It's hard for me to read this without thinking of Ken Rogoff's immortal open letter to Joseph Stiglitz. Consider this passage from Professor Cochrane:
As usual, academics need to waste two paragraphs before getting to the point, which starts in the first bullet. To really enjoy this delicious prose you have to first read it all in one place.
• Many colleagues are distressed by the notoriety of the Chicago School of Economics, especially throughout much of the global south, where they have often to defend the University's reputation in the face of its negative image. The effects of the neoliberal global order that has been put in place in recent decades, strongly buttressed by the Chicago School of Economics, have by no means been unequivocally positive. Many would argue that they have been negative for much of the world's population, leading to the weakening of a number of struggling local economies in the service of globalized capital, and many would question the substitution of monetization for democratization under the banner of "market democracy."
Yes, there are people left on the planet who write and think this way, and no, I'm not making this up. Let's read this more closely and try to figure out what it means.
"Many colleagues are distressed by the notoriety of the Chicago School of Economics, especially throughout much of the global south, where they have often to defend the University's reputation in the face of its negative image."
If you're wondering "what's their objection?", "how does a MFI hurt them?" you now have the answer. Translated, "when we go to fashionable lefty cocktail parties in Venezuela, it's embarrassing to admit who signs our paychecks." Interestingly, the hundred people who signed this didn't have the guts even to say "we," referring to some nebulous "they" as the subject of the sentence. Let's read this literally: "We don't really mind at all if there's a MFI on campus, but some of our other colleagues, who are too shy to sign this letter, find it all too embarrassing to admit where they work." If this is the reason for organizing a big protest perhaps someone has too much time on their hands.
"Global south"
I'll just pick on this one as a stand-in for all the jargon in this letter. What does this oxymoron mean, and why do the letter writers use it? We used to say what we meant, "poor countries. " That became unfashionable, in part because poverty is sometimes a bit of your own doing and not a state of pure victimhood. So, it became polite to call dysfunctional backwaters "developing." That was already a lie (or at best highly wishful thinking) since the whole point is that they aren't developing. But now bien-pensant circles don't want to endorse "development" as a worthwhile goal anymore. "South" - well, nice places like Australia, New Zealand and Chile are there too (at least from a curiously North-American and European-centric perspective). So now it's called "global south," which though rather poor as directions for actually getting anywhere, identifies the speaker as the caring sort of person who always uses the politically correct word.
"The effects of the neoliberal global order that has been put in place in recent decades...."
Notice the interesting verb tense. Let's call it the "accusatory passive." "Has been put in place.." By who, I (or any decent writer) would want to know? Unnamed dark forces are at work.
"Many would argue that they have been negative for much of
the world's population... weakening ... struggling local economies"
I can think of lots of words to describe what's going on in, say, China and India, as well as what happened previously to countries that adopted the "neoliberal global order" like Japan, Hong Kong, and South Korea. Billions of people are leading dramatically freer, healthier, longer and more prosperous lives than they were a generation ago.
Of course, we all face plenty of problems. I worry about environmental catastrophes, and their political, social and economic aftermath. Many people are suffering, primarily in pockets of kleptocracy and anarchy. Life's pretty bleak about 5 blocks west of the University of Chicago. In my professional life, I worry about inflation, chaotic markets, and their possible death by regulation. There is a lot for thoughtful economists and social scientists to do. But honestly, do we really yearn to send a billion Chinese back to their "local economies," trying to eke a meager living out of a quarter acre of rice paddy, under the iron grip of some local bureaucrat? I mean, the Mao caps and Che shirts are cool and all, but millions of people starved to death.
This is just the big lie theory at work. Say something often enough and people will start to believe it. It helps especially if what you say is vague and meaningless.
Why aren't there hordes of economists studying meaningful alternatives to market capitalism? Because we've been experimenting with various other systems--both localism and extreme centralization--for over a century, and the experiment produces the same damn result every single time: human lives that are nasty, brutish, and short. And no matter what the professors who signed the Milton Friedman letter may believe, we haven't discovered any alternative to neoliberal policies, other than "be sitting on commodities during a boom", which is good luck, but not really good advice. The problem with neoliberal policies was not that they drove people into poverty, but that they weren't nearly as effective at driving people out again as we once hoped. Yet they are still more effective than anything else we've tried.
Neoliberal policies are hated in poor countries because they are associated with economic pain. But the association in most peoples' mind runs the wrong way, as Ken Rogoff pointed out:
Governments typically come to the IMF for financial assistance when they are having trouble finding buyers for their debt and when the value of their money is falling. The Stiglitzian prescription is to raise the profile of fiscal deficits, that is, to issue more debt and to print more money. You seem to believe that if a distressed government issues more currency, its citizens will suddenly think it more valuable. You seem to believe that when investors are no longer willing to hold a government's debt, all that needs to be done is to increase the supply and it will sell like hot cakes. We at the IMF--no, make that we on the Planet Earth--have considerable experience suggesting otherwise. We earthlings have found that when a country in fiscal distress tries to escape by printing more money, inflation rises, often uncontrollably. Uncontrolled inflation strangles growth, hurting the entire populace but, especially the indigent. The laws of economics may be different in your part of the gamma quadrant, but around here we find that when an almost bankrupt government fails to credibly constrain the time profile of its fiscal deficits, things generally get worse instead of better.
