Elizabeth Warren: The Coming Collapse of the Middle Class

The following lecture features Elizabeth Warren speaking about the current crisis in (and looming collapse of) the American middle class.

This presentation is almost 58 minutes, but I highly recommend it for anyone interested in long term social and economic trends and the future of the middle class. Warren is a Harvard law professor who is a well-known commentator on debt and family issues. (She’s even appeared in Michael Moore’s Capitalism: A Love Story.) In this lecture, her basic thesis is that the typical American family (two parents, two kids) does indeed earn more income – even adjusted for inflation – than its counterpart in the early 1970’s. This is mainly due to the addition of a second income, usually from the wife. On the other hand, there have been many extraordinary increases in costs (mostly inelastic) that have overtaken this increase in income, to the point that the 1970’s family actually has more disposable income and more financial flexibility.

There are many impressive aspects to her presentation. First, it shows the relevance and usefulness of good statistical data. It is culturally fashionable to dismiss statistics, but the evidence Warren uses is illuminating and provocative. It confirms some things I felt were true, but have never been able to confirm or quantify. Second, her conclusions seem difficult to ignore or refute, and they are plainly scary if one thinks about them for too long. Warren’s point about the move from a three-class society to a two-class society is particularly chilling. Third, while certain cost challenges are clearly American in nature (e.g. health insurance), many others, like housing and education, pertain to middle class Canadians like myself. Finally, her insights into the declining costs of food and clothing, as opposed to the increasing costs of electronics and child care, provide a sense of fairness and balance that is often missing in popular political discourse. Generally speaking, this is a thought-provoking use of an hour.

Posted by Colin Welch at 1:51 PM
Edited on: Friday, July 16, 2010 2:49 PM
Categories: American Politics, Canadian Politics, Education, Global Issues, Modern Culture, Technology, The Economy

 

David Harvey: Getting to the Heart of the Matter

For all of the discussion about the causes of the latest economic meltdown, it’s mystified me why inequality has been largely ignored.

The blame is almost always laid at the feet of proximate factors like negative savings rates, ponzi-like housing bubbles, exotic debt instruments, deregulation and a neo-liberal faith in the corrective nature of unbridled capitalism. But none of these explanations really get to the heart of why the crisis occurred. These explanations aren’t irrelevant, to be sure, but they seem to be intermediate factors at best, factors which themselves are the consequences of deeper and longer-term problems. Just like the assassination of Archduke Ferdinand was merely the spark that ignited a host of issues that built up before 1914, this current economic downturn has longer and more serious causal antecedents.

To me, the key issue is inequality. I don’t mean inequality in moral terms, which is often how it is cast. I mean inequality in terms of a functional problem for capitalism. In economies where consumer spending predominates (the USA, 67% of GDP; in Canada, 56%), the prime concern is getting money (back) into the hands of those who will immediately reintroduce it into our communities. Spending is the life-blood of our western economies. Without a doubt, saving and investment are important for long-term growth, but consumption is the key to economic circulation and moving savings to investment. Yet this has been a problem since the 1970’s, when real income and wealth, adjusted for inflation, started to stagnate or decline for all but the richest quintile of North American citizens.

In this context, policies and programs designed to encourage people to spend have had to encourage debt, because the money isn’t otherwise there. Debt, in other words, is the inevitable by-product of pro-consumption policies that ignore systemic inequality. This is where David Harvey comes in. His analysis is unabashedly Marxian, but, to the extent that his explanation strives to uncover the root issues, it’s clear that such an analysis can’t be ignored. Of course, I’m not really mystified why we are silent with regard to inequality. Once you admit that inequality is a central explanation, then a Marxian analysis is almost unavoidable. And capitalists and capitalist societies simply don’t want to open that debate. (Well, not always.)

The following is a succinct and visually arresting summary of David Harvey’s argument:

Posted by Colin Welch at 9:45 AM
Edited on: Wednesday, July 14, 2010 7:34 PM
Categories: Global Issues, In a Philosophical Mood, The Economy

 

America’s Housing Crisis – A Moral Dilemma?

The following video from 60 Minutes is a sobering look at America’s continuing housing crisis.

It’s also an interesting discussion of a central contradiction in capitalism. On one hand, business people and corporate entities often make bloody-minded decisions that leave individuals jobless and homeless. As “rational actors” pursuing “the bottom line”, these capitalists are rarely condemned by our elites. Indeed, their “tough minded” decisions are often lauded as good business. On the other hand, the very same economic decisions by individual citizens and unions are almost always assessed (and condemned) in moral terms, terms which North Americans have historically internalized against their own interests.

