When revisiting my old post "Societal Slack and Progressive Taxation" I decided to enlarge upon the matter, specifically considering how corporations have paid steadily less in tax since the end of World War II (from 4-5 percent of GDP, down to 1-2 percent in recent years).
In this post I turn to the distribution of the personal income tax burden.
According to recent data from the Tax Foundation, the top 0.1 percent of taxpayers took home 9.52 percent of all Adjusted Gross Income back in 2016. Some 141,000 people receiving some $2.1 million a year or more, they collectively got about $970 billion, and paid some $260 billion of that in tax.
As is often noted, the rate in the top tax bracket is far lower than it used to be. In 2016 it was 39.6 percent. By contrast, between the end of World War II and the early 1960s it was 91 percent, levied on, if one adjusts for inflation, roughly that level of income.
What would the '50s-era tax rate on the earnings of the top 0.1 percent above that $2.1 million level (such as was the case in 1950) raise? One can take the $970 billion figure and deduct from it the aforementioned income (the first $2.1 million made by that 141,000 persons). They would wind up with about $675 billion. Ninety-one percent of that sum would amount to over $610 billion--over twice that strata's entire tax contribution in 2016.
And of course, one could extend this pattern down through the rest of the 1 percent (1.4 million taxpayers with roughly $500,000 in income). Simply taxing everything between a half million dollars and $2.1 million at the 73 percent rate prevailing in 1950, one would wind up with another $460 billion--over $1 trillion in income raised on earnings above the half million dollar a year level, in contrast with the $500 billion actually paid by the top 1 percent. As this implies the practice does run into diminishing returns fairly quickly, but extending the approach down through the rest of the top 10 percent (with anything above $200,000 taxed at 53 percent, anything above $140,000 at 48 percent), would raise the tax collected on marginal income above $140,000 a year alone into the $1.7 trillion range, roughly $700 billion more than what the top 10 percent actually paid in 2016.
Moreover, there are respects in which these figures can be considered conservative. One is that the above, rough calculation did not take into account the intricacy of the bracket structure, which would have captured more wealth from each strata of taxpayer. (Income between $500,000 and $2.1 million would not all have been taxed at the 73 percent rate but, as income rose from the low to the high end of this range, been subject to seven progressively higher rates, with 1950 seeing anything above $1.65 million or so taxed at 90 percent.) Another is the way in which inflation and "bracket creep" translated to more people paying at higher rates (so that by 1963 anything above that $1.65 million, roughly speaking, was now subject to the maximum rate, and similar creep evident down the line). Still another is the fact that higher rates extended down somewhat below that most affluent tenth. (In 1963 anything above $14,000--$117,000 in today's terms--was taxed at 41 percent, higher than the maximum rate today.) The result is that a 1950s-like tax rate structure could raise still more than suggested above. Perhaps another trillion dollars a year would not be out of the question.
However, there is also another side to the issue, namely that nominal tax rates are one thing, and effective tax rates another. The exemptions built into the system, the possibilities for legal avoidance, the recourse to illegal evasion, doubtless translated to a lower effective rate, though by just how much is a highly contentious matter. Writers abiding by the libertarian "conventional wisdom" of the economics field are quick to insist, and vehement in insisting, that the '50s did not see the rich actually paying the extravagant rates the nominal figures imply.
The idea that effective tax levels are not really much lower than they were before strikes me as implausible in light of the sharp cuts in rates for which conservatives fought so long and hard; by the reality of the growing share of income (more on which below) enjoyed by the most affluent, which is very plausibly a function of their being more lightly taxed; and changing conduct on the part of corporations whose stockholders, inhibited from taking out as much in dividends as they theoretically could by high personal income tax rates, shifted to treating corporations like ATMs after the tax cuts (payout rates 50 percent in the '60s, dipping in the '70s and exploding to a whopping 94 percent by the turn of the century).
Moreover, there is a point that those dismissive of the significance of the higher rates overlook--namely that in the '50s the rich were less rich, absolutely and relatively, and therefore relatively less of their income, and everyone's income, subject to higher marginal rates. In 1950 scarcely 20,000 of 55 million taxpayers, 0.036 percent of the population, reported making $100,000 or more, qualifying for those top three brackets. Where the larger picture is concerned the share of income enjoyed by the most affluent 1 percent ran at 8-9 percent of the total during the decade, the top 10 percent about 30-35 percent of the total figure.
By contrast, hundreds of thousands now report making twice the equivalent of $100,000 in 1950s-era dollars (about $1 million), while that top 1 percent now commands 19 percent of the nation's income, and the top 10 percent, 45-50 percent of the total. Had the richest been so rich then, and the income distribution as skewed then as it is now, then the '50s-era system would have meant much more income subject to the highest rates. All others things being equal, the effective rates would have reflected this--and it can only be expected that, were such a rate structure in place today, we would also see that.
Still, as the large sums discussed here suggest, the additional revenue that could be generated by even an effective rate considerably below the nominal rates, capturing only part of the income discussed above, would be far from trivial. (Were new higher, nominal, rates to raise the effective rate on just the richest 0.1 percent by half from the current 27 percent to 40 percent as a whole, which may not be unprecedented--all the caveats about changing methods for calculating AGI over time notwithstanding--this would still translate to an extra $130 billion a year, $1.3 trillion in ten years.)
Additionally, there are grounds for thinking that the effective rates of the 1950s do not necessarily represent some theoretical maximum. Per capita income is three to four times what it was in the 1950s, and the reality is that much of our economic trouble has come not from there being to little capital available, but too few profitable opportunities for its investment. (The ultimate cause of slow growth and asset bubbles, it is why financial institutions were so willing to buy crummy mortgage-based securities back in the early 2000s, with the horrid implications with which we are all still coping.) There is also the reality that the data on household income, as Thomas Piketty argued, tend to underestimate rather than overestimate how much the wealthiest have, indicating hidden potentials, the proportions of which are hinted at in the multi-trillion dollar "black hole" in the world's balance sheets.
Consequently, the bottom line is that if it had to be done the obstacle to raising substantially more revenue by way of the income tax (even just raising it on the narrow stratum of the most affluent taxpayers) would not be the means to pay, but the political obstacles to changing tax rates.
1. IRS data indicates that in 1980 0.2 percent of taxpayers were paying 40 percent or more. Below that level another 7.5 percent paid between 30-40 percent.
Thursday, April 18, 2019
Societal Slack and Progressive Taxation: A Second Look (Part I-Corporate Income Tax)
Like my old piece on "Societal Complexity and Diminishing Returns in Security" it seems that a post I wrote a decade ago on "Societal Slack and Progressive Taxation" is getting some new attention.
The essentials are simple. The piece notes that while the highest earners' share of tax has risen markedly in recent decades, it has not risen so markedly as their share of income, so that their burden is lighter relative to their means, not heavier. At the same time corporate income tax fell as a proportion of Gross Domestic Product and Federal revenue. By contrast, the share of payroll taxes held steady in the 30-40 percent range from the 1970s forward. All this meant that the rich paid less, the poor more, in a more regressive system.
Checking the numbers again recently--in this case, those in the Historical Tables of the latest edition of the Budget of the U.S. Government (Table 2-2)--suggests that for the past decade the situation did not change very much until the current administration, though clearly this is happening with corporate income tax. After 1945 the trend in its share of Federal revenue was downward, from 35 percent that year to around 15 percent in the 1970s, then generally the 8-12 percent range after Reagan, sometimes dipping a bit below, sometimes rising a bit above. In 2018, following Trump's tax cut (knocking the corporate income tax rate from 35 to 21 percent, while the loopholes remain), it hit a historic new low--a mere 6.1 percent of the total.
As a share of GDP (see Table 2-3) corporate income tax has also fallen. Generally in the 4-5 percent range in the 1950s, and the 3-4 percent range in the 1960s, 2-3 percent in the 1970s, it has generally been 2 percent or less since Reagan, save in periods of exceptional profits (the Clinton-era boom, the heady years just before the crash of 2008). The Trump tax cut similarly knocked corporate income tax down to a mere 1 percent of GDP in 2018, a level seen in only one previous year--2009, after the crash.
The decline in the amount of corporate income tax paid has generally gone alongside rising after-tax corporate profits. According to Federal Reserve data, after-tax corporate profits generally ran in the 5-7 percent of GDP range in the 1950s, the 6-7 percent range in the 1960s, and 7-8 percent in the 1970s (despite a sharp dip amid the 1974-1975 recession). They collapsed in the '80s, bottoming out in 1986 at around 3.7 percent of Gross Domestic Product before beginning a fitful upward climb, approaching 7 percent again in the '90s, and then despite ups and downs, in the early 2000s ascending toward heights unscaled since the Korean War era. In 2004 profits hit 8 percent of GDP, the next year 10 percent, roughly the level at which they have stayed ever since.
It is worth noting that in the much higher-tax 1950s private investment levels were roughly equal to what we have now (in the 15-18 percent of GDP range), and arguably the investment directed more fully toward substantive economic activity.
This suggests that corporations could pay much more than they have generally been doing, without any harm being done to investment. Moreover, were they paying that higher but clearly quite tolerable '50s-era proportion of tax, that would be 2-4 percent of GDP more than they have generally been doing to date--an additional $400-800 billion a year. And of course, the figure was still higher in the war years--more like 7 percent of GDP in 1944-1945 at the height of the war effort (another $400 billion, bumping us up to the $1 trillion a year range).
