Movers and stayers

by John Quiggin on July 18, 2019

A lot of discussion of immigration is framed around the distinction between movers and stayers. Until recently, most of what I’ve seen has framed “stayers” as those who see their economic interests as being threatened by competition from immigrants. To protect themselves, they want to restrict immigration, even if the consequence is to restrict the opportunities for “movers” from their own country. The harm to these “movers-out” is just collateral damage

But lately I’ve been seeing a different account, in which it’s the departure of the movers-out that is causing problems by reducing the supply of workers to provide services to, and pay taxes to support, the stayers (particularly, the old). In economic terms, the obvious solution would be to replace the movers-out with movers-in, but they are of the wrong religion, skin colour and so on, and are therefore rejected. That exacerbates visible economic decline, particularly in terms of the level of economic activity, even when income per person holds up or is sustained by transfer payments. This in turn produces support for Trumpism and its variants.

This story comes up most clearly in relation to Eastern Europe (most notably Hungary) following accession to the EU, but I think it’s applicable to many rural areas in richer countries.
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Sunday photoblogging: flower

by Chris Bertram on July 14, 2019

The garden at Cropston - rose

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The Lavatories of Democracy

by Henry on July 10, 2019

[being a review of Alex Hertel-Fernandez’ State Capture: How Conservative Activists, Big Businesses, and Wealthy Donors Reshaped the American States – and the Nationcross posted from HistPhil]

 

A couple of months ago, Yvonne Wingett Sanchez and Rob O’Dell wrote a long journalistic article on the influence of ALEC, the right-wing American Legislative Exchange Council, on legislation in U.S. states. ALEC has had enormous influence on state legislatures by providing model bills and courting lawmakers. O’Dell suggested on Twitter that this marked “the first time anyone has been able to concretely say how much legislation is written by special interests.” This … wasn’t exactly accurate. Columbia University political science professor Alex Hertel-Fernandez, who is briefly quoted in the piece, had recently published his book State Capture: How Conservative Activists, Big Businesses, and Wealthy Donors Reshaped the American States – and the Nation, which applied similar data to similar effect.

It was a real pity that the book didn’t get the credit it deserved, and not just for the obvious reasons. While the article was good, it focused on describing the outcomes of ALEC’s influence. The book does this but much more besides. It provides a detailed and sophisticated understanding of how ALEC has come to have influence throughout the U.S., how it is integrated with other conservative organizations, and how progressives might best respond to its success.

It’s a great book – crisply written, straightforward, and enormously important. It is energetic and useful because it is based on real and careful research. Hertel-Fernandez’s politics are obviously and frankly on the left. But even though his analysis starts from his political goals, it isn’t blinded by them so as to distort the facts.

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Foxglove, backlit by the setting sun

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A new two party system?

by John Quiggin on July 5, 2019

Recent elections (notably including those for the European Parliament) have shown the evolution of what I’ve called a three-party system, replacing the alternation between soft and hard versions of neoliberalism dominant since the 1980s. The three parties in this analysis are the (a) remaining elements of the neoliberal consensus, (b) Trumpists[1], and© leftists, defined as broadly as possible to encompass greens, feminist, social democrats, old-style US liberals, as well as those who would consciously embrace the label “Left”.

When I wrote in 2016, the biggest loser from this process seemed to be the kind of soft neoliberalism exemplified by Blair, and many of the European social democratic parties. But that was before Trump and Brexit.

The striking development of the past few years has been the capitulation of the mainstream rightwing parties to various forms of Trumpism. That’s most obvious with the US Republicans. And, while some advocates of Brexit may still hope for a free-market utopia, its pretty clear now that this is unlikely to happen. The continuing desire to get Brexit done at all costs is all about culture wars, with Leavers cast as the British people and Remainers as out of touch elites. The same pattern is evident in Australia, where free market policies have been abandoned in favour of culture wars, to the extent that the government is seriously considering building coal-fired power stations, just to make a point.

I’m not well enough attuned to the nuances of European politics to discuss developments at the national level. In aggregate, though, it seems clear not only that the mainstream conservatives are losing ground electorally, but that they are moving towards Trumpism.

