Posts

The Public Good [2]

drinking water

Photo by Kobu Agency on Unsplash

American schoolkids learn that their country has a republican form of government, which means everybody doesn’t get to vote on everything; we vote for people who do the voting for us.[1] But there’s more to the word republic than that:

republic (n.):  c. 1600, “state in which supreme power rests in the people via elected representatives,” from Middle French république (15c.), from Latin respublica (ablative republica) “the common weal, a commonwealth, state, republic,” literally res publica “public interest, the state,” from res “affair, matter, thing” (see re) + publica, fem. of publicus “public” (see public (adj.)). Republic of letters attested from 1702.

Etymology Online.

Publica (the people, the state) + Res (affair, matter, thing) = “the people’s stuff.” The republican state holds the people’s stuff in trust, and its elected representatives, as trustees, administer it for the public benefit. That’s the plan, anyway. A more elegant term for “the public’s stuff” is “commonwealth”:

commonwealth (n.):  mid-15c., commoun welthe, “a community, whole body of people in a state,” from common (adj.) + wealth (n.). Specifically “state with a republican or democratic form of government” from 1610s. From 1550s as “any body of persons united by some common interest.” Applied specifically to the government of England in the period 1649-1660, and later to self-governing former colonies under the British crown (1917). In the U.S., it forms a part of the official name of Pennsylvania, Massachusetts, Virginia, Kentucky, and Puerto Rico but has no special significance.

Etymology Online

Several online searches turned up a surprisingly long and illuminating list of things that are or used to be considered part of the common wealth trust portfolio. For example:

  • education
  • news
  • law
  • governmental administrative functions
  • healthcare
  • childcare
  • clean water
  • clean air
  • certain interior spaces
  • certain exterior spaces — e.g. parks
  • natural wonders
  • shoreline and beaches
  • mail and home/rural delivery service
  • trash removal
  • public toilets
  • sewage processing
  • food, clothing, and shelter
  • heat and lights
  • streets, roads, highways
  • public transportation
  • freight shipping
  • telephone and telegraph
  • pest control
  • use of public lands/wilderness access
  • the “right to roam”
  • the “right to glean” unharvested crops
  • the right to use fallen timber for firewood
  • defense
  • police and fire
  • handicapped access

Some people argue for the inclusion of additional, more contemporary items on the list:

  • information
  • internet access
  • net neutrality
  • open source software
  • email
  • fax
  • computers
  • cell phones
  • the “creative commons”
  • racial, gender, national, and other forms of equality
  • birth control
  • environmental protection
  • response to climate change

The res publica is made up of those goods, services, and places everybody is entitled to just by being human, or by being a citizen or member of the applicable socio-cultural institution. Somebody’s got to administer all that, and somebody’s got to pay for it. Plus, as we saw last time, there are competing private interests as well.

You’ve heard of technological singularity — the point at which technology overtakes human ability — e.g., artificial intelligence and machine learning. Nowadays, administration of both private interests and the commonwealth has been delegated to a near-universal economic singularity:  the “free” market, carried out in the form of American-style capitalism, as also exported to the rest of the world. Superstar Italian-American economist Mariana Mazzucato[2] thinks this practice has skewed the private/public balance to the point where the commonwealth has been eliminated from policy-making:

“[Government is] an actor that has done more than it has been given credit for, and whose ability to produce value has been seriously underestimated – and this has in effect enabled others to have a stronger claim on their wealth creation role. But it is hard to make the pitch for government when the term ‘public value’ doesn’t even currently exist in economics. It is assumed that value is created in the private sector; at best, the public ‘enable’ [that privately created] value.

“There is of course the important concept of ‘public goods’ in economics — goods whose production benefits everyone, and which hence require public provision since they are under-produced by the private sector.

“… the story goes [that] government should simply focus on creating the conditions that allow businesses to invest and on maintaining the fundamentals for a prosperous economy:  the protection of private property, investments in infrastructure, the rule of law, an efficient patenting system. After that, it must get out of the way. Know its place. Not interfere too much. Not regulate too much. Importantly, we are told, government does not ‘create value’; it simply ‘facilitates’ its creation and — if allowed — redistributes value through taxation. Such ideas are carefully crafted, eloquently expressed and persuasive. This has resulted in the view that pervades society today:  government is a drain on the energy of the market, and ever-present threat to the dynamism of the private sector.”

