Economics is not nearly spreadsheets. It is about individuals, energy, and place.

On this video, filmed in Ely, the place I dwell, I discover what my good friend Danny Blanchflower calls ‘the economics of strolling about’, which is the concept you be taught extra about the true financial system by strolling by way of it than by watching information. From Ely Cathedral to Oliver Cromwell’s home, this can be a story about how energy shapes the whole lot — from feudal rents to fashionable mortgages.

(And we all know the video is not excellent, however we’ll get higher at this).

That is the audio model:

That is the transcript:

For the primary time, I am making a video for this channel the place I am effectively out of my consolation zone. In different phrases, I am  not sitting in my workplace in entrance of our regular digital camera. I am out and about. I’ve obtained a type of motion cameras in entrance of me, and as you may see, I am standing within the open on what is named Cathedral Inexperienced in Ely in Cambridgeshire, the place I dwell.

And I am not right here for any random motive. I am right here as a result of strolling about is a part of political financial system. My good friend Danny Blanchflower, who was as soon as a member of the Financial institution of England‘s Financial Coverage Committee and is a professor of economics at Dartmouth School within the USA, created this time period ‘The economics of strolling about.’

And he did it partly to speak about the truth that in the event you really relate to strange individuals and ask them what they consider the financial system, they’re almost definitely to have a greater view of what’s actually happening than skilled economists who keep inside their places of work and take a look at spreadsheets and information and fake that formulation signify the true world when individuals know they do not.

However there’s one other dimension to the economics of strolling about, and that is this one, which is just understanding economics in the true world as you journey by way of it. And so I am standing right here in entrance of Ely Cathedral. There is a deliberate motive for doing so. Ely Cathedral is, in fact, a logo of energy. And the entire of political financial system is all in regards to the relationships of energy throughout the financial system and the way they have an effect on the allocation of sources inside it.

It wasn’t an accident that when the Normans arrived on this metropolis in 1066 or very quickly thereafter, they started to construct this edifice proper in entrance of me in the meanwhile. They did not end it for fairly some time afterwards, and actually, some elements fell down. You may see that there is one wing lacking, and, in actual fact, behind the tower, you may see there’s one other one, which changed a center tower, which in flip fell down in 1322.

However the level is, this has been right here as a logo of the ability of the church and in flip, in fact, the Norman authorities, and so the crown within the UK – the institution, in the event you like – ever since.

And there was in actual fact a cathedral earlier than this one. The cathedral in Ely was established someday within the seventh or eighth century, and so they knocked the outdated one all the way down to construct this one. Once more, a logo of energy; one thing that we’re seeing taking place proper now within the USA, the place Trump is pulling down a part of the White Home to make a brand new image of his personal energy. Structure has all the time been about energy.

And simply look to the appropriate of me, and there we’ve the outdated Bishop’s palace. The bishops lived in fashion in Ely. They mainly dominated East Anglia from Ely of their day. And it wasn’t an opportunity that they constructed themselves an unlimited palace to have fun that from, as a result of they had been extremely rich individuals, mainly aristocrats who had been given a title as a bishop as a substitute of as a lord or no matter. And from there, they collected the rents that had been as a result of church.

This isn’t only a place of worship. Let’s not fake that it’s. It’s a image of a rentier financial system, a feudal financial system, an financial system that existed by extracting cost from the individuals of this metropolis and an enormous space round it. And that’s essential as a result of quietly, that financial system nonetheless exists.

Ely now exists as a spot the place giant numbers of individuals dwell in what’s now a dormitory city servicing Cambridge. And I think a really giant variety of the individuals right here have mortgages, and they’re paying their very own type of hire. Both they’re renting a property or, on that mortgage, they’re paying curiosity. And in both case, they’re nonetheless making funds to the elite for the appropriate to dwell on this place that they name house. That’s political financial system in motion.

And now, if I flip round, we are able to see one other image of energy. And let me simply stroll in direction of it as a result of this can be a cannon from the Crimean Conflict. It has been sitting right here on Cathedral Inexperienced for so long as I can bear in mind, and apparently, it was by no means fired in anger. I feel it was a Russian cannon, and it was captured by the forces within the Crimean Conflict, but it surely’s right here to symbolise one thing which is so closely related to that cathedral behind me.

Within the cathedral, one can find the flags of regiments and RAF squadrons and all kinds of issues. The affiliation between the church and the armed forces may be very robust. The hospital on this city is named the Princess of Wales Hospital, but it surely was previously the RAF hospital. That is how essential the hyperlink is. We did not have our personal hospital. We needed to depend on a pressure’s one, and that’s nonetheless remembered in the way in which wherein it’s structured.

So, there may be energy throughout us. And now I will go on one other stroll, and this stroll goes to take us slightly additional, so you will be a part of me once more in a second.

And so now I’ve walked slightly additional, not very a lot additional. The cathedral stays simply over there, however I am now taking a look at what seems to be a Tudor home. It is not. That is a synthetic frontage placed on an older home round 1900, and it’s Oliver Cromwell’s home, proper right here in the course of Ely. Cromwell lived in Ely. He was the MP for Huntington. He was an East Anglian, and this was his house. And from right here, he undoubtedly helped plot the demise of King Charles I.

That is energy. That is actual energy. That is another energy. Now, I am not an entire fan of Oliver Cromwell. Anyone who is aware of what he did in Eire and who has an Irish identify shouldn’t be an entire fan of Cromwell as a result of what he did there was horrible, and you could possibly argue that what he did in England was horrible as effectively, as a result of he did not ship democracy. However he did problem energy. And that is the significance, and that is why I am standing in entrance of this home. What it reveals is that energy in the end lay with individuals.

For all of the grand edifice of the cathedral, Cromwell shut it down. For all the ability that the elite had at the moment, he put in place another. It’s an possibility.

Energy shouldn’t be absolute. Energy is all the time dependent upon consent, and we’ve to know that in political financial system as effectively. Strolling round and simply taking a look at these relationships is sort of extraordinary.

Now, the place you reside, there may not be fairly as marked distinction in energy as there may be between the cathedral, and its efficient institution of royalty on this place, and the ability of the elite on this place, and the distinction with Oliver Cromwell and what he did. However there shall be different symbols of the identical kind of factor, and that is what issues.

If we glance round us, if we perceive what the political financial system is doing round us, we start to see the probabilities. Cromwell confirmed a risk, a risk that the order because it was may very well be modified. And to me, that issues. If we perceive that, we would realise {that a} totally different world is feasible, and that’s what political financial system is all about, so far as I am involved.

Strolling about is a robust instrument in my understanding of simply what I wish to obtain by enterprise this exercise, which I name political financial system.

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