Eat the Rich.

It's an excerpt from A People’s Guide to Capitalism: An Introduction to Marxist Economics (Haymarket Books, August 2020), which I'll be purchasing.

Concurrently, I'm trying to make a decision about Thomas Piketty's most recent book, Capital and Ideology. Do I try to read it before the election, or after? It might not seem to matter, but somehow does.

Capital and Ideology is an astonishing experiment in social science, one that defies easy comparison. In its ambition, obsessive testimony and sheer oddness, it is closer to the spirit of Karl Ove Knausgård than of Karl Marx. It alternates between sweeping generalities about the nature of justice and the kind of wonkery that one might expect from the Institute for Fiscal Studies, often in the same paragraph. It is occasionally naive (it will bug the hell out of historians and anthropologists) but in a provocative fashion, as if to say: if inequality isn’t justified, why not change it?

Now, to Thier.

Under Capitalism, There’s No Such Thing as a “Fair Day’s Wage for a Fair Day’s Work”, by Hadas Thier (Jacobin)

We’ve got some bad news for you on Labor Day: your boss is exploiting you. Karl Marx explains how.

... Inequality has long been built into the core fabric of the American business model. Pitting black workers against white workers against immigrant workers has been a particularly potent, tried-and-true tactic of employers to drive down all wages. But the cursory sketch laid out here does not even begin to discuss the very many oppressions — of immigrants, of people with disabilities, of gay people, of transgender people, of Native peoples, of elders, and more — that play an integral role in upholding the profitability of US capitalism.

More dismal than Ayn Rand? "Meet the Hidden Architect Behind America's Racist Economics."

Photo credit: Slate.

Meet the man credited with public choice theory -- which means being given little real choice when it comes to oligarchs keeping you down for their further enrichment.

Meet the Hidden Architect Behind America's Racist Economics, by Lynn Parramore (Institute for New Economic Thinking)

Nobel laureate James Buchanan is the intellectual linchpin of the Koch-funded attack on democratic institutions, argues Duke historian Nancy MacLean

Ask people to name the key minds that have shaped America’s burst of radical right-wing attacks on working conditions, consumer rights and public services, and they will typically mention figures like free market-champion Milton Friedman, libertarian guru Ayn Rand, and laissez-faire economists Friedrich Hayek and Ludwig von Mises.

James McGill Buchanan is a name you will rarely hear unless you’ve taken several classes in economics. And if the Tennessee-born Nobel laureate were alive today, it would suit him just fine that most well-informed journalists, liberal politicians, and even many economics students have little understanding of his work.

The reason? Duke historian Nancy MacLean contends that his philosophy is so stark that even young libertarian acolytes are only introduced to it after they have accepted the relatively sunny perspective of Ayn Rand. (Yes, you read that correctly). If Americans really knew what Buchanan thought and promoted, and how destructively his vision is manifesting under their noses, it would dawn on them how close the country is to a transformation most would not even want to imagine, much less accept.

That is a dangerous blind spot, MacLean argues in a meticulously researched book, Democracy in Chains, a finalist for the National Book Award in Nonfiction. While Americans grapple with Donald Trump’s chaotic presidency, we may be missing the key to changes that are taking place far beyond the level of mere politics. Once these changes are locked into place, there may be no going back ...

"Milton Friedman was wrong. Capitalism doesn't foster freedom — it produces autocratic workplaces and tyrannical billionaires."

To continue a barroom conversation ... a complete essay.

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Capitalist Freedom Is a Farce, by Rob Larson (Jacobin)

Milton Friedman was wrong. Capitalism doesn't foster freedom — it produces autocratic workplaces and tyrannical billionaires.

For all the changes of the last fifty years, the conservative classics have held their place surprisingly well. Milton Friedman’s Capitalism and Freedom and Friedrich Hayek’s The Road to Serfdom are still featured on Breitbart’s online bookstore. Rush Limbaugh tells his listeners that “Milton Friedman should be the Bible for young people, or anybody, trying to understand capitalism and free markets.” Charlie Kirk, founder of Turning Point USA, celebrates Hayek and Friedman in his book, while Ben Shapiro holds up Friedman as a conservative icon in National Review.

But what then are the liberty and freedom that conservatives celebrate? And does capitalism advance or restrain them?

Freedom is regarded so highly because in a way it contains all the pleasures of life — it’s the ability to do what you want, within the limits of material conditions and a human lifespan. However you like to spend your time, whoever you love, whatever you like to work on or laugh at, all represent the tremendous value of social freedom.

According to John Stuart Mill, the basic principle of freedom was that “the only purpose for which power can be rightly exercised over any member of a civilized community, against his will, is to prevent harm to others.” The philosopher Isaiah Berlin later described this idea as “negative freedom,” or freedom from coercion by others. Berlin also suggested a “positive freedom” — the freedom to do different things, rather than freedom from the choices of others. Instead of asking, “What power centers control me,” positive freedom asks, “What am I free to do with the world’s opportunities and resources?”

The traditional philosophical view of capitalism is that while it does not provide a “positive freedom” to a fair share of the world’s production of goods, it provides a “negative freedom” from economic tyranny by leaving consumers and workers free to choose among different options. This is the view of Friedman and Hayek, and they insist it’s just the right kind of liberty. Many generations of capitalism’s defenders have agreed.

But any realistic review of the market economy reveals a different picture: capitalism limits both positive and negative freedom. It fosters a huge buildup of private power by concentrating individual wealth and entrenching corporate control over markets (along with mercilessly destroying environmental systems and thus the freedom of future generations). Capitalism not only fails to provide a “positive freedom” to a fair share of the economy — it fails to preserve “negative freedom” from the power plays of the 1 percent’s corporate property.

