Archives for April 15, 2023

Yes, Socialists Should Support Industrial Policy and a Green New Deal

The capitalist system may be turbulent, inequitable, and antisocial. But there is no “iron law” of capital standing in the way of a program of economic planning for sake of the climate.


A few days ago, Dylan Riley wrote a post on New Left Review’s Sidecar blog that provoked a furious response on left-economics twitter. I largely agree with the criticism made by Alex WilliamsNathan TankusDoug Henwood, and others. But I want to try to clarify the larger stakes in this debate.

Riley’s piece starts from the suggestion that the failure of Silicon Valley Bank reflects a larger crisis of overcapacity and lack of investment opportunities. SVB, he writes,

had parked a huge quantity of its deposits in low-yield — but supposedly safe — government-backed securities and low-interest bonds. . . . The bank was overwhelmed by the massive growth in deposits from its tech clients — and neither it nor they could find anything worthwhile to invest in. . . . The SVB collapse is a beautiful, almost paradigmatic, demonstration of the fundamental structural problem of contemporary capitalism: a hyper-competitive system, clogged with excess capacity and savings, with no obvious outlets to soak them up.

This is an elegant framing, but it runs into a problem immediately, involving the ambiguous meaning of “invest.” The depositors in SVB were not venture capitalists, but the firms that they had stakes in. The reason SVB had such big deposits was not because finance was unable to find profitable outlets even in the tech world, but precisely because it had done so. The fact that SVB’s assets consisted of Treasury bonds rather than loans to its depositors reflects the shift in business financing, especially in tech, away from banks toward specialized venture capital funds — an interesting development, certainly, but one that doesn’t tell us anything about the overall population of businesses looking for financing.

Lurking behind Riley’s formulation here seems to be a crude version of commodity money theory, in which money is either out in the world being useful or being left idle in the bank. But money in the real world is always in the form of bank deposits — that’s what money is — regardless of how actively it is circulating.

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It’s Time for Black Women to #AskForMore

By demanding equal pay for equal work, and by practicing #AskForMore, Black women can take action to begin narrowing centuries-old income and wealth deficits.

Michelle Holder

In an area of study dominated by elite, white men, I am one of a small number of Black female economists in the United States. Black and Women’s History Months in the U.S. present an opportunity to uplift the issues that I am forced to grapple with as a Black woman and that I have chosen to study out of desire for change. Economists often ignore the double gap Black women face when it comes to salaries and wages; this group loses billions of dollars of what I term “involuntarily forfeited” compensation each year due to sexism and racism within the U.S. workplace.

The double gap endures not only due to sexist and racist employment practices, but also because proving this inequity is extremely challenging. While Black women may suspect they’re being underpaid compared to their white and/or male colleagues, it’s extremely difficult for most of us to know for sure, and if we don’t know, we can’t attempt to fix it.

I propose we stop waiting for our leaders to step up and instead flip the script ourselves: In this world of asymmetrical information and lack of national policies around pay transparency, Black women can turn among ourselves and begin to ask for more. I’m not suggesting it’s our problem alone to solve; we didn’t create it. I’m also not suggesting that you stick up your boss, since research shows when Black women assertively negotiate, employers don’t react well. I suggest that, when negotiating, you ask for 10 to 20 percent more than you would have. And keep doing this throughout your career.

I have a personal and professional investment in understanding why so much inequality pervades the economy. In the last few years, I’ve researched the salaries of white men and Black women with similar levels of educational attainment and experience in popular professions, and what I found was sobering.

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Trump’s Real Crime Is Opposing Empire

Christian Parenti

Within 24 hours of former President Donald Trump’s arrest on 34 overhyped felony counts related to hush-money payments made to conceal an extramarital dalliance, his re-election campaign raised $4 million, and he widened his lead in the Republican primaries to almost 30 percentage points. Yet a CNN poll also found that 60 percent of Americans approve of the indictment. These numbers are probably less important than they might appear. The trial will likely mobilize the base in both parties and pull swing voters in both directions—for a net effect of zero.

“The indictment does real harm to the American body politic.”

Even so, the indictment does real harm to the American body politic. It has already set off another Trump-centric media feeding frenzy, at the expense of issues far more serious than the former executive’s half-remembered infidelities, and it creates a dangerous precedent, further politicizing the judiciary and inviting escalation. Above all, it is a reminder that Trump has been investigated, impeached, and indicted not because of the crimes of which he is accused, but because he has dared to oppose the imperial foreign policy favored by elites.

Fans of the indictment insist that no man is above the law, not every case creates a precedent, and other countries indict their leaders. For example, former French President Nicolas Sarkozy was sentenced to jail, and France is still a democracy. But the Trump indictment is of a piece with other developments that should be cause for worry. Just to name one example, a few weeks before the former president’s arrest, Internal Revenue Service agents visited the home of journalist Matt Taibbi while he was testifying at a hearing of the House Select Subcommittee on the Weaponization of the Federal Government.

The IRS’s visit to the home of a prominent critic of the establishment on the same day he was testifying about government overreach is a highly unusual occurrence, and almost seems like the Biden administration flipping the bird to its critics. Outrageously, the mainstream and left media by and large have ignored the IRS bullying of Taibbi. Federal law enforcement has long been deployed in blatantly political ways against the activist left. Heterodox critics like Taibbi are now also targets, and there is ample evidence that it is also being wielded against the MAGA right.

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