There are three kinds of therapy our minds tend to apply to life as it is lived in our era. (Well, four if we don’t count binge-watching crime TV where bluish corpses are so grim and several, we think, “Well. Things could be a whole lot worse.” Unless it’s only me who does this on Sundays?)
The first is to take a Steven Pinker or Bill Gates or World Bank type hallucinogen, which allows us to view endless war as peace, wealth accumulation by a few as “billions being lifted out of poverty!” and private financial institutions being really awesome places that just want to, you know, help little ladies, or whoever. See also the cruder antidepressant of a Tony Abbott that allows climate change, if it even exists, to be not a bad thing, but more like free heating for the poor.
The second is to worry a lot about things, but to worry more that worrying about things out loud is to make our world worries worse. This complex anti-anxiety approach can be seen in, say, online responses to a description of a problem. Professor Hooziwhatsit writes that there are 1 billion persons starving on the planet, and then Thingymabob of Balwyn North holds forth in the comments, “Well. It’s all very well and good that you have described the problem, but what’s the point if you don’t have a solution, smarty-pants?” (At which time, Watchamacallit of Waverton might direct them to that nice Bill Gates, or a comforting article that says people are not that hungry, or to an upbeat festival, which promises that the solutions are at hand.)
The third therapy is the most tiring, ergo the least popular. If we see those other therapies as quick-fix drugs or peppy self-help, this is more like talking to Dr Freud for 10 years about one’s mother in the mild hope we can relieve ourselves of a nervous tic. It’s a process of endless diagnosis, which may just help us, and our analyst, to see the origin and the nature of the problem. It could be years before either of us works out how to fix it, and even then, we know it may not be solved in our lifetime. But at least we may die knowing the stuff that we have done on this couch will help a neurotic of the future.
If those first two therapies (or crime drama) work for you, read no further. One must live, after all, and the third cure is only for those who have both time and tolerance for the doctor’s couch. Otherwise, endure the first of a very irregular series that offers no guarantee of anything but frustration. Let’s take a brief look at three books, old or new, that may move us through the treatment process.
1 The Production of Money by heterodox economist Ann Pettifor
This book has, despite its intellectual pessimism, a tight and lively shape, and a very optimistic subtitle: How to Break the Power of the Bankers. This 2017 book may not truly give us a plan for breaking into the banks — we’d need a million with the persuasive pep of Pettifor, who comes across both in text and in speech as a headmistress at the sort of utopian girls’ school where even student Maggie Thatcher would have learned some good economic sense.
No small wonder that Pettifor was one of a handful who predicted the financial crisis of 2007-’08. She understands the power and profitability of the finance sector so well, she is able to explain it to people, like me, whose economic education has been about as solid as air. She takes us through the creation of money itself, and by the book’s end, we are amazed that it could be as easy as that. Banks extend credit, often for no truly productive purpose, and they make money. There’s so much of this made money, but so little of it permitted to arrive at the places where it might actually be useful.
Pettifor loves money. Not personally accumulating it mind; she admires its useful potential. Even the total pinko or the good Christian who feels that money should be abolished can learn from Pettifor how crisis occurs.
2. The Great Transformation by Karl Polanyi
This book was published in 1944, but it took muggins until 2017 to find it. This was with thanks to Pettifor, whose work is informed by an economic thinker who is just now being widely remembered. Karl himself, who had some very helpful ideas, didn’t help his own case much by writing like an economist. There’s an occasional zinger here, though, the most famous being that “laissez-faire was planned”.
This is his thing. It is the state that makes the “free market” possible. We can see, in a text written long before neoliberalism, that classical economic liberalism itself devised a series of techniques to brutally impose “freedom” on citizens. He published just as Friedrich Hayek, whom Polanyi knew from Vienna, published The Road to Serfdom which warned of the slippery slope of economic regulation. Let the government plan our market, they’ll plan us into slavery, etc. Hayek’s view remains popular to this day.
Polanyi, the shadow of Hayek, is getting a little attention now thanks not only to his description of the way in which the “free market” requires a lot of state machinery, but for his concept of a counter-movement. The coercive market gets too “free”, and there will be a response. In other words, he helps us understand Trump.
3. Listen, Liberal by Thomas Frank
This pessimistic, funny book published last year is the account of a disappointed Democrat. While Frank, who is a cheeky bugger, looks only at the internal disaster of a party that turned more toward Hayek than it did to the “serfs”, he also offers a story that could be more widely applied.
Again, the ardent belief that “freedom” must be expressed in the market had taken hold of another late twentieth century institution. This freedom, that requires so much planning and so much perky talk about how things have never been so good, has filled the DNC, but emptied it of enthusiastic supporters.
That’ll do for your therapy today. Get well soon. Or, at least, before those poor people enjoy too much heating from upbeat climate change.
