Posts Tagged ‘David Brooks’

wages-productivity

David Brooks should have left well enough alone.

Middle-class wage stagnation is the biggest economic fact driving American politics. Over the past many years, so the common argument goes, capitalism has developed structural flaws. Economic gains are not being shared fairly with the middle class. Wages have become decoupled from productivity. Even when the economy grows, everything goes to the rich.

But then Brooks spends the rest of his column trying to convince us that there aren’t any really structural flaws, that “the market is working more or less as it’s supposed to.”

Well, maybe it’s working “more or less as it’s supposed to” for those at the top. But it’s certainly not working for everyone else, for those who actually have to work for a living.

The relevant debate is all about wages and productivity.

For Brooks (and the mainstream economists whose work he relies on), wages aren’t growing not because something is wrong, but because productivity isn’t growing. Or in his inimitable, sloganeering fashion:

It’s not that a rising tide doesn’t lift all boats; it’s that the tide is not rising fast enough.

Except, of course, productivity has grown—and wages haven’t kept up. Not by a long shot!

As is clear from the chart above, productivity has increased enormously since 1987—whether measured in terms of real GDP per capita (the orange line) or, even more, real nonfarm business output per hour worked (the green line).

So, yes, Americans have become more productive over the course of the past three decades. But wages have lagged far behind.

In fact, as is also clear in the chart, real wages (measured in terms of real weekly earnings, the blue line) have been virtually stagnant. They’ve risen only 5.5 percent over that period, much less than GDP per capita (54.4 percent) and labor productivity in nonfarm businesses (76.1 percent).

In the end, maybe Brooks is right. Maybe the growing gap between wages and productivity is not a structural flaw. Maybe it’s the way the market is supposed to work.

If so, then it’s time the break the system that both generates and relies on the large and growing gap between wages and productivity—the one Brooks and mainstream economists work so hard to convince us isn’t broken at all.

Our job, then, is to get to work imagining and creating a radically different economic and social system.

02-native-american-long-house.w750.h560.2x dsc_0061

Back in May, in an interview with Grèce Hebdo, French philosopher Alain Badiou was asked about the source of his optimism concerning contemporary social movements, from Nuit Debout to Bernie Sanders, even when they face strategic setbacks:

So you’re continuing to look to communism as a horizon?

Yes, not only do I keep this horizon open but I think it is very important to do so. For if there is no strategic idea then movements undergoing setbacks or recuperation risk having devastating subjective effects. There you risk demobilisation, the thought that ‘well I was young then, I threw myself into this adventure and it didn’t work’. Our thinking has to be that while there are strategic setbacks we will maintain our course despite the sinuosities of History. History does not march in a straight line but in a very tortuous way, and we should not imagine any royal road leading to emancipation. There are reverses, negatives, and that is why we need to have a compass come what may. If we have no compass we end up old and disheartened.

I was thinking about the idea of communism as a horizon as I read (only because a reader [ht: ja] sent me the link) the latest from New York Times columnist David Brooks. He begins by noting that, in the eighteenth century, American Indians rejected colonial society (which “was richer and more advanced”) but many whites were moving the other way, choosing to live within Indian society (which was “more communal”).

Brooks then moves up to the present and notes that there seems to be a new desire for community, at least among Millenials.

Maybe we’re on the cusp of some great cracking. Instead of just paying lip service to community while living for autonomy, I get the sense a lot of people are actually about to make the break and immerse themselves in demanding local community movements. It wouldn’t surprise me if the big change in the coming decades were this: an end to the apotheosis of freedom; more people making the modern equivalent of the Native American leap.

While readers wrap their heads around the idea that Brooks might be a modern-day communist (or at least a communist sympathizer), consider what that means. In many Native American societies, the surplus was created by the direct producers and then managed not privately (as in capitalism), but by the commune (either directly or by a representative of the commune, such as an elder or religious figure). So, in historical communism (which some, especially in the Marxian tradition, refer to as “primitive communism”), there was no exploitation, no “ripping-off” of the producers by “autonomous” individuals who did not participate in creating the surplus.*

And, as it turns out, communism is more than just a horizon: it’s actually being practiced in a wide variety of economic and social settings. One such example are the refugee “squats” [ht: ja] in Greece, an alternative to the government-run camps. Best I can tell, all the work is being conducted collectively, as part of the commune:

There are cleaning teams, cooking teams, security teams, language lessons, art classes, children’s activities, beach outings, translators, Arabic lessons for volunteers and more.

Squats are run without government or major nongovernmental-organization influence and rely on donations and manpower from independent volunteers. Responsibility is divided among the residents. At Dakdouk’s original squat, a “local technical group” is the go-to for all maintenance and IT issues. There are plans to establish a bakery to produce bread en masse for residents and rooftop gardens to provide “for the soul and for the body,” says one group member.

I doubt anyone thought that was how communism would come to be established—among refugees, the most marginalized people in the world today. However, that may be exactly the communist horizon both Badiou and Brooks have in mind: noncapitalist communal activities that provide for both the soul and the body.

 

*Interested readers should consult the pioneering work of Jack Amariglio (e.g., “Subjectivity, Class, and Marx’s “Forms of the Commune’,” Rethinking Marxism, 22:3, 329-344) and Dean Saitta (e.g., “Marxism, Prehistory, and Primitive Communism,” Rethinking Marxism 1:1, 145-168).

 

12wage

Until recently, we were certain what would happen with an increase in the minimum wage—and that would be the reason to oppose any and all such attempts. Now, it’s a guessing game—and that uncertainty about its possible effects has become reason enough to oppose increasing the minimum wage.

