What is Looting?

"Looting is a natural response to the unnatural and inhuman society of commodity abundance." -- Guy Debord, “The Decline and Fall of the Spectacle-Commodity Economy.”

The photograph used in Andy Warhol's 1964 print, “Race Riot” was taken by Charles Moore and was published in LIFE magazine in May of 1963. Warhol used it without permission and Moore sued. Eventually there was an out-of-court settlement. The scene depicted was not a "Race Riot" as Warhol's presumably ironic title claimed. It was a police attack ordered by Police Commissioner "Bull" Connor on a nonviolent demonstration in Birmingham, Alabama.

I remember these photos well because they appeared at the dawn of my political awakening. I was 15. The Warhol print sold in 2014 for $62,885,000. I had to stop myself when I started to type $62,885.00. I thought the latter figure was a lot of money. No, $62,885,000. 

The text in the LIFE feature where the Birmingham photo appeared claimed that Martin Luther King Jr.’s strategy of nonviolent direct action invited police brutality and “welcomes it as a way to promote the Negroes' cause."

 

Excuse me? Nonviolent protests invite police brutality? Where have we heard that legend before? Remember, though this was the voice of liberal journalism "sympathetic" to the civil rights cause. 

Sometimes a moment of clarity strikes when I see an absolute denial that there can be any justification whatsoever for some action or expression. This happened in response to the outrage provoked by an NPR interview with the author of a recent book that offered a defense of looting. Intuitively, I would consider looting to be troubling, frightening -- something I would rather have nothing to do with. But utterly, completely indefensible? 

The virulence of the rejections made me curious. I'm familiar with affirmative historical analysis of other "indefensible" actions. People may be familiar with the writing on rioting by Charles Tilly, E. P. Thompson, Eric Hobsbawm, Peter Linebaugh, Nick Blomley and others. But these focus mainly on pre-modern or early modern episodes. As a phrase in Hobsbawm's classic essay "The Machine Breakers" suggests "collective bargaining by riot" was seen by him as anticipatory of later trade union strikes.

I found the NPR interview somewhat flippant. Perhaps I'll return to that eventually. But in searching for affirmative analyses of 21st century rioting and looting I found some very interesting leads: Riot. Strike. Riot: The New Era of Uprisings by Joshua Clover, "Why is there no just riot theory?" by Jonathan Havercroft and, last but not least, the prophetic essay by Guy Debord alluded to in the title, "The Decline and Fall of the Spectacle-Commodity Economy." 

The latter article focuses on the Watts riot of 1965, which becomes eerily contemporary in the era following the murder of George Floyd. Just three weeks before he was assassinated, Martin Luther King Jr. acknowledged the inevitability, if not the legitimacy, of riots as "the language of the unheard." Yet 55 years after Watts it remains politically obligatory to unequivocally denounce riots and looting as having nothing to do with legitimate, peaceful protest. Talk about your "political correctness" speech police! To even question this knee-jerk denunciation is seen as "glorifying violence."

'I Plan to Lead Another Non-Violent March Tomorrow' is the caption of a 1964 cartoon from the Birmingham News by Charles Brooks. Judging from a wider sampling of Brooks's work, he was a “moderate.” 

"In an early Gallup question on the issue, Americans were asked whether tactics such as 'sit-ins' and demonstrations by the civil rights movement had helped or hurt the chances of racial integration in the South. More than half, 57%, said such demonstrations and acts of civil disobedience had hurt chances of integration, while barely a quarter, 27%, said they had helped."

A couple of novelists from back in the day wrote some interesting observations about questions. In Gravity's Rainbow, Thomas Pynchon wrote, "If they can get you asking the wrong questions, they don't have to worry about answers." "In the realm of totalitarian kitsch," Milan Kundera wrote in The Unbearable Lightness of Being, "all answers are given in advance and preclude any questions." Kundera went on to define kitsch as causing "two tears to flow in quick succession. The first tear says: How nice to see children running on the grass! The second tear says: How nice to be moved, together with all mankind, by children running on the grass! It is the second tear that makes kitsch kitsch."

There is also a kitsch of righteous indignation: the denunciation of the cowardly terrorist or, closer to home, of the rapacious extractive corporation. Or maybe it’s the $62, 885,000 sale in 2014 of an Andy Warhol print titled “Race Riot.” This is not to say that corporations are not rapacious or terrorists not cowardly for targeting innocent civilians. But those actions are at least explicable even if they’re not justifiable. Rioting and looting are commonly denounced as not only violent and "counterproductive" but as mindless and incoherent.

