What is money? To most, it is currency in the physical form of bills and coins. To others, it encompasses any form of financial credit that mediates present versus future consumption. To the author Stefan Eich, it is an institution that was historically conceived to promote social justice and democracy, but over time has been neutered of its political nature as a public good.
How will the year 2020 be remembered? No doubt the headline event was the coronavirus pandemic, which shuttered schools, factories, and hospitality services, leading to a contraction of per capita income for ninety-five percent of the world’s economies. For Europe, the acrimonious exit of the United Kingdom from the European Union would serve as a stark reminder of how fragile supranational institutions are in the face of popular fury. Following the murder of George Floyd, similar rage at police brutality marked a turning point in the Black Lives Matter movement in the United States, which preceded a combative presidential election that denied Donald Trump a second term. And the world endured one of its hottest years on record, with surface temperatures reaching nearly one degree above the 141-year average as fires burned through Australia and the United States.
Thirty-two years since his death, Colin Clark (1905–89) remains an obscure name in Australia and the discipline of economics. This relative anonymity may strike those who know of his academic achievements as odd, even unjust, as Clark was an outspoken and occasionally brilliant intellectual. A protégé (and later apostate) of John Maynard Keynes, a British Labour party candidate for South Norfolk, a Queensland state statistician, and a scholar at Cambridge, Monash, Oxford, and Queensland, the British-born Clark was a pioneer of national accounting and made numerous contributions to various fields of economics. These were tempered, however, by his ideological conservatism, peripatetic employment, and uneven record of economic forecasting.
Who was John Maynard Keynes? Was he the bookish Cambridge don who penned ambitious theories to overturn the tenets of economics and political liberalism? Or was he Baron Keynes of Tilton, the ardent imperialist who viewed British rule as a benevolent force bringing justice, liberty, and prosperity to the societies it administered? Was he a meticulous Lothario who kept lists of his hookups with anonymous men on notecards? Was he also a political statesman who lambasted the intransigency of his colleagues during fraught negotiations in two world wars?
It is a truth universally acknowledged that pride comes before a fall, and ‘Anyone with a historical sense would have realised that the hubristic attempt to make the world into a frontier and culture-free single market would end in tears.’ This opening salvo in Professor Robert Skidelsky’s new book is part of his answer to what is wrong with economics. Besides arrogance, this includes amorality, ahistoricism, sociopathy, over-formalisation, and unscientific dogmatism.