Category Archives: Book review

The world is running out of time

By Bertrand Badré – In 2015, the international community launched a renewed effort to tackle collective global challenges under the auspices of the United Nations Sustainable Development Agenda and the Framework Convention on Climate Change (COP21). But after an initial flurry of interest, the progress that has been made toward achieving the Sustainable Development Goals and tackling climate change has tapered off. Around the world, many seem to have developed an allergy to increasingly stark warnings from the UN and other bodies about accelerating species extinctions, ecosystem collapse, and global warming.

Now is not the time to debate whether progress toward global goals is a matter of the glass being half-full or half-empty. Soon, there will no longer even be a glass to worry about. Despite global news coverage of civic and political action to address our mounting crises, the underlying trends are extremely frightening.

For decades, most of the major economies have relied on a form of capitalism that delivered considerable benefits. But we are now witnessing the implications of the Nobel laureate economist Milton Friedman’s famous mantra: “the social responsibility of business is to increase its profits.”

A corporate-governance model based on maximizing shareholder value has long dominated our economic system, shaping our accounting frameworks, tax regimes, and business-school curricula.

But we have now reached a point where leading economic thinkers are questioning the fundamentals of the prevailing system. Paul Collier’s The Future of CapitalismJoseph E. Stiglitz’s People, Power, and Profits, and Raghuram G. Rajan’s The Third Pillar all offer comprehensive assessments of the problem.

A capitalist system that is disconnected from most people and unmoored from the territories in which it operates is no longer acceptable. Systems do not work in isolation. Eventually, reality asserts itself: global trade tensions reemerge, populist nationalists win power, and natural disasters grow in frequency and intensity.

Simply put, our approach to capitalism has exacerbated previously manageable social and environmental problems and sowed deep social divisions. The explosion in inequality and the laser focus on short-term results (that is, quarterly earnings) are just two symptoms of a broken system. more>

The information arms race can’t be won, but we have to keep fighting

By Cailin O’Connor -Arms races happen when two sides of a conflict escalate in a series of ever-changing moves intended to outwit the opponent. In biology, a classic example comes from cheetahs and gazelles. Over time, these species have evolved for speed, each responding to the other’s adaptations.

One hallmark of an arms race is that, at the end, the participants are often just where they started. Sometimes, the cheetah catches its prey, and sometimes the gazelle escapes. Neither wins the race because, as one gets better, so does its opponent. And, along the way, each side expends a great deal of effort. Still, at any point, the only thing that makes sense is to keep escalating.

Arms races happen in the human world too. The term arms race, of course, comes from countries at war who literally amass ever-more sophisticated and powerful weapons. But some human arms races are more subtle.

As detailed in the Mueller report – but widely known before – in the lead-up to the 2016 presidential election in the United States, the Russian government (via a group called the Internet Research Agency) engaged in large-scale efforts to influence voters, and to polarize the US public. In the wake of this campaign, social-media sites and research groups have scrambled to protect the US public from misinformation on social media.

What is important to recognize about such a situation is that whatever tactics are working now won’t work for long. The other side will adapt. In particular, we cannot expect to be able to put a set of detection algorithms in place and be done with it. Whatever efforts social-media sites make to root out pernicious actors will regularly become obsolete.

The same is true for our individual attempts to identify and avoid misinformation. Since the 2016 US election, ‘fake news’ has been widely discussed and analyzed. And many social-media users have become more savvy about identifying sites mimicking traditional news sources. But the same users might not be as savvy, for example, about sleek conspiracy theory videos going viral on YouTube, or about deep fakes – expertly altered images and videos.

What makes this problem particularly thorny is that internet media changes at dizzying speed. more>

The Surveillance Threat Is Not What Orwell Imagined

By Shoshana Zuboff – George Orwell repeatedly delayed crucial medical care to complete 1984, the book still synonymous with our worst fears of a totalitarian future — published 70 years ago this month.

Since 1984’s publication, we have assumed with Orwell that the dangers of mass surveillance and social control could only originate in the state. We were wrong. This error has left us unprotected from an equally pernicious but profoundly different threat to freedom and democracy.

For 19 years, private companies practicing an unprecedented economic logic that I call surveillance capitalism have hijacked the Internet and its digital technologies. Invented at Google beginning in 2000, this new economics covertly claims private human experience as free raw material for translation into behavioral data. Some data are used to improve services, but the rest are turned into computational products that predict your behavior.

These predictions are traded in a new futures market, where surveillance capitalists sell certainty to businesses determined to know what we will do next. This logic was first applied to finding which ads online will attract our interest, but similar practices now reside in nearly every sector — insurance, retail, health, education, finance and more — where personal experience is secretly captured and computed for behavioral predictions. By now it is no exaggeration to say that the Internet is owned and operated by private surveillance capital.

