Month: June 2016

“Toto? I don’t think that we’re in Kansas anymore.” And so I am adjusting to the world outside the Berkeley “bubble.” Today’s bumper sticker read “Legalize Freedom.”

Obviously a call for legalizing free and safe women’s health, or a call for freedom against the terror of unregulated fire arms sales, or a call for the freedom to education, health, and security in one’s property and personal effects. Or perhaps the owner of the pickup bearing this sticker was calling for the freedom to be free from poverty. Legalize freedom. Ok.

Freedom has figured centrally in the story we have been covering in Economics 105: History of Economic Thought this semester. For nearly all of history, wherever we can put down our finger, communities understood freedom substantively. Whenever they spoke or wrote of freedom they meant something like Amartya Sen’s substantive freedoms.

But then beginning in fourteenth century Western Europe another experience of freedom began to emerge; not substantive freedom, but the freedom from constraint. This new freedom was associated with a new kind of social subject, the free economic actor or agent. For all of human history, in all communities on the face of the planet, economic freedom — freedom of the private οίκος, hence οικονομία — was constrained by the public interest, by res publica, hence “republican” laws, institutions, and values: laws, institutions, and values that have public interests in mind.

Now, however, a new kind of social subject appeared, a subject claiming no obligations to serve the public interest, a subject insisting that any public constraint on his private enterprise entailed an infringement upon his freedom. This new understanding of freedom is everywhere evident in the political discourse of the eighteenth century, alongside the more traditional, republican understanding of freedom. Both appear in the US Constitution, although in 1789 the republican is still dominant.

I suspect that when individuals urge us to “legalize freedom” today, what they mean is something far nearer to the kind of freedom over unregulated disposition over private property demanded by southern states in 1861; the same kind of “freedom from constraint” that has stood at the center of the anti-federalist platform ever since the founding of the republic. Anti-federalists object to the constraints placed on private enterprise. They prefer the 1783 Articles of Federation to the 1789 Constitution. When they call for us to “legalize freedom,” what they want is for the public to leave them alone.

Of course, the irony is that this is the opposite of republican values, laws, and institutions. But it is also contrary to the private interests of most of those who want the 1789 Constitution overturned. They believe that the public is all that stands between them and true freedom. They have little understanding of substantive freedoms embraced and defended by the framers of the 1789 Constitution: the conditions that make for freedom.

The tragedy is that short of these conditions, individuals become subject to the largest and most powerful οικοι, the largest and most powerful private households. These, presumably, are not theirs.

A couple of weeks ago I posted a blog expressing general admiration, but a few reservations, about Tom Frank’s Listen Liberal.

Is it possible to remember labor without celebrating it? Is it possible to promote the right to education, health, security, and leisure without also promoting the right of capital to pave the path that makes these possible? When we celebrate FDR and the New Deal, do we also have to celebrate the industrial conditions that made the New Deal necessary?

I was barely a quarter into Tom’s book. And that was before the Brexit vote (the new “post 9-11”?).

I very much admire the way Frank dissects the Clinton and Obama presidencies, linking them to a misplaced faith in the well-graduated, professional managerial class and, more importantly, to the meritocratic, inno(vation) ideology used to justify wholesale privatization, deregulation, and elimination of the rights of working families. I also admire Frank’s midwestern Farm-Labor tinged perspective. Frank is from Kansas. I’m from Wisconsin. Both of us were raised in blue collar socialist-leaning, New Deal families. But both of us also earned our Ph.D’s in history from the anti-Ivy Ivy League university, Chicago.

If there is any institution in the US that believes in the power of ideas — not birth, legacy, lineage, entitlement, but — the power of ideas, it is Chicago, where the fact that your mom or dad or uncle graduated in “whenever” and contributed “whatever” to the endowment has exactly zero influence on whether you will be admitted. What matters is ideas. Period. And that is clear from Tom Frank’s shake-down of the liberal class. Guilty as charged.

At Chicago, therefore, no criticism is more biting or more feared than the accusation that your argument is “undertheorized.” The criticism that I need better or more complete data I can take. So too the criticism that I need greater specificity. But for my argument to be undertheorized! A fate worse than death itself. So Tom will know what I mean when I say that his argument is undertheorized. (This from the co-founder of the University of Chicago’s Social Theory Workshop.)

