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There are a number of economic problems facing our society. Income inequality, both within and between nations, is rising to levels seen in the 14th century. The side effects of many industries, such as pollution, exploitation, and other social harms, continue to devastate large parts of the world. And an increasing number of people are having trouble making ends meet while being surrounded by material wealth.

As the debate around these problems and potential solutions continues, it begs the question: Is a capitalist-socialist economy inevitable? A few Big Thinkers have weighed in on the topic.

The current economic system simply isnt working for a lot of people, according to Timothy Snyder, the Levin Professor of History at Yale:

The United States is a country which is among the least equal in the world. According to Credit Suisse, which is a Swiss bank and not some kind of crazy left-wing organization, we are second in the world in wealth inequality after the Russian Federation. In the United States since the 1980s, basically 90 percent of the American population has seen no improvement in either wealth or income. Almost all of the improvement in wealth and income has been in the top ten percent and most of thats been in the top one percent and most of that has been in the top 0.1 percent and most of that has been in the top 0.01 percent, which means that not only are people not moving forward objectively, but the way they experience the worldand this is very powerfulis that other people are on top.

That the economy isnt working for everyone isnt a new idea. Still, according to author Anand Giridharadas, the notion that markets would fix all has been pushed even when the evidence against it is at hand:

There is a way in which American elites, and this is not just a couple of greedy hedge fund billionaires, the American intelligentsia also has been complicit in a false story. Rich people and wealthy corporations spent a generation waging a war on government, defunding government, allowing social problems to fester and allowing their own profits to soar.I was sitting in Michigan in Econ 101 and I remember getting this lecture on how all this stuff was for the good and we would be better off. And right around us, all around us in Michigan in 1999 the state was falling apart.

Dr. Ioannis Yanis Varoufakis, former Minister of Finance for Greece and currently a left-wing member of that nations parliament, told Big Think that the failures of our current system affect everybody:

We have billions of people working like headless chickens, driving themselves into depression and going home and crying themselves to sleep at night if they have a job, or consuming antidepressants and becoming obese and seeing shrinks if they dont have a job. In the end, we have a joyless economy. Even those who are extremely powerful, in theory, the haves of the world, are increasingly feeling insecure. They have to live in gated communities because they fear all the have-nots out there that envy their wealth. In the end, we have developed fantastic means of escaping need and escaping want which we are not putting to good use because, in the end, we are developing new forms of depravity and deprivation and universalized depression, psychological depression, which is incongruent with our fantastic advances at the technological level.

So, now that were discussing alternatives to neo-liberalism, what options are on the table?

The current economic system favored by most industrialized countries is the mixed economy. This is best described as a capitalist system with elements of a planned economy thrown in. Its nothing new; versions of it predate Rome. The question being debated in most countries is not whether there should be a mixture of markets and state intervention but rather what that mixture should be. Today, we are in an era where freer markets and less intervention are popular approaches, but this is a fairly new development.

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A few decades ago, even capitalist countries employed planning. For example, in France, the government guided the market-centered economy through the use of indicative planning, a type of economic planning in which the government sets general targets and priorities for economic development but does not directly control the production and distribution of goods and services. This policy was in effect for decades now known as the Thirty Glorious Years. Similar policies existed in Japan and India.

In the Nordic countries and China, the state owns or controls a large share of many enterprises. In Norway, the oil industry is owned by the government and actively invests in other companies. While state ownership has declined in Scandinavia, the various national governments still own many businesses across many industries. In the southern United States, the federal government still owns and operates the Tennessee Valley Authority.

Even the more market-oriented countries rely on state intervention such as regulation, welfare, and macroeconomic policy to correct market failures. Moving to a model with more intervention would be fairly easy in terms of policy implementation. Weve done it before, it is merely a question of if we want to again.

