November 10, 2009
Let’s Come Clean: The Left is Economically Illiterate and (Almost Totally) Devoid of Ideas
People who read this blog tell me it’s angry. Normally I don’t realise. Today I do.
Yesterday on Liberal Conspiracy there was a post by Adam Lent entitled “Where is the left’s new economic map?” Now Adam, I have nothing against you (whoever you are). But I’m afraid you are in the wrong place at the wrong time, and are going to kop it accordingly. For I am sick to death of the left’s endless economic illiteracy, its spouting of grand-sounding rhetoric with no underlying substance, and its almost complete lack of any concrete proposals what-so-ever.
Let’s start with Lent’s piece. He wants to run an analogy whereby “neoliberalism” (whatever that might be) is compared to a “road map” printed 40 years ago which has caused us to drive our car into a ditch. Ignoring the obvious point that any driver who only follows a road map and doesn’t look where they’re going deserves to end up in a ditch, I’m affraid I have to be rude: such an analogy could only be advanced by somebody who either knows nothing about economics, or has decided to popularise the discussion to such a base level that it becomes devoid of intellectual worth.
“Neoliberalism” was not erected – a set in stone monolith – 40 years ago, to be left unchanged ever since. Economic theory and practice is evolving and changing all the time. The general paradigm might be something we term “neoliberal” (whatever that might actually mean) but the idea that economic theory and practice – note, theory and practice, i.e. something rather unlike a simple map – can be reduced to such a banal metaphor is indicative of the level of discourse being employed.
Second point: the article gestures at some big name (apparently) leftist economists and claims they’ve “had an impact”, but offers no concrete proposals about what to do at all. Rather, the piece consists of two things: a bad metaphor, and a cry that Something Must Be Done!
Now, in itself there’s nothing wrong with calling that something must be done. I’ve engaged in that myself. But it becomes a problem when that is all that is ever being offered. Sorry, Adam, for picking on your piece. There are thousands of effectively identical ones littered across the internet: leftist blogs and newspaper columns hand-waving about evil “neoliberalism” and crying for somebody to do something.
Do what, exactly?
There’s a good reason I do most of my economic reading on non-leftist blogs. It’s because the vast majority of people who understand economics, and have anything concrete whatsoever to say about recovery and paradigm shift, just aren’t on the left. It’s those bloggers that have academic and working knowledge of economic theory and practice. It’s those bloggers who, for example, are aware of basic truths about our collective economic history. For example that Keynes offered his General Theory not as a leftist alternative to the right (whatever that is supposed to mean), but was in fact intended to rescue liberal capitalist democracy from the twin threats of communism and fascism during a period of economic havoc when capitalism looked like it was about to kick the bucket. And that’s exactly what it did: Keynesianism saved capitalism. That it later became bound-up with welfarism and a suspect narrative about a centrist/leftist “Keynesian consensus” is an altogether different – and stranger – story.
Yet this problem of intellectual economic shortfall on the left is not confined to the “blogosphere” by any means. Although I greatly enjoyed the Fabian Society conference on Saturday, this problem of the left’s just having no coherent or concrete proposals about what to do regarding the great big economic mess was prominently on display there as well.
In the afternoon debate, entitled “Progressive Economy: How to Get There”, the panelists spent about an hour switching between sensible discussion of how to think about climate change, and rather less substantive gesturing about economics. There was lots of “we mustn’t let a good crisis go to waste!” and “we must meet people where they are, not where we want them to be!” and “we must be willing to consider radical solutions!”. But how we might avoid letting the crisis go to waste, where we want to take people once we’ve met them, and what the radical solutions might be was all left conspicuously unsaid.
So I raised this point, and probably did it a little too angrily (I tried to apologise to the panelists afterwards, but missed some of them). My basic problem was that the debate was supposed to be about how the left (or “progressives” to use that silly word) can offer alternatives to a system perceived to have failed. Yet no concrete proposals what-so-ever had actually been made – and it seemed very much to be because nobody had any.
With my frustration being helpfully refined by another member of the audience, the panelists were asked to offer the 1 concrete proposal they thought was most important. Eugenie Harvey, director of climate change action group 10:10, offered a very sensible idea about personal carbon allowances . But unfortunately this simply re-inforced the problem that throughout the debate the issues of preventing climate change and finding alternative leftist economic strategies were consistently run together as though they are identical. (Hint: they may not be. Imagine a dictator who ends climate change by enslaving the entire world population and preventing all carbon use accordingly).
Richard Millar of ActionAid said some very sensible and extremely commendable things about how reform of tax systems – domestically and abroad – can actualise important social change in favour of equality, and end developing world dependency on foreign aid. Unfortunately, he prefaced it with a response to me that we need to find “alternative models of growth” without saying what on earth those models might be.
However, there was something to be very positive about. Finishing things off, Anthony Painter offered a genuine concrete proposal – albeit an embryonic one – as to how we can reconceptualize economic organisation. The idea is what has been referred to by others as the “John Lewis Approach”: giving individual workers direct stakes in the companies and – so as to cover the public sector – institutions they work for. There seems to be some evidence (e.g. John Lewis) that firms which are employee-owned not only act more responsibly and look after their staff well (who are themselves often happier), they are also stable and successful economic actors. This possibility is very exciting. As Anthony Painter stressed, it is not “socialism”, which posits collective ownership through the proxy of the state (i.e. the state owns things in our names). Rather, this “John Lewis” approach posits collective ownership in an altogether more direct way: firms and institutions owned by the people who work for and run them. So I guess you could call it socialism, Jim, but certainly not as we know it.
I find that exciting, and something I can get my teeth into. When I have the time, this is where my reading will be directed. So the left – it turns out – does have an idea. And it’s a potentially big one, even if right now it’s only a glint in the ideologues’ eye. But we need to start chasing it up, finding out more of the messy details, and seeing if it can really work. Simultaneously, we need to stop writing and shouting vacuous, ill-informed, economically-illiterate but self-congratulatory nonsense about “grasping the moment of change” and “overturning the neo-liberal consensus”.
