Book Review: "The Dawn of Everything" by David Graeber & David Wengrow

I finally got around to reading ‘The Dawn of Everything: A New History of Humanity’ by the late, great David Graeber and David Wengrow. Graeber was a first-rate anthropologist and leftist thought-leader, and his tragic death during the pandemic was a huge blow to the international left. While Graeber’s ideas were often insightful and revolutionary, his written work was often dry and difficult. While frequently targeting mass-market ‘grand theorists of history’ such as Jared Diamond, Steven Pinker and Yuval Noah Harari for debunking, he remained firmly grounded in the academic realm. ‘The Dawn of Everything’, a collection of essays and lectures compiled with his collaborator David Wengrow in the ten years prior to his death, is very much of this mould: too interested in debating the ‘big questions’ to be rigorously academic, but too dedicated to the material minutiae and petty historiological disputes to sell a new ‘theory of everything’. In that way, it’s just as frustrating and enlightening as Graeber’s other work, and thus, a fitting final testament.

Let’s begin with the title. Perhaps a more accurate one would have been ‘The Dawn of Inequality: A New Pre-history of Humanity’. Graeber & Wengrow’s primary research question - with the exception of dull, Weberian digression on the birth of the state - is to identify, or at least challenge received accounts of, the origins of inequality. In this, they follow the great tradition of debating liberalism’s theodicy problem - if men are born free, as ideology presumes, why are we now so unequal? Unfortunately, they use as a framing device the ‘debate’ between a fundamentally Hobbesian and Rousseauian narrative of the origins of society - in the former, man is by his nature self-interested and to avoid a life that is nasty, brutish and short, binds himself to the rule of a sovereign. Whereas in the latter, man in his natural state lives in a state of primitive freedom and leisure, which he is seduced into giving up by the material comforts of ‘civilization’.

Graeber & Wengrow point out that this dichotomy, taught to hundreds of thousands of fresh-faced undergrads each year, is dull and limiting. But by framing the book in those same terms they do a huge disservice to the diversity of the ideological debate around liberty and inequality. On the one hand, Hobbes and Rousseau wrote more than a hundred years apart; they were addressing fundamentally different political, economic and ideological contexts and their juxtaposition in this way is an artifact of modern text selection. Moreover, both Hobbes and Rousseau are fundamentally pessimistic writers writing in the social contract tradition, albeit ones with different takes on authority: with Hobbes the authoritarian and Rousseu a sort-of proto-libertarian. Graeber & Wengrow ignore both the more optimistic left-liberal and materialist traditions and the reactionary critique of social-contract theory which sees inequality as a good and natural thing, actually.

A new pre-history of humanity

The other bit of false advertising on the book cover concerns its temporal scope: this is very much a book about ‘pre-history’ - the latest Eurasian civilizations we meet are the Minoan and Mycenaean Greeks, where conventional Western narrative history often begins. Perhaps that’s an intentional choice - after all, human history is much, much longer than recorded in writing. The insights and perspectives that these ancient societies can generate based on scant archaeological evidence are fascinating and represent the best parts of the book. We range all across north and south America, the ancient Middle East and into Eurasia and the Pacific, and while I have absolutely no doubt that Graeber & Wengrow are presenting the absolute cutting-edge in what is known about these societies, facts about them remain frustratingly just out of reach and many of Graeber & Wengrow’s implications are therefore necessary speculative.

At the outset, Graeber & Wengrow offer a convincing narrative about the origins of the inequality question in the European encounter with indigenous America. In this reading, Montesquieu, Voltaire and Rousseau did not invent the inequality discourse out of whole cloth, but instead were reflecting upon the perspective that native peoples had of European civilization - perspectives that were, as a result of French colonial empire, now available to bourgeois writers in the metropole. This isn’t quite right - French liberals had plenty of sixteenth-century sources about social contract theory, liberty and equality in both French and English to draw upon. But the Colombian exchange did pose the question of what rights human beings might have simply a consequence of being human - rather than as royal subjects or Christians. And thus, we are told, Rousseau and his contemporaries invented the concept of the state of nature by taking the ‘primitive’ but ‘egalitarian’ lifestyles of the ‘American’ foraging societies they were familiar with as representative. As we learn much later in the book, however, even those north American social bands which most approximated this ideal had adopted this way of life following previous periods of more centralised state-building - their relative egalitarian social structures were a choice, not merely a consequence of ‘underdevelopment’.

Graeber & Wengrow devote considerable space to advocating for a more fluid view of human social arrangements. Social structures are not fixed by material conditions, made irrevocable once a certain technological threshold. Rather, they note, many early societies adopted different modes of organisation at different times of year, coming together for hunts or festivals, and then dispersing, with very different social rules and hierarchies applying in each mode. A ‘king’ may have both the ceremonial and literal power of life and death at certain times of year, or in certain locations, but then be treated little better than an ordinary band-member on the hunt. Farming was not invented all at once, requiring investment in fixed townships, but societies used it from time-to-time as convenient, and abandoned farming just as easily as they invented it. Some hunter-gathering societies are rigidly egalitarian, others fiercely hierarchical. Egalitarian bands may enforce rigid material redistribution, with social rules to punish accumulation, while others encourage creativity and individuality within a materially poor culture.

Graeber & Wengrow also introduce the idea of cultural ‘schismogenesis’, the notion that neighbouring cultures may consciously adopt polarised social practices to create an exclusive sense of identity. In fact, they note that for most of human history, identity groups got smaller rather than larger, with tribes and villages adopting ever-more exclusive notions of group membership and curtailing the previous ‘freedom to roam’ enjoyed by ancient human populations. Examples include the ancient peoples of the California coast, who in the south enforced a rigid culture based on individual industriousness, and in the north fought and took slaves, who did the majority of the manual labour to support an indulgent ruling class. Graeber & Wengrow examine but ultimately dismiss the traditional materialist account of these different social modes, based on different ‘modes of production’ and the availability of surpluses in each ecological zone. Instead, they argue, these differences were a result of self-conscious self-differentiation against the ‘other’.

