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economics
A Different 'Abundance Agenda': Avoiding Delusions and Diversions
If there is to be a decent human future—perhaps if there is to be any human future—it will be fewer people consuming less energy and creating less stuff.
Mar 30, 2025
For the next few weeks, the buzzword in US debates on the liberal/left about economics and ecology will be “abundance” after the release of the book with that title by Ezra Klein (New York Times) and Derek Thompson (The Atlantic magazine).
The book poses politically relevant questions: Have policies favored by Democrats and others on the political left impeded innovation with unnecessary red tape for building projects? Can regulatory reform and revitalized public investment bring technological progress that can solve problems in housing, infrastructure, energy, and agriculture? The book says yes to both.
Those debates have short-term political implications but are largely irrelevant to the human future. The challenge is not how to do more but how to live with less.
All societies face multiple cascading ecological crises—emphasis on the plural. There are many crises, not just climate change, and no matter what a particular society’s contribution to the crises there is nowhere to hide. The cascading changes will come in ways we can prepare for but can’t predict, and it’s likely the consequences will be much more dire than we imagine.
If that seems depressing, I’m sorry. Keep reading anyway.
Rapid climate disruption is the most pressing concern but not the only existential threat. Soil erosion and degradation undermine our capacity to feed ourselves. Chemical contamination of our bodies and ecosystems undermines the possibility of a stable long-term human presence. Species extinction and loss of biodiversity will have potentially catastrophic effects on the ecosystems on which our lives depend.
Why aren’t more people advocating limits? Because limits are hard.
I could go on, but anyone who wants to know about these crises can easily find this information in both popular media and the research literature. For starters, I recommend the work of William Rees, an ecologist who co-created the ecological footprint concept and knows how to write for ordinary people.
The foundational problem is overshoot: There are too many people consuming too much in the aggregate. The distribution of the world’s wealth is not equal or equitable, of course, but the overall program for human survival is clear: fewer and less. If there is to be a decent human future—perhaps if there is to be any human future—it will be fewer people consuming less energy and creating less stuff.
Check the policy statements of all major political players, including self-described progressives and radicals, and it’s hard to find mention of the need to impose limits on ourselves. Instead, you will find delusions and diversions.
The delusions come mainly from the right, where climate-change denialism is still common. The more sophisticated conservatives don’t directly challenge the overwhelming consensus of researchers but instead sow seeds of doubt, as if there is legitimate controversy. That makes it easier to preach the “drill, baby, drill” line of expanding fossil fuel production, no matter what the ecological costs, instead of facing limits.
The diversions come mainly from the left, where people take climate change seriously but invest their hopes in an endless array of technological solutions. These days, the most prominent tech hype is “electrify everything,” which includes a commitment to an unsustainable car culture with electric vehicles, instead of facing limits.
There is a small kernel of truth in the rhetoric of both right and left.
When the right says that expanding fossil energy production would lift more people out of poverty, they have a valid point. But increased production of fossil energy is not suddenly going to benefit primarily the world’s poor, and the continued expansion of emissions eventually will doom rich and poor alike.
When the left says renewable energy is crucial, they have a valid point. But if the promise of renewable energy is used to prop up existing levels of consumption, then the best we can expect is a slowing of the rate of ecological destruction. Unless renewables are one component of an overall down-powering, they are a part of the problem and not a solution.
Why aren’t more people advocating limits? Because limits are hard. People—including me and almost everyone reading this—find it hard to resist what my co-author Wes Jackson and I have called “the temptations of dense energy.” Yes, lots of uses of fossil fuels are wasteful, and modern marketing encourages that waste. But coal, oil, and natural gas also do a lot of work for us and provide a lot of comforts that people are reluctant to give up.
That’s why the most sensible approach combines limits on our consumption of energy and rationing to ensure greater fairness, both of which have to be collectively imposed. That’s not a popular political position today, but if we are serious about slowing, and eventually stopping, the human destruction of the ecosphere, I see no other path forward.
In the short term, those of us who endorse “fewer and less” will have to make choices between political candidates and parties that are, on the criteria of real sustainability, either really hard-to-describe awful or merely bad. I would never argue that right and left, Republican and Democrat, are indistinguishable. But whatever our immediate political choices, we should talk openly about ecological realities.
That can start with imagining an “abundance agenda” quite different than what Klein and Thompson, along with most conventional thinking, propose. Instead of more building that will allegedly be “climate friendly,” why not scale back our expectations? Instead of assuming a constantly mobile society, why not be satisfied with staying home? Instead of dreaming of more gadgets, why not live more fully in the world around us? People throughout history have demonstrated that productive societies can live with less.
Instead of the promise of endless material abundance, which has never been consistent with a truly sustainable future, let’s invest in what we know produces human flourishing—collective activity in community based on shared needs and reduced wants. For me, living in rural New Mexico, that means being one of the older folks who are helping younger folks get a small-scale farm off the ground. It means being an active participant in our local acequia irrigation system. It means staying home instead of vacationing. It means being satisfied with the abundant pleasures of this place and these people without buying much beyond essentials.
I’m not naïve—given the house I live in, the car I drive, and the food I buy from a grocery store, I’m still part of a hyper-extractive economy that is unsustainable. But instead of scrambling for more, I am seeking to live with less. I know that’s much harder for people struggling to feed a family and afford even a modest home. But rather than imagining ways to keep everyone on the consumption treadmill, only with more equity, we can all contribute ideas about how to step off.
Our choices are clear: We can drill more, which will simply get us to a cruel end game even sooner. We can pretend that technology will save us, which might delay that reckoning. If we can abandon the delusions and diversions, there’s no guarantee of a happy future. But there’s a chance of a future.
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Trump’s Plan for Gaza Would Make Colonial Plunder Great Again
In an interview, economist James K. Boyce discusses the relationship between war and economics, and how Trump’s talk of taking over Gaza and turning it into the “Riviera of the Middle East” is similar to the U.S. dispossession of Native Americans.
Feb 27, 2025
Can economics fuel conflict and war? Absolutely, and history is full of such examples. But economics can also pave the way to lasting peace, according to progressive economist James K. Boyce.
In the interview that follows, professor Boyce discusses the economics of war and the role that economics can play in peacemaking, including in places like Ukraine and Gaza, although he acknowledges that daunting challenges lie ahead for these two war-torn areas of the world. As for U.S. President Donald Trump’s plan for Gaza, Boyce puts it side by side with the dispossession of Native Americans in the United States.
James K. Boyce is professor emeritus of economics at the University of Massachusetts Amherst and a senior fellow of the Political Economy Research Institute (PERI). He is the author of Investing in Peace: Aid and Conditionality after Civil Wars and editor of Peace and the Public Purse: Economic Policies for Postwar Statebuilding and Economic Policy for Building Peace: The Lessons of El Salvador. He received the 2024 Global Inequality Research Award and the 2017 Leontief Prize for Advancing the Frontiers of Economic Thought. This interview is based on his seven-part video series released by the Institute for New Economic Thinking.
C. J. Polychroniou: Conflicts across the world have surged since 2020, making this one of the most violent periods since the end of the Cold War. The wars in Ukraine and Gaza have been most visible in the news, but there have been dozens of other conflicts, too. What lessons can we draw from history about the economics of war, the topic of your recent video series from the Institute for New Economic Thinking? How about if we start with the wars of conquest during the era of colonialism?
James K. Boyce: Economics is not just about mutually beneficial exchanges entered into by mutually consenting adults, though you could be forgiven for thinking so if your only acquaintance with the subject was a typical textbook. Real-world economics also is about coercive relationships in which one side benefits and the other loses. Such interactions—which can be grouped under the general rubric of plunder—involve not only outright force but also the manipulation of governments and markets, often occurring in the grey area between what is legal and what is not.
Trump often is described as “transactional” with good reason: For him, policy is about making deals.
The colonial wars of conquest were a particularly naked example of plunder. Slavery, the appropriation of lands and minerals, and the monopolization of commerce were common features of the time, thinly cloaked, if at all, by the pretense of a “civilizing” mission. But it would be wrong to imagine that plunder disappeared with the end of formal colonial rule. It remains a ubiquitous feature of the world economy, now sometimes cloaked by the veneer of “modernization” or “development.” Because plunder is inherently antagonistic—it pits the plunderers against the those whose resources and livelihoods are plundered—it can and often does morph into violence and war.
C. J. Polychroniou: What about more recent conflicts, like the wars in Bosnia (1992-1995) and Afghanistan (2001-2021)? How did economics figure into these?
James K. Boyce: Economics is not the whole story in these or most conflicts, but it is an important part of why they begin, how long they persist, and how they finally end.
