Podcast Summary: Pitchfork Economics with Nick Hanauer

Episode: How Economists Cause Harm Even as They Aspire to Do Good (with George DeMartino)
Date: December 30, 2025
Guest: George DeMartino, Professor of Economics, University of Denver
Hosts: Paul and Goldie (Civic Ventures)

Episode Overview

This episode delves into the ethical shortcomings, professional overconfidence, and the very real harm caused by economists, even as they aim to improve society. Through a candid conversation with economist and author George DeMartino, the hosts explore why economics has resisted ethical scrutiny, how economic theories shape policies with immense and sometimes tragic consequences, and what a more responsible field could look like.

Key Discussion Points and Insights

1. Economist Skepticism and the Ethical Blind Spot

[03:33–06:38]

• George DeMartino opens with his decades-long quest: “I have spent the last 20, 25 years studying and writing about the ethical behavior of economists and their ethical responsibilities... In economics, we haven’t had even a five minute conversation about what it means to be a responsible economist and to face our ethical responsibilities.” (03:33)
• Goldie recalls how the Wharton School once faced uproar over requiring a single ethics class for business students: “It was inappropriate to teach economics and business students about ethics. It was a waste of time.” (04:30)
• The field’s allergy to ethics stems from its self-image as a neutral, “physics-like” science; ethics were seen as “muddying the waters.”

2. Positive vs. Normative Economics — What Should Be vs. What Is

[05:53–06:38]

• Positive economics: Objective, value-free description of the world.
• Normative economics: Prescribes what should be done; traditionally sidelined in favor of ‘positive’ objectivity.
• This split lets economists skirt ethical responsibility for the real-world effects of their advice.

3. Demographic Shifts and Persistent Problems

[06:38–08:42]

• Economics’ legacy: overwhelmingly white, male, affluent.
• But now “the demographics of the profession are changing dramatically,” with 70% of US economics PhD students coming from abroad, mainly Asia and South Asia.
• DeMartino sees hope: “It opens the door to economics, to whole parts of the globe that have been largely ignored... There’s at least a chance we might start to see much wider range of perspectives.” (07:51)

4. The Tragic Science — Unavoidable Harm

[08:42–11:49]

• DeMartino: Economics inevitably causes harm, even as it purports to do good.
  • “We’ve taught our students and the public for over a hundred years that in the aggregate, trade liberalization is great. Yes, there will be some harms, but those harms... are temporary, just like ripples on a pond. The problem is the harms aren't always like ripples on a pond. Instead, think of an avalanche.” (09:51)
  • Many economic “harms” (e.g., deindustrialization) have intergenerational, compounding effects—ignored by models focused on aggregate welfare.
  • Economists are “blase about the harms” because they expect them to dissipate quickly—a “professionally irresponsible” attitude.

5. Case Study: Russia’s Shock Therapy and Hubris

[11:49–14:10]

• In the 1990s, Western economists (notably Jeffrey Sachs) advocated for sudden, sweeping market reforms in Russia. The consequences were disastrous.
  • “The project was an enormous failure... estimates of extra deaths... range from something like 3 million to 10 million Russians who died in the wake of this shock therapy. They died... deaths of despair.” (12:34)
  • DeMartino’s indictment: Economists believed they “could control what happens in the world”—a fundamental, tragic overreach.

6. The Larry Summers Problem: Arrogance and Authority

[14:10–16:17]

• DeMartino coins the “Larry Summers problem”:
  • “It’s the mistake of thinking that because you’re the smartest person in the room... you’re then smart enough to know how to design the world. And you therefore think you’re warranted in using your authority to design economies...” (14:33)
  • Economics education reinforces a wizard-like authority: "We try to persuade them that our economic models are really time machines... Now this is insanity. In my humble opinion. This is professional malpractice." (15:11)

7. Prediction, Forecasting, and Professional Malpractice

[16:17–20:09]

• Goldie compares economists’ forecasting to meteorology: only economists' predictions change the very system they analyze.
  • DeMartino: “Economic forecasting, in my view, it represents professional malpractice... The world is far too complex for economists to understand and predict what will happen next.” (17:39)
  • Forecasts alter behavior, often unpredictably—thus, economists bear a unique responsibility for the harms wrought by misguided models.
  • The 2008 financial crisis is offered as an example: Economists’ faith in market efficiency contributed to a systemic blindness to bubbles.

8. Economists Don’t Trust Economics

[20:09–23:29]

• DeMartino reveals, from dozens of interviews, that practicing economists distrust their own forecasts and cost-benefit analyses:
  • "We know that these forecasts are incorrect, but this is what's asked of us... To which I say, if... decision makers are asking this of us, it's because we trained them... to expect this." (20:53)
  • Think-tank economists admit to exaggerating findings to “win battles” rather than reflect the truth.
  • Exception: Forensic economists (e.g., in the courtroom) take ethics seriously; most others do not.

