Posts Tagged ‘Global Financial Crisis’

Commentary round-up

Wednesday, September 8th, 2010

Colun James’s columns this week have a distinct focus upon the Labour opposition. His Fairfax paper column is Making a start on remaking Labour, which sets out to describe some of their emerging new thinking:

In David Cunliffe’s words, it means shifting from “politics for” to “politics with”. The problem with “politics for”, 38-year-old first-term MP Grant Robertson says, is that “for most people, politics is something that is done to them. So they disengage.”

James also sketches a new ‘economic revisionism’, “influenced by post-crash international commentary by the likes of Robert Reich, Joseph Stiglitz, Paul Krugman, Robert Skidelsky, Dani Rodrik and Tony Judt plus Olivier Blanchard of the International Monetary Fund and Martin Wolf of the Financial Times”:

The emerging policy frame is said to be “internationalist and outward-looking”, concerned with economic sovereignty but not protectionist. It will aim for an economy which is “clean, green and clever”, not just an appendage of Australia, with an emphasis on saving (“a crucial issue” canvassed by Cunliffe in a recent speech) and innovation, where Labour stalled in the 2000s. The state will be “highly active but not necessarily bigger”. Goff and David Cunliffe have been musing on changes in tax and monetary policy.

Then, in his Otago Daily Times column Children-centred policy, James looks at developments in the party’s social policy:

Labour has also changed tack on how to address the fundamentals of opportunity. Deputy leader and social policy spokesperson Annette King consulted a “commission” of outsiders, some not people normally in the Labour, or any, party camp.

The result, to be presented to Labour’s conference next month, is a focus on children. The aim is to move from developing policy by way of separate adjustments to the various branches of social policy to devising policies to ensure a good start to life and a real prospect of getting well educated and thus a full place in the workforce.

The idea is that from that children-centred base policies will be reshaped for the education, health, housing, justice and welfare portfolios.

. . . King will not just speechify at the conference plenary. There will be a workshop — open to the media, unlike workshops at National’s fear-driven secretive conference — on the commission’s recommendations and the children-centred approach

On the other hand, in his monthly Management column, The brand-leaders of modern politics, James argues that “brand Key has it over brand Goff”.

Brian Easton’s most-recently-available Listener column is Unhealthy Start. I’m standing for election to the Capital & Coast District Health Board and one of the issues I’m most concerned about is health inequalities, so I was struck by his opening paragraph:

We used to think New Zealand was the best place in the world to bring up children. Alas, this is no longer true, as the statistics in the box below show. They come from a report by the Public Health Advisory Committee, “The Best Start in Life: Achieving Effective Action on Child Health and Wellbeing”. The committee says the main reason we do so badly is that we have no properly resourced public agency committed to improving health and well-being outcomes for children.

Out of 30 OECD countries, New Zealand is ranked:

  • 21st for infant mortality (5.1/1,000 live births)
  • 29th for measles immunisation rates (82% vaccinated by age two)
  • 20th for the percentage of children living in poor households (15% of all children)
  • 17th for children in overcrowded houses (31% of all children).

New Zealand fares poorly in other international comparisons. It

  • is fourth to bottom of all OECD countries for injury deaths among one-to-four-year-olds
  • has 14 times the average OECD rate of rheumatic fever
  • has rates of whooping cough and pneumonia 5–10 times greater than the United Kingdom and United States
  • has a four to six times higher rate of child maltreatment death than OECD countries with the lowest incidence.

Easton has also posted a speech to the New Zealand Home Health National Conference, but it was actually primarily about the global financial crisis and its fiscal ramifications. This is a topic I covered in my column last week, and Easton’s take on the economic outlook is similar. He starts by critiquing the mainstream analysis:

There is a general misunderstanding about the Global Financial Crisis. When the public became aware of it in late 2008, many thought that the Great Depression of the 1930s was repeating itself . . . The relief that a second Great Depression had been avoided swung opinion to the other extreme, so many thought there would be only a short cyclical downturn . . . within a couple of years there would be a strong economic recovery and the economy would be soon on its pre-crisis track.

Easton then raises “the gloomy prospect that we are going to have a long recession, a period of some years when the economy will broadly stagnate”, and considers what this means for public spending: “over a period we are going to have to restrain the expenditure path below what we thought it would be tracking in 2008.” As I did, he warns that this is something progressives also need to take seriously:

Note that even were there a government at the other side of the ideological spectrum, it too would have to severely restrain public spending. Of course it is in the interests of all political advocates to fudge the need for cutting public and private spending, but unless we do that we don’t get back on a growth track and prolong the recession.

Rod Oram’s Star-Times column is entitled The Harsh Truth on Hubbard and makes the case that, despite his virtues as individual, the fault for the collapse of South Canterbury Finance lies primarily with its founder.

In his business commentator slot on Nine to Noon, Oram weighs the various economic impacts of the Canterbury earthquake and argues for the Christchurch City Council to make bold urban design choices during the rebuilding.

Have you got a view on Labour’s policy renewal, children’s health, economic prospects, or the implications of SCF or the earthquake? Leave a comment below.