Bosnia emerged as an independent nation during the breakup of Yugoslavia in the 1990s. Some commentators blamed “ancient ethnic hatreds” for the violence that accompanied Yugoslavia’s dissolution, but tensions arising from economic disparities among its provinces were also at play. Within Bosnia, three main “ethnic” groups lived side by side—Muslim Bosniaks, Catholic Croats, and Orthodox Serbs—and the fighting largely devolved along these lines (I place “ethnic” in quotation marks, because apart from religious origins the three were hard to distinguish). But another underlying axis of conflict was the deep economic gulf between urban Bosnians (often Bosniaks), who benefited in Yugoslavia from good education, health, and pension systems, and rural Bosnians (often Serbs), who were excluded from the benefits of engagement in the formal economy.
Once war broke out, opportunities for plunder became a key driving force in the conflict. Hardliners who engaged in ethnic cleansing—killing minorities and driving them out—not only sought to establish homogeneous enclaves for “their” people but also to gain personally from seizing the businesses, homes, land, and other property the victims left behind.
Economic incentives, in the form of promises of postwar reconstruction aid, played a key role in the end of the war, too, persuading the warring parties to sign the 1995 Dayton Peace Accord. Dayton, in a sense, was an aid-for-peace bargain. So economics was very much implicated in all phases of the Bosnian conflict.
The 2001-2021 war in Afghanistan was in many ways a resumption of the 1979-1989 war, with the difference that now it was the United States instead of the Soviet Union that occupied Kabul while the countryside largely remained under the control of the Taliban and regional warlords. As in Bosnia, pronounced economic disparities between urban and rural areas fueled the Afghan conflict, and the Taliban tapped into rural discontent. Wide disparities between Kabul and the rest of the country predated the Soviet and American invasions, and were further exacerbated by the wartime influx of foreigners and their money. Meanwhile, by controlling the opium traffic and taxing cross-border trade, the Taliban built a viable economic base of their own.
Economics played a central role in the U.S. war strategy, but it was not a pretty picture. In 2002, then-U.S. Defense Secretary Donald Rumsfeld instructed his senior aides to come up with “a plan for how we are going to deal with each of these warlords—who is going to get money from whom, on what basis, in exchange for what, what is the quid pro quo, etc.” The U.S. government poured nearly $1 trillion into Afghanistan—$145 billion in reconstruction aid plus $837 billion in military expenditures—this in a country with a GDP of less than $20 billion. War “became the Afghan economy,” as The New York Times put it. The Afghan leadership, unsurprisingly, was more attentive to the demands of foreign donors than to the needs of their own citizens. Massive corruption fueled by external assistance fatally undermined any possibility of building a legitimate and effective state. “Our money was empowering a lot of bad people,” a senior U.S. official recalled. “There was massive resentment among the Afghan people. And we were the most corrupt.”
Today 85% of Afghanistan’s people subsist on less than one dollar a day. Whether the Taliban government or the so-called international community will act to address their deprivation and build a lasting peace is an open question.
C. J. Polychroniou: What role can economics play in peace building?
James K. Boyce: There is much to be said on this topic—it is the focus of the video series—and space precludes a full answer here. Let me highlight just two points.
First, economic policies can either reduce inequalities and the accompanying tensions or exacerbate them. This means not only “vertical” inequality between rich and poor, but also “horizontal” inequalities between groups defined on another basis, such as region, ethnicity, race, or religion. A single-minded focus on the total size of the economic pie—the conventional goals of growth and efficiency—is misplaced when conflicts over how it is sliced threaten to smash the pie.
Second, economic policies can either strengthen or weaken the bargaining power of pro-peace forces vis-à-vis those who seek to perpetuate the conflict. In Bosnia, for example, a crucial postwar issue was the return of refugees and internally displaced persons to their former homes. In some municipalities, local leaders welcomed them; in others, they actively obstructed returns, in part to protect their ill-gotten loot. In its “Open Cities” program, the United Nations High Commission for Refugees used reconstruction aid to reward municipalities that welcomed returns and to induce leaders on the fence to come down on the pro-peace side. The program’s implementation was not perfect, but the idea was sound. Again, “who” matters as much as “what.”
C. J. Polychroniou: How can we apply economics to the wars in Ukraine and Gaza? Can economic policies help to drive peace in those two war-torn areas?
James K. Boyce: The Trump administration’s “America first” stance seems likely to lead to a U.S. pullback from engagement in the tasks of peace building and state building in war-torn societies. In part, this reflects a disillusionment born of the dismal failures in Afghanistan and Iraq, and as those experiences suggest, disengagement may not be entirely a bad thing. But Ukraine and Gaza continue to loom large on the U.S. foreign policy agenda.
Trump often is described as “transactional” with good reason: For him, policy is about making deals. In both Ukraine and Gaza, economic considerations will be a big part of any deals we see. But it is by no means clear that forging a lasting peace will be the top priority for the dealmakers. If not, the end of the current wars could merely set the stage for future ones.
The Ukraine war is exhibit No. 1 of the dangers of fossil-fueled oligarchy. In addition to enormous environmental costs, fossil fuels carry a high political cost: They enable the autocratic rulers of petrostates to govern with little accountability to either their own citizens or norms of international law. Vladimir Putin’s Russia is a case in point. As Ukraine illustrates, fossil fueled-oligarchy can metastasize into fossil-fueled war.
Putin has oil and gas; Netanyahu has the United States.
Oil and gas revenues have sustained the Putin regime, notwithstanding international sanctions. The sanctions do, however, drive a wedge between the world market price and what Russia receives, so the prospect of lifting them could act as an incentive for Russia to accept a negotiated settlement. But if the Trump administration eases the sanctions without a peace agreement, while at the same time cutting military and financial aid to Ukraine, this will tilt the terms of the settlement in Russia’s favor.
On the Ukrainian side, the prospect of large-scale reconstruction assistance—as well as an end to the carnage—may provide an incentive, too. It now appears that the responsibility for funding Ukraine’s postwar reconstruction will fall mainly on Europe; whether the European nations will be willing and able to shoulder this burden remains to be seen. In an effort to shore up U.S. support, Ukrainian President Volodymyr Zelensky has offered a minerals-for-aid deal that would give the U.S. access to Ukraine’s deposits of lithium, uranium, and other critical minerals. But the minerals will be in the ground regardless of who controls the land above them, and it is not evident that the Trump administration will care much about that.
In Gaza, the latest war tragically illustrates what I call the “partition dilemma.” The 1994 Oslo Accord sought to resolve the Israeli-Palestinian conflict by establishing the Palestinian Authority as a step toward a two-state solution. In the short run, partition can be an appealing way to stop the shooting. But in the longer run, it can set the stage for renewed conflict, as demagogues on both sides invoke fear of the other to enlist public support from their own people. Partition severely undermines the viability of leaders and parties that would appeal to pro-peace constituencies on both sides.
It is not surprising that 30 years after Oslo, we find Hamas on one side and the Netanyahu government on the other. The two feed off each other in a de facto alliance, each holding up the other as justification for its own politics of demonization. This helps to explain why the Netanyahu government not only tolerated but actively facilitated the flow of cash from Qatar to Hamas. In a candid moment back in 2015, Bezalel Smotrich, who is now Prime Minister Benjamin Netanyahu’s finance minister, said that “Hamas is an asset.”
The chances that partition will lead to a lasting peace grow even slimmer if one side receives large-scale financial and military support with no strings attached—without peace conditionality—while the other does not. By emboldening one side and embittering the other, the resulting imbalance is a recipe for renewed conflict. Putin has oil and gas; Netanyahu has the United States. Rather than a negotiated settlement, the Israeli government now appears to be seeking a winner-take-all victory. Under the new U.S. administration, Netanyahu will face even fewer constraints than under the last one.
Trump’s talk of taking over Gaza and turning it into the “Riviera of the Middle East” is reminiscent of plunder during the colonial era, including the dispossession of Native Americans in the United States. Yet in purely economic terms it makes a certain amount of sense: Beach resort development would indeed be a more profitable use of the land than maintaining Gaza as a place of confinement for 2 million refugees. Where other politicians see territory, Trump sees real estate.
The problem, of course, is what to do with Palestinians. There is one place that many of them might go willingly: the land of their grandparents, Israel. The fact that option this is unmentionable, even unthinkable, tells us a lot.
If the war in Gaza and ongoing displacement in the West Bank do not end with the complete expulsion or annihilation of the Palestinians—a prospect that still seems inconceivable—the eventual outcome will be a single state in which the surviving Palestinians have a subordinate and marginalized status. Their struggle will then become one for equal rights. Economic policies could prove helpful at that point, but history suggests it will be a long, hard road.
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Kamala Harris, Candidate of Economic Change, Breaks With Old Democratic Thinking
The key question remains: have voters heard her?
Nov 04, 2024
In mid-June I went to Nashville for a reunion of old friends who were activists with the Southern Student Organizing Committee, a group founded in 1964 by young Southerners inspired by the sit-in movement and devoted to dismantling racism all over the South and the nation. Like Martin Luther King Jr., we also went to work to end the war in Vietnam. In Nashville we shared stories about having stood up early—when it was dangerous—for racial justice and against a tragic war.
