tag:blogger.com,1999:blog-49003032391540481922024-03-15T21:09:58.937-04:00EconoSpeakAnnals of the Economically IncorrectUnknownnoreply@blogger.comBlogger5415125tag:blogger.com,1999:blog-4900303239154048192.post-15739498260597107272024-03-09T17:28:00.011-05:002024-03-12T15:06:24.979-04:00Matt Huber's and Leigh Phillips's "classical Marxist critique" of Kohei Saito<p>I have expressed my disagreement with Kohei Saito's <a href="https://econospeak.blogspot.com/2024/01/lost-in-translation-slow-down-by-kohei.html" target="_blank">Slow Down</a> and <a href="https://econospeak.blogspot.com/2023/11/growth-below-zero-and-development-of.html" target="_blank">Marx in the Anthropocene</a> in previous posts. I welcome Huber's and Phillips's critique of Saito at <a href="https://jacobin.com/2024/03/kohei-saito-degrowth-communism-environment-marxism/" target="_blank">Jacobin</a>. They get much right in their criticism of Saito's Utopianism and implicit primitivism but they share with Saito a fundamental misreading of Marx. This misreading is based on a speculative interpretation of a stirring but ambiguous passage in Marx's Preface to his 1859 <i>Contribution to the Critique of Political Economy:</i></p><p></p><blockquote>In the social production of their existence, men inevitably enter into definite relations, which are independent of their will, namely relations of production appropriate to a given stage in the development of their material forces of production. The totality of these relations of production constitutes the economic structure of society, the real foundation, on which arises a legal and political superstructure and to which correspond definite forms of social consciousness. The mode of production of material life conditions the general process of social, political and intellectual life. It is not the consciousness of men that determines their existence, but their social existence that determines their consciousness. At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or—this merely expresses the same thing in legal terms—with the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an era of social revolution. The changes in the economic foundation lead sooner or later to the transformation of the whole immense superstructure.</blockquote><p></p><p>The misreading of the above became canonical as the "classical Marxist theory of history" as expounded by Lenin, Stalin, and a host of Second International luminaries. As Georges Sorel complained already in 1908, though, "many liberties have been taken with this preface, which so many men cite without ever having studied it seriously." Not only had they not "studied it seriously," they did not yet have access to a much longer and more <i>historically specific</i> elaboration of the "fetters on the development of the forces of production" Marx had worked out in unpublished notebooks from 1857 and 1858.</p><p>On page 415 of the 1973 English translation of the <i>Grundrisse, </i>Marx enumerated four contradictions that impose inherent limits to capital, both from the standpoint of accumulation and of development of the forces of production. </p><p></p><blockquote><p>The stages of production which precede capital appear, regarded from its standpoint, as so many fetters upon the productive forces. It itself, however, correctly understood, appears as the condition of the development of the forces of production as long as they require an external spur, which appears at the same time as their bridle. … These necessary limits are:</p><p></p><blockquote><p>(1) <i>Necessary labour</i> as limit on the exchange value of living labour capacity or of the wages of the industrial population;</p><p>(2) <i>Surplus value</i> as limit on surplus labour time; and, in regard to relative surplus labour time, as barrier to the development of the forces of production;</p><p>(3) What is the same, the <i>transformation into money</i>, exchange value as such, as limit of production; or exchange founded on value, or value founded on exchange, as limit of production.</p><p>This is:</p><p>(4) again the same as <i>restriction of the production of use values by exchange value</i>; or that real wealth has to take on a <i>specific</i> form distinct from itself, a form not absolutely identical with it, in order to become an object of production at all.</p></blockquote></blockquote><blockquote><p></p></blockquote><p></p><div>Martin Nicolaus, translator of the 1973 edition, had earlier commented on those limits in his 1968 essay, "The Unknown Marx": </div><p></p><blockquote>While a proper analysis of the implications of these rather cryptic theses would require a book, it is immediately apparent that these four ‘limits’ represent no more than different aspects of the contradiction between ‘forces of production’ and ‘social relations of production’.</blockquote><p>What Nicolaus described as cryptic theses in 56 years ago have become more intelligable over the decades as there have been more studies of Marx that get away from the fetters of the classical Marxist critique. I consider one of the most coherent discussions to be Derek Sayer's <i>Violence of Abstraction,</i> which directly confronted Gerald Cohen's defense of what he called "the old-fashioned historical materialism." </p><p>Huber and Phillips also adhere to what they extol as the classical Marxist critique, which they construe as "Marx’s thesis that socialism would release production from the fetters of capitalism..." They go on to state their view that:</p><p></p><p></p><blockquote>It was elementary for Marxists that at a certain point in the development of the forces of production (basically scientific knowledge, technology, labor, land, and natural resources), they become constrained by the relations of production (the way that production is organized, which under capitalism means, roughly, owners of capital selling commodities on markets for profit and hiring owners of labor power in exchange for wages).</blockquote><p></p><p></p><p>As Sayer pointed out, "[p]roductive forces are... an attribute of human beings in association, their collective capacities, not a set of things as auch at all." Machines are not productive forces. Technologies are not productive forces. Natural resources are not productive forces. Even skillls are not productive forces. They "only become productive forces in so far as they take on social characteristics." To overlook this is, in Sayer's words, to fetishize the notion of productive forces.</p><p>This raises a rather daunting question, if our fetishizing habits of thought lead us to fetishize even the most coherent attempts to cure us of our fetishing habits of thought, how do we escape the dilemma? Marx posed the answer in his third thesis on Feuerbach. Whether it is a satisfactory answer is hard to say.</p><p></p><p></p><blockquote><p></p><p>The materialist doctrine concerning the changing of circumstances and upbringing forgets that circumstances are changed by men and that it is essential to educate the educator himself. This doctrine must, therefore, divide society into two parts, one of which is superior to society.</p><p></p><p>The coincidence of the changing of circumstances and of human activity or self-changing can be conceived and rationally understood only as <i>revolutionary practice</i>.</p></blockquote><p></p><p></p><p>How do Huber and Phillips conceive of revolutionary practice? </p><p></p><blockquote><p>...humanity is already always and everywhere surrounded by natural limits, by constraints on what we can currently do.</p><p>It is science and technology, shackled to egalitarianism (or as midcentury Marxist Hal Draper put it, “Prometheus plus Spartacus”), that allows us to overcome those limits.</p></blockquote><p></p><p><table cellpadding="0" cellspacing="0" class="tr-caption-container" style="float: right;"><tbody><tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgeQJvbajzByl9Lh8wovL1s7pRuhD0o2h9Rx8cXttPdqyqbFcnbwNluNUmB9w-mfH-bAW4o1UdS8rJDddovOarHCh7SfdWAKXGMLB5L8vr8GTLox9n_BHYxwH_dT2knkC1Eg24RNO47mI26Ii4UqmfkNtX7bxOTYDxH835n56XrdnJRAM8UDxhNkzFiJX8e/s3000/cWmTayh.jpeg" imageanchor="1" style="clear: right; margin-bottom: 1em; margin-left: auto; margin-right: auto;"><img border="0" data-original-height="2000" data-original-width="3000" height="213" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgeQJvbajzByl9Lh8wovL1s7pRuhD0o2h9Rx8cXttPdqyqbFcnbwNluNUmB9w-mfH-bAW4o1UdS8rJDddovOarHCh7SfdWAKXGMLB5L8vr8GTLox9n_BHYxwH_dT2knkC1Eg24RNO47mI26Ii4UqmfkNtX7bxOTYDxH835n56XrdnJRAM8UDxhNkzFiJX8e/s320/cWmTayh.jpeg" width="320" /></a></td></tr><tr><td class="tr-caption" style="text-align: center;"><span style="font-size: x-small;">Prometheus Sculpture at Chernobyl</span></td></tr></tbody></table><br />Curiously, Draper did not tether Prometheus to "science and technology" as implied by Huber and Phillips's parenthetical citation. In fact, Draper only mentioned science once and technology not at all. He also stated that "Prometheus scarcely appears again in Marx’s writings..." and elaborated in a footnote that a notable exception is in <i><a href="https://www.marxists.org/archive/marx/works/download/pdf/Poverty-Philosophy.pdf" target="_blank">Poverty of Philosophy</a></i> where Marx ridiculed Proudhon's enlistment of Prometheus to play the part of Robinson Crusoe:</p><p></p><blockquote>First of all, Prometheus emerging from the bosom of nature awakens to life, in a delightful inertia, etc., etc. Prometheus sets to work, and on this first day, the first day of the second creation, Prometheus’ product, that is, his wealth, his wellbeing, is equal to 10. On the second day, Prometheus divides his labour, and his product becomes equal to 100. On the third day and on each of the following days, Prometheus invents machines, discovers new utilities in bodies, new forces in nature.... With every step of his industrial activity, there is an increase in the number of his products, which marks an enhancement of happiness for him. And since, after all, to consume is for him to produce, it is clear that every day’s consumption, using up only the product of the day before, leaves a surplus product for the next day.</blockquote><p>What did Marx have to say about M. Proudhom's Promethean pantomime? </p><p></p><blockquote>This Prometheus of M. Proudhon’s is a queer character, as weak in logic as in political economy. So long as Prometheus merely teaches us the division of labour, the application of machinery, the exploitation of natural forces and scientific power, multiplying the productive forces of men and giving a surplus compared with the produce of labour in isolation, this new Prometheus has the misfortune only of coming too late. But the moment Prometheus starts talking about production and consumption he becomes really ludicrous. ...</blockquote><p>Marx dissected this ludicrousness to Proudhon's pretention that he has "proved by theory and by facts the principle that all labour must have a surplus." To which Marx scoffed in reply, "The 'facts' are the famous progressive calculation; the theory is the myth of Prometheus." </p><p></p><p></p><p></p><p>Huber and Phillips ludicrously make their Promethean myth "more concrete" by invoking the progressive calculation of "science and technology":</p><p></p><blockquote>...one of the Stockholm Resilience Centre’s planetary boundaries is a limit to the amount of greenhouse gas that we can emit, largely as a result of the use of fossil fuels for energy, before causing average global temperatures to exceed those optimal for human flourishing. ... This energetic limit is all too real, but it is also contingent. When we fully shift to clean energy sources such as nuclear, wind, and solar, that climate-related limit on energy use will have been transcended. The only true, permanently insuperable limits that we face are the laws of physics and logic.</blockquote><p></p><p></p><p></p><p>The limit on energy use "will have been transcended" by the "shift to clean energy sources" without any logic as to how that shift will occur or any scrutiny of the laws of physics involved in constructing and operating "nuclear, wind, and solar" production of energy. It is perhaps unfair to compare Huber and Phillips to Proudhon. M. Proudhon didn't have the luxury of being informed by Marx's critique of his Promethean myth and he didn't invoke a "classical Marxist critique" as the foundation for his ludicruous fable. Huber and Phillips don't have that alibi.</p><p>Until now I have been pretty harsh on Huber and Phillips, aside from acknowledging at the outset some worthwhile criticisms of Saito and degrowth. To conclude, I should mention another part of the article I applaud. In a post on X [nee "tweet"], Matt Huber says that his favorite contribution to the article was the line, "Degrowthers consistently misdiagnose the core problem of capitalism as ‘growth’ when in fact it is the lack of social control over production and investment decisions." I agree 100% and cite Marx's almost identical statement from his Inaugural Address to the International Working Men's Association: "social production controlled by social foresight, which forms the political economy of the working class." The first part of that sentence is also noteworthy, so I'll quote the whole passage:</p><blockquote><p><span style="font-family: Georgia, serif;"></span></p>This struggle about the legal restriction of the hours of labour raged the more fiercely since, apart from frightened avarice, it told indeed upon the great contest between the blind rule of the supply and demand laws which form the political economy of the middle class, and social production controlled by social foresight, which forms the political economy of the working class. Hence the Ten Hours’ Bill was not only a great practical success; it was the victory of a principle; it was the first time that in broad daylight the political economy of the middle class succumbed to the political economy of the working class.<br /></blockquote><p>Not only a practical success but the <i>victory of a principle</i>. Not to be overlooked is the context of that victory, the struggle over the restriction of the hours of labour.</p><p>Nearly two years later, in instructions to the delegates to the Internation, Marx wrote, paraphrasing English Factory Inspector, R. J. Saunders, "A preliminary condition, without which all further attempts at improvement and emancipation must prove abortive, is the limitation of the working day."