All posts filed under: Economics

What Comes After Capitalism?

A review of Capitalism, Alone: The Future of the System That Rules the World, by Branko Milanovic, Belknap Press: An Imprint of Harvard University Press (September 24, 2019), 304 pages “The domination of capitalism as the best, or rather the only, way to organize production and distribution seems absolute,” writes Branko Milanovic in his new book, Capitalism, Alone: The Future of the System That Rules the World. With feudal systems demolished, and the ideological battles between fascism and communism resolved, a clear winner has emerged. Capitalism is unrivaled in its ability to produce material abundance and coordinate the use of scarce resources. But above and beyond that functional success, capitalist societies also inculcate a set of commercial values that reinforce its supremacy and reward its expansion into new spheres of life. If capitalism contains the seeds of its own destruction, as Marx thought, such forces are overwhelmed by its propensity to spread and self-replicate—at least so far. As a leading scholar on income inequality at the City University of New York, Milanovic is sensitive to …

Rich Like Me: How Assortative Mating Is Driving Income Inequality

It may be useful to open this topic with an anecdote. Some ten years ago, I found myself in an after-dinner conversation, lubricated by wine, with an American who had been educated at an Ivy League college and was then teaching in Europe. As our conversation drifted toward matters of life, marriage and children, I was initially surprised by his statement that whoever he had married, the outcome in terms of where they lived, what type of house they owned, what kind of holidays and entertainment they would enjoy, and even what colleges their children would attend would be practically the same. His reasoning was as follows: “When I went to [Ivy League institution], I knew that I would marry a woman I met there. Women also knew the same thing. We all knew that our pool of desirable marriage candidates would never be as vast again. And then whomever I married would be a specimen of the same genre: They were all well-educated, smart women who came from the same social class, read the …

China’s Looming Class Struggle

Westerners tend to identify China’s coming political crisis with developments such as the brave, educated, and often English-speaking protests in Hong Kong. Although they undoubtably pose an annoyance to Xi Jinping’s regime, the real existential challenge to the regime derives not from China’s middle orders but from the very classes that gave birth to the Communist regime. As someone who has been to China many times over the last 40 years, I acknowledge that the achievements of the reformed socialist regime are nothing short of astounding. Beijing’s streets, once crowded with horse-drawn carts, rickety bicycles, and people dressed in ragged Mao jackets, now accommodate Audis, shopping malls, and slickly attired hipsters. Urban Chinese are no longer so impressed by New York or even Tokyo; their country is home to five of the tallest buildings in the world. Yet this remarkable growth has come at the expense of China’s supposedly egalitarian ethos. Since 1978 the country’s GINI ratings—a system that measures inequality—have gone from highly egalitarian to more unequal than Mexico, Brazil, and Kenya, as well …

Against Research Ethics Committees

Author Note: This article is based on a presentation at the Economic Society of Australia Annual Conference, and draws on an earlier discussion of an incident with an Australian university ethics committee “Why Ethics Committees Are Unethical” Agenda 10/2 2002.  The views expressed here are personal, and should not be attributed to the organisations with which I am affiliated.  Ethics committees have been part of the life of medical researchers for some decades, based on guidelines which flow from the World Medical Association’s 1964 “Declaration of Helsinki.”  This declaration was aimed at physicians and draws heavily on the Nuremberg Code developed during the trials of Nazi doctors after WWII. It has been joined by more recent guidelines such as the World Health Organization’s (WHO) “International Ethical Guidelines for Biomedical Research Involving Human Subjects” and many others. In Australia, the National Health and Medical Research Council (NHMRC) issued its first Statement on Human Experimentation in 1966, and the current set of NHMRC guidelines, now issued jointly with the Australian Research Council (ARC) is the National Statement …

Corporate Subservience to China Exposes the Hypocrisy of Woke Capitalism

China’s suppression of political dissent within its borders is old news. But more recently, the Chinese government has managed to project its power across the world—and even into the heart of an iconic American business sector: professional basketball. The saga began when Houston Rockets General Manager Daryl Morey—a well-known figure within the National Basketball Association (NBA)—Tweeted support for ongoing pro-democracy protests in Hong Kong. The Chinese consulate in Houston signaled its displeasure, with a statement indicating that it had “lodged representations and expressed strong dissatisfaction with the Houston Rockets, and urged the latter to correct the error and take immediate concrete measures to eliminate the adverse impact.” Morey seemed to receive the message. He hastily deleted his Tweet. But the NBA—which is the most popular sports league in China—paid a price anyway. A series of NBA events in China were abruptly canceled, and a number of firms suspended co-operation with the Rockets. Two days following Morey’s Tweet, the NBA released an official statement distancing itself from the Rockets GM, lamenting that Morey’s pro-democracy statement has …

