LUMPENPROLETARIAT—On today’s edition of free speech radio’s Against the Grain, American sociologist, and Professor of Sociology at the University of California-Davis, Dr. Fred L. Block discussed a new book he co-authored with Dr. Margaret Somers entitled The Power of Market Fundamentalism: Karl Polanyi’s Critique (2016).  This discussion coursed through the history of economic theory (or history of economic thought), which reflects the contending theoretical perspectives of neoclassical and heterodox economics.  In this two-part interview, Dr. Block agreed to focus on two historical episodes in economic history, or case studies, which reveal barbaric policy attitudes toward the impoverished segments of society.

On the neoclassical side (or right-wing side), economists, political scientists, and others, have argued for policy positions, which primarily favor the interests of capital, capitalists, financiers, investors, bankers, rentiers, and the like.  Conservative think tanks pursue neoclassical and right-wing policies, as they’ve done for centuries.  These policies are rationalised through the ideology of laissez faire capitalism, or free market capitalism, where the government is expected to let the economy be, to avoid intervening in the natural order of the economy, unless it’s to intervene to protect private property and the interests of the capitalist owners of the means of production, usually at the expense of the rest of society, of working people and the environment.

On the heterodox side, economists, sociologists, philosophers, and others, such as Dr. Karl Polanyi, have worked to reintroduce the human factor to the discipline of economics, or political economy.  The neoclassical approach to economics, in its evasion of human responsibility, works to remove the human context from economics and confine it to esoteric mathematics, calculus, and econometric analysis, which tends to reduce the economist to a sort of strange weatherman, whose primary role seems to be that of an oracle looking into a crystal ball and attempting to predict economic forecasts for the benefit of capital, not working people.  However, heterodox economists, whose field of study is interdisciplinary, are capable of (and interested in) analysing the broader economy and functioning as doctors of society, capable of describing socioeconomic ills and prescribing effective solutions.  Heterodox economists draw from fields as diverse as finance, sociology, agriculture, philosophy, economics, history, psychoanalysis, environmental studies, business, and so forth; such interdisciplinary economists seek to re-contextualise the study of economics within the reality of the human experience and with realistic underlying assumptions.

The bifurcation of the field of economics between neoclassical and heterodox (or pluralistic) economics across all economics departments is an unfortunate fact, which all students of economics (formal or informal) must learn, if they are to fully understand the study of economics.  Students need to know that there are more approaches to the study of economics than the neoclassical approach, with its unrealistic assumptions of supply-and-demand and natural, self-regulating markets.  Sadly, most economics courses only teach a neoclassical perspective of economics, which removes the social science aspects, emphasises the mathematical aspects, and adopts an ahistorical worldview.  Yet, historically, ruling class elites have sought to minimise, downplay, or omit alternative economic perspectives, which do not conform to the neoclassical agenda.  Ruling class elites have, instead, promoted economic perspectives, which privilege the power of capital over all other human concerns.  Indeed, ruling class elites, through dominance of economics curricula and mass media, have sought to distort public understanding of economic concepts to further their capitalist interests.  One example is the public discourse around the U.S. government budget, budget deficits, debt ceilings, fiscal insolvency, and so forth.  Heterodox economists and educators, such as Dr. L. Randall Wray and Dr. Stephanie Kelton, teach us (or remind us) through modern monetary theory (MMT, or modern money theory) that the USA, given its sovereign monetary system, can always afford to spend in its own sovereign currency and can never face fiscal insolvency, only real resource constraints. [1]  Yet, most economics departments and commentators featured in mass media perpetuate the myth that the US government ‘borrows dollars from China’ and may soon go broke.  Of course, we observe that calls for economic austerity are predominantly invoked against social spending, such as education, jobs, or health care, but never against anti-social spending, such as war, military invasions, occupations, imperialism, and corporate giveaways.  To quote 2Pac, they got money for wars, but can’t feed the poor.

In The Power of Market Fundamentalism: Karl Polanyi’s Critique (2016), Dr. Block and Dr. Somers shed light on this centuries-long battle of pro-capitalist versus pro-working class economic perspectives in academia, business, and civic engagement around economy policy decision-making.  This interesting Against the Grain interview, which traverses the history of economic theory (or history of economic thought), sheds light on the contending theoretical, or analytical, approaches to economic policies designed to address issues of poverty, particularly at pivotal points in the history of capitalism, such as the two historical case studies discussed here.  One is the late 18th century/early 19th century rise of the Industrial Revolution, which economically displaced vast segments of the population in England, for which the state responded with the harsh Poor Law Amendment Act of 1834, which cruelly reduced the centuries-long tradition of English poor relief.  The other is the late 20th century neoliberal anti-welfare legislation signed in 1996 by President Bill Clinton, which fulfilled his 1992 campaign promise to “end welfare as we have come to know it” by doing away with American poor relief policies instituted as part of the New Deal, which had responded to the extreme economic displacement caused by the crisis of capitalism known as the Great Depression.  In both cases, the structural causes of capitalist crises were ignored, excuses were made by the ruling class beneficiaries of capitalism, the victims of capitalism were unfairly blamed for their own poverty, and inhumane Malthusianism was invoked to rationalise the ethical validity of stripping away economic assistance for the poor.  Listen (and/or download) here (part one) [2] and here (part two) [3].