It’s time to get educated. Whilst I go and read about “John Lewis” approaches, why don’t some of you young bucks go and get economics degress? Then, in a few years time, we’ll have a fighting chance of change.
–
Appendix
Why do noticably few people on the left understand economics beyond a crude A-Level standard? Here’s my grand theory of explanation, which is probably wrong.
The dominant approach of the last 30-40 years which can probably safely be described as a combination of “neoclassicalism” and “monetarism” (which usually gets crudely described as “neoliberalism”, which in fact is properly understood as a political programme as well as an economic one) has been characterised by two things.
Firstly, the dominance of mathematics and the belief that economic principles can be reduced to a science. Secondly, the predominance of rightist economists (Friedman being your obvious example). Those who are not extremely competent at mathematics cannot progress in the discipline (e.g. me). Of those that remain, relatively few will be overtly political, one way or the other (they will mostly be interested in, erm, maths). As a result, the vast majority of economists that emerge trained from the academy are either rightists to begin with, or are turned that way by the tendency towards rightwing orthodoxy latent within the modern discipline. This is because economics tends to exaggerate the pre-occupations of the Chicago school thinkers who initially brought forth the Keynesian-replacing neoclassical/monetarist approaches, whilst simultaneously keeping up the pretension that the discipline is a non-ideological science which just reports the facts as they are found in the world. Net result: very few left-wing economists trained within the last 30 years, and even fewer who are competent within the discipline, and even fewer again who (due to institutional biases) succeed in raising to a position of influence or public prominence.
And this matters. The left is not going to shift any paradigms if nobody on the left knows what the paradigms are or how they work.
“Oh mother, tell my sister/ Not to do what I have done/ Don’t drop economics to piss around in philosophy/ If you want, to change, the world”.
Leo said,
November 10, 2009 at 12:43 pm
Isn’t the “John Lewis approach” simply the co-operative movement by another name? John Stuart Mill was advocating that around 150 years ago, so it can hardly be called a new and radical idea. Nevertheless, yes it is a sensible idea.
I’d add to what you say by pointing out that i think there has been an over-reliance on economics in the past 30 years, specifically on normative issues. It seems to be taken as a given that the most economically efficient thing to do equals the most ethical thing to do, or at least the thing governments should do. Clearly this has two problems – first, it fauls foul of the naturalistic fallacy; second, it assumes that economic growth is the single goal towards which every aspect of public policy must be oriented, and it does so on the assumption that “a rising tide lifts all boats” as JFK once famously said.
Unfortunately, that thesis has been disproven several times over. The latest demonstration of the bankruptcy of that theory occurs in a new book called The Spirit Level, which you might have heard of already; look it up on Amazon – it’s worth a read.
Even if economic growth Did lead to the best outcomes in broader sense – tackling a variety of social issues and so on – it still wouldn’t necessarily be the right thing to do. I’d argue that the Left needs to shift the discourse away from this utilitarian conception of government, and towards one where the debate is about the most just distribution of resources. The academic developments in liberal political theory hardly point to a left devoid of ideas; they merely demonstrate further that liberal theorists have been writing book after book and nobody has been reading them – in this country at least.
To my mind, if the left coalesces around any new set of ideas, it’ll be the left-liberalism of theorists of distributive justice like Rawls and Dworkin. “Contemporary Political Philosophy: An Introduction” by Will Kymlicka will give you a flavour of the ideas about at the moment. I’m kind of surprised how few left-wingers have read any of this stuff, to be honest..
chris said,
November 10, 2009 at 1:09 pm
I wholly share your frustration with those lefties who wibble about neoliberalism. I fear they are guilty of two errors.
One is “big think” – the search for grand theories. This is against the spirit of today’s economics, which is rooted in empiricism and analysis of individual issues.
The other is a belief that the solutions lie in what the state should do to manage the economy. But what if statism isn’t the answer?
I think you’re wholly right to say the answer might instead lie with the “John Lewis” approach. I’d push this to an extreme, and demand the subordination of management to worker control.
What’s wrong with my socialist ideal, which envisage worker coops (with a variety of structures) operating in a market economy, subject to Shiller-style insurance mechanisms and a citizens’ basic income – which, Leo, has an easy Dworkinesque justification?
Paul said,
November 10, 2009 at 1:57 pm
Paul
The best thing you’ve written on oyur new blog. Well done.
I looked at Adam’s post, in the light of Sunny’s comment on TCF that he’d be running a ‘whither the left’ week at Libcon, and thought ‘FFS; if that the best we can do…..’
I’d done my ‘new economic narrative’ on Libcon a couple of months earlier (though the somewhat more substantive pre-sunny-edit version is at http://www.bickerstafferecord.org.uk/?p=1066) and what I tried to set out was the substantive link between a socialist/redistribution agenda and a workable economy even within a capitalist paradigm. It wasn’t gthe best thing I’ve ever written, but I remembered having written it when I saw Adam’s piece because I felt that as the Left it signified we’re going backwards in our argument, not forwards (at least on LibCon)’ sure the rightists commenting on my (heavilyi edited) article at LibCon were dismissive, but they engaged more with the core ‘this is what we should do’ argument than they did with Adam’s piece, out of which they simply took the piss.
I’m not an economist – I’m a nurse – but i have tried hard in the last two or three years to understand the basics of the current paradigm so that I can conceptualise a future beyond it. I simply don’t understand how other leftists can go about their leftery without engaging with the maths and the logic; sure, the algebra is hard and it doesn’t come naturally to me, but i’ve tried to learn it as it seems to me that you can’t no if you’re seriously about left economics
Tweets that mention Let’s Come Clean: The Left is Economically Illiterate and (Almost Totally) Devoid of Ideas « Bad Conscience -- Topsy.com said,
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[...] This post was mentioned on Twitter by Anthony Painter, Claire Spencer. Claire Spencer said: I must say, @paul_sagar's post is well worth a read – and his question at #changeweneed made for a thoughtful ending: http://bit.ly/49rQgw [...]
