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Slightly Skeptical View on Neoliberal Transformation of University Education

News Neoliberalism and rising inequality Recommended Links Neoliberalism as a New Form of Corporatism Neoliberal Brainwashing -- Journalism in the Service of the Powerful Few The value of education
Groupthink Obscurantism Multiple Choice Test Taking Strategies Cheating as a reaction to college application stress Toxic managers and coworkers Health Issues
Unemployment after graduation Problems of CS Education Science, Pseudoscience and Society Neoclassical Pseudo Theories and Crooked and Bought Economists as Fifth Column of Financial Oligarchy Lysenkoism Numbers racket and "Potemkin numbers"
SAT   Diploma Mills Certification Information Technology Wonderland How to Solve It by George Polya
Education Quotes Benjamin Franklin Quotes Einstein Quotes John Kenneth Galbraith Quotes Social Problems of Education Harvard Mafia, Andrei Shleifer and the economic rape of Russia
Elite [Dominance] Theory And the Revolt of the Elite The Iron Law of Oligarchy Softpanorama Bookshelf Classic Books Softpanorama Bookshelf / Algorithms Best Old TCP/IP Books
Best Red Hat Books for Preparation to Certification Compiler Construction Best C language textbooks Softpanorama bookshelf / C++ books Best Pascal Programming Books Best Perl Books for System Administrators
Information overload Mental Overload Sleep Deprivation Drinking from a firehose Humor Etc


Introduction

Previously education was mostly about "finding yourself" -- developing understanding of the world and yourself, as well as developing those set of abilities that you was gifted most. Andinding what you what to do in the future, Neoliberalism has changed that dramatically. Education now is just in "investment" into your "entrepreneurial self" to increase your value as "human capital" holder and this your value in the "labout market." (Symptomatic Redness -Philip Mirowski - YouTube).  That's bullsh*t, but people already brainwashed by neoliberals from the middle school buy it uncritically.

In the current circumstances education is no longer the answer to rising inequality. Instead of serving as a social lift it, at least in some cases, became more of a social trap. This is connected with neoliberal transformation of education. With the collapse of post-war public funded educational model and privatization of the University education students face a pretty cruel world. World in which they are cows to milk. Now universities became institutions very similar to McDonalds ( or, in less politically correct terms, Bordellos of Higher Learning). Like McDonalds they need to price their services so that to receive nice profit and they to make themselves more attractive to industry they intentionally feed students with overspecialized curriculum instead of concentrating on fundamentals and the developing the ability to understand the world. Which was a hallmark of university education of the past.

Since 1970th Neo-Liberal University model replaced public funded university model (Dewey model). It is now collapsing as there are not that many students, who are able (and now with lower job prospects and persistent tales of graduates working as bartenders) to pay inflated tuition fees. That means that higher education again by-and-large became privilege of the rich and upper middle class.

Lower student enrollment first hit minted during dot-com boom expensive private colleges, who hunt for people with government support (such a former members of Arm forces). It remains viable only in elite universities, which traditionally serve the top 1% and rich foreigners. As David Schultz wrote in his article (Logos, 2012):

Yet the Dewey model began to collapse in middle of the 1970s. Perhaps it was the retrenchment of the SUNY and CUNY systems in New York under Governor Hugh Carey in 1976 that began the end of the democratic university. What caused its retrenchment was the fiscal crisis of the 1970s.

The fiscal crisis of the 1970s was born of numerous problems. Inflationary pressures caused by Vietnam and the energy embargoes of the 1970s, and recessionary forces from relative declines in American economic productivity produced significant economic shocks, including to the public sector where many state and local governments edged toward bankruptcy.

Efforts to relieve declining corporate profits and productivity initiated efforts to restructure the economy, including cutting back on government services. The response, first in England under Margaret Thatcher and then in the United States under Ronald Reagan, was an effort to retrench the state by a package that included decreases in government expenditures for social welfare programs, cutbacks on business regulations, resistance to labor rights, and tax cuts. Collectively these proposals are referred to as Neo-liberalism and their aim was to restore profitability and autonomy to free markets with the belief that unfettered by the government that would restore productivity.

Neo-liberalism had a major impact on higher education. First beginning under President Carter and then more so under Ronald Reagan, the federal and state governments cut taxes and public expenditures. The combination of the two meant a halt to the Dewey business model as support for public institutions decreased and federal money dried up.

From a high in the 1960s and early 70s when states and the federal government provided generous funding to expand their public systems to educate the Baby Boomers, state universities now receive only a small percentage of their money from the government. As I pointed out in my 2005 Logos “The Corporate University in American Society” article in 1991, 74% of the funding for public universities came from states, in 2004; it was down to 64%, with state systems in Illinois, Michigan and Virginia down to 25%, 18%, and 8% respectively. Since then, the percentages have shrunk even more, rendering state universities public institutions more in name than in funding.

Higher education under Neo-liberalism needed a new business model and it found it in the corporate university. The corporate university is one where colleges increasingly use corporate structures and management styles to run the university. This includes abandoning the American Association of University Professors (AAUP) shared governance model where faculty had an equal voice in the running of the school, including over curriculum, selection of department chairs, deans, and presidents, and determination of many of the other policies affecting the academy. The corporate university replaced the shared governance model with one more typical of a business corporation.

For the corporate university, many decisions, including increasingly those affecting curriculum, are determined by a top-down pyramid style of authority. University administration often composed not of typical academics but those with business or corporate backgrounds had pre-empted many of the decisions faculty used to make. Under a corporate model, the trustees, increasingly composed of more business leaders than before, select, often with minimal input from the faculty, the president who, in turn, again with minimal or no faculty voice, select the deans, department heads, and other administrative personnel.

In some disciplines such as economics University presidents became way too greedy

Neoliberalism professes the idea the personal greed can serve positive society goals, which is reflected in famous neoliberal slogan "greed is good". And university presidents listen. Now presidents of neoliberal universities do not want to get $100K per year salary, they want one, or better several, million dollar salary of the CEO of major corporation (Student Debt Grows Faster at Universities With Highest-Paid Leaders, Study Finds - NYTimes.com)

At the 25 public universities with the highest-paid presidents, both student debt and the use of part-time adjunct faculty grew far faster than at the average state university from 2005 to 2012, according to a new study by the Institute for Policy Studies, a left-leaning Washington research group.

The study, “The One Percent at State U: How University Presidents Profit from Rising Student Debt and Low-Wage Faculty Labor,” examined the relationship between executive pay, student debt and low-wage faculty labor at the 25 top-paying public universities.

The co-authors, Andrew Erwin and Marjorie Wood, found that administrative expenditures at the highest-paying universities outpaced spending on scholarships by more than two to one. And while adjunct faculty members became more numerous at the 25 universities, the share of permanent faculty declined drastically.

“The high executive pay obviously isn’t the direct cause of higher student debt, or cuts in labor spending,” Ms. Wood said. “But if you think about it in terms of the allocation of resources, it does seem to be the tip of a very large iceberg, with universities that have top-heavy executive spending also having more adjuncts, more tuition increases and more administrative spending.”

... ... ...

The Chronicle of Higher Education’s annual survey of public university presidents’ compensation, also released Sunday, found that nine chief executives earned more than $1 million in total compensation in 2012-13, up from four the previous year, and three in 2010-11. The median total compensation of the 256 presidents in the survey was $478,896, a 5 percent increase over the previous year.

... ... ...

As in several past years, the highest-compensated president, at $6,057,615 in this period, was E. Gordon Gee, who resigned from Ohio State last summer amid trustee complaints about frequent gaffes. He has since become the president of West Virginia University.

This trick requires dramatic raising of tuition costs. University bureaucracy also got taste for better salaries and all those deans, etc want to be remunerated like vice presidents. So raising the tuition costs became the key existential idea of neoliberal university. Not quality of education, but tuition costs now are the key criteria of success. And if you can charge students $40K per semester it is very, very good. If does not matter that most population get less then $20 an hour.

The same is true for professors, who proved to be no less corruptible. And some of them, such as economic departments, simply serve as prostitutes for financial oligarchy. So they were corrupted even before that rat race for profit. Of course there are exceptions. But they only prove the rule.

As the result university tuition inflation outpaced inflation by leaps and bounds. At some point amount that you pay (and the level of debt after graduation) becomes an important factor in choosing the university. So children of "have" and "have nots" get into different educational institutions and do not meet each other. In a way aristocracy returned via back door.

Job market situation and hidden financial rip offs

Neoliberal university professes "deep specialization" to create "ready for the market" graduates. And that creates another problem: education became more like stock market game and that makes more difficult for you to change you specialization late in the education cycle. But early choice entail typical stock market problem: you might miss the peak of the market or worse get into prolonged slump as graduates in finance learned all too well in 2008. That's why it is important not to accumulate too much debt: this is a kind of "all in" play in poker. You essentially bet that in a particular specialty there will be open positions with high salary, when you graduate. If you lose this bet you are done.

As a result of this "reaction to the market trends" by neoliberal universities, when universities bacem appendixes of HR of large corporations students need to be more aware of real university machinery then students in 50th or 60th of the last century. And first of all assume that it is functioning not to their benefits.

One problem for a student is that there are now way too many variables that you do not control. Among them:

On the deep level neoliberal university is not interested to help you to find specialization and place in life where can unleash your talents. You are just a paying customers much like in McDonalds, and university interests are such they might try to push you in wrong direction or load you with too much debt.

If there is deep mismatch as was with computer science graduates after crash of dot-com boom, or simply bad job market due to economy stagnation and you can't find the job for your new specialty (or if you got "junk" specialty with inherent high level of unemployment among professionals) and you have substantial education debt, then waiting tables or having some other MacJob is a real disaster for you. As with such salaries you simply can't pay it back. So controlling the level of debt is very important and in this sense parents financial help is now necessary. In other words education became more and more "rich kids game".

That does not mean that university education should be avoided for those from families with modest means. On the contrary it provides unique experience and help a person to mature in multiple ways difficult to achieve without it. It is still one of the best ways to get vertical mobility. But unless parents can support you need to try to find the most economical way to obtain it without acquiring too much debt. This is you first university exam. And if you fail it you are in trouble.

For example, computer science education is a great way to learn quite a few things necessary for a modern life. But the price does matter and prestige of the university institution that you attend is just one of the factors you should consider in your evaluation. It should not be the major factor ("vanity fair") unless your parents are rich and can support you. If you are good you can get later a master degree in a prestigious university after graduation from a regular college. Or even Ph.D.

County colleges are greatly underappreciated and generally provide pretty high standard of education, giving ability to students to save money for the first two years before transferring to a four year college. They also smooth the transition as finding yourself among people who are only equal or superior then you (and have access to financial resource that you don't have) is a huge stress. The proverb say that it is better to be first in the village then last in the town has some truth in it. Prestigious universities might provide a career boost (high fly companies usually accept resumes only from Ivy League members), but they cost so much that you need to be a son or daughter of well-to-do parents to feel comfortably in them. Or extremely talented. Also amount of career boost that elite universities provide depends on whom your parents are and what connections they have. It does not depend solely on you and the university. Again, I would like to stress that you should resist "vanity fair" approach to your education: a much better way is to try to obtain BS in a regular university and them try to obtain MS and then, if you are good, PHD, in a prestigious university. Here is a fragment of an interesting discussion that covers this topic (Low Mobility Is Not a Social Tragedy?, Feb 13, 2013 ; I recommend you to read the whole discussion ):

kievite:

I would like to defend Greg Clack.

I think that Greg Clack point is that the number of gifted children is limited and that exceptionally gifted children have some chance for upper move in almost all, even the most hierarchical societies (story of Alexander Hamilton was really fascinating for me, the story of Mikhail Lomonosov http://en.wikipedia.org/wiki/Mikhail_Lomonosov was another one -- he went from the very bottom to the top of Russian aristocracy just on the strength of his abilities as a scientist). In no way the ability to "hold its own" (typical for rich families kids) against which many here expressed some resentment represents social mobility. But the number of kids who went down is low -- that's actually proves Greg Clack point:

(1) Studies of social mobility using surnames suggest two things. Social mobility rates are much lower than conventionally estimated. And social mobility rates estimated in this way vary little across societies and time periods. Sweden is no more mobile than contemporary England and the USA, or even than medieval England. Social mobility rates seem to be independent of social institutions (see the other studies on China, India, Japan and the USA now linked here).

Francisco Ferreira rejects this interpretation, and restates the idea that there is a strong link between social mobility rates and inequality in his interesting post.

What is wrong with the data Ferreira cites? Conventional estimates of social mobility, which look at just single aspects of social status such as income, are contaminated by noise. If we measure mobility on one aspect of status such as income, it will seem rapid.

But this is because income is a very noisy measure of the underlying status of families. The status of families is a combination of their education, occupation, income, wealth, health, and residence. They will often trade off income for some other aspect of status such as occupation. A child can be as socially successful as a low paid philosophy professor as a high paid car salesman. Thus if we measure just one aspect of status such as income we are going to confuse the random fluctuations of income across generations, influenced by such things as career choices between business and philosophy, with true generalised social mobility.

If these estimates of social mobility were anywhere near correct as indicating true underlying rates of social mobility, then we would not find that the aristocrats of 1700 in Sweden are still overrepresented in all elite occupations of Sweden. Further, the more equal is income in a society, the less signal will income give of the true social status of families. In a society such as Sweden, where the difference in income between bus drivers and philosophy professors is modest, income tells us little about the social status of families. It is contaminated much more by random noise. Thus it will appear if we measure social status just by income that mobility is much greater in Sweden than in the USA, because in the USA income is a much better indicator of the true overall status of families.

The last two paragraphs of Greg Clark article cited by Mark Thoma are badly written and actually are somewhat disconnected with his line of thinking as I understand it as well as with the general line of argumentation of the paper.

Again, I would like to stress that a low intergenerational mobility includes the ability of kids with silver spoon in their mouth to keep a status close to their parent. The fact that they a have different starting point then kids from lower strata of society does not change that.

I think that the key argument that needs testing is that the number of challengers from lower strata of the society is always pretty low and is to a large extent accommodated by the societies we know (of course some societies are better then others).

Actually it would be interesting to look at the social mobility data of the USSR from this point of view.

But in no way, say, Mark Thoma was a regular kid, although circumstances for vertical mobility at this time were definitely better then now. He did possessed some qualities which made possible his upward move although his choice of economics was probably a mistake ;-).

Whether those qualities were enough in more restrictive environments we simply don't know, but circumstances for him were difficult enough as they were.

EC -> kievite...

"the number of gifted children is limited"

I stopped reading after that. I teach at a high school in a town with a real mix of highly elite families, working class families, and poor families, and I can tell you that the children of affluent parents are not obviously more gifted than the children of poor families. They do, however, have a lot more social capital, and they have vastly more success. But the limitations on being "gifted" are irrelevant.

According to an extensive study (Turkheimer et al., 2003) of 50,000 pregnant women and the children they went on to have (including enough sets of twins to be able to study the role of innate genetic differences), variation in IQ among the affluent seems to be largely genetic.

Among the poor, however, IQ has very little to do with genes -- probably because the genetic differences are swamped and suppressed by the environmental differences, as few poor kids are able to develop as fully as they would in less constrained circumstances.

kievite -> EC...

All you said is true. I completely agree that "...few poor kids are able to develop as fully as they would in less constrained circumstances." So there are losses here and we should openly talk about them.

Also it goes without saying that social capital is extremely important for a child. That's why downward mobility of children from upper classes is suppressed, despite the fact that some of them are plain vanilla stupid.

But how this disproves the point made that "exceptionally gifted children have some chance for upper move in almost all, even the most hierarchical societies"? I think you just jumped the gun...

mrrunangun:

The early boomers benefitted from the happy confluence of the postwar boom, LBJ's Great Society efforts toward financial assistance for those seeking to advance their educations, and the 1964 Civil Rights Act which opened opportunities for marginalized social groups in institutions largely closed to them under the prewar social customs in the US.

The US Supreme Court is made up of only Jews and Catholics as of this writing, a circumstance inconceivable in the prewar America. Catholics were largely relegated to separate and unequal institutions. Jews' opportunities were limited by quotas and had a separate set of institutions of their own where their numbers could support such. Where their numbers were not sufficient, they were often relegated to second rate institutions.

Jewish doctors frequently became the leading men in the Catholic hospitals in Midwestern industrial towns where they were unwelcome in the towns' main hospitals. Schools, clubs, hospitals, professional and commercial organizations often had quota or exclusionary policies. Meritocracy has its drawbacks, but we've seen worse in living memory.

The cruel world of neoliberal university

Of course bad things that happened to you during your university years are soon forgotten and nostalgia colors everything in role tones, but the truth is that the modern university is a very cruel world. Now more then ever. Here are some random observations of the subject (See also my Diploma Mills page about high education sharks for which sucking you dry financially is the main goal ):

Lysenkoism and petty, greedy pseudo-scientific scum as professors and teachers

Most teachers and Professors in the university are good, honest people who are trying to make some contribution to science and teach students (difficult things to mix). But not all. One of the most dangerous feature of neoliberal university are influx of people who represent a toxic mix of teacher, snake oil seller, careerist and cult follower. They are not teachers but brainwashers, hired guns -- propagandists masquerading as University professors. That is why we have witnessed such a corruption and politicization of science and rising proportion of research and theories taught at the universities that are fraudulent.

Previously teacher was a person somewhat similar to a monk. A person who consciously traded the ability to work in science to the possibility of acquiring material wealth, at least excessive material wealth. As Ernest Rutherford once reminded Pyotr Kapitsa "No one can serve two masters. Either you will hate the one and love the other, or you will be devoted to the one and despise the other. You cannot serve both God and money." (Matthew 6:24)

But in neoliberal university way too many teachers/researchers took Faustian bargain when one trades the academic independence for above average personal wealth, influence, for the power grab. And despite popular image of scientists and university professors they proved to be as corruptible by money as Wall Street traders ;-). This is because the sponsors of their research such as big business, non-governmental organizations (NGO) and government vie to publish reports and results that put the sponsors in the best light. Good example is relations of pharmaceutical industry and academia

“The answer to that question is at once both predictable and shocking: For the past two decades, medical research has been quietly corrupted by cash from private industry. Most doctors and academic researchers aren't corrupt in the sense of intending to defraud the public or harm patients, but rather, more insidiously, guilty of allowing the pharmaceutical and biotech industries to manipulate medical science through financial relationships, in effect tainting the system that is supposed to further the understanding of disease and protect patients from ineffective or dangerous drugs. More than 60 percent of clinical studies--those involving human subjects--are now funded not by the federal government, but by the pharmaceutical and biotech industries. That means that the studies published in scientific journals like Nature and The New England Journal of Medicine--those critical reference points for thousands of clinicians deciding what drugs to prescribe patients, as well as for individuals trying to educate themselves about conditions and science reporters from the popular media who will publicize the findings--are increasingly likely to be designed, controlled, and sometimes even ghost-written by marketing departments, rather than academic scientists. Companies routinely delay or prevent the publication of data that show their drugs are ineffective.

...

“ Novartis, stepped in and provided additional funding for development. In 1984, private companies contributed a mere $26 million to university research budgets. By 2000, they were ponying up $2.3 billion, an increase of 9000 percent that provided much needed funds to universities at a time when the cost of doing medical research was skyrocketing.”

Historically the scientific community is held together through its joint acceptance of the same fundamental principles of conducting research (and teaching those results) and ethics. Scientific research is best practiced in a voluntary, honest and free atmosphere. But this idyllic arrangement as well as scientific ethics now belongs to the past ( The Corruption of Science )

“It’s a long-standing and crucial question that, as yet, remains unanswered: just how common is scientific misconduct? In the online, open-access journal PLoS ONE, Daniele Fanelli of the University of Edinburgh reports the first meta-analysis of surveys questioning scientists about their misbehaviours. The results suggest that altering or making up data is more frequent than previously estimated and might be particularly high in medical research.

...There is immense pressure on scientists to produce results, to publish, to seek glory, or just to get tenure. Scientists are human beings, after all, and sometimes they approach their field with preconceptions or biases. Politics certainly comes into play; consider eugenics in the United States at the beginning of the 20th century, or eugenics in Nazi Germany.

Now we can talk only about the level of political and economical pressure and corresponding level of corruption on professors and scientists, not so much about presence or absence of corruption in science and education. What really matters for students is that when they feel that a professor is a scum, they nevertheless try to imitate. See for example Harvard Mafia, Andrei Shleifer and the economic rape of Russia.

Historically the situation started to change even before neoliberal university became a dominant educational institution. Previously, despite the fact that money for science were in short supply, scientists maintained a self-discipline. That changed after WWII. Prior to World War II there was little government financial support for science. A graduate student working on a Ph.D. degree was expected to make a new discovery to earn that degree. And if somebody else came first he needed to find a new theme and to restart his work.

But with the advent of NSF scientists started to "propose" directions of research to get funding. And be sure this instill atmosphere of sycophantism and political correctness. This process accelerated dramatically since 1980th with the ascendance of neoliberalism as a dominant USA ideology, when greed became playing significant role in US universities. It should be understood that now the university professor is no longer is a teacher and a scientist, but predominantly "grants provider" for the university and that means that he/she is in the first place a political agent, a manipulator on a mission from the external agent (typically the state via NSF or other agency, see The Corruption of Science in America -- Puppet Masters -- Sott.net)

For the unwashed masses University professor career still represents the ultimate carrier of truth for a given discipline, so his opinion have a distinct political weight. And the architects of our neoliberal world fully use this "superstition". Like we can see with neoclassical economics, economists have turned into an instrument of cognitive manipulation, when under the guise of science financial oligarchy promote beneficial to itself but false and simplistic picture of the world, using University professors to brainwash the masses into "correct" thinking.

Professors literally became a religious figures, and cult members or even cult leaders. The first sign of this dangerous disease of the modern university was probably Lysenkoism in the USSR. In this sense one can say that Lysenkoism represented a natural side effect of shrinking of freedom of the scientific community and growing influence of political power on science. As by Frederick Seitz noted in his The Present Danger To Science and Society

Everyone knows that the scientific community faces financial problems at the present time. If that were its only problem, some form of restructuring and allocation of funds, perhaps along lines well tested in Europe and modified in characteristic American ways, might provide solutions that would lead to stability and balance well into the next century. Unfortunately, the situation is more complex, made so by the fact that the scientific establishment has become the object of controversy from both outside and inside its special domain. The most important aspects of the controversy are of a new kind and direct attention away from matters that are sufficiently urgent to be the focus of a great deal of the community's attention.

The assaults on science from the outside arise from such movements as the ugly form of "political correctness" that has taken root in important portions of our academic community. There are to be found, in addition, certain tendencies toward a home-grown variant of the anti-intellectual Lysenkoism that afflicted science in the Stalinist Soviet Union. So-called fraud cases are being dealt with in new, bureaucratic ways that cut across the traditional methods of arriving at truth in science. From inside the scientific community, meanwhile, there are challenges that go far beyond those that arise from the intense competition for the limited funds that are available to nourish the country's scientific endeavor.

The critical issue of arriving at a balanced approach to funding for science is being subordinated to issues made to seem urgent by unhealthy alliances of scientists and bureaucrats. Science and the integrity of its practitioners are under attack and, increasingly, legislators and bureaucrats shape the decisions that determine which paths scientific research should take. There is, in addition, a sinister tendency, especially in environmental affairs, toward considering the undertaking of expensive projects that are proposed by some scientists to remedy worst-case formulations of problems before the radical and expensive remedies are proven to be needed. They are viewed seriously though they are based on the advice of opportunistic alarmists in science who leap ahead of what is learned from solid research to encourage support for the expensive remedies they perceive to be necessary. The potential for very great damage to science and society is real.

Textbook racket is a part of neoliberal transformation of university education

Unfortunately a large part of the textbook market in the USA has all signs of corrupted monopoly infested with cronyism and incompetence to the extent that Standard Oil practices looks pretty benign in comparison. As the site MakeTextbooksAffordable.com states on its font page:

The report found that even though students already pay $900 year for textbooks, textbook publishers artificially inflate the price of textbooks by adding bells and whistles to the current texts, and forcing cheaper used books off the market by producing expensive new editions of textbooks that are barely different from the previous edition.

And some university professors are part of these scheme. Congressmen David Wu sites the opinion of the publisher in his letter "If a student is paying hundreds of dollars for a book, it's because the professor has ordered the Cadillac edition". But that might be true only for CS where any professor can easily find a cheaper high quality substitute from publishers like O'Reilly (and students can do this too, see Softpanorama Bookshelf actually about finding the best CS book (and some other) at reasonable prices. In other disciplines like mathematics situation is a real racket: The cost of a common calculus textbook is over $100 in the USA. This is a blatant, open rip-off. Economics is probably even worse with some useless junk selling for almost $300 per book.

In the meantime, enterprising students have many ways to cut the cost of buying textbooks.

But here one needs to see a bigger picture: low quality of recommended textbooks and, especially, the quality of university instruction makes it necessary buying additional textbooks. Also the ownership of best textbooks often makes the difference between success and failure in the particular course. In this sense additional $100 spending for books for each course makes economic sense as the common alternative is to drop the course, which often means $1K of more loss.

There are several ways to save on additional textbooks that hopefully can somewhat compensate for the low quality of tuition in a typical university. With some effort a student can often save approximately 50% of the cover price. Again my Links2bookstores page contains more information.

At the same time if the instructor is weak, or, worse, belongs to "fundamentalists", a category of instructors that does not distinguish between important and unimportant things and overloads the course with "useless overcomplexity" additional books are one of few countermeasures against this typical university-style rip-off. Dropping the course is a difficult maneuver that requires perfect timing and problems with instructor and the course content usually do not surface during the first month of the study when you can still do it for free or with minimal damage.

College textbook publishing became a racket with the growth of neoliberalism. And it is pretty dirty racket with willing accomplishes in form of so called professors like Greg Mankiw. For instance, you can find a used 5th edition Mankiw introductory to Microeconomics for under $4.00, while a new 7th edition costs over $200. An interesting discussion of this problem can be found at Thoughts on High-Priced Textbooks'

Tim Taylor on why textbooks cost so much:

Thoughts on High-Priced Textbooks: High textbook prices are a pebble in the shoe of many college students. Sure, it's not the biggest financial issue they face, But it's a real and nagging annoyance that for hinders performance for many students. ...
David Kestenbaum and Jacob Goldstein at National Public Radio took up this question recently on one of their "Planet Money" podcasts. ... For economists, a highlight is that they converse with Greg Mankiw, author of what is currently the best-selling introductory economics textbook, which as they point out is selling for $286 on Amazon. Maybe this is a good place to point out that I am not a neutral observer in this argument: The third edition of my own Principles of Economics textbook is available through Textbook Media. The pricing varies from $25 for online access to the book, up through $60 for both a paper copy (soft-cover, black and white) and online access.

Several explanations for high textbook prices are on offer. The standard arguments are that textbook companies are marketing selling to professors, not to students, and professors are not necessarily very sensitive to textbook prices. (Indeed, one can argue that before the rapid rise in textbook prices in the last couple of decades, it made sense for professors not to focus too much on textbook prices.) Competition in the textbook market is limited, and the big publishers load up their books with features that might appeal to professors: multi-colored hardcover books, with DVDs and online access, together with test banks that allow professors to give quizzes and tests that can be machine-graded. At many colleges and universities, the intro econ class is taught in a large lecture format, which can include hundreds or even several thousand students, as well as a flock of teaching assistants, so some form of computerized grading and feedback is almost a necessity. Some of the marketing by textbook companies involves paying professors for reviewing chapters--of course in the hope that such reviewers will adopt the book.

The NPR show casts much of this dynamic as a "principal-agent problem," the name for a situation in which one person (the "principal") wants another person (the "agent") to act on their behalf, but lacks the ability to observe or evaluate the actions of the agent in a complete way. Principal-agent analysis is often used, for example, to think about the problem of a manager motivating employees. But it can also be used to consider the issue of students (the "principals") wanting the professor (the "agent") to choose the book that will best suit the needs of the students, with all factors of price and quality duly taken into account. The NPR reporters quote one expert saying that the profit margin for high school textbooks is 5-10%, because those books decisions are made by school districts and states that negotiate hard. However, profit margins on college textbooks--where the textbook choice is often made by a professor who may not even know the price that students will pay--are more like 20%.

The NPR report suggests this principal-agent framework to Greg Mankiw, author of the top-selling $286 economic textbook. Mankiw points out that principal-agent problems are in no way nefarious, but come up in many contexts. For example, when you get an operation, you rely on the doctor to make choices that involve costs; when you get your car fixed, you rely on a mechanic to make choices that involve costs; when you are having home repairs done, you rely on a repair person or a contractor to make choices that involve costs. Mankiw argues that professors, acting as the agents of students, have legitimate reason to be concerned about tradeoffs of time and money. As he notes, a high quality book is more important "than saving them a few dollars"--and he suggests that saving $30 isn't worth it for a low-quality book.

But of course, in the real world there are more choices than a high-quality $286 book and a low-quality $256 book. The PIRG student surveys suggest that up to two-thirds of students are avoiding buying textbooks at all, even though they fear it will hurt their grade, or are shifting to other classes with lower textbook costs. If a student is working 10 hours a week at a part-time job, making $8/hour after taxes, then the difference between $286 book and a $60 book is 28.25 hours--nearly three weeks of part-time work. I am unaware of any evidence in which students were randomly assigned different textbooks but otherwise taught and evaluated in the same way, and kept time diaries, which would show that higher-priced books save time or improve academic performance. It is by no means obvious that a lower-cost book (yes, like my own) works less well for students than a higher-cost book from a big publisher. Some would put that point more strongly.

A final dynamic that may be contributing to higher-prices textbooks is a sort of vicious circle related to the textbook resale market. The NPR report says that when selling a textbook over a three-year edition, a typical pattern was that sales fell by half after the first year and again by half after the second year, as students who had bought the first edition resold the book to later students. Of course, this dynamic also means that many students who bought the book new are not really paying full-price, but instead paying the original price minus the resale price. The argument is that as textbooks have increased in price, the resale market has become ever-more active, so that sales of a textbook in later years have dwindled much more quickly. Textbook companies react to this process by charging more for the new textbook, which of course only spurs more activity in the resale market.

A big question for the future of textbooks is how and in what ways they migrate to electronic forms. On one side, the hope is that electronic textbooks will offer expanded functionality, as well as being cheaper. But this future is not foreordained. At least at present, my sense is that the functionality of reading and taking notes in online textbooks hasn't yet caught up to the ease of reading on paper. Technology and better screens may well shift this balance over time. But even setting aside questions of reading for long periods of time on screen, or taking notes on screen, at present it remains harder to skip around in a computerized text between what you are currently reading and the earlier text that you need to be checking, as well as skipping to various graphs, tables, and definitions. To say it more simply, in a number of subjects it may still be harder to study an on-line text than to study a paper text.

Moreover, as textbook manufacturers shift to an on-line world, they will bring with them their full bag of tricks for getting paid. The Senack report notes:

Today’s marketplace offers more digital textbook options to the student consumer than ever. “Etextbooks” are digitized texts that students read on a laptop or tablet. Similar to PDF documents, e-textbooks enable students to annotate, highlight and search. The cost may be 40-50 percent of the print retail price, and access expires after 180 days. Publishers have introduced e-textbooks for nearly all their traditional textbook offerings. In addition, the emergence of the ereader like the Kindle and iPad, as well as the emergence of many e-textbook rental programs, all seemed to indicate that the e-textbook will alter the college textbook landscape for the better.

However, despite this shift, users of e-textbooks are subject to expiration dates, on-line codes that only work once, page printing limits, and other tactics that only serve to restrict use and increase cost.

Unfortunately for students, the publishing companies’ venture into e-textbooks is a continuation of the practices they use to monopolize the print market.

JohnH:

My understanding is that there are cases where the professor requires the textbook he wrote and for which he receives royalties...

In such cases, the publisher and the professor's interests align against the student, who pays through the teeth.

djb:

good article but i have a real problem with introductory texts on economics

they are completely biased, mostly towards supply side of the debate

meaning, of course, they are wrong

if they just contained that which is undeniably true then ok, or if they presented it as this school of thought says this and that school of thought says the other, ok,

The Raven:

A general rule of thumb: half the selling price of a book is spent before the first impression is made on paper. Speaking as a very small publisher, I think the main problem is that the texts are expensive to produce.

They take a lot of editorial and design effort, so the fixed costs of textbook production are high, the production costs are often high, and textbook bestsellers are not common, so they don't usually make it up on volume.

Now, one could, for standard freshman and sophomore texts, aim at lower costs and higher volumes, but that's not academic publishing, and nothing is going to help with upper-level texts; the market is just not that big.

pgl -> to The Raven...

Excellent! With a high elasticity of demand, the increase in quantity beats the drop in price. Unless the marginal cost of printing books is higher than I suspect it is, Mankiw's publisher is not a profit maximizing monopolist. I'm telling you the best economics is right here and we don't charge $286!

The Raven -> to pgl...

Thanks.

You'd have to market a book *hard* to get that increase in demand, though. It's not a student-by-student sale decision; the professors have to be marketed. The other thing about publishing economics that people outside the industry don't realize: most books don't make much money, so publishers rely on the good-sellers and the best-sellers for much of their profits. If you've got something you're pretty sure is going to be in demand, *you mark it up,* because in William Golding's immortal phrase, "Nobody knows anything."

Over the past 25 or so years, the consolidation of publishing has put the money types more and more in control of the business. And the money types always want to only market best sellers. This is sort of like Germany saying that everyone should make money exporting. "That trick never works."

Now, if anyone wanted to bring the price of an Econ 101 book down, one could do a no-frills book, small, soft-covered, and strictly monochrome, or perhaps an ebook. (But watch out—only some ebook readers support mathematics well.) It might cost $50 or so (I'm guessing—I'm not a textbook publisher.) It would not look impressive, and this might make a problem for marketing, but students could still learn from it. And—who knows?—it might even sell.

T.J.:

The issue is that textbook publishers release new editions every couple of years. For many subjects, including economics, this is absurd. Sciences don't change that quickly.

For instance, you can find a used 5th edition Mankiw introductory to Microeconomics for under $4.00, while a new 7th edition costs over $200.

Has principles of microeconomics changed that much over the course of 6 years? No, but textbook companies make a few changes on the margin and charge you hundreds of dollars for a new edition. Many times, professors require online access codes to supplement their lecture. Therefore, the student is forced into the newer edition, in which often there is no substantial differences or major improvements in presenting the material.

When you have that sort of market power, it is easy to achieve economic rents.

pgl -> to T.J....

"Sciences don't change that quickly". One would hope those freshwater books changed after their utter failures to predict the most recent recession. But they likely haven't.

cm -> to T.J....

There are errata, and some content that the author has in mind doesn't make it into the first edition, or not at the intended quality/depth. Most people who have never published something substantial have no idea how much work it is to get non-fiction scientific/technical stuff publication ready. Not only on the author's part but also editing and proofreading/giving feedback at a collegial level. (Not meaning to knock down fiction, that's a different set of challenges.)

Bill Ellis:

Two Ideas I would like to see combined. A period of Universal public service that earns a free higher and or tech education. Something like the GI bill for all.

I think making universal public service a right of passage could help us be a more unified society. If we have kids from inner city Detroit, rural West Virginia, suburban San Francisco and the oil fields of Oklahoma working side by side it would open their eyes to each other in ways that are never experienced by most American kids who are living in communities of institutional self-segregation.

Having said that.. free education is a no brainer no matter what.
To cover everyone's tuition it would only cost us about forty billion more than the feds already spend on higher ed. That's a rounding error in terms of our total budget.

We subsidize big oil and gas to the tune of about 50 billion a year.

The maddening thing is that the national debate is not even close to taking Free Ed seriously. Instead Liz Warren is portrayed some kind of wild eyed radical for proposing a modest cut in interest rates on student loans and some narrow way to get some forgiveness of debt.

John Cummings:

It is part of the educational industrial complex (which include vouchers and government backed private school industrial complex)

Educational industrial complex
Military industrial complex
Medical industrial complex
Prison industrial complex

Fred C. Dobbs:

(Evidently, 'It’s Economics 101'.)

Higher education: Why textbooks cost so much http://econ.st/1yzDU5Z via @TheEconomist - Aug 16th 2014

Students can learn a lot about economics when they buy Greg Mankiw’s “Principles of Economics”—even if they don’t read it. Like many popular textbooks, it is horribly expensive: $292.17 on Amazon. Indeed, the nominal price of textbooks has risen more than fifteen fold since 1970, three times the rate of inflation (see chart, at link).

Like doctors prescribing drugs, professors assigning textbooks do not pay for the products themselves, so they have little incentive to pick cheap ones. Some assign books they have written themselves. The 20m post-secondary students in America often have little choice in the matter. Small wonder textbooks generate megabucks.

But hope is not lost for poor scholars. Foreign editions are easy to find online and often cheaper—sometimes by over 90%. Publishers can be litigious about this, but in 2013 the Supreme Court ruled that Americans have the right to buy and resell copyrighted material obtained legally. Many university bookstores now let students rent books and return them. Publishers have begun to offer digital textbooks, which are cheaper but can’t be resold. And if all else fails, there is always the library.

Related: How Your Textbook Dollars Are Divvied Up http://t.usnews.com/a2B567 via @usnews - Aug 28, 2012

Fred C. Dobbs -> to Fred C. Dobbs...

(A bunch of experts discuss the matter.)

Room for Debate: The Real Cost of College Textbooks http://nyti.ms/1qEHasX - July 2010

(Including a couple of economists!)

Fred C. Dobbs -> to Fred C. Dobbs...

How to Cut Your Textbook Costs in Half -- or More-Kiplinger http://po.st/nCZsxY - August 2014

(By renting e-books, donchaknow.)

(Turns out Mankiw's Econ textbook, which
currently costs $289 in hardcover from
Amazon, can be rented in Kindle format
for a mere $173 - for 180 days.)

(Hardcover rental is $70, however.)

Fred C. Dobbs -> to Fred C. Dobbs...

(Wait a second. The Federales fixed
this problem back in 2008...)

Advocates say a new set of federal provisions, aimed at driving down the cost of college textbooks, should help students this fall. On July 1, (2010) these rules took effect:

Publishers must give professors detailed information about textbook prices, revision histories and a list of alternate formats.

Publishers have to sell materials typically bundled with textbooks -- such as CDs, DVDs and workbooks -- separately so students don't have to buy them.

Colleges have to include in-course schedules with required textbooks for each class, including the book's price and International Standard Book Number, an identifying tool.

The protections, included in the Higher Education Opportunity Act of 2008, are an attempt to lessen student debt, said U.S. Sen. Richard Durbin, D-Ill., on Wednesday.

"The cost of education is of concern not only to students and families but to the nation," Durbin said, explaining why the government got involved in textbook prices. "Students are emerging with more and more debt."

http://www.mcclatchydc.com/2010/07/22/97931_new-federal-rules-take-aim-at.html?rh=1

Charles Peterson:

A $289 econ text is only marked up 20% ???

I'm not sure how to account for this, but I believe a full account of markup should include royalties if they have become outrageous economic rent.

Jim Harrison:

Textbooks have been outrageously expensive for a long time, though some of the prices quoted in this article were astonishing to me and I used to be in the business. Nothing much has changed. The complaints and the defenses sound very familiar. Even in the 70s and 80s, publishers groused about how the used trade hurt their sales and the suggestion was repeatedly made that one way around the trap was to produce much cheaper texts and make up the difference on volume. Unfortunately, the numbers never add up for that business plan since the major textbook publishers have huge sunk costs in the big sales forces needed to support the current model. Anyhow, good cheap books have long been available for many big undergrad courses if profs want to assign them and don't mind producing their own tests and other teaching aids. A handful of profs do just that and were already doing it thirty years ago, but they are a distinct minority.

About the revision racket: the funny thing is that old editions of textbooks are often better than more recent editions. Market research makes good books worse in much the same way that it eventually screws up software by the relentless addition of bells and whistles. I'm a technical writer these days and keep copies of several old classics at hand when I need to brush up: Feynman's lectures on physics; the first edition of Freeman, Pisani, and Purves on Statistics; the 2nd edition of Linus Pauling's Intro Chem text; Goldstein on Thermo; and a real museum piece, Sylvaner Thomas' Calculus Made Easy. Many of these books have been reprinted by Dover and are available for peanuts.

To be fair, the high price for textbooks makes more sense in some fields than in others. The three or four year revision cycle is absurd for math books since the math remains the same decade after decade, but texts in areas like molecular biology really do have to be revised frequently and substantively, a very labor-intensive task. Which is why I give a pass to the Biology editors and the folks who struggle to update the Intermediate Accounting books with the latest FASB standards.

cm -> to Jim Harrison...

Can you elaborate on the revision "paradox"? Surely not only in very new fields, the state of the art progresses, or textbook authors see a need or opportunity to include new material (I suspect somebody setting out to write a comprehensive text has more ideas what to write about than can be finished at the required quality in the required time, for the first edition).

How would the subsequent editions be worse, if the new content is driven by the author and not by external marketing considerations, unless the new material is at the expense of older material (e.g. #pages limit)?

From my very limited experience, authors who are not in it for making a profit, and who write for a small market (selling up to a few thousand copies per year is a small market) run into substantial overhead costs for editing, marketing (i.e. making the existence of the book known to the target audience), and distribution, and basically have to do the work for free. Some, and perhaps most, certainly academic, publishers have "charity" programs where they publish small editions where they at best break even or even cross-subsidize them out of "full rate" publications. Then people complain about excessive prices for the latter.

Leading Edge Boomer:

Jeebus, $286 for a textbook, from an author who is often wrong lately? I co-authored a graduate computer science text (low volume = higher cost) that retailed in the low two digits.

cm -> to Leading Edge Boomer...

I will not comment on the author's merit or lack thereof, but $286 is really in "WTF" territory, for any textbook.

cm -> to Leading Edge Boomer...

I once contributed to a book, and the authors/editors decided to collectively waive their royalties to hit an affordable price (and I suspect it was still a charity deal on the part of the largely academic publisher). But I got my free copy.

Jim Harrison:

At least for big market textbooks, the motive for revisions is generally financial and that's as true for the authors as the publishers. In fact, the authors are often the ones who push for new editions as their royalty checks steadily diminish. In cases where it's the authors who are reluctant to revise for whatever reason, publishers often sweeten the deal with advances, grants, or other goodies.

I don't mean to be completely cynical. Authors and editors certainly try to produce a better product when they put out new editions, and it very often happens that the second edition is better than the first. Especially in later cycles, however, the changes are usually pretty cosmetic. The editor in charge of the project solicits advice from users and potential users and comes up with a list of "improvements" in a process not entirely different than what happens when various interests in Washington get their pet provisions put in a bill. If you think that professor X is likely to adopt the text if you go along with his ideas and plug his contributions in the acknowledgements, the idea is very likely to be irresistible.

The sales force also weighs in. They want feature they can tout; but since real improvements are hard to come by, that usually means more and more pedagogy: boxes, pictures, computer programs, and umpteen forms of emphasis. Let me assure you it takes desperate ingenuity to come up with something new to add to an Intermediate Algebra textbook. "Now with a new way to factor trinomials" isn't exactly a memorable pitch. Meanwhile, after three or four editions, the author, who presumably would be the best source of serious innovation for a new edition, is generally bored to death with the project.

As I said above, there are textbooks that really do need perpetually revision for substantive reasons; but in most fields what Freshmen and Sophomores need to learn has been known for a long time. My remarks on revisions also don't apply very well to upper level texts in smaller markets, in part because students tend to hang on to serious books in their majors so the companies have less incentive to beat the used book market with new editions.

reason:

From what I remember of my university days (in the long distant past), we didn't have text books (that was for school kids). We had lectures and lists of reading materials (that if we were lucky we could find in the library and photocopy relvant sections). I did have a copy of Samualson (relatively cheap). But the emphasis was on a reading a variety of sources. What has changed, and why?

reason:

P.S. Not have text books would have the advantage of ensuring that the students attended lectures and stayed awake during them.

Jay:

No mention of the cost for this textbook...

http://www.amazon.com/Economics-Paul-Krugman/dp/1429251638/ref=sr_1_2?ie=UTF8&qid=1413545846&sr=8-2&keywords=krugman+wells

grizzled:

My own biggest peeve concerns calculus textbooks, especially introductory calculus textbooks. The material hasn't changed in at least 60 years, if not longer. If it weren't for the current ridiculously long copyright terms people could just use old ones.

The last time I took the subject our professor went to some lengths to let us use the previous edition, which was available used. The only real change in the next edition was in the problems. That is, if a student was assigned "problem 8 in section xxx" having the most recent edition was the only way to know what the problem was.

I don't see any redeeming value in this.

Bloix:

My son took an intro geology course a few years ago. The textbook price at the school bookstore was about $125. He purchased the gray market (legal) "international edition" - word for word, page for page the same, but with a different picture on the cover - over the internet for about $50.

It's my understanding that this sort of price-differential is common. Mankiw's book appears to be available in the "international edition" for $60 (soft cover).

http://www.abebooks.com/9781285165875/Principles-Economics-7th-Edition-Mankiw-128516587X/plp

Please don't tell me that publishers and authors are not making money when they sell their books for US$50 or 60 in Australia.

Dr. Nikolai Bezroukov


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[Jun 24, 2017] Michael Hudson: Are Students a Class?

Notable quotes:
"... the use of debt as a primary weapon in class warfare ..."
"... They were in hock to the man, and eventually became slaves to him. This structure, of sharecropping and usury, held together by political violence, continued into the 1960s in some areas of the South. As late as the 1960s, Kennedy would see rural poverty in Arkansas and pronounce it 'shocking'. These were the fruits of usury, a society built on unsustainable debt peonage. ..."
"... Today, we are in the midst of creating a second sharecropper society ..."
"... Today, the debts do not involve liens against crops. People in modern America carry student loans, credit card debt, and mortgages. All of these are hard to pay back, often bringing with them impenetrable contracts and illegal fees. Credit card debt is difficult to discharge in bankruptcy and a default on a home loan can leave you homeless. A student loan debt is literally a claim against a life - you cannot discharge it in bankruptcy, and if you die, your parents are obligated to pay it. If the banks have their way, mortgages and deficiency judgments will follow you around forever, as they do in Spain. ..."
"... By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is J is for Junk Economics ..."
"... Students usually don't think of themselves as a class. They seem "pre-class," because they have not yet entered the labor force. They can only hope to become part of the middle class after they graduate. And that means becoming a wage earner – what impolitely is called the working class. ..."
"... But as soon as they take out a student debt, they become part of the economy. They are in this sense a debtor class. But to be a debtor, one needs a means to pay – and the student's means to pay is out of the wages and salaries they may earn after they graduate. And after all, the reason most students get an education is so that they can qualify for a middle-class job. ..."
"... Shedding crocodile tears for the slow growth of U.S. employment in the post-2008 doldrums (the "permanent Obama economy" in which only the banks were bailed out, not the economy), the financial class views the role industry and the economy at large as being to pay its employees enough so that they can take on an exponentially rising volume of debt. Interest and fees (late fees and penalties now yield credit card companies more than they receive in interest charges) are soaring, leaving the economy of goods and services languishing. ..."
"... Students are the new NINJAs: No Income, No Jobs, No Assets. But their parents have assets, and these are now being grabbed, even from retirees. Most of all, the government has assets – the power to tax (mainly labor these days), and something even better: the power to simply print money (mainly Quantitative Easing to try and re-inflate housing, stock and bond prices these days). Most students hope to become independent of their parents. But burdened by debt and facing a tough job market, they are left even more dependent. That's why so many have to keep living at home. ..."
"... A must-read primer on debt peonage and how universities are basically real estate hoarders and debtor magnets for the banks. ..."
"... Not to mention the incredible amount of cheating that goes on at universities. I guess cheating at college is training for joining the Kleptocracy. ..."
"... The question to ask, I think, is about the sustainability of this inversion of the dream of education as the path to upward mobility. People do not need to fully, or even partially, intellectually grasp the causes of their misery and sense of failure and futility to overthrow the status quo. This is the ideal -typically coming from the left- where informed citizens will recognize class conflict in its current form, neoliberal policies enriching the 1% and impoverishing most of the rest, and take over the government by voting out corrupt and captured politicians. ..."
"... Once the difference between education and indoctrination is learned, thee student and debtors in general can be "woke." How many students even think they should put themselves through a process of de-institutionalization, especially if they've followed the course of 1st grade to college graduation without a break? ..."
"... Today, the debts do not involve liens against crops. People in modern America carry student loans, credit card debt, and mortgages ..."
"... Perhaps Michael Hudson is – somewhat sloppily – referring to the IIRC typical case where getting the loan requires someone to sign on as guarantor, normally the student's parents. ..."
Jun 01, 2017 | www.nakedcapitalism.com

Yves here. Matt Stoller anticipated the situation Michael Hudson describes, the use of debt as a primary weapon in class warfare. From a 2010 post :

A lot of people forget that having debt you can't pay back really sucks. Debt is not just a credit instrument, it is an instrument of political and economic control.

It's actually baked into our culture. The phrase 'the man', as in 'fight the man', referred originally to creditors. 'The man' in the 19th century stood for 'furnishing man', the merchant that sold 19th century sharecroppers and Southern farmers their supplies for the year, usually on credit. Farmers, often illiterate and certainly unable to understand the arrangements into which they were entering, were charged interest rates of 80-100 percent a year, with a lien places on their crops. When approaching a furnishing agent, who could grant them credit for seeds, equipment, even food itself, a farmer would meekly look down nervously as his debts were marked down in a notebook. At the end of a year, due to deflation and usury, farmers usually owed more than they started the year owing. Their land was often forfeit, and eventually most of them became tenant farmers.

They were in hock to the man, and eventually became slaves to him. This structure, of sharecropping and usury, held together by political violence, continued into the 1960s in some areas of the South. As late as the 1960s, Kennedy would see rural poverty in Arkansas and pronounce it 'shocking'. These were the fruits of usury, a society built on unsustainable debt peonage.

Today, we are in the midst of creating a second sharecropper society

Today, the debts do not involve liens against crops. People in modern America carry student loans, credit card debt, and mortgages. All of these are hard to pay back, often bringing with them impenetrable contracts and illegal fees. Credit card debt is difficult to discharge in bankruptcy and a default on a home loan can leave you homeless. A student loan debt is literally a claim against a life - you cannot discharge it in bankruptcy, and if you die, your parents are obligated to pay it. If the banks have their way, mortgages and deficiency judgments will follow you around forever, as they do in Spain.

Young people and what only cynics might call 'homeowners' have no choice but to jump on the treadmill of debt, as debtcroppers. The goal is not to have them pay off their debts, but to owe forever. Whatever a debtcropper owes, a wealthy creditor owns.

And as a bonus, the heavier the debt burden of American citizenry, the less able we are able to organize and claim our democratic rights as citizens. Debtcroppers don't start companies and innovate, they don't take chances, and they don't claim their political rights. Think about this when you hear the calls from ex-Morgan Stanley banker and current World Bank President Robert Zoellick and his nebulous mutterings pining for the gold standard. Or when you hear Warren Buffett partner Charlie Munger talk about how the bailouts of the wealthy were patriotic, but we mustn't bail out homeowners for fear of 'moral hazard'.

Or when you hear Pete Peterson Foundation President and former Comptroller General David Walker yearn nostalgically for debtor's prisons.

Focusing on students, Hudson shows how much "progress" has been made in a mere seven years.

By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is J is for Junk Economics

Students usually don't think of themselves as a class. They seem "pre-class," because they have not yet entered the labor force. They can only hope to become part of the middle class after they graduate. And that means becoming a wage earner – what impolitely is called the working class.

But as soon as they take out a student debt, they become part of the economy. They are in this sense a debtor class. But to be a debtor, one needs a means to pay – and the student's means to pay is out of the wages and salaries they may earn after they graduate. And after all, the reason most students get an education is so that they can qualify for a middle-class job.

The middle class in America consists of the widening sector of the working class that qualifies for bank loans – not merely usurious short-term payday loans, but a lifetime of debt. So the middle class today is a debtor class.

Shedding crocodile tears for the slow growth of U.S. employment in the post-2008 doldrums (the "permanent Obama economy" in which only the banks were bailed out, not the economy), the financial class views the role industry and the economy at large as being to pay its employees enough so that they can take on an exponentially rising volume of debt. Interest and fees (late fees and penalties now yield credit card companies more than they receive in interest charges) are soaring, leaving the economy of goods and services languishing.

Although money and banking textbooks say that all interest (and fees) are a compensation for risk, any banker who actually takes a risk is quickly fired. Banks don't take risks. That's what the governments are for. (Socializing the risk, privatizing the profits.) Anticipating that the U.S. economy may be unable to recover under the weight of the junk mortgages and other bad debts that the Obama administration left on the books in 2008, banks insisted that the government guarantee all student debt. They also insisted that the government guarantees the financial gold-mine buried in such indebtedness: the late fees that accumulate. So whether students actually succeed in becoming wage-earners or not, the banks will receive payments in today's emerging fictitious "as if" economy. The government will pay the banks "as if" there is actually a recovery.

And if there were to be a recovery, then it would mean that the banks were taking a risk – a big enough risk to justify the high interest rates charge on student loans.

This is simply a replay of what banks have negotiated for real estate mortgage lending. Students who do succeed in getting a job hope to start a family, or at least joining the middle class. The most typical criterion of middle-class life in today's world (apart from having a college education) is to own a home. But almost nobody can buy a home without getting a mortgage. And the price of such a mortgage is to pay up to 43 percent of one's income for thirty years, that is, one's prospective working life (in today's as-if world that assumes full employment, not just a gig economy).

Banks know how unlikely it is that workers actually will be able to earn enough to carry the costs of their education and real estate debt. The costs of housing are so high, the price of education is so high, the amount of debt that workers must pay off the top of every paycheck is so high that American labor is priced out of world markets (except for military hardware sold to the Saudis and other U.S. protectorates). So the banks insist that the government pretends that housing as well as education loans not involve any risk for bankers.

The Federal Housing Authority guarantees mortgages that absorb up to the afore-mentioned 43 percent of the applicant's income. Income is not growing these days, but job-loss is. Formerly middle-class labor is being downsized to minimum-wage labor (MacDonald's and other fast foods) or "gig" labor (Uber). Here too, the fees mount up rapidly when there are defaults – all covered by the government, as if it is this compensates the banks for risks that the government itself bears.

From Debt Peons to Wage Slaves

In view of the fact that a college education is a precondition for joining the working class (except for billionaire dropouts), the middle class is a debtor class – so deep in debt that once they manage to get a job, they have no leeway to go on strike, much less to protest against bad working conditions. This is what Alan Greenspan described as the "traumatized worker effect" of debt.

Do students think about their future in these terms? How do they think of their place in the world?

Students are the new NINJAs: No Income, No Jobs, No Assets. But their parents have assets, and these are now being grabbed, even from retirees. Most of all, the government has assets – the power to tax (mainly labor these days), and something even better: the power to simply print money (mainly Quantitative Easing to try and re-inflate housing, stock and bond prices these days). Most students hope to become independent of their parents. But burdened by debt and facing a tough job market, they are left even more dependent. That's why so many have to keep living at home.

The problem is that as they do get a job and become independent, they remain dependent on the banks. And to pay the banks, they must be even more abjectly dependent on their employers.

It may be enlightening to view matters from the vantage point of bankers. After all, they have $1.3 trillion in student loan claims. In fact, despite the fact that college tuitions are soaring throughout the United States even more than health care (financialized health care, not socialized health care), the banks often end up with more education expense than the colleges. That is because any interest rate is a doubling time, and student loan rates of, say, 7 percent mean that the interest payments double the original loan value in just 10 years. (The Rule of 72 provides an easy way to calculate doubling times of interest-bearing debt. Just divide 72 by the interest rate, and you get the doubling time.)

A fatal symbiosis has emerged between banking and higher education in America. Bankers sit on the boards of the leading universities – not simply by buying their way in as donors, but because they finance the transformation of universities into real estate companies. Columbia and New York University are major real estate holders in New York City. Like the churches, they pay no property or income tax, being considered to play a vital social role. But from the bankers' vantage point, their role is to provide a market for debt whose magnitude now outstrips even that of credit card debt!

