Sunday, February 17, 2019

Nonsense on Stilted Language: A Review of Nine Pages of Michelle Murphy’s "The Economization of LIfe"

I’m a professor at Evergreen State College.  This year I assigned a new-ish book I hadn’t yet read to my class, and to my chagrin I discovered it was pseudo-scholarship instead of the real thing; so I wrote the following apologia

Saturday, February 16, 2019

Another Question for the Census

The Trump gang has kicked up a ruckus over its plan to insert a question about citizenship in the 2020 decennial census.  It’s a transparent attempt to reduce the response rate of immigrants, disenfranchising them in reapportionment and government spending formulas, despite the Constitution’s call for an enumeration of “persons”, not citizens.

But why stop at citizenship?  When you think about, there is no government interest greater than its ability to collect taxes, the main obstacle to which is tax avoidance, legal and illegal.  Researchers looking into this problem, not to mention government analysts themselves, struggle in the face of rampant secrecy.

So why not use the census to get a better picture of tax cheating?  Insert just a single question, “Within the past year have you failed to pay your lawful federal, state or local tax obligations?”  Respondents should be reminded that a dishonest answer constitutes a violation of federal law.  The fine is small compared to most tax avoidance, but the last thing most tax scofflaws want is added attention to their financial duplicity.

I can see the confusion when the numbers are tallied in 2021.  “Gee, there are all these big houses, shady streets and golf courses, but according to our data no one actually lives here.”

Thursday, February 14, 2019

Who Is Really A Socialist?

Here are some varieties of "socialism:" command socialism, market socialism, socialist market economy, social democracy, democratic socialism, right wing socialism, utopian socialism, corporate socialism, just plain vanilla socialism.  Here are some people who have claimed to be socialist, some of them selecting one or another of these types, but some just keeping it plain vanilla generic: Kim Jong-Un, Xi Jinping, Stefan Lofven, Nicolas Maduro, Bernie Sanders, Aexandria Ocasio-Cortez (AOC).  Who is really a socialist and can we make any sense of all this?

Among the strictly economic issues involved here, aside from the political ones, there are three that stick out prominently: ownership, allocation, and distribution.  The first may be the most important, or at least the most fundamentally traditionally classical: who owns the means of production? This is bottom line Marx and Engels, and they were unequivocal: socialism is state ownership of the means of production, even though in the "hiigher stage of socialism" generally labeled "pure communism," the statte is supposed to "wither away." Capitalism is private ownership of the means of production, although there are debates over some intermediate collective forms such as worker-owned collectives, something favored by anarchistic and utopian socialism and its offshoots and relatives.

Regarding allocation the issue is command versus market, wiith command in its socialist form coming from the state, although clearly a monopoly capitalist system may involve command coming from the large corporations, with this reaching an extreme form in coeporatism and classical fascism, sometimes called corporate socialism.  Needless to say, it is possible to have state ownership of the means of production, classical socialism, but some degree of markets dominating allocative decisions.

Then we have distribution.  In the Critique of the Gotha Program, Marx said the goal of communism was "from each acording to his ability, to each according to his need."  Emphasizing if not precisely that at least a focus on minimizing poverty and supporting those in need as well as increasing the overall level of income and wealth equality is another element of many forms of socialism.  This focus has been especially strongly emphasized by social democracy and its relatives, although most forms of socialism have at least officially supported this, if not always in practice.

Regarding our list of socialisms, where do they stand on these three, adding in the big political issue of democracy and free rights versus dictatorship, well: command socialism involves as its name suggests both command in terms of allocation combined with state ownership of the means of production, with no clear outcome on distributional view.  Historically permanent command as a system has coincided fully with dictatorship, including when this occurs with capitalism as in fascism, especiallly in its German Nazi form, a nearly pure form of command capitalism. The classic  model of this form was the USSR under Stalin, with its leading current example being the Democratic Peoples' Republic of Korea (DPRK), aka North Korea, which pretty much tells us what kind of socialist Kim Jong-Un is.

Market socialism combines state (or collective) ownership of the means of production with market forces driving allocation decisions.  The old example of this that also had that holdover from utopian socialism of workers' management, was Tito's not-so democratic Yugoslavia, which blew up, although its former provincce of Slovenia eventually was the highest real per capit income of all the former officially socialist nations.  According to Janos Kornai, market socialism, including his home of Hungary, suffered from the problem of the soft budget constraint, although we have seen that in many mostly market capitalist economies with rent seeking powerful corporations.

There is no clear difference between market socislism and the "socialist market economy," but the Peoples' Republic of China (PRC) has gone out of its way to officially label itself this latter term, perhaps due to the collapse of Yugoslavia.  Many, including the late Ronald Coase, claim China is really capitalist, but in fact while there is now much private ownership, state ownership remains very strong, and while there is no longer organized cental planning, command elements remain important, and the ownership situation is very complicated, with many firms having substantial while partial state ownership.  In principle this form could be democtatic, but it is not at all that in Xi's current PRC, which has had a largely successful economic system for the  last four decades, despite high inequality and other problems. In any case, this is the system Xi Jinping is identified with.

Social democracy now is the form that emphasizes distributional equality and support for the poor over the ownership and alllocation elements.  This is now, most dramatically in the Nordic nations, although it has had a weaker version in Germany in the form of the social market economy.  The name "social democracy" comes from the now century and a half old German Social Democratic Party, within which at the end of the 19th century several of these forms debated with each other, although in the end what came out, inspired by the original "revisionist" Eduard Bernstein, was what we now call social democracy, which is indeed politically democratic and supporting an expansive welfare state, while not pushing either  state ownership or command.  Stefan Lofven is the current prime minister of Sweden and also leader of the Social Democratic Party of Sweden.  A welder and union leader, Lofven just managed to get reelected and form another government last month, although his new government is "moving to the center," and while he is certainly a social democrat, he has also described himself as being a "right wing socialist," and Sweden has pulled back somewhat from its strongly social democratic model over the last quarter of a century.

Which brings us to democratic socialism, currently highly faddish in the US given that both Bernie Sanders and AOC have identified themselves as followers of this ideology.  The problem is that of all the others mentioned, this one is the least well defined, and Bernie and AOC themselves seem to disagree.  Thus when pushed Bernie posed Denmark as his model, which is a leading example of social democracy, arguably more so even than Sweden now, although its current prime minister is not a Social Democrat (party) and argues that Denmark is "not socialist" (noting its lack of command state ownership).  But AOC has at times said that democratic socialism is not social democracy, while exactly what it is remaiins not well defined.

One source might be the platform of the Democratic Socialists of America (DSA), which AOC officially belongs to.  This supports a democratic and decentralized form that emphasizes worker control, if not clearly ownership, with this harking to utopian socialism, with an ultimate goal of state or some other form of collective ownership, but not in this document command. AOC herself has now pushed forward the Green New Deal, (GND) which should perhaps be labeled "Green Socialism," yet another form.  I do not wish to get into a discusson in this post of the details of the GND, regarding which there has been some confusion (retracted FAQ versus 14 page Resolution) about which there remain some uncertainties. DSA has at times nodded to the British Labour Party, which after 1945 under Clement Atlee, both nationalized many industries while expanding the social safety net, while avoiding command central planning.  However, the GND seems to avoid nationalizations, while emphasizing a major expansion of rhe social safety net, along with some fairly strong command elements laregely tied to its Green environmental part, arguing that mere market forces will be insufficient to move the US economy off its current fossil fuel base soon enough.