Dave Semple said,
November 10, 2009 at 2:15 pm
This is all very well – and we could do worse than pointing Lefties at Tim Worstall’s reply on that LibCon thread and asking that they knock down his assertions as a good way to understand where the libertarian-right are coming from. Nevertheless, it hardly seems something to get worked up over?
I freely admit to understanding economics only in the rudiments. And I’m always pleased when Chris Dillow or someone else posts up analysis of the directions of Keynesian theory these days. There should be more discussion of this – so Paul S., why don’t you continue to provide it?
And leave knocking down some of the more ridiculous posts at LibCon to the troll brigade.
Paul Sagar said,
November 10, 2009 at 2:22 pm
Leo,
Thanks for commenting. But maybe refrain from handing out reading lists in future, hmm? I see from your I.P. address that you’re based at St Anne’s, Oxford. I deduce from your post that you’re reading PPE.
Good for you. But do bear in mind that – contrary to the overwhelming impression that being a male PPE student at Oxford you already know everything – that other people read books too. And may well have read them whilst, er, studying PPE. At Oxford. Before you.
Chris,
I can see no problem with it at present – but then, I don’t know much at all about this stuff. Another avenue to explore, no doubt.
Paul,
Thanks for the kind words. I wish I had your energy to explore economics, to be honest. Indeed, it may be worth pointing out to lots of people that Marx didn’t just pull Kapital out of his arse (whatever its failings), he went away and studied economics for 20 years in the British library first. We could put that spirit of Marxism to good effect, certainly.
Paul Sagar said,
November 10, 2009 at 2:27 pm
Dave,
I intend to (and I think sometimes I do). But I do think this is a more serious problem than you do: whilst the left is squaking about “not letting a good crisis go to waste” and bleating about “neoliberalism” (without any understanding of what that term might mean), two things happen: 1. genuine positive proposals are neither advanced nor debated BUT 2. everyone gets to feel good about the fact they are bashing the right and shouting Something Must Be Done!
The result is impotence, stagnation and the ceding of any chance for change to those who will certainly graps the reigns, but direct the cart in directions we don’t really want it to go.
I picked on the Lent piece because it really got up be nose, but as I say in the OP it’s symptomatic of a much wider trend: the fact that the left is economically illiterate, ill-informed, complacent and directionless when it comes to economics. We need to admit that, and build.
It’s ok to pick on one LibCon article to make that point, surely?
Though I’m perplexed by your willingness to admit a lack of knowledge of economics and sound quite content with that. Marx wasn’t content with that, and that’s why he spent 2 decades educating himself in the classical political-economic theory of his day before producing his own alternative.
chris said,
November 10, 2009 at 2:47 pm
Thanks for those words of encouragement, Dave. I don’t do much macro on my blog, as I tend to save that for the day job. But…
I would question Paul’s view that economists are mostly rightists. In my experience, many economists are not political (whence the inspiration for “post-autistic economics”) or are anti-party political (the public choice lot), or have vaguely liberal lefty leanings, and some of us still consider ourselves Marxists! Very few indeed are enthusiastic Tories.
Paul Sagar said,
November 10, 2009 at 2:50 pm
Chris,
My point was that because of the monetarist and neoclassical paradigms in which most economists are educated (esp at undergraduate), this cashes-out at the end of the day in terms of lots of economists with right-leaning assumptions (though many of them won’t realise it). Hence I would dispute that your “not political” and “anti-political party” lot are simply apolitical; lying beneath that are likely to be the effects of having imbibed ideological and political dispositions latent within a discipline which misleadingly presents itself as value-free science.
Leo said,
November 10, 2009 at 3:13 pm
Well if that’s the case then i’m fairly surprised to see an old PPE-ist declaring “it’s time to get educated” with regards to an idea that Mill talks about quite a lot, and that is therefore familiar to anyone doing the PPE Prelims course.
Just saying..
Dave Semple said,
November 10, 2009 at 3:38 pm
I’m not content with my own lack of knowledge, Paul – but there are only so many hours in a day, and the last year or so my knowledge has been developing rapidly in the epistemological underpinnings of Marxism – materialism and the dialectic, for example.
I know enough, from people like David Harvey, Marx’ first volume of capital, the few of the physiocrats whom I have read and the Financial Times to keep broadly abreast of what is going on. But in the meantime, I rely on well-informed commentary from others, just as, no doubt, others rely on me for some types of commentary.
But you’re right in your assessment of how much importance we seem to place in the issue. Broadly speaking, I know that the sort of response that can build an effective mass movement operates independently of the minutia of economists and knowledge thereof, in many respects.
When it comes to what we do with such a movement, some of the demands are already formulated in advance – about jobs, nationalisation and so on – and that’s enough to be getting on with, really, since we haven’t even got to the mass movement part yet, just sporadic strikes and protests.
That’s why I don’t think it’s particularly urgent to attack people for a lackadaisical understanding of economics beyond A-level, anymore than I would castigate someone for failure to understand Lenin’s critique of Mach and Avenarius.
Dan said,
November 10, 2009 at 3:49 pm
Interesting post.
Although you rightly criticize the use of the term “neo-liberal” I think it goes further than that – the more I hear it, the more I am convinced that it is simply a slur used by the left against those who are loosely in favour of markets rather than anything of any actual analytical use. A lot of folks seem to lump in Friedman and Hayek as paradigmatically “neo-liberal,” while, although they agreed in many of their policy recommendations, their economic philosophies and methodologies were as different as night and day. So it sounds a bit funny to me when people rail against “neo-liberal economics” as though it actually denotes something other than a liking for markets.