I suspect it might also be easier to administer such a tax on a handful of large corporations than to raise an equivalent sum from individual households, though one should also remember that this would not at all rule out a higher income tax rate--those years when corporate tax rates were so high in the 1950s also years in which the top income tax bracket was 91 percent.
You can expect me to say something of that matter in another post, to appear shortly.
The essentials are simple. The piece notes that while the highest earners' share of tax has risen markedly in recent decades, it has not risen so markedly as their share of income, so that their burden is lighter relative to their means, not heavier. At the same time corporate income tax fell as a proportion of Gross Domestic Product and Federal revenue. By contrast, the share of payroll taxes held steady in the 30-40 percent range from the 1970s forward. All this meant that the rich paid less, the poor more, in a more regressive system.
Checking the numbers again recently--in this case, those in the Historical Tables of the latest edition of the Budget of the U.S. Government (Table 2-2)--suggests that for the past decade the situation did not change very much until the current administration, though clearly this is happening with corporate income tax. After 1945 the trend in its share of Federal revenue was downward, from 35 percent that year to around 15 percent in the 1970s, then generally the 8-12 percent range after Reagan, sometimes dipping a bit below, sometimes rising a bit above. In 2018, following Trump's tax cut (knocking the corporate income tax rate from 35 to 21 percent, while the loopholes remain), it hit a historic new low--a mere 6.1 percent of the total.
As a share of GDP (see Table 2-3) corporate income tax has also fallen. Generally in the 4-5 percent range in the 1950s, and the 3-4 percent range in the 1960s, 2-3 percent in the 1970s, it has generally been 2 percent or less since Reagan, save in periods of exceptional profits (the Clinton-era boom, the heady years just before the crash of 2008). The Trump tax cut similarly knocked corporate income tax down to a mere 1 percent of GDP in 2018, a level seen in only one previous year--2009, after the crash.
The decline in the amount of corporate income tax paid has generally gone alongside rising after-tax corporate profits. According to Federal Reserve data, after-tax corporate profits generally ran in the 5-7 percent of GDP range in the 1950s, the 6-7 percent range in the 1960s, and 7-8 percent in the 1970s (despite a sharp dip amid the 1974-1975 recession). They collapsed in the '80s, bottoming out in 1986 at around 3.7 percent of Gross Domestic Product before beginning a fitful upward climb, approaching 7 percent again in the '90s, and then despite ups and downs, in the early 2000s ascending toward heights unscaled since the Korean War era. In 2004 profits hit 8 percent of GDP, the next year 10 percent, roughly the level at which they have stayed ever since.
It is worth noting that in the much higher-tax 1950s private investment levels were roughly equal to what we have now (in the 15-18 percent of GDP range), and arguably the investment directed more fully toward substantive economic activity.
This suggests that corporations could pay much more than they have generally been doing, without any harm being done to investment. Moreover, were they paying that higher but clearly quite tolerable '50s-era proportion of tax, that would be 2-4 percent of GDP more than they have generally been doing to date--an additional $400-800 billion a year. And of course, the figure was still higher in the war years--more like 7 percent of GDP in 1944-1945 at the height of the war effort (another $400 billion, bumping us up to the $1 trillion a year range).
I suspect it might also be easier to administer such a tax on a handful of large corporations than to raise an equivalent sum from individual households, though one should also remember that this would not at all rule out a higher income tax rate--those years when corporate tax rates were so high in the 1950s also years in which the top income tax bracket was 91 percent.
You can expect me to say something of that matter in another post, to appear shortly.
Sunday, April 14, 2019
Review: Imperial Germany and the Industrial Revolution, by Thorstein Veblen
C. Wright Mills has celebrated Thorstein Veblen as "The best critic of America that America has produced," but Veblen did at times turn his attention to the life of other nations, notably Germany, to which he applied the considerably body of theory he had amassed (most pointedly in his Theory of Business Enterprise). He read Germany as something of a paradox--in respects the most modern of states (as in its industry), in others among the most backward of the major powers (in its dynastic, war-like character). How could the two characteristics be present in the same country? Veblen asked.
In trying to answer that question Veblen relied on a comparison of Germany with that first scene of the Industrial Revolution and, in conventional thinking, counter-example to Germany, un-Germany, England, comparing the two countries. (Indeed, rather than "Imperial Germany and the Industrial Revolution" he would have done well to title the book "England, Germany and the Industrial Revolution.") He began that comparison by probing deep into the historic past, devoting his first two chapters to the racial heritage and early history of the "North Sea-Baltic peoples" from whom both England and Germany derive their ancestry--essentially, to rule out the idea that this was a matter of race (he debunks the idea of race purity, and in any event, shows that with regard to heritage Englishman and German are pretty much the same), or of very early cultural antecedents, before turning to the real heart of the matter, more recent, and more economic and political, history.
Veblen argues that in England the Medieval heritage was less strongly rooted than elsewhere in Europe, and from the sixteenth century began to wither with the increasing mercantile-industrial turn of English life, a process enabled by England's insular position sheltering it from the wars raging across the continent, and the country's combination of peacefulness and backwardness relative to other parts of the continent (England less advanced than, for example, the Netherlands, while its stability made it attractive to skilled continental emigrants). Altogether these factors (and only these) created a culture that was more materialist (in the philosophical sense of the term), empirical, "matter of fact," individualist and modern-liberal, a trend accelerated and deepened by the rise of a machine industry in that part of the world.
By contrast Prussia was essentially the product of the Teutonic Knights' secularization in comparatively underdeveloped and turbulent northeastern Europe. The Medieval heritage, and especially the predatory ethos of that earlier era, with its stress on war-like values, hierarchy and personal subordination (exalted as "duty" and a cult of the State), was stronger to begin with, and endured longer--and with them the turn of thought in the opposite direction from England's, away from the materialistic and matter of fact toward the "transcendental," the "ideal," the "Romantic." Subsequently, Prussia's unification of Germany transmitted this ethos to the rest of the German Empire (in particular through its education system and compulsory military service, the latter in his analysis a powerful inculcator of subordination).
Still, if Germany's ethos was more Medieval than "modern," the country's leaders saw the necessity of development, and the country was far from unequal to the task. As Veblen explains it Germany's resource situation was mediocre but not unworkable, especially given the advantage it had in a large supply of cheap but capable labor with a scarcity of alternative outlets for its energies. (Where the well-born, well-educated Englishman might become a leisured "gentleman," or perhaps go to the City, and in either case exist as simply a charge on his nation's economy, in Germany he was apt to become an engineer instead and contribute to its industrial development.) Germany also had the advantages of backwardness--the fact that where in Britain industrialization was, due to its being first, ad hoc and relatively impure, mixed up with much pre-industrial practice that held it back; and at the same time was also suffering from its own maturity (like a capital that became obsolescent; rising, wasteful consumption; the inefficiencies entailed by a hyperdeveloped financial sector); Germany was starting from scratch, quite deliberately, and so could build its plant along the most thoroughly industry-oriented lines, minus unnecessary encumbrances.1
However, Veblen did not see this arrangement as somehow enduring forever. As Britain's economy had matured, so was Germany's already doing. As he noted, the costs of labor and the fixed charges of capitalization rose; while as the country became more thoroughly industrialized the share of capital investment inevitably declined, to the cost of Germany's hugely important capital goods sector. At the same time Germany's industrial output outstripped both the growth of foreign demand, and the locally available natural resources, forcing it to look abroad for more expensive foreign supplies to sustain that production. Meanwhile, Germany's plant became obsolescent in its turn as its equipment appreciated and its own growth and development meant that its earlier arrangements were becoming suboptimal from the standpoint of efficiency and growth.
Veblen also argued that as Germany developed industrial life would erode its Medievalism, but that this had been slowed by the country's intensive militarization, and so as of the early twentieth century the process had not gone so far as it might have done. Indeed, he holds that basically World War I was a matter of a Medieval dynastic state equipped with extraordinarily modern industry and military forces threatening the peace of the world.
With the hindsight of a century it seems to me that Veblen's analysis definitely has its shortcomings. The most obviously dated feature is the long discussion prompted by the racialist pseudoscience of his day, which will try many a contemporary reader's patience. However, there were other ways in which his discussion struck me as less convincing than it might have been. Certainly he underrates the natural assets that enabled Germany to industrialize so speedily and robustly--its coal and iron riches, water transport and the like less ample than Britain's, but still rather more impressive than those of any other continental state, while the country occupied a unique position in the heart of Europe (between east and west, north and south) at a moment when Europe was fast becoming the center of world economic life. (You can see my case here.) It struck me, too, that he overrated the modernity of the German economy, especially in comparison with the United States.2 (As Adam Tooze's Wages of Destruction points out, for all Germany's very real cutting-edge achievements, the Fordism that would change everything was not born there, but across the Atlantic.) Finally Veblen goes too far in chalking up Germany's aggressive behavior to irrational dynastic aggrandizement when much else was at fault--not least, economic imperialism driven by stresses that Veblen himself discusses so ably, and which Fritz Fischer was, a half century later, to provide such robust coverage of in his classic diplomatic history, Germany's Aims in the First World War.
