Posts Tagged ‘markets’
Tags: blockade, cartoon, Detroit, gasoline, Gaza, infrastructure, internet, invisible hand, Israel, markets, minimum wage, outsourcing, profits, roads, Seattle, United States, water
Tags: conference, Friedrich Hayek, Karl Polanyi, markets, utopia
Adam Morton and some of his new colleagues at the University of Sydney are organizing a workshop, Questioning the Utopian Springs of Market Economy, in August of this year.
The initiative for the workshop stems from the seventieth anniversary, falling in 2014, of the publication of two seminal political economy texts written respectively by Karl Polanyi and Friedrich Hayek. In 1944 both Karl Polanyi’s The Great Transformation and Friedrich Hayek’s The Road to Serfdom were published, delineating very different pathways to the utopian springs constituting and challenging market economy. These pathways focused on the ‘birth of the liberal creed’ (Polanyi) and the road to ‘security and freedom’ (Hayek) in mid-twentieth century conditions that still shape the present.
Here is a direct link to the web site for what promises to be an engaging and intellectually important workshop.
Tags: Chrystia Freeland, commodity fetishism, economics, labor power, markets, Marx, Michael Sandel, teaching
Here’s an interesting discussion of markets and market society, with Michael Sandel (Professor of Government, Harvard University) and Chrystia Freeland (journalist and Member of the Parliament of Canada), which might be useful for those of us who teach in and around economics.
One way to think about the video is that Sandel and Freeland take up and expand on many of the themes one finds in the first three chapters of volume 1 of Capital. The drawback, at least for some of us, is that they overlook the rest of the critique of political economy— especially the conditions and consequences of the commodification of labor power.
Tags: cap-and-trade, Democrats, economics, economists, environment, healthcare, markets, neoclassical, Obamacare, Republicans
It used to be Harvard-based neoclassical economists could count on their Republican friends and allies to support their free-market policies. Now, apparently, not so much.
That’s the only explanation for why Jeffrey Frankel has to step forward and attempt to remind Republicans that market mechanisms—such as cap-and-trade and Obamacare—were their idea.
In the US, cap-and-trade was originally considered a Republican idea. Market-friendly regulation was pushed by those who thought of themselves as pro-market, rather than by those who thought of themselves as pro-regulation. . .
Republican politicians have now forgotten that this approach was ever their policy. To defeat the last major climate bill in 2009, they worked themselves into a frenzy of anti-regulation rhetoric. . .
One can draw a fascinating parallel between the evolution of American political attitudes toward market mechanisms in the area of environmental regulation and Republican hostility to the Affordable Care Act, also known as Obamacare. Obamacare is a market mechanism in the sense that health insurers and care providers remain private and compete against each other.
Frankel is, in fact, right. Both cap-and-trade and Obamacare came straight out of Republican think tanks, precisely in the way neoclassical economists had designed them. Then, they were the best of friends. Now, apparently, Republicans have to be reminded of that friendship.
Or scared into remembering that close relationship. Because, Frankel warns, the alternative is more government regulation.
It really is a sign of how much political and economic discourse has changed in the United States that it’s Democrats who are implementing market-based, originally Republican-designed policies. And that, even more: from the perspective of someone like Frankel, any government regulation of business (not, mind you, government ownership) can blithely be referred to as “command and control.”
Tags: economics, history, history of economic thought, markets, neoliberalism, Philip Mirowski
Philip Mirowski’s latest, Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown, has been getting quite a bit of play since publication. Antipode has published a review symposium and Mirowski himself has participated in an exchange at the FDL Book Salon and been interviewed by the New Books Network, Estudios de la Economía, and by Nathan Tankus for Naked Capitalism.
Here’s an excerpt from the interview conducted by Tankus:
NT: Given this context, what are the salient features of Neoliberalism that have generally been preserved over time? What are the origins of the Neoliberal Thought Collective and how has it changed?
PM:The origins were surprisingly transnational, given the mistaken widespread impression that Neoliberalism is predominantly an American fascination. It began with some tentative meetings of the Colloque Walter Lippmann in Paris in the 1930s, and became consolidated with the Mont Pèlerin Society in the 1940s. I try and demonstrate in the book that it has grown ever more cosmopolitan over time, although my own deficiencies in foreign languages and non-Western history thwarts my realization of that ambition. Throughout the decades, the thought collective has maintained a productive tension between its American-flavored Chicago wing and its continental Austrian/Ordo tendency.