Secondly, although the more lefties who see the state as providing more problems than solutions the better, I wonder if your enthusiasm for worker-management is justified. It sounds awfully like ideas of ‘market socialism’ to me, and I’d highly recommend De Jasay’s devastating essay on the topic here: http://oll.libertyfund.org/?option=com_staticxt&staticfile=show.php%3Ftitle=1306&chapter=137802&layout=html&Itemid=27
Paul Sagar said,
November 10, 2009 at 4:06 pm
Leo,
Well seen as you want to keep using the example of Mill, let’s do a little analysis. Mill certainly does refer to some sort of worker-owned system of social organisation. Indeed, it’s part of the reason he calls himself a socialist. Of course, another part of the reason is that he sought to appropriate the word for his brand of liberalism, as a way of undercutting and heading-off the kind of French Utopian socialism he perceived to be quite dangerous (and a bit mad).
But is it really like what we could possibly be proposing (or one day hope to propose?) for modern 21st century politico-socio-economic organisation? It seems pretty unlikely. Mill was writing during the apex of mass industrialised capitalism, when production and manufacturing looked and were radically different to how they are constituted now. The limited liability corporation – let alone the globe-spanning, border hoping, hundred-subsidiary-owning mega corporation – had yet to come into existence. The welfare state was 100 years away, and for the most part laws to regulate the treatment of employees were largely non-existant. Public institutions were much smaller than today (the bureaucracy had yet to rise), and policy makers still lacked any clear understanding of macroeconomic policy management (indeed, much of Mill’s writing – i.e. what you don’t meet in your 8 weeks before prelims – was dedicated to providing a system of workable political economy).
That Mill advocated ideas about worker ownership which look superficially like the modern proto-idea of “John Lewis” ownership is no guide to believing that the ideas are the same, or that the latter is not really new. There’s too much history and change in between to make that kind of epoch-spanning narrative in defiance of enormous change and history.
But what I was objecting to wasn’t really your citation of Mill (crude and ill-informed as it must inevitably be, if all you are going on is the surface-level introduction to Mill that you get in first year PPE). It was more your deigning to hand me your second year theory of politics reading list as though it contained great pearls of wisdom of which you assumed me to be ignorant.
Having said that, I really shouldn’t be getting so annoyed with you. I’m just grumpy because I’m trying to write a PhD proposal (for Cambridge, on David Hume’s political theory of obligation, since you ask) and it’s going very badly.
So sorry for being grumpy. But don’t hand me reading lists if those reading lists consist of the basic introductory texts I read 4 years ago.
Paul Sagar said,
November 10, 2009 at 4:10 pm
Dave,
Sorry, didn’t mean to come across snarky a-la-Worstall about what we all have and haven’t read. Indeed I sympathise; I feel horribly under-informed about a million and one things and wish I knew more. And of course you can’t be expected to become some sort of expert in everything economic (especially if you think Marx got it mostly right).
I guess we have to agree to disagree in some respects, but I agree with you that building a mass movement for change is important. I just think that a working knowledge of economics and positive proposals for altering the present system are a prerequisite for any successful mass movement of change, really.
Paul Sagar said,
November 10, 2009 at 4:13 pm
Dan,
Long time, no comment.
Yes, the term “neoliberal” is flung about in an utterly banal and idiotic way, mostly. I think it can be used to denote something meaningful, but it very rarely is. And a slur it has become (though I’m not necessarily against it being a slur).
I will add that article to the reading list (though may be a long while before I get a chance). I note it’s at the liberty fund website. I’m sure you’ll be pleased to know that I’ve become a somewhat reluctant convert to the wonders of the Liberty Fund. They may be from your crew of nutters, but god damn do they produce nice editions of brilliant works at ridiculously low prices.
Leo said,
November 10, 2009 at 4:26 pm
Paul,
If my assumption, which i’m happy to correct, was that you were unfamiliar with contemporary liberal theory and so forth, yours is quite clearly that a 1st year PPE-ist is unfamiliar with anything they haven’t studied for their course. As it happens, i’ve read Mill’s Principles of Political Economy and his Chapters on Socialism, so i’m pretty familiar with what Mill was advocating.
It seems to me that, as with much of what Mill advocated, British society has of course changed considerably since when he was writing, especially in the structure and law surrounding private companies; nevertheless, the central idea of a co-operative, such as he lays out in the Chapters on Socialism (and, i think, early on in the PoPE), is essentially what you’re advocating. Clearly if someone now advocated the principle of tolerance of minority views he advocated then, the detail of the policy involved would be substantially different in a number of respects, but we would nevertheless probably not say that the contemporary advocate of the principle was advocating a principle noticeably different to what Mill was proposing.
As for my handing you my “second theory of politics reading list as though it contained great pearls of wisdom…”, again, that’s surely an assumption of the same kind you’ve just castigated me for. I read that book before i’d even got my 1st year reading list, and i did so because i was looking for a book that looked at the state of contemporary left-wing political theory. I was merely suggesting you read it on the basis that, given you were claiming “the left is…devoid of ideas”, that book clearly demonstrated to me that that is not the case. Therefore, to my mind, you were either, (1) ignorant of the ideas that book laid out, (2) aware of those ideas but unsatisfied by them, or (3) aware of those ideas, but actually lamenting the fact that most left-wing people are unaware of them. Given the absence of evidence to support explanations 2 and 3 in your above post, i (clearly erroneously) assumed (1) to be the case. Sorry again. Still, good luck with the PhD proposal.
Paul Sagar said,
November 10, 2009 at 4:50 pm
Deleted on account of being needlessly unpleasant and petty. I have excuses, but they’re bad ones.
Apologies.
Paul Sagar said,
November 10, 2009 at 4:53 pm
Deleted on account of being needlessly unpleasant and petty. I have excuses, but they’re bad ones.
Apologies.
Leo said,
November 10, 2009 at 5:22 pm
Ok look Paul, i can see why you felt patronised, which is why i just apologised (twice). Is there really any need to be offensive and patronising in response to that?
Leo said,
November 10, 2009 at 5:25 pm
And for the record, i was including the chapters on Marxism, Communitarianism, Feminism and just about everything else (bar the Libertarianism stuff) when i referred to ‘the state of contemporary left-wing political theory’.
