MOYERS, KRUGMAN, AND PIKETTY’S CAPITAL

by Geoff Olson

Economists are a fascinating bunch; they either have their feet on the ground or their heads in the clouds. Sometimes they gymnastically squeeze their noggins into tighter places.

For an indication of their athletic range, I recommend watching Bill Moyers’ online interview with Paul Krugman.

Moyers is a journalist, former press secretary to president Lyndon Johnson, and host of a half-hour PBS show on political affairs. Krugman  is Professor of Economics and International Affairs at Princeton University, Centenary Professor at the London School of Economics, and an op-ed columnist for The New York Times.

Oh, and Krugman won the 2008 Nobel Prize in economics, too.

In 2013, the prof seriously suggested the US Federal Reserve mint a “platinum trillion dollar coin” if the Republicans tried to force the US government into default. In effect, he admitted that the Fed creates fiat currency out of nothing – a claim once limited to right-wing conspiracy circles.

But I digress. The topic of the interview was a book by Thomas Piketty, a professor of economics at the University of Paris. The reams of charts in Capital in the Twenty-First Century verify what most of us have heard already about the extraordinary gap between rich and poor in the United States. The “new gilded age” isn’t just hyperbole, it’s the demonstrable return of 19th century levels of inequality.

The divergence isn’t just a structural flaw in the American political economy, Piketty argues. It’s inherent in the very nature of capitalism, on either side of the Atlantic. The leapfrogging accumulation of wealth by those who already have it trumps wages in terms of economic growth.

The Sorcerer’s Apprentice of compound interest asymmetrically rewards those in the position to hoard money and stockpile real estate. “He with the most toys” may not “win” in the Charlie Sheen sense when they die – but their offspring certainly will, resulting in Piketty’s “patrimonial capitalism,” with its “drift toward oligarchy.”

This process of hereditary capital accumulation has been around for ages – it’s how the Rockefellers, Du Ponts, and other family dynasties have maintained cross-generational power and influence. Yet the French economist’s research came as something of a shock to some of his colleagues. “ I mean, even for someone like me, it’s a revelation,” Krugman told Moyers.

“Even people like me stopped talking about capital because we thought it was all about human capital. We thought it was all about earnings. We thought that the wealthy were people who one way or another found a way to make a lot of money,” Krugman added.

Seriously, dude? You chart the course of great financial rivers like a number-crunching Jacques Cousteau, yet this filthy-rich-are-different research came as a “revelation?”

We’re talking about a Nobel-prize winning economist and a public intellectual beloved by the American progressive left, not some slash-and-burn acolyte of the late Milton Friedman. At least Krugman acknowledged his discipline has a vision problem worthy of Mr. Magoo, and had the grace to recommend Piketty’s 700-page eye chart to his audience.

And to be fair, it wasn’t until Piketty and a few colleagues supplied the missing historical pieces that economists knew for sure that the dine-and-dash financial capitalism of the past 20 years wasn’t an anomaly, but a return to the historical norm. The French prof had the numbers, and economics is nothing if not a numbers game.

Although there are alternative models out there, neoclassical economics is usually taught in such a way that its ‘discoveries’ don’t call into question the power structures that money is embedded in. As for scientific accuracy, US economists couldn’t foresee the crash of 2008, much less time it. The predictive power of the “dismal science” is still little better than medieval theology.

Little wonder that last May, students from 42 economic associations in 19 countries signed a manifesto demanding changes in how they are taught. The manifesto condemned a “dramatic narrowing of the curriculum” that presents the economy as some bell jar experiment, conducted “in a vacuum.”

No revamped economics curriculum can afford to leave out Capital in the 21st Century. In fact, the Occupy movement’s rhetoric about the 1 percent came by way of Piketty’s original research, as popularized by former World Bank chief economist Joseph Stiglitz.

As for the well-meaning  professor Krugman, his Road-to-Damascus moment feels too little too late.

The Vancouver Courier, June 27

 

HITLER’S MEMOIR NEEDED AS A HORRIFYING REMINDER

By Geoff Olson

There’s a bit of a dustup happening in German publishing circles over Adolf Hitler’s autobiography, Mein Kampf (My Struggle). The book’s copyright is set to expire on the 70th anniversary of its publication.

There are two contending points of view on the Nazi leader’s book: It should be left to disappear into the waters of history, or revived as a historical artifact — if only as an instructional resource for the world on How Not to Think and Behave.

Mein Kampf is one of the greatest bestsellers of all time, selling between more than 12 million copies between 1924 and 1945 in over 1,000 editions, according to the CBC.

Hitler is commonly described as a monster, yet he wasn’t from another planet or the Earth’s core. And with fascism resurgent in Europe, the man should be remembered for more than just wrecking the brush moustache for hipsters. In other words, it’s worthwhile to understand where his all-too-human rage came from.

I’ve never seen Mein Kampf in a bookstore or library, so I went onto the web to seek out a pdf version in English online. It wasn’t hard to find.

Browsing through this disturbing artifact, I half-expected to find some convoluted rationalizations for Hitler’s racial hatred. But no. The author claimed he never even heard the word “Jew” in school or at home. His father was a “cosmopolitan,” which affected his son’s viewpoint “to some extent,” he wrote. “Likewise at school I found no occasion which could have led me to change this inherited picture.”

What follows is a classic study of psychological projection, with Hitler railing on about Jews in a frenzy of hatred. He follows this with, almost comically, “Gradually I began to hate them.” (He doesn’t appeal to that infamous Czarist-era forgery, “The Protocols of the Elders of Zion,” until page 223.)