Most major economies today are operating on a blend of capitalism and socialism. Given the problems many industrial economies face today, a reevaluation of which blend we are using may well be in order. Dr. Varoufakis party calls for market socialism. John Fullerton has pushed for a re-imagination of how we approach economics and recently wrote a book on regenerative economics. Wendell Pierce, an actor and businessman, considers himself a true capitalist while also calling for increased social services, such as improved public education.

Whatever we pick, wed do well to remember the words of former Chinese leader Deng Xiaoping: It doesnt matter if a cat is black or white, so long as it catches mice.

See original here:
Is a capitalist-socialist economy inevitable? - Big Think

The decision of a Russian court to keep Wall Street Journal reporter Evan Gershkovich in jail suggests a few reflections. I put court in scare quotes for reasons to be explained below. Political economists are interested in such issues because they widely consider an impartial justice system as one of the essential institutions of a free and free-market society.

The Wall Street Journal writes (Russian Court Upholds WSJ Reporter Evan Gershkovichs Detention, April 18, 2022):

The hearing was held behind closed doors, as is typical for most hearings connected with espionage charges. It is also exceedingly rare for defendants to win appeals or be acquitted in such cases in Russia, where espionage laws are increasingly wielded for political purposes, according to Western officials, activists and Russian lawyers.

Russias Federal Security Service, the successor to the KGB, said the journalist acting on the instructions of the American side, collected information constituting a state secret about the activities of one of the enterprises of the Russian military-industrial complex.

Thats what journalists from free countries do, isnt it, even without instructions of the American side?

In my review of Volume 2 of Friedrich Hayeks Law, Legislation and Liberty, I emphasize why the Nobel economist considered a socialist (or fascist) judge as a contradiction in terms (see also his The Constitution of Liberty):

Hayek wages a frontal attack against the doctrine of legal positivism, represented by Hans Kelsen, John Austin, and other legal theorists. The doctrine claims that law is simply what is decreed by the sovereign. As Thomas Hobbes put it, no Law can be Unjust. In the same vein, Soviet legal theorist Evgeny Pashukanis, wrote that under socialism laws are converted into administration, all fixed rules into discretion and utility. Not protected by law, Pashukanis was later eliminated by Stalin. Contrary to state decrees, Hayek argues, law can only be made of general rules that meet general agreement among the public.

Quoting Hayek directly Volume 1 of the same work:

[A judges] task is indeed one which has meaning only within a spontaneous and abstract order of actions such as the market produces. A judge cannot be concerned with the needs of particular persons or groups, or with reasons of state or the will of government, or with any particular purposes which an order of actions may be expected to serve. Within any organization in which the individual actions must be judged by their serviceability to the particular ends at which it aims, there is no room for the judge. In an order like that of socialism in which whatever rules may govern individual actions are not independent of particular results, such rules will not be justiciable because they will require a balancing of the particular interests affected in the light of their importance. Socialism is indeed largely a revolt against the impartial justice which considers only the conformity of individual actions to end-independent rules and which is not concerned with the effects of their application in particular instances. Thus a socialist judge would really be a contradiction in terms.

In my review, I wrote:

I would add that this crucial point would also apply to a fascist judge, and Hayek would certainly agree.

This is why Russian courts are courts in name only. They are instruments of government policy. For the same reason, what the apparatchiks call law is synonymous with government commands, its not law in the classical sense. When Vladimir Putin is said to be a trained lawyer, the second term also cries for scare quotes. When Putin said that he wanted a dictatorship of the law, he meant nothing more than a dictatorship of the dictator (and perhaps of the majority). In Russia, this is not new. Their plagiarism of Western law is a Potemkin village.

Was Gershkovich a spy for the American government? I dont know, but I know two reasons why it is very unlikely. First, the Wall Street Journal has a reputation and a brand-name value to maintain, which serving as a CIA cover would destroy. After all, the WSJ is not Fox News even if, alas, the two publications have shared a common ownership since late 2007. To sell information, as opposed to entertainment or confirmation bias, a financial newspaper needs to be, and perceived to be, independent. The second reason is that we cannot count on the unrestricted liars in the Russian government nor on their judicial minions to tell us anything useful about journalistic activities.