In short, there was nothing inevitable or pre-determined about the transition from hunter-gather societies, into agriculturally based city societies and the emergence of priestly and ruling classes based on the exploitation of these surpluses. Graeber & Wengrow marshall truly impressive evidence about the first cities, pre-dating those in Mesopotamia and Egypt by thousands of years, to show that massive groups of people - numbering in the tens or hundreds of thousands - could organise themselves quasi-democratically and without leaving any evidence of social hierarchies over timescales of many hundreds of years. While everyone knows Tenochtitlan, capital of the ‘blood-thirsy’ Aztecs, few know the name of Teotihuacan, a city of 125,000 people organised on egalitarian lines merely 40kms away that flourished over a thousand years prior with pyramid-building just as, if not moreso, impressive. Graeber & Wengrow present documentary evidence to show that Europeans exploring the Americans fundamentally misunderstood that many of the cities they encountered were governed as republics, with rhetorical and political traditions vastly more sophisticated than were practiced in Europe at the time. Their evidence is very clear that warrior aristocracies usually tended to arise in frontier zones - forests, mountains and hills - and only move into cities later as conquerors. And just as importantly, the archaeological records show hints of the first revolutions against tyranny, thousands of years before Rome and the Gracchi.

Against the evolutionists

All well and good. But apart from their [understandable but irritating] abuse of European philosophy as a framing device, Graeber & Wengrow also take aim at another subject close to my heart by being highly critical of what they call social ‘evolutionism’. For Graeber & Wengrow, social evolutionary theory is synonymous with a certain late-nineteenth century, ‘progressive’ view of human societies as inexorably and inevitably moving through a series of fixed stages towards the capitalist mode of development. They note that almost the entire field of sociology - from the Marxist to Hayekian - rejects this kind of simplification entirely, yet Graeber & Wengrow continue to argue against it, arguing that it reflects what sociologists ‘really think’. While that may be right in some sense - people to love their simplifying categories after all, even bespectled academics - employing such crude caricatures a great disservice to cultural evolutionary theory.

Because, in fact, the kind of diversity and experimentation that Graeber & Wengrow identify is precisely the variation that a modern evolutionary perspective would expect to see in human history. What is missing entirely from Graeber’s account is the function of selectors in history - what makes these societies fail. We are told repeatedly that once-glorious cities are abandoned, and people move away. But why? We never know, and Graeber & Wengrow make scant mention of the role of war, disease and environmental change in history. It’s frustrating that in discussing the origin of the state, the role of war and war-making is barely mentioned. Perhaps the emergence of the state in the seemingly mono-typical form we know it today is precisely the consequence of these selective pressures being applied on an initially more diverse population. A true history of humanity would need to account for the emergence of the capitalist nation-state as a consequence of the large-scale European warfare and brutal colonial extraction of the seventeenth and eighteenth centuries.

For Graeber & Wengrow, social arrangements always come back to a matter of ‘choice’ - not just individual choice per se, but the social choice of groups over time. Frustratingly, we are given no information, or even a theory, about how such choices might be made an implemented; given Graeber’s anarchist background, there’s a sort of perpetual wink-and-a-nod towards idea of community autonomy and self-governance. While the notion of social outcomes as social choices is certainly useful from a critical activitist perspective - it allows us to argue that another world is possible - it is not materially grounded. For Graeber & Wengrow, equality is an idea that we must choose. They do not, and cannot, engage from this perspective  in this with well-established liberal problems such as a nature of regime legitimacy, conflicts between the choices of the past and the desire of the current generation, and our fundamental lack of choice about the kind of society we are born into with limited ability to change.

A recommendation, with caution

Did I enjoy ‘The Dawn of Everything’? Yes. Did I learn things about human deep history from it, that I have not read elsewhere? Once again, yes. But am I persuaded that Graeber & Wengrow have genuinely offered a new ‘history [or even, gasp, a theory] of humanity’ that fundamentally challenges the staid and false dichotomy of Hobbes vs Rousseau? No. Unfortunately not. Like ‘Debt: the first 5,000 years’ or ‘Bullshit Jobs’, ‘The Dawn of Everything’ is full of interesting ideas that do not come together a cohesive whole, and which may one day be picked apart by serious academic critique. But for an undergraduate encountering these ideas for the first time, it offers a useful and engaging corrective to hundreds of years of propaganda that the inequality we see around us is somehow either natural or inevitable.  

A Reading Guide to Piketty's "Capital and Ideology" (Part 1): Introduction, Overview and Impressions

“Capital and Ideology” (2020) is the long-awaited sequel to French economist Thomas Piketty’s 2013 opus, “Capital in the Twenty-First Century”. Whereas the first volume was a fairly dry text, heavily informed by Piketty’s lifetime of data collection and research on the true extent and causes of economic inequality, this second volume aspires to something more like history, sociology or even political philosophy. Piketty is a polymath and, for better and worse, he has opinions on everything and wants to share them with you. Nevertheless, this is another 1,000+ page tome, so to save y’all the trouble of reading it I’ve attempted to distill the key lessons of each part of the book into this five-part reading guide, which I’ll be posting weekly over the course of March 2021. Today’s blog will provide a general review and introduction to Piketty’s core arguments.

When I began this project, I wanted to take the time and give “Capital and Ideology” proper consideration. Piketty is a serious contributor to economic policy debates, with robust data backing him up and a strong, central message. He was an invaluable influence on my thinking when I was writing my first book, “Politics for the New Dark Age: Staying Positive Amidst Disorder”, and the role of ideology in social order is a foundational leftist question. I regret to report, however, that “Capital and Ideology” does not reach the same heights as its predecessor. A much shorter book [300 pages] making the same arguments would not have gone unnoticed in the broader left-utopian publishing sphere - there’s genuine insights in the text that are worth engaging with. But as an editor myself, let me just say this book is many hundreds of pages too long - there are very many lengthy digressions and repetitive historical examples that add little of value. It’s too long for a polemic and too disorganised to treat as a a serious work of scholarship.

