[OPE] Ticktin, and the dialectic of the troubles of our times

From: Jurriaan Bendien (adsl675281@tiscali.nl)
Date: Fri Apr 25 2008 - 18:11:27 EDT


I thought of some additional (cryptic) comments, a sort of quick essay. You might say, if you read this piece, "what has this got to do with Marxian political economy?" but the dialectical contradictions of the individual and the social, and how they are mediated or bridged, are precisely what connects the inner world and the outer world, the micro world and the macro world, the minutiae and the big picture. At least that is my understanding of dialectics, when I think through it.

I assume (?) that what Hillel Ticktin really means is that there will be an end to the popular ideology that "the state must get out of the economy" and that there will be a renewed bout of reformist state intervention.
Now if there is a very serious crisis (real GDP growth doesn't just get cut in half, but becomes zero or negative, and unemployment rises above, say, 10%, then such a scenario is likely. But whether it would be "Keynesian" in the technical sense is doubtful, unless you simply equate Keynesianism with state intervention. The total situation does not now favour a "borrow and spend" philosophy - and if redistributing more money to ordinary workers and the poor causes instant capital flight, it is unlikely to be even attempted.

The objective of renewed state intervention would presumably be to facilitate economic growth by creating beter conditions for it. But the existing conditions nowadays, as you note, are different from the conditions to which Keynesianism originally applied. There's been a strong growth of asset speculation and a strong growth in international financial flows, but the benefit to the real economy is proportionally rather small compared to the total capital assets involved. It just means that people who own significant property get richer (but even that isn't always necessarily the case, insofar as assets can be suddenly devalued - ultimately the only secure store of value is resources which people absolutely need to buy).

What could the state really change? Potentially a lot, but without broad support, very little. As regards taxes (the "nerve centre" of bourgeois morality), the US doesn't have very high taxation by European standards, but even so, the federal tax system is bizarre and costly in its complexity, and it rewards/penalizes producers for the wrong reasons, leading to an enormous industry to evade and avoid tax. The biggest chunk of federal tax is payroll tax on labour, which is to say that the main domestic source of economic growth is most strongly penalized. 

As far as reform goes, I would suggest that a "graduated turnover tax" (distinguishing between different categories of production and consumption) and a higher, selective capital gains tax would be a far better idea, compensated for by a lower, graduated tax on labour income among other things. At any rate, I would suggest that an overhaul of the tax system could be very beneficial, and it could be done in a way which does not increase price inflation. But I do not know anybody else who argues this, and it is of course a politically highly charged issue.

I think you are correct, there is as yet an absence of any coherent, comprehensive economic strategy in the US polity, tying together the different threads of the main arguments. That is partly the result of decades of political ideology according to which the state should intervene as little as possible in the economy (though it intervenes more and more in social life), and partly the result of internal political divisions within the propertied classes, i.e. there is a political problem in sustaining alliances that would favour any particular economic growth strategy. There is also an ideological-intellectual crisis, causing considerable nihilism and disorientation.

What sort of growth is beneficial, for example? Good question, but answers to it vary enormously. There is not even a broad consensus about what the real problems the society faces actually are. You see this already in the US election propaganda - what on earth is it about? You tell me. Another aspect is that in reality economic development in the US is occurring more and more unevenly, so you get "growth" zones and "blight" zones in which different categories of people have completely different interests.

Mutatis mutandis (because foreign policy is an extension of domestic policy), the same applies to foreign policy. The same people who are confused about what is happening in their own society, are also confused about geopolitics and how to solve problems there. If you export your own political-cultural problems to other countries, nothing is solved, except that you can say that "they" have the same problems as "we" do. A comforting thought maybe, but it solves nothing, that's the point. The real political challenge is to solve some problems in your own society, and set a good example for others in that sense. 

I have modestly experimented with these contradictions at a very micro sort of level out of naive curiosity or empathy, in my own life, with trials and errors at my own expense, and the results confirm my original idea. As soon as I act as though my own problems are somebody else's problems, or try to solve problems which are for others to solve, nothing good comes of it. Sounds easy, but it is a very tricky and complex area to traverse (also psychologically), because which problems are really personal problems, and which are collective problems? You can no more deny that you are a social being dependent on cooperation from others, than you can deny your own individuality, yet while on the surface there may appear to be harmony between them, there is disharmony beneath.