Dan said,
November 10, 2009 at 5:30 pm
My post clearly complains that the left is devoid of economic ideas. Which it is. Nothing in my post aluded to a deficiency of political theoretic ideas on the left (that is manifestly not the case).
At the risk of interrupting quite a funny argument, I’m not sure that it’s so easy to separate out the two. Take the example of Jerry Cohen, who you mentioned earlier, and who is (or was) plausibly one of the most convincing political theorists on the left. You can have as immensely sophisticated a version of egalitarian Rawlsianism (as, for example, in Rescuing Justice and Equality) as you like, but what good does it do if the practical consequences boil down basically to “people should be willing to do more for other people”?
Paul Sagar said,
November 10, 2009 at 6:02 pm
Leo,
You are right – and I’m sorry for the jibes. They really are needless and i’ve deleted them because they’re nasty and pointless. I’m just having a really bad day, sorry.
Dan,
Well yes, quite.
I was thinking about this earlier: what use is TofJ if there is no story – or no plausible story – about how to put it into practice in terms of what we’d need to do to our economic systems, and all we can come up with is, as you say, “let’s be nice to each other”.
(But that would seem to strengthen my case, vis-a-vis Leo: if the left has no ideas about economics, then what use are its ideas in the political theoretic?)
Nigel Stanley said,
November 10, 2009 at 6:45 pm
Oh dear!
Adam seems to have caught you on a bad day.
But if you read his post, it’s clear that its main purpose is to encourage people to attend the TUC’s economic conference, Beyond Crisis, next Monday – and not to set out all the answers in his post.
Indeed look at the TUC Touchstone blog for a series of contributions to that debate – or indeed come to the conference where there will be a full day of debate. Like you I hope much of it will be on practical policies (which, by the way, the TUC produces on a regular basis.)
Perhaps Paul you will have worked out how to “John Lewis-ise” the entire economy by then – I’d be interested to hear how you’d cope with multinationals – and can contribute.
Labels can often obscure and confuse. But I see nothing wrong with using neo-liberal as shorthand for the consensus view among economic policy makers in the UK and US for the last few decades, that free markets and deregulation rule.
Grace said,
November 10, 2009 at 9:42 pm
I’m so excited that i will be (hopefully) studying economics this time next year!
Paul Sagar said,
November 10, 2009 at 10:39 pm
That excitement is in for a nasty shock when you get under way with the full throttle boredom of the dull science.
I didn’t drop it for no reason…
Grace said,
November 10, 2009 at 11:20 pm
oh dear – given that i’ve applied for 3 universities where i’d have to do economics the whole way through, i had better enjoy it!
though i do like maths though, and had a look at varian the other day, didn’t look half as bad as i had heard. maybe it won’t be so bad
and there’s always the incentive of being able to understand books like roemer’s “theories of distributive justice”, it’s so so frustrating that it’s like reading a book in a different language! the things he’s discussing are so relevant to philosophy as well
wouldn’t a knowledge of game theory etc be helpful in some bits of philosophy, eg roemer proved (or said he did, couldn’t understand maths) that joint ownership of land would mean that self-ownership had no distributive consequences using game theoryish maths
Peter said,
November 10, 2009 at 11:33 pm
Dan,
“At the risk of interrupting quite a funny argument, I’m not sure that it’s so easy to separate out the two. Take the example of Jerry Cohen, who you mentioned earlier, and who is (or was) plausibly one of the most convincing political theorists on the left. You can have as immensely sophisticated a version of egalitarian Rawlsianism (as, for example, in Rescuing Justice and Equality) as you like, but what good does it do if the practical consequences boil down basically to “people should be willing to do more for other people”?”
Grace,
If you like maths and are good at it, you may well enjoy economics. I didn’t like maths, and I wasn’t very good at it (didn’t have A-level). Hence I was crap at economics and I didn’t enjoy it (and so, like Paul, I dropped it at the first opportunity and basically did a Philosophy degree). You will almost certainly be different though, so don’t let mine and Paul’s limited experience put you off!
- I don’t think that that’s the only practical consequence of Rawls. One practical consequence is that govts would seriously have to investigate which policies were of most advantage to the least advantaged. Whereas now, no govts (even Labour govts) really care terribly much for the least advantaged.
And in any case – Rawls didn’t write ToJ so that we could have a handbook for govt with simple step-by-step guidelines as to what to do. That’s not what political philosophy is about. Rather, he is trying to flag up important moral considerations that intelligent, educated, and morally attuned voters should keep in mind when they cast their ballot.
Peter said,
November 10, 2009 at 11:34 pm
EDIT: I messed up my above comment. It’s pretty obvious which bits are in response to Dan though, and which to Grace.
Grace said,
November 12, 2009 at 9:08 pm
Actually, I think you’ve missed something.
If you want to see the very opposite of “grand-sounding rhetoric with no underlying substance and… almost complete lack of any concrete proposals what-so-ever” look at socialist anarchism/left-libertarianism, especially the articles on http://all-left.net/. breath of fresh air after the drivel produced by people like compass! i especially like roderick long and kevin carson.
for example
“corporations versus the market” http://www.cato-unbound.org/2008/11/10/roderick-long/corporations-versus-the-market-or-whip-conflation-now
http://mutualist.blogspot.com/2007/11/naomi-klein-shock-doctrine.html
“Equality: the unknown ideal” (or why libertarians are the real egalitarians) http://mises.org/story/804
“Free the unions” http://radgeek.com/gt/2004/05/01/free_the
“How Government Solved the Health Care Crisis. Medical Insurance that Worked — Until Government “Fixed” It” http://libertariannation.org/a/f12l3.html#top
sorry now i’m giving a reading list! for all i know you might have read this kind of stuff and rejected it, seeing great big gaping holes in the reasoning. who am i to suggest stuff.
It’s just that i’m *very* excited about all these ideas, they’re new to me (had only previously read otuska’s “libertarianism without inequality”). also this seems to combine all the attractive/plausible features of libertarianism – eg self-ownership, providing an underlying framework which means that your different political positions fit together, freedom – without nasty consequences (features of “vulgar libertarianism”) eg crushing labour.
