Ph.D. Octopus

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Archive for the ‘capitalism’ Category

Quitting Goldman Sachs and the Logic of Capitalism

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by David

The internets is all abuzz about a fellow named Greg Smith, a former executive director of Goldman Sachs who publicly announced his resignation for the firm on the op-ed pages of the New York Times. Smith argues that while the firm used to be a place with a “culture” that “revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients,” it has become a place dedicated solely to making more and more money. “Today, if you make enough money for the firm (and are not currently an ax murderer) you will be promoted into a position of influence.” He writes of attending “meetings where not one single minute is spent asking questions about how we can help clients. It’s purely about how we can make the most possible money off of them.”

While most readers, I think, have rightly praised Smith for his decision, others have been somewhat critical, pointing to the fact that he quit only after receiving his latest bonus, or that his op-ed reads like a cover letter for his next job application, particularly this paragraph:

My proudest moments in life — getting a full scholarship to go from South Africa to Stanford University, being selected as a Rhodes Scholar national finalist, winning a bronze medal for table tennis at the Maccabiah Games in Israel, known as the Jewish Olympics — have all come through hard work, with no shortcuts. Goldman Sachs today has become too much about shortcuts and not enough about achievement. It just doesn’t feel right to me anymore.

The mention of the Maccabiah Games is especially amusing. Still, though I also applaud Smith, this Star Wars parody of the op-ed expresses my sentiments well.

Seriously, was Goldman Sachs ever really a place with that culture of honesty, “revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients”? Does anyone think “humility” and associate that with Goldman, or any investment banking firm, or really any high-level finance job on Wall Street? I think the first word most of us think of is “douchebag.” I’m sure that even when Goldman and Sachs were 19th century German-Jewish immigrant peddlers schlepping their dry goods around America, their business motto was always about the bottom-line.

Smith should know this. He is a clearly a smart, accomplished individual. But he got a full ride to Stanford. Presumably that means no loans, no debts. Why did he go work for Goldman in the first place? Did he honestly believe that even 12 years ago, the job was about anything other than helping rich people get richer, and getting rich in the process? Or was he sucked into the elite school culture that said that I-banking and consulting are the only way to go? A culture that said that the job was prestigious, a place for the smart and talented to excel, never mind what they were actually doing.

Also, we should not single out Goldman Sachs. I’m sure Smith would have worked at a different bank if Goldman had rejected him, and that bank would have the exact same “culture,” or lack thereof.

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Written by David Weinfeld

March 14, 2012 at 22:21

Hedge Funds, Holodecks, and the Science of Altruism

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by David

Leaf-cutter Ants Carrying Leaves Back to the Nest

I just read a great article in last week’s New Yorker, “Kin and Kind: A Fight About the Genetics of Altruism,” by Jonah Lehrer. Unfortunately, it’s behind a pay-wall, so you should try to find a paper copy somewhere. As a humanities major, I can’t really do it justice, but it’s all about how various species, from vampire bats to the above pictured leaf-cutter ants, engage in different degrees of altruism, from the Darwinian phenomenon known as “inclusive fitness,” where animals look after not only their own offspring but also their nephews and nieces, to the “eusociality” of ants and other insects, “in which individuals live together in vast cooperative societies.” Human beings, of course, also live in complex cooperative societies, regardless of what Republicans might tell you about rugged individualism. The article is also about the academics attempting understand the biology behind benevolence, the “genetics of altruism,” and includes interesting discussion on the difference between mathematicians and biologists, who have been working together to understand these phenomena.

Dr. Corina Tarnita, math whiz/altruist

What interested me the most, however, was an apparent throw-away paragraph (that was clearly not a throw-away paragraph) about one of the scholars involved. Corina Tarnita, a math prodigy who grew up in rural Romania, had excelled at Harvard as an undergraduate, but was becoming bored in a doctoral program there until she discovered a textbook on “the mathematics of evolution.” Unlike her previous research on abstract algebraic geometry, this seemed more concrete, and got her excited. She emailed the author of the textbook, Austrian biologist Martin Nowak, also at Harvard, to see if she could work with him on this. But her life remained at a crossroads:

At the time she emailed Nowak,Tarnita had a dilemma. She’d recently received a job offer from a large hedge fund, for a lucrative position as a quantitative analyst. She was tempted by the money. “I like fancy clothes and fast cars,” she says. “I told myself that if Martin didn’t email me back then maybe I would leave Harvard.” Fortunately, Nowak responded and soon invited Tarnita to join his working group.

The word “fortunately” in the final sentence reflects a bit of editorializing on the part of the piece’s author, Jonah Lehrer, but it’s an opinion I’m sympathetic to. I think it would have been rather disappointing had Tarnita given up a potentially path-breaking career in the academy for the rewards of Wall Street.

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Written by David Weinfeld

March 6, 2012 at 08:21

Occupy Economics?: A Report Back from the Nerdiest Protest I’ve ever been to.

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By Peter

I just got back from Chicago, where, along with attending the American Historical Association, I participated in a series of protests held by Occupy Chicago, along with CACHE (Coalition Against Corporatization of Higher Education) that targeted the American Economics Association (AEA). Its not everyday that the worlds of street protests and academic conferences blend so well. But then again, part of the point was to “puncture the bubble,” that academic economists live in.

The protesters gave out “alternative” awards for Most Conflict of Interests (Columbia’s Glenn Hubbard), Intellectual Narrowness (Harvard’s Greg Mankiw), and top prize, the “Toxic Waste of Space Award” (Harvard/Obama administration’s Larry Summers). Other than a brief yelling match that one protester got in with a professor, the tone was light and fun. Protesters “accepted” awards acting as Mankiw, Hubbard, and Summers (who reminded us how much smarter he was than us) and served “Rahmon” noodles, in honor of the Chicagoans impoverished by Rahm Emmanuel’s neoliberal policies. Overall a lot of fun, albeit fun that might have gone over the heads of the random shoppers on Michigan Ave.

