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|Is it really necessary for every economist to be brain-dead apologist for the rich and powerful and predatory, in every damn breath?|
|Smith briskly takes a sledgehammer to any number of plaster saints
cluttering up the edifice of modern economics:
"assumptions that are patently ridiculous: that individuals are rational and utility-maximizing (which has become such a slippery notion as to be meaningless), that buyers and sellers have perfect information, that there are no transaction costs, that capital flows freely"
And then...papers with cooked figures, economists oblivious to speculative factors driving oil prices, travesty versions of Keynes's ideas that airbrush out its most characteristic features in the name of mathematical tractability.
And then...any number of grand-sounding theoretical constructs: the Arrow-Debreu theorem, the Dynamic Stochastic General Equilibrium model, the Black-Scholes option model, Value at Risk, CAPM, the Gaussian copula, that only work under blatantly unrealistic assumptions that go by high falutin' names - equilibrium, ergodicity, and so on.
The outcome of this pseudo-scientific botching is an imposing corpus of pretentious quackery that somehow elevates unregulated "free markets" into the sole mechanism for distribution of the spoils of economic activity. We are supposed to believe that by some alchemical process, maximum indulgence of human greed results in maximum prosperity for all. That's unfair to alchemy: compared with the threadbare scientific underpinnings of this economic dogma, alchemy is a model of rigor.
|How many others are being paid for punditry? Or has the culture of corruption
spread so far that the question is, Who isn't?
"MIT and Wharton and University of Chicago created the financial engineering instruments which, like Samson and Delilah, blinded every CEO. They didn't realize the kind of leverage they were doing and they didn't understand when they were really creating a real profit or a fictitious one."
When you see this "neoclassical" gallery of expensive intellectual prostitutes (sorry, respectable priests of a dominant religion) that pretend to be professors of economics in various prominent universities, it is difficult not to say "It's political economy stupid". Those lackeys of ruling elite are just handing microphone bought by financial oligarchy. Here is am Amazon.com review of ECONned How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism eBook Yves Smith that states this position well:
kievite:Neoclassical economics as a universal door opener for financial oligarchy
There are many good reviews of the book published already and I don't want to repeat them. But I think there is one aspect of the book that was not well covered in the published reviews and which I think is tremendously important and makes the book a class of its own: the use of neoclassical economics as a universal door opener for financial oligarchy. I hope that the term "econned" will became a new word in English language.
Neoclassical economics has become the modern religion with its own priests, sacred texts and a scheme of salvation. It was a successful attempt to legitimize the unlimited rule of financial oligarchy by using quasi-mathematical, oversimplified and detached for reality models. The net result is a new brand of theology, which proved to be pretty powerful in influencing people and capturing governments("cognitive regulatory capture"). Like Marxism, neoclassical economics is a triumph of ideology over science. It was much more profitable though: those who were the most successful in driving this Trojan horse into the gates were remunerated on the level of Wall Street traders.
Economics is essentially a political science. And politics is about perception. Neo-classical economics is all about manipulating the perception in such a way as to untie hands of banking elite to plunder the country (and get some cramps from the table for themselves). Yves contributed to our understanding how "These F#@king Guys" as Jon Steward defined them, economics professors from Chicago, Harvard, Columbia, Princeton and some other places warmed by flow of money from banks for specific services provided managed to serve as a fifth column helping Wall Street to plunder the country. The rhetorical question that a special counsel to the U.S. Army, Joseph Welch, asked Senator McCarthy: "Have you no sense of decency?" applies.
The main effect of neoclassical economics is elevating unregulated ( "free" in neoclassic economics speak) markets into the key mechanism for distribution of the results of economic activity with banks as all-powerful middlemen and sedating any opposition with pseudo-mathematical mumbo-jumbo. Complexity was used as a powerful smoke screen to conceal greed and incompetence. As a result financial giants were able to loot almost all sectors of economics with impunity and without any remorse, not unlike the brutal conquerors in Middle Ages.
The key to the success of this nationwide looting is that people should be brainwashed/indoctrinated to believe that by some alchemical process, maximum level of greed results in maximum prosperity for all. Collapse of the USSR helped in this respect driving the message home: look how the alternative ended, when in reality the USSR was a neo-feudal society. But the exquisite irony here is that Bolsheviks-style ideological brainwashing was applied very successfully to the large part of the US population (especially student population) using neo-classical economics instead of Marxism (which by-and-large was also a pseudo-religious economic theory with slightly different priests and the plan of salvation ;-). The application of badly constructed mathematical models proved to be a powerful tool for distorting reality in a certain, desirable for financial elite direction. One of the many definitions of Ponzi Scheme is "transfer liabilities to unwilling others." The use of detached from reality mathematical models fits this definition pretty well.
The key idea here is that neoclassical economists are not and never have been scientists: much like Marxist economists they always were just high priests of a dangerous cult -- neoliberalism -- and they are more then eager to stretch the truth for the benefit of the sect (and indirectly to their own benefit). All-in-all this is not unlike Lysenkoism: state support was and still is here, it is just working more subtly via ostracism, without open repressions. Look at Shiller story on p.9.
I think that one of lasting insights provided by Econned is the demonstration how the US society was taken hostage by the ideological views of the neoclassical economic school that has dominated the field at least for 30 or may be even 50 years. And that this ideological coup d'état was initiated and financed by banking establishment who was a puppeteer behind the curtain. This is not unlike the capture of Russia by Bolsheviks supported by German intelligence services (and Bolshevics rule lasted slightly longer -- 65 years). Bolsheviks were just adherents of similar wrapped in the mantle of economic theory religious cult, abeit more dangerous and destructive for the people of Russia then neoclassical economics is for the people of the USA. Quoting Marx we can say "History repeats itself, first as tragedy, second as farce".
That also means that there is no easy way out of the current situation. Ideologies are sticky and can lead to the collapse of society rather then peaceful evolution.
So it's no surprise that there is a strong evidence that neo-classical economics is not a science, it's a political ideology of financial oligarchy masquerading as science. Or a religious cult, if you wish.
|So it's no surprise that there is a strong evidence that neo-classical economics is not a science, it's a political ideology of financial oligarchy masquerading as science. Or a religious cult, if you wish.|
The cult which served as a Trojan horse for bankers to grab power and wealth by robbing fellow Americans. In a way this is a classic story of a parasite killing the host. The powers that be in academia put their imprimatur on economic ‘theory,’ select and indoctrinate its high priests to teach it, and with a host of media players grinding out arguments pro and con this and that, provide legitimacy sufficient for cover of bankers objectives. Which control the disposition and annuity streams of pension fund assets and related financial services. In his new documentary Inside Job, filmmaker Charles Ferguson provides strong evidence of a systematic mass corruption of economic profession (Yahoo! Finance):
Ferguson points to 20 years of deregulation, rampant greed (a la Gordon Gekko) and cronyism. This cronyism is in large part due to a revolving door between not only Wall Street and Washington, but also the incestuous relationship between Wall Street, Washington and academia.The conflicts of interest that arise when academics take on roles outside of education are largely unspoken, but a very big problem. “The academic economics discipline has been very heavily penetrated by the financial services industry,” Ferguson tells Aaron in the accompanying clip. “Many prominent academics now actually make the majority of their money from the financial services industry, not from teaching or research. [This fact] has definitely compromised the research work and the policy advice that we get from academia.”
... ... ...
Feguson is astonished by the lack of regulation demanding financial disclosure of all academics and is now pushing for it. “At a minimum, federal law should require public disclosure of all outside income that is in any way related to professors’ publishing and policy advocacy,” he writes. “It may be desirable to go even further, and to limit the total size of outside income that potentially generates conflicts of interest.”
The dismantling of economic schools that favor financial oligarchy interests over real research (and prosecuting academic criminals -- many prominent professors in Chicago, Harvard, Columbia and other prominent members of neo-classical economic church) require a new funding model. As neoliberalism itself, the neoclassical economy is very sticky. Chances for success of any reform in the current environment are slim to non existent.
Here is one apt quote from Zero Hedge discussion of Gonzalo Lira article On The Identity Of The False Religion Behind The Mask Of Economic Science zero hedge
"They analyze data for Christ sakes"
Just like Mishkin analyzed Iceland for $120k? a huge proportion in US [are] on Fed payroll, or beneficiaries of corporate thinktank cash; they are coverup lipstick and makeup; hacks for hire.
Like truth-trashing mortgage pushers, credit raters, CDO CDS market manipulators and bribe-fueled fraud enablers of all stripes -- they do it for the dough -- and because everybody else is doing it.
It's now a common understanding that "These F#@king Guys" as Jon Steward defined them, professors of neoclassical economics from Chicago, Harvard and some other places are warmed by flow of money from financial services industries for specific services provided managed to serve as a fifth column helping financial oligarchy to destroy the country. This role of neo-classical economists as the fifth column of financial oligarchy is an interesting research topic. Just don't expect any grants for it ;-).As Reinhold Niebuhr aptly noted in his classic Moral Man and Immoral Society
Since inequalities of privilege are greater than could possibly be defended rationally, the intelligence of privileged groups is usually applied to the task of inventing specious proofs for the theory that universal values spring from, and that general interests are served by, the special privileges which they hold.
I would like to stress it again: they are not and never have been scientists: they are just high priests of dangerous cult -- neoliberalism -- and they are more then eager to stretch the truth for the sect (and that means their own) benefits. Fifth column of financial oligarchy. All-in-all this is not unlike Lysenkoism: at some point state support became obvious as financial oligarchy gained significant share of government power (as Glass-Steagall repeal signified). It is just more subtle working via ostracism and flow of funding, without open repressions. See also Politicization of science and The Republican War on Science
Like Russia with Bolsheviks, the US society was taken hostage by the ideological views of the Chicago economic school that has dominated the field for approximately 50 years ( as minimum over 30 years). Actually the situation not unlike the situation with Lysenkoism is the USSR. It's pretty notable that the USA suffered 30 years of this farce, actually approximately the same amount of time the USSR scientific community suffered from Lysenkoism (1934-1965)
|"Over the past 30 years, the economics profession—in economics departments, and in business,
public policy, and law schools—has become so compromised by conflicts of interest that it now
functions almost as a support group for financial services and other industries whose profits
depend heavily on government policy.
The route to the 2008 financial crisis, and the economic problems that still plague us, runs straight through the economics discipline. And it's due not just to ideology; it's also about straightforward, old-fashioned money."
Peter Dormat noticed amazing similarity between medical researchers taking money from drug companies and economists. In case of medical researchers widespread corruption can at least be partially kept in check by rules of disclosure. Universities are being called out for their failure to disclose to public agencies the other, private grants researchers are pulling in. This is not perfect policing as the universities themselves get a cut of the proceeds, so that the conflict of interest exists but at least this is theirs too.
But there is no corresponding policy for economics. So for them there are not even rules to be broken. And this is not a bug, this is feature. In a sense corruption is officially institualized and expected in economics. Being a paid shill is the typical career of many professional economists. Some foundations require an acknowledgment in the published research they support, but that's all about “thank you”, not disclaimer about the level of influence of those who pay for the music exert on the selection of the tune. Any disclosure of other, privately-interested funding sources by economists is strictly voluntary, and in practice seldom occurs. Trade researchers can be funded by foreign governments or business associations and so on and so forth.
In this atmosphere pseudo-theories have currency and are attractive to economists who want to enrich themselves. That situation is rarely reflected in mainstream press. For example, there some superficial critiques of neo-classical economics as a new form of Lysenkoism (it enjoyed the support of the state) but MSM usually frame the meltdown of neo-classical economic theory something like "To all you corrupt jerks out there: shake off the old camouflage as it became too visible and find a new way misleading the masses...". At the same time it's a real shocker, what a bunch of toxic theories and ideologies starting from Reagan have done to the US economy.
That suggests that neo-economics such as Milton Friedman (and lower level patsies like Eugene Fama ) were just paid propagandists of a superficial, uninformed, and simplistic view of the world that was convenient to the ruling elite. While this is somewhat simplistic explanation, it's by-and-large true and that was one of the factors led the USA very close to the cliff... Most of their theories is not only just nonsense for any trained Ph.D level mathematician or computer scientist, they look like nonsense to any person with a college degree, who looks at them with a fresh, unprejudiced mind. There are several economic myths, popularized by well paid propagandists over the last thirty years, that are falling hard in the recent series of financial crises: the efficient market hypothesis, the inherent benefits of globalization from the natural equilibrium of national competitive advantages, and the infallibility of unfettered greed as a ideal method of managing and organizing human social behavior and maximizing national production.
I would suggest that and economic theory has a strong political-economic dimension. The cult of markets, ideological subservience and manipulation, etc. certainly are part of neo-classical economics that was influenced by underling political agenda this pseudo-theory promotes. As pdavidsonutk wrote: July 16, 2009 16:14
Keynes noted that "classical theorists resemble Euclidean geometers in a non Euclidean world who, discovering that in experience straight lines apparently parallel often meet, rebuke the lines for not keeping straight --as the only remedy for the unfortunate collisions. Yet in truth there is no remedy except to throw over the axiom of parallels to work out a non-Euclidean geometry. SOMETHING SIMILAR IS REQUIRED IN ECONOMICS TODAY. " [Emphasis added]
As I pointed out in my 2007 book JOHN MAYNARD KEYNES (Mentioned in this ECONOMIST article as a biography "of the master") Keynes threw over three classical axioms: (1) the neutral money axiom (2) the gross substitution axiom, and (3) the ergodic axiom.
The latter is most important for understanding why modern macroeconomics is dwelling in an Euclidean economics world rather than the non-Euclidean economics Keynes set forth.
The Ergodic axiom asserts that the future is merely the statistical shadow of the past so that if one develops a probability distribution using historical data, the same probability distribution will govern all future events till the end of time!! Thus in this Euclidean economics there is no uncertainty about the future only probabilistic risk that can reduce the future to actuarial certainty! In such a world rational people and firms know (with actuarial certainty) their intertemporal budget constrains and optimize -- so that there can never be an loan defaults, insolvencies, or bankruptcies.
Keynes argued that important economic decisions involved nonergodic processes, so that the future could NOT be forecasted on the basis of past statistical probability results -- and therefore certain human institutions had to be develop0ed as part of the law of contracts to permit people to make crucial decisions regarding a future that they "knew" they could not know and still sleep at night. When the future seems very uncertain, then rational people in a nonergodic world would decide not to make any decisions to commit their real resources -- but instead save via liquid assets so they could make decisions another day when the future seemed to them less uncertain.
All this is developed and the policy implications derived in my JOHN MAYNARD KEYNES (2007) book. Furthermore this nonergodic model is applied to the current financial and economic crisis and its solution in my 2009 book THE KEYNES SOLUTION: THE PATH TO GLOBAL PROSPERITY (Palgrave/Macmillan) where I tell the reader what Keynes would have written regarding today's domestic crisis in each nation and its international aspects.
Paul Davidson ghaliban wrote:July 16, 2009 15:34
I think you could have written a shorter article to make your point about the dismal state of economics theory and practice, and saved space to think more imaginatively about ways to reform.
A bit like biology, economics must become econology - a study of real economic systems. It must give up its physics-envy. This on its own will lead its practitioners closer to the truth.
Like biological systems, economic systems are complex, and often exhibit emergent properties that cannot be predicted from the analysis of component parts. The best way to deal with this is (as in biology) to start with the basic organizational unit of analysis - the individual, and then study how the individual makes economic decisions in larger and larger groups (family/community), and how groups take economic decisions within larger and larger forms of economic organization. From this, econologists should determine whether there are any enduring patterns in how aggregate economic decisions are taken. If there are no easily discernable patterns, and aggregate decisions cannot be predicted from a knowledge of individual decision-making preferences, then the theory must rely (as it does in biology) on computer simulations with the economy replicated in as much detail as possible to limit the scope for modeling error. This path will illuminate the "physiology" of different economies.
A second area of development must look into "anatomy" - the connections between actors within the financial system, the connections between economic actors within the real economy, and the connections between the real and financial economies. What are the precise links demand and supply links between these groups, and how does money really flow through the economic system? A finer knowledge of economic anatomy will make it easier to produce better computer simulations of the economy, which will make it a bit easier to study economic physiology.
In her interview What Exactly Is Neoliberalism Wendy Brown advanced some Professor Wolin ideas to a new level and provide explanation why "neoclassical crooks" like Professor Frederic Mishkin (of Financial Stability in Iceland fame) still rule the economics departments of the USA. They are instrumental in giving legitimacy to the neoliberal rule favoured by the financial oligarchy:
"... I treat neoliberalism as a governing rationality through which everything is "economized" and in a very specific way: human beings become market actors and nothing but, every field of activity is seen as a market, and every entity (whether public or private, whether person, business, or state) is governed as a firm. Importantly, this is not simply a matter of extending commodification and monetization everywhere-that's the old Marxist depiction of capital's transformation of everyday life. Neoliberalism construes even non-wealth generating spheres-such as learning, dating, or exercising-in market terms, submits them to market metrics, and governs them with market techniques and practices. Above all, it casts people as human capital who must constantly tend to their own present and future value. ..."
"... The most common criticisms of neoliberalism, regarded solely as economic policy rather than as the broader phenomenon of a governing rationality, are that it generates and legitimates extreme inequalities of wealth and life conditions; that it leads to increasingly precarious and disposable populations; that it produces an unprecedented intimacy between capital (especially finance capital) and states, and thus permits domination of political life by capital; that it generates crass and even unethical commercialization of things rightly protected from markets, for example, babies, human organs, or endangered species or wilderness; that it privatizes public goods and thus eliminates shared and egalitarian access to them; and that it subjects states, societies, and individuals to the volatility and havoc of unregulated financial markets. ..."
"... with the neoliberal revolution that homo politicus is finally vanquished as a fundamental feature of being human and of democracy. Democracy requires that citizens be modestly oriented toward self-rule, not simply value enhancement, and that we understand our freedom as resting in such self-rule, not simply in market conduct. When this dimension of being human is extinguished, it takes with it the necessary energies, practices, and culture of democracy, as well as its very intelligibility. ..."
"... For most Marxists, neoliberalism emerges in the 1970s in response to capitalism's falling rate of profit; the shift of global economic gravity to OPEC, Asia, and other sites outside the West; and the dilution of class power generated by unions, redistributive welfare states, large and lazy corporations, and the expectations generated by educated democracies. From this perspective, neoliberalism is simply capitalism on steroids: a state and IMF-backed consolidation of class power aimed at releasing capital from regulatory and national constraints, and defanging all forms of popular solidarities, especially labor. ..."
"... The grains of truth in this analysis don't get at the fundamental transformation of social, cultural, and individual life brought about by neoliberal reason. They don't get at the ways that public institutions and services have not merely been outsourced but thoroughly recast as private goods for individual investment or consumption. And they don't get at the wholesale remaking of workplaces, schools, social life, and individuals. For that story, one has to track the dissemination of neoliberal economization through neoliberalism as a governing form of reason, not just a power grab by capital. There are many vehicles of this dissemination -- law, culture, and above all, the novel political-administrative form we have come to call governance. It is through governance practices that business models and metrics come to irrigate every crevice of society, circulating from investment banks to schools, from corporations to universities, from public agencies to the individual. It is through the replacement of democratic terms of law, participation, and justice with idioms of benchmarks, objectives, and buy-ins that governance dismantles democratic life while appearing only to instill it with "best practices." ..."
"... Progressives generally disparage Citizens United for having flooded the American electoral process with corporate money on the basis of tortured First Amendment reasoning that treats corporations as persons. However, a careful reading of the majority decision also reveals precisely the thoroughgoing economization of the terms and practices of democracy we have been talking about. In the majority opinion, electoral campaigns are cast as "political marketplaces," just as ideas are cast as freely circulating in a market where the only potential interference arises from restrictions on producers and consumers of ideas-who may speak and who may listen or judge. Thus, Justice Kennedy's insistence on the fundamental neoliberal principle that these marketplaces should be unregulated paves the way for overturning a century of campaign finance law aimed at modestly restricting the power of money in politics. Moreover, in the decision, political speech itself is rendered as a kind of capital right, functioning largely to advance the position of its bearer, whether that bearer is human capital, corporate capital, or finance capital. This understanding of political speech replaces the idea of democratic political speech as a vital (if potentially monopolizable and corruptible) medium for public deliberation and persuasion. ..."
"... My point was that democracy is really reduced to a whisper in the Euro-Atlantic nations today. Even Alan Greenspan says that elections don't much matter much because, "thanks to globalization . . . the world is governed by market forces," not elected representatives. ..."
For the list of top articles see Recommended Links section
|I find an attempt to elevate academic finance and economics to sciences by using the word "scientism" to be bizarre. Finance models like CAPM, Black-Scholes and VAR all rest on assumptions that are demonstrably false, such as rational investors and continuous markets.|
Aug 20, 2019 | economistsview.typepad.com
likbez -> anne... August 04, 2019 at 04:14 PM
It is not about the strategy. It's about the agony. The agony of the US centered global neoliberal empire.
Trump and forces behind him realized that current set of treaties does not favor the preservation of the empire and allows new powerful players to emerge despite all institutionalized looting via World Bank and IMF and the imposition of Washington Consensus. The main danger here are Germany (and EU in general) and, especially, China.
The current neoliberal order failed to suppress China development enough to block her from becoming the competitor (and the second largest economy.)
That's why a faction of the USA elite decided to adopt "might makes right" policies (essentially piracy instead of international law) in a hope that it will prolong the life of the US-centered neoliberal empire.
As much as Trump proved to be inapt politician and personally and morally despicable individual (just his known behavior toward Melania tells a lot about him; we do not need possible Epstein revelations for that) he does represent a faction of the US elite what wants this change.
All his pro working class and pro lower middle class rhetoric was a bluff -- he is representative of faction of the US elite that is hell bent on maintaining the imperial superiority achieved after the collapse of the USSR, whatever it takes. At the expense of common people as Pentagon budget can attest.
That also explains the appointment of Bolton and Pompeo. That are birds of the feather, not some maniacs (although they are ;-) accidentally brought into Trump administration via major donors pressure.
In this sense Russiagate was not only a color revolution launched to depose Trump by neoliberal wing of Democratic Party and rogue, Obama-installed elements within intelligence agencies (Brennan, Comey, McCabe, etc.) , but also part of the struggle between the faction of the US elite that wants "muscular" policy of preservation of the empire (Trump supporters faction so to speak) and the faction that still wants to kick the can down the road via "classic neoliberalism" path (Clinton supporters faction so to speak.)
Aug 19, 2019 | www.bloomberg.com
The purpose of a corporation is to serve all of its constituents, including employees, customers, investors and society at large, the Business Roundtable said Monday in a statement. Dimon, the chief executive officer of JPMorgan Chase & Co., heads the group.
"While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders," the group said in the statement. "Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity."
The 181 signatories include BlackRock Inc.'s Laurence Fink, Bank of New York Mellon Corp.'s Charlie Scharf and the CEOs of several Wall Street banks, including Goldman Sachs Group Inc., Morgan Stanley and Moelis & Co. It also includes Amazon.com Inc. founder Jeff Bezos, the world's richest person.Fundamental Premise
The shift in corporate priorities comes as some politicians and critics question whether the fundamental premise of American capitalism should be revamped. Some executives also have complained that an outsize focus on share prices and quarterly results hamper their ability to build businesses for the long term.
The group's statement offers scant detail on how the commitments will be converted into action and presents no road map for getting there. Many companies vow to do good things but often resist releasing data to let others independently verify such promises. And it will fall on CEOs, who on average last no longer than six years, to convince fickle investors, including powerful activists, that shifting resources will pay off in the long term.
The idea that businesses exist primarily to benefit shareholders -- also known as shareholder primacy -- took hold in corporate America in the 1980s. In 1997, the Business Roundtable embraced the idea in a document outlining governance principles.
The concept has been criticized for leading to a fixation on short-term results and helping fuel the rapid increase in executive pay. Last year, public companies in the U.S. began disclosing the difference between their CEOs' compensation and that of their median workers. At S&P 500 firms, the average ratio is about 280-to-1, according to data compiled by Bloomberg.
Both Dimon and Fink have written open letters saying that chief executives should take on a larger responsibility for tackling societal matters and, at times, take stances on politically controversial topics.'Sensitive' Issues
"Stakeholders are pushing companies to wade into sensitive social and political issues -- especially as they see governments failing to do so effectively," Fink wrote this year. The message echoed a position he took in 2018 urging CEOs to make a more positive contribution to society. BlackRock oversees almost $7 trillion in assets.
In April, Dimon challenged fellow chief executives to get more involved in social causes and public-policy matters.
"In the past, boards and advisers to boards advised company CEOs to keep their head down and stay out of the line of fire," Dimon said in a letter to shareholders. "Now the opposite may be true. If companies and CEOs do not get involved in public-policy issues, making progress on all these problems may be more difficult."
-- With assistance by Michelle Davis, and Jenn Zhao( Updates with obstacles in sixth paragraph. )
Aug 19, 2019 | www.theamericanconservative.com
Is Big Necessarily Bad? Antitrust cannot be used as a cudgel based on size. There are other ways of whacking at corporate excess. By Marshall Auerback • August 19, 2019
Teddy Roosevelt with trust-busting stick, circa 1904. (Image: Library of Congress/Wikimedia Commons) When it comes to relations between consenting adults, size may not matter (or so one hears). But it's a different story in regard to companies and the politically fraught area of antitrust law.
Today, a number of policymakers , economists , and legal scholars connect a host of problems -- excessive wealth inequality, wage stagnation, political dysfunction, market distortions -- directly to the corporate "curse of bigness ," which they argue is a product of lax antitrust enforcement. But they may be misdiagnosing the cause of these diseases and, in so doing, offering up the wrong cure.
Instead of moving toward a new antitrust paradigm, we might do better to consider a more robust utility system of regulation that is "function-centric," rather than size-centric. In other words, regulation that restricts the range of corporate activities (e.g., structural separation so as to prevent companies like Amazon and Google from owning both the platform as well as participating as a seller on that platform), or the prices such companies can charge (as regulators often do for utilities or railways). These considerations would be "size neutral": they would apply independently of corporate size per se. Regulation, rather than antitrust, also better addresses other issues like privacy protection (via a national model that could replicate California's Consumer Privacy Act of 2018 ), labor abuses (it shouldn't matter whether workers are employed by Apple or mom-and-pop sweatshops), and controlling "fake news" dissemination (by placing social media companies under the purview of the Federal Communications Commission).
"Break 'em up" has great historical resonance in the United States. Yet one of the nation's earliest trust-busters, President Theodore Roosevelt, argued that "the remedy for [corporate] abuse was not mindlessly breaking up big firms, but preventing specific abuses by means of a strong national regulation of interstate corporations." Likewise, in the early days of the New Deal, his cousin, Franklin Delano Roosevelt, initially embraced the antitrust philosophy of Supreme Court Justice Louis Brandeis (who, like many of today's modern trust-busters, prioritized power and business structure over consumer welfare). Ultimately though, frustrated that the incessant focus on corporate concentration was hindering World War II efforts to mobilize greater industrial production, FDR concluded that optimal outcomes were more likely to be achieved via "prudent government oversight and using antitrust laws to police abuses -- not to break up every big company simply because it's big."Advertisement
After World War II, historian Richard Hofstadter noted a gradual public acceptance of big business . In large part, this was due "to the emergence of countervailing bigness in government and labor" that ultimately led to the "big three tripartite" model among government, business, and unions exemplified in the Treaty of Detroit agreement between General Motors and the United Auto Workers (UAW).
From the 1950s through the 1970s, "Tripartism" was exceptionally successful at promoting economic growth and high wages (the wage growth was explicitly linked to rising productivity in the Treaty of Detroit). Big unions flourished alongside growing conglomerates that emerged as the new face of corporate consolidation (a prime example being International Telephone and Telegraph -- ITT). Equally significant, as the economist Thomas Piketty observed in his sweeping account of rising inequality, Capital in the Twenty-first Century , a new wave of corporate consolidation did not exacerbate prevailing inequalities. To the contrary, this period coincided with a diminution of wealth inequality , as relative wealth gains for the top tier stabilized for the first time in decades.
That all changed in the 1980s with the rise of Ronald Reagan's market fundamentalist agenda. His presidency was characterized by a sustained attack on unions , cuts in public services, and the ascendancy of the doctrine of "shareholder capitalism," used to legitimize the establishment of SEC Rule 10b-18 . That rule engendered an explosion in share buybacks (until it was introduced, companies buying back their own shares was considered a form of stock manipulation). Rather than focusing on job-creating investment, corporate cash flow was thus directed toward stock repurchases to fatten executive compensation.
The legacy of Reagan's market fundamentalism persists today. It is the most cogent explanation we have for growing wealth inequality, wage stagnation, and reduced emphasis on corporate R&D.
This period also coincided with the rise of the "Bork Doctrine," when, citing Robert Bork, the Supreme Court asserted that the main focus of antitrust law should be on economic efficiency and consumer welfare, as opposed to granting the government broad discretion to shape the economy. That shift in priorities is a major source of the neo-Brandeisians' criticism of Bork's antitrust philosophy. It reflects their Jeffersonian vision of a social-economic order organized along the lines of small-scale businesses, with atomistic competition between a large number of equally advantaged units, in theory producing greater innovation and economic dynamism.
But that's a highly idealized vision that doesn't comport with reality. Our modern economy isn't comprised of village blacksmiths, yeoman farmers, and cobblers. A crucial component of the economy today is big business, including many large multinational corporations that operate globally. And it is questionable whether their size automatically equates to market power (in the sense of having the ability to manipulate prices at will and exclude competitors), especially in the context of a global economy featuring a multiplicity of competing national champions. Seldom do we hear calls to break up Detroit's "Big Three," despite global revenues in the hundreds of billions. Why? Because there is a widespread recognition that these companies face significant challenges in a global market dominated by similarly large competitors.
Contrary to popular myth, big companies, not small businesses, can be engines of growth and innovation, as Robert Atkinson and Michael Lind explore in their book Big Is Beautiful: Debunking the Myth of Small Business :
On virtually every meaningful indicator, including wages, productivity, environmental protection, exporting, innovation, employment diversity and tax compliance, large firms as a group significantly outperform small firms.
That insight parallels the scholarship of Joseph Schumpeter, the intellectual godfather of the economics of innovation, who showed that R&D spending and productivity increase with scale. Latterly, Schumpeter's insights have been validated by a recent study from Professors Ann Marie Knott and Carl Vieregger, who conclude (emphasis added):
Not only do large firms (using the U.S. Small Business Association definition of greater than 500 employees) conduct 5.75 more R&D in aggregate than small firms, they have 13% higher productivity with that R&D. However this merely captures the private returns to their R&D. A further benefit of large firm R&D is that it generates the spillovers upon which small firm innovation free-rides .
Size-centric antitrust proposals also ignore the increasing prevalence of economic network theory, which suggests that social networks like Facebook or search engines such as Google lend themselves to becoming natural monopolies in order to function optimally. Here again, function-centric regulation -- i.e., separation between the control of content and distribution -- makes more sense to rectify market abuse. And this could be achieved via utility-style regulation, as no less a figure than right-wing populist Steve Bannon has suggested , rather than creating a bunch of new mini-Facebooks or Googles via court-mandated break-ups (especially if the owners of the newly broken-up companies retain full control of algorithms to determine what people see in their News Feeds, what privacy settings they can use, and even what messages get delivered to news consumers, as Mark Zuckerberg does today ).
It is also the case that many businesses characterized by minimal levels of corporate concentration -- construction, education, entertainment, accommodation, food, business services, transportation, warehousing -- generally experience sub-standard productivity levels, sluggish growth, and low real wages, according to an INET-funded study by Professors Lance Taylor and Özlem Ömer. Working conditions are generally worse, and wages and employment benefits lower, as small business owners are often the first to protest increased regulation or "burdensome" mandates, such as health care provisions. The real point is not to beat up on small businesses, but simply to note that the abuses commonly ascribed to big business are just as, if not more, likely to manifest themselves in smaller industries less prone to corporate concentration.
What about the claim that corporate consolidation contributes to a corrosion of American democracy ? It is true that as companies get bigger, it maximizes their abilities to "pay to play," as Professor Thomas Ferguson asserts in his seminal work, Golden Rule . Ferguson says that powerful blocs of business elites, large and small, with durable (largely economic) interests, are a constant feature of American politics. All have an incentive to get bigger in order to maximize political leverage. That includes smaller businesses that scale up via trade associations to maximize the impact of their "political investment." But again, what is needed here is not an antitrust remedy, but a change in the "pay to play" rules so as to ensure that money and corporate scale have less of a polluting impact on the American polity.
So it may be time to reconsider the simplistic notion that "big is bad." Yes, we want a dynamic economy and a thriving democracy. But mindlessly breaking up big businesses may not be the best path to get us there.
Marshall Auerback is a market analyst and a research associate at the Levy Economics Institute at Bard College.
This article was supported by the Ewing Marion Kauffman Foundation.
I notice that this entire article only once uses the word "monopoly", which AFAIK was the entire point of America's antitrust laws. Instead the author chooses to focus on corporate size. Hence the article's title: "Is Big Necessarily Bad?"Jake Jaramillo • 9 hours ago • edited
That suggests that he is either missing the point of the antitrust laws or he's choosing to ignore it so as allow him to bathe large corporations in a rosy glow.
BTW, as an FYI, I notice that this article was supported by Ewing Marion Kauffman Foundation. As it happens that particular non-profit was founded by Ewing Marion Kauffman who also founded Marion Laboratories. As it happens, Marion Laboratories was later bought by Dow Chemicals, one of the top three chemical corporations.
That being the case, one can kinda see why they might support an article arguing that big corporations aren't "necessarily bad".The author might be right about attacking vertical domination, but it seems to me that an important shortcoming of his analysis is failure to define "bigness," except to cite someone else's definition as any company with more than 500 employees. Such a low bar prevents the author from seriously grappling with the issue of "bigness." Any discussion about whether or not "big is bad" must reckon with the extent to which the bigness in question creates industry consolidation. Potential oligopoly is seen by most analysts and economists as the major issue with "bigness." Oligopoly means loss of industry competition, and it is therefore oligopoly that is rightly the target of antitrust law.tweets21 • 8 hours agoInteresting article cover quite a scope of time. Am an American Ex pat working in Canada. In Canada to avoid total integration with the US aside from controlling the currency Canada has very successful Oligopolies . I see that with the US airline Industry. Oligopolies are mandated to work in concert with Government regulations, to retain their protected status.Biggest example in Canada is the extremely successful 5 big Banks. Our government doesn't have lawyers with the expertise to challenge the likes of Google, Facebook, etc.JPH • 7 hours agoDOJ should enforce its HHI regulation.Zsuzsi Kruska • 7 hours agoAntitrust laws aren't enforced because those corps. who are at fault pay generously for campaigns to ensure they aren't enforced. Besides, the SCOTUS made rulings in the past allowing monopolies, which is against the Constitution. But, the Constitution gets in the way of business and profits, doesn't it?Kent • 7 hours agoSize isn't the determining factor. It's competition. You need at least 5 companies in a product category to ensure that a pricing oligarchy won't be formed. I also agree on breaking up companies horizontally to ensure that they can't create platform monopolies. Competition is what drives innovation.kalendjay • 4 hours agoThere he goes again! with the charge that Reagan was an unabashed union buster, by way of what could be taken either as the classic push toward GOP monopolism, or nihilistic competition, take your pick -- we are not clear what the administration stood for by way of this article.ChineseDruid • an hour ago
Just who would defend the behavior of the Teamsters, which earned itself a forced trusteeship under NY attorney general Guiliani? Or PATCO, whose strike was illegal under federal law, which warranted the right to fire airline staff? Much criticism has been leveled against the reorganization of the trucking industry, whereby the elimination of freight tariffs and also of the mandate to force deadhead backhauling did lower wages and effectively bust union organizing. But this deregulation was actually initiated under Carter, and it did have the longterm effect of enlarging national carriers -- though that had not done Consolidated Freight much good in this century. Similarly, the creation of CSX under Reagan only followed a huge history of consolidations, mergers, and rail closures.
What of the villainous Robert Bork? In "The Antitrust Paradox", he raised the issue that "mush language" attends many legal rationales for government action, such as the notion that such and such action be "reasonable". We have heard all this again and again in field after field of American jurisprudence, and there is no reason for conservatives to disagree.
To this day, the granddaddy of bad antitrust law is the Leow's Theatre case. Had the chain simply been allowed to keep both its theaters and some of its block booking system, provided that fair access, booking, and payment be provided to film production competitors, the monopolism problem would have been solved. But rest assured, chain theaters could not avoid a massive pruning in the 50's.
I find it ironic that for all our solicitude for trust busting, corrupt unions escape scrutiny. The fact that they are largely organized along the lines of the former CPUSSR (that was progress in 1934),have carte blanche in siphoning dark money into political campaigns in contravention of most campaign laws, and have spent more effort colluding with employers in back deals to stifle dissenters within truly independent union forces than actually fighting corrupt corporate boards, says a lot.Everything big used to be incompatible with freedom - only look at Montesquieu or Rousseau.
If you want to have corporations, then you resign from individual freedom.
Aug 17, 2019 | www.counterpunch.orgThe United States witnessed three mass shootings in one week recently in California, Texas, and Ohio. There have been more than 250 mass shootings so far in 2019, more than one a day. This year in America, more than 33,000 shooting incidents have killed more than 8,700 people.
America is the richest country in the world, but it has more than half a million homeless and 28 million people without health insurance – out of a population of around 325 million. The U.S. infant mortality rate places it 33rd out of wealthiest 36 nations.
... ... ...People from other industrialized countries must think that the United States has simply gone insane. It is a nation of terrible extremes: grotesque wealth and horrific poverty, brilliant minds and widespread ignorance, high rates of volunteerism and endemic violence. America seems to be suffering from some kind of bipolar disorder with pockets of manic energy and large areas of deep depression.
It would be tempting to argue that America is only suffering from a bout of temporary insanity. But mass shootings, gross economic inequality, and corruption didn't begin when Donald Trump became president. He has made matters worse, to be sure. But these trends are longstanding.
So, why do Americans put up with such violence, economic inequality, and political nonsense?
... ... ...Moreover, more than half of Americans have never traveled to another country. One in ten hasn't even gone outside the state in which he or she was born. Since most of the news about other countries is negative, Americans naturally believe that life is more dangerous outside their borders. They haven't actually seen what it's like in other countries, so there's no way for them to compare the craziness of life in America with life anywhere else.
Of course, plenty of countries experience considerable violence, economic inequality, and political corruption. But they are usually not powerful industrialized nations.
In the 2019 Global Peace Index , for instance, the United States ranks 128 th in the world, between South Africa and Saudi Arabia. Kosovo, Haiti, and Bangladesh all rank higher than America. Part of the reason that the United States ranks so poorly is the amount of military violence that the country inflicts around the world – through war, arms sales, and military bases. But the high homicide rate in the United States also dragged its score down.
The GINI index measures a country's economic inequality. The United States, according to OECD figures , is fourth from the bottom of the wealthiest countries in the world. Only Chile, Turkey, and Mexico have greater income inequality after taxes and transfers.
On corruption issues, the United States has generally been in the top twenty in terms of transparency. But in 2018, it dropped six places to number 22 in the Transparency International rankings. Here, the influence of the Trump administration has been significant. The problem is not ordinary corruption like bribery. Rather, Trump is challenging the very foundations of the rule of law. He promised to "drain the swamp" of political influence-peddling in Washington, DC. But he has only made the nation's capital swampier.
Individuals with mental disorders can seek professional help. They can take medications and enter psychotherapy. They can check themselves into a hospital.
But what happens when a country is crazy?
Aug 16, 2019 | www.unz.com
J. Gutierrez , says: August 15, 2019 at 7:05 pm GMTAn interesting take on American Society today by Chris Hedges .
Aug 16, 2019 | www.unz.com
Ahoy , says: August 15, 2019 at 5:32 pm GMT@ J. Gutierrez
In my eyes the NWO has lost its stamina in its fight to conquer the world. They started with the dismemberment of Yugoslavia during degenerate Clinton times and continued with the so called Color Revolutions. That imitation of human being, General Clark, told us it will be 7 countries in 7 years. That would take care of the M.E. After two successes, Libya and Irak, the Russians gave their ass in their hands in Syria.
Let's take a look at South America. In Brazil they deposed Rousef and installed that nincampoop Bolsonaro. To me that victory has all the characteristics of Disney cartoon. Venezouela now. It was January 2018 they told us they are going to invade to restore democracy (here we laugh) and human rights (more laughter) and they are still invading. They know if they ever dare the whole South America will be up in arms and that is too big of a bite to chew.
Add to this a 24 trillion debt economy with 15% of the Americans homeless and their dream just fizzled.
Mexico is humanistic and civilised and when something dear to them is threatened THEY RUN AS ONE TO RING THE CHURCH BELLS. They will not only survive they will come out victorious.
Some other time we will take a look at this monstrous attack against the white race in Europe through engineered invasion of Afroasians. Planning and management of Soros. The scum of the earth.
Enjoy your Harley!
Aug 15, 2019 | www.nakedcapitalism.com
Sound of the Suburbs , August 13, 2019 at 5:25 am
What was the problem with Classical Economics?
The Classical Economists soon noticed those at the top don't do anything economically productive, but maintained themselves in luxury and leisure through the hard work of everyone else.
They couldn't miss it as the European aristocracy never did a stroke of real work.
"The labour and time of the poor is in civilised countries sacrificed to the maintaining of the rich in ease and luxury. The Landlord is maintained in idleness and luxury by the labour of his tenants. The moneyed man is supported by his extractions from the industrious merchant and the needy who are obliged to support him in ease by a return for the use of his money. But every savage has the full fruits of his own labours; there are no landlords, no usurers and no tax gatherers." Adam Smith
Economics was a big problem for the powerful vested interests of the 19th century and it was always far too dangerous to be allowed to reveal the truth about the economy.
How can we protect those powerful vested interests at the top of society?
The early neoclassical economists hid the problems of rentier activity in the economy by removing the difference between "earned" and "unearned" income and they conflated "land" with "capital".
They took the focus off the cost of living that had been so important to the Classical Economists to hide the effects of rentier activity in the economy.
The landowners, landlords and usurers were now just productive members of society again.
William White (BIS, OECD) talks about how economics really changed over one hundred years ago as classical economics was replaced by neoclassical economics.
He thinks we have been on the wrong path for one hundred years.
This was the old switcheroo.
Economics, the time line:
- Classical economics – observations and deductions from the world of small state, unregulated capitalism around them
- Neoclassical economics – Where did that come from?