People in Nigeria, for example, tend to blame the Western bailout in the 1980s for the economic misery that followed. But the economic misery was the result of the collapse in oil prices; the fiscal reforms were aimed at keeping a bad situation from getting even worse.
The idea that Chicago should scuttle the Milton Friedman Institute because it makes other professors unpopular with economic illiterates is shameful, and moreover, something that I presume few of these "scholars" would tolerate if the ignorant were targeting their own fields. That this should be coming out of a university with Chicago's reputation for intellectual rigor is mortifying.
"we've been experimenting with various other systems--both localism and extreme centralization--for over a century"
Can you please direct me to a school or the curriculum of an econ dept that is really interested in this sort of analysis? Chicago can keep the MFI, but I'd really love to know where these "alternatives to market capitalism" are being studied....thoughts?
The Soviet Union, for one. Tanzania and Cambodia's attempts at forced agrarian dispersion. Various communal movements all over the world. All ended in failure. Even Israel's Kibbutzim, the most successful of these experiments, have largely abandoned communalism for variable wages and so forth.
Qui tacet, consentire videtur.
HAHA! Scholars is in quotes!
Megan, you neglected the link to Chocrane's open letter. Here it is:
http://faculty.chicagogsb.edu/john.cochrane/research/Papers/friedman_letter_comments.htm
I think it's a great rant.
"The Soviet Union, for one. Tanzania and Cambodia's attempts at forced agrarian dispersion. Various communal movements all over the world. All ended in failure. Even Israel's Kibbutzim, the most successful of these experiments, have largely abandoned communalism for variable wages and so forth."
And this is where you really sound like a wacko. The options aren't, unbridled laissez-faire or...Soviet Communism. Really, if you have to go to Pol Pot as your first alternative to market capitalism, you're revealing your weak hand.
If you're against market capitalism, you're not in favor of Sweden; you're in favor of Soviet Russia.
What other people said about genocide being the only alternative to capitalism. Also, you're ignoring the meat of the problem. The U. of Chicago has limited resources - all universities do, but many of UC's departments manage to punch above their weight class nonetheless, which make the money problems more of a political issue. Economics is already flush, and now the University is investing a further $200 million in a slush fund for the economics department. I would be pissed too.
"The meat of the problem" - touche!
But I agree: more of this kind of criticism. There's nothing liberal or progressive about most modern leftists. All those vistas still end in a gallows.
Under the so-called neo-liberal order, the prosperity of the poor in the third world has increased in the last 20 years by more than it has in the rest of history. Countries that have adopted (and stuck to) liberal economic policies have shown most of this increase these include ex-communist countries like China, those in Eastern Europe and Vietnam, and countries that had highly regulated and protected markets like India. Countries that have failed to grow usually were corrupt/authoritarian or did not have the political/social capital to restructure their economies (like Bolivia).
If you had a choice would you rather live in Cuba or Chile? How many honestly believe that Venezuela will actually be successful.
rick, i notice you haven't provided any counter examples of your own. can *you* name any successful societies that aren't substantially capitalistic in nature? any examples from history? if not, then the absence of such counter examples is a telling thing in itself. i eagerly await examples of *your* "scholarship".
I have a challenge for all professors who espouse socialism: let's see you try to apply your principles within academia. They don't want to do it, of course, because it would cut into their own privileged lives too much.
For example, there is a huge unemployment problem in academia, compounded by the problem of exploitation of adjuncts. The socialist way of dealing with this situation would be something like job sharing, but those who are tenured are certainly not about to espouse something like that.
Likewise, suppose we throw all grant money into a large pot and distribute it equally to all professors, even to the lowliest of adjuncts at a community college, or even to the unemployed. Once again, those who are tenured would like this about as much as they'd like slitting their throats.
Their actual message is "socialism for thee, but not for me."
rick, i notice you haven't provided any counter examples of your own. can *you* name any successful societies that aren't substantially capitalistic in nature? any examples from history? if not, then the absence of such counter examples is a telling thing in itself. i eagerly await examples of *your* "scholarship".
JFP-
"For example, there is a huge unemployment problem in academia, compounded by the problem of exploitation of adjuncts."
And what created that?
Well, I had tons of marxist profs in History, Poli Sci, English, French Lit and Law, but I suspect that if they had been able to do math, they would not have been such ardent marxists.
This is nothing more than the lefties trying to stamp out any ideological dissent within their hallowed halls of academia - remember kids, diversity means everyone different (and screws different) but thinks in lockstep. I know this because of my extensive diveristy training!
Also, a lot of South American countries never had much real market capitalism - they had more crony capitalism (at best) or just corparatism.
Tenure.