In the competition for certainty, surveillance capitalists learned that the most predictive data come not just from monitoring but also from modifying and directing behavior. more>

How Adam Smith became a (surprising) hero to conservative economists

By Glory M Liu – People like to fight over Adam Smith. To some, the Scottish philosopher is the patron saint of capitalism who wrote that great bible of economics, The Wealth of Nations (1776). Its doctrine, his followers claim, is that unfettered markets lead to economic growth, making everyone better off. In Smith’s now-iconic phrase, it’s the ‘invisible hand’ of the market, not the heavy hand of government, that provides us with freedom, security and prosperity.

To others, such as the Nobel prizewinning economist Joseph Stiglitz, Smith is the embodiment of a ‘neoliberal fantasy’ that needs to be put to rest, or at least revised. They question whether economic growth should be the most important goal, point to the problems of inequality, and argue that Smith’s system would not have enabled massive accumulations of wealth in the first place. Whatever your political leanings, one thing is clear: Smith speaks on both sides of a longstanding debate about the fundamental values of modern market-oriented society.

But these arguments over Smith’s ideas and identity are not new. His complicated reputation today is the consequence of a long history of fighting to claim his intellectual authority.

Smith’s first biographer, Dugald Stewart, deliberately portrayed him in the 1790s as an introverted, awkward genius whose magnum opus was an apolitical handbook of sorts. Stewart downplayed Smith’s more politically subversive moments, such as his blistering criticism of merchants, his hostility towards established religion, and his contempt for ‘national prejudice’, or nationalism. Instead, Stewart shined a spotlight on what he believed was one of ‘the most important opinions in The Wealth of Nations’: that ‘Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice; all the rest being brought about by the natural course of things.’

Stewart’s biography (first delivered as an eulogy in 1793, then published in 1794 and 1795) appeared in the wake of major events that terrified British audiences: the French Revolution of 1789, the Reign of Terror that followed and the sedition trials that followed in both England and Scotland. As the British historian Emma Rothschild has shown, Stewart’s depiction of Smith’s ideas cherrypicked in order to imbue political economy with scientific authority. She writes that he wanted to portray political economy as ‘an innocuous, technical sort of subject’, to help construct a politically ‘safe’ legacy for Smith during politically dangerous times. Stewart’s effort marked the beginning of Smith’s association with ‘conservative economics’.

Smith would soon earn a reputation as the father of the science of political economy – what we now know as economics. more>

Welcome to GAFA land—where the winner takes it all

By Susanne Wixforth – Amazon symbolizes the four platform giants, also known as GAFA (Google, Apple, Facebook and Amazon). The company is Europe’s largest platform retailer and its turnover is twice as high as that of its 20 largest competitors. While Amazon´s chief executive earned 2.16 million dollars per hour in 2017, its workers must be grateful if they receive the statutory minimum wage, which in the EU varies between €1.42 and €11.27 per hour.

In 2018, Amazon generated a turnover of about 210 billion euro worldwide, an increase of over 30 per cent on the previous year’s. The company has more than 600,000 employees across the globe. With a market capitalization of more than 730 billion euro, it is one of the most valuable listed companies. Its operating profit amounts to around 11 billion euro. Nevertheless, thanks to a ruling it had agreed on in advance with the tax authorities of Luxembourg, Amazon did not pay taxes on 75 per cent of its turnover between 2003 and 2014.

In the long run, the platform economy not only poses a risk to the stability and budgets of countries where the corporations earn their money but do not pay taxes—it also undermines social cohesion.

Amazon generates its turnover mainly through four channels: as one of the biggest online retailers, as the operator of by far the largest online marketplace for third-party suppliers, as one of the largest providers of online services and as the distributor of the ordered products.

Because of its large market power in some trading segments, independent traders depend on Amazon to reach their customers. There is evidence that Amazon is trying to force traders out through its sheer market power, for instance through copying products and undercutting prices. more>

Was the Rise of Neoliberalism the Root Cause of Extreme Inequality?

Financial meltdown, environmental disaster and even the rise of Donald Trump – neoliberalism has played its part in them all.
By George Monbiot – Imagine if the people of the Soviet Union had never heard of communism.

The ideology that dominates our lives has, for most of us, no name. Mention it in conversation and you’ll be rewarded with a shrug. Even if your listeners have heard the term before, they will struggle to define it. Neoliberalism: do you know what it is?

Its anonymity is both a symptom and cause of its power. It has played a major role in a remarkable variety of crises: the financial meltdown of 2007‑8, the offshoring of wealth and power, of which the Panama Papers offer us merely a glimpse, the slow collapse of public health and education, resurgent child poverty, the epidemic of loneliness, the collapse of ecosystems, the rise of Donald Trump. But we respond to these crises as if they emerge in isolation, apparently unaware that they have all been either catalyzed or exacerbated by the same coherent philosophy; a philosophy that has – or had – a name. What greater power can there be than to operate namelessly?

So pervasive has neoliberalism become that we seldom even recognize it as an ideology. We appear to accept the proposition that this utopian, millenarian faith describes a neutral force; a kind of biological law, like Darwin’s theory of evolution. But the philosophy arose as a conscious attempt to reshape human life and shift the locus of power.

Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.

Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimized, public services should be privatized. The organization of labor and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers.

Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve. more>

Why no-platforming is sometimes a justifiable position

By Neil Levy – The discussion over no-platforming is often presented as a debate between proponents of free speech, who think that the only appropriate response to bad speech is more speech, and those who think that speech can be harmful. I think this way of framing the debate is only half-right. Advocates of open speech emphasize evidence, but they overlook the ways in which the provision of a platform itself provides evidence.

No-platforming is when a person is prevented from contributing to a public debate, either through policy or protest, on the grounds that their beliefs are dangerous or unacceptable.

Open-speech advocates highlight what we might call first-order evidence: evidence for and against the arguments that the speakers make. But they overlook higher-order evidence.

Higher-order evidence is evidence about how beliefs were formed. We often moderate our confidence in our beliefs in the light of higher-order evidence. For instance, you might find the arguments in favor Continue reading

Socialism: A short primer

By E.J. Dionne, Jr. and William A. Galston – Something new is happening in American politics.

Although most Americans continue to oppose socialism, it has reentered electoral politics and is enjoying an upsurge in public support unseen since the days of Eugene V. Debs.

The three questions we will be focusing on are: Why has this happened? What does today’s “democratic socialism” mean in contrast with past versions? And what are the political implications?

It’s worth recalling how important socialism once was at the ballot box to understand that this tradition has deeper roots in our history than many imagine. In the 1912 presidential election, Debs secured six percent of the popular vote, and Socialists held 1,200 offices in 340 cities, their ranks including 79 mayors.

The crash of 2008, rising inequality, and an intensifying critique of how contemporary capitalism works has brought socialism back into the mainstream—in some ways even more powerfully than in Debs’ time, since those who use the label have become an influential force in the Democratic Party.

Running as a democratic socialist, Sen. Bernie Sanders received 45 percent of the Democratic primary vote in 2016, and in the 2018 mid-term elections, members of Democratic Socialists of America were among the prominent Democratic victors. Their ranks included Alexandria Ocasio-Cortez, who quickly became one of the country’s best-known politicians.

The economic and financial collapse of 2008-2009 undermined the claim that the economy had entered a new era of stability and moderation. Experts who had preached the virtues of self-regulation were forced to recant. The slow recovery from the Great Recession left many Americans wondering whether they would ever regain the income and wealth they had lost. more>

How to Avoid a Fascist Future

BOOK REVIEW

Being Numerous: Essays on Non-Fascist Life, Author: Natasha Lennard.

By Bradley Babendir – This idea runs through Being Numerous, a collection of essays that seek to demonstrate and enact a means of non-fascist thinking. Lennard approaches a range of subjects as part of this project, from the controversy over someone punching Richard Spencer, to representations of dead bodies in media, to suicide. Each essay is rooted in Lennard’s foundational argument that “liberal, capitalist ideology … fails to address its own potential accidents and limitations.”

The first essay, “We, Anti-Fascists,” is a forceful piece in favor of anti-fascist organizing and thinking. Lennard opens the essay with an endorsement of the on-the-ground counter-violence of Antifa, and makes a convincing case for the necessity of such violence when traditional institutions cannot be trusted to protect counter-protesters. She also argues against the overreaction to Antifa by mainstream American media after the Unite the Right rally in Charlottesville, Virginia, in 2017, after which, Lennard says, newspapers spent more page-space condemning anti-fascists than they did the white nationalists who had murdered the civil-rights activist Heather Heyer.

This defense of Antifa is perhaps the part of the essay that will grab most readers’ attention, but Lennard’s subsequent exploration of what she calls “fascistic habit” is its liveliest and most engaging section. more>

Too much theory leads economists to bad predictions

By Peter A Coclanis – In economics, as a result, both economic history and (especially) the history of economic thought withered for a generation or two.

So what accounts for the recent change of course? For starters, there was the Great Recession – or ‘Lesser Depression’, as Krugman called it in 2011 – which seemed to a few influential economists such as Ben Bernanke, Carmen Rinehart, Ken Rogoff and Barry Eichengreen similar in many ways to other financial crises in the past. But there were other factors too, including the general retreat from globalisation, and the renascence of both nationalist and authoritarian movements around the world, which sounded the death knell for Fukuyama’s benign new world.

As ‘history’ returned, so too has a degree of acceptance of historical approaches among social scientists, who sense, however vaguely, that though history might not repeat itself, it often rhymes, as Mark Twain (might have) put it.

Thinking historically, of course, entails both temporal and contextual dimensions and, in addition, often requires a significant amount of empirical work. Indeed, finding, assembling, analysing and drawing accurate conclusions from the bodies of evidence that historians call data is not for the weak of heart or, more to the point, for those short of time.

So, bottom line: economic forecasters would profit from thinking a bit more about history before gazing into their crystal balls, or at least before telling us what they see. more>