When GM and Ford decided to desert cities like Detroit and Flint for poorer towns and countries, they denied their former workforce any positive freedom to enjoy the industry’s enormous revenues — revenues the workers themselves had created. When Martin Shkreli’s pharmaceutical company hiked the price of a life-saving patented drug from $13.50 to $750, effectively snatching it away from disease sufferers, it drove dependent users into poverty or bankruptcy — a frightening restriction of negative freedom. When Amazon held a sweepstakes to see which North American city would be blessed with its new headquarters, and mayors across the continent threw billions in tax concessions at the company’s feet, Amazon wielded enormous power over the destiny of millions of people — laying bare how capitalist investment decisions can dramatically limit human liberty.

Capitalism’s defenders insist that, as Friedman and his wife Rose wrote in their book Free To Choose, “When you enter a store, no one forces you to buy. You are free to do so or go elsewhere. . . . You are free to choose.” They applied the same argument to workers: if you don’t like your job or career, find another one.

But other figures have seen the market’s alleged negative freedom quite differently. Consider Frederick Douglass, the escaped slave and self-taught intellectual. He concluded:

Experience demonstrates that there may be a slavery of wages only a little less galling and crushing in its effects than chattel slavery, and that this slavery of wages must go down with the other. . . . The man who has it in his power to say to a man, you must work the land for me for such wages as I choose to give, has a power of slavery over him as real, if not as complete, as he who compels toil under the lash. All that a man hath he will give for his life.

Here Douglass was suggesting that markets allow the exercise of unaccountable power — the enemy of freedom. But how could a free person be “enslaved” to wages, with so many different options for purchasing goods and finding different careers?

One answer, as critics of capitalism have pointed out for centuries, is that markets concentrate and often tend toward monopoly. From the well-known Gilded Age monopolies in oil and steel to the Silicon Valley tech giants of today, the dynamics of capitalism generate unbelievable concentrations of private power. And while antitrust law is intended to constrain such monopolies, as the eminent economist Alfred Chandler pointed out long ago, commenting on the 1890 Sherman Act, at best such statutes tend to “create oligopoly where monopoly existed and to prevent oligopoly from becoming monopoly.” Large agglomerations of unaccountable power — not the freedom-enhancing markets of Friedmanite fantasies — are the stuff of mature capitalism.

Douglass’s larger point, however, was that market economies treat basic necessities as commodities to be bought and sold, including food and shelter. Capitalism compels people to find work in labor markets, on such terms as they can find and subject to the tyrannical rule of jumped-up capitalist bullies, from Rockefeller to Bezos.

This is a radical infringement on positive and negative liberty. In order to get the rudiments of life, most people must submit to the utter dictatorship of the modern workplace — the day-to-day schedule changes, the dressings-down, the restrictions on freedom of speech. No wonder Douglass added: “As the laborer becomes more intelligent he will develop what capital he already possess — that is the power to organize and combine for its own protection.” Collective organization by workers — that bugaboo of capitalist partisans like Friedman — was the true guarantor of freedom.

But wait — Friedman and company say they have a trump card: “Since the household always has the alternative of producing directly for itself,” Friedman wrote in Capitalism and Freedom, “it need not enter into any exchange unless it benefits from it.” The power of “exit” restricts the potentially coercive power of the labor market.

Yet Friedman’s picture of the average family is so rosy it borders on the oblivious. What he refuses to recognize is that producing goods typically requires capital, the tools and equipment used to make products.

And capital is enormously concentrated. Inequality scholar Thomas Piketty has found that the richest 10 percent of US households own 70 percent of total national wealth, and the top 1 percent alone owns 35 percent. Crucially, corporate stock, which represents ownership of the productive capital that’s required to make goods and thus enable people to “produce for themselves,” is just as concentrated, with the richest 5 percent of households holding 67 percent of US equities, according to the Economic Policy Institute.

Somehow the Chicago School Nobelist fails to realize that the average individual — the individual around which his entire philosophy is allegedly based — is held hostage to the whims of those who own the productive economy, who can decide how wretched our work lives will be and which cities will get to have an economic future. From break times to ergonomics to maternity leave to acceptable workplace speech, the upper crust calls the shots and makes a mockery of “capitalist freedom.”

Liberals, for their part, are often prepared to push for more “positive freedom” in the form of entitlements to health care, education, and a safe environment. But democratic control over investment and production would represent a far more promising model for liberty, since achieving worker control would replace capitalism’s profit motive with solidarity — the drive to support and collaborate with our fellow men and women.

Doing so would end giant firms’ power to sweep the legs out from under a major city by relocating overseas, or to ruin their employees’ work lives by speeding up production or surveilling them. Decisions made by cooperatives of workers, elected and subject to recall by their colleagues, could be made in a matrix of social solidarity and thus significantly limit the power-mongering we’re used to from today’s corporate world.

We on the Left cannot surrender the language of freedom to the Right. Having a critical analysis of capitalist corporations is great, but socialists must also promote the transformative potential of socialist freedom — both to inspire the hard work needed to change the world and to give our struggles a north star.

In The Road to Serfdom, Hayek grudgingly laments that “the promise of greater freedom has become one of the most effective weapons of socialist propaganda.” Hear, hear!

UK election aftermath: "Any radicalism that fails to ask the really thorny questions isn’t radical at all."

It would be a mistake to read too much into the (soon to be dis-) United Kingdom's election. Something had to happen with respect to Brexit, and it did. Conditions in America, while mind-numbing in their own sordid way, cannot be compared with Brexit fatigue, which played out like one of those sieges in medieval times.

During the course of analyzing Labour's debacle, the columnist offers two questions and a comment that are highly applicable to present-day conditions here. I've placed them in bold.