The Entrepreneurial State: Debunking Public vs. Private Sector Myths (Rev. 2018) See also The Value of Everything: Making and Taking in the Global Economy (2018)

Prof. Mazzucato isn’t the only one concerned about this. When Occupy Wall Street puts up its “We are the 99%” sign, when voters support populist politicians[3], when French farmers don yellow vests and riot in Paris, when Malala Yousafzai advocates for educational opportunity, when Greta Thunberg scolds world leaders on climate change… all these are advancing their own responses to the current public/private balance.

In the search for remedies, the younger generation is more likely than their elders to reject populist nationalist politics and private capitalist solutions, and to push instead for an expanded commonwealth administered under a new version of an economic system many of their elders consider an economic dirty word.

More on that next time.

[1] Pure democracy — all those ballot initiatives — has joined republican lawmaking since California’s 1978 Proposition 13.

[2] The Times called her “the world’s scariest economist.”

[3] Here’s a list from the BBC of European nationalist politicians.

The Public Good

14er

Back in the day, my wife and I used to hike Colorado’s “14ers” — mountains with summits 14,000 feet or higher. We got to a trailhead brutally early one morning to find a gate and a mining company’s sign warning us off.

Seriously — how can somebody own a mountain?! Or put up a sign telling you kids to stay off my lawn?

Another car was parked nearby, empty. They’d obviously ducked the gate. We met them at the summit.

We’d heard rumors of this. Not long after, it made the headlines. A couple years later the sign and gate were gone. Chalk up a win for Mother Nature and wide open spaces, for a change.

At the time, I’d been in law school long enough to spot a handful of legal issues. One was the notion of “the general welfare,” expressed in the Preamble to the U.S. Constitution:

“We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.”

Hiking up to the view from the top of a 14er promotes the general welfare, no doubt. On the other hand, the mining company’s lawyers were afraid of compromising its private right to buy, sell, own, rent, and otherwise use and profit from land. Which raised a second legal issue:  the doctrine of “adverse possession”:

“Adverse possession is a legal theory under which someone who is in possession of land owned by another can actually become the owner if certain requirements are met for a period of time defined in the statutes of that particular jurisdiction. Adverse possession was historically used as a means of encouraging people to bring unused or uninhabited land into productive use.

“In past centuries in England, a person who farmed otherwise unused land for a long period of time could be rewarded with title to that land for helping to provide food to the hungry nation. In America, the adverse possession theory was often used to encourage settlers to move onto frontier properties and occupy and improve them in exchange for ownership of the land. This has evolved into the modern day theory requiring a set of common conditions to be met for a period of time, which is defined in the law of a particular jurisdiction.”

Study.com

Tilling fallow ground to feed the hungry benefits the general welfare, but nobody was going to till a 14,000’ mountaintop. Still, the mining company didn’t want hikers tapping its gold and silver veins. Which raises a third legal issue:  the “freedom to roam.”

“The freedom to roam, or “everyman’s right”, is the general public’s right to access certain public or privately owned land, lakes, and rivers for recreation and exercise. The right is sometimes called the right of public access to the wilderness or the “right to roam.”

“In Scotland, Finland, Iceland, Norway, Sweden, Estonia, Latvia, Lithuania, Austria, Czech Republic and Switzerland, the freedom to roam takes the form of general public rights which are sometimes codified in law. The access is ancient in parts of Northern Europe and has been regarded as sufficiently basic that it was not formalised in law until modern times. However, the right usually does not include any substantial economic exploitation, such as hunting or logging, or disruptive activities, such as making fires and driving offroad vehicles.

“In England and Wales public access rights apply only to certain categories of mainly uncultivated land.”