</p><p>If there seems to be a common theme emerging here, consider Marx's argument from volume 3 of <i>Capital</i> that humans must "wrestle with nature to satisfy his wants... in all social formations and under all possible modes of production." Beyond this realm of physical necessity, though, "begins that development of human energy which is an end in itself, the true realm of freedom, which, however, can blossom forth only with this realm of necessity as its basis. The shortening of the working-day is its basic prerequisite."The shortening of the working-day is a basic prerequisite for entering the true realm of freedom. The limitation of the working day is a preliminary condition for all further attempts at improvement and emancipation. The legal restriction of the hours of labour is the victory of the principle of social production controlled by social foresight. I wonder if there is somewhere that Marx explained the analysis behind these self-assured and consistent declarations? He did so in notebook VII of his 1857-58 manuscripts (<i>Grundrisse</i>, 1973, p. 708), which was a continuation and amplification of analysis he had begun in notebook IV (pp. 397-423):</p><p></p><blockquote>The creation of a large quantity of <b>disposable time</b>... appears in the stage of capital, as of all earlier ones, as not-labour time, free time, for a few. What capital adds is that it increases the surplus labour time of the mass by all the means of art and science, because its wealth consists directly in the appropriation of surplus labour time; since value directly its purpose, not use value. It is thus, despite itself, <b>instrumental in creating the means of social disposable time</b>, in order to reduce labour time for the whole society to a diminishing minimum, and thus to free everyone’s time for their own development. But its tendency always, on the one side, to create <b>disposable time</b>, on the other, <b>to convert it into surplus labour</b>. If it succeeds too well at the first, then it suffers from surplus production, and then necessary labour is interrupted, because no <b>surplus labour</b> can be realized by capital. The more this contradiction develops, the more does it become evident that the growth of the forces of production can no longer be bound up with the appropriation of alien <b>surplus labour</b>, but that the mass of workers must themselves appropriate their own surplus labour. Once they have done so - and <b>disposable time</b> thereby ceases to have an antithetical existence - then, on one side, necessary labour time will be measured by the needs of the social individual, and, on the other, the development of the power of social production will grow so rapidly that, even though production is now calculated for the wealth of all, <b>disposable time</b> will grow for all. For real wealth is the developed productive power of all individuals. The measure of wealth is then not any longer, in any way, labour time, but rather <b>disposable time</b>.</blockquote><p>I have bolded the words that appeared in English in Marx's original manuscript. Undoubtedly, the English words allude to the <i>source</i> of Marx's fascination with disposable time and its relationship to surplus value, the 1821 English pamphlet, <i>The Source and Remedy of the National Difficulties.</i>The above passage is the culmination of an analysis that begins in notebook IV with a quotation from <i>The Source and Remedy</i> and concludes in notebook VII with another quotation from <i>The Source and Remedy</i>.</p><p>On page 398 of the <i>Grundrisse</i>, Marx stated, "The whole development of wealth rests on the creation of disposable time." He then commenced a discussion of "the development of the productive forces." On page 708, he echoed that statement about the development of wealth with the proclamation, "The measure of wealth is then not any longer, in any way, labour time, but rather disposable time."</p><p></p><p></p><p>Marx's repeated statements about the limitation of working time being a necessary condition for the realm of human freedom were not humane gesture or concessions to contemporary trade union struggles. They were integral to his critique of political economy and his analysis of capital. Both Saito and Huber and Phillips cite or paraphrase passages where Marx <i>insisted</i> on the reduction of working time but elide specifically that demand.</p><p> </p><p></p><p></p>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com0tag:blogger.com,1999:blog-4900303239154048192.post-26991917081457036112024-01-01T19:44:00.000-05:002024-01-01T19:44:50.751-05:00Lost in translation: Slow Down by Kohei Saito<p>Kohei Saito's "manifesto" of degrowth communism was BIG in Japan, selling half a million copies in the first year and a half after publication. It's debut in English is already tarnished, though, by a colossal, cringe-inducing Celsius to Fahrenheit conversion error that repeats throughout the book.</p><p>The formula for converting Celsius to Fahrenheit is: multiply the Celsius temperature by 1.8 and add 32. The addition of 32 is to account for the fact that the freezing point of water is 0° in Celsius but 32° in Fahrenheit. However, when converting a temperature <i>change, </i>such as the IPCC's upper limit of 1.5° C above preindustrial global annual mean temperature, one <i>doesn't</i> add 32. </p><p>In <i>Slow Down</i>, the 1.5°C limit is rendered as 34.7°F, suggesting that the IPCC thinks we would be O.K. with a global annual mean temperature of slightly above 91°F. My advice to the publisher would be to recall the current print run and pulp it.</p><p>Aside from that massive error, my main criticism of the book is Saito's creation of a "new Marx" by connecting a few scattered dots from Marx's post-<i>Capital</i> notebooks and a letter he wrote to the Russian activist, Vera Zasulach, shortly before his death. Integral to the construction of Saito's "Marxster" is the depiction of Marx's earlier works as "productivist." </p><p>This depiction cedes ground to earlier environmentalist criticisms of Marx and to traditional Marxism as practiced in the Soviet Union but it begs the question of why anyone should care so much about what Marx may have thought late in his life. In Saito's case, it would appear he has a vision of what communism should be and he wants to invoke his creature's redeemed authority. This is unfortunate because the straw man, productivist Marx that Saito scorns actually articulated many of the points that Saito wants to make and did it better than either Saito or his connect-the-dots post-Marx Marx.<br /></p><p>I have already covered some of this material in a previous post, "<a href="https://econospeak.blogspot.com/2023/11/growth-below-zero-and-development-of.html" target="_blank">Growth below zero and the development of the productive forces.</a>" A couple of years ago I wrote a series on <a href="https://econospeak.blogspot.com/2021/12/disposable-time-as-common-pool-resource.html">disposable time as a common-pool resource</a>, which in my view is very relevant to the issues that Saito raises about growth, the commons, and a possible alternative the environmentally destructive imperatives of capital. An even earlier piece, from 2013, <a href="https://econospeak.blogspot.com/2013/03/income-growth-and-double-counting.html">Income, GDP Growth and Double Counting</a> touched on some salient criticisms of growth.</p>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com2tag:blogger.com,1999:blog-4900303239154048192.post-25329075455320592022023-12-24T18:13:00.001-05:002023-12-24T18:13:45.094-05:00In Memoriam: Robert Solow<p> <span> </span><span style="color: inherit; font-family: Aptos, Aptos_EmbeddedFont, Aptos_MSFontService, Calibri, Helvetica, sans-serif; font-size: 12pt; font-style: inherit; font-variant-caps: inherit; font-variant-ligatures: inherit; font-weight: inherit;">One of the tallest trees in the economic forest has fallen: Bob Solow has died at the age of 99.</span></p><blockquote style="background-color: white; color: #242424; font-family: "Segoe UI", "Segoe UI Web (West European)", "Segoe UI", -apple-system, BlinkMacSystemFont, Roboto, "Helvetica Neue", sans-serif; font-size: 15px;" type="cite"><div dir="ltr" style="border: 0px; color: inherit; font: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><div class="x_x_elementToProof" style="border: 0px; font-family: Aptos, Aptos_EmbeddedFont, Aptos_MSFontService, Calibri, Helvetica, sans-serif; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><br aria-hidden="true" /></div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;">The modern study of economic growth could not have happened without his work, of course. He was also one of the funniest economists I know. For years I have had the following quote from him on my office door, which hilariously sums up his attitude to Lucas and Sargent on business cycles:</div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><br aria-hidden="true" /></div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;">"Suppose someone sits down where you are sitting right now and announces to me that he is Napoleon Bonaparte. The last thing I want to do with him is get involved in a technical discussion of cavalry tactics at the battle of Austerlitz. If I do that, I'm getting tacitly drawn into the game that he is Napoleon. Now, Bob Lucas and Tom Sargent like nothing better than to get drawn into technical discussions, because then you have tacitly gone along with their fundamental assumptions; your attention is attracted away from the basic weakness of the whole story. Since I find that fundamental framework ludicrous, I respond by treating it as ludicrous—that is, by laughing at it<span class="x_x__Entity x_x__EType_OWA_HYPHEN x_x__EId_OWA_HYPHEN x_x__EReadonly_1" style="border: 0px; color: inherit; display: inline-block; font: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><span class="x_x_hyphen" id="x_x_hyphen1" style="border: 0px; color: inherit; font: inherit; margin: 0px; padding: 0px; vertical-align: baseline;">—</span></span>so as not to fall into the trap of taking it seriously and passing on to matters of technique."</div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><br aria-hidden="true" /></div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;">RIP, Robert Solow</div><div class="x_x_elementToProof" style="border: 0px; font-feature-settings: inherit; font-kerning: inherit; font-optical-sizing: inherit; font-size: 12pt; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-variation-settings: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;"><br aria-hidden="true" /></div></div></div></blockquote>kevin quinnhttp://www.blogger.com/profile/04880872194080353414noreply@blogger.com2tag:blogger.com,1999:blog-4900303239154048192.post-33061668752036679452023-12-04T22:41:00.007-05:002023-12-05T00:01:22.492-05:00Seeing the frowns on the jugglers and the clowns<p>It is a problem that has vexed and eluded Marxists -- and tantalized critics of Marx -- for a century and a half. If I am correct, Karl Marx had an intuition of the argument I am about to present but he couldn't quite bring himself to articulate it. A bit over a century later, in "Proletariat and Middle Class in Marx: Hegelian Choreography and the Capitalist Dialectic." Martin Nicolaus <i>almost</i> got it or may have gotten it but couldn't put it into words. The question is usually framed in terms of a New Middle Class, although the agglomeration isn't a class, it isn't in the middle, and it isn't particularly new. For background on the debates about this so-called new middle class, see Val Burris's 1986 review article, "The Discovery of the New Middle Class" in <i>Theory and Society</i>, Vol. 15, No. 3 (May, 1986), pp. 317-349.</p><p>Burris mentioned Nicolaus's essay in connection with the argument that "Marx was actually an advocate, if not the originator, of the concept of a 'new middle class.'" That hardly does justice to Nicolaus's contribution. Abram Harris had traced the concept to Marx in 1939. Nicolaus's argument was a much more complex one having to do with Marx abandoning certain Hegelian preconceptions in the face of empirical evidence. I won't summarize Nicolaus's entire argument here but focus on two pieces of evidence he presents in his essay. The first is a footnote from the <i>Grundrisse</i> in which Marx wrote, "the creation of surplus labor on one side corresponds to the creation of minus-labor, relative idleness (or non-productive labor at best) on the other." </p><p>The second is a parenthetical commentary from <i>Theories of Surplus Value</i> 1 in which Marx speculated about an advance of productivity such that <i>"</i>whereas earlier two-thirds of the population were directly engaged in material production, now it is only one-third." If the produce and productive labour time were equally distributed, everyone would have more free time and time for "unproductive labor," presumably of their choice. But that could never happen under capitalism. As Nicolaus explained, "[t]he contradiction resides in the fact that the distribution of disposable time cannot be equal so long as the capitalist system operates by appropriating surplus labor."</p><p>At the end of his <i>Theories of Surplus Value</i> commentary on the consequences of productivity, Marx supposed that, </p><p></p><blockquote>—with the exception of the horde of flunkeys, the soldiers, sailors, police, lower officials and so on, mistresses, grooms, clowns and jugglers—these unproductive labourers will on the whole have a higher level of culture than the unproductive workers had previously, and in particular that ill-paid artists, musicians, lawyers, physicians, scholars, schoolmasters, inventors, etc., will also have increased in number.