Good Men Aren’t Getting Harder to Find

In a recent editorial, Wall Street Journal editor at large Gerard Baker noted that the share of female college graduates has risen to 57 percent, and posited that the disproportionate number of college-educated women is affecting the dating market. Since there are now four female college graduates in their 20s or 30s for every three college-educated males of the same age, and since women prefer not to date men whose status is lower than theirs, there must not be enough men to go around. This hypothesis fits conveniently with a number of narratives, promulgated across the political spectrum from Bernie Sanders to Jordan Peterson, about boys and men falling behind or being abandoned by society. However, on closer examination, the story is a bit more nuanced. Baker makes a mistake common in trend pieces on higher education: He takes a statistic about “college graduates” and draws a conclusion that fails to consider the differences among the huge range of degree-granting institutions in the United States. Every year in the US, nearly 2 million students enroll …

The Politics of Procreation

Throughout most of history, starting a family was a task that most people either aspired to or dutifully performed. Today, that is increasingly not the case—not only in Europe, Japan, Australia, or North America, but in the world’s most economically dynamic region, East Asia. The trend towards post-familialism, a society in which the family and marriage are no longer central to society, will reshape our politics, economy, and society in the decades ahead. Since 1960, the percentage of people living alone in the United States—where the percentage of Americans who are mothers is at its lowest in over three decades—has grown from 10 to 30 percent. Similar phenomena can be observed in virtually all wealthy countries; in Scandinavia 40 percent of the population lives alone. In Britain, the number of single parent households was 8 percent in 1970 but has now passed 25 per cent, while the percentage of children born outside marriage has doubled to 40 percent over the past three decades. Even East Asia is also now seeing the early signs of a …

Life, Liberty, and the Pursuit of….What Exactly?

On June 28, the morning after her eyebrow-raising theatrics at the second Democratic debate, New Age high priestess-cum-presidential aspirant Marianne Williamson retweeted this: The power of your mind is greater than the power of nuclear radiation. Visualize angels dispersing it into nothingness. — Marianne Williamson (@marwilliamson) March 29, 2011 While Williamson’s candidacy is itself certain to disperse into nothingness, legible between the lines of the guru’s flakiness is a profound insight about the most misunderstood and misguided totem in American life: the idea that positive and/or happy thoughts foster positive and/or happy outcomes. The same belief in “mind power” that elicits groans and derision when rendered in 280 characters is woven through the fabric of American life. American culture has evolved a unique view of the mind’s relationship to the external world; not in the sense of an esoteric disquisition on the nature of consciousness, but rather in the sense of spoon-bending—a view of life wherein positive thinking enables us to bend life to our respective desires. Ergo: The attitude is the action. The belief …

Tourist Journalism Versus the Working Class

A few days before the Fourth of July, British comic John Oliver used the pulpit of his US infotainment show, Last Week Tonight, to deliver a lengthy monologue about the depredations of Amazon.com. His specific complaint was that Amazon doesn’t treat its employees very well. According to Oliver, among the indignities that the company has heaped upon its workforce are two separate instances in which a canister of bear repellant leaked in an Amazon warehouse. Oliver and his journalistic team also found former Amazon employees willing to complain on camera about working conditions in the company’s warehouses and fulfillment centers: they can get very hot in the summer and very cold in the winter; getting to the bathrooms sometimes requires a long walk; pregnant women get no special bathroom accommodations. Oliver’s researchers even uncovered an incident in which a worker had died on the job and her co-workers were told to carry on working in the presence of her corpse. Amazon disputes much of this, but I have no difficulty believing that incidents like these do …

The Impressive Record of Theresa May

It’s usually difficult to describe the lasting legacy of a British Prime Minister in one word. For many, Theresa May (2016­­–19) seems to be the exception: failure. She inherited a small Conservative Party majority in the House of Commons and was under no political or constitutional pressure to hold a general election until 2020, but she called one nevertheless in 2017 and ended up losing that majority, forcing her to govern in coalition with the Northern Irish Democratic Unionist Party for the remaining two years of her premiership. Her first attempt to get the House of Commons to approve the Withdrawal Agreement her Government had negotiated with the European Union was rejected by 432 MPs, the largest defeat of any British government in history. She attempted twice more to get the Withdrawal Agreement Bill passed and failed on both occasions, thus making her the self-styled “Brexit Prime Minister” who failed to deliver Brexit. Notwithstanding all this, she was a Prime Minister who presided over several successes which shouldn’t be overlooked. The Economy Just a month …