The Future of Neoliberalism

[Rippounet]

13 minutes ago, sologdin said:

correlation with trade (its benefits) specifically?

that's how i read the hypothesis.  

what are the quantitative metrics or qualitative criteria for this project? 

I've read this hypothesis before somewhere, but I think it was linked to the urban-rural divide and the fact that urban folks benefit more from trade and multiculturalism (or at least more visibly so).

Edit: also, in the US there's obviously a coastal-inland divide.

Also, I was somewhat trying to tease two of my favorite boarders at once, it felt like an opportunity that shouldn't be missed.

[OldGimletEye]

On 5/19/2020 at 1:51 PM, sologdin said:

i associate neoliberalism with bipartisan 'washington consensus' policies:  trade and investment liberalization, privatization, deregulation, and so on--which come to their apex in structural adjustment programs as backed by militaristic "humanitarian intervention"--mailed gauntlet over the invisible hand.

Neo liberalism is one of those terms that can be quite slippery and it's hard to know what is neo-liberal and what is not. And it even has become a pejorative among leftist, with some leftist accusing other leftist as being neo-liberal, when in the opinion of some leftist other leftist are too market friendly.

But, I'll define neoliberalism as the marketing and promotion of the of competitive partial equilibrium model (the econ 101 model) as the true representation of all markets. This promotion was obviously done by people with an extreme anti-government philosophy (where economic matters were concerned at least) and a number of the wealthy. James Kwak, in Economism, gives a pretty good account of this.

Relatedly, the Arrow or Radner equilibrium became the engine of a class of economic models, in particular RBC models that gained a lot of influence. The Arrow or Radner general equilibrium model stands for the proposition that if there is enough securities that payoff for every state of the world (the securities are called Arrow Securities. And where there are as many Arrow Securities as states it is called a complete market) and people form correct price expectations about spot markets then the economy will obtain to a Pareto efficient outcome.

In the real world there is likely to be missing security markets, and I'd argue the labor market is largely a missing market in the sense that no price vector can clear it, leading to potential equilibrium that are not pareto optimal, which implies government involvement can be defended.

In nutshell, then I'd define neoliberalism as using two models to explain how the world works, but in fact are not a realistic description of it.

[OldGimletEye]

9 hours ago, Rippounet said:

I've read this hypothesis before somewhere, but I think it was linked to the urban-rural divide and the fact that urban folks benefit more from trade and multiculturalism (or at least more visibly so).

Urban areas are more likely to have external economies of scale with products or services where there is comparative advantage, which means their average cost of production decline as demand increases. For an example, think New York and London with finance.

And people in professional occupations, who are probably more likely to reside in urban areas, likely experience a higher degree of their labor being complemented by immigrant labor, so long as the immigrant labor is blocked from certain labor markets because of professional licensing requirements, language and cultural barriers, or formal education requirements.

[OldGimletEye]

10 hours ago, sologdin said:

correlation with trade (its benefits) specifically?

that's how i read the hypothesis.  

what are the quantitative metrics or qualitative criteria for this project? 

Correlation with trade is what I specifically meant. The education gap, while an interesting phenomena is well known and appears, to my knowledge, to have happened in several countries.

In so far as testing the theory, while I don't have an exact quantitative model in mind, which would likely be some kind of regression specification, I'd probably start by looking at correlations between college graduates in the Democratic Party and support for trade or looking at time series of those two pieces of data.

[DMC]

Apologies for the delayed response, this thread totally slipped my mind for some reason.

On 5/20/2020 at 10:40 AM, Rippounet said:

Hmmm... Are both of you too lazy to google or do I misunderstand what you're talking about?

http://piketty.pse.ens.fr/files/Piketty2019.pdf

https://www.theatlantic.com/education/archive/2018/11/education-gap-explains-american-politics/575113/

There's lots of those lying around... Unless you want to find a correlation with trade (its benefits) specifically?

Piketty might be an (the?) academic rockstar, but as far as I can tell he doesn't say anything specifically about free trade and education level among Americans.  There are, admittedly, people that have looked at this - including close colleagues.  I was mainly jesting with OGE, although if I tried hard I bet I could find a lacuna in the lit to construct a unique research design/dataset.

On 5/20/2020 at 10:57 AM, sologdin said:

what are the quantitative metrics or qualitative criteria for this project? 

The DV would be attitudes on free trade and the primary IV would be education levels interacted with partisanship, over time.  

On 5/20/2020 at 11:10 AM, Rippounet said:

I've read this hypothesis before somewhere, but I think it was linked to the urban-rural divide and the fact that urban folks benefit more from trade and multiculturalism (or at least more visibly so).