Let me be specific. I understand that working families endure a lot of hardship. I understand that they deserve a fair deal and that FDR gave them a fairer deal than the deal they were getting from Hoover. In The Wrecking Crew, Frank talks about the public service mentality of the civil servants who poured into Washington, DC after the war. My family arrived in DC in 1960 and remained until 1966, when my dad joined Robert McNamara in the exodus of the anti-war contingent from the Johnson administration. I can verify that when I returned to Washington as a lobbyist thirty-five years later the atmosphere was completely changed. I also understand and appreciate the distinction Frank invites us to draw between the Inno Democrats and the New Deal Democrats. As a lobbyist for biotech, I cannot point to anyone who was (a) not a Democrat; and (b) a supporter of organized labor. All of this fits. There is something big that the liberal class does not get. Two questions then: what do they not get? And why do they not get it?

Let me now propose a hypothesis. I believe that both the working class and the liberal class suffer from the same ailment. And let me drag out as my initial exhibit an unnecessarily blunt example (which we will then need to refine). All of those “best and brightest” folks JFK convinced to come to DC. Well Joe McCarthy was not all that delusional. Many, including my dad, if not closet members of the CPUSA, were sympathizers. That is to say, it was possible in the 1950s and 1960s to be both well-graduated and militantly pro-labor. I was born in 1957. My parents were not baseball fans and they named me Joe. ‘Nuff said.

At the same time, while the Teamsters and IWW were integrated, the same cannot be said for the AFL or even the CIO (who at least admitted blacks). The folks who beat on the heads of my older brother and sister in Chicago in 1968: they were not exceptions in the labor movement. Exceptions in the labor movement were the black sanitation workers in Memphis that Frank highlights. Yes, there were plenty of CPUSA sympathizers within the AFL and CIO. But the leadership was all red, white, and blue. Moreover, when it came time for the AFL-CIO leadership to send their kids to school, they sent them, every last one of them, to an Ivy. But this strongly suggests that the fulcrum on which this thesis turns — the well-graduated managerial professional liberal class on the one side and the working class on the other — fails to grasp something critical about the shift in social subjectivity that settled in after the war, by which I mean WWII.

Let us suppose for a moment that there is at least some truth in the analysis of, among others, Bob Jessop, David Harvey, Jeffry Frieden, Giovanni Arrighi and Robert Brenner that one of the big changes that settled in between 1944 and 1970 was that the US emerged in 1945, Bretton Woods (which established the World Bank, the IMF, and the World Trade Organization) under its belt, as the sole superpower. Japan and Germany were nowhere on the map. That was both the good news and the bad news, which is why both Presidents Truman and Eisenhower worked furiously to rebuild the economies of Germany and Japan. Who else would buy and consume our goods? And let us suppose that the towering success organized labor enjoyed from, say, 1932 to 1968 was in large measure due to the prodigous outlay of public taxpayer dollars, the largest in history, which it so happens was the price citizens had to pay to beat the Nazis and the Nationalists. Labor wins! And, yet, by 1968 Germany and Japan were back in the game so to speak and competition from their industries placed downward pressures on prices, which placed downward pressures on rates of return on investment — not only in the US, but also in Germany and Japan — which suggested that something needed to be done to avoid general financial collapse.

In all fairness, President Nixon tried. He tried to pass universal single-payer healthcare, but the UAW and therefore the Democrats objected because, it was argued, universal single-payer healthcare would weaken the union’s bargaining position with management. Nixon also tried to fund high-speed rail. But, again, the UAW saw rail travel as a substitution for the private automobile. The Democrats demurred. And so in 1971 President Nixon, out of options and not wishing to repeat the debacle of 1959, when President Eisenhower refused to devalue the Dollar and so (it is argued) delivered the margin for Kennedy’s victory — Nixon took the Dollar off the Gold Standard, let it float, and so provided that ephemeral bump to the economy that, it so happens, was scarcely needed in his trouncing of George McGovern by a landslide.

Of course, there is nothing particularly magical to currency devaluation. All of a sudden foreign goods are Dollar-expensive, domestic goods are Dollar-cheap. For a brief interval before equilibrium sets in, foreigners are buying US goods and factories enjoy a brief new lease on life. But, of course, there is the other side of the equation, where the demand for cheap US goods in Germany and Japan lead to deindustrialization and plant closures among our economic competitors, whose workers, now laid off, can no longer afford even US goods. And so a downward global cycle sets in. We call this global downturn the 1970s.