UPDATE—This two-part series has been rebroadcast in April of 2017. [4]

Messina

***

[Working draft transcript by Messina for Against the Grain and Lumpenproletariat. This draft is a composite of parts one and two of this two-part series.]

AGAINST THE GRAIN—[two-part series: 30 AUG 2016 & 6 SEP 2016]  [KPFA station identification by Erica Bridgeman(sp?)]

[Against the Grain theme music]

“Today on Against the Grain:  Where did they get this idea that political intervention to assist the poor is wrongheaded because society and markets are self-regulating and, so, should be left to themselves?

“I’m C.S. Soong.  Fred Block discusses the impact of Malthusian and other ideas on welfare policy in late 20th century U.S. and late 19th-century England, after these [KPFA News] Headlines.”

[KPFA News Headlines (read by Gabriela Castelan)(sp?) omitted by scribe]  (c. 5:50)

C.S. SOONG:  “From the studios of KPFA in Berkeley, California, this is Against the Grain on Pacifica Radio.  My name is C.S. Soong.

“Ideas can be powerful.  They can wield enormous power when taken up by elites and governments and makers of policy, that affect people, including marginalised and poor people.  That’s one of the fundamental lessons of a book called The Power of Market Fundamentalism, written by Fred Block and Margaret Somers.

“One set of ideas, the authors focus on, belong to Thomas Malthus, whose ideas of food scarcity and population growth spurred England to move from a system of poor relief to a much harsher, much more stingy regime.  According to Block and Somers, those Malthusian ideas played a prominent and insidious role in another country a century-and-a-half later, namely the U.S. in 1996 when [then-President] Bill Clinton signed into a law a bill, that dismantled the safety net, that was the federal welfare system for six decades.

“Fred Block is sociology professor at the University of California-Davis.  And his and Margaret Somers’ book is just out on paperback.  Its full title is The Power of Market Fundamentalism: Karl Ponalnyi’s Critique.

“When Fred Block joined me in our KPFA Berkeley studios, I asked him how he defined the term market fundamentalism.”  (c. 7:32)

DR. FRED L. BLOCK:  “It’s a term used to describe the same thing, that other people refer to as neoliberalism or the Washington Consensus or free market rhetoric.  We use the term precisely because of the fundamentalism part, because it evokes similarities to Christian fundamentalism and Islamic fundamentalism and Jewish fundamentalism and all the forms of religious fundamentalism, where people know what they know with enormous certainty.

“So, we’re arguing that the kind of free market ideas, that have dominated represent a kind of intellectual fundamentalism where the people who say

The market will solve our problems,

“that,

If we can only restrain the growth of the state and allow markets to self regulate…

“and,

Lower government regulation,

“and

Lower government taxes,

“and

Lower government provision of services to people,

“that

The market, this magnificent instrument for processing information and fitting supply with demand and so forth, that will solve all our problems,

“we consider that to be a fundamentalist doctrine because, as with religious fundamentalisms, it’s not based upon an empirical analysis, on science, or any of the kind of normal ways, in which we think people come to understand the world.  It’s base, as with the religious fundamentalisms, on belief, that people are convinced that the stories in the Bible are literally true.  And they choose to believe that and use that as a template for seeing everything else.

“So, our argument is that the Milton Friedmans, and their followers, advance this ideology so insistently are, really, immune to countervailing facts, countervailing theories, and so forth.  They believe what they believe.  And there’s kind of no way to get them off that.”  (c. 9:53)

C.S. SOONG:  “Market fundamentalism, you write, has become the dominant policy perspective across the global economy.  How quickly did it become so?  How many years or decades did this revival of market fundamentalism take?”