According to protesters: “The bankrupt ideologies of ‘neo-liberalism’–trickle-down theory, austerity, deregulation, privatization–have all been proven empirically disastrous. Those ideas still enjoy a monopoly in the mainstream debate due to the massive scale of academic subsidizing by the bought AEA and it’s cohorts in the 1%.” Watch a great interview with an organizer at the bottom of this post.

It just so happens the protests came at a time of particularly hot debate about the ideology of the economics profession. The recent release of the minutes of the 2006 Federal Reserve Meetings well illustrates—along with Timothy Geithner’s utterly pathetic sycophancy towards Alan Greenspan—that the High Priests were asleep on the job, completely unaware of the looming housing crisis. Said one professor quoted by the New York Times:

“It’s embarrassing for the Fed,” said Justin Wolfers, an economics professor at the University of Pennsylvania. “You see an awareness that the housing market is starting to crumble, and you see a lack of awareness of the connection between the housing market and financial markets.”

“It’s also embarrassing for economics,” he continued. “My strong guess is that if we had a transcript of any other economist, there would be at least as much fodder.”

Not the discipline’s finest moment, no doubt.

I have a longstanding hatred/fascination with the foundational logic taught in modern Economics courses: its technocratic imagination, its inability to question its own premises, its ahistorical logic (see Daniel Rodgers’ Age of Fracture, Chapter 2 for more on how society, power, and history dropped out of the Economics discipline), its inattention to moral consequences, its reductionism (like the horrid Freakonimics series, which thinks all aspects of human existence can be explained by their simplistic assumptions about human behavior), and its normative amorality (seriously, studies have shown that taking economics makes students less generous people).

And this is all important because Economics inhabits a unique disciplinary position. Part academic discipline, part incubators of elite policy makers, academics in no other departments transition so seamlessly from academia to government to Wall Street. Look at a figure like Larry Summers, who has (in the last five years alone!) inhabited leading roles in all three worlds. While taking money from Wall Street while producing intellectual material about Wall Street suggests casual corruption, the influence that economists, and what Tony Judt called economism (the tendency to think of all social problems in terms of the marketplace) has deep ramifications on our public policy. The very power of economists makes it more likely that they will be captured by elites. I think, then, it is fair to target the AEA, even if many, if not most, economists are actually innocent of any corruption. It matters to the public what economists talk about, much more so than whats going on in, say, the MLA.

A silver lining, though, to the economic collaspe might be a rethinking of some economic thought.

Writing about the great shift in Economics departments that occurred in the 1970s, as Samuelson, Galbraith, and the other Keynesians lost favor, Daniel Rodgers writes:

“The economic crisis of the 1970s was, in short, not merely a crisis in management. It was also, and at least as painfully, a crisis in ideas and intellectual authority. An extremely confident analytical system had failed to explain or make sense of the unexpected.”

The results, according to Rodgers, were that the profession increasingly moved towards a more neoclassical model and microeconomics prevailed over macroeconomics. Meanwhile, the logic of markets and economic thinking invaded other disciplines: rational choice theory in political science, the “law and economics” movement in law schools, etc… One hopes that our recent crisis and the inability of our policy elites to predict or solve the problem, will produce a similar paradigmatic shift. This time, though, hopefully it will be away from such apologias for capitalism.

So in that spirit, I wanted to highlight two interesting thinkers. The first, I saw over at Crooked Timber, where New School economist Sanjay Reddy gives a fabulous interview about the need to bring moral reasoning back into the study of Economics. Reddy argues against the notion that Economics is a value-neutral science, restoring an “evaluative framework” to the discipline. It is impossible, he argues, to come to purely technical solutions to most problems. In a sense, Reddy is asking that we take moral sides before we engage in economic debate. First, for instance, we say that a goal of policy should be to aid the poor, then we figure out ways to so.

This seems to fit well with an article in the latest issue of Jacobin magazine (also featuring an excellent piece by friend of the blog, Andrew Hartman), by Mike Beggs, calling for radicals to occupy economics. Begg’s article asks economists to be less technocratic, and more openly political in their ends. Beggs takes a middle ground (for radical intellectuals), acknowledging that “mainstream economics is both an ideological bastion of capitalism and a genuine social science.” A tool for understanding the world, it is also wrapped up in a set of assumptions that are not neutral, but that favor a free market approach to the world. Nevertheless, as Begg’s points out, the stereotype that many have of a discipline of Milton Friedmans is actually unfair. A wide swath of economists agree with the need for some government intervention, and, other than a few reactionaries in Chicago or George Mason, most also acknowledge the importance of Keynes. The problem, Beggs suggests, is “not that mainstream economics was delusional, or biased to the right, but that it was technocratic.” It presumed it could manage and control, rather than take sides in class warfare.

In the opening editorial of Jacobin, the editors declare that, as the rebellion of Occupy Wall Street spreads, “we are in the last throes of the era of Ezra Klein.” What they mean, I think, is that the tepid liberalism of the technocratic elite (poor Ezra has, a bit unfairly, become a symbol of this) says nothing to the fundamental message of the OWS movement: the restoration of politics—full throated politics—to our understanding of class and economics. Class will no longer be something discussed in dry studies by the Brooking Institute or in economics seminars, but in the chants and marches in the streets, as those without challenge those with. Millions of people simply standing up and rejected these “market-based” solutions that have been crammed down our throats, will do more to change the dialogue than any polite article or policy paper ever will.