Some nations, most notably Sweden, Denmark, and Holland, had a ready answer to global stagnation. Simply accept lower returns on investment and spread the efficiencies generated by their economies more broadly. Everyone can do with slightly less. This solution clearly did not sit well with US investors, who demanded (and received) a fundamental shift in the regulatory regime. And while President Carter laid the groundwork for deregulating financial markets and eliminating burdensome taxes and regulations on private industry, President Reagan was the superhero who delivered formerly public interests into private hands.

I have no problem admitting that well-graduated Democrats played a role in the regulatory shift from labor-intensive industrial production to high-return “intellectual” financial instruments. Yet Frank completely overlooks the roles played by (1) the largest US Federal outlay in history to win WWII; (2) the complete destruction of the economies of our two leading competitors, Germany and Japan; and (3) the recovery of the Japanese and German economies in the late 1960s. Lord Keynes, it is true, famously lamented in 1932 how “there was no expenditure out of the proceeds of borrowing that it was thought proper for the State to incur except for war.” He hoped “that in the future we shall not adhere to this purist financial attitude, and that we shall be ready to spend on the enterprises of peace what the financial maxims of the past would only allow us to spend on the devastations of war.” That was in 1932. Yet, the fact is that it was WWII that generated not simply the unprecedented post-war boom, but also the accompanying growth of organized labor. No boom, no labor. Or, better. Maybe the US, like Germany and Italy or Spain adopts some form of extreme politics. My point is that big labor is as much a product of WWII as big capital.

The question is: what do we do in 1971? Germany and Japan are back in the game. We are past full employment and full industrial capacity. Any loosening of the currency will be inflationary. Constraining the currency will induce higher unemployment and economic contraction. Could we have followed the path of lower growth rates like Denmark, Holland, and Sweden? Theoretically, yes. Practically, no. Both labor and management, both working families and investors had grown accustomed to the boom brought on by WWII. Again, Lord Keynes: “I hope that in the future we shall not adhere to this purist financial attitude, and that we shall be ready to spend on the enterprises of peace what the financial maxims of the past would only allow us to spend on the devastations of war.” Good luck with that one.

At full employment and full industrial capacity, there was literally nothing the public could do to restore those luxurious 5-6% rates of return. It could not issue more currency. It could not lower interest rates. So, now what?

At this point, 1980, Frank wants labor to intervene; or he wants liberal intellectuals to intervene on labor’s behalf. And the truth is that the United Mine Workers and PATCO resisted heroically in the 1980s, but all to no avail. Because the regulatory regime had already shifted, begging the question: how does one earn returns on any current market? In the 1960s, investors earned returns by investing in labor. In the 1970s this was no longer clear. And in the 1980s it was absolutely clear that, in order to earn returns, investors should identify high-return financial instruments — i.e., not labor.

One way to inflect this problem is to conclude that the liberal class, the managerial professional class, the well-graduated class maliciously (yet successfully) maneuvered an end-run around their traditional allies, the working class. Another way to inflect this same problem, however, is to conclude that WWII was an anomaly. Lord Keynes was essentially right. We do, traditionally, only spend huge public sums on war. Those expenditures either completely destroy us — Germany and Japan — or they enrich us. But, traditionally, we are not inclined to spend such large sums of public moneys during times of peace. Perhaps we should. But we don’t. More importantly, when in the 1930s and 1940s these huge sums were spent on big labor, big labor emerged in 1945 more hostile to class analysis than a decade and a half earlier. Big Labor emerged in the 1950s and 1960s as the handmaid of Big Capital. And that was that. To find sympathizers with the CPUSA you actually had to look in government itself, to well-graduated, professional managerial midlevel operatives like my dad.

As a sidenote, dad eventually found himself coordinating radical feminist, immigrant, and worker movements in California during the 1980s, 90s, and 00s. My point, however, is that the neat division — working families versus the well-graduated — is woefully undertheorized. It fails to grasp what actually happened in the 1960s and 1970s.

Let us shift the discussion one notch. Is labor a form of oppression or is labor itself emancipatory? And, if it is oppressive, what does it oppress? What is the evidence of its oppression? I would argue that the overwhelming support for Brexit among working families in the UK is evidence of their oppression. But I would also argue that my colleagues’ incapacity to theorize through (or outside) of capitalism is also a variety of oppression. And I would argue that the simple institutional inertia of the global system; it too constitutes a form of oppression. Not workers versus well-graduated versus investors; but, what is this system in which all of us are contained? How does it work? Why does it work? Why do all of us — workers, intellectuals, investors — do its bidding? What social logic is at work here?