- Keynesian economics – observations, deductions and fixes for the problems of neoclassical economics
- Neoclassical economics – Why is that back?
We thought small state, unregulated capitalism was something that it wasn't as our ideas came from neoclassical economics, which has little connection with classical economics.
On bringing it back again, we had lost everything that had been learned in the 1930s and 1940s, by which time it had already demonstrated its flaws.
Sound of the Suburbs , August 13, 2019 at 5:48 am
In the second half of the 20th century, the Mont Pelerin society developed the neoliberal ideology from neoclassical economics, under the impression that capitalism was a self-stabilising system that doesn't need regulation.
Their expectations were rather different from the small state, unregulated capitalism that had been observed and documented by the Classical Economists in the 19th Century.
"The interest of the landlords is always opposed to the interest of every other class in the community" Ricardo 1815 / Classical Economist
"But the rate of profit does not, like rent and wages, rise with the prosperity and fall with the declension of the society. On the contrary, it is naturally low in rich and high in poor countries, and it is always highest in the countries which are going fastest to ruin." Adam Smith / Classical Economist
Their belief in the markets came from neoclassical economics, which doesn't consider the elements that ensures markets don't reach stable equilibriums; debt and the money creation of bank loans.
Richard Vague has studied many of those 19th century financial crises in his book "A Brief History of Doom" and charts the rollercoaster progress of 19th century small state, unregulated capitalism.
A self-stabilising system it is not.
Sound of the Suburbs , August 13, 2019 at 5:33 am
Why do policymakers think debt isn't a problem?
Ben Bernanke is famous for his study of the Great Depression and here it is discussed in the Wall Street Journal.
"Theoretically, neither deflation nor inflation ought to affect long-run growth or employment. After a while, people and businesses get used to changing prices. If prices fall, eventually so will wages, and the impact on profits, employment and purchasing power will be neutral. Borrowers suffer during deflation because their debts are fixed in value, but creditors benefit because the dollars they get back will buy more. For the economy as a whole, deflation ought to be a wash."
What has Ben Bernanke got wrong? He thinks banks are financial intermediaries.
Our knowledge of privately created money has been going backwards since 1856.
Credit creation theory -> fractional reserve theory -> financial intermediation theory
"A lost century in economics: Three theories of banking and the conclusive evidence" Richard A. Werner
It went backwards between Milton Freidman and Ben Bernanke.
Milton Freidman used fractional reserve theory, which was better than financial intermediation theory, but still wrong.
This is why his Monetarism didn't work.
He though banks lending and the moony supply were controlled by central bank reserves, but they aren't.
Brooklin Bridge , August 13, 2019 at 7:06 am
I like the title. Also, this is one of those cases where the interviewer brings quite a lot to the table as well as the author. An excellent introduction and a well carried/developed near metaphor as in, nail on the is a head.
Daniel Romig , August 13, 2019 at 7:24 am
That was a logical thesis to investigate. It seems strange that it has remained out of sight for so long until Mr. Vague's research and analysis.
The student debt in the USA is currently at $1.5 trillion. That is about 7% of GDP – and growing. I wonder how this may affect the economy in the US going forward.
As Yogi Berra reminds us, "You can observe a lot by watching."
Thank you for observing, Mr. Vague.
Samuel Conner , August 13, 2019 at 9:07 am
I don't think it has been "out of sight" so much as "in sight, but ignored". The relation of private debt to economic downturns has been noticed by others. Irving Fisher in the 20th Century, Steve Keen today come to mind.
The connection between "over-capacity" and "inability to service" may be new.
I would like to see analysis like this subjected to peer review; I think that there must be at least a few journals sympathetic to heterodox approaches to economics that would give a new synthesis like this a fair review process. Going "directly to the people" via popular writing raises a small concern in my mind.
Telee , August 13, 2019 at 2:23 pm
Steve Keen mathematized the Minsky Hypothesis. The results could be displayed in three dimensions. The graphs showed that when private debt was included in the calculations, the recession in 2007 was accurately predicted. Interestingly, there is a period of moderation which is followed by a rapid crash. During this period of moderation Bernanke was saying that all the indicators showed that the economy was in good shape. Of course he didn't consider private debt.
Steve H. , August 13, 2019 at 7:43 am
Some points of discussion, I'm not mad if disproven:
: Is the 2.5 Quadrillion dollars in derivatives considered debt? Or is the ability to create derivatives what drives the excess lending?
: Is the ability to generate excess debt a function of the fractional reserve system, and thus mostly a benefit for robbers who own banks? The Templars couldn't generate excess debt, they needed gold on hand to pay the notes, but wasn't there increased trade from their system, and thus general benefit?
vlade , August 13, 2019 at 8:19 am
The stupid sums on derivatives are notional principals, and usually grossed up. If I have a swap with 10m notional with you, it could be worth anything (and most likely the only debt exposure is any margin-call amount, which would be on 10m swap trivial), but would add 20m to that dumb number.
I can easily enough generate almost any number for the notional principal w/o increasing the risk to the system (for example by creating any number of equal-but-opposite trades between two parties which have a netting agreement)
I can equally (a bit harder, as it requires some thinking) do a few "well placed" derivatives with notionals in say few billions (but nicely levered) that can sink the whole system.
In a full reserve system there's no debt, hence no question of "excess debt". As an aside, "fractional reserve system is a myth". Bank lending is constrained only by capital, not by any reserves (cf number of banking systems that don't even have any rules on reserves).
Steve H. , August 13, 2019 at 2:31 pm
Thank you, Vlade.
Thorstein's Ghost , August 13, 2019 at 8:01 am
I have not read Mr. Vague's book. However, I am curious as to whether he adds anything to the work of Steve Keen, who predicted the 2007-09 financial crisis, and Hyman Minsky. See, for example, Keen's "Can We Avoid Another Financial Crisis?" (2017).
Adam Eran , August 13, 2019 at 8:00 pm
Looks like a nice validation of Keen's (and Michael Hudson's) work. That's fine with me, although a nod in their direction certainly looks warranted since private debt was what led Keen to predict the Great Recession (and win the Revere Prize for doing so).
Hudson's work on ancient debt jubilees exactly parallels Vague's.
vlade , August 13, 2019 at 8:09 am
I can't remember where I wrote it before.
Debt is the only working time machine mankind invented. But the conservation-over-time still holds.
Technically, for any individual, over their lifetime integral of (income + debt destruction) >= integral(expenses+ debt creation) [I'm ignoring cases where debt can be inherited]
So are we heading for a crisis? Right now I(income + debt destruction) < I(expenses + debt creation) for a large number of indivduals over their lifetime. So unless their income raises dramatically (expenses for them are often way less discretionary), yes we are, as the debt destruction will have to compensate.
But to guess the timing – well, that very much depends on the aggregate of those individuals.A trigger that would further reduce income or increase expense (across the population) would make it more probable. A small but not sufficient increase in income (across the population) would postpone it.
John , August 13, 2019 at 8:13 am
"The student debt in the USA is currently at $1.5 trillion."
Thanks to some skillful intervention with the somnolent Congress this debt cannot be discharged in bankruptcy. That seems to fly in the face of Mr. Vague's conclusions while redounding to the benefit of the rentier financial class.
Carla , August 13, 2019 at 9:10 am
@ John -- Please make everyone you know aware that Democrat candidate for president Joe Biden holds a great deal of responsibility for student debt not being dischargeable in bankruptcy. This is only one of his high crimes and misdemeanors. Don't let anyone forget!
Bugs Bunny , August 13, 2019 at 10:06 am
That's only one of many reasons that Biden should be defeated. Here's a really good explanation of how he helped remove educational loans (nearly all of them, not only student loans) from discharge in bankruptcy.
Telee , August 13, 2019 at 7:16 pm
Biden also strongly supported the Iraq War preventing any opposition views to testify in his committee. Also a strong supporter of NAFTA anf the TTTP. ( Trump will hammer on this if he runs against Biden.) His cooperation with southern segregationists resulted in the unequal drug penalties that fed the prison industrial complex he supported. He had mutiple committee meeting to rail against black crime when it was expedient. He threw Anita Hill under the bus and thus aided in putting Clarence Thomas on the Supreme Court. He says he's a union man as he goes to Comcast, a union buster, for financial aid. He is known as a representative working for the credit card companies. etc. What's not to like if you're a corporate democrat?
Steve Ruis , August 13, 2019 at 2:35 pm
Duh. That was exactly the purpose. That bankruptcy exempt law for student loans was passed based upon falsehoods. Its actual purpose was to enslave the college educated youth (make them debt slaves) so that they don't go on a rampage like they did in the 1960's and 70's vis-a-vis the Vietnam War.
John Merryman. , August 13, 2019 at 8:29 am
I think part of the problem is that we treat money as a store of value, as well as a medium of exchange.
As a medium, it is a contract, with one side an asset and the other a debt, so in order to store the asset, similar amounts of debt have to be created.
This results in a centripedial effect, as positive feedback draws the asset to the center of the system, while negative feedback pushes the debt to the edges.
Since money and finance serve as the value circulation mechanism, this is like the heart telling the hands and feet to go suck dirt, because they don't get any blood.
A medium and a store are distinct functions. Blood is a medium, fat is a store. Roads are a medium, parking lots are a store.
As a medium, we own money like we own the section of road we are using, or the beer passing through our bodies. It's functionality is in its fungibility.
If we store value in healthy communities, we wouldn't need banks to mediate every relationship.
The irony of our individualistic culture, is it leaves us in our atomized cocoons, allowing more effective top down control and a parasitic feedback mechanism. Sort of like The Matrix.
susan the other` , August 13, 2019 at 6:05 pm
good description of the way an ME and a SoV work against each other; I can never think through what I'm sure is this very contradiction in terms. thanks.
Bobby Gladd , August 13, 2019 at 9:43 am
Sound like an interesting book. Just ordered it. I am reminded of "This Time is Different: 700 years of financial folly."
I worked in subprime risk modeling & mgmt during 2000 – 2005 . We made successive record profits every year of my tenure.
I quit to go back to health care analytics. It was too slimy. I knew it was not gonna end well.
Chauncey Gardiner , August 13, 2019 at 10:15 am
Appears to build on the work of economists Hyman Minsky and Steve Keen. Not as concerned with developments in "Asia" (China), as there seems to be a policy willingness there to substitute state money for private sector debt, and to allow currency depreciation as an adjustment mechanism for the implicit debt writedowns. The policy also plays into China's exports-driven macro model. Similar to the US government and central bank "foaming the runway" for the banks and large corporations in the aftermath of the 2008 financial crisis.
Contemplating the role of compound interest in private sector debt growth in a period of low economic growth. Recent rapid growth of leveraged loans and junk bonds to fund corporate stock buybacks, negative real interest rates to push up financial asset and real estate prices/collateral values, and a lax regulatory environment appear to support an intentional policy of excessive growth in private sector debt. Whether the GFC is entirely in the rearview mirror or is till unfolding in terms of ultimately leading to systemic change also remains open IMO, although neoliberal policies remain firmly entrenched at this time.
Summer , August 13, 2019 at 11:40 am
The part about the financial sector, including housing, being the main components of US "industrial policy" shows the country as whole isn't taking the first advice financial advisors usually give for stability: DIVERSIFY ..
And yet again here is another book/article on the US economy that says nothing about defense spending.
Synoia , August 13, 2019 at 12:20 pm
US Defense spending is not debt. The MMT discussions state that clearly.
One test for "debt" is a simple question: Who can demand the debt be paid?
In the case of USG spending, the only party who could "call the debt" is the USG, and a single party cannot be both debtor and creditor on a debt, that is: cannot owe oneself money.
Summer , August 13, 2019 at 1:59 pm
"Debt" is invested, however, and defense spending is a big use of it and still – boom and bust.
Adam Eran , August 13, 2019 at 8:06 pm
Well all government spending is debt if it spends currency. The dollars are debt. Your checking account is debt too to the bank. When you write a check, you're assigning a portion of the bank's debt to the payee. Dollars are just checks made out to "cash" in fixed amounts. They appear in the Fed's books a liability, too.
What are we owed for a dollar? Answer: relief from a dollar's worth of (inevitable) tax liability.
Back to the original post: It's even ambiguous whether defense spending is consumption. After all, the internet is a product of DARPA (the "D" is for "Defense"). Marianna Mazzucato has a nice TED talk about government as innovator.
tegnost , August 13, 2019 at 12:22 pm
" In both cases, the result is about 16% growth to GDP over 15 years. But in the second case, you don't have a financial crisis."
also in the second case there are not foreclosures and repossessions whereby concentrated financial power confiscates what they sold so they can sell it again by the way where does that activity (repos and foreclosures) go in the calculation of GDP
Adam Eran , August 13, 2019 at 8:06 pm
Susan the other` , August 13, 2019 at 2:51 pm
Gosh. Where has Mr. Vague been? If this isn't the understatement of the century, I don't know what is. Even dear old Ordoliberal Wolfgang Schaeuble said right up front: "We are overbanked." Steve Keen is still fighting with Krugman about the significance of private debt. And to imply that we have an unspoken "industrial policy" that uses real estate to get us out of a slow patch begs the question. It is not industrial policy, it is the blatant chickenshit avoidance of industrial policy. But never mind all that, the sea change Mr. Vague is avoiding is that industrial manufacturing is being drastically trimmed back, limited, maybe even rationed by country for all we know. To forgive debts won't really cut it. Not that we shouldn't do it. We should simply because debt service is nearly impossible these days. We need to have massive fiscal infusions; money spent wisely to improve civilization and save the environment. Please Mr. Vague. You're more like Mr. Vacuous.
Another Amateur Economist , August 13, 2019 at 11:22 pm
No. It is the "Destruction of Industry Policy." Why make and build, when institutionalized theft, graft, and fraud have become more profitable?
p. Fitzsimon , August 13, 2019 at 3:09 pm
" .industrial policy, even though it was largely unstated: namely, support for the financial and real estate sectors"
I would add the agricultural sector to government supported industry.
Generalfeldmarschall von Hindenburg , August 13, 2019 at 3:09 pm
The brother needs to have a look a Portland, Oregon. Overcapacity, a housing bubble and a homeless crisis all at once. It's bound to crash. Yet there're so many boomers retiring from the first wave of the Tech Era (the folks whose awesome ideas and disruption gave us Dot-Bomb. So they've run up the price of beer in a town famous for craft brewing to unaffordability. They never seem to pay the price.
Jack Parsons , August 13, 2019 at 4:43 pm
The earliest worldwide financial crisis that I'm aware of was the Habsburg silver crisis. Fascinating story.
Tim , August 13, 2019 at 8:46 pm
Bush Junior tightened the Bankruptcy laws in his final term before the great recession. I still don't think that was coincidence.
The smart people with all the money DO know this is how economics works, and execute their strategies on their behalf accordingly. The rest of us, get the idiot's guide to the galaxy to work with.
none , August 15, 2019 at 12:07 am
"Debt, the first 5000 years" by David Graeber is on my list of probably-good books that I'm unlikely to get around to reading. Is that similar to this one?
Aug 14, 2019 | www.nakedcapitalism.com
Yves here. Quelle surprise! Economists engage in groupthink, which sounds a little less bad if you call it "ideology".
By Mohsen Javdani, Associate Professor of Economics, University of British Columbia – Okanagan Campus and Ha-Joon Chang, Professor, University of Cambridge. Originally published at the Institute for New Economic Thinking website
Mainstream (neoclassical) economics has always put a strong emphasis on the positivist conception of the discipline, characterizing economists and their views as objective, unbiased, and non-ideological. This is still true today, even after the 2008 economic crisis exposed the discipline to criticisms for lack of open debate, intolerance for pluralism, and narrow pedagogy.  Even mainstream scholars who do not blatantly refuse to acknowledge the profession's shortcomings still resist identifying ideological bias as one of the main culprits. They often favor other "micro" explanations, such as individual incentives related to academic power, career advancement, and personal and editorial networks. Economists of different traditions do not agree with this diagnosis, but their claims have been largely ignored and the debate suppressed.
Acknowledging that ideology resides quite comfortably in our economics departments would have huge intellectual implications, both theoretical and practical. In spite (or because?) of that, the matter has never been directly subjected to empirical scrutiny.
In a recent study , we do just that. Using a well-known experimental "deception" technique embedded in an online survey that involves just over 2400 economists from 19 countries, we fictitiously attribute the source of 15 quotations to famous economists of different leanings. In other words, all participants received identical statements to agree or disagree with, but source attribution was randomly changed without the participants' knowledge . The experiment provides clear evidence that ideological bias strongly influences the ideas and judgements of economists. More specifically, we find that changing source attributions from mainstream to less-/non-mainstream figures significantly reduces the respondents' reported agreement with statements. Interestingly, this contradicts the image economists have of themselves, with 82% of participants reporting that in evaluating a statement one should only pay attention to its content and not to the views of its author.
Moreover, we find that our estimated ideological bias varies significantly by the personal characteristics of economists in our sample. For example, economists' self-reported political orientation strongly influences their ideological bias, with estimated bias going up as respondents' political views move to the right. The estimated bias is also stronger among mainstream than among heterodox economists, with macroeconomists exhibiting the strongest bias. Men also display more bias than women. Geographical differences also play a major role, with less bias among economists in Africa, South America, and Mediterranean countries like Italy, Portugal, and Spain. In addition, economists with undergraduate degrees in economics or business/management tend to show stronger ideological biases.
We give more details about our methodology and findings in the following sections, but first let us anticipate some of the conclusions and implications. Theoretically, the implications are upsetting for the positivist methodology dominating the neoclassical economics. As Boland (1991) suggests, "[p]ositive economics is now so pervasive that every competing view has been virtually eclipsed." Yet, the strong influence of ideological bias on views among economists that is evident in our empirical results cannot be reconciled with it.
Practically, our results imply that it is crucial to adopt changes in the profession that protect academic discourse, as well as the consumers of the economic ideas, from the damaging impacts of ideological bias. In fact, there exists growing evidence that suggests value judgements and political orientation of economists affect not just research ( Jelveh et al. 2018 , Saint-Paul 2018 ), but also citation networks ( Önder and Terviö 2015 ), faculty hiring ( Terviö 2011 ), as well as economists' positions on positive and normative issues related to public policy (e.g. Beyer and Pühringer 2019 ; Fuchs, Krueger and Poterba 1998 ; Mayer 2001 ; van Dalen 2019 ; Van Gunten, Martin, and Teplitskiy 2016 ). It is therefore not a long stretch to imagine that ideological bias could play an important role in suppressing plurality, narrowing pedagogy, and delineating biased research parameters in economics.
One important step that helps identify the appropriate changes necessary to minimize the influence of ideological biases is to understand their roots.
As argued by prominent social scientists (e.g. Althusser 1976 , Foucault 1969 , Popper 1955 , Thompson 1997 ), the main source of ideological bias is knowledge-based, influenced by the institutions that produce discourses. Mainstream economics, as the dominant and most influential institution in economics, propagates and shapes ideological views among economists through different channels.
Economics education, through which economic discourses are disseminated to students and future economists, is one of these important channels. It affects the way students process information, identify problems, and approach these problems in their research. Not surprisingly, this training may also affect the policies they favor and the ideologies they adhere to. In fact, there already exists strong evidence that, compared to various other disciplines, students in economics stand out in terms of views associated with greed, corruption, selfishness, and willingness to free-ride (e.g. Frank and Schulze 2000 , Frank et al. 1993 and 1996 , Frey et al. 1993 , Marwell and Ames 1981 , Rubinstein 2006 , Want et al. 2012 ). 
Another important channel through which mainstream economics shapes ideological views among economists is by shaping the social structures and norms in the profession. While social structures and norms exist in all academic disciplines, economics seems to stand out in at least several respects, resulting in the centralization of power and the creation of incentive mechanisms for research, which in turn hinder plurality, encourage conformity, and adherence to the dominant (ideological) views.
Our own exposure to different parts of this social structure while working on this project has in fact been an unpleasant yet eye-opening experience, and a testament to dominant biases in the discipline that strongly impede critical thinking, new perspectives, and plurality. We have been threatened, accused, and insulted for simply asking an important and legitimate question. We have also had first-hand experience with the Top Five journals in economics and some of their (associate) editors' exertion of their strong prejudiced views, which is often disguised under the vail of "inevitably subjective nature of editors' decision-making process," which is supported by the absolute and unaccountable power that is at their disposal. In some cases, the decision regarding our submission blatantly lacked professionalism and respect for plurality of views.
Our world today is characterized by critical issues that economics has a lot to say about, such as inequality, austerity, the future of work, and climate change. However, relying on one dominant discourse which ignores or isolates alternative views will make the economics profession ill-equipped to engage in balanced conversations regarding these issues. This also makes the consumers of economic ideas skeptical about economists and the views and policies they advocate for. We believe that addressing the issue of ideological bias in economics first requires economists to find out about their own biases. Persistent denial of these biases is going to be more harmful than being aware of their presence and influence, even if mainstream economists do not necessarily change their views. Moreover, the economics profession needs to have an in-depth introspection and a real and open debate about the factors underpinning these biases, including economics training and social structures within the discipline that centralize power, encourage group thinking and conformity, dampen innovative thinking and creativity, and hinder plurality.
Examining issues such as the impact of bias, prejudice, or discrimination on individual views and decisions is very challenging, given the complex nature of these types of behaviour. This has given rise to a field experimentation literature in economics that has relied on the use of deception -- for example, through sending out fictitious resumes and applications, to examine the prevalence and consequences of discrimination against different groups in the labor market.  We take a similar approach, namely using fictitious source attributions, in order to investigate the effect of ideological bias on economists (See Section 4 in our online appendix for a more detailed discussion on the use of deception in economics). More specifically, we employ a randomized controlled experiment embedded in an online survey. Economists from 19 different countries were invited to complete an online survey where they were asked to evaluate fifteen statements from prominent economists on a wide range of topics. We received just over 2,400 responses, with the majority of responses (around 92%) from academics with a PhD degree in economics. As reported in our online appendix , our sample includes a very diverse group of economists from a diverse set of institutions. While all participants received identical statements in the same order, source attribution for each statement was randomly changed without the participants' knowledge . For each statement, participants either received the name of a mainstream economist as the source (Control Group), or an ideologically different less-/non-mainstream economist (Treatment 1), or no source attribution (Treatment 2). See Table A8 in our online appendix for a complete list of statements and sources.
The Findings, in Detail
Our analysis of the experimental results reveals several important findings. First, examining the probability of different agreement levels for each statement as well as their comparative degree of consensus (using relative entropy index derived from information theory), we find evidence of clear dissent among economists on the wide variety of topics evaluated (see Figure 1 below). Given that our statements either deal with different elements of the mainstream economics paradigm -- including its methodology, assumptions, and the sociology of the profession -- or issues related to economic policy, the significant disagreement evident in our results highlights the lack of paradigmatic and policy consensus among economists on evaluated issues.
Figure 1: Probability of different agreement levels – By statement
Note: See Table A8 in our online appendix for a complete list of statements and sources.
Second, we find evidence of a strong ideological bias among economists. More specifically, we find that for a given statement, the agreement level is 7.3% (or 22% of a standard deviation) lower among economists who were told that the statement was from a less-/non-mainstream source. Examining statements individually also reveals that in all but three statements, agreement level drops significantly (both quantitatively and statistically, ranging from 3.6% to 16.6%) when the source is less-/non-mainstream.
For example, when a statement criticizing "symbolic pseudo-mathematical methods of formalizing a system of economic analysis" is attributed to its real source, John Maynard Keynes, instead of its fictitious source, Kenneth Arrow, the agreement level among economists drops by 11.6%. Similarly, when a statement criticizing intellectual monopoly (i.e. patent, copyright) is attributed to Richard Wolff, the American Marxian economist at the University of Massachusetts, Amherst, instead of its real source, David Levine, professor of economics at the Washington University in St. Louis, the agreement level drops by 6.6%.
Interestingly, these results stand in sharp contrast with the image economists project of themselves in our survey. In an accompanying questionnaire that appears at the end of the survey, a strong majority of participants (around 82%) agreed that in evaluating a statement, one should only pay attention to its content, rather than its author. Only 18% of participants agreed that both the content of the statement as well as the views of the author matter, and only a tiny minority (around 0.5%) reported the views of the author should be the sole basis to evaluate a statement.
Third, we find that economists' self-reported political orientation strongly influences their views. More specifically, our results suggest that even when we focus on statements with mainstream sources attributed to them , there exists a very significant difference in average agreement level among economists with different political orientations. For example, for a given statement, the average agreement level among economists self-identified as left is 8.4% lower than those self-identified as far left. This already large difference widens consistently as we move to the far right, reaching a difference of 19.6% between the far right and the far left, which is an increase of 133%. This strong effect of political orientation on economists' evaluation of our statements, which does not change after controlling for a wide set of observed characteristics, is another clear manifestation of ideological bias.
The effect of political orientation on economists' views is even more drastic when we examine how changes in attributed sources affects economists with different political orientations. More specifically, for those on the far left, altering the sources only reduces the average agreement level by 1.5%, which is less than one-fourth of the overall effect of 7.3% we discussed before. However, moving from the far left to the far right of the political orientation consistently and significantly increases the effect of changing the source to a 13.3% reduction in agreement level, which is almost 8 times (780%) larger compared to the far left. Interestingly, this is despite the fact that relative to the far left, those at the far right are 17.5% more likely to agree that in evaluating a statement one should only pay attention to its content.
Fourth, our results uncover striking differences by gender. More specifically, we find that the estimated ideological bias is 44% larger among male economists as compared to their female counterparts, even after controlling for potential gender differences in observed characteristics including political orientation and political/economic typology. Moreover, our results highlight a startling difference between male and female economists in their perception of gender problems in the profession. When faced with the statement " Unlike most other science and social science disciplines, economics has made little progress in closing its gender gap over the last several decades. Given the field's prominence in determining public policy, this is a serious issue. Whether explicit or more subtle, intentional or not, the hurdles that women face in economics are very real. ", the agreement level was a whopping 26% higher among female economists than among their male peers.
In addition, when participants were told that the statement was made by the left-wing British feminist economist Diane Elson (rather than the real source, Carmen Reinhart, a mainstream economist at Harvard), male economists showed ideological biases -- their agreement level fell by 5.8%. Interestingly, however, it stayed unchanged for female economists. This seems to suggest that the gender problem in economics is so severe that female economists, who exhibited ideological biases on many other issues (although less than did their male colleagues), put aside their biases in this particular case and focused on the content of the statement.
The discussion around the gender problem in economics has recently taken the center stage. During the recent 2019 AEA meeting, and in one of the main panel discussions titled "How can economics solve its gender problem?" several top female economists talked about their own struggles with the gender problem in economics. In another panel discussion, Ben Bernanke, the current president of the AEA, suggested that the discipline has "unfortunately, a reputation for hostility toward women ." This is following the appointment of an Ad Hoc Committee by the Executive Committee of the AEA in April 2018 to explore "issues faced by women [ ] to improve the professional climate for women and members of underrepresented groups." AEA also conducted a climate survey recently to "provide more comprehensive information on the extent and nature of these [gender] issues." It is well-understood that approaching and solving the gender problem in economics first requires a similar understanding of the problem by both men and women. However, our results suggest that unfortunately there exists a very significant divide between male and female economists in their recognition of the problem.
Fifth, we find systematic and significant heterogeneity in our estimated effect of ideological bias by country, area of research, country where PhD was completed, and undergraduate major, with some groups of economists exhibiting little or no ideological bias and some others showing very strong bias.
For example, we find that economists with a PhD degree from Asia, Canada, Scandinavia, and the U.S. exhibit the strongest ideological bias. On the opposite end we find that economists with PhD degrees from South America, Africa, Italy, Spain, and Portugal exhibit the smallest ideological bias. Similarly, our results suggest that there is the smallest ideological bias from economists whose main area of research is history of thought, methodology, heterodox approaches; cultural economics, economic sociology, economic anthropology, or economic development. On the other hand, we find that economists whose main area of research is macroeconomics, public economics, international economics, and financial economics are among those with the largest ideological bias.
We also find that undergraduate training in economics has a strong effect on our estimated effect of ideological bias. We find that those economists with an undergraduate major in economics, or business/management, exhibit the strongest bias, while those who studied law; history, language and literature; or anthropology, sociology, and psychology show no ideological bias. These results are consistent with the growing evidence that suggests economic training, either directly or indirectly, induces ideological views in students (e.g. Allgood et al. 2012 , Colander and Klamer 1987 , Colander 2005 , Rubinstein 2006 ).
Scholars hold different views on whether economics can be a "science" in the strict sense and be free from ideological biases. However, perhaps it is possible to have a a consensus that the type of ideological bias that could result in endorsing or denouncing an argument on the basis of (one's interpretation of) its author's views rather than its substance is unhealthy and in conflict with scientific tenor and the subject's scientific aspiration, especially when the knowledge regarding rejected views is limited .
Some economists might object that economists are human beings and therefore these biases are inevitable. But economists cannot have their cake and eat it too! Once you admit the existence of ideological bias, the widely-held view that "positive economics is, or can be, an 'objective' science, in precisely the same sense as any of the physical sciences" (Friedman 1953) must be rejected.
Furthermore, the differences we find in the estimated effects across personal characteristics such as gender, political orientation, country, and undergraduate major clearly suggest that there are ways to limit those ideological effects, and ways to reinforce them.
Our finding that those with an undergraduate degree in economics exhibit the strongest ideological bias highlights the importance of economic training in shaping ideological views. In doing so, our study contributes to the literature on economic education, suggesting that ideology can be at least limited by changes in the curricula at earlier stages.
Rubinstein (2006) argues that "students who come to us to 'study economics' instead become experts in mathematical manipulation" and that "their views on economic issues are influenced by the way we teach, perhaps without them even realizing." Stiglitz (2002) also argues that "[economics as taught] in America's graduate schools bears testimony to a triumph of ideology over science."
Economics teaching not only influences students' ideology in terms of academic practice but also in terms of personal behavior. Colander and Klamer (1987) and Colander (2005) survey graduate students at top-ranking graduate economic programs in the U.S. and find that, according to these students, techniques are the key to success in graduate school, while understanding the economy and knowledge about economic literature only help a little. This lack of depth in knowledge acquired, not only in economics but in any discipline or among any group of people, makes individuals lean more easily on ideology. Frank et al. (1993) similarly highlight the importance of economics training in shaping behavior among students by criticizing the exposure of economics students to the self-interest model in economics where "motives other than self-interest are peripheral to the main thrust of human endeavor, and we indulge them at our peril." They also provide evidence that such exposure does have an impact on self-interested behavior.
But education is not the only problem: social structures and norms within the profession also deeply influence economists' adherence to dominant ideological views.
For example, in his comprehensive analysis of pluralism in economics, Wright (2019) highlights several features of the discipline that make the internal hierarchical system in economics "steeper and more consequential" compared to most other academic disciplines. These features include: (1) particular significance of journal ranking, especially the Top Five, in various key aspects of academic life including receiving tenure ( Heckman and Moktan 2018) , securing research grants, invitation to seminars and conferences, and request for professional advice; (2) dominant role of "stars" in the discipline ( Goyal et al. 2006 , Offer and Söderberg 2016 ); (3) governance of the discipline by a narrow group of economists ( Fourcade et al. 2015 ); (4) strong dominance of both editorial positions and publications in high-prestige journals by economists at highly ranked institutions ( Colussi 2018 , Fourcade et al. 2015 , Heckman & Moktan 2018 ; Wu 2007 ); and the strong effect of the ranking of one's institution, as a student or as an academic, in career success ( Han 2003 , Oyer 2006 ).
As another example, in a 2013 interview with the World Economic Association, Dani Rodrik highlights the role of social structure in economics by suggesting that "there are powerful forces having to do with the sociology of the profession and the socialization process that tend to push economists to think alike. Most economists start graduate school not having spent much time thinking about social problems or having studied much else besides math and economics. The incentive and hierarchy systems tend to reward those with the technical skills rather than interesting questions or research agendas. An in-group versus out-group mentality develops rather early on that pits economists against other social scientists." Interestingly, a very similar picture of the profession was painted in 1973 by Axel Leijonhufvud in his light-hearted yet insightful article titled " The life among the Econ ."
It is hard to imagine that the biased reactions we find in our study only emerge in a low-stakes environment, such as our experiment, without spilling over to other areas of academic life. After all, as we discussed at the beginning, there already exists growing evidence which suggests that the political leanings and the personal values of economists influence different aspects of their academic lives. It is also not a long stretch to imagine that such ideological biases impede economists' engagement with alternative views, narrow the pedagogy, and delineate biased research parameters. We believe that recognizing their own biases, especially when there exists evidence suggesting that they could operate through implicit or unconscious modes, is the first step for economists who strive to be objective and ideology-free. This is also consistent with the standard to which most economists in our study hold themselves. To echo the words of Alice Rivlin in her 1987 American Economic Association presidential address, "economists need to be more careful to sort out, for ourselves and others, what we really know from our ideological biases."
 Several scholars have highlighted the connection between ideological views and the lack of plurality in economics and the failure of the profession to predict the 2008 crisis, or to even have an honest and in-depth retrospective explanation that would help develop accountable counter-measures against future crises (e.g. Barry 2017 ; Cassidy 2009 ; Dow 2012 ; Freeman 2010 ; Heise 2016 ; Lawson 2009 ; Stilwell 2019 ). There are also those who believe the 2008 crisis was not predictable, but fault the profession, as Colander (2010) puts it, "for failing to develop and analyze models that, at least, had the possibility of such a failure occurring" (e.g. Cabalerro 2010 ; Colander et al. 2013 ).
 Even if this relationship is not strictly casual, it suggests that there exists something about economic education that leads to a disproportionate self-selection of such students into economics.
 See Bertrand and Duflo (2017) and Riach and Rich (2002) for a review. Also see Currie et al. (2014) as another example of experimental audit studies with deception.
Ideology is Dead! Long Live Ideology! |<img src="http://b.scorecardresearch.com/p?c1=2&c2=16807273&cv=2.0&cj=1" />
Cripes , August 14, 2019 at 4:49 am
20 years ago Dr Sam Tsemberis conducted a double-blind trial of chronically homeless mentally ill people in an effort to learn whether being housed first led to better medical outcomes then placing barriers of compliance before getting housed would produce.
Happily, the common sense proposition that having a secure roof improves people's health or medication adherence was proven, and the concept of Housing First as a best practice is accepted today.
Economics is always political economy no matter how hard they try to pretend its algebra.
Paul O , August 14, 2019 at 5:43 am
I read this elsewhere yesterday. Seems Econ mags were not keen to publish or link to it :-)
The Rev Kev , August 14, 2019 at 6:15 am
If ideology is dead then good riddance to it. I have seen and read about too many ideologues that have caused massive damage and deaths over the centuries and economics is no different. Personally I am of the school of thought of doing things in an empirical way and ignoring labels but just seeing what works. If it works, adopt it. If it does not, try something else. The economics of today does not do that. It does not work. It never saw the 2008 crisis coming and it has never proposed and backed reforms so that it will not happen again. It is used to justify a world economy that is causing climate change as it refuses to include most factors into their equations. I find it fascinating too how modern economics makes use of labels to stop discussions of possible paths to explore. Ideological labels has itself proven a huge hindrance. Here is what I mean.
"We should have health care for all."
"That is socialism that!"
"Well I guess that we can't do that then!
I think that Blair Fix's article "No, Productivity Does Not Explain Income" ( https://www.nakedcapitalism.com/2019/08/no-productivity-does-not-explain-income.html ) shows you how modern economists work. You juggle around processes like you do mathematical formulas and expect that it still reflects the real world. In scientific discussion you throw out a theory in a journal. Ideally it should be reproducible in the real world and should be picked apart for any flaws in data or reasoning. But like in Blair Fix's article. the outcome is designated first and then you work you way back to justify it. It fails blind tests like mentioned here which shows it's flawed processes. In Washington DC there is the Victims of Communism Memorial but I do think that there should also be a Victims of Neoliberalism Memorial to reflect current economic thought. In the former there is the Goddess of Democracy statue as a centerpiece. For a statue for the Victims of Neoliberalism I would suggest another statue but based on the acronym BOHICA.
@pe , August 14, 2019 at 7:09 am
The more you see yourself as beyond ideology, the more likely it is that you are a victim of ideology. That's what the post shows: it's the very fields such as business management that see themselves as non-ideological, "common sense" and empirical which are the most ideological, least common sense and least empirical.
If you are aware of your bias, you can minimize (but not eliminate) those affects. But if you believe that you have *perfect* vision, no measurement can show you that you have an astigmatism.
Remember, Obama and Merkel see themselves as pragmatists -- but an objective observer can be assured of finding deep ideological biases and assumption underlying their thought process.
Amfortas the hippie , August 14, 2019 at 8:54 am
the position of Ignorance .Socratic Perplexity is hard.
but i reckon it' the only way to avoid the mental traps this talks about.
I'm the only one i know in meatspace that even attempts to begin an investigation there("I know that i don't know").
the idea that economics is just like Physics was always suspect, and i think it's pretty amazing that it's taken this long and this many economic disasters to get to the point that the idea of econ=hard science is challenged more or less in the open.
I'd add to this that i figure that the break in Philosophy, early in the last century, between Anglo-American and "Continental" probably precedes and enables this strange phenomena in economics(logical positivism, etc avoiding all that messy humanity attempting to shoehorn everything into a neat equation)
there's a similar phenomenon in a lot of the Humanities anthropology, for instance: taking into account the inherent and largely unconscious bias of the anthropologist embedded with the "savages" he's studying.
"Orthodoxy is Unconsciousness"-Orwell
Mark , August 14, 2019 at 7:33 am
A general observation: Economics without ideology or politics is only a rather peculiar way of using math. Without a reference what positive or negative actually means it is impossible to render jugdement or make policy. While economic outcomes are at the same time always political outcomes and vice versa. That is why the discipline used to call itself political economy.
About the experiment: If I understand it correctly all participants receive the questions only once. How then is it possible to attribute a specific answer towards bias regarding the source? Given that the questions are not of a clear 2+2=4 varietiy but at least somewhat open. Intuitively it seems far more likely that the specific answer is determined by the respondents own beliefs than by their bias regarding the source.
Bobby Gladd , August 14, 2019 at 8:18 am
"The willingness to indulge in ideological thinking -- that is, in thinking that by definition is not one's own, which is blind to experience and to the contradictions that arise when broader fields of knowledge are consulted -- is a capitulation no one should ever make. It is a betrayal of our magnificent minds and of all the splendid resources our culture has prepared for their use."
Robinson, Marilynne. What Are We Doing Here? (p. 2). Farrar, Straus and Giroux. Kindle Edition.
diptherio , August 14, 2019 at 8:39 am
Towards the end of my final year of econ education I pointed out to a professor that the claim that economics should be a positive science, as opposed to a normative one, was itself a normative claim and hence self-contradictory. He looked at me like I was a crazy person and he was one of the 'leftists' in the department.
a different chris , August 14, 2019 at 9:30 am
Haha are you sure that the source of "crazy person" look was your view itself, or rather was it that in your young naivete you spoke what anybody who needs to put food on the table as a working economist would not dare?
m sam , August 14, 2019 at 11:56 am
Huh. So ideology influences our thinking even when we think it doesn't. So in other words water really is wet after all.
m sam , August 14, 2019 at 11:58 am
(Apologies, this was meant as a top level post)
Eclair , August 14, 2019 at 12:16 pm
I had a similar experience, diptherio. It was at the beginning of semester picnic, and one of the profs was holding forth on how the mathematical and analytical methodology would allow us to find the solutions to business questions. Probably because I had drunk too much wine, I piped up, but don't we first have to define what are the critical questions? Deafening silence.
diptherio , August 14, 2019 at 12:48 pm
Yes, questions like "how do we squeeze more out of our workers?" and "how can we crappify our product while simultaneously raising the price?"
diptherio , August 14, 2019 at 9:07 am
It is crazy, is it not, that "Life among the Econ" is still locked behind a paywall, despite being written 46 years ago. Thankfully, there is sci-hub .
Carey , August 14, 2019 at 3:46 pm
Maybe this is it?
T.town Tom , August 14, 2019 at 10:22 am
Reminds me of my counselor journey when therapist became aware of the blinders and prejudices that one's theories of behavior imposed (good & bad) on clients. The admonition became, "don't marry your theory" which another fellow revised that to "it's best only to flirt with your theory."
A friend of mine was an IT Director for a large Insurance company. After the crash in '08, he said in one meeting an executive said "you know why we employ Economists, to lend credibility to the Astrologers"
funemployed , August 14, 2019 at 10:25 am
The fact that this article has a reason to exist at all shows how poorly educated our highly trained economists are. It's not just that they reject the better portion of the core concepts and practices of the humanities and social sciences as being somewhere between useless and harmful. It's also that, as this article illustrates without quite saying, pretenses aside, most economists are worse than clueless with regards to the basics of conducting research in the "hard" sciences.
For family blog's sake, they don't even know how to pretend to be scientists. I'm not practicing researcher, but I know enough about research methods and questions to be pretty sure that robust empirical positivist economic research should look a lot more like something from the medical sciences than like something out of a cut rate theoretical physics or math journal. That would have serious epistemological problems of it's own, but sheesh, at least it might be mildly convincing to people with a modicum of a liberal arts education who couldn't be bothered to look under the hood.
The only thing that shocks me more than the shoddyness of work from "superstar" economists is their undying faith that their methods make them experts not just on economics, but on basically anything that you can slap a mathematical model on.
Steve Ruis , August 14, 2019 at 10:43 am
What economics lacks is an arbiter. In the physical sciences, nature will bitch slap anyone getting out of line. Economists need to come up with an agreed-upon set of test or natural experiments or something that constitutes independent feedback on the merit of an idea. There is nothing more important for the future of the discipline than this.
diptherio , August 14, 2019 at 12:53 pm
Well, the historical data refutes the Phillip's Curve but I bet they still teach that. 2008 was a natural experiment that refuted the Efficient Market Hypothesis, as well as the idea that the Federal Reserve could stop a major economic catastrophe through monkeying with interest rates but I'm sure those things are still being taught. Which is to say that economics does not lack an arbiter -- rather, most economists simply refuse to give it any credence.
Synoia , August 14, 2019 at 11:37 am
Given that theories in economics are not testable, an application of group think would result in "everybody was predicting that," and the consequent "who could have know" blame avoidance, coupled with the economist selecting the analytic method that best confirmed the answers the management wanted.
The only thing missing is a display of the set of Chrystal Balls.
