Will Wilkinson - Latest Comments in Does the Financial Crisis Discredit “Neoliberalism”?

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Tracy W — Mon, 20 Oct 2008 07:13:39 -0000

I could point out, for instance, that the transition from face-to-face exchanges to impersonal markets comes with a baleful inheritance whose outcomes are often far removed from the idea of “institutions that make human beings willing to treat strangers as honorary friends,” a quote that sounds quaintly utopian.

Well, can you please point out what this baleful inheritance is, and in particular what these outcomes are? Then we can make up our minds whether these outcomes and the baleful inheritance are better or worse than those outcomes and the baleful inheritance of face-to-face exchanges.

Marx, you remember, never sent letters to Kim Jong Il.

Marx and Engel did however, in The Communist Manifesto, advocate, inter-alia:

6. Centralization of the means of communication and transport in the hands of the state.
...
8. Equal obligation of all to work. Establishment of industrial armies, especially for agriculture.

These strike me as ample justification for government control over the labour force - after all armies in Marx's time relied greatly on conscription. And the centralisation of the means of communication in the hand of the state - what a receipe for censorship!

Re: Does the Financial Crisis Discredit “Neoliberalism”?

mari dupont — Tue, 14 Oct 2008 17:52:15 -0000

Re blaming Marx vs. blaming Friedman: Because a free market can exist alongside some very unpleasant political and cultural institutions, proponents of the market are always blamed for these too, even though the Kleins of the world can never prove a causal relationship in a way that that would satisfy even the drunkest social scientist. BUT in a command economy, where everything is allocated by political means (and backed up by force) you really CAN blame the state for all bad things, since they control--or try to control--everything. And whose great idea was this? Karl Marx. And whose name and political philosophy was invoked by every socialist party dictator since the Russian Revolution? Not Milton Friedmans....

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Tue, 14 Oct 2008 10:51:06 -0000

Seen in this light, his approach is much more postmodern than mine.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Tue, 14 Oct 2008 10:38:52 -0000

Actually I was just joking. You couldn't find a bigger fan of Weimar cinema than me (or Fassbinder, for that matter). I was just hoping that you dug Reich. He's a lot of fun.

I know people in France don't talk about these writers--they barely ever did. But my criticism of Wilkinson's approach is that it severs capitalism from a set of historical realities that are embarrassing for free marketers to consider. There's nothing particularly French about my observation. In this article and others posted at this site he presents a caricature of Klein's argument in order to dispense with it more effectively. This would not be allowed in a freshman class on composition, much less be tolerated from a public thinker. Wilkinson seems genuinely baffled by her accusations when, in actuality, Friedman had been dealing with these questions since the time he advised the Pinochet regime. They are not new. What is new is the way Klein assembles her particular narrative.

Now, what I find telling is, whether or not you believe The Shock Doctrine, Wilkinson, in his essay on human nature, dramatically links Marx to the domination of totalitarian regimes (as if Marx had been there to advise them), while the rest of his output manages to inoculate Friedman against any viral attack. One might go so far as to say that the excesses of Klein's narrative are meant to counterbalance this kind of silence. And rather than focus on ethics--essentially the heart of the matter--Wilkinson, in another study, turns the discussion to happiness. In that forty page essay, the word "history" appears a total of three times. In my book, such moves annul "the onslaught of the actual contemporary world."

Re: Does the Financial Crisis Discredit “Neoliberalism”?

webgrrl — Tue, 14 Oct 2008 08:48:53 -0000

How your sarcastic condescension just silences this girl. Not. I suppose by invoking Weimar I'm supposed to be ashamed of some kind of "decadence."

But seriously Harlan, real thought involves more than tying together some Large French Names with their respective dull jargon. That does not intellectual work make.

In France itself, people don't really talk about most of these folks anymore. Po-mo is in fact fading fast, faced with the onslaught of the actual contemporary world.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Tue, 14 Oct 2008 01:31:19 -0000

How very Weimar. Can I assume you like Reich? I mentioned him too, after all.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

webgrrl — Tue, 14 Oct 2008 00:21:42 -0000

O by my high-heeled shoes, Harlan, please spare us the French cant.

