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Marx: Don't call it a comeback; I've been here for years

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1codyed
Apr 21, 2012, 2:50pm Top

The Guardian profiles the American Marxist economist, Richard Wolff:

Richard Wolff sat in a downtown Chicago coffee shop and confessed he was having the time of his life. "I am a little like a kid in a candy store. I really am," Wolff said with a grin, using the sort of language not usually associated with the dry world of Marxist economics.

But then, the great recession, and the still-rumbling global economic crisis, has been good for the 69-year-old economist. He has gone from being a rare thing – an American Marxist – to something even rarer: a popular American Marxist.

For Wolff is in very high demand these days. Barely 24 hours goes by without Wolff being interviewed on one or more radio stations in America. He even has his own radio show that broadcasts once a week. He has appeared on TV, including on the conservative Glenn Beck show on Fox. He spends many days on the road visiting universities across the US, giving speeches to students and academics alike in lecture halls that are uniformly packed. This year alone he will have three books published. And through all that prodigious output his message is the same: American capitalism is on the way out.

2BruceCoulson
Apr 23, 2012, 11:31am Top

To be replaced by Chinese capitalism?

We don't have a capitalistic economy. What we have had, like most other nations in the Western World, is a 'managed economy'. Which is the way to say 'socialism' in polite company.

3krolik
Apr 23, 2012, 1:04pm Top

>2 BruceCoulson:

If that's 'socialism', then how would you describe the differences between these nations and others that were overtly embracing the label "socialist."?

Say, the U.S. with Nixon (I choose this example because of the wage and price controls, etc.) and Poland at the same time under Gierek?

Or do you think these differences are insignificant, and that at the end it all boils down to a comparable "socialism"?

4BruceCoulson
Apr 23, 2012, 1:43pm Top

I think differences are basically who receives the benefits. (Or whose ox is either gored or fed.)

'Socialism' became a bad word in the United States, and so the economic policy couldn't be called socialism, even though that's exactly what it was; public resources utilized to benefit select private individuals (alledgedly for the overall public welfare). As long the beneficiaries received those funds, they didn't care what it was called. What they DID care about was any attempt to divert those resources to someone else. (cf lobbyists.)

5krolik
Apr 23, 2012, 2:00pm Top

OK. Now let's line up the oxen and take a head count, or consider the select private individuals who were able to benefit from such an arrangement.

Are they proportionately similar?

Also: was the degree of public resources utilized similar?

Or do these quantitative considerations not matter too much to you? Is it the qualitative parallel that is foremost in your mind?

Maybe I'm misinterpreting you, but I have the impression that you're putting too much weight on one side.

In my opinion, the quantitative counts for a lot. Granted, lobbyists can be very unsympathetic characters, but historically and politically speaking, the difference between a lobbyist and an apparatchik is considerable. We're talking about real people here, and victims. It's not just an abstraction.

Or if we must stick to qualitative, there are other kinds of personal freedoms where I don't think these "socialisms" were comparable.

6Arctic-Stranger
Apr 23, 2012, 2:11pm Top

...public resources utilized to benefit select private individuals (alledgedly for the overall public welfare).

That is actually what we call "politics."

I think the definition of socialism is a bit more focused.

7BruceCoulson
Apr 23, 2012, 2:26pm Top

Socialism, by any name one wants to give it, is an economic policy. It says nothing about personal freedom, except in the economic sphere. (Where it says quite a lot.) As an economic policy, it has been practiced by relatively enlightened regimes (Great Britain and Canada post World War II) and highly repressive governments (Communist-controlled Poland, to use your example).

Most 'managed economies' (to use the socially polite term) divert public resources to already- powerful economic actors; corporations. (Although there is often some funding, always grudging, towards the average citizen.) The theory is that the government, and the general public, benefits from this use of resources by sustaining vital industries that keep people employed and the economy moving. There are arguments on both sides of this topic; government support of canals and railroads built a transportation network that did indeed provide ancilliary benefits to a large percentage of the population. On the other hand, such largesse has maintained companies and industries that under the pure capitalist model should have long since collapsed and been replaced.