Maybe it's just me, but thus far amid our seemingly endless presidential campaign, only Bernie Sanders seems to be addressing truly fundamental economic questions. The rest of it is little more than slightly differing ways to appease the needs of capital accumulation.

Spare me the Buttigieg bluff. He's a Republican in all but name. I'll vote for Sanders until I can't, then I'll reassess.

This Labour meltdown has been building for decades, by Aditya Chakrabortty (The Guardian)

 ... Any radicalism that fails to ask the really thorny questions isn’t radical at all. In Britain in 2019, those include: against rampant inequality and climate change, what’s the economy for? What do the public actually want from politics and economics?

In the 2017 election I wrote that a party that grew out of social institutions needed to turn itself into a social institution in precisely those areas it historically took for granted. That remains the key task: providing advice to those whose benefits are being slashed, legal support to tenants under the cosh from their landlords, haggling with the utilities to provide cheaper and better deals. Add to that: teaching political and economic literacy to voters, not just activists, and consulting constituents on what issues Labour should be battling on.

None of this is as easy as getting the woman with the great backstory to run No 11, or some GCSE marketing talk about finding new “narratives”. It’s hard graft, and it won’t make good copy. But Labour has no God-given right to expect votes, let alone to govern. It needs to renew its contract with its base. The big question is whether it wants to.

Even without Trump's one-percenters and Boris's Brexiteers, "Neoliberalism has reached its Brezhnev phase."

Because the way out from detrimental neoliberalism isn't more of the same.

What we are finding with Neoliberalism Economicus is that it is not adaptive for individuals or societies. Rather it works like a parasite that bleeds energy away from its host with false stories that appear beneficial at first but are ultimately deadly. The virus grows by perpetuating fictions. These fictions are attractive because their appeal does not rely on facts but rather on the need for power and status. The neoliberal narrative has remained compelling in part because it appeals to powerful interests in society and those who emulate them.

Can someone find us a big-ass trash can, ashcan, ash heap, dustbin, dust heap or garbage heap? We'll be needing one, the other or them all to deposit the remains of neoliberalism.

The insidious ideology pushing us towards a Brexit cliff-edge, by George Monbiot (The Guardian)

At first sight it’s incomprehensible. Why risk everything for a no-deal Brexit? Breaking up their own party, losing their parliamentary majority, dismantling the UK, trashing the economy, triggering shortages of food and medicine: how could any objective, for the Conservative and Unionist party, be worth this? What good does it do them?

Yes, some people will benefit. To judge by recent donations to the Conservative party, some very rich people approve of Boris Johnson’s policies. A no-deal Brexit might favour hedge funds that thrive on uncertainty, financiers seeking to short the pound, vulture capitalists hoping to mop up cheap property if markets collapse. But the winners are likely to be greatly outnumbered by the losers, among whom are many powerful commercial interests.

We make a mistake when we assume that money is the main motivation. Our unreformed, corrupt and corrupting political funding system ensures it is an important factor. But what counts above all else is ideology, as ideology successfully pursued is the means to power. You cannot exercise true power over other people unless you can shape the way they think, and shape their behaviour on the basis of that thought. The long-term interests of ideology differ from the short-term interests of politics.

This, I believe, is the key to understanding what is happening today. The Brexit ultras in government are not just Brexit ultras. They are neoliberal ultras, and Brexit is a highly effective means of promoting this failed ideology. It’s the ultimate shock doctrine, using a public emergency to justify the imposition of policies that wouldn’t be accepted in ordinary times. Whether they really want no deal or not, the threat of it creates the political space in which they can apply their ideas ...

Deep reading, premises readied for questioning: "Money must become our servant, rather than our master."

Gahan's okay with money as we know it. 

Just about the first lesson any philosophy student learns is to question all the premises. Do the things one takes for granted survive scrutiny? I became a philosophy student at IU Southeast in the fall of 1978, it got real very quickly: Do grades mean what we think they do?

We gathered at a classroom in Hillside Hall, and Prof. McCarthy greeted us with a warning, which I now paraphrase:

“Welcome to Philosophy 101. If you’ve chosen the university experience as a means of compiling a perfect 4.0 GPA, then I recommend you drop this class and choose another, because I do not award perfect scores. There is no such thing as perfection, and if you disagree with me, be prepared to argue your case logically. It won’t matter, because you’ll still not receive an A for this class. Would anyone like to discuss the nature of perfection?”

Does money mean what we think it does?

Neoliberalism has tricked us into believing a fairytale about where money comes from, by Mary Mellor (The Conversation)

There is nothing natural about money. There is no link to some scarce essential form of money that sets a limit to its creation. It can be composed of base metal, paper or electronic data – none of which is in short supply. Similarly – despite what you may have heard about the need for austerity and a lack of certain cash-generating trees – there is no “natural” level of public expenditure. The size and reach of the public sector is a matter of political choice.

Which puts austerity, the culling of expenditure in the public economy, under some question. For some countries, such as Greece, the impact of austerity has been devastating. Austerity policies still persist despite numerous studies arguing that they were entirely misconceived, based on political choice rather than economic logic. But the economic case for austerity is equally mistaken: it is based on what can best be described as fairytale economics ...

"Reaganomics killed America's middle class," and "the old deal that held US society together started to unwind."

Photo credit.

Following are two topics raised during the Tuesday "Chew On This" discussion about what divides Americans.

Tuesday night, we chewed on THAT.

Starting the conversation here.

A return to Piketty: "Reaganomics killed America's middle class."

There’s nothing “normal” about having a middle class. Having a middle class is a choice that a society has to make, and it’s a choice we need to make again in this generation, if we want to stop the destruction of the remnants of the last generation’s middle class ...