Theodicy and the construction of inequality regimes

I’ve noted before on this blog that liberalism has a theodicy problem: if all men [sic] are created equal, then why is inequality everywhere? Piketty’s book, if it had to be summed up as addressing one central problem, generalises this observation to construct a theory of inequality regimes. Here, ‘regime’ is being used in the same sense as in my second book, a social order that proscribes a specified set of benefits to a specified set of beneficiaries. Inequality is everywhere, Piketty begins, so “every human society must justify its inequalities". Inequality regimes are ideologies that legitimise the inequality that exists in the material world, and upon the basis of which people develop rules, norms and institutions that make sense of their social order.

“[Every] inequality regime is associated with a corresponding theory of justice. Inequalities need to be justified; they must rest on a plausible, coherent vision of an ideal political and social organisation. Every society therefore needs to answer a series of conceptual and practical questions about the boundaries of the community [the political regime], the organisation of property relations [the property regime], access to education [the education regime] and the apportionment of taxes [the fiscal regime].“

Note that the ‘truth-value’ or hegemonic nature of any given inequality regime is irrelevant; every justification of inequality “contains its share of truth and exaggeration, boldness and cowardice, idealism and self-interest”. What matters is whether a regime successfully legitimises and stabilises a particular social order - at least for a little while. Piketty is not explicit in doing so, but his approach to ideology fits [as mine does] within the broader field of Cultural Evolutionary Studies. For Piketty, ideologies are in constant dialogue with the need to solve social problems, and evolve and change overtime in haphazard and uncontrolled ways until they are replaced by something more fit. Piketty’s historical method is admirably historically contingent - ideologies are experiments enacted by stressed politicians and bureaucrats in times of crisis who often have little sense of the social changes they’re making.

“Each nation’s political and ideological trajectory can be seen as a vast process of collective learning and historical experimentation. Conflict is inherent in this process because different social and political groups have not only different interests and aspirations but also different memories. Hence they interpret past events differently and draw different implications regarding the future.”

Nevertheless, the book would have benefitted from a more serious engagement with evolutionary sociological literature. This is something of a theme in Piketty’s work - he’s more likely to invent his own term or concept than engage in debates with existing academic disciplines.

What kind of leftist is Piketty anyway?

For Piketty, inequality is neither economic nor technological - it is political and ideological, the result of conscious and unconscious social choices which are enacted by people and could have been enacted differently. The inequalities that exist today (which, Piketty’s data constantly reminds us, is worse today that at any time since the Gilded Age) and the institutions that maintain it are not the only ones possible - change is permanent and inevitable, and we do not live in the best of all possible worlds. It bears mentioning here that both orthodox Marxists [e.g. Gramsci] and leftists working in the broader Marxian tradition [e.g. Habermas etc.] have already problematised the classical deterministic understanding of the relationship between economic base and ideological superstructure. Dialectical materialism, correctly understood, is a philosophical practice that emphasises social change as a process, a dynamic, and a movement.

Nevertheless, Piketty himself is often contemptuous when writing about mainstream socialism, and treats Marxism as synonymous with narrow economism - in which the structure of society is purely materalistic, deterministic and decidedly Newtonian in outlook and character. This may be something of straw man, but Piketty himself sometimes hints that he’s veering in precisely the opposite direction. The ideological sphere is “truly autonomous”, we are told and “given an economy and a set of productive forces at a certain stage of development, a range of possible ideological, political and inequality regimes always exist". The truth lies somewhere between these two strawmen - some ideological variation is always possible, but which variations are stable is a question that only a dialectical or evolutionary sociology can tell us. Piketty is too sensible to outright endorse pure idealism, and the vast bulk of the text is finely graduated story of the historical contingencies and accidents that led to the emergence of each inequality regime in each particular time and place. But a strain of idealism underpins both his analysis and the kinds of solutions he thinks should be pursued, as if solving the greatest social, economic and political questions of our age were just a matter of finding the right policy mix.

Despite the sheer radicalism of Piketty’s policy proposals, the book itself embodies an almost instinctual dismissal of revolutionary change. Piketty, a tenured economic professor at one of France’s most prestigious institutions of learning, disdains the so-called populist left, most varieties of localism and mass movements in general. As a confirmed liberal of the self-described Rawlsian variety, his eyes are fixed firmly on the multinational and institutional - good policy is an end result of good institutional design. No one should have any doubts about Piketty’s genuine commitment to popular democracy or to a radical redistribution of wealth but like most utopians he’s unwilling or unable to outright acknowledge that the true barrier to the kind of reform he wants isn’t bad ideas or bad values but the entrenched social power of institutions with vastly more social and political influence than any reformer.

So what *does* Piketty want to do about all this inequality?

Like any good utopian book, “Capital and Ideology” is replete with ideas and schemes to remedy the injustices and inequalities it identifies. Piketty describes his outlook as ‘participatory socialism’ and he’s more or less explicit that this is little more than re-branding of the currently de rigueur current of democratic socialism. In this sense, in policy terms it’s not too different from the sorts of proposals you’d hear from Paul Mason, Rutger Bremen, Stephanie Kelton, or even myself - though I will give Piketty credit for dreaming big. The core element of Piketty’s programme are social and temporary ownership of the means of production, an universal capital endowment [universal basic inheritance], strongly progressive taxes on property, inheritance and income, educational justice and more participatory democracy.

I’ll say a few things about these specific programs in a moment, but the details aren’t really that important. None have any chance of being implemented, nor does Piketty offer even the hints of a work program that would bring them closer to fruition. Like a disaster capitalist, Piketty is putting his plans on a shelf in the hope that they’ll be be dusted off by harried bureaucrats the next time a crisis rolls around. But from the perspective of the middle stages of the worst economic crises in a century caused by the COVID-19 pandemic, it’s clear that no one with real power is reading “Capital and Ideology” in search of a way out.