So, a mis-managed economy certainly leads to glaring inefficiency (among other woes). And when vast sums are being controlled by a small group of people, then graft, bribery, and similar economic crimes are inevitable; even more so absent any sort of accounting for the use of those funds.

So, socialism's woes begin and end with how the economy is managed; who controls it, what level of oversight exists over those people, and what accounting is made of the returns on those public funds.

8krolik
Apr 23, 2012, 5:10pm Top

>7 BruceCoulson:

All very edifying. But, honestly, I do not feel morally improved.

Your description of "economic policy" is very much framed in morally- connotated terms (e.g., "pure" versus "crimes").

Not that there's anything wrong with that kind of conversation, in my opinion. But it does complicate things, more than you seem to allow for.

(I agree with Arctic that more focus is necessary. Otherwise words like "socialism," which have a lot of historical content, get drained of their meaning.)

Still, if we go down that moral road, we open the door for a discussion about what kind of values we're talking about, no? These values aren't necessarily universally assumed?

Such as: how much good or political viability does "a pure capitalist model" (to use your phrase) offer the world today? Can you cite a working precedent in the industrial or post-industrial world? Or is it an intellectual abstraction (akin to, say, the ideal of premarital abstinence among a certain kind of faithful) which does not have much traction in the empirical world?

With your "pure capitalist model," are you mourning a lost Eden that maybe didn't ever exist? How much of your economics is actually a faith-based initiative?

What chagrin to be surrounded by so many sinners!

I understand that a person can make an energetic case for such projects, and that the putative gains sound nice, but it's pretty clear, isn't it, that not everyone is on the same page here?

For starters: which part of the world are you talking about? Are you suggesting that there is a one-size-fits-all model for everybody (never mind history-region-religion-culture etc.), and this model happens (what a coincidence!) to be ours?. Oh, lucky us!

9BruceCoulson
Apr 23, 2012, 6:35pm Top

I didn't mean to imply a moral judgement of socialism. It's an economic system; whatever ills or benefits are derived from it, stem from purely human motivations in handling (or manipulating) the system. People have been happy (inasmuch as we can judge such an abstract concept) under every economic system from communism to capitalism, and equally as much unhappy under such systems.

I don't, generally, accept the idea of 'morality' in economic or government systems. Whose morals? Who gets to judge? This way lies theocracy. Rather, economies are successful the better they work towards the enlightened self-interest of the citizens. (Note the term 'enlightened'. There are a great many schemes that work quite well for immediate self-interest, from outright theft to elaborate scams. However, such plans are self-defeating in the long run; they either force a change in the system to make such schemes more difficult, or collapse the system altogether. Neither result is beneficial to anyone, including the schemer.)

Discussing a pure capitalist model is to enter speculation; barring a catastrophic collapse of the current system, (which would be ugly on all sorts of levels), I don't see pure capitalism becoming the economic engine of the world. The status quo is the state-managed economy. (One can observe the strength of capitalism...as a model...from the success of international drug cartels. Without government subsidies and support; in fact, in the face of armed opposition; the drug cartels are enormously profitable. However, excluding any moral judgement on the matter, I can't see the major multinationals adopting a similar model when the current one is profitable enough for legal companies.)

Crimes in an economic sense are easy enough to define without resorting to moral standards. The government (of whatever type) sets up the rules of the economic game. (e.g. saying that a particular company has good prospects when you, the seller, know this is not the case). If you break the rules of the game, you've committed a crime. Now, whether the rules of the game are 'fair' or the best way of ensuring the best prospects for all of your citizens is a political, not an economic, decision. Sometimes granting an exemption from the rules is an act of favoritism; sometimes it's the most just thing to do.