Wikipedia

I wanted my “freedom to roam” that morning, and ducking the gate was a crude way to balance  public benefit and private rights:  the mining company could have all the gold and silver it wanted (their mine was hundreds of feet downslope — my brother-in-law worked there), it was safe from anybody trying to turn its claim into food for the hungry, and I was in it for the “recreation and exercise” — and the vast, stark, unforgiving beauty, and (if the wind ever stopped blowing) the immense solitude and silence that makes you feel about the size of a microbe. (Roaming in the wilderness will do that to you. No wonder it’s a public right.)

Economic and legal analyses make finding that balance much more complicated, of course, and whoever wrote this Wikipedia article did a nice job of distinguishing among terms of art like the general public good, specific public goods, general societal welfare, common goods, the public interest, etc. For our purposes, we’ll just note that some things about life on this planet benefit everybody, and for them we need to balance private and public benefit (ownership, use, enjoyment, access, rent, etc.) and cost (development, maintenance, preservation). Finding that balance has also become the basis of a wide and widening economic generation gap.

More on that next time

Progressive Capitalism

torn dollar bill

Torn dollar bill image source and license.

We’ve been looking at economic winners and losers in the zero-sum economy — particularly in the context of higher education, where cultural belief in the importance of college and post-graduate degrees on upward mobility and success in the job market is driving behavior that harms both parents (the college admissions scandal) and the economic and mental health of their children (student loan debt, general anxiety disorder, depression, suicide).

This series of blog posts is now in its third year — throughout, we’ve seen how hyper-competitive capitalism and its staunch faith in the implicit justice of the “free” market is causing other economic loses. For example:

  • the stagnation of middle class real incomes;
  • the rise of the numbers of statistically poor people in the U.S.;
  • the dismantling of compassionate social safety nets in favor of expensive, counterproductive, and humiliating replacements;
  • the rise of the “rentier” economy in which formerly public benefits have been privatized, making them accessible only to those who can afford them through the payment of economic “rents”;
  • the end of the American ideal of upward social and economic mobility;
  • the high cost of housing and the death of the American dream of home ownership;
  • the elimination of “normal” jobs through off-shoring, outsourcing, and the delegation of productivity to intelligent machines;
  • the advent of the short-term, contract-based “gig economy” with its lack of fringe benefits and its precarious prospects for sustainable income;
  • economic inequality that favors the wealthiest of capitalists at the expense of the bottom 90% (or 99%, or 99.9%, depending on your data and point of view);
  • the creation instead of an insular top-level “meritocrat” socio-economic class;
  • the new state of “total work” and the “monetization” of goods and services;
  • rising rates of career burnout, mental illness, and suicide resulting from social isolation and the vain struggle to find meaning and purpose at work;
  • the rise of corporate nation-states with economic and policy-making power that dwarfs that of many governmental nation-states;
  • the private (non-democratic) social policy-making initiatives of the wealthiest elites;
  • and much, much more.

Nobody meant economic policy to do this, but it has, for roughly the past 30-40 years. Good intentions; unplanned results.

We’ve seen that both plutocrats and progressives advocate for systemic change, while status quo inertia weighs in on the side of those who don’t see what all the fuss is about, since capitalism is undeniably the best economic option and always has been, and besides it’s still working just fine, thank you very much. Instead of meaningful discourse, we have a predominant nostalgic, populist doubling down on the neoliberal socio-economic cultural ideology that jet-propelled post-WWII recovery but finished running its course in the 1970s, while the retrenchers and the media slap those who beg to differ with the kiss-of-death label “progressive.” As a result, we’re left with incessant lobbing from one end of the polarized spectrum to the other of ideological bombs that originate in data and analysis skewed by cognitive biases, intentional blindness, and fake news . Economic policy-making resembles WWI trench warfare — a tactical grinding down of the opposition and the numbing and dumbing of everyone else. It was a bad idea then, and it’s still a bad idea now.

I had no idea this is what I was getting into when I decided three years ago to research and write about the new economy and the future of work.