Citibank in New York City made what has been accused of being a sweetheart deal with New York University, which steers incoming students to it to finance their studies with loans. In today's world a school can charge as much for an education as banks are willing to lend students – and banks are willing to lend as much as governments will guarantee to cover, no questions asked. So the bankers on the school boards endorse bloated costs of education, knowing that however much more universities make, the bankers will receive just as much in interest and penalties.

It is the same thing with housing, of course. However much the owner of a home receives when he sells it, the bank will make an even larger sum of money on the interest charges on the mortgage. That is why all the growth in the U.S. economy is going to the FIRE sector, owned mainly by the One Percent.

Under these terms, a "more educated society" does not mean a more employable labor force. It means a less employable society, because more and more wage and consumer income is used not to buy goods and services, not to eat out in restaurants or buy the products of labor, but to pay the financial sector and its allied rentier class. A more educated society under these rules is simply a more indebted society, an economy succumbing to debt deflation, austerity and unemployment except at minimum-wage levels.

For half a century Americans imagined themselves getting richer and richer by going into debt to buy their own homes and educate their children. Their riches have turned out to be riches for the banks, bondholders and other creditors, not for the debtors. What used to be applauded as "the middle class" turns out to be simply an indebted working class.

HBE , June 1, 2017 at 8:21 am

In today's world a school can charge as much for an education as banks are willing to lend students – and banks are willing to lend as much as governments will guarantee to cover, no questions asked.

Banks are (debt) slave owners, but universities are the (debt) slave merchants and overseers. Which is probably why campuses aren't filled with groups fighting for labor rights or discussing the abysmal economic reality they face.

Instead virtue signalling, woke IdPol is the dominant focus, which is just fine with the overseer, and nurtured by the comfortable tenured faculty, who are often quite happy having little debt slave house servants of their own (grad students, adjuncts).

And even worse the overseers (universities) don't put the revenue generated by slaves into improving classes, hiring more full time faculty, or a host of other factors that improve the quality of education.

They funnel it into aesthetics to make things look more appealing on tours, and materials, they use to attract more slaves, all the while crapifying quality of education. Which is the moat odious aspect of their role, they arent using the slaves to build a better educational system, but to get more slaves. The number of useless PowerPoint lectures I sat through makes me angry when I think about it.

Universities are the wives (or husbands) that look on and enable child abuse Almost, if not more disgusting than the abuser (banks).

And this is coming from a lucky grad who managed to stay out of the gig economy.

nycTerrierist , June 1, 2017 at 8:42 am

Well put. Outstanding posts by Stoller and Hudson. A must-read primer on debt peonage and how universities are basically real estate hoarders and debtor magnets for the banks.

hemeantwell , June 1, 2017 at 5:59 pm

Credit where it's due: I'm a fan of both Stoller and Hudson, but I believe Hudson has been emphasizing debt in his writings far longer than Stoller. From Wikipedia:

Hudson [aged 78] devoted his entire scientific career to the study of debts: both domestic (loans, mortgages, interest payments) and external. In his works he consistently advocates the idea that loans and exponentially growing debts that outstrip profits from the economy of the "real" sphere are disastrous for both the government and the people of the borrowing state: they are washing money (going to payments to usurers and rentiers) from turnover, not leaving them to buy goods and services, and thus lead to "debt deflation" of the economy "

Stephen Gardner , June 1, 2017 at 9:05 am

The rentier class is just a bit out over its skis on this. First, college debt is not "out of sight our of mind" the way rural poverty in the deep south is and was. The victims of the banks are geographically well distributed and numerically much greater than southern sharecroppers. I don't think the demographics of the Bernie Sanders movement is any accident. Young people in this country are not illiterate farmers. They often are well educated. Furthermore an education is something that cannot be confiscated by a bank in lieu of payment on a loan. Geographic distribution of victims is very important from the point of view of networking. As much as we have become more isolated as individuals due to some of the forces present in American society, victims of the rentier class are in close proximity to one another and in contact. They are also present all over the US. Like a fire fed by uncut underbrush in a forest the flames may spread quickly. When it happens, none of the prognosticators will have seen it coming–not even those of the left.

justanotherprogressive , June 1, 2017 at 10:09 am

While I agree with your post, I quibble with your first line. I don't think the rentier class is "over its skis" with this one any more than the airline industry is "over its skis" with what it has been doing. As long as people are willing to put up with these tactics, they will continue .and get worse. There is no incentive for them to stop or slow down .

UserFriendly , June 2, 2017 at 12:30 am

It's not that people put up with it I know dozens that just have no hope, faith, or sense that change is even possible; so crippled with anxiety over their finances that they are utterly useless, myself included. When there is no light at the end of the tunnel it is almost impossible to muster the effort to do anything.

David , June 1, 2017 at 10:36 am

"Furthermore an education is something that cannot be confiscated by a bank in lieu of payment on a loan."

..which is why the government guarantee exists – coupled with the fact that the "education" for most is largely a myth – a degree is not an education.

As widely reported in NYC public schools last year – the graduation rate is 86%, but tests show less than 4% comprehension for math and english as reported in the NYP last year – same is largely true for higher education except for the price tag. The sharecroppers at least had tangibles to show from the financing exercise however meager they might be at the end of the day – the degree is largely worthless.

The banks will do .. fine

Allegorio , June 1, 2017 at 12:22 pm

Not to mention the incredible amount of cheating that goes on at universities. I guess cheating at college is training for joining the Kleptocracy.

DanB , June 1, 2017 at 11:43 am

The question to ask, I think, is about the sustainability of this inversion of the dream of education as the path to upward mobility. People do not need to fully, or even partially, intellectually grasp the causes of their misery and sense of failure and futility to overthrow the status quo. This is the ideal -typically coming from the left- where informed citizens will recognize class conflict in its current form, neoliberal policies enriching the 1% and impoverishing most of the rest, and take over the government by voting out corrupt and captured politicians.

What is far more likely is that scapegoats are offered -a la Trump or some other demagogue. (But scapegoating leaves exploitation unresolved.) Whichever occurs, the current system of exploitation cannot go on, especially when all the other factors associated with hitting the limits to growth are considered.

LT , June 1, 2017 at 12:16 pm

Once the difference between education and indoctrination is learned, thee student and debtors in general can be "woke." How many students even think they should put themselves through a process of de-institutionalization, especially if they've followed the course of 1st grade to college graduation without a break?

Dead Dog , June 1, 2017 at 10:20 am

Thank you Michael. I studied economics at ANU and went through the period when Australia considered the cost of a university education, which back in the early 80s was free (I think we paid around $150 by way of Union subs). One of the new questions for students was the issue of education being a private or public good.

The Labor Treasurer at the time (and later Prime Minister), Paul Keating, made it quite clear that education had more of the characteristics of a private good and the benefits (public good aspect) of a quality education for the country were erased and have never been seen (discussed) again.

Money changed university and that change has not been positive for the institutions or the citizens they serve.

Grumpy Engineer , June 1, 2017 at 10:21 am

This article is a little misguided. I absolutely agree that excess student debt is becoming a major problem in American society that is causing all sorts of real problems, but to blame "the bankers" is to point a finger at the wrong culprit.

The true culprit is grotesque symbiosis between the colleges & universities and the US Department of Education , which issues over 90% of student loans. If you want to know who the predatory lender is here, look to Washington. The banks are just participating at the edges of our student loan fiasco.

Part of the problem is the popular concept of "good debt" vs. "bad debt", as espoused by economists such as Jared Bernstein. "Good debt" helps increase your earning potential, so the more good debt the government pushes on the populace, the better. Right? It's a popular concept in DC.

And it's crap. And the government is crushing an entire generation of students with excess debt in the process. I think Michelle Singletary summarized it well: Yes, All Debt is Bad Debt .

diptherio , June 1, 2017 at 11:05 am

So you think that the banksters are only profiting on this by accident? Who do you think is lobbying to have student loan debt made non-dischargeable? Who do you think is lobbying the Dept. of Ed. to guarantee all those loans?

For sure, there is more than enough blame to go around, and multiple actors have earned their share. But to place the majority of the blame outside the financial sector that, as Hudson points out, always profits MORE from debt than the people whose products that debt is used to buy, is a bit on the bizarre side.

Banks make money by creating debt and getting their victims er, customers to take that debt on. Therefore, bankers have an interest in increasing the overall level of debt in an economy. When you see debt skyrocketing, look around for an unscrupulous banker.

Grumpy Engineer , June 1, 2017 at 11:34 am

Your understanding of student loans is behind the times. The federal government hasn't guaranteed any privately-issued student loans since June of 2010. That was seven years ago.

This was Obama's great "improvement" to student lending. Cut the bankers out of the loop and have the government issue loans directly. And somehow the total amount of debt being carried by students managed to skyrocket anyway. It actually accelerated . And the government routinely employs debt collection practices (like seizing Social Security checks) that were rightly outlawed in the private sector. Those evil debt-collection companies that you regularly hear about in the news? Hired by our government for purposes of collecting on federal student loans.

Private banks only hold $150 billion out of $1.44 trillion in total student debt. That's barely 10%. Sure, the banks make some profit here. But the bulk of the problem is the federal loans. It's our own government that is crushing an entire generation of students with excess debt.

Eleanor Rigby , June 1, 2017 at 12:21 pm

If I understand correctly, this change was implemented as a part of Obamacare. "We won't know what is in it until we pass it." I wonder what else is in that bill.

Allegorio , June 1, 2017 at 12:38 pm

Your comment does not contradict Hudson's assertion that student debt creates compliant employees, making it difficult to change employment or stand up to employers. Likewise all the surveillance makes people afraid to protest and demonstrate, in case they lose their jobs.

The true evil is compound interest where the interest on a loan far exceeds the original loan. Economic activity increases linearly, interest geometrically. Does risking x dollars entitle you to x^n compensation. It is interesting to note, that in the ancient world the majority of slaves were not due to conquest but default on debt. The revival of slavery and serfdom is an obsession with the .001%ers. No robot can ever match the service of a subjugated human being. This country is ruled by murderers and thieves, sad to say.

Alejandro , June 1, 2017 at 2:50 pm

In this latest mutation, how and who does the loan servicing?

Left in Wisconsin , June 1, 2017 at 3:29 pm

Someone else may know better but I believe the govt hired 4 of the former loan originators/servicers to do all of the servicing nationwide.

Grumpy Engineer , June 1, 2017 at 4:25 pm

The Department of Education has contracted out the loan servicing, a practice that has led to even further abuse of borrowers. I found this list of about a dozen different servicers, but it's from 2013 and is likely out of date:

http://thecollegeinvestor.com/9892/the-complete-list-of-federal-student-loan-servicers/

Sam Adams , June 1, 2017 at 1:21 pm

Uncle Joe Biden.
Contribute to the Joe Biden (student debt peonage fund) 2020 PAC.

Paul art , June 1, 2017 at 3:35 pm

Marvelous hijack of the thread here buddy. Start talking about lousy Government instead of everything else. Brilliant move. You should apply to some Right Wing Think Tanks. I reckon they will pay handsomely for a brain like yours.

PhilM , June 1, 2017 at 6:41 pm

Yeah, buster, don't be going and confusing people with interesting facts and points of view that haven't already been expressed thousands of times! What do you think this is, an anechoic chamber?

djrichard , June 1, 2017 at 11:30 am

the US Department of Education, which issues over 90% of student loans

Usually something like this would trigger hand waving about the Fed Gov crowding out the private sector. But in this case, crickets. I wonder why.

In a related note, presumably any loans issued by the Fed Gov do not actually increase the monetary base. So in a way, the Fed Gov is at cross purposes with the Fed Reserve which is doing everything in its power to create private debt inflation (increase of the monetary base). Banks to indebted students: "wake me up when you paid off Uncle Sam and we can do bidness."

Which triggers my suspicion on why the banks are pro immigration – because I believe immigrants would more or less be free of debt. Banks to themselves: "what's not to love? Oops, I mean give us your down-trodden, your poor".

Lynne , June 1, 2017 at 10:34 am

Today, the debts do not involve liens against crops. People in modern America carry student loans, credit card debt, and mortgages

Hard to say just how angry this makes me. I know most of the county likes to sneer at farmers, even more than others in flyover country. But to read this statement in a supposedly thoughtful article makes my blood boil. Given the vast consolidation in land ownership (Zuckerberg's attempt to strong arm Hawaiians was merely an attempt to follow the example of Ted Turner, after all), and the way Tyson destroyed whole segments of the market, crops are a large lever. Used to be crops and equipment, but John Deere has done its best to make farmers captives as well. But no, they don't exist (except to pay outrageous tuition to ag and vo-tech colleges) and MODERN Americans eat food that springs magically into existence in Trader Joe's. Bah, a plague on their houses. /sarc

Maybe the student loan debtors should start picketing the home of that Democratic hero, Joe Biden. Or take a look at just why post grad tuition has skyrocketed.

Grumpy Engineer , June 1, 2017 at 10:57 am

Why has post-graduate tuition skyrocketed? Because federal loan limits for graduate school are higher:

$57,500 for undergraduates and $138,500 for graduate or professional students, per https://studentaid.ed.gov/sa/types/loans/subsidized-unsubsidized .

The objective of this game is for schools to extract as much money as possible from the government, with the students being held responsible for paying it back. Higher loan limits are the cause of higher tuition rates, not the effect.

diptherio , June 1, 2017 at 11:21 am

Being from MT and a (one-time) ag family, I hear you on the issue of farmer indebtedness that is a serious problem, as it always has been. I've been hearing forever about the realities of farming - go into debt during planting and hope you get enough at harvest to pay it off and still have a little left over to live on.

However, as you point out, land consolidation by the likes of Cargill and their ilk has greatly reduced the number of family farms and the amount of family farm debt along with it. Total student loan debt right now is over $1.4T, whereas total ag debt is only $395B i.e. there is 4 times as much student loan debt as ag debt.

I'm pretty sure that Hudson wasn't trying to downplay the plight of family farmers in this country, or the crushing amounts of debt that they, individually, often end up taking on. I think he's just pointing out that on the macro-level, student debt has become the main contributor to overall indebtedness (along with mortgages).

Allegorio , June 1, 2017 at 12:49 pm

Not that all that money goes to hiring teaching staff. The majority of courses are taught by poorly paid adjutants and grad students. There is however an ever burgeoning class of college administrators all with six figure incomes pensions and medical care. It is jobs program for the well connected and ethnically privileged. Try getting a job at a university, not if you don't know somebody. The level of corruption at universities is truly astounding. I guess it is par for the course in our mafia culture. Free tuition would certainly increase pressure on cleansing the Stygian Stables, but until the electoral system is reformed and publicly financed there can be no reform of our education system. Finally, I second the emotion, may Joe Biden rot in hell.

shinola , June 1, 2017 at 10:39 am

I am reminded of an old coal miners song:

Ya load 16 tons and what do ya get
Another day older and deeper in debt
St. Peter don't ya call me 'cause I can't go
I owe my soul to the company store

Off The Street , June 1, 2017 at 7:59 pm

I came across the term leet-man the other day. That was in reference to John Locke, yes, that John Locke . He used the term in reference to his work on the South Carolina constitution of a few centuries ago. That was a bad idea then, and has gotten worse in the current context.
Meet the new boss, same as the old boss.

Locke's preamble stated: "that we may avoid erecting a numerous democracy;" Locke's "constitution" established the eight lords proprietors as a hereditary nobility, with absolute control over their serfs, called "leet-men":

"XIX: Any lord of a manor may alienate, sell, or dispose to any other person and his heirs forever, his manor, all entirely together, with all the privileges and leet-men there unto belonging .

"XXII: In every signory, barony and manor, all the leet-men shall be under the jurisdiction of the respective lords of the said signory, barony, or manor, without appeal from him. Nor shall any leet-man, or leet-woman, have liberty to go off from the land of their particular lord, and live anywhere else, without license from their said lord, under hand and seal.

"XXIII: All the children of leet-men shall be leet-men, and so to all generations."

Jesper , June 1, 2017 at 10:42 am

& the risk versus reward is completely skewed . The risk of default is (should be) based on the best credit rating of the borrower or the guarantor. In this case it seems that the risk premium is based on the worst credit rating so difference between risk and reward is completely off.
Personally I'd never ever guarantee someone elses debt – I'd rather borrow the money and lend it myself to whoever wanted me to be guarantor as in effect the risk would be the same as being a guarantor and the costs would be less as the middle man would be cut out.
Therefore I consider this:

banks insisted that the government guarantee all student debt

an unsurprising ask by banks but agreeing to it is idiocy. "Yes we can" does (or should not) mean saying yes to everything
https://en.wikipedia.org/wiki/Barack_Obama_presidential_campaign,_2008#Slogan

Grumpy Engineer , June 1, 2017 at 11:08 am

Aye. Saying "yes" to somebody who wants to borrow $120k for a masters in "motivational speaking" from a crappy knockoff of Trump University isn't exactly doing them a favor. But the US government will do it anyway. They pretty much say "yes" to everything when it comes to student borrowing, regardless of how likely it is that the student will be able to repay.

Assessing a potential borrower's ability to repay (a.k.a., underwriting) and sometimes saying "no" is an important part of lending. Keeps people from getting in over their heads. Well, it used to be. Nobody seems to bother these days. Especially the US government.

Allegorio , June 1, 2017 at 12:53 pm

The point being that the banks and the government want people to get in over their heads to feed the beast and to marginalize them with debt.

PhilM , June 1, 2017 at 6:44 pm

There's another way to look at it. If the government takes on all this debt, then forgives it, hasn't it given a tuition-free education "by the back door"? This could have been an outrageously ingenious move by Obama to slide free education in via the MMT back door.

Yves Smith Post author , June 1, 2017 at 7:20 pm

Coming off as an ideologue isn't a way to persuade people.

No one here likes making students borrow to pay for education. Even the Fed has found tuition subsides will lower default rates. But you don't get what the objective is. It is ostensibly to get more people educated, which of course allows for the continued inflation of college costs.

The Fed article pointed the issue of what the apparent real aims are:

Our results suggest that if the goal of education policy is to improve aggregate welfare, then merit-based tuition subsidies are preferable to both need-based subsidies and higher government borrowing limits, as merit-based subsidies promote college investment without increasing default rates in the student loan market. However, if the goal is to deliver high college enrollment rates, then need-based subsidies are preferable to merit-based subsidies and higher government borrowing limits, but come at the cost of higher default rates on student loans.

https://www.federalreserve.gov/pubs/feds/2014/201466/201466pap.pdf

And the payoff to having a degree is even higher than before given rising income inequality (one of my buddies was just at an investment conference where this was a prominent point made). So if you can't get a college education, you will be left out of what is left of the middle class. But one of many problems is only something like 57% of the students complete their degrees even in 6 years.

http://www.latimes.com/opinion/op-ed/la-oe-mcpherson-complete-college-20160822-snap-story.html

jerry , June 1, 2017 at 10:48 am

Any bankruptcy attorneys out there who can give me a good reason not to declare chapter 7 with 10-15k in unsecured debt, low income, and no medium term (5-10 years) prospects of needing a good credit score? Seems like the only tool left in the toolkit for us wage slaves these days?

LT , June 1, 2017 at 12:07 pm

In the 90s, a radio promotion man from a music label was the first person to explain the the sharecropper analogy to me during a discussion about recording artist contracts. And the internet (or the information people give in service of it) has not changed the dynamic in music or any other industry because it concentrated power and made creditors and credit reporting agencies more powerful.

WeakenedSquire , June 1, 2017 at 12:46 pm

A student loan debt is literally a claim against a life - you cannot discharge it in bankruptcy, and if you die, your parents are obligated to pay it.

No. The second half of that is a flat-out wrong statement. Student loans are discharged upon the borrower's death. Every time I read Hudson, I find myself incredibly frustrated that a man of such brilliance resorts to lazy and hyperbolic exaggerations to make a point when there is no bloody need to do so. Reality is grotesque enough.

JustAnObserver , June 1, 2017 at 1:40 pm

Perhaps Michael Hudson is – somewhat sloppily – referring to the IIRC typical case where getting the loan requires someone to sign on as guarantor, normally the student's parents.

Q for those who know: Am I right in thinking this ?

nycTerrierist , June 1, 2017 at 12:48 pm

As if it isn't bad enough, enter Betsy Devos:

http://www.slate.com/blogs/moneybox/2017/04/18/betsy_devos_is_wasting_no_time_screwing_over_student_borrowers.html

http://www.prwatch.org/news/2017/01/13207/betsy-devos-ethics-report-reveals-ties-student-debt-collection-firm

Gordon , June 1, 2017 at 12:50 pm

Here in the UK today's undergraduates are graduating with a debt in the high £40ks. That is getting on for twice the per capita national debt (around £27k if memory serves) so, given that about half now go to university, that will in time nearly double the national debt – except it will have been privatised so that's ok (/sarc).

Actually, it's not ok. After buying or renting (mostly renting) ridiculously expensive houses and paying off their student loans, today's graduates will not/cannot possibly generate enough economic surplus to pay the pensions of their parents. Somehow/sometime this is going to break.

Wisdom Seeker , June 1, 2017 at 3:16 pm

One aspect of this needs additional consideration: one person's debt is another person's asset. But whose asset? Blaming "rentiers" is insufficiently precise; we ought to know who lent the money. Demand for "bonds" comes from many sources, including retiree pensions, 401Ks, and so on.

Most of the student loans are federally guaranteed, but are the principal and interest payments actually going to Uncle Sam, or to Sallie Mae bond tranche owners? Are the boomers – at least those with pensions and 401ks – enslaving students through their ravenous demand for income-producing assets to fund their retirements?

Most people are blindly funding "life cycle" retirement funds, not realizing that those very "investments" are enabling all the behavior they decry as exploitative. The huge national debt, student loan, housing and auto loan bubbles are all funded by people who think of themselves as "investors", but are actually ENABLERS.

I fear the abuses won't end until people wake up and realize that their 401K retirement fund is abetting all the evils they abhor, and start demanding better investment options. But many simply won't care, and the finance industry will fight tooth and claw to prevent reform of their gravy train

P.S. In past years, when I searched I was not able to easily find a single bond mutual fund or ETF of any size that doesn't fund either the national debt, the TBTF banks, the housing, student loan or auto bubbles. One would think there would be some funds investing in bonds issued by non financial productive corporations; are there any? I would give good coin to a 401K or IRA-compatible fund or ETF which indexed non-financial corporate bonds, especially if it used a socially-responsible overlay to screen out the other forms of corporate abuse (monopolies, pollution, slave-labor practices etc.).

bob , June 1, 2017 at 7:43 pm

Are the boomers – at least those with pensions and 401ks – enslaving students through their ravenous demand for income-producing assets to fund their retirements?

– YES –

VietnamVet , June 1, 2017 at 7:08 pm

Two industries not yet outsourced are education and healthcare. Rural college towns are the only oases of prosperity in mid-America. This article explains why. All the money being spent there is coming from the student's future earnings. It is unsustainable. The percentage of middle class families have fallen from 62% in 1970 to 43% in 2014. This is why government took over student loans. To keep the scam going. Debt that can't be paid back won't be. Healthcare has likewise been finanicizlized. Housing is well into its second bubble blown in part by Chinese flight capital. Something will pop. The prick could be as simple as a successful soft coup by the global media and the intelligence community that forces Donald J Trump to resign.

[Jun 21, 2017] Neoliberalism and opioids abuse

Jun 21, 2017 | economistsview.typepad.com

libezkova, June 21, 2017 at 07:25 PM

Over 33K people in US died of opiates overdoses in 2015 according to the Centers for Disease Control and Prevention.

Not only unemployed abuse opioids, but more and more college students and recent graduates are abusing the opioids as well, according to a survey of 1200 college aged adults commissioned the same year by Christie foundation.

Federal law does not require colleges to report drug death unless they are deemed criminal. But fatal overdoses have been rising at schools nationwide underscoring and horrifying reality of for administrators: in addition to binge drinking and marijuana, they have another crisis firmly entrenched on campus.

Now losing 30K people in one year is like small scale civil war (like the one they have in Ukraine) and in a way it is: war of wealthy and medical industrial complex against those in difficult circumstances, with dreams crashed and, especially, unemployed.

https://www.usnews.com/news/news/articles/2016-06-14/opioids-linked-with-deaths-other-than-overdoses-study-says

== quote ==

CHICAGO (AP) - Accidental overdoses aren't the only deadly risk from using powerful prescription painkillers - the drugs may also contribute to heart-related deaths and other fatalities, new research suggests.

Among more than 45,000 patients in the study, those using opioid painkillers had a 64 percent higher risk of dying within six months of starting treatment compared to patients taking other prescription pain medicine. Unintentional overdoses accounted for about 18 percent of the deaths among opioid users, versus 8 percent of the other patients.

"As bad as people think the problem of opioid use is, it's probably worse," said Wayne Ray, the lead author and a health policy professor at Vanderbilt University's medical school. "They should be a last resort and particular care should be exercised for patients who are at cardiovascular risk."

His caution echoes recent advice from the Centers for Disease Control and Prevention, trying to stem the nation's opioid epidemic. The problem includes abuse of street drugs like heroin and overuse of prescription opioids such as hydrocodone, codeine and morphine.

The drugs can slow breathing and can worsen disrupted breathing that occurs with sleep apnea, potentially leading to irregular heartbeats, heart attacks or sudden death, the study authors said.

In 2014, there were more than 14,000 fatal overdoses linked with the painkillers in the U.S. The study suggests even more have died from causes linked with the drugs, and bolster evidence in previous research linking them with heart problems.

The study involved more than 45,000 adult Medicaid patients in Tennessee from 1999 to 2012. They were prescribed drugs for chronic pain not caused by cancer but from other ailments including persistent backaches and arthritis.

Half received long-acting opioids including controlled-release oxycodone, methadone and fentanyl skin patches. Fentanyl has been implicated in the April death of Prince, although whether the singer was using a fentanyl patch, pills or other form of the drug hasn't been publicly revealed.

Long-acting opioids remain in the body longer. The study authors noted that the body's prolonged exposure to the drugs may increase risks for toxic reactions.

The remaining study patients had prescriptions for non-opioid drugs sometimes used to treat nerve pain, including gabapentin; or certain antidepressants also used for pain.

There were 185 deaths among opioid users, versus 87 among other patients. The researchers calculated that for every 145 patients on an opioid drug, there was one excess death versus deaths among those on other painkillers.

The two groups were similar in age, medical conditions, risks for heart problems and other characteristics that could have contributed to the outcomes.

The results were published Tuesday in the Journal of the American Medical Association .

The study involved only Medicaid patients, who include low-income and disabled adults and who are among groups disproportionately affected by opioid abuse.

Ray noted that the study excluded the sickest patients and those with any evidence of drug abuse. He said similar results would likely be found in other groups.

Dr. Chad Brummett, director of pain research at the University of Michigan Health System, said the study highlights risks from the drugs in a novel way and underscores why their use should be limited.

[Jun 17, 2017] The Collapsing Social Contract by Gaius Publius

Highly recommended!
Notable quotes:
"... Until elites stand down and stop the brutal squeeze , expect more after painful more of this. It's what happens when societies come apart. Unless elites (of both parties) stop the push for "profit before people," policies that dominate the whole of the Neoliberal Era , there are only two outcomes for a nation on this track, each worse than the other. There are only two directions for an increasingly chaotic state to go, chaotic collapse or sufficiently militarized "order" to entirely suppress it. ..."
"... Mes petits sous, mon petit cri de coeur. ..."
"... But the elite aren't going to stand down, whatever that might mean. The elite aren't really the "elite", they are owners and controllers of certain flows of economic activity. We need to call it what it is and actively organize against it. Publius's essay seems too passive at points, too passive voice. (Yes, it's a cry from the heart in a prophetic mode, and on that level, I'm with it.) ..."
"... American Psycho ..."
"... The college students I deal with have internalized a lot of this. In their minds, TINA is reality. Everything balances for the individual on a razor's edge of failure of will or knowledge or hacktivity. It's all personal, almost never collective - it's a failure toward parents or peers or, even more grandly, what success means in America. ..."
"... unions don't matter in our TINA. Corporations do. ..."
"... our system promotes specialists and disregards generalists this leads to a population of individualists who can't see the big picture. ..."
"... That social contract is hard to pin down and define – probably has different meanings to all of us, but you are right, it is breaking down. We no longer feel that our governments are working for us. ..."
"... Increasing population, decreasing resources, increasingly expensive remaining resources on a per unit basis, unresolved trashing of the environment and an political economy that forces people to do more with less all the time (productivity improvement is mandatory, not optional, to handle the exponential function) much pain will happen even if everyone is equal. ..."
"... "Social contract:" nice Enlightment construct, out of University by City. Not a real thing, just a very incomplete shorthand to attempt to fiddle the masses and give a name to meta-livability. ..."
"... Always with the "contract" meme, as if there are no more durable and substantive notions of how humans in small and large groups might organize and interact Or maybe the notion is the best that can be achieved? ..."
"... JTMcFee, you have provided the most important aspect to this mirage of 'social contract'. The "remedies" clearly available to lawless legislation rest outside the realm of a contract which has never existed. ..."
"... Unconscionable clauses are now separately initialed in an "I dare you to sue me" shaming gambit. Meanwhile the mythical Social Contract has been atomized into 7 1/2 billion personal contracts with unstated, shifting remedies wholly tied to the depths of pockets. ..."
"... Here in oh-so-individualistic Chicago, I have been noting the fraying for some time: It isn't just the massacres in the highly segregated black neighborhoods, some of which are now in terminal decline as the inhabitants, justifiably, flee. The typical Chicagoan wanders the streets connected to a phone, so as to avoid eye contact, all the while dressed in what look like castoffs. Meanwhile, Midwesterners, who tend to be heavy, are advertisements for the obesity epidemic: Yet obesity has a metaphorical meaning as the coat of lipids that a person wears to keep the world away. ..."
"... My middle / upper-middle neighborhood is covered with a layer of upper-middle trash: Think Starbucks cups and artisanal beer bottles. ..."
"... The class war continues, and the upper class has won. As commenter relstprof notes, any kind of concerted action is now nearly impossible. Instead of the term "social contract," I might substitute "solidarity." Is there solidarity? No, solidarity was destroyed as a policy of the Reagan administration, as well as by fantasies that Americans are individualistic, and here we are, 40 years later, dealing with the rubble of the Obama administration and the Trump administration. ..."
"... The trash bit has been linked in other countries to how much the general population views the public space/environment as a shared, common good. Thus, streets, parks and public space might be soiled by litter that nobody cares to put away in trash bins properly, while simultaneously the interior of houses/apartments, and attached gardens if any, are kept meticulously clean. ..."
"... The trash bit has been linked in other countries to how much the general population views the public space/environment as a shared, common good. ..."
"... There *is* no public space anymore. Every public good, every public space is now fair game for commercial exploitation. ..."
"... The importance of the end of solidarity – that is, of the almost-murderous impulses by the upper classes to destroy any kind of solidarity. ..."
"... "Conditions will only deteriorate for anyone not in the "1%", with no sight of improvement or relief." ..."
"... "Four Futures" ..."
"... Reminds me of that one quip I saw from a guy who, why he always had to have two pigs to eat up his garbage, said that if he had only one pig, it will eat only when it wants to, but if there were two pigs, each one would eat so the other pig won't get to it first. Our current economic system in a nutshell – pigs eating crap so deny it to others first. "Greed is good". ..."
"... Don't know that the two avenues Gaius mentioned are the only two roads our society can travel. In support of this view, I recall a visit to a secondary city in Russia for a few weeks in the early 1990s after the collapse of the USSR. Those were difficult times economically and psychologically for ordinary citizens of that country. Alcoholism was rampant, emotional illness and suicide rates among men of working age were high, mortality rates generally were rising sharply, and birth rates were falling. Yet the glue of common culture, sovereign currency, language, community, and thoughtful and educated citizens held despite corrupt political leadership, the rise of an oligarchic class, and the related emergence of organized criminal networks. There was also adequate food, and critical public infrastructure was maintained, keeping in mind this was shortly after the Chernobyl disaster. ..."
Jun 16, 2017 | www.nakedcapitalism.com
Yves here. I have been saying for some years that I did not think we would see a revolution, but more and more individuals acting out violently. That's partly the result of how community and social bonds have weakened as a result of neoliberalism but also because the officialdom has effective ways of blocking protests. With the overwhelming majority of people using smartphones, they are constantly surveilled. And the coordinated 17-city paramilitary crackdown on Occupy Wall Street shows how the officialdom moved against non-violent protests. Police have gotten only more military surplus toys since then, and crowd-dispersion technology like sound cannons only continues to advance. The only way a rebellion could succeed would be for it to be truly mass scale (as in over a million people in a single city) or by targeting crucial infrastructure.

By Gaius Publius , a professional writer living on the West Coast of the United States and frequent contributor to DownWithTyranny, digby, Truthout, and Naked Capitalism. Follow him on Twitter @Gaius_Publius , Tumblr and Facebook . GP article archive here . Originally published at DownWithTyranny

"[T]he super-rich are absconding with our wealth, and the plague of inequality continues to grow. An analysis of 2016 data found that the poorest five deciles of the world population own about $410 billion in total wealth. As of June 8, 2017 , the world's richest five men owned over $400 billion in wealth. Thus, on average, each man owns nearly as much as 750 million people."
-Paul Buchheit, Alternet

"Congressman Steve Scalise, Three Others Shot at Alexandria, Virginia, Baseball Field"
-NBC News, June 14, 2017

"4 killed, including gunman, in shooting at UPS facility in San Francisco"
-ABC7News, June 14, 2017

"Seriously? Another multiple shooting? So many guns. So many nut-bars. So many angry nut-bars with guns."
-MarianneW via Twitter

"We live in a world where "multiple dead" in San Francisco shooting can't cut through the news of another shooting in the same day."
-SamT via Twitter

"If the rich are determined to extract the last drop of blood, expect the victims to put up a fuss. And don't expect that fuss to be pretty. I'm not arguing for social war; I'm arguing for justice and peace."
- Yours truly

When the social contract breaks from above, it breaks from below as well.

Until elites stand down and stop the brutal squeeze , expect more after painful more of this. It's what happens when societies come apart. Unless elites (of both parties) stop the push for "profit before people," policies that dominate the whole of the Neoliberal Era , there are only two outcomes for a nation on this track, each worse than the other. There are only two directions for an increasingly chaotic state to go, chaotic collapse or sufficiently militarized "order" to entirely suppress it.

As with the climate, I'm concerned about the short term for sure - the storm that kills this year, the hurricane that kills the next - but I'm also concerned about the longer term as well. If the beatings from "our betters" won't stop until our acceptance of their "serve the rich" policies improves, the beatings will never stop, and both sides will take up the cudgel.

Then where will we be?

America's Most Abundant Manufactured Product May Be Pain

I look out the window and see more and more homeless people, noticeably more than last year and the year before. And they're noticeably scruffier, less "kemp,"​ if that makes sense to you (it does if you live, as I do, in a community that includes a number of them as neighbors).

The squeeze hasn't let up, and those getting squeezed out of society have nowhere to drain to but down - physically, economically, emotionally. The Case-Deaton study speaks volumes to this point. The less fortunate economically are already dying of drugs and despair. If people are killing themselves in increasing numbers, isn't it just remotely maybe possible they'll also aim their anger out as well?

The pot isn't boiling yet - these shootings are random, individualized - but they seem to be piling on top of each other. A hard-boiling, over-flowing pot may not be far behind. That's concerning as well, much moreso than even the random horrid events we recoil at today.

Many More Ways Than One to Be a Denier

My comparison above to the climate problem was deliberate. It's not just the occasional storms we see that matter. It's also that, seen over time, those storms are increasing, marking a trend that matters even more. As with climate, the whole can indeed be greater than its parts. There's more than one way in which to be a denier of change.

These are not just metaphors. The country is already in a pre-revolutionary state ; that's one huge reason people chose Trump over Clinton, and would have chosen Sanders over Trump. The Big Squeeze has to stop, or this will be just the beginning of a long and painful path. We're on a track that nations we have watched - tightly "ordered" states, highly chaotic ones - have trod already. While we look at them in pity, their example stares back at us.

Mes petits sous, mon petit cri de coeur.

elstprof , June 16, 2017 at 3:03 am

But the elite aren't going to stand down, whatever that might mean. The elite aren't really the "elite", they are owners and controllers of certain flows of economic activity. We need to call it what it is and actively organize against it. Publius's essay seems too passive at points, too passive voice. (Yes, it's a cry from the heart in a prophetic mode, and on that level, I'm with it.)

"If people are killing themselves in increasing numbers, isn't it just remotely maybe possible they'll also aim their anger out as well?"

Not necessarily. What Lacan called the "Big Other" is quite powerful. We internalize a lot of socio-economic junk from our cultural inheritance, especially as it's been configured over the last 40 years - our values, our body images, our criteria for judgment, our sense of what material well-being consists, etc. Ellis's American Psycho is the great satire of our time, and this time is not quite over yet. Dismemberment reigns.

The college students I deal with have internalized a lot of this. In their minds, TINA is reality. Everything balances for the individual on a razor's edge of failure of will or knowledge or hacktivity. It's all personal, almost never collective - it's a failure toward parents or peers or, even more grandly, what success means in America.

The idea that agency could be a collective action of a union for a strike isn't even on the horizon. And at the same time, these same students don't bat an eye at socialism. They're willing to listen.

But unions don't matter in our TINA. Corporations do.

Moneta , June 16, 2017 at 8:08 am

Most of the elite do not understand the money system. They do not understand how different sectors have benefitted from policies and/or subsidies that increased the money flows into these. So they think they deserve their money more than those who toiled in sectors with less support.

Furthermore, our system promotes specialists and disregards generalists this leads to a population of individualists who can't see the big picture.

jefemt , June 16, 2017 at 9:45 am

BAU, TINA, BAU!! BOHICA!!!

Dead Dog , June 16, 2017 at 3:09 am

Thank you Gaius, a thoughtful post. That social contract is hard to pin down and define – probably has different meanings to all of us, but you are right, it is breaking down. We no longer feel that our governments are working for us.

Of tangential interest, Turnbull has just announced another gun amnesty targeting guns that people no longer need and a tightening of some of the ownership laws.

RWood , June 16, 2017 at 12:24 pm

So this inheritance matures: http://www.nature.com/news/fight-the-silencing-of-gun-research-1.22139

willem , June 16, 2017 at 2:20 pm

One problem is the use of the term "social contract", implying that there is some kind of agreement ( = consensus) on what that is. I don't remember signing any "contract".

Fiery Hunt , June 16, 2017 at 3:17 am

I fear for my friends, I fear for my family. They do not know how ravenous the hounds behind nor ahead are. For myself? I imagine myself the same in a Mad Max world. It will be more clear, and perception shattering, to most whose lives allow the ignoring of gradual chokeholds, be them political or economic, but those of us who struggle daily, yearly, decadely with both, will only say Welcome to the party, pals.

Disturbed Voter , June 16, 2017 at 6:33 am

Increasing population, decreasing resources, increasingly expensive remaining resources on a per unit basis, unresolved trashing of the environment and an political economy that forces people to do more with less all the time (productivity improvement is mandatory, not optional, to handle the exponential function) much pain will happen even if everyone is equal.

Each person does what is right in their own eyes, but the net effect is impoverishment and destruction. Life is unfair, indeed. A social contract is a mutual suicide pact, whether you renegotiate it or not. This is Fight Club. The first rule of Fight Club, is we don't speak of Fight Club. Go to the gym, toughen up, while you still can.

JTMcPhee , June 16, 2017 at 6:44 am

"Social contract:" nice Enlightment construct, out of University by City. Not a real thing, just a very incomplete shorthand to attempt to fiddle the masses and give a name to meta-livability.

Always with the "contract" meme, as if there are no more durable and substantive notions of how humans in small and large groups might organize and interact Or maybe the notion is the best that can be achieved? Recalling that as my Contracts professor in law school emphasized over and over, in "contracts" there are no rights in the absence of effective remedies. It being a Boston law school, the notion was echoed in Torts, and in Commercial Paper and Sales and, tellingly, in Constitutional Law and Federal Jurisdiction, and even in Criminal Law and Criminal Procedure. No remedy, no right. What remedies are there in "the system," for the "other halves" of the "social contract," the "have-naught" halves?

When honest "remedies under law" become nugatory, there's always the recourse to direct action of course with zero guarantee of redress

sierra7 , June 16, 2017 at 11:22 am

"What remedies are there in "the system," for the "other halves" of the "social contract," the "have-naught" halves?" Ah yes the ultimate remedy is outright rebellion against the highest authorities .with as you say, " zero guarantee of redress."

But, history teaches us that that path will be taken ..the streets. It doesn't (didn't) take a genius to see what was coming back in the late 1960's on .regarding the beginnings of the revolt(s) by big money against organized labor. Having been very involved in observing, studying and actually active in certain groups back then, the US was acting out in other countries particularly in the Southern Hemisphere, against any social progression, repressing, arresting (thru its surrogates) torturing, killing any individuals or groups that opposed that infamous theory of "free market capitalism". It had a very definite "creep" effect, northwards to the mainstream US because so many of our major corporations were deeply involved with our covert intelligence operatives and objectives (along with USAID and NED). I used to tell my friends about what was happening and they would look at me as if I was a lunatic. The agency for change would be "organized labor", but now, today that agency has been trashed enough where so many of the young have no clue as to what it all means. The ultimate agenda along with "globalization" is the complete repression of any opposition to the " spread of money markets" around the world". The US intends to lead; whether the US citizenry does is another matter. Hence the streets.

Kuhio Kane , June 16, 2017 at 12:33 pm

JTMcFee, you have provided the most important aspect to this mirage of 'social contract'. The "remedies" clearly available to lawless legislation rest outside the realm of a contract which has never existed.

bdy , June 16, 2017 at 1:32 pm

The Social Contract, ephemeral, reflects perfectly what contracts have become. Older rulings frequently labeled clauses unconscionable - a tacit recognition that so few of the darn things are actually agreed upon. Rather, a party with resources, options and security imposes the agreement on a party in some form of crisis (nowadays the ever present crisis of paycheck to paycheck living – or worse). Never mind informational asymmetries, necessity drives us into crappy rental agreements and debt promises with eyes wide open. And suddenly we're all agents of the state.

Unconscionable clauses are now separately initialed in an "I dare you to sue me" shaming gambit. Meanwhile the mythical Social Contract has been atomized into 7 1/2 billion personal contracts with unstated, shifting remedies wholly tied to the depths of pockets.

Solidarity, of course. Hard when Identity politics lubricate a labor market that insists on specialization, and talented children of privilege somehow manage to navigate the new entrepreneurism while talented others look on in frustration. The resistance insists on being leaderless (fueled in part IMHO by the uncomfortable fact that effective leaders are regularly killed or co-opted). And the overriding message of resistance is negative: "Stop it!"

But that's where we are. Again, just my opinion: but the pivotal step away from the jackpot is to convince or coerce our wealthiest not to cash in. Stop making and saving so much stinking money, y'all.

Moneta , June 16, 2017 at 6:54 am

The pension system is based on profits. Nothing will change until the profits disappear and the top quintile starts falling off the treadmill.

Susan the other , June 16, 2017 at 1:01 pm

and there's the Karma bec. even now we see a private banking system synthesizing an economy to maintain asset values and profits and they have the nerve to blame it on social spending. I think Giaus's term 'Denier' is perfect for all those vested practitioners of profit-capitalism at any cost. They've already failed miserably. For the most part they're just too proud to admit it and, naturally, they wanna hang on to "their" money. I don't think it will take a revolution – in fact it would be better if no chaos ensued – just let these arrogant goofballs stew in their own juice a while longer. They are killing themselves.

roadrider , June 16, 2017 at 8:33 am

There's a social contract? Who knew?

Realist , June 16, 2017 at 8:41 am

When I hear so much impatient and irritable complaint, so much readiness to replace what we have by guardians for us all, those supermen, evoked somewhere from the clouds, whom none have seen and none are ready to name, I lapse into a dream, as it were. I see children playing on the grass; their voices are shrill and discordant as children's are; they are restive and quarrelsome; they cannot agree to any common plan; their play annoys them; it goes poorly. And one says, let us make Jack the master; Jack knows all about it; Jack will tell us what each is to do and we shall all agree. But Jack is like all the rest; Helen is discontented with her part and Henry with his, and soon they fall again into their old state. No, the children must learn to play by themselves; there is no Jack the master. And in the end slowly and with infinite disappointment they do learn a little; they learn to forbear, to reckon with another, accept a little where they wanted much, to live and let live, to yield when they must yield; perhaps, we may hope, not to take all they can. But the condition is that they shall be willing at least to listen to one another, to get the habit of pooling their wishes. Somehow or other they must do this, if the play is to go on; maybe it will not, but there is no Jack, in or out of the box, who can come to straighten the game. -Learned Hand

DJG , June 16, 2017 at 9:24 am

Here in oh-so-individualistic Chicago, I have been noting the fraying for some time: It isn't just the massacres in the highly segregated black neighborhoods, some of which are now in terminal decline as the inhabitants, justifiably, flee. The typical Chicagoan wanders the streets connected to a phone, so as to avoid eye contact, all the while dressed in what look like castoffs. Meanwhile, Midwesterners, who tend to be heavy, are advertisements for the obesity epidemic: Yet obesity has a metaphorical meaning as the coat of lipids that a person wears to keep the world away.

My middle / upper-middle neighborhood is covered with a layer of upper-middle trash: Think Starbucks cups and artisanal beer bottles. Some trash is carefully posed: Cups with straws on windsills, awaiting the Paris Agreement Pixie, who will clean up after these oh-so-earnest environmentalists.

Meanwhile, I just got a message from my car-share service: They are cutting back on the number of cars on offer. Too much vandalism.

Are these things caused by pressure from above? Yes, in part: The class war continues, and the upper class has won. As commenter relstprof notes, any kind of concerted action is now nearly impossible. Instead of the term "social contract," I might substitute "solidarity." Is there solidarity? No, solidarity was destroyed as a policy of the Reagan administration, as well as by fantasies that Americans are individualistic, and here we are, 40 years later, dealing with the rubble of the Obama administration and the Trump administration.

JEHR , June 16, 2017 at 11:17 am

DJG: My middle / upper-middle neighborhood is covered with a layer of upper-middle trash: Think Starbucks cups and artisanal beer bottles. Some trash is carefully posed: Cups with straws on windsills, awaiting the Paris Agreement Pixie, who will clean up after these oh-so-earnest environmentalists.

Yes, the trash bit is hard to understand. What does it stand for? Does it mean, We can infinitely disregard our surroundings by throwing away plastic, cardboard, metal and paper and nothing will happen? Does it mean, There is more where that came from! Does it mean, I don't care a fig for the earth? Does it mean, Human beings are stupid and, unlike pigs, mess up their immediate environment and move on? Does it mean, Nothing–that we are just nihilists waiting to die? I am so fed up with the garbage strewn on the roads and in the woods where I live; I used to pick it up and could collect as much as 9 garbage bags of junk in 9 days during a 4 kilometer walk. I don't pick up any more because I am 77 and cannot keep doing it.

However, I am certain that strewn garbage will surely be the last national flag waving in the breeze as the anthem plays junk music and we all succumb to our terrible future.

jrs , June 16, 2017 at 1:09 pm

Related to this, I thought one day of who probably NEVER gets any appreciation but strives to make things nicer, anyone planning or planting the highway strips (government workers maybe although it could be convicts also unfortunately, I'm not sure). Yes highways are ugly, yes they will destroy the world, but some of the planting strips are sometimes genuinely nice. So they add some niceness to the ugly and people still litter of course.

visitor , June 16, 2017 at 1:04 pm

The trash bit has been linked in other countries to how much the general population views the public space/environment as a shared, common good. Thus, streets, parks and public space might be soiled by litter that nobody cares to put away in trash bins properly, while simultaneously the interior of houses/apartments, and attached gardens if any, are kept meticulously clean.

Basically, the world people care about stops outside their dwellings, because they do not feel it is "theirs" or that they participate in its possession in a genuine way. It belongs to the "town administration", or to a "private corporation", or to the "government" - and if they feel they have no say in the ownership, management, regulation and benefits thereof, why should they care? Let the town administration/government/corporation do the clean-up - we already pay enough taxes/fees/tolls, and "they" are always putting up more restrictions on how to use everything, so

In conclusion: the phenomenon of litter/trash is another manifestation of a fraying social contract.

Big River Bandido , June 16, 2017 at 1:47 pm

The trash bit has been linked in other countries to how much the general population views the public space/environment as a shared, common good.

There *is* no public space anymore. Every public good, every public space is now fair game for commercial exploitation.

I live in NYC, and just yesterday as I attempted to refill my MetroCard, the machine told me it was expired and I had to replace it. The replacement card doesn't look at all like a MetroCard with the familiar yellow and black graphic saying "MetroCard". Instead? It's an ad. For a fucking insurance company. And so now, every single time that I go somewhere on the subway, I have to see an ad from Empire Blue Cross/Blue Shield.

visitor , June 16, 2017 at 2:39 pm

There *is* no public space anymore. Every public good, every public space is now fair game for commercial exploitation.

And as a result, people no longer care about it - they do not feel it is their commonwealth any longer.

Did you notice whether the NYC subway got increasingly dirty/littered as the tentacles of privatization reached everywhere? Just curious.

DJG , June 16, 2017 at 9:37 am

The importance of the end of solidarity – that is, of the almost-murderous impulses by the upper classes to destroy any kind of solidarity. From Yves's posting of Yanis Varoufakis's analysis of the newest terms of the continuing destruction of Greece:

With regard to labour market reforms, the Eurogroup welcomes the adopted legislation safeguarding previous reforms on collective bargaining and bringing collective dismissals in line with best EU practices.

I see! "Safeguarding previous reforms on collective bargaining" refers, of course, to the 2012 removal of the right to collective bargaining and the end to trades union representation for each and every Greek worker. Our government was elected in January 2015 with an express mandate to restore these workers' and trades unions' rights. Prime Minister Tsipras has repeatedly pledged to do so, even after our falling out and my resignation in July 2015. Now, yesterday, his government consented to this piece of Eurogroup triumphalism that celebrates the 'safeguarding' of the 2012 'reforms'. In short, the SYRIZA government has capitulated on this issue too: Workers' and trades' unions' rights will not be restored. And, as if that were not bad enough, "collective dismissals" will be brought "in line with best EU practices". What this means is that the last remaining constraints on corporations, i.e. a restriction on what percentage of workers can be fired each month, is relaxed. Make no mistake: The Eurogroup is telling us that, now that employers are guaranteed the absence of trades unions, and the right to fire more workers, growth enhancement will follow suit! Let's not hold our breath!

Daniel F. , June 16, 2017 at 10:44 am

The so-called "Elites"? Stand down? Right. Every year I look up the cardinal topics discussed at the larger economic forums and conferences (mainly Davos and G8), and some variation of "The consequences of rising inequality" is a recurring one. Despite this, nothing ever comes out if them. I imagine they go something like this:

A wet dream come true, both for an AnCap and a communist conspiracy theorist. I'm by no means either. However, I think capitalism has already failed and can't go on for much longer. Conditions will only deteriorate for anyone not in the "1%", with no sight of improvement or relief.

I'd very much like to be proven wrong.

Bobby Gladd , June 16, 2017 at 12:01 pm

"Conditions will only deteriorate for anyone not in the "1%", with no sight of improvement or relief." Frase's Quadrant Four. Hierarchy + Scarcity = Exterminism (From "Four Futures" )

Archangel , June 16, 2017 at 11:33 am

Reminds me of that one quip I saw from a guy who, why he always had to have two pigs to eat up his garbage, said that if he had only one pig, it will eat only when it wants to, but if there were two pigs, each one would eat so the other pig won't get to it first. Our current economic system in a nutshell – pigs eating crap so deny it to others first. "Greed is good".

oh , June 16, 2017 at 12:10 pm

Our country is rife with rent seeking pigs who will stoop lower and lower to feed their greed.

Vatch , June 16, 2017 at 12:37 pm

In today's Links section there's this: https://www.theguardian.com/inequality/2017/jun/14/tax-evaders-exposed-why-super-rich-are-even-richer-than-we-thought which has relevance for the discussion of the collapsing social contract.

Chauncey Gardiner , June 16, 2017 at 1:00 pm

Don't know that the two avenues Gaius mentioned are the only two roads our society can travel. In support of this view, I recall a visit to a secondary city in Russia for a few weeks in the early 1990s after the collapse of the USSR. Those were difficult times economically and psychologically for ordinary citizens of that country. Alcoholism was rampant, emotional illness and suicide rates among men of working age were high, mortality rates generally were rising sharply, and birth rates were falling. Yet the glue of common culture, sovereign currency, language, community, and thoughtful and educated citizens held despite corrupt political leadership, the rise of an oligarchic class, and the related emergence of organized criminal networks. There was also adequate food, and critical public infrastructure was maintained, keeping in mind this was shortly after the Chernobyl disaster.

Here in the US the New Deal and other legislation helped preserve social order in the 1930s. Yves also raises an important point in her preface that can provide support for the center by those who are able to do so under the current economic framework. That glue is to participate in one's community; whether it is volunteering at a school, the local food bank, community-oriented social clubs, or in a multitude of other ways; regardless of whether your community is a small town or a large city.

JTMcPhee , June 16, 2017 at 1:21 pm

" Yet the glue of common culture, sovereign currency, language, community, and thoughtful and educated citizens held despite corrupt political leadership, the rise of an oligarchic class, and the related emergence of organized criminal networks."

None of which applies to the Imperium, of course. There's glue, all right, but it's the kind that is used for flooring in Roach Motels (TM), and those horrific rat and mouse traps that stick the rodent to a large rectangle of plastic, where they die eventually of exhaustion and dehydration and starvation The rat can gnaw off a leg that's glued down, but then it tips over and gets glued down by the chest or face or butt

I have to note that several people I know are fastidious about picking up trash other people "throw away." I do it, when I'm up to bending over. I used to be rude about it - one young attractive woman dumped a McDonald's bag and her ashtray out the window of her car at one of our very long Florida traffic lights. I got out of my car, used the mouth of the McDonald's bag to scoop up most of the lipsticked butts, and threw them back into her car. Speaking of mouths, that woman with the artfully painted lips sure had one on her

[Jun 13, 2017] Education Failure is the New Success

Jun 13, 2017 | www.unz.com

Happily, an alternative exists to the billion dollar "don't blame kids" approach, one that has historically proven itself and will cost far less than $16,000 per pupil to impart adequate academic skills. It is simple: pressure laggards to shape up and punish those who disrupt the learning of classmates. Just return to an earlier era when students themselves were held responsible for learning their lessons.

Junk the Rousseauian fantasy that children naturally have a thirst for acquiring knowledge so "educators" need only let nature take its course. Yes, Homo sapiens relish learning, but youngsters are not innately disposed to sit quietly for long periods and dutifully suffer failure. Learning may be natural; schooling is not. The corollary is that school for the cognitively weak will be the most painful. Thus, for many African Americans cultivating self-esteem is anathema to academic achievement.

Fortunately, the repertoire to impose this necessary discipline is well-known and requires only modest skill to implement. High-priced rocket science it is not. This is almost forgotten educational world of shame, stigma, humiliation, dunce caps, browbeating even corporal punishment where teachers forcefully exert authority over the little savages who refuse to learn while impeding the progress of others. Further require teachers to impose clear, grammatically correct English to those with slurred speech and reflexively use profanity. If the teacher's efforts fail, the little miscreants can immediately be sent out for discipline to be monitored by a wicked witch. Conceivably, some retired discipline-skilled Nuns from Catholic schools or a retired Marine drill sergeant could offer three-day workshops on how to manage the classroom

Students can practice sitting still and being quiet for longer and longer times, marching in step when changing classes, mastering polite conversation when addressing authority figures ("Thank you Mr. Smith" not 'hey teach'") memorizing famous orations, and build the habits of punctuality, restraint and patience.

Anonymous June 13, 2017 at 9:06 am GMT

Cheapest offer of "Bad Students, Not Bad Schools "
by Robert Weissberg, used,
is $ 46.00 + $ 3.99 S&H, is

https://www.amazon.com/dp/141281345X/?tag=unco037-20

AngloBerserkerJew , June 13, 2017 at 12:25 pm GMT

I run a large AP program in a what is euphemistically called a "priority" neighbourhood in a major Canadian city. Although most of our students are East Asian and South Asian and come from outside our catchment area, the majority of the local community is black.

