imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
latest news
best of news




A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List


IMC Network:

Original Cities africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

Economist criticizes "pathological allegience" to economic models

by Rudolf Hickel Tuesday, May. 15, 2012 at 4:08 AM

The crisis was born when Maggie Thatcher and then Bill Clinton deregulated the financial markets. The explosive force that was detonated was incalculable. Economics gave support because it provides models.


Rudolf Hickel urges a new economic theory

[This interview published on 4/13/2012 is translated from the German on the Internet, ]

In the view of economist Rudolf Hickel, many of his colleagues lack courage to fight crises and prevent them from the start with new ideas. Lessons from the “failure of finance-driven capitalism” must be drawn.

Dradio: During the economic- and financial crisis, a system collapsed that believed too much in the market and pursuit of profit. Whenever politics did something to combat the Euro crisis, these markets, the financial markets, had to be satisfied or at least calmed.

The surprising survival of neoliberalism is the title of the English economist Colin Crouch’s latest book. In Germany, some are now surprised that economics seems to have learned so little from the crisis. A circle of nearly 100 professors emphasized this in a Memorandum for the Renewal of Economics. Rudolf Hickel, professor at the University of Bremen, was one of the first signers and joins us for an interview.

Dradio: Is this crisis that we experience a child born in the economic faculties?

Hickel: Not immediately. It was not born there. The crisis was born when Maggie Thatcher and then Bill Clinton deregulated the financial markets. The explosive force that detonated was incalculable. Economics indirectly gave support because it provides models according to the motto: financial markets are never susceptible to crises. They can always operate optimally. The banks function like clockwork. This kind of political advice obviously has a great responsibility for the crisis. The advisory economy must now finally draw the lessons from this crisis, rebu9ilt its textbook models and include the financial markets’ susceptibility for crises in the future.

Dradio: You say the guild did not do this in the past. What is the reason? Is imagination lacking?

Hickel: The reasons are clear. The courage to grapple with the rulers is lacking. When one criticizes the banks, for example when Deutsche Bank is decried for its gigantic speculative businesses with food on the commodity futures exchange, the interaction can become cheerless and nasty. There are really two reasons: first, the somewhat convulsive allegiance to the elegance of the models. According to the Hegelian motto, too bad for reality if it doesn’t agree with the model. Secondly, the courage to organize the guild critically is lacking, strictly speaking to understand the lessons of the failure of finance-driven capitalism.

Dradio: Perhaps economics thinks according to the basic principle of the economy, namely the principle of the market, buy, sell and make as much profit as possible.

Hickel: Well, what can you say, if that were the substance of economics, I would suggest abolishing it since it would really have lost its very important function. Economics must be critical economics. There are marvelous historical predecessors. Adam Smith, one of its founders, saw very critically. Economics must be critical economics. There are marvelous historical predecessors. Adam Smith, one of its founders, saw very critically. Crisis and malformation can be triggered when the economic profit motive is followed or the Homo oeconomicus is assumed, a highly-individualized, abstract, socially-empty figure that always maximizes his advantages. No welfare in the macro-economic context occurs. That welfare is really the task of economics.

The regulars’ table and current policy ignore this. But our job – in our study group Alternative Economic Policy – is two fold, first showing that such systems are prone to brutal crises – always afflicting those who had nothing to do with the crisis – and secondly demonstrating models of coming out of this.

Dradio: The question is why isn’t politics changed? When we look back in economic history, there is this terrific story of the rise of neoliberalism. Economists smiling condescendingly around Milton Friedman developed this theory in the 1970s. As you mentioned, politicians like Maggie Thatcher in Great Britain and Ronald Reagan in the 1980s raised this neoliberalism on their banners. In this situation of crisis, politics must successfully show alternatives and then make them into policy.

Hickel: Yes, when these alternatives are shown, there must be massive interference in the past controlling powers of the economic system. This is the point where nothing has happened. An example could make this clear. In 2009 the German chancellor under the shock of the crisis flew to London and declared there may never be financial market products, financial markets and financial institutions that are not strictly controlled. Today we ask what is left of this resolve. Today the sentence is reversed; the financial markets and the banking system must be spared. This obviously reflects the conditions of the political landscape.

Our problem which is the problem of criticism is that our proposals always encounter enormous opposing interests and cannot be simply realized. In the meantime there is a gradual learning process even in mainstream economics. Mainstream economics has been so widely criticized that people now understand we need a new theory that gives special emphasis to a much clearer policy.

Dradio: We ask questions about this new theory. What does it look like? What would our economy look like if it were based on such a theory?

Hickel: Well you know – I say very plainly and a little superficially – the markets must be tamed. The financial markets must be restrained. The banks must be taken and smashed, particularly in the investment- and speculative area that must be reduced throu9gh regulation.

Then we need a financial transactions tax to contain the international speculative businesses. There is already an instrument for this. We only use the market forces where they are efficient. When they produce crises and grave burdens on the economy or on society and politics, counter measures are necessary, a stronger primacy of creative policy. Politics itself must obviously be re-structured since politics failed tremendously in Germany in 2002 and 2003 with the deregulation of the financial markets.

Dradio: But isn’t state correction and state regulation the logic of these markets which occurs after such a crisis situation – so it runs better? Then people say any regulation limits growth so the economy falls again in the international competition. Isn’t that the inner logic of what must be called the end of capitalism?

