If I remember correctly, someplace in _Capital_ there is a footnote (I believe by Engels) that defines "vulgar economists" and lists there functions, apologetics being the core. Things have not improved since then have they?
Carrol -----Original Message----- From: [email protected] [mailto:[email protected]] On Behalf Of Jim Devine Sent: Saturday, December 17, 2011 10:46 AM To: Progressive Economics Subject: Re: [Pen-l] David Morris skewers Mankiw from David Morris: > Consider the issue of inequality. We economists can try to estimate the cost of redistributionthat is, the negative impact on efficiency that comes with attempts to achieve more equality,writes Mankiw [my alleged guru]. But in the end, picking the best point on the tradeoff between efficiency and equality comes from policy preferences about which we, as economist must be agnostic.< -- It's truly galling that idiots like Mankiw refer to "we economists" as having a unified view. It's a version of the royal we. Those who consider themselves to be the royalty of the NC school (Mankiw, Feldstein, et al.) claim to speak for all economists as if there are no disagreements with NC economics from other economists or even _within_ NC economics. (For example, Krugman and Stiglitz are what I'd call NC economists and they'd disagree heartily with the views of Mankiw or Feldstein on many issues (including perhaps even those of method). Of course, those of the Chicago school don't consider Krugman or Stiglitz to be economists.) -- So these folks "can try to estimate the cost of redistribution." It's important to note what _kind_ of "redistribution" he's talking about (and worries about), i.e., redistribution from the top 1% (or their poorer allies of the top 5%) to the rest of us, likely as the result of some government policy. He's not talking about the real-world redistribution from the vast majority to the ultra-rich that has occurred since 1979 or so. As far as I can tell, Mankiw has no idea why the distribution of wealth and income has shifted so radically to the right in recent decades: in standard NC economics, the distribution of wealth is taken as "given," i.e., unexplained. It's very clear that he doesn't see the wealth shift as a problem. The NC school -- especially the right-wing version pushed by the Mankiw types (which might represent a majority of professional economists) -- has a world view that was likely first articulated by John Locke: any change in the distribution of income and wealth that is due to government policy is called "redistribution." On the other hand, any change in the distribution of income and wealth that is due to the workings of the so-called private sector ("civil society"?) are not thought of as "redistribution" but instead a "natural" (so that there's no call for NC economists to estimate its cost). Following Locke, one's individually-owned property is "natural," but the government is artificial and at best a necessary evil (even though the former could not exist without the latter). The world outside of government is presumed to approximate the "perfect market" (which produces "natural" results such as the "natural" rate of unemployment and "efficiency") except to the extent that outside agitators -- the government -- mess it up. The unfettered market is what's needed! Given the preexisting distribution of wealth and income, the free market serves consumers to the greatest possible extent! four legs good, two legs bad! In his CAPITAL, Marx limned a completely different story of how an unfettered market works. Unlike the NC vision, the distribution of wealth is a "dependent variable" to be explained rather than to be taken for granted. In his absolute general law of capitalist accumulation, as I posted recently, those who own capital are able to use the surplus-value they reap to accumulate more yet capital -- which allows them to reap more surplus-value, etc., as part of a vicious circle; this is backed by the normal tendency of capitalism to create and re-create unemployment while deskilling workers. Nowadays, of course, the capitalists also use their government to aid their accumulation of capital and power. Their lobbyists buy favors from the government, which supinely provides them at rock-bottom cost. -- In this NC view, there are benefits to "redistribution" (a higher standard of living for Harvard janitors, etc.) and there are costs (the alleged loss of efficiency because the world is presumed to be efficient absent this kind of "redistribution"). How can economists balance these? To Mankiw, "we, as [right-wing NC] economists must be agnostic. In the standard NC view, the job of economists is to present the existing trade-offs (e.g., "equity" vs. "efficiency" which translates to "economic equality" vs. "what's good for those with money") to the voters -- represented by the government. Then, the voters decide what part of the trade-off is advantageous. As at a diner, "Marge" (the government) hands us a menu that the economists have printed. Then we say "Marge, we'll take a little more equity and pay for it with a little loss of efficiency." Then the short-order cook whips up the dish (using recipes written by economists) and we pay for it. Mankiw is "agnostic" about the results of this voluntary transaction. It's a matter of our choice, since we're the sovereign consumers and voters. But he totally ignores the reality of politics. Given the nature of a capitalist system (and reinforced by the rightward wealth-shift since 1979 or so and the accompanying decline of the opposition), concerning economic issues the government most represents those with those with the most wealth. It's more like the picture presented in Pohl and Kornbluth's 1952 _The Space Merchants_ in which corporations, not real people, are represented in Congress ("we'll fight this suit all the way up to the Chamber of Commerce!") One dollar one vote! In that case, the diner is shunned. Instead, the dollar-voters go to the fancy gourmet restaurant. The waiter, Gregoire, hands them a menu of equity vs. efficiency. Even though it's hard to see it in the candle light, the patrons choose. "We'll take a maximum of 'efficiency' (what's good for those with money) and what do we care about so-called 'equity' (sneer intended)? if we have extra cake at the end of the meal, the unwashed masses can have some. Just don't let them know that we're here." -- Jim Devine / "In an ugly and unhappy world the richest man can purchase nothing but ugliness and unhappiness." -- George Bernard Shaw _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