Yet it now appears that this ideological double-standard is being exposed by the mortgage problems faced by millions of Americans. As a result, we can catch a glimpse of the political underpinnings inherent in the supposedly amoral world of economics.

 

Comic Sans: The Write Type?

Apparently some people don’t like the Comic Sans font:

“Comic Sans walks into a bar, and the bartender says, “We don’t serve your type.”

But seriously, here’s a response in defense of our favourite faux handwriting font:

http://motherjones.com/kevin-drum/2010/06/quote-day-comic-sans-fights-back

……………….

Here’s another somewhat backhanded endorsement of Comic Sans. Honest.

Posted by Colin Welch at 8:59 PM
Edited on: Sunday, June 20, 2010 1:55 PM
Categories: Humour, Language, Modern Culture, Technology

 

Chinese Labour Costs are Going Up

A number of recent newspaper articles (for example, here and here) have been published regarding the climbing costs of labour in China. For some, this is a worrisome trend that foreshadows lower profits and higher consumer prices, and a shift in manufacturing to even lower cost (!) countries. Others note that this is a typical trend for any industrializing country, particularly one that wants to make the shift from an economy that is export dependent to an economy that relies on domestic consumption. [In Canada, consumer spending accounts for about 57% of GDP; it’s 67% in the USA.] What better country than China to rely on domestic consumption!

Of course, these articles generally avoid the painful truth for capitalists: greater relative equality (created largely by a stronger union movement) will be necessary before a mature consumer society can develop. Too bad the neo-liberals in the West have forgotten this historical verity.

China’s evolution is similar to what the West faced 100 to 200 years ago, and provides us with some perspective on the de-industrialization that North America has faced: perhaps we are not alone!

I’m also reminded of Karl Marx’s intriguing (and mistaken?) endorsement of free trade, and by extension the global spread of capitalism: [T]he protective system of our day is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favor of free trade.

Posted by Colin Welch at 8:08 PM
Edited on: Tuesday, June 08, 2010 10:32 PM

 

Health Care Costs: Relative to GDP or Gov’t Spending?

One of the best reasons to read The Tyee is Will McMartin. He is a rare journalist with the ability and desire to wade through the BC government’s own stats in order to separate the wheat from the chaff.

In his latest article on health care spending, McMartin exposes the myth that health care spending is out of control and outstripping our ability to pay for it. Put briefly, McMartin shows that, as a percentage of BC’s GDP, health care costs are relatively static. Rather than comparing health care costs to overall government spending, which has gone down as a percentage of GDP, McMartin compares health care costs to GDP itself, which is the measure of overall economic output. As such, he shows that health care is not out of control, and we can continue to pay for it – assuming we don’t want to keep lowering taxes. Health care might be taking a bigger slice of government spending, but a bigger share of a consciously reduced spending envelope doesn’t change the fact that the real costs of health care have not gone through the roof. In other words, if the BC Liberals choose to reduce taxes and reduce their overall revenue and spending, that shouldn’t be used as a battering ram against “rising” health care costs.

Posted by Colin Welch at 9:16 PM
Edited on: Monday, June 07, 2010 9:56 PM
Categories: BC Politics, Canadian Politics, The Media

 

Sheldon Wolin

Let us return to Sheldon Wolin. In this entry, I want to briefly discuss the third chapter of Wolin’s Politics and Vision*. His key point is that political philosophy takes a sharp turn after the classic Greek city-states succumb to the Macedonian Empire. This philosophical shift continues and intensifies as the Roman Republic turns into the Roman Empire.

The nature of the change is directly related to the change of the dominant political unit. Gone is the time of a relatively compact and homogeneous polis; it is replaced by a sprawling, heterogeneous empire. Unlike the polis, an empire is marked by complexity, class and regional interests, and a massive enlargement of political space. Also unlike the polis, where citizens are engaged in direct and meaningful dialogue regarding the affairs of their city, in an empire the average citizen is subordinated to an autocratic ruler and his bureaucracy. In other words, where “loyalty had earlier come from a sense of common involvement, it [is] now to be centered in a common reverence for power personified” (p. 69).