On on the final page of his book, Tom Frank offers the following practical advice:

What we can do is strip away the Democrats’ precious sense of their own moral probity— to make liberals live without the comforting knowledge that righteousness is always on their side. It is that sensibility, after all, that prevents so many good-hearted rank-and-file Democrats from understanding how starkly and how deliberately their political leaders contradict their values. Once that contradiction has been made manifest— once that smooth, seamless sense of liberal virtue has been cracked, anything becomes possible. The course of the party and the course of the country can both be changed, but only after we understand that the problem is us.

Frank, Thomas (2016-03-15). Listen, Liberal: Or, What Ever Happened to the Party of the People? . Henry Holt and Co.. Kindle Edition.

Again, I am sympathetic. There is no agent outside of us — no deus ex machina — that will fix this. We are it. Nevertheless, I do find it curious that the solution rests on “understanding,” an intellectual act. We deploy our minds and words to unsettle, disturb, “crack” the “moral probity” of the Democratic elite.

What’s wrong with that? Listen, liberal. There are a lot of things that minds are good at. However, when they fail at the very thing — methodological, theoretical and analytical rigor — at which they excel, then we know something is terribly wrong. Here is my theory. When minds are bent towards money, their thinking is skewed. There is nothing specially wrong with being well-graduated. There is nothing specially wrong with liking innovation. There is even nothing specially wrong with merit, so long as it is genuinely merited. But, as Aristotle noted over two and a quarter millennia ago, minds are bent and misshapen by money, so that they do not think clearly.

So, where was the error? Was it in the 2010s, when President Obama did all he could to hold a fragmented and fragmenting nation together? Was it in the 2000s, when President Bush did all he could to reward not merit, but wealth and greed? Was it in the 1990s, when President Clinton bent over backwards to prove that Democrats were the friends of financial markets? Was it the 1980s, when Presidents Reagan and Bush set about demolishing the social welfare state? Was it the 1970s, when Presidents Nixon, Ford, and Carter writ sold to the deed of Bretton Woods? Was it the 1950s and 60s when Presidents Kennedy, Johnson, and Nixon rode a war-time boom to its natural conclusion? Or was it the 1930s and 40s, when Presidents Roosevelt and Truman poured resources into war, which no US President has ever spent on peace?

And all along the way, with every step, the progressive working class and progressive intellectual class have marched in lock-step, for the most part. I think that what Frank is saying is, we, the liberal class, should know better precisely because we are smart. That is the mistake, I think. Minds are bent by capital. Thinking is skewed, not because it is evil or bad, but because it is real. The best thinking does not escape capital, but seeks to understand it. I am not sure Frank has succeeded.

I went to a local tapas restaurant tonight, Cesar’s, to follow the returns from the UK vote. While I was hoping for a different outcome, as my students will confirm, I was not surprised by the results. When Aristotle first theorized democracy in the fourth century BCE he explicitly left out δουλος, δεσποτης, and οικονομικον (workers, managers, and entrepreneurs) because he believed that each of these groups was unaccustomed to promoting the public good.

http://www.theguardian.com/politics/2016/jun/24/gold-prices-oil-eu-referendum-out-vote

It is customary to interpret Aristotle’s framework as a justification for rule by elites, with good reason. Yet, over the past half millennia theorists have wondered whether Aristotle may have been constrained by his own circumstances to overlook an alternative reading of this framework. If the efficiencies of capital were redistributed downward and outward, providing wealth, education, good health, security, and leisure to all, then none would have reason to promote their own private, particular interests and all would share an interest promoting the common wealth. This, in fact, was the conclusion ultimately reached by the authors of The Federalist Papers: the sustainability of the Republic depended in the end on making sure that policy makers did not “have a horse in the race,” as the saying goes. Yet, because they could not conceive of a circumstance under which laborers, managers, and entrepreneurs would constrain themselves, they instead settled on near substitutes: wealth, land, and in some cases education.

This proved a grave mistake. For, as Aristotle knew all too well, wealth, land, and education are not what we are aiming for, but only the means to that end. And it was simply all too easy to mistake the means for the ends and so draw the mistaken conclusion that these means were themselves of value.