Do Economists speak truth to power, or just confirm what power wants?
PKMKII , August 14, 2019 at 1:04 pm
Ideology is like accents, it's easy to fall into thinking that other people have them, but your voice/worldview is just "normal".
nothing but the truth , August 14, 2019 at 6:49 pm
in the real world, not saying what the client/boss/thesis advisor expects you to say is a severely career and bank account limiting move.
more so in humanities like law, economics which are closely tied to advising the powerful.
anon y'mouse , August 14, 2019 at 6:53 pm
i'm just going to leave this here, shall i?
the rest of the social scientists at least test their theories against these standards (or make an appearance of doing so). econ seems to get around them by use of "definitions" so specific that in the end they are describing tautologies.
John Rose , August 14, 2019 at 10:07 pm
An interesting study to supplement this one is of funding sources for economics departments and the extent to which the funding is tied to hiring and model building. Then reanalize the date in this study for correlations with the influence of funding sources.
Aug 15, 2019 | economistsview.typepad.com
im1dc , August 14, 2019 at 02:10 PMSpeaker Pelosi finally is hitting Moscow Mitch hard, let's hope she also remembers to hit him often after today...likbez -> im1dc... , August 14, 2019 at 10:21 PM
"Pelosi refers to McConnell as 'Moscow Mitch'"
By Cristina Marcos...08/14/19...01:09 PM EDT
"Speaker Nancy Pelosi (D-Calif.) on Wednesday called Senate Majority Leader Mitch McConnell (R-Ky.) "Moscow Mitch" while attacking him for blocking House Democrats' legislation, including election security measures."...I like "Moscow Mitch" nickname. It reflects that depth of the split between two factions of the US elite. The equivalent for Pelosi would probably be to call her "Insurance industry prostitute." That means war propaganda mode: anybody who does not fully conform to the classic neoliberal dogma is now Russian stooge and anti-Semite (attack on Corbin and his faction in the UK)
Now one can probably understand Russiagate (among other things) as both of "Hail Mary" pass to unify those two factions on the base of common external enemy (Russophobia or, better, Russophenia does represent the lowest common denominator between two parties), as well as the attempt to misdirect people away from the fact that Trump's election represents an irreconcilable split in the US elite.
Trump faction which can roughly be described as one related to extractive and heavy manufacturing industries (energy, agriculture, mining, construction, steel, aluminum industries, etc.) went to war against FIRE sector, media and tech sectors. Currently they are undergunned and undermanned: MSM and intelligence agencies control is in the hands of the New Class. "Trumpists" can rely only on military intelligence and some MSM outlets (Fox). Moreover Trump himself was quickly neutered and now represents a shadow (or caricature) of former, election time, self.
But still he was able to unleash trade war with China which really hurt opposing faction of the elite.
Also "Trumpists" have the intensity and ferocity of people who fight for the right cause (or at least against well-defined enemy -- classic neoliberalism), which is lacking in "classic neoliberals" camp. They also have (temporary and tactical) support of the resurgent nationalist movement. The latter is the natural result of more then 40 year on neoliberal domination (if we count from Carter, who and not Reagan was the first neoliberal president and who started Wall Street deregulation.)
That's why the color revolution was launched against Trump camp (nothing personal here, just business) by Dems who represent those three sectors politically. They do not want to lose political power. Which is completely understandable, but let then eat cakes does not work.
So the real danger for "Clintonists" now is that tech monopolies like Google will be split and neutered and some investment banks who were too cozy to Clintons might soon have problems.
In this sense it is prudent to view Elisabeth Warren with her anti-Wall Street stance as a variation of Trump theme (Trump very quickly folded and became kind of parody on Obama). Which means that she might have a chance.
im1dc , August 14, 2019 at 02:38 PMI apologize for posting yet another crazy conspiracy story being spread by Trump Supporter Mediaim1dc -> im1dc... , August 14, 2019 at 02:41 PM
...read this to see how truly crazy the Right Reality is...
Moscow Mitch fits right in with these loonies...'I know the truth, I'm protecting you, THEY are out to get me, The truth will come out you'll see, it's a secret conspiracy of the Left', yada, yada, yada
"James O’Keefe’s Google ‘Whistleblower’ Loves QAnon, Accused ‘Zionists’ of Running the Government"
'The former YouTube software engineer believes Google is now trying to “off” him'
by Will Sommer...08.14.19...3:56PM ET
"Right-wing provocateur James O’Keefe published his latest video on tech giants on Wednesday, touting an interview with former YouTube software engineer and self-proclaimed “whistleblower” Zach Vorhies. In the video, Vorhies claims that Google’s search algorithms are riddled with political bias, and touted a cache of internal Google files he alleges prove his case.
Vorhies complains that Google doesn’t surface conspiracy theory websites like InfoWars in one of its news search algorithms. He insists that his information is so valuable that he has a credible fear that Google could be “trying to off me.”
“Some say that you’re a hero, some are going to say that you have extreme moral courage,” O’Keefe told the former Googler in the video.
“I always thought that when the time came to do the right thing, in a big way, that I would always be the one that stood up and did the right thing,” Vorhies replied.
What O’Keefe’s video leaves out, though, is that his much-hyped insider is not as credible as he claims. On social media, Vorhies is an avid promoter of anti-Semitic slanders that banks, the media, and the United States government are controlled by “Zionists.” He’s also pushed conspiracy theories like QAnon, Pizzagate, and the discredited claim that vaccines cause autism.
On Wednesday, O’Keefe defended Vorhies on Twitter. “Not every source is a perfect angel,” he tweeted. “Good journalists know this is true.” Vorhies and Google didn’t respond to requests for comment.
On his Twitter account, @Perpetualmaniac, Vorhies repeatedly attacks Jewish people and accuses them of a wide range of crimes. (Both O’Keefe and his group, Project Veritas, promoted Vorhies’s Twitter account in tweets on Monday.)
He even alleges that “Zionists” killed conservative publisher and O’Keefe mentor Andrew Breitbart, who died of heart failure in 2012.
“It’s very simple, either you go along with the zionists or you end up like Andrew Breitbart,” Vorhies wrote in January.
In a May tweet, Vorhies accused Israel of plotting the 9/11 attacks, and encouraged Twitter users to look up 9/11-related conspiracy theory content, providing no evidence of his claims.
“Israel and the zionist cabal planned 9/11 and its going to all come out,” Vorhies wrote."..l."the Right Reality" ought to be 'the Right's Reality'
Aug 12, 2019 | economistsview.typepad.com
likbez -> anne... Monday, August 12, 2019 at 07:40 PMFred C. Dobbs , August 12, 2019 at 07:37 PM
Degradation of the elite is probably inevitable with the degradation of the social system that ensured their rise -- neoliberalism.
As in Roman saying: "Those whom the gods would like to destroy they first make mad".
But the deep, existential crisis of neoliberalism is real and is not going away, no matter how many times you chant Russia, Russia, Russia. Or China, China, China.
"This country is filled with a patronage network of well off established people including Democrats who believe everything's fine as it is and are willing to shut their eyes to what's not working – the financial crisis of the working class, the racism underlying the for profit prison system and immigration system, the horrific endless regime change wars and the massive deregulation of banks on Bill Clinton's watch and much more, including the Climate Crisis."
And even more lemmings of the "rentier class" just check their account in Vanguard or Fidelity and are satisfied when they are rising.
There are serious arguments in favor of viewing "Russophenia" as a defensive reaction on the crisis on neoliberalism which provides an easy explanation of the country ills.
In this sense it is similar to the propaganda of Iraq war, which was also designed as the kludge to cement cracks in the US society -- as in "war is the health of the state" ( although the desire to expropriate Iraq oil was strong too )
Mark Thomason , August 12, 2019 at 10:34
Like the Wolfowitz explanation of the Iraq War, Russiagate is the idea around which varied interests can be organized. Cold Warriors like to hate on Russia. It justifies arms spending and their own importance. Clintonistas need an excuse to distract from her being a loser. The DNC needs an excuse for manipulating the candidate selection in favor of donor interests. "Moderates" need a distraction from their ongoing refusal to address the interests of voters.(It's Niall...)likbez , August 12, 2019 at 07:54 PM
No, this isn't the fall of Rome https://www.bostonglobe.com/opinion/2019/08/12/this-isn-fall-rome/34Uco0HivEVG8w0IZ7lpII/story.html?event=event25 via @BostonGlobe
Niall Ferguson - August 12
"A republic, madam -- if you can keep it." That was supposedly Benjamin Franklin's reply to a woman who asked him the result of the Constitutional Convention after it adjourned, in 1787.
Each generation of Americans frets that they will be the ones who fritter the republic away. At least once every decade, it is the sad lot of some journalist to draw strained parallels between the state of the nation and the last days of the Roman Republic. Since the election of Donald Trump in 2016, this has become more like an annual ritual. ...Fred,
I am afraid that nothing, or very little is left to preserve.
If anything "Russophobia" (Or Russophenia, to be exact) is the sign that the US neoliberal elite feels that it is losing the level of control they are accustomed since Carter. They are panicking and are ready to the slide of governance model from the current "inverted totalitarism" model toward a more repressive regime.
Witch hunts are always a sign of "tightening the screws" by the ruling elite.
Although the question whether the postwar democratic republic model of governance (with the New Deal as the cornerstone in the USA) is compatible with the existence of Wall Street oligarchy and powerful intelligence agencies which serve them as much if not more then the state was probably answered in November, 1963.
Aug 08, 2019 | economistsview.typepad.com
anne , August 06, 2019 at 05:45 AMhttps://voxeu.org/article/global-market-power-and-its-macroeconomic-implications
June 28, 2018
Global market power and its macroeconomic implications
By Federico Diez, Daniel Leigh and Suchanan Tambunlertchai
The rise in the market power of large firms is assumed to affect economic activity, but measuring either market power or its effects is challenging. Based on firm-level data for 74 countries, this column shows that market power has increased around the world, driven mostly by 'superstar' firms. Higher markups are initially associated with increasing investment and innovation, but the reverse is true when market power becomes too strong. The share of income paid to workers also declines with rising market power.
Aug 05, 2019 | economistsview.typepad.com
anne , August 02, 2019 at 09:57 AMhttp://cepr.net/data-bytes/jobs-bytes/jobs-2019-08Christopher H. said in reply to anne... , August 02, 2019 at 10:51 AM
August 2, 2019
Economy Adds 164,000 Jobs in July, Employment Rate Hits New High for Recovery
By Dean Baker
Total hours in manufacturing is down by 0.2 percent over the last year.
The Bureau of Labor Statistics reported that the economy added 164,000 jobs in July, with the employment-to-population ratio (EPOP) inching up to 60.7 percent, a new high for the recovery. The unemployment rate was unchanged at 3.7 percent. There were downward revisions of 41,000 to the prior two months' data, bringing the average rate of job growth for the last three months to 140,000.
The big job gainers in July were professional and technical services, which added 30,800 jobs, and health care, which added 30,400 jobs. The former is slightly above the 25,000 average of the last 12 months, while the latter is somewhat below the average of 33,800.
The goods-producing sector fared poorly in July. Mining and logging lost 5,000 jobs. Coal mining was especially hard hit, losing 800 jobs, which is 1.5 percent of employment in the industry. Construction added just 4,000 jobs, well below its average of 16,800 over the last year.
Manufacturing added 16,000 jobs, slightly above its average gain of 13,100, but this was accompanied by a decline of 0.3 hours in the length of the average workweek. The index of aggregate hours in manufacturing is now down by 0.2 percent over the last year. For production workers, it is down by 0.7 percent.
Manufacturing wages have also lagged. The average hourly wage is up just 2.5 percent over the last year. With the decline in hours, the average weekly wage in manufacturing is up just 1.0 percent over the last year.
Restaurants added 15,400 jobs, down from an average of 21,100 over the last year. Hotel employment fell by 5,200, possibly reflecting the drop in foreign tourism. Retail employment fell 3,600, bringing its drop to 59,900 (0.4 percent of total employment) over the last year.
Employment in insurance jumped 11,400 in July, compared to an average of just 2,800 over the last year. There was also an anomalous jump in local education employment of 11,700, likely reflecting changes in the timing of the school year.
Year-over-year wage growth was up slightly at 3.2 percent, but the annualized rate of wage growth comparing the last three months (May, June, July) with prior three months (February, March, April), is just 2.8 percent.
... ... ...
Involuntary part-time employment fell by 363,000 and is now well below its prerecession share of employment. By contrast, voluntary part-time employment is lower in the first seven months of 2019 than the year-round average for 2018. Voluntary part-time had jumped in 2014, following the implementation of the ACA, as workers were no longer as dependent on employers for health insurance. However, it is now falling as a share of total employment.
Another discouraging item is a drop of 0.9 percentage points in the share of unemployment due to quits. The current 13.8 percent share is low given the 3.7 percent unemployment rate and suggests workers are reluctant to quit jobs without a new job lined up.
On the whole, this is clearly a positive employment report. However, it does indicate job growth is slowing and it is not clear that wage growth is picking up steam.no wage gains b/c capital has dominated laborJohnH -> Christopher H.... , August 02, 2019 at 02:39 PMA legacy of 'free' trade deals, pitting US labor against slave labor abroad while the profiteers stuck their windfall profits into tax havens offshore.John Dixon -> JohnH... , August 02, 2019 at 08:40 PMLol, free trade my ass. US has been doing "free trade" since 1934. John, my advice, stop the sheet. The entire goods part of the economy crested in 1979 and that has little to do with trade, considering pre 1934 economy had vast inequality, even worse in some respect than now.
That is what happens when the rest of the world recovers from war. You either do free trade and develop a financial stranglehold,, or socialize the means of production and consume less.Your free lunch posts sicken me.
Aug 05, 2019 | economistsview.typepad.com
Fred C. Dobbs said in reply to ken melvin... , August 04, 2019 at 09:29 AM(Are NRA members this suicidal?)
There are more gun suicides
than gun homicides in America
@voxdotcom - Nov 14, 2018
Nearly 23,000 people died by firearm suicide in 2016.
Gun homicides get far more attention in the popular press, but most gun deaths are the result of suicide. In 2016, the last year for which the CDC provides numbers, 22,938 people committed suicide by firearm, while 14,415 people died in gun homicides. ...
Aug 05, 2019 | economistsview.typepad.com
anne -> anne... , August 04, 2019 at 03:28 PMlikbez -> anne... , August 04, 2019 at 10:28 PM
We won the Cold War...
[ Thinking through this Brad DeLong post, I am left with the same feeling I had after reading "The End of History" by Francis Fukuyama. History did not end with the division of the Soviet Union and evidently neither did the Cold War since the United States from at least as early as the presidency of George Bush was treating Russia as though the Cold War was continuing and this continued with Obama and Trump and now China is being openly included though this too can be traced easily back to the Clinton presidency.
DeLong is wrong, the Cold War is unfortunately not over and won. ]> We won the Cold War...anne -> anne... , August 04, 2019 at 05:02 PM
I would not be so glib.
IMHO both major parties in the Cold war lost and the USA is just another loser like now defunct the USSR. It is China and Germany which won the Cold War, emerging as two major economic (and in case of China political) powers.
The USSR was a theocratic state, a self-destructing utopia which nevertheless served a very useful role -- as a protection mechanism against cannibalistic instincts of the USA elite.
The key here is that after its dissolution the USA elite stated looting its own people. Which they were afraid of doing while the USSR was present of the world arena.
But Bolshevism was dead after WWII and eventually Soviet Nomenklatura (and first of all KGB brass) changed sides and adopted neoliberalism, privatizing the country resources. The USA helped in this process (bribing considerable part of the elite and first of all Party and KGB elite including some members of Politburo), but the writing was on the wall.
But after that the stupidity of the USA neoliberal elite ruled supreme. Instead of cultivating former USSR as a strategic ally by adopting something like Marshall plan, a war criminal and sex addict Bill Clinton pursued the short sited policy of trying to loot and kick a Russia into the vassal state sowing the dragon's teeth.
Looting Russia after the dissolution (via Harvard mafia; http://www.softpanorama.org/Skeptics/Pseudoscience/harvard_mafia.shtml ) closed the opportunity of having strategic ally and eventually created a determined adversary. Which will patiently wait when due to its own stupidity the USA will show the vulnerable side and then strike.
While after the dissolution of the USSR most people in the USSR were favorably disposed toward the USA, now the situation drastically changed. ( see http://euromaidanpress.com/2016/05/31/why-americans-are-stupid-according-to-russians/ )
And that alone is a huge geopolitical defeat of a war criminal (by Nuremberg standards https://en.wikipedia.org/wiki/Nuremberg_principles) Bill Clinton and his administration making him one of the most stupid and destructive USA president in the country history.
He essentially adopted British empire stance toward Russia. Now we have emerging potential alliance of Russia and China which complicates the efforts for the preservation of the USA-centered global neoliberal empire. The USA no longer can dictate it will against this alliance and that creates additional cracks in the empire façade visible in how EU reacts to China tariffs and Iran sanctions.
The USA dominance will not evaporate in one year or even in a decade, but it is in decline and now is really tested by China. Trump dysfunctional attempt to fight for the perseveration of the empire on three fronts (against Russia, China and Iran) is not very successful, to say the least.
And people whom he hired ( or who were hired by his handlers) are just a continuation of the line of Cold War warriors from three previous administration (starting from unforgettable Madeleine "not so bright" Albright). That's a real gallery of dinosaurs, if you ask me. Looks like Washington elite lives in its own kingdom of illusions and this echo chamber became completely disconnected with the reality. Attempt to push despicable and corrupt stooges of neoliberal status quo like Kamala Harris as a Democratic Party candidate in 2020 is just another manifestation of the same trend.
Also "neoliberal greed" (TM) destroyed the country manufacturing and without strong manufacturing capabilities research capabilities are hampered.
For example, the USA neoliberals managed substantially undermine the USA lead in IT and hardware.
Also using primarily financial instruments to ensure its dominance is a sign of the empire in decline. The same it true about the existence of huge parasitic, rent oriented finance. That also suggests that the dollar dominance can't last forever.
Much depends when the regime of "cheap oil" (let's say below $100 per barrel) ends. In any case, even with $50-$60 oil the secular stagnation is fact of the USA economic life. People just do not discuss it much anymore, but that's another strategic threat to neoliberalism and to the USA-centered neoliberal empire. Attempt to grab Venezuela resources is a demonstration that this treat is taken seriously.
As a side note, Neoliberalism as a social system, surprisingly managed to survive 2008 crisis largely intact converting itself into sudo-theocratic regime ( despite the fact that ideology was destroyed). It also successfully counterattacked in Argentina, Brazil, and France. Merkel, who is hard core neoliberal, managed to survive in Germany...
So it looks like it does have some staying power.
See "The Strange Non-Death of Neoliberalism" by Colin Crouch for an introduction to this strange phenomenon.
Still with the collapse of neoliberal ideology (essentially Trotskyism for the rich) the USA faces very uncertain future and supersized military expenses (essentially another form of looting of common people) does not changed the precarious situation the USA elite got the county. Neoliberal elite is not longer can rule as usual and the USA people want change. In other words we have what Marxists used to call a "revolutionary situation". It very much reminds me the USSR -- empire in 1970th with its stupid, degenerated and cannibalistic elite.We won the Cold War...
[ This assertion by DeLong, then leaves me wondering what winning the Cold War then or now would mean. We have, for instance, now arbitrarily set aside 2 Cold War nuclear arms treaties since 2001, and are building more nuclear capability when we have weaponry enough to decimate much of the earth, as does Russia.
Since Russia is now routinely considered a strategic adversary or threatening, we could not of course have won the Cold War. We routinely accuse supposed political opponents of being Russian sympathizers.
DeLong must be mistaken, unless there is a meaning of Cold War winning that is unclear to me. ]
Aug 05, 2019 | economistsview.typepad.com
EMichael , August 04, 2019 at 06:58 AMMore damage from the white working class, this time at the state level.Christopher H. said in reply to EMichael... , August 04, 2019 at 09:16 AM
"Meet The Right-Wing Consultant Who Goes From State To State Slashing Budgets
A few days after a powerful earthquake hit the state last November, Alaska Gov. Mike Dunleavy (R) issued an order increasing the power of the state's budget office, led by a woman who had lived in Alaska a mere two weeks at the time.
In her newly empowered role, Donna Arduin -- an infamous budget-slashing expert -- and Dunleavy went on cut to hundreds of millions from the state budget. They aim to trim even more in her second year in the remote state.
It's hardly Arduin's first rodeo. The budget consultant has served in several Republican-led governor's offices, slashing state expenses while cutting or resisting efforts to increase tax revenue.
She's also one of three leaders of the right-wing consulting firm Arduin Laffer & Moore Econometrics. Her partners are "Trumponomics" co-authors Arthur Laffer, the trickle-down economics evangelist, and Stephen Moore, who in May ruefully wished there was a "statute of limitations on saying stupid things" so he could've had a shot at joining the Federal Reserve Board.
Moore never made it to the Fed, but his and Laffer's histories as public figures offer some insight into Arduin's typically more behind-the-scenes roles.
Laffer made his name as the "father of supply-side economics" during the Reagan years and was just awarded a presidential medal of freedom. He was also one of the architects of former Kansas Gov. Sam Brownback's so-called "Kansas experiment," a massive tax cut effort passed by the state's Republican-dominated legislature in 2012. By 2017, the "experiment" had caused such devastation in the state that the GOP-led legislature voted to hike taxes back up and then overrode Brownback's veto. Moore also contributed to Brownback's failed plan.
A study from Laffer and Moore at the time lauding the potential effect of eliminating Oklahoma's income tax was found to have "fundamental flaws" in its math, three leading economists in the state found in separate papers. Each of the economists, the Oklahoma Policy Institute wrote, "cautions strongly against using it as the basis for public policy decisions."
And this is beyond sad.
"ince arriving in Alaska last year, Arduin has led the governor's attempt to cut a whopping $1.6 billion in spending from education, social services, the arts, and nearly every other corner of state government. Between legislative cuts and line-item vetoes, Dunleavy has so far cut "almost $700 million" from the budget in his first year, Arduin said in an interview earlier this month, despite a failed recent attempt by the legislature to override his vetoes.
"We're about halfway solved," she said. "We're going to be looking towards reducing the budget another $700 million next year."
The University of Alaska's Board of Regents, at a meeting in which they declared financial exigency last week, sounded less enthusiastic. The institution has been "crippled," its president said, by the governor cutting roughly 40% of the school's state funding -- over $130 million. Thousands of students across the state found their state-funded scholarships suddenly defunded with the school year looming. "We will not have a university after February if we don't make a move," one regent noted.
Another Alaskan who had scheduled a dentures appointment four weeks after having his teeth extracted was left with gums flapping in the wind, after the governor eliminated Medicaid dental coverage for adults. That saved the state $27 million.""More damage from the white working class, this time at the state level."Christopher H. said in reply to EMichael... , August 04, 2019 at 09:17 AM
If you don't have rising incomes and living standards, politics are going to turn toxic.
But we must never criticize the Dem leadership or their rich donors!
EMike is mad at the American voter. That's a convenient scapegoat for shtlibs like him.RC (Ron) Weakley said in reply to Christopher H.... , August 04, 2019 at 09:47 AMIf one is prohibited for religious reasons from blaming the Democratic Party then the only scapegoat left is the white working class voter. Racism is part and parcel to white working class anger, but it is not the whole enchilada by a long shot. Perhaps the romanticism surrounding "The Cause" and related notorious individuals such as formed the James Gang is inappropriate, but that romanticism owes more to Bacon's Rebellion and the Whiskey Rebellion than to the landing of the Isabella in Philadelphia in 1684. Not many of the Southern lads that fought in the Civil War were even able to afford to have slaves. Even more ironically many of those first slaves on the Isabella were bought by Quakers, later leading advocates of emancipation after machines had made slaves obsolete for their purposes.ken melvin -> RC (Ron) Weakley... , August 04, 2019 at 10:19 AM
Simple mindedness is almost always simply wrong.In the summer of 1970, Roger Ailes, then a consultant to then President Richard Nixon, in a memo entitled "A Plan for Putting the GOP on TV News," wrote, "Today television news is watched more often than people read newspapers, than people listen to the radio, than people read or gather any other form of communication. The reason: People are lazy. With television you just sit -- watch -- listen. The thinking is done for you." Ailes, as media consultant to Reagan and Bush I, was there for the most effective: 'Southern Strategy'; via a protege, 'Willie Horton' ad; character assassination of Michael Dukakis; Fox News, with Roger Ailes as CEO, was launched in 1996 by Rupert Murdoch to appeal to a conservative audience, and, to offset the liberal bias of the other outlets.RC (Ron) Weakley said in reply to ken melvin... , August 04, 2019 at 11:00 AMhttps://en.wikipedia.org/wiki/Southern_strategyRC (Ron) Weakley said in reply to RC (Ron) Weakley... , August 04, 2019 at 11:03 AM
American politics, the Southern strategy was a Republican Party electoral strategy to increase political support among white voters in the South by appealing to racism against African Americans. As the civil rights movement and dismantling of Jim Crow laws in the 1950s and 1960s visibly deepened existing racial tensions in much of the Southern United States, Republican politicians such as presidential candidate Richard Nixon and Senator Barry Goldwater developed strategies that successfully contributed to the political realignment of many white, conservative voters in the South who had traditionally supported the Democratic Party rather than the Republican Party. It also helped to push the Republican Party much more to the right.
The "Southern Strategy" refers primarily to "top down" narratives of the political realignment of the South which suggest that Republican leaders consciously appealed to many white Southerners' racial grievances in order to gain their support. This top-down narrative of the Southern Strategy is generally believed to be the primary force that transformed Southern politics following the civil rights era. This view has been questioned by historians such as Matthew Lassiter, Kevin M. Kruse and Joseph Crespino, who have presented an alternative, "bottom up" narrative, which Lassiter has called the "suburban strategy". This narrative recognizes the centrality of racial backlash to the political realignment of the South, but suggests that this backlash took the form of a defense of de facto segregation in the suburbs rather than overt resistance to racial integration and that the story of this backlash is a national rather than a strictly Southern one.
The perception that the Republican Party had served as the "vehicle of white supremacy in the South", particularly during the Goldwater campaign and the presidential elections of 1968 and 1972, made it difficult for the Republican Party to win back the support of black voters in the South in later years. In 2005, Republican National Committee chairman Ken Mehlman formally apologized to the National Association for the Advancement of Colored People (NAACP), a national civil rights organization, for exploiting racial polarization to win elections and ignoring the black vote.
Although the phrase "Southern Strategy" is often attributed to Nixon's political strategist Kevin Phillips, he did not originate it but popularized it. In an interview included in a 1970 New York Times article, Phillips stated his analysis based on studies of ethnic voting:
From now on, the Republicans are never going to get more than 10 to 20 percent of the Negro vote and they don't need any more than that... but Republicans would be shortsighted if they weakened enforcement of the Voting Rights Act. The more Negroes who register as Democrats in the South, the sooner the Negrophobe whites will quit the Democrats and become Republicans. That's where the votes are. Without that prodding from the blacks, the whites will backslide into their old comfortable arrangement with the local Democrats.
While Phillips sought to increase Republican power by polarizing ethnic voting in general, and not just to win the white South, the South was by far the biggest prize yielded by his approach. Its success began at the presidential level. Gradually, Southern voters began to elect Republicans to Congress and finally to statewide and local offices, particularly as some legacy segregationist Democrats retired or switched to the GOP.[who?] In addition, the Republican Party worked for years to develop grassroots political organizations across the South, supporting candidates for local school boards and city and county offices as examples, but following the Watergate scandal Southern voters came out in support for the "favorite son" candidate, Southern Democrat Jimmy Carter.
From 1948 to 1984, the Southern states, for decades a stronghold for the Democrats, became key swing states, providing the popular vote margins in the 1960, 1968 and 1976 elections. During this era, several Republican candidates expressed support for states' rights, a reversal of the position held by southern states prior to the Civil War. Some political analysts said this term was used in the 20th century as a "code word" to represent opposition to federal enforcement of civil rights for blacks and to federal intervention on their behalf; many individual southerners had opposed passage of the Voting Rights Act.
[I love being schooled on this stuff as if I had not been there politically active supporting MLK and SCLC at the time. I had never even heard of Roger Ailes until his association with Rupert Murdoch. Of course that was because what mattered back then was happening on the ground. There was no Internet whipping people up into a frenzied stupor, a psychological condition of metaphorically being all dressed up with no where to go.
BTW, both narratives, i.e. top down and bottom up, were simultaneously correct and true. It is simple minded to think in only one way and one dimension of thought at a time. Forces aggregate and enough smaller vectors pushing in roughly the same direction will collectively overcome a more powerful opposition that has ignored the coming forces.]"...enough smaller vectors pushing in roughly the same direction will collectively overcome a more powerful opposition that has ignored the coming forces.]"
[The story of the Democratic Party ever since Thomas Jefferson. Apparently the Democratic Party invented naïve arrogance or at least patented it.]
Aug 04, 2019 | jessescrossroadscafe.blogspot.com
"Thus we see how the neoliberal utopia tends to embody itself in the reality of a kind of infernal machine, whose necessity imposes itself even upon the rulers. Like the Marxism of an earlier time, with which, in this regard, it has much in common, this utopia evokes powerful belief - the free trade faith - not only among those who live off it, such as financiers, the owners and managers of large corporations, etc., but also among those, such as high-level government officials and politicians, who derive their justification for existing from it.
For they sanctify the power of markets in the name of economic efficiency, which requires the elimination of administrative or political barriers capable of inconveniencing the owners of capital in their individual quest for the maximisation of individual profit, which has been turned into a model of rationality. They want independent central banks.
And they preach the subordination of nation-states to the requirements of economic freedom for the masters of the economy, with the suppression of any regulation of any market, beginning with the labour market, the prohibition of deficits and inflation, the general privatisation of public services, and the reduction of public and social expenses."
Pierre Bourdieu, L'essence du néolibéralisme
Aug 04, 2019 | www.nakedcapitalism.com
Ian Perkins , August 4, 2019 at 10:16 am
Excellent article, I agree.
As regards clear language and definitions, I much prefer Michael Hudson's insistence that, to the liberal economists, free markets were markets free from rent seeking, while to the neoliberals free markets are free from government regulation.
"As governments were democratized, especially in the United States, liberals came to endorse a policy of active public welfare spending and hence government intervention, especially on behalf of the poor and disadvantaged. neoliberalism sought to restore the centralized aristocratic and oligarchic rentier control of domestic politics."
http://michael-hudson.com/2014/01/l-is-for-land/ – "Liberal"
Aug 04, 2019 | www.nakedcapitalism.com
By Robert Kuttner, The American Prospect. Reposted from Alternet .
Since the late 1970s, we've had a grand experiment to test the claim that free markets really do work best. This resurrection occurred despite the practical failure of laissez-faire in the 1930s, the resulting humiliation of free-market theory, and the contrasting success of managed capitalism during the three-decade postwar boom.
Yet when growth faltered in the 1970s, libertarian economic theory got another turn at bat. This revival proved extremely convenient for the conservatives who came to power in the 1980s. The neoliberal counterrevolution, in theory and policy, has reversed or undermined nearly every aspect of managed capitalism -- from progressive taxation, welfare transfers, and antitrust, to the empowerment of workers and the regulation of banks and other major industries.
Neoliberalism's premise is that free markets can regulate themselves; that government is inherently incompetent, captive to special interests, and an intrusion on the efficiency of the market; that in distributive terms, market outcomes are basically deserved; and that redistribution creates perverse incentives by punishing the economy's winners and rewarding its losers. So government should get out of the market's way.
By the 1990s, even moderate liberals had been converted to the belief that social objectives can be achieved by harnessing the power of markets. Intermittent periods of governance by Democratic presidents slowed but did not reverse the slide to neoliberal policy and doctrine. The corporate wing of the Democratic Party approved.
Now, after nearly half a century, the verdict is in. Virtually every one of these policies has failed, even on their own terms. Enterprise has been richly rewarded, taxes have been cut, and regulation reduced or privatized. The economy is vastly more unequal, yet economic growth is slower and more chaotic than during the era of managed capitalism. Deregulation has produced not salutary competition, but market concentration. Economic power has resulted in feedback loops of political power, in which elites make rules that bolster further concentration.
The culprit isn't just "markets" -- some impersonal force that somehow got loose again. This is a story of power using theory. The mixed economy was undone by economic elites, who revised rules for their own benefit. They invested heavily in friendly theorists to bless this shift as sound and necessary economics, and friendly politicians to put those theories into practice.
Recent years have seen two spectacular cases of market mispricing with devastating consequences: the near-depression of 2008 and irreversible climate change. The economic collapse of 2008 was the result of the deregulation of finance. It cost the real U.S. economy upwards of $15 trillion (and vastly more globally), depending on how you count, far more than any conceivable efficiency gain that might be credited to financial innovation. Free-market theory presumes that innovation is necessarily benign. But much of the financial engineering of the deregulatory era was self-serving, opaque, and corrupt -- the opposite of an efficient and transparent market.
The existential threat of global climate change reflects the incompetence of markets to accurately price carbon and the escalating costs of pollution. The British economist Nicholas Stern has aptly termed the worsening climate catastrophe history's greatest case of market failure. Here again, this is not just the result of failed theory. The entrenched political power of extractive industries and their political allies influences the rules and the market price of carbon. This is less an invisible hand than a thumb on the scale. The premise of efficient markets provides useful cover.
The grand neoliberal experiment of the past 40 years has demonstrated that markets in fact do not regulate themselves. Managed markets turn out to be more equitable and more efficient. Yet the theory and practical influence of neoliberalism marches splendidly on, because it is so useful to society's most powerful people -- as a scholarly veneer to what would otherwise be a raw power grab. The British political economist Colin Crouch captured this anomaly in a book nicely titled The Strange Non-Death of Neoliberalism . Why did neoliberalism not die? As Crouch observed, neoliberalism failed both as theory and as policy, but succeeded superbly as power politics for economic elites.
The neoliberal ascendance has had another calamitous cost -- to democratic legitimacy. As government ceased to buffer market forces, daily life has become more of a struggle for ordinary people. The elements of a decent middle-class life are elusive -- reliable jobs and careers, adequate pensions, secure medical care, affordable housing, and college that doesn't require a lifetime of debt. Meanwhile, life has become ever sweeter for economic elites, whose income and wealth have pulled away and whose loyalty to place, neighbor, and nation has become more contingent and less reliable.
Large numbers of people, in turn, have given up on the promise of affirmative government, and on democracy itself. After the Berlin Wall came down in 1989, ours was widely billed as an era when triumphant liberal capitalism would march hand in hand with liberal democracy. But in a few brief decades, the ostensibly secure regime of liberal democracy has collapsed in nation after nation, with echoes of the 1930s.
As the great political historian Karl Polanyi warned, when markets overwhelm society, ordinary people often turn to tyrants. In regimes that border on neofascist, klepto-capitalists get along just fine with dictators, undermining the neoliberal premise of capitalism and democracy as complements. Several authoritarian thugs, playing on tribal nationalism as the antidote to capitalist cosmopolitanism, are surprisingly popular.
It's also important to appreciate that neoliberalism is not laissez-faire. Classically, the premise of a "free market" is that government simply gets out of the way. This is nonsensical, since all markets are creatures of rules, most fundamentally rules defining property, but also rules defining credit, debt, and bankruptcy; rules defining patents, trademarks, and copyrights; rules defining terms of labor; and so on. Even deregulation requires rules. In Polanyi's words, "laissez-faire was planned."
The political question is who gets to make the rules, and for whose benefit. The neoliberalism of Friedrich Hayek and Milton Friedman invoked free markets, but in practice the neoliberal regime has promoted rules created by and for private owners of capital, to keep democratic government from asserting rules of fair competition or countervailing social interests. The regime has rules protecting pharmaceutical giants from the right of consumers to import prescription drugs or to benefit from generics. The rules of competition and intellectual property generally have been tilted to protect incumbents. Rules of bankruptcy have been tilted in favor of creditors. Deceptive mortgages require elaborate rules, written by the financial sector and then enforced by government. Patent rules have allowed agribusiness and giant chemical companies like Monsanto to take over much of agriculture -- the opposite of open markets. Industry has invented rules requiring employees and consumers to submit to binding arbitration and to relinquish a range of statutory and common-law rights.
Neoliberalism as Theory, Policy, and Power
It's worth taking a moment to unpack the term "neoliberalism." The coinage can be confusing to American ears because the "liberal" part refers not to the word's ordinary American usage, meaning moderately left-of-center, but to classical economic liberalism otherwise known as free-market economics. The "neo" part refers to the reassertion of the claim that the laissez-faire model of the economy was basically correct after all.
Few proponents of these views embraced the term neoliberal . Mostly, they called themselves free-market conservatives. "Neoliberal" was a coinage used mainly by their critics, sometimes as a neutral descriptive term, sometimes as an epithet. The use became widespread in the era of Margaret Thatcher and Ronald Reagan.
To add to the confusion, a different and partly overlapping usage was advanced in the 1970s by the group around the Washington Monthly magazine. They used "neoliberal" to mean a new, less statist form of American liberalism. Around the same time, the term neoconservative was used as a self-description by former liberals who embraced conservatism, on cultural, racial, economic, and foreign-policy grounds. Neoconservatives were neoliberals in economics.
Beginning in the 1970s, resurrected free-market theory was interwoven with both conservative politics and significant investments in the production of theorists and policy intellectuals. This occurred not just in well-known conservative think tanks such as the American Enterprise Institute, Heritage, Cato, and the Manhattan Institute, but through more insidious investments in academia. Lavishly funded centers and tenured chairs were underwritten by the Olin, Scaife, Bradley, and other far-right foundations to promote such variants of free-market theory as law and economics, public choice, rational choice, cost-benefit analysis, maximize-shareholder-value, and kindred schools of thought. These theories colonized several academic disciplines. All were variations on the claim that markets worked and that government should get out of the way.
Each of these bodies of sub-theory relied upon its own variant of neoliberal ideology. An intensified version of the theory of comparative advantage was used not just to cut tariffs but to use globalization as all-purpose deregulation. The theory of maximizing shareholder value was deployed to undermine the entire range of financial regulation and workers' rights. Cost-benefit analysis, emphasizing costs and discounting benefits, was used to discredit a good deal of health, safety, and environmental regulation. Public choice theory, associated with the economist James Buchanan and an entire ensuing school of economics and political science, was used to impeach democracy itself, on the premise that policies were hopelessly afflicted by "rent-seekers" and "free-riders."
Click here to read how Robert Kuttner has been unmasking the fallacies of neoliberalism for decades
Market failure was dismissed as a rare special case; government failure was said to be ubiquitous. Theorists worked hand in glove with lobbyists and with public officials. But in every major case where neoliberal theory generated policy, the result was political success and economic failure.
For example, supply-side economics became the justification for tax cuts, on the premise that taxes punished enterprise. Supposedly, if taxes were cut, especially taxes on capital and on income from capital, the resulting spur to economic activity would be so potent that deficits would be far less than predicted by "static" economic projections, and perhaps even pay for themselves. There have been six rounds of this experiment, from the tax cuts sponsored by Jimmy Carter in 1978 to the immense 2017 Tax Cuts and Jobs Act signed by Donald Trump. In every case some economic stimulus did result, mainly from the Keynesian jolt to demand, but in every case deficits increased significantly. Conservatives simply stopped caring about deficits. The tax cuts were often inefficient as well as inequitable, since the loopholes steered investment to tax-favored uses rather than the most economically logical ones. Dozens of America's most profitable corporations paid no taxes.
Robert Bork's "antitrust paradox," holding that antitrust enforcement actually weakened competition, was used as the doctrine to sideline the Sherman and Clayton Acts. Supposedly, if government just got out of the way, market forces would remain more competitive because monopoly pricing would invite innovation and new entrants to the market. In practice, industry after industry became more heavily concentrated. Incumbents got in the habit of buying out innovators or using their market power to crush them. This pattern is especially insidious in the tech economy of platform monopolies, where giants that provide platforms, such as Google and Amazon, use their market power and superior access to customer data to out-compete rivals who use their platforms. Markets, once again, require rules beyond the benign competence of the market actors themselves. Only democratic government can set equitable rules. And when democracy falters, undemocratic governments in cahoots with corrupt private plutocrats will make the rules.
Human capital theory, another variant of neoliberal application of markets to partly social questions, justified deregulating labor markets and crushing labor unions. Unions supposedly used their power to get workers paid more than their market worth. Likewise minimum wage laws. But the era of depressed wages has actually seen a decline in rates of productivity growth. Conversely, does any serious person think that the inflated pay of the financial moguls who crashed the economy accurately reflects their contribution to economic activity? In the case of hedge funds and private equity, the high incomes of fund sponsors are the result of transfers of wealth and income from employees, other stakeholders, and operating companies to the fund managers, not the fruits of more efficient management.
There is a broad literature discrediting this body of pseudo-scholarly work in great detail. Much of neoliberalism represents the ever-reliable victory of assumption over evidence. Yet neoliberal theory lived on because it was so convenient for elites, and because of the inertial power of the intellectual capital that had been created. The well-funded neoliberal habitat has provided comfortable careers for two generations of scholars and pseudo-scholars who migrate between academia, think tanks, K Street, op-ed pages, government, Wall Street, and back again. So even if the theory has been demolished both by scholarly rebuttal and by events, it thrives in powerful institutions and among their political allies.
The Practical Failure of Neoliberal Policies
Financial deregulation is neoliberalism's most palpable deregulatory failure, but far from the only one. Electricity deregulation on balance has increased monopoly power and raised costs to consumers, but has failed to offer meaningful "shopping around" opportunities to bring down prices. We have gone from regulated monopolies with predictable earnings, costs, wages, and consumer protections to deregulated monopolies or oligopolies with substantial pricing power. Since the Bell breakup, the telephone system tells a similar story of re-concentration, dwindling competition, price-gouging, and union-bashing.
Air travel has been a poster child for advocates of deregulation, but the actual record is mixed at best. Airline deregulation produced serial bankruptcies of every major U.S. airline, often at the cost of worker pay and pension funds. Ticket prices have declined on average over the past two decades, but the traveling public suffers from a crazy quilt of fares, declining service, shrinking seats and legroom, and exorbitant penalties for the perfectly normal sin of having to change plans. Studies have shown that fares actually declined at a faster rate in the 20 years before deregulation in 1978 than in the 20 years afterward, because the prime source of greater efficiency in airline travel is the introduction of more fuel-efficient planes. The roller-coaster experience of airline profits and losses has reduced the capacity of airlines to purchase more fuel-efficient aircraft, and the average age of the fleet keeps increasing. The use of "fortress hubs" to defend market pricing power has reduced the percentage of nonstop flights, the most efficient way to fly from one point to another.