Still, as is often the case when great thinkers ask large questions and provide answers that do not fully satisfy us, Veblen managed to produce a great many compensating insights--not least into that question of the contrasts between German and English culture and history, and the economic stresses that helped put Germany on the path to war. Moreover, the principal reason for the book's still enjoying status as a classic, its pioneering treatment of the matter of the "advantages of backwardness"--those ways in which less-developed countries manage to achieve faster rates of industrial expansion and economic growth, or develop more thoroughly their industrial bases, than more developed countries--is lucid and robust, justly essential reading for students of the subject. And in the end what was worthwhile greatly outweighed what has lost its interest.
1. German industrialists, as Veblen noted, did not enter business by way of "the training school of a country town based on a retail business in speculative real estate and political jobbery managed under the rule of 'prehension, division and silence' . . . [but] under the selective test for fitness in the aggressive conduct of industrial enterprise." Nor were they "committed to antiquated sites and routes for . . . industrial plant; the men who exercised the discretion were free to choose, with an eye single to the mechanical expediency of locations for the pursuit of industry." German industrialists "were also free to take over the processes of the new industry at their best and highest efficiency, rather than content themselves with compromises between the best equipment known and what used to be the best a few years or a few decades ago," while finance was not yet in a position to divert them from "the production of merchantable goods and services."
2. Veblen, identifying American business with his reading of the country town ethos, seemed much more oriented to what he called "business" (the pursuit of "net gain in dollars," and above all speculative "pecuniary strategy" founded on "patiently wait[ing] on the chance of getting getting something for nothing") than "industry" (the technical problem of enlarging output). Indeed, he specifically characterized as averse to innovation with "untried, unstandardised industrial projects and expedients . . . anathema" to such a degree that it "rejects such candidates as are endowed with technological insight or . . . aggressive curiosity in matters of industrial innovation." For a fuller discussion of his thought on these matters, see his Theory of Business Enterprise and his later Absentee Ownership.
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In trying to answer that question Veblen relied on a comparison of Germany with that first scene of the Industrial Revolution and, in conventional thinking, counter-example to Germany, un-Germany, England, comparing the two countries. (Indeed, rather than "Imperial Germany and the Industrial Revolution" he would have done well to title the book "England, Germany and the Industrial Revolution.") He began that comparison by probing deep into the historic past, devoting his first two chapters to the racial heritage and early history of the "North Sea-Baltic peoples" from whom both England and Germany derive their ancestry--essentially, to rule out the idea that this was a matter of race (he debunks the idea of race purity, and in any event, shows that with regard to heritage Englishman and German are pretty much the same), or of very early cultural antecedents, before turning to the real heart of the matter, more recent, and more economic and political, history.
Veblen argues that in England the Medieval heritage was less strongly rooted than elsewhere in Europe, and from the sixteenth century began to wither with the increasing mercantile-industrial turn of English life, a process enabled by England's insular position sheltering it from the wars raging across the continent, and the country's combination of peacefulness and backwardness relative to other parts of the continent (England less advanced than, for example, the Netherlands, while its stability made it attractive to skilled continental emigrants). Altogether these factors (and only these) created a culture that was more materialist (in the philosophical sense of the term), empirical, "matter of fact," individualist and modern-liberal, a trend accelerated and deepened by the rise of a machine industry in that part of the world.
By contrast Prussia was essentially the product of the Teutonic Knights' secularization in comparatively underdeveloped and turbulent northeastern Europe. The Medieval heritage, and especially the predatory ethos of that earlier era, with its stress on war-like values, hierarchy and personal subordination (exalted as "duty" and a cult of the State), was stronger to begin with, and endured longer--and with them the turn of thought in the opposite direction from England's, away from the materialistic and matter of fact toward the "transcendental," the "ideal," the "Romantic." Subsequently, Prussia's unification of Germany transmitted this ethos to the rest of the German Empire (in particular through its education system and compulsory military service, the latter in his analysis a powerful inculcator of subordination).
Still, if Germany's ethos was more Medieval than "modern," the country's leaders saw the necessity of development, and the country was far from unequal to the task. As Veblen explains it Germany's resource situation was mediocre but not unworkable, especially given the advantage it had in a large supply of cheap but capable labor with a scarcity of alternative outlets for its energies. (Where the well-born, well-educated Englishman might become a leisured "gentleman," or perhaps go to the City, and in either case exist as simply a charge on his nation's economy, in Germany he was apt to become an engineer instead and contribute to its industrial development.) Germany also had the advantages of backwardness--the fact that where in Britain industrialization was, due to its being first, ad hoc and relatively impure, mixed up with much pre-industrial practice that held it back; and at the same time was also suffering from its own maturity (like a capital that became obsolescent; rising, wasteful consumption; the inefficiencies entailed by a hyperdeveloped financial sector); Germany was starting from scratch, quite deliberately, and so could build its plant along the most thoroughly industry-oriented lines, minus unnecessary encumbrances.1
However, Veblen did not see this arrangement as somehow enduring forever. As Britain's economy had matured, so was Germany's already doing. As he noted, the costs of labor and the fixed charges of capitalization rose; while as the country became more thoroughly industrialized the share of capital investment inevitably declined, to the cost of Germany's hugely important capital goods sector. At the same time Germany's industrial output outstripped both the growth of foreign demand, and the locally available natural resources, forcing it to look abroad for more expensive foreign supplies to sustain that production. Meanwhile, Germany's plant became obsolescent in its turn as its equipment appreciated and its own growth and development meant that its earlier arrangements were becoming suboptimal from the standpoint of efficiency and growth.
Veblen also argued that as Germany developed industrial life would erode its Medievalism, but that this had been slowed by the country's intensive militarization, and so as of the early twentieth century the process had not gone so far as it might have done. Indeed, he holds that basically World War I was a matter of a Medieval dynastic state equipped with extraordinarily modern industry and military forces threatening the peace of the world.
With the hindsight of a century it seems to me that Veblen's analysis definitely has its shortcomings. The most obviously dated feature is the long discussion prompted by the racialist pseudoscience of his day, which will try many a contemporary reader's patience. However, there were other ways in which his discussion struck me as less convincing than it might have been. Certainly he underrates the natural assets that enabled Germany to industrialize so speedily and robustly--its coal and iron riches, water transport and the like less ample than Britain's, but still rather more impressive than those of any other continental state, while the country occupied a unique position in the heart of Europe (between east and west, north and south) at a moment when Europe was fast becoming the center of world economic life. (You can see my case here.) It struck me, too, that he overrated the modernity of the German economy, especially in comparison with the United States.2 (As Adam Tooze's Wages of Destruction points out, for all Germany's very real cutting-edge achievements, the Fordism that would change everything was not born there, but across the Atlantic.) Finally Veblen goes too far in chalking up Germany's aggressive behavior to irrational dynastic aggrandizement when much else was at fault--not least, economic imperialism driven by stresses that Veblen himself discusses so ably, and which Fritz Fischer was, a half century later, to provide such robust coverage of in his classic diplomatic history, Germany's Aims in the First World War.
Still, as is often the case when great thinkers ask large questions and provide answers that do not fully satisfy us, Veblen managed to produce a great many compensating insights--not least into that question of the contrasts between German and English culture and history, and the economic stresses that helped put Germany on the path to war. Moreover, the principal reason for the book's still enjoying status as a classic, its pioneering treatment of the matter of the "advantages of backwardness"--those ways in which less-developed countries manage to achieve faster rates of industrial expansion and economic growth, or develop more thoroughly their industrial bases, than more developed countries--is lucid and robust, justly essential reading for students of the subject. And in the end what was worthwhile greatly outweighed what has lost its interest.
1. German industrialists, as Veblen noted, did not enter business by way of "the training school of a country town based on a retail business in speculative real estate and political jobbery managed under the rule of 'prehension, division and silence' . . . [but] under the selective test for fitness in the aggressive conduct of industrial enterprise." Nor were they "committed to antiquated sites and routes for . . . industrial plant; the men who exercised the discretion were free to choose, with an eye single to the mechanical expediency of locations for the pursuit of industry." German industrialists "were also free to take over the processes of the new industry at their best and highest efficiency, rather than content themselves with compromises between the best equipment known and what used to be the best a few years or a few decades ago," while finance was not yet in a position to divert them from "the production of merchantable goods and services."
2. Veblen, identifying American business with his reading of the country town ethos, seemed much more oriented to what he called "business" (the pursuit of "net gain in dollars," and above all speculative "pecuniary strategy" founded on "patiently wait[ing] on the chance of getting getting something for nothing") than "industry" (the technical problem of enlarging output). Indeed, he specifically characterized as averse to innovation with "untried, unstandardised industrial projects and expedients . . . anathema" to such a degree that it "rejects such candidates as are endowed with technological insight or . . . aggressive curiosity in matters of industrial innovation." For a fuller discussion of his thought on these matters, see his Theory of Business Enterprise and his later Absentee Ownership.
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What is Complexity?
We often hear the word complexity, now more than ever because of the way in which our lives are bound up with systems of extremely high complexity--social, technological, ecological, and indeed all three, as an issue such as climate change reminds us. However, if asked people usually have a hard time explaining what "complexity" means--partly because complexity and simplicity are properties of systems, which they find they have to explain also.