Although some on the left have suggested that the thought collective displays no substantial continuity across time and space, in the book I attempt to summarize some of its more enduring attributes. One telltale complex encompasses some of the things Michel Foucault first drew our attention to, such as the image of ideal human life as becoming the ultimate entrepreneur of your own flexible self, but one where the putative Self as captain of your own fate deliquesces into a moral and intellectual vacuum. This explains why Neoliberals are so contemptuous of Isaiah Berlin’s ‘positive freedom’, since there can be no enduring Self that demands fealty: you need to be an infinitely pliable entity in order to adequately respond to the demands of the marketplace. Various technologies like Facebook serve to teach the masses how to maintain the outward appearances of this empty self.
Because the book is focused on the crisis, I devote far more effort to enumerating and summarizing the Neoliberal approach to political economy. It starts from the premise (contrary to their public PR) that they reject classical liberalism, because they don’t believe in a traditional circumscribed sphere for the state separate from that of The Market. Instead they are constructivists, redefining and building a strong state to institute and maintain the kinds of markets they think will not come about on their own. For the collective, the most propitious time to make such bold interventions is during a crisis, when they are mobilized to define ‘exceptions’ to previous rules. Their prescription for apparent market failures is always more new-fangled markets. Hence, as they have often explicitly written, they are not ‘conservatives’ in any meaningful sense of the term. They often vent their distrust of democratic structures, hoping to reconcile them with their interventions by portraying voting itself as a kind of hobbled marketplace. Democracy therefore needs to be contained and neutralized by a strong state.
For Neoliberals, The Market is the only ultimate arbiter of Truth. Their problem is that most people still resist this fundamental tenet, because they persist in believing in quaint notions of justice, including the notion that rewards should be proportionate to effort, or else hoping sustenance be apportioned according to basic needs. Because The Market is smarter than anyone, the poor need to capitulate to whatever The Market currently bequeaths them. The rich, of course, have no problem with their lot. This unequal distribution of wealth is a necessary structural feature of capitalism. Market discipline should also extend to corporations; the Neoliberals have long proselytized for the extension of market-like incentives within corporate boundaries. Outsourcing and outsized CEO recompense are direct corollaries. Gargantuan firms are not a serious problem, since they merely are a reflection of fleeting market success; antitrust should be jettisoned, and there is no long-term problem of Too Big to Fail.
The Neoliberals have changed over time primarily by sloughing off progressively more of their classical liberal heritage. It began with Chicago rejecting the very idea of corporate power as a problem for capitalism in the 1950s; it continued with rejection of the prior Austrian tendency to distrust the destabilizing potential of the finance sector. (Gold bugs and 100% money cranks no longer get much respect from the Neoliberals.) They have abandoned all classical liberal aspirations to improve the lot of the working classes through education; rather, they now seek to undermine all public education by subjecting every credentialing process to the marketplace of ideas. They dismiss the classical liberal suspicions concerning intellectual property, since inventing new property rights is an effective way to defeat their opponents. Finally, the thought collective has managed to string along their useful fellow-travelers, the true libertarians, without once admitting that they share little more in common than some vain posturing over freedom.
Tags: airlines, cartoon, deficits, global warming, Goldman Sachs, health, healthcare, insurance, markets, Obamacare, Republicans, tax cuts, Tim Geithner, Wall Street
Tags: art, conspicuous consumption, Francis Bacon, inequality, Jeff Koons, Joseph Stiglitz, leisure class, markets, Thorstein Veblen
It just so happens, in class this week we’re finishing up our discussion of Thorstein Veblen’s The Theory of the Leisure Class and beginning Joe Stiglitz’s The Price of Inequality.
Is there a better illustration of conspicuous consumption and the rise of inequality in the New Gilded Age than what transpired at yesterday’s auction of contemporary art at Christie’s New York? Not only the record prices but also the sale room itself:
It did not seem especially hard to sell work last night, only a matter of diverting large amounts of cash. Kelly Crow of The Wall Street Journal called attention on Twitter to a new structure in the sale room for all the “discreet $$ coming in,” a sort of ground-level sky box with “one-way glass [that] looks like a duck blind.”
