Posts Tagged ‘market fundamentalism’
It is one of the neoliberal commandments that innovation in markets can always rectify any perceived problems thrown up by markets in the first place. Thus, whenever opponents on the nominal left have sought to ameliorate some perceived political problem through direct regulation or taxation, the Russian doll of the [neoliberal] thought collective quickly roused itself, mobilized to invent and promote some new market device to supposedly achieve the ‘same’ result. But what has often been overlooked is that, once the stipulated market solution becomes established as a live policy option, the very same Russian doll then also rapidly produces a harsh critique of that specific market device, usually along the lines that it insufficiently respects full market efficiency. This seemingly irrational trashing of neoliberal policy device that had earlier been emitted from the bowls of the [neoliberal thought collective] is not evidence of an unfortunate propensity for self-subversion or unfocused rage against government, but instead an amazingly effective tactic for shifting the universe of political possibility further to the right.
Philip Mirowski, Never Let a Serious Crisis Go to Waste
I’ve argued here before that blaming voters for bad policy or consumers for things like labor conditions is a cop out. (Here and here for voters, here and here for consumers). The general idea is that social outcomes are not a product of unalloyed aggregated individual choice. Institutions matter, power matters. Elites shape the ideas (or people) that can get a serious hearing, and the structure of the choices people get. They work to suppress information and to coopt efforts to challenge them. They make symbolic moves to demobilize those challenges. They act to influence the preferences people hold. Those who hold positions of power and authority are supposed to do things like follow the law, act morally, represent us, etc. When they fail to, it’s their fault – ‘why did you let me?’ is a ridiculous response to a charge of dereliction of duty.
There are often two response to this claim that raise an important point, and addressing them helps me clarify my argument. First is the idea that I’m saying that people have no responsibility to act at all–that I’m essentially leaving them out of the conversation entirely. Second is the idea that saying they aren’t to blame is saying they have no role. Read the rest of this entry »
There is no ‘neutral’ or ‘free’ position: the market is regulated one way or the other. And in either case, there will be economic consequences, concrete distributions of wealth….The question, at the end of the day, is not whether to favor ‘freedom’ or ‘constraint’—in both cases, we are both freely and coercively imposing a legal regime with or without options. The question instead is to determine exactly who benefits and by how much, and more importantly, to assess politically and normatively the justice of those outcomes.
It is precisely that normative assessment that is prevented by faith in natural order and market efficiency. So long as the distributional consequences are viewed as the natural outcome of a natural order, they become far more normal and necessary. Their assessment becomes practically futile, or at least beside the point, for it makes little sense to challenge the justice or appropriateness of such natural outcomes. It is only when we let go of the illusion of natural order that we truly open the door to a full and robust political assessment of those distributional consequences—as well as of the politically and socially produced norms and rules that regulate markets and shape those outcomes.
Barnard Harcourt, The Illusion of Free Markets: Punishment and the Myth of Natural Order
So people are casting about for the means to protect themselves against that insecurity. They are looking for a way to not only afford decent housing but to buy the house in the neighborhood that feeds into the good k-12 schools that will give their own kids a better chance at a life not marred by the insecurity that keeps them up nights. They are looking for a way to be respected at work, to be respected in their communities, to locate their position in the larger social structure and to find it congruent with their ideal selves. They are looking for dignity and rest. That we have constructed the only means for achieving those things as credential hoarding can be understood as “market demand” but I would call it mass insecurity. Again, language, tools, kings and masters.
If we accept my story of profit and higher education market we get to different kinds of questions that lead to different kinds of policies. Rather than disrupting higher education because it does not serve the needs of the market we can ask the market why it does not serve the interests of human beings. Why, as corporations increasingly use their moral authority and political will to limit their tax exposure and their contribution to social institutions like k-12 schools, why is public education being refashioned to provide them the “human capital” they require to continue their abdication of the greater social good?