But what does all this have to do with environmental sustainability? As Joshua Clover points out, "It matters little whether one conceives of climate collapse as cause of refugees, or refugees the source of resource burdens. In the present world, immigration has become an ecological fact, ecology a matter of immigration." This is also true for racialized class stratification. Our present mode of circulation of commodities requires expansive policing, both of borders and of internal, "disadvantaged" communities. Mass incarceration is a feature of the Spectacle-Commodity economy, not a bug. And a print of a photograph of police attacking civil rights protesters can fetch $62,855,000. Sixty-two million, eight-hundred and fifty-five thousand U.S. dollars. And no cents.

It is logical to make legal appeals regarding legal questions," Debord wrote, "What is irrational is to appeal legally against a blatant illegality as if it were a mere oversight that would be corrected if pointed out.

Much of the conversation of environmental sustainability revolves around the question of how to educate and persuade consumers, policy makers or industries to act more intelligently and responsibly toward the environment. What if we are asking the wrong questions?

Should We Fear A Reappearance Of Inflation?

 In today's Washington Post Robert J. Samuelson has raised the possibility that the Federal Reserve may be setting the US up for a reappearance of inflation.  He invoked the 1960s and 1970s when supposedly the Fed allowed inflation to get out of control out of a supposedly misguided effort to bring down unemployment by allowing successive small increases in inflation. Supposedly the newly released report on changed Fed policies may be taking us back to those bad old days, even though for now RJS admits that inflation is low, with expectations of inflation only at 1.34%.  How worried should we be?

OK, I am not going to say that a resurgence of inflation is impossible.  I can imagine it possibly resurging, with such a development perhaps being associated with a sharp decline of the US dollar, perhaps associated with a turn from its use as a reserve currency.  I do not see that happening immediately, but there is a theoretical literature that suggests that such an event could happen rather suddenly at some point.  If so, then maybe it could be happen.  Is the new Fed policy likely to bring this on?

I suppose one reason to be concerned is that the supposedly new policy approach has been rather opaque.  I have had trouble getting a clear picture what the changes are in policy. The main reports have been relatively undramatic, basically an idea that at least through the next year there will be no interest rate increases.  Probably a bigger deal is that the Fed might tolerate inflation higher than the 2% targeted rate.

But a curious thing is that a funny thing has happened about that target.  As long noted by Dean Baker and some others, that 2% is a target, meaning that supposedly that is what the rate should be on average.  If that is the case, then we should expect it to be higher than 2% as much as it is below that rate. But in practice it seems that the "target" has become an upper limit, and Samuelson essentially refers to it this way.  This makes for the rather weird outcome that a reassertion of what has long been offficial policy but not followed in practice should again be the official policy is somehow a scary threat of a possible outbreak of future serious inflation.  This becomes a rather absurd analysis.

Addendum (9/1): I note one area where we have seen rising prices is for food, with many people worried about that, indeed, I have just heard a poll showing this being the top worry of Americans during the current pandemic.  As it is, this seems to be at least one supply-side driven element in inflation that is out there, probably not so important for longer run inflation policy.

Barkley Rosser

Assar Lindbeck Passes On

 Assar Lindbeck died on Aug. 28 at the age of 90, probably the most influential Swedish economist of the latter part of the 20th century.  He was the main driving force behind getting the Swedish central bank at the end of the 1960s to establish the Sveriges Riksbank Award in Economic Sciences in Memory of Alfred Nobel, a.k.a., the "Nobel Prize in Economics" (I get increasingly tired of the usual retreads who every fall remind us when the media refers to it by the second name that it "really" should be called by the official first name; we all know this by now). He was a professor at Stockholm University, longtime director of the International Institute for Economic Affairs, and in 1992-93 chaired the "Lindeck Commission," which laid out policy proposal for scaling back the Swedish welfare state, many of which were adopted after 1994.

In terms of his own contributions to economic thought beyond the matters noted above, I note that he wrote influential articles about insider-outsider labor market models, rent control (he was against it), and also on how an extensive welfare state system may lead workers to become shirkers, with this argument in particular playing into the recommendations of the Lindbeck Commission, which led to reducing health leaves and related matters in the Swedish system, although it remains among the most generous in the world, although now not as large as those in Denmark, France, Finland, and Belgium, to name a few.  Sweden is now the "liberal welfare state," not the largest or most extensive as it was in its heyday under Prime Minister Olof Palme before he was assassinated.

