Monday, 17 January 2022

Iyer on inequality

In an equal society, both life-chances and reproductive outcomes are almost equal save for a small random variable. Clearly, the fact that most male lineages have gone extinct as have, to a lesser extent, female lineages associated with low economic gender dimorphism or division of labor and gains from trade, shows that material equality in early societies was associated with radically different reproductive outcomes. Conversely, social stratification of an extreme kind permitted hierarchically lower lineages to maintain, or even increase, their share of the total population. In other words, accepting inequality has always been an evolutionarily stable strategy for the vast majority of lineages. The alternative to ‘apartheid’ genetic diversity (which it is regret minimizing to conserve) is egalitarian demographic replacement. True, the maths involved in showing this is quite recent but this unthought known has been around since the beginning of time. Humans domesticated themselves to inequality to gain the same benefit that domesticated animals did. Hegel’s ‘master-slave’ dialectic should be recast as a case of Slaves out-reproducing the Herrenvolk. Egalitarian regimes- and Hitler’s was one such in that a Corporal supplanted a General- soon turn genocidal. The Mayflower passengers initially established an egalitarian society and only gave up on that type of foolishness when they began to starve. Indeed, the highly inegalitarian American, or Australian, rapidly displaced indigenous peoples. Native Americans constitute 1.7 per cent of the population. African-Americans are 13 percent. Slavery, it seems, was better than Freedom in the only sense that matters to Biology.

Sedentary populations have often been invaded by more egalitarian tribes. France is named for the Francs, Lombardy for the Lomabards, England for the Angles and so forth. An egalitarian ethic can transform internal economic competition into a drive to conquer and establish dominance of an uncompromising, utterly amoral, kind. However, unless this translates into increased specialization and division of labor- i.e. more social stratification and inequality of outcome- such dominance is fleeting. 

This is not to say, that we should meekly put up with extreme concentrations of wealth and power. Rather, by studying philosophy or anthropology or literary theory, we should write articles or blogposts while quietly murmuring ‘boo to the rich’ as we go about our mundane tasks as metaphorical catamites of the plutocracy. 

V.D Choothapadhyaya’s classic study of the indigenous tribes of West Hampstead has influenced a generation of imaginary scholars whose work is unfairly neglected by a Eurocentric Academia. To recover the voice of the subaltern we must first, as Gayatri Spivak says, problematize the catachresis of imbrication involved in listening for its echoes in her next book. This does not mean we can put off urgent ‘bottom-up’ reform- e.g defunding the police so narco-gangs can take over. More importantly, we must address issues of gender and identity without giving way to either a doctrinaire insistence that everything is socially constructed because this generates an essentializing biological backlash which is already contributing to an upsurge in recreational incontinence which has overflowed the Academy.

As Prof. Sterelny points out, intimacy and trust among foragers can keep ‘alphas’ in check. I have often spoken of this to foragers who however get angry and say they are actually Actuaries or Accountants and that they won’t French kiss each other so as to establish intimacy because this will do nothing to check the declining alphas of their stock portfolios. This just shows the level of ignorance that prevails in the so called 'City' of London. This is not to let the intelligentsia off the hook. If our Societies are unequal, it is because our Epistemic system is concerned with not a level playing field of Knowledge but  siloed hierarchies of Credentialism. Also anyone teaching a non-STEM subject is as stupid as shit. 

Priyamvada Gopal wrong on Fredrick Douglass

Priyamvada Gopal in her latest book writes of a famous speech by Fredrick Douglass- 

On 4 August 1857, some three months after the commencement of the insurgency in India, though it is unlikely he was aware of it at the time,

Why? The NYT had begun writing about it a month previously. Douglass was trying to show, firstly, that Britain was on the abolitionist side and, secondly, African Americans were sensible and law-abiding and thus a potential source of national strength. Sadly, the British victory was seen as a sign of hope for the Southern States. Europeans were so inherently superior to Blacks that they could easily put down a slave report even if the slaves were the majority. 

the former slave and American abolitionist Frederick Douglass

who ran a newspaper and thus read all the newspapers and other dispatches available 

gave a speech in Rochester, in New York, felicitating a different revolutionary moment. Nearly 25 years before, in ‘one complete transaction of vast and sublime significance’, slaves in the British West Indies had finally been deemed human beings, restored to their rightful stature as free men and women. Three decades after the 1807 abolition of the British slave trade, often confused with the Slavery Abolition Act of 1833, Britain’s human chattel on the vast sugar and cotton plantations of the West Indies had officially ceased to be slaves, though they would remain compulsorily apprenticed to their owners for another five years. In the United States, however, slavery still flourished – as indeed it did in other parts of the world such as Brazil, where it carried on to the end of that century. Douglass was speaking to fellow abolitionists, gathered in Rochester to commemorate the West India emancipation, and he took pains to contrast Britain’s significant achievement with the ‘devilish brutality’ he saw around him in a formally democratic and republican land. The act of abolition, deriving though it did from ‘the moral sky of Britain’, had universal ramifications since, Douglass insisted, it ‘belongs not exclusively to England and English people, but to lovers of Liberty and mankind everywhere.’

Why is Gopal mentioning this? The fact is, all the Northern States had abolished or were abolishing slavery by 1804. But Canada, which remained under the British Crown, had also done so in 1793 as Douglass's ally or rival, Garrison who was from Canada, well knew . The reason Douglass was talking about abolition in the West Indies was  because

1) It was resisted by the local elite

2) It was financed by the metropole and turned out to be profitable for those local elites. Moreover, the emancipated Jamaicans etc. proved industrious and peaceful. 

In other words, Douglass was pointing to a peaceful, 'capitalist', way forward which would benefit his enslaved brethren while also releasing financial capital from Southern plantations and making it available for industrial expansion. 

Since Gopal is a stupid racist, she thinks Douglass was ignorant- he couldn't even read the Newspaper- and that stuff that happened in the British Empire mattered to him. The truth is quite different. Douglass was smart not despite his being Black but because he was Black and truly representative of the enslaved community. Gopal may not believe this because she is a bigot, but such is in fact the case. 

Consider the following-

Douglass’s speech paid due homage to the august ranks of British abolitionists. For those who had claimed that only Englishmen could ‘properly celebrate’ the West Indian Emancipation, he had a message: in that case all those who love freedom can ‘claim to be Englishmen, Englishmen in the love of Justice and Liberty, Englishmen in magnanimous efforts to protect the weak against the strong and the slave against the slaveholder’.

Douglass had lived in England for two years in the 1840s. He had met some of the old abolitionists. Indeed, the English took up a subscription so that his freedom could be purchased from what remained his legal master. All this was well known to Douglass's audience. What he is hinting at here is

1) the possibility of an alliance with Britain (in the context of the Crimean War and a possible revolt in India and elsewhere). This also had to do with some Southern States- e.g. Louisiana- which wanted to annex Cuba, even going it alone to do so, in defiance of Britain and France

2) British capital helping finance emancipation in return for infrastructure and other investment in cotton and other primary products needful for both the North as well as Britain itself. 

Douglass knew that the Brits hadn't abolished slavery in India. He also knew that there was no prospect of the North allying with a rival industrial power. However, he was in a subtle and nuanced manner creating room for maneuver such that the argument that Britain would side with the South in a Civil War was combatted. No doubt, the Southern gentleman claimed to be in the mold of the English squire or Cavalier; but the North might with greater plausibility claim a kinship with what was after all the leading industrial and financial power of the time.  

Thereafter, however, his speech took a curious turn. Douglass had also to counter the charge, made by some of his fellow American blacks, that to commemorate the West Indian Emancipation was to celebrate the achievements of others, specifically the deeds of white people, ‘a race by which we are despised’.

Douglass was castigated for his policy of dialogue even with slave-owners. However, African Americans understood that their autonomy increased if they were not wholly reliant on a bunch of White ranters or religious nutcases. 

In a two-pronged response, Douglass noted that, while in the North American struggle against slavery, ‘we, the coloured people’, had not yet played a significant role, this was not the case with Emancipation in the British West Indies. To the extent that they had been able to, the ‘rebellious chattel’ in Britain’s Caribbean colonies had strenuously resisted their oppression, and so ‘a share of the credit of the result falls justly to the slaves themselves’.

There had been slave rebellions which required the intervention of Imperial forces. The problem was that the American South could suppress any such revolt on their own. 

It is this insight that then leads Douglass to make his famous pronouncement: ‘The whole history of the progress of human liberty shows that all concessions yet made to her august claims, have been born of earnest struggle

Who didn't know this? Americans? Had they really forgotten their Revolutionary War? On the other hand, 'earnest struggle' was what had fucked up the less technologically advanced polities and what would fuck them up even more as the technological gap increased.  

