Probbly not, but there has been some movement in that direction. The New Economic Policy (NEP) was the Socviet system in the 1920s after the War Communism period and before Stalin imposed command central planning as well as full state ownership of the means of production, classsic socialism. The War Communism period was a command economy, but without central planning. Famine appeared as authorities demanded crops from farmers.
The NEP was a partial move back from War Communism to a mixed economy in which most of the "commanding heights" were nationalized, but smaller businesses were privately owned. There was basically a makrket economy with agriculture privare and market oriented.
When the USSR ceased to exist, central planning ended in Russia, and there was widespread privatization, even as some sectors remained state owned. What has happened in recent years has been a mild trend towards renationallizing several large firms in several sectors, or letting a dominant state-owned firm become more dominant compared to privatedly owned ones. This has happened in the oil and gas sectors shere both Rosneft and Gazprom have been renationalized, with only Lukoil privately owned, now the largest privately owned firm in the economy. In banking there were over 1000 privately owned banks at one point, but the vast majority have failed and increasingly the sector is dominated by always state-owned Sberbank, with the Gazprom bank also being renationalized when Gazprom was. The railroads remain state-owned as well as the Telecoms.
It is not clear what proportion of the economy is state owned or state directed, with different sources saying anything between 40 and 70%. However, agriculture and most smaller businesses are privately owned and there is no central planning, even though the state does direct much of what goes on in the economy. The system is not precisely the same as the old NEP, but it is not all that far off and it may have become more like it in recent years. On a just-ended visit to Moscow I heard from someone at the central bank that reported inflation numbers are not precisely accurate as they are set ahead of time by policmakers to fit budget projections, with, in effect, the central bank having to try to make those numbers be true, or at least close enough to get awy with the lie.
Addendum (3/12, 8:15 AM): A way NEP different than now is that was a period of social and cultural liberalism and innovation, with the influence of the church suppressed. One saw modern literary forms, such as the poetry of Mayakovsky, constructivism in architecture, abstract art as with Kandinsky and Malevich, new names for things, and much more, although it was not a political democracy. But now, with at least nominal democracy, the churh is increasingly influential, homophopbia and xenophobia are on the rise, and a nationalist and autoritatian themes are on the rise.
Actually, this part, along with the form of state control of the economy in place, more resembles Italy in the 1920s than Russia.
Barkley Rosser
Monday, March 11, 2019
Sunday, March 10, 2019
What’s New About Fake News?
The apparently falling standards for what people are willing to believe in seems to be the topic of the day. We have immense, well-capitalized media outlets like Fox News just making stuff up, crazy conspiracies on the internet, a refusal to accept scientific expertise on matters, like climate change, where it is as well established as it’s ever been. What’s up with all this?
I was provoked into thinking about this by a dreadful book review in The Nation: David Bell on Sophia Rosenfeld’s Democracy and Truth. I haven’t read Rosenfeld, and maybe she’s pretty good, but it’s clear Bell is confused about the very starting point for thinking about the problem. He talks about “regimes of truth”, which he cribs from Foucault: there is no capital-T truth out there, just different views on it which possess more or less power/authority. We happen to suffer from elites or at least some portion of them, writes Bell, who have particularly dismal standards regarding what should count as true. The solution is to replace the bad authorities with good ones, more or less.
The error, which ought to be obvious, is that capital-T truth is irrelevant. It’s the wrong reference point, and it doesn’t matter that no one really knows (for sure) what it is. The real question is, what are the standards we hold ourselves to in learning about the world and minimizing error? For instance, do we honestly engage with those who disagree with us? Do we maintain a modicum of self-doubt and face up to the evidence that could show us we’re wrong about something? Do we respect logical consistency? These standards don’t guarantee we’ll arrive at the Truth, nor even that we’ll know it if we stumble on it by accident. They do reduce the risk of error, and that’s about all we can ask. By not centering the discussion on standards for argument and belief, Bell can’t even pose the relevant question.
So what’s distinctive about the current situation? I don’t think it’s the extent of dishonest and otherwise wildly erroneous argument and pseudo-facticity; there’s been an abundant supply of that over my lifetime (I’m on in years), and from what I’ve read it was abundant long before that. I can remember being furious at the Walter Cronkites and David Brinkleys of my youth for purveying news that was blatantly false.
Here’s a hypothesis. What has changed is not the amount of falsehood but the willful disregard for standards of error detection in order to disseminate it. We live in a world of greatly increased information flows, where a false news report can and will be contradicted within minutes by someone in a position to recognize it, document its falsity and post it on electronic media somewhere. A higher proportion of the population is college-educated than ever before, and even many reporters can understand budgets, follow basic statistical analysis, and make sense of scientific arguments. In other words, as standards have risen, standardlessness stands more exposed than it did in the past. It’s simply more blatant, because it has to be.
Take an example: the Gulf of Tonkin “incident”. This was, as all sides now agree, a direct, calculated lie. The administration of Lyndon Johnson wanted a free hand to wage war in Indochina; to get it they fabricated a fake attack by North Vietnam on a US navy ship. (The actual attack was us against them.) But it wasn’t transparently false. There was a tiny trickle of evidence from Hanoi and only much belated information from US sailors. It was a fog of war thing. Today, on the other hand, when Trump issues a lie, the counterevidence is in front of our eyes within minutes. To maintain his lie, Trump has to discard elementary standards of truth-seeking and reveal himself for what he is. LBJ had the luxury of being able to keep up appearances.
I don’t mean to come across as so cynical as to say there’s no difference. On the contrary, standards matter enormously. Both presidents lied, but only one directly and openly flouts the standard that evidence should count. My claim is that we’ve arrived at a point at which transparent disregard for logic and evidence is the only way to continue lying.
I was provoked into thinking about this by a dreadful book review in The Nation: David Bell on Sophia Rosenfeld’s Democracy and Truth. I haven’t read Rosenfeld, and maybe she’s pretty good, but it’s clear Bell is confused about the very starting point for thinking about the problem. He talks about “regimes of truth”, which he cribs from Foucault: there is no capital-T truth out there, just different views on it which possess more or less power/authority. We happen to suffer from elites or at least some portion of them, writes Bell, who have particularly dismal standards regarding what should count as true. The solution is to replace the bad authorities with good ones, more or less.
The error, which ought to be obvious, is that capital-T truth is irrelevant. It’s the wrong reference point, and it doesn’t matter that no one really knows (for sure) what it is. The real question is, what are the standards we hold ourselves to in learning about the world and minimizing error? For instance, do we honestly engage with those who disagree with us? Do we maintain a modicum of self-doubt and face up to the evidence that could show us we’re wrong about something? Do we respect logical consistency? These standards don’t guarantee we’ll arrive at the Truth, nor even that we’ll know it if we stumble on it by accident. They do reduce the risk of error, and that’s about all we can ask. By not centering the discussion on standards for argument and belief, Bell can’t even pose the relevant question.
So what’s distinctive about the current situation? I don’t think it’s the extent of dishonest and otherwise wildly erroneous argument and pseudo-facticity; there’s been an abundant supply of that over my lifetime (I’m on in years), and from what I’ve read it was abundant long before that. I can remember being furious at the Walter Cronkites and David Brinkleys of my youth for purveying news that was blatantly false.
Here’s a hypothesis. What has changed is not the amount of falsehood but the willful disregard for standards of error detection in order to disseminate it. We live in a world of greatly increased information flows, where a false news report can and will be contradicted within minutes by someone in a position to recognize it, document its falsity and post it on electronic media somewhere. A higher proportion of the population is college-educated than ever before, and even many reporters can understand budgets, follow basic statistical analysis, and make sense of scientific arguments. In other words, as standards have risen, standardlessness stands more exposed than it did in the past. It’s simply more blatant, because it has to be.
Take an example: the Gulf of Tonkin “incident”. This was, as all sides now agree, a direct, calculated lie. The administration of Lyndon Johnson wanted a free hand to wage war in Indochina; to get it they fabricated a fake attack by North Vietnam on a US navy ship. (The actual attack was us against them.) But it wasn’t transparently false. There was a tiny trickle of evidence from Hanoi and only much belated information from US sailors. It was a fog of war thing. Today, on the other hand, when Trump issues a lie, the counterevidence is in front of our eyes within minutes. To maintain his lie, Trump has to discard elementary standards of truth-seeking and reveal himself for what he is. LBJ had the luxury of being able to keep up appearances.
I don’t mean to come across as so cynical as to say there’s no difference. On the contrary, standards matter enormously. Both presidents lied, but only one directly and openly flouts the standard that evidence should count. My claim is that we’ve arrived at a point at which transparent disregard for logic and evidence is the only way to continue lying.
Saturday, March 2, 2019
Visa Restrictions And Intellectual Degradation
I am in New York attending the Eastern Economic Association meetings. I was in an agent-based modeling session in which two partticipants participated by internet because they were both refused visaas to enter the US. One was from Turkey, which I think is under strict review by the current administration. The other, a woman from India, working for an American think tank in Toronto, may have simply been a victim of somebody messing up and being too slow in getting the appropriate application forms in on time. But I am sure the deal on the Turkish participant was new policy.
Their presentations, on self-organizing hierarchies and cryptocurrency dynamics, mostly got through to us. But even with this high-tech ABM crowd there were problems and glitches and occasional disconnctions. It should not have been this way.
This is just dumb obvious. You arbitrarily keep smart foreigners out of your country, this will lead to intellectual degradation.
Barkley Rosser
Tuesday, February 26, 2019
Iran's Foreign Minister Is Out
This looks like bad news. Iran's foreign minister, JMohammed avad Zarif, hass resigned. Apparently he has previously tried to resign several times, but President Rouhani refused to accept it. This time Zarif did it very publicly on Instagram, ah, the uses of social media. Anyway, apparently there is a chance he might still be talked into staying, but probably not. It seems that he has lost the favor of Supreme Leader Khamenei, and that effectively somebody lse is handling foreign policy now, almost certainly hardliners, perhaps from the Revolutionary Guards. The most obvious sign of this is that yesterday Syria's leader, Bashar al-Assad visited Tehran, and Zarif was not at the meeting with other top Iranian leaders. His reignation came later in the day after the meeting.