9. Redesigning the Field: Ethics, Humility, Grounded Practice

[23:29–28:35]

• DeMartino’s “magic wand” for changing economics:
  • Begin economics education by openly discussing what economics doesn’t and cannot know.
  • Immerse PhD students in the communities they aim to serve—anthropological style.
  • Shift from forecasting and cost/benefit analysis to “decision making under deep uncertainty” (DMDU):
    • The goal isn’t optimal, “efficient” policies but robust ones, able to withstand unexpected changes and shocks.
    • Stakeholders should be actively and equitably engaged in policy formation.
  • "Pursuing optimality in a world of complex systems is far too dangerous and people suffer and die because of it." (25:43)

10. Utilitarianism and the Limits of Social Welfare

[27:10–28:35, 31:59–34:45]

• Orthodox economics' core is utilitarianism—maximizing aggregate social welfare measured in "utils."
  • Goldie: “That’s how you get a world... fundamental... Spock line, the greatest good for the greatest number.”
  • Problem: Ignores the persistent pain of “losers” even if the average goes up; imposes a false common metric.

11. Why This Work Matters

[28:35–29:50]

• DeMartino became an economist explicitly to challenge the profession from within:
  • “I became an economist in order to learn the logic by which economists could be making these arguments, and then to do everything I could... to alert the public to the fact that there's something fundamentally wrong, they're fundamentally dangerous...” (28:40)
  • He frames his work as a life-long effort to “nudge” the profession toward humility and genuine responsibility.

Notable Quotes & Memorable Moments

• “Trade liberalization is great. Yes, there will be some harms, but... these are the dislocated workers whose jobs are then offshored. Those harms will be temporary, just like ripples on a pond... The problem is that the harms aren’t always like ripples on a pond. Instead, think of an avalanche.”
  — George DeMartino (09:51)

• “Economic forecasting, in my view, represents professional malpractice... The social world comprises many, many diverse complex systems, none of which lend themselves to this kind of causal specification.”
  — George DeMartino (17:39)

• “Economists don’t believe economics... No economist is ever persuaded by the economic analysis of another economist.”
  — George DeMartino (21:15)

• On Russia’s shock therapy:
  "Estimates of extra deaths... range from something like 3 million to 10 million Russians who died in the wake of this shock therapy."
  — George DeMartino (12:34)

• “We try to persuade [students] that our economic models are really time machines... Now this is insanity. In my humble opinion. This is professional malpractice.”
  — George DeMartino (15:11)

• "What we need to do instead is accept the unknowability of the future and pursue robust policies... that engage stakeholders directly in policy formation... We have such a paternalistic ethic in economics that says, 'we know best.'”
  — George DeMartino (25:43, 26:43)

• “If you want to worry about improving the lives of people, then their judgment of their own lives matters as opposed to some calculus.”
  — Paul (34:36)

Timestamps for Major Segments

• 03:33 — George DiMartino’s introduction & focus on professional ethics
• 05:53 — Explanation of positive vs. normative economics
• 07:06 — Demographic makeup and its impact
• 09:09 — The meaning of “tragic” in the Tragic Science
• 11:49 — Case Study: Russia’s shock therapy
• 14:33 — The “Larry Summers problem”: Over-confidence and authority in economics
• 17:39 — The dangers and fallacies of economic forecasting
• 20:09 — Practicing economists’ skepticism about their own field
• 23:54 — DeMartino’s prescription for a more ethical economics
• 28:40 — Why DeMartino does this work
• 31:59 — Goldie and Paul reflect on utilitarianism and harm in economics
• 34:45 — Paul and Goldie discuss skepticism and humility in policy advocacy

Flow and Takeaways

The discussion traces the evolution (or lack thereof) of economic ethics, revealing deep flaws in both how the field is taught and how it is practiced. DeMartino challenges the myth of economic objectivity and the misplaced confidence of experts who believe they can engineer societies from afar. The episode underscores that not only do economists often fail to predict or control economies, but their advice can—and has—led to massive, long-term harm, with little acknowledgment or accountability.

By advocating for robust, participatory, and humble economics—rooted in real communities and open about uncertainty—DeMartino sketches a vision of what the field could become if it faced its own limitations honestly. As the hosts point out, this means finally centering the lived experiences and values of people, not just theoretical social welfare.

Recommended Action for Listeners
Read George DeMartino’s book, The Tragic Science: How Economists Cause Harm Even as They Aspire to Do Good, for a deeper analysis. (Link in show notes.)