Economics in nowise is designed to 'morally uplift' your country or its citizens. No economic engine can possibly do this.

As far as what socialism is; it's the allocation of public funds/resources to a selected group of purely private entities, rather than to the public as a whole. The granting of land to railroads to encourage them to build lines to various states and cities directly benefitted only the owners of those railroads. It was not a grant offered to mill owners, nor to your average citizen. (This is opposed to, say, water treatment plants, which benefit everyone in the community.)

10Bretzky1
Apr 23, 2012, 6:57pm Top

As far as what socialism is; it's the allocation of public funds/resources to a selected group of purely private entities, rather than to the public as a whole. The granting of land to railroads to encourage them to build lines to various states and cities directly benefitted only the owners of those railroads. It was not a grant offered to mill owners, nor to your average citizen. (This is opposed to, say, water treatment plants, which benefit everyone in the community.)

I have to say that this is far from being the orthodox definition of socialism.

The standard definition of socialism is the public (i.e., governmental) ownership of society's means of production. That is, when government owns the steel mills and airlines and banks and car manufacturers, etc., then it has enacted a socialist policy.

What you have described is, I believe, generally described as "crony capitalism." Crony capitalism being a capitalist system in which profit is not derived from outcompeting one's competition for customers in the marketplace, but is instead driven by outcompeting one's competition for a preferred (even monopolistic) position in the marketplace through the attainment of preferential treatment from the government.

11madpoet
Apr 23, 2012, 10:21pm Top

There is an old Russian joke:

"Under capitalism, 'man exploits man'. Under communism, the reverse is true."

Capitalism and communism are both theoretical economic states. In reality, neither produces a functional and prosperous society. That's why almost every country today has adopted the 'welfare state', which is capitalism modified by socialism. Of course, there are exceptions, such as North Korea...

>9 BruceCoulson: "I don't, generally, accept the idea of 'morality' in economic or government systems."

I'd have to disagree. Every constitution begins with a preamble which states commonly accepted moral principles. "We hold these truths to be self-evident", etc. The French Republic claims the principles of "liberty, equality, fraternity", while Brazil's motto: "order and progress" is emblazoned on its flag. Order and liberty do not always comfortably coexist. Neither do equality and economic progress. Which does your country aspire to? You see how moral principles might have quite a bit to do with both government and economic systems.

12Lunar
Apr 24, 2012, 12:41am Top

#10: The standard definition of socialism is the public (i.e., governmental) ownership of society's means of production.

Well, yes. But even then the distinction between what is publicly owned and what is privately owned is no more substantial than the distinction between the government-hired goons in the armed forces and the government-hired goons at Blackwater.

13PaulFoley
Apr 24, 2012, 1:12am Top

I didn't mean to imply a moral judgement of socialism. It's an economic system; whatever ills or benefits are derived from it, stem from purely human motivations in handling (or manipulating) the system. People have been happy (inasmuch as we can judge such an abstract concept) under every economic system from communism to capitalism, and equally as much unhappy under such systems.

Some people, sure; but no "capitalist" country ever had the idea of building a wall to keep people in...

The standard definition of socialism is the public (i.e., governmental) ownership of society's means of production. That is, when government owns the steel mills and airlines and banks and car manufacturers, etc., then it has enacted a socialist policy.

But what do you mean by "own"? If the government exercises control, it's the true owner, whoever the nominal owner is.... It's just as much "a socialist policy" if the government tells "private owners" of steel mills, airlines, banks, etc., what to do as if it takes over those companies directly.

14BruceCoulson
Apr 24, 2012, 10:58am Top

>13 PaulFoley:

Thanks for more clearly articulating my point; that the difference between actual ownership of a company, and merely dictating policies of those companies, is marginal at best.

"We hold these truths..." is from the Declaration of Independence. "We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity..." is the Constitution.

I suppose one could say something about establishing justice and promoting the general welfare as being 'moral'. But you'll notice that insuring 'domestic tranquillity' comes before 'securing the blessings of liberty'. I don't think the order here is random.