… Power concedes nothing without a demand. It never did and never will.’ With an irony he was probably unaware of at the time – news of the Indian ‘Mutiny’ was only slowly making its way to and around Europe and America

Why couldn't this cretin just Google- 'first American newspaper report of Indian Mutiny'- before writing this stupid shit? She would immediately have seen that Douglass had already been apprised of the facts for a month before he made this speech.  

– Douglass quietly observed that some white abolitionists actively discouraged black initiative, expecting black abolitionists to ‘fight like the Sepoys of India, under white officers’.

Gopal may be too ignorant to know that more 'sepoys' fought for the Brits during the Mutiny, then against them. What Douglass is saying is clear. Even if some White ranters think that Blacks will provide cannon fodder for their cause- and even if they get some seemingly obedient 'Sepoys'- still those Sepoys might mutiny if it were in their interest to do so. Essentially, Douglass is hinting that emancipated Blacks would not automatically be part of any existing political camp. In other words, there could be broad, non partisan, support for this cause. 

This, Douglass says, must not deter him and others who would struggle for their own freedom; it is ‘no part of gratitude to allow our white friends to do all the work, while we merely hold their coats’. As he was speaking, of course, the ‘sepoys’ had, in fact, risen against their white officers in a bloody insurgency

of which he and his audience were fully aware because they read the newspapers 

that would alter the shape of the British Empire for good, ending the rule of the marauding East India Company in the subcontinent as the Crown took over full governance of British India.

 In other words, the fiction of Mughal rule was dispensed with. Why does Gopal think this was an improvement? 

Well over the century and a half since Douglass gave that speech, the notion that freedom from both slavery and imperial rule emerged thanks to the benevolence of the rulers continues to exercise a tenacious hold within certain influential strands of British imperial history and in the popular imagination.

No it doesn't. This is a convenient strawman for Gopal. However, the fact remains that some victories over slavery or foreign rule were conceded without much of a fight because a military solution could not pay for itself. But we can see that sort of thing happening in Afghanistan and Iraq and so forth.  

Both abolition and decolonisation – twin outcomes of Britain’s expansionary colonial project over three centuries – are all too frequently regarded as deriving chiefly from the campaigning consciences of white British reformers or as the logical outcome of the liberal and liberalising project that empire ostensibly always was, conquering in order to free.

Gopal may be correct about certain worthless University Departments which should be defunded or abolished. On the other hand, if we accept her argument, the corollary would be that we should ignore virtue signalers and 'progressive' intellectuals because they achieved nothing in the past and will achieve nothing in the future. They are a nuisance simply.  

Despite an abundance of histories of resistance, and not only from a nationalist perspective, which make clear the constitutive role of resistance to the imperial project, ‘imperial initiative’ – colonies ‘given’ their freedom when they were deemed ready for it – as the motive force of decolonisation remains stubbornly entrenched in much political and public discourse in Britain.

Why? Because it was true. Unlike France or Holland, the Brits didn't quit only after a long, expensive, and ultimately doomed attempt to crush the Nationalists. This turned out to be a very profitable strategy.  

Where, for Douglass, the story of Emancipation specifically, and freedom more generally, was one of universal aspiration and shared struggles,

but Douglass was a pragmatist who ditched the Feminists when so as to get the vote for Black men because the Nation was not ready for female suffrage.  

in its most influential and popular versions it continues to be figured as a capacious British, or now Anglo-American, franchise generously extended to peoples across the globe.

What it certainly wasn't was the product of the nuisance created by bullshitting ranters like Gopal.

Edward Said observed correctly that ‘a standard imperialist misrepresentation has it that exclusively Western ideas of freedom led the fight against colonial rule, which mischievously overlooks the reserves in Indian and Arab culture that always resisted imperialism, and claims the fight against imperialism as one of imperialism’s major triumphs’.

Said was an American citizen coz his daddy joined the American Expeditionary Force at a time when America was far more racist than any country it was fighting. There were no 'reserves' of 'Arab culture' in his own Eurocentric shite. The fucker thought the Zahirites were onto a good thing. Why not Salafis or Boko Haramis who would slit his own Protestant throat? 

Writing in the 1930s, G.M. Trevelyan, Regius professor of history at Cambridge, understood such extensions to be ‘pre-eminently a result of our free institutions, our freedom of speech and association, and all that habit of voluntaryism and private initiative’.

So, Gopal's magpie mind links Said to Trevelyan. The odd thing here is that Otto Trevelyan had written a famous book back in the 1860's showing that 'Anglo-Saxon' carpet-baggers were 'marauding' all over Post-Mutiny Bihar.  

Today, where imperial initiative is not actively given the credit for decolonisation, we are offered the claim, here articulated by David Cannadine, that the Empire ‘was given away in a fit of collective indifference’.

Cannadine, unlike Gopal, knows a lot about Britain and its history. Facts are facts. The Dutch and the French sent troops to fight in Indonesia and Vietnam. The Brits couldn't get their men out fast enough from India. Why? The Brits were indifferent to India's fate. They were welcome to starve or slaughter each other under leaders of their own. There is a story about Enoch Powell telling R.A Butler that he just needed a couple of Gurkha regiments to reconquer India. Butler thought the fellow mad- which of course he was.  

John Darwin, meanwhile, paraphrases that school of thought in terms of the notion that ‘the British colonial empire was liberated more by the indifference of its masters than the struggle of its subjects’.

Perfectly fair. Churchill, it is true, wasn't quite sane about India but he preferred to take a shilling off Income Tax rather than spend it on the Navy- thus safeguarding the Empire. What changed during the Second World War was Netaji Bose's ability to get Indian soldiers to change their loyalty. The Naval Ratings mutiny was the final nail in the coffin. The fact is, the British tax-payer- unlike the Dutch or French tax-payer- wasn't prepared to spend a penny on keeping India. That's what 'indifference' means. 

This does not mean that the 'struggle' of 'subjects' didn't matter. However, the Empire only existed because those subjects were mainly interested in struggling against each other thus requiring a British Umpire to maintain Pax Britannica. 

In either event, the ‘granting’ or ‘giving’ of independence to British colonies once they were deemed ‘ready’ for it, remains a cause for national self-congratulation;

Nations should congratulate themselves. It is foolish to say 'As a Nation we have a habit of eating our own shit.'  

it fits neatly into an equally familiar establishment mythology about ‘English capacities to reform without violence or rejecting valuable past practice’.

This mythology is useful to us Brits. Gopal may think we should have an alternative mythology in which Nelson was constantly sticking his hands into the seat of his pants and pulling out handfuls of his own feces which he proceeded to eat at Trafalgar. But Gopal isn't British- unless she has become a naturalized subject of the Crown since moving here.  

Like all mythologies, this too relies on the selective elision of key strands in the story.

But Gopal is incapable of understanding those 'key strands'. She has read the same speech of Fredric Douglass that we all did. But she jumped to the wrong conclusion- viz. that Douglass didn't know about the Siege of Kanpur though American newspapers (he himself edited one such) carried the news about a month before he gave this speech- and then went on to write ignorant nonsense in a manner that disgraces the Academy. 

Friday, 14 January 2022

Tim Bergin babbling on Aeon

Why did changes in the legal minimum wage scarcely impact employment in the US but have a significant impact in France? The answer, for anyone who knows anything about either country is that the French changes were not cosmetic and were in fact genuine real wage increases. In the US they were cosmetic and, furthermore, scope for capital deepening was greater because of scale economies and higher mobility. However, there is a narrow but not niggardly market for hacks who ignore the obvious and just babble modish nonsense.

Tim Bergin is a financial journalist. That's one step lower than an academic economist on the I.Q scale. He writes in Aeon- 


For the workers who are curious why their wages have not increased in the past decade –

 and whose spouses or parents aren't continually telling them it is coz they are as stupid as shit and utterly lack any sense of enterprise or get up and go

while the incomes of some, such as footballers, have soared

celebrity footballers- sure. But signing up a star means you can raise much more money and keep a cut 

– the Bank of England’s website has a reassuring message:

Coz guys in dead end jobs are constantly jerking off to stuff on the Bank of England website- right?  No doubt, they also turn to the Oscars website to get the reassuring message that they aren't Movie stars and thus should not bother attending the ceremonies to perform the chore of having to accept an award and then give an embarrassing speech.

‘There is a method to this madness: the economic theory of supply and demand’.

