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leberwurst proletariat

Tag: keynesianism

The Money Theory of the State (Merchant, 2021)

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Reflections on Modern Monetary Theory

by Jamie Merchant, Feb 2021, Brooklyn Rail: Field Notes

“No domination is so easily borne, even so gratefully felt, as the domination of high-minded and highly educated officials.”

— Georg Friedrich Knapp1

Kafka’s unfinished final novel, The Castle, can be read as a parable about the misrecognition of power. In the course of trying to discover if he has, or has not, been appointed as a land surveyor by the local authorities, the protagonist K. becomes obsessed with the authorities themselves, the officials of the great castle whose shadow looms over the village below. Its bureaucrats cut nearly superhuman figures, working tirelessly day and night on countless cases while keeping track of innumerable files with an otherworldly zeal that overawes K. and the villagers, who respect and even revere them. Over the course of the narrative, though, it becomes evident that all this strenuous paper-pushing might be completely pointless, directed to tasks they may never complete, involving problems and questions that cannot be resolved or perhaps never existed in the first place—including, probably, K.’s appointment. The officials might very well have no idea what they are doing, or they might be useless drones, working themselves to death toiling away in busy work that never goes anywhere. But for K. this is unthinkable. For their prestige flows from the impersonal rule of the mechanism, the calcified, methodical, formal procedures that, as in a cage, enfold and dominate the officials and the villagers alike. K. deploys his own formidable powers of reasoning to penetrate their mysteries in his quest to gain permission to enter the castle. But the more he learns, the more he calmly reasons and deduces the state of affairs with impeccable logic, the more transfixed he is by the officials’ cabbalistic aura, the more entangled he becomes in their byzantine networks of influence, and the more he effectively dominates himself.

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Serfdom in a Free Society (Mattick, 1946)

by Paul MattickWestern Socialist, Boston, USA, September 1946

The Road to Serfdom. By Friedrich A. Hayek, University of Chicago Press, 1944 (250 pp.; $2.75).

Full Employment in a Free Society. By William H. Beveridge. W. W. Norton & Co., New York, 1945. (429pp; $3,75).

Both these books are dedicated to the “socialists of all parties.” Hayek wants to discourage them, Beveridge tries to offer encouragement. Both writers speak in the name of science and deal with the reality of, and the need for, capitalistic planning. But what appears to Hayek as the road to serfdom seems to Beveridge the highway to a free society.

Russia and Germany prove to Hayek that socialism does not lead to freedom. The most important guaranty of freedom, he maintains, is a system of private property. Planning and freedom cannot go together. Without a labor market and an industrial reserve army, for example, discipline can be maintained only by corporal punishment, for which reason socialism implies slave-labor. The “collective freedom” of which the planners speak is, in Hayek’s opinion, “but the unlimited freedom of the planner to do with society what he pleases.”

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Irrational Expectations

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by Geoff Mann (Viewpoint, April 2020, PDF)

However much upheaval the global COVID-19 pandemic has generated, a great deal more is coming. The economic disaster is already the object of frantic analysis, much of which tells us we can expect a bottom that matches or exceeds the Great Depression of the 1930s, at least as measured by conventional economic indicators like GDP, unemployment, and bankruptcies. This narrative provides the backbeat to the competing attempts to organize our attention during the passage through present and future trials.

While we are endlessly reminded that “we are all in this together”—a blatant act of false solidarity—many have also pointed out that we were never “all in this together” before the pandemic, we are not now, and it is quite possible we will emerge from this even less together than we were. At least in terms of wealth and income inequality, the prospects do not look good. The relatively well-off will weather the lockdown more comfortably and without the threat of eviction, debt default, and hunger, and they will return to better-paid and stable work more quickly.

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Market Social Democracy: The Transformation of the SPD up to 2007

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Vote share for the SPD across Germany in the 2017 federal election

by Oliver Nachtwey (2013)

The article analyses the changes within German social democracy up to the passing of the SPD’s new party programme in 2007. It argues that social democracy has transformed itself from Keynesian into ‘market social democracy’. The comparison takes place by means of a policy analysis in the fields of labour and social, as well as financial, policies. Furthermore, the policy comparison facilitates an analysis of the rationality of the political economy on which these policies are based. It demonstrates that market social democracy represents a reconfiguration of the relationship between the market, the state and the individual, one that renews the social realm with elements of economic liberalism. This process is also reflected in the new party programme, which now includes basic assumptions of German ordoliberalism. [READ PDF]

The economics of Luther or Munzer?

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by Michael Roberts (TheNextRecession)

Last week leading leftist economists in the UK held a seminar on the state of mainstream economics, as taught in the universities.  They kicked this off by nailing a poster with 33 theses critiquing mainstream economics to the door of the London School of Economics.  This publicity gesture attempted to remind us that it was the 500th anniversary of when Martin Luther nailed his 95 theses to the Castle Church, Wittenberg and provoked the beginning of the Protestant reformation against the ‘one true religion’ of Catholicism.

The economists were purporting to tell us that mainstream economics was like Catholicism and must be protested against as Luther did back in 1517.  As they put it, “Economics is broken.  From climate change to inequality, mainstream (neoclassical) economics has not provided the solutions to the problems we face and yet it is still dominant in government, academia and other economic institutions. It is time for a new economics.”

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