And although economic progress can lead to inequality, I don't think that's inevitable.

15Bretzky1
Edited: Apr 25, 2012, 12:04am Top

#13

But what do you mean by "own"? If the government exercises control, it's the true owner, whoever the nominal owner is.... It's just as much "a socialist policy" if the government tells "private owners" of steel mills, airlines, banks, etc., what to do as if it takes over those companies directly.

But the government doesn't exercise control, so that's a mute point. It regulates, but that's not control. Control would be making decisions as to what gets produced, how much of it to produce, where to sell it, how much to sell it for, who to sell it to, where to produce it, how much to invest in new production, etc. Nothing of those decisions are being made by the government. Heck, they didn't even make those decisions when they took over GM and Chrysler, and they, for all practical purposes, owned the companies.

If you want to see what real control looks like, check out something like the British steel industry circa 1960 or the airline industries in any number of European countries before about 1980.

16lawecon
Edited: Apr 25, 2012, 1:10am Top

~11

"Capitalism and communism are both theoretical economic states. In reality, neither produces a functional and prosperous society. That's why almost every country today has adopted the 'welfare state', which is capitalism modified by socialism. "

So, we have reached the "end of history"? All previous ages were filled with stupid people who made collective choices different than we. But we, well, we're rational and prudent and clever and have chosen rightly, because we're just sooooo bright.

Got it.

Are you sure you're really in the right century? This sounds much more like what might have been said by someone in the 19th Century British Empire. Of course, a white upper class someone, but someone, nonetheless. They had longer arms in the 19th century, so it was easier to pat themselves on the back.

17theoria
Apr 25, 2012, 1:33am Top

Socialisme ou Barbarie.

18Lunar
Edited: Apr 25, 2012, 3:46am Top

#15: Are we just talking about a spectrum existing between soft socialism and hard socialism? 'Cause I don't really see a "freedom of enterprise" alongside freedoms of speech, press or religion anywhere. It may not be quite as blatant as it was with FDR's War Production Board, but the government still calls the shots on how businesses are run. Even that recent thing with the "pink slime" was the result of the FDA mandating the use of ammonia to sterilize beef trimmings.

19Bretzky1
Apr 25, 2012, 7:46am Top

Are we just talking about a spectrum existing between soft socialism and hard socialism? 'Cause I don't really see a "freedom of enterprise" alongside freedoms of speech, press or religion anywhere. It may not be quite as blatant as it was with FDR's War Production Board, but the government still calls the shots on how businesses are run. Even that recent thing with the "pink slime" was the result of the FDA mandating the use of ammonia to sterilize beef trimmings.

And that's regulation, not socialism. In a regulatory capitalist economy, the owners of capital can take their ball and go home, or leave the country with it for that matter. In a socialist economy the ball belongs to the government. Not to mention that the government doesn't "call the shots." Government certainly affects the viability of certain calls that can be made. For example, mandating a minimum wage reduces the number of workers a business can potentially hire. But the government isn't deciding who gets hired and fired, how much their salary will be (beyond it meeting the minimum requirement), what their duties in the firm will be, what their hours will be, whether they have to work on weekends or not, and numerous other aspects of the employer-employee relationship.

In the US, socialism has become a buzzword for onerous regulation and deficit spending, either of which might be bad economic policy, but neither of which is socialism.

20Arctic-Stranger
Apr 25, 2012, 2:35pm Top

And here is the rub. The purists, or ideologues, believe that ANY government intervention in ANY private enterprise is socialism. So regulation=socialism.

Most people go with the ownership model. If the government owns business enterprises, that is socialism.

I don't what they do with the Green Bay Packers, however.