Hickel: We now have a bank bailou8t fund that was created and into which the banks pay. This starts from the logic that you described, that banks at the end are paid out of a pot when the next crisis erupts. We say crisis must be prevented, for example through prohibition of the shadiest speculative instruments. The commodity futures market must be controlled. The third imperative is fighting the shadow banks. A broad consensus exists from the German government’s chief advisor Issing to the World Bank that these shadow banks must be fought and not become concrete.

Dradio: Then we will see whether this great consensus leads to any political results.

Hickel: That is the great question!

Dradio: Rudolf Hickel, economics professor and first signer of the Memorandum for a Renewal of Economics, hearty thanks for this interview!


Hickel, Rudolf, “The Banks Must Serve the Real Economy”

Altvater, Elmar, "The Great Crash or the Century Crisis"

Batko, Marc, "Shouting from the Caboose"

Konasz, Tomasz, "The Crisis Explained"

Lohoff, Ernest and Trenkle, Norbert, "The Great Devaluation"

Reiber, Norbert, "Stagnation as a Trend”

Schutze, Ingo, "Our Beautiful New Clothes"

Report this post as:

Local News


lausd whistle blower A10 11:58PM

Website Upgrade A10 3:02AM

Help KCET and UCLA identify 60s-70s Chicano images A04 1:02PM

UCLA Luskin: Casting Youth Justice in a Different Light A02 11:58AM

Change Links April 2018 A01 11:27AM

Nuclear Shutdown News March 2018 M31 6:57PM

Join The Protest Rally in Glendale on April 10, 2018! M29 7:00PM

Join The Protest Rally in Glendale on April 10, 2018! M29 6:38PM

Spring 2018 National Immigrant Solidarity Network News Alert! M19 2:02PM

Anti-Eviction Mapping Project Shows Shocking Eviction Trends in L.A. M16 5:40PM

Steve Mnuchin video at UCLA released M15 12:34AM

Actress and Philanthropist Tanna Frederick Hosts Project Save Our Surf Beach Clean Ups M06 12:10PM

After Being Told He's 'Full of Sh*t' at School Event, Mnuchin Demands UCLA Suppress Video M02 11:44AM

Resolution of the Rent Strike in Boyle Heights M01 6:28PM

What Big Brother Knows About You and What You Can Do About It M01 3:30PM

Step Up As LAPD Chief Charlie Beck Steps Down F14 2:44PM

Our House Grief Support Center Hosts 9th Annual Run For Hope, April 29 F13 12:51PM

Don’t let this LA County Probation Department overhaul proposal sit on the shelf F13 11:04AM

Echo Park Residents Sue LA Over Controversial Development F12 8:51AM

Former Signal Hill police officer pleads guilty in road-rage incident in Irvine F09 10:25PM

Calif. Police Accused of 'Collusion' With Neo-Nazis After Release of Court Documents F09 7:14PM

Center for the Study of Political Graphics exhibit on Police Abuse posters F07 9:50AM

City Agrees to Settle Lawsuit Claiming Pasadena Police Officer Had His Sister Falsely Arre F04 3:17PM

Professor's Study Highlights Health Risks of Urban Oil Drilling F04 12:42PM

Claims paid involving Pasadena Police Department 2014 to present F04 10:52AM

Pasadenans - get your license plate reader records from police F03 11:11PM

LA Times Homicide Report F03 1:57PM

More Local News...

Other/Breaking News

What does the Quran Say About Islamic Dress?? A21 4:15PM

Biodiversité ou la nature privatisée A20 11:22AM

The Market is a Universal Totalitarian Religion A20 7:14AM

Book Available about Hispanics and US Civil War by National Park Service A19 5:52PM

The Shortwave Report 04/20/18 Listen Globally! A19 4:01PM

The Republican 'Prolife' Party Is the Party of War, Execution, and Bear Cub Murder A19 11:48AM

Neurogenèse involutive A18 9:21AM

Paraphysique de la dictature étatique A16 10:13AM

Book Review: "The New Bonapartists" A16 3:45AM

The West Must Take the First Steps to Russia A14 12:25PM

Théorie générale de la révolution ou hommage à feu Mikhaïl Bakounine A14 3:30AM

The Shortwave Report 04/13/18 Listen Globally! A12 3:50PM

“Lost in a Dream” Singing Competition Winner to Be Chosen on April 15 for ,000 Prize! A12 3:48PM

The World Dependent on Central Banks A12 4:43AM

Ohio Governor Race: Dennis Kucinich & Richard Cordray Run Against Mike DeWine A11 9:40PM

March 2018 Honduras Coup Again Update A10 10:52PM

Apologie du zadisme insurrectionnel A10 3:33PM

ICE contract with license plate reader company A10 1:14PM

Palimpseste sisyphéen A09 11:23PM

Black Portraiture(S) IV: The Color of Silence...Cuba No...Cambridge Yes A09 5:32AM

Prohibiting Micro-Second Betting on the Exchanges A09 4:18AM

Prosecutors treat Muslims harsher than non-Muslims for the same crimes A08 10:33PM

Amy Goodman interview on cell phone safety A08 10:29PM

Mesa, Arizona police officer kills unarmed white man A08 9:50PM

Israeli leaders should be prosecuted for war crimes A08 9:48PM

Paraphysique de l'autorité A08 12:11AM

Two Podcasts on fbi corruption A06 10:13PM

Fbi assassins assault & try to kill DAVID ATKINS A06 7:29PM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy