The deep roots of modern resentment
economist.com
economist.com
It's just those who have benefited from this arrangement the most happen to also control the relationships that power mass media, which is then used to undermine alternative solutions as "racist", "sexist" and "evil" with no evidence whatsoever and immediately engage in mob swarming and plebeian intimidation.
For example: Western Liberalism absolutely requires cheap brown people. (And that deep reliance ABSOLUTELY makes supporters of Western liberalism completely racist) If you make cheap brown people as expensive as Western natives, why do you need cheap brown people? And if you have "good-enough" AI, why do you need either?
Please give an alternative proposal.
Watch as "serious economists" lie about:
* All of the jobs that will actually not disappear.
* All of the prices that will actually not rise (by much).
And try really really hard to pretend that:
* Raising the minimum wage doesn't channel profits into the pockets of workers.
What surprises me isn't that they lie. What surprises me is that people continue to believe them.
I don't know how you came to the conclusion of western liberalism being against raising the minimum wage when it's been a core tenet of their platforms for over a decade now.
But to $20 an hour is something neither liberal nor conservative has EVER advocated for as until there is a public uproar for it, both will always side with corporate interests.
That said, your proposition is an alternative solution that I have never heard anyone of actual influence from either side of the political spectrum (outside of Sanders) ever bring up.
PS: Inflation is not really a single number as some but not all things end up costing less to produce over time. In other words, A may get more expensive while B becomes less expensive. Which makes long term inflation calculations more complicated.
The fact that the corporatist extremists ("moderates" like Obama and Clinton) squeeze this kind of idea from the public discourse is exactly what led to declining incomes which in turn is what made people furious enough to vote for Trump.
If you were a landlord managing an apartment building, how much do you charge for a unit? If all of your tenants suddenly make twice as much money as they did, how long before you double their rent?
If a McDonalds needs to pay all of its employees twice as much money, how long before they double their food prices to make up the difference?
I feel like the working poor in this country get a terrible deal in this world - we definitely need to make conditions better. But does raising minimum wage actually do that in the long run? Or does it just increase inflation and destroy any savings the poor might have?
Remember, your tenants are now able to move to gentrified areas, their wages allow that. Some might want to get a mortgage for a house they could not dream of previously. So now your apartments will have to compete with much wider selection of property. You'll raise prices definitely, but not as much as you would think, and you'll spend most of the difference doing renovations and spending on security.
It seems pretty wasteful, though.
* An increase in inflation but nowhere near enough to offset the rise in wages at the lower end.
* An increase in growth as the money multiplier effect kicks in.
* No real change in employment.
* Share prices fall and lowered earnings projections for classes of business that rely on minimum waged labor.
* As a sort of general guide, look at Australia.
>If you were a landlord managing an apartment building, how much do you charge for a unit? If all of your tenants suddenly make twice as much money as they did, how long before you double their rent?
It depends. This does not happen in a vacuum. If there are a lot of apartments coming on the market at the same time rent could stay the same or even go down.
Every business is subject to competition which would moderate the effect of inflation and tons of businesses that manufacture often respond to an increase in demand by raising production rather than prices (e.g. car manufacturing).
If it went up to $20 I'd project something like 4% inflation.
>If a McDonalds needs to pay all of its employees twice as much money, how long before they double their food prices to make up the difference?
If you want to see what happens to McDonalds, look at Australia:
http://uk.businessinsider.com/mcdonalds-in-australia-vs-amer...
They A) raised the prices, B) raise the quality, C) actually kept the big mac price more or less the same, C) are facing competition from nicer restaurants (people have more disposable income and use it in restaurants other than el cheapo mcdonalds).
>I feel like the working poor in this country get a terrible deal in this world - we definitely need to make conditions better. But does raising minimum wage actually do that in the long run?
Yes.
>Or does it just increase inflation and destroy any savings the poor might have?
The poor have debts, not savings. Demand pull inflation caused by increased wages is just about the best possible outcome for them, but it is HORRIBLE for the rich and the rich have a very well oiled propaganda machine. Hence the "why don't you propose solutions" crowd and the downvotes on actual solutions ^^.
appears a bit of a strawman argument. Googling "$20 minimum wage" the only thing on page one is an article explaining the obvious that people would lose jobs if you did. http://www.forbes.com/sites/quora/2013/02/20/why-shouldnt-we...
