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Arabica Robusta

UnderstandingSociety: Methodological individualism today - 0 views

understandingsociety.blogspot.com/...gical-individualism-today.html

economic theory neoclassical individualism

shared by Arabica Robusta on 04 Nov 12 - No Cached
  • The elementary unit of social life is the individual human action. To explain social institutions and social change is to show how they arise as the result of the actions and interaction of individuals.
  • It appears to be a version of the physicist’s preference for reduction to ensembles of simple homogeneous "atoms" transported to the social and behavioral sciences. This demand for reduction might take the form of conceptual reduction or compositional reduction. The latter takes the form of demonstrations of how higher level properties are made up of lower level systems. The conceptual reduction program didn't work out well, any more than Carnap's phenomenological physics did.
  • In addition to this bias derived from positivist philosophy of science, there was also a political subtext in some formulations of the theory in the 1950s. Karl Popper and JWN Watkins advocated for MI because they thought this methodology was less conducive to the "collectivist" theories of Marx and the socialists. If collectivities don't exist, then collectivism is foolish.
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  • Another phase of thinking was more ontological than conceptual. These thinkers wanted to make it clear that social things, causes, and structures depended on the activities of individuals and nothing else.
  • There is one aspect of the tradition that I haven't mentioned yet: the idea that we can carve out the individual as separate from and prior to the social -- a view sometimes referred to as "atomistic".
  • In my view, the only claims about methodological individualism that seem unequivocally plausible today are the ontological requirements -- the various formulations of the notion that social things are composed of the actions and thoughts of individuals and nothing else. This implies as well that the supervenience claim and the microfoundations claim are plausible as well.
Arabica Robusta

William Davies - After Neoliberalism - 0 views

www.aeonmagazine.com/...after-neoliberalism

neoliberalism corporate globalization individualism neoclassical

shared by Arabica Robusta on 27 Jul 13 - No Cached
  • Centralised economic planning was at its height thanks to a combination of world war, statist ideologies and the new macroeconomic techniques invented by John Maynard Keynes. It was against this backdrop that a marginalised group of economists and philosophers began the neoliberal fightback. They were inspired and organised by the émigré Austrian intellectual, Friedrich Von Hayek.
  • Markets, from this perspective, are information-processing machines. They are like vast computers, channelling decisions, desires and preferences. They have no ideas of their own about what is worth producing and having: they just process the choices that individuals happen to make. And their capacity to do this is all thanks to the price mechanism.
  • Firstly, individuals, not experts, were the best judges of their own tastes and welfare. Secondly, the price mechanism of the market could be trusted to adjudicate between the various competing ideas, values and preferences that exist in modern societies. The state, by contrast, could not.
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  • As so often happens during times of economic crisis, an entirely new logic is emerging on the back of neoliberalism. At the core of this logic is a new vision of the individual, who is acting partly in a calculating economic fashion, but partly in a social, habitual fashion. When the two come into conflict, as arguably occurred in the financial sector, the results can be disastrous.
  • One of the most striking findings from the new science of well-being (admittedly noticed by Sigmund Freud a century earlier) is that work is an indispensable condition of human happiness.
    • Arabica Robusta
      Arabica Robusta on 27 Jul 13
       
      What is "work"?
  • From this emerging ‘post-neoliberal’ perspective, individual choice and market prices are no longer altogether to be trusted. Especially where physical and mental health are concerned, there is a growing sense that experts need to teach individuals what is good for them in their day-to-day lives.
  • The human mind, with all its self-destructive and herdlike tendencies, is now the territory into which economic policymakers are edging.
  • But it is precisely because of this culture that governments are searching for justifications to set limits, to identify bad choices and promote well-being.
Arabica Robusta

Essays in Monetary Theory and Policy: On the Nature of Money | New Economic Perspectives - 0 views