Which brings us to generic socialism and the still not described Nicolas Maduro, President of Venezuela.  He is loudly describing himself a socialist, but what form, if any, is unclear. But his economy is the biggest current economic disaster on the planet, so his ongoing claims of being a socialist are damaging the label, as seen in the eagerness of conservatives to identify socialism with him and denounce people like Bernie and AOC and all the Dem prez candidates signing onto the GND even before they knew what was in it, with this exemplified by Trump ranting loudly on this theme during his SOTU.

Looking closely it seems that indeed Maduro and Chavez before him, who preferred labeling the system "Bolivarianismo" rathet than "socialism," did carry out portions of various of the forms of socialism.  Many firms were narionalized, with currently the number of privately owned firms about half of what there were 20 years ago (when Chavez was elected), although many of those original firms have simply disappeared.  About 20% of farmland was nationalized, mostly large-scale latifundia, supposedly to be turned over to landless peasants.  But much of it has simply come to be uncultivated by anybody. In any case, there remain large portions of the economy privately owned, with still wealthy owners living in gated communities and not suffering.

Perhaps the most damaging of the socialist policies have been scattered efforts at command, not based on any central plan, especially using price control.  In agriculture this has been a complete disaster, especially once hyperinflation hit.  Food production has collapsed, and lack of food has driven 3 million out of the country, with many still behind having lost much weight.  OTOH, the regime is supposedly being green by emphasizing traditonal local crops. But this is not even a joke. Bolivarianismo's main positive was its popular redistribution policy, which increased real incomes in poor areas, especially while Chavez was in power, borrowing from the social democracy model.

The problem here is that all of these things, even many oof them together, have been recently tried in neighboring nations, such as  Bolivia, without simialrly disastrous results. Somehow Venezuela has just completely blown apart, with reportedly 86% of the population now opposed to Maduro and people in the poor neighborhoods of Caracas who were the Chavismo base now out demonstrating in large numbers (and being violently suppressed) after Maduro got reelected in a clearly fraudulent election, with most of his neighbors calling for his removal.

I think two things not related specifically to socialism have played crucial roles here: corruption and hyperinflation.  The most important agent in the Venezuelan economy is the state-owned oil company, which was nationalized long before Chavez came to power.  But he, with Maduro made this worse later, fiirng the competent technocratic managers of that company and replacing them with political cronies, with the outcome being a serious decline in oil production, this in the nation with the world's largest oil reserves.  Which leads to the other problem, massive corruption, with the incompetent cronies at the top of the state-owned oil company the worst.  The other killer item has been the hyperinflation, whose source I do not really know, although Venezuelan tax rates are lower than those in the US.  Certainly part of it is massive budget deficits, and as the MMT people note, they were borrowing from abroad.  I do not fully understand all involved in the hyperinflation, although that is not a standard phenomenon in a full-blown command socialist economy, but the hyperinflation has clearly been the final killer of the economy, collapsing support for Maduro. Apparently about a third of the population still supports "socialism," while many of those people reject Maduro, claiming he has blown what Chavez implemented, which Maduro certainly has.

So, for a summary.  Command socialims a la the DPRK is an awful diasster, famine plus dictatorshiip.  Market socialism/socialist market economy a la China has been good at rapid economic growth and much else, although suffering many ills on the environment and income distribution, not to mention alo being dictatorial.  Social democracy a la Swden and Denmark has done as well as any economic system on the planet and is democractic and free, but has also suffered from various problems.  The "democratic socialsim" of certain American politicians remains poorly defined and is in danger of being tied to the disastrous and vaguer form of "socialism" happening in Venezuela, with the danger for US politics being that conservatives may actually succeed in tying this pooerly defined democratic socialism with the barely socialist disaster in Venezuela.

Personally, I wish that Maduro would stop calling himself a socialist. Then he should also resign and get lost for the good of his people ASAP, although I do not support overdone US efforts by sanctions or possible invasion to bring this about.  Let it be the Venezuelan people who remove him, however.

Barkley Rosser


Wednesday, February 13, 2019

Test Tube Politics: llhan Omar, Anti-Semitism and AIPAC

I don’t think I’ve ever seen a political statement triggering evidence (mixed) about its own truth as dramatically as Ilhan Omar’s quip that pro-Israeli bias in congress is “about the Benjamins, baby”.  It’s as if you wrote a letter criticizing the Post Office and had it returned to you with a USPS message stamped on it.

But let’s dig down one level.  The criticism, partly fair, of Omar is that she bought into (so to speak) the anti-semitic slur that Jewish money constitutes a secret conspiracy against “the people”.  This is the old socialism-of-fools stuff, endlessly recycled by bigots right up until this morning; see the demonization of George Soros, for instance.  Because it exists, people who want to combat bigotry—and this includes progressive politicians—should build a giant moat around it and not go there.  By suggesting that hidden Jewish money had bribed Congress into blind support for Israel, Omar crossed a line.  It’s the same line that George Bush senior crossed with the Willie Horton ad, and that Trump crosses a dozen times every Twitter-soaked evening.  Invoking a bigoted stereotype is a bad thing to do, especially for politicians with giant megaphones.

Yet the very response to Omar’s tweet demonstrated the truth she was stumbling for.  A chorus of political and media honchos of every denomination, religious and political, rose up to denounce her.  They didn’t make fine distinctions and they didn’t welcome a correction; their goal was to punish and silence.  Sweeping accusations were made against Omar’s character, leaving the impression that any criticism of AIPAC, the powerful pro-Israel lobby, was proof of antisemitism.  And this attempt to isolate and politically crush Omar was itself the embodiment of her protest.  This is the power of AIPAC in action, the lobby that can’t be named, the doctrine—the transcendental importance of Israel and the rightness of its religious self-definition—that can’t be questioned.

So the truth content of the original Omar tweet depends on how we explain this onslaught.  If it’s really just about the Benjamins (the hundred dollar bills with Ben Franklin looking back at us), that means she was being trashed, directly or indirectly, for pay.  Politicians joined the mob either to protect their campaign revenue or shield themselves from other politicians defending their own campaign revenue.  How likely is that?  The answer depends on two prior questions: how important is campaign finance in setting the basic contours of US policy, and what proportion of this finance is controlled or strongly influenced by AIPAC?