After twenty years of our program offering completely subsidized AP exams, after-class tutorials, and massive promotion efforts emphasizing the advantages of taking AP directed to our black students, still less that 5% of the population of our AP classes consists of blacks.

And we have never had a black AP National Scholar. Not one. The local school board would LOVE to see such an event, and I can't imagine it ever happening

Dr. X , June 13, 2017 at 12:58 pm GMT

Are you suggesting that our alien, Third-World, clan-based minority populations adopt the values of discipline, accountability, punctuality, and rule-following typical of the majority's beyond-kin, altruistic-based culture from northern Europe in the hope of achieving similar social, academic, technical, and economic outcomes?

There's an extent to which this does work. Parochial schools with strict discipline policies have always gotten more out of black students than public schools. African students, who do not typically have a race card to play and are products of Euro-colonial school systems, in my experience are nearly always better students than black Americans.

Imagine a Venn diagram, in which one circle represents cognitive ability (IQ) and the other circle represents discipline and culture. The overlapping area represents "educational achievement." The overall black cognitive ability circle, by itself, will always be smaller than a corresponding white circle, but it is possible to gain more achievement with more structure and discipline. There is a limit to how far you can go with this approach, but you can make some gains.

Of course, public schools and colleges practically kiss blacks on the ass for misbehavior rather than discipline them. Blacks are fully aware that the black teachers and administrators are incompetent frauds, that liberal whites are easily pushed around or manipulated, that they can always play the "racism" card, and that Afrocentric curricula is pure bullshit and that it was the white man who invented their iPhones, space flight, etc.

One aspect of the black personality is that blacks respond to, and generally respect, a show a force. You see this in sports, for instance, in prison, and the military. Some of the most competent and useful blacks you will encounter are in the military, where there is a set of expectations, a white chain of command, and punishment for failure.

Blacks wouldn't necessarily become geniuses if you applied a military structure to education, but you'd see some improvement.

Agent76 , June 13, 2017 at 1:08 pm GMT

Jan 23, 2017 Why Good Teachers Want School Choice

Can every child receive a good education? With school choice and competition, yes. The problem? Powerful teachers unions oppose school choice. Rebecca Friedrichs, a public school teacher who took her case against the teachers union all the way to the Supreme Court, explains why school choice is the right choice.

https://youtu.be/PnQu8iRiVYU

Diversity Heretic , June 13, 2017 at 1:22 pm GMT

@Njguy73 There's no need to racially segregate schools. The solution has already been implemented. It's called having a school district where the housing prices do the discrimination, so the schools don't have to. An awfully expensive solution that consigns white working class children to the tender mercies of the snarling black underclass.

anon , June 13, 2017 at 1:23 pm GMT

The plight of black students in black schools became especially dire when the education establishment and the media pulled a slight of hand and started labeling lazy ( a personal fault) students as unmotivated (and therefore the fault of society not motivating them.)

What hasn't been pointed out is while public schools in poor areas have been failing for decades, Catholic schools located in the same areas have continued to turn out hundred of thousands of literate, well behaved black students.

The real tragedy is that these very productive ghetto Catholics schools have been closing at an increasing rate despite their successes because of economic problems. Vouchers would help them to stay open,

THE ACLU however, would make sure that they wouldn't get them.

Simon in London , June 13, 2017 at 2:49 pm GMT

I'm always impressed by the quality of my black African postgrad students, who mostly come from lower middle/upper working class backgrounds in cities like Laos. They are clearly decently educated, by methods the exact opposite of what is advocated in the USA – strict discipline, uniforms, regulation, a decent amount of rote memorisation (but not the passivity of the Middle East/South Asia).

US educationists could learn a lot from Nigeria, or even Jamaica, but are clearly far too arrogant to do so.

Greg Schofield , June 14, 2017 at 12:13 am GMT

I am an old Australian teacher, run out of my profession by managers embracing the American system of de-education.

Your understanding of education is deplorable, and the results of it are horrific, here are a few points that should be carefully considered together.

[Hide MORE]

IQ tests are nonsense.

Testing and teaching are incompatible to one another, less tests and more teaching.

Primary school is NOT the most important time, a few essential skills, a wide and rambling exposure to general knowledge, and some actual fun will do.

Primary school should produce a student capable of writing coherent sentences, reading 80-120 words per minute (well written texts only with unusual words), general knowledge of science, the general framework of modern world history, and enough maths to do simple algebra - anything more is a bonus, but not essential to secondary school.

Secondary school is the secondary level of knowledge - it has nothing much in common with Primary education.

Secondary school is about the development of concepts in different subjects - and the study of literature (a self-contained concept), is foundational to all the other higher subjects.

Literature is about concepts, not morals, slogans, good behaviour or anything else. They are complete, honest works supremely well written world view of the author. The quality of literature is it most important feature - the best and only the best.

The conceptual integrity of literature, not a particular style of language is critical. Literature should not be chosen because it is reverent, but because it is good and great. Confession I hate reading Jane Austin, a girly book of all girly books, but when I finish her work I understand the world were being good is not just a virtue, but an aspiration. For many reasons she was one of the most read authors in the trenches of World War I.

The quality of text books (books of text not pictures) is ESSENTIAL there is no choice in this, no leeway. They must be coherent, the work of the best minds in the subject, comprehensive, and clearly written - only a true expert can make things simple without also making it stupid.

Text books of quality do not have to be up-to-date, but they have to be conceptually complete and clear - a good textbook is not necessarily a recent one.

Textbooks are the last resort, which is the reason they have to be good - it is where the student goes to understand what they do not understand - that is always hard and they need a reliable source material - only the best textbooks will do.

Textbooks are not teaching material, they are reference material.

Standard tests are rubbish, written examinations twice a year are best - this is why text books are important - hitting the books is not easy, I say it again, they therefore need to be the very best - not the normal US textbook - which is CRAP.

The best mark of a substantial work should be the grade, not the average mark - students who learn have to be brave and need to push things - a good student tries and fails long before they try and succeed (the order is sometimes in the reverse).

A student's progress is marked by their best mark, their highest achievement that counts, all the rest are run-offs. A student can be lazy, a student might rest on their laurels, that does not matter, what they achieved, not how they went about it is what examination should do.

It does not matter what a teacher is called by students, but that teacher actually knows their area, is enthusiastic about their knowledge, is supported by the school, encouraged to do more and occasionally make mistakes in trying.

Micro-management, in fact management in general, and good teaching are incompatible.

School discipline is simple and only breaks down because of mismanagement.

Heads and deputies are not there to attend meetings, they must be seen, patrol the halls, greet the students and be known.

Teachers need only have a disruptive student leave the class room and stand in the hall. The deputies need to take them to detention where they sit and do nothing until the next lesson.

Do not trap students behind files of bad behaviour. Boys especially do stupid things, often and repeatedly, only the mean acts should be recorded in detail.

Stop trying to get kids to apologise, girls will do it, and the better boys won't.

Make sure the kids get food, and have fun exercise (competitive sport should be an elective).

Running education is not hard, the fundamentals have been known for hundreds of years. What exists now has been made, it is a policy of de-education and it is working all too well.

[Jun 12, 2017] 5 Questions Universities Must Answer after the Duke Divinity Controversy

If diversity represents sort of "reverse racial discrimination", academic achievements be damned?
Notable quotes:
"... is the notion of "diversity" that is being aimed at supposed to replicate among faculty the current demographic breakdown of our country as a whole? ..."
"... Conversely, if the goal of diversity is compensatory, i.e., seeks to make up for past social injustices and the demographic disequilibrium they have produced, then here too we must be explicit about the point of reference that is to guide our remedial efforts. ..."
"... is diversity pursued under that principle to amount to a retroactive balancing of sorts, an open-ended institutional "reparation" for past injustices and inequities? ..."
"... Leaving aside logistical difficulties, to which one may certainly be sympathetic, why exclude any number of other descriptors from our conception of diversity, such as social class, ethnic background, veteran status, political views, religious belief, childhood trauma, aesthetic preferences, dietary philosophy, dance and gardening skills, past struggles with mental disability, etc.? ..."
"... 'Diversity' was always at best a racket and at worst a knowing stage – a mere stage – in the war to replace Western Civilization. ..."
Jun 12, 2017 | www.theamericanconservative.com

The recent controversy surrounding my colleague and friend, Paul Griffiths, Warren Professor of Catholic Theology in the Duke Divinity School (DDS), has been widely covered. Countless op-ed pieces, fueled by Rod Dreher's online publication of internal memos and public emails at The American Conservative , as well as prominent editorials in the Wall Street Journal and the New York Times , have reached many readers.

... ... ...

Unfortunately, that dialogue remains more elusive than ever. Instead, for quite some time now, the word "diversity" has served two distinct and equally problematic purposes: the magical and the litigious. Some university administrators, particularly those less loyal to the job they have than to the one they covet next, have embraced "diversity" as a professional talisman of sorts, a term that, if wielded frequently and with conspicuous reverence, will magically unlock doors higher up on the professional ladder. Conversely, to faculty members craving moral ascendancy over colleagues whose superior achievements they may regard with a mix of dread, inadequacy and envy, there is no more powerful weapon than to charge the target of their resentment with opposition to diversity, which in the present order of opportune allegations ranks just below that of the child molester. To put it in Platonic terms, contemporary academia has been mirroring our country's deteriorating civic discourse by supplanting knowledge with opinion, and by weaponizing our opinions, rather than understanding them as something for which we bear great responsibility.

1) Is the notion of "diversity" to be understood as a mimetic or compensatory endeavor? That is, is the notion of "diversity" that is being aimed at supposed to replicate among faculty the current demographic breakdown of our country as a whole? Or is the objective to compensate for the extreme dominance of a certain type of faculty-white, Caucasian, male, and (putatively) heterosexual-as it undeniably prevailed well into the 1990s at many institutions of higher learning?

2) Supposing, then, that higher education understands itself to be committed to a mimetic conception of diversity, then what is to serve as our point of reference? Is diversity, as currently affirmed by institutions of higher education, to be modeled on the overall demographic breakdown of the population in the United States-say, as captured by the most recent national census? Or is the university's conception of diversity aimed at some other norm of proportionate representation of minorities, say, one prevalent in academia as a whole or as endemic to specific disciplines?

3) Conversely, if the goal of diversity is compensatory, i.e., seeks to make up for past social injustices and the demographic disequilibrium they have produced, then here too we must be explicit about the point of reference that is to guide our remedial efforts. Is the objective to compensate for a historical lack of diversity that for many decades prevailed inside the academy? And, if so, is diversity pursued under that principle to amount to a retroactive balancing of sorts, an open-ended institutional "reparation" for past injustices and inequities? Here it ought to be kept in mind that, to cast the matter in sacramental terms, there can be no atonement without forgiveness. Hence, if diversity is understood as compensation, then not only must past wrongs in this regard be clearly identified, but any institutional acknowledgment of past injustice must also be met by, and conclude with, an act of comprehensive forgiveness. Otherwise, institutions would remain forever caught up in a downward spiral of moral recrimination and self-abasement, respectively.

4) Assuming that these questions can be openly deliberated and satisfactorily answered (which in the present climate is to assume a great deal indeed), more intractable issues yet will arise. For regardless of whether the modern research university opts for a mimetic or compensatory approach to diversity, it is by definition an inherently selective, elite institution. Thus, one must wonder whether institutions of higher education can balance their highly selective practices of faculty recruitment-practices directly related to the goal of the university as such, viz., advancing knowledge-with a demographically representative notion of "diversity" such as it exists outside of academia?

5) Finally, we should ask why currently prevailing assumptions and practices concerning "diversity" are conceived in such peculiarly narrow, not to say non-diverse ways. We know that empirical demographic studies, including the national census conducted by the U.S. government every decade or so, rely on many categories and descriptors and, consequently, yield a far more inflected and robust conception of our society's diverse composition. That being so, what justifies higher education's conception of "faculty diversity" being mainly restricted to the categories of race and gender? Leaving aside logistical difficulties, to which one may certainly be sympathetic, why exclude any number of other descriptors from our conception of diversity, such as social class, ethnic background, veteran status, political views, religious belief, childhood trauma, aesthetic preferences, dietary philosophy, dance and gardening skills, past struggles with mental disability, etc.?


connecticut farmer, says: June 12, 2017 at 8:18 am

Notwithstanding my agreement with the author, this article is very poorly written and filled with academic jargon, each sentence representing the very antithesis of Churchill's observation that there is nothing more powerful in the English language than a simple, objective sentence.

G Harvey , says: June 12, 2017 at 10:12 am

"'Diversity' is turning into idolatrous worship of empty notions"

The above statement is false because the verb tense is wrong. This is not something new. 'Diversity' was always at best a racket and at worst a knowing stage – a mere stage – in the war to replace Western Civilization.

Professor Pfau: Did you stand up and defend the Duke lacrosse team and its head coach? Did you condemn colleagues such as Leftist Houston Baker.

[Jun 09, 2017] A big reason Corbyn's a commie is because he wants to abolish tuition to bring the UK back to its communist past of 1997 and give young people the same deal all the people in charge had

Notable quotes:
"... Tutition used to be free in the UK. Then they decided that those lazy students needed to have some skin in the game and suddenly tuition was 1000 pounds. Then a few years later it was 9000 pounds and all the college grads there now have US-level student debt. ..."
"... A big reason Corbyn's a commie is because he wants to abolish tuition to bring the UK back to its communist past of 1997 and give young people the same deal all the people in charge had. ..."
Jun 09, 2017 | economistsview.typepad.com
Christopher H., June 09, 2017 at 01:35 PM
Oh look, Atrios blogged something. I guess he didn't get the memo from PGL and the establishment Democrats.

http://www.eschatonblog.com/2017/06/the-kids-are-alright.html

FRIDAY, JUNE 09, 2017

The Kids Are Alright

No actual figures, but presumably there was big yute turnout in the UK Everyone will now claim that a non-commie Labour leader like that nice Ed Miliband would OF COURSE have done as well as Joseph Stalin Lenin Marx Corbyn, and in fact BETTER, but that's bullshit.

That nice Ed Miliband couldn't do in 2015, and I'm not sure who the "unnamed generic normal Labour candidate" would otherwise be. Theresa May's incompetent evil helped, but Corbyn staved off what was supposed to have been a Labour extinction election and while there will still likely be a Tory-led government, it will be pretty fragile. A coalition with a bunch of bigoted religious nutters from Northern Ireland who aren't on board with May's Brexit plans.

Labour went after The Kids Today and got them to the polls. Wasn't enough to win, but the polling outfit predicting a likely hung parliament was considered to be "insane" even just a few days ago.

Tutition used to be free in the UK. Then they decided that those lazy students needed to have some skin in the game and suddenly tuition was 1000 pounds. Then a few years later it was 9000 pounds and all the college grads there now have US-level student debt.

A big reason Corbyn's a commie is because he wants to abolish tuition to bring the UK back to its communist past of 1997 and give young people the same deal all the people in charge had.

In 2015, Miliband said he'd cut them. To just SIX THOUSAND POUNDS. Maybe if he'd gone all the way...

by Atrios at 08:30

[May 31, 2017] Neoliberal enerprices do not wnat to train workers, they expect to get workers that are 100 percent compatible with their requirement on the market or they hire no workers at all.

[Edited for clarity]
Training is offloaded to "human capital" to cut costs and became "workforce responsibility".
Notable quotes:
"... For example, the lack of desire to train is exactly neoliberal phenomenon as it increases costs. They want plug-in workers and that's why they destroyed the US university education to fit this paradigm. ..."
May 31, 2017 | economistsview.typepad.com

cm, May 26, 2017 at 09:12 AM

"Routine" jobs based on cognitive skill or motor skill *will* continue to be automated - it doesn't really depend much on the skill "level" but what complexity/variety of skill application the work requires. "Routine" means by definition identifiable patterns with low variation.

Work that can be performed over a communication line, or performed remotely and the work product transported in bulk (economy of scale), *will* continue to be moved to "low cost locations".

The retiring-boomer argument is not (entirely) about workforce size, but workforce training. When the boomers came of working age and the economy was growing, there was no prior workforce overhang on which business could ride - so the boomers had to be hired more or less on a "raw talent" basis and trained up. This also led to job multipliers - workers can train themselves only so much.

Then with automation "freeing up" a lot of workers, this created a pool of ready talent that has lasted until now, for most jobs. "New technology" always favors the younger generations which need (and get) different foundational skills, but most more general skill sets last for decades.

Most of the labor shortage rhetoric is not about inability to find suitable workers, but undesired necessity to train them (again) after having gotten used to not having to do that as much - because the boomers already had those special skills, or general skills that required only incremental upgrades over time.

libezkova, May 26, 2017 at 10:34 AM
cm,

Your argument is along the lines of neoliberal "human capital" concept and, as such, is false.

For example, the lack of desire to train is exactly neoliberal phenomenon as it increases costs. They want plug-in workers and that's why they destroyed the US university education to fit this paradigm.

It has nothing to do with baby-boomers phenomenon.

cm, May 27, 2017 at 01:35 PM
You can reject the (somewhat unfortunate - accidentally or deliberately) term "human capital" on whatever grounds you desire, but that doesn't invalidate the phenomenon it describes - that human work skill/experience and social relationships enabling labor-divided endeavors are a real thing, and have to be invested in, purposely built, and maintained like physical capital.

In "real existing socialism" it was not different -- investing in workforce skill from the cradle with a heavily built out and supported school/educational system was a top priority, and that it was about "human capital" (of course in the service of the bright future) was quite explicit.

[May 24, 2017] Universities serve as finishing schools for the ruling class by Rob Montz

May 23, 2017

Originally from: Why Colleges Fold to Students' Anti-Intellectual Hysterics The American Conservative

Middlebury College just completed its final round of disciplinary hearings for students involved in March's violent disruption of a lecture by Charles Murray, the influential but controversial social scientist.

The punishments to date have been laughably lax. Guilty students have been presented with non-official "probation" letters that'll vanish upon graduation .

This toothless response reflects a deeper rot. Middlebury, like many prestigious colleges, has steadily gravitated away from its core educational mission and now serves primarily as a sort of finishing school for the ruling class. Professors and administrators alike are simply expected to shower students with affirmation-and then hand over a degree securing smooth entry into America's elite. College has become four years of expensive fun. This is what parents and students now demand.

This change-from institutions of learning to institutions of affirming-threatens the nation's future as colleges foster a vicious strain of anti-intellectualism.

At over $60,000 a year, Middlebury's tuition buys much more than books, lodging, and classes. Students also get a campus-wide square dance , dining halls that host culinary " world tours ," lavish fitness facilities, and an annual winter carnival complete with fireworks, a hot chocolate bar, and snow sculptures.

The student body is ultra-affluent. Middlebury is among a small handful of schools with more students from the top one percent of the income distribution than those from the bottom 60 percent . And on graduation, newly christened alums are typically funneled right back into their elite enclaves, taking jobs at places like Goldman Sachs, McKinsey, and Amazon .

... ... ...

Rob Montz is a fellow at the Moving Picture Institute. Find his work at: RobMontz.com. Check out his interview with TAC executive editor Pratik Chougule at Fearless Parent Radio: http://fearlessparent.org/free-speech-controversy-us-elite-universities-episode-104/

[May 12, 2017] How Financialization and the New Economy Hurt Science and Engineering Grads

Notable quotes:
"... Weinstein argues that the GUI agenda (inspired by Reaganomics) sought to prevent these salary increases. He contends that the legislation that enabled this oversupply was the Immigration Act of 1990 that expanded the H-1B nonimmigrant visa program and instituted employment-based immigration preferences. ..."
"... As I show in my book Sustainable Prosperity in the New Economy? , the beginning of the end of CWOC was the transformation of IBM, the world's leading computer company, from OEBM to NEBM from 1990 to 1994. In 1990, with 374,000 employees, IBM still bragged about its adherence to the CWOC norm (calling it "lifelong employment"), claiming that the company had not laid off anyone involuntarily since 1921. By 1994 IBM had 220,000 employees, and, with senior executives under CEO Louis Gerstner themselves getting fired for not laying off employees fast enough, CWOC was history. Over the course of the 1990s and into the 2000s, other major Old Economy companies followed IBM's example, throwing out of work older employees, many of them highly educated and with accumulated experience that had previously been highly valued by the companies. ..."
"... The salaries of S&E employees tended to increase with years of experience with the company, with a defined-benefit pension (based on years of service and highest salary levels) in retirement. These types of secure employment relations, and the high and rising pay levels associated with them, were the norm among established high-tech companies in the mid-1980s, but, as exemplified by IBM's transformation, started to become undone in the early 1990s, and were virtually extinct a decade later, as Old Economy companies either made the transition to the NEBM, or disappeared.8 The culprit in the weakening in the demand for, and earnings of, S&E PhDs from the early 1990s was the demise of CWOC-a phenomenon that Weinstein (and Teitelbaum) entirely ignore. ..."
"... As exemplified by IBM in the 1990s and beyond, a company's stock price could be raised by laying off expensive older workers and using the resultant "free" cash flow (as the purveyors of MSV called it) to do stock buybacks. 12 ..."
"... "But the company is "returning" capital to shareholders who never gave the company anything in the first place; the only time in its history that Apple has ever raised funds on the public stock market was $97 million in its 1980 IPO." ..."
"... During that period, the only job market for native PhD STEM students became the American Defense and Intelligence agencies, because they required security clearances and US Citizenship. I found myself driven in those directions too. ..."
"... Technology for the most part is just increasing complexity and increasing complexity has diminishing returns. With energy becoming less available, we probably need a lot less complexity. ..."
"... I wouldn't say that there is a lack of R&D - it just isn't done in-house any more. Gone are the Bell Labs and the Xerox PARCs; welcome to the brave new world of university partnerships and non-profit R&D shops (most famous: the Southwest Research Institute). ..."
"... Basically the rich are waging class war. That's the problem no matter how you slice and dice this one. This whole "New Economy" has been one big war on wages. I mean look at the collusion too between Google, Apple, and Intel to keep wages low. ..."
"... Basically it comes down to, the rich are really greedy. The issue right now for the rich is that they are desperate to keep the looting from happening, while people are increasingly aware that the system is against them. Bernie Sanders got a lot of support in the Valley and while it is a very Democratic leaning area, I cannot imagine that Trump's anti-H1B and L1B stance would have been opposed by the average employee. I think that the rich are not going to concede anything and that there needs to be some sort of solidarity union amongst all workers. ..."
"... Is there a single person here who has worked on Wall Street (writ large) who can convince us that his job or his company had an overall positive effect on the US and/or world economy over five years, ten years, or twenty-five years? ..."
"... Its not just PhDs. I know several Engineers who advise their children to do something else. It's just not worth the amount of effort that is required to be put into it and there is no future hope of a turn around. As bad as it is for graduates today, it's only going to get worse. ..."
"... They're catching up with us arts and humanities majors. Sad! ..."
"... I am a civil engineer and one of my daughters is studying to become a structural engineer. I would not have advised her to go into engineering because of the problem with the H-1B visas. ..."
"... But who am I to advise? Who can know the future? The world is just changing too fast now to really be able to advise our children on what careers to take. Besides, one of the advantages of studying engineering as you can work anywhere in the world. ..."
"... Post WWII labor overplayed its hand by the 1970's. Corporations and their decided they had had it. Corps and management proceeded to change the rules of the game on everything -- courts, trade, taxation and regulation. These countermeasures have had disastrous long term consequences. Corporations now run the country in a fascist manner. Government capture has created myriad problems beyond financialization, only one tool in the corporate quiver. Oligopolies across most to all industries comes to mind. Rail, air, health insurance, banking, defense, telecom, entertainment . ..."
"... Not sure about the labor part overplaying their hand. They just wanted an even wage and productivity rise. It is capital IMO that has overplayed its hand and the rise of neoliberal economics which has led to declines in public R&D spending. There isn't anything like the Space Race anymore. ..."
"... Frankly, labour underplayed its hand. At one point it had capital by the throat, and should have finished it off then. If peace is not an option, you should utterly and permanently destroy your enemy. ..."
"... Labor did NOT overplay its hand after WW2 - Taft-Hartley was a HUGE smack-down to labor after the privations of the Depression followed by the war effort. The decent wages during the post-war period were part of a concerted effort to convince workers that they didn't need unions and to be complacent. ..."
"... Labor leadership certainly became corrupt from all the money sloshing around without global competition due to war devastation of Europe and Japan, the Cold War, and the death throes of colonialism, but this was not due to "overplaying" their hand. ..."
"... Contrary to popular belief, in aggregate U.S. corporations fund the stock market, not vice versa. Note that almost all of the buybacks in the decade 1976-1985 occurred in 1984 and 1985 after in November 1982 the U.S. Securities and Exchange Commission adopted Rule 10b-18 that gave license to massive buybacks, in essence legalizing systemic stock-price manipulation and the looting of the U.S. business corporation. ..."
"... Actually though, watching the train wreck that is the outlook for the youngest generation today, provides some grim amusement. For instance noting that the "bubble-driven" economy composed of companies desperate to prevent their stock becoming "badly diluted" by having fire sales on capitol and expertise that probably took their predecessors decades to build can really only have one outcome. Depression, misery, socialism. Maybe we skip the Mao route this time, maybe not. ..."
"... Gregory Peck: "The Robber Barons of old at least left something tangible in their wake - a coal mine, a railroad, banks. THIS MAN LEAVES NOTHING. HE CREATES NOTHING. HE BUILDS NOTHING. HE RUNS NOTHING. And in his wake lies nothing but a blizzard of paper to cover the pain. Oh, if he said, "I know how to run your business better than you," that would be something worth talking about. But he's not saying that. He's saying, "I'm going to kill you because at this particular moment in time, you're worth more dead than alive." https://www.youtube.com/watch?v=xJRhrow3Jws ..."
"... IBM. Poster child of everything wrong at the executive-level and the shareholder-level. ..."
"... Yes, the IBM reference is interesting.The author gives an ordinal lead to IBM as a mover from the OEBM to NEBM. I ask myself if, from a mere one large corporation managing perspective, this was IBM's 11th hour response to the by then devastating rise of its competitors like Apple & Microsoft. ..."
"... Also the irony that it did not help IBM at least in the midterm. So, IBM was the prime mover to initiate some aspects of a model change -change which every major player adhered to- in response to a new technological disadvantage vs. competitors, and in turned did not seem to do much for IBM in the immediate years. Although, if I recall well, IBM was immersed in many political battles and internal problems, legal and otherwise. Nevertheless, I doubt there was a historic inevitability on IBM's ordinal force. Outstanding work by Lazonick ..."
"... "IBM is the poster child for shenanigans. Last month, IBM reported its 20th quarter in a row of declining year over year revenues .. a 13% drop in earnings, profit margins that declined in every business segment ( much worse than expected ), free cash flow that plummeted over 50% year over year and an earnings "beat" of 3 cents per share. How could this "beat" happen? .. a negative tax rate of -23% . This is why they pay the CEO Rometti the big bucks ( estimated at $50 to $65 million last year)." ..."
"... And this is one of the Bluest of the Blue Chip companies in the world. ..."
"... Amazon has lost money every fucking quarter for the last 20 fucking years, and that Bezos motherfucker is the king. ..."
"... In addition, the rise of 401(k) based investing, in which workers are tax-incentivized to buy in to the corporate stock scheming, but lack the normal shareholder voice in corporate governance, has taken the chains off the looters as well. ..."
"... The impact on the Grads was secondary a byproduct of a larger agenda which included the transfer offshore and consolidation of "IP" of the entire American, EU and Asian industrial economies along with the withdrawl of capital, while at the same time intentionally sabotaging future innovations with the handicap of diversity. Who got the loot and capital? Usual suspects. ..."
May 12, 2017 | www.nakedcapitalism.com

... By William Lazonick, professor of economics at University of Massachusetts Lowell. Originally published at the Institute for New Economic Thinking website

How the U.S. New Economy Business Model has devalued science & engineering PhDs This note comments on Eric Weinstein's, " How and Why Government, Universities, and Industries Create Domestic Labor Shortages of Scientists and High-Tech Workers ," posted recently on INET's website.

At the outset of his paper, Weinstein argues that:

Long term labor shortages do not happen naturally in market economies. That is not to say that they don't exist. They are created when employers or government agencies tamper with the natural functioning of the wage mechanism.

The contention, written from the perspective of the late 1990s, is that in the first half of the 1990s an oversupply ("a glut") of science and engineering (S&E) labor that depressed the wages of PhD scientists and engineers was primarily the result of the promotion of a government-university-industry (GUI) agenda, coordinated by the National Science Foundation under the leadership of Erich Bloch, head of the NSF from 1984 to 1990. Beginning in 1985, the NSF predicted a shortfall of 675,000 S&E personnel in the U.S. economy over the next two decades. According to a study by the NSF's Policy Research and Analysis (PRA) division, quoted by Weinstein, salary data show that real PhD-level pay began to rise after 1982, moving from $52,000 to $64,000 in 1987 (measured in 1984 dollars). One set of salary projections show that real pay will reach $75,000 in 1996 and approach $100,000 shortly beyond the year 2000.

Weinstein argues that the GUI agenda (inspired by Reaganomics) sought to prevent these salary increases. He contends that the legislation that enabled this oversupply was the Immigration Act of 1990 that expanded the H-1B nonimmigrant visa program and instituted employment-based immigration preferences. Given that most of these foreigners came from lower-wage (Asian) nations, it is assumed that they were attracted to work in the United States by what for them were high wages, whereas Americans with S&E PhDs began to shun S&E careers as the salaries became less attractive.1

There is a lot missing from Weinstein's perspective, which is also the perspective of demographer Michael Teitelbaum, who Weinstein cites extensively and who was at the Sloan Foundation from 1983 to 2013, rising to Vice-President in 2006. Weinstein and Teitelbaum view the salaries of scientists and engineers as being determined by supply and demand on the labor market ("the natural wage rate" and "the natural functioning of the labor market"). From this (neoclassical) perspective, they completely ignore the "marketization" of employment relations for S&E workers that occurred in the U.S. business sector from the mid-1980s as well as the concomitant "financialization" of the U.S. business corporation that remains, in my view, the most damaging economic problem facing the United States. This transformation of employment relations put out of work large numbers of PhD scientists and engineers who previously had secure employment and who enjoyed high incomes and benefits as well as creative corporate careers. The marketization of employment relations brought to an end of the norm of a career with one company (CWOC)-an employment norm that was pervasive in U.S. business corporations from the 1950s to the 1980s, but that has since disappeared. 2 The "financialization" of the corporation, manifested by massive distributions to shareholders in the forms of cash dividends and stock buybacks, undermined the opportunities for business-sector S&E careers.

The major cause of marketization was the rise of the "New Economy business model" (NEBM) in which high-tech startups, primarily in information-and-communication technology (ICT) and biotechnology, lured S&E personnel away from established companies, which offered CWOC under the "Old Economy business model" (OEBM). As startups with uncertain futures, the New Economy companies could not realistically offer CWOC, but instead enticed S&E personnel away from CWOC at Old Economy companies by offering these employees stock options on top of their salaries (which were typically lower than those at the Old Economy companies). The stock options could become extremely valuable if and when the startup did an initial public offering (IPO) or a merger-and-acquisition (M&A) deal with an established publicly-listed company.

The rise in S&E PhD salaries from 1982 to 1987, identified in the NSF study that Weinstein quotes, was the result of increased demand for S&E personnel by New Economy companies, with some of the increase taking the form of stock-based pay, which in the Census data drawn from tax returns is lumped in with salaries.3 Competing with companies for S&E personnel, the rise of the NEBM in turn put pressure on salaries at Old Economy companies as they tried to use CWOC to attract and retain S&E labor in the face of the stock-based alternative. By the last half of the 1980s, this New Economy competition for talent was eroding the learning capabilities of the corporate research labs that, in many cases from the early twentieth century, had been a characteristic feature of Old Economy companies in a wide range of knowledge-intensive industries. 4

The CWOC norm under OEBM had provided employment security and rising wages from years-of-service with the company and internal promotion of S&E personnel (significant proportions of whom in science- based companies had PhDs). As I show in my book Sustainable Prosperity in the New Economy? , the beginning of the end of CWOC was the transformation of IBM, the world's leading computer company, from OEBM to NEBM from 1990 to 1994. In 1990, with 374,000 employees, IBM still bragged about its adherence to the CWOC norm (calling it "lifelong employment"), claiming that the company had not laid off anyone involuntarily since 1921. By 1994 IBM had 220,000 employees, and, with senior executives under CEO Louis Gerstner themselves getting fired for not laying off employees fast enough, CWOC was history. Over the course of the 1990s and into the 2000s, other major Old Economy companies followed IBM's example, throwing out of work older employees, many of them highly educated and with accumulated experience that had previously been highly valued by the companies.

Already in the early 1990s, the marketization of employment relations was responsible for a precipitous decline of employment at the corporate research labs that had underpinned the twentieth-century growth of Old Economy high-tech companies, of which IBM was an exemplar. In 1993, a conference held at Harvard Business School decried the "end of an era" in industrial research, with papers from the conference appearing in a volume Engines of Innovation , published in 1996.5 In the introductory chapter, entitled "Technology's Vanishing Wellspring," conference organizers and volume editors Richard Rosenbloom and William Spencer argued that industrial research (as distinct from product development) of the type that had been carried out by corporate labs in the "golden era" of the post- World War II decades "expands the base of knowledge on which existing industries depend and generates new knowledge that leads to new technologies and the birth of new industries." In the more competitive environment of the 1980s and 1990s, however, in the new industries of "biotechnology, exotic materials, and information products (and services based on them)", Rosenbloom and Spencer observed that it was more difficult for companies "to keep new technologies fully proprietary", and hence "research activities have been downsized, redirected, and restructured in recent years within most of the firms that once were among the largest sponsors of industrial research." 6

There is little doubt that S&E PhDs were major victims of this transformation. But the problem that they, along with most other members of the U.S. labor force, have faced is not simply the marketization of employment relations. For reasons that I have fully described in my publications cited above, the transition from OEBM to NEBM was accompanied by the "financialization" of the U.S. business corporation as, from the last half of the 1980s, U.S. boardrooms and business schools embraced the ideology that, for the sake of superior economic performance, a business enterprise should be run to "maximize shareholder value" (MSV). Instead of retaining employees and reinvesting in their productive capabilities, as had been the case when CWOC had prevailed, MSV advocated and legitimized the downsizing of the company's labor force and the distribution of corporate revenues to shareholders in the forms of both cash dividends and stock repurchases. 7

With the demise of CWOC, older employees were the most vulnerable, not only because they tended to have the highest salaries, but also because the shift from OEBM to NEBM was a shift from proprietary technology systems, in which employees with long years of experience were highly valued, to open technology systems that favored younger workers with the latest computer-related skills (often acquired by working at other companies). Under CWOC, older employees were more expensive not because of a "natural wage rate" that was the result of supply and demand on the S&E labor market, but because of the internal job ladders that are integral to a "retain-and-reinvest" resource-allocation regime. The salaries of S&E employees tended to increase with years of experience with the company, with a defined-benefit pension (based on years of service and highest salary levels) in retirement. These types of secure employment relations, and the high and rising pay levels associated with them, were the norm among established high-tech companies in the mid-1980s, but, as exemplified by IBM's transformation, started to become undone in the early 1990s, and were virtually extinct a decade later, as Old Economy companies either made the transition to the NEBM, or disappeared.8 The culprit in the weakening in the demand for, and earnings of, S&E PhDs from the early 1990s was the demise of CWOC-a phenomenon that Weinstein (and Teitelbaum) entirely ignore.

With the rise of NEBM, companies wanted employees who were younger and cheaper , and that was the major reason why at the end of the 1980s the ICT industry pushed for an expansion of H-1B nonimmigrant visas and employment-based immigration visas. It is not at all clear that an influx of PhDs from foreign countries via these programs was undermining the earnings of S&E PhDs in the early 1990s. Most H-1B visa holders had Bachelor's degrees when they entered the United States. At the same time, large numbers of non-immigrant visa holders entered the United States on student visas to do Master's and PhD degrees, and then looked to employment on H-1B visas to enable them to stay in the United States for extended periods (up to seven years).9 It was in response to the availability of advanced- degree graduates of U.S. universities that in 2005 an additional 20,000 H-1B visas were added to the normal cap of 65,000. Without the influx of foreign students into U.S. S&E Master's and PhD programs, many of these programs would not have survived. Through this route, the H-1B visa program has made more foreign-born PhDs available to corporations for employment in the United States. But I posit that it has been the demise of OEBM and rise of the NEBM, not an increased supply of foreign-born PhDs, that has placed downward pressure on the career earnings of the most highly educated members of the U.S. labor force.

Besides giving employers access to an expanded supply of younger and cheaper high-tech labor in the United States, the H-1B visa along with the L-1 visa for people who had previously worked for the employer for at least one year outside the United States have another valuable attribute for employers: the person on the visa is immobile on the labor market-he or she can't change jobs-whereas under NEBM the most valued high-tech workers are those who are highly mobile. This mobility of labor can boost the worker's pay package but is highly problematic for a company that needs these employees to be engaged in the collective and cumulative learning processes that are the essence of generating competitive products. Under OEBM, CWOC was the central employment institution for college-educated workers precisely because of the need for collective and cumulative learning. But it was the rise of NEBM, not the Immigration Act of 1990, that undermined CWOC. The growing dominance of NEBM with its open systems architectures then led employers to make increased use of H-1 and L-1 visas in the 1980s, prompting them to get behind an expanded cap for H-1B visas in the Immigration Act of 1990. 10

Once OEBM was attacked by NEBM, with its offer of stock-based pay, these corporations became fertile territory for the adoption of the ideology that a company should be run to "maximize shareholder value" (MSV). This momentous transformation in U.S. corporate governance occurred from the late 1980s, legitimizing the transition from a "retain-and-reinvest" to a "downsize-and-distribute" corporate- governance regime. In the 1990s and beyond, this corporate-governance transformation laid waste to CWOC across corporate America, knowledge-intensive companies included. 11 With corporate research eroding as high-tech personnel responded to the lure of stock-based pay from NEBM companies- including not only startups but also those such as Intel, Microsoft, Oracle, Sun Microsystems, and Cisco Systems that during the 1990s grew to employ tens of thousands of people, most of them with stock- based pay-senior executives at the Old Economy high-tech companies began to see their company's stock price as not only key to the size of their own stock-based pay packages but also as an instrument to compete for a broad-based of high-tech personnel. As exemplified by IBM in the 1990s and beyond, a company's stock price could be raised by laying off expensive older workers and using the resultant "free" cash flow (as the purveyors of MSV called it) to do stock buybacks. 12

As I have documented in detail, over the past three decades this legalized looting of the U.S. business corporation has only gotten worse. As shown Table 1, driven by stock buybacks, net equity issues by U.S. nonfinancial corporations were, in 2015 dollars, minus $4.5 trillion over the decade 2006-2015. In 2016 net equity issues were minus $586 billion. Net equity issues are new stock issues by companies (in this case nonfinancial corporations) minus stock retired from the market as the result of stock repurchases and M&A deals. The massively negative numbers in recent decades are the result of stock buybacks. I have calculated net equity issues as a percent of GDP by decade to provide a measure of the value of buybacks done relative to the size of the U.S. economy. In both absolute inflation-adjusted dollars and as a percent of GDP, buybacks have become a prime mode of corporate resource allocation in the U.S. economy. Contrary to popular belief, in aggregate U.S. corporations fund the stock market, not vice versa. Note that almost all of the buybacks in the decade 1976-1985 occurred in 1984 and 1985 after in November 1982 the U.S. Securities and Exchange Commission adopted Rule 10b-18 that gave license to massive buybacks, in essence legalizing systemic stock-price manipulation and the looting of the U.S. business corporation.

Table 1: Net equity issues of nonfinancial corporations in the United States, 1946-2015, by decade, in 2015 dollars, and as a percent of GDP

Decade Net Equity Issues,

2015$ billions

Net Equity Issues

as % of GDP

1946-1955 143.2 0.56
1956-1965 110.9 0.30
1966-1975 316.0 0.58
1976-1985 -290.9 -0.40
1986-1995 -1,002.5 -1.00
1996-2005 -1,524.4 -1.09
2006-2015 -4,466.6 -2.65

Source: Board of Governors of the Federal Reserve System, Federal Reserve Statistical Release Z.1, "Financial Accounts of the United States: Flow of Funds, Balance Sheets, and Integrated Macroeconomic Accounts," Table F-223: Corporate Equities, March 9, 2017, at https://www.federalreserve.gov/releases/z1/current/ .

Over the years 2006-2015, the 459 companies in the S&P 500 Index in January 2016 that were publicly listed over the ten-year period expended $3.9 trillion on stock buybacks, representing 53.6 percent of net income, plus another 36.7 percent of net income on dividends. Much of the remaining 9.7 percent of profits was held abroad, sheltered from U.S. taxes. Mean buybacks for these 459 companies ranged from $291 million in 2009, when the stock markets had collapsed, to $1,205 million in 2007, when the stock market peaked before the Great Financial Crisis. In 2015, with the stock market booming, mean buybacks for these companies were $1,173 million. Meanwhile, dividends declined moderately in 2009, but over the period 2006-2015 they trended up in real terms.

Among the largest repurchasers are America's premier high-tech companies. Table 2 shows the top 25 repurchasers over the decade 2006-2015. Among the companies that one would expect to employ large numbers of S&E PhDs are Exxon Mobil, Microsoft, IBM, Apple, Cisco Systems, Hewlett Packard, Pfizer, Oracle, Intel, General Electric, Johnson & Johnson, Chevron, and ConocoPhillips. We do not know the historical numbers of S&E PhDs at these companies, but I hypothesize that numbers would be much higher than they are if the companies were not financialized. Many of America's largest corporations

routinely distribute more than 100 percent of net income to shareholders, generating the extra cash by reducing cash reserves, selling off assets, taking on debt, or laying off employees.13 As I have shown, the only logical explanation for this buyback activity is that the stock-based pay that represents the vast majority of the remuneration of senior corporate executives incentivizes them to manipulate their companies' stock prices, leaving most Americans worse off. 14

Table 2: The 25 largest stock repurchasers among U.S.-based corporations, 2006-2015, showing net income (NI) stock buybacks (BB), and cash dividends (DV)

Source: Calculated from data downloaded from Standard & Poor's Compustat database.

The Weinstein-Teitelbaum focus on a GUI design to expand the supply of S&E PhDs ignores the transformations of corporate governance and employment relations that have decimated career employment for this group of workers over the past three decades. At the same time, the channeling of trillions of dollars of value created in U.S. nonfinancial corporations to the financial sector has opened up jobs on Wall Street that can provide quick income bonanzas for highly-educated members of the U.S. labor force, many of whom might have otherwise pursued S&E careers. Among the wealthiest of these Wall Street players are corporate predators-euphemistically known as "hedge-fund activists"-who have billions of dollars in assets under management with which they can attack companies to pump up their stock prices through the implementation of "downsize-and-distribute" allocation regimes and, even if it takes a few years, dump the stock for huge gains.15

In the case of Apple, we have shown how Carl Icahn used his wealth, visibility, hype, and influence to take $2 billion in stock-market gains by buying $3.6 billion of Apple shares in the summer of 2013 and selling them in the winter of 2016, even though he contributed absolutely nothing of any kind to Apple as a value-creating company.16 Apple CEO Tim Cook and his board (which includes former U.S. Vice President Al Gore) helped Icahn turn his accumulated fortune into an even bigger one by having Apple repurchase $45 billion in shares in 2014 and $36 billion in 2015-by far the two largest one-year stock buybacks of any company in history. Imagine the corporate research capabilities in which Apple could have invested, and the S&E PhDs the company could have employed, had it looked for productive ways to use even a fraction of the almost unimaginable sums that it wasted on buybacks.17 From 2011 through the first quarter of 2017, Apple spent $144 billion on buybacks and $51 billion on dividends under what it calls its "Capital Return" program. But the company is "returning" capital to shareholders who never gave the company anything in the first place; the only time in its history that Apple has ever raised funds on the public stock market was $97 million in its 1980 IPO. 18

A number of "hedge-fund activists"-Nelson Peltz of Trian, Daniel Loeb of Third Point, and William Ackman of Pershing Square are among the most prominent-have been able to put up one or two billion dollars to purchase small stakes in major high-tech companies, and, with the proxy votes of pension funds, mutual funds and endowments, have been able put pressure on companies, often by placing their representatives on the boards of directors, to implement "downsize-and-distribute" regimes for the sake of "maximizing shareholder value."19 In the summer of 2013, Nelson Peltz's Trian Fund Management bought DuPont stock worth $1.3 billion, representing 2.2% of shares outstanding. In May 2015 Peltz lost a proxy fight to put four of his nominees on the DuPont board, but in October 2015 DuPont CEO Ellen Kullman, who had opposed Peltz, resigned, and the new management began to implement Peltz's plans to cut costs and hit financial targets, to be done in the context of a merger with Dow Chemical, which had fallen into the hands of another corporate predator Daniel Loeb. Meanwhile, in October 2015, Peltz bought 0.8 percent of the shares of General Electric (GE), and began to pressure another iconic high-tech company to cut costs and increase its stock price. GE was already a financialized company that had done $52 billion in buybacks in the decade 2006-2015 (see Table 2)-a massive amount of money for the purpose of manipulating its stock price. Undoubtedly responding to additional pressure from Peltz, during 2016, GE, with profits of $8.0 billion, paid out $8.5 billion in dividends and spent another $22.0 billion on buybacks. This financialization of U.S. high-tech corporations undermines, among other things, the employment of S&E PhDs.

We need research on this subject to quantify its impacts. I submit, however, that such a research agenda must focus on transformations of regimes of corporate governance and employment relations. Relying on the neoclassical economist's notion of a "natural wage rate" determined by the interaction of supply and demand, Weinstein, a mathematician, and Teitelbaum, a demographer, missed the transformations in corporate governance and employment relations that marked the late 1980s and early 1990s-and beyond-and as result, in my view, failed to understand the changing fortunes of S&E PhDs in the marketized, globalized, and financialized New Economy. Given the dominance of what I have called "the myth of the market economy"20 in the thought processes of economists, Weinstein and Teitelbaum were by no means alone in erroneously focusing on supply and demand on the PhD labor market while failing to recognize the centrality of corporate governance and employment relations in determining the earnings and career prospects of S&E PhDs. It is time for new economic thinking on these critical questions.

Footnotes

Tom_Doak , May 12, 2017 at 10:08 am

It was indeed a tough article to read to the end, but this nugget near the end was worth it:

"But the company is "returning" capital to shareholders who never gave the company anything in the first place; the only time in its history that Apple has ever raised funds on the public stock market was $97 million in its 1980 IPO."

Wow!

David McClain , May 12, 2017 at 10:10 am

As one who actually lived this process, I can tell you that the premise of this article must be basically true.

Back in the early '90s I set out to fill in the gaps of my own computer science background (I'm actually an astrophysicist). And my classes were filled entirely by people from Asia, except for myself and one other Anglo. Job ads in the journals were already beginning to ask for PhD level CompSci with emphasis on, e.g., voice recognition, for a pay rate of $26K (1992 !). That was definitely appealing to the foreign students and unappealing to American STEM students.

During that period, the only job market for native PhD STEM students became the American Defense and Intelligence agencies, because they required security clearances and US Citizenship. I found myself driven in those directions too.

Now, after many years doing my own thing, I look around at the STEM marketplace and I am shocked to find large numbers of compatriots being pressured into the GIG Economy, and pay rates are appalling by former standards. There is a serious lack of expenditure on research and development today.

tony , May 12, 2017 at 10:44 am

There is a serious lack of expenditure on research and development today.

From another perspective this is just over investment in education. Technology for the most part is just increasing complexity and increasing complexity has diminishing returns. With energy becoming less available, we probably need a lot less complexity.

flora , May 12, 2017 at 10:49 am

"American Defense". hmmm, wonder if sending the jobs and know-how to China and India in the belief both will always be the US's willing subcontractors is such a good idea (from a US national defense point of view).

Ranger Rick , May 12, 2017 at 1:14 pm

I wouldn't say that there is a lack of R&D - it just isn't done in-house any more. Gone are the Bell Labs and the Xerox PARCs; welcome to the brave new world of university partnerships and non-profit R&D shops (most famous: the Southwest Research Institute).

Altandmain , May 12, 2017 at 10:21 am

Basically the rich are waging class war. That's the problem no matter how you slice and dice this one. This whole "New Economy" has been one big war on wages. I mean look at the collusion too between Google, Apple, and Intel to keep wages low.

https://www.wired.com/2015/01/apple-google-tech-giants-reach-415m-settlement-poaching-suit/

Considering how slap on the wrist this was, what incentive is there to not do it again? They know they can get away with this. Not to mention, this H1B and L1B program has become a way to keep wages low in the technology sector. In many sectors, there really isn't a "shortage" of Americans. Oh and for all the talk of these companies being "innovative", if they are prioritizing money on stock buybacks over R&D, that's not really innovative as much as it is trying to boost salaries by capitalizing on the huge cash reserves they get for being the dominant companies in their sector. Same could be said about Exxon. Not much being spent on R&D means that they are more about rent seeking rather than innovation. Perhaps not yet as blatant as those patent trolls, which are little more than shell companies that sue other companies over patents, but that is their ideal business model.

I think that at the end of the day, even though many engineers in the tech companies are in the top 10% in terms of income percentile, their interests are closer aligned with working class people. The other issue is that I bet when many of these engineers turn into their 40s, they are going to witness first hand the very real age discrimination that exists in the technology industry.

Basically it comes down to, the rich are really greedy. The issue right now for the rich is that they are desperate to keep the looting from happening, while people are increasingly aware that the system is against them. Bernie Sanders got a lot of support in the Valley and while it is a very Democratic leaning area, I cannot imagine that Trump's anti-H1B and L1B stance would have been opposed by the average employee. I think that the rich are not going to concede anything and that there needs to be some sort of solidarity union amongst all workers.

Expat , May 12, 2017 at 10:39 am

Is there a single person here who has worked on Wall Street (writ large) who can convince us that his job or his company had an overall positive effect on the US and/or world economy over five years, ten years, or twenty-five years?

I'll go first: three investment banks under my belt and one was a giant financial and moral sucking machine called Citi. The other two were wannabe's but certainly did not add value.

Sluggeaux , May 12, 2017 at 11:12 am

While "maximizing shareholder value" is the huge problem wrecking our economy, having watched the genesis of New Economic Paradigm through the experiences my wife and most of my friends going through the Silicon Valley start-up Tulip-mania from the mid-'80's through the first decade of th e 2000's, the author is hitting important points while over-simplifying and missing other equally important points, such as the role of the "Peace Dividend" in the collapse of aerospace and research funding, and the role of the Reagan and Clinton "tax reforms" in driving stock-based compensation systems.

Early on, the use of stock-based compensation drove down wage-based compensation and increased the role of financial speculators. Today, the speculators get the stock, but wages remain suppressed and only foreign workers will accept them. The author is correct: the causes are complicated, but the result drove down wages and job security for STEM workers.

mary , May 12, 2017 at 11:30 am

I got my Ph.D. in biology in 2000. It was absolutely the worst decision in my life. In fact, it actually destroyed my life, reducing me to near homelessness and starvation because-GASP--regular employers (like office jobs, retail etc.) will not hire Ph.D.s. There there is the lovely student debt that has grown exponentially, as my wages could not make the smallest dent. Convicted felons make more that I do. So to make a long story short, I started a small on-line business 9 years ago and got the FFFFF OUT of the rotten POS United States and moved to Ecuador, one of the most progressive countries in the world. I cannot believe how the US abuses its national treasures-is is truly a POS and I do not miss it for one day. I hope the US crashes and rots in hell.

JDS , May 12, 2017 at 1:45 pm

Good for you! I wish I could do the same that is, leave the country!

visitor , May 12, 2017 at 2:55 pm

Out of curiosity: what happened to your student debt when you emigrated?

fritter , May 12, 2017 at 11:40 am

Its not just PhDs. I know several Engineers who advise their children to do something else. It's just not worth the amount of effort that is required to be put into it and there is no future hope of a turn around. As bad as it is for graduates today, it's only going to get worse.

nycTerrierist , May 12, 2017 at 12:21 pm

They're catching up with us arts and humanities majors. Sad!

B1whois , May 12, 2017 at 1:14 pm

I am a civil engineer and one of my daughters is studying to become a structural engineer. I would not have advised her to go into engineering because of the problem with the H-1B visas.

But who am I to advise? Who can know the future? The world is just changing too fast now to really be able to advise our children on what careers to take. Besides, one of the advantages of studying engineering as you can work anywhere in the world.

I bought houses for each of my children and told them if they wanted to go to college they could trade the house in for the education. I personally think they should have considered keeping the house and working minimum wage jobs that they enjoy. But both of them are pursuing educations, my son to be history teacher!

cr , May 12, 2017 at 12:01 pm

Post WWII labor overplayed its hand by the 1970's. Corporations and their decided they had had it. Corps and management proceeded to change the rules of the game on everything -- courts, trade, taxation and regulation. These countermeasures have had disastrous long term consequences. Corporations now run the country in a fascist manner. Government capture has created myriad problems beyond financialization, only one tool in the corporate quiver. Oligopolies across most to all industries comes to mind. Rail, air, health insurance, banking, defense, telecom, entertainment .

But this paper is also lamenting a lack of business capex, which is directly correlated to public investment. When you decided to offshore manufacturing and fail to invest in infrastructure you get a double whammy that hits business capex. Increasing regulation and taxation on small and midsize companies has lead to consolidation. Approximately 5000 public companies have likely been consolidated. Sarbanes-Oxley added millions to compliance costs making it highly uneconomical to be a public company with less than $300 million in revenue. Dodd-Frank has created increases in cost for financial firms that had nothing to do with the crisis. In fact, the big banks have benefited enormously from implementation of this legislation.

Vatch , May 12, 2017 at 12:20 pm

For anyone else who was confused by the terminology, as I was briefly, capex = capital expenditure.

Altandmain , May 12, 2017 at 1:13 pm

Not sure about the labor part overplaying their hand. They just wanted an even wage and productivity rise. It is capital IMO that has overplayed its hand and the rise of neoliberal economics which has led to declines in public R&D spending. There isn't anything like the Space Race anymore.

tony , May 12, 2017 at 3:20 pm

Frankly, labour underplayed its hand. At one point it had capital by the throat, and should have finished it off then. If peace is not an option, you should utterly and permanently destroy your enemy.

Sluggeaux , May 12, 2017 at 4:53 pm

Labor did NOT overplay its hand after WW2 - Taft-Hartley was a HUGE smack-down to labor after the privations of the Depression followed by the war effort. The decent wages during the post-war period were part of a concerted effort to convince workers that they didn't need unions and to be complacent.

Labor leadership certainly became corrupt from all the money sloshing around without global competition due to war devastation of Europe and Japan, the Cold War, and the death throes of colonialism, but this was not due to "overplaying" their hand.

allan , May 12, 2017 at 12:15 pm

Reply to cr@May 12, 2017 at 12:01 pm

Sarbanes-Oxley Dodd-Frank

The trends described in the post predate by decades the communist tyranny [/s] imposed by those bills.
The wholesale closing or offshoring of corporate research labs already started in the 1980s,
driven in part by corporate raiders like Milken, Pickens and Icahn.
IBM, GM, Kodak, Xerox, GE they all had labs that provided jobs to STEM graduates
and a stream of discoveries and inventions to generate more jobs.
Now these are largely gone or substantially off-shored.
What has happened to corporate R&D shouldn't be used as an excuse to make life easier
for the Wall Street culture largely responsible for it.

Vatch , May 12, 2017 at 12:22 pm

Yes, any burdens imposed by Sarbanes Oxley are the fault of numerous unethical business executives over recent decades, and not the fault of people in government.

visitor , May 12, 2017 at 3:02 pm

When I was a student in IT, the shining stars at the firmament of industrial computer science and engineering R&D were Xerox PARC, DEC SRC, ATT Bell Labs and IBM Yorktown Heights.

They are gone or a shadow of their former selves.