As for the rest of us, who are not members of the leisure class, the best we were able to do is view the Christopher Wool retrospective at the Guggenheim (which I did a couple of weeks ago) and take some “‘selfies’ and ‘Instagram images’ during the brief period in which [Jeff Koons's] Balloon Dog was installed at Christie’s before the sale” (which I didn’t).
Tags: Boeing, cartoon, corporations, healthcare, insurance, JPMorganChase, markets, Obamacare, Republicans, unions
Tags: Great Depression, markets, SAC, SEC, Second Great Depression
Last night, on the BBC program Business Matters, I argued that the Securities and Exchange Commission’s settlement of the insider-trading case with SAC Capital Advisors was just a slap on the wrist—a fine of $1.8 billion that still allows Steven A. Cohen to keep the bulk of his estimated $8-9 billion wealth.
But it was a necessary slap on the wrist in the sense that it was intended to restore faith in markets, not unlike the law establishing insider trading as a crime when the SEC was created back in 1934. Cleaning up financial markets then, five years into the First Great Depression, was designed to rebuild confidence not only in financial markets but in capitalism more generally.
And it worked—alongside the other programs of the first and second New Deals, and of course the recovery created by World War II.
But, I added, I’m not sure it’s enough now. Yes, the SEC is seeking to levy large fines (on Steven Cohen’s SAC and probably on Jamie Dimon’s JPMorgan Chase). However, the people who have been most affected by the financial meltdown—who lost their homes and jobs, and are struggling to put food on the table and send their kids to college—have every right to say, “Been there, done that. We’ve tried investigations, fines, and regulations before and look at the mess we’re in again, in the midst of the Second Great Depression.”
And so maybe, they’ll be singing along with The Who:
And I’ll get on my knees and pray
We don’t get fooled again
Don’t get fooled again
Tags: capitalists, fairness, John Rawls, justice, markets, morality, Robert Nozick, workers
Amia Srinivasan sets her critical sights on the free-market liberalism of Robert Nozick but, in the end, she undermines both forms of market moralism—of both Nozick and John Rawls.
Perhaps her most telling insight is how narrow the terms of the mainstream debate actually are:
Rawls and Nozick represent the two poles of mainstream Western political discourse: welfare liberalism and laissez-faire liberalism, respectively. (It’s hardly a wide ideological spectrum, but that’s the mainstream for you.)
Snrinivasan’s questions to those who follow a Nozickian version of market liberalism are indeed quite useful. But, lest Rawlsians think they can rest content with current arrangements that represent departures from Nozick’s preferred approach, she makes a series of observations on the actual injustices occasioned by market moralism in the United States:
People might be legally prohibited from selling their organs, but that doesn’t remedy the desperate circumstances that might compel them to do so. The law does not stop people from falling into poverty traps of borrowing and debt, from being exploited by debt settlement companies promising to help them escape those traps, or losing their homes after buying mortgages they can’t afford to pay back. And there is certainly no prohibition against the mind-numbing and often humiliating menial work that poor people do in exchange for paltry wages from hugely rich companies. A swiftly eroding welfare state might offer the thinnest of safety nets to those who fall on hard times, but it does nothing to address the lack of social mobility caused by the dramatic rise in inequality. And while it might be thought poor form to walk by a drowning man, letting children go hungry is considered not only permissible, but as Senator Sessions said, “a moral issue.” These facts might be not quite as ethically outraging as walking past a drowning man, but they, too, grate against our commonsense notions of fairness.
The fact is, neither version of market moralism effectively captures the injustice of current economic arrangements. What we need to do is leave the sphere of markets—which, as that cigar-smoking critic of political economy wrote almost a century and a half ago, represents the very Eden of the innate rights of human beings, where freedom, equality, property, and Bentham rule—and begin to think about the fundamental unfairness of an economy where employers have the right to appropriate the surplus labor of their workers.
Once we do so, we can’t but agree with Snrinivasan about how narrow the mainstream ideological spectrum actually is.