That is neither obvious nor is it true. It is the opposite of what is observed experimentally. When the effect of minimum wage hikes is measured across state borders employment remains static.
Already there are swaths of jobs that could be done better by machines but currently it's cheaper to hire a "cheap brown person" as the parent post says by outsourcing it. For example, the manufacture of clothing and footwear which currently employs many millions of people worldwide, mostly in SE Asia. As soon as rising wages pass that barrier and companies pony up for the required capital investments these jobs are never coming back.
There will always be more desires for new jobs/tasks that could be done - but the market price for them will be below the minimum wage, so they will happen only as hobbies.
That's a brave and entirely unsourced claim.
Given that this never happened in the past (e.g when almost the entire workforce was automated out of farm work), why are you so confident it will happen in the future?
Welcome to the international system of currency and labor arbitrage, a core prerequisite for any democratic experiment. Democracy has ALWAYS and WILL always require slaves.
I still fail to see your connection:
1: Slaves
2: Democracy
3: ????
4: Profit(?)
Could you explain with links or examples how exactly slavery (or economic peonage, depending on your definition), is required to maintain a democracy?
I agree it appears I'm making this conflation. But
> nobody is pretending that they are:
Is not an honest statement. Any attempt to make cheap brown labor more expensive through legislation (See the Trump protests) or even by IMPROVING their quality of life (See gentrification) is instantly fought off as racist. The powers that be have deeply merged international currency flow with Western liberal morality after the 1940s and use their sacred cows as hostages to stifle any threats to their power.
For the third time, I ask for a specific example. A link. Something. Otherwise I think you are either trolling or positing biased statements that are not backed up by facts.
But the need for unskilled labor has dropped precipitously, while demand for skilled labor has spiked. See, for example, the IT industry's need for "cheap brown people" (from India, Pakistan, and elsewhere in Asia). They're only marginally cheaper than white citizen labor, and a lot more expensive than unskilled labor. This has been offset some by outsourcing, so the labor can have a lower cost of living in their native country, but still.
Brown labor is always, always an act of desperation. A racist society would rather not have brown people at all, and only employs them if whites cannot or will not do the job.
here, the need for unskilled labor has dropped precipitously here
Any job that requires a lot of muscle and not much brain has been more or less wiped out. That's a lot of jobs.
The basics of liberalism as we see it today - rule of law and representative democracy, are young. How many presently-unthinkable violations of liberalism were committed by a Western nation within the lifespan of someone who is 90 today, with full public support? Outright genocide, systematic persecution and disenfranchisement of whole races and genders, violent militarised colonialism, you name it.
Building a just state and society is a slow, delicate, multi-generational project of structural and cultural modification, and we are just at the beginning. We're just now getting to a place where we're moving past barbaric mass violence and mass racist persecution.
It's like people look around, notice that we're not in fact in some enlightened Star Trek utopia, declare the whole edifice rotten, and decide that the best response is to gleefully burn it all down.
Just look at the time when women were granted voting rights (1).
The US, by some seen as the 'holy grail' of modern democracy, officially allowed women to vote in 1919 (ironically many of the Democratic party were opposed), had extensive voter supression such as literacy tests until the 60ies and arguably still does today.
Many European countries were not real Democracies until after WW2, or event until the fall of the soviet union.
60-70, or even 100 years is basically nothing. That's one long lifespan.
Let's see if we see it all go down in flames in our lifetimes. (Probably not. Let's hope not).
You have to appreciate the irony of a `Democrat` filibustering a woman voting rights act.
But that's our current view. Reading press articles from back then when this issue was discussed in many countries in Europe is quite entertaining also.
Add capitalist property relations though too.
This line of argument is also often used to whitewash Communism by saying things along the line of: "Communism would work just fine if it wasn't implemented poorly like the way China or the Soviet Union did."
