It’s called political economy because it is has nothing to do with either politics or economy.

Leacock’s quip satirizes academic jargon and the perceived remoteness of economic theory from real life. By claiming “political economy” has nothing to do with either politics or the economy, he highlights a mismatch between a discipline’s name and what it actually delivers to ordinary understanding—suggesting abstraction, pedantry, or self-contained theorizing. The joke also plays on the expectation that a field’s title should transparently describe its subject matter; when it doesn’t, the result is comic and faintly accusatory. More broadly, the line fits Leacock’s recurring target: institutions (universities, experts, public discourse) that cloak confusion or impracticality in impressive terminology.