... Capitalism is not an economic system that produces a middle class. In fact, if left to its own devices, capitalism tends towards vast levels of inequality and monopoly. The natural and most stable state of capitalism actually looks a lot like the Victorian England depicted in Charles Dickens’ novels.

Continuing it here.

Decline and fall: how American society unravelled, by George Packer (The Guardian)

Thirty Forty years ago, the old deal that held US society together started to unwind, with social cohesion sacrificed to greed. Was it an inevitable process – or was it engineered by self-interested elites?

 ... The large currents of the past generation – deindustrialisation, the flattening of average wages, the financialisation of the economy, income inequality, the growth of information technology, the flood of money into Washington, the rise of the political right – all had their origins in the late 70s. The US became more entrepreneurial and less bureaucratic, more individualistic and less communitarian, more free and less equal, more tolerant and less fair. Banking and technology, concentrated on the coasts, turned into engines of wealth, replacing the world of stuff with the world of bits, but without creating broad prosperity, while the heartland hollowed out. The institutions that had been the foundation of middle-class democracy, from public schools and secure jobs to flourishing newspapers and functioning legislatures, were set on the course of a long decline. It as a period that I call the Unwinding.

In one view, the Unwinding is just a return to the normal state of American life. By this deterministic analysis, the US has always been a wide-open, free-wheeling country, with a high tolerance for big winners and big losers as the price of equal opportunity in a dynamic society. If the US brand of capitalism has rougher edges than that of other democracies, it is worth the trade-off for growth and mobility. There is nothing unusual about the six surviving heirs to the Walmart fortune possessing between them the same wealth as the bottom 42% of Americans – that's the country's default setting. Mark Zuckerberg and Bill Gates are the reincarnation of Henry Ford and Andrew Carnegie, Steven Cohen is another JP Morgan, Jay-Z is Jay Gatsby.

The rules and regulations of the Roosevelt Republic were aberrations brought on by accidents of history – depression, world war, the cold war – that induced Americans to surrender a degree of freedom in exchange for security. There would have been no Glass-Steagall Act, separating commercial from investment banking, without the bank failures of 1933; no great middle-class boom if the US economy had not been the only one left standing after the second world war; no bargain between business, labour and government without a shared sense of national interest in the face of foreign enemies; no social solidarity without the door to immigrants remaining closed through the middle of the century.

Once American pre-eminence was challenged by international competitors, and the economy hit rough seas in the 70s, and the sense of existential threat from abroad subsided, the deal was off. Globalisation, technology and immigration hurried the Unwinding along, as inexorable as winds and tides. It is sentimental at best, if not ahistorical, to imagine that the social contract could ever have survived – like wanting to hang on to a world of nuclear families and manual typewriters ...

"Why Marx’s Capital Still Matters."

David Harvey's answers at Jacobin are clear and concise. Readers are urged to read the entire interview. It's very rewarding.

Why Marx’s Capital Still Matters, interview by Daniel Denvir (Jacobin)

David Harvey on why Karl Marx's Capital is still the defining guide to understanding — and overcoming — the horrors of capitalism.

It’s been more than a century and a half since Karl Marx published the first volume of Capital. It’s a massive, intimidating tome — one that many readers might be tempted to skip. Radical scholar David Harvey doesn’t think you should.

Harvey has taught Capital for decades. His popular courses on the book’s three volumes are available for free online and have been watched by millions around the world; they were the basis for his companion books to volumes one and two. Harvey’s latest book, Marx, Capital, and the Madness of Economic Reason is a shorter companion to all three volumes. In it, he deals with the fundamental irrationality of a capitalist system whose functioning is supposed to be anything but.

Harvey spoke with Daniel Denvir for Jacobin Radio’s podcast The Dig, about the book, capital’s simultaneous creative and destructive forces, climate change, and why Capital is still worth wrestling with.

Here are three excerpts, beginning with "bad infinity."

DD
One reason that it’s important is that we need it to understand this dynamic of constant expansion that drives capitalism — what you call a “bad infinity,” citing Hegel. Explain what this “bad infinity” is.

DH
You get this idea of a “bad infinity” in volume one. The system has to expand because it’s always about profit, about creating what Marx called a “surplus value,” and the surplus value then gets reinvested in the creation of more surplus value. So capital is about constant expansion.

And what that does is this: if you grow at 3 percent a year, forever, then you get to the point where the amount of expansion required is absolutely huge. In Marx’s time, there’s plenty of space in the world to expand into, whereas right now we’re talking about 3 percent compounding rate of growth on everything that’s happening in China and South Asia and Latin America. The problem arises: where are you going to expand into? That’s the bad infinity coming into being.

In volume three, Marx says maybe the only way it can expand is by monetary expansion. Because with money there’s no limit. If we’re talking about using cement or something like that, there’s a physical limit to how much you can produce. But with money, you can just add zeroes to the global money supply.

If you look at what we did after the 2008 crisis, we added zeroes to the money supply by something called “quantitative easing.” That money then flowed back into stock markets, and then asset bubbles, especially in property markets. We’ve now got a strange situation where, in every metropolitan area of the world that I’ve visited, there’s a huge boom in construction and in property asset prices — all of which is being fueled by the fact that money is being created and it doesn’t know where to go, except into speculation and asset values.

Then, the "madness of economic reason."

DD
It’s precisely that issue of credit that led you to borrow a phrase from Jacques Derrida, “the madness of economic reason.” Colloquially, madness and insanity are invoked to stigmatize or pathologize individuals with mental illness. But what Marx shows us, and what your book shows us, is that the system is actually insane.

