“Hegel remarks somewhere that all great world-historic facts and personages appear, so to speak, twice. He forgot to add: the first time as tragedy, the second time as farce. […] Men make their own history, but they do not make it as they please; they do not make it under self-selected circumstances, but under circumstances existing already, given and transmitted from the past. The tradition of all dead generations weighs like a nightmare on the brains of the living. And just as they seem to be occupied with revolutionizing themselves and things, creating something that did not exist before, precisely in such epochs of revolutionary crisis they anxiously conjure up the spirits of the past to their service, borrowing from them names, battle slogans, and costumes in order to present this new scene in world history in time-honored disguise and borrowed language. […] The social revolution of the nineteenth century cannot take its poetry from the past but only from the future. It cannot begin with itself before it has stripped away all superstition about the past. The former revolutions required recollections of past world history in order to smother their own content. The revolution of the nineteenth century must let the dead bury their dead in order to arrive at its own content. There the phrase went beyond the content – here the content goes beyond the phrase.”
The Society for the Advancement of Socio-Economics is the leading global scholarly organization of economic sociologists and political economists, studying various interrelated social, political and organizational aspects of markets, economies, businesses, and policies. SASE’s annual meetings are always intellectual fetes because of the richness of insightful contents and illuminating researches, as well as a warm stimulating atmosphere. The upcoming, promising SASE conference “After Covid? Critical Conjunctures and Contingent Pathways of Contemporary Capitalism” will be taking place online on July 2-5, 2021. The conference program is extraordinary and abounds in hundreds of excellent sessions, as part of dozens research networks and thematic mini-conferences. That’s why I was especially glad to hear that SASE opened auditor registration for the conference. This is a really special opportunity to get exposed to cutting edge knowledge in economic sociology, political economy, and related disciplines. So I urge youto attend the conference as an auditorand share this opportunity with your colleagues, students, and friends. See you (virtually) there!
Dear ES/PE community members, after a short intermission (thanks for your kind inquiries!) — we are back. Find below a list of great academic opportunities: 15 calls for papers for conferences and special issues, 8 summer schools, 6 job openings, 5 PhD fellowships, a postdoc position, and an award in economic sociology, political economy, and related fields, with June 30 – July 31 deadlines. Share this post with your colleagues and students. Good luck!
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You might think the U.S. would be world champion of household debt, yet the highest private indebtment has always been in the Nordic countries. Debt, however, takes different forms. In Scandinavia, inclusive welfare systems make debt into an investment. Elsewhere, gerontocratic welfare and consumer credit can become a burden.
Debt and welfare: a trade-off?
Figure 1: Quantity of household debt
The economic crisis of 2007–2008 put household debt in the spotlight. A common narrative was that cheap credit fuelled a house price bubble in the US. The financial industry sold derivatives based on those debts and many European banks who bought those products went belly up, allowing the crisis to spread across the Atlantic. Debt, and in particular, household debt, has been regarded with suspicion ever since. Many scholars argue that the rise of household debt was caused by welfare retrenchment, suggesting a trade-off between welfare and debt. A lack of welfare was compensated by private leveraging. Other scholars pointed out that many governments were pushing for asset-based welfare – like buying housing as a form of private welfare – encouraged by steadily rising house prices in the years preceding the crash. Yet empirical data suggests that the welfare-debt trade-off may be mistaken. Curiously, the highest indebtment ratio in the OECD was, and is, in northern European countries such as Denmark, Norway, Sweden and the Netherlands (see Figure 1). These are the countries with the most far-reaching welfare programmes, and known to be fiscally responsible. Clearly, the welfare-debt trade-off theory needs a rethink.
Private debt, public virtues: on the age-orientation of welfare
Is it, then, a complementary relationship? Generous welfare provides security, encouraging people to borrow more. But this interpretation does not fly either. Many European countries have generous welfare – France for example, has higher social spending than Denmark – but nowhere near the level of household debt of the Nordic countries. My research on the relations between welfare and household debtoffers a novel explanation of the welfare-debt conundrum. There is no trade-off between private debt and welfare, nor is there a complementary relation. What matters is where the welfare money is spent and how. It isn’t necessarily about the quantity of spending, but about its direction. Most welfare spending is concentrated on older generations, particularly retired people. According toModigliani’s life-cycle hypothesis, debt is linked to one’s stage in life. People take on debt when young because their income is low but their expenses (housing, children, leisure) high – and they pay this debt off as they age. Countries that not only provide social help for the elderly, but counterbalance that with spending and services for the young and economically active, tend to have higher private debt (see Figure 2). In particular, countries that spend on education and active labour market policies, and those which offer better protection for people in precarious jobs, have the highest levels of private debt. Household debt is an unintended consequence of assuring a smoother transition to adulthood. In conservative continental European countries, however, despite high welfare spending, welfare is concentrated mostly on the elderly and on people with stable jobs. This discourages younger generations from taking risks, including mortgage debt.
