Archive for the 'News' Category

Chris Bertram, Crooked Timber.org

David Graeber’s Debt: The First 5000 Years begins with a conversation in a London churchyard about debt and morality and takes us all the way from ancient Sumeria, through Roman slavery, the vast empires of the “Axial age”, medieval monasteries, New World conquest and slavery to the 2008 financial collapse. The breadth of material Graeber covers is extraordinarily impressive and, though anchored in the perspective of social anthropology, he also draws on economics and finance, law, history, classics, sociology and the history of ideas. I’m guessing that most of us can’t keep up and that we lack, to some degree, his erudition and multidisciplinary competence. Anyway, I do. But I hope that a Crooked Timber symposium can draw on experts and scholars from enough of these different disciplines to provide some critical perspective. My own background is in political philosophy and the history of political thought: so that naturally informs my own reactions as do my political engagements and sympathies. So mine is merely one take on some of the book’s themes.

Most people who work in the capitalist West are in debt: both individually and collectively. That indebtedness takes many forms. I have a mortgage, and I have to work to pay it off. Many of the consumer goods I enjoy are bought on credit. My students, thanks to “reforms” to the British higher education system initiated by “New Labour” and put into operation by the ConDem coalition will have massive debts that they will be seeking to redeem for their entire careers. My employer has long standing debts to the banks, underpinned by covenants that require that it carry out its business to certain standards or face unfavourable renegotiation of terms. The entire people of Greece are in debt and face, as a consequence, years of austerity and the loss of much of their political autonomy. And many other countries are in the same position. As Graeber points out near the beginning of his book, many third world countries, having been sold loans from pressurizing Western banks, loans that they can’t repay, have had to implement “austerity” and accept tough conditions imposed by international bodies, such as the IMF. Debt reflects on these recent events in historical perspective, seeking out precedents, but also giving an account of the emergence of the debt and money as social institutions and the way in which out ambivalent attitude to these is infected by the way our moral language and our folk conceptions of sociality are infected with ideas of debt, owing, repayment, obligation and the like.

Michelle Dammon Loyalka, The New York Times

When China’s vice president, Xi Jinping, visited the White House on Tuesday, President Obama renewed calls for China to play more fairly in the world economy. Vice President Joseph R. Biden Jr. echoed those sentiments, telling Mr. Xi that the two countries could cooperate “only if the game is fair.”

But while China’s industrial subsidies, trade policies, undervalued currency and lack of enforcement for intellectual property rights all remain sticking points for the United States, there is at least one area in which the playing field seems to be slowly leveling: the cheap labor that has made China’s factories nearly unbeatable is not so cheap anymore.

China has experienced sporadic labor shortages, which in turn have driven up its once rock-bottom labor costs. This trend is particularly evident in the weeks following China’s Spring Festival, or New Year, when more than 100 million rural migrants return to the countryside to spend the year’s biggest holiday with family. Coaxing those same migrants back into the urban work force has proven increasingly difficult. More…

Image: UPI/Kevin Dietsch

Andrew Hacker, The New York Review of Books

Cary Grant as Johnny Case, a self-made man, at his rich fiancée’s house with her brother Ned (Lew Ayres) and the butler (Thomas Braidon), in George Cukor’s Holiday, 1938

Imagine a giant vacuum cleaner looming over America’s economy, drawing dollars from its bottom to its upper tiers. Using US Census reports, I estimate that since 1985, the lower 60 percent of households have lost $4 trillion, most of which has ascended to the top 5 percent, including a growing tier now taking in $1 million or more each year.¹ Some of our founders foresaw this happening. “Society naturally divides itself,” Alexander Hamilton wrote in The Federalist, “into the very few and the many.” His coauthor, James Madison, identified the cause. “Unequal faculties of acquiring property,” he said, inhere in every human grouping. If affluence results from inner aptitudes, it might seem futile to try reining in the rich.

All four of the books under review reject Hamilton and Madison’s premises. All are informative, original, and offer unusual insights. None accepts that social divisions are inevitable or natural, and all make coherent arguments in favor of less inequality, supported by persuasive statistics.

1.

The Spirit Level is a prodigious empirical effort directed to a moral purpose. It ranks the quality of life in twenty-three countries, mainly European, but with Singapore, Israel, and the United States also on the list. To evaluate the well-being of each society, Richard Wilkinson and Kate Pickett use indices ranging from obesity and incarceration rates to teenage births and the feelings people have about their fellow countrymen. They then relate these variables to how income is distributed in each society. Here they deploy the Gini ratio, a three-digit coefficient purporting to measure the extent of income inequality within any grouping for which figures are available. Their national Gini scores range from .230 in egalitarian Sweden to .478 in highly stratified Singapore, with the United States second highest at .450. Linking social indicators to economic disparities, the authors conclude that “reducing inequality is the best way of improving the quality of the social environment.” More…