Written by Peter Wirzbicki

January 16, 2012 at 23:21

Romney, Bain, Letters, and Archives

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by David

Mitt in the middle, celebrating his first love, money, along with the boys of Bain capital

People in both parties are attacking GOP frontrunner Mitt Romney for his time at Bain Capital, a private equity firm that bought companies, downsized them–that is, fired many employees–and then sold those companies at a profit. Even his rivals in the Republican primaries have taken something of an anti-capitalist line, in opposition to the free markets that Romney represents.

As readers of this blog can guess, I don’t have a particularly high opinion of Mitt Romney. The only office I’d ever elect him to would be the captaincy of team douchebag. Nonetheless, it’s important to know whether we’re asking the right questions about his time at Bain.

My free market friend Josh, now writing for Forbes, has identified the right questions. But first, he explains some basic but important economics.

Private equity firms like Bain often seek to fix firms that have failed to adjust to economic change. This can mean downsizing, increased automation, offshoring, and the like. These changes make enterprises more efficient, and in some cases save firms that would otherwise have gone bankrupt. These kinds of changes also produce broad-based gains that should not be discounted, particularly in the form of lower consumer prices. We could not, and should not, have stopped these changes in the economy.

As Josh notes, certain classes of workers have been hit especially hard. While capital has benefitted, workers have seen layoffs, pay-cuts, and long term unemployment, particularly those with skills that have become less valuable or even obsolete. Josh is right to argue that as a businessman, Romney was correctly concerned with making his company profits, not with the plight of his laid off workers. But Josh wisely adds, “while the human effects of these economic shifts are not properly the concern of business executives, they are the concern of government officials, and Romney wants to be president.” And so the right questions are:

What policy implications arise from the economic shifts of the last few decades, driven (in small part) by private equity. Does rising income inequality mean that fiscal policy should be more redistributive? Does a reduction in job security call for a stronger safety net? Do new workforce needs mean we need a shift in education and training policies?

Basically, the president is not a CEO, and it’s his or her job to care about all the workers, and the economy as a whole. And if you don’t want to take Josh’s word for it, take Paul Krugman’s, who said pretty much the same thing in his recent column. Josh reminds us that “as governor of Massachusetts, Romney’s signature policy achievement was a universal health care program—that is, a safety net program that reduces the cost of job loss or income loss.” Of course, Romney has said that Romneycare worked for Massachusetts, but the Affordable Care Act, patterned after Romney’s plan, is no good for nation. But that’s a whole other discussion.

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Written by David Weinfeld

January 14, 2012 at 14:19

A Different Cracow

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by David

Cracow I remembered. My memories of Warsaw from 12 years ago were much dimmer, but Cracow stood out in my mind. I remembered the old synagogues, the oldest built into the ground so as to avoid being taller than churches. I remembered hassidim scurrying about. I remember standing by the Wawel Castle, though all our guide told us was that Nazis set up their Polish General Government there and placed a swastika flag atop one of its towers.

A lot has changed in 12 years. Despite the old buildings, Cracow feels like a new city, the economy revitalized, tourists heading from shop to shop. The place is almost painfully charming, and pardon the pun, you get the feeling that hanging out in city’s medieval central square never gets old.

Of course, I’ve changed a lot too. When I came to Cracow in 1999, I was a boy of 16. I didn’t know any history at all, especially non-Jewish history. Since then, I’ve been privileged to attend Dawson College’s Liberal Arts program, where I received a steady grounding in European history, reinforced by my bachelor’s degree at Harvard. At NYU, my focus shifted to the United States, but I took a couple of courses, in eastern European history and eastern European Jewish history, that gave me the knowledge, if not the languages, to understand the region. Frankly, I think both me and the city have changed for the better.

This time around, I made a point of not limiting myself to the Jewish sites. I actually entered Wawel Castle, explored its state rooms, and stood in awe of its beautiful cathedral. I hit all the major churches listed in Cracow’s In Your Pocket guide. I don’t think I went to a single church in 1999, and what a shame that was. But I doubt I would have appreciated them then anyway. I’d have been amazed by their beauty, but without any understanding of the role Catholicism has played in Polish history. Wawel Castle was so much more meaningful now that I know something about the Polish-Lithuania Commonwealth, and about the three partions of the battered nation in the late 18th century.

I know more Polish Jewish history now too. I understand the role that antisemitism played in revitalizing Polish nationalism, particularly in Galicia, in the late 19th century. From David Engel, I learned that Jews had been invited into the Polish kingdom, but the population expected them to behave like guests, not citizens, placing them a good distant apart even when citizenship was finally granted to them. I’m no expert, but apart from knowing whether to spell Cracow with a “c” or a “k,” I think I have a decent handle on the place.

And this time around, going to those synagogues was more meaningful. Instead of focusing on the death and destruction, I imagined that my grandfather and great aunt may have prayed at any one of them while they attended the Jagiellonian University in the 1920s.

Walking around the Jewish neighbourhood of Kazimierz, I saw life rather than death. The place had certainly changed since 1999. It was somber then. Now, tourists, Polish and foreign, populate the streets. The hassids are still there, but they seem more comfortable. And the kitsch has exploded. One Jewish history professor I know compared it to Disneyland. I see it more like Colonial Williamsburg, except without the tacky costumes and with a death camp an hour away.

This didn’t entirely bother me though. Sure, tour go-courts whizzed past us advertising trips to Schindler’s Factory (unopened in 1999) and visits to nearby Auschwitz. Norman Finkelstein’s book The Holocaust Industry comes to mind, except I see no need for that degree of cynicism. Tourists should see the death camps. And seeing death camps costs money. And that money is lining some businessman’s pockets, not advancing the Zionist cause. If capitalism helps people learn, in the most vivid way possible, about the defining tragedy of the 20th century, then so be it.

