Beyond Capitalism

Umair Haque has an interesting post up at the Harvard Business Review asking whether Marx was in fact correct about capitalism – not about communism mind you, but about capitalism. Marx, after all, did not simply prescribe a solution, he also put forth a critique of capitalism that Haque thinks might be more applicable to the modern era than we would expect. He approaches this from six of Marx’s prophetic angles: immiseration, crisis, stagnation, alienation, false consciousness, and commodity fetishism.

The long and short of it is fairly straightforward: American workers have seen their wages stagnate even as productivity has increased rapidly, while overall labor’s share of income has fallen drastically compared to those at the top. Meanwhile, capitalism “would be prone to chronic, perpetual crises of overproduction — for they wouldn’t have the means to purchase or invest in enough goods to keep the economy humming.” See, e.g. the last ten or twenty or thirty years, but especially the last ten and the growing debt the dwindling middle class has wracked up.

Then comes stagnation:

Here’s Marx’s most controversial — and most curious — prediction. That as economies stagnated, real rates of profit would fall. How does this one hold up? On first glance, it seems to have been totally discredited: corporate profits have broken through the roof and into the stratosphere. But think about it again, in economic terms: Marx’s prediction concerned “real profit,” not just the mystery-meat numbers served up by beancounters, and chewed over with gusto by “analysts.” When seen in those terms, Marx might be said to have been onto something: though corporations book nominal profits, I’d suggest a significant component of that “profit” is artificial, earned by transferring value, rather than creating it (just ask mega-banks, Big Energy, or Big Food). I’ve termed this “thin value” and Michael Porter has described it as a failure to create “shared value.”

While the economy stagnates and real wages fall, workers begin to feel alienated, lacking meaning or purpose in their work. To make matters worse, even though wages have stagnated, inequality has increased, and workers are alienated we all still operate under the pall of false consciousness, unaware of their own exploitation. Haque asks: “How’s Marx doing on this score? You tell me. I’ll merely point out: America’s largest private employer is Walmart. America’s second largest employer is McDonald’s.”

The whole thing is worth a read.

So if Marx is right about capitalism – not necessarily free markets, mind, but we don’t and probably never will have a truly free market system – but if he’s right about capitalism as it is in practice then what’s to be done? Marxist communism is about as likely as a truly free market society, so that’s out. As I noted recently, some writers are looking to get past the notion of jobs and wage labor altogether (or as much as possible). This isn’t a bad idea, especially given that we’ve been in a long hiring recession that predates the current crisis.

Which brings us to the question of how? How do we go beyond capitalism, or beyond jobs? How do we devise a society that is less immiserating, less alienating, but also not economic suicide?

My problem with the libertarian answer – further deregulation, less government, etc. – is fairly simple. It is unlikely that we can become very much more libertarian as a society, and quite likely that starving the beast even further will simply starve its good parts rather than the bad. In other words, we’ll get the Tea Party vision of America: privatized schools, slashed public benefits, and a really big military and police force, plus more government in the bedroom. I say this is the likely outcome of libertarianism not because this is what libertarianism actually stands for, but simply because it’s the only real example we have of a libertarian movement that goes beyond the general neoliberal push of the last thirty or so years.

That push was a mixed bag, I think. Doing away with wage and price controls is a net good. Doing away with the social safety net seems to be the work-in-progress, however, and I imagine that will end badly.

I guess my thinking is headed in this direction: keep working to free markets, end stupid licensing programs, end the war on drugs, etc. All this stuff is broadly “libertarian” or civil libertarian. All of this is on the one hand.

On the other hand, work to radically improve the welfare state. I don’t mean just make it more efficient, I mean make it much better, more expansive, more redistributive. Go toward something reminiscent of the social democracies of northern Europe. Make work less important to wellbeing. Give workers more autonomy and more agency. Give people more dignity through programs that allow them more time with their kids, more time outside, etc.. Longer maternity and paternity leave, universal healthcare, non-car transportation options, and so forth. A forty hour work week instead of an eighty hour work week.

The question will of course be “What do you think people are entitled to?” and the libertarian answer is predictable. Libertarians believe, to various extents, that taxation is theft or coercion and that any wealth transfer is tantamount to state-sanctioned robbery. The “winners” are being punished by the government, their hard-gotten property transferred at gunpoint to the “losers”.

