Richard Feinberg Quoted on Discussion With John Williamson, PIIE Economist
The Cost of Theoclassical Economics and Economists
10/10/2011
William K. Black,
BenZINGa
Hernando de Soto is an extremely interesting Peruvian economist who is simultaneously deeply conservative and highly innovative. He published a column in the Washington Post on October 7, 2011 entitled “The Cost of Financial Ignorance” that caused me to reexamine “The Washington Consensus” [TWC].
I agree with de Soto, but his title would have been more accurate if it read: “The Costs of Theoclassical Economics and Economists.” The nature of the TWC is itself highly contested, so I will hold off providing “the” definition of TWC other than to warn that its originator and its proponents are engaged in historical revisionism to try to hide the damage TWC has done.
I agree with de Soto's criticisms of financial deregulation. Indeed, I will (briefly) add to those criticisms. But de Soto's argument that the deregulators violated TWC is not correct. Indeed, the opposite is true – TWC encouraged the disastrous deregulation. TWC had 10 points of supposed consensus. Three of them are of greatest relevance to de Soto's column and my response.
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Richard Feinberg can comment on U.S. foreign policy matters, notably with regard to Latin America and Asia, and business and economic matters.