<p></p></blockquote><p></p><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgAiqdX7biDCMsPo8vj3lzPlpkNnSev0GGUl92dW0P1K0wtpXjnGKIZ2hGdyNMBvz5pfcBFOLqD63MHRncnm9_z3GKDrUT2GyVTbkuo9-XK6ca1zKJH6eqz4Fcnig2fj9AqeO37z5G0Hd3Tc6sJ0MB44HaqpRLzOGg9VYdIpY9UWbTMwfYYNDYEKknpgVEH/s1394/Family_of_Saltimbanques.jpg" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" data-original-height="1279" data-original-width="1394" height="294" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgAiqdX7biDCMsPo8vj3lzPlpkNnSev0GGUl92dW0P1K0wtpXjnGKIZ2hGdyNMBvz5pfcBFOLqD63MHRncnm9_z3GKDrUT2GyVTbkuo9-XK6ca1zKJH6eqz4Fcnig2fj9AqeO37z5G0Hd3Tc6sJ0MB44HaqpRLzOGg9VYdIpY9UWbTMwfYYNDYEKknpgVEH/s320/Family_of_Saltimbanques.jpg" width="320" /></a></div>I personally don't see why the clowns and jugglers wouldn't also have a higher level of culture, hence their frowns. But I take the point of Marx's listing of occupations to be precisely the <i>heterogeneity</i> of the unproductive workers who live on redirected revenue. This variety of occupations is in contrast to the footnote from the <i>Grundrisse</i>, in which Marx had enumerated, "the paupers, flunkeys, lickspittles etc. living from the surplus product, in short, the whole train of retainers; the part of the servant [<i>dienenden</i>] class which lives not from capital but from revenue." <p></p><p>Incidentally, that footnote began with the disclaimer "[i]t does not belong here..." "Does not belong here" is a frequent occurence in the <i>Grundrisse,</i> appearing 17 times in that form. Sometimes Marx was referring to an anachronism. Sometimes he may have felt that a stray thought belongs in a different section than the one he is currently writing. But it seems to me that in this case "it does not belong here" referred to an idea that he did not know what to say about it. The footnote contains what appear to be several <i>non-sequiturs</i> but they are only such because Marx failed to develop the connections:</p><p></p><blockquote>It does not belong here, but can already be recalled here, that the creation of surplus labour on the one side corresponds to the creation of minus-labour, relative idleness (or <i>not-productive</i> labour at best), on the other. This goes without saying as regards capital itself; but holds then also for the classes with which it shares; hence of the paupers, flunkeys, lickspittles etc. living from the surplus product, in short, the whole train of retainers; the part of the <i>servant</i> [<i>dienenden</i>] class which lives not from capital but from revenue. Essential difference between this servant class and the <i>working</i> class. In relation to the whole of society, the creation of <i>disposable time</i> is then also creation of time for the production of science, art etc. The course of social development is by no means that because one individual has satisfied his need he then proceeds to create a superfluity for himself; but rather because one individual or class of individuals is forced to work more than required for the satisfaction of its need - because <i>surplus labour</i> is on one side, therefore not-labour and surplus wealth are posited on the other. In reality the development of wealth exists only in these opposites [<i>Gegensatze</i>]: in potentiality, its development is the possibility of the suspension of these opposites. Or because an individual can satisfy <i>his own</i> need only by simultaneously satisfying the need of and providing a surplus above that for <i>another </i>individual. This brutal under slavery. Only under the conditions of wage labour does it lead to <i>industry, industrial</i> labour. - Malthus therefore quite consistent when, along with surplus labour and surplus capital, he raises the demand for surplus idlers, consuming without producing, or the necessity of waste, luxury, lavish spending etc.</blockquote><p></p><p>On the one hand it is a jumble, on the other it is an extremely compressed summary of the theory Marx is developing. Right at the centre of that theory is disposable time: "In relation to the whole of society, the creation of <i>disposable time</i> is then also time for the production of science, art, etc." Recall Nicolaus's observation that under capitalism "the distribution of disposable time cannot be equal." That is both a law of capital accumulation and a fundamental contradiction of capitalism.</p><p>The pamphlet that inspired Marx's affection for disposable time, <i>The Source and Remedy of the National Difficulties</i>, contains a multi-page polemic against the proliferation of the "unproductive classes" in answer to the question, </p><p></p><blockquote>Why then is it that no existing society, nor society that ever had existence, has arrived at this point of time, considering that in all times, and in all societies, excepting only the very barbarous, a few years would naturally have led to it? </blockquote>"It" being "that real national prosperity, when men would no more labour, <p></p><blockquote>'than sufficed<br />To recommend cool zephyr, and make ease<div>More easy, wholesome thirst and appetite<br />More grateful;'"</div></blockquote><div><p>In his polemic, C. W. Dilke, the author of the pamphlet cited "all soldiers, sailors, parsons, lawyers, counsellors, judges, and innumerable other persons," as representative of the unproductive classes. Was Marx influenced by this opposition between disposable time and unproductive labour in <i>The Source and Remedy</i>? Consider that the does-not-belong footnote came at the end of a passage that began with a quote from <i>The Source and Remedy:</i></p><p></p><blockquote>With the development of the forces of production, necessary labour time decreases and surplus labour time thereby increases. Or, as well, that one individual can work for 2 etc. (‘<i>Wealth is disposable</i> time and nothing more. ... If the whole labour of a country were sufficient only to raise the support of the whole population, there would be no <i>surplus labour</i>, consequently nothing that can be allowed to accumulate as capital . . .')</blockquote><p>Marx subtly modified the pamphlet's maxim about wealth: "The whole development of wealth rests on the creation of disposable time." For Marx, disposable time became not merely the product of surplus labour but also its origin. Where Dilke had written of only an opposition between unproductive labour and the realization of disposable time, Marx, the dialectician, detected a unity.</p><p>Could it be, though, that this unity was already implicated in Dilke's term "disposable time"? At the end of his "does not belong here" footnote, Marx cited Malthus and acknowledged the consistency of his "demand for surplus idlers, consuming without producing." In notebook VI Marx quoted Thomas Chalmers, "one of the most fanatic Malthusians," writing that profit " has the effect of attaching the services of the disposable population to other masters, besides the mere landed proprietors." The quote is from Chalmers's <i>On Political Economy: In Connexion with the Moral State and Moral Prospects </i>published in 1832, but Chalmers had discussed and extolled the "<a href="https://econospeak.blogspot.com/2021/03/disposable-people.html" target="_blank">disposable population</a>" at length in his 1808 <i>Inquiry</i> <i>into the Extent and Stability of National Resources.</i>The latter book contains a chapter "On the distinction between productive and unproductive labour," which objects at length to the "mischief" done by the definition of unproductive labour.</p><p>Is it possible that Dilke chose the term "disposable time" -- as opposed to the more prosaic "leisure" -- as a veiled rebuttal to Chalmers's "disposable population"? The possibility is amplified by Dilke's attachment to William Godwin's philosophy and Chambers's (and Malthus's) open hostility toward Godwin.</p><p>We are by no means finished...</p><p></p><div class="separator" style="clear: both; text-align: center;"><iframe allowfullscreen="" class="BLOG_video_class" height="266" src="https://www.youtube.com/embed/a6Kv0vF41Bc" width="320" youtube-src-id="a6Kv0vF41Bc"></iframe></div><p></p><p></p><p></p><blockquote><p>Still, we are by no means finished. The contradiction between production and realization - of which capital, by its concept, is the unity - has to be grasped more intrinsically than merely as the indifferent, seemingly reciprocally independent appearance of the individual moments of the process, or rather of the totality of processes.</p></blockquote><p>Immediately following Marx's "does not belong here" footnote in the <i>Grundrisse</i> begins a 22-page section that examines the "transition from the process of the production of capital into the process of circulation." The climax of the section is the four point summary of the fundamental contradictions that I mentioned in a <a href="https://econospeak.blogspot.com/2023/11/growth-below-zero-and-development-of.html" target="_blank">previous post</a> and that culminates in the "fetter" that “real wealth has to take on a specific form distinct from itself, a form not absolutely identical with it order to become an object of production at all." One might be tempted to conclude that it is precisely those barriers that arise during the transition from production to circulation that necessitate the increase in unproductive workers as consumers of the revenues from surplus labour. As Malthus pointed out, at the end of a long quotation by Marx, "The very existence of a profit upon any commodity presupposes <i>a demand exterior to that of the labourer who has produced it</i>." Did Marx offer direct analysis of the relationship between the fetters on the development of productive forces and the expansion of unproductive labour? Only negatively: by explicitly "omit[ting] here any regard for the other possessing and consuming etc. classes, which do not produce but live from their revenue..." </p><p>Summing up, then, productive labour, which produces surplus value, thereby also produces unproductive labour as both an external demand for the products of industry and as a conduit for the revenues of capital that are not reinvested: "the creation of surplus labour on the one side corresponds to the creation of minus-labour, relative idleness (or not-productive labour at best), on the other." First, the wages of productive labour are limited because otherwise there would be no incentive for capital to invest: "the existence of necessary labour time is conditional on the creation of superfluous labour time." </p><p>Second, the amount of surplus value that can be re-invested is limited by consumption, which can not grow as fast as productivity could grow if all profits were reinvested. Economists' favorite maxim that "human wants are insatiable" is false. Wants can expand over time but at any given moment they are limited by taste, habit, and custom. The capitalist production process is driven by the production of exchange values and only incidentally produces use-values. But for that exchange value to be realized, the commodities produced must also be use-values for someone with the means to purchase them. Besides, if too much capital is taken out of circulation for re-investment, then not enough will be available in circulation for the purchase of the goods produced.</p><p>Finally, <i>real wealth</i> is distinct from the commodities that are produced. It must "take on a specific form, distinct from itself... to become an object of production at all." What might that imply for Dilke's statement that "wealth is disposable time"? For the capitalist, disposable time comes in the form of servants that improve the quality of their quantitatively finite free time. For all with disposable income, disposable time is produced in the form of time-saving "conveniences" ranging from automobiles to household appliances to communications devices, all of which began as luxuries and evolved into necessities. Whether they live up to their billing as time savers is questionable, though, if they are subjected to full cost accounting. For example, "free parking" is anything but and the cost of housing is escalated by zoning requirements to provide parking spots for each unit. Not to mention the huge environmental "externalities" of the automobile. Given a choice between working eight fewer hours per week or working the eight more to earn enough money to buy devices that save six hours per week, how many people could even find the information to make the comparison, wrapped as it is in regulations, taxes, urban development and a thousand other roundabouts?</p><p>Funny, people spend all kinds of time trying to figure out the meaning of the lyrics to <i>Like a Rolling Stone</i> (for example) but are incurious when it comes to what happens to their own free time. "You never turned around to see the frowns on the jugglers and the clowns" is 14 words and gets 23 results in Google Scholar, 100 times that many on Google. "Surplus labour on the one side corresponds to the creation of minus-labour" is 13 words and gets 6 results on Google Scholar, "about 10" on Google. Sure, the comparison is arbitrary and invidious. Karl Marx was no Bob Dylan. </p><p><br /></p><p></p></div>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com2tag:blogger.com,1999:blog-4900303239154048192.post-82957665474406425122023-11-17T22:18:00.003-05:002023-11-18T22:12:29.276-05:00Growth below zero and the development of the productive forces<div>Was Karl Marx a “degrowth communist” as Kohei Saito claims in <i>Marx in the Anthropocene</i>? In a word, no. But the whole truth is even stranger and more wonderful than Kohei Saito’s oxymoron anachronism.</div><div><br /></div><div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhzsuySSlwqDMb7uvuGnhY-7SvgzlZUls8SQcPCo_4uenKu8xpFtwajGbFDwdpTY3TwB5iDvLgsRZg5vHbfUrW59fdsgTnYyu-rsa78f005jqt5sRX29M5cyjoZUGz5i8LDDw9hd-OWizRNwp1TiCIcDRpL0HpgCxEuX3No6AhWTVBHYXvop_3FLqxeY7mt/s480/observateur.jpg" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"><img border="0" data-original-height="480" data-original-width="349" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhzsuySSlwqDMb7uvuGnhY-7SvgzlZUls8SQcPCo_4uenKu8xpFtwajGbFDwdpTY3TwB5iDvLgsRZg5vHbfUrW59fdsgTnYyu-rsa78f005jqt5sRX29M5cyjoZUGz5i8LDDw9hd-OWizRNwp1TiCIcDRpL0HpgCxEuX3No6AhWTVBHYXvop_3FLqxeY7mt/s320/observateur.jpg" width="233" /></a></div>André Gorz is credited with the first use of <i>la décroissance</i> (degrowth) in the context of modern criticism of the political imperative of economic growth. The occasion was a public forum held in Paris by <i>Le Nouvel Observateur</i> on June 13, 1972 to discuss the Club of Rome’s Limits to Growth report. Gorz’s remarks were largely a reply to a speech and interview given by European Commission President, Sicco Mansholt.</div><br /><div><br /></div><div>In the interview, Mansholt had called for “growth below zero” and the end of wasteful and environmentally destructive consumer society. Gorz acknowledged the compatibility of Mansholt’s vision with socialism and even, “better, with communism as it was understood in the last century. … In short, an economy ruled not by the law of value but by the slogan: to each according to his needs.” He objected, however to the absence of any discussion of a method for achieving such a post-industrial civilization. “With few exceptions.” Gopz complained, “ecologists and ecological movements are silent on the subject of means.”</div><div><br /></div><div>Such silence was not innocent in Gorz’s view because without a clearly defined alternative, implementation would, by default, have to “rely on the moral conversion of the custodians of big capital, and enlightened intervention by national and international state bureaucracies, to bring about a post-industrial and post-capitalist civilisation.”