Figure 2. Quantity of household debt by the age orientation of welfare spending in OECD countries. Note: it illustrates an inverse relationship between the elderly orientation of social spending (EBiSS, on the x axis), and the quantity of household debt as % of net disposable income (on the y axis). The EBiSS is a rate between social spending for the economically active (at the numerator) versus spending oriented toward the elderly (at the denominator). A higher value on the EBiSS index means that a greater share of social spending is going to the elderly.
Consumer credit? The three worlds of debtfare capitalism
Most of the debt in OECD countries is mortgage debt. While mortgages are a marker of privilege, another common type of debt, consumer credit, is often a marker of need. If we consider consumer credit, the welfare-debt theory makes sense again. While consumer credit is more the exception than the norm in Europe, and almost absent in the Nordic countries, it is common in Anglo-liberal countries (UK, US and Canada) where it is used by families as a substitute for poor welfare provision.
Figure 3 shows three main patterns of private debt/welfare configurations; what we call debtfare: 1. In the Nordic / youth-oriented model, household debt is high, consumer credit is low, and the rate of young people Not in Education, Employment, or Training (NEET) is very low. 2. In conservative European countries such as Germany and Italy, there are a lot of NEETs, welfare is orientated toward the elderly, and there is little household debt or consumer credit. 3. In Anglo-liberal countries such as the UK, US and Canada, consumer credit is high, and so is overall debt (though not as high as in the Nordic countries). The share of NEETs is remarkably high, and most welfare is oriented toward the elderly. Household financialisation, then, follows different paths and patterns. Both liberal and conservative welfare is gerontocratic, and they have a high level of NEETs, but while the former is oriented toward a market solution to inequality (more debt), the latter discourages any form of risk taking. So, while paying attention to debt is important, it shouldn’t be the only lesson of the 2008 crisis. Further attention should be paid to the macro-sociological conditions that give debt different meanings: inclusive welfare can make debt into an investment, but gerontocratic welfare can make debt a burden. ————— * Martino Comelli is PhD Candidate in Political Science at Central European University. His academic interests include household debt, social policy and economic sociology. This article was originally published on The Loop – ECPR’s Political Science blog.
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Eventually we see genuine, intra-academic and professional self-reflections! 😉 Locate the category you belong to, and share this with your colleagues and students! 🙂
While Maxim Ananyev boldly exposed above the affluence of economics knowledge, Kieran Healy offered below his own subtle observation regarding sociological articles.
Of late, numerous liberal, right-wing and even some leftist journalists, academics and politicians have readily embraced the prism of “leftist identity politics”. More often than not, they have done so under the cloak of liberal universalism by freely exhibiting their ignorance or indifference on matters of institutional discrimination and forms of oppression resulting from social injustice, racism, and patriarchal structures. In defiance of established facts and figures, they disregard or trivialize the existence of structural racism, racist death threats, physical violence against and the murder of people of color (POC), women, LGBTQ+ people, the homeless and antifascists. They also close their eyes to the necessity of both safe spaces and social mobility for discriminated groups and subaltern classes. Instead, they invoke the supposed perils of “woke cancel culture”, “feminist language police” and dangerous “POC mobs”. But, in recent years, there have also been heated debates in leftist circles regarding the primacy of class versus race and/or gender issues. Orthodox leftists often suggest that the category of class constitutes the primary contradiction as it goes beyond special interests and group identities. Many heterodox leftists, however, regularly speak for the priority of race and gender problems and reject the notion that these categories merely pose secondary contradictions. Nonetheless, things are more complex, complicated and dynamic than these simple juxtapositions are able to disclose and very much depend on the specific spatio-temporal context. In the following, I will argue that questions of race and class are distinct but intertwined. For that purpose, I will first compare the conditions of enslaved blacks in antebellum America with those of white textile laborers in 19th century England. Secondly, I will look at the role of Euro-American colonialism, imperialism and its non-white beneficiaries and collaborators. Last but not least, I will shortly touch upon some of the prevalent relations and socio-economic conditions of white and non-white, citizen and non-citizen wage laborers within contemporary capitalism. Now, let us briefly delve into an historical comparison of two of the most exploited groups across the Atlantic during the period from the late 18th– to the mid-19th century: the enslaved black laborers of American plantation economies and the wage laborers of England’s textile factories. To begin with, enslaved