Holdfast wrote "Well, I had tons of marxist profs in History, Poli Sci, English, French Lit and Law, but I suspect that if they had been able to do math, they would not have been such ardent marxists."
My jaw drops when I read stuff like this. Having spent my entire adult life in academia, I've encounter exactly one person who could be described as a Marxist (neo-Marxist, to be precise.) This leaves me to conclude that everyone who avers that academia is littered with Marxists has either a) attended Marxist-only universities or b) doesn't understand the meaning of the term and simply uses it as a pejorative.
Tenure.
Tenure: something completely sustained by the free market.
Tenure.
FOr those irritated by this 'Global South' euphemism, you will love this 'politically incorrect' article titled The Culture of Success.
Sorry about the multiple posts. Apparently refreshing the posting screen resent the post.
My apologies.
Remarked berger (2:10 PM), "I'd really love to know where these 'alternatives to market capitalism' are being studied."
One such place is The Hoover Institution on War, Revolution and Peace located on the campus of Stanford University.
rick apparently exists to troll this blog site. I suggest Ms. McArdle ban him for insulting her.
HEre it is:
And this is where you really sound like a wacko. The options aren't, unbridled laissez-faire or...Soviet Communism. Really, if you have to go to Pol Pot as your first alternative to market capitalism, you're revealing your weak hand.
Posted by rick | July 31, 2008 2:36 PM
Sorry about the multiple posts. Apparently refreshing the posting screen resent the post.
My apologies.
"Sorry about the multiple posts. Apparently refreshing the posting screen resent the post.
My apologies."
You broke the internet.
rick, I guess I owe Al Gore an apology!
No idea what's going on. Nothing shows up, and then a whole bunch of copies.
If this one does it too, I'm done.
Rick wrote: Having spent my entire adult life in academia, I've encounter exactly one person who could be described as a Marxist (neo-Marxist, to be precise.)
Often, they just call themselves Marxian, rather than Marxist, since Marxist sounds just a little too radical when the rubes come to visit on parent's weekend.
That said, your remark strains credulity. Where is this Marxist-free academic environment that you inhabit? The local vo-tech college?
rick, I guess I owe Al Gore an apology!
No idea what's going on. Nothing shows up, and then a whole bunch of copies.
If this one does it too, I'm done.
Michaelyi suggests the Hoover Institute as a place to study alternatives to market capitalism. I'm wondering if a more specific link is available, as the "Mission" page at Hoover states:
"The principles of individual, economic, and political freedom; private enterprise; and representative government were fundamental to the vision of the Institution's founder. By collecting knowledge, generating ideas, and disseminating both, the Institution seeks to secure and safeguard peace, improve the human condition, and limit government intrusion into the lives of individuals."
If there are groups at Hoover actively studying alternatives to market capitalism, they must surely be doing so as a comparative to the freedom, private enterprise, and limited government intrusion cited in the mission statement. I'd be very interested in links to some of these comparative studies.
I'd also be interested in examples of successful non-capitalist societies, and second (or third, as the case may be) CJM's request for such.
Since the collapse of communism in eastern Europe it has always seemed to me that neoliberals are the ones who can now be characterized as the unworldly ideologues. Why can't they admit the failures of their program as well as its successes? Massive income disparities; the creation of a permanent underclass; the privitization of formerly public services and goods; environmental degradation; an unholy (if contingent) alliance with neo-conservative morality and state power. All these things are unsupportable and fortunately many of the younger generation see this. They have seen the effects of 30 years of neoliberalism and are not prisoners of ideology. We need capitalism, but we also need a more worldly, less ideological approach to economic and political life. It's the refusal to candidly admit failure in important respects and the tendency to shut down debate about alternatives (Sweden and Denmark actually *do* have something to offer, as well as their own problems) that is unfortunate.
To the extent that Sweden, Denmark, Finland, etc. have prosperous societies despite high taxes, one should point out to leftists that :
1) These are countries with centuries of PROTESTANT values and cultural norms. That lays the groundwork for civilized behavior, in which a high-tax system can work.
2) These countries don't have a lot of non-protestant people. When Arabs and Africans start becoming more numerous in Sweden and Denmark, things will change fast.
You will send a leftist into writhing agony by pointing this out.
Shorter Tood: White Power!
rick, typical identity politics retort. To talk about the relevance of culture is not racism, it is engaging the empirical facts. Culture and homogeneity are key ingredients to the success of these countries.
rick, typical identity politics retort. To talk about the relevance of culture is not racism, it is engaging the empirical facts. Culture and homogeneity are key ingredients to the success of these countries.
I am actually not white. I am Asian.
Notice how Asians don't enter into discussions about race. Some people don't want it to be known that some non-whites actually earn high incomes, disproving the belief that white Americans are racist.
rick, typical identity politics retort. To talk about the relevance of culture is not racism, it is engaging the empirical facts. Culture and homogeneity are key ingredients to the success of these countries.
Well, for one, what you consider "failures" may not be viewed as failures by the people you're criticizing.
Heck, the entire reason for the post we're discussing is the failure of a significant part of Left-wing academia to realize that their program has failed despite the almost complete collapse of communism worldwide.