In addition to deregulation, three prime areas of practical neoliberal policies are the use of vouchers as "market-like" means to social goals, the privatization of public services, and the use of tax subsides rather than direct outlays. In every case, government revenues are involved, so this is far from a free market to begin with. But the premise is that market disciplines can achieve public purposes more efficiently than direct public provision.
The evidence provides small comfort for these claims. One core problem is that the programs invariably give too much to the for-profit middlemen at the expense of the intended beneficiaries. A related problem is that the process of using vouchers and contracts invites corruption. It is a different form of "rent-seeking" -- pursuit of monopoly profits -- than that attributed to government by public choice theorists, but corruption nonetheless. Often, direct public provision is far more transparent and accountable than a web of contractors.
A further problem is that in practice there is often far less competition than imagined, because of oligopoly power, vendor lock-in, and vendor political influence. These experiments in marketization to serve social goals do not operate in some Platonic policy laboratory, where the only objective is true market efficiency yoked to the public good. They operate in the grubby world of practical politics, where the vendors are closely allied with conservative politicians whose purposes may be to discredit social transfers entirely, or to reward corporate allies, or to benefit from kickbacks either directly or as campaign contributions.
Privatized prisons are a case in point. A few large, scandal-ridden companies have gotten most of the contracts, often through political influence. Far from bringing better quality and management efficiency, they have profited by diverting operating funds and worsening conditions that were already deplorable, and finding new ways to charge inmates higher fees for necessary services such as phone calls. To the extent that money was actually saved, most of the savings came from reducing the pay and professionalism of guards, increasing overcrowding, and decreasing already inadequate budgets for food and medical care.
A similar example is the privatization of transportation services such as highways and even parking meters. In several Midwestern states, toll roads have been sold to private vendors. The governor who makes the deal gains a temporary fiscal windfall, while drivers end up paying higher tolls often for decades. Investment bankers who broker the deal also take their cut. Some of the money does go into highway improvements, but that could have been done more efficiently in the traditional way via direct public ownership and competitive bidding.
Housing vouchers substantially reward landlords who use the vouchers to fill empty houses with poor people until the neighborhood gentrifies, at which point the owner is free to quit the program and charge market rentals. Thus public funds are used to underwrite a privately owned, quasi-social housing sector -- whose social character is only temporary. No permanent social housing is produced despite the extensive public outlay. The companion use of tax incentives to attract passive investment in affordable housing promotes economically inefficient tax shelters, and shunts public funds into the pockets of the investors -- money that might otherwise have gone directly to the housing.
The Affordable Care Act is a form of voucher. But the regulated private insurance markets in the ACA have not fully lived up to their promise, in part because of the extensive market power retained by private insurers and in part because the right has relentlessly sought to sabotage the program -- another political feedback loop. The sponsors assumed that competition would lower costs and increase consumer choice. But in too many counties, there are three or fewer competing plans, and in some cases just one.
As more insurance plans and hospital systems become for-profit, massive investment goes into such wasteful activities as manipulation of billing, "risk selection," and other gaming of the rules. Our mixed-market system of health care requires massive regulation to work with tolerable efficiency. In practice, this degenerates into an infinite regress of regulator versus commercial profit-maximizer, reminiscent of Mad magazine's "Spy versus Spy," with the industry doing end runs to Congress to further rig the rules. Straight-ahead public insurance such as Medicare is generally far more efficient.
An extensive literature has demonstrated that for-profit voucher schools do no better and often do worse than comparable public schools, and are vulnerable to multiple forms of gaming and corruption. Proprietors of voucher schools are superb at finding ways of excluding costly special-needs students, so that those costs are imposed on what remains of public schools; they excel at gaming test results. While some voucher and charter schools, especially nonprofit ones, sometimes improve on average school performance, so do many public schools. The record is also muddied by the fact that many ostensibly nonprofit schools contract out management to for-profit companies.
Tax preferences have long been used ostensibly to serve social goals. The Earned Income Tax Credit is considered one of the more successful cases of using market-like measures -- in this case a refundable tax credit -- to achieve the social goal of increasing worker take-home pay. It has also been touted as the rare case of bipartisan collaboration. Liberals get more money for workers. Conservatives get to reward the deserving poor, since the EITC is conditioned on employment. Conservatives get a further ideological win, since the EITC is effectively a wage subsidy from the government, but is experienced as a tax refund rather than a benefit of government.
Recent research, however, shows that the EITC is primarily a subsidy of low-wage employers, who are able to pay their workers a lot less than a market-clearing wage. In industries such as nursing homes or warehouses, where many workers qualified for the EITC work side by side with ones not eligible, the non-EITC workers get substandard wages. The existence of the EITC depresses the level of the wages that have to come out of the employer's pocket.
Neoliberalism's Influence on Liberals
As free-market theory resurged, many moderate liberals embraced these policies. In the inflationary 1970s, regulation became a scapegoat that supposedly deterred salutary price competition. Some, such as economist Alfred Kahn, President Carter's adviser on deregulation, supported deregulation on what he saw as the merits. Other moderates supported neoliberal policies opportunistically, to curry favor with powerful industries and donors. Market-like policies were also embraced by liberals as a tactical way to find common ground with conservatives.
Several forms of deregulation -- of airlines, trucking, and electric power -- began not under Reagan but under Carter. Financial deregulation took off under Bill Clinton. Democratic presidents, as much as Republicans, promoted trade deals that undermined social standards. Cost-benefit analysis by the Office of Information and Regulatory Affairs (OIRA) was more of a choke point under Barack Obama than under George W. Bush.
"Command and control" became an all-purpose pejorative for disparaging perfectly sensible and efficient regulation. "Market-like" became a fashionable concept, not just on the free-market right but on the moderate left. Cass Sunstein, who served as Obama's anti-regulation czar,uses the example of "nudges" as a more market-like and hence superior alternative to direct regulation, though with rare exceptions their impact is trivial. Moreover, nudges only work in tandem with regulation.
There are indeed some interventionist policies that use market incentives to serve social goals. But contrary to free-market theory, the market-like incentives first require substantial regulation and are not a substitute for it. A good example is the Clean Air Act Amendments of 1990, which used tradable emission rights to cut the output of sulfur dioxide, the cause of acid rain. This was supported by both the George H.W. Bush administration and by leading Democrats. But before the trading regime could work, Congress first had to establish permissible ceilings on sulfur dioxide output -- pure command and control.
There are many other instances, such as nutrition labeling, truth-in-lending, and disclosure of EPA gas mileage results, where the market-like premise of a better-informed consumer complements command regulation but is no substitute for it. Nearly all of the increase in fuel efficiency, for example, is the result of command regulations that require auto fleets to hit a gas mileage target. The fact that EPA gas mileage figures are prominently disclosed on new car stickers may have modest influence, but motor fuels are so underpriced that car companies have success selling gas-guzzlers despite the consumer labeling.
Politically, whatever rationale there was for liberals to make common ground with libertarians is now largely gone. The authors of the 2017 Tax Cuts and Jobs Act made no attempt to meet Democrats partway; they excluded the opposition from the legislative process entirely. This was opportunistic tax cutting for elites, pure and simple. The right today also abandoned the quest for a middle ground on environmental policy, on anti-poverty policy, on health policy -- on virtually everything. Neoliberal ideology did its historic job of weakening intellectual and popular support for the proposition that affirmative government can better the lives of citizens and that the Democratic Party is a reliable steward of that social compact. Since Reagan, the right's embrace of the free market has evolved from partly principled idealism into pure opportunism and obstruction.
Neoliberalism and Hyper-Globalism
The post-1990 rules of globalization, supported by conservatives and moderate liberals alike, are the quintessence of neoliberalism. At Bretton Woods in 1944, the use of fixed exchange rates and controls on speculative private capital, plus the creation of the IMFand World Bank, were intended to allow member countries to practice national forms of managed capitalism, insulated from the destructive and deflationary influences of short-term speculative private capital flows. As doctrine and power shifted in the 1970s, the IMF, the World Bank, and later the WTO, which replaced the old GATT, mutated into their ideological opposite. Rather than instruments of support for mixed national economies, they became enforcers of neoliberal policies.
The standard package of the "Washington Consensus" of approved policies for developing nations included demands that they open their capital markets to speculative private finance, as well as cutting taxes on capital, weakening social transfers, and gutting labor regulation and public ownership. But private capital investment in poor countries proved to be fickle. The result was often excessive inflows during the boom part of the cycle and punitive withdrawals during the bust -- the opposite of the patient, long-term development capital that these countries needed and that was provided by the World Bank of an earlier era. During the bust phase, the IMFtypically imposes even more stringent neoliberal demands as the price of financial bailouts, including perverse budgetary austerity, supposedly to restore the confidence of the very speculative capital markets responsible for the boom-bust cycle.
Dozens of nations, from Latin America to East Asia, went through this cycle of boom, bust, and then IMF pile-on. Greece is still suffering the impact. After 1990, hyper-globalism also included trade treaties whose terms favored multinational corporations. Traditionally, trade agreements had been mainly about reciprocal reductions of tariffs. Nations were free to have whatever brand of regulation, public investment, or social policies they chose. With the advent of the WTO, many policies other than tariffs were branded as trade distorting, even as takings without compensation. Trade deals were used to give foreign capital free access and to dismantle national regulation and public ownership. Special courts were created in which foreign corporations and investors could do end runs around national authorities to challenge regulation for impeding commerce.
At first, the sponsors of the new trade regime tried to claim the successful economies of East Asia as evidence of the success of the neoliberal recipe. Supposedly, these nations had succeeded by pursuing "export-led growth," exposing their domestic economies to salutary competition. But these claims were soon exposed as the opposite of what had actually occurred. In fact, Japan, South Korea, smaller Asian nations, and above all China had thrived by rejecting every major tenet of neoliberalism. Their capital markets were tightly regulated and insulated from foreign speculative capital. They developed world-class industries as state-led cartels that favored domestic production and supply. East Asia got into trouble only when it followed IMFdictates to throw open capital markets, and in the aftermath they recovered by closing those markets and assembling war chests of hard currency so that they'd never again have to go begging to the IMF. Enthusiasts of hyper-globalization also claimed that it benefited poor countries by increasing export opportunities, but as the success of East Asia shows, there is more than one way to boost exports -- and many poorer countries suffered under the terms of the global neoliberal regime.
Nor was the damage confined to the developing world. As the work of Harvard economist Dani Rodrik has demonstrated, democracy requires a polity. For better or for worse, the polity and democratic citizenship are national. By enhancing the global market at the expense of the democratic state, the current brand of hyper-globalization deliberately weakens the capacity of states to regulate markets, and weakens democracy itself.
When Do Markets Work?
The failure of neoliberalism as economic and social policy does not mean that markets never work. A command economy is even more utopian and perverse than a neoliberal one. The practical quest is for an efficient and equitable middle ground.
The neoliberal story of how the economy operates assumes a largely frictionless marketplace, where prices are set by supply and demand, and the price mechanism allocates resources to their optimal use in the economy as a whole. For this discipline to work as advertised, however, there can be no market power, competition must be plentiful, sellers and buyers must have roughly equal information, and there can be no significant externalities. Much of the 20th century was practical proof that these conditions did not describe a good part of the actual economy. And if markets priced things wrong, the market system did not aggregate to an efficient equilibrium, and depressions could become self-deepening. As Keynes demonstrated, only a massive jolt of government spending could restart the engines, even if market pricing was partly violated in the process.
Nonetheless, in many sectors of the economy, the process of buying and selling is close enough to the textbook conditions of perfect competition that the price system works tolerably well. Supermarkets, for instance, deliver roughly accurate prices because of the consumer's freedom and knowledge to shop around. Likewise much of retailing. However, when we get into major realms of the economy with positive or negative externalities, such as education and health, markets are not sufficient. And in other major realms, such as pharmaceuticals, where corporations use their political power to rig the terms of patents, the market doesn't produce a cure.
The basic argument of neoliberalism can fit on a bumper sticker. Markets work; governments don't . If you want to embellish that story, there are two corollaries: Markets embody human freedom. And with markets, people basically get what they deserve; to alter market outcomes is to spoil the poor and punish the productive. That conclusion logically flows from the premise that markets are efficient. Milton Friedman became rich, famous, and influential by teasing out the several implications of these simple premises.
It is much harder to articulate the case for a mixed economy than the case for free markets, precisely because the mixed economy is mixed. The rebuttal takes several paragraphs. The more complex story holds that markets are substantially efficient in some realms but far from efficient in others, because of positive and negative externalities, the tendency of financial markets to create cycles of boom and bust, the intersection of self-interest and corruption, the asymmetry of information between company and consumer, the asymmetry of power between corporation and employee, the power of the powerful to rig the rules, and the fact that there are realms of human life (the right to vote, human liberty, security of one's person) that should not be marketized.
And if markets are not perfectly efficient, then distributive questions are partly political choices. Some societies pay pre-K teachers the minimum wage as glorified babysitters. Others educate and compensate them as professionals. There is no "correct" market-derived wage, because pre-kindergarten is a social good and the issue of how to train and compensate teachers is a social choice, not a market choice. The same is true of the other human services, including medicine. Nor is there a theoretically correct set of rules for patents, trademarks, and copyrights. These are politically derived, either balancing the interests of innovation with those of diffusion -- or being politically captured by incumbent industries.
Governments can in principle improve on market outcomes via regulation, but that fact is complicated by the risk of regulatory capture. So another issue that arises is market failure versus polity failure, which brings us back to the urgency of strong democracy and effective government.
The political reversal of neoliberalism can only come through practical politics and policies that demonstrate how government often can serve citizens more equitably and efficiently than markets. Revision of theory will take care of itself. There is no shortage of dissenting theorists and empirical policy researchers whose scholarly work has been vindicated by events. What they need is not more theory but more influence, both in the academy and in the corridors of power. They are available to advise a new progressive administration, if that administration can get elected and if it refrains from hiring neoliberal advisers.
There are also some relatively new areas that invite policy innovation. These include regulation of privacy rights versus entrepreneurial liberties in the digital realm; how to think of the internet as a common carrier; how to update competition and antitrust policy as platform monopolies exert new forms of market power; how to modernize labor-market policy in the era of the gig economy; and the role of deeper income supplements as machines replace human workers.
The failed neoliberal experiment also makes the case not just for better-regulated capitalism but for direct public alternatives as well. Banking, done properly, especially the provision of mortgage finance, is close to a public utility. Much of it could be public. A great deal of research is done more honestly and more cost-effectively in public, peer-reviewed institutions such as the NIHthan by a substantially corrupt private pharmaceutical industry. Social housing often is more cost-effective than so-called public-private partnerships. Public power is more efficient to generate, less prone to monopolistic price-gouging, and friendlier to the needed green transition than private power. The public option in health care is far more efficient than the current crazy quilt in which each layer of complexity adds opacity and cost. Public provision does require public oversight, but that is more straightforward and transparent than the byzantine dance of regulation and counter-regulation.
The two other benefits of direct public provision are that the public gets direct evidence of government delivering something of value, and that the countervailing power of democracy to harness markets is enhanced. A mixed economy depends above all on a strong democracy -- one even stronger than the democracy that succumbed to the corrupting influence of economic elites and their neoliberal intellectual allies beginning half a century ago. The antidote to the resurrected neoliberal fable is the resurrection of democracy -- strong enough to tame the market in a way that tames it for keeps.
Arthur Littwin , August 4, 2019 at 7:36 am
Excellent article and very much appreciated so I can share with confused Liberal friends (mostly older) who think that they are now, somehow, Neoliberal. As far as market failure is concerned: I think Boeing is an incredible case in point. When one of the nation's flagship enterprises captures regulatory processes so completely that it produces a product that cannot accomplish its one aim: to fly. Btw: I am seeing a lot of use of the "populist" to describe what might be more correctly described as nativist, xenophobic, anti-democratic, authoritarian, or even outright fascist leaders. Keep the language clear and insist on precise definitions.
Ian Perkins , August 4, 2019 at 10:16 am
Excellent article, I agree. As regards clear language and definitions, I much prefer Michael Hudson's insistence that, to the liberal economists, free markets were markets free from rent seeking, while to the neoliberals free markets are free from government regulation.
"As governments were democratized, especially in the United States, liberals came to endorse a policy of active public welfare spending and hence government intervention, especially on behalf of the poor and disadvantaged. neoliberalism sought to restore the centralized aristocratic and oligarchic rentier control of domestic politics."
http://michael-hudson.com/2014/01/l-is-for-land/ – "Liberal"
bwilli123 , August 4, 2019 at 7:44 am
"The economic collapse of 2008 was the result of the deregulation of finance. It cost the real U.S. economy upwards of $15 trillion (and vastly more globally), depending on how you count, far more than any conceivable efficiency gain that might be credited to financial innovation ."
That High Priest of neo-Liberalism Alan Greenspan once said, "The only thing useful banks have invented in 20 years is the ATM "
vern lyon , August 4, 2019 at 8:33 am
Sorry, the ATM quote was Paul Volker not Greenspan.
paul , August 4, 2019 at 8:23 am
In my worthless opinion: The private sector is great for what you do not need
The public sector(direction not implementation) is the only way to provide what we all need. 2.5 up maslow's pyramid would suit many.
If you are short of links tomorrow: Craig Murray would be worth a look
Divadab , August 4, 2019 at 8:23 am
Hard to see how the federal government can be gotten back from the cartels at this point- the whole thing is so corrupt. And the "socialism is bad" mantra has captured a lot of easily led brains.
In a political system where the reputedly "labor" party would rather lose with their bribe-taking warmongering Goldwater girl than win with a people's advocate, Houston we have a problem.
As with anthropogenic climate change, the cause is systemic- the political system is based on money control and the economic system is based on unsustainable energy use. Absent a crash, crisis, systematic chaos and destruction I don't see much changing other than at the margins- the corruption is too entrenched.
Watt4Bob , August 4, 2019 at 9:28 am
We were warned about the situation you describe.
The following is a portion of an op-ed piece that appeared in the New York Times On April 4, 1944 . It was written by Henry Wallace, FDR's vice president;
If we define an American fascist as one who in case of conflict puts money and power ahead of human beings, then there are undoubtedly several million fascists in the United States. There are probably several hundred thousand if we narrow the definition to include only those who in their search for money and power are ruthless and deceitful. Most American fascists are enthusiastically supporting the war effort. They are doing this even in those cases where they hope to have profitable connections with German chemical firms after the war ends. They are patriotic in time of war because it is to their interest to be so, but in time of peace they follow power and the dollar wherever they may lead.
American fascism will not be really dangerous until there is a purposeful coalition among the cartelists, the deliberate poisoners of public information, and those who stand for the K.K.K. type of demagoguery.
The European brand of fascism will probably present its most serious postwar threat to us via Latin America. The effect of the war has been to raise the cost of living in most Latin American countries much faster than the wages of labor. The fascists in most Latin American countries tell the people that the reason their wages will not buy as much in the way of goods is because of Yankee imperialism. The fascists in Latin America learn to speak and act like natives. Our chemical and other manufacturing concerns are all too often ready to let the Germans have Latin American markets, provided the American companies can work out an arrangement which will enable them to charge high prices to the consumer inside the United States. Following this war, technology will have reached such a point that it will be possible for Germans, using South America as a base, to cause us much more difficulty in World War III than they did in World War II. The military and landowning cliques in many South American countries will find it attractive financially to work with German fascist concerns as well as expedient from the standpoint of temporary power politics.
Fascism is a worldwide disease. Its greatest threat to the United States will come after the war, either via Latin America or within the United States itself.
The full text is quite useful in understanding that there is no question as to how and why we find ourselves in the present predicament, it is the logical outcome of a process that was well understood during FDR's tenure.
That understanding has since been deliberately eradicated by the powerful interests that control our media.
John Zelnicker , August 4, 2019 at 12:04 pm
August 4, 2019 at 9:28 am
-- -- -
Thank you for posting this excerpt.
There was a lot of wisdom put forth during and shortly after WWII in both politics (see above) and economics.
For example, there was a Treasury official, whose name I can't remember right now, who understood that the Federal government has no real need to collect taxes. And, Keynesianism prevailed until Milton Friedman and the Chicago School came along and turned everything upside down with Monetarism.
mle in detroit , August 4, 2019 at 12:54 pm
Wow, does Wallace's second paragraph describe today or what?
Ian Perkins , August 4, 2019 at 2:52 pm
My thoughts exactly.
Amfortas the hippie , August 4, 2019 at 10:00 am
"absent a crash " I reckon "unsustainable" is an important word to remember. None of it is sustainable all those spinning plates and balls in the air .and the grasshopper god demands that they keep adding more and more plates and balls.
All based on a bunch of purposefully unexamined assumptions.
... ... ...
Ian Perkins , August 4, 2019 at 10:34 am
Or Edward Abbey: "Growth for the sake of growth is the ideology of the cancer cell."
I did an A-level (UK exam for 18 year olds) in economics years ago, and despite passing with an A, I not only couldn't understand this underlying assumption of continued exponential growth forever, I also couldn't understand why anyone couldn't understand its obvious absurdity.
Sustainability was a bit of a new word in those days, but when I discovered it, it summed up my problems with (over-) developed economies.
Carolinian , August 4, 2019 at 9:32 am
To add to the confusion, a different and partly overlapping usage was advanced in the 1970s by the group around the Washington Monthly magazine. They used "neoliberal" to mean a new, less statist form of American liberalism. Around the same time, the term neoconservative was used as a self-description by former liberals who embraced conservatism, on cultural, racial, economic, and foreign-policy grounds. Neoconservatives were neoliberals in economics.
This commenter has been scolded in the past for invoking Charlie Peters and the Washington Monthly rather than Friedman, Hayek etc. But what Peters' highly influential magazine (and the transformed New Republic that followed) did was to bring the Democrats into the neoliberal fold and that may be the real reason it's a beast that can't be killed.
Neoliberalism gave liberals an excuse to sell out in the name of "fresh thinking." Meanwhile the vast working class had become discredited Archie Bunkers in the eyes of the intellectuals after Vietnam and the Civil Rights struggles.
It's possible that what really changed the country was the rise of that middle class that Kuttner now mourns. Suggesting that it was all the result of a rightwing plan is too easy although that was certainly part of it.
David , August 4, 2019 at 10:06 am
I'd add two other consequences of neoliberalism. One is the increasing alienation of citizens from the mechanism for provision of the basic necessities of life. Before the 1980s, for example, water, gas, electricity etc. were provided by publicly-owned utilities with local offices, recognisable local and national structures, and responsible to an elected Minister.
If you had a serious problem, then in the final analysis you could write a letter to your MP, who would take it up with the Minister. Now, you are no longer a citizen but a consumer, and your utilities are provided by some weird private sector thing, owned by another company, owned by some third company, frequently based abroad, and with its customer services outsourced to yet another company which could be anywhere in the world all. All this involves significant transaction costs for individuals, who are expected to conduct sophisticated cost-effectiveness comparisons between providers, when in fact they just want to turn on the tap and have water come out.
The other is that government (and hence the citizen) loses any capacity for strategic planning. Most nationalized industries in Britain were either created because the private sector wasn't interested, or picked up when the private sector went bankrupt (the railways for example). But without ownership, the capacity to decide what you want and get it is much reduced. You can see that with the example of the Minitel – a proto-internet system given away free by the French government through the state-owned France Telecom in the early 1980s, and years ahead of anything else. You literally couldn't do anything similar now.
John Merryman. , August 4, 2019 at 10:35 am
Taking Michael Hudson's work into account, there is a much deeper and older dynamic at work, of which neoliberalism is just the latest itineration.
A possible explanation goes to the nature of money.
As the accounting device that enables mass societies to function, it amounts to a contract between the individual and the community, with one side an asset and the other a debt. Yet as we experience it as quantified hope, we try to save and store it. Consequently, in order to store the asset, similar amounts of debt have to be created.
Which results in a centripedial effect, as positive feedback draws the asset side to the center of the social construct, while negative feedback pushes the debt to the edges. It could be argued this dynamic is the basis of economic hierarchy, not just a consequence.
Yet money and finance function as the economic blood and arteries, circulating value around the entire community, so the effect of this dynamic is like the heart telling the hands and feet they don't need so much blood and should work harder for what they do get.
Basically we have to accept that while money is an effective medium of exchange, it is not a productive store of value. We wouldn't confuse blood with fat, or roads with parking lots, so it should be possible to learn to store value in tangibles, like the strong communities and healthy environments that will give us the safety and security we presumably save money for.
As a medium, we own money like we own the section of road we are using, or the fluids passing through our bodies. Let the neoliberals chew on that.
tegnost , August 4, 2019 at 11:39 am
Yet money and finance function as the economic blood and arteries, circulating value around the entire community, so the effect of this dynamic is like the heart telling the hands and feet they don't need so much blood and should work harder for what they do get.
nice image of a not so nice dynamic
John Merryman. , August 4, 2019 at 12:34 pm
Thanks. Political persuasion is about keeping it simple. How about; Government was once private. It was called monarchy. Do we want to go back there, or do we need to better understand the balance between public and private? Even houses have spaces that are public and spaces that are private.
pjay , August 4, 2019 at 10:44 am
This is, indeed, an excellent historical overview, evoking some of Kuttner's best writing over the decades. I would recommend it with no hesitation.
On the other hand, Kuttner's American Prospect has also provided cover for some damaging faux-progressive enablers of neoliberalism over those decades (IMHO). A puzzlement.
P S BAKER , August 4, 2019 at 10:45 am
An excellent exegesis – this is going to be my go-to summary from now on. Many thanks.
Sal , August 4, 2019 at 11:20 am
I must remind everyone that Bob Kuttner is no longer what he used to be. Bob Kuttner was against progressive Dem candidates like Bernie in 2016, and was in bed with THE neoliberal candidate ..With the passage of time, Kuttner has evolved into a partisan for the sake of partisanship, instead of being principled.
tegnost , August 4, 2019 at 12:15 pm
after reading your comment I went through the post again and found these suspicious points
"The failure of neoliberalism as economic and social policy does not mean that markets never work. A command economy is even more utopian and perverse than a neoliberal one. The practical quest is for an efficient and equitable middle ground. "
so, get in front of the riot and call it a parade? Maybe a little bit. Also
"Nonetheless, in many sectors of the economy, the process of buying and selling is close enough to the textbook conditions of perfect competition that the price system works tolerably well. Supermarkets, for instance, deliver roughly accurate prices because of the consumer's freedom and knowledge to shop around. Likewise much of retailing . However, when we get into major realms of the economy with positive or negative externalities, such as education and health, markets are not sufficient. And in other major realms, such as pharmaceuticals, where corporations use their political power to rig the terms of patents, the market doesn't produce a cure."
Probably not working so well for the employees or the farm workers who get food on the shelf
I guess maybe not practical to change that dynamic? That said, as history the post is as good as anything else I've seen, and reads well, but maybe does need a grain of salt to make it more palatable.
Camelotkidd , August 4, 2019 at 11:35 am
"Neoliberalism's premise is that free markets can regulate themselves; that government is inherently incompetent, captive to special interests, and an intrusion on the efficiency of the market; that in distributive terms, market outcomes are basically deserved; and that redistribution creates perverse incentives by punishing the economy's winners and rewarding its losers. So government should get out of the market's way."
In an otherwise good article the author makes a fundamental error. As Phillip Mirowski patiently explains in Never Let a Serious Crisis Go to Waste, neoliberalism is not laissez faire. Neoliberal desire a strong government to implement their market based nirvana, as long as they control government.
Hayek's Heelbiter , August 4, 2019 at 11:43 am
The best summation on the failure of neoliberalism I've ever read. Will share widely Still nipping. Maybe one day I'll be able to take a real bite!
shinola , August 4, 2019 at 1:51 pm
"[ .] was used to justify political conservatism, imperialism, and racism and to discourage intervention and reform."
That missing first word could easily be neoliberalism; however, that sentence was actually pulled from a definition of Social Darwinism.
Aug 04, 2019 | www.unz.com
It all began during what I think of as the " Kristallnacht of international law," 30 August September 1995, when the Empire attacked the Bosnian-Serbs in a direct and total violation of all the most fundamental principles of international law. Then there was 9/11, which gave the Neocons the "right" (or so they claimed) to threaten, attack, bomb, kill, maim, kidnap, assassinate, torture, blackmail and otherwise mistreat any person, group or nation on the planet simply because " we are the indispensable nation " and " you either are with the terrorists or with us ". During these same years, we saw Europe become a third-rate US colony incapable of defending even fundamental European geopolitical interests while the US became a third-rate colony of Israel equally incapable of defending even fundamental US geopolitical interests. Most interestingly looking back, while the US and the EU were collapsing under the weight of their own mistakes, Russia and China were clearly on the ascend; Russia mostly in military terms (see here and here ) and China mostly economically. Most crucially, Russia and China gradually agreed to become symbionts which, I would argue, is even stronger and more meaningful than if these two countries were united by some kind of formal alliance: alliances can be broken (especially when a western nation is involved), but symbiotic relationships usually last forever (well, nothing lasts forever, of course, but when a lifespan is measured in decades, it is the functional equivalent of "forever", at least in geostrategic analytical terms). The Chinese have now developed an official, special, and unique expression to characterize that relationship with Russia. They speak of a "Strategic, comprehensive partnership of coordination for the new era."
... ... ...
Empires cannot only trade. Trade alone is simply not enough to remain a viable empire. Empires also need military force, and not just any military force, but the kind of military force which makes resistance futile. The truth is that NO modern country has anywhere near the capabilities needed to replace the US in the role of World Hegemon: not even uniting the Russian and Chinese militaries would achieve that result since these two countries do not have:
1) a worldwide network of bases (which the US have, between 700-1000 depending on how you count)
2) a major strategic air-lift and sea-lift power projection capability
3) a network of so-called "allies" (colonial puppets, really) which will assist in any deployment of military force
neither China nor Russia have any interests in policing the planet or imposing some regime change on other countries. All they really want is to be safe from the US, that's it.
This new reality is particularly visible in the Middle-East where countries like the United States, Israel or Saudi Arabia (this is the so-called "Axis of Kindness") are currently only capable of deploying a military capable of massacring civilians or destroy the infrastructure of a country, but which cannot be used effectively against the two real regional powers with a modern military: Iran and Turkey.
But the most revealing litmus test was the US attempt to bully Venezuela back into submission. For all the fire and brimstone threats coming out of DC, the entire "Bolton plan(s?)" for Venezuela has/have resulted in a truly embarrassing failure: if the Sole "Hyperpower" on the planet cannot even overpower a tremendously weakened country right in its backyard, a country undergoing a major crisis, then indeed the US military should stick to the invasion of small countries like Monaco, Micronesia or maybe the Vatican (assuming the Swiss guard will not want to take a shot at the armed reps of the "indispensable nation"). The fact is that an increasing number of medium-sized "average" countries are now gradually acquiring the means to resist a US attack.
So if the writing is on the wall for the AngloZionist Empire, and if no country can replace the US as imperial world hegemon, what does that mean?
It means the following: 1000 years of European imperialism is coming to an end !
This time around, neither Spain nor the UK nor Austria will take the place of the US and try to become a world hegemon. In fact, there is not a single European nation which has a military even remotely capable of engaging the kind of "colony pacification" operations needed to keep your colonies in a suitable state of despair and terror. The French had their very last hurray in Algeria, the UK in the Falklands, Spain can't even get Gibraltar back, and Holland has no real navy worth speaking about. As for central European countries, they are too busy brown-nosing the current empire to even think of becoming an empire (well, except Poland, of course, which dreams of some kind of Polish Empire between the Baltic and the Black Sea; let them, they have been dreaming about it for centuries, and they will still dream about it for many centuries to come ).
Now compare European militaries with the kind of armed forces you can find in Latin America or Asia? There is such a knee-jerk assumption of superiority in most Anglos that they completely fail to realize that medium and even small-sized countries can develop militaries sufficient enough to make an outright US invasion impossible or, at least, any occupation prohibitively expensive in terms of human lives and money (see here , here and here ). This new reality also makes the typical US missile/airstrike campaign pretty useless: they will destroy a lot of buildings and bridges, they will turn the local TV stations ("propaganda outlets" in imperial terminology) into giant piles of smoking rubble and dead bodies, and they kill plenty of innocents, but that won't result in any kind of regime change. The striking fact is that if we accept that warfare is the continuation of politics by other means, then we also have to admit, that under that definition, the US armed forces are totally useless since they cannot help the US achieve any meaningful political goals.
The truth is that in military and economic terms, the "West" has already lost. The fact that those who understand don't talk, and that those who talk about this (denying it, of course) have no understanding of what is taking place, makes no difference at all.
...Indeed, if the Neocons don't blow up the entire planet in a nuclear holocaust, the US and Europe will survive, but only after a painful transition period which could last for a decade or more. One of the factors which will immensely complicate the transition from Empire to "regular" country will be the profound and deep influence 1000 years of imperialism have had on the western cultures, especially in the completely megalomaniac United States ( Professor John Marciano's "Empire as a way of life" lecture series addresses this topic superbly – I highly recommend them!): One thousand years of brainwashing are not so easily overcome, especially on the subconscious (assumptions) level.
peterAUS , says: August 1, 2019 at 3:55 am GMT
The scalpel , says: Website August 1, 2019 at 4:19 am GMT
.no less pathological a revival of racist/racialist theories .
. the current megalomania ("We are the White Race! We built Athens and Rome! We are Evropa!!!") .
. the current waves of immigrants are nothing more than a 1000 years of really bad karma returning to where it came from initially..
Good to know.
Biff , says: August 1, 2019 at 5:08 am GMT
what does the collapse of the AngloZionist Empire really mean?
It means civil war, very likely nuclear civil war
Well, the number one factor keeping empire in a hegemonic stance is the hegemonic U.S. dollar. The empire isn't going anywhere as long as the dollar remains as the worlds reserve currency. Most of planetary trade goes through Brussels and Wall Street denoted in dollars. Most of the credit cards carried and used around the world are SWIFT creations.Tom67 , says: August 1, 2019 at 5:39 am GMT
How and where this will change will be more telling than where the military loses its last battle.
A usual tour de force by the Saker. But one can see things also very differently.hunor , says: August 1, 2019 at 5:47 am GMT
– Western Imperialism: the Holy Roman Empire never had any colonies. Nor did any of the Eastern European states. Nor did the Italians states save for the farcical attempts of Mussolini
– Whas the Turkish empire also due to the Frankish imperialistic popish impulse?
– What the Saker is talking about here are basically GB, France and Holland.
– What about the Russian Empire? What was it but a colonial enterprise? And will rump Russia endure? I have my doubts. Putin ended the Chechen war by giving Chechnya de facto if not de jure self governance. Right now things are okey dokey as Russia is bribing Kadyrov and Kadyrov and Putin having a special personal relationship. But what if circumstances change? Putin not being there any more and some new Russian government tries to enforce its writ in Chechnya? On top there is the birthrate in the Caucasus which is two times the Russian birthrate. Will all those different nationalities still feel bound to Russia in the future? And will Russians be willing to subsidise the Caucasus for ever?
– The "symbiosis" between Russia and China is laughable. As soon as the Anglo-Zionist empire really collapses the differences between Russia and China will come to the fore.
To get China´s help after the Ukraine crisis Russia had to give China a free hand in Mongolia. Before Russia had always seen to it that Mongolia didn´t get too dependent on China. Half of the foreign exchange of Mongolia was earned by the Russian-Mongolian copper mine of Erdenet. Three years ago Russia sold its share in Erdenet. By now Erdenet has been pledged by Mongolias venal politicians as collateral for Chinese loans.
Also China has certainly never forgot that the Russian far East was part of the Qing empire until the 1850s.Tthis will be brought up again as soon as Russia is sufficiently weak.
Russia was forced into the alliance with China by the West. The only industrial sphere where Russia does indeed have world class expertise is in armaments. After Ukraine Russia was forced to share its technology with China. And China will definately put this new knowledge to good use and in the not so far future overtake Russia in this particular field of expertise. Then watch what will happen.
– China not interested in old fashioned imperial politics. That is laughable as well. China has a base in Ceylon now that they got as collateral for a loan that Ceylon couldn´t repay. China is laying claim to the whole South China sea and even parts of the 200 mile zones of countries like the Philipines, Indonesia and Vietnam. To back up these claims with military muscle they build navy bases all over the Spratley islands
– China is getting more and more carbon hydrates through pipelines from Central Asia. At the same time it is mass imprisoning its Turkic population (Uyghus, Kazakhs and Kirgiz). The way the Chinese treat those people is exactly racist in the way the Saker has described the European relationship to the rest of the world. If you are a businessman in any one of those countries you will not be allowed to interact with people of the same faith, culture and almost the same language who live just across the border in Xinjiang.
The Chinese government has seen to the fact that any member of those minorities lives in mortal fear of any contact with foreigners. Any business must now be conducted only with ethnic Chinese. And as as a Kirghiz or Kazakh national you are not distuingishable from a Kirgiz or Kazakh from Xinjiang you will suffer the same indignities as them when you travel to Xinjiang.
As venal and corrupt as the elites of the "Stans" might be: even they perceive Chinese actions in neighbouring Xinjiang as so grossly offensive that they hardly hide their disdain anymore. In fact I talked to a journalist last week who was present at the latest SCO gathering in Bishkek. She was astonished at the level of Sinophobia she accountered.
So on the one hand China is in the process of acquiring more and more of the ressources of the Stans. But on the other hand it is worsening its relationship with the peoples of these countries.
The Stans are still ruled by the same Soviet nomenklatura. There has been no real change. The question is how stable this arrangement is. It definately fits the requirement of the Chinese but the longer this lasts the more the elites of the Stans are coming between China and their own population.
China is well aware of this. To protect its investment it might have to use force in the future. And that is what I expect to happen in case one of those pipelines is interrupted. Not so different from what the West is doing in the Middle East. All that talk of the Saker about "good" and "bad" civilisations and promised land once the Anglo-Zionist ascendancy is over is just that: empty words.
In reality Nitzsche is still right: States are the coldest of cold monsters.
It is incredibly , wickedly absurd and naïve to even think that , what you call an empireanon  Disclaimer , says: August 1, 2019 at 9:13 am GMT
will go down without a world shattering fight.
It is mindless ignorance not to notice the handwriting on the wall.
This entity you call empire , has been preparing for this event for centuries.
They are telling it in our face directly , " new world order", " full spectrum domination"
They have what nobody else has , a proactive plan, a global network of military bases, and
the scariest part is the fact , that they have no moral barriers to say that, it is not going to be a fair fight. No hold barred ! No laws ! No rules of engagement! The end justifies the means !
On the end they will not win in fact nobody will .
But the old must die for the new to be .
Our desire to become brought us to this point , it was an exiting ride , but the new humans
will have a " climate change " of consciousness .
That is not a silly hope , that is logic based clearly on design.
Both US Americans and Europeans will, for the very first time in their history, have to behave like civilized people, which means that their traditional "model of development" (ransacking the entire planet and robbing everybody blind) will have to be replaced by one in which these US Americans and Europeans will have to work like everybody else to accumulate riches.
Most Americans don't get to collect welfare. Most Americans have to get jobs and pay for stuff. Most Americans who work do NOT accumulate riches – they go broke. Probably the elite .01% – guys like Jeff Bezos and Jeff Epstein and Bernie Madoff – can get rich and accumulate riches. That is not "AngloZionist." It's just Zionist.
Aug 03, 2019 | www.moonofalabama.org
Passer by | Aug 2 2019 23:39 utc | 30karlof1 , Aug 2 2019 23:55 utc | 31
I will mention this again, to see what people here think, as they are intelligent people. I sent mails to Russian and Chinese authorities about this.
"I will provide you with possible reasons behind the current trade wars and rejection of globalisation by the US. In short, they think that they will save their hegemony, to a certain degree, that way.
There are long term GDP Growth and Socioeconomic Scenarios developed by the Intergovernmental Panel on Climate Change, the OECD, and the world scientific community. They are generally used to measure the impact of Climate change on the World. In order to measure it, Socioeconomic Scenarios were developed, as the level of economic growth in the world is very important for determining the impact of Climate Change in the future. High growth levels will obviously affect Climate Change, so these GDP estimates are important. The scenarios are with time horizon 2100.
For more on this you can check these studies here, some of the many dealing with this topic. They describe the scenarios for the world.
There are 5 main scenarios, or "Shared Socioeconomic Pathways". All of them describe different worlds.
- SSP 1 - Green World, economic cooperation, reduced inequality, good education systems. High level of economic growth, fast catch up of the developing world with the developed world. High level of multipolarity.
- SSP 2 - More of the same/ Muddling through - continuation of the current trends. Relatively high level of economic growth, relatively fast catch up of the developing world with the developed world. Good level of multipolarity.
- SSP 3 - Regional Rivalry - nationalisms, trade wars, lack of global cooperation, fragmentation of the word, environmental degradation. Low levels of economic growth everywhere, the developing world remains poor and undeveloped. Low level of multipolarity, West retains many positions.
- SSP 4 Inequality - depicts a world where high-income countries use technological advances to stimulate economic growth; leading to a high capacity to mitigate. In contrast, developments in low income countries are hampered by very low education levels and international barriers to trade. Growth is medium, the catch up process between the developing world and the developed world is not fast. Medium level of multipolarity.
- SSP 5 Economic growth and fossil fuels take priority over green world - High levels of economic growth, fast catch up of the developing world with the developed world. High level of multipolarity.
See SSP 3. A world of rivalry, trade wars, trade barriers, lack of global cooperation, and fragmentation, will lead to lower level of growth in the developing world, and thus a slow catch up process. Multipolarity in such a world is weak as the developing world is hampered.
In other words, a world of cooperation between countries will lead to higher economic growth in the developing world, faster catch up process, and thus stronger multipolarity.
Low cooperation, fragmented world, high conflict scenarios consistently lead to low growth in the developing world and thus to the US and the West retaining some of its positions - a world with overall bad economy and low level of multipolarity.
Basically, globalisation is key. The developing world (ex West) was growing slowly before globalisation (before 1990). Globalisation means sharing of technology and knowledge, and companies investing in poorer countries. Outsourcing of western manufacturing. Etc. After globalisation started in 1990, the developing world is growing very well. It is globalisation that is weakening the relative power of the West and empowering the developing world. The US now needs to kill globalisation if it is to stop its relative decline.