neweconomicperspectives.org/...heory-policy-nature-money.html

money theory economics

shared by Arabica Robusta on 12 Jan 14 - No Cached
  • Observe that the need for a standardized money of account was not necessary since the redemption of debt between individuals can be determined case by case.  Money of account might be a cattle between Joshua and Henry, and then ten watermelons between Helen and Linda, etc.  However, when there emerges the need to denominate debt obligation between individuals and the “society”/central authority in various forms (such as fines, fees, taxes, etc.), a standard unit of account for money was needed to serve as the standard measure of value. 
  • In his study of colonial Africa, Forstater similarly concludes that by imposing a debt obligation (taxes) on colonial Africans denominated in foreign currency (British Pounds), the British were able to dismantle the pre-existing economic structure in Africa and to monetize its whole economy and population (2005). 
  • While Hudson (2004) in his study of Mesopotamia offers the second explanation of the origin of money that money evolved as a standard accounting unit that keeps track of surplus and inputs of production, the two heterodox explanations need not be mutually exclusive (Tcherneva, 2005).  Henry links both explanations in his study of ancient Egypt.  In essence, Henry argues that: 1) money originated in ancient Egypt from the need of the ruling “engineers” class to establish accounting basis for agricultural products and social surpluses; and 2) money also served as a means of payment to settle debt obligations (fines, fees, foreign tribute, and tribal obligations) to the kings and priests (Henry, 2004).
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  • Since money is a veil that hides the urge to truck and barter, removing it would not affect production except for some efficiency costs due to the “double coincidence of wants” problem.  Therefore, money is a neutral veil that only obscures the market relationships behind it.  Economists thus ought to conduct a “real”, as opposed to “monetary,” analysis.
  • What is important for the paper is that the above analysis shows how intrinsically connected are the ideas of barter, money neutrality, “real” economic analysis, “exogenous money,” inflation, money scarcity, and “loanable funds theory.”  These theoretical tools then allow the orthodox economists to conduct “correct” monetary and fiscal policies.  To recapitulate, monetary policy determines price levels while fiscal policy negatively affects private investment.  Hence, the solution is to target a stable money supply and to run balanced government budget as long as possible.  It is therefore that the myth of barter is crucial in the orthodox theorizing. 
  • First, these research shows that money existed prior to market.  
  • Second, the nature of money is a credit-debt relationship that can only be understood in institutional and social contexts.
  • The liability of the central authority becomes the standard unit of account because the central authority has the sufficient power to impose liabilities on its population in the forms of fines and taxes.  This is the essence of Chartalism, “Modern Money,” “Tax-Driven Money,” and “Money as a Creature of the State” (Lerner 1947, Knapp 1973, Keynes 1930, Goodhart 1998, Wray 2001, Forstater 2006).
  • Third, the role of money was initially an abstract unit of account and means of final payment and later as medium of exchange.  This means that money as unit of account precedes its roles as medium of exchange and store of value. 
  • Therefore, money originated as a byproduct of social relations based on debt and realized its standard form through the need of the central authority, as opposed to private individuals, to establish a standard unit of account to measure debt obligations or production surplus.  Our analysis also implies a hierarchy of money (debt pyramid), with the liability of the state sits on the top and the liability of individuals sits on the bottom (Bell, 2001).  It should be clear that the entire debt pyramid is effectively money/IOUs.
  • In short, the endogenous money approach reverses two causalities proposed by orthodoxy: 1) reserve creates deposits; and 2) deposits create loan.  On the contrary, the endogenous money holds that loans create deposits that then create the need for the central bank to accommodate with reserve.  In other words, banks first make loans, and then seek reserves to meet central bank regulations. 
  • Such debt obligation is ultimately reflected at the central bank’s balance sheet as the private bank enables Henry’s IOUs to be denominated in the state money of account.  Therefore, the central bank is simply a scorekeeper of the economy (Mosler, 2010).  The reserves at the central bank, created by keystrokes, simply serve an accounting purpose for the economy. 
  • It is important to note that bond sales do not finance government spending.  Reserves and bonds are both the liability of the state.  The only difference is that bonds earn interests while reserves do not.  This also means that the myth of the national debt indebting our future generation should be abolished.  Government liabilities, including reserves and government bonds, are effectively private wealth by accounting identity. 
  • But the paper argues that before reaching full employment, it is unlikely that deficit spending would necessarily be inflationary.  In essence, involuntary unemployment indicates a permanent loss in production since the federal government could always have hired the unemployed to achieve public purposes.  Hence, the right to employment ought to become a basic human right guaranteed by any sovereign government.
  • Even with the quantitative easing, the central bank is merely performing asset management as opposed to money creation.  Indeed, the heterodox theory of the nature of money implies that money creation has to be endogenous, which gives support for conducting expansionary fiscal policy till full employment.
Arabica Robusta

