In its September Communique, the UN’s Intergovernmental Group of Twenty-Four on International Monetary Affairs and Development referred to a “crisis of confidence in advanced economies”. In other words, there is a crisis of confidence in capitalism as a system. We have been witnessing a series of crises in recent years: the financial crisis, debt crisis, commodity crisis, etc. In the meantime, unemployment and growing inequality, particularly in the USA, has led to the 99% movement, “Occupy Wall Street” and upheavals in other countries unprecedented since the Civil Rights Movement.
What has received less attention is the upheaval by economics students at Harvard University. They walked out of a “Principles of Economics” class objecting to the way economics was taught and protesting the “corporatization of higher education”. Their main point was that “the biased nature of Economics 101 [basic economics course] contributes to and symbolizes the increasing economic inequality in America..” and that “Harvard graduates play major roles in financial institutions and in shaping policy around the world”. In other words, they implied that the crisis in capitalism and growing inequality in wealth and income is not only due to the way financial institutions (and the Wall Street) operate, but is also to a large extent, rooted in the way economics is taught.