I’m feeling better already. Thank you, Helen.
I aim to please/torture!
Thanks for the recommendations, Helen. I think you mentioned Ann Pettifor on your podcast with Wil Anderson the other day, and thank goodness it’s thicko proof! I might actually be able to understand a thing or two about economics and the movement of money. Hooray!
Oh, Craigles. When they start putting x over organic composition of labour, or what-have-you, my brain turns into that of a fifteen-year-old who hates maths. She wrote it for us to get the picture. (And I may have mentioned it to Mr Anderson. I do not know as the podcast is about seventeen hours long, and also I was a bit nervous because he’s quite famous, so had to get a bit drunk. Not much of a memory for what I said through the Dutch courage.)
Helen, that podcast was awesome! He gennnnuinely would have let you sit there and talk for another two and a half hours if he didn’t have that gig to get to.
I’m also relieved by your revulsion of maths. I’ve avoided it like the plague for too long but I need to understand more about numbers.
Very nice chap, that Anderson.
Re numbers. I don’t think it’s necessary. I believe Varoufakis, the game theorist, when he says that it’s more important to get your head around the concepts.
yes that’s probably, mostly right. Until you want to know the one bit of numbering that requires the aggregation and algorithms of a lot of other numbers to make it simple enough to digest. Then we need some numbers people.
Cool Helen. While the first two, and the fourth, may appear to be options, ignorance is not bliss and although all are born ignorant, I’m not sure that there is a choice about remaining ignorant. You are either comfortable with it, or you abhor it and will do what you have to to avoid it.
Where do you buy your books? I did click on the links to see, but they seem to be un-australian (yeah, joke). I would like to be able to support a local supplier if there is one.
I am good with numbers, but only to the extent of someone who did 3 unit maths in 1979, and has since made it part of his daily living. That was more than enough to understand all but the most esoteric rubbish in relation to economics, and you and Varoufakis are right, in that it is getting concepts that is more important than the maths.
Pettifor’s book in particular looks like a doozy. I’ve had some numbers people explain it to me, many years ago, but they are invariably poor in language, so I had to work it out from various reading and getting my head around the concepts. Bill Mitchell’s modern monetary theory is great to make you realise that it is actually about concepts rather than numbers too, and I know you have read him.
As for the free market, oh yes. Business wants anything but a free market. What they want is ‘certainty’. You hear them say exactly that word whenever a non-friendly policy position is being discussed. They want a downhill ride, no stops, all the way. That is probably the biggest lie of the current economic theory. Once you see through that bullshit, all else pales.
thanks for those recommendations, Helen. And the scary thing about the whole idea of the free market is that the metaphors about it not only aren’t accurate/don’t work in the economic context but keep being applied into other areas like human rights, where we are told that free speech is sacrosanct and we (for we, read: the relevant marginalised group, not actually ‘us’ at all) must all put up with hate speech because it is a necessary part of ‘the free market of ideas.’ This ignores the whole international jurisprudence around the balancing of rights, with none having primacy (there’s a talk about this at Sydney law school at 6pm tonight if you hurry). The other economist I find really interesting is Bill Mitchell from Newcastle, whose theory (as far as I can understand it) is that any sovereign nation can actually print money without causing inflation if it uses it for appropriate projects like schools, education, hospitals, infrastructure…. we have actually won the lottery but we are too stupid to realise it! this is no doubt a gross oversimplification – I sent away for his basic text so I can try and understand better. It arrived yesterday and the size is a bit daunting but it seems quite accessibly presented…”Modern Monetary Theory and Practice, an Introductory Text”. But if he’s even only partly right…. that would change everything.
Yeah. I am not sure about MMT. I need to read more, but I sort of suspect that it only works for the world’s most dominant currency. In a global context (and there’s no other context) I see problems.
Anyhow. The thing that likely will happen is UBI. Which is just gonna be so bad!
UBI (Universal basic income) doesn’t HAVE to be bad. There are a lot of different models, some better than others, and we need to find the one that works best. Several models of UBI depend on the “Federal budget is a closed system like your household accounts” model which is clearly incorrect because the federal budget is obviously only a small part of the Australian economy and should not be seen in isolation. I understand Bill Mitchell is opposed to UBI because there are so many social (and perhaps economic – this is where I fall behind – I’m no doubt oversimplifying again) benefits of everyone being able to have work. And agreed it could be mis-used by corporations wanting to pay less than a living wage. There have to be protections around it. But at the very least it would free the unemployed from the horrors of Centrelink robo-debt….
UBI doesn’t have to be bad… although I can’t help but think it will be rolled out here one day as a cashless welfare card from those lovely folk at Indue !
Oh. But lovely point about the market exchange being the model for all other “freedoms”.
Thanks H. My summer reading now settled.
I should have mentioned this, but don’t start with Polanyi. The other books are way more fun.