captives were reduced to property and when sold to European slave traders, they were converted into commodities. Subsequently, they became integral parts of the productive forces of plantation owners. During periods of high labor demand and low slave supplies, their lives were more precious in monetary terms than many of their poor white counterparts. Whereas black captives were often insured (similar to other valuable assets) and had enough food not to starve, they were yet “legally dead”, that is, without rights, and thus exposed to horrendous physical and psychological violence of the sort from which white laborers were generally spared. By contrast, it wasn’t uncommon that the so-called wage slaves of early industrializing Britain, especially women and children, had longer working hours than their de facto and de jure enslaved counterparts and frequently died of malnutrition. At the same time, white British men (and to some limited degree also women) were legally free persons who – at least in theory – could sell their labor power to whomever they wanted. Nonetheless, in the 19th century, both American captive slaves and British wage laborers were refused basic rights. Obvious differences notwithstanding, enslaved captives in the US antebellum south and wage laborers in Lancashire cotton mills had more in common with each other than with the indigenous power houses, white masters and capitalists who sold, dominated and suppressed them. During the very same period – although the vast majority of plantation owners were white – there were also free POC (gens de couleur libres) and black slave owners, as in late 18th century Saint-Domingue (Haiti), for example. West African elites also made considerable profits through selling captives to European slave traders. To be sure, Euro-Americans became the undisputed rulers of the global 19th century and violently exploited large swaths of the world through colonial subjugation. Significant portions of the Euro-American wealth and capital that was accumulated between the 16th and 21th centuries, stemmed from naked force, i.e. the enslavement of 12 million Africans during the Trans-Atlantic Slave Trade, the extermination of indigenous peoples, colonial extraction of labor and resources in Asia, Africa and Latin America and neo-colonial wars. Although regime change operations in countries such as Afghanistan (since 2001), Iraq (2003-2011), Libya (2011) and Mali (2013) led to billions in deficits, they simultaneously generated huge profits for the military-industrial complex, especially in the US. Still, Asian, African and Latin American royal families, nobles, politicians, capitalists and other elite members, including the “comprador bourgeoisies”, simultaneously made huge fortunes through tax collection, commerce, production, the sale of natural resources and the conversion of human beings into property. They lived comfortable and luxurious lives at the expense of their predominantly poor and oppressed subjects. Indeed, we shouldn’t forget that the colonization and imperialist exploitation of India, West Asia, Africa and Latin America were also made possible by the collaboration of local Euro-American allies. Now, let us move to the present age. Today, a disproportionately large segment of the Euro-American population of “low-skilled” laborers are people of color (POC) and refugees. They work on construction sites, as temporary agricultural wage laborers, in stores and supermarkets, as care workers, transportation, mail processing and delivery agents, nurses, cleaners and in factories, the meat and warehouse industries. These people form the lion’s share of “essential workers”. Though indispensable, they are also disposable, and on top of that, among those most affected by the raging Covid-19 pandemic. Many of these precarious laborers – who can hardly make ends meet despite increasing working hours – are emblematic of the intersection between class and race. Apart from subminimum wages, a great number of essential workers are heavily monitored and humiliated. Amazon employees, for example, risk losing their jobs if they take breaks to go to the bathroom while temporary migrant laborers, working in agriculture or the meat industry, live in particularly miserable and crowded housing conditions. Thus, it hardly comes as a surprise that, in December 2020, Amazon induced a county in Alabama to change traffic light timing outside the warehouse so that pro-union workers would not be able to canvass workers while stopped at the light. Even in a wealthy country such as Germany, over 20% of the employees work in low-wage sectors out of which about 40% are immigrants and POC. “High-skilled” workers are also hit by austerity policies that have continuously increased in the past 40 years. It is not uncommon that, after six years of study, a prospective psychotherapist earns about €240 per month, while non-tenured university lecturers draw wages of about €20 – often even €3 per hour (without getting allowances for pre- and postprocessing courses taught). In the US too, adjuncts are on the rise and make up about 75% of the academic workforce. They receive between $20,000 and $25,000 per year and have to supplement their income with other jobs in order to survive. Concurrently, there are proportionately small but, nonetheless, substantial numbers of well-to-do middle- and upper class POC both in the “Global North” and “Global South”. They are economically better off than significant segments of the white working classes