Edit: also, in the US there's obviously a coastal-inland divide.

Also, I was somewhat trying to tease two of my favorite boarders at once, it felt like an opportunity that shouldn't be missed.

First, yes, I even remember right before the 2016 election attending a presentation organized by my program in which some Georgetown economist linked the impact of trade by state to vote share - and in doing so predicted a Trump victory, which did not go over well in the room.  Could probably look that paper up in a few minutes if you're interested.

Second, I will have to figure out some way to tease you back now!

On 5/19/2020 at 1:51 PM, sologdin said:

i associate neoliberalism with bipartisan 'washington consensus' policies:  trade and investment liberalization, privatization, deregulation, and so on--which come to their apex in structural adjustment programs as backed by militaristic "humanitarian intervention"--mailed gauntlet over the invisible hand.

I think from Bretton Woods to the domino theory to Reaganism this is an incredibly accurate description.

[OldGimletEye]

27 minutes ago, DMC said:

 First, yes, I even remember right before the 2016 election attending a presentation organized by my program in which some Georgetown economist linked the impact of trade by state to vote share - and in doing so predicted a Trump victory, which did not go over well in the room.  Could probably look that paper up in a few minutes if you're interested.

There have been a number of papers linking Chinese import penetration with shifting voter attitudes to the right. Not only does that seem to hold in the United States, but also in Europe.

[Rippounet]

2 hours ago, DMC said:

Piketty might be an (the?) academic rockstar, but as far as I can tell he doesn't say anything specifically about free trade and education level among Americans.

2 hours ago, DMC said:

Second, I will have to figure out some way to tease you back now!

That's being nice. But as you point out, my teasing was off the mark, or to put it differently, I tried to play smartass and failed.

Anyway, since we're talking about neoliberalism and colleagues here, this is what my colleagues have been sharing these last few days:

Quote

 

https://theintercept.com/2020/05/08/andrew-cuomo-eric-schmidt-coronavirus-tech-shock-doctrine/

In short, democracy — inconvenient public engagement in the designing of critical institutions and public spaces — was turning out to be the single greatest obstacle to the vision Schmidt was advancing, first from his perch at the top of Google and Alphabet and then as chair of two powerful boards advising Congress and Department of Defense. As the NSCAI documents reveal, this inconvenient exercise of power by members of the public and by tech workers inside these mega-firms, has, from the perspective of men like Schmidt and Amazon CEO Jeff Bezos, maddeningly slowed down the AI arms race, keeping fleets of potentially deadly driverless cars and trucks off the roads, protecting private health records from becoming a weapon used by employers against workers, preventing urban spaces from being blanketing with facial recognition software, and much more.

Now, in the midst of the carnage of this ongoing pandemic, and the fear and uncertainty about the future it has brought, these companies clearly see their moment to sweep out all that democratic engagement. To have the same kind of power as their Chinese competitors, who have the luxury of functioning without being hampered by intrusions of either labor or civil rights.

[...]

In each case, we face real and hard choices between investing in humans and investing in technology. Because the brutal truth is that, as it stands, we are very unlikely to do both. The refusal to transfer anything like the needed resources to states and cities in successive federal bailouts means that the coronavirus health crisis is now slamming headlong into a manufactured austerity crisis. Public schools, universities, hospitals, and transit are facing existential questions about their futures. If tech companies win their ferocious lobbying campaign for remote learning, telehealth, 5G, and driverless vehicles — their Screen New Deal — there simply won’t be any money left over for urgent public priorities, never mind the Green New Deal that our planet urgently needs.

On the contrary: The price tag for all the shiny gadgets will be mass teacher layoffs and hospital closures.

I don't know how relevant this is to the future of neoliberalism exactly, but it's certainly food for thought. Klein underlines several tendencies that are certainly linked to neoliberalism:
- A desire to sidestep democracy.
- Transferring public services to large corporations.
- Using "smart" objects and automation to make most workers redundant.

On a good day I wouldn't see anything sinister in the last one, and might even be enthusiastic about some evolutions (driverless vehicles? Fuck yeah). But people close to me have convinced me that there is a very dark potential in those converging trends: that making human workers unnecessary in an age of exploding inequality can easily lead to a dystopian future. It is a recurring theme in Sci-Fi (Gunnm, Elysium, Altered Carbon... ), various thinkers do mention it as a threat (Harari, Klein... ), and some of the billionaires very clearly want that (Peter Thiel... ) while others seek to be prepared in case of a civilisational collapse... All this begs the question: what if the future of neoliberalism, its "endgame" is getting rid of most people? Not just as an unintended consequence but as a logical, premeditated outcome?