Certainly one can debate whether Sweden needed to scale back somewhat, and maybe it did.  After performing very well on multiple criteria from low poverty through low unemployment and inflation and low budget deficits for many decades, the Swedish model sort of went off the rails in the late 1980s, leading to serious macroeconomic crisis in the early 1990s, which was the immediate trigger for the government adopting the kinds of proposals Lindbeck advocated. It has performed better since, doing better than most European nations during the Great Recession, with having stayed out of the Eurozone probably helping, as well as using a very expansive monetary policy with negative interest rates, none of this particularly part of Lindbeck's agenda or suggestions.

I shall further note that it has long been argued that Lindbeck's motive for pushing for creating the Prize was indeed ultimately driven by internal Swedish politics and a desire to support the kinds of reforms he ultimately managed to get accepted in the 1990s.  Crucial in this was not just that he got the Prize established, but he became by all accounts the dominant force on the selection committee until the mid-1990s. about the time his recommended reforms were accepted, stepping down after an outbreak of controversy associated with the first game theory award for Nash, Harsanyi, and Selten.  More generally, it was observed, that with an occasional exception, the prizes tended to favor advocates of neoclassical orthodoxy, with this viewed as supporting the kinds of policy arguments Lindbeck favored in Sweden.

There are some oddities I shall recount based on gossip from primary sources I have heard.from.  So when I went to his Wikipedia page to double check on details of his career, it claimed that the award for James Buchanan in particular in 1986 was especially important for him as part of this general ideological agenda. Maybe, but I have heard otherwise.  Indeed, what I heard a long time ago, sometime before that award was made, from a primary source, was that Lindbeck had claimed at one point that there were two people who would get the Prize "over my dead body."  One was Joan Robinson, still alive when that remark was made, and indeed she never got it.  The other was James Buchanan.  So, assuming my source heard right, the award for Buchanan was not the result of some longstanding plot by Lindbeck to give it to him as part of his general plot to classically liberalize Swedish policy. Something came up, and from what I have heard from other sources (I used to have good sources on that famous committee, but no longer) was that it was the large budget deficits being run by the Reagan administration, which Lindbeck disapproved of and saw as roiling international financial markets, with the upward surge of the USD to 1985 driven by high interest rates creating havoc in Europe.  At the time Buchanan was pushing for a balanced-budget amendment to the US Constitution, basically a silly idea. But supposedly Lindbeck saw that as a way to send a message to the Reagan administration of disapproval for their high budget deficit policies, and this overcame whatever it was that had previously made Lindbeck so negative on Buchanan.

I have mixed feelings about Lindbeck ansd his recored and influence, but I shall wish him an RIP.

Addendum (9/1): Some might argue that Lindbeck's influence may be seen at least indirectly in recent policies in Sweden during the pandemic that have not been very successful.

Barkley Rosser

There Will Be No Postponing Social Security Taxes

 Among the items that President Trump issued an "executive action" about three weeks ago was that for people earning less than around $104.000 per year, their fica taxes were to be postponed until Jan. 1, not cut, merely postponed, although Trump made noises that if he is reelected he will simply eliminate the fica tax entirely, although unclear how he plans to fund Social Security without it.  

Anyway, Allan Sloan in the Washington Post reports that this initiative is now just completely dead in the water.  It has too many problems, too many opponents, and action on implementing it in the Treasury Department has simply stalled out, almost certainly for good due to all this.  Quite aside from people facing potentially huge fica tax bills in January due to four months of postponement, it apparently is very complicated to set this up, and would take many months to do so, involving businesses and the Treasury Dept. having to put in place all kinds of mechanisms to figure out exactly which people would get their taxes postponed and which would not.  A real killer is that businesses pretty much across the board have objected to this proposal, with this now official as 30 different such groups have called for the cessation of this effort through the US Chamber of Commerce.  This is just going nowhere.

This should be contrasted with the temporary fica tax cut that Obama had in place during 2011-2012. There are two large differences between that and what Trump has so incompetently proposed. One is that Obama had it pass through Congress, not be the result of a presidential directive or memo.  The other is that it was completely simple: all Social Security taxes stopped being collected for the period in question, not a system based on treating people differently based on their incomes and also not a postponement.  It was a straight cut, if only a temporary one.

An odd aspect of that Obama cut was that when it came to an end the GOP members of Congress were pretty near unanimous in voting to end it and bring back fica taxes.  Somehow this did not prevent them from continually ranting about supporting tax cuts and opposing all tax increases.  Of course it was technically not an increase but simply undoing a cut, but funny how something that raised taxes more on poorer people received their ready support as they argued for cuts for higher income people and still do.

