office.

Public service and engagement will be a part of my life and my husbands life for ever, she added. Both Michelle and Barack Obama have signed book deals with Penguin Random House.

The former lawyer warned against the notion of a nation falling apart, saying that America was a young country that would learn from its mistakes and successes.

The people in this country are universally good and kind and honest and decent. Dont be afraid of the country you live in. The folks here are good, she said, adding that instead of relying on national policies, women needed to take charge in their own lives and communities.

She also talked on a range of topics she advocated for as first lady, including education for girls and health and nutrition for schoolchildren.

If we want girls in Stem (science, technology, engineering and mathematics), we need to rethink how we deliver education. Teachers, a kind word can mean the world to a young girl, she said.

As first lady, Obama launched several campaigns around education, including Reach Higher, which inspires students to complete education past high school, and Let Girls Learn, which helps facilitate educational opportunities for young girls in developing countries.

In May, she made her strongest political intervention by attacking the Trump administrations reversal of regulations to help improve school lunches.

Addressing the crowd in Denver, she mentioned Barack Obamas campaign slogan. It was never yes he can; it was yes we can, she said. When we put so much on a person, on a leader, we absolve ourselves of doing anything else. Were all on a journey together We all want someone who will fix things, but were going to have to fix it together.

She advised people to surround themselves with other powerful figures and never be afraid to fail and to protect what they love. What is going on within us [women] that we dont feel worthy enough to protect the things we value? she asked.

Read more: https://www.theguardian.com/us-news/2017/jul/27/michelle-obama-wounded-racism-first-lady

Maryam Mirzakhani, first woman to win mathematics’ Fields medal, dies at 40

Stanford professor, who was awarded the prestigious prize in 2014, had suffered breast cancer

Maryam Mirzakhani, a Stanford University professor who was the first and only woman to win the prestigious Fields medal in mathematics, has died. She was 40.

Mirzakhani, who had breast cancer, died on Saturday, the university said. It did not indicate where she died.

In 2014, Mirzakhani was one of four winners of the Fields medal, which is presented every four years and is considered the mathematics equivalent of the Nobel prize. She was named for her work on complex geometry and dynamic systems.

Mirzakhani specialized in theoretical mathematics that read like a foreign language by those outside of mathematics: moduli spaces, Teichmller theory, hyperbolic geometry, Ergodic theory and symplectic geometry, the Stanford press announcement said.

Mastering these approaches allowed Mirzakhani to pursue her fascination for describing the geometric and dynamic complexities of curved surfaces spheres, doughnut shapes and even amoebas in as great detail as possible.

Her work had implications in fields ranging from cryptography to the theoretical physics of how the universe came to exist, the university said.

Mirzakhani was born in Tehran and studied there and at Harvard. She joined Stanford as a mathematics professor in 2008. Irans president, Hassan Rouhani, issued a statement praising Mirzakhani.

The grievous passing of Maryam Mirzakhani, the eminent Iranian and world-renowned mathematician, is very much heart-rending, Rouhani said in a message that was reported by the Tehran Times.

Irans foreign minister, Mohammad Javad Zarif, said her death pained all Iranians, the newspaper reported.

The news of young Iranian genius and math professor Maryam Mirzakhanis passing has brought a deep pang of sorrow to me and all Iranians who are proud of their eminent and distinguished scientists, Zarif posted in Farsi on his Instagram account.

I do offer my heartfelt condolences upon the passing of this lady scientist to all Iranians worldwide, her grieving family and the scientific community.

Mirzakhani originally dreamed of becoming a writer but then shifted to mathematics. When she was working, she would doodle on sheets of paper and scribble formulas on the edges of her drawings, leading her daughter to describe the work as painting, the Stanford statement said.

Mirzakhani once described her work as like being lost in a jungle and trying to use all the knowledge that you can gather to come up with some new tricks, and with some luck you might find a way out.

Stanford president Marc Tessier-Lavigne said Mirzakhani was a brilliant theorist who made enduring contributions and inspired thousands of women to pursue math and science.