Co-determination in workplace management - a corporate structure whereby workers in a firm have a permanent right to representation on management boards - is of course an idea that is long overdue. It’s proved highly successful in those countries that have adopted it, and democracy at work has been a core demand of socialists for a hundred years. Piketty also remains a strong advocate of a hefty wealth tax, on all forms of capital (not just real property), that would return 1 per cent or more of capital wealth to society each year and act as a strong incentive against hoarding. His central concept, ‘temporary ownership’, aims to emphasise that ownership is not seen as exclusive and legitimate right of any one individual, but rather as a stewardship of a society’s surplus value on behalf of future generations. In fact, Piketty’s full-throated embrace of heavily progressive taxes on almost all forms of wealth and income is fucking admirable in this day and age. One of the core things a wealth tax would fund would be a universal capital endowment [a sort of universal basic inheritance] for all citizens, a sort of permanent land reform or rolling libertarian ‘year zero’. Although as Piketty points out later on educational justice means that most states could also spend about the same order of magnitude educating a child from birth through to tertiary degree, so the question of how best to allocate that inheritance, I think, remains an open one.

So, what’s next?

There are good ideas in “Capital and Ideology” - the concept of inequality regimes, the ‘Brahmin Left’, ‘propertarianism’, trifunctional societies etc. - that will be picked up and discussed for years to come, but you shouldn’t have to slog through 1040 pages just to get to the good stuff. So I’ve done that for you! Future parts of this reading guide will be published weekly, every Monday. Links to each part are provided below for future reference:

Part 2: The French Revolution and Propertarian Liberalism [published 8 March]

Part 3: Liberal Imperialism and the Globalisation of Inequality [published 15 March]

Part 4: The Great Transformation, or How to Destroy Capital in Three Easy Steps [published 22 March]

Part 5: The Brahmin Left and the Nazbol Vortex [published 29 March]

Review: "The Ministry for the Future" by Kim Stanley Robinson

This is my first fiction book review for this blog, and fittingly enough it’s the new book by Kim Stanley Robinson, “The Ministry for the Future”. It would be fair to say that Robinson’s works - especially the Mars Trilogy and the earlier Three Californias trilogy - had a formative effect on me and my politics growing up. In recognition of his influence, the epigraph of my second book, “Evolutionary Politics: Socialism for Social Species”, is a quote by Robinson. That said, I absolutely loathed his last novel, “Red Moon” (2018) - which was not a very good book about China, nor a good book about the moon, nor a good book about a revolution. I am pleased to report, however, that “Ministry for the Future” is a return to form: well written, hopeful, and grounded - if not without its own flaws.

Whereas “Red Moon” was something of a narrative divergence for Robinson, focusing on two [intensely unlikeable] characters who were little more than bystanders to great events, “Ministry for the Future” takes the opposite approach: it’s a loose, almost epistolary, alternative future about how the world was saved from climate change. Its main character - Mary Murphy, an ex-Irish Foreign Minister tapped to head a new UN agency set up to save the world - is almost a stock liberal archetype, but over the course of the book’s 560 pages Robinson paints an affecting portrait of her as a human being. There are other characters who pop in and out of the narrative, but the bulk of the novel mixes lectures, short stories, records of meetings and tone poems to such a degree that it reads more as literature than genre fiction.

“Ministry for the Future” owes a lot to Robinson’s earlier works. Certain plot devices are events are so similar to those in “Red Moon” that a few times I thought they were taking place in the same universe. The influence of Robinson’s Antarctica novels is clear, as are the democratic and utopian politics of the Mars trilogy. Thematically, this book is closest to “2312” - whereas in that book, the climate apocalypse had already happened, in this one we’re to learn how it might be prevented. But for me, in style and composition “Ministry for the Future” is closest to perhaps my favourite of Robinson’s standalone novels, “The Years of Rice and Salt” - his alternative history of a world without Europe. Robinson loves writing about non-Anglo-Saxon cultures, and while “Ministry for the Future” is overloaded with reverence for the Swiss [a portrait that, as someone who’s lived in Switzerland, I find a tad obsequious], like “Year of Rice and Salt” it’s the Indians who by-and-large save the world.

An airport book for the Davos set

Robinson is often hard to pin down politically. His writing often reveals a strongly anti-capitalist bent, albeit shot through with a dose of California Ideology techno-libertarianism and environmentalism. “Ministry for the Future” is about a revolution - the revolution necessary to save the world from climate apocalypse - but a revolution that is gradual, incrementalist and implemented by international institutions, banks and scientists. The liberal elite, in other words. This is a book that Ezra Klein would love, and which that seems written specifically with that audience in mind. Realist but progressive. Intriguingly, though, a core component of the transformation this book imagines is brought about by terror - by terrorist groups, and [spoilers] by state terror conducted by the Ministry itself - but we learn almost nothing about this shadowy war taking place in the background of the story.

The politics of the book are also very contemporary - targeting the interests and prejudices makers of policy-makers here in 2020. Its timeline is often hazy - Robinson often describes issues and events that are supposed to be happening decades in the future in terms indistinguishable from what’s happening now. In terms of his socio-economic solutions, Robinson is also very of the moment: digital currencies and blockchain feature heavily - as they did, unfortunately, in “Red Moon” - as does MMT. In large part, it’s ‘carbon quantitative easing’ that prevents climate change, the creation by central banks of digital ‘carbon coins’ that replace the world’s major currencies. The book is almost a paeon to central bankers, mirroring the obsessive search by some on the left for a magic policy solution that can be designed, implemented and measured by technocrats.

Socialism: Utopian and Science Fiction

Big moments in “Ministry for the Future”, the inflection points that shift the course of history away from disaster, take place in board rooms in Switzerland and Silicon Valley. Change happens when well-meaning bureaucrats deliver knock-out powerpoint presentations for an audience of other bureaucrats. A large amount of the first half of the book takes place over ridiculously priced cocktails in Swiss bars [accurate]. In other words, this is book explicitly in the Utopian - rather than Marxist - socialist tradition. If Robinson’s aversion to discussing revolutionary violence doesn’t give it away, Charles Fourier is explicitly name checked in the latter parts of the book. Power doesn’t drive history - ideas do. And in this sort of world the best ideas from all cultures and places rise to the top to build the global hegemony of the future.

