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Comment by socialist_coder | Hacker News Reader

This is neoliberalism at work. Bernie Sanders challenges this, while Obama and Hillary seek to preserve it.

Any chance at changing this in the 2016 election is dead. 4 or 8 more years of this and it's only going to get worse.

My only hope is that a strong progressive movement can take off before the right wing Nationalists make it into power.

The past few decades of globalization have resulted in the greatest destruction of poverty in history. For every person experiencing stagnation in the developed world, ten people in the developing world have experienced double digit growth. Poverty destruction has massive benefits, and not only for those in poverty. Even from a purely self-interested point of view, developing nations are already seeing exports to developing markets rise, and that will only continue.

Rising a country out of poverty is close to zero sum. When they rise out, those incomes are coming from people in developed countries.

When many millions of people go from being subsistence farmers to producing a massive amount of manufactured goods on the planet, how could you possibly come to the conclusion that it is a zero sum game?

Because many of the people in the developed world who used to be doing that manufacturing are now out of work. Unfortunately, at least here in the US, we've been pretty bad at retraining and helping those who get laid off because factories moved overseas.

>Rising a country out of poverty is close to zero sum

This is obviously false. When a poor country becomes developed, the net productive capacity of humanity increases.

In a completely undeveloped ecoonomy, there is no money to be made domestically. It is all coming from producing for advanced economies. One of the biggest fallacies in current times is that of a growing pie. People in the United States are starting to catch on as the middle class vanishes.

I think the "elephan curve" described above contradicts your point. We see 80% growth near the bottom of the world income distribution, and ~0% growth at the worst point for the American/ developed world middle class. If it was zero sum, there would have to be some negative growth somewhere.

The whole world is lifting itself into wealth, despite the hand-wringing of pessimists. It's awesome!

> every person experiencing stagnation in the developed world, ten people in the developing world have experienced double digit growth.

As the article speaks of half a billion people experiencing stagnation, that would make ~5 billion people experiencing double-digit growth.

I've heard the general claim of reduced poverty pretty often, but I'd be (genuinely) curious to see sources of it. It seems strange in light of the current migratory movements from "developing" into "developed" countries: As in, if poverty has been reduced by such a tremendous amount, why are so many people ready to risk their life to get to europe instead of taking part in the booming economy at home?

It's a big world. India and Syria can exist simultaneously.

Not that I disagree with you, but what would you say to "Joe Middle America" and all like Joe who are seeing their middle class lifestyle evaporate alongside this reduction in poverty? Welcome to being upper-lower class?

To see it as an investment, and also an act of self-interest. Getting basic health care to billions lowers the risk of new plagues. Improving their quality of life lowers discontent and the risk of more and larger wars. Establishing a basic standard of education does more than all the rest, adding billions of voices to the global conversation and inventions that benefit everyone. You can't sell tertiary services to people subsisting on $1/day. The situation had to be addressed, the pain is real, but we will all be better off.

The "investment" would be in plague prevention, foreign education, and potential war prevention? So that tertiary services can be sold by members of the upper class to citizens of the developing world? This seems like the sort of argument that strengthens Joe Middle America's nationalist sentiment, not alleviates it.

Plagues and wars don't respect national boundaries. Joe Middle America knows that it's his sons and daughters that would be on the front lines in a large war. Foreign education alleviates the environment of ignorance that allows fundamentalism and extremism to thrive, and also lowers population growth rates that threaten a wide variety of problems. Joe Middle America is almost certainly employed by an organization that provides tertiary services, or else high tech manufacturing that, again, requires wealthy, educated buyers.

I'm not saying it's an easy sell. The mood in the developed world is definitely protectionist.

None of those things immediately impact the number of dollars in his bank account, or his ability to move upward in the economy moving forward, so Joe doesn't care. "Joe, I know all of your anecdotal experience says quality of life has been declining for you and everyone you know since the 70's, but just go with it a little bit longer and it'll be ok. Check out this chart of global income levels. And this one of happiness in America. See, life is better. Just not for you."

Unfortunately Joe and Jane Middle-America don't care about the far-off billions they have never met. They care about their hometown, that is descending into a post-industrial ghost-town because the local manufacturing was undercut by the almost-free labor of those far-off billions, or their friends and family that are losing their financial independence, or spiraling into depression, suicide, or opioid abuse.

It's not looking like a good deal to Joe and Jane.

It seams to me as period of 50s to 90s contributed as a blip. Yeah, the American middle class doing artificially well. Europe was still rebuilding from WW2. The Soviet Union wasn't really a match (despite the pretenses). Rest of the wold with filled with poor counties with terrible with repressive regimes.

At the time the US had a liberal business climate compared to other parts of the world. As a result a lot of industry was created and exported via culture.

What's happened since is that rest of the world caught up. Europe is no longer rebuilding. Soviet Union fell apart freeing a lot of nation states to purse western ideals. In Asian countries the regimes got softer and also liveried their economies. So there's a lot more competition. Globalization became possible and practical.

In the US life expectancy went up (medication and not smoking) so that made generous defined benefit programs a lot less practical. Women and African Americans can now do a lot of the jobs that were reserved for white middle class males.

All of these things contributed to white middle class American males losing out compare to what they had before. Baby boomers and before just happened to be in the right place / right time.

>The past few decades of globalization have resulted in the greatest destruction of poverty in history.

At the same time there are still more poor people than ever before in history, ~3 billion, so what is the net? 50 years ago there was only ~3 billion people on the planet.