Science Officer Smirnoff , May 12, 2017 at 12:36 pm

Contrary to popular belief, in aggregate U.S. corporations fund the stock market, not vice versa. Note that almost all of the buybacks in the decade 1976-1985 occurred in 1984 and 1985 after in November 1982 the U.S. Securities and Exchange Commission adopted Rule 10b-18 that gave license to massive buybacks, in essence legalizing systemic stock-price manipulation and the looting of the U.S. business corporation.

William Lazonick, "Stock Buybacks: From Retain-and-Reinvest to Downsize-and-Distribute," Center for Effective Public Management, Brookings Institution, April 2015 at http://www.brookings.edu/research/papers/2015/04/17-stock-buybacks-lazonick .

See Lazonick's footnoted paper for many loving particulars. Especially note the details of how Rule 10b-18 offers no protection from abuse and (no news to NC readers) is a pillar of general corporate asset-stripping .

Science Officer Smirnoff , May 12, 2017 at 12:43 pm

P. S. pages 10 and 11 of Lazonick's pdf lay out Rule 10b-18 in full.

David Barrera , May 12, 2017 at 12:59 pm

Thanks. Tremendous article!

Socal Rhino , May 12, 2017 at 12:59 pm

Engineering long-term career arc has been an issue since at least my father's generation (those born during WWI). Longer tenure (mid to late mid career) engineers were being eased out for young grads. When I was in a ChemE program in the 70s, advice was to follow the engineering degree with either law or a business degree because the odds of a long career doing engineering was not great. No one advised going for a PhD in engineering.

Arizona Slim , May 12, 2017 at 2:19 pm

My father had a PhD in chemical engineering.

When I asked him why he got the degree, which didn't seem necessary for someone who spent much of his career in industrial R&D, he said, "I'm like Mallory climbing Mount Everest. I got that degree because it is there."

So, there you have it. My old man getting that degree because he wanted to. And because my mother was willing to support both of them while he worked on it.

shinola , May 12, 2017 at 1:02 pm

To me, this is the money quote (literally):

"Many of America's largest corporations routinely distribute more than 100 percent of net income to shareholders, generating the extra cash by reducing cash reserves, selling off assets, taking on debt, or laying off employees the only logical explanation for this buyback activity is that the stock-based pay that represents the vast majority of the remuneration of senior corporate executives incentivizes them to manipulate their companies' stock prices "

This not only applies to the STEM sector, but nearly every large corp. in America. "Earnings quality" (i.e stock price) takes precedence over everything else leading to the crapification of products & services and devaluation of employees.

Thank gawd this type of thinking wasn't around when Jonas Salk was working on the polio vaccine.

nowhere , May 12, 2017 at 2:30 pm

Which begs the question: what discoveries are we missing out on now because of this short sighted approach?

Jim Haygood , May 12, 2017 at 1:27 pm

" In November 1982 the U.S. Securities and Exchange Commission adopted Rule 10b-18 that gave license to massive buybacks, in essence legalizing systemic stock-price manipulation and the looting of the U.S. business corporation. "

How can you have "looting" without lootees? The stockholders aren't complaining. If any party is being disadvantaged by borrowing to fund stock buybacks, it's existing bondholders. As David Swensen describes in an extended example in Pioneering Portfolio Management , managers compensated by stock options tend to treat corporate debt holders quite shabbily by piling on more debt, compromising the interest coverage ratio.

High tech companies use stock buybacks to offset their widespread granting of stock options which - absent Rule 10b-18 - would badly dilute existing stock holders over time.

Trying to paint the well-disclosed practice of stock buybacks as "looting" is histrionic ax grinding on Lazonick's part. Over-leveraged companies are going to regret it in the next recession. But that's a lamentable social phenomenon in a bubble-driven economy. Those who disagree with it are free to sell short over-leveraged stocks - perhaps a more meaningful way of expressing dissent than scribbling academic screeds.

Science Officer Smirnoff , May 12, 2017 at 1:41 pm

And political dissenters are free to emigrate.

fritter , May 12, 2017 at 2:22 pm

Well Jim, ponzi schemes work pretty well for those at the top. I suppose we shouldn't worry about it until we start getting complaints..

Actually though, watching the train wreck that is the outlook for the youngest generation today, provides some grim amusement. For instance noting that the "bubble-driven" economy composed of companies desperate to prevent their stock becoming "badly diluted" by having fire sales on capitol and expertise that probably took their predecessors decades to build can really only have one outcome. Depression, misery, socialism. Maybe we skip the Mao route this time, maybe not.

Alejandro , May 12, 2017 at 2:38 pm

Here's some related "histrionics" of your channeling D.D . an excerpt of a debate about "creative destruction" (emphasis mine) from 1991(context), chronologically, roughly following the tandem of Ronnie and Maggie.

Gregory Peck: "The Robber Barons of old at least left something tangible in their wake - a coal mine, a railroad, banks. THIS MAN LEAVES NOTHING. HE CREATES NOTHING. HE BUILDS NOTHING. HE RUNS NOTHING. And in his wake lies nothing but a blizzard of paper to cover the pain. Oh, if he said, "I know how to run your business better than you," that would be something worth talking about. But he's not saying that. He's saying, "I'm going to kill you because at this particular moment in time, you're worth more dead than alive." https://www.youtube.com/watch?v=xJRhrow3Jws

Danny Devito: "Let's have the intelligence, let's have the decency to sign the death certificate, collect the insurance, and invest in something with a future "Ah, but we can't," goes the prayer. "We can't because we have responsibility, a responsibility to our employees, to our community. What will happen to them?" I got two words for that: WHO CARES? Care about them? Why? They didn't care about you. They sucked you dry. You have no responsibility to them. For the last ten years this company bled your money. Did this community ever say, "We know times are tough. We'll lower taxes, reduce water and sewer."
https://www.youtube.com/watch?v=62kxPyNZF3Q

oho , May 12, 2017 at 1:29 pm

IBM. Poster child of everything wrong at the executive-level and the shareholder-level.

David Barrera , May 12, 2017 at 2:09 pm

Oho,

Yes, the IBM reference is interesting.The author gives an ordinal lead to IBM as a mover from the OEBM to NEBM. I ask myself if, from a mere one large corporation managing perspective, this was IBM's 11th hour response to the by then devastating rise of its competitors like Apple & Microsoft.

Also the irony that it did not help IBM at least in the midterm. So, IBM was the prime mover to initiate some aspects of a model change -change which every major player adhered to- in response to a new technological disadvantage vs. competitors, and in turned did not seem to do much for IBM in the immediate years. Although, if I recall well, IBM was immersed in many political battles and internal problems, legal and otherwise. Nevertheless, I doubt there was a historic inevitability on IBM's ordinal force. Outstanding work by Lazonick

Trout Creek , May 12, 2017 at 3:23 pm

Let me quote a noted tech analyst on IBM :

"IBM is the poster child for shenanigans. Last month, IBM reported its 20th quarter in a row of declining year over year revenues .. a 13% drop in earnings, profit margins that declined in every business segment ( much worse than expected ), free cash flow that plummeted over 50% year over year and an earnings "beat" of 3 cents per share. How could this "beat" happen? .. a negative tax rate of -23% . This is why they pay the CEO Rometti the big bucks ( estimated at $50 to $65 million last year)."

And this is one of the Bluest of the Blue Chip companies in the world.

Sue , May 12, 2017 at 6:12 pm

I read IBM spent a fortune at that time defending itself against monopolistic claims litigation. This was happening while Microsoft and Apple were clearly consolidating their oligopolistic empires. I read reports stating Oracle initial breakthroughs were taken from IBM's research work.

Thomas Williams , May 12, 2017 at 2:04 pm

Really fine piece, thanks. Also, the quality of the readers' comments is some of the highest I've seen in years of following NC

nowhere , May 12, 2017 at 2:35 pm

Not sure if anyone watches "Silicon Valley", but here is a quote that seems fitting:

Season 2 – Bad Money

Richard: Once we get a few customers and start a subscription-revenue model.

Russ: What? Revenue? No, no, no, no, no. No. If you show revenue, people will ask "How much?" And it will never be enough, but if you have no revenue, you can say you're pre-revenue. You're a potential pure play. It's not about how much you earn, it's about what you're worth. And who's worth the most? Companies that lose money. Pinterest, Snap chat No revenue. Amazon has lost money every fucking quarter for the last 20 fucking years, and that Bezos motherfucker is the king.

Wisdom Seeker , May 12, 2017 at 5:50 pm

Just wanted to point out that there is one more link in the chain to be followed: the financiers would not have such an easy time playing Nero with our economy, if the banking sector were still properly constrained by a gold standard (=limited supply of printed credit), the risk of bank runs by outraged consumers, the Glass-Steagall separation of commercial from investment banking, personal rather than corporate punishment for fraud and abuse, antitrust enforcement, etc.

In addition, the rise of 401(k) based investing, in which workers are tax-incentivized to buy in to the corporate stock scheming, but lack the normal shareholder voice in corporate governance, has taken the chains off the looters as well.

It's time to end the impunity. The government has been corrupted by the corporations, so only a populist uprising will produce reform. The uprising will require sacrifices of time, income, security. It will require boycotts of products that people like, but whose producers and vendors are evil. The products will not disappear while demand persists – but the producers and vendors must be brought to heel.

Consider the following inductees into the Corporate Hall of Shame:

pick an industry, you'll find a Hall of Shame candidate. Hit them all in the wallet until they reform.

Smitty , May 12, 2017 at 5:53 pm

The impact on the Grads was secondary a byproduct of a larger agenda which included the transfer offshore and consolidation of "IP" of the entire American, EU and Asian industrial economies along with the withdrawl of capital, while at the same time intentionally sabotaging future innovations with the handicap of diversity. Who got the loot and capital? Usual suspects.

[Apr 11, 2017] Trump administration betrayed students depply in debt

Apr 11, 2017 | economistsview.typepad.com

im1dc April 11, 2017 at 04:48 PM SoE DeVos is dangerously stupid and incompetent

"DeVos's decision to reverse some of her work "with no coherent explanation or substitute" effectively means that the Trump administration is placing the welfare of loan contractors above those of student debtors"

https://www.bloomberg.com/news/articles/2017-04-11/devos-undoes-obama-student-loan-protections

"DeVos Undoes Obama Student Loan Protections"

'Trump's education secretary wants to limit costs at a time when more than 1 million Americans are annually defaulting'

by Shahien Nasiripour...April 11, 2017...2:46 PM EDT

"Education Secretary Betsy DeVos on Tuesday rolled back an Obama administration attempt to reform how student loan servicers collect debt.

Obama issued a pair (PDF) of memorandums (PDF) last year requiring that the government's Federal Student Aid office, which services $1.1 trillion in government-owned student loans, do more to help borrowers manage, or even discharge, their debt. But in a memorandum (PDF) to the department's student aid office, DeVos formally withdrew the Obama memos.

The previous administration's approach, DeVos said, was inconsistent and full of shortcomings. She didn't detail how the moves fell short, and her spokesmen, Jim Bradshaw and Matthew Frendewey, didn't respond to requests for comment.

DeVos's move comes a week after one of the student loan industry's main lobbies asked for Congress's help in delaying or substantially changing the Education Department's loan servicing plans. In a pair of April 4 letters to leaders of the House and Senate appropriations committees, the National Council of Higher Education Resources said there were too many unanswered questions, including whether the Obama administration's approach would be unnecessarily expensive.

A recent epidemic of student loan defaults and what authorities describe as systematic mistreatment of borrowers prompted the Obama administration, in its waning days, to force the FSA office to emphasize how debtors are treated, rather than maximize the amount of cash they can stump up to meet their obligations.

Obama's team also sought to reduce the possibility that new contracts would be given to companies that mislead or otherwise harm debtors. The current round of contracts will terminate in 2019, and among three finalists for a new contract is Navient Corp. In January, state attorneys general in Illinois and Washington, along with the U.S. Consumer Financial Protection Bureau, or CFPB, sued Navient over allegations the company abused borrowers by taking shortcuts to boost its own bottom line. Navient has denied the allegations.

The withdrawal of the Obama administration guidelines could make Navient a more likely contender for that contract, government officials said. Navient shares moved higher after the government released DeVos's decision around 11:30 a.m. New York time. Navient stock ended up almost 2 percent.

The Obama administration vision for how federal loans would be serviced almost certainly meant the feds would have to increase how much they pay loan contractors to collect monthly payments from borrowers and counsel them on repayment options. Already, the government annually spends around $800 million to collect on almost $1.1 trillion of debt. DeVos, however, made clear that her department would focus on curbing costs.

"We must create a student loan servicing environment that provides the highest quality customer service and increases accountability and transparency for all borrowers, while also limiting the cost to taxpayers," DeVos said.

With her memo, DeVos has taken control of the complex and widely derided system in which the federal government collects monthly payments from tens of millions of Americans with government-owned student loans. The CFPB said in 2015 that the manner in which student loans are collected has been marred by "widespread failures."

DeVos's move "will certainly increase the likelihood of default," said David Bergeron, a senior fellow at the Center for American Progress, a Washington think tank with close ties to Democrats. Bergeron worked under Democratic and Republican administrations over more than 30 years at the Education Department. He retired as the head of postsecondary education.

During Obama's eight years in office, some 8.7 million Americans defaulted on their student loans, for a rate of one default roughly every 29 seconds.

Former Deputy Treasury Secretary Sarah Bloom Raskin worked on student loan policy during the latter years of the Obama administration, in part over concern that borrowers' struggles were affecting the management of U.S. debt. DeVos's decision to reverse some of her work "with no coherent explanation or substitute" effectively means that the Trump administration is placing the welfare of loan contractors above those of student debtors, she said.

In a statement Tuesday, Illinois Attorney General Lisa Madigan, who is suing Navient, agreed: "The Department of Education has decided it does not need to protect student loan borrowers."
libezkova -> im1dc... , April 11, 2017 at 05:24 PM

Thank you ! A very good finding.

[Apr 04, 2017] In Neo-classical Economics as a Stratagem Against Henry George

Notable quotes:
"... As with any major reform movement, the corporate backlash was predictable. In Neo-classical Economics, Gaffney reveals that this backlash took two main forms. The first was the Red Scare (1919-1989), overseen by J Edgar Hoover as Assistant Attorney General and later as FBI director. ..."
"... The second was more insidious and involved the deliberate reframing of the classical economic theory developed by Adam Smith, Locke, Hume, and Ricardo as so-called neoclassical economics. ..."
Apr 04, 2017 | economistsview.typepad.com
RGC , April 03, 2017 at 06:36 AM
Karl Marx vs Henry George

by Stuart Jeanne Bramhall / August 12th, 2013


Why do American children study Karl Marx, the villain we love to hate, in school? Yet Henry George, whose views on land and tax reform gave rise to the Progressive and Populist movements of the 1900s, is totally absent from US history books.

During the 1890s George, author of the 1879 bestseller Progress and Poverty, was the third most famous American, after Mark Twain and Thomas Edison. In 1896 he outpolled Teddy Roosevelt and was nearly elected mayor of New York.

In Neo-classical Economics as a Stratagem Against Henry George (2007), University of California economist Mason Gaffney argues that George and his Land Value Tax pose a far greater threat than Marx to America's corporate elite.

America's enormous concentration of wealth has always depended on the inherent right of the wealthy elite to seize and monopolize vast quantities of land and natural resources (oil, gas, forests, water, minerals, etc) for personal profit.

Adopting an LVT, which is far easier than launching a violent revolution, would essentially negate that right. What's more, every jurisdiction that has ever implemented an LVT finds it works exactly the way George predicted it would. Productivity, prosperity, and social wellbeing flourish, while inflation, wealth inequality, and boom and bust recessions and depressions virtually vanish.

When Progress and Poverty first came out in 1879, it started a worldwide reform movement that in the US manifested in the fiercely anti-corporate Populist Movement in the 1880s and later the Progressive Movement (1900-1920). Many important anti-corporate reforms came out of this period, including the Sherman Antitrust Act (1890), a constitutional amendment allowing Americans to elect the Senate by popular vote (prior to 1913 the Senate was appointed by state legislators), and the country's first state-owned bank, The Bank of North Dakota (1919).

The Corporate Elite Strikes Back

As with any major reform movement, the corporate backlash was predictable. In Neo-classical Economics, Gaffney reveals that this backlash took two main forms. The first was the Red Scare (1919-1989), overseen by J Edgar Hoover as Assistant Attorney General and later as FBI director.

The second was more insidious and involved the deliberate reframing of the classical economic theory developed by Adam Smith, Locke, Hume, and Ricardo as so-called neoclassical economics.

The latter totally negates Adam Smith's basic differentiation between "land", a limited, non-producible resource. and "capital", a reproducible result of past human production. Smith, Locke, Hume, and Ricardo all held that individuals have no right to seize and monopolize scarce natural resources, such as land, minerals, water, and forests. They believed that because these resources are both limited and essential for human survival, they should belong to the public.

Neoclassical economics, which first developed in the 1890s, was based on the premise that growth and development can only occur if a handful of rent-seekers are allowed to monopolize scarce land and natural resources for their personal profit. Henry George, who publicly debated the early pioneers of neoclassical economics, claimed the science of economics was being deliberately distorted to discredit him. Gaffney agrees. Because George's proposal to replace income and sales tax with single land value taxed is based on logical concepts of land, capital, labor, and rent advanced by Adam Smith, Locke, Hume, and Ricardo, they all had to be discredited.

Gaffney believes neoclassical economic theory undermines George's arguments for a single Land Value Tax in two basic ways: 1) by claiming that land is no different from other capital (ironically Marx made the identical argument) and 2) by portraying the science of economics as a series of hard choices and sacrifices that low and middle income people must make. Some examples:

If we want efficiency, we must sacrifice equity.

To attract business, we must lower taxes and shut libraries and defund schools.

To prevent inflation, we must keep a large number of Americans unemployed.

To create jobs, we must destroy the environment and pollute the air, water, and food chain.

To raise productivity, we must fire people.

Gaffney's book traces the phenomenal public support Georgism enjoyed before the tenets of neoclassical economics took hold in American universities. In addition to inspiring the Populist and Progressive movements, an LVT to fund irrigation projects in California's Central Valley made California the top producing farm state. In 1916 the first federal income tax law was introduced by Georgist members of Congress (Henry George Jr and Warren Bailey) and included virtually no tax on wages. In 1934 Georgist Upton Sinclair was almost elected governor of California.


Gaffney also identifies the robber barons whose fortunes financed the economics departments of the major universities who went on to substitute neooclassical economics for classical economic theory. At the top of this list were

Ezra Cornell (owner of both Western Union and Associated Press) – founder of Cornell University

John D Rockefeller – helped fund the University of Chicago and installed his cronies in its economics department.

J. P Morgan – investment banker and early funder of Columbia University

B&O Railroad – John Hopkins University

Southern Pacific Railroad – Stanford University

The final section of Gaffney's book lays out the tragic economic, political, and social consequences of allowing the Red Scare and neoclassical economics to stifle America's movement for a single Land Value Tax:

Economic Consequences

The corporate elite has privatized, or is privatizing, most of the public domain (including fisheries, the public airwaves, water, offshore oil and gas, and the right to clean air) without compensation to the public.

The rate of saving and capital formation continues to fall rapidly. This is the main reason there is no recovery.
Although profits soar, corporations have no incentive to invest in expansion and jobs. Instead they invest their profits in real estate, derivatives, and commodities speculation.

American capital is decayed and obsolete. The US has lost much of its steel and auto industries. Power plants and oil refineries are ancient and polluting. Most public capital (infrastructure) is old and crumbling.

The number of American farms has fallen from 6 million in 1920 to 1 million in 2007.

The USA, once so self-sufficient, has grown dangerously dependent on importing raw materials and foreign manufacturers.

The US financial system is a shambles, supported only by loading trillions of dollars of bad debts onto the taxpayers.

Real wage rates have continued to fall since 1975,
Unemployment has risen to chronically high levels.
Inequality in wealth and income continues to increase rapidly.

Political Consequences

The corporate elite has nullified all the Progressive Era electoral reforms by pouring money into politics and "deep lobbying," at all levels of government, including our institutions of higher learning and our public schools.

The corporate elite continue to pour ever more of our tax money into prisons.

Social Consequences

Homelessness has risen to new heights, in spite of decades of subsidies to home-building and, favorable tax treatment of owner-occupied homes

Hunger is rampant.

Street begging, once rare, is everywhere

Americans have experienced a sharp loss of community, honor, duty, loyalty and patriotism.

In the shadow world between crime and business there is now the vast, gray underground economy that includes tax evasion, tax avoidance, and drug-dealing.

The US which once led the world in nearly every endeavor, has fallen far behind in infant survival, in longevity, in literacy, in numeracy, in mental health.

American education no longer leads the world. Privatized education in the form of commercial TV has largely superseded public education.

http://dissidentvoice.org/2013/08/karl-marx-vs-henry-george/

[Apr 01, 2017] The General Theory of Employment, Interest, and Money

Apr 01, 2017 | economistsview.typepad.com
anne -> RC AKA Darryl, Ron... , April 01, 2017 at 11:43 AM
http://ebooks.adelaide.edu.au/k/keynes/john_maynard/k44g/chapter12.html

1936

The General Theory of Employment, Interest, and Money
By John Maynard Keynes

The State of Long-Term Expectation

[ The passage is important, but a reference is ecessary. ]

[Mar 31, 2017] Professor Thoma has the unique ability to pick up interesting links.

Mar 31, 2017 | economistsview.typepad.com
Peter K. , March 31, 2017 at 05:42 AM
David Glasner discusses how essential Professor Thoma's blog is to the Econosphere... Funny given that the web address for Uneasy Money refuses appear in Typepad.

A Tale of Three Posts
by David Glasner

March 30, 2017

Since I started blogging in July 2011, I have published 521 posts (not including this one). A number of my posts have achieved a fair amount of popularity, as measured by the number of views, which WordPress allows me to keep track of. Many, though not all, of my most widely viewed posts were mentioned by Paul Krugman in his blog. Whenever I noticed an unusually large uptick in the number of viewers visiting the blog, I usually found Krugman had linked to my post, causing a surge of viewers to my blog.

The most visitors I ever had in one day was on August 7, 2012. It was the day after I wrote a post mocking an op-ed in the Wall Street Journal by Arthur Laffer ("Arthur Laffer, Anti-Enlightenment Economist") in which, based on some questionable data, and embarrassingly bad logic, Laffer maintained that countries that had adopted fiscal stimulus after the 2008-09 downturn had weaker recoveries than countries that had practiced fiscal austerity. This was not the first or last time that Krugman linked to a post of mine, but what made it special was that Krugman linked to it while he on vacation, so that for three days, everyone who visited Krugman's blog found his post linking to my post, so that on August 7 alone, my post was viewed 7885 times, with 3004 viewing the post on August 8, 1591 on August 9, and 953 on August 10. In the entire month of August, the Laffer post was viewed 15,399 times. To this day, that post remains the most viewed post that I have ever written, having been viewed a total 17,604 times.

As you can see, the post has not maintained its popular appeal, over 87 percent of all views having occurred within three and a half weeks of its having been published. And there's no reason why it should have retained its popularity. It was a well-written post, properly taking a moderately well-known right-wing economist to task for publishing a silly piece of ideological drivel in a once-great newspaper, but there was nothing especially profound or original about it. It was just the sort of post that Krugman loves to link to, and I was at the top of his blog for three days before he published his next post.

...

But over the past six months, suddenly since October, a third post ("Gold Standard or Gold Exchange Standard: What's the Difference?"), originally published on July 1, 2015, has been attracting a lot of traffic. When first published, it was moderately successful, drawing 569 visits on July 2, 2015, which is still the most visits it has received on any single day, mostly via links from Mark Toma's blog and Brad DeLong's blog. The post was not terribly original, but I think it did a nice job of describing that evolution of the gold standard from an almost accidental and peculiarly British, institution into a totem of late nineteenth-century international monetary orthodoxy, whose principal features remain till this day surprisingly obscure even to well trained and sophisticated monetary economists and financial experts.

...

The other amazing thing about the burst of traffic to this post is that most of the visitors seem to be coming from India. Over the past 30 days since February 28, this blog has been viewed 17,165 times. The most-often viewed post in that time period was my gold-exchange standard post, which was viewed 7385 times, i.e., over 40% of all views were of that one single post. In the past 30 days, my blog was viewed from India 6446 times while my blog was viewed from the United States only 4863 times. Over the entire history of this blog, about 50% of views have been from within the US. So India is clearly where it's at now.

...

PS I realized that, by identifying Paul Krugman's blog as the blog from which many of my most popular posts have received the largest number of viewers, I inadvertently slighted Mark Thoma's indispensible blog (Economistsview.typepad.com), which really is the heart and soul of the econ blogosphere. I just checked, and I see that since my blog started in 2011, over 79,000 viewers have visited my blog via Mark's blog compared to 53,000 viewers who have visited via Krugman. And I daresay that when Krugman has linked to one of my posts, it's probably only after he followed Thoma's link to my blog, so I'm doubly indebted to Mark.

Peter K. -> pgl... , March 31, 2017 at 05:57 AM
High praise from Glasner:

"Mark Thoma's indispensible blog (Economistsview.typepad.com), which really is the heart and soul of the econ blogosphere."

Too bad you and people like you are trying to ruin it with your bullying and trolling.

Peter K. -> Peter K.... , March 31, 2017 at 06:09 AM
I also enjoy David Beckworth's podcasts. Funny enough Typepad doesn't like his website either.

His latest podcast with Jeffrey Frankel is good.

http://macromarketmusings blogspot com/2017/03/macro-musings-podcasts-jeffrey-frankel.html

At the end they have a good discussion about NGDP targetting.

I really don't understand why progressive economists don't get behind this more. The more mainstream economists seem more interested in promoting the Democrats' policy agenda and defending it from the left and from the right.

Economists could/can help social movements push policies like a higher minimum wage, UBI, guaranteed jobs, unionization/economic democracy and an NGDP target for the Fed.

Seems like Progressive [center-left] economists are more interested in defending the Federal Reserve except for DeLong who criticizes it in an indirect, oblique manner. They're in a defensive crouch all of the time.

Seems like a big blind spot to me.

paine -> Peter K.... , March 31, 2017 at 09:08 AM
The comments should never be confused
with the posts and posted links
Conjecture

We commenteers long dince lost

Large readership

Peter K. -> paine... , March 31, 2017 at 10:16 AM
"The comments should never be confused with the posts and posted links"

Did I confuse them?

libezkova -> paine... , March 31, 2017 at 10:32 AM
"The comments should never be confused with the posts and posted links"

That's wrong ! There is a strong interdependency.

Professor Thoma has the unique ability to pick up interesting links. I wonder where he finds time to read all those articles, as probably to post a dosen of links, as he often does, you need to read at least twice more articles. Probably much more the twice.

I think that this quality attracts a lot of people.

And I noticed that on average, his "Links" posts attract more comments that regular posts. Probably by the factor of two on average. Most Links posts attract over 100 comments with high number around 300.

It might also be that commenting on "Links", commenters often post their own findings and quotes, which sometimes is of high, or very high value and add to the value. Anne is one such persons.

Another interesting feature of this blog is that the "core" group of commenters is reasonably stable with many commenting for five years or more. I belong to "episodical" commenters, but I follow the blog for a long time and after a couple of years I start recognizing probably 80% of names and even now has some vague information about their personal histories.

And some of the members of the core group systematically produce a number of high quality comments almost each day. That also attracts people.

Discussions, when two commenters have opposite views of the subject to me is the most interesting part. Despite occasional shouting matches.

So it is the quality of links and posts attracts quality commenters, which in turn, further enhance the quality of the blog.

In any case: Bravo Professor Thoma !!!

Julio -> libezkova... , March 31, 2017 at 11:26 AM
Absolutely! I was originally attracted to this blog by the quality of the comments even more than the quality of Prof. Thoma's selections.

It's ironic that paine seems to be arguing that comments are relatively unimportant. His posts are always thought-provoking and foster good discussions, and one of the reasons I became a regular reader.

[Mar 31, 2017] How America's Most Prestigious Universities Bilk the U.S. Taxpayer Zero Hedge

Mar 31, 2017 | www.zerohedge.com

alphasammae , Mar 30, 2017 9:30 PM

Ivy League alumni like the illuminatis Clinton and Bushes are prepared and vetted to run Goldman Sachs, the White House and the justice system etc. A merry go 'round, this for that but at the end rather than creating personal foundations they should be creating foundations for their alma mater instead of their library mausoleum. Clinton foundation raised over $1.2 billion to be run by daughter. Sick.

old_cynic , Mar 30, 2017 11:21 PM

Flawed, sensationalistic report, clickbait for jealous masses who can't make the cut into the ivy league.

Most of the $ comes from research grants. Wouldn't you expect the best schools in the country to get research grants? Look at all the top state schools, they also attract loads of federal $.

As for endowment income being non-taxable for universities, that's a good thing IMO. Would you rather have the endowment funds for all other nonprofits taxed too? Think about hospitals and churches as examples.

dvfco -> buckstopshere , Mar 30, 2017 8:58 PM

$71,000+ for incoming class at Georgetown this fall.

$0 at U.S. Naval Academy.

Hmmm.

Cardinal Fang , Mar 30, 2017 6:19 PM

It's a big club and you ain't in it.

I worked for a Billionaire who actually said this to me.

He meant it.

This is how they think.

Notice I said 'worked'...

He tried to be a man of the people but couldn't fake it at times.

No_More , Mar 30, 2017 6:35 PM

At $120K/student/year, I'd consider perpetual studenthood at an Ivy (assuming the $120K was paid direct to me).

Talk about your pricey name brand Free Shit though (as compared to SNAP or an ObamaPhone).

pitz , Mar 30, 2017 7:32 PM

The Ivy League universities are also prolific H-1B abusers, and they use tax-free "scholarship" endowment fund earnings to advance their liberal causes.

Time to tax them properly and stop the scam of 'scholarships' and H-1B abuse.

khakuda , Mar 30, 2017 7:44 PM

Harvard and Yale each have endowments on the order of $25-$35 billion, yet always have their hands out for more.

Anteater , Mar 30, 2017 7:56 PM

The US has 1,000 Generals. Count 'em. We have 33 brigade combat teams, who comprise in battalions, companies and platoons, roughly 1,000 combat platoons. Do the math. We have so many excess Generals, each General could partner with an LT leading a platoon into battle. That's FU. Let's cut that number back to 33, one per BCT, and find KP duty for the 967, until they find the $6,000,000,000,000 of our last life savings that the Pentagon 'lost track of' and is now forever MIA.

The US has 1,000 Admirals. Count 'em. We have 430 fighting ships, if you go all the way down to fuel barges, PT boats and LSTs. Do the math. We have so many excess Admirals, each Admiral could partner with an LT leading an LST onto the beach, and still have 570 Admirals to wade ashore and declare the beachhead secured. That's FU. Let's cut that number back to 7, one per fleet, and find KP duty for the 993, until they find the $6,000,000,000,000 of our last life savings that the Pentagon 'lost track of' and is now forever MIA.

Somebody knows where our savings went! There are over 1800 unnecessary Admirals and Generals who could defend America and earn their $250,000 a year salaries for life, by ferreting out the moles, rats, leeches and gribbles at the Pentagon, clean house, right-size the armed forces, re-fund yhe VA, then hang all the MIC lobbyists from the yardarms for treason.

Faeriedust -> Anteater , Mar 30, 2017 9:06 PM

It's worse. From having relatives inside the Pentagon budget process, I've been made aware for decades that at least 1/3 of our military manpower exists not because there is any rational need for those troops, OTHER than having sufficient forces to justify retaining and promoting more high-ranking (and highly-paid) Brass.

The hierarchical structure of the military assures that there are relatively few pay billets at the top. This means that officers sitting on promotion boards are constantly faced with the demand to "pass over" and thus doom to early separation/retirement fellow officers who are perfectly competent at their jobs, just not needed by the numbers.

In the immediate post WWII era, service leaders were nervous about letting good talent go and get settled in civilian life, only to need them for the Next Big One in a few years' time. Those few years have since become six decades, and the system of holding onto popular people by "creative" billeting has become institutionalized. The Armed Forces DON'T need AT LEAST 1/3 of their personnel, especially in the higher ranks. But the higher the rank, the more personal favors are owed to them, and the more likely that a new job will be created requiring even more stars, in order to assure that they stay employed at least until they can collect retirement.

The Pentagon is the world's one and and only truly functional socialist system.

[Mar 29, 2017] The reason UK economics students revolted

Notable quotes:
"... And that's the reason UK economics students revolted: "Few mainstream economists predicted the global financial crash of 2008 and academics have been accused of acting as cheerleaders for the often labyrinthine financial models behind the crisis. Now a growing band of university students are plotting a quiet revolution against orthodox free-market teaching, arguing that alternative ways of thinking have been pushed to the margins. ..."
"... why economists failed to warn about the global financial crisis and for having too heavy a focus on training students for City jobs. ..."
"... But the answer to their question is very simple. Neoliberals are in power and they dictate what is to be taught in Economics courses. They also promote and sustain "willing charlatans" like Mankiw, who poisons and indoctrinates students with neoclassical junk. ..."
Mar 29, 2017 | economistsview.typepad.com
JohnH -> Peter K.... , March 27, 2017 at 06:51 PM
So true; "SWL has never addressed what is happening in the real world."

And that's the reason UK economics students revolted: "Few mainstream economists predicted the global financial crash of 2008 and academics have been accused of acting as cheerleaders for the often labyrinthine financial models behind the crisis. Now a growing band of university students are plotting a quiet revolution against orthodox free-market teaching, arguing that alternative ways of thinking have been pushed to the margins.

Economics undergraduates at the University of Manchester have formed the Post-Crash Economics Society, which they hope will be copied by universities across the country. The organisers criticise university courses for doing little to explain why economists failed to warn about the global financial crisis and for having too heavy a focus on training students for City jobs."
https://www.theguardian.com/business/2013/oct/24/students-post-crash-economics

... ... ...

libezkova -> JohnH... , March 27, 2017 at 09:40 PM
"why economists failed to warn about the global financial crisis and for having too heavy a focus on training students for City jobs."

https://www.theguardian.com/business/2013/oct/24/students-post-crash-economics"

That's a very good link. Thank you !

But the answer to their question is very simple. Neoliberals are in power and they dictate what is to be taught in Economics courses. They also promote and sustain "willing charlatans" like Mankiw, who poisons and indoctrinates students with neoclassical junk.

[Mar 28, 2017] It is ironic that Krugman is cited as a voice for reform -- he represents the neo-Keynesian hell weve got stuck in

Notable quotes:
"... Ironic that Krugman is cited as a voice for reform - he represents the neo-Keynesian hell we've got stuck in. ..."
"... I'm an economics student at the University of Glasgow, in second year as part of a compulsory course we were taught about alternative economic theories in comparison to Neoclassical models. ..."
"... The course has only been running for a few years but in response students have set up a very similar society to promote alternative thinking on economics. Even just half a semester on Post-Keynesian Economic theory has really opened our eyes to the alternatives within economics. ..."
"... I studied neoclassical 'economics' (it really isn't economics, just garbage) for five years. Began to take my graduate degree in the autumn of 2008 when everything was falling apart and I had no idea why. No clue whatsoever. After my masters degree in neoclassical 'economics' I still had no clue what had happened. ..."
"... Orthodox economics: Ignore money. Hence, ignore debt. Let the overall leverage of the economy increase until Ponzi finance fails and financial crisis begins. The debt deflation that follows means money gets even more concentrated towards the financial/political elite than before the crisis. Neo-feudalism makes way - finally war. ..."
"... Orthodox economists don't understand capitalism. They can't. The long time failed axioms underlying everything else in their theories don't allow them to do that. ..."
Mar 28, 2017 | discussion.theguardian.com
Febo , 25 Oct 2013 15:16

Ironic that Krugman is cited as a voice for reform - he represents the neo-Keynesian hell we've got stuck in.

JmkSweeney, 25 Oct 2013 18:46

I'm an economics student at the University of Glasgow, in second year as part of a compulsory course we were taught about alternative economic theories in comparison to Neoclassical models.

The course has only been running for a few years but in response students have set up a very similar society to promote alternative thinking on economics. Even just half a semester on Post-Keynesian Economic theory has really opened our eyes to the alternatives within economics.

DisconnectMe -> JmkSweeney , 26 Oct 2013 13:54

I studied neoclassical 'economics' (it really isn't economics, just garbage) for five years. Began to take my graduate degree in the autumn of 2008 when everything was falling apart and I had no idea why. No clue whatsoever. After my masters degree in neoclassical 'economics' I still had no clue what had happened.

Then I stumbled across Post-Keynesian economics and it took me about six months to dismiss the neoclassical garbage. If I hadn't studied that garbage for five years it would have taken me a few days.

DisconnectMe , 26 Oct 2013 02:42

Orthodox economics: Ignore money. Hence, ignore debt. Let the overall leverage of the economy increase until Ponzi finance fails and financial crisis begins. The debt deflation that follows means money gets even more concentrated towards the financial/political elite than before the crisis. Neo-feudalism makes way - finally war.

Then the cycle starts again.

Orthodox economists don't understand capitalism. They can't. The long time failed axioms underlying everything else in their theories don't allow them to do that.

What a waste of economic thinking.

[Mar 28, 2017] Economics taught by neo-classical economics is like the Natural Sciences departments being run by creationists

Notable quotes:
"... This has echoes of a protest by students in 2011 at Harvard when a group of students walked out of the lectures by Dr Gregory Manilow. What has happened to them? ..."
"... Good for them. The economics profession has been dominated by neoliberal theoreticians for far too long. It needs bringing back to the real world. ..."
"... i went to the LSE to study maths and statistics with a sprinkling of economics (my first taste of it at the time). after a few months i was of the opinion it is based on terrible assumptions. e.g. the needs of the average consumer, which are then blown up into fantastical macroeconomical proportions which only led to flawed arguments. The subsequent financial crisis only backed this up. ..."
Mar 28, 2017 | discussion.theguardian.com
RobinS , 25 Oct 2013 5:20

What a ghastly indictment of Manchester, and other economics departments - obviously being very economic with their subject. Sounds a bit like the Natural Sciences departments being run by creationists.

ResponsibleWellbeing , 25 Oct 2013 5:23

This should be the first class for the whole students in economics.
What are the limits in ecology ecosystem? And what are the needs/capacities for human flourishing?

Adventures in New Economics 2: Donut Economics, Kate Raworth

http://www.youtube.com/watch?v=VieEtdcmjtI

This is an open/complex map with a compass in values that I've built trying to go through both main concepts. It's valid for personal development / companies / communities / nations / whole planet.

bit.ly/1775pbV

Jed Bland , 25 Oct 2013 5:36

This has echoes of a protest by students in 2011 at Harvard when a group of students walked out of the lectures by Dr Gregory Manilow. What has happened to them?

I personally have observed in other disciplines that teaching tends to be a generation behind current thinking, Particularly when it has more to do with ideology than science.

Some ten years ago, a movement called the Post-Autistic Ecomoncs Movement had a considerable influence in Europe but has no doubt disappeared in the face of the greed which is central supporting feature of today's neoliberalism.

SteveTen , 25 Oct 2013 5:44

Good for them. The economics profession has been dominated by neoliberal theoreticians for far too long. It needs bringing back to the real world.

skyblueravo , 25 Oct 2013 5:45

i went to the LSE to study maths and statistics with a sprinkling of economics (my first taste of it at the time). after a few months i was of the opinion it is based on terrible assumptions. e.g. the needs of the average consumer, which are then blown up into fantastical macroeconomical proportions which only led to flawed arguments. The subsequent financial crisis only backed this up.

I commend this thinking by the students but if I was one of their parents forking out 27k i would probably tell them to pass the exams they need to and get out and start earning.

LSE is a godawful uni also, unless you have given spawn to gordon gekko dont bother with it.

kongshan , 25 Oct 2013 5:46

Alternative theories and models??? Well they are currently practiced by North Korea and these students will be more than welcomed by the Kim family to ply their trade there.

UnlearningEcon -> kongshan , 25 Oct 2013 7:58

Actually, "alternative theories" were practiced by South Korea, which has been quite a success story. It's not either the status quo or state communism, you know.

[Mar 28, 2017] The robber barons and their useful idiots have certainly achieved what they set out to do.

Mar 28, 2017 | discussion.theguardian.com
radicalchange 25 Oct 2013 6:41

For an understanding of how we came to have thrust upon us the "Dismal Science" of neo-classical economics, which took shape in the 1880's - 1890's, I recommend reading "The Corruption of Economics" by Mason Gaffney.

Here is a link to some excerpts from his book,
http://www.politicaleconomy.org/gaffney.htm

Essentially, economic thinking was hijacked by the robber barons who through building and funding universities were able to subvert the teaching of economics to suit their own agenda. Classical economics with a sound basis of three factors of production was replaced by voodhoo economics which reduced the three factors of production to only two. Whereas once "land" was a factor of production in its own right alongside "capital" and "labour", it was magicked away to be incorporated as "capital" for the purpose of the land owning robber barons.

As anyone with a few braincells would know, "land" is a distinct factor of production in its own right, and not only that, it is the primary factor since neither "capital" or "labour" would exist without it. But "land" can exist without both the other two factors which makes it unique and makes it primary and yet voodhoo economics has managed to hide this fact so well through the employment of clever mathematics to create an illusion of being a solid discipline.

http://www.henrygeorge.org/pcontents.htm

Neoclassical economics is the idiom of most economic discourse today. It is the paradigm that bends the twigs of young minds. Then it confines the florescence of older ones, like chicken-wire shaping a topiary. It took form about a hundred years ago, when Henry George and his reform proposals were a clear and present political danger and challenge to the landed and intellectual establishments of the world. Few people realize to what a degree the founders of Neoclassical economics changed the discipline for the express purpose of deflecting George, discomfiting his followers, and frustrating future students seeking to follow his arguments. The stratagem was semantic: to destroy the very words in which he expressed himself.


To most modern readers, probably George seems too minor a figure to have warranted such an extreme reaction. This impression is a measure of the neo-classicals' success: it is what they sought to make of him. It took a generation, but by 1930 they had succeeded in reducing him in the public mind. In the process of succeeding, however, they emasculated the discipline, impoverished economic thought, muddled the minds of countless students, rationalized free-riding by landowners, took dignity from labor, rationalized chronic unemployment, hobbled us with today's counterproductive tax tangle, marginalized the obvious alternative system of public finance, shattered our sense of community, subverted a rising economic democracy for the benefit of rent-takers, and led us into becoming an increasingly nasty and dangerously divided plutocracy.

Not one economics graduate have I met that has heard of Henry George but yet they have all heard of Karl Marx. The robber barons and their useful idiots have certainly achieved what they set out to do.

radicalchange -> radicalchange , 25 Oct 2013 6:45

As clarification the two paragraphs in italics are excerpts from the "Corruption of Economics" by Mason Gaffney. The link to Henry George's "Progress and Poverty" is, http://www.henrygeorge.org/pcontents.htm

[Mar 28, 2017] I taught Economics for forty years and over 30 of those to Singaporean scholars destined to Oxford, Cambridge and Ivy League universities; in all those years I was aware of the lies I had to teach in order to pass university entrance exams.

Notable quotes:
"... Then Economic History was virtually withdrawn from university Economics and other courses so that only the"lies" would be taught backed up by unquestioned (i.e. purely deductive) Mathematics. It is an academic crime ..."
Mar 28, 2017 | profile.theguardian.com
ptah , 25 Oct 2013 7:55

If a viable economic solution emerged from the universities - one which remedied the classical models and trumped the broken neo-liberal systems, how would we recognise it?

To provide some context - and I am in no way qualified to discuss this topic really but, the first machines to produce logic emerging from Bletchley park were not fully recognised for their potential - the computer revolution took place elsewhere. The UK is absolute rubbish at recognising innovation!

Good luck to the students. I hope many more get involved in this debate.

ID2322670 , 25 Oct 2013 8:24

I taught Economics for forty years and over 30 of those to Singaporean scholars destined to Oxford, Cambridge and Ivy League universities; in all those years I was aware of the lies I had to teach in order to pass university entrance exams.

I attempted to follow the thesis that every economic theory however old or new was attempting to answer a unique contemporary economic problem and therefore only Economic History was of relevance in understanding a theory be Adam Smith or Keynes or even (unacademically) Thatcherism.

My students found all such information useless to passing Economics exams but interesting for "life".

Then Economic History was virtually withdrawn from university Economics and other courses so that only the"lies" would be taught backed up by unquestioned (i.e. purely deductive) Mathematics. It is an academic crime.

[Mar 28, 2017] Zombie theories continue on their path of destruction.

Notable quotes:
"... Neoliberal economics not only led to the crash of 2007/8 it is continuing to wreak havoc. A good current example is pension schemes - something we will depend on one day. They are valued using the purest form of free market thinking: the efficient markets hypothesis - the idea that asset markets always perfectly embody all relevant information. It is akin to belief in magic. ..."
"... It is amazing to read how narrow economics education is in modern Britain. It is not only intellectually unenlightened and literally dangerous, given the power many economics graduates can wield, amplified by the extraordinary sums and resources they manage, it also does a great disservice to people who are entitled to a proper education which, clearly, they are not receiving in this monotheistic model. ..."
"... It reminds me precisely of the so-called "religious education" I received in Ireland which was nothing of the sort. All I got was instruction in Catholic doctrine and ethics; there was no instruction in the beliefs of any other Christian sects, let alone what goes on in the other major world religions such as Hinduism, Judaism, or Islam. What I know about them I taught myself in later life. ..."
"... It seems that the same shameful parochial narrowness, intellectual provincialism, and "one true religion" ethic prevails in British economic so-called "education". ..."
"... On another matter, the revelation that economists "ignore empirical evidence that contradicts mainstream theories" destroys any notion that economics is a science, a silly claim I have always opposed. All that it reveals is that economists have no idea what science is. ..."
Mar 28, 2017 | discussion.theguardian.com
harrybuttle, 26 Oct 2013 7:25

Neoliberal economics not only led to the crash of 2007/8 it is continuing to wreak havoc. A good current example is pension schemes - something we will depend on one day. They are valued using the purest form of free market thinking: the efficient markets hypothesis - the idea that asset markets always perfectly embody all relevant information. It is akin to belief in magic.

Yet many professionals who run pension schemes and the government regulator all support it's use because it suits them - it deflects responsibility from them while they continue to be paid. It's effects on society are disastrous as it leads us to believe are insolvent. The government and actuarial profession accepted all this and enshrined it in law.

A topical example is the universities pension scheme the USS which BBC Newsnight and Radio 4 have just told us has a 'black hole' of a deficit.

Many of us thought that the EMH would ditched after its spectacular failure but no. Zombie theories continue on their path of destruction.

Josifer , 27 Oct 2013 01:00
It is amazing to read how narrow economics education is in modern Britain. It is not only intellectually unenlightened and literally dangerous, given the power many economics graduates can wield, amplified by the extraordinary sums and resources they manage, it also does a great disservice to people who are entitled to a proper education which, clearly, they are not receiving in this monotheistic model.

It reminds me precisely of the so-called "religious education" I received in Ireland which was nothing of the sort. All I got was instruction in Catholic doctrine and ethics; there was no instruction in the beliefs of any other Christian sects, let alone what goes on in the other major world religions such as Hinduism, Judaism, or Islam. What I know about them I taught myself in later life.

It seems that the same shameful parochial narrowness, intellectual provincialism, and "one true religion" ethic prevails in British economic so-called "education". Intellectuals ought to be utterly ashamed to propagate such blinkered views. Anyone who has never heard of Keynes is culturally illiterate; that an economics student, in particular, has never heard of Keynes is a disgrace.

On another matter, the revelation that economists "ignore empirical evidence that contradicts mainstream theories" destroys any notion that economics is a science, a silly claim I have always opposed. All that it reveals is that economists have no idea what science is.

[Mar 28, 2017] Priests of neoliberal economics need to recognize that they operate in a political environment in which their work will be seized upon by financial oligarchy, and will have real influnce of justifing thier often destrcutive for the majoroity of population policies

Delong is a typical neoliberal stooge, not that different from Mankiw, or Summers
Note that the terms "neoliberalism", "neo-classical economics" and "financial oligarchy" were never used...
Notable quotes:
"... "DeLong's takeaway is that economists do need to recognize that they operate in a political environment (the sewers of Romulus) in which their work will be seized upon by interested groups, with real practical outcomes. " ..."
"... UE's conclusion is that mainstream economics needs to be taken down several notches, which would open more space for alternative approaches to economics and, indeed, alternative approaches to policy that place more weight on human outcomes, broadly understood, than the formalistic criteria of efficiency, etc. ..."
"... Simon-Wren Lewis (SWL) and Chris Dillow have both recently argued that criticising economics for the 2008 financial crisis distracts from the real source of the blame, which is banks, and therefore undermines the progressive cause. While I don't disagree that the banks deserve blame, I want to push back a bit on their argument that economics as a discipline has little to do with regressive ideas. ..."
"... Consider the case of monopoly. The economics textbooks may be against monopoly, but this is largely on the grounds that it reduces consumer welfare by increasing prices. Building on this logic, the Chicago School of anti-trust regulation has shifted the focus of anti-trust law to lowering prices for consumers. As this recent article on Amazon details, this has hidden other forms of monopoly abuse such as predatory pricing, market dominance and reduced bargaining power for workers, consumers and smaller companies. ..."
"... Or consider Reinhart and Rogoff's famous '90% debt threshold', where their statistics purportedly showed that after a country reaches 90% of sovereign debt, its growth would stall. This was used by many politicians, including George Osborne, to justify austerity - until it was revealed to be based on 'statistical errors'. Sure, R & R received a fair amount of flak for this, but they have been incredibly stubborn about the result. Where was the formal, institutional denunciation of such a glaring error from the economics profession, and of the politicians who used it to justify their regressive policies? Why are R & R still allowed to comment on the matter with even an ounce of credibility? The case for austerity undoubtedly didn't hinge on this research alone, but imagine if a politician cited faulty medical research to approve their policies - would institutions like the BMA not feel a responsibility to condemn it? (Answer: yes, even when the politician was in another country). ..."
"... There are many more examples like this, such as Andrei Shleifer, who despite being prosecuted for fraud in post-Soviet Russia was awarded the John Bates Clark medal, probably the second most prestigious prize in the discipline, was subsequently allowed to publish papers in respected journals about how well privatisation went in Russia, and was eventually bailed out of the case by his incredibly wealthy university to the tune of $26 million. This is not to mention the disastrous Russian privatisation as a whole and the role of certain economists/economic ideas in it. ..."
"... Even worse were the Chicago boys, who advised Augusto Pinochet's horrific economic policies (and no, they were not just humble advisors, they were knee deep in the absolute worst excesses of the regime.) Without any substantive ethical code and without procedures for weeding out corrupt, dishonest or discredited work, the profession creates an environment where people can act like this and get away with it, all under the banner of the intellectual credibility 'economics' seems to confer on people. ..."
"... Mainstream economists have used mathematics to hide ideology. ..."
"... They have cherry-picked mathematical constructions with highly restrictive, idealized properties and then wedged-in economic parameters to fit their purposes. That is the case with the neoclassical production function and with the Arrow-Debreu general equilibrium model. The objective was to "prove" that economies free from government control were "natural" and best. They have been sophists from their first emergence. ..."
"... Science is not capable of devising a theory that adequately explains all the human elements and serendipitous effects of an economy - and may never be capable. However, humans are capable of organizing a society according to their needs and wants. They do it on a corporate scale all the time. It isn't perfect but it works pretty well. ..."
"... Mainstream economists have fought against a managed economy because it would reduce the influence of themselves and their plutocrat sponsors. ..."
Mar 28, 2017 | economistsview.typepad.com
Peter K. -> pgl... March 27, 2017 at 07:25 AM
Peter Dorman:

"DeLong's takeaway is that economists do need to recognize that they operate in a political environment (the sewers of Romulus) in which their work will be seized upon by interested groups, with real practical outcomes. "

.... ... ...

Peter K. , March 27, 2017 at 07:20 AM
... ... ...

http://econospeak.blogspot.com/2017/03/economics-part-of-rot-part-of-treatment.html

SUNDAY, MARCH 26, 2017

Economics: Part of the Rot, Part of the Treatment, or Some of Each?

Is mainstream economics, with its false certitudes and ideological biases, one of the reasons for the dismal state of policy debate in countries like the UK and the US, or are its rigorous methods an important antidote to the ruling political foggery? That's being debated right now, live online.

Our starting point is a post on Unlearning Economics, dated March 5, which argues that the flaws of mainstream economics contribute to lousy policy on several fronts: downplaying the role of monopoly, cheerleading for the shareholder value imperative in the corporate world, knee-jerk support for trade agreements under the banner of comparative advantage, and regressive macroeconomic policy, among others. A particularly pointed paragraph brought up the Reinhart-Rogoff 90% affair and accused the economics profession of dereliction of duty by not taking action to rebuke the wrongdoers:

Where was the formal, institutional denunciation of such a glaring error from the economics profession, and of the politicians who used it to justify their regressive policies?

UE's conclusion is that mainstream economics needs to be taken down several notches, which would open more space for alternative approaches to economics and, indeed, alternative approaches to policy that place more weight on human outcomes, broadly understood, than the formalistic criteria of efficiency, etc.

Simon Wren-Lewis responded by arguing that UE has it exactly backwards. Restricting himself to UE's critique of macroeconomics, SWL says, yes, reactionary politicians have invoked "economics" to support austerity, but "real" economists for the most part have not gone along. True, there were a few, like Reinhart and Rogoff and those in the employ of the British financial sector ("City economists") who took a public stand against sensible Keynesian policies in the wake of the financial crisis, but they were a minority, and, in any case, what would you want to do about them? Economists, like professionals in any field, will disagree sometimes, and having a centralized agency to enforce a false consensus would ultimately work against progressives and dissenters, not for them. Let's put the blame where it really belongs, says SWL-on the politicians and pundits who have brushed aside decades of theoretical and empirical work to promulgate a reactionary, fact-free discourse on economic policy.

Yes-but, adds Brad DeLong. He largely agrees with SWL, but delves more deeply into the Reinhart-Rogoff affair. He shows that, even without the famed Excel glitch, a cursory look would reveal that R-R were trumpeting nonexistent results:

So the R-R claim that fiscal consolidation was necessary and urgent was unfounded from the get-go, and these two were both respected mainstream economists, so what can we infer? DeLong's takeaway is that economists do need to recognize that they operate in a political environment (the sewers of Romulus) in which their work will be seized upon by interested groups, with real practical outcomes. In this situation, the profession as a whole has a responsibility to assess high profile but dubious work. Although he isn't explicit, my reading is that DeLong wants some sort of professional quality control, but not institutionalized in the way UE seems to call for.

...

pgl -> Peter K.... , March 27, 2017 at 07:44 AM
Yep - try reading this portion:

"reactionary politicians have invoked "economics" to support austerity, but "real" economists for the most part have not gone along. True, there were a few, like Reinhart and Rogoff and those in the employ of the British financial sector ("City economists") who took a public stand against sensible Keynesian policies in the wake of the financial crisis, but they were a minority, and, in any case, what would you want to do about them? Economists, like professionals in any field, will disagree sometimes, and having a centralized agency to enforce a false consensus would ultimately work against progressives and dissenters, not for them. Let's put the blame where it really belongs, says SWL-on the politicians and pundits who have brushed aside decades of theoretical and empirical work to promulgate a reactionary, fact-free discourse on economic policy."

Peter K. , March 27, 2017 at 07:27 AM
https://medium.com/@UnlearningEcon/no-criticising-economics-is-not-regressive-43e114777429#.gihe5thlj

Unlearning EconomicsFollow
Mar 5

No, Criticising Economics is not Regressive

Simon-Wren Lewis (SWL) and Chris Dillow have both recently argued that criticising economics for the 2008 financial crisis distracts from the real source of the blame, which is banks, and therefore undermines the progressive cause. While I don't disagree that the banks deserve blame, I want to push back a bit on their argument that economics as a discipline has little to do with regressive ideas.

But firstly, it is my view that criticising economics needn't have an ideological motivation. Many critics, myself included, simply believe that neoclassical economics has severe shortcomings and that in order to understand the economic system properly we need better ideas. In many cases criticisms of neoclassical economics are so abstract that it's not even clear to me what the political implications of either side would be (e.g. the fact that Arrow-Debreu equilibrium might be unstable has no bearing on my view of whether capitalism itself is). I respect both SWL and Dillow immensely, but taken alone I consider this line of argument a rather feeble attempt to shut down an important scientific and philosophical debate.