These are questions for specialists in these areas, not me.  I will go out on a limb, however, and say that the truth lies between the endpoints: some but not all of the bias in the US political system is attributable to the influence of big donors, and AIPAC has a substantial but far less than a complete lock on the flow of political money.  You could compare it to other lobbies, like the NRA (National Rifle Association) and AARP (American Association of Retired Persons), both of which are feared for their ability to alter the balance of funding in competitive political contests.  But neither of these two outfits is immune from attack, while AIPAC is.  Gun control advocates go after the NRA all the time, and, while AARP is not exactly a political lightening rod, the complaint that greedy seniors are stealing money from our children is a popular meme on the Right.  So AIPAC is different.  This difference does not seem to be about money, at least not solely, as important as money is to the system and the groups that try to dominate it.  AIPAC appears to possess a complementary form of power, perhaps rooted in the infrastructure of synagogues and other religious organizations as well as the allegiance of many socially prominent Jews active in secular organizations.  When it marshals this network, you get the sort of response we saw to Omar.

This was a ferocious rebuke of a politician, clearly intended to be career-ending.  It will be interesting to see if she can recover without abandoning her advocacy of Palestinians; I certainly hope so.  The attack on Omar, however, is itself the embodiment of the fear all of her colleagues have to feel, that if they step out of line on Israel they will be crushed.  Catering, intentionally or otherwise, to antisemitic tropes is completely unnecessary: the proof of the pudding is in the attack on it.

Tuesday, February 12, 2019

Lyndon LaRouche Is Dead (but not dead enough)

In lieu of an obituary, I am reposting Politics of Pastiche: "voters... need someone to fire all the political-correct police" from August 2015. See also The Higgins Memo, Anders Breivik and the Lyndon LaRouche Cult and Deep Structures of the Cultural Marxism Myth. And Here’s an Insane Story About Roger Stone, Lyndon LaRouche, Vladimir Putin, and the Queen of England.
"...voters crave the anti-status-quo politician. They want results. They need a fighter. They need someone to fire all the political-correct police." -- Sarah Palin, interview with Donald Trump
Anders Breivik
In the introduction to his "compendium" manifesto, 2083: A European Declaration of Independence, mass-murderer Anders Breivik asked, "What is Political Correctness?" and "How did it all begin?" His answer dwelt on the Frankfurt School, and singled out Herbert Marcuse's Eros and Civilization as especially important.  Breivik's text was copied and pasted almost verbatim from a screed called "Political Correctness: a Short History of an Ideology?" by William S. Lind, "Director of the Center for Cultural Conservatism at the Free Congress Foundation."

In turn, the "cultural Marxism" thesis of Lind's "history" can be traced to a 1992 article, "New Dark Age: Frankfurt School and Political Correctness,"  published in a Lyndon Larouche cult magazine, Fidelio The article's author, Michael J. Minnicino, subsequently disowned his work as "hopelessly deformed by self-censorship and the desire to in some way support Mr. LaRouche's crack-brained world-view."

Along the way, "conservative" Republican stalwarts Ralph de Toledano and Patrick J. Buchanan have recycled those crack-brained conspiracy theories, documented by abundant footnotes that typically lead either to a source who didn't say what they were credited with saying, to some other hack propaganda recycler or to an "authoritative" emigre like Victor Zitta or Lazlo Pasztor relying extensively on official histories published by the Axis-allied Horthy regime. Martin Jay traced the strange trajectory of this propaganda meme in "Dialectic of Counter-Enlightenment: The Frankfurt School as Scapegoat of the Lunatic Fringe."

Roger Kimball
This month saw the publication by Roger Kimball's Encounter Books (an "activity" of the Bradley Foundation) of yet another rehash of the discredited crap, The Devil’s Pleasure Palace: The Cult of Critical Theory and the Subversion of the West, by Michael Walsh. A credulous review of that book in the Washington Free Beacon presents the book's argument, apparently oblivious to its dubious lineage:
In The Devil’s Pleasure Palace: The Cult of Critical Theory and the Subversion of the West, Walsh argues that the current obsession with politically correct speech began with a group of Marxist academics at the Institute for Social Research at Goethe University in Frankfurt, who would come to be known as the Frankfurt School. The scholars, Georg Lukács, Theodor Adorno, Walter Benjamin, Erich Fromm, and Herbert Marcuse, among others, developed a wide-ranging, if often contradictory, critique of the principal tenets of "bourgeois" Western culture—from the centrality of reason and individuality to Christian sexual mores.
As Barkley and I have discussed, the term "politically correct" probably was popularized in the late 1960s and early 1970s by left-wing student activists wary of the self-righteous dogmatism displayed by self-styled Marxist-Leninist political grouplets. But that's not the way the conventional mythology goes.

At the end of December 1982, the Wall Street Journal published an op-ed, "The Shattered Humanities" by William Bennett, who at the time was chairman of the National Endowment for the Humanities. Bennett's complaint was that "matters of enduring importance" -- "the true," "the good" and "the noble" -- had been abandoned because "we have yielded to the bullying of those fascinated with the merely contemporary." By the early 1990s, Bennett's lament about the decline of traditional values in the humanities had swelled into a moral panic about the alleged tyranny of political correctness on campus, fueled by best-selling books such as Allan Bloom's Closing of the American Mind, Roger Kimball's Tenured Radicals: How Politics has Corrupted Our Higher Education and Dinesh D'Souza's Illiberal Education: The politics of race and sex on campus. 

Even President Bush I had to get into the act with a commencement address at the University of Michigan at Ann Arbor in which he railed against "political extremists [who] roam the land, abusing the privilege of free speech, setting citizens against one another on the basis of their class or race."
Ironically, on the 200th anniversary of our Bill of Rights, we find free speech under assault throughout the United States, including on some college campuses. The notion of political correctness has ignited controversy across the land. And although the movement arises from the laudable desire to sweep away the debris of racism and sexism and hatred, it replaces old prejudice with new ones. It declares certain topics off-limits, certain expression off-limits, even certain gestures off-limits. 
Isolated anecdotes and broad generalizations can only get you so far. The elusive scourge of political correctness needed to be explained by theory of its origins. Thus the Minnicino/Larouche conspiracy theory, taken up by Lind, Buchanan, de Toledano, Breivik and now Walsh.

In spite of being called out more than two decades ago by a President of the United States, those political extremists liberals on the left have allegedly persevered in their "unrelenting demands... for increasingly preposterous levels of political correctness over the past decade." This, according to S. E. Cupp explains Donald Trumps popularity: "Trump survives -- nay, thrives! -- because he is seen as the antidote, bravely and unimpeachably standing athwart political correctness."


Meanwhile, "A new Rasmussen Reports national telephone survey finds that 71% of American Adults think political correctness is a problem in America today, while only 18% disagree. Ten percent (10%) are undecided."
National Survey of 1,000 American Adults
Conducted August 25-26, 2015
By Rasmussen Reports 
1* Do Americans have true freedom of speech today, or do they have to be careful not to say something politically incorrect to avoid getting in trouble?

2* Is political correctness a problem in America today?
Hey, if they keep repeating it, it must be true, right?

Three Stooges: Lyndon Larouche, Roger Kimball, Anders Breivik




Monday, February 11, 2019

It Is Monday And Usual Suspect Bashes Social Security

That would be Robert J. Samuelson at the Washington Post, and, yes, he has done it yet again, actually for the first time in a while.  Dean Baker has already done a good job of cutting him up over on CEPR, but I can't help piling on as well.