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Written by David Weinfeld

September 12, 2011 at 17:26

The New American Underclass, the Unraveling of America, and Bruce Springsteen: A Review of Someplace like America

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By Peter

According to a recent study by the National Employment Law Project, the vast majority of new hires made since the Great Recession has started have been in low wage jobs. People are losing mid or high wage jobs and gaining low-wage jobs. Meanwhile the wealth gap between races is the worst in 25 years. Black families have lost half their median family assets, and Hispanics have lost a shocking 2/3rds of their median household assets.

From a bird’s eye view, then, the Great Collapse of 2008, which many of us thought would be the death-knell of neoliberalism, has turned out to be its best friend. As is often the case, capitalism will come out of the crisis reorganized and restructured, with access to desperate low-wage workers, who no longer even expect mid-range wages, a larger reserve army of the unemployed in order to keep those with jobs in line, and a radical Tea-Party led (and Democratic- abetted) assault on unions, government regulation, and social services. Those who still have jobs are working more hours and seeing their responsibilities multiply, while getting paid less. The age of austerity may finally realize Milton, Barry, and Ronald’s dream of destroying the post-war social compact.

And yet, as Dale Maharidge points out in Someplace like America, a new book of photographs and stories from the Great Recession, for most low-income America, the Great Recession (or as he calls it “The New Great Depression), began decades ago. Since at least the 80s, Reaganite economic policy has created a growing underclass of Americans, who have largely seemed invisible to American society. For a brief moment in 2009, Mahardige remembers, journalists were interested in the tent cities springing up outside of cities in California and Florida. But they wanted to hear about people who had just lost their jobs. In fact, most of the residents had been struggling for years, even during the supposedly good times of the 90s. The Crash simply broke the camel’s back.

In some ways its an underclass whose lives seem familiar to us: the men and women who ride railroads, sleep under bridges, squat in abandoned factories, hover outside of overcrowded breadlines, and drift from town to town drawn by rumors of work seem all reminiscent of Woody Guthrie songs and John Steinbeck novels. But it also deeply alien to see it today, which is why many of the most jaring photographs juxtapose images of 21st century American consumption (a Kenny Rogers ad, a faded Office Depot sign, a Wal-Mart, etc…) next to images of 21st century poverty, to familiarize us with a phenomenon we were told doesn’t exist anymore. Suburbanization and the creation of highways has, to a large degree, pushed this poverty out of sight. The poverty rate in the suburbs, where poverty tends to be much less visible, has been skyrocketing.

In many cases, these are men and women who have known better. Much better. There is a sense of bewilderment to the unraveling of the Fordist social compact, as people can’t quite understand why they don’t have the opportunities their parents did. There is B.T., found selling his life’s possessions alongside a highway in Tennessee, in order to buy food. He was an auto mechanic for years, and was laid off a year and a half ago. “I’m ashamed. I’m the kind of guy who works. I always worked… I haven’t gone to the church yet, because I’m a little embarrassed,” he says. His area of Tennessee was devastated by NAFTA, as the Oshkosh factory closed up and went to Honduras.

The authors go to Youngstown and follow the diaspora of workers, scattered after the devastating closures of the steel mills. In a shack outside of Houston, they find one. His grandfather had worked in the mills in Youngstown, he had hauled steel. When it all crashed down, he lost his job, drank, and drifted. Now he “babbled nonsense… a creature that once was a man,” and lived on the streets. They interview Sally, an “upper-middle class” mother, whose husband was a business-owner. Now she’s waiting outside a food bank in Michigan with a crowd of people. “None of the 224 faces,” she stands with, “register as being any different from those you’d see in a suburban shopping mall.”

One picture is of a family—the baby stares directly at the camera– while the family is too embarrassed to look-up —in line at a free health care clinic in rural Virginia. The caption is the kicker: The Remote Area Medical Volunteer Corps used to only work with the “desperately poor” in third-world countries. Now it operates largely in rural America.

True poverty, Maharidge points out, takes some time to kick in. At first, when people lost their jobs in Youngstown, they survived. Some found new jobs, others accepted lower pay. Many drifted on unemployment or disability. But eventually these supports dry up, and the longer you’re out of work, the harder it is to get new employment. You are evicted or foreclosed, your family or friend gets sick of you crashing with them, and you move on. Maybe you hear about an opportunity a couple of towns over, but can’t afford a hotel room or a deposit on a rental. So you begin sleeping in your car. Gas and maintenance becomes too much, so you hitch or walk. Many sell blood or begin scrounging food from wastebins, at first in moments of despair, later as an everyday activity. The embarrassment and stress gets to people, who begin abusing drugs or alcohol. Many are victims of theft, murder, or rape, and rarely do the police investigate.

As the Great Recession continues (and it is continuing for most people…) the middle class is falling into the lower class, the lower class falling into the poor, and the poor falling off the social map into the informal economy of scrounging, subsistence farming, petty thievery, homelessness, prostitution, and the like. There are almost certainly more Americans who live like this then, say, Americans who watch the Daily Show. Mahardige and Williamson introduce us to “Edge men,” people who have completely given up on the prospect of employment, and squat or set up tents outside of cities, to live permanently outside of society. With years of high unemployment, and millions of so called ‘99ers approaching the end of their benefits, we better get used to seeing these people.