Growing up in the wreckage of post-First World War Germany, the boy grew into a failed painter with an overwhelming sense of victimization. Following a failed putsch in 1923, he dictated Mein Kampf to his deputy Rudolf Hess while in jail. With the publication of Volume 1 in 1925, the upwardly mobile demagogue found millions of sympathetic readers, and millions of others who averted their eyes as one unthinkable event leapfrogged another in Germany, including Hitler’s crowning as Fuhrer of the “Thousand Year Reich.”

Many variables were involved in the rise of 20th century European fascism, but economic hardship stoked the flames. All it took was a simple formula of skin colour, religious belief, and ethnic tradition for propagandists to misidentify the sources of trouble.

As the Frankfurt-born psychoanalyst Eric Fromm explained in his 1941 book, Escape From Freedom, when the German middle class were confronted with chaotic economic and social circumstances, many among them were prepared to abdicate democratic representation for a strongman promising to restore order by flushing out enemies within the “Fatherland.”

Hitler’s genocidal regime is only a few generations back, a mere blip in historical time. And now that the postwar period of economic growth has stalled in the industrialized democracies, and disparities between rich and poor are reaching 19th century levels, the global petri dish is again host to the fascist bacillus.

Whether it’s the racist party Golden Dawn in Greece, the radical nationalist party Jobbik in Hungary, the extreme-right party Front National in France or the neo-Nazi militias rampaging through Ukraine, these and other movements owe some of their political DNA to 20th century goose-stepping. And many are no longer marginal in political influence.

We now hear echoes across Europe of Hitler’s enthusiasm for ethnic cleansing  — including a particular animus for the Roma people (Gypsies). The one place with a notable absence of racial hatred is Germany.

Let’s not forget the institutionalized racism just across our border. The U.S. has only three per cent of the world’s population but holds 25 per cent of the world’s prisoners. There are 7.6 times more black inmates in the U.S. prison population than white inmates, even though African-Americans constitute only 10 per cent of the entire population.

According to a 2008 study by Common Core, nearly a quarter of American 17-year-olds surveyed “could not identify Adolf Hitler; 10 per cent think he was a munitions manufacturer.”

Let the Reich Fuhrer’s disturbing autobiography disappear into history? It’s a tough call, but I think not.

The Vancouver Courier, June 20

BOOKS VS. BITS

By Geoff Olson

It’s that time of the season again. Time to head down to the beach with that dog-eared, sunblock-stained blockbuster you failed to finish last summer.

With our shrinking attention spans and busy lives, books seem harder  than ever to finish – or even start. Slim volumes swell to focus-demanding cinderblocks, even without getting damp from the beach. I Know Why The Caged Bird Sings becomes “I Don’t Know Why I Can’t Read The Damn Thing.”

At least that’s how it is with me. After about  six weeks of digital dithering, I tried getting back into old-school analog reading. I’d pull something from my bookshelf  and crack the spine in a spirit of optimism. Within the first few pages my mind would start pacing around like a Jack Russell locked in a bathroom. I kept feeling the gravitational pull of  my tablet and laptop.

I just wanted to sit quietly with a few of my favourite authors, but they rejected my attempts at print-based intimacy. Or rather, my brain rebelled. In just little over a month, it had turned into a junkie jonesing for another quick shot of dopamine from the online world.

I doubt a Kindle or other e-reader would help with the problem – certainly not if it had access to e-mail and websites. A study In Norway recently determined  that students learn better from texts on paper than pdf file on computers with 15 inch LCD monitors. Ebooks also come second to the printed page in terms of comprehension, according to Abigail Sellen of Microsoft Research Cambridge in England.

“The implicit feel of where you are in a physical book turns out to be more important than we realized,” Sellen told Scientific American. “Only when you get an e-book do you start to miss it. I don’t think e-book manufacturers have thought enough about how you might visualize where you are in a book.”’

It used to be when I focused on a challenging passage in a book, I would look up from the page and marinate in the words. It was something of a meditative practice. But my brain had traded deep and narrow for wide and shallow.

I totally get comic Patton Oswalt’s recent decision to swear off social media for the summer. “I’ve aggressively re-wired my own brain to live and die in a 140 character jungle,” he wrote on Facebook. “I want to de-atrophy the muscles I once had. The ones I used to charge through books, sprint through films, amble pleasantly through a new music album or a human conversation. I’ve lost them — willingly, mind you. My fault. Got addicted to the empty endorphins of being online.”

Oswalt became addicted to “ a portal to a shadow planet”  the “size of a deck of cards.” He couldn’t  keep himself “from peeling off one card after another, looking for a rare ace of sensation.”

Unlike the comic, I have no smart phone – just a dumb, lozenge-shaped one with an alphanumeric keypad and no Internet access. That’s quite deliberate on my part. As an info-junkie and info-hoarder by nature, I need extra distractions the way basketball honcho Donald Sterling needs an open mike.

Yet even with my pocket partner from the digital Palaeolithic, I was still struggling with that modern affliction, “continuous partial attention.” CPA results from incessant multitasking, which is the practice of simultaneously doing a number of things poorly rather than doing one thing well. I work at home and spend a huge chunk of my life online. For all the fantastic web sites, news portals, and links to pussycat videos, when I get out the door I prefer to be free of the attention-fracturing Borg.

In the words of writer and artist Douglas Coupland, “I miss my pre-Internet brain.” Coupland’s intellectual ancestor, Marshall McLuhan, was right. How you watch, listen or read is as important as what you watch, listen or read. The medium is the message.

“I need to dry out, and remind myself of the deeper tides I used to be able to swim in — in pages, and celluloid, and sounds, and people,” wrote Patton Oswalt before signing off.  For my part, I’m determined to start and finish a whack of books this summer. It’s a modest and numerically undefined goal.

The Vancouver Courier, June 13