DR. FRED L. BLOCK:  “Well, the process really took off in the 1970s.  So, as a number of people have pointed out, the kind of core intellectual group, that advanced these ideas had begun meeting right after World War II.  They were called the Mont Pelerin Society, that Friedrich Hayak, the Austrian economist, who was one of the major figures in this movement, pulled together people from the U.S. and Europe.  And they started meeting.  But, through the ’40s, ’50s, and ’60s, and even halfway into the ’70s, they were pretty much marginal.  They had supporters among the very rich.  They ran some think tanks.  But their ideas weren’t in the center of political or economic debate.

“So, the turning point was in the 1970s, when we had stagflation.  And it was at that point that this kind of theoretical, intellectual revolution took place.  And the previous Keynesian understandings of how an economy worked were effectively overthrown, that within the economics profession in the United States, for example, the followers of Milton Friedman were considered to have successfully routed their Keynesian opponents.

“And, so, over the next few decades—the ’80s and ’90s—this set of doctrines intensified its effect—I mean became introduced into more and more realms of policy, into welfare policy, as we’ll talk about, into financial policy, into anti-trust policy—and, essentially, became the basis for the tax-cutting, the austerity policies, the opening up of markets, the trade agreements, the notorious trade agreements, and so on.”  (c. 12:17)

C.S. SOONG:  “So, the section of the book, The Power of Market Fundamentalism, that we’ve agreed to discuss in detail this hour, involves a comparison, a comparison of two episodes in history, two welfare revolutions—or maybe we could call them anti-welfare revolutions.

“One culminated in the 1996 U.S. federal law signed by Bill Clinton, that’s been called welfare reform (or welfare deform) by its opponents.  The object was to end welfare as we know it.  And Bill Clinton had made that part of his campaign promise.  And the other episode culminated in a law enacted in England long before, in 1834.  And this law overturned, or replaced, certain laws, that provided relief to the poor, to poor people, to needy people in England.

“What motivated you to compare these two historical episodes?”  (c. 13:19)

DR. FRED L. BLOCK:  “Well, the thing is that, when one’s doing this kind of historical comparative work, one really confronts the reality that—I think it was Mark Twain, who said—history doesn’t repeat itself, but sometimes it rhymes”.  I mean, at best, sometimes, you get parallels.

“But, when we started thinking about it and digging into it, this was a case where these two turning points, separated by 162 years, were remarkably similar in terms of the way in which the change happened, extremely similar in the ideological preparation.

“So, I guess that, uh, the key turning point for us was that we started reading very carefully the Essay On Population, that T. R. Malthus, the famous English scholar had published in 1798.  And it struck us that its whole argument was so remarkably similar to the extremely influential book, that Charles Murray published in the U.S. called Losing Ground, that was extremely influential in shaping the debate leading up to the 1996 legislation, that that parallel just hit us over the head.  And, then, we kind of saw the necessity of fleshing out how this strange historical similarity came about.  And I stress strange because, even though legislatively and as policies the similarities are enormously great, the context is just extremely different.  (c. 15:13)

“I mean in England in the first part of the 19th century, the welfare recipients were white people.  They were rural farm labourers and their families.  In the U.S. [in the late 20th century], the debate was about the population mostly of women, who were served by programme Aid to Families with Dependent Children [AFDC], where that group included many women of colour, African Americans, Latinos, and so forth.

“So, there was a huge change in the recipients of welfare, the type of aid, that they were getting.  But the larger political context of the debate was so remarkably similar.” [5]

C.S. SOONG:  “I’m C.S.  And this is Against the Grain on Pacifica Radio.  Fred Block joins me.  He’s Research Professor of Sociology at the University of California-Davis.  He’s co-author with Margaret Somers of The Power of Market Fundamentalism: Karl Polanyi’s Critique.  It’s now out on in paperback from Harvard University Press.  (c. 16:20)

“So, I want to talk about in some detail the essay by Malthus, that you just referred to, and the essay by Charles Murray. in the U.S. more than—what is it? I believe it was—50 years later.

“But let’s talk about England before the drive to get rid of the—what were called or what are called the—old poor laws began.  So, let’s say pre-1800, what was the nature of the welfare system in England?  And to what degree were the poor given relief, given assistance by the government?”

DR. FRED L. BLOCK:  “Well, we generally think of welfare and welfare provision as distinctly modern as something, that began in the 20th century.  But England’s history was quite different from the rest of Europe.  And it has to do with the Protestant Reformation and King Henry VIII, the one with all of those wives, some of whom died under mysterious circumstances.”

C.S. SOONG:  “M-hm.”

DR. FRED L. BLOCK:  “And, so, what happened was that [King] Henry, essentially, expropriated the lands of the Catholic Church.  They were huge landowners.  And what the Protestant Reformation in England meant, one of the main things it meant, was that the lands were taken away from the Catholic Church.