We do not know the details, but pretty clearly Zarif is out because of the US withdrawing from the JCPOA nuclear deal and imposing strong economic sanctions that have seriously impacted the Iranian economy, despite all other signatory nations have pledged to support the agreement and offset the sanctions. But the ability of the US to pressure compainies to withdraw from deaaling with Iran out of the threat of having no access to the US market, as well as pushing some nations to switch from importing oil from Iran, has had its impact. The upshot has been that all the hardliners in Iran who doubted the wisdom of negotiating the JCPOA that led to Iran giving up most of its potential nuclear weapons capability have come out to sneer and criticize the Rouhani government as a bunch of suckers. Foreign Minister Zarif was the point man in the negotiations, and so it appears that he is the scapegoat for now for all the trouble Iran is suffering as a result of Trump's actions.
In any case, anybodyin the US who thinks this is a good development is very fooliish.
Addendum: 2/27, 11:00 AM
This morning's Washington Post reports that President Rouhani is refusing to accept Zarif's resignarion. Not clear how all this will play out.
Barkley Rosser
We do not know the details, but pretty clearly Zarif is out because of the US withdrawing from the JCPOA nuclear deal and imposing strong economic sanctions that have seriously impacted the Iranian economy, despite all other signatory nations have pledged to support the agreement and offset the sanctions. But the ability of the US to pressure compainies to withdraw from deaaling with Iran out of the threat of having no access to the US market, as well as pushing some nations to switch from importing oil from Iran, has had its impact. The upshot has been that all the hardliners in Iran who doubted the wisdom of negotiating the JCPOA that led to Iran giving up most of its potential nuclear weapons capability have come out to sneer and criticize the Rouhani government as a bunch of suckers. Foreign Minister Zarif was the point man in the negotiations, and so it appears that he is the scapegoat for now for all the trouble Iran is suffering as a result of Trump's actions.
In any case, anybodyin the US who thinks this is a good development is very fooliish.
Addendum: 2/27, 11:00 AM
This morning's Washington Post reports that President Rouhani is refusing to accept Zarif's resignarion. Not clear how all this will play out.
Barkley Rosser
The Trump Tax Cut and Big Pharma
CEOs of 7 pharmaceutical multinationals addressed the Senate Finance Committee:
Pharma execs offer Senate ideas to lower drug costs – except actually cutting prices. Executives from seven pharmaceutical companies — AbbVie, AstraZeneca, Bristol-Myers Squibb, Johnson & Johnson, Merck, Pfizer and Sanofi — are testifying before the Senate Finance Committee. The pharma executives have a number of ideas to reduce drug prices for patients, except lowering list prices. High drug prices has become a rare bipartisan issue, with lawmakers on both sides of the aisle demanding change.One of these questions posed to the CEO of Abbvie was how much of the benefit from the 2017 tax cut did his company pass onto consumers. I guess the Senator was expecting an honest answer being “none”. But the actual answer came out that AbbVie did not get much benefit from this reduction of corporate profit tax rates. How could that be? Well – look at its past 10-K filings and you will see that AbbVie has sourced little to none of its massive profits to the U.S. parent. Why would you benefit from a tax rate cut when one is engaged in massive transfer pricing manipulation?!
Saturday, February 23, 2019
Neoliberalism as Structure and Ideology in Higher Education
A few weeks ago I speculated on the structural aspect of neoliberalism at an economy-wide level, the way its characteristic framing of economic decision-making may have emerged from changes in the role of finance in business and the composition of high-end portfolios. My purpose was to push back against the common tendency to view neoliberalism solely as a philosophy, to be countered by other philosophies. Today I stumbled across this superb bit of reporting from the Chronicle of Higher Education that implicitly makes the same kind of argument in a different context. (Hat tip: Naked Capitalism.)
The article describes the massive expansion of non-profit online education that has occurred in recent years, with several institutions approaching 100,000 students each. Interviews with planners and administrators make it clear that the motivating force is not a philosophical rethinking of what education means or should mean; rather they are responding to the emergence of a market that someone needs to serve—if not them, someone else. More than 30 million adults in the United States have some college credits under their belt but no degree. With the labor force increasingly segmented by credentials, many of them are desperate to finish their degrees as quickly as possible. Since they are trying to make ends meet at low-wage jobs, they want programs that are as convenient and inexpensive as possible: commodity education. Everything about the new online degree providers is dictated by this situation.
Read the article for yourself. Here’s what I like about it:
It isn't weighed down by explicit value judgments. It lets readers do this for themselves.
It presents what we can call a neoliberal turn in higher education not primarily as a change in philosophy or mode of discourse, but as a reflection of changing circumstances. There's a two-way dance between the economic pressures facing students, their expectations and competences in a world in which the role of consumer has been made more determining and ubiquitous, the shift toward tuition financing, and other economic factors on the one hand, and the cognitive structures those implementing these systems use to justify and assess what they're doing on the other. If anything, the article foregrounds the arrow going from economic context to cognition, which redresses the balance somewhat (as I see it).
Also implicit is the class nature of what is taking place. The term “elite” is used to describe traditional educational models, as (alas) it should be. Those who can afford to center their daily life around attendance at a physical college or university have become a fortunate minority. (In 2017 the New York Times published a useful tool that allows you to look up the median family income of students at a wide range of schools; at the University of Washington, for instance, the median was $113,000. The source data were assembled by Opportunity Insights.) Wealthy families will continue to send their kids to places where they can get immersive, open-ended and potentially transformative experiences; the rest can shop online.
But the lines of demarcation are fuzzy. Some potential students face a choice between “elite” and commodity education, and this introduces a degree of competition between tradition and online models. Unless they have an ample supply of paying customers and a hefty endowment, institutions of higher ed will feel the pressure of the online credentialers in curriculum, student expectations, and of course price. Indeed, they already have.
Competition within the commodity education sector is also fierce, since the product is essentially standardized—a degree certificate—and geographic considerations no longer apply. Hencing branding, and all the activities that enter into it, becomes crucial. This is why Arizona State University, according to the article, has trademarked the phrase “universal learner”; it gives them a competitive edge against other outfits not permitted to describe their mission with these words. Again, the privatization of the intellectual commons is not the product of ideological zeal but everyday economic incentives—incentives that were much weaker in the past but have now been exacerbated by the organization of the commodity education sector.
It should be obvious that a driving force behind this set of developments is the decision to shift from a public to a tuition financing model in public higher ed. That decision can and should be reversed. Anyone who cares about the future of education (and culture and democracy and all that stuff) should be fully on board. At the same time, the process is also propelled by the extraordinary increase in economic inequality. As long as educational credentials play such a large role in determining the life chances of most people in our society, this consideration will push aside others in how colleges and universities are organized, what curriculum they offer and what they will ask of the students who attend them.
To sum up: the long term prospects for higher education are dim as long as current economic and institutional trends continue. While intellectual disputation of the rationale for commodity education is a worthwhile enterprise, it won’t have much impact on the ground. Changing course requires we remove tuition (and other economic barriers) as a filter for who has access to quality education, and that we drastically reduce inequalities in the labor market so students have the luxury of valuing education for more than its sorting function.
The article describes the massive expansion of non-profit online education that has occurred in recent years, with several institutions approaching 100,000 students each. Interviews with planners and administrators make it clear that the motivating force is not a philosophical rethinking of what education means or should mean; rather they are responding to the emergence of a market that someone needs to serve—if not them, someone else. More than 30 million adults in the United States have some college credits under their belt but no degree. With the labor force increasingly segmented by credentials, many of them are desperate to finish their degrees as quickly as possible. Since they are trying to make ends meet at low-wage jobs, they want programs that are as convenient and inexpensive as possible: commodity education. Everything about the new online degree providers is dictated by this situation.
Read the article for yourself. Here’s what I like about it:
It isn't weighed down by explicit value judgments. It lets readers do this for themselves.
It presents what we can call a neoliberal turn in higher education not primarily as a change in philosophy or mode of discourse, but as a reflection of changing circumstances. There's a two-way dance between the economic pressures facing students, their expectations and competences in a world in which the role of consumer has been made more determining and ubiquitous, the shift toward tuition financing, and other economic factors on the one hand, and the cognitive structures those implementing these systems use to justify and assess what they're doing on the other. If anything, the article foregrounds the arrow going from economic context to cognition, which redresses the balance somewhat (as I see it).
Also implicit is the class nature of what is taking place. The term “elite” is used to describe traditional educational models, as (alas) it should be. Those who can afford to center their daily life around attendance at a physical college or university have become a fortunate minority. (In 2017 the New York Times published a useful tool that allows you to look up the median family income of students at a wide range of schools; at the University of Washington, for instance, the median was $113,000. The source data were assembled by Opportunity Insights.) Wealthy families will continue to send their kids to places where they can get immersive, open-ended and potentially transformative experiences; the rest can shop online.
But the lines of demarcation are fuzzy. Some potential students face a choice between “elite” and commodity education, and this introduces a degree of competition between tradition and online models. Unless they have an ample supply of paying customers and a hefty endowment, institutions of higher ed will feel the pressure of the online credentialers in curriculum, student expectations, and of course price. Indeed, they already have.
Competition within the commodity education sector is also fierce, since the product is essentially standardized—a degree certificate—and geographic considerations no longer apply. Hencing branding, and all the activities that enter into it, becomes crucial. This is why Arizona State University, according to the article, has trademarked the phrase “universal learner”; it gives them a competitive edge against other outfits not permitted to describe their mission with these words. Again, the privatization of the intellectual commons is not the product of ideological zeal but everyday economic incentives—incentives that were much weaker in the past but have now been exacerbated by the organization of the commodity education sector.