It's rather troubling that in such a connected and technologically advanced age, we can't seem help ourselves from looking to the past to organize ourselves for the future.
Practiced perfectly, yes, abstinence is 100% effective at preventing pregnancy. There is no question about that.
And yes, some small fraction of people do manage to practice complete abstinence, and reap the benefit of not getting pregnant.
But as a policy, abstinence only for broad swaths of the population is a total disaster.
> some small fraction of people do manage to practice complete abstinence
I actually think it's a pretty large fraction, but they do it out of inability to secure a mate. The people for whom supply and demand curves never cross.
It's much harder to reason why a person capable of having a life will choose to not to.
EDIT: Perhaps a better way of stating this is our desire to package academically useful economic models into grand policy solutions.
You hear plenty of "well, capitalism would work fine too if it were just implemented correctly". That's exactly as stupid.
Capitalism lends itself more towards authoritarianism, in my opinion, as the compound interest function of accumulated wealth works similarly with power. For example, wealthy Republicans support Republican politicians who lower their donors' taxes and entrench their party's power through gerrymandering and voter suppression (such as purged voter rolls, or deliberately understaffed polling places in areas with more opposition party voters).
Between 1917 and 1950 they grew at a staggering pace. From agricultural backwater to first space power. That isn't an economic failure in any way.
After the 1950s they tried to re-gear the economy to producing things like fridges and, of course, for consumer items it wasn't nearly as effective.
In the end the thing that undid the Soviet project was the idealism of its president (Gorbachev) when faced with the results of his authoritarian predecessors. It wasn't really an economic failure.
>by attempting to refine the designs of failed communist states risks going back on the same path
If we attribute Stalin to a failure of communism surely we have to also attribute Hitler to a failure of capitalism?
Or we could accept that both analyses are stupid and shallow.
>Capitalism lends itself more towards authoritarianism
I think economic systems are orthogonal to political systems.
I agree with everything you said but this seems ironically contradictory...
> I think economic systems are orthogonal to political systems.
Not entirely orthogonal. But yeah, HN seems to think communism is inherently authoritarian.
Same goes for terrorism these days. "If you're not with us you're against us," was the phrase I believe Bush the junior liked to tell us.
Likewise, it is predictable that a centrally planned economy would be able to develop industrial goods for industrial needs, but fail at producing consumer goods, which ultimately catalyzed far more economic growth in capitalist countries, both because of the market segmentation that a central plan could not predict or accommodate as well as a free market, and also because the incentives for the creator and access to the means of the production (primarily startup capital) were easier to come by in capitalist economies.
I think your comparison with Hitler is lacking in depth, unless it was meant to be a dig at my comment, which I believe I have rebutted.
I fundamentally disagree with your final statement. The accumulation of physical resources and political power is and will always be intertwined. If you can name one example in all of human history (from agriculturalization onwards), whereupon the political system did not depend on the economic system and the economic system did not depend on the political system, then I will concede my point. Until then, I find your argument lacking.
The idea that some period of authoritarianism is required for Communism is quite a Leninist idea. Sometimes I feel as though Communism would work better as an ideal to strive toward, rather than necessarily something to be acheived. I don't know how others feel on this, though.
What prevents people from banding together to create factories that they then work in, for example?
Thus co-ops will have a tendency to fail within capitalism, because they usually cannot compete sufficiently. In addition, unless everyone worked in co-ops, there would still be worker exploitation, and thus still need for Communism (in the eyes of Socialists). This is especially true in developing countries.
Exploitation happens at a class level, not an individual level, nor the co-op level. It is pervasive.
The problem then(also identified by communists of old..) is that you can't compete with forces outside your control - so you either need a global communist revolution, or you need pretty strict isolationism.
Since you never convinced your consumers that ethical factories are worth supporting, how do you plan to deal with the resentment they feel when they see the wealth foreigners posses achieved through the harsher competition policies of capitalism? Will you be suppressing information and limiting access to the Internet? Maybe some propaganda pieces about how your ethical factories are better than slavery under capitalism?
Maybe the "horror stories" of communism were caused by its flawed leaders more than the ideology itself. But it seems that a lot of stuff that we wouldn't really be happy with needs to happen in order to implement "perfect communism".