This suggests that the current three-party system might rapidly resolve itself into a new two-party system: Trumpists against everyone else, with the remnants of the old neoliberal duopoly being forced to take sides. This is already happening to some extent.

In this context, it was striking to read a piece in the Washington Post, of all places, slamming the “economically conservative, socially liberal” centrism of Howard Schultz, and pointing out that

Centrism,” in other words, has become a byword for the politics of the business elite. Defined left to right, on an x-axis, it may approximate the center of the political spectrum. But on a y-axis that represents socioeconomic status, it sits at the very top.

It’s hard to say where centrists will end up. On the one hand, they mostly benefit from the regressive tax policies and weak regulation that Trumpists have carried over from hard neoliberalism. On the other hand, the Trumpists have abandoned free markets for crony capitalism, typically favoring well-connected national insiders, exemplified by the US First Family. That poses problems for global corporations and fans of globalized capitalism like Tom Friedman, who still yearn for the halcyon days of the 1990s.

As ought to be obvious, I’m still working this out, so I’ll leave it to commenters from here.

fn1. I previously called this group “tribalists”, which was problematic. The Key characteristic is the identity politics of a formerly unchallenged dominant group facing the real or perceived prospect of becoming a politically weak minority, as with white Christians in the US. As Trump and others have shown, this kind of politics leads naturally to support for demagogic dictators and would-be dictators.

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Sunday photoblogging: Pézenas pigeons

by Chris Bertram on June 30, 2019

Pézenas pigeons

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Opportunity cost, MMT and public spending

by John Quiggin on June 29, 2019

I’ve been busy for the last week doing events for Economics in Two Lessons, so I didn’t have time to take part in the discussion arising from Harry’s post on alternatives to Sanders’ proposal to wipe out college debt.

In one way, that’s a pity because the key point of the book is the idea of opportunity cost – the true cost of anything, for us as individuals, and for society as a whole, is what you must give up to get it. More precisely, it’s the best alternative available to us.

Harry’s post was all about opportunity cost – what would be the best use of $1.6 trillion in public funds. However, the discussion was inevitably enmeshed in the complexities and inequities of US education, while comments making broader arguments about opportunity cost reasoning weren’t discussed in detail.

One of those broader arguments is the idea that, thanks to Modern Monetary Theory, there’s no need to worry about such questions. In the “chartalist” reasoning underlyng MMT, the fact that governments can issue their own sovereign currency means that there is no need to “finance” public spending by taxation; rather taxation is a tool used to manage aggregate demand so as to keep the economy fully employed but not at a point where excess demand creates inflation. That (essentially correct) position can easily slide into the (only subtly different, but radically mistaken) view that governments can spend money on anything they like with no need for any increases in taxes or cuts in other spending.

As I will argue over the fold, a correct version of MMT makes no such claim. Unfortunately, while avoiding the error themselves, a lot of MMT theorists have not shown much willingness to set their more naive followers straight.

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Apparently cancelling all student debt under Sanders’s plan would cost $1.6 trillion, and would be funded by a wealth tax. $1.6 trillion is a lot of money. Sara Goldrick-Rab gently says: “There’s a piece of me that has seen how widespread the pain is, including among people you might say are financially fine. But there’s a piece of me that knows what the pot looks like, and says, ‘That’s not the best use of the money’”.

Think about other uses: There are about 100,000 public (k-12) schools in the US. I’ve tried dividing $1.6 trillion by 100,000 several times now and every time I do it the answer is $16 million (I find math using ‘billions’ and ‘trillions’ difficult, because the words have different meanings in UK and American English, and I’m not always confident which language my head is in. So maybe I’m off?) $1.6 trillion could endow every public school in the country with, or give a one-off capital grant of, an average of $16 million. An average endowment of $16 million per school would yield $800,000 in additional spending per school in perpetuity. Another way of thinking about this. There are 51 million public school children. $1.6 trillion yields about $31k per student. Create an endowment and you can spend $1.5k more per student in public schools than we currently do. Forever.

