Provocation 52 Deep history and the obscure future.
The awareness of current problems within economics is now widely shared. But how do we get from accurate criticism of the present to a new economic thinking that is different enough to have a chance of making a real difference in the outcomes for society? In recent interviews Adair Turner and Eric Weinstein have called out for truly new thinking. Stieglitz writes:
..we need to rewrite the rules of the economy once again, this time to ensure that ordinary citizens benefit. Politicians in the US and elsewhere who ignore this lesson will be held accountable. Change entails risk. But the Trump phenomenon – and more than a few similar political developments in Europe – has revealed the far greater risks entailed by failing to heed this message: societies divided, democracies undermined, and economies weakened.
While we are clearer about the present mess, we are not clear about
1. How we got here. (The past)
2. What can happen. (The future)
We lack good narratives on how the past got us to the present. I don’t mean narratives such as the housing bubble (ingenuous because all house prices were going up and rents even faster. What were lower income people supposed to do?)
I think of rather different narratives that go much deeper into origins, such as..
Hunter gatherers shared the kill. As they became more sedentary the kill in the field was replaced by the “sacrifice” with ritualized distribution to everyone at the encampment. Herd management was key to early settlements and on into empires. We tend to think of the empires as agricultural, but the place of animals in the food chain and central cultural activity was larger. Cattle were the source and measure of wealth from Mesopotamia to Greece to Rome. Cattle breeding was central to the herd management, and the new head of cattle was named “cap”, latin for head, from which comes capital. Hence modern capital is a direct descendent of breeding in the herd, the use of what we have to produce more. The question emerged of who “owned” the new “head” (Even the word “interest” as from loans, used in Rome and Athens was “tokas“, “offspring”). The leaders of the tribes, as population and social complexity increased, came to be experienced as the. decider about the herd and its use. Sacrifice was still the way the wealth of the community was distributed. The chief’s “ownership” became slowly protected by laws , nomos , as in eco-nomos, (the early Greek Nomos came from the earlier Greek, nomia , meaning distribution). Capital was then and is now is new production, especially production beyond the reproduction rate. Who’s owns that surplus, what could be done with it? (Bride price throughout the Greek and Roman empires, tends to equate breeding and human reproduction. Slaves and cattle were beasts of burden and women were to produce “offspring”. ). These customs protecting the strong leaders in relation to the rest of the community became the regime for handling “cap” down to our own time.
What I like about this is, it suggests possible ways of rethinking “capital” now.
Which gets us to the possibilities for freeing the Imagination to reinvent the future. Imagination needs to be released from its chains of TINA and the implications of treating the economic system as though it is a universal natural system rather than the slow accrual of local opportunities.
We need more imagination because of the complexity of feedback among problems such as Low growth and inequality.
The establishment pushes growth as the solution to both.
The alternative would be a different regime of distribution of income and wealth, which could cope with climate warming but would require really tough decisions and policies. The establishment approach cannot because ir will feel as if we dodged the bullet of redistribution and low growth and fail to take on the tough issues. In a way we are back to herd management, what to do with the new head of cattle, the cap, and now, with capital.
Suggested reading on the cattle question.
Sahlins, Christopher : Stoneage Economy
Seafford, Richard: Money and the early Greek mind
Heichelheim, Fritz Early economy
Heichelheim An Ancient Economic History.
Goetzman Money changes everything.
Schabaz, Margaret The Natural Origins of Economics.
McInerney, Jeremy The Cattle of the Sun: cows and culture in world of the ancient greeks.
Merchant, Carolyn. Reinventing Eden: the fate of nature in Western Civilization