Now when you say "must optimize on two fronts: money in order to keep itself afloat and" ... that first one is NOT optional. If that first one is not a prerequisite to having the factory than that factory (or company, or ...) is a net loss for the economy, society, for the world as a whole. You seem to imply it is tenable for a society to have most or all companies operate under such conditions, and of course it is not.
That is of course the alleged problem with communism. Profit in itself is not a necessity, but having profit >=0 over the long run IS a necessity (but obviously for company stability having a decent positive profit most years is very much not optional, and any exceptions must be made for investment purposes, not for any other reason). Otherwise, colloquially, you're "eating your seed grain".
That is the problem, right there. Communist economists see communism as a system that can work because people would still generate profit. People, even communist activists themselves, see communism as a system that can deny the real world. And under those circumstances, of course communism fails. Under a communist system as understood in economics departments, profit would still be an existential necessity for any company.
So if avoiding profit and "instead get X" is why you're a communist, stop right there. That's not communism, that's fantasy. No matter what X is. Stop defending anything remotely like that as an advantage of a communist system, because it is not. The real world need for more valuable output than input from any long-term process, applies just as much to communism as to capitalism, mercantilism, ...
No. Monetary value is not perfect measure of utility, because market demand is weighted by wealth.
A luxury yacht for one individual clearly provides nowhere near as much utility to them as an equivalently priced quantity of food would provide to a bunch of homeless people, but the market prices it as such because the individual is richer. If we could magically swap the yacht for the food, everything else being the same, society would be better off as a result.
We allow this inequality of demand because it is what drives the supply side towards efficiency, and for the most part I think this is a reasonable compromise.
But we should not confuse profit with utility.
Firstly profits of 5% of revenue are considered high, on average. That's what that yacht is paid out of, and that means that feeding many homeless with it wouldn't work in practice.
Second luxury articles provide firms with the rewards of motivation of their employees. Everyone in Silicon Valley keeps reminding us how that's the lifeblood of every company, and while I disagree with that, it's obviously useful, both to that firm and to society. So the yacht has more utility than you give it credit for.
Well I'm not using a well defined measure of utility here, but I thought it was fairly non-controversial to say that, at least in immediate terms, food for many people creates more utility than a yacht for one person.
That they're homeless isn't the point, and I should have left out that rehetoric. The point is just that they're less able to demand the food than the rich person is the yacht, despite it providing them more utility.
> luxury articles provide firms with the rewards of motivation
Yes, I said that. Inequality is what drives the supply side, and I agree that this may lead to better outcomes overall, but my point is that it complicates the process, and detaches money from being a raw measure of utility.
The possibility of a yacht may encourage someone to produce food more efficiently, but this is a lot harder to measure. Maybe the level of inequality doesn't matter that much as long as people perceive higher social status? Maybe the inequality reduces opportunities for many potential innovators, destroying more efficiency than it encourages? Or maybe the lack of security discourages people from taking risks even if they have opportunities?
I'm not asserting any of these ideas, just pointing out factors that confound measuring the utility created by inequality.
In general I am dismal at the ability for overthrow to enact lasting change. It often descends into a brutal struggle to keep newfound power, which becomes more important than the ideals themselves. The American Revolution ("All men are created equal") failed to end slavery, among other shortcomings. The French Revolution was a bloody mess that was only pacified by dictatorship and monarchy. Haiti, most tragic of all, was the only successful slave rebellion and they've been paying for it ever since, both as a result of foreign meddling as well as by greed and power-lust from their own leaders.
I wonder about those. I have this thought on the back of my head - now that we have ubiquitous light-speed communication and a big surplus of computing power, couldn't doing central planning via algorithms and automated systems offset some of the "inherent limitations" you mention?
(Honest question, I'm not advocating for communist revolution or anything; just looking for viable alternatives to organizing economy by recursive zero-sum games.)
I would guess that current AI tech is many orders of magnitude away, competency-wise, from being able to improve on the efficiency and agility of loosely connected networks of generally autonomous humans.