But today, decades later, we were staring into the vacuum of a terrifying potential disaster: Donald Trump—candidate of fascism and racism, enemy of women’s rights, friend of American billionaires and Russian oligarchs, and the guy who wants to dismantle U.S. democracy—could be (re)elected President.
My old friends—who stood up to George Wallace and Richard Nixon back in the day—were all committed to defeating Trump. But back in June many shared a troubled question about the Democratic incumbent. “Biden did a great job in the White House, but isn’t he too old to make the case against Trump—and for a better future—in this election?” Only a few months later—after Biden bravely stepped away and Kamala Harris and Tim Walz began energetically taking on Trump—celebration and optimism have reigned on our follow-up Zoom calls—because now we had a candidate who could talk with the American people—about making life better for working Americans. And many SSOC veterans, especially those in Georgia and North Carolina, have been working hard to build the movement that we hope will win in those key swing states.
Clearly, the Harris team (and Democratic operatives) have made saving democracy and reclaiming abortion rights as their key issues. When your opponent is a self-declared fan of Hitler and an enemy of democracy—and brags about getting rid of Roe v Wade—clearly saving our democratic political system and guaranteeing reproductive rights have got to be key to your primary message to voters. She and Tim Walz have been doing that—with joy and energy. And supporters are working hard to get all those folks who understand the Trump threat to come out to vote.
But an even larger group of Americans keep telling pollsters that the economy is their major concern. Many have faulty memories— of Trump’s White House years as a time of prosperity—and of the Biden-Harris years as COVID-driven chaos and inflation. As a result, many Democratic Party operatives and media pundits have pushed Harris to distance herself from Biden—and, to some extent, she has done so.
Even in the narrow context of today’s political debate, many Americans just don’t want to remember how big a medical and economic mess Trump left for Biden and Harris to clean up.
But this “Don’t talk about Biden” strategy has prevented Harris (and Democrats) from being able to tell a powerful story about the Biden-Harris presidency—and it has limited her ability to talk about what is wrong about the economic system—and to about what kind of economy agenda we need to build for working Americans.
Joe Biden and Kamala Harris literally saved the U.S. and the world economy. They won the White House in 2020 in part because Donald Trump showed voters he was incompetent in the face of the COVID pandemic. And as a result of that pandemic-driven economic shutdown, Biden and Harris had to take on and reverse the most serious recession since the Great Depression. The amazing thing is that they actually pulled it off. When Biden and Harris took office, Americans had endured 8 months of official recession—and four years ago, the Trump unemployment rate was 9.2 percent. Deaths from COVID, which began in Trump’s last year in office, far from getting better, were at a deadly all-time high when Biden was sworn in.
Today, as a result of very ambitious policies that Biden and Harris put forward—and got passed through a divided Congress—the U.S. unemployment rate came down to below today’s 4.1%, and—if the Fed doesn’t blow it (or if Trump doesn’t win)—interest rates are coming down and inflation is stabilizing at 2.1% annual rate (down from the peak of 9.06% in June 2022). This Biden-Harris economic recovery is the envy of many other advanced nations that are still struggling to reduce unemployment. And we needed to remind voters that Biden and Harris surprised many economic experts by achieving a “soft landing”—getting jobs growing and bringing inflation down without tipping the economy into another recession. Ronald Reagan didn’t have such a great record when he ran for re-election declaring it was “Morning in America.”
Now clearly, working class Americans, white and black, don’t feel like it is Morning in America. But that feeling that the country is on the wrong track is not a recent development. For decades now, the very wealthy have gotten astronomically richer, and corporations have gained greater and greater control of our political and economic system, while middle-class and working-class people have seen declining real wages and fewer opportunities for themselves and their kids. Americans have been worried about their economic prospects for decades.
But even in the narrow context of today’s political debate, many Americans just don’t want to remember how big a medical and economic mess Trump left for Biden and Harris to clean up. And, since Democrats have been instructed to not talk about the Biden years, voters are now hearing just one explanation from Trump about what caused the post-COVID inflation: “Biden and Harris did it.” In other words, Trump blames the very Biden-Harris policies that helped Americans get through the COVID recession—and got the economy growing robustly.
Although not too many voters have heard it, Democrats have a different explanation: As the pandemic—worsened by Trump’s idiotic failures—literally shut down the global economy, the fragile international supply chain network froze up. And during the long period when the global factory system shut down—everything from food to cars to computer chips were stuck in container ships circling the globe or stuck in ports, huge parts of the U.S. economy were either forced to shut down—consumers experienced major shortages on store shelves or car dealers. Biden and Harris worked successfully to untangle these supply chain problem -- but the temporary shortages created huge opportunities for American corporations to raise prices and keep prices high (known as price gouging) for months and months. The painful result: higher prices for groceries, gas and oil, housing, and other essentials.
The Biden stimulus worked—the economy is growing and the inflation rate has come down for a rare “soft landing.” The Biden economic program wasn’t the cause of inflation. And without the Biden-Harris economic agenda, over the past few years Americans would have been struggling with the worst of both problems: high unemployment AND inflation.
Having revived economic growth and gotten the overall inflation rate going down—now at an annual rate of 2.1%—Kamala Harris took over as the Democratic nominee and began to lay out a positive agenda to take on corporate price manipulation and real shortages in food, housing, energy, and health care.
She vowed to break the power of corporations to take advantage of shortages to raise prices and keep them high. This dynamic is most obvious in the food sector (where corporate concentration gives corporations great power) and in the health care sector, where she and Biden have already begun to force pharmaceutical companies to compete on the price of essential drugs. And public health insurance, like Medicare and Obamacare, are still too dominated by corporate insurance companies. In housing, although interest rates are going down, Harris pledges to fight for a long-term project to build more housing, break the power of speculators in the rental market, and help first-time home buyers with up to $25,000 to cover their down payments. And in energy, where the prices of gasoline and other fuels have come down, she also pledges to continue to support alternative sources of power, like solar and wind, and hydro—all of which will bring down prices for individuals and for utilities.
Keep in mind that Donald Trump has advanced no ideas at all for reducing inflation. He did meet with oil industry CEOs to demand $1 billion to finance his campaign in return for massive huge policy giveaways – and if you think that would lower energy prices, I have a bridge I’d like to sell you. Trump’s plan to impose tariffs on all imports would increase inflation dramatically, according to economists right, left, and center.
A Harris presidency would work to reorganize each of these key sectors to bring down prices—while creating new public systems to help families with other basic needs, like free or subsidized child care (and in home senior care), the costs of which is now borne almost entirely struggling middle class and poor families.
Based on polling that shows inflation and the economy are the top issues for many voters, some progressive analysts have been arguing that Kamala Harris and her campaign are not talking enough about her economic agenda.
Pollster Stan Greenberg has been making the case that the Harris-Walz campaign would be pulling strongly ahead if they were doing more to educate voters on Harris’s economic plans. He cites a TV ad tested by the super PAC Future Forward that garners strong support when tested with working people:
In that ad, (Kamala Harris) said, ‘When I am elected president, I will make it a top priority to bring down costs. We should be doing everything we can to make it more affordable to buy a home and more than 100 million Americans will get a tax cut. I will help families; letting you keep more of your hard-earned money. As president, I will be laser focused on creating opportunities for the middle class that advance their economic security, stability and dignity.’
Greenberg argued “Closing positive with Harris battling for the middle class and helping everyone on their very top issue will engage and unite the Democrats’ base. That will shift the trajectory of this race.”
Certainly, the next two days will tell if he and other progressives are right.
How Harris could have distanced herself from Democratic orthodoxy
Kamala Harris has been constantly pressured—by the media and some Democrats—to show how she would distance herself from Joe Biden and Democratic orthodoxy. As we have seen, the Biden economic agenda was remarkably successful—and that may be one good reason why she refused to attack the Biden-Harris economic strategy. But in response to this pressure, she has shifted her campaign to attacking Trump as an extremist. Greenberg and other progressives argue that she should have campaigned more on her anti-inflation plans and the larger economic agenda she has put forward.
Here's another approach: Kamala Harris—as candidate and as our new President—could distance herself from several generations of Democratic leaders. For decades now, several generations of activist movements have pushed energetically for a new economic agenda for the Democratic party. It has been a hard slog, but we have made progress even with party elites.
1. Inflation killed the Presidency of Jimmy Carter, who was the last Democrat who had to deal with high inflation. Prices were rising by 9.9% and remained high throughout his term. Shorly after he took office a coalition of progressive groups called Consumers Opposed to Inflation in the Necessities met with Carter and made the case that he should fight inflation in the key “basic necessities” sectors where increasing prices were driving inflation. Carter ignored us and instead listened to more conventional voices, and he tried various experiments in “deregulation,” none of which worked. Finally Fed Chair Paul Volker raised interest rates to 19 percent, precipitating a recession. And Carter lost his election to Ronald Reagan, who attacked him for 13 percent inflation and high unemployment. The good news is that Kamala Harris (and Joe Biden) took another path—and that new approach is working.
Kamala Harris—as candidate and as our new President—could distance herself from several generations of Democratic leaders.