Barkley Rosser

An Increasing Anomaly In The US Balance Of Payments

 On Econbrowser Menzie Chinn has posted about an increase in the scale of US international net indebtedenss. Since the late 1980s the US has been a net debtor internationally, borrowing more from abroad then we are lending and investing there.  The increase in this net indebtedness has noticeably accelerated since our current POTUS took office, and especially this year.  The size of that net indebtedness has gone from about 40% of US GDP to somewhat more than 55%, a pretty substantial increase, given that we have been in this condition for over three decades and in three years by more than a third.  The fiscal stimulus of this year has definitely been overwhelmingly financed by foreign borrowing.

This increase in net indebtedness highlights a longstanding anomaly that now looks even more anomalous.  Even though the US has been a net debtor for over three decades, it has remained a positive net earner on capital income arising from all those international capital movements into and out of the US.  This is mostly measured by the primary income part of the international capital account, which last year was in surplus at a bit over $60 billion.  What is more curious is that this does not seem to have changed much at all over the last five years, some slight changes here and there, but mostly unchanged.  I confess to being mystified as to how an increase in net indebtedness by more than a third has led to essentially no change in the capital income payments situation.

I have not gone digging to get the exact breakdown, but a few years ago it was clear that what was going on is that most of the US assets abroad are in business investments earning large profits and thus high rates of return on the investments, while foreigners are holding assets in the US earning much lower rates of return, most notably US government securities, the outcome of all that foreign borrowing by the US government over a long period of time.  The foreigners have been sending their money here as the "safe haven," an argument or motive that may be breaking down according to some.  So they have been willing to accept the low returns for the supposed safety, while US investors have been taking bigger risks but getting bigger returns as a result.

This all is clear, and maybe the super low interest rates on current US government securities are sufficient to explain why we have seen barely any change in that capital income balance, even as the net indebtedness has substantially increased, but somehow it would seem there must be more, with somehow the US holdings abroad becoming more profitable.  In any case, I do not have a solid explanation for this apparent anomaly.

Barkley Rosser

Remembering The Bombing Of Sterling Hall A Half Century Ago

 A half century ago at 3:42 AM on Monday, August 24, 1970, the New Year's Gang set off an ammonium nitrate bomb in the back of a Ford pickup track next to Sterling Hall on the University of Wisconsin-Madison campus.  They were aiming it at the Army Mathematics Research Center, then directed by my later father, J. Barkley Rosser [Sr.]. However, they were notoriously the Gang That Could Not Bomb Straight and hit the physics department instead, killing a physics post-doc, Robert Fassnacht, and injuring several other people, as well damaging buildings even blocks away, aside from the major damage to Sterling Hall itself.  

Of the gang, three would eventually be apprehended and serve time in jail: the two Armstrong brothers from the east side of Madison, sons of an Oscar Mayer plant worker, Karl, the group's leader who was caught first and served seven years, and his younger brother, Dwight, who served three years and is no longer alive, with David Fine of Baltimore also serving three years.  The fourth member, Leo Burt, remains at large.

Last October I wrote an 8-page essay reminiscing about the bombing that contains details both representing my peculiar perspective as well as some tidbits not widely public information.  I am willing to send it to anybody who requests it of me.  It contains six parts.

The first and longest part is about my relations with my parents, with a lot of information specifically about my late father.  We respected each other personally, but disagreed politically, although I never approved of violence and thus severely disapproved of the bombing, as well as some personal mistreatment my parents experienced.

The second part recounts my own experiences on the day of the bombing, which is short as they were unexceptional, especially compared to many other people then (I was nowhere near it when it happened).

The third part, also long as the first one, involves a more detailed analysis of the AMRC and issues surrounding it.  This includes that indeed people working there, certainly including my late father, did work of the value to the US military, with some of it being used in Vietnam, the main complaint of protesters who wanted the center shut down or at least moved off campus. However, I also note that mathematics has many uses, both good and bad, and that some of the math developed there is also used in economics, including in such beneficial areas as environmental economics.  It is easy to say that maybe there should be a "good" math research center not funded by the military, but in fact when the military funding disappeared later, none other was forthcoming and the center simply closed.

The fourth part reveals that the wrong person died in the bombing.  Fassnacht was in the lab because the wife of his professor, the late Bill Yen, demanded that Bill stay home for domestic reasons.  Bill was supposed to be in the lab, not the unfortunate Robert Fassnacht.

The fifth part involves a later event, a mitigation hearing held in the fall of 1973 after Karl Armstrong was captured.  He plead guilty, but the mitigation hearing was officially about his sentencing, although it ended up being essentially a trial of the whole war in Vietnam, with famous outside lawyers participating such as William Kunstler. I offered to testify, thinking the judge was not impressed by all this, but one of the local attorneys said this was not needed. However, in the end, the judge imposed the maximum sentence of 25 years, of which seven were served.  After getting out, Karl Armstrong for many years ran a fruit juice stand near campus, "Loose Juice," and I got to know him.