in Euro-America who have increasingly become unemployed, especially since a good portion of industrial production has been outsourced to Asia. Furthermore, the economic ascendancy and capital investments of Japan, South Korea, China, India, the United Arab Emirates and Saudi Arabia in the US, Europe, Latin America and Africa demonstrate that the antagonisms between the “developed” and “developing” world only explain part of the story. In this very specific context, the statement that the historian C.L.R. James made in 1938 is instructive – though he probably underestimated the significance of processes of racialization: “The race question is subsidiary to the class question in politics, and to think of imperialism [exclusively] in terms of race is disastrous. But to neglect the racial factor as merely incidental is an error only less grave than to make it fundamental.” (James, 2001) To some extent, “white-passing” non-citizens from the peripheries (e.g. from Eastern Europe and Latin America) are more discriminated against than non-white citizens, including black and brown people with passports from the US or European states. These white-passing immigrants are more or less part of the predominantly non-white and markedly rising global reserve army of non-citizens and refugees. In 2020, forcibly displaced persons constituted more than 80 million people worldwide. They are bereft of civic rights, live in abject poverty and work for starvation wages – if they are able to find jobs at all and are not denied their due wages altogether. In the West, it isn’t unusual that these refugees toil on construction sites or as forced laborers (e.g. in prostitution). To give another example, in France, a number of bike couriers, who are affected by wage cuts and work for multinational food supply chains such as Uber Eats and Deliveroo, rent out their mobile work apps to “illegal” refugees, who are often underaged teenagers. In return, they get 30-50% of the refugees’ delivery service wages which are based on piece rates. On the other hand, those non-white Euro-American minorities who possess permanent rights of residence – even when being well-off and highly skilled – are currently more and more exposed to fascist mobs and racist violence and terrorism. For centuries and decades, they have also suffered from fierce police brutality, systematic racial profiling and structural discrimination in the job and housing markets; a normality that white Euro-American populations hardly experience today. As a matter of fact, many black people in the US are permanently at risk of being arrested or killed by the police, more or less irrespective of status and income (even though money and power certainly help to diminish these hazards). Arguably, the different national bourgeoisies the world over often share similar interests. The “labor aristocracies” aside, the same could also be said about segments of the global working classes. Therefore, solidarity amongst POC is not a value by itself but very much depends on the particular context. Indeed, white working-class people are, could and should be considered as potential allies for all types of emancipatory movements, provided that they are not racist, misogynist, etc. and also willing to cooperate. By contrast, it goes without saying that non-white war criminals, dictators, authoritarian rulers and capitalist billionaires – who empower and enrich themselves at the cost of their oppressed and exploited subjects and laborers – can never be part of a genuinely progressive alliance. In short, capturing the in-depth relationship between race, class and gender is an intricate affair. Although these categories are interwoven in a web of intersectional relations, they equally have to be understood independently and on their own terms. On the one hand, it seems improbable that racialization and structural discrimination of black and brown people will significantly diminish as long as current capitalist socio-economic structures and power relations remain in place. On the other hand, empowerment and the improvement of the living conditions of people of color do not automatically lead to less racism as racist ideologies cannot be understood on purely materialist bases. That said, the underprivileged classes in the “developed word” cannot move closer towards emancipation if the majority of people remain in fetters. As Karl Marx succinctly expounded the dialectical relationship between class and race in 1866: “Labor in white skin cannot emancipate itself where the black skin is branded.” ————- * Kaveh Yazdani is assistant professor at the Department of History, University of Connecticut (USA). He previously taught at the Universities of Osnabrueck, Bielefeld (Germany) and Vienna (Austria), and was a postdoctoral fellow in Amsterdam and Johannesburg. His recent publications include the monograph India, Modernity and the Great Divergence (2017) and the edited volume Capitalisms: Towards a Global History (2020).
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Thorstein Veblen’s The Theory of Business Enterprise (1904) is a superb political economy book in which this original economist, talented sociologist and influential intellectual analyzed the growing corporate domination of culture, society and the economy in the US at the dawn of the 20th century. Looking around and thinking about, I recently recalled the following two Veblen’s arguments, which are relevant and acute today as they were 120 years ago. Each era has its own Robber Barons.