It should be obvious that a driving force behind this set of developments is the decision to shift from a public to a tuition financing model in public higher ed. That decision can and should be reversed. Anyone who cares about the future of education (and culture and democracy and all that stuff) should be fully on board. At the same time, the process is also propelled by the extraordinary increase in economic inequality. As long as educational credentials play such a large role in determining the life chances of most people in our society, this consideration will push aside others in how colleges and universities are organized, what curriculum they offer and what they will ask of the students who attend them.
To sum up: the long term prospects for higher education are dim as long as current economic and institutional trends continue. While intellectual disputation of the rationale for commodity education is a worthwhile enterprise, it won’t have much impact on the ground. Changing course requires we remove tuition (and other economic barriers) as a filter for who has access to quality education, and that we drastically reduce inequalities in the labor market so students have the luxury of valuing education for more than its sorting function.
The Tsunami of Tstupidity
An edited video of an encounter between Senator Diane Feinstein of California and a group of young campaigners for the Green New Deal is eliciting much outrage and indignation on Twitter. Senator Feinstein's unpardonable offense is that she became impatient with being repeatedly interrupted and made a few sarcastic remarks having to do with her knowledge, experience and authority and their lack of those characteristics.
I don't buy Feinstein's rationale for her policy positions on climate change but that isn't what this post is about. Just in the past month there have been three viral outrage epidemics: the Covington sneering kid standoff, the Jussie Smollett assault/hoax and now the Weinstein virtual stoning. Meanwhile there all these transient trending episodes involving billionaires, celebrities, politicians and pedophiles (not to mention "all of the above"). Then there was the Ilhan Omar trope crisis and the Governor Northam blackface controversy and on and on it goes. Are we having fun yet?
What all this nonsense reminds me of is the Indian Ocean tsunami of December 26, 2004. In those days, I was in a dialogue group that met once a month and at our next session after the tsunami, we shared a common impression of some kind of global convergence. Something that had never happened before. People around the world brought together by the sheer magnitude of the tragedy. The universal sublime.
What happened next will make your jaw hit the floor. Nearly one year after the Indian Ocean tsunami, December 15, 2005 YouTube was officially launched. According to YouTube founder Jawed Karim one of the inspirations for YouTube was... the Indian Ocean Tsunami. The other inspiration was Janet Jackson's Super Bowl "wardrobe malfunction." From the sublime to the ridiculous, indeed.
On July 15, 2006 Twitter was launched publicly and Facebook followed on September 26 of the same year. The "paranoid style" and conspiracy theories have been around for centuries and shock jock and outrage radio for about as long as there has been radio. But it seems as though social media has added a new dimension of dementia. Following up on Roger Stone's posting of a menacing image of Judge Amy Berman Jackson led me to a rabbit hole blog and YouTube channel where some entrepreneur who claims to have invented Facebook spins a conspiracy matrix that makes the late, lamented Lyndon LaRouche sound like David S. Broder.
One may surmise that all of these cockroaches were there all along, we just didn't see them until the social media apps tore off the drywall. On the other hand, before YouTube or Twitter, they didn't have 65,000 "subscribers" or 58.5 million "followers." What may fade into the background amidst the sound and fury of all the idiots' tales is that these social media platforms are businesses. Their business models are founded on the hypothetically exponential growth of scandal-and-spectacle-as-vehicle-for-skip-ads when the actual growth curve is logistic. I suspect we're in the Ponzi phase of the cycle and all this bullshit is about ready to hit the fan.
I don't buy Feinstein's rationale for her policy positions on climate change but that isn't what this post is about. Just in the past month there have been three viral outrage epidemics: the Covington sneering kid standoff, the Jussie Smollett assault/hoax and now the Weinstein virtual stoning. Meanwhile there all these transient trending episodes involving billionaires, celebrities, politicians and pedophiles (not to mention "all of the above"). Then there was the Ilhan Omar trope crisis and the Governor Northam blackface controversy and on and on it goes. Are we having fun yet?
What all this nonsense reminds me of is the Indian Ocean tsunami of December 26, 2004. In those days, I was in a dialogue group that met once a month and at our next session after the tsunami, we shared a common impression of some kind of global convergence. Something that had never happened before. People around the world brought together by the sheer magnitude of the tragedy. The universal sublime.
What happened next will make your jaw hit the floor. Nearly one year after the Indian Ocean tsunami, December 15, 2005 YouTube was officially launched. According to YouTube founder Jawed Karim one of the inspirations for YouTube was... the Indian Ocean Tsunami. The other inspiration was Janet Jackson's Super Bowl "wardrobe malfunction." From the sublime to the ridiculous, indeed.
On July 15, 2006 Twitter was launched publicly and Facebook followed on September 26 of the same year. The "paranoid style" and conspiracy theories have been around for centuries and shock jock and outrage radio for about as long as there has been radio. But it seems as though social media has added a new dimension of dementia. Following up on Roger Stone's posting of a menacing image of Judge Amy Berman Jackson led me to a rabbit hole blog and YouTube channel where some entrepreneur who claims to have invented Facebook spins a conspiracy matrix that makes the late, lamented Lyndon LaRouche sound like David S. Broder.
One may surmise that all of these cockroaches were there all along, we just didn't see them until the social media apps tore off the drywall. On the other hand, before YouTube or Twitter, they didn't have 65,000 "subscribers" or 58.5 million "followers." What may fade into the background amidst the sound and fury of all the idiots' tales is that these social media platforms are businesses. Their business models are founded on the hypothetically exponential growth of scandal-and-spectacle-as-vehicle-for-skip-ads when the actual growth curve is logistic. I suspect we're in the Ponzi phase of the cycle and all this bullshit is about ready to hit the fan.
Netanyahu Sinking
While the wise and up-to-date observers declare the two state solution between Israel and Palestine to be deader than dead, I continue to think that morally it is the best solution for this deeeply difficult problem. However, one leading force in sending this solution into the grave is Binyamin Netanyahu, Israel's prime minister, who is up for reelection very shortly. He has for some time been pushing the situation towards a hard nationalist one state solution, with the current Trump admin supporting his worst impulses. But in the last few dayys as the electiion approaches, Netanyahu has made seriously disturbing moves that promise longer tern injustice and instability.
The first of those is his decision to ally with Otzma Jehudit, a political party descended from the terrorist Kahane group. Really, the Kahanists have been officially labeled a terrorist group by the US government and in the past have killed lots of people, including in the US. They are so bad that even AIPAC has criticized Netanyahu for allying with him in this tight election campaign, although I have no doubt that if he wins they will be back supporting him big and full time.
The other development that I read on Juan Cole's blog is ptentially far more serious and dangeous. Within the last few days, supposedly spontaneous Israeli West Bank settler activists have halted Muslims from accessing the al-Aqsa mosque. This has involved both attacking people trying to get near it as well as illeglly chaining the gate to the area around it. This has received in the US near zero coverage, but this could lead to World War III (or are we on IV?).
Mallik Salman bin Abdulaziz bin Abdul-Rahman al-Sa'ud, the King of Saudi Arabia, whose most prestigious title is that he is the Protector of the Holy Sites (Mecca and Medina) could claim to be the Caliph of Islam if he controlled as did the Ottoman Sultans all three of the most holy sites of Islam. His father, the founder of the modern Kingdom of Saudi Arabia, Abdulaziz (aka "Ibn Saud"), did not claim the Caliphate precisely because while had two of them under his control after he pushed the Hashemites out in 1924, he did not control the third, the al-Aqsa mosque in Jerusalem (al-Quds in Arabic), then controlled by the British, That Netanyahu would allow keeping Muslims from visitng this third most holy site in all Islam threatens world religious war.
I (not alone) have long aruged that the most hotly contest piece of land on this planet is a small square known in English in the US as the "Temple Mount," following Jewish and Christian views of it, while it is known in Arabic as the Haram-es-Sharif, the Holy Place. The earlist Biblical refeence to this site on its high spot is to when reportedly Abraham visited Jerusalem and had friendly dealings with then High Priest Melchizedek. His temple was reportedly on a more sensitive spot in that enclosure than the al-Aqsa mosque, the later central site of the Hebrew/Jewish temple, which the Romans destroyed in 70 CE after the locals uprose against their rule.
The building now on this long revered spot is the Dome of the Rock, not quiite as holy in Islam as the al-Aqsa mosque a few feet away from it, but the most beautiful building in Jerusalem. Not only does the gorgeous Dome of the Rock (al Aqsa and the Christian Church of the Holy Sepulchre not on this mount but not too far away, are both just ugly by comparison) it on the center of Melchizidek's temple and the old Hebrew/Jewish temple, but in Islam it is where supposedly the Prophet Muhammed ascended into heaven for a major confab, as well as containing rock formations where the souls of those who die pass before going on to final judgment. Its interior art is fabulously beautiful. I saw it in 1997 when I firsr visited this contested site, then under the official jurisdiction of the late King Hussein of Jordan, although in 2017 when I took my wife, Marina, there non-Muslims were no longer allowed inside the Dome of the Rock, although we were able to wander around its extrerior, taking photos.
But now Netanyahu is allowing settler activists to prevent Muslims from even entering the general site (directly above the Western "Wailing" Wall of the Jews on the lower west side of the former temple) to even get near either the officially more holy al-Aqsa mosque or its more beautiful neighbor, the Dome of the Rock. This act is completely unacceptable and threatens serious violence and war.
Barkley Rosser
The first of those is his decision to ally with Otzma Jehudit, a political party descended from the terrorist Kahane group. Really, the Kahanists have been officially labeled a terrorist group by the US government and in the past have killed lots of people, including in the US. They are so bad that even AIPAC has criticized Netanyahu for allying with him in this tight election campaign, although I have no doubt that if he wins they will be back supporting him big and full time.
The other development that I read on Juan Cole's blog is ptentially far more serious and dangeous. Within the last few days, supposedly spontaneous Israeli West Bank settler activists have halted Muslims from accessing the al-Aqsa mosque. This has involved both attacking people trying to get near it as well as illeglly chaining the gate to the area around it. This has received in the US near zero coverage, but this could lead to World War III (or are we on IV?).