It’s in the context of this toxic environment that Economics Nobel Laureate Joseph E. Stiglitz, offered his “progressive capitalism” alternative, based on “the power of the market to serve society.” Progressive Capitalism Is Not an Oxymoron: We can save our broken economic system from itself, New York Times (April 19, 2019). His article, like virtually all of the economics books and articles I read these days, begins with a long parade of evils and ends with a handful of policy ideas. His version of the former is by now quite familiar:

“Despite the lowest unemployment rates since the late 1960s, the American economy is failing its citizens. Some 90 percent have seen their incomes stagnate or decline in the past 30 years.

“This is not surprising, given that the United States has the highest level of inequality among the advanced countries and one of the lowest levels of opportunity — with the fortunes of young Americans more dependent on the income and education of their parents than elsewhere.

“There is a broader social compact that allows a society to work and prosper together, and that, too, has been fraying. America created the first truly middle-class society; now, a middle-class life is increasingly out of reach for its citizens.

“We confused the hard work of wealth creation with wealth-grabbing (or, as economists call it, rent-seeking).

“Just as forces of globalization and technological change were contributing to growing inequality, we adopted policies that worsened societal inequities.

“Even as economic theories like information economics (dealing with the ever-present situation where information is imperfect), behavioral economics and game theory arose to explain why markets on their own are often not efficient, fair, stable or seemingly rational, we relied more on markets and scaled back social protections.

“Politics has played a big role in the increase in corporate rent-seeking and the accompanying inequality.

“Markets don’t exist in a vacuum; they have to be structured by rules and regulations, and those rules and regulations must be enforced.

“We are now in a vicious cycle: Greater economic inequality is leading, in our money-driven political system, to more political inequality, with weaker rules and deregulation causing still more economic inequality.

“If we don’t change course matters will likely grow worse, as machines (artificial intelligence and robots) replace an increasing fraction of routine labor, including many of the jobs of the several million Americans.

“The prescription follows from the diagnosis: It begins by recognizing the vital role that the state plays in making markets serve society.

“Progressive capitalism is based on a new social contract between voters and elected officials, between workers and corporations, between rich and poor, and between those with jobs and those who are un- or underemployed.

“Part of this new social contract is an expanded public option for many programs now provided by private entities or not at all

“This new social contract will enable most Americans to once again have a middle-class life.

“The neoliberal fantasy that unfettered markets will deliver prosperity to everyone should be put to rest.

“America arrived at this sorry state of affairs because we forgot that the true source of the wealth of a nation is the creativity and innovation of its people.”

His point seems to be that merely reciting litanies of economic woes won’t bring about systemic relief — for that, we need to embrace an essential factor:

Paradigms only shift when culture  shifts:
new ideas require new culture to receive them,
and new culture requires new belief systems.

Systemic change requires cultural change — remodeled institutions and revised social contracts that tether ideas to real life. Trying to patch policy ideas into the existing socio-economic system is like what would happen if a firm were to abruptly change its products, services, and strategic and marketing plans without bothering to change its mission statement, values and beliefs, and firm culture.

Like that’s going to work.

Coming up, we’ll look beyond policy bombs to the higher ground of revised cultural beliefs, starting with next week’s search for the “public” that’s gone missing from the Republic.

Economic Darwinism

social darwinism

The 19th Century’s Gilded Age of the Robber Barons came hot on the heels of The Origin of the Species. Little wonder that…

 “Soon, some sociologists and others were taking up words and ideas which Darwin had used to describe the biological world, and they were adopting them to their own ideas and theories about the human social world. In the late nineteenth and early twentieth centuries, these Social Darwinists took up the language of evolution to frame an understanding of the growing gulf between the rich and the poor as well as the many differences between cultures all over the world.

“The explanation they arrived at was that businessmen and others who were economically and socially successful were so because they were biologically and socially “naturally” the fittest. Conversely, they reasoned that the poor were “naturally” weak and unfit and it would be an error to allow the weak of the species to continue to breed. They believed that the dictum “survival of the fittest” (a term coined not by Charles Darwin but by sociologist Herbert Spencer) meant that only the fittest should survive.”

