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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.|
Mar 06, 2012 | discussion.theguardian.com
murielbelcher , 6 Mar 2012 09:40Friedrich von Hayek, one of the creed's most revered economic gurus, spent his productive years railing against government old age pension and medical insurance schemes. When he became old and infirm, he signed on for both social security and medicare.
Love it. When push comes to shove all those ideologies and beliefs crumble into the dust of practical needs. Another individual who cloaked the self-interest of the rich and powerful into some kind of spurious ideology.
George wrote a rather good article about Von Hayek a few years ago I seem to remember.
May 30, 2019 | www.theguardian.comBill Clinton and Tony Blair represented neoliberalism with a human face but remained beholden to an expired ideology. Photograph: Mark Lennihan/AP W hat kind of economic system is most conducive to human wellbeing? That question has come to define the current era, because, after 40 years of neoliberalism in the United States and other advanced economies, we know what doesn't work.
The neoliberal experiment – lower taxes on the rich, deregulation of labour and product markets, financialisation, and globalisation – has been a spectacular failure. Growth is lower than it was in the quarter-century after the second world war, and most of it has accrued to the very top of the income scale. After decades of stagnant or even falling incomes for those below them, neoliberalism must be pronounced dead and buried.
Vying to succeed it are at least three major political alternatives: far-right nationalism, centre-left reformism and the progressive left (with the centre-right representing the neoliberal failure). And yet, with the exception of the progressive left, these alternatives remain beholden to some form of the ideology that has (or should have) expired.
The centre-left, for example, represents neoliberalism with a human face. Its goal is to bring the policies of former US president Bill Clinton and former British prime minister Tony Blair into the 21st century, making only slight revisions to the prevailing modes of financialisation and globalisation.
Meanwhile, the nationalist right disowns globalisation, blaming migrants and foreigners for all of today's problems. Yet as Donald Trump's presidency has shown, it is no less committed – at least in its American variant – to tax cuts for the rich, deregulation and shrinking or eliminating social programmes.
By contrast, the third camp advocates what I call progressive capitalism , which prescribes a radically different economic agenda, based on four priorities. The first is to restore the balance between markets, the state and civil society. Slow economic growth, rising inequality, financial instability and environmental degradation are problems born of the market, and thus cannot and will not be overcome by the market on its own. Governments have a duty to limit and shape markets through environmental, health, occupational safety and other types of regulation. It is also the government's job to do what the market cannot or will not do, such as actively investing in basic research, technology, education and the health of its constituents.
The second priority is to recognise that the "wealth of nations" is the result of scientific inquiry – learning about the world around us – and social organisation that allows large groups of people to work together for the common good. Markets still have a crucial role to play in facilitating social cooperation, but they serve this purpose only if they are governed by the rule of law and subject to democratic checks. Otherwise, individuals can get rich by exploiting others, extracting wealth through rent-seeking rather than creating wealth through genuine ingenuity. Many of today's wealthy took the exploitation route to get where they are. They have been well served by Trump's policies, which have encouraged rent-seeking while destroying the underlying sources of wealth creation. Progressive capitalism seeks to do precisely the opposite.
There is no magic bullet that can reverse the damage done by decades of neoliberalism
This brings us to the third priority: addressing the growing problem of concentrated market power . By exploiting information advantages, buying up potential competitors and creating entry barriers, dominant firms are able to engage in large-scale rent-seeking to the detriment of everyone else. The rise in corporate market power, combined with the decline in workers' bargaining power, goes a long way toward explaining why inequality is so high and growth so tepid. Unless government takes a more active role than neoliberalism prescribes, these problems will likely become much worse, owing to advances in robotisation and artificial intelligence.
The fourth key item on the progressive agenda is to sever the link between economic power and political influence. Economic power and political influence are mutually reinforcing and self-perpetuating, especially where, as in the US, wealthy individuals and corporations may spend without limit in elections. As the US moves ever closer to a fundamentally undemocratic system of "one dollar, one vote", the system of checks and balances so necessary for democracy likely cannot hold: nothing will be able to constrain the power of the wealthy. This is not just a moral and political problem: economies with less inequality actually perform better . Progressive-capitalist reforms thus have to begin by curtailing the influence of money in politics and reducing wealth inequality.
There is no magic bullet that can reverse the damage done by decades of neoliberalism. But a comprehensive agenda along the lines sketched above absolutely can. Much will depend on whether reformers are as resolute in combating problems like excessive market power and inequality as the private sector is in creating them.
A comprehensive agenda must focus on education, research and the other true sources of wealth. It must protect the environment and fight climate change with the same vigilance as the Green New Dealers in the US and Extinction Rebellion in the United Kingdom. And it must provide public programmes to ensure that no citizen is denied the basic requisites of a decent life. These include economic security, access to work and a living wage, health care and adequate housing, a secure retirement, and a quality education for one's children.
This agenda is eminently affordable; in fact, we cannot afford not to enact it. The alternatives offered by nationalists and neoliberals would guarantee more stagnation, inequality, environmental degradation and political acrimony, potentially leading to outcomes we do not even want to imagine.
Progressive capitalism is not an oxymoron. Rather, it is the most viable and vibrant alternative to an ideology that has clearly failed. As such, it represents the best chance we have of escaping our current economic and political malaise.
Joseph E Stiglitz is a Nobel laureate in economics, university professor at Columbia University and chief economist at the Roosevelt Institute. Project Syndicate
Mar 06, 2012 | discussion.theguardian.com
JohannesL , Mar 6, 2012
It never stops to amaze me how the American Republican Right claims to be Christian. Have you noticed that they NEVER quote the words of Jesus Christ? I don't blame them, Republicanism and true Christianity are mutually exclusive. There is nothing for them to quote. Sharing your wealth? Giving to the poor? Egalitarianism? Loving your neighbour? The Good Samaritan?
Dirty words all. Best to pretend that Christianity is about extreme right wing economic policy (and fascist social mores), even though it is the opposite.
If Jesus came to the US today, he would not like Republicans and they would not like him. Santorum, Palin, Limbaugh etc. would strap him to the electric chair and pull the lever if they could, no doubt.
And Tea Partiers like Ayn Rand? The most anti-Christian and anti-American lunatic you can find? The corporate agenda and Wall Street interests trump everything else. No news there.
acorn7817 -> PeaceGrenade , 6 Mar 2012 06:21
The most bizarre aspect of the rights infatuation with Ayn Rand is that she was an ardent Atheist who's beliefs are diametrically opposite to those of Jesus & the Bible.
A lot of these people describe themselves as Christian, makes you wonder which part of Jesus' message they loved more, the part that said the poor should rot without help, or the part where he said violence was justified and the chasing of wealth is to be lauded.
richmanchester -> anindefinitearticle , 6 Mar 2012 05:40"the only way you're gonna be able to sleep at night (and go to heaven in the afterlife) is to believe that the system has some moral justification based on the laws of nature"
I think this is one of the drivers in the shift from Catholicism to Protestanism, especially in Northern Europe.
For Medieval Catholics everyone was where God had put them, so the rich were rich and the poor poor as part of Gods plan, and anyone trying to change it was going against God.
Which is handy if you are a Baron or Bishop living the high life surrounded my thousands of starving peasants (having armed retainers also helped).
Come the industrial revolution and the rise of the business and trade classes that's not so appealing, so now God rewards the virtuous and hard working, who naturally rise to the top.
May 10, 2019 | www.nytimes.com
On the ragged streets of the shantytown across the road, where stinking outhouses sit alongside shacks fashioned from rusted sheets of tin, families have surrendered hopes that sewage lines will ever reach them.
They do not struggle to fashion an explanation for their declining fortunes: Since taking office more than three years ago, President Mauricio Macri has broken with the budget-busting populism that has dominated Argentina for much of the past century, embracing the grim arithmetic of economic orthodoxy.
Mr. Macri has slashed subsidies for electricity, fuel and transportation, causing prices to skyrocket, and recently prompting Ms. Genovesi, 48, to cut off her gas service, rendering her stove lifeless. Like most of her neighbors, she illegally taps into the power lines that run along the rutted dirt streets.
"It's a neoliberal government," she says. "It's a government that does not favor the people."
The tribulations playing out under the disintegrating roofs of the poor are a predictable dimension of Mr. Macri's turn away from left-wing populism. He vowed to shrink Argentina's monumental deficits by diminishing the largess of the state. The trouble is that Argentines have yet to collect on the other element the president promised: the economic revival that was supposed to follow the pain.
Mr. Macri's supporters heralded his 2015 election as a miraculous outbreak of normalcy in a country with a well-earned reputation for histrionics. He would cease the reckless spending that had brought Argentina infamy for defaulting on its debts eight times. Sober-minded austerity would win the trust of international financiers, bringing investment that would yield jobs and fresh opportunities.
But as Mr. Macri seeks re-election this year, Argentines increasingly lament that they are absorbing all strife and no progress. Even businesses that have benefited from his reforms complain that he has botched the execution, leaving the nation to confront the same concoction of misery that has plagued it for decades. The economy is contracting. Inflation is running above 50 percent, and joblessness is stuck above 9 percent.
Poverty afflicts a third of the population, and the figure is climbing.
Far beyond this country of 44 million people, Mr. Macri's tenure is testing ideas that will shape economic policy in an age of recrimination over widening inequality. His presidency was supposed to offer an escape from the wreckage of profligate spending while laying down an alternative path for countries grappling with the worldwide rise of populism. Now, his presidency threatens to become a gateway back to populism. The Argentine economy is contracting. Inflation is running above 50 percent, and joblessness is stuck above 9 percent. Poverty afflicts a third of the population. Credit Sarah Pabst for The New York Times
As the October election approaches, Mr. Macri is contending with the growing prospect of a challenge from the president he succeeded, Cristina Fernández de Kirchner, who faces a series of criminal indictments for corruption . Her unbridled spending helped deliver the crisis that Mr. Macri inherited. Her return would resonate as a rebuke of his market-oriented reforms while potentially yanking Argentina back to its accustomed preserve: left-wing populism, in uncomfortable proximity to insolvency.
The Argentine peso lost half of its value against the dollar last year, prompting the central bank to lift interest rates to a commerce-suffocating level above 60 percent. Argentina was forced to secure a $57 billion rescue from the International Monetary Fund , a profound indignity given that the fund is widely despised here for the austerity it imposed in the late 1990s, turning an economic downturn into a depression.
For Mr. Macri, time does not appear to be in abundant supply. The spending cuts he delivered hit the populace immediately. The promised benefits of his reforms -- a stable currency, tamer inflation, fresh investment and jobs -- could take years to materialize, leaving Argentines angry and yearning for the past.
In much of South America, left-wing governments have taken power in recent decades as an angry corrective to dogmatic prescriptions from Washington, where the Treasury and the I.M.F. have focused on the confidence of global investors as the key to development.
Left-wing populism has aimed to redistribute the gains from the wealthy to everyone else. It has aided the poor, while generating its own woes -- corruption and depression in Brazil , runaway inflation and financial ruin in Argentina. In Venezuela, uninhibited spending has turned the country with the world's largest proven oil reserves into a land where children starve .
Mr. Macri sold his administration as an evolved form of governance for these times, a crucial dose of market forces tempered by social programs.
In the most generous reading, the medicine has yet to take effect. But in the view of beleaguered Argentines, the country has merely slipped back into the rut that has framed national life for as long as most people can remember.
"We live patching things up," said Roberto Nicoli, 62, who runs a silverware company outside the capital, Buenos Aires. "We never fix things. I always say, 'Whenever we start doing better, I will start getting ready for the next crisis.'"
... ... ...
In the beginning, there was Juan Domingo Perón, the charismatic Army general who was president from 1946 to 1955, and then again from 1973 to 1974. He employed an authoritarian hand and muscular state power to champion the poor. He and his wife, Eva Duarte -- widely known by her nickname, Evita -- would dominate political life long after they died, inspiring politicians across the ideological spectrum to claim their mantle.
Among the most ardent Peronists were Néstor Kirchner, the president from 2003 to 2007, and his wife, Cristina Fernández de Kirchner, who took office in 2007, remaining until Mr. Macri was elected in 2015.
Their version of Peronism -- what became known as Kirchnerism -- was decidedly left-wing, disdaining global trade as a malevolent force. They expanded cash grants to the poor and imposed taxes on farm exports in a bid to keep Argentine food prices low.
As the country's farmers tell it, Kirchnerism is just a fancy term for the confiscation of their wealth and the scattering of the spoils to the unproductive masses. They point to Ms. Kirchner's 35 percent tax on soybean exports.
"We had a saying," Mr. Tropini says. "'For every three trucks that went to the port, one was for Cristina Kirchner.'"
reduction in export taxes.
"You could breathe finally," Mr. Tropini, the farmer, says.
He was free of the Kirchners, yet stuck with nature. Floods in 2016 wiped out more than half of his crops. A drought last year wreaked even more havoc.
"This harvest, this year," he says, "is a gift from God."
But if the heavens are now cooperating, and if the people running Buenos Aires represent change, Mr. Tropini is critical of Mr. Macri's failure to overcome the economic crisis.
A weaker currency makes Argentine soybeans more competitive, but it also increases the cost of the diesel fuel Mr. Tropini needs to run his machinery. High interest rates make it impossible for him to buy another combine, which would allow him to expand his farm.
In September, faced with a plunge in government revenues, Mr. Macri reinstated some export taxes .
... ... ...
What went wrong?
... ... ...
In the first years of Mr. Macri's administration, the government lifted controls on the value of the peso while relaxing export taxes. The masters of international finance delivered a surge of investment. The economy expanded by nearly 3 percent in 2017, and then accelerated in the first months of last year.
But as investors grew wary of Argentina's deficits, they fled, sending the peso plunging and inflation soaring. As the rout continued last year, the central bank mounted a futile effort to support the currency, selling its stash of dollars to try to halt the peso's descent. As the reserves dwindled, investors absorbed the spectacle of a government failing to restore order. The exodus of money intensified, and another potential default loomed, leading a chastened Mr. Macri to accept a rescue from the dreaded IMF.
Administration officials described the unraveling as akin to a natural disaster: unforeseeable and unavoidable. The drought hurt agriculture. Money was flowing out of developing countries as the Federal Reserve continued to lift interest rates in the United States, making the American dollar a more attractive investment.
But the impact of the Fed's tightening had been widely anticipated. Economists fault the government for mishaps and complacency that left the country especially vulnerable.
.... ... ...
Among the most consequential errors was the government's decision to include Argentina's central bank in a December 2017 announcement that it was raising its inflation target. The markets took that as a signal that the government was surrendering its war on inflation while opting for a traditional gambit: printing money rather than cutting spending.
... ... ...
The government insists that better days are ahead. The spending cuts have dropped the budget deficit to a manageable 3 percent of annual economic output. Argentina is again integrated into the global economy.
"We haven't improved, but the foundations of the economy and society are much healthier," said Miguel Braun, secretary of economic policy at the Treasury Ministry. "Argentina is in a better place to generate a couple of decades of growth."
... ... ...
Their television flashes dire warnings, like "Danger of Hyper Inflation." Throughout the neighborhood, people decry the sense that they have been forsaken by the government.
Trucks used to come to castrate male dogs to control the packs of feral animals running loose. Not anymore. Health programs for children are less accessible than they were before, they said.
Daisy Quiroz, 71, a retired maid, lives in a house that regularly floods in the rainy season.
"When our president Cristina was here, they sent people to help us," she says. "Now, if there's problems, nobody helps us. Poor people feel abandoned."
... ... ...
Daniel Politi contributed reporting from Buenos Aires. Peter S. Goodman is a London-based European economics correspondent. He was previously a national economic correspondent in New York. He has also worked at The Washington Post as a China correspondent, and was global editor in chief of the International Business Times. @ petersgoodman
Apr 11, 2019 | discussion.theguardian.com
twiglette , 11 Apr 2019 05:13Communism and neoliberalism were never as far apart as people imagined. Two sides of a coin. A theological dispute.
Mar 06, 2012 | discussion.theguardian.com
macfeegal , 6 Mar 2012 03:56Another very informative article from one of the few writers with any sense of having a 'finger on the pulse.'
It's sad that it's taken over 30 years for the real shaping influences behind the current system to be identified and discussed outside the boundaries of a few university conferences.
The Right have been absolutely brilliant at media control and obfuscation. Their gurus have been camouflaged and the whole process of influencing Reagan and Thatcher's governments from the late 1970's has escaped exactly the kind of scrutiny that George gives Rand.
We might also investigate the influence of John Nash's (A Beautiful Mind) 'Gameplay' experiments in a similar fashion along with the economic gurus who followed Hayek so slavishly.
It has been known for years that the neo liberal project was designed not just to under mine democracy and convert people into passive cloned market junkies, but to put an end to the whole of the Enlightenment Project, which perhaps naively saw human development,. growth and other human qualities totally savaged and defeated by this poisonous evil, which emulates all the worst aspects of Fascism without the flags and theatre.
Sadly, this is not a 'this is happening' phenomenon; it's a 'this has happened phenomenon.' The taint and viral effect of its impact on uk and usa political structures has already caused major damage. All three major political parties in the uk have for 30 years subscribed to its tenets though they were no doubt not presented in such a flagrant form as Rand's writing.
How problematic is it to now look at the polity and rescue it from such a major ideological shift? Certainly, the major parties cannot shuck off the cape of their key beliefs after promoting Right wing ideologies for so long, and the traditional Left is no more.
However, it is good to see some pithy journalism that goes to the heart of the matter - those of us who have been pleading for less x factor celebrity worshipping of politicians can at least feel as though this shifts the spectrum to real and significant issues that have affected the lives of everyone for so long.
Spot on George; one of your best.
Jun 23, 2019 | discussion.theguardian.com
Kikinaskald , 6 Mar 2012 14:14
I wonder how many would continue to worship at the shrine of Ayn Rand if they knew that towards the end of her life she signed on for both Medicare and social security.
In case nobody mentioned this book before, which is relevant to the theme:
The Submerged State by Suzanne Mettler
From the Amazon book description:
These submerged policies, Mettler shows, obscure the role of government and exaggerate that of the market. As a result, citizens are unaware not only of the benefits they receive, but of the massive advantages given to powerful interests, such as insurance companies and the financial industry. Neither do they realize that the policies of the submerged state shower their largest benefits on the most affluent Americans, exacerbating inequality.
Apr 11, 2019 | discussion.theguardian.com
Galluses , 11 Apr 2019 07:26What has been very noticeable about the development of bureaucracy in the public and private spheres over the last 40 years (since Thatcher govt of 79) has been the way systems are designed now to place responsibility and culpability on the workers delivering the services - Teachers, Nurses, social workers, etc. While those making the policies, passing the laws, overseeing the regulations- viz. the people 'at the top', now no longer take the rap when something goes wrong- they may be the Captain of their particular ship, but the responsibility now rests with the man sweeping the decks. Instead they are covered by tying up in knots those teachers etc. having to fill in endless check lists and reports, which have as much use as clicking 'yes' one has understood those long legal terms provided by software companies.... yet are legally binding. So how the hell do we get out of this mess? By us as individuals uniting through unions or whatever and saying NO. No to your dumb educational directives, No to your cruel welfare policies, No to your stupid NHS mismanagement.... there would be a lot of No's but eventually we could say collectively 'Yes I did the right thing'.promisingproper -> Dianeandguy , 11 Apr 2019 08:00Staff distress? Cleaning ( in another county) was privatised to make profit in Thatcher times.The work of two cleaners became the task of one person. Extra duties were loaded on -serving meals and drinks, fetching blankets and equipment. Wages dropped by a small degree -but important when we ere earning, say, £65 a week. Indemnity/insurance against catching infections was withdrawn. Firstly owned by Jeyes and then sold on to Rentokill ,obviously good for shareholders. A new 'manager' appeared with their own office.fairshares -> rjb04tony , 11 Apr 2019 07:17'The left wing dialogue about neoliberalism used to be that it was the Wild West and that anything goes. Now apparently it's a machine of mass control.'
It is the Wild West and anything goes for the corporate entities, and a machine of control of the masses. Hence the wish of neoliberals to remove legislation that protects workers and consumers.
Apr 10, 2019 | discussion.theguardian.com
mirotto -> ID7696310, 10 Apr 2019 17:26No-one.
They're businesses, therefore by definition efficient and responsible. Haha.
The assessment and monitoring are for the little people - teachers and children, as they can't be trusted.
Apr 10, 2019 | discussion.theguardian.com
penelo , 10 Apr 2019 20:43Quantomania -- this is the word I have been needing for some time now! So much better than having to say "obsession with quantity" all the time.
Would it be useful to add quantism and quantist too? Maybe even quantistic and quantistical ?
Apr 10, 2019 | discussion.theguardian.com
izaakwalton , 11 Apr 2019 00:55As someone who thinks von Mises and Hayek made invaluable contributions to economics I was surprised to see such a ringing endorsement for Mises's ideas in the Guardian:
"Public-service workers are now subjected to a panoptical regime of monitoring and assessment, using the benchmarks von Mises rightly warned were inapplicable and absurd."
That is spot on. Yes, Mises thought that workers should no more be allowed to corner a market in labour than companies should be allowed to create monopolies in products, and this is certainly a point where he can be criticized. Using the name "neoliberal" to cover
such very different ideas as Milton's and Hayek's though is absurd - they had completely opposite ideas about vast government spending to recover from recession. Try looking up John James Cowperthwaite, who oversaw post-war development in Hong Kong by getting government out of the way.
He forbade the use of any performance targets of the type Blair brought in, and refused to compile GDP statistics, thinking the government would game them.
Both von Mises and Hayek would be horrified at the money printing of modern central banks, especially since 2008. To ascribe modern policy to their ideas is simply nonsense - they did not (as far as I know) ever suggest central control of interest rates , stock buying by central banks or saving a bank that has failed through fraud and greed.
If "neoliberalism" is our present dominant ideology, then please do not use the word to describe their work.
Apr 10, 2019 | discussion.theguardian.com
marshwren , 10 Apr 2019 22:29As a matter of semantics, neo-liberalism delivered on the promise of freedom...for capitalists to be free of ethical accountability, social responsibility, and government regulation and taxes...
Jun 23, 2019 | discussion.theguardian.com
economicalternative , 11 Apr 2019 20:42Finally. A writer who can talk about neoliberalism as NOT being a retro version of classical laissez faire liberalism. It is about imposing "The Market" as the sole arbiter of Truth on us all.
Only the 'Market' knows what is true in life - no need for 'democracy' or 'education'.
Neoliberals believe - unlike classical liberals with their view of people as rational individuals acting in their own self-interest - people are inherently 'unreliable', stupid.
Only entrepreneurs - those close to the market - can know 'the truth' about anything.
To succeed we all need to take our cues in life from what the market tells us. Neoliberalism is not about a 'small state'. The state is repurposed to impose the 'all knowing' market on everyone and everything. That is neoliberalism's political project. It is ultimately not about 'economics'.
Jun 23, 2019 | discussion.theguardian.com
HolyInsurgent -> GeorgeMonbiot , 5 Mar 2012 22:44
But the world didn't work like that, and the people who didn't fit had to be shoved under the wheel of history.
This is a remarkably similar summation of Rand's worldview of entire classes of people: if you are poor, you deserve it. Expect nothing from the State to raise you from the cycle of poverty. The State is evil and should be eliminated. No evil can come from the Business Culture (or more accurately the Business Cult). The U.S. Republican worldview summed up right there.
The only sane response to Ayn Rand is the creation of the Human Values Project , where creating a better world for all is its manifesto and mandate.
Many thanks for the article. The Right keep erecting her on a pedestal and saying her ideas are infallible like the Pope. She can't be pulled down off that pedestal enough times.
Apr 12, 2019 | discussion.theguardian.com
wariquari -> Pushers11 , 12 Apr 2019 16:56Your claim is not that people decide rights via participation in political process (social contract), it is that there are universal natural individual rights that cannot be violated based in... something; there is no negotiability like there is with the social contract. Your apparantly foundationless rights cannot be changed by political process - so where do they come from?Pushers11 -> wariquari , 12 Apr 2019 10:44
Your claim is that some quality of people grants immutable rights, not that rights are decided by people. Are you of the strain that thinks we should be allowed to starve our kids (Rothbard)? Or that non-capitalist societies are fair game to be killed and enslaved, to have thier land put to 'better' use (Locke)? Perhaps that latter one underlies the feeling that it would be easy to up sticks and move to some undefined piece of land.
You have changed the nice things you listed now, you said maternity leave/pay, weekends, etc. Those were granted by collective potitical action, not the generosity of the capitalists. If Jeff Bezos could hire 1st graders he obviously would.
So you having to leave because you don't wamt to participate in tax paying is coercion, but people having to leave because they don't want to live under Libertarianism isn't?
Incidentally, which countries at the top of the PISA or OECD rankings do not have massive state education?
As for Hong Kong, its entire existence is predicated on extreme acts of aggression by the British. The opium trade and its profits started the ball rolling after an aggressive war. The Hong Kong authority also owns most of the land, leasing it; they therefore have massive influence on who gets what and what they do with it - more so than most other nations.
"As you are free to leave, no individual state institution is is forcing you to participate under pain of violence. If the fact you have no place to go that does not take tax means that you are coerced, then someone who cannot live but by participation in free-market capitalism would also be coerced into participation"
I think we won't agree on this because we have a fundamentally different understanding of coercion. The way I see it, I should not have a leave the place I live in to not have coercive action taking away my money. I should be able to say, no thanks. It is the difference between my willingly purchasing something and a mugger taking my money at gunpoint. The State is the gun. Always has been, always will be. And yes, there is a place for the gun in society - defence - but not in extorting money from peaceful people.
And people can and do live without being part of the capitalist system. They can live off the land. They can set up communes. They can use a barter system if they want. Capitalism just gives people more opportunities, but they can opt out if they want. Or move to a place that doesn't have capitalism, like many places in Africa or South America or Cuba. Funny who must people try to leave those places though. Millions do not flock there. They do the other way round.
"In your opinion."
Yes, true. In my opinion. But I have backed that opinion up with a well reasoned argument for my position. It didn't just come out of thin air. It comes from recognising the nature of government is force, violence and coercion. Again, it is the gun in society. And in my opinion, I think it is wrong, immoral and will always lead to bad outcomes to use the gun to solve societies more tricky problems. And we can clearly see the bad results of public / State education, socialised healthcare, welfare, government involvement in the economy, etc, etc, etc. All do badly.
"Did I? I didn't sign up before birth to participate, and I have no other options but to participate or die."
You have other options, as previously mentioned. Live off the land, move to a non-capitalist country, set up a commune, etc.
"Still unsure upon what these rights are based. The mere fact that people can reason does not necessarily instill or ground right."
Where else can they come from? If you say "government". Well when does government get its power and decide on your rights? From the people that make up government. So we are back to people again.
"You tell us elsewhere that we don't really have capitalism, the state and other actors dominate and fiddle etc. Now you clam capitalism has provided all these nice things* - pick one."
No. It is not a case of picking one. It is not an "either / or" situation. Economic freedom and economic oppression exist on a sliding scale. You have more free economies, like the US (especially prior to 1913) and you have less free economies, like the USSR or Cuba. The parts of freedom we have, give us the good stuff, gives us innovation and allows society to grow richer and lift more people out of poverty. The more bad stuff that gets involved, the less we have, the more society stagnates. The USSR was a lot poorer and dirtier (environmentally) and had a lot more famine and waste because it was highly centrally controlled.
"So it had nothing to do with quasi-British authorities selling narcotics to mainland China then?"
Not much. There may have been some of that but nowhere near enough to explain the explosion of wealth in HK.
Mar 06, 2012 | discussion.theguardian.com
PSmd , 6 Mar 2012 09:35@silverwhistle
We ARE social animals. Which is why I laugh when I hear right-wing opinions compared to the laws of the jungle. As far as I can gather, in the jungle, there are no such things as property laws, inheritance, land enclosure, or indeed money! Humanity's development is as socialised societies, with surpluses, consent, and so on.
And there has never been free-market capitalism. A misnomer if ever there was one.
Jun 23, 2019 | discussion.theguardian.com
Pinkie123 , 12 Apr 2019 03:23The other point to be made is that the return of fundamentalist nationalism is arguably a radicalized form of neoliberalism. If 'free markets' of enterprising individuals have been tested to destruction, then capitalism is unable to articulate an ideology with which to legitimise itself.
Therefore, neoliberal hegemony can only be perpetuated with authoritarian, nationalist ideologies and an order of market feudalism.
In other words, neoliberalism's authoritarian orientations, previously effaced beneath discourses of egalitarian free-enterprise, become overt.
The market is no longer an enabler of private enterprise, but something more like a medieval religion, conferring ultimate authority on a demagogue.
Individual entrepreneurs collectivise into a 'people' serving a market which has become synonymous with nationhood. A corporate state emerges, free of the regulatory fetters of democracy.
The final restriction on the market - democracy itself - is removed. There then is no separate market and state, just a totalitarian market state.
Pinkie123 -> economicalternative , 12 Apr 2019 02:57Yes, the EU is an ordoliberal institution - the state imposing rules on the market from without. Thus, it is not the chief danger. The takeover of 5G, and therefore our entire economy and industry, by Huawei - now that would be a loss of state sovereignty. But because Huawei is nominally a corporation, people do not think about is a form of governmental bureaucracy, but if powerful enough that is exactly what it is.economicalternative -> Pinkie123 , 11 Apr 2019 21:33Pinkie123: So good to read your understandings of neoliberalism. The political project is the imposition of the all seeing all knowing 'market' on all aspects of human life. This version of the market is an 'information processor'. Speaking of the different idea of the laissez-faire version of market/non market areas and the function of the night watchman state are you aware there are different neoliberalisms? The EU for example runs on the version called 'ordoliberalism'. I understand that this still sees some areas of society as separate from 'the market'?economicalternative -> ADamnSmith2016 , 11 Apr 2019 21:01ADamnSmith: Philip Mirowski has discussed this 'under the radar' aspect of neoliberalism. How to impose 'the market' on human affairs - best not to be to explicit about what you are doing. Only recently has some knowledge about the actual neoliberal project been appearing. Most people think of neoliberalism as 'making the rich richer' - just a ramped up version of capitalism. That's how the left has thought of it and they have been ineffective in stopping its implementation.subtropics , 11 Apr 2019 13:51Neoliberalism allows with impunity pesticide businesses to apply high risk toxic pesticides everywhere seriously affecting the health of children, everyone as well as poisoning the biosphere and all its biodiversity. This freedom has gone far too far and is totally unacceptable and these chemicals should be banished immediately.Pinkie123 , 11 Apr 2019 13:27The left have been entirely wrong to believe that neoliberalism is a mobilisation of anarchic, 'free' markets. It never was so. Only a few more acute thinkers on the left (Jacques Ranciere, Foucault, Deleuze and, more recently, Mark Fisher, Wendy Brown, Will Davies and David Graeber) have understood neoliberalism to be a techno-economic order of control, requiring a state apparatus to enforce wholly artificial directives.
Also, the work of recent critics of data markets such as Shoshana Zuboff has shown capitalism to be evolving into a totalitarian system of control through cybernetic data aggregation.
Only in theory is neoliberalism a form of laissez-faire. Neoliberalism is not a case of the state saying, as it were: 'OK everyone, we'll impose some very broad legal parameters, so we'll make sure the police will turn up if someone breaks into your house; but otherwise we'll hang back and let you do what you want'.
Hayek is perfectly clear that a strong state is required to force people to act according to market logic. If left to their own devices, they might collectivise, think up dangerous utopian ideologies, and the next thing you know there would be socialism.
This the paradox of neoliberalism as an intellectual critique of government: a socialist state can only be prohibited with an equally strong state. That is, neoliberals are not opposed to a state as such, but to a specifically centrally-planned state based on principles of social justice - a state which, to Hayek's mind, could only end in t totalitarianism.
Because concepts of social justice are expressed in language, neoliberals are suspicious of linguistic concepts, regarding them as politically dangerous. Their preference has always been for numbers. Hence, market bureaucracy aims for the quantification of all values - translating the entirety of social reality into metrics, data, objectively measurable price signals. Numbers are safe. The laws of numbers never change. Numbers do not lead to revolutions. Hence, all the audit, performance review and tick-boxing that has been enforced into public institutions serves to render them forever subservient to numerical (market) logic. However, because social institutions are not measurable, attempts to make them so become increasingly mystical and absurd. Administrators manage data that has no relation to reality. Quantitatively unmeasurable things - like happiness or success - are measured, with absurd results.
It should be understood (and I speak above all as a critic of neoliberalism) that neoliberal ideology is not merely a system of class power, but an entire metaphysic, a way of understanding the world that has an emotional hold over people. For any ideology to universalize itself, it must be based on some very powerful ideas. Hayek and Von Mises were Jewish fugitives of Nazism, living through the worst horrors of twentieth-century totalitarianism. There are passages of Hayek's that describe a world operating according to the rules of a benign abstract system that make it sound rather lovely. To understand neoliberalism, we must see that it has an appeal.
However, there is no perfect order of price signals. People do not simply act according to economic self-interest. Therefore, neoliberalism is a utopian political project like any other, requiring the brute power of the state to enforce ideological tenets. With tragic irony, the neoliberal order eventually becomes not dissimilar to the totalitarian regimes that Hayek railed against.
Apr 11, 2019 | discussion.theguardian.com
twiglette -> apacheman , 11 Apr 2019 05:19"Liberal" originally meant the freedom to trade and do business. Before liberalism trade was controlled by cartels, guilds and gifted by prerogative. The freedom to trade is not the root cause of our problems. The drift to monopoly and the legal enforcement of it is new and should be resisted. But the freedom to do business is a freedom for us all.
Apr 11, 2019 | discussion.theguardian.com
mi Griffin , 11 Apr 2019 01:152 simple points that epitomize neo liberalism.
1. Hayek's book 'The Road to Serfdom' uses an erroneous metaphor. He argues that if we allow gov regulation, services and spending to continue then we will end up serfs. However, serfs are basically the indentured or slave labourers of private citizens and landowners not of the state. Only in a system of private capital can there be serfs. Neo liberalism creates serfs not a public system.
2. According to Hayek all regulation on business should be eliminated and only labour should be regulated to make it cheap and contain it so that private investors can have their returns guaranteed. Hence the purpose of the state is to pass laws to suppress workers.
These two things illustrate neo-liberalism. Deception and repression of labour.
Apr 10, 2019 | discussion.theguardian.com
1000100101 -> sejong , 10 Apr 2019 17:53Neoliberalism/'free enterprise' is techno-feudalism.
Apr 11, 2019 | discussion.theguardian.com
Brightdayler -> fakeamoonlanding, 11 Apr 2019 03:15Neoliberalism is not an ideology in its practical application. It is a business model for structuring the economy for rent seeking or wealth extraction: turning everything into a cash cow to be milked until it's dry and then move on to the next one.Brightdayler, 11 Apr 2019 03:13I agree, although a few points need to be added.
First, neoliberalism, to those who understand how finance works (no mainstream economist, then) was never an economic theory, but rather a business model: essentially it describes how to structure an economy for rent seeking.
Michael Hudson describes it as "pro-finance". His definition of austerity, which is part and parcel of the neoliberal business model, is also worth quoting: "austerity is what a good economic policy looks like to a creditor [rentier]"; in other words, it has nothing to do with the economically meaningless notion of good housekeeping (state finances are radically different from household finances).
Second, the freedom that Adam Smith talked about was freedom for the real economy from rent seeking, from wealth extraction - freedom, in modern parlance, from the neoliberal business model.
fakeamoonlanding -> rjb04tony , 11 Apr 2019 03:04I think you are confusing the state with the ideology. Neoliberalism is an ideology that has become embedded in the state. Of course it is the state that privatises public services to private firms. But the ideology behind that policy is what George Monbiot is writing about.
I work for the NHS myself. Take for example, the policy of foundation trusts bidding to run services hundreds of miles from their bases, etc. It may be state policy, but it is a neoliberal nonsense. You would find the NHS littered with bureaucracy that would not be there if the neoliberal ideology of trying to foster "competition" had not become a state policy.
zootsuitbeatnick , 11 Apr 2019 01:58"Neoliberalism promised freedom – instead it delivers stifling control"
The term "neoliberal" is misleading. Neoliberals put capital above people. Neoliberals are the next-worst thing to neoconservatives. That said, why would anybody trust a pols promise?
Apr 11, 2019 | discussion.theguardian.com
JohnS58 , 11 Apr 2019 06:15Only the greedy, selfish, well off, egotistical and share holders believe that Public Services should, could and would benefit from privatisation and deregulation.
Education and Health for example are (in theory) a universal right in the UK. As numbers in the population rise and demographics change so do costs ie delivery of the service becomes more expensive.As market force logic is introduced it also becomes less responsive - hence people not able to get the right drugs and treatment and challenging and challenged young people being denied an education that is vital for them in increasing numbers.
Meanwhile - as Public Services are devalued and denuded in this system the private sector becomes increasingly wealthy at the top while its workers become poorer and less powerful at the bottom.
With the introduction of Tory austerity which punishes the latter to the benefit of the former there is no surprise that this system does not work and has provided a platform for the unscrupulous greedy and corrupt to exploit Brexit and produce conditions which will take 'Neoliberalism' to where logic suggests it would always go - with the powerful rich protected minority exerting their power over an increasingly poor and powerless majority.
Apr 10, 2019 | discussion.theguardian.com
hartebeest , 10 Apr 2019 18:42Back in the Thatcher/Reagan years there were at people around who genuinely believed in the superiority of the market, or at least, made the effort to set out an intellectual case for it.
Now we're in a different era. After 2008, hardly anyone really believes in neoliberal ideas anymore, not to the point that they'd openly make the case for them anyway. But while different visions have appeared to some extent on both left and right, most of those in positions of power and influence have so internalised Thatcher's 'there is no alternative' that it's beyond their political horizons to treat any alternatives which do emerge as serious propositions, let alone come up with their own.
So neoliberalism stumbles on almost as a reflex action. Ben Fine calls it a 'zombie' but I think the better analogy is cannibalism. Unlike the privatisations of the 80s and 90s there's barely any pretence these days that new sell-offs are anything more than simply part of a quest to find new avenues for profit-making in an economy with tons of liquid capital but not enough places to profitability put it. Because structurally speaking most of the economy is tapped out.
Privatising public services at this point is just a way to asset strip and/or funnel public revenue streams to a private sector which has been stuck in neoliberal short-term, low skill, low productivity, low wage, high debt mode for so long that it has lost the ability to grow. So now it is eating itself, or at least eating the structures which hold it up and allow it to survive.
Jun 16, 2019 | www.theamericanconservative.com
The evidence suggests that foreign policymakers do not seek insight from scholars, but rather support for what they already want to do.
As Desch quotes a World War II U.S. Navy anthropologist, "the administrator uses social science the way the drunk uses a lamppost, for support rather than illumination." Scholars' disinclination to be used in this way helps explain more of the distance.
Jun 22, 2019 | www.zerohedge.comIt's the weekend, which means the trade war between the US and China moved to the front page of the local propaganda media (in both the US and China). And while Trump has yet to slam Beijing, focusing this morning on the all time high in the market instead, China has been busy and in an editorial in the state-run People's Daily, Beijing has warned that China has "the strength and patience to withstand the trade war, and will fight to the end if the U.S. administration persists."
Echoing what China's notorious twitter mouthpiece Hu Xijin said yesterday, the editorial said that just days ahead of the much anticipated G-20 summit in Osaka where Trump and Xi are set to meet, " the U.S. must drop all tariffs imposed on China if it wants to negotiate on trade, and only an equal dialogue can resolve the issue and lead to a win-win", according to Bloomberg.
The communist party's official paper also said the US had failed to take into account the interests of its own people, and they are paying higher costs due to the trade dispute. "Wielding a big stick of tariffs" also disregards the condition of the U.S. economy and the international economic order, according to the editorial.
Beijing's official warning to the US ended as follows: if the U.S. chooses to talk, "then it must show some good faith, take account of key concerns from both sides and cancel all tariffs."
And just to prove that China isn't a paper tiger whose threats will be confined to the local newspapers, Reuters reported that overnight China's controversial telecom giant, Huawei, filed a civil lawsuit against the US Commerce Department over the mishandling of telecommunications equipment seized by American officials, demanding its release.
In an almost absurd reversal, the company whose entire existence can be traced to stealing and reverse-engineering foreign technology and trampling over corporate ethics , the complaint alleges that the US government took possession of hardware, including an ethernet switch and computer server, which was transported from China to an independent laboratory in California for testing and certification back in 2017.
However, the equipment was not shipped back to China. It was "purportedly" seized en route and is currently sitting in Alaska, as US officials wanted to investigate whether the shipment required a special license . Such requests are usually processed within 45 days, but nearly two years have already passed since then.
"The equipment, to the best of HT USA's knowledge, remains in a bureaucratic limbo in an Alaskan warehouse," Huawei said in its lawsuit, which was filed on Friday in federal court in Washington.
Huawei contends that the equipment did not require a license because it did not fall into a controlled category and because it was made outside the United States and was being returned to the same country from which it came.
The company is not seeking any financial compensation and is not challenging the seizure itself, but is sending a message to Washington, saying "post-seizure failures to act are unlawful", in effect charging the Trump admin with doing precisely what it, itself has been accused of. Huawei wants to force the Commerce Department to decide whether an export license is really necessary and, if not, release the withheld equipment.
The lawsuit comes amid a bitter row between two world's largest economies, and Washington's crackdown on Huawei. In May, the Trump administration added Huawei to the entity list, barring it from buying needed U.S. parts and components without U.S. government approval. The US alleges that Huawei could be spying for the Chinese government, a claim which the company has repeatedly denied.
Huawei CFO Meng Wanzhou, daughter of the company's founder, has been detained in Canada since December on a U.S. warrant. She is fighting extradition on charges that she misled global banks about Huawei's relationship with a company operating in Iran.