Mirzakhani is survived by her husband, Jan Vondrk, and daughter, Anahita.

Read more: https://www.theguardian.com/us-news/2017/jul/15/maryam-mirzakhani-mathematician-dies-40

How economics became a religion | John Rapley

The long read: Its moral code promises salvation, its high priests uphold their orthodoxy. But perhaps too many of its doctrines are taken on faith

Although Britain has an established church, few of us today pay it much mind. We follow an even more powerful religion, around which we have oriented our lives: economics. Think about it. Economics offers a comprehensive doctrine with a moral code promising adherents salvation in this world; an ideology so compelling that the faithful remake whole societies to conform to its demands. It has its gnostics, mystics and magicians who conjure money out of thin air, using spells such as derivative or structured investment vehicle. And, like the old religions it has displaced, it has its prophets, reformists, moralists and above all, its high priests who uphold orthodoxy in the face of heresy.

Over time, successive economists slid into the role we had removed from the churchmen: giving us guidance on how to reach a promised land of material abundance and endless contentment. For a long time, they seemed to deliver on that promise, succeeding in a way few other religions had ever done, our incomes rising thousands of times over and delivering a cornucopia bursting with new inventions, cures and delights.

This was our heaven, and richly did we reward the economic priesthood, with status, wealth and power to shape our societies according to their vision. At the end of the 20th century, amid an economic boom that saw the western economies become richer than humanity had ever known, economics seemed to have conquered the globe. With nearly every country on the planet adhering to the same free-market playbook, and with university students flocking to do degrees in the subject, economics seemed to be attaining the goal that had eluded every other religious doctrine in history: converting the entire planet to its creed.

Yet if history teaches anything, its that whenever economists feel certain that they have found the holy grail of endless peace and prosperity, the end of the present regime is nigh. On the eve of the 1929 Wall Street crash, the American economist Irving Fisher advised people to go out and buy shares; in the 1960s, Keynesian economists said there would never be another recession because they had perfected the tools of demand management.

The 2008 crash was no different. Five years earlier, on 4 January 2003, the Nobel laureate Robert Lucas had delivered a triumphal presidential address to the American Economics Association. Reminding his colleagues that macroeconomics had been born in the depression precisely to try to prevent another such disaster ever recurring, he declared that he and his colleagues had reached their own end of history: Macroeconomics in this original sense has succeeded, he instructed the conclave. Its central problem of depression prevention has been solved.

No sooner do we persuade ourselves that the economic priesthood has finally broken the old curse than it comes back to haunt us all: pride always goes before a fall. Since the crash of 2008, most of us have watched our living standards decline. Meanwhile, the priesthood seemed to withdraw to the cloisters, bickering over who got it wrong. Not surprisingly, our faith in the experts has dissipated.

Hubris, never a particularly good thing, can be especially dangerous in economics, because its scholars dont just observe the laws of nature; they help make them. If the government, guided by its priesthood, changes the incentive-structure of society to align with the assumption that people behave selfishly, for instance, then lo and behold, people will start to do just that. They are rewarded for doing so and penalised for doing otherwise. If you are educated to believe greed is good, then you will be more likely to live accordingly.

The hubris in economics came not from a moral failing among economists, but from a false conviction: the belief that theirs was a science. It neither is nor can be one, and has always operated more like a church. You just have to look at its history to realise that.


The American Economic Association,to which Robert Lucas gave his address, was created in 1885, just when economics was starting to define itself as a distinct discipline. At its first meeting, the associations founders proposed a platform that declared: The conflict of labour and capital has brought to the front a vast number of social problems whose solution is impossible without the united efforts of church, state and science. It would be a long path from that beginning to the market evangelism of recent decades.