What the hell is going on?

minimum_wage

First, the certainty: neoclassical economists confidently asserted that the minimum wage caused unemployment (because it meant, at a wage above the equilibrium wage, the quantity supplied of labor would be created than the quantity demanded). Therefore, any increase in the minimum wage would cause more unemployment and, despite the best intentions of people who wanted to raise the minimum wage, it would actually hurt the poor, since many would lose their jobs.

But, of course, theoretically, the neoclassical labor-market model was missing all kinds of other effects, from wage efficiencies (e.g., higher wages might reduce labor turnover and increase productivity) to market spillovers (e.g., higher wages might lead to more spending, which would in turn increase the demand for labor). If you take those into account, the effects of increasing the minimum wage became more uncertain: it might or might not lead to some workers losing their jobs but those same workers might get jobs elsewhere as economic activity picked up precisely because workers who kept their jobs might be more productive and spend more of their higher earnings.

And that’s precisely what the new empirical studies have concluded: some have find a little less employment, others a bit more employment. In the end, the employment effects are pretty much a wash—and workers are receiving higher wages.

But that’s mostly for small increases in the minimum wage. What if the increase were larger—say, from $7.25 to $10, $12, or $15 an hour?

Well, we just don’t know. All we can do is guess what the effects might be at the local, state, or national level. But conservatives (like David Brooks, big surprise!) are seizing on that uncertainty to oppose increasing the minimum wage.

And that’s what I find interesting: uncertainty, which was at one time (e.g., for conservatives like economist Frank Knight) the spur to action, is now taken to be the reason for inaction. And those who oppose increasing the minimum wage are now choosing the certainty of further misery for minimum-wage workers over the uncertainty of attempting to improve their lot.

Addendum

They want less of a guessing game?

Then, let’s make the effects of raising the minimum wage more certain. Why not increase government expenditures in areas where raising the minimum wage represents a dramatic increase for workers? Or mandate that employers can’t fire any of the low-wage workers once the minimum wage is increased? Or, if an employer chooses to close an enterprise rather than pay workers more, hand the enterprise over to the workers themselves? Any or all of those measures would increase the certainty of seeing positive effects for the working poor of raising the minimum wage.

But then we’re talking about a different game—of capital versus labor, of profits versus wages. And we know, with a high degree of certainty, the choices neoclassical economists and conservative pundits make in that game.

tmw-24-12

the-one-percent-what-now-493

The vow taken by compassionate conservative columnists appears to be “to have and to hold from this day forward”—unless you actually try to make a connection between inequality and poverty.

First up was David Brooks. Now we have Robert Samuelson.

So, what are they so afraid of? Apparently, that we will see “less economic inequality as a solution to all manner of problems” and that we will “imagine that punishing the rich will miraculously uplift the poor.”

No, we don’t need any miracles. As Brazil has shown, all you really need to do is give poor people enough money to end their poverty. Not so hard.

But, of course, that’s not enough—because it still leaves in place an economic system that continues to generate enormous misery at the bottom, which is both a condition and consequence of concentrating incomes at the very top.

As it turns out, the real fear on the part of the Brooks’s and Samuelsons of the world is that people will stop believing in miracles, actually make the link between poverty and inequality, and then demand an alternative set of economic arrangements—an inclusive, democratic economy that doesn’t generate either the obscene amount of poverty or the grotesque levels of inequality we see today.

There’s no need then to punish the rich. Just take a vow that, “for richer, for poorer,” we need to imagine and create a different kind of economy.

Genoa-Marx

Since I started this blog, I’ve read a lot of economic analysis and political commentary, much of it inane. But, I figure, it’s one of the services I can provide. Why should everyone have to work their way through that stuff when I can do it for them?

But you have to draw the line somewhere and, years back, I drew it at David Brooks. Talk about inane!

And then a friend comes along and sends me something I should take a look at. And so I did. It’s a review by David Brooks [ht: bn] of George Packer’s latest, The Unwinding: An Inner History of the New America.

Thanks to Brooks, I’m actually going to go out and purchase Packer’s book. However, the review is interesting for a very different reason: Brooks actually waxes nostalgic for Marxism.

I wish Packer had married his remarkable narrative skills to more evidence and research, instead of just relying on narrative alone. Combine data to lives as they are actually lived.

When John Dos Passos wrote the “U.S.A.” trilogy, the left had Marxism. It had a rigorous intellectual structure that provided an undergirding theory of society — how social change happens, which forces matter and which don’t, how society works and who causes it not to work. Dos Passos’ literary approach could rely on that structure, fleshing it out with story and prose.

The left no longer has Marxism or any other coherent intellectual structure. Packer’s work has no rigorous foundation to rely on, no ideology to give it organization and shape. But the lack of a foundational theory of history undermines the explanatory power of “The Unwinding,” just as it undermines the power and effectiveness of modern politics more generally.

Much to my surprise, I actually find myself in agreement with Brooks. The Left, such as it is today, doesn’t really have an intellectual structure that one might call Marxism. There is, of course, a lot of Marxism out there—the traditional kind Dos Passos relied on in the 1920s and 1930s as well as a radically new kind of Marxism, of the sort one will find in and around the journal Rethinking Marxism. And, it’s true, many radical thinkers and activists today, in the midst of the Second Great Depression, are rediscovering the usefulness of Marxist ideas. But there’s still a big gap, at least in the United States, between Marxism and left-wing ideas and political activities—and a lot of work that remains to be done to bring them together.

But, David Brooks, if it’s Marxism you want, to give “organization and shape” to the critique of the great unwinding that is contemporary America, well, let’s do it. We have a whole world to win.