(Co-incidentally, if the government did spend $1.5k more per student per year in public schools, that would almost bring government spending per-student per year in k-12 up to the level of government spending per-student per-year in higher education!)

Another way of thinking about it. Sanders’ main spending proposal in k-12 is tripling Title One spending (Federal funds that go to schools with low income children in them). Title One spending is currently around $14 billion. (He adds $1 billion for magnet schools and unspecified amounts for universal free school meals, and for a few other things, which I’ll leave aside). Divide 1.6 trillion by 14 billion and you see that he’s proposing to spend 100 years of current Title One funding on a one-off cancellation of student debt. He could quadruple title one spending for 100 years instead. Or quintuple it for 50 years. Or sextuple it for 25 years. He’s proposing to spend 50 times more just on relieving student debt than to increase annual Federal spending in k-12.

Or: restrict your concern to access to higher education. $1.6 trillion would pay the current Pell Grant budget for 50 years. Another way of putting this: Endow the Pell Grant program with $1.6 trillion, and that pays for Pell Grants at 2.5 times the current rate. Forever.

Some defenders say that debt forgiveness would be good for the economy.

Student debt forgiveness would also help stimulate economic growth by freeing borrowers to buy homes and improve their credit, while primarily benefiting racial minorities, according to Steinbaum and researchers at the Levy Institute, a left-leaning think tank.

Omar, who has student debt, said in a statement that the plan would “unleash billions of dollars in economic growth.”

If the point of the plan is reducing debt loads, rather than being about education, why is the plan specific to college loan debt? People who didn’t go to college have debt too: and have worse earning prospects. Is there some evidence that cancelling student debt (a good deal of which is held by high earners) is better for the economy than cancelling other kinds of debt. Or just lowering the costs of living for low income families by, for example, enabling them to purchase new and efficient automobiles that have lower running costs than older cars that they currently buy because they are cheaper? $1.6 trillion would buy $53 million Chevy Volts, reducing automobile running costs for 53 million low income families. Or one could address the massive wealth gap between African Americans and whites by biting the reparations bullet: a mortgage down payment of $34k for every single African-American would increase dramatically home ownership among African Americans. Or whatever.

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Sunday photoblogging: Clark Street Bridge, Chicago

by Chris Bertram on June 23, 2019

After last week’s offering, I looked through a few more of my Chicago pictures and quite liked this one. (Plus, a note to our commenter “oldster”: comment leaving a valid email address or email me, and I will respond.)
Clark St Bridge

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Last Sunday a letter appeared in the Sunday Times attacking the LGBT charity Stonewall for its work with British universities as a threat to academic freedom. For context, a non-paywalled version of the text us available here).The letter was signed by some reasonably prominent figures, such as Kathleen Stock (Sussex) and Leslie Green (Oxford) as well as motley others (including a Brexit Party candidate). It is no accident that the letter appeared in the Sunday Times, which together with its companion paper the Times has, for at least a year, maintained an almost daily campaign against transgender people and the organizations and individuals who support them and which has also been to the fore in attacking universities around largely spurious concerns about “free speech”.

In response at least two letters of reply have circulated, one of which appeared in the Independent, and which I have signed (see this Pink News piece for link). The text of this blog post derives from what would have been another such letter, specifically from philosophers, which I drafted in consultation with some others (and I particularly thank Catarina Dutilh Novaes for her contribution). Hence, perhaps, some of the tone of the text below which was originally written with in the first person plural. I feel there is a particular obligation to speak out within philosophy because of the prominent role philosophers have played in public debate on these issues and because of the recent relentless focus of the leading blog in philosophy on trans debates. [click to continue…]

