Tag Archives: review

The English intelligentsia – a contradiction in terms

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One of the interesting aspects of Tony Judt’s [amazon_link id=”009956355X” target=”_blank” ]Thinking the 20th Century[/amazon_link] (which I’ve nearly finished) is the insider-outsider perspective he has on England. He grew up in London, the son of an immigrant father and second generation immigrant mother, and emigrated to the US in his late 20s. So he has a nice combination of familiarity and objectivity about his birthplace (and I mean England, not the UK, as he has a very London-centric view).

Given that I spent my teenage years in a small Lancashire mill town pining to be a philosopher sitting in a French cafe, I was particularly taken with Judt’s comments about the way the English dismiss intellectuals – ‘English intellegentsia’ is not a meaningful social concept. His hypothesis is “that the intellectual agenda which drove ideologically configured political movements in continental Europe was quite absent in London.” This lack of ideology was a blessing for most of the 20th century. As Judt points out, the penalty Eric Hobsbawm paid for being a lifelong Communist was no more serious than having to be a professor at the University of London rather than Cambridge. That tolerance would surely not have played out in the same way on the Continent.

There is also a nice passage describing the way the furthest reaches of Empire – George Orwell’s Burma, India, the Caribbean – seem comfortable and familiar to the English thanks to language and cultural references, whereas the Continent seems wildly exotic. Even for Shakespeare the “coast of Bohemia” was a mysterious distant land, and as for Slovenia or Bulgaria, or even the longingly imagined Paris of my adolescence….

[amazon_image id=”009956355X” link=”true” target=”_blank” size=”medium” ]Thinking the Twentieth Century[/amazon_image]

[amazon_image id=”0140004564″ link=”true” target=”_blank” size=”medium” ]Burmese Days[/amazon_image]

Fear and loathing

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[amazon_link id=”1844678644″ target=”_blank” ]Chavs: The Demonization of the Working Class[/amazon_link] by Owen Jones deserves the praise it has earned from other reviewers. It paints a picture of class division in modern Britain that is over-simplified in some ways, but captures an important truth. The big truth is that the worlds of the social classes have separated, and the middle classes and elites have grown more contemptuous – because fearful – of working class people the less contact they have with them.

In my own comfortable suburban milieu this takes the form of supposedly left-wing friends who nevertheless send their children to private schools. London’s state schools add more value than any other schools in the country so the ‘rationale’ for this choice in terms of not wanting to sacrifice one’s children’s education for the sake of one’s own principles is threadbare. I believe the reason is the fear of social contact with other classes. (My children have attended our local comprehensive.)

Jones pins the start of the demonisation of the working class as ‘chavs’ to the economic and political ideology of the Thatcher government. Housing policy seems key. The right-to-buy for council housing was taken up by those families with a bit more money, leaving the poorest in a shrinking stock of council accommodation, which was increasingly earmarked for the most troubled families and isolated from other parts of society. The knot of related problems we are so familiar with consequently developed in these estates – the unemployment, ill-health, low-quality housing, poor schooling, drug abuse, crime. (Lynsey Hanley’s [amazon_link id=”1847087027″ target=”_blank” ]Estates[/amazon_link] is brilliant on this issue.) Jones is equally scathing about New Labour, for acceding to the Thatcher revolution, and its depiction of the working class as something to escape from rather than a cohesive class to be proud of and raise collectively.

He also opened my eyes to just how disdainful and disrespectful is so much comment and language about the working classes. Clearly, I lead a sheltered life by never reading tabloid newspapers. The book is definitely onto something, too, in noting that the politics of race are sometimes deployed to disguise the politics of class – the white working classes can be portrayed as simply anti-immigrant and racist, another reason (for the commentariat of the left) for being disdainful about them.

However, there are some aspects of Jones’s pre-Thatcher perspective that lead him to underplay some of the complexities of class politics in modern Britain. For example, he argues that commentators malign the British working classes as work-shy couch potatoes who just want to claim benefits by comparing them with hard-working immigrants who, far from ‘stealing’ jobs, are doing them because the natives are too idle to bother. Until recently I was a member of the Migration Advisory Committee and spoke to many employers during my five year term about their reasons for preferring immigrant labour; it is a fact that large numbers of young native-born people have never been taught the basics of the workplace – punctuality, politeness, putting in some effort – and are essentially unemployable. This is not to say it is their individual fault. But to trace the reasons, schools are facing a social catastrophe with a portion of their intake. I have heard London teachers talk of the widespread low-level neglect of children who turn up at primary school lacking minimal social and language skills, unwashed, fed on crisps – all of which makes discussion of which kings’ reigns to cover in the national curriculum a bit, well, academic.

It is hard to know where to start addressing these multiple challenges, although clearly housing and education lie at the centre of the complex of problems. Chavs gives the impression of wanting to turn the clock back to the pre-Thatcher era of union power, which wouldn’t be my choice. Still, the book does a great service in calling out the unacceptable demonisation that has accompanied the growth of inequality and the withdrawal of the powerful elites and middle classes from their own society.