So? Why is this a failure?This would be a failure if it were true. In Western nations, by and large, there is significant social mobility for anyone who puts in the hours and dedication. The vast majority of the people in the rich lists of today (especially in America) are self-made.
If they deliver services more cheaply and effectively, I would have no complaints.
In case you haven't noticed, the wealthier the nation, the cleaner it is environmentally. The fastest way to wealth for a nation just happens to be more in the neo-liberal direction.
This I don't get. For someone who is essentially lamenting the fact that governments are no longer in charge of quite so much, no more in control of how much goes into one's pockets, etc. why are you now so upset about state power?
rick - my apologies - some of them may have been Trostkyites and Maoists.
Though I did go to school in Canada.
greg, you list the following as failures of "neoliberals": "Massive income disparities; the creation of a permanent underclass; the privitization [sic] of formerly public services and goods; environmental degradation; an unholy (if contingent) alliance with neo-conservative morality and state power".
Massive income disparities - This situation pre-existed market capitalism and in any event is not a failure per se. No-income subsistence farming means everyone is equally poor.
The creation of a permanent underclass - Creation? I think you need to go look at a history book. Or do you mean that basically everyone was the 'underclass' before market capitalism?
the privatization of formerly public services and goods - How is this a failure? You are just making an assertion. Some specific instances of privatization may be negative, but many others are positive. Privatization certainly is not a failure per se.
environmental degration - Again, read history. Humans have been degrading the environment from day one. What we have actually seen is that as societies become more prosperous, they are able to devote more concern and resources to the environment. Compare USSR vs USA.
unholy alliance blah blah blah - This isn't even a coherent point.
---
rick, your counterexamples, yes? And, btw
http://www.independent.org/publications/tir/article.asp?a=375.
Rick ... you have a hate Megan site? My goodness ... You need to get out more. Play some sport ... take up music ... have a brewski.
You talk like you never left college. Do you have kids, a girlfriend ... they like this talk?
I'm not a professor like you all and really didn't study this stuff but I have been fascinated by this topic.
My guess is people around the world are living in poverty mostly because their governments steal from them.
Companies create jobs ... governments just rules. Ughhhhh.
Since I work for a big global corporation I don't mind them so much. They gave me a job.
As for "economic justice" ... unless folks are offering, don't take other people's money ... especially if its a government giving you their money. Now that's justice.
berger - Can you please direct me to a school or the curriculum of an econ dept that is really interested in this sort of analysis? Chicago can keep the MFI, but I'd really love to know where these "alternatives to market capitalism" are being studied....thoughts?
I'm with you, buddy. And while we're at it, how about some schools that do research into alternatives to Newtonian Mechanics? How about alternatives to organic chemsitry? Those covalent bonds are just shackles on the proletariat put there by The Man. How about alternatives to aerodynamics? I think the airplanes I fly in have all been held up in the air by the kindness of Gaia. Or faeries. Or both.
You're on to something, berger. I think you ought to open your own school. No, really, you should. Hock everything you own and go for it!
Martin Knight and b2,
You absolutely murdered rick. I doubt he'll be back to respond...
I wrote a letter to the University of Chicago magazine about this.
In their most recent issue they noted the open letter. In the same issue they had an article on the most efficient way to distribute water resources. And what is the most efficient way to handle water rights? An open market where the owners of water rights participate voluntarily in a market for water.
I noted the irony.
They may publish my letter in the next issue.
Jim:
Why do you assume Rick is a professor just because he says he's "spent his entire adult life in academia." I just assumed he was having trouble graduating. After all, if he doesn't know a Marxist when he sees one ....
The Benedictines have been running a truly benevolent non-capitialist society for 1500 years. I really want economic analysis of what they have done.
Yours,
Wince
Well my biggest problem is that we in Western World are not Neo-liberal enough, we have been going more and more Statist, with 40-50% of wealth going to Government and too much regulation, and we are loosing competitivity to former Socialist countries that are increasing Neo-liberal, unfortunatly some only neoliberal in economy not in politics.
My jaw drops when I read stuff like this. Having spent my entire adult life in academia
Let's skip over your misuse of the word "adult" and get to the real question here: How many credits are you still lacking? Do you need a tutor? Revocation of access to the Delta House liquor cabinet? Whatever it is, just let me know -- I'm here to help!
I agree. Rick is one of those 48-year-old PhD students who has been stuck there for decades, unable to complete his dissertation.
He will soon go on a shooting spree. They all do.
PhD = Passed Higher-ed with Difficulty
Er, sigh. Chuckle.
That this should be coming out of a university with Chicago's reputation for intellectual rigor is mortifying.
No. It is just sufficient reason for us to reconsider that reputation. Chicago has gone considerably downhill and this is only the latest evidence.
Why can't they admit the failures of their program as well as its successes?
Perfect equality looks like this. It is no failure that it is gone. Belonging to another generation (and another continent) you have no idea how poor and rotten those communist countries were.