This has two effects on the analysis of politics. First, political philosophy retreats from its political obligations, and ultimately becomes a form of “vapid moralism” (p. 85). Though some Greek thinkers of the Macedonian period, like Isocrates, are explicitly political (and urge a form of federalism to transcend Greek particularism), the philosophers after Plato and Aristotle are by and large those who reject an “intensive participation in a life of common concerns” (p. 69). This turn away from active citizenship is a natural effect of a distant, imperial hierarchy, and the Good is now defined – contrary to Pericles, Plato and Aristotle – as “political disengagement” (p. 71). Both the Cynics and the Epicureans are dominated by “strong elements of despair and withdrawal” that are “nourished by an anti-political impulse” (ibid) similar to modern libertarianism. The dominant philosophy of the Roman era, Stoicism, is well-known for its appeal to a universal rationality that binds nature and rational beings into a brotherhood of equality and freedom. So far, so good. But for Wolin, Stoicism shares the disillusionment of imperial politics with the Cynics and Epicureans: “its philosophic outlook [is] not derived from a positive view concerning the nature of a truly political order, but from a conclusion about its insufficiency” (p. 73). The Stoics are committed to moral development that lies outside politics since the “bureaucratized and highly impersonal public life of the Empire [has] only the slenderest ties with man’s potentiality for moral development” (p. 75). Moreover, the naturalism of Stoicism displaces any notion of social conflict with a “quasi-religious” (p. 84) desire for harmony, and men are “exhorted to extend their allegiance to the cosmos as though it were a true society” (p. 74). The best that can be said for Stoicism is that it becomes, under the Roman Empire, a useful “code of conduct for public magistrates and administrators” (ibid).

The second major effect of Empire on political analysis is that it’s soon dominated by historians and politicians (e.g. Polybius and Cicero). Their analyses are a study of technique, compromise and pragmatism. They also focus on the role of institutions, largely because institutions and their procedures help rulers wrestle with complexity. No longer do philosophers venerate a participatory politics that uplifts the soul; in the Roman era, students of politics seek – as we might say in Canada – peace, order and good governance. Interestingly, Wolin seems somewhat sympathetic to this trend. While Polybius and Cicero might be overly optimistic when they view politics as a balance of power, they are “basically correct in drawing attention to the fundamental importance of institutions in legitimizing conflict among diverse forces and interests” (p. 76).

Some interesting themes emerge from Wolin’s analysis. His concern for the unsettled world of every-day politics persists. However, he is not content with the simple interest-based politics of Cicero. Wolin is fearful of those periods “when politics is reduced to nothing but the pursuits of interests, when no controlling standards of obligation are recognized” (p. 81). And indeed, in the Roman experience, mistrust of principle as merely the lexiconic mask of naked interest helps lead to the collapse of the Republic. From this Wolin concludes that society “cannot long endure uncontrolled political conflict, and the inevitable reaction is to demand peace at any price” (p. 82). Somewhere, amid the rancour of factional struggle, we must find values and principles that we can all agree to, and which we obey even when our “particular interests or ambitions are not always being served” (p. 80).

The struggle between unity and difference rears its head again.

_____________

* Wolin, Sheldon. Politics and Vision, Expanded Edition (Princeton University Press, Princeton), 2004.

 

Posted by Colin Welch at 4:24 PM
Edited on: Wednesday, May 26, 2010 7:44 PM
Categories: In a Philosophical Mood, Language, Sheldon Wolin

Sunday, March 28, 2010

Reading Wolin, Part 2: Plato and Politics

What is “politics”? According to Chp. 2 of Sheldon Wolin’s Politics and Vision*, it’s certainly not an intellectual conception he shares with Plato.

Plato’s vision of politics is of the Good: the right and just principles that are common to all rational beings, and that ought to govern their political community. It is a philosophical conception, in the sense that his vision is derived from reason, yet practical because it reflects a serious attempt to imagine a real and tangible Good Society. But Plato’s quest for a tabula rasa, on which society is to be reconstructed with the help of a philosopher king (as in The Republic) or a philosopher-legislator (as in The Laws), always points to the same conclusion: “absolute power yoked to absolute knowledge” (p. 45). To be sure, Plato does not aim for a totalitarian solution. Far from it. Plato is repeatedly concerned with the excesses of power. His solution is a search for the Forms, eternal verities which transcend time, place and historical convention. With knowledge of the Forms, and the leadership of Rational people suffused with a “deep longing of the purified soul” (p. 52), Plato argues that the corruption of power will be overcome. In Wolin’s words, it is the assuring logic of all Rationalists: “when political power is joined to knowledge it loses its compulsive element” (ibid).

Wolin disputes this vision of politics. According to Wolin, politics is defined as the activity of citizens within a given geographical area who work (or struggle) to resolve common problems under the condition of scarcity (of resources, status and authority). It is fundamentally a vision of conflict (p. 11). From this perspective, there is no real sense of politics in Plato’s writings, precisely because Wolin’s politics is a communal activity that does not aim at Truth. Plato contributes little to issues like political participation, because such concerns imply a need for consent and conventionality that have little time for the Universal Good. Against Plato, Wolin argues that any political “agreement that issues from participation is not intended as a symbol of truth but as a tangible expression of that sense of belonging which forms a vital dike against the forces of anomie” (p. 58). And beyond legitimization, politics “involves a judgment concerning claims, all of which possess a certain validity” (ibid). In other words, it is a balance of competing “opinions” that leads to “tentative stabilities within a situation of conflict” (p. 60).