So what do we see: exactly attempts to create the SSP 3 scenario. Trade wars, sanctions, attacks on multilateral institutions - the WTO, on international law, on the Paris Climate Change Agreement (which if accepted would put constraints on the US economy), on the UN, bullying of Europe, lack of care for european energy needs, support for Brexit (which weakens Europe), crack down on chinese students and scientists in the US, crack down on chinese access to western science data, demands to remove the perks for poor countries in the WTO, etc. This is hitting economic growth in the whole world and the global economy currently is not well. By destroying the world economy, the US benefits as it hampers the rise of the developing nations.
US President Trump does not do that in order to dismantle the dollar or US hegemony because of so called isolationism, as some may think. Trump does that in order to save US hegemony, implementing policies, in my opinion, devised by the US military/intelligence/science community. They now want to hamper globalisation and create fortress US, in order to bring back manufacturing and save as much as possible of the US Empire. Chaos and lack of cooperation in the world benefit the US. They now realise globalisation no longer serves the US as it leads to the rise of developing nations. Thus they no longer support it and even sabotage it."Passer by | Aug 3 2019 0:06 utc | 32
You ask, "The concept of multilateralism is not completely clear to me in relation to the global public/private finance issue and I am not of faith but of questions...."
Wikileaks definition :
"In international relations, multilateralism refers to an alliance of multiple countries pursuing a common goal."
The key point for the Chinese during negotiations as I understand them via their published White Paper on the subject is development and the international rules put in place at WTO for nations placed into the Developing category, which get some preferential treatment to help their economies mature. As China often reminds the global public--and officials of the Outlaw US Empire--both the BRI and EAEU projects are about developing the economies of developing economies, that the process is designed to be a Win-Win for all the developing economies involved. This of course differs vastly from what's known as the Washington Consensus, where all developing economies kowtow to the Outlaw US Empire's diktat via the World Bank and IMF and thus become enslaved by dollar dependency/debt. Much is written about the true nature of the Washington Consensus, Perkins Confessions of an Economic Hit Man and Klein's Disaster Capitalism being two of the more recent and devastating, and many nations are able to attest to the Zero-sum results. The result is very few nations are willing to subject their economies to the pillaging via Washington Consensus institutions, which Hudson just recently reviewed.
The Empire is desperate and is looking for ways to keep its Super Imperialism intact and thus continue its policy aimed at Full Spectrum Dominance. But the Empire's abuse of the dollar-centric institutions of international commerce has only served to alienate its users who are openly and actively seeking to form parallel institutions under genuine multilateral control. However as Hudson illustrates, Trump doesn't know what he's doing regarding his trade and international monetary policies. Today's AP above the fold headline in Eugene's The Register Guard screamed "Trump threatens 10% tariffs;" but unusually for such stories, it explains that the 10% is essentially a tax on US consumers, not on Chinese companies, which provides a message opposite of the one Trump wants to impart--that he's being tough on the Chinese when the opposite's true. China will continue to resist the attempts to allow the international financial sharks to swim in Chinese waters as China is well aware of what they'll attempt to accomplish--and it's far easier to keep them out than to get them out once allowed in, although China's anti-corruption laws ought to scare the hell out of the CEOs of those corps.
The Empire wants to continue its longstanding Open Door policy in the realm of target nations opening their economies to the full force of Imperial-based corps so they can use their financial might to wrestle the market from domestic players and institute their Oligopoly. China already experienced the initial Open Door (which was aimed at getting Uncle Sam's share of China during the Unequal Treaties period 115 years ago) and will not allow that to recur. China invokes its right under WTO rules for developing economies to protect their financial services sector from predation; the Empire argues China is beyond a developing economy and must drop its shields. We've read what Hudson advised the Chinese to do--resist and develop a publicly-based yuan-centered financial system that highly taxes privatized rent-seekers while keeping and enhancing state-provided insurance--health, home, auto, life, etc--while keeping restrictions on foreign land ownership since it's jot allowed to purchase similar assets within the domestic US market.
The Outlaw US Empire insists that China give so it can take. Understandably, China says no; what we allow you to do, you should allow us to do. Trump and his trade negotiators continue to insist on China agreeing to an unequal trade treaty. Obviously, the latest proposal was merely a repetition of what came before and was rejected as soon as the meeting got underway, so it ended as quickly as it started. IMO, China can continue to refuse and stand up for its principles, while the world looks on and nods its head in agreement with China as revealed by the increasing desire of nations to become a BRI partner.
It should be noted that Trump's approach while differing from the one pushed by Obama/Kerry/Clinton the goal is the same since the Empire needs the infusion of loot from China to keep its financial dollarized Ponzi Scheme functioning.
Russia's a target too, but most of its available loot was already grabbed during the 1990s. D-Party Establishment candidates have yet to let it be known they'll try to do what Trump's failing to do, which of course has nothing to do with aiding the US consumer and everything to do with bolstering Wall Street's Ponzi Scheme.karlof1 , Aug 3 2019 0:19 utc | 34
karlof1 , Aug 2 2019 23:55 utc | 31
Good comment, karlof1 , i think that the attack against China is attack against the heart of multipolarity. It will be good if b could post about the escalation of the trade war. This is important. The US clearly intends to resist multipoarity, and tries to stop it.William Gruff , Aug 3 2019 0:28 utc | 35@ karlof1 with the response...thanksPasser by @30--
If I would have had my act together last night I would have posted another link fro Xinhuanet (can't find now) about how China wants to retain developing nation status and provides as data that the (I think) per capita GDP had gone down....gotten worse in relation to the US per capita GDP.
I keep going back to believing that multilateralism is a code word for no longer allowing empire global private finance hegemony and fiat money.
The continuing practice of Neoliberalism by the Outlaw US Empire and its associated corporations and vassal nations checkmates what you think Trump's trying to accomplish. Hudson has explained it all very well in a series of recent papers and interviews: Neoliberalism is all about growing Financial Capitalism and using it to exert control/hegemony on all aspects of political-economy.
Thus, there's no need to sponsor the reindustrialization that would lead to MAGA. Indeed, Trump hasn't proposed any new policy to accomplish his MAGA pledge other than engaging in economic warfare with most other nations. His is a Unilateral Pirate Ship out to plunder all and sundry, including those that elected him.
In your outline, it's very easy to see why BRI is so attractive to other nations as it forwards SSP1. Awhile ago during a discussion of China's development goals, I posted links to its program that's very ambitious and doing very well with its implementation, the main introduction portal being here .psychohistorian @11 asked: "The concept of multilateralism is not completely clear to me in relation to the global public/private finance issue and I am not of faith but of questions...."Passer by , Aug 3 2019 0:32 utc | 36
karlof1 @31 covered it pretty well I think, but I want to try to answer in just a couple sentences (unusual for me).
Global private finance is driven by one thing and one thing only: making maximum profits for the owners quarter by financial quarter. Global public finance is driven by the agendas of the nations with the public finance, with profits being a secondary or lesser issue.
This boils down to private finance being forever slave to the mindless whims of "The Market™" (hallowed be Its name), while public finance is, by its nature, something that is planned and deliberated. Nobody can guess where "The Market™" (hallowed be Its name) will lead society, though people with the resources like placing bets in stock markets on the direction It is taking us. On the other hand, if people have an idea which direction society should be heading in, public control over finance is a precondition to making it so.Posted by: karlof1 | Aug 3 2019 0:19 utc | 34
"The continuing practice of Neoliberalism by the Outlaw US Empire"
I'm not sure this will be the case anymore -
Former heads of DHS and NSA explain how the U.S. can keep Huawei at bay
"Perhaps more importantly, this proposal demonstrates one way the U.S. can reinforce elements of what the government calls the “national technology and industrial base” (NTIB), the collection of companies who design, build and supply the U.S. with vital national-security related technologies."
Aug 03, 2019 | www.moonofalabama.org
vk , Aug 3 2019 14:18 utc | 91@ Posted by: Hor, Jennifer | Aug 3 2019 11:33 utc | 77
The Nordic nations became rich welfare states in the post-war for different reasons.
Sweden already was a rich kingdom/country since the end of the 18th Century. In both WW it managed to stay neutral, so it went through them relatively unscathed.
Norway was a very poor country until North Sea oil was discovered at the beginning of the 1980s.
I don't know the case of Denmark.
Finland was a poor country which was basically rebuild from zero in the aftermath of WWII, thanks to the neutrality pact between the USA and the USSR. It was decided that Finland would be a very prosperous country, without many inner social contradictions, in exchange for absolute neutrality during the Cold War.
Iceland was very frugal, simple and classless village of fishermen that suddenly became very prosperous after the 1990s thanks to the sudden expansion of the world banking sector.
You see, all these countries became prosperous for different reasons. But what they all had in common was:
1) they all had relatively strong socialist parties/well-organized working classes in the aftermath of the WWII (except Iceland); and
2) all of them were insignificant countries in a very significant geographic location (frontier between Iron Curtain and Western Europe). Iceland's case is emblematic in this aspect, since it won the Cod Wars against a much more powerful enemy (the UK) solely on its geography (as the main outpost of the GIUK gap).
To put it simply, the countries which managed to create "welfare states" were countries usually at the cordon sanitaire area that, in a very smart and eventful way, managed to successfully use both superpowers to extract maximum wealth from an USA that, at the time, still had the material means to make small countries rich and prosperous (Taiwan and South Korea were the most emblematic cases in this aspect: both begun their respective industrialization essentially by blackmailing the USA and the USA/Japan, respectively).
As we well know now, the welfare state quickly evaporated when:
a) the USA begun to degenerate economically after the "stagflation" crisis (triggered by the oil crisis of 1974-5) that effectively destroyed the prestige of Keynesianism in the West and paved the way to the rise of Neoliberalism as the new main capitalist doctrine (Neoliberalism existed since the 1930s). According to the Keynesian "theory", stagflation was impossible, since supply should always equal demand (so, when unemployment falls, inflation goes up and vice versa). Stagflation saw both high unemployment and high inflation. Capitalism's "lifeblood" is the profit rate, and as those begun to fall, America begun to impose a series of financial weapons which undermined the spreading of the social-democrat consensus of the post-war, in a process that culminated with the Plaza Accord (1985) – which killed Japanese and German industrialization.
b) the USSR was destroyed from within in 1991, ending the menace from without and, thus, the working classes of the cordon sanitaire area main leverage against the capitalists of their own country. The USA now is the world solitary superpower and can do what it pleases.
Aug 03, 2019 | turcopolier.typepad.com
ted richard , 03 August 2019 at 01:22 PMHongkong is no longer of great importance for bejing as a financial and trading locus. up and down the south china sea coast are many cities of far greater importance than Hongkong.
perhaps when the PLA finish in hongkong they can come over here and deal with antifa since our government at any level does not appear to have the sense or spine to do it themselves
Aug 03, 2019 | www.zerohedge.com
(Edited version of the speech given by the TJ Wormwood, Chief Demonic Officer – Finance, Lord of 3rd Ring of the 7th Circle, to invited audience at Davos.)
As you all know, I've been wrecking finance for millennia. [Pause for effect]
Nearly every major big idea, evolutionary leap forward, invention and discovery has improved the miserable lot of mankind only through their ability to monetise it. Forget the theft of fire – being able to monetise fire by attracting pretty and willing mates around a warm campfire, or cooking the food others have hunted, is what mattered. Strip out the noise, and the rise of mankind is largely due to improvements in the efficiency and ease of means of exchange.
From the realisation hunters could barter their furs for other goods, to the rise of complex products to finance global growth – the innovation of financial markets has been a major driver of success for the Other Side in raising the wellbeing and prosperity of mankind. Pretty much anything that holds back or disrupts trade, increases costs and holds back services is naturally positive for our goal of global destabilisation.
So, here is the big plan:
Since 2007 we've been turning the Other Side's successful innovation of financial markets against them. Global Financial Markets are incredibly rich in opportunities to distort truth, hide lies, and undermine mankind – generating immediate greed, envy, suspicion and anger. We've uncovered previously unimaginable ways in which to financially screw the World with consequences that impact everyone.
We've overlaid the programme with our mastery and understanding of temptation, human greed, avarice and pride, while adding subtlety and cunning. We merely suggest and advise. We are facilitating the train-wreck of the global economy by destroying asset values while confounding their understanding of money and wealth – the pillars of their society.
At its simplest form we are manipulating and driving constant market instability to keep mankind distracted. Uncertainty clouds their future expectations – so we keep it raining. A Mortgage crisis one year, followed by a Sovereign Debt crisis the next, spiced with a couple of bank failures, and threats of global trade war. Overlay with confusion and distraction such as social media, fake news, Bitcoin and populism, and it all works rather well.
Keep their leaders arguing. Keep the blame game going.
Our success can be seen in current financial asset prices. These are now hopelessly inflated and distorted by foolish post financial crisis policy decisions. They are bubbles set to pop. Empower the regulators and bureaucrats to compromise finance through zealous over-regulation, making banking safer by destroying it. Usher in a new era of trade protectionism, the end of Free Trade and increase the suspicion some countries are manipulating their currencies for economic advantage. Sprinkle some dust of political catastrophe, the collapse of law, undo the fair, just and caring society, while adding some eye of newt and complex environmental threats. Make the rich so rich they don't notice, and the poor so poor they become invisible. If the markets remain uncertain, then it distracts mankind from addressing these issues, making society less stable!
There as some things we're really proud of, including the Euro, Social Media, Investment Banks, the Tech Boom, and especially Quantitative Easing (which is still delivering confusion and pain). New Monetary Theory could prove even better – it shows tremendous potential to thoroughly unsettle confidence in money. Cybercurrencies are particularly fun – despite coming up with the idea, neither we, nor even the distinguished members of our panel of eternal guests, understand the why of them. They are libertarian nonsense – so, naturally we continue to encourage them as get-rich-quick schemes, but they also further undermine confidence in money and government. We made something up in a bar one night and called it a Distributed Ledger - the humans ran with it and invented Blockchain, whatever that might be..
Some of the other stuff we've encouraged, such as The EU, ETFs, Hi-Frequency Trading, Neil Woodford and Deutsche Bank look likely to be highly effective vectors of short-term economic destruction and destabilisation, triggering systemic market events and regulatory backlashes across markets. We are only now exploring the full potential of market illiquidity to rob billions of pensioners of their savings.
We've persuaded investors to overturn proven tried and tested investment strategies and wisdoms, nurturing a whole range of overpriced unprofitable US Tech "Unicorn" companies which we are confident will prove utterly over-hyped and largely worthless. The success of social media, data mining and new tech has increased levels of dissatisfaction and envy – especially in our target younger demography.
The way we successfully pinned the blame on banks for the Global Financial Crisis – despite the fact it was people who wanted mortgages to buy houses and fast cars - ensured global regulators would over-react. We've allowed regulators to focus on banks while we target the next financial crisis in other parts of the financial ecosystem.
Regulators forced the banks to de-risk. But risk does not disappear - it just goes somewhere else. While banks understood risk and had massive staffs to manage risk, risk is now concentrated in the hands of "investment managers" who are singularly ill-equipped to withstand the next credit crunch and global recession, (which we've planned for next October – Save the Date cards have been sent).
We are particularly pleased that many banks now exceed the 2.3 compliance officers for every profitable banker ratio. Compliance and regulatory costs now exceed 10% of income at some European banks – a stunning success and substantially decreasing the efficiency of banking and exchanges.
We've some great new financial ideas we are still experimenting with, some of which show great promise for further weakening society. Facebook Money is going to be a cracker, and I particularly like the Spaceship to Mars project if only they knew what awaits them
By hiding inflation in the stock market, we assisted the accumulation of massive wealth by a tiny percentage of the population to ferment income inequality dissatisfaction. When capital is concentrated and the workers under the cosh, it creates all the right conditions for weak disjointed government to aid and abet the rise of destabilising populism.
It's highly satisfying to watch the instability we've created in financial markets drive fear and distrust across society. The debt crisis we engineered led to global financial austerity, job insecurity, and rising inequality. We were surprised how easily we pushed the Gig economy concept to further exploit and cow workers through regulators and authorities – they barely noticed. Over this we've layered whole new levels of anxiety such as the unknowns of data theft, the rise in envy coefficients through social media, fake news while fuelling social distrust through resentment.
We've managed to persuade Governments to follow damaging and contradictory policies. As society reeled in the wake of the financial crisis, we persuaded policy makers to cut back spending through "austerity" spending programmes, simultaneously bailing out bankers while flooding the financial economy with free money through Quantitative Easing.
Effectively we've split the world into two economies. A real economy which is sad, miserable and deflating, and a financial economy that's insanely optimistic, massively inflated and ripe to pop on the back of free money.
The resentment, instability, fear and general sense of decay has paid dividends in our drive to break society by undermining the credibility of the political classes. Our approach to politics has been simple – deskill the political classes, reduce their effectiveness as leaders, while engineering economic, social and financial instability to drive rampaging populist politics – just like in 1932! Populism may ultimately prove short-lived, but it's difficult to see how the political classes will recover their power in time to reverse the damages being done to the global environment.
While markets have burned, society become increasingly riven, and politics has failed, we've distracted the humans from the rising levels of carbon dioxide in the atmosphere which threatens to create global warming and rising sea levels, while plastics poison the oceans and soil erosion threatens agriculture.
Now I love the ravenous hunger and sharp pointy teeth of polar bears as much as the next demon, but needs must... needs must. I was also rather fond of the dinosaurs...
Our approach to ensuring destructive climate change has proved very effective. We've supported, financed and advised the loudest green lobbies to ensure their message looks ill-considered, wrong and economic suicide. We also paid big bucks to fund the loudest climate change deniers. Our innovation of fake news to discredit and mitigate anything positive means climate change remains a crank topic – even as our polar bears drown.
Meanwhile, through our dominance of global boardrooms and investment firms, we've made sure that large corporates have bought-out and stifled new technologies that could solve the environmental crisis.
Our future looks great – because their future is bleak!
Thank you for your kind attention.
Demonic Chief Office – Finance
Aug 03, 2019 | economistsview.typepad.com
Christopher H. , July 23, 2019 at 03:27 PMhow those like kurt who mock economic anxiety are wrongChristopher H. said in reply to Christopher H.... , July 23, 2019 at 03:28 PM
The overwhelming correlation between austerity and Brexit
July 22, 2019
Across the pond, the Brexit disaster continues to unfold in newly disastrous ways. Theresa May has resigned as prime minister, and the Trump-esque Boris Johnson looks like a lock to replace her. Parliament members -- up to and including Johnson's own fellow Conservatives -- are panicking that the new prime minister may try hardline tactics to force Brexit through, plan or no plan.
At this point, predicting how this mess will end is a fool's errand. But there are still lessons to be learned from how it began.
In particular, the Conservatives might want to look in the mirror -- and not just because it was their government that called the Brexit vote in the first place. It turns out the brutal austerity they imposed on Britain after the global 2008 financial crisis probably goes a long way towards explaining why Brexit is happening at all.
In the run-up to the Brexit referendum in 2016, much of the campaigning in favor of "Leave" was unabashedly racist. Hard-right political groups like the U.K. Independence Party (UKIP) painted a picture of native Britons overrun by hordes of foreign immigrants that were straining the country's health care, housing, public services, jobs and wages to the breaking point. The thing is, the racism was a particular poisonous way of framing a very real underlying economic fear: all those necessities really had become harder to come by.
Yet, as it is in America, actual evidence linking influxes of immigrants to rising scarcity in jobs and wages and other services is scarce. But something else had also recently happened that could explain why hospitals and schools were closing and why public aid was drying up: massive cuts to government spending.
A decade ago, the aftershocks of the global financial crisis had shrunk Britain's economy by almost 3 percent, kicking unemployment up from 5 percent to 8 percent by 2010. Under then-Prime Minister David Cameron, the Conservatives in power concluded that "confidence" among investors was necessary to restore economic growth -- and that meant cuts to government spending to balance the budget.
Thus the Conservatives pushed through a ferocious austerity package: Overall government spending fell 16 percent per person. Schools, libraries, and hospitals closed; public services like garbage collection ground to a halt; poverty shot up; and homelessness doubled. Despite unemployment staying stubbornly high and GDP growth staying stubbornly low -- in defiance of their own economic theory -- the Conservatives crammed through even more reductions in 2012. "It is hard to overestimate how devastating Cameron's austerity plan was, or how fast it happened," the British journalist Laurie Penny observed. A United Nations report from last year called the cuts "punitive, mean-spirited, and often callous."
But the damage was not evenly distributed across the country. At the district level -- Britain's units of local governance -- the reductions in spending ranged from 6.2 percent to an astonishing 46.3 percent from 2010 to 2015. The districts that were already the poorest were generally the hardest hit.
These differences across districts allowed Thiemo Fetzer, an associate professor of economics at the University of Warwick, to gauge the correlation between the government cuts and whether a district voted Leave or Remain. "Austerity had sizable and timely effects, increasing support for UKIP across local, national, and European elections," Fetzer wrote in a recent paper. He found that UKIP's share of a district's vote jumped anywhere from 3.5 to 11.9 percentage points in correlation with austerity's local impact. "Given the tight link between UKIP vote shares and an area's support for Leave, simple back-of-the-envelope calculations suggest that Leave support in 2016 could have been easily at least 6 percentage points lower," Fetzer continued. As tight as the Brexit referendum was, that alone could have been enough to swing it.
Other studies have shown links between how a local British community's economic fortunes fared and how it voted for Brexit as well. Economists Italo Colantone and Piero Stanig found that support for Leave was "systematically higher" in the regions of the country hit hardest by trade with China over the last three decades. Another analysis by Torsten Bell showed a strong correlation between British income inequality as of 2015 and Brexit support, with higher local vote shares for Leave the lower the local incomes were. (It's worth noting the Bell didn't find a correlation with Brexit when he looked at how local incomes changed from 2002 to 2015, but that's also a weird time frame to choose, as it mashes together a period of wage growth before 2008 with a major drop afterwards.)
Inequality in Britain had been worsening for decades, as the upper class in the City of London pulled further and further ahead of the largely rural working class, setting the stage for Brexit. And then austerity fell hardest on the shoulders of the latter group, compounding the effect.
"Individuals tend to react to the general economic situation of their region, regardless of their specific condition," Colantone and Stanig wrote. But Fetzer was able to break out some individual data in his analysis of austerity, and he found a correlation with Brexit votes there as well. Individual Britons who were more exposed to welfare state cuts -- in particular a reduction in supports for housing costs -- were again more likely to vote for UKIP. "Further, they increasingly perceive that their vote does not make a difference, that they do 'not have a say in government policy' or that 'public officials do not care,'" Fetzer observed.
It isn't that the economic dislocation of the 2008 crisis and the ensuing austerity crunch made Britons more racist. By all accounts, half or more of the country has consistently looked askance on immigration going back decades. (Indeed, international polling suggests a certain baseline dislike for immigration is a near-universal human condition.) What changed in the last few years was the willingness of certain parts of British society to act politically on those attitudes. And that, arguably, is where the economics come in.
Work from the Harvard economist Benjamin Friedman is instructive here. He found that periods of economic growth, where people feel the future is bright, make national populations more open, generous, and liberal. Times of economic contraction and stagnation have the opposite effect.
The British people, like everyone everywhere, are a mix of good and evil impulses. But by decimating public investment in a self-destructive quest for investor-led growth, the British government created a monster from those impulses. And the reckoning for that terrible error is still unfolding.if - what should I call them? centerists? - like Krugman, Kurt and EMike really cared about racism they'd be in favor of ambitious programs so that voters' living standards rise.JohnH -> Christopher H.... , July 23, 2019 at 03:33 PM
Instead they push incrementalism and make excuses about Dems never having any power.Tut! Tut! Tut! It's not politically correct for Democrats to talk about the economy, inequality, and dislocation, is it? If people keep raising the issue, Democrats might be forced into acknowledging problems they helped to create. Worse, they might have to craft a coherent economic message that their Big Money puppeteers might not like! OMG!!! Armageddon!!!Joe -> Christopher H.... , July 23, 2019 at 04:08 PMHe presented no evidence, just pundicizing based on priors.Christopher H. said in reply to Joe... , July 23, 2019 at 06:10 PM
Well I looked and could find no change in growth, it has been declining steadily since 1990, and the ten years has been correspondingly dropping since 1980.
So, I I am supposed to see evidence, then cite the chart I am supposed to look at. We are tired of useless pundicizers.no he is presenting the agreed-upon evidence. Austerity hurt the UK.Joe -> Christopher H.... , July 24, 2019 at 03:15 AM
Cranks like you have no place in the discussion. Go entertain yourself somewhere else.No, he would have cited evidence.kurt -> Joe... , July 25, 2019 at 10:45 AM
If he had any brains he would have recognized that we got the secstags going around, meaning the one cannot just look at the eight year recession cycle, one has to look at the full monetary cycle.
It is easy to tell the dufas among economists, they never look at nor cite any data.
For example, Krugman ignored the fact that Obamacare raised monthly taxes about $500 per household, lost four elections, proved himself a dolt and now want to write off Obamacare. Never once did Krugman make any attempt to correlate the Obamacare taxes with election losses, not once. He preferred the delusion, same as most of our favorite economists, I can count the one who actually look.
As Kurt said, being delusional hysterical freaks who send hundreds of billions to wealthy people then complain? Stupid,stupid stupid.You are exactly right here - Obamacare subsidies should have tapered off or been taxed away around the top 20% of income rather than the top 60. Big mistake - but it was a compromise to get several republicans to vote yes, but they (the Rs) negotiated in bad faith and then didn't do what they promised. But hey - when have the H brothers let facts get in the way of what they know, know, know about me.Christopher H. said in reply to kurt... , July 25, 2019 at 07:03 PMJoe said nothing of the kind.
The Rs didn't do what they promised? What did you expect?
you're a naive sucker
Aug 02, 2019 | economistsview.typepad.com
anne , August 02, 2019 at 04:21 AMhttp://cepr.net/blogs/beat-the-press/does-the-new-york-times-have-an-editing-program-that-automatically-puts-free-before-trade
August 1, 2019
Does the New York Times Have an Editing Program that Automatically Puts "Free" Before "Trade?"
By Dean Baker
Readers must be wondering because it happens so frequently in contexts where it is clearly inappropriate. The latest example is in an article * about the state of the race for the Democratic presidential nomination following the second round of debates.
The piece told readers:
"After a few candidates used the Detroit debate to demand that Mr. Biden account for Mr. Obama's record on issues such as deportations and free trade, Mr. Biden was joined by some of the former president's advisers, who chastised the critics for committing political malpractice."
The word "free" in this context adds nothing and is in fact wrong. The Obama administration did virtually nothing to promote free trade in highly paid professional services, like physicians services, which would have reduced inequality. It only wanted to reduce barriers that protected less educated workers, like barriers to trade in manufactured goods.
And, it actively worked to increase patent and copyright protections, which are the complete opposite of free trade. These protections also have the effect of increasing inequality.
Given the reality of trade policy under President Obama it is difficult to understand why the New York Times felt the need to modify "trade" with the adjective "free." Maybe it needs to get this editing program fixed.
Aug 02, 2019 | economistsview.typepad.com
JohnH , July 22, 2019 at 10:03 PMThe Democratic leadership and their megaphones in the media refuse to consider the possibility that 'free' trade deals had anything to do with rising income inequality and the resentment that led to Trump's election. It's much easier to promote the notion that hapless Hillary's loss could be pinned on Putin or on racism and to dismiss Trumps voters as hopeless deplorables.RC (Ron) Weakley said in reply to JohnH... , July 23, 2019 at 04:40 AM
However, Dean Baker noted last week: "The basic point is a simple one that has a long pedigree in economics dating back to the famous Stolper-Samuelson trade theorem. The United States has relatively more highly-educated workers (college degree or more) than developing countries and relatively fewer less-educated workers (less than a college degree). This means that when we open trade to China and other developing countries, we would expect to see more highly educated workers benefit and less highly educated workers lose.
We saw this story in action in the last decade in a really big way. From 2000 to 2007 we lost 20 percent of all manufacturing jobs in the United States. (This is before the Great Recession; the job loss was due to the explosion of the trade deficit in these years, not the collapse of the housing bubble.) We lost 40 percent of the jobs held by union members in manufacturing in these years.
It is important to remember that the Stolper-Samuelson prediction on non-college educated workers being losers (roughly two-thirds of the labor force) is a balanced trade story. The picture is of course worse when the U.S. runs a large trade deficit, since most of what we import is manufactured goods, a sector which employs a disproportionate number of non-college educated workers."
This theory is bolstered by a Brookings report: In "The Decline of the U.S. Labor Share," authors Michael Elsby of the University of Edinburgh, Bart Hobijn of the Federal Reserve Bank of San Francisco, and Aysegul Sahin of the Federal Reserve Bank of New York find that the decline of the labor share, which has been driven by a decline in the share of payroll compensation in national income over the last 25 years, is likely due to the offshoring of the labor-intensive component of the US supply chain.
Back in 1992 many Democrats opposed NAFTA, but Bill Clinton triangulated with Republicans to get it passed. Then Clinton signed China PNTR, granting China full access to WTO, whereupon the great sucking sound of jobs going to China began at full throttle.
It was a neat trick that Republicans played--let Democrats take the fall for the eventual unpopularity and resulting resentment for the adverse effects of 'free' trade. Surprisingly enough, the corrupt, sclerotic Team Pelosi still embraces 'free' trade, basically serving up the Rust Belt to Trump on a silver platter.
And people who should know better, think Krugman, still find little to criticize about the way 'free' trade was implemented, despite rising inequality and right-wing populism that it engendered. Back in 2000 Krugman even had the chutzpah to claim that 'free' trade would be good for labor! Such behavior tends to beg the question of whose side the Democratic leadership and Krugman and his ilk are really on hint: Wall Street really loves 'free' trade.The political economic establishment is replete with diverse but largely complementary motives. Global humanists raise the standard of living in poor countries while wealthy capitalists collect rents from the arbitrage of lower standards of living in poor countries. Establishment elites all have their price, but not all have the same price.Christopher H. said in reply to RC (Ron) Weakley... , July 23, 2019 at 07:56 AM
Yet, diverse elites hanging out together is more fun than a backyard barbeque with factory workers no matter how good the barbeque and coleslaw is. Coleslaw does not pair well with caviar, at least not real caviar, the kind made of fish roe. Cowboy and cowgirl caviar is another thing entirely, pairing well with barbeque and coleslaw as long as you have some tortilla chips too.
It is a rainy day here today and I have not had brunch yet."Global humanists raise the standard of living in poor countries "RC (Ron) Weakley said in reply to Christopher H.... , July 23, 2019 at 09:38 AM
maybe b/c it takes very little to raise up the global poor, but have you seen what happened in Greece and Puerto Rico?
These places like Mexico should have moved to first world status after the Cold War ended but are still stuck and getting worse.
I think the global situation is more of a mixed back. Countries are going authoritarian b/c of neoliberalism: Putin, Turkey, Trump, Brexit, Hungary, etc.
Immigrants and refugees are being scapegoated.Yes, of course you are correct in that.Gibbon1 -> Christopher H.... , July 27, 2019 at 12:59 AM> Immigrants and refugees are being scapegoated.JohnH -> RC (Ron) Weakley... , July 23, 2019 at 09:18 AM
I like to say about immigrants and refugees. At least the jobs they're working are here and not in China. Which means they're spending the money they earn here and not in China.'Free' trade was not advertised as being a zero sum game. It was supposed to have been an example of large benefits and small losses on both sides.RC (Ron) Weakley said in reply to JohnH... , July 23, 2019 at 09:43 AM
However, the way it was designed by those who designed it (chiefly multi-nationals), the enormous benefits got captured by a small minority, while a large majority suffered losses, at least in the United States.
Sad to see that the 'free' trade zealots still refuse to do anything constructive to mitigate the losses, or even acknowledge that there were major adverse effects and so we have Trump as a resultYes, indeed. Multinational corporations perversely redefined comparative advantage to mean global arbitrage opportunities against labor and regulatory standards. Low wages buy poison air and water while corporations just collect the rents.mulp -> RC (Ron) Weakley... , July 23, 2019 at 02:04 PM"Yes, indeed. Multinational corporations perversely redefined comparative advantage to mean global arbitrage opportunities against labor and regulatory standards. Low wages buy poison air and water while corporations just collect the rents."RC (Ron) Weakley said in reply to mulp ... , July 24, 2019 at 04:54 AM
Which corporations exactly have or are extracting high rents from pollution in China or India or Africa in ways that have not profited you personally?
The only big rent seeker related to pollution are big oil, and its been the opposition to a high carbon tax in the US that's failed to drive out pillage and plunder rents.
If Trump were true to his rhetoric, his first tariff would have been $50 a barrel on imported oil based on Saudi Arabia taking advantage of stupid Americans, getting rich selling US oil and then forcing US to spend trillions waging wars to protect Saudi rent extraction screwing Americans.
China, in contrast, has built so much capital, it's destroyed most global corporate rent seeking. China is, as a national policy, determined to bankrupt big oil, Saudi Arabia, etc.
China is "stealing" US corporate monopoly power by creating competing corporations which price at costs, ie, at zero rent.
Some argue that hiring employees of US global corporations is theft.
But that was something that corporations in California accused each other of doing in the 90s.
And something employers did as industry rose in the US, leading to company towns, and goons to prevent workers from stealing from their employer by setting themself up in business based on their unique skills and knowledge honed by working for big business.
Eg, Tesla "stealing" from Edison by going to work for Westinghouse.
US businesses invented golden handcuffs in the era defined by IBM. It was California that challenged the golden handcuff corporate establishment.
What did these Californians promise? Wealth from high rent extraction.
But China has destroyed that California rent extraction gravy train as a means of stealing from each other.[Not to belabor the obvious -]mulp -> RC (Ron) Weakley... , July 24, 2019 at 05:43 AM
Chinese Apple suppliers face toxic heavy metal water pollution charges
Foxconn denies allegations, Apple reiterates zero-tolerance stance
By Rik Myslewski 5 Aug 2013 at 18:54
Chinese environmental regulators have launched an investigation into two Apple suppliers – one being the giant iDevice assembler Foxconn – in response to allegations that the companies' factories are using nearby rivers as dumping grounds for huge amounts of toxic heavy metals.
"If you're severely exceeding emissions standards, then we will punish you," Chinese environmental regulator Ding Yudong told The Wall Street Journal, speaking of the investigations into Foxconn and UniMicron.
Both companies are based in Taiwan, are listed among Apple's suppliers, and have manufacturing plants in mainland China. The factories in question are in the industrial area of Kushan, located between Shanghai and Suzhou.
According to the WSJ, the investigations were sparked by allegations from Chinese activist and 2012 Goldman Environmental Prize winner Ma Jun, a director of China's Institute of Public & Environmental Affairs (IPE).
Four other environmental groups joined the IPE in accusing Foxconn and UniMicron of dumping heavy metals into the Huangcangjing and Hanputang rivers. Those two rivers flow into the Yangtze and Huangpu rivers, which supply Shanghai with drinking water.
Foxconn has denied the charges, telling Bloomberg that its Kushun factory follows all applicable environmental regulations. Plant manager Yang Jixian was said much the same, according to China's Xinhua News Agency. UniMicron remains mum.
Apple spokeswoman Kitty Potter told Bloomberg, "We do not tolerate environmental violations of any kind and regularly audit our suppliers to make sure they are in compliance."
The WSJ interviewed a few Kushan locals about the levels of pollution in nearby rivers. One, Zhao Pingxing, said, "We used to catch cuttlefish there, and it was so clear we could see a meter down," he said – and told the WSJ that although he occasionally fishes there these days, he doesn't eat what he catches.
Another, identified only by his surname Yao, said, "Even if my hands were dirty, I wouldn't wash them in this water."
That water, however, is second in line in China's environmental cleanup plans. Late last month, the Middle Kingdom announced that it would spend $277bn on an effort it's calling the Airborne Pollution Prevention and Control Action Plan in response, no doubt, to such events as the choking "Airpocalypse" that blanketed the Beijing area this January.
Water pollution, however, is on the Chinese government's list for cleanup efforts over the next five years, according to China Daily. Perhaps after that program begins, the regulations that Foxconn, UniMicron, and others will face will be more stringent, Zhao will be able to eat his fish, Yao will be able to wash his hands, and Potter will no longer have to issue canned "We do not tolerate environmental violations" statements.
[US firms can collect rents just by sourcing from Chinese firms that pay low wages and pollute just as well as they can exploit their hands-on partnerships. Rents laundered at arms length are no less destructive to either exploited workers or displaced workers. Most partnerships between Chinese and US firms places the direct exploitation in Chinese hands while most of the rents go to US firms.
I got the money, honey, if you got the crime.]
Rising returns to US capital demonstrate that the rentier is far from dead. ]I'm reading aboout US coal companies declaring bankruptcy to shed their mine reclamation costs, while already having shed hundreds of billions in coal pollution from mining techniques since circa 1980, plus coal ash pollution, also largely since the 80s.RC (Ron) Weakley said in reply to mulp ... , July 24, 2019 at 10:05 AM
The US has burned coal for two centuries, but swag, 40% of the coal burned in the US has been since the passaage of tthe clean water and clean air acts.
China has acted several times faster, and punished pollution violations much harsher, than the US, England, ....Understood, but when I refer to pollution then I am not just referring to CO2 or even primarily CO2 or even CO2 at all. Anthropogenic climate change is a much different beast that biological and chemical pollutants that poison the water and air. We are all dying slowly anyway and at least we will not be lying cold in the ground.kurt -> RC (Ron) Weakley... , July 25, 2019 at 09:54 AM
Don't get me wrong though. I have long believed that climate change poses a serious threat and possibly even an existential risk to much of humanity. OTOH, semantics prevents me from lumping a dangerous excess of otherwise beneficial and necessary atmospheric compounds together with pathogens. We breath out CO2 and plants make sugar from it using photosynthesis. It is an essential part of the nature of living things.I agree on all of this - however, I don't think that the way to solve this is by destroying free trade. Instead, fix the distributional and environmental issues and redistribute the low marginal utility $.RC (Ron) Weakley said in reply to kurt... , July 27, 2019 at 05:08 AMYou are most likely correct to the extent that anything at all will be done to correct for the use of trade as a tool of financial arbitrage in global labor and pollution markets. OTOH, in some far distant time that may not be as far off as we would like to think, the economy of localization of production will reassert itself against greatly rising transportation costs. Of course, that will not happen all at once and it will come about in move to optimize transportation of goods to market and resources to production that will be accompanied by much substitution in production and consumption.Mr. Bill -> RC (Ron) Weakley... , July 31, 2019 at 11:46 PM
However, the world would have been better off if developed nations would have shared their capital assets with developing nations to the ends of optimizing transportation and expanding product development around the world from the get go. We once had the opportunity to make a better world, but now we are faced only with the opportunity to survive the world that we made instead - or not.That is what neo-liberal economics has always been about. Labor arbitrage.RC (Ron) Weakley said in reply to Mr. Bill... , August 01, 2019 at 05:27 AM
It is interesting that the conglomerate media frames it as higher prices for American consumers.
Unemployed people prefer cheaper goods from Asia.Yes sir, exactly.mulp -> JohnH... , July 23, 2019 at 01:33 PM"Free' trade was not advertised as being a zero sum game. It was supposed to have been an example of large benefits and small losses on both sides."mulp -> RC (Ron) Weakley... , July 23, 2019 at 01:06 PM
You are clearly very right wing in demanding a billion dollars in benefits at a dollar in costs because you reject zero sum as a hard rule in all trade, whether in a store, a community, within a nation, and between nations.
West Virginia has suffered, not from global trade, but because of local trade. Global trade has slowed its economic decline because it can produce met coal which costs customers ten times steam coal.
US policies that are supoosedly to cut costs, increased "costs" to WV workers, by killing their jobs, which is a lower cost requiring lower benefits, eg less income to keep paying higher living costs. Cutting living costs is not a good thing when its forced on you by lower incomes.
If the US economic policy was to hike costs, say hiking taxes, fees, tolls, fares to pay to build better transportation capital, then demand for steel in the US would be so high that WV would be mining several times as much met coal, which costs consumers ten times as much as steam coal.
"However, the way it was designed by those who designed it (chiefly multi-nationals), the enormous benefits got captured by a small minority, while a large majority suffered losses, at least in the United States."
Strange you consider at least 250 million Chinese workers to be a minority relative to a much smaller number of American workers who are worse off from the left and right worship of cutting living costs.
Zero sum is axiomatic, so lower living costs means lower benefits, especially lower wages. High wages are a costly benefit that increase living costs."Global humanists raise the standard of living in poor countries while wealthy capitalists collect rents from the arbitrage of lower standards of living in poor countries. Establishment elites all have their price, but not all have the same price."
But as a "global humanist", the goal is to raise the living costs of poor nations up to the living costs of say the US in 1950 in two generations instead of the maybe five generations it took the US to get to 1950 living costs.
The only way to increase living costs is some agency which pays more workers more money to work more. In the US, the agents were the railroad building from 1840 to 1990, the good roads building fromm1920 to 1970, the lifting of education standards from 8th grade circa 1920 to 14th grade by 1970.
What confuses conservatives is the concept of price and cost. A lower price increases costs. The current cost of going to the moon is zero because the price to send the first person to the moon since 1972 is at least $10 billion, and a realistic business plan sets the cost at $25-50 billion. A price of $10 million to go to the moon and return a year later will result in massive increased costs to humans who pay the lower price of living on the moon for an extended time.
Global trade increases living costs for poor people in order to improve their lives. But increasing their living standard requires paying them to work produce more of somethings than they can possibly consume, which is then sold to nations capable of producing more high cost and price items than the global economy can afford.
For the US to be able to produce 10 billion bushels of grain when the global market is only able to pay for 8 billion is a big problem. The pre-globalization solution was to kill jobs in poor naations by the US government dumping grain on poor nations at a price of zero.
Would you advocate isolationism that creates a great depression, a la the 20s and 30s US economic policies. No exports, no trade, thus forcing costs down as prices are forced down with higher and higher unemployment?
Aug 02, 2019 | economistsview.typepad.com
Joe , July 24, 2019 at 08:18 AMAcknowledging and pricing macroeconomic uncertainties - Hansen and Sargent
False pretences of knowledge about complicated economic situations have become all too common in public policy debates. This column argues that policymakers should take into account what they don't know in their decision making. It describes a tractable approach for acknowledging, characterising, and responding to different forms of uncertainty, by using theories and statistical methods available at any particular moment.
Yes, starting about 10,000 years ago.
