Book Review: The Economists’ Hour by Binyamin Appelbaum

This is an important book on two levels. First, it explains the various economic ideas most people do their best to avoid dealing with in a way accessible even for those of us whose eyes tend to glaze over at mere mention of the subject. Second, it provides information for those only just learning about the mess neoclassical/neoliberal economics has created—a field guide, if you will, to how we got here, and who drove the bus everyone except the 1% has been systematically thrown under.

It’s become common wisdom to blame the paralyzing level of wealth inequality on the Republican—i.e., “conservative”—party, in particular because of Grover Norquest’s infamous “Taxpayer Protection Pledge” that intended to “make the government small enough to drown in a bathtub”.

The man usually given credit for moving the US economy into neoliberalism is Milton Friedman. However, while he is unquestionably the progenitor of modern free-market capitalism, it was his colleague George Stigler who introduced the rabid anti-regulatory element that’s created the modern oligarchy, a position even Stigler’s most important apostle, Sam Peltzman, referred to as “propaganda”.

It was Stiglitz who tilled the soil in the hallowed halls of Congress and the Oval Office that left the federal, and later state, government amenable to the gospel message that competition is superior to regulation for controlling market behavior. The message took hold just as Ronald Reagan took office. The result, unfortunately, we saw too clearly in 2008*.

The problem with neoclassical/neoliberal economics, this excellent and easy-to-read history of the movement suggests, isn’t that the theory doesn’t work. On a limited level, it does. However, the moment it became married to politics, in a country where profit is sought at any cost, it became more like religious dogma, and so not subject to question. Academic certainty became academic arrogance as the Chicago School economists went from being high on ideas to being drunk on power, refusing to accept any data that refuted their fixed beliefs.

They had the right audience, given our culture defines success solely in terms of material wealth. As a result, the converts adhere to the basic tenets of neoliberalism—limit money, cut taxes and government spending to the bone, limit or preferably eliminate regulation, support free trade and unrestricted investment, limit inflation to no more than 2% by manipulating interest rates—despite there being no only no evidence such a system is sustainable but in the face of mounting evidence it’s driving us to disaster.

And why not? It’s a system that works perfectly from those in a position to benefit from it. It’s as though a gang of thieves announced stealing was the only way to run the economy then eliminated all the laws against stealing except the ones that prevent the majority of the non-thief population from doing so.

*For an excellent, if slightly more technical, analysis of how this happened, I recommend ECONned by Yves Smith.

Disclaimer: I received an advance review copy of The Economists’ Hour from the publisher, which I found very flattering since I hadn’t requested it. I’m pleased I can unequivocally recommend it.

Book Review: Shattered by Jonathan Allen and Amie Parnes

Reviewing a book about the Hillary Clinton Campaign only a few months before the primaries to select the candidate for the 2020 Presidential campaign begin might seem to qualify for the Day Late Dollar Short Award. However, in the run-up to those primaries the Democrat Party establishment is repeating many of the same talking points they used against Sen. Bernie Sanders during the 2016 event. Perhaps more important, the Party seems determined to repeat the mistakes it made then. That makes this book quite timely as a reference.

Both the authors make no pretense they didn’t prefer Ms. Clinton over Sen. Sanders, and they work for Politico and The Hill, neither of which is particularly friendly to progressive ideas. However, they are able to get past it for the most part and report the facts instead of justifying or glossing them over. That said, they still can’t refrain from using the kind of violent terms the Clinton campaign applied to the Sanders campaign, words like “rage” and “attack” that in no way describe the way he talked about and to his opposition. Instead, he’s portrayed as a disruptive wannabe unqualified to challenge someone with Clinton’s credentials, which tends to get irritating to anyone who actually paid attention.

What they reveal, perhaps without meaning to, is the simple fact that Clinton, whether because ambition replaced her common sense or simply because of a high level of self-entitlement, comes across as a woman both uncomfortable outside her personal circle of selected friends and arrogantly dismissive of opinions that countered her own.

That her campaign staff acted like eager courtiers willing to do anything to win a moment of their monarch’s attention likely wasn’t helpful when it came to dealing with a hardcore experienced showman like Donald Trump. It’s no wonder people who voted for Obama flipped to vote for The Donald—they’re hypersensitive to precisely the kind of superior attitude Hillary Clinton exuded, and they rejected it.

One of the biggest points of contention during the primaries was Ms. Clinton’s refusal to publish the texts of her well-paid speeches to various Wall Street corporations, speeches her team apparently begged her not to make. According to the authors, she considered them irrelevant. That was her attitude toward her party’s traditional voter base, blue-collar working people, as well. It’s telling that even when, at the end, her husband warned her she was making a mistake to ignore them, she couldn’t bring herself to hobnob with the hoi polloi. She sent Bernie instead.

Ironically, in their efforts to present their subject, the authors seem equally unaware how ruthless and arrogant she comes to appear, qualities they try to convince us are strength and determination. What is also clear is that Ms. Clinton was extremely uncomfortable with large crowds of the sort her primary opponent drew, usually limiting her “rallies” to carefully limited gatherings. That was one of the reasons offered as to why she became convinced she could win by relying on data instead of politicking.

Now, going on four years later, it appears the Democrats are prepared to implement the same strategy they used in 2016, albeit making a broader effort at a pretense of progressivism. It’s as if they convinced themselves Sanders voters were simply enthusiasts who would lose interest in the changes Sanders proposed once the reality of a Trump administration set in. It’s precisely the same kind of mistake they made before, if the story in Shattered is a reflection of the truth.