Chapter 99 is worth discussing in detail because it lays the thesis statement of this book out in detail. In fact, I wouldn’t be surprised if Chapter 99 was the first chapter Robinson wrote, reading as it does like an author exercise. The book - without putting these words in the voice of any particular character - rejects the idea that there are “totalizing solutions” to the world’s problems. There are no single solutions adequate to the task - success is made from failures, “the cobbling together from less-than-satisfactory parts. a slurry, a broclage. An unholy mess.” People working together to solve the same problems fight with one another, not because their values are mutually unintelligible, but because of the “narcissism of small differences”. Revolutions are "invisible, technical, legal” - one can have the benefits of revolution without actually going through one. Power is an illusion - but laws are everything.

This is not a capitalist realist book - Robinson does envisage the end of capitalism, and he does it better than anyone else writing today. But it is a sober, realist take. Some reviews describe it as hard science fiction but this book - like the Mars trilogy before it - is more sociological than that. It’s for that reason that I’m hankering for Robinson to write a book about political violence. Hell, write a sequel to this book that tells the story of the Ministry’s black ops wing - show us what it means to blow up aircraft, assassinate the heads of corporations and steal the wealth of billionaires. Robinson’s eco-socialist utopia is incomplete because he hand waves all that away - even while acknowledging that it’s necessary [in the world of the book] to get the outcome ultimately arrived at.

Recommended Reading

In the end, I offer “Ministry for the Future” a strong recommendation. If you’re a young reader, the same age I was when first reading Robinson’s works, it’s a great introduction to post-capitalist ideas. If you’re a contemporary of mine, someone who works in government and finance and still dreams of saving the world, then this is also the book for you. But if you’ve already been radicalised - either by Robinson’s earlier works, by any serious reading of left-wing theory, or by the sheer reality of living in 2020 - then the politics of the “Ministry for the Future” will have little to teach you. It’s stunningly well written, and surprisingly affecting. Robinson has a lot of say about life, death, the planet and what it all means. He’s written the most optimistic vision of the contemporary world he could have. What does it say that I’m still unconvinced anything will change for the better?

Review: "People Without Power" a.k.a. "The People, No" by Thomas Frank

There are three essential traits I look for in a political book: the author must choose interesting subject matter; they must present a coherent theory of events; and they must write clearly and succinctly in support of their narrative. Thomas Frank’s new book, “People Without Power: The War on Populism and the Fight for Democracy” - or as it is known in the US market, “The People, No” - is a hit on all three fronts. Rarely do I encounter progressive tracts that I enjoy reading as much as I enjoyed this book.

I have a semi-regular series on my blog I call “Myths of the Old Order”, where I take aim at one of the cherished myths of liberal ideology and examine how liberalism’s failures have exposed the tenuous underpinnings of the old order. Frank - previously famous for his cutting and insightful work in “What’s the Matter with Kansas?” and “Listen, Liberal!” - performs a similar task in taking aim at the myth of “populism”: “Populism is the word that comes to the lips of the respected and the highly educated when they see the global order going haywire . . .the political face-off of today . . .pits the center against the periphery, the competent insider against the disgruntled”. We might also call this out as radical centrism, or horseshoe theory-as-praxis. Frank calls it the ‘Democracy Scare’. In the writings of think tanks and government agencies, in the books of centre-rightists like William Galston or centre-leftists like Yasha Mounk, democracy is supposedly under threat from authoritarians and extremists on both the left and right that share more in common with one another than either does with the sensible centre.

In response, Frank has written a history of ‘actual existing populism’ to show that left-wing populism is nothing like the centrist caricature. But he has also written a matching history of ‘anti-populism’ - how the rhetoric and tropes of the ‘Democracy Scare’ have evolved, and remained the same, throughout recent history and how the liberal sneering of today against the likes of Bernie Sanders and Jeremy Corbyn is in truth little removed from the reactionary ravings against FDR’s New Deal. Frank is able to tackle this daunting task because he has the most sophisticated analysis of what elites mean when they say ‘democracy’ that I’ve encountered outside a graduate-level classroom. Elites don’t really believe in democracy as it is popularly or even philosophically understood: the notion that individuals should have a say in decisions that might affect their rights and legitimate interests. Instead, elites operate under a consensus model of governance or what Galston (and Frank) call ‘pluralistic democracy’ - in which elites representing diverse constituencies meet in closed rooms to hash out solutions that serve the interests of the communities those elites supposedly represent. Barack Obama, famously, holds to this vision of liberal undemocracy, as does the NGO industrial complex. But what it amounts to, whether in the 19th century or the 21st, is a vision of society in which the majority of the population is deemed unfit to govern themselves.

Agrarian Populism

The core of Frank’s thesis is an in-depth account of the US People’s Party of the late 19th-century - the movement that was the first to explicitly call itself populist and the only indigenous American political movement to be praised by the first general of European communists. Frank demonstrates how - contrary to the assessment of later historiography - the first populists represented a multi-racial, working-class movement overwhelmingly focused on collective solutions to questions of economic justice. The People’s Party prospered when it teamed up with local political institutions (Democrats in most states, Republicans in others) to overthrow the status quo, but failed when it threw its weight behind the national Democratic Party (in the personage if Williams Jenning Bryant) and when it was culturally wedged on the grounds of race and culture. Frank notes that most of the macroeconomic principles the centre now takes for granted - the welfare state, fiat currency and free trade - were originally the ‘fringe’ ideas of radicals, and that there was nothing reactionary or anti-scientific about the first Populists - quite the contrary. Populists believed then and believe now - contrary to the self-congratulatory smugness of elites - that ordinary men and women are more than capable of governing themselves.

