3.0 out of 5 stars
The Ideologification of Economics, April 20, 2011
In light of the current world financial crisis, and despite the fact that it is now 25 years old, this book deserves to be reread. In addition to putting to rest (if not completely destroying) competing ideological myths about the nature of both the national and the international economy, it provides the background to better understand what can and cannot be done to fix the current global economic problem.
For sure, the way we have arrived at the present economic crossroads is through long vicious historical struggles of the same "Yankee-Cowboy War" that is also being waged culturally and politically within the U.S.: Only this time it is more dramatically clear that the underlying basis has always been primarily economic. The narratives that provide the language and backdrop for the author's discussion (and most of the tension between the opposing sides) are the twin myths of "rugged individualism" (for the Cowboys' side), and a need for "compassionate government intervention" (on the Yankee side). Oddly, in recent years they have begun to lose what was once an essentially economic character in favor of loose unrelated cultural and emotional aspects.
No matter how they are characterized, both positions are basically specious emotional abstractions that have very little to do with economic reality. In point of fact, it has always been the case that "economic ground truth" is to be found somewhere at the intersection of the two ideological abstractions. For success, both sides depend on fiscal stimulus to generate economic growth through a combination of tax cuts and spending increases. Falling on the sword of ideologically purity for either side can (and usually does) spell economic suicide. The plutocrats on either side of this issue, know very well that this is indeed the case. So why do we allow them to use us as their proxies?
This author basically argues that since the "Great Depression," the Yankee side had held the winning hand through Keynesian economics -- that was, up until the 80s when Keynesianism was effectively uprooted and overturned by the Reagan supply-side economic and ideological insurrection. It mattered little that at the time, the Reagan OMB director David Stockman had "let the cat out of the bag" by admitting that Reagan's supply side doctrine was little more than a Trojan Horse to bring the tax rates on the rich down; or that George H. Bush (during the Republican Primary in which he ran against Reagan) had referred to these same proposals as "voodoo economics."
What happened is that the Cowboys' argument -- even as it wore thin as an economic myth and even though all along it had had dubious value as an economic theory -- still had already begun to have immense emotional and ideological appeal. Now that economics since Reagan have been completely ideologized, the super national economy which rode in on the wave of Reaganism and Thatcherism, now holds complete sway -- functioning as it does as a kind of "stateless" ATM machine that draws its sustenance not so much from philosophical principles and moral edicts as from the taxes of the nations it exploits, and from the myth of "rugged individualism, etc., but also and most importantly, from bending and changing the rules of capitalism to suit the needs of the unending greed of a handful of "stateless plutocrats" -- no matter what the rules of sound economics may imply?
With no masters, no purposes and no morality higher than their own greed, deregulation, privatization and even free enterprise itself cease to make any economic sense or have any political or ideological meaning? We have now descended into an economic world without rules and therefore without meaning. However, those who are being exploited -- mostly the conservative classes from around the world (but especially within the U.S.) -- nevertheless hold on to the old meanings, thinking and acting like the plutocrats, who share their ideological positions, are also their economic soul mates?
It is an enduring "con job" that mysteriously even as the world experiences a melt-down due to the suicidal greed of a handful of Wall Street Money Mandarins," and even as the gap between the conservative poor and the conservative rich (the Money Mandarins) increases without bounds, this curious connection between the classes continues to gain ground?
However, according to this author, this economic argumentation by ideologification and cheap emotional demagoguery is a well-worn canard that could not be further from the truth of our economic situation. The purpose of government and the contract between the government and the people simply cannot be allowed to get lost in the emotional and ideological scuffles orchestrated by the "Money Mandarins," who are beholden only to the bottom lines of their respective portfolios.
However, beyond feeble suggestions of continuing to split the differences, I do not see any solution in the proposals offered up here that I would take to the bank. If the problem is greater than our current knowledge can support, I wish the author had had the courage to say so. Waffling is not the proper way forward. I realize that the economic situation in 1986 was quite a bit less dire than it is today, but still, courage is courage. Three Stars.
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