Mallik Salman bin Abdulaziz bin Abdul-Rahman al-Sa'ud, the King of Saudi Arabia, whose most prestigious title is that he is the Protector of the Holy Sites (Mecca and Medina) could claim to be the Caliph of Islam if he controlled as did the Ottoman Sultans all three of the most holy sites of Islam. His father, the founder of the modern Kingdom of Saudi Arabia, Abdulaziz (aka "Ibn Saud"), did not claim the Caliphate precisely because while had two of them under his control after he pushed the Hashemites out in 1924, he did not control the third, the al-Aqsa mosque in Jerusalem (al-Quds in Arabic), then controlled by the British, That Netanyahu would allow keeping Muslims from visitng this third most holy site in all Islam threatens world religious war.
I (not alone) have long aruged that the most hotly contest piece of land on this planet is a small square known in English in the US as the "Temple Mount," following Jewish and Christian views of it, while it is known in Arabic as the Haram-es-Sharif, the Holy Place. The earlist Biblical refeence to this site on its high spot is to when reportedly Abraham visited Jerusalem and had friendly dealings with then High Priest Melchizedek. His temple was reportedly on a more sensitive spot in that enclosure than the al-Aqsa mosque, the later central site of the Hebrew/Jewish temple, which the Romans destroyed in 70 CE after the locals uprose against their rule.
The building now on this long revered spot is the Dome of the Rock, not quiite as holy in Islam as the al-Aqsa mosque a few feet away from it, but the most beautiful building in Jerusalem. Not only does the gorgeous Dome of the Rock (al Aqsa and the Christian Church of the Holy Sepulchre not on this mount but not too far away, are both just ugly by comparison) it on the center of Melchizidek's temple and the old Hebrew/Jewish temple, but in Islam it is where supposedly the Prophet Muhammed ascended into heaven for a major confab, as well as containing rock formations where the souls of those who die pass before going on to final judgment. Its interior art is fabulously beautiful. I saw it in 1997 when I firsr visited this contested site, then under the official jurisdiction of the late King Hussein of Jordan, although in 2017 when I took my wife, Marina, there non-Muslims were no longer allowed inside the Dome of the Rock, although we were able to wander around its extrerior, taking photos.
But now Netanyahu is allowing settler activists to prevent Muslims from even entering the general site (directly above the Western "Wailing" Wall of the Jews on the lower west side of the former temple) to even get near either the officially more holy al-Aqsa mosque or its more beautiful neighbor, the Dome of the Rock. This act is completely unacceptable and threatens serious violence and war.
Barkley Rosser
Wednesday, February 20, 2019
The Black Bill and the Green New Deal
"When we first came to Washington in 1933," FDR Labor Secretary Francis Perkins wrote in her memoir, The Roosevelt I Knew, "the Black bill was already before the Congress. Introduced by Senator Hugo L. Black, it had received support from many parts of the country and from many representatives and senators."
The Black Bill was the Senate version of the Black-Connery Thirty-Hour Bill. On April 6, 1933, the Senate approved the measure by a vote of 53 to 30. Perkins was scheduled to appear before the House committee holding hearings on the Connery Bill:
Roosevelt had a problem. He was in favor of limiting the hours of labor for humanitarian and possibly for economic reasons and therefore did not want to oppose the bill. At the same time, he did not feel that it was sound to support it vigorously. But the agitation for the bill was strong. Its proponent insisted that it was a vital step toward licking the depression. I said, "Mr. President, we have to take a position. I'll take the position, but I want to be sure that it is in harmony with your principles and policy."Roosevelt had another problem. The National Association of Manufacturers and the Chamber of Commerce were adamantly opposed to the Thirty-Hour Bill. Perkins offered amendments to the Connery Bill, the American Federation of Labor offered other amendments and business representatives "proposed crippling amendments that would have destroyed the purpose of the measure."
On May 1, the administration withdrew its support for the Connery Bill. Roosevelt had concluded that organized business would not support the recovery program if the Black-Connery Bill were to become law. In its place, the collective bargaining provisions of Section 7(a) and wage, hour and labor standard provisions were added to the National Industrial Recovery Act through, in Leon Keyserling's account, "a series of haphazard accidents reflecting the desire to get rid of the Black bill and to put something in to satisfy labor."
The Supreme Court ruled the Recovery Act unconstitutional on May 27, 1935. In its place, the "Second New Deal" consisted of a variety of policies, including, most notably, the National Labor Relations Act, the Works Progress Administration and Social Security.
The moral to the story is that "the" New Deal was improvised, it evolved, was not unitary and its original impetus came from a fundamentally different policy proposal that was anathema to the business lobby. The Thirty-Hour Bill was conceived as a solution to a problem that is no longer polite in policy circles to consider as a problem -- "over-production."
I am sympathetic to the intentions and ambition of the Green New Deal resolution proposed by U.S. Representative Alexandria Ocasio-Cortez and Senator Ed Markey. What I find especially compelling is the inclusion of social and economic justice and equality in the program goals. The vision isn't just a proposal for "sustainable" business-as-usual, powered by wind and solar.
The day before Ocasio-Cortez and Markey announced their resolution, Kate Aronoff and co-authors presented a "Five Freedoms" statement of principles for a Green New Deal, modeled on Franklin Roosevelt's Four Freedoms.from 1941. My favorite, of course, is number two: Freedom From Toil:
We can’t escape work altogether, and there’s a lot of work we need to do, immediately and in the long term. But work doesn’t need to rule our lives.
The great nineteenth-century English socialist William Morris made a distinction between useful work and useless toil: we need the former but should free ourselves from the latter. We can escape the crushing toll of working long hours for low wages to make something that someone else owns.
At present, there’s a lot of work that’s worse than useless — it’s toil that’s harmful to the people doing it and to the world in which we live. But even useful work should be distributed more widely so that we can all do less of it — and spend more time enjoying its fruits.I suppose there always has been work that is "worse than useless" -- bullshit jobs and all that. But there is cruel irony in the fact that the ultimate solution to the 1930s problem of over-production was perpetual creation of useless toil through credit, fashion, advertising, and government stimulus and subsidies. The original proposal had been... shorter working time!
Which brings me back to the peregrinations of the FDR New Deal. The 12-year deadline posited by the I.P.C.C. for keeping within the 1.5 degree centigrade limit brings us to the 100th anniversary of Keynes's "Economic Possibilities For Our Grandchildren." Time has run out on his caveat:
But beware! The time for all this is not yet. For at least another hundred years we must pretend to ourselves and to every one that fair is foul and foul is fair; for foul is useful and fair is not. Avarice and usury and precaution must be our gods for a little longer still. For only they can lead us out of the tunnel of economic necessity into daylight.We have been pretending long enough now for foul to become worse than useless and to convince ourselves that fair really would be foul. It is past time to stop pretending.
Sunday, February 17, 2019
Nonsense on Stilted Language: A Review of Nine Pages of Michelle Murphy’s "The Economization of LIfe"
I’m a professor at Evergreen State College. This year I assigned a new-ish book I hadn’t yet read to my class, and to my chagrin I discovered it was pseudo-scholarship instead of the real thing; so I wrote the following apologia.
UPDATE: Problems like the ones I identified in Murphy’s book are not simply individual shortcomings. I addressed my critique to a particular book and author, but it’s clear the problems are more widespread. Murphy draws on the work of other writers like herself, her manuscript was reviewed by other “scholars” in her field, and since its publication it has been frequently cited as an authoritative source. More broadly, Murphy holds a tenured professorship at a well-established university and directs a research institute. She is held in esteem by her peers. Thus, pseudo-scholarship of the type I describe should not be considered a rogue, individual failing but a normal attribute of a substantial swath of academia.
To continue the analogy I offer in the review, the social problem posed by “fake news” is not that a particular journalist or blogger made up something, but that a large and well-funded industry exists to provide an ecosystem for the production and circulation of “facts” without concern for their actual facticity. Similarly the discipline of which Murphy is a part. Economists should be aware that universities are stocked with professors who believe that economics denies the value of anything excluded from national income accounting and that macroeconomic policy has its roots in colonial domination. They know these things because the academic books and articles they read say them, citing each other as sources.
You can’t go through life always worrying about what others think of you, but you can’t entirely ignore it either.
UPDATE: Problems like the ones I identified in Murphy’s book are not simply individual shortcomings. I addressed my critique to a particular book and author, but it’s clear the problems are more widespread. Murphy draws on the work of other writers like herself, her manuscript was reviewed by other “scholars” in her field, and since its publication it has been frequently cited as an authoritative source. More broadly, Murphy holds a tenured professorship at a well-established university and directs a research institute. She is held in esteem by her peers. Thus, pseudo-scholarship of the type I describe should not be considered a rogue, individual failing but a normal attribute of a substantial swath of academia.
To continue the analogy I offer in the review, the social problem posed by “fake news” is not that a particular journalist or blogger made up something, but that a large and well-funded industry exists to provide an ecosystem for the production and circulation of “facts” without concern for their actual facticity. Similarly the discipline of which Murphy is a part. Economists should be aware that universities are stocked with professors who believe that economics denies the value of anything excluded from national income accounting and that macroeconomic policy has its roots in colonial domination. They know these things because the academic books and articles they read say them, citing each other as sources.
You can’t go through life always worrying about what others think of you, but you can’t entirely ignore it either.
Saturday, February 16, 2019
Another Question for the Census
The Trump gang has kicked up a ruckus over its plan to insert a question about citizenship in the 2020 decennial census. It’s a transparent attempt to reduce the response rate of immigrants, disenfranchising them in reapportionment and government spending formulas, despite the Constitution’s call for an enumeration of “persons”, not citizens.