In the case of Great Britain’s Brexit, capital recognized that its value was optimized by open borders, which reduced transaction costs and favored an optimal distribution of human capital. What capital did not understand — still does not understand and cannot understand — is that human beings are themselves, ultimately, distortions in the optimization of value.   Our aim is to lower factor costs and increase the production function. It is “natural” to pursue this efficiency, while it is “unnatural” to “intervene” into markets, which are simply and innocently pursuing their “natural” end. If this entails lower wages, diminishing purchasing power, expanding income inequality, and so on, these are simply the price we pay for “liberty.”

The irony, of course, is that capital really doesn’t care. So Great Britain has voted to leave the EU. So global markets have plunged on this news. It was nothing that was not anticipated in advance. Well before the outcome was announced, capital, it will be discovered, had moved on. And all of those voters celebrating this morning? Celebrating what? The declining purchasing power of the Pound? The self-imposed constraints on British markets? The higher costs of goods? The higher transaction costs for trade? Capital itself will not even notice these inconveniences. It will have moved on. But working families in Great Britain, many of whom were convinced to vote for leaving the EU, they will genuinely suffer deeply.

But the tragedy is that capital will never comprehend how it was itself the trigger that led to Brexit. It will never comprehend how the pursuit of private self-interest at the expense of public interest eventually leads consumers to act against both their own interests and against the interests of capital.

Aristotle’s solution was simple: first, the chief end of private enterprise is to finance public goods, which, of course, are incapable of financing themselves; but second, private enterprise should never be granted a hand in shaping public interest, since its whole raison d’être is to promote its own private interests. That’s it. That’s Aristotle’s solution.

Tragically, British citizens — or in any event 52% of them — have settled on the worst course possible: rule by private enterprise without any of the benefits arising from its efficiencies. It is the opposite of Aristotle’s solution.

I have been encouraging my students to listen to Marketplace®, the syndicated audio journal produced on the USC campus. One of the more illuminating series airing on Marketplace® is a set of five shorts titled “The Price of Profits,” which, this last Friday, aired a segment titled “Shareholder Values versus Jobs.”

The segment focuses on the changing shape of employment in Nashville, poster child of the new economy. Like many southern states, over the past thirty years Tennessee has enacted a steady stream of laws that aims at attracting capital. Capital is felt to be attractive because where capital goes, it stands to reason, jobs and revenues follow. Except that often the costs to municipalities, counties, and states for attracting capital include tax incentives (even offering handsome capital incentives) and weakening or eliminating labor standards; all of which serve to eliminate or reverse the benefits felt to arise from attracting capital in the first place.

Which raises the interesting question: who actually supports these efforts?

No mystery here. Capital is attracted to places where it is felt to perform most efficiently for shareholders. Municipalities, counties, and states that eliminate industrial standards and taxes make these places attractive to the owners of capital.

My students will recognize that this pattern of deregulation has been recognized and understood for well over a century. My students read WS Jevons, C Menger, and A Marshall, all late nineteenth century economists who recognized and understood this pattern. Chiefly, however, its principle interpreter has been JM Keynes, who, following A Marshall, noted that, wherever investment decisions led investors to adopt policies leading to declining wages and declining consumer demand, there markets suffered irreparable harm in the short-run from sagging demand and, in the long run, from additional costs arising whenever businesses face additional factor costs.

One common response to these additional costs is to further exacerbate the problem by shifting the regulatory burden off the shoulders of investors onto the shoulders of working families. The idea, of course, is that, if we eliminate the drawbacks to investment and economic expansion, investors will plow their capital back into job creation, which, in turn, helps reignite demand. The problem is that these regulatory changes favoring capital teach precisely the opposite lesson. They teach, in effect, that investors can enjoy handsome returns — better returns, in fact — maintaining the liquidity of their assets (not fixing them to factors of production) than plowing them into factories and jobs. In other words, the very regulations themselves (which, in effect, eliminate constraints on private capital) remove the incentives to investment in jobs and factories.

Curiously, this predictable response to the new economy is also playing out in Europe. Wherever capital can find favorable conditions — i.e., deregulated labor and capital markets — it will migrate, creating precisely the credit crunch we see in the struggling economies of the EU. Where the regulatory structure remains strong, by contrast — e.g., in Germany, France, etc. — there, capital markets remain strong and consumer demand is strong. So, for example, in a manner similar to the US, where owners of capital prefer to live, dine, and raise their families in NYC, San Francisco, Chicago, and Minneapolis — places with stronger regulations on labor and higher corporate taxes — areas of attractive rent-seeking opportunities (e.g., Greece) suffer.