“Now, this was a problem because, in England as across much of Europe, charity was organised by the Catholic Church.  And, so, the people, who fell through the cracks would essentially be taken care of by the Church.  And their accumulation of property was useful because they had economic resources.  And they could provide a certain amount of charity.

“So, when [King] Henry did this, he realised he had to take some compensating action.  And, so, there were a series of poor laws, that were passed from the late 16th century onward.  And what they did was said:  At the most local level of government—which was called the parish; and sometimes parishes were as small as 300, 400 people—that at the parish level, there would be imposed a local tax on those people with property.  And the revenues collected through that tax would be used to support the poor.  And this meant the elderly, the disabled, orphans, and people, who couldn’t find any work, the indigent.  And the idea was that, at the local parish level, if you were a citizen of that parish, the parish was obligated to provide some care, essentially, enough food to keep you alive.  (c. 19:23)

“Now, because this was a local arrangement, the generosity or stinginess varied enormously from parish to parish.  Some were more generous.  Some were less generous.  But the idea was this was a thoroughly institutionalised system, that it existed for something like 200 years.  And people really knew they could depend upon it.

“So, it was a genuine safety net.  And there are, in fact, historians, who have made the argument that England’s earlier leap into industrialisation, uh, than anywhere else in the world was a consequence of having this safety net arrangement because people were wiling to take [economic] risks because their knowledge, that the parish would take care of them, protected them.  I mean, if their entrepreneurial activity didn’t succeed, they knew they wouldn’t starve.  They could come back to the parish; and they would be taken care of.”  (c. 20:31)

C.S. SOONG:  “So, that was the welfare regime, the safety net regime, in England pretty much prior to 1800.  And, then, there are a number of things, that happen, that you lay out in this book.  In 1795, there were problems with food imports, a disastrous harvest.  There were riots.  And, then, there was an effort to reform things via what’s called the Speenhamland Act.  This is also discussed in your book.

“But I want to focus on this Essay on the Principle of Population, which you referred to earlier, written by Thomas Robert Malthus.  It came out in 1798.  So, this is more than—it’s almost 40 years before the law, that really changed things in England, that took away poor relief from so many people, who were needy in that society.  That was the 1834 Poor Law Act.

“So, in 1798, you have this Essay by Malthus.  And what did he argue the Poor Laws, as they existed, did in relation to poverty?  Did he think that the laws alleviated poverty?”  (c. 21:46)

DR. FRED L. BLOCK:  “No, no, quite the contrary.

“So, I mean Malthus is to this day remembered as the founder of the study of population.  And many people will remember learning about what Malthus argued about the fundamental law of population, that human population will grow geometrically, but the food supply grows just arithmetically, meaning the human population is always at danger of outrunning the food supply.  That’s the part of Malthus, which most people remember.

“But, when you sit down and you read through the whole Essay, it becomes clear that the Essay is a polemic against the way the old Poor Law worked, and that, uh, the conventional view, the standard view, on which the Poor Law policy is based is that there’s this poverty and that everybody agrees had been growing in the last decades of the 18th century.  (c. 23:00)

“I mean we know that, at the beginning of the Industrial Revolution, there’s a lot of economic displacement, that there are crafts, that employ a lot of people, that are rising and falling.  And, so, the number of people, who are dependent upon this safety net system has been rising.  I mean that’s the context, in which Malthus is writing. [6]

“And, so, he says that the conventional view is that there’s poverty; and, then, we have the Poor Law to alleviate poverty.  And he says:

This is precisely wrong. The reason that England has so much more poverty than the countries of continental Europe is precisely because the Poor Law is, itself, the problem. The Poor Law is encouraging people, who shouldn’t be having families and having children, to reproduce. It’s contributing very directly to population growth, that is in excess of what the English economy can support at that point in time.”  (c. 24:16)

C.S. SOONG:  “He was influenced by a guy named Joseph Townsend, who was a critic of the Poor Law.  What story about goats and dogs did Townsend tell, that had a big impact on Malthus?”

DR. FRED L. BLOCK:  “Right.  So, Townsend had written, in 1786, a pamphlet called A Dissertation On the Poor Law.  And he told in the pamphlet a story about an island in the Pacific, the Island of San Juan, that was about 200 miles off the coast of Chile.  And, according to Townsend, the Spanish had landed some goats on this island with the idea that the goats would reproduce and the Spanish ships, that were at sea for a long time could stop there, kill some of the goats, and use it to feed the crew on the ship, who were not, you know, getting very much fresh meat after they had been away from Spain for months and months and months.

“But this actually worked.  And, so, the population of goats on the island grew.  But what the Spanish authorities soon realised is that the people, who were benefiting from this, were pirates, who were essentially attacking Spanish ships and stealing their treasure and so forth.