Systems are sets of parts or things that work together. As for complexity, here is what I had to say about the matter in my article "Societal Complexity and Diminishing Returns in Security."
My Posts on a Green New Deal
4/12/19
My Posts on Neoliberal Environmentalism
4/12/19
New Readers for my International Security Piece, Fifteen Years On?
3/31/19
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Systems are sets of parts or things that work together. As for complexity, here is what I had to say about the matter in my article "Societal Complexity and Diminishing Returns in Security."
According to one definition, complexity refers to "asymmetric relationships that reflect organization and restraint" between the parts of a system. As such, the characteristic features of complex systems are their composition from a large number of components with a dense web of connections between them; a high degree of interdependence within them; an openness to outside environments, rather than their being self-contained; "synergy," meaning that the whole is more than the sum of its parts; and nonlinear functioning, so that changes in these systems have effects disproportionate to their size, either larger or smaller. Such nonlinearity and synergy come with an exponentially increased range of possible interactions, including unplanned interactions, making an incomplete understanding of at least some processes also an aspect of complex systems.
My Posts on a Green New Deal
4/12/19
My Posts on Neoliberal Environmentalism
4/12/19
New Readers for my International Security Piece, Fifteen Years On?
3/31/19
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Saturday, April 13, 2019
The Passing of the European Dream
Reading Adam Tooze's Crashed, which treats the 2008 crisis as the trans-Atlantic (rather than American) phenomenon it most assuredly was, I found myself thinking again of that "European Dream" long since ended. Back when social critics thought that perhaps Europe would present a more egalitarian, more sustainable socioeconomic model than the United States, no astute observer imagined, for example, that the continent's power elite has become confirmed socialists, or even social democrats. One took them for conservative bourgeois capitalists like any others, who would always rather have more than less, and like nothing better than a tax-free, union-free, unregulated business environment.
Yet, there was the hope that in a less atomized culture which had a longer and more turbulent history that included substantive experience of challenges from below, a more long-term, enlightened version of self-interest, somewhat less simple-minded "libertarianism," a touch more paternalism, would leave them inhibited about pushing too far; and that a more conscious, cohesive and organized labor movement and left, behind a more elaborately developed state, would similarly moderate their expectations.
Anyone who hoped that has been disappointed, Europe's elite having proven as myopic, greedy and ideological; as stupid and rapacious and vicious; as their counterparts anywhere else. Thus did they create their own banking crisis and tie themselves into the American crisis to boot; thus did they strive to impose yet more of the neoliberalism that had already proven such a disaster in the aftermath of the calamities they wrought for themselves and the world. As might be guessed given that all this had come to pass, Europe's working people also proved far less successful in standing up to those elites than their sympathizers hoped. The CEOs and oligarchs may not have remade their continent's institutions and laws and social understandings in the image of the reddest of American red states, but they had long had the momentum on their side before the crisis, and only continued to make headway after it, as the social democratic parties proved complicit, and right-wing populists and other fraudsters the principal beneficiaries of the electoral shakeups rather than new parties of the left or center.
Indeed, remembering my comment on the death of the European dream back in 2012, I remark my mention of Neo-Nazis in the streets of Greece, with the tolerance of the police. This year Neo-Nazis went on the rampage not in Europe's southeastern fringe, but in its supposedly chastened center, Germany, and not merely with the tolerance of the police, but the Interior Minister's publicly expressed sympathy--Horst Seehofer disgustingly declaring that he would have been with the "protestors" were it not for his position, while in mealy-mouthed fashion downplaying their politics. In that I am reminded yet again of how fast and how far the situation has deteriorated, the end of the European Dream hinting at a European Nightmare that might not be so different from previous European Nightmares in which an American speculative bust and global economic downturn empowered fascists across the continent.
Yet, there was the hope that in a less atomized culture which had a longer and more turbulent history that included substantive experience of challenges from below, a more long-term, enlightened version of self-interest, somewhat less simple-minded "libertarianism," a touch more paternalism, would leave them inhibited about pushing too far; and that a more conscious, cohesive and organized labor movement and left, behind a more elaborately developed state, would similarly moderate their expectations.
Anyone who hoped that has been disappointed, Europe's elite having proven as myopic, greedy and ideological; as stupid and rapacious and vicious; as their counterparts anywhere else. Thus did they create their own banking crisis and tie themselves into the American crisis to boot; thus did they strive to impose yet more of the neoliberalism that had already proven such a disaster in the aftermath of the calamities they wrought for themselves and the world. As might be guessed given that all this had come to pass, Europe's working people also proved far less successful in standing up to those elites than their sympathizers hoped. The CEOs and oligarchs may not have remade their continent's institutions and laws and social understandings in the image of the reddest of American red states, but they had long had the momentum on their side before the crisis, and only continued to make headway after it, as the social democratic parties proved complicit, and right-wing populists and other fraudsters the principal beneficiaries of the electoral shakeups rather than new parties of the left or center.
Indeed, remembering my comment on the death of the European dream back in 2012, I remark my mention of Neo-Nazis in the streets of Greece, with the tolerance of the police. This year Neo-Nazis went on the rampage not in Europe's southeastern fringe, but in its supposedly chastened center, Germany, and not merely with the tolerance of the police, but the Interior Minister's publicly expressed sympathy--Horst Seehofer disgustingly declaring that he would have been with the "protestors" were it not for his position, while in mealy-mouthed fashion downplaying their politics. In that I am reminded yet again of how fast and how far the situation has deteriorated, the end of the European Dream hinting at a European Nightmare that might not be so different from previous European Nightmares in which an American speculative bust and global economic downturn empowered fascists across the continent.
Why I Do Not Support Degrowth: Postscript
As I made clear in a recent post, I am not in favor of "degrowth." The benefits of modernity have been vast, the world remains a place where most people need more rather than less in the way of material comfort, and if anything, we will need more wealth and technology, not less, in order to combat and reverse climate change, along with our other problems, environmental and otherwise.
None of this, however, is to deny that there is much that we would be better off without. I am well aware that our diets are not so healthy for us (let alone the planet) as they might be. I am not convinced that personal transport has no part to play in our future, but there is much that is wrong with our car culture, our consumer culture, our advertising culture.
However, I find myself remembering Uncle Ben's famous words to Peter Parker: "With great power, comes great responsibility."
That piece of wisdom is, I think, indisputable--but society lives by the opposite principle, each and every day, in each and every way. Those who have all the power declaim responsibility for anything; while those who have no power are held responsible for everything. White collar criminality on a global, genuinely supervillain scale is shrugged off, while a bank teller who cannot account for a five-dollar bill finds her low-paying job at risk, and very possibly her life destroyed.
Thus does it go with neoliberal environmentalists. They condemn the environmental impact of animal product consumption--rather than the producers of these goods, who have taken so little interest in alleviating or eliminating that impact (let alone thinking of the stressful lives that drive them to stress eat so much of them, generally chosen for them by those who set the terms of work and the mechanisms of support for the disadvantaged, people far richer and more powerful than they). They condemn motorists for driving gas-guzzling cars--rather than condemning the business interests that fight against sane urban planning and the provision of walkable cities and decent public transport, while on top of that, holding back alternatives to the internal combustion engine and insisting on selling more and more vehicle per consumer. They condemn consumers for shopping so much--rather than condemning the corporations that opt for built-in obsolescence and throwaway goods rather than their refusal to produce durable, low-maintenance goods that non-specialists can cost-effectively repair themselves. Condemn consumers for responding to pointless product differentiation, advertising and the innumerable pressures business places on them to buy new goods when the old ones are still working--rather than the businesses that engage in those practices.
At every point, they condemn those who had the least say in the matter for their choices--while letting those who had far, far more say off the hook. I have discussed where this comes from in the past enough times and in enough ways to feel no need to enlarge on it here, but I do not think the essential point can be overstated enough. What we need is not to deprive the millions and billions of comfort and choice, but rather to give them real choices--the choice of more leisure rather than more things, the choice of a walk or transit instead of a car, the choice to not keep buying throwaway items--while taking sustainability into account when determining the production methods by how which industry meet their needs, as they and not an elite telling them "You don't need that!" in the tone haves have always used with have-nots, determine them.
None of this, however, is to deny that there is much that we would be better off without. I am well aware that our diets are not so healthy for us (let alone the planet) as they might be. I am not convinced that personal transport has no part to play in our future, but there is much that is wrong with our car culture, our consumer culture, our advertising culture.
However, I find myself remembering Uncle Ben's famous words to Peter Parker: "With great power, comes great responsibility."
That piece of wisdom is, I think, indisputable--but society lives by the opposite principle, each and every day, in each and every way. Those who have all the power declaim responsibility for anything; while those who have no power are held responsible for everything. White collar criminality on a global, genuinely supervillain scale is shrugged off, while a bank teller who cannot account for a five-dollar bill finds her low-paying job at risk, and very possibly her life destroyed.