Of course, Huawei is not the only Chinese tech company that the White House decided to put on its trade blacklist. On Friday, five Chinese organizations – supercomputer maker Sugon, three its affiliates, and the Wuxi Jiangnan Institute of Computing Technology – were added to entity list on the grounds that their activities are allegedly contrary to US national security and foreign policy interests.
The fresh US blacklisting comes ahead of crucial talks between US President Donald Trump and Chinese President Xi Jinping in Osaka, Japan, which are intended to ease tensions between the two sides. Still, don't expect a breakthrough: as Goldman's trade deal odds index found last week... the probability of a breakthrough between the two nations is roughly one in five.
Jun 20, 2019 | dissidentvoice.org
austerity has been a central component of state policy at every level of government in the U.S. and in Europe for the last four decades. In Europe, as the consequences of neoliberal policies imposed on workers began to be felt and understood, the result was intense opposition. However, in the U.S. the unevenness of how austerity policies were being applied, in particular the elimination or reduction in social services that were perceived to be primarily directed at racialized workers, political opposition was slow to materialize.
Today, however, relatively privileged workers who were silent as the neoliberal "Washington consensus" was imposed on the laboring classes in the global South -- through draconian structural adjustment policies that result in severe cutbacks in state expenditures for education, healthcare, state employment and other vital needs -- have now come to understand that the neoliberal program of labor discipline and intensified extraction of value from workers, did not spare them.
The deregulation of capital, privatization of state functions -- from road construction to prisons, the dramatic reduction in state spending that results in cuts in state supported social services and goods like housing and access to reproductive services for the poor -- represent the politics of austerity and the role of the neoliberal state.
This materialist analysis is vitally important for understanding the dialectical relationship between the general plight of workers in the U.S. and the bipartisan collaboration to raid the Federal budget and to reduce social spending in order to increase spending on the military. This perspective is also important for understanding the imposition of those policies as a violation of the fundamental human rights of workers, the poor and the oppressed.
For the neoliberal state, the concept of human rights does not exist.
As I have called to attention before , a monumental rip-off is about to take place once again. Both the Democrats and Republicans are united in their commitment to continue to feed the U.S. war machine with dollars extracted -- to the tune of 750 billion dollars -- from the working class and transferred to the pockets of the military/industrial complex.
The only point of debate is now whether or not the Pentagon will get the full 750 billion or around 733 billion. But whether it is 750 billion or 733 billion, the one sector that is not part of this debate is the public. The attention of the public has been adroitly diverted by the absurd reality show that is Russiagate. But this week, even though the budget debate has been disappeared by corporate media, Congress is set to begin debate on aspects of the budget and specifically on the National Defense Authorization Act (NDAA).
Raising the alarm on this issue is especially critical at this moment. As tensions escalate in the Persian Gulf, the corporate media is once again abdicating its public responsibility to bring unbiased, objective information to the public and instead is helping to generate support for war with Iran.
The Democrats, who have led the way with anti-Iran policies over the last few decades, will be under enormous pressure not to appear to be against enhancing military preparedness and are likely to find a way to give Trump and the Pentagon everything they want.
Support for Human Rights and Support for Empire is an Irreconcilable Contradiction
The assumption of post-war capitalist order was that the state would be an instrument to blunt the more contradictory aspects of capitalism. It would regulate the private sector, provide social welfare support to the most marginal elements of working class, and create conditions for full employment. This was the Keynesian logic and approach that informed liberal state policies beginning in the 1930s.
The idea of reforming human rights fits neatly into that paradigm.
As seen, a state's legitimacy was based on the extent to which it recognized, protected and fulfilled the human rights of all its citizens and residents. Those rights included not only the right to information, assembly, speech and to participation in the national political life of the nation but also the right to food, water, healthcare, education, employment, substantial social security throughout life, and not just as a senior citizen.
The counterrevolutionary program of the late 60s and 70s, especially the turn to neoliberalism which began in the 70s, would reject this paradigm and redefine the role of the state. The obligation of the state to recognize, protect and fulfill human rights was eliminated from the role of the state under neoliberalism.
Today the consequences of four decades of neoliberalism in the global South and now in the cosmopolitan North have created a crisis of legitimacy that has made state policies more dependent on force and militarism than in any other time, including the civil war and the turmoil of the 1930s.
The ideological glue provided by the ability of capitalism to deliver the goods to enough of the population which guaranteed loyalty and support has been severely weakened by four decades of stagnant wages, increasing debt, a shrinking middle-class, obscene economic inequality and never-ending wars that have been disproportionately shouldered by the working class.
Today, contrary to the claims of capitalism to guarantee the human right to a living wage ensuring "an existence worthy of human dignity," the average worker is making, adjusted for inflation, less than in 1973; i.e., some 46 years-ago. 140 million are either poor or have low-income; 80% living paycheck to paycheck; 34 million are still without health insurance; 40 million live in "official poverty;" and more in unofficial poverty as measured by alternative supplemental poverty (SPM). And more than half of those over 55 years-old have no retirement funds other than Social Security.
In a report, Philp Alston , the UN's special rapporteur on extreme poverty and human rights, points out that : the US is one of the world's wealthiest countries. It spends more on national defense than China, Saudi Arabia, Russia, the United Kingdom, India, France and Japan combined.
However, that choice in public expenditures must be seen in comparison to the other factors he lays out:
- US infant mortality rates in 2013 were the highest in the developed world.
- Americans can expect to live shorter and sicker lives, compared to people living in any other rich democracy, and the "health gap" between the US and its peer countries continues to grow.
- US inequality levels are far higher than those in most European countries
- In terms of access to water and sanitation the US ranks 36th in the world.
- The youth poverty rate in the United States is the highest across the OECD with one quarter of youth living in poverty compared to less than 14% across the OECD.
For African Americans in particular, neoliberalism has meant, jobs lost, hollowed out communities as industries relocated first to the South and then to Mexico and China, the disappearance of affordable housing, schools and hospital closings, infant and maternal mortality at global South levels, and mass incarceration as the unskilled, low-wage Black labor has become economically redundant.
This is the backdrop and context for the budget "debate" and Trump's call to cut spendings to Departments of Housing and Urban Development, Education, Labor, Health and Human Services, the Environmental Protection Agency, and even the State Department.
The U.S. could find 6 trillion dollars for war since 2003 and 16 trillion to bail out the banks after the financial sector crashed the economy, but it can't find money to secure the human rights of the people.
This is the one-sided class war that we find ourselves in; a war with real deaths and slower, systematic structural violence. Neither the Democrats nor the Republicans can be depended on to secure our rights or protect the world from the U.S. atrocities. That responsibility falls on the people who reside at the center of the Empire to not only struggle for ourselves but to put a brake on the Empire's ability to spread death and destruction across the planet.
Ajamu Baraka is a board member with Cooperation Jackson, the national organizer of the Black Alliance for Peace and was the 2016 candidate for vice president on the Green Party ticket. He is an editor and contributing columnist for the Black Agenda Report and contributing columnist for Counterpunch. He can be reached at www.AjamuBaraka.com Read other articles by Ajamu , or visit Ajamu's website .
Jan 08, 2018 | theweek.com
From the late 1980s to 2016, neoliberal ideas held hegemonic sway among the Democratic elite. But the economy created by this ideology -- and the ensuing crises -- is a major reason why Clinton lost to Trump and the party is completely out of power today. This obvious failure has provided an ideological opening that the American left has been eager to fill.
Yet even the left-wing is divided about the best way forward. Should it follow Elizabeth Warren's lead and promise a return to the trust-busting ways of the early 20th century? Or should it emulate the more sweeping, Nordic-style politics of Bernie Sanders? Or perhaps the Democratic Socialists of America are right and something even more extreme is needed.
... ... ...
The Democrats swept to power in a wave election in 2008, as the economy entered free fall. They had every opportunity to abandon neoliberalism and return to the kind of New Deal policy that the Great Recession called for -- and they blew it.
... ... ...
Incredibly, the Democrats responded by doubling down on neoliberalism. Over and over again during the Obama years, the party elite proved itself overly sympathetic to the concerns of the market.
Instead of attacking the concentrated wealth and power of big finance, Democrats took the neoliberal route and passed a blizzard of complicated rules in the Dodd-Frank financial reform package that attempted to reduce specific financial sector risk. Many of those provisions were quite worthy, to be sure, but after the crisis the biggest banks are even larger than they were before the crisis and financial sector profits quickly bounced back to their previous levels.
The Obama administration also proved itself largely incapable of enforcing laws against white-collar crime. Department of Justice careerists like Eric Holder and Lanny Breuer were terrified that anything more than gentle wrist-slap fines would undermine the stability of the financial sector . As a result, despite massive fraud carried out during the housing bubble and the ensuing crash , no major bank and none of their top executives were convicted of anything.
Most damning of all, neoliberalism under Obama turned in the worst economic performance since the 1930s . Despite the fact that the 2008 crash left obvious excess capacity, there was no catch-up growth -- on the contrary, growth was about two-thirds the 1945-2007 average, with no sign of speeding up on the horizon. Even 10 years after the start of the recession, there is every sign that the economy is still depressed.
So despite the confident predictions of the Chicago School, the political economy created by neoliberalism turned out to be identical to 1920s laissez-faire economics in every important respect. The United States is once again a country which functions mostly on behalf of a tiny capitalist elite. It has the same extreme inequality, the same bloated, crisis-prone financial sector, the same corruption, and the same political backlash to the status quo and rising extremist factions.
... ... ...
Jun 19, 2019 | www.nakedcapitalism.com
Yves here. This post describes how the forces driving the US suicide surge started well before the Trump era, but explains how Trump has not only refused to acknowledge the problem, but has made matters worse.
However, it's not as if the Democrats are embracing this issue either.
BY Rajan Menon, the Anne and Bernard Spitzer Professor of International Relations at the Powell School, City College of New York, and Senior Research Fellow at Columbia University's Saltzman Institute of War and Peace Studies. His latest book is The Conceit of Humanitarian Intervention Originally published at TomDispatch .
We hear a lot about suicide when celebrities like Anthony Bourdain and Kate Spade die by their own hand. Otherwise, it seldom makes the headlines. That's odd given the magnitude of the problem.
In 2017, 47,173 Americans killed themselves. In that single year, in other words, the suicide count was nearly seven times greater than the number of American soldiers killed in the Afghanistan and Iraq wars between 2001 and 2018.
A suicide occurs in the United States roughly once every 12 minutes . What's more, after decades of decline, the rate of self-inflicted deaths per 100,000 people annually -- the suicide rate -- has been increasing sharply since the late 1990s. Suicides now claim two-and-a-half times as many lives in this country as do homicides , even though the murder rate gets so much more attention.
In other words, we're talking about a national epidemic of self-inflicted deaths.
Anyone who has lost a close relative or friend to suicide or has worked on a suicide hotline (as I have) knows that statistics transform the individual, the personal, and indeed the mysterious aspects of that violent act -- Why this person? Why now? Why in this manner? -- into depersonalized abstractions. Still, to grasp how serious the suicide epidemic has become, numbers are a necessity.
According to a 2018 Centers for Disease Control study , between 1999 and 2016, the suicide rate increased in every state in the union except Nevada, which already had a remarkably high rate. In 30 states, it jumped by 25% or more; in 17, by at least a third. Nationally, it increased 33% . In some states the upsurge was far higher: North Dakota (57.6%), New Hampshire (48.3%), Kansas (45%), Idaho (43%).
Alas, the news only gets grimmer.
Since 2008 , suicide has ranked 10th among the causes of death in this country. For Americans between the ages of 10 and 34, however, it comes in second; for those between 35 and 45, fourth. The United States also has the ninth-highest rate in the 38-country Organization for Economic Cooperation and Development. Globally , it ranks 27th.
More importantly, the trend in the United States doesn't align with what's happening elsewhere in the developed world. The World Health Organization, for instance, reports that Great Britain, Canada, and China all have notably lower suicide rates than the U.S., as do all but six countries in the European Union. (Japan's is only slightly lower.)
World Bank statistics show that, worldwide, the suicide rate fell from 12.8 per 100,000 in 2000 to 10.6 in 2016. It's been falling in China , Japan (where it has declined steadily for nearly a decade and is at its lowest point in 37 years), most of Europe, and even countries like South Korea and Russia that have a significantly higher suicide rate than the United States. In Russia, for instance, it has dropped by nearly 26% from a high point of 42 per 100,000 in 1994 to 31 in 2019.
We know a fair amount about the patterns of suicide in the United States. In 2017, the rate was highest for men between the ages of 45 and 64 (30 per 100,000) and those 75 and older (39.7 per 100,000).
The rates in rural counties are almost double those in the most urbanized ones, which is why states like Idaho, Kansas, New Hampshire, and North Dakota sit atop the suicide list. Furthermore, a far higher percentage of people in rural states own guns than in cities and suburbs, leading to a higher rate of suicide involving firearms, the means used in half of all such acts in this country.
There are gender-based differences as well. From 1999 to 2017, the rate for men was substantially higher than for women -- almost four-and-a-half times higher in the first of those years, slightly more than three-and-a-half times in the last.
Education is also a factor. The suicide rate is lowest among individuals with college degrees. Those who, at best, completed high school are, by comparison, twice as likely to kill themselves. Suicide rates also tend to be lower among people in higher-income brackets.
The Economics of Stress
This surge in the suicide rate has taken place in years during which the working class has experienced greater economic hardship and psychological stress. Increased competition from abroad and outsourcing, the results of globalization, have contributed to job loss, particularly in economic sectors like manufacturing, steel, and mining that had long been mainstays of employment for such workers. The jobs still available often paid less and provided fewer benefits.
Technological change, including computerization, robotics, and the coming of artificial intelligence, has similarly begun to displace labor in significant ways, leaving Americans without college degrees, especially those 50 and older, in far more difficult straits when it comes to finding new jobs that pay well. The lack of anything resembling an industrial policy of a sort that exists in Europe has made these dislocations even more painful for American workers, while a sharp decline in private-sector union membership -- down from nearly 17% in 1983 to 6.4% today -- has reduced their ability to press for higher wages through collective bargaining.
Furthermore, the inflation-adjusted median wage has barely budged over the last four decades (even as CEO salaries have soared). And a decline in worker productivity doesn't explain it: between 1973 and 2017 productivity increased by 77%, while a worker's average hourly wage only rose by 12.4%. Wage stagnation has made it harder for working-class Americans to get by, let alone have a lifestyle comparable to that of their parents or grandparents.
The gap in earnings between those at the top and bottom of American society has also increased -- a lot. Since 1979, the wages of Americans in the 10th percentile increased by a pitiful 1.2%. Those in the 50th percentile did a bit better, making a gain of 6%. By contrast, those in the 90th percentile increased by 34.3% and those near the peak of the wage pyramid -- the top 1% and especially the rarefied 0.1% -- made far more substantial gains.
And mind you, we're just talking about wages, not other forms of income like large stock dividends, expensive homes, or eyepopping inheritances. The share of net national wealth held by the richest 0.1% increased from 10% in the 1980s to 20% in 2016. By contrast, the share of the bottom 90% shrank in those same decades from about 35% to 20%. As for the top 1%, by 2016 its share had increased to almost 39% .
The precise relationship between economic inequality and suicide rates remains unclear, and suicide certainly can't simply be reduced to wealth disparities or financial stress. Still, strikingly, in contrast to the United States, suicide rates are noticeably lower and have been declining in Western European countries where income inequalities are far less pronounced, publicly funded healthcare is regarded as a right (not demonized as a pathway to serfdom), social safety nets far more extensive, and apprenticeships and worker retraining programs more widespread.
Evidence from the United States , Brazil , Japan , and Sweden does indicate that, as income inequality increases, so does the suicide rate. If so, the good news is that progressive economic policies -- should Democrats ever retake the White House and the Senate -- could make a positive difference. A study based on state-by-state variations in the U.S. found that simply boosting the minimum wage and Earned Income Tax Credit by 10% appreciably reduces the suicide rate among people without college degrees.
The Race Enigma
One aspect of the suicide epidemic is puzzling. Though whites have fared far better economically (and in many other ways) than African Americans, their suicide rate is significantly higher . It increased from 11.3 per 100,000 in 2000 to 15.85 per 100,000 in 2017; for African Americans in those years the rates were 5.52 per 100,000 and 6.61 per 100,000. Black men are 10 times more likely to be homicide victims than white men, but the latter are two-and-half times more likely to kill themselves.
The higher suicide rate among whites as well as among people with only a high school diploma highlights suicide's disproportionate effect on working-class whites. This segment of the population also accounts for a disproportionate share of what economists Anne Case and Angus Deaton have labeled " deaths of despair " -- those caused by suicides plus opioid overdoses and liver diseases linked to alcohol abuse. Though it's hard to offer a complete explanation for this, economic hardship and its ripple effects do appear to matter.
According to a study by the St. Louis Federal Reserve , the white working class accounted for 45% of all income earned in the United States in 1990, but only 27% in 2016. In those same years, its share of national wealth plummeted, from 45% to 22%. And as inflation-adjusted wages have decreased for men without college degrees, many white workers seem to have lost hope of success of any sort. Paradoxically, the sense of failure and the accompanying stress may be greater for white workers precisely because they traditionally were much better off economically than their African American and Hispanic counterparts.
In addition, the fraying of communities knit together by employment in once-robust factories and mines has increased social isolation among them, and the evidence that it -- along with opioid addiction and alcohol abuse -- increases the risk of suicide is strong . On top of that, a significantly higher proportion of whites than blacks and Hispanics own firearms, and suicide rates are markedly higher in states where gun ownership is more widespread.
Trump's Faux Populism
The large increase in suicide within the white working class began a couple of decades before Donald Trump's election. Still, it's reasonable to ask what he's tried to do about it, particularly since votes from these Americans helped propel him to the White House. In 2016, he received 64% of the votes of whites without college degrees; Hillary Clinton, only 28%. Nationwide, he beat Clinton in counties where deaths of despair rose significantly between 2000 and 2015.
White workers will remain crucial to Trump's chances of winning in 2020. Yet while he has spoken about, and initiated steps aimed at reducing, the high suicide rate among veterans , his speeches and tweets have never highlighted the national suicide epidemic or its inordinate impact on white workers. More importantly, to the extent that economic despair contributes to their high suicide rate, his policies will only make matters worse.
The real benefits from the December 2017 Tax Cuts and Jobs Act championed by the president and congressional Republicans flowed to those on the top steps of the economic ladder. By 2027, when the Act's provisions will run out, the wealthiest Americans are expected to have captured 81.8% of the gains. And that's not counting the windfall they received from recent changes in taxes on inheritances. Trump and the GOP doubled the annual amount exempt from estate taxes -- wealth bequeathed to heirs -- through 2025 from $5.6 million per individual to $11.2 million (or $22.4 million per couple). And who benefits most from this act of generosity? Not workers, that's for sure, but every household with an estate worth $22 million or more will.
As for job retraining provided by the Workforce Innovation and Opportunity Act, the president proposed cutting that program by 40% in his 2019 budget, later settling for keeping it at 2017 levels. Future cuts seem in the cards as long as Trump is in the White House. The Congressional Budget Office projects that his tax cuts alone will produce even bigger budget deficits in the years to come. (The shortfall last year was $779 billion and it is expected to reach $1 trillion by 2020.) Inevitably, the president and congressional Republicans will then demand additional reductions in spending for social programs.
This is all the more likely because Trump and those Republicans also slashed corporate taxes from 35% to 21% -- an estimated $1.4 trillion in savings for corporations over the next decade. And unlike the income tax cut, the corporate tax has no end date . The president assured his base that the big bucks those companies had stashed abroad would start flowing home and produce a wave of job creation -- all without adding to the deficit. As it happens, however, most of that repatriated cash has been used for corporate stock buy-backs, which totaled more than $800 billion last year. That, in turn, boosted share prices, but didn't exactly rain money down on workers. No surprise, of course, since the wealthiest 10% of Americans own at least 84% of all stocks and the bottom 60% have less than 2% of them.
And the president's corporate tax cut hasn't produced the tsunami of job-generating investments he predicted either. Indeed, in its aftermath, more than 80% of American companies stated that their plans for investment and hiring hadn't changed. As a result, the monthly increase in jobs has proven unremarkable compared to President Obama's second term, when the economic recovery that Trump largely inherited began. Yes, the economy did grow 2.3% in 2017 and 2.9% in 2018 (though not 3.1% as the president claimed). There wasn't, however, any "unprecedented economic boom -- a boom that has rarely been seen before" as he insisted in this year's State of the Union Address .
Anyway, what matters for workers struggling to get by is growth in real wages, and there's nothing to celebrate on that front: between 2017 and mid-2018 they actually declined by 1.63% for white workers and 2.5% for African Americans, while they rose for Hispanics by a measly 0.37%. And though Trump insists that his beloved tariff hikes are going to help workers, they will actually raise the prices of goods, hurting the working class and other low-income Americans the most .
Then there are the obstacles those susceptible to suicide face in receiving insurance-provided mental-health care. If you're a white worker without medical coverage or have a policy with a deductible and co-payments that are high and your income, while low, is too high to qualify for Medicaid, Trump and the GOP haven't done anything for you. Never mind the president's tweet proclaiming that "the Republican Party Will Become 'The Party of Healthcare!'"
Let me amend that: actually, they have done something. It's just not what you'd call helpful. The percentage of uninsured adults, which fell from 18% in 2013 to 10.9% at the end of 2016, thanks in no small measure to Obamacare , had risen to 13.7% by the end of last year.
The bottom line? On a problem that literally has life-and-death significance for a pivotal portion of his base, Trump has been AWOL. In fact, to the extent that economic strain contributes to the alarming suicide rate among white workers, his policies are only likely to exacerbate what is already a national crisis of epidemic proportions.
Seamus Padraig , June 19, 2019 at 6:46 am
Trump has neglected his base on pretty much every issue; this one's no exception.
DanB , June 19, 2019 at 8:55 am
Trump is running on the claim that he's turned the economy around; addressing suicide undermines this (false) claim. To state the obvious, NC readers know that Trump is incapable of caring about anyone or anything beyond his in-the-moment interpretation of his self-interest.
JCC , June 19, 2019 at 9:25 am
Not just Trump. Most of the Republican Party and much too many Democrats have also abandoned this base, otherwise known as working class Americans.
The economic facts are near staggering and this article has done a nice job of summarizing these numbers that are spread out across a lot of different sites.
I've experienced this rise within my own family and probably because of that fact I'm well aware that Trump is only a symptom of an entire political system that has all but abandoned it's core constituency, the American Working Class.
sparagmite , June 19, 2019 at 10:13 am
Yep It's not just Trump. The author mentions this, but still focuses on him for some reason. Maybe accurately attributing the problems to a failed system makes people feel more hopeless. Current nihilists in Congress make it their duty to destroy once helpful institutions in the name of "fiscal responsibility," i.e., tax cuts for corporate elites.
dcblogger , June 19, 2019 at 12:20 pm
Maybe because Trump is president and bears the greatest responsibility in this particular time. A great piece and appreciate all the documentation.
Svante , June 19, 2019 at 7:00 am
I'd assumed, the "working class" had dissappeared, back during Reagan's Miracle? We'd still see each other, sitting dazed on porches & stoops of rented old places they'd previously; trying to garden, fix their car while smoking, drinking or dazed on something? Those able to morph into "middle class" lives, might've earned substantially less, especially benefits and retirement package wise. But, a couple decades later, it was their turn, as machines and foreigners improved productivity. You could lease a truck to haul imported stuff your kids could sell to each other, or help robots in some warehouse, but those 80s burger flipping, rent-a-cop & repo-man gigs dried up. Your middle class pals unemployable, everybody in PayDay Loan debt (without any pay day in sight?) SHTF Bug-out bags® & EZ Credit Bushmasters began showing up at yard sales, even up North. Opioids became the religion of the proletariat Whites simply had much farther to fall, more equity for our betters to steal. And it was damned near impossible to get the cops to shoot you?
Man, this just ain't turning out as I'd hoped. Need coffee!
Svante , June 19, 2019 at 7:55 am
We especially love the euphemism "Deaths O' Despair." since it works so well on a Chyron, especially supered over obese crackers waddling in crusty MossyOak™ Snuggies®
DanB , June 19, 2019 at 9:29 am
This is a very good article, but I have a comment about the section titled, "The Race Enigma." I think the key to understanding why African Americans have a lower suicide rate lies in understanding the sociological notion of community, and the related concept Emil Durkheim called social solidarity. This sense of solidarity and community among African Americans stands in contrast to the "There is no such thing as society" neoliberal zeitgeist that in fact produces feelings of extreme isolation, failure, and self-recriminations. An aside: as a white boy growing up in 1950s-60s Detroit I learned that if you yearned for solidarity and community what you had to do was to hang out with black people.
Amfortas the hippie , June 19, 2019 at 2:18 pm
" if you yearned for solidarity and community what you had to do was to hang out with black people."
amen, to that. in my case rural black people.
and I'll add Hispanics to that.
My wife's extended Familia is so very different from mine.
Solidarity/Belonging is cool.
I recommend it.
on the article we keep the scanner on("local news").we had a 3-4 year rash of suicides and attempted suicides(determined by chisme, or deduction) out here.
all of them were despair related more than half correlated with meth addiction itself a despair related thing.
ours were equally male/female, and across both our color spectrum.
that leaves economics/opportunity/just being able to get by as the likely cause.
David B Harrison , June 19, 2019 at 10:05 am
What's left out here is the vast majority of these suicides are men.
Christy , June 19, 2019 at 1:53 pm
Actually, in the article it states:
"There are gender-based differences as well. From 1999 to 2017, the rate for men was substantially higher than for women -- almost four-and-a-half times higher in the first of those years, slightly more than three-and-a-half times in the last."
jrs , June 19, 2019 at 1:58 pm
which in some sense makes despair the wrong word, as females are actually quite a bit more likely to be depressed for instance, but much less likely to "do the deed". Despair if we mean a certain social context maybe, but not just a psychological state.
Ex-Pralite Monk , June 19, 2019 at 10:10 am
You lay off the racial slur "cracker" and I'll lay off the racial slur "nigger". Deal?
rd , June 19, 2019 at 10:53 am
Suicide deaths are a function of the suicide attempt rate and the efficacy of the method used. A unique aspect of the US is the prevalence of guns in the society and therefore the greatly increased usage of them in suicide attempts compared to other countries. Guns are a very efficient way of committing suicide with a very high "success" rate. As of 2010, half of US suicides were using a gun as opposed to other countries with much lower percentages. So if the US comes even close to other countries in suicide rates then the US will surpass them in deaths. https://en.wikipedia.org/wiki/Suicide_methods#Firearms
Now we can add in opiates, especially fentanyl, that can be quite effective as well.
The economic crisis hitting middle America over the past 30 years has been quite focused on the states and populations that also tend to have high gun ownership rates. So suicide attempts in those populations have a high probability of "success".
Joe Well , June 19, 2019 at 11:32 am
I would just take this opportunity to add that the police end up getting called in to prevent on lot of suicide attempts, and just about every successful one.
In the face of so much blanket demonization of the police, along with justified criticism, it's important to remember that.
B:H , June 19, 2019 at 11:44 am
As someone who works in the mental health treatment system, acute inpatient psychiatry to be specific, I can say that of the 25 inpatients currently here, 11 have been here before, multiple times. And this is because of several issues, in my experience: inadequate inpatient resources, staff burnout, inadequate support once they leave the hospital, and the nature of their illnesses. It's a grim picture here and it's been this way for YEARS. Until MAJOR money is spent on this issue it's not going to get better. This includes opening more facilities for people to live in long term, instead of closing them, which has been the trend I've seen.
B:H , June 19, 2019 at 11:53 am
One last thing the CEO wants "asses in beds", aka census, which is the money maker. There's less profit if people get better and don't return. And I guess I wouldn't have a job either. Hmmmm: sickness generates wealth.
Jun 19, 2019 | www.unz.com
Early in any psychology course, students are taught to be very cautious about accepting people's reports. A simple trick is to stage some sort of interruption to the lecture by confederates, and later ask the students to write down what they witnessed. Typically, they will misremember the events, sequences and even the number of people who staged the tableaux. Don't trust witnesses, is the message.
Another approach is to show visual illusions, such as getting estimates of line lengths in the Muller-Lyer illusion, or studying simple line lengths under social pressure, as in the Asch experiment, or trying to solve the Peter Wason logic problems, or the puzzles set by Kahneman and Tversky. All these appear to show severe limitations of human judgment. Psychology is full of cautionary tales about the foibles of common folk.
As a consequence of this softening up, psychology students come to regard themselves and most people as fallible, malleable, unreliable, biased and generally irrational. No wonder psychologists feel superior to the average citizen, since they understand human limitations and, with their superior training, hope to rise above such lowly superstitions.
However, society still functions, people overcome errors and many things work well most of the time. Have psychologists, for one reason or another, misunderstood people, and been too quick to assume that they are incapable of rational thought?
Gerd Gigerenzer thinks so.
He is particularly interested in the economic consequences of apparent irrationality, and whether our presumed biases really result in us making bad economic decisions. If so, some argue we need a benign force, say a government, to protect us from our lack of capacity. Perhaps we need a tattoo on our forehead: Diminished Responsibility.
The argument leading from cognitive biases to governmental paternalism -- in short, the irrationality argument -- consists of three assumptions and one conclusion:
1. Lack of rationality. Experiments have shown that people's intuitions are systematically biased.
2. Stubbornness. Like visual illusions, biases are persistent and hardly corrigible by education.
3. Substantial costs. Biases may incur substantial welfare-relevant costs such as lower wealth, health, or happiness.
4. Biases justify governmental paternalism. To protect people from theirbiases, governments should "nudge" the public toward better behavior.
The three assumptions -- lack of rationality, stubbornness, and costs -- imply that there is slim chance that people can ever learn or be educated out of their biases; instead governments need to step in with a policy called libertarian paternalism (Thaler and Sunstein, 2003).
So, are we as hopeless as some psychologists claim we are? In fact, probably not. Not all the initial claims have been substantiated. For example, it seems we are not as loss averse as previously claimed. Does our susceptibility to printed visual illusions show that we lack judgement in real life?
In Shepard's (1990) words, "to fool a visual system that has a full binocular and freely mobile view of a well-illuminated scene is next to impossible" (p. 122). Thus, in psychology, the visual system is seen more as a genius than a fool in making intelligent inferences, and inferences, after all, are necessary for making sense of the images on the retina.
Most crucially, can people make probability judgements? Let us see. Try solving this one:
A disease has a base rate of .1, and a test is performed that has a hit rate of .9 (the conditional probability of a positive test given disease) and a false positive rate of .1 (the conditional probability of a positive test given no disease). What is the probability that a random person with a positive test result actually has the disease?
Most people fail this test, including 79% of gynaecologists giving breast screening tests. Some researchers have drawn the conclusion that people are fundamentally unable to deal with conditional probabilities. On the contrary, there is a way of laying out the problem such that most people have no difficulty with it. Watch what it looks like when presented as natural frequencies:
Among every 100 people, 10 are expected to have a disease. Among those 10, nine are expected to correctly test positive. Among the 90 people without the disease, nine are expected to falsely test positive. What proportion of those who test positive actually have the disease?
In this format the positive test result gives us 9 people with the disease and 9 people without the disease, so the chance that a positive test result shows a real disease is 50/50. Only 13% of gynaecologists fail this presentation.
Summing up the virtues of natural frequencies, Gigerenzer says:
When college students were given a 2-hour course in natural frequencies, the number of correct Bayesian inferences increased from 10% to 90%; most important, this 90% rate was maintained 3 months after training (Sedlmeier and Gigerenzer, 2001). Meta-analyses have also documented the "de-biasing" effect, and natural frequencies are now a technical term in evidence-based medicine (Akiet al., 2011; McDowell and Jacobs, 2017). These results are consistent with a long literature on techniques for successfully teaching statistical reasoning (e.g., Fonget al., 1986). In sum, humans can learn Bayesian inference quickly if the information is presented in natural frequencies.
If the problem is set out in a simple format, almost all of us can all do conditional probabilities.
I taught my medical students about the base rate screening problem in the late 1970s, based on: Robyn Dawes (1962) "A note on base rates and psychometric efficiency". Decades later, alarmed by the positive scan detection of an unexplained mass, I confided my fears to a psychiatrist friend. He did a quick differential diagnosis on bowel cancer, showing I had no relevant symptoms, and reminded me I had lectured him as a student on base rates decades before, so I ought to relax. Indeed, it was false positive.
Here are the relevant figures, set out in terms of natural frequencies
Every test has a false positive rate (every step is being taken to reduce these), and when screening is used for entire populations many patients have to undergo further investigations, sometimes including surgery.
Setting out frequencies in a logical sequence can often prevent misunderstandings. Say a man on trial for having murdered his spouse has previously physically abused her. Should his previous history of abuse not be raised in Court because only 1 woman in 2500 cases of abuse is murdered by her abuser? Of course, whatever a defence lawyer may argue and a Court may accept, this is back to front. OJ Simpson was not on trial for spousal abuse, but for the murder of his former partner. The relevant question is: what is the probability that a man murdered his partner, given that she has been murdered and that he previously battered her.
Accepting the figures used by the defence lawyer, if 1 in 2500 women are murdered every year by their abusive male partners, how many women are murdered by men who did not previously abuse them? Using government figures that 5 women in 100,000 are murdered every year then putting everything onto the same 100,000 population, the frequencies look like this:
So, 40 to 5, it is 8 times more probable that abused women are murdered by their abuser. A relevant issue to raise in Court about the past history of an accused man.
Are people's presumed biases costly, in the sense of making them vulnerable to exploitation, such that they can be turned into a money pump, or is it a case of "once bitten, twice shy"? In fact, there is no evidence that these apparently persistent logical errors actually result in people continually making costly errors. That presumption turns out to be a bias bias.
Gigerenzer goes on to show that people are in fact correct in their understanding of the randomness of short sequences of coin tosses, and Kahneman and Tversky wrong. Elegantly, he also shows that the "hot hand" of successful players in basketball is a real phenomenon, and not a stubborn illusion as claimed.
With equal elegance he disposes of a result I had depended upon since Slovic (1982), which is that people over-estimate the frequency of rare risks and under-estimate the frequency of common risks. This finding has led to the belief that people are no good at estimating risk. Who could doubt that a TV series about Chernobyl will lead citizens to have an exaggerated fear of nuclear power stations?
The original Slovic study was based on 39 college students, not exactly a fair sample of humanity. The conceit of psychologists knows no bounds. Gigerenzer looks at the data and shows that it is yet another example of regression to the mean. This is an apparent effect which arises whenever the predictor is less than perfect (the most common case), an unsystematic error effect, which is already evident when you calculate the correlation coefficient. Parental height and their children's heights are positively but not perfectly correlated at about r = 0.5. Predictions made in either direction will under-predict in either direction, simply because they are not perfect, and do not capture all the variation. Try drawing out the correlation as an ellipse to see the effect of regression, compared to the perfect case of the straight line of r= 1.0
What diminishes in the presence of noise is the variability of the estimates, both the estimates of the height of the sons based on that of their fathers, and vice versa. Regression toward the mean is a result of unsystematic, not systematic error (Stigler,1999).
Gigerenzer also looks at the supposed finding that people are over-confidence in predictions, and finds that it is another regression to the mean problem.
Gigerenzer then goes on to consider that old favourite, that most people think they are better than average, which supposedly cannot be the case, because average people are average.
Consider the finding that most drivers think they drive better than average. If better driving is interpreted as meaning fewer accidents, then most drivers' beliefs are actually true. The number of accidents per person has a skewed distribution, and an analysis of U.S. accident statistics showed that some 80% of drivers have fewer accidents than the average number of accidents (Mousavi and Gigerenzer, 2011)
Then he looks at the classical demonstration of framing, that is to say, the way people appear to be easily swayed by how the same facts are "framed" or presented to the person who has to make a decision.
A patient suffering from a serious heart disease considers high-risk surgery and asks a doctor about its prospects.
The doctor can frame the answer in two ways:
Positive Frame: Five years after surgery, 90% of patients are alive.
Negative Frame: Five years after surgery, 10% of patients are dead.
Should the patient listen to how the doctor frames the answer? Behavioral economists say no because both frames are logically equivalent (Kahneman, 2011). Nevertheless, people do listen. More are willing to agree to a medical procedure if the doctor uses positive framing (90% alive) than if negative framing is used (10% dead) (Moxeyet al., 2003). Framing effects challenge the assumption of stable preferences, leading to preference reversals. Thaler and Sunstein (2008) who presented the above surgery problem, concluded that "framing works because people tend to be somewhat mindless, passive decisionmakers" (p. 40)
Gigerenzer points out that in this particular example, subjects are having to make their judgements without knowing a key fact: how many survive without surgery. If you know that you have a datum which is more influential. These are the sorts of questions patients will often ask about, and discuss with other patients, or with several doctors. Furthermore, you don't have to spin a statistic. You could simply say: "Five years after surgery, 90% of patients are alive and 10% are dead".
Gigerenzer gives an explanation which is very relevant to current discussions about the meaning of intelligence, and about the power of intelligence tests:
In sum, the principle of logical equivalence or "description invariance" is a poor guide to understanding how human intelligence deals with an uncertain world where not everything is stated explicitly. It misses the very nature of intelligence, the ability to go beyond the information given (Bruner, 1973)
The key is to take uncertainty seriously, take heuristics seriously, and beware of the bias bias.
One important conclusion I draw from this entire paper is that the logical puzzles enjoyed by Kahneman, Tversky, Stanovich and others are rightly rejected by psychometricians as usually being poor indicators of real ability. They fail because they are designed to lead people up the garden path, and depend on idiosyncratic interpretations.
For more detail: http://www.unz.com/jthompson/the-tricky-question-of-rationality/
Critics of examinations of either intellectual ability or scholastic attainment are fond of claiming that the items are "arbitrary". Not really. Scholastic tests have to be close to the curriculum in question, but still need to a have question forms which are simple to understand so that the stress lies in how students formulate the answer, not in how they decipher the structure of the question.
Intellectual tests have to avoid particular curricula and restrict themselves to the common ground of what most people in a community understand. Questions have to be super-simple, so that the correct answer follows easily from the question, with minimal ambiguity. Furthermore, in the case of national scholastic tests, and particularly in the case of intelligence tests, legal authorities will pore over the test, looking at each item for suspected biases of a sexual, racial or socio-economic nature. Designing an intelligence test is a difficult and expensive matter. Many putative new tests of intelligence never even get to the legal hurdle, because they flounder on matters of reliability and validity, and reveal themselves to be little better than the current range of assessments.
In conclusion, both in psychology and behavioural economics, some researchers have probably been too keen to allege bias in cases where there are unsystematic errors, or no errors at all. The corrective is to learn about base rates, and to use natural frequencies as a guide to good decision-making.
Don't bother boosting your IQ. Boost your understanding of natural frequencies.
res , says: June 17, 2019 at 3:29 pm GMTGood concrete advice. Perhaps even more useful for those who need to explain things like this to others than for those seeking to understand for themselves.ThreeCranes , says: June 17, 2019 at 3:34 pm GMT"intelligence deals with an uncertain world where not everything is stated explicitly. It misses the very nature of intelligence, the ability to go beyond the information given (Bruner, 1973)"Tom Welsh , says: June 18, 2019 at 8:36 am GMT
"The key is to take uncertainty seriously, take heuristics seriously, and beware of the bias bias."
Why I come to Unz.@Cortes Sounds fishy to me.Biff , says: June 18, 2019 at 10:16 am GMT
Actually I think this is an example of an increasingly common genre of malapropism, where the writer gropes for the right word, finds one that is similar, and settles for that. The worst of it is that readers intuitively understand what was intended, and then adopt the marginally incorrect usage themselves. That's perhaps how the world and his dog came to say "literally" when they mean "figuratively". Maybe a topic for a future article?In 2009 Google finished engineering a reverse search engine to find out what kind of searches people did most often. Seth Davidowitz and Steven Pinker wrote a very fascinating/entertaining book using the tool called Everybody Liesdearieme , says: June 18, 2019 at 11:25 am GMT
Everybody Lies offers fascinating, surprising, and sometimes laugh-out-loud insights into everything from economics to ethics to sports to race to sex, gender, and more, all drawn from the world of big data. What percentage of white voters didn't vote for Barack Obama because he's black? Does where you go to school effect how successful you are in life? Do parents secretly favor boy children over girls? Do violent films affect the crime rate? Can you beat the stock market? How regularly do we lie about our sex lives, and who's more self-conscious about sex, men or women?
Investigating these questions and a host of others, Seth Stephens-Davidowitz offers revelations that can help us understand ourselves and our lives better. Drawing on studies and experiments on how we really live and think, he demonstrates in fascinating and often funny ways the extent to which all the world is indeed a lab. With conclusions ranging from strange-but-true to thought-provoking to disturbing, he explores the power of this digital truth serum and its deeper potential – revealing biases deeply embedded within us, information we can use to change our culture, and the questions we're afraid to ask that might be essential to our health – both emotional and physical. All of us are touched by big data every day, and its influence is multiplying. Everybody Lies challenges us to think differently about how we see it and the world.I shall treat this posting (for which many thanks, doc) as an invitation to sing a much-loved song: everybody should read Gigerenzer's Reckoning with Risk. With great clarity it teaches what everyone ought to know about probability.Anon  • Disclaimer , says: June 18, 2019 at 3:47 pm GMT
(It could also serve as a model for writing in English about technical subjects. Americans and Britons should study the English of this German – he knows how, you know.)
Inspired by "The original Slovic study was based on 39 college students" I shall also sing another favorite song. Much of Psychology is based on what small numbers of American undergraduates report they think they think." Gigerenzer points out that in this particular example, subjects are having to make their judgements without knowing a key fact: how many survive without surgery. "Cortes , says: June 18, 2019 at 4:14 pm GMT
This one reminds of the false dichotomy. The patient has additional options! Like changing diet, and behaviours such as exercise, elimination of occupational stress , etc.