Yet even at that time, such social activism provoked controversy. One of the AEAs founders, Henry Carter Adams, subsequently delivered an address at Cornell University in which he defended free speech for radicals and accused industrialists of stoking xenophobia to distract workers from their mistreatment. Unknown to him, the New York lumber king and Cornell benefactor Henry Sage was in the audience. As soon as the lecture was done, Sage stormed into the university presidents office and insisted: This man must go; he is sapping the foundations of our society. When Adamss tenure was subsequently blocked, he agreed to moderate his views. Accordingly, the final draft of the AEA platform expunged the reference to laissez-faire economics as being unsafe in politics and unsound in morals.

Trinity
Economics has always operated more like a church Trinity Church seen from Wall Street. Photograph: Alamy Stock Photo

So was set a pattern that has persisted to this day. Powerful political interests which historically have included not only rich industrialists, but electorates as well helped to shape the canon of economics, which was then enforced by its scholarly community.

Once a principle is established as orthodox, its observance is enforced in much the same way that a religious doctrine maintains its integrity: by repressing or simply eschewing heresies. In Purity and Danger, the anthropologist Mary Douglas observed the way taboos functioned to help humans impose order on a seemingly disordered, chaotic world. The premises of conventional economics havent functioned all that differently. Robert Lucas once noted approvingly that by the late 20th century, economics had so effectively purged itself of Keynesianism that the audience start(ed) to whisper and giggle to one another when anyone expressed a Keynesian idea at a seminar. Such responses served to remind practitioners of the taboos of economics: a gentle nudge to a young academic that such shibboleths might not sound so good before a tenure committee. This preoccupation with order and coherence may be less a function of the method than of its practitioners. Studies of personality traits common to various disciplines have discovered that economics, like engineering, tends to attract people with an unusually strong preference for order, and a distaste for ambiguity.

The irony is that, in its determination to make itself a science that can reach hard and fast conclusions, economics has had to dispense with scientific method at times. For starters, it rests on a set of premises about the world not as it is, but as economists would like it to be. Just as any religious service includes a profession of faith, membership in the priesthood of economics entails certain core convictions about human nature. Among other things, most economists believe that we humans are self-interested, rational, essentially individualistic, and prefer more money to less. These articles of faith are taken as self-evident. Back in the 1930s, the great economist Lionel Robbins described his profession in a way that has stood ever since as a cardinal rule for millions of economists. The fields basic premises came from deduction from simple assumptions reflecting very elementary facts of general experience and as such were as universal as the laws of mathematics or mechanics, and as little capable of suspension.

Deducing laws from premises deemed eternal and beyond question is a time-honoured method. For thousands of years, monks in medieval monasteries built a vast corpus of scholarship doing just that, using a method perfected by Thomas Aquinas known as scholasticism. However, this is not the method used by scientists, who tend to require assumptions to be tested empirically before a theory can be built out of them.

But, economists will maintain, this is precisely what they themselves do what sets them apart from the monks is that they must still test their hypotheses against the evidence. Well, yes, but this statement is actually more problematic than many mainstream economists may realise. Physicists resolve their debates by looking at the data, upon which they by and large agree. The data used by economists, however, is much more disputed. When, for example, Robert Lucas insisted that Eugene Famas efficient-markets hypothesis which maintains that since a free market collates all available information to traders, the prices it yields can never be wrong held true despite a flood of criticism, he did so with as much conviction and supporting evidence as his fellow economist Robert Shiller had mustered in rejecting the hypothesis. When the Swedish central bank had to decide who would win the 2013 Nobel prize in economics, it was torn between Shillers claim that markets frequently got the price wrong and Famas insistence that markets always got the price right. Thus it opted to split the difference and gave both men the medal a bit of Solomonic wisdom that would have elicited howls of laughter had it been a science prize. In economic theory, very often, you believe what you want to believe and as with any act of faith, your choice of heads or tails will as likely reflect sentimental predisposition as scientific assessment.