Social Darwinism in the Gilded Age, Kahn Academy

The result was Social Darwinism:

“The term ‘social Darwinism’ refers to the deterministic philosophy of Englishman Herbert Spencer that applied, to humans and markets, Darwinian biological and evolutionary concepts of natural selection.

“Spencer offered his philosophical defense of individualism and laissez faire in Social Statics (1851). He coined the term “survival of the fittest” in Principles of Biology (1867), arguing that human progress resulted from the triumph of superior individuals and cultures over their inferior competitors; poverty was evidence of inferiority.

“Anything that interfered with the self-improvement of superior individuals or markets was to be resisted. What came to be called “social Darwinism” was used to argue for unrestrained economic competition and against aid to the unfit poor. The state was not to hinder the strong or assist the weak, interceding only to protect individual freedom and rights. “

Capitalism and Western Civilization: Social Darwinism, National Association of Scholars

Social Darwinism has since been widely discredited in academia, but Pulitzer-prize winning economics columnist and professor of public affairs Steven Pearlstein was dismayed to find it alive and well in current hyper-competitive, zero-sum economic policy, as revealed in numerous studies showing that certain genetically inherited traits play “an outsized role in determining economic success.” The list includes intelligence, personality, height, and good lucks, all of which statistically affect income and likelihood of being favorably judged on leadership qualities. Add parental nurturing practices — such as those of the new “Meritocrat” economic class we’ve been looking at — and “whether it’s by way of the genes we inherit or the circumstances in which we are raised, the parental lottery is more important than ever in determining economic outcomes.” It’s Time To Abandon The Cruelty Of Meritocracy, The Guardian (Oct. 13, 2018).

Pearlstein concludes that the luck of the genetic and nurturing draw “must always play a significant role in who achieves economic success” and that “we must also acknowledge that there is a point beyond which the consequences of the parental lottery can never be overcome.” Disconcerted by his own findings, Pearlstein calls for remedial action:

“No matter how hard we might try to make it otherwise, there is a fundamental and irreducible level of unfairness to market competition, one that undermines the moral legitimacy of market outcomes and provides a justification for taking reasonable steps to make them more equal.

“Because of heritability and upbringing, there can never be genuine equality of opportunity. More socialist countries in Europe and Asia have gone a long way toward equalizing access to healthcare, education, nutrition, childcare and even disposable income, and yet they have not come close to eliminating the transmission of family advantage or disadvantage. Surely we should do more along those lines to equalize opportunity in the United States?”

It’s Time to Abandon the Cruelty of Meritocracy

Economics Nobel laureate Joseph E. Stiglitz offers an alternative to economic Darwinism which he calls “progressive capitalism.”

“Despite the lowest unemployment rates since the late 1960s, the American economy is failing its citizens. Some 90 percent have seen their incomes stagnate or decline in the past 30 years. This is not surprising, given that the United States has the highest level of inequality among the advanced countries and one of the lowest levels of opportunity — with the fortunes of young Americans more dependent on the income and education of their parents than elsewhere.

“But things don’t have to be that way. There is an alternative: progressive capitalism. Progressive capitalism is not an oxymoron; we can indeed channel the power of the market to serve society.”

Progressive Capitalism Is Not an Oxymoron: We can save our broken economic system from itself, New York Times (April 19, 2019)

More next time.

What’s With Student Loans?

obama state of the union 2013

“It’s a simple fact:  The more education you’ve got,
the more likely you are to have a good job
and work your way into the middle class.”

2013 State of the Union Address

President Obama was repeating an enduring cultural belief. Maybe it was still true when he said it, but not anymore — for a lot of reasons we’ve looked at throughout this series, but especially in light of today’s social and economic calamity of soaring higher education costs and student loans.[1]

student debt graph

Chart from Next Gen Personal Finance (May 30, 2015)

Student debt grew steadily 2000-2014. Toward the end of that period, a revenue provision tacked onto the 2010 Affordable Care Act gave the Federal government a monopoly on the student loan business. Since then, total loans have risen exponentially — by 50%, to $1.52 Trillion.