A common market, where a shared set of regulations place the same constraints on capital throughout the market, leads to greater consumer demand and economic growth.

“Faith is the substance of things hoped for, the evidence of things not seen” (unknown first century Jewish writer).

I am finding it difficult to be hopeful these days. For the past five years I have been tracking how the gradual unraveling of the social, economic, and political fabric in Afroeurasia’s boundary lands has been penetrating into the core. The migration of families fleeing regions destabilized by poverty and war to regions flush with bounty from plunder has only accelerated over the last year, as has the resolve of these regions to erect barriers to those fleeing. As our models predicted it would, heightened global conflict has fed an arms industry already producing instruments of death well beyond “expected demand,” which has led to a thriving black market of weapons at bargain basement prices. (Go ahead. Google any weapon you can think of.) Coupled with Citizens United, global arms trade and income inequality means that those most victimized by poverty, poor health, and want are also made dependent on “information” streams designed, packaged and delivered to them by the very individuals and groups responsible for their impoverishment, individuals and groups who have an interest in diverting our attention away from the real cause for our hardship to imaginary beastiaries more fantastic and terrifying than any real-world cause for our concern. Real-world solutions — chiefly the redistribution of efficiencies back down the income hierarchy to the communities and individuals where they were produced — are replaced by Hollywood-style end-of-world fantasies, where peace almost inevitably comes through superior fire power.

Our models are behaving brilliantly. This is precisely the world our models anticipate when you aggregate 90% of the wealth in the pockets of less than 1% of the population. This is precisely how our models predict individuals will behave when they are deprived of health, security, education, and time. So you can understand why I am less than sanguine about the prospects for us getting out of this alive. Substance of hope? Where?

And, then, there is the Castro. What can I say? Although the initial reports of 1M are almost certainly exaggerated, not since the anti-war marches of 2001 have I witnessed so many families gathered in solidarity to express their collective outrage and resolve in the face of inconceivable sorrow and tragedy.

Why do we gather this way and for these reasons? Can’t we honor the victims of Orlando quietly, privately, each in our own way?

Yes we can. And I know we will. But what we most need is evidence, solid evidence, reason to believe that it can and will be otherwise. “Faith is the substance of things hoped for, the evidence of things not seen.”

We gather because this is that evidence, that substance, often lost in our rigorous mathematical modeling; modeling that always assumes (as it must) that tomorrow will look very much like today. Well, tomorrow cannot look like today. Tomorrow must look like the thousands of families gathered in the Castro to mourn the cold-blooded murder of our brothers and sisters and to challenge the doctrines of hatred and fear that motivated this act.

So, what is the substance, the evidence, of hope? Hope is looking down Market Street and not being able to see the edges of the mourners; hope is turning the corner off Market Street and seeing City Hall lit up with all of our colors.

Yes. This is bigger than the GLBTQ+ community. But it came as no surprise to any of those gathered last night that an establishment dedicated to music and dancing, overwhelmingly frequented by Latin members of the GLBTQ+ community, was the target of the largest mass shooting in modern US history.

They hate us. They hate that we dance and love music. They hate that we are in their mosques, their churches, and their temples. They hate that we are a rainbow. They hate that we do not share their hatred. The GLBTQ+ was not incidentally the target of this attack. It stands at the center of what they hate about us.

But this also helps to refine our vision. You cannot mourn Orlando and hate Muslims. You cannot mourn Orlando and offer us “separate but equal” accommodations. You cannot mourn Orlando and ignore the second-class treatment of ethnic and racial minorities and women.

If love drives out fear and hate, the Castro drove out lots of fear and hate last night. I was glad to have joined the vigil. It gave me hope where there is otherwise little reason to hope.

I have begun reading Tom Frank’s Listen, Liberal and it is good, very good. In it, Mr Frank clearly identifies the slide of the Democratic Party from the party of working families to the party of managerial professionals; the slide of the Democratic Party from my Grandparents to me. You should read Tom’s book.

Confession. I first encountered Tom Frank at Jimmy’s “Woodland Tap” back in 1991 as an entering graduate student at the University of Chicago. “That’s Tom Frank,” a friend pointed out. My eyes wandered to a young man (attempting to look old?) in a fedora and trench coat. “He edits ‘The Baffler.'”