[amazon_image id=”1844678644″ link=”true” target=”_blank” size=”medium” ]Chavs: The Demonization of the Working Class[/amazon_image]

City in a box

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A manual for building cities? A guest review by Philip Thornton

The role of cities in local, national and supranational areas is becoming a key focus for economists. More than half of the human population now lives in an urban rather than rural environment, as the  UN has repeatedly warned although some (pdf) quibble with the definitions.

As a result there is a greater focus by economists on both what the impacts of this shift are and will be, and also on how one should think about ways of ensuring that this process of urbanisation bring greater human well-being rather than simply larger slums and greater potential for worse epidemics or civil conflicts. Perhaps the best –known example in this direction is Paul Romer’s proposal for “charter cities”.

Now a new book has drawn together essays by, or interviews with around 30 planners, architects, politicians, urban designers and city managers. Well not so much a book as a magazine, but at 140 A4 pages its word count would match the length of a similar book on the issue.

It is issue number 34 of a magazine/book called Volume, published by ARCHIS, a Netherlands based publisher and the C-Lab at Columbia University in New York, and is called City in a Box. ([amazon_link id=”9077966331″ target=”_blank” ]Back issues of Volume[/amazon_link] can be found on Amazon.)

City in a Box

In its editorial it makes clear that its focus is on the entities that are taking the initiative, making the decisions and establishing the governance of the new towns that are needed to meet the demand from a rising and increasing city-seeking population.

As editor-in-chief Arjen Ossterman says: “The general tendency is that companies instead of governments and their planning departments are starting to create and run cities – the full package or ‘city in a box’.” This will certainly ring bells in the UK which may not be building new towns but is looking at the private sector to design, fund and own the infrastructure needed to keep our existing, creaking cities going.

The book is thick with detail and plans and covers new cities across the world – and especially the emerging world. A fascinating map shows there are precisely four new towns  built or proposed since 1990 in Europe – including Strand East in the former London Olympic Park. There are 600 in China and India alone.

Michelle Provoost, director of the New Towns Institute, points out that in establishing new towns, emerging economies are only coping what the UK in particular did after World War II to build “neighbourhood units as structural principle” such as Milton Keynes and Welwyn Garden City. But she points out than the driver this time is not post-war desolation but a desire by the enriched middle and upper class households for new high quality living. The new “new town” is very much a commercial product.

The interviews and articles are interspersed with “tips for building a new town”, which include advice such as replicating your product and designing the post card image. Confusing the tips also include the possibly contradictory messages to “find multiple ways to profit” and “find justification other than profit”.

But perhaps the most interesting section for economists is the one of governing the city as it raises  issues of ownership, division of responsibilities and public goods. Scot Wighton, city manager of Lavasa Corporation that is building a private, planned city in Pune, India, points out that Lavasa is not yet a town under Indian law. This means that while he has responsibility for water, sewage, power, has transport, parks and many more things, he is accountable to the corporation president. As a result there is no power to tax or establish a public health authority. He acknowledges that it is not possible to have half a million people living under the rule of a company for ever and that transition to state ownership will come.

But in the meantime he highlights a real concern among investors over the security of their assets. The only way to make this assurance is through devolution of some authority, he says. “So how can we do that and still fit into the context of an Indian democracy? I think we have a way to do it but…until it happens we have this quasi-public-quasi-private city.”

A chart showing the structure of ownership and control of new towns such as Strand East shows that the London Borough of Newham is just an investor while the developer is a private company, LandProp Holdings BV. Welcome to a brave new world.

Overall it is primarily a publication for architects and urban designers and, at €19.50 an edition, carries a hefty price tag. But considering the growing importance of the study of economics geography and spatial economics in the UK many of the growing number of students, teachers and practitioners in this field may feel it worthwhile.

One small quibble is that the page numbers are right next the middle centrefold so makes it hard to flick through to the page you are seeking.

Phil Thornton is lead consultant at Clarity Economics. www.clarityeconomics.com

 

All-powerful economists?

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There are really two separate books rubbing shoulders in [amazon_link id=”0857284592″ target=”_blank” ]Economists and the Powerful: Convenient Theories, Distorted Facts, Ample Rewards[/amazon_link] by Norbert Häring and Niall Douglas.

One of them is a clear and well-made case that modern economics has been in error in ignoring the part played by institutions, politics and power relations in actual economies. It has chapters covering the acquisition and abuse of power by the financial services industry, the distortion of business in the interests of executives rather than customers, employees or shareholders, and the increasing concentration of the US economy through merger waves. Although many or most professional economists who work in business or regulators or consultancy have always been well aware of institutional detail, I think it is fair comment that academic economics overlooked the reality of markets and economies for too long. I’d also add that this has been changing quickly, with the rise over 20 years of institutional economics, behavioural economics etc (see [amazon_link id=”0691143161″ target=”_blank” ]The Soulful Science[/amazon_link]) – but there is further to go.