Really, back in the day I would have just eviscerated your use of Derrida and Delueze both here with a scathing feminist critique, but now we're all sooo over that.

A better use of time would be just watching Dita von Teese strip. Drop the dead po-mo and consider developing a healthier interest in burlesque.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Mon, 13 Oct 2008 23:29:03 -0000

I agree with you that form represents a complex relationship between a subject and its environment. However, your account of weak and strong impulses is compromised by a lack of critical reflection. My point above was that insights from anyone on the list of writers I cited (Derrida and Deleuze included) might complicate, if not dilute, many of the premises of your basic argument (the section on property rights might become even more interesting seen through the prism of Deleuze and Guattari’s concept of “territorialization”). The anthropological assumptions alone require more rigorous analysis. Again, you work through a great deal of material in a very short space, and the approach is not critical enough. I could point out, for instance, that the transition from face-to-face exchanges to impersonal markets comes with a baleful inheritance whose outcomes are often far removed from the idea of “institutions that make human beings willing to treat strangers as honorary friends,” a quote that sounds quaintly utopian.

I would argue that, even if the emergence of capitalism represents a certain human improbability (though Horkheimer and Adorno’s “Dialectic of Enlightenment” is persuasive in arguing the opposite), your approach to its emergence seeks to free it, not only from negative political consequence, but political consequence entirely. What else explains the urge to sever Milton Friedman from the terror practiced in the Southern Cone? Marx, you remember, never sent letters to Kim Jong Il. Yet, if we compare your reflections on Klein with the text of “Capitalism and Human Nature,” we come away imagining that while communism mainly produced suffering, capitalism has, in its mystical self-showing, mobilized some of our essential (politically neutral) human traits, and has caused no suffering worthy of mention. It’s like history without history.

Let me read through the text on happiness. I’ll respond via email.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

willwilkinson — Mon, 13 Oct 2008 18:53:22 -0000

Hi Harlan, I'm afraid you've misinterpreted much of what I've said.

"These features of human nature—that we are coalitional, hierarchical, and envious zero-sum thinkers—would seem to make liberal capitalism extremely unlikely. And it is."

But it is possible, and so evidently not inconsistent with human nature.

"Once we appreciate the improbability and fragility of our wealth and freedom, it becomes clear just how much respect and gratitude we owe to the belief systems, social institutions, and personal virtues that allowed for the emergence of our "wider civilization"."

If you think I was saying that capitalism is especially natural, you really need to read it again. I think it's pretty unnatural, and requires the cultivation and encouragement of a few weak natural tendencies, and the discouragement of a few strong ones. Do you disagree?

I'd suggest that if you think Derrida or Deleuze are relevant to this debate, you're reading the wrong people. Try Herb Gintis for a man of the left who takes work in recent behavioral science seriously. http://people.umass.edu/gintis/ And check out his Amazon review of the Shock Doctrine, while you're at it. Very unfriendly to free market economics, but also sees that Klein doesn't know what she's talking about. http://www.amazon.com/review/R2NEWPETGH4KPV/ref...

I'd like to see what you think of my paper on happiness. The empirical evidence is very clear that liberal capitalist democracies with high levels of wealth and economic freedom are the ones in which humans tend to flourish best. Do you suppose Klein is aware of this evidence?

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Mon, 13 Oct 2008 17:33:49 -0000

I was amused to see how brittle the spine of this article was, so I spent some time over at the Cato.org site, looking at Wilkinson’s other essays. And I can report that they suffer, too, from the kinds of problems this one does. Their length, however, acts as sort of incubation chamber where errors are free to grow.