“The indirect or incidental cultural bearing of business principles and business practice is wide-reaching and forceful. Business principles have a peculiar hold upon the affections of the people as something intrinsically right and good. They are therefore drawn on for guidance and conviction even in concerns that are not conceived to be primarily business concerns. So, e.g., they have permeated the educational system, thoroughly and intimately. Their presence, as an element of common sense, in the counsels of the “educators” shows itself in a naive insistence on the “practical” whenever the scheme of instruction is under advisement. “Practical” means useful for private gain. Any new departure in public instruction, whether in the public schools or in private endowed establishments, is scrutinized with this test in mind; which results in a progressive, though not wholly consistent, narrowing of instruction to such learning as is designed to give a ready application of results rather than a systematic organization of knowledge… The primary test is usefulness for getting an income. […] There is also a large resort to business methods in the conduct of the schools; with the result that a system of scholastic accountancy is enforced both as regards the work of the teachers and the progress of the pupils; whence follows a mechanical routine, with mechanical tests of competency in all directions. This lowers the value of the instruction for purposes of intellectual initiative and a reasoned grasp of the subject-matter. This class of erudition is rather a hindrance than a help to habits of thinking. It conduces to conviction rather than to inquiry, and is therefore a conservative factor. […] A more far-reaching department of the educational system, though not technically rated as such, is the periodical press, both newspapers and magazines. […] The current periodical press, whether ephemeral or other, is a vehicle for advertisements. […] Publishers of periodicals, of all grades of transiency, aim to make their product as salable as may he, in order to pass their advertising pages under the eyes of as many readers as may be. The larger the circulation the greater, other things equal, the market value of the advertising space. The first duty of an editor is to gauge the sentiments of his readers, and then tell them what they like to believe. By this means he maintains or increases the circulation. His second duty is to see that nothing is said in the news items or editorials which may discountenance any claims or announcements made by his advertisers, discredit their standing or good faith, or expose any weakness or deception in any business venture that is or may become a valuable advertiser. By this means he increases the advertising value of his circulation. The net result is that both the news columns and the editorial columns are commonly meretricious in a high degree.” (Veblen 2016: 222-3).
Dear ES/PE community member, find below a list of great academic opportunities: 10 calls for papers for conferences and special issues, 10 job openings, 6 post-doc positions, 3 PhD fellowships, 3 summer schools, and 3 awards in economic sociology, political economy, and related fields, with April 1 — April 30 deadlines. Share this post with your colleagues and students. Best wishes and good luck!
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The current period of socio-economic development across the globe is featured by the paradigm shift in dominant economic theory similar to the one that took place in 1970-80s. The appearance of Friedrich Hayek’s The Road to Serfdom (1944) sparked a variety of heated debates across the world exhausted by the Second World War, after which the new economic order was established based on extensive state involvement, the elements of centralized planning, and the creation of the welfare state. To oppose these tendencies the group of intellectuals led by Hayek met in the Swiss town of Mont Pelerin in 1947. Thus, the Mont Pelerin Society was set up to ensure both the transmission and diffusion of “free-market” ideology. Activity of such intellectual unit allowed a small circle of utopian thinkers to prepare the ideological, political and economic revenge of laissez-faire capitalism under the label of “neoliberal renaissance”. Now the tide is back: over the last decade serious flaws of the unfettered capitalism have become obvious. Given the existing concerns about rising inequality, low productivity, technological disruption, and lack of space to apply the monetary toolkit, it would be quite reasonable to suppose that the paradigm shift in political economy is on the global economic agenda. According to OECD, which hosts under its umbrella New Approaches to Economic Challenges Initiative, if the world is to address the existing challenges successfully “business as usual is not an option”. The ways to implement economic policy must go beyond the traditional instruments to encompass reform of institutions, social policy and political narratives. IMF Managing Director Kristalina Georgieva speaks openly about “a new Bretton Woods moment”. Moreover, Jeffry Frieden, professor of government at Harvard University, at his article published in the IMF journal Finance & Developmentrecently revealed positions that clearly oppose widely-spread neoliberal dogmas. He argues, for instance, that unilateral trade is practically unheard of, and no country today pursues it. There is also no universal economic cure: policy responses to the COVID-19 pandemic vary from country to country in line with different health, economic and political circumstances. Deeply understanding the importance of political economy theoretical background to facilitate successful economic transformations, one should pay attention to the resonant statement by Neil Fligstein and Steven Vogel “Political Economy after Neoliberalism”, dubbed as Manifesto for New Thinking, in which they presented three core principles of alternative political economy. The first principle: state/government is an important player in economic processes. Government serves as a designer of market infrastructure. For instance, financial centres are believed to exemplify the best practices of free-market and non-restricted competition: to succeed in their development free movement of capital and financial liberalization are necessary components. Government decisions to set up specific legal