Its no mystery why the data used by economists and other social scientists so rarely throws up incontestable answers: it is human data. Unlike people, subatomic particles dont lie on opinion surveys or change their minds about things. Mindful of that difference, at his own presidential address to the American Economic Association nearly a half-century ago, another Nobel laureate, Wassily Leontief, struck a modest tone. He reminded his audience that the data used by economists differed greatly from that used by physicists or biologists. For the latter, he cautioned, the magnitude of most parameters is practically constant, whereas the observations in economics were constantly changing. Data sets had to be regularly updated to remain useful. Some data was just simply bad. Collecting and analysing the data requires civil servants with a high degree of skill and a good deal of time, which less economically developed countries may not have in abundance. So, for example, in 2010 alone, Ghanas government which probably has one of the better data-gathering capacities in Africa recalculated its economic output by 60%. Testing your hypothesis before and after that kind of revision would lead to entirely different results.

New
The data used by economists rarely throws up incontestable answers traders at the New York Stock Exchange in October 2008. Photograph: Spencer Platt/Getty Images

Leontief wanted economists to spend more time getting to know their data, and less time in mathematical modelling. However, as he ruefully admitted, the trend was already going in the opposite direction. Today, the economist who wanders into a village to get a deeper sense of what the data reveals is a rare creature. Once an economic model is ready to be tested, number-crunching ends up being done largely at computers plugged into large databases. Its not a method that fully satisfies a sceptic. For, just as you can find a quotation in the Bible that will justify almost any behaviour, you can find human data to support almost any statement you want to make about the way the world works.

Thats why ideas in economics can go in and out of fashion. The progress of science is generally linear. As new research confirms or replaces existing theories, one generation builds upon the next. Economics, however, moves in cycles. A given doctrine can rise, fall and then later rise again. Thats because economists dont confirm their theories in quite the same way physicists do, by just looking at the evidence. Instead, much as happens with preachers who gather a congregation, a school rises by building a following among both politicians and the wider public.

For example, Milton Friedman was one of the most influential economists of the late 20th century. But he had been around for decades before he got much of a hearing. He might well have remained a marginal figure had it not been that politicians such as Margaret Thatcher and Ronald Reagan were sold on his belief in the virtue of a free market. They sold that idea to the public, got elected, then remade society according to those designs. An economist who gets a following gets a pulpit. Although scientists, in contrast, might appeal to public opinion to boost their careers or attract research funds, outside of pseudo-sciences, they dont win support for their theories in this way.

However, if you think describing economics as a religion debunks it, youre wrong. We need economics. It can be it has been a force for tremendous good. But only if we keep its purpose in mind, and always remember what it can and cant do.


The Irish have been known to describetheir notionally Catholic land as one where a thin Christian veneer was painted over an ancient paganism. The same might be said of our own adherence to todays neoliberal orthodoxy, which stresses individual liberty, limited government and the free market. Despite outward observance of a well-entrenched doctrine, we havent fully transformed into the economic animals we are meant to be. Like the Christian who attends church but doesnt always keep the commandments, we behave as economic theory predicts only when it suits us. Contrary to the tenets of orthodox economists, contemporary research suggests that, rather than seeking always to maximise our personal gain, humans still remain reasonably altruistic and selfless. Nor is it clear that the endless accumulation of wealth always makes us happier. And when we do make decisions, especially those to do with matters of principle, we seem not to engage in the sort of rational utility-maximizing calculus that orthodox economic models take as a given. The truth is, in much of our daily life we dont fit the model all that well.

For decades, neoliberal evangelists replied to such objections by saying it was incumbent on us all to adapt to the model, which was held to be immutable one recalls Bill Clintons depiction of neoliberal globalisation, for instance, as a force of nature. And yet, in the wake of the 2008 financial crisis and the consequent recession, there has been a turn against globalisation across much of the west. More broadly, there has been a wide repudiation of the experts, most notably in the 2016 US election and Brexit referendum.

