There is so much going on in the global political economy at the moment, for good or ill, providing potential for blogging, that it is sometimes difficult to know what to focus on. War, climate change, inflation, growth and stagnation, technological evolution, and so on. I always find that I need to be doing some serious reading in order to be inspired to post, whether that is my regular ‘quote of the week’ or a longer discussion or review. My reading has shifted somewhat in the last couple of months, towards ‘green’, ecological and environmental economics. While I have posted on these issues before, they have tended to be only a momentary focus.
Back in 2010, I took a standalone module in Sustainable Development via distance learning. It really opened my eyes to a field which includes economics, but incorporates ideas from many other subjects, such as politics and ecology. While definitions of SD can be vague, advancing its study surely remains important to the future progress of humanity.
A return to sustainability
Followers of this blog will probably agree that I have neglected SD and environmental issues, in favour of heterodox, progressive economics and political economy, much of which tends to favour policymaking which encourages economic growth and reduces inequality. Ecological economics can be much more sceptical of the growth imperative under capitalism, with some practitioners calling for a steady-state, zero growth economy, or even degrowth, in order to reverse unsustainable rates of resource use and restore the natural environment.
Steve Keen, a fervent long time critic of mainstream economics, has in recent years begun to draw on ideas from ecological and biophysical economics, alongside his work on post-Keynesian and complexity modelling of the economy, and has turned his fire on neoclassical environmental economics, not least in his book The New Economics. He argues that the modelling of climate change by the latter school results in what could prove to be catastrophic complacency when it comes to the future of human life on earth.
Keen remains something of a maverick economist, in the best sense of the term, and his new work has (re)stimulated my interest in ecological economics and SD. In particular, the issue of the sustainability or otherwise of economic growth seems like one of the major issues of our time. If it is not sustainable then much of the basis of modern economic policy is dangerously flawed. If it is sustainable, at least in some form, then we need to be clear on what that form takes if we are to encourage the generation of widely-shared prosperity across all levels of humanity. Growth: A Reckoning by Daniel Susskind has only just been published, so I have not read it yet, but a quick browse indicates that the author argues in favour of continued economic growth, following arguments which define it in some sort of sustainable form.
Robin Hahnel, a leftist political economist and socialist, has written a number of books on the construction of what he sees as a more ‘democratic’ economy beyond capitalism with a limited role for markets, as well as on environmental economics. While I am sceptical that a highly complex economy can do without a significant role for markets, there is plenty in his work that is worth exploring. His Green Economics is something of a heterodox textbook for the student or intelligent layperson, which combines concern for planetary ecology and economic justice, with a critique of mainstream environmental economics and radical policy proposals. Income distribution and Environmental Sustainability adopts a more technical approach, drawing on the work of Piero Sraffa. Sraffa was a colleague and friend of John Maynard Keynes at Cambridge University, whose relatively small amount of published work belies a continued influence on leftist economics. Hahnel has also written the short and more accessible Radical Political Economy: Sraffa versus Marx, whose title speaks for itself.
My reading list when it comes to ecological economics also includes Steady-State Economics by Herman Daley and The Second Law of Economics: Energy, Entropy and the Origins of Wealth by Reiner Kümmel.
A return to SD has also led me to consider ideas about the relationship between nature, society and the economy. SD and ecological economics give rise to debates about these three ways of looking at human activity on the Earth. Some arguments see the economy as emergent from but dependant upon society, with society in turn emergent from and dependant upon nature. But causation runs in both directions between these three, with economic activity changing society and nature for example, sometimes sustainably, and sometimes not. More holistic viewpoints might see the three as inseparable, making analysis and effective policymaking more difficult.
Impossible analysis?
This leads me onto another related area of current interest, which draws on the ‘post-modern’ Marxism of Stephen Resnick and Richard Wolff. The latter has written some ‘popular’ books alongside his academic work, and due to his frequent appearance in the media, The New York Times magazine once named him “America’s most prominent Marxist economist”. Resnick and Wolff’s vision of humanity sees it as living in an ‘overdetermined’ natural-social totality. In simple terms, this means that everything in society is seen as influencing everything else and that all truths are relative and partial. They reject the economic determinism of classical Marxism, which holds economic forces as being the prime motor of social change. Their ‘Rethinking Marxism’ approach sees economic, political, cultural and natural processes all influencing each other in complex ways. All this would seem to make analysis impossible. They claim that one of their goals is a political one, that of establishing a society beyond capitalism free of class exploitation, and they freely admit that their work is meant in part to serve this aim.
While I once again express my scepticism regarding their communist project, I do have sympathies with their philosophy of overdetermination. I think many economists, including myself, can be guilty of economic determinism in their analysis, leading to an arrogance as to the power of the subject to illuminate and change society in a particular direction, ostensibly for the better. Opening the mind to the political, cultural and natural, for example, and seeing them as all potentially impacting on one another as well as the economic, with none as dominant, might make for a humbler economist, even if the resulting analysis is more difficult and uncertain in practice.
Time to remake Britain
Another new book, more for concerned voters in Britain, which at the moment may cover a lot of the country, is Will Hutton’s This Time No Mistakes: How to Remake Britain. Hutton rose to fame in the mid-90s with his bestselling The State We’re In, which offered a scathing critique of Thatcherism and the case for a new kind of social democratic society: stakeholder capitalism. His new book comes, nearly thirty years on, at a time when the British Labour Party are once more well ahead of the Conservatives in the opinion polls with an election on the horizon. While obviously somewhat richer than it was then, many aspects of the economy and society are not in great shape. Hutton gives you the full argument and remains an unrepentant anti-Thatcherite, the reasons for which can seem clearer today. He makes a strong case for political reform to drive social and economic change for the long term, which Tony Blair’s ‘New Labour’ in many ways did not do when in power from 1997. His basic philosophical and political idea is that there needs to be a marriage of the ‘we’ of ethical socialism and the ‘I’ of liberalism, or a rebalancing of the relationship between the collective and the individual under capitalism in order to attain much greater and more widely shared prosperity.
Freedom for progressives
Finally, Nobel Prize winner Joseph Stiglitz also has a new book out, The Road to Freedom, which I am looking forward to reading. Stiglitz is a pretty mainstream economist, with his work building on neoclassical orthodoxy, but he is of the progressive left in terms of policy proposals, wanting a reformed capitalism rather than its overthrow. Even though I prefer heterodox and sometimes radical approaches to economics, when it comes to policy practice, I often find myself supporting Stiglitz. In my view, there are too many divisions on the left, arising from a desire for ideological purity, and this has tended to limit their scope for achieving meaningful political change when in power, when indeed they mange to attain it! The book promises a re-evaluation of the idea of freedom under capitalism, aiming to recapture the terms of debate from the narrow vision of the neoliberalism of recent decades.
That’s plenty to be getting on with in the coming weeks, and I hope to be sufficiently inspired to post on some of it.
The Political Economy of Development 