But when this comes from Tony Blair, or George Bush, or Nicolas Sarkozy, a surprising number of people, and an even more stunning portion of the pundit class seem to think that they have a point, and that we have to be 'reasonable', and that terrorism is a serious threat which requires that something be done.

This has been made possible because our leaders have hijacked two notions - that they are 'serious' about security, and that they are the good guys.

I won't write much about the first point - more than enough has been said about how the right in various countries, and the Republicans in particular in the USA, have managed to capture the value of patriotism by tainting their opponents, more or less openly, as traitors or criminal-lovers because they do not fall in line enthusiastically behind the proposals to use force and/or sanctions against Muslims, immigrants, drug use, or poor people. Understanding, compassion or solidarity (for Others) have been relentlessly labelled as evil.

I'd like instead to focus on the second point - the capture of the "good guy" label. It's never been hard, when in power (or out of it), to play the card of 'us' against 'them'. It's a natural consequence of using the patriotism card, and it plays on feelings we all have, to root for the home team, to think we are part of a community, and to associate with it, be proud of it, and generally try to see it in a good light when comparing to others.

What has changed in the past 30 years has been a new ingredient, brought to us by economists: the idea that our own selfishness is good for others, and thus that by taking care of us and of our own, we were actually also helping others. The notion that "greed is good" allows us to not only be selfish, but to actually feel good about it by considering that we're actually doing a service to others.

The right has become the party of unrestrained, unabashed, selfishness, and it has managed to convince enough people that it is nevertheless working for everybody in that way, and thus that it had no reason to be ashamed of its ugly arguments - and when the left criticizes the right for its selfishness, it responds by claiming that it is actually doing more for others, and thus that the right is where the "real" good guys are.

The responsibility for that state of mind can be set firmly at the feet of the economists, who have for the past 30 years and more propagated a vision of their discipline focused on justifying that convenient theory. Chistopher Hayes has a long article in the Nation about this, well worth reading, with such depressing and stunning paragraphs:

[David] Card, a highly esteemed economist at the University of California, Berkeley, caught flak for his heresy not on trade but on the minimum wage. In 1994 he conducted a study to see whether an increase in the minimum wage in New Jersey had the negative effect on employment that basic neoclassical theory would predict. He found it didn't. In fact, his regression analysis showed that, controlling for other factors, New Jersey gained fast-food jobs after increasing its minimum wage, compared with Pennsylvania, which hadn't raised wages. The paper attracted a tremendous amount of attention and criticism, and Card himself largely abandoned working on the minimum wage. In a 2006 interview, he explained his decision to leave the topic behind this way: "I've subsequently stayed away from the minimum wage literature for a number of reasons. First, it cost me a lot of friends. People that I had known for many years, for instance, some of the ones I met at my first job at the University of Chicago, became very angry or disappointed. They thought that in publishing our work we were being traitors to the cause of economics as a whole."

Showing that reality is not aligned with the grand theories of neolibs is akin to treason. And the heart of these theories, as Hayes explains in the following paragraph, is that everything can be explained by selfishness (sorry, "maximising utility"):

In their wake came a parade of libertarian economists, like Milton Friedman and his Chicago School colleagues, who pushed the neoclassical model to leave Keynes behind completely, to fully embrace the logical extremes of a world of self-interested rational actors--a back-to-the-future gambit dubbed the "new classical" economics.

In terms of the implications for the relative value of market and nonmarket forces in allocating resources, the new classical view didn't differ substantially from Adam Smith's original contention. In the same way classical economics was born as a brief for laissez-faire capitalism, against the prevailing interventionist mercantilism of the day, the new classical model reaffirmed the value of markets in the wake of Keynes's critiques.

And it came to dovetail quite neatly with a worldview that has dominated the past thirty years of globalization, which Notre Dame heterodox economist David Ruccio succinctly summed up to me as one in which "markets, private property and minimal government will achieve maximum welfare."

But the neoclassical model didn't leave its mark only on economics. In an audacious burst of methodological imperialism, Chicago Schoolers like Gary Becker used the framework of rational individuals seeking to maximize their utility to analyze and explain everything from tax evasion to teen pregnancy. This laid the groundwork for the public discourse we have today, in which Freakonomics spends 101 weeks on the bestseller list and policy-makers obsessively invoke "incentives" as the panacea for any given social problem. ("Incentive pay" for teachers! Give poor kids sneakers, and they'll be A students!) Indeed, the cradle for much of our policy discussions can be found in the first chapter of just about any introductory economics textbook, where the basic precepts of the neoclassical framework are described under the rubric of "thinking like an economist."

Thinking like an economist means considering not only that we are driven purely by selfishness (sorry, 'maximizing utility'), but that this is actually a good thing which has good results for others.

While it is of course true that most of us try to defend our personal interests, and will more or less regularly act out of selfishness, it is also a very real fact, noted by other economists (but who have more difficulty being accepted in the mainstream) that our behavior is also driven by social norms, irrationality and - gasp - strong preferences for fairness in outcomes above their absolute results.

But the dominant trend in economic theory is to ignore these inconvenient facts, and to focus exclusively on how to reduce taxes and get rid of gtovernment, because these are oppressive instruments that limit our right to be selfish and 'keep what's ours'.

And thus economists give weapons to politicians to claim, and give lazy pundits cover to mindlessly repeat, what thus becomes the common wisdom - an agenda pushed by the right, that they are more responsible, more "serious" and actually working for the little people.

After 30 years of repeating the same thing all over the (increasingly corporate-controlled) media, pretty much everybody will have more or less consciously absorbed the message that greed is good, that those that encourage greed are the good guys, and that what they do to allow you to continue being greedy is the right thing to do.

And thus we end up with the highly convenient appearance on the stage of the evil terrorists, who need to be fought be the 'good guys' in every possible way which is convenient for them, including vastly increased bureaucratic and police powers.

The article by Hayes, which is not about terrorism at all, ends on an upbeat note as he suggests that reality is slowly creeping upon the discipline of economics, and that the ideas of heterodox economists are slowly entering the mainstream. But it will take years, if not decades, for these ideas to become dominant (if they ever do), and to then influence politicians and pundits. The problem is that the policies that are being run in the meantime in the name of the greed of the good guys risk having irreversible effects. We've discussed peak oil, global warming, and resource depletion in the face of strong growth in emerging economies, but I actually worry more about what can happen on the political front. The cycle of reduced civil rights, less contestation, more violence can continue and accelerate (viciously) by feeding on itself, building on the self-righteousness of the politicians, the spoon-fed fear and ignorance in the populace and the residual notion that this is done for our own good.