Neoliberalism and the revenge of the "social" | openDemocracy - 0 views

www.opendemocracy.net/...ge-of-%E2%80%9Csocial%E2%80%9D

neoliberalism corporate globalization individualism neoclassical

shared by Arabica Robusta on 23 Jul 13 - No Cached
  • This also poses questions about the latest manifestation of ‘neoliberalism’. The fact that it is social media that is facilitating this new form of state power, that it is social networks that are the object of its gaze, may indicate that neoliberal government no longer places quite so much emphasis on the market, as a mechanism for organizing knowledge, regulating freedom and achieving transparency.
    • Arabica Robusta
      Arabica Robusta on 23 Jul 13
       
      Has neoliberal governmentality ever really emphasized the market?  Below the ideological/depoliticized myths, neoliberalism has been about strong government "facilitation" of corporate neo-colonization.
  • States play an important role in making ‘society’ visible and measurable, through collecting and publishing large quantities of statistics. But the claim of social theorists and sociologists in the tradition of Emile Durkheim is that ‘society’ has some reality, over and above the particular statistics through which we come to know it.
  • The social hovers as a paradox, between a space of state coercion governed by law, and a space of market spontaneity governed by individual incentives and price. When acting socially we are both rule-bound and free at the same time. And it was precisely this mysterious and contradictory nature that led pioneering neoliberal thinkers, such as Friedrich Von Hayek, to pour scorn on the very idea. The term ‘social’, he argued, is a “weasel-word par excellence. Nobody knows what it actually means”.
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  • It’s important to stress – as Philip Mirowski does in his new book, Never Let a Serious Crisis Go to Waste – that neoliberals were never hostile to the state, which they understood as a necessary source of coercion, for the purposes of preventing political upheaval.
    • Arabica Robusta
      Arabica Robusta on 23 Jul 13
       
      "Preventing political upheaval."  The mask slips.  States are there to keep the hoi polloi in line while the "technocrats" expertly run the market system.
  • Hayek would be distressed to know that in recent years, there has been an explosion of new types of accounting, governance and policy intervention which come dressed in the rhetoric of the ‘social’. Social enterprise, social media, social indicators, social impact bonds, social neuroscience.
  • I would suggest that, lying between these two interpretations, is a third option: that neoliberalism is being reinvented in ways that incorporate social logic, as a means of resisting critique and delaying crisis.
  • Without other people to guide and support them, provide norms and examples, they start to behave in ways that are self-destructive and destabilizing. This is the central insight of behavioural and happiness economics, which are achieving growing influence in policy-making circles right now.
  • The ‘social’ is brought back in as a way of providing support, such that individuals can continue to live the self-reliant, risk-aware, healthy lifestyles that neoliberalism requires of them.
  • At present, the digital tools used to analyse social life are in their infancy, and are largely attracting interest from marketing firms. But new techno-utopian policy visions, of ‘smart cities’ and digital tracking of health behaviours, look set to make pattern recognition and relationship management a key purpose of government. This represents the coming of what Geoff Mulgan has termed the ‘relational state’, or what I have previously described as ‘neocommunitarianism’
    • Arabica Robusta
      Arabica Robusta on 23 Jul 13
       
      Also known as panoptical surveillance.
  • But this misses the logic of the emerging technical apparatus of government. Where neoliberalism integrates the logic of the social, it is precisely relationships between actors that are being observed and measured, and not the actors themselves. It is in correlations and patterns where value lies in a 21st century Big Data society, and not in the properties or preference of individuals, as was the case in a 20th century statistical and market society. And it is in the identification of hitherto invisible relationships that networked digital media holds out promise for security agencies. There is nothing innocent about meta-data.
  • In an effort to stave off their opponents, political movements can often end up stealing their clothes. Britain’s Labour Party arguably delivered a better version of Thatcherism than the Conservative Party was ever able to.
  • Neoliberalism’s abiding passion was always to destroy socialism, but in practice it may have ended up with far more of the technocratic elements of ‘actually existing’ state socialism than its ideologues could ever imagine (as I discuss here). When one considers our current predicament, in which our social and private lives are subjected to relentless quantification and optimization, the following prediction looks prescient: “the whole of society will have become a single office and a single factory”. This was in fact expressed as an optimistic vision of what a good society might look like in the future. And the visionary was none other than Vladimir Lenin.
Arabica Robusta

