"up until 1974, workers generally had the upper hand". I would say they had an 'even hand'. From American data https://www.epi.org/productivity-pay-gap/ worker share of productivity exactly tracked productivity increase from 1947 to 1960, and was only slightly divergent from 1960-74. I imagine this divergence was a result of innovations such as containerisation and ro-ro shipping of vehicles allowing international trade to become much more competitive. There is a sharp turn in 1974 as you say. Financialisation became the big stick to beat the workers with, since it was possible to make money without the vicissitudes of industry. This probably also accounts for the contemporaneous fall in productivity from 2.5% p.a to 1.4% p.a. with all the brightest and most ambitious management material (as well as capital) being sucked into the finance sector rather than the industrial.
Pretty much the sole purpose of anything 'real' in this world such as natural resources, goods and non-financial services, land and housing only exist to provide a starting point upon which fictitious capital can be hypothecated. What could possibly go wrong?!
The whole thing appears to be unravelling in a fast and chaotic fashion. I don't think 'we' can do much but make plans to create something from the ashes (hopefully not nuclear ones). That's why I'm rather focussed on the political than the economic at the moment.
Spot on. The question of life is: what should I/"we" do (first/now)? The answer at this time in history* is to understand the world around us and prepare for the window of opportunity for change that only comes when old systems collapse.
Politics is about power in all its forms and how groups of people decide what they should do. Economics is about understanding the resources that we have at our disposal to achieve those goals so the two both important and closely linked.
*This of course has been true throughout history, but this time is indeed different. Humans have more power over this planet than ever before so the consequences of bad decisions are much greater. I share your hope that that enough sensible people remember the lessons of the past and that the ashes we rise from are those of the books on neoclassical economics 🤣
The keys are finding the new key/core APPLIED CONCEPT, i.e. the new paradigm, and then APPLYING/ACTING ON IT socially and politically. I'm sorry, as completely well analyzed and accurate as Steve's critique of neo-classicalism is...it doesn't rise to the applied conceptual/paradigmatic level.
The problem is the current MONOPOLY monetary paradigm of Debt ONLY and the multi-systemic solution is to strategically integrate the new paradigm of Direct and Reciprocal Monetary Gifting into the Debt Only system thus breaking up the monopoly character of the present paradigm and resolving the deepest problematic anomalies/realities that CONCEPT creates and enforces...in the economy and on 99% of the general populace.
Political activism is probably more important than economic analysis. I can understand the cynicism and anxiety, but all the more reason to get behind a policy program that doubles everyone's purchasing power, ends inflation by implementing beneficial price and asset deflation, ends the historical trend of private debt overwhelming domestic economies and transforms participating in the economy from frustration and anger into the greatest opportunity to self actualize gratitude for a gift of 50% of the price of everything? And then why not create a mass socio-economic and political movement to communicate and enact that program?
That is the right question, see my reply to Kevin below. Your answer has merit, but ignores the reason that neoclassical economics has such a hold on the economics profession: those in power like its conclusions. "They" will not let go of it and will keep explaining away the obvious flaws that Steve mentions until the whole system implodes as it inevitably must.
All of your critiques of neo-classical economic theory are valid. Full stop. But the deepest problem with it is the entire idea that "free" market theoretics enables COMPLETE FREEDOM...which in the human universe is a dangerous delusion...because the little thing known as ethics cannot RATIONALLY be escaped. So you're also correct that economic theory and economic actions must be rationally bounded.
"Free" market theoretics is a delusion and a misnomer for its actual reality which is alternately goosed and strangled unstable dominating monopolistic financial and monetary chaos...and the solution to that rather long adjective is to integrate the new monetary paradigm of Direct and Reciprocal Monetary Gifting into the Debt Only system with a 50% Discount/Rebate policy at retail sale instead of using the current ham handed methods utilized by neo-classically deluded central banks...and then rationally and ethically regulate the economy instead allowing a suave or unabashed financial and economic oligarchy to dominate the general populace for another 6000 years or maybe another 50 years until climate change kills off 4-5 billion of us.
We must "go deep, go long" on APPLIED conceptual/paradigmatic analysis because anything other than an ACTUAL paradigm change gets gamed and the clock is ticking very loudly.