Thus does it go with neoliberal environmentalists. They condemn the environmental impact of animal product consumption--rather than the producers of these goods, who have taken so little interest in alleviating or eliminating that impact (let alone thinking of the stressful lives that drive them to stress eat so much of them, generally chosen for them by those who set the terms of work and the mechanisms of support for the disadvantaged, people far richer and more powerful than they). They condemn motorists for driving gas-guzzling cars--rather than condemning the business interests that fight against sane urban planning and the provision of walkable cities and decent public transport, while on top of that, holding back alternatives to the internal combustion engine and insisting on selling more and more vehicle per consumer. They condemn consumers for shopping so much--rather than condemning the corporations that opt for built-in obsolescence and throwaway goods rather than their refusal to produce durable, low-maintenance goods that non-specialists can cost-effectively repair themselves. Condemn consumers for responding to pointless product differentiation, advertising and the innumerable pressures business places on them to buy new goods when the old ones are still working--rather than the businesses that engage in those practices.
At every point, they condemn those who had the least say in the matter for their choices--while letting those who had far, far more say off the hook. I have discussed where this comes from in the past enough times and in enough ways to feel no need to enlarge on it here, but I do not think the essential point can be overstated enough. What we need is not to deprive the millions and billions of comfort and choice, but rather to give them real choices--the choice of more leisure rather than more things, the choice of a walk or transit instead of a car, the choice to not keep buying throwaway items--while taking sustainability into account when determining the production methods by how which industry meet their needs, as they and not an elite telling them "You don't need that!" in the tone haves have always used with have-nots, determine them.
The Moral Equivalent of War
Originally posted at RARITANIA on July 17, 2013.
In 1977 President Jimmy Carter declared the energy crisis the "'moral equivalent of war'--except that we will be uniting our efforts to build and not destroy."
This seems a plausible outlook given the sheer scale of the task of moving beyond fossil fuels, and the broader ecological crisis more generally. Yet this challenge has consistently failed to draw forth such an intensity of response--or anything close to it--among either the public, or its "leaders." Hurricane Katrina, which left some eight thousand dead and missing, evoked no analogies with Pearl Harbor in the press--and nor did the more recent Hurricane Sandy.
One does not have to search very far to find explanations for the gap between such rhetoric, and what actually followed it. There is, for instance, the character of the problem, a process apprehended only with the capacity to connect numerous manifestations with a vast, complex process unfolding over decades and centuries, and doing so largely outside the view of the comfortable--such that there is room (however minute or rapidly shrinking) for doubt about its even existing at all. As the bombs fell on London during the Blitz, no one doubted that Britain was at war. But watching hurricanes careen like pinballs about the Gulf of Mexico, or ravage Manhattan twice in as many years, some still find it possible to dismiss such events as "weather" rather than evidence of climate change.
There is also something about a struggle with a human opponent, however simplistically given a human face and conceived as "evil" and made a socially sanctioned target for aggressive and hateful feelings that engages the passions in a way that other, more impersonal problems do not, least of all our environmental problems, which are far too complex to be convincingly presented as a simple tale of heroes and villains.1
And of course, the familiar reward of an epic battle against such a villain is absent. In modern times wars have been fought with the promise of a better life afterward--a world safe for democracy; a country fit for heroes; broad, sunlit uplands. (Even the "New World Order" of which Bush the First spoke after Cold War and Gulf War, while hardly on a level with the soaring rhetoric which gave the world the phrases listed above, reflected the tendency.) The "and then what?" of grappling with our environmental problems is far less clear than any of these. "Sustainability" may be the only sane principle for our relationship to the environment, but it leaves much to be desired as inspiration.2 And what some hold sustainability to require, learning to live on less, is certainly uninspiring, especially to the vast majority who have never had very much. One might in fact say that environmentalism has lacked a sense of the utopian (in that term's best sense).
And of course, there is the sheer "inconvenience" of the truth, meeting an ecological challenge less than congenial to innumerable vested interests. It is certainly the case that there are plenty of opportunities to make money in the course of rebuilding the world's energy base--but old, established, powerful parties would see accustomed activities changed or curtailed, and the short-term profits on which they focus to the exclusion of nearly all else threatened.
At any rate, such a response to the problem is a challenge to the premises of business in general given the implicit subordination of the forms of growth business values (of firms, of incomes, of markets), and the autonomy and prestige it enjoys now as in few other eras, to other goods and imperatives. It is worth remembering, too, that growth has long been a solvent for social tensions, one which has not been perfectly satisfactory but nonetheless effective to a considerable degree (even as it has become increasingly illusory), and that the prospect of the disappearance, or even diminution, of that solvent can only raise fears about seeing those tensions intensify.
Naturally there is not only resistance to acceptance of the problem's existence, but active effort on the part of powerful groups to obfuscate it, to minimize it, to trivialize it--something all the easier to do given the issue's ambiguities. And so in the end we have wound up in a position where there is widespread anxiety about the prevailing state of affairs, but the expectation of meaningful action on the problem all too often seems like wishful thinking.
1. Of course, that is not to deny the culpability of vested interests and the responsibility of numerous personally powerful individuals in causing avoidable damage and thwarting efforts to solve the problem. As C. Wright Mills observed, the idea that "we all possess equal powers to make history . . . is sociological nonsense and political irresponsibility." Yet the problem deeply involves a whole way of thinking about the world, and a whole system for dealing with it, far bigger than any one individual.
2. Economist Herman Daly defined sustainable use as one's not consuming a resource at a greater rate than that that at which it might be renewed (in the case of renewables); substitutes found for it, which would themselves be subject to that same consumption standard (in the case of nonrenewables); or "recycled, absorbed or rendered harmless" (in the case of pollutants). See Donella H. Meadows, Jorgen Randers, Dennis Meadows, The Limits to Growth: The 30-Year Update (White River Junction, VT: Chelsea Green Publishing, 2004), p. 54.
Why I Do Not Support "Degrowth"
The idea of "degrowth" has never sat well with me--and it increasingly astonishes me that people who think of themselves as "progressives" can have ever espoused it. The simple reality is that, however little a good many patterns of production and consumption contribute to human well-being or happiness (and indeed, however repugnant we may find aspects of contemporary culture), by and large, a life in which we have more has really been a life in which we live better than we would otherwise do.
No reasonable person comparing the way we live now to the toil, want, dirt, ignorance, violence, insecurity, ill health, mortality of pre-industrial times--when parents buried the great majority of their children long before they reached adulthood--can possibly think the old days were "good old days." No reasonable person considering the world as it is now, with a billion people not having enough to eat, and many billions more lacking adequate shelter, education, medical treatment, and other necessities as a world where the biggest and most common problem is that people have too much. (The billionaires, who number two thousand on a world approaching eight billion, are not the standard here, nor the tiny minority of McMansion-dwelling, SUV-driving bourgeois, and anyone who thinks so only shows how far removed they are from any kind of social reality, and have not earned the right to speak of these matters at all.)
Far from wanting to revert to the harsher conditions of pre-industrial life, what we should want is to extend the benefits of modernity to all, broadly speaking, and deepen them for everyone. A world where everyone has their needs met, and indeed, can think beyond merely meeting need--because, after all, the realm of freedom lies only beyond that of necessity.
Of course, we are living through an ecological crisis, at the root of which is the Industrial Revolution's geometrical intensification of our consumption of our world's finite natural resources, which has reached grossly unsustainable proportions, and as things are, seems likely to get only worse as we suffer the problem's increasingly severe effects. All of that seems to moot the hope of that more prosperous, more comfortable word--until one considers the last, critical part of that preceding sentence "as things are." Why could things not be otherwise? We have technology. We have social knowledge as well. Between the two we could come up with solutions. Yet it is commonplace for writers on these subjects to treat them as if they offer no hope whatsoever.
Is this view based on a thorough assessment of our technological and organizational potentials?
This does not generally seem to be the case--those potentials just about never discussed. It seems to me that the "cowspiracy" crowd is exemplary of the tendency. They make claims (and highly disputable ones at that) about the contribution of livestock- and especially cattle-raising to the very real problem of climate change--and insist that people must give up animal products, rather than asking whether those products can be produced in more sustainable ways. A recent study, for instance, suggests that the addition of a small amount of seaweed to cow feed can virtually eliminate cows' methane emissions, while cellular agriculture raises the prospect of having beef without cows entirely, with even more impressive results--but all of this is commonly ignored in discussion of these matters (as the Cowspiracy missionaries endlessly demonstrate).
To the extent that such possibilities do enter the dialogue, there is a tendency to consider them in the most negative possible terms--as in one BBC report baldly asserting in its title that "Cultured Meat May Make Climate Change Worse." An examination of the article, however, shows that it simply compared estimates of greenhouse gas emissions from cattle to those they projected from the production process required for "alt-meat"--and that the "may" here rested on an understanding of the situation that I will summarize as follows:
It does not.
One might also point out that besides the direct output of emissions from the production process there are other factors worth considering, not least the implications of cultured meat for land use. Presently over a quarter of the world's ice-free land area is utilized for grazing. Eliminating that use would create enormous potential for, for example, reforestation efforts that could do a great deal to offset our greenhouse gas emissions. Does this come up? No. The article instead acknowledges in the abstract that numerous other environmental factors would have to be considered in a proper appraisal of the environmental impact of the two possibilities, but offers as its only specific example a negative one, namely cultured meat's possible production "of organic or chemical molecule residues" in waste water (apparently considered in isolation from how this stacks up against the considerable water pollution resulting from today's industrial farming).