The final section recounts a banquet in July, 1989 associated with a conference of old UW radicals returned to town.  At the banquet, which I attended, Karl Armstrong appeared and delivered an eloquent and unequivocal apology for what he and his gang members did, ranging from to the Fassnacht family to the anti-war movement, which the bombing severely damaged. 

There is much more detail I am leaving out in the essay, but I conclude this by noting that we have seen some protesters in recent months engaging in violence.  This event needs to be remembered as a warning that it is easy for violence to get out of hand and go too far and damage the cause that is supposed to be serving.

Barkley Rosser

Whining About Lack Of Academic Leadership

 At my so-called university named for the fourth president, the slaveowning "Father of the Constitution."  No, I am not going to talk about the racism issue, which there is some effort to deal with on campus, notably in renaming three buildings named for Confederate figures, with our Provost originally from South Africa speaking reasonably intelligently about that issue.

No, we had our annual general faculty meeting to begin the year, classes supposedly beginning on Wednesday, supposedly a mixture of live and online, although likely to go totally online any minute as Eastern Mennonite University also in Harrisonburg just went totally online and delayed student move-in due to an outbreak of the virus, and Facebook is full of photos of our students partying without masks and packed together on balconies. We will not be far behind on that one.

So many of my colleagues never attend these meetings, but when I have been in town, I have since I first started here in 1977, the year the name was changed from Madison College and there were only a third as many students as there are now.  The speeches are mostly full of party line rah rah baloney I have always had fun making snide remarks about to pals. But in fact I have long enjoyed seeing faculty from across campus, with this meeting increasingly the only time in the year one sees any of them.  I knew that was not to be this year with the meeting virtual, but another regular feature has been a speech by our president, with the current one starting his 8th year here, Jonathan R. Alger.  These speeches, despite usual propaganda, also usually do provide some information about new developments on campus, and there have been some not related to racism or coronavirus, not to mention relations with Richmond, important as this being a state school.

But, no, Alger did not speak except for a minute at the beginning to introduce the Provost. OK, I get that he does not want to say anything inaccurate, but there is much he could say that is not inaccurate, including being honest about just what all we do not know and is up in the air. But he chiekened out, a complete failure of academic leadership.  I am already down enough as it is with everything, but I admit that irrational as it might be, this failure of him to speak at all left me completely demoralized at the end of the meeting, which they did not even clearly announce.  The Provost stopped speaking and sort of said "have a good semester," with many of us watching still pictures for quite some time obviously expecting Alger to appear and speak, gradually dropping off. I hung on until the number dropped below 30, the old number of statistical significance, before I left demoralized and depressed.  I have gotten over that and am now just disgusted and ticked off at this complete cowardice and lack of academic leadership.

Barkley Rosser

Kamala Harris Also Has An Economist Uncle

 Who I happen to know and who got his PhD in economics and computer science from the University of Wisconsin-Madison.  He is now being identified in the media as Gopalan Balachandron, which puts his last name first.  I knew him as a grad student when Kamala's dad, Don Harris, was on the UW faculty, and he was "Bala Gopalan" to all of us, a very witty and cosmopolitan guy.  When I saw him on the news, now 80 years old and living in Delhi and praising the selection of Kamala as Dem VP candidate, I was not sure it was him, but quick checking established it is.  I finally also remembered somebody bringing it up that he was Don's brother-in-law, only two years older than him, but he did not want to talk about it, this being when the marriage of Don and Bala's sister was going down the tubes.  

The news reports have it that when he was working most recently he was working for an Indian government-related think tank called the Institute for Defence Studies and Analysis in its American Affairs section.  I also saw one report referring to him as "Prof." which makes me think he was an academic for awhile, but I lost track of him after he left Madison, except for hearing from a common old friend of ours in Chennai that Bala "works for the government in Delhi."  But I guess not anymore.  It strikes me that if Biden-Harris win, Bala might become an important diplomatic player.

It also strikes me that if Kamals's dad, Don Harris, continues to lay low and essentially not support her, I could imagine Uncle Bala getting brought in to provide some male family support.  I bet he could handle the media well. He is quite a character and very sharp as well as articulate.

Barkley Rosser

The UAE-Israel Deal

 Several days ago the United Arab Emirates (UAE) and Israel have agreed to have diplomatic relations, with this being the third Arab nation to officially recognize Israel, following Egypt in 1979 and Jordan in 1994. President Trump and his supporters are claiming that this is a great breakthrough to world peace, with Jared Kushner supposedly the key player on the American side.  But most observers think that this is an exaggeration, to put it mildly.  The standard summary is that this deal is a win-win-win-lose: a win for the US, UAE, and Israel, but a lose for the Palestinians.