"up until 1974, workers generally had the upper hand". I would say they had an 'even hand'. From American data https://www.epi.org/productivity-pay-gap/ worker share of productivity exactly tracked productivity increase from 1947 to 1960, and was only slightly divergent from 1960-74. I imagine this divergence was a result of innovations such as containerisation and ro-ro shipping of vehicles allowing international trade to become much more competitive. There is a sharp turn in 1974 as you say. Financialisation became the big stick to beat the workers with, since it was possible to make money without the vicissitudes of industry. This probably also accounts for the contemporaneous fall in productivity from 2.5% p.a to 1.4% p.a. with all the brightest and most ambitious management material (as well as capital) being sucked into the finance sector rather than the industrial.
Pretty much the sole purpose of anything 'real' in this world such as natural resources, goods and non-financial services, land and housing only exist to provide a starting point upon which fictitious capital can be hypothecated. What could possibly go wrong?!
Correct analysis. But what would you suggest we do about it?
The whole thing appears to be unravelling in a fast and chaotic fashion. I don't think 'we' can do much but make plans to create something from the ashes (hopefully not nuclear ones). That's why I'm rather focussed on the political than the economic at the moment.
Spot on. The question of life is: what should I/"we" do (first/now)? The answer at this time in history* is to understand the world around us and prepare for the window of opportunity for change that only comes when old systems collapse.
Politics is about power in all its forms and how groups of people decide what they should do. Economics is about understanding the resources that we have at our disposal to achieve those goals so the two both important and closely linked.
*This of course has been true throughout history, but this time is indeed different. Humans have more power over this planet than ever before so the consequences of bad decisions are much greater. I share your hope that that enough sensible people remember the lessons of the past and that the ashes we rise from are those of the books on neoclassical economics 🤣
The keys are finding the new key/core APPLIED CONCEPT, i.e. the new paradigm, and then APPLYING/ACTING ON IT socially and politically. I'm sorry, as completely well analyzed and accurate as Steve's critique of neo-classicalism is...it doesn't rise to the applied conceptual/paradigmatic level.
The problem is the current MONOPOLY monetary paradigm of Debt ONLY and the multi-systemic solution is to strategically integrate the new paradigm of Direct and Reciprocal Monetary Gifting into the Debt Only system thus breaking up the monopoly character of the present paradigm and resolving the deepest problematic anomalies/realities that CONCEPT creates and enforces...in the economy and on 99% of the general populace.
Political activism is probably more important than economic analysis. I can understand the cynicism and anxiety, but all the more reason to get behind a policy program that doubles everyone's purchasing power, ends inflation by implementing beneficial price and asset deflation, ends the historical trend of private debt overwhelming domestic economies and transforms participating in the economy from frustration and anger into the greatest opportunity to self actualize gratitude for a gift of 50% of the price of everything? And then why not create a mass socio-economic and political movement to communicate and enact that program?
That is the right question, see my reply to Kevin below. Your answer has merit, but ignores the reason that neoclassical economics has such a hold on the economics profession: those in power like its conclusions. "They" will not let go of it and will keep explaining away the obvious flaws that Steve mentions until the whole system implodes as it inevitably must.
All of your critiques of neo-classical economic theory are valid. Full stop. But the deepest problem with it is the entire idea that "free" market theoretics enables COMPLETE FREEDOM...which in the human universe is a dangerous delusion...because the little thing known as ethics cannot RATIONALLY be escaped. So you're also correct that economic theory and economic actions must be rationally bounded.
"Free" market theoretics is a delusion and a misnomer for its actual reality which is alternately goosed and strangled unstable dominating monopolistic financial and monetary chaos...and the solution to that rather long adjective is to integrate the new monetary paradigm of Direct and Reciprocal Monetary Gifting into the Debt Only system with a 50% Discount/Rebate policy at retail sale instead of using the current ham handed methods utilized by neo-classically deluded central banks...and then rationally and ethically regulate the economy instead allowing a suave or unabashed financial and economic oligarchy to dominate the general populace for another 6000 years or maybe another 50 years until climate change kills off 4-5 billion of us.
We must "go deep, go long" on APPLIED conceptual/paradigmatic analysis because anything other than an ACTUAL paradigm change gets gamed and the clock is ticking very loudly.