Traces the development of my 2017 book published by Pluto Press

Capitalist wants government to drive up unemployment by 40-50 per cent and inflict more ‘pain in the economy’ on workers

Two items this Wednesday before the music segment. First, we saw the stark ideology of the elites on full display in Sydney yesterday with a property developer demanding the government increase unemployment by 40-50 per cent to show the workers that the employer is boss and redistribute more national income back to profits. For anyone who doubts the relevance of a framework based on underlying class conflict between labour and capital, then this outburst should eliminate those doubts. On the same day, a leading research group in the welfare sector released an update in their series tracing poverty in Australia. It demonstrated a rising incidence of poverty (nearly 20 per cent of the population) and 1 in 6 children living in impoverished conditions. And the profit takers want more of that to enrich (engorge) themselves even further. A shocking indictment of what has gone wrong with this nation.

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New feudalism seems to forget about the capitalists

It’s Wednesday and I am now more or less settled in my new office which has the sun coming in from the north-east. I was talking to someone yesterday about various things and the topic of neo-feudalism or new feudalism entered the conversation – as you might expect (-: I am deeply suspicious of adding ‘neo’ or ‘new’ to any conceptual term for reasons I will explain. And if you don’t want to know about that then just skip to the end and listen to some great music, as I have been today while working.

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Latest Productivity Commission report – relies on and exploits our ignorance – to undermine our well-being

I had a sense of déjà vu this week when I read the latest release from Australia’s Productivity Commission – Advancing Prosperity – which was released on March 17, 2023 and is a five-yearly exercise conducted by the Commission on behalf of the Australian government. Frankly, if the government was looking to cut spending while advancing material well-being in the community, they could simply tell the Commission to cease doing this work and instruct the staff involved to get real jobs and do something that matters. We just get a regurgitation of GIGO, that well-practiced art of pretending to have something authoritative to say while one is grabbing money out of the till at a rate of knots to advance self-interest! The problem is that the ordinary citizen is ill-equipped to understand any of the technical hoopla that attempts to shroud these types of Report in ‘credibility’, and so is at a disadvantage when trying to determine whether they should support it through the ballot box. Neoliberalism relies on and exploits our ignorance.

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The poorest nations are increasingly beholden to the hedge funds

We kid ourselves when talking about change. I see a lot of Op Ed material recently from the so-called Left that seems to suggest, for example, that those concerned about climate change are really just handing the keys to capital who will use the appetite for ‘change’ to impose punitive policy shifts that will damage the poorer households and communities, while at the same time, strengthen the elite control over income distribution and governments. There are elements on the Left that also think we can ‘heal’ Capitalism – somehow by redefining what ‘capital’ means. This morphs into an assertion that the major problem is that private banks can create credit at will such that we have allowed ‘allowed the credit commons to be privatised’, which in turn drives an unsustainable need for growth to continue to pay interest. I will comment more on that idea in another post – as part of my Degrowth series. But the relevant point here is that Capitalism has created institutions that work to perpetuate the power relations that define who owns capital. These institutions extend to the multi-lateral, government funded organisations such as the IMF and the World Bank, who now function quite differently to the way they were originally conceived. I was thinking about that while reading the latest World Bank publication – International Debt Report 2022 (released December 6, 2022) which captures what is really wrong with Capitalism and leads one to conclude that ‘healing’ requires killing the patient!

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The monetary institutions are the same – but culture dictates the choices we make

In discussions about the significant differences that we have observed over the last 30 odd years between the conduct of economic policy in Japan and elsewhere, the usual response from mainstream economists, when challenged to explain the outcomes in the former nation, is that it is ‘cultural’ and cannot be applied elsewhere. I always found that rather compromising because mainstream economics attempts to be a one-size-fits-all approach based on universal principles of maximising human behaviour. So, by admitting ‘cultural’ aspects to the discussion, this is tantamount to admitting that the ‘market-based’ micro founded approach to macroeconomics is incapable of explaining situations. That is the first black mark against the veracity of mainstream theory. But when one prods further, it becomes clear that the term ‘culture’ is fairly vacuous and blurred in this defense of the mainstream framework. I respond by pointing out that essentially the monetary system dynamics in Japan are identical to the way the system works elsewhere. The institutions might have subtle variations but essentially the operations are so similar that the ‘culture’ bailout doesn’t help resurrect the appalling lack of predictive accuracy when it comes to examining the macroeconomics of Japan. Cultural aspects, however, are crucial to understanding the differences. The trick is understanding how these monetary and fiscal institutions are managed. This is where the cultural aspects impact. And, while I have learned a lot about Japanese cultural nuances, some of the more important ‘cultural’ drivers are transportable to any nation – if only we cared enough and valued people in the same way.

