This was an important column from @RanaForoohar, making an essential link between economic dysfunction and populist politics, though the reversal of cause and effect means the solutions offered don’t really confront the problem. 1/…
The central idea is that wealth (NB: defined as asset values, not the economy’s production of use-values) has decoupled from growth, which is another way of saying that investment is creating bubbles rather than going to productive ends. 2/
It’s a significant advance that mainstream thinking is coming to accept the distinction between productive and unproductive investment. But the McKinsey analysis (which Foroohar accepts and extends to the effect on consumption) gets things backward: 3/
It’s not that low interest rates increase real estate valuations, driving up the cost of housing and thereby reducing consumption—a chain of reasoning still very much stuck in neoliberal forms of thought. 4/
Quite the reverse, the problem is that consumption has stagnated because labor has been squeezed for decades. 5/…
This dynamic is exacerbated by extreme inequality among workers, which is a result of both rising wage inequalities within countries and the devastating inequality between the Global North and Global South. 6/…
With the large majority of workers weak and global consumer markets therefore unpromising, capital is chasing its own tail driving up asset prices—expanding nominal value rather than competing to raise the productivity of goods and services. 7/
Unfortunately, the artificial scarcity created by inequality and lack of productive investment is experienced on the ground as intense competition among different occupations, races, ethnicities, and nationalities, providing fertile ground for reactionary politics. 8/
So solving this core problem of inequality between labor and capital and between the rich and poor countries is the key to both getting the global economy back to “healthy” growth and to defusing the threat of violent ethnonationalist and international conflict. 9/
Expanding the supply of affordable housing, which Foroohar suggests, is a key part of the politics we need but it doesn’t get us very far unless it’s coupled with a global strengthening of labor and a major increase in global development investment. /10

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More from @jwdwerner

30 Oct
A thread on the path to World War I. Parallels between UK–Germany conflict then and US–China conflict today—and the obliviousness of elites conducting it—make it urgent to learn this now largely forgotten history. Excerpts from J. Joll, The Origins of the First World War, 2nd ed.
This arms race dynamic should be familiar: imagining that intensifying the threat you pose to your rival will lead to safe subordination of the other (“deterrence”) rather than unleashing an explosive spiral of insecurity and nationalism:
It’s important to keep in mind the larger context that encouraged the arms race dynamic to spin out of control. First, intense anxiety that the other country posed an intolerable threat to future growth:
Read 9 tweets
9 Jul
1. Since it pains me to write an essay without footnotes, I thought I’d do a thread on all the reporting, research, and thinking that stands behind this article.
2. First, a bit more of my own thinking on the historical forces behind today’s global crisis of democracy. Both to explain the worldwide reactionary turn and to develop a strategy to revive democracy, we need a systemic conceptualization, not moralizing.…
3. Short version: the advance of formal democracy and negative freedoms over the last 40 years proceeded at the expense of substantive democracy and positive freedoms, leaving the foundations rotten for all. Here’s a wonderful discussion of these issues:…
Read 25 tweets
1 Apr
Biden’s pitch on public investment. It’s not just a misrepresentation of the US–China conflict. It’s also a child’s conceptualization of the global crisis of democracy: USA=democracy, but no one will like us if we’re not big and strong! And then they won’t want to be like us! 1/ Image
As this and endless versions of the same op-ed show, the US elite does not take democracy seriously. Rule by the people requires not just a periodic option to vote but, first, a meaningful choice—real differences among candidates leading to different outcomes in governance. 2/
And second, it requires that the voters, outside the one day they get to cast a ballot, are living lives that equip them with the self-confidence, knowledge, status, and sense of belonging in the community to make participation in politics both desirable and meaningful. 3/
Read 14 tweets
13 Mar
The liberal international order, functioning as designed on the single most consequential question it faces right now. I guess India and South Africa are sinister revisionist powers. 1/…
If we want to understand what’s going on in the world, the dominant US foreign policy framing dividing the world between democracies and autocracies is not very useful. As this episode illustrates, it’s the rich vs poor divide that is more often the salient distinction. 2/
The dominant ideology is so powerful and blinding that when someone in the US says “the democracies”, it’s almost always coterminous with the rich, former colonial countries. It’s frequently used in situations that obviously do not include most of the world’s democracies. 3/
Read 8 tweets
11 Mar
1. The main thing happening here is everyone dressing up their pet priorities in anti-China rhetoric because, as Douglas Holtz-Eakin says, “Hating China is a big bipartisan thing”. But underneath the opportunism there’s a very dangerous substantive issue.…
2. We should celebrate the breakdown of the neoliberal prohibition on setting economic priorities openly and democratically. But what’s emerging in its place is a bipartisan consensus around a nationalist industrial policy to hoard scarce global growth for the US.
3. Even those in the executive branch—the home of universal considerations—seem to have given up thinking about how the interests of the US could be aligned with the interests of the rest of the world, offering instead only scaremongering on China to try to bring others along.
Read 7 tweets
30 Jan
Good news! Western commentators too often conflate Xi’s centralization with his reactionary politics. These need to be conceptually separated—in China and around the world—because progressive politics also requires overcoming fragmented politics, but for very different ends.
A big reason Western commentators interpret centralization under Xi as nothing but authoritarianism is that don’t really know anything about how the Chinese state has operated for the last forty years. So a crude stereotype of monolithic Oriental despotism fills in the gap. 2/
In fact the state became highly fractured among jurisdictions and within officials (their public duties at odds with their private interests). What Xi is attempting with the anti-corruption and Party discipline campaigns is to regain the center’s ability to impose priorities. 3/
Read 4 tweets

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