David Harvey Reviews Piketty's Capital in the 21st Century - 0 views

davidharvey.org/...afterthoughts-pikettys-capital

neoclassical individualism economic neoliberalism development exploitation industries corporate globalization harvey

shared by Arabica Robusta on 24 May 14 - No Cached
  • He demolishes the widely-held view that free market capitalism spreads the wealth around and that it is the great bulwark for the defense of individual liberties and freedoms. Free-market capitalism, in the absence of any major redistributive interventions on the part of the state, Piketty shows, produces anti-democratic oligarchies.
  • What Piketty does show statistically (and we should be indebted to him and his colleagues for this) is that capital has tended throughout its history to produce ever-greater levels of inequality. This is, for many of us, hardly news. It was, moreover, exactly Marx’s theoretical conclusion in Volume One of his version of Capital. Piketty fails to note this, which is not surprising since he has since claimed, in the face of accusations in the right wing press that he is a Marxist in disguise, not to have read Marx’s Capital.
  • What Piketty does show statistically (and we should be indebted to him and his colleagues for this) is that capital has tended throughout its history to produce ever-greater levels of inequality. This is, for many of us, hardly news. It was, moreover, exactly Marx’s theoretical conclusion in Volume One of his version of Capital. Piketty fails to note this, which is not surprising since he has since claimed, in the face of accusations in the right wing press that he is a Marxist in disguise, not to have read Marx’s Capital.
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  • And he gives a thoughtful defense of inheritance taxes, progressive taxation and a global wealth tax as possible (though almost certainly not politically viable) antidotes to the further concentration of wealth and power.
  • The law is the law and that is that. Marx would obviously have attributed the existence of such a law to the imbalance of power between capital and labor. And that explanation still holds water.
  • As Alan Budd, an economic advisor to Margaret Thatcher confessed in an unguarded moment, anti-inflation policies of the 1980s turned out to be “a very good way to raise unemployment, and raising unemployment was an extremely desirable way of reducing the strength of the working classes…what was engineered there in Marxist terms was a crisis of capitalism which recreated a reserve army of labour and has allowed capitalists to make high profits ever since.”
  • “All told,” he writes, “over the period 1932-1980, nearly half a century, the top federal income tax in the United States averaged 81 percent.” And this did not in any way dampen growth (another piece of Piketty’s evidence that rebuts right wing beliefs).
  • After 1980 top tax rates came down and capital gains – a major source of income for the ultra-wealthy – were taxed at a much lower rate in the US, hugely boosting the flow of wealth to the top one percent. But the impact on growth, Piketty shows, was negligible. So “trickle down” of benefits from the rich to the rest (another right wing favorite belief) does not work. None of this was dictated by any mathematical law. It was all about politics.
  • Piketty’s formulation of the mathematical law disguises more than it reveals about the class politics involved. As Warren Buffett has noted, “sure there is class war, and it is my class, the rich, who are making it and we are winning.” One key measure of their victory is the growing disparities in wealth and income of the top one percent relative to everyone else.
  • The whole of neo-classical economic thought (which is the basis of Piketty’s thinking) is founded on a tautology. The rate of return on capital depends crucially on the rate of growth because capital is valued by way of that which it produces and not by what went into its production. Its value is heavily influenced by speculative conditions and can be seriously warped by the famous “irrational exuberance” that Greenspan spotted as characteristic of stock and housing markets. If we subtract housing and real estate – to say nothing of the value of the art collections of the hedge funders – from the definition of capital (and the rationale for their inclusion is rather weak) then Piketty’s explanation for increasing disparities in wealth and income would fall flat on its face, though his descriptions of the state of past and present inequalities would still stand.
  • Restricting the supply of capital to new investment (a phenomena we are now witnessing) ensures a high rate of return on that capital which is in circulation. The creation of such artificial scarcity is not only what the oil companies do to ensure their high rate of return: it is what all capital does when given the chance. This is what underpins the tendency for the rate of return on capital (no matter how it is defined and measured) to always exceed the rate of growth of income. This is how capital ensures its own reproduction, no matter how uncomfortable the consequences are for the rest of us. And this is how the capitalist class lives
Arabica Robusta