But why stop at citizenship? When you think about, there is no government interest greater than its ability to collect taxes, the main obstacle to which is tax avoidance, legal and illegal. Researchers looking into this problem, not to mention government analysts themselves, struggle in the face of rampant secrecy.
So why not use the census to get a better picture of tax cheating? Insert just a single question, “Within the past year have you failed to pay your lawful federal, state or local tax obligations?” Respondents should be reminded that a dishonest answer constitutes a violation of federal law. The fine is small compared to most tax avoidance, but the last thing most tax scofflaws want is added attention to their financial duplicity.
I can see the confusion when the numbers are tallied in 2021. “Gee, there are all these big houses, shady streets and golf courses, but according to our data no one actually lives here.”
But why stop at citizenship? When you think about, there is no government interest greater than its ability to collect taxes, the main obstacle to which is tax avoidance, legal and illegal. Researchers looking into this problem, not to mention government analysts themselves, struggle in the face of rampant secrecy.
So why not use the census to get a better picture of tax cheating? Insert just a single question, “Within the past year have you failed to pay your lawful federal, state or local tax obligations?” Respondents should be reminded that a dishonest answer constitutes a violation of federal law. The fine is small compared to most tax avoidance, but the last thing most tax scofflaws want is added attention to their financial duplicity.
I can see the confusion when the numbers are tallied in 2021. “Gee, there are all these big houses, shady streets and golf courses, but according to our data no one actually lives here.”
Thursday, February 14, 2019
Who Is Really A Socialist?
Here are some varieties of "socialism:" command socialism, market socialism, socialist market economy, social democracy, democratic socialism, right wing socialism, utopian socialism, corporate socialism, just plain vanilla socialism. Here are some people who have claimed to be socialist, some of them selecting one or another of these types, but some just keeping it plain vanilla generic: Kim Jong-Un, Xi Jinping, Stefan Lofven, Nicolas Maduro, Bernie Sanders, Aexandria Ocasio-Cortez (AOC). Who is really a socialist and can we make any sense of all this?
Among the strictly economic issues involved here, aside from the political ones, there are three that stick out prominently: ownership, allocation, and distribution. The first may be the most important, or at least the most fundamentally traditionally classical: who owns the means of production? This is bottom line Marx and Engels, and they were unequivocal: socialism is state ownership of the means of production, even though in the "hiigher stage of socialism" generally labeled "pure communism," the statte is supposed to "wither away." Capitalism is private ownership of the means of production, although there are debates over some intermediate collective forms such as worker-owned collectives, something favored by anarchistic and utopian socialism and its offshoots and relatives.
Regarding allocation the issue is command versus market, wiith command in its socialist form coming from the state, although clearly a monopoly capitalist system may involve command coming from the large corporations, with this reaching an extreme form in coeporatism and classical fascism, sometimes called corporate socialism. Needless to say, it is possible to have state ownership of the means of production, classical socialism, but some degree of markets dominating allocative decisions.
Then we have distribution. In the Critique of the Gotha Program, Marx said the goal of communism was "from each acording to his ability, to each according to his need." Emphasizing if not precisely that at least a focus on minimizing poverty and supporting those in need as well as increasing the overall level of income and wealth equality is another element of many forms of socialism. This focus has been especially strongly emphasized by social democracy and its relatives, although most forms of socialism have at least officially supported this, if not always in practice.
Regarding our list of socialisms, where do they stand on these three, adding in the big political issue of democracy and free rights versus dictatorship, well: command socialism involves as its name suggests both command in terms of allocation combined with state ownership of the means of production, with no clear outcome on distributional view. Historically permanent command as a system has coincided fully with dictatorship, including when this occurs with capitalism as in fascism, especiallly in its German Nazi form, a nearly pure form of command capitalism. The classic model of this form was the USSR under Stalin, with its leading current example being the Democratic Peoples' Republic of Korea (DPRK), aka North Korea, which pretty much tells us what kind of socialist Kim Jong-Un is.
Market socialism combines state (or collective) ownership of the means of production with market forces driving allocation decisions. The old example of this that also had that holdover from utopian socialism of workers' management, was Tito's not-so democratic Yugoslavia, which blew up, although its former provincce of Slovenia eventually was the highest real per capit income of all the former officially socialist nations. According to Janos Kornai, market socialism, including his home of Hungary, suffered from the problem of the soft budget constraint, although we have seen that in many mostly market capitalist economies with rent seeking powerful corporations.
There is no clear difference between market socislism and the "socialist market economy," but the Peoples' Republic of China (PRC) has gone out of its way to officially label itself this latter term, perhaps due to the collapse of Yugoslavia. Many, including the late Ronald Coase, claim China is really capitalist, but in fact while there is now much private ownership, state ownership remains very strong, and while there is no longer organized cental planning, command elements remain important, and the ownership situation is very complicated, with many firms having substantial while partial state ownership. In principle this form could be democtatic, but it is not at all that in Xi's current PRC, which has had a largely successful economic system for the last four decades, despite high inequality and other problems. In any case, this is the system Xi Jinping is identified with.
Social democracy now is the form that emphasizes distributional equality and support for the poor over the ownership and alllocation elements. This is now, most dramatically in the Nordic nations, although it has had a weaker version in Germany in the form of the social market economy. The name "social democracy" comes from the now century and a half old German Social Democratic Party, within which at the end of the 19th century several of these forms debated with each other, although in the end what came out, inspired by the original "revisionist" Eduard Bernstein, was what we now call social democracy, which is indeed politically democratic and supporting an expansive welfare state, while not pushing either state ownership or command. Stefan Lofven is the current prime minister of Sweden and also leader of the Social Democratic Party of Sweden. A welder and union leader, Lofven just managed to get reelected and form another government last month, although his new government is "moving to the center," and while he is certainly a social democrat, he has also described himself as being a "right wing socialist," and Sweden has pulled back somewhat from its strongly social democratic model over the last quarter of a century.
Which brings us to democratic socialism, currently highly faddish in the US given that both Bernie Sanders and AOC have identified themselves as followers of this ideology. The problem is that of all the others mentioned, this one is the least well defined, and Bernie and AOC themselves seem to disagree. Thus when pushed Bernie posed Denmark as his model, which is a leading example of social democracy, arguably more so even than Sweden now, although its current prime minister is not a Social Democrat (party) and argues that Denmark is "not socialist" (noting its lack of command state ownership). But AOC has at times said that democratic socialism is not social democracy, while exactly what it is remaiins not well defined.
One source might be the platform of the Democratic Socialists of America (DSA), which AOC officially belongs to. This supports a democratic and decentralized form that emphasizes worker control, if not clearly ownership, with this harking to utopian socialism, with an ultimate goal of state or some other form of collective ownership, but not in this document command. AOC herself has now pushed forward the Green New Deal, (GND) which should perhaps be labeled "Green Socialism," yet another form. I do not wish to get into a discusson in this post of the details of the GND, regarding which there has been some confusion (retracted FAQ versus 14 page Resolution) about which there remain some uncertainties. DSA has at times nodded to the British Labour Party, which after 1945 under Clement Atlee, both nationalized many industries while expanding the social safety net, while avoiding command central planning. However, the GND seems to avoid nationalizations, while emphasizing a major expansion of rhe social safety net, along with some fairly strong command elements laregely tied to its Green environmental part, arguing that mere market forces will be insufficient to move the US economy off its current fossil fuel base soon enough.
Which brings us to generic socialism and the still not described Nicolas Maduro, President of Venezuela. He is loudly describing himself a socialist, but what form, if any, is unclear. But his economy is the biggest current economic disaster on the planet, so his ongoing claims of being a socialist are damaging the label, as seen in the eagerness of conservatives to identify socialism with him and denounce people like Bernie and AOC and all the Dem prez candidates signing onto the GND even before they knew what was in it, with this exemplified by Trump ranting loudly on this theme during his SOTU.
Looking closely it seems that indeed Maduro and Chavez before him, who preferred labeling the system "Bolivarianismo" rathet than "socialism," did carry out portions of various of the forms of socialism. Many firms were narionalized, with currently the number of privately owned firms about half of what there were 20 years ago (when Chavez was elected), although many of those original firms have simply disappeared. About 20% of farmland was nationalized, mostly large-scale latifundia, supposedly to be turned over to landless peasants. But much of it has simply come to be uncultivated by anybody. In any case, there remain large portions of the economy privately owned, with still wealthy owners living in gated communities and not suffering.
Perhaps the most damaging of the socialist policies have been scattered efforts at command, not based on any central plan, especially using price control. In agriculture this has been a complete disaster, especially once hyperinflation hit. Food production has collapsed, and lack of food has driven 3 million out of the country, with many still behind having lost much weight. OTOH, the regime is supposedly being green by emphasizing traditonal local crops. But this is not even a joke. Bolivarianismo's main positive was its popular redistribution policy, which increased real incomes in poor areas, especially while Chavez was in power, borrowing from the social democracy model.
The problem here is that all of these things, even many oof them together, have been recently tried in neighboring nations, such as Bolivia, without simialrly disastrous results. Somehow Venezuela has just completely blown apart, with reportedly 86% of the population now opposed to Maduro and people in the poor neighborhoods of Caracas who were the Chavismo base now out demonstrating in large numbers (and being violently suppressed) after Maduro got reelected in a clearly fraudulent election, with most of his neighbors calling for his removal.
I think two things not related specifically to socialism have played crucial roles here: corruption and hyperinflation. The most important agent in the Venezuelan economy is the state-owned oil company, which was nationalized long before Chavez came to power. But he, with Maduro made this worse later, fiirng the competent technocratic managers of that company and replacing them with political cronies, with the outcome being a serious decline in oil production, this in the nation with the world's largest oil reserves. Which leads to the other problem, massive corruption, with the incompetent cronies at the top of the state-owned oil company the worst. The other killer item has been the hyperinflation, whose source I do not really know, although Venezuelan tax rates are lower than those in the US. Certainly part of it is massive budget deficits, and as the MMT people note, they were borrowing from abroad. I do not fully understand all involved in the hyperinflation, although that is not a standard phenomenon in a full-blown command socialist economy, but the hyperinflation has clearly been the final killer of the economy, collapsing support for Maduro. Apparently about a third of the population still supports "socialism," while many of those people reject Maduro, claiming he has blown what Chavez implemented, which Maduro certainly has.