</div><div><br /></div><div>Gorz’s own strategy, up to that time, relied on the traditional Marxist expectation of a revolutionary working class, albeit a working class weaned from the distractions of the affluent society, planned obsolescence, and an enervating culture industry. His <i>Strategie ouvriere et neocapitalisme</i> (1964) had stressed anti-consumerist themes from Herbert Marcuse, John Kenneth Galbraith, and Vance Packard. It would be another eight years before he would bid <i>Adieu au Proletariat</i> and go in pursuit of a new subject of history, namely a “non-class of non workers” whose goal is the abolition of work and the expansion of a “sphere of autonomy” outside the heteronomous activity of waged work.</div><div><br /></div><div>Saito quotes approvingly from the English translation of a republication of the postscript to <i>Adieu</i>, originally titled « <i>Croissance destructive et décroissance productive</i> »,</div><div><blockquote>…the development of [the] productive forces within the framework of capitalism will never lead to the gate[s] of Communism, since the technologies, the relations of production and the nature of the products exclude not just the durable, equitable satisfaction of needs but also the stabilization of social production at a level commonly accepted as sufficient.</blockquote></div><div>Saito quoted Gorz in support of his thesis that Marx’s “productive forces” or “forces of production” belong to a Promethean, “productivist” perspective that Marx abandoned after 1860 and that had tainted his analysis in the <i>Grundrisse</i>. However, in both <i>Adieu au Proletariat</i> and <i>Strategie ouvriere et neocapitalisme</i>, as well as in much of his subsequent writing, Gorz relied heavily on the <i>Grundrisse</i> in formulating his unconventional views.</div><div><br /></div><div>Gorz shared with Saito – as well as Lenin, G.A. Cohen, Eric Hobsbawn, and just about every other Marxist -- an interpretation of productive forces derived from Marx’s 1859 preface to<i> A Contribution to the Critique of Political Economy</i>:</div><div><blockquote>At a certain stage of development, the material productive forces of society come into conflict with the existing relations of production or – this merely expresses the same thing in legal terms – with the property relations within the framework of which they have operated hitherto. From forms of development of the productive forces these relations turn into their fetters. Then begins an era of social revolution.</blockquote></div><div>In quoting this famous passage, Saito overlooked the introduction to it, which clearly stated this was a “general conclusion at which I arrived [during his time in Paris and Brussels in the 1840s] and which, once reached, became the guiding principle of my studies.” In other words, it was not meant to be a summary of the results of those studies, which continued through the next decade and included the <i>Grundrisse</i>.</div><div><br /></div><div><div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEirXN-e7h9zVAaRP3FtMTEB3JisbGTAbGUA5MAv44UkKv0zpt60ikDEkwI_c5CmpUSE6O21kufJfGNNCqwiPY0cHgXfig56q-FWmGLgPe_AmPc_jDNWpiivVcAdSs99NfYuayQYb3TdPJh7MPeLzmorsYJs_NWMHlv2lsvnLn5TKQXq9UMaTECqXeeYkdeA/s3000/unknown%20marx.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" data-original-height="3000" data-original-width="2342" height="320" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEirXN-e7h9zVAaRP3FtMTEB3JisbGTAbGUA5MAv44UkKv0zpt60ikDEkwI_c5CmpUSE6O21kufJfGNNCqwiPY0cHgXfig56q-FWmGLgPe_AmPc_jDNWpiivVcAdSs99NfYuayQYb3TdPJh7MPeLzmorsYJs_NWMHlv2lsvnLn5TKQXq9UMaTECqXeeYkdeA/s320/unknown%20marx.jpg" width="250" /></a></div>Here is where the story of those productive forces starts to get strange. Martin Nicolaus, a Simon Fraser University grad student and lecturer who had co-translated Gorz’s <i>Strategie ouvriere et neocapitalisme</i> in 1967, wrote a highly acclaimed article the following year, “The Unknown Marx,” in which he discussed the much more detailed and, more importantly, <i>historically specific</i> account of productive forces that appeared in the <i>Grundrisse</i>. The essay, published in the <i>New Left Review</i>, won the first Deutscher memorial prize. Nicolaus subsequently translated the <i>Grundrisse</i> into English.</div><br /><div><br /></div><div>In his NLR essay, Nicolaus explained that the dichotomy between forces and relations of production in the preface was developed in the <i>Grundrisse</i> as the dichotomy between “two distinct processes which Marx identifies as basic to capitalist production.” It is also the <i>unity</i> of those two distince processes of production and circulation that is basic to capitalist production.</div><div><br /></div><div>In a section that began three-quarters of the way through his essay, “The Road to Revolution,” Nicolaus revealed what are the famous “fetters” on the development of the productive forces. Or rather he quoted Marx’s enumeration of those fetters. Capital, Marx argued, “appears as the condition of the development of the forces of production as long as they require an external spur, which appears at the same time as their bridle.”</div><div></div><blockquote><div>It is a discipline over them, which becomes superfluous and burdensome at a certain level of their development, just like the guilds etc. These inherent limits have to coincide with the nature of capital, with the essential character of its very concept. These necessary limits are:</div><div>(1) Necessary labour as limit on the exchange value of living labour capacity or of the wages of the industrial population;</div><div>(2) Surplus value as limit on surplus labour time; and, in regard to relative surplus labour time, as barrier to the development of the forces of production;</div><div>(3) What is the same, the transformation into money, exchange value as such, as limit of production; or exchange founded on value, or value founded on exchange, as limit of production.</div><div>This is: (4) again the same as restriction of the production of use values by exchange value; or that real wealth has to take on a specific form distinct from itself, a form not absolutely identical with it, in order to become an object of production at all.</div></blockquote><div></div><div>This short excerpt hardly does justice to an argument that Marx developed over the course of 26 pages and then returned to in the (in)famous “Fragment on Machines.” But the final clause is crucial to questions of ecology and social justice. Under capitalism, “real wealth has to take on a specific form distinct from itself, a form not absolutely identical with it order to become an object of production at all.” The commodity is that form not identical with wealth. Marx had a lot more to say in the <i>Grundrisse</i> about productive forces that is very different from the conventional reading based on the 1859 preface. Relying exclusively on the latter is like writing a high school book report based on the dust jacket blurbs.</div><div><br /></div><div>While Saito construes the productive forces as technology, albeit in its broadest sense, Marx conceived the development of the productive forces as “the development of the social individual which appears as the great foundation stone of production and of wealth.” Marx reiterates this point in a section labelled “true conception of the process of social production”:</div><div><blockquote>When we consider bourgeois society in the long view and as a whole, then the final result of the process of social production always appears as the society itself, i.e. the human being itself in its social relations. Everything that has a fixed form, such as the product etc., appears as merely a moment, a vanishing moment, in this movement. The direct production process itself here appears only as a moment. The conditions and objectifications of the process are themselves equally moments of it, and its only subjects are the individuals, but individuals in mutual relationships, which they equally reproduce and produce anew. The constant process of their own movement, in which they renew themselves even as they renew the world of wealth they create.</blockquote></div><div>This essay began with a recap of the circumstances of André Gorz’s use of <i>la décroissance</i> and his objection to the absence of means or a “revolutionary subject” in scenarios for a “growth below zero” future. Saito’s rejection of productive forces implies that Marx abandoned his theory of historical change and consequently turned his back on communism. If he did, Marx couldn’t have been a “degrowth communist.”</div><div><br /></div><div>The question of what a <i>Grundisse</i>-based analysis of productive forces might contribute to human emancipation and ecological survival would take a book. I am working on it.</div><div><br /></div>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com1tag:blogger.com,1999:blog-4900303239154048192.post-80614302360415651882023-05-30T10:12:00.001-04:002023-05-30T10:12:22.619-04:00Only DA Willis Can Save Us<p> Imagine: </p><p>Trump convicted of federal crimes by Jack Smith, sentenced to prison and imprisoned during 2024 election cycle, wins election and proceeds to pardon himself. The Supine Court upholds his self-pardon, Thomas writing for the majority.</p><p><br /></p><p>Are you sufficiently scared? To forestall this, he must be convicted of serious felonies at the state level: a president's power to pardon only bears on federal crimes. </p><p><br /></p><p>Hence my title: Godspeed, Fani Willis!!</p>kevin quinnhttp://www.blogger.com/profile/04880872194080353414noreply@blogger.com6tag:blogger.com,1999:blog-4900303239154048192.post-83636457918479081602023-05-05T09:58:00.001-04:002023-05-05T09:58:12.712-04:00Peter Pan to the rescue<p> I'm more and more convinced that the simplest way out of the debt-ceiling morass would be to start issuing perpetual bonds or consols (sometimes dubbed "Peter-Pan" bonds, since they never mature or grow up )which simply offer a fixed payment every year, with no face value. This would seem to be immune to court challenges -- unlike the constitutional gambit or the platinum coin. The Republicans in the House are manifestly crazy, so there's no hope there.</p><p>One question is how much bigger the term premium would be to borrow longer term in this way.</p>kevin quinnhttp://www.blogger.com/profile/04880872194080353414noreply@blogger.com9tag:blogger.com,1999:blog-4900303239154048192.post-34346803913779630372023-03-14T14:17:00.000-04:002023-03-14T14:17:16.000-04:00Escape from Muddle Land<p>Let’s get the up-or-down part of this review over with quickly: <i>Escape from Model Land: How Mathematical Models Can Lead Us Astray and What We Can Do About It</i> by Erica Thompson is a poorly written, mostly vacuous rumination on mathematical modeling, and you would do well to ignore it.</p><p>Now that that’s done, we can get on with the interesting aspect of this book, its adaptation of trendy radical subjectivism for the world of modeling and empirical analysis. The framework I’m referring to goes something like this: Each of us exists in our own bubble, a product of our experiences and perspectives. Our thoughts express this subjective world, and they are true in relation to it but false beyond its boundaries. This means no one has the right to speak for nor criticize anyone else. In some versions, bubbles can be shared among people with the same set of identities, but, as before, not across them. In some unspecified way, we will be happy and productive if we embrace the diversity of our incommensurable worlds and their corresponding truths. Oppression occurs when some privileged people think their bubbles are universal, the doctrine of false objectivity. We must be re-educated out of such a delusion.</p><p>This of course is a cartoon version, but I think it expresses the core of the cognitive bubble framework. Its adherents think it is very radical and liberating, and self-evidently correct. I won’t belabor the obvious contradiction between the no-objective-criteria-across-bubbles hypothesis and the claim that the cognitive bubble world is the one we all live in. The only other point I’ll make is that, true to their belief that each cognitive world is impervious to criticism from another, adherents never, and I mean never, acknowledge, much less grapple with, serious criticism of their worldview. Instead, they argue by authority: Author X, who is much admired by people like us, says thusly, and so we can use this insight as a basis for further analysis. “Argument” in this context tends to take the form of exemplary analogy: here is a good way to think about the topic at hand because something like it works in a situation that is analogous to it in some respects. Argument by analogy fits a subjectivist framework, since its salience derives from aha-ness, not the sort of reasoning or empirical evidence that depend on objective criteria.</p><p>So how can this framework be extended to the world of information sciences and mathematical modeling? Thompson’s insight is that each model can be thought of as existing within its own cognitive bubble, composed of the assumptions that structure it and the purposes it’s designed to serve. Each model is true within its own bubble, but we need to step outside them, into the world of social and cognitive diversity, to see their limitations and escape their claims to any broader truth or objectivity. And that’s sort of it. While (as you can see) Thompson didn’t persuade me of any of this, I think there’s a chance her book will be successful on its own terms: future writers of the radical subjectivist persuasion may cite her as the reason why we should all think about models in this way.</p><p>My own view is probably clear from the way I describe hers, but just to be complete, here is its own cartoon version: There really are better and worse models, based on criteria that apply across different social and intellectual divides. Our self-knowledge is imperfect, and others often understand things about us we don’t see. We benefit from their criticism. They can also represent us, sometimes better and sometimes worse than we would represent ourselves. Arguments that evade engagement with counterargument are generally weak and unreliable. Arguments based on reasoning and evidence are better than those based on some version of grokking, and those are the criteria we’ll need to use if we’re serious about positive social change. How much we share with one another, cognitively and otherwise, is not a matter for <i>ex cathedra</i> generalizations; it’s something we discover through interacting with others—or better, something we can create by building on what already connects us.