It is true that, over the last 100 years or so in history of the free world, the law has not moved in the right direction, as Hayek detected long ago, even crying wolf too early in the opinions of some. Like virtually everything, the liberal rule of law is a matter of degree, at least up to a point. But there is no doubt that Western countries are still freer than Russia, which is why you read this blog. Like many economists who have studied the question (including James Buchanan and, yes, Anthony de Jasay too), we should continue to defend the endangered ideal of (classical) liberalism.

See the original post here:
A Socialist Judge Is a Contradiction in Terms - Econlib

Last week, the New Left Reviews Dylan Riley published a brief, barbed polemic against those adherents of neo-Kautskyite socialism a tendency with which this magazine is reputed to be associated who cling to illusory visions of new New Deals, green or otherwise.

Riley was categorical: No socialist should advocate an industrial policy of any sort. Any future attempted New Deals will prove self-defeating. And those who dont see this have fallen victim to a fatal error: theyve failed to reckon with the structural logic of capital.

Rileys admonition is a reminder of the strange itinerary that the structural logic of capital has traced over the past century and a half. Karl Marx was the great pioneer of the concept of course. His lifelong intellectual project was to uncover the systems inner laws of motion and then to ask: If you have a society propelled by such inner dynamics, in what direction is it likely to go?

His answers to that question almost always involved some mechanism by which capitalism could be shown to be undermining itself or preparing the ground for socialism: Competition bred ever-bigger factories that required ever-more sophisticated planning of production. Capital accumulation gathered up scattered proletarians from the global countryside and concentrated them in crowded factory towns where they could learn of their common interests and organize against the system. And so on.

For Marx, reform was another of these dialectical boomerangs. Capitalism could not stop breeding movements to reform capitalism. These movements had the effect of strengthening the political muscles and sense of self-efficacy of the working class, and this, for Marx, was yet another example of the system putting shovels in the hands of its own gravediggers.

The leading instance of such reforms in Marxs writings was the English Ten Hours Bill (in its several iterations), the object of a great working-class movement in the era of Owenism and Chartism a thirty-years struggle fought with admirable perseverance, as Marx recounted in his 1864 inaugural address to the International Workingmens Association.

And he was unequivocal about the outcome: the reform legislation limiting the length of the working day had been a smashing success. The immense physical, moral, and intellectual benefits hence accruing to the factory operatives, half-yearly chronicled in the reports of the inspectors of factories, are now acknowledged on all sides.

But besides all this, the movement yielded another great benefit.

Throughout the struggle for ten hours, a constant line of attack by bourgeois writers opposed to the reform had been that, if enacted and enforced, the legislation, by driving up production costs, would spell economic calamity for British industry harming the very factory hands it was designed to protect.

In other words, though they may not have used the phrase, the bourgeois opponents of the Ten Hours Bill were appealing to the structural logic of capital to demonstrate the folly of the reform.

For Marx, one of the great achievements of the ten-hours agitation on a par with the actual improvements in the health and happiness of the workers that resulted was precisely how it discredited that kind of critique, and how it vindicated the idea of social production controlled by social foresight even within the bourgeois mode of production:

There was something else to exalt the marvelous success of this workingmens measure. Through their most notorious organs of science, such as Dr. Ure, Professor Senior, and other sages of that stamp, the middle class had predicted, and to their hearts content proved, that any legal restriction of the hours of labor must sound the death knell of British industry, which, vampirelike, could but live by sucking blood, and childrens blood, too. . . .

This struggle about the legal restriction of the hours of labor raged the more fiercely since, apart from frightened avarice, it told indeed upon the great contest between the blind rule of the supply and demand laws which form the political economy of the middle class, and social production controlled by social foresight, which forms the political economy of the working class.