Modern society has created enormous opportunities for meddling in other people's lives, while at the same time creating enormous opportunities for avoiding social responsibility for collective problems. This creates all kinds of paradoxes and ambiguities intellectuals comment upon, such as, that the more we are connected with each other, the more we find ourselves alone; or, people try to privatise the gains and socialise the losses. That is how people get disaffected, and why politics becomes very confusing. The essence of the matter is papered over with moral rhetorics, which try to mediate the real contradictions, but these rhetorics don't seem to have much efficacy either because they do not make real sense of what actually happens - i.e. real behaviour does not follow axioms.

Perversely, you are asked to take responsibility for many things you can't take responsibility for, and you are unable to assume responsibility for many things that you ought, in a situation where people try to impose their own cultural norms on others (a power game) while fudging who is really responsible for what. This predicament - organisational dysfunctionality - is understandable in the case of puberal or adolescent kids developing towards adult independence. But if a whole society of people reinforces it organisationally by renting out (subcontracting) every problem they do not want to deal with themselves, then how any progressive change can be brought about becomes a mystery, or at any rate an elusive question. 

In regard to the culture of financial speculation, Milan Zeleny observes that "The eternally adolescent generation, nurtured on gaming and gambling, blissfully uninformed and unaware of real things, is perfectly suited for this new casino in the sky." This culturally hegemonic group is sufficiently "wise" to appropriate the goodies of life, but sufficiently "innocent" to avoid any profound confrontation with, or responsibility for, things larger than themselves, other than pet projects. It's like, what can you do, except make your own life a work of art, and stay out of trouble?

In general, you can say that for almost any economic growth strategy you care to devise, some people will be rewarded, and others penalized. There are costs and benefits which cannot be equally distributed among people who occupy very unequal positions. That's okay if the people you reward are in the majority, or at any rate if they have have a lot of political clout. But if that isn't the case, your strategy is not likely to succeed. So economic growth strategies are simultaneously highly political strategies, and the odds are that they will favour the interests of those with the most political clout. You might e.g. get a tax reform, but it might be far from optimal from the point of view of society as a whole. 

The root problem in that sense is that the US is not really a democracy so much as a plutocracy, and outside of election time, there exists no mass political movement of any significant size. That will happen only if the situation forces people into such activity, and if they perceive that they can gain something by that, i.e. if they can see a real positive change for their political activism, that it achieves something. It will most probably take many years yet; most of the political ideologies of political groups outside the main parties in circulation now just don't capture the wider popular imagination, and the mass media mostly don't take them seriously.

There's comparatively little research into what US workers actually want, mostly the question isn't even asked (they are mostly told what they want by ideologists, e.g. Al Gore will sell Green Jobs) - their main tangible concerns are probably with health care, job opportunities and social security, and with relationship culture - but the question of the unequal distribution of income & wealth is not really on the public political agenda, and obviously the plutocrats have no particular interest in putting that on the political agenda. Their argument is that the rich are rich for the benefit of the poor, and that if you are poor, there is something wrong with you. The deeper questions about how the rich get to be rich, and how the poor get to be poor (which Marxists are so concerned with) is not really a topic of popular "debate", and insofar as it is, it's mainly a clash between irreconcilable moral preferences, which therefore does not lead to any new insight or solution.

As regards military expenditure, I agree with Bob Pollin that the wars in Iraq and Afghanistan have been a drain on US economic growth, not an economic stimulus. It has enriched businessmen obviously (which Stiglitz ignores), but the aggregate real economic benefit to the US economy is negative from the point of alternative uses of funds, a net loss. It's unlikely I think that the US government will embark on another major war in the foreseeable future, because they can't afford it, they lack popular support for it, and there is in truth a lack of serious geopolitical threats to the US - just a few "trouble spots" here and there. 

To fight another major war, the politicians would need to capture the popular imagination, and people would have to perceive a real threat justifying military intervention for a clear objective. Because US wars are fought mainly on behalf of business interests, the only way you can "market" a war effort to the populace is by emphasizing the superiority of one culture or group ("friends") over another ("enemies") - but if it isn't even clear anymore why that is, there is a big ideological problem (and an objectivity problem) in justifying the war, or why you would support one group rather than another. 

That aside, there are strong doubts now about what major military intervention can actually achieve, what exactly you gain by it. It is technically relatively easy to bomb a whole society to bits nowadays, but it is not clear that any better society will emerge out of that, or that the opposition will disappear. So the military will most likely continue to operate more a control function in "trouble spots", and most likely there will be more foreign military aid (and covert or propagandistic action) to boost the local power of foreigners who are on your own side. It seems to work - at least, until they turn on you.


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