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Just as there are two completely disparate things we call 'capitalism' (crony and free-market), so too are there multiple and incompatible disciplines all of which are called 'economics'. Stiglitz I put into the 'Crank Economics' field. He diminishes the value of having a PhD in economics. He makes the Nobel Prize seem like a dime store trinket.

It's as if astronomy and astrology were called the same thing.

Economics has a branding problem.

Is this an honest man?

Let's look reality in the face. He's not even trying to be honest.

This is a very serious problem in economic science, a strong contingent of leftists steeped in an ethic of cultural dominance which sanctions imposing a bullshit narrative on everyone that everyone knows is essentially a lie -- a great twisting and suppressing of the unavoidable, widely known actual facts of the matter.

It's a disgrace. And like the emperor with no clothes, no one says a word.

It's remarkable in itself that anyone has spoken the truth about Krugman, but only because the man has made his lies directly personal against working peers at top 5 universities, If he had only lied about ideas and facts and history and politicians and policy wonks and the economy and the work of dead men, most everyone would have pretended no ethical disgrace had occurred.

If Glass Steagall was the cure for the banking problem, why did the depression continue for eleven more years after it was passed in 1932?

I am concerned about the entire Nobel process when this apparent simple thinking is so rewarded.

Joe Stiglitz clearly lives in an alternative universe. One in which repeated incantations obviously are substitutes for history or reasoning.

"Markets don't work." "Markets don't work." "Markets don't work."

And how many times do historians have to demonstrate that the Great Depression was not a "failure" of unregulated capitalism before this lie is put to rest.

As for having "vested interests" -- in a free (or at least a lot freer) market, economists, primarily, either teach or offer "forecasts" to businesses, or amuse themselves with "models."

It is the Stiglitz's of the world who have the vested interest in getting people to believe that "market's don't work," so they can be employed by governments to play Adam Smith's "man of system" who gets to move us all about on the "great chessboard of society" according to how they think we should be directed and arranged.

That with his own personal, imperfect "asymmetric" information, he might generate huge "government failures" that disrupt and ruin multitudes of lives impacted by his regulatory and interventionist designs, well, I guess he forgot to include that possibility in the video.

It shows the bankruptcy of too much of the "mainstream" economics profession that hucksters and conmen like him get taken so seriously.

It is a disgrace to any level of economic honesty.

Richard Ebeling

Very odd clip. But I do think it shows the limits of economics as a "science." I am not saying that Stiglitz's economics is just as good as anyone else's. What I am saying is that when you deal with issues that are as interwoven with political, moral, and ideological considerations, economists have -- in practice -- a hard time keeping all of these considerations separate. He is not wrong that economists can have an interest in believing certain things. But Stiglitz is not the exception he thinks he is. After all, he is in the business of promoting Soros's brand of "new" economic thinking.

Lucas, on the other hand, thinks of economics as the discipline that invents toy economies that do not "easily" relate to real economies or real economic policy. But he loves his mathematical precision. What is his interest? Not the real world, I am afraid.

So the answer is they both fit into a profession that has lost its way.

The reason is that as David Colander and Ric Holt and I explained nearly a decade ago, "mainstream" is a sociological category, those dominating the profession, not an intellectual category. So it is a big tent that includes people who may have quite different ideological perspectives and methodological approaches.

This contrasts with Pete's "mainline" economics, which is an intellectual category. And, there is no question that Stiglitz is one of the world's most productive and influential economists, whatever one thinks of his views on the many topics that he has written and lectured about. He has written about an enormous number of areas of economics over nearly half a century, with many of these papers technical and non-ideological.

FH, how is he being dishonest? You may disagree with what he says, but I think he is stating his views in a pretty straightforward manner. And why are you dragging Krugman into this? Stiglitz and Krugman do not see eye to eye on all issues, and Stiglitz has never to my knowledge engaged in the kind of personalistic slamming that Krugman has been known for.

Richard, he does say "markets do many marvelous things" near the end of this brief talk.

Oh, and Mintzhusband (?), The GD did not go on for another 11 years after 1932 by any measure. Technically speaking it went on for only one more year, although there was the "secondary" recession of 1937-38 when GDP again declined. It is certainly true that most people still felt "depressed" pretty much through the 1930s because unemployment remained high, even as it was mostly declining, except for 1937-38. Some argue that it did not really fully end until the US entered WW II, but that was 1941, not 1943.

It seems a weak performance to me. Stiglitz is totally putting across the idea that we had deregulation of financial markets that led to the crisis. That's simply not true. Everyone recognizes the problem of moral hazard created by too bit to fail. That just ain't "capitalism" in any sense that contrasts with "government." And he seems to say that banking crises were off when we had G-S on again when we lost G-S. That's just factually wrong. I know he's talking to Motley Fool and not writing a journal article, but it seemed pretty poor to me.

Sorry, I think I'm being cryptic. "G-S" is Glass-Steagall. And, of course Gramm-Leach-Bliley did not "repeal Glass-Steagall," but only the separation between investment and commercial banking.


I would agree with you and not him that ending Glass-Steagall was not a major cause of what happened. Clearly this is not one of his better performances.

"ending Glass-Steagall was not a major cause of what happened"

For an educated man to claim that it was *the* cause and the *only* cause is DISHONEST.

" Stiglitz is totally putting across the idea that we had deregulation of financial markets that led to the crisis. That's simply not true."

Exactly. An educated man trying to hoodwink the public with claims which are simply not true and which are self-evidently titanically misleading is DISHONEST.

We can talk about dishonest car salesmen, and dishonest politicians, and dishonest husbands, and dishonest lawyers, and dishonest doctors, etc -- we need to be able to talk just as readily about dishonest professors and dishonest economists.

Stop is with the guild mentality of defending the bad actors in one's own profession.

I hate it when guild members in the professions of medicine or the law protects and fail to discipline the bad actors in their own guild, and the same pathology is too common among professors and academia generally.


Are you aware of the rule that using caps discredits one's argument? It is not as strong a rule as Godwin's Law about bringing up Hitler, but yelling that Stiglitz is "DISHONEST," completely discredits your argument. He may be wrong, but someone is dishonest when they lie about what they know to be true. I am reasonably certain that Stiglitz believes that ending Glass-Steagall, along with some other deregulatory moves (and some failures to regulate, particularly the shadow banking system), were a major cause of what happened. He may be wrong, but he is not dishonest.

the mainstream must be a widestream for Lucas and Stiglitz to be in the same river.

Easy one. Expanding upon Mr Rose above, it means that if you are "out of the mainstream," you must be a kook indeed.

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