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com4tag:blogger.com,1999:blog-4900303239154048192.post-14662470836524747722023-03-12T01:13:00.010-05:002023-03-12T18:24:17.166-04:00Economic Insomnia? A Review of "The Guest Lecture" by Martin Riker.<p>It’s a rare day when an economist plays the key role in a novel, and even rarer when one of the supporting players is John Maynard Keynes himself. So, spurred on by enthusiastic reviews, I sailed through Martin Riker’s The Guest Lecture this week, a novel in which a woman, just denied tenure by the all-male economics department at her university, lies awake at night in a hotel room, rehearsing a lecture she’ll be giving the next day while re-evaluating the twists and turns of her life’s trajectory. Maybe it’s a risk to read insomnia fiction at bedtime, but I definitely enjoyed myself, laughing out loud several times and rereading especially zingy paragraphs.</p><p>Yet I was disappointed, and I’ll use this post to explore how and why. The first part of the disappointment is obvious and straightforward: this is supposed to be an expression of the inner thoughts of an economist, but it shows close to zero understanding of the world of academic economics. Yes, there is some name-dropping, and yes the great Keynes shows up to guide Abby, the unsleeping economist, through her long night of the Deep CV. Superficially it’s all there; in substance not.</p><p>First, why is Abby an economist? Where does she fit in that world? The only explanation we’re given is that she found herself to be “good at math”, and she took a course in experimental economics as an undergrad from a female professor who served as a role model. Well, OK, that may be part of it, but did she think that being an economist would be a way to change the world for the better, or to understand a complex and puzzling aspect of it, or what? Other than the paycheck, what did she think she would be getting? Without that piece, it’s difficult to relate her deep struggles of self-meaning to her career crisis.</p><p>Second, so what did she write her dissertation on? The novel parades scenes from her academic coming of age—her undergrad course with her mentor, following her to grad school, her departure from the expected path of a junior professor when she wrote about about Keynes and the rhetoric of economics a few years in—but there is a blank space in between where the core formation-of-an-economist ought to be. Grad school in econ is very demanding and, except for a few renegade departments, strongly pushes a market-centered view of the world; how did that go down with Abby? And a dissertation is the culmination of this process, where the economist-to-be both draws on and finds breathing room from the methodological onslaught to which they’ve been subjected. This is a very big gap in the record.</p><p>Third, while Martin Riker is an academic himself (with a degree in English, no surprise), he misunderstands the tenure expectations for junior faculty to a degree that Abby wouldn’t. We’re told she was hired by an R1(ish) research university, where it’s considered enough to publish one article a year in second-tier journals. No way! Six articles won’t get you tenure unless, just perhaps, most are in top-ranked outlets (AER, QJE, etc.). Moreover, books don’t count. Economists regard book-writing as a sort of indulgence, best saved until the choice morsels of science have been parceled out in article form. The Journal of Economic Literature, the main review outlet in the profession, has steadily reduced the number of books for which it publishes reviews; the latest quarterly issue reviewed just two books. I’m sure many economists make an entire career in the field without reading a single economics book post grad school.</p><p>And, to get tenure at an R1, the candidate’s research has to use formal modeling, either theoretical (as in game theory) or empirical (econometrics). There is no ambiguity about this. If Abby spends half her tenure period on a book without a single equation, she should be looking for another job sooner rather than later. I’m not saying this is justified—quite the contrary—but it’s central to the culture of the discipline. Making it all seem like an unexpected shock and personal crisis when Abby is denied tenure leaves someone like me wondering whether she had much reality contact all along.</p><p>Finally, there just isn’t any economics thinking of any sort in Abby’s nighttime ruminations. She is steeped in rhetoric, its history and current relationship to philosophy and critical theory, but no thoughts from the economic realm arise to make sense of her predicament. For instance, she thinks a lot about ideology, but economists for whom this concept matters use it to connect belief systems to social structures and the incentives they produce; they think of ideological beliefs as in the economy, not as forces lying outside it. On a couple of occasions, in listing the horrors of the modern world, Abby mentions the menace of “endless growth”, a term that has entered the canon of at least part of the left, but rubs nearly all economists, including those on the left end of the spectrum, the wrong way. Economists inclined to criticize capitalism usually see it as a system that places the gain of the few ahead of the well-being of the many, an important part of which is the repeated demand of the rich for tight money and austerity—not growth. (The classic statement of this position is by Michael Kalecki in 1943, “Political Aspects of Full Employment”. This may be the most cited paper by a left wing economist, ever.) Obviously, anyone who admired Keynes would be reluctant to criticize economic growth in a general way. Even the word “endless” would annoy economists who think of the world as a tangle of differential equations, not as a rigid arrow forever trending in the same direction. To be blunt: a mindless reference to the evils of “endless” economic growth, to an economist, simply looks like ignorance.</p><p>Even putting aside all those complaints, I didn’t see anything illuminating about Abby’s analysis of Keynes’ essay on the “Economic Possibilities for our Grandchildren”. Of course, the value of this essay doesn’t depend on whether the people of today, or those of 100 years from now, inhabit a world in which economic necessity has disappeared. I’ve heard many discussions of it, and none of them have been about its timing. So what is Abby adding to the mix? Maybe it’s just me, but I couldn’t find anything new.</p><p>Granted, it’s not easy making an economist, much less an economist’s nighttime brain, an engaging subject for fiction. I’m not saying Riker’s job was easy, only that I wish it had actually given us someone with human depth and complexity who also manages to be an economist. With few exceptions, novels on academic themes are about literature professors; there’s an obvious reason for that. I’ve enjoyed them, but I was hoping for something different this time, and not a lit prof who wandered into the economics department by accident.</p><p>ps: One more thought occurred to me. In the book, Abby is concerned that her insight about Keynes and rhetoric was anticipated by Deirdre McCloskey, although she (Abby) came to it independently. This greatly understates the importance of what McCloskey did. It is no great insight that Keynes, the author of <i>Essays in Persuasion</i>, was a rhetorician. Showing that would make no one’s career. What McCloskey argued, however, is not just that the language of economics follows rhetorical tropes, but that the <i>math</i> does too. This is an immensely important point. To establish, apply or simply argue in parallel with it, you have to deconstruct the architecture of modeling in theoretical and empirical economics. A great example of this is the joint work of McCloskey and Ziliak on statistical significance as rhetoric (and its corresponding scientific shortcomings). If Abby is on the same plane, she should be writing and talking about the role of “mathiness” in economics, not on the rhetorical status of a narrative essay. Maybe you need to have actually grappled with mathematical models in order to appreciate what this entails.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com10tag:blogger.com,1999:blog-4900303239154048192.post-61816461980050320572023-02-07T14:41:00.000-05:002023-02-07T14:41:55.214-05:00This Is What Happens When Progressives Look the Other Way<p>Recent events in Florida—the “Stop WOKE” Act, the rejection of AP African American Studies, the hostile takeover of New College—and the publication of an <a href="https://www.chronicle.com/article/yes-dei-can-erode-academic-freedom-lets-not-pretend-otherwise?utm_source=Iterable&utm_medium=email&utm_campaign=campaign_6116523_nl_Academe-Today_date_20230207&cid=at&source=ams&sourceid=&cid2=gen_login_refresh">excellent op-ed</a> about Diversity, Equity and Inclusion (DEI) in the Chronicle of Higher Education have me returning to a topic I blogged on several years ago, but in a new light.</p><p>It was obvious, and I mean Emperor’s New Clothes obvious, right from the outset that DEI ideology was predicated on the flimsiest of foundations. The <a href="http://econospeak.blogspot.com/2016/10/the-problem-with-privilege.html">confusion of inequality and privilege</a>, the epistemological mess known as <a href="https://econospeak.blogspot.com/2016/11/taking-stand-on-standpoint.html">standpoint</a> <a href="https://econospeak.blogspot.com/2017/05/against-subjective-theory-of-knowledge.html">theory</a>, and the <a href="https://econospeak.blogspot.com/2019/04/free-speech-safety-and-triumph-of.html">positive affect theory of human rights</a> (all people, or at least people from historically oppressed groups, have a right to be free of psychic discomfort) are individually indefensible and collectively toxic. Above all, they rest on an <a href="https://econospeak.blogspot.com/2017/12/the-great-awokening.html">individualized, one-consciousness-at-a-time conception of social change</a> that obscures any role for collective action, turning “the personal is political” into “the political is personal”.</p><p>My hope was that others who value genuine, on-the-ground egalitarianism would have the courage to face down this intrinsically reactionary and authoritarian—not to mention ignorant—“movement”.</p><p>No such luck. With few exceptions, progressive people who shared my outlook looked away, at most grumbling quietly to each other. We didn’t like it, but we figured it was not worth the nastiness it would stir up.</p><p>Well, it turns out that the culture-warrior Right has no such qualms and is happy to feast on the banquet DEI-ism has served them. In most instances, the practices and ideologies they denounce are just as absurd and destructive as they say they are, but the attack comes from forces whose goal is to establish conservative political control over higher education, crushing progressive thinking wherever they find it. Our side took a pass and now it’s not up to us any more.</p><p>This is a disaster of our own making. I’m not saying people like DeSantis aren’t the dishonest opportunists they are, but billionaire donors will always find politicians like that. (They will run on whatever polls best and then cut the taxes and pad the profits of the rich.) It’s our fault for making it so easy for them.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com14tag:blogger.com,1999:blog-4900303239154048192.post-30017776802591384062023-02-01T00:09:00.000-05:002023-02-01T00:09:17.152-05:00The Unbearable Tightness of Peaking<p>Sandwichman came across a fascinating and disconcerting new dissertation, titled "Carbon Purgatory: The Dysfunctional Political Economy of Oil During the Renewable Energy Transition" by Gabe Eckhouse. An adaptation of one of the chapters, dealing with fracking, was published in <a href="https://doi.org/10.1016/j.geoforum.2021.07.010" target="_blank">Geoforum</a> in 2021</p><p>As some of you may know, the specter of Peak Oil was allegedly "vanquished" by the invention of methods for extracting "unconventional oil" from shale formations (or "tight oil"), bitumen sands, and deep ocean drilling. A large part of that story was artificially low interest rates in response to the stock market crash of 2008 and subsequent recession. </p><p>What Eckhouse's dissertation and article explain is the flexibility advantage that fracking provides because the investment required for a well is two orders of magnitude less than for exploiting a conventional field and the payback time is much shorter. The downside is that the cost per barrel of the oil is much higher. Until now loose monetary policy has buffered that cost differential.</p><p>The strategic advantage of fracking, combined with the volatility of oil prices over the past two decades and uncertainty about possible future government decarbonization policies (what oil industry figures are ironically calling "peak oil demand") are making large, long-term investments in conventional oil extraction -- investments of the order of, say, $20 trillion over the next quarter century -- less attractive. </p><p>Although the latter might sound like a good thing, what it implies is a full-blown energy crisis occurring much earlier than any purported transition to renewable non-carbon energy sources. I wouldn't be surprised to see reactionary politicians and media agitate a "populist" movement to scapegoat "climate-woke" activists and scientists as saboteurs responsible for "cancelling" long-term investment in a cheap oil economy.</p><p>I had forgotten the oil price rise of 2007-08 when a barrel of West Texas Intermediate crude rose from $85 in January 2007 to $125 in November to $156 in April 2008 to $190 in June. Now I remember my sense of awe at the time and dread that something really, really bad was soon going to happen to "the economy." But then nothing happened. Nothing, that is, but the collapse of Bear Stearns and Lehman Brothers, a stock market crash, emergency bank bailouts, and subsequent central bank monetary policy of low, low interest rates. But "the fundamentals were sound."</p><p>It scrambles my brain trying to distinguish cause from effect. Did the ultra-low post 2008 crash low interest rates incidentally drive the subsequent fracking boom? Or was specifically a fracking boom one of the core objectives of the low interest rate regime?</p><p>Whither "peak oil"? According to Laherrère, Hall, and Bentley in <a href="https://www.sciencedirect.com/science/article/pii/S2666049022000524" target="_blank">How much oil remains for the world to produce?