2. Trade Policy advanced by conventional Democrats has ignored the economic pain and devastation caused by treaties like Bill Clinton’s NAFTA and his sponsoring of China joining the World Trade Organization. Hillary Clinton and Barak Obama both fiercely promoted another, even more ambitious treaty, known as the The Trans-Pacific Partnership. Eventually, both realized that voters hated these job-killing trade deals, but not until they greatly damaged the Democratic brand with heartland working class voters, and they gave up on the TPP. Many people remember the 1999 “Teamsters and Turtles” demonstrations in Seattle that brought together over 50,000 protesters—union members, environmentalists, family farmers, indigenous rights activists, faith-based groups, and solidarity organizations—to confront global elites attending the ministerial meetings of the WTO. Slowly, those groups have moved Democrats to understand the need for a trade policy that preserves and creates good jobs, reduces global warming and creates prosperity. The Harris campaign has broken with the old “free trade uber alles” agenda of the Democratic Party. And just in time, because she will forge a more functional trade regime that is more progressive than the mindless and opportunistic trade agenda of Donald Trump.
3. Industrial Policy is closely related to trade. For years Democrats joined Republicans to denounce any kind of industrial policy (except for military spending) aimed at making American industry more productive, cleaner, and more competitive—or to help create new high-tech industries that can anchor economic development and replace jobs lost to mechanization. But there has been a citizen movement demanding action. And polls show that most Americans—especially blue-collar workers—strongly support smart industrial policies. Biden and Harris made huge strides in this new direction with the passage of The American Recovery Act, which helped revive all sectors of the economy. The CHIPS and Science Act of 2022—to rebuild our semiconductor industry. The Inflation Reduction Act—which included $369 billion for a climate initiative to reduce greenhouse emissions and promote lean energy technologies. This legislation put an annual cap of $2,000 for out-of-pocket prescription drug costs for those insured by Medicare—and helped improve Obamacare, which was a beginning of an industrial policy for the huge and costly American health industry.
4. Investing in a Stronger Social Contract for Middle-Class and Working People—by Ending Austerity, Taxing the Rich, Growing the Economy.
The creation of Social Security by Franklin Roosevelt and Medicare by Lyndon Johnson marked major milestones in the ongoing quest to put an economic floor under the lives of working folks and poor people. After many battles which pitted the vast majority of Americans against Republicans (and conservative Democrats) who wanted to cut benefits or “privatize” these beloved social insurance programs, a new generation of activists have learned to stop attacks—and many are now working to expand and improve Social Security and Medicare, long harmed by conservative governments. And while we must protect the Affordable Care Act, millions of Americans are working to transform Obamacare into a more comprehensive and less expensive system of health care.
If we want to live as well as the social democratic countries of the world, we will need to greatly improve our health care system.
Most advanced capitalist countries guarantee child care, pre-care education, paid family and medical leave, and in-home or community care for seniors and people with disabilities and their families. And if we want to live as well as the social democratic countries of the world, we will need to greatly improve our health care system.
Today there is a growing movement to win these expanded social insurance plans that can help make individuals and families more secure—and people who work for small businesses and corporations more productive.
Our crazy system of financing college and trade school education was so bad that when young people started talking about wiping out student debt—and making state universities tuition free, the idea took off like a rocket in the political debate—and Joe Biden and Kamala Harris became the champions of this big change. If Kamala wins the White House, we can expect her to keep pushing.
Popular programs like these are expensive. But our corporations and billionaires pay less in taxes than most other wealthy countries. Big coalitions like Americans for Tax Fairness are working for fair taxes—and an end to the Trump tax giveaways to the rich and corporations—that would provide us the resources we need to invest in a stronger social safety net.
5. Donald Trump thinks global warming is a hoax, but most Americans know we must act boldly to reduce carbon emissions. Unfortunately, for years Democratic leaders tried to achieve this by putting a tax on energy consumption—which would have raised costs to working Americans. Bill Clinton tried to pass a carbon tax in 1006, but even Democrats wouldn’t vote for it.
Eventually, after being schooled by climate activists—and by labor unions, who came to understand that transforming our energy system will mean good jobs—the Biden team proposed and got passed a historic legislation that used Federal funds to invest in energy conservation and new forms of green energy production. Those investments are producing millions of new jobs, many of them union jobs.
6. American workers have a right to be represented by a union. This proposition is increasingly popular today as billionaires and monopolies have come to dominate the economy and work places. The best unions have become creative about helping workers organize to secure rights at work and better lives for their families. And the Biden-Haris administration has not only taken important symbolic steps to support worker struggles—like Biden and Harris’s support for the historic United Auto Workers strike— they have made real change—for example by appointing Jennifer Abruzzo to the post of general counsel of the National Labor Relations Board. She has charted a dramatic new path to strengthen and defend workers rights to organize and to challenge anti-labor employers. Democrats have long given lip service to passing a new labor law—known as the Pro Act—to strengthen worker rights. And if Kamala Harris wins the Presidency—with a Congressional majority, she should be expected to write and pass an even tougher labor rights bill that can begin the process of guaranteeing that American workers have the kind of rights at work that workers in other advanced countries won years ago.
If we want a government that works for a better life for Americans, we must get big money out of politics.
7. We must take our democracy back from the wealthy and corporate elites. It is hugely important that we stop Donald Trump’s systematic attacks on our democratic system. But even when we defeat him—we will still have a political system that is dominated by massive amounts of money—including an obscene $134 million this year from crypto-currency investors to buy elections for House, Senate and White House. The U.S. now has a legal framework in which the Supreme Court’s Citizens United decision allows corporations and billionaires to flood elections with unlimited money—and which allows lobbyists to reward Members of Congress to do their bidding. And in order to use democracy to clean up the system we are going to have to make the U.S. Senate more democratic—by abolishing the filibuster that now requires a super majority in order to pass any significant changes. And grass-roots Democrats have discovered that we need to change party rules to prevent mysterious and evil dark money from dominating the system for nominating Senators and Members of Congress. If we want a government that works for a better life for Americans, we must get big money out of politics.
8. The rich have gotten richer and they have hollowed out the middle class.
The economic gap between the very rich and the rest of us has been growing dramatically for the past 30 years and more.
Income disparities are now so pronounced that America’s richest 1 percent of households averaged 139 times as much income as the bottom 20 percent in 2021, according to the Congressional Budget Office.
In the 1980s, when the Economic Policy Institute was founded as a think tank for working people, EPI’s early research began to demonstrate that the income and wealth of the richest Americans was pulling away from middle-class and working Americans. At first establishment economists denied the trend—or they said it was only temporary. Today everyone—left, right and center— acknowledges the problem, and the debate is about what to do about it—or about whether we can or should do anything about it. But most working people now know what growing inequality is doing to their families. And they want solutions. And one of the first battles Kamala Harris will face require us to rally the country to put an end to the Trump tax cuts for the rich and corporations that did so much to accelerate inequality of income and wealth.
All of the inter-woven movements for economic change described above aim at making the U.S. a society where there are fewer extremes of wealth and income—and where the very wealthy do not have the power to block the aspirations of the rest of us for a better life.
The New Centrism
In May, the respected New York Times senior reporter David Leonhardt wrote an important article entitled “A New Centrism Is Rising in Washington: Call it neopopulism: a bipartisan attitude that mistrusts the free-market ethos instead of embracing it.” Here’s what he wrote in his article in the Times:
For decades, Washington pursued a set of policies that many voters disliked and that did not come close to delivering their promised results. Many citizens have understandably become frustrated. That frustration has led to the stirrings of a neopopulism that seeks to reinvigorate the American economy and compete with the country’s global rivals.
A defining quality of the new centrism is how much it differs from the centrism that guided Washington in the roughly quarter-century after the end of the Cold War, starting in the 1990s. That centrism—alternately called the Washington Consensus or neoliberalism — was based on the idea that market economics had triumphed. By lowering trade barriers and ending the era of big government, the United States would both create prosperity for its own people and shape the world in its image, spreading democracy to China, Russia and elsewhere.
Winning this election is just the beginning of the work that needs to be done...
That hasn’t worked out. In the U.S., incomes and wealth have grown slowly, except for the affluent, while life expectancy is lower today than in any other high-income country.
Americans lean left on economic policy. Polls show that they support restrictions on trade, higher taxes on the wealthy and a strong safety net. Most Americans are not socialists, but they do favor policies to hold down the cost of living and create good-paying jobs. These views help explain why ballot initiatives to raise the minimum wage and expand Medicaid have passed even in red states. They also explain why some parts of Biden’s agenda that Republicans uniformly opposed, such as a law reducing medical costs, are extremely popular. This is where the center of gravity in the country is.