Paul Sagar said,
November 12, 2009 at 10:06 pm
Grace,
The Cato Institute, von Mises, and the rest of that libertarian crew are very good at being seductive. In my (limited) experience though, they rely upon misrepresenting, distorting and masaging the evidence they like, whilst ignoring and/or distorting what they don’t.
Also bear in mind that they would have you believe that the only reason their “Austrian” economics isn’t accepted is because of some sort of conspiracy between big government and big business to freeze them out. How lovely! How neat! I think Giles at freethinkingeconomist has better answers: that the world is a hell of a lot more messy than they want it to be, but they are willing to ignore that consciously or otherwise (i’m putting words into his mouth, but there you go).
2 further things: 1. beware of why that lot are putting out publications that make all the nasty consequences of libertarianism go away; they know they are way off power at the moment, so have to sanitise themselves. 2. resist the urge to be on a quest to find a political theory that fits it all together and ties everything up happily with magic solutions and happy-ever-after endings. If the libertarians are saying they can give you the sort of radical freedom of individual non-interference they agitate for, whilst avoiding all the horrific up-shots of their state minimalism (roughly: the poor dying in the streets, their children uneducated and the market ruling over us all as we are told that power differentials arising from wealth and resource inequality are a figment of our imaginations), then it’s almost certainly too good to be true simply on the grounds that no ideology holds that many cards. It’s about picking one with better hands; the libertarians want to say they’ve got extra cards up their sleeves. I’d recommend deep scepticism.
In sum: the “vulgar” versus “sophisticated” libertarianism is likely to be a false dichotomy. Libertarianism in its intellectual form is always sophisticated – but that doesn’t mean it’s what we’d want to happen…
Paul Sagar said,
November 12, 2009 at 10:11 pm
OK, had a look at the Von Mises institute link: it’s complete and total and utter drivel. It relies on flagrant (or simply idiotic) misreadings of Locke, and begs a whole bunch of questions about what “liberty” is in favour of whack-job libertarian preconceptions.
(No surprise there, given who the Von Mises lot are…)
Paul Sagar said,
November 12, 2009 at 10:14 pm
The Rad Geek one is just a load of raving about what that bloke thinks unions are/should be.
No concrete economic proposals from what I can see. I didn’t read it well enough to see if it was a plausible vision/reading of the history and status of the union/labour movement, but TBH i’m prima facie sceptical and my time is short these days.
What on earth that blog has to do with libertarianism, I have no idea. You seem to be conflating two very different ends of the political spectrum (remember: unions are most certainly banned under libertarianism due to the market-distorting effects)
Paul Sagar said,
November 12, 2009 at 10:22 pm
Roderick Long is right that consistent libertarians oppose big business – at least, from the comfort of their idealised paradigms.
Dan who comments here and myself have frequently established that “the left” and libertarianism share some common ground on this issue, as well as drug decriminalisation (and we agree that the left needs to be more aware of this than it is).
Long, however, is not telling you the whole story IMO. Quickly: his characterisation of “vulgar” libertarians is what you and I can just call “idiots”. He doesn’t want to call them that because he sees them as potential foot-soldiers in a libertarian long-game.
Second, and more important, ask yourself if libertarianism can consistently in the long run oppose big business outside of the static comfort of its paradigm. Given that the state has to be minimalist, 1) who breaks up the megacorporations? 2) who stops megacorporations coming into existence if the state is minimalist and does not interfere with the market? A state which has the power to enforce competition laws and prevent mergers – with all the legal rigmarole that will be behind this in a free society – is unlikely to be minimal, and neither is the bureaucracy it will spawn. 3) The libs want us to believe that private sector can provide education and healthcare so that the poor aren’t left to fester in their own filth in Libertopia. But if there’s a man on large corporations (lol @ the idea of a libertarian ban) how will the economies of scale be realised to provide healthcare and education, if not by the state (which is ruled out)? Answer: they won’t. The poor are abandoned.
Of course, the Libs have answers to all of this. But in my experience it’s invariably sophism.
Paul Sagar said,
November 12, 2009 at 10:28 pm
Christ, as for Long’s piece on healthcare, i only got 5 paragraphs in before the screaming idealised propaganda of it all made me close the browser.
If fraternal societies were so damn great, why did Britain feel the need to institute the NHS? And why does America prop-up the private health insurance system with billions in taxdollars? Oh, because it’s all the government’s fault yada yada yada.
Did you know? ALL THE WORLD’S PROBLEMS ARE THE FAULT OF GOVERNMENT!
Calluh-callegh, if we all just get rid of Government life will be one glorious paradise.
Christ these people are fucking weird. Seriously, why are you reading this stuff? There’s millions of good books out there you could spend your time with.
(Again, there are no definitive and easy political fix-its; anyone who tells you there is and that there is a consistent, one-size fits all narrative to underpin that politics is leading you up loopy-alley).
Grace said,
November 12, 2009 at 10:42 pm
“You seem to be conflating two very different ends of the political spectrum (remember: unions are most certainly banned under libertarianism due to the market-distorting effects)”
that blog is linked on the all-left.org (alliance of the libertarian left) site – support for radical unions etc is a key part (from what i can make out) of that type of libertarianism. definitely not true that this lot would ban them, (who would enforce the ban anyway since there’s no state?) – eg “unions: part of the market” http://www.libertyforall.net/?p=753
most of the articles on that site are in favour of anarchism so no minimal state, but i’m not sure there would be “megacorporations” that need to be broken. they’d say that the megacorporations owe their size to government intervention – eg walmart has received over $1bn in subsidies from govt, there’s some government program which pays for american multinationals to advertise abroad. also economies of scale aren’t the whole of the story, there are also diseconomies of scale, which hayek’s calcuation problem apparently suggests will be large http://www.fee.org/publications/the-freeman/article.asp?aid=8092
re education/health – dan’s probably linked these to you before, but james tooley at the university of newcastle has done lots of research into private provision of education in poor countries, http://www.ncl.ac.uk/ecls/staff/profile/james.tooley for articles, there are rather a lot. basically better results/quality of education in private schools, still affordable even for v. poor, more innovative. and healthcare, the last link in my first comment seems to suggest that it was working quite well in america, in fact too well – prices for doctors were too low, so they got govt involved and everything went wrong.