The twilight of neoliberalism: can popular struggles create new worlds from below? | op... - 0 views

www.opendemocracy.net/...struggles-create-new-worlds-fr

neoclassical individualism economic neoliberalism industries exploitation development globalization corporate marxism ecology social movements

shared by Arabica Robusta on 01 Sep 14 - No Cached
  • We Make Our Own History rethinks humanist Marxism as a theory of collective action, including the ways in which social movements from below can develop from localised struggles over individual issues to far-reaching projects for social change (a welfare state, an end to patriarchy, an ecologically sustainable society). It also looks at the history of movements from above – those which can draw on the resources of capital, the state or cultural power to impose themselves.
  • If the ideologists of neoliberalism want to present it as the natural order of humanity, a more sober historical assessment points out that it has lasted about as long as Keynesianism did before it – a few decades – and is just as vulnerable to the collapse of the alliances which sustain it.
  • The Latin American pink tide demonstrated US inability, for the first time in a century or more, to impose its will (in military, foreign policy or economic terms) on its Latin American “backyard”. The planned “long war on terror” is basically over, with the original strategy for a rolling series of attacks on rogue states buried in the sand and political support for US wars collapsing not only among US elites, but also their European and Arab allies under the impact of the anti-war movements of 2003 in particular. This has fed into a broader weakness in relation to control of the strategically crucial Middle East and North African region manifested in the “Arab Spring”, in particular events in Egypt, and subsequent failure to secure support for war in Syria. Meanwhile, the Wikileaks and Snowden affairs have highlighted the legitimacy crisis of the supposedly all-powerful surveillance state.
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  • All of this also dramatises the inability of neoliberal elites to offer any effective leadership, or to manage any strategy more complex than “hold on tight and cross your fingers”. The tentative criticisms of neoliberalism made at the start of the current crisis by isolated elite members have had no real implication beyond the narrowly technical (“quantitative easing”, and so on.) There is no significant dissent within elites – political and financial, or their allies in academia and journalism – about the proposal that the only way forward is more austerity, more neoliberalism, more privatisations.
  • We are increasingly in a zombie-like phase of capitalist development (Peck 2010b), in which elites are incapable of solving contradictions through new hegemonic projects. This signals the onset of the twilight of neoliberalism...
  • Many of these aspects of the crisis are closely associated with popular movements: Latin American struggles, revolts in the Arab world, the anti-war movement, protests against the security state, the global justice and anti-austerity movements, and ecological movements for climate justice. This does not mean, however, that movements will necessarily be the beneficiaries of the crisis: as our historical account shows, it is one thing to make a particular hegemonic alliance politically unsustainable but another thing altogether to be able to create a new alliance capable of charting a new direction.
  • These processes of external struggle, internal learning and alliance-building are what matter most, and there is no short-cut (in universities, parties or shouting at the computer screen) that can usefully avoid them.
  • any attempt to shortcircuit the slow development of popular agency, whether through opinion politics or intellectual critique which discuss structures in isolation from the kinds of agency which sustain them – and the kinds of agency needed to overcome them – is doomed to failure. The most effective orientation for change is one which starts from dialogue with practically situated struggles – those that people have to engage in to sustain their lives – and supports their extension in alliances across space but also across the social world, into far-reaching projects for change which are grounded in a wide range of different situations.
Arabica Robusta

Neoliberalism has hijacked our vocabulary | Doreen Massey | Comment is free | guardian.... - 0 views

www.guardian.co.uk/...liberalism-hijacked-vocabulary

industries individualism extractive exploitation economic development neoclassical massey geography consumerism

shared by Arabica Robusta on 11 Jun 13 - No Cached
  • The message underlying this use of the term customer for so many different kinds of human activity is that in all almost all our daily activities we are operating as consumers in a market – and this truth has been brought in not by chance but through managerial instruction and the thoroughgoing renaming of institutional practices. The mandatory exercise of "free choice" – of a GP, of a hospital, of schools for one's children – then becomes also a lesson in social identity, affirming on each occasion our consumer identity.
  • Another word that reinforces neoliberal common sense is "growth", currently deemed to be the entire aim of our economy.
  • Instead of an unrelenting quest for growth, might we not ask the question, in the end: "What is an economy for?", "What do we want it to provide?"
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  • Where only transactions for money are recognised as belonging to "the economy", the vast amount of unpaid labour – as conducted for instance in families and local areas – goes uncounted and unvalued. We need to question that familiar categorisation of the economy as a space into which people enter in order to reluctantly undertake unwelcome and unpleasing "work", in return for material rewards which they can use for consuming.
  • Above all, we need to bring economic vocabulary back into political contention, and to question the very way we think about the economy in the first place. For something new to be imagined, let alone to be born, our current economic "common sense" needs to be challenged root and branch.
Arabica Robusta