Tactical Voting

by Harry on June 19, 2019

In the very unlikely event that you, a CT reader, will have a vote in deciding the United Kingdom’s next Prime Minister, and haven’t made up your mind, you could do worse than listening to various of the candidates discussing ‘political thinking’ with Nick Robinson. I don’t listen to the Today programme, and have no other real exposure to Robinson, and, in general, dislike the underlying premise of Political Thinking that looking at people’s childhood and youth tells you something useful about their political thinking. What is good about the podcast is Robinson’s other premise which is basically that in the long form interview it is very hard for politicians to disguise who they are. A typical pattern—Dominic Raab, Steve Baker and Esther McVey all comform—is that they start out seeming reasonable and perfectly decent but end up seeming either nuts (Baker), poisonous (McVey) or both (Raab). [Of course, plenty of interviewees (eg David Lidington, Stella Creasey, David Gauke) end up seeming exactly as they did at the beginning—smart, serious, decent]. It is no accident, as Robinson knows, that the most likely future PM has not yet chosen to appear on the show.

Anyway, down to business. There was talk at the second stage of the vote that the repulsive Johnson’s campaign might “lend” votes to Hunt so that Boris would face him rather than someone else in the run-off among the members, thus giving him an easier time than he might have against another contender. Simon Cotton on twitter says:

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Sunday photoblogging: Chicago

by Chris Bertram on June 16, 2019

Downtown Chicago-5

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Can globalization be reversed?: Part II (migration)

by John Quiggin on June 12, 2019

In my previous post about globalization, I concluded that plausible policy shifts (essentially, the continuation and widespread adoption of Trump’s current policies) could bring about a substantial reversal of one element of globalization – the complex global supply chains that now characterize the production of goods. In this post, I’m going to look at migration, which is now the most politically salient aspect of globalization, and argue that even draconian policies are unlikely to do more than slow the most important consequences of migration.
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Strangers on a Train

by Harry on June 12, 2019

I didn’t really know Charlotte: she was one of several women who seemed to flock around my quite eccentric friend Chris – several of whom I think had unrequited romantic interest in him. We were all 19, toward the end of the first year of college. One bright Monday afternoon in June 1983, after returning from lectures, I bumped into Charlotte (not one with a romantic interest) sitting with another Chris acolyte, Samantha, who had always struck me as rather dull, and cheerily asked how they were doing.

Samantha, it turned out, was not at all dull: she was dropping out of college, and had committed to working her way round the world on a sailboat with some unknown family. Sounded terrifying to me. As for Charlotte – well, according to Samantha “She’s not doing well at all. She needs to talk to someone, and not me. Do you have a couple of hours to talk to her?”. As you can imagine, coming from two people I had talked with for a total of about 10 minutes hitherto, this was bemusing, so I turned to Charlotte who confirmed the need to talk, and implored me to go for a walk with her.

Bedford College was beautiful – a large Victorian building that could have been a not very posh private school, sheltered in the Inner Circle of Regents Park. You could walk out of the grounds, into the park, and talk for hours, barely hearing the traffic at all. So we did, and Charlotte told me her story.

She was very, very, upset. Bedford was the first choice for a few students drawn to London but with a taste for comfort. But for most, I think, it was second choice to one or another Oxbridge college. I suspect Charlotte was in the latter camp, and, like many of the women (though few of the men) had a boyfriend from school – they’d been together I think at the Grammar school, not the Cathedral school, in Stourbridge—who had got to their first choice. Hers was at one of the Oxford colleges that you’d heard of if you knew the system, but not if you didn’t. She routinely visited him for the weekend: the previous Friday was no exception. Maybe the most shocking part of the story for me – and I suspect this says a lot about both my naivete and my political outlook – was the first part: he wasn’t there, so she let herself into his room and started tidying it and making his bed. It really had never occurred to me that girlfriends might deliver such a service, and, frankly, I was assaulted by its unfeminist character. She was nonplussed by my disapproval, but was keen to get to the next part.

“Making his bed I discovered that he had been having sex with another girl”

“How did you know that?”. At this point, perhaps she was thinking she should have chosen a less dull-witted confessor (though, I have to say, I am 99% certain that the one person in the college more clueless than I was our eccentric mutual friend, Chris).

“Well, you know. I found incontrovertible proof. Among the bedclothes”. I was still puzzled, but didn’t let on.

