In a post financial crisis book, one dedicated to explaining
what caused the resulting recession, William K. Tabb makes an interesting
observation. His use of the concept, social
structure of accumulation (SSA), places the importance of a prevailing mental
construct at the center of determining how an economy functions:
The social structure accumulation
(SSA) framework suggests that periods of growth require a coherent set of
mutually reinforcing institutions favorable to capable accumulation. These involve the creation of relatively
lasting accommodations between contesting social forces, including stable
understandings between capital and labor, the United States and the rest of the
world, capital and the state, capitalists and other capitalists, and citizens
and their government. Institutional
stability provides conditions under which the behavior of others, the meaning
of events, and the likely outcome of actions can be predicted over the relevant
planning horizon with enough confidence to provide consistent expectations, and
so encourage investment and promote growth.[1]
In short, economic actors, according to Tabb, need to be
sufficiently on the same page in both thought and action. This can be viewed as reflecting a sufficiently
unified mental economic image among these actors. Short of that, economies suffer from drift
and progress is stymied.
There has been a series of SSAs throughout the history of the
US. Tabb’s analysis is focused on what
he terms the neoliberal SSA. It is based
on a general acceptance of a libertarian view of government’s legitimate role as
being highly limited in the economy.
Historically, it replaced the Keynesian SSA that dominated our economic
views from the 1930s through World War II and into the 1960s. That view legitimized a very strong role for
government and led to such policies as Social Security, Federal Deposit
Insurance Corporation, and a whole array of regulatory agencies to oversee the
economy. As the 1970s came and went with
their inflation and malaise associated with the post-Watergate years and the
administration of Jimmy Carter, that SSA fell into disfavor. Then there was the articulation of Ronald
Reagan along with his presidency. Through
the thrust of his policies, we have had the neoliberal view guiding our
economic activities up until the financial debacle of 2008. That span of years saw a high degree of
deregulation. Whether the Great
Recession has been enough to dislodge it, is still an open question, but I
think the upsurge of both Donald Trump and Bernie Sanders reflects a higher
sense of anger and anxiety among the American people – our collective
discontent. Those are the very emotions
that lead to a change in beliefs and actions.
This duo of Trump and Sanders is interesting because each
would pull our economic sensibilities in two opposite directions. Trump would go further down the neoliberal
direction while Sanders would push us toward policy with a strong governmental role
in our economy. Tabb describes that when
an SSA falls into disfavor, there is a period of indecision and the economy at best
just moves along aimlessly. This seems
to describe the economy since the outbreak of our economic woes in 2008. But before we pass judgment on the demise of
the neoliberal SSA, we should have a better understanding of how it eased the
way to our current dysfunctional state.
To my mind, the neoliberal SSA is a natural outgrowth of the
dominance of the natural rights construct which I have argued in this blog has
guided our general views of governance and politics. Its growth and strength predated the rise of
the neoliberal view but served to pave the way for such economic thinking. The overall effect has been to create the following
economic conditions:
·
Large
levels of deregulation led to financial strategies heavily dependent on
leveraged schemes
·
Such
schemes offered large profits to those who, like hedge fund managers, participated
·
Due
to these and other restructuring flows of capital toward either financial
activities or investments in foreign production facilities, there has been a
significant shift of income and wealth to the upper classes, particularly
toward the top 1%
·
Today,
the lower classes are worse off than they were at the beginning of the twenty-first
century
·
This,
in turn, has put many lower class members into very precarious conditions
particularly in terms of financial insecurity and a lack of sufficient health care
·
The
number of people in the middle class has significantly diminished (and not
toward the upper classes)
·
The
designation of America as the land of opportunity has come seriously into
question
·
And
all of this is heightened in the US because, of all the advanced nations, our
nation is the least disposed to help or assist in addressing the harshness that
exists among those in the lower classes.[2]
Needless to say, especially to those who read this blog
regularly, my wish is that the natural rights construct comes under question
and loses its dominance over our political thinking toward what I prefer, a
liberated federalist view. I believe if
that would happen, we would drift toward a newer SSA. Further, that newer SSA would, in economic
terms, lead to collaborations both nationally and globally in which all
stakeholders would be respected and their interests would mutually advance in reasonable
ways. This newer view would not pit all
against all, but would, while respecting individuals and their initiatives,
seek common interests. We hear among
industrial leaders a language shift indicating such a change. Whether this is merely public relations marketing
at work or a more substantive mental posture, the upcoming years will tell. Here’s hoping it is substantive.
No comments:
Post a Comment