Tressie McMillan Cottom, Profit, HigherEd and Lessons on the Prestige Cartel
Alex Sparrow has been interested in the idea I’ve been discussing called ‘democratic efficiency.’ He encouraged me to talk a bit more about how to achieve it, and then since has written about this. His post is well worth checking out, and in many ways parallels my own thinking. But his use of the term democratic efficiency and mine are a different, so it seems worth taking the opportunity to explain my own position a bit more clearly. I also noticed as I looked through my posts that I had been defining democratic efficiency differently – by emphasizing different elements of the idea. This no doubt adds to the confusion.
If “economics” is isolated from other aspects of social life, then the criterion for policymakers becomes the simple one of efficiency. Expenditure, and government policy generally, is to be viewed in terms of whether or not a program pays, whether it creates incentives for the private sector to expand output and employment. In a market economy [sic], government must depend on tax collection, and this in turn depends on the level of economic activity–which depends on the expectation of profit. In the economist’s view, if tax incentives can attract or retain business, they should be granted. The income redistribution effects [sic] of such policies may be regressive but this is simply an unavoidable consequence of a market economy: government can step in after production decisions are made and through tax expenditure policies rectify any damage that may have resulted. How much and what type of action it will take will be decided in the political arena.
Yet government, especially at the local level, in under constant pressure not to redistribute from the rich to the poor.
–William K. Tabb, The Long Default : New York City and the Urban Fiscal Crisis.
To allow the market mechanism to be the sole director of the fate of human beings and their natural environment, indeed, even of the amount and use of purchasing power, would result in the demolition of society. For the alleged commodity ‘labour power’ cannot be shoved about, used indiscriminately, or even left unused, without affecting also the human individual who happens to be the bearer of this particular commodity. In disposing of man’s labour power the system would, incidentally, dispose of the physical, psychological, and moral entity ‘man’ [sic] attached to that tag. Robbed of the protective covering of cultural institutions, human beings would perish from the effects of social exposure; they would die as victims of acute social dislocation through vice, perversion, crime and starvation. Nature would be reduced to its elements, neighborhoods and landscapes defiled, rivers polluted, military safety jeopardized, the power to produce food and raw materials destroyed. Finally, the market administration of purchasing power would periodically liquidate business enterprise, for shortages and surfeits of money would prove as disastrous to business as floods and droughts in primitive society.
Karl Polanyi, quoted in David Harvey, A Brief History of Neoliberalism.
I’ve noticed that even when people are sympathetic to the concerns of workers, many people still use the unspoken idea that employers’ right to exploit workers is natural whereas government action to prevent such exploitation is an interference that needs some special justification. Part of this is a failure to notice what the baseline is, and that any choice of baseline is a political act, not one that can be justified by talk of what is ‘natural.’ That is, it is the same mistake that leads people to imagine that ‘redistribution’ is a coherent concept. Thankfully, those who came before us equipped us to avoid such mistakes, if we would only listen.
Chief Justice Charles Evans Hughes:
There is an additional and compelling consideration which recent economic experience has brought into a strong light. The exploitation of a class of workers who are in an unequal position with respect to bargaining power and are thus relatively defenseless against the denial of a living wage is not only detrimental to their health and well being, but casts a direct burden for their support upon the community. What these workers lose in wages the taxpayers are called upon to pay. The bare cost of living must be met. We may take judicial notice of the unparalleled demands for relief which arose during the recent period of depression and still continue to an alarming extent despite the degree of economic recovery which has been achieved. It is unnecessary to cite official statistics to establish what is of common knowledge through the length and breadth of the land. While in the instant case no factual brief has been presented, there is no reason to doubt that the state of Washington has encountered the same social problem that is present elsewhere. The community is not bound to provide what is in effect a subsidy for unconscionable employers. The community may direct its law-making power to correct the abuse which springs from their selfish disregard of the public interest. [my emphasis]
The cost of doing business should, as a matter of course, include the cost of paying a living wage. Companies have no right to impose costs on the rest of us to facilitate their ability to make money.