It would be tempting for anyone who belongs to the expert class, and to the priesthood of economics, to dismiss such behaviour as a clash between faith and facts, in which the facts are bound to win in the end. In truth, the clash was between two rival faiths in effect, two distinct moral tales. So enamoured had the so-called experts become with their scientific authority that they blinded themselves to the fact that their own narrative of scientific progress was embedded in a moral tale. It happened to be a narrative that had a happy ending for those who told it, for it perpetuated the story of their own relatively comfortable position as the reward of life in a meritocratic society that blessed people for their skills and flexibility. That narrative made no room for the losers of this order, whose resentments were derided as being a reflection of their boorish and retrograde character which is to say, their fundamental vice. The best this moral tale could offer everyone else was incremental adaptation to an order whose caste system had become calcified. For an audience yearning for a happy ending, this was bound to be a tale of woe.

The failure of this grand narrative is not, however, a reason for students of economics to dispense with narratives altogether. Narratives will remain an inescapable part of the human sciences for the simple reason that they are inescapable for humans. Its funny that so few economists get this, because businesses do. As the Nobel laureates George Akerlof and Robert Shiller write in their recent book, Phishing for Phools, marketers use them all the time, weaving stories in the hopes that we will place ourselves in them and be persuaded to buy what they are selling. Akerlof and Shiller contend that the idea that free markets work perfectly, and the idea that big government is the cause of so many of our problems, are part of a story that is actually misleading people into adjusting their behaviour in order to fit the plot. They thus believe storytelling is a new variable for economics, since the mental frames that underlie peoples decisions are shaped by the stories they tell themselves.

Economists arguably do their best work when they take the stories we have given them, and advise us on how we can help them to come true. Such agnosticism demands a humility that was lacking in economic orthodoxy in recent years. Nevertheless, economists dont have to abandon their traditions if they are to overcome the failings of a narrative that has been rejected. Rather they can look within their own history to find a method that avoids the evangelical certainty of orthodoxy.

In his 1971 presidential address to the American Economic Association, Wassily Leontief counselled against the dangers of self-satisfaction. He noted that although economics was starting to ride the crest of intellectual respectability an uneasy feeling about the present state of our discipline has been growing in some of us who have watched its unprecedented development over the last three decades.

Noting that pure theory was making economics more remote from day-to-day reality, he said the problem lay in the palpable inadequacy of the scientific means of using mathematical approaches to address mundane concerns. So much time went into model-construction that the assumptions on which the models were based became an afterthought. But, he warned a warning that the sub-prime booms fascination with mathematical models, and the busts subsequent revelation of their flaws, now reveals to have been prophetic it is precisely the empirical validity of these assumptions on which the usefulness of the entire exercise depends.

Leontief thought that economics departments were increasingly hiring and promoting young economists who wanted to build pure models with little empirical relevance. Even when they did empirical analysis, Leontief said economists seldom took any interest in the meaning or value of their data. He thus called for economists to explore their assumptions and data by conducting social, demographic and anthropological work, and said economics needed to work more closely with other disciplines.

Leontiefs call for humility some 40 years ago stands as a reminder that the same religions that can speak up for human freedom and dignity when in opposition, can become obsessed with their rightness and the need to purge others of their wickedness once they attain power. When the church retains its distance from power, and a modest expectation about what it can achieve, it can stir our minds to envision new possibilities and even new worlds. Once economists apply this kind of sceptical scientific method to a human realm in which ultimate reality may never be fully discernible, they will probably find themselves retreating from dogmatism in their claims.

Paradoxically, therefore, as economics becomes more truly scientific, it will become less of a science. Acknowledging these limitations will free it to serve us once more.

Main image: Maxian/Getty/iStockphoto/Guardian Design

This is an edited extract from Twilight of the Money Gods: Economics as a Religion and How it all Went Wrong by John Rapley, published by Simon & Schuster on 13 July at 20. To order a copy for 17, go to bookshop.theguardian.com or call 0330 333 6846. Free UK p&p over 10, online orders only. Phone orders min p&p of 1.99.

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Read more: https://www.theguardian.com/news/2017/jul/11/how-economics-became-a-religion