Coffs Coast Business, Politics

The global economy needs to work for people, not the other way around

Three new books reveal the same picture: the global economy is shattered. They suggest how a more people-focused approach than capitalism might alleviate poverty and encourage jobs

By Joanna Kavenna

IN 2016, the UK voted to leave the European Union. Since then, the country has been in crisis. Talk has been of virtually nothing else. Then there is the talk about the talk. “To say the present era is one of crisis borders on cliché,” writes Aaron Bastani in his polemical manifesto Fully Automated Luxury Communism.

What else could he say, given the situation? This grim picture is expanded on in two more books. In Measuring Poverty Around the World, Anthony Atkinson wrestles with the fact that even as countries become wealthier, poverty remains entrenched. And David Blanchflower’s central theme is the crisis of underemployment and underpayment, yet his title Not Working expresses a more general failure of the global economy as well.

Since the end of the cold war, Atkinson writes, “the attitude of Western democracies has been that their view of the world’s political organisations has triumphed”. Bastani calls this “capitalist realism” – the idea that capitalism is the only plausible system – and cites political scientist Francis Fukuyama’s influential argument about reaching the end of history. Yet, in 2008, history returned.

As Blanchflower puts it, “something horrible happened”. All three authors agree that the current malaise derives from the financial crisis of 2007-8, and the cataclysmic mishandling of its aftermath by those in power.

Blanchflower was among those who were tasked with handling the crisis. He was serving on the Bank of England’s Monetary Policy Committee and told everyone that austerity would make things worse. Nobody listened.

Instead, George Osborne, then the UK’s chancellor of the exchequer, “a reverse Robin Hood”, seized a “unique political opportunity… to reduce the size of the state and never mind the social and economic consequences”. Internationally, a perverse illogic prevailed, as US talk show host Stephen Colbert pointed out at the time: “We have to keep cutting government budgets and laying off people until those people get jobs.”

More than a decade on, people are still hurting. They often can’t find employment, or the scant work they can find offers little security or pay. They have no prospect that their living conditions will be ameliorated. Rightly, many of these people blame the “learneds” who failed to predict the crash. For example, a limo driver told Blanchflower that people voted Brexit because “ordinary people had no hope”. How can we have hope when policy-makers haven’t learned from their mistakes?

Worse, as Blanchflower says, these policy-makers “now have little firepower to deal with the onset of the next economic crisis”. If you are already despondent about the situation, I guarantee this book will make you feel worse.

How can we have hope when policy-makers haven’t learned from their mistakes?

Atkinson, too, refused to sugar-coat his subject. Sadly, he died before finishing this book, but it has been brought to publication, at his request, by his colleagues John Micklewright and Andrea Brandolini. With its unfinished chapters explored in afterwords by economists François Bourguignon and Nicholas Stern, it is at the very least a worthy successor to Atkinson’s 2015 study Inequality: What can be done?

Atkinson became an economist in the 1960s after working with deprived children in Hamburg, Germany, and published major works, beginning with The Economics of Inequality in 1975.

Five decades on, says Atkinson, poverty remains “one of the two great challenges facing the world as a whole today, along with climate change, with whose consequences poverty is intimately connected”.

Atkinson considers various definitions of poverty, but his fundamental argument is that the free movement of capital, combined with governments’ failure to regulate and tax multinationals, has led to the loss of employment and to insecurity among workers and their families in many countries.

He agrees with Blanchflower and Bastani that this is a failure of the learneds: “Our governments have lost sight of their obligation to act on behalf of all their citizens; they have allowed them to become subservient to economic forces.” And he argues that “we need to return to a situation where ‘the economy’ is a means of fulfilling the life hopes and ambitions of people, not vice versa”. Wise words, but is anyone able to listen?

Atkinson and Blanchflower find that people want to work to earn money, and that having decent, fulfilling jobs makes people happier. Bastani argues that people would be even happier if they didn’t work at all. He proposes that we need to move from crisis to utopia – to “a world beyond jobs, profit and even scarcity”. This is the “fully automated luxury communism” of his title.

Future robot deliveries will bring further challenges to the workforce

“How can we have hope about the future when policy-makers haven’t learned from their mistakes?”

Bastani evokes Karl Marx’s idea that automation will create “a society in which work is eliminated, scarcity replaced by abundance and where labour and leisure blend into one another”. Robots will do physical tasks such as driving and delivering things. We will “mine the sky” thanks to Elon Musk’s innovations in conquering the final frontier. Life expectancy will be enhanced by gene therapies. Our expanding population will be fed by cultured meat. The new populism will be “luxury populism”: socialist and environmentally aware.

In Bastani’s view, Marx was let down by the technological insufficiencies of every era prior to ours; this is the first time our technology has been sufficient to give rise to a post-scarcity economy, if we want it, and a realm of plenty “beyond imagination”.

What Bastani doesn’t quite imagine, however, is a world in which people might actually enjoy their work. Where in Bastani’s utopia is the place for someone whose version of socialism is more William Morris than Karl Marx, someone who values work as an end in itself?

Like Blanchflower and Atkinson, Bastani identifies elite learneds as the source of our ills. And for his luxury communism to work, these elites have to agree not to pocket the trillions they stand to make but, instead, to share the profits.

What happens if Musk doesn’t “want it”? Maybe he is happy with the way things are. Regardless, there will be no storming of the Winter Palace in Bastani’s utopia, because, he writes, his politics “recognises the centrality of human rights, most importantly the right of personal happiness”.

Bastani’s future is interesting: “a figurehead of possibility forged for a world changing so rapidly that new utopias are needed – because the old ones no longer make sense”. It is a dream to replace the bankrupt capitalist dream, and to counter the dark fantasies of non-luxury populists.

These authors understand that there has been a lot of talk already. They believe we need better talk. They are all highly intelligent people who are trying to understand why the situation in which we find ourselves is so stupid. Their books all have virtues, but if you can only face one, then, for mea culpas and an honest if demoralising insider view, read Blanchflower. For devastating statistical analysis, read Atkinson. For riotous techno-optimism, read Bastani.

It is a wonder Bastani missed the opportunity to call his theory Totally Automated Luxury Communism, or TALC. TALC, which we could liberally sprinkle across our broken world. TALC to mitigate all the TALK.

Not Working: Where have all the good jobs gone?

David G. Blanchflower

Princeton University Press

Fully Automated Luxury Communism: A manifesto

Aaron Bastani

Verso

Measuring Poverty Around the World

Anthony B. Atkinson

Princeton University Press


First published at New Scientist – 31 July 2019. See: https://www.newscientist.com/article/mg24332412-900-the-global-economy-is-broken-it-must-work-for-people-not-vice-versa/#ixzz5vs4UK0A9



One Comment

  1. TERRIFIC ARTICLE. I need to read this one, reflect and absorb. THANK YOU SO MUCH Coffs Coast Outlook. Articles like this one open our minds and make us think about the world we have created and the world we could bequeath to our descendants. THANK YOU. Janne C Lindrum

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