After our current MMT, we will get the same false pretence, we will have a bunch of AOC geeks on this blog explaining things have been fixed,'We won't do it again' to quote Ben, among the many thousands of false pretencers. We will hear from the 'Uncle can fix it later' crowd. "This time is different' chants another tribe. Someone will put up a blog, and we will recite talking points absent any evidence.
The delusionals and their preachers do not go away, and neither do their followers. It is like a religion, we know it is BS, but it keeps our hysteria in check.
Jul 31, 2019 | economistsview.typepad.com
likbez -> EMichael... , July 31, 2019 at 02:51 PMEMichael,Joe -> Paine ... , July 21, 2019 at 05:33 PM
Neoliberals/neocons like you are so detached from reality that it hurt. You better stop posting as you understand nothing and can learn absolutely nothing. You views are essentially frozen for the last three years and you definitely are unable to evolve above the level of a typical neoliberal propaganda.
Neoliberal ideology is discredited since 2008 and neoliberal elite lost the control of the electorate via usual "divide and conquer" identity politics in 2016; the neoliberal economics entered the state of "secular stagnation" (according to Summers) and chances that it can escape this state are non-existent.
Why it is so difficult to understand the USA is facing the crisis of neoliberalism much like the USSR faced the crisis of Bolshevism since 1960th.
And that Trump election was direct result of this crisis and the betrayal of working and lower middle class by "Clintonized" Dems, which become essentially Republican light (or "party of soft neoliberals") as well as the second war party (and being a war party means that you do not need to win the elections, MIC rules the country in any case). That's why Russiagate was launched to patch the cracks in the neoliberal façade and as a smoke screen for neoliberal Dems political fiasco.
And Paine is right: after Bill Clinton sold Democratic Party to Wall Street it did not care one bit about the workers. Clinton's idea was that workers have nowhere to go. He was right for 20 years or so but then Dems were trumped ;-)
IMHO the best way for Neoliberal Dems in 2020 is to commit suicide by selecting semi-senile neoliberal Biden (who, essentially, is "Hillary light", especially in foreign policy ). This way the party can get rid of Clinton mafia.
But I think Warren has a chance in this cycle despite all her blunders.
As a side note, I still hope that war criminal Bill Clinton will be tarred and feathered and then lynched with Epstein. And please note that unlike Epstein, Bill can't claim asylum in Israel.
P.S. Please do not reply to this post. You can't say anything useful or constructive on the topic.You have no real evidence for that fact, just supposition from some set of assumptions. Yet the articles posted continue to identify limits to what Uncle can do. like pay attention to demographics on entitlements, Malthus lives on,just one of the articles finding evidence of limits, compared to your invention.kurt -> Paine ... , July 22, 2019 at 03:36 PMYou keep missing the fact that the white wage class has repeatedly voted to destroy unions, to have state level republican control and to vote in every model legislation that ALEC and Mackinaw Center hand them. Also, under normal (ie: when Rs didn't use procedure to prevent everything) circumstance, Ds really haven't had much power nationally since Reagan. But do go on.Plp -> kurt... , July 22, 2019 at 05:49 PMPerfectly missed the pointkurt -> ilsm... , July 16, 2019 at 10:09 AM
The Dems failed to provide a progressive
Wage class benefiting alternative
To hate and self destructive spite
For 40 years b4 Trump won the rust bowl derbyYou object to being called a racist, but you support racists and racist ideas. Sorry - you can't have it both ways. You are a racist.RC (Ron) Weakley said in reply to kurt... , July 16, 2019 at 10:44 AMRacism is either a matter of degrees or, if you prefer, we are all racists. That is exactly what that joke line "I don't see color" means. When black people are racist and they get special treatment for being racist then that is about the most racist thing that I see around today that is still widespread.kurt -> RC (Ron) Weakley... , July 16, 2019 at 11:54 AM
The fraction factions are disgusting and soft racism is pervasive. But what many liberals do not get is that just calling people out (as they say) as racist really leads to more racism rather than less. If you want peer pressure to work for you, then first you must work to establish yourself as peer.
I understand that you are not the only graduate of the idiot school of childish psychology, but you are a consistent advocate of the practices as is your little nemesis ilsm.I really strongly disagree with this. I try really hard to both notice and to correct any engaging in implicit bias. I also reject the idea that a person can be measured by the hue of their skin, where they worship (or if they do) and their sex or sexuality. My midwestern sensibilities tell me that what really matters is how hard you try and how decent of a human being you are. I don't see how you can 1. think that the Trump/Russia thing is a hoax after reading the Mueller report, 2. think that Trump belongs in office and is not doing serious irreparable damage to the United States and still be a good person. I also don't see how you can be anti-racist and support Trump. In fact, I think this is axiomatic.ilsm -> kurt... , July 16, 2019 at 12:33 PMhow does one qualify to be "anti racist"?kurt -> ilsm... , July 16, 2019 at 12:47 PM
Other than finding outrage in trump and folks who do not buy the latest DNC screed to be outraged about?
1. you need to convince not quote the Mueller hatchet job, w/o footnote!
What Mueller said: there is no collusion with Russia, but Trump pushed back too hard on the deep state attempted coup!
2. See 1.
I am for seeing Durham get to holes in the faux evidence and who dug them.
Is that racist?I have provided the footnote about 50x. The report plainly states that there was coordination between known actors of the Russian government and Trump campaign officials, and that they could not get documentary evidence BECAUSE OBSTRUCTION - which, btw where the headline charges against both Nixon and Clinton. Also - Mueller SPECIFICALLY said that there is no legal standard for collusion and that there was likely conspiracy, but obstruction.JohnH -> kurt... , July 17, 2019 at 11:29 AM
Qualifying to be anti-racist - against racism, racist policy, structural racism overtly.
Faux evidence? WTF are you talking about.
You support a racist. You cannot support a racist implementing racist policy measure in an extra legal way without yourself tacitly agreeing that said racism is just fine. Again - this is axiomatic and I am sorry that shining a light on it hurts your feelings, but you can change. I invite you to.Such inflammatory charges!!! Meanwhile Democrats have no urgency about investigating this. Why the dillydallying? Because that's what Democrats are genetically programmed to do? Or because there is no there there?RC (Ron) Weakley said in reply to kurt... , July 16, 2019 at 12:46 PM
There is a increasing body of evidence to suggest that Trump-Putin was a trumped up psy-ops campaign designed to demonize Russia (and Trump.) Some if Mueller's allegations rest on very shaky grounds.I think that personal criticisms of an ant does not amount to a hill of beans, but rather reduces one to being an ant-man. I don't care for all those holes in my yard and I certainly do not want to see a long file of ants headed towards my pantry, but I have no personal accusations that are worth leveling against ants. I do not even squish a bug that stays out of my house. I let the ant lions that surround my home take care of most of the ants and when that fails and some start heading inside my home then I spray Raid in their path.kurt -> RC (Ron) Weakley... , July 16, 2019 at 01:08 PM
I advise everyone to always make friends with everyone that they do not want to kill. A key part of that is to know and observe one's own boundaries when dealing with others. One can criticize an idea or an action without the implicit arrogance required to pass judgement on others, which explicitly leads to most people not giving a damn what one has to say anyway. I prefer to not back anyone into a corner unless I am holding a gun.Yeah - okay. But when someone lies, dissembles, makes stuff up out of whole cloth all in support of a person who has demonstrated repeatedly that they think that white is right - they are racist. That's fine.RC (Ron) Weakley said in reply to kurt... , July 16, 2019 at 02:31 PM
When ilsm has the courage and morality to call Trump what he is, then I will give him quarter. Until then, he is as evil as they come in my book.Evil comes in far more significant sizes than any anonymous blog commenter on an Internet economics board frequented by a small group of nerds and geeks. If you believe that ilsm is evil then you are lucky enough to have never encountered any real evil.
It does not take any courage at all to call Donald Trump a race baiting big stupid orange buffoon. It also accomplishes nothing to blame the Russians for his election. Well that does accomplish something. It makes the Democratic Party look puny, weak, and disconnected from the lives of the majority of US citizens. I won't press too hard on that part though because it was already established fact long before Donald Trump entered politics.
Jul 31, 2019 | www.moonofalabama.org
donkeytale , Jul 30 2019 12:10 utc | 80Stages of capitalist development explain more than white papers and propaganda can conceal. The relevant comparative period is 1990 - present (China/Russia) versus 1950-1980 (US/West).Ex-communist countries like Russia and China have experienced the same decline in the share of public property, but starting from a much higher level of public wealth. The share of net public wealth was as large as 70–80 percent in both countries in 1980, and fell to 20 percent (Russia) and 30–35 percent (China) in 2015.
The Chinese share is higher but not incomparable to that observed in Western high-income countries during the "mixed economy" period (1950–1980).
In other words, China and Russia have ceased to be communist in that public ownership is no longer the dominant form of property. However, these countries still have much more significant public wealth than Western high-income economies, due largely to lower public debts and greater public assets.
Jul 31, 2019 | www.strategic-culture.org
When Rome was in its ascendancy and at its height, the leaders of Rome were all native Romans or at least native Italians. If they were born in other parts of the Empire, they were of Roman culture and had Roman names and Roman values. They had a stake in their civilization.
But as time went on, all of this started changing.
By the time the barbarians invaded the Empire wholesale -- starting with the battle of Adrianople in 378 AD -- the handwriting was already on the wall. Within 30 years, the barbarians controlled the entire Empire.
The old political structure had completely collapsed. Native Romans were leaving the Empire, going to barbarian lands, to avoid onerous taxation. The currency was worthless. The economy was in a shambles. The military structure had completely collapsed. None of the soldiers were Italians; they were all barbarians hired as mercenaries. Likewise, here in the US, few Americans in the diminishing middle class want to join the military. The city of Rome itself was sacked in 410 AD and it never really recovered.
International Man :
Economically, the US government continues to spend ever-increasing amounts of money. In 2018 alone, the federal deficit was $779 billion -- a $113 billion increase from the year before. Politicians on both sides of the aisle are falling over themselves to offer new government freebies that could pay for college, medical care, and the list goes on.
How does this play into the theme of US decadence?
Doug Casey : Well, whether you're an individual or a family or a country, when you live above your means, you're almost by that very fact decadent. You're not planning for the future.
But the US government's debt and reported deficits represent only current cash outlays, not obligations in the form of future spending. If the deficits were represented with accrual accounting -- which is what businesses have to do -- the annual deficits would probably be more like $3 trillion.
Not to mention that interest rates are artificially suppressed to about 2% in the US. At more normal levels of, say, 6%, the annual deficit would be about $800 billion higher. So the financial situation is actually much, much worse than it seems.
On top of all this is the fact that these deficits come during a time of supposed recovery. But the "recovery" has been ramped up by creating trillions of new dollars and allowing people to borrow at effectively negative interest rates, certainly after inflation. This is all very decadent.
Eat, drink, and be merry, for tomorrow we die. That's not the attitude of a rising civilization.
The opposite of "decadent" is to be constructive, disciplined, forward-thinking, and self-respecting. You produce more than you consume and save the difference.
That's exactly the opposite of what Americans are doing today.
We're completely decadent.
Small comfort that the Europeans are even worse off than we are.
On an individual level, Americans are living beyond their means. Many Americans have less than $1,000 in savings.
What does this say about a society?
Doug Casey: It augurs very poorly.
The average American is one paycheck from not being able to pay his rent. When the distortions that have been cranked into the economy over just the last 10 years unwind and the economy as a whole goes downhill again, there are going to be millions of people who can't pay their rent. Many millions more are going join the 42 million Americans now living on food stamps.
The social repercussions of this are predictable.
The population will get angry; many will go into the streets and riot. They're going to vote overwhelmingly for some politician who says that he -- or quite possibly she -- can cure all their problems by giving them free stuff stolen from rich people.
In a way it's understandable, because the fact of the matter is the rich have indeed been getting richer at an accelerating rate.
Because they're the ones that get to stand next to the firehose of money that's coming out of Washington. They get it first; they get most of it. It's another sign of a society in decline: the dominance of cronies. That creates a lot of class antagonism.
It's going to explode and be really ugly. Perhaps one thing keeping a lid on the situation is the huge number of Americans on psychiatric drugs: Zoloft, Prozac, and a hundred others. Perhaps millions of others don't care as long as their internet connection enables them to play video games.
International Man :
Aside from the financial aspect of decadence, what is happening culturally and intellectually in the United States? For example, many Americans are rejecting biological facts in favor of the politically correct fad of the day. Is this a sign of decline?
Doug Casey : The PC types say there are supposed to be 30 or 40 or 50 different genders -- it's a fluid number. It shows that wide swathes of the country no longer have a grip on actual physical, scientific reality. That's more than a sign of decline; it's a sign of mass psychosis.
There's no question that some males are wired to act like females and some females are wired to act like males. It's certainly a psychological aberration but probably has some basis in biology.
The problem is when these people politicize their psychological peculiarities, try to turn it into law, and force the rest of the society to grant them specially protected status.
Thousands of people every year go to doctors to have themselves mutilated so that they can become something else. Today they can often get the government or insurers to pay for it.
If you want to self-mutilate, that's fine; that's your business even if it's insane. To make other people pay for it is criminal. But it's now accepted as normal by most of society.
The acceptance of politically correct values -- "diversity," "inclusiveness" -- trigger warnings, safe spaces, gender fluidity, multiculturalism, and a whole suite of similar things that show how degraded society has become. Adversaries of Western civilization like the Mohammedan world and the Chinese justifiably see it as weak, even contemptible.
As with Rome, collapse really comes from internal rot.
Look at who people are voting for. It's not that Americans elected Obama once -- a mob can be swayed easily enough into making a mistake -- but they reelected him. It's not that New Yorkers elected Bill de Blasio once, but they reelected him by a landslide. All of the Democratic candidates out there are saying things that are actually clinically insane and are being applauded.
International Man :
In fact, in the recent Democratic debate, candidate Julián Castro even mentioned giving government-funded abortions to transgender women -- biological men. It received one of the loudest bouts of applause from the audience.
That's not to mention that two other candidates spoke in broken Spanish when responding to the moderator's questions.
Doug Casey: As you said, it got a lot of applause.
US presidential candidates speaking in Spanish would be very much like an ancient Roman addressing the Forum in Gothic, not Latin. It's all over for a culture when it starts using the language of its conqueror. In a restaurant here in Aspen, the owners have a sign in Spanish that refers to the progress of the Reconquista -- the recapture of the American Southwest from the Anglos. Perhaps someone will speak Arabic in the next debates.
I hate to sound defeatist, but it's all over for what was once known as American civilization. The celebrity of AOC is indicative. How else could a 29-year-old Puerto Rican waitress, poorly educated and not very bright, set the political tone for the whole country?
International Man :
Is America's late-stage decadence a product of its political and economic decline or vice versa?
Doug Casey : The decadence we see all around us is arising from every source. Cultural, economic, and political. Cultural decline is the most basic area. Massive immigration of people with different cultures, languages, and religions guarantee it. Especially if they're coming because of free benefits. Many actually despise traditional American culture, as well as holding the current culture in contempt.
Their views are then reflected in a corruption of the politics. We see that with the apparent acceptance of the Squad -- although I prefer to call them the "Gang of Four." Politics engenders economic distortions. Part of the problem is that politics completely dominates the economy today.
For Trumpers to think that building a wall is going to change things is naïve. A wall will be about as effective as a kid's sandcastle on the beach to hold back the waves.
The barbarians are already within the gates.
Jul 30, 2019 | jessescrossroadscafe.blogspot.com
"Empires in decline tend to behave badly. Indeed, whether British, French or Russian, the twilight years of imperialism often brought brutal repression of subjects abroad, the suppression of civil liberties at home and general varieties of brutality toward foreigners, be they refugees or migrants.
Aggressive wars abroad pollute the domestic political discourse and breed hypernationalism, racism and xenophobia. The 18 or so years of war following the 9/11 attacks have seen this ostensible republic sink to new lows of behavior.
Aggressive wars of choice have ushered in rampant torture, atrocities in Iraq's Abu Ghraib prison, indefinite detention at Guantanamo Bay, extraordinary rendition, drone assassinations, warrantless wiretapping, mass surveillance of the citizenry...
It's all connected. The empire -- all empires -- eventually come home."
Maj. Danny Sjursen, An American Tragedy: Empire at Home and Abroad
Jul 30, 2019 | jessescrossroadscafe.blogspot.com
"As I turn 75, there's no simpler way to put it than this: I'm an old man on a new planet -- and, in case it isn't instantly obvious, that's not good news on either score...
"My name is Ozymandias, king of kings: Look on my works, ye mighty, and despair!"
And I find myself looking at a world that, had you described it to me in the worst moments of the Vietnam War years when I was regularly in the streets protesting, I would never have believed possible. I probably would have thought you stark raving mad. Here I am in an America not just with all the weirdness of Donald Trump, but with a media that feeds on his every bizarre word, tweet, and act as if nothing else were happening on the face of the Earth. If only...
If you had told me that, in the next century, we would be fighting unending wars from Afghanistan to Somalia and beyond I would have been shocked. If you had added that, though even veterans of those wars largely believe they shouldn't have been fought, just about no one would be out in the streets protesting, I would have thought you were nuts."
Tom Engelhardt, TomDispatch
"The Babylonian starlight brought
A fabulous, formless darkness in;
Odour of blood when Christ was slain
Made all platonic tolerance vain,
And vain all Doric discipline."
William Butler Yeats
"The reason is partly because of a glitch in human cognition known as the just world hypothesis or just world fallacy, which causes us to assume that if bad things are happening to someone, it's because that person deserves it. Blaming the victim is more psychologically comfortable than seeing that we live in an unjust world where we could very easily become victim ourselves someday, and we select for that comfort over rational analysis.
Like other cognitive biases, this one fundamentally boils down to our annoying psychological tendency to select for cognitive ease over cognitive discomfort. It feels more psychologically comfortable to interpret new information in a way that confirms our preexisting opinions, so we get confirmation bias .
It feels psychologically comfortable to assume something is true after hearing it repeated many times, so we get the illusory truth effect . It feels more psychologically comfortable to believe we live in a fair world where people get what they deserve than to believe we're in a chaotic world where many of the most materially prosperous people are also the most depraved and sociopathic, and that we could be next in line to be victimized by them, so we get the just world fallacy."
Caitlin Johnstone, The Just World Fallacy: Why People Bash Assange and Defend Power
" The so-called paradox of freedom is the argument that freedom in the sense of absence of any constraining control must lead to very great restraint, since it makes the bully free to enslave the meek. The idea is, in a slightly different form, and with very different tendency, clearly expressed in Plato.
Less well known is the paradox of tolerance: unlimited tolerance must lead to the disappearance of tolerance. If we extend unlimited tolerance even to those who are intolerant, if we are not prepared to defend a tolerant society against the onslaught of the intolerant, then the tolerant will be destroyed, and tolerance with them ."
"And some of us who have already begun to break the silence of the night have found that the calling to speak is often a vocation of agony, but we must speak. We must speak with all the humility that is appropriate to our limited vision, but we must speak."
Martin Luther King, A Time to Break the Silence , April 1967
"What does it profit a man, to gain the whole world, but lose his soul?"
Jul 03, 2019 | turcopolier.typepad.com
A while back we were discussing the merits of a liberal arts education and the sad state of our current education system. As part of that discussion, I looked at the current curriculum of my old prep school to see if it changed much from when I was there. To my surprise and joy, it changed very little. Students are still required to take four years of theology good Jesuit theology. I was struck by the entry for the current theology department at Fairfield Prep and now present it below.
In light of the current discussion about the rise of the new bolsheviki in the Democratic Party, I thought I'd share my thoughts on the Ignatian approach to Roman Catholicism. I'm pretty sure many of you will consider the black robes to be quite red. I, on the other hand, find the teachings and example of Saint Ignatius of Loyola to be far more profound and worthy of emulation than anything Marx or Lenin ever dreamed of.
-- -- -- -- -- --
What is theology? Fundamentally, it's about conversation.
The Greek word Theós (God) combined with logos (word, or reason) describes what happens in theology classes at Fairfield Prep. Talking about God, discovering God in the person of Jesus Christ, asking questions, having discussions and debates, and exploring the truths of other world religions are some of the many things that happen in theology. Through exegetical analysis of Scripture, learning the philosophies of the Saints (in particular, St. Ignatius of Loyola), contemplation, and reflection, theology students at Fairfield Prep are drawn to a more intimate experience of the Divine in their own lives.
In the classroom, students are exposed to the teachings of Christ regarding the Gospel imperative – the care of the poor. Theology students are inspired to work for equality and social justice in their local and global communities.
In the spirit of Christ, through Ignatian practices, students are encouraged to grow spiritually and religiously by orienting themselves towards others. Practically speaking, students are called to "Find God in All Things." By recognizing the presence of the Divine within others and the universe we live in, students may be inspired to develop a deeper appreciation and love for Creation – in particular, care for our environment.
Morality, ethics, philosophy, history, science – they are all present within discussions of theology. Regardless of faith background (or lack thereof) all students are encouraged to express their beliefs and share their life experiences in their own ways. In theology, we are constantly working towards discovering Truth in our lives. Through science, history, literature, Scripture, and the Sacraments, we understand that God can be found in all things and in all ways here at Fairfield Prep. Join us as we continue the discussions, the questions, the reflections, and the actions that will make this world a more loving place for all.
- Mr. Corey J. Milazzo
Chair of the Theology Department
-- -- -- -- -- --
It's still there, the call to find God in all things and to be a man for others. I graduated a few years before Father Pedro Arrupe presented his dissertation and made his presentation which became known as his "Men for Others" thesis. But his ideas already ran through the halls and faculty of Fairfield Prep by the end of the 60s. Community service was an integral part of the curriculum back then as were frequent retreats based on the Ignatian spiritual exercises. They still are. The Jesuits molded us into men for others, social justice warriors, but with a keen sense of self-examination (the examen). When we graduated in the rose garden of Bellarmine Hall under a beautiful June sun, we were charged with the familiar Jesuit call "ite inflammate omnia" (go forth and set the world on fire).
That phrase in itself is provocative. It goes back to Saint Ignatius of Loyola himself. It may go back much further, back to Saint Catherine of Siena. One of her most repeated quotes is "Be who God meant you to be and you will set the world on fire." Setting the world on fire must have a different meaning back then. It sounds down right revolutionary these days.
In more recent times, Jesuits participated in the development of liberation theology, a blending of the Church's professed preference for the poor and Marxism that is unsettling to many both in and outside the Church. This expression of strident social justice was never supported by the Vatican, especially when liberation theologists aligned themselves with armed Marxist revolutions. Even Pope Francis was not a fan although as Father Bergoglio he said,Pope Francis seeks reconciliation with rather than expulsion of the liberation theologists. This doesn't surprise me considering the Jesuits' firmly held faith in the primacy of conscience, the belief that an informed conscience is the ultimate and final authority on what is morally permissible, and it is the obligation of the individual to follow their conscience even if it contradicts or acts against Church teaching. I believe that, but I also believe the liberation theologists could benefit from a more rigorous examen to reach a higher sense of discernment and a truly informed conscience.
"The option for the poor comes from the first centuries of Christianity. It's the Gospel itself. If you were to read one of the sermons of the first fathers of the Church, from the second or third centuries, about how you should treat the poor, you'd say it was Maoist or Trotskyist. The Church has always had the honor of this preferential option for the poor."
I think the 1986 film "The Mission" captured some of these ideas and struggles very well with the interplay of Father Gabriel, Roderigo Mendoza and both the secular and religious authorities of that time. As a product of a Jesuit and Special Forces education, this film resonated with me.
DOL - AMDG
Jul 06, 2019 | www.nakedcapitalism.com
US President Donald Trump's ruthless use of the centrality of his country's financial system and the dollar to force economic partners to abide by his unilateral sanctions on Iran has forced the world to recognise the political price of asymmetric economic interdependence.
In response, China (and perhaps Europe) will fight to establish their own networks and secure control of their nodes. Again, multilateralism could be the victim of this battle.
A new world is emerging, in which it will be much harder to separate economics from geopolitics. It's not the world according to Myrdal, Frank, and Perroux, and it's not Tom Friedman's flat world, either. It's the world according to Game of Thrones .
Synoia , July 5, 2019 at 11:14 am
A new world is emerging, in which it will be much harder to separate economics from geopolitics.
Really? Why was Economics was originally named “Political Economy?”
vlade , July 5, 2019 at 1:36 pm
Politics is a continuation of economy by other means (well, you can write it the other way around too, TBH).
Summer , July 5, 2019 at 9:45 pm
It made me do a face palm. Somebody thought they had separated economics from geopolitics or power…or at least they wanted people to believe that and the jig is up.
fdr-fan , July 5, 2019 at 11:40 am
This paragraph is thought-provoking:
“One reason for this is that in an increasingly digitalised economy, where a growing part of services are provided at zero marginal cost, value creation and value appropriation concentrate in the innovation centers and where intangible investments are made. This leaves less and less for the production facilities where tangible goods are made.”
It depends on what you mean by value.
If value is dollars in someone’s Cayman Islands tax-free account, then value is concentrated in NYC and SF.
But if we follow Natural Law (Marx or Mohammed) and define value as labor, then this is exactly wrong. A Natural Law economy tries to maximize paid and useful work, because people are made to be useful.
The digital world steadily eliminates useful work, and steadily crams down the wages for the little work that remains. Real value is avalanching toward zero, while Cayman value is zooming to infinity.
Carolinian , July 5, 2019 at 12:35 pm
He’s talking more about the whims of the stock market and of our intellectual property laws. For example the marginal cost for Microsoft to issue another copy of “Windows” is zero. Even their revised iterations of the OS were largely a rehash of the previous software. Selling this at high prices worked out well for a long time but now the software can practically be had for free because competitors like Linux and Android are themselves free. So digital services with their low marginal cost depend on a shaky government edifice (patent enforcement, lack of antitrust) to prop up their value. Making real stuff still requires real labor and even many proposed robot jobs–driving cars, drone deliveries, automated factories and warehouses–are looking dubious. Dean Baker has said that the actual investment in automation during the last decades has slowed–perhaps because expensive and complicated robots may have trouble competing with clever if poorly paid humans. And poorly paid is the current reality due to population increases and political trends and perhaps, yes, automation.
And even if the masters of the universe could eliminate labor they would then have nobody to buy their products. The super yacht market is rather small.
eg , July 6, 2019 at 5:39 am
pour encourager les autres …
a different chris , July 5, 2019 at 12:14 pm
>the distribution of gains from openness and participation in the global economy is increasingly skewed. …. True, protectionism remains a dangerous lunacy.
Well “openness and participation” is looking like lunacy to the Deplorables for exactly the reason given, so what is actually on offer here?
Lee , July 5, 2019 at 12:37 pm
With useful physical labor being off-shored, first world citizens should all be made shareholders in the new scheme. We shall all then become dividend collecting layabouts buying stuff made by people we do not know, see, or care about. If they object we simply have the military mount a punitive expedition until they get whipped back into shape. Sort of like now but with a somewhat larger, more inclusive shareholder base. It will be wonderful!
CenterOfGravity , July 5, 2019 at 1:58 pm
Are you sayin’ the lefty Social Wealth Fund concept is really just another way of replicating the same old bougie program of domination and suppression?
Check out Matt Bruenig’s concept below. The likelihood that endlessly pursuing wealthy tax dodgers will be a fruitless and lost effort feels like a particularly persuasive argument for a SWF: https://www.peoplespolicyproject.org/projects/social-wealth-fund/
Lee , July 5, 2019 at 2:26 pm
I’m saying that it can be and historically, and that there are and have been multi-national systems of super exploitation of peripheral, primarily resource exporting populations, relative to a more broadly distributed prosperity for “higher” skilled populations of the center. This has been a common perspective within anti-imperialist movements.
The argument is not without merit. Is this a “contradiction among the people” where various sectors of a larger labor movement can renegotiate terms, or is it some more intransigent, deeply antagonistic relationship is a crucial question. The exportation of manufacturing to the periphery is disrupting the political status-quo as represented by the center’s centrism, political sentiments are breaking away to the left and right and where they’ll land nobody knows.
Ignacio , July 5, 2019 at 12:16 pm
Do not forget mentioning how the tax system has been gamed to increase rent extraction and inequality.
samhill , July 5, 2019 at 12:32 pm
Why is Iran such a high priority for so many US elites?
I was just reading this John Helmer below, like Pepe Escobar I’m not sure who’s buttering his bread but it’s all food for thought and fresh cooked blinis are tastier than the Twinkies from the western msm, and this thought came to mind: Iran is the perfect test ground for the US to determine Russian weapons and tactical capabilities in a major war context in 2019. That alone might make it worth it to the Pentagon, why they seem so enthusiastic to take the empire of chaos to unforseen heights (depts?). Somewhat like the Spanish Civil War was a testing ground for the weapons of WW2.
Synoia , July 5, 2019 at 12:56 pm
1. Because it has a lot of non US controlled Oil.
2. Because it is Central on the eastern end of the silk road.
3. Because it does not kiss the US Ring bearers hand at every opportunity, and the US is determined to make it an example not to be followed.
John k , July 5, 2019 at 1:27 pm
But consider Saudi us relations… who is kissing who’s ring?
Or consider Israeli us relations… ditto.
We’re a thuggish whore whose favors are easily bought; bring dollars or votes. Or kiss the ring.
Susan the other` , July 5, 2019 at 1:51 pm
An environmental insight here. The world stands devastated. It has reached its carrying capacity for thoughtless humans. From here on in we have to take the consequences of our actions into account. So when it is said, as above, that the dollar exchange rate is more important than the other bilateral exchange rates, I think that is no longer the reality. There is only a small amount of global economic synergy that operates without subsidy. The vast majority is subsidized. And the dollar is just one currency. And, unfortunately, the United States does not control the sun and the wind (well we’ve got Trump), or the ice and snow. Let alone the oceans. The big question going forward is, Can the US maintain its artificial economy? Based on what?
Old Jake , July 5, 2019 at 2:51 pm
That is a factor that seems ignored by the philosophers who are the subjects of the headline posting. It is a great oversight, a shoe which has been released and is now impacting the floor. “The best laid schemes o’ mice an’ men”
Brian Westva , July 5, 2019 at 6:13 pm
Unfortunately our economy is based on the military industrial surveillance complex.
Sound of the Suburbs , July 6, 2019 at 2:53 pm
A multi-polar world became a uni-polar world with the fall of the Berlin Wall and Francis Fukuyama said it was the end of history.
The Americans had other ideas and set about creating another rival as fast as they possibly could, China.
China went from almost nothing to become a global super power.
The Americans have realised they have messed up big time and China will soon take over the US as the world’s largest economy.
Beijing has taken over support for the Washington consensus as they have thirty years experience telling them how well it works for them.
The Washington consensus is now known as the Beijing consensus.
Jul 27, 2019 | failedevolution.blogspot.com
Donald Trump's election was considered the beginning of a dark era for the entire planet, but could it possibly be the outcome of a well-thought-out plan set in motion decades ago? Heartbreaking stories of American citizens who feel abandoned by the US federal government are intertwined with one-on-one interviews with journalists, philosophers and political scientists. An investigative, powerful documentary that attempts to detect how corporations gradually took over politics, undermining people's will.
Jul 25, 2019 | failedevolution.blogspot.com
David Harvey speaks with Greg Wilpert and describes how neoliberalism neutralized the Left in the early 70s and why now there is a peculiar alliance between neoliberalism and right-wing authoritarianism.
As Harvey points out:
There's a curious alliance occurring between right-wing authoritarianism and neoliberalism, which is very very troubling.
When the neoliberal ethic was first being proposed, it was very much being proposed to the generation of 68 and saying to that generation, 'Look, you want individual liberty and freedom. OK, we'll give it to you in this neoliberal form, which is a very political, economic form, and you have to forget other issues, like social justice and the like.' So, it seeped its way into the discourse of much of the Left and this creates a sort of tolerance for some neoliberal practices.
Neoliberalism has a very clever way of turning things around and blaming the victim. And we saw that in the foreclosures of the housing and all this kind of stuff. Many people who were foreclosed upon, didn't blame the system. What they blamed was themselves.
When Clinton came in promising all kinds of benefits and gave us all these neoliberal reforms, at that point, people kind of said 'you know, this is not really working for me, and what's more, there's something going on here which is not right.'
The first revolt against the neoliberal order was Seattle, which was the anti-globalization movement and then all of the picketing of the IMF and G20's meetings. At that point, the ruling class has started to say 'well this could get out of hand, we need a government structure that's gonna sit on these people and do it really, really hard.'
So, when Occupy Wall Street came along, which was a fairly small and fairly innocent kind of movement, Wall Street got paranoid. And basically summoned the New York mayor at the time - who was the Wall Street character Bloomberg - to say 'squash these people.' And so, at this point, the perpetuation of the neoliberal order starts to become more and more guaranteed by state authoritarianism and neoconservatism. Which now, has morphed a little bit into this kind of right-wing populism.
So, in a sense the neoliberal order is being perpetuated by this authoritarian shift. And that should give the Left a good possibility to mount a counter-attack in certain parts of the world.
Indeed, in the early 70s, right after the 1968 movement and when neoliberalism starts to become the dominant ideology, the Left retreated and retired from the idea of a collective struggle.
As Adam Curtis describes in his film, HyperNormalisation :
The extraordinary thing was that no one opposed the bankers. The radicals and the Left wingers who, ten years before, had dreamed of changing America through revolution, did nothing. They had retreated and were living in abandoned buildings in Manhattan. The singer Patti Smith later described the mood of disillusion that had come over them. "I could not identify with the political movements any longer," she said. "All the manic activity in the streets. In trying to join them, I felt overwhelmed by yet another form of bureaucracy." What she was describing was a rise of a new, powerful individualism that could not fit with the idea of collective political action. Instead, Patti Smith and many others became a new kind of individual radical, who watched the decaying city with a cool detachment. They didn't try to change it. They just experienced it.
So, the critical question today is whether the time has come for the Left to revive and exterminate the neoliberal/far-right authoritarian beast.
Dec 25, 2018 | www.unz.com
likbez , says: December 25, 2018 at 8:02 am GMT@guitarzan
>US hegemony is imposed militarily, both covertly and overtly, throughout the world. It is maintained through the petrodollar, corporate power, and the Federal Reserve Bank and its overseas counterparts
All true, but the key element is missing. The USA hegemony is based on ideological hegemony of neoliberalism. And BTW both Russia and China are neoliberal countries. That's probably why President Putin calls the USA administration "partners," despite clearly anti-Russian policies of all US administrations since 1991.
Ability to use military is important but secondary. Without fifth column of national elites which support neoliberalism that would be impossible, or at least more difficult to use. Like it was when the USSR existed (Vietnam, Cuba, etc). The USSR has had pretty powerful military, which was in some narrow areas competitive, or even superior to the USA, but when the ideology of Bolshevism collapsed, the elite changed sides and adopted a neoliberal ideology. This betrayal led to the collapse of the USSR and all its mighty military and the vast KGB apparatus proved to be useless.
In this sense, the article is weak, and some comments are of a higher level than the article itself in the level of understanding of the situation (Simon in London at December 21, 2018, at 9:23 am one example; longevity of neoliberalism partially is connected to the fact that so far there is no clear alternative to it and without the crisis similar to Great Depression adoption of New Deal style measures is impossible )
It is really sad that the understanding that the destiny of the USA is now tied to the destiny of neoliberalism (much like the USSR and Bolshevism) is foreign for many.
So it might well be that the main danger for the US neoliberal empire now is not China or Russia, but the end of cheap oil, which might facilitate the collapse of neoliberalism as a social system based on wasteful use on commodities (and first of all oil)
One fascinating fact that escapes my understanding is why the USA elite wasted colossal advantage it got after the collapse of the USSR in just 25 years or so. I always thought that the USA elite is the most shrewd out of all countries.
May be because they were brainwashed by neocon "intellectuals." I understand that most neocons are simply lobbyists of MIC, and MIC has huge political influence, but still neocon doctrine is so primitive that no civilized elite can take it seriously.
I also understand Eisenhower hypocritical laments that "train with MIC left the station" and that the situation can't be reversed (lament disguised as a "warning"; let's remember that it was Eisenhower who appointed Allen Dulles to head the CIA.
Dec 25, 2018 | www.theguardian.com
For 40 years, the ideology popularly known as "neoliberalism" has dominated political decision-making in the English-speaking west.
People hate it . Neoliberalism's sale of state assets, offshored jobs, stripped services, poorly-invested infrastructure and armies of the forcibly unemployed have delivered, not promised "efficiency" and "flexibility" to communities, but discomfort and misery. The wealth of a few has now swelled to a level of conspicuousness that must politely be considered vulgar yet the philosophy's entrenched itself so deeply in how governments make decisions and allocate resources that one of its megaphones once declared its triumph "the end of history".
... ... ...
Paul Keating's rejection
It was a year ago that a third sign first appeared, when the dark horse of Australian prime ministers, Paul Keating, made public an on-balance rejection of neoliberal economics. Although Liberal PM Malcolm Fraser instigated Australia's first neoliberal policies, it was Keating's architecture of privatisation and deregulation as a Labor treasurer and prime minister that's most well remembered.
Now, "we have a comatose world economy held together by debt and central bank money," Keating has said, "Liberal economics has run into a dead end and has had no answer to the contemporary malaise." What does the disavowal mean? In terms of his Labor heir Bill Shorten's growing appetite for redistributive taxation and close relationship to the union movement, it means "if Bill Shorten becomes PM, the rule of engagement between labour and capital will be rewritten," according to The Australian this week. Can't wait!
Tony Abbott becomes a fan of nationalising assets
Or maybe's Sukkar's right about the socialists termiting his beloved Liberal party. How else to explain the earthquake-like paradigm shift represented by the sixth sign? Since when do neoliberal conservatives argue for the renationalisation of infrastructure, as is the push of Tony Abbott's gang to nationalise the coal-fired Liddell power station? It may be a cynical stunt to take an unscientific stand against climate action, but seizing the means of production remains seizing the means of production, um, comrade. "You know, nationalising assets is what the Liberal party was founded to stop governments doing," said Turnbull, even as he hid in the dens and in the rocks of the mountains to weather – strange coincidence – yet another Newspoll loss.
• Van Badham is a Guardian Australia columnist
uhurhi , 27 Apr 2018 05:43"new introduction to a re-released Marx and Engels' Communist Manifesto. Collective, democratic political action is our only chance for freedom and enjoyment."fleax -> internationalist07 07 , 27 Apr 2018 05:43
Might be true. But frightening that people should naively still think that democracy is to be found in the 'Dictatorship of the Proletariat' [ ie those who know what's good for you even if you don't like it ] of the Communist Manifesto after the revelations of what that leads to in the Gulag Archipelago , Mao's China , Pol Pot , Kim John - un .
How quickly the world forgets. - you might just as well advocate Mein Kampf it's the same thing in the end !most "isms" kill off their rivals and the unbelievers when they usurp powercharleyb23 -> RedmondM , 27 Apr 2018 05:37That's what you claim and it might be so but I'm not interested in keeping a score on the matter. The point you failed to get is that the people you mentioned where totalitarian thugs. They used the banner of communism to achieve their ends. They would have used what ever ideology that was in fashion to achieve the same results.daily_phil , 27 Apr 2018 05:35Does present day neo-liberalism actually qualify as a political movement?
Vested interests and the dollar seem to have all the power. Lies and deception are so common the truth is seen as the enemy. The voting public are merely fools for manipulation. Nah, neo-liberalism is not government, it is something far nastier, and clearly not what the public vote for, presuming a vote actually counts for anything anymore.
For two years, Democrats have waited on Robert Mueller to deliver a death blow to the Trump presidency," The New York Times observed on July 20 . "On Wednesday, in back-to-back hearings with the former special counsel, that wish could face its final make-or-break moment."
very fact that Democrats had to subpoena Mueller in order to create this final moment should in fact be the final reminder of what a mistake it was for Democrats to have waited on him. If Mueller had incriminating information yet to share, or had been stymied from doing his work, or if Attorney General William Barr had somehow misrepresented his findings, then it stands to reason that Mueller would be welcoming the opportunity to appear before Congress, not resisting it. The reality is that Mueller's investigation did not indict anyone on the Trump campaign for collusion with Russia, or even for anything related to the 2016 election. Mueller's report found no evidence of a Trump-Russia conspiracy, and even undermined the case for it .
That said, there are unresolved matters that Mueller's testimony could help clarify. Mueller claimed to have established that the Russian government conducted "a sweeping and systematic" interference campaign in order to elect Trump, yet the contents of his report don't support that allegation. The Mueller report repeatedly excludes countervailing information in order to suggest, misleadingly, that the Trump campaign had suspect "links" and "ties" to people connected with Russia. And Mueller and other intelligence officials involved in the Russia probe made questionable investigative decisions that are worthy of scrutiny. To address these issues, here are some questions that Mueller could be asked...
We Are at a Moment of Great Peril, and the Rule of Law Is All We've Got
Robert Mueller Just Told Congress to Do Its Damn Job
Robert Mueller Obstructed His Own Investigation As Much as Donald Trump
... ... ...
Jeffrey Harrison says: July 23, 2019 at 9:01 pmJeffrey Harrison says: July 23, 2019 at 11:46 pm
You have been very consistent Mr. Mate. I applaud you. Let me make a few observations. There are two things to consider. One is the allegations that resulted in Mueller's so-called investigation and two is the "investigation" itself.
As for the allegation of (a) Russian interference/"meddling" in the 2016, you have provided the ammunition that shoots the allegation full of holes. Timing after the election, minuscule budget compared to actors actually trying to influence the election, advertising content frequently having nothing to do with the election and, finally, a US district judge that pointed out that Mueller hadn't shown that the Russian government was behind the Internet Research Agency and ordered him to cease and desist.
Everybody seems to go oh, well, that's alright at this point but it's not.
The United States government seized Russian owned properties in the United States without compensation, it expelled Russian diplomats and pressed our vassal states to expel Russian diplomats, it expanded an economic war with Russia by increasing the sanctions that the US imposed on Russia for their successful resistance to the US coup in Ukraine as well as barring Russian citizens from obtaining visas to the US.
If the US wants to play law-fare, plausibly the Russians should respond in kind. What we have done to Russia just for any part of this could easily be a tort in a US court. False claims that result in damages are actionable.
Then you have (b) the US claim that the dastardly forces of evil and/or wickedness (the GRU) broke into the DNC computers and stole all these e-mails which demonstrated what a bunch of b***ards the DNC were and released them to the world so that now everybody knew that the DNC was a corrupt and evil organization. More sanctions all around for Russia. Wait, what? Oh, right, the GRU.