Frank matches his history of the People’s Party with an equally incisive account of the first wave of anti-populism, told largely through the story of the US presidential election of 1892 and the machinations of one Mark Hanna, campaign manager of the genteel Gilded Age president William McKinley. Hanna, the political hero of modern day conservative propagandists such as Karl Rove, invented the myth of populism out of almost whole cloth: that populists were ‘lunatics in rag’, that they posed a threat to democracy and rule of law, motivated by demogoguery and jealousy of the wealthy rather than a sober assessment of their real material conditions and those responsible for it. Frank points out that almost all of the tropes of modern anti-populism can be traced back in their genealogy to the mad hysteria of Gilded Age elites - with one notable exception. And that is that early anti-populisms did not accuse their opponents of racism (and anti-semitism), misogyny and xenophobia (if only because the establishment of the time was thoroughly soaking in such beliefs itself). That element, so common in anti-populist rhetoric now, came much later.

Rise of the PMC

The remainder of Frank’s history examines the recurrence of these patterns from the 1890s in three subsequent historical eras: the triumph of social-democratic populism in FDR’s New Deal, largely told through the story of FDR’s triumph in the presidential election of 1936; the ‘New Left’ era of the 1960s and the catastrophic failure of George McGovern, and finally the conservative counter-revolution represented by Ronald Reagan and Donald Trump. The key question Frank asks us to consider is how the populist triumphs of the New Deal gave way to an era in which anti-populism came to be seen as a not a fringe reactionary opinion, but a mainstream centre-left belief, and how latter-day conservatives came to portray themselves as populist insurgents against a corrupt liberal establishment.

This, sadly, is well-trodden ground for the contemporary left. The New Deal era was so successful that it produced a generation of administrators who believed that political problems were essentially technical in nature; a protest culture among students which came to see academic credentials and schooling (something inaccessible to their own parents) as granting moral virtue; and a union movement that was focused above all on defending the gains of the 1930s, even if it meant selling out their radical comrades at every opportunity. The self-satisfied Keynesian consensus of the 1950s and 60s was the first time that elites could claim to have ended history - and the first time that their abject failure to deal with overlapping economic and social crisis led to their ideology being completely discredited. The 2010s are in some respect, merely a neoliberal echo of this earlier failure; Trumpism a farcical repetition of the Reagan Revolution.

As early as the 1950s, the imagined opponent of this liberal consensus was the conservative firebrands exemplified by McCarthy and Goldwater. Their crusades against the liberal establishment failed, only to be picked up in later generations. But how the centre-left translated anti-populism into opposition to their own left flank [which had defended them again McCarthy and Goldwater] is the central mystery of the twentieth century: how did well-meaning technocrats “retrieve pieces of long-forgotten conservative stereotype, fit them out with fashionable academic jargon of their era, and launch the result as a shiny new diagnosis handed down by the well-adjusted administrative mind”? Franks blames particular academics and writers - Daniel Bell, Richard Hofstader, Michael Rogin, Edward Shils and Seymour Lipset - but these men were representative of a particular materialist transformation: the rising influence of the professional-managerial class. These elitist academics from Ivy League institutions only had influence because a generation of social movement and union leaders had come to believe in the moral value of their credentials - the same credentials that gave them, as children of the working class, access to the halls of economic and political power.

The Disciplining of the Working Class

Thomas Frank has once again written an important book, that leftists everywhere should read in order or understand the moment in which they live. The increasing movement towards managerial liberalism on the liberal lift - the idea that the working class (who are inherently racist, misogynist and xenophobia) need to be educated and disciplined by their social betters - is a political disaster in waiting. Social democratic parties that have embraced the sensibility of liberal undemocracy have seen their vote whither and their popular support die. On the contrary, right-wing populists have once again discovered that elites will tolerate proletarian manners so long as the give capital complete freedom of action. This is a uniquely dangerous moment for liberalism - it has rarely been as a weak as it is right now. Socialists are once again called upon to defend the liberal order against itself. Because liberals no longer have the good sense to recognise that popular democracy provides the legitimacy that keeps their social order running.

Review: “The Deficit Myth” by Stephanie Kelton

Before getting into my review of Stephanie Kelton’s new bestseller, “The Deficit Myth: Modern Monetary Theory and How to Build a Better Economy”, it’s important to stipulate a few things. That the public discourse about debt and deficit in Western media, politics and academia is deeply, profoundly stupid. That advanced democracies - including Australia - face essentially no challenge to their ability to finance their fiscal deficits. That in the midst of what will no doubt be the opening stages of a second Great Depression, it’s inevitable that public debt should increase rapidly. And that the decision of the Australian federal Labor Party to launch a scare campaign against debt in the middle of a pandemic is at best questionable and at worst political malpractice. It is possible to believe all these things to be true, and remain strongly critical of Modern Monetary Theory (‘MMT’).

This Government wants to blame the debt on coronavirus – but this is their record.

And what have we got to show for it?

Insecure jobs. Flat wages. The price of everything going up – and an economy in recession for the first time in three decades. pic.twitter.com/GhgFnKY3V3

— Anthony Albanese (@AlboMP) July 27, 2020

Deficit hawks - economists, journalists and politicians - who wring their hand at the size of government deficits are not now, nor have they ever, acted in good faith. It’s a right-wing propaganda exercise that has been so successful as to dominate the strategic imagination of almost all modern political leaders. Professor Kelton is quite right when she points out that the legal and budgetary manifestations of this ideology - debt ceilings, pay-as-you-go rules, efficiency dividends etc. - are arbitrary procedural constraints on our ability to build a better, more just world. But here’s the obvious question raised by Kelton’s career: is MMT also an exercise in propaganda? Do she and her colleagues genuinely believe that it’s only “bad reasoning [that’s] led to bad policy” and that MMT worldview will improve the quality of government decision-making? Or will her legacy be that of a highly effective communicator and propagandist? In the end, does it matter is MMT is true if it succeeds in demolishing ‘The Deficit Myth’ and encouraging political leaders and activists to ask more from their government?

