Profit Margins, the WSJ Editorial Page, and Marxism
I saw two interesting posts this morning, one by Matthew Yglesias on Slate, talking about how the past four years have him feeling more Marxist, and the other from the bonddad blog, about how the stock market is not divorced from reality, and that high stock prices and all-time-high profits reflect reality — a reality in which wages are being squeezed. Also of note is Tom Friedman’s recent op-ed on the “401k World,” which Yglesias mentions, which is a very deterministic piece about how technology, etc., has made us much more individualistic and responsible for ourselves.
It does not take a genius to see the connections here. But first let me explain my own views, as I have here in the past and also in blog comments on others’ sites over the years. I have no ideological dog in any fight. Taxes are neither inherently bad nor good. Regulation is neither inherently bad nor good. I respect the idea that when we take from the rich in redistribution schemes we create inefficiency, waste, and bad incentives. I respect the idea that we must help the poor, and that the the private sector and religious organizations are not capable of shouldering that burden alone. I am a creature of circumstance. The questions I care about are: is this regulation worth the cost? What is a level of redistribution we must maintain in order to maintain social stability?
The WSJ Editorial page is not interested in such questions. It is ideological. Cutting taxes is always good. Reducing regulations is always good. The poor deserve it. The rich deserve their wealth. Extremely simple. Marxism is also very simplistic. Sharing is good. Equality is good. The wealthy are evil.
My response to the WSJ Editorial page, and to the high profit margins and lowered wages of which bonddad speaks, is different from Matthew’s. My response is to note his response as a shift in the cycle of ideology.
To explain that. In my view, based on my comments above, there is a utilitarian or pragmatic rationale for helping the poor, which has an historical basis. As far as I can tell, pretty much all Marxist/Communist and otherwise populist revolutions of which I am aware started when inequality was sky high, and when the rich did not give a hoot about the poor, and either blamed them for their problems or expected them to grit their teeth and bear it. The most famous expression of this is of course, “Let them eat cake.” But it’s not just France. Lenin arose in response to a deeply unequal and cruel Czarist system. Cuba before Fidel Castro was, famously, a society of haves and have-nots. Venezuela before Chavez, the same.
People with the WSJ Editorial viewpoint either do not understand this, or they do not care. They want to push the envelope as far as possible in their ideological direction, they want to maximize their present happiness, wealth, and efficiency. To the extent they worry about any of this, they think things will “work out.”
And they are right! That is where Yglesias comes in. The response when the WSJ ideas get too powerful is contained in our wonderfully non-rigid Democratic system: when life gets too bad, people start switching sides. People who didn’t previously care become desperate and start caring. I stand above and watch with interest, and to me, Yglesias is a sign. Yglesias thinks one view is more correct now. That is not true. The evils of Marxism are the same as they always were. But the evils of unfettered capitalism remain the the same as they always were, and they presently have the upper hand to some extent. The difference between this country and Czarist Russia, in other words, is in our flexible political system, in which all have a voice.
This is not the first time this has happened. The Right bemoans FDR and has been engaged for the last ten years in re-writing the history of the Great Depression. But they can’t write Eugene Debs out of the early Twentieth Century. They can’t write the Communist Party in America out. The reality is, this “bridge too far” in one direction has already happened at least once in this country, from about 1910-1934. FDR was not a radical. He was a popularly elected conduit by which enough of the evils of socialism (it is called “social” security for a reason, people) were mixed into our capitalist system that we did not elect Eugene Debs President or annex ourselves to the Soviet Union.
Can it happen again? I happen to think it already is. ”Obamacare” itself is part of a push back against policies dating back to the Eighties. Yglesias signals that shift has not ended. Occupy Wall Street. Elizabeth Warren. Daily Kos. The re-creation of MSNBC in response to Foxnews.
One can have three possible responses to all of this. First, one can be or remain ideological like the WSJ Editorial page is, and continue to fight for ever less redistribution and regulation, no matter the circumstances. Alternatively, one can go in the other direction, as Occupy Wall Street did, and as Yglesias signals is his inclination, and fight basically for pure socialism. Or, third, one can view this all as a cycle of the ascendance and fall of Leftist and Rightist ideas, a cycle that we have the luxury of having because the founders designed a system flexible enough to protect both the WSJ Editorial page and the Marxists from their own inflexibility, certainty, and short-sightedness.
You know where I fall. They sadly did not design our system well enough that people like me could just keep us on a relatively moderate path at all times. So we must content ourselves with these cycles.
Folks, there is virtually no such thing as a bad idea. All horrid things in this world represent good ideas taken to their extremes. This happens because people have a very hard time with uncertainty. They therefore do not realize that somewhere on the slippery slope is the best place to be. It is a fact I hope more will keep in mind as others continue in their respective ideological arms races.