21lawecon
Apr 25, 2012, 10:00pm Top

"And here is the rub. The purists, or ideologues, believe that ANY government intervention in ANY private enterprise is socialism. So regulation=socialism. "

And here is the rub. The collectivists and more-government-is-always- the-answer-to-every-ill pseudo-liberals believe that anyone who criticizes their myths can't distinguish between coherent (but ultimately silly) socialism and their incoherent faith position.

22madpoet
Apr 25, 2012, 10:47pm Top

>16 lawecon: Well, as Churchill said about democracy: "It has been said that democracy is the worst form of government except all the others that have been tried.”

I think the same holds true for the welfare state. It's not perfect, but it's the best we've come up with, so far. If you have a better idea, let's hear it.

Oh, that's right: you don't have ideas. You just have sarcasm. Right, lawecon?

23Lunar
Edited: Apr 26, 2012, 2:16am Top

#19: In a regulatory capitalist economy, the owners of capital can take their ball and go home, or leave the country with it for that matter.

Ah, yes. The mantra of the average American patriot. "If you don't like it, move to Russia!" It reminds me of PaulFoley's comment above about countries that build walls to keep their people from leaving. I guess it doesn't matter how heavily controlled business is. As long as people have the freedom to leave, it's not "socialism." It's not that I'm married to labels like "socialism." (I much prefer "authoritarianism") It's just that people who like to claim that what we have isn't pure socialism do it to whitewash the actual controls that are in place.

Not to mention that the government doesn't "call the shots."

But it does. It controls some things and not others, and your freedom to those other things can be legislated away at any point mostly without even raising any constitutional issues. For example, if you're in business in any of multiple states braiding African American hair without a license to braid white hair, you run afoul of the law. Oops. But I'm not supposed to say that the government calls the shots because... because the government gives you a pretty piece of paper saying that the salon is in your name? As if that's supposed to stop them from shutting you down?

#20: The purists, or ideologues, believe that ANY government intervention in ANY private enterprise is socialism. So regulation=socialism.

And here I was thinking: The purists, or ideologues, believe that ANY degree of independent decision-making is capitalism.

And there's a reason that in #18 that I contrasted the perception of free markets with the perception of free speech, press and religion. Let's take freedom of religion as an example. Let's say that we have all the religious freedoms in the world you could ask for except... you're not allowed to be a Sikh. Now, not many people in the US are Sikhs, but I doubt you'd be bitching about "purists" if I said it was an outright violation of religious freedom. Same with speech and press. What if you had those freedoms except that you couldn't say or publish anything critical of the president? After all, it's just that one subject that's being regulated. No reason for the "purists" to get their panties in a wad, right? Well, not really. We'd still call that censorship. But when businesses are regulated up the wazoo, we're not allowed to call that anything other than it's slave name. Fine. We don't have a pure "socialist" economy. We have a good ol' fashioned all-American "Toby" economy.

#22: Well, as Churchill said about democracy: "It has been said that democracy is the worst form of government except all the others that have been tried.”

OK, everybody. Time to vote on what madpoet gets to eat for breakfast. I nominate gruel. Remember, democracy may taste awful, but it's the best we've got! Otherwise madpoet might indulge in more bourgeois tastes and then where would we be?

24Bretzky1
Apr 26, 2012, 9:39am Top

#23

Ah, yes. The mantra of the average American patriot. "If you don't like it, move to Russia!" It reminds me of PaulFoley's comment above about countries that build walls to keep their people from leaving. I guess it doesn't matter how heavily controlled business is. As long as people have the freedom to leave, it's not "socialism." It's not that I'm married to labels like "socialism." (I much prefer "authoritarianism") It's just that people who like to claim that what we have isn't pure socialism do it to whitewash the actual controls that are in place.

No, they do it because words actually have meaning, a meaning that all people agree to, not just what individual people say the word means.

It does matter how heavily controlled business is to the definition of whether a country is socialist or not. Ownership of the means of production is what socialism is. Such ownership can be de facto as well as de jure, but the US hasn't even come close to approaching the level of control that would be required for it to be classified even as de facto ownership. Saying that the US has gotten all the way to a socialist economy is like someone climbing 10,000 feet up Mt. Everest and claiming they made it to the top. It's an insult to those people who have actually suffered through life in a real socialist country to say that the US is one.