Hence the Ten Hours Bill was not only a great practical success; it was the victory of a principle; it was the first time that in broad daylight the political economy of the middle class succumbed to the political economy of the working class.

If any structural logic of capital was at work in the saga of the ten-hours movement, for Marx, it lay in capitals endemic tendency to generate reform movements in opposition to itself not, as the middle-class sages of science had claimed, in condemning any reform measure to futility.

If we fast-forward a century or so, however, we find these intellectual positions drastically reconfigured.

By the middle of the twentieth century, the political economies of the industrialized world had been transformed by forms of state intervention that Marx and his comrades in the International Workingmens Association could scarcely have imagined. Wide swathes of industry were nationalized. Wage schedules were set in national agreements. Capital-controlled banking systems were under the thumb of national central banks, now accountable to finance ministries that answered to parliaments elected by universal suffrage. Governments committed to full employment held jobless rates to levels once thought impossible.

Intellectuals on the right wing of the socialist and labor movements neo-revisionists like the British author and politician Anthony Crosland began claiming that in this new era of full employment and uninhibited economic management, capitalism had ceased to be capitalism and the workers movement no longer needed to push for any deeper transformation beyond an endless series of piecemeal reforms.

It was in this context, in the 60s and 70s, that self-consciously revolutionary writers on the Left seized on the notion of a structural logic of capital as a weapon in the fight against the new revisionism.

If the capitalist mode of production can ensure, with or without government intervention, continual expansion and full employment, then the most important objective argument in support of revolutionary socialist theory breaks down, wrote David Yaffe, a key figure in the capital logic current of intellectual Marxism, in a 1973 article.

It was thus vital to furnish arguments showing why such a stabilization was impossible, and this was done in works by such writers as Paul Mattick and Roman Rosdolsky by plucking out of relative obscurity a suggestion that could be found in scattered passages of Marxs voluminous economic writings but had, until then, only occasionally been the focus of sustained consideration from Marxists: the idea of a lawlike tendency for the profit rate to fall.

The great nineteenth- and early twentieth-century defenders of Marxist orthodoxy, most prominently Karl Kautsky and Rosa Luxemburg, had been dismissive of falling-profit-rate theories on the rare occasions when they felt the need to acknowledge them at all, and certainly did not believe that such a tendency could be granted a central role in Marxist crisis theory. (Luxemburg was especially biting in her disdain for the idea. Responding to an enthusiast of the theory who had reviewed her Accumulation of Capital in a German socialist newspaper, she wrote: There is still some time to pass before capitalism collapses because of the falling rate of profit roughly until the sun burns out.)

But since the 1970s, the canonical status of falling-profit theory in the corpus of orthodox Marxism has become a kind of invented tradition. Its centrality in the pantheon of Marxist ideas, though widely seen as primordial, is no more than a few decades old, and its function has always been ideological: to demonstrate the futility, perversity, or jeopardy of social democratic reforms.

Ill save for a subsequent article a more thorough discussion of the various theories of falling profit including the novel version advanced by the UCLA economic historian Robert Brenner, which has become something of a house theory at the New Left Review over the past twenty-five years.

Suffice it to say that when the New Left Review invokes it to warn that the structural logic of capital will somehow render futile measures to promote green technologies, due to a massive exacerbation of the problems of overcapacity on a world scale, it illustrates the rhetorical dilemma of an anti-reformist left whose struggle against anachronism has forced it to stand Marx on his head.

Link:
Karl Marx Knew That the Struggle for Reforms Was Part of the ... - Jacobin magazine

Her least talked about blunder is the decision to nationalise the wholesale trade in food grains in April 1973.

Yashwant Deshmukh & Sutanu Guru

Published: 18 Apr 2023, 6:53 PM IST

The transformation of the late Indira Gandhi from a Goddess Durga-like figure in 1971 to an unpopular autocrat who imposed the Emergency in 1975 is a case study of historical blunders.

