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Its Time to Merge Business and Politics

Before economics became a separate branch of study, scholars like Adam Smith used to write as political economists, examining the nature of production and its relationship to government. The fields have since split, and while there are those who specialize in political economy, there's a basic divide between political scientists, who study politics, and economists, who study ecologies of production. We see that in our newspapers too--a section on politics, a section on business, and while the twain meet from time to time, they are generally treated as distinct.

This divide is dangerous today--even as fewer and fewer people read newspapers in its section form--because it has reinforced in the culture a sense that economics, and business, is a separate expertise, somehow removed from questions of politics. Of the dozens of panels I've watched on the financial crisis, almost all are populated entirely by people with a financial services background and economists. As Simon Johnson regularly points out, there's a missing element here--this is a political crisis as much as an economic one.

This category choices: the financial crisis nomenclature, the choice of panelists, the choice of experts--it itself reinforces the idea that economics can be understood separately from politics, and that, as so many have suggested implicitly or directly, it would be far better if we could keep this roudy Congress out of it.

Zephyr Teachout

May 1, 2009

Before economics became a separate branch of study, scholars like Adam Smith used to write as political economists, examining the nature of production and its relationship to government. The fields have since split, and while there are those who specialize in political economy, there’s a basic divide between political scientists, who study politics, and economists, who study ecologies of production. We see that in our newspapers too–a section on politics, a section on business, and while the twain meet from time to time, they are generally treated as distinct.

This divide is dangerous today–even as fewer and fewer people read newspapers in its section form–because it has reinforced in the culture a sense that economics, and business, is a separate expertise, somehow removed from questions of politics. Of the dozens of panels I’ve watched on the financial crisis, almost all are populated entirely by people with a financial services background and economists. As Simon Johnson regularly points out, there’s a missing element here–this is a political crisis as much as an economic one.

This category choices: the financial crisis nomenclature, the choice of panelists, the choice of experts–it itself reinforces the idea that economics can be understood separately from politics, and that, as so many have suggested implicitly or directly, it would be far better if we could keep this roudy Congress out of it.

Instead, I think we ought be pressing to encourage Congress to be more involved in responding to the crisis. I am heartened by proposals for a new Pecora Commission, and I’m hopeful that Congress will start to use more of its muscle to bring forward new proposals, countering the administrations. Why? Because business and politics are already merged, but if we want people to feel more competent, to feel the power that they actually have (but aren’t always sure how to use) over the future of how we live, how we produce, and what we produce, we need to get over this artificial divide between economics and politics.

I’d like to see the business writers doing more political writing, and vice versa. I’d like to see much more economic education in schools. I’d like to see clear, simple, five minute explanations of PPIP and TARP that I can find on youtube.

And the questions of production, of what we want to treat as "too big to fail," of what companies we want to bail out, are deeply political questions, not questions for experts, but choices for citizens. Informed citizens, yes, but citizens.

Zephyr TeachoutZephyr Teachout, a Nation editorial board member, is a constitutional lawyer and law professor at Fordham University and the author of Break ’Em Up: Recovering Our Freedom From Big Ag, Big Tech, and Big Money.


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