and regulatory environment were required prior to the establishing of global financial hubs. For example, the “Big Bang” that would become a milestone in the development of the City was triggered by Thatcher’s conservative government: abolishing minimum fixed commissions, ending the separation between those who trade stocks and shares and those who advised investors, allowing foreign firms to own UK brokers, and so on. So it is not surprising that the experts of a well-known British institute Chatham House defined that the post-coronavirus European political landscape could be marked by demands for a new social and economic contract: citizens will expect and demand more of the state. This crisis has the potential to fundamentally shift Europe’s political economy towards a new balance between the state and the market. It would likely emphasize a stronger and interventionist role for the state and reduce openness to market forces. The second principle: politics matters. Political economy should investigate how political and market powers interact proposing the best way to build effective check-and-balances system. Analytical contribution of Artem Gergun on the welfare state development shows the nature of such interaction between politics and economy. This concept may be considered as social trade-off serving to limit and mitigate class conflict, to balance the asymmetrical power relation of labor and capital, and thus to overcome the disruptive struggle and contradictions that were the most prominent feature of pure laissez-faire capitalism. Moreover, such political and economic framework is the byproduct of the coexistence of the two different ways to modernize the society: Western-based free market approach and socialistic experiment led by the Soviet Union. According to Gergun, from the perspective of modernization theory, the industrial development would lead to a post-ideological democratization across the globe. Modernization process would eventually finish ideological and military rivalry between two opposing blocs of the Cold War: industrialized socialist societies would reduce their structural inefficiencies by invoking some of free market practices; and, vice versa, liberal democracies would overcome the drawbacks of laissez-fair capitalism by balancing market failures with enhancing welfare state and social security programs. Following these arguments, each country designed a unique combination of check-and-balances between business, state and labour according to its own specifics. Unfortunately, the paradigm shift towards neoliberal economic ideology in 1970-1980s resulted in the trend of welfare state decline. So, the potentially “win-win” strategy of sustainable development was replaced by a formula of “advanced capitalism minus the welfare state”, having been generating a number of historic battles to forge the particular forms of governance in the economies worldwide. The third principle: no “one-size-fits-all”. Acrimonious discussion, useful to illustrate this notion, have appeared on the pages of Financial Times. The heated debates, for instance, focused on the concerns about the existence of “zombie firms” — corporate businesses that fail to generate enough revenue to make their interest payments on borrowings and have low valuations that suggest moribund prospects. Supporters of free-market ideas appealed to the advantages of Shumpeter’s “creative disruption”: market economies are constantly adapting to new technologies and organizational models, supply discontinuities and other disruptions. Such adaptions and innovations are the primary engines of growth. A Shumpeterian policy avoids the distortions of politically chosen winners that tilt the level playing field against small competitors and disruptive technologies. Another group of intellectuals backed Keynesian approach: economic shocks should be countered by government spending to recover full employment and general equilibrium, including corporate business bailouts. They argued, regarding their opponents’ position, that Shumpeterian approach requires a number of prerequisites to be implementable, including effective safety nets, means for new skills acquisition, etc. Moreover, financially weakest companies are not always the same as the least productive ones. Studies found that in France a surprisingly large share of companies with pandemic-related solvency problems are at the top of their sectors in terms of productivity. Thus, the choice whether to prefer Keynesian or Shumpeterian approach cannot be prescribed by common guidance: it depends on a variety of social factors, the level of institutions development and specific economic profile of each country. To sum up, it is obvious that the period of neoliberal dominance in economic thinking worldwide is nearing the end. New political economy approach will be in line with what the OECD experts called “the sociality of human beings and their embeddedness in social institutions“. So, today’s economists and policy-makers have a unique opportunity to adjust the Mont Pelerin Society heritage to the needs of our time. There are a lot of cozy villages in the Swiss Alps that may host meetings of leading thinkers resulting in the foundation up-to-date intellectual incubators to promote the new political economy agenda. ——- * Vadym Syrota (PhD) is an independent banking expert and former official of the National Bank of Ukraine (central bank) at banking supervision and financial stability departments. He is a regular contributor to the Kennan Institute blog (Woodrow Wilson Center, USA) and numerous Ukrainian business and economic media outlets.
Dear ES/PE community member, see below a list of great academic opportunities: 10 calls for papers for conferences and special issues, 8 PhD fellowships, 6 job openings, 5 post-doc positions, and 4 summer schools in economic sociology, political economy, and related fields, with March 1 — March 31 deadlines. Share this post with your colleagues and students. Best wishes and good luck!
> Don’t you want to attend the most interesting and promising online talks and webinars on various topics in economic sociology and political economy from all over the world? Of course you do! So follow the ES/PE’sFacebook, Twitter, and Linkedin pages, Whatsapp and Telegram channels to have information about these events that are publicized only on our social media several days before they take place.