Nationalizing student debt has been a government money-maker, in terms of both capital and income:

“The trillion plus in student debt that the state holds makes up a plurality of its financial assets — 37 percent, far more than national reserves officially held in gold or foreign currency.

“Because the government’s borrowing costs are so low, student lending is incredibly profitable. The Department of Education expects to reap $18.99 in profit on evert $100 in loans originated in 2014… and we’re talking over $25 billion in projected negative subsidy — that is, profit — off the 2014 cohort alone.”[2]

Kids These Days: The Making Of Millennials, Malcolm Harris (2017)

Meanwhile, educational costs have also soared.

educational costs

Tuition data from National Center for Education Statistics. Inflation data calculated using 1963–1964 tuition and tuition increase at rate of inflation from CPI Inflation Calculator. Graph by Noa Maltzman

Today, average undergraduate loans are $30,000. Paying them off represents a 21-year mortgage. What’s the ROI from the students’ point of view? Answering that question requires examining (1) the loans themselves — how they’re originated, paid off, etc., (2) what higher education is doing with the loan proceeds students are handing over, and (3) the cultural belief Pres. Obama articulated. For all of that, I refer you to the book Kids These Days, cited above, and to a 70-minute film Broke, Busted, and Disgusted, which I just watched.[3]

What’s to be done? The remedies in the film are prospective — they’re too late for the $1.52 Trillion already in place. Going forward? Well, it is an issue in the election coming up — at least for the Democrats — and here are summaries of candidate proposals:

Writing this makes me revisit my own experience with student loans and the cost of higher education.

I went to an expensive private college. My financial aid package included scholarships, work study, and student loans. I paid off the loans in five years. The relief was tangible. I vowed never again.

My financial aid package at DU’s MBA/JD program included scholarships and student loans. I declined the loans and worked a lot, sometimes full time. I made it through the first three years without loans and would have finished that way. An accountant friend told me I was crazy — it was cheap money. I took out a loan my fourth year. I paid it off in six years. The relief was tangible. I vowed never again.

In 2009, just after the Great Recession and an ill-timed, ill-advised, and poorly executed exit from law practice, I was short of funds to pay for two of my kids’ final years at expensive private colleges (they’re two years apart in age, but their final years coincided). I took out $30.000 in “parent plus” loans to make up the difference. I declared bankruptcy the following year, and found out student loans hadn’t been dischargeable since 2005.

In 2013, as part of an attempt at mid-life reinvention, I was accepted into a graduate program in sports psychology at DU. There was no way to pay for it other than student loans. I decided not to attend. The relief was tangible. Lesson learned.

In 2016, I qualified for disability income. I used most of my back-pay award to pay off my parent-plus loans. The relief was tangible. Lesson learned. I vowed never again.

It’s easy for me to feel entirely responsible for my own history. But as for today’s reality, as a young friend said recently, “I’m starting to believe it’s not all my fault.” Coming up, we’ll look at more economic support for that thought.

[1] As I write this, the headlines today show Felicity Huffman entering prison for her role in the college admissions scandal.

[2] Citing Department of Education Student Loans Overview Fiscal Year 2014 Budget Proposal. Click here for the 2020 numbers

[3] Of course the documentary has an agenda, but it’s well-done and worth watching.

Can Capitalism Buy Happiness? [2]

smiley face

We’ve been looking at the zero-sum economy’s winners and losers — the new “meritocracy” vs. the “precariat” and the Millennials.

We’ve also seen that winners and losers find common ground in higher education, where students of all stripes are increasingly stressed to the point of mental ill-health  — not by the demands of higher learning, but by the enveloping culture of hyper-competitive capitalism.

One predictable response has been for the established, older, prosperous, and powerful to wag the shame finger and tell the kids to quit whining and buck up:

“Student protests and demands for better mental health services are frequently dismissed in the press. ‘We just can’t cope with essay deadlines, and tests stress us out, moan snowflake students,’ read a headline in the Daily Mail in November 2017. In September 2018, the Times described today’s students as ‘Generation Snowflake’ and suggested that ‘helicopter parents’ had ‘coddled the minds’ of young people.”