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Radical change is needed and mainstream economics will not be part of the solution

I wrote about what I am terming a ‘poly crisis’ in this recent blog post – The global poly crisis is the culmination of the absurdity of neoliberalism (July 18, 2022). I am working on material for my next book to follow up – Reclaiming the State: A Progressive Vision of Sovereignty for a Post-Neoliberal World (Pluto Books, September 2017). The German word ‘Zeitenwende’ means turning point. A fork in the road. It carries with it, from one interpretation, a recognition that the path that has been traversed to date is not the path that should be followed in the future. Something has to give. Whether Albert Einstein actually said “Insanity is doing the same thing over and over and expecting different results” is an interesting literary issue but the essence of the quote (correctly attributed to him or not) is sound. The idea of a ‘poly crisis’ is that big shifts in thinking and behaviour are required. We simply cannot continue to act in the same way as before whether it be on an individual level (us making our own choices) or at a societal level. The organisation of economic activity, our patterns of consumption and conduct of economic policy must all change – radically – for the planet to survive. Tinkering around the edges will be insufficient. Identifying a ‘poly crisis’ is tantamount to declaring the neoliberal experiment has failed dramatically and taken us all to the brink. It cannot form a basis for the future. But there is massive resistance to change and in Australia in the last week we have seen that in spades.

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We should celebrate the ‘work from home’ phenomenon

We will have Wednesday on a Thursday this week, given my detailed analysis of Australia’s inflation data release yesterday. So today I write less here to write more elsewhere and finish with some of the greatest guitar playing you might ever hope to hear. My topic today is the issue of the ‘work from home’ phenomenon, which is one of the better things Covid has produced. I explain why. But I also realise a lot of commentators view the phenomenon negatively. Some on the Left allege it just means the ‘woke’ class have abandoned the low-paid workers to Covid, while those on the Right are aghast because they realise that, at least, some workers have more ‘control’ over their working lives. My view is that we should celebrate the fact that some workers are happier. I don’t accept the argument from the ‘Left’ commentators that every worker should be miserable if every worker cannot be happier.

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Contrary to what you may have heard – governments can always reduce poverty if they choose to

For years, students have been taught that fiscal policy is an ineffective policy tool to regulate fluctuations in national income derived from changes in spending and saving decisions in the non-government sector. This narrative justified the austerity purges that we have become accustomed to pre-pandemic. The elevation of the fiscal surplus to some desired goal has been instilled in our minds and we have voted to support governments that record these surpluses because we have thought they were being fiscally responsible. The GFC, and, more recently, the pandemic has helped undermine that narrative as people have realised that the only thing between them and hunger has been government spending. The ‘market’ hasn’t helped them. The evidence that government spending has reduced poverty and created opportunities for families that were not previously possible is strong. One such measure is the – Supplemental Poverty Measure (SPM) – which was first published by the US Census Bureau in 2011. This blog post records my notes on that data release.

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Why are the progressive left mixing with the dark right on Covid?

It’s Wednesday and I have been digging a bit into what appears to be a growing coalition opposing lockdowns, mask wearing, vaccine rules, and vaccinations in general. The claims are that none of these things work and that the economy is better off without them. I am not writing today about these matters (I have in the past) but rather about the nature of these coalitions. One of the things that has held back progressive causes in the past is the tendency of social democratic type interests to adopt the mainstream macroeconomics, which not only limits what they can do but exposes them to accusations that the government will run out of money and cause inflation if they have ambitious programs. The pattern of progressive interests aligning with non-progressive voices is thus not new. I am seeing it again in the context of the public health debate, which, in part, explains why our world is in such a Covid-mess. It isn’t all bad today – there is some nice music to finish, being Wednesday.

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To reclaim the state, we have to start with ourselves

One of the joys of living is reading brilliant writing and I read a lot as a consequence. Not all of my reading is brilliant though, as you might expect, given my profession. As a young postgraduate student, one of the best books I read, among many, was – Labor and Monopoly Capital – which was written by – Harry Braverman – and published by the Monthly Review Press in 1974. It was a prescient piece of writing and is still 100 per cent relevant to the struggles today for working people against capital – both industrial and financial. It provides us with a path to resistance. It also points us in the direction of identifying the problems in the world today. And those problems start at the most elemental level – us.

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