“So, the Spanish authorities decided to land a bunch of dogs on the island on the theory that the dogs would eat the goats and eliminate the pirates’ food supply.  And I guess the Spanish authorities figured they would just find another way to keep their own sailors from starvation.

“So, the story, that Joseph Townsend told was that later travelers to these islands reported that, both, the goats and the dogs essentially had flourished on the island.  But that there was a kind of natural process that only the slower goats were captured by the dogs.  And only the more able dogs were able to get their dinner.  So, this is the earliest form of the survival of the fittest, of the Darwinian theory of evolution, that wasn’t articulated by Darwin until almost a century later. [7]

“I have a footnote here, which is that I actually went to Chile.  I didn’t go all the way to the islands.  But I read up on the most recent historical account.  And what most observers found is that the dogs, in fact, didn’t survive.  There wasn’t a kind of natural equilibrium of goats and dogs.  The goats survived ‘cos they could move very quickly in the hills.  The dogs couldn’t catch the goats.”  (c. 27:24)

C.S. SOONG:  “Fred Block is his name.  He’s Research Professor of Sociology at the University of California-Davis.  He’s author of The Vampire State: And Other Myths and Fallacies About The U.S. Economy [1996].  He’s co-editor with Matthew Keller of the book, The State of Innovation: The U.S. Government’s Role in Technology Development [2011].  And he teamed up with Margaret Somers, who is a Professor of Sociology and History at the University of Michigan on a book, that is now out in paperback.  It’s called The Power of Market Fundamentalism: Karl Polanyi’s Critique.  I’m C.S. Soong.  And this is Against the Grain on Pacifica Radio.

“So, you were talking, Fred, about kind of the biological considerations, the biological emphasis, that Malthus picked up from Townsend and was part of his thinking, maybe, even before he read Joseph Townsend.  And a key theme, that keeps coming up in this chapter is the preference for natural law, the laws of nature—understanding Malthus—Malthus understanding that the laws of nature govern human society, as opposed to the laws of people, the laws made by humans.  For example, the Poor Law, legislation, that would be imposed, maybe, in his phraseology on people and, maybe, upset that natural balance.

“Can you talk about how important it was to Malthus that things be understood in naturalistic terms in a way, that would view social laws, political laws, as a kind of interference?”  (c. 29:07)

DR. FRED L. BLOCK:  “Right.  So, this was the point, that Townsend was making with the goats and the dogs, that the Poor Law, for Townsend and for Malthus, represented this artificial insertion by government, by politics, into the sphere of nature.  And what Townsend and Malthus said is that if we eliminate that artificial interference, by which he meant giving poor people assistance, so that they could buy food and maintain shelter, that if we eliminated that assistance and returned to the previous, more natural state, which they claimed existed at an earlier moment in history, then the same natural process, that had created the balance between goats and dogs on the island in the South Pacific, that same natural law would essentially eliminate the problem of excessive amounts of poverty.  And it would do that because the poor would, essentially, be able to see without any confusion the laws of the market.  They would be able to see that the only way, in which you could get food is if you worked for it.  And, so, they would learn to have the self-discipline and drive to get a job, to keep a job, and earn the money to escape poverty.  (c. 31:00)

“The other side of it, on which Malthus was extremely explicit, was that Malthus believed that there was no inherent right to reproduce, that the only people, who should have children are the people, who have accumulated enough wealth and enough income, that they could support those children themselves.  And the complexity is that Malthus also was totally opposed to birth control and abortion.  So, essentially, he was saying he believed that poor people had no right to sexuality, that they had to restrain their sexual urges until they had achieved enough economic independence that they could, then, afford to enter into sexual relations and be at risk for having children.

“So, the idea, that was kind of central to his argument was that if you suddenly took away the whole system of poor relief, not immediately, but pretty quickly, the poor would understand the new reality of the labour market, of the necessity of controlling their sexual impulses; and they would start working hard and stop having children, that they couldn’t afford to support; and the problem of poverty would magically disappear.”  (c. 32:44)

C.S. SOONG:  “And, so, we have—Malthus saw nature as a self-regulating system, saw society as also self-regulating. [8]”  And, so, when untouched or not interfered with by political intervention, society, constrained by things like scarcity, will tend toward a kind of equilibrium and order.

“So, his ideas are extremely influential.  And they lead to this 1834 Poor Law Amendment Act, which makes poor relief conditional on being incarcerated in a poorhouse, in a workhouse.  And, so, many people are thrown off poor relief.  And poverty gets much worse.  And you can read all about it in Fred Block and Margaret Somers’ book, The Power of Market Fundamentalism.

