Watching the global investment markets melt down I can’t help noticing that most of the trillions of dollars of losses are being felt by the rich. Yet these losses are the result of economic policies they pushed for. What is going on here?
Some people like to define left wing politics as being about support for a strong state. This falls apart when you think about it. Not only does it make fascism left-wing (something right-wing commentators delight in arguing on occasion) it also makes anarchists such as Emma Goldman or the sort of society described in Le Guin’s The Dispossessed, right-wing. This offends utterly our intuitive understanding of the term.
From it’s emergence in pre-revolutionary France, the term left-wing has been applied to those who think society is insufficiently fair. The left argues wealth and power are unbalanced, and action should be taken to address this. That may be through the state, unions, collectives or what have you, but something must be done.
Elements on the right have always argued that these imbalances are good: Whites are supposed to have it better than other colours. Women are ordained by God to be subservient to men. The mainstream right however, has tended to argue that the power differentials may not be desirable, but undoing them creates more problems than it fixes. On economic matters in particular the argument has run that a more even distribution of money might be nice, but it’s more important to expand the pie than to worry about cutting it evenly.
That’s a legitimate debate, and almost everyone is somewhere in the middle. We’d rather wealth creation flourished, but also that there was some scope for redistribution from the richest to the very poor. Democratic politics has been about striking the balance.
In the 1930s Keynes demonstrated that, under certain circumstances at least, the total wealth of society would be enlarged by government intervention in ways that also tended to be somewhat redistributive. The postwar boom was built on these ideas. Both extremes disagreed, but while mainstream Left and right argued on exactly how to use Keynesian tools, and whether they were applicable in more inflationary circumstances, both sides saw their use when the economy was in trouble.
Now however, the right has decided to throw Keynes away entirely. The Tea Party is demanding a balanced budget amendment, so that even in an utter economic meltdown borrowings could not be used to stave off depression. The Australian Liberal Party is confused on the topic, but has nevertheless taken to using the existence of a deficit, in the midst of a massive global economic slow-down, as evidence of the ALP’s failures as economic managers.
Many of the people spouting these words presumably don’t know any better. Most of the Tea Partiers believe dinosaurs died out in Noah’s flood, so they can’t really be expected to understand macroeconomics. However, it is clear that stockmarket investors do understand these things – they can see that the economies of the developed world are heading for grim times, and without the possibility of a Keynsian stimulus to address this there is little prospect to fix things. They’ve responded by wiping trillions of dollars off the value of their investments.
Why then have America’s super-rich plowed so much money into the Tea Party. Why do most Australian billionaires donate to the Liberals. Quite simply they’ve gone from caring about the overall size of the economy to thinking that what matters is their share. They’d rather have a huge slice of a smaller pie, than a moderate slice of a larger pie, even if the latter slice is actually larger. They are, in effect, living proof of the claims that people’s happiness is more determined by their relative than absolute wealth.
We’re seeing echoes here of Thomas Frank’s book What’s the Matter With Kansas*. Rich argued that Kansans had become more right-wing as they became poorer. Even though Democrat economic policies were more to the state’s benefit as it fell behind other areas in the economic race, the residents became obsessed with issues of race and sexuality. They were willing to give up increases in wealth as long as people of different skin colour, religion or sexual preference suffered more than they did.
It’s not the same thing here. The categories are not necessarily the same. But what we have in common is a notion that people will sacrifice their own economic success in order to make sure that someone else is suffering more. Ain’t that sweet.
* I know there have been a lot of criticisms of this book and I haven’t looked deeply enough to know if it’s really all that accurate. However, there is no doubt that the phenomenon occurs at least amongst sectors of the population.