Despite this, the point has some force to it: why devote so much intellectual effort to criticising economics when we could be devoting it to getting the big banks and other corporate wrongdoers? And here I think SWL and Dillow both paper over the extent to which economics has served those in power, as I will try to illustrate with a number of examples. To be clear, I'm not 'blaming' economists for all of these occurrences, but I do think the discipline seems to eschew responsibility for them, and that progressive economists have a blind spot when it comes to the practical consequences of their discipline.

Economics in Practice

I've always acknowledged that economists themselves are probably more progressive than they're usually given credit for. Nevertheless, the absence of things like power, exploitation, poverty, inequality, conflict, and disaster in most mainstream models - centred as they are around a norm of well-functioning markets, and focused on banal criteria like prices, output and efficiency - tends to anodise the subject matter. In practice, this vision of the economy detracts attention from important social issues and can even serve to conceal outright abuses. The result is that in practice, the influence of economics has often been more regressive than progressive.

Consider the case of monopoly. The economics textbooks may be against monopoly, but this is largely on the grounds that it reduces consumer welfare by increasing prices. Building on this logic, the Chicago School of anti-trust regulation has shifted the focus of anti-trust law to lowering prices for consumers. As this recent article on Amazon details, this has hidden other forms of monopoly abuse such as predatory pricing, market dominance and reduced bargaining power for workers, consumers and smaller companies.

Similarly, textbook ideas about profit maximisation and rational agents responding to incentives featured prominently in the promotion of shareholder value by Milton Friedman and other economists, which has been dominant over the past few decades and has been instrumental in increasing inequality and corporate short-termism. The potential macroeconomic impacts of corporate concentration have also been ignored by discipline until very recently - a consequence, perhaps, of the narrowing of particular subfields and the neglection of more critical systemic analysis (something similar could perhaps be said for the 2016 Prize in contract theory, though I am no expert in this area).

One type of institution which is dominated by economic ideas is central banks, yet many of their policies have had regressive elements. For instance, SWL praises economists at the Bank of England for implementing Quantitative Easing, but forgets that the Bank itself admitted that this has disproportionately benefited the wealthy. This problem goes even deeper: as J W Mason has argued, inflation targeting - a key central bank policy across the world - in practice results in workers' wages being kept down and their jobs being made more insecure in the name of combating inflation. In both cases what is painted as a relatively benign process - reducing interest rates and managing inflation, respectively - actually has quite serious social consequences, which generally aren't discussed in class or by policymakers.

In the realm of international trade, economists have been all too inclined to support trade deals - often quite vociferously - on the basis of simple ideas like comparative advantage, while ignoring (a) the actual details of the trade deals, which as Dean Baker frequently points out, tend to favour the rich and corporations and (b) their own more complex economic models, which as Dani Rodrik frequently points out, do imply that trade will harm some people while benefitting others. Uneven and unfair international trade has been a key element of the harm to workers over the past few decades, and was undoubtedly a factor in the election of Trump.

Global trade institutions like the IMF and World Bank have been dominated by economics since their inception, and using economics they inflicted massive pain through their free market 'structural adjustment' policies, which can only be described as regressive but which were fundamentally based on context-free neoclassical ideas about markets. True, these institutions may have softened somewhat in recent years, but that doesn't undo the harm they have caused. In fact, even their more recent 'bottom up' policies such as microcredit and Randomised Control Trials - both inspired by economic ideas - often seem to have benefited global and local elites at the expensive of the poorest. As Jamie Galbraith once noted in the context of the financial crisis, the discipline just has a blind spot for how ideas interact with power to produce unfair outcomes, sometimes taking the form of outright abuse and fraud. Which leads me nicely to my next argument.

Abusing Economics

Economists may complain that economic ideas have been misused by vested interests, and that this isn't their responsibility. But a huge problem with the discipline of economics is that it has virtually no institutional shields against mistakes and wrongdoing. Merton and Scholes won the biggest prize in the profession for their model of financial markets - which had become commonly adopted in options trading - in 1997. A year later those same economists required a hefty bailout when the use of their model was implicated in the collapse of the hedge fund Long-Term Capital Management, where they were both partners. Was the prize revoked? No. Were they discredited? No. Actually, even the model is still widely used, despite massively underestimating fat tails and therefore being implicated in a number of other financial crises, including 2008.

Or consider Reinhart and Rogoff's famous '90% debt threshold', where their statistics purportedly showed that after a country reaches 90% of sovereign debt, its growth would stall. This was used by many politicians, including George Osborne, to justify austerity - until it was revealed to be based on 'statistical errors'. Sure, R & R received a fair amount of flak for this, but they have been incredibly stubborn about the result. Where was the formal, institutional denunciation of such a glaring error from the economics profession, and of the politicians who used it to justify their regressive policies? Why are R & R still allowed to comment on the matter with even an ounce of credibility? The case for austerity undoubtedly didn't hinge on this research alone, but imagine if a politician cited faulty medical research to approve their policies - would institutions like the BMA not feel a responsibility to condemn it? (Answer: yes, even when the politician was in another country).

There are many more examples like this, such as Andrei Shleifer, who despite being prosecuted for fraud in post-Soviet Russia was awarded the John Bates Clark medal, probably the second most prestigious prize in the discipline, was subsequently allowed to publish papers in respected journals about how well privatisation went in Russia, and was eventually bailed out of the case by his incredibly wealthy university to the tune of $26 million. This is not to mention the disastrous Russian privatisation as a whole and the role of certain economists/economic ideas in it.

Even worse were the Chicago boys, who advised Augusto Pinochet's horrific economic policies (and no, they were not just humble advisors, they were knee deep in the absolute worst excesses of the regime.) Without any substantive ethical code and without procedures for weeding out corrupt, dishonest or discredited work, the profession creates an environment where people can act like this and get away with it, all under the banner of the intellectual credibility 'economics' seems to confer on people.

And this leads me to my last point, which is the rhetorical power that invoking 'economics' has in contemporary politics. 'You don't understand economics' is - rightly or wrongly - a common refrain of those attacking progressive policies such as Ed Miliband's proposed energy price freeze, the minimum wage, or fiscal expansion. As with the above abuses of economics, those such as SWL complain (perhaps correctly) that these are inaccurate representations of the field.

But these same economists then invoke 'economics' in a similar way to justify their own policies. In my opinion, this only reinforces the dominance of economics and narrows the debate, a process which is inherently regressive. The case against austerity does not depend on whether it is 'good economics', but on its human impact. Nor does the case for combating climate change depend on the present discounted value of future costs to GDP. Reclaiming political debate from the grip of economics will make the human side of politics more central, and so can only serve a progressive purpose.

Peter K. -> Peter K.... , March 27, 2017 at 07:29 AM
Think about how Republicans use "Science" and scientists fight back against their misuse. In recent decades Republicans have left the field and now "scientist" has become a bad word for them.

Same thing needs to happen with Economics.

RGC -> Peter K.... , March 27, 2017 at 09:25 AM
Mainstream economists have used mathematics to hide ideology.

They have cherry-picked mathematical constructions with highly restrictive, idealized properties and then wedged-in economic parameters to fit their purposes. That is the case with the neoclassical production function and with the Arrow-Debreu general equilibrium model. The objective was to "prove" that economies free from government control were "natural" and best. They have been sophists from their first emergence.

RGC -> RGC... , March 27, 2017 at 09:33 AM
Consider the Arrow-Debreu model:

In the 1950s, Arrow and others proved a theorem that, many economists believe, put a rigorous mathematical foundation beneath Adam Smith's idea of the invisible hand. The theorem shows -- in a highly abstract model -- that producers and consumers can match their desires perfectly, given a particular set of prices.

In this rarified atmosphere of "general equilibrium," economic activity might take place efficiently without any central coordination, simply as a result of people pursuing their self-interest.

It's an insight that economists have used to argue for de-unionization, globalization and financial deregulation, all in the name of removing various frictions or distortions that prevent markets from achieving the elusive equilibrium.

Yet the theorem trails a dense cloud of caveats, which Arrow himself recognized could be more important than the proof itself. For one, it worked only in a perfect world, far removed from the one humans actually inhabit.

Equilibrium is merely one of many conceivable states of that world; there's no particular reason to believe that the economy would naturally tend toward it. Beautiful as the math may be, actual experience suggests that its magical efficiency is purely theoretical, and a poor guide to reality.

Remarkably, academic macroeconomists have largely ignored these limitations, and continue to teach the general equilibrium model -- and more modern variants with same fatal weaknesses -- as a decent approximation of reality.

Economists routinely use the framework to form their views on everything from taxation to global trade -- portraying it as a value-free, scientific approach, when in fact it carries a hidden ideology that casts completely free markets as the ideal.

Thus, when markets break down, the solution inevitably entails removing barriers to their proper functioning: privatize healthcare, education or social security, keep working to free up trade, or make labor markets more "flexible."

Those prescriptions have all too often failed, as the 2008 financial crisis eloquently demonstrated. The result is widespread distrust of economic experts and rejection of globalization.

In his recent book "Economism: Bad Economics and the Rise of Inequality," James Kwak credits conservative think tanks funded by corporations and the wealthy for spreading the oversimplified belief in markets as wise machines for producing optimal social outcomes. He certainly has a point, yet such propaganda stemmed from an intellectual model that had been lurking at the center of economics all along -- and remains there now, still widely revered.

This perversion isn't Arrow's fault. He merely helped to prove a mathematical theorem, and was no blind advocate for markets. Indeed, he actually thought the theorem illustrated the limitations of capitalism, and he was prescient in understanding how economic inequality might come to impair the workings of democratic government.

Perhaps it would be best to use his own words: "In a system where virtually all resources are available for a price, economic power can be translated into political power by channels too obvious for mention. In a capitalist society, economic power is very unequally distributed, and hence democratic government is inevitably something of a sham."

https://www.bloomberg.com/view/articles/2017-03-09/the-misunderstanding-at-the-core-of-economics

RGC -> RGC... , March 27, 2017 at 09:47 AM
Note that neo-classical(mainstream) economists did NOT do what scientists do.

They did not observe phenomena and then try to construct a theory to explain the phenomena.

Rather, they constructed a theory that supported their ideology and then tried to argue that the theory was representative of the real world.

anne -> RGC... , March 27, 2017 at 02:55 PM
I do appreciate this essay.
Egmont Kakarot-Handtke , March 27, 2017 at 07:50 AM
The non-existence of economics

Comment on Simon Wren-Lewis on 'On criticizing the existence of mainstream economics'

There is no such thing as economics, there are FOUR economixes and they are constantly played against each other. First, there is theoretical and political economics. The crucial distinction within theoretical economics is true/false, the crucial distinction within political economics good/bad. Economics exhausts itself since 200+ years in crossover discussion, that is, by NOT keeping science and politics properly apart. As a result, it got neither science nor politics right.

Heterodox economists say that orthodox economics is false and in this very general sense they are right. Heterodox economists have debunked much of Orthodoxy but this has not enabled them to work out a superior alternative. The proper task of Heterodoxy is not the repetitive critique of Orthodoxy but to fully replace it, that is, to perform a paradigm shift: "The problem is not just to say that something might be wrong, but to replace it by something ― and that is not so easy." (Feynman)

Because Heterodoxy has never developed a valid alternative it advocates pluralism, more precisely, the pluralism of false theories. The argument boils down to: if Orthodoxy is allowed to sell their rubbish in the curriculum, Heterodoxy must also be allowed to sell their rubbish. Economics is not so much a heroic struggle about scientific truth but about a better place at the academic trough.

The fact of the matter is that neither Orthodoxy nor Heterodoxy has the true theory and that, by consequence, the political arguments of BOTH sides have NO sound scientific foundation.

Traditional Heterodoxy knows quite well that it has nothing to offer in the way of progressive science and therefore argues for dumping scientific standards altogether and to focus on politics pure and simple: "The case against austerity does not depend on whether it is 'good economics', but on its human impact. Nor does the case for combating climate change depend on the present discounted value of future costs to GDP. Reclaiming political debate from the grip of economics will make the human side of politics more central, and so can only serve a progressive purpose."

This is a good idea, economists should no longer pretend to do science but openly push their respective political agendas, after all, this is what they have actually done the past 200+ years. Neither Orthodoxy nor traditional Heterodoxy satisfies the scientific criteria of material and formal consistency. So, both, orthodox and heterodox economists have to get out of science because of incurable incompetence.

It was John Stuart Mill who told economists that they must decide themselves between science and politics: "A scientific observer or reasoner, merely as such, is not an adviser for practice. His part is only to show that certain consequences follow from certain causes, and that to obtain certain ends, certain means are the most effectual. Whether the ends themselves are such as ought to be pursued, and if so, in what cases and to how great a length, it is no part of his business as a cultivator of science to decide, and science alone will never qualify him for the decision."

Both, orthodox and heterodox economists violate the principle of the separation of science and politics on a daily basis. Economics is what Feynman famously called cargo cult science and neither right wing nor left wing economic policy guidance has a sound scientific foundation since Adam Smith/Karl Marx. It is high time that economics frees itself from the corrupting grip of politics.

Egmont Kakarot-Handtke

RGC -> Egmont Kakarot-Handtke ... , March 27, 2017 at 11:33 AM
Science is not capable of devising a theory that adequately explains all the human elements and serendipitous effects of an economy - and may never be capable. However, humans are capable of organizing a society according to their needs and wants. They do it on a corporate scale all the time. It isn't perfect but it works pretty well.

Mainstream economists have fought against a managed economy because it would reduce the influence of themselves and their plutocrat sponsors.

Peter K. , March 27, 2017 at 08:22 AM
I like that Thoma is linking to Campbell who has some interesting blog posts, like in today's links:

http://douglaslcampbell.blogspot.com/2017/03/corporations-in-age-of-inequality.html

"The story of inequality they tell is also one which is essentially technology based (IT and outsourcing), as they find that inequality is almost entirely driven by changes in between firm inequality. They deserve credit for presenting an interesting set of facts.

However, while intriguing, I'm not yet totally convinced this is the key to understanding inequality. Macromon [sic] also had an excellent discussion of this research awhile back...

...

I took issue with this comment "Since 1980, income inequality has risen sharply in most developed economies". As my blog readers know, income inequality has not risen dramatically in Germany, France, Japan, or Sweden according to Alvaredo et al.. Thus, this comment threw me: "This means that the rising gap in pay between firms accounts for the large majority of the increase in income inequality in the United States. It also accounts for at least a substantial part in other countries, as research conducted in the UK, Germany, and Sweden demonstrates." Right, but the increases in inequality in Germany and Sweden have been quite minor relative to the US, and are also associated with changes in top marginal tax rates. So, between firm inequality isn't actually explaining much is what I'm hearing.

..."

Peter K. , March 27, 2017 at 08:22 AM
pgl -> Peter K....
Try this single line:

"the profession as a whole has a responsibility to assess high profile but dubious work."

As in that awful paper by Gerald Friedman. Peter Dorman ripped it. I ripped. And yes the Romers ripped it.

That is what economists are suppose to do. But you have whined about this for the last 14 months.

Reply Monday, March 27, 2017 at 07:47 AM

Yes it was a priority to demonize Friedman b/c he was coming from the left and was supposedly supporting Bernie Sanders. It was a way for the center-left to discredit Bernie Sanders and call him "unPresidential" and "unserious" as Hillary did.

Meawhile PGL continuously name-drops Mankiw as if he has a man crush on him.

[Mar 28, 2017] The neoliberals also have strong views on the kind of society they would like to create, but they prefer to hide it because very few people would vote for it

Notable quotes:
"... You don't need to look very far to see the neoliberal ideal; it is all around us: everything a commodity, including human beings; massive differentials in life chances; sweat shops for producers juxtaposed with unimaginable wealth for the owners of capital; everybody on their own, the rolling back of collective provision and no such thing as society. ..."
"... Instead, the neoliberals talk of freedom and choice, but in reality it is freedom for the few to exploit the many and the choice to take whatever crumbs are offered to you or starve. ..."
"... Agree, but it's not that they don't talk about it. The use mathematics as a way to underscore what is essentially an ideological position. It gives them an aura of objectivity, impartiality and scientific truth which, given their prepositions about utility maximization and unbounded growth, they frankly don't have. ..."
Mar 28, 2017 | discussion.theguardian.com
archeeros , 25 Oct 2013 3:50

Keynes viewed economics as a branch of philosophy. At its heart are two questions - What is the nature of man? and What sort of society should we create? The focus on mathematical models, based upon free-market theories, has long been a victory for ivory towers over reality. Sure, they have an important role to play, but when they are at the centre of what is taught at universities something has gone wrong.

SteveTen -> archeeros , 25 Oct 2013 5:57

The neoliberals also have strong views on the kind of society they would like to create, but they don't talk about it often, because very few people would vote for it.

You don't need to look very far to see the neoliberal ideal; it is all around us: everything a commodity, including human beings; massive differentials in life chances; sweat shops for producers juxtaposed with unimaginable wealth for the owners of capital; everybody on their own, the rolling back of collective provision and no such thing as society.

Instead, the neoliberals talk of freedom and choice, but in reality it is freedom for the few to exploit the many and the choice to take whatever crumbs are offered to you or starve.

Usignolo -> SteveTen , 25 Oct 2013 6:18

Agree, but it's not that they don't talk about it. The use mathematics as a way to underscore what is essentially an ideological position. It gives them an aura of objectivity, impartiality and scientific truth which, given their prepositions about utility maximization and unbounded growth, they frankly don't have.

[Mar 28, 2017] Mainstream economics, with its false certitudes and ideological biases, is one of the reasons for the dismal state of policy debate in countries like the UK and the US, sustaining the ruling neoliberals political foggery?

Notable quotes:
"... Few mainstream economists predicted the global financial crash of 2008 and academics have been accused of acting as cheerleaders for the often labyrinthine financial models behind the crisis. Now a growing band of university students are plotting a quiet revolution against orthodox free-market teaching, arguing that alternative ways of thinking have been pushed to the margins. ..."
"... Our starting point is a post on Unlearning Economics, dated March 5, which argues that the flaws of mainstream economics contribute to lousy policy on several fronts: downplaying the role of monopoly, cheerleading for the shareholder value imperative in the corporate world, knee-jerk support for trade agreements under the banner of comparative advantage, and regressive macroeconomic policy, among others. A particularly pointed paragraph brought up the Reinhart-Rogoff 90% affair and accused the economics profession of dereliction of duty by not taking action to rebuke the wrongdoers: ..."
"... Simon Wren-Lewis responded by arguing that UE has it exactly backwards. Restricting himself to UE's critique of macroeconomics, SWL says, yes, reactionary politicians have invoked "economics" to support austerity, but "real" economists for the most part have not gone along. True, there were a few, like Reinhart and Rogoff and those in the employ of the British financial sector ("City economists") who took a public stand against sensible Keynesian policies in the wake of the financial crisis, but they were a minority, and, in any case, what would you want to do about them? Economists, like professionals in any field, will disagree sometimes, and having a centralized agency to enforce a false consensus would ultimately work against progressives and dissenters, not for them. Let's put the blame where it really belongs, says SWL-on the politicians and pundits who have brushed aside decades of theoretical and empirical work to promulgate a reactionary, fact-free discourse on economic policy. ..."
Mar 28, 2017 | economistsview.typepad.com
JohnH -> Peter K.... March 27, 2017 at 06:51 PM

So true; "SWL has never addressed what is happening in the real world."

And that's the reason UK economics students revolted: "Few mainstream economists predicted the global financial crash of 2008 and academics have been accused of acting as cheerleaders for the often labyrinthine financial models behind the crisis. Now a growing band of university students are plotting a quiet revolution against orthodox free-market teaching, arguing that alternative ways of thinking have been pushed to the margins.

Economics undergraduates at the University of Manchester have formed the Post-Crash Economics Society, which they hope will be copied by universities across the country. The organisers criticise university courses for doing little to explain why economists failed to warn about the global financial crisis and for having too heavy a focus on training students for City jobs."
https://www.theguardian.com/business/2013/oct/24/students-post-crash-economics

pgl is a classic example. He regularly preaches what theory says but is clueless to explain what's really happening.

Peter K. , March 27, 2017 at 07:20 AM
I like Peter Dorman much, much better than PGL. He always has interesting things to say. Here he stays on topic, unlike PGL.

http://econospeak.blogspot.com/2017/03/economics-part-of-rot-part-of-treatment.html

SUNDAY, MARCH 26, 2017

Economics: Part of the Rot, Part of the Treatment, or Some of Each?

Is mainstream economics, with its false certitudes and ideological biases, one of the reasons for the dismal state of policy debate in countries like the UK and the US, or are its rigorous methods an important antidote to the ruling political foggery? That's being debated right now, live online.

Our starting point is a post on Unlearning Economics, dated March 5, which argues that the flaws of mainstream economics contribute to lousy policy on several fronts: downplaying the role of monopoly, cheerleading for the shareholder value imperative in the corporate world, knee-jerk support for trade agreements under the banner of comparative advantage, and regressive macroeconomic policy, among others. A particularly pointed paragraph brought up the Reinhart-Rogoff 90% affair and accused the economics profession of dereliction of duty by not taking action to rebuke the wrongdoers:

Where was the formal, institutional denunciation of such a glaring error from the economics profession, and of the politicians who used it to justify their regressive policies?

UE's conclusion is that mainstream economics needs to be taken down several notches, which would open more space for alternative approaches to economics and, indeed, alternative approaches to policy that place more weight on human outcomes, broadly understood, than the formalistic criteria of efficiency, etc.

Simon Wren-Lewis responded by arguing that UE has it exactly backwards. Restricting himself to UE's critique of macroeconomics, SWL says, yes, reactionary politicians have invoked "economics" to support austerity, but "real" economists for the most part have not gone along. True, there were a few, like Reinhart and Rogoff and those in the employ of the British financial sector ("City economists") who took a public stand against sensible Keynesian policies in the wake of the financial crisis, but they were a minority, and, in any case, what would you want to do about them? Economists, like professionals in any field, will disagree sometimes, and having a centralized agency to enforce a false consensus would ultimately work against progressives and dissenters, not for them. Let's put the blame where it really belongs, says SWL-on the politicians and pundits who have brushed aside decades of theoretical and empirical work to promulgate a reactionary, fact-free discourse on economic policy.

Yes-but, adds Brad DeLong. He largely agrees with SWL, but delves more deeply into the Reinhart-Rogoff affair. He shows that, even without the famed Excel glitch, a cursory look would reveal that R-R were trumpeting nonexistent results:

So the R-R claim that fiscal consolidation was necessary and urgent was unfounded from the get-go, and these two were both respected mainstream economists, so what can we infer? DeLong's takeaway is that economists do need to recognize that they operate in a political environment (the sewers of Romulus) in which their work will be seized upon by interested groups, with real practical outcomes. In this situation, the profession as a whole has a responsibility to assess high profile but dubious work. Although he isn't explicit, my reading is that DeLong wants some sort of professional quality control, but not institutionalized in the way UE seems to call for.

...

[Mar 28, 2017] Economics students aim to tear up free-market syllabus

Notable quotes:
"... It was an eye opener that Universities are teaching only the neo-liberal model as the core syllabus. This is not education but indoctrination. Fair play to the group then who were passionate about the need for change and realise that it is up to them to effect that change. Good luck to them, I hope that they are successful in re-claiming education as a means of furthering understanding through questioning prevailing orthodoxy. ..."
"... Good luck. You may need it. You will be surprised at how much opposition you encounter and how remorseless and relentless it is. Look up the book "Political economy now!", about the experience at the University of Sydney. ..."
"... Economics is so discredited a subject that even students who have barley started studying realise that - with a few exceptions like Stiglitz or Schiller - it is total fabricated bullshit paid for by people with enough money to benefit from the lies it spreads. ..."
"... One of the biggest lies ever told the free market, as its never ever been a reality. ..."
"... Economists, like scientists and the rest of us, are always employed by someone and therein lies the problem: the conflict between what we believe to be the truth and what we are paid to do (or teach) to keep our job. Many economists (like investors & politicians) knew the crash would burst at some point but only those who enjoyed a seat outside the system would benefit from its prediction. ..."
Oct 24, 2013 | www.theguardian.com
Few mainstream economists predicted the global financial crash of 2008 and academics have been accused of acting as cheerleaders for the often labyrinthine financial models behind the crisis. Now a growing band of university students are plotting a quiet revolution against orthodox free-market teaching, arguing that alternative ways of thinking have been pushed to the margins.

Economics undergraduates at the University of Manchester have formed the Post-Crash Economics Society , which they hope will be copied by universities across the country. The organisers criticise university courses for doing little to explain why economists failed to warn about the global financial crisis and for having too heavy a focus on training students for City jobs.

A growing number of top economists, such as Ha-Joon Chang, who teaches economics at Cambridge University, are backing the students.

Next month the society plans to publish a manifesto proposing sweeping reforms to the University of Manchester's curriculum, with the hope that other institutions will follow suit.

Joe Earle, a spokesman for the Post-Crash Economics Society and a final-year undergraduate, said academic departments were "ignoring the crisis" and that, by neglecting global developments and critics of the free market such as Keynes and Marx, the study of economics was "in danger of losing its broader relevance".

Chang, who is a reader in the political economy of development at Cambridge, said he agreed with the society's premise. The teaching of economics was increasingly confined to arcane mathematical models, he said. "Students are not even prepared for the commercial world. Few [students] know what is going on in China and how it influences the global economic situation. Even worse, I've met American students who have never heard of Keynes."

In June a network of young economics students, thinkers and writers set up Rethinking Economics , a campaign group to challenge what they say is the predominant narrative in the subject.

Earle said students across Britain were being taught neoclassical economics "as if it was the only theory".

He said: "It is given such a dominant position in our modules that many students aren't even aware that there are other distinct theories out there that question the assumptions, methodologies and conclusions of the economics we are taught."

Multiple-choice and maths questions dominate the first two years of economics degrees, which Earle said meant most students stayed away from modules that required reading and essay-writing, such as history of economic thought. "They think they just don't have the skills required for those sorts of modules and they don't want to jeopardise their degree," he said. "As a consequence, economics students never develop the faculties necessary to critically question, evaluate and compare economic theories, and enter the working world with a false belief about what economics is and a knowledge base limited to neoclassical theory."

In the decade before the 2008 crash, many economists dismissed warnings that property and stock markets were overvalued. They argued that markets were correctly pricing shares, property and exotic derivatives in line with economic models of behaviour. It was only when the US sub-prime mortgage market unravelled that banks realised a collective failure to spot the bubble had wrecked their finances.

In his 2010 documentary Inside Job, Charles Ferguson highlighted how US academics had produced hundreds of reports in support of the types of high-risk trading and debt-fuelled consumption that triggered the crash.

Some leading economists have criticised university economics teaching, among them Paul Krugman, a Nobel prize winner and professor at Princeton university who has attacked the complacency of economics education in the US.

In an article for the New York Times in 2009, Krugman wrote : "As I see it, the economics profession went astray because economists, as a group, mistook beauty, clad in impressive-looking mathematics, for truth."

Adam Posen, head of the Washington-based thinktank the Peterson Institute, said universities ignore empirical evidence that contradicts mainstream theories in favour of "overly technical nonsense".

City economists attacked Joseph Stiglitz, the former World Bank chief economist, and Olivier Blanchard, the current International Monetary Fund chief economist, when they criticised western governments for cutting investment in the wake of the crash.

A Manchester University spokeman said that, as at other university courses around the world, economics teaching at Manchester "focuses on mainstream approaches, reflecting the current state of the discipline". He added: "It is also important for students' career prospects that they have an effective grounding in the core elements of the subject.

"Many students at Manchester study economics in an interdisciplinary context alongside other social sciences, especially philosophy, politics and sociology. Such students gain knowledge of different kinds of approaches to examining social phenomena many modules taught by the department centre on the use of quantitative techniques. These could just as easily be deployed in mainstream or non-mainstream contexts." Since you're here

we've got a small favour to ask. More people are reading the Guardian than ever, but far fewer are paying for it. Advertising revenues across the media are falling fast. And unlike many news organisations, we haven't put up a paywall – we want to keep our journalism as open as we can . So you can see why we need to ask for your help. The Guardian's independent, investigative journalism takes a lot of time, money and hard work to produce. But we do it because we believe our perspective matters – because it might well be your perspective, too.

If everyone who reads our reporting, who likes it, helps to support it, our future would be much more secure.

SmashtheGates , 25 Oct 2013 00:07

Good luck to this group. They are on the right lines.

Post-Autistic Economics has been around for quite a while, now, and has developed into the World Economics Association. Take a look ...........

http://www.worldeconomicsassociation.org/ Reply Share

GreatGrandDad SmashtheGates , 25 Oct 2013 04:02
Good luck to this group. They are on the right lines.
Post-Autistic Economics has been around for quite a while....

and so has CASSE.

I hope these students can insist on For the Common Good (Daly and Cobb 1992) becoming a central text for their course.

The quotations from the 'grand-daddy' of Heterodox (as opposed to Orthodox) Economics, Kenneth Goulding,
will give them plenty of ammunition.

I particularly like: Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist. and
Economists are like computers. They need to have facts punched into them.

But my favourite is Mathematics brought rigor to Economics. Unfortunately, it also brought mortis.

littlepump SmashtheGates , 25 Oct 2013 09:42
@ SmashtheGates 25 October 2013 12:07am . Get cifFix for Firefox .

Good luck to this group. They are on the right lines.

Agreed, but they are fighting an uphill battle. Just look at how few (accademic) heterodox economists actually work in economics departments. I think almost every heterdox economist I know works in an non-economics school/faculty (i.e. schools/facultues of the environment, sustainability, sociology, land use etc).
GreatGrandDad Conrad33 , 25 Oct 2013 04:33
Again the Economists have their heads buried in stats rather than in the trenches.

Nice one, and a neat summary of what the economists had to tell the Queen in answer to her question as to why there was not forewarning of the crash.

Chrisk79 , 25 Oct 2013 00:36
I spoke with some of the Post Crash group at a Peoples Assembly meeting recently. It was an eye opener that Universities are teaching only the neo-liberal model as the core syllabus. This is not education but indoctrination. Fair play to the group then who were passionate about the need for change and realise that it is up to them to effect that change. Good luck to them, I hope that they are successful in re-claiming education as a means of furthering understanding through questioning prevailing orthodoxy.
hamstrung Chrisk79 , 25 Oct 2013 01:53
Well said that man. Very well said. Unquestioning indoctrination has led us (all countries in the world be they active participants or 'victims) to this sorry pass.

Basic economics should include the very basic idea that money is no more and no less than a tool. If you strip money / the tool away from folk then they will either try and take your tool from you or, if life becomes savage enough, they will fall by the wayside.

Does this generation and successive ones really want to walk over the bodies of others?

Without a profound readjustment and realignment of economic thinking, that is precisely what is in store. Indeed, it is what has been set in motion already. Time for an urgent re-think before more bodies litter the highways.

GreatGrandDad hamstrung , 25 Oct 2013 04:40
Time for an urgent re-think...

I heard recently about one man who had had such a re-think.

He was an American financial executive who was asked why he was taking early retirement and going off to live in a little valley in the hills.

He replied: "Well, it is a lovely property with great scenery, fertile land and its own microhydroelectricity-----but the really big attraction is that it puts 300 miles of armed hillbillies between me and the nearest city"!!.

callaspodeaspode GreatGrandDad , 25 Oct 2013 11:28
I do hope the chap in question doesn't end up regretting that he has deliberately placed himself into a situation where there are 300 miles of armed hillbillies between himself and the nearest city.

These things can cut both ways. Reply Share

GazInOz , 25 Oct 2013 02:27
Good luck. You may need it. You will be surprised at how much opposition you encounter and how remorseless and relentless it is. Look up the book "Political economy now!", about the experience at the University of Sydney.

http://purl.library.usyd.edu.au/sup/9781921364051

marukun GazInOz , 25 Oct 2013 05:22
Exactly - the clue is in this statement from the University authorities...

It is also important for students' career prospects that they have an effective grounding in the core elements of the subject.

Or in other words...

Students should be familar with the free market fair tales thrown up by rich, greedy bankers and the right wing in order to earn money pandering the "correct" line

Economics is so discredited a subject that even students who have barley started studying realise that - with a few exceptions like Stiglitz or Schiller - it is total fabricated bullshit paid for by people with enough money to benefit from the lies it spreads.

Paul Flanagan , 25 Oct 2013 02:34
One of the biggest lies ever told the free market, as its never ever been a reality.

Restrictions or prejudices ensure this, so such a philosophy deserves tearing up just like their supporters who believe community and care are bad ideals. They call it socialism but it is far from being a dirty word as it is about looking after all people on a more equal level, so as to ensure the most vulnerable people in society are not left in a helpless and hopeless position.

GreatGrandDad hamstrung , 25 Oct 2013 04:40
Time for an urgent re-think...

I heard recently about one man who had had such a re-think.
He was an American financial executive who was asked why he was taking early retirement and going off to live in a little valley in the hills.
He replied: "Well, it is a lovely property with great scenery, fertile land and its own microhydroelectricity-----but the really big attraction is that it puts 300 miles of armed hillbillies between me and the nearest city"!!.

Squiff811 , 25 Oct 2013 07:28
Thatcherist 'Reaganomics' was their response to the hissy fit Maggie threw at the 'grubby little terrorist' Nelson Mandela when he started to put the kibosh on the elites cash cow of South African apartheid, 4 decades of 'starving the beast' and media complicity in pushing the benefits of supply side while pruning demand to the core by cutting back public investment which is the only source of high velocity currency in a debt based economy where cash is simply printed to commission public gods, services and infrastructure for a civilised society and withdrawn through tax to mitigate inflation.

Only as we approach their ideology of fiscal apartheid do the courtiers perceive that without demand a bleak future awaits everyone but the very few already excessively wealthy.

Nicoise , 25 Oct 2013 07:41
Economists, like scientists and the rest of us, are always employed by someone and therein lies the problem: the conflict between what we believe to be the truth and what we are paid to do (or teach) to keep our job. Many economists (like investors & politicians) knew the crash would burst at some point but only those who enjoyed a seat outside the system would benefit from its prediction.

[Mar 28, 2017] Outragious speaker fees at US universities events are a sign of corruption

Notable quotes:
"... $32K to hear Snooki speak at the Rutgers commencement? Are the administrators nuts? ..."
"... the Post and the legislator have certain attitudes, ideological biases if you will, towards public universities in general, and college students and the terms of their crushing college debt. ..."
"... And there was some thought that some elements in the legislature were perturbed that Rutgers did invite author Toni Morrison to speak at commencement, and did pay her $30,000 for it. And God knows what they payed Mr. Obama. ..."
"... Thank God they did not invite Hillary. ..."
"... For my son's Rutgers graduating class of 2014, the University had engaged Miss Condoleezza Rice, of Bush Administration State Department fame, to speak at that their commencement. For a $35,000 by the way. ..."
"... The professional class tends to defend the prerogatives of their own, sticking to their 'no consequences' principle for themselves and the acts of their peers, including the financiers. ..."
"... In the case of Secretary Rice, the students and faculty thought that it was hypocrisy to award an honorary law degree to someone who had consciously worked to circumvent the law, encouraged an aggressive war on contrived evidence, and helped permit the use of torture in violation of our nation's long standing principles. ..."
"... Rice signed off to give the CIA authority to conduct their torture tactics for gathering information from detainees as well. These are clearly human rights issues. By inviting her to speak and awarding her an honorary degree, we are encouraging and perpetuating a world that justifies torture and debases humanity ..."
"... I found it highly hypocritical of the Republican legislator and the arch-conservative Post to phrase their own stand against high commencement fees in such an incorrect manner, and dare I say false news . The Post and the politician knew better. They just did not give a damn in making their point. ..."
Mar 28, 2017 | jessescrossroadscafe.blogspot.com
From Jeri-Lynn Scofield over at Naked Capitalism who picked up this piece in the NY post:
Snooki inspires legislation to limit state university speaker fees NY Post. Moi: Speaking as a born and bred Jersey girl, I applaud the state legislature's action. Nice to see the state of my birth lead the way in something other than corruption or toxic waste. And about time– $32K to hear Snooki speak at the Rutgers commencement? Are the administrators nuts? And the proposed $10k cap is too high. Why should any speaker receive more than expenses and a modest honorarium, e.g., $1K– which incidentally, anyone with any class would immediately donate back to the university.
I don't normally read the Post, except perhaps for financial pieces by John Crudele, so I was glad to see this at a site where I do read on occasion.

This is no knock on Jeri-Lynn whose major point remains intact, that commencement fees may be far too generous.

And as an old fogey, it seems to me to be a correct sentiment about paying far too much money and attention to these reality tv stars, our current President notwithstanding.

Except that this even with Snooki never happened, at least not in the way that the NY Post and the state legislator Republican Assemblyman John DiMaio portray.

And I suspect strongly that they carelessly framed the story the way in which they did, because the Post and the legislator have certain attitudes, ideological biases if you will, towards public universities in general, and college students and the terms of their crushing college debt.

Miss Nicole Snooki Polizzi, of Jersey Shore fame, never spoke at the Rutgers commencement, or any commencement that I could find. And she was not paid any money by the University administration for anything. Period.

She was paid $32,000 for two evening's 'performances' of a reality show nature for student audiences by the student run entertainment committee, which is an autonomous organization controlled by students. They book over 140 events per year. While the University does collect the money which in this case amounted to roughly 90 cents per student from a pool of general fees at the very large New Brunswick campus.

In other words, Snooki, who back in 2011 apparently had a following amongst the younger set, was a hired entertainer engaged by the students themselves without active involvement of University officials. And unless we wish to try and legislate the entertainment which college students may employ with their own money, and not allow it to be an issue for student government, I don't think that the esteemed GOP legislator's and the Post's points apply.

Here is a contemperaneous article , in which the University set the record straight.

Rutgers University officials made no apologies today for Snooki's $32,000 appearance at a pair of student-run events on the Piscataway campus. The "Jersey Shore" reality TV star was invited and paid by students, who are allowed to select their own entertainment, a campus spokesman said.

"The students use funds designated for student programming. The university does not censor the speakers students choose to invite to campus," said E.J. Miranda, a Rutgers spokesman.

I remembered this incident quite well, because my number one son was a student there at the time, and I kidded him about it. He pretty much shrugged it off to the liberal arts and music school crowd over the other side of the river, himself being ensconced at the Livingston and Bush campuses for engineering, business and medical/pharmaceutical students.

And there was some thought that some elements in the legislature were perturbed that Rutgers did invite author Toni Morrison to speak at commencement, and did pay her $30,000 for it. And God knows what they payed Mr. Obama.

But it seemed snarky to attack that indirectly by throwing Snooki in, albeit falsely, thinking it played better with those who think that all public projects are foolish wastes of money, and students deserved all the bad fortune they may incur.

Thank God they did not invite Hillary. Those sort of stratospheric speaking fees are the domain of private enterprise, like the boys on Wall Street, who exercise their private judgement more precisely to get the most for their hard earned dollars. And as I recall they are also paid by the for-profit private education institutions, which have been generous with fees and sinecures for certain politicians, for example.

Let's face it. A certain amount of foolishness is a part and parcel of the coming of age rite that is a college education, or the period between high school and family life, for most participants Sowing a few wild oat when one is young is hardly an alien concept.

As I recall, I spent a huge sum on foolishness in my college career. I was a commuting student who worked as an auto mechanic three or four days a week throughout. But I hate to see what my total beer tab amounted to during that four year period.

I seem to recall consuming rather heroic volumes of beer at the school student 'mixers, and local college beer dives, with quaint names like The Downunder, Agora, and Rathskeller while in pursuit of good times and companionship of the female persuasion.

For my son's Rutgers graduating class of 2014, the University had engaged Miss Condoleezza Rice, of Bush Administration State Department fame, to speak at that their commencement. For a $35,000 by the way.

But I was grateful to be spared sitting through that on a hot day because of widespread objections to her honorarium from the University community, both faculty and students. And the faculty involvement in this was notable. And it angered our NJ Republican politicians, very much.

It also disappointed Barack Obama , by the way, who in his own subsequent commencement address to take the students to task at a later commencement address but that is another story. The professional class tends to defend the prerogatives of their own, sticking to their 'no consequences' principle for themselves and the acts of their peers, including the financiers.

And granting our betters public venues where the common people are forced to listen, but not allowed to answer back, is hardly an open sharing of ideas. I think the political parities had a close and personal organizational experience that in the recent elections.

A one-way commencement address is one thing, a debate with various viewpoints is quite another. And so the University community did what people in a weaker position always tend to do when confronted with the unspeakable- they protested against it. And far too often, protests against what the public views as outrages are crushed. That is what happened to Occupy Wall Street.

And now the out of power liberal establishment asks, why are so few protesting? Duh.

In the case of Secretary Rice, the students and faculty thought that it was hypocrisy to award an honorary law degree to someone who had consciously worked to circumvent the law, encouraged an aggressive war on contrived evidence, and helped permit the use of torture in violation of our nation's long standing principles. Condoleezza Rice Declines to Speak at Rutgers after Student Protests.

" Rice signed off to give the CIA authority to conduct their torture tactics for gathering information from detainees as well. These are clearly human rights issues. By inviting her to speak and awarding her an honorary degree, we are encouraging and perpetuating a world that justifies torture and debases humanity ."
I found it highly hypocritical of the Republican legislator and the arch-conservative Post to phrase their own stand against high commencement fees in such an incorrect manner, and dare I say false news . The Post and the politician knew better. They just did not give a damn in making their point.

And it also fits their own political bias against public works, like Universities, and any thought of relief for students who are being crushed by debt at rates significantly higher than their parents just provided to Wall Street to bail those contemptible jokers out.

[Mar 28, 2017] This corrupt neoliberal stooge Brad DeLong and conversion of university economics departments into neoliberal propaganda departments

Notable quotes:
"... Lately certain unrepentant members of that disgraced profession, some of whom claim to be the consciences of the liberal establishment, have been expressing concern about the disrepute of the 'experts' and the need to allow the technocrats to take control of policy and the economy. ..."
"... Brad DeLong, by the way, banned me from his site comments noting, 'Alan Greenspan never made a decision with which I disagreed.' Since then even Alan Greenspan has admitted he does not agree with some of his decisions, in a sniveling and sneaky kind of a non-apologetic way. ..."
"... But the specific factual point from Brad's piece that got me going was this: ..."
"... "Merton and Scholes's financial math was correct, and the crash of their hedge fund did not require any public-money bailout" ..."
"... I think it is less than trivial to know where and how the B-S risk model fails as math, as illustrated so well by Benoit Mandelbrot in his book The Misbehaviour of Markets. The math fails in its selection choice of variables and assumptions. Naseem Taleb has made a cottage industry and a personal fortune understanding this error. ..."
jessescrossroadscafe.blogspot.com
Moving along, 'liberal' economist Brad DeLong of the University of California at Berkeley history of economics penned a recent column cited over at the excellent Economist's View run by Mark Thoma. The title of Brad's column is The Need for a Reformation of Authority and Hierarchy Among Economists in the Public Sphere.

Ok I have to admit that the title alone got me into a cranky mood. Lately certain unrepentant members of that disgraced profession, some of whom claim to be the consciences of the liberal establishment, have been expressing concern about the disrepute of the 'experts' and the need to allow the technocrats to take control of policy and the economy.

Granted, they may look like the lesser of two evils in some cases, as in the current nascent administration, and in their own minds. But their policy consensus and economic recommendations of the past thirty years or so, starting with the Fed chairmanship of Alan Greenspan at least, only look good in their own selective memories. Brad DeLong, by the way, banned me from his site comments noting, 'Alan Greenspan never made a decision with which I disagreed.' Since then even Alan Greenspan has admitted he does not agree with some of his decisions, in a sniveling and sneaky kind of a non-apologetic way.

For everyone else this cycle of growing inequality, policy skews to the wealthy few, and asset bubbles and bust that serve as wealth transfer mechanisms has been particularly trying.

But the specific factual point from Brad's piece that got me going was this:

"Merton and Scholes's financial math was correct, and the crash of their hedge fund did not require any public-money bailout"
Yeah, right. Let's put aside the nicety of a Fed brokered bailout of LTCM by Wall Street money as technically not requiring public bailout money, in order to save the financial system from an epic overleveraged mispricing of risk based on that correct math.

I think it is less than trivial to know where and how the B-S risk model fails as math, as illustrated so well by Benoit Mandelbrot in his book The Misbehaviour of Markets. The math fails in its selection choice of variables and assumptions. Naseem Taleb has made a cottage industry and a personal fortune understanding this error.

And what makes it most egregious is that the error hs been known among those with mathematical minds for some time. I myself read Mandelbrot's book in 2001 and said, 'holy shit.'

Let's be clear. This was not some dumb error on the part of these fellows, or some sneaky trick. They could not resolve their math without making a certain assumption, and they did it openly and consciously. And as the write of the essay below notes, there has not been anything better produced yet to his knowledge.

It is not the theory itself that is 'bad.' It is the use and misuse to which it is put by opportunists and financial predators in misrepresenting it.

But the people who use the assumptions on risk contained in the model don't care. Like the efficient market hypothesis, it is an intellectual fig leaf that covers an epic era of looting and plundering bases on what is essentially a con game. If you assume that risk is a rare event, you can persuade the regulators and the very important people to let you run on leverage at extreme levels, especially if you can use other people's money.

Like some of the other accepted truths from the turn of the century greed is good crowd, it is a meme with which to silence the protests and permit the widespread mispricing of risk in order to reap enormous short term profits for a very few wealthy insiders. This had been going on for so long that it is almost accepted as a normal way of doing business.

Here is what an essay in Criticality had to say about the Merton-Scholes math. I suppose that the sophist would say that the math was indeed right. It was just the assumptions they used to construct the model was wrong. So 3+5 does equal 8. Its just that in the real world case there were three more factors that were tossed aside and ignored because they messed up the path to the more easily determined and reassuring result.

"This implies that rather than extreme market moves being so unlikely that they make little contribution to the overall evolution, they instead come to have a very significant contribution. In a normally distributed market, crashes and booms are vanishingly rare, in a pareto-levy one crashes occur and are a significant component of the final outcome.

It has taken years for this to be taken seriously, and in the mean time financial theory has gone on using the assumption of normally distributed returns to derive such results as the Black-Scholes option pricing equation, ultimately winning an Nobel Prize in Economics for the discoverers Scholes and Merton (Black having already died), not to mention Modern Portfolio theory (also winning Nobels). That modern finance ignored Mandelbrot's discovery and went onto honor those working under assumptions shown to be false has clearly annoyed Mandelbrot immensely and as mentioned previously he spends much of the book telling us of his prior discoveries and how he was ignored.

It is like allowing tobacco companies to widely distribute their products while a bevy of hired gun experts and media pundits and PR organizations promote the theory that tobacco is not a highly addictive substance that causes a wide range of debilitating diseases, including cancer. They know damn well that it is and it does, but they do not give a damn as long as the money is rolling in. And pity the fool who tries to stand up and tell the truth.

And so to has it been with the Banks. Indeed, the PR campaign and political donations they handled through their intermediaries during the 1990s to deregulate and overturn Glass-Steagal has to be one of the great propaganda accomplishments of the twentieth century. And the follow on campaign for the US to invade Iraq in retribution for 9/11 is not far behind it for the twenty first.

The greater point is not that the B-S model is based on faulty assumptions that greatly diminish the potential risks. Rather it is how such 'laws' of economics are so often of a dodgy, optionated and theoretical nature such that taking them as a given in forming public policy is a huge mistake in judgement.

Why? Because they may embody assumptions about what is true, and what is a priority, and what our principles and objectives may be, and propagate those assumptions (biases) into a general policy of our society that ends up causing great harm to many innocent participants. Indeed, as Obama said, there is a great need to discussion and understanding. It is just that it cannot be monopolized by a particular group of insiders who adhere to certain assumptions and professional courtesies of their own, dare I say it, class.

So there are my two corrections to the mainstream media and their writing of the public record- to suit themselves and their wealthy patrons. It seems like modern America spends an enormous amount of its intellectual capital and time on finding ways to scam the public. If we could somehow reorder the paybacks on financial corruption to even a third of what it is today we could probably cure cancer in five years or less. That is what it would take to 'make America great again,' for real and not just in the funny papers.

I would like to again stress that I am not finding fault with either of the two bloggers involved, both of whom I enjoy and admire for what they do. Mark Thoma is a class act, and even when he disagrees is very fair and open minded about it. And he keeps this site in his blogroll despite some special interests who have argued for its removal. That is more than I can say for some others.

Rather, I am trying to correct a couple of things from the broader media that seem to be factually wrong, purposely, and further, to help caution the reader that things that appear in the mainstream media written by bona fide members of the certified and qualified professional establishment cannot always be taken at face value.

The deterioration of the quality of the news is startling. I think it has a lot to do with the takeover of the media by a relatively few number of large corporations (thank you Slick Willy) Yeah, there is a lot of nutty stuff on the internet and in blogs. I spend a lot of time assessing it and avoiding it where I can. But to say that the mainstream is somehow authoritative, objective and pure is self-serving baloney at best, and a thin veneer for official propaganda when it serves the purpose at worst.

[Mar 28, 2017] Foundation - Fall Of The American Galactic Empire Zero Hedge

Mar 28, 2017 | www.zerohedge.com
Mar 27, 2017 10:40 PM Authored by Jim Quinn via The Burning Platform blog,

"The fall of Empire, gentlemen, is a massive thing, however, and not easily fought. It is dictated by a rising bureaucracy, a receding initiative, a freezing of caste, a damming of curiosity-a hundred other factors. It has been going on, as I have said, for centuries, and it is too majestic and massive a movement to stop." – Isaac Asimov, Foundation

"Any fool can tell a crisis when it arrives. The real service to the state is to detect it in embryo." – Isaac Asimov, Foundation

I read Isaac Asimov's renowned award winning science fiction trilogy four decades ago as a teenager. I read them because I liked science fiction novels, not because I was trying to understand the correlation to the fall of the Roman Empire. The books that came to be called the Foundation Trilogy (Foundation, Foundation and Empire, and Second Foundation) were not written as novels; they're the collected Foundation stories Asimov wrote between 1941 and 1950. He wrote these stories during the final stages of our last Fourth Turning Crisis and the beginning stages of the next High. This was the same time frame in which Tolkien wrote the Lord of the Rings Trilogy and Orwell wrote 1984 . This was not a coincidence.

The tone of foreboding, danger, dread, and impending doom, along with unending warfare, propels all of these novels because they were all written during the bloodiest and most perilous portion of the last Fourth Turning . As the linear thinking establishment continues to be blindsided by the continued deterioration of the economic, political, social, and cultural conditions in the world, we have entered the most treacherous phase of our present Fourth Turning .

That ominous mood engulfing the world is not a new dynamic, but a cyclical event arriving every 80 or so years. Eight decades ago the world was on the verge of a world war which would kill 65 million people. Eight decades prior to 1937 the country was on the verge of a Civil War which would kill almost 5% of the male population. Eight decades prior to 1857 the American Revolution had just begun and would last six more bloody years. None of this is a coincidence. The generational configuration repeats itself every eighty years, driving the mood change which leads to revolutionary change and the destruction of the existing social order.

Isaac Asimov certainly didn't foresee his Foundation stories representing the decline of an American Empire that didn't yet exist. The work that inspired Asimov was Edward Gibbon's multi-volume series, The Decline and Fall of the Roman Empire , published between 1776 and 1789. Gibbon saw Rome's fall not as a consequence of specific, dramatic events, but as the result of the gradual decline of civic virtue, monetary debasement and rise of Christianity, which made the Romans less vested in worldly affairs.

Gibbon's tome reflects the same generational theory espoused by Strauss and Howe in The Fourth Turning . Gibbon's conclusion was human nature never changes, and mankind's penchant for division, amplified by environmental and cultural differences, is what governs the cyclical nature of history. Gibbon constructs a narrative spanning centuries as events unfold and emperors' successes and failures occur within the context of a relentless decline of empire. The specific events and behaviors of individual emperors were inconsequential within the larger framework and pattern of historical decline. History plods relentlessly onward, driven by the law of large numbers.

Asimov described his inspiration for the novels:

"I wanted to consider essentially the science of psychohistory, something I made up myself. It was, in a sense, the struggle between free will and determinism. On the other hand, I wanted to do a story on the analogy of The Decline and Fall of the Roman Empire, but on the much larger scale of the galaxy. To do that, I took over the aura of the Roman Empire and wrote it very large. The social system, then, is very much like the Roman imperial system, but that was just my skeleton.

It seemed to me that if we did have a galactic empire, there would be so many human beings-quintillions of them-that perhaps you might be able to predict very accurately how societies would behave, even though you couldn't predict how individuals composing those societies would behave. So, against the background of the Roman Empire written large, I invented the science of psychohistory. Throughout the entire trilogy, then, there are the opposing forces of individual desire and that dead hand of social inevitability."

Is History Pre-Determined?

"Don't you see? It's Galaxy-wide. It's a worship of the past. It's a deterioration – a stagnation!" – Isaac Asimov, Foundation

"It has been my philosophy of life that difficulties vanish when faced boldly." – Isaac Asimov, Foundation

The Foundation trilogy opens on Trantor, the capital of the 12,000-year-old Galactic Empire. Though the empire appears stable and powerful, it is slowly decaying in ways that parallel the decline of the Western Roman Empire. Hari Seldon, a mathematician and psychologist, has developed psychohistory, a new field of science that equates all possibilities in large societies to mathematics, allowing for the prediction of future events.

Psychohistory is a blend of crowd psychology and high-level math. An able psychohistorian can predict the long-term aggregate behavior of billions of people many years in the future. However, it only works with large groups. Psychohistory is almost useless for predicting the behavior of an individual. Also, it's no good if the group being analyzed is aware it's being analyzed - because if it's aware, the group changes its behavior.

Using psychohistory, Seldon has discovered the declining nature of the Empire, angering the aristocratic rulers of the Empire. The rulers consider Seldon's views and statements treasonous, and he is arrested. Seldon is tried by the state and defends his beliefs, explaining his theory the Empire will collapse in 300 years and enter a 30,000-year dark age.

He informs the rulers an alternative to this future is attainable, and explains to them generating an anthology of all human knowledge, the Encyclopedia Galactica, would not avert the inevitable fall of the Empire but would reduce the Dark Age to "only" 1,000 years.

The fearful state apparatchiks offer him exile to a remote world, Terminus, with other academic intellectuals who could help him create the Encyclopedia. He accepts their offer, and sets in motion his plan to set up two Foundations, one at either end of the galaxy, to preserve the accumulated knowledge of humanity and thereby shorten the Dark Age, once the Empire collapses. Seldon created the Foundation, knowing it would eventually be seen as a threat to rulers of the Empire, provoking an eventual attack. That is why he created a Second Foundation, unknown to the ruling class.

Asimov's psychohistory concept, based on the predictability of human actions in large numbers, has similarities to Strauss & Howe's generational theory. His theory didn't pretend to predict the actions of individuals, but formulated definite laws developed by mathematical analysis to predict the mass action of human groups. His novel explores the centuries old debate of whether human history proceeds in a predictable fashion, with individuals incapable of changing its course, or whether individuals can alter its progression.

The cyclical nature of history, driven by generational cohorts numbering tens of millions, has been documented over centuries by Strauss & Howe in their 1997 opus The Fourth Turning . Human beings in large numbers react in a herd-like predictable manner. I know that is disappointing to all the linear thinking individualists who erroneously believe one person can change the world and course of history.

The cyclical crisis's that occur every eighty years matches up with how every Foundation story centers on what is called a Seldon crisis, the conjunction of seemingly insoluble external and internal difficulties. The crises were all predicted by Seldon, who appears near the end of each story as a hologram to confirm the Foundation has traversed the latest one correctly.

The "Seldon Crises" take on two forms. Either events unfold in such a way there is only one clear path to take, or the forces of history conspire to determine the outcome. But, the common feature is free will doesn't matter. The heroes and adversaries believe their choices will make a difference when, in fact, the future is already written. This is a controversial viewpoint which angers many people because they feel it robs them of their individuality.