So, for a summary. Command socialims a la the DPRK is an awful diasster, famine plus dictatorshiip. Market socialism/socialist market economy a la China has been good at rapid economic growth and much else, although suffering many ills on the environment and income distribution, not to mention alo being dictatorial. Social democracy a la Swden and Denmark has done as well as any economic system on the planet and is democractic and free, but has also suffered from various problems. The "democratic socialsim" of certain American politicians remains poorly defined and is in danger of being tied to the disastrous and vaguer form of "socialism" happening in Venezuela, with the danger for US politics being that conservatives may actually succeed in tying this pooerly defined democratic socialism with the barely socialist disaster in Venezuela.
Personally, I wish that Maduro would stop calling himself a socialist. Then he should also resign and get lost for the good of his people ASAP, although I do not support overdone US efforts by sanctions or possible invasion to bring this about. Let it be the Venezuelan people who remove him, however.
Barkley Rosser
Among the strictly economic issues involved here, aside from the political ones, there are three that stick out prominently: ownership, allocation, and distribution. The first may be the most important, or at least the most fundamentally traditionally classical: who owns the means of production? This is bottom line Marx and Engels, and they were unequivocal: socialism is state ownership of the means of production, even though in the "hiigher stage of socialism" generally labeled "pure communism," the statte is supposed to "wither away." Capitalism is private ownership of the means of production, although there are debates over some intermediate collective forms such as worker-owned collectives, something favored by anarchistic and utopian socialism and its offshoots and relatives.
Regarding allocation the issue is command versus market, wiith command in its socialist form coming from the state, although clearly a monopoly capitalist system may involve command coming from the large corporations, with this reaching an extreme form in coeporatism and classical fascism, sometimes called corporate socialism. Needless to say, it is possible to have state ownership of the means of production, classical socialism, but some degree of markets dominating allocative decisions.
Then we have distribution. In the Critique of the Gotha Program, Marx said the goal of communism was "from each acording to his ability, to each according to his need." Emphasizing if not precisely that at least a focus on minimizing poverty and supporting those in need as well as increasing the overall level of income and wealth equality is another element of many forms of socialism. This focus has been especially strongly emphasized by social democracy and its relatives, although most forms of socialism have at least officially supported this, if not always in practice.
Regarding our list of socialisms, where do they stand on these three, adding in the big political issue of democracy and free rights versus dictatorship, well: command socialism involves as its name suggests both command in terms of allocation combined with state ownership of the means of production, with no clear outcome on distributional view. Historically permanent command as a system has coincided fully with dictatorship, including when this occurs with capitalism as in fascism, especiallly in its German Nazi form, a nearly pure form of command capitalism. The classic model of this form was the USSR under Stalin, with its leading current example being the Democratic Peoples' Republic of Korea (DPRK), aka North Korea, which pretty much tells us what kind of socialist Kim Jong-Un is.
Market socialism combines state (or collective) ownership of the means of production with market forces driving allocation decisions. The old example of this that also had that holdover from utopian socialism of workers' management, was Tito's not-so democratic Yugoslavia, which blew up, although its former provincce of Slovenia eventually was the highest real per capit income of all the former officially socialist nations. According to Janos Kornai, market socialism, including his home of Hungary, suffered from the problem of the soft budget constraint, although we have seen that in many mostly market capitalist economies with rent seeking powerful corporations.
There is no clear difference between market socislism and the "socialist market economy," but the Peoples' Republic of China (PRC) has gone out of its way to officially label itself this latter term, perhaps due to the collapse of Yugoslavia. Many, including the late Ronald Coase, claim China is really capitalist, but in fact while there is now much private ownership, state ownership remains very strong, and while there is no longer organized cental planning, command elements remain important, and the ownership situation is very complicated, with many firms having substantial while partial state ownership. In principle this form could be democtatic, but it is not at all that in Xi's current PRC, which has had a largely successful economic system for the last four decades, despite high inequality and other problems. In any case, this is the system Xi Jinping is identified with.
Social democracy now is the form that emphasizes distributional equality and support for the poor over the ownership and alllocation elements. This is now, most dramatically in the Nordic nations, although it has had a weaker version in Germany in the form of the social market economy. The name "social democracy" comes from the now century and a half old German Social Democratic Party, within which at the end of the 19th century several of these forms debated with each other, although in the end what came out, inspired by the original "revisionist" Eduard Bernstein, was what we now call social democracy, which is indeed politically democratic and supporting an expansive welfare state, while not pushing either state ownership or command. Stefan Lofven is the current prime minister of Sweden and also leader of the Social Democratic Party of Sweden. A welder and union leader, Lofven just managed to get reelected and form another government last month, although his new government is "moving to the center," and while he is certainly a social democrat, he has also described himself as being a "right wing socialist," and Sweden has pulled back somewhat from its strongly social democratic model over the last quarter of a century.
Which brings us to democratic socialism, currently highly faddish in the US given that both Bernie Sanders and AOC have identified themselves as followers of this ideology. The problem is that of all the others mentioned, this one is the least well defined, and Bernie and AOC themselves seem to disagree. Thus when pushed Bernie posed Denmark as his model, which is a leading example of social democracy, arguably more so even than Sweden now, although its current prime minister is not a Social Democrat (party) and argues that Denmark is "not socialist" (noting its lack of command state ownership). But AOC has at times said that democratic socialism is not social democracy, while exactly what it is remaiins not well defined.
One source might be the platform of the Democratic Socialists of America (DSA), which AOC officially belongs to. This supports a democratic and decentralized form that emphasizes worker control, if not clearly ownership, with this harking to utopian socialism, with an ultimate goal of state or some other form of collective ownership, but not in this document command. AOC herself has now pushed forward the Green New Deal, (GND) which should perhaps be labeled "Green Socialism," yet another form. I do not wish to get into a discusson in this post of the details of the GND, regarding which there has been some confusion (retracted FAQ versus 14 page Resolution) about which there remain some uncertainties. DSA has at times nodded to the British Labour Party, which after 1945 under Clement Atlee, both nationalized many industries while expanding the social safety net, while avoiding command central planning. However, the GND seems to avoid nationalizations, while emphasizing a major expansion of rhe social safety net, along with some fairly strong command elements laregely tied to its Green environmental part, arguing that mere market forces will be insufficient to move the US economy off its current fossil fuel base soon enough.
Which brings us to generic socialism and the still not described Nicolas Maduro, President of Venezuela. He is loudly describing himself a socialist, but what form, if any, is unclear. But his economy is the biggest current economic disaster on the planet, so his ongoing claims of being a socialist are damaging the label, as seen in the eagerness of conservatives to identify socialism with him and denounce people like Bernie and AOC and all the Dem prez candidates signing onto the GND even before they knew what was in it, with this exemplified by Trump ranting loudly on this theme during his SOTU.
Looking closely it seems that indeed Maduro and Chavez before him, who preferred labeling the system "Bolivarianismo" rathet than "socialism," did carry out portions of various of the forms of socialism. Many firms were narionalized, with currently the number of privately owned firms about half of what there were 20 years ago (when Chavez was elected), although many of those original firms have simply disappeared. About 20% of farmland was nationalized, mostly large-scale latifundia, supposedly to be turned over to landless peasants. But much of it has simply come to be uncultivated by anybody. In any case, there remain large portions of the economy privately owned, with still wealthy owners living in gated communities and not suffering.
Perhaps the most damaging of the socialist policies have been scattered efforts at command, not based on any central plan, especially using price control. In agriculture this has been a complete disaster, especially once hyperinflation hit. Food production has collapsed, and lack of food has driven 3 million out of the country, with many still behind having lost much weight. OTOH, the regime is supposedly being green by emphasizing traditonal local crops. But this is not even a joke. Bolivarianismo's main positive was its popular redistribution policy, which increased real incomes in poor areas, especially while Chavez was in power, borrowing from the social democracy model.
The problem here is that all of these things, even many oof them together, have been recently tried in neighboring nations, such as Bolivia, without simialrly disastrous results. Somehow Venezuela has just completely blown apart, with reportedly 86% of the population now opposed to Maduro and people in the poor neighborhoods of Caracas who were the Chavismo base now out demonstrating in large numbers (and being violently suppressed) after Maduro got reelected in a clearly fraudulent election, with most of his neighbors calling for his removal.
I think two things not related specifically to socialism have played crucial roles here: corruption and hyperinflation. The most important agent in the Venezuelan economy is the state-owned oil company, which was nationalized long before Chavez came to power. But he, with Maduro made this worse later, fiirng the competent technocratic managers of that company and replacing them with political cronies, with the outcome being a serious decline in oil production, this in the nation with the world's largest oil reserves. Which leads to the other problem, massive corruption, with the incompetent cronies at the top of the state-owned oil company the worst. The other killer item has been the hyperinflation, whose source I do not really know, although Venezuelan tax rates are lower than those in the US. Certainly part of it is massive budget deficits, and as the MMT people note, they were borrowing from abroad. I do not fully understand all involved in the hyperinflation, although that is not a standard phenomenon in a full-blown command socialist economy, but the hyperinflation has clearly been the final killer of the economy, collapsing support for Maduro. Apparently about a third of the population still supports "socialism," while many of those people reject Maduro, claiming he has blown what Chavez implemented, which Maduro certainly has.
So, for a summary. Command socialims a la the DPRK is an awful diasster, famine plus dictatorshiip. Market socialism/socialist market economy a la China has been good at rapid economic growth and much else, although suffering many ills on the environment and income distribution, not to mention alo being dictatorial. Social democracy a la Swden and Denmark has done as well as any economic system on the planet and is democractic and free, but has also suffered from various problems. The "democratic socialsim" of certain American politicians remains poorly defined and is in danger of being tied to the disastrous and vaguer form of "socialism" happening in Venezuela, with the danger for US politics being that conservatives may actually succeed in tying this pooerly defined democratic socialism with the barely socialist disaster in Venezuela.