</a> (2022) "the end of cheap oil" did not go away when the oil can was kicked down the road:</p><p></p><blockquote><p>Our results suggest that global production of conventional oil, which has been at a resource-limited plateau since 2005, is now in decline, or will decline soon. This switch from production plateau to decline is expected to place increasing strains on the global economy, exacerbated by the generally lower energy returns of the non-conventional oils and other liquids on which the global economy is increasingly dependent.</p><p>If we add to conventional oil production that of light-tight (‘fracked’) oil, our analysis suggests that the corresponding resource-limited production peak will occur soon, between perhaps 2022 to 2025.</p></blockquote><p>Including "all liquids" pushes that horizon out to 2040. In short, we overshot peak oil by a couple decades with the aid of loose money and tight oil, with a little additional help from the Covid pandemic. Those of us with a memory longer than the news cycle may recall that the current round of interest rate hikes by the Fed was initiated in response to inflation, which reached a 40-year high in June of last year due to record gasoline prices. Lower demand for gasoline brings down gas prices while higher interest rates may discourage new investment in fracking posing the specter of an oil supply crunch a couple of years down the road.</p>The cartoon below illustrates the loose money/tight oil -- tight money/peak oil dilemma:<div class="separator" style="clear: both; text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgFqKC3EEfmV2Ll1lRF_EC5EX3plV7-EIr5oUR85_fyxB5DnSotscyHoVoDW9DOmq3SCYsa-16BDD7KVV7zGnz2w9Kh7jikoZdlOZ0MAcyk7-Nzdc7ZaGCfGxNm1RseAFI7O8IQ-nW6CMPlnHV4A_FcVDDWtiywSSpUOEq7m8dMdL5lRnUTBWb9eHcK0g/s526/escher.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="513" data-original-width="526" height="312" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgFqKC3EEfmV2Ll1lRF_EC5EX3plV7-EIr5oUR85_fyxB5DnSotscyHoVoDW9DOmq3SCYsa-16BDD7KVV7zGnz2w9Kh7jikoZdlOZ0MAcyk7-Nzdc7ZaGCfGxNm1RseAFI7O8IQ-nW6CMPlnHV4A_FcVDDWtiywSSpUOEq7m8dMdL5lRnUTBWb9eHcK0g/s320/escher.jpg" width="320" /></a></div><br /><p><br /></p><p></p>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com10tag:blogger.com,1999:blog-4900303239154048192.post-33267404762158452142023-01-29T13:22:00.000-05:002023-01-29T13:22:19.546-05:00No More Noma<p>Eating is a necessity and can be a great pleasure. It also has a symbolic dimension in every culture. In the long history of European civilization, going back at least to the Romans, it has been a form of status distinction, allowing the elites at the top to display their separation from the masses below.</p><p>For many centuries elite food was set apart by its ingredients, like caviar, choice cuts of meat, difficult to procure spices and rich dairy products. Restaurants in times past would announce their status appeal not only through their prices, but also menus that advertised rarity and bounty.</p><p>Today this emphasis on ingredients is not enough. A general increase in prosperity and the rise of a large middle-to-upper class that can afford them means that status distinction must now rest on much greater inputs of human labor, both the highly skilled labor of innovator-chefs and the line labor of dozens of underlings who precisely execute each minute twist of preparation or presentation. Add to this the aura of world-transforming inventiveness claimed by the tech industry, and you have Noma and restaurants like it.</p><p>There has always been a tension between elite appeal and nourishment in cuisine. The excessively rich foods of the uppermost stratum are unhealthy, which may be one reason the humbler fare of the peasantry was sometimes gussied up and given a place on the menus of the rich, like gustatory Eliza Doolittle’s. We will see whether the chem lab restaurant ethos can find a middle ground by absorbing some of the foods people used to eat before eating was “disrupted”.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com4tag:blogger.com,1999:blog-4900303239154048192.post-66149462030037412522023-01-21T01:35:00.000-05:002023-01-21T01:35:04.251-05:00Extending Capital to Nature, Reducing Nature to Capital<p>The Biden administration has announced it is inaugurating a program to incorporate the value of natural resources and ecological services into national income accounts. The <a href="https://www.nytimes.com/2023/01/20/business/economy/economic-statistics-climate-nature.html">New York Times article</a> reporting this development predictably portrays the response as divided between two camps: on the one side are environmentalists, who think this will lead to more informed decision-making, and on the other Republicans and business interests who fear it is just a stalking horse for more regulation.</p><p>For the record, here is one environmentalist (me) who thinks it’s a bad idea—not completely, but mostly.</p><p>Are the quality of our environment and the availability of natural resources crucial to our well-being? Certainly. Can these effects be captured by economic measurement? Mostly no. The monetary economy is, almost by definition, the realm of the fungible. Money is what allows us to have more of one thing at the cost of less of another, and then to change our minds and switch back to what we had before. Pizzas can be bought and sold for money. School buildings can built for money. So as a society we face a choice between different consumption categories, one that is reversible if attitudes shift.</p><p>What is fundamental about most natural resources is that they are not fungible. If you destroy an old growth forest and use the proceeds to construct a highway—not to mention a high-end housing development in Sun Valley—you can’t turn around and liquidate the road to get the forest back. And ecological services, critical as they are (they are often have literal life and death consequences), are not produced or consumed for money, which means they are outside the chain of exchange that generates the fungibility of the goods inside it. The monetary value attached to them by economists is strictly notional, and it matters that no one will actually pay for their provision or receive income from it.</p><p>The wiser approach is to have parallel accounts, many of them, and measure the impacts on our well-being in units meaningful to them. Let the fungible money economy be recorded as is, and keep close track of resource depletion, the loss of ecological services and pollution in easily understood metrics of their own. Reducing nature to measures of monetary gains and losses drains it of what makes it different and intrinsically valuable. </p><p>PS: I’ve written two books that develop this argument in different contexts, <i><a href="https://www.amazon.com/Markets-Mortality-Economics-Dangerous-Value/dp/0521123046">Markets and Mortality: Economics, Dangerous Work and the Value of Human Life</a></i> (1996) and <i><a href="https://www.cambridge.org/gb/academic/subjects/economics/natural-resource-and-environmental-economics/alligators-arctic-and-how-avoid-them-science-economics-and-challenge-catastrophic-climate-change?format=HB">Alligators in the Arctic and How to Avoid Them: Science, Economics and the Challenge of Catastrophic Climate Change</a></i> (2022).</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com3tag:blogger.com,1999:blog-4900303239154048192.post-57521025678933317392023-01-11T19:04:00.001-05:002023-01-11T19:04:07.480-05:00Herb and then Barkley: we will try to sing your song right<p> <span face=""Open Sans", Helvetica, Arial, sans-serif" style="background-color: white; color: #444444; font-size: 14px;">They are falling all around me</span></p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">They are falling all around me<br />They are falling all around me<br />The strongest leaves of my tree</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">Every paper brings the news that<br />Every paper brings the news that<br />Every paper brings the news that<br />The teachers of my sound are movin’ on</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">Death it comes and rests so heavy<br />Death it comes and rests so heavy<br />Death comes and rests so heavy<br />Your face I’ll never see no more</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">But you’re not really going to leave me<br />You’re not really going to leave me<br />You’re not really going to leave me</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">It is your path I walk<br />It is your song I sing<br />It is your load I take on<br />It is your air that I breathe<br />It’s the record you set<br />That makes me go on<br />It’s your strength that helps me stand<br />You’re not really<br />You’re not really going to leave me</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">And I have tried to sing my song right<br />I have tried to sing my song right<br />I will try to sing my song right<br />Be sure to let me hear from you</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;"><br /></p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;">--Bernice Johnson Regan</p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;"><br /></p><p style="background-color: white; border: 0px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;"><span style="color: #444444; font-family: Open Sans, Helvetica, Arial, sans-serif;"><span style="font-size: 14px;">https://www.youtube.com/watch?v=AX3l2mrkP5U</span></span></p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;"><br /></p><p style="background-color: white; border: 0px; color: #444444; font-family: "Open Sans", Helvetica, Arial, sans-serif; font-size: 14px; line-height: 1.71429; margin: 0px 0px 1.71429rem; padding: 0px; vertical-align: baseline;"><br /></p><div><br /></div>kevin quinnhttp://www.blogger.com/profile/04880872194080353414noreply@blogger.com4tag:blogger.com,1999:blog-4900303239154048192.post-36865166292377293892023-01-11T13:10:00.000-05:002023-01-11T13:10:01.193-05:00Barkley Rosser, 1948-2023<p>I've just learned that Barkley Rosser, the mainstay of this blog, died yesterday. I'd crossed paths with him in Madison, WI in the early 70s and then reconnected in the late 1980s, even coauthoring a paper with his wife Marina in 1990 (I think).</p><p>Barkley and I would get together for a meal most years during the economics meetings. He was a human tornado, quick and vociferous, backed up by a vault of reading, study and thinking. He was uncommonly wide-ranging: although his reputation rested primarily on his work in complexity theory and nonlinear dynamics, he was a textbook coauthor in comparative systems and served as editor of the Journal of Economic Behavior and Organization. Of course, if you read his blog posts here, you would know how wide his horizons were.</p><p>Bark had a great sense of humor, loved to laugh, and was optimistic despite his cynicism. He went out of his way to help others. Given his never-ending intensity, I'm glad his heart held out for this long.</p><p>One of the sadder parts of aging is having to say final goodbye's to so many people who have meant so much. Bye Bark.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com13tag:blogger.com,1999:blog-4900303239154048192.post-31533511976908941572023-01-07T08:26:00.002-05:002023-01-07T08:26:37.274-05:00Memo to Janet Yellen<p> Mint the Coin!</p><p><br /></p><p>https://talkingpointsmemo.com/edblog/debt-ceiling-hostage-update</p><p><br /></p>kevin quinnhttp://www.blogger.com/profile/04880872194080353414noreply@blogger.com9tag:blogger.com,1999:blog-4900303239154048192.post-35299392212238431622023-01-06T18:15:00.000-05:002023-01-06T18:15:04.982-05:00Herb Gintis, 1940-2023<p>My dissertation chair, Herb Gintis, died yesterday in Northampton, Mass. We didn’t stay in touch after I graduated—our interests and perspectives diverged—but I will always appreciate what he gave of himself at a difficult time in my life.</p><p>After my first dissertation went awry (don’t ask!), Herb, who had been on my committee, stepped in and helped me identify a new topic. I had to learn a new set of tools, and he was patient as I stumbled through what I now recognize as elementary technical hurdles. He even watched my kid on a couple of occasions, so I could have a few hours of freedom. I’ve heard dissertation advisors don’t always do this!</p><p>I confess that our final session together was rocky. At my dissertation defense I attacked my own work, and it was Herb who defended it. He even had to convince me to publish the game theoretic modeling in a journal—I had become so embarrassed by it. It was a terrible closure to a relationship for which I remain deeply grateful. In recent years I had thought about contacting him again just to let him know how much his generosity meant to me, but I delayed....and now it’s too late.</p><p>So I’m taking this opportunity to say that, although Herb could be crusty—he had a reputation for this—he was also a true mensch. He had an open mind and bottomless curiosity. He rose to the top ranks in a field, evolutionary game theory, he didn’t take up seriously until middle age. His intellectual partnership with Sam Bowles resulted in one of the most productive twosomes in the history of economics. (Can you name any others?)</p><p>Here is Herb’s <a href="https://en.wikipedia.org/wiki/Herbert_Gintis">Wikipedia entry</a>, and here is his <a href="https://people.umass.edu/~gintis/">website</a>. An impressive guy.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com15tag:blogger.com,1999:blog-4900303239154048192.post-65894066345034640042023-01-04T18:15:00.004-05:002023-01-04T18:15:32.564-05:00Why the Battle over Electing a House Speaker<p>I don’t know how this will turn out, and maybe what I’m about to say will be disproved by events, but here goes:</p><p>I think the Republicans face a difficulty in electing a Speaker that the Democrats wouldn’t have, and it will be hard to overcome. Democrats may disagree intensely, but they all have legislative agendas to pursue, and in the end they are likely to compromise in order to get at least some of what they want. Republicans have little to no agenda. In the last presidential election <a href="https://www.brookings.edu/blog/up-front/2020/08/25/the-2020-republican-party-platform-letat-cest-moi/">they didn’t even have a party platform</a>. Thus there is no incentive to compromise. If you’re a Republican congressman eager to cement your brand as a “patriot” who won’t settle for RINO’s like Kevin McCarthy, what would motivate you to vote for him?