Some quick links

by John Quiggin on November 11, 2011

  • A few days ago, Australia’s Parliament passed legislation implementing a carbon tax (strictly speaking, a fixed price for carbon emissions permits, intended to convert to an emissions trading scheme in a few years). Here’s a piece I wrote for the Australian Financial Review on what this will mean for the doomsayers (that is, those who falsely predict economic doom as a result of this measure).
  • Social scientists have known for a couple of decades that, contrary to its national myths, the US is a country with low intergenerational economic mobility, by international standards. Back in 2001, when I reviewed The Real Worlds of Welfare Capitalism by Bob Goodin and others, I mentioned that this was already well known. More recent evidence has shown that social mobility is not only low but declining. Yet until recently, popular discussion in the US seemed impervious to this evidence. Now suddenly, the issue is everywhere. Time Magazine had a front page story, there’s another in Salon and even the National Review is talking about it. Surely Occupy Wall Street has played a role here, but the lead time for a piece like that in Time would presumably predate #OWS. The experience of the Great Recession seems finally to be breaking down the power of zombie ideas.

{ 21 comments }

1

Seth 11.11.11 at 7:59 pm

I recently watched David Graeber (here: http://www.youtube.com/watch?v=IcK7rkajHKE) citing Mauss to the effect that we are “already” communists, in the sense that multiple forms of social organization exist along side each other.

My immediate reaction was: “and we are also STILL living under feudalism.”

One of the dumbest cliches of Marxist historiography that clanks around in our heads is this idea that “capitalism overthrew feudalism”, as if “been there, done that”. Whatever you consider the most salient features of feudalism — whether customs of land-tenure, principles of hereditary political authority, personal lord/vassal bonds, forms of status-mediating ‘conspicuous consumption’, hereditary class roles, etc. — they survive in altered forms today.

2

mds 11.11.11 at 9:09 pm

Here’s a piece I wrote for the Australian Financial Review on what this will mean for the doomsayers (that is, those who falsely predict economic doom as a result of this measure).

They’ll ride their bundle of complete horseshit into a parliamentary majority?

3

Sufferin' Succotash 11.11.11 at 9:39 pm

@Seth
The two most salient characteristics of medieval European feudalism had disappeared long before the French Revolution anyway, those being vassal homage (involving a military obligation) and servile homage (involving serfdom). When Marx used the term “feudalism” he was using it as the French revolutionaries did, to denote the legal and fiscal privileges of the hereditary nobility and the established church.

4

LFC 11.11.11 at 10:27 pm

Now suddenly, the issue [social mobility in US] is everywhere. Time Magazine had a front page story, there’s another in Salon and even the National Review is talking about it.

So is Fareed Zakaria in a recent WaPo column (which tries, not too successfully imo, to separate this issue from that of inequality/distribution).

5

BrendanH 11.11.11 at 10:35 pm

Two decades? Erikson and Goldthorpe (1992)?

6

John Quiggin 11.11.11 at 10:57 pm

@Brendan – I’m not an expert on this, and particularly on the sociological side of the literature, but my understanding is that Erikson and Goldthorpe looked at occupational/status mobility, which neglects the effects of high income inequality in keeping economic mobility down (since in relatively equal societies success in a low-status occupation can push you further up the income distribution). I couldn’t get quick access to Erikson and Goldthorpe (1992) but Erikson and Goldthorpe (1985) says US social mobility is about the same as the UK, which is generally supposed to be more class bound than the European social democracies. Erikson and Goldthorpe (1985) debunk the idea that the US has exceptionally high mobility, but don’t seem to go any further.

7

gordon 11.11.11 at 11:11 pm

I’m no expert on the Greek constitution, but how the dickens can Lucas Papademos be Prime Minister if he’s not even an elected MP?

8

Bruce Baugh 11.11.11 at 11:15 pm

My fear is that economic mobility will end up with a place in the consensus like full or nearly-full employment: one of those things pundits nod nostalgically at but are sure can’t come again, and which may well be dismissed as another threat to our inevitable future in “just between us” discourse. (I find the claims that Obama and his advisors believe that we have no alternative to becoming part of a homogenized world business market plausible.) So acknowledging it in public as a thing lost could simply be a prelude to establishing that, well, shame, but it’s gone and can’t possibly come back, so what can we do to get hop polloi comfortable with their new permanent condition?

9

Bill Benzon 11.11.11 at 11:21 pm

On inequality in the USofA, you’re certainly right about the effect of OWS on public awareness of it. And no less a figure than David “Flim Flam” Brooks is in a panic about it. He’s recently devoted two columns disguising it, both of which I’ve critiqued at Truth and Traditions:

The Inequality Map

David Brooks, Fooled by Inequality

10

guthrie 11.11.11 at 11:24 pm

Bruce – the new labour solution was to bribe them with just enough benefits to allow you to live, and encourage the producers of bread and circuses in business. Now that the Tories are in power, that has switched to cutting benefits all over even if people commit suicide because of it.

11

BrendanH 11.12.11 at 12:59 am

John, note that Erikson and Goldthorpe focus on relative mobility rather than absolute mobility: how unequally opportunity is distributed, controlling for how much opportunity there is. Their main contention is that the relative mobility regime is very resistant to change, and very similar across market economies. Historical variation in the amount of opportunity (e.g. expansion in white-collar jobs in the mid/late C20) brings about big differences in the absolute level of mobility, even with an unchanging underlying relative regime.