If you haven't had a raise in a long time it is because nobody is demanding to employ you at a higher wage in some other role. Don't be a shmuck. Make yourself attractive to better paying employers or move elsewhere.

The bank’s website provides an ‘idiot’s guide’ to the economy that explains how ‘Supply and demand is a bit like an economist’s version of the law of gravity. It decides how much everything costs: a cup of coffee, a house and even your salary.’

But we all already know this. Thus, when you ask for a raise, you mention how much another company has offered you. If your boss can't match it, you walk.  But this involves getting others to demand your services. This is something we all understand. It is easier to get married, if the other party is aware that you are much in demand. If nobody likes you, it is more difficult to get hitched. The same is true about popularity. Peeps who are 'in demand' get invited to more parties which in turn makes them more 'in demand'. 


The US Federal Reserve Bank provides similar explainers for Americans who

were actually looking for porn 

want to understand how their country’s wealth is created or allocated, including a colourful downloadable infographic that shows how higher prices create additional supplies of goods,

rather than teens going ass to mouth 

and lower prices create additional demand. On its website, the International Monetary Fund notes that supply, demand and price are ‘magic words’ that make the economist’s ‘heart beat faster’.

whereas for sensible people, those magic words are bukkake or tentacle porn.  

For the economists in the neoclassical tradition, as most are, the world can be understood as a series of supply-and-demand curves – the X-shaped graphs that Alfred Marshall first made for his book Principles of Economics (1890) and that now litter almost every chapter of almost every economics textbook. Humans might be occasionally irrational but, en masse, orthodox economics says they respond to prices in a consistent and proportional way.

They respond to rewards and punishments- unless they feel they deserve to be punished or no longer find anything rewarding. 

People have what economists call ‘price elasticities’

If they respond to price changes- sure. But they may not do so 

that make their behaviour predictable and open to manipulation.

But those elasticities can only be discovered after the fact. As for 'manipulation', why limit your paranoia? Why not suggest that everybody is being controlled by the neighbor's cat? 

Other factors such as technology, taste, the weather and institutions can also influence human economic behaviour. But economists see their impact either as modest or predictable, and thus capable of being factored in to supply-and-demand models.

Why? An economist may be paid a little money to advise on price changes. In return for that payment, the fellow may say- 'if you raise prices, people will buy less. They will go to your competitor'.  On the other hand, if you pay a witchdoctor, he might say 'If you sacrifice a goat to Satan, your competitor's dick will fall off'. 

This neoclassical perspective is widely, although not uniformly, accepted by world political leaders.

Coz it inspires more confidence in voters than getting naked at a Satanic orgy and chopping the head of a goat while demanding that Beelzebub bite off your rival's dick. 

It informs and underpins policies on taxation, spending, labour market regulation, health, the environment and more.

That's a good thing. The alternative is lots of goats getting slaughtered and Beelzebub biting dicks off.  

The problem, and a key reason why economic policy often fails, is that, while Isaac Newton’s law of gravity can predict behaviour at all times anywhere on this planet, these and other supposed economic laws often fail.

This is nonsense. Particle accelerators exist on earth. That's why we use 'modified Newtonian dynamics' but with a new generation of accelerators, MOND too may be modified.  

Take labour markets: the Bank of England’s and the US Federal Reserve’s claims that supply and demand determine wage rates, and that wage rates determine labour supply and demand, is not based on the best evidence. Economists know this too (we’ll get to that soon).

This is bizarre. Central Banks play role in setting wages. They publish reports from time to time with the aim of affecting expectations re interest rates. But publishing reports is not their function any more than providing coffee and biscuits is their function though, no doubt, such items may be provided to staff.

According to these supposed economics ‘laws’ (and a cheery video on the Federal Reserve Bank of St Louis’s website), higher wages make people work more, and lower wages discourage people from seeking employment.

But nobody gives a shit about the Federal Reserve Bank of St. Louis.  So what if they have a crap video on their website? 

In the real world, however, study after study over the decades has failed to find evidence of people working longer hours in response to higher net wages (be that through direct salary increases or tax cuts).

But those studies were shit. What econ says is 'ceteris paribus'- other things being equal- higher prices increase supply. But other things may not be equal. In particular, the 'Income effect' of a price change may swamp the 'substitution effect'.  

Over the long term, the data even more strongly tell us that labour supply does not respond to wage rates.

Fuck off! The data shows labour supply increased coz peeps came emigrating to America coz real wages were higher.  Ask any immigrant if he is working harder now then when he was back home having three siestas a day. 

Since the mid-19th century, real wage rates have risen sharply but hours worked by individuals have fallen significantly.

But lots more people have turned up in those places. So total hours worked have increased.  

The labour supply curve doesn’t slope up as the supposed economic ‘laws’ dictate but downward.

Nonsense! It does in aggregate. People from all over the world turn up wherever wages are high and rising. On the other hand, for any given individual, the 'Income effect' of a higher wage could increase leisure preference. However, such individuals could also have market power such that their own reduction of labor supply raises their rate. That's why the guys at the top play more golf while those in the middle slog away all hours. 

To put it in terms the Bank of England might understand, the labour supply curve defies gravity.

The Bank of England doesn't worry about wage inflation because we aint living in the fucking Seventies.  Trade Union leaders aren't constantly popping into 10 Downing Street for 'beer and sandwiches'. On the other hand, the Government does need to raise wages for nurses and other people who have increased work-load due to COVID. No doubt, the cretin writing this for Aeon would not approve. We don't need to raise the reward for nurses. They will be happy to just work for free. 

In practical terms, this means that if policymakers are trying, for example, to bring more women into the labour market,

Why the fuck would they want to do that?  Women have shown that they aint shy or retarded creatures who have to lured out of their homes and cajoled or cudgeled into making themselves useful. It is a different matter that policy makers may want to virtue signal by saying that is what they are trying to do. But then, almost all the time, policies are shit which shitheads 'make'.  

then assessing the issue via the lens of neoclassical supply-and-demand curves is unlikely to help them formulate effective solutions.

Cool. Don't raise the wages for women. Cut them. Let them work for free. That sure will be great for the economy. 

Hence the failure of so many tax cuts or relaxations of employment protection rules to nudge the economies in Europe and North America towards higher employment and growth levels.

People whose taxes are cut don't give a fuck what claim is made in order to make it happen. Less employment protection means lower 'compliance costs' which means more profit. Why pretend that the guys who finance politicians aint doing it in order to have more money.  


Labour supply is more a function of culture and institutions than price,

So let's not pay the workers. Just give them the right type of culture and nice Institutions- like Labor Camps.  

and this is not a new idea.

Cult leaders have always known about how brain-washing can get you a slave labor force. 

In 1978, the American Nobel Prize-winning economist Robert Solow stated plainly that the neoclassical article of faith that all markets clear – which is to say, settle on a price, where demand and supply are matched – was nonsense.

Wow! The guy discovered that 'gluts' occur only five thousand years after everybody else did. Markets don't clear. Sometimes there's just more fish, or grapes than people can consume. 

‘It is plain as the nose on my face that the labour market and many markets for produced goods do not clear in any meaningful sense,’ Solow wrote.

Which nobody who lived through the Great Depression didn't know. 

The failure of the neoclassical framework to explain important segments of economic life hasn’t dented economists’ faith in the universal applicability of supply and demand curves.

But supply and demand curves which hit the horizontal axis before they can meet- i.e. the market does not clear- are easy to draw.  In the Labor market, wage can't go to zero because workers have to eat in order to work. So some get jobs. Some don't. 

In the past 40 years or so, in fact, the trend has been to claim that such economic principles apply to more and more domains of life.

But, in the past 40 years, people have stopped paying any fucking attention to economists precisely because of globalized markets. 

Dig even a little into the data on tobacco taxes, and one is hit by some anomalies

Why dig at all? Like duties on alcohol or petrol, the thing was about revenue. 

Up to the 1980s, for example, smoking was seen as driven by cultural factors and the product’s addictive nature – researchers even struggled to get funding for studies that sought to investigate whether price could influence consumption.

Researchers struggling to get funding are as stupid as shit. Smoking like drinking 

But at the turn of the millennium, convinced by a raft of economic studies claiming to have established that smokers in developed countries had a clear and fixed ‘price elasticity’ with respect to tobacco, the World Health Organization declared price to be ‘the single most effective way to decrease tobacco use’. And, indeed, since 1980, real tobacco prices have increased as a result of taxes, and people are smoking less.

But Governments raised taxes to get revenue. Nobody gives a shit about the WHO- for very good reasons, as COVID has shown.  