Samuelson presents his case as opposition to Social Security being expanded as proposed by Cong. John Larson (D-Conn).  Samuelson also cites a recent study Andrew Biggs at AEI supposedly showing that old people have been doing better in income terms than previously reported. 

Dean notes several points.  One is that the current setup of Social Security is that is going to be reducing benefits over the next few years as retirement ages get raised as a result of long past agreements, actually dating to 1983.  The supposed expansion by Larson is quite minor and mostly just offsets this planned reduction, although not precisely.

Another point is that while it is true that while some older people have been doing better than previously reported, although not the poorest recipients, the main source of this better performance is due to something that will be disappearing in the near future.  It is due to income from defined pensions, which have nearlyi all disappeared.  Such income will be less and less important for older people as time proceeds.

I shall add to these valid points one other.  It is a par for the course nearly alll times RJS gets off onto this topic.  Early in his column he sets up as how disastrous for future budget balances all these awful "entitlements" will be is to cite projections for Social Security, Medicare, and Medicaid all lumped together.  So, according to the CBO, while federal trnsfers to over 65s in 2005 was 35% of federal outlays, and those rose to 40% in 2018, these are projected to be 50% in 2029.  Now while this might happen if no  changes happen, the overwhelming majority of this increase is due to texpected further increases in medical care prices, not due to an increase in use, much less an increase in Social Security spending.  It is only a couple of those projected percent increases.

He does this all the time, citing these kinds of scary looking aggregate numbers and then jumping to focus on Social Security and how we need to cut benefits (and certainly block any proposed increases in benefits).  He never talks about how maybe we should make serious reforms in our health care system that would really put a serious dent in those projected increases. I recognize that this is a lot harder than it may seem (see all the battles over Obamacare).  But RJS simply shreds his own credibility by failing to make this point before he jumps right in to wildly exaggerate the fiscal issues related to Social Security.

OTOH, given how much just totally weirdly wacko things that have been going on, having Robert J. Samuelson back on his old Mondy morning schtick bashing Social Security is almost a nostalgic relief, a return to older and simpler times.

Barkley Rosser

Saturday, February 9, 2019

The 1912 Bread and Roses Strike

Elizabeth Warren made an impressive speech just now in the freezing cold of Lawrence, Massachusetts:
Sen. Elizabeth Warren officially launched her 2020 presidential campaign Saturday at a rally in Lawrence, Massachusetts, using the backdrop of Everett Mills -- the site of a historic 1912 labor strike led by women and immigrants -- to issue a call to action against wealthy power brokers who "have been waging class warfare against hardworking people for decades." Over 44 minutes in sub-freezing temperatures, Warren described a political elite "bought off" and "bullied" by corporate giants, and a middle class squeezed so tight it "can barely breathe." "The man in the White House is not the cause of what is broken, he is just the latest and most extreme symptom of what's gone wrong in America," Warren said of President Donald Trump. "A product of a rigged system that props up the rich and powerful and kicks dirt on everyone else. So once he's gone, we can't pretend that none of this ever happened."
Warren has staked herself as the true progressive in terms of those who have already announced. I’m sure many others will comment on the specifics of her speech so let me note this 1912 strike:
The power looms that thundered inside the cotton weaving room of the Everett Mill in Lawrence, Massachusetts, suddenly fell silent on January 11, 1912. When a mill official demanded to know why workers were standing motionless next to their machines, the explanation was simple: “Not enough pay.” The weavers who had opened their pay envelopes that afternoon discovered their weekly wages had been reduced by 32 cents. A newly enacted Massachusetts law had reduced the workweek of women and children from 56 to 54 hours, but mill owners, unlike in the past, cut worker’s wages proportionally. For workers who only averaged $8.76 per week, every penny was precious, and 32 cents made the difference between eating a meal or going hungry.
This story notes how this strike grew in force. How did it become known as the bread and roses strike?
Women didn’t shy away from the protests. They delivered fiery rally speeches and marched in picket lines and parades. The banners they carried demanding both living wages and dignity—“We want bread, and roses, too”—gave the work stoppage its name, the Bread and Roses Strike. Lawrence, known as “Immigrant City,” was a true American melting pot with citizens from 51 nations wedged into seven square miles. Although strikers lacked common cultures and languages, they remained united in a common cause. The social networks of the day—soup kitchens, ethnic organizations, community halls—stitched the patchwork of strikers together. And once news of the walkout went viral in newspapers around the country, American laborers took up collections for the strikers and local farmers arrived with food donations.
Warren was smart to pick this town and cite this 1912 strike as its all inclusive nature serves as a perfect backdrop for what will be an all inclusive Presidential campaign.

Ruminations On Vriginia's Difficult Situation

A week ago I posted here supporting VA Gov Ralph Northam, comparing him favorably to the late Robert C. Byrd of WV.  A day later I joined the call for him to resign after his bizarre press conference that has still left unpleasant unresolved issues such as who put that awful photo in his yearbook and why.  Since then much else has come forth, and this continues. In any case it looks like Northam may hang in for at last awhile, although the situation is complicated and constantly changing, to put it mildly. What I intend to add in this post beyond the latest news is a combination of inside local infornation as well as, hopefully, a deeper historical perspective.

Last morning's (Friday, 2/8), Washington Post top headline was that Northam would not resign soon, and late this afternoon I as an employee of the  Commonwealth  of VA received an email message saying he hoped we would all support him continuing to lead the state, while carefully not being too out there too much on that he would stay in office for his full term.

One reason why he was not going to resign immediately, even without the recent collapse of his most immediate successors, is that until Feb. 23 the VA legislature is debsting a serious budget issue.  The Trump tax law has resulted in a revenue windfaall for Virginia.  This involves technical details I know but will not bore any readers of this with. So there is an ongoing debate in the VA legislature on what to do with this extra money, with the barely majority GOP in the legislature saying give it all to upper middle income persons, while Northam and the Dems have proposed giving half of it to lower income people while using the other half to fund various state initiatives. If this current scandal had not appeared I think  Northan would have gotten an agreement not too far from what he wanted. Now in his weakened state, the ultimate compromise will be closer to the GOP version.

For any not following the news since a week ago, both of Northam's immeiate successors hhave themselves come under unpleasant scrutiny.  Lt. Gov. Justin Fairfax has now been seriolusly acccused of two sexual assalutls. When accused of the first he denied  it and hired an attorney.  The second accusation coming a few hours ago is of rape, and while earlier many were supporting him to replace Northam, this now seems to have become unlikely.  I note that I never liked Fairfax, Iknow all these people personally, and the African American I would like to seee as governor is Levar Stoney, currently Mayor of Richmond and a grad of JMU where I teach.

And now the second in line to the governorship of VA, assuming that both Northam and Fairfax resign (neither of which at this point has so far remotely come close to doing so), is  Attorney General Mark Herring, now in his second term, having stepped aside from running  for Lt Gov to let the now seriously damaged J. Fairfax run for that.  Last Thursday AG Herring revealed that he also had performed in blacface in 1980 at UVa at age 19.