The statistical outcomes for a person change when the person changes their circumstances/conditions.@Tom Welsh A disposition (conveyance) of an awkwardly shaped chunk out of a vast estate contained reference to "the slither of ground bounded on or towards the north east and extending two hundred and twenty four meters or thereby along a chain link fence " Not poor clients (either side) nor cheap lawyers. And who never erred?Tom Fix , says: June 18, 2019 at 4:25 pm GMT
Better than deliberately inserting "errors" to guarantee a stream of tidy up work (not unknown in the "professional" world) in future.Good article. 79% of gynaecologists fail a simple conditional probability test?! Many if not most medical research papers use advanced statistics. Medical doctors must read these papers to fully understand their field. So, if medical doctors don't fully understand them, they are not properly doing their job. Those papers use mathematical expressions, not English. Converting them to another form of English, instead of using the mathematical expressions isn't a solution.SafeNow , says: June 18, 2019 at 5:49 pm GMTRegarding witnesses: When that jet crashed into Rockaway several years ago, a high percentage of witnesses said that they saw smoke before the crash. But there was actually no smoke. The witnesses were adjusting what they saw to conform to their past experience of seeing movie and newsreel footage of planes smoking in the air before a crash. Children actually make very good witnesses.Anon  • Disclaimer , says: June 18, 2019 at 9:48 pm GMT
Regarding the chart. Missing, up there in the vicinity of cancer and heart disease. The third-leading cause of death. 250,000 per year, according to a 2016 Hopkins study. Medical negligence.Curmudgeon , says: June 19, 2019 at 1:42 am GMT
1. Lack of rationality. Experiments have shown that people's intuitions are systematically biased.
2. Stubbornness. Like visual illusions, biases are persistent and hardly corrigible by education.
3. Substantial costs. Biases may incur substantial welfare-relevant costs such as lower wealth, health, or happiness.
4. Biases justify governmental paternalism. To protect people from theirbiases, governments should "nudge" the public toward better behavior.
Well the sad fact is that there's nobody in the position to protect "governments" from their own biases, and "scientists" from theirs.
So, behind the smoke of all words and rationalisations, the law is unchanged: everyone strives to gain and exert as much power as possible over as many others as possible. Most do that without writing papers to say it is right, others write papers, others books. Anyway, the fundamental law would stay as it is even if all this writing labour was spared, wouldn't it? But then another fundamental law, the law of framing all one's drives as moral and beneffective comes into play the papers and the books are useful, after all.An interesting article. However, I think that the only thing we have to know about how illogical psychiatry is this:Paul2 , says: June 19, 2019 at 8:08 am GMT
In 1973, the American Psychiatric Association (APA) asked all members attending its convention to vote on whether they believed homosexuality to be a mental disorder. 5,854 psychiatrists voted to remove homosexuality from the DSM, and 3,810 to retain it.
The APA then compromised, removing homosexuality from the DSM but replacing it, in effect, with "sexual orientation disturbance" for people "in conflict with" their sexual orientation. Not until 1987 did homosexuality completely fall out of the DSM.
(source https://www.psychologytoday.com/ca/blog/hide-and-seek/201509/when-homosexuality-stopped-being-mental-disorder )
The article makes no mention of the fact that no "new science" was brought to support the resolution.
It appears that the psychiatrists were voting based on feelings rather than science. Since that time, the now 50+ genders have been accepted as "normal" by the APA. My family has had members in multiple generations suffering from mental illness. None were "cured". I know others with the same circumstances.
How does one conclude that being repulsed by the prime directive of every living organism – reproduce yourself – is "normal"? That is not to say these people are horrible or evil, just not normal. How can someone, who thinks (s)he is a cat be mentally ill, but a grown man thinking he is a female child is not?
Long ago a lawyer acquaintance, referring to a specific judge, told me that the judge seemed to "make shit up as he was going along". I have long held psychiatry fits that statement very well.Thank you for this article. I find the information about the interpretation of statistical data very interesting. My take on the background of the article is this:Dieter Kief , says: June 19, 2019 at 8:22 am GMT
Here we have a real scientist fighting the nonsense spreading from (neoclassical) economics into other realms of science/academia.
Behavioral economics is a sideline by-product of neoclassical micro-economic theory. It tries to cope with experimental data that is inconsistent with that theory.
Everything in neoclassical economics is a travesty. "Rational choice theory" and its application in "micro economics" is false from the ground up. It basically assumes that people are gobbling up resources without plan, meaning or relevant circumstances. Neoclassical micro economic theory is so false and illogical that I would not know where to start in a comment, so I should like to refer to a whole book about it:
Keen, Steve: "Debunking economics".
As the theory is totally wrong it is really not surprising that countless experiments show that people do not behave the way neoclassical theory predicts. How do economists react to this? Of course they assume that people are "irrational" because they do not behave according to their studied theory. (Why would you ever change your basic theory because of some tedious facts?)
We live in a strange world in which such people have control over university faculties, journals, famous prizes. But at least we have some scientists who defend their area of knowledge against the spreading nonsense produced by economists.
The title of the 1st ed. of Keen's book was "Debunking Economics: The Naked Emperor of the Social Sciences" which was simply a perfect title.@Curmudgeon Could it be that you expect psychiatrists in the past to be as rational as you are now?
Would the result have been any different, if members of a 1973 convention of physicists or surgeons would have been asked?
Jun 16, 2019 | dissidentvoice.org
by Jason Hirthler / June 14th, 2019Once declared by The New York Times to be, "the most important intellectual alive," a quote it surely regrets, prolific gadfly Noam Chomsky has said that, "Any dictator would admire the uniformity and obedience of the U.S. media." How true. However, the same dictator might find the sloppy, often incoherent work of that uniform press to be a problem in need of a solution, especially at a time when it finds itself assaulted on all sides by alternative media. The mainstream finds itself desperately waging rearguard actions as it stumbles beyond the shadow of respectability. As it retreats into a shell of reactionary conformity, the mainstream has become a parody of itself. Once, its propaganda was well-crafted and replete with nuance and high-quality dissimulation, such that the average American reader could be duped regardless of his or her preconceived notions.
That is no longer the case. The demise of authority in the mainstream is thanks largely to the relentless round-the-clock news cycle and a deep bias in favor of sound bytes and sensationalism. How ironic that the collapse of faith in western media is caused by its own relentless fealty to profitability. The corporate press has now become, for vast segments of the population, a transparently deceitful congeries of second-rate pseudo-journalists who traffic in base fictions at the behest of elite capital. Meanwhile, ranks of first-rate independent journalists now dot the coarse hide of the staggering beast of the mainstream, more woodpeckers than parasites, slowly penetrating the dense carapace of falsehood that coarsens the consciousness of western citizenry. Only relentless infusions of capital are keeping the beast alive. Quantitative easing for the propaganda class.
If you want a nice index of the abysmal depths to which modern political discourse has sunk, there are dozens of pristine examples on YouTube. In fact, the site is in some sense a junk-strewn wasteland of western cultural debris, each piece of trash boasting thousands of views. I recently watched an episode of the BBC's, "The Daily Politics", now mercifully discontinued after 15 years of spreading disinformation disguised as "in depth" coverage of political events. Last July, just before being shuttered for good,, the show hosted the communist Aaron Bastani. (Perhaps this was another effort to align Labour's Jeremy Corbyn with the fraudulent effigies of Stalin and Mao.)
This show is a particularly good example of what happens when a freethinker is for some reason permitted time on a mainstream network and utters viewpoints that are well outside the Overton Window of acceptable opinion. The airing of such thinkers is not, as most suspect, an example of an open press, but rather a calculated effort to censor unacceptable ideas. On a psychological level, it serves the same purpose of unifying the herd as burning witches did in the medieval epoch. There is some sort of malign catharsis in communal attacks on ideological enemies. Just look at the vicious historical Hindu violence against minority Muslims in India. Communalism, they call it. In any event, this collection of pseudo-journalists, arrayed around a table in comfortable chairs, was an especially nice representation of the idiocy of our current political dialogue. Four neoliberals had to be brought on to collectively mock, browbeat, and quiz the good-natured YouTube host of "The Bastani Factor" on his bizarre communist politics.
Theater of the Absurd
The stage is set by show producers when they cast a giant image of a yellow hammer and sickle against a vast background of red (gulag blood, no doubt). This farcical backdrop covers half the set. The "guest" Bastani is first mocked for handing out a t-shirt that says, "I'm literally a communist." Then he is asked by moderator Jo Coburn, a haughty establishment tool with a penchant for constant interruptions, whether or not Bastani is simply whitewashing "a murderous ideology."
After Bastani finishes describing communism for the panel, Laura Hughes of the highly esteemed Financial Times declares that she felt like she'd just sat through her high school history class all over again, and that what was really needed was, "a new word" other than communism, since the latter was obviously so freighted with capitalist propaganda (she didn't exactly say that). Political pundit and Tory Matthew Parris then jumps in to say he's perfectly comfortable with the current word, and that Marx was perfectly clear about what he meant by it. Hughes gazes at Parris, nodding with a condescending smile, before Coburn leaps in to ask again about the supposedly nine million slaughtered at the hands of Stalin's purges, gulags, and induced famines. Parris laughs uncomfortably and defensively remarks, "Well, I'm not a communist!" But the bloodthirsty Coburn isn't satisfied. Is understanding communism not, in effect, trivializing its crimes? Parris then confirms for all and sundry that the practice of communism will most certainly require mass slaughter.
Coburn jumps back to Bastani, asking whether it requires violence. Rather than say it requires the seizure of property from the ruling class, and that this act might inspire violent resistance, as it did from the kulaks following the Bolshevik revolution, Bastani attempts to smooth it all over with an anecdote from the 14th century, which appeases no one and distracts everyone. Here another conservative journalist, Suzanne Evans, declares, in reference to the disturbing t-shirt, to say, "I'm literally a communist" is tantamount to saying, "I'm literally a fascist." Hughes bounces up and down in her chair and reminds the panel that communism "didn't work!" She then reiterates her call for "a new word." Someone then asks whether Labour leader Jeremy Corbyn would wear Bastani's communist t-shirt, prompting Bastani to point out that Corbyn isn't actually a communist. Evans smugly replies, "He's 90 percent a communist" (to guffaws in the gallery).
Parris has by this point recovered from the dreadful insinuation that he was a tankie. He then announces that one of the main problems with communism, aside from the mass slaughter, is that it still has a "student Che Guevara mystique about it." This insight is met with knowing nods and throaty growls from the panel. He then bafflingly adds that free marketers (like himself) "haven't been robust enough in defending what we believe in." Bastani might have noted that a century of nonstop laissez faire propaganda from the business press should surely have squelched a few noisy gangs of undergrads in Che t-shirts. Alas, the show then dribbled to a close, everyone declining the offer of the t-shirt as though it were smallpox-infested blanket from colonial times.
The comments section beneath the YouTube video was largely sympathetic to Bastani, but in places typically descended into an intra-communist debate about what communism actually is, with one ideologue insisting that, "The USSR was not remotely Marxist!" Several naysayers chimed in with the usual boilerplate about how everything we enjoy today is a product of capitalism and how capitalism is "by far" the best system ever conceived for human prosperity, etc. As usual, the capitalists take credit for everything except the death toll.
Unfortunately, this is garden variety stuff on mainstream television. One hardly utters a non-mainstream perspective before opposition pundits have their hackles up and are firing off stock phrases about the glories of the free market. There are numberless responses to this kind of commercial pablum, of which a handful come to mind.
First, no one is saying capitalism isn't a great engine of material production. Even Marx praised it on that count. But we should never tire of pointing out that capitalism isn't about markets; it's the division of resources between capital and labor, the latter of which get brutally exploited by the former. As for markets, there were plenty of slave markets in the ancient world, and plenty of markets under feudalism, and there have been plenty of markets in socialist economies. Second, the numerous social advances made in the US were made in spite of capitalism, not because of it. It's not as though the franchise, the eight-hour work day, or the social safety net were commodities distributed by profit-seeking capitalists in some magically humane laissez faire agora.
Third, the Soviet Union was a demonstrable success, achieving some remarkable industrial gains during just the Thirties alone, before western jackals watched while the Nazi Wehrmacht rolled into Russia, and was finally unraveled by pro-western factions within the Soviet state. The German Democratic Republic is another example of a profoundly different, and generally more humane, kind of social organization, that is continuously given the short shrift by ideologues hurling their "Stasi state" jibes into the bristling ether of social media. Fourth, we'd have never even begun to exit the Great Recession of 2008 without China's command economy, with its various socialist aims and government controlled production.
Fifth, no one bothers to investigate the propaganda surrounding communism, referred to in this awful BBC show as a "murderous ideology". The purge and gulag and famine death figures were popularly disseminated largely by Robert Conquest, a British propagandist, and are suspect at best, and at worst fraudulent. The majority of the left won't even go there for fear of crossing the threshold into pariah status, and being thrust into that burgeoning cultural pen of actual socialists and communists. Sixth, there are thought to be some 20 million people since the end of WWII who have died at the hands of imperial capitalism, and its unquenchable thirst for new markets. Those figures are not likely to be falsified, at least partially because they are not the product of a ferociously anti-Communist propaganda system, but rather independent alternative journalists without a bourgeois mandate to romanticize neoliberalism and demonize communism. Nor are those numbers likely to stall; the implacable drive for hegemony promises much more slaughter, with many more million brown men, women, and children adding to the figures, plenty of them doubtless LGBTQ+ and trans. Seventh, India, for instance, is hardly better off than it was before the capitalist invasion by Britain. Same goes for the Congo or anyplace else capital has reached for market access. Life in the metropole is considerably different than life in the ransacked provinces.
Eighth, when you argue for the current system, you're arguing for a capitalist oligarchy in which 1 percent of humanity controls more than half the world's wealth, and 30 percent control 95 percent of the wealth, leaving 70 percent of the world's population to support itself on 5 percent of the world's resources, access to which are nevertheless being hotly contested by capital. Ninth, recent studies have shown marked rises in suicides as neoliberal austerity takes hold in the metropole itself, while hundreds of thousands of Indian farmers have taken their own lives thanks to neoliberal structural reforms in a story that provoked meager interest in western capitals. Tenth, it's been conclusively shown that we are heading into the sixth mass extinction event in history, produced by capitalist industrialization. Yet almost all of us are in denial, either as Republicans hastily summoning their liberal conspiracy talking points, or as neoliberal Democrats who still cling to the meager thread of the Obama era and the Paris Accords, as if Obama and Paris were really going to address climate change the way it needs to be addressed.
Alas, these responses might have short-circuited the hive mind of the BBC panel. Facts, hurled into a pandemonium of deceits, can have that effect. Of course, Bastani was shuttled away before any of these considerations were tabled, the benighted doxies of imperialism happy to have had another go at the far left before decamping for their next bourgeois dinner party, anxious to don their own 'most important intellectual' attire and regale placid peers of the intelligentsia with tales of ideology run amuck.
Jason Hirthler is a writer, political commentator, and veteran of the communications industry. He has written for many political communities. He is the recent author of Imperial Fictions , a collection of essays from between 2015-2017. He lives in New York City and can be reached at email@example.com . Read other articles by Jason .
This article was posted on Friday, June 14th, 2019 at 8:23pm and is filed under Capitalism , Communism/Marxism/Maoism , Corporate media , Media , Media Bias , Social media .
Jun 16, 2019 | www.nakedcapitalism.com
https://eus.rubiconproject.com/usync.html <img src="http://b.scorecardresearch.com/p?c1=2&c2=16807273&cv=2.0&cj=1" /> Economic Growth: A Short History of a Controversial Idea Posted on June 15, 2019 by Yves Smith By Gareth Dale, who teaches at Brunel University. He publishes occasionally in The Ecologist . This article includes passages from previously published texts, including 'The tide is rising, don't rock the boat!' Economic growth and the legitimation of inequality (2018), Seventeenth century origins of the growth paradigm (2017), and The growth paradigm: A critique (2012). Originally published at openDemocracy
The politics of economic growth are complex and contested as never before. In rich countries, rates of GDP growth have declined, decade after decade since the 1960s. The 2008 crash was deep, and the post-crisis recovery has been slow. This poses problems for governments, given that their 'performance legitimacy' requires some degree of popular approval of their perceived success in charting a growth path that satisfies the citizenry's demand for goods and services. Where growth is low and governments choose to respond with austerity programmes, these bring additional misery and hardship -- including tens of thousands of premature deaths in Britain alone .
In the same decades, growth scepticism has thrived. It takes two main forms: one highlights the impact of infinite growth on finite resources and on the natural environment. Recognition of the dangers of climate breakdown has transformed this debate – while mainstream opinion retains the traditional faith in growth, now refashioned as ' green growth ', the heretics are rallying to ' degrowth '.
The other emphasises the disconnect between growth and social well-being. The days are long gone when growth was seen as the fast track to general prosperity, as normal and natural as sunrise. It is well established that the relationship between growth and well-being is partial at best. Such a correlation does exist, but weakens after a certain point -- roughly speaking when per capita GDP exceeds $15,000. At higher levels, the translation of growth into improvements in health and well-being is tenuous. Other variables, notably levels of equality, are critical.
In combination, these developments have motivated the ' Beyond GDP ' agenda. Whether for reasons of growth scepticism or out of concern that if GDP growth remains slack governments' performance legitimacy will suffer too, political leaders, civil servants and academics -- among them Nicolas Sarkozy , Jacinda Ardern , Gus O'Donnell , Joseph Stiglitz and Amartya Sen -- are promoting alternative yardsticks.
To assess these debates it helps to dig into the history and morphology of the 'growth paradigm' -- the belief that economic growth is good, imperative, essentially limitless, and the principal remedy for a litany of social problems – and ask the following: when and how did this paradigm originate?
From Rain Dance to Nasdaq
One response was offered in 1960 by Elias Canetti . In quasi-Nietzschean vein, he invoked a transhistorical 'will to grow'. Humans are always striving for more . Whether the parent monitoring her child's weight or the state official seeking to augment her power, or the community expanding its population, we all want growth. The desire to accumulate goods, the drive for economic growth, the wish for prosperity – they are all innate to human social being. Humans in groups are driven to seek increase: of their numbers, of the conditions of production, and of the products they require and desire. The very earliest homo sapiens sought the enlargement of their "own horde through a plentiful supply of children." And later, in the age of modern industrial production, the growth drive came into its own.
"If there is now one faith, it is faith in production, the modern frenzy of increase; and all the peoples of the world are succumbing to it one after the other. Every factory is a unit serving the same cult. What is new is the acceleration of the process. What in former days was generation and increase of expectancy, directed towards rain or corn, has today become production itself." A straight line runs from the rain dance to the Nasdaq.
But this is to confuse the wiring of our current economy with the wiring of the human brain. Canetti's 'will to grow' doesn't withstand scrutiny. The diverse behaviours he describes can't be reduced to a single logic. The 'will' behind creating babies is quite unlike the will to accumulate acreage or gold. And the latter is relatively recent. For much of the human story, societies were nomadic or semi-nomadic, and organised in immediate-return systems . Stashes of food were set aside to tide the group over for days or weeks, but long-term storage was impractical. The accumulation of possessions would hamper mobility. The measures that such societies used to reduce the risks of scarcity centred not on accumulating stores of goods but on knowledge of the environment, and interpersonal relationships (borrowing, sharing, and so on). The moral economy of sharing necessitates a muscular egalitarianism that is undermined by the accumulation of property.
Logics of accumulation -- and, in the loosest sense, growth -- were not initiated until the Neolithic revolution. Its technological and institutional transformations included settled agriculture and storage, class division, states, warfare and territoriality, and, later, the invention of money. Population growth joined with class exploitation and interstate competition to expand the sway of agrarian empires. Farmers enlarged the ploughlands, scholars penned proposals for improving the organisation of agriculture or trade, merchants amassed wealth, and rulers, seeking to enlarge population and tribute, extended their domains. Only now -- in the post-Neolithic age -- did gold achieve its fetish quality as the source and symbol of power.
Scour the documents from ancient civilisations and you'll find tales of competition for territory and the accumulation of property, but nothing that resembles the modern growth paradigm. No conception of 'an economy' that can grow, still less of one that tends to the infinite. And you'll find little, if any, notion of linear historical progress. Instead, cyclical cosmologies prevailed. A partial exception is the fourteenth century polymath, Ibn Khaldun . He developed a sophisticated analysis of growth dynamics. But his ideas weren't widely adopted, and his theory is cyclical: it describes negative feedback mechanisms that ensure any economic upticks will necessarily hit barriers and retreat.
When, then, did the modern growth paradigm originate -- and why?
The evolution of the growth paradigm was integrally connected to the capitalist system and its colonial thrusts. The basic link between the growth drive and capitalism is transparent. The latter is a system of competitive accumulation. The former, in suggesting that the system is natural and brings benefit also to the '99%', provides ideological cover in that growth serves as an idealised and democratised redescription of capital accumulation. But there's more to it than that. The capitalist transition was to a system of generalised commodity production, in which formal 'productive' economic activity takes the shape of commodities interacting through the price mechanism, in a regularised manner. If earlier political-economic thought had construed its subject as the affairs of the royal household, during the capitalist transition a new model emerged, with an interconnected market field posited as essentially outside the state.
In seventeenth-century England, just as the universe was being re-imagined by Newton et al as a machine determined by lawful regularities, the idea that economic behaviour follows natural laws became commonplace. By the close of the following century, Richard Cantillon had presented the market system as self-equilibrating, a machine that functions in a law-like manner; Quesnay's Tableau had depicted the economic system as a unified process of reproduction; Adam Smith had theorised the dynamics of economic growth; and philosophers (such as William Paley) had developed the creed that steady economic growth legitimates the social system and renders system-critical demands unnecessary and dangerous.
The same centuries experienced a revolution in statistics. In the England of 1600, the growth paradigm could scarcely have existed. No one knew the nation's income, or even its territory or population. By 1700 all these had been calculated , at least in some rough measure, and as new data arrived England's 'material progress' could be charted. Simultaneously, the usage of 'growth' had extended from the natural and concrete toward abstract phenomena: the growth of England's colonies in Virginia and Barbados, the ' growth of trade ,' and suchlike.
But the capitalist transition revolutionised much more than the formal economy and economic concepts. As land came to be regarded as a commodity-like object, the idea -- found to some degree in antiquity -- that nature exists to serve the purposes of landowners and is fundamentally external to human beings, gained definition. The early-modern regimes of abstract social labour and abstract social nature (i.e. the constitution of labour and nature as commodities) were sustained by the scientific revolution, and also by the construction of capitalist time . Over centuries, time became flattened into an abstract, infinite and divisible continuum, one that permitted economic life to be re-imagined as subject to continuous growth and cultivation . Morality was upended, too, most significantly in the discarding of the age-old proscriptions against acquisitiveness.
The more that economic activity came to be marshalled behind the imperatives of capital accumulation, the more it became subject to regimes of 'improvement' and quantification. In Jacobean and Cromwellian England, these practices and discourses proliferated. Agrarian-capitalist improvement was fuelled by scientific discoveries. These, in turn, were spurred on by the navigational and martial demands of explorers, freebooters and conquerors. European settlers in the New World not only exterminated and subjugated 'new' peoples, but turned to objectifying and cataloguing them, drawing comparisons with their own kind and 'improving' them. 'Improvement' and its theologically-intoxicated transplantation to colonial locations generated new data and new demands for detailed knowledge. How profitable is this tract of land, and its denizens? How can they be made more profitable ? Answering such questions was enabled by modern accounting techniques, with their sharper definition of such abstractions as profit and capital.
No surprise, then, that the first statistically rigorous accounting of the wealth of a country (as distinct from, say, a royal household) was conducted by a capitalist on a colonial mission . William Petty planted quantification at the heart of scientific economics, crafted to the purposes of English merchants and empire, and gaining ideological force from the sheen of objectivity with which economic statistics -- or 'political arithmetic' as he termed it -- comes coated. In his work the conquest of nature and the idea of nature as a machine, and of the economy as a productive engine, blended to produce a new concept of wealth as " resources and the productive power to harness them " in contrast to the mercantilist concept, centred on the accumulation of bullion.
Colonisation of the New World contributed powerfully to capital accumulation in Western Europe, but it also spurred Europe's philosophers to elaborate a racialised progress ideology . The question of what to make of the peoples encountered in the Americas, and what implications followed from their property arrangements, stimulated a new reading of the human story: a narrative of social progress. From the vantage point of the colonialists, if 'they' were at the primitive stage, had 'we' once occupied it too?
Centred on a mythical ladder that climbs up from barbarism to civilisation, the progress idea hammered the diversity of human populations into a single temporal-economic chain . By indexing the richer and higher-tech nations (and 'races') as history's vanguard, it justified their bossing of the rest. It was a manifesto that drummed out capital's rhythms, and later found new forms as ' modernisation theory ,' 'the development project,' and so forth, articulated through a grammar of 'growth.' Through its marriage to progress and development, in the belief that social advance requires a steady upward ratchet in national income, growth gained its ideological heft.
The Globalisation of an Ideology
In the nineteenth and twentieth centuries, the consolidation and globalisation of capitalist relations was accompanied by the growth paradigm. The first half of the twentieth century saw its definition sharpen. A pronounced shift occurred from a rather vague sense -- long prevalent -- that government should preside over economic 'improvement' and 'material progress' to an urgent conviction that promoting growth is a matter of national priority. Factors behind the shift included intensified geopolitical rivalry, and the increasing 'muscularity' of states, with their expanded bureaucratic apparatuses, surveillance systems and welfare provision, as well as the segue from the age of empires to that of nation states , a shift that helped consolidate the discourse of the 'national economy.' In many countries the expansion of suffrage was an additional factor: rights were extended and an infrastructure and ideology of national belonging was constructed with the aim of incorporating the lower orders as citizens into the body politic. With the Great Depression, restoring growth became an urgent project of states, and provided the context for the national income accounting that eventually led to GDP.
The acme of the growth paradigm was reached in the mid twentieth century. Growth was firmly established everywhere: in the state-capitalist economies of the 'Second World,' the market economies of the West, and the postcolonial world too. It became part of the economic-cultural furniture, and played a decisive part in binding 'civil society' into capitalist hegemonic structures -- with social democratic parties and trade unions crucial binding agents. It came to be seen as the key metric of national progress and as a magic wand to achieve all sorts of goals: to abolish the danger of returning to depression, to sweeten class antagonisms, to reduce the gap between 'developed' and 'developing' countries, to carve a path to international recognition, and so on. There was a military angle too. For the Cold War rivals, growth promised geopolitical success. "If we lack a first-rate growing economy," cautioned JFK on the campaign trail, " we cannot maintain a first-rate defense ." The greater the rate of growth, it was universally supposed, the lesser the economic, social and political challenges, and the more secure the regime.
The growth paradigm, I suggest, is a form of fetishistic consciousness. It functions as commodity fetishism at one remove. Growth, although the result of social relations among people, assumes the veneer of objective necessity. The growth paradigm elides the exploitative process of accumulation, portraying it instead as a process in the general interest. As Mike Kidron and Elana Gluckstein note, as a system of competition "capitalism depends on the growth of capital; as a class system it depends on obscuring the sources of that growth."
For a long time, GDP growth was widely assumed to be the route to prosperity. Since then, cracks have appeared. In the rich world, we are beginning to realise that continuous GDP growth leads not simply to wealth and wellbeing, but to environmental collapse and barbecued grandchildren. But growth is not its own cause. GDP mirrors the power structure and form of value of capitalist society, but it doesn't define the system's core goal. That goal is the competitive accumulation of capital, and the accounting principles that guide it are those at the level of the firm, not the state. Put differently, the relentless increase in global resource throughput and environmental despoliation is not principally the result of states aspiring to a metric – higher GDP – but of industrial and financial firms, driven by market competition to expand turnover, develop new products, and increase profits and interest.
If the above analysis is correct, insofar as critical debates on growth focus solely on GDP while being coy about capital, they are enacting a form of displacement .
Abi , June 15, 2019 at 3:24 am
In writing a dissertation in 2014 I read Alchian's theory of the firm where he said cooperation is what fosters a peaceful condition for growth to occur, where as competition does the opposite. I've lived by that idea since, at least for us here in Lagos we have a chance to build a more cooperative and less competitive society
Sound of the Suburbs , June 15, 2019 at 4:18 am
If we were actually pursuing growth things would be a lot better.
The current goal is making money (capital accumulation).
What is this GDP thing anyway?
In the 1930s, they pondered over where all that wealth had gone to in 1929 and realised inflating asset prices doesn't create real wealth, they came up with the GDP measure to track real wealth creation in the economy.
The transfer of existing assets, like stocks and real estate, doesn't create real wealth and therefore does not add to GDP. The real wealth creation in the economy is measured by GDP.
Inflated asset prices aren't real wealth, and this can disappear almost over-night, as it did in 1929 and 2008.
The economics of globalisation precedes the GDP measure when they thought inflating asset prices created real wealth.
Real wealth creation involves real work, producing new goods and services in the economy.
We need an economics that focuses on GDP to grow GDP.
Neoclassical economics makes you think you are creating real wealth by inflating asset prices and we have been faffing about doing that.
The new scientific economics of globalisation = 1920's neoclassical economics with some complex maths on top.
skippy , June 15, 2019 at 4:30 am
Cambridge Controversy – ?????
Jos Oskam , June 15, 2019 at 4:57 am
" Distinctions must be kept in mind between quantity and quality of growth, between its costs and return, and between the short and the long term. Goals for more growth should specify more growth of what and for what "
This is not by me, but by the creator of the GDP formula, Simon Kuznets. GDP is a very poor indicator for many reasons, even apart from those mentioned above. Borrowing money and squandering it adds to GDP while the resulting debt is ignored. Extracting and burning fossil fuels adds to GDP while the future depletion is ignored. Stripmining and deforesting nature adds to GDP while you get my drift. To paraphrase Bastiat, the growth in GDP that is seen tends to mask decline in areas like nature and wellbeing that are not seen.
It is tragic to see politicians and pundits thoughtlessly raving about a few tenths of a percent change in GDP while never seeming to realize how poorly this represents things that are really important to humanity.
When will people stop worshipping at the GDP altar?
Steve Ruis , June 15, 2019 at 8:50 am
I might add that someone said back in the 60's that "growth for growth's sake is the philosophy of a cancer cell."
Ian Perkins , June 15, 2019 at 12:18 pm
BrainyQuote attributes it ("Growth for the sake of growth is the ideology of the cancer cell.") to Edward Abbey, who also came out with "Society is like a stew. If you don't stir it up every once in a while then a layer of scum floats to the top."
John Wright , June 15, 2019 at 11:54 pm
A variation on the theme, from https://en.wikiquote.org/wiki/Kenneth_Boulding
"Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist."
"Attributed to Kenneth Boulding in: United States. Congress. House (1973) Energy reorganization act of 1973: Hearings, Ninety-third Congress, first session, on H.R. 11510. p. 248"
The Rev Kev , June 15, 2019 at 5:46 am
Where the author says 'For much of the human story, societies were nomadic or semi-nomadic, and organized in immediate-return systems.' that is not entirely true that. Here I am thinking of the early Bantu in their expansion in Africa. Their wealth for them were in their cattle herds which being mobile, made possible the expansion of the Bantu down eastern Africa and into Southern Africa. These were long-term investments and Bantu society evolved to take care of these herds as they expanded. Your wealth in that society was in how many cattle you had.
I suppose when you think about it, the paradigm of growth works – to an extent – when there are more lands to discover, more continents to be opened up, more frontiers to be discovered. But all of that ran out a century ago and so with no more new resources to be found to be exploited, we have now reached the point where where we have come up hard against the natural limits of this planet. And yet, our economies still use the same mode of operating when we lived in an ever-expanding world. We are far beyond the point where we should have evolved into a closed-loop economy.
skippy , June 15, 2019 at 5:54 am
Cattle = Status.
The Rev Kev , June 15, 2019 at 6:22 am
More than that. For example. A young man could only really use cattle to be the dowry that he would need to attract a bride so cattle was a sign of his wealth. The status came with it. Cattle shaped their society immensely. Their villages were huge rings where the cattle would be locked in of a night and were called kraals. The people were so familiar with their cattle that a herdsman at a glance of a herd of several hundred cattle would be able to tell straight away if one were missing. It was a fascinating society.
Off The Street , June 15, 2019 at 8:17 am
On Wall Street, people used to ask Where are the client's yachts ?
As a sign of the times, now they can ask Where are the client's cattle, or hats ?
Dan , June 15, 2019 at 9:15 pm
The statement "For much of the human story, societies were nomadic or semi-nomadic, and organized in immediate-return systems" is absolutely true. Please see the book "Limited Wants, Unlimited Means" for a good primer. It includes an excerpt from Marshall Sahlins' "The Original Affluent Society" – a great introduction to hunter-gatherer societies. There is also a wonderful comparison of immediate return and delayed return societies as exemplified in the Hadza people, and the problems that arise once an immediate return society begins to settle, even minimally.
The Bantu evolved later and are agro-pastoralists, not foragers. The Hadza have persisted as foragers even after contact with the Bantu and other groups. They have also repeatedly resisted government and missionary efforts to introduce farming and Christianity. The Hadza are perhaps the best example of how human beings lived on earth for over 99% of our existence, that being in a largely cooperative, egalitarian manner, devoid of concepts such as wealth.
Abi , June 16, 2019 at 2:17 pm
Bantu people were not cattle herders, west central and much of Southern Africa is basically forest, there's no way in this world anyone could move herds this way; it's our northern brothers and sisters that are cattle herders. That being said, culturally we (Bantu) generally moved to set up new families/villages that's how we spread not through some farming technique, that's false
Ignacio , June 15, 2019 at 5:53 am
When I comment with someone, my wife for instance, about the need to get rid of GDP growth as the main political objective and think of small well being objectives I tipically receive commiseration in their eyes: "Yes Nacho, you are right, go and rest for a while"
animalogic , June 15, 2019 at 7:43 am
"I tipically receive commiseration in their eyes"
Its the burden of being right in the world of wrong.
Steven B kurtz , June 15, 2019 at 6:53 am
As usual, scale is ignored. In my (still living) 94 year old mother's lifetime, human population quadrupled. In large mammals, this is sometimes called "plague phase." Add a (minimally) tenfold increase in technological leverage in converting finite resources into infrastructure, food, transportation, consumable goods and services, and the increasingly rapid decline of the ecosphere is hardly a surprise. Dematerialization of the economy is a myth! And don't expect money printing or cyber tokens as solutions. They are simply power tools to access real stuff.
Godfree Roberts , June 15, 2019 at 7:22 am
Except China. Just sayin'
Wukchumni , June 15, 2019 at 7:40 am
One of the drivers of growth in the UK in the late 18th century that was missing, was money. It reached a crisis stage in 1797.
A chronic shortage of coins, silver specie in particular.
Then, the freebooters came to the rescue!
Silver 8 Reales coins plundered from the Spanish were reworked into being coins of the British realm & many other outposts in the colonies.
The first effort was pretty weak, all that was done was they were counterstamped with a small portrait of King George III upon the countenance of King Charles IIII, which led to this ditty:
"In order to enable the Spanish Dollar to pass, the head of a fool was struck on the neck of an ass."
Wukchumni , June 15, 2019 at 7:53 am
A couple of drivers of growth showed up both around the same time, the Haber Bosch process that allowed for pretty much unlimited food resources, and worldwide fiat money, which also had no limits to production.
We've quadrupled the world's population since these 2 events.
Ian Perkins , June 15, 2019 at 12:28 pm
The Haber-Bosch process allowed for a vast, but in no way unlimited, expansion of production.
Fiat money can be produced in unlimited amounts, but, according to both common sense and MMT, actual production also has actual limits.
Wukchumni , June 15, 2019 at 12:38 pm
Setting the world free from first gold and then silver restraints (the last silver coins issued for circulation in the 1st world was in 1969) allowed for a as much as you'd like fiat economy, beyond limits and also risk. (for now, that is)
For what it's worth, there has never been an instance of hyperinflation in the cyber money age.
Wukchumni , June 15, 2019 at 12:47 pm
Whoops, my bad. Germany issued silver 5 Mark coins for use in circulation until 1974, forgot about that.
Ian Perkins , June 15, 2019 at 1:10 pm
As much wood, steel and cement, or as many doctors, teachers and entertainers as you'd like, without limits, just because money can be printed without limits?
Wukchumni , June 15, 2019 at 1:18 pm
Money is only the lubricant, the ball bearings if you will. It has no agency over where it goes, other than in a tight circle.
Ian Perkins , June 15, 2019 at 1:38 pm
In a tight circle, or into a tight circle – aka the 0.1%?
Oregoncharles , June 15, 2019 at 4:26 pm
It's a fundamental issue: money is an abstraction that can increase without limits; the real world, the real economy, is not. MMT does address that, but I think it's a root source of the persistent inflation that plagued the economy until rather recently. Apparently the Fed, or somebody, can stop it if they wish. However, I think that that history is one reason for the resistance to MMT – it sounds like a formula for more inflation. Since it hasn't actually been tried as a policy (the Pentagon's limitless funds are really just corruption), we won't know for sure until it's tried. There always seems to be a lot that the economists don't know or won't admit.
deplorado , June 16, 2019 at 3:26 pm
Thuto , June 15, 2019 at 8:55 am
Politicians don't have the analytical tools to pick apart the "constant growth" argument so they default to trumpeting it as a cure for all social ills (no doubt with encouragement from mainstream economists). On the other end of the spectrum, the growth story seduces ordinary people because they're told their share of the spoils, courtesy of the trickling down effect, will lead them to a "better life". As such, nothing short of a massive ideological decolonization effort is needed to strip growth of the superhero status it enjoys in contemporary economic discourse.
Norb , June 15, 2019 at 1:27 pm
The only positive hope is that enough people take it upon themselves to rise to the occasion. People who have freed themselves from the tyranny of the current economic system need to be examples for others to follow. Those that can, must change their lifestyles. They indirectly become leaders by example.
There is a spiritual component in this transformation that has not really surfaced yet, but feels like it is stirring under the surface. There is so much denial going on that something will burst forth. What form that takes is anyones guess, but most people are just looking for leadership when pressed.
Instead of the neoliberal message of selfish pursuits lead to a better life, the message of self-sacrifice and service to something greater resonates with most people. Instead of being just lip-service or propaganda, this sentiment must be channeled into concrete policies and actions- beginning with oneself.
Underlying all this is the need for peace. The Big Lie of growth pales in comparison to the Big Lie of perpetual war. Both lies reinforce each other.
How to explain the conflict between capitalists and well, all the rest, other than a spiritual war. Where does one place ones faith? Violent and selfish Nationalism will not suffice.
Strength in humility instead of conquest is the dividing line. The decolonization of the human mind must be followed by an awareness and consciousness that the world is here to live in, not conquer. That is an enormous shift in human action and consciousness- those that live this ideal must be valued and emulated.
The attempt must be made- is being made.
Carolinian , June 15, 2019 at 8:59 am
The growth paradigm, I suggest, is a form of fetishistic consciousness.
Elsewhere today Lambert talks about religion as Marx's "opiate of the people" but there are many versions of that drug and our secular overlords seem to have replaced the Bible with other unquestioned assumptions, many of them economic. Perhaps at some point rationality has its limits and illusions of some kind of are necessary to make the engine go. The problem unfortunately is that the current engineers seem to believe those illusions themselves and follow them blindly. They are addicts too. Is it time to "just say no"?
lyman alpha blob , June 15, 2019 at 10:13 am
Good essay. The author gets the the heart of it with this –
The evolution of the growth paradigm was integrally connected to the capitalist system and its colonial thrusts. The basic link between the growth drive and capitalism is transparent. The latter is a system of competitive accumulation. The former, in suggesting that the system is natural and brings benefit also to the '99%', provides ideological cover in that growth serves as an idealised and democratised redescription of capital accumulation.
– where the theory of growth is an attempt to rationalize the greed of the few who really like playing capitalist at the expense of everyone else. How about they get their jollies playing Monopoly and leave the rest of us alone?
I'll just leave this here, a beautiful tune by one of my favorite bands, Old Crow Medicine Show. Four minutes that will make you feel better after reading of all the nastiness in the world, and very apropos to this article –
Ain't It Enough?
hemeantwell , June 15, 2019 at 12:52 pm
I agree with the thrust of your comment but
is an attempt to rationalize the greed of the few who really like playing capitalist at the expense of everyone else.
As noxious as their displays of wealth are, and as much as it's possible to make a case that pathological narcissism infuses the system, the motive to accumulate to compete with rivals, current and future, is central. It's politically useful to attack the way that this motive draws others into its van, i.e. to make them personally despicable. But it might be worthwhile to consider how much the accumulation motive is embodied as a kind of social contract in the firm's organization. I imagine that individual capitalists say to themselves "I've made my pile, time to sail away in my yacht," but the firm and those who will stay on want to keep things going.
rod , June 15, 2019 at 11:12 am
. The moral economy of sharing necessitates a muscular egalitarianism that is undermined by the accumulation of property.
this really stuck out to me.
and I can't really identify why, however I couldn't stop thinking about the growing proliferation of plastic while reading the article
David J. , June 15, 2019 at 12:01 pm
Back in the early 80s, the professor for whom I was a grad assistant frequently urged me to read Canetti's "Crowds and Power." It's a powerful and useful book. Well-written and accessible and full of thought-provoking ideas. I'd recommend it for anyone who wants to ponder social relations.
In this case, Dale seems to use Canetti's book as a kind of straw-man entry to his real topic:an intro to his discussion of growth/degrowth. I guess you gotta start somewhere? Maybe he should have simply directly referenced Canetti on his notion of "feast crowds" (pg 62 of my edition of Crowds and Power.)
The above comments by Sound of the Suburbs and Joe Oskam are incisive, imo. The essence of the matter boils down to developing a more rigorous distinction (and understanding) of the difference between productive economic activity and non-productive economic activity. Hudson is really good on this.