Yet dig even a little into the data on tobacco taxes, and one is hit by some anomalies. Firstly, economists claim that the short-term price elasticity of demand for tobacco is around 0.4, and in the long term around 1 (meaning that a 1 per cent price drop would cause a 1 per cent rise in demand). If this is accurate, it means price increases drove the vast majority, or all, of the drop in smoking that occurred over the past 40 years. Given that in surveys most people say they quit for health reasons, this seems a stretch.

This is silly. When ciggies were cheap, peeps were constantly lighting up and then immediately stubbing them out- like in the old timey movies. People who didn't like ciggies still had ciggies. My parents didn't smoke but there was always a fresh pack of Benson & Hedges in the fancy Burmese Silver Cigarette tray. 

Second, the fact is that the pace of price increases and smoking rates are not well correlated. For example, the real price of cigarettes in Britain was lower in 1990 than in 1965, but per-capita consumption was 20 per cent lower.

Because pipes were still cool in the Sixties. Harold Wilson's pipe was considered sexy. By the Eighties only old men (and me) smoked pipes and the duty on them was much lower because pensioners were poorer back then. Still, it is true that people were quitting smoking or not taking it up because the English had become conscious that having horrible teeth and disgusting breath was reducing their chances of a bunk-up. Anyway, it was the char-lady who always had a fag protruding from the side of her face. 

On the other hand, some bulimic Sloanes and wannabe ballerinas were smoking like chimneys because they thought this would keep them thin. 

What really changed, beginning in the 2000s, was the culture around smoking.

And what really changed that culture was economic forces.  

The greatest indictment of the application of neoclassical price theory to smoking is the way those people with the least financial incentive to respond to the price signal appear to have responded most strongly, while those with the strongest incentive were not impelled to react. Today, in affluent neighbourhoods in Britain smoking rates are under 10 per cent, whereas in some poor ones it’s 50 per cent.

Because tobacco is a 'Giffen good'. As with other staples or addictive substances, as the poor pay more for it they have less to spend on other things with the result that they buy more of it. Currently you have a steak and a baked potato. Potato prices rise. You end up buying two potatoes and no steak to fill your tummy- if you are an abject loser. But there will always be an underclass of losers.  

If neoclassical theory were sound, those numbers would be reversed.

No. We expect richer people to have more access to 'gross substitutes'. We expect the abject and beaten down to have fewer and fewer options. 

Around the world, this trend is replicated. That’s a fundamental breach of neoclassical economic principles.

Not if- as cigarette companies do- you properly segment the market and discover the different types of representative agents it contains. Aggregation problems bedevil Econometrics, unless it actually pays somebody to find out the truth.  


The consequences of claiming that you’ve scientifically proven that consumption can be proportionately impacted by price manipulations is enormous.

Fuck off! There are no consequences whatsoever.  You can claim to have invented Time Travel till you are blue in the face and nobody will pay a blind bit of attention. However if you discover something useful and get very rich, people will beat a path to your door no matter where you hide yourself. 

In this case, for example, faith in the theory delayed by years all the health warnings, advertising restrictions and smoking bans – all those measures that really contributed to a denormalisation of smoking.

Fuck off! Governments saw taxes on tobacco as a cash cow. But once price elasticity increased, they had to look at the other side of the picture- viz. higher future spending on health care (sadly, the fucking Doctors were keeping working class males alive after they retired. This meant the Government couldn't cheat them out of their pensions and health entitlements). 


Some economists have questioned the profession’s obsession with price.

As opposed to what? Culture?  Do we really want Economists to be gassing on about how everybody should listen to Beethoven because this would incline them to work for free? 

In the later years of his long life, Ronald Coase,

who studied Commerce, not Econ, at the LSE because he wanted to be a Solicitor 

one of the most influential members of the conservative Chicago School of Economics, began to lament how economists in the 20th century had gone down the rabbit hole of focusing on price sensitivity.

Price sensitivity is about opportunity cost- i.e. what substitutes are available. Globalization means there are more substitutes. Elasticity increases. Pricing suddenly becomes very important. Ask the Rust Belt. They priced themselves out of the market and are now feeling very sorry for themselves.  

Coase's theorem, properly understood, says 'who owns what doesn't matter'. All that matters is who has the higher opportunity cost for a given resource. He can pay the other guy to use it or Society could allocate it to him. Provided deals can be made, deals will be made. 

He said that, rather than studying real-world wealth creation, as early economists such as Adam Smith sought to do, their successors had focused on building mathematical models of the world and probing datasets to find correlations consistent with the models.

Smith didn't make money. Ricardo did. Wealth creation was well enough understood because a lot of it was going on wherever you looked. Meanwhile a few people looking to enter service industries like the Law or Accountancy or the Government Bureaucracy or Journalism took a few courses in Econ at Uni. That's it. That's the whole story.  

Coase didn’t consider such work to be empirical, dismissing it as ‘blackboard economics’.

Coase, as a student of Sir Arnold Plant, had looked at how firms work and realized they 'internalize externalities'. However, if taxes or compliance costs increase, they can disaggregate and use contracts of adhesion to escape exploitation. 

In the past two decades, there’s been a turn against ‘blackboard economics’. Some younger economists have made careers out of going out and studying the world as it actually is, and deriving an economics – insights, conclusions and solutions – based on this empirical work.

Fuck making careers. Did they or did they not become mega-billionaires? That's the only question we are interested in. We all now understand that you are only a good economist if you are either making billions or saving somebody billions. Having a career talking stupid shite is about as impressive as making money of perverts on the internet who pay for live-cam footage of you taking a dump. 

The Massachusetts Institute of Technology and the University of California, Berkeley have been especially prodigious in producing such economists.

While China has risen and risen.  


Isaiah Andrews, one of these new ‘empiricists’, won the 2021 John Bates Clark Medal – the most distinguished economics prize in the United States. Andrews has worked on the problem of publication bias – whereby research that confirmed prior beliefs could have a better chance of being accepted by academic journals.

So the guy won a prize for showing that the stuff for which the prize is being awarded is worthless shit.  Cool. 


Melissa Dell, another of the new ‘empiricists’, won the 2020 Clark Medal for work that highlighted the importance of institutions in the development of economies.

And Clarissa Bell will win for highlighting the importance of economies for the development of Institutions and then Galissa Jell will win one for highlighting the importance of importance.  

Her award signalled a real shift.

Or an imaginary lift.  

For almost a century, the economics establishment has downplayed the role of institutions, in part because institutional factors don’t easily fit into the mathematical models that generate precise, scientific-looking results.

Actually, there is no difficulty in putting in proxies for them.  


The 2012 Clark medallist, Amy Finkelstein, has used randomised controlled trials in healthcare to understand how people use and are impacted by insurance coverage.

Though everybody else already understood this and then some.  

Her work has revealed how such markets can defy the laws of supply and demand,

This is nonsense. Her big discovery was that having health insurance improves health. However, everybody already knew that going to the Doctor improves health and that having medical insurance means you avail of medical remedies more often.

Without demand and supply there is no market. It can't defy shit because it doesn't exist.  

and shows that government intervention can help address market failures.

Or create them.  


Markets don’t respond, as neoclassical theory claims, to the sudden hike in wage rates

Yes they do. Short run elasticity may be low. Long term it is high.  


Another indication that economists have at last moved to study the world as it is, the award of the 2021 Nobel Memorial Prize in Economic Sciences went to three empirical economists including David Card. Few people have been at the receiving end of the economic establishment’s ire as much as Card.

Utterly false. Card is a quiet Canadian who doesn't make waves. His work on post 1980 Cuban migrants to Miami, which did not greatly lower wages for the unskilled, is seen as pro-immigration which is what most economists are- either because they are of immigrant ancestry or because they are right wing or because of political correctness. 

However Card's work was obvious shit. Everybody had seen 'Scarface'. The knew about cocaine. The fact is the Cubans were both creating businesses and staffing them in a segregated manner. Consider the following- In 1977, Cubans owned 7 336 businesses in the Miami-Hialeah area, most of them in services, retail trade, and construction. By 1992, Cubans owned 46 900 firms. Clearly Card was a silly man- but all Nobel Prize winning Economists are silly. 

When Card’s work was first published, one Nobel laureate declared it ‘equivalent to a denial that there is even minimal scientific content in economics’.
That was Buchanan who was pretty old. I suppose he meant that this type of cherry picking made the profession look ideological, not scientific. But that boat had sailed over a decade previously.
Until the early 1990s, the accepted orthodoxy among liberal and conservative economists was that the minimum wage killed jobs.