Let me give the Trump people, including even the usually incompetent Jared Kushner, some credit.  They have managed to achieve only a handful of international agreements.  And given the long and difficult relationship between Israel and the Arab nations, it must be recognized that making such an agreement is difficult, so they deserve some congratulations, even if this is far less than what they claimed they were going to achieve, which was supposed to be a much broader agreement. But given the administration's strong tilt to Israel from the beginning, supporting moving the US embassy to Jerusalem, recognizing the annexation of the Golan Heights, and supporting a plan that would countenance annexation of territories in the West Bank, it is unsurprising that the Palestinians simply withdrew from any negotiations being pushed by the Trump administration. There simply was not going to be that more general agreement.

Of course we must admit that there is a sort of gain for the Palestinians: the UAE leadership demanded a cessation of the Israeli plans to annex West Bank territories, thus retaining a smidgeon of a chance for the nearly dead two state solution that supposedly came out of the Oslo Accord. Of course, Netanyahu says this is only temporary, and he retains the plan to do annexation. But that plan is now on hold. But this is a matter of the good thing being a matter of Israel not doing a bad thing that Trump and Kushner were supporting them in doing. This is not something to get too into praising about.

There is also the matter that there was a lot less input from Trump and Kushner to this outcome than they would have us believe. This deal has been in the works for a long time. Indeed, while he did not make a big deal about it and was ridiculed by the Trumpisti when he mentioned it, Biden and Obama did play a role in the early stages of this. The initial openings between the UAE and Israel date as far back as 2013 with more definite moves happening in 2015, with the top people in the Obama admin aware of this and encouraging it.  From 2015 on there were Israeli businesses operating in the UAE, and the two have shared intel since from around then, if not earlier, mostly about Iran, whom they share an enmity towards.  The key player on the UAE side has been its top leader, Prince Mohammed bin Zayed (MbZ) of Abu Dhabi. He is viewed by many as more important in Middle East matters than his junior sometime ally, MbS in Saudi Arabia.  While these two generally work together mostly, they have backed different groups in Yemen, and Saudi Arabia is apparently not likely to follow UAE on making an open deal with Israel, although rumors have Bahrain and Oman possibly doing so.

Will this deal lead to peace between Israel and the Palestinians or peace between Iran and its regional enemies or even a major relaxation between Israel and the broader Arab world?  Probably not, possibly even aggravating some of these.  But it may reflect public acknowledgement of the reality on the ground.

Barkley Rosser

"UTTERLY DESTITUTE OF ARRANGEMENT"

 

MARX’S PAMPHLETIST: CHARLES WENTWORTH DILKE AND HIS TRACT ON THE SOURCE AND REMEDY OF THE NATIONAL DIFFICULTIES (1821)

Giancarlo de Vivo, Contributions to Political Economy, Volume 38, Issue 1, 2019, Pages 59–73,  LINK

Abstract

This paper considers a largely unknown pamphlet, originally published anonymously in 1821, and assesses its place in the history of classical and Marxian thinking about value, surplus value and profits. It identifies its author and outlines his career and background in the context of nineteenth-century British politics.

"The pamphletist is a neglected economist—he is even absent from Seligman’s famous 1903 article "On some neglected British economists," which deals with many of his contemporaries, with the intention of rescuing them from undeserved oblivion. All in all, we can say that the pamphletist, even though not completely forgotten, has not received the attention it [sic] deserves if one accepts Marx’s claims on his behalf."

...

"We may last briefly comment on the fact that, apart from his grandson’s statement, no other grounds have been provided for assuming that Dilke was the pamphletist, and indeed this seems to be often taken with a dubitative formula when the attribution is noticed." 56

The End Of Special Fiscal Stimulus

 A week ago a two week long negotiation between Dem Congresspeople, Nancy Pelosi from the House and Chuck Schumer from the Senate and Treasury Secretary Steve Mnuchin, who cut deals with Pelosi and Schumer three times earlier this year, but now Trump's Chief of Staff, former Freedom Caucus leader in the House, Mark Meadows, notorious for only destroying deals and never making any. And in this case all the reporting is that a week ago he "blew up" the negotiations, taking a hard line on orders from Trump. So, where are we at now?

For starters yesterday the Senate adjourned until after Labor Day. So, the market expectations that a deal will be cut soon are a joke. There will be no deal anytime soon, and maybe never. Many things have run out, whose impact has not fully arrived: end of extra unemployment, end of PPP assistance for small businesses, end of no evictions, and several other things.

