Architectural Blatherations

The Smug Annoyance That is Freakonomics

top rule

The Good Oil

The book and website Freakonomics is a wildly successful media enterprise run by Dr Steven D. Levitt, an economics professor, and Mr Stephen J. Dubner — the Freakonomists. They talk of all the sort of sociological matters that we bring up on this site. You'd think we had something in common. Wrong. We applaud their success, but object to their theories: our guru Prof Pierre Bourdieu stands aghast at the ideas of their guru, Prof Gary Becker.

In the Global Financial Crisis of 2008-2009, the Freakonimists' theoretical apparatus collapsed around them. The Wall St Masters of the Universe that this apparatus had justified and nurtured found themselves either unemployed or hiring security to protect themselves against angry mobs armed with pitchforks. In a massive fit of cognitive disonnance, Dr Levitt's master, Gary Becker, turned to issuing booboid editorials in an attempt to preserve his legacy— a legacy that shrivels by the day, rather like Alan Greenspan's. Dr Levitt has very sensibly kept his head down since. On his academic salary, he can't afford 24-hour security against rampaging mobs.

The Freakonomists' last book, published October 2009, met with a withering storm of criticism for its lazy scholarship, its misrepresentation, and its gosh-shucks credulity. Don't believe us: just google "climate warming Levitt". For a quick fix, try The Parable of Horseshit.

Rogue like Prince Charles

In both the book and subsequent media manifestations, the Freakonomists spin themselves as cha-cha bright sparks: rogue economists is their publicists' favoured term; wild and wacky yet with theoretically brilliant new takes on life and the universe.

HRH Prince Charles, Prince of Wales
His Rogue Royal Highness The Prince Charles, Prince of Wales.

Reality check. The Freakonomists are as rogue as HRH Prince Charles opening a plastic extrusion factory; as rogue as Bill O'Reilly interviewing Rupert Murdoch while his Fox News contract is up for negotiation. That's how rogue the Freakonomists are.

They portray themselves as so-out-of-the-box-its-not-funny zany freethinkers, the economists' Andy Kaufman: at the edgy fringe of their calling, always on the verge of ostracism.

A much more accurate analogy would be Bob Hope: safe, comfy, and cosy; with a heritage going back to vaudeville. Dr Levitt parks his backside in a plush appointment in the very heart of complacent economic academic orthodoxy; not at its edgy avant-garde fringes. His generous pay-cheque {paycheck} is guaranteed for years to come. His theoretical stance has been economic orthodoxy for almost fifty years. It is not rogue, and it is not freaky. It is the very essence of establishment economics.

His is the cheeky face of a very long established smug economic regime usually known as Rational Action Theory (RAT). In thousands of papers, in hundreds of conferences, and in dozens of professorial appointments, this church has spent decades creating a vast theoretical apparatus to justify one simple statement:

rich white American males like us rule, and so we should. Cope with it..

We disagree.

The smug annoyance that is Rational Action Theory

Our target here is the smug RAT theorists, rather than the whacky Freakonomists in particular (although they have willingly put their heads above the parapet). In the table below, we give a fruity characterization of the RAT ideas compared to those of our own Bourdivin guru.

Rational Action Theorists on reality Bourdivins on reality
People act rationally. Without doubt the most stupid assumption made in the history of the social sciences. One so manifestly false that only people who have had no contact with reality for years could believe it—such as the senile; Wall St bankers; Fox News commentators; the homeless; or tenured professors.…Oh, wait.
At best, we Bourdivins say, people act reasonably.
To rephrase that: People have objectives and tend to choose the correct way to achieve them. You mean like the Bush administration in Iraq? Or the Wall St bankers who turned trillions in wealth into billions in debt in a few short weeks? Really?
People have interests and they follow strategies. Mostly, they just slosh about.
Choices are based ever and only on maximising rewards. Choices are based on the dispositions that people inherit from their history, and the opportunities and constraints of the field in which they operate.
People make decisions about how they should act by calmly comparing the costs and benefits of different courses of action. Right: like Britney Spears, Paris Hilton, Michael Jackson, David Hasselhoff, and the Yorkshire Ripper? You seriously want us to accept this proposition?
The existing economic and social system is at is. Our job is to describe and explain it. We make no judgement. We're just here to say how things work: slavery, child abuse, drug gangs, struggling householders ruined by in the subprime meltdown, whatever. There are some pretty horrible things about the current economic and social system. So horrible, we should try to change them. We don't like what we see. We're here to change things: slavery, child abuse, drug gangs, struggling householders ruined by in the subprime meltdown, whatever.
Three cheers for capitalism, which produces the best of all possible worlds. Two cheers for capitalism. It produces higher standards of living for many, but can often produce great misery.
The market rules, thank God! The less that governments interfere in markets, the better. The market rules, alas! Governments have a significant role to play in reducing the misery of the world.
Lower-class and poor people are so because they are stupid, lazy, uncompetitive and cannot calculate rationally; like the rubes who had to abandon their homes in the subprime mortgage crisis. They have what they deserve: poverty. Lower class people may find themselves trapped in their situation because they do not understand the covert ways that the upper-classes have of excluding newcomers.
Upper-class and successful people are so because their competitive smarts forced them to calculate better than poor people; like the bankers and brokers who sold subprime mortgages to the rubes. They have what they deserve: wealth and status. Upper-class people are so because they have constructed the entire social system to give them hidden advantages through their whole course of life. They find things happen smoothly, and that doors open magically to them at every turn. Because they are smarter? No. Because they come from the appropriate class background.
Rational Action Theorists on economics Bourdivins on sociology
Economists are the only social scientists who know what they are talking about. We use complex mathematics to accurately predict history. Look on my maths, ye mighty, and despair! You mean the same supa-dupa equations that were used by and destroyed most of the US banking sector? You mean that sort of maths?
Economists are the kings of the social sciences. We stride with pride the corridors of power. We change the course of history and the destiny of nations. We are the alpha-silverbacks of intellectuals, because we talk about the most important thing of all: money. When we beat our chests, presidents and prime ministers quail before us. Sociologists are the gnomes of the social sciences. We provide unpopular explanations for the bleeding obvious. When we beat our chests, we require immediate medical treatment for unintentional self-harm to our weedy frames.
Economists are objective. So what if we are well-off white professors in the American upper-class, with jobs guaranteed for years? How unbiased can you get, pleb? We can transcend the petty viewpoints of those we write about. Of course, most of us are well-to-do: because we are smarter, sharper, and better than the masses. Sociologists are embedded in the real world, with our own desires and expectations. We are human, after all. We struggle for symbolic and economic rewards, just like everyone else. This will affect what we say: we can never be objective. True, most of us are well-to-do, and that influences what we see and say.

1. Yes, we know that it is really the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.