The authors of Someplace like America had previously collaborated on Journey to Nowhere, which had the distinction of inspiring a number of Bruce Springsteen songs, including Youngstown. There is a line in that song, “those big boys did what Hitler couldn’t do,” referring to the destruction of the steel mills. It comes directly from an unemployed steel worker Joe Marshall Sr. There is an odd section of Someplace like America, where the authors meet Springsteen and sneak into the abandoned Jeanette blast furnace (the “Jenny”) to contemplate what’s happening to America. I’ll give Bruce, who wrote the introduction to this book, credit. In his own way he’s been warning about this stuff for decades, while much of the left couldn’t even use the word “class.” During the heady days of Morning in America, while the Democratic Party began its now unbreakable marriage with Wall Street, he was writing about the consequences of these policies. He saw the future better than most political pundits did.

Even many of us on the left aren’t nearly as comfortable talking about poverty and class, as we were in the 30s. We’re comfortable with racialized urban poverty, which makes sense in our post-68, urbanized, information-age worldview, but have pushed rural poverty (white or black) completely out of our imaginations. We live in Brooklyn or Cambridge or San Francisco or Portland, little bubbles that have done much better than the rest of the country. Our discourse is almost completely unable to talk about poverty except as a technocratic problem. The moral core of the problem—that some have so much and some have so little, and that this is a result of collective decisions we have made—can not fit into our ideological imaginations.

Which is why the photographs by Michael Williamson are so important. I wish there were more. It’s a book that is self-consciously in the tradition of Let us now Praise Famous Men (the authors previously had done a follow-up, called And Their Children After them) and Dorthea Lange. The photos are stark black and white images, often of destroyed mills or houses, with only slight traces of human activity. When he focuses on a human subject, often the faces are obscured, as the child pumping water by hand, from the only source of fresh water in Bayview Virginia, a rusty iron spigot. B.T., the unemployed mechanic selling his life’s possessions from the back of his truck, looks down, ashamed of what he’s doing. Perhaps my favorite photography is of “Edge Man Ed.” You only see him in silhouette against a gigantic garish photograph of smiling Kenny Rogers smoking a cigar. Ed had saved the plastic sheeting from a Rogers’ billboard and was using it to make a tent out of.

Williamson walks a fine line, between drawing attention to the poverty and helplessness of his subjects and trying to find the dignity and resolve in their faces. It’s hard not to see the same tension in how Mahardige talks about the subjects or we think about them. Too much pity makes them degraded victims; too little anger is inappropriate.

Written by Peter Wirzbicki

July 28, 2011 at 14:34

Gay Paradise in Zion? A Commentary on The Enlightenment Project

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by Weiner

Several years ago, I was having dinner in Dupont Circle, a gay-friendly neighbourhood in Washington, D.C., with a gay Jewish friend and his boyfriend, also a Jew. My friend, who describes himself as both a “professional Jew” and a “professional gay,” brought up the topic of Israel. I don’t recall exactly what was said, but both he and his boyfriend expressed pride in the fact that Israel was rather tolerant towards gays and lesbians, much more so than its Arab neighbours. I agreed with the sentiment, but expressed some skepticism as to its value.

I remember saying that many right-wing, hawkish supporters of Israel, would proudly praise Israel’s record on gay rights, or women’s rights, or any other issue that showed that Israel was a modern, western, country, with a tolerant, progressive society, not unlike that of the United States or Canada. I remember thinking that these people didn’t give a rats ass about gay rights in America, or about feminism anywhere in the world, apart from trumpeting Israel’s superiority over its backward Muslim enemies. This was especially true for Israel’s Christian Zionist supporters, many of whom were actively hostile to gay rights and women’s rights.

This sort of analysis always made me a little uncomfortable, like comparing the Israeli military’s efforts to reduce civilian casualties with the goals of Hamas suicide bombers, who hoped to maximize them. Having the best human rights record in the Middle East is a little like being the best student in a remedial math class: not something you should really be boasting about. Sure, Israel is more tolerant of gays and lesbians, and more progressive on women’s issues than Syria, but so what? As a modern, western, democratic state, shouldn’t it aspire to play in the big leagues with the United States, Canada, western Europe and the like?

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Written by David Weinfeld

July 11, 2011 at 16:00

Damn the Man, Save the Stuff We Like

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by apini

I just re-watched Empire Records for the first time since…1998?  It used to be my favorite movie.  It didn’t really hold up as well as I had hoped, but something did stick with me after watching it again.  Remember when we used to pay for stuff in order to stick it to the man?  Like at the end of the movie, where everyone comes along and buys loads of CDs and records and beer in order to keep the store alive in the face of a corporate take-over?

That movie came out in 1995, before anyone really knew what the internet was for and before everything became free.  To my generation, music, movies, news, software all came free from the not-yet-illegal-but-will-be-as-soon-as-the-corporations-figure-it-out services.   For us, getting stuff for free was a right that corporations were trying to deny us.  Couldn’t they see that their models were out of date?  Couldn’t they see that content should be freely available to everyone?  Take that, Corporate America – we’re getting our stuff for free!

It didn’t help that the corporate bad guys were about as square and whiny as David Spade in PCU.  They whined about how being able to get things for free was

cutting into their profits.  As though teenagers care about corporate profitability.  They called what we were doing piracy of all things.  Like piracy’s a bad thing.  And the ‘You wouldn’t steal a car’ ad campaign presumed too much.  They made it so easy to hate them and all the things they stood for, just like Music Town in Empire Records (banning visible tattoos, revealing clothing, loud music, etc).  Newspapers seemed trickier, but Rupert Murdoch was buying them all anyway, right?