The way universities are run is making us ill: inside the student mental health crisis. The Guardian (Sept. 27, 2019).

Truth is, we just don’t like to talk about mental illness, and if we regard it at all, tend to shoo it away as a personal problem or character flaw. Plus, there are enduring cultural myths that capitalism and its marketplace are “free,” and that anyone can make it with enough gumption. Together, these attitudes foster the “snowflake” judgment.

Mental illness is ultimately about a clash between the “reality” of the individual deemed to be mentally ill and the “reality” of the prevailing culture.[i] Conventional thinking sides with the culture, and uses pharmaceutical and other therapeutic interventions to realign the individual. As a result, the list of economic stressors is accepted as part of the culture’s normal life to which individuals are expected to conform,

Meanwhile, viewed on its own terms — outside of its cultural context — the list itself is long and dismaying. For example:

  • There has been a forty-year drought in middle class real income growth, with most households drifting downward while an economic elite soars at the top.
  • The percentage of Americans who are considered to be poor by Federal standards is approaching 50% — meaning they have no or limited access to what were historically considered “public goods” such as shelter and sustenance, education and healthcare, etc.
  • Public support safety nets have been replaced by the privatization of essential services. The social services that remain are expensive for the government to administer and are demeaning and counter-productive for recipients;
  • Soaring educational costs mean soaring and strangling student loans.
  • Runaway housing costs have made conventional home ownership unaffordable for the lower economic classes.
  • Due to the rise of the “rentier” economy, the general public must increasingly pay capital holders for the use and enjoyment of essential resources and intellectual property.
  • Upward mobility for the lower 90% is now a thing of the past (the “glass ceiling”). Meanwhile the top 10% is protected against drifting downward (the “glass floor”).
  • Touted “job creation” is mostly “gig economy” contract work, with no assurances of sustainability and no benefits such as healthcare, retirement, etc.
  • Prospects for sustainable income are bleak, and the new job market requires the “hustle” and the “grind” and the monetization of everything in a state of “total work.”
  • Meanwhile, GDP “growth” is largely due to production increasingly shifted not just off-shore, but to intelligent machines. Benefits accrue to capital holders, not wage-earners.
  • These job trends have increasingly resulted in social isolation and an unfulfilled struggle to find meaning and purpose at work.
  • Meanwhile a new generation of huge and powerful “corporate nation-states” now challenge conventional notions of national sovereignty, democracy, and policy-making.
  • The same is true of “philanthrocapitalism” and “social entrepreneurship.”

And there’s more.

While “snowflake” judgments turn a blind eye, for the past several years there has been a counter commentary that looks at the list systemically:  it examines how the capitalistic over-culture creates social mental ill health which is then transmitted to the individual. I.e., it asks if the culture’s assimilation of contemporary capitalistic belief and practice has become toxic to the point that it is making both society and its individual members sick. This is a huge shift in perspective, which we’ll explore further.

[1] For more on how cultural beliefs create collective reality, you might take a look at this article, which evaluates mental health diagnosis and treatment in light of the Cartesian worldview that still dominates the western world:  i.e.,the dualistic thinking that separates the natural world, which can be known scientifically, from the realm of soul or spirit, which can’t. I have talked about how cultural beliefs created social reality in prior blog series in this forum. I also address it in my other blog.

Can Capitalism Buy Happiness?

smiley face

Over two years ago, the first blog post in this series asked, “Can money buy happiness?” Today’s question looks past the medium of economic exchange to the more foundational sociological and psychological implications of contemporary hyper-competitive capitalism — a good example of which is the “meritocracy trap” we looked at last time, which clearly is not making capitalism’s elite happy, but instead is driving maladaptive behavior like the college admissions scandal.

The scandal evokes the kind of horrified fascination you get from reading the National Enquirer headlines in the checkout line:

“A teenage girl who did not play soccer magically became a star soccer recruit at Yale. Cost to her parents: $1.2 million.

“A high school boy eager to enroll at the University of Southern California was falsely deemed to have a learning disability so he could take his standardized test with a complicit proctor who would make sure he got the right score. Cost to his parents: at least $50,000.