Taken altogether the piece looks like an exercise in bad science and technology reporting (in which it often seems we are drowning) that can come off as all but intended to quash the hopes reports about the technology may have raised. Were such exercises a rarity I would not take it as significant, but it seems to me that such pieces are quite commonplace, and highly influential, while they raise the question--Why should such a tendency be so widespread?
Alas, at this point we must consider a bit of political history. Optimism about what we can do with technology and organization is the legacy of the Enlightenment, and its argument for the potentials of human reason to understand and master the world. This has taken two forms--the liberal, and the radical, in the classical sense of these terms. The "liberal" conception, exemplified today by Silicon Valley techno-libertarianism, holds that technology will, in a society at least minimally consistent with its ideals of secure property rights and broad latitude for business, automatically make the world a better place. The "radical" conception (which not so long ago did not look so radical) thinks it will take some help from politics--at the very least, a social system where societal decisions are not all based on the individual short-term interest of the rich as they try to get richer and to hell with everything else.
The liberal conception, already looking questionable in the nineteenth century, looks very threadbare today, not just in its results but in its intellectual premises (TANSTAAFM, after all), while the radical conception has been thoroughly persecuted, and marginalized for decades. The resulting vacuum has been filled by ideas that were already reactionary in Victorian times--Malthusianism, Luddism, and the rest--which hardly make them likely to try and seek out those who can picture a different and happier kind of modernity, or "reinvent the wheel" to envision such possibilities on their own.
And so they feel themselves faced with a choice between believing in Silicon Valley's promises of broad sunlit uplands of super-modernity if the billionaires are allowed to continue calling all the shots, which seem none too convincing, or try to picture us not being modern at all, which means going back to what existed before the modern, more or less ("postmodern" all too often meaning "premodern"). Rather than trying to reengineer large, modern systems, they try and picture life without large, modern systems. Trade that car for a bike! Eat beans instead of something you would actually like (especially at the end of that exhausting bike ride)! Let us have composting communal toilets and just one square of toilet paper per visit! Use local currency! And so on and so forth.
Almost at once one anyone alert to the scale of the problem is struck by strain, by desperation, in such pronouncements--such as there always is when someone is trying to make much less suddenly go round, especially when the cost of everything is rising sharply. When we take the approach and its implications as a whole, globally, it appears probable that those who have little will have still less as the world's population continues to rise from seven and a half to ten billion as the climate change already locked in and unchallengeable by anything but large organizations and new technology drives billions of them from their home and rising seas and hotter summers and more extreme weather events wreak havoc with their ability to feed themselves with current methods, let alone the less productive, localist, "organic" kind so beloved by the degrowth crowd. Some, generally the poorest and weakest, will suffer more than others, in cases much more--and it is only the most simple-mindedly secure and entitled who imagine that they will passively starve to death rather than fight to survive. Can anyone imagine that our living in the thermonuclear age would be totally irrelevant in such a scenario?
Never mind the long-term flourishing of the human species and the planet on which we live. This won't get us through the short term, let alone the long, that older spectre of war getting us before the environmental catastrophe does. Fortunately I am unconvinced that the bright-sided optimism of the techno-libertarians and degrowth are the only two choices. In fact, everything I have learned looking at society, history, the technical potentials available to us, and the severity of the crisis at hand (there has already been too much damage to the environment for anyone to take seriously the hope that just doing less will save us), convinces me otherwise--and that it is only the third choice that not only holds out the hope of a world worth living in, but any hope of survival at all.
No reasonable person comparing the way we live now to the toil, want, dirt, ignorance, violence, insecurity, ill health, mortality of pre-industrial times--when parents buried the great majority of their children long before they reached adulthood--can possibly think the old days were "good old days." No reasonable person considering the world as it is now, with a billion people not having enough to eat, and many billions more lacking adequate shelter, education, medical treatment, and other necessities as a world where the biggest and most common problem is that people have too much. (The billionaires, who number two thousand on a world approaching eight billion, are not the standard here, nor the tiny minority of McMansion-dwelling, SUV-driving bourgeois, and anyone who thinks so only shows how far removed they are from any kind of social reality, and have not earned the right to speak of these matters at all.)
Far from wanting to revert to the harsher conditions of pre-industrial life, what we should want is to extend the benefits of modernity to all, broadly speaking, and deepen them for everyone. A world where everyone has their needs met, and indeed, can think beyond merely meeting need--because, after all, the realm of freedom lies only beyond that of necessity.
Of course, we are living through an ecological crisis, at the root of which is the Industrial Revolution's geometrical intensification of our consumption of our world's finite natural resources, which has reached grossly unsustainable proportions, and as things are, seems likely to get only worse as we suffer the problem's increasingly severe effects. All of that seems to moot the hope of that more prosperous, more comfortable word--until one considers the last, critical part of that preceding sentence "as things are." Why could things not be otherwise? We have technology. We have social knowledge as well. Between the two we could come up with solutions. Yet it is commonplace for writers on these subjects to treat them as if they offer no hope whatsoever.
Is this view based on a thorough assessment of our technological and organizational potentials?
This does not generally seem to be the case--those potentials just about never discussed. It seems to me that the "cowspiracy" crowd is exemplary of the tendency. They make claims (and highly disputable ones at that) about the contribution of livestock- and especially cattle-raising to the very real problem of climate change--and insist that people must give up animal products, rather than asking whether those products can be produced in more sustainable ways. A recent study, for instance, suggests that the addition of a small amount of seaweed to cow feed can virtually eliminate cows' methane emissions, while cellular agriculture raises the prospect of having beef without cows entirely, with even more impressive results--but all of this is commonly ignored in discussion of these matters (as the Cowspiracy missionaries endlessly demonstrate).
To the extent that such possibilities do enter the dialogue, there is a tendency to consider them in the most negative possible terms--as in one BBC report baldly asserting in its title that "Cultured Meat May Make Climate Change Worse." An examination of the article, however, shows that it simply compared estimates of greenhouse gas emissions from cattle to those they projected from the production process required for "alt-meat"--and that the "may" here rested on an understanding of the situation that I will summarize as follows:
Methane is a more potent greenhouse gas than carbon dioxide, but it cycles out of the atmosphere more rapidly. A shift to cultured meat would eliminate the methane emissions, but mean more carbon emissions because of the industrial process. While having less warming effect, their lingering longer in the atmosphere would mean an accumulation over time that could make the larger contribution to the climate change we want to avoid.That long-run carbon emissions from cultured meat production may offset the benefits gained from the reduction in methane emissions is a more nuanced, qualified, claim than the title seems to me to imply (it did say "may," but I suspect that for most this was secondary to the "make climate change worse"), and the piece's problems do not stop there. Why, for example, should it be the case that cultured meat would mean more carbon emissions? The piece is rather vague on this point. The most that I can say is that it seemed to assume that the cultured meat production process would rely on fossil fuels. However we are in a world beginning to move away from such sources, a movement that anyone slightly concerned for the environment hopes can and will be quickened. One would expect our powering the process through renewables (or nuclear energy) to make a difference. Does the article mention this?
It does not.
One might also point out that besides the direct output of emissions from the production process there are other factors worth considering, not least the implications of cultured meat for land use. Presently over a quarter of the world's ice-free land area is utilized for grazing. Eliminating that use would create enormous potential for, for example, reforestation efforts that could do a great deal to offset our greenhouse gas emissions. Does this come up? No. The article instead acknowledges in the abstract that numerous other environmental factors would have to be considered in a proper appraisal of the environmental impact of the two possibilities, but offers as its only specific example a negative one, namely cultured meat's possible production "of organic or chemical molecule residues" in waste water (apparently considered in isolation from how this stacks up against the considerable water pollution resulting from today's industrial farming).
Taken altogether the piece looks like an exercise in bad science and technology reporting (in which it often seems we are drowning) that can come off as all but intended to quash the hopes reports about the technology may have raised. Were such exercises a rarity I would not take it as significant, but it seems to me that such pieces are quite commonplace, and highly influential, while they raise the question--Why should such a tendency be so widespread?
Alas, at this point we must consider a bit of political history. Optimism about what we can do with technology and organization is the legacy of the Enlightenment, and its argument for the potentials of human reason to understand and master the world. This has taken two forms--the liberal, and the radical, in the classical sense of these terms. The "liberal" conception, exemplified today by Silicon Valley techno-libertarianism, holds that technology will, in a society at least minimally consistent with its ideals of secure property rights and broad latitude for business, automatically make the world a better place. The "radical" conception (which not so long ago did not look so radical) thinks it will take some help from politics--at the very least, a social system where societal decisions are not all based on the individual short-term interest of the rich as they try to get richer and to hell with everything else.
The liberal conception, already looking questionable in the nineteenth century, looks very threadbare today, not just in its results but in its intellectual premises (TANSTAAFM, after all), while the radical conception has been thoroughly persecuted, and marginalized for decades. The resulting vacuum has been filled by ideas that were already reactionary in Victorian times--Malthusianism, Luddism, and the rest--which hardly make them likely to try and seek out those who can picture a different and happier kind of modernity, or "reinvent the wheel" to envision such possibilities on their own.