25BruceCoulson
Apr 26, 2012, 11:04am Top

I would point out that democratic, 'capitalist' countries have built a lot of walls to control movement, both into and out of their countries. (In answer to #13.) So, it's not simply the act of an acknowledged tyrannical state.

We have had, then, a 'managed economy'; not pure capitalism, for the last 150 years. (And I'm not referring to regulations; I'm referring to allocation of resources to preferred private enterprises. Such government support to support/maintain a private business is anathaema under classic capitalism, which states that businesses rise and fall solely due to the market.) It's not crony capitalism (although there are a lot of elements of that system involved) because the government has the power (and has exercised it) to benefit private enterprises that lack political capital.

26krolik
Apr 26, 2012, 2:47pm Top

>25 BruceCoulson:

Could you say a bit more about when we had "pure capitalism?"

Thanks.

27BruceCoulson
Apr 26, 2012, 4:13pm Top

In the VERY early days of the (to be) United States; particular along the frontier, where the concept of government support, let alone regulation, wasn't even thought of.

Once the government had something to offer financially other than providing for domestic tranquillity and common defense, there were people who sought to gain that funding. In turn, people in the government thought that certain projects wouldn't be completed, or even started, without government assurances and support. (Please note that I'm trying to present this in as neutral a manner as possible, without trying to pass judgement on whether these concepts were correct or not.) So, the government, with very good intentions, began supply funding for projects that initially benefitted private concerns. (e.g railroads.) But once you've established the idea that the government HAS to supply money and support to private capitalists in order to accomplish major tasks, then expanding the number and nature of projects worthy of public funds to initially enrich private companies becomes much easier. And as the government has more to offer (consider the size of our present economy and government, contrasted with the 'socialist' (parentheses intended) New Deal) more companies are seeking financial backing for large projects.

So, 'pure' capitalism can only exist when the government lacks or cannot provide resources to private capitalists.

28madpoet
Edited: Apr 26, 2012, 11:07pm Top

>23 Lunar: "OK, everybody. Time to vote on what madpoet gets to eat for breakfast. I nominate gruel. Remember, democracy may taste awful, but it's the best we've got! Otherwise madpoet might indulge in more bourgeois tastes and then where would we be?"

You've totally missed the point. (Which I've come to expect from you, Lunar.) I was saying that the welfare state, like democracy, is not perfect. But it is the best we've come up with so far.

If it was a competition between 19th Century capitalism and communism, communism might still have some appeal. But when you have a capitalist system which has social programs such as public pensions, universal health care, unemployment insurance, etc., and workers can unionize to protect their rights and gain better wages, communism loses its appeal for the 'proletariat'.

29Lunar
Edited: Apr 27, 2012, 12:33am Top

#28: I was saying that the welfare state, like democracy, is not perfect. But it is the best we've come up with so far.

That's just an assertion. But the endemic age discrimination in the UK's Department of Health Services is very real. And in some circles, advocates of the european style welfare state are actually proud of the fact that they deny life-extending healthcare to the elderly. They seem to think it dignifying to send them home to die of treatable conditions. It's only natural that it should degenrate into one big government HMO. The only exception to this is Cuba which is renowned for its geriatric care... if only for the fact that the whole country is run by a bunch of 80-year-olds who don't plan on ceding power anytime before they give up the ghost.

30lawecon
Edited: Apr 27, 2012, 1:41am Top

~29

No, no, not at all Lunar. Whatever is has to be "the best we've come up with."

The present regime in North Korea is, for instance, "the best" that North Koreans have "come up with so far." Ask any North Korean who is still in North Korea.