“Um, such an influential essay—so, I’m assuming, Fred, that this was based on—Malthus’ argument was based on—empirical evidence, that he had data and facts to back him up.”  (c. 33:48)

DR. FRED L. BLOCK:  “No.  That’s the whole point, is that he essentially constructed his argument based on thought experiments.  And, so, the thought experiment had been pioneered by physicists.  And they used it to think about the relations among planets and so forth.

“But Malthus, essentially, said: Let’s engage in the thought experiment of taking away the system of poor relief, that we have.  And, essentially, from the first principles, that he had laid out, the thought experiment led him to the conclusion that if you eliminated the system of poor relief, that England would return to this idyllic earlier situation, in which there was no longer a problem of poverty because the poor would get the signals of the market, um, work hard for a living, and restrain their sexual impulses.  (c. 34:53)

“So, the relevant story about empirical data is that, after Malthus, there was a stalemate.  There were supporters of Malthus, who wanted to eliminate the Poor Law.  And, then, there were many people, who supported the Poor Law.  And there was a kind of extended period of stalemate.  And the stalemate was broken in 1832.  The Whig Party took over Parliament; and they set up a Royal Commission to study the issue of the Poor Law.  And that commission carried out a survey, which is seen as one of the first sociological surveys.  They sent out questionnaires to the parish officials.  But what actually had happened was, in the aftermath of Malthus, there was, essentially, 30 years of Malthusian propaganda saying, essentially—people reading Malthus and other people elaborating his arguments and so forth—that the existing Poor Law made poor lazy and led them to reproduce like bunnies.

“So, the empirical basis for the Poor Law report was that they would send this questionnaire to the parish officials; and they would say:

What has been the effect of the Poor Law on the work ethic of the poor?

“And the people would write back:

Oh, it’s disastrous! These people, you can’t get them to work for anything. They’re so happy just receiving their relief.

“And, then, they would say:

And what’s been the effect of the Poor Law on population, on bastardy, on children being born out of wedlock?

“And the people would write back and say:

Ech, it’s just horrible! They’re having children right and left. And they deliberately—

“I mean Ronald Reagan’s famous story about the welfare Cadillacs, about the people, who were collecting multiple, um, incomes from AFDC and living high off the hog, repeated endlessly in the actual data, or the alleged data, that the Poor Law report propagated.

“So, essentially, a kind of—what Malthus consolidated as this highly prejudicial account of English poor, that, then, various elite groups, political leaders, religious leaders took on as an accurate description.

“I mean it’s as though, um, after [President] Donald Trump speeches about what black communities are like, people sent out surveys to white suburbanites—saying: What’s life like in the ghetto?—and they would just reproduce what [President] Trump had said.”  (c. 37:44)

C.S. SOONG:  “Fred Block, Research Professor of Sociology at the University of California-Davis and co-author of the book, The Power of Market Fundamentalism, published by Harvard University Press.

“We’ll take a short musical break and return and speak more with Fred.  We’ll bring the discussion into the U.S. and talk about welfare deform and Charles Murray and try, if we have time, to bring matters up to the present.  Please stay with us.”

[music break: uptempo jazz combo instrumental featuring piano, drums, and electric bass]  (c. 39:11) 

C.S. SOONG:  “And this is Against the Grain on Pacifica Radio.  My name is C.S. Soong.  Fred Block is Research Professor of Sociology at UC Davis.  He’s president of the Center for Engaged Scholarship.  And we have a link to that center on our website, AgainstTheGrain.org, where you’ll also find a link to the book we are discussing today.  It’s called The Power of Market Fundamentalism: Karl Polany’s Critique. He co-authored it with Margaret Somers, who teaches sociology and history at the University of Michigan.

“So, let’s turn, now, to the U.S. because, as we said earlier this hour, your and Margaret’s project—part of it—was to compare what happened to welfare, to poor relief, in England in the 1700s and into the 1800s with what happened to the welfare system in the U.S. leading up to, and including, the welfare—quote—’reform’ law signed by [President] Bill Clinton in 1996.

“And you have in this book a nice kind of summary of the history of federal welfare assistance in the U.S.  You write that it begins with the New Deal., with a programme later renamed Aid to Families with Dependent Children (AFDC).  And there were attacks on it.  In the 1960s, welfare becomes racialised.

“But that a lot of the efforts to replace AFDC lost steam.  And, even during the [right-wing] Reagan years, the programme was not overhauled.  But, then, in the [neoliberal] 1990s, we get his campaign promise to ‘end welfare as we know it’.  We get conservatives and their think tanks revving up their attacks on welfare, as we knew it.

