Archive for March, 2011|Monthly archive page

Austerity is no Surprise

This extract comes from The Confiscation of Economic Prosperity.  It serves as a reminder that this crazy demand for austerity should not come as a surprise.

Besides, the problem is not the size of the deficit but the policy changes that the right wing can engineer by stoking fears about the disaster that deficits can create.  The idea is that with the government facing seemingly unmanageable deficits, the public will be stampeded into a wholesale slashing of government spending. Continue reading

New Interview with Michael Perelman

I had a nice interview at the Left Forum with a representative of very interesting platform.  I was mostly covering material from The Invisible Handcuffs.  Even if you are not hearing me, you might want to check out the entire site.

9-11, nuclear explosions, political change

I am New York for the Left Forum, sitting in a hotel room just across the street from the World Trade Center site.  The juxtaposition of my location in the recent energy disasters in the West Virginia coal mine, the San Bruno gas line explosion, and the horrendous situation in Japan got me to thinking.


I recorded some of my thoughts on YouTube until a computer malfunction brought it to a halt. I intended to include the BP oil disaster and Hurricane Katrina. You can watch what survived at:

Interview with Michael Perelman

Suzi Weissman interviewed me about The Invisible Handcuffs for the last 20 minutes of her show.  The earlier guests are top notch.

Frontiers of Price Indexing or Product Placement?

“Let them eat iPad.” That was the cry Friday after William Dudley, head of the Federal Reserve Bank of New York, acknowledged to an audience in Queens, N.Y., that food prices had gone up before adding that some prices are lower. “Today you can buy an iPad 2 that costs the same as an iPad 1 that’s twice as powerful.”

Barley, Richard. 2011. “Comedy Fit.” Wall Street Journal (12-13 March): p. B 18

The Attack on Unions in Selig Perlman’s Wisconsin

The Wisconsin attack on unions is sadly ironic, given the progressive tradition of the state.  One of the progressives who whom I have not seen mentioned was Selig Perlman (1888-1959).  He was an important economist at the University of Wisconsin and teacher of the son of Robert La Follette, who was, like his father a governor of the state.  Later, I had the privilege of knowing his son Mark, I wonderful man with an amazing breadth of economic knowledge and experience.  Putting information together from Mark and my father, our families came from nearby each other.  I always addressed him as Cousin Mark.

In an undergraduate class, we read Perlman’s book, A Theory of the Labor Movement.  I remember my teachers’ explanation of the book more than the book itself, which I have not read in the last 50 years.  Perlman was a former Marxist, who saw the unions as a bulwark against communism. I don’t know whether he influenced later scholars’ ideas that, by giving workers a voice, unions dampened their revolutionary spirit.  I suspect that his analysis had some influence on Jay Lovestone’s CIA-sponsored project to encourage (capitalist-friendly) trade unionism around the world.

Obviously, Perlman was not radical, but he still was sympathetic to the working class. Now that the Soviet Union is gone, unions no longer serve such a purpose. Instead, they are treated as a parasitic force that eats into the profit rate.  Hopefully, this nonsense will cause a strong enough reaction to ensure that nothing like this happens again.

Michael Perelman at the Left Forum

I will be on a panel: The Struggle Against Mainstream Economic Ideology

H. Panel Session 4-Saturday 5:00 p.m. – 6:50 p.m

Michael Meeropol

Doug Henwood

Howard Sherman


Michael Meeropol


Michael Perelman

37 E321

I would enjoy meeting some of you whom I know only via the Internet


Compassionate Capitalism

One must admire the extent of compassion expressed by the captains of capitalism. Some people unfairly snickered when George Bush declared himself a compassionate conservative, but he is a passionate advocate of business and his description may have been accurate.

Despite all the talk about greed being the fuel that drives capitalism, profits are virtually irrelevant.  As an act of philanthropy, corporations scatter much of their profits in less developed areas, such as the Grand Cayman Islands and Bermuda.

As further evidence, I read today that the Bank of America is reluctant to lower the value of its own loans out of compassion for the people who stayed up-to-date with their payments. After all, one of the motives for subprime loans was to meet the desires for people who wanted enjoy homeownership.

Similarly, business opposes minimum wages out of compassion for workers who might lose their jobs. For the same reason, business reluctantly accepts tax breaks only because it allows them to help unfortunate workers who might find themselves without a boss. The same motives explain why business fights so heroically against regulation.

Cutting welfare or publicly provided health care does a service to the poor almost certainly as a university education. Finding themselves without a social safety net, people receive an education, allowing them to navigate the complexities of the marketplace, assuming that they survive the experience. Should such people meet their maker, their demise will represent a charitable gift to the poor-oppressed taxpayers, who already shoulder excessive burdens.

Taxpayers, in fact, are the most admired agents in capitalism.  If corporate leaders were more egotistical, they would be paying more taxes.  As an act of modesty, they refrain from showing off in that way, allowing others to win the glory of paying taxes.