Leonhardt is right that this new neopopulist approach to economics is very popular across the spectrum of Americans—with those who didn’t go to college and those who did, with men as well as women, with people struggling to stay middle class and with working class and poor people—white, Black, Hispanic and Asian. But this new popularity is not just the result of “new thinking” by academics and policy advisers. What he calls this new “centrism” is now making sense to voters and politicians alike because of the work of several generations of progressive activists—from my old friends fighting for civil rights and against a terrible war—to today’s generation of activists fighting for economic equality, to break the power of corporate manipulation of our political system, and to build an economic system that can build a better life for all Americans. That multi-generational movement (See the Solidarity Agenda) has helped shape the Biden-Harris presidency—and we all must hope that our work has helped to put Kamala Harris into the White House. And, after all our work, we will need to take a breath, get some rest—and then get to work to make that new agenda a reality.
Assuming Kamala Harris wins the election, it will be due in part to her campaign to fight back against the Donald Trump’s destructive attacks on women, on democracy, and against his desire for authoritarian power. But her victory will also be due to her ability to lay out an economic agenda that builds on the record of her service with Joe Biden’s administration—which represented a sharp break with Republican and Democratic neoliberalism. But winning this election is just the beginning of the work that needs to be done to create a better life for the American people.
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The World Bank Needs Better Metrics to Understand Inequality
The bank is pushing a statistical notion of “shared prosperity” that, as one expert puts it, “leaves the rich out of the equation!”
Aug 03, 2023
Been eating a bit too much ice cream this sweltering summer? Thinking about going on a bit of a diet? Well, imagine yourself counting calories but exempting anything with sugar from all your counting.
Would that approach help you make an appreciable dent on your excess bodily baggage? Of course not. We can’t eliminate what we ignore. And that goes for inequality as well, over 300 distinguished economists worldwide are charging in a new open letter to the United Nations and the World Bank.
Back in 2015, these eminent economists remind us, the world’s nations came together and adopted a series of “Sustainable Development Goals”—SDGs for short—designed to systematically attack both poverty and climate change. The tenth of these goals specifically aims to “reduce inequality within and among countries.”
Significantly narrowing our world’s deeply unequal distribution of income and wealth will, of course, always remain a tall order, given the political power that grand fortunes create. The World Bank, unfortunately, has made that order taller.
The progress so far on this inequality SDG? Practically nonexistent. By many measures, the open-letter economists note, our “inequalities have worsened,” and that worsening really matters. Without reducing the “deep divide” that separates our global rich from the rest of us, the economists suggest, we’ll forever be going nowhere on “ending poverty and preventing climate breakdown.”
Significantly narrowing our world’s deeply unequal distribution of income and wealth will, of course, always remain a tall order, given the political power that grand fortunes create. The World Bank, unfortunately, has made that order taller.
The U.N.’s member nations have essentially made the bank the world’s official inequality scorekeeper. But the metrics the World Bank uses to track inequality have turned out to be “very inadequate,” charges Jayati Ghosh, a coauthor of the economists’ new open letter.
We already have, Ghosh points out, a variety of established yardsticks for measuring inequality. The Gini coefficient plots actually existing income distributions between 0 for total equality and 1 for infinite inequality. The more easily understandable Palma ratio divides the income share of a society’s top 10% by the income share of its bottom 40%.
The World Bank isn’t relying on either of these standard measures. The bank is instead pushing a statistical notion of “shared prosperity” that, as Ghosh puts it, “leaves the rich out of the equation!” This World Bank measure defines success in the battle against inequality as what we have when the incomes of the bottom 40% are growing faster than the national average income.
On the World Bank’s scorecard, in other words, any nation where the incomes of the top 1% are rising ten times faster than the national average income would be making “progress” against inequality so long as the incomes of the bottom 40% were rising slightly faster than that national average.
This “bizarre notion of ‘shared prosperity,’” says Jayati Ghosh, “provides very misleading estimates of the extent of inequality or progress in reducing it.”
By this bizarre World Bank yardstick, over half the world—53% of the nations the bank sampled—were making progress against inequality just before the pandemic hit and another 11% were showing no change.
Researchers with the World Inequality Database, an ambitious statistical effort that takes inspiration from the ground-breaking research of scholars like Thomas Piketty, paint a starkly different picture. Only 26% of the world’s nations, as measured by the Gini coefficient, are actually showing progress against income inequality, and only 12% are showing progress in Palma-ratio terms.
For three top global inequality watchdogs—Oxfam, the Development Finance International, and the New York University Center for International Cooperation’s Pathfinders initiative—the World Bank’s “shared prosperity” scorekeeping makes plain the need for a real “data revolution” that spotlights the wealth of the world’s wealthiest.
The World Bank’s current approach, these three groups charged in a new report released last month, essentially “ignores what is happening to the rich.” We cannot afford that ignoring, the groups stress, not at a time when “the world’s wealthiest citizens continue to be largely responsible for extreme carbon emissions” while the world’s “poorest citizens pay the price through climate disasters.”
Will critiques like this get the World Bank to change its statistical ways? We’ll see. The bank’s first reaction to the economists’ open letter has been somewhat encouraging. The World Bank, says a spokesperson, agrees “we need to do more to address inequality” and “do better in measuring progress.”
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A Global Green New Deal Is the Best Way to Save the Planet
What is urgently needed is a political platform that embraces a sound climate stabilization plan which ensures a just transition, creates a plethora of new jobs, reduces inequality, and promotes sustainable growth.
Jul 30, 2023
Another summer is upon us and heatwaves are scorching many parts of the world, smashing thousands of temperature records. Even the world’s ocean surface temperature is off the charts, reaching unprecedented levels, while sea ice level in the Antarctic has set a record low for the second year in a row.
Indeed, planet earth is screaming because “ climate change is out of control,” as U.N. General-Secretary António Guterres recently put it. Yet the global community’s response to the greatest existential threat facing humanity continues to be not merely unacceptably slow but borders on criminal negligence.
We know the reasons why.
But we should also be asking ourselves an additional question: Why is it that populations are not motivated enough to address the climate crisis?
Fossil fuels supply about 80% of the world’s energy, and contemporary politics is trapped in the short term, with little evidence that it can be repaired. Across the world, politicians continue to make enormous compromises to short term interests in the name of energy security. China and the U.S. are the world’s biggest carbon polluters. Yet President Joe Biden has signed off on a series of major fossil fuel projects, and China is building more new coal plants than the rest of the world. This is even while both countries are also pursuing aggressive clean energy transition policies—indeed they are competing with one another on these.
To add insult to injury, governments continue to subsidize fossil fuel production. In 2022, subsidies worldwide for fossil fuel consumption rose above $1 trillion, according to the International Energy Agency. And the world’s biggest banks have provided $5.5 trillion in finance to the fossil fuel industry over the past seven years.
As for global climate conferences, they have turned out to be not only ineffective but something of a cruel joke. They function in the absence of an “enforcement mechanism,” and empty words and promises are their hallmark feature. Greta Thunberg was indeed right on the mark when she chastised global leaders at the Youth4Climate event in Milan for their failure to address the climate emergency, dismissing their rhetoric as “blah, blah, blah.”
Moreover, data has shown that fossil fuel lobbyists attending the negotiations in climate conferences outnumber almost every national delegation. There were more than 500 fossil fuel lobbyists at the COP26 climate conference in Glasgow, Scotland, and more than 600 at the COP27 summit in Sharm el-Sheikh, Egypt. As for COP28, which will take place this year from November 30 until December 12, the host is the United Arab Emirates, one of the world’s major oil and gas producers, and will be presided by Sultan al-Jaber, the CEO of the Abu Dhabi National Company. At this global climate summit, fossil fuel companies are expected to have an even bigger voice. And their main focus is to promote carbon capture technologies. These technologies have yet to demonstrate their capacity at scale, while also offering their own dangerous side effects.
This is all pretty understandable. It’s capitalism at work.
But we should also be asking ourselves an additional question: Why is it that populations are not motivated enough to address the climate crisis? Not only that, but far-right and right-wing populist parties, which are hostile to climate and carbon-low energy, are growing in prominence and influence. The rise of far-right movements is felt not only in Europe and the United States, but also in Eurasia and South Asia, while right-wing platforms remain popular across Latin America in spite of the fact that the region has shifted to the left over the past two decades.
The reasons for this unfortunate and disturbing development are a bit more complicated. Demagogues are the worst enemies of the laboring populations, yet the working class and poor people are easy targets. In our own era, neoliberal policies (deregulation of the economy, privatization, suppression of wages, and shifting the orientation of the state as far away as possible from redistribution and a socially-based agenda) had led to extremely harmful consequences, including poverty, mass unemployment, income inequality, deficits in decent work and labor rights, social exclusion, and overall decline in the standard of living.
In Europe, home to the majority of the richest countries in the world, in 2022, more than 95 million European Union citizens, representing close to 22% of the population, were at risk of poverty and social exclusion.
In the U.S., more than 51 million workers currently make less than $15 an hour—nearly one-third of the workforce—according to data compiled by Oxfam, and the official poverty rate with nearly 38 million people is considered by many experts to be based on a vastly inaccurate measurement of poverty in the United States. For example, the MIT living wage model uses a cost of living estimate that far exceeds the federal poverty thresholds.