If  Northam, Fairfax, and Herring all resign or forced out of office, then the acting governor will be the Speakr of the Hoouse, Kirk Cox, not only a Republican, but one how just gave an impassioned anti-abortion speech full of ridiculously irrelevelant Biblical passages, given that there is nothing in the  Bible that directy forbids abortion.

As it is, it appears that all of this blew up because Northam is a pediatrric neurologist, who only recently became a politician. So when Dems in the VA legislature attempted to loosen rules on late abotions, Dr. Northam got into rare and weird cases I was not aware of involving treatment of deformed fetuses and whether one born should be"revived." Personally, I do not know how to deal with such exremely rare cases, although baically siding with mothers and their physicians.  But Republicans cherry picking this overly specfic discussion by Dr. Northam turned it into "infanticide," with Trump making this charge in his SOTU.

More immediatley and seriously the rumor I have heard is that what triggered the revelation of that embarrassing photo in Northam's yearbook came as a result of his professional testimony about this  odd and rare case, which his opponents seized on, blocking any expansion of abortion rights in VA and providing fodder for Trump's ranting in his SOTU about "infanticide," a false charge.

But back in VA, reportedly a rommate from med school of  Northam got ticked off by this medical testimony by Northam, and then leaked the story to whhatever media about  the yearbook photos.  This set off he should resign, leading us to the now  unaccepable (although I read he  has hiired lawyers, puke), and then the now damaged AG Herring. While so far Speaker Cox is "clean," aside from being  a far right  winger, the  GOP majority leader of the stat senate, Norman Tennant, has been accused of a half century ago being an editor of a yearbook containg racist photos.

I have lived in VA for 42 yearss and have deep south ancestry includingVA.  But this matter has made me realize that for all my deep family backgound going back to the 1600s in VA, I was a and am a "damned yankee" to all those born and raised here.  My parents were born and raised in Deep South northern Florida, and when young I spent serious time there.  This made me think I knew the South, but I now know that ultimately I was  an outsider, especially given that i went not only to high school in liberal/progressive Madison, Wisconsin, where the state capitol building has a museum for the Grand Army of the Reuplic, the ultimate hard core of the northern Union that won the Civil War ("War of Northern Aggrsssion according to a cousin of my father that my wife from USSR/Russia met in 1987).

So a big revelation to me in the last week is how widespread this "blackfacing" and related racist manifestations were even into recent times.  The yearbook where Northams  photo appeared (Eastern Medical School of Virginia) had racist photos as recently as 2013, when the then dean just shut down the yearbooks.  I have never seen a blackfaced performance, but now  old very liberal and local friends have been surfacing with old past incidents of racist conduct.  This sort of resembles post-WW II France, where many collaberated with the Nazi Vichy regime, but then later joined the anti-Nazi Reistance. Eventuallly this became a matter of when one  turned from one side to the other, and good liberal close friends have been essentially playing postwar French fessing up to just exactly when they stopped using the "n-word," much less blackfacing.

The deeper history of all this is in Virginia 400 hundred years ago in 1619 when on the one hand the oldest continuing English speaking legislatiive  body in North America was founded, the same one (with some modifications over the centuries), that I noted above is trying to resolve the Trump tax "reform" with VA tax law. The other is the first arrival in what is now the  USA of African slaves.  Needless to say, this latter matter is on many minds and relevant to this current  controversy.

To make things even worse, it was in Virgiinia in 1705 that the crucial laws were passed fully establishing that slavery was to be of people of African descent and that those people could not marry anyone of European descent. So cince then in 1860 the state had more slaves than any other, its capitol became the that of the Confederate States of America, with half the bsttles of the succeeding Civil War (or "War of Northertn Agression" according to some of my cousins of earlier generations), and then its state capital became the capital of the Confedracy. This led to half the battles of the Civil War being fought in Virginia.

More recently we had the  Byrd Machine supporting reistance against racial integrstion of public  schools after Brown vs Board of Education in 1954.  Eventually this was all over come. But in the private places, including many frats on many campuses until very recently, racist practices such as "blackfacing" persisted.  And although the worst violence came from outsiders, in Charlottesville in August, 2017, wwe saw overt racist violence in Virginia.

Eventually this has become personal. With all these revelations, very liberal friends of  mine have now outed thesselves as having been varyng degrees of racist in the past. I now  realize that  while I have deep southern ancestry including high officers in the Confederate army, I was born and raised in the North.  I did  not see all this  stuff, and I did not personally haave to go through this process of personally deracizing myself, which I now realize my deep southern parents went through, my fahter moving from deep south racist Democratic Party affiation when he went to math grad school in Princeton in the 30s to being a Republican, When he took us in 1963 to uber-progrssive Madison, Wisconsin, well, no wonder I did not do blackface.

A final bottom line is that Gov. Northam's still uresolved yearbook photo has the absurd possibility of a racial reconciliation to all this.  I do not know why he continues to claim no knowlege of the origin or handling of this od photo of blackfaced white person standing next to someone wearing a KKK hooded outfit that is in his medical school yearbook.  But while whateveer relation it had to Gov. Northam personally, it could be interpreted in its superficial stupidity as also showing a possible  racial reonciliation for the long and troubled racial history of Viriginia.  This now shocking photo shows a blackfaced man standing peacefully next to somebody wearing a KKK outfit.  While indeed the obvious interpretation of  thos photo supports racism, another interpretation is of harmony among the races, even including the old southern racists of the  KKK.

Obserivng old Virginia friends of mine now confesssing their past racist behavior and  views, it seems that for them this looks sort of like the post-WW II French. After the war they were supposedly all anti-Nazi and supporters of the anti-Nazi Resistance.  But, of course, many did work for the pro-Nazi Vichy regime after the German conquest of France in 1940.  But then, as the Allies increased their obviouly ultimate victory over that regime, more nd more former collaboraters with the Vichy regime would quit and join the Risistance.  Eventually this game became a matter of timing one's switch from working for a ruling Vichy to an anti-Vichy/Nazi Resistance.

Several of my good friends now confessing their past racist conduct have put it in these terms: it has become a matter of timing, just when did one finally stop doing these bad old behaviors?  Reportedly Ralph Northam only learned two years ago that "blackfacing" was not socially acceptable.  Whatever comes out of the current crisis in Virgina, hopefully in the future we shall  have better informed and more deepl understanding leaders in Virginia and more broadly.

Addndum: 2:30 PM, 2/9/19: The VA legilslature has reportedly come to an agreement on its budget dispute.  Apparently the agreement tilts strongly towards what the GOP members favored due to the weakness of the Dems arising from these scandals involving their elected leaders in the state.  Not surpsing.

Barkley Rosser



Thursday, February 7, 2019

"I’m not sure I follow the arithmetic here."

