Ray,
I don't know precisely where you got Paul Krugman's article ("For Richer")
from but it's a substantial essay for which, many thanks for posting to us.
Harry's quite right. Krugman points the finger but makes no attempt to
understand, least of all, explain, the phenomenon of inequality. This is
why Krugman is an economic journalist only -- albeit an excellent one --
but not an economist.
Indeed, in my view, most present-day "economists" are not economists at
all, but only econometricists. They attempt to describe and measure the
economy but not to understand it in any fundamental way. All the
"economists" we can think of during, roughly, the last century have been
either econometricists or economic journalists of greater or lesser
brilliance, and have given insights of greater or lesser relevance. None of
them actually got to the root of the matter, least of all Keynes who was
merely a Bloomsbury, quasi-Fabian elitist.
For real economists, we still have to go back to the geniuses of the
subject, to those who grappled with economics within the context of the
other big issues of the human condition -- of demographics, politics,
trade, disease, cultural differences and so on. They were polymaths more
than merely economists. We have to skip over many "economists" of the last
century who dwelt on, and burnished, one or two facets of the subject and
go back to Marx, Ricardo, Malthus, Smith, Say . . . all the way to
Aristotle (though there must have been a few before him who have gone
unrecorded). Even though some of the true economists of the past may have
gone wildly wrongly -- wholly or partially -- it is only these, with both a
wide and deep view of economics within the whole field of human activity
who can be called true economists.
Harry calls the pretenders of the last century "neo-classical economists".
He also has his own hero, George. However, none of these seem to be
interested in the other great human sciences which have also been advancing
during the course of the last century. Or, if they are aware of them, they
haven't made any attempt to enfold their subject within the larger view as
the geniuses of the past would have done. None of them has considered
evolution, for example. Certainly no current "economist" wants to talk
about anthropology, of the relative productivities of the three great
economic systems so far (hunter-gathering, agriculture, industrialisation),
of the genetic motivations within all of us, etc.
Just as the subject of economics in its heyday was not called economics,
but "political philosophy", so I think that the "economics" of the future
will actually emerge via another subject, and another discipline. A more
balanced and deeper view of economics might well be supplied by a future
anthropologist or a geneticist, for example, or some brand new discipline.
You might well say: "But what has this got to do with the inequalities that
Krugman describes?". I would suggest that a relevant theory of economics
would involve more than a passing reference to the similarity of our genes.
Or, in simple, terms, let's not demonize rich people (even though some of
them may not be attractive specimens) because anyone of us would readily
accept the opportunity to be very rich.
Instead, we need a deep enquiry into the way that inequality has waxed and
waned throughout the history and pre-history of man. It's not a new
phenomenon at all. I get the impression that inequality rises steeply
whenever there's a surge in productivity due to new energy sources or
significant innovations, but declines in-between times. This hypothesis
needs much more analysis than I can possibly give it here but I could
illustrate this briefly in terms of the period Krugman describes by
suggesting that the extremes of inequality in America at around the 1880 --
the robber baron era -- was caused by the immense strides in industrial
productivity that were brought about by rapid expansion of coal mining and
railway transportation. The more recent increase in inequality can be
explained, in my mind, by the vast expansion in access to cheap oil, and
more recently gas, since the 1950/60s.
The intriguing question to ask, of course, is what will happen to
equality/inequality when oil and gas start giving out during the next 20/30
years? It think we can't possibly answer that until we know what the next
energy technology is going to be. If civilisation is going to continue in
some form or other, the new technology will have to be a huge one in order
to replace the enormous role of oil and gas at present. I think it's going
to depend very much on what sort of investment is going to be required. Is
it going to need finance in the main (as needed today in, say, in
developing an oil field), or will it be a mixture of finance and a high
level of intellectual know-how? If the former, then the new energy
technology will throw up yet another surge in inequality, I'm sure; if the
latter, then there's a chance that the new prosperity will be more evenly
dispersed (so long as the already-rich don't monopolise access to knowledge
by means of intellectual copyright).
Keith
----------------------------------------------------------------------------
------------
Keith Hudson, General Editor, Handlo Music, http://www.handlo.com
6 Upper Camden Place, Bath BA1 5HX, England
Tel: +44 1225 312622; Fax: +44 1225 447727; mailto:[EMAIL PROTECTED]
________________________________________________________________________