12

Alan 11.12.11 at 1:22 am

I love “zombie ideas”, and a priori.

13

Pith Helmet 11.12.11 at 3:57 am

but the lead time for a piece like that in Time would presumably predate #OWS.
Occupy has been going on for about 2 months now (give or take). Time is a weekly magazine. It’s not like they were infiltrating a drug gang or anything.

14

Meredith 11.12.11 at 4:28 am

I wonder if low intergenerational mobility in the US over recent decades has been masked not just by the strength of national myths but also, to some degree, by the successes (however limited and compromised) of the civil rights movement. People “of color” in political and public life (including celebrities of various types), in academics, in business — there really has been a sea-change in their numbers and “public acceptance” since the 1960’s. But just as these changes distract even most liberals from e.g. the new Jim Crow created by drug laws and the way they are enforced, they enable Americans to imagine that economic mobility upward is also flourishing. After all, it took elite, “progressive” colleges and universities quite a while to notice that most of (for instance) the African Americans they were admitting were the children of African American doctors and lawyers. Only recently have admissions offices (and student support services) widened their lens to include “first- generation-to-attend-college” students.

15

krippendorf 11.12.11 at 2:35 pm

Sociologists have been studying comparative mobility since the 1950s. The first discussions of the distinction between absolute and relative mobility, or, if you prefer, structural mobility and social fluidity — appeared in the 1960s. Erikson and Goldthorpe, while major players in the field, came along much later.

As Quiggen notes, the sociological tradition of mobility studies uses social classes rather than income deciles (or what have you) to mark the social boundaries across which people move, or don’t move as the case may be. This stems from the longstanding disciplinary assumption that social class, not income, is thought to be the fundamental driver of life chances, collective action, behaviors and beliefs, etc. Income is, in other words, derivative of social class, in contrast to the economists’ assumption that income is the master variable of the inequality space.

Ironically, just as economists were “discovering” mobility, mobility studies were falling out of fashion in sociology. Some of this was internal: Mobility scholarship had become mired in arguments about social class schemes — Erikson/Goldthorpe dominated in Europe, but not in the US– and the “woman problem” in class analysis (mothers and daughters didn’t appear in mobility tables until the late 1970s, and even then it was in reference to the class into which they married). It became obsessed with modeling mobility tables as a purely methodological exercise. Funding for collecting fresh mobility data disappeared. (Wisconsin sociologists managed to convince the Bureau of Labor Statistics to include father’s occupation on the 1962 and 1973 Current Population Surveys. These efforts haven’t been replicated since.) But, the discipline also moved on to thinking about the sources of social reproduction, not just its patterns across time and space.

So endeth the crash course in the history of mobility studies, from a sociology perspective.

16

stubydoo 11.12.11 at 3:47 pm

Regarding intergenerational mobility:

I wonder how those calculations handle cases where the parents lived in a different country. From where I sit, I see plenty of people whose parents were not wealthy, making an excellent living in America. But they are mostly immigrants. America’s megacorporations are happily paying megasalaries to megahordes of talented and hardworking immigrants, without regard to their social background, at least where the immigration authorities don’t prevent it.

Meanwhile the people with American parents are mired in terminal decadence – it is culturally anathema to expend effort into something so mundane as being productive enough to make much more money than your parents did. Public policy cannot do very much about that. For many upper-middle class people (such as would read CT), class anxiety is such a way of life that you can’t avoid seeing a tragedy – but in reality your typical garden variety American proletarian has resources aplenty for living a perfectly good life, and is generally doing so.

By far the most promising avenue for promoting social mobility for a country like the US is in immigration policy.

17

Matt McIrvin 11.13.11 at 1:21 pm

Meanwhile the people with American parents are mired in terminal decadence – it is culturally anathema to expend effort into something so mundane as being productive enough to make much more money than your parents did.

Ah, yes, the “kids today are just lazy” explanation for all economic ills. How can we have decades of skyrocketing per-worker productivity in such a situation? Are recent immigrants so productive that they’re producing several times as much as everyone else combined?

18

mpowell 11.13.11 at 5:31 pm

@16, corporations do not pay megasalaries to immigrants. H1-B visas are a great opportunity for a company to get a talented employee on location in the United States (which is really much better than having to deal with an office in China) who has limited mobility due to visa issues. Any manager or HR exec can give you the breakdown, but I would guess they are paid on average at least 20-30% than equally skilled employees with citizenship or a greencard. And it probably takes 5-7 years on average to get that greencard. Anyways, nobody but a C-level exec makes megabucks in anything but finance.

19

Watson Ladd 11.14.11 at 6:35 pm

Matt, it seems that what could happen is an increase in capital intensity raises the amount produced per worker without raising the amount the worker actually does. He pushes the button and 3 times as many widgets are made as before, because the machine is 3 times as big etc. This naturally has limits, which we can look at Marx to see. The question of taking this productivity is in my mind inseparable from overcoming capital.

20

ajay 11.14.11 at 7:34 pm

Surely Occupy Wall Street has played a role here, but the lead time for a piece like that in Time would presumably predate #OWS.

Minor point: I am not sure about that. The Occupy protests started in mid-September, and it’s possible that a story like the Time one could have been turned around in as little as a week. 9/11 was on the cover of that week’s issue. Likewise the US credit rating downgrade.

21

stostosto 11.14.11 at 10:35 pm

Very good piece on the ECB poobahs. Thank you!

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