For as long as neoliberalism – the face that capitalism has assumed since the 1980s – has been showing signs of aging, there has been a tendency to view every crisis as a harbinger of impending epochal change. This is true even for crises that do not originate in the economy or finance, as shown by current debates about the world after Covid-19. The interesting fact is that the sense of doom that surrounds these critical events fuels not only the hope of overcoming the disastrous social model that has dominated these last decades, but capitalism as such, which is hastily defined as “unsustainable” for the inequalities it undeniably produces, the racial injustice it perpetuates, the harm it does to the environment, and so on. Sometimes, these great expectations are fed by utopian theories that treat capitalism as if it were merely an ideology. Ideologies, as we know, are beliefs spread by the ruling classes to justify their privileges. If capitalism is an ideology, it will be enough to demystify it; once the deception is unveiled, people will see the light, is the reasoning of Thomas Piketty. More often, expectations grow in the wake of fantasies of radical change that are harbored independent of any social theory. In this theoretical vacuum, anything becomes possible: human agency is thought to be all powerful. Capitalism can be overthrown, activists tell us. You just have to want it and persuade other people to want it. In any case, as soon as each crisis is over, these hopeful people are faced with the inertia of history that invariably frustrates their desires. This problem prompted me to write Foretelling the End of Capitalism: Intellectual Misadventures since Karl Marx. The book seeks to explain the persistence of capitalism in the Western world by building a more rigorous theory of its dynamics. To understand how capitalism is still around, despite all the troubles it has caused, I perform two related operations. The first is to examine the unfulfilled forecasts of its death that have followed one another since the mid-nineteenth century. Contrary to a widespread perception, these did not emerge from left-wing intellectual circles only but from conservative ones too. It is, of course, important to contextualize social forecasting historically, but also to identify its errors. Using this information, I then get to the second step, which is to outline a theory of capitalism. The theory I am going after should clarify what capitalism is made of, what forces have kept it alive, and possibly give us some clue as to where it is or isn’t headed. We can classify forecasts into four types based on the causal chain they assume. First, there are the implosion theories typical of orthodox Marxism, according to which capitalism would implode because of its economic contradictions. A second group includes the exhaustion theories of the likes of John Stuart Mill and John Maynard Keynes. For these thinkers, capital accumulation would stop at some point due to environmental limits, saturation of material needs, moral or civilizational progress. Next come the theories of convergence that were particularly in vogue in the interwar period and the following years of the “end of ideology.” These stressed how technological development and the trend toward state planning were making capitalism and socialism increasingly resemble each other. Finally, mention should be made of the cultural involution theories associated with Joseph Schumpeter, Daniel Bell, and to some extent Jürgen Habermas. These pointed to the self-defeating character of bourgeois society, emphasizing how capitalism, by breeding its parasites and critics, was undermining its own values while even the political superstructure erected to save the system from itself was prey to disintegrative tendencies. Equally varied is the repertoire of forecasting mistakes. They range from cognitive distortions, or biases in thinking due to well-known limitations of human cognition, to more fundamental theoretical flaws that reflect a misapprehension of the relationships between social realms or involve the use of inappropriate explanatory models. However, there is a factor that seems to have operated at a deeper level and this is the irrational faith in progress that has characterized much of modern social science. In fact, many forecasters shared two attitudes that were both legacies of the Enlightenment: an unshakable belief that the future would bring good things and an equally strong confidence in the capacity of reason to detect laws of historical development. Such laws would enable one to anticipate not only what was or wasn’t reasonable to expect from the future but actually how the future would look like. If the flaws that plague capitalism have not proved decisive for its demise, then should we conclude that its persistence is due to its virtues? The typical explanation of mainstream economics is that capitalism is sustained by its supposed efficiency, thanks to which it also tends to prevail over other systems. I don’t buy this “efficiency view” either. My thesis is that the reasons why capitalism persists have nothing to do with the quality of its fabric but are to be found in the social structure in which it is embedded and that two elements, combined, are involved in its reproduction: hierarchy and individualism. All complex societies are to some extent hierarchical, but capitalist society has inherited from the feudal society out of which it grew some highly asymmetrical power relations. The same dependence created by need that used to bind serfs to their lords now binds food delivery riders to their billionaire exploiters. Capitalism replaced old hierarchies with new hierarchies. It brought about a new category, namely, class, that is still very central to our societies. While social distinctions in the old world reflected status at birth, in the new world they are based on the ability to accumulate money. In this sense, capital led to a reconfiguration of social stratification. Yet, the true element of novelty that accompanied the rise of capitalism, and the one that distinguishes it most, is individualism. People today feel motivated by their preferences, needs, and rights, rather than by the norms and duties that come from belonging to a community. They have relationships mediated by contracts and mainly resort to the market to meet their needs. Over time, this market logic and the underlying profit motive have become increasingly generalized, even extending to sensitive spheres of human life such as work and health care. These hierarchical social structures and