Personally, I wish that Maduro would stop calling himself a socialist. Then he should also resign and get lost for the good of his people ASAP, although I do not support overdone US efforts by sanctions or possible invasion to bring this about. Let it be the Venezuelan people who remove him, however.
Barkley Rosser
Wednesday, February 13, 2019
Test Tube Politics: llhan Omar, Anti-Semitism and AIPAC
I don’t think I’ve ever seen a political statement triggering evidence (mixed) about its own truth as dramatically as Ilhan Omar’s quip that pro-Israeli bias in congress is “about the Benjamins, baby”. It’s as if you wrote a letter criticizing the Post Office and had it returned to you with a USPS message stamped on it.
But let’s dig down one level. The criticism, partly fair, of Omar is that she bought into (so to speak) the anti-semitic slur that Jewish money constitutes a secret conspiracy against “the people”. This is the old socialism-of-fools stuff, endlessly recycled by bigots right up until this morning; see the demonization of George Soros, for instance. Because it exists, people who want to combat bigotry—and this includes progressive politicians—should build a giant moat around it and not go there. By suggesting that hidden Jewish money had bribed Congress into blind support for Israel, Omar crossed a line. It’s the same line that George Bush senior crossed with the Willie Horton ad, and that Trump crosses a dozen times every Twitter-soaked evening. Invoking a bigoted stereotype is a bad thing to do, especially for politicians with giant megaphones.
Yet the very response to Omar’s tweet demonstrated the truth she was stumbling for. A chorus of political and media honchos of every denomination, religious and political, rose up to denounce her. They didn’t make fine distinctions and they didn’t welcome a correction; their goal was to punish and silence. Sweeping accusations were made against Omar’s character, leaving the impression that any criticism of AIPAC, the powerful pro-Israel lobby, was proof of antisemitism. And this attempt to isolate and politically crush Omar was itself the embodiment of her protest. This is the power of AIPAC in action, the lobby that can’t be named, the doctrine—the transcendental importance of Israel and the rightness of its religious self-definition—that can’t be questioned.
So the truth content of the original Omar tweet depends on how we explain this onslaught. If it’s really just about the Benjamins (the hundred dollar bills with Ben Franklin looking back at us), that means she was being trashed, directly or indirectly, for pay. Politicians joined the mob either to protect their campaign revenue or shield themselves from other politicians defending their own campaign revenue. How likely is that? The answer depends on two prior questions: how important is campaign finance in setting the basic contours of US policy, and what proportion of this finance is controlled or strongly influenced by AIPAC?
These are questions for specialists in these areas, not me. I will go out on a limb, however, and say that the truth lies between the endpoints: some but not all of the bias in the US political system is attributable to the influence of big donors, and AIPAC has a substantial but far less than a complete lock on the flow of political money. You could compare it to other lobbies, like the NRA (National Rifle Association) and AARP (American Association of Retired Persons), both of which are feared for their ability to alter the balance of funding in competitive political contests. But neither of these two outfits is immune from attack, while AIPAC is. Gun control advocates go after the NRA all the time, and, while AARP is not exactly a political lightening rod, the complaint that greedy seniors are stealing money from our children is a popular meme on the Right. So AIPAC is different. This difference does not seem to be about money, at least not solely, as important as money is to the system and the groups that try to dominate it. AIPAC appears to possess a complementary form of power, perhaps rooted in the infrastructure of synagogues and other religious organizations as well as the allegiance of many socially prominent Jews active in secular organizations. When it marshals this network, you get the sort of response we saw to Omar.
This was a ferocious rebuke of a politician, clearly intended to be career-ending. It will be interesting to see if she can recover without abandoning her advocacy of Palestinians; I certainly hope so. The attack on Omar, however, is itself the embodiment of the fear all of her colleagues have to feel, that if they step out of line on Israel they will be crushed. Catering, intentionally or otherwise, to antisemitic tropes is completely unnecessary: the proof of the pudding is in the attack on it.
But let’s dig down one level. The criticism, partly fair, of Omar is that she bought into (so to speak) the anti-semitic slur that Jewish money constitutes a secret conspiracy against “the people”. This is the old socialism-of-fools stuff, endlessly recycled by bigots right up until this morning; see the demonization of George Soros, for instance. Because it exists, people who want to combat bigotry—and this includes progressive politicians—should build a giant moat around it and not go there. By suggesting that hidden Jewish money had bribed Congress into blind support for Israel, Omar crossed a line. It’s the same line that George Bush senior crossed with the Willie Horton ad, and that Trump crosses a dozen times every Twitter-soaked evening. Invoking a bigoted stereotype is a bad thing to do, especially for politicians with giant megaphones.
Yet the very response to Omar’s tweet demonstrated the truth she was stumbling for. A chorus of political and media honchos of every denomination, religious and political, rose up to denounce her. They didn’t make fine distinctions and they didn’t welcome a correction; their goal was to punish and silence. Sweeping accusations were made against Omar’s character, leaving the impression that any criticism of AIPAC, the powerful pro-Israel lobby, was proof of antisemitism. And this attempt to isolate and politically crush Omar was itself the embodiment of her protest. This is the power of AIPAC in action, the lobby that can’t be named, the doctrine—the transcendental importance of Israel and the rightness of its religious self-definition—that can’t be questioned.
So the truth content of the original Omar tweet depends on how we explain this onslaught. If it’s really just about the Benjamins (the hundred dollar bills with Ben Franklin looking back at us), that means she was being trashed, directly or indirectly, for pay. Politicians joined the mob either to protect their campaign revenue or shield themselves from other politicians defending their own campaign revenue. How likely is that? The answer depends on two prior questions: how important is campaign finance in setting the basic contours of US policy, and what proportion of this finance is controlled or strongly influenced by AIPAC?
These are questions for specialists in these areas, not me. I will go out on a limb, however, and say that the truth lies between the endpoints: some but not all of the bias in the US political system is attributable to the influence of big donors, and AIPAC has a substantial but far less than a complete lock on the flow of political money. You could compare it to other lobbies, like the NRA (National Rifle Association) and AARP (American Association of Retired Persons), both of which are feared for their ability to alter the balance of funding in competitive political contests. But neither of these two outfits is immune from attack, while AIPAC is. Gun control advocates go after the NRA all the time, and, while AARP is not exactly a political lightening rod, the complaint that greedy seniors are stealing money from our children is a popular meme on the Right. So AIPAC is different. This difference does not seem to be about money, at least not solely, as important as money is to the system and the groups that try to dominate it. AIPAC appears to possess a complementary form of power, perhaps rooted in the infrastructure of synagogues and other religious organizations as well as the allegiance of many socially prominent Jews active in secular organizations. When it marshals this network, you get the sort of response we saw to Omar.
This was a ferocious rebuke of a politician, clearly intended to be career-ending. It will be interesting to see if she can recover without abandoning her advocacy of Palestinians; I certainly hope so. The attack on Omar, however, is itself the embodiment of the fear all of her colleagues have to feel, that if they step out of line on Israel they will be crushed. Catering, intentionally or otherwise, to antisemitic tropes is completely unnecessary: the proof of the pudding is in the attack on it.
Tuesday, February 12, 2019
Lyndon LaRouche Is Dead (but not dead enough)
In lieu of an obituary, I am reposting Politics of Pastiche: "voters... need someone to fire all the political-correct police" from August 2015. See also The Higgins Memo, Anders Breivik and the Lyndon LaRouche Cult and Deep Structures of the Cultural Marxism Myth. And Here’s an Insane Story About Roger Stone, Lyndon LaRouche, Vladimir Putin, and the Queen of England.
In the introduction to his "compendium" manifesto, 2083: A European Declaration of Independence, mass-murderer Anders Breivik asked, "What is Political Correctness?" and "How did it all begin?" His answer dwelt on the Frankfurt School, and singled out Herbert Marcuse's Eros and Civilization as especially important. Breivik's text was copied and pasted almost verbatim from a screed called "Political Correctness: a Short History of an Ideology?" by William S. Lind, "Director of the Center for Cultural Conservatism at the Free Congress Foundation."
In turn, the "cultural Marxism" thesis of Lind's "history" can be traced to a 1992 article, "New Dark Age: Frankfurt School and Political Correctness," published in a Lyndon Larouche cult magazine, Fidelio The article's author, Michael J. Minnicino, subsequently disowned his work as "hopelessly deformed by self-censorship and the desire to in some way support Mr. LaRouche's crack-brained world-view."
Along the way, "conservative" Republican stalwarts Ralph de Toledano and Patrick J. Buchanan have recycled those crack-brained conspiracy theories, documented by abundant footnotes that typically lead either to a source who didn't say what they were credited with saying, to some other hack propaganda recycler or to an "authoritative" emigre like Victor Zitta or Lazlo Pasztor relying extensively on official histories published by the Axis-allied Horthy regime. Martin Jay traced the strange trajectory of this propaganda meme in "Dialectic of Counter-Enlightenment: The Frankfurt School as Scapegoat of the Lunatic Fringe."
This month saw the publication by Roger Kimball's Encounter Books (an "activity" of the Bradley Foundation) of yet another rehash of the discredited crap, The Devil’s Pleasure Palace: The Cult of Critical Theory and the Subversion of the West, by Michael Walsh. A credulous review of that book in the Washington Free Beacon presents the book's argument, apparently oblivious to its dubious lineage:
At the end of December 1982, the Wall Street Journal published an op-ed, "The Shattered Humanities" by William Bennett, who at the time was chairman of the National Endowment for the Humanities. Bennett's complaint was that "matters of enduring importance" -- "the true," "the good" and "the noble" -- had been abandoned because "we have yielded to the bullying of those fascinated with the merely contemporary." By the early 1990s, Bennett's lament about the decline of traditional values in the humanities had swelled into a moral panic about the alleged tyranny of political correctness on campus, fueled by best-selling books such as Allan Bloom's Closing of the American Mind, Roger Kimball's Tenured Radicals: How Politics has Corrupted Our Higher Education and Dinesh D'Souza's Illiberal Education: The politics of race and sex on campus.