No. What changed is that Union power had declined and so minimum wage laws could no longer be used to limit employer's ability to outsource which in turn reduced Union enrollment in a virtuous circle that broke the back of that beast. The problem was that the minimum wage would have to be linked to the 'replacement rate'- i.e. there would be a knock on effect on Social Security and other such entitlements.

One reason this whole issue doesn't greatly matter any more is that Federal States are extracting less and less from all but the upper quartile though immigration distorts this to some extent. This means that minimum wages are part and parcel of local 'Tiebout sorting'.  But this will favor indigenous people in various ways- in other words Labor won't be a commodity market. 
It simply had to, because the laws of supply and demand said the measure pushed the price of labour above the so-called ‘equilibrium wage ‘or clearing wage at which supply and demand were matched.

No doubt, there was a lot of hypocrisy- not to mention downright ignorance- in the profession. Still, back in the Eighties, it was not at all obvious that Unions might not make a comeback and increase their market power by raising the price of the substitute.

Card and his colleague Alan Krueger conducted studies that found, in a number of cases, that meaningful increases in the minimum wage had not led to lower employment in fast-food restaurants – the type of business commonly affected by the measure.

But the type and ownership of fast-food restaurants changed. In some cases there was capital deepening, in others there was increased self-employment or the substitution of those beneath the age of coverage.  

The research received a lot of publicity, and near total rejection by some of the most eminent economists, for example Gary Becker, Robert Barro and James Buchanan, who likened colleagues who accepted Card’s work to ‘camp-following whores’.

They needn't have bothered. Unions were dead in the water. The supposedly pro-Labor political parties didn't want to listen to Union bosses because they were stupid or evil or both stupid and evil. Still, political parties will take money from anybody- no matter how repulsive.  

In any case, it didn't matter what type of drive by regression you did to get your Junk Social Science PhD, new technology was making skills of that sort reasonably remunerative. Indeed, smart guys like Bezos could make big money out of Econ PhDs. 


History, however, has been on Card’s side. Study after study (140 in the UK alone) has found that even large increases in the minimum wage have failed to lift unemployment.

These are meaningless studies. If you have eyes in your head- or just ears to catch all the new foreign languages being spoken on the streets- to realize that ceteris has not been paribus. 

Labour and product markets don’t respond, as neoclassical theory claims, to the sudden hike in wage rates.

So lets not raise the wages of nurses in the NHS. See how that works out. This is the other side of the coin. 

First, employers in the US and Europe have reported that they can easily pass on minimum wage increases to customers.

In the short-run- sure.  Then China eats your lunch and suddenly everybody is flipping pizzas for Chinese tourists and thus too busy to wonder when it all began to go wrong. 

To ‘blackboard’ economists this makes no sense – after all, if customers were prepared to accept higher prices, the companies would have already tried to increase them. But it appears the wage hike fundamentally changes the behaviour of both employer and customer in a way for which theory cannot account.
Yes it can. Previously, there was a Nash equilibrium. After the public signal re. minimum wages, there was an Aumann correlated equilibrium. 
In effect, we see that consumers of services or goods do not have fixed preferences; they either do not have a price elasticity of demand, or it’s so subject to change that estimates of it are as useless as predictive tools.

Rubbish. Smart people get rich because they have an intuition as to the direction of that elasticity though its computation is in a higher time class.  Econ isn't like Physics. Ordinary people have never met a quark. But guys who don't know the meaning of 'Shapley value' have better intuition for what it might be, than any game theorist, in contexts familiar to them. This is because they have superior ideographic knowledge. 


Card’s Nobel Prize is a sign of economics advancing along scientific principles of learning from its previous errors.

No. It is a sign that there's been a big literature on this.  

A clearer sign is the fact of governments in the UK and Germany, which had been sceptical about minimum wages, proceeded in 1999 and 2015 respectively to introduce them.

With the result that Income inequality increased.  

Yet every introduction of a minimum wage and every above-inflationary increase is met with warnings from the economic establishment.

Who get paid just as this cretin is paid.  

For example, when Germany proposed a minimum wage, the state-appointed panel of economic experts known colloquially as Germany’s ‘wise men’ called the suggestion that the measure would not kill jobs ‘a vast illusion’.

It killed a lot of micro firms which raised productivity overall. On the other hand, in some sectors, this may reduce dynamic efficiency. But Germany may have missed that boat anyway. The bigger problem that country faces is the depopulation of the East. However, it should be noted that poverty and welfare dependency have not been affected. There are also some questions about enforcement. It may be that the biggest overall effect will, with hindsight, prove to be reinforcement of an ethnically segregated Labor market. 

More recently, the economist Larry Summers warned last year that US President Joe Biden’s proposal for a $15 minimum wage would cause employers to ‘shift away from the most vulnerable and inexperienced workers’, while Britain’s most widely cited economic forecaster, the Institute of Fiscal Studies, warns at least once a year about the potential employment effects of the UK’s typically modest minimum wage increases. Card told me that outside the field of labour economics, where scholars had studied the subject in detail, many of his fellow economists still struggled to accept the findings.

But they still get paid for repeating the same shite year after year, decade after decade.  This journalist can then get to recycle this same article ad nauseam.

Incidentally Aeon has very kindly deleted my comment on this crap. I offer it to you here-

Economists know that the Economic theory of Economic credentials emphasizes the worthlessness of the content of what is taught or said. The thing is merely a screening and signalling device. In other words, an Economist is a guy whom for a modest wage, you can get to spout sycophantic drivel while being very very boring and stupid. On the other hand, you can hire quants with a bit of Econ and point them at specific things and pay them quite well while yourself, like Bezos, becoming a mega billionaire. In my experience it is always possible to find one guy- even one with an Econ PhD- who has the sensible solution to the underlying problem. But that’s why you need the other, celebrity-craving, tossers to cater to the demand created both by rent seekers as well as that which would exist for prudential reasons (i.e. we may not want a particular regime to succeed because this will embolden them to do something utterly bonkers). All the examples given in this essay are foolish. They point to the shitty nature of Econometrics, by reason of aggregation problems, not to any great fault with the neo-classical model adjusted for Knightian Uncertainty. Everything mentioned in this essay as an indictment of Marshallian econ was known by the end of the nineteenth century though some technical terms were invented afterwards. Thus the ‘Giffen good’ whose consumption rises amongst the poor (or addicted) as its price rises was known to Marshall though perhaps Slutsky’s analysis of the Income and Substitution effects and Hicks’s work on this were not known. By the late Seventies, almost all the mathematical tools were available to recast Econ theory in perfectly ‘realistic’ terms. However because of Goodhart’s Law type problems it was always the case that Econometrics would harm policy making. Coase, of course, wasn’t Coasian. He originally studied Commerce to become a Solicitor. It is enough to displace Mathematical Econ by a Muth Rational and ‘Hannan Conistent’ type of ‘Law & Econ’ for a perfectly servicable positive Econ to exist. Here, instead of ‘duality’ you would have ‘adjointness’ by reason of not optimization but regret minimization- i.e the thing would be Category Theoretical not stupidly Topological. Why hasn’t this happened? The answer is the same as why Professors of Philosophy or Literature or History or other such ‘sub-Humanities’ are utterly stupid, ignorant and paranoid. Briefly, only careerist cretins will do PhDs in that nonsense and so those subjects have become adversely selective. In Econ, this doesn’t matter at all because computing power and data accessibility have increased exponentially. Smart dudes can just get very very rich and then, like Soros, hire utter imbeciles so as to destroy in advance their own vision for the world. There are some mathsy Economists- Aumann, Myerson even Chichilnisky when young- whom I liked. But then I once rated David Lewis!- but the Maths had moved on and even ignorant hicks like me, thanks to Wiki and Stack Exchange, can now very quickly gain and flesh out superior insights after a bit of Googling while sipping a Rum & Coke. But this is a pretty useless activity befitting only a Socioproctologist- i.e. a guy who gets his jollies by pointing a finger at stupid Academic assholes. Economia is discovery. Akreibia is as Wittlesstein put it ‘shitting higher than your arsehole’. Economists and Economics as a subject should have no impact whatsoever. It is stupid and makes its minions stupider than they need to be. Mimetics- imitating what smart peeps be doin’- is all that matters. Sadly, I am the sole member of the Institute of Socioproctology (where I’ve been demoted to Asst. Director after a Me Too incident involving allegations of self-abuse) and thus Tardean Mimetics rules out any major reform of Econ as a profession. Vide https://socioproctology.blogspot.com/2019/03/keyness-big-mistake-thinking-economists.html (https://socioproctology.blogspot.com/2019/03/keyness-big-mistake-thinking-economists.html)


Thursday, 13 January 2022

Berins Collier & Grumbach arranging my marriage to She-Hulk



Ruth Berins Collier & Jake Grumbach, Political Science Professors both, affirm, in the Boston Review that

 a country’s economic model can organize and disorganize political groups, empowering and disempowering them and shaping the coalitions they form.