The Lost Science of Classical Political Economy | New Economic Perspectives - 0 views

neweconomicperspectives.org/...ce-of-classical-political.html

neoclassical individualism exploitation industries economic development michael hudson

shared by Arabica Robusta on 29 Jun 13 - No Cached
  • The problem with this reactionary stance is that attempts to base economics on the “real” economy focusing on technology and universals are so materialistic as to be non-historical and lacking in the political element of property and finance.
  • A “real” economic analysis focusing on their common denominators would miss the distinct ways in which each accumulated wealth in the hands of (or under the management of) a ruling elite different modes of property and finance, and hence with what the classical economists came to classify as “unearned income.”
  • For classical and Progressive Era economists, the word “reform” meant taxing economic rent or minimizing it. Today it means giving away public enterprise to kleptocrats and political insiders, or simply for indebted governments to conduct a pre-bankruptcy sale of the public domain to buyers (who in turn buy on credit, subtracting their interest payments from their taxable income).
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  • The problem is not mathematics as such, but the junk economics and junk statistics used by the mathematicians who have captured the discipline of economics. For contrast, one need only turn to the 19th century’s rich toolbox of economic concepts developed to analyze today’s most pressing problems.
  • The overburden of public debt prompted Adam Smith to comment that year that no government ever had repaid its debts, and to propose means to keep it in check by freeing the American colonies that were a major source of conflict with France, for instance, and most of all, by paying for wars out of current taxation so that populations would feel their immediate cost rather than running into debt to international bankers such as the Dutch.
  • The early 19th-century French reformer St. Simon proposed that banks shift from making straight interest-bearing loans to “equity” loans, taking payment in dividends rather than stipulated interest charges so that debt service would be kept within the means to pay. (Islamic law already had banned interest.) This became the inspiration for the industrial banking policies developed in continental Europe later in the century. St. Simon influenced Marx, whose manuscript notes for what became Vol. III of Capital and Theories of Surplus Value collected what he read from Martin Luther to Richard Price on how debts multiplied by purely mathematical laws independently of the “real” economy¹s ability to produce a surplus. The classical concept of productive credit was to provide borrowers with the means to pay. Unproductive debts had to be paid out of revenue obtained elsewhere.
  • Interest paid by consumers was treated as a psychological choice, while industrial profit was treated as a return for the widening time it presumably took to produce capital-intensive goods and services. The ideas of “time preference” and the “roundabout” cycle of production were substituted for the simpler idea of charging a price for credit without any out-of-pocket cost or real risk undertaken by bankers. The world in which economic theorists operated was becoming increasingly speculative and hypothetical.
  • After the Napoleonic wars ended in 1815, Britain’s leading bank spokesman, David Ricardo, applied the concept of economic rent to the land in the process of arguing against the agricultural tariffs (the protectionist Corn Laws) in his 1817 Principles of Political Economy and Taxation. His treatment deftly sidestepped what had been the “original” discussion of rentier income squeezed out by the financial sector.
Arabica Robusta

Financialisation, politics & the future of socialism: A conversation in Seattle with Ca... - 0 views

yanisvaroufakis.eu/...-in-seattle-with-casey-jaywork

neoclassical economic neoliberalism individualism capitalism social democracy diem25 varoufakis

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  • What’s that new paradigm? We can’t go back to old-style communism–for instance, Stalinism. Absolutely not. I would be the first one to object…Let me put it very succinctly to you: I would be in the gulag under that regime. People like me would be in the gulag and people like Hillary Clinton would be in the Politburo.
Arabica Robusta

Britain's Brezhnev-style capitalism | openDemocracy - 0 views

www.opendemocracy.net/...ains-brezhnev-style-capitalism

neoliberalism corporate globalization individualism neoclassical

shared by Arabica Robusta on 23 Jul 13 - No Cached
  • Wandering around Stratford Westfield the other day, I had a similar but more pessimistic thought: maybe capitalism is gradually morphing into the 'actually existing' state socialism of the old Eastern Bloc.
  • Yet Suzi reported that, while Westfield Stratford had duly delivered its promised 8,000 jobs, Peckham Rye Lane's local market was already a source of 13,000, via a far greater number of businesses. This is aside from the webs of social networks that accompany an 'embedded' market economy, in contrast to identikit businesses that are taking over most highstreets. The notion that in an age of shrinking social security, policy-makers might view such a street as anything other than an irreplaceable socio-economic benefit is just bizarre. Why such government suspicion of the market?
  • My feeling is (and I discuss this in a book I'm just finishing) that neoliberalism has entered a post-critical, repetitive phase, in which certain things have to be spoken - delivery, efficiency, security, competitiveness - but in order to hold the edifice together, rather than to reveal anything as objectively 'delivered', 'efficient', 'secure' or 'competitive. Political systems which do not create space for critique encounter this need for mandatory repetition immediately, as occurred to state socialism.
Arabica Robusta