Wukchumni , June 15, 2019 at 12:17 pm
Go back further and Gustave Le Bon's The Crowd from 1896 ages well, because human motives don't change much
"The masses have never thirsted after truth. Whoever can supply them with illusions is easily their master; whoever attempts to destroy their illusions is always their victim."
"A crowd thinks in images, and the image itself calls up a series of other images, having no logical connection with the first A crowd scarcely distinguishes between the subjective and the objective. It accepts as real the images invoked in its mind, though they most often have only a very distant relation with the observed facts .Crowds being only capable of thinking in images are only to be impressed by images."
"We see, then, that the disappearance of the conscious personality, the predominance of the unconscious personality, the turning by means of suggestion and contagion of feelings and ideas in an identical direction, the tendency to immediately transform the suggested ideas into acts; these, we see, are the principal characteristics of the individual forming part of a crowd. He is no longer himself, but has become an automaton who has ceased to be guided by his will."
JEHR , June 15, 2019 at 1:16 pm
As I read these quoted words it is hard not to think of the crowds that surround Trump on his so-called "rallies" for his base. One cannot but help ask, Why is anyone listening to this man? Ans: "He is no longer himself, but has become an automaton who has ceased to be guided by his will."
Norb , June 15, 2019 at 3:06 pm
What makes the masses the masses is that they are followers. This is a double edged sword the elite exploit relentlessly- that is what makes them the elite. They hold the power, and desire, to manipulate the masses through narrative and image. These stories and images make the world and human experience comprehensible. When corruption sinks in, that whole group is doomed to eventual failure if a self-correcting mechanism is not present. Leaders/elite and masses both fail.
It is very self-serving for the elite to blame the masses when the "illusions" stop working their magic. Have the elite ever "thirsted after truth" either? Truth meaning a universal truth applicable to all, or the Truth embodied in a personal view as apposed to a public view? Such Truths tend to obfuscate the drive for personal power, which doesn't sit well within groups of people let alone groups of differing cultural or ethnic experiences.
Manipulation of the masses is not the problem, it is manipulation to what end that is the issue. In that respect, the elite leadership should take more responsibility and bear a greater portion of blame for failure- for in fact, they are driving the whole process.
In a nutshell, this is the failure of the current human situation. A greedy elite incapable or unwilling to use the powers at hand to bring about a fair and equatable world. It is just too easy for them to continue their deceitful manipulations and blame hapless or trusting victims.
Another way is for the elite leadership to listen to the people/masses and take their needs and desires into account when molding public opinion. Such an elite will foster the population's wellbeing, not fear them or treat them as a mob. That process makes the elite leadership legitimate.
The most stupid leadership is one that fails to change course when the images and narratives moving its society are failing. The whole society becomes weak and ineffective on multiple levels.
At some point, the factional fighting must stop. It seems inevitable that human society will rebalance itself to manageable levels. The question becomes how violent that transition will be.
hemeantwell , June 15, 2019 at 6:31 pm
LeBon writes of crowds as though there is a complete discontinuity between a person's thought and behavior when they are in a crowd and when they are not. That's nonsense, a cocktail party generalization. I've been in plenty of political crowds and the remarkable transformation he purports was not evident. Le Bon was a rank conservative and his analysis reflected his detestation of the French left, fueled by his experience of the Commune. He's writing in a way that helps justify the massacres that concluded it.
Ian Perkins , June 15, 2019 at 12:04 pm
I often wondered about this fetishisation of growth in GDP (I'm in my sixties now), when in developed countries it seemed to have as many negatives as positives.
Then I realised that capital, in its most general sense, doesn't invest in the hope of getting its money back, but in the hope of its money back plus some more . The only way that can carry on for very long is through growth.
I'm not an economist, but that explanation really rang true for me.
notabanktoadie , June 15, 2019 at 12:59 pm
Usury based finance REQUIRES growth to pay the interest.
Why then government privileges for private credit creation?
nothing but the truth , June 16, 2019 at 10:36 am
by infinite growth they actually mean infinite growth of debt, which is required for the current financial system to survive.
Oregoncharles , June 15, 2019 at 4:37 pm
One answer: CASSE, Center for the Advancement of the Steady State Economy, Herman Daly's legacy. https://steadystate.org/ .
Susan the other` , June 15, 2019 at 5:20 pm
Just Thank You. Thank You tons. I will remember the name Gareth Dale and The Ecologist. And the reference to the (unexplained) runaway condition of human economics as "Capitalist Time" v. (of course) real time. Because as we have learned here at NC "financial time goes much faster than real time." And etc. This essay was wonderful, and now we have an outline of why that is true.
John Wright , June 16, 2019 at 12:08 am
From the text:
"roughly speaking when per capita GDP exceeds $15,000. At higher levels, the translation of growth into improvements in health and well-being is tenuous."
The implications of this statement are large, for it multiplies out to a US GDP of 330E6 x 15E3 = 4.95 Trillion or about ONE FOURTH of the current USA economic output (19.39 trillion in 2017).
Forget the Green New Deal, shrink economic output by 3/4 in the USA while drastically lowering inequality to share the shrunken economic pie and one should observe a large positive effect on future climate change while having a reasonable USA citizen well-being,.
Jun 14, 2019 | www.amazon.com
From the Introduction
... ... ...
Mean Girls, which was based on interviews with high school girls conducted by Rosalind Wiseman for her 2002 book Queen Bees and War/tubes, reflects the emotional atmosphere of the age of the Plastics (as the most popular girls at Actional North Shore High are called), as well as the era of Wall Street's Gordon Gekko, whose motto is “Greed is Good.”1 The culture of greed is the hallmark of the neoliberal era, the period beginning in the 1970s when the protections of the U.S. and European welfare states, and the autonomy of postcolonial states around the world, came under attack. Advocates of neoliberalism worked to reshape global capitalism by freeing transnational corporations from restrictive forms of state regulation, stripping away government efforts to redistribute wealth and provide public services, and emphasizing individual responsibility over social concern.
From the 1980s to 2008, neoliberal politics and policies succeeded in expanding inequality around the world. The political climate Ayn Rand celebrated—the reign of brutal capitalism—intensified. Though Ayn Rand’s popularity took off in the 1940s, her reputation took a dive during the 1960s and ’70s. Then after her death in 1982, during the neoliberal administrations of Ronald Reagan in the United States and Margaret Thatcher in the United Kingdom, her star rose once more. (See chapter 4 for a full discussion of the rise of neoliberalism.)
During the global economic crisis of 2008 it seemed that the neoliberal order might collapse. It lived on, however, in zombie form as discredited political policies and financial practices were restored. But neoliberal capitalism has always been contested, and competing and conflicting political ideas and organizations proliferated and intensified after 2008 as well.
Protest politics blossomed on the left with Occupy Wall Street, Black Lives Matter, and opposition to the Dakota Access oil pipeline at the Standing Rock Sioux reservation in the United States, and with the Arab Spring, and other mobilizations around the world. Anti-neoliberal electoral efforts, like the Bernie Sanders campaign for the U.S. presidency, generated excitement as well.
But protest and organizing also expanded on the political right, with reactionary populist, racial nationalist, and protofascist gains in such countries as India, the Philippines, Russia, Hungary, and the United States rapidly proliferating. Between these far-right formations on the one side and persistent zombie neoliberalism on the other, operating sometimes at odds and sometimes in cahoots, the Season of Mean is truly upon us.
We are in the midst of a major global, political, economic, social, and cultural transition — but we don’t yet know which way we’re headed. The incoherence of the Trump administration is symptomatic of the confusion as politicians and business elites jockey with the Breitbart alt-right forces while conservative evangelical Christians pull strings. The unifying threads are meanness and greed, and the spirit of the whole hodgepodge is Ayn Rand.
Rand’s ideas are not the key to her influence. Her writing does support the corrosive capitalism at the heart of neoliberalism, though few movers and shakers actually read any of her nonfiction. Her two blockbuster novels, 'The Fountainpen and Atlas Shrugged, are at the heart of her incalculable impact. Many politicians and government officials going back decades have cited Rand as a formative influence—particularly finance guru and former Federal Reserve chairman Alan Greenspan, who was a member of Rand's inner circle, and Ronald Reagan, the U.S. president most identified with the national embrace of neoliberal policies.
Major figures in business and finance are or have been Rand fans: Jimmy Wales (Wikipedia), Peter Thiel (Paypal), Steve Jobs (Apple), John Mackey (Whole Foods), Mark Cuban (NBA), John Allison (BB&T Banking Corporation), Travis Kalanik (Uber), Jelf Bezos (Amazon), ad infinitum.
There are also large clusters of enthusiasts for Rand’s novels in the entertainment industry, from the 1940s to the present—from Barbara Stanwyck, Joan Crawford, and Raquel Welch to Jerry Lewis, Brad Pitt, Angelina Jolie, Rob Lowe, Jim Carrey, Sandra Bullock, Sharon Stone, Ashley Judd, Eva Mendes, and many more.
The current Trump administration is stuffed to the gills with Rand acolytes. Trump himself identifies with Fountainhead character Howard Roark; former secretary of state Rex Tillerson listed Adas Shrugged as his favorite book in a Scouting magazine feature; his replacement Mike Pompeo has been inspired by Rand since his youth. Ayn Rand’s influence is ascendant across broad swaths of our dominant political culture — including among public figures who see her as a key to the Zeitgeist, without having read a worth of her writing.’’
But beyond the famous or powerful fans, the novels have had a wide popular impact as bestsellers since publication. Along with Rand’s nonfiction, they form the core texts for a political/ philosophical movement: Objectivism. There are several U.S.- based Objectivist organizations and innumerable clubs, reading groups, and social circles. A 1991 survey by the Library of Congress and the Book of the Month Club found that only the Bible had influenced readers more than Atlas Shrugged, while a 1998 Modern Library poll listed The Fountainhead and Atlas Shrugged as the two most revered novels in English.
Atlas Shrugged in particular skyrocketed in popularity in the wake of the 2008 financial crash. The U.S. Tea Party movement, founded in 2009, featured numerous Ayn Rand—based signs and slogans, especially the opening line of Atlas Shrugged: “Who is John Galt?” Republican pundit David Frum claimed that the Tea Party was reinventing the GOP as “the party of Ayn Rand.” During 2009 as well, sales of Atlas Shrugged tripled, and GQ_magazine called Rand the year’s most influential author. A 2010 Zogby poll found that 29 percent of respondents had read Atlas Shrugged, and half of those readers said it had affected their political and ethical thinking.
In 2018, a business school teacher writing in Forbes magazine recommended repeat readings: “Recent events — the bizarro circus that is the 2016 election, the disintegration of Venezuela, and so on make me wonder if a lot of this could have been avoided bad we taken Atlas Shrugged's message to heart. It is a book that is worth re-reading every few years.”3
Rand biographer Jennifer Burns asserts simply that Ayn Rand's fiction is “the gateway drug” to right-wing politics in the United States — although her influence extends well beyond the right wing.4
But how can the work of this one novelist (also an essayist, playwright, and philosopher), however influential, be a significant source of insight into the rise of a culture of greed? In a word: sex. Ayn Rand made acquisitive capitalists sexy. She launched thousands of teenage libidos into the world of reactionary politics on a wave of quivering excitement. This sexiness extends beyond romance to infuse the creative aspirations, inventiveness, and determination of her heroes with erotic energy, embedded in what Rand called her “sense of life.” Analogous to what Raymond Williams has called a “structure of feeling,” Rand’s sense of life combines the libido-infused desire for heroic individual achievement with contempt for social inferiors and indifference to their plight.5
Lauren Berlant has called the structure of feeling, or emotional situation, of those who struggle for a good life under neoliberal conditions “cruel optimism”—the complex of feelings necessary to keep plugging away hopefully despite setbacks and losses.'’ Rand's contrasting sense of life applies to those whose fantasies of success and domination include no doubt or guilt. The feelings of aspiration and glee that enliven Rand’s novels combine with contempt for and indifference to others. The resulting Randian sense of life might be called “optimistic cruelty.” Optimistic cruelty is the sense of life for the age of greed.
Ayn Rand’s optimistic cruelty appeals broadly and deeply through its circulation of familiar narratives: the story of “civilizational” progress, die belief in American exceptionalism, and a commitment to capitalist freedom.
Her novels engage fantasies of European imperial domination conceived as technological and cultural advancement, rather than as violent conquest. America is imagined as a clean slate for pure capitalist freedom, with no indigenous people, no slaves, no exploited immigrants or workers in sight. The Fountainhead and especially Atlas Shrugged fabricate history and romanticize violence and domination in ways that reflect, reshape, and reproduce narratives of European superiority' and American virtue.
Their logic also depends on a hierarchy of value based on radicalized beauty and physical capacity — perceived ugliness or disability' are equated with pronounced worthlessness and incompetence.
Through the forms of romance and melodrama, Rand novels extrapolate the story of racial capitalism as a story of righteous passion and noble virtue. They retell The Birth of a Ntation through the lens of industrial capitalism (see chapter 2). They solicit positive identification with winners, with dominant historical forces. It is not an accident that the novels’ fans, though gender mixed, are overwhelmingly white Americans of the professional, managerial, creative, and business classes."
aslan , June 1, 2019devastating account of the ethos that shapes contemporary AmericaWreck2 , June 1, 2019
Ayn Rand is a singular influence on American political thought, and this book brilliantly unfolds how Rand gave voice to the ethos that shapes contemporary conservatism. Duggan -- whose equally insightful earlier book Twilight of Equality offered an analysis of neoliberalism and showed how it is both a distortion and continuation of classical liberalism -- here extends the analysis of American market mania by showing how an anti-welfare state ethos took root as a "structure of feeling" in American culture, elevating the individual over the collective and promoting a culture of inequality as itself a moral virtue.
Although reviled by the right-wing press (she should wear this as a badge of honor), Duggan is the most astute guide one could hope for through this devastating history of our recent past, and the book helps explain how we ended up where we are, where far-right, racist nationalism colludes (paradoxically) with libertarianism, an ideology of extreme individualism and (unlikely bed fellows, one might have thought) Silicon Valley entrepreneurship.
This short, accessible book is essential reading for everyone who wants to understand the contemporary United States.contemporary crueltykerwynk , June 2, 2019
Does the pervasive cruelty of today's ruling classes shock you? Or, at least give you pause from time to time? Are you surprised by the fact that our elected leaders seem to despise people who struggle, people whose lives are not cushioned and shaped by inherited wealth, people who must work hard at many jobs in order to scrape by? If these or any of a number of other questions about the social proclivities of our contemporary ruling class detain you for just two seconds, this is the book for you.
Writing with wit, rigor, and vigor, Lisa Duggan explains how Ayn Rand, the "mean girl," has captured the minds and snatched the bodies of so very many, and has rendered them immune to feelings of shared humanity with those whose fortunes are not as rosy as their own. An indispensable work, a short read that leaves a long memory.Valuable and insightful commentary on Rand and Rand's influence on today's world
Mean Girl offers not only a biographical account of Rand (including the fact that she modeled one of her key heroes on a serial killer), but describes Rand's influence on neoliberal thinking more generally.
As Duggan makes clear, Rand's influence is not just that she offered a programmatic for unregulated capitalism, but that she offered an emotional template for "optimistic cruelty" that has extended far beyond its libertarian confines. Mean Girl is a fun, worthwhile read!
Sister, June 3, 2019
Superb poitical and cultural exploration of Rand's influence
Lisa Duggan's concise but substantive look at the political and cultural influence of Ayn Rand is stunning. I feel like I've been waiting most of a lifetime for a book that is as wonderfully readable as it is insightful. Many who write about Rand reduce her to a caricature hero or demon without taking her, and the history and choices that produced her seriously as a subject of cultural inquiry. I am one of those people who first encountered Rand's books - novels, but also some nonfiction and her play, "The Night of January 16th," in which audience members were selected as jurors – as a teenager.
Under the thrall of some right-wing locals, I was so drawn to Rand's larger-than-life themes, the crude polarization of "individualism" and "conformity," the admonition to selfishness as a moral virtue, her reductive dismissal of the public good as "collectivism."
Her work circulated endlessly in those circles of the Goldwater-ite right. I have changed over many years, and my own life experiences have led me to reject the casual cruelty and vicious supremacist bent of Rand's beliefs.
But over those many years, the coterie of Rand true believers has kept the faith and expanded. One of the things I value about Duggan's compelling account is her willingness to take seriously the far reach of Rand's indifference to human suffering even as she strips away the veneer that suggests Rand's beliefs were deep.
In fact, though her views are deeply-seated, Rand is, at heart, a confidence artist, appealing only to narrow self-interest at the expense of the well-being of whole societies.
I learned that the hard way, but I learned it. Now I am recommending Duggan's wise book to others who seek to understand today's cultural and political moment in the United States and the rise of an ethic of indifference to anybody but the already affluent. Duggan is comfortable with complexity; most Randian champions or detractors are not.
Mar 16, 2018 | www.amazon.com
Hardcover: 400 pages
Publisher: Harvard University Press (March 16, 2018)
...The second explanation was that neoliberal globalization made a small number of people very rich, and it was in the interest of those people to promote a self-serving ideology using their substantial means by funding think tanks and academic departments, lobbying congress, fighting what the Heritage Foundation calls "the war of ideas." Neoliberalism, then, was a restoration of class power after the odd, anomalous interval of the mid-century welfare state.
There is truth to both of these explanations. Both presuppose a kind of materialist explanation of history with which I have no problem. In my book, though, I take another approach. What I found is that we could not understand the inner logic of something like the WTO without considering the whole history of the twentieth century. What I also discovered is that some of the members of the neoliberal movement from the 1930s onward, including Friedrich Hayek and Ludwig von Mises, did not use either of the explanations I just mentioned. They actually didn't say that economic growth excuses everything. One of the peculiar things about Hayek, in particular, is that he didn't believe in using aggregates like GDP -- the very measurements that we need to even say what growth is.
What I found is that neoliberalism as a philosophy is less a doctrine of economics than a doctrine of ordering -- of creating the institutions that provide for the reproduction of the totality [of financial elite control of the state]. At the core of the strain I describe is not the idea that we can quantify, count, price, buy and sell every last aspect of human existence. Actually, here it gets quite mystical. The Austrian and German School of neoliberals in particular believe in a kind of invisible world economy that cannot be captured in numbers and figures but always escapes human comprehension.
After all, if you can see something, you can plan it. Because of the very limits to our knowledge, we have to default to ironclad rules and not try to pursue something as radical as social justice, redistribution, or collective transformation. In a globalized world, we must give ourselves over to the forces of the market, or the whole thing will stop working.
So this is quite a different version of neoliberal thought than the one we usually have, premised on the abstract of individual liberty or the freedom to choose. Here one is free to choose but only within a limited range of options left after responding to the global forces of the market.
One of the core arguments of my book is that we can only understand the internal coherence of neoliberalism if we see it as a doctrine as concerned with the whole as the individual. Neoliberal globalism can be thought of in its own terms as a negative theology, contending that the world economy is sublime and ineffable with a small number of people having special insight and ability to craft institutions that will, as I put it, encase the sublime world economy.
To me, the metaphor of encasement makes much more sense than the usual idea of markets set free, liberated or unfettered. How can it be that in an era of proliferating third party arbitration courts, international investment law, trade treaties and regulation that we talk about "unfettered markets"? One of the big goals of my book is to show neoliberalism is one form of regulation among many rather than the big Other of regulation as such.
What I explore in Globalists is how we can think of the WTO as the latest in a long series of institutional fixes proposed for the problem of emergent nationalism and what neoliberals see as the confusion between sovereignty -- ruling a country -- and ownership -- owning the property within it.
I build here on the work of other historians and show how the demands in the United Nations by African, Asian, and Latin American nations for things like the Permanent Sovereignty over Natural Resources, i.e. the right to nationalize foreign-owned companies, often dismissed as merely rhetorical, were actually existentially frightening to global businesspeople.
They drafted neoliberal intellectuals to do things like craft agreements that gave foreign corporations more rights than domestic actors and tried to figure out how to lock in what I call the "human right of capital flight" into binding international codes. I show how we can see the development of the WTO as largely a response to the fear of a planned -- and equal -- planet that many saw in the aspirations of the decolonizing world.
Perhaps the lasting image of globalization that the book leaves is that world capitalism has produced a doubled world -- a world of imperium (the world of states) and a world of dominium (the world of property). The best way to understand neoliberal globalism as a project is that it sees its task as the never-ending maintenance of this division. The neoliberal insight of the 1930s was that the market would not take care of itself: what Wilhelm Röpke called a market police was an ongoing need in a world where people, whether out of atavistic drives or admirable humanitarian motives, kept trying to make the earth a more equal and just place.
The culmination of these processes by the 1990s is a world economy that is less like a laissez-faire marketplace and more like a fortress, as ever more of the world's resources and ideas are regulated through transnational legal instruments. The book acts as a kind of field guide to these institutions and, in the process, hopefully recasts the 20th century that produced them.
Mark bennettJesper Doepping
One half of a decent book
3.0 out of 5 stars One half of a decent book May 14, 2018 Format: Hardcover Verified Purchase This is a rather interesting look at the political and economic ideas of a circle of important economists, including Hayek and von Mises, over the course of the last century. He shows rather convincingly that conventional narratives concerning their idea are wrong. That they didn't believe in a weak state, didn't believe in the laissez-faire capitalism or believe in the power of the market. That they saw mass democracy as a threat to vested economic interests.
The core beliefs of these people was in a world where money, labor and products could flow across borders without any limit. Their vision was to remove these subjects (tariffs, immigration and controls on the movement of money) from the control of the democracy-based nation-state and instead vesting them in international organizations. International organizations which were by their nature undemocratic and beyond the influence of democracy. That rather than rejecting government power, what they rejected was national government power. They wanted weak national governments but at the same time strong undemocratic international organizations which would gain the powers taken from the state.
The other thing that characterized many of these people was a rather general rejection of economics. While some of them are (at least in theory) economists, they rejected the basic ideas of economic analysis and economic policy. The economy, to them, was a mystical thing beyond any human understanding or ability to influence in a positive way. Their only real belief was in "bigness". The larger the market for labor and goods, the more economically prosperous everyone would become. A unregulated "global" market with specialization across borders and free migration of labor being the ultimate system.
The author shows how, over a period extending from the 1920s to the 1990s, these ideas evolved from marginal academic ideas to being dominant ideas internationally. Ideas that are reflected today in the structure of the European Union, the WTO (World Trade Organization) and the policies of most national governments. These ideas, which the author calls "neoliberalism", have today become almost assumptions beyond challenge. And even more strangely, the dominating ideas of the political left in most of the west.
The author makes the point, though in a weak way, that the "fathers" of neoliberalism saw themselves as "restoring" a lost golden age. That golden age being (roughly) the age of the original industrial revolution (the second half of the 1800s). And to the extent that they have been successful they have done that. But at the same time, they have brought back all the political and economic questions of that era as well.
In reading it, I started to wonder about the differences between modern neoliberalism and the liberal political movement during the industrial revolution. I really began to wonder about the actual motives of "reform" liberals in that era. Were they genuinely interested in reforms during that era or were all the reforms just cynical politics designed to enhance business power at the expense of other vested interests. Was, in particular, the liberal interest in political reform and franchise expansion a genuine move toward political democracy or simply a temporary ploy to increase their political power. If one assumes that the true principles of classic liberalism were always free trade, free migration of labor and removing the power to governments to impact business, perhaps its collapse around the time of the first world war is easier to understand.
He also makes a good point about the EEC and the organizations that came before the EU. Those organizations were as much about protecting trade between Europe and former European colonial possessions as they were anything to do with trade within Europe.
To me at least, the analysis of the author was rather original. In particular, he did an excellent job of showing how the ideas of Hayek and von Mises have been distorted and misunderstood in the mainstream. He was able to show what their ideas were and how they relate to contemporary problems of government and democracy.
But there are some strong negatives in the book. The author offers up a complete virtue signaling chapter to prove how the neoliberals are racists. He brings up things, like the John Birch Society, that have nothing to do with the book. He unleashes a whole lot of venom directed at American conservatives and republicans mostly set against a 1960s backdrop. He does all this in a bad purpose: to claim that the Kennedy Administration was somehow a continuation of the new deal rather than a step toward neoliberalism. His blindness and modern political partisanship extended backward into history does substantial damage to his argument in the book. He also spends an inordinate amount of time on the political issues of South Africa which also adds nothing to the argument of the book. His whole chapter on racism is an elaborate strawman all held together by Ropke. He also spends a large amount of time grinding some sort of Ax with regard to the National Review and William F. Buckley.
He keeps resorting to the simple formula of finding something racist said or written by Ropke....and then inferring that anyone who quoted or had anything to do with Ropke shared his ideas and was also a racist. The whole point of the exercise seems to be to avoid any analysis of how the democratic party (and the political left) drifted over the decades from the politics of the New Deal to neoliberal Clintonism.
Then after that, he diverts further off the path by spending many pages on the greatness of the "global south", the G77 and the New International Economic Order (NIEO) promoted by the UN in the 1970s. And whatever many faults of neoliberalism, Quinn Slobodian ends up standing for a worse set of ideas: International Price controls, economic "reparations", nationalization, international trade subsidies and a five-year plan for the world (socialist style economic planning at a global level). In attaching himself to these particular ideas, he kills his own book. The premise of the book and his argument was very strong at first. But by around p. 220, its become a throwback political tract in favor of the garbage economic and political ideas of the so-called third world circa 1974 complete with 70's style extensive quotations from "Senegalese jurists"
Once the political agenda comes out, he just can't help himself. He opens the conclusion to the book taking another cheap shot for no clear reason at William F. Buckley. He spends alot of time on the Seattle anti-WTO protests from the 1990s. But he has NOTHING to say about BIll Clinton or Tony Blair or EU expansion or Obama or even the 2008 economic crisis for that matter. Inexplicably for a book written in 2018, the content of the book seems to end in the year 2000.
I'm giving it three stars for the first 150 pages which was decent work. The second half rates zero stars. Though it could have been far better if he had written his history of neoliberalism in the context of the counter-narrative of Keynesian economics and its decline. It would have been better yet if the author had the courage to talk about the transformation of the parties of the left and their complicity in the rise of neoliberalism. The author also tends to waste lots of pages repeating himself or worse telling you what he is going to say next. One would have expected a better standard of editing by the Harvard Press. Read less 69 people found this helpful Helpful Comment Report abuseJackal
A concise definition of neoliberalism and its historical influence
5.0 out of 5 stars A concise definition of neoliberalism and its historical influence November 14, 2018 Format: Kindle Edition Verified Purchase Anybody interested in global trade, business, human rights or democracy today should read this book.
The book follow the Austrians from the beginning in the Habsburgischer empire to the beginning rebellion against the WTO. However, most importantly it follows the thinking and the thoughts behind the building of a global empire of capitalism with free trade, capital and rights. All the way to the new "human right" to trade. It narrows down what neoliberal thought really consist of and indirectly make a differentiation to the neoclassical economic tradition.
What I found most interesting is the turn from economics to law - and the conceptual distinctions between the genes, tradition, reason, which are translated into a quest for a rational and reason based protection of dominium (the rule of property) against the overreach of imperium (the rule of states/people). This distinction speaks directly to the issues that EU is currently facing.
A historian with an agenda
3.0 out of 5 stars A historian with an agenda October 22, 2018 Format: Hardcover Author is covering Mises, Hayek, Machlup in Vienna. How to produce order once the Habsburg empire had been broken after 1918? They pioneered data gathering about the economy. However, such data came to be used by the left as well. This forced the people mentioned to become intellectual thinkers as opposed to something else(??). I like how the author is situating the people in a specific era, but he is reading history backwards. The book moves on, but stays in Central Europe. Ordocapitalism followed after Hitler. It was a German attempt to have a both strong state and strong by market, which given Europe's fragmentation required international treaties. This was seen as a way to avoid another Hitler. Later, international organisations like IMF and TWO became the new institutions that embedded the global markets. The book ends in the 90s. So in reading history backwards, the author finds quotations of Mises and Hayek that "prove" that they were aiming to create intellectual cover for the global financial elite of the 2010s.
Nevertheless, the book is interesting if you like the history of ideas. He frames the questions intelligently in the historical context at the time. However a huge question-mark for objectivity. The book is full of lefty dog whistles: the war making state, regulation of capitalism, reproducing the power of elites, the problem [singular] of capitalism. In a podcast the author states point blank "I wanted the left to see what the enemy was up too". I find it pathetic that authors are so blatantly partisan. How can we know whether he is objective when he doesn't even try? He dismissively claims that the neoliberal thinkers gave cover to what has become the globalist world order. So why should we not consider the current book as intellectual cover for some "new left" that is about to materialise? Maybe the book is just intellectual cover for the globalist elite being educated in left-wing private colleges.
Jun 11, 2019 | www.moonofalabama.org
MG , Jun 11, 2019 8:40:24 AM | 129
You stated, "Let's also ignore the fact that the sons and grandsons of the unionised postwar generation for the most part subsequently rejected blue collar work no matter what the pay. This is a sign of decadence I will grant you, and I am guilty as charged. "
This canard doesn't hold up in the face of empirical evidence. One example: 20,000 waiting in line for lousy warehouse jobs at Amazon. The fact is, open borders and illegal immigration are NeoLiberal tactics to promote wage arbitrage. In California, those impacted the most by illegal immigration are African Americans. Whole sectors, such as hotel maintenance and janitorial service, had been unionized, and had principally employed black workers whose salaries enabled them to move into the middle class. The hotel industry welcomed the influx of illegal immigrants willing to work for drastically lower wages. Black workers were replaced and the union destroyed. Unfortunately, many in the US and globally have been so propagandized about illegal immigration that even mentioning illegal immigration gets one falsely labeled racist. in the US, Democrats use illegal immigration as a "demographic strategy," which enables Democrats to remain in power while remaining wholly loyal to Wall Street and doing nothing to ameliorate the misery of the bottom 90%.
Jun 10, 2019 | turcopolier.typepad.com
Timothy Hagios , 09 June 2019 at 01:49 PMOn the bright side, if ever there were a candidate who might be inclined to rethink our relationship with the Saudis, it's Buttigieg.
Oh, who am I kidding? He would be given a lavish reception in Riyadh, where he would deliver a speech thanking our Saudi allies for leading the brave fight against "Iranian homophobia."
Jun 10, 2019 | www.zerohedge.com
Bam_Man , 3 hours ago linkGreenspazm , 1 hour ago link
One year ago, EVERYBODY was a bond "bear", predicting a long string of rate hikes that would bring Fed Funds up to 4.50%.
They were ALL wrong. VERY wrong.
They are probably just as wrong now that they are bond "bulls".Bam_Man , 1 hour ago link
No, if you use kimble charting technical analysis you will get very rich.
Jun 04, 2019 | archive.foThe disappearance of the Soviet Union left a big hole. The "war on terror" was an inadequate replacement. But China ticks all boxes. For the US, it can be the ideological, military and economic enemy many need. Here at last is a worthwhile opponent. That was the main conclusion I drew from this year's Bilderberg meetings.
Across-the-board rivalry with China is becoming an organising principle of US economic, foreign and security policies.
Whether it is Donald Trump's organizing principle is less important. The US president has the gut instincts of a nationalist and protectionist. Others provide both framework and details. The aim is US domination. The means is control over China, or separation from China.
Anybody who believes a rules-based multilateral order, our globalised economy, or even harmonious international relations, are likely to survive this conflict is deluded. The astonishing white paper on the trade conflict , published on Sunday by China, is proof. The -- to me, depressing -- fact is that on many points Chinese positions are right.
The US focus on bilateral imbalances is economically illiterate. The view that theft of intellectual property has caused huge damage to the US is questionable . The proposition that China has grossly violated its commitments under its 2001 accession agreement to the World Trade Organization is hugely exaggerated.
Accusing China of cheating is hypocritical when almost all trade policy actions taken by the Trump administration are in breach of WTO rules, a fact implicitly conceded by its determination to destroy the dispute settlement system .
The US negotiating position vis-ŕ-vis China is that "might makes right". This is particularly true of insisting that the Chinese accept the US role as judge, jury and executioner of the agreement .
A dispute over the terms of market opening or protection of intellectual property might be settled with careful negotiation. Such a settlement might even help China, since it would lighten the heavy hand of the state and promote market-oriented reform.
But the issues are now too vexed for such a resolution. This is partly because of the bitter breakdown in negotiation. It is still more because the US debate is increasingly over whether integration with China's state-led economy is desirable. The fear over Huawei focuses on national security and technological autonomy.
[Neo]liberal commerce is increasingly seen as "trading with the enemy".
A framing of relations with China as one of zero-sum conflict is emerging. Recent remarks by Kiron Skinner, the US state department's policy planning director (a job once held by cold war strategist George Kennan) are revealing. Rivalry with Beijing, she suggested at a forum organised by New America , is "a fight with a really different civilisation and a different ideology, and the United States hasn't had that before".
She added that this would be "the first time that we will have a great power competitor that is not Caucasian". The war with Japan is forgotten.
But the big point is her framing of this as a civilizational and racial war and so as an insoluble conflict. This cannot be accidental. She is also still in her job. Others present the conflict as one over ideology and power.
Those emphasising the former point to President Xi Jinping's Marxist rhetoric and the reinforced role of the Communist party . Those emphasising the latter point to China's rising economic might. Both perspectives suggest perpetual conflict.
This is the most important geopolitical development of our era. Not least, it will increasingly force everybody else to take sides or fight hard for neutrality. But it is not only important. It is dangerous. It risks turning a manageable, albeit vexed, relationship into all-embracing conflict, for no good reason. China's ideology is not a threat to liberal democracy in the way the Soviet Union's was. Rightwing demagogues are far more dangerous.
An effort to halt China's economic and technological rise is almost certain to fail. Worse, it will foment deep hostility in the Chinese people. In the long run, the demands of an increasingly prosperous and well-educated people for control over their lives might still win out. But that is far less likely if China's natural rise is threatened.
Moreover, the rise of China is not an important cause of western malaise. That reflects far more the indifference and incompetence of domestic elites. What is seen as theft of intellectual property reflects, in large part, the inevitable attempt of a rising economy to master the technologies of the day. Above all, an attempt to preserve the domination of 4 per cent of humanity over the rest is illegitimate.
This certainly does not mean accepting everything China does or says. On the contrary, the best way for the west to deal with China is to insist on the abiding values of freedom, democracy, rules-based multilateralism and global co-operation. These ideas made many around the globe supporters of the US in the past.
They still captivate many Chinese people today. It is quite possible to uphold these ideas, indeed insist upon them far more strongly, while co-operating with a rising China where that is essential, as over protecting the natural environment, commerce and peace.
A blend of competition with co-operation is the right way forward. Such an approach to managing China's rise must include co-operating closely with like-minded allies and treating China with respect.
The tragedy in what is now happening is that the administration is simultaneously launching a conflict between the two powers, attacking its allies and destroying the institutions of the postwar US-led order.
Today's attack on China is the wrong war, fought in the wrong way, on the wrong terrain. Alas, this is where we now are.
Jun 09, 2019 | www.moonofalabama.org
vk , Jun 9, 2019 4:04:26 PM | 27Two important posts from Michael Roberts' Facebook.
About the USA:The end of the American dream (if it ever existed)..
In America and also much of Europe, the current post-war baby boomer generation will be the first that cannot expect their children to get higher living standards than them. The percentage of 30-year olds earning more than their parents is at its lowest level ever recorded.
Inequality of income is at its highest in 100 years, when you compare the share of the top 1% to the bottom 90%.
The economic mobility rate in the US is now one of the worst in the developed world. In the US, people in the bottom income quartile have a 40% chance of having a father in the bottom quartile (in the father's prime earning years) and people in the top quartile have only about an 8% chance of having a father in the bottom quartile, suggesting half of the average probability of moving up and one of the worst probabilities of all the countries analyzed.
About Japan and Germany:Two key G7 economies continue to show a significant slowdown in economic growth.
German industrial production plunged 1.9 percent from a month earlier in April 2019, much worse than market expectations of a 0.4 percent fall and after a 0.5 percent gain in the previous month.
That was the biggest drop in output since August 2015, amid falls in the production of capital goods (-3.3 percent), intermediate goods (-2.1 percent), energy (-1.1 percent) and consumer goods (-0.8 percent). Year-on-year, industrial production dropped 1.8 percent in April, following a 0.9 percent fall in March. Manufacturing output dropped 3.4% over the year. Both exports and imports fell.
The German Bundesbank cut its GDP growth forecast for this year to just 0.6%, down from 1.6% at the beginning of 2019.
Japanese wages fell for the fourth consecutive month and overall household spending slowed sharply. Unemployment, currently at record lows, is set to rise.
Jan 13, 2019 | www.nytimes.com
Meredith New York Jan. 6Darsan54 Grand Rapids, MI Jan. 5
NYT David Leonhardt "When the Rich Said No To Getting Richer". Quite a contrast. "A half-century ago, a top automobile executive named George Romney -- yes, Mitt's father -- turned down several big annual bonuses. He told his company's board he believed that no executive should make more than $225,000 a year (which translates into almost $2 million today).