Kelton is an effective and persuasive writer, and she’s written a popular and accessible introduction to MMT. The first four chapters of her book, outlining some of the key ideas of the MMT theory (that is: chartalism, a jobs guarantee, monetary financing and sectoral accounting) are succint, witty, well-argued and powerful. Kelton is also direct and up front in tackling some of the most common criticisms of MMT. Unfortunately, the back half of the book fares less well - it’s more-or-less a shopping list of ‘wouldn’t it be nice’ progressive policies that anyone who’s read a popular left-wing book in the last ten years (by Paul Mason, Rutger Bremen, Naomi Klein or the like - hell, even my first book) will be familiar with. Isn’t climate change terrible? Isn’t inequality bad? Shouldn’t someone do something about declining access to health, jobs and education? The limits of Kelton’s brand of politics are here on full display - as a former Democratic Party staffer, the last four chapters are as dry as you’d expect a staffer’s policy wish list to be. The book is similarly peppered with personal anecdotes and touching stories about the ordinary people she’s met outside Washington in the Real World(TM) - persuasive to the cocktail set, maybe, but not a manifesto for political revolution.

An Economist of Bravery & Renown

Kelton begins her book by tackling the conventional story about how governments fund their activities. Modern governments traditionally raise revenue in one of two ways - they either tax or borrow from the private sector. Kelton builds this picture into something of a straw man before commencing her attack upon it - that the government must raise revenue before it spends [i.e. a government can’t spend a dollar it doesn’t have]. Kelton made her bones as an economist by demonstrating that this isn’t accurate (you can read Nathan Tankus’ restatement of this article in a recent blog post here). The short version is that the Treasury can spend whatever it wants, whenever it wants, and Central Banks adjust the monetary reserves held by financial institutions to ensure that private savers can lend funds to the government. This is what MMT advocates mean when they say their theory is merely a description of the status quo: in their minds, government spending is already being financed by money creation - just with a few extra steps.

You can do several creative things with this insight. You can ignore the independent institutional existence of various government entities to claim that the Treasury and central bank are are single accounting entity, called the ‘federal government’, which creates money by spending it into existence. You can go down a chartalist rabbit-hole, arguing that the value of money is a result of demand for government-issued currency generated through taxation And, finally, you can argue that the middle men in the financial sector are unnecessary, and that the central bank’s ability to create money should just be plugged directly into the Treasury’s veins - monetarily financing government spending without deficits being covered by the issuance of government securities [i.e. bonds]. Kelton is upfront on a point that most MMT advocates - who are keen to downplay any radical implications of their theory - avoid: that is, that government’s choose to issue bonds to cover their debt, and could just as easily choose not to.

The Chartalism Fallacy and the Ontology of Money

I take issue with the Kelton’s account of money creation on several grounds. In the first instance, it’s misleading to claim that traditional budgeting says that governments can only spend dollars on hand: only that these accounts balance over an arbitrarily decided period of time. Tax revenue does not flow into government coffers evenly, and spending is spread out over the whole year. It’s just good financial practice to calculate all your incoming and outgoing, and identify any shortfalls. The decision of when the books must balance is arbitrary. Secondly, and perhaps more importantly, the value of money is not simply derived from its role in the payment of taxes. Money has value to consumers as a stable medium of exchange - destabilising expectations of stability could make prices and wages unpredictable. But beyond that, money has value as a standard of deferred payment - a way of measuring imbalances in the inter-temporal flows of currency. Treasury bonds have value because they’re a record of the government’s promise to one day balance its books.

Moreover, all those middle men and financiers that MMT dismisses - the bond purchasers, the secondary dealers and primary financial institutions - are not merely there to take a cut of government spending [although they do that too!]. They generate resistance in the system, ensuring the flow of currency into the real economy doesn’t exceed the capacity of the private sector to handle it. I like to think of the difference between traditional government financing and MMT as akin to the difference between AC and DC power. In both instances, the central bank is generating monetary reserves which supply the operations of the Treasury. But in the ‘AC’ system, the bank is adding and taking away a fraction of the bank reserves of private financial institutions every day [‘oscillating the money supply’], which is passed on to those bank’s institutional customers, which is passed on to lenders and savers and eventually to the government in the form of either taxes or loans. In the MMT ‘DC’ system, money would flow directly from the central bank to the Treasury - without the resistance and accountability provided by the financial sector and with no guarantee that the real economy can handle the volume of currency being delivered safely.

Kelton truthfully admits that chartalism could be exploited by political conservatives to argue for widespread tax cuts. She herself often seems skeptical of taxation (like her intellectual mentor, Warren Mosler), describing it at various times as a burden, and is half-hearted in her condemnation of Republican giveaways to the elite. She also deliberately distances herself from what she describes as the ‘Robin Hood’ policies of Bernie Sanders and Elizabeth Warren. Kelton does helpfully provides a list of reasons why taxes might be needed: for the government to requisition resources, to manage inflation, to engage in redistribution of wealth and income, and, as with the use of ‘sin taxes’, to control behaviour. One could argue that bonds have a similar set of purposes - for the government to requisition savings that aren’t being used, as a ‘sin tax’ on wealth that is not being productively invested, and as an equality-boosting measure to invest that capital for the benefit of those with the least access to it. And most importantly of all, to control inflation by removing liquidity from the private market in proportion to the liquidity injected by public spending.

In summary, then, MMT advocates a revolution in public finance. Either governments stop issuing bonds (and allow those already issued to be paid off gradually over time), or we anticipate that at some point in the future central banks will simply ‘delete’ their holdings of Treasury securities - a possibility that has already been floated by some as a response to massive balance sheets central banks have built up via quantitative easing. In some ways, this would be the ultimate debt ‘jubilee’ - governments unilaterally writing off their own prior promises to pay. But to destroy the bond market would be to un-moor a key tool of managing market interest rates and determining the value of country’s currency. Without information on market conditions, expectations of short and long run inflation could fluctuate wildly.