At the heart of the neoliberal vision is a societal and world order based on the prioritization of corporate power and free markets and the abandonment of public services. The neoliberal claim is that economies would perform more effectively, producing greater wealth and economic prosperity for all, if markets were allowed to operate without government intervention. This claim is predicated on the idea that free markets are inherently just and can create effective low-cost ways to produce consumer goods and services. By extension, an interventionist or state-managed economy is regarded as wasteful and inefficient, choking off growth and expansion by constraining innovation and the entrepreneurial spirit.
However, the facts say otherwise. During the period known as “state-managed capitalism” (roughly from 1945-73, and otherwise known as the classical Keynesian era), the Western capitalist economies were growing faster than at any other time in the 20th century and wealth was reaching those at the bottom of the social pyramid more effectively than ever before. Convergence was also far greater during this period than it has been during the last 45 years of neoliberal policies. Moreover, under the neoliberal economic order, Western capitalist economies have not only failed to match the trends, growth patterns, and distributional effects experienced under “managed capitalism,” but the “free-market” orthodoxy has produced a series of never-ending financial crises, distorted developments in the real economy, elevated inequality to new historical heights, and eroded civic virtues and democratic values. In fact, neoliberalism has turned out to be the new dystopia of the contemporary world.
Today’s left has failed so far to convince the laboring populations that it has a viable political agenda which can effectively address their immediate concerns as well as tackle the climate crisis.
Under the neoliberal socio-economic order and its effects, which provoke fear, insecurity, and indignation, it is not difficult to see why the laboring populations might fall under the spell of right-wing demagogues who know how to exploit societal divisions and resort to deception and manipulation with a political repertoire based on xenophobic nationalism and law and order. It is also not hard to see why concerns about climate breakdown might become far less of a priority for them when they are struggling to make ends meet. Putting food on the table, paying the rent, and fears of losing a job are what may keep average folks awake at night—not climate breakdown, even when they do recognize it as a major threat. Indeed, climate change, surely among U.S. voters, remains “a lower priority than issues such as strengthening the economy and reducing healthcare costs,” according to a recent Pew Research Center survey. And France’s “yellow vest” movement speaks volumes about the political risks of green taxes, in conjunction with tax cuts for the wealthy, while living standards are moving in the wrong direction.
This is where radical collective social and political action ought to come in, as it is the only hope we have for a sustainable future. But today’s left has failed so far to convince the laboring populations that it has a viable political agenda which can effectively address their immediate concerns as well as tackle the climate crisis. Today’s left, particularly in Europe, has an economic agenda which pays lip service to social transformation and lacks a concrete action plan for addressing the climate crisis through sustainable development strategies. Throughout the advanced industrialized world, existing climate plans remain insufficient and proceed alongside national plans to increase energy security through reliance on new oil, gas, and petrochemical infrastructure projects.
Make no mistake about it. “Oil and gas projects are back in a big way,” as a recent New York Times article put it. And climate protests alone cannot stop global warming. They do have a positive impact on public opinion, though "extreme action protests" can also backfire, according to some studies.
Moreover, some bad ideas, such as that of degrowth, have begun to gain ground, distracting attention away from real solutions to the climate crisis and to the ills of neoliberalism.
What is urgently needed is building long-term progressive power around a vision of left-wing politics that is energized by the pressing need to tackle the climate crisis by radically accelerating the transition away from fossil fuels while at the same time pushing for a structural transformation of present-day economies. In other words, a political platform that embraces a sound climate stabilization plan which ensures a just transition, creates a plethora of new jobs, reduces inequality, and promotes sustainable growth. Of course, this is what the Green New Deal (GND) is supposed to be all about, except that there are a number of different versions of a GND policy plan, including one adopted by the European Union. But Europe’s green ambitions (they call it the “European Green Deal” and the aim is for the E.U. to achieve net-zero greenhouse gas emissions by 2050) are contradicted by European countries’ quest for new fossil fuel supplies. In addition, and this is typical of poorly formulated GND policy plans, the European parliament has voted in support of E.U. rules labeling natural gas and nuclear energy as green investments.
Even so, the movement for the Green New Deal is growing and is making a positive impact on several fronts. Several states and over 100 cities in the United States have committed to 100% clean energy. The Inflation Reduction Act may not qualify as a GND, but it is still a historical piece of legislation, especially given the existing political climate in the country.
Still, one might say that what we really need in order to save the planet is a comprehensive GND, formulated as a worldwide program. But we do have such a blueprint in place, courtesy of the American economist Robert Pollin, and fully endorsed by the world’s greatest intellectual alive, namely Noam Chomsky.
All that degrowth will accomplish is more pain for working class people and will most likely fuel further support for the far-right.
Degrowth is not the answer. As Robert Pollin has argued powerfully and persuasively, cutting back on economic growth will have little to no impact on the task at hand, which is "delivering a zero-emissions global economy." More precisely, if we depend on reducing gross domestic product (GDP) to reduce emissions, then it follows that we can only reduce emissions by the same number we reduce growth. For example, if GDP shrinks by 10%—a massive global recession—it will succeed in cutting emissions by only 10%. We need emissions down to zero.
Moreover, the idea of shrinking rather than growing economies is, politically speaking, a self-defeating proposition. All that degrowth will accomplish is more pain for working class people and will most likely fuel further support for the far-right.
Of course, degrowth advocates argue that this is a project targeted at the Global North, not a path for the Global South. However, are we to assume on the basis of such claims that the developed countries are void of class inequalities and have somehow escaped the sort of socio-economic ills that accompany the implementation of ruthless neoliberal policies? Are we to believe that there is no need to improve living conditions, reduce poverty rates, and increase employment opportunities for the Western masses? Perhaps such notions do lie behind degrowth, which is why some, if not most, of its advocates reject the idea of economic planning and by extension of the GND. In this sense, I think it’s quite fair to say that degrowth is in fact working in service of neoliberalism while doing nothing to stop global warming. Committed socialists should have nothing to do with degrowth policy proposals.
Pondering radical proposals for saving the planet and humanity from the effects of global warming should be welcomed as they may generate opportunities for creative forms of political and social action. But degrowth is neither a radical alternative nor is it based on sound economics. Furthermore, it is a rather dangerous political idea as it will hurt mostly the laboring classes and deliver them straight into the arms of the far-right.
For all practical intents and purposes, radical politics in the age of climate breakdown goes through a (global) Green New Deal—not through degrowth rhetoric, which is in full display in the current issue of Monthly Review. It is up to the socialist left to embrace it and see that its vision turns into reality.
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New Watchdog Project Targets Neoliberal 'Hacks' Posing as Economic Prophets
"Anyone who claims they have the absolute answer to every economic question isn't being honest with you. They're being a hack, and they shouldn't be considered serious sources."
Mar 22, 2023
Taking aim at "conflicts of interest and flat-out falsehoods in economics reporting and the so-called experts who perpetuate them," the Revolving Door Project on Wednesday launched a new website, Hack Watch, to name and shame Wall Street-friendly experts pushing often harmful neoliberal financial theories as absolute truths.
"Anyone who claims they have the absolute answer to every economic question isn't being honest with you. They're being a hack, and they shouldn't be considered serious sources," Max Moran, the personnel team director at Revolving Door Project (RDP), said in a statement introducing the new site.
"Economists like to sound certain, and they like to ridicule anyone who disagrees with them."
A follow-up to RDP's wildly successful Hack Watch newsletter—which began by scrutinizing former U.S. Treasury Secretary Larry Summers, often called "Wall Street's favorite economist," and his cryptocurrency partnerships—the website features an FAQ section on the federal debt as well as a "Trope Tracker" meant to dispel "common fallacies, falsehoods, and framing mistakes in economics coverage."
"Economists like to sound certain, and they like to ridicule anyone who disagrees with them," said Moran. "This can incline reporters, especially reporters who worry that they don't understand economics very well, to defer to economists unquestioningly."
Moran continued:
In the neoliberal age, economic analysis (from the right kind of neoclassical economists) was considered scientific truth. This is nonsense. Economics isn't a hard science, it's a method of analysis—a set of tools that help us to understand a few particular ways of how the economy works. Deciding what's actually right or wrong for the economy is always, ultimately, a matter of values and philosophy, which we express through politics.
"Top hacks" who already have bios on the new site include Summers, 2009 auto industry bailout architect Steven Rattner, Committee for a Responsible Federal Budget president Maya McGuineas, and senior vice president Marc Goldwein.
"Economics isn't a hard science, it's a method of analysis—a set of tools that help us to understand a few particular ways of how the economy works."
"When these hacks receive air time, they often present the existing socio-economic order as a natural phenomenon, softly echoing Margaret Thatcher's famous 'no alternative' declaration," said Dylan Gyauch-Lewis, who co-leads the Hack Watch project, in a reference to the former right-wing British prime minister's infamous neoliberal slogan.