He worried that "the temptations of success" could distract people from more important matters. This belief seems to have stemmed from both Romney's Mormon faith and a culture of financial restraint that was once commonplace in this country. Romney didn't try to make every dollar he could, or anywhere close to it. The same was true among many of his corporate peers. In the early 1960s, the typical chief executive at a large U.S. company made only 20 times as much as the average worker, rather than the current 271-to-1 ratio. Today, some C.E.O.s make $2 million in a single month. The old culture of restraint had multiple causes. One was the tax code. When Romney was saying no to bonuses, the top marginal tax rate was 91%." That was under GOP Eisenhower. And jobs here, unions strong, state college tuition tax subsidized-- the middle/working class had upward mobility and faith in the future. Now, per the international GINI Index of middle class security and upward economic mobility, the USA ranks behind many other capitalist democracies. What would George Romney say about Trump as president?Len Charlap Princeton, NJ Jan. 5
@Tom: Could it be possible too many loopholes and deductions are written into the system to make it effective? We have been defunding the IRS and building a tax system that favors creative returns for decades. Maybe it's time to go in another direction.Penningtonia princeton Jan. 5
@Ron Cohen "The salary of the chief executive of a large corporation is not a market award for achievement. It is frequently in the nature of a warm personal gesture by the individual to himself." John Kenneth GalbraithBrinton Los Angeles Jan. 5
@WPLMMT; You mistunderstand. The 70% applies only to income OVER the threshold. So theoretically, the first 50 thousand (above the standard deduction) could be taxed at ,say 10%, the next 50K at 20%, from 100K - 500K at 30%, from 500k to a million at 50%. So the takehome from a million would be 715K, enough for anyone to live on. The exact details don't matter. It is the idea that only income above a very high number would be taxed at the marginal rate.Andrew NY Jan. 6
If the goal is to raise revenue by taxing high earners at a higher rate, it seems to me that a good place to begin would be to raise the effective tax rate on the rich to around 40% by eliminating the 50% discount on capital gains, and the depreciation allowances for real estate investments.fatrexhadswag DC Jan. 6
Income tax rate increases at high income levels would help but they miss the point. The real wealth in this country is from those who own assets, not those who draw a paycheck. The real deal would be to raise taxes on passive income and estate taxes on an ever increasing scale where, say, anything over $1m in annual passive income and $50m in estate value is taxed at 50% or higher. America is the land of opportunity; if those of us lucky enough to make it just leave it all to our heirs, they will have little incentive to work and add value to their own lives as well as to society. Plus the velocity of capital that would occur from heirs being forced to sell companies, real estate and other assets to pay estate taxes will place those assets in the hands of those best able to maximize their value going forward. Paul and AOC, I hope you are reading this and plugging it into your thinking.Jeffrey Bank Baltimore Maryland Jan. 6
I only wish the democrats would try to educate what the marginal tax means when they discuss policy in the public sphere. The media is going to go nuts with this 70% rate without taking the time to explain that it's only an additional bracket at the tippy top of the scale. This proposal wouldn't affect 99% of the country.LM Jersey Jan. 6
Every day I see and hear more about this young woman, I am more impressed. Disclaimer: I am a 68 year old white guy (Jew). She is smart, articulate, talks truth to power, and is also very hot! A tough combination to beat.Her Twitter comebacks against old Republican men are witty and hilarious, and hit home. I say AOC has a great future. She will learn the political ropes quickly. In ten years, stand by to stand by.Thomas K. Ray Marquette, Michigan Jan. 6
A high percentage of wealthy people inherited their money. There are many examples of highly successful men who marry beautiful, but not necessarily intelligent women. Their children's IQs are somewhere in between their parents IQ numbers. The end result is greed-driven wealth management and less than honorable decisions, including buying politicians. Narcissism runs rampant among this group with POTUS and some of his children as a prime example. Thomas Jefferson strongly felt that large inheritances should be heavily taxed to prevent the harmful activities of the very rich from destroying our democracy. He was right.Earl Philadelphia Jan. 7
We all benefit from living in this great nation of opportunity. Once you make more than 100K per month you should pay 70% tax. It is OFFENSIVE that our great nation does not provide free education through college, provide health insurance (especially, since there are people making millions ripping off the medical system), provide free daycare, housing and food for those who need support. TAX INCOME OVER 1 million....if this is a disinsentive then there is something seriously wrong with you.GG New Windsor Jan. 7
The U.S. has had a long history of a graduated income tax. In the Reagan era, the tax rate was at 50 percent having come down from 70 percent. We are not funding government spending, and are instead running up substantial deficits. Moreover, as the baby-boom population retires, social security and medicare will become unsustainable. While we can certainly reduce government spending significantly (especially the sacred cow of military spending), we will need to increase tax revenues. Tax increases are inevitable, and the most fair way to distribute the burden of increased taxes is through a graduated income tax. Those with the ability to pay, should pay more. After all, they are certainly enjoying the benefits of a free and stable country more than those at the other end of the income spectrum. While we can argue what the top marginal rate should be, it certainly should be 50 percent or greater. We should also eliminate the special tax preference given to dividends and capital gains, which mainly inure to the wealthy. To those whom much is given, much is expected.hammond San Francisco Jan. 5
@Jason First, no one is talking about taxing businesses at 73%, only individuals who are at extreme high levels of income. Second, why do the rich always seem to think that the "unwashed masses" owe them something? Go to Canada where in addition to a higher tax rate on your business you will also be paying for single payer health care for employees and subject to common sense regulations that businesses here are no subject to. The grass is always greener.Andy House The Sane White North Jan. 6
@NR Agreed and same here with our money. How much does anyone really need, beyond a certain point? Wherever that point is, I passed it decades ago. It's so disheartening to see how many people, often quite poor people, fully believe the mantra that taking money from rich people will reduce jobs and growth. Very little of my wealth goes towards growth. It's in index funds and T-bills and other instruments that mostly hold it until it's traded to some other wealthy person, hopefully at a profit to me. About the only way my money leads to growth is through the start-ups I have self-funded over the years. And even these were sold to large corporations (or they failed) by the time they had a few hundred employees. Most exits occurred with just a dozen or so employees. Mostly the wealthy barter and trade pieces of their portfolios with one another. It's just a game.Thomas Zaslavsky Binghamton, N.Y. Jan. 5
The most obvious thought to share here is about the laughable efforts of people who don't know economics from shoe boxes to try and sound more knowledgeable than a Nobel prize winning economist quoting... Nobel prize winning economists. The second most obvious thought is that the threat/boogie man of all the "rich people" leaving the US for "greener pastures" is both ludicrous and historically refuted. They simply DID NOT LEAVE in the 20th century, despite the economy becoming more mixed. They DID NOT LEAVE when the top MARGINAL tax rates were above 75%. And they did not leave when their research (you know, there actually is a fairly high correlation between affuence and intelligence...) revealed the FACT that the best places in the world to live are almost universally even more "mixed" than the US, are almost universally further left than what passes for a "left" in the US, and almost universally have significantly higher taxes. Folks, they just aren't going to bag up their bucks and blow town.The Observer Pennsylvania Jan. 5
@hm1342 It goes for politicians, some of whom are notably stupid, but not economists, who tend to be quite smart, if not necessarily correct.Paul Phoenix, AZ Jan. 6
Before Ronald Reagan, the top marginal tax rate was 70%. The country was doing fine and the rich were doing well also. Reagan reduced it to 50% and the rate was further reduced in subsequent administrations. For the last 40 years, there has been a massive transfer of wealth from the middle and the bottom earners to the very top. A main reason for the income inequality that we see in the country today. The top marginal rate should be raised above 70%. Money made by labor and money made by money (investment) should be taxed at the same rate if we want to narrow the income inequality in the country and also find the money for investments in infrastructure etc. What AOC is saying is nothing radical but common sense.B NYC Jan. 5
"You see, the mere thought of having a young, articulate, telegenic nonwhite woman serve is driving many on the right mad -- and in their madness they're inadvertently revealing their true selves." Actually, professor, the mere thought of having a young, articulate, telegenic nonwhite man as president for 8 years DROVE many on the right mad- and in their madness they're inadvertently revealing their true selves.sjs Bridgeport, CT Jan. 5
But rich people also benefit from raising their taxes in that the society as a whole takes a huge leap forward. Investment in our society leads to lower crime rates and less incarceration lead to a bigger tax base. Improvements to infrastructure and health care reduce enormous drains on the economy. Investment in education increase the value of labor, and most of all eliminating the deficit makes us strong at home and abroad. Everyone wins.Pam Skan Jan. 7
@Red Sox, '04, '07, '13, '18, It is worth remembering just how much the companies of the mega-rich depend on tax paid for services and infrastructure. Where would Amazon be with out the road and US postal service?Blunt NY Jan. 5
@Billy Walker At less than $100k/year in income, you needn't worry. In income tax terminology, the term "marginal" means a rate that's applied only to income above a high threshold affecting the top percentile of earners. In your IRS Form 1040, you'll note that you are taxed at a certain percentage based on your adjusted gross income (AGI). Your AGI places you in a tax bracket, or income range. A marginal rate of 70% would apply to the highest tax bracket, because it would affect only those dollars that exceed a certain threshold (such as the $10 million mentioned by Ocasio-Cortez) - a threshold most of us will never even imagine earning, much less topping. Don't let the number scare you, Billy Walker - unless you hit the Powerball.Trippe Vancouver BC Jan. 5
Professor Krugman, I am delighted that you are back to writing what you know best and help the nation understand what is behind the noisy rhetoric. Ocasio-Cortez is an impressive politician. By getting good advice from experts, whether it is economists, sociologist, climate scientists and political philosophers, she will deliver to the congress a much needed intelligent and sunny feedback to propose and implement good policy. Please seek her out and offer her your advice. People like Saez, Piketty, Reich, Stiglitz and yourself are treasures (except for the second and perhaps the first national treasures) politicians should tap into. We need the GOP out of our lives. Rational taxation policy is one of the key elements of a successful Democratic government. It will help pay for all the good ideas: universal healthcare (you are lagging behind there), free public education from Kindergarten through College, environmental sanity. Regulation of Big Pharma, Wall Street (tax algorithmic trading for one, bring back G-S for another), Big Tech and of course Big Healthcare will all help getting back our country to sound governance of the FDR era, tax policies included. Thank you in advance.Bruce Shigeura Berkeley, CA Jan. 6
@Charlie in NY I do get tired of this type of comment, 'outsourced their military defence to the US'. The cold reality is that US administrations have very much wanted to have the largest military and a stunning number of military bases around the world. Your governments have embraced the role of world's police force including covertly (and openly) pursuing regime change in many jurisdictions. Over the decades your country has very much wanted this role, at the expense of other important priorities and needs in your country. Don't blame the rest of us for wanting a more balanced approach to military and other spending. Your wars in the Middle East, which have nothing to do with Europe, have cost you tremendously.Rob NYC Jan. 5
AOC is a ground-breaker on taxing the rich. I hope she takes on raising the corporate tax, which Bernie has hinted at. Chris Rock once explained, "Shaq is rich, but the white man who signs his check is wealthy." Raise Bezos' income and capital gains taxes, sure, but go for the big money -- tax Amazon's profits, assets, stock trading, acquisitions, and end all tax break/corporate welfare. Apple spent its Trump tax break buying back stock to enrich stockholders and executives; Sheldon Adelson put his on Republicans in the '18 election. Hedge funds bought, dismembered and stripped, then bankrupted Toys R Us and Sears, and another is ripping off Puerto Rico.
Neoliberal capitalism has gutted the American middle and working classes, leaving only gig economy jobs, like Saturn eating his children. Tax 'em and put their money to use on health care, education, the Green New Deal and job creation, affordable daycare, and rebuilding communities.Carole East Chatham, NY Jan. 5
@Michael Evans-Layng, PhD Yes, I agree with this comment. It's not even possible to conclude that there is a correlation here; my guess is that a correlation would not hold up to statistical analysis. However, it is certainly clear that, "high taxes on the wealthy and solid economic performance can coexist just fine". And that's all one needs to know, as a higher marginal rate will bring many benefits without having to hold the burden of being a single-variable driver of growth.Grove California Jan. 6
If 20% of this country understands what marginal rates are, then I'd be surprised. I have been a financial professional for 30+ years, and I rarely have a client - no matter how sophisticated - that understands it. And somehow I wonder how much of Congress understands it. Our country experienced strong growth and a healthy economy when marginal rates were high. And the concentration of wealth did not exist back then. We are just rationalizing a greed is good mentality by using terms like 70% tax rate - to scare people - instead of just saying raise taxes on the top 5%.SC Boston Jan. 5
The Republicans are looting the country with no one stopping them. The rich control all three branches of our government, which explains our current fiscal policy. The rich obviously don't want to be part of America other than to own it.William NY Jan. 7
@MV This reminds me of when, I believe it was towards the end of the last recession, I accidentally found myself on a Republican phone list. I got a call during which they were pitching tax breaks for the wealthy saying how it would create jobs. My response was to say that they wouldn't add jobs, just spend it on more Hermes scarves. (They go from several hundred to a couple thousand dollars.) I thought I was wise-cracking but sure enough I saw in the news a day or two later that Hermes stock was doing remarkably well.Concernicus Hopeless, America Jan. 6
@Jason, the rationale here is that society is better served with more equitable wealth distribution, as seen in Scandinavian countries, rather then the obscene wealth disparities seen here in the U.S. Your answer to this is, if you try and raise my taxes in order to benefit society as a whole, rather then just me I will run to anywhere that has the lowest tax rate. Well this is the mantra of every wealthy individual and business globally and as a result we have a tax base comprised of higher rates for middle income Americans who are squeezed financially in every direction and actually need the money, who carry the financial burden, while the wealthy use their money to buy political influence and over time further lower their tax rate for themselves and the business's they own, thus skirting their financial responsiblity to society which they benefit from. The rich have done plenty wrong, that is the point. We would not be in the horrible situation we are in now as a country without the sociopathic levels of greed seen in the upper echelons of wealth. Its time to take back the country from people like yourself who would rather run and preserve or hide their wealth then be willing to pay their fair share of taxes.79 RecommendJimB NY Jan. 5
@Allan Reagan I doubt very seriously that you or just about anyone else regularly works 75 hours a week. That would very roughly translate into just under 11 hours a day seven days a week. Meaning you are at the office by 8:00 AM and leave around 8:00 PM seven days a week. I am being very conservative in allocating only one hour for eating, bathroom breaks, personal phone calls, etc... Your wealth would likely mean a mansion in the suburbs. Figure a minimum of 45 minutes each way drive time. Total round trip an hour and a half. An hour to shower, shave, have coffee and quickly check the daily newspaper. I have allocated zero time for dinner time, shopping for clothes or food, etc... Zero family time. The math just does not add up. If by some freak of nature you really do work 75 hours a week then you are an all-time terrible husband and/or father. No matter how big your bank account is or how many houses you own. Ask your family....would they rather have less things and you only working 45-50 hours a week or more things. If they even care anymore. Promoting absentee husbands and fathers is certainly not the way to craft a truly civil society.79 RecommendKeith Dow Folsom Jan. 6
Zillionaires work harder by investing smarter. Investing smarter often means certainty in return on that investment. How better to insure that certainty than to invest in a "low tax" congressperson? Much easier and better expected return than say R&D or infrastructure.79 RecommendPdxtran Minneapolis Jan. 5
@Barking Doggerel Intel is a prime example. The first Intel CEO who was a Republican, was a Bush supporter named Paul Otellini. He famously told Steve Jobs that Intel did not want to make the microprocessor for the iPhone. Intel then went from being the number one maker of microprocessors to being the number two. The second Intel CEO who was a Republican, was a Trump supporter named Brian Krzanich. He was an "expert" at manufacturing. Under his leadership Intel went for being the number one semiconductor company to being the number two. Apparently Republicans have a penchant for turning everything into number two.78 RecommendWalter Toronto Jan. 6
@vulcanalex: As a frequent commenter here, you SHOULD know about marginal tax rates, namely, that even with a top tax rate of 90%, nobody would pay that on their entire income. In the days when that rate was in force, it kicked in at an income level that would be equal to about $4 million per year. In order to avoid that, rich people upped their charitable contributions and did other things that might benefit society. Best of all, none of them starved.77 RecommendTessa NYC Jan. 7
@Andrew You are right - Warren Buffett stated that he pays less income tax than his secretary as his income derives from capital gains and dividends, and hers from employment.75 RecommendJohn C MA Jan. 6
His article was about personal income tax, not business tax. Unless you relinquish your US citizenship, you will have to pay income tax regardless of where your business is located. The point of discussing an increase in income tax on the ultra rich is to be able to fund social security, Medicare and Medicaid, and the other federal programs and agencies. Why is this relevant? Because Republicans routinely cut taxes for the wealthy and then say they need to cut funding for all these programs to balance the federal budget. If we can generate sufficient revenue for the federal government then we don't need to cut funding for all these federal programs.71 RecommendVesuviano Altadena, California Jan. 5
The Trump tax cut has added $2trillion to the national debt -- -an increase of 10%. The tax cut was supposed to pay for itself, because the increase in wages and profits would provide enough in tax revenue ( even at the lower tax rate). The deficits would shrink and eventually go away. None of these fantasies have ever been realized. Not under Reagan, W, or Trump. Its time to Ms. Cortez-Ocasio's "insane" ideas -- a 90% tax on income over $10 million per year is no crazier than these Republican tax schemes and the "suffering" only affects a tiny nunber of citizens. A return to Eisenhower-era tax rates hardly constitutes Bolshevism.Reply 71 RecommendKen L Atlanta Jan. 5
There are a lot of comments here criticizing AOC and Professor Krugman over the idea of such a high tax on the mega-wealthy. To them I simply say this: You can't get away from our country's history. We were collectively at our most prosperous as a nation for the twenty-five years after the Second World War, during which time our middle class was the envy of the world. During that time, taxes on the very rich were in line with what AOC is proposing. Corporate taxes were also high. Union membership was also high. Our country was much better off for all of those things. I'm already a fan of AOC. She's going to make a lot of right-wing heads explode.Reply 70 RecommendTMSquared Santa Rosa CA Jan. 5
I'd be interested in knowing to what extent much higher tax rates on the wealthy drive severe tax avoidance behavior, like parking money overseas. Clearly higher rates would have to be accompanied by stricter enforcement and tighter rules to avoid losing the expected revenue windfall.69 Recommendazlib AZ Jan. 5
@hammond Good point about the postwar conditions that went along with high marginal rates. But even if we avoid the mistake of concluding that high rates caused growth, there is still no reason to conclude that high rates impede growth.68 Recommendhm1342 NC Jan. 5
Maybe a higher marginal tax rate with stricter enforcement woudl have driven Trump out of the country and saved us the horror of the last two years. :-)Reply 67 RecommendSteve Berkeley CA Jan. 6
@Barking Doggerel: "And the very wealthy I've known are not smarter, more creative or virtuous than the folks who work for them or for other wealthy executives." That goes for politicians and economists, too.66 RecommendDan Kravitz Harpswell, ME Jan. 6
What is stupendous wealth good for? The marginal utility of wealth is quickly decreasing for ordinary survival goods like food and tents. But very expensive goods can only be had by the most wealthy. To get the most expensive and desirable things you must outbid other wealthy people. If you want to influence a key senator, for instance, you're going to have to come up with more than the opposition. If you want an original Van Gogh to impress others, you're going to have to outbid everybody else. If you need a kidney transplant quickly it won't be cheap. Wealth buys power. A mere millionaire nowadays only has leverage against common folk but is seen as a whiff by any billionaire. Power is roughly proportional to wealth, it's a relative thing. Those more wealthy can always kick sand in your face and that's still aggravating despite that you can kick sand in the faces of the myriads of the poor. The wealthy believe in the legitimacy of wealth and strive to purify this. There are always illegitimate jerks trying to beat the system, trying to circumvent the power of wealth. Jerks yammer about things like truth, science and justice. What they're really trying to do is get power without properly paying for it. It's necessary to put down those upstarts who whine about such things. This is another thing wealth is good for and another reason why you can never have enough.Reply 66 RecommendFourteen Boston Jan. 5
You quote economists in defense of your argument, or as the Republicans would say 'pointy-headed intellectuals'. But if Ocasio-Cortez is crazy, what would the Republicans call Dwight David Eisenhower? He thought a marginal tax rate of 91% was just right. So he's obviously far crazier than Ocasio-Cortez. Dan KravitzReply 65 RecommendLennerd Seattle Jan. 6
@Rima Regas The Rich really do believe they're entitled to rob the poor, and they've created various laws that make it easy and legal, which further entitles them, or so they believe. It's all part of the Rich-person alt-reality - a perk of being rich.65 RecommendHoward Stambor Seattle, WA Jan. 5
On the other hand, "...having a young, articulate, telegenic nonwhite woman serve . . . " in Congress is just exactly the ticket!62 Recommendr a Toronto Jan. 6
Just a reminder – and of course this is obvious to most readers – but neither the article nor many of the comments make it clear that the 73% or 80% is the last step of a progressive scale. Krugman and AOC are not proposing that ALL income be taxed at that rate. The maximum rate would apply only to that portion of a taxpayer's income above a certain dollar amount. The 73% or 80% rate could actually be set at a very high level of income, say $1 million or more. The benefits to all would be enormous. The detriment to high earners would be small.61 RecommendPenningtonia princeton Jan. 6
How about fixing the tax code - created by and for racketeers.Reply 61 RecommendSuzanne O'Neill Colorado Jan. 5
@Barking Doggerel; You neglected to mention golf, which was a major factor in getting promoted at the large corporation I worked at.60 RecommendPeter Ottawa, Ontario, Canada Jan. 6
@vulcanalex And what is good for the country and your fellow citizens? I would hope that it is not all about you. If one's goal is to have a vibrant economy, good infrastructure and education are needed. I have two suggestions as to where to look for the needed funds: corporations (especially those paying employees less than a living wage and depending on taxpayers to provide food stamps and subsidize health care) and the very high income individuals. You may not be in the latter class. I believe a fact-based national conversation about tax rates (individual and corporate, earned and unearned income and capital gains) would benefit the nation. I am not optimistic this could occur without significant leadership.59 RecommendR. Law Texas Jan. 5
Paul, I must plainly admit, not too often do a shed a tear when reading, your article today was such a moment. It was on a sidewalk in Paris or New York to celebrate my daughters birthday, that surfaced as I read on. Pretty sure it was Paris, as we walked along, I noticed a family. I looked only at the father - sitting on some cardboard, his two children and his wife beside him - I gave what i could and his eyes spoke thanks and my eyes spoke hope for his obviously wonderful family(and himself as well). Paul, as the good man said "the times they are a changin" and I believe with all my heart that Equality really needs to be spoken of at many dinner tables. Sincerely, PeterReply 59 RecommendPhillip Wynn Beer Sheva, Israel Jan. 6
Very interesting how AOC understands economics in this country, and how many GOP'er bugaboos are about to get skewered :) Why, we might even find ourselves in a public discussion of democracy and unrestrained capitalism being polar opposites, with GOP'ers having to admit there was democracy in this country - which heavily restrained capitalism - long before the vaunted animal spirits of free marketeer piracy descended upon us. As in, democracy provided the environment for capitalism to succeed, not the other way 'round, and that democracy should take precedence over free marketeering piracy. After all, the original settlers and colonists only allowed corporations to exist with charters which had automatic expiration dates, corpoorations were only allowed to exist for the purpose of some public works project, and a corporation's charter was immediately revoked if it was found to be trying to influence a political campaign; in no sense of the word were corporations people, too, my friend (quoting a famous American). My, my, my, what an interesting history discussion is about to occur - could Elizabeth Warren please be the Professor, Professor Professeur K. ?59 RecommendRichie by New Jersey Jan. 5
Hate to disagree, but there's clear evidence AOC doesn't understand economics. For instance, she has argued it's impossible for her to find affordable housing in Washington DC. Whereas it's become plain that she is living rent-free in the heads of many Republicans.Reply 59 RecommendMatthew Carnicelli Brooklyn, NY Jan. 5
@Red Sox, '04, '07, '13, '18, The rich that benefit from profits of large companies, like Walmart for example, do not do the actual work themselves. Instead they rely on the working poor to create their profits and then they hoard it all, while the rest of us provide money for food stamps etc.59 RecommendCitizenTM NYC Jan. 6
@Kenneth Johnson The 73% rate would only be on income above a stipulated amount, say $10,000,000 a year. Are your yearly earnings above $10.000.000 a year? The problem with unregulated capitalism is that it leads to people eventually wanting to impose an unrealistic form of socialism. Experience strongly suggests that a mixed capitalist-socialist economy is as good as it gets.58 RecommendEllen San Diego Jan. 5
'... privilege combined with aggression ...' THANK YOU.58 RecommendTMSquared Santa Rosa CA Jan. 5
@MV "Those who get that little extra $1,000 will easily spend it on a necessity, like an appliance". Exactly. And, given the tax giveaway the Republicans gave to corporations and the 1% last year, there probably won't be that little extra $1,000 for the appliance buyers this year. They'll probably owe.57 RecommendGator USA Jan. 7
@SandraH. Exactly. Impose high marginal rates on capital gains at the same time. We could make them a bit lower than income tax rates to incentivize capital investment. But now, even with low income tax rates, the difference between capital gains and income tax rates is a scandal--basically a fat loophole for rich capitalists.57 RecommendChris philadelphia Jan. 6
@Billy Walker How much of Jeff Bezo's (for example, nothing against him specifically) billions in annual income would have been possible without the existence of the interstate highway system? How about without the existence of the US postal service? How about without the internet (it wouldn't exist without DARPA's pioneering research)? Seems to me the government and US taxpayers were equal partners (or greater) in his earnings.57 RecommendAWG nyc Jan. 5
I would be more inclined to not laugh at Ms. Ocasio-Cortez if she had articulate and well reasoned thoughts. Instead she spouts leftist talking points and when asked for detail or context she almost always struggle to provide it. But because leftists like what she is saying they give her credibility just like Mr. Krugman.55 RecommendJohnson Smith TN Jan. 6
My father was a CPA during the years from 1947 to 1983. We had this discussion about tax rates early on when the highest rate (during the Eisenhower administration) was 90%. When I asked him about it as a child, he said simply that no one paid 90% of their income to the government. First of all the tax code had many more loopholes than later on, and secondly, he taught me the idea of a "graduated tax", which we still have on the books. All of us pay 10% on the first 15,000 or so that we earn, then 12% on the next 10,000 or so, then 15% on the next, and so to the top rate of 36%. The problem, as AOC and Prof. Krugman point out is that those at the very top of the income scale pay practically nothing compared to those below. The same is true when speaking about the Social Security tax (FICA) which is something like 6% of you pretax income and is capped, at I believe, around 128,000. Which simply means that if you make 100,000 a year your paying 6000 into the system, if you make 10 million, your still paying only around 6000 into the system (or about 0.0006%).55 RecommendArturo Belano Austin Jan. 6
So much greed by these socialists. No, you do not have a right to someone else's properties simply because they have more than you do. The rich already pays an oversized amount of taxes, while the bottom 50% pay zero in federal taxes. That does not sound fair. In America, everyone is free to start a business and make money, and most billionaires in this country are self made. They worked harder than anyone else. Bill Gates, for instance, started Microsoft at age 18, when most other guys his age were wasting their time at meaningless night clubs. He worked hard and long, and for ten years, did not take a single day off from work. Eventually, it began to pay off. The the greedy socialists came out of the woodwork, demanding to "tax the rich" to pay their "fair" share. Well, the rich already pay more than their fair share.54 RecommendRick Garber Minneapolis Jan. 5
Paul Krugman clearly hit a nerve. The dubious right is out in force here in the comments section to defend the rights of the beleaguered rich.Reply 54 Recommendcjl miami Jan. 5
The comments to this piece have reinforced my belief that a sizable portion of American taxpayers do not have a clue as to how the calculation of their federal tax bill is actually structured. At the very least, the term "marginal tax rate" is synonymous with "total tax rate" for most. To those who are trying to effect a sane change to our country's taxation policies, I say you need a structured PR campaign to raise awareness of just what the heck "marginal tax rate" actually means. You could start by showing how, even under current rates, it's possible for someone making an average income (Warren Buffett's secretary?) to pay a higher effective/total tax rate than someone (Warren Buffett?) whose income puts them in the top 0.1%. If you don't believe me, next time you're discussing taxes with friends, ask them the following math problem: John's adjusted gross income is $1M; The top marginal rate on that income is 37%; How much tax does John pay? If the answer you get is, $370k, well, that's my point. Most people won't say that there's too little information given to solve the problem. (This is, the current top rate on that income, by the way.) Once a sizable majority of Americans actually understand this, getting the support to enact a top MARGINAL rate of 70% shouldn't be too hard of a sell.53 RecommendDaniel USA Jan. 7
@Charlie in NY The Scandinavian countries are facing a whole lot less difficulties than the US. The military spending argument is a red herring. The US deal with NATO is/was that the Europeans would provide the cannon fodder for WW3, while the US would provide the nukes and high tech systems. This allowed the US to funnel money into the defense industry, while not maintaining as large an army as would otherwise be required. Back out of NATO, and all those European countries will "go nuclear" as fast as they can buy the technology from Israel. Is this in the US's best interests? We didn't think so after WW2. The saying was: NATO was designed to Keep the US in, the Russians out, and the Germans down.53 Recommendrj1776 Seatte Jan. 5
@Freda Pine the top rate 70% would not apply to you and if it did, the author of this opinion piece and most of its supporters would likely agree that you should not pay anywhere near 70% if you are making 300,000$52 RecommendGT NYC Jan. 6
"We can have democracy in this country or we can have great wealth concentrated in the hands of a few, but we can`t have both." --Supreme Court Justice Louis D. Brandeis A fundamental reason for higher tax rates on the rich.Reply 52 RecommendJD Smith Pittsburgh Jan. 5
We tried this ... it was called the 70's. Did not end well .....Reply 52 RecommendPeter G Brabeck Carmel CA Jan. 5
I think it would serve progressives well to clarify their rhetoric and policy proposals and speak about raising taxes on the ULTRA RICH? I think there are many people who might be considered "rich", who already pay quite a bit in taxes, but aren't earning enough to engage in the complicated tax-dodging schemes that the ultra rich use. They bear the brunt of a tax code that allows ultra rich earners off the hook while they pay a lot in relation to their earnings. I know many upper-middle class people who might otherwise agree with Democratic policies, but when they hear "tax the rich" they vote Republican because they can't imagine paying more in taxes. It's the Jared Kushners of the world who should pay more, not the small business owner with a few million in a retirement portfolio.52 RecommendLisa Cabbage Portland, OR Jan. 5
A more pedestrian way to view Prof. Krugman's argument is to compare social unease and income/wealth distribution during what many, including conservatives, regard as the nostalgic fifties (fifty years ago, they commonly were labeled the fabulous fifties) with those of today. The 1950s, while it certainly had its problems and the civil rights movement still was in its nascency of emerging from 150 years of overwhelming oppression, nevertheless marked a decade of arguably America's most prosperous period when the prosperity metric is distributed proportionately across all socio-economic classes. The wealthiest lived very well indeed. Private railroad cars still adorned rail lines before the advent of private jets. While extreme poverty existed, especially among urban blacks and other minorities, and some rural communities, for the most part, the vast middle class was progressing and living comfortably. Top-tier marginal tax rates for large corporations and the wealthiest hovered close to AOC's proffered 80%. Most importantly, large corporations still operated on the principle that they were accountable to their stakeholders, i.e., investors, employees, customers, suppliers and communities, not solely to shareholders. Companies offered retirement pension plans rather than 401ks and they honored them. Management was compensated reasonably for their services, not with get-ultra-rich schemes that were backed by ludicrous fail-safe parachutes for malperformance. AOC is right.Reply 51 RecommendJason Dallas Jan. 7
@hammond Look at the dates on the graph, the high growth came AFTER 1960. Which war are you thinking "supercharged" the manufacturing sector? As far as causality and causation, gee wiz, this is a newspaper, not an academic journal, the man can only give so much evidence without losing readers. For a more complete presentation, read Jacob Hacker, "American Amnesia: How the War on Government Made Led Us to Forget What Made America Prosper." Government investment is critical for high growth rates, and the wealthy need to pay taxes for that to happen.51 RecommendWhite Buffalo SE PA Jan. 5
@Jason The rich do something wrong every day. From the perspective of someone concerned with labor rights, which perhaps you aren't, they receive compensation vastly disproportional to the amount of labor they expend, and outrageously disproportional to the amount of labor expended by people who aren't rich who work equally long hours and make similar sacrifices. That is what is wrong with the notion of a free market. It is immoral and unethical, and you have to put an academic faith in the superiority of the free market system above your concern for what's right in order to participate in a system like that, and most of us either do or simply don't have any choice in the matter. Not everyone cares about that. From the perspective of someone who is just concerned with incentives and outputs, who has bought into the notion of a free market system, what is wrong is that, as Krugman points out, we don't operate within perfectly competitive markets, not even close. From that perspective, the rich profit from a system that naturally favors them completely independent of variables like labor, risk, demand, etc. I don't guess you have to go to confession for having done something wrong, but a little humility and perspective never hurt.51 RecommendT Ontario, Canada Jan. 5
@Bruce Rozenblit " To top off the entire royalty thing, much of their wealth was most likely generated from tax breaks, tax giveaways, tax shelters and the like. Odds are that a substantial portion of their wealth was never taxed to begin with and with the loss of the estate tax, they get to will it to their heirs tax free." Example #1. Trump and his family. Example #2 Mitt Romney, whose Bain Capital wealth derived from tax breaks earned by bankrupting once solid corporations and raiding their pension funds, etc, then delivering the bill to the tax payers to pay through the Federal Pension Insurance agency and other tax payer funded sources like welfare, Medicaid and unemployment insurance for those who lost their jobs and benefits.51 RecommendAppu Nair California Jan. 6
Bravo, AOC. Hopefully this will mean growth in the middle class. Many of the very wealthy don't like to admit that their wealth was largely contingent upon economic and tax policies that drove many from the middle class down to have-not status. Hopefully this kind of policy will right that wrong.51 RecommendJim Davis California Jan. 6
Squeezing the top 5% will not be enough to fill the Federal coffers. The super rich have superbly qualified accountants. In our borderless economy, tax havens and loopholes galore to attract and retain rich folks from all over the world. They exist right now but the incentives to hide from Uncle Sam are far less than the overtaxed, nanny states of Europe. Cortex the conquistador needs to earn money on her own by working first, pay taxes, meet payroll or know people who are not on the doll in order to understand taxes make the wealthy flee. And, investment will sink. Talks like this has already made her the East Coast counterpart of the elder stateswomen of stupidity, Rep. Maxine Waters. It is hard to recover from absurd public pronouncements that are etched in hard disks forever.Reply 51 RecommendBrendon Carr Seoul, Korea Jan. 6
A 90% tax rate on anybody doesn't seem to be a fair number. Nor 80% or 70%. Sorry but how about institute a luxury tax penalty on corporations who give out huge CEO payouts. Works for the NBAReply 50 RecommendMark Thomason Clawson, MI Jan. 5
The unstated but glaringly obvious assumption in Paul Krugman's and Sandy Ocasio's worldview is that "The Rich" are not citizens and human individuals with their own rights and interests, and families for which to care, but rather livestock to be farmed, milked, and slaughtered for the sustenance of everyone else -- under the wise instruction of Paul Krugman and Sandy Ocasio, of course, who as the will not be required to make the same sacrifices they demand of their fellows amongst The Rich. It's appalling in its entitlement. No thanks, Comrades.Reply 49 RecommendFrank Colorado Jan. 6
Diminished utility? How can they get that fourth mansion, complete with a set of cars and matching clothes in the closets of all houses? How can they get a second, bigger yacht? How can they get that private plane upgrade? That costs tens of millions. That is their utility. It just comes with much higher price tags. They need those things to be "part of the world" in which they live. That is how they can lend a plane or a yacht to a politician. It is how they show they are real people, not just those little tax payers. Readers may think I'm exaggerating here. I'm not. That really is their world. We are so far outside it we never see it, but it does leak into the press, only to be hushed up. Remember Mitt Romney's car elevator? That was paid for with the retirement funds of workers stripped out of closed companies wrecked by Bain Capital, a vulture capitalist firm. They have no retirement, but he's got a car elevator. Utility.49 RecommendHoward Boston Jan. 5
Luke 12:48: "For unto whomsoever much is given, of him shall be much required." You'd think all those good Christians on the right, even if they are not that much into economics could find some direction from the New Testament. Trickle Down is a Big Con. The president is the Grifter in Chief. And the GOP knows it. They just don't want to kill the orange goose that laid their tax rates (among other things).Reply 48 RecommendGary Bernier Holiday, FL Jan. 6
Assume the Republican congress had drastically cut taxes on everyone named Howard (either first or last name). Our extra spending would have stimulated the economy and created jobs. Could the reason that Republicans did not do this is that we Howards did not band together and give the Republicans massive campaign contributions? If we had, I am sure the Republicans would have claimed that the tax cuts to the Howards would have paid for themselves. This is the intellectual depth, or lack thereof, at which the Republican Congress operates.Reply 48 RecommendKagetora New York Jan. 6
The unfortunate truth is that there are really three kinds of Republicans when it comes to tax policy. The ignorant; those who have "faith" in the conservative shibboleth that low taxes drive growth and everyone benefits. Like most faithful, they deny facts and endorse lies that support their superstition. There are the brainwashed; people who might be capable of rational thought, but have been reciting the low tax mantra for so long they've stopped thinking about it and just repeat it from rote. Then are the cynics; people who actually know they are selling snake oil, but don't care because it is so lucrative to them and their financial supporters. These are the worst. They knowingly create misery and decimate the middle class for own economic advantage. It is time to put an end to Republican rule.47 RecommendJohn Marshall New York Jan. 7
Never-mind the validity of Alexandria Ocasio-Cortez's positions, which I totally support, but it's hard to understand the right's hysteria surrounding AOC, until we remember their similar hysteria surrounding Barack Obama. Let's not forget that he was a secret muslim who was born in Kenya and secretly wanted to take away our guns. What most irritated them was the fact that he was an articulate, charismatic, highly educated man who was BLACK, and try as they might, they were unable to make the lies and stereotypes stick. Now, we have an articulate, educated WOMAN who is HISPANIC, and they are breaking out the same tired bag of tricks. President Obama, both because of his character but also because he was highly conscious of the image he had to portray being the first black president, was always diplomatic and tended to ignore these racist attacks. AOC, however, grew up during the Obama years, and she saw what that battlefield looked like. I love the fact that she always fights back, quickly, intelligently, and bitingly. And each time she does, she shows up her critics as the hypocrites they are. Bravo.Reply 47 RecommendEd Watters San Francisco Jan. 6
@Freda Pine I'm thinking you have absolutely no idea how taxation works. No one would pay 70% on their income. They'd pay 70% on income over $X, which in AOC's instance is $10 million. But... let's take your wrong approach and say it's a flat 70%. You wouldn't "get out of bed" for $3 million? You must be quite rich. Not only would I get out of bed for $3 million, I'd show up early and go home late. At $300,000, you would be paying about 30% as a GRADUATED tax, not flat. Please, if you're going to post on this stuff, at least familiarize yourself with the BASIC concepts in taxation, like marginal versus effect rates.47 RecommendClaudia New Hampshire Jan. 6
Establishment Democrats are just as incensed by AOC's 70% proposal as Republicans, but can't say so, for PR purposes.Reply 47 Recommendheysus Mount Vernon Jan. 6
I don't give a hoot about female, of color or young. If she has solid ideas, that's all that counts. If taxing the billionaires works, I'm all for AOC. Personally, if you look at politicians for entertainment value, I much prefer her roof top steps to watching a mouth unconnected to brain standing in front of "that dump" the White House.Reply 47 RecommendAndrew Chapel Hill, NC Jan. 6
Atta woman AOC. Just what we needed. A women who knows something and speaks her mind. I'm all in. Tax em!Reply 47 RecommendOld blue Chapel Hill, N.C. Jan. 7
@Payton Some politician's pipe dream legacy project... you mean like a certain Border Wall? And everything you've talked about with wanting to keep track of money - X% in Education, Y% for Healthcare, Z% for Military Spending, is written down in the form of the Congressional Omnibus Spending Bill, passed every year. It dictates what money goes where as a combination of smaller appropriations bills. I suggest you read it. You might learn something. I would rather trust a (functioning) government with my money than a collection of wealthy private individuals or corporations, because I can participate in government. I can vote my President out of office.I cannot do anything to tell Tim Cook, or Jeff Bezos, or the Waltons to use my money more efficiently, or that I disagree with what they're doing. Conservatives love to whine about government inefficiency any say the private sector does it better, but that's simply because the private sector cuts corners to do it faster and cheaper. Those cut corners get people sick when water infrastructure breaks down prematurely due to mismanagement by a private utility company, or a large farm corp dumps its waste into the river system instead of going through proper disposal procedures. The government is not necessarily inefficient - it is Thorough.47 RecommendJason Dallas Jan. 7
@Billy Walker With all due respect, Mr. Walker, if taxation is theft, it is theft regardless of the percentage taken. Your notion that taxation becomes theft at a certain percentage is... just your notion.46 RecommendCharlie in NY New York, NY Jan. 5
@Mjxs "When did we begin to believe that mega-millions to CEOs will magically transform into wealth for all...?" We don't believe that, but we've been told that we do. Additionally, some of our less useful democratic institutions--the Senate, the electoral college--guarantee ongoing, electorally unearned power to the side that propagates this falsehood.46 RecommendAna Luisa Belgium Jan. 5
@SJP. In fact the EU and Scandinavian countries are facing great difficulties bordering on stagnation or worse in some cases. It is also useful to recall that since the end of WWII, these Western countries mostly outsourced their military defense onto the US - that huge savings was what underpinned their growth.46 RecommendNovember 2018 has Come; 2020 is Coming Vallejo Jan. 6
@George There's nothing like an anti-tax conservative who didn't even start fact-checking his own ideological prejudices ... The wealthiest 1% don't have a $200k income, but at least a $390k income, with an average of $1.5 million. Now can you please explain why asking billionaires to start paying back the debt (in part caused by massive tax cuts given to them, by the way) so that people who were never lucky enough to earn so much can at least have access to decent healthcare and education would be a bad idea ... ? How about putting America first, rather than the wealthiest 1%? Any objections?46 RecommendLew San Diego, CA Jan. 7
It's great to see that the age-old competitive male trick of casting every smart, well-spoken, attractive, or youngish woman as a dumb "nit-wit" has lost its power. People who aren't unsuccessful right-wing males know that such men are simply frightened by ambitious, smart, up-and-coming women. And, at long last, today's ambitious, smart, up-and-coming women are not one bit intimidated by men who insist on taking absurd potshots at them. This is wonderful progress! Go Nancy, go AOC, go freshman House Democrats!Reply 45 RecommendLuke NYC Jan. 5
@Freda Pine: No, economists are not physiologists. They're not philologists or entomologists either. So what does physiology have to do with any of this???45 RecommendLen Charlap Princeton, NJ Jan. 6
@Kenneth Johnson You are missing lots of things, including the fact that under such a system there would be more tax brackets for higher incomes (rather than one bracket for all incomes over $500k.) And the tiered system would still apply, so the 73% rate would only affect income above a certain amount. Re: moving out of the country, if your income is being generated in the US, it would be subject to US taxes. Maybe use your affluence and tax savings in Texas to educate yourself?45 RecommendJdavid Jax fl Jan. 6
Let's see if we can understand why tax cuts for the Rich or more generally, income and wealth inequality, is bad for the economy. Economists have a concept called the velocity of money. It is the frequency, how often, that money changes hands in domestic commerce. Here's an example. Suppose the government gives Scrooge McDuck a Billion for advice on the comic book market, If Scrooge puts the bucks in his basement, and forgets about it, that doesn't help the economy at all. That Billion has a velocity of 0. Also, if Scrooge loses a financial bet to Daddy Warbucks, and the Billion moves from Scrooge's basement to Daddy's, that is a change, but the velocity does not change because it is not a useful change. It doesn't affect commerce. Money going to the Rich has a lower velocity than money going to the non-rich. The Rich spend a lower percentage of their money. What's a guy or gal who already has so many houses he can't remember how many & an elevator for his horse gonna spend his money on? The answer is he is going to use it to speculate.There is a correlation between inequality & financial speculation. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1661746 Speculation is bad for the economy. That money has a very low velocity. AND it increases risk which we have seen in 2008 ain't a good thing. Since 2007, the velocity of money has plunged. https://fredblog.stlouisfed.org/2016/04/a-plodding-dollar-the-recent-decrease-in-the-velocity-of-money /45 RecommendM.R. Khan Chicago Jan. 6
I own three businesses and I as I write this on a Saturday night in a hotel away from my business trying to expand it I can assure the professor I would not be doing this at a 70 percent tax rate!the ivory elite economists who write this drivel has never owned a business created one job or made one payroll. Did you just see the last jobs report the growth rate after trump cut taxes .44 RecommendRima Regas Southern California Jan. 5
These frauds who claim economic expertise without any real academic qualifications include Larry Kudlow.Reply 44 RecommendJessa Forthofer Maui Jan. 6
@Fourteen This sense of entitlement by the white patriarchy is rooted in America's original sin. From an essay I wrote in 2016: "Now, there are three things that we must deal with and we're going to transform this neighborhood into a brotherhood. We've got to deal with the problem of racism. We've got to deal with the problem of economic injustice or poverty. And we've got to deal with the problem of war."" The issues King delineated for his audiences in the months leading up to his assassination are the very same issues present day candidates are grappling with – the only difference is that in the intervening fifty plus years, the three fundamental problems identified by King have grown exponentially. Inequality is far wider today. Today's poverty is far deeper and encompasses a much wider segment of America's population. https://wp.me/p2KJ3H-1Tb Nothing can change until we have truth, reconciliation, and reparations because if it is OK to go on without apologizing as a nation, then it is OK to go on exploiting the classes in cycle after cycle of economic ups and downs and cycle after cycle of racial divide and conquer.44 RecommendAnother Joe Maine Jan. 5