There's no doubt that population growth is one of the defining features of the world economy. But improving average wealth and education inevitably lowers population growth. Population growth must slow to allow further advances in poverty reduction, but I think everyone understands that population growth will slow one way or another. The question is whether it will happen through economic growth or through the four horsemen.

New pet peeve: I wish people would identify which specific aspect of "neoliberalism" is responsible for whatever problems they blame on it. For instance, I've seen it used to refer to both free market policies and rent-seeking by dominant industries. Even though both policies conceivably benefit wealthy elites at the expense of others, they're not really ideologically consistent with each other. It'd be helpful to define our terms here. Otherwise, it's hard to distinguish from general angst about "the system" and "the man".

The 'free market' aspect is often purely ideological and used as an excuse for privatization and cutting spending/austerity, which leads to the rent-seeking and stagnation.

It's a meaningless buzzword, much like "neocon" was during the 2000s.

Both have actual definitions, but are never used appropriately.

What I mean by neoliberalism is summarized here in this paper, "Neoliberalism: Oversold?"

http://www.imf.org/external/pubs/ft/fandd/2016/06/pdf/ostry....

If you think neoliberalism means something different, please let me know. I would love to hear it. I agree that it has buzzword potential, but I believe it corresponds to a pretty specific set of government and economic policies, basically what the UK and US have right now. Germany and the Nordic countries are less neoliberal since they have stronger social safety nets, stronger workers rights, and less "free market" (imo, the good aspects of the free market while removing some of the bad).

Yes. See also "fascist", which has become a general term of abuse meaning "any politician I don't like".

How, precisely, does increased economic friction in the form of more taxes encourage economic growth? I am strongly anti-nationalist, but I must say their economic track record is exemplary compared to the socialists. Venezuelan food riots, anyone?

> I must say their economic track record is exemplary compared to the socialists. Venezuelan food riots, anyone?

Socialism != Democratic Socialism. Venezuela is not the model Bernie Sanders and his supporters wants to emulate. The Nordic countries, and to some extent Germany, are good examples of Democratic Socialism.

Stronger social safety nets, free / nearly free health care and higher education, high minimum wage. Paid for by taxing corporations and the wealthy.

We also see that increased incomes from the wealthy and corporations are not flowing back into the economy. The wealthy are saving their money, not spending it. Corporations are doing stock buybacks and paying out dividends, not expanding their workforce or increasing wages. This is the failure of neoliberalism. It worked great in the past, but now it isn't. It's time for a change.

Germany has excruciatingly expensive health care compared to the UK and the NHS. Definitely not free or anywhere nearly free.

That is why I said, "and to some extent, Germany".

Also, German health care might be expensive but it's always affordable since it scales with your income. It's also still cheaper than the US.

Source: I live in Germany and pay the maximum for my health care, which is around $900 US a month. This covers my entire family, and there are practically 0 co-pays, deductibles, or arguing with the insurance company. Before that, while I was boot strapping my startup and making 0 money, my health insurance was super super cheap.

"I know that some people in the US associate the Nordic model with some sort of socialism. Therefore I would like to make one thing clear. Denmark is far from a socialist planned economy. Denmark is a market economy."

-PM Rasmussen, in response to American socialists incorrectly claiming that they were trying to emulate the Nordic model.

I'd also like to note that (probably as a result of their relatively high tax rate) the Nordic countries are not economic powerhouses. Places like Hong Kong or Switzerland, with relatively free markets and low taxes, are.

My apologies, even I was confused at the terminology. Social Democracy vs Democratic Socialism.

https://en.wikipedia.org/wiki/Social_democracy <-- The Nordic model. This what I would argue for, and when people say they want to emulate the Nordic model, this is what they mean. It's 100% a market economy, no one is advocating for a socialist planned economy.

Regarding economic powerhouses, do we really need to make that the goal? Quality of life and sustainability should be the primary goal, not corporate growth and profits.

Sanders' policies would throw any of the Nordic economies into depression and would bankrupt the state if put into practice there.

What people fail to understand is that the Swedish model of social democratic capitalism isn't antagonistic to large corporations; it's a model where state and corporations form a symbiotic relationship. This at the expense of SMBs and the civil society.

> What people fail to understand is that the Swedish model of social democratic capitalism isn't antagonistic to large corporations; it's a model where state and corporations form a symbiotic relationship. This at the expense of SMBs and the civil society.

I don't think anyone who seriously follows US politics or economics fails to understand that. Bernie Sanders is not pushing to get rid of the free market.

I would love to know more about what you mean when you say it comes "at the expense of SMBs and the civil society"?

From my perspective, here in Germany, having a small business is a bit easier because you do not have to cover health insurance for yourself (your health insurance scales with your income so it will always be affordable) or any of your employees. Of course, the stronger rights of the worker can bite you since it is very difficult to actually fire someone. I know a lot of people who are self employed contractors (filling some small niche), not even making that much money, but still having excellent health care and a high quality of life. That type of thing is much harder in the US since there is no safety net to fall back on and you will be crushed by health care costs.

Edit: I meant Social Democracy, not Democratic Socialism.

https://en.wikipedia.org/wiki/Social_democracy

"Venezuela is not the model Bernie Sanders and his supporters wants to emulate. "

"No True Scotsman".

It's not so much neoliberalism as economic reality. If you're going to trade with other countries you have to deal with labor arbitrage. "Challenging" that with a bigger state doesn't even address the problem, let alone solve it.

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