"Unless productivity goes up by at least 25% to compensate, everyone will be worse off." 
"Dropping hours from 5 days a week to 4 means that the work that would have been done in 5 days now needs to be done in 4, which means each day needs a 25% increase in productivity. Where on earth do you think such an increase is going to come from?" 
"OK, but to arrive at the same output in 4 days rather than 5 means that people have to become 25% more productive than they are today. That’s an awfully big jump in productivity. I’m not convinced that people today are that unproductive. Certainly when I think of my past workplaces, I don’t think my colleagues were that sub-optimal. A 10% increase in productivity seems more reasonable."
Following up on yesterday's post about comments in the Guardian, here are some thoughts about "where on earth" a productivity increase of 25 percent might come from:

Let's start from a 40-hour week in which the rate of output declines somewhat toward the end of the day when workers are beginning to tire. Let\s assume the least productive eight hours of work produce only 75 percent of the output of the most productive 32 hours of work. Call the average output of the most productive 32 hours "one unit" of output. Total output for 40 hours work is 38 units.

Now, reduce the weekly hours to 32. Better rested, more motivated workers result in a "reasonable" 6.25 percent increase in average hourly productivity above and beyond the productivity gain from eliminating the least productive hours. Total output in 32 hours is now 34 units compared with 38 units previously produced in 40 hours.

Those are physical units of output not the monetary value of that output. Assume diminishing marginal utility of the total output. The last four units of output add less value per unit than the first 32 units. So let's say in value terms 34 units = $34 but 38 units = $37. We are now producing 92 percent of the value previously produced in 80 percent of the time.

Instead of earning $15 an hour for a 40-hour week, a worker now earns $17.23 an hour for a 32 hour week. That's a 15 percent increase in hourly wage coupled with a 20 percent decrease in weekly hours. Not too shabby! Considering that there are costs associated with commuting to work, etc., the 92 percent retention of weekly income might effectively be closer to full compensation.

All of the above, of course, is simply the fleshing out of assumptions. We assumed  diminishing productivity in the last hours, we assumed heightened productivity from a shorter working week and we assumed declining marginal utility of goods and services produced. Finally, we assumed a preference for free time over a vanishingly small increment of total income. The point is that each of these assumptions were relatively modest but when combined "add up" to a rather substantial cumulative result.

Wednesday, February 6, 2019

"Just doesn't add up'"

  • "I’m not sure I follow the arithmetic here."
  • "It's all down to the numbers - something the article avoids and so is just pie-in-the-sky."
  • "That clearly does not add up."
  • "If you produce X in 30 hours you will produce > X in 40 - unless you are just sitting on your arse for the extra 10 hours."
  • "If you work 40 hours your total output will be higher than if you work 30 hours - unless you are actually destroying output in those extra 10 hours."
The U.K. think tank Autonomy has published a report on working time, "The Shorter Working Week: A Radical And Pragmatic Proposal." Autonomy's co-director, Will Stronge, wrote an Op-Ed for the Guardian on Friday that outlines some of the proposal's main points. The Guardian piece received over 600 comments, around a quarter of which were opposed to the proposal. I am always fascinated with why people are hostile toward seemingly good things so I downloaded the comments and sorted and coded them. 

Twenty-eight percent of the negative comments included gratuitous disparaging remarks about the article and its author. "Riiiiight. ...whoever dreamed up this silly notion hasn't got a clue about the realities of life." "This drivel is always coming from some useless twit who sits on their backside…" "Yes, the article is nothing but pie-in-the-sky." "Really?  It's all a bit if a pipe dream isn't it?" "Comrades , rejoice!  Tractor production will still be up 130%." "Along with flying cars and pet unicorns for all, presumably." "Following the columnist's logic, why not a three day week? Or a two day week?" "better still just pay me full time but I don't want to turn up at all." 

Fifteen percent of the negative comments dwelt on what they perceived as the mathematical incongruity of the proposal. This compared with less than seven percent of the positive comments that mentioned arithmetic and around two percent of the neutral or digressive comments that did. 

Opponents of shorter working week were confident that the relationship between hours of work and units of output was "a simple sum in arithmetic" the result of which was patently obvious to them: "If you produce X in 30 hours you will produce > X in 40 - unless you are just sitting on your arse for the extra 10 hours." Some critics explicitly assumed that a 20% reduction in hours would have to be made up by a 25% increase in output to be economically feasible. Others conceded that a reduction in hours could result in an increase in hourly productivity but insisted that total output would inevitably be substantially less in the shorter week.

There are several subtleties to the mathematics of shorter hours that opponents systematically overlook. One is that the relationship between hours and output is dynamic and cumulative, not static and instantaneous ("fatigue and unrest"). Second is that the value of aggregate output isn't necessarily proportional to the quantity of output ("diminishing marginal utility"). Third is that the lost value of foregone leisure and additional stress and "wear and tear" to a worker has to be reckoned against the value of additional income ("opportunity cost"). Fourth, a shorter standard working week may shift proportions of income going to labor and to capital, respectively. And, finally, that shift in the distribution of income is likely to have an impact on final demand ("propensity to consume"). All of these subtleties are in addition to the more generally -- albeit, not universally -- acknowledged fact that physical output doesn't necessarily increase in proportion to hours of work even in the static case.

To make a long story short, critics of the shorter work week proposal commit the same errors that adherents to the wages-fund doctrine did in the 19th century and that led Nassau Senior to insist that the profits of enterprise were entirely due to the last hour of the working day. It is none other than the original, the actual, the one-and-only "lump-of-labor fallacy" committed obsessively and unabashedly by opponents of shorter working time!

How To Go After The US Wealthy Reagan Style

Ah yes, this is going to be another one of those ironic posts about what a big leftist liberal Ronald Reagan was compared to the current GOP gang in charge of so many of our policies, especially our tax policies.  Certainlly the image of Reagan is one who cut taxes for the high income wealthy, and in general that is the case.  But there were a few items going the other way, and again, compared to current policies some combination of what came out of the two major Reagan tax cuts looks downright progressive by comparison.

Let us start with taxing wealth, with the Elizabeth Warren proposal to put a 2 to 3% annual wealth tax on those holding over $50 million.  I am not opposed to this in principle, but worry that it faces very serious practicsl problems of implementation due to the high costs involved in simply determining the wealth of these large and complicated portfolios, especially given the hollowing out and reductions at the IRS, which would have to do all of it.  As it is, whereas not too long ago 20 nations taxes wealth, that is now down to three: Norway, Spain, and Switzerland, with the latter lacking either a property tax or a capital gains tax. What have those other 17 nations done?  Well, going in the opposite direction from where the US has gone under Trump with his tax "reform."  Indeed, a moddel might well be what we saw in the Reagan tax laws.  So, one of the most important both as a redistribution mechanism taxing wealth while also raising revenue would be to return to the Reagan 1986 tax law's taxing capital gains at the same rates as income is.  The other one is also to undo the cuts in estate taxes Trump has put it and move back to what Reagan had in place after his 1981 tax law, a much more redistributive system than we see now.  Both of these, especiallly the capital gains tax change, would be easily to implement and enforce.