Despite its claims, MMT doesn’t end the debate over ‘how will we pay for it?’ - it simply resurrects a technique [monetary financing] that more conservative economists and politicians long assumed was anathema. To paraphrase Ian Malcolm, just because the government can do something, doesn’t meant it should.

The Last Word on Inflation?

Kelton’s chapter on inflation is appropriately cautious and realistic, given that inflation concerns are frequently levied by MMT critics. Conventional monetary theory predicts that monetary financing without debt issuance will increase inflation, outside of unusual economic conditions like demand shock we are currently living through. MMT advocates must tackle this topic head on, and Kelton does so by making the entirely valid point that no one, really, has any good idea of what causes inflation, and that the experts and institutions we rely on to manage inflation today have poor tools for the job. Shemakes the point that MMT only says that money is unlimited, not ‘real resources’, and that inflation can and will occur if government spending exceeds the capacity of the real economy to deliver goods and services. Fair enough [such a view is widespread among Keynesians], but if money quantises the power of currency users to call upon real resources, then expanding the money supply will also alter the capability of both public and private actors to access real resources - most likely reducing private purchasing power [i.e. causing inflation].

Kelton claims that inflation is only a risk when an economy is already operating at it’s ‘speed limit’, and that the existence of unemployment and other inefficiencies in the market economy suggests we are a long way from hitting this limit. I’ll address the unemployment question in the final part of this review, but Kelton goes on to claim that rather than worrying about debt and deficit (the measurable component of the currency flowing in and out of government) governments should concern themselves with balancing the supply and demand of real resources in the economy. Kelton’s vision is one of active and continuous tweaking of tax and spending levels to balance economic output and consumption, a herculean - perhaps utopian - and certainly politically impossible task. How these things are to be measured, and how governments should make policy under these conditions is anyone’s guess [MMT-er Brian Romanchuk labels this the ‘Noble Lie’ critique of MMT, and it’s also discussed in this review of Kelton’s book].

An economy’s ‘speed limit’, is in large part a function of the composition of its capital base, the skills and knowledge base of its workers, and its supply of natural resources and environmental goods. Moreover, these things are unevenly distributed between different geographical regions, across classes and among ethnic groups. It’s implausible that these things should be - or could be - meaningfully ’balanced’. The market will always be inefficient in some way or another, always operating at less than ‘full speed’ [in other words, structural unemployment is real] and to suggest that inflation is not a risk, or that it’s a risk that can be managed in a technocratic fashion, under these conditions seems positively Soviet in its ambition.

In the Dark Future of the 41st Millennium, there is only the Jobs Guarantee

It’s only towards the end of ‘The Deficit Myth’ that the beating technocratic heart of the MMT vision is on full display. Kelton knows and recognises that politicians who are barely able to make their accounts balance would never be able to make the finely-tuned tax and spending decisions necessary to regulate inflation in an unconstrained monetary environment. So in response she advocates taking policy-making out of the hand of legislators, of putting in place automatic spending programs - those designed by MMT economists, of course - that would algorithmically dispense funds and set taxation levels to ensure the economy was always running at ‘full speed’.

The MMT prescription for a jobs guarantee is emblematic of this way of designing public policy. Kelton argues, accurately I think, that central banks lack the conceptual and policy tools to fulfill their mandate of full employment, and instead set an arbitrary level of unemployment they judge ensures price stability. In the place of these technocrats, MMT argues, we should have an entirely different set of technocrats managing a universal jobs program, that would determine a minimum wage at which they would offer unlimited public jobs to anyone who wanted them with the objective of controlling inflation and maintaining full employment at all times. What these public jobs would entail is left largely unspecified and up to the reader’s imagination (but don’t worry, they’ll only be good, productive things, Kelton assures us!).

Kelton disavows the idea that a jobs guarantee would be a panacea for our economic and social ills, but she sure does come close to arguing that. Rather than acknowledge the democratic deficit that underlies the trade policies of modern capitalist states, and which have driven much of economic anxiety and dislocation that drove Brexit and the rise of Trump, Kelton merely promises us that a jobs guarantee would more than compensate for the losses of employment that follow trade liberalisation. Oh, and by the way, the job guarantee wage would be the minimum wage, competing directly with the most exploitative part of the labour market for workers while miraculously matching matching people with jobs that best suit their skills with zero friction.

As a leftist, I’m all for nationalising things in principle, but the jobs guarantee would represent nothing less than the nationalisation of the majority of the labour market. Which again, sounds very Soviet. Why any of this would be better than a guaranteed minimum income without any obligation to work is beyond me. In the last few days, MMT guru Bill Mitchell has become increasingly open about the authoritarian impulse that lies behind the jobs guarantee - but as Matt Breunig has helpfully pointed out over at the People’s Policy Project, the notion of replacing the current welfare system with a ‘duty to work’ has a deep roots among MMT advocates, including in Kelton’s own work. Maybe MMT is a fair and accurate description of how an economy that has solved the communist Calculation Problem could work [as one unfriendly review has pointed out, a recipe for permanent War Communism]. And in the meantime, if individuals have to put to work doing make-work tasks to ensure that the government ‘printing press’ doesn’t run the economy off the rails, well that’s just the price to pay for a rationally-organised economy.

Conclusion
Socialists agree with Kelton and the MMT crowd that government’s are neither good nor evil, and that distributional outcomes across the economy are what matters. So why then do we need MMT at all? Socialists have been arguing for social and economic redistribution for hundreds of years now. It’s hard, often brutal work that won’t be completed in our lifetimes. If the claim of MMT advocates like Kelton is that their theory will make winning redistribution easier, then they must also knowledge that it also makes life easier for the bad kind of government spending - enormous tax cuts, reckless foreign wars, insane subsidies for the already-well-off - and lays a rhetorical framework for the end of most tax-and-transfer programs as we know them. Ultimately, I think MMT has some value to the left as a rhetorical cudgel, to dispel the Deficit Myth once and for all. And in playing that role alone, Kelton’s success can be [carefully] applauded.