Washington Babylon — September 9, 2009, 11:12 am

How the Fed Buys Top Economists (and Journalists)

From Huffington Post:

The Federal Reserve, through its extensive network of consultants, visiting scholars, alumni and staff economists, so thoroughly dominates the field of economics that real criticism of the central bank has become a career liability for members of the profession, an investigation by the Huffington Post has found.

This dominance helps explain how, even after the Fed failed to foresee the greatest economic collapse since the Great Depression, the central bank has largely escaped criticism from academic economists. In the Fed’s thrall, the economists missed it, too.

“The Fed has a lock on the economics world,” says Joshua Rosner, a Wall Street analyst who correctly called the meltdown. “There is no room for other views, which I guess is why economists got it so wrong.”

One critical way the Fed exerts control on academic economists is through its relationships with the field’s gatekeepers. For instance, at the Journal of Monetary Economics, a must-publish venue for rising economists, more than half of the editorial board members are currently on the Fed payroll — and the rest have been in the past.

Of course, the Fed offers lots of perks to friendly journalists too. For years, the Fed invited favored reporters to watch the 4th of July fireworks from the Fed’s roof, and journalists love to attend the Fed’s annual economics retreat at Jackson Hole, Wyoming. Here’s how Bob Woodward described the retreat in Maestro, his fawning profile of Alan Greenspan:

Held at the foot of the Grand Teton Mountains, the conference offered much needed relief from Washington, D.C.’s August swamp weather. Central bankers from around the world, in addition to academic economists, policy makers and journalists, attended seminars in the morning and then enjoyed outdoor activities in the afternoon.

Between three square meals a day and ample time at the bar.

Share
Single Page

More from Ken Silverstein:

Commentary November 17, 2015, 6:41 pm

Shaky Foundations

The Clintons’ so-called charitable enterprise has served as a vehicle to launder money and to enrich family friends.

From the November 2013 issue

Dirty South

The foul legacy of Louisiana oil

Perspective October 23, 2013, 8:00 am

On Brining and Dining

How pro-oil Louisiana politicians have shaped American environmental policy

Get access to 165 years of
Harper’s for only $45.99

United States Canada

CATEGORIES

THE CURRENT ISSUE

April 2017

You Can Run …

= Subscribers only.
Sign in here.
Subscribe here.

Never Would I Ever

= Subscribers only.
Sign in here.
Subscribe here.

The March on Everywhere

= Subscribers only.
Sign in here.
Subscribe here.

Defender of the Community

= Subscribers only.
Sign in here.
Subscribe here.

Echt Deutsch

= Subscribers only.
Sign in here.
Subscribe here.

The Boy Without a Country

= Subscribers only.
Sign in here.
Subscribe here.

view Table Content

FEATURED ON HARPERS.ORG

Article
The March on Everywhere·

= Subscribers only.
Sign in here.
Subscribe here.

Photograph (detail) © Nima Taradji/Polaris
Post
The Forty-Fifth President·

= Subscribers only.
Sign in here.
Subscribe here.

Photograph (detail) by Philip Montgomery
Article
Defender of the Community·

= Subscribers only.
Sign in here.
Subscribe here.

Illustration (detail) by Katherine Streeter
Article
The Boy Without a Country·

= Subscribers only.
Sign in here.
Subscribe here.

Illustration (detail) by Shonagh Rae
Article
Asphalt Gardens·

= Subscribers only.
Sign in here.
Subscribe here.

In a city that is rapidly pricing out the poor, NYCHA’s housing projects are a last bastion of affordable shelter, with an average monthly rent of $509
Photograph (detail) © Samuel James

Number of mine-detecting monkeys erroneously reported to have been given to the United States by Morocco in March:

2,000

The Pacific trade winds are weakening as a result of global warming.

In the United States, legislation to repeal the Affordable Care Act was advanced by the House Ways and Means Committee after 18 hours of deliberation, during which time the Republican members of Congress passed around candy.

Subscribe to the Weekly Review newsletter. Don’t worry, we won’t sell your email address!

HARPER’S FINEST

Who Goes Nazi?

= Subscribers only.
Sign in here.
Subscribe here.

By

"It is an interesting and somewhat macabre parlor game to play at a large gathering of one’s acquaintances: to speculate who in a showdown would go Nazi. By now, I think I know. I have gone through the experience many times—in Germany, in Austria, and in France. I have come to know the types: the born Nazis, the Nazis whom democracy itself has created, the certain-to-be fellow-travelers. And I also know those who never, under any conceivable circumstances, would become Nazis."

Subscribe Today