Most people don't want to be lumped together in an amalgamation of other humans because they believe admitting so would strip them of their sense of free will. Their delicate sensibilities are bruised by the unequivocal fact their individual actions are virtually meaningless to the direction of history. But, the madness of crowds can dramatically impact antiquity.

"In reading The History of Nations, we find that, like individuals, they have their whims and their peculiarities, their seasons of excitement and recklessness, when they care not what they do. We find that whole communities suddenly fix their minds upon one object and go mad in its pursuit; that millions of people become simultaneously impressed with one delusion, and run after it, till their attention is caught by some new folly more captivating than the first." – Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

Many people argue the dynamic advancements in technology and science have changed the world in such a way to alter human nature in a positive way, thereby resulting in humans acting in a more rational manner. This alteration would result in a level of human progress not experienced previously. The falsity of this technological theory is borne out by the continuation of war, government corruption, greed, belief in economic fallacies, civic decay, cultural degradation, and global disorder sweeping across the world. Humanity is incapable of change. The same weaknesses and self- destructive traits which have plagued them throughout history are as prevalent today as they ever were.

Asimov's solution to the failure of humanity to change was to create an academic oriented benevolent ruling class who could save the human race from destroying itself. He seems to have been well before his time with regards to creating Shadow Governments and Deep State functionaries. It appears he agreed with his contemporary Edward Bernays. The masses could not be trusted to make good decisions, so they needed more intellectually advanced men to guide their actions.

"The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. We are governed, our minds are molded, our tastes formed, our ideas suggested, largely by men we have never heard of. This is a logical result of the way in which our democratic society is organized.

Vast numbers of human beings must cooperate in this manner if they are to live together as a smoothly functioning society. In almost every act of our daily lives, whether in the sphere of politics or business, in our social conduct or our ethical thinking, we are dominated by the relatively small number of persons who understand the mental processes and social patterns of the masses. It is they who pull the wires which control the public mind." – Edward Bernays – Propaganda

In Part Two of this article I will compare and contrast Donald Trump's rise to power to the rise of The Mule in Asimov's masterpiece. Unusually gifted individuals come along once in a lifetime to disrupt the plans of the existing social order.

Beam Me Up Scotty -> BaBaBouy , Mar 27, 2017 10:56 PM

" He seems to have been well before his time with regards to creating Shadow Governments and Deep State functionaries. It appears he agreed with his contemporary Edward Bernays. The masses could not be trusted to make good decisions, so they needed more intellectually advanced men to guide their actions."

The masses aren't the ones begging to start all of these wars. They are the ones TRYING to make a few good decisions. The Shadow Government and Deep State however, are hell bent on getting us all killed. Who exactly is the problem here??

LetThemEatRand , Mar 27, 2017 10:50 PM

Asimov was a good writer and created some great fiction. That's as far as it goes.

Huxle LetThemEatRand •Mar 27, 2017 10:50 PM y is the one who predicted the current state of affairs. Orwell gets honorable mention. You could also throw in some biblical passages for the mark of the beast, though the best part was clearly written about Nero.

biker Mar 27, 2017 11:06 PM
Of course its better to watch them eat themselves
https://www.theatlantic.com/politics/archive/2017/03/rewriting-the-rules...

[Mar 23, 2017] I love the smell of money-greased credentialism in the morning.

Mar 23, 2017 | www.nakedcapitalism.com
ewmayer , March 22, 2017 at 7:29 pm

Received a "new academic programs" missive from my alma mater in today's mail, containing the following:

How to Make Innovation Happen in Your Organization

The Certified Professional Innovator (CPI) program is intended to develop the competency of high potential leaders in the theory and practice of innovation. It is rooted on the principle that innovation can only be learned by doing and through many short bursts of experimentation.

The certification is comprised of a 12-week curriculum with specific syllabus and assignments for each week, including videos, workbook assignments, and reports. During the program, participants, functioning as a cohort, communicate and collaborate with each other and faculty through a series of webinars and discussions. The program culminates in project pitches.

"It is rooted on [sic] the principle that innovation can only be learned by doing and through many short bursts of experimentation" - OK, fine there, but it is also rooted in the notion that such creativity can be taught in a formal academic setting, here monetized and condensed into a 12-week program. As for me, I'm gonna hold out for the following surely-in-development mini-courses:

o Certified Professional Serial Disruptor (CPD)
o Certified Professional Innovative Thought Leader (CPCTL)
o Certified Professional Smart Creative (CPSC)

I love the smell of money-greased credentialism in the morning.

Synoia , March 22, 2017 at 10:12 pm

Certified Real Accounting Professional.
Certified Real Estate Experienced Professional

[Mar 17, 2017] Orwells 1984 was not a complete work of fiction, but a successful blueprint for full statist control

Notable quotes:
"... His book Animal Farm was a satire on Stalin and Trotsky and 1984 * gave readers a glimpse into what would happen if the government controlled every detail of a person's life, down to their own private thoughts. (*online bio). The battles in Europe were life and death with the goal of survival. ..."
"... We are now programed (propagandized) from pre school to the home for the elderly. We are initially taught as children, continue through college, and are forever conditioned by media such as TV, Movies, Radio, Newspapers and Advertising our entire lives. The younger generations are not taught to think independently or critically but instead indoctrinated with pre packaged knowledge 'propaganda' while older generations assess outcomes from a different perspective. There is as a result, a clash within the society which we are experiencing today. ..."
"... 1984 was about controlling the news and airwaves. Farenheit 451 was about burning history. The two go hand in hand. ..."
"... The similarity of the major networks evening "news" programs has given rise to a report that, each day, a list of ten or twelve "acceptable" news stories is prepared by British Intelligence in London for the networks, teletyped to Washington, where the CIA routinely approves it, and then delivered to the networks. ..."
"... The "selectivity" of the broadcasters has never been in doubt. Edith Efron, in "The News Twisters," (Manor Books, N.Y., 1972) cites TV Guide's interview with David Brinkley, April 11, 1964, with Brinkley's declaration that "News is what I say it is. It's something worth knowing by my standards." This was merely vainglorious boasting on Brinkley's part, as he merely reads the news stories previously selected for him. ..."
"... "REMEMBER THE MAINE!" That false flag headline is over a century old. ..."
"... Next time you are in a Best Buy.. go up to the Geek Squad guy and say... "So how does it feel to work for the CIA " ..."
"... Fuck the Washington Post. As Katherine Austin Fitts has suggested, it is essentially the CIA's Facebook wall. The same could be said of the NYT as well. ..."
"... James Rosen from Fox, he was at a state dept briefing with that little weasel Kirby, and Kirby stated that the negotiations over the Iran "deal" were all overt and "above the table." He remembered, tho, a briefing years earlier from the witch Psaki, who stated that sometimes, in interests of expedience, aspects of the negotiations are not made public. ..."
"... Rosen goes back to state dept video archives, finds out that his whole exchange with Psaki has been erased. Weasel Kirby, when asked how this happened, who did it, who ordered it, blames it on a "technical glitch." ..."
Mar 11, 2017 | www.zerohedge.com

FreedomWriter -> TheWrench , Mar 11, 2017 10:12 AM

Snowflakes should also learn the depressing fact that Orwell's 1984 was not a complete work of fiction, but a successful blueprint for full statist control.

Orwell was dying of tuberculosis when he wrote "1984" and passed away after its publication in 1949. Once you have their attention and they have read the book, it is time to show snowflakes the MANY obvious parallels between Orwellian concepts and modern society.

NEWSPEAK AND THOUGHT CRIME

You can start with soft targets like Newspeak (today's examples include gems like cis-gender labels and other politically correct BS).

Now move to the "thought police" and thought crime in general.

Explain how thought and speech crime keep the globalist model alive and ticking by discouraging independent thought and discussion.

Explain how state-financed institutions seek to implant these concepts at an early age and onwards into university education.

Provide real-life newspeak and double-think examples, such as "police-action" "regime-change", "coalition of the willing" and "collateral damage". Show how these are really just PC euphemisms for "wars of aggression" and "murder". If you have a picture of a droned wedding party handy, now is the time to use it.

Also mention people who have been silenced, prosecuted or even killed for committing "hate crimes" or other political blasphemies. Explain how this often occurs while they are standing up for or using their constitutionally protected human rights.

Name some of these people: Randy and Vicki Weaver, David Koresh, Marine Le Pen, Geert Wilders, Julian Assange, William Binney, Edward Snowden and Chelsea Manning

Show them how this trend is ongoing both in the USA and abroad, and is primarily being deployed against populist politicians who promote more individual rights and reduced state control over citizens. Ask them whether or not they can see a pattern developing here.

Above all, d on't waste time with cheap shots at identity politics and its absurd labelling. This will just polarize the more brainwashed members of your audience. Stick to the nitty gritty and irrefutable facts.

And be very careful here, because if they have insufficient vocabulary to understand or critique what you are saying, you will lose them. Which was the whole point of Newspeak. Of course you can use this failed learning opportunity to demonstrate just how successful the Newspeak program has been.

TELESCREENS

Tell them about the real life "Telescreens" that can now listen to you, even when turned off. Name one of their known manufacturers: Samsung and users: Central Intelligence Agency

Show them how these same telescreens are used to pump out constant lies from the MSM whenever they are turned on. Name some of these organizations: CNN, BBC, MSNBC, FOX, etc.

MASS SURVEILLANCE and the "PANOPTICON"

Talk to them about the modern surveillance state and how it will always be abused by corporate globalists and corrupt elites.

Describe how mass-surveillance service providers (MSSPs) and MSM stooges have become obscenely rich and powerful as the real-life proles (who were 85% of the population in "1984") struggle to put food on the table, pay their debts, find a decent job or buy a home. Tell them to find out how much wealth is owned by 8 very wealthy people relative to the poorest half of the world, and how this trend is accelerating. Name a few of them: Bill Gates, Mark Zuckerberg, Carlos Slim, etc.

Show how the previously enacted, totalitarian US policies, programs and laws have been extensively deployed, lobbied for, used and abused by the very Big-Brothers (Clinton and Obama) they so adored. Even George W is swooning progressives again.

Name some of these policies, programs and laws: Patriot Act, SOPA, US Telecommunications Act, FISA, Echelon, PRISM, and Umbrage

Explain why this whole surveillance system, its operators and proponents must be completely dismantled and reined in or imprisoned, unless we wish all whistle blowers, dissidents and normal citizens to end up like Winston Smith.

ETERNAL WAR AND THE BROTHERHOOD

Explain how eternal war keeps the proles from getting too restless and questioning their leaders. How it leads to modern strategic idiocies like "Osama Bin Laden and the Mujahedeen are steadfast allies against Russian totalitarianism, which is why the CIA needs to give them Stingers" (aka Operation Cyclone). Or the illegal provision of arms and funds to countries with questionable human rights records (KSA, Iran, Nicaragua, Guatemala, Israel.....)

Explain how this leads to, nay requires, state-propagated lies like WMD to justify illegal military actions against sovereign nation states like Iraq, Libya and Syria.

Show how 9/11 was used to target a former-ally Osama and his Taliban brotherhood and prepare the terrain for eternal war, even though the real criminals were actually in DC, Riyadh and other world capitals. Explain how letting Osama escape from Tora Bora was all part of this intricate plan for the PNAC, until he finally outlived his usefulness as a bogeyman. If they disagree, ask for their counter-argument and proofs.

Explain how these same criminals then made a financial killing when our real life Oceania went to war bigly with Eastasia. How this resulted in over a million civilian deaths (half of them children), around 80,000 terrorists and perhaps 10,000 uniformed soldiers/contractors. Show them videos where US officials justify this slaughter as "worth it", unimportant or irrelevant. Ask what kind of individuals could even say these things or let them happen. If they can't answer, name a few: Madeleine Albright, Hillary Clinton, Barack Obama, George W. Bush and Dick Cheney.

At this point, you may need to take a break as listeners will soon have trouble distinguishing between real-life events and those in Orwell's book.

WAR IS PEACE, FREEDOM IS SLAVERY, IGNORANCE IS STRENGTH

Next, explain how real, imagined or simulated terrorist outrages can be manipulated to influence electorates. This is done by creating or allowing atrocities that frighten citizens into seeking "safety". These citizens will then vote in corrupt, globalist leaders who promise to keep them safe. These same leaders can then curtail freedoms in their previously democratic, freedom-loving nation states. New terrorist threats can always be used to justify more restrictions on free movement and state-mandated invasions of personal privacy.

If your snowflakes don't agree with this, name some leaders responsible for bad laws, policies and the ensuing restrictions on civil liberties:

Tony Blair, George W Bush, Angela Merkel, Theresa May and Francois Hollande.

Name some events as well: Oklahoma City, 911, 7/7 Sandy Hook, 11-M

Also mention that the USA has not waged a single legal, constitutional, Congress-declared war since 1945. But that the USA has been involved in hot or cold wars for all but 5 of the past 71 years.

HISTORY AND BACKGROUND

Tell them that Orwell's original book title was actually "1944" (already past), but that his publisher vetoed this choice saying it could hurt sales.

Then explain how 1944-45 was actually the perfect crucible for the divisive, right-left political paradigm we live in today and many of the concepts presciently described in Orwell's chilling masterpiece.

EPILOGUE

Tell them everything, until their brains hurt, their eyes water and their ears bleed.

Eventually even the iciest snowflakes will get it.

Of course, some will cry, and some will have temper tantrums and meltdowns.

But a few might just wake up, start reading real books and get a proper education.

This is when the healing can begin.

Those thinking a career in gender-diversity-issue management is still the way forward may figure it out later, God help them. Until then, we should just pity them.

dearth vader , Mar 11, 2017 5:03 AM

Ira Levin's "This Perfect Day" (1970) is from the same dystopian mold. In the late Eighties, my then teenage daughter kept reading it, till it literally fell apart.

How technology has "advanced"! People in this phantasy had to wear bracelets with which they checked in and out of buildings and areas. Reality always seems to surpass the imaginative powers of SF-writers.

Maestro Maestro , Mar 11, 2017 5:16 AM

The problem is not your government.

YOU are the problem.

Your government is not populated by reptilians from outer space. The politicians and the bankers, lawyers are YOUR sons and daughters. You gave birth to them, you educated them, you taught them their values.

YOU pull the trigger when the government says KILL! YOU vote Democrat or Republican EVERY TIME. Yet you have the temerity to blame them when you don't get what you wanted.

Scum,

Hitler didn't kill anyone as fas as we know, in WWII. People [YOU] killed people. You blame the Jews because the wars they incite you to fight result in blowback to you. Why do you blame them because YOU jumped when they said JUMP! YOU are the ones flying the fighter jets and firing the tank shells against foreign populations living 10,000 miles away from your land, and who have not attacked you. NO ONE does anything unless they wanted to, in the first place. In any case, YOU are responsible for YOUR actions. This we all know.

Even your own money the US dollar is illegal according to your own US Constitution (Article 1, Section 10) yet you commit mass murder and mass torture throughout the world in order to impose it on everyone?

Fuck you, American.

BrownCoat , Mar 11, 2017 6:59 AM

The liberals are promoting the book (Nineteen Eighty-Four). IMO, that's great! Orwell's book is a classic and accurately describes features in our current society.

The downside is that the liberals won't understand it . They are promoting the idea that Trump is a fascist. They don't see that they themselves are fascists (albeit a different brand of fascism). Ironic that the book could help them see past the indoctrinated haze of their perspective, but it won't. The future, from my perspective, is a boot stamping on a human face forever.

Robert of Ottawa -> BrownCoat , Mar 11, 2017 8:09 AM

Fascism as a style of government rather than philosophy .

RevIdahoSpud3 , Mar 11, 2017 9:07 AM

I read 1984 in 1960 as a freshman in HS. Spent the next 24 years waiting. I don't remember details but I do remember it was upsetting at the time to picture my future as depicted by Orwell. It might be more interesting to me now to go back to the publishing date and study the paradigm that Orwell lived under to get a perspective of his mindset. He wasn't a US citizen. He was born in India, moved to England with his mother, had little contact with his father, was sickly and lonely as a child and suffered from tuberculosis as an adult, served in Burma for five years as a policeman, fought Soviet backed Communsts in the Spanish Civil War, fought Facism, believed in Democratic socialism or Classless socialism.

His book Animal Farm was a satire on Stalin and Trotsky and 1984 * gave readers a glimpse into what would happen if the government controlled every detail of a person's life, down to their own private thoughts. (*online bio). The battles in Europe were life and death with the goal of survival.

The European cauldron produced or nurtured, IMO, the seeds of most social evils that exist today. In Orwell's era society was changing and reacting to the Machine age which was followed by the Atomic age, the Space age and to the current Information age. He died in 1950 but in his environment, the Machine age is where he related. The forces (of evil) at work in his era still exist today with the additions of the changes brought by the later ages. We don't contend with the physical (at least not initially) conquerors such as the Genghis Khan, Mohamed, Alexander, Roman conquest etc. of the past but the compulsion of others to control our lives still exists just in different forms. We as a society react or comply and have the same forces to deal with as did Orwell but also those that resulted in the later eras. 1984 was actually the preview of the information age that Orwell didn't experience.

We are now programed (propagandized) from pre school to the home for the elderly. We are initially taught as children, continue through college, and are forever conditioned by media such as TV, Movies, Radio, Newspapers and Advertising our entire lives. The younger generations are not taught to think independently or critically but instead indoctrinated with pre packaged knowledge 'propaganda' while older generations assess outcomes from a different perspective. There is as a result, a clash within the society which we are experiencing today.

Through the modern (at least recorded) ages the underlying force no matter what era humans lived through was the conflict of...religion. In the name or names of God and whose god is the true god and which god will rule. Even in the most 'godless' societies it is the underlying force. There are many who do not believe in god or a god and by extension should or do not believe in satin. Good vs Evil? It's always there, although we are encouraged not to mention it?

Can't say I need another go at 1984 from Costco but I do need another indoor/outdoor vacuum and right now they have one with a manufacturers discount of $5. See you there!

Collectivism Killz , Mar 11, 2017 9:24 AM

1984 is really just a knock off of Evgeny Zemyatin's "We," which is frankly a better account of dystopian authoritarianism from someone who wrote shortly after the Russian Revolution.

FrankDrakman -> Collectivism Killz , Mar 11, 2017 9:39 AM

This is not true. Orwell's book touched on major points, such as the destruction of people's ability to communicate real ideas by perversion and simplification of language, that are not discussed elsewhere. It is a unique and disturbing view of totalitarian regimes.

Atomizer , Mar 11, 2017 10:22 AM

Tyler, your missing the point. 1984 was about controlling the news and airwaves. Farenheit 451 was about burning history. The two go hand in hand.

Fahrenheit 451 (1966) Full Movie | Julie Christie ...

Nobodys Home , Mar 11, 2017 10:23 AM

Manipulation of the news is not new folks:

The similarity of the major networks evening "news" programs has given rise to a report that, each day, a list of ten or twelve "acceptable" news stories is prepared by British Intelligence in London for the networks, teletyped to Washington, where the CIA routinely approves it, and then delivered to the networks.

The "selectivity" of the broadcasters has never been in doubt. Edith Efron, in "The News Twisters," (Manor Books, N.Y., 1972) cites TV Guide's interview with David Brinkley, April 11, 1964, with Brinkley's declaration that "News is what I say it is. It's something worth knowing by my standards." This was merely vainglorious boasting on Brinkley's part, as he merely reads the news stories previously selected for him.

Sinophile -> Nobodys Home , Mar 11, 2017 11:33 AM

"REMEMBER THE MAINE!" That false flag headline is over a century old.

Dragon HAwk , Mar 11, 2017 10:53 AM

Next time you are in a Best Buy.. go up to the Geek Squad guy and say... "So how does it feel to work for the CIA "

Al Bondiga , Mar 11, 2017 11:13 AM

Fuck the Washington Post. As Katherine Austin Fitts has suggested, it is essentially the CIA's Facebook wall. The same could be said of the NYT as well.

SurfinUSA , Mar 11, 2017 1:37 PM

Bezos has no problem selling "1984" on Amazon. https://tinyurl.com/hdmhu75 He's collecting the sales price and sticking it in his pocket. He's not making a joke out of it. Bezos is a lunatic. The Washington Post is full of shit. End of story.

Amy G. Dala -> SurfinUSA , Mar 11, 2017 2:23 PM

James Rosen from Fox, he was at a state dept briefing with that little weasel Kirby, and Kirby stated that the negotiations over the Iran "deal" were all overt and "above the table." He remembered, tho, a briefing years earlier from the witch Psaki, who stated that sometimes, in interests of expedience, aspects of the negotiations are not made public.

Rosen goes back to state dept video archives, finds out that his whole exchange with Psaki has been erased. Weasel Kirby, when asked how this happened, who did it, who ordered it, blames it on a "technical glitch."

It's a slippery fuckin slope. Only now the progressives are finding relevance in 1984?

[Mar 17, 2017] Costco is now carrying Orwell famouns novell 1984 And this is not a joke

Mar 11, 2017 | www.zerohedge.com
Authored by James Holbrooks via TheAntiMedia.org,

"Next time you're at Costco, you can pick up a jumbo bag of Cheetos and a copy of '1984.' Doubleplus good!"

That's how the Washington Post opened its quick little entry on Wednesday. Continuing, Ron Charles, editor of Book World for the Post , wrote:

"The discount store is now stocking Orwell's classic novel along with its usual selection of current bestsellers."

If the significance of the fact that a dystopian masterwork can now be purchased alongside a three-ton bag of cheese puffs instantly strikes you, it should. Strangely, though, Charles and the Post don't seem to see it.

In fact, it seemed to be a joke to them. The entry closed in the manner it opened. With humor:

"Appropriately, Costco is offering a reprint of the 2003 edition of '1984,' which has a forward by Thomas Pynchon. That reclusive satirist must love the idea of hawking Orwell's dystopian novel alongside towers of discounted toilet paper and radial tires. SHOPPING IS SAVING."

In the one and only instance Charles even approached something that could be considered commentary, he linked the surge in the book's sales to "alternative" news items :

"Last month, amid talk of 'alternative facts' from the Trump administration, Signet Classics announced that it had reprinted 500,000 copies, about twice the novel's total sales in 2016."

Note Charles was certain to use the word "alternative" when mentioning Trump. Why? Very clearly, "fake news" is the man's go-to phrase when speaking of the media. So why go with "alternative" instead? Hell, the Post itself was the driving force behind the "fake news" frenzy in the first place.

I could go on about how this is the Washington Post , corporate media juggernaut, attempting, rather pathetically, to poison the notion of "alternative" in the minds of its readers - or, I should say, what's left of them - but that's not really what this is about.

What it's really about is journalism. The fact that "1984" is being sold at Costco, the fact that demand for the classic tale has skyrocketed , is significant. It's societal. And journalists are supposed to write about things like that.

And what does the Post do? They make a joke of it.

This is an organization that, as recently as January, has been busted publishing false news stories. You would think that with its credibility among a growing division of society hanging on by a thread - at best - the Post would turn an event like this into social commentary. This was an opportunity to speak about a changing world.

But instead, the Post went for laughs.

Let it sink in, friends. George Orwell's "1984," a dystopian tale about a society being crushed under the boot of authoritarian regime, is, once again, flying off bookshelves. To the extent that you can now get it at Costco. Let the significance of that truly dig in deep.

Meanwhile, the Washington Post is talking about Cheetos and toilet paper.

LetThemEatRand , Mar 10, 2017 9:56 PM

It is truly Orwellian that the sheep only take interest in Orwell when someone challenges Big Brother. If I had a Facebook account, I'd post this article straight away.

LetThemEatRand , Mar 10, 2017 9:56 PM

It is truly Orwellian that the sheep only take interest in Orwell when someone challenges Big Brother. If I had a Facebook account, I'd post this article straight away.

xythras -> Luc X. Ifer , Mar 10, 2017 11:56 PM

Well, after all the shit is going down, White House is definitely in distress. Trump gets a taste of his own medicine as he's grabbed by the pussy from all intelligence agencies directions.

And Spicer just proved it today:

White House in Distress? Sean Spicer's Upside Down Flag Pin Unleashes Twitter Frenzy

http://dailywesterner.com/news/2017-03-10/white-house-in-distress-sean-s...

Luc X. Ifer -> Twee Surgeon , Mar 11, 2017 12:46 AM

Read 'Little Heroes' by Norman Spinrad. It's like the dude had a trip to the future which is our present, a completly broken society dominated by corporations exploiting the masses of hedonist mindless snowflakes. In my humble oppinion perfect companion to Orwell's 84.

[...

  • In the future the class divide between capitalist and worker will have widened to become a virtually unbridgeable chasm. In HG Wells' The Time Machine (1895) this division has become so extreme that humanity had split into two species.
  • The way to keep the underclass under control is to feed them mass-produced pseudo-culture. If - as in Orwell's 1984 (1949) - the technocratic ruling class can get some kind of computer or machine to generate this product, so much the better.
  • In the future, 20th century entertainment forms like TV and movies will have been superseded by more direct experiences that, ideally, feed directly into the brain or, at least - as with the 'feelies' in Huxley's Brave New World (1932) - stimulate more senses than simply the visual and auditory.
  • And now, here's a book that uses all these themes in one hit, and builds on these classic foundations by adding rock & roll to the mix.

    Set in the early years of the 21st century, it shows us an America decimated by devaluation, where unemployment is commonplace and rock music is firmly in the grip of accountants and electro-nerds producing synthesized superstars to keep the proles contented.

    ...]

    http://www.trashfiction.co.uk/little_heroes.html

    Latina Lover -> Luc X. Ifer , Mar 11, 2017 7:16 AM

    Washington Post = CIA produced fake news.

    peddling-fiction , Mar 10, 2017 9:59 PM

    Please read Philip K. Dick's most recent works for a more accurate description of our dystopian reality.

    RIP Philip.

    LetThemEatRand -> indygo55 , Mar 10, 2017 10:05 PM

    "Strange how paranoia can link up with reality now and then." P.K.D.

    Row Well Number 41 -> LetThemEatRand , Mar 10, 2017 10:09 PM

    Once they notice you, Jason realized, they never completely close the file. You can never get back your anonymity. It is vital not to be noticed in the first place. -- Philip K Dick

    PodissNM -> Row Well Number 41 , Mar 10, 2017 11:27 PM

    "The basic tool for the manipulation of reality is the manipulation of words. If you can control the meaning of words, you can control the people who must use the words."

    P.K.D., How To Build A Universe That Doesn't Fall Apart Two Days Later

    AlaricBalth -> peddling-fiction , Mar 11, 2017 12:13 AM

    Philip was spot on decades before the advent of the CIA's infestation of cell phones and other electronic devices.

    "There will come a time when it isn't 'They're spying on me through my phone' anymore. Eventually, it will be 'My phone is spying on me'." Philip K. Dick

    AlaricBalth -> indygo55 , Mar 11, 2017 12:30 AM

    Here is a free copy of 1984.

    https://ia800201.us.archive.org/8/items/NINETEENEIGHTY-FOUR1984ByGeorgeO...

    "The telescreen received and transmitted simultaneously. Any sound that Winston made, above the level of a very low whisper, would be picked up by it, moreover, so long as he remained within the field of vision which the metal plaque commanded, he could be seen as well as heard. There was of course no way of knowing whether you were being watched at any given moment. How often, or on what system, the Thought Police plugged in on any individual wire was guesswork. It was even conceivable that they watched everybody all the time. But at any rate they could plug in your wire whenever they wanted to. You had to live-did live, from habit that became instinct-in the assumption that every sound you made was overheard, and, except in darkness, every movement scrutinized."

    napples -> indygo55 , Mar 11, 2017 2:37 AM

    The irony never fails to amuse:

    https://www.theregister.co.uk/2009/07/18/amazon_removes_1984_from_kindle/

    bruno_the -> BeanusCountus , Mar 10, 2017 11:31 PM

    Sure. Read it again...

    As usual, the face of Emmanuel Goldstein, the Enemy of the People, had flashed on to the screen. There were hisses here and there among the audience. The little sandy-haired woman gave a squeak of mingled fear and disgust. Goldstein was the renegade and backslider who once, long ago (how long ago, nobody quite remembered), had been one of the leading figures of the Party, almost on a level with Big Brother himself, and then had engaged in counter-revolutionary activities, had been condemned to death, and had mysteriously escaped and disappeared.

    Free

    https://wikispooks.com/w/images/f/fc/1984.pdf

    Mini-Me , Mar 10, 2017 10:01 PM

    1984 was supposed to be a warning, not a user's guide.

    Twox2 -> Mini-Me , Mar 10, 2017 10:17 PM

    Too late...

    skinwalker -> Mini-Me , Mar 10, 2017 11:35 PM

    Orwell and Huxley were close to the fabians, so they knew what was coming down the pike.

    The difference is Orwell grew a conscience and tried to warn everybody.

    He probably would have titled it 2036, but 1984 was the 100th anniversary of the Fabian society.

    koan , Mar 10, 2017 10:01 PM

    WaPo is fake news, owned by a stereotypical bald headed villain. (Bezos)

    Ignorance is bliss -> aloha_snakbar , Mar 10, 2017 10:09 PM

    Maybe Orwell meant 2084. That sounds like a scary year to me...

    Anon2017 , Mar 10, 2017 10:08 PM

    You could also download "1984" for free to your computer or Kindle device. Do a Google search.

    Ms No -> Anon2017 , Mar 10, 2017 11:05 PM

    That's actually a waste of time at this point. If anything read Anthony Suttons Wall Street series for free on the internet, or stay here. You already know more than Orwell will teach you at this point. Unless your a mouth breather or blind from herpes of the eyeball. Apparently that is something contracted at birth.

    All wars are bankers wars. You can sum 1984 up to that. Actually they didn't even cover that. They just covered mechanisms. Actually they didn't even cover that, just symptoms.

    http://modernhistoryproject.org/mhp?Article=BolshevikRev&C=4.0

    http://modernhistoryproject.org/mhp?Article=WallStHitler

    http://modernhistoryproject.org/mhp?Entity=BrzezinskiZ

    SgtShaftoe -> Wee_littte_dogee , Mar 10, 2017 10:17 PM

    You're fine. Their lists don't have enough enforcers to do jack shit. By the time the first raid occurs, all hell would break loose and they'll all die.

    Ms No -> SgtShaftoe , Mar 10, 2017 10:57 PM

    In order to break that down we have to figure who their enforcers are.

    Intelligence agencies. That's a big one.

    Some unknown number of police agency staff. Quite a few in many places, like Texas. They obviously have strategic coroners, emergency room staff, etc.

    Some unknown quantitity of narco-terrorists out of Mexico/fast and furious funded types.

    Some unknown number of our military. They have been purging for decades.

    A smaller but unknown number of funded terrorist groups/ ISIS types.

    A very large number of our congress, etc.

    Probably 2/3 of our Supreme Court

    The entire media system and publishing

    The easiest way to narrow it down is who do they not have? I give up already. Remember JFK was a long time ago.

    SgtShaftoe -> Ms No , Mar 11, 2017 9:10 AM

    The ones most relevant in my mind are the logistics and support as well as the "action" guys (using that term very loosely).

    The military, the CIA and a few other agencies have trained combat arms types that are effective. The rest are at various stages of competency. In any event, they still don't have enough competent troops by a long shot. The logistics tail is also very wide and vulnerable.

    [Mar 17, 2017] While I think primary education especially has suffered tremendously in the US, education is a terribly necessary but far from sufficient solution to the problems.

    Mar 17, 2017 | economistsview.typepad.com

    Longtooth : March 16, 2017 at 08:08 PM While I think primary education especially has suffered tremendously in the US, education is a terribly necessary but far from sufficient solution to the problems.

    The far greater problem, imo, is the distribution of incomes which create the divergences in primary & secondary education.. which is a direct outgrowth of educational funding by school districts, which is differentiated by the tax base, which of course then determines the quality of the education. Add this to poorer lower and lower middle class neighborhoods where both parents work (mostly) in low wage and low benefits jobs and the environment rubs off directly on the kids.

    Why do we promote divergence in neighborhood wealth? This is a direct result of and part of income inequality so it's not just the 1% that are the problem.. they're just a popular and clear-cut indicator of it. We create these ghetto-like islands by a political and belief system that promotes "individualism", that believes if you've got a good high paying job that it's because you "earned it" yourself and therefore "deserve it".

    Education will not solve the upward mobility issue we now have in spades and which spirals to less mobility by feed-back loops.

    [Mar 03, 2017] In praise of credentialism

    crookedtimber.org

    Crooked Timber

    That's the title of my latest piece in Inside Story. The crucial para
    The term "credentialism" is used in many different ways, some of them contradictory, but the implication is consistent: too many young people are getting too much formal education, at too high a level. This implication was spelt out recently by Dean Ashenden, who contends that "education has not just grown to meet the expanding needs of the post-industrial economy, but has exploded like an airbag." The claim that young people are getting too much education, and the supporting critique of credentialism, is pernicious and false.

    John Barker 03.01.17 at 10:44 am

    Great piece, John!

    The suffix "-ism" hits my hot button- unless it's optimism. It denotes the ossification of of an idea that may once have been dynamic.

    I tend to look at ideas through the prism (oops!) of life-cycles. There's a time, perhaps, at the "mature" stage, where codification becomes the norm. After that- particularly when organisations become corporatised in an attempt to revitalise them (eg Trumpism)- codification becomes essential for the masses, but discretionary for the bosses. Luckily, it tends to be contemporaneous with the development of new systems, as you indicate, where the activity hasn't matured sufficiently to be credential-ivied.

    I'm trying to tackle this in a book on "Concepts in Innovation and Change"- first 8 chapters for free download and feview at my website http://www.thepicketline.net/innovation.

    Keep up the good work!

    2

    JK 03.01.17 at 11:26 am

    "The stress on formal credentialism – the specific requirement for an educational qualification to be a member of a defined profession – is a phenomenon whose time has passed."

    Not sure about this. cf which I think made a bit of a ripple.

    3

    Ebenezer Scrooge 03.01.17 at 1:13 pm

    I'm in the "yes, but" camp.
    First, credentialism may be well-established in primary and secondary teaching, but that doesn't mean it isn't a problem. There is a significant shortage of secondary STEM teachers, and a fair surplus of 40-year old engineers and military types, many of whom are skilled at dealing with the young. But they lack formal ed training, which can be a significant barrier in many districts.
    Second, much advanced education in universities does not go on in classrooms. I got my Ph.D. in chemistry. The first year was classrooms and picking a research advisor. The next 3-5 years were all in the lab: pure apprentice work. When we got out, nobody was interested in our classroom grades.
    Third, although I'd be the first to admit that general higher education skills are very useful in the workplace, I'm very skeptical about any classroom teaching of specific job-oriented skills. Apart from accounting, what skills does an MBA acquire in a classroom? Every law firm thinks their rookie lawyers are completely untrained, and the second and third years of law school are a waste. (Indeed, Yale Law School turns this into a point of honor: barely trying to teach law.) Medical training is two years of classroom and interminable time in the hospital wards. Engineering may be the exception.
    4

    engels 03.01.17 at 1:20 pm

    I agree very strongly with the second part on education not being a panacea for inequality.

    I don't think credentialism has to imply 'too many young people are getting too much formal education, at too high a level'. I see it as pathology of managerialism in hiring practices which sets irrational requirements for candidates for jobs. It doesn't have to mean formal credentials and is perhaps more typically years of experience in a specific role. (To be a barman you two years experience of bartebding etc). Unpaid internships and gap year/CV-boosting stuff maybe also qualify.

    Imo credentialism is a real problem and it's also a problem that the expansion of higher education (which I agree is a good thing) has gone hand in hand with the tightening grip of a brutally instrumental view of the purposes of education, as a process that socialises nascent wage-labourers for a life of wage labour. So I don't think it's too jaded to see the vaunted expansion of 'educational opportunities' in the last couple of decades as little more than an arms race for access to an ever-dwindling number of marginally privileged positions within an increasingly exploitative system of production funded by a burgeoning debt burden on workers.

    It doesn't have to be this way! But I fear that equating credentials (i.e. formal or informal qualifications explicitly demanded by employers for a specific economic role) with education (study, reading, learning, the life of the mind, ) may not be conducive to progress here.

    5

    Frowner 03.01.17 at 1:22 pm

    If a lurker may comment: I hate to say this, but I completely disagree. I am a person with quite a lot of education who none the less works in a low-level accounting position, and I am completing an accounting certification.

    Things I've observed:
    1. Accounting for most lower level roles is best learned on the job. None of the formal accounting that I've studied has very much to do with the actual work I do. Most of what I do is highly specific to the place I work, and had to be learned bit by bit on the job.

    2. I started getting my accounting certificate because although I had "apprenticed" with someone up the ladder and had learned enough to move on, I was informed that without a certification I could never be hired, no matter what experience I had.

    3. My accounting certification program requires a long, long list of "information science 101"-style classes which are the most godawful, banal, fraudulent, pro-corporate things I've ever seen. "Read this short article about self-driving cars"-level terrible. We often receive actively misleading information. This is in a nationally known program which boasts of its connections to fancy accounting firms.

    4. I only got into my current job by a fluke – it's not classed as a regular accounting gig, so they were willing to hire me based on .my experience of accounting. Experience I'd acquired in my previous not-formally-accounting job by volunteering to learn new stuff.

    5. My employer has terrible trouble hiring skilled people, because they require a great deal of certification for entry-level jobs and don't pay that much. People with accounting certifications, for instance, nearly always start out earning about $25,000 more than my employer pays entry level workers. But instead of hiring people who are trainable and have relevant but unspecific experience, my employer holds out for the credential. As a result, we have a lot of churn.

    6. On another note: I've spent much of my work life in pink collar jumped-up file clerk occupations. On no occasion did I need college level training for "database management", using MS Office, etc. That's not how working with databases goes at the file clerk level. What happens is that you're hired and then socialized into your employer's specific use of databases. (Also, the kind of "database management" that you need to do as a file clerk is maybe creating some kind of Filemaker or Access database – I was allowed to do this rather than kicking it over to IT because I was an enterprising young person, but this was not typical of file clerk jobs.)

    Most pink collar work is deskilled. You work with databases, but in a very restricted way that they try to make as idiot-proof as possible. You work with MS Office, but doing mostly a short list of predetermined things – even if some of them are obscure, the list itself is short.

    I sometimes think that professional class people, because they lack experience of the day to day of pink collar work and "business" education, are a little bit vulnerable to talk of new technologies, etc.

    6

    ترول 03.01.17 at 1:41 pm

    I was brought up short by the discussion around "It Takes a B.A. to Find a Job as a File Clerk".

    "Someone seeking a job as a file clerk, for instance, would be well advised to acquire a knowledge of computer programs such as Microsoft Office, and an understanding of database management. This is likely to be done more efficiently in a classroom setting than by osmosis in a busy office."

    It is no doubt true that a recent university graduate is guaranteed to have acquired "a knowledge of computer programs such as Microsoft Office" (not, in general, of database management). Some of them – hopefully not many! – may even have waited until university to acquire this knowledge, through some regrettable failure of their high schools. But spending years at university, and thousands of dollars in tuition fees, to learn this is massive overkill. You could learn to use MS Office in a dedicated course in a week or two – or on your own even faster, depending on your personality. The other 95% or so of the time and money you've spent on your university training is going to be irrelevant to your job as file clerk. Even if we grant that it's OK for the employer to pass the financial burden of training entirely on to job-seekers – which is kind of the crux of the problem here! – how is it reasonable for an employer to discriminate against someone for taking the obvious shortcut and learning all the skills that are going to be relevant to the job without passing through university?

    More broadly, there's no automatic contradiction between jobs now requiring greater skill and employers demanding unnecessary or excessive qualifications. Suppose a job that used to need high school levels of achievement now needs extra skills equivalent to a year's worth of university-level study. There's no such thing as a 1-year university degree (rightly), so the easiest solution for employers is to demand a university degree for the post – 2 years of which would be superfluous to their requirements. That requires would-be employees to spend thousands of dollars extra of their own money.

    7

    Zamfir 03.01.17 at 1:44 pm

    When people complain about credentialism, the typical assumption is that many jobs could be learned on the job, just as well or better as in a class. And that's often true, even for many fairly difficult and prestigious jobs. But the second, implicit, assumption is then that on the job training is free. So people compare the high costs of formal education, and start complaining about credentialism, or the high wages of teachers etc.

    The point is of course that good on the job training is expensive. It consumes a lot of time of senior people, and organisations are hesitant to provide too much of it. Higher education grows not because it is the best way to learn jobs, but because there is not enough serious on the job training available.

    Doctors are the prime example – they are in short demand and highly paid in most countries, with very different medical systems. Even though many seemingly qualified people want to be doctors. The bottleneck is never the classroom education – it's the required apprenticeships and assistent-doctor positions.

    People who complain about credentialism are really asking that more job markets resemble that for doctors, even though they often use the doctors as the prime example of credentialism gone wrong.

    8

    DrDick 03.01.17 at 3:21 pm

    I am quite sure conservatives hate the idea of a more educated population, since it is harder for them to sell their snake oil. On the other hand, there really are a lot of jobs now that expect, if not actually require, applicants to have some college, but where that is not actually needed for the job.
    9

    Quite Likely 03.01.17 at 4:37 pm

    To me the core of what people are talking about with "credentialism" is the vicious cycle of increased educational requirements for jobs and increasing average levels of education. Having more educational credentials helps people get jobs, so people get more credentials, so the level of credentials a given job asks for rises. Assuming that productivity doesn't actually rise proportionally with education (which I think is pretty inarguable) it just ends up meaning an ever-increasing amount of time and resources goes to the credential-seeking game without accomplishing much.

    There's a great illustration of the dynamic in Scott Alexander's parable of the tulips: https://slatestarcodex.com/2015/06/06/against-tulip-subsidies/

    10

    Anarcissie 03.01.17 at 5:04 pm

    It seems to me that the usual complaint about credentialism is not that education is a bad or superfluous thing, but that the credentials presently in use don't have a lot to do with the work they are supposed to reflect, and are mostly an artefact of the education industry and the class structure of the surrounding society. One or more horror-lite anecdotes upon request.
    11

    CaptFamous 03.01.17 at 7:06 pm

    @Anarcissie – Seconded.

    The relative prestige associated with certain degrees from certain schools implies they are a better indicator of capability, but grade inflation and cheating scandals in the Ivy League suggest that rather than being held to a higher standard, students there are often given more leeway to skate by. The degree is treated with reverence, but in effect can often be little more than a gold-embossed acceptance letter.

    This is exacerbated by the idea (and often reality) that jobs demand qualifications for applicants that they don't utilize. It doesn't matter if you didn't learn the things your resume says you learned in college if your employer doesn't actually need you to do the things they say they need you to do once you're hired.

    12

    Matt 03.01.17 at 7:53 pm

    Compared to people accumulating mountains of student loan debt and struggling to find decent jobs, this is a really petty complaint, but: credentialism also makes higher education worse for students who are interested in more than getting that degree to unlock the game progression to "a good job."

    I attended a SLAC around the turn of the millennium. I picked that school instead of a cheaper state school because I bought into the "life of the mind" campus tour messaging. My professors and fellow students would be personally engaged with interesting questions across many disciplines! It was true of the professors, actually. It was also true in smaller elective courses that nobody attended simply to fill requirements. But in mandatory courses or "easy-looking" electives there were a lot of seatwarmers who'd complain outside of class that history or philosophy or whatever was never going to be useful for a job, so we shouldn't have to take these boring useless courses. I thought: yes, I too would be happier if you all weren't attending these classes that just bore and annoy you.

    It wasn't until graduate school that I felt like my fellow students were there primarily due to a thirst for knowledge. It reminds me of the aphorism that a master's degree is the new bachelor's degree.

    13

    David 03.01.17 at 7:57 pm

    Much has already been said, but I assume we're all comfortable with the idea that spending time at an institution and leaving with a piece of paper is not the same as education: it's increasingly just a measure of social control, since you have to pay a fortune to get the piece of paper which probably over-qualifies you for the job you get. I've heard, incidentally, that recruiting consultancies (another parasitic life-form) now have software which automatically scans job applications and rejects all those that don't have very precise qualifications in the right boxes.
    I can't help thinking of my father who had no qualifications of any kind (he left school at 14 as was normal then) and whose first job after the War was as a wages clerk in a factory. OK, there was no Microsoft Office then, but he was expected to work out wages by hand in pounds, shillings and pence, with the aid of a ready-reckoner. I wonder how many people could do the contemporary equivalent, even with higher educational credentials. And credentials are pointless anyway unless they actually reflect genuine abilities that your education has given you.
    14

    Omega Centauri 03.01.17 at 7:59 pm

    Maybe the purpose of a ceredential is not that it's owner knows what is needed for the job you are offering, but is evidence of a certain level of displine and intellectual capability. So the odds of hiring someone for whom on-the-job training doesn't stick, -or who lacks basin self-discipline are greatly reduced by requiring the credential.
    15

    Collin Street 03.01.17 at 8:09 pm

    Specifically on databases: there's a number of subtleties on proper database design [normal forms] that are pretty much impossible to learn on-the-job because very few people without formal training knows about them.
    16

    Cian 03.01.17 at 8:39 pm

    One more example for the vicious cycle of educational requirements. The organization my wife spent a fair bit of her career working for had a mixture of graduates and non-graduates doing the same roles. The graduates were simply younger – hired when HR mandated (because they could due to the rise in university education) a degree. While the job was pretty skilled, she never noticed any difference in ability.

    Another example would be that of clerks, where computerization has reduced the skill level required. File keeping, tracking orders and book keeping without computers is bloody hard.

    17

    Cian 03.01.17 at 8:42 pm

    @Zamfir:
    Doctors are the prime example – they are in short demand and highly paid in most countries, with very different medical systems. Even though many seemingly qualified people want to be doctors. The bottleneck is never the classroom education – it's the required apprenticeships and assistent-doctor positions.

    Actually the bottleneck in the US and UK is that the doctors' guilds keep training numbers down. Other countries (i.e. Germany) don't allow them to do this, and have plenty of doctors as a result. And doctors pay in the US is anomalous – it's nothing like that in the rest of the world

    18

    Cian 03.01.17 at 8:45 pm

    Third, although I'd be the first to admit that general higher education skills are very useful in the workplace, I'm very skeptical about any classroom teaching of specific job-oriented skills.

    The Engineering profession will not allow you to become a full engineer until you have completed a certain number of years in the workplace.

    19

    Murc 03.01.17 at 8:52 pm

    Count me in with DrDick, Frowner, engels, and the others with their pushback.

    In fact, I'll go one step further: I would say that this: "The term "credentialism" is used in many different ways, some of them contradictory, but the implication is consistent: too many young people are getting too much formal education, at too high a level." is, if not a strawman, definitely straw-adjacent.

    Education is a good thing! People getting more education is a good thing. The term in no way implies what John says it is implying, and I don't often encounter the argument that we, as a populace, are over educated. This argument is absurd on its face and easily knocked down. John does a great job of knocking it down, which would be excellent work if it were, you know relevant.

    What I encounter far more often with regards to the term "credentialism" is basically thus: people have been sold the idea that educational credentials are the ticket to a good life, a life of economic security where you can have a good job and raise a family and not constantly worry about the wolf at the door. However, while there is real absolute value in the education those credential signal their possessors having, a lot of that value is also relative and has to do with scarcity. The more people who possess those credentials, the less they're worth in the job market, which is the reason you got them in the first place.

    And as a result of that you get employers establishing arbitrary and ever-increasing credential requirements for jobs that absolutely don't require those credentials, as a way of weeding out the riff-raff. Sure, that position doesn't require a masters, but if you can advertise it with a masters and still get forty well-qualified applicants, why wouldn't you do that?

    And this masks the underlying problem, which is that, basically, there aren't enough good jobs to go around to everyone, and we've constructed a lot of bullshit hurdles ("Education! Education is the silver bullet!") to avoid having to deal with that. Education is great. I think post-secondary education should be available publicly free of charge, like primary and secondary education is. But even if the college graduation rate were 100% well, someone has to flip our burgers and work our cash registers, and right now those jobs aren't considered respectable and they're sure as hell not compensated respectably.

    I will say this: the argument that young people are getting too much education does hold water if you add a "because" with a good reason after it. What immediately springs to mind is Paul Campos' ongoing war against law schools; he advises young people not to go to law school because they'll get "too much education," but because they'll assume life-destroying mountains of debt and that the return on that investment won't be worth it.

    20

    Cian 03.01.17 at 8:53 pm

    I sometimes think that professional class people, because they lack experience of the day to day of pink collar work and "business" education, are a little bit vulnerable to talk of new technologies, etc.

    The example of this that drives me crazy is computer programmers. The reality is that most computer programming jobs are not difficult – many of them could be carried out (and sometimes are) by a smart high schooler. Generally when graduates do these jobs – they use nothing that they learnt at college to do them. They're carried out by business, or English, or (sometimes) science/maths graduates.

    Now there are definitely exceptions to this. There are computer programming jobs that are very hard, and for which you do need a Computer Science, or Maths degree, and a lot of technical skill. But these are the exception. The 'App economy', and the corporate IT world, largely consist of mediocre programmers – who are astonishingly ignorant of basic Computer Science concepts, but muddle through creating mediocre software.

    21

    ترول 03.01.17 at 10:30 pm

    Just want to add that I very much endorse engels' comment above:

    "I fear that equating credentials (i.e. formal or informal qualifications explicitly demanded by employers for a specific economic role) with education (study, reading, learning, the life of the mind, ) may not be conducive to progress here."

    22

    Moz of Yarramulla 03.01.17 at 10:33 pm

    From the employer side, though, the choice is often between five candidates who have the BA, and twenty who don't. Since it's more likely that the BA candidates will be capable employees, it makes some sense to eliminate the less credentialled immediately (because interviewing people isn't free any more than on the job training is). I have been part of a hiring process where we got hundreds of applications every time we advertised, and had to grind through them looking for that one unicorn-like candidate who was worth hiring. Immediately binning anyone who didn't follow the instructions or possess the requisite qualifications was simply essential to save time. As it was we spent probably $20,000 of staff time filtering ~600 applications down to 15 interviewees, then interviewing the 10 who turned up.
    23

    Moz of Yarramulla 03.01.17 at 10:34 pm

    With the "modern careers" like programming, there's usually a huge gap between people who have the credentials and those who don't. It's not so much in the one job they have, it's their ability to keep working as a programmer through their life. University demonstrates possession of the "how to learn" skill in a way that learning on the job doesn't. There are more than a few non-graduate programmers who are locked into that one job they got somehow, and they can't leave. Or they can leave, but they'll be working as a greeter at a box store if they do.

    There is, though, a lot of cross-over with ageism in general and in tech jobs particularly. It doesn't matter how skilled you are if the employer is willing to hire a recent graduate for less than you can afford to accept. I'm reminded of the many article on open plan offices – too many employers accept lower productivity from cheap staff/overcrowded offices etc because it never occurs to them that paying more might get a better result. Or they can't get that thought through the internal bureaucrazy. Or worse, it doesn't survive the next arbitrary "cut staffing costs by 23%" edict.

    24

    peterv 03.01.17 at 10:35 pm

    Related is the Paper Qualifications Syndrome, which was of such great concern to some in the 1980s that the ILO spent money studying it. The PQS was the trend by employers to favour recruits with formal qualifications over those without, even when those without may have had relevant work experience.

    One reason employers may favour graduates for low level office jobs is that employers know that technology is no longer static. It is not merely that file clerks need today to know how to run databases, but also that such employees will need an entirely different set of technical office skills in 20 years time. Graduates, having learnt how to learn, are generally better able to cope in this environment than people whose formal education ended at 18.

    25

    peterv 03.01.17 at 10:42 pm

    There is a related phenomenon which the UK academic mathematics community has noted. Increasingly, employers no longer need people with only a first degree in mathematics, because much routine math work can be assigned to machines. But some sectors, eg finance, national security, still need original math to be done, which means they need recruits with PhDs in mathematics. The demand for math PhDs used to be a small percentage of the demand for math graduates. If teachers are excluded from the demand figures, this is likely to be reversed: More PhDs are needed than plain graduates. This phenomenon has important implications for education policy.
    26

    EB 03.01.17 at 10:48 pm

    I'm all for more education, of all sorts. The problem we have now with some types of education is that it's thin, delivered in the same way all the way from maybe Grade 3 to post-secondary, and is starting to NOT signal anything to potential employers. This is especially true for several post-secondary majors like Communications, Marketing, Family Science, etc. And there are other majors that graduate far more young people than the economy can absorb - Graphic Arts, Education, Hospitality, etc. Yes, it signals that the student had enough self-discipline (and money) to persist, but is this really enough?
    27

    John Quiggin 03.01.17 at 10:53 pm

    Assuming that productivity doesn't actually rise proportionally with education (which I think is pretty inarguable)

    [Feb 27, 2017] Leoliberal privitization of eduction went way too far

    Feb 27, 2017 | economistsview.typepad.com

    anne : February 24, 2017 at 05:00 PM , 2017 at 05:00 PM

    https://www.nytimes.com/2017/02/23/upshot/dismal-results-from-vouchers-surprise-researchers-as-devos-era-begins.html

    February 23, 2017

    Dismal Voucher Results Surprise Researchers as DeVos Era Begins
    By Kevin Carey

    The confirmation of Betsy DeVos as secretary of education was a signal moment for the school choice movement. For the first time, the nation's highest education official is someone fully committed to making school vouchers and other market-oriented policies the centerpiece of education reform.

    But even as school choice is poised to go national, a wave of new research has emerged suggesting that private school vouchers may harm students who receive them. The results are startling - the worst in the history of the field, researchers say.

    While many policy ideas have murky origins, vouchers emerged fully formed from a single, brilliant essay * published in 1955 by Milton Friedman, the free-market godfather later to be awarded a Nobel Prize in Economics. Because "a stable and democratic society is impossible without widespread acceptance of some common set of values and without a minimum degree of literacy and knowledge on the part of most citizens," Mr. Friedman wrote, the government should pay for all children to go to school.

    But, he argued, that doesn't mean the government should run all the schools. Instead, it could give parents vouchers to pay for "approved educational services" provided by private schools, with the government's role limited to "ensuring that the schools met certain minimum standards."

    The voucher idea sat dormant for years before taking root in a few places, most notably Milwaukee. Yet even as many of Mr. Friedman's other ideas became Republican Party orthodoxy, most national G.O.P. leaders committed themselves to a different theory of educational improvement: standards, testing and accountability. That movement reached an apex when the No Child Left Behind Act of 2001 brought a new focus on tests and standards to nearly every public school nationwide. The law left voucher supporters with crumbs: a small demonstration project in Washington, D.C.

    But broad political support for No Child Left Behind proved short-lived. Teachers unions opposed the reforms from the left, while libertarians and states-rights conservatives denounced it from the right. When Republicans took control of more governor's mansions and state legislatures in the 2000s, they expanded vouchers to an unprecedented degree. Three of the largest programs sprang up in Indiana, Louisiana and Ohio, which collectively enroll more than a third of the 178,000 voucher students nationwide.

    Most of the new programs heeded Mr. Friedman's original call for the government to enforce "minimum standards" by requiring private schools that accept vouchers to administer standardized state tests. Researchers have used this data to compare voucher students with similar children who took the same tests in public school. Many of the results were released over the last 18 months, while Donald J. Trump was advocating school choice on the campaign trail.

    The first results came in late 2015....

    * http://la.utexas.edu/users/hcleaver/330T/350kPEEFriedmanRoleOfGovttable.pdf

    anne -> anne... , February 24, 2017 at 05:00 PM
    http://la.utexas.edu/users/hcleaver/330T/350kPEEFriedmanRoleOfGovttable.pdf

    1955

    The Role of Government in Education
    By Milton Friedman

    The general trend in our times toward increasing intervention by the state in economic affairs has led to a concentration of attention and dispute on the areas where new intervention is proposed and to an acceptance of whatever intervention has so far occurred as natural and unchangeable. The current pause, perhaps reversal, in the trend toward collectivism offers an opportunity to reexamine the existing activities of government and to make a fresh assessment of the activities that are and those that are not justified. This paper attempts such a re-examination for education.

    Education is today largely paid for and almost entirely administered by governmental bodies or non-profit institutions. This situation has developed gradually and is now taken so much for granted that little explicit attention is any longer directed to the reasons for the special treatment of education even in countries that are predominantly free enterprise in organization and philosophy. The result has been an indiscriminate extension of governmental responsibility.

