Marx: The formidable curmudgeon. Often attacked, rarely understood.
In its infancy—when economics was seen as "political economy"— it recognized such realities. It was, after all, the brainchild of moral philosophers and thinkers such as Adam Smith (far more often spuriously quoted than read), David Ricardo, T. Malthus, J.B. Say, Karl Marx, and others, who sought to discover laws of social organization that might grant humanity—at last—relief from misery, wars, endemic poverty and constant social friction. This period lasted about a full century, and then economics began to take a different coloration. As it matured it took the raiments of a self-conscious ideology for the young capitalist system, which was also receiving a fair boost from Calvinism. Eventually, it went from relevant ideology to apologetics, and from there, in accelerating degeneracy over the last fifty years, to something akin to theology. Orthodox economics is today so tautological as to be much closer to dogma than science. Lost in next to incomprehensible mathematical models, it seeks to deny its irrelevancy to the average citizen and scandalous subservience to the ruling orders by hiding behind ever more arcane and microscopic applications of its art in friendly venues: corporate corridors, academic towers, or other rarified precincts of the financial-capital sector that dominates the system. It is here that the misplaced focus of contemporary economics is revealed in all its squalid nakedness. For the individuals directly benefiting from such "knowledge" are relatively few, and their objectives and priorities often at loggerheads with the commonwealth's, but that doesn't seem to trouble most bourgeois economists who continue to research and write about economics from the favored perspective of their corporate patrons. Magnuson's text seeks to correct that focus, and return it to its proper place:
"It is rather shocking," says Magnuson, "that so little is written from the perspective of the billions whom this system damages every single day, or from the perspective of the planet it is destroying at an accelerating pace."
Magnuson is talking here about the central question of all economic, nay, all human activity: cui bono? Is the "economy"—this abstract entity we have been taught to respect as determined by inviolable natural laws—the servant of society (i.e., the vast majority), or the other way around? Do we work to make it happy or does it work to make us happy? The record is peculiar to say the least. To even have to pose the question is perhaps a reflection of how far we have strayed from common sense. The signs of the disorder are everywhere.
Man-made cultural fog—
Even allowing for the widespread (and shameful) economic illiteracy among media people, and the fact that even those who should know better are more interested in advancing their careers by dispensing lies and "getting along" with their bosses than telling it like it is, it's still amazing to observe the near unanimity with which in contemporary capitalist culture all manner of measures negatively afflicting the interests of the average citizen are routinely described as "necessary" and for "the good of the economy." No one ever poses the obvious question of why the vast majority of human beings must submit to the tyranny of this abstract Molloch, whose triumphs over the masses invariably bring Wall Street to paroxysms of delight. (Am I slandering the great American economy...this best of all possible worlds?)
David Ricardo, one of the great classical political economists. He might have been surprised—maybe shocked–by the irrelevancy of so much modern economics to the public interest.
Many readers of this essay may have probably noticed that under this curiously perverse economy, human happiness and the happiness of the markets seem to be perennially at odds...apparently entangled in a cosmic zero sum of Olympian proportions. When unemployment grows, Wall Street cheers. When factories are closed, or relocated to cheap-wage regions, when pensions are slashed, or stolen, when laws to protect the workers or the environment are defeated, when whole industries are taken over by opportunistic raiders...in sum, when human and planetary misery increase, or promise to increase...corporate valuations jump off the charts and a merry choir of mavens come out of the woodwork to celebrate the good news and help break out the champagne. If you think this spectacle is a bit insane, you're right. It is insane. Why do people, otherwise intelligent people, put up with such things? That, again, is where false consciousness and misleading instruction come in—reinforced by the cumulative sense of powerlessness that an "atomized" existence usually engenders. They present as logical and inevitable—even just–what is none of those things. So perhaps the urgent but still unasked question is this: just who is this mysterious "economy"? The truth emerges when we look behind the veil.
Omissions, falsehoods, shortcomings, and mystifications
found in mainstream economics
Although the subject is vast—and fairly technical at times—in chapter after chapter, Magnuson's book helps the reader to understand and question a large number of issues, get the big picture, and in so doing better comprehend the magnitude of the imposture represented by economics as taught to this day in most colleges across the Unites States and much of the world. For starters, Magnuson does not pretend to be analyzing some "universal and immutable laws of economics," forever true for all nations and epochs, but merely the anatomy of contemporary American capitalism, warts and all. Let's review a few topics that cry for (but never receive) proper attention.
Four major themes underscore Mindful Economics' panoramic view of capitalist activity:
• First, capitalism is a system; it's useless to try to patch this or that area, for, like a true living organism, all pieces function in unison, and its DNA can quickly reassert its antisocial tendencies, no matter how hard civil society tries to contain them; living with capitalism in our midst is like living with a sociopath that needs constant and careful watching—forever.• Capitalism is addicted to eternal and aggressive growth; this is a non-negotiable feature that defines it. You can make a man agree to many things, but you can't negotiate with him to stop breathing. That's a non-negotiable demand. Same with capitalism and growth. Constant growth is buried deep in the dynamic of capitalism and now in its mature executive sociology. It's not subject to negotiation. Yet —as anyone, except capitalist diehards and those influenced by them can see—eternal growth is impossible in a planet that is growing smaller all the time, especially against the backdrop of continually expanding human populations.