You're also completely wrong when commenting on environmental policies. Heavy industry in the east block was notoriously dirty (I guess you can still get the idea by travelling to China). The end of communism was the best thing that could happen to nature. A lot of effort and money has been spent on cleaning up the mess.
Perhaps, if we had an entirely different economic system, we could find the means to send the doltish UC professors off to the countryside for some re-education.
That this should be coming out of a university with Chicago's reputation for intellectual rigor is mortifying.
No. It is just sufficient reason for us to reconsider that reputation. Chicago has gone considerably downhill and this is only the latest evidence.
Occam-
If this one does it too, I'm done.
(Psst!) Use the Razor- maybe the "server squirrels" won't recognize you! :o)
When I think of all the nonsense I could prevent from coming into the world by traveling back in time and shooting Jean Rousseau and Karl Marx before they first published, I get so wistful...
Unfortunately, American academic culture was very thoroughly infected with Marxism, if not actual kissing-Stalin's-arse Communism, during the 1930s. A lot of the people in power on campuses during the 1960s' upheavals had either been in grad school, or starting their academic careers, during the 1930s, and academia was one place that they could keep their "idealism" intact, thanks largely to the never-to-be-sufficiently-reviled tenure system. The crypto-Reds set the tone, and so it has stayed...our lovely and talented hostess commented on her earlier blog (as "Jane Galt") that many academics find conservative or free-market positions distasteful, and some think they're evil, so conservatives and free-market types tend to either avoid academia, or keep their heads very, very low.
Solutions? Gee, my crystal ball just went fuzzy...
Rick,
From 1967 to 1986 I went to four universities in the eastern US, and dealt with faculty at three others. The only department I found to be totally free of Marxism were Russian (Language.) The humanities became increasingly marxist over time.
I would consider countries like Sweden to be essentially a capitalist country. Large safety net, high taxes, etc, are things they added onto the capitalism because they liked them. Its funny, but as countries grow richer, they have the option to do that. Its not the other way around in Sweden, where the socialism allowed the private sector.
Churchill's quote:
Some see private enterprise as a predatory target to be shot, others as a cow to be milked, but few are those who see it as a sturdy horse pulling the wagon.
Seems very apt.
Hehe, there's nothing quite so funny as anti-intellectuals who, in spite of themselves, can't help wishing that they were smart enough to understand the world, too. I raise my glass to the lot of you! May your copy of Reader's Digest ever be dog-eared.
As an aside, thinking that Marx was a ground-breaking figure in the social sciences (on the level of, say, Smith, Mill, Durkheim, Weber) does not make one a Marxist. Indeed, it doesn't even entail left-wing politics. Many people have trouble accepting this.
The "social sciences" aren't.
Marxism is primarily a theory of economics. One that has utterly failed in every instance of it's attempted application. Heck, Marx even said that his theories would be first adopted in the most advanced capitalist societies. When in fact it was the least advanced that adopted them. And went even further backwards as a result.
Far from being a "ground-breaking figure" Marx was a society destroying philosopher. How there can still be any argument over this eludes me.
Consider the places that still try to apply his ideas, North Korea, Cuba, Venezuela, Zimbabwe...all basket cases. Consider the places that did the opposite, Chile, South Korea, Japan.. all bringing great improvement to the lives of the ordinary working people that Marxism was supposed to benefit.
It turns out that the theory of retrograde motion is more useful for astronomy than Marxism is for economics. A good short hand theory of economics could be summarized as follows: Find out what Marx suggests, and to the opposite. :
As for the failure of neo-liberalism in Eastern Europe and Russia, give me a break. Neo-liberalism was never tried there. The ruling elites simply exchanged the rhetoric of communism for the rhetoric of capitalism as the justification for their robbing the country blind.
The idea that Putin is applying neo-liberalism, as he apportions the nations wealth among his ex-KGB buddies, and puts his true capitalist opponents in jail...or murders them....is just idiotic. The same goes for Belarus, and the other "ex-Soviet Republics". {sic}
Oh, and no Marxist professors in the Universities? In his autobiography, Obama states that he actively "sought out Marxist professors". So is Obama "red-baiting" then?
Am I to understand that the political philosophy (socialism) that brought us genocide, concentration camps, bombed out cities, slavery and war is somehow superior to the only political/economic philosophy (capitalism) that brought us prosperity, happiness and the necessary resources to defeat the other philosophy? Just how does that argument go?
Who's familiar with the tactics of intelligent design proponents? They're a bunch of creationists who, realising that creationism has been totally discredited as religious bullshit, have taken to pretending to present a vague 'alternative' to evolution that hides it's religious motivation. Then they try to claim equal time in science classes, because they're not peddling creationist bullshit, they're airing 'alternate views', and who doesn't want alternate views to be heard?
So passages like this in that open letter greatly amuse me:
"Still others believe that, given the influx of private contributions to the MFI, the University now has the opportunity to provide roughly equivalent resources for critical scholarly work that seeks out alternatives to recent economic, social, and political developments."