This is nonsense. What matters is whether you have a young population or an ageing population. In the US, 50 is the median voting age. 22 percent of votes cast were by the over 65. These are not guys who care about the 'economic model'. They care about fiscal policy and interest rates because what they get paid for working is becoming less and less important to them. As for the young, student debt matters as does affiliative motivations for voting of a Religious, Racial or Ideological kind. Once again this has a weak connection with a 'country's economic model'. 

Structural economic factors do matter- the Rust Belt made that clear- but where there is structural unemployment there is also likely to be an element of over-representation such that fiscal transfers can be extorted. In other words, pork-barrel, not ideological, politics wins out.

Industrialism, we argue, was fertile ground for the construction of a pro-democracy coalition,

Coz that's what's happened as China industrialized- right? The truth is, industrialism was a fertile ground for the construction of Teamsters and Mafias and Pinkertons and gun toting maniacs of various types. 

one supported by labor unions; 

Who was it Jimmy Hoffa supported? The good thing about the guys in the hard hats is that Nixon could always get them to go crack the skulls of hippies. But Mao had gotten his proles to beat the shit out of the students who, having served their purpose during the Cultural Revolution, were then sent off to the countryside. 

On the other hand, I bet these two Professors really love Police Union Chiefs who believe in 'killology'.

post-industrialism, or at least the transition to post-industrialism, has fragmented such a coalition. 

When? In Reagan's first term? Or Nixon's first term? How about when Eisenhower was elected? 

The current problem is how to organize a pro-democracy coalition in the face of the Republican assault.

Tell lies. Lots and lots of lies. The stupider the better. Anyway, what else can you do if you happen to be a Professor of a shite subject? 

We point, in particular, to two salient structural features of post-industrial political economy that constitute a challenge to democracy. First, to use a term of art from political science, 

as opposed to a term of art from the burlesque theater

the structure of mass politics shifted from a single dominant “cleavage”—a conflict between owners and workers organized by labor unions—

so that was way back when America was racially homogenous- right? Also there was no farm sector or self-employed tradesmen. 

to a pattern in which politics is organized around many different competing cleavages.

Because the population is not all of the same age, ethnicity and occupation- with the exception of a few evil Capitalists wearing spats and Top Hats and drinking the blood of the proletariat out of diamond encrusted goblets. 

 Second, there was a shift in the balance of power between capital and the state, which reduced the capacity of the government to respond to social and economic upheaval.

A shift in power is a political, not an economic, change.  So what these cretins are saying is 'a political change occurred because of an economic change which was caused by that same political change- viz. that the State suddenly became shite and its capacity contracted and Capitalists started taking its pants down and going in dry. 

Both of these developments 

there is only one development here. The State turned to shit as did the Unions coz, for some mysterious reason, Capitalists gained superpowers and used those super-powers to fuck everybody in the ass. 

present a challenge to democracy, and technology has only accelerated each.

Coz Capitalists have an app which they can use to fuck you in the ass even when you are on the toilet. 

In making this argument, we see ourselves engaged with a budding American political economy community that uses comparative and historical lenses 

lenses? No. Blinkers.

to understand the effects of structural forces. Our story challenges the progressive view of history in which modern democracy is a “developmental” or “evolutionary” achievement toward a more “advanced” outcome. 

Fair point. Teaching History can make you just as stupid as teaching Poli Sci. Democracy is what you get when a dominant coalition resolves its own internecine rent contestation through some, more or less gerrymandered, voting mechanism. 

Instead, modern democracy might be an outcome of a particular historical political economy of industrialism that began in the nineteenth century and may be ending—ushering in great uncertainty about the future.

This is nonsense. America is ageing and non Hispanic Whites may become a minority. Technological changes mean the country, like other advanced economies, will see more 'subsidiarity' and 'Tiebout sorting' in some places while others will experience depopulation. The Federal Government will become weaker abroad and at home. Biden may, in his first eighteen months, both surrender American hegemony abroad and the willingness of the Federal Government to intervene to protect Voting Rights at home. He will have rolled America back to what it was before he was born. 

 The democratic politics of the future must reckon with the consequences of these dramatic developments if it is to survive.

The democratic politics of the present has survived by becoming more and more shit. If it aint broke, why fix it? A type of politics which just keeps stupider and more paranoid can carry on indefinitely- especially if you have an ageing population. Sooner or later there is fiscal crunch and a technocrat is put in just so as to keep the lights on. 

The Organization of Popular Politics

In the advanced economies, the golden age of democracy coincided with the age of industrialism, from the late nineteenth to the late twentieth centuries, and the politics of economic cleavage to which it gave rise.

Hitler's Germany was 'advanced'. Stalin's Russia became advanced. Japan and South Korea and Singapore are advanced- as is China, in many respects- but they simply didn't have any fucking politics of economic cleavage at all. The UK and the US may have had these features to some extent but there were other factors- Race in the US and the Empire for the UK- which meant that 'cleavage' had little salience almost all of the time. 

The plain fact of the matter is that. because of 'efficiency wages' and 'duality' in 'industrial districts', big corporations paid their own workers very well while relying on 'dis-integrated' small firms for components and ancillary services. In other words, the Labor movement was always split between an 'Aristocracy' and a low wage underclass. In the early Seventies, the 'Aristocrats' broke the power of the State to enforce a Prices and Wages policy (which was needed to stick with managed exchange rates, exchange controls etc) and happily voted for Thatcher and Regan even after Scargill's coal strike or the Air traffic controllers slitting their own plump throats etc. Continental 'Corporatism' could not deliver 'solidarity wages' but, in France, yielded feather-bedding. However, Germany did get a social compact though it appears to have pissed that advantage against the wall by failing to do infrastructure and by pursuing a crazy Energy policy. But all that is irrelevant. The fact is Europe could only converge to the Anglo-Saxon model by converging to its Racial problem and 'original sin' of Imperialism or ethnic cleansing or whatever. 

Once labor unions were legalized, they made the decision to participate in democratic politics and became the most important lower-class interest organizations in the country. 

Then the First World War happened and Eugene Debs was put away for a long stretch of porridge. But factionalism amongst the Socialists and between Unions had already put paid to the myth that Democratic Socialism was not an oxymoron.

Anyway, it turned out that the Workers of the World didn't want to unite. They wanted to fuck up furriners something fierce. The truth is there has to be cooperation between bosses and workers. But the economic interests of Nations, or even Regions, can clash- which means industrialized War of which the US Civil War was the first expression. 

Our contention is that unions were critical in sustaining mass democracy

Though India has had mass democracy with only a miniscule proportion of the electorate in paid employment. On the other hand, the Unions in Spain played a part in so fucking over that Republic that Franco took power and kept it for decades before restoring the Monarchy. 

 by virtue of their role in organizing, mobilizing, and sustaining a politics that embraced a broad pro-democratic coalition, 

Anglo-Saxon and Scandinavian countries like Democracy. There is no coalition for some fucking Dictator or Commissar. One good thing about Democracy is that it gives the Government the legitimacy to really fuck over Union Chiefs who go crazy. After all, the same guys who voted to go on strike also voted for the administration which will enforce the law against Union thuggery. 

which they were able to do on the basis of materialist demands that went beyond the specific interests of their own membership. 

Very true. The Teamsters were always campaigning for Transgender rights. London dock-workers created the Notting Hill Carnival as a way to welcome the Windrush generation from the West Indies. 

With the decline of unions and of an industrial workforce on which they were based in the second half of the twentieth century, 

the Mafia makes less money off the Teamsters. The Federal Government doesn't have to do a deal with Lucky Luciano to keep the docks open during war-time. 

no alternative organization has been able to articulate a unifying coalition with similar force.

So Obama's Organizing For America was completely shit then.  Good to know.

As one of us has argued, democracy cannot be seen simply as the achievement of the working class in the first-wave cases in Western Europe and the United States. 

It wasn't their achievement at all. Universal manhood suffrage was either a product of 'Jacksonian' or 'Napoleonic' policies focused on the agriculturist or else a Tory dodge to get in the bigoted upper working class as a counterweight to the radical. urban, educated middle class. Female suffrage helped the Right, not the Left. Incidentally, India could have had universal suffrage in 1930 same as Ceylon but the Muslims wouldn't bite. France only gave women the vote in 1945. This prevented it going Red. 