My answer is this: Society is a compromise. We elect to stay here instead of fashioning Galt’s Gulch in the sea because we are compromising with our democratic peers, electing to stumble through the democratic process. So we pay taxes on things both good and bad and then stumble through the democratic process yet again to make things a tiny bit better. Or much worse, depending on how we bungle democracy. And we do bungle it, very frequently. We bungle other systems worse because they tend to have even more systemic risk.

In any case, it doesn’t matter what people are entitled to, and we’ll never agree on that anyways. In the great democratic compromises that fashion society we make choices about what is best and most practical and most humane. To me this means we do our best to end harmful policies first, but also to craft helpful policies second. So end the war on drugs, but also work toward a society that frees us “from the domination of poverty, violence, culture, prejudice, hunger, ignorance, exploitation and so on and so forth.” Free markets vs. command and control is a false choice.

There is a debate ongoing between various liberal bloggers about the best way forward to achieve this goal. There is the globalize-grow-give sort of neoliberalism approach on the one hand, and the anti-pity-charity pro-labor liberalism on the other. I confess, I’m not sure this division is nearly so cut and dry as I once thought. It strikes me that if we are to really achieve at once a prosperous and egalitarian society you basically need to do both. The middle class needs to grow alongside the rest of the economy. Wages need to grow alongside corporate profits. If we want an economy less centered on jobs, with more opportunity to exit wage labor and stay home with the kids or work in the gig economy or whatever you want to call it, we’ll need a much more robust safety net. We’ll need to create positive labor scarcity, as Ned Resnikoff has argued. Again, this is going back to the ‘market socialism’ concept, and the idea that you can use both public institutions and markets to achieve stated goals.

The economic horizon is gloomy, even beyond the recession. While some goods and services will become cheaper, the nature of our economy will change so that on one end the rich are wealthier and more politically powerful than ever and on the other end the service workers exist in a sort of bread and circuses economy of their own; and very little in the way of a middle class will exist in between. Middle class professional jobs are just the latest to ship overseas or become replaced by technology. As noted above, the largest employers in the country are now Walmart and McDonalds. I don’t think this is a sustainable long-term economic agenda.

In response to this I think there is a strong case that alongside a reasonably free market we need a combination of public welfare programs, public institutions, and middle-class government jobs to strengthen and bolster the long-term viability of the middle class. Inequality will always be with us, but if we hope to avoid the sort of inequality that leads to social unrest, the redistributive state is a necessity. Why is this a bad deal? Why is this a worse deal than the status quo and its web of corporate subsidies, war-making policies, and wealth transfers to the rich? I propose freer markets than the ones we have, an economy as deregulated as say…Denmark or Singapore. Meanwhile, let’s copy some of the social welfare concepts from Denmark and Singapore and make our welfare state more humane.

In short, let’s quit thinking only in terms of productivity and growth, and start thinking about how we invest in human beings. This isn’t to say that productivity and growth are unimportant – quite the contrary – but they are not the only considerations, and I think sometimes our hyper focus on growth, on profits, on the immediate, obscures longer horizons.

Once again, I don’t pretend to have the answers here so much as I have a lot of questions. If a lot of this feels more like intuition than a well-researched-exposition on a New Way forward, that’s because I’m still very much in the weeds.

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142 thoughts on “Beyond Capitalism

  1. Erik:

    Here’s what blows my mind. Marx was obviously right about Capitalism back when he first wrote about it. Pretty much everything he predicted would happen, did happen, with the sole exception (as John Gray pointed out in the other link) that it didn’t die.

    The reason, of course, is that the Western liberal democracies adapted Capitalism, mostly through Social Democracy, to make it so Marx was no longer right about those things.

    And after all that, the Galtian overlords and their silly high-profile spokespersons like Ron Paul want to GO BACK to exactly when we already know Marx was right the first time 140 years ago. Let’s do Hurricanes like we did in 1904. Let’s go back to Lochner says George Will.

    It’s amazing when you think about it. Do these people think Social Democrats put boundaries on Capital just because, you know, it was fun?

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  2. I just wish that libertarians would stop with this “barrel of a gun” business. The fact that the United States does not have an exit visa requirement is not a small point. The smug “if you don’t like it, go to Somalia” rejoinder may be a little … smug, but there is something behind it.

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        • the right ruins more places than the left does. Then again, America’s strength has always been science. This century, that means Brain Drain. Which shows signs of stopping… Not the least cause of which is the republicans deliberate defunding of science for political reasons (everything from herpes research, to climatology, to engineering).

