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December 01, 2007

« Quality of Place | Main | New World Order »

Herb Gintis is hands-down one of the sharpest minds of his generation.  Here, (via Greg Mankiw) he dissects what is wrong with American liberalism, the Democratic Party, and why any revival will require new thinking and directions. Oh, and along the way, he pummels Paul Krugman's new book about inequality.  Interesting thing is Krugman is not alone here is his static, partisan Fordist thinking. Virtually all of his colleagues on the New York Times' oped - and especially Friedman, Brooks, Herbert and Rich - are locked in a 20th century time-warp, clinging to stereotypical and overtly political positions which obscure more than they reveal about the real laws of motion of  our economy and society.

This book epitomizes what is wrong with American liberalism. Krugman was a fine, perceptive international trade theorist, but he is a political hack, with nothing new to offer. There is one problem as far as Krugman is concerned: inequality. But inequality is an intellectual abstraction, not a politically motivating issue. People hated the Robber Barons because they were robbers and barons, not because they were rich. Oprah Winfrey and Bill Gates do not send the Pinkerton men out to protect their ill-gotten gains; nor to the other super-rich. Socialists' ringing political slogans dealt with fairness, social progress, and power to the people, not "inequality." Moreover, a truly progressive movement must built on technical progress that is impeded by the reigning powers that be ... not the beggar-thy-neighbor, zero-sum-game sort of redistribution favored by Krugman...

I am sorry that we can't do better than Krugman. There are very serious social problems to be addressed, but the poor, pathetic, liberals simply haven't a clue. Conservatives, on the other, are political sophisticated and hold clear visions of what they want. It is too bad that what they want does not include caring about the poor and the otherwise afflicted, or dealing with our natural environment. Politics in the USA is no longer Elephants and Donkeys; it is now conservative Pigs and liberal Bonobos. The pigs are smart but only care about what's in their trough. The Bonobos are polymorphous perverse and great lovers, but will be extinct in short order.



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Interesting attack on Krugman's book, but all Gintis manages to do is to repeat conservative economic talking points mixed in with the usual tripe about "liberals" and how "they just don't understand how the world really works" bullshit. I think after more than 6 years of conservative economics (with all of the inequality that it is designed to promote), it is no wonder that most Americans are concerned about the economy. So yeah, Mr.Gintis is off base if he thinks that redistributionist policies don't resonate with the American people. My favorite quote is this, though "Conservatives, on the other, are political sophisticated and hold clear visions of what they want."...that really makes me laugh. The other thing that made me laugh was his prediction that liberalism is extinct reveals just out of touch many conservatives are about the political mood in this country....better take off the blinders, or you guys are going to take a bite out of a large shit sandwich in '08.

Michael Wells

I hardly know where to start. Weren't we talking yesterday about reducing name calling and poorly thought out polemics? "Anytime a writer or blogger talks about what The Right or The Left (or some subset thereof) really wants or means, I'd like them to list their personal anthropological experience with the subjects under consideration."

I went to Gintis's review hoping for more than his quote above promised, but it's a right-wing party line attack. His history is weak (People hated the Robber Barons because they were robbers and barons, not because they were rich.... Socialists' ringing political slogans dealt with fairness, social progress, and power to the people, not "inequality.") Has he actually read any Socialist writing from the 20's & 30's? It's full of anti-rich sentiment.

But Gintis is most misleading in how he defines inequality. I think most liberals and independents would say the inequality problem isn't at the top, but at the bottom. Most people don't care that Bill Gates is rich (and by the way is supporting inheritance taxes) or that Warren Buffet is rich (and by the way is supporting a fairer income tax structure). They care instead that millions of Americans lack health care, that full time workers have to go to food banks, that people are having their homes foreclosed because of financial institutions incompetence, that we're mortgaging our children's future through federal borrowing to pay for unproductive and unnecessary tax cuts. These are all problems of inequality that people care about. Let's get our terms clear.

I haven't seen Krugman's book, so can't comment on it specifically. He is a little nostalgic for strong unions but otherwise I haven't found him to be unrealistic or advocating "begger-thy-neighbor redistribution".

There are serious issues in the US and the world. Nobody has all the answers, liberals or conservatives. We're not solving them by name-calling.