Hence, it follows that the absolute monarchies and constant religious wars of Europe 500 years ago were "the best" the Europeans had come up with, the slave society of the Southern United States was "the best" Americans of that age had "come up with," and welfare states of truly civilized nations today are "the best" "we've" come up with "so far."

Everything that is, must be and is representative of PROGRESS. (As I said above, a true statement of 19th Century self-congratulation in place of rational analysis.)

Now if Mad will just send me his or her mailing address, I have this offer for a bridge participation that in unquestionably "the best" investment possible. It has to be. I just thought it up 5 minutes ago.

31Arctic-Stranger
Apr 27, 2012, 2:11am Top

#28: I was saying that the welfare state, like democracy, is not perfect. But it is the best we've come up with so far.

That's just an assertion.

A well founded assertion. Unlike the crap that gets bandied about concerning utopias.

32Lunar
Edited: Apr 27, 2012, 2:50am Top

#31: This has gotta be your favorite strawman. It's OK for welfare policies to make things worse because there's no utopia anyway, so fuck all. In the long run we're all dead.

Put the native Americans on Indian reservations. There's no utopia.
Put blacks in the Projects. There's no utopia.
Help the poor buy homes they can't afford and then leave them off worse than how they started. There's no utopia.
Pour money into the higher education bubble by creating a federal voucher system of grants and special subsidized student loans and when it causes tuition to balloon out of control, just say there's no utopia.
Give special tax breaks to HMOs bought through employers and when everyone becomes dependent upon employer-based healthcare... well, there's no utopia.

Saying there's no utopia is not an excuse for you to fuck up people's lives.

33Arctic-Stranger
Apr 27, 2012, 2:47am Top

Its not a strawman if sits in field and attracts crows.

34madpoet
Apr 28, 2012, 8:41am Top

>29 Lunar:. You must be an American. If you lived in a country that actually had universal health care, you'd know it works pretty well. No politician in Canada, who had any interest in getting elected, would advocate ending it. Don't believe the American insurance industry's propaganda.

35madpoet
Apr 28, 2012, 9:06am Top

>30 lawecon:. It's called 'history', Lawecon. Perhaps you've heard of it? You see, in history, we learn about other systems that have been tried, such as Communism. Various economic and social models, from Marxism to Maoism to Titoism have all been tested, and all pretty much failed. Some have even produced catastrophic famines.

Now let's look at the other side. Does history show us any Capitalist systems, without the nice social programs of the welfare state, and the legal protection of workers which goes with it? Hmm... Why, yes! I believe it does. Britain during the Industrial Revolution makes a nice example. Have you ever read any Charles Dickens? I believe he states the problem with that economic model better than any history book.

Societies and economies evolve. Systems that work survive. Systems that don't... don't.

But you haven't answered my challenge, Lawecon. If you have a better economic model to propose than the welfare state, let's hear it.

36lawecon
Edited: Apr 28, 2012, 9:22am Top

No, Mad, it is called a "theory of history," not "history." Your theory of history is at least a hundred years out of date.

Now that you describe it, it is not even the naive Victorian belief in Progress, it is rather a silly hybrid between Hegel and the Social Darwinists. As you say "Societies and economies evolve. Systems that work survive. Systems that don't... don't." Societies and economies are organisms, aren't they, Mad? (Ah, no they are not. It is much more complex than that, and that sort of evolutionism is nothing other than a linguistic tautology - "The fittest (read "the best" in your silly view) survive. They survive because they are the fittest.")

This isn't an "economic model," Mad. Remember, I am a former Economist. You obviously aren't. Economic models are testable. This isn't testable. This is a tautology - a quite defective faith position.

Try reading some economic history or some social theory in general rather than making this sort of thing up as "the spirit moves you."

37madpoet
Apr 28, 2012, 10:19am Top

Nice try, LE. I give you examples from history of other (failed) economic models, and you pretend I'm stating a theory. Like most economists you are ignorant of history, and proud of it. That's why economics, of late, has become the joke of academia.