“And, then, Charles Murray, the well-known conservative intellectual; he co-authored The Bell Curve [1994].  He produced a book; and this, actually, was before the 1990s.  In 1984, his book Losing Ground comes out.  And you write that it was the turning point, that shifted the welfare debate and hastened the elimination of welfare, as we knew it.

“What did Charles Murray argue in his book, Losing Ground?”  (c. 41:40)

DR. FRED L. BLOCK:  “Well, essentially, Murray started with talking about the War on Poverty as something, that actually didn’t stop in the early 1970s, but had continued up ’til 1984.  And he describes all of the federal spending against poverty; and he says: But, look, the problem has just grown worse and worse.

“And, essentially, he starts out by replicating Malthus’ logic.  And, then, Malthus had started by saying that it is the programmes designed to fight poverty are really the cause of poverty.  And Murray, essentially, replicated.  He said: We’ve spent billions and billions. But we’ve only made the problem worse.

“So, what’s remarkable is that Murray, actually, doesn’t mention Malthus in the book.  But, basically, what he did was rewrite Malthus’ argument completely for the late 20th century.  And the giveaway is that after, essentially, making the argument that is now familiar, that giving people AFDC made them lazy and dependent.  They stopped looking for jobs.  They just assumed that they would get money from the government and sat on their behinds.  And the argument that it suddenly became attractive for women to give birth out of wedlock.  And, so, the more children they had, the more assistance they got, so that there was an epidemic of illegitimate births.  (c. 43:34)

“After making all those arguments, Murray, then, says: Well, let’s do a thought experiment.  And, he, essentially replicates Malthus’ thought experiment.

We take away all of this assistance from one day to the next. We announce that one year hence, there’ll be no more Aid to Families with Dependent Children. What will happen—

“And his logic is the same as Malthus, that:

The poor will see that they have to obey the signals of the market. And they will, essentially, clean themselves up, get off the couch, and go look for work and accept the self-discipline, that’s required to succeed in the marketplace. And, lo and behold, they will also stop having these children out of wedlock, recognise that they should only have children when they’ve acquired sufficient amount of economic security to provide for those [children].

“He, then, argues that:

The problem of poverty will go away.

“And part of the point, that we’re making is that this invocation of this kind of natural process, that if we get away from the artificial state interference and just get back to the old-fashioned values and the natural way of doing things, the problem will take care of itself.  (c. 45:13)

“And, so, a part of what we’re trying to get at here is that this libertarian rhetoric, of which this is one part, that we see from Rand Paul and from much of the Republican apparatus, from the Koch Brothers and so forth, all has this same internal structure, that there’s this natural logic to the market, that politics, which is ugly and biased and coercive can be kept to an absolute minimum, if we shift away from government to allowing these natural processes to make these decisions. [9]

“And it is seductive because politics is always problematic.  And, so, the fantasy that the natural logic of a market economy will make everything right has become very attractive.  I mean it’s now kind of deeply built into the worldview of a lot of these Tea Party people and a good chunk of the Republican political base.” [10]

C.S. SOONG:  “You told me that Malthus’ arguments were not backed up by hard data.  Were Murray’s?”

DR. FRED L. BLOCK:  “No.  It was the same idea that their data is presented in an ornamental way.  But that the kind of core arguments about causality are made based upon thought experiments, in deduction from his basic premises.

“There is no evidence presented that public assistance makes people dependent or lazy or encourages excessive child-bearing and so forth.  I mean he doesn’t do any of that.  He simply assumes that everything that’s bad is the result of these interferences into the natural market processes.”  (c. 47:26)

C.S. SOONG:  “I’m C.S.  This is Against the Grain on Pacifica Radio.  Fred Block is Professor of Sociology at UC Davis.  And we are talking about his and Margaret Somers’ book, The Power of Market Fundamentalism: Karl Polanyi’s Critique.

“So, riding kind of the wave of Murryan logic and, therefore, Malthusian logic, there is an effort to hold Bill Clinton to his campaign promise to ‘end welfare as we know it’.  There is, then, the welfare reform law of 1996, that Clinton signs and that he and Hillary Clinton still stand behind.  It’s called the Personal Responsibility and Work Opportunity Reconciliation Act.  What did it mandate?  And what were its consequences?  And do those consequences fit with what Murray might have predicted, and what Malthus might have predicted?”  (c. 48:26)

DR. FRED L. BLOCK:  “Well, this is one of the differences between the English and the U.S. case.

“In the English case, what they did in the 1834 law was move poor relief, uh, from the local parish to a centralised national agency.

