Provocation #207. Leisure and economics.

Early economics was concerned with the well being of society, of all the people. This was limited because people acquiesced to the view that the population was divided between the rich and the poor and then into capitalists land owners,  and the laborers. But there was still a vigorous discussion about how the product should be distributed among them. Smith, Ricardo, Coleridge, Mill and many others in the nineteenth century were involved in complex social relationships – dinners and clubs –  that discussed theses issues. (Read Catherine Gallagher’s The Body Economic life, death and sensation in political economy and the Victorian Novel).

Jumping ahead to WW2, three emerged the view that the hope of technology was to eliminate drudgery and create leisure. Bad work should be done by machines. Women were to stay home (alone) with labor saving devices, the men wre to go to work to earn enough to buy the house to house the machines and their attendant wife. A living family evolved in a few decades into a machine of production and consumption. Tech was supposed to keep making this better, providing relief. What happened?

Some how the stuff produced that was supposed to produce leisure  caused people working harder (in my childhood a working person, say a carpenter, could afford a house and to send children to college.) The extra, which should have relieved labor, was coopted by management and ownership. Economics seems to have abetted this process, or at least stood by seeing but ignoring, or blind to the emerging reality. Falling into the logic of pleasure and pain being a single dimension as an aid to computational approaches seems to have made very small minded thinkers of most. Economics mostly seem to have supported an anti-union attitude – keeping workers from organizing – but not at all critical of the organization of capital. 

The life style of the increasingly rich has not emerged into a new civilization, but into corruption, alcohol, sex, status symbols – not into conversational salons and seminars. The elites have in fact de-educated themselves.

Aristotle was clear that a well managed estate produced a surplus, and the surplus should be used for creating leisure time, for what?  – for the study of philosophy and participation in politics (very different from our slothful view of leisure.) Discussion of the purpose of leisure was shown to be discussable – but we have not done it.

Instead of discussing how better to distribute wealth we are abandoning the poor to marginal employment, unemployment, or climate catastrophe. Any idea of organizing society for the good of all is missing from most contemporary discussions. 

Interesting to look at ways invented that led to increasing inequalities. Limited Liability is one. It removed from individuals the right to sue for damages, thus reducing their real ownership  value of what they have purchased,  because if it fails, the responsibility that should exist is vastly limited. This is an uncompensated taking to the advantage of capital. Imagine a group creating a limited liability corporation to build a large ship which unfortunately sinks in the harbor where it was just launched, and the resulting waves produce damage in the harbor way beyond the cost of the ship. The losers can’t sue for the full damages because of limited responsibility. Limited liability throughout a society, where no one is responsible for much, means there is no responsibility  adequate to the dangers taken on by the institutions of the society.

If the use of fossil fuels are not going to cut be cut sufficiently  (eliminated) to prevent a 3 or 4° rise, are we willing to discuss how such a failure that might  unfold?

If  economy is   embedded in society, that just  means complex  feedback loops between the two. Discussing these feedback loops requires understanding both the economy and society. If you look at economics curricula there is almost nothing about society.

How can it be that the rich are getting richer and the poor are being lifted out of poverty at the same time? Sleight-of-hand.  The  income of the poor is going up, let us agree for the moment, but the prices of real estate,  access to art museums, the fees for national parks,  are all going up more rapidly.

Both the impact of society on economics, and the  impact of economics  on society are mostly left out of our modeling. 

What if economics is unnecessary to understand economy? If we had no discipline of economics we might have common sense about the economy, the pragmatic relations of humanity and society to the material world in all its manifestations. “Economics” has been aligned with elite needs from its early use just after Wealth of Nations as the nation became an instrument of wealth centralization rather the good of the whole.

“Economy” goes back to the Greeks.  “Economics”, probably from Alfred Marshal, early 1800’s, was an attempt to  – by adding “ic” to be scientif- ic. (Economic and economics do no occur in Wealth Of Nations. The adjective “economical” does a few times  in the sense of austere management. “Economy occurs a few times, always in the context of a specific: “the economy of the rich” , “The economy of private people”, and a few times as “political economy”. 

(From Wikipedia – The discipline was renamed in the late 19th century primarily due to Alfred Marshall from “political economy” to “economics” as a shorter term for “economic science”. At that time, it became more open to rigorous thinking and made increased use of mathematics, which helped support efforts to have it accepted as a science and as a separate discipline outside of political science and other social sciences)

Interesting to imagine if accounting had been taken as the basis for understanding the economy rather than  economics .

As it is, economics has been a force for fragmentation (“separate discipline outside the other social sciences”) making it hard to understand the economy in all its relations between society, people and the material world). 

Economics has a strong tendency to be pulled into ideologies.

We miss out on common sense about how to make a good world, and we are left with  fighting fragmentation of social thought.

Provocation 168. How to expand the scope of economics.

In the spirit of provocation..

Economics advanced by making assumptions that treated most of society as external to economics, but it turns out, as it has, that the dynamics of society profoundly affect the mainstream neo-classical economic model: ownership, wealth: interest, politics, people’s state of mind and taste, new inventions, state of the earth. How can we now bring the externalities back in to the thinking of current economics?

In a simple way economics started with a broad interest in society , Adam Smith, Ricardo, Malthus, and then in the mid 1800’s (and many others, see the flow in for example The Edinburg Review), then succumbed to formalism and math, looking scientific with equilibrium and “rational” economic man, and with these narrowing its scope of interest. But now, with a society in disarray because it is undone by the things economics (the understanding of an economy) excluded (people, politics, earth), the trend is back toward needing good narratives of what happened – and maybe even to what could happen. Since economics aligned itself with, even advanced, the dominance of models and formalism, what can economics do now to reorient its thinking around the issues of consequence – the interface between society and nature?
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Physics friend “ Physics models are relevant to circumstances which never change. Economics make models that sort of work – until circumstances change.”

The following from Andreas Malm’s essential book, Fossil Capital.

Re climate: “We are looking always at the impact of climate on society. It should be the other way – looking at the impact of society on climate.”

“The traditions of the dead are breathing down necks of the living, leaving them with two choices: smash their way out of business as usual – and the heavier the breath, the more extreme the measures must be – or succumb to an accumulated, unbearable destiny.”

Knock knock economics. Anybody home?