Was the gold standard a golden age, or a gilded one? How does it compare to later monetary regimes? I mean, we know the gold standard was terrible for the US, but what about other countries? I know you want to know, without having to dig in data appendices, so I made you some charts. Because I love you that much. (But not enough to extend the floating exchange rate regime data down to the present; that’s actual work.)

growth

inflation

Data from table 1, Michael Bordo, “The Gold Standard, Bretton Woods and other Monetary Regimes: An Historical Appraisal,” NBER working paper no. 4310.

In The Reactionary Mind, I wrote:

One of the reasons the subordinate’s exercise of agency so agitates the conservative imagination is that it takes place in an intimate setting. Every great blast—the storming of the Bastille, the taking of the Winter Palace, the March on Washington—is set off by a private fuse: the contest for rights and standing in the family, the factory, and the field. Politicians and parties talk of constitution and amendment, natural rights and inherited privileges. But the real subject of their deliberations is the private life of power: “Here is the opposition to woman’s equality in the state,” Elizabeth Cady Stanton wrote. “Men are not ready to recognize it in the home.” Behind the riot in the street or debate in Parliament is the maid talking back to her mistress, the worker disobeying her boss. That is why our political arguments—not only about the family but also the welfare state, civil rights, and much else—can be so explosive: they touch upon the most personal relations of power.

Feminism—and the backlash against it—is the paradigm case of the battle over the private life of power. As historians have shown, the attack on Women’s Lib gave the modern conservative movement what it needed to achieve its counterrevolution in 1980. But to understand why that was the case, we have to recall just how radical feminism truly was: it sought to disrupt concrete and tangible relationships in the most private relations of power. [click to continue…]

1975 and 2013

by John Quiggin on April 9, 2013

There’s already plenty of commentary, here and elsewhere on Margaret Thatcher. Rather than add to it, I’d like to compare the situation when she assumed the leadership of the Conservative Party with the one we face now. As Corey points out in his post

In the early 1970s, Tory MP Edward Heath was facing high unemployment and massive trade union unrest. Despite having come into office on a vague promise to contest some elements of the postwar Keynesian consensus, he was forced to reverse course. Instead of austerity, he pumped money into the economy via increases in pensions and benefits and tax cuts. That shift in policy came to be called the “U-Turn.”

Crucially, Heath was defeated mainly as a result of strikes by the coal miners union.[1]

From the viewpoint of conservatives, the postwar Keynesian/social democratic consensus had failed, producing chronic stagflation, but the system could not be changed because of the entrenched power of the trade unions, and particularly the National Union of Miners. In addition, the established structures of the state such as the civil service and the BBC were saturated with social democratic thinking.[2]

Thatcher reversed all of these conditions, smashing the miners union and greatly weakening the movement in general, and promoting and implementing market liberal ideology as a response to the (actual and perceived) failures of social democracy. Her policies accelerated the decline of the manufacturing sector, and its replacement by an economy reliant mainly on the financial sector, exploiting the international role of the City of London.

Our current situation seems to me to be a mirror image of 1975. Once again the dominant ideology has led to economic crisis, but attempts to break away from it (such as the initial swing to Keynesian stimulus) have been rolled back in favour of even more vigorous pursuit of the policies that created the crisis. The financial sector now plays the role of the miners’ union (as seen in Thatcherite mythology) as the unelected and unaccountable power that prevents any positive change.

Is our own version of Thatcher waiting somewhere in the wings to take on the banks and mount an ideological counter-offensive against market liberalism? If so, it’s not obvious to me, but then, there wasn’t much in Thatcher’s pre-1975 career that would have led anyone to predict the character of her Prime Ministership.

fn1. I was too far from the scene to be able to assess the rights and wrongs of these strikes or the failed strike of the early 1980. It’s obvious that the final outcome was disastrous both for coal miners and for British workers in general, but not that there was a better alternative on offer at the time.

fn2. The popular series, Yes Minister, was essentially a full-length elaboration of this belief, informed by public choice theory

From the Mixed-Up Files of Mr. Jon Lee Anderson

by Corey Robin on April 9, 2013

Last month, New Yorker reporter Jon Lee Anderson turned twelve shades of red when he was challenged on Twitter about his claim in The New Yorker that Venezuela was “one of the world’s most oil-rich but socially unequal countries.” A lowly rube named Mitch Lake had tweeted, “Venezuela is 2nd least unequal country in the Americas, I don’t know wtf @jonleeanderson is talking about.” Anderson tweeted back: “You, little twerp, are someone who has sent 25,700 Tweets for a grand total of 169 followers. Get a life.” Gawker was all over it.

What got lost in the story though is just how wrong  Anderson’s claim is. In fact, just how wrong many of his claims about Venezuela are. [click to continue…]