A guest post by commenter Bill:
Economists form the high priesthood of the Liberal social order. Policy analysis is normally carried out in the language of economics. Almost always, policy analysis just is cost-benefit analysis. Even arguments about inequality are really just arguments about how the cost-benefit ratios should weigh the costs and benefits of policies to particular people.
The courtier whispering in the Prince’s ear is often an economist. If a federal or state agency has a substantial policy analytic capability, then it has many economists. The government’s demand for Ph.D. economists is so vast that these good-paying, easy, benefit-laden, research-friendly jobs are considered a failure mode for a newly minted Ph.D. on the job market. A worse failure mode is to be paid even more by a firm specializing in litigation consulting (economists’ blessings are so powerful that, in significant areas of litigation, it is effectively mandatory to hire one to make the appropriate incantations in court). Worse even than that is to become a beltway bandit: to work for one of the dizzying array of firms which sell economists’ blessings to federal agencies and others lobbying Congress. Cushy jobs as talking heads for think tanks or industry research groups or (horrors) state government bureaucrats are almost beneath consideration.
This dominance is often and bitterly commented upon by humanists and by other social scientists. Though it becomes more extreme, it is not especially new. Where does it come from? One is tempted to notice that economists are smarter than humanists or other social scientists, but this explains nothing. Economists are smarter because 1) people are admitted to graduate programs largely on the basis of IQ and 2) more people want to become high priests than want to become the butt of the high priests’ jokes. So, the causation goes the other way, from high priesthood to smarts.
Tyler Cowan had an interesting article last week in the Times about the relationship between Economics and Liberalism (hat tip: Steve Sailer). Cowen writes the article to flog immigration, but the way he flogs it is interesting. The success of economics in becoming Liberalism’s high priesthood is due to the sheer, tail-wagging enthusiasm with which it has embraced Liberalism’s central conceits.
Liberalism has rival conceptions of the social good. On the one hand, Liberals conceive of the good as lying in maximizing the freedom of individuals to make their own choices—this conception is present in Nozick but also Rawls and Sen. On the other hand, Liberals conceive of the good as lying in maximizing the hedonic experience of the population a la Bentham.
The crowning achievement of economics was to demonstrate the fundamental compatibility of these two rival conceptions. As Adam Smith intuited “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest,” and “He intends only his own gain, and he is . . . led by an invisible hand to promote [society’s interest].”
Probably the greatest economists of the 20th C, Kenneth Arrow and Gerard Debreu, are justly famous for demonstrating the truth of this synthesis, that free markets promote essentially Benthamite ends, using that very most approved-of Liberal analytic tool: mathematics in the service of abstract theory, specifically the abstract theory of rational choice. Thus economics can claim to harmonize and thus buttress Liberalism’s central normative claims using both a heroic conception of man as rational chooser and the tools of science, or at least those of the conception of science Galileo plagiarized from Pythagoras: “Mathematics is the language in which God has written the universe.”