It is clear that the economy is broken. Climate change induced by economic activity, inequality as a result of economic activity, and weak government due to the rise of corporations, are all obvious causes of this complex situation. One can argue about the complicity of economics in creating this complex failure, since economics in so many ways works to enhance the economy for the rich. but the argument is stronger that economics at least allowed it to happen, standing by..
So, assuming that the economy is broken what can happen? We can either drift, allowing anger and climate temperature to increase, or try to repair it, possibly keeping basics in place, or perhaps not.
There are several obvious directions for the future.
We can either move to greater fragmentation and localization as people try to cope with their experience of the breakdown and its impact on their lives in communities. With localization we can expect some mix of democracy and mafia led organization, but millions of local solutions may not scale to counter large system forces, especially climate and land deterioration and perhaps we would include institutional deterioration.
But the same people might find themselves uniting in the idea that the center can, with money and technology and leadership, hold together. This technocratic future w;il probably be highly authoritarian – to get the job done.
These two directions might be happening simultaneously. The question for us is what might be the role of economics as we move from the old system through the breakdown to a new system? Obviously there is a lot of risk with any possible path Such breakdowns in the past were slow to happen and slow to repair. But certainly something will happen.
In other words. We have an existing economy but it appears – climate, governance, inequality – to be seriously broken. There are many writers stressing that this is an opportunity and necessity, to build new and better.
How to get from plan A to plan B, and what might B look like.?
This seems to me to be an important and obvious task that new economic thinking cannot avoid.
A major reason for the current failure is that economics pushed social concern out of consideration. People were teated as identical units. Thier real needs and interests were ignored but festered. This had the advantage that class issues were treated as externalities, outside the perspective of economics and the economy could proceed creating great wealth and great poverty, exploiting people while exploiting the environment.
In its defense, elites are necessary in a complex, society but we are at the point where complexity is beyond the possibility of management. Jospeh Tainter’s The Collapse of Complex Society argued that complexity increases faster than population till collapse. But wise, that elites, who always one the key infrastructures, when the system is in trouble, instead of repairing, cut costs so they can take more money out of the system.
To think about the future it is a good strategy to think that key parts of the current system, a system in failure, is to question key concepts. Understanding of major changes in the past – the shift from feudalism to industry for example, always came along with new concepts – and unfortunately wars and huge losses to the population.
Take capital and private property , two key concepts. Capital comes from cap, head, a new head of cattle. The birth of a new calf was capital. It means that capital is the production and reproduction of the wealth of society. Strong men owned it and do so to this day. Not much magic, just power. Another key concept is private property. Property is simple. IT mean what is proper of a person of rank to show their status in society. “Dressed properly.” A social sign became with time a thing that could be bought and sold. Private comes from the latin privatus meaning to remove from the public.
We can expect, as the environment deteriorates further and covid runs its awkard socially destructive course, that the media – press-, scientific journals, YouTube videos and public demonstrations will become increasing strident while proliferating wiht analysis and proposals in multiple directions.
It is importune that we see this in its fullness and realize that excluding major rends, while make economic easier, has benefitted a few and that this is not good enough. The research approach that would understand how A transforms into B would require a better description of A, a butter understanding of transitions, and lots of hard work on understanding the possibilities of B. Lots to do.
Mann, Charles C. 1491: New revelations of the America before Columbus
Maccarraher Eugene The Enchantments of Mammon: how Economics became the Religion of Modernity
Malko, Jedrezj Economics adn its discontents
Scott, James C. Against the Grain: a deep history of the earliest states
Mcinerney Jeremy McInerney-The Cattle of the Sun_ Cows and Culture in the World of the Ancient Greeks-Princeton University Press (2010)