Even at the time there was something “mysterious” about a resident of Hyde Park who was neither professor nor student. “What kind of creature is this?” I wondered.

I will withhold a review of Tom’s book until I have read and digested it in its entirety. It covers territory with which the readers of this blog will already be familiar.

But, here is my front end take. Tom wants the Dem’s to be defenders of working families; so do I. But he is also critical of the educated elite; I am not. As readers of this blog will know, I believe that the working class is as much a product of capital as trust funds and the rentier. The working class is a signature attribute of the elite. Readers will also know that I firmly believe that emancipation from necessity — from compulsion — holds the key to clear reflection about our condition: a person cannot think clearly about their condition with a gun to their head. Tom does not think highly of the folks I circulated with in Hyde Park.

And, yet, Tom makes an important — critical —  observation. I experienced the shift in 1998 when I worked as a consultant in Silicon Valley. It was not simply that the labor movement was dead. That was obvious. What people told me was that the labor movement was unnecessary, obsolete, anachronistic. This shift paralleled a shift in the Democratic Party leadership, a shift that Tom makes us face, away from working families to the managerial professional — liberal — class.

Is it possible to remember labor without celebrating it? Is it possible to promote the right to education, health, security, and leisure without also promoting the right of capital to pave the path that makes these possible? When we celebrate FDR and the New Deal, do we also have to celebrate the industrial conditions that made the New Deal necessary?

I am only half way through Tom’s book. And, as I have already said, I like Tom Frank. But I anticipate some critical interventions in his approach.

I just now got off the phone with the Alameda County voter registration office. They confirmed that after seventeen years living and voting at the same address my wife and I had been disenfranchised without notice. I am hoping that ours is simply a quirk in the system. But perhaps not.

Here’s how it works. Someone in the US Post Office declares that our ballot is “undeliverable” at our address. That’s it. No one attempts to contact us. There is no follow-up. And just like that, we are declared “inactive.” Had we showed up at the polls tomorrow and cast a provisional ballot, it would not have counted.

Our voter registration has been reactivated. But now I am concerned that we are not alone. If this has happened to you, call Alameda County voter registration. Also, I am curious how widespread this disenfranchisement has been. Are we an outlier? Or are we a victim of massive voter fraud?

Not many of us critically reflect on the conditions that make the universal possible. So it was with sadness that I read the BBC report “Abandon ‘utopian dreams’, says EU Head.”

Here is the causa cura:

The European Union should abandon its “utopian dreams” of ever-closer integration to combat rising Euroscepticism, Donald Tusk has said.

The president of the European Council said EU leaders should concentrate on practical measures such as reinforcing borders and a banking union.

What is disturbing about this perspective is that it displays a profound lack of appreciation for the causal relationship between economic integration and universality. Yes, dreams for integration can be — frequently are — utopian. That is to say, they are conceptualized absent place, no place, ou-topos.

To so conceptualize Europe is, on some level, perfectly understandable. When in the fourteenth century Europeans set about to shed their particular identities and to replace these identities with the abstract, universal identity of abstract time and abstract value — the birth of capitalism — they understandably mistook this new abstract identity for the universal towards which all human communities must necessarily be moving. When compared to Europe, other communities were limited — by tradition, religion, customs, superstitions, tyranny, despotism, and so on. Their limitations marked them as particular. Europe, by contrast, which had abandoned its traditions, religious forms, customs, and superstitions; which had submitted all of its legal, regulatory, social and cultural forms to the singular metric of abstract economic exchange, was therein mistakenly deemed “universal.”

And, yet, most Europeans failed to make the connection between their embrace of capitalism and their elimination of traditional social, political, cultural, and religious forms. They called this process over-simplistically “enlightenment” or “progress.” And they failed to make the essential connection between this process and the unprecedented extraction of wealth and labor upon which it was predicated.

To them, nevertheless, the recalcitrance of other communities was palpable. The failure of these communities to assimilate to the universal could only be credited to their “backwardness,” their lack of “development,” their “primitive” institutions and beliefs — in short, their particularity. From this perspective, colonialism and then imperialism can be viewed as playing out a necessary, system-required integration or unification of the entire globe into a comprehensive, rational, integrated, universal whole. Yet, we often conveniently overlook or downplay precisely what is involved in this systemically dictated universalization. It requires the — often quite violent and brutal — sacrifice of the particular for the sake of the universal. And no one knows this better than Europeans themselves.