Michael - Interesting. I didn`t find Gintis` post to be name-calling. But now I`ll read it again. Maybe it`s because they are both economists and both left leaning. But I will re-read. In any case, I`m open to posting links to things that don`t meet Cowen`s stipulation. I`ll just try not ever to write them.


In a Fordist world, the level of progressivity of the Federal income tax (which offsets regressive taxes like sales) was a fit subject of debate in economics and public policy. In a post-Fordist world, Republican tax policy is the very best tax policy possible. Any other policy is "beggar thy neighbor," and Krugman and others who talk about it should just shut up.

Same with health care policy, Krugman's favorite topic du jour. While broadly pooling risk might have made sense in the old-fashioned Fordist world, now that we're, like, post-Fordist and stuff, we realize that the very best system is one where the profits lie in denying care, claims, and insurance to those who need it most. Anyone who thinks otherwise is just pathetic and so last century.


Ken - Nicely said. Now this is getting interesting. It seems to me the Fordist world - or should I say the mass political struggles of the Fordist world - led to these large scale corporate and state solutions. The post-Fordist world as I wrote in Rise downloads risk on the individual. Now the funny thing is individuals are choosing this more flexible world. People for some reason or another in this day and age - and economy of relative affluence - value self-expression. That is all well and fine, but there needs to be some mechanism, as you imply, a SOCIAL mechanism, for dealing with this risk. This is how I would frame the first principles of that issue. It is no longer enough or sufficient to simply provide for material needs ala the best of Fordism, that is Scandinavian social democracy. Post-Fordism - heck call it the creative economy requires that we ensure that each person can use his or her full potential and realize their full self-expression in ways that are economically rewarding to both them and society. The end state of society is not simply material well-being it is self-expression and fulfillment. What really keeps me up at night is that there is not a single political leader or movement around the world that is able to articulate something like this. As Brink Lindsay has said: Conservatives want to bring back the family of the 50s, liberals want to bring back its economy. The real task is to design a social partnership system for the creative age.


I'm not quite getting what your point is....you seem to be talking in a kind of New-Agey, Tony Robinson, "everyone creates their own reality" style of nonsense. Health care, whether it be from an individuals own pocket or from government subsidies is something everyone needs. Sure, let's get creative, but let's not pooh pooh the ideas of someone like Paul Krugman who understand that a minimal level of material well being (like access to basic health care) is necessary for for that "self expression and fulfillment". You chose to give positive spin to what is really a tirade against a liberal thinker who has very specific ideas on how to deal with the economic insecurity many in this country face.

Jon Husband

Regardless of creative expression (whether completely by the self / individual or by groups) we still live in societies and probably will continue to do so. And I think that a basic measure of basic values is how a society deals with the health care and education possibilities and / or opportunities for all the members of that society .. not just for those who can (however that may come about) afford those two basics.

These two fundamental aareas of human activity are in my opinion two key differentiators between Canada and the USA (though Canada is becoming increasingly America-like) and I am guessing that most Canadians understand that a decent part of their taxes are responsible for that difference. I am also guessing that more Canadians would prefer to remain in a Canadian society than live in a society that is becoming more American.

Yes, of course I am generalizing.


One might respond to Gintis' post by asking whether a society can even remain a democracy in the context of drastic inequality of outcomes. Aristotle said no. I tend to agree with Aristotle.

Gintis might also take a look at a short piece called 'Garrison America' by his frequent collaborator Sam Bowles in order to get a better sense for the consequences of inequality. Bowles writes: "But by our preferred estimates (which we explain shortly), roughly one in four in the United States economy is now engaged in guard labor—providing security for people and property and imposing work discipline. Since 1890 the guard labor fraction of the United States labor force has increased four-fold. And in Sweden today the guard labor fraction is less than half that of the United States." Then later on in the article he has a handy little scatterplot where he plots the percentage of US state employment in guard/security/'protective services" vs income inequality (measure as a gini). He finds a startling positive linear relationship between the variables, interpreted to mean that as income inequality in a State goes up, so does the percent of the labor force in the security apparatus. So he looks empirically, and finds this same effect at both the inter- and intra- national levels. Higher inequality, more lockdown. And maybe also, higher lockdown, lower self-expression? (He also finds that nations with more social expenditures and social democracy - like Scandinavia - were the countries with the lowest labor percent in security apparatus.