DH
The best measure of that is to look at what happens in a crisis. Capital produces crises periodically. One of the characteristics of a crisis is that you have surpluses of labor — people unemployed, not knowing how to make a living — at the same time you have surpluses of capital that don’t seem to be able to find a place to go to get an adequate rate of return. You have these two surpluses sitting side by side, in a situation where social need is chronic.

We need to put capital and labor together to actually create things. But you can’t do that, because what you want to create is not profitable, and if it’s not profitable then capital doesn’t do it. It goes on strike. So we end up with surplus capital and surplus labor, side by side. That is the height of irrationality.

We’re taught that the capitalist economic system is highly rational. But it’s not. It actually produces incredible irrationalities.

Finally, the amorality of capital.

DD
You wrote in Jacobin recently that Marx broke with moralist socialists like Proudhon, Fourier, Saint-Simon, and Robert Owen. Who were these socialists, and why and how did Marx part from them?

DH
In the early stages of capitalist development, there were obvious problems of conditions of labor. Reasonable people, including professionals and the bourgeoisie, started to look at this with horror. A sort of moral repugnance against industrialism developed. Many of the early socialists were moralists, in the good sense of that term, and expressed their outrage by saying, we can construct an alternative society, one based on communal wellbeing and social solidarities, and issues of that kind.

Marx looked at the situation and said actually, the problem with capital is not that it’s immoral. The problem with capital is that it’s almost amoral. To try to confront it with moral reason is never going to get very far, because the system is self-generating and self-reproducing. We’ve got to deal with that self-reproduction of the system.

Marx took a much more scientific view of capital and said, now we actually need to replace the whole system. It’s not just a matter of cleaning up the factories — we’ve got to deal with capital.

The morning Constitutional: "It is capitalism that must be overcome to solve its inherent inequality problem."

Certain lessons therein.

I'm old, and the memory gets hazy.

Can someone refer me to to section of the Constitution where it stipulates capitalism?

On a daily basis since kindergarten, someone always is hovering near, insisting I must worship something, whether god, flag or economic system.

I still feel the same as I always have. For so long as they're tolerable, okay -- but stay off my porch, please. Indoctrination never has been confined to a particular system of thought. Sorry, but I'd rather drink myself to death.

Following are three articles about capitalism -- directly as well as indirectly.

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Capitalism as Obstacle to Equality and Democracy: the US Story, by Richard D. Wolff (CounterPunch)

The conclusion to be drawn from the US story is not that efforts to reverse deepening inequality are foredoomed to failure. It is to face the fact that mere reforms such as tax law changes are inadequate to the task. To make reforms stick – to overcome temporariness across so many histories – requires going further to basic system change. Because capitalism tends toward deepening inequality and can defeat reversals by keeping them temporary, it is capitalism that must be overcome to solve its inherent inequality problem.

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When Capitalists Go on Strike, by Kevin Young, Michael Schwartz and Tarun Banerjee (Jacobin)

... Capitalists routinely exert leverage over governments by withholding the resources — jobs, credit, goods, and services — upon which society depends. The “capital strike” might take the form of layoffs, offshoring jobs and money, denying loans, or just a credible threat to do those things, along with a promise to relent once government delivers the desired policy changes.

Government officials know this power well, and invest great energy and public resources in staving off fits by malcontent capitalists. The profoundly rotten campaign finance system is just one manifestation of business’s domination over government policy. The real power resides in the corporate world’s monopoly over the flow of capital.

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Buddhist Economics: How to Start Prioritizing People Over Products and Creativity Over Consumption, by Maria Popova (Brain Pickings)

Much has been said about the difference between money and wealth and how we, as individuals, can make more of the latter, but the divergence between the two is arguably even more important the larger scale of nations and the global economy. What does it really mean to create wealth for people — for humanity — as opposed to money for governments and corporations?

That’s precisely what the influential German-born British economist, statistician, Rhodes Scholar, and economic theorist E. F. Schumacher explores in his seminal 1973 book Small Is Beautiful: Economics as if People Mattered — a magnificent collection of essays at the intersection of economics, ethics, and environmental awareness.

Long read, must read: "Neoliberalism: the idea that swallowed the world."

I've been holding onto this one in the hope that I'd come up with something glib to add, but I haven't. It's one of the finest summaries of "neoliberalism" I've have read this year.

Neoliberalism: the idea that swallowed the world, by Stephen Metcalf (The Guardian)

The word has become a rhetorical weapon, but it properly names the reigning ideology of our era – one that venerates the logic of the market and strips away the things that make us human. 

 ... Peer through the lens of neoliberalism and you see more clearly how the political thinkers most admired by Thatcher and Reagan helped shape the ideal of society as a kind of universal market (and not, for example, a polis, a civil sphere or a kind of family) and of human beings as profit-and-loss calculators (and not bearers of grace, or of inalienable rights and duties). Of course the goal was to weaken the welfare state and any commitment to full employment, and – always – to cut taxes and deregulate. But “neoliberalism” indicates something more than a standard rightwing wish list. It was a way of reordering social reality, and of rethinking our status as individuals.

Still peering through the lens, you see how, no less than the welfare state, the free market is a human invention. You see how pervasively we are now urged to think of ourselves as proprietors of our own talents and initiative, how glibly we are told to compete and adapt. You see the extent to which a language formerly confined to chalkboard simplifications describing commodity markets (competition, perfect information, rational behaviour) has been applied to all of society, until it has invaded the grit of our personal lives, and how the attitude of the salesman has become enmeshed in all modes of self-expression.

In short, “neoliberalism” is not simply a name for pro-market policies, or for the compromises with finance capitalism made by failing social democratic parties. It is a name for a premise that, quietly, has come to regulate all we practise and believe: that competition is the only legitimate organising principle for human activity.