On income taxes, the proposal byu AOC for a top marginal income tax rate of 70% does not face the implementation problems the straiight wealth tax faces.  As noted putting this only on those earning over $10 million per year should not be too damaging on various fronts, although it would probably not raise all that much revenue.  It might be better to go with what ccame in with the 1981 Reagan tax law of a top marginal rate of 50%, but having it on a broader set of upper income people.  This would arguably both raise more money than the AOC proposal while also arguably having fewer disincentiv effects.  So, rerturning to a combination of the Reagan 1981 and 1986 tax laws might be something that can be adopted, implemented, and enforced, which would both raise more revenues, and engage in wealth and income redistribution.

Barkley Rosser

Monday, February 4, 2019

The End Of The End Of The Cold War

It is a sign of how wacko things hve gotten that the truly most important event of the past week has simply beeen buried in the news by all the juffing and puffing over Trump's shutdown ending and these reveleations about VA Governor Northam.  This would be decidion by the US on Feb. 1 to withdraw from the Intermediate Nuclear Force (INF) treaty with Russia, followed by Russia's doing so as well shortly thereafter.  This is both historic and very serious, far more so than Trump's wall or Northam's photographs.

The treaty was signed in 1987  between then US President Reagan and then Soviet President Gorbachev, culminateing several years of negotiations.  It led to the destruction of around 36oo short and intermediate range nuclear missiles, including most importantly all of those in Europe that threatened the potential outbreak of a war on that continent between NATO and the USSR..  It was one of the most important moments on the way to bringing about the end of the end of the Cold War, and indeed it is unfortunately accurate to describe the ending of this treaty as the end of that end.

I have seen a number of people speculating that this action somhow shows Trump "standing up" to V.V. Putin, being a tough guy and all that.  But the nearly immediate acceptance with virtually no complaint by Putin of this move suggests otherwise. US and also western European officials have argued that Russia has been in effective violation of the INF since 2014 when it developed a new cruise missile, 97M925,  that can be easily modified to make fly in the forbidden distance ranges.  Russian leaders have arruged that they were not in violation given that this missile alsso had as its main ranges ones not in violation and none violating the lmits had been deployed that they were not in violation.  Putting such missiles with the violating ranges in deployment would directly threaten western Europe.  As it is, Putin is in a position now to rapidly deploy them in a way to threaten western Europe while the US has nothing to put in place to reply to this.  So, Putin gets to gain a major military edge and threaten the western Europeans while getting to blame Trump for having ended the treaty by with drawing and allowing him to do this. The Europeans in question had opposed Trump ending the treaty, with indeed this probably being one of those things Merkel was trying to maintain influence with Trump over by not complaining too loudly about the US pressuring German companies to stop dealing with Iran.

Another factor in this matter emphasized by US leaders is that China was never a part of the agreement, and I gather has been developing such intermediate range missiles.  But those were unlikely to be deployed in Europe, where the removal of such missiles 32 years ago was a ttriumphant movement towards the reduction of mutual tensions and towards peace.

All the way around, there is nothing good at all about this development, and it most definitely soes not show Trump doing something that is against the interests or desires of V.V. Putin. The outcome may well be a new arms race, which will please the military-industrial compleses in both the US and Russia, and maybe China as well.  No, this is not a good development at all.

Barkley Rosser

Sunday, February 3, 2019

Will INSTEX Replace SWIFT Bank Exchange?

Probably not, but reportedly a "White House insider" is afraid it might.

Instex is the new exchange created by UK, France, and Germany, to be based i Paris and run by a German banker, to get around US sanctions against Iran.  Apparently it will sell Iran humaanitarian goods such as pharmacueticaals and food not subject to the sanctions, with those being paid for with Iranian petroleum that will then get sold elsewhere, none of this involving any US dollars.  It is probably too small to threaten the dominance of the international SWIFT bank exchange system, but this does open up the possibility for nations to avoid US limits on their international financial transactions, with the US having used the SWIFT system in the past to crack down on unfavored nations.

Addendum:

There is a long, front page story in the Washington Post this morning about this matter Griff White and Erin Cunningham. For sstarters, I can relay that "Instex," which should probably be INSTEX, stands for "Instrument in Support of Trade Exchanges."  Second is that the Trump'c campaign to get European, and especially German, companies to obey the anti-Iran US sanctions has beeen very agrressive and largly run out of the US Embassy in Berlin, with US Ambassador ro Germany, Richard Grenell, the point man on this.  He had received press attention and criticism by some German business people when he arrived in Berlin last May and publicly called for German businesses to withdraw from Iran.  That criticism did not slow him down one bit, and his efforts have led to some major German companies to withdraw, notably Siemans, VW, and Daimler-Benz, all of which have large-scale operations in the US.

But Grenell's efforts have gone far beyond that.  People from his embassy have personally visited the HQs of many German companies, many of which have little connections with the US and much larger dealings with Iran, pressuring them in many ways, some friendlier, some involving threats and real actions.  The most dramatic of the latter have come from the US apparently poressuinrg Deutsche Telekomm, which owns T-Mobile in the US, suddenly ending internet access and other telecom privileges for some of these compaines without warning, seriously disrupting their activities.  Unsurpeisingly, this has drawn more sharp criticism from German business leaders.

What it does not seem to have drawn much of is open complaints from the German government, with Angela Merkel apparently for now trying to minimize conflicts with Trump, with there being so many issues at hand over which she and Trump differ.that she is sort of holding her fire for the biggest ones, and so far this stuff seems to be more an annoyance rather than super big, and with perhaps the strong German support for starting INSTEX sending the signal for now.

There is also the matter that Germany and several other of the major European powers are unhappy with Iran for apparently attempting to assassinate some of its own enemies from the MEK on Belgian and French soil last year, with several of those nations having institutes their own tightly focused sanctions on specific  bodies in Iran identified with that effort.  So there is a balancing act going on here, with Germany in particular opposing the US sanctiona and wanting to support the JCPOA backed by moderate Iranian President Rouhani, while themselves sanctioing hardline elements in the Iranian regime causing unwanted trouble in Europe.

I also note that in addition to UK, France, and Germany, the European Union is officially supporting the establishment of the INSTEX.  For now it is a small operation not llikely to have too much effect on all this, but its potential for the future is another matter.

Barkley Rosser

Saturday, February 2, 2019

I Support Virginia Governor, Ralph Northam

Current media is denouncing  VA Gov Ralph Northam with many demanding he resign now over an unfortunate incident in his youth.

I note that that the final crucial person who gave us Obamacre was  the late Robert C. Byrd of West Virginia.  He was in his youth a member of the Klu Klux Klan, indeed held some office in it. In the end when the ultimate votes in the Senate came, which had Rebublicans denouncing him over his 1940s support of the KKK, and  some of them openly hoping he would die as he was in bad health and did die rereafter, Robert Byrd did show up for the ultimately  crucial vote, wheeled in in a wheelchair, to cast the ultimstely finsl crucial vote that gave us  ACA/Obamacre, which despite its many flaws has  imroved the health of many people in America.

Regarding Ralh Northam, an extremely excellent and super competent governor  of Virginiia, a  few days ago, affrimered the right of women to make the ultimate desicisons regarding their bodies with the support of just one doctoe (three are now needed), he has just been deonouned on alt-reich and even Hannity outlets for his defense of a woman'ss right to choose. The attacks on him from the organized right on this matter have been horrendous.  They have accused him of supporting "infanticde."  This charge is disgusting and falose.  But the GOP istrying to make his supremely responsible and medically wise view a crime. They are just hypocrites.