A glance at “Capitalism and Human Nature” demonstrates typical moves of the Wilkinsonian mode. In a short article meant to dismiss one hundred fifty years of complex discussion, Wilkinson begins by contrasting a single line from the “Theses on Feuerbach” with a preposterous (and criminally negligent) statement from Kim Jong Il. The purpose? To argue that “Marx's theory of human nature, like Kim Jong Il's theory of pine needle tea, is a biological fantasy, and we have the corpses to prove it.” Wilkinson, by bringing together disparate information in a nearly Surrealist juxtaposition—dramatic but rationally meaningless—seeks to make claims about capitalism’s compatibility with human nature. The only problem is that his areas of focus (theories of hierarchy, evolution, territoriality and exchange) are not without their ambiguities. For each terrain he manages to cross, there are countless counterarguments—coming from figures as diverse as Pierre Clastres, Niklas Luhmann, Marcel Mauss, Jacques Derrida, Heinz von Foerster, Theodor Adorno, Georges Bataille, Gregory Bateson, Gilles Deleuze, Wilhelm Reich, Felix Guattari, Victor Turner, etc. And this is only in the past fifty years. To cite just one example, Pierre Clastres’s studies of the Guayaki Indians in Paraguay demonstrate a political economy quite distinct from capitalist organization, one much closer to a kind of “mystical Marxism,” where accumulations of power are halted in advance via a series of complex social mechanisms (including tribal war), and in which the sharing of game—in a manner that helps cement communal relations—is dictated by an existing taboo. The Guayaki lived out this human experiment for hundreds, if not thousands of years (when Clastres lived with them in the late 1960s, they were much the same as they had been described by Jesuits in the 16th century). It would be pathological to say their way of life was not “natural.”

Wilkinson however does make liberal use of philosophers in the course of his argument, deploying their names mainly as signatures, rather than engaging seriously with their thought. We manage to bounce from Marx to Kant (a backward revolution if there ever was one) on to Denis Dutton, in a series of moves seemingly culled, in their utter banality, from a calendar of daily quotations.

But maybe the most problematic of Wilkinson’s propositions is contained in the section titled, “Mutually Beneficial Exchange is Natural.” This assumes that exchange within the capitalist system is always equal. If that were the case, Marx would never have found it necessary to write one sentence of economic philosophy. (Unequal exchange is a specter haunting much of Western literature and thought—you need only look at the opening of the Iliad, whose narrative begins with this very issue.) But somehow in Wilkinson’s free market fantasy, exchange is both natural and equal.

This short account of the naturalness of capitalist systems, bolstered mainly by a superficial engagement with evolutionary biology (and every other discipline to which Wilkinson turns his hand), runs completely counter to the narrative presented by Naomi Klein, who can produce her own corpses. No wonder Wilkinson takes such issue with it.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Mon, 13 Oct 2008 10:51:43 -0000

I would also point out that this entire article rests on a straw man fallacy; Wilkinson has radically simplified her argument in order to deal with it more successfully. In The Shock Doctrine, Naomi Klein says that crises form an integral part of the Friedmanian system. A financial disaster does not "discredit" neoliberalism; neoliberalism, she argues, functions by breaking down.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Harlan — Sun, 12 Oct 2008 22:38:54 -0000

Even Fukuyama is distancing himself from these economic notions, which tie "political freedom" to the idea of a "free market." Even if Friedman were right about the mechanics of a freely-functioning market (though he wasn't, because information is never totally available within an economic system), no logic, aside from a purely linguistic one (a repetition of the word "free") can unambiguously demonstrate that market freedom and political freedom truly coincide. The connection is largely imagined. And there is, as other comments on this page have pointed out, a very well-documented relationship between Friedman and a series of authoritarian regimes throughout the Southern Cone. One ignores this at one's peril.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

stuart — Sat, 11 Oct 2008 03:43:11 -0000

re. millions vs billions, I just dont see how its relevant to the article, The only examples of social democratic states are states in the millions of people hence the focus on that.