• Capitalism, a highly hierarchical, inegalitarian system did not clash with the exploitative values of feudalism. It merely forced it to amplify its privilege sphere to embrace the rising class of rich merchants—the bourgeoisie. Given this value orientation—and when we put self-serving propaganda aside—capitalism can be clearly perceived as inherently indifferent and even hostile to democracy. Capitalism simply thrives in right-wing dictatorships. Chomsky calls capitalist structures "tyrannies" and he's not exaggerating.
• As time goes by, the capitalist crisis —the disappearance of jobs, environmental degradation, deeper recessions and inequality, antisocial production, etc.—grows in intensity and there is no possible cure within boundaries acceptable to the capitalist class.
That may be desirable for this tiny minority, but for the rest of us the only cure for capitalism is to transcend it. Space constraints do not allow an in-depth review of these issues and their numerous ramifications, all of which are treated in an extremely lucid format by Magnuson, but a short discussion may suffice here for the reader to get a sense of what is involved.
The scandal of the GDP Fetish
From Lou Dobbs to Alan Greenpan, to the regular business class teacher, the media "expert" trotted out to "explain the economy," the corporate executive, or politico on the stump, the mantra is always the same: the GDP is a fine barometer of the nation's economy, and it better be growing. But this worship of the GDP [Gross Domestic Product] as a reliable yardstick for general social well-being, intimately connected to the growth obsession, is just one of the multiple ways in which bourgeois economics contributes to the miasma of false consciousness that envelops the average person in capitalist society. The operating assumption is that there's a close correlation between more and more economic growth and increases in the quality of life for all, but there are several enormous flies in this lovely ointment.
To begin with, a bigger GDP does not automatically mean a better life for the vast majority. The truth depends on how the national income is being distributed. Forget the fabled "trickled down" effect and "the lifting of all boats" economic rapture expected to take place when the superrich are allowed to get away with practically anything. Unadulterated poppycock. A smaller pie in which everyone gets a fair share is probably much better than a much larger pie in which 5% of the top take 90% of the pie. What's more, averages, so widely used in official statistics, lie. Consider a society comprised of two people. One has an income of $1 million dollars. The other, only $1,000. The average income indicator would tell us that both are doing terrific, at $500,500 each. This is an extremely simplified snapshot, a fantasy if you will—who ever heard of a nation comprised of only two people—but the lesson is true insofar as the application of the sacred tools of mainstream economics are concerned. Worse still, the GDP takes no account of increasing social inequality, widespread environmental pollution, or damage to people's health as a result of industrial practices. It's also stubbornly blind to many realities that underscore the best things in life not only for us, but for every sentient creature on earth—like the pure oxygen that a beautiful tree quietly affords us, or the advantages, let alone wonderfulness, of clean rivers and oceans—while it computes as "gains" things that in actuality represent tragedy and loss. Thus a crackup on the highway resulting in someone's death and somebody else's prolonged hospital stay, a totaled vehicle, and so forth, turns up on the capitalist ledgers as income generated for hospitals, doctors, nurses, drug companies, garages, funeral parlors, and car dealerships. Similarly, the GDP robotically celebrates any construction, whether it be of prisons or family homes. And following the same logic, it treats crime, divorce and other elements of social breakdown as economic gains. It's a measurement model in urgent need of revamping.
Measuring all economic and societal "success" by a materialistic yardstick of constant growth, capitalism suffers from a compulsion to expand infinitely in what is clearly a very finite world, thereby betraying in its dynamic something akin to systemic madness. Expansion at all costs is fueled by a well-developed culture of 'short-termers"—the notion of a true capitalist statesman is ludicrous—and a self-perpetuating, self-selecting, macho executive sociology according to which career advancement is only possible on the basis of--again--constant growth, plus aggressive competition in the boardroom jungle. Unfortunately for society, these so-called "captains of industry"— like the political class they resemble—are characterized by having as much power as obtuseness. The world will not be led out of the crisis by them because, to recall Herzen's famous dictum, "they are not the cure, they're the disease." The tragedy is, for them and for us, that they will never admit it because in their hubris they can't see the actual consequences of their actions, never will, and probably don't care. Such acquired myopia, of course, the product of multiple layers of insulation from reality on the back of obscene wealth (one more demonstration of existence and character determining consciousness), doesn't mitigate the fact that the earth is being destroyed at a rapid clip, human-caused species extinction is at an all-time historical high and accelerating, many cataclysmic wars are in the offing (over deeper and vaster exploitation of human and natural resources), while industrialism continues to extend itself over the planet like an unstoppable raging cancer. Quite an accomplishment, for an species that only "yesterday", in geologic time, climbed out of the primordial soup.