"In a time of crisis after crisis, we cannot afford to restrict the public's imagination to the world as it was in 1992," Gyauch-Lewis asserted. "The staid old guard not only restricts the public conception of what economic policy can be, it misleads about what that view already is."
"To allow the same few Clintonian New-Democrats to monopolize discourse does viewers, policymakers, and the world a great disservice," he added.
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The Downsides of Cheap Abundance
Oct 23, 2015
In college, Economics 101 is often described as the social science discipline that deals with the production, distribution and consumption of goods and services. MIT Economist Paul Samuelson liked to focus on scarcity, or more specifically, the allocation of scarce resources. "Abundance" was always a pretty word with an idyllic connotation for Professor Samuelson. I often wonder why there weren't a few classes about the real-life consequences of abundance, along with scarcity and people's material welfare.
The present generation of internet technology is a proper subject of study within an economic framework. It might help us understand what is happening to our society.
Let's start with today's highly-touted information age. At our fingertips is the greatest free trove of information in human history. We can get it quickly and efficiently. Are we more informed? Are we hungry for more information? Do we read more books in an era of record production of books? Do we know more about what our congressional and state legislators are about? Are we more knowledgeable about history and its lessons?
My sense is that the present generation of students knows about popular art and music, and has a nascent awareness of current events. But an unfortunate consequence of the abundance of information available to them is that too many students have left themselves less informed than their predecessors about serious information regarding our overall society and the world. This includes geography, politics, economics, literature, history, the side effects of technology, the interactions between consumers, workers, taxpayers and corporations, the doings of City Hall, or even how to cultivate gardens. Alas, the virtual reality of the culture of addictive distractions and stupefying daily routines still reign.
Just about everyone now has a smartphone with which they can enter an endless world of spectator entertainment, video games, and checking of messages by the minute, to name a few of the engagements. Granted, serious news, feature stories, lectures, rallies, programs, and other materials are also available. Judging by the Twitter followers of Hollywood celebrities and even famous cats, dogs, and horses, for some internet users there is a crowding out of information that matters most for a functioning democracy. And unless you're in one's inner circle, try having two-way communication with someone using any of the new technologies without long waits. The age of dial phones and letters had more than charm.
Energy presents another example of abundance. Historically, the United States had abundant, cheap energy and, with Canada, set the world's record for wasting it; while Japan had limited domestic energy resources and became much more efficient in using what they produced and favored efficient cars, homes, and appliances. Energy efficiently used means less pollution and fewer greenhouse gasses.
Abundant cheap water has led to much waste of water. When water rates go up there is more efficient usage. California is experiencing water shortages and as a result of scarcity in combination with regulatory restrictions, people in California are wasting less water.
Making our abundant "commons" - owned by the American people - available to exploit freely or nearly so by corporations has led to vast wastelands. The public lands - one-third of the U.S. landmass plus huge offshore areas - are open to oil mining and timber companies for ridiculously low-price leases. For hard-rock minerals like gold and silver, the 1872 Mining Act only requires as little as $5 an acre to extract billions of dollars of minerals a year. No Royalties are required. Such unlimited use takes away the people's resources with nothing but cleanup costs for the mining wastes left behind for taxpayers. (See bollier.org.)
When FCC chairman, Newton Minow, called television a "vast wasteland" in 1961, he wasn't just speaking metaphorically. The radio and television broadcast stations control our public airways 24 hours a day. Because "We The People," who are the landlords, do not reserve time daily for audience networks and also do not charge the stations for their use of public airwaves, broadcasters can waste their round-the-clock abundance (see Claire Riley's "Oh Say Can You See: A Broadcast Network for the Audience," Virginia Law Review (Fall, 1988)).
A relatively new entry in the world of abundance is corporate capital. The cries from business about a capital shortage in the 1970's, so as to get more tax breaks, have long been muted by the trillions of dollars the U.S.'s big businesses have lying inert here and abroad. Such abundance has led to hundreds of billions of dollars in unproductive stock buybacks since 2000.
A leading analyst of big business behavior, Robert Monks, has called such buybacks a clear sign of incompetent or unimaginative management. By this he means that such profits should be used for productive investment, better wages, or more dividends to shareholders, mutual funds, and pension trusts who should exercise more of their ownership leverage.
Instead, the corporate bosses prefer to apply such profits, derived from the sweat of their workers and also government provided corporate welfare, to reduce the earnings per share ratio which enhances the criteria for increasing their already sky-high executive compensation. Stock buybacks rarely sustain a higher share price.
What to do with this expanding phenomenon of "abundance" in a world wracked by public and private poverty and its damaging fallouts? We must impose wisely-used charges or taxes on the abundant commons. For example, charging royalties for hard-rock mining and raising leases to market-based prices for other publically-owned resources can be used for needed land reclamation. Charging rent for the use of public airways can pay for better interactive programming and establishing audience networks. Imagine how an audience network could facilitate the potential for the people to summon campaigning politicians to real debates on their own radio and TV stations.
Requiring telecommunications companies to donate some of the profits they make from customers who pay exorbitant fees to use smart phones could provide revenues for the development of civic applications, and would help to offset the trivialization that has arrived with the technology.
As for the capital glut, an excess accumulated profits tax will provide an incentive to put such capital to productive work or return it the shareholders - the owners of the corporations.
We'd better think more about "abundance" and its negative consequences.
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$10.10: The Low-End of Minimum Wage Hopes Gets DC Push
Though a full third less than the $15 "living wage" advocated by grassroots organizers, congressional push to increase federal minimum wage gets prominent backing
Jan 14, 2014
Joining a growing national push for an increase of the federal minimum wage, a letter signed by more than 75 prominent economists, including seven Nobel laureates, urges congressional leaders to support legislation that would raise the lowest allowable hourly wage for U.S. workers from $7.25 to $10.10 by 2016 and index the wage to inflation for continued increases going forward.
Known as the Fair Minimum Wage Act, the bill supported by the economists was introduced by Sen. Tom Harkin (D-Iowa) in the Senate and Rep. George Miller (D-Calif.) in the House. If enacted, the law would raise the federal minimum wage in three incremental increases of $0.95 from its current level of $7.25 to the $10.10 level over two years.
"Let's be clear: our federal minimum wage of just $7.25, which has not budged in more than four years, is now a poverty wage," said Harkin, who chairs the Senate Health, Education, Labor, and Pensions Committee, in a statement on Tuesday. "No American who works a full-time job should have to struggle to put food on the table or pay the bills. All around the country, we're seeing the impact of growing income inequality and stagnant wages on millions of American families. Raising the minimum wage will help narrow the income gap and enable millions of low-wage working Americans to make ends meet."
The joint letter by dozens of economists--including Heidi Shierholz, Robert Pollin, Dean Baker, Robert Reich, and Joseph Stiglitz--was orchestrated by the Economic Policy Institute and the Center for Economic and Policy Research in Washington D.C. and presented at a press briefing on Tuesday aimed at attracting support for the Harkin-Miller proposal.
According to the economists' letter: "The increase to $10.10 would mean that minimum-wage workers who work full time, full year would see a raise from their current salary of roughly $15,000 to roughly $21,000. These proposals also usefully raise the tipped minimum wage to 70% of the regular minimum."
"This letter shows that moderate increases in the minimum wage are embraced by a broad array of prominent economists," said EPI president Lawrence Mishel. "Research proves that raising the minimum wage is an important and effective policy instrument."
Mishel use of the word "moderate" reflects the view of many that a much larger increase to the minimum wage is warranted given current economic inequality, the growth in poverty rates resulting from wage stagnation and a systematic assault on the social safety net now emanating from Congress. Even the economic think tank's own research shows that a $10.70 wage would be needed in order to bring pay back to levels, adjusted for inflation, that workers experienced in the late 1960's.
Going further, a group in Seattle called 15Now.org launched a national drive on Sunday calling for a $15 dollar minimum wage from coast to coast.
According to organizers there, all fights for minimum wage increases are commendable but what working people really need is a "living wage"--which means a wage that brings workers out of poverty in order to meet minimum standards of modern living. Though the exact hourly rate can vary depending on geographic differences, most calculators show--including the Living Wage Calculator at MIT and a recent report by the Alliance for a Just Society--that a truly living wage for most Americans is well above $15 an hour.
Throughout 2013 low-wage workers from the retail and fast food sectors staged rallies and protests calling for a living wage and dignity in the work place, paving the way for bolder calls from elected officials and a growing grassroots movement focused on wage disparity and the plague of inequality nationwide.
Despite more radical calls for a larger increase, the Harkin-Miller bill in Congress--which closely follows President Obama's public statements about the kind of wage increase he would support--remains the legislation receiving the broadest public support from elected leaders in Washington.
Tuesday's EPI press conference, featuring Sen. Harkin and Rep. Miller, can be watched here:
The Path Forward for Raising the Federal Minimum Wage to $10.10At a briefing at the Economic Policy Institute on Tuesday, January 14, 2014, Jason Furman (Chairman of the White House Council ...
