In this photo taken on Monday Feb. 17, 2014, an anti-austerity work of street art featuring the Dalton Brothers from the Belgian comic ‘Lucky Luke’ is seen in the Exarchia area of central Athens. Greece’s grueling financial crisis and the harsh terms of an international bailout have inspired multiple works of graffiti around Athens.
Special mention
Justin Wolfers has assembled some serious information. But, in my view, he has offered a less-than-serious explanation of that information.
The information is pretty straightforward: references to economists in the New York Times have grown over time and far outnumber mentions of members of other academic disciplines, including historians, psychologists, sociologists, anthropologists, and demographers. (The same is true, as it turns out, of the number of mentions in the Congressional Record.)
I have no reason to dispute the numbers. And they make sense to me—from my own reading of the Times over many decades and the fact that, “if you are running a government agency, a think tank, a media outlet or a major corporation, and don’t have your own pet economist on the payroll, you’re the exception” (to which I would only add, major university).
Wolfers’s explanation is, however, much less serious:
This economist is drawn to conclude that if our relative success is not due to supply, then it must be demand, which means that our popularity reflects the discerning tastes of our audience in the marketplace of ideas.
What I think we need to grapple with is the economizing tendency of bourgeois society. What I mean by that is the idea that, within contemporary society, all major individual and social questions are increasingly subject to an economic logic. Should I stay in school? What kind of job should I look for? How do we organize our households? Can we eliminate poverty? Should we lower the retirement age and expand Social Security benefits? And so on and so forth.
Given the way our society is currently organized, the answers to those questions are generally viewed through an economic lens and couched in an economic language. It’s a lens and language (borrowed mostly from mainstream economics) of incentives, tradeoffs, scarcity, costs and benefits, equilibrium, and so on. It’s a discourse according to which a system based on individual decisions, private property, and markets is considered sacrosanct. And it’s a project that seeks to economize—to subject to an economic calculation—all major individual and social issues.
If that’s true, is it any wonder that economists find themselves at the top of the heap?
Naomi Klein, in her book The Shock Doctrine, made us all aware of disaster capitalism—”the rapid-fire corporate reengineering of societies still reeling from shock”—which has occurred across the world, from Pinochet’s Chile to post-Katrina New Orleans.
But what about examples of people creating practices and institutions other than capitalism in societies that are reeling from shock, what we might call disaster noncapitalism?
We certainly saw many examples during the First Great Depression in the United States, of which King Vidor’s long-overlooked film is the best cinematic account.
More recently, beginning in 2000, Argentine workers recuperated more than 180 enterprises, thus creating thousands of jobs, forming a broad network of mutual support among the worker-run workplaces, and generating many community projects.
And now, of course, we have Greece’s solidarity movement, which unfortunately has received much less attention in the run-up to Sunday’s election than the fears stoked by those who want us to believe continued austerity is the only option.
Yes, Greece is a dramatic example of at least some aspects of disaster capitalism, the way a country can be pummeled into submission in order to maintain the privileges of a tiny minority at home and abroad. But it’s also an example of its opposite—of how people are willing to band together, in the worst of circumstances (with soaring unemployment, declining wages, and Draconian cuts to government services), to invent new kinds of economic institutions.
The Peristeri health centre is one of 40 that have sprung up around Greece since the end of mass anti-austerity protests in 2011. Using donated drugs – state medicine reimbursements have been slashed by half, so even patients with insurance are now paying 70% more for their drugs – and medical equipment (Peristeri’s ultrasound scanner came from a German aid group, its children’s vaccines from France), the 16 clinics in the Greater Athens area alone treat more than 30,000 patients a month.
The clinics in turn are part of a far larger and avowedly political movement of well over 400 citizen-run groups – food solidarity centres, social kitchens, cooperatives, “without middlemen” distribution networks for fresh produce, legal aid hubs, education classes – that has emerged in response to the near-collapse of Greece’s welfare state, and has more than doubled in size in the past three years.
“Because in the end, you know,” said Christos Giovanopoulos in the scruffy, poster-strewn seventh-floor central Athens offices of Solidarity for All, which provides logistical and administrative support to the movement, “politics comes down to individual people’s stories. Does this family have enough to eat? Has this child got the right book he needs for school? Are this couple about to be evicted?”
As well as helping people in difficulty, Giovanopoulos said, Greece’s solidarity movement was fostering “almost a different sense of what politics should be – a politics from the bottom up, that starts with real people’s needs. It’s a practical critique of the empty, top-down, representational politics our traditional parties practise. It’s kind of a whole new model, actually. And it’s working.”
The many successes of disaster noncapitalism in Greece are one of the reasons Syriza has a good chance of winning tomorrow’s election.
Special mention
Will market forces solve the problem of stagnant wages and growing inequality?
Mark Thoma says no.
The idea that an improving economy will overcome the problem of stagnating real wages and rising inequality that has existed for decades is suspect. Why should this time be any different from the past? Sure, improvements in labor demand relative to supply could make some difference, and a tight labor market is certainly better for the working class than a labor market will high levels of unemployment and a large number of discouraged workers, but should we suddenly expect workers to receive a higher share of national income – income that has increasingly flowed to those at the very top of the income distribution – once we reach full employment?
The data in the chart above appear to confirm Thoma’s review. Yes, there are moments (such as in 1969 and 2000) when a low unemployment rate gave a boost—however temporary—to the share of national income going to labor. However, as a general trend, the wage share has been falling from 1970 onward (from 51.5 percent then to less than 42 percent today) across many periods of both high and low unemployment.
Today, even as the official unemployment rate continues to decrease, the falling wage share—and, with it, an increasingly unequal distribution of income—shows no sign of abating.
Hence Thoma’s reasonable conclusion:
So long as we continue to believe that market forces and the attainment of full employment will solve the problem of stagnating wages and rising inequality. . .inequality will continue to be a problem.
Special mention