Book: "The happy few: Why the 20%, and not the 1% are the real problem."

The book is called, Dream Hoarders: How the American Upper Middle Class Is Leaving Everyone Else in the Dust, Why That Is a Problem, and What to Do about It. by Richard Reeves.

I haven't read it, at least yet. Thomas Piketty surely exhausted my patience for hardcore economics in one calendar years.

There'll come a time ...

The happy few: Why the 20%, and not the 1% are the real problem (The Economist)

It’s the upper middle class who are the main beneficiaries—and the principal cause—of inequality in America

WHICH of America’s social fault lines is most dangerous? Race remains as wide a rift as ever. Supporters of Bernie Sanders seethe at the richest 1%. Donald Trump won office exploiting the cultural chasm between an urban, cosmopolitan America and the rest. But if America’s woes are rooted in the inaccessibility of the American dream, the increasingly impenetrable barrier around those who manage to achieve it is the place to probe.

That is where Richard Reeves, a scholar at the Brookings Institution, a think-tank, aims his fire in “Dream Hoarders”: at America’s richest fifth, its upper middle class. Having grabbed their piece of prosperity, the upper middle class are fighting like hell to keep it. They—which is to say you, in all probability—are the problem.

Mr Reeves, who is British and recently emigrated to America, is perhaps better positioned than most to recognise class barriers for what they are. Whereas worry over inequality commonly focuses on eye-popping growth in incomes among the very rich, he notes that it is this top 20% as a whole which has pulled away. Between 1979 and 2013, average incomes for the bottom 80% of American households rose by 42% (adjusted for price changes). By contrast, those of the next richest 19% rose by 70%, and of the top 1% by 192%. This upper middle class stands apart from the rest of America in a number of ways: in terms of wealth and incomes, in educational attainment—perhaps the most salient of status markers—and broader health ...

7 Days of Piketty: Thursday, or "Squeezing the rich ... if the world introduces a Piketty Tax."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century. Piketty has been criticized for having no "solution" to inequality apart from a global wealth tax, deemed impractical by most observers.

Today it's back to The Economist for an examination of the prospects and effects of such a tax. This brings me to the conclusion of the "7 Days of Piketty," and let me tell you -- I'm ready for a nice novel.

Squeezing the rich ... if the world introduces a "Piketty Tax" (The Economist)

Thomas Piketty, a superstar economist, favours the introduction of a global wealth tax. Its impact might be surprisingly small

IN A speech in 2013 Barack Obama labelled inequality “the defining challenge of our time”. A few months later a book on the subject by Thomas Piketty, an economist at the Paris School of Economics, became an unlikely bestseller. It walked readers through centuries of data and a theory of inequality before leaving them with a bold policy recommendation: to prevent a dangerous rise in the concentration of wealth, the world’s governments ought to co-operate to enact a global wealth tax.

Egalitarian themes remain popular on campaign trails, but the wealth-tax idea has so far failed to gain ground. Yet in the right circumstances, might a “Piketty tax” emerge from the messy world of democratic politics?

7 Days of Piketty: Wednesday, or "Piketty's Three Big Mistakes."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century.

Today, another critic.

Piketty's Three Big Mistakes, by Noah Smith (Bloomberg View)

 ... Rognlie has three observations that cast doubt on Piketty’s big thesis.

The first is that Piketty doesn’t take depreciation into account. As capitalists accumulate more and more machines, buildings and other hard assets they have to pay more and more to maintain that physical capital. Trucks need new tires. Offices need renovation. What Rognlie notices is that this upkeep cost has been increasing over time.

Nowadays, more than in the past capital goods are often in the form of computers, software and other high-tech products that go obsolete very quickly. That means that capitalists have to spend more money replacing these things. A lot of what looks like more money going into owners’ pockets is really just an increased cost of doing business.

Rognlie isn't the first to make this point -- it has been made by James Hamilton of the University of California-San Diego and by Benjamin Bridgman of the Bureau of Economic Analysis.

But Rognlie adds two other important points ...

7 Days of Piketty: Tuesday, or "Egalitarianism’s Latest Foe: a critical review of Thomas Piketty’s Capital in the Twenty-First Century."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century. Prior to reading the book, my friend Brandon warned me that it wouldn't improve my mood.

It didn't, and reading the book evidently did nothing for Yanis Varoufakis' mood, either. Varoufakis gives a leftist economist's reply to Piketty here. Just know that the fundamental point is the difference between wealth and capital, and the truths flowing from this difference. Pour a stiff drink first. It took me a while to get through it.

I'm still interested in pitchfork acquisition.

Egalitarianism’s Latest Foe: a critical review of Thomas Piketty’s Capital in the Twenty-First Century, by Yanis Varoufakis (Paecon)

The commercial and discursive triumph of Thomas Piketty’s Capital in the 21st Century symbolises this turning point in the public’s mood both in the United States and in Europe. Capitalism is, suddenly, portrayed as the purveyor of intolerable inequality which destabilises liberal democracy and, in the limit, begets chaos. Dissident economists, who spent long years arguing in isolation against the trickle-down fantasy, are naturally tempted to welcome Professor Piketty’s publishing phenomenon.

The sudden resurgence of the fundamental truth that the best predictor of socio-economic success is the success of one’s parents, in contrast to the inanities of human capital models, is undoubtedly uplifting. Similarly with the air of disillusionment with mainstream economics’ toleration of increasing inequality evident throughout Professor Piketty’s book. And yet, despite the soothing effect of Professor Piketty’s anti-inequality narrative, this paper will be arguing that Capital in the 21st Century constitutes a disservice to the cause of pragmatic egalitarianism ...