Let me guess, they're not marxists, they're intelligent central plannerists, and they've come to seek out 'alternatives'.
As comforting as it would be for people like Rick to believe Megan is simply engaging in hyperbole, what she has posted is quite literally true. Today, there are no serious economics departments teaching the theory of surplus value. None. And although some would like to argue semantics about what a "marxist" is, economic socialism is entirely predicated on the labor theory of value implied by Marx's theory of surplus value. All of the left's ideas on "social justice" are based on a worldview based on a theory of economic causation based on Marx'x surplus value, whether today's socialists know it or not. Yesterday's socialists certainly did.
And the only place you are going to find these leftist theories still being taught in today's university is in Liberal Arts departments. Poli-sci, journalism, women's studies, english lit. But you won't find it in actual economics departments, and you haven't been able to for some time now. In the world of economic science, capitalism IS economics. It's time for the left to get over it already, and revisit their core premises.
yours/
peter.
I think it's pretty obvoius that when academics refer to the "global south", they mean the people in flyover country who they really really wish were disfranchised. I think your basic question is good. There are some obvious deficiencies of laissez faire capitalism, the most obvious of which is that it permits parasitism. It seems to me that laissez faire without parasitism would be a step forward. There are, as it happens, a few haphazard laws against parasitism, but since the principal parasites are to be found in the halls of Congress, it's silly to suppose that the Congress is going to straighten this out.
There is, as it happens, a vehicle for the elimination of parasitism, and that is the initiative and referendum which many states support. The members of Congress are inherently weak and frightened, and if the people start acting like a real political force, then it is possible that there will be an end to parasitism.
I will personally support any and all efforts to do this, which is to say that I will support all initiatives and referenda which arise from the people, not from some special interest group. That includes, for me, the Massachusetts referendum to abolish the state income tax. In other states, where I don't have a vote, it may include all of Ward Connerly's initiatives. I can't begin to think of a reason why we should not support these, unless we are among the privileged parasites who benefit from the present structure. I'm tired of being polite to these thieves, so we should call a spade a spade.
Wince and Nod - You claimed that the Benedictines are unstudied as to their alternative economics. Next time try Google. here you go and it took me about a minute to find. No doubt I'd find more if I looked harder.
Voluntary socialism can work, in many limited ways -- that's what insurance is.
It's probably true that there aren't "Marxists" or even many "Socialists" in academia, there are just power-hungry elite using populist Marxist rhetoric as an excuse to increase gov't power. Which they think will result in more influence by the elite.
Destructive envy against the rich has a longer history of popularity than Marxism, after all.
Why don't more folk who want more socialism buy more insurance for more reasons? Most want gov't to act like an insurance agency to cover any little catastrophe, and especially want the rich to pay the premiums. Most want the gov't to use Other People's Money for their own benefit, or for the benefit of those "victims" deemed worthy.
Gov't, involuntary socialism always fails because it sets up a system of taking from some to give to the gov't selected recipients -- and some rich and powerful always co-opt such systems to recieve the benefits or direct the benefits to their friends/ supporters/ campaign contributors/ house builders (not just T. Stevens).
Socialism for electronic information would probably provide the world net benefits, today, because I don't think the high cost of enforcement balances the increased innovation. End copyright enforcement.
Mugabe's Marxist policies in ex-Rhodesia, the ex-bread basket of Southern Africa, show how rich-envy based policy still fails in farming.
Dear KT Cat,
I think that if you actually read my post you'll notice that I wasn't saying that there need to be econ depts where you could study alternatives to capitalism - I was taking issue with the suggestion that there *were/are such depts. Megan's reference to the "Soviet Union" falls a bit short in this regard.
Anyone else notice a deafening silence from rick since his original posts?
Hi,
"Why aren't there hordes of economists studying meaningful alternatives to market capitalism? Because we've been experimenting with various other systems--both localism and extreme centralization--for over a century, and the experiment produces the same damn result every single time: human lives that are nasty, brutish, and short."
I recommend Against the Dead Hand: The Uncertain Struggle for Global Capitalism for a solid discussion of the topic.
I love reading these diatribes about Marx by people who obviously haven't read much Marx.
Robert H says:
"A good short hand theory of economics could be summarized as follows: Find out what Marx suggests, and to the opposite."
Actually, if you peruse the Communist Manifesto, you'll see most of his prescriptions have been implemented right here in the good ole USA, to everyone's benefit!
Next thing you know Robert H is going to tell us how Marx's analysis of value has nothing in common with Smith and Ricardo.
Similarly, the author of the post that Megan quotes obviously doesn't know what he is talking about. He cites South Korea as an example of neo-liberalism working? Anyone with even a passing familiarity of the economies of developing countries knows the South Korea never implemented such policies, and in fact achieved its growth and development through doing the opposite of neo-liberal prescriptions: state-led planning and protective tarriffs.
"As an aside, thinking that Marx was a ground-breaking figure in the social sciences does not make one a Marxist."
I'm not sure what your point is here. Do you mean this in the sense that "Acknowledging Stalin was the leader of a superpower does not make one a Stalinist" or an admirer of Stalin?