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      • If you want to live in a country devoted entirely to the welfare of the top 1%, move the Galt’s Gulch. And if the old hag in charge wants to sleep with you, reflect on all the economic freedom you gain for that price.

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      • No, we can also tell them to move to France, Germany, Sweden, Italy, Spain, Japan, Canada, Australia…. just about any industrialized nation in the world. As a person who is trying hard to get my (literally) mom and pop biz off the ground, I can tell you flat out, our health care system is the worst in the world. Not because of the treatment (which is good to great) but because of how we fund it. We pay twice as much as a % of GDP as any other country for the same coverage and even worse, biz has to do it. It is very expensive and time consuming to do it. It is infuriating that I have to spend so much of my thin capital (both time and money) on something that I only have buy here in the good old USA. Health care cost may not matter too much to the big boys but it is a huge tax on small biz, you know the people who are suppose to create all the new jobs. It is a huge penalty paid only if you are a start-up in the USA.

        No, going without health care is not an option for me or my family.

        And yes, I will take the higher taxes because taxes are only paid on profit and right now, making profit and having to pay taxes on it is a good problem to have.

        Moving myself and my biz to Canada is plan D. I have several things I want to try before I go that route but if health care cost keep rising and it becomes the difference between making it or not making it, I am out of here.

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        • Jib,
          know a lot of smallbusinessmen. They’re all in the same boat as you are. ‘Course, so is GM and Big Auto — they pay more than the rest of the world in health care, and they ain’t happy about the decreased competitiveness.
          Hope this health reform thingummy helps! (at least it will get a chance… Thelma and Louise are retired.)

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  3. Sadly, I think you’re making the mistake I usually make myself when discussing social and economic policy online: You assume utilitarianism as a common frame for the debate. The 2011 model-year libertarians and conservatives rarely agree with this assumed framing, and insist on theory and dogma over pragmatism and empiricism.

    Pointing out that many European and Asian countries manage to have a higher degree of economic and personal freedom than we do while simultaneously providing universal health care and a strong public education system just doesn’t parse; America is the one and only Home Of The Free, and everywhere else is either a tyranny or socialist race-to-the-bottom hellhole, facts be damned.

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    • – pragmatism looms very large in my thinking lately, I admit. Ideology, theory – these are deeply alluring, but also fundamentally flawed on their own. Ideology is inevitably tempered by political realities; theory watered down by pragmatism. So it goes.

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    • “Sadly, I think you’re making the mistake I usually make myself when discussing social and economic policy online: You assume utilitarianism as a common frame for the debate. The 2011 model-year libertarians and conservatives rarely agree with this assumed framing, and insist on theory and dogma over pragmatism and empiricism.”

      Much of the debate is centered on what works best, and what is more pragmatically beneficial — government spending on stimulus or reducing taxes, government central planning and regulations so that the private market can function. To frame the latter as rigid ideology while praising the former as ultilitarian and pragmatic is political spin. I wish the Republicans were more steeped in theory and ideology, but the candidates are basically making utilitarian and pragmatic arguments — they just happen to disagree on what works best. Republicans will quickly ignore libertarian theory in favor of pragmatic tweaking — Romney just wrote a 160 pages of basically utilitarian tweaks. Ron Paul is probaly the only candidate true to an ideology.

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      • Except that’s largely *not* the debate we’re having in this country.

        When you have large, influential factions that refuse to engage with facts and figures and reduce every policy debate down to just a few immutable dogmatic principles you’ve left the realm of pragmatism.

        When Republicans enter any discussion of economic policy with the idea that all taxes must go perpetually down and military spending must go perpetually up you’re not arguing a different utility function, you’re arguing religious dogma.

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  4. Can I tell people “I think we live in a country that is supposed to be ruled by the majority of the people and I think it would be better to have a medical system similiar to Germany’s and am doing everything possible to talk enough people into it to have that become law, and if you don’t like that, you can move or stay”.

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    • You can tell people whatever you want, dude.

      If you are unwilling to hear answers such as “and I’m trying to talk them out of it because the cost of being like Germany includes such things as being like Germany”, you don’t get to feign surprise when the bill comes due.

      Ah, I’m just kidding. You should feel free to feign surprise. Blame the bill on the libertarians!