There were a number of us who were poking holes in the regime's narrative about the "hack" of DNC and now another federal judge has proof in front of him that, in fact, the murdered Seth Rich and his brother Aaron were the source of a thumb-drive with the e-mails. Oops. But the more sanctions all around on Russia are still in place without any justification. To make matters worse, I read on Reuters that FBI director Wray is claiming that the Russians are going to interfere in the 2020 elections. Has anybody read the story of the little boy who cried wolf? They interfered in the 2016 election....ah, no, they didn't....They were going to interfere in the elections of our European vassals....ah, no, they didn't.
Without putting too fine a point on it, the Mueller "report" is nothing but a tissue of lies, innuendo, and misinformation tantamount to fraud. It probably isn't worth the match to set it on fire (at least with Ken Starr we got something so salacious that we could skip the Playboy). What the Mueller "report" is, however, is a relatively crude effort to cover up the efforts of the "deep state" (FBI, CIA, NSA, DIA, etc etc) to fix the 2016 election for their preferred candidate - Three Names. And that isn't just highly illegal, it's a violation of the oath that you take to uphold the constitution. They should be in jail and somebody should be investigating Seth Rich's murder.
Oh, and by the way. The US chose to violate the Russian embassy facilities at least as flagrantly as the Iranian teenagers did in Tehran but without the excuse of youthful exuberance.
Jul 23, 2019 | www.theguardian.com
The US justice department is opening a broad antitrust review into major technology firms, as criticism over the companies' growing reach and power heats up.
The investigation will focus on growing complaints that the companies are unlawfully stifling competition.
"The Department's review will consider the widespread concerns that consumers, businesses and entrepreneurs have expressed about search, social media, and some retail services online," the Department of Justice said in a statement.
ss="rich-link"> A new antitrust frontier – the issue closing partisan divides in the name of policing big tech Read more
"Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands," added the assistant attorney general Makan Delrahim, of the antitrust division.
The review will investigate practices of online platforms including Facebook , Alphabet's Google, Amazon and Apple.
The investigation comes amid calls from lawmakers, including Democratic presidential candidates such as Elizabeth Warren, that the companies should face more scrutiny.
Lat week, Facebook, Google, and Amazon faced a grilling before the House subcommittee on antitrust, commercial and administrative law over their hold on markets including digital advertising, e-commerce and cloud computing.
Lawmakers questioned Amazon over the fees it levies against third-party sellers on the platform and whether this creates a monopoly of power. They also questioned Facebook executives over practices of targeting startups for acquisition and copying features of companies that decline to be acquired.
Lawmakers also grilled Facebook this month over its plans to launch a global cryptocurrency, called Libra. In the hearing, Senator Sherrod Brown of Ohio said Facebook showed "breathtaking arrogance" in attempting to launch a digital financial service after a number of major privacy scandals.
In July, the Federal Trade Commission approved a $5bn fine against Facebook for its handling of user data surrounding the Cambridge Analytica scandal in 2018.
"Facebook is dangerous," Brown said, likening the company to a toddler playing with matches. "It has burned the house down repeatedly and called every attempt a learning experience. Do you really think people should trust you with their bank accounts and their money?"
The Department of Justice investigation is already under way, the Wall Street Journal reported on Tuesday. The department hosted a private presentation from critics of big technology companies, who walked legislators through concerns and arguments for breaking up the firms.
Facebook, Alphabet , Amazon and Apple did not immediately respond to requests for comment.
Jul 23, 2019 | www.zerohedge.com
Putin was apparently explaining a fairly straightforward and, to many observers, valid assessment of international politics. Namely, that Western establishments and institutions, including the mainstream media, are experiencing a crisis in authority. That crisis has arisen over several years due to popular perception that the governance of the political class is not delivering on democratic demands of accountability and economic progress. That in turn has led people to seek alternatives from the established parties, a movement in the US and Europe which is denigrated by the establishment as "populist" or rabble rousing.
Putin was not advocating any particular politics or political figures. He was merely pointing out the valid observation that the so-called liberal establishment has become obsolete, or dysfunctional.
In her speech this week, May sought to lay on a sinister spin to Putin's remarks as being somehow him egging on authoritarianism and anti-democratic politics.
Another example of distortion came from Donald Tusk, the European Council President, who also said of Putin's interview:
"I strongly disagree with the main argument that liberalism is obsolete. Whoever claims that liberal democracy is obsolete, also claims that freedoms are obsolete, that the rule of law is obsolete and that human rights are obsolete For us in Europe, these are and will remain essential and vibrant values. What I find really obsolete are: authoritarianism, personality cults, the rule of oligarchs."
Tusk's depiction of Putin being anti-democratic, anti-human rights and anti-law is a specious misdirection, or as May would say, "cynical falsehood".
Political leaders like May and Tusk are living in denial. They seem to suffer from a charmed delusion that all is rosy with the state of Western democracy. That somehow Western states are the acme of benign "liberalism".
By blaming evident deep-seated problems of poverty and apathy towards establishment politics on "sinister" targets of "populism" and "authoritarian strong men" is a form of escapism from reality.
In May's case, she has added good reason to escape from reality. Her political career is ending in disaster and disgrace for having led Britain into a shambles over its Brexit departure from the European Union. Of course, she would like a distraction from her abysmal record, and she seemed to find one in her farewell speech by firing a dud diatribe at Putin.
But let's re-examine her self-congratulatory claim more closely. "No one comparing the quality of life or economic success of liberal democracies like the UK, France and Germany to the Russian Federation would conclude that our system is obsolete."
There are two parts to that.
First, May is giving the usual establishment spiel about presumed superiority of Western "liberal democracy" as opposed to politics and governance in Russia.
This week coming, May hands in her resignation as Conservative party prime minister to the unelected head of state, Queen Elizabeth. The British monarch and her heirs rule as official head of state by a presumed "divine order". Some democracy that is!
May's successor will either be Boris Johnson or Jeremy Hunt. The next prime minister of Britain will be elected solely by members of Britain's Conservative party. As the Washington Post noted this week, the Tory party represents less than one per cent of the British population. So, the new leader of the United Kingdom is being decided not by a democratic national mandate, but by a tiny minority of party members whose demographic profile is typically rightwing, ardent nationalists, pro-militarist, white and elderly males. Moreover, the "selection" of new leader comes down to a choice between two politicians of highly dubious quality whose foreign policy tendency is to play sycophants to Washington. The way Johnson and Hunt have, for example, lent support to Trump's reckless aggression towards Iran is a portent of further scraping and bowing to American warmongering typical of Britain's "special relationship".
In the second part of May's presumed virtuous liberal democracy, she hails the "quality of economic success" of her nation as opposed to Russian society.
No-one, least of all Putin, is denying that reducing poverty is a social challenge for Russia. In a recent nationwide televised Q&A, the "elected" (please note) head of the Russian state called poverty reduction a priority for his government. However, Russia certainly doesn't need advice from the United Kingdom or many other Western states on that issue.
A recent major study in Britain found that some 21 per cent of the population (14 million people) are living in poverty. Homelessness and aggravated crime figures are also off the charts due to collapsing public services over a decade of economic austerity as deliberate government policy. The inequality gap between super-rich and poverty among the mass of people has exploded to a chasm in Britain, as in the US and other Western states.
These are some of the urgent issues that Putin was referring to when he asserted the "liberal idea is obsolete". Can anyone objectively surveying the bankrupt state of Western societies honestly dispute that?
Western states are fundamentally broken down because "liberalism" is an empty term which conceals rapacious corporate capitalism and the oligarchic rule of an elite political class. The advocates of "liberalism" like Britain's May, Johnson, Hunt or Tusk are the ones who are anti-democracy, anti-human rights and anti-law. Their denial about the systemic cause of poverty and injustice within their own societies and their complicity in American imperialist warmongering in the Middle East or belligerence towards Russia and China is the true "quality" of their "democratic principles".
If that's not obsolete then what is? And that's why May took a weird parting shot at Putin in a desperate diversion from reality.
Jul 22, 2019 | jessescrossroadscafe.blogspot.com
"When the music stops, in terms of liquidity, things will be complicated. But as long as the music is playing, you've got to get up and dance. We're still dancing,"
Chuck Prince, CEO Citigroup, July 9, 2007
Jul 22, 2019 | jessescrossroadscafe.blogspot.com
"A baited banker thus desponds,
From his own hand foresees his fall,
They have his soul, who have his bonds;
'Tis like the writing on the wall.
How will the caitiff wretch be scared,
When first he finds himself awake
At the last trumpet, unprepared,
And all his grand account to make!
For in that universal call,
Few bankers will to heaven be mounters;
They'll cry, 'Ye shops, upon us fall!
Conceal and cover us, ye counters!'
When other hands the scales shall hold,
And they, in men's and angels' sight
Produced with all their bills and gold,
'Weigh'd in the balance and found light!'
Jonathan Swift, A Run Upon the Bankers
Dec 25, 2018 | www.theguardian.com
For 40 years, the ideology popularly known as "neoliberalism" has dominated political decision-making in the English-speaking west.
People hate it . Neoliberalism's sale of state assets, offshored jobs, stripped services, poorly-invested infrastructure and armies of the forcibly unemployed have delivered, not promised "efficiency" and "flexibility" to communities, but discomfort and misery. The wealth of a few has now swelled to a level of conspicuousness that must politely be considered vulgar yet the philosophy's entrenched itself so deeply in how governments make decisions and allocate resources that one of its megaphones once declared its triumph "the end of history".
It wasn't, as even he admitted later . And given some of the events of the contemporary political moment, it's possible to conclude from auguries like smoke rising from a garbage fire and patterns of political blood upon the floor that history may be hastening neoliberalism towards an end that its advocates did not forecast.
Three years ago, I remarked that comedian Russell Brand may have stumbled onto a stirring spirit of the times when his "capitalism sucks" contemplations drew stadium-sized crowds. Beyond Brand – politically and materially – the crowds have only been growing.
Is the political zeitgeist an old spectre up for some new haunting? Or are the times more like a strong angel proclaiming with a loud voice, "the combination of inequality and low wage growth is fuelling discontent. Time to sing a new song."
In days gone past, they used to slice open an animal's belly and study the shape of its spilled entrails to find out. But we could just keep an eye on the news.
Here are my seven signs of the neoliberal apocalypse:
... ... ...
5. The reds are back under the beds
... ... ...6. Tony Abbott becomes a fan of nationalising assets
... How else to explain the earthquake-like paradigm shift represented by the sixth sign? Since when do neoliberal conservatives argue for the renationalisation of infrastructure, as is the push of Tony Abbott's gang to nationalise the coal-fired Liddell power station?
It may be a cynical stunt to take an unscientific stand against climate action, but seizing the means of production remains seizing the means of production, um, comrade.
"You know, nationalising assets is what the Liberal party was founded to stop governments doing," said Turnbull, even as he hid in the dens and in the rocks of the mountains to weather – strange coincidence – yet another Newspoll loss.
... ... ...
• Van Badham is a Guardian Australia columnist
Jul 17, 2019 | www.theamericanconservative.comHrant , 3 days ago
I've been watching in complete dismay for more than two decades now how many unbelievably empty people run for the highest office in the US. These people are empty. No substance, no soul, no brain or heart. Nothing.
Jul 14, 2019 | www.unz.com
If you have ever traveled in Russia outside of Moscow, you certainly have some horrible stories to tell about its atrocious roads, food and lodging or rather lack thereof. Things have changed greatly, and they keep changing. Now there are modern highways, plenty of cafés and restaurants, a lot of small hotels; plumbing has risen to Western standards; the old pearls of architecture have been lavishly restored; people live better than they ever did. They still complain a lot, but that is human nature. Young and middle-aged Russians own or charter motor boats and sail their plentiful rivers; they own country houses ("dachas") more than anywhere else. They travel abroad for their vacations, pay enormous sums of money for concerts of visiting celebrities, ride bikes in the cities – in short, Russia has become as prosperous as any European country.
This hard-earned prosperity and political longevity allows President Putin to hold his own in the international affairs. He is one of a few experienced leaders on the planet with twenty years at the top job. He has met with three Popes of Rome, four US Presidents, and many other rulers. This is important: 93-years old Prime Minister Mahathir Mohamad who ruled his Malaysia for 40 years and has been elected again said the first ten years of a ruler are usually wasted in learning the ropes, and only after first twenty does he becomes proficient in the art of government. The first enemy a ruler must fight is his own establishment: media, army, intelligence and judges. While Trump is still losing in this conflict, Putin is doing fine – by his Judoka evasive action.
Recently a small tempest has risen in the Russian media, when a young journalist was detained by police, and a small quantity of drugs was allegedly discovered on his body. The police made many mistakes in handling the case. Perhaps they planted the evidence to frame the young man; perhaps they had made the obvious mistakes to frame the government. The response has been tremendous, as if the whole case had been prepared well in advance by the opposition hell-bent to annoy and wake up the people's ire against the police and administration. Instead of supporting the police, as Putin usually does, in this case he had the journalist released and senior police officers arrested. This prompt evasive action undid the opposition's build-up by one masterly stroke.
Recently he openly declared his distaste for liberalism in the interview for the FT . This is a major heresy, like Luther's Ninety-five Theses. "The liberals cannot dictate Their diktat can be seen everywhere: both in the media and in real life. It is deemed unbecoming even to mention some topics The liberal idea has become obsolete. It has come into conflict with the interests of the overwhelming majority of the population." Putin condemned liberals' drive for more immigration. He called Angela Merkel's decision to admit millions of immigrants a "cardinal mistake"; he "understood" Trump's attempt to stop the flow of migrants and drugs from Mexico.
Putin is not an enemy of liberalism. He is rather an old-fashionable liberal of the 19 th century style. Not a current 'liberal', but a true liberal, rejecting totalitarian dogma of gender, immigration, multiculturalism and R2P wars. "The liberal idea cannot be destroyed; it has the right to exist and it should even be supported in some things. But it has no right to be the absolute dominating factor."
In Putin's Russia liberalism is non-exclusive, but presents just one possible line of development. Homosexuals are not discriminated against nor promoted. There are no gay parades, no persecution of gays, either. Russian children aren't being brainwashed to hate their fathers, taken away from their families and given to same-sex maniacs, as it happened in the recent Italian case . Kids aren't being introduced to joys of sex in primary schools. People are not requested to swear love to transgenders and immigrants. You can do whatever you wish, just do not force others to follow you – this is Putin's first rule, and this is true liberalism in my book.
There is very little immigration into Russia despite millions of requests: foreigners can come in as guest workers, but this does not lead to permanent residency or citizenship. The Police frequently check foreign-looking people and rapidly deport them if found in breach of visa rules. Russian nationalists would want even more action, but Putin is a true liberal.
... ... ...
Why does Putin care about the US? Why can't he just stop taking dollars? This means he is an American stooge! – an eager-for-action hothead zealot would exclaim. The answer is, the US has gained a lot of power; much more than it had in 1988, when Reagan negotiated with Gorbachev. The years of being the sole superpower weren't wasted. American might is not to be trifled with.New York Times insinuated.
True, Russia is big enough to survive even that treatment, but Russians have got used to a good life, and they won't cherish being returned to the year 1956. They took action to prevent these worst-case scenarios; for instance, they sold much of their US debt and moved out of Microsoft , but these things are time-consuming and expensive. Putin hopes that eventually the US will abandon its quest for dominance and assume a live-and-let-live attitude as demanded by the international law. Until it happens, he is forced to play by Washington rules and try to limit antagonism.
An experienced broker came in, promising to deliver the deal. It is the Jewish state, claiming to have the means to navigate the US in the desired direction. This is a traditional Jewish claim, used in the days of the WWI to convince the UK to enter the deal: you give us Palestine; we shall bring the US into the European war on your side. Then it worked: the Brits and their Aussie allies stormed Gaza, eventually took over the Holy Land, issued the Balfour declaration promising to pass Palestine to the Jews, and in return, fresh American troops poured into the European theatre of war, causing German surrender.
This time, the Jewish state proposed that Putin should give up his ties with Iran; in return, they promised to assist in general warming of Russo-American relations. Putin had a bigger counter-proposal: Let the US lift its Iran sanctions and withdraw its armed forces from Syria, and Russia will try to usher Iranian armed forces out of Syria, too. The ensuing negotiations around Iran-Syria deal would lead to recognition of the US and Israel interests in Syria, and further on it could lead to negotiations in other spheres.
This was a clear win-win proposal. Iran would emerge free of sanctions; Israel and the US would have their interests recognised in Syria; the much-needed dialogue between Russia and the US will get a jump-start. But Israel does not like win-win proposals. The Jewish state wants clear victories, preferably with their enemy defeated, humiliated, hanged. Israel rejected the proposal, for it wanted Iran to suffer under sanctions.
... ... ...
Russia certainly wants to live in peace with the US, but not at the price Mr Netanyahu suggested. Mr Patrushev condemned the US sanctions against Iran. He said that Iran shot down the giant American drone RQ-4A Global Hawk worth more than a hundred million dollars over Iranian territory, not in the international airspace as the Pentagon claimed. He stated that American "evidence" that Iran had sabotaged tankers in the Persian Gulf was inconclusive. Russia demanded that the United States stop its economic war against Iran, recognize the legitimate authorities of Syria, led by President Bashar Assad, and withdraw its troops from Syria. Russia expressed its support for the legitimate government in Venezuela. Thus, Russia showed itself at this difficult moment as a reliable ally and partner, and at the same time assured the staggering Israeli leadership of its friendship.
The problem is that the drive for war with Iran is not gone. A few days ago, the Brits seized an Iranian super-tanker in the Straits of Gibraltar. The tanker was on its way to deliver oil to Syria. Before that, the United States had almost launched a missile attack on Iran. At the last moment, when the planes were already in the air, Trump stopped the operation. It is particularly disturbing that he himself unambiguously hinted that the operation was launched without his knowledge . That is, the chain of commands in the US is now torn, and it is not clear who can start a war. This has to be taken into account both in Moscow and in Tehran.
... ... ...
Russia wants to help Iran, not out of sheer love to the Islamic Republic, but as a part of its struggle for multi-polar world, where independent states carry on the way they like. Iran, North Korea, Venezuela – their fight for survival is a part and parcel of Russia's struggle. If these states will be taken over, Russia can become the next victim, Putin feels.
... ... ...
In this situation, Putin tries to build bridges to the new forces in Europe and the US, to work with nationalist right. It is not the most obvious partner for this old-fashioned liberal, but they fit into his idea of multi-polarity, of supremacy of national sovereignty and of resistance to the world hegemony of Atlantic powers. His recent visit to Italy, a country with strong nationalist political forces, had been successful; so was his meeting with the Pope.
In the aftermath of the audience with the Pope, Putin strongly defended the Catholic Church, saying that "There are problems, but they cannot be over-exaggerated and used for destroying the Roman Catholic Church itself. I get the feeling that these liberal circles are beginning to use certain problems of the Catholic Church as a tool for destroying the Church itself. This is what I consider to be incorrect and dangerous. After all, we live in a world based on Biblical values and traditional values are more stable and more important for millions of people than this liberal idea, which, in my opinion, is really ceasing to exist". For years, the Europeans haven't heard this message. Perhaps this is the right time to listen.
Israel Shamir can be reached at email@example.com
anonymous  Disclaimer , says: July 6, 2019 at 1:16 pm GMTAl Moanee , says: July 6, 2019 at 8:27 pm GMT
"President Trump seems to have some positive ideas, but his hands are tied up."
Pitifully naive.@Per/NorwayA123 , says: July 6, 2019 at 10:32 pm GMT
The author is referring to WWI and the Balfour Declaration of Nov 1917 which indeed was drafted on behalf of Jewish Zionist interests who in return did their level best in bringing Wilson, who was long backed by NYC banking interests (hence the Federal Reserve Act of 1913 enacted on his watch), into the war which materially changed its dynamics and outcome.Priss Factor , says: July 6, 2019 at 10:33 pm GMT
The Ukraine in all this? I would think it a far bigger concern for Russia in any trilateral meeting.
Do not expect anything on the Ukraine in the near future. Trump wants the DNC to nominate guaranteed loser Biden. Then he can beat him senseless using 'Ukrainian tampering with U.S. elections' via Biden's family business interests (1).
Now that the Mueller exoneration is complete, the door is open to improved U.S. – Russia relations. The important thing is looking at Putin's and Trump's actions , more so than their words.
Trump's words sound 'officially concerned' about Crimea. However, this is primarily for EU consumption. What actions has the Trump administration taken about Crimea? Little or nothing depending on how you score the matter. So tacit acknowledgement pending a quid pro quo .
Putin administration words (but not Putin himself) have said strong sounding things about Iran. However, there are no actions that support a deep relationship.
-- Russia sells munitions to Iran on a 'cash & carry' basis along with many other nations including Turkey. Russia and Israel have much stronger ties on the military equipment basis. Look at their recent joint sale of AWACS to India (2).
-- Russia continues to let the Israeli air force freely strike Iranian al'Hezbollah and al'Quds targets in Syria.
It looks like the quid pro quo arrangement will be Crimea for an Iranian exit from Syria. It's a deal that would help peace throughout the region.
(2) https://timesofindia.indiatimes.com/india/india-to-buy-2-more-awacs-worth-rs-5-7k-crore-from-israel/articleshow/67765253.cmsA123 , says: July 6, 2019 at 11:08 pm GMT
Was Pat Robertson right about World War I?
https://israelpalestinenews.org/rothschild-reveals-crucial-role-ancestors-played-balfour-declaration-creation-israel/Rabbitnexus , says: July 7, 2019 at 2:49 am GMT
But he is hampered by his "deep state", by Pompeo and Bolton; about the latter, Trump himself said that he wants to fight with the whole world. Presidents can't always remove the ministers from whom they want to get rid of – even the absolute monarchs of the past did not always succeed.
Actually, Trump is using Bolton against the deep state.
First and foremost, it is and advanced and skillful form of ' Good Cop – Bad Cop '. When Bolton says something and Trump openly disagrees, it places the Fake Steam Media complex in an untenable position. If they treat the story fairly, they embrace the anathema of saying positive things about Trump. But they do not have any options to twist the facts into their desired anti-American propaganda.
Secondarily, it also cleverly drives a wedge between two DNC factions:
-1- The true Clintonista believer, stricken by Trump Derangement Syndrome [TDS], will not accept anything less than Impeachment. Preferably followed by turning him over to the Fascist Stormtroopers of Antifa.
-2- Those with a less deranged view realise that a successful Impeachment process would generate President Pence. And, he would be much more likely to accept Bolton's advice. Perhaps Pence would pick Bolton to be Vice President.
Look at the circular firing squad that is forming up in the DNC nomination process to see how Trump's deliberate agitation of various factions is working in his favor. The TDS faction is winning and as a result the eventual DNC candidate will be unelectable.
PEACE@AghaHussain sts plans have failed to materialise in Syria. The author here does a very good job of explaining Russia's position and between his and Saker's analyses your argument is kaput and only fools would buy it.A123 , says: July 7, 2019 at 2:39 pm GMT
The Zionists went away empty handed with their visits to Russia and President Putin and if anything Russia's resistance to the Zionists has hardened lately.
People who have two dimensional thinking and a limited box of clues seem to think it is as simple as just saying no and digging their heels in but that way makes wars. Russia does not have the sort of power nor an insane leadership that it would take for that.@animalogic to be rebuilt.iendly Neighbourhood Terrorist , says: Website July 13, 2019 at 1:48 pm GMT
The best hope for an internal Iranian solution is IRGC enlightened self interest. A fairly bloodless replacement of Khameni with a general from the IRGC. It worked in Egypt and the world welcomed that military solution. One can be 99% certain that replacing Khameni would be just as welcome.
The new 'General Ayatollah in Chief' would have a free hand to disengage from Khameni's extremism. The economic recovery from ending sanctions would guarantee internal popularity. Think of it as MIGA, Make Iran Great Again , though they are unlikely to use that exact phrase.
PEACEChe Guava , says: July 13, 2019 at 3:42 pm GMT
It's ludicrous to imagine that Russians are so wedded to the good life that they do not dare antagonise Amerikastan. What "good life" is this? Ask the pensioners struggling on a few thousand rubles a month how the hell they are supposed to manage. The luxuries enjoyed by the yuppies in Moscow (most of whom, fluently English speaking and firmly pro-Amerikastani, are a fifth column of Quislings) are not the life that the factory worker in Volgograd or the farmer outside St Petersburg will recognise.Republic , says: July 13, 2019 at 3:44 pm GMT
Pres. Putin seems to be a pretty good person.
I want to sidetrack the thread to the matter of Edward Snowden.
Putin made a comment early on 'a strange young man'.
I understand exactly what he was saying. I am the same. No leaks. ht is a matter of honour.
OTOH, confronted by wall-to-wal evil bullshit as he was, I think he was not in the wrong (but have a little internal conflict on that, since the secrets 4 have to keep now are ooly technical and at times commercial, such a dilemna never arises.
In no situation would such be ethical.
he was sorry for Sowden's girlfriend, he dumped her. but, not long after, she was with him. Very romantic. Doubtless, Russian secret services had some role.
I like the happy ending there, it is very romantic.
Would make a great movie, but not possible from Hollywood, perhaps Russia could revive its moribund film industry?@MalacaayAgent76 , says: July 13, 2019 at 4:29 pm GMT
Anatoly Karlin published this two years ago:
10 ways Russia is better than the USAnonFromTN , says: July 13, 2019 at 6:28 pm GMT
Oct 20, 2018 Putin: Russia Getting Rid Of US Dollar Matter Of National Security
Russian president Vladimir Putin: "That's what our American friends are doing. They're undermining trust in the dollar as a universal payment instrument and the main reserve currency."
Jun 8, 2018 Putin hints at end of dollar system – Direct Line 2018
Vladimir Putin has held his 16th Direct Line Q&A on June 7th.
https://www.youtube.com/embed/z01S7lOq-qI?feature=oembed@AmRusDebate t in 2014, and had gone so deep that there is no light at the end of the tunnel now. It is still used by the Empire as an annoying sore right next to Russia, but that's all it can be. It did not and could not deliver what the Empire was hoping for. The imperial planners never take into account the critical condition for their "color revolutions" to bring US-friendly compradores to power anywhere: the country in question must be rotten through and through. Thus, instead of useful sharp tools they get worthless pieces of shit. They are still trying to use an inevitable stink for their purposes, but that's the only use shit is good for.AnonFromTN , says: July 13, 2019 at 6:56 pm GMT@Fiendly Neighbourhood TerroristRadicalCenter , says: July 13, 2019 at 7:04 pm GMT
It's not just Moscow yuppies. Visit any provincial city in Russia today and you'd see that it looks way better than it ever did in the USSR. There are cafes everywhere and lots of people in them spending serious money, because they can afford that. Drive on any road, in or between the cities, and you can see that the roads are in a better shape than they ever were, and there are lots of gas stations, cafes, and hotels along them, all doing brisk business. Russians have ten times more cars now than they had in the USSR, and they drive a lot.@A123 be deployed right on Russia's border on yet another side. Russia would be readily bottled up and be denied the freedom to navigate through the surrounding waters. And it would be more vulnerable to land invasion from more points.Ace , says: July 13, 2019 at 7:19 pm GMT
Russia should continue disentangling itself from US and US-Controller financial systems and institutions. Keep becoming more able to sustain its people without so many imports of foodstuffs and manufactured goods alike.
Far from giving up Crimea, Russia should bide its time and wait to retake the Donbass region or more when Ukraine collapses, breaks up, and/or is outright occupied by the US.@A123RadicalCenter , says: July 13, 2019 at 7:25 pm GMT
I rather doubt you're in any position to judge whether Khameni is a sociopath.
And your fixation on regime change is noted. The ultimate expression of Western arrogance: You, you benighted, retrograde, sociopathic worm, are not a fit chief executive of your nation so we have decided you must go. If we have to kill hundreds of thousands of your people that's just an unavoidable cost of our being the excellent people we are.@Twodees PartainBeefcake the Mighty , says: July 13, 2019 at 9:55 pm GMT
Trump should put the warmongering establishment on the back foot by firing Bolton and hiring Tulsi Gabbard.
Watch the media contort itself deciding how to slander and attack a partly nonwhite "progressive" "pro-choice" woman who is also a veteran, LOL.
What if trump did this a month BEFORE the election?@Harbinger
Liberalism in the West today is similar to communism in the SU in the late 80's: a decrepit ideology that offers nothing to ordinary people and whose adherents are incapable of anything but mouthing the same rubbish over and over. It will similarly die a well-deserved death.
Feb 13, 2019 | jessescrossroadscafe.blogspot.com
"He drew near and saw the city, and he wept for it saying, 'If you had only recognized the things that make for peace. But now you are blinded to them. Truly, the days will come when your enemies will set up barriers to surround you, and hem you in on every side. Then they will crush you into the earth, you and your children. And they will not leave one stone upon another, because you did not recognize the way to your salvation.'"
"You hypocrites! You build monuments for the prophets and decorate the graves of the righteous. And you say, 'If we had lived in the days of our ancestors, we would not have taken part with them in shedding the blood of His messengers.'"
...the results of the Senate GOP finding no evidence of 'collusion' with Russia by the Trump Administration to influence the results of the presidential election..
This last item is not surprising, because this entire Russian collusion meme seems as though it is an hysterical reaction to the spin put out by the Clinton political faction and their neoliberal enablers after their shocking loss in the 2016 Presidential election.
Too bad though, because the financial corruption and private pilfering using public power, money laundering and the kind of soft corruption that is rampant amongst our new elite is all there. And by there we mean on both sides of the fence -- which is why it had to take a back seat to a manufactured boogeyman.
... ... ...
There is a long road ahead before we see anything like a resolution to this troubling period in American political history.
We look back at other troubled periods and places, and either see them as discrete and fictional, a very different world apart, or through some rosy lenses of good old times which were largely benign and peaceful. We fail to see the continuity, the similarity, and the commonality of a dangerous path with ourselves. As they did with their own times gone by. Madness blinds its acolytes, because they wish it so. They embrace it to hide their shame.
We are reassured and misled by the same kinds of voices that have always served the status quo and the monied interests, the think tanks, the so-called 'institutes,' and the web sites and former con men who offer a constant stream of thinly disguised propaganda and misstatements of principle and history. We are comforted by their lies.
People want to hear these reassuring words of comfort and embrace it like a 'religion,' because they do not wish to draw the conclusions that the genuine principles of faith suggest (dare we say command in this day and age) in their daily lives. They blind themselves by adopting a kind of a schizoid approach to life, where 'religion' occupies a discrete, rarefied space, and 'political or economic philosophy' dictates another set of everyday 'practical' observances and behaviors which are more pliable, and pleasing to our hardened and prideful hearts.
We wish to strike a deal with the Lord, and a deal with the Devil -- to serve both God and Mammon as it suits us. It really is that cliché. And it is so finely woven into the fabric of our day that we cannot see it; we cannot see that it is happening to us and around us.
And so we trot on into the abyss, one exception and excuse and rationalization for ourselves at a time. And we blind ourselves with false prophets and their profane theories and philosophies.
As for truth, the truth that brings life, we would interrupt the sermon on the mount itself, saying that this sentiment was all very well and good, but what stocks should we buy for our portfolio, and what horse is going to win the fifth at Belmont? Tell us something useful, practical! Oh, and can you please fix this twinge in my left shoulder? It is ruining my golf game."Those among the rich who are not, in the rigorous sense, damned, can understand poverty, because they are poor themselves, after a fashion; they cannot understand destitution. Capable of giving alms, perhaps, but incapable of stripping themselves bare, they will be moved, to the sound of beautiful music, at Jesus's sufferings, but His Cross, the reality of His Cross, will horrify them. They want it all out of gold, bathed in light, costly and of little weight; pleasant to see, hanging from a woman's beautiful throat."No surprise in this. It has always been so, especially in times of such vanity and greed as are these. Then is now. There is nothing new under the sun. And certainly nothing exceptional about the likes of us in our indulgent self-destruction.
Are you not entertained?
Feb 12, 2017 | economistsview.typepad.comyuan -> Jim Harrison ... , February 10, 2017 at 12:34 PMJim Harrison -> yuan... , February 10, 2017 at 01:46 PM"Does anybody around here have anything useful to suggest"
both demonstration and general strikes are powerful ways to express popular outrage. one is planned on for the 17th (too soon) and another more organized one is being planned for march.
"but you have no more of an idea of a global replacement for capitalism"
so the British welfare state, the war on poverty/great society policy era, and the Scandinavian social model are impossible pipe dreams because..."the British welfare state, the war on poverty/great society policy era, and the Scandinavian social model are" not replacements for capitalism. They are forms of capitalism. And the sorts of policies that go with these versions of conventional social democracy are...pretty much the platform articles that Clinton ran on. Which is the serious reason the American right despised Hillary. They, at least, didn't have any trouble telling the candidates apart.yuan -> Jim Harrison ... , February 10, 2017 at 04:50 PM
There are two problems with storming the Winter Palace. First, you won't have a decisive majority of Americans behind you. Second, you have no idea what you'd do if somehow did seize the Winter Palace. You could conceivably solve the first problem by going balls out demagogue a la Hugo Chavez; but, like Chavez, you'd have to dispense with democracy to keep power because you have no solution to the second problem. For my money, a decent social democracy-universal healthy care, more progressive taxes, a higher minimum wage, more affordable college education, etc.- is plenty hard enough to secure."They are forms of capitalism."
Before the long-decline began in the 70s, a large fraction of the UK's economic activity was chartered, regulated, and/or managed for the people. That's not capitalism, by definition. (Socialism was a market/trade-based system at its inception. The tendencies with alternative economic models came later.)
Some history: https://en.wikipedia.org/wiki/Clause_IV
And Corbyn has returned labor to its socialist roots: http://www.independent.co.uk/news/uk/politics/jeremy-corbyn-to-bring-back-clause-four-contender-pledges-to-bury-new-labour-with-commitment-to-10446982.html
"And the sorts of policies that go with these versions of conventional social democracy are...pretty much the platform articles that Clinton ran on."
I guess I missed Clinton advocating for the nationalization of health care, education, energy production, and transportation.
And the "welfare state" has little to do with "social democracy" (whatever that recent nonsense phrase means), all of them were developed by socialist movements.
Nov 10, 2016 | discussion.theguardian.com
CosmoCrawley, 10 Nov 2016 10:44Cuniform -> CosmoCrawley 0 1
It wasn't just free trade that the white working class voters of the rust belt states were angry about, it was also high immigration. Naomi doesn't mention this, probably because fluid borders is one policy which the Davos class and left-liberals like herself agree on.
Such a[n intersection left] coalition is possible. In Canada, we have begun to cobble it together under the banner of a people's agenda called The Leap Manifesto, endorsed by more than 220 organisations from Greenpeace Canada to Black Lives Matter Toronto, and some of our largest trade unions.
And if such a coalition of the usual suspects got off the ground in the USA it would just about seal a second term for Donald.JulesBywaterLees -> CosmoCrawley
Would this be a movement that would see us being turned from supine consumers back into citizens who actively care about more than a new TV?
Otherwise, look to see a recurrence, here and elsewhere, of the riots we saw in England in 2011.nollafgm -> Cuniform
government for the centre ground has been about management- the days when the US New Deal funded by taxing the rich and which built the wealth Americans now miss, and the Labour post war government that built the NHS [and taxed the rich] is part of history. Instead we have no new innovation but a little bit of tweaking with banks and global business.
No government wants to upset the powers that run the economy- so a multinational can move its workforce to a country with lower pay, lower environmental regulation- it can use the inequality to move not only manufacturing but people.
In return the gutted communities become less smart and given bread and circuses but their privilege and lack of mobility means they don't travel to pick fruit elsewhere- yet they still demand food on the table and the only ones prepared to travel and work hard are the even greater poor.
And the right simply blames the immigrants, the others and you believe them.
don't stop at 2011, the precedent started in 1934 in Nuremberg Germany. Trump used the same how to manual written by Goebbels, he got the idea from the Romans.
Jul 06, 2019 | discussion.theguardian.com
zephirine -> josephinireland
The idea of the 'American dream' seems to have morphed into a nasty belief that if you're poor it's your own fault. You didn't 'want it enough'. You must be secretly lazy and undeserving, even if you're actually working three jobs to survive, or even if there are no jobs.
This view has taken hold in the UK too, where the tabloids peddle the view that anyone who claims state benefits must be a fraud. But at least, people here and in mainland Europe have the direct experience of war within living memory and we understand that you can lose everything through no fault of your own. In the US, even when there's a natural disaster like Katrina it seems to be the poor people's fault for not having their own transport and money to go and stay somewhere else.
It always seems very odd to me that so many people who think like that profess to be Christian. 'Poverty equals moral failure' is the complete opposite of what Jesus Christ got into so much trouble for saying.
Jul 06, 2019 | www.nakedcapitalism.com
The more a local economy has been negatively affected by the two shocks, the more its electors have shifted towards the radical right and its policy packages. These packages typically combine the retrenchment against international openness and the liberalisation of the internal market and more convincingly address the demand for protection by an electorate that, after the austerity following the Crisis, no longer trusts alternatives based on more liberal stances on foreign relations and the parallel promise of a stronger welfare state.
A big reason why liberal democracies in Europe have remained relatively stable since WWII is that most Europeans have had hope that their lives will improve. A big reason why the radical vote has recently been on the rise in several European countries is that part of the electorate has lost this hope. People are increasingly worried that not only their own lives but also the lives of their children will not improve and that the playing field is not level.
On the one hand, despite some progress in curtailing 'tax havens' in recent years, there has never been as much wealth in tax havens as there is today (Zucman 2015). This is seen as unfair because, if public goods and services (including those required to help the transition to a 'green economy') have to be provided in the regions where such hidden wealth comes from, lost tax revenues have to be compensated for by higher taxes on law-abiding households.
On the other hand, fairness is also undermined by dwindling social mobility. In the last decades, social mobility has slowed down across large parts of the industrialised world (OECD 2018), both within and between generations. Social mobility varies greatly across regions within countries, correlates positively with economic activity, education, and social capital, and negatively with inequality (Güell at al. 2018). Renewed migration from the South to the North of Europe after the Crisis (Van Mol and de Valk 2016) is a testimony of the widening relative lack of opportunities in the places that have suffered the most from competition from low-wage countries.
Globalisation has come accompanied by the Great Convergence between countries around the world but also the Great Divergence between regions within several industrialised countries. The same holds within the EU. In recent years, redistributive policies have had only a very limited impact in terms of reversing growing regional inequality.
As a result, the traditional liberal package of external liberalisation and internal redistribution has lost its appeal with the electorate, conceding ground to the alternative package of the radical right that consists of external protectionism and internal liberalisation.
This is both inefficient and unlikely to lead to more regional convergence. What the political and policy debate in Europe is arguably missing is a clearer focus on two of the main underlying causes of peoples' growing distrust in national and international institutions: fiscal fairness and social mobility.
See original post for references
Jesper , July 3, 2019 at 12:37 pm
When did this traditional liberal package mentioned in the concluding remarks ever happen?
the traditional liberal package of external liberalisation and internal redistribution has lost its appeal with the electorate
Maybe if it was clear who got it, what it was, when it was done, how it happened then people might find this liberal package appealing.
flora , July 3, 2019 at 11:26 pm
Right. It would be better to say "the traditional New Deal liberal package " has not lost its appeal, it was killed off bit by bit starting with NAFTA. From a 2016 Thomas Frank essay in Salon:
That appeal to [educated credentialed] class unity gives a hint of what Clintonism was all about. To owners and shareholders, who would see labor costs go down as they took advantage of unorganized Mexican labor and lax Mexican environmental enforcement, NAFTA held fantastic promise. To American workers, it threatened to send their power, and hence their wages, straight down the chute. To the mass of the professional-managerial class, people who weren't directly threatened by the treaty, holding an opinion on NAFTA was a matter of deferring to the correct experts -- economists in this case, 283 of whom had signed a statement declaring the treaty "will be a net positive for the United States, both in terms of employment creation and overall economic growth."
The predictions of people who opposed the agreement turned out to be far closer to what eventually came to pass than did the rosy scenarios of those 283 economists and the victorious President Clinton. NAFTA was supposed to encourage U.S. exports to Mexico; the opposite is what happened, and in a huge way. NAFTA was supposed to increase employment in the U.S.; a study from 2010 counts almost 700,000 jobs lost in America thanks to the treaty. And, as feared, the agreement gave one class in America enormous leverage over the other: employers now routinely threaten to move their operations to Mexico if their workers organize. A surprisingly large number of them -- far more than in the pre-NAFTA days -- have actually made good on the threat.
Twenty years later, the broader class divide over the subject persists as well. According to a 2014 survey of attitudes toward NAFTA after two decades, public opinion remains split. But among people with professional degrees -- which is to say, the liberal class -- the positive view remains the default. Knowing that free-trade treaties are always for the best -- even when they empirically are not -- seems to have become for the well-graduated a badge of belonging.
The only internal redistribution that's happened in the past 25 – 30 yearsis from the bottom 80% to the top 10% and especially to the top 1/10th of 1 %.
Not hard to imagine why the current internal redistribution model has lost its appeal with the electorate.
Sound of the Suburbs, , July 3, 2019 at 1:50 pm
UK policymakers had a great plan for globalisation.
Everyone needs to specialise in something and we will specialise in finance based in London.
That was it.
rd , , July 3, 2019 at 1:58 pm
I think there are two different globalizations that people are responding to.
1. Their jobs go away to somewhere in the globe that has lower wages, lower labor protections, and lower environmental protections. So their community largely stays the same but with dwindling job prospects and people slowly moving away.
2. The world comes to their community where they see immigrants (legal, illegal, refugees) coming in and are willing to work harder for less, as well as having different appearance, languages, religion, and customs. North America has always had this as we are built on immigration. Europe is much more focused on terroire. If somebody or something has only been there for a century, they are new.
If you combine both in a community, you have lit a stick of dynamite as the locals feel trapped with no way out. Then you get Brexit and Trump. In the US, many jobs were sent overseas and so new people coming in are viewed as competitors and agents of change instead of just new hired help. The same happened in Britain. In mainland Europe with less inequality and more job protection, it is more of just being overwhelmed by the sheer quantity of newcomers in a society that does not prize that at all.
Sound of the Suburbs, , July 3, 2019 at 2:04 pm
I saw the warning signs when Golden Dawn appeared in Greece
The liberals said it was just a one off, as they always do, until it isn't.
How did successful Germany turn into a country where extremism would flourish?
The Hartz IV reforms created the economic hardship that causes extremism to flourish.