</p><p>True, representatives, even very right wing ones, still want federal money for their districts and to win favors for friends and donors. But these things usually take the form of riders to bills for other purposes or fine print in legislative language. The whole point of the process is that it occurs out of public purview and is therefore difficult to use to break highly visible logjams like the speakership. The IRA compromise among the Dems did involve side payments to West Virginia but primarily took the form of substantial trims to programs most Democratic senators supported.</p><p>What will a compromise that assembles a working Republican majority in the House look like?</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com2tag:blogger.com,1999:blog-4900303239154048192.post-25371066012392274262022-12-30T03:58:00.002-05:002022-12-30T03:58:43.127-05:00A New Wellbeing Rankings Study<p> David G. Blanchflower of Dartmouth and Alex Bryson of University College in London have just published a paper at NBER 30759 "Wellbeing Rankings," which provides some provocative ideas and data on various possible measures of well-being in societies. This reflects dissatisfaction with the tendency to use a single measure, "life satisfaction" on finds in the happiness literature, with ranks of nations widely publicized based on these. Traditionally Nordic nations such as Finland and Denmark come out on top of these.</p><p>This study argues one should consider not just a positive measure, but consider negatives that detract from well being as well. So, drawing Gallup and some other organizations that actually daily track people in many nations, they look at four positive affects: life satisfaction, enjoyment, smiling, and feeling well-rested along with four negative affects: pain, sadness, worry, and anger. Clearly there are major cultural differences across nations regarding some of these, such as smiling, but these are what they go with.</p><p>They also consider individual US states as "political units" and throw them into the mix. This leads to one of the larger unanswered question mbekiarks for this study. When they rank entities on their net well beings, US states generally do well, in fact provide 9 out of the top 10 entries, with only Taiwan at 8th not one, and in the top 20, only Austria, the Netherlands, and Iceland manage to get in as well. But somehow the US as a nation performs much more poorly, at 150th lower than the lowest state, West Virginia at 122. The lack of explanation of this is a serious problem.</p><p>There is much not to expect in all this. China is 30th, Denmark 38th, Finland 51st, Russia 87th, UK 111th, US 150th Ukraine 185th. The top 10 are Hawaii, Minnesota, North Dakota, South Dakota, Iowa, Nebraska, Kansas, Taiwan, Alaska, and Wisconsin. The bottom three are Palestine, South Sudan, and Iraq at 215 (Iran is at 205).</p><p>Something that happens is that some places do well on the positives but not on the negatives and vice versa. Thus Bhutan is 9th on overall positives, but lots of pain there and it ends up 99th overall. The top four just on positives are Paraguay, Indonesia, Laos, Hawaii. The top four on negatives (least harm) are Taiwan, Somaliland, Uzbekistan, China, </p><p>So, what is putting China and Taiwan so high on reducing negatives? China is 8th on avoiding pain and 2nd on avoiding sadness. Who is ahead of it on avoiding sadness? Taiwan. Hong Kong is well behind both of them at 79th. </p><p>And Russia? It has traditionally done poorly on positives on these, with mid-range life satisfaction, they are 160th in smiling (which they tend to sneer at publicly doing). But like China it does well on two negatives, coming in at 11th on worrying and 8th on anger. This raises the question of whether correspondents in authoritarian nations are willing to be honest about certain questions.</p><p>There is much to chew over this, and I think we shall be hearing more about this study in the future, despite its flaws.</p><p>Barkley Rosser</p>rosserjb@jmu.eduhttp://www.blogger.com/profile/09300046915843554101noreply@blogger.com0tag:blogger.com,1999:blog-4900303239154048192.post-506581650226274092022-12-25T00:04:00.003-05:002022-12-25T00:04:32.429-05:00Goodbye 117th Congress<p> Merry Christmas, you all.</p><p>So, the 117th Congress is done, and Nancy Pelosi is ending her historic run as Speaker of the House. It passed more legislation than we have seen happen in a congress in a very long time. While Joe Biden did not get all he wanted, much less the progressive caucus, a great deal as passed, some of it, like the infrastructure bill, that has been languishing for decades. At the tail end we got the right to marry confirmed, reform of the electoral act to prevent a VP from messing with countng votes, the CHIPs act and the Inflation Reduction Act, with inflation actually declining right now, if not due to that act particularly.</p><p>Also managed to get a spending bill passed under the wire to cover the next nine months, and the J6 comm released its report and Ways and Means got Trump's taxes.</p><p>What did not get through? An immigration bill. It looked that a modest one that would please large numbers of people on both sides was put forward by Synema and Tillis, legalising the DACA dreamers while increasing security at the border. But in the end it just could not get through. Politicians love to browbeat this issue too much to actually do anything useful about it.</p><p>The other biggie is no debt ceiling increase. I read that this would take "too much time," although I do not see why. But it did not pass, so this will become a chief playting for the GOP in the House this coming year.</p><p>There is also the problem that the green stuff in the IRA is very protectionist, violating WTO rules, and really angering European allies of the US. But I guess Biden just has Pennsylvania, Michigan, and Wisconsin on his mind.</p><p>Barkley Rosser</p>rosserjb@jmu.eduhttp://www.blogger.com/profile/09300046915843554101noreply@blogger.com1tag:blogger.com,1999:blog-4900303239154048192.post-57475482136788361212022-12-17T21:16:00.002-05:002022-12-18T00:23:26.612-05:00This Life: faith, work, and free time, part two<p>At the beginning of this year, I posted a <a href="https://econospeak.blogspot.com/2022/01/this-life-faith-work-and-free-time.html" target="_blank">response</a> to Martin Hägglund's <i>This Life: Secular faith and spiritual freedom</i>. In October I learned of a conference next May in Belgium at which Hägglund will be one of the keynote speakers. So I submitted an abstract to present a paper.</p><p>When it came time to start working on a draft for the conference, I remembered my blog post and it formed the core for the rest of the draft. In that earlier post, I wrote about Marx's identification in the <i>Grundrisse</i> of the inversion between necessary labour time and superfluous labour time. During editing of a first draft of the conference presentation I took a break and went for a walk. There it struck me that the inversion of necessary and superfluous labour time was a parallel to the inversion of <i>this life</i> and the supernatural that Ludwig Feuerbach had criticized. The following is an excerpt from my draft:</p><span><a name='more'></a></span><p>This inversion between necessary and superfluous labour time exhibits an uncanny parallel to the inversion in religion between this life and the purported afterlife. The analysis of the latter was carried out by Ludwig Feuerbach between 1830 and 1843 and published in <i>The Essence of Christianity</i>, which had a profound impact on Marx’s and Engel’s thinking. Marx adopted the concept of species-being (<i>Gattungswesen</i>) from Feuerbach’s book.</p><p>As Feuerbach explained, “that which in religion is the predicate, we must make the subject, and that which in religion is a subject we must make a predicate, thus inverting the oracles of religion; and by this means we arrive at the truth.” He invoked religion’s inversion of truth again in the concluding chapter:</p><p></p><blockquote>And we need only, as we have shown, invert the religious relations – regard that as an end which religion supposes to be a means – exalt that into the primary which in religion is subordinate, the accessory, the condition – at once we have destroyed the illusion, and the unclouded light of truth streams in upon us.</blockquote><p></p><p>In Marx’s September 1843 letter to Arnold Ruge, he expressed his enthusiasm for Feuerbach’s critique of religion and envisioned applying the same method to a critique of politics:</p><p></p><blockquote><p>Like Feuerbach's critique of religion, our whole aim can only be to translate religious and political problems into their self-conscious human form.</p><p>Our programme must be: the reform of consciousness not through dogmas but by analyzing mystical consciousness obscure to itself, whether it appear in religious or political form. It will then become plain that the world has long since dreamed of something of which it needs only to become conscious for it to possess it in reality.</p></blockquote><p></p><p>Feuerbach described the doctrine of immortality as “the final doctrine of religion; its testament, in which it declares its last wishes.” He dismissed the argument that the characteristics of a future life are inscrutable as an invention of religious skepticism and instead presented a concise definition of immortality as an ideal image of this life, rid of its contradictions: </p><p></p><blockquote>The future life is nothing else than life in unison with the feeling, with the idea, which the present life contradicts. The whole import of the future life is the abolition of this discordance, and the realization of a state which corresponds to the feelings, in which man is in unison with himself.</blockquote><p></p><p><br /></p>Sandwichmanhttp://www.blogger.com/profile/11159060882083015637noreply@blogger.com2tag:blogger.com,1999:blog-4900303239154048192.post-1482393056758084312022-12-15T23:50:00.002-05:002022-12-15T23:50:35.936-05:00The Political Economy of Effective Altruism<p> Back in the day, I used to give talks on child labor. I would always begin by saying that boycotts and shaming of corporations, while understandable as an emotional response, were unlikely to do much for the world’s children. This was because very little child labor is employed in making internationally tradeable products. Moreover, simple prohibitions don’t get at the root causes, which need to be identified and addressed with national and international policies. Most of the talk would be about those causes, and I would end with a call for people in the audience to get involved politically, so that US policy would at least not reinforce the conditions that impose poverty and insecurity on much of the world’s population. I would give a list of specific demands.</p><p>Feeling like I had communicated a complex topic persuasively and provided a motivating political spin at the end, I would ask for questions. Inevitably, the first would be some variation on “What should(n’t) I buy?” People were so enclosed in a worldview in which only individuals could take action, and “collective action” meant lots of individuals were doing the same thing, that my argument simply couldn’t get through.</p><p>Effective altruism is a variation on the same theme, only substitute philanthropy for shopping. If “what should I buy?” springs from the consumption portion of income, “how should I give?” pertains to the portion not dedicated to current or future consumption. The first question would be asked by a citizen of the 99%, the second by a one-percenter.</p><p>But it’s worse than that. Conscious consumerism’s only fault is that it occupies the ethical place that should be the seat of politics; conscious philanthropy adds the additional problem that the surplus income it channels is itself the consequence of choices that can make the world a better or worse place. To put it bluntly, effective altruism allows people to exploit or even defraud others to become rich, so long as they expiate themselves by giving away the surplus portion of their riches in accordance with an approved set of criteria. Its ideological function is cemented by the criteria themselves, which call for discrete interventions with measurable outcomes; these can be applied to philanthropic donations but not to the more systemic interventions addressable by politics.</p><p>So we come to the fact that Samuel Bankman-Fried gave enormous sums of money to politicians, think tanks and other receptacles whose purpose was to enable him to make yet more money, for instance by expanding the pool of potential investors in his crypto exchange to pension funds. <a href="https://www.ineteconomics.org/perspectives/blog/bankman-fried-political-money-and-the-crash-of-ftx">He gave more or less equally to Democrats and Republicans.</a> (The official donations to the Dems were slightly greater, but by his own admission Bankman-Fried channeled more of the dark money to Republicans.) The favored Dems were, not surprisingly, corporate-friendly third-wayists, like the Center for American Progress. Objectively, no matter how brilliantly he might divide his philanthropy between malaria bednets and techie projects to avert an AI singularity, his contribution to world betterment was more than offset by shoring up the global order via the political arm of his investments. Effective Altruism exists to foreground the first and obscure the second.</p><p>The prominence of both consumerist and philanthropic strategies to fix what’s wrong with the world are reflections of an immense political vacuum. Somehow, and quickly, politics needs to be rebuilt from the ground up: a vision of genuine change that can grapple with the extreme challenges that face us, political movements organized around elements of that vision, and a few victories along the way to give us strength and spirit. The goal would be to live in a world in which “what should I buy?” and “how should I give?” were no longer regarded as important political questions.</p>Peter Dormanhttp://www.blogger.com/profile/00093399591393648071noreply@blogger.com0tag:blogger.com,1999:blog-4900303239154048192.post-46859801695780281862022-12-15T16:30:00.002-05:002022-12-17T17:16:47.204-05:00What Is The Bielefeld School Of Economics?