individualistic values have taken shape over many centuries and can’t suddenly disappear. If hierarchy has been with us for almost all time, individualism is intertwined with the particular form taken by modernization in this part of the world. In a way, it was the price to pay to be free from oppressive forms of social control and able to make decisions for oneself. Fortunately, however, not all Western societies are hierarchical and individualistic to the same degree, which explains the existence of more or less tolerable varieties of capitalism. For the avoidance of doubt, I do not think that capitalism will go on forever. All social systems in human history have had a beginning and, after undergoing a slow yet relentless evolution, they are eventually turned into something else. There is no reason to believe that capitalism will be an exception. But it won’t die because of any internal contradictions nor just because we want it to. Moreover, if we try to imagine what kind of system could evolve from capitalism in a few centuries, we might not like it either. As Ralf Dahrendorf once observed, the oppressed of one epoch have never become the rulers of the next. Elites have always been superseded by competing elites. That’s why, I think, achieving greater social justice under capitalism should be the highest priority for progressives. As I mentioned at the outset, I wrote this book with an eye for those who dream about big system change. History shows how difficult it is to achieve even small, incremental changes. While it is always good to aim high, one must put their best energies into battles that can be won. Ending neoliberalism, which is only forty years old after all, looks like a more reasonable bet. —————- * Francesco Boldizzoni is Professor of Political Science at the Norwegian University of Science and Technology and the author of Foretelling the End of Capitalism: Intellectual Misadventures since Karl Marx (Harvard University Press, 2020). His previous publications include The Poverty of Clio: Resurrecting Economic History (Princeton University Press, 2011) and Means and Ends: The Idea of Capital in the West, 1500-1970 (Palgrave Macmillan, 2008). (Emphases added by the editor)
Dear ES/PE community member, see below a list of great academic opportunities: 16 calls for papers for conferences and special issues, 6 post-doc positions, 4 job openings, 3 PhD fellowships, 2 visiting posts, and a summer course in economic sociology, political economy, and related fields, with January 31 — February 28 deadlines. Share this post with your colleagues and students. Best wishes and good luck!
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On January 18 — the first day of second semester — senior managers at the University of Leicester (UK) notified dozens of academic staff members and professional employees that their jobs are at risk of redundancy. In the midst of the deadly pandemic, the University, whose motto “So That They May Have Life”, blatantly threatened the livelihood of its most committed and aspiring workers which, for about a year, have been facing exhausting workload. One part of this “Shaping for Excellence” plan — yes, this is how the managers are calling it — aims at ‘disinvestment from research and scholarship in Critical Management Studies and Political Economy‘. This incredible objective threatens at least 16 School of Business academics working in these fields of study. The Economic Sociology and Political Economy global community is shocked by this troubling and disgraceful scheme, strongly condemning it and unequivocally calling to abandon it. This scheme raises serious questions about the process for selecting those potentially affected by the redundancies. It appears that it is on the basis of the content, not the quality of their academic research and teaching, or anything to do with their performance. Moreover, 8 of these 16 School of Business’ faculty members happen to also be union branch representatives. It is shameful that the University of Leicester, that is branding itself as “Citizens of Change”, is targeting elected trade union officials, many of whom also have international and transdisciplinary reputations for their outstanding scholarly contribution. The University of Leicester School of Business has been globally renowned for its critical research, reflexive and socially minded management training, and the excellence of the researchers working in those fields. Indeed, this school was instrumental to the development of these disciplines within UK and EU higher education in general and within business education in particular. If the redundancies occur, then it would throw into doubt the integrity of the School, the quality of its programmes, and competency of the University’s leading figures. In the midst of the chaotic pandemic and enormous economic crisis no serious business school should be settling for “business as usual”. Rather, they should be forging new theoretical paradigms and practical tools for more equal and empowering value creation instead of inserting neoliberal indoctrination about the pursuit of profit. They should be equipping students with the critical perspectives and interdisciplinary knowledge to tackle traditional business assumptions and replace them with ones that better serve the holistic needs of the economy, society, and environment. Indeed it is precisely these broader insights, encompassing Critical Management Studies and Political Economy, that are already being asked for and will be certainly asked for in the post-pandemic era by advisory boards, governments, the private sector, and civil society organizations. Therefore, the ES/PE community firmly requests to abandon this scheme: its timing is brutal, its process is shady, and its substance is more than questionable. It goes directly against the University’s proclaimed commitment to “championing academic freedom” and puts its very essence in danger due to neoliberal-managerialistic myopia of yesterday — instead of embracing path-breaking thinking leading to sustainable tomorrow. The ES/PE community stands in solidarity and supports the University of Leicester branch of the University and College Union in their just struggle against job cuts, defending livelihood and research of their members as well as protecting critical education, professional growth and intellectual development of their students. Please sign this letter of condemnation addressed to the University and circulate this post widely if you want to lend your voice to stopping this assault on academic freedom and political economy scholarship.