(Photo: Vibhushita Singh/The Quint)

(This is Part Two of a four-part 'April' series that revisits significant historical events or policies and how the lessons learned from them continue to be of relevance in present-day politics and society. Read the first part here.)

The transformation of the late Indira Gandhi from a Goddess Durga-like figure in 1971 to an unpopular autocrat who imposed the Emergency in 1975 is a case study of historical blunders. In hindsight, contemporary historians and pundits talk more about her political missteps that led to mass protests against her regime. But the real blunders she committed after her famous election victory in 1971 were in the arena of economic policy making.

Arguably, her least talked about historical blunder is the decision to nationalise the wholesale trade in food grains in April 1973. The reverberations of that decision are still felt in India after 50 years. There are three aspects here.

The first is the perception that traders and hoarders habitually fleece and loot farmers of their legitimate dues. The second is the stubborn belief of many Indians that market forces are not good for farmers and consumers. The third is the persistence of a crisis-like situation in Indian agriculture.

The withdrawal of the three farm laws by the Narendra Modi government in November 2021 is a powerful symbol of all the above-mentioned legacy hangovers.

What really happened in April 1973? It is well known that Indira Gandhi adopted hard socialism in the economic policy-making arena. The mistrust of the private sector that was cultivated since independence in 1947 became a credo under her. Her advisors believed that the state had the answer to all economic problems. So, when repeated failure of monsoons triggered a massive supply problem of food grains, Indira Gandhi and her advisers blamed private sector hoarders for shortages of wheat and rice, and thought the state could fix the problem.

The crisis was genuine. Food grains output in India was 108.4 million tonnes in 1970-71. It plummeted to 97 million tonnes in 1972-73; recovered somewhat to 104 million tonnes in 1973-74 and crashed again to 99.8 million tonnes in 1974-75.

One vividly recalls standing for hours outside a ration shop in unruly queues for wheat and rice. Those less fortunate than the authors often had to skip meals because they couldnt access wheat or rice; like the hapless citizens of Pakistan today. Shortages triggered double-digit inflation. The sky-high popularity of Indira Gandhi that had soared after the 1971 war against Pakistan and the creation of Bangladesh started to plummet in 1973.

The legendary journalist cum author Khushwant Singh wrote for The New York Times in 1973: Soon the buffer stock was almost exhausted, but the Government was loath to take around the begging bowl to affluent nations, particularly to the United States, which had supported Pakistan against India in the Bangladesh affair. Once again this spring, the dream of India's becoming selfsufficient in food seemed to be turning to a nightmare; drought and famine stalked the land and the old lament was heard: India's prosperity is a gamble with the rains.

The prime minister's response was to nationalise the wholesale trade in food grains; an extreme example of her garibi hatao chant that led to her sweeping victory in the 1971 Lok Sabha elections. The logic appeared simple: private traders cheated and exploited poor farmers leading to a shortage of food grains. The state would not only pay more remunerative prices to farmers but also eliminate the scourge of hoarding that resulted in shortages and high prices of food grains, particularly those of wheat.

Jospeh Stalin in the Soviet Union and Mao Zedong in China had done the same. No wonder, the Marxists applauded the revolutionary decision. Mind you, there was popular support for the move as traders were a hated community as displayed so evocatively by Bollywood movies of that era. But Indira Gandhi perhaps forgot that the road to hell is paved with noble intentions. The food grains crisis actually worsened after nationalisation and shortages became even more acute.

Within one month of her nationalising the food grains trade, food inflation soared as the Rabi harvest of wheat was far lower than expected. One of the worst four months of inflation seen in independent India was seen from April to July 1973, immediately after the revolutionary decision.

The Arab-Israeli war and the decision by OPEC (Organization of the Petroleum Exporting Countries) to raise crude oil prices in late 1973 delivered a knockout punch, as inflation in December 1973 was 26 percent higher than in December 1972. There is a growing tribe of analysts that argue now that the events leading to mass protests by students in Gujarat and Bihar culminated in the Total Revolution called by Jayaprakash Narayan, and that the imposition of Emergency were triggered more by economic hardships than political factors. The authors think the analysts have a compelling case to make as the data does back them up.

