The world’s economies have been morphing into an international conglomeration for several centuries now, perhaps even longer. Money is not as old as man, but we have yet to access exactly and fairly how man values items, thoughts, fears and the distribution of goods among families, tribes and enemies fully throughout the dark recesses of time and even up until today where bitcoin has complicated things even more. Economic archeology should be a starting point for school classes to at least understand what happens when one moves past bartering, or what, indeed is valuation when bartering. That is an interesting concept for the first stages of infant learning; note psychologists’ “one or two donuts (or marshmallows!) for waiting” experiment in order to understand how to value the future of one’s own world.
Human economics, a social science, deals with emotions as well as science, in other words a philosophy of interchange and exchange needs to be constructed and sold to a group. All animals have some form of sharing of the burden within the higher species, though we’re also finding cooperation among lesser animals, and even plants. But that is another musing. For humans, the future beyond simply surviving needs to be considered, as does a trust or a gamble on its arriving as one hoped it would. Art, though, as in life often examines/exposes the times when one is foiled, fooled or flabbergasted in the future not arriving as one hoped.
In economics over the time of imperialism, to capitalism, to industrialization, to urbanization, humans have struggled with the impact of overlapping cultures, traditional stratification of societies into groups of laborers and owners, how property is managed, what is property, and who “owns” property. The polarization on the extremes occurred in the 19th century when a historical economist, Karl Marx, opined that earlier man exploited the laborer and continues up to the present and it was time for the urban proletariat and other laborers to take back the power. Before him Rousseau spoke of a system of social conscience and the continuing roots of social inequality, seeking his own form of social reckoning. How might you assess the present status of economic philosophy in the digital age?
Over the past decades, the argument of government involvement in mitigation of the economy has been foremost in politics. Yet, those arguments have strangely morphed and moved among the principal parties in the States. One might argue that government in general is on the block, with either apathy or antagonism towards politics occupying a significant portion of the potential electorate. Does democracy deliver; study a bit more history to find out.
The electorate; one need only turn eighteen in most states, in all states as long as you do not have a felony record. Some states have a criminal record to restrict voting rights (some equate it as a reaction within the Jim Crow era), even to eliminate whole groups of people from being involved in managing the public purse and power. These sentiments and actions have had meaningful impact on the nation’s history and present demeanor. Voter rights and regulation are the current buzz words in the MAGA era, as is The Southern Strategy, gerrymandering and a host of other methods to temper/tamper one’s means of reaching the polls.
To best incorporate all of the factors in your thinking, the old ones of wages, owners, profit, expenses, quality and distribution are still there. But, the changes incurred through the more recent era of containerization of distribution and either ignorance of or avoidance of qualitative reckoning in a purchase have moved the source of labor overwhelmingly towards inexpensive pools of labor in overseas countries (or Mexico) that are limited in their regulation of production and its affluents. Waste, changing weather patterns and tides, and contamination are starting to be felt on a most personal level everywhere in the world from this ignorance. Will the cost to the environment now be a major factor in commerce and in the laws or will it only spill out through the occasional protest or boycott?
To attend to the common good, and to maintain as much freedom as Locke, Rousseau and other 18th century philosophes hoped was possible, one must ask if the government is a necessary and critical factor. For the Republican Party since the time of Reagan, when he famously stated the government is the problem, the party believed unfettered markets would deliver the best product. Let’s explore that concept.
What is your part in all of this? Are you a scorpion; are we, in the end, all scorpions? The Harvard Business Review examined six new books on economic thinking and opened its article with the parable of the toad and the scorpion. The rest of this musing will attend to the common good, from the national perspectives which were paramount in the past few centuries, to the present perspective that begs for a wider lens to include global commonalities and overlapping goals for the world in this crisis environment.
In exploring history, Keynes and Hayek, writing about and concluding their premises from the evidence of the Great War and ensuing Depression, sought to offer explanations and solutions. Hayek pushed for classic Adam Smith capitalism, Liberal with a capital “L” and unfettered capitalism to keep down unemployment and offer efficient factors towards improved efficiency, better profits and a “tide rising all boats”. While Keynes argued that government’s thumb on the scale of the economy would insure better employment through regulation and protections for labor from the forces of the market, and board room, that would harm society.
After the debacle of the failures of the 2007-2009 event that is called The Great Recession, the government took the decision to save the banks. We can explore that option, though it would need its own musing. Did the banks, and the government, learn from their decisions a better way to regulate the market? The esteemed magazine, Newsweek, ran a headline We Are All Socialists Now. Though, some economists felt the government’s decision aimed at saving the home buyers instead of the banks would have been better. But, some people owned many homes and were part of a rentier rearrangement and a new class of capitalists. Should second, third or sixth homes, none of which were ever occupied by the owner, and perhaps even an LLC-owned home, also be allowed to exist? Cities fighting AirBnB are asking the same question.
In today’s world, one only a bit over a decade from The Great Recession, we see capitalism’s memory is horrible and relentlessly one side pushes for the rising tide option. The Government needs a philosophy of economics and a clear understanding of socialism and Marxism as philosophies. Each has the government’s thumb on the scale with the government either owning some responsibility or perhaps all of the responsibility. Did Marx really want every decision to be made by a commune? Was it Salem we need to worry about, or The Handmaid’s Tale that could arrive from communal commitments to and control of society’s directions by a domineering and impassioned government with oversight over ever dollar spent by it associated to its employees and citizens alike? Does the U.S. Constitution have an economic moral barometer and trigger point?
Fine tuning the power of government must involve the economy with some form of philosophy, and perhaps always coupled with the environment from now on-even Nixon was strangely sympathetic to this concept. Tariffs were the solution in the early, 18th century, discussion in the time of mercantilism when the fight was about mercantilism versus the free market with one nation’s overall economic health the goal. But today’s world is much more global and the old ideas and ways are now much more intertwined and complex. Trump pushed tariffs to mitigate competition, so does Biden. What will the future economic leaders feel to about government oversight?
The Columbia professor, Joseph Stiglitz, was one of the six books mentioned by the Harvard Business Review. His new book is The Road to Freedom: Economy and the Good Society. He has certainly tied economics to the function of government in a very dynamic way. Stiglitz recently wrote for The Atlantic to expand on his views to be found in the book. Wolves were in the title. Scott LaPierre, in his review posed the comment;
“Is it the way we’ve grown that has gotten us into this mess, or does growth itself have limits in a world with finite resources? Will technological innovation be the driving force, or do we also need new ways of thinking about our consumption?”
Isn’t this the new salvo to which Stieglitz is referring in the war of economists; we have the method and the means, we need only find a new term that is not a trigger for politicians. The Good Society should start being discussed in kindergarten and continue into the realms of all social circles and dinner parties with the whole considered over one’s own. One’s own is also a concept that should be fully understood from kindergarten onwards. Isn’t education a funny thing?
Oh, speaking of such, if you have a few minutes, the recent substack by Heather Cox Richardson gives a good current insight into government involvement in the economy. Her whole raison d’etre is to educate. Or this clip with her and Jeffery Rosen, author on a new book on the pursuit of Happiness, moderated by Ken Burns. We cannot escape looking back to our own history to inform the future options.
https://www.theatlantic.com/ideas/archive/2024/04/neoliberalism-freedom-markets-hayek/678124
The Roosevelt Institute team is committed to building a better future—for all. https://rooseveltinstitute.org/publications/
The Road to Freedom: Economics and the Good Society https://bookshop.org/p/books/the-road-to-freedom-economics-and-the-good-society-joseph-e-stiglitz/20976768?ean=9781324074373
https://hbr.org/2024/03/does-capitalism-need-reform-or-revolution