Yes, there have been vague noises in the past week about restarting the negotiations, but they went nowhere.  Dems indicated that they were willing to compromise on many issues.  To pick a big symbolic one has to do with the total spending level.  Going into this the Dems were pushing $3+ trillion and the GOP was pushing $1 trillion. Gosh, looks like $ 2 trillion would be an obvious compromise, and the Dems have publicly indicated they would be willing to go to that, but, no, Meadows held the hard line, and, along with some other issues, such as a roughly $800 billion difference over state and local aid, which is clearly the largest chunk of this stalemate. As it is, Meadows left town and the Senate has gone on leave until after Labor Day.  No deal.

What is unclear if Trump and his incompetent advisers actually think that his "executive actions" put out 6 days ago will save the US economy or not.  I recently posted on that, but it needs some updating, but the bottom line is that, no, what he did last weekend will not stimulate the economy and even overcome all the disappearing fiscal stimulus from the deals earlier in the year, especially the increased unemployment benefits and the PPP aid for small businesses, not to mention evictions, the only matter out of 4 actions last weekend was an actual Executive Order, but it was an order that HUD "consider" changing rules so people will not be evicted, and, big surprise, HUD has done nothing.  I am not going to waste time by going through the details of his UI and Social Security proposals because they seem to have fallen into a hole and are going nowhere. The only item actually happening is that in contrast to my last post on that is that indeed interest payments on student debts will be put off until the end of the year, which is fine, but a very small matter.

So, the latest evidence is that indeed the former V recovery is indeed slowing down, with retail sales up only by 1.2% in July.  Many are now suggesting we may see an actual GDP decline into a "wiggly W" pattern, although  I am not going to pass on that, but that V is definitely flattening. 

But it seems that maybe Trump and Meadows foresaw that maybe their actions would not improve the economy. So their plan in that case is to blame the Dems for the bad economy outcome: hey! they did not accept our offer!  They seem to have forgotten, if they ever knew it, that the president is held responsible when elections arrive for the state of the economy, and certainly for other big events such as the pandemic.  Trying to blame Dems in Congress for the economy or governors, the media, the Chinese, the WHO, the scientists, or anybody else other than the administration for what is going on with the pandemic, especially given that all other high income nations have done better than the US, suggests that Trump and Meadows are completely delusional.  Hopefully the US electorate will not be so deluded.

Barkley Rosser

Donald J. Harris And His Daughter Kamala Harris

 Now the Democratic candidate for Vice President of the United States, a historic pick, no matter what one thinks of her, and I know quite a few people on the left and Dems more generally who are not fans of hers, although many observers think she may be the strongest VP candidate for Biden to beat Trump and Pence, and I am looking forward to her tearing current VP Pence to shreds in their debate.

Anyway, as I have noted a few times before here, I have come to realize how old I am because I know parents of people running for president, and one of those happens to be the father of the now-selected Dem VP nominee, Kamala Harris, who was running for prez before she strategically pulled out early back in January, now an obviously smart move (and I do think she is plenty smart, whatever else one thinks of her).  I have never met her, but I know her dad, Don Harris quite well, although I have not seen him for some time now.

I first met Don in 1968 when he arrived at the University of Wisconsin-Madison where I was in my senior year as an undergrad. I took Development Economics from him, and he had a serious influence on my thinking.  He was the first faculty member I had encountered who took Marx seriously.  Like his friend Joan Robinson, he is not a Marxist, seeing too many problems with Marxian theory. But he took Marx seriously and had us read people who had Marxist perspectives on colonialism and imperialism and how these issues affected poorer less developed nations.

Later as a grad student there I would take Advanced Macroeconomic Theory from him, and he was even on my committee briefly before he left for Stanford in 1972, where he was on the faculty until retiring in 1998.  He is still alive, and I think 82 years old, or so.  He did a lot of advising the UN as well as the government of his home nation, Jamaica.

Two papers by him that I think are important are his 1973 "Capital, Distribution, and the Aggregate Production Function," in the American Economic Review. In this he provided an excellent perspective on the Cambridge controversies in the theory of capital, and with Amit Bhaduri, "The Complex Dynamics of the Simple Ricardian System," 1987, Quarterly Journal of Economics. Besides showing his links with the neo-Ricardian school of Sraffians, it showed how chaotic dynamics can arise from that model, something of considerable interest to me.