The slow death of neoliberalism - 0 views

www.newstatesman.com/...slow-death-neoliberalism

neoliberalism corporate globalization individualism neoclassical

shared by Arabica Robusta on 24 Jul 13 - No Cached
  • Although the purity of Hayek’s vision was inevitably polluted by the messy reality of politics, the new era ushered in by Margaret Thatcher and Ronald Reagan treated free markets, governed by the magic of price, as the basis for the moral and economic logic of state and society
Arabica Robusta

The neo-liberal knowledge regime, inequality and social critique | openDemocracy - 0 views

www.opendemocracy.net/...inequality-and-social-critique

neoliberalism corporate globalization individualism neoclassical

shared by Arabica Robusta on 27 Jul 13 - No Cached
  • In common with many other countries, higher education in the UK has been subject to various measures designed to increase transparency and replace collegial decision-making with managerial hierarchies and market-based performance indicators.
  • The knowledge economy was regarded as important, but it was embedded within the wider idea of a knowledge society.
  • For-profit providers have no obligations other than the satisfaction of consumers and the creation of profit for their shareholders. Indeed, they are likely to be further advantaged by new policies for open access to academic publications.
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  • Many academics support open access as the creation of a commons, but it is to be a commons open to private appropriation. The costs of investment in library and other curriculum resources are immediately reduced for new entrants. The playing field, then, is not levelled, but is heavily tilted towards for-profit providers.
  • But here we confront a paradox. Where the argument about students involves the notion that there should not be a direct public subsidy of a private beneficiary, the situation with regard to the impact agenda is reversed. Here it seems that the Government’s view is that there should not be public funding, unless there is a private beneficiary and that beneficiary should not pay.
  • It is publicly-funded ‘blue-skies’ research that has generated the innovations that have been most significant for subsequent product developments. It is the public (through funding) which bears the risk while private interests accrue the rewards. However, the effectiveness of blue-skies research is put under pressure by attempts to shorten the product cycle.
  • Of course, subsumption to the market requires a strong state and this provides a role for knowledge, but it is a knowledge of a very specific kind. Since neo-liberal public reason is based upon a ‘fiction’ of market rationality, various kinds of social actions (especially, collective ones and those based upon weakness of will) appear as distortions that are the obstacle to the rational dispositions that markets facilitate. Thus, the social as ‘residuum’ becomes the object of various kinds of behavioural, ‘anti-social’, sciences (primarily organized through a combination of economics, psychology and cognitive neuro-science), in contrast to the ‘structural’ social sciences.
Arabica Robusta

The Man Who Won a Nobel Prize for Helping Create a Global Financial Crisis » ... - 0 views

triplecrisis.com/eate-a-global-financial-crisis

neoclassical individualism economic exploitation industries neoliberalism corporate development globalization extractive

shared by Arabica Robusta on 26 Oct 13 - No Cached
  • Eugene Fama just received a Nobel Prize for his contributions to the theory of “efficient financial markets,” the dominant theory in financial economics that asserts that markets work ideally if not constrained by government regulation.
  • Both the EMH and OPT are built on crudely unrealistic assumptions that would lead anyone not indoctrinated in a mainstream PhD program to conclude that efficient financial market theory is a fairly-tale rather than serious social science.
  • it is logically impossible for anyone to know this information because the future is not yet determined in the present; the future is uncertain. Nevertheless, defenders of efficiency adopted the “rational expectations” hypothesis, perhaps the most ludicrous assumption in the history of social science, which asserts that all investors know the correct probability distributions of all future security cash flows and believe that they will not change over time.
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  • Friedman’s positivism states that the realism of assumptions does not matter: it has no relation whatever to the acceptability of a theory or its derived hypotheses. As Friedman put it, “[T]ruly important and significant hypotheses will be found to have assumptions that are wildly inaccurate descriptive representations of reality.” The only acceptable test of a theory “is comparison of its predictions with experience.” There are at least three serious problems with this method. First, if patently false assumptions are adopted, as in efficient financial market theory, and impeccable logic is used to deduce hypotheses from them, they cannot—as a matter of logic—be accurate reflections of reality. Fairy-tale assumptions can only generate fairy-tale hypotheses.
  • virtually any hypothesis can be shown to be statistically significant if enough different regressions are run.
  • The tenets of positivism require that the CAPM should be rejected. However, financial economists kept mining the data in an endless effort to find econometric results that fit the theory. Meanwhile, CAPM sustained its canonical status and efficient market theory remained unscarred in spite of its lack of empirical support.
  • The answer is that the economics profession is committed ideologically to a defense of the proposition that financial markets are efficient, yet it is impossible to derive this proposition from a realistic assumption set.
  • Positivism is the magic that makes it possible to construct a “scientific” defense of the proposition that free-market capitalism has no serious flaws and dangers.
Arabica Robusta