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Towards accommodation with capitalism?

Thursday, June 24th, 2010

This is the third in a series of posts about the development of progressive ‘theoretical foundations’ over time. The first part set out a ‘potted history’ of progressive thought from Marx onwards, while the second discussed how the neoliberal policies undertaken by some progressive parties during the 1980s (included the Fourth Labour Government) fitted into the ‘progressive canon’.

A recent comment from Greg highlighted that some of the theorists I’ve cited in my ‘potted history’ “seem to want to mount an attack on capitalism as a mode of production while others seem to want to work within it to further social justice and the development of human potential.”

Yes, that’s true, but I think that’s a fair reflection of the breadth of progressive theorists. Some have wanted to replace capitalism, while others have set out ways to reform it.

Moreover, my perception is that, with some variation (notably in the 1960s and ’70s), the move has been from the latter to the former, and with increasingly modest reform aspirations.

Let’s retrace our historical steps briefly. From Marx who argued that capitalism would bring about its own collapse, we move to Bernstein and his contemporaries who believed capitalism could be transformed from within.

In the 1930s and 1940s Keynes, Beveridge and their fellow-thinkers provided the basis for a managed model of welfare capitalism, and theorists like Crosland reframed the scope of the progressive project to fit this.

More recently, following the 1980s neoliberal ascendency I’ve described in my previous post, Third Way theorists like Giddens have reframed the project again. They have addressed the neoliberal critique and refuted some of it, but also taken into account things like a much reduced belief in government intervention.

We can envisage a sloping line, varying up and down over time but trending in a single  direction, which is away from a wholesale rejection of capitalism and going further and further in its accommodation with it. Not just in terms of abandoning any alternative to capitalism, but also accepting that market logic should prevail in most forms of economic activity. That is something that would have been regarded with horror during the high-tide of the mixed, managed economy in the 1950s and 1960s.

And I should emphasise that I’m not talking about the politicians here. Progressive theorists have also moved to a position of far greater accommodation.

I realise that these assertions may be rejected by some readers. Some of you may say, “Oh really? Which progressives?Which theorists?” You might claim that the pure heart of true progressivism is still beating strongly and radically, and has simply been obscured by the likes of Blair and Giddens. You will probably be able to point to individual theorists who are not accommodationists, and I’m sure some of them are doing important, ground-breaking work.

But. The centre of gravity is elsewhere.

The progressive theorists who get cited in all the journals, who have schools of thought built around them, and who the leaders of progressive political parties listen to and cite (or even the leaders of the left-bloc of parties – I’m thinking John Cruddas in the UK) are on the whole far more accommodationist than their equivalents a generation ago.

And, if anything, the serious theorists (as opposed to dissident polemicists) working out of a broadly Marxian tradition are probably where this shift is strongest. I’ve talked about Castells and the Regulationists; even if you add in Antonio Negri, things have still moved a long way from the time of Althusser and Marcuse, or Mandel and Miliband (snr). (In response to a another post, terence has cited another example of this: “Herb Gintis and Sam Bowles – two American economists who’ve made the long journey from Marxism to behavioural economics and game theory but who, in doing so, haven’t foregone left wing ideals.”)

But. Things could change.

In many ways the Global Financial Crisis was (or should have been) to neoliberalism what 1970s stagflation was to Keynesian demand management. In the initial reaction to the crisis, one could see a real opening for new ideas. For the moment, orthodoxy has reasserted itself and the problem has been reimagined as being essentially about government indebtedness, but that may not last.

And meanwhile, within the strands of progressive movement closest to the Third Way, we seem to be beginning to see projects like Open Left and the Amsterdam Process saying: perhaps we went slightly too far with accommodation.

It remains to be see whether, and how far, the pendulum will swing back towards a bolder progressivism. And if so, the question becomes how that will manifest itself in theoretical terms.

To some extent I think this will involve a return to the major thinkers of the 20th century like Keynes. But it is likely that it will also rely on new insights, and I imagine that many of them may be driven by the need to incorporate environmental sustainability into our standard economic models.

This series of posts has been largely silent so far about the work of environmental progressive theorists. There does seem to have been some important work we can turn to here — and the comments threads on recent posts have suggested some examples — but my sense is that progressive ecological political ecology has not yet seen its equivalent of Keynes’ General Theory (or Marx’s Capital or Smith’s Wealth of Nations, depending on your preference).

I’d also predict that a fruitful source of new insights over the coming period will be a cross-pollination between this ecological thinking and more mainstream economists (and political theorists) who are disillusioned by the crisis, concerned about the climate challenge, and looking for a new theoretical way forward.

An important part of the Theroretical Foundations topic will be trying to identify some of the emerging threads of that new synthesis as it begins to develop.

Links

Further Reading

  • Michael Hardt and Antonio Negri, Empire (2000)
  • Antonio Negri in conversation with Raf Valvola Scelsi, Goodbye Mr. Socialism (2008)
  • Donald Sassoon, One Hundred Years of Socialism. The West European Left in the Twentieth Century (1997)

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