An unfortunate matter is that apparent the father and daughter are not on particularly good terms right now.  Some of this may reflect actual political differences, with him probably to the left of her.  But most seem to think that it mostly has to do with the apparently bad divorce between Kamala's parents, with her and her sister going with their mother, who was from Tamil Nadu in India.  BTW, Kamala's sister resembles their late mother, while in fact Kamala looks like Don.

More recently there was a contretemps over marijuana, which Kamala supports legalizing, even though she put pot smokers in jail back when she was DA in San Francisco, even though she has admitted having smoked pot herself.  In an event in New York she was asked about this and said "Of course I am for legalization, I am from Jamaica" or something like that.  This upset Don, who is proud of his family background in Jamaica, which is quite elite actually, with him a very proper person personally, despite his leftist politics.  I do hope they overcome their differences so he can stand up for her, especially given that her mother is no longer around to do so.

Barkley Rosser

"Executive Oder" Versus "Executive Action" Such As A Memorandum

 Most o the  news media has reported that President Donald J. Trump has signed four "executive orders" involving extending unemployment benefits at a $400 rate, deferring (or ending?) payroll taxes for Social Security (opposed by both parties in Congress), extending a ban on evicting renters, and extending student loan deferments.  An important detail not mentioned in most reports that of these three of them are not actual orders but rather memoranda, which can count as "acrtions," that essentially implore others to do something that requires Congressional action in order to be done, basically the first two of these, or is already happening (deferment of student loans, although this is complicated).  Only one of them is an actual order that must be followed, the one regarding evicting renters, although all this order does is to make HUD "consider" extending the ban on evicting renters.  The order itself does not actually do it.  In short, these orders amount to a campaign list of wannabe actions, no actual real actions.

This is all obviously the brainchild of the incompetent and brainless Chief of Staff, Mark Meadows, who is apparently incapable of making any deals and totally focused on the reelection campaign.  So he "blew up" the two week negotiations with Congressional leaders by most accounts by making rigid demands.  I am not going into details, but there were obvious compromises available, just to pick one on the total size of the relief package.  The Dems were proposing $3 trillion based on what the House passed months ago while the White House and some GOPs held to $1 trillion. Reportedly the Dems offered the obvious compromise of $2 trillion, but that was blocked by Meadows who simply made demands and warned if they were not accepted, Trump would issue "executive orders" to do what he wants.  But, as careful analysis shows, only one of these is ab actual order, and even the one that is an order that only orders a department to consider doing something.

Reportedly the final sticking point in the negotiations on Friday involved aid to state and local governments, which was a third of the Obama fiscal stimulus in 2009. I have signed a petition by economists going around calling for more such aid.  There was some in the first aid package, but it is pretty much gone.  Apparently the GOP offered $150 billion while the Dems asked for $915 billion.  There were other issues on which they were divided, but reportedly that was one there was no budging on.  Apparently the Trumpists still think that only Blue states are being damaged by the coronavirus and the bad economy. There are also reports that a major reason Trump has done so little to combat the virus has been that he wants to blame all the problems on the governors, somehow thinking it will only be the Dem governors (and mayors).  Little does he seem to realize that for better or worse people will be holding him responsible for how this all turns out.

Barkley Rosser

Interpol Supports Murder Charge Against MbS

 In today's Washington Post David Ignatius reports that Interpol refused a request from Saudi Crown Prince Mohammed bin Salman (MbS) to extradite Saad Aljabri to Saudi Arabia from Canada in 2017. MbS had been trying to entice Aljabri to return and had arrested his children, who remain arrested despite complaints from the US government and basically the entire rest of the world. Aljabri was the top aide of MbS's rival, the former Crown Prince, Mohammed bin Nayef (MbN), who was overthrown by MbS in a coup. Aljabri and MbN were highly regarded by officials in the US of several administrations, as well as orther governments, and apparently was personally responsible for blocking a serious possible terrorist attack in the US.  

After Interpol refused to extradite Aljabri from Toronto, MbS sent a crew to kill him. This was two months after MbS sent such a crew to Istanbul to kill and dismember Kamal Khashoggi, a columnist for the Washington Post.  Aljabri warned the Canadian government they were coming and the team was detained at the Toronto airport, where they were found to have exactly the same implements that were used to dismember Khashoggi.  

Aljabri is now suing MbS in US courts for trying to kill him.  MbS has claimed that Aljabri stole funds, but Aljabri says this is a false claim.  Ignatius notes that MbS will have to produce his claims, and the big deal here is that up until now the Interpol report was not public.  They refused MbS's extradition request on this claim, and their report makes it clear that much lies behind their decision, including massive violations of human rights in Saudi Arabia by the murderer, MbS.

Barkley Rosser