> > Both J. S. Mill and Keynes saw a steady state economy as both
> > feasible and desirable.
> so why did the keynesian model fail in the European
> countries after the sixties/seventies (stagflation)?
This post began as a simple re-telling of (what I think is)
Solow's answer to this question. But it grew beneath my fingers
into a more extended train of thought ... and I am loath to dump
it all and just leave the simple reply. If you have little
interest or no patience, just see what Solow had to say (if I'm
right ... sorry, no citations available; I heard this tale from a
visiting speaker) and skip the rest.
The answer which I have heard -- devised I believe by Robert Solow
(sp?) also of MIT -- is interesting in itself AND has a bearing on
our deliberations about economic theorizing and the future of of
history and work in general.
Solow's idea is, basically, that Keynesian state intervention was
thought up and introduced in a general context of NO significant
monetary intervention by the state. In this context, both capital
and labour tended (consciously or unconsciously) to be relatively
moderate in their demands (or "self-monitoring") since they knew
that excess could lead to economic distress and there was no power
to alleviate the damage. In this context of relative
self-restraint, Keynesianism *worked*.
But as Keysian intervention continued to be practiced, the context
(the reality) changed, for capital and labour could both say,
essentially, what the hell, we'll go for it, because the state can
always intervene and restore stability. In this NEW context --
reality had changed -- Keynesian intervention did not work as well
(or at all), and you got stagflation.
The GENERAL point, of course, is that economic theory, like all
social science theories, is reflexive -- it's both BY us and ABOUT
us -- and strange things can happen. In this case, if the story is
right, Keynesian theory started out being TRUE. But as a
consequence of being believed (after all, it worked), it became
FALSE!
I take it that this problem of self-referral is unavoidable in the
social sciences and the general picture of the status of our
self-understanding has some bearing on our deliberations about
WHAT IS POSSIBLE in the future. At the very least, this is what
makes it all so unclear and so contentious.
FOR EXAMPLE, I think that underneath the discussion, disagreement,
and (occassional) incomprehension between Jay, Eva, and Ray, what
is at issue is a view of human nature (gasp!) and what is possible
for humans. Jay's view seems to hinge importantly on biological
necessity -- our evolutionary legacy -- which he sees, I think, as
fundamentally unalterable. With some justification, Eva sees these
assumptions as essentially false (because too reductive) and
distressingly self-fulfilling -- if we BELIEVE that we have no
choice but to be agressively self-aggrandizing, then we have been
given permission, as it were, to BE that way.
Thus also Eva's impatience with repeated assertions from here,
there, and everywhere that Marxism has been tried and failed. As I
read it, a crucial part of Marx's theory is a historically driven
transformation in human consciousness of itself, without which one
gets tragedy and farce.
Without what Marx sees as an essentially *correct* (non-Darwinian)
understanding of ourselves as essentially social products and
producers -- a view which both looks ahead to a bright future and
belies his own debt to a tradition of political thought from
Aristotle to Hegel (AND ALSO sounds alot like the political theory
of indigenous people all over the place, if I have understood Ray
at all correctly) -- without this crucially transformed human
consciousness of itself, any socialist revolution will be
premature, so to speak, and just get it wrong, producing, for
example, not socialism or communism but a grotesque kind of state
capitalism (which I think is something like the right reading of
what happened in "eastern Europe").
"Tragedy and farce" are, I think then, a far more correct Marxist
verdict on the former Soviet Union than anything like simple
failure.
Almost everyone agrees that Marx gets it right about the moral
defects of capitalist modes of production -- defects which are
necessarily systemic -- and much of the history of the 20th
Century is about attempts to ameliorate these defects; resistance
to galloping globalization is the most recent version of this.
In this resistance, as in our prolonged discussions about the
future of work, I see (as through as glass darkly) the people of
the world engaged in that historical work and political struggle
which does involve, finally, questioning and reflecting upon our
very "nature" as human beings and leading to a transformed
understanding of ourselves, away from Darwinian individualism and
towards some version of "socialism". (Or so it seems to me.)
[On much of this, I highly recommend Richard c. Lewontin, _Biology
as Ideology: The Doctrine of DNA_, a nice set of lectures
orginally offered on the CBC, AND, as some years ago: John Dunn,
_Western Political Theory in Face of the Future_ (CUP in recently
issued 2nd edition) (whose view of Marxism I follow in many
respects).]
Thanks for your patience!
& best wishes for 1999
Stephen Straker
<[EMAIL PROTECTED]>
Vancouver, B.C.