So what changed for me?  Why am I sitting here, about to click ‘confirm’ on my New York Times app subscription?  I think it’s for the same reason I just donated to NPR/APM.  And the same reason that I Read the rest of this entry »

Written by apini

March 31, 2011 at 12:41

Ayn Rand vs Karl Marx: Nobody Wins

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by Weiner

I tried to read The Fountainhead. I really did. But after ten or fifteen pages, I gave up. The text was so poorly written, so comically absurd yet mind-numbingly dull at the same time that I had to put it down. In my snobbery, when I see  a smart friend’s profile on Facebook which lists one of Ayn Rand’s books as their favourites, I feel a sense of tremendous disappointment, the way I used to feel when I saw similarly smart people list The Da Vinci Code. Except The Da Vinci Code, however stupid, is a quick, entertaining read, and doesn’t turn its readers into sensational assholes (also, Dan Brown may be a bad writer, but he never really hurt anyone except the Catholic Church, and they had it coming). I could get through The Da Vinci Code. I doubt I’ll ever be able to stomach Atlas Shrugged.

Of course, you don’t need me to tell you about how bad Ayn Rand’s books are, or how stupid her philosophy of Objectivism is, or how much harm its adherents (converts?) have done to the American economy. I’ve addressed that a little bit here, and so has Wiz  here, and so did GQ‘s Andrew Corsello in a hilarious hit piece titled “The Bitch is Back.” Corsello compares reading Rand (pictured left) at age 19 to “devouring a family-size bag of Cheetos in a single sitting. During: irresistible, bracing, the thing at hand imparting vitality, fertility, potency. After: bleccchh.” I never got to the irresistible part, but the urge to vomit came soon enough.

I think Rand’s work can best be summarized with an old intellectual putdown my father taught me: “Ayn Rand’s writing is both interesting and original. Unfortunately, what is interesting is not original, and what is original is not interesting.” I’d add that it’s also inaccurate and harmful and even downright pernicious, but that’s enough for now.

Perhaps the best short takedown of Rand can be found in The Nation, by Corey Robin. But if you’re looking for something a little longer, but don’t have the stomach for Rand herself, try this superb intellectual biography, Goddess of the Market: Ayn Rand and the American Right, by Jennifer Burns.

In Burns’ book, we learn about the crazy cult of Objectivism, which Rand ran like an authoritarian tyrant. To call it quasi-religious might be a bit mild. As Burns writes on page 203:

Although Objectivism appeared a way to escape religion, it was more often a substitute, offering a similar regimentation and moralism without the sense of conformity. Rand’s ideas allowed students to reject traditional religion without feeling lost in a nihilistic, meaningless universe.

And yet three pages earlier, Burns compared the adoption of Objectivism to a similar religious experience.

In many ways the overwhelming impact of Rand’s ideas mimicked Marxism’s influence. Arthur Koestler’s memory of conversion to Communism echoes the sentiments expressed by Rand’s readers: “The new light seems to pour from all directions across the skull; the whole universe falls into pattern like the stray pieces of a  jigsaw puzzle assembled by magic at one stroke. There is now an answer to every question; doubts and conflicts are a matter of the tortured past.” Only a small portion of Rand’s readers became as feverishly devoted to her ideas as Koestler did to Marxism, but the basic dynamic was similar. A twenty-four-year-old woman told Rand, “you have combined all my stray thoughts into an orderly, workable pattern–this alone is worth many years of my life.” Rand’s perspective could bring refreshing clarity to the unfocused, replacing doubt and uncertainty with passion and conviction.

It’s no accident that Burns used the word “conversion” to describe Koestler’s Marxist turn, nor that Koestler the himself used religious, even miraculous language to recount how he saw the “light” of scientific socialism. Objectivism, like Marxism, and most religious doctrines, are absolutist and all-encompassing philosophies.

When I first seriously studied Marx (pictured right) in the Dawson College Liberal Arts program (with Nemo among my classmates), our wonderful professor David Mulhall frequently used the term “millenarian” to describe Marxist thought. To Mulhall, and of course he was not the first to say this, Marxism was a fundamentally messianic faith, with its belief in the withering away of the state and an eventual Communist utopia, despite the mask of materialism. That description stuck with me.

When I studied Marxism as an undergraduate, I did so in the context of European intellectual history, with the brilliant Peter Gordon. With Gordon’s guidance, I came to understand Marx primarily as a “Left Hegelian,” someone who did not merely stand “Hegel on his head,” as Marx’s own cliche would have you, but in fact simply adapted Hegel to a more practical, materialist framework. Hegel’s messianic “world spirit” became Marx’s messianic working class, both operating in dialectical fashion.

When I finally studied Marx as a graduate student, in a History of the Left class (along with Wiz) taught by the excellent professors Molly Nolan and Linda Gordon (no relation to Peter, as far as I know), I had had enough. As a moderate social democrat and strong supporter of the welfare state, I was the class fascist, by far the most conservative, and probably the most vocal participant. This was certainly a strange scenario as a Canadian among mostly American students. I won’t lie: I relished the role. More important, I learned a great deal in these class discussions.

Of course, the stakes were pretty low. As my free market friend Josh once quipped: “the only place you’ll find real Marxists is in the humanities departments of universities, which is a good thing, because they can’t hurt anyone there.” This remark isn’t all that different from an observation made by the late Irving Kristol in his 1979 essay “The Adversary Culture of Intellectuals.” Kristol wrote, “if you want to meet active socialists intellectuals, you can go to Oxford or Berkeley or Paris or Rome. There is no point in going to Moscow or Peking or Belgrade or Bucharest or Havana.” Much as I loathe Kristol, he, and Josh (who I quite like) may be on to something. As the semester went on, much as I enjoyed it, I became exasperated.

You see, I felt that the class, like much of academia, venerated (and venerates) Marx in a way that is totally inappropriate, and frankly ahistorical. This will offend some readers (and possibly writers) of this blog, but when I hear obviously Marxist academics make obviously Marxist arguments, my eyes secretly glaze over (or perhaps not so secretly, if my subtlety is wearing thin) much in the same way they would if I had to listen to a Creationist defend the Biblical account on the universe’s origins, or an Intelligent Design advocate attempt to mesh Darwin with God’s divine plan. It’s like that feeling you get when you meet very smart and devoutly religious people and you think to yourself “how do intelligent people believe this nonsense?”