Nevertheless, sustaining democracy did require the buy-in not only of conservative parties, as political scientist Daniel Ziblatt has argued, but also of the working classes. 

Why? Would they refuse to vote otherwise? Who says no to an entitlement? 

During the period of industrialism, unions became the dominant organized voice of the working class,

but that voice was shrill and shite. Workers didn't mind if that type of ranting screwed a bigger pay-deal out of the bosses, but they certainly didn't want those nutters to have any power to fuck up foreign policy or stuff that mattered to the Nation. The same was true of Women who tolerated Academic Feminists only so long as they kept whining on about how random dicks are incessantly belaboring them and bashing them senseless. 

 unifying its interests based on a materialist dimension and supporting democracy.

Because democracy keeps getting raped in alleyways and needs a lot of hand-holding and emotional support from burly shop-stewards- right? 

 In the post-industrial period, by contrast, the structure of the working class has changed and its voice has been fragmented, reducing its power and political effectiveness, and opening the way for internal divisions.

But that happened long ago! By 1984 only 17 percent of 30 year old  were Union members. In 2006 it was 6 percent. Boomers- of whom I am one- thought they sucked ass big time though, no doubt, we'd take extra money if they could get if for us while still resenting the dues we had to pay. 

During the era of industrialism, the key role of unions was to prioritize materialist demands in the political arena along a dimension on which issues could be negotiated and compromises reached.

Their job was to create a strike fund and thus gain a threat point in collective bargaining. When they stopped being able to do so- partly because of infiltration by Lefty nutters- they were disintermediated. 

There was a time when some Professors thought their job was to turn students into a vanguard for the Left. But the students just got high and babbled nonsense. Then they demanded that they get credentials for jacking off which, because they now had market-power, is exactly what they got. These two cretins are stuck teaching stupider and stupider cretins just as their Professors were stuck teaching them. 

 Dominant factions of the labor movement championed democracy as a political vehicle, and the struggle along the materialist dimension was quite successful, with rising prosperity for all, culminating in a politics of class compromise of different versions across the industrial democracies of the Keynesian welfare state.

Then the population began to age and savers took back power from borrowers. This meant free exchange rates, low inflation, cheap Chinese tatt to contain 'cost-push' inflation, asset stripping to release value for institutional investors etc, etc. To be fair, Keynes had admitted that his model would work better in Nazi Germany than an Anglo-Saxon democracy. Still, it was only when the A-rabs rebelled against Bretton Woods that Keynes's cozy racialist dream came crashing down. Why couldn't the wogs and nignogs not simply have let the White working class of the 'Advanced' countries live a little longer in their dream world? 

As economist Albert O. Hirschman argued in The Passions and the Interests (1977), material interests came to be seen and championed in seventeenth- and eighteenth-century political thought as “containing the unruly and destructive passions.” 

That's not rocket science. The reason we don't get drunk and set our workplace in fire is because we would then not earn any money and thus would not be able to pay our mortgage and then our spouse would leave us for a guy who had less 'unruly and destructive passions'. 

Students know this. They can be plenty unruly and destructive on campus but once they get a well paid job they have to be all buttoned up and Caspar Milquetoast and shit. 

Another way to put this is that bosses pay an 'efficiency wage'- i.e. a premium on transfer earnings- so workers have an incentive not to get drunk and stick things up their bosses rectums while laughing hysterically. 

It is no coincidence that the illiberal alternate political cleavage of resentment and scapegoating has been especially appealing

to stupid Lefties who blame everything on Capitalists unless they are also anti-Semitic in which case...

 where deindustrialization has occurred and where unions have been in retreat and no longer organize or lead the political struggle and at a point when materialist advance has been halted for so many.

So, even if Unions are really sweet and kind, they still can't help improve society unless they can get their members high wages and benefits. The problem here is that Unions know about bargaining but don't know about how to raise productivity. They are merely parasitic on Capital. 

 Sociologist Seymour Martin Lipset, in Political Man (1960), also points to the danger of the passions. We do not accept Lipset’s analysis that the working class is particularly prone to authoritarian attitudes and intolerance; in Latin America, for example, it was the middle and upper strata who abandoned democracy in the 1960s and 1970s, while the working class held fast.

But, because of Castro, Che Guevara etc, Latin America was fucked no matter what happened.  Lefty nutters had convinced themselves that they needed to have a Revolution to make their dicks bigger or their orgasms better and then some wonderful magic would happen and everybody who was not a Capitalist would become very very rich while reactionaries were reduced to renting out their rears for a couple of pesos at a time. 

Still, the passions of resentment—the intolerance and scapegoating that Lipset points to—are an alternate line of appeal to those seeking to mobilize a following along a different line of cleavage.

These guys are very tolerant of Republicans- right? They aint scapegoating Trump for all Democracy's ills.


In the United States, some degree of democracy preceded the rise of unions,

as it did in any country which had unions

 which therefore did not play a role in the initial process of democratization as they did in some of European countries. 

Which ones? Britain? Nope. Germany? Nope? France? Nope. Spain? Because Paul Lafaurge, Marx's son-in-law, was involved with the foundation of PSOE, both its Unions and its Democracy was fucked from the get go. 

Almost everywhere, there was first universal manhood suffrage- or something pretty darn close to it- and then you had Unions because Political Parties could get a bite of that sweet sweet moolah the stupid workers were paying by way of Union dues. 

On the other hand Sweden first saw Unions and then got universal manhood suffrage though this was scarcely the determining factor. I suppose the Scandinavian example had a big impact on some American States- Wisconsin etc- and the Nordics certainly did have a big impact on American progressive politics. 

But early American democracy was, to put it lightly, not very democratic;

it was a fucking racist nightmare involving genocide and slavery on a vast scale. 

it was not until the mid-twentieth century that the country 
Women got the vote in 1920. Black Southerners had to wait till 1965 for the Voters Rights Act.
expanded the franchise to women and Black Americans. In establishing this more substantive form of democracy, unions were central.

No. What was central was the mobilization of the would be voters. 

This is not to say that unions have always been virtuous. 

They have never been so. That is not their function. Their job is to collect money from members and use that money to make sure the members get more back from employers in the shape of higher wages. 

We do not deny that in the United States and elsewhere, unions could be vehicles for racism and xenophobia.
and raising wages for members while preventing young people get well paid jobs. Ultimately, this also involves killing of the industry and off-shoring the jobs. 
 The American Federation of Labor (AFL) supported the racially discriminatory Chinese Exclusion Act in the late nineteenth century, for example.

They also opposed unrestricted immigration from Europe to keep up real wages.

 And scholars at least as far back as W. E. B. Du Bois have highlighted the threat to democracy posed by white workers preferring to align with economic elites against egalitarian democracy in order to maintain their “psychological wage” of hierarchical privilege over Black and immigrant workers.

Why speak of a psychological wage when there was a genuine real wage differential? The fact is this only narrowed during the War and its immediate aftermath. But a lot of that convergence had to do with disproportionate mobility and productivity gains for 'great migration' African Americans.

At the same time, it is important to recognize how, in the twentieth century, U.S. labor unions played the important role of helping to foster a multiracial worker coalition that served as a bulwark for democracy.

And Nixon. On the other hand, it must be said, FDR was so pro-Union that Labor did become a bulwark for the Democratic Party. But it was as Racist as shit. 

 Beginning in the 1930s, unions, especially the Congress of Industrial Organizations (CIO), began to construct ideological linkages between racial and economic democracy and organize Black and white workers, alike.

But the Taft Hartley Act of 1947 forced a lot of their leaders to swear they weren't Commies which many refused to do.

 By the 1960s the AFL-CIO was a major organizational proponent of the Civil Rights and Voting Rights Acts that ended Jim Crow in the South. 

African Americans themselves had nothing to do with it- right? 

Such union efforts in expanding democracy were born of strategic imperatives of unions in the industrial period, which saw the need to organize multiracial coalitions in a racially divided society. 

Union membership peaked in 1954. Nevertheless Jim Crow had another decade to go. Arguably, it was the State Department and the Pentagon which did more for Civil Rights. 

As Martin Luther King, Jr. wrote in 1962, “the coalition that can have the greatest impact in the struggle for human dignity here in America is that of the Negro and the forces of labor, because their fortunes are so closely intertwined.” 

He said that to a bunch of sanitation workers or laundry workers or something of that sort.

As a consequence, the labor movement has played an important role not only in building broadly shared prosperity, reducing economic inequality overall, but also in doing so between racial groups. It has thus become increasingly clear that labor unions play an important role in safeguarding particularly, multiracial democracy.