Wolin rebukes others, like Leo Strauss, who laments that “agreement may produce peace but it cannot produce truth” (quoted in Wolin, p. 57). Plato, Strauss and others have refused to see politics for what it is: an activity that is necessary in and of itself, and which can’t be transcended. Arguing otherwise, says Wolin, is simply “fatuous” (ibid). As such, political philosophy cannot ignore judgments of conciliation and compromise. It must be about conciliation and compromise, and the communal nature that frames these “tentative stabilities”. A “political judgment, in other words, is ‘true’ when it is public, not public when it accords to some standard external to politics” (p. 58). Moreover, any idea of transcendence leads to a “hollowing out of political content”, and makes the issues of political obligation, political community and the existence of competing interests “dangerously irrelevant” (p. 48). Dissent and contrary political views, from Plato’s logic, can only be seen as untruth, and untruth is mere steps away from a totalitarian solution.

………………

I find myself very sympathetic to Wolin’s critique of Plato. It certainly mirrors my own reading of Plato (particularly The Republic), and reflects the shock I had when I first read Plato’s prescriptions for a new and better world. Two concerns do surface, however. First, Wolin never satisfactorily explains the irreducibly pluralistic nature of politics. It’s posited with a few examples, but there is no systematic discussion to buttress his point of view. Perhaps we shall see more about this later. Similarly, I am somewhat disenchanted with Wolin’s conception of power. So far, it seems very simple and clear-cut; power is explicit decision making on behalf of particular interests over others. It seems much like the first level in Steven Lukes’ three levels of power. Maybe later we will see a greater concern with non-decision making and the covert shaping of desire… and discourses of truth.

_____________

* Wolin, Sheldon. Politics and Vision, Expanded Edition (Princeton University Press, Princeton), 2004.

Posted by Colin Welch at 7:20 PM
Edited on: Sunday, May 23, 2010 5:24 PM
Categories: Books, In a Philosophical Mood, Language, Sheldon Wolin

Thursday, March 18, 2010

Reading Wolin, Part 1: Philosophies, Theories and Ideologies

In the world of political thought, philosophies, theories and ideologies are traditionally viewed as distinct entities. A philosophy is considered a systematic and logical understanding of the world arrived at primarily through reason and intellect. A theory is also said to be systematic and logical, but aims to represent empirical data and observed evidence. In other words, social scientific theory aspires to a certain level of verisimilitude – a correspondence between explanation and the real, tangible world. Finally, an ideology is a set of beliefs – again, said to be internally systematic and coherent – that has, at its core, a functional political agenda, a worldview that organizes groups either in favour of or against the status quo. Thus, philosophies, theories and ideologies may all set their gaze on politics, and seek a sense of coherence and truthfulness, but they are distinguished by their respective emphases on rationality, science or political action.

Nevertheless, there are many who see little difference between philosophies, theories and ideologies. The respected political philosopher, Sheldon Wolin, treats these as interchangeable terms: “Of all the restraints upon the political philosopher’s freedom to speculate, none has been so powerful as the tradition of political philosophy itself. In the act of philosophizing, the theorist enters into a debate the terms of which have largely been set beforehand” (Wolin 21). Moreover, philosophy and theory, particularly in the realm of political knowledge, are inherently programmatic. Most political thinkers, even Plato, “have believed that precisely because political philosophy was ‘political,’ it was committed to lessening the gap between the possibilities grasped through political imagination and the actualities of political existence” (ibid 20).

To Wolin, all three types of political thought are united by their common goals: to make sense of our political lives, and to provide the clearest account of the realities and potentials of politics.

_____________

* Wolin, Sheldon. Politics and Vision, Expanded Edition (Princeton University Press, Princeton), 2004.

Posted by Colin Welch at 6:06 PM
Edited on: Sunday, May 23, 2010 5:23 PM
Categories: In a Philosophical Mood, Language, Sheldon Wolin

 

Reading Wolin, Part 3: Not-So-Political Philosophy in the Age of Empire

Let us return to Sheldon Wolin. In this entry, I want to briefly discuss the third chapter of Wolin’s Politics and Vision*. His key point is that political philosophy takes a sharp turn after the classic Greek city-states succumb to the Macedonian Empire. This philosophical shift continues and intensifies as the Roman Republic turns into the Roman Empire.