Economics is too important to leave to the experts | Ha-Joon Chang | Comment is free | ... - 0 views

www.theguardian.com/...economics-experts-economists

neoclassical individualism economic neoliberalism development exploitation industries corporate globalization extractive

shared by Arabica Robusta on 14 May 14 - No Cached
  • How has this mess been created? The mismanagement of the crisis by the coalition government means it has to bear significant blame, but the main cause lies in the nature of the economic model that the UK has pursued for three decades.
  • However, the underlying economic model remained intact; the New Labour thinking was that we should let the City maximise its profits by minimising regulation, and then help the poor with the taxes on those profits. There was no realisation that the financial system itself may be a problem.
  • Of course, all of these policies are supposed to have been backed up by scientifically proved economic theories – saying that markets are best left alone, that making the rich richer makes everyone richer, that welfare spending and protection of worker rights only make people lazy and dependent, and so on. Most people have accepted these theories without much questioning because they are based on "expert" advice.However, all these economic theories are at least debatable and often highly questionable. Contrary to what professional economists will typically tell you, economics is not a science. All economic theories have underlying political and ethical assumptions, which make it impossible to prove them right or wrong in the way we can with theories in physics or chemistry. This is why there are a dozen or so schools in economics, with their respective strengths and weaknesses, with three varieties for free-market economics alone – classical, neoclassical, and the Austrian
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  • Very often, the judgments by ordinary citizens may be better than those by professional economists, being more rooted in reality and less narrowly focused.Indeed, willingness to challenge professional economists and other experts is a foundation stone of democracy. If all we have to do is to listen to the experts, what is the point of having democracy?
Arabica Robusta

How economic growth has become anti-life | Vandana Shiva | Comment is free | theguardia... - 0 views

www.theguardian.com/...ic-growth-has-become-anti-life

neoclassical individualism economic exploitation industries neoliberalism corporate development globalization agriculture vandana shiva

shared by Arabica Robusta on 02 Nov 13 - No Cached
  • The concept of growth was put forward as a measure to mobilise resources during the second world war.
  • In effect , “growth” measures the conversion of nature into cash, and commons into commodities. 
  • In the same vein, evolution has gifted us the seed. Farmers have selected, bred, and diversified it – it is the basis of food production. A seed that renews itself and multiplies produces seeds for the next season, as well as food. However, farmer-bred and farmer-saved seeds are not seen as contributing to growth. It creates and renews life, but it doesn't lead to profits. Growth begins when seeds are modified, patented and genetically locked, leading to farmers being forced to buy more every season.
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  • Both ecology and economics have emerged from the same roots – "oikos", the Greek word for household. As long as economics was focused on the household, it recognised and respected its basis in natural resources and the limits of ecological renewal. It was focused on providing for basic human needs within these limits. Economics as based on the household was also women-centered. Today, economics is separated from and opposed to both ecological processes and basic needs. While the destruction of nature has been justified on grounds of creating growth, poverty and dispossession has increased. While being non-sustainable, it is also economically unjust.
  • Meanwhile, the demands of the current model of the economy are leading to resource wars oil wars, water wars, food wars. There are three levels of violence involved in non-sustainable development. The first is the violence against the earth, which is expressed as the ecological crisis. The second is the violence against people, which is expressed as poverty, destitution and displacement. The third is the violence of war and conflict, as the powerful reach for the resources that lie in other communities and countries for their limitless appetites.
  • Nobel-prize winning economists Joseph Stiglitz and Amartya Sen have admitted that GDP does not capture the human condition and urged the creation of different tools to gauge the wellbeing of nations.
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