I will not call those now demanding Northam's resignation over hiis unfortunate photo from 35 years ago hypocritees.  Indeed I sypathaize, especially wiith African Americans, who have had to facr all kinds of racism here in Virrgina as in the awful violence in Charlottesville in 2017 as well as the ongoing refusal at the sattate level to allow local governments to remove Confederate statues and monuments.   It may well be that Northam will feel in the end that he must resign for his youthful mistake.  But I think iit will be unfortuate as he really has been a good governor ans is personally a nice guy (I have met him).  The pboto certainly does not represent his current views at all.

Addendum, 3:25 PM, 2/2/19

I fear that I am increasingly leaning to Northam needing to resign, despite my generally high regard for him.  He has just made a public statement that has really confused things, and I fear he may simply have fatally damaged his governorship with how he has messed this story up.  He is now claiming that he is not in the photo, but says he did blacken his face once in 1984 to pretend to be Michael Jackson for a dance or skit, where he even won a prize (ugh).  He also says he is not the person now he was then and is begging for forgiveness.  I guess he deserves the latter, but he made a real botch of this, and I fear it will not get better.  Ironically the lt. gov who would replace him if he were to resign, Justin Fairfax, is African American.  Anyway, I am sorry about this whole situation, but now fear Northam simply cannot clean up the mess he has made of it.

Barkley Rosser

Tuesday, January 29, 2019

Robert H. Nelson Dies: Religion And Economics

Robert H. Nelson of the University of Maryland Public Policy Department died at age 74 on Dec. 15 while attending a conference in Helsinki, Finland.  He was the leading economist writing about the relationship between religion and economics, notably in three books: Reaching for Heaven on Earth: The Theological Meaning of Economics (1991), Economics as Religion: From Samuelson to Chicago and Beyond (2001), and The New Holy Wars: Economic Religion vs. Enviornmental Religion  (2010).  I spent several days with him some years ago at a conference on forestry issues where he was presenting his views on environmentalism as religion.  In any case, his death has me thinking about the broader issues he wrote about.  I shall note the arguments in these books along with some further observations.

His first book was essentially a history of economic thought that put a certain theological perspectve on thnkers mostly from the fairly distant past. A basic theme in all of his books is that economics is a form of secular religion that posits a material salvation in some distant future as a result of economic  growth and redistribution, a material heaven on earth.  In that book he posed two competing theological strands in the history of economic thought: a Roman (Catholic) "rationalism" and a Protestant "revelationism."  The former started with Aristotle and included such figures as Aquinas, Adam Smith, Saint-Simon, and Keynes.  The latter started with Plato and Augustine, Calvin, Darwin, Spencer, and Marx.  A number of observers criticized this pair of categories, noting particularly that virtually the only economist in the second list is Marx (although Spencer did write on economics somewhat).  I happen to share the criticisms that it is not clear how useful or meaningful this pair of lists is, although the tradition of lining up historiccal intellectual figures as being Aristotelian or Platonic has a long history in philosophy.

But this does make me think about the especially strong theological/religious element in Marxism, with people "believing" in the philosophy and even specific Marxist economics doctrines such as the labor theory of value.  There has been a long history of people "converting" to Marxism and then sometimes "converting" away from it, sometimes becoming religiously anti-Marxists in their disillusionment to a fanatical degree.  As an old recognition of this I note a comparison made by Bertrand Russell, someone who considered himself to be a reasonable Aristotelian against troublesome Platonic idealists (recognizing that Marx claimed to be a materialist, not an idealist).

Yahweh (God) = Dialectical Materialism
Messiah = Karl Marx
The Second Coming = The Revolution
The Saved = The Proletariat
The Church = The Communist Party
Damnation to Hell = Expropriation of the Capitalists
The Millennium = The Socialist Commonwealth

The second book got more attention than the first and in some sense made a more obvious point: that current schools of thought can be viewed as sects whose differences ultimately boil down to matters of belief.  The subtitle of "From Samuelson to Chicago and Beyond" indicates the sorts of schools of thought Nelson was thinking of.  My sense is that the Old Keynesian versus Classical Monetarist split was probably less theological/religious than some other splits among economic schools of thought, such as indeeed Marxists and their polar opposites the Austrians.  Nevertheless, many people arguing over the Keynesian versus Old (and newer) Monetarists sometimes seem to fall into the terminology of "belief," often buried in the matter of assuming axioms that cannot be questioned.  So, looking at the New Classical school one finds Sargent at one point declaring rational expectations to be an axiom that cannot be questioned and must be used in any serious economic analysis.  One must "believe in rational expectations," even if one knows that it is factually inaccurate (and Sargent would later grant indeed that ratex is indeed false).  Of course with Samuelson it is not just his Keynesian macro but also his defense of standard neoclassical microeconomics, with this having also a theological/religious aspect to it.

I would add a sociological element to this general Nelson argument that many economics debates between schools of thought often seem to take on a theological or religious aspect, even if most participants usually at least put on a show of respecting facts and logical rigor and so on.  It is an old observation made esepcially by some observers of British economics that especially in the late nineteenth and early twentieth centuries there was a tendency for people who became professional economists to come from families that included actual ministers of the Anglican Church (or other denominations), with this coinciding with a decline of that church and its influence.  To some extent this is conisstent with the origin of economics in Britain in moral philosophy, which is what Adam Smith was a professor of, and with the very first Professor of Political Economy in Britain being Thomas Robert Malthus, who was in fact actually also an ordained Anglican priest.  More generally many economists, although certainly not all, seem to be at least partly driven by motives "to do good," a sentiment easily coming from people who may be secular on the surface but come from family bsckgrounds of religious practitioners (I confess this might apply to me, with both my quite religious mother's grandfathers having been Proetestant ministers).

The third of these books may deal with a more serious and controversial issue, the matter of "economic religion" (more or less as described above) against an erstwhile "environmental religion," with many anti-environmentalist Christian ministers denouncing environmentalism for being a competing anti-Christian religion drawing on paganism and other alternative religious impulses.  For Nelson, both of these are "secular religions," but he recognizes that the environmentalist movement (in contrast to some extent to environmental scientists) has a spiritual side that can be quite fervent and draws on various religious traditions, although it must be noted that increasingly current Christians of at least some denominations are emphasizing environmental themes.  But some opposed to these recent views emphasie how the monotheist Judeo-Christin-Muslim tradition has emphasized humanity dominating nature with a "be fruitful and multiply" view.  Such a view then merges with the materialist economic "Heaven on Earth" to be delivered by economic growth.  In the non-Christian environmentalist "religion" one finds both the Earth Mother worship of neo-paganism but also the Buddhist Economics strand one finds in Schumacher's Small is Beautiful book that de-emphazies economic growth and sees nirvana as being in a low consumption economy that is associated with a condition of envitonmental harmony that is nirvana on earth.

Barkley Rosser