I'm not 100% sure on the banking regulations, but there tends to be a correlation between social democracy and increased regulation on the whole. And its not just the levels of regulation but the impact of the whole system on the wider society. Eg. more equitable incomes may increase poorer households abiltiy to repay loans, it may lead to a smaller subprime market, socialised health costs means that there less costs on households, we need to look at the impacts things like this may have on economic and social outcomes.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

stuart — Sat, 11 Oct 2008 03:36:27 -0000

Icelands been having problems for at least the last year, the last 2 weeks have just pushed it over the edge.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

John V — Fri, 10 Oct 2008 12:50:09 -0000

Muirgeo,

You mock yourself with your answers.

Now once again Friedmanism has brought the economy to it's knees and everyone is a Keyensian again.

This comment shows how uninformed you are. You simply have no way of coherently explaining what this means. Considering how entrenched Keynesianism is in so much of economic policy making, your statement is right off the bat incredibly preposterous. Keynesianism abounds.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Micha Ghertner — Fri, 10 Oct 2008 12:36:02 -0000

"no-one suggested changing the prevailing world order"

I am aware if this. My question is: why not? What makes it just to force millions to share with you while excluding billions from sharing with you? Telling me that's just the way things are isn't responsive to whether things should be that way. Surely poor people living in the undeveloped world would benefit much more from our coerced generosity than poor people living in the developed world.

Is it actually the case that Sweden, Norway, Finland have more regulated financial systems than the U.S. and Iceland? I recall them having higher taxes as a percentage of GDP, but not necessarily more regulations.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Micha Ghertner — Fri, 10 Oct 2008 12:14:21 -0000

Question: Did anyone ever mention Iceland as an example of failed libertarianism/neoliberalism prior to two weeks ago? I know very little about contemporary Iceland, but this citation seems suspicious and all too convenient.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

muirgeo — Fri, 10 Oct 2008 10:28:25 -0000

What a bunch of tripe. The successful post FDR economy was NOT watered down Freidmanism. It is the opponent of Freidmanism, Keyesianism. It rescued the world from the last " Friedman" like debacle the Great Depression. Now once again Friedmanism has brought the economy to it's knees and everyone is a Keyensian again.

Neoliberalism is simply a return to the belief that laissez faire economies are some how better, more efficient or stable when in fact they are not and you should have known thaat by a brief study of past history. That's the main reason for the "Neo" label. How many times are we going to have to repeat this experiment?

Losing your ideology is hard... I know... I used to vote Republican and Libertarian. But I worked my way through it. It's a difficult process but once you break through you feel liberated. You become a Free-thinker again. I think some one could make a lot of money opening up a 12 step reform program for neoliberals. But remember the first step is to admit you have a problem.

You say, " Hi I'm Joe Schmoe and I'm a Neoliberal....

Re: Does the Financial Crisis Discredit “Neoliberalism”?

stuart — Thu, 09 Oct 2008 23:32:56 -0000

'If it did, she would be forced to conclude that even the most watered down version of Mr. Friedmans free market "Utopian" ideas have resulted in greater material well-being, protection of human rights (via capitalism's relationship with democracy) greater personal freedom and individual autonomy than any other attempted economic system'

Personally I would attribute this more to Keynes than Friedman.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

mari dupont — Thu, 09 Oct 2008 22:57:35 -0000

This woman is clearly a fool, yet I have the sinking feeling her books actually sell, otherwise Will wouldnt have devoted a entire blog post to mocking her. While she may call herself a researcher, clearly her research doesnt extend to empirical evidence. If it did, she would be forced to conclude that even the most watered down version of Mr. Friedmans free market "Utopian" ideas have resulted in greater material well-being, protection of human rights (via capitalism's relationship with democracy) greater personal freedom and individual autonomy than any other attempted economic system. But of course, I happen to LIKE these sorts of things, so I guess I'm biased.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

stuart — Thu, 09 Oct 2008 22:12:42 -0000

'Why only millions and not billions? What makes you think it's okay to force some people to share while excluding billions of others from sharing in the system you favor?'

Because policy is the realm of states, and states are generally in the millions of people, no-one suggested changing the prevailing world order.