And so they feel themselves faced with a choice between believing in Silicon Valley's promises of broad sunlit uplands of super-modernity if the billionaires are allowed to continue calling all the shots, which seem none too convincing, or try to picture us not being modern at all, which means going back to what existed before the modern, more or less ("postmodern" all too often meaning "premodern"). Rather than trying to reengineer large, modern systems, they try and picture life without large, modern systems. Trade that car for a bike! Eat beans instead of something you would actually like (especially at the end of that exhausting bike ride)! Let us have composting communal toilets and just one square of toilet paper per visit! Use local currency! And so on and so forth.
Almost at once one anyone alert to the scale of the problem is struck by strain, by desperation, in such pronouncements--such as there always is when someone is trying to make much less suddenly go round, especially when the cost of everything is rising sharply. When we take the approach and its implications as a whole, globally, it appears probable that those who have little will have still less as the world's population continues to rise from seven and a half to ten billion as the climate change already locked in and unchallengeable by anything but large organizations and new technology drives billions of them from their home and rising seas and hotter summers and more extreme weather events wreak havoc with their ability to feed themselves with current methods, let alone the less productive, localist, "organic" kind so beloved by the degrowth crowd. Some, generally the poorest and weakest, will suffer more than others, in cases much more--and it is only the most simple-mindedly secure and entitled who imagine that they will passively starve to death rather than fight to survive. Can anyone imagine that our living in the thermonuclear age would be totally irrelevant in such a scenario?
Never mind the long-term flourishing of the human species and the planet on which we live. This won't get us through the short term, let alone the long, that older spectre of war getting us before the environmental catastrophe does. Fortunately I am unconvinced that the bright-sided optimism of the techno-libertarians and degrowth are the only two choices. In fact, everything I have learned looking at society, history, the technical potentials available to us, and the severity of the crisis at hand (there has already been too much damage to the environment for anyone to take seriously the hope that just doing less will save us), convinces me otherwise--and that it is only the third choice that not only holds out the hope of a world worth living in, but any hope of survival at all.
The Dark Roots of Neoliberal Environmentalism
I recently took up the issue of neoliberal environmentalism in a post on this blog (and other places, like a recent book review for Strange Horizons). Central to the discussion has been the way in which environmentalism, emergent in the neoliberal era, accommodated itself to neoliberal thinking, shrinking from even mild reformism of capitalism in favor of a fixation on individual conduct and "market"-friendly solutions that can be nicely summed up as "agonize over your carbon footprint while the corporations actually responsible for climate change (a mere hundred of them account for 71 percent of emissions) do what they want" (and the same going for every other environmental problem as well).
Still, one must acknowledge that this was not merely a matter of deference to orthodox economic ideas on the part of environmentalists in an era generally uncongenial for progressive politics, but also a matter of the ideas on which many environmentalists have elected to build their movement. There is the Malthusianism that began with its namesake's attack on provision for the poor and the possibility of alternative to capitalism on behalf of tax-hating property owners, and which has ever since continued to fulfill the same purposes in other hands (like Jack Goldstone's writings). There is the "localist" and "small-is-beautiful" ethic that is nothing so much as a petit bourgeois fear and hatred of modern scale--the attitude not of the working person, but the small business owner who incessantly talks rugged individualism but really thinks the world owes them prosperity. And there is the suspicion of technology and deep social critique (Luddism, disbelief in "grand narratives"), and outright misanthropy, that at a glance is recognizably derived from the darkest and most brutal of the counter-Enlightenment tradition (think the inanities of wannabe Nazi court philosopher Martin Heiddeger) by way of the ultra-reactionary force that has been postmodernism.
The receptiveness to such ideas seems enhanced by a host of unfortunate proclivities that I do not think can be called "ideas" per se, and certainly not ideas about the environment, society or anything else. One is, to borrow Emmanuel Todd's term, a "zombie religiosity" to which the wearing of hairshirts, not least environmental hairshirts, appeals (especially if they are the kind to be more concerned with expiating a sense of personal guilt with gestures than actually addressing a problem). There is the detestation of "consumerism" and modern convenience that is largely a matter of the distaste the affluent have for the consumption choices of those less well-off than themselves, whom they choose not to understand and for whom they have, in the end, little to no sympathy, so that they readily begrudge them any and all comfort and pleasure and choice. This often goes hand in hand with the light-mindedness that thinks a reversion to pre-industrial life will be like one long camping trip and wouldn't that be fun!--or the blend of simple-mindedness and selfishness that takes it for granted that the sacrifices will be borne by others while they somehow go on being comfortable in some oasis of modern convenience. (They will keep their McMansions, SUVs and cell phones, but those Third Worlders--tough luck.)
And, quite frankly, there are those who seem to have an appetite for what Leigh Phillips terms "collapse-porn," with James Howard Kunstler exemplary in his having a "veritable hard-on for the end of the world, imagining with relish the coming Peak Oil collapse, a retreat from modernity, and an embrace of the Medieval."
Say what one might about judging ideas by their sources, these are profoundly unpromising sources of or premises for a meaningful solution to any large problem, let alone the one we face now, and I often find myself wondering if the publicity accorded these ideas does not in itself reflect their awfulness. Neoliberal environmentalism is not a perfect fit with the other kinds, one reason why right-wingers' denunciation of even this kind of environmentalism is deep and genuine. However, it not only diverts the public from other, more threatening approaches, but it also looks deeply unappealing itself. Given the choice between neoliberalism, and its techno-utopian PR, and Kunstler, and only these, a great many people, even those well-aware of our predicament, and alert to the failings of the techno-utopian view, will hope that the techno-utopians are right and things will just somehow work out in the end.
Still, one must acknowledge that this was not merely a matter of deference to orthodox economic ideas on the part of environmentalists in an era generally uncongenial for progressive politics, but also a matter of the ideas on which many environmentalists have elected to build their movement. There is the Malthusianism that began with its namesake's attack on provision for the poor and the possibility of alternative to capitalism on behalf of tax-hating property owners, and which has ever since continued to fulfill the same purposes in other hands (like Jack Goldstone's writings). There is the "localist" and "small-is-beautiful" ethic that is nothing so much as a petit bourgeois fear and hatred of modern scale--the attitude not of the working person, but the small business owner who incessantly talks rugged individualism but really thinks the world owes them prosperity. And there is the suspicion of technology and deep social critique (Luddism, disbelief in "grand narratives"), and outright misanthropy, that at a glance is recognizably derived from the darkest and most brutal of the counter-Enlightenment tradition (think the inanities of wannabe Nazi court philosopher Martin Heiddeger) by way of the ultra-reactionary force that has been postmodernism.
The receptiveness to such ideas seems enhanced by a host of unfortunate proclivities that I do not think can be called "ideas" per se, and certainly not ideas about the environment, society or anything else. One is, to borrow Emmanuel Todd's term, a "zombie religiosity" to which the wearing of hairshirts, not least environmental hairshirts, appeals (especially if they are the kind to be more concerned with expiating a sense of personal guilt with gestures than actually addressing a problem). There is the detestation of "consumerism" and modern convenience that is largely a matter of the distaste the affluent have for the consumption choices of those less well-off than themselves, whom they choose not to understand and for whom they have, in the end, little to no sympathy, so that they readily begrudge them any and all comfort and pleasure and choice. This often goes hand in hand with the light-mindedness that thinks a reversion to pre-industrial life will be like one long camping trip and wouldn't that be fun!--or the blend of simple-mindedness and selfishness that takes it for granted that the sacrifices will be borne by others while they somehow go on being comfortable in some oasis of modern convenience. (They will keep their McMansions, SUVs and cell phones, but those Third Worlders--tough luck.)
And, quite frankly, there are those who seem to have an appetite for what Leigh Phillips terms "collapse-porn," with James Howard Kunstler exemplary in his having a "veritable hard-on for the end of the world, imagining with relish the coming Peak Oil collapse, a retreat from modernity, and an embrace of the Medieval."
Say what one might about judging ideas by their sources, these are profoundly unpromising sources of or premises for a meaningful solution to any large problem, let alone the one we face now, and I often find myself wondering if the publicity accorded these ideas does not in itself reflect their awfulness. Neoliberal environmentalism is not a perfect fit with the other kinds, one reason why right-wingers' denunciation of even this kind of environmentalism is deep and genuine. However, it not only diverts the public from other, more threatening approaches, but it also looks deeply unappealing itself. Given the choice between neoliberalism, and its techno-utopian PR, and Kunstler, and only these, a great many people, even those well-aware of our predicament, and alert to the failings of the techno-utopian view, will hope that the techno-utopians are right and things will just somehow work out in the end.
Friday, April 12, 2019
What Might a Green New Deal Involve? Additional Notes
Previously I raised the issue of what a Green New Deal might look like--the scale on which it might work, the speed with which it might attain its goals, and the manner in which it might be resourced. Today I am writing about the principles to which such a plan might adhere. I would argue that there are four.
1. Scale.
As previously discussed here, climate change is a colossal challenge that, in light of its severity, profundity and pace, demands a colossal response. Such challenges quite naturally lead Americans to historical analogy with World War II. A look at the production effort seen in World War II (what it suggests about how rapidly the U.S. could rebuild its infrastructure, industrial plant, and other systems) suggests that it is a logical starting point for such consideration. The reality is that the circumstances in which a Green New Deal would be carried out would be far more congenial, not least because of the greatly increased productivity of modern industry, and one can well imagine that as a result even a total, short-order rebuild needed to, for example,w reduce emissions by 2030 to a small fraction of present levels, and perhaps establish a negative-emissions program, might actually be considerably cheaper than waging and winning that conflict (in relative terms). Still, any Green New Deal worthy of the name would be massive in scale, enough so that I would expect a commitment of at least a double-digit percentage of GDP for a period.