Paul Sagar said,
November 13, 2009 at 12:17 am
1. The left ‘libertarians’ you link to are a world away from the anti-state right libertarians you appear to want to lump them in with.
2. So what if it’s a fact that eg the us govt subsidises eg walmart? How do get from there to ‘oh libetarisnism specifically must have the answers(to everything)’, or even to ‘the answer must be laissez-faire market capitalism’??? I mean it’s just a bland observation as it stands; to get anything like libertarian conclusions you need to to a whole load of other reasoning. Similarly: do what if there are, sometimes, diseconomies of scale? What does that do to my point about economies of scale. As far as I can tell, it’s just another observation.
3. I find the toooley stuff pretty unpersuasive. Of course, if it appeals to you that maybe actually contrary to much observed experience of profit-driven entities, in the cases of education and health somehow the market will both provide to everyone and do provide at an affordable rate plus quality, then fine go that way. Whilst you’re at it, blame everything on the Government, and inform your assesment of US healthcare and it’s history on the ideologically-driven partisan ravings of obscure Internet pamphleteers. The world will be much less complicated, that’s for sure…
Mads said,
November 13, 2009 at 2:03 am
Good post, Paul. And one I think fits neatly with your Berlin Wall-post.
This is a late-comer, so I’ll just respond to the original post for now.
I am certainly economically illiterate, confessed, I try to read articles etc. on economics regularly, but they tend to be outside mainstream economics, which may be a good and a bad thing.
I think I basically agree with you, Paul, certainly with the Appendix. Example: as far as I know the official danish, and supposedly neutral, cousel of economists that guide both left and right governments on economic policy work with the basic assumption that any public or state intervention in the market will have negative effects on economic growth, as the market tends toward “natural”(?) equilibrium and the most efficient allocation of ressources/capital. Tacit, knowing or unknowing acceptance of such an assumption, among others, puts the (center-)left in a very difficult situation, that is mostly or always in the defensive. That is if it wants to challenge the hegemony of the market. I’m not saying such an assumption isn’t true, I wouldn’t know (but don’t think so), just that it should be acknowledged that it is challenged on empirical grounds instead of treating it as self-evident. If “the left” don’t know how to or wish to challenge such assumptions, then I guess it has to resort to empty rhetoric and phrases devoid of concrete proposals.
Ostrom and Alperovitz, I think, are two examples of ways to challenge prevailing economic assumptions (see below).
With regards to alternative models for growth (or non-growth!), a domestic approach that might be fruitful: the Sustainable Development Commision’s report “Prosperity without growth”. I have only read the summary, but it breaks with many of the basic assumptions underlying todays economy, as far as I can tell, and has far-reaching implications that would traditionally be termed leftist. Anybody have any experience with/knowledge of how this goes?
Elinor Ostrom who recently received the nobel memorial price in economic science. Her work has focused on how non-marked regulated ressources and activities have been effectively regulated by communities, collectives, states etc. Here’s a video talk: http://www.youtube.com/watch?v=ByXM47Ri1Kc, and here a summary of her book Governing the Commons: http://www.cooperationcommons.com/node/361
Secondly, Gar Alperovitz’s challenging conventional theories of how wealth is created in society (Labour theory of value and marginal utility I believe, from my limited knowledge of economic theory). Here’s a video talk: http://www.viddler.com/explore/com-wealth/videos/7/
(Maybe the only good reason for being “progressive” as such is if history is really progressing uni-linearly. Incidently, the committee justifying Ostroms price notes that she has shown how traditional (mongolian) ways of communal regulation of ressources have been more effective than both communist and privatized ways…)
Grace said,
November 13, 2009 at 10:02 am
1. i don’t want to “lump them in with” right-libertarians. where have you got this impression, i know they’re different
2. roderick long says this about megacorporations:
“The ability of colossal firms to exploit economies of scale is also limited in a free market, since beyond a certain point the benefits of size (e.g., reduced transaction costs) get outweighed by diseconomies of scale (e.g., calculational chaos stemming from absence of price feedback)—unless the state enables them to socialise these costs by immunising them from competition – e.g., by imposing fees, licensure requirements, capitalisation requirements, and other regulatory burdens that disproportionately impact newer, poorer entrants as opposed to richer, more established firms.” http://www.cato-unbound.org/2008/11/10/roderick-long/corporations-versus-the-market-or-whip-conflation-now
3. “contrary to much observed experience of profit-driven entities” – what’s his research if not “observed experience of profit-driven entities”? also your own experiences may not be 100% relevant becausewhat we have in the uk at the moment is not a free market, but corporatism (as long says in the above article). when firms are shielded from competition it’s not surprise they treat people badly etc.
it’s ok it’s fine if you find tooley “pretty unpersuasive”, but your personal feelings are not an argument against him – tell me where his analysis has gone wrong. you criticise the articles for being “ideologically-driven partisan ravings”, but sometimes (not saying this is necessarily the case here) pro-state lefties are just as guilty – extreme closed-mindedness – eg refusing to consider the arguments that the poor would be better off under free markets – just repeating “but you’d leave people to die in the streets”.
“obscure Internet pamphleteers” – they’re not all, roderick long is associate professor of philosophy at auburn university, for example.
and accepting this kind of stuff isn’t an easy way out – i don’t even properly accept it, but even now i’m feeling so so angry/frustrated/depressed by the fact that we’ll never see anything approaching a just society in this world. and i can’t do anything about it! for anarchists (as far as i can tell) working through the political system is futile and probably even wrong. some are more optimistic than me about the chances of persuading people through education etc, but status quo bias (and other biases) are immovable obstacles.