It seems like inequality can be empirically shown to have rather undesirable social consequences, even if it doesn't directly motivate people to radical action. People like gintis I'm sure know this. Not sure what he was thinking with that review of Krugman.

(The Bowles papers are available here: http://www.santafe.edu/~bowles/papers.htm)

Michael Wells

Huh. OK, I re-read Gintis too, and while I think he's snide and misses the point about inequality, maybe he's responding to some of Krugman's points. And maybe he's just got more sense of irony than I gave him credit for (smart conservatives and lover liberals).

However, it shouldn't be a choice between material well-being and self-actualization. Maslow actually did have a point about basic needs. While it's a work in progress, most of the countries at the top of the creative index follow the social democracy model. It's not perfect and there will hopefully be better models, but that doesn't mean it's not working better than the mess the US is making of our economy and social system.

Richard Florida

Michael - Ah yes. You nailed it. Material well-being is essential, but self-actualization is what motivates people. I heard this time and time again in the research for Rise. The start point is to recognize the importance of both. Krugman's thinking is old school fordist. Fine for that age. Out of touch with our time. We need a social partnership system for the creative age. That's not new agey at all. It recognizes that every person is an asset that needs to be nutured and treasured. That each and every one of us have creative talents that must be released. And that self-expression and self-expression are not only higher-order but basic human needs. Allowing them to flourish will enable human beings to develop more fully and the economy to grow. I fear the US is on the downside of history and falling out of this debate. New models are being built elsewhere. Heck, I saw one up close and personal in Noosa Australia, where leaders are combing creativity, sustainablity and inclusiveness. And yes, inequality is corrosive. Just look at American politics. Solving it will require a broad social movement, based on the principles outlined above. Sooner or later we need to leave the 50s and 60s behind and get on with the far more serious business of building a creative, sustainable and inclusive economic and social system. It's what were up to here in Toronto.

Michael Wells

So maybe Krugman is good on identifying problems, weak on solutions. If Richard is right about the magnitude of transformation we're going through, we need solutions to get us through. There were massive disruptions and suffering in the change from agriculture to industrial economies. We can't afford to do that this time.

What I find about labels like statist is that they're too abstract. Back when "Small is beautiful" was the rage somebody (Bucky Fuller?) said "Small isn't better. Bigger isn't better. Better is better." Likewise I don't think it matters a lot who provides a solution -- government, business, NGO's or others. I think the issue is what works in people's lives. I have the same problem with free market cranks like Randy O'Toole that I had with Socialist cranks in the '60's. They're more interested in the theology of the marketplace than in the effects in real people's lives.

Richard, I agree completely that no political leaders or movements are able to articulate this or mobilize around it. Probably Bill Clinton came the closest to understanding it in the US, but couldn't do anything with it -- partly because the Democratic Party was too caught in the past and complacent, as Gintis implies.


Michael - The disruptions are already here. They are just starting to surface and they will be profound and problematic. I am amazed how clueless national level leadership is globally. The more this is ignored, the more it will fester. I liked Bill Clinton just fine. But I also think he bears some responsibility for the current state of affairs. He allowed this stiff to fester under the surface and to go unaddressed setting the stage for Bush, and our current era of fear and anxiety.


Why is it that whenever the left vs. right skirmish is dissected by The Very Fair-Minded and Important People of Today their findings always show that it is the left that is stupid, unfair, out of touch and so on? And that it is the right that is smart, down to earth and bending over backward to bring more Americans into their big tent? And who needs the Pinkertons when the robber-barons of today can legally get away with predatory lending, when individuals cannot file for bankruptcy and when the justice system is stacked on the side of The Corporation?


This thread is now old, but I take issue with the idea that social insurance is incompatible with the creative economy. On the contrary, it should serve to enhance labor mobility and risk taking, as key "needs" would no longer be tied to one's job. Look, I personally have chosen opportunity over security, something that's easy for me to do as I have no dependents. If I did, I'd worry a lot more about health insurance than I do.

Further, this stuff about "partisanship" is also puzzling. If I fundamentally disagree with the other party's policy framework, I'm not going to set that aside for the sake of not appearing partisan--I'm going to work to defeat them, as they are working to defeat my side.

Note finally that the small nation states Prof. Florida has identified in a recent post as being well positioned to benefit from a global creative economy seem to be further along in addressing these issues than we are, and in a direction that Prof. Krugman would admire.

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