I read this article as I sit on a patio at my Airbnb in Maui, looking out across the ocean. My girlfriend and I worked hard and tucked away any extra pennies we had for this vacation - doing so for a couple years. We are here to celebrate her 30th birthday, and it feels rich and lovely because this trip was hard-earned and marks a goal accomplished. It is unlikely we'll take another vacation like this for quite some time. The thing that strikes me the most as I read this article is that I sit here looking across the water toward the island of Lanai. Larry Ellison of Oracle owns 98% of that Hawaiian island (where the Dole pineapple plantation used to be). It is not a small island. Why do the rich need such things? Why is it reasonable to say that an individual man should even be able to purchase such a lavish, absurd amount of this beautiful paradise (and then only really allow the extremely wealthy to visit at the Four Seasons there, where a "bad" room runs over $1000 per night)? Why? The rich are not taxed enough.44 RecommendFourteen Boston Jan. 6
I'm not sure if this is still strictly true, but as of a couple of years ago the richest woman in the USA was the widow of one of Sam Walton's (i.e., Walmart) sons. In other words, the wealthiest woman in America was the heiress of an heir of someone who actually created a business. In case that isn't quite clear, the richest woman in America is someone who never, as far as is known, never did a lick of actual labor in her life. What is utterly astonishing is how many people have been brainwashed to believe our system is actually a meritocracy, and taxes on the wealthy are taxes on people who earned their wealth by the sweat of their brow. . .Reply 43 RecommendMiriam Chua Long Island Jan. 6
@Socrates The Rich have rigged the system to favor themselves against us. They don't know how to make money the old-fashioned way. They'd be lost in a competitive market. Instead, these Takers live in an alt-reality echo-chamber slapping each other on their backs for being "Makers." The Progressives see them clearly as parasites.43 RecommendJames Thornburgh San Diego Jan. 7
"...Republicans almost universally advocate low taxes on the wealthy, based on the claim that tax cuts at the top will have huge beneficial effects on the economy." Trickle-down economics, voodoo economics; when will people stop accepting this drivel, which was disproven by Reagan? As for the average middle-class American, what I find remarkable is that most people want lower taxes AND more services; I read letters in Newsday about it all the time. Totally illogical.Reply 43 RecommendSuzanne O'Neill Colorado Jan. 5
@romanette Well said.43 RecommendFourteen Boston Jan. 5
@Andy The quote that comes to mind is, "It is difficult to get a man to understand something, when his salary depends on his not understanding it." - Upton Sinclair42 RecommendSandraH. California Jan. 5
@Bruce Rozenblit I would add another prime motivation beyond wealth and power and control. For those with wealth and power in excess of what they could ever need, why do they continue to arrogantly pile it up regardless of the cost to others? I believe it is fear - the fear that people will object to the imbalance and try to right it. Great wealth and power engender insecurity. The Rich are afraid of us.42 RecommendGwe Ny Jan. 5
@Plennie Wingo, true. Our first tax reform should be to tax all income at the same rates. We should also eliminate different tax schedules for tax payers, depending on their marital status.42 Recommendch Indiana Jan. 5
@Barking Doggerel Yes and no. In today's world, male privilege has given you that view. However, and this is not a small point, that is YOUR view. In reality, MOST people at the top marginal rate that *I* know are not merely CEOs. The people that I know, peeps that would qualify for this tax hike, are the upper managers, high wage earners, typically at the height of their career. They tend to be first generation high earners...otherwise they would not need to work in this manner because their investments would otherwise feed them. They do not have independent wealth but they are trying desperately to accumulate it. Because they typically live in one of the two coasts, they tend to have high property taxes and a high cost of living. They have the means to pay for their kids education, but they worry about their children ability to build on their current success. In my experience, the high earners I know come in different flavors and nationalities. They only thing they all have in common is achievement: academic and economic. But I will tell you something I do know about the CEO types and they don't grow on trees. Try and recruit talent and not pay them. You won't be able to.... and it will make a difference to the bottom line, because I have seen it. This plan will push down the upper middle class down the way that the GOP already decimated the other middle class. To combat income inequality, close the "Mitt Romney" loopholes.42 RecommendLarry L Dallas, TX Jan. 6
The wealthy CEO's don't even work an extra hour for that extra $1,000. They just negotiate for obscene amounts of compensation that they cannot in any way spend. There was a study awhile ago - I think I read about it in the NYT - that suggested that a higher marginal tax rate might reduce the incentive for CEO's to negotiate for higher and higher compensation, because that would bump them up to a higher marginal tax rate. If that is correct, then corporations would have more to pay ordinary workers, and income inequality would be reduced.Reply 39 RecommendDavid Andrew Henry Chicxulub Puerto Yucatan Mexico Jan. 5
@Gwe, frankly, I think the executive management of American companies back in the 1950s and 1960s were more competent because they were better at balancing the needs across a number of constituencies. Even after adjusting for inflation, they made much, much less. Now THAT'S value! What has changed is an attitude of me-ism that an older generation that had to survive WWII and the Great Depression did NOT have. Unfortunately, that sort of zeitgeist died with them and the country is poorer as a society for it.39 RecommendMarjorie Riverhead Jan. 5
Paul, in your previous column you noted that corporations were sitting on a mountain of savings. The money is mostly in foreign banks, because the corporations don't want to bring it home, because they can't find good investments. I recently visited with a retired Canadian banker who said his best years were when he was working with young entrepreneurs...contractors, builders, small business owners. He watched them grow and helped through some of the rough parts. Is there something wrong with today's bankers? (Everyone please revisit The Big Short) Back to today's tax story. About forty years a go I needed three American engineers with experience we couldn't find in Canada. They didn't want to come..."taxes are too high." I explained that their private health insurance was a tax. When we factored in the cost of US health insurance they would have more after tax income in Canada. They came to Canada. Please continue to write about taxes. Thank you. Ancient Canadian economist In a Mayan fishing villageReply 39 RecommendIgnatius J. Reilly N.C. Jan. 6
My dad owned a small business on the Gold Coast of L.I. during the 60's which catered to old money WASPS whose wealth was taxed at upwards of 90%. However, they all "summered" on L.I. or Cape Cod, had homes in Manhattan, Paris, London and yachts in the Caribbean. And, as a middle class young adult, I was able to attend community college for $50 per semester. That's when we had real upward mobility, a dynamic economy and a strong middle class.38 RecommendDave Lafayette, CO Jan. 6
Who is this "The Rich"? Let's face it, it's sort of a Boogeyman. The REAL tax amounts come from BUSINESSES. BIG BUSINESSES. And that's who should be taxed and taxed well. There shouldn't even be an individual income tax. Everyone's income comes from a BUSINESS one way or another and should be taken out and adjusted for on the Business end. And as we know Business just got a HUGE break under Trump and the Republicans.Reply 37 RecommendEd L. Syracuse Jan. 6
As Mr. Krugman is often fond of saying: "Your spending is my income, and my spending is your income." Or, to quote Barack Obama in 2008: "When you spread the wealth around a bit, it's good for everyone." For his quote above, Obama was eviscerated by the Right for "advocating socialism". Of course for those who believed Saint Ronnie when he said, "It's all YOUR money" - ALL taxation is "socialism". That would be the GOP's mantra if it wasn't for the military-industrial complex (socialism for defense contractors). But I digress. The message behind both the Krugman and Obama quotes above is simply that we are currently on a political and economic path to neo-feudalism (where the Lords own 90% of the wealth and we Serfs squabble over the remaining crumbs). By contrast, "everyone" benefits from a European-style "social democracy" - where government actually "provides for the General Welfare" so the average citizen doesn't have to worry much about food, clothing, shelter, education and health care. These basics are the foundation of Maslow's "hierarchy of needs". Once these basic needs are met, citizens are free to concentrate their energies on "productive pursuits" (whether that's earning more money or writing a symphony). And everyone (even the wealthy) suffers from far less stress than in our current jungle system where most Americans literally struggle from paycheck-to-paycheck - just one illness or job loss from total destitution. Yet we continue to vote for serfdom.37 RecommendMytake North Carolina Jan. 7
Never in the field of human conflict has so much been written about one who has accomplished so little.37 RecommendRich Fairbanks Jacksonville Oregon Jan. 6
@Jason Let the wealthy flee and see if living outside of the USA on a daily basis holds much of a candle to living every day in the USA (e.g., Seattle, LA, or NYC) to name a few. Good luck.37 RecommendRudy Berkeley, CA Jan. 6
I own a small forestry company. Despite a competent tax preparer I pay well over 20% in federal income taxes. A large forestry company (Weyerhauser) with billions in revenue pays 0% federal tax. AOC knows exactly what she is talking about.37 RecommendJohn Mardinly Chandler, AZ Jan. 5
@Thomas Zaslavsky There no way to create wealth other than inventions and discoveries that 20-21st century science has shown us. All the other money making schemes are either rent seeking or exploitational. So the way we compensate scientists and scientist makers (teachers, aides etc) is so flawed that our sustainable scientific growth is in jeopardy (check the time it takes a PhD in biology to get a permanent job!). I don't see CEO any better than the scientists I've met in my life. The only difference is that CEOs are uber competitive whereas great scientists are excellent collaborators. There will be no capitalism, only feudalism without scientific discovery and inventions ... stop lionizing the CEOs.36 RecommendKim Terre Haute Jan. 7
It's time to end the salary limit for Social Security taxes. Also, people like Warren Buffet, who don't get a salary but make their income from dividends, should pay into Social Security by a 'Payroll Tax' on dividends.36 RecommendRudy Berkeley, CA Jan. 6
@Jason People and capital are not more mobile than they have ever been. The median income in the US has been stagnant for decades, and the buying power of that income declines every year. This is happening as the ultra-rich see tax breaks and hundred-percent increases in their income.36 RecommendMike Tucson Jan. 5
@Allan Reagan I've seen 100s of scientists who forego consumption, risk their life on finding truth (less than 1 in 10 PhDs land permanent jobs in Academia presently) that in turn help move the 20-21st century machine into creating wealth for all. I don't see them asking for 10 million plus to get rewarded. Einstein refused a pay hike at Princeton to $8K (present value $40) but without him there'll be no internet, mobile phones etc for supposedly "self-made" men (yes men) like you to make money from! We're all incredibly hard working like you (mothers, teachers, drivers, painters etc). You're incredibly lucky to make 10 million plus! Modesty would be a nice gesture ...36 RecommendFrom Where I Sit Gotham Jan. 5
I wonder what our country would be like if we had the same distribution of income by deciles as we had in, say, 1980 before the Regan tax cuts and subsequent cuts. How much more money would people in the bottom three quartiles have in their pockets? With more money to enjoy life, could productivity have continued to increase rather than decrease. I suspect with all of that money in their pockets they would have consumed more, GDP growth would have been higher, there would have been less impetus to drive work to cheaper labor markets in Asia because people could afford things from higher labor markets like the good old USA. We would have more money to invest in infrastructure. We would have enough money for universal health care. So in turns out, I believe, the Republican tax policy is just one big scam to create a landed gentry in this country, something I doubt the founding fathers would be ok with having just gotten out of a country where the landed gentry were everything. And my having a universal health care growing at GDP rather than 2x GDP, would would have a low cost and better health care system.36 RecommendGary Monterey, California Jan. 7
Please don't repeat what you wrote here. It is tragically WRONG though it is widely repeated! No one pays 70% on ALL their income. Each tax rate applies ONLY to monies in that bracket. If a theoretical 70% applied to income above $10,000,000, and someone made $11,000,000, then they would pay the rate of 70% on $1,000,000. Furthermore, if there is an exemption for the first $12,000 of income, and a rate of 5% from $12,001-$20,000, then you, me and our millionaire example would all pay no tax on the first $12k, $399.95 on the next bracket and so on. The end result is what's known as the effective tax rate and that's the progressive part of it.36 RecommendEllen San Diego Jan. 5
@Billy Walker Sigh .... another failure to understand the meaning of marginal tax rate.36 RecommendJohn Quinn Virginia Beach Jan. 6
@Red Sox, '04, '07, '13, '18, I think if you scratch them deep, many very wealthy people in the U.S. would like to see better infrastructure, universal healthcare, more people in homes than on the street, etc., plus a progressive program to deal with climate change. And if a logical, sensible tax proposal could be put forth, they would vote and help pay for it, slowing our nation's slide toward becoming a third world country.36 RecommendYuri Asian Bay Area Jan. 5
Progressive taxation is a fraud and unfair. Everyone should pay a flat rate; around 20%. There is no reason not to tax all taxpayers with the same rate.Reply 36 RecommendJohn D. Out West Jan. 6
Jesse "Big Daddy" Unruh -- when he was California State Assembly Speaker ran against incumbent Gov. Ronald Reagan in 1970 promising a confiscatory tax of 100% on income above $1 million a year. Unruh, known for his quip "Money is the Mother's Milk of Politics" ran as a progressive populist against Reagan, who was re-elected with a decisive margin of 52.8% to 45.1%. Post-election Analysts were surprised that working class Democrats rejected Unruh because they said they strongly opposed his 100% tax on all income above $1 million annually. After Unruh lost there was an apocryphal interview with a taxi driver who said "if I make more than a million a year I don't want the state taking it away." When the reporter asked the cab driver if he really thought he'd ever make that much, the cab driver said "who knows, I might get lucky." Stamped on the politically modified DNA of too many working Americans is the fable that everyone is just a sliver of luck away from tycoon wealth. It's a fantasy of American Exceptionalism that explains the celebrity and allure of privatized wealth trumping common good and common sense. To paraphrase Marx: Money lust is the sigh of the oppressed creature, the heart of a heartless world, and the soul of soulless conditions. It is the opium of the people". To misquote the late Carter Ag Secretary Bob Bergland, "the rich know the cost of everything but the value of nothing." Amen to that.36 RecommendTony Long San Francisco Jan. 5
@Ron Cohen, exactly right. A reduction in incentive for the ultra-wealthy to make an extra million or two also can help reduce the cutthroat nature of this economy & society. What would the rich guy have to do to add that extra couple of million? Lie about the asbestos in his company's talcum powder? Ignore product safety standards to save on manufacturing cost? Fire a wad of people and drive the remaining skeleton crew over the edge into stress-induced disease? Find a way to get that toxic waste off your hands, say as an ineffective, downright toxic fire retardant for furniture and baby clothes? Anything society can do to lower the probability of outcomes like those is a significant benefit for all.36 RecommendAndrew Zuckerman Port Washington, NY Jan. 5
"So why not tax them at 100 percent? The answer is that this would eliminate any incentive to do whatever it is they do to earn that much money, which would hurt the economy." And yet, as both you and Thomas Piketty have pointed out, most of the wealth being generated now is through investment, in other words making money from money. So nothing useful is being produced and these people are not "job creators." Go ahead. Tax them at 100 percent.35 RecommendEllen San Diego Jan. 7
@Matthew Carnicelli America isn't happier but rich Republican donors are. Republicans work for their rich donors, not for America so the party is just doing its job.35 RecommendNelson Austin Jan. 5
@Mjxs Rather than restore the draft, have a national conversation on our outsized military, and its (our?) goals. Perhaps reducing its budget significantly, instigating universal community domestic service for all our youth, and giving some of the savings to repair our tattered safety net would get us to where we would like to be.35 RecommendRyan GA Jan. 5
@Geoffrey Please read the comment from "Barking Doggeral," I think it answers your question. Basically, "super compensated" does not equal super productive by a long shot.35 RecommendJim California Jan. 5
I'll tell you how Ocasio-Cortez will perform as a member of Congress: She won't. She is too intelligent and her policies are too sane and sensible to mesh with the crooks and corporate shills who control our modern political system. The people want wild, outlandish, showbiz personalities, not a return to the stable social democracy that made us the greatest country in the world during the 1950s. AOC may know how to use Twitter, but unlike Trump she doesn't know how to use fear and deceit to influence an entrenched profit-driven plutocracy, and unlike Trump her ideas won't allow global megacorporations to consolidate their money and control over us so any hope of financial support is out of the question. And her ideas concerning policy would promote America's strength and stability, something that our foreign enemies will fight tooth and nail to prevent. With no corporate cash and an army of foreign agents and their Republican employees undermining her, AOC's agenda will go nowhere. Furthermore, she will accomplish nothing in Congress because there is no Congress. Trump has eliminated it. The shutdown is not a means to the end of building the wall. The Wall fight is just a means to an end: Trump and his followers want the government to remain shut down. They want to undermine our government and punish Federal employees by putting them out of work. Their motivations are resentment, spite, and the driving need to hurt Americans. Trump's goal is two branches of government.35 RecommendDoug Brockman springfield, mo Jan. 6
Facts are always disconcerting because they challenge beliefs and in this situation sense of personal self worth amongst the highly compensated.Reply 35 RecommendJim Muncy Florida Jan. 6
Imagine yourself a cardiologist making 900K a year. Now imagine taxing his income at 90% inclding state taxes. How likely is he to get out of bed at 3 AM to do y our emergency angioplasty, since his income depends on aperformance based compensation model and his sleepless night, before working the next day as well, isnt going to earn him beans a fter taxes?35 Recommendmpound USA Jan. 6
Yes, but 80% -- holy cow! That just sounds outrageous. It's very bad optics if nothing else. How can the IRS agent, with a straight face anyway, demand, "Okay, buddy, for the privilege of living here, you owe us eight out of every ten dollars you earn." Really? Isn't that absurd overreach? No? It's fine with me personally: I'm poor, living on a modest Social Security check. It's also fine with me if you outlaw booze and cigarettes, too, because I'm not a patron. I've no skin in these games. And I do love the idea of financing our deeply in debt, democratic government and helping the poor, I'm one of them, but, yeow, 80%? That's going to be a hard-sell just on the face of it, although I concede to the wisdom of my superiors -- the Ph.d. economists, especially the Nobel-Prize winners. Just as I did when called upon to fight the noble Vietnam War. They know more than me, right? So, AO-C, carry on, girl. You have the money gurus behind you, while this layman remains bemused, stymied, and not a little red-faced by the paradox, appropriateness, and effectiveness of an 80% tax rate. Holy cow! Good morning, Vietnam.Reply 34 RecommendVan Owen Lancaster PA Jan. 5
"The controversy of the moment involves AOC's advocacy of a tax rate of 70-80 percent on very high incomes, which is obviously crazy, right? I mean, who thinks that makes sense? Naturally, Krugman and the cocktail waitress/tax policy savant known as "AOC" don't even bother to define what constitutes "very high incomes", which demonstrates just how poorly thought out their magical thinking really is. Try again, Paul.Reply 34 RecommendJoe Public Merrimack, NH Jan. 6
Great article. No need to argue the point. Raise tax rates on those earning north of one million to 73%. Just do it. Now.34 RecommendAnatomically modern human At large Jan. 7
Taxation is theft. It is wrong to tax people at 70%, because you are stealing from them.Reply 34 RecommendPeter Z Los Angeles Jan. 5
". . . a tax rate of 70-80 percent on very high incomes . . . is a policy nobody has ever implemented, aside from the United States, for 35 years after World War II -- including the most successful period of economic growth in our history." I've been waiting for decades now for someone to notice this. For several years during world war II, the top tax rate was 95%. It dropped a bit at the end of the war, but by 1950 it was back above 90%, and there it remained until 1963. When vast amounts of public money flow into private pockets in the form of defense spending, which has been the case since the 1940s, high marginal tax rates are what keep public money public. Anything less amounts to a huge transfer of wealth from the poor to the rich. Which is exactly what's been happening since the Reagan-Thatcher years. Call it "socialism for the rich". It's time to get back to the common sense policies of working for the common good, and that means progressive taxation.34 RecommendSteve California Jan. 5
Paul.....Taxing the wealthy is the ONLY way to provide income equality to all Americans. The rich never, ever, make their money without the Democratic Capitalistic system for them to operate within. The US infrastructure, the laws, the labor of the many, and other common benefits to all businesses provide Americans the opportunity to build personal wealth. If the wealth Gap gets too big, the many "have nots" will revolt. It's in the interest of the 1% to make sure the 99% is taken care of. It's a matter of survival.Reply 34 Recommendhikenandclimbin MV, WA Jan. 7
Currently the 1% own 50% of global wealth, they will own 66% by 2030. Left unchecked, they will eventually own virtually all wealth, which reduces you and I to serfs, and is intrinsically unstable. The reason for this is simple: the return on capital is about 6-10% while GDP growth is 2-4% which means that wealth will accumulate with those who own capital: aka: the rich get richer. That is a systemic outcome. The solution is simple: tax at the top, invest at the bottom.34 RecommendTom New Jersey Jan. 5
@Jason You clearly didn't read the editorial: Why is it that the Conservatives never articulate a policy proposal based on factual analysis ? Because, much like Jason's suggestion that he would move his business out of the country & Jason's criticism that the left's answer is soak the rich, has no basis in reality. Jason may or may not move his business but this of little consequence as his 'income' would be distinct from business profit. & the notion that the rich are soaked is difficult to reconcile with our current economic situation. The Far-Right seems to misunderstand how tax structure works & how tax income is used. Jason's suggestion that the private sector applies superior critical thinking skills is belied by his comments & this is driven home by the mere fact of his comment being an 'Times Pick'33 RecommendGeoffrey Dallas Jan. 6
@SJP The only country that has tried a marginal income tax rate above 55% recently (France, 70%) abandoned it as unproductive, i.e. it wasn't collecting much because people successfully avoided paying it. That speaks more to me than what may be optimal in theory. With state and local taxes added in, marginal tax in US blue states is already about 50%. An 80% tax rate is a political fantasy, even in Sweden (total top marginal rate 56%)33 RecommendLaurie USA Jan. 6
It sounds like a strategy to discriminate against a minority group based solely upon the one characteristic that defines their minority status - their income. No law-abiding group should be targeted for disproportionate, punitive taxation based upon their income. The ultra wealthy, who broke no laws while attaining their wealth, should not be financially exploited after the fact simply because the majority would like to siphon off their wealth rather than innovate and work for their own. Who are you, or anyone else to say how much of a person's hard earned income is "enough for them" or to decide how "bothered" they will be if you forcibly take the portion of their money you've deemed to be excessive. What have you done that entitles you to deserve any portion of another person's earnings? I could find a large group of impoverished, homeless people who would feel that the middle-class income you earn is too much for you and that you should be forced to distribute any amount over a subsistence income to them since they are less fortunate than you. I doubt you'd be as quick to advocate for their claim to your money as you are for your own claim to the money of the wealthy.33 RecommendRudy Berkeley, CA Jan. 6
@Annie. "What if we stopped believing that government could fix all of our problems?" The US Constitution is written so that the Federal Government provides for the common good. If we stop believing that, we might as well move to Russia.32 RecommendMeredith New York Jan. 6
@dmckj So Denmark is Cuba?32 RecommendBenjamin ben-baruch Ashland OR Jan. 6
Of course Repubs say tax cuts for the rich will benefit the whole economy---that's you and me. What else can they say---the truth? That they want to confiscate our national productivity---meaning what you and me produce at work? Because it's their due, as superior beings who call the shots? Then decide how little to pay you and me in return? Or that it's perfectly ok to send our jobs away to low wage countries, and leave us to scramble? Can they say that they should dominate our govt like the aristocrats of olden days? Those ones we overthrew way back when? No, would sound awful. So they and well paid consultants make up these economic slogans---and millions believe them! And many go along with it to be in with the influential and powerful. The politicians taking donor money spread the lie. The big con is to equate corporate wealth with Americanism and Freedom. They manipulate us with the implied threat and contrast of a true Communist dictatorship where the govt owns everything. But as Krugman's favorite 2016 candidate Bernie Sanders said---Yes, of course we want capitalism, but regulated capitalism! If elected govt doesn't regulate corporations then the corporations will regulate the govt. That's what we have now, disguised. Btw-- PK says, " if a rich man works..." How about if a rich woman works? Or rich person, Or rich people. Times have changed. Hard habit to break. Man is not synonomous with humanity.Reply 32 RecommendBlank Venice Jan. 7
Wow! A congressperson who understands economics and who can dance too!Reply 31 RecommendJW New York Jan. 7
@Allan Reagan I had an accountant in my early days of entrepreneurship who wisely explained to me that paying taxes was far better than not paying them. He was right, as I earned more income, I paid more taxes and became more successful so I could earn more income and pay more taxes. Paying the 70% rate on your earnings over $10m means you already earned $10m. In a year. Now stop complaining already.31 RecommendMarc Herlands San Diego, CA Jan. 6
@Billy Walker Regardless of whether we are talking about marginal rates, the idea that taxation is "theft" is something that the wealthy have been pounding into the heads of the population for decades now. If that were true, then those that don't want to pay taxes should not be permitted to use OUR roadways, or seek protection from OUR police force, or expect their trash to be picked up by OUR sanitation workers. If and when a natural disaster strikes and your home is destroyed, please don't look to US for relief. If you are in trouble in a foreign country do not look to OUR embassy. When you want to sue your business partners or you get into an accident and need to sue the negligent party or even when you are arrested and accused of a crime, please don't look to OUR courts for redress. If you have not paid for these services, please don't steal them from those that have paid. Also, if you have a business, please do not steal the use of OUR railways, roadways, bridges and tunnels, postal system, shipping ports, waterways, rivers, lakes, airports, airways, traffic controllers, etc. Because the more you are making, the more you will be using OUR infrastructure and services. Get your own and stop putting such heavy demands on what is OURS. Freeloading rich people will not be tolerated despite the fact that they are and always have been amongst the most self entitled people to grace this country. Pay your taxes or stop stealing.30 RecommendSteve Crouse CT Jan. 5
Eisenhower said that high marginal income tax rates on wealthy people and corporations was not socialism but sound economic policy. He said corporations would pay a greater portion of their profits from increased worker productivity to workers rather than pay an increased amount in taxes to government. For decades workers received annual increases in wages and benefits when marginal income tax rates were high. Then Reaganomics was introduced which lowered greatly those marginal income tax rates on wealthy people and corporations while raising payroll taxes on workers and businesses. The result has been no growth or loss of real income for 90% of the country, a small to moderate gain for the top 9%, and a huge gain in real income for the top 1% of income earners. Businesses gave bonuses to management for increasing before tax profits. They did this by reducing the growth rate of wages and benefits and moving production to Mexico and China where wages and benefits and regulations are much less than in the US. It has been goodbye good industrial jobs and hello to bad service jobs for the past 35 years. It's time to go back to that which helps most people and not the top 1%. Goodbye to trickle down economics which has never worked to help the bottom 99%.Reply 30 RecommendAlexanderTheGoodEnough Pennsylvania Jan. 6
@Ellen All correct, our infrastructure has already become third world. Next time you're stuck in traffic under a bridge, look up at the rusted steel and spalled concrete. I do this often because I've been involved with road construction all my life and I'm aware of the collapse of our infrastructure. However, few people ever look up at a bridge when below it, and don't recognize what they see. The politicians don't look either, but the engineers do.30 RecommendJack SF Bay Area Jan. 6
What's good for the USA is good for General Bullmoose!! https://youtu.be/Kj65AcbekIE I've been saying this for years. The wealth of the wealthy is founded upon and maintained by the prosperity of America's working people. Those among the ±1%, and most especially the 0.1%, who are not sociopaths ("It is not enough to succeed. Others must fail." ~ Gore Vidal et al.) must realize that the best investment that the well-to-do have ever made in all of human history was in America's infrastructure and its middle class during the 3+ decades following WW II. Even though at the time the taxes on the wealthy were overly confiscatory, not only did it result in remarkable economic prosperity for all, including the wealthy, it also meant that the wealthy could sleep safely in their beds and not have to cower behind walls and private armies for fear that their heads might end up on a pike. Sadly, those days seem to be passing. A person with no hope can be deadly, so, as the people lose more and more, the rich must, perforce, fear more and more. Some of them know that, and know better, but... "We must make our choice. We may have democracy, or we may have wealth concentrated in the hands of a few, but we can't have both." ~ Justice Louis D. Brandeis When John D. Rockefeller was asked once, "How much money is enough money?" He replied, "Just a little bit more."Reply 30 RecommendMolesh NY Jan. 6
It's not just higher tax brackets for the wealthy. It's also tax breaks on dividends as opposed to dividends as well as all of the other tax breaks that rich people receive. It's also unaudited and untracked overspending on the military, subsidies for fossil fuel companies, and all of that stuff. The result is that young people pay for their education for the rest of their lives; roads, bridges, railroads, airports, water systems, etc., are in a state of advanced decay and our society as a whole is suffering from structural deterioration. So good for Krugman and Ocasio-Cortez. It's about time.30 Recommendsjs Bridgeport, CT Jan. 5
Taxing the rich at 75% is a fools errand. President Holland tried only to see rich leave France. In a global economy, the rich move, when taxed too much, (in their opinion) to where taxes are lower. It is just as lovely to live in London - with the source of your income conveniently located in the Channel Island) then in NYC30 RecommendThomas Zaslavsky Binghamton, N.Y. Jan. 5
@WPLMMT I am a liberal and a progressive and what I want is for the ultra rich to stop grabbing everything for themselves aided by unfair tax laws and bought politicians. Write back in 2.5 years, WPLMMT, and see if your prediction about her longevity comes true. I wouldn't take the bet, if I were you.30 RecommendJMM Worcester, MA Jan. 5
@Robert Orban Reagan did not do it. Volcker did it, with the approval of Carter, before Reagan became president, and continued the same policy under Reagan.30 Recommendbud mckinney Jan. 6
@Ron Cohen A bigger contribution to the "why" is the changes in accounting rules on options and stock compensation. This plus the SEC rule changes regarding advanced advice (forecasting company performance) have allowed executives to play the expectations game and manage their payout.29 RecommendKaty NYC Jan. 7
Krugman,as usual,you are wrong.When you pay 70% or more in taxes;what is your incentive to work.The people taxed at the 70% rate will leave,just like France.Then France reduced the tax rate.Cortez is an individual with scant knowledge of economics/taxation.I find it amazing she grew up in affluent Yorktown Heights in Westchester County yet wants us to believe she's a poor hispanic from the Bronx.Reply 29 RecommendCharles New York Jan. 5
@Billy Walker Under Dwight D Eisenhower, taxes on the wealthy were much higher percentage. Ocasio regurgitated a Republican's tax plan and called it her own. During Ike's tenure, those monies were used to build the greatest infrastructure America ever built, and the last time America made any meaningful investment in our infrastructure - because Reganonomics paved the way to decrease taxes on the wealthy and there went America's infrastructure monies. Why are you so determined to make sure the rich get richer?29 Recommendlester ostroy Redondo Beach, CA Jan. 5
@Geoffrey "Why not punish the unproductive with high taxes as an incentive for them to become more productive".... It's rich to imply someone making $20 an hour is unproductive as opposed to one born to the investor or heir class who may have never lifted a finger or even earned their original wealth in the first place.29 RecommendDenise Johnson Claremont, CA Jan. 7
@Plennie Wingo When considering tax rates, the so called payroll tax should be folded in. Most observers of our tax rates seem to forget that part of the deal. Since the government uses the payroll taxes collected no differently than it uses any other funds collected, I think it would be smart to get rid of it altogether. Right now, the payroll tax, which is supposedly funding Social Security and Medicare has a surplus every year and is added ludicrously to the national "debt." Let's get rid of all of these fictions and start over so that the actual taxes everyone pays will be more equitable.29 RecommendMark Portland, ME Jan. 6
@Billy Walker So who cares about the data, history, experts- you know what you know. Our current tax laws have been written by the rich & corporations. Do you think that is why they favor the rich & corporations with little regard to what is best for our country? I do.28 Recommended connor camp springs, md Jan. 5
I think this quote by Mr. Krugman is a dangerous mentality to have for us citizens. "Or to put it a bit more succinctly, when taxing the rich, all we should care about is how much revenue we raise." Boy could this logic justify some madness down the road.28 RecommendEllen San Diego Jan. 5
Capital, and capitalists, can flee. It's why the Beatles left the U.K. in their prime. Remember "Tax Man"? Paul, you more than anyone have spoken about the fact that capital knows no borders; it just seeks the highest return.28 Recommendjas2200 Carlsbad, CA Jan. 7
Isn't a major elephant in the room the amount of our taxes that goes to (Eisenhower's famous phrase) the Military Industrial Complex? As Martin Luther King said :" A nation that continues year after year to spend more money on military defense than on programs of social uplift is approaching spiritual doom."Reply 28 RecommendMidnight Scribe Chinatown, New York City Jan. 6
@Allan Reagan: If you are making under $100,000, you won't be hurt by the higher tax rates Democrats, including AOC, are talking about. AOC floated higher rates on income over $10,000,000. I think you are safe.28 RecommendAKJ Pennsylvania Jan. 6
The future has arrived and we'll do anything to stop it dead in its tracks. AOC is a symptom of the future, not the full-blown terminal illness lying in wait for the oligarchy. Beto O'Rourke may also be a symptom of this new dreaded epidemic. The GOP has been doing this smoke-and-mirrors act with the economy for decades: the "job creators" who can't be taxed, the efficient markets which result in a major financial catastrophe every ten years, the "competition" which only results in the consolidation of economic control and power in the hands of a few big corporations (monopolists) and big banks. And the whole thing runs on free money - zero interest rate policy - or effectively zero when inflation is factored in. We have a cult. A cult of "conservatism" which is profligate, wasteful, irresponsible, fatuous, anti-scientific, anti-fact, and anti-intellectual. Cults work better without facts. They're hostile to fact. And cults are dangerous like ignorance, and greed, and chicanery. Conservative = Insurgent. Up = Down. Donkey = Aristotle. And doesn't it sell like hotcakes along with those $40 red hats...Reply 28 RecommendMij Sirron California Jan. 6
@sharon Not to mention how Mitt shoveled a bunch of options into his retirement account without having to pay taxes on their full value.28 RecommendScott Texas Jan. 6
Great idea, let's raise more tax money so that we can do truly productive activities such as flying dead ex-presidents and senators across the country (several times) in 747's. Maybe they needed the security or were in a hurry to be buried. Then, of course, look at the great value-for-dollar we get from military spending.Reply 27 RecommendWizarat Moorestown, NJ Jan. 6
I don't need some 29 year-old who has never started a business, made payroll, created something that didn't exist before, took the chance, made the investment, and suffered the many setbacks before the idea was a success to tell me how I should or shouldn't spend my money. Taxing it is the same as saying how I should spend it. I also do not need an academic who has never started a business, made payroll, created something that didn't exist before, took the chance, made the investment, and suffered the many setbacks before the idea was a success to tell me how I should or shouldn't spend my money. Taxing it is the same as saying how I should spend it. Both of these folks are sad examples of the "let me tell you what is best for you" paternalistic, liberal ideology that we should all be very afraid of.27 RecommendWorldPeace2017 US Expat in SE Asia Jan. 6
Professor Krugman, AOC is no flake and the Republicans know that. Trumpian Republicans are running scared of the new freshman class of 116th Congress as it is the most diverse and educated ever. They are looking for ways to discredit these young, energetic, and educated Representatives of the People who came/got elected to take back the Government from the Corporations. They promised to make it work for all the people. Just to add one more item in your list of why we should tax the top 1% with a 70%-75% tax rate is the fact that the utility of extra money to people with middle and low income is certainly very high as compared to higher income folks/corporations. The marginal propensity to save is almost zero for extra money received as a result of tax cuts/reductions in the lower income individuals, essentially they are going to spend all of it in the local economy to obtain the necessities of life. This extra money spent in the economy would have a major multiplier effect in the economy. We do live in a consumer based economy. The revenue generated by taxing the extremely wealthy individuals/corporations would go a long way to fund a lot of Progressive ideas/values for our citizen. The freshman class of 116th Congress gives me a lot of hope for the future of our country.27 RecommendnotBillWalker New Britain, CT Jan. 7
@paulkrugman You have stated things I learned 65 years ago in my first economics class when good teachers were proud to say the names like Samuel Gompers and the like. Thank you. You were right about the timing and prosperity that the US had in the period after WW II. The US growth rate was doubling every 11years, as shown in graphs on The Guardian on 5 January. Only after Reagan did the US begin a real spiral down in growth, but still ahead of all others except China. Real productivity increases are hindered by some almost immovable obstacles; Greed by the rich, over weight among all groups and failures in educating/inspiring the masses. The three are global phenomenons but only addressing the first can lead to having the wherewithal's to address the other 2. I look forward to reading and following @AOC in her work in the future, she has great guts. I'm with her.Reply 27 RecommendPrede New Jersey Jan. 7
@Billy Walker It's a marginal tax rate, Billy. You're not going to be paying anywhere close to 70%.27 RecommendJoel Sanders New Jersey Jan. 6
@Jason Capital controls, high tariff walls, and high interest rates fix this. You know what the united states had from 1947-1970ish26 RecommendDave From Auckland Auckland Jan. 5
Mr. Krugman's citation of a utility analysis lacks a grounding in property rights, which arguably define and distinguish the US from all other political economies. That said, if we want to use utility as the standard of value, then let's use rule-based utility vs. act-based utility. On that standard, how have the socialist / communist / so-called "progressive" / fascist / generally collectivist countries performed over the last 100 years in relation to the US? Who has flourished? Who has perished? If you are in doubt, take a drive through a typical Pyongyang or Naypyidaw suburb and compare it to a typical US suburb. Also consider Moscow and Havana; they love collectivist thought almost as much as the US academy. Earth to Mr. Krugman: human beings are more than widgets in your economic toolbox. [No, not a Republican.]Reply 26 RecommendTim Kane Mesa, Arizona Jan. 6
If 'everyday' people had guaranteed healthcare, education for their kids and food on the table, they would not be so overwhelmed with making and saving money. Whatever tax rate that requires on whomever could pay would be worth itReply 26 RecommendMichael London UK Jan. 7
According to the late Nobel Laureate & Econ Historian Douglas C. North's "Structure & Change in Economic History" @ the time of the collapse of the Roman Empire wealth was so concentrated that 6 senators owned half of North Africa, specie so concentrated that trade was reduced to barter & the commercial economy collapsed. Serfdom was created to tie workers to the land. The Roman legion still held a tactical advantage over their adversaries, but it had thinned, as a result the empire needed a bigger army however the wealthy & powerful used their influence to avoid paying taxes; as a result the empire lacked the funds & the political will to defend its borders @ a time when it controlled all the resources of Western Civilization @ a time when that included Turkey, Syria, Egypt & North Africa as well as the best part of Europe against barbarians. Similar events lead to the collapse of Ancient Egypt's New Kingdom, Byzantium, Mideavel Japan, Hapsburg Spain, Bourbon France, Romanov Russia, Coolege-Hoover America (triggering the Great Depression, Hitler, WWII, the Holoust), oh, & BushJr America. Concentrated wealth destroys great empires, civilizations & nations. Marx got in trouble for pointing out that industrial capitalism grows slower than the rate of wealth concentration. The right likes to shoot the messenger. He was doing them a favor. High taxes & redistribution of bargaining power is needed to stave off instability & collapse & hardship so vast you can't conceive it.26 RecommendMike NY Jan. 5
Really fascinating article and very informative. More please. What's the lowest rate in the US? When I started work in 1981 in the U.K. I paid 30%. Now down to 20%. Plus about 3% for national insurance which is income tax really but is meant to be hypothecated to the NHS. I'm happy to pay some more to ensure the continued cohesion of our society. I don't know why some people find that such a problem.Reply 26 RecommendNextGeneration Portland Jan. 6
This ignores the fact that most people with a lot of money don't make their income in the form of a paycheck. What we really need to do is return the tax rate on investment income, not earned income. That would also help end these wild swings and speculation we see on Wall Street.Reply 26 RecommendJS Seattle Jan. 7
Appreciate the reporting, but NYT why not report on what Nancy Pelosi is saying or doing vs. a freshman in Congress? The Speaker of the House has years and years of experience; is one of the few members of the government who has been recorded effectively talking "back" to Trump; and as her daughter says, is someone who clearly knows what she is doing, so people (in America) can sleep at night.Reply 26 RecommendPaul Wortman Providence Jan. 5
@Jason, you wouldn't move to CA or Ireland, you'd move to countries like Saudi Arabia, Bahrain, Kuwait, or Macedonia. Go ahead, be my guest!26 RecommendGary Durst Boston Jan. 6
It's been clear since Ronald Reagan that tax cuts don't trickle down while workers wages stagnate. It's time to reverse course, especially when Trump has nearly bankrupted the Treasury and Republicans have been shown to be hypocrites on deficit reduction. It's time to address income inequality and provide funds for Medicare-for-All; an infrastructure program that will bring the nation into the 21st century with high-speed rail and a modern energy grid that includes solar and wind; and prods states to return to tuition-free higher education at state colleges and universities. A.O.C. is "right on the money" with a top bracket of 70 percent. It's time to end the Trump kleptocracy and fully restore the graduated income tax.Reply 25 RecommendMax Dither Ilium, NY Jan. 7
Fascinating...an oversimplified correlation of two variables (tax rates and growth) to justify redistribution of wealth. "Hey, Mr/Ms X, I know you earned your income based on the value of what you do in a competitive marketplace, but you don't really need all of what you earned...so we the government, arbiters of wise decisions about how to spend money, are going to take most of what you earned and give it to someone else." Poppycock.... Rep Ocasio-Cortez seems both nice and sincere; I'd venture to say she's a very good person based upon her concern and empathy, and I don't understand the flawed tactics of the right in picking on her extra-legislative habits (dancing, clothing choices, etc.) Her empathy and personality don't balance her terrible politics regarding redistribution of wealth. As for economists -- Nobel Prizes notwithstanding -- the good ones are driving gorwth today and not publishing opinion pieces based on poor economic theoryReply 25 Recommendmrfreeze6 Seattle, WA Jan. 5
The point AOC (and, surprisingly, you) miss is that the kinds of wealthy people she wants to target with a 70 percent marginal tax rate don't make their income from wages. They make it from capital gains instead. So, if she wants to create a more sustainable revenue flow to the government, she needs to work on getting those rates up to reasonable levels. But capital gains have different forms. The part that she needs to focus is on speculative capital gains, not investment gains. Short term gains resulting from just flipping securities is gambling writ large, and there's no reason why the taxpayers should have to subsidize that risk-taking with low tax rates for the flippers. Treating these gains as ordinary income is goodness, but only if that rate matches the higher rate AOC wants. In fact, those should be higher than the top marginal rate, and expenses related to them should not be deductible. (This should include carried interest, too.) Long term capital gains tend to create jobs, infrastructure, and retirement savings, so those need to be encouraged with deductions of related expenses, and lower tax rates, too. In any event, I encourage AOC in her thinking. We need to readjust our tax system to make it more fair to the taxpayers, and to stop the robber barons on Wall Street from ripping us off.Reply 25 RecommendA Populist Wisconsin Jan. 5
@Prof Forgive me for not feeling sorry for the wealthy. They have benefited greatly under the system of government we call the U.S., a system we all pay for. There are plenty of other taxes people pay besides federal taxes (excise, state, city, local, property, etc.). They don't have armies of lobbyists, attorneys and loopholes to protect their capital. As for moving all of their money offshore, good riddance.25 RecommendART Boston Jan. 6
@hammond Paul Krugman has written about the "Europe was Rubble" myth - the idea that the unprecedented creation of a large and prosperous U.S. middle class, was only possible because of those special conditions. https://krugman.blogs.nytimes.com/2012/11/19/the-europe-in-rubble-excuse / Here it is about tax policy, but it is also brought up as an excuse not to try policy responses to high unemployment, low wages, etc. In addition to PK's arguments: First, the whole idea that we had faster growth due to having had trade *surpluses*, doesn't make sense. Those surpluses actually required *more* output - not less. So, in theory, if Europe had *not* been rubble (dubious, as PK points out), US growth should have been *higher*. OK, that is all based on theoretical supply side constraints. But what about Demand? OK, now you have something. The trade surpluses increased demand (AD = C+I+G+(X-M). It is long past time to start talking about aggregate demand, and how that has been creating a dysfunctional economy. Also, how destruction of the New Deal, has allowed wages to stagnate, which has given us lots of low productivity jobs at low pay, reducing productivity growth through compositional effects - but more importantly, making US poorer, less efficient, and with less job satisfaction. Workers can tell when their job is really not valued. Finally, if indeed making low skilled US workers compete with foreign starvation wages is a problem, we need to acknowledge and fix that.25 RecommendCitizen RI Jan. 5
One of the biggest myths out there is the one in which an individual says "I did it all on my own". The truth is, no you did not. You had an education, passed down from other generations that made discoveries, you had paved roads, police and fireman, an educated workforce, safe food to eat, clean water to drink. All things paid for by everyone. We should have high taxes that are progressive. People use the misnomer, "The Government" to try and discredit as others the people charging the taxes. But come on people, stop being stupid. Our constitution says "Government by the people for the people". We are our government. Anyone of you, or I, can run for office. Enough of this fake individualism conservative fairy tale. We need to work together in order to build a more just and perfect society.25 RecommendRational not Rationalize Milwaukee, WI Jan. 7
You can put all the charts and graphs you want in front of people, provide all the historical evidence available, and provide evidence of how things have never and are not now working the way Republicans say it has or will, and they still will refuse to believe their lying eyes. The Republican experiment to fleece the middle and lower classes is ongoing and successful, in part supported by the middle and lower classes' willful blind ignorance and devotion to self flagellation.Reply 25 RecommendKenneth Johnson Pennsylvania Jan. 5
Please don't forget we are talking about the highest MARGINAL tax rate, e. g., the tax due on the income over $600,000 for a couple filing jointly was 37% in 2018 and the same couple paid 35% on $400,001 to $600,00, and 32% on $315,000 to $400,000, and 24% on $165,001 to Ą315,000, and 22% on $77,401 $165,000, and 12% on $19,051 to $77,400, and 10% on income up to $19,050. What we need are more margins on the high end; to equate a $600,000 earner with a $10,000,000 earner is absurd. Nearly half the top %1 of earners make $10,000,000 or more! Why should they be taxed at the same rate as someone making 6% as much??? A family making $36,000 (6% of $600,000) pays a highest marginal rate of 12%, while the family making $600,001 pays a highest marginal rate of 37% and a family making $10,000,000 pays at the same highest marginal rate of 37%! The incentive for the top .1% in this set up is not to put money back into their businesses or employ more people, but rather, it's to buy off politicians dedicated to keeping their tax rate on the bulk of their income ridiculously low! When the Koch brothers thanked Paul Ryan for passing Trump's tax cuts it cost them $500,000 (in donations to Ryan), but gained them $1,000,000,000 to $1,400,000,000 in reduced taxes. See how it works? Forget about the 1%! Go after the .1%!!!Reply 25 RecommendYW New York, NY Jan. 6