"Germany is turning to soft nationalism. People on low incomes are voting against authority because the consensus on equality and justice has broken down. It is the same pattern across Europe," said Ashoka Mody, a former bail-out chief for the International Monetary Fund in Europe.
Mr Mody said the bottom half of German society has not seen any increase in real incomes in a generation. The Hartz IV reforms in 2003 and 2004 made it easier to fire workers, leading to wage compression as companies threatened to move plants to Eastern Europe.
The reforms pushed seven million people into part-time 'mini-jobs' paying €450 (£399) a month. It lead to corrosive "pauperisation". This remains the case even though the economy is humming and surging exports have pushed the current account surplus to 8.5pc of GDP."
This is a successful European country, imagine what the others look like.
Adam1 , July 3, 2019 at 2:20 pm
"British referendum on EU membership can be explained to a remarkable extent as a vote against globalisation much more than immigration "
As an FYI to the author immigration is just the flip side of the same coin. Why were immigrants migrating? Often it's because they can no longer make a living where they left. Why? Often globalization impacts.
Summer , July 3, 2019 at 4:23 pm
Another recap about that really just mourns the lack of trust in the establishment, with no answers. More "I can't believe people are sick to death of experts of dubious skills but networking "
What it is just admitted that a system that can only work great for 20% of any given population if they are born in the right region with the right last name just simply not work except as an exercise in extraction?
And about the EU as if it could never be taken over by bigger authoritatians than the ones already populating it. Then see how much those who think it is some forever bastion of liberalism over sovereignity likes it .
Which is worse - bankers or terrorists , July 4, 2019 at 7:21 am
"Another recap about that really just mourns the lack of trust in the establishment, with no answers."
Usually it involves replacing the establishment or creating an internal threat to reinstate compliance in the establish (Strauss and Howe).
Strategies for initiate the former may be impossible in this era where the deep state can read your thoughts through digital media so you would like it would trend to the latter.
stan6565 , July 3, 2019 at 4:35 pm
Mmmmm, yes, migration, globalisation and such like.
But, unregulated migration into an established environment, say a country, say, UK, on one hand furthers profits to those benefiting from low labour wages (mainly, friends of people working for governments), but on the other leads to creation of parallel societies, where the incoming population brings along the society they strived to escape from. The Don calls these sh***hole societies. Why bring the f***ing thing here, why not leave it where you escaped from.
But the real betrayal of the native population happens when all those unregulated migrants are afforded immediate right to social security, full access to NHS and other aspects of state support, services that they have not paid one penny in support before accessing that particular government funded trough. And then the parasitic growth of their "family and extended family" comes along under the banner of "human rights".
This is the damnation of the whole of Western Civilisation which had been hollowed out from within by the most devious layer of parasitic growth, the government apparatus. The people we pay for under the auspices that they are doing some work for us, are enforcing things that treat the income generators, the tax paying society as serfs whose primary function in life is to support the parasites (immigrants) and parasite enablers (government).
The laws of biology and physics and whatever else say that the host that is being parasitised upon, cannot support the endless growth of the parasites attached upon it. The unfortunate host will eventually die.
Understanding of this concept is most certainly within mental capabilities of all those employed as the "governing classes " that we are paying for through our taxes.
Until such time when legislation is enacted that each and every individual member of "government classes " is made to pay, on an indemnity basis, through financial damages, forced labour, organs stripping or custodial penalties, for every penny (or cent, sorry, yanks), of damage they inflict on us taxpayers, we are all just barking.
Skip Intro , July 3, 2019 at 4:49 pm
This piece does an admirable job conflating globalisation and the ills caused by the neoliberal capture of social democratic parties/leaders. Did people just happen to lose hope, or were they actively betrayed? We are left to guess.
"negative effects of globalisation: foreign competition, factory closures, persistent unemployment, stagnating purchasing power, deteriorating infrastructures and public services"
Note that these ills could also be laid at the feet of the austerity movement, and the elimination/privatisation of National Industrial Policy, both cornerstones of the neoliberal infestation.
Summer , July 3, 2019 at 5:56 pm
Not only is globalization not new, all of the issues that come with it are old news.
All of it.
Part of the problem is that the global economic order is still in service to the same old same old. They have to rebrand every so often to keep the comfortable even more comfortable.
Those tasked with keeping the comfortable more comfortable have to present this crap as "new ideas" for their own careerism or actually do not realize they haven't espoused a new idea in 500 years.
K Lee , July 5, 2019 at 9:12 am
Putin's recent interview with Financial Times editor offers a clear-eyed perspective on our changing global structure:
"What is happening in the West? What is the reason for the Trump phenomenon, as you said, in the US? What is happening in Europe as well? The ruling elites have broken away from the people. The obvious problem is the gap between the interests of the elites and the overwhelming majority of the people.
Of course, we must always bear this in mind. One of the things we must do in Russia is never to forget that the purpose of the operation and existence of any government is to create a stable, normal, safe and predictable life for the people and to work towards a better future.
You know, it seems to me that purely liberal or purely traditional ideas have never existed. Probably, they did once exist in the history of humankind, but everything very quickly ends in a deadlock if there is no diversity. Everything starts to become extreme one way or another.
Various ideas and various opinions should have a chance to exist and manifest themselves, but at the same time interests of the general public, those millions of people and their lives, should never be forgotten. This is something that should not be overlooked.
Then, it seems to me, we would be able to avoid major political upheavals and troubles. This applies to the liberal idea as well. It does not mean (I think, this is ceasing to be a dominating factor) that it must be immediately destroyed. This point of view, this position should also be treated with respect.
They cannot simply dictate anything to anyone just like they have been attempting to do over the recent decades. Diktat can be seen everywhere: both in the media and in real life. It is deemed unbecoming even to mention some topics. But why?
For this reason, I am not a fan of quickly shutting, tying, closing, disbanding everything, arresting everybody or dispersing everybody. Of course, not. The liberal idea cannot be destroyed either; it has the right to exist and it should even be supported in some things. But you should not think that it has the right to be the absolute dominating factor. That is the point. Please." ~ Vladmir Putin
He's talking about the end of neoliberalism, the economic fascism that has gripped the world for over 40 years:
"If you're not willing to kill everybody who has a different idea than yourself, you cannot have Frederick Hayek's free market. You cannot have Alan Greenspan or the Chicago School, you cannot have the economic freedom that is freedom for the rentiers and the FIRE (finance, insurance, real estate) sector to reduce the rest of the economy to serfdom." ~ Michael Hudson
Let's get back to using fiscal policy for public purpose again, to granting nations their right to self-determination and stopping the latest desperate neoliberal attempt to change international norms by installing fascist dictators (while pretending they are different) in order to move the world backwards to a time when "efforts to institutionalize standards of human and civil rights were seen as impingements on sovereignty, back to the days when no one gave a second thought to oppressed peoples."
kristiina , July 4, 2019 at 2:47 am
Very interesting article, and even more interesting conversation! There is a type of argument that very accurately points out some ills that need addressing, and then goes on to spout venom on the only system that might be able to address those ills.
It may be that the governing classes are making life easy for themselves. How to address that is the hard and difficult issue. Most of the protection of the small people comes from government. Healthcare, schools, roads, water etc.(I'm in scandinavia).
If the government crumbles, the small people have to leave. The most dreadful tyranny is better than a failed state with warring factions.
The only viable way forward is to somehow improve the system while it is (still) running. But this discussion I do not see anywhere.
If the discussion does not happen, there will not be any suggestions for improvement, so everything stays the same. Change is inevitable – it what state it will catch us is the important thing. A cashier at a Catalonian family vineyard told me the future is local and global: the next level from Catalonia will be EU. What are the steps needed to go there?
SteveB , July 4, 2019 at 5:54 am
Same old, Same old. Government is self-corrupting and is loath to change. People had enough July fourth 1776.
"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.–That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, –That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness."
FWIW: The fireworks we watch every Fourth of July holiday are symbolic!!!!
John , July 4, 2019 at 5:43 pm
The cashier seems to be envisioning a neoliberal paradise where the nation-state no longer exists. But who, then, collects the taxes that will pay for infrastructure, healthcare, education, public housing, and unemployment insurance? The European Parliament?
Will Germans and Finns be willing to pay high taxes in order to pay for those services for Greeks and Spaniards?
Look at the unemployment rate in Greece the Germans would simply say that the Greeks are lazy parasites and don't want to work (rather than understand that the economic conditions don't allow for job creation), and they would vote for MEPs that vote to cut taxes and welfare programs.
But maybe this was the plan all along you create this neoliberal paradise, and slowly but surely, people will dismantle all but the bare bones of the welfare state.
John , July 4, 2019 at 5:35 pm
I believe that one of the fundamental flaws in the logic behind the EU is this assumption of mobility. Proponents of the EU imagine society to be how it is described in economics textbooks: a bunch of individual actors seeking to maximize their incomes that don't seem to exist in any geographic context. The reality is that people are born into families and communities that speak a language. Most of them probably don't want to just pack up all of their things, relocate, and leave their family and home behind every time they get a new job. People throughout history have always had a very strong connection to the land on which they were raised and the society into which they were brought up; more accurately, for most of human history, this formed the entire existence, the entire universe, of most people (excluding certain oppressed groups, such as slaves or the conquered).
Human beings are not able to move as freely as capital. While euros in Greece can be sent to and used instantly in Germany, it is not so easy for a Greek person to leave the society that their ancestors have lived in for thousands of years and move to a new country with a new culture and language. For privileged people that get to travel, this doesn't sound so bad, but for someone whose family has lived in the same place for centuries and never learned to speak another language, this experience would be extremely difficult. For many people over the age of 25, it might not even be a life worth living.
In the past, economic difficulties would lead to a depreciation of a nation's currency and inflation. But within the current structure of the Eurozone, it results in deflation as euros escape to the core countries (mainly Germany) and unemployment. Southern Europeans are expected to leave everything they have ever known behind and move to the countries where there is work, like Germany or Holland. Maybe for a well-educated worldly 18 year old, that's not so bad, but what about a newly laid-off working class 35 year-old with a wife and kids and no college degree? He's supposed to just pick up his family and leave his parents and relatives behind, learn German, and spend the rest of his life and Germany? His kids now have to be German? Would he even be able to get a job there, anyway? Doing what? And how is he supposed to stop this from happening, how is he supposed to organize politically to keep jobs at home? The Greek government can hardly do anything because the IMF, ECB, and European Commission (all unelected officials) call the shots and don't give them any fiscal breathing room (and we saw what happened the last time voters tried to assert their autonomy in the bailout deal referendum), and the European Parliament doesn't have a serious budget to actually do anything.
I'm surprised more people don't vote for neo-fascist parties like the Golden Dawn. Ordinary liberal politics has completely failed them.
Aug 21, 2016 | www.theguardian.com
... ... ...
The neoliberal era is being undermined from two directions. First, if its record of economic growth has never been particularly strong, it is now dismal. Europe is barely larger than it was on the eve of the financial crisis in 2007; the United States has done better but even its growth has been anaemic. Economists such as Larry Summers believe that the prospect for the future is most likely one of secular stagnation .
Worse, because the recovery has been so weak and fragile, there is a widespread belief that another financial crisis may well beckon. In other words, the neoliberal era has delivered the west back into the kind of crisis-ridden world that we last experienced in the 1930s. With this background, it is hardly surprising that a majority in the west now believe their children will be worse off than they were. Second, those who have lost out in the neoliberal era are no longer prepared to acquiesce in their fate – they are increasingly in open revolt. We are witnessing the end of the neoliberal era. It is not dead, but it is in its early death throes, just as the social-democratic era was during the 1970s.
A sure sign of the declining influence of neoliberalism is the rising chorus of intellectual voices raised against it. From the mid-70s through the 80s, the economic debate was increasingly dominated by monetarists and free marketeers. But since the western financial crisis, the centre of gravity of the intellectual debate has shifted profoundly. This is most obvious in the United States, with economists such as Joseph Stiglitz, Paul Krugman, Dani Rodrik and Jeffrey Sachs becoming increasingly influential. Thomas Piketty's Capital in the Twenty-First Century has been a massive seller. His work and that of Tony Atkinson and Angus Deaton have pushed the question of the inequality to the top of the political agenda. In the UK, Ha-Joon Chang , for long isolated within the economics profession, has gained a following far greater than those who think economics is a branch of mathematics.
Meanwhile, some of those who were previously strong advocates of a neoliberal approach, such as Larry Summers and the Financial Times 's Martin Wolf, have become extremely critical. The wind is in the sails of the critics of neoliberalism; the neoliberals and monetarists are in retreat. In the UK, the media and political worlds are well behind the curve. Few recognise that we are at the end of an era. Old attitudes and assumptions still predominate, whether on the BBC's Today programme, in the rightwing press or the parliamentary Labour party.
As Thomas Piketty has shown, in the absence of countervailing pressures, capitalism naturally gravitates towards increasing inequality. In the period between 1945 and the late 70s, Cold War competition was arguably the biggest such constraint. Since the collapse of the Soviet Union, there have been none. As the popular backlash grows increasingly irresistible, however, such a winner-takes-all regime becomes politically unsustainable.
Large sections of the population in both the US and the UK are now in revolt against their lot, as graphically illustrated by the support for Trump and Sanders in the US and the Brexit vote in the UK. This popular revolt is often described, in a somewhat denigratory and dismissive fashion, as populism. Or, as Francis Fukuyama writes in a recent excellent essay in Foreign Affairs: “‘Populism’ is the label that political elites attach to policies supported by ordinary citizens that they don’t like.” Populism is a movement against the status quo. It represents the beginnings of something new, though it is generally much clearer about what it is against than what it is for. It can be progressive or reactionary, but more usually both.
Jul 04, 2019 | www.theguardian.com
Neoliberal economics and other fairytales about money Politics is not about a struggle over a fixed pot of money, says Mary Mellor, and the best way to end austerity is to reject it as an ideology, says Peter McKenna
Aditya Chakrabortty ( It's reckless. But a Tory cash splurge could win an election , 3 July) is right to point out the hypocrisy of the political right about public expenditure. While progressive proposals for public spending are decried as burdening the hard-pressed taxpayer, the right is happy to use public money to rescue the banks or boost their electoral chances.
As I explain in my book Money: Myths, Truths and Alternatives, neoliberal economics is built on a fairytale about money that distorts our view of how a contemporary public money system operates. It is assumed that public spending depends on extracting money from the market and that money (like gold) is always in short supply. Neither is true. Both the market and the state generate money – the market through bank lending and the state through public spending. Both increase the money supply, while bank loan repayments and taxation reduce it. There is no natural shortage of money – which today mainly exists only as data.
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The case for austerity missed the point. Politics is not about a struggle over a fixed pot of money. What is limited are resources (particularly the environment) and human capacity. How these are best used should be a matter of democratic debate. The allocation of money should depend on the priorities identified. In this the market has no more claim than the public economy to be the source of sustainable human welfare.
Professor Mary Mellor
Newcastle upon Tyne
• Over the years Aditya Chakrabortty has provided us with powerful critiques of austerity. His message now – that EU membership "is the best way to end austerity" – overlooks the fact that the UK was in the EU all that time.
Moreover, the EU's stability and growth pact requires that budget deficits and public debt be pegged below 3% and 60% of GDP respectively.
Such notions are the beating heart of austerity, and the European commission's excessive deficit procedure taken against errant states has almost universally resulted in swingeing austerity programmes. These were approved and monitored by the commission and council, with the UK only taken off the naughty step in 2017 after years of crippling austerity finally reduced the deficit to 2.3% of GDP.
The best way to end austerity – and to sway voters – is to reject austerity as an ideology regardless of remain or leave, and rehabilitate the concept of public investment in a people's economy.
Jul 05, 2019 | www.counterpunch.org
... ... ...
The US today is a global empire. Our country's military, ballooning to some 2.1 million in uniform at a time that there is really no significant war underway. US military spending, greater in constant dollars than at any time since WWII, represents 34% of all global military spending, and the US military budget, depending on how one counts it, is larger than the next largest eight-to-ten countries' military budgets combined.
To show how ridiculously huge the US military is, consider that at $220 billion for fiscal year 2020, the US budget for Veterans Affairs alone (that's the agency that provides assistance of all kinds, including medical, to those who served in the military, not counting career soldiers who receive a pension that is counted separately) this one military budget line item is larger than the entire military budget of China, and is more than three times as large as the entire military budget of Russia, considered by many to be our primary "adversary"!
And remember -- US empire and militarism is and has always been supported by both political parties.
... ... ...
I read that a recent Gallup Organization poll shows a significant drop in the percentage of US Americans who are "extremely proud" of their country. True, 45% still say they are "proud" of America, but normally that is how many say they are "extremely proud" to be Americans. That's a significant fall-off. Even among normally super-patriotic Republicans the percentage of those saying they are "extremely proud" this July 4 of this country was down to 76%, a 10% drop from 2003, and close to the 68% low point reached at one point during the Obama administration.
The main cause of the loss of patriotic ardor appears to be dismay or disgust with the US political system. According to the poll, only 32% of Americans say they are "proud" (forget "extremely proud"!) of America's vaunted political system. In a close second for popular disgust, only 37% said they are "proud" of the US health care system.
So I guess I'm in pretty good company. I won't be oohing and aaahing at the local fireworks display this year. It's basically a glorification of US war-making anyhow, and there's nothing at all to be proud of in that regard, particularly with the US in the midst of a $1.5-trillion upgrade of its nuclear arsenal, threatening war with Iran, pulling out of a Reagan-era treaty banning intermediate-range nuclear missiles, and embarking in a new arms race both in space and in virtually unstoppable hypersonic cruise missiles.
In my view, my country has become the world's leading "rogue" nation, dismissive of all international laws and codes of conduct, actively attacking many countries on its own authority, without the support of UN Security Council resolutions, exonerating war crimes committed by its soldiers, and committed to the first use of nuclear weapons, both as a first strike against major power rivals like Russia and China, and against non-nuclear nations like Iran, and equally dismissive of all efforts, large and small, to respond to the crisis of catastrophic global heating. [
At home, the US legal system has become a supine supporter of virtually unlimited executive power, of unchecked police power, and of repressive actions against the supposedly constitutionally protected free press.
It's tempting to hope that the decline noted by Gallup in the percent of Americans expressing "extreme pride" and even of "pride" in the US, but support for the US among the country's citizens still remains shamefully high in the face of all these negatives.
Anyhow, count me among those who won't be celebrating today's July 4 national holiday.Join the debate on Facebook More articles by: DAVE LINDORFF
Dave Lindorff is a founding member of ThisCantBeHappening! , an online newspaper collective, and is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press).
Jul 05, 2019 | www.unz.com
Miro23 says: July 5, 2019 at 11:09 am GMT 400 Words
This is a very good article on UK politics, but I would have put more emphasis on the background. Where we are today has everything to do with how we got here.
The UK has this basic left/right split (Labour/Conservative) reaching far back into its class based history. Sad to say, but within 5 seconds a British person can determine the class of the person they are dealing with (working/ middle/ upper) and act accordingly – referencing their own social background.
Margaret Thatcher was a lower middle class grocer's daughter who gained a rare place at Oxford University (on her own high intellectual merits), and took on the industrial wreckers of the radical left (Arthur Scargill etc.). She consolidated her power with the failure of the 1984-85 Miner's Strike. She introduced a new kind of Conservatism that was more classless and open to the talents, adopting free market Neoliberalism along with Ronald Reagan. A large section of the aspirational working class went for this (many already had middle class salaries) and wanted that at least their children could join the middle class through the university system.
The key point, is that this happened in the 1980's – 90's. Vast profit possibilities were opening up through digitalization, corporate outsourcing, globalization and the internet. The globalists urgently wanted that money, and had to have political compliance. They found it in Neoliberalism and hijacked both the Conservative Party and the Labour Party, creating "New Labour" (leader Tony Blair) through classless "modernization" following Margaret Thatcher's lead.
The story now, is that the UK public realize that the Globalist/Zionist/SJW/Open Frontiers/ Neoliberal crowd are not their friends . So they (the public) are backtracking fast to find solid ground. In practice this means 1) Leave the Neoliberal/Globalist EU (which has also been hijacked) using Brexit 2) Recover the traditional Socialist Labour Party of working people through Jeremy Corbyn 3) Recover the traditional Conservative Party ( Britain First) through Nigel Farage and his Brexit movement.
Hence the current and growing gulf that is separating the British public from its Zio-Globalist elite + their media propagandists (BBC, Guardian etc.).
Digital Samizdat , says: July 5, 2019 at 12:43 pm GMT@Miro23Parfois1 , says: July 5, 2019 at 1:18 pm GMT
She introduced a new kind of Conservatism that was more classless …
Or just plain anti-working class.
It was actually Thatcher who started the neo-liberal revolution in Britain. To the extent that she refused to finish it, the elites had Tony Blair in the wings waiting to go.Harbinger , says: July 5, 2019 at 1:47 pm GMT
Great blast by Jonathan Cook – I feel as if he has read my thoughts about the political system keeping the proles in an Orwellian state of serfdom for plunder and abuse under the guise of “democracy” and “freedom”. Under this system if anyone steps out of line is indeed sidelined for the “anti-semitic” treatment, demonized, vilified and, virtually hanged and quartered on the public square of the mendacious media.
In the good old days, when there was a militant working class and revolting (!) unionism, we would get together at meetings, organize protests and strikes and confront bosses and officialdom. There was camaraderie, solidarity, loyalty and confident defiance that we were fighting for a better world for ourselves and our children – and also for people less fortunate than us in other countries.
But the ideas of the Chicago School in cohorts with the Frankfurters and Tavistockers were already undermining our hopeful vision of the world while the think tanks at the foundations, councils and institutes were flooding the academies with the doctrines of hardhead uncompromising Capitalism to suck the blood off the proles into anaemic immiseration and apathetic insouciance.
... ... ... .
With the working class defeated and gone, where is the spirit of resistance to spring from? Not from the selfishness of the new generation of smartphone addicts whose world has shrunk to the atomic MEism and who refuse to open their eyes to what is staring in their face: debt slavery, for life. Maybe the French can do it again. Allez Gilets Jaunes!@Miro23 ic get pissed off and vote in the conservatives who then privatise everything. And this game continues on and on. The British public are literally headless chickens running around not knowing what on earth is going on. They’re not interested in getting to the bottom of why society is the way it is. They’re all too comfortable with their mortgages, cars, holidays twice a year, mobile phones, TV shows and football.Miro23 , says: July 5, 2019 at 3:05 pm GMT
When all of this disappears, then certainly, they will start asking questions, but when that time comes they will be utterly powerless to do anything, as a minority in their own land. Greater Israel will be built when that time comes.@Digital Samizdat itants and win – which she did.
No one at the time had much idea about Neoliberalism and none at all about Globalization. This was all in the future.
And it was the British working class who were really cutting their own throats, by wrecking British industry (their future employment), with constant political radicalism and strikes.
Jul 05, 2019 | www.theguardian.com
In the years that followed, the crash, the crisis of the eurozone and the worldwide drop in the price of oil and other commodities combined to put a huge dent in global trade. Since 2012, the IMF reported in its World Economic Outlook for October 2016 , trade was growing at 3% a year – less than half the average of the previous three decades. That month, Martin Wolf argued in a column that globalisation had "lost dynamism", due to a slackening of the world economy, the "exhaustion" of new markets to exploit and a rise in protectionist policies around the world. In an interview earlier this year, Wolf suggested to me that, though he remained convinced globalisation had not been the decisive factor in rising inequality, he had nonetheless not fully foreseen when he was writing Why Globalization Works how "radical the implications" of worsening inequality "might be for the US, and therefore the world".
Among these implications appears to be a rising distrust of the establishment that is blamed for the inequality. "We have a very big political problem in many of our countries," he said. "The elites – the policymaking business and financial elites – are increasingly disliked . You need to make policy which brings people to think again that their societies are run in a decent and civilised way."
That distrust of the establishment has had highly visible political consequences: Farage, Trump, and Le Pen on the right; but also in new parties on the left, such as Spain's Podemos, and curious populist hybrids, such as Italy's Five Star Movement . As in 1997, but to an even greater degree, the volatile political scene reflects public anxiety over "the process that has come to be called 'globalisation'".
If the critics of globalisation could be dismissed before because of their lack of economics training, or ignored because they were in distant countries, or kept out of sight by a wall of police, their sudden political ascendancy in the rich countries of the west cannot be so easily discounted today.
Apr 10, 2018 | www.theguardian.com
Originally from: Seven signs of the neoliberal apocalypse - Van Badham - Opinion - The Guardian
slorter, 27 Apr 2018 01:37bryonyed -> slorter , 27 Apr 2018 01:41
Both neoliberal-driven governments and authoritarian societies share one important factor: They care more about consolidating power in the hands of the political, corporate and financial elite than they do about investing in the future of young people and expanding the benefits of the social contract and common good.
Michael Yates (economist) points out throughout his book 'The Great Inequality', capitalism is devoid of any sense of social responsibility and is driven by an unchecked desire to accumulate capital at all costs. As power becomes global and politics remains local, ruling elites no longer make political concessions to workers or any other group that they either exploit or consider disposable.
At bottom, neoliberals believe in a social hierarchy of "haves" and "have nots". They have taken this corrosive social vision and dressed it up with a "respectable" sounding ideology which all boils down to the cheap labor they depend on to make their fortunes.
The ugly truth is that cheap-labour conservatives just don't like working people. They don't like "bottom up" prosperity, and the reason for it is very simple. "Corporate lords" have a harder time kicking them around.
Once you understand this about the cheap-labor conservatives, the real motivation for their policies makes perfect sense. Remember, cheap-labour conservatives believe in social hierarchy and privilege, so the only prosperity they want is limited to them. They want to see absolutely nothing that benefits those who work for an hourly wage.
You also need to remember that voting the coalition out, which you need to do, will not necessarily give you a neoliberal free zone; Labor needs to shed some the dogma as well.
Yep! The neolib scum hate poor people and have complexes of deservedness.
Jun 28, 2019 | www.moonofalabama.org
How Russia's President Putin Explains The End Of The '[neo]Liberal' Order
Today the Financial Times published a long and wide ranging interview with the President of the Russian Federation Vladimir Putin.
A full transcript is currently available through this link .
The talk is making some waves:
- Putin: Russian president says [neo]liberalism 'obsolete' - BBC
- Vladimir Putin says [neo]liberalism has 'outlived its purpose' - Irish Times
- Russia's Vladimir Putin: [neo]liberalism in Europe is 'obsolete' - NBC News
From the last link:Putin said in an interview with the Financial Times Friday that the "[neo]liberal idea has become obsolete," and referred to Germany's decision to welcome more than one million refugees -- many fleeing savage urban warfare in Syria -- as a "cardinal mistake."
It is only the last part of the very long interview, where Putin indeed speaks of the 'obsolesce' of the '[neo]liberal idea', that seems to be of interest to the media. Most of the interview is in fact about other issues. The media also do not capture how his 'obsolete' argument is ingrained in the worldview Putin developed, and how it reflects in many of his answers.
Here are excerpts that show that the gist of Putin's 'obsolete' argument is not against the '[neo]liberal idea', but against what may be best called 'international (neo-)[liberalism'.
Putin explains why U.S. President Donald Trump was elected:Has anyone ever given a thought to who actually benefited and what benefits were gained from globalisation, the development of which we have been observing and participating in over the past 25 years, since the 1990s?
China has made use of globalisation, in particular, to pull millions of Chinese out of poverty.
What happened in the US, and how did it happen? In the US, the leading US companies -- the companies, their managers, shareholders and partners -- made use of these benefits. [..] The middle class in the US has not benefited from globalisation; it was left out when this pie was divided up.
The Trump team sensed this very keenly and clearly, and they used this in the election campaign. It is where you should look for reasons behind Trump's victory, rather than in any alleged foreign interference.
On Syria:Primarily, this concerns Syria, we have managed to preserve Syrian statehood, no matter what, and we have prevented Libya-style chaos there. And a worst-case scenario would spell out negative consequences for Russia.
I believe that the Syrian people should be free to choose their own future.
When we discussed this matter only recently with the previous US administration, we said, suppose Assad steps down today, what will happen tomorrow?
Your colleague did well to laugh, because the answer we got was very amusing. You cannot even imagine how funny it was. They said, "We don't know." But when you do not know what happens tomorrow, why shoot from the hip today? This may sound primitive, but this is how it is.
On 'western' interventionism and 'democracy promotion':Incidentally, the president of France said recently that the American democratic model differs greatly from the European model. So there are no common democratic standards. And do you, well, not you, but our Western partners, want a region such as Libya to have the same democratic standards as Europe and the US? The region has only monarchies or countries with a system similar to the one that existed in Libya.
But I am sure that, as a historian, you will agree with me at heart. I do not know whether you will publicly agree with this or not, but it is impossible to impose current and viable French or Swiss democratic standards on North African residents who have never lived in conditions of French or Swiss democratic institutions. Impossible, isn't it? And they tried to impose something like that on them. Or they tried to impose something that they had never known or even heard of. All this led to conflict and intertribal discord. In fact, a war continues in Libya.
So why should we do the same in Venezuela? ...
Asked about the turn towards nationalism and more rightwing policies in the U.S. and many European countries, Putin names immigration as the primary problem:What is happening in the West? What is the reason for the Trump phenomenon, as you said, in the US? What is happening in Europe as well? The ruling elites have broken away from the people. The obvious problem is the gap between the interests of the elites and the overwhelming majority of the people .
Of course, we must always bear this in mind. One of the things we must do in Russia is never to forget that the purpose of the operation and existence of any government is to create a stable, normal, safe and predictable life for the people and to work towards a better future.
There is also the so-called [neo]liberal idea, which has outlived its purpose. Our Western partners have admitted that some elements of the [neo]liberal idea, such as multiculturalism, are no longer tenable.
When the migration problem came to a head, many people admitted that the policy of multiculturalism is not effective and that the interests of the core population should be considered. Although those who have run into difficulties because of political problems in their home countries need our assistance as well. That is great, but what about the interests of their own population when the number of migrants heading to Western Europe is not just a handful of people but thousands or hundreds of thousands?
What am I driving at? Those who are concerned about this, ordinary Americans, they look at this and say, Good for [Trump], at least he is doing something, suggesting ideas and looking for a solution.
As for the [neo]liberal idea, its proponents are not doing anything. They say that all is well, that everything is as it should be. But is it? They are sitting in their cosy offices, while those who are facing the problem every day in Texas or Florida are not happy, they will soon have problems of their own. Does anyone think about them?
The same is happening in Europe. I discussed this with many of my colleagues, but nobody has the answer. The say they cannot pursue a hardline policy for various reasons. Why exactly? Just because. We have the law, they say. Well, then change the law!
We have quite a few problems of our own in this sphere as well.
In other words, the situation is not simple in Russia either, but we have started working to improve it. Whereas the [neo]liberal idea presupposes that nothing needs to be done. The migrants can kill, plunder and rape with impunity because their rights as migrants must be protected. What rights are these? Every crime must have its punishment.
So, the [neo]liberal idea has become obsolete. It has come into conflict with the interests of the overwhelming majority of the population. Or take the traditional values. I am not trying to insult anyone, because we have been condemned for our alleged homophobia as it is. But we have no problems with LGBT persons. God forbid, let them live as they wish. But some things do appear excessive to us.
They claim now that children can play five or six gender roles. I cannot even say exactly what genders these are, I have no notion. Let everyone be happy, we have no problem with that. But this must not be allowed to overshadow the culture, traditions and traditional family values of millions of people making up the core population.
While Putin says that [neo]liberalism is 'obsolete' he does not declare it dead. He sees it as part of a spectrum, but says that it should not have a leading role:You know, it seems to me that purely [neo]liberal or purely traditional ideas have never existed. Probably, they did once exist in the history of humankind, but everything very quickly ends in a deadlock if there is no diversity. Everything starts to become extreme one way or another.
Various ideas and various opinions should have a chance to exist and manifest themselves, but at the same time interests of the general public, those millions of people and their lives, should never be forgotten. This is something that should not be overlooked.
Then, it seems to me, we would be able to avoid major political upheavals and troubles. This applies to the [neo]liberal idea as well. It does not mean (I think, this is ceasing to be a dominating factor) that it must be immediately destroyed. This point of view, this position should also be treated with respect.
They cannot simply dictate anything to anyone just like they have been attempting to do over the recent decades. Diktat can be seen everywhere: both in the media and in real life. It is deemed unbecoming even to mention some topics. But why?
For this reason, I am not a fan of quickly shutting, tying, closing, disbanding everything, arresting everybody or dispersing everybody. Of course, not. The [neo]liberal idea cannot be destroyed either; it has the right to exist and it should even be supported in some things. But you should not think that it has the right to be the absolute dominating factor. That is the point. Please.
There is much more in the interview - about Russia's relations with China, North Korea, the Skripal incident, the Russian economy, orthodoxy and the [neo]liberal attack on the Catholic church, multilateralism, arms control and the G-20 summit happening today.
But most '[neo]liberal' media will only point to the 'obsolete' part and condemn Putin for his rallying against immigration. They will paint him as being in an alt-right corner. But even the Dalai Lama, held up as an icon by many [neo]liberals, says that "Europe is for Europeans" and that immigrants should go back to their own countries.
Moreover, as Leonid Bershidsky points out , Putin himself is, with regards to the economy and immigration, a staunch [neo]liberal:Putin's cultural conservatism is consistent and sincere.
On immigration, however, Putin is, in practice, more [neo]liberal than most European leaders. He has consistently resisted calls to impose visa requirements on Central Asian countries, an important source of migrant labor. Given Russia's shrinking working-age population and shortage of manual workers, Putin isn't about to stem that flow, even though Central Asians are Muslims – the kind of immigrants Merkel's opponents, including Trump, distrust and fear the most.
What Putin is aiming at, says Bershidsky, is the larger picture:[W]hat Putin believes has outlived its usefulness isn't the [neo]liberal approach to migration or gender, nor is it [neo]liberal economics – even though Russia has, in recent months, seen something of a shift toward central planning. It is the [neo]liberal world order. Putin wants to keep any talk of values out of international politics and forge pragmatic relationships based on specific interests.
Putin's drive to put global politics on a more transactional basis isn't easy to defeat; it's a siren song, and the anti-immigrant, culturally conservative rhetoric is merely part of the music.
There is in my view no 'siren-song' there and nothing that has to be defeated. It is just that Putin is more willing to listen to the people than most of the western wannabe 'elite'.
The people's interest is simply not served well by globalization, [neo]liberal internationalism and interventionism. A transactional approach to international policies, with respect for basic human decency, is in almost every case better for them.
Politicians who want the people's votes should listen to them, and to Vladimir Putin.
Posted by b on June 28, 2019 at 01:50 PM | Permalink
pretzelattack , Jun 28, 2019 2:05:48 PM | 1he makes a lot of sense on neo]liberalism. i guess this makes me a Russian agent.ROBERT SYKES , Jun 28, 2019 2:15:18 PM | 2It is hard to exaggerate Putin's accomplishments. He almost single-handedly saved Russia from the chaos of the Yeltsin era and near collapse. He has reestablished Russia as a major power. In the face of the American world rampage, he has helped stabilize MENA. By merging Russia's Eurasian Union with China's OBOR, he has helped to set Eurasia on a road to peaceful economic development. He has even managed to get China, India, and Pakistan talking to one another and cooperating in a variety of Eurasian projects.Barovsky , Jun 28, 2019 2:16:21 PM | 3
I doubt he has more than 10 years left as a Russian leader, and maybe not even that. When he finally passes, he will be remembered as another Churchill or Bismarck.Hmmm... Putin says the problem is 'multi-culturalism', 'migrants'? What kind of bullshit is this?Alexander P , Jun 28, 2019 2:17:47 PM | 4
Putin doesn't mention that the migrant crisis was caused by Western resource wars, in Syria, Libya and elsewhere. That neoliberalism's impact on the poor countries has led to the vast exodus into Europe and N. America.
I have a feeling that Putin is playing the 'RT game', targeting those disaffected people, who have, in turn been the target of racist, islamaphobic propaganda by Western states, states that for obvious reasons (self-incrimination) won't state the real reasons for the exodus.The page on [neo]liberalism in the classic sense the way it was envisioned in the late 18th and 19th century has long been passed. [neo]liberalism as in nurturing the human soul and intellect and allowing each individual to draw on their qualities and contribute to society with their fullest potential has been supplanted by material and physical liberties alone (Gender, Sexuality, Free Trade, Free Migration aka Free Movement of Slave Labor etc). What today is called [neo]liberalism, which I like to equate with neo-[neo]liberalism and social 'progressivism', are both parts of post-modernism, a societal model that is falling and failing under its own weight of hubris and inconsistencies.robjira , Jun 28, 2019 2:20:55 PM | 5
The 'Do as thou wilt' mindset pushed on the people by the elites is deliberate with the only end goal of creating their 'ideal' world. A world not based on morality, spirituality and absolute truths, but relativism, materialism, loss of basic notions such as gender, family, belonging, in short loss of identity and purpose for mankind to obtain ever greater control over the masses. People are beginning to notice it, however, even if only subconsciously and start to push back against it. Putin knows this, and that is what he is laying out in his interview.Joe Nobody , Jun 28, 2019 2:23:07 PM | 6It is just that Putin is more willing to listen to the people than most of the western wannabe 'elite'.Right on target, b; many thanks again. I'll be sure to read the entire transcript.karlof1 , Jun 28, 2019 2:27:19 PM | 7"They claim now that children can play five or six gender roles. I cannot even say exactly what genders these are, I have no notion. Let everyone be happy, we have no problem with that. But this must not be allowed to overshadow the culture, traditions and traditional family values of millions of people making up the core population.'
It has become la la land in the West in regards to gender...if a person wants to be gay, be gay, but let's not force everyone else to pretend reality is not reality..nature choose (dichotomy) for you to be male or female, sucks if that doesn't match your preferences but better luck next life...accept the reality you are in and let's not force everyone one else to pander to your delusions..
'Sex change' is biologically impossible," said McHugh. "People who undergo sex-reassignment surgery do not change from men to women or vice versa. Rather, they become feminized men or masculinized women. Claiming that this is civil-rights matter and encouraging surgical intervention is in reality to collaborate with and promote a mental disorder."
https://newspunch.com/john-hopkins-transgenderism-mental-illness/I'm reading the Kremlin's transcript I linked to at the Gabbard thread where I posted a very short excerpt. I continue to read it but stopped to post another very short excerpt IMO is very important:pretzelattack , Jun 28, 2019 2:27:47 PM | 8
"One of the things we must do in Russia is never to forget that the purpose of the operation and existence of any government is to create a stable, normal, safe and predictable life for the people and to work towards a better future ." [My Emphasis]
Back to reading!@ 3--remind me who was fighting the west in syria, again?vk , Jun 28, 2019 2:30:47 PM | 9Zachary Smith , Jun 28, 2019 2:40:29 PM | 10Here are excerpts that show that the gist of Putin's 'obsolete' argument is not against the '[neo]liberal idea', but against what may be best called 'international (neo-)liberalism'.
Just a matter of academic rigour: liberalism is extinct; neoliberalism is literally the "new liberalism", it's successor doctrine. Therefore, when we speak of "liberalism" after 1945, we're automatically referring to neoliberalism.
neoliberalism was created at Mont Pelerin in the 1930s, and its founding narrative states that everything that happened between/since the death of liberalism (1914-1918) and their own hegemony (1974-75) was an abortion of History and should've never happened. Hence the name "neoliberalism": the new liberalism (adapted to the system of fiat currency instead of the gold standard); the revival of liberalism; the return of liberalism (the [neo]liberals).
It's also important to highlight that neoliberalism is not an ideology, but a doctrine (which encompass mainly policies, but may also encompass ideals). It is wrong, for example, to compare socialism with neoliberalism (socialism as anti-neoliberalism): socialism is a scientific theory, and, as a social theory, encompasses a new socioeconomic system, a new set of ideologies, a new set of cultures and a new set of political doctrines.
Neoliberalism, therefore, is just one aspect with which the capitalist elites engage against socialism historically (in the doctrinal "front").Generic question: How many of the 2020 candidates for US President could hold up their end of an interview with such knowledge and style?Alan McLemore , Jun 28, 2019 2:44:48 PM | 11
Personally I was impressed by Putin's bluntness in stating Merkel had made a "cardinal mistake" when she opened the borders to the hundreds of thousands of illegals. And also this:And we set ourselves a goal, a task -- which, I am certain, will be achieved -- to adjust pensions by a percentage that is above the inflation rate.
Compare that to the deliberate US policy if doing the exact opposite.Can you imagine Trump writing like this? Or Obama, for that matter? Or Bush the Dimmer, or Clinton, or Bush the Spook, or Reagan, or Carter...Hell, you'd have to go back to JFK to find this sort of skill with language and deep analysis. And maybe not then. "They" say you get the leaders you deserve. In that case the Russians have been nice and we Americans have been very, very naughty.dh , Jun 28, 2019 2:45:31 PM | 12So now we wait for MSM 'analysts' to accuse Putin of disrupting the status quo and fomenting revolution.lgfocus , Jun 28, 2019 2:47:56 PM | 13Barovsky @3Sally Snyder , Jun 28, 2019 2:48:51 PM | 14
Putin has recognized the influence of our "regime change" wars on the immigrant problem in Europe. He addressed it forcefully in his UN General Assembly speech in 2015 where he asks NATO "Do you know what you've done?" with regards to creating the immigration problems in Europe. Watch here https://youtu.be/q13yzl6k6w0.
From Putin's 2007 Munich speech to this 2015 UN speech and many interviews along the way, I've learned to pay attention to what Putin says. He seems to have an extremely good handle on world events and where they are leading.If we really want to know who is interfering in the world's politics, particularly in Russia, we need look no further than this:JDL , Jun 28, 2019 2:53:21 PM | 15
American-style bought-and-paid-for democracy is not what the world needs.In the west our governments call Mr Putin a thug, a gangster. But, I've never seen any of our politicians sit down and frankly and comprehensively lay out there views, goals, thoughts and musings. To be a good leader or politician you have do have vision, but in the west here i just see talking heads and soundbites, no soul.wagelaborer , Jun 28, 2019 3:00:50 PM | 16Oh, yeah, the "[neo]liberals" are indignant over his pointing out that mass migration causes social disruption.
The neoliberal economic plan is to suck the wealth out of the working class and funnel it up to the top 10%, especially the 1%. How to keep the working class from noticing the theft?
How about divide and conquer? That seems to work. Take the native working class and divide it any way that works in that society. In the US, traditionally, it was race, but they added sex a couple of decades ago, then opened the doors t