Even so, ignoring such technical limitations, the issues of control and individual agency are incredibly thorny. How are preferences aggregated? And how does a completely centralized system continually update itself to best serve all participants? Perhaps the competing AI systems can campaign every 4 years :)
Perhaps some sort of AI-human hybrid governmental system could offer a more modest path forwards. We are arguably already beginning to take first steps in that direction.
The choice to depict, say, Sanders' proposals as unrealistic by straw manning them was a deliberate political attack:
http://www.thefiscaltimes.com/Columns/2016/01/22/What-Libera...
Unfortunately the average Democrat primary voter didn't dig into the substance of the attack well enough to realize that it was essentially bullshit. They simply believed Krugman's lies.
The voters wanted a change from the status quo.
And that is why Trump is now your president.
A similar dynamic is now occurring in the UK. Corbyn's ideas (e.g. rail nationalization/pay caps) are routinely depicted as unrealistic. If people continue to believe those lies, the far right will be seen instead as the 'viable' alternative.
The same kinds of economists who declare pay caps unrealistic and are weirdly enough absolutely blind to unsustainable build ups of debt causing financial crises but pretend that magic robots are about to put 80% of us out of work in the next ten years. That's "realistic" I suppose.
[1] https://en.wikipedia.org/wiki/British_Rail [2] https://en.wikipedia.org/wiki/Railtrack [3] https://en.wikipedia.org/wiki/Network_Rail
Of course, I don't think people want to return to the period just before privatization either when the rail network was deliberately starved of investment in order to make privatization appear more appealing.
Nonetheless, the majority of the public support this idea. The Telegraph literally called the majority of the public communists for doing so.
The alternative to a campaign of drone warfare is to not do the campaign.
The alternative to regime change and overthrow of democratically elected governments is to treat the nation as a sovereign nation, and not overthrow their government.
The alternative to concentrated wealth and monopolists is to split up the monopoly, and make do with smaller 'less efficient' companies.
Classical liberalism was synonymous with libertarianism, minarchy, etc.
The modern colloquial usage is closer to meaning left-wing statism (as distinguished from 'conservative' or right-wing statism).
"In today's news, Person A has made a sizable, significant contribution of Something to help Subset B of The Overwhelming Problem. But, one has to ask: What about The Rest of The Overwhelming Problem? Why doesn't Person A care about any of that!?"
The issue is that you provided the media with a headline they need, but not one they want. You gave them "Things are getting better, but it's complicated". But, what readers respond to is one of "15 reasons you should be afraid, here's who to blame" or "Everything is magically fixed in a single soundbite".
https://blog.jaibot.com/the-copenhagen-interpretation-of-eth...
"The Copenhagen Interpretation of Ethics says that when you observe or interact with a problem in any way, you can be blamed for it. At the very least, you are to blame for not doing more. Even if you don’t make the problem worse, even if you make it slightly better, the ethical burden of the problem falls on you as soon as you observe it. In particular, if you interact with a problem and benefit from it, you are a complete monster."
Latin America is painfully emerging from an age of populism fed by resentment (e.g.: Kirchner in Argentina, PT/Lula in Brazil, Chavismo in Venezuela). The economic policies being proposed by Trump (protectionism, discretionary subsidies for corporations, big spending...) are precisely the main cause of our misery.
The fact that the developed world is flirting with the disaster we are trying to fix is astonishing.
https://chomsky.info/secrets03/
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About half of what are called US exports to Mexico are intrafirm transfers of this sort. They don’t enter the Mexican market, and there’s no meaningful sense in which they’re exports to Mexico. Still, that’s called "trade."
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This interview by Sanders on Vox is also very illustrative:
https://www.youtube.com/watch?v=S5vOKKMipSA&t=352
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Bernie Sanders: Open borders? No, that's a Koch brothers proposal. Ezra Klein: Really? Bernie Sanders: Of course. That's a right-wing proposal, which says essentially there is no United States. ...