7 Days of Piketty: Monday, or "The Geography of Populist Discontent."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century. Prior to reading the book, my friend Brandon warned me that it wouldn't improve my mood.

He was right.

Pitchforks, anyone?

We continue with a consideration of inequality's contribution to populist discontent.

The Geography of Populist Discontent, by Richard Florida (CityLab)

“There are times when rational, well-educated societies lose a sense of perspective,” says urban scholar Josef Konvitz. The global populist backlash represents one of those times.

 ... The current discussion focuses primarily on stagnant or declining real incomes, and hence on widening disparities between most people and the top 1 percent or 5 percent by income. Productivity is increasing at a lower rate. And, as Robert Gordon argues, we seem to be living off innovations that are decades old. Thomas Piketty’s Capitalism in the Twenty-First Century and Angus Deaton’s The Great Escape, both published in 2013, emphasized a long historical perspective, the importance of cultural values, and the impact of meta-events, usually overwhelming catastrophes, that separate one phase, often lasting decades, from another. These studies, however, look at large social categories and the unit of the nation-state, ignoring spatial variations within countries or in the distribution of social and cultural groups.

The decline of the middle class and the broken escalator of social mobility are no fiction. Before the 2016 U.S. election, Le Monde published maps about the geography of disparities in the U.S. Did you know that the size of the middle class shrank by more than 7 percent between 2000 and 2013 in New England, New Jersey, Delaware, Virginia, the Carolinas, Mississippi, Ohio, Indiana, Illinois, Wisconsin, Minnesota, North Dakota, Oregon, Washington, Nevada, Colorado, New Mexico and Arizona? Some of these were red states, others blue. But the trend shaped the political narrative.

Another map showed that the chances of a child born into a family at the lowest level of poverty ever reaching the upper level of income were under 6 percent in virtually all parts of the South, as well as much of Michigan, Ohio, Kentucky, and Indiana.

The spatial perspective comes into sharper focus when we look at indirect measurements such as the higher cost of rental housing, declining real incomes, the burden of debt for home ownership, the cost of commuting by car, pressure on infrastructure capacity—things that matter in daily life and for which people have no elasticity, meaning that they cannot find better or less expensive ways of doing things. Pressures build up. These indirect indicators highlight how the organization of housing and work in particular places can generate problems that accumulate. As Jane Jacobs famously said, when this happens, problem solving has broken down.

7 Days of Piketty: Sunday, or "Why Economic Inequality Threatens Our Republic."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century. Piketty generally has been praised for the sheer depth of his research, and criticized for failing to offer a solution to the problem of inequality apart from a global tax on wealth, which strikes most observers as unlikely.

Pitchforks, anyone?

We continue with a consideration of another book, this one about inequality's potential threat to our system of government.

It’s Not Just Unfair: Inequality Is a Threat to Our Governance, by Angus Deaton (New York Times)

THE CRISIS OF THE MIDDLE-CLASS CONSTITUTION
Why Economic Inequality Threatens Our Republic
By Ganesh Sitaraman
423 pp. Alfred A. Knopf. $28.

President Obama labeled income inequality “the defining challenge of our time.” But why exactly? And why “our time” especially? In part because we now know just how much goes to the very top of the income distribution, and beyond that, we know that recent economic growth, which has been anemic in any case, has accrued mostly to those who were already well-heeled, leaving stagnation or worse for many Americans. But why is this a problem?

Why am I hurt if Mark Zuckerberg develops Facebook, and gets rich on the proceeds? Some care about the unfairness of income inequality itself, some care about the loss of upward mobility and declining opportunities for our kids and some care about how people get rich — hard work and innovation are O.K., but theft, legal or otherwise, is not. Yet there is one threat of inequality that is widely feared, and that has been debated for thousands of years, which is that inequality can undermine governance. In his fine book, both history and call to arms, Ganesh Sitaraman argues that the contemporary explosion of inequality will destroy the American Constitution, which is and was premised on the existence of a large and thriving middle class. He has done us all a great service, taking an issue of overwhelming public importance, delving into its history, helping understand how our forebears handled it and building a platform to think about it today.

As recognized since ancient times, the coexistence of very rich and very poor leads to two possibilities, neither a happy one. The rich can rule alone, disenfranchising or even enslaving the poor, or the poor can rise up and confiscate the wealth of the rich. The rich tend to see themselves as better than the poor, a proclivity that is enhanced and even socially sanctioned in modern meritocracies. The poor, with little prospect of economic improvement and no access to political power, “might turn to a demagogue who would overthrow the government — only to become a tyrant. Oligarchy or tyranny, economic inequality meant the end of the republic.”

7 Days of Piketty: Saturday, or "All men are created unequal."

I'm publishing seven days of links to web material about Thomas Piketty and his book, Capital in the Twenty-first Century. Piketty generally has been praised for the sheer depth of his research, and criticized for failing to offer a solution to the problem of inequality apart from a global tax on wealth, which strikes most observers as unlikely.

Pitchforks, anyone?

We continue with The Economist, circa 2014: "Revisiting an old argument about the impact of capitalism."

All men are created unequal (The Economist)

INEQUALITY is one of the most controversial attributes of capitalism. Early in the industrial revolution stagnant wages and concentrated wealth led David Ricardo and Karl Marx to question capitalism’s sustainability. Twentieth-century economists lost interest in distributional issues amid the “Great Compression” that followed the second world war. But a modern surge in inequality has new economists wondering, as Marx and Ricardo did, which forces may be stopping the fruits of capitalism from being more widely distributed.

“Capital in the Twenty-First Century” by Thomas Piketty, an economist at the Paris School of Economics, is an authoritative guide to the question. Mr Piketty’s book, which was published in French in 2013 and will be released in English in March 2014, self-consciously builds on the work of 19th-century thinkers; his title is an allusion to Marx’s magnum opus. But he possesses an advantage they lacked: two centuries’ worth of hard data.