This simply isn't true. The American case shows that Unions can grow strong while race and gender discrimination remains strong and they can also grow weak as that type of discrimination diminishes- at least for a 'talented tenth'. 
Unions have resisted anti-racist or gender-discrimination legislation and enforcement. American police unions aren't considered the friend of the Black citizen. On the other hand, weak Unions can't block, or render null and void, Liberal reforms of a type which 'pay for themselves' by raising productivity and improving life-chances. 

In fact, by building political coalitions around materialist politics and preempting a politics of racial and cultural resentment, labor unions in the modern era continue to be critical to the maintenance of democracy in the United States. 

Actually, they were critical to America's position as Capitalism's global enforcer. Union members get higher wages if nineteen year olds- who would otherwise be bidding down wages or reducing 'differentials' for the skilled- are shipped off to some remote jungle to get shot. 

A recent study coauthored by one of us finds that labor unions reduced racial resentment among white workers between 2010 and 2016—helping to organize white workers around the material wages of shared prosperity rather than the psychological wage of hierarchical status described by Du Bois.

Wow! The fact that there was a black President didn't matter. Proles were still so fucking shit they were hanging on to some 'psychological wage' when all they had to do was turn on the TV to see umpteen shows making it clear they were piss-poor protoplasm, red-neck, meth addicted, trailer trash scum living in flyover states. Did Unions stop these guys voting for Trump? Did it reconcile them to being described as 'deplorables'? 

Thus, although unions may not have had the same dominance in the United States as elsewhere, they became the core constituency of the most important political party on the political left. In this sense, the Democratic Party
which was the Party of Jim Crow

 of the industrial era, like its European social democratic counterparts, could be characterized as a labor-based party. 

Though white Union members might prefer to vote Republican. Still, Hilary got 100 million dollars from the CIO-AFL. That was money well spent- right? 

The fact is Unions can raise wages at the expense of either employers or non-Unionized workers and the self-employed. Talk of solidarity is all very well but Union members benefit most when their employers too are left with plenty of cash to invest in growth and innovation. But then the 'talented tenth' of any discriminated against group gains by cornering all the 'reparation' for themselves. 

Unions structured and channeled interests into demands along materialist, and specifically “productionist,” lines.

Because they collected monetary dues, not metaphysical gratuities, from their members. In return they claimed to be able to get higher pay awards so that their members gained in net terms. Obviously, political parties paid by the Unions could impose 'closed shops' and 'political levies' so as to have an ATM for themselves. Sadly, workers could rebel and vote for other parties who might repeal such laws and make the State a 'right to work' jurisdiction. 

 Even in the Toquevillian United States, 

early nineteenth century America? How fucking delusional are these guys?

where “pluralism” consisted of an unusually diverse set of other kinds of interest organizations, the dominant cleavage for organizations that make political or public policy demands was the economic cleavage: it was, after all, American social scientists who proposed that politics could be modeled along a single economic left-right dimension. Labor unions were the most important organized interests operating on one end of that cleavage.
In the Fifties, sure. After that- not so much. The plain fact is that Labor can price itself out of the market. That may be a good thing. 'Dad's lads'- i.e. the kids of feather-bedded Union members- are forced into new non-Unionized roles some of which become increasingly 'high value adding' while cost-push inflation is contained by 'globalization'- i.e. cheap Chinese labor. 

With the advent of post-industrialism since the 1970s, however, these fundamental structures of interest articulation have been dramatically transformed.

But the Unions had already fucked up. Nobody in Nixon's America was saying 'Jimmy Hoffa is the man to rescue American Democracy'. 

 A popular interest structure that expressed a dominant economic or materialist cleavage

which had ceased to exist as consumers, and retirees, and savers, not workers, began organizing to get a better deal

 gave way to one that was fragmented around multiple lines of cleavage, expressing both important new issues—but also a backlash to them.

Because the Left was shit. So was the Right but the Right could be less programmatically shit because it could point to blonde Fox news anchors with a more interesting type of cleavage. 

Why was the Left more shit than the Right? The answer is that the Left wanted to fight mythological monsters from the nineteenth century- Capitalists, Slave owners, and other varieties of White Men who weren't wearing frocks- whereas the Right was pointing the finger at obvious nuisances of various types which could easily be curbed by concerted ridicule and mean tweets. 

Consider the following- it is wholly delusional

We have argued that in the period of industrialism, 

it is a tautology that industrialism means 'rapid growth of the industrial sector'.

the rapid growth of the industrial sector and the economics of Keynesianism

which was a function of War-time and post War, Bretton Woods, fixed exchange rates and thus exchange controls, restrictions on capital flows, gold ownership etc. But all this was predicated on A-rabs and Nig-nogs and Gooks of various types shutting the fuck up and doing what they were told. Communism- Soviet and Chinese victories over Imperialist Capitalism- is what put paid to Keynes's world. Still, if Nixon or the British Labor Party had been able to use a Price and Incomes policy to contain inflation then Anglo-America might have evolved in a properly Fascist direction with a State mandated National Federation of Labor and Conscription and endless wars in resource rich parts of the world populated by dusky folk. 

 underwrote a social contract and facilitated a supportive positive-sum coalition.

Positive-sum? The Anglo Americans toppled Mossadegh- a Social Democrat- in Iran so as to keep getting cheap oil from a 'Shah'- i.e. an Emperor. But then the Shah got above himself and persuaded OPEC to jack up prices. Even getting rid of him didn't help coz Ayatollahs came to power. Keynesianism was well and truly fucked each way from Sunday.  The fate of the British Raj had overtaken the Blue Collar Yank. 

 In that environment, unions were the predominant organization aggregating and articulating the interests of a mass coalition and playing a key role in supporting democracy. 

Especially in Vietnam- right? If dominoes start falling, the terms of trade move against the Teamsters and Joe Lunch-pail's standard of living might fall. 

In the post-industrial period, the Republicans actively weakened unions “directly”—through political decisions—

like preventing them using monopoly power to extort money from all and sundry

but they were also weakened “indirectly” as a by-product of economic policies, which Democratic administrations also sometimes adopted.

because Democrats have to live in the country too. Letting the Unions fuck everybody over means they too get fucked. 

 The key pro-democracy coalition became fragmented.

In the way that the key pro-democracy coalition of rapists and muggers gets fragmented when muggers rob rapists or rapists sodomize muggers. 

The Biden administration’s more recent turn to a pro-union orientation is a step in the right direction in building a broad coalition for democracy (though Congress might end up stifling even the most incremental pieces of labor legislation).

Will Unions spend a lot of money on organizing? Perhaps. They have a business model like anybody else. But it must compete with other business models. Arthur Miller- the death of a salesman guy- tells as story of a Union guy who got on the wrong side of Lucky Luciano and had to lie low. Later he was able to get back in the game in the garment sector. But his old adversaries sneered at him. They were going bankrupt in any case. So the Union guy became a salesman for some sweat shop and proved so good at his new job that he became very rich. Still, he'd give money to various stupid Lefty causes. Come to think of it, Miller's dad- an illiterate immigrant- had become a millionaire before the Wall Street crash. If only he had invested in Hollywood, Miller could have fucked not just Marilyn Monroe but fresh talent on a weekly basis. 

Regardless, the reality is that unions are unlikely to return to their historic role in a post-industrial era,

because workers won't pay more in dues then they get in pay increases. This is simply a bad business model. All that can happen is some type of enterprise union which knows about Labor Econ and incomplete contract theory and how to raise productivity and get a share of capital gains and so forth. But stuff like that would happen anyway at the margin.

 in which anti-labor policy has been ratcheted up over decades 

because it was shit

and the structure of the workforce has so changed with the nature of the global economy. 

which wasn't shit at all. Global stuff just kept getting better and better.

The challenge is to build an organizational basis for a mass pro-democracy coalition across many fragmented interests—

this involves actually doing some organizing- not writing shite for the Boston Review

a coalition that understands that democratic institutions are its best chance to achieve the good life, advancing equality in terms of both economic and racial outcomes. 

Why stop there? Why not build an organizational basis for a good after-life? If you can con people into thinking that an Earthly Paradise is possible why not go the extra mile and get them to buy into a perfect after-life where everybody has sex with the super-star of their choice regardless of distinctions of race, class, gender or ontological status? For me, this would involve heavy petting with She-Hulk. 

There is as of yet no clear path to this outcome, but the first step is to recognize it

Very true. To save Democracy we must all build an organizational basis for my blissful marital life with She-Hulk- if not here on Earth then in that perfect world we can all commit ourselves to one day clearly envisioning beyond the borders of Reality.