    The role assigned to government in any particular field depends, of course, on the principles accepted for the organization of society in general. In what follows, I shall assume a society that takes freedom of the individual, or more realistically the family, as its ultimate objective, and seeks to further this objective by relying primarily on voluntary exchange among individuals for the organization of economic activity. In such a free private enterprise exchange economy, government's primary role is to preserve the rules of the game by enforcing contracts, preventing coercion, and keeping markets free. Beyond this, there are only three major grounds on which government intervention is to be justified. One is "natural monopoly" or similar market imperfection which makes effective competition (and therefore thoroughly voluntary ex change) impossible. A second is the existence of substantial "neighborhood effects," i.e., the action of one individual imposes significant costs on other individuals for which it is not feasible to make him compensate them or yields significant gains to them for which it is not feasible to make them compensate him-- circumstances that again make voluntary exchange impossible. The third derives from an ambiguity in the ultimate objective rather than from the difficulty of achieving it by voluntary exchange, namely, paternalistic concern for children and other irresponsible individuals. The belief in freedom is for "responsible" units, among whom we include neither children nor insane people. In general, this problem is avoided by regarding the family as the basic unit and therefore parents as responsible for their children; in considerable measure, however, such a procedure rests on expediency rather than principle. The problem of drawing a reasonable line between action justified on these paternalistic grounds and action that conflicts with the freedom of responsible individuals is clearly one to which no satisfactory answer can be given.

    In applying these general principles to education, we shall find it helpful to deal separately with (1) general education for citizen ship, and (2) specialized vocational education, although it may be difficult to draw a sharp line between them in practice. The grounds for government intervention are widely different in these two areas and justify very different types of action....

    [Feb 26, 2017] Aldous Huxley - Wikipedia

    Feb 26, 2017 | en.wikipedia.org

    Huxley had deeply felt apprehensions about the future the developed world might make for itself. From these, he made some warnings in his writings and talks. In a 1958 televised interview conducted by journalist Mike Wallace , Huxley outlined several major concerns: the difficulties and dangers of world overpopulation; the tendency toward distinctly hierarchical social organisation; the crucial importance of evaluating the use of technology in mass societies susceptible to wily persuasion; the tendency to promote modern politicians to a naive public as well-marketed commodities. [32]

    [Feb 26, 2017] If one takes it as a matter of faith (religious or secular) that human activity inherently leads to good outcomes that'll be a huge influence on how you engage with the world. It blows

    Feb 26, 2017 | economistsview.typepad.com
    away humility and restraint. It fosters a sense of entitlement.

    Chris G said... February 24, 2017 at 04:48 AM On the Crooked Timber piece: Quiggin makes a very astute observation about 'propertarians' and Divine Providence in his concluding paragraphs. If one takes it as a matter of faith (religious or secular) that human activity inherently leads to good outcomes that'll be a huge influence on how you engage with the world. It blows away humility and restraint. It fosters a sense of entitlement. RC AKA Darryl, Ron said in reply to Chris G ... Yep. All roads lead to scapegoating. The anti-social capabilities of base desires and greed are often paled in comparison to those of detached indifference supported by abstract high-mindedness. For example, both sides can blame the robots for the loss of decent blue collar jobs. RC AKA Darryl, Ron said in reply to RC AKA Darryl, Ron... Not sure that there are "both sides" any more in elite circles. There are at least two types though. There is very little presence among elites on the progressive side. Reply Friday, February 24, 2017 at 04:58 AM Chris G said in reply to RC AKA Darryl, Ron... Hard to call this related but worth reading, Why Nothing Works Anymore - https://www.theatlantic.com/technology/archive/2017/02/the-singularity-in-the-toilet-stall/517551/
    Reply Friday, February 24, 2017 at 05:11 AM RC AKA Darryl, Ron said in reply to Chris G ... [THANKS! This was LOL funny:]

    "...When spun on its ungeared mechanism, an analogous, glorious measure of towel appears directly and immediately, as if sent from heaven..."

    [This was highly relevant to today's lead article "The Jobs Americans Do:"]

    ..."Precarity" has become a popular way to refer to economic and labor conditions that force people-and particularly low-income service workers-into uncertainty. Temporary labor and flexwork offer examples. That includes hourly service work in which schedules are adjusted ad-hoc and just-in-time, so that workers don't know when or how often they might be working. For low-wage food service and retail workers, for instance, that uncertainty makes budgeting and time-management difficult. Arranging for transit and childcare is difficult, and even more costly, for people who don't know when-or if-they'll be working.

    Such conditions are not new. As union-supported blue-collar labor declined in the 20th century, the service economy took over its mantle absent its benefits. But the information economy further accelerated precarity. For one part, it consolidated existing businesses and made efficiency its primary concern. For another, economic downturns like the 2008 global recession facilitated austerity measures both deliberate and accidental. Immaterial labor also rose-everything from the unpaid, unseen work of women in and out of the workplace, to creative work done on-spec or for exposure, to the invisible work everyone does to construct the data infrastructure that technology companies like Google and Facebook sell to advertisers...

    [This was very insightful into its own topic of the separation of technology "from serving human users to pushing them out of the way so that the technologized world can service its own ends," but I would rather classify that as serving owners of proprietary technology rights.]


    ...Facebook and Google, so the saying goes, make their users into their products-the real customer is the advertiser or data speculator preying on the information generated by the companies' free services. But things are bound to get even weirder than that. When automobiles drive themselves, for example, their human passengers will not become masters of a new form of urban freedom, but rather a fuel to drive the expansion of connected cities, in order to spread further the gospel of computerized automation. If artificial intelligence ends up running the news, it will not do so in order to improve citizen's access to information necessary to make choices in a democracy, but to further cement the supremacy of machine automation over human editorial in establishing what is relevant...

    [THANKS! It was an exceptionally good article in places despite that it wandered a bit off into the ozone at times.]

    ...
    Reply Friday, February 24, 2017 at 05:54 AM Julio said in reply to Chris G ... Excellent article, thanks!

    It hits on one of the reasons why I am less skeptical than Darryl that AI will succeed, an soon, in all kinds of fields: it may remain stupid in some ways, but we will adapt to it.

    Consider phone answering services. Its simple speech recognition, which was once at the forefront of artificial intelligence, has made them ubiquityous. Yet Dante would need a new circle for a person who said "I just heard you say 5...3...7...is this correct?"

    Some of these adaptations subtract from our quality of life, as the article nicely describes. Some add to it, e.g we no longer spend time at the mall arranging when and where to meet if we get separated. Some are interesting and hard to evaluate, e.g. Chessplayers' relation to the game has changed radically since computers became good at it.

    And there is one I find insidious: the homogeneization of human activity and even thought. The information we ALL get on a subject will be what sorts to the top among google answers; the rest might as well not exist, much like newspaper articles buried in a back page.

    On the political front, Winston will not be necessary, nobody will click through to the old information, we will all just know that we were always at war with Eurasia.

    And on the economic front, the same homogeneization, with giant multinationals and crossmarketing deals. You'll be in a country with great food, like Turkey, get into your rented Toyota, say "I want dinner", and end up at a Domino's because they have a deal with Toyota.

    Resist! Reply Friday, February 24, 2017 at 09:26 AM Paine said in reply to Julio ... Humans are more contrarian then not

    The middle third of the twentieth century was hysterical about the totalitarian state
    And the erasure of micro scale cultural heritage

    That seems laughable since at least 1965 as lots of old long dormant memes
    Revived in these frightfully "totalized " civil societies

    The Motions of human Society reveal underlying dialectics not mechanics Reply Friday, February 24, 2017 at 09:55 AM Paine said in reply to Paine... "1984 " is way past it's sell by date

    Much like Leviathan and the declaration of independence Reply Friday, February 24, 2017 at 09:59 AM cm said in reply to Julio ... There was probably more than one movie about this topic - people not happy with their "peaceful" but bland, boring, and intellectually stifling environment.

    Not too far from Huxley's "Brave New World" actually. Reply Saturday, February 25, 2017 at 12:01 AM

    [Feb 26, 2017] The Revenge Of Comet Pizza Zero Hedge

    Feb 26, 2017 | www.zerohedge.com

    Remember that one? It was about as weird as it gets. A meme generated out of the voluminous hacked John Podesta emails that some conspiracy connoisseurs cooked up into a tale of satanic child abuse revolving around a certain chi-chi Washington DC pizza joint. I never signed on with the story, but it was an interesting indication of how far the boundaries of mass psychology could be pushed in the mind wars of politics.

    Sex, of course, is fraught. Sex and the feelings it conjures beat a path straight to the limbic system where the most primitive thoughts become the father of the most primitive deeds. In our American world, this realm of thought and deed has turned into a political football with the Left and the Right scrimmaging ferociously for field position - while the real political agenda of everything important other than sex lies outside the stadium.

    The Comet Pizza story was understandably upsetting to Democrats who didn't like being painted as child molesters. Unfortunately for them, it coincided with the bust of one Anthony Weiner - and his infamous laptop - disgraced former "sexting" congressman, husband of Hillary's top aide and BFF, Huma Abedin. The laptop allegedly contained a lot of child porn.

    That garbage barge of sexual allegation and innuendo couldn't have helped the Hillary campaign, along with all the Clinton Foundation stuff, in the march to electoral loserdom. I suspect the chthonic darkness of it all generated the "Russia-did-it" hysteria that cluttered up the news-cloud during the first month of Trumptopia. The collective superego of America is reeling with shame and rage.

    On the Right side of the spectrum stood the curious figure of Milo Yiannopoulos, the self-styled "Dangerous Faggot," who has made a sensational career lately as an ideological provocateur, especially on the campus scene where he got so into the indignant faces of the Maoist snowflakes with his special brand of boundary-pushing that they resorted to disrupting his events, dis-inviting him at the last moment, or finally rioting, as in the case at UC Berkeley a few weeks ago.

    Milo's battles on campus were particularly ripe because his opponents on the far Left were themselves so adamant about their own brand of boundary-pushing along the frontier of the LGBTQ agenda. The last couple of years, you would've thought that half the student population fell into one of those "non-binary" sex categories, and it became the most urgent mission of the Left to secure bathroom rights and enforce new personal pronouns of address for the sexually ambiguous.

    But then Milo made a tactical error. Despite all the mutual boundary-pushing on each side, he pushed a boundary too far and entered the final dark circle of taboo: child molesting. That was the point were the closet Puritan hysterics went in for the kill. This is what he said on a Web talk radio show:

    What normally happens in schools, very often, is you have an older woman with a younger boy, and the boy is the predator in that situation. The boy is like, let's see if I can fuck the gym teacher, or let's see if I can fuck the hot math teacher, and he does. The women fall in love with these nubile young boys, these athletic young boys in their prime. We get hung up on the child abuse stuff to the point where we're heavily policing consenting adults, grad students and their professors, this arbitrary and oppressive idea of consent, which totally destroys the understanding many of us have about the complexities, subtleties, and complicated nature of many relationships. In the homosexual world particularly, some of the relationships between younger boys and older men, the sort of coming-of-age relationships in which these older men help those young boys discover who they are, and give them security and provide them with love . [Milo is shouted down by his podcast hosts]

    So that was the final straw. Milo got bounced by his platform, Breitbart News , and went through the now-routine, mandatory, abject ceremonial of the televised apology required by over-stepping celebrities - though he claimed, with some justification I think, that his remarks were misconstrued. Anyway, I'm sure he'll rebound on his own signature website platform and he'll be back in action before long.

    His remarks about the "coming-of-age" phase of life prompted me to wonder about the boundary-pushers on the Left, on the college campuses in particular, who are encouraging young people to go through drastic sex-change surgeries, at an age before the development of that portion of their frontal lobes controlling judgment is complete. Who are these diversity deans and LGBTQ counselors who lead confused adolescents to self-mutilation in search of some hypothesized "identity?" Whoever they are, this dynamic seems pretty reckless and probably tragic to me. There ought to be reasonable doubt that an irreversible "sexual reassignment" surgery may not lead to personal happiness some years down the line - when, for instance, that person's frontal lobes have developed, and they begin to experience profound and complicated emotions such as remorse.

    Our sexual hysteria has many more curious angles to it. We live in a culture where pornography, up to the last limits of freakishness and depravity, is available to young unformed personalities at a click. We stopped protecting adolescents against this years ago, so why should we be surprised when they venture into ever-darker frontiers of sexuality? It was the Left that sought to abolish boundaries in sex and many other areas of American life. And yet they still affect to be shocked by someone like Milo.

    I maintain that there is a dynamic relationship between our inability to act on the truly pressing issues of the day - energy, economy, and geo-politics - and our neurotic preoccupation with sexual identity. The epic amount of collective psychic energy being diverted from what's important into sexual fantasy, titillation, confusion, and litigation leaves us pathetically unprepared to face the much more serious crisis of civilization gathering before us.

    *

    Postscript : This item from The Stanford [University] Daily newspaper puts a nice gloss on the stupefying idiocy in the campus sex-and-identity debate. Single-occupancy Restrooms Convert to All-gender Facilities : "Single-occupancy restrooms on campus will soon all be converted to gender-neutral facilities due to new California legislature and ongoing administrative efforts. The Diversity and Access Office (D&A Office) has been spearheading the campaign to convert all single-occupancy restrooms ."

    Here's what I don't get: if a single-occupancy restroom is going to be used by one person at a time, what need is there to officially designate the sex of any person using it? And why are officials at an elite university wasting their time on this?

    1. routersurfer February 24, 2017 at 9:44 am # I agree totally this perverted national pastime of pin the genitalia on the mass of confused youth is a waste of time and energy. Anyone who reaches for the scalpel and plastic surgery before 25 has not been served well by the so called adults in their lives. Nature makes mistakes. Look at the Royals of Europe. But wait until the body is formed before the Medical Industrial Complex steps in. Now back to real problems. I heard on Bloomberg radio The Fed may offer 50 and 100 year T notes. Can someone explain how that fits into our system of accounting scams??

    [Feb 25, 2017] Most of the skill and experience has to be acquired on the job - into which graduates will not be hired

    Feb 25, 2017 | economistsview.typepad.com
    anne : February 25, 2017 at 05:23 AM

    http://cepr.net/blogs/beat-the-press/if-inadequate-skills-is-preventing-people-from-being-hired-in-manufacturing-it-s-among-the-ceos

    February 24, 2017

    If "Inadequate Skills" Is Preventing People from Being Hired in Manufacturing, It's Among the CEOs

    The Associated Press ran a story * that told readers:

    "Factory jobs exist, CEOs tell Trump. Skills don't."

    The piece presents complaints from a number of CEOs of manufacturing companies that they can't find the workers with the necessary skills. The piece does note the argument that the way to get more skilled workers is to offer higher pay, but then reports:

    "some data supports the CEOs' concerns about the shortage of qualified applicants. Government figures show there are 324,000 open factory jobs nationwide - triple the number in 2009, during the depths of the recession."

    The comparison to 2009 is not really indicative of anything, since this was a time when the economy was facing the worst downturn since the Great Depression and companies were rapidly shedding workers. A more serious comparison would be to 2007, before the recession. The job opening rate in manufacturing for the last three months has averaged 2.5 percent, roughly the same as in the first six months of 2007, which was still a period in which the sector was losing jobs.

    According to the Bureau of Labor Statistics, average hourly earnings of production and non-supervisory workers in manufacturing has risen by 2.4 percent over the last year. This means that manufacturing firms are not acting in a way consistent with employers having trouble finding workers. This suggests that if there is a skills shortage it is among CEOs who don't understand that the price of an item in short supply, in this case qualified manufacturing workers, is supposed to increase.

    * http://www.pbs.org/newshour/rundown/factory-jobs-exist-ceos-tell-trump-skills-dont/

    Peter K. -> anne... , February 25, 2017 at 08:23 AM
    See Tyler Cowen for the CEOs's sycophant.
    mrrunangun said in reply to anne... , February 25, 2017 at 01:51 PM
    Young people who have watched the stampede of manufacturing jobs out of the US may reasonably believe that they would be unwise to commit to developing any scarce skills currently needed in domestic manufacturing. Working in Illinois and Wisconsin, I know many skilled manufacturing technicians and engineers whose situations went from comfort to poverty in the space of a few years. Why would a young person today believe that manufacturing skills developed now will not be offshored the next time political winds shift? One of the reasons Trump got elected was by promising to protect the manufacturing jobs that are left, something that neither the Clintons, Bushes, nor Obama were willing to attempt.

    I believe Trump is wrong to try to wreck NAFTA, but PNTR for China has been a disaster for the US working class. This was initiated by Clinton and neither Bush nor Obama did anything to mitigate its effect on working people in the Midwest.

    cm -> mrrunangun... , February 25, 2017 at 03:57 PM
    Even without that aspect, most of the "skill" and experience has to be acquired on the job - into which they will not be hired.

    What most business managers are looking for is trained up people for whose training and hands-on skill somebody else has paid for. They don't want to be that "sucker" themselves.

    I suspect it is not purely selfishness (though poaching has always existed), but this mindset has evolved in the past decades where business could draw on a large overhang of sufficiently-skilled labor at home and globally. It was possible to dial down training and still find enough qualified workers. This is one of those things where the downward path is easier than upward. In parallel corporate pensions and unions were eliminated or reduced, both things that promote worker retention; and corporate/public rhetoric shifted to make it clear that you will only have your job as long as you are useful to the company, and maintaining that is up to you. Well, that's a two-way street.

    cm -> mrrunangun... , February 25, 2017 at 04:03 PM
    One possible solution to the training problem has been practiced in Germany - the government passes out training quotas or subsidies to companies; it is basically "either you train them or you pay a no-training 'fee' and we train them for you". Most large companies have training programs, but they often exceed their demand for new workers (or they can find qualified workers or temps elsewhere), and not everybody will be hired after graduating. That part such programs cannot address.
    anne -> cm... , February 25, 2017 at 04:14 PM
    One possible solution to the training problem has been practiced in Germany - the government passes out training quotas or subsidies to companies; it is basically "either you train them or you pay a no-training 'fee' and we train them for you"....

    [Feb 19, 2017] International science collaboration growing at astonishing rate: Cross-border studies more than doubled in 15 years

    Feb 19, 2017 | economistsview.typepad.com
    Peter K. : Reply Saturday, February 18, 2017 at 07:11 AM , February 18, 2017 at 07:11 AM
    https://www.eurekalert.org/pub_releases/2017-02/osu-isc021417.php

    PUBLIC RELEASE: 17-FEB-2017

    International science collaboration growing at astonishing rate: Cross-border studies more than doubled in 15 years

    OHIO STATE UNIVERSITY

    BOSTON - Even those who follow science may be surprised by how quickly international collaboration in scientific studies is growing, according to new research.

    The number of multiple-author scientific papers with collaborators from more than one country more than doubled from 1990 to 2015, from 10 to 25 percent, one study found. And 58 more countries participated in international research in 2015 than did so in 1990.

    "Those are astonishing numbers," said Caroline Wagner, associate professor in the John Glenn College of Public Affairs at The Ohio State University, who helped conduct these studies.

    "In the 20th century, we had national systems for conducting research. In this century, we increasingly have a global system."

    Wagner presented her research Feb. 17 in Boston at the annual meeting of the American Association for the Advancement of Science.

    Even though Wagner has studied international collaboration in science for years, the way it has grown so quickly and widely has surprised even her.

    One unexpected finding was that international collaboration has grown in all fields she has studied. One would expect more cooperation in fields like physics, where expensive equipment (think supercolliders) encourages support from many countries. But in mathematics?

    "You would think that researchers in math wouldn't have a need to collaborate internationally - but I found they do work together, and at an increasing rate," Wagner said.

    "The methods of doing research don't determine patterns of collaboration. No matter how scientists do their work, they are collaborating more across borders."

    In a study published online last month in the journal Scientometrics, Wagner and two co-authors (who are both from The Netherlands) examined the growth in international collaboration in six fields: astrophysics, mathematical logic, polymer science, seismology, soil science and virology.

    Their findings showed that all six specialties added between 18 and 60 new nations to the list of collaborating partners between 1990 and 2013. In two of those fields, the number of participating nations doubled or more.

    The researchers expected astrophysics would grow the most in collaboration, given the need to use expensive equipment. But it was soil science that grew the most, with a 550 percent increase in the links between research groups in different countries in that time period.

    "We certainly didn't expect to see soil science have the fastest growth," she said.

    "But we saw strong increases in all areas. It appears that all the fields of science that we studied are converging toward similar levels of international activity."

    The study found that virology had the highest rate of collaboration, with the most countries involved. "They aren't working together because they need to share expensive equipment. They're collaborating because issues like HIV/AIDS, Ebola and Zika are all international problems and they need to share information across borders to make progress."

    Wagner has started a new line of research that attempts to determine how much nations benefit from their scientific work with other countries. For this work, she is looking at all the scientific articles that a nation's scientists published with international collaborators in 2013. She is looking at each article's "impact factor" - a score that measures how much other scientists mentioned that study in their own work.

    "How much recognition a study gets from other scientists is a way to measure its importance," Wagner said.

    She compared each nation's combined impact factor for its international collaborations to how much money the same country spent on scientific research. This is a way to determine how much benefit in terms of impact each nation gets for the money it spends.

    The United States has the highest overall spending and shows proportional returns. However, smaller, scientifically advanced nations are far outperforming the United States in the relationship between spending and impact. Switzerland, the Netherlands and Finland outperform other countries in high-quality science compared to their investment. China is significantly underperforming its investment.

    Wagner said this isn't the only way to measure how a country is benefiting from international science collaboration. But it can be one way to determine how efficiently a country is using its science dollars.

    In any case, Wagner said her findings show that international science collaboration is becoming the way research gets done in nearly all scientific fields.

    "Science is a global enterprise now," Wagner said.

    Peter K. -> Peter K.... , February 18, 2017 at 07:24 AM
    This is the kind of globalization I endorse.

    Certain center-left Hillary fanboys like yuan, EMichael etc will point out that exit polls show how the poor voted for Hillary (as if that somehow proves that she's great for the poor. PGL would always point to how the poor blacks of the south were voting for Hillary in the primary.) Probably has something to do with the large populations of poor and working poor in metro areas. And Republicans aren't great for the poor.

    But exit polls said Hillary did much better with the educated. The more educated voted for her, the less educated voted for Trump.

    Also Hillary won the "high-output" counties, not the poor counties:

    "Last week, as my colleague Sifan Liu and I were gnawing on some questions asked by Jim Tankersley of The Washington Post, we happened upon a revealing aspect of the election outcome. While looking at number of influences on the presidential vote outcome, we found that in a year of massive divides, one particular economic split stands out.

    Our observation: The less-than-500 counties that Hillary Clinton carried nationwide encompassed a massive 64 percent of America's economic activity as measured by total output in 2015. By contrast, the more-than-2,600 counties that Donald Trump won generated just 36 percent of the country's output-just a little more than one-third of the nation's economic activity."

    https://www.brookings.edu/blog/the-avenue/2016/11/29/another-clinton-trump-divide-high-output-america-vs-low-output-america/

    The high-output and educated will continue with globalization thanks in part to the Internet and globalization while the religious and less-educated turn inwards and try to turn back the clock.

    We need fair trade and for globalization to mean shared prosperity and progress not corporate rule for the one percent.

    There needs to be an International of the Sanders supporters, and the supporters of Corbyn and Benoit Hamon.

    Those wallowing in the center-left need to decide whether they support barbarism or socialism. Which is the lesser evil?

    Peter K. -> Peter K.... , February 18, 2017 at 07:41 AM
    Hillary says we are not Denmark!

    [Feb 08, 2017] How Universities Are Increasingly Choosing Capitalism Over Education naked capitalism

    Notable quotes:
    "... By Henry Heller, a professor of history at the University of Manitoba, Canada and the author of The Capitalist University. Cross posted from Alternet ..."
    "... The following is an excerpt from the new book ..."
    "... by Henry Heller (Pluto Press, December 2016): ..."
    "... Inside Higher Education ..."
    "... The University, State and Market: The Political Economy of Globalization in the Americas ..."
    "... New Left Review ..."
    "... The Field of Cultural Production: Essays on Art and Literature ..."
    "... Letters from the Deutsch-Französische Jahrbücher ..."
    "... Anti-Communism in Twentieth-Century America ..."
    "... Marxism is still regarded with suspicion in the United States. ..."
    "... As if on cue, sociology, psychology, literature, political science, and anthropology all took sides by explicitly rejecting Marxism and putting forward viewpoints opposed to it. History itself stressed American exceptionalism, justified U.S. expansionism, minimized class conflict, and warned against revolution. ..."
    Feb 08, 2017 | www.nakedcapitalism.com
    How Universities Are Increasingly Choosing Capitalism Over Education Posted on February 7, 2017 by Yves Smith Yves here. Some further observations. First, the author neglects to mention the role of MBAs in the reorientation of higher education institutions. When I went to school, the administrative layer of universities was lean and not all that well paid. Those roles were typically inhabited by alumni who enjoyed the prestige and being able to hang around the campus. But t he growth of MBAs has meant they've all had to find jobs, and colonizing not-for-profits like universities has helped keep them off the street.

    Second, this post focuses on non-elite universities, but the same general pattern is in play, although the specific outcomes are different. Universities with large endowments are increasingly hedge funds with an educational unit attached.

    By Henry Heller, a professor of history at the University of Manitoba, Canada and the author of The Capitalist University. Cross posted from Alternet

    The following is an excerpt from the new book The Capitalist University: The Transformations of Higher Education in the United States since 1945 by Henry Heller (Pluto Press, December 2016):

    The fact that today there are over 4,000 colleges and universities in the United States represents an unparalleled educational, scientific, and cultural endowment. These institutions occupy a central place in American economic and cultural life. Certification from one of them is critical to the career hopes of most young people in the United States. The research produced in these establishments is likewise crucial to the economic and political future of the American state. Institutions of higher learning are of course of varying quality, with only 600 offering master's degrees and only 260 classified as research institutions. Of these only 87 account for the majority of the 56,000 doctoral degrees granted annually. Moreover, the number of really top-notch institutions based on the quality of their faculty and the size of their endowments is no more than 20 or 30. But still, the existence of thousands of universities and colleges offering humanistic, scientific, and vocational education, to say nothing of religious training, represents a considerable achievement. Moreover, the breakthroughs in research that have taken place during the last two generations in the humanities and social sciences, not to speak of the natural sciences, have been spectacular.

    But the future of these institutions is today imperiled. Except for a relatively few well-endowed universities, most are in serious financial difficulty. A notable reason for this has been the decline in public financial support for higher education since the 1980s, a decline due to a crisis in federal and state finances but also to the triumph of right-wing politics based on continuing austerity toward public institutions. The response of most colleges and universities has been to dramatically increase tuition fees, forcing students to take on heavy debt and putting into question access to higher education for young people from low- and middle-income families. This situation casts a shadow on the implicit post-war contract between families and the state which promised upward mobility for their children based on higher education. This impasse is but part of the general predicament of the majority of the American population, which has seen its income fall and its employment opportunities shrink since the Reagan era. These problems have intensified since the financial collapse of 2008 and the onset of depression or the start of a generalized capitalist crisis.

    Mounting student debt and fading job prospects are reflected in stagnating enrollments in higher education, intensifying the financial difficulties of universities and indeed exacerbating the overall economic malaise.[1] The growing cost of universities has led recently to the emergence of Massive Online Open Courses whose upfront costs to students are nil, which further puts into doubt the future of traditional colleges and universities. These so-called MOOCs, delivered via the internet, hold out the possibility, or embody the threat, of doing away with much of the expensive labor and fixed capital costs embodied in existing university campuses. Clearly the future of higher education hangs in the balance with important implications for both American politics and economic life.

    The deteriorating situation of the universities has its own internal logic as well. In response to the decline in funding, but also to the prevalence of neoliberal ideology, universities-or rather the presidents, administrators, and boards of trustees who control them-are increasingly moving away from their ostensible mission of serving the public good to that of becoming as far as possible like private enterprises. In doing so, most of the teachers in these universities are being reduced to the status of wage labor, and indeed precarious wage labor. The wages of the non-tenured faculty who now constitute the majority of teachers in higher education are low, they have no job security and receive few benefits. Although salaried and historically enjoying a certain autonomy, tenured faculty are losing the vestiges of their independence as well. Similarly, the influence of students in university affairs-a result of concessions made by administrators during the upheavals of the 1960s and 1970s-has effectively been neutered. These changes reflect a decisive shift of power toward university managers whose numbers and remuneration have expanded prodigiously. The objective of these bureaucrats is to transform universities as much as possible to approximate private and profit-making corporations, regarded as models of efficient organization based on the discipline of the market. Indeed, scores of universities, Phoenix University for example, have been created explicitly as for-profit businesses and currently enroll millions of students.

    Modern universities have always had a close relationship with private business, but whereas in the past faculty labor served capital by producing educated managers, highly skilled workers, and new knowledge as a largely free good, strenuous efforts are now underway to transform academic employment into directly productive, i.e., profitable, labor. The knowledge engendered by academic work is accordingly being privatized as a commodity through patenting, licensing, and copyrighting to the immediate benefit of universities and the private businesses to which universities are increasingly linked. Meanwhile, through the imposition of administrative standards laid down in accord with neoliberal principles, faculty are being subjected to unprecedented scrutiny through continuous quantified evaluation of teaching and research in which the ability to generate outside funding has become the ultimate measure of scholarly worth. At the same time, universities have become part of global ranking systems like the Shanghai Index or the Times Higher Education World University Rankings in which their standing in the hierarchy has become all important to their prestige and funding.

    Several intertwined questions emerge from this state of affairs. In the first place, given the rising expense and debt that attendance at university imposes and declining employment prospects especially for young people, will there continue to be a mass market for higher education? Is the model of the university or college traditionally centered on the humanities and the sciences with a commitment to the pursuit of truth compatible with the movement toward converting the universities into quasi- or fully private business corporations? Finally, what are the implications of changes in the neoliberal direction for the future production of objective knowledge, not to speak of critical understanding?

    Universities during the Cold War produced an impressive amount of new positive knowledge, not only in the sciences, engineering, and agriculture but also in the social sciences and humanities. In the case of the humanities and social sciences such knowledge, however real, was largely instrumental or tainted by ideological rationalizations. It was not sufficiently critical in the sense of getting to the root of the matter, especially on questions of social class or on the motives of American foreign policy. Too much of it was used to control and manipulate ordinary people within and without the United States in behalf of the American state and the maintenance of the capitalist order. There were scholars who continued to search for critical understanding even at the height of the Cold War, but they largely labored in obscurity. This state of affairs was disrupted in the 1960s with the sudden burgeoning of Marxist scholarship made possible by the upsurge of campus radicalism attendant on the anti-war, civil rights, and black liberation struggles. But the decline of radicalism in the 1970s saw the onset of postmodernism, neoliberalism, and the cultural turn. Postmodernism represented an unwarranted and untenable skepticism, while neoliberal economics was a crude and overstated scientism. The cultural turn deserves more respect, but whatever intellectual interest there may be in it there is little doubt that the net effect of all three was to delink the humanities and social sciences from the revolutionary politics that marked the 1960s. The ongoing presence in many universities of radicals who took refuge in academe under Nixon and Reagan ensured the survival of Marxist ideas if only in an academic guise. Be that as it may, the crisis in American society and the concomitant crisis of the universities has become extremely grave over the last decade. It is a central contention of this work that, as a result of the crisis, universities will likely prove to be a key location for ideological and class struggle, signaled already by the growing interest in unionization of faculty both tenured and non-tenured, the revival of Marxist scholarship, the Occupy Movement, the growing importance of the Boycott, Divestment, and Sanctions movement, and heightening conflicts over academic freedom and the corporatization of university governance.

    The approach of this work is to examine the recent history of American universities from the perspective of Marxism, a method which can be used to study these institutions critically as part of the capitalist economic and political system. Despite ongoing apologetics that view universities as sites for the pursuit of disinterested truth, we contend that a critical perspective involving an understanding of universities as institutions based on the contradictions of class inequality, the ultimate unity of the disciplines rooted in the master narrative of historical materialism, and a consciousness of history makes more sense as a method of analysis. All the more so, this mode of investigation is justified by the increasing and explicit promotion of academic capitalism by university managers trying to turn universities into for-profit corporations. In response to these policies scholars have in fact begun to move toward the reintegration of political economy with the study of higher education. This represents a turn away from the previous dominance in this field of postmodernism and cultural studies and, indeed, represents a break from the hegemonic outlook of neoliberalism.[2] On the other hand, most of this new scholarship is orientated toward studying the effects of neoliberalism on the contemporary university, whereas the present work takes a longer view. Marxist political economy demands a historical perspective in which the present condition of universities emerged from the crystallization of certain previous trends. It therefore looks at the evolution of the university from the beginning of the twentieth century, sketching its evolution from a preserve of the upper-middle class in which research played almost no role into a site of mass education and burgeoning research, and, by the 1960s, a vital element in the political economy of the United States.

    In contrast to their original commitment to independence with respect to the state up to World War II, most if by no means all universities and colleges defined their post-war goals in terms of the pursuit of the public good and were partially absorbed into the state apparatus by becoming financially dependent on government. But from start to finish twentieth-century higher education also had an intimate and ongoing relationship with private business. In the neoliberal period universities are taking this a step further, aspiring to turn themselves into quasi- or actual business corporations. But this represents the conclusion of a long-evolving process. The encroachment of private business into the university is in fact but part of the penetration of the state by private enterprise and the partial privatization of the state. On the surface this invasion of the public sphere by the market may appear beneficial to private business. We regard it, on the contrary, as a symptom of economic weakness and a weakening of civil society.

    The American system of higher education, with its prestigious private institutions, great public universities, private colleges and junior colleges, was a major achievement of a triumphant American republic. It provided the U.S. state with the intellectual, scientific, and technical means to strengthen significantly its post-1945 power. The current neoliberal phase reflects an America struggling economically and politically to adapt to the growing challenges to its global dominance and to the crisis of capitalism itself. The shift of universities toward the private corporate model is part of this struggle. Capitalism in its strongest periods not only separated the state from the private sector, it kept the private sector at arm's length from the state. The role of the state in ensuring a level playing field and providing support for the market was clearly understood. The current attempt by universities to mimic the private sector is a form of economic and ideological desperation on the part of short-sighted and opportunistic university administrators as well as politicians and businessmen. In our view, this aping of the private sector is misguided, full of contradictions, and ultimately vain if not disastrous. Indeed, it is a symptom of crisis and decline.

    The current overwhelming influence of private business on universities grew out of pre-existing tendencies. There is already an existing corporate nature of university governance both private and public, as well as an influence of business on universities in the first part of the twentieth century. In reaction there developed the concept of academic freedom as well as the establishment of the system of tenure and the development of a rather timid faculty trade unionism. This underscores the importance of private foundations in controlling the development of the curriculum and research in both the sciences and humanities. In their teaching, universities were mainly purveyors of the dominant capitalist ideology. Humanities and social science professors imparted mainly liberal ideology and taught laissez-faire economics which justified the political and economic status quo. The development of specialized departments reinforced the fragmentation of knowledge and discouraged the emergence of a systemic overview and critique of American culture and society. There were, as noted earlier, a few Marxist scholars, some of considerable distinction, who became prominent particularly in the wake of the Depression, the development of the influence of the Communist Party, and the brief period of Soviet-American cooperation during World War II. But the teaching of Marxism was frowned upon and attacked even prior to the Cold War.

    The post-1945 university was a creation of the Cold War. Its expansion, which sprang directly out of war, was based on the idea of education as a vehicle of social mobility, which was seen as an alternative to the equality and democracy promoted by the populism of the New Deal. Its elitist and technocratic style of governance was patterned after that of the large private corporation and the American federal state during the 1950s. Its enormously successful research programs were mainly underwritten by appropriations from the military and the CIA. The CIA itself was largely created by recruiting patriotic faculty from the universities. Much of the research in the social sciences was directed at fighting Soviet and revolutionary influence and advancing American imperialism abroad. Marxist professors and teaching programs were purged from the campuses.

    Dating from medieval times, the curriculum of the universities was based on a common set of subjects including language, philosophy, and natural science premised on the idea of a unitary truth. Although the subject matter changed over the centuries higher education continued to impart the hegemonic ideology of the times. Of course the notion of unitary truth was fraying at the seams by the beginning of the twentieth century with the development of departmental specialization and the increasingly contested nature of truth, especially in the social sciences in the face of growing class struggle in America. However, the notion of the idea of the unity of knowledge as purveyed by the university was still ideologically important as a rationale for the existence of universities. Moreover, as we shall demonstrate, it was remarkable how similarly, despite differences in subject matter and method, the main disciplines in the humanities and social sciences responded to the challenge of Marxism during the Cold War. They all developed paradigms which opposed or offered alternatives to Marxism while rationalizing continued loyalty to liberalism and capitalism. As if on cue, sociology, psychology, literature, political science, and anthropology all took sides by explicitly rejecting Marxism and putting forward viewpoints opposed to it. History itself stressed American exceptionalism, justified U.S. expansionism, minimized class conflict, and warned against revolution. Indeed, this work will focus on these disciplines because they defended the capitalist status quo at a deeper cultural and intellectual level than the ubiquitous mass media. As Louis Althusser pointed out, the teaching received by students from professors at universities was the strategic focal point for the ideological defense of the dominant class system. That was as true of the United States as it was of France, where institutions of higher learning trained those who would later train or manage labor. Criticizing the recent history of these disciplines is thus an indispensable step to developing an alternative knowledge and indeed culture that will help to undermine liberal capitalist hegemony.[3]

    The approach of this work is to critically analyze these core academic subjects from a perspective informed by Pierre Bourdieu and Karl Marx. Bourdieu points out that the deep involvement of the social sciences (and the humanities) with powerful social interests makes it difficult to free their study from ideological presuppositions and thereby achieve a truly socially and psychologically reflexive understanding.[4] But such reflexive knowledge was precisely what Marx had in mind more than a century earlier. Leaving a Germany still under the thrall of feudalism and absolutism for Paris in 1843, the young Marx wrote to his friend Arnold Ruge that

    reason has always existed, but not always in a reasonable form but, if constructing the future and settling everything for all times are not our affair, it is all the more clear what we have to accomplish at present: I am referring to ruthless criticism of all that exists, ruthless both in the sense of not being afraid of the results it arrives at and in the sense of being just as little afraid of conflict with the powers that be.[5]

    His task as he saw it was to criticize the existing body of knowledge so as to make it as reasonable as possible, i.e., to undermine its illusory and ideological character and substitute knowledge which was both true and helped advance communism. Such a project entailed deconstructing the existing body of knowledge through rational criticism, exposing its ideological foundations and advancing an alternative based on a sense of contradiction, social totality, and a historical and materialist understanding. It is our ambition in surveying and studying the humanities and social sciences in the period after 1945 to pursue our investigation in the same spirit. Indeed, it is our view that a self-reflexive approach to contemporary knowledge, while woefully lacking, is an indispensable complement to the development of a serious ideological critique of the crisis-ridden capitalist society of today.

    Marxism is still regarded with suspicion in the United States. As a matter of fact, anti-Marxism in American universities was not merely a defensive response to McCarthyism as some allege. Anti-communism was bred in the bone of many Americans and was one of the strongest forces that affected U.S. society in the twentieth century, including the faculty members of its universities. An idée fixe rather than an articulated ideology, it was compounded out of deeply embedded albeit parochial notions of Americanism, American exceptionalism and anti-radicalism.[6] The latter was rooted in the bitter resistance of the still large American middle or capitalist class to the industrial unrest which marked the late nineteenth and early twentieth centuries and which had a strong bed of support among the immigrant working class. Nativism then was an important tool in the hands of this class in fighting a militant if ethnically divided working class. Moreover, the anti-intellectual prejudices of American society in general and the provincialism of its universities were ideal terrain for fending off subversive ideas from abroad like Marxism. Later, this anti-communism and hostility to Marxism became the rationale for the extension of American imperialism overseas particularly after 1945. The social origins of the professoriate among the lower middle class, furthermore, and its role as indentured if indirect servants of capital, strengthened its position as inimical to Marxism. Just as careers could be lost for favoring Marxism, smart and adroit academics could make careers by advancing some new intellectual angle in the fight against Marxism. And this was not merely a passing feature of the height of the Cold War: from the 1980s onward, postmodernism, identity politics, and the cultural turn were invoked to disarm the revolutionary Marxist politics that had developed in the 1960s. Whatever possible role identity politics and culture might have in deepening an understanding of class their immediate effect was to undermine a sense of class and strengthen a sense of liberal social inclusiveness while stressing the cultural obstacles to the development of revolutionary class consciousness.

    This overall picture of conformity and repression was, however, offset by the remarkable upsurge of student radicalism that marked the 1960s, challenging the intellectual and social orthodoxies of the Cold War. In reaction to racism and political and social repression at home and the Vietnam War abroad, students rebelled against the oppressive character of university governance and by extension the power structure of American society. Overwhelmingly the ideology through which this revolt was refracted was the foreign and until then largely un-American doctrine of Marxism. Imported into the universities largely by students, Marxism then inspired a new generation of radical and groundbreaking scholarship. Meanwhile it is important to note that the student revolt itself was largely initiated by the southern civil rights movement, an important bastion of which were the historically black colleges of the South. It was from the struggle of racially oppressed black students in the American South as well as the growing understanding of the anti-colonial revolutionaries of Vietnam that the protest movement in American colleges and universities was born. Equally important was the Free Speech Movement at Berkeley. Indeed, it is the contention of this work that the issues raised at Berkeley over democracy in the universities and the free expression of ideas not only shaped the student movement of that time but are still with us, and indeed are central to the future of universities and intellectual life today.

    At the heart of the Berkeley protest lay a rejection of the idea of a university as a hierarchical corporation producing exchange values including the production of trained workers and ideas convertible into commodities. Instead the students asserted the vision of a democratic university which produced knowledge as a use value serving the common good. It is our view that this issue raised at Berkeley in the 1960s anticipated the class conflict that is increasingly coming to the fore over so-called knowledge capitalism. Both within the increasingly corporate neoliberal university and in business at large, the role of knowledge and knowledge workers is becoming a key point of class struggle. This is especially true on university campuses where the proletarianization of both teaching and research staff is in process and where the imposition of neoliberal work rules is increasingly experienced as tyrannical. The skilled work of these knowledge producers, the necessarily interconnected nature of their work, and the fundamentally contradictory notion of trying to privatize and commodify knowledge, have the potential to develop into a fundamental challenge to capitalism.

    Notes:

    1. Paul Fain, "'Nearing the Bottom': Inside Higher Education," Inside Higher Education , May 15, 2014.

    2. Raymond A. Morrow, "Critical Theory and Higher Education: Political Economy and the Cul-de-Sac of the Postmodernist Turn," in The University, State and Market: The Political Economy of Globalization in the Americas , ed. Robert A. Rhoads and Carlos Alberto Torres, Stanford: Stanford University Press, 2006, pp. xvii‒xxxiii.

    3. Perry Anderson, "Components of the National Culture," New Left Review , No. 50, July‒August, 1968, pp. 3–4.

    4. Pierre Bourdieu, The Field of Cultural Production: Essays on Art and Literature , New York: Columbia University Press, 1993, pp. 86–7.

    5. Karl Marx, Letter to Arnold Ruge, Kreuznach, September 1843, Letters from the Deutsch-Französische Jahrbücher , at https://www.marxists.org/archive/marx/works/1843/letters/43_09.htm

    6. Larry Ceplair, Anti-Communism in Twentieth-Century America , Santa Barbara: Clio, 2011, pp. 1–2, 12.

    0 0 30 1 1 This entry was posted in Banana republic , Free markets and their discontents , Guest Post , Politics , Social policy , Social values on February 7, 2017 by Yves Smith . Subscribe to Post Comments 31 comments Jim , February 7, 2017 at 1:57 am

    Capitalism requires that total strangers be on the hook for student loans? And if this is Capitalism then why didn't this trend emerge 100+ years ago? Why now?

    Trout Creek , February 7, 2017 at 3:18 pm

    It is a function of the adaption of NeoLiberalism as a governing principle which you can basically start around the time of Reagan.

    Steve Sewall , February 7, 2017 at 5:09 pm

    Because a) the market for a college degree is vastly bigger today than it was 100+ years ago b) tuitions were affordable so there was no way for high-interest lenders ("total strangers") to game the system as they do today.

    Plus I wonder if the legal system or tax code would have let them get away with anything like what they get away with today.

    schultzzz , February 7, 2017 at 1:58 am

    I agree with everything dude says, but the way he says it is so deathly dull and needlessly technical . . .

    it's a shame that someone so openly critical of the university system and culture nonetheless unquestioningly obeys the tradition of: "serious writing has to turn off 99% of the people that might be otherwise interested in the subject."

    Arizona Slim , February 7, 2017 at 8:57 am

    And here I thought I was the only one

    John Wright , February 7, 2017 at 9:59 am

    Yes, his writing caused this reader to do a MEDGO ("my eyes doth gloss over")

    It was technical in its assertions, but has few metrics to quantify the trends such as inflation adjusted administrative cost or inflation adjusted government college funding now vs then.

    There is a mention that the USA government has touted the "upward mobility" or excess value, AKA "consumer surplus", of a college degree to students and their families for years.

    The US government further encouraged the student loan industry with guarantees and bankruptcy relief de-facto prohibited.

    The current system may illustrate that colleges raised their prices to capture more of this alleged consumer surplus, a surplus that may no longer be there..

    If one looks at the USA's current political/economic/infrastructure condition, and asserts that the leaders and government officials of the USA were trained, overwhelmingly, over the last 40 years, in the USA's system of higher education, perhaps this is an indication USA higher education has not served the general public well for a long time.

    The author mentions this important point "These so-called MOOCs, delivered via the internet, hold out the possibility, or embody the threat, of doing away with much of the expensive labor and fixed capital costs embodied in existing university campuses. Clearly the future of higher education hangs in the balance with important implications for both American politics and economic life."

    Maybe the MOOCs are the low cost future as the 4 year degree loses economic value and the USA moves to a life-long continuous education model?

    Arizona Slim , February 7, 2017 at 11:06 am

    ISTR reading that the completion rate for MOOCs is pretty low. As in, 10% of the students who start the course end up finishing it.

    Pete , February 7, 2017 at 1:58 pm

    And that rate doesn't even mention what scores they achieved. MOOCs are hopeless especially since college is now less about getting an education and more about a statement about a young person's lifestyle or identity.

    http://akinokure.blogspot.com/2015/10/college-as-part-of-lifestyle.html

    JustAnObserver , February 7, 2017 at 2:18 pm

    Now sure about the `now' bit. I maybe a bit cynical but I've always thought, even when I was at one, that colleges/universities major function was as a middle-class finishing school for those unable to afford the real deal in Switzerland.

    julia , February 7, 2017 at 10:31 am

    I do not agree and it is deathly dull and needlessly technical. In fact it remains me off the marxistic education I enjoyed growing up in East Germany.
    Maybe it is time to rethink after school education. Physical Labor should loose its stain of being for loosers and stupid people. A whole lot of professions could be better taught through apprentiships and technical college mix.( many younge people would maybe enjoy being able to start qualified work after only 3 additional years of education).
    And do we really need 12 years of standard school education? There are so many kids that do not function well in school.
    Universities should be for the really eager and talented who want to spend a big part of
    their youth learning.
    I guess we need a lot of new ideas to get away from the old paradigma ( anti- marxist or marxist)

    John Wright , February 7, 2017 at 4:00 pm

    I took a couple of classes at the local junior college in automotive smog testing and machining.

    One of the instructors told me the JC administration viewed this Junior College as having two parts, College Prep + vocational education.

    He suggested the administration looked down on the vocational education portion, saying "But we get the jobs".

    Steve , February 7, 2017 at 4:17 pm

    I don't know how you read other works from academics if you think that this was dull.

    Do you or anyone thinking this was "dull" have any examples of academic essays or books that contain useful knowledge but also consider them "shiny?"

    Personally, I thought this was a very good essay as it explains some things I've been thinking about American higher education and quite a few things about my personal university education at a tier-1 research school.

    Altandmain , February 7, 2017 at 2:10 am

    Basically universities have become a cog in the machine of neoliberalism.

    Rather than anything resembling an institution for the public good, it has taken on the worst aspects of corporate America (and Canada). You can see this in the way they push now for endowment money, the highly paid senior management contrasted with poorly paid adjuncts, and how research is controlled these days. Blue skies research is cut, while most research is geared towards short-term corporate profit, from which they will no doubt milk society with.

    I tremble when I think about what all of this means:
    1. Students won't be getting a good education when they are taught by adjuncts being paid poverty wages.
    2. Corporations will profit in the short run.
    3. The wealthy and corporations due to endowment money have a huge sway.
    4. Blue skies research will fall and over time, US leadership in hard sciences.
    5. The productivity of future workers will be suppressed and with it, their earning potential.
    6. Related to that, inequality will increase dramatically as universities worsen the situation.
    7. There will be many "left behind" students and graduates with high debt, along with bleak job prospects.
    8. State governments, starving for tax money will make further cuts, worsening these trends.
    9. Anything hostile to the corporate state (as the article notes) will be suppressed.
    10. With it, academic freedom and ultimately democracy will be much reduced.

    What it means is decline in US technological power, productivity gains, and with it, declining living standards.

    All of these trends already are happening. They will worsen.

    I'd agree that a more readable version of this should be made for the general public.

    James McFadden , February 7, 2017 at 1:23 pm

    Well said.

    But your description suggests an inevitable bleak dystopic future – a self-fulfilling prophesy. The future is not written – we can help determine its course. It starts with grass roots movement building in your neighborhood and community. And I can't think of a more rewarding task then creating a better future for our children.

    But perhaps my farmer's work ethic, my inclination to side with the underdog and stand up to the bully capitalists, are notions that most Americans no longer possess. Perhaps Cornel West is correct when he states: "The oppressive effect of the prevailing market moralities leads to a form of sleepwalking from womb to tomb, with the majority of citizens content to focus on private careers and be distracted with stimulating amusements. They have given up any real hope of shaping the collective destiny of the nation. Sour cynicism, political apathy, and cultural escapism become the pervasive options."

    However, it is my observation that Trump's election has woken this sleepwalking giant, and that his bizarre behavior continues to energize people to resist. So why not rebel and help bring down the neoliberal fascists. Is there any cause more worthy? And for those who won't try because they don't think they can win, consider the words of Chris Hedges: "I do not fight fascists because I will win. I fight fascists because they are fascists."

    Jason , February 7, 2017 at 2:14 am

    I'm going to complain about your headline. A lot of stuff on this blog is obviously relevant only to the USA, and when it's obvious it doesn't need to be mentioned in the headline. But it's not at all obvious that this topic is only about the USA (or North America, since the author is in Canada?), so maybe you could edit the headline to reflect that it is in fact only about the USA?

    My observation of Australian universities is that they have similar problems, although maybe to a lesser extent. But I doubt the same things happen in all countries. I'd be interested to know more about mainland European universities, and ex-Soviet-bloc universities, and Chinese universities, and Third World universities.

    As for "Universities with large endowments are increasingly hedge funds with an educational unit attached", I think the rich universities in the UK (i.e. the richer residential Oxbridge colleges, if you count them as universities – Oxford and Cambridge Universities themselves are not particularly rich – plus maybe Imperial College?) have very little invested in hedge funds and a lot in property. Can anyone confirm or deny that?

    Colonel Smithers , February 7, 2017 at 4:30 am

    Thank you, Jason.

    In the past two decades, the UK's top universities, often called the Russell Group after the Russell Hotel in Russell Square where they met to form a sort of lobby group, have made money and started hiring rock star academics. I don't know how much these academics teach, but they often pontificate in the media.

    Big business, oligarchs and former alumni (often oligarchs) donate money, allowing them to build up their coffers. Imperial is developing an area of west London.

    Oxbridge colleges own a lot of property. Much of the land between Cambridge and London is owned by Cambridge colleges. This goes back to when they were religious institutions and despite Henry VIII's dissolution of the monasteries.

    London Business School has expanded from its Regent's Park base to Marylebone as the number of students, especially from Asia, grow. I have spoken to students from there and Oxford's Said Business School and know people who have guest lectured there. They were not impressed. Plutonium Kun has written about that below.

    Colonel Smithers , February 7, 2017 at 4:38 am

    Correction: number of students grows :-)

    bmeisen , February 7, 2017 at 12:35 pm

    Oxford and Cambridge are British state universities as I understand it. The Russell Group consists primarily of state institutions that have assumed / been given / been restored to an elite role in the British system of higher education, which is overwhelmingly public. Oxford and Cambridge are at the peak of a relatively flat hierarchy of elite public higher education. Higher ed's role in the constitution of British elites is characterized by 3 features: association with an institutional reputation and thereby access to a network, a financial hurdle, and a meritocratic process of selection. Of these the financial hurdle is the least problematic – tuition is still peanuts compared to that at American elite institutions.

    Things have gotten better – you no longer have to be a male member of the church of England to get in – and the system is more democratic than the French system of elite public higher ed, i.e. the ruling elite in the UK can be penetrated by working people, e.g. Corbyn.

    Winston Smith , February 7, 2017 at 3:07 am

    My son is half Japanese and half American and holds a passport with both countries, he is still in elementary school, but my wife and I are encouraging him to go to school in Japan or to Germany (ancestral home) and seek his fortunes outside of the US as the crapification of the US roller coasters out of control.

    Japanese universities are still affordable compared to the US and it's administrative layer, modestly paid, isn't run by MBAs, corporate hacks and neoliberal apologists and others who would better serve the public by decorating a lamp post somewhere with piano wire tightly wrapped around their necks!

    My niece attended Kyoto University, one of the best schools in Japan and it cost her and her parents about 7500.00 a year. She commuted from Nara City and Finished her degree in just under three years and had a job waiting for her in the middle of her third year.

    Now, I agree that Japanese universities have their fare share of problems and insanity, but the thought of dealing with US universities nauseates my wife and me.

    The only school in the US that I would want my son to attend would be Caltech, if he could ever successfully get accepted. They still do great science there, much of it blue sky research. LIGO is still running!
    https://eands.caltech.edu/random-walk-3/

    * disclaimer, I used to be a Caltech employee.

    Colonel Smithers , February 7, 2017 at 4:35 am

    An increasing number of British students are going to the Netherlands and, to a lesser extent, Germany for courses taught in English and for under EUR2000 per annum. Leiden and Maastricht are particularly favoured. Apparently, some Spanish universities are cottoning on to that market.

    Half a dozen years ago, a clown masquerading as a BBC breakfast news reporter went to have a look and condescend. Her concluding remark was, "The question is are continental universities as good as British ones."

    Arizona Slim , February 7, 2017 at 9:00 am

    I have studied at a Spanish university. The courses were excellent.

    Jake , February 7, 2017 at 8:04 am

    But but Japan has sooooo much government debt and must cut cut cut unless it implodes!

    Out of curiosity, may I ask you to elaborate on what you mean when you say japanese universities have 'their fare share of problems and insanity'?

    schultzzz , February 7, 2017 at 2:40 pm

    re: japanese universities.

    The university system is not set up for education. it's a reward to the conformists who studied 12 hours a day all through jr high/highschool to pass the university entrance exams (which notoriously don't test for any useful knowledge). The idea being that if you waste your whole childhood studying for a phoney test, you won't dare question the system once you're in the workforce, as it would mean admitting your whole childhood was wasted!

    Since college is viewed as a reward, rather than a challenge, there's very little learning going on. it's about developing relationships (and drinking problems) with future members of this elite class.

    So most Japanese corporations wind up having to teach the grads everything on the job anyway.

    A Japanese degree doesn't mean 'i know things' it means 'i have already by age 20 sacrificed so much that i don't dare ever rock the boat', which is exactly how the corporations and govt bureaucracies want it.

    You might say "oh but science! Japanese are good at that!"

    But my wife, a nurse, says that it's considered rude to flunk an incompetent student, providing she/he's respectful of the professor. There are doctors who routinely botch surgeries, but firing them would be rude. These doctors would have flunked out of regular (i.e. non-Japanese) universities.

    End rant!