As an affluent retired person, I left New Jersey for Texas, where I'm originally from. With 'an optimal tax rate of 73%', I'll be leaving the USA. I can still spend 182 days a year here. Let them tax those affluent people who must remain behind. As Margaret Thatcher said: 'The problem with socialism is you eventually run out of other people's money'. Or am I missing something here?25 RecommendMarvant Duhon Bloomington Indiana Jan. 5
Love the fact that the article is punctuated by a slick advertisement pushing sales of $13 million co-ops. Does Krugman think that high-earning W-2 taxpayers will continue living in New York City, or even the US, when rates are 70-80%? France tried this just a few years ago; it was an instant failure resulting in a quick exodus of the country's largest taxpayers. Krugman is living in the fifties. We are now a globalized economy where capital and human resources are far more mobile.24 RecommendBBB Australia Jan. 7
I will quibble with one small and tangential claim in this article. Krugman writes that additional taxes on the very rich will not affect their life satisfaction, since they can still buy what they want. This is not always the case. Many of the very wealthy want to buy more things than they can afford. And some, not just the Koch family, want to buy the government. They pour billions into the attempt. And as it happens, that's another reason for increasing the marginal tax rate on the very rich.Reply 24 RecommendLisa NC Jan. 6
Why not tax labor lower than capital gains? Labor will have more incentive to work because they can keep more of what they earn. People who live off capital will just keep doing what they are doing. I doubt they'll rush out to get W-2 jobs. We're tried the reverse for long enough, let's flip it around and give the majority their turn.Reply 24 Recommendjoyce santa fe Jan. 5
As a recent retiree, I was surprised to learn that my husband and I wouldn't be paying any taxes on our substantial capital gains, dividends, and interest, as long as we kept below the ~ 77,000 income level. We're living on current cash and taxable accounts, and are fortunate not to need to sign up for SS until 70 1/2 nor pull from our retirement accounts (except to fill up the bracket). This is basically ridiculous. We're affluent, not Uber-wealthy, but certainly can afford to pay more than the piddling amount that we've paid the last couple of years.24 Recommendmt Portland OR Jan. 6
A country where taxes are basically fair and social programs give people, all of them, basic security, is a calm and efficiently working society that does not have regular massacres in schools and churches, and does not have a restless and frustrated public. and so on. there is a country like this next door. The contrast with the disfunctional US today is striking.Reply 24 Recommendttrumbo Fayetteville, Ark. Jan. 5
@Barking Doggerel Excellent comment. A keeper.24 RecommendSocrates Downtown Verona. NJ Jan. 6
Equality. That is a necessary component of civilized society and democracy. You have to have a certain level of equality. Freedom to become a billionaire is not good for America or any country. Community, compassion, belonging, love, equality. Not selfish riches.24 RecommendThomas Zaslavsky Binghamton, N.Y. Jan. 5
@Jay For the full context, the 1999 Gramm–Leach–Bliley Act was authored by three Randian Republicans from Republican-majority Senate and House. While Bill Clinton should not have signed it, Republicans authored it. In April 2003 - under the Bush Reign of Error - the attorneys general of two states went to Washington with a stern warning for the nation's top bank regulator. In the Office of the Comptroller of the Currency in Wash DC, the AGs from North Carolina and Iowa said lenders were pushing increasingly risky mortgages. Their host, John Hawke, expressed skepticism. Roy Cooper of North Carolina and Tom Miller of Iowa headed a committee of state officials concerned about new forms of "predatory" lending. They urged Hawke to give states more latitude to limit exorbitant interest rates and fine-print fees. "People out there are struggling with oppressive loans," Cooper recalls saying. Hawke, a veteran banking industry lawyer appointed to head the OCC by Bill Clinton in 1998, wouldn't budge. He said he would reinforce federal policies that hindered states from reining in lenders. The AGs left the tense hour-long meeting realizing that Bush-Cheney's Washington had become a foe in the fight against reckless real estate finance. The OCC "took 50 sheriffs off the job during the time the mortgage lending industry was becoming the Wild West," Cooper says. http://www.nbcnews.com/id/27121535/ns/business-us_business/t/states-warned-about-impending-mortgage-crisis /24 RecommendDeb Blue Ridge Mtns. Jan. 6
@Red Sox, '04, '07, '13, '18, The rich never work for the poor. The relatively poor work for the rich, after which the rich complain that they are being asked to pay taxes for services for the people they underpay.24 Recommendalan san francisco, ca Jan. 5
@vulcanalex - Did it ever occur to you that if Charles and David Koch, together worth upwards of 90 BILLION, paid taxes proportionally the same as you do now, your taxes might be lower? The middle class has been footing the bill for 50 yrs. and needs actual relief. No one, no one, no one needs 90 Billion $$. That's pure greed and it's economically stupid as well.23 RecommendJohn McCoy Washington, DC Jan. 7
One should tax every source of income at the same rates. Thus, incomve from dividends, capital gains, and inheritances should all be taxed at the higher rates. The distinction between earned and passive income is false and makes no difference to the recipient.23 RecommendJack Irvine, CA Jan. 5
@Gwe A true win-win. Pay the CEO's excessively to satisfy their egos and tax them appropriately to foster equality.23 RecommendSusan Fitzwater Ambler, PA Jan. 6
The Tax Cuts and Jobs Act of 2017 took away: SALT deductions (limited $10,000 fout of $19,883)) Personal exemptions ($12,150) Unreimbursed business expenses ($9,906). This increased my TAXABLE INCOME by + $32,209. Sure, marginal rate dropped from 24% to 22%, but my Federal tax INCREASE this year was $7,085 or 71%. MAGA!23 RecommendErik Nordheim Seattle Jan. 6
Some scattered thoughts. Bear with me. I just got back from an Orthodox Jewish wedding (a lovely experience!). While there, I fell into conversation with a good friend--a conservative. A moderate conservative--but conservative nonetheless. A dichotomy struck me--which I kept to myself. My friend's view of "classical liberalism" was "limited government." Enable people to rise as far as their talents and determination take them. And get out of the way. Such (he declared) was the philosophy of our sixteenth President--the sainted Lincoln. The Civil War (he said) garnished him with a bright shining halo he might never have achieved otherwise. Okay--maybe so. Maybe not. Who knows? So what's my own philosophy? Which I never got around to articulating. Protection, Mr. Krugman. Protection. Protection of an oppressed minority from an oppressive majority. OR-- --of an oppressed majority from an oppressive minority. Protection of the weak from the strong. Of the poor from the rich. Of the honorably striving working people that never won a place in the heart--or the books--of that conservative icon, Ayn Rand. So, Mr. Krugman-- --I read your piece with considerable sympathy. Tax the rich? Sounds good to me. Even out the horrendous inequality now plaguing and poisoning American life. But part of this feeling, Mr. Krugman, is old-fashioned SPITE. Sorry! I'd love to hear the Koch brothers howl. Someday. Soon.Reply 23 Recommendjames jordan Falls church, Va Jan. 5
@Gwe AOC's 70% tax rate proposal applies to dollars earns $10,000,001 and above. E.g. 70˘ on that one dollar instead of today's 37˘.23 RecommendSN Los Angeles Jan. 7
AOC has her work cut out for her. She will need your help. In reality, she will need all the support she can get to persuade the Democratic Caucus that a tax rate of 70-80 percent on very high incomes makes sense. Clearly, she and many noted highly respected economists have found that the trend in inequality has not been beneficial to the performance of the larger U.S. economy. She appears to have the energy and intelligence to develop a narrative that the Caucus could use but ultimately she and the proponents of the 70-80% will not hurt their chances for re-election in 2020. Equally important in making our society more egalitarian are the issue of tax shelters and the definition of income in the tax code, e.g. the treatment of income from capital gains vs. income from salaries and wages. My very rich friends seem to load a large portion of the "winnings" in offshore shelters. A big difference that needs to be addressed is the "cap" on payroll tax rates that are clearly unfair to the average wage-earning employee, and the self-employed "gig" economy worker. I hope someone will take up this very unfair provision. I suggest that requiring ALL income be treated equally with NO CAP for the FICA-HI payroll deduction would make the Social Security Trust Fund flush and possibly the funds required for Medicare for All a reality. With this kind of payroll tax package, there is a possibility that the payroll tax rate could be reduced or payments to recipients increased.23 RecommendJulie Carter Maine Jan. 7
@Joe, it appears you're confusing the marginal tax rate (the rate at which your highest additional dollar of income is taxed) with the overall rate at which your income is taxed. They're not the same. People won't be paying the highest rates except on their highest additional dollars of income -- those last several million dollars, for example.23 RecommendBewley5 Austin Jan. 7
What needs to be pointed out in every article on tax rates is that the 70% or 35% or whatever rate is in force is not on ones entire income, but only on the topmost part. It might only be on the top 10% of an individuals income, not on the entire amount. That is where people who oppose these rates don't get it. And when the "alternative minimum tax" was passed, it was meant to make sure everyone paid some tax because they weren't allowed to use all of they deductions. But somehow, some are more privileged than others and get to pay nothing, like the Trumps and Kushner's. In the meantime, some of us retirees who saved like crazy for retirement and had some decent investments have to pay through the nose every year when the law requires us to sell a certain portion of our retirement funds and pay capital gains rates. We have paid alternative minimum tax for years with far less annual income per year than Ivanka has per month.23 RecommendRoscoe Fort Myers, FL Jan. 7
The decline of the American middle class started with the election of Reagan and his voodoo economics. The investments we made say in college education could no longer be sustained at the lower tax rate and the result? No one but the upper ten percent can afford college.23 RecommendJeremy Kaplan Brooklyn Jan. 7
The other intended consequence of low taxes for the rich has been the accumulation of money that can be used to buy political power. I think that's the real purpose of the right, to have the power to take over our country. To counter that we need to look at wealth taxes and taxing more capital gains. We don't need more Donald Trumps and Koch brothers.23 RecommendEllen San Diego Jan. 5
@Billy Walker Just because 70% sounds "insane" to you does not mean it isn't the best policy. Are you an economist?23 RecommendBBB Australia Jan. 6
Bravo to Ocasio-Cortez, and to Krugman. But what I'd like to know is why is it that such sensible and fair taxing policies have not been promoted by current Democratic members of Congress? To answer my own question - they've been "bought" by corporate/1% campaign contributions. This said, how will Ms. Ocasio-Cortez fare in the House? Conversely, how will the House fare with her in it? Should be interesting to watch.Reply 23 RecommendBill B Fulton, MD Jan. 7
We need a "Jobs Created" form in the 1040 stack. In exchange for the tax cut, the very wealthy should be required to file it for the same reason that the very poor are required to prove they qualify for the Earned Income Credit. How many jobs did you create? How much were they worth? Write it down. Some ridiculously rich American volunteer should step forward with the last 10 years of their tax returns and corespondingly matched annual budgets to confirm 2 things that the GOP refuses to admit but uses to underpin tax cuts for people who do not need one: 1-The Uber Wealthy aren't big job creators. 2-The impact they have on the economy is far less than the average person who spends all their tax cut on goods and services. A higher tax rate, better matched with uber high personal income generated by the global multiplier effect, will have a greater impact on the economy in one year that one person can achieve in a lifetime. Kill the Trickle Down Theory before the GOP recycles it again.22 RecommendSandraH. California Jan. 6
@romanette I suspect that for every Jason who actually makes enough to pay the 73% marginal rate there are 50 Jason's that don't.22 RecommendVizitei Missouri Jan. 6
@Geoffrey, you're mythologizing wealth. Most annual income over $10 million has nothing to do with being "super productive." That's only true in an Ayn Rand novel.22 RecommendChris Toronto Jan. 7
I am fully aligned with Mr. Krugman when he bashes the idiocy of Trump's economic "policies". I part ways with him over his advocacy of super high tax rates. He makes a case that we did so well when we had it but he, of all people, knows the difference between correlation and causation. In the years without internet and with international movement by people and companies was full of friction, this kind of extortion and "not caring" about what the "rich" thought held up. In today's world, you would massive exodus of the most productive and economically active members of our society. It failed. In Europe and in the US, countries had to contend with real competition from other geographies who were only too happy to welcome these folks. Another point, which Mr. Krugman fails to address is this: who will put the capital in question to a more productive use - the government which collected it as a tax or the businessman who has an opportunity to invest in the improvement he finds most efficient and effective? This does argue for policies that encourage the 'right choice", but overall, the answer is known. This is why every true socialist system has failed economically, and will continue to do so. 70% tax bracket is not the answer. It never was.Reply 22 Recommendlinearspace Italy Jan. 7
Many of the comments here are dismaying. The point here is that both the US economy and society are not sustainable in the long-term with a tax system that creates massive inequality, public debt and disproportionately supports the enrichment of the already-wealthy. There is a self-centred, growing (mostly Republican) billionaires club buying the political system, defining public policy and not surprisingly they are the primary beneficiaries. US democracy is very broken and the rest of the world no longer views it as the example it once was. The US needs more voices like OAC's.Reply 22 Recommendpendragn52 South Florida Jan. 7
I thought I already liked AOC a lot; now I like her even more, especially after her political platform about a free universal health care reform proper of one of the major powers in the world.22 RecommendJacob Sommer Medford, MA Jan. 6
@Jason "apply some creativity and critical thinking (you know - the kind that happens in the private sector)." Worked in the private sector for 30 years. Never saw much of that.22 RecommendKurt Chicago Jan. 7
So often, it seems like the Republicn tax plan is, "We need to lower taxes on the rich because eventually it will be good for the middle class! Pay no attention to that sliver of middle class tax hike behind the curtain..." Why anybody takes their economic rhetoric seriously when there are no credible cases that their plans have worked lo these past 40 years remains a mystery to me.22 RecommendD I Francis London Jan. 7
The real crime is how much of the pie so few take home in the first place and how little the great bulk of Americans see. If there were a small village, and one powerful man making the rules on wealth distribution decided to give himself a ninety percent cut of the wealth and leave the remaining ten percent to the rest of the townsfolk, they'd go after him with torches and pitchforks. But we have a giant complicated impersonal economy, and this simple economic injustice gets lost and confused in the mix. But the fact remains, the people with power - the stewards of our government and our economy - are abusing their power, and we as individuals, and all of us as a society suffer greatly.22 Recommendmarkymark Lafayette, CA Jan. 5
@Joe Hi, It would be progressive and banded, so you would only pay 70% on the very highest part of your earnings. So you would be paying 30% on earnings up to say 100K, then 40% on earnings between 100K and 250K, and so on. Hope this helps.22 RecommendQuinn New Providence, NJ Jan. 5
If this country ever aspires to greatness again, it will take campaign finance reform and the end to vulture capitalism, including raising tax rates on wealthy individuals and corporations. The supreme court has given corporations way too much power and it's past time to take it back.22 RecommendMary M Raleigh Jan. 6
@Brinton I agree - a fair tax system would look at all income equally. A dollar of income would be treated the same regardless of its source. The discount on capital gains makes no economic sense - this is "picking winners and losers", something the GOP hates. Think of this: why is interest income taken at a higher rate than capital gains? The wrong answer is that the capital gain came from taking a higher risk. Why does the tax law reward risk taking and by contrast punish safer investing with a higher tax rate?22 Recommenddcf nyc Jan. 5
Thomas Picketty studied centuries of income inequality and found that without progressive government intervention, wealth disparities tend to worsen. The single most effective way to shrink wealth disparities and grow the middle class is through progressive taxation, aka, soak the rich. This is how Denmark does it. Funny thing, growing the middle class increases national happiness and strengthens a sense of community. Big difference from the uber rich who buy islands just to live without neighbors. Living in a more equitable society makes everyone happier.22 Recommend617to416 Ontario via Massachusetts Jan. 6
@Tom Dr. K is all in on the taxing of wealth and cap gains at higher rates, and while I haven't read AOC's particular proposals yet, no doubt she would agree.21 RecommendM. Ng New York, NY Jan. 7
@Annie I'm not sure a small local community group would effectively or efficiently provide some of the things we rely on the government to provide -- healthcare coverage for instance (at least here in Canada) or a police force. Those skeptical of what government does should try living in a country without musth government: Somalia, maybe.21 RecommendAna Luisa Belgium Jan. 5
We only need to look as far back as Kansas in 2012 to see a real life case study of republican tax policy in all its theoretical glory. Governor Brownback and the republican legislature passed into law a low individual income tax rate and eliminated state income taxes entirely for pass-through entities (ie small businesses) to spur job creation and investment in businesses. Not only did it not create said jobs nor spur investment in businesses, the state collected $750mm less in income tax ($2.2b vs. $2.9b) over 2014-16 and the state began FY 2017 with a $350mm deficit. Sadly the people who suffered disproportionately were residents of small towns and districts whose districts didn't have strong enough balance sheets to weather unusually low levels of tax revenue, where public services such as safety and schools struggled (many of which had to consider closing or consolidating). In addition, the state diverted funds from infrastructure spending and universities to the general fund and spend down the state's cash reserves. That is the result of a republican tax plan enacted.Reply 21 RecommendJenna X. Gadflye Atlanta, GA Jan. 6
@bcw And the exact same also goes for Trump himself, of course. Compare that to what Obama and the Democrats did: they increased taxes for people like themselves multiple times, and then used that money to cover 20 million more Americans all while curbing federal healthcare cost increases, AND by doing so saving an additional half a million American lives a decade. THAT is "putting America first", outside of the GOP "alternative facts" world.21 RecommendCO fan Boulder Jan. 6
Another reason to tax the 1% at the highest rate possible: they would have considerably less money to spend on buying politicians who will rig the system to benefit the wealthy at the expense of everyone else. I'm sure NYT's conservative commenters will say "but...job creators!" Right. "Job creators" who are rapidly automating the means of production because robots don't need to be paid a living wage. They never get sick or need vacations, either. Robots can work 24/7 without lunch or or bathroom breaks, too. Unlike us pesky peasants with our quaint notions about Constitutional and civil rights, including "life, liberty and the pursuit of happiness." The misanthropic rich deserve a good soaking, every now and then, to remind them that they're no better than us and just as human as we are.Reply 21 RecommendJ San Diego Jan. 6
What Paul Krugman does not say (but knows all too well) is that due to various deductions and tax shelters, the effective (as opposed to nominal) % of income paid in the 50's, 60's and 70's was not much more than now. For example, until 1986 taxpayers were allowed to exclude 1/2 of their capital gains. So, if you were in a 70% tax bracket, the capital gains tax was 35%, in the 50% bracket you paid 25% and so on. Krugman knows this, but obviously does not mention it. He has to do his part to bamboozle the rubes. Remember, this is the same guy who predicted on election night 2016, that the stock market would "never recover".21 RecommendMV CC Jan. 5
AOC should run for president in 2028, the first year she is eligible. She's smart and super-attractive, which will turn R's into even crazier people than they are now, because people will always vote for someone who looks great. Would've worked for Beto in Texas if not for the massive voter suppression they have there.Reply 21 RecommendAndrew Connecticut Jan. 7
What we have going on right now here in the US is representation WITHOUT taxation.Reply 21 RecommendDave Westwood Jan. 6
@Billy Walker - "What policy on Planet Earth could possibly justify the government becoming an equal partner, or better, with someone's earnings?" Because there isn't a single person on the planet that works hard enough to "earn" $10 million per year, let alone those who actually have that as an income. There's comes a point at which a person's "earnings" are nothing more than benefits of position - which in and of itself isn't a problem. But it's important to acknowledge that this extra income is earned solely because of the individuals below them, as well as the advantages the state/government has provided to allow those earnings (typically through infrastructure, policies, protections, other indirect features, etc.), becoming an equal partner in redistributing that extra income to those that actually worked to make it happen, or paid for the ability to earn it, is reasonable.21 RecommendJohn Miami, FL Jan. 7
@Jose "aren't rich people part of our democracy? Don't they get a say as to whether they have to work and give away their earnings?" They do ... they get one vote person just like everyone else. They do not get one vote per dollar of income, although some of them act as if they should.21 RecommendSteve California Jan. 5
@Billy Walker "As someone who earns well less than $100k a year I simply cannot believe this nonsense of 70 or 80% tax rates. Just because I am not smart enough to earn $5 or $10 million or more a year does not give the government the right to take most of it. This tax concept is pure insanity. Even if it applies to earnings that only exceed the $10 mil number. Insane." You start out with the wrong premise right out of the gate. Many in the top 1-2% have done nothing especially noteworthy to achieve their wealth. They neither earned nor were particularly inventive. Some like Elon Musk definitely earned it. Others like the presidents children just inherited the fruits of a lifetime of cons and scams against ordinary working Americans. In either case there is a such a thing as an inflection point beyond which amassing further wealth means nothing. I see nothing wrong with taxing wealth beyond that critical maximum at those higher rates. After all many of those people enjoy the fruits and stability of a society made possible by the collective sacrifices of generations of Americans in wars past, present, and future. Much of the infrastructure (bridges, highways, waterways, court systems, property rights etc) that exists today (such as it is) that makes the current economic engine possible was bought and paid for by the millions upon millions of ordinary working Americans. The rich should pay more because they benefit the most from this sacrifices others have made!21 Recommendm.waterbury Seattle Washington Jan. 5
@George No one is suggesting people who make $200k pay 70% tax, these are rates for those making $10 million or more.21 RecommendRobert Out West Jan. 6
@Georgia M If you believe that the obscenely high and ever-rising incomes of the extremely rich are "their property" and that their rigging of our economy, our taxation rules, and our political process played no role in their good fortune, you have not been paying attention. A "young brilliant doctor" isn't even remotely in the class of the ultra-rich and is exactly the kind of misleading example they love to point at, like "small businessmen." We are talking billionaires and close to it.21 RecommendRich Berkeley CA Jan. 5
I can see why the righties are angry, and demanding that the corporate and the wealthy pay less. After all, worked great in Kansas.Reply 21 Recommendbcw Yorktown Jan. 5
@Peter, that's a marginal tax rate, not the rate on all your income. Only income above, say, $1M per year would be taxed that high. I assume most people can survive quite well on $1M per year, plus 30% of amounts above that.21 RecommendDavid St Louis Jan. 6
The rich have figured out how to maximize their returns on investment - the most productive dollars the rich spend is to buy Republican (and some Democratic) politicians. The Koch brothers invested a mere few hundred million to buy some elections and have so far made about 1.4 billion dollars from the Republican tax cut, a return of a few hundred percent in one year; which will continue every year going forward.21 RecommendABC123 USA Jan. 5
Hey, Prof Paul. I think we as a body politic need a refresher on what a marginal tax rate is? A 70% top marginal tax rate does not mean that the people 'earning' a million only take home 300K. It just means that after some other threshold has been crossed in terms of income after deductions, income above that level is taxed at increasingly higher levels. So that, say, the first 100k is taxed at a certain level (n), but the last 100k is taxed at a level that equals 'n minus 100K' and minus the other increments in income that kick in the higher marginal rates on the scale? Not elegantly stated, I know, but I find, over and over again, that people seem to not have been taught the difference between a tax rate and marginal tax rate.Reply 20 RecommendSusan Cambridge Jan. 7
From the article: "AOC's advocacy of a tax rate of 70-80 percent on very high incomes." This shows her naivete as a young person with limited years of working for a paycheck. At a certain point, if I'm only going to keep 20-30-cents of each additional dollar I'm making no thanks time to pack up for the day, go home, relax and enjoy time with my family. I think at least 95% of people would say the same thing. It's just not worth it especially to be paying for people who are staying home and people who are staying home and pumping out more and more babies, while I responsibly only brought two children into the world and pay for them myself.20 RecommendKevin Shoemaker Seattle, WA Jan. 7
The Swiss have a wealth tax. People are taxed approximately 1% for money lying around in bank accounts and other assets. This means taxes aren't focused on income per se, but accumulated wealth. I think it's an interesting idea for taxing the super wealthy. The tax could be prorated, higher for those with more money and very low for those with just a little savings.20 RecommendGuy Sajer Boston, MA Jan. 5
What this incredibly focused and accurate opinion piece does not mention is the uses that marginal taxes were put to or the incentives people and companies had to lower their marginal taxes through reinvestment. Infrastructure was created, low cost higher public education was expanded, basic research in those institutions was greater, and entire new industries were created, employees were invested in. Now, we have the rich playing the W.S. casino, mostly controlled by bots, employees are commodities or apprenticed and indebted, wages are supressed, there is not a strong infrastucture plan, I could go on. I say Make America Great Again, and tax the rich.Reply 20 Recommendcdearman Santa Fe, NM Jan. 5
@wes evans - I don't think that that is actually true. Furthermore, I'm not sure that the folks who do that work and are in that tax bracket are working because of the money. Jeff Bezos? Bill Gates? Warren Buffett? (the list could be quite long). If you taxed them at a higher rate, they wouldn't quit. In addition, many of those folks are no longer actually working, but simply accruing wealth though investments. They won't suddenly uninvest because of higher taxes. Instead, we'd have better schools, better healthcare, better transportation for everyone, and the economy would benefit much more as a result.20 RecommendA. Stanton Dallas, TX Jan. 6
Obviously, the public is unaware that the tax rate during the Eisenhower Administration, for people making above $400,000, was 90%. So, the idea that a 75% rate on the 0.1% is excessive is laughable. People in the 0.1% have many legal ways to reduce their tax liability. As Warren Buffet had stated many time, he pays less taxes that his secretary and Buffet is one of the four richest people in the world. The tax rate for people in his income bracket is not more than 39%. He, obviously, does not pay taxes at that level. Go figure.20 RecommendWilliam LeGro Oregon Jan. 7
Ms. AOC comes off to me as a non-threatening American Congresswoman of Puerto-Rican descent. What is it about her that makes her appear so dangerous to Trump's crazed male supporters? I blame most of it on her bright red lipstick, which for some reason is always threatening to insecure men.20 RecommendWhite Buffalo SE PA Jan. 6
@Freda Pine Here's an early commenter who already detailed this out and should have gotten NYT Picked since a lot of readers needed to read it in order to help shake loose a stuck wrong notion about what marginal rate means: Rational not Rationalize Milwaukee, WI Please don't forget we are talking about the highest MARGINAL tax rate, e. g., the tax due on the income over $600,000 for a couple filing jointly was 37% in 2018 and the same couple paid 35% on $400,001 to $600,00, and 32% on $315,000 to $400,000, and 24% on $165,001 to $315,000, and 22% on $77,401 $165,000, and 12% on $19,051 to $77,400, and 10% on income up to $19,050. What we need are more margins on the high end; to equate a $600,000 earner with a $10,000,000 earner is absurd. Nearly half the top %1 of earners make over $10M. Why should they be taxed at the same rate as someone making 6% as much? A family making $36,000 (6% of $600,000) pays a highest marginal rate of 12%, while the family making $600,001 pays a highest marginal rate of 37% and a family making $10M pays at the same highest marginal rate of 37%! The incentive for the top .1% in this set up is not to put money back into their businesses or employ more people, but rather, it's to buy off politicians dedicated to keeping their tax rate on the bulk of their income ridiculously low! When the Koch brothers thanked Paul Ryan for passing Trump's tax cuts it cost them $500,000 (in donations to Ryan), but gained them $1 - $1.4 Billion in reduced taxes.20 RecommendTony B NY, NY Jan. 6
@Red Sox, '04, '07, '13, '18, How many uber rich like Romney or wealthy CEOs or golf club developers actually worked for poor people? Gee, that's a tough one. Let me make it easy for you. Try zero. I am not wealthy and yet I never worked for a poor person in my life either, because a poor person would not have had sufficient money to pay even my meager earnings. When you work and pay taxes, you are not working for the poor, you are working taxes to support this country, and the many things it does for you. Remind me again how many of Romney's many sons enlisted. Another toughie. Again, let me make it easy for you. The answer is zero. Oh, that's right. Their "service to their country" consisted of helping Romney get elected. Kind of like Trump's sons service to their country. Or Trump's purple heart.20 RecommendNed Roberts Truckee Jan. 6
We're allowed to call people articulate?!? I thought that was a hate crime.Reply 20 RecommendMichael Rochester, NY Jan. 5
@talesofgenji Americans abroad are still required to file US tax statements. Of course, if they want to get rid of their US citizenship, they can. My guess is there is a way to capture that tax revenue. Perhaps starting with reminding the rich that they live in a society, and their wealth is tied to the health of the society.20 RecommendGaff New York Jan. 6
Paul, One of your best analyzes ever, and, your timing is impeccable. Thank you.Reply 20 RecommendDaycd San diego Jan. 7
Why are so many dead set against paying taxes? To use an old cliche "there is no such thing as a free lunch". This is how government services are paid for. Where would we be without government services? Are you willing to do without police, firemen, road crews, sanitation, the armed forces, aviation regulators, stop signs, parks and countless other things that government provides. Tax rates need to take into account income. The poor and the middle class should be taxed at a much lower rate than the wealthy. The wealthy can afford to have more taken in taxes. Do you really think they would notice? Greed is not an exemption. We should all be proud to pay our fair share of taxes. We live in a great country. Taxes are the levy we pay to keep it great.20 RecommendJosh Los Angeles Jan. 5
@Gwe the proposed 70% tax rate only kicks in after the executives are already earning 180X more than the average earner. Note that no other country comes closes to those inflated incomes! So your argument that they'll not get quality CEO's for less is nonsensical. https://www.statista.com/statistics/424159/pay-gap-between-ceos-and-average-workers-in-world-by-country /20 RecommendWhite Buffalo SE PA Jan. 6
Hey Paul why don't we just tax everyone at 100% and then redistribute to everyone perfectly equally? That would minimize the effect of diminishing marginal utility!! Hey Paul when are you going to wake up? Stagflation happened your position has been losing the argument for 40 years now, I am surprised you aren't used to it by now. Free movement of capital, free movement of labor, free trade. And no redistribution, that is where we are heading.19 RecommendJeong Yeob Kim Los Angeles Jan. 5
@jrinsc Too right. Let's make American marginal income tax rates great again! Bring back Eisenhower Republican tax rates!19 RecommendEddie Lew NYC Jan. 6
When I first saw AOC's tax proposal as a headline (and not reading the article), I did think, "Wow, that's too high!" But after thinking through the issue with Krugman's help, I've come around and now agree with AOC. I do think it'll be a tough sell to a sceptical public (surely made worse by conservative lobbying), but if Democrats can tune the public with what prosperity was like in the '50 with progressive taxes in place, I think there's a good chance that a majority of Americans will back this vision. But the work had to start now and with urgency (and without the shutdown of our government!).Reply 19 Recommendtrue patriot earth Jan. 6
George Bernard Shaw: "The more I see of the moneyed class, the more I understand the guillotine. "19 RecommendJon Washington DC Jan. 6
1. end the carry exemption for VC money 2. see 1Reply 19 RecommendBascom Hill Bay Area Jan. 5
There's this popular myth that supposedly tons of conservatives went "hysterical" over a perfectly innocent video of Ocasio-Cortez dancing around with friends. How many people exactly were "hysterical"? I keep reading this, and as far as I can tell it's just a myth. Was there maybe one fool who posted the video in a misguided attempt to somehow embarrass her? I guess, probably. But please just face reality and recognize that beyond a few negligible cranks, nobody cares.Reply 19 RecommendMark Koerner wisconsin Jan. 6
Please make a list of productive Americans by job title. Or is your list by income level? Are public school teachers productive? If so, why have their incomes been nearly flat for decades? Why has the median income of Americans not kept pace with inflation for over 25 years? They haven't been productive? They have been. Big Business hasn't shared those gains in productivity via $wages. The IBT of those businesses has soared.19 RecommendNelson Alexander New York Jan. 5
We hear a lot about "hard-earned" income and "hard-earned" dollars. Very well. It IS hard to earn money, at least for most people, so perhaps the government shouldn't tax income from wages, salaries and professional fees--and even from gambling--at such a high rate. Maybe we should change the system by pushing the top income tax rate downward and then raising the estate tax (often called the "inheritance tax"). That way, more "hard-earned" money will stay with the taxpayers who earned it, and the government would take a little more of the genuinely unearned money. An old saying about the people who were born on third base and thought they hit a triple comes to mindReply 19 RecommendR Biggs Boston Jan. 7
First, I believe Picketty also recommends similar highly progressive rates. Second, I'd be curious know what effect such rates would have on top-tier inflation? It seems clear that "inflation" is relatively low and stable because it no longer enters into wages. At the upper income level, meanwhile, inflation appears rampant. Everything in top-tier consumption, from art and high-end property to financial advice, bespoke suits, opera tickets, luxury hotels, political leverage, and legal fees, seems to be almost hyperinflating. This in turn drives the rivalrous demand for even more concentrated wealth at the top, a keep-up-with-the-Jones among billionaires . We might be doing the rich a favor by putting a tax chill on their metastasizing lifestyles.19 RecommendJack Nargundkar Germantown, Maryland Jan. 5
I assume that you work hard to make a living. Do you think that investment bankers and tech CEOs work 5000 times harder than you? I know a guy who wrote a computer program to trade stocks. He doesn't work at all, but makes more in a week than you make all year. Does that seem fair? The super-rich are able to buy influence, subjugate our democratic system, and push through laws that make them even richer - while making it harder for folks like you to get ahead. Does that seem fair? And you are worried about billionaires only bringing home $2 million / year?19 RecommendGeorgia M Canada Jan. 5
But this entire column presumes that the Republicans believe in science, data and facts. Despite 70+ years of evidence, knowledge and truth has not "trickled down" into the average Republican's mind. In fact, in the Trump era, it's gotten worse -- Republicans now believe in "alternative facts," which they make up to match whatever it is that they want to justify, and they assert that "truth isn't the truth." So good luck to OAC as she tries to convince Republicans about the efficacy of "a tax rate of 70-80 percent on very high incomes." Republicans, including the Trump administration, do believe that the 1950s was the best decade ever in the post-WWII era – not because of its 91% top tax rate on income, but for entirely different reasons that have nothing to do with fiscal policy.Reply 19 RecommendJoe Rockbottom califonria Jan. 7
I'm your average democratic socialist living north of your country and, yet I confess this article doesn't sit right with me. I enjoy reading Mr Krugman and I will read him first in your paper. What irks me though is his yup yup it's okay to soak the rich because it makes economic sense. Even if you could prove that taxing the rich at 75% won't harm economy, should you do it? That is to say, the wealth of the rich is their property. Just like my meagre possessions are my property. As a Canadian I pay around 29% income taxes (even working class Canadians pay a fair amount of tax). Wealthier Canadians pay around 55% of their income. We are fortunate that wealthy people feel invested in the community here and tolerate the higher taxes. The well-being of our public services is dependent on all people feeling they get something in return for their tax dollars. I guess what I am getting at is that there is a sort of social contract that all citizens are invested in-poor and rich. I recently spoke to a young brilliant doctor and asked if he wanted to move to the US (he has had some great offers). He said no, he wants to use his skills in the community. I am grateful this young man will work and contribute here. So, why increase his tax level even further? Saying that he has the money for the taking is not acceptable. I wish Ms Ocasio Cortez luck, but I hope these young socialists reign in the glee at the prospect of fleecing their fellow citizens.19 Recommend617to416 Ontario via Massachusetts Jan. 6
@Billy Walker they don't take "most of it." they only take that rate in the highest income percentile. So only the last marginal dollars earned. It is doubtful ANY CEO is worth the pay they get. and most of it is in stock options, the proceeds of which are not even discussed here because they are capital gains, not income. So, most CEO's only make a few hundred thousand in "income" and the rest is in stock options for which they are taxed at a much, much lower rate. That is how skewed our idiotic tax system is. They game it and don't even have to count their obvious income as actual income. Totally corrupt.19 RecommendTom Philadelphia Jan. 5
While there's no denying that many of the wealthy achieve success by their talent and hard work, no one becomes wealthy solely on his or her own. Chance always plays a role in anyone's success, and no one's success is achieved without extensive support from our society's institutions and from others. The success of any individual is therefore always a collective success -- created by a combination of the individual's own talents, the support of others, the advantages provided by our society, and the vagaries of chance. Because of this it is completely justified to expect -- and to demand if necessary -- that the wealthy give back some portion of their wealth to the community that contributes so much to their ability to become wealthy. Whether the share given back is 20%, 50%, or 80% should be determined based on two factors: first, how much does society need from the wealthy to continue to provide an environment in which as many as possible can succeed and, second, how important is it to maintain individually-held concentrations of wealth either to provide incentives for success or to allow for significant private expenditures and investment to complement our public expenditures and investment. While a 70% marginal tax rate on the wealthy sounds high given recent policy, the crumbling state of our public infrastructure, our fraying social safety net, and the growing inequities in access to the benefits of our society suggest a need for higher tax rates.19 RecommendJH NY Jan. 5
In 1960 when Eisenhower was president, the top marginal tax rate in the US was 93 percent, we were building interstate highways and quadrupling our higher education system via the GI bill, and the American economy was the envy of the world. So this notion that the country is better off if the rich don't pay taxes utterly ludicrous -- it is simply the invention of rich people who think they deserve to live tax-free. Since our democracy is broken and the rich basically own Congress, we will probably keep cutting taxes on rich people until they go negative, at which point American taxpayers will be paying the rich just for their overwhelming wonderfulness.19 RecommendGG New Windsor Jan. 7
As a small retail business owner I am continuously flabbergasted by chamber of commerce type's resistance to taxing the rich and increasing the minimum wage. My customers are NOT the 1% and every time wages have gone up my payroll has gone up 20% but my gross income has also increased by 20%. That is a good deal, and if my income taxes went up as a result of all my increased profit it would still be a good deal.19 RecommendBJ New York City Jan. 6
@Freda Pine here we go again. What do you not understand that this is likely a tax rate on those who make millions annually?19 Recommendbobg earth Jan. 5
Shouldn't we be talking about effective tax rates? Did people actually pay those high marginal rates? Given all the tax loopholes at the time, I don't think so.Reply 19 RecommendGrennan Green Bay Jan. 7
@Josh I have an even better idea--let's tax everyone at 0%! We'll all have lotsa money and we'll have a great big party. There are some downsides like not having an electricity grid, police, or firemen but on the other hand--whoopee!19 RecommendTom Kocis Austin Jan. 7
Good job making taxation policy interesting to read about. Maybe Dr. Krugman could clarify why and how the "taxes are bad" crowd insists on misrepresenting the marginal rate as the total rate, among other inaccuracies in a four-decade campaign to demonize taxation.19 RecommendProf San Diego Jan. 5
We need to assess the question of wether many of the rich "earn" money. You don't earn $200M in stock options and grants. What you have done is benefitted from a system that increasing rewards those with the power and the influence to rewrite the rules to their benefit and the the detriment of everyone else. How these people can take such a large portion of the corporate pie when lower paid employees barely get by is unconscionable.Reply 19 RecommendFromDublin Dublin, Ireland Jan. 6
Here are some facts Krugman will not mention. From 2014 At least 45% of Americans pay ZERO Federal income tax. The top 1 percent of taxpayers earned 20% of all Adjusted Gross Income. That same top 1% of taxpayers paid almost 40% of all federal income taxes. The top 1% of taxpayers accounted for more income taxes paid than the bottom 90% collected. One-fifth of the US population gets more back in refunds than they pay in Federal taxes. Keep doing the Robin Hood routine and the 1%' ers will move ALL of their money off shore.19 RecommendRG Bellevue, WA Jan. 6
@Barking Doggerel This last paragraph... so so true19 RecommendDisillusioned Colorado Jan. 5
@Ma Ah, yes - the wisdom of simplistic remarks. Unfortunately it takes actual information and insight to even begin to compete with an economist of Krugman's expertise. You seem to be confused about what profit is, or the theory used in optimization of profit (incremental spending). You absolutely want to spend up to the point where the next dollar brings in another dollar of profit but not beyond. Spending less leaves money (profit) on the table. Could it be that you don't understand calculus? I'm afraid that economics, and incremental tax rates are a bit more complex than that. Your dig about social conscience is duly noted, as is your missing the point of his analysis. None of this is based on social conscience, but in what generates maximum economic growth. Paul not only gives direct evidence of a reduction in the growth rate that correlates with the reduction of tax rates, he dissects the reasons why. Want is not a straight line curve, something that the 'greed is good' crowd has neglected for over 40 years. Of course, your only retort to evidence and thoughtful analysis by a Nobel laureate is to label his thesis 'lunacy'. Sorry, but without evidence, solid reasoning or even standing in the field no one is going to pay attention. Which is a good thing, it's time rationality regained the upper hand in public policy and politics.18 RecommendHBD NYC Jan. 7
@Prof Here are some facts you didn't mention. Many Americans aren't paid enough by the "job creators" to have enough tax liability. When you pay people low enough wages, they end up being below the standard deduction. The top 1% has significantly more *wealth* than their wages indicate. Our tax scheme is mildly progressive at this point, so it should not be surprising that they pay a higher percent tax per dollar earned than someone earning, say, $25,000 a year. As of 2015, 13.5% of Americans lived in poverty. That's over 40 million people. Hard to have much income to tax in the first place when one is poor. Keep doing the reverse Robin Hood routine and the social fabric of this nation will tear so badly that our norms will disappear and we will descend into the chaos that permeates nation-states with extreme wealth inequality.18 RecommendVin NYC Jan. 6
At the very least, the FICA paycheck deduction should be based on every dollar earned rather than being capped at $128,000, (or so.) For one thing, this would go a long way to solve the problem of shortfalls in the Social Security fund for the large baby boom bump. How is it justified that this deduction should be capped for the highest earners??!Reply 18 RecommendRjW SprucePine NC Jan. 5
@Smokey geo Amazing. We've literally tried the approach you advocate for the past 30+ years, and all the evidence shows that we're worse off. Giving rich people more money on the hop that it trickles down has literally led to stagnant wages, obscene inequality, and lower growth than in the previous decades. You can try to dress it up however you want - feel free to throw another equation our way - but the proof is in the pudding. We've had almost four decades of evidence that refutes your argument.18 RecommendEd New York Jan. 6
@Michael Evans-Layng, PhD, Correlation v. Causation notwithstanding, as in life , tines change. Deductions were abused but companies were reinvesting heavily. Today they buy back their shares and salt the rest away offshore. Bring back the taxes but invest it wisely. Infrastructure, education, health care , research, you know, like China kinda sorta.18 RecommendStacia Redmond, WA Jan. 6
Please, no socialism in the US. It has been tested in many many many places, it is always a failure. Why try??? France has the second highest taxes in the world and massive protests. It is a tempting policy, Why not tax the super rich? Seems to make so much sense. The problem is that IT DOES NOT WORK. Tax at whatever rate you want, 76%, 80%, 99%, lets try for a few year, you'll get some money first and then less, less, less because society gets poorer, people and capital leave, so eventually you're back to where you were but with less wealth. Society needs to create wealth not be obsessed with taking from others. Policy of envy is the worse.18 RecommendMark Zaitz Denver Jan. 5
@Ed So the high tax rates in the mid-20th century were...socialism? Scare tactics aren't helpful. The rest of your comment is demonstrably not true based on our own history. It creates wealth *for our country* when we tax the rich appropriately. We should definitely not be focused on trying to create wealth just for individuals. How does that promote the general welfare? Try again.18 RecommendDr joe yonkers ny Jan. 5
The Dems need to articulate this with greater understanding and confidence. Most people do not understand "effective tax rate," and thus hear 73% and think it's on the entire earnings of an individual. Americans don't understand carried interest, the Soc Sec contribution max on earnings, and SEP and other pre-tax benefits for the wealthy. Then they hear, "Vote for me, I'll cut your taxes," and we deepen the mess.Reply 18 RecommendLarry St. Paul, MN Jan. 6
All I know is that Romney confirmed that he only pays 14 percent. Many of us ordinary folk pay far more and thats ok, but 14 percent?18 RecommendTom New Jersey Jan. 5
Discussions of higher taxes on the wealthy typically fail to clarify that higher taxation rates in all likelihood will only kick in once you reach a certain (much higher) level of income So a taxation rate of 50% on a $1 milllion salary doesn't mean that the individual pays $500,000 in federal taxes. In the 1950s the top tax rate was 91%, but it didn't kick in until you reached an annual income of $200,000, which in today's dollars is about $1.85 million. So what seems like grossly unfair government confiscation of hard-earned income -- when you start throwing around numbers like a 50% tax rate -- is nowhere near as harsh as it seems. According to one website, effective tax rates in the 1950s on the wealthy were closer to 42%. https://taxfoundation.org/taxes-rich-1950-not-high /18 RecommendRichard Waugaman Potomac MD Jan. 5
@Darsan54 Yes, there are too many deductions, but if Democrats are going to protest over removing the deduction for state taxes (a highly progressive reform that only affected high earners), Democrats aren't likely to do away with the mortgage interest deduction, which is the most significant remaining income tax distortion. . AOC and PK both ignore the real elephant in the room, which is the rates of divident (22%) and capital gains (20%) tax rates. We should be taxing capital income at labor income rates, or even better taxing capital itself. Once again, though, the educated elite donor base in the Democratic party would be hurt by taxes on their accumulated wealth. The debate over labor income taxes is mostly a snow-screen so the Democratic party doesn't have to talk about wealth inequality and our failure to tax wealth.18 RecommendBarbara Connecticut Jan. 5
Growing income inequality saps our strength as a nation, as it widens economic disparities and undermines our sense of common purpose. Higher marginal rates for the wealthy will help everyone. The wealthy will surely put patriotism and the common good above greed and self-interest.18 RecommendDeborah Altman Ehrlich Sydney Australia Jan. 5
I know this opinion piece addresses only personal income tax but I don't think you should separate the issue from corporate income tax. As many economists have already noted, based on current research, corporations have plowed most of their windfall from their lower tax rates into buying back stock and rewarding the officers of the company,rather than into higher wages for middle class workers in the company. Let's not forget this crucial inequity and make restitutions in both cases.18 RecommendRAD61 New York Jan. 6
It's not just taxing high earners. In Australia we lose more tax revenue from corporations avoiding taxation. For example, News Corporation (owned by Rupert Murdoch): -- had revenue of A$2 billion and paid no tax on it -- received A$30 million tax dollars from the Federal Government to develop women's sports coverage on his TV channel, Foxtel, coverage which never eventuated. -- his nephew, Matt Handbury, received A$14 million for 'research' which has been totally undocumented, but is believed to have gone to the IPA, a conservative 'think tank' established by Keith Murdoch, Rupert's father. I've no doubt the same largesse to corporations & their owners is seen in the USA, which provides our lot of kleptocrats with so much inspiration.Reply 18 RecommendJulie Carter Maine Jan. 7
Unfortunately, with second-rate economists and third-rate human beings like Arthur Laffer advising them, Republicans are not likely to change their views. It will need Democrat's getting hold of both the legislative and presidential branches of government for sense to prevail.18 Recommend
@Tessa One more time, the tax rate is only on the topmost of the income, not all of it. And not on anything below $10,000,000.