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      • Since the first site I went to about gdp percentage of medical outlays said that Germany spends four percent less than the US, I would like to see that bill. That site also said that Germans live longer and have almost half the infant mortality rate of the US has. If I saw what I construed as a problem and the libertarians were in charge I would blame them, but since I believe the corps are in charge I blame most of America’s problems on them. Also, it would scare the hell out of me if everbody agreed with me about anything. I would think I had died and gone to hell. The thought of living in a world of perpetual yes sir sounds so boring.

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          • Jaybird, I give up. You are right. America is either too greedy or too racist to fix the health care problems in this country. As far as blaming the republicans, I would if I thought they were in control, but I think they work for the corps, so I blame their overlords for the problems.

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              • How much of the difference in health care cost between us, Germany, Singapore, and say, Australia do you think is explainable by differences in culture?

                Are there one or more aspects of American culture that make universal health care here practically impossible? Which one(s)?

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                • I think it’s due primarily to differences in the homogeneity of culture.

                  So it’s not that German Culture is very much like Singaporean Culture… except that German Culture and Singaporean Culture are both very, very homogenous (as compared to, say, the US).

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                  • How do you figure Singapore is more analogous to Germany than the U.S. as far as homogeneity?

                    Singapore is quite ethnically and economically diverse, with a high percentage of immigrants and first- or second-generation descendants of immigrants.

                    That’s also why I brought up Australia. There are plenty of countries with ethnically and culturally diverse populations that have managed to implement health care systems that look a lot more like Germany’s or Norway’s than ours.

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                    • According to the wikipedia, Singapore is 74% Ethnic Chinese, 13% Malay, 9% Indian, and 3% “other”.

                      According to the same, Germany is 81% German with no immigrant background, 10% German with immigrant background, and 8% “Foreigners”.

                      The US has 63% “White” (which is more of a color than a cultural demographic), 12.5% “Black or African-American” (which is more of a color than a cultural demographic), 9% “White Hispanic and Latino American” (which is kind of a cultural demographic), 5% Asian (which, I’ve had some explain to me, says *NOTHING* about culture), and so on.

                      Is there reason to believe that the 74% Ethnic Chinese in Singapore is as culturally diverse as “White” is in the US given Singapore’s population of five million and size and density (Just under 19k per square mile)?

                      Germany might be a bit easier, given that it’s 80 million in a *LOT* more space (just under 600 per square mile).

                      The US has 312 million… and an average of just over 87 per square mile. 87.4.

                      To be honest, I think that India or China (or the entire EU) would make better comparisons to the US for diversity than Singapore or Germany.

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                    • Those numbers are for Singaporean citizens, which is about 80% of the population, and doesn’t include the millions of non-citizen guest workers, students, etc.

                      And yes, I think there is a lot of cultural diversity among the Singaporean population, much more than Germany (if perhaps not as much as the U.S.).

                      I also think population density isn’t a very good proxy for cultural homogeneity in a world where mass communications media are the norm.

                      And again I’d nominate Australia as another fairly heterogeneous country. Unless you want to define “heterogeneous” as “looks exactly like the U.S. in every respect” I don’t think it’s terribly hard to find a number of heterogeneous nations with social welfare systems that look a lot more like Germany’s than the U.S.’s.

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                    • So Singapore has closer to 6.25 million instead of 5 million?

                      You’ll forgive me if I see the 1.25 million folks as something that the US would consider a rounding error. (Seriously: That’s about two fifths of a percent of the US population… which is a number that also does not count non-citizen guest workers, students, etc.)

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                    • Look, the whole homogeneity debate is silly. We won’t have the *exact same system* as any European country, no matter what. I suspect it will be due to our political system more than to our homogeneity or lack thereof. It will also be because we have large rural populations, a different geography, etc. Many, many factors apply here. None of them mean that we can’t implement something like single-payer insurance, however. There is no direct line between racial diversity and the inability to implement universal healthcare. Of course it makes it harder to do *politically* but that says very little about whether it’s possible practically.

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                    • I’m not talking about race per se… though I am using race as a proxy for culture.

                      Culture is what I’m talking about here.

                      Cultural homogeneity is very, very important when it comes to the success of a society-wide policy that will prove to be very, very expensive.

                      We don’t have it.

                      I see it as a prerequisite for success.

                      Personally, I’d like it if folks could explain to me why it’s nowhere near as much of an issue as I seem to think it is but I understand that that is, in effect, asking people to cater to me. Which ain’t cool.