The second book within this set of covers is more tendentious. It is a history of economic methodology in the first chapter (I must say, I’d have put this at the end if I’d been the author). While the authors land some punches, and make some good points about the way theory shapes reality (see my Tanner Lectures on this question of performativity), they are too conspiracy theorist about it. The original spin-meister Edward Bernays is wheeled out, along with the Inside Job accusations that the financial crisis came about because some economists were paid to write a report by the Icelandic government. Although many economists in universities do paid consulting work – and should certainly declare it when they publish their work – I don’t believe there is signficant distortion of what gets published as there seems to be in the case of pharma companies and medical research. The economists simply have a much wider choice of options, and are not beholden to one set of powerful business interests. There would be something interesting to say, nevertheless, about the narrowing of economic research as published in mainstream journals – I just don’t believe it’s as crudely marxist as suggested here. Similarly, the way economic theory and practice developed from the 1940s to 1980s was certainly bound up with the wider ideological/political climate (like any social science discipline is sure to be), but not in such a purposive way. I think the messy sociological reality of the profession would be far more interesting to understand than the ideological, top-down assertions presented in this book.

Still, it’s an interesting read. The argument that marginalism, the refusal to compare individuals’ utility and rational choice added up to the inevitable demotion of interest in economic institutions is quite interesting. Besides, I’m all in favour of economists continuing to introspect for at least as long as the world economy remains in such a fragile state.

[amazon_image id=”0857284592″ link=”true” target=”_blank” size=”medium” ]Economists and the Powerful: Convenient Theories, Distorted Facts, Ample Rewards (The Anthem Other Canon Series)[/amazon_image]

Gross Domestic Problem

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Here’s a book title that wears its heart on its cover. Lorenzo Fioramonti’s[amazon_link id=”1780322739″ target=”_blank” ] Gross Domestic Problem: the politics behind the world’s most powerful number[/amazon_link] gives you the essence of the argument upfront. If I had to sum it up as an elevator pitch, it would be Tim Jackson’s [amazon_link id=”1849713235″ target=”_blank” ]Prosperity Without Growth[/amazon_link] view (that economic growth is environmentally unaffordable and unnecessary for welfare) meets the left-wing belief that the military-industrial complex is in control of the economy for its own purposes. I don’t agree with either, although my disagreement is sympathetic.

[amazon_image id=”1780322739″ link=”true” target=”_blank” size=”medium” ]Gross Domestic Problem: The Politics Behind the World’s Most Powerful Number (Economic Controversies)[/amazon_image]

Start with growth and the environmental costs. It is surely obvious to all but a small minority that measuring better the impact of economic activity on the environment is vital. My preference is to monitor the depletion of natural assets of all kinds, a balance sheet approach automatically injecting the longer-term perspective necessary for sustainability – there is much on this in [amazon_link id=”0691145180″ target=”_blank” ]The Economics of Enough[/amazon_link]. But any kind of environmental dashboard would be welcome. What drives me to distraction is the persistent belief that we should just stop economic growth because it’s not making us happy. This is simply incorrect – this book cites no research on the question later than 1997. Subsequent research has clearly established a strong link between GDP per capita growth and measured ‘happiness’ – see for example this recent paper on happiness and GDP, and the references in it. Besides, just think – no growth means no innovation, no redistribution (it has never happened outside a rapidly growing economy), rising unemployment (unless companies are banned from improving their productivity ever). The misguided belief that growth won’t make people happier is dangerous because it will prevent any practical politics of sustainability.

On the book’s political arguments, it’s obvious post-crisis that conventional, mainstream economics has been wrong to ignore the politics of finance and the lobbying power of the banking industry. Brett Christophers’ new book, [amazon_link id=”1444338285″ target=”_blank” ]Banking Across Borders[/amazon_link], is a fascinating historical account of how that power developed – including its use of the mantra of GDP – in the post-war era. By contrast, Gross Domestic Problem offers some assertions: “GDP served the interests of political and economic elites for several decades”  – OK; “European member states came to accept that only if GDP went up could they afford to pay for schools, hospitals and social security” – er, the Stability and Growth Pact to which this refers aimed to cap government deficits, but raising taxes to pay for public services was never ruled out, certainly not by reference to GDP; “Between 1948 and 1989 American economic growth was largely dependent on military spending” – really? I agree the military budget is high but is it really true that every innovation in the post-war period had no impact on growth? Utterly implausible.

One particular confusion that many commentators on GDP make is muddling up this measure of economic activity with the measurement of economic welfare. Economics has always been clear about the distinction. Simon Kuznets, one of the creators of GDP and the national accounts, advocated a measure of welfare instead but lost the argument – this book presents his work as criticism of the definition of GDP, but the quotes here date from a 1937 book in which he was pitching for a welfare approach instead. The production demands of the war – when the military-industrial complex was indeed powerful – swung it in favour of GDP instead.

I do think these seemingly dry questions of measurement are important, and that measurement choices affect the way people behave. However, Gross Domestic Problem is an unsubtle and confused take on the question of GDP. GDP is one measure of economic growth – there could be others, and economic growth is highly desirable, in my view, subject to the huge challenge of moving towards sustainability. Measuring the economy’s size differs from measuring society’s welfare, but they are linked. It’s high time political economy was revived, but understanding how elites acquire economic power deserves some serious social science research rather than conventional assertions.