It turned out that Steve, the boyfriend, had been having sex with an American student whom he knew through their political group at Oxford. Subsequently, I have to say, I met the woman to whom I’ve now been married for 27 years in a political group, but at the time I was sufficiently puritanical to disapprove of meeting romantic partners through politics. Though, if I had been more approving of that, I still would still have balked at the organization in question: they were members of the Oxford University Conservative Association. I was somewhat more outraged with his behavior to her than his being a member of OUCA: I’m even now quite pleased with myself that I didn’t even hint that how much I disapproved of someone having a Tory boyfriend, and focused entirely on his treatment of her. He, of course, shrugged off the sex as a one-night stand at first, but over the course of the weekend it became ever clearer that in fact they’d been having it off for weeks. (Yes, the weekend: she had stayed all weekend, and had only returned to London for lectures that very morning). But this was June, and, as the boyfriend pointed out, the American girl was only there for the year: she’d be leaving early in July, so there was really nothing to worry about. They could continue as usual.

I’d never really had this sort of conversation before. I did a lot of listening, expressed a lot of sympathy, and, where appropriate, outrage. We walked the whole time, side by side, so we didn’t look at each other a lot. Now I’m old, and am very comfortable hearing people’s distressed stories, and am good at making people feel at ease when they are sobbing; at the time I had no such skill. I’m sure that I helped, but suspect that pretty much anyone with a sympathetic ear would have been as much good for her.

And then… nothing. I don’t mean that badly, but no-one had phones, and our paths didn’t cross naturally, and she went home at the end of June: then, in October, her course had been moved to Royal Holloway College (with which most of Bedford College was merging), while I was left at Bedford.

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Green new deals and natural resources

by Chris Bertram on June 11, 2019

I’m nearly through reading Barbara Kingsolver’s The Poisonwood Bible at the moment, and very good it is too. For those who don’t know, the main part of Kingsolver’s novel is set in the Congo during the period comprising independence in 1960 and the murder of its first Prime Minister, Patrice Lumumba, on 17 January 1961 at the hands of Katangan “rebels” backed by Belgium and the US. And DR Congo (sometime Zaire) has been pretty continuously violent and unstable ever since. With its origins in King Leopold’s extractive private state (rubber), Congo has been coveted and plundered for the sake of its natural resources ever since. At the time of the Katanga crisis copper was the thing. But now what was previously a little-wanted by-product of copper extraction, cobalt, is in heavy demand because of its use in batteries.

My attention was caught yesterday by a press release from the UK’s Natural History Museum, authored by a group of British geoscientists:

The letter explains that to meet UK electric car targets for 2050 we would need to produce just under two times the current total annual world cobalt production, nearly the entire world production of neodymium, three quarters the world’s lithium production and at least half of the world’s copper production.

A friend alerted me to a piece by Asad Rehman of War on Want, provocatively entitled The ‘green new deal’ supported by Ocasio-Cortez and Corbyn is just a new form of colonialism which makes the point:

The demand for renewable energy and storage technologies will far exceed the reserves for cobalt, lithium and nickel. In the case of cobalt, of which 58 per cent is currently mined in the DR of Congo, it has helped fuel a conflict that has blighted the lives of millions, led to the contamination of air, water and soil, and left the mining area as one of the top 10 most polluted places in the world.

People who are optimistic about the possibilities of decarbonizing without major disruption to Western ways of life and standards of living are often enthusiastic about new technologies, battery developments etc. I’ll include CT’s John Quiggin in that (see John’s piece from CT Can we get to 350ppm? Yes we can from 2017). John tells me he’s sceptical about claims that we are about to run out of some scare resource. Maybe he’s right about that and more exploration will reveal big reserves of copper and cobalt in other places. But even if he is, we still have to get that stuff out of the ground, and that’s predictably bad for local environments and their people, and in the short to medium term it may yet be further bad news for the people of DR Congo who have already endured seventy plus plus years as a “free” country (and 135 years since Leopold set up in business) in conditions of violence and exploitation, whilst already wealthy northerners get all the benefits.

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