The nature of the change is directly related to the change of the dominant political unit. Gone is the time of a relatively compact and homogeneous polis; it is replaced by a sprawling, heterogeneous empire. Unlike the polis, an empire is marked by complexity, class and regional interests, and a massive enlargement of political space. Also unlike the polis, where citizens are engaged in direct and meaningful dialogue regarding the affairs of their city, in an empire the average citizen is subordinated to an autocratic ruler and his bureaucracy. In other words, where “loyalty had earlier come from a sense of common involvement, it [is] now to be centered in a common reverence for power personified” (p. 69).

This has two effects on the analysis of politics. First, political philosophy retreats from its political obligations, and ultimately becomes a form of “vapid moralism” (p. 85). Though some Greek thinkers of the Macedonian period, like Isocrates, are explicitly political (and urge a form of federalism to transcend Greek particularism), the philosophers after Plato and Aristotle are by and large those who reject an “intensive participation in a life of common concerns” (p. 69). This turn away from active citizenship is a natural effect of a distant, imperial hierarchy, and the Good is now defined – contrary to Pericles, Plato and Aristotle – as “political disengagement” (p. 71). Both the Cynics and the Epicureans are dominated by “strong elements of despair and withdrawal” that are “nourished by an anti-political impulse” (ibid) similar to modern libertarianism. The dominant philosophy of the Roman era, Stoicism, is well-known for its appeal to a universal rationality that binds nature and rational beings into a brotherhood of equality and freedom. So far, so good. But for Wolin, Stoicism shares the disillusionment of imperial politics with the Cynics and Epicureans: “its philosophic outlook [is] not derived from a positive view concerning the nature of a truly political order, but from a conclusion about its insufficiency” (p. 73). The Stoics are committed to moral development that lies outside politics since the “bureaucratized and highly impersonal public life of the Empire [has] only the slenderest ties with man’s potentiality for moral development” (p. 75). Moreover, the naturalism of Stoicism displaces any notion of social conflict with a “quasi-religious” (p. 84) desire for harmony, and men are “exhorted to extend their allegiance to the cosmos as though it were a true society” (p. 74). The best that can be said for Stoicism is that it becomes, under the Roman Empire, a useful “code of conduct for public magistrates and administrators” (ibid).

The second major effect of Empire on political analysis is that it’s soon dominated by historians and politicians (e.g. Polybius and Cicero). Their analyses are a study of technique, compromise and pragmatism. They also focus on the role of institutions, largely because institutions and their procedures help rulers wrestle with complexity. No longer do philosophers venerate a participatory politics that uplifts the soul; in the Roman era, students of politics seek – as we might say in Canada – peace, order and good governance. Interestingly, Wolin seems somewhat sympathetic to this trend. While Polybius and Cicero might be overly optimistic when they view politics as a balance of power, they are “basically correct in drawing attention to the fundamental importance of institutions in legitimizing conflict among diverse forces and interests” (p. 76).

Some interesting themes emerge from Wolin’s analysis. His concern for the unsettled world of every-day politics persists. However, he is not content with the simple interest-based politics of Cicero. Wolin is fearful of those periods “when politics is reduced to nothing but the pursuits of interests, when no controlling standards of obligation are recognized” (p. 81). And indeed, in the Roman experience, mistrust of principle as merely the lexiconic mask of naked interest helps lead to the collapse of the Republic. From this Wolin concludes that society “cannot long endure uncontrolled political conflict, and the inevitable reaction is to demand peace at any price” (p. 82). Somewhere, amid the rancour of factional struggle, we must find values and principles that we can all agree to, and which we obey even when our “particular interests or ambitions are not always being served” (p. 80).

The struggle between unity and difference rears its head again.

_____________

* Wolin, Sheldon. Politics and Vision, Expanded Edition (Princeton University Press, Princeton), 2004.

 

Posted by Colin Welch at 4:24 PM
Edited on: Wednesday, May 26, 2010 7:44 PM
Categories: In a Philosophical Mood, Language, Sheldon Wolin

 

Measuring the Internet

I remember back to the good old days of Alta Vista when they could actually count the number of pages on the ‘Net. Like McDonald’s hamburgers, the number of websites and pages now appears too large to measure. Nevertheless, here’s a really fascinating site that attempts to quantify the Internet in terms of type and share:

http://news.bbc.co.uk/2/hi/technology/8562801.stm

Posted by Colin Welch at 11:31 AM
Edited on: Sunday, May 16, 2010 9:21 PM