Within a year, a chastened Indira Gandhi realised the folly of her revolutionary decision, and the policy was abandoned. Private traders went back to their traditional task of cheating and looting poor farmers. Fifty years down the road, the aftermath of the Green Revolution has ensured that food shortages in India are a thing of the past. But attitudes and prejudices prevalent fifty years ago still persist.

Too many Indians are still convinced that Indian farmers cannot survive and thrive without the clutches offered by a Mai Baap Sarkar. It is a mystery why this perception still persists.

There is no doubt that private sector players are not angels or dripping with generosity. Yet, there is ample evidence since 1991 to show they have created near miracles in many sectors.

We have all been asking a question since the early 1980s without getting an answer: if Bajaj can selltwo-wheelers anywhere it wants in India, why cant the Indian farmer do the same with their produce?

(Yashwant Deshmukh & Sutanu Guru work with CVoter Foundation. This is an opinion piece and the views expressed are the authors' own.The Quintneither endorses nor is responsible for them.)

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

Read more from the original source:
April, Indira, and Nationalisation of Grain: The Failure of 'Hard Socialism' - The Quint

'I feel so uneasy about the tone of the recent deluge of letters published here...Let's all dial back the personal rhetoric and attacks'

The author writes in response toLetter: Chippewa renaming issue is symbolic of a deeper problem.

To the editor:

I promised myself that I would try to be a more private, introspective person this year. I deleted my social media. I don't have many friends. I work. I generally keep to myself. But I just can't leave Monday's opinion pieceby Ian Saundersunaddressed.

Firstly, I have to disclose three things.

1) I haven't followed the issue closely. And the naming of the school, I'm sure, isn't what makes me feel compelled to respond publicly. Frankly, when the decision was made in 2017, it seemed like a reasonable thing to do after combining two schools into one. That there is a consultation process with Indigenous representation to help create greater cultural understanding, I thought, was a bonus.

2) I know Erika and her family.

3) While I'm still learning and I don't fully understand the meaning (or usefulness) of such political terms, I would not defend myself against the charge of being a socialist or "woke." In fact, if I do understand them correctly, I would be proud to earn such labels.

That said, I feel the need to respond publicly because I can't shake the feeling that this issue is personal. This issue has struck a chord deep in the weeds of the culture wars and Erika has become a target. I also feel like our local media, and BayToday in particular, in a search for issues that generate "engagement" ($$), has contributed to a hyper-focus on Erika.

I want to remind everyone that the people in these roles are real people who live in our community. I feel so uneasy about the tone of the recent deluge of letters published here. Never mindthat she wasn'teven on the board in 2017. Or that a committee is in place to provide recommendations to the board. Let's all dial back the personal rhetoric and attacks.

And while I'm at it, remind me why we're so excited as a community to demonize Erika. The writer of Monday's piece told us that she represents a serious threat to our community (even though the authordoesn't live here) because of her "wokeness" and her socialism.

Is she accused of trying to improve a system for people facing real and historic social barriers?

I thought that's what we meant by "woke."How dare she

Socialist? She thinks there's too great a divide between the rich and the poor and would like to use our public institutions to improve that gap. Isn't that what public policy solutions from the left look like?

Have we completely lost our way? Why do I feel like what is really threatening to people like Ian Saunders is a smart, assertive, super hard-workingwoman who challenges existing power structures from the left side of the political spectrum? If Erika is a "woke"socialist, then I hope to have the courage to be more like her one day.

Scott RobertsonNorth Bay

Editor's note: Robertson is a former North Bay city councillor and federal NDP candidate inNipissingTimiskaming.

Originally posted here:
Letter: In defence of 'woke' and 'socialist' school board chair - BayToday.ca