Yaba Yaba

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Bread for the poor or circuses for the rich?

with 6 comments

Justin asks: Global Food Crisis: The Limits of Free Market Thinking? The current tide is definitely a wake-up call. But I think Victor Lebow carries more blame than Milton Freedman or Adam Smith (if you haven’t yet, go see the story of stuff. It gives a lot to think about in this context).

The problem is not with the invisible hand, its with the strong hand, which promotes over-consumption of non-sustainable goods, subsidizes meat production (which feeds much less people per hectare) and prioritizes bio-fuelled humvees over wind-farm powered powered public transport. The problem is not with the economic system (there’s frankly very little difference between one and the other nowadays). The problem is with base values.

6 Responses

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  1. Since you have a link to my post on Victor Lebow can you explain what specifically you found faulty in my argument that Lebow was describing, NOT prescribing. I’m guessing that he slipped that ironic passage into an otherwise serious marketing forecasting article and it got through the editors. This was like Swift’s Modest Proposal, only it seems few people actually got the message, least of all modern day anti-consumers.

    My contention seems pretty solid considering that Victor Lebow also wrote a book in 1972 called The Free Market: The Opium of the American People. It savagely attacks consumerism.

    So, for you to say Lebow deserves more blame than Friedman and others makes no sense to me. Either you linked to my post without reading it or ? I don’t know, if you have a problem with my argument and evidence (other than the legitimate argument that I take a long time to get to the point), please spell it out.

    Steve

    April 21, 2008 at 4:49 am

  2. I certainly didn’t intend to reify the notion that the whole problem exists with the invisible hand. I absolutely agree that these problems are rooted in the values of over-consumption, which have spurred the sorts of policies that have brought us to this point.

    Yet, over-consumption has been a function of the market and greedy “economic man”. Self-interest run-a-muck where firms identify new commodities and artificially generate new markets to maintain growth.

    And if I’m not mistaken, the ideal behind this system as described by Adam Smith was to leverage this self-interest in the pursuit of wealth. So while these base values are the problem, these base values have been promoted as fundamnetal elements of the capitalist system.

    And well, we have lots of self-interest going on right now.

    However, what I was really trying to get across was that at the local level (and in the context of the things you mention), it is the invisible hand that is setting prices based upon demand, scarcity and speculation. To let the market rule in the context of ongoing manipulation that is bringing families to their knees shows the limits of the system.

    A part of the problem that I wanted to illustrate is that we have lived (here in the West) with this notion that growth and consumption are a given. People forget that the market produces inherent booms and busts, that resources are in fact scarce, and that the ideal of global capital is a precarious venture. These frightening problems of scarcity and inflation can be best remembered in the context of the Great Depression.

    My point in faulting the invisible hand is to somehow think that the nature of the system will somehow magically correct itself. This is not the time to let it ride, so to speak.

    Overall, it is my sense that all of these realities (over-consumption, misplaced priorities in subsidies, high demand on fuel, poor crop yields in many parts of the world, and the sense the invisible hand will set it straight) are conspiring at once to conjure up the perfect storm.

    BTW, I love the link to the Story of Stuff! Awesome! But I don’t think these issues are mutually exclusive.

    Justin

    April 21, 2008 at 7:02 am

  3. Thanks Justin. well put.
    I didn’t mean to discredit your observations, or to suggest that these forces are mutually exclusive. I absolutely agree with almost everything you say.

    One thing though – the “invisible hand” is, IMHO, a bit of a myth. Even the US is not anywhere near to a “free” market. I was suggesting that all markets these days, from Cuba to Beijing, to Nairobi to Helsinki, are both free and regulated. The critical difference is in the priorities and mechanisms of regulation.

    For example, FUD is a very efficient regulatory tool. You create an artificial fear of “them”, then spend gazzilions on the weapons industry, de facto creating jobs and stimulating the flow of goods in a fundamentally unsustainable market. All this because your economic ethos doesn’t allow you to invest in public good.

    You know – if you’re looking for patterns for a better world, maybe worth noting the anti-patterns as well.

    yishaym

    April 21, 2008 at 12:24 pm

  4. Oh agree, and I would certainly agree that we could describe these “priorities of policy” as anti-patterns!

    Justin

    April 22, 2008 at 2:05 am

  5. Sorry, I didn’t see the replies til now. My point was simply that Lebow seems to have been appalled by what was coming in terms of consumption, that he deserves no blame. He was describing what he saw not prescribing. I’m pretty sure that the quote was a very ironic observation tht he managed to slip into an otherwise mundane forecast on the following year’s economy.

    Steve

    June 1, 2008 at 12:58 am

  6. […] Posted in economics, sustainability by yishaym on June 21st, 2008 In one of my fiery rants some time ago, I referred to Victor Lebow as the evil designer of the absurd linear model which dominates western […]

    Mea culpa « Yaba Yaba

    June 21, 2008 at 2:51 am


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