And yet many smart people did and do in fact, “believe this nonsense.” As the late Tony Judt wrote of the Trotsykite Marxist Isaac Deutscher (pictured below):

I remember being spellbound by the fantasy history of the Soviet Union woven in his Trevelyan Lectures at Cambridge by the elderly Trotskyist Isaac Deutscher (published in 1967 under the title The Unfinished Revolution: Russia 1917–1967). The form so elegantly transcended the content that we accepted the latter on trust: detoxification took a while. Sheer rhetorical facility, whatever its appeal, need not denote originality and depth of content.

This is not to say that Marx is entirely devoid of “originality and depth of content.” I don’t really think Marx is nonsense. The funny thing is, I love Marx. I really do. I think his writing was and is sensationally inspirational. Politically, I think his vision is impractical but nonetheless alluring, his goals noble and moral. I even think that his observations about working class life in the 19th century, with the industrial revolution reaching full steam, was incredibly astute.

But there’s the rub. As a historian, I can’t help think we’d be better off looking at Marx in his context. Yes, his description of worker alienation, and commodity fetishization can still ring true, in certain very specific circumstances, like in the developing world today. But on the whole, one cannot escape the fact, and yes it is a fact, that Marx got a whole lot wrong. He thought nationalism was a weak force, but in fact it was (and is) a very strong one. More important, he never recognized the power of a middle way, of strong welfare states offering a restraint on, rather than the destruction of, the market economy . He never imagined the compelling appeal of unions, like those of Samuel Gompers (pictured right) that offered “bread and butter” benefits to dignify workers within a capitalist framework (minus Gompers’ racism and sexism).

More important, Marx didn’t realize that most workers wanted to cease being workers, or at least, ensure that their children would not have to work like they did. Indeed, the story of eastern European Jews in America serves as a spectacular refutation of Marxism. Many came with dedication to socialism in hand, or more likely one that they learned on the job. They were active in left wing politics on New York’s Lower East Side and elsewhere. They worked in sweat shops, and lived in dilapidated tenement apartments. But eventually, they sent their kids to public school, and their kids became doctors and lawyers and entered the middle class. They mostly (though not all) remained on the left, but typically the mainstream left, of the Democratic Party. Their class consciousness was no more, if it ever really existed.

There’s no way Marx could have anticipated any of this, let alone i-phones and the Internet and a million other kinds of technological, scientific and philosophical and historical developments that have laid waste to his theory. Which is why, as I said earlier, we should understand Marx in context. And the same goes for Rand. Incidentally, that’s precisely what Burns does: her Rand responded to her upbringing as a middle-class Jew in Russia and then the Soviet Union, her disillusionment with the New Deal, and her distaste for the Judeo-Christian religiosity of mainstream conservatives, and role as a fierce Cold Warrior. But she too, like Marx, could not anticipate history.

As I’ve written here before, one of the biggest problems with Marxism, as the great philosopher Sir Karl Popper (pictured below) elucidated many years ago, was it’s utter imperviousness to “falsifiability.” As Popper wrote, “the criterion of the scientific status of a theory is its falsifiabilityor refutabilityor testability.” Marx’s socialism, like Freud’s psychoanalysis, could not be scientific, because they couldn’t really be proven or disproven. As I wrote then:

[Popper] criticized Freudian psychoanalysis and Marxian economics on the ground that they were not falsifiable. Their advocates found evidence in every result, even ones that seemed to blatantly contradict these “theories.” The Marxist revolution never happened, so Marxists tweaked the theory, rather than abandon it. They forced a strange fit of theory and fact, rather than simply form a new theory. Einstein’s Theory of Relativity, on the other hand, is a valid theory, because it is testable, the results came in, proving it right. If different results has come in, the theory would have been proven wrong.

I think the same of course, can be said about those who remain faithful to Ayn Rand’s Objectivism, or who remain staunch believers in free market capitalism, even after the recent troubles of the American economy. Whatever the facts, they will find some way to make them fit the theory.

One of the biggest problems I have with Rand and Marx is this implicit (and sometimes explicit) claim to inevitability. I don’t think anything is inevitable. I know that many, perhaps most Marxists, abandoned inevitability by the 1930s, including, Sidney Hook, who attempted to meld Marxism with John Dewey’s pragmatism in his 1934 essay “Communism Without Dogmas.” I would argue that by abandoning inevitability, these “Marxists” had actually abandoned Marxism entirely, and tweaked it save the theory, as Popper’s critique noted.

Because, annoyingly for them, history got in the way. As I just said, I don’t think anything is inevitable, and I don’t think that Marx is to be blamed for the gulag. Nonetheless, with all the horrors of the 20th century, from Stalin’s Soviet Union to Mao’s China and many others in the name of some kind of scientific socialism, Marxists, if not Marx, have a lot to answer for.

So too do the Randians today, some of whom (Paul Ryan, Rand and Ron Paul, Glenn Beck, and so on) simply ignore her militant atheism (as Burns recounts, she once told William F. Buckley that he was “too intelligent to believe in God”). More significantly, many of Rand’s adherents ignore her inability to deal with historical reality and economic facts.