Or do you mean that most professors, though slavishly towing the crypto-Marxist/post-modernist sludge to the trough of their students, would not be considered "pure" enough in their Marxism or leftwing politics to survive the firing squads once the True Believers take over?
Because, yes, both are probably true. But even those who would themselves be shot come the Revolution (just about all of intellectuals, actually) still aide and abet psuedo-communist nonsense in academia -- and try their best to squash all dissent from it. As this letter whining about neo-liberalism shows. Notice, they weren't complaining that anyone was censoring them, they were in fact trying to censor others.
Dear MP - Marxism is a political program entailing, at the very least, strong and coherent beliefs about the inefficiency or injustice of private ownership of capital goods. Marx, on the other hand, was a classical economist with lots of novel ideas about how classical economics could be modified to better understand both modern and pre-modern societies.
Using Marx's ideas as a springboard never involves Marxist politics. It has nothing to do with "getting shot when the revolution comes." You need some coffee.
"As an aside, thinking that Marx was a ground-breaking figure in the social sciences does not make one a Marxist."
I'm not sure what your point is here. Do you mean this in the sense that "Acknowledging Stalin was the leader of a superpower does not make one a Stalinist" or an admirer of Stalin?
Or do you mean that most professors, though slavishly towing the crypto-Marxist/post-modernist sludge to the trough of their students, would not be considered "pure" enough in their Marxism or leftwing politics to survive the firing squads once the True Believers take over?
Because, yes, both are probably true. But even those who would themselves be shot come the Revolution (just about all of intellectuals, actually) still aide and abet psuedo-communist nonsense in academia -- and try their best to squash all dissent from it. As this letter whining about neo-liberalism shows. Notice, they weren't complaining that anyone was censoring them, they were in fact trying to censor others.
"Using Marx's ideas as a springboard never involves Marxist politics. It has nothing to do with "getting shot when the revolution comes." You need some coffee."
Surely it's an exaggeration to say using Marx's ideas NEVER involves Marxist politics. I will gladly grant, however, that it doesn't ALWAYS have to involve Marxist politics.
But it definitely has to do with getting shot. Historically, it was exactly those well-meaning intellectuals who used Marxist ideas "as a springboard" but yet remained too politically naive to cloak themselves fully in the Party who were the first to be killed when the Party took power. And unlike those who were rabidly anti-communist from the start, they were generally shocked and confused to be so targeted.
Marxism is primarily a theory of economics. One that has utterly failed in every instance of it's attempted application. Heck, Marx even said that his theories would be first adopted in the most advanced capitalist societies. When in fact it was the least advanced that adopted them. And went even further backwards as a result.
Far from being a "ground-breaking figure" Marx was a society destroying philosopher. How there can still be any argument over this eludes me.
Consider the places that still try to apply his ideas, North Korea, Cuba, Venezuela, Zimbabwe...all basket cases. Consider the places that did the opposite, Chile, South Korea, Japan.. all bringing great improvement to the lives of the ordinary working people that Marxism was supposed to benefit.
It turns out that the theory of retrograde motion is more useful for astronomy than Marxism is for economics. A good short hand theory of economics could be summarized as follows: Find out what Marx suggests, and to the opposite. :
As for the failure of neo-liberalism in Eastern Europe and Russia, give me a break. Neo-liberalism was never tried there. The ruling elites simply exchanged the rhetoric of communism for the rhetoric of capitalism as the justification for their robbing the country blind.
The idea that Putin is applying neo-liberalism, as he apportions the nations wealth among his ex-KGB buddies, and puts his true capitalist opponents in jail...or murders them....is just idiotic. The same goes for Belarus, and the other "ex-Soviet Republics". {sic}
Oh, and no Marxist professors in the Universities? In his autobiography, Obama states that he actively "sought out Marxist professors". So is Obama "red-baiting" then?
I enjoyed this a lot, but I wish there were a link to the original. I also wish the author had a copy editor. He's great a deconstructing hogwash, but I wish his substance were as polished as their baloney.
One mystery solved: if you refresh the page to check for subsequent comments, it reposts your original post. Aargh....
And unlike some other comments sections, I see no mechanism here for removing your own unwanted repost.
"Actually, if you peruse the Communist Manifesto, you'll see most of his prescriptions have been implemented right here in the good ole USA, to everyone's benefit!"
I'll grant you the "implementation", although for some, certainly not "most". Its the "to everyones benefit" part that is glaringly incorrect.
Even Bill Clinton finally had to admit that our "welfare" system was destroying the families of the poor, and creating a permanent underclass with no hope of escape. Merely cutting back on it has improved the lives of millions.
And is there anyone today who still believes that LBJ's Great Society Program was anything more than a bureaucratic boondoggle, wasting Billions while helping no one. It is due to the Marxian, postmodernist theology that Detroit today graduates less than half of it's minority high school students.
