Clare Lombardelli is right about the problems of economics teaching (‘It’s pretty bad’: Bank of England top official on the lack of female economics students, 5 May), and it’s illustrated right there in her article – the idea that a quarter-point cut in the Bank of England base rate is going to make much difference in the present volatile Trumpist world.
The obsession with interest rates by financial and economics wonks has always been a wonder to behold. Acres of newsprint are expended on it. But it was the great JK Galbraith who put it into perspective when he said that people, companies and banks will spend, borrow or lend when they feel confident to do so, and not because of where the interest rate is at any given moment.
Proof of this came when the Bank had the rate down at a historic low of 0.5% for a decade under David Cameron and George Osborne, yet the economy resolutely refused to properly recover and bumped stubbornly along on the bottom. This was because politicians’ fiscal austerity policies had sucked out confidence and demand.
Lombardelli is certainly right when she says that students should be given the wider social perspective. Trumpism is one thing, but for years the persistent problems have been the cost of housing and poorly paid, insecure jobs. Rectify these and you will see a genuine recovery that owes little to minor tweaks in the interest rate. And hopefully a new bunch of students who will see the benefits personally.
David Redshaw
Saltdean, East Sussex
• More teaching of economics to a broader range of students would of course be a good thing. But the real question is whose economics is being taught? I took A-level economics in a state school and part-one economics at Cambridge. It was all about the joy and the magic of markets, a decade before Margaret Thatcher. It felt like a gigantic con at the time, and we now know where that got us.
Clare Lombardelli is right that economics is “the best subject to understand social issues, why things are the way they are”. But can it answer the question: what, or better still, who is an economy for? Answer that one way and you get neoliberalism, answer it another and you’ve a fighting chance of a more equal, just and sustainable world.
Andrew Webb
London
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