                      But if people find themselves with free time…

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                    • Jaybird,
                      Two things with a decent “universal health care”
                      1) Preventative care instead of Emergency care. That’s a 10x savings for everything we catch, minimum. (more if a phone call prevents gangrene).
                      2) Electronic Medical Records — this is permanent savings, in terms of space for paper (costly in a city) and manpower (eliminate the records department).
                      3) Eliminating the large perc that’s spent on evaluating insurance, making sure that insurance will cover it, and chasing down insurance to make sure that they do cover it (“death by spreadsheet”)

                      It’s not like we’re talking a “don’t steal system” where it’s in individual interest to take from the system, but in group interest to give to the system. We’re talking about a system where the cost-rewards are inherent.

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              • The same way that gays and lesbians are slowly but surely getting all the rights that straight people have, one mind at a time. Sure, it is a slow laborious process, but I do have the rest of my life to accomplish that feat.

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                • I think it’s much easier to get people to agree to “leave people alone” rights than it is to get them to agree to “take care of other people” rights when it comes to heterogeneous systems.

                  I look forward to you attempting to prove me wrong and then blaming me for it not working.

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                  • If only people would go along with the plan. Something will have to done about recalcitrance, because such a social plan will not work unless there’s a social contract with enough people in agreement to coerce the ones who disagree. Isn’t this basically how progressive advancement works?

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                    • We’ll also need to restrict mobility, so that wealth creators don’t move wealth out of the sovereign’s reach. There will need to be some sort of punish and reward system to make sure that the most productive in society aren’t discouraged from producing, thus joining those who desire to “freelance” or become stay-at-home child-rearers.

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                    • The problem with this line of argument, Mike, is that we basically already have a very mixed economy and the parts where people are given things like food stamps or medical care are quite literally the least harmful parts of that system. In fact, you could easily keep or expand those parts, and still make leaps and bounds in the “leave people alone” department. I can never really understand why any libertarian even gives a shit about Social Security or Medicare or any of that while wars rage, prohibition and mass incarceration continue apace, and so forth. Priorities!

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                    • What you are proposing is not a difference in degree but a difference in kind. And, why can’t we be concerned about all of it? Who says we’re more concerned about SS than wars and foreign intervention? In your attempt to make libertarians look like social meanies, you aren’t making sense — you aren’t describing libertarians, but something you’ve manufactured.

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                    • Mike – how am I making libertarians look like meanies? I’m saying that I don’t think actual libertarianism is very likely, and that something else will masquerade as libertarianism, speak its language, take its shape, but have far worse consequences.

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                    • “I’m saying that I don’t think actual libertarianism is very likely, and that something else will masquerade as libertarianism, speak its language, take its shape, but have far worse consequences.”

                      Why do you say this? I could say that about liberalism or progressivism or conservatism or socialism, that none of them are possible, but I’d have to make a damn good case to make sense.

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                    • Mike Farmer – I say this because what you demand is more radical than what I demand. You want to abolish the welfare state entirely. That’s a much larger leap than my hodge-podge of deregulated markets + robust welfare state. I’m asking for a mixed economy to stay mixed but get more free on the one hand and more socialist on the other. You want a minarchist state. Your idea, I believe, is less pragmatic – which, by the way, says nothing of the merits of the ideas themselves. I respect your ideas, I just disagree with the feasibility of their implementation.

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                    • The combination of socialism and free market is only a means to completely destroy free markets, so I would say that a free market sans socialism is far more pragmatic if the goal is across-the-board human flourishing. Regardless, we’re on the verge of a true Reagan Revolution – one without the moderating effect of Reagan. Reagan was one personality against a powerful State machine, and the machine won. It will take a wide and deep change in representation willing to truly limit government, and a public which finally realizes our answers don’t lie in government solutions — this appears to be materializing. I think the change among young people is unreported, and I can’t help but feel that the opinions of young thinkers here are not representative of young people in general. I might be wrong, but I don’t think so. Once the public’s imagination is challenged, and they begin thinking outside the State box, many great changes are possible. The welfare state is out of touch and insufficient to meet the needs of the 21st century.

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                  • Jaybird, I think you are right, it is easier to get people to leave people alone in a heterogeneous system, but just because I don’t think there is an utopia, it in no way negates my need to try and reach it. As far as blaming you, when did you get any power?

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        • We have been over these statistics many times.

          Are the longevity statistics corrected for deaths due to violence?

