Sunday, April 29, 2018

tradition: we dream each other's dreams


It was, I believe,  T.S. Eliot who said that every strong writer creates the tradition that he then proceeds to follow. By this he meant that literature is not sequential, even if its chronology, by mundane necessity, is. A writer picks out, from the vantage point of those instincts found in his scribblings, those of his predecessors who tended towards him. Blake thought the same thing - Milton dreamed of Blake, and then Blake dreamed of Milton. Mixing memory and desire indeed. 

Well, the same can be said, as we all know, for economic history. When bubbles are blowing, the historians turn a revisionist eye on previously dissed speculators. In the nineties, there was an outpouring of sympathy for, of all people, J.P. Morgan. So cultured! So right, so often! This acquisitive weasel, this man whose name was rightly cursed by every farmer and Pullman porter in the 1890s, the classic photograph of whom, stick raised, WC Fields proboscis burning, pig like eyes shining with malice and outrage, was muckraking enough. This culminated in Strouse prize winning bio, which gave us a nineties J.P. For Strouse dear Pierpont turns out to be less ogre than Clinton Democrat avant la letter, managing us into the tiered prosperity we so knew and loved during those boomiest years. 

Economic history is, at the moment, turning a more puzzled eye on 90s verities. Or some economists are. For instance, it was proven as a fact by 90s economists that globalization, free trade for all, was our ticket to utopia. If any of the Morlocks became discontented or dis-employed, during this time, it was all due to technology. And you can’t say anything bad about technology! It just requires smart smart smart smarts – people like, say, degreed economists. Since then the Morlocks have got poorer, they’ve lost social status, they are in debt, and instead of blaming themselves for not having sold Grandma and gone to Harvard, they are blaming their rulers. This is called populism, and man is it bad! First they came for the billionaires, and soon they are against gay marriage. This, at least, is how decent centrists, who want, really want to help the Morlocks but just don’t have time at the moment, see it.

Adrian Wood has a gentle piece in VoxEU wondering whether perhaps, perhaps those economists who cheerled us into the trade pact globe of today were being premature, or even uncaring about the Morlocks. Maybe globalization did have a little bit to do with job loss, wage stagnation, and downward shifting tendencies among those who don’t have personal bankers. It is written in a nice, gingerly manner, all soft voiced, which makes for some unintentional comedy. For instance, Wood notices how much weight was put on  
Heckscher-Ohlin trade theory to show that offshoring manufacturing to cheaper labor oasis wouldn’t touch a hair on the chinny chin chin of the Morlock class. And he comments:

“In hindsight, researchers were blinkered by HO theory. Not enough attention was paid to other mechanisms by which trade might affect wages. HO also assumes that  labour mobility within countries is costless, and this unfortunately caused economists to forget that particular localities often bear most of the social costs of expansion of trade.”
Oh, those Morlocks! They just won’t pick up in their masses, abandon their homes where they grew up and where their parents grew up, and move to where the work is! My gosh, no wonder they take to opioids! Which isn’t to say anything bad about how wonderfully profitable the Sackler family has made Purdue Pharmaceuticals – wonderful people, and so artistic too!
Centrism is, by all accounts, losing its grip on everything but the media and governing class elite. Centrism is the very dream of the economics department. They don’t get everything like they want it – wouldn’t it be nice to privatize the streets in cities and such – but they get good compromises that inflict fatal wounds on the social insurance compacts that formed in the 30s and held up through the 90s. And now nobody likes it!
Time, I think, for tradition to jump the tracks. Let’s go back to the progressive economists of 1900, a much sounder lot.

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