I think this worth sharing. Robert Reich was labour secretary for Bill Clinton and has just retired from teaching. His substacks are worth reading.
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Excellent. And for us dummies, just as good at half speed!
Just what I need for my Sociology classes, as they do NONE of this in history or any other subject. Thanks!
In your post about the pointlessness of only spotting a recession after it happens, you said something I did not altogether agree with.
Long ago, when I was a sort of scientist, we would form a hypothesis, do the experiment several times, and look at the good or bad results of the treatment.
We have the results of austerity for 14 years and they don’t look encouraging. But compared to what? Robert Reich’s video is nice, because it shows that, in the past, other strategies have been much more successful.
But a better comparison would be the results over the last 14 years for other countries which have used different strategies. Which countries have done better or worse? Perhaps conventional economics is so powerful that alternatives have not been tried? Or is “the market” so powerful that any country adopting another strategy will be punished?
There are no other strategies of note to compare with now. Neoliberalism totally dominates.
Hence why we have to do linear comparisons.
This is brilliant, so simple and so clear. A British equivalent would make a great billboard campaign. I wonder if Led by Donkeys has seen this!?
It would be very expensive…
But not as expensive as the car crash we are heading for is something doesn’t change?
I am a follower.Reich makes many thoughtful and insightful contributions to a wide range of topics. This message delivered visually is very succinct and powerful.
As much as I admire Reich I have two issues with this.
First, it’s so often overlooked that a major trigger for the change in the structure of western industrialised economies was the period of oil crises 1973-1979 (price hikes and for some countries, shortages) which injected inflation, exacerbated existing wage-price spirals and increased unemployment.
The crisis created a window of opportunity for the neoliberal economists, enabling them to claim that Keynesianism no longer worked. Combined with the ending of Bretton Woods (Nixon’s closing of the gold window in 1971) and Volcker’s “put” (pumping up Federal Reserve rates which reached 20% in 1981) this led to high unemployment and ushered in the era of wage stagnation and accelerated globalisation and offshoring to minimise production costs.
The high oil prices collapsed in 1985/6 as new non-OPEC production came online and Saudi Arabia increased output to try and reclaim market share. As today, the inflation was transitory. As today, central banks pressed on trying to squeeze out inflation.
“Volcker was a deficit hawk who benefited from the revolving door between government and Wall Street; fought to crush organized labor; hurt millions of working-class people; and deliberately misled the public to avoid political responsibility for his actions.”
https://www.thenation.com/article/economy/volcker-inflation-economy/
“Testifying before the Joint Economic Committee in October 1979, Volcker flatly declared, “The standard of living of the average American has to decline. I don’t think you can escape that.”
https://prospect.org/economy/paul-volcker-without-tears/
Conventional economics does not understand the critical role of energy in the economy, only considering capital and labour in its production functions. They do not understand thermodynamics, and that it is energy that does the useful work. Machines and humans are “merely” energy conversions (transforming fuels, electricity and in the latter, food, into useful work). This was illustrated recently in Germany where economists incorrectly (surprise!) forecast that gas price rises and shortages would result in only a tiny loss of industrial output. Not so.
Secondly, Reich does not give us any clues as to how change can come about. The enormous power of the Israel lobby in much of the western world has recently been made highly visible, but far less visible are the powerful lobbies of business and finance and, in the US of course there is the NRA which ensures a steady supply of domestic American carnage. In Australia there is no gas or oil or mining project that either the current Labor or a Liberal-National Coalition government would reject or dare to tax.
I don’t think it’s an exaggeration to say that our democracies have been fully captured by these lobbies. The major media organisations all sing in tune with them. The duopolies offer only Tory-plus and Tory-lite, and where voting systems are proportional, whatever the flavour of the coalition, it will be bound by neoliberal economics and unable to use the spending power of the state to address social and economic problems. When voters elect an ostensibly progressive government that has failed them they end up disillusioned (which explains Trump, and NZ’s recent rejection of Labour for a hard right racially divisive coalition). It seems that the only way is rightwards in this new age of oligarchs with their PJs, super yachts and luxury ex-ICBM bunkers (or a “lifeboat” in NZ) just in case.
Movements and peaceful mass protests (where they are still legal) no longer have any significant impact (except maybe in some marginal state with a CIA supported “colour revolution”?).
Bill McKibben (link to interview below), who I otherwise have nothing but admiration for, reflecting on 30 or more years of failure to achieve reductions in CO2 emissions still seems to think the answer is yet more “movements.”
Perhaps the answer is to adopt the lobby model? Is a lobby of the 99% even conceivable? Could it raise the funds in order to buy the politicians, establish the network of think tanks, and so on?
Perhaps, in the duopolies, the answer is the long haul to establish a third party. But as we saw with Corbyn, the establishment will do everything in its power to crush a popular progressive politician (add the Israel lobby if they dare to support justice for the Palestinians). Corbyn’s destruction was of course aided by his own party. Could we imagine a Corbyn, with a new loyal party, succeeding in an age where fewer and fewer people pay attention to traditional media?
One bright spot at least is the painfully slow re-building of unions that we see for example in the US.
Yanis Varoufakis is particularly gloomy about UK’s Labour: https://www.youtube.com/watch?v=w6H6tvVuGgo
The documentary about him looks interesting (for purchase only).
https://www.eyeofthestorm.info
Bill McKibben
https://podcasts.apple.com/au/podcast/the-great-simplification-with-nate-hagens/id1604218333?i=1000639213320
Thanks for the link.
A great example of seeing the big picture.
Reminds me that we never covered anything remotely like that in school in the 50’s.