    PlutoniumKun , February 7, 2017 at 3:55 am

    Having on more than one occasion suffered through management restructuring organised by MBA's which did nothing other than reduce productivity in favour of meaningless metrics and increase the power of managers who had no idea how to actually do the job, I'm increasingly coming to the conclusion that the MBA was a clever invention by an anarchist determined to create a virus to undermine capitalism from within. At least, thats the only possible theory that makes sense to me.

    templar555510 , February 7, 2017 at 2:20 pm

    I agree . Putting it more bluntly the MBA is a clever con to get would-be students to sign up in the belief it'll teach them something that can't be taught – how to make money. I've said this on this blog before – the ability to make money is a knack ; it doesn't matter what the field is it's all akin to someone selling cheap goods on a market stall .

    Colonel Smithers , February 7, 2017 at 4:19 am

    Thank you, Yves, for posting.

    Some observations from the UK:

    Many UK universities are targeting foreign, especially Asian, students for the purpose of profit, not education. Some universities refer to students as clients.

    Some provincial universities are opening campuses in London as foreign students only want to study in London.

    There are many Chinese would be students in London this week. Some universities have open days at the moment. When the youngsters and their parents are not attending such days, they go shopping at Bicester Village, just north of Oxford. It's odd to see commuters arriving from Buckinghamshire at Marylebone for work and Chinese and Arab tourists going shopping in the opposite direction, and the reverse in the evening.

    The targeting of rich Asian students, often not up to academic standard, has led to a secondary school in mid-Buckinghamshire, where selective education prevails at secondary / high school, to take Chinese students for the summer term and house them with well to do (only) local parents. The experiment went well for the "grammar" school, i.e. it made money. As for the families who housed the kids, not so much. There were complaints that the children could speak little or no English, which is not what they expected, so the host families could barely interact with the visitors. The school wants to repeat the programme and expand it to a full year. That is the thin end of a wedge as the school will scale back the numbers of local children admitted and probably expand the programme to the entire phase of secondary / high school. It's like running a boarding school by stealth. The school is now an "academy", so no longer under government control and similar to charter schools, and can do what it wants.

    David Barrera , February 7, 2017 at 6:20 am

    Yves Smith,
    I like your introduction to the article. "Universities with large endowments are increasingly hedge funds with an educational unit attached" A recent and very simple but eye opener interview on the subject-Richard Wolff-http://www.rdwolff.com/rttv_boom_bust_for_profit_schools_are_making_money_but_failing_the_grade

    As Henry Heller mentions Bourdieu, I can not find among his bibliography much on the specific increasing dominance of the "free market" over learning institutions. The Field of Cultural Production focuses mainly on the opposition market/art,cultural field and the rules of art. Some of his other works elaborate very well on the transformed reproduction of social agents with different economic and cultural capital weights. His major works on higher learning are The State Nobility and Academic Discourse, which are about the homologies between the hierarchy of higher learning centers and the market position occupiers which the latter produce. All of it within the French context. The great late Bourdieu certainly denounced the increasing free market ideology presence and dominance on "everything human"(i.e Free Exchange, Against the Tyranny of the Market and elsewhere); yet not much in that regard-to my knowledge-on the centers with the granted power to issue higher learning degrees. I guess my point is that Heller's reference to Bourdieu strikes me as a bit odd here.
    Nevertheless, I like Heller's article. Just as incidental evidence: my town's community college President is a CPA and MBA title holder, the Economics 101 class taught does not deviate the slightest from economic orthodoxy doctrine and I must add that, despite-or because of- a 75% tutoring fee increase in the last eight years, the center has consistently generated a surplus aided by the low wages from the vastly non-tenured teachers.

    Colonel Smithers , February 7, 2017 at 6:38 am

    The students from China, Singapore and the Middle East often live in the upscale areas of London, often at home rather than rent. Parents are often in tow. They also drive big and expensive cars.

    It's amazing to see what is driven and by whom around University, Imperial and King's colleges and the London School of Economics in central London. This was remarked upon by US readers a couple of years ago. Parking is not cheap, either.

    A friend and former colleague was planning to rent at Canary Wharf where he was a contractor. He put his name down and was getting ready to move in. The landlord got in touch to say sorry, a family from Singapore was coming and paying more. Apparently, Singaporeans reserve well in advance, even before the students know their exam results.

    A golf course was put up for sale near home. The local authority tipped off some upscale estate agents / realtors from London. A Chinese buyer has acquired the thirty odd acre property. Without planning (construction) permission, the property is worth £1.5m. With planning permission, it's worth £1m per acre. A gated community / rural retreat for the Chinese student community is planned. Oxford, London, Shakespeare Country, Clooney Country and Heathrow are an hour or less away.

    Left in Wisconsin , February 7, 2017 at 10:45 am

    My favorite line:
    Marxism is still regarded with suspicion in the United States.

    I love a good Marxist and I know that a totalizing perspective such as Marxism requires a certain amount of generalization, but I found more to criticize in this post than to recommend it. Apparently entire disciplines have agency ( As if on cue, sociology, psychology, literature, political science, and anthropology all took sides by explicitly rejecting Marxism and putting forward viewpoints opposed to it. History itself stressed American exceptionalism, justified U.S. expansionism, minimized class conflict, and warned against revolution. ).

    It is clearly true that the modern university is overly focused on money-making – both the university enterprise itself and the selling of higher ed to students – but, from my long experience with one big Tier One and lesser knowledge of several others, it is wrong to say that the modern university looks to operate as a business. Indeed, the top heaviness of bureaucratic administration in the modern university is not very business-like.

    IMO what declining public funding has done is allow/force the modern university to aim it's giant vacuum sucker in any and every direction. By the way, if Wisconsin is any example, there are enough Chinese students interested in American university degrees to keep it in business for quite a long time.

    But my biggest complaint is with the history. After first laying out an ideal (but not very) historical vision of the utopian university, in contrast with today's money grubber, he later admits that the mid-century university was not all that open to leftism. Then the miracle of the 1960s, which seems to spring from social protest alone. The real story of the 1960s was the huge expansion of higher ed in the U.S., which led to considerable faculty hiring, which allowed a lot of leftists to get hired in the 1960s and early 1970s (often at second or third-tier schools) when they would not have in the 1950s. This was always going to be a one-time event.

    The author also seems to suggest that universities owe it to Marxists to hire them if their analysis is good. This is a weird argument for a Marxist to make, seemingly entirely oblivious to the overall political economy he otherwise emphasizes. It ends up sounding more than a bit self-serving. I'm not sure lecturing in History on the public dime is Marx's idea of praxis.

    cojo , February 7, 2017 at 11:52 am

    The same can be said about administrative costs in medicine. Seems the parasitic infection is everywhere!

    [Jan 29, 2017] Not all authors are able to afford MS Word and the equipment. So using open source publishing system is the most proper for academic publishing

    Notable quotes:
    "... It is not just a matter of the author being able to afford Word and the equipment and other software to use it productively. E.g. how do you prepare your graphs and images? Also business partners accepting or returning the documents will have to buy into the "ecosystem". ..."
    "... Academia is a highly collaborative venture, and one has to consider overall cost and productivity. ..."
    "... Today there is PDF as a pretty established (readonly) document format, back in the day the standard in academia was Postscript. ..."
    "... I used Word when writing my thesis in '94-95 - each chapter a separate doc, figures inserted by creating artwork separately and then using a high-end copy machine to integrate text and figures. It was an ugly process. ..."
    Jan 29, 2017 | economistsview.typepad.com
    cm -> Chris G ... Sunday, January 29, 2017 at 12:21 AM , January 29, 2017 at 12:21 AM
    The comparison comes 20 years late. In the 90's, MS Word was unsuitable for academic and scientific writing, period. Even for short documents like a conference or term paper. It was geared entirely to corporate users. In addition it was riddled with bugs and layout "quirks".

    In reality, you also have to fiddle with Latex, and in the 90's embedding images was big PITA.

    What I did not see in the comparison is price. I suppose one would need to compare legally-owned copies of one product vs. the other.

    It is not just a matter of the author being able to afford Word and the equipment and other software to use it productively. E.g. how do you prepare your graphs and images? Also business partners accepting or returning the documents will have to buy into the "ecosystem".

    Academia is a highly collaborative venture, and one has to consider overall cost and productivity.

    Today there is PDF as a pretty established (readonly) document format, back in the day the standard in academia was Postscript.

    Chris G -> cm... , January 29, 2017 at 06:35 AM
    >In the 90's, MS Word was unsuitable for academic and scientific writing, period... It is not just a matter of the author being able to afford Word and the equipment and other software to use it productively. E.g. how do you prepare your graphs and images?

    I used Word when writing my thesis in '94-95 - each chapter a separate doc, figures inserted by creating artwork separately and then using a high-end copy machine to integrate text and figures. It was an ugly process.

    > Also business partners accepting or returning the documents will have to buy into the "ecosystem".

    That's what led my employer to switch from WordPerfect to MS Word and from Lotus 1-2-3 to Excel in the late '90s. Our customer, the US Govt, imposed a requirement that all reports and supplementary material, e.g., presentations and spreadsheets, be submitted in MS Office formats.

    > What I did not see in the comparison is price. I suppose one would need to compare legally-owned copies of one product vs. the other.

    Figure the business owns legal copies. Purchase price is one consideration, another is the cost to maintain the software and keep staff trained in how to use it. The inertia - the tendency to stick with what you've got - can be huge when taking the latter factors into account. In an academic research group not only is there a mentality that you want to use the best available tool for the job but there's constant turnover, which supports rapid adaptation and evolution. Inertia is low. In contrast, turnover in (non-startup) business environments is comparatively slow. Those businesses make cost-benefit assessments of adopting new software. The tendency is to stick with what you've got until it's absolutely positively unsustainable to do so.

    [Jan 28, 2017] Ms Word vs LaTeX

    Jan 28, 2017 | economistsview.typepad.com
    Chris G : January 28, 2017 at 06:04 AM

    Re LaTeX reduces writing productivity - The .Plan

    1. My experience with LaTeX vs Word is consistent with the study results - "We show that LaTeX users were slower than Word users, wrote less text in the same amount of time, and produced more typesetting, orthographical, grammatical, and formatting errors."

    2. There's a guy in my group, the most talented applied mathematician I've ever known -incredibly good at applying high level math to solve practical problems, who swears by LaTeX even though we're standardized on Word at work. He's not any faster in preparing his docs than the rest of us and they're not any better in terms of look and feel. He just prefers to use LaTeX. Getting him to use Word has been like pulling teeth, i.e., entirely consistent with "On most measures, expert LaTeX users performed even worse than novice Word users. LaTeX users, however, more often report enjoying using their respective software." I will send him a link to the PLOS ONE article first thing Monday morning;-)

    pgl -> Chris G ... , January 28, 2017 at 10:46 AM
    WordPerfect works better than either.
    libezkova -> Chris G ... , January 28, 2017 at 03:05 PM

    "My experience with LaTeX vs. Word is consistent with the study results - "We show that LaTeX users were slower than Word users, wrote less text in the same amount of time, and produced more typesetting, orthographical, grammatical, and formatting errors."

    You are wrong.

    Such a statement signifies complete lack of understand of what the writing a book or dissertation is about. And what problems the author faces and need to solve in the process (this is pretty hard and time consuming job to write a sizable book - your book is a very harsh mistress ;-)

    MS Word and TeX represent two different categories of writer's tool: the former is the tool without direct access to raw representation of the document/book. The latter is a tool with full access to such a representation. In this sense you can't and should not even compare them, unless you want to looks like an incompetent.

    Moreover on long documents (to say nothing about books) latest versions of MS Word all have strange quirks. Sometime it change your formatting in a undesirable way. Microsoft software quality really went downhill after, say, 2003.

    Fixing those quirks including "spontaneous" changes in formatting can take a day or a week of work even if you know MS Word perfectly well (which, unsurprisingly, very few people outside programming community do), including the in-depth knowledge of styles and, especially, macro programming. The latter is a must for writing any sizable book in MS Word. Or you need a good programmer to help you.

    Of course, if you expect that your book will be a bestseller you can hire a top level programmer to adapt set of tools/macros for you, but that's a lot of money. You need approximately 3-5K lines of macros to supplement MS Word for writing a sizable book (say, over 300 pages).

    I do know a couple of authors who write their technical books using MS Word (Bruce Eckel the author of "Thinking in Java" is one example). I view them as perverts, although being a programmer is a distinct advantage in such a situation; you will need all your skills to make the job done and you do not need to pay somebody else for such a help ;-).

    Writing a large book is about managing revisions and a very precise formatting of chapters. Which needs to be preserved (and verified with some automatic tools) over many iterations (which can take several years) until the final draft of the book. Manipulating the set of styles you use in the book is not easy in MS Word.

    Here access to the raw representation of the text of the book is vital. If you need to check your examples (like in case of writing programming books), access to raw text is a must (although can be imitated in MS Word via macros). If you are writing geo science or any book with a lot of mathematics – you better forget about MS Word.

    The usual trick authors who write books in MS Word use -- storing each chapter as a separate document -- makes it difficult to create cross references and such. Chapters became semi-isolated and that negatively affects the quality of the book.

    So for technical books and especially dissertations TeX has a huge (and I mean HUGE) edge over MS Word. Only using HTML with styles (FrontPage 2003 or Microsoft expression Web) can compete with TeX and only in case you do not use mathematical notation and equations extensively.

    brian : , January 28, 2017 at 10:16 AM
    Re latex

    OK. word is faster. However there's nothing there about what the document looks like. Word documents look like word documents, i.e. not very good. Perhaps that's a function of somebody knowledgeable setting up templates. I find it really hard to believe that it's that much faster. I find word completely bewildering.

    People like latex it better because they can use their favorite text editor and get it done. using word is completely and utterly annoying. That accounts for the enjoyment factor i think.

    Also too, no mention of lyx.

    libezkova -> Chris G ... , January 28, 2017 at 05:59 PM
    I respectfully disagree, but I see your point -- MS Word is much simpler to use for short papers, especially in multi-author env. It requires less sophistication on users part.

    Please understand that for LaTeX to work in multi-author environment you need Git or Subversion (or similar version management system) to be installed and learned by all people in the group. Even when just two people are involved (as often is the case with dissertations ) this is a must.

    But from the point of view of achievable final quality of the product WordPerfect is better as PGL pointed out.

    Both are (unlike TeX) integrated WYSIWYG ("what you see is what you get") publishing environments with a lot of sophisticated features (such as folding, macros, styles, creation of TOC, powerful spellchecker, etc).

    WordPerfect still is used by lawyers and some other professions who value precise layout:

    http://www.microcounsel.com/nextgen.htm

    == quote ==
    Why do lawyers still love WordPerfect? One attorney answers with "Two words: Reveal Codes. At one point about 10 years ago, I tried switching to Word. My secretary and I agreed we hated it after only a few weeks."
    == end of quote ==

    I am surprised that so few people in the USA use Microsoft Expression Web (or FrontPage ) for this purpose in corporate env.

    I am also surprised how Microsoft being a huge company still managed to produce very complex, professional tools like Ms Word and managed to push them to people who are definitely unable to use even 10% of the features offered.

    Few people understand that MS Word takes years of day-to-day usage (plus some programming abilities) to learn on the expert level. In reality this is a complex publishing system.

    I know some secretaries with almost 30 years day-to-day experience (starting PC DOS days with MS Word 4, which was released in 1987) who still learn something new each month. Often because they knew it a couple of years ago, but forgot :-).

    BTW MS Word is one of the few applications for which viruses ("macro viruses") exist and were a nasty problem in the corporate environment in 1996-2002.

    Bill Gates took huge risk to bring "over-sophisticated" products like this to the market and still managed to achieve a dominant position among regular users. In Bill Gates days Microsoft was a "king of software complexity" in this product niche.

    supersaurus : , January 28, 2017 at 03:26 PM
    LaTeX vs MSWord? really? someone got paid to do research on that topic? what next? emacs vs vim?
    Observer -> supersaurus... , January 28, 2017 at 04:00 PM
    Kind of brings you back, doesn't it. I seem to recall a guy in the lab running LateX on a PDP 11/70 back in the early 80's - rather a boutique affectation even then.
    libezkova -> Observer... , -1
    TeX is a standard typesetting tool for the American Mathematical Society.

    http://www.ams.org/publications/authors/authors
    == quote ==
    Many mathematics publishers (including the AMS) strongly encourage the use of LaTeX:

    • Learn Why Mathematics Publishers Support the Use of LaTeX
    • Download AMS LaTeX Version 2

    [Jan 25, 2017] Neoliberalism, computer revolution and tranformation of university education

    Notable quotes:
    "... Another quibble, the defining of inequality by the single metric of share of income of the 1% is a bit reductive, though only a bit. ..."
    "... Sometimes I think that the success of neoliberalism would be impossible without computer revolution. ..."
    "... Bargaining power was squashed by neoliberalism by design. So this is not a "natural" development, but an "evil plot" of financial oligarchy, so to speak. In this sense dissolution of the USSR was a huge hit for the US trade unions. ..."
    "... Education is now used as the filter for many jobs. So people start to invest in it to get a pass, so to speak. With the neoliberal transformation of universities it now often takes pervert forms such as "diploma mills" or mass production of "Public relations" graduates. ..."
    "... Neoliberal transformation of universities into profit centers also played the role in increasing the volume -- they need "customers" much like McDonalds and use misleading advertisements, no entrance exams, and other tricks to lure people in. ..."
    Jan 25, 2017 | economistsview.typepad.com
    sanjait : Wednesday, January 25, 2017 at 11:31 AM
    This is tremendous.

    If the world were sane, this is the kind of thinking that would be taking place about inequality. Rather than jumping to simple conclusions based on heavy priors (which is where too much of the "debate" starts and stops), one starts with a broad, open minded and contemplative review that seeks to identify primary causal factors.

    That said ... there is a lot that could be quibbled here.

    One, it's not always the case that identifying primary causes leads one directly to solutions. Sometimes the solution has little to do with the cause. If, for example, changing climate causes an increase in forest fires, we should consider that as another factor in our evaluation of climate economics, but in terms of strategies for addressing forest fires, we have to find proximate solutions.

    Although in practice, certainly we will often have a better understanding of what solutions might be possible and might be effective when we carefully analyze causes. The endeavor of identifying causes is absolutely worthwhile for that reason.

    Another quibble, the defining of inequality by the single metric of share of income of the 1% is a bit reductive, though only a bit.

    Last note ... I notice international trade is not mentioned here. That doesn't mean it isn't a primary driver, although as I've said many times, I don't think it is a primary driver, and it appears Kenworthy didn't think it even worth mentioning.

    sanjait -> sanjait... , January 25, 2017 at 11:41 AM

    Although my biggest quibble is that I think Kenworthy missed the big cause entirely: the effect technology has had in making workers fungible.

    IT has made communications almost free and made micromanagement of business systems ubiquitous. As a result, firms are no longer dependent on long-tenured workers, or even teams of workers in a particular place. Anything and anyone can be replaced and outsourced (in the broadest sense of the term, not just offshoring to foreign workers), and when costs are high companies do this aggressively.

    This change has immeasurably changed the nature of work and the relative bargaining powers of individual workers and even teams of workers. That, I believe, is why education is rising, and doing so in the countries that are most adept and aggressive about business process solutions implementation across many sectors. If I'm right, we will see this trend accelerate very soon in countries that are laggards in this domain, as they finally start operating as resource planned enterprises.

    Because this effect is not measured and difficult to measure ... I think it gets overlooked. But if I were a researcher in this field, I'd be looking at ERP adoption trends vs within firm inequality trends and looking for correlations. This would get confounded by firm size but I bet there are ways to tease out the effect.

    sanjait -> sanjait... , January 25, 2017 at 11:42 AM
    "why education is rising" supposed to say "why INEQUALITY is rising" ...
    libezkova -> sanjait... , January 25, 2017 at 06:44 PM
    Sanjait,

    "the effect technology has had in making workers fungible."

    Yes, this is a very good point. Especially computer revolution and related revolution in telecommunications. Starting from "PC revolution" (August 12, 1981) the pace of technological innovation was really breathtaking. Especially in hardware.

    Regular smartphone now is more powerful then a mainframe computer of 1971 which would occupy a large room with air conditioning (IBM 360/370 series). So say nothing about early 1960th ("Desk Set" movie with Katharine Hepburn, which was probably the first about displacement of workers by computers, was produced in 1957)

    "This change has immeasurably changed the nature of work and the relative bargaining powers of individual workers and even teams of workers. That, I believe, is why education is rising..."

    The nature of work in "classic" human fields (agriculture, steel industry, electrical generation, law, etc) was not changed dramatically but the "superstructure" above them did.

    Sometimes I think that the success of neoliberalism would be impossible without computer revolution.

    Bargaining power was squashed by neoliberalism by design. So this is not a "natural" development, but an "evil plot" of financial oligarchy, so to speak. In this sense dissolution of the USSR was a huge hit for the US trade unions.

    Education is now used as the filter for many jobs. So people start to invest in it to get a pass, so to speak. With the neoliberal transformation of universities it now often takes pervert forms such as "diploma mills" or mass production of "Public relations" graduates.

    Neoliberal transformation of universities into profit centers also played the role in increasing the volume -- they need "customers" much like McDonalds and use misleading advertisements, no entrance exams, and other tricks to lure people in.

    So university education now is a pretty perverted institution too.

    [Jan 25, 2017] Most college grads are working jobs that do not require a degree. Indeed many jobs routinely filled by high school graduates when I was young now want a college degree.

    Notable quotes:
    "... To insist that offshoring and illegal immigration were not partially responsible for the increase in US inequality is gross denial. As with the earlier moves to the southern states, the lives of the illegal immigrants and the workers in Mexico and Asia were improved, but US workers paid a dear price in wage loss. ..."
    "... Another huge factor was the financialization that was occurring during this period (perhaps somewhat due the other changes and their effect on the nations politics). ..."
    "... Most college grads are working jobs that do not require a degree. Indeed many jobs routinely filled by high school graduates when I was young now want a college degree. Melvin completely nails it. ..."
    "... College degree now serves as a filter to cut off unnecessary applicants. That does not means that the college degree by itself is not worth it. There is a value in the college degree beyond job market prospects. In this sense huge inflation of the cost of higher education is a big injustice in itself. ..."
    "... My last point would be that, with things like Dynasty trusts, it becomes much easier for the top .01% to maintain their place at the top of the income 'food chain', versus people born into families of more modest means. Those people in the .01% can send their children to the truly best schools in the country, whereas the rest of us go to whatever schools our parents can afford, or however much college debt we're willing to absorb. ..."
    Jan 25, 2017 | economistsview.typepad.com
    ken melvin : January 25, 2017 at 11:10 AM

    Why the surge in inequality? Good question. When did this surge begin? What was going on that might have led to this surge?

    Seems a lot of agreement on the 1970s as the beginning. What was going on in the 1970? Beginnings of offshoring to Mexico and Asia (the movement of well paying 'rustbelt' union jobs to the cheap labor southern states had begun earlier with questionable net in that southern labor gained and northern lost), industrial automation began to take off (especially in auto manufacturing – car plants that employed 5k in 1970 were producing more cars with 1.2k by the end of the 70s), but just as significant – about this time, the US began to lose market share to European and Asian manufacturing.

    The education thing is a canard. In the 1950s, Detroit employed millions of workers who had less than a high school education; by the late 50s, they demanded a high school diploma; today, they can demand an Associate degree. All apart of the selection process. Higher academic credentials help the individual find a better paying job, but do not in fact create anymore jobs, let alone the well paying assembly line jobs of before.

    To insist that offshoring and illegal immigration were not partially responsible for the increase in US inequality is gross denial. As with the earlier moves to the southern states, the lives of the illegal immigrants and the workers in Mexico and Asia were improved, but US workers paid a dear price in wage loss.

    Another huge factor was the financialization that was occurring during this period (perhaps somewhat due the other changes and their effect on the nations politics).

    In toto, it was a convergence of: loss of market, automation, offshoring, illegal immigrant laborers, this financialization that led to the surge in inequality.

    sanjait -> ken melvin... , January 25, 2017 at 11:24 AM
    "The education thing is a canard."

    Not at all.

    The paper above references a book called "The Race between Education and Technology" that provides a useful framing of the issue. Essentially:

    "The book argues that technological change, education, and inequality have been involved in a kind of race. During the first eight decades of the twentieth century, the increase of educated workers was higher than the demand for them. This had the effect of boosting income for most people and lowering inequality. However, the reverse has been true since about 1980. This educational slowdown was accompanied by rising inequality. The authors discuss the complex reasons for this, and what might be done to ameliorate it."

    However, authors of the paper mentioned in the OP do dismiss education as a major cause of inequality if we are looking at the 1% vs the 99% (rather than a more broad measure).

    DrDick -> sanjait... , -1
    Most college grads are working jobs that do not require a degree. Indeed many jobs routinely filled by high school graduates when I was young now want a college degree. Melvin completely nails it.

    http://www.attn.com/stories/1734/college-graduates-underemployed-working-requirements

    http://www.gallup.com/poll/164321/majority-workers-say-job-require-degree.aspx

    libezkova -> DrDick... , January 25, 2017 at 05:45 PM
    "Most college grads are working jobs that do not require a degree."

    College degree now serves as a filter to cut off unnecessary applicants. That does not means that the college degree by itself is not worth it. There is a value in the college degree beyond job market prospects. In this sense huge inflation of the cost of higher education is a big injustice in itself.

    Mike S -> ken melvin... , January 25, 2017 at 12:27 PM
    I agree that I don't think there was any one single thing which started driving inequality.

    You pointed out 'Beginnings of offshoring to Mexico and Asia (the movement of well paying 'rustbelt' union jobs to the cheap labor southern states had begun earlier with questionable net in that southern labor gained and northern lost)'. True, but implicitly those southern states were 'right to work' states which is why the labor was cheaper.

    Also, I believe in Thomas Pikkety's book 'Capital in the 21st Century' he pointed out that the top .01% have so much wealth, they can't spend all the income they earn from dividends, so that gets reinvested into more equities (stocks, bonds, et al) which then earn even more dividends.

    And when you point out automation, implicit in that is that the owners of the company (either privately or stockholders) will increase their share of the 'pie', so to speak, which gets split between the entrepreneurs and the workers, also increasing the inequality.

    My last point would be that, with things like Dynasty trusts, it becomes much easier for the top .01% to maintain their place at the top of the income 'food chain', versus people born into families of more modest means. Those people in the .01% can send their children to the truly best schools in the country, whereas the rest of us go to whatever schools our parents can afford, or however much college debt we're willing to absorb.

    [Jan 23, 2017] Students who took notes on laptops performed worse on conceptual questions than students who took notes longhand.

    Jan 23, 2017 | www.nakedcapitalism.com
    L , January 23, 2017 at 2:29 pm

    "Other findings show that pen and paper have an edge over the keyboard. Research by Princeton University and the University of California at Los Angeles, published in 2014, showed that the pen is indeed mightier than the keyboard. In three studies, researchers found that students who took notes on laptops performed worse on conceptual questions than students who took notes longhand. Those who took written notes had a better understanding of the material and remembered more of it because they had to mentally process information rather than type it verbatim" [BBC]. Wait. Computers make you stupid?

    Not surprising. The basic upshot is that computers encourage distraction and even when that is controlled for they encourage people to type down what they hear (i.e. transcribing) and not to encode, or distill it down to the important concepts. This latter is important because it means you are listening at a deeper level and thinking about what you are getting and are thus more likely to recall and use the knowledge later.

    [Jan 21, 2017] The DeVos Democrats

    Jan 21, 2017 | www.jacobinmag.com
    As many of her critics have pointed out, DeVos is a case study in the nefarious ways that big money shapes education policy in the United States. But she takes such criticism in stride. In 1997 she wrote: "I have decided . . . to stop taking offense at the suggestion that we are buying influence. Now I simply concede the point. They are right. We do expect some things in return."

    In short, DeVos is arguably the nation's most powerful proponent of school privatization - and now, even after bumbling her way through her confirmation hearing, she's set to take the reins of the Department of Education.

    American public schools have some very serious problems. Spend time in the crumbling public schools on the south side of Chicago and then venture over to the plush public schools in the leafy Chicago suburbs, and you'll experience alternative universes. Schools all over the greater Chicagoland are filled with committed and professional teachers, some quite excellent. But the students who attend the city schools arrive at school with stark disadvantages, unlike their better-off suburban peers. Discrepancies in school funding only exacerbate such class deficits.

    Most of the problems with the public schools, in other words, are outgrowths of a deeply unequal society. Yet the solution to this problem - the redistribution of wealth - is inimical to the interests of billionaires like DeVos. The fact that she will soon be in charge of the nation's schools is a sick joke. Make no mistake: DeVos is a serious threat to public education and should be treated accordingly.

    Unfortunately, many Democrats have long supported the same so-called education reform measures that DeVos backs. Often wrapping these measures in civil rights language, Democratic education reformers have provided cover for some of the worst types of reforms, including promoting the spread of charter schools - the preferred liberal mechanism for fulfilling the "choice" agenda. (Charter schools operate with public money, but without much public oversight, and are therefore often vehicles for pet pedagogical projects of billionaire educational philanthropists like Bill Gates and Mark Zuckerberg.)

    DeVos will not have to completely reverse the Department of Education's course in order to fulfill her agenda. Obama's "Race to the Top" policy - the brainchild of former Secretary of Education Arne Duncan, past CEO of Chicago Public Schools - allocates scarce federal resources to those states most aggressively implementing education reform measures, particularly around charter schools.

    Perhaps the most effective advocate of school choice is New Jersey senator Cory Booker, who many Democrats are touting as the party's savior in the post-Obama era. Liberals swooned when Booker opposed his Senate colleague Jeff Sessions, the right-wing racist Trump tapped to be the next attorney general. But however laudable, Booker's actions didn't take much in the way of courage.

    Booker's funders - hedge-fund managers and pharmaceutical barons - don't care about such theatrics. They're more concerned that he vote Big Pharma's way and keep up his role as a leading member of Democrats for Education Reform, a pro-privatization group. They want to make sure he continues attacking teachers' unions, the strongest bulwark against privatization.

    Their aim is to undercut public schools and foster union-free charter schools, freeing the rich from having to pay teachers as unionized public servants with pensions.

    So in the fight against Trump and DeVos, we can't give Booker and his anti-union ilk a pass. As enablers of DeVos's privatization agenda, they too must be delegitimized.

    Public education depends on it. The beautiful school where I send my children depends on it.

    [Jan 21, 2017] Obama invigorated the worst of the corporate education reform movement

    Notable quotes:
    "... three decades the national conversation about education has been held hostage by the anxiety-inducing metaphors that always accompany the neoliberal dismantling of public services. ..."
    "... President Obama and his advisers have done little to resist this state of affairs, carrying out low-intensity warfare on teachers' unions and perpetuating harmful myths that the American school system is "life-saving" (because we live in a meritocracy), that it is "in crisis" (because test scores are falling behind globally), and that it can only be saved by the free-market fixes (competition, standards, accountability, and choice) originally advocated by conservative think-tanks like the Heritage Foundation and billionaire philanthropists. ..."
    "... Of all the education initiatives with names that sound like spaceships (America 2000, Goals 2000) or battle cries (No Child Left Behind), Race to the Top, the Obama administration's signature contribution to the genre, may be the most successful assault yet in the sustained effort to destroy the democratic project of public schooling. ..."
    Jan 21, 2017 | www.jacobinmag.com

    In some languages, the words for "teach" and "learn" are the same, suggesting a view of education as a cooperative activity, rather than as something that is done to students. Not in English, and certainly not in the United States, where for three decades the national conversation about education has been held hostage by the anxiety-inducing metaphors that always accompany the neoliberal dismantling of public services.

    President Obama and his advisers have done little to resist this state of affairs, carrying out low-intensity warfare on teachers' unions and perpetuating harmful myths that the American school system is "life-saving" (because we live in a meritocracy), that it is "in crisis" (because test scores are falling behind globally), and that it can only be saved by the free-market fixes (competition, standards, accountability, and choice) originally advocated by conservative think-tanks like the Heritage Foundation and billionaire philanthropists.

    Of all the education initiatives with names that sound like spaceships (America 2000, Goals 2000) or battle cries (No Child Left Behind), Race to the Top, the Obama administration's signature contribution to the genre, may be the most successful assault yet in the sustained effort to destroy the democratic project of public schooling. In 2009, more than $4 billion of public funds were set aside for K-12 education as part of TARP, representing a moment of enormous possibility for the president. The money could have been used to equalize funding among schools ( which is exceptionally inequitable in America ) or to incentivize states to make changes that we know improve educational outcomes for poor children and children of color, like reducing class sizes and promoting socioeconomic and racial integration .

    Instead, the Obama administration chose to use a series of competitive grants to push the adoption of the Common Core standards, the linking of teacher evaluations to student test scores, and the expansion of charter schools. These measures were deemed "innovative," even in the face of growing evidence that charter test scores are no better than those of traditional public schools and that charters are more stratified by race, class, special education status, and possibly language, than public schools.

    Today, forty-two of fifty states are members of the Common Core Standards Initiative and nearly half tie teacher evaluations to test scores, an enormous transformation in policy. Yet test scores on the NAEP (known as "America's report card") have fallen for the first time, and Race to the Top has failed to deliver even by its own paltry and unimaginative measures. Meanwhile, the real crisis facing children - a disgraceful level of poverty - has gone unnamed by anyone but Bernie Sanders, let alone addressed.

    It was nice that Obama called out the widening wealth gap during his farewell address, but the ultimate legacy of his administration has been the deepening of that inequality through the advancement of the agenda of the Broad, Walton Family, and Gates Foundations over the demands of the American people for free, high-quality, and equitably funded schools (a counsel for the education department even once mistakenly referred to the Obama administration as "the Gates administration").

    Privatization efforts under Trump will be worse. Clearly, no one is going to give us control of our schools. We're going to have to take it. In 2016, the Black Lives Matter movement and the NAACP called for a moratorium on charter schools - it's a start.

    –Megan Erickson

    [Jan 12, 2017] Students who took at least Ecnomics 101 should understand the Economics 101 is a scam (or more correctly a couse for indoctrination into neoliberal religion, a new type of Lysenkoism for listening which you should be paid, not the college) and financing a six-figure college expenditure with debt bearing exceedingly onerous termsis another scam

    Notable quotes:
    "... students schooled in Home Econ would cast a jaundiced eye on financing a six-figure college expenditure with debt bearing exceedingly onerous terms. College debt is precisely the sort of scam that well-prepared young people learn to take a hard-nosed look at. ..."
    Jan 12, 2017 | www.nakedcapitalism.com
    Jim Haygood , January 12, 2017 at 4:23 pm

    Your practical insights used to be imparted to high school students in Home Economics.

    But Home Econ sounded too, errr, blue collar to the aspirational upper middle class. As well, students schooled in Home Econ would cast a jaundiced eye on financing a six-figure college expenditure with debt bearing exceedingly onerous terms. College debt is precisely the sort of scam that well-prepared young people learn to take a hard-nosed look at.

    So for the greater good of all, Home Econ had to be phased out, so that its subversive truisms would not interfere with the vital missions of higher education and consumer upselling.

    Waldenpond , January 12, 2017 at 4:45 pm

    May not be married but what % are living at home or with roommates? So people are still cohabitating to reduce overhead.

    I wouldn't pick up something by a dumpster, but I frequent thrift stores and estate/yard sales. Once I'm done with my thrift store clothes, they get recycled to other projects. Can even cut small strips to tie up peas and beans in the garden.

    I agree with the no debt. Don't do it or you're screwed. I have two kids . we've been very clear, come to us before hand, we'll help if we can, otherwise you go without and if you ever do debt, you're on your own.

    Of course, we told both adults not to marry like us. They both did. One ceremony at a park the other signed papers at our house but no parties/weddings. We've made clear we can't afford kids. One has one kid, the other is considering it.

    Managing money, house repairs, land mgmt etc are all electives. Very few take them.

    [Jan 09, 2017] Intel CEO reveals how he almost got himself fired 25 years ago

    Notable quotes:
    "... Fortt Knox is a weekly podcast from CNBC anchor Jon Fortt. Previous broacasts of the program can be found here . ..."
    Jan 09, 2017 | finance.yahoo.com

    ... ... ...

    Krzanich grew up in San Jose, California, just miles from Intel headquarters. He didn't go to an Ivy League school: He got his bachelor's degree in Chemistry from San Jose State University. The prestige of a college's brand on a résumé doesn't impress him.

    "I've told my daughters this; my older daughter's about to go into college. It doesn't matter what college you go to. The thing that was great about San Jose State was, I got connected with some very good professors," he said.

    He did research for their projects on the side. "When I went into interviews, I could talk about real work that I'd done, not just textbook stuff," Krzanich added.

    That informs how he deals with job candidates today. "I ask real simple questions that just tell me, does this person know how to think?"

    Krzanich had some more advice. "The other thing I tell my daughters is, I've had to terminate or fire more people for being difficult to work with than being dumb."

    ... ... ...

    Fortt Knox is a weekly podcast from CNBC anchor Jon Fortt. Previous broacasts of the program can be found here . Rock 4 hours ago On Small Business
    21 percent of CEOs are psychopaths............one in five chief executives are psychopaths. At least, that's what was found by a recent study of 261 senior corporate professionals in the United States..........................

    "Typically psychopaths create a lot of chaos and generally tend to play people off against each other," Nathan Brooks, a forensic psychologist and the lead researcher of the study said in this report from The Telegraph. "For psychopaths, it [corporate success] is a game and they don't mind if they violate morals. It is about getting where they want in the company and having dominance over others." PU 4 hours ago I have worked for him, his way or the highway...very difficult to work for. Bill 4 hours ago I worked with BK in the 90s and he was not the easiest guy to interact with, but creative people usually aren't. He was a good engineer though. Backlash 37 minutes ago I had a very rewarding career at Intel and much my success I attribute to the mentoring I received from Andy Grove. He was a visionary second to none and believed that constructive confrontation cut through all the crap and expedited the identification of problems and the rapid implementation of solutions.

    He knew how to get your attention, provided you the tools to get your job done and expected you to deliver on your commitments. Bob Noyce and Gordon Moore had a softer approach but they too could get your attention and make it very clear what you had to deliver.

    These founders of one of America's most successful corporations personal and professional legacies set a high standard for the coming generations. Michael W 2 hours ago Would have been interesting to know what the actual problem was and the solution. From the term "Copy Exactly" it looks like he had issues with transferring the technology from one place to another and allowed "improvements" on a working process. Key 2 hours ago Copy exactly is the death of Intel as we know it. It stifles innovation in manufacturing processes to reduce cost an increase productivity. This is a typical over reaction from disconnected management that has made Intel into a company that can only increase its revenue by laying off workers.

    [Jan 06, 2017] The straight A student who dropped out of university

    While facts are correct the move was probably stupid. He could transfer to less expensive collage or just finish community collage first. you can't replace collage experices. and sutudents often matter more then professors. KSU has reasonable fees (less then $6K for 16 credits a semester) See Tuition and Fees and k-state.edu
    He would be better off by returning, especially if the company he joins pay to tuition or at least part of it.
    Notable quotes:
    "... "cost of inflation is relatively small compared to the cost of college over the last 30 or so years. I mean, it really is ridiculous how the cost of college has gone up." ..."
    "... In 1980, the average cost of tuition, room and board, and fees for a four-year course was over $9,000. That cost now is more than $23,000 for state colleges. If you want to go private it's more than $30,000. ..."
    "... In the post Willson also cited higher education debt as a reason to leave university and enter the work place. Students in the United States are estimated to be in around over $1.2 trillion of loan debt with 7 million borrowers in default. ..."
    www.bbc.com

    Billy Willson received a 4.0 grade point average, the equivalent to straight A's, for his first semester at Kansas State University. He decided that it would also be his last.

    In a strongly worded Facebook post, Willson uploaded a photograph of himself standing outside the university's sign, holding his middle finger up to it. In the accompanying text he wrote:

    "YOU ARE BEING SCAMMED. You may not see it today or tomorrow, but you will see it some day,"

    "You are being put thousands into debt to learn things you will never even use. Wasting 4 years of your life to be stuck at a paycheck that grows slower than the rate of inflation. Paying $200 for a $6 textbook."

    His post, which has been shared more than 10,000 times in little more than a fortnight and has provoked a vigorous debate in the comments, appears to have struck a chord with other young adults who are wondering if pursuing higher education is worth the time and money.

    Willson, who was on an Architectural Engineering undergraduate course told BBC Trending that the "cost of inflation is relatively small compared to the cost of college over the last 30 or so years. I mean, it really is ridiculous how the cost of college has gone up."

    He's backed up by data. According to the US Department of Education the average annual increase in college tuition in the United States, between 1980-2014, grew by nearly 260% compared to the nearly 120% increase in all consumer items.

    In 1980, the average cost of tuition, room and board, and fees for a four-year course was over $9,000. That cost now is more than $23,000 for state colleges. If you want to go private it's more than $30,000.

    ... ... ...

    In the post Willson also cited higher education debt as a reason to leave university and enter the work place. Students in the United States are estimated to be in around over $1.2 trillion of loan debt with 7 million borrowers in default.

    [Jan 03, 2017] New York Governor Proposes Free College For Lower-Income Students The Two-Way

    Notable quotes:
    "... "College is a mandatory step if you really want to be a success," Cuomo told the crowd. ..."
    Jan 03, 2017 | NPR

    New York Gov. Andrew Cuomo has unveiled a proposal to offer free tuition for lower-income New Yorkers attending state-run colleges, an idea embraced by last year's Democratic presidential contenders.

    The plan announced Tuesday – called the Excelsior Scholarship – would grant full-rides to students from families earning less than $125,000 a year, as long as they attend one of the state's public two- or four-year colleges.

    The plan announced Tuesday – called the Excelsior Scholarship – would grant full-rides to students from families earning less than $125,000 a year, as long as they attend one of the state's public two- or four-year colleges.

    Speaking at LaGuardia Community College in New York's Queens borough, the Democratic governor said his proposal could allow students from some 940,000 families to attend college, which is key to scoring about 70 percent of jobs in the state, Reuters quotes Cuomo as saying.

    "College is a mandatory step if you really want to be a success," Cuomo told the crowd.

    Joining the governor, Vermont Sen. Bernie Sanders cheered the proposal.

    ... ... ...

    Cuomo's proposal, which would apply only to New York residents, iwould cost about $163 million annually and be in place by 2019 – that's if it passes the state's legislature, The New York Times reports.

    ... ... ...

    As it stands currently, tuition at the public State University system is $6,470 a year; a two-year degree runs at about $4,350.

    The price-tag at the state's other public system, City University, runs roughly the same.

    While New York has need-based tuition awards, those tap out at $5,165 per school year.

    [Jan 01, 2017] Education Excerpt from Economics in Two Lessons by John Quiggin

    Notable quotes:
    "... Moreover, although the evidence is murky it seems that an increasing proportion of charters are being run on a for-profit basis, even in cases where formal structure is non-profit. Given the failure of the for-profit model in general, the prospects for the future are not good. ..."
    "... On the other hand, an analysis based on prices falls down badly in the attempt to describe education as a market transaction. All the terms of the Second Lesson are relevant here. Education is characterized by market failure, by potentially inequitable initial allocations and, most importantly, by the fact that the relationship between the education 'industry' and its 'consumers', that is between educational institutions and teachers on the one hand and students on the other, cannot be reduced to a market transaction. ..."
    "... The result is that education does not rely on market competition to any significant extent to sort good teachers and institutions from bad ones. Rather, education depends on a combination of sustained institutional standards and individual professional ethics to maintain their performance. ..."
    "... One subject which is not taught in school or Universities, is to control greed, which is the biggest malaise in the world today, as it was thousands of years ago ..."
    "... "an increasing proportion of charters are being run on a for-profit basis, even in cases where formal structure is non-profit" ..."
    "... You may want to make clear that this can be done by buying services from for-profit companies owned by the management of the charter schools. ..."
    "... "In a modern society, education is the most important single factor determining a person's life chances." ..."
    "... Is this perhaps overstated? I'd have thought that the most important factor is the socioeconomic status of one's parents. ..."
    "... Ask any affluent parent about the best school districts in their county, or the best schools within their school districts, and you'll get confident and well informed answers. ..."
    "... And of course these parents act on this knowledge by spending money by buying houses in neighborhoods with good schools. Given local funding, in the US we get a nasty positive feedback loop that creates huge inequalities at the expense of less affluent parents -- better schools mean higher real estate prices which means higher assessed values which means more tax revenues for funding the better schools which means they get even better. The less affluent are steadily priced out of this market, and their choices dwindle -- they're stuck with crappy schools. ..."
    December 29, 2016 | crookedtimber.org

    Here's another excerpt from my book-in-progress, Economics in Two Lessons . As usual, praise is welcome, useful criticism even more so. You can find a draft of the opening sections here .

    In the section over the fold, I'm looking at education.

    In a modern society, education is the most important single factor determining a person's life chances. The average who holds a professional or doctoral degree earns more than twice as much as someone without a four-year college degree, and is virtually assured of being employed (at a time of deep depression in 2011, only 2.5 per cent of higher-degree holders were unemployed). In economic terms, the education sector is one of the largest in the economy.

    However, this statistical analysis seriously underestimates the economic importance of sector, because it ignores the First Lesson. The true cost of education comprises not just the salaries of teachers and the cost of running schools and universities, but the opportunity cost of the time spent in education by students.

    The failure to take proper account of the First Lesson is a big problem in understanding the economics of education. But the failure to understand the Second Lesson has been much more of a problem for policy.

    Simple-minded analyses based on a simplistic reading of the First Lesson have driven the irsteducation debate in the US and other English-speaking countries for the last few decades. The dominant idea is that education is a product like any other and that the best guarantee of good education is market competition between providers. The villains in this story are public goods and, especially, teacher unions.

    To make education more like a private good, advocates of he First Lesson tried to change the conditions of both supply and demand. On the demand side, the central proposal was that of education 'vouchers', put forward most notably by Nobel Prizewinning economist at the University of Chicago, Milton Friedman. The idea was that, rather than funding schools, government should provide funding directly parents in the form of vouchers that could be used at whichever school the parents preferred, and topped up, if necessary by additional fee payments.

    As is typically the case, voucher advocates ignored the implications of their proposals for the distribution of income. In large measure, vouchers represent a simply cash transfer, going predominantly from the poor to the rich. The biggest beneficiaries would be those, mostly well-off, who were already sending their children to private schools, for whom the voucher would be a simple cash transfer. Those whose children remained at the same public school as before would gain nothing.

    On the supply side, the central idea was the introduction of for-profit schools and colleges to a sector traditionally dominated by public and non-profit educational institutions. For-profit educational institutions had a spectacular rise and fall.

    The most notable entrant in the US school sector was Edison Schools. Edison Schools was founded in 1992 and was widely viewed as representing the future of school education. Its plans were drawn up by a committee headed by John Chubb, the co-author of the most influential single critique of public sector education in the United States (Chubb and Moe 1990). For-profit schools were also introduced in Chile and Sweden.

    At the university level, for-profit enterprises proliferated with the University of Phoenix was the most notable example. For-profit trade and vocational schools also expanded in the US, and, even more dramatically in Australia, where a poorly-designed subsidy scheme produced a spectacular expansion.

    The story was much the same everywhere: an initial burst of enthusiasm and high profits, followed by the exposure of poor practices and outcomes, and finally collapse, with governments being left to pick up the pieces.

    Edison Schools, launched on the stockmarket with a flourish in 1999, lost most of its value and was subsequently taken private. At its peak, Edison ran hundreds of schools throughout the US. It has now faded into obscurity under the name EdisonLearning.

    Sweden introduced voucher-style reforms in 1992, and opened the market to for-profit schools. Initially favorable assessments were replaced by disillusionment as the performance of the school system as a whole deteriorated. Scores on the international PISA test plummeted

    https://www.theguardian.com/world/2015/jun/10/sweden-schools-crisis-political-failure-education

    and dissatisfaction became general

    https://www.theguardian.com/world/2015/jun/10/sweden-schools-crisis-political-failure-education

    By 2015, the majority of the public favored banning for-profit schools. The Minister for Education described the system as a 'political failure', Other critics described it in harsher terms.

    The Swedish for-profit 'free' school disaster

    Although a full analysis has not yet been undertaken, it seems likely that the for-profit schools engaged in 'cream-skimming', admitting able and well-behaved students, while pushing more problematic students back into the public system. The rules under which the reform was introduced included 'safeguards' to prevent cream-skimming, but such safeguards have historical proved ineffectual in the face of the profits to be made by evading them.

    Similar processes took place in Chile, under the influence of the Chicago-trained reformers whose policies were implemented by the Pinochet dictatorship. There were glowing initial reports, but the eventual outcome was to amplify inequality without improving performance. Chile banned for-profit education in 2015

    The for-profit university sector followed a similar trajectory. The University of Phoenix epitomised the process. Enrolments peaked at 600 000 in 2010, but had fallen to 142 000 by 2016 as the US government cracked down on shady enrolment practices. Other for-profit universities closed altogether or converted to non-profit status

    Perhaps the most spectacular boom and bust took place in my native Australia. From tiny beginnings around 2007, a scheme to provide loans-based funding for vocational training grew into a full-blown educational and budgetary disaster. Even more than in the for-profit US university sector, the companies involved found it profitable to exploit the weaknesses of the funding system, and the fact that students could not judge the quality of education in advance, rather than to do the hard work of providing improved education.

    The results speak for themselves. By the time a conservative government radically restricted the scheme in late 2016, the estimated losses to the budget ran into the billions of dollars, while thousands of students were left with unrepayable debts and worthless qualifications. Meanwhile, the public system of Technical and Further Education, which had worked well for decades had suffered grave and possibly irreparable damage.

    The failure of full-scale privatisation left the field open to the main remaining alternative 'charter' schools. The idea of charter schools was originally put forward by Albert Shanker, the president of the American Federation of Teachers. His idea was to encourage schools where teachers had more opportunities to try out innovative approaches, and where the student body would be more diverse, both economically and racially.

    In the hands of the education reform movement, however, charter schools took on a very different tone and purpose, much closer to that of the for-profit model that failed with Edison. While some independent charter schools have pursued innovation along the lines suggested by Shanker, others are part of chains relying on services like management companies, including for-profits like EdisonLearning.

    Charter schools have been, and remain, politically popular with Republicans and Democrats alike.

    The only problem is that, according to the empirical evidence, they don't work. Charter schools have not failed spectacularly, as for-profits have done, but they have not yielded any significant return for the money and political effort that has been poured into their expansion.

    http://www.in-perspective.org/pages/student-achievement

    Nationally, there is very little evidence that charter and traditional public schools differ meaningfully in their average impact on students' standardized test performance.

    Moreover, although the evidence is murky it seems that an increasing proportion of charters are being run on a for-profit basis, even in cases where formal structure is non-profit. Given the failure of the for-profit model in general, the prospects for the future are not good.

    Why has market-oriented reform of education been such a failure? Every part of the Second Lesson is relevant here. On the 'production' side, education is, in many respects similar to other industries. Prices send signals about the cost of providing particular courses of study in particular ways, and of the rewards of one kind of employment or another. Institutions and educators respond to those signals. Students try to weigh the cost and the likely monetary benefits of continuing education, or of seeking employment, along with less tangible costs and benefits, and decide accordingly.

    On the other hand, an analysis based on prices falls down badly in the attempt to describe education as a market transaction. All the terms of the Second Lesson are relevant here. Education is characterized by market failure, by potentially inequitable initial allocations and, most importantly, by the fact that the relationship between the education 'industry' and its 'consumers', that is between educational institutions and teachers on the one hand and students on the other, cannot be reduced to a market transaction.

    The critical problem with this simple model is that students, by definition, cannot know in advance what they are going to learn, or make an informed judgement about what they are learning. They have to rely, to a substantial extent, on their teachers to select the right topics of study and to teach them appropriately.

    Moreover, any specific course of education is a once-only experience in most cases. Students may judge, in retrospect, that particular teachers, courses or institutions were good or bad, but in either case they are unlikely to return, so that there is no direct market return to high quality performance.

    The result is that education does not rely on market competition to any significant extent to sort good teachers and institutions from bad ones. Rather, education depends on a combination of sustained institutional standards and individual professional ethics to maintain their performance.

    The implications for education policy are clear, at least at the school level. School education should be publicly funded and provided either by public schools or by non-profits with a clear educational mission, as opposed to corporate 'school management organisations'.

    Post-school education raises more complex problems, regrettably beyond the scope of this book. But the key element should be to make high quality post-school education available, and affordable, for all young people.

    Bill Hawil 12.29.16 at 10:50 am ( 1 )

    With very little education, I,am hardly qualified to comment on this topic.

    I do consider that education should be available to all students irrespective of their parents wealth, by the government, and if the higher educated earn more, then they should pay more taxes so that the government have the funds to provide free education.

    One subject which is not taught in school or Universities, is to control greed, which is the biggest malaise in the world today, as it was thousands of years ago

    Mike Huben 12.29.16 at 2:31 pm ( 5 )

    "an increasing proportion of charters are being run on a for-profit basis, even in cases where formal structure is non-profit"

    You may want to make clear that this can be done by buying services from for-profit companies owned by the management of the charter schools.

    You may want to examine the Education index at my Critiques of Libertarianism wiki to see if there is something you can use. For example, you don't mention the failures of MOOCs.

    You might also mention the big picture idea that there is a lengthy history of educational policy entrepreneurs, whose ideas become fads and then fail. These are just the latest.

    jdkbrown 12.29.16 at 3:38 pm

    "In a modern society, education is the most important single factor determining a person's life chances."

    Is this perhaps overstated? I'd have thought that the most important factor is the socioeconomic status of one's parents.

    Olle J. 12.29.16 at 4:14 pm

    As someone that reads the newspaper, the occasional report, and works with the "products" coming out of Swedish secondary education (i.e. what used to be called students), it might be worth noting that the introduction of vouchers and free choice are not the only thing that have been accused of causing the declining school results (and increased inequality).

    Other purposed causes include the decentralization of schools from the state to the local municipalities; educational reforms that have introduced modern pedagogy ("flumpedagogik", hippie pedagogy, is the derogatory term); teachers spending more and more time documenting things for different forms of evaluations instead of teaching or preparing classes; as well as the declining status, class room autonomy, and salaries of teachers (resulting in deskilling and that better students shuns from becoming teachers). The jury is still out on what, or rather which combination, caused the declining test results in Pisa (and Timms; although results both are up again this year).

    Jake Gibson 12.29.16 at 6:43 pm ( 9 )

    Don't underestimate the political goal of the right to undermine teacher's unions and to turn public goods into profit streams.

    engels 12.29.16 at 6:53 pm

    In a modern society, education is the most important single factor determining a person's life chances.

    Prince Charles seems to be doing a fair bit better than me and he's only got a couple of O-levels (as well as being a certifiable fuckwit). I think Thomas Piketty had something to say about this atrange and hitherto unnoticed phenomenon

    engels 12.29.16 at 6:56 pm ( 11 )

    (Also think I read somewhere that people with PhDs on average make less than people with BAs, and what jdkbrown said, but can't check now.)

    Alex K. 12.29.16 at 7:16 pm

    Sorry, but this is a hack job.

    The link leads to a piece that relies on a Slate article. The Slate article about the Swedish school system was criticized at the time:

    http://www.nationalreview.com/agenda/383304/sweden-has-education-crisis-it-wasnt-caused-school-choice-tino-sanandaji

    http://educationnext.org/sweden-school-choice/

    Then you have cherry-picking of failures, but completely ignore private school successes, like say, Korea.

    The theoretical criticism is silly: "The critical problem with this simple model is that students, by definition, cannot know in advance what they are going to learn, or make an informed judgement about what they are learning."

    This proves too much: it is something that would be true for for-profits as well as for non-profit private systems. Yet in the USA, the private universities are consistently the top universities. You don't have to know Quantum Physics before judging if a university has a good or bad physics program.

    The sentence is also a criticism of school choice in general, yet the middle classes in the US have no problem in figuring out where to buy houses to get away from failing schools.

    There is a valid point to be made, namely that the institutional design of private-public partnerships needs to focus intensely on avoiding the gaming of the system. Bureaucrats with only vague interest in designing a successful system often don't do that. But they only have to get it right once. Running a public system well means getting t