But I think the basic similarity between Rand and Marx comes in their misjudgment of human nature. Rand, as a hyper-individualist, had absolutely no sense of the joys of human love and companionship (hence her unfulfilling marital life, substance abuse, and chronic depression), the warmth of community, and most famously, the dignity of altruism. Indeed, she despised fellow libertarians Friedrich Hayek and Milton Friedman because they argued that libertarianism was actually good from a utilitarian standpoint, that Adam Smith’s invisible hand would bring the greatest good to the greatest number. Rand didn’t care about that. She thought altruism was wrong, plain and simple. People should act selfishly and only selfishly, no matter what happened to anyone else. Not only did she think Christianity led to socialism, or at that it basically was socialism, she believed that self-sacrificial altruism, the very essence of Christianity (Jesus didn’t die for his own sins, but for yours), was immoral.

Rand seems to advocate the basic philosophical principle of psychological egoism, without any awareness of its simplicity and flaws. Psychological egoists say: “people are selfish because they always do what they want,” without taking into account that what people want differs greatly. Some people want to work in soup kitchens, others want to be investment bankers, still others want to be axe murderers. Each are doing what they want, but we can evaluate their desires as having different moral standings.

Marx went the other way. First, his community is too large: he has no use for ethno-cultural particularism, gender solidarity, or anything that moves beyond class. Second, his philosophy does not understand the thoroughly strongly individualistic aspect of human nature. Sure, Sidney Hook (pictured below) tried to argue against that proposition:

Communism is hostile to individualism, as a social theory, and not individuality, as a social value. It seeks to provide the material guarantee of security without which the free development of individuality or personality is an empty or impossible ideal. But the free development of personality remains its ideal; difference uniqueness, independence, and creative originality are intrinsic values to be fostered and strengthened; and indeed one of the strongest arguments against capitalism is that it prevents these values from flourishing for all but a few.

I’m not sure this distinction is true in theory, as Marx has no use for individual expression that derived from national or ethno-cultural traditions. In practice, it has meant even less. Experiments in socialism have often bred uniformity, with Mao’s cultural revolution perhaps the most egregious example, and the limits placed on Soviet art a close second. I think one can argue that strong welfare states in a capitalist context allow for a good amount of “material security” along with the “free development of personality.”

Furthermore, Marx and Marxists discount the importance of individualism, not just individuality, to human beings, who often do place their first loyalties to themselves and to their families, well above class and community. Indeed, this little ditty my father taught me may provide more insight into class relations and human nature than anything Marx or Engels or other Marxists theorists ever wrote:

The working class, can kiss my ass, I’ve got the foreman’s job at last.

Again, I do think much of Marx is valuable, and inspirational, orders of magnitude more than Rand. But like Rand, historically it doesn’t hold up, and politically it seems to contradict human nature as I understand it. Which is why, much as I think pragmatism is a silly philosophy with which to pursue scholarship (I believe in objectivity, but not Objectivism), I think it’s useful, or dare I say, pragmatic, when it comes to politics. It allows for the flexibility to change your opinion, to make compromises, to account for new evidence and realities. Of course, not all compromises are good, and principles are important too, which is why I support a progressive, principled pragmatism.

I think one can do this and remain on the left. One can remain committed to left-wing policies and politics without adhering to any sort of Marxism. Tony Judt will be remembered as a leading advocate of social democracy. Yet some on the left often forget that he cut his teeth as a STAUNCHLY ANTI-MARXIST thinker, criticizing French Communists who ignored, downplayed, or apologized for Stalin’s crimes.

My point here is not to venerate pragmatism or Tony Judt’s political views, both of which have their flaws. My point is simply to say that one can uphold progressive politics and fight the legacy of Ayn Rand without succumbing to the philosophy of her much smarter, much more moral but similarly dogmatic and messianic alter ego, Karl Marx.

Written by David Weinfeld

February 6, 2011 at 15:02

In which I Disagree with Paul Krugman

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By Wiz

The Krugmonster writes:

The root of our current troubles lies in the debt American families ran up during the Bush-era housing bubble. Twenty years ago, the average American household’s debt was 83 percent of its income; by a decade ago, that had crept up to 92 percent; but by late 2007, debts were 130 percent of income.

All this borrowing took place both because banks had abandoned any notion of sound lending and because everyone assumed that house prices would never fall. And then the bubble burst.

Now its true that I’m still waiting for my Nobel prize in economics (next year, I think), but I would say that Krugman’s interpretation of why households have so much debt is a bit simplistic. 30 years of wage repression, union-busting, and off-shoring; combined with an explosion in the costs of health care, education, and (until recently) housing, is the true reason for this household debt. The credit card and mortgage industries played a part, by functioning to conceal the fact that the neoliberal turn mandated lower living standards for most Americans, and allowing people to continue to live a similar lifestyle as before. But the financial industry wasn’t the root causes, even if it profited by parasitically exploiting the situation. Easy credit was the “how” but not the “why” of the crisis, if that makes sense.

Which is to say. Go watch David Harvey.

Then go read this hilariously pathetic neoliberal tripe post which Ezra Klein sympathetically links to, which claims that the crisis is the result of “Republican and Democratics [sic] administrations that were more concerned with punishing innovative industries and ladling on additional security and economic regulations.” Yes! If only we have provided more tax-breaks to pharmaceutical companies or eliminated OSHA regulations. That would have averted this crisis! To paraphrase Marx, when the neoliberals are confronted with a crisis they flee from economics to seek refuge in (corporate welfare for) organic chemistry.

Update: Check this out from Kevin Drum:

However, their introduction is pretty easy to understand: they’ve constructed a simple model for financial crises that essentially proposes the following narrative:(a) growing inequality produces less money for the middle class and more money for the rich, (b) the rich loan much of this money back to the middle class so they can continue to improve their living standards even with stagnant incomes, (c) the financial sector balloons to mediate all this, and (d) the system eventually collapses since, after all, this kind of thing can’t last forever

Written by Peter Wirzbicki

December 13, 2010 at 12:12

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