[DMC]

19 minutes ago, Rippounet said:

I don't know how relevant this is to the future of neoliberalism exactly, but it's certainly food for thought. Klein underlines several tendencies that are certainly linked to neoliberalism:
- A desire to sidestep democracy.
- Transferring public services to large corporations.
- Using "smart" objects and automation to make most workers redundant.

Certainly agree with the latter two.  I'm not sure "neoliberals," or the elites that guide the invisible hand to their own dicks, have much of a problem with democracy.  Democracy, in the long run, provides stability.  So they're ok with that.  As long as they can manipulate what "democracy" means to their advantage.  And let's dispense with any illusions - all major states are republics (or worse), not democracies.  Gotta go back to ancient Greece for that.

24 minutes ago, Rippounet said:

All this begs the question: what if the future of neoliberalism, its "endgame" is getting rid of most people? Not just as an unintended consequence but as a logical, premeditated outcome?

I dunno.  I think we may well be headed to a dystopian future, sure - who couldn't think that?  But to contend it's by design by anyone.  Frankly I don't think those fucks are smart enough to pull such a thing off.

[Rippounet]

2 minutes ago, DMC said:

I'm not sure "neoliberals," or the elites that guide the invisible hand to their own dicks, have much of a problem with democracy.  Democracy, in the long run, provides stability.  So they're ok with that.  As long as they can manipulate what "democracy" means to their advantage.  And let's dispense with any illusions - all major states are republics (or worse), not democracies.  Gotta go back to ancient Greece for that.

That's my mistake (the word "democracy" is ambiguous). I should have written "sidestep the popular will."
Though of course that's absolutely not specific to neoliberalism.

2 minutes ago, DMC said:

I dunno.  I think we may well be headed to a dystopian future, sure - who couldn't think that?  But to contend it's by design by anyone.  Frankly I don't think those fucks are smart enough to pull such a thing off.

Again, kinda my mistake. By "premeditated" I don't mean that it's a design. As you say, no one would be able to pull this off.
But at this point everyone can see where we're headed (broadly speaking) so one can assume that many (if not most) of the people who do have some kind of power do not feel threatened by the outcome, or might even be fine with it.
I suppose one could call this "negligent genocide" or "genocide by negligence."
That isn't necessarily specific to neoliberalism either, but neoliberalism makes it so likely that it might be possible to argue it is one of its defining features.

[Altherion]

2 hours ago, Rippounet said:

Anyway, since we're talking about neoliberalism and colleagues here, this is what my colleagues have been sharing these last few days:

While I'm wary of the Tech Lords, this article does not offer an alternative -- or rather, it offers alternatives, but the alternatives it offers are so implausible that everyone making policy will simply dismiss them out of hand. For example:

Quote

And while there is no doubt that the ability to teleconference has been a lifeline in this period of lockdown, there are serious debates to be had about whether our more lasting protections are distinctly more human. Take education. Schmidt is right that overcrowded classrooms present a health risk, at least until we have a vaccine. So how about hiring double the number of teachers and cutting class size in half? How about making sure that every school has a nurse?

Doubling the number of teachers and dividing the day into shifts would indeed solve the problem, but this strategy has several glaring flaws. The two lesser ones are that one of the primary purposes (perhaps even the primary purpose) of schools is daycare and that it's difficult to train so many teachers over the course of a summer. The greater one (and this is true of the rest of his alternatives) is that this would be insanely expensive at the best of times and it's simply not possible when the tax base has been decimated. More generally, regarding this:

2 hours ago, Rippounet said:

In each case, we face real and hard choices between investing in humans and investing in technology.

These choices are not choices at all because investing in humans is one or more orders of magnitude more expensive than investing in technology.

[Rippounet]

I don't disagree with your points (I also thought doubling the number of teachers was a rather silly proposition), however:

10 hours ago, Altherion said:

These choices are not choices at all because investing in humans is one or more orders of magnitude more expensive than investing in technology.

This is debatable.
Investing in humans is "expensive" in purely financial terms, especially in developed countries where higher education has a price tag.
If you take a step back however, investing in humans is actually both cheap and rewarding (for humans ^^). A couple of humans can train an entire group for relatively complex tasks in a matter of months, and each individual human can then improve their training and innovate.
And we have an abundance of humans really.
Whereas conversely, raw materials are not infinite and robots will always have limits... Limits that it may be best not to seek to overcome too.

So I dunno. I mean, I'm pretty enthusiastic about technology, but at this point in time investing in humans seems pretty smart.

[Targknight]

Everyone in the future would be right wing. America will become super right like Chechnya is currently.