Even President Bush I had to get into the act with a commencement address at the University of Michigan at Ann Arbor in which he railed against "political extremists [who] roam the land, abusing the privilege of free speech, setting citizens against one another on the basis of their class or race."
In spite of being called out more than two decades ago by a President of the United States, those political extremists liberals on the left have allegedly persevered in their "unrelenting demands... for increasingly preposterous levels of political correctness over the past decade." This, according to S. E. Cupp explains Donald Trumps popularity: "Trump survives -- nay, thrives! -- because he is seen as the antidote, bravely and unimpeachably standing athwart political correctness."
Meanwhile, "A new Rasmussen Reports national telephone survey finds that 71% of American Adults think political correctness is a problem in America today, while only 18% disagree. Ten percent (10%) are undecided."
"...voters crave the anti-status-quo politician. They want results. They need a fighter. They need someone to fire all the political-correct police." -- Sarah Palin, interview with Donald Trump
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| Anders Breivik |
In turn, the "cultural Marxism" thesis of Lind's "history" can be traced to a 1992 article, "New Dark Age: Frankfurt School and Political Correctness," published in a Lyndon Larouche cult magazine, Fidelio The article's author, Michael J. Minnicino, subsequently disowned his work as "hopelessly deformed by self-censorship and the desire to in some way support Mr. LaRouche's crack-brained world-view."
Along the way, "conservative" Republican stalwarts Ralph de Toledano and Patrick J. Buchanan have recycled those crack-brained conspiracy theories, documented by abundant footnotes that typically lead either to a source who didn't say what they were credited with saying, to some other hack propaganda recycler or to an "authoritative" emigre like Victor Zitta or Lazlo Pasztor relying extensively on official histories published by the Axis-allied Horthy regime. Martin Jay traced the strange trajectory of this propaganda meme in "Dialectic of Counter-Enlightenment: The Frankfurt School as Scapegoat of the Lunatic Fringe."
 |
| Roger Kimball |
In The Devil’s Pleasure Palace: The Cult of Critical Theory and the Subversion of the West, Walsh argues that the current obsession with politically correct speech began with a group of Marxist academics at the Institute for Social Research at Goethe University in Frankfurt, who would come to be known as the Frankfurt School. The scholars, Georg Lukács, Theodor Adorno, Walter Benjamin, Erich Fromm, and Herbert Marcuse, among others, developed a wide-ranging, if often contradictory, critique of the principal tenets of "bourgeois" Western culture—from the centrality of reason and individuality to Christian sexual mores.As Barkley and I have discussed, the term "politically correct" probably was popularized in the late 1960s and early 1970s by left-wing student activists wary of the self-righteous dogmatism displayed by self-styled Marxist-Leninist political grouplets. But that's not the way the conventional mythology goes.
At the end of December 1982, the Wall Street Journal published an op-ed, "The Shattered Humanities" by William Bennett, who at the time was chairman of the National Endowment for the Humanities. Bennett's complaint was that "matters of enduring importance" -- "the true," "the good" and "the noble" -- had been abandoned because "we have yielded to the bullying of those fascinated with the merely contemporary." By the early 1990s, Bennett's lament about the decline of traditional values in the humanities had swelled into a moral panic about the alleged tyranny of political correctness on campus, fueled by best-selling books such as Allan Bloom's Closing of the American Mind, Roger Kimball's Tenured Radicals: How Politics has Corrupted Our Higher Education and Dinesh D'Souza's Illiberal Education: The politics of race and sex on campus.
Even President Bush I had to get into the act with a commencement address at the University of Michigan at Ann Arbor in which he railed against "political extremists [who] roam the land, abusing the privilege of free speech, setting citizens against one another on the basis of their class or race."
Ironically, on the 200th anniversary of our Bill of Rights, we find free speech under assault throughout the United States, including on some college campuses. The notion of political correctness has ignited controversy across the land. And although the movement arises from the laudable desire to sweep away the debris of racism and sexism and hatred, it replaces old prejudice with new ones. It declares certain topics off-limits, certain expression off-limits, even certain gestures off-limits.Isolated anecdotes and broad generalizations can only get you so far. The elusive scourge of political correctness needed to be explained by theory of its origins. Thus the Minnicino/Larouche conspiracy theory, taken up by Lind, Buchanan, de Toledano, Breivik and now Walsh.
In spite of being called out more than two decades ago by a President of the United States, those political extremists liberals on the left have allegedly persevered in their "unrelenting demands... for increasingly preposterous levels of political correctness over the past decade." This, according to S. E. Cupp explains Donald Trumps popularity: "Trump survives -- nay, thrives! -- because he is seen as the antidote, bravely and unimpeachably standing athwart political correctness."
Meanwhile, "A new Rasmussen Reports national telephone survey finds that 71% of American Adults think political correctness is a problem in America today, while only 18% disagree. Ten percent (10%) are undecided."
National Survey of 1,000 American Adults
Conducted August 25-26, 2015
By Rasmussen Reports
1* Do Americans have true freedom of speech today, or do they have to be careful not to say something politically incorrect to avoid getting in trouble?
2* Is political correctness a problem in America today?
Hey, if they keep repeating it, it must be true, right?
 |
| Three Stooges: Lyndon Larouche, Roger Kimball, Anders Breivik |
Monday, February 11, 2019
It Is Monday And Usual Suspect Bashes Social Security
That would be Robert J. Samuelson at the Washington Post, and, yes, he has done it yet again, actually for the first time in a while. Dean Baker has already done a good job of cutting him up over on CEPR, but I can't help piling on as well.
Samuelson presents his case as opposition to Social Security being expanded as proposed by Cong. John Larson (D-Conn). Samuelson also cites a recent study Andrew Biggs at AEI supposedly showing that old people have been doing better in income terms than previously reported.
Dean notes several points. One is that the current setup of Social Security is that is going to be reducing benefits over the next few years as retirement ages get raised as a result of long past agreements, actually dating to 1983. The supposed expansion by Larson is quite minor and mostly just offsets this planned reduction, although not precisely.
Another point is that while it is true that while some older people have been doing better than previously reported, although not the poorest recipients, the main source of this better performance is due to something that will be disappearing in the near future. It is due to income from defined pensions, which have nearlyi all disappeared. Such income will be less and less important for older people as time proceeds.
I shall add to these valid points one other. It is a par for the course nearly alll times RJS gets off onto this topic. Early in his column he sets up as how disastrous for future budget balances all these awful "entitlements" will be is to cite projections for Social Security, Medicare, and Medicaid all lumped together. So, according to the CBO, while federal trnsfers to over 65s in 2005 was 35% of federal outlays, and those rose to 40% in 2018, these are projected to be 50% in 2029. Now while this might happen if no changes happen, the overwhelming majority of this increase is due to texpected further increases in medical care prices, not due to an increase in use, much less an increase in Social Security spending. It is only a couple of those projected percent increases.
He does this all the time, citing these kinds of scary looking aggregate numbers and then jumping to focus on Social Security and how we need to cut benefits (and certainly block any proposed increases in benefits). He never talks about how maybe we should make serious reforms in our health care system that would really put a serious dent in those projected increases. I recognize that this is a lot harder than it may seem (see all the battles over Obamacare). But RJS simply shreds his own credibility by failing to make this point before he jumps right in to wildly exaggerate the fiscal issues related to Social Security.
OTOH, given how much just totally weirdly wacko things that have been going on, having Robert J. Samuelson back on his old Mondy morning schtick bashing Social Security is almost a nostalgic relief, a return to older and simpler times.
Barkley Rosser
Samuelson presents his case as opposition to Social Security being expanded as proposed by Cong. John Larson (D-Conn). Samuelson also cites a recent study Andrew Biggs at AEI supposedly showing that old people have been doing better in income terms than previously reported.
Dean notes several points. One is that the current setup of Social Security is that is going to be reducing benefits over the next few years as retirement ages get raised as a result of long past agreements, actually dating to 1983. The supposed expansion by Larson is quite minor and mostly just offsets this planned reduction, although not precisely.
Another point is that while it is true that while some older people have been doing better than previously reported, although not the poorest recipients, the main source of this better performance is due to something that will be disappearing in the near future. It is due to income from defined pensions, which have nearlyi all disappeared. Such income will be less and less important for older people as time proceeds.
I shall add to these valid points one other. It is a par for the course nearly alll times RJS gets off onto this topic. Early in his column he sets up as how disastrous for future budget balances all these awful "entitlements" will be is to cite projections for Social Security, Medicare, and Medicaid all lumped together. So, according to the CBO, while federal trnsfers to over 65s in 2005 was 35% of federal outlays, and those rose to 40% in 2018, these are projected to be 50% in 2029. Now while this might happen if no changes happen, the overwhelming majority of this increase is due to texpected further increases in medical care prices, not due to an increase in use, much less an increase in Social Security spending. It is only a couple of those projected percent increases.
He does this all the time, citing these kinds of scary looking aggregate numbers and then jumping to focus on Social Security and how we need to cut benefits (and certainly block any proposed increases in benefits). He never talks about how maybe we should make serious reforms in our health care system that would really put a serious dent in those projected increases. I recognize that this is a lot harder than it may seem (see all the battles over Obamacare). But RJS simply shreds his own credibility by failing to make this point before he jumps right in to wildly exaggerate the fiscal issues related to Social Security.
OTOH, given how much just totally weirdly wacko things that have been going on, having Robert J. Samuelson back on his old Mondy morning schtick bashing Social Security is almost a nostalgic relief, a return to older and simpler times.
Barkley Rosser
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