'Economic models are testable'. Yes. The Soviets tested one. Failed. Mao tested one. Failed badly. (if you think China today is a communist country, you should come visit...) 19th Century Britain tested one. Did it succeed? Well, the British people weren't too happy with it. That's why they have a welfare state today.

Oh, I see. You mean 'testable' as economists talk about testing: by modeling it on a computer. You still believe in that? Seriously? After the last few decades? I'm speechless.

Still waiting for a response to my challenge... C'mon, show me your better economic system. I double dare ya.

38lawecon
Apr 28, 2012, 11:20pm Top

`37

Yes, very impressive. Perhaps you could instruct us in theology or philosophy next? Please do. I enjoy such displays.

39Lunar
Apr 28, 2012, 11:50pm Top

#35: Seriously? Charles Dickens? That's like getting dietary information from Upton Sinclair. And you're saying I'm the one buying the propaganda? Gee, I guess all that Walter Reed stuff was evil corporate propaganda too.

As for the Industrial Revolution, you're talking about a time when real wages for the working class rose at a steeper rate than at any other time in human history. As Ralph Raico once said, "If you want to see what happens when you have an agricultural revolution without an industrial revolution, look at Calcutta."

40codyed
Apr 30, 2012, 7:05pm Top

Tim Worstall, a right-of-center writer, provides a Marxian analysis of why Foxconn raised the wages of its employees. He believes Marx provides a better explanation for the rise in wages than the intense political outcry by labor activists in the West.

41Carnophile
Apr 30, 2012, 10:32pm Top

I read that article and absorbed this:

Supply and demand, competition, and general equilibrium effects operate in the labor market. No kidding!

Ignoring the Marxist jargon "reserve army," is there anything in that piece that a Chicago-school economist would object to?

42codyed
May 1, 2012, 2:19am Top

Who knew Chicago-school economists had so much in common with Marxists!

43Lunar
May 1, 2012, 5:03am Top

#42: Except the Chicago school is primarily known for ripping off Keynes, not for ripping off the discovery of supply and demand.

44Carnophile
May 1, 2012, 10:44pm Top

Who knew Chicago-school economists had so much in common with Marxists!

I predict a tearful rapprochement on Ricki Lake!

Except the Chicago school is primarily known for ripping off Keynes.

Wha... wazza... huh? (Sputter.) What the fuck? I hope you don't have rhetorical superweapon coming my way, but if you do, it will be worth being blown up just to satisfy my curiosity about WTF you're talking about!

45codyed
May 2, 2012, 12:37am Top

Damn, dude. I wouldn't go that far. I'm sure Chicago borrowed from Keynes to some extent, but there are important differences. For example, Chicago-school economists tend to support Say's Law while Keynes rejected it.

46Lunar
May 2, 2012, 1:25am Top

#44: Keynes is where Chicago schoolers got the idea of manipulating interest rates. They may have differed in how important a factor it was compared to government spending, but the influence is there.

47lawecon
May 2, 2012, 7:34am Top

~46

Ah yes, well, if Mark Skousen says so in the Freeman, well, that ends all doubt. Unfortunately, Mark would be dead wrong if this is a proper interpretation of what he was saying.

Keynes and the Keyesians didn't believe in "manipulating interest rates." They believed that attempts to affect economic activity through manipulating interest rates was impossible because of a "liquidity trap" that developed under conditions of depression.

Neither did classical Chicago School economists believe in manipulating interest rates, they believed in manipulating monetary aggregates.
Friedman has extensive critiques of FED planners who attempt to affect economic activity by manipulating interest rates.

But don't worry, this may be the Party Line at the moment. So accuracy really isn't important.

48Carnophile
May 3, 2012, 9:44pm Top

Pffffft. The article you linked mentions Friedman stating that he and others at Chicago were Keynesian in the 1930s and 1940s. That's not what people mean, now, when they talk about the Chicago School.

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