Successful social democracies lets see, Sweden, Norway, Finland? It depends how you measure success. If you measure it as per capita GDP then maybe, If you equate it to the levels of social mobility then probably.If you measure it on happiness it depends which study you use.

Failed libertarian/ liberal/ whatever you want to call it. USA, Iceland.

But enough semantics, the point is there is a real challenge to the Neoliberal consensus with the failure of deregulated/less regulated financial systems. This article doesnt address that point, rather its just a tirade against some pop-left thinker who doesnt really know what shes talking about. Will, can you please adress the actual issue, how will liberal financial systems survive or change given the current situation? What implications does the financial meltdown have for other areas where markets have replaced government policy?

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Sigivald — Thu, 09 Oct 2008 15:10:00 -0000

Could you define "neoliberalism" for us, muirgeo?

Are you conflating the economic term (aka "liberalism") with the foreign policy term, which has no actual relation to the economics?

The idea that liberal economics (in the classical sense of liberal, not "progressive") somehow is not a basis for competitive markets and always leads to a Great Depression or equivalent is not one that stands automatically without support.

(Free markets with no government-made monopolies (that is, the sort prescribed by liberal economics) are not "competitive"? Really? That's going to be tough, isn't it? Purely from the theoretical level, hasn't that idea had holes below its waterline since before 1950?)

Please to make any sort of argument for your claim. (I'd especially like an explanation of how a liberal economy is one that's not a foundation on which to build democracy. Is this a novel redefinition of the terms?)

(Especially given your example of the US since Reagan, since the US is not exactly an unbridled free market economy and never has been.)

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Micha Ghertner — Thu, 09 Oct 2008 14:01:59 -0000

King George the 3rd I believe asked just that question. The American revolutionaries showed him the answer.

So then you agree that the nonexistence of a system is not an argument against the desirability of that system?

They said we don't like your system of private property that results in ownership by a few and servitude of the many.

So you are saying that the American revolution was a rejection of private property in favor of social democracy? Do you have any evidence to support this peculiar view?

And successful social democracies of the developed world have followed allowing a flourishing of the human condition but indeed with much refinement still needed as the Monarchs are not totally defeated.

Which countries, specifically, are the successful social democracies you admire, and which countries, specifically, are the unsuccessful neoliberal ones you despise?

Libertrainism WAS the state of the world... feudal systems were the obvious end result.

Which countries, specifically, would you describe as being libertarian, historically?

Social democracies do exist successfully all over the world and they maximize liberty as much as can be exppected when sharing among millions.

Why only millions and not billions? What makes you think it's okay to force some people to share while excluding billions of others from sharing in the system you favor?

Re: Does the Financial Crisis Discredit “Neoliberalism”?

muirgeo — Thu, 09 Oct 2008 12:53:52 -0000

"And most importantly, what would you say to a monarchist who asked, two to three hundred years ago, where democracy exists (successfully or not) in the world? Would you consider this a decisive argument against democracy?"
Micha

King George the 3rd I believe asked just that question. The American revolutionaries showed him the answer. They said we don't like your system of private property that results in ownership by a few and servitude of the many. And successful social democracies of the developed world have followed allowing a flourishing of the human condition but indeed with much refinement still needed as the Monarchs are not totally defeated.

Libertrainism WAS the state of the world... feudal systems were the obvious end result. it's an old refuted concept of stagnation and despair. And of little liberty. Social democracies do exist successfully all over the world and they maximize liberty as much as can be exppected when sharing among millions.

Re: Does the Financial Crisis Discredit “Neoliberalism”?

Herman G. — Thu, 09 Oct 2008 12:31:44 -0000

You neglect the very real role that the University of Chicago economics department played in the training of more than twenty economists who would later take on various positions in the Chilean government in the 1970s and 80s. This history--the creation of the so-called "Chicago Boys"—has been well documented. You're certainly welcome to challenge the extent of Friedman's _direct_ influence on the Chilean economy--but the idea that there _is_ a causal line running from Friedman to economic policymaking in Chile seems indisputable, in a way that goes far beyond an analogy with Chavez's interest in Chomsky.