          And the babies of rich white Americans don’t die any more than the babies of rich white Germans, but there are a lot more poor blacks and poor hispanics in America than there are in Germany.

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          • I’ve spent a bit of time trying to get clean infant mortality stats. The US calculates them differently [and we save a lot more preemies, iirc], so comparisons are difficult if not impossible. And yes, there are race/culture disparities in all our stats, too. Near as I can make it, a Japanese American woman has the same health outcomes as a Japanese national. This proves much, or nothing, depending on your epistemological or ideological stance.

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        • When it comes to health care, Singapore is to Europe as Europe is to the US, at least as far as expenditures and life expectancy are concerned. So why is the left always talking about Europe instead of Singapore?

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          • Objection; assumes facts not in evidence.

            “The left” doesn’t much talk about anything with one voice. The alleged obsession with turning the U.S. into Europe is largely a fairy tale spun out of whole cloth by right-wing commentators.

            Nor is Europe a singular entity for comparison. Switzerland’s health care system is very different from Italy’s or Norway’s, and very, very different from Britain’s.

            Among actual left-leaning health care policy wonks, you’re just as likely to see comparisons with Japan, Singapore, Hong Kong, Australia, and a ton of other countries as any individual European nation.

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  5. Mises:

    There are people to whom monetary calculation is repulsive. They do not want to be roused from their daydreams by the voice of critical reason. Reality sickens them, they long for the realm of unlimited opportunity. They are disgusted by the meanness of a social order in which everything is nicely reckoned in dollars and pennies. They call their grumbling the noble deportment worthy of the friends of the spirit, of beauty, and virtue as opposed to the ignoble baseness and villiany of Babbittry. However, the cult of beauty and virtue, wisdom and the search for truth are not hindered by the rationality of the calculating and computing mind. It is only romantic reverie that cannot survive in a milieu of sober criticism. The cool-headed reckoner is the stern chastiser of the ecstatic visionary.

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  6. What you’re describing sounds an awful lot to me like the strawman that conservatives have in mind when they think they’re criticizing libertarianism. You’re free to use drugs, and if you can’t hold a job down because you keep showing up to work high, we’ll bail you out. You can have sex with whoever you want, and if you have a child you can’t afford, we’ll bail you out. If you contract HIV, we’ll bail you out. If you gamble away your mortgage payment or retirement savings, we’ll bail you out.

    Maximization of moral hazard just isn’t a good principle around which to organize a society.

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    • Brandon – not at all. My opinion on the theory of libertarianism is quite positive, actually. My problem, and my description here, is how I see libertarianism playing out *in practice*.

      Furthermore, while I agree that maximization of moral hazard can be very bad, providing things like universal healthcare are hardly the ways I would worry about that happening.

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  7. “In the great democratic compromises that fashion society we make choices about what is best and most practical and most humane.”

    This is most emphatically *not* how the modern mixed economy and welfare state were fashioned, and that’s the issue with this line of thinking. It would be great if we could shape our public policies to a set of morals that moves beyond individualism or materialist egalitarianism (which are probably flip sides of the same coin.)

    Perhaps European countries, with their greater degree of cultural homogeneity, have a stronger set of common values (and more social trust) to build on, making such an enterprise possible. But America is a large, polyglot commercial republic — and the nature of our state reflects the fact that policy-making here is a nasty, selfish, incoherent, ad hoc business. Personally, I think a great deal of self-described conservatives and libertarians actually have no truck with the sort of heroic, secular, Randian individualism that appears to dominate the discourse of what can generally be called the “Right.”

    But the conseqeuences of failing to hold the line on individualism and limited government are not likely to be a “One Nation”/”Red Tory”/”Eisenhower” sort of thing, nor will it be an authentically Jeffersonian turn, characterized by empowering populist localism. These things would restore dignity and quality of life to people, but they are not likely to come to pass.

    What’s more likely to come to pass are petty, distributive log-rolls, that create further labyrithine bureaucracies, entrench the state as mechanism for picking winners and losers, and increase the burden that public functions place on private actors and institutions, while making no positive, coherent changes to our culture. When faced with this eventuality, doubling down on the myth-making of “rugged individualism” looks much more attractive.

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  8. Haque asks: “How’s Marx doing on this score? You tell me. I’ll merely point out: America’s largest private employer is Walmart. America’s second largest employer is McDonald’s.”