7 Days of Piketty: Friday, or "Capital in the Twenty-first Century' explained."

My esteemed friend Kim Andersen has no tolerance for fake news; it's only the real thing for Big Kim, and as such, he forwarded to a group of friends this important link to an article in a British newspaper.

“Going to the pub together keeps male friendships strong, suggests scientist, whereas female friendships are strengthened by communication.”

A fellow recipient quickly replied, “It’s always nice when science confirms the obvious.”

Having finally gotten down to the business of reading Thomas Piketty’s Capital in the Twenty-first Century, I can concur with this conclusion.

Most of us have long since grasped that since human planetary times began, a relatively small proportion of the planet’s population has acquired and hoarded a disproportionate amount of wealth.

I dimly recall the testimony of one or the other Greek philosopher to the effect that if we evenly distributed wealth among the population, it would be a futile gesture, as quickly the proportion would return to its previous imbalance.

Piketty sets out to prove the persistence of inequality, using statistics from as far back as the French Revolution -- when the top 1% controlled about 98% of the wealth in France. Insofar as inequality has lessened in the world since then, it's because tumultuous wars (I and II) and confiscatory tax rates had the effect of redistributing wealth.

In short, we're back to a widening gap between the haves and have-nots -- something obvious, though it's nice to have academic support.

It would seem that Piketty did his best to write for numbskulls like me, patiently explaining esoteric concepts, and loading the pages with charts and graphs. Still, I made the editorial decision to skim where merited, and concentrated on the summaries and high points -- and these high points are collected in the overview below.

Interestingly, upon the book's release, economists on the “left” criticized Piketty for defining capital as aggregate wealth. Had Yanis Varoufakis not been called to the Greek finance ministry in 2015, he might have embarked on a lucrative career as left-wing debunker of Piketty, accusing the Frenchman of conflating wealth with capital.

And yet even Varoufakis didn't contest the overall conclusion -- a small percentage of humans controls a disproportionate amount of the capital (or the wealth), with disturbing repercussions for the rest of us.

For the next six days, I'll be publishing a link per day to web material related to Thomas Piketty and Capital in the Twenty-first Century. Piketty generally has been praised for the sheer depth of his research, and criticized for failing to offer a solution to the problem apart from a global tax on wealth, which strikes most observers as unlikely.

Pitchforks, anyone? We begin with a cheat sheet.

Thomas Piketty’s “Capital in the Twenty-first Century” explained, by Mike Llewellyn (Ideas.Ted)

A Piketty guide for lifelong learners.

When Thomas Piketty’s “Capital in the Twenty-first Century” was published, it was something of a sensation. That’s no small feat for a chart-heavy doorstop on “the dismal science” of economics.

A fair portion of the book’s notoriety was due to its subject matter: wealth distribution, an intensely political topic if ever there was one.

What makes this French economist’s conclusions worth global notice? The short answer is that Piketty and his research team amassed a mountain of data, much of it going back centuries, suggesting that the concentration of wealth in ever-fewer hands is not an anomaly or a recent development. Check out the infographic (above) for a longer explanation:

As the data visualization above suggests, this is simply how capitalism works. Without a significant force to counterbalance rising wealth inequality, the research indicates, a capitalist economy will drift predictably toward oligarchy.

"Instead of growth at all costs, a new economic model allows us to thrive while saving the planet."

We've "been there," and only recently.

What do you know? Chance the gardener was right, after all.

Now, to continue the doughnut riff:

Finally, a breakthrough alternative to growth economics – the doughnut, by George Monbiot (The Guardian)

So what are we going to do about it? This is the only question worth asking. But the answers appear elusive. Faced with a multifaceted crisis – the capture of governments by billionaires and their lobbyists, extreme inequality, the rise of demagogues, above all the collapse of the living world – those to whom we look for leadership appear stunned, voiceless, clueless. Even if they had the right courage to act, they have no idea what to do.

The most they tend to offer is more economic growth: the fairy dust supposed to make all the bad stuff disappear. Never mind that it drives ecological destruction; that it has failed to relieve structural unemployment or soaring inequality; that, in some recent years, almost all the increment in incomes has been harvested by the top 1%. As values, principles and moral purpose are lost, the promise of growth is all that’s left ...

What do you know? Chance the gardener was right, after all.

Growth for the sake of growth is the ideology of the cancer cell.
-- author unknown

The book is Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist, by Kate Raworth, and if this essay is any indication, I need to read it soon.

On second thought, it just might put a few academicians and One Southern Indiana functionaries out of work.

As such, it needs to be read even faster.

Old economics is based on false ‘laws of physics’ – new economics can save us, by Kate Raworth (The Guardian)

It is time to ditch the belief that economies obey rigid mechanical rules, which has widened inequality and polluted our planet. Economics is evolving

... So if the economy is not best thought of as a mechanism that returns to equilibrium and follows fixed laws of motion, how should we think of it? Like the living world: it’s complex, dynamic and ever-evolving. And for economists, that means it’s time for a metaphorical career change: from engineer to gardener. Let’s take off the hard hat and give up on reaching for the economy’s control levers because they simply don’t exist. Instead, put on some gardening gloves, pick up a pair of secateurs, and start to steward the economic garden. And if you think that sounds laissez faire, then you’ve never done a hard day’s work in the garden: it calls for getting stuck in, digging, pruning, weeding and watering the plants as they grow and mature.

How can economic gardeners help to create a thriving economy, one that is inclusive and sustainable and will help to achieve the sustainable development goals? By following two core principles: make it regenerative and distributive by design.