I will grant you this, you are honest enough to admit that Marxism has, and still is, having a major impact on US governmental policy. The names, of course, having been changed to disguise the source. Income redistribution having been renamed "social justice", to "allieviate income disparities".... One needs fancy names to distract from the sad fact that overtaxing the "rich" slows down the economy, resulting in lower total tax collections, thus harming rich and poor alike.
Marxism is the first Religion where most of the followers refuse to honor the founder, or even admit to being his followers. While retaining the religion as a whole, despite the empirical disproof of it's dogma. You, in contrast, are honest enough to admit who you are following, and I laud you for that honesty.
"Am I to understand that the political philosophy (socialism) that brought us genocide, concentration camps, bombed out cities, slavery and war is somehow superior to the only political/economic philosophy (capitalism) that brought us prosperity, happiness and the necessary resources to defeat the other philosophy? Just how does that argument go?"
Just for the record, genocide, war, concentration camps, and slavery predate socialism.
"Just for the record, genocide, war, concentration camps, and slavery predate socialism."
True; it does rather seem that the two main "alternative economic systems" to capitalism are hunter-gatherer societies and slave/feudal societies. Communism was not a step forward away from class differences, but a step back into taking people's labor at the point of a gun rather than at the end of a cash register.
"Just for the record, genocide, war, concentration camps, and slavery predate socialism."
True; it does rather seem that the two main "alternative economic systems" to capitalism are hunter-gatherer societies and slave/feudal societies. Communism was not a step forward away from class differences, but a step back into taking people's labor at the point of a gun rather than at the end of a cash register.
Megan,
What about Singapore?
-M
Michael -
What about Singapore? It was thrown out of Malaysia because Lee Kwan Yew and other leaders wanted a meritocracy, rather than a welfare state for bumiputras. It's quite a nanny state on social issues like chewing gum and flushing toilets, and the many professors that I know there are well aware that a negative remark about the government could get them permanently cut off from government grants. Still, it's basically a free market/meritocracy, far from perfect and with probably too much government 'guidance' of some industries.
Overall, you make a good point, that the patterns throughout Asia and particularly the success of Singapore, Hong Kong and Taiwan reinforce Megan's points.
Mutant Pacifist -
Very well said!
Benedictines?
Everyone seems to be forgetting that the Jesuits set up an economically successful Christian communist state for the Guarani Indians of Paraguay in the 17th century. Probably the only case of a benign communist government in world history.
http://en.wikipedia.org/wiki/Jesuit_Reductions
http://www.kirkhouse.com/catalog/-p-174.html
Actually, I would argue that many subsistence-level societies have managed with the equivalent of communism. For instance, many native American tribes didn't have what we would consider private property, in that anyone in the tribe could use anyone else's possessions if they felt that they really needed it. If taking someone else's spear helps you to kill an animal that will feed the whole tribe, it may be worth it. The stories of old people dying voluntarily so that they wouldn't burden the tribe make sense if literally the entire tribe might not survive otherwise.
In a primitive economy where cooperation is the only way to survive, many of the incentive problems of communism are overcome. Also, there are fewer logistical challenges to managing an economy without markets, if the economy is very basic and limited to a small number of closely-related people. Of course, the same system that may allow the tribe to survive also limits development, so they stay at subsistence level.
Why do you assume Rick is a professor just because he says he's "spent his entire adult life in academia." I just assumed he was having trouble graduating. After all, if he doesn't know a Marxist when he sees one ....
Based on his blogging, I'm pretty sure that his "entire adult life" is about 3 months.
If you're against market capitalism, you're not in favor of Sweden; you're in favor of Soviet Russia.
Bull. The whole debate in the west is about the level of state intervention in the economy. Everybody agrees it should be a lot more than zero (libertarian utopia) and a lot less than 100 (Soviet Russia). The Swedish government spends over half of GDP, so that's a pretty darn large social sector. Trying to tar your opponents by saying that they favor a 100% state-run economy is just a way of distracting from the fact that no advanced country has anything close to zero.
Why aren't there hordes of economists studying meaningful alternatives to market capitalism? Because we've been experimenting with various other systems--both localism and extreme centralization--for over a century, and the experiment produces the same damn result every single time: human lives that are nasty, brutish, and short.
On the contrary, we have evolved in every case toward mixed economies with a large government sector. And the great majority of all applied economists study the effects of government intervention in the economy. Every one of those interventions is a "meaningful alternative" to the market in the area where it is applied.
Also, on neoliberalism, successful development strategies have been far from totally laissez-faire. They've had a substantial government role. Mixed economy again.
MQ has it exactly right. If few are arguing for the total abolition of private property, then few (including Smith) are also proposing unbridled markets ala Nozick. The interesting, and more important, debates are all about degrees of intervention. Solow puts it pretty well:
"Many discussions of economic policy…boil down to a tension between market allocation and public intervention. Marketeers keep thinking about the doughnut of allocative efficiency…and dirigistes are impressed with the size of the hole containing externalities, imperfections and distributional issues." Solow, 1974.
Tired and repetitive name calling of the "leftists" variety are better left to Hannity and his ilk over on Fox.