    This is painfully sloppy thinking. The fact that they’re the largest employers doesn’t mean that they’re typical employers. In fact, they’re pretty obviously atypical by virtue of being the largest. That doesn’t necessarily mean that their jobs are atypical, but they are. In fact, Wal-Mart in particular, but also McDonald’s to some extent (“McJobs”) are considered by many on the left to be uniquely bad employers.

    Both are national chains with a business model built around extensive utilization of low-productivity labor. Naturally these jobs are going to be at the low end of the compensation spectrum.

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        • Don’t confuse outcomes with intent.

          Panicky stupid rich folks make bad engineers. Put another way: I’ve seen *nothing* to indicate that *anybody* has the Evil Overlord skills required to pull off such a scheme. People that run companies have a fishing hard time keeping them from flying off the rails, they’re certainly not competent enough to pull this stuff off intentionally.

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          • … yes, yes, the revolution is coming. and there will be fire and brimstone.
            … well, it came all the other times, right? (french revolution)

            (What do you need to be an evil overlord? The ability to blackmail people? The ability to hold captive luscious women? What am I forgetting that fits in your criteria, that the rich don’t already do?)

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      • No, because I don’t think that that’s a valid interpretation of the fact pattern. I don’t think that McDonald’s and Wal-Mart are taking people who would otherwise be engineers or mechanics or accountants and forcing them into low-productivity jobs. This is the stuff of left-wing fairy tales.

        They’re taking people who otherwise would not be doing much of anything useful, because they lack marketable skills, because they’re retired, because they’re students who can only work part-time, and/or because they live in places where there just aren’t any better opportunities, and giving them something productive to do.

        These are underutilized segments of the labor market, as evidenced by their low rates of employment, and the fact that companies like McDonald’s and Wal-Mart have found ways to utilize them effectively is a very good thing for everyone involved. People who wouldn’t otherwise have jobs have them, consumers get lower prices, taxpayers get a break from supporting the unemployed, and shareholders profit. This is a success of capitalism, not a failure.

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  9. One interesting thing about German Homogeneity:

    Germany split into West and East Germany. After a few decades of social experimentation, they decided that they very, very much wanted to be one country again.

    Let’s say that we split the US.

    How likely is it that the two countries want to join? (If we split it down the middle, does that change the answer from if we split it across the middle? Would separating Germany into North and South Germany have changed anything?)

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  10. A human being needs a suite of goods in order to live an acceptable life.

    We might quibble about what constitutes that suite — an adequate supply of wholesome and nutritious food, ready access to clean water, sanitation facilities, shelter and clothing appropriate to the climate, and freedom from crime seem like they would be the rock-bottom minimums. Some might include access to health care, political empowerment, literacy and/or education, transportation, and so on.

    Much of the economy is still centered around producing these goods and services, and delivering them to people. Modern technology has made it possible to overcome the production and logistical feats necessary to get these things to consumers with substantially less human labor than had been required in even the early and middle industrial eras.

    Because we need relatively fewer people to make and distribute more stuff, that frees up more people to engage in luxury activities. Like academia or the arts or finance or (some of) the learned professions.

    It is not difficult to imagine the curve cotninuing to bend, and more goods and services get out into the economy with even less labor involved in the future. If literally every man, woman, and child on Earth were able to obtain, with relatively low cost, the suite of goods and services necessary for a human to thrive, employing only (say) 1% of the total population of the planet, what would the other 99% of us do? Sculpt and blog all day long?

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    • Right – this is kind of the point of my thinking in the last couple of posts. Is it possible that we will reach a point where we simply don’t need a bunch of labor since we’re able to produce most everything without it? And if so, are we better off just letting people go unemployed, or finding something else for them to do – even if it’s just menial stuff like “raising kids” or making art or whatever.

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      • Yes, I think those concepts are related. Heritage used a flawed study and suggested a conclusion even more flawed than that. But the concept (how poverty is defined has changed with the advance of technology and time) is worthy of consideration.

        For the record, I do not subscribe to the idea that “there are no poor people in the USA,” especially not if your evidence for that is a proliferation of refrigerators. Nor am I willing to subscribe to the idea that being poor does not suck all that much because there is an air-conditioning unit in the slummy apartment you rent, so as to keep your cockroach roomates cool in the summertime.

        But I am willing to consider the idea that what it means to be poor in 2011 in terms of the fulfillment of material needs is different than what it was to be poor in 1911.

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