<p> This is about a paper I have just written for a special issue to appear in a journal I used to edit about the late economist, Peter Flaschal. Who most of you are probably thinking, although maybe not all of you? He was a heterodox macroeconomist located for his entire career at Bielefeld University in Germany. He coauthored a lot with a group of economists who either were on the faculty there, at least for some time, or visited there frequently. Some of the other members of this group are the also now late Carl Chiarella of the University of Technology in Sydney, Australia, Willi Semmler of the New School in New York, Peter Skott of U-Mass Amherst, Toichiro Asada of Chuo University in Tokyo, Reiner Franke of Bremen University in Germany. They have tended to work on fairly mathematical nonlinear dynamics models that can show both growth and endogenous cycles, including complex ones such as chaotic, so, unsurprisingly, up my alley. </p><p>Their most important influence was models of this sort by the late Richard Goodwin, who had a Marx-influenced predator-orey model of class struggle syclical fluations. Their early models were labeled as Kynes-Wicksell-Goodwin (KWG) models, But then they picked up invnentory adjustment models from Metzler, leading them to label their models Keynes-Metzler (KMG) models. Around 2009 Flaschel in particular, sort of following Goodwin on this, put more emphasis on both Marx and Schumpeter, relabeling their models as Keynes-Marx-Schumpeter (KMS) models. Their models differ both from the New Keynesian models that assume rational expectations and dominate much of academic macroeconomics nnd are paid attention to by central bankers, and also Post Keynesian models, that tend to be less mathematical, although both have also been influenced by Kalecki and Kaldor. Partly because they have had trouble publishing in to journals and have never created any of their own like the Post Keynesians have, they have done a lot of book writing, with Flaschel an author of coauthor on 17, not counting even more he edited or coedited, mostly with people named above.</p><p>Flaschel and several of them also advocating somewhat leftish policies for government intervention in economies to stabilize the endogenous fluctuations their models show to be prevalent, with these largely driven by real effects involving wage-price dynamics and inventory adjustments rather than financieal fluctuations, although they have well-developed financial sectors in their models, and some of them have done a lot of financial modeling, notably the late Chiarella, who wss a coeditor of the Journal of Economic Dynamics and Control for a while. </p><p>Anyway, the policy angle that Flaschel especially came to advocate, along with Proano and Asada has been flexicurity, an approach inspired by policy in Denmark. It combines having a flexible labor market on both sides, free hirigin and firing with strong labor organizing, and a strong social safety net with government serving as an "employer of first resort." They have also advocated educational reforms to enhance all this as well as the use of pension funds for financing real capital investment, again with an idea to help smooth out business cycles. This approach has many supporters in the EU, where Flashel's writings on this have gotten some attention, although critics have called them "naive."</p><p>Anyway, I gave them this label of "Bielefeld School" in a Foreword I wrote for one of their books in 2995, Foundations for a Disequilibrium Theory of the Business Cycle: Qualitative Analysis and Quantittative Assessment, by Chiarella, Flaschel, and Franke our of Cambridge University Press. The label has not caught on much, and they have not gotten as much attention as I think they deserve. My paper compares them in more detail to Post Keynesians, who are perhaps more combative about their heterodox relations with mainstream economics and only barely aware of these people, who sometimes put them down for their sometimes lack of mathematical rigor. I suggest that their common admiration for Kalecki and Kaldor and Goodwin whose models can generate complex dynamics is a possible opening for them to communicate and support each other, especially given that they are generally in the same neck of the ideological and policy woods, with the modern monetary theorists full emploiyment ideas looking somewhat like those of this flexicurity approach that does not get talke about in the US.</p><p>Barkley Rosser</p>rosserjb@jmu.eduhttp://www.blogger.com/profile/09300046915843554101noreply@blogger.com0tag:blogger.com,1999:blog-4900303239154048192.post-64438842925263228002022-12-03T17:38:00.001-05:002022-12-03T17:38:34.953-05:00Mourning The Late Jiang Zemin?<p>Former Chinese leader Jiang Zemin died at age 96 on Nov. 30, curiously just as the worst outbreak of demonstrations to happen in China since 1989 happened, probably now come to an end, as China both suppresses them, arresting some people based on phones and visual surveillance, as well as some loosening in certain locations of the zero covid policy. Jiang came to power initially in the immediate wake of Tienanman Square in 1989, reportedly pulled up the ranks by retired elders, the unofficial but powerful "Sitting Committee" of the Politburo. Someone with a record as a somewhat opportunistic technocrat, it was initially thought he would be weak, but he remained in power until 2002, and continued to hold the Chairmanship of the Military Commission until 2004, while somewhat weaker Hu Jintao had become General Secretary of the Party and also President. </p><p>Indeed, in his efforts to centralize power totally on himself, the networks of those linked to other powerful figures he needed to put down were probably more allied to Jiang than to Hu. If there was a serious alternative to Xi, it was probably Jiang more than Hu, although obviously Jiang had become very old and ill. </p><p>But his death does pose a difficult moment for Xi. Apparently the state funeral will be this coming Tuesday, Dec. 6. There has been a history of political trouble following the deaths of former leaders, with the Tienanman Square uprising following the death of former leader Hu Yubang. It is not that Jiang was all that liberal, indeed was probably less so than his successor, Hu. But many are indeed making unfavorable comparisons between him and Xi, with his regime being remembered for being more open and free and tied to the rest of the world, with China joining the WTO during his time, as well at the period experiencing solid and unbroken economic growth. China has become very isolated, even more so with the covid locdowns that have become the focus of recent demonstrations.</p><p>Probably Xi will be able to get through this without too much upheaval, especially with the demonstrations against the lockdowns apparently shut down. Nevertheless, it is reported that this funeral has many people talking more openly about unhappiness with the current regime.</p><p>Barkley Rosser</p>rosserjb@jmu.eduhttp://www.blogger.com/profile/09300046915843554101noreply@blogger.com9tag:blogger.com,1999:blog-4900303239154048192.post-49504874959786538012022-12-02T01:39:00.001-05:002022-12-02T01:39:52.901-05:00Economic Policy After The Midterm Elecions<p> Will economic policy change much aa a result of the midterm elecrtions? After all, the GOP has taken the House of Representatives, if only narrowly, with inflation and the economy supposedly the top issue, especially for those supporting the GOP. Will this reappearance of "divided government" have an impact on economic policy? My bottom line is probably not too much, although there is the serious possibility of some major drama and damage happening during this coming year.</p><p>On the matter of having "divided government," I must note that we already have been having that, if not in the way this is usually posed. While Dems nominally controlled both the White House and Congress, although only partially so in the Senate given the need for 60 votes to win on any issue not tied to the budget and thus able to managed by reconciliation (and even on those not necessarily, given two Dem senators not always supporting Dem budget-related proposals), what has been left out of such discussions has been the Supreme Court. It has been dominated strongly the past two years by serious conservatives appointed by GOP presidents who have taken an aggressive stance on overturning policies accepted by past presidents and Congresses dominated by both parties. An egregious example of this regarding economic policy has been the restricting of the EPA's ability to regulate pollution, a serious matter.</p><p>Of course a major reason the change of control of the House will not have all that much effect on inflationary policy is that the Fed is the lead entity on that, and I do not see the Fed changing its policy that much in response to the election, whatever one thinks of the Fed's policy. As it is they have been fairly sharply raising interest rates recently, with the value of the US dollar being quite strong, with this in fact beginning to show some signs of inflation beginning to slow down, if still much higher than most people would like it to be. And we now have hints from Powell that while the Fed is still intent on further interest rate increases, those may also begin to slow down somewhat, maybe only 50 basis points up in December rather than 75. Again, these considerations look disconnected from the election outcome.</p><p>Obviously where the House may be able to change economic policy somewhat involves fiscal policy, given the House role in budgetary policy. And they may in fact make efforts to reduce or eliminate funding for certain Biden admin initiatives, particularly some in the Inflation Reduction Act (IRA). As it is much of Biden's fiscal policy will not be affected. The probably somewhat inflatoinary ARPA is largely over, although there is still some disbursement of funds from it still happening. Also, the infrastructure and CHIPS acts seem to have some GOP support, so will probably be largely left alone.</p><p>What seems to be the top target in the IRA is funding for increasing the number of auditors in the IRS, with the GOP having put out all kinds of phony scare stories about these agents to be hired showing up armed at the doors of all kinds of middle class people. As it is, many of those to be hired are supposed to help out with such things as answering telephones, which most of the time now does not happen, with this sort of thing having become a problem due to many funding cuts in recent years for the IRS pushed by the GOP in Congress. In terms of enforcement the new agents are supposed to focus on higher income scofflaws as well as corporate ones, not middle or lower class ones. In any case, if the GOP-run House does succeed in cutting this funding, this will be inflationary due to reducing tax revenues. </p><p>Another fiscal policy matter they might well push, although this is more likely to get blocked by the Senate or Biden veto is again cutting tax rates for higher income and wealthier people. This would also be inflationary if it gets implemented.</p><p>Arguably anti-inflationary would be cuts to Social Security and Medicare, although these are less likely to get passed, with I suspect some GOPs in Congress not wanting to get on board such cuts. But in fact cuts to Medicare might lead to higher costs rather than lower ones for recipients, and any changes to Social Security, if they were to happen, would probably take the form of raising the retirement age, only affecting Social Security outlays sometime in the future, not anytime soon.</p><p>Probably the only possibly anti-inflationary policy they would push might be for various policies to increase fossil fuel production in the US. These are likely to be blocked by veto if not the Senate, and would only have a fairly small impact some time in the future, given that as of now oil companies are sitting on lots of unused permits for drilling on public land. And one of the items the GOP loves to talk about a lot, the XL pipeline from Canada, would have zero impact on oil production in the US, and probably near zero even on production in Canada, as most of that oil gets out by other means anyway.</p><p>What the GOP in the House seems mostly obsessed with is having lots of hearings, with almost none of these having anything to do with economics, much less inflation in particular. Their top priority seems to be to expose the salacious contents of Hunter Biden's laptop, which like the 8 in a row Benghazi hearings will find nothing because there is apparently actually nothing on there about Joe Biden involving anything that actually happened, although that will provide lots of opportunities for GOP Reps to get on Fox News and its crazier cousins to promise that the next day will bring that witness that will surely show how bad Biden was. Hearings on Afghanistan, Fauci, and much else will also be similarly irrelevant to economic policy, although if they have hearings on trying to reduce immigration, well, like cutting funding for the IRS, this will likely be inflationary, not the opposite.</p><p>The possibility for drama involves the old saw matter of the debt ceiling, which the newly crazy GOPs in the House may well be willing to resist raising while making unacceptable demands to the point of triggering a default, which could indeed bring crashing financial markets and a global recession, with at least some degree of recession having non-trivial probability of happening anyway this coming year due both to Fed tightening as well as economic slowing in the rest of the world coming from China and the effects of the war in Ukraine. This suggests that a high priority for the Dems in Congress in the remainder of the lame duck session should be to use reconciliation to either substantially raise the debt ceiling or, better yet, just eliminate the darned thing that has been a damaging anachronism since almost the time it was instituted over a century ago, the only such thing on the planet. </p><p>But, unfortunately, it seems that neither Biden nor any leading Dem in Congress, not even Bernie Sanders, seems at all interested in doing anything about this. Why they are so complacent on this I really do not know, although it seems they are all scared of some boogeyman of being viewed as "fiscally irresponsible." But, as far as I am concerned, it looks to be utterly fiscally irresponsible to allow these incoming lunatics in the House the ability to wreak havoc on this matter. Deals were cut in the past in similar situations, as in 2011, and some Dems may think that the GOP will get blamed for any bad outcome on this. But blaming GOP for a temporary government partial shutdown is one thing. Blaming them for a major recession is quite another, with blame for that, if it gets really bad and spills into 2024, much more likely to end up on the doorstep of the White House. What are they thinking?</p><p>Barkley Rosser</p>rosserjb@jmu.eduhttp://www.blogger.com/profile/09300046915843554101noreply@blogger.com0