Amity Shlaes, author of The Forgotten Man: A New History of the Great Depression (which our own CJ Malone reviews here) writes concerning the recent Harvard student “Ec 10″ walkout, “The students are correct that Harvard’s economics instruction could use some diversifying. But not the kind they think.”
The students’ gripe: “Economics as taught in this class, formally called Economics 10, failed to prevent the financial crisis and does nothing to narrow the gap between rich and poor.”
Shlaes agrees, sort of: “Macroeconomic theory did fail to predict the most recent recession. At Harvard in 2007, many professors and students took for granted that we were in an era of ‘great moderation,’ and that life should henceforth progress smoothly down the decades.”
She writes, “It’s also true that there is a gap in the U.S. between rich and poor; although whether that’s a problem per se has to be debated.” (Emphasis added.)
“What the students get wrong,” Shlaes continues, “is their proposed solution. There are two theories that could have predicted the financial crisis of 2008, and that have much to say about inequality. Neither of them would be considered ‘progressive.’
The full article is here.