Jun 06, 2018 | discussion.theguardian.com
Anomander64 -> Davesnothereman , 3 Jun 2018 16:44Shhhh... whatever you do, don't ever let them hear you criticizing the "job creators" or there will be trouble.
You know we can't touch the corporations - they are sacrosanct because they are the supposed "job creators" - this one title gives them carte blanche to act however they like, to make spurious claims about economies faltering, businesses going offshore and unemployment. They also donate heavily to the political parties.
Repeat after me:
"Blessed are the job creators"
"Blessed are the job creators"
"Blessed are the job creators"
"For THEY shall inherit the wealth"
Jun 03, 2019 | www.theamericanconservative.com
Alex (the one that likes Ike), says: May 30, 2019 at 1:30 pmAndrew , says: May 30, 2019 at 2:41 pm
While the European Parliament doesn't have too much real power, the most important thing is that it was the dress rehearsal of its countries' national elections. And this rehearsal shows that the establishment is in a bad trouble. Though it was crystally clear since Italy '18.Stephen J. , says: May 30, 2019 at 3:26 pm
What's needed here is a REAL and ACCURATE defining of "center", particularly "center-right" and "fringe". What "center-right"? There is no real "center-right" when it comes to the EU and bowing before the Commission, as the "center-right" agree with pulling in even the marxist in all but name Greens of all countries just so they can keep the real right, the Eurosceptics and Leavers out. All the more reason, Nigel Farage, far from being some right-wing lunatic the BBC would have you believe, is actually at this point being FAR too politically correct, refusing to ally with Le Pen and Salvini. The right HAS TO ally with each other, across Europe, to have any influence. Whining about past statements by old man Le Pen that are 40 years old or crying about the roots of some who support the AfD holds nothing productive for their cause. The "center-right" is nothing but the center-left, incorrectly labeled.EarlyBird , says: May 30, 2019 at 3:56 pm
"the Mainstream Establishment" may have been "Smashed" by "Voters" but the reins of power are still in the hands of the Money Changers and Globalists and their New World Order conspiracy
https://graysinfo.blogspot.com/2016/06/brexit-are-serfs-finally-rebelling.htmlmark_be , says: May 30, 2019 at 3:58 pm
A very healthy development. My concern about it all, however, are the characters of the individuals who lead such revolts against the Establishment. You need outsiders and often obnoxious people to lead such movements, but they often don't make great leaders once they are in. (My biggest problem with Trump is Trump.)
I hope the Establishment gets it – really gets it – and this change in Western politics moves the whole body politic in the correct/reformist direction.JohnT , says: May 30, 2019 at 4:57 pm
"Smashed"? Not even close. A major reshuffling, sure, but the combination of anti-EU parties, eurosceptics, and outright racists hasn't grown all that much. In fact, in the light of how the Brits have mishandled Brexit, certain major anti-EU figures now campaigned on "reform from within" platforms rather than their long-held exit positions. Those who still want to see the EU broken up, or reduced to the next best thing, a neoliberal free-trade zone, remain a tiny minority.
On the other hand, I'll never forgive neither Tories nor Labour that thanks to their stupidity, we still have that bloviating joke of a pied piper running around. He is quite fitting, though, in the era of brainless populism, a Churchill for our time, the man who goads Britain into war against nazi Germany (in his own tiny mind, obviously), then jumps ship when hostilities begin, his job complete: "I have nothing to offer but your blood, toil, tears, and sweat. You shall fight on the beaches, you shall fight on the landing grounds, you shall fight in the fields and in the streets, you shall fight in the hills. If the British Empire and its Commonwealth last for a thousand years, nincompoops will still say, 'This was his finest hour.'"Bannerman , says: May 30, 2019 at 5:44 pm
If lunatics and scoundrels dress in fine attire they are merely better dressed lunatics and scoundrels.Alex (the one that likes Ike) , says: May 31, 2019 at 10:28 am
Even when they move into the living room, leaders of fringe and former fringe parties tend to be ego maniacal prima donas, and have a very hard time getting along, leave alone cooperating for mutual gain.SteveK9 , says: May 31, 2019 at 11:05 am
If lunatics and scoundrels dress in fine attire they are merely better dressed lunatics and scoundrels.
What an apt definition of those, who, among other things, robbed the Greek economy and flooded the EU countries with "refugees", most of whom have never even been in any war zone. let alone Syria.MikeP , says: May 31, 2019 at 11:29 am
Farage's win will lead to the Conservatives under Johnson providing a 'hard Brexit'. When Britain survives and thrives, that will be the nail in the coffin of the EU, at least as it is currently constituted.Stephen J. , says: May 31, 2019 at 3:08 pm
French Foreign Minister Talleyrand had it right when, commenting on Napoleon's defeat, he said of the reconstituted Bourbon Dynasty
"Personne n'est corrigé; personne n'a su ni rien oublié ni rien apprendre"
or as is commonly quoted in English, "They have learned nothing and forgotten nothing."
Plus ça change, plus c'est la même chose, or so our would-be European totalitarians would have it.Mark B. , says: June 1, 2019 at 5:15 pm
The Globalists and their "Establishment" are not "Smashed" yet.
The Evil Union (EU)
There is an evil union called the E.U.
That tells other countries what to do
Many people of these countries did not get to vote
On whether their country should join this huge "lifeboat"
Instead their "leaders" signed their countries away
And now these peoples' are forced to obey
The dictums that emanate from an E.U. cabal
Are they now prisoners of these globalist rascals?
This Evil Union (EU) was planned many years ago
There is evidence to prove this: Do the people know?
They could be the "guinea pigs" of the New World Order
The one world government: the end game of the traitors
How can countries escape from this undemocratic EU?
Are they now prisoners, being told what to do?
By bureaucrats and, an EU, "Unelected Commission"
Has "democracy" been subverted by getting E.U. "admission"?
[more info at links below]
-- -- -- -- -
https://graysinfo.blogspot.com/2019/04/is-globalist-new-world-order-satanic.htmlEliteCommInc. , says: June 2, 2019 at 5:12 am
Excellent outcome for Europe and the EU. The establishment is not smashed. It is put on hold (a bit). The greens are a welcome new block in the parliament. The nationalist-right did win a bit but certainly not as much as predicted.
So now we have a more diverse parliament where discussions and fights will get much harder and for real. Voter outcome is rising too. Just like a real democracy with a real electorat and a real parliament. The EU is growing up. Hurray.EliteCommInc. , says: June 2, 2019 at 5:15 am
" . . . that will be the nail in the coffin of the EU, at least as it is currently constituted."
Make no mistake the "Common Market" is not going anywhere.Siarlys Jenkins , says: June 2, 2019 at 8:19 am
. . . good for them and
"God save the Queen."
If lunatics and scoundrels dress in fine attire they are merely better dressed lunatics and scoundrels.
Ah, but exactly who ARE the lunatics and scoundrels here? There seems to be a wide range of opinions about that.
Jun 03, 2019 | caucus99percent.com
@Raggedy Ann linkJust look at the record. Trump -- a cross between a carney barker and a conman -- beat a neoliberal in 2016. Right-wing populists have scored big in Austria, Italy, Britain, and Brazil since then. Just recently, Australia's right-of-center Labor coalition won their election. And in the European Union's latest contest, Greens won big while right-wing parties made gains in some areas. All these victories came at the expense of neoliberal centrists.up 12 users have voted.
Bottom line: Across the world, people are finally wising up to the fact that neoliberalism has failed them economically, politically, and environmentally. In fact, the climate crisis -- an existential threat to human civilization -- is a direct result of the global neoliberal juggernaut that has swept the developed world. So are the record levels of income and wealth disparity, and the subversion of democracy by a powerful oligarchy -- particularly in the US.
The only folks who didn't get the memo on this appears to be the neoliberal mafia that runs the Democratic Party and the mainstream media here in the US.
At a time when neoliberalism is all but dead, Democrats and the mainstream media are pushing Joe Biden, a neoliberal with a track record of supporting corporations and financial interests above the people's interests; a man who's backed by PACs; a man whose small-bore response to the climate crisis amounts to mass genocide for people and the species we share the planet with.
According to The Hill's media reporter, Joe Concha, Biden is getting more media coverage than all the other Democratic candidates combined, and the month after he announced, in one week alone, Biden was mentioned 1400 times, to 400 for Sanders, who is running second in the polls. This kind of backing by the party and the press is reminiscent of how they treated Hillary Clinton in 2016, and the results will probably be the same.
span ed by ggersh on Mon, 06/03/2019 - 5:29pmThe only problem with w/neoliberalism being deadspan ed by WoodsDweller on Mon, 06/03/2019 - 6:10pm
@gjohnsit it only leaves us with right wing nut jobs,
no other alternative is contemplated.
We're so fucked
And the D's will go the way of the Whigs after
Little donnie will be our last presidentNot dead, but dying.span ted by gjohnsit on Mon, 06/03/2019 - 6:14pm
@gjohnsit Like a brontosaurus with a fatal wound, it thrashes in the swamp, crushing anything nearby, while the nerve impulses crawl towards it's plum-sized brain. Like a blind drunk man whose life is making its final spin around the drain picking a bar fight with a bunch of tough guys half his age. Like a gambler going all in on one last hand. Dying, but not dead, and dangerous because it has nothing left to lose.You can say the same about our empirespan tted by Raggedy Ann on Mon, 06/03/2019 - 6:47pm
@WoodsDwellerLike a gambler going all in on one last hand.
Empire - Imperialism - Neoliberalism
It's all connected.That ISspan ed by Raggedy Ann on Mon, 06/03/2019 - 6:52pm
what WD is saying ~ and quite eloquently, I must add.Neoliberalism is notspan d by polkageist on Mon, 06/03/2019 - 4:54pm
going quietly - it is being dragged out kicking and screaming!I agree.span ed by Raggedy Ann on Mon, 06/03/20
I find the Democrats far more repulsive than the Republicans. At least the Republicans openly avow their evil intentions while the Democrats hide the dagger and poison the chalice (a little hyperbole hurts no one) in order to harm those who trust them. I won't register as a Democrat this time but I will vote for Bernie if the DNC somehow fails to stop him. However, I don't think the Democrats will be that incompetent in obeying the oligarchy's wishes.
Is there a third party candidate? People want to know.
Jun 02, 2019 | www.zerohedge.com
Ralph Nader: Society Is In Decay – When The Worst Is First & The Best Is Last
by Tyler Durden Sat, 06/01/2019 - 21:30 2 SHARES Twitter Facebook Reddit Email Print
Authored by Ralph Nader via CommonDreams.org,
If you want to see where a country's priorities lie, look at how it allocates its money
Plutocrats like to control the range of permissible public dialogue. Plutocrats also like to shape what society values. If you want to see where a country's priorities lie, look at how it allocates its money.
While teachers and nurses earn comparatively little for performing critical jobs, corporate bosses including those who pollute our planet and bankrupt defenseless families, make millions more. Wells Fargo executives are cases in point. The vastly overpaid CEO of General Electric left his teetering company in shambles. In 2019, Boeing's CEO got a bonus (despite the Lion Air Flight 610 737 Max 8 crash in 2018). Just days before a second deadly 737 Max 8 crash in Ethiopia.
This disparity is on full display in my profession. Public interest lawyers and public defenders, who fight daily for a more just and lawful society, are paid modest salaries. On the other hand, the most well compensated lawyers are corporate lawyers who regularly aid and abet corporate crime, fraud, and abuse. Many corporate lawyers line their pockets by shielding the powerful violators from accountability under the rule of law.
Physicians who minister to the needy poor and go to the risky regions, where Ebola or other deadly infectious diseases are prevalent, are paid far less than cosmetic surgeons catering to human vanities. Does any rational observer believe that the best movies and books are also the most rewarded? Too often the opposite is true. Stunningly gripping documentaries earn less than 1 percent of what is garnered by the violent, pornographic, and crude movies at the top of the ratings each week.
On my weekly radio show, I interview some of the most dedicated authors who accurately document perils to health and safety. The authors on my program expose pernicious actions and inactions that jeopardize people's daily lives. These guests offer brilliant, practical solutions for our widespread woes (see ralphnaderradiohour.com). Their important books, usually go unnoticed by the mass media, barely sell a few thousand copies, while the best-seller lists are dominated by celebrity biographies. Ask yourself, when preventable and foreseeable disasters occur, which books are more useful to society?
The monetary imbalance is especially jarring when it comes to hawks who beat the drums of war. For example, people who push for our government to start illegal wars (eg. John Bolton pushing for the war in Iraq) are rewarded with top appointments. Former government officials also get very rich when they take jobs in the defense industry. Do you remember anyone who opposed the catastrophic Iraq War getting such lucrative rewards?
The unknown and unrecognized people who harvest our food are on the lowest rung of the income ladder despite the critical role they play in our lives. Near the top of the income ladder are people who gamble on the prices of food via the commodities market and those who drain the nutrients out of natural foods and sell the junk food that remains, with a dose of harmful additives. Agribusiness tycoons profit from this plunder.
Those getting away with major billing fraud grow rich. While those people trying to get our government to do something about $350 billion dollars in health care billing fraud this year – like Harvard Professor Malcolm K. Sparrow – live on a college professor's salary.
Hospital executives, who each make millions of dollars a year, preside over an industry where about 5,000 patients die every week from preventable problems in U.S. hospitals, according to physicians at Johns Hopkins School of Medicine. The watchdogs who call out this deadly hazard live on a fraction of that amount as they try to save lives.
Even in sports, where people think the best athletes make the most money, the reverse is more often true. Just ask a red-faced Brian Cashman, the Yankees GM, who, over twenty years, has spent massive sums on athletes who failed miserably to produce compared to far lesser-paid baseball players. Look at today's top ranked Yankees – whose fifteen "stars" are injured, while their replacements are playing spectacularly for much smaller compensation than their high priced teammates.
A major reason why our society's best are so often last while our worst are first is the media's infatuation with publicizing the worst and ignoring the best. Warmongers get press. The worst politicians are most frequently on the Sunday morning TV shows – not the good politicians or civic leaders with proven records bettering our society.
Ever see Congressman Pascrell (Dem. N.J.) on the Sunday morning news shows? Probably not. He's a leader who is trying to reform Congress so that it is open, honest, capable and represents you the people. Surely you have heard of Senator Lindsey Graham (Rep. S.C.) who is making ugly excuses for Donald Trump, always pushing for war and bloated military budgets, often hating Muslims and Arabs and championing the lawless American Empire. He is always in the news, having his say.
Take the 162 people who participated in our Superbowl of Civic Action at Constitution Hall in Washington D.C. in May and September 2016. These people have and are changing America. They are working to make food, cars, drugs, air, water, medical devices, and drinking water safer. Abuses by corporations against consumers, workers and small taxpayers would be worse without them. Our knowledge of solutions and ways to treat people fairly and abolish poverty and advance public services is greater because of their courageous hard work. (see breakingthroughpower.org).
The eight days of this Civic Superbowl got far less coverage than did Tiger Woods losing another tournament that year or the dismissive nicknames given by the foul-mouth Trump to his mostly wealthy Republican opponents on just one debate stage.
All societies need play, entertainment, and frivolity. But a media obsessed with giving 100 times the TV and radio time, using our public airwaves for free, to those activities than to serious matters crucial to the most basic functioning of our society is assuring that the worst is first and the best is last. Just look at your weekly TV Guide.
If the whole rotted-out edifice comes crashing down, there won't be enough coerced taxpayer dollars anymore to save the Plutocrats, with their limitless greed and power. Maybe then the best can have a chance to be first.
May 31, 2019 | www.moonofalabama.orgAnne Jaclard , May 30, 2019 7:33:37 PM | 31
Bilderberg 2019 Meeting Information Revealed
Stacey Abrams, Eric Schmidt, Mike Pompeo, and Mattel Renzi, among others, will be attending the top-secret Bilderberh meetings from today through the weekend.
Topics to be discussed include the weaponisation of social media, the future of capitalism, Brexit, China, and threats to the neoliberal world order.
Held since 1954, Bilderberg has acted as a meeting point for high-level establishment politicians and corporate elites to promote the interests of Atlanticism and global corporations.
Many attendees of Bilderberg have gone on to play major roles in their countries' politics, including Angela Merkel and Barack Obama.
The presence of Abrams at the event is another sign that she may act as a vice-presidential candidate for Joe Biden, who himself has attended corporate-linked summits including Davos and the Munich Security Conference this year and who has seen his narratives bolstered by think tanks such as More in Common and the Trilateral Commission.
Abrams is herself a member of the Council on Foreign Relations and has pursued a neoliberal agenda while in office.
May 28, 2019 | www.zerohedge.com
As economist Russ Roberts once wrote in the Wall Street Journal,
"The economy is a complex system, our data are imperfect and our models inevitably fail to account for all the interactions. The bottom line is that we should expect less of economists. Economics is a powerful tool, a lens for organizing one's thinking about the complexity of the world around us. That should be enough. We should be honest about what we know, what we don't know and what we may never know. Admitting that publicly is the first step toward respectability."
In the same vein, I would urge new graduates to be skeptical of those in power who flatter them with the lie that they can, if only they are sufficiently resolute, solve big social problems through government interventions. The truth is that even the best-intentioned government officials do not -- indeed, cannot possibly -- have the knowledge necessary to deliver on any grand promises.
Sadly, this lack of knowledge never stops politicians from spending all of their time pretending that they know it all and none of their time humbly reflecting on the arrogance of attempts to boss the rest of us around. Making matters worse is the fact that the decision-making process in government is not conducive to the best policies. Quite the opposite, in fact. See, politicians spend other people's money and are unduly influenced by special interests. As such, their interests are never served by their taking account of the true costs of their programs, or acknowledging the (too-often invisible) victims of their interventions.
May 23, 2019 | www.counterpunch.org
" Capitalism's gratuitous wars and sanctioned greed have jeopardized the planet and filled it with refugees. Much of the blame for this rests squarely on the shoulders of the government of the United States. Seventeen years after invading Afghanistan, after bombing it into the 'stone age' with the sole aim of toppling the Taliban, the US government is back in talks with the very same Taliban. In the interim it has destroyed Iraq, Libya and Syria. Hundreds of thousands have lost their lives to war and sanctions, a whole region has descended into chaos, ancient cities -- pounded into dust."
– Arundhati Roy
"As naturally as the ruled always took the morality imposed upon them more seriously than did the rulers themselves, the deceived masses are today captivated by the myth of success even more than the successful are. Immovably, they insist on the very ideology which enslaves them. The misplaced love of the common people for the wrong which is done to them is a greater force than the cunning of the authorities. "
― Theodor Adorno, Dialectic of Enlightenment: Philosophical Fragments
"I spent thirty-three years and four months in active military service as a member of this country's most agile military force, the Marine Corps. I served in all commissioned ranks from Second Lieutenant to Major-General. And during that period, I spent most of my time being a high class muscle-man for Big Business, for Wall Street and for the Bankers. In short, I was a racketeer, a gangster for capitalism ."
― Smedley Butler, War is a Racket
"It is no longer a choice, my friends, between violence and nonviolence. It is either nonviolence or nonexistence. And the alternative to disarmament, the alternative to a greater suspension of nuclear tests, the alternative to strengthening the United Nations and thereby disarming the whole world, may well be a civilization plunged into the abyss of annihilation, and our earthly habitat would be transformed into an inferno that even the mind of Dante could not imagine."
-- Martin Luther King, Jr., Remaining Awake Through a Great Revolution, 31 March 1968
Empire understands nothing except ruthless expansion. It has no other raison d'etre. In the past this meant the violent acquisition of lands and territories by a militarized system where [miliraty] caste was very apparent and visible. But today the dealings of empire are far more duplicitous. The ruling order of this age expands empire via the acquisition of capital while using the military industrial complex to police its exploits. But there is an insidious social conditioning at work which has led the general public to where it is today, a state of "inverted totalitarianism" as political philosopher Sheldon Wolin explained. Indeed, capitalism has morphed into the unassailable religion of the age even among the working class. Its tenets are still viewed as sacrosanct.
Violence is the sole language of empire. It is this only currency it uses to enforce its precepts and edicts, both at home and abroad. Eventually this language becomes internalized within the psyche of the subjects. Social and cultural conditioning maintained through constant subtle messaging via mass media begins to mold the public will toward that of authoritarian conformity. The American Empire is emblematic of this process. There is mass compliance to the dictates of the ruling class and this occurs most often without any prompting or debate whatsoever. In this dictatorship of money the poor are looked at with ridicule and contempt, and are often punished legally for their imposed poverty.
But the social conditioning of the American public has led toward a bizarre allegiance to its ruling class oppressors. Propaganda still works here and most are still besotted with the notion of America being a bastion of "freedom and democracy." The growing gap between the ultra-wealthy and the poor and the gutting of civil liberties are ignored. And blind devotion is especially so when it comes to US foreign policy.
Most Americans still believe they live in the greatest country on the planet. They believe the American military to be noble and that they always reluctantly go into or are forced into war. Indeed, both the Democrats and Republicans possess an uncanny ability to bridge their ideological distances when it comes to defending US militarism, the Pentagon and the war machine of imperialism. But this is tied to the defense of capitalism, the ruling class, and the ultimate reason for war: the protection of that class's global capital investments.
The persecution of Chelsea Manning, much like the case of Julian Assange, is demonstrative of this. It is a crusade against truth tellers that has been applauded from both sides of the American establishment, liberal and conservative alike. It does not matter that she helped to expose American war crimes. On the contrary, this is seen as heresy to the Empire itself. Manning's crime was exposing the underbelly of the beast. A war machine which targeted and killed civilians and journalists by soldiers behind a glowing screen thousands of miles away, as if they were playing a video game.
Indeed, those deadened souls pulling the virtual trigger probably thought they were playing a video game since this is how the military seduced them to serve in their ranks in the first place. A kind of hypnotic, addictive, algorithmic tyranny of sorts. It is a form of escapism that so many young Americans are enticed by given their sad prospects in a society that has denuded the commons as well as their future. That it was a war based on lies against an impoverished nation already deeply weakened from decades of American led sanctions is inconsequential....
... ... ...
Today Iran and Venezuela are once again in the crosshairs of the American Empire's belligerence. Their defiance to the dominant [neoliberal] socioeconomic order will simply not be tolerated by the global ruling caste, represented as the unquestioned "interests" of the United States. The imposed suffering on these nations has been twisted as proof that they are now in need of American salvation in the form of even more crippling sanctions, coups, neoliberal austerity and military intervention. As the corporate vultures lie in wait for the next carcass of a society to feed upon, the hawks are busy building the case for the continuation and expansion of capitalist wars of conquest.
Bolton and Pompeo are now the equivalent of the generals who carved up Numidia for the wealthy families of ancient Rome, with Trump, the half-witted, narcissistic and cruel emperor, presiding over the whole in extremis farce. Indeed, the bloated orange Emperor issued the latest of his decrees in his usual banal fashion, via tweet:
"If Iran wants to fight, that will be the official end of Iran. Never threaten the United States again!"
One can query when Iran, or any other nation has ever "threatened" the United States, but that question will never be asked by the corporate press who are also in service to Empire. They are, in fact, its mouthpiece and advocate. The US has at least 900 military bases and colonial outposts scattered around the planet, yet this is never looked at as imperialistic in the least by the establishment, including its media. Scores of nations lie in ruins or are besieged with chaos and misery thanks to American bellicosity , from Libya to Iraq and beyond. But the US never looks back in regret at any of its multiple forays, not even a few years back.
To be sure the American Empire, which has seldom seen a year without pillage of another nation or region, is now facing its greatest nemesis. Unheeded lessons of the past have made it thoroughly inoculated to its own demise. In short, it is drunk on its hubris and unable to grapple with its inevitable descent.
... ... ...
American Empire knows no other language sans brutality, deceit and belligerence...
... ... ...
The American Empire, one of the shortest lived in human history, has become the biggest threat to humanity ...
But like all empires it will eventually fall. Its endless and costly wars on behalf of capital investments and profiteering are contributing to that demise . After all, billions of dollars are spent to keep the bloated military industrial complex afloat in service to the ruling class while social and economic safety nets are torn to shreds...
Comments from The Belligerence Of Empire Zero Hedge9 hours ago
Nowadays the US has a massive military and little else. And "when the only tool you have is a hammer, every problem has to look like a nail" - Wesley Clark, Former US General.
14 hours ago
Twaddle. Capitalism has lifted out of poverty more people around the globe than all other "successful" systems combined; and in a fraction of the time. Education. Health. Wealth. Not to mention Arts and Sciences.
Go demand a refund for your liberal education. And stop spreading lies.
11 hours ago (Edited)
Poppycock! Capitalism has traded real sovereign wealth for fiat debt backed funny money at the barrel of a gun! You assholes have been forcing otherwise healthy communities into poverty for decades so you could steal their resources and molest their children! Why? Because children are the only people impressed by your tiny d!cks!
The white male gaze that drives child sex tourism Feelings of disempowerment lead to vulnerable families, children
The organization described the average sex tourist as a middle-aged white male from either Europe or North America who often goes online to find the " best deals. " One particular Web site promised "nights of sex with two young Thai girls for the price of a tank of gas."
Sowmia Nair, a Department of Justice agent, said the Thai government often "turns a blind eye" to child sex tourism because of the country's economic reliance on the tourist trade in general . He also said police officers are often corrupt.
" Police have been known to guard brothels and even procure children for prostitution," Nair said. "Some police directly exploit the children themselves."
A report from the International Bureau for Children's Rights said the majority of child prostitutes come from poor families in northern Thailand, referred to as the "hill tribes." With limited economic opportunities and bleak financial circumstances, these families, out of desperation, give their children to "recruiters," who promise them jobs in the city and then force the children into prostitution.
Sometimes families themselves even prostitute their children or sell them into the sex trade for a minuscule sum of money.
This is not by accident! This is by design!
14 hours ago
Capitalism has nothing to do with this. For the average American the empire is a losing proposition.
13 hours ago (Edited)
Empire good. Emperor bad. Kingdom good. King bad. Country good. President bad. Village good. Idiot bad.
13 hours ago (Edited)
Empire is cancer. Especially the present one that leaves a trail of failed states and antangonism in its wake.
16 hours ago
We are part of a scientific dictatorship - the 'Ultimate Revolution' Huxley spoke of in 1962 where the oppressed willingly submit to their enslavement. Social conditioning - promoted by continuous propaganda stressing that the state is their protector, reinforced by endless 'terrorist threats' to keep the masses fearful is but one part of the system.
The state no longer has to use threats and fear of punishment to keep the masses under control - the masses have been convinced that they are better off as slaves and serfs than they were as free men.
The US Republic has come and gone - the Empire is failing rapidly despite massive spending to support it. Cecil Rhodes and his heirs dreamed of restoring Anglo American domination of the world yet despite all of the technology employed the US is losing grip. By sheer numbers (and a far more efficient dictatorship) China is moving to a dominant role.
18 hours ago
Capitalism and corporatism are not the same. When corporate interests effectively wield gov power, you have corporatism, not Capitalism.
14 hours ago
18 hours ago 'Muricanism is the gee-gaw of the chattering classes.
18 hours ago (Edited)
The US is its own worst enemy. They have no idea what they are doing. 2008 – "Oh dear, the global economy just blew up" Its experts investigate and conclude it was a black swan.
It is a black swan if you don't consider debt. They use neoclassical economics that doesn't consider debt.
They can't work out why inflation isn't coming back and the real economy isn't recovering faster.
Look at the debt over-hang that's still left after 2008 in the graph above, that's the problem. The repayment on debt to banks destroy money pushing the economy towards debt deflation.
QE can't enter the real economy as so many people are still loaded up with debt and there are too few borrowers.
QE can get into the markets inflating them and the US stock market is now at 1929 levels. They have created another asset price bubble that is ready to collapse leading to another financial crisis.
We need a new scientific economics for globalisation, got any ideas?
What if we just stick some complex maths on top of 1920s neoclassical economics?
No one will notice.
They didn't either, but it's still got all its old problems.
The 1920s roared with debt based consumption and speculation until it all tipped over into the debt deflation of the Great Depression. No one realised the problems that were building up in the economy as they used an economics that doesn't look at private debt, neoclassical economics.
What's the problem?
- The belief in the markets gets everyone thinking you are creating real wealth by inflating asset prices.
- Bank credit pours into inflating asset prices rather than creating real wealth (as measured by GDP) as no one is looking at the debt building up
1929 and 2008 look so similar because they are; it's the same economics and thinking.
What was just a problem in the 1920s in the US is now global.
At 25.30 mins you can see the super imposed private debt-to-GDP ratios.
The 1920s problem in the US is now everywhere, UK, US, Euro-zone, Japan and China.
20 hours ago (Edited)
Capitalism is based on darwinian economic competition driven by a desire to accumulate material wealth. When a capitalist becomes sufficiently rich, he can (and does) buy politicians and armies to do his bidding. Ironically, although capitalism is based on the assumption of competition, capitalists actually hate competition and harbor the urge to put competitors out of business. The true goal of a capitalists is monopoly-- as long as it is them.
Imperialism is a logical (and historically predictable) expansion of capitalism.
18 hours ago
Capitalism may not be the path to peace, but just about every other ism, including socialism and communism delivered worse.
Attacking capitalism for common failings is off base.
15 hours ago
Socialism and ultimately communism appear when capitalism goes rampant, and it is normal for the socium to embrace socialism when the inequality becomes too large.
In the end, the elite has no problem to rebrand themselves any color it needs to take to rule again, and become totalitarian state. As it becomes in the Soviet Union and China.
So don't mistake the people's desire for equal world with totalitarian capitalism masked as socialism.
14 hours ago
the real issue is NO GROUP OF HUMANS can be trusted will any form of power. ever. period.
so it goes that no "xyz"ism" will ever work out for the whole. yet humans are social animals and seek to be in groups governed by the very people that strive to lead that exhibit sociopathic tendencies, which are the worst possible leaders. how fuked up is that?
so how can that work? it does for a while. then we end up in the same spot every time, turmoil, the forth turning.
the luck of life is the period of time you live during, where and what stage of human turmoil the society is in...
21 hours ago (Edited)
" Capitalism's gratuitous wars and sanctioned greed have jeopardized the planet and filled it with refugees".
Capitalism did all that huh? It had nothing to do with corrupt politicians in bed with corporations and banks. Now they even have the military singing the same stupidity. Governments make these messes, not capitalism. Someone who risked their life for a corrupt government giving the pieces of **** that put him there a free pass by blaming it on capitalism. What a moron. When politicians hear this stupidity, it's like music to their ears. They know they've successfully shifted the blame to a simple ISM. Governments want to blame the very thing that will fix all of this, for the sake of self-preservation.
18 hours ago
Every system acts to centralise power, even anarchism. So you say it was wealth that enabled what was to follow but it was really power.. something every -ism will centralise and enable.
22 hours ago
Another blame America article that fails to mention the International Banksters. They have the finger-pointing thingy down to an art form.
16 hours ago
Really! Did you miss the Smedley Butler quote?
22 hours ago
Could you please distinguish between capitalism and political, monetary, fiscal, press, and legal aberrations that can occur in capitalist systems because of government sloth and malfeasance? Media monopoly, mass illegal immigration, and offshoring are not the essence of capitalism. And socialist systems can see hideous abuses.
Please read something more than **** and Jane adventures.
23 hours ago
"... is still the owner of the world's biggest nuclear arsenal."
Here is the list of all nine countries with nuclear weapons in descending order, starting with the country that has the most nuclear weapons at hand and ending with the country that has the least amount of nuclear weapons
- Russia, 6,850 nuclear warheads
- The United States of America, 6,550 warheads
- France, 300 warheads
- China, 280 warheads
- The United Kingdom, 215 warheads
- Pakistan, 145 warheads
- India, 135 warheads
- Israel, 80 warheads
- North Korea, 15 warheads
23 hours ago
It is now building a $100 million dollar drone base in Africa...
China 'negotiates military base' in Djibouti | News | Al Jazeera
China is negotiating a military base in a strategic port of Djibouti, the president said, according to the AFP news agency. The move raises the prospect of US and Chinese bases side-by-side in the ...
China May Consider These Countries For Its Next Overseas ...
Oct 10, 2017 · China and the small African nation of Djibouti reached an agreement in July to let the People's Liberation Army establish up its first overseas military base there. The base on Africa's east ...
China is building its first military base in Africa . America ...
China is building its first military base in Africa . America should be very nervous. ... In Africa , China has found not just a market for money but for jobs and land -- crucial components of ...
23 hours ago (Edited)
Oh noes! 1 base in Africa.....meanwhile the empire has 800 outposts around the world and despite that, like a snowflake, is bitching about China's one.
Isn't it fascinating how the Chinese do not find it necessary to resort to retarded regime change projects and stoopid kikery to "win" influence? Easy peasy. Methinks the Anglo-Zionists can learn a trick or two from China.
23 hours ago
The empire of 800 outposts is puny compared to the 1960's and 1970's. I can provide the information if you'd like. Almost all the 800 have company sized or smaller contingents. Still, I'd like to see much of it dismantled. No world Policeman.