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It is sad really. People keep calling those who voted and promoted Hillary "the left" but there is not much "left" left in there. Trump apparently took the traditional bread-and-butter leftist issues NAFTA and jobs and ran with it. Whether he cares for those things or not, at least he picked them up. So the Democrats ended up with identity politics, mixed with corporatism. They are trying to appeal to Occupy Wall St. and also give $200k speeches to Wall St., they are for gay rights but also take donations from states which throw gays off of buildings. It was rather upsetting when during the nightclub shooting in Orlando, Hillary's campaign and the rest of the media moved quickly to suppress the news because it involved a what apparently an Islamic Terrorist attack. I know a few gay people who never quite got over that and never forgot it...
Moreover on identity politics and the left. Has Marx never wrote anything about labeling groups correctly so they don't get offended? It was always about being very offended, specifically offending the ownership class and not just offending them, but annihilating them.
Maybe one good thing about Trump winning is that it cleared the table for creation of a new political party. A more authentic left party. Those people who followed Sanders what happened to them? There such tremendous energy there. Is it wasted on boycotting Uber, and re-tweeting the same things over and over... I am afraid it is.
But memories fade quickly...
Then again, Trump's positions are really not so representative of the establishment republicans.
But, even so, the left and right opposition to neoliberal trade is not the same (the opponents on the left tends to favor trade, but oppose trade without common labor and environmental protections, those on the right tend to oppose both trade and labor and environmental protections.)
Similarly, while almost everyone opposes "open borders" (an idea with narrow support which is mostly heard as a right-wing label for any immigration that they oppose), the left and right tend to be very far apart on what they prefer as the direction of change from status quo immigration policies.
This is a new thing in history. Prior to the Industrial Revolution, there were more smart people than jobs for them. Strength and robustness were more valued than brainpower. That lasted well into the 20th century.
The big change started during WWII. For the first time, war started to become more technical and bureaucratic than macho. There had always been some military heavy thinkers, but only a few were needed, at command and general staff level. In WWII, there were a lot more people turning knobs, reading dials, making calculations, and writing plans, and they were moving up in authority.
Post-WWII, there was enough work for everybody for a while. But automation and mechanization were starting to be widely deployed. A milestone was reached in 1974, when auto companies in Detroit started requiring a high school diploma for new hires. Until then, they'd hire anyone who could tighten a bolt, and paid well enough that employees could afford a house, car, and family.
1974 was the peak year for the American working class. It's been a slow downhill slide since then for people with high school diplomas and less.
This was all before computers were widely available. Computers accelerated this process, but more than that, they broadened it. Detroit was highly automated by the 1970s. Now almost every business can be. Businesses that couldn't keep up went under. The US is full of abandoned factories in small towns and cities.
This has taken away the support system which provided stability, and prosperity in the developed world. That's where Trump voters came from. The system betrayed them. Of course they're angry.
I'm not saying we're doing everything right, I'm just saying it's amazing that we're able to do it at all.
To start to fix some of these issues in the Western System, one of the first steps that is required to take is to only allow all company and trust entity shares and interests to be owned SOLEY by REAL PERSONS, and all such owenership should be public knowledge.
> Ceaseless change gave birth to liberalism, which, for all the mistakes made in its name, continues to adapt. Despite those mistakes, it remains the best response today.
I mean, seriously? That's proof by assertion.
"..in Iraq and Syria, where what used to be called the civilising hand has proven incapable of stemming the bloodshed."
I read it for the data (in this case the stated facts about the book being reviewed) and try to filter out the editorializing.
It's odd, but when you think about systems vs single solutions, liberals like to think of the "systemic solution" so it doesn't happen again. A Factory explodes? Regulation is the answer. A baby is switched at birth? We need much more complicated computer systems to track babies. etc...
Conservatives are more like, oh shit, that WONT happen again, we promise. And likely it doesn't or rarely does.
I'm not really arguing which of these routes is better here, but I see more and more that these opposite ways of thinking is the crux of our anti-trusting of the other side. I think the only way they will is if we, as a people, try to sit in each other's shoes more.
What's funny as an interesting parable, I see the liberal route of making rules (to save lives, stop mis-matched babies) as procedural/imperative programming.
The conservative route of simply fixing the problems that went wrong as a social fix as a machine learning.