Paul Sagar said,
November 13, 2009 at 12:47 pm
Grace,
Re 1. you certainly appeared to be, from your initial post.
Re the rest: look, much of what you say is true. But im incredibly busy. I don’t have the luxury of time to read through libertarian documents and then sit down and provide you with detailed refutations of each one. All I can do is tell you that PERSONALLY in my experience I find this stuff unconvincing. If you feel differently, fine.
And maybe I’m missing out. maybe the libs are getting it all right. But right now I don’t have the time or inclinatio to pursue the issue further than I have, or to provide you with detailed counterexamples. Frankly, I’ve got better things to do with the little free time I have right now than to think about libertarians. So yes, intellectually, your points against me stand. I’m fine with that; I need a life as well as a disposition to political enquiry.
freethinkingeconomist said,
November 18, 2009 at 11:41 am
Great post Paul
“this problem of the left’s just having no coherent or concrete proposals about what to do regarding the great big economic mess was prominently on display there as well”
I would add that they need to achieve somehow their vague reconstruction of the world economy WITHOUT ANY FISCAL RESOURCES. Which will be interesting.
Also, I think you are somewhat charitable about the soft ideas like JOhn Lewis and their ability to bear much weight. How would a employee-owned idea replace, say, industrialised farming? Oil distribution? Concrete? All these vast industries, many of them just don’t suit a restructuring along some communistic ideas. And they are mostly ignored by far-out thinkers, because such thinkers are much more familiar with funky service industries than hard, efficient-use-of-capital businesses.
Also, by what means would a reconstruction take place? Suppose somebusybody worked out that Tescos should be like John Lewis. Would it be forcibly changed? What sort of expropriation would we have in mind?
I now have to ignore this thread as I have work to do . .. . where do you find the time??
Bill le Breton said,
November 18, 2009 at 9:50 pm
Let’s start with something slightly easier than an oil refinery, Giles.
Ten years ago I got very close to persuading the political leadership of a large city council to break up and mutualise (create social enterprises from) all its in-house services.
It would have been very easy to do under existing legislation. Here’s how. [But first, as size matters in limiting the tendency for hierarchical and bureaucratic practices to develop, it helps that the commissioners of services are broken up and decentralised.]
So, imagine a small neighbourhood, say based on the area around a park or a school catchment area or an urban village i.e. a place that already has an identity, a shared sense of place among its residents. Give that community a chance to elected an accountable group of citizens to make decisions and a devolved budget. The only stipulation is that for the first (say) five years the neighbourhood council has to ‘buy’ services from the local social enterprises/mutuals in that area.
Now, take the Council’s existing operations, split them up, mutualise them, with each ‘worker/member’ having a share each, encourage people to ‘join’ mutuals in their own neighbourhood, provide them with capital, working finance, advice and training in running their own concern (as a mutual) and give them a start-up five year contract to provide services to the neighbourhood council.
Simples.
Quizz Question: what links Stanley Spencer to John Lewis Partnership? Hint, it’s a place … oh! and Christine Keller.
P.S. I am not an Aristotlean, Paul S, even though I do think that active citizenship is humanising and, if that is not tautological, authenticating.
duncanseconomicblog said,
November 19, 2009 at 4:16 pm
Commenting very late… and speaking as yet another PPE-ist. Couldn’t resist this:
“The Oxford School of Politics, Philosophy and Economics is based on two unalterable principles: first, everything written about politics and philosophy by Karl Marx (1818-83) is out of date and dangerously biased, while everything written by John Stuart Mill (1806-73) is modern, vigorous and untainted by bias; secondly, everything written about economics by Karl Marx (1818-83) is out of date and dangerously biased, while everything written by Alfred Marshall (1842-1924) is modern, vigorous and untainted by bias.”
– Paul Foot, The Politics of Harold Wilson (1968)
Chris Brooke has the entire 1968 ‘The Poverty of PPE’ article on his blog.
http://virtualstoa.net/2008/03/03/the-poverty-of-ppe-editors-introduction/
Paul Sagar said,
November 19, 2009 at 5:57 pm
Bill, Giles – will try and reply in due course
Dunc – I was actually a student of Chris Brooke’s when he put all that stuff up. Guess what degree I was studying?
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Luis Enrique said,
February 1, 2010 at 4:28 pm
I wish I had time to say something more thoughtful about this – it’s a topic I think about a lot. In the meantime, here are some references you might find interesting.
Economics for people who Hate Capitalism is supposed to be a very good effort at “economics for lefties”, trying to show the lots of mainstream economics is perfectly amenable to left wing thought (and indeed, useful). (I’m not suggesting you need to read it Paul, but perhaps you might recommend it to lefties)
and this book review by the mighty Robert Solow contains what I thought was an extremely useful discussion of economics from first principles, and why mainstream economics isn’t inherently right wing.
Unfortunately many of blog debate come in the form of a right winger like Tim W trying to explain economics to a left winger, which does not make left wingers very receptive. I’m frequently taken to be a right winger by LC commentators
senusert said,
April 14, 2010 at 8:30 pm
I know it’s late but…
I wouldn’t say economics is particularly ideogical, Scott Sumner says that back in the day even Chicago had an even split between Republicans and Democrats. His blog is the Money Illusion.
Hell, even Paul Krugman argues economists have done 2 Good Things: demonstrating that markets work (Smith, Bastiat, Say, Marshall, Mill, Friedman) through price theory; and that business cycles can be tamed (Keynes qua Keynes). None of which is particularly unobjectionable.
Regarding maths: it’s just a tool used to perfectly understand, and ensure the truth of, the path from the if to the therefore. A lot of the time it’s just addition (accounting identities and the like) – taking scarcity of resources seriously.
Perhaps the left has so few policy reccomendations simply because they aren’t correct. There might might be wiggle room (see Paul Krugman on this) within the “markets are good for prosperity, and social organisation” paradigm, but nothing really radical. A trade off between humanity and efficiency and humanity perhaps? Perhaps there is one way to organise society to maximise human happiness, and the way of the Fabian society simply isn’t it.