2. Global Thinking.
Massive as the program would be relative to the budget and the economy the U.S. is only one country, one economy, accounting for only a fraction of the world's greenhouse gas emissions. An American Green New Deal cannot be expected to save the world by itself. Other countries will have to do their part. A U.S. Green New Deal should encourage others to do the same, and where possible, help them to do so, while at the same time benefiting from the benefits of other countries' own efforts--like such technologies as they develop. The result is that while an American Green New Deal cannot be made contingent on other countries' conduct, it should be backed by a diplomatic effort aimed at bringing about, if not a Global Green New Deal, then many other Green New Deals (Chinese and European and the rest), while being attentive to others' progress in the same area, and providing such foreign aid as is affordable to the developing nations accounting for a rising proportion of global emissions.
3. Pragmatism.
Carrying out such an unprecedented program will necessarily mean doing "what the job takes," even where this may seem unpalatable. Previously I noted the World War II effort's massive remaking of America's plant, power grid and other physical capital. It is worth remembering that of the massive construction of plant during World War II, close to two-thirds was government-built and government-owned, because that seemed in the circumstances the only way to get so much built so quickly, with the achievements of the "arsenal of democracy" ultimately validating this logic (not least, when compared with the more market-oriented, slower mobilization of World War I).
In short, the power of government to solve problems was utilized to a very great degree in these years, because nothing else would serve. So does it appear to be the case again when we consider climate change--with the idea of major government action in regard to the energy base in particular less unprecedented than it may seem. The Federal government has in the past owned a significant share of America's electrical generation and distribution, with the Tennessee Valley Authority only the most famous instance, and it has proven competent to run it--along with a good deal of other energy-related infrastructure (whether nuclear fuel production, the armed forces' massive utility infrastructure, oil production at Naval Petroleum reserves, and everything else), the partial privatization of which was a matter of ideology, not necessity. The decisions were questionable at the time, but what matters most now is that neoliberal pieties such as the superiority of the private to the public in all things, or the worship of balanced budgets as an idol besides which one shall have no others (which, alas, neoliberal Republicans have been the most contemptuous of in practice), have not only been shown up as wrong time and time again, but have no place in a serious effort to resolve the problem at hand.
4. Equity.
One of the greatest weaknesses of the modern environmental movement, emergent as it was in a neoliberal era, has been its lack of concern for power, social class, equity. As the situation stands, after half a century of neoliberalism the poor have done all the sacrificing--while the rich have pocketed what was taken from them, as the growth in the size of their yachts shows.* Attempting to redress climate change in this manner, as the government of Emmannuel Macron so stupidly did, is not only morally repugnant, but bad politics at a moment when long-battered working people are beginning to assert themselves. Concern for equity--for protecting society's poorest and weakest, and to the extent possible in the circumstances, actually uplifting them--must be part of the plan. Indeed, it is promised in the very name of a proposal recalling what, for all its failures and limitations, was far and away the single greatest attempt of government in the United States to act on behalf of the people in the wake of capitalism's most dramatic failure--the Green New Deal.
So there you have it. A Green New Deal must be of a scale appropriate to the problem, which ultimately means that it must not only be a massive initiative by U.S. standards, but also part of a global solution. It must be pragmatic, with this pragmatism demonstrated by a readiness to do what the situation demands, rather than what neoliberal shills and their owners think pleasant. And it must be equitable, not only for the sake of that principle, but the aforementioned need to be pragmatic as well. Any plan that fails to meet even of these criteria is sorely incomplete. Any plan that fails to meet all of them is unworthy of being called a plan at all. As always, be watchful, be skeptical, and DO NOT be impressed by compromised mediocrities who will lecture you on the "art of the possible" or bully you with sanctimonious, contemptuous, let-them-eat cake drivel about your "wanting a pony" while unapologetically heading off to Goldman Sachs to take more money for one speech than the median American household will see in a decade.
*In the '80s the Trump Princess was the world's biggest, and thought so extravagant the makers of the James Bond movie Never Say Never Again thought it worthy of being the base for a SPECTRE villain. The last time I checked there were seventy-five boats bigger than that, with the largest making it look a rowboat.
1. Scale.
As previously discussed here, climate change is a colossal challenge that, in light of its severity, profundity and pace, demands a colossal response. Such challenges quite naturally lead Americans to historical analogy with World War II. A look at the production effort seen in World War II (what it suggests about how rapidly the U.S. could rebuild its infrastructure, industrial plant, and other systems) suggests that it is a logical starting point for such consideration. The reality is that the circumstances in which a Green New Deal would be carried out would be far more congenial, not least because of the greatly increased productivity of modern industry, and one can well imagine that as a result even a total, short-order rebuild needed to, for example,w reduce emissions by 2030 to a small fraction of present levels, and perhaps establish a negative-emissions program, might actually be considerably cheaper than waging and winning that conflict (in relative terms). Still, any Green New Deal worthy of the name would be massive in scale, enough so that I would expect a commitment of at least a double-digit percentage of GDP for a period.
2. Global Thinking.
Massive as the program would be relative to the budget and the economy the U.S. is only one country, one economy, accounting for only a fraction of the world's greenhouse gas emissions. An American Green New Deal cannot be expected to save the world by itself. Other countries will have to do their part. A U.S. Green New Deal should encourage others to do the same, and where possible, help them to do so, while at the same time benefiting from the benefits of other countries' own efforts--like such technologies as they develop. The result is that while an American Green New Deal cannot be made contingent on other countries' conduct, it should be backed by a diplomatic effort aimed at bringing about, if not a Global Green New Deal, then many other Green New Deals (Chinese and European and the rest), while being attentive to others' progress in the same area, and providing such foreign aid as is affordable to the developing nations accounting for a rising proportion of global emissions.
3. Pragmatism.
Carrying out such an unprecedented program will necessarily mean doing "what the job takes," even where this may seem unpalatable. Previously I noted the World War II effort's massive remaking of America's plant, power grid and other physical capital. It is worth remembering that of the massive construction of plant during World War II, close to two-thirds was government-built and government-owned, because that seemed in the circumstances the only way to get so much built so quickly, with the achievements of the "arsenal of democracy" ultimately validating this logic (not least, when compared with the more market-oriented, slower mobilization of World War I).
In short, the power of government to solve problems was utilized to a very great degree in these years, because nothing else would serve. So does it appear to be the case again when we consider climate change--with the idea of major government action in regard to the energy base in particular less unprecedented than it may seem. The Federal government has in the past owned a significant share of America's electrical generation and distribution, with the Tennessee Valley Authority only the most famous instance, and it has proven competent to run it--along with a good deal of other energy-related infrastructure (whether nuclear fuel production, the armed forces' massive utility infrastructure, oil production at Naval Petroleum reserves, and everything else), the partial privatization of which was a matter of ideology, not necessity. The decisions were questionable at the time, but what matters most now is that neoliberal pieties such as the superiority of the private to the public in all things, or the worship of balanced budgets as an idol besides which one shall have no others (which, alas, neoliberal Republicans have been the most contemptuous of in practice), have not only been shown up as wrong time and time again, but have no place in a serious effort to resolve the problem at hand.
4. Equity.
One of the greatest weaknesses of the modern environmental movement, emergent as it was in a neoliberal era, has been its lack of concern for power, social class, equity. As the situation stands, after half a century of neoliberalism the poor have done all the sacrificing--while the rich have pocketed what was taken from them, as the growth in the size of their yachts shows.* Attempting to redress climate change in this manner, as the government of Emmannuel Macron so stupidly did, is not only morally repugnant, but bad politics at a moment when long-battered working people are beginning to assert themselves. Concern for equity--for protecting society's poorest and weakest, and to the extent possible in the circumstances, actually uplifting them--must be part of the plan. Indeed, it is promised in the very name of a proposal recalling what, for all its failures and limitations, was far and away the single greatest attempt of government in the United States to act on behalf of the people in the wake of capitalism's most dramatic failure--the Green New Deal.
So there you have it. A Green New Deal must be of a scale appropriate to the problem, which ultimately means that it must not only be a massive initiative by U.S. standards, but also part of a global solution. It must be pragmatic, with this pragmatism demonstrated by a readiness to do what the situation demands, rather than what neoliberal shills and their owners think pleasant. And it must be equitable, not only for the sake of that principle, but the aforementioned need to be pragmatic as well. Any plan that fails to meet even of these criteria is sorely incomplete. Any plan that fails to meet all of them is unworthy of being called a plan at all. As always, be watchful, be skeptical, and DO NOT be impressed by compromised mediocrities who will lecture you on the "art of the possible" or bully you with sanctimonious, contemptuous, let-them-eat cake drivel about your "wanting a pony" while unapologetically heading off to Goldman Sachs to take more money for one speech than the median American household will see in a decade.
*In the '80s the Trump Princess was the world's biggest, and thought so extravagant the makers of the James Bond movie Never Say Never Again thought it worthy of being the base for a SPECTRE villain. The last time I checked there were seventy-five boats bigger than that, with the largest making it look a rowboat.
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