And the full letter supporting the bill and its signatories follows:
Dear Mr. President, Speaker Boehner, Majority Leader Reid, Congressman Cantor, Senator McConnell, and Congresswoman Pelosi:
July will mark five years since the federal minimum wage was last raised. We urge you to act now and enact a three-step raise of 95 cents a year for three years--which would mean a minimum wage of $10.10 by 2016--and then index it to protect against inflation. Senator Tom Harkin and Representative George Miller have introduced legislation to accomplish this. The increase to $10.10 would mean that minimum-wage workers who work full time, full year would see a raise from their current salary of roughly $15,000 to roughly $21,000. These proposals also usefully raise the tipped minimum wage to 70% of the regular minimum.
This policy would directly provide higher wages for close to 17 million workers by 2016. Furthermore, another 11 million workers whose wages are just above the new minimum would likely see a wage increase through "spillover" effects, as employers adjust their internal wage ladders. The vast majority of employees who would benefit are adults in working families, disproportionately women, who work at least 20 hours a week and depend on these earnings to make ends meet. At a time when persistent high unemployment is putting enormous downward pressure on wages, such a minimum-wage increase would provide a much-needed boost to the earnings of low-wage workers.
In recent years there have been important developments in the academic literature on the effect of increases in the minimum wage on employment, with the weight of evidence now showing that increases in the minimum wage have had little or no negative effect on the employment of minimum-wage workers, even during times of weakness in the labor market. Research suggests that a minimum-wage increase could have a small stimulative effect on the economy as low-wage workers spend their additional earnings, raising demand and job growth, and providing some help on the jobs front.
Sincerely,
Henry Aaron, Brookings Institution
Katharine Abraham, University of Maryland
Daron Acemoglu, Massachusetts Institute of Technology
Sylvia Allegretto, University of California, Berkeley
Eileen Appelbaum, Center for Economic and Policy Research
Kenneth Arrow, Stanford University*+
David Autor, Massachusetts Institute of Technology
Dean Baker, Center for Economic and Policy Research
William Baumol, New York University+
Jared Bernstein, Center on Budget and Policy Priorities
Josh Bivens, Economic Policy Institute
David Blanchflower, Dartmouth College
Alan Blinder, Princeton University
Heather Boushey, Washington Center for Equitable Growth
Clair Brown, University of California, Berkeley
Gary Burtless, Brookings Institution
David Cutler, Harvard University
Sheldon Danziger, Russell Sage Foundation
Angus Deaton, Princeton University+
Gregory DeFreitas, Hofstra University
Peter Diamond, Massachusetts Institute of Technology*+
Avinash Dixit, Princeton University+
Arindrajit Dube, University of Massachusetts, Amherst
Ronald Ehrenberg, Cornell University
Henry Farber, Princeton University
Nancy Folbre, University of Massachusetts, Amherst
Robert Frank, Cornell University
Richard Freeman, Harvard University
Claudia Goldin, Harvard University+
Robert Gordon, Northwestern University
Darrick Hamilton, The New School
Heidi Hartmann, Institute for Women's Policy Research
Raul Hinojosa-Ojeda, University of California, Los Angeles
Harry Holzer, Georgetown University
Marc Jarsulic, Center for American Progress
Lawrence Katz, Harvard University
Melissa Kearney, University of Maryland
Adriana Kugler, Georgetown University
Mark Levinson, SEIU
Frank Levy, Massachusetts Institute of Technology
Lisa Lynch, Brandeis University
Julianne Malveaux, Past President, Bennett College
Ray Marshall, University of Texas, Austin
Alexandre Mas, Princeton University
Eric Maskin, Harvard University*
Patrick Mason, Florida State University
Lawrence Mishel, Economic Policy Institute
Alicia Munnell, Boston College
Samuel Myers, University of Minnesota
Manuel Pastor, University of Southern California
Robert Pollin, University of Massachusetts, Amherst
Michael Reich, University of California, Berkeley
Robert Reich, University of California, Berkeley
William Rodgers, Rutgers University
Dani Rodrik, Institute for Advanced Study
Jesse Rothstein, University of California, Berkeley
Cecilia Rouse, Princeton University
Jeffrey Sachs, Columbia University
Emmanuel Saez, University of California, Berkeley
Isabel Sawhill, Brookings Institution
Thomas Schelling, University of Maryland*+
John Schmitt, Center for Economic and Policy Research
Robert Shapiro, Georgetown University
Heidi Shierholz, Economic Policy Institute
Dan Sichel, Wellesley College
Timothy Smeeding, University of Wisconsin, Madison
Robert Solow, Massachusetts Institute of Technology*+
A. Michael Spence, New York University*
William Spriggs, AFL-CIO
Joseph Stiglitz, Columbia University*
Lawrence Summers, Harvard University
Peter Temin, Massachusetts Institute of Technology
Mark Thoma, University of Oregon
Laura Tyson, University of California, Berkeley
Paula Voos, Rutgers University
* Nobel laureate
+ Has served as American Economic Association president
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Nobel Prize-Winner Elinor Ostrom Dies at 78
Ostrom's work highlighted the power of "the commons"
Jun 12, 2012
Elinor Ostrom, the only woman to receive the Nobel Prize in economics, died today at the age of 78 from cancer.
Indiana University, where Ostrom had been a faculty member, remarked in a statement on her passing that her Nobel-winning work "showed that ordinary people are capable of creating rules and institutions that allow for the sustainable and equitable management of shared resources. Her work countered the conventional wisdom that only private ownership or top-down regulation could prevent a 'tragedy of the commons,' in which users would inevitably destroy the resources that they held in common."
In a 2010 interview with YES! Magazine, Ostrom said in answering what her message to the general public would be, "Some of our mentality about what it means to have a good life is, I think, not going to help us in the next 50 years. We have to think through how to choose a meaningful life where we're helping one another in ways that really help the Earth."
* * *
Indiana University: IU community mourns passing of Distinguished Professor and Nobel Laureate Elinor Ostrom
BLOOMINGTON, Ind. -- The entire Indiana University community mourns the passing today of Distinguished Professor Elinor Ostrom, who received the 2009 Nobel Prize in Economic Sciences for her groundbreaking research on the ways that people organize themselves to manage resources.
Ostrom, 78, died of cancer at 6:40 a.m. today at IU Health Bloomington Hospital surrounded by friends. She was senior research director of the Vincent and Elinor Ostrom Workshop in Political Theory and Policy Analysis, Distinguished Professor and Arthur F. Bentley Professor of Political Science in the College of Arts and Sciences, and professor in the School of Public and Environmental Affairs.
She is survived by Vincent Ostrom, her husband and colleague. She also leaves behind a large extended family of colleagues, collaborators, staff and friends, in Bloomington and on five continents, who worked closely with her during an extraordinary 50-year career.
Ostrom shared the 2009 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, also known as the Nobel Prize in Economic Sciences, with University of California economist Oliver Williamson. She was the first woman and remains the only woman to be awarded the prize.
* * *
Jay Walljasper at On the Commons
Elinor Ostrom's 8 Principles for Managing A Commons
Elinor Ostrom shared the Nobel Prize in Economics in 2009 for her lifetime of scholarly work investigating how communities succeed or fail at managing common pool (finite) resources such as grazing land, forests and irrigation waters. On the Commons is co-sponsor of a Commons Festival at Augsburg College in Minneapolis October 7-8 where she will speak. (See accompanying sidebar for details.)
Ostrom, a political scientist at Indiana University, received the Nobel Prize for her research proving the importance of the commons around the world. Her work investigating how communities co-operate to share resources drives to the heart of debates today about resource use, the public sphere and the future of the planet. She is the first woman to be awarded the Nobel in Economics.
Ostrom's achievement effectively answers popular theories about the "Tragedy of the Commons", which has been interpreted to mean that private property is the only means of protecting finite resources from ruin or depletion. She has documented in many places around the world how communities devise ways to govern the commons to assure its survival for their needs and future generations.
A classic example of this was her field research in a Swiss village where farmers tend private plots for crops but share a communal meadow to graze their cows. While this would appear a perfect model to prove the tragedy-of-the-commons theory, Ostrom discovered that in reality there were no problems with overgrazing. That is because of a common agreement among villagers that one is allowed to graze more cows on the meadow than they can care for over the winter--a rule that dates back to 1517. Ostrom has documented similar effective examples of "governing the commons" in her research in Kenya, Guatemala, Nepal, Turkey, and Los Angeles.
Based on her extensive work, Ostrom offers 8 principles for how commons can be governed sustainably and equitably in a community.
8 Principles for Managing a Commons
1. Define clear group boundaries.
2. Match rules governing use of common goods to local needs and conditions.
3. Ensure that those affected by the rules can participate in modifying the rules.
4. Make sure the rule-making rights of community members are respected by outside authorities.
5. Develop a system, carried out by community members, for monitoring members' behavior.
6. Use graduated sanctions for rule violators.
7. Provide accessible, low-cost means for dispute resolution.
8. Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.
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