By MANFRED BACK & LUIZ GONZAGA BELLUZZO*

Throughout the 19th century, economics took as its paradigm the imposing construction of classical mechanics and as its moral paradigm the utilitarianism of the radical philosophy of the late 18th century.

1.

We begin with a statement that will certainly displease the followers of the dark science. The history of economic thought offers us the spectacle of the naturalization of the economy. The economy must present itself as an autonomous sphere of human and social life in which natural laws prevail, to which individuals should submit.

From Smithian infancy to the decrepit maturity of rational expectations, conflicts of conception and method have plagued the intellectual trajectory of the dark science. In moments of heightened controversy, the princes and priests of economic science call upon the four horsemen of orthodoxy—naturalism, individualism, rationalism, and equilibrium—to rein in the dissenting mob.

Natural laws, those that have the same form as the laws of physics. From Adam Smith onwards, this movement towards the paradigm of physics became increasingly important. Not only was there an intellectual environment that favored this approach, but the economic dimension, at the same time, became increasingly important and increasingly separated from the others.

Throughout the 19th century, economics took as its paradigm the imposing construction of classical mechanics and as its moral paradigm the utilitarianism of the radical philosophy of the late 18th century. homo economicus, endowed with perfect knowledge, seeks to maximize its utility or its gains in the face of resource restrictions imposed on it by nature or the state of the art.

This mainstream metaphysics presupposes an ontology of the economic that postulates a certain conception of the way of being, a vision of the structure and connections of society. For this paradigm, society, where economic action develops, is constituted through the aggregation of rational individuals.

Such economic premises, repeated every single day, are nothing more than rhetoric disguised as science. This so-called rationality is manufactured through beliefs and dogmas, disguised by numbers, equations and algebraic functions. Econometric models are touted to the four winds of the planet, as if they were the cornerstone of a unique knowledge, as indisputable as the Holy Trinity. A rococo style of expression, which is reproduced in the eternity of economics courses! Leveling statistics with mathematics! An algebraic dialect that few understand! It is designed so that they do not understand!

The important thing for these alphanumeric sophists is not to understand and study economic relations, but to transform a supposed static reality into a game of cause and effect, and voila! One of the ten commandments received by Luke, not the apostle, but the icon of rational expectations, is that money is neutral.

2.

In the “equilibrist” model that organizes society inhabited by rational, utilitarian individuals who own goods and factors of production, money is only formally necessary as a means of account and exchange. Money is neutral and determines the general price level without any long-term effect on the economy of exchange of goods, whose relative values ​​are measured by the marginal utility of the agents. It is also in this space of measurement that the “production decisions” of the individuals who own capital and labor are made.

This form has its own code, mix some equations and data, and some predictions, and to give credibility, impose divine force on the words.

There, by divine grace, arguments cannot be contested; on the contrary, they are pampered and spoiled. And revered as gods, “God” is not doubted or contested; it is a matter of faith and belief! Just like the Roman Curia, what they say is law! One of the ten commandments given to Moses on Mount Sinai said: You shall not take the name of the Lord your God in vain, for the Lord will not hold him unpunished who takes his name in vain.

In the commandments of economists: Thou shalt not take the name of equilibrium, thy “God,” in vain, for the Lord of the Academy who takes possession of reality in vain is in marginal utility, in the productivity of factors. Thou shalt not give false econometric testimony. Honor the form, the method, the bureaucracy, as if they were thy father and mother.

If you ask the sages of chrematistics, in front of an audience, how do I produce bread and sell it on the market? Wait, my friend, I need to build an econometric model of the bread market! According to our expectations, quantitative analyses, other things being equal, the market will grow 20% by 2035, we estimate a global market for this product in the order of 7 billion dollars, get ready to export! Brazil will be one of the largest exporters of bread in 2035, if it solves the fiscal problem, ends the retirements, and freezes the minimum wage.

I would ask: what is it like to live on a minimum wage each month, to pay rent, clothes and food? Don't ask difficult questions that are relevant to people's daily lives. You don't understand anything!

After all, what are economists for?

Robert Skidelsky, biographer of John Maynard Keynes, offered us a reading of the book What's wrong with the economy?: “Economics is not progressive, in the sense of, say, physics. Progress in economics consists mainly in greater formalization rather than in the discovery of new truths. No truth in economics, once proclaimed, has ever been refuted. This argues very strongly for not consigning alternatives to mainstream current to the dustbin of exploded fallacies.”

Third, economics is not a natural science but a social science (Keynes called it a moral science). In physics, the interaction of bodies is fixed by physical laws, but in economics it is fixed by the context, values, and social norms, which are variable parameters. Since economics has no universal truths, it has no more right than sociology or history to claim a super theory or metamethodology, with catechetical teaching.

“Because the purpose of an economy is not just to create jobs so that people can survive. It is to raise the standard of living for everyone and to ensure that prosperity is shared.” (William Lazonick, expert on American business corporations).

*Manfred Back He has a degree in economics from PUC-SP and a master's degree in public administration from FGV-SP..

* Luiz Gonzaga Belluzzo, economist, is Professor Emeritus at Unicamp. Author, among other books, of Keynes's time in the times of capitalism (countercurrent). [https://amzn.to/45ZBh4D]

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