From the moment that capitalism gained a beach-head at the workhouse of St Pierre in Ghent in 1324 it began to dissemble every last feature of European cultural, religious, economic, social, and political life, so much so that when Europeans looked back to the fourteenth century from the vantage-point of the eighteenth, absolutely nothing appeared the least familiar to them. In a matter of three and half centuries, capitalism had laid waste to an entire complex cultural form and had erected in its place a vast, integrated, comprehensive, rational legal, political, economic and social system. We need not review here the terrible violence of those centuries. At the time, particular communities were well aware what was happening to them. They recognized that everything they had once known — every single certainty — was being forcibly annihilated under the weight of economic necessity. The social, political, and economic, but specially the religious and cultural destruction could not possibly have been more costly.

Surely, therefore, if we imagine European integration will be non-violent and non-destructive, the EU President is not mistaken when he accuses us of “utopian beliefs.” He is right: it would be terribly naive to suppose that the displaced peoples of the southern and eastern Mediterranean or of south central Afroeurasia might simply slip into Europe without the least violence, devastation and destruction. For what is expected, hoped for, anticipated is the complete annihilation of their religious and cultural forms in a manner and to a degree not unlike the steady annihilation of European religious and cultural forms over the past five centuries; except that we are expecting and hoping for this destruction in a matter of years, months, weeks, or even days. We (who have grown so accustomed to such large-scale cultural violence) are inclined to view the complete elimination of whole cultural forms with an air of near total indifference. “Why all the fuss?”

But, the other side of Mr Tusk’s counsel displays how completely the EU President misunderstands the process he believes he is examining. It is precisely on account of the global integrating process — now already over five centuries old — that communities bordering on the Mediterranean and extending eastward through Afroeurasia are spilling over their arbitrary political borders into central and western Europe. Economic theory suggests that they will achieve equilibrium; and the costs borne by those seeking to slow or reverse this migration might as well be spent building a wall between Mexico and the US or between north and south America as on preventing human capital from seeking its optimum use. In these costs is only so much dead-weight loss; loss both on account of the underutilization of resources, but also on account of the prohibitive transactional costs (police, prisons, border guards) sunk to prevent global labor markets from achieving Pareto optimality.

Yes, there is some value in preserving and strengthening security in Europe. But of all people Mr Tusk (from Poland) ought to know how integration works. For centuries Europe has used southern and eastern Afroeurasia as a warehouse for cheap labor and raw materials. It is past time for Europe to restore the resources it pillaged and seized from these communities — not, as its practice has too often been, by propping up useful oligarchs and military dictators, but by investing massive resources in public institutions and processes.

Of course, in the wisdom of neoliberalism, such investments are deemed foolish because they do not reinforce civil society, i.e., the private market. Recall, however, that neoliberal theorists are worse than ignorant when it comes to the institutional and regulatory conditions that make for functioning private markets. Not one of these theorists evidently has even cracked a history book on the institutions or regulations of seventeenth or eighteenth century France, England, Germany or the United States. None evidently has given a moment’s reflection to the vast public institutional and regulatory framework — not to mention public frameworks for education, communication, currency regulation, banking, police, fire, courts — without which private markets simply do not function.

Evidently these theorists have forgotten that we invest in emerging markets precisely on account of the rent-seeking opportunities available in these markets, opportunities that undermine well-functioning legal and political institutions. Neoliberal theorists are therefore extremely unlikely to appreciate the costs that must necessarily be borne to bring these emerging markets into the global economy.

Rather than strengthening border controls and banking in the Euro-zone (both of which are surely necessary in the short run), Mr Tusk should be focusing Europe’s attention on how it can better open its borders in the long run. The violence and destruction to which Mr Tusk calls attention is what we should anticipate whenever whole cultural forms are called into question and eliminated. But since this destruction is itself evidence of a quite specific universalism — the universalism of capital — the response cannot be a reversion to European particularism. Rather must it be a thoughtful and careful investment in a different, less violent, and perhaps less destructive particular course toward integration.

Europe is not no place. It is some place. It is not ou-topos, not utopia. For were it no place, those who are not there would not seek to be there at great risk to their and their families’ personal safety and lives. Thinking critically about how to make this possible is necessary, but need not be utopian.