“A student with no experience rowing won a spot on the U.S.C. crew team after a photograph of another person in a boat was submitted as evidence of her prowess. Her parents wired $200,000 into a special account.”

Actresses, Business Leaders and Other Wealthy Parents Charged in U.S. College Entry Fraud, New York Times (March 12, 2019)

What the…?

The parents who wrote those big checks now face a stiff legal price, but why did they do it in the first place? An ongoing discussion over the past several years[i] suggests an answer:  they did it because of the “meritocracy trap” as evident in higher education, — an economic necessity for more than just the elite — where the current dynamics of of how capitalism is practiced are a significant contributor to mental ill health.

A long article on that topic came out last weekend:  The Way Universities Are Run Is Making Us Ill’: Inside The Student Mental Health Crisis. The Guardian (Sept. 27, 2019). The subhead reads “A surge in anxiety and stress is sweeping UK campuses. What is troubling students, and is it the universities’ job to fix it?” The article’s U.K. examples mirror those that prompted the USA’s college admission scandal,. Predominant mental health issues on both sides of the Atlantic include general anxiety disorder, depression, and “an alarming number of suicides.” What’s behind all this? Consider these quotes from the article:

“In the drive to make universities profitable, there is a fundamental confusion about what they are for. As a result, there has been a shift from prizing learning as an end in itself to equipping graduates for the job market, in what for some can be a joyless environment.

“Studies have looked at the impact of social media, or lack of sleep caused by electronic devices, as well as the effects of an uncertain job market, personal debt and constricted public services.

“In his book Kids These Days: The Making of Millennials, Malcolm Harris … identifies the pressures of the labour market, rising student debt and a target-driven culture as contributing to steep increases in anxiety and depression among young people.

“Driving our universities to act like businesses doesn’t just cannibalise the joy of learning and the social utility of research and teaching; it also makes us ill,’ wrote Mark Crawford, then a postgraduate student union officer at UCL, in a 2018 piece for Red Pepper magazine… ‘It’s self-worth being reduced to academic outcomes, support services being cut, the massive cost of housing,’ he says.

“[Mental health authorities] have noticed a fall in participation. It’s getting harder to fill up events, most likely a symptom of the sharp increase in students living far away from campus to save money… Others have limited time as they juggle studies with paid work.

“For [Sean Cullen, a student featured in the article], money worries have been a grinding and ever-present aspect of his university experience. In his first year, he socialised more than he does now. But given that a single night out costs as much as a weekly food shop, he soon began to think twice about going out with friends. To complicate matters, the amount he receives from Student Finance England, the body responsible for student loans, changed year by year, with unpredictable amounts and repayment terms. “The financial aid is getting worse and worse, even though the cost of living is going up,” he says.

“In 2017, Cullen was elected as the student union’s disability officer… He heard accounts of mental health problems from hundreds of other students, many of whose experiences chimed with his own. ‘I’ve not yet met a student that hasn’t experienced high levels of stress while studying, whether it’s because of deadlines, balancing paid work, or problems with housing,’ he says.

“While many students survive more or less on their overdrafts, …many have mental health problems in their final year. ‘Nowadays, getting a degree doesn’t necessarily guarantee you a job, or not a better job than without one,’ he says.

“[The need to work many hours per week] has an impact not only on academic performance but on students’ ability to fully participate in university life.

“Students exhausted from working while studying full time, and still struggling to cover their basic living costs, are bound to be more anxious about deadlines and exams. ‘It’s all the environmental stuff that makes it more stressful… If you’re tired, you haven’t had time to study, you have to make a long journey to university, it’s all cumulative.’”

Cuts in social services, educational and housing costs, social isolation, student loans, constricted access to upward mobility, a stingy job market, precarious prospects for sustainable income, a struggle to find meaning and purpose at work… these are economic issues, not education issues. This series has looked at all of them. Next time we’ll look further into what’s behind them..

[1] See, for example, this NCBI study:  “Anxious? Depressed? You might be suffering from capitalism: Contradictory class locations and the prevalence of depression and anxiety in the United States.”