“And, in the U.S. case, where assistance through the AFDC was a federal programme administered at the state level, what they did was dismantled the federal piece and turned it back to the states.  This is important because the federal courts had essentially established assistance through AFDC as a right.  And recipients, potential recipients, who were denied for arbitrary reasons or who weren’t getting enough to survive on, had been able to go into the federal courts.  And, particularly, in the late ’60s and ’70s, there had been a number of very progressive federal court rulings, that had supported the rights of AFDC recipients.

“So, what the 1996 legislation did was, by abolishing the programme called AFDC, they also abolished the entitlement.  And what happened as the programme was sent to the states to administer was that the states were required to set a five-year lifetime time limit.  And, then, they had the option of setting shorter time limits.  And they also had the right to sanction people by, essentially, cutting them off the rolls for failing to jump through bureaucratic hoops and so forth.  (c. 50:17)

“So, basic story is that the logic of the legislation was work first.  That: We want to get people off the welfare rolls. We wanna get them into jobs. [11]

“And, so, what almost all of the states did was they set up barriers for anybody new getting onto the new system, which is called Temporary Aid for Needy Families [TANF].  So, when you come into a welfare office now, they essentially push you into looking for work, whatever low-wage work happens to be available.  And you, basically, have to look for work for a period of time before they provide you with any assistance, no matter how desperate your circumstances might be.

“Now, there’s a lot of variation across states.  And what’s happened is that in the more conservative states, the programme has become extremely restrictive.  And governors and state legislators have been empowered to take the money, that’s supposed to go to needy families, through TANF, they’re essentially allowed to use it for other purposes.  So, it’s diverted to childcare programmes and abstinence training and all kinds of other programmes.  (c. 51:47)

“So, when you look at the data—I didn’t bring the actual numbers with me, but—back in the days before 1996, when the AFDC programme existed, the vast majority of poor families with children were receiving some kind of government assistance.  And, as a consequence of the shift to TANF, the percentage of poor families with children, who receive government assistance dropped precipitously.  I think it might now be only a quarter of such families, uh, receive assistance beyond the food stamp programme.

“And the most dramatic consequence we saw in the 2009-2010 recession period—we know that there was a Global economic crisis.  Unemployment in the U.S. went up to about ten percent.  In every previous recession since World War II, the AFDC programme had served as a kind of countercyclical mechanism, that people who were thrown out of work, who couldn’t take care of their families, who weren’t eligible for unemployment insurance, could sign up for AFDC as a safety net programme.  (c. 53:14)

“And, so, one always saw that, as the unemployment level rose, the AFDC rolls also rose significantly.  But the amazing thing is that, even though the 2009-2010 recession was much worse than previous recessions, the increase in the TANF load was very small and, in some states, they continued to cut the TANF load, even as the state was suffering from ten percent unemployment.

“So, basically, the U.S. was saying—I mean the cruelest social policy possible.  I mean that—to people, who had lost their jobs through no fault of their own ‘cos there was a Global Economic Crisis:

I’m sorry. We can’t give you unemployment insurance. We can’t give you welfare. Maybe private charity will be able to help you.

“That strikes me as just extraordinarily inhumane.

“The other point, that I would make here is that one of the ways, that we describe the argument, the anti-welfare argument, that I’ve been describing, is the perversity thesis, which is the idea that, Malthus and Murray, the argument they’re making is that:

Liberals, do-gooders, they think that they’re helping the poor by giving them this free assistance. But, in fact, what we know is that they’re making things worse because they’re making people dependent. They’re sending them the wrong messages. And, so, they’re intensifying the poverty that they wanted [to eliminate]. So, a well-meaning policy has the perverse consequence of making poverty even worse.

“So, the right has used this perversity thesis—to argue that almost any form of government assistance [is harmful]. [12]  I mean some people—well, we saw that in the Romney campaign, when he talked about the 47% of people, who were takers.  The idea is that they’re all welfare chiselers, whether they earned their social security or whatever government pension they might have gotten.  (c. 55:27)

“And what this has led to is kind of this trope that giving people, giving poor people, money will hurt them.  And what’s important to emphasise here is that, particularly, over the last ten years, there’s been around the world a very large-scale experiment with programmes, which are called cash transfers.  Some of them are called conditional cash transfers.  And programmes were developed in Brazil and Mexico.  Some of them started as paying poor families to keep their children in school, paying poor families something more to take their children in for pediatric check-ups.

“But these programmes have expanded.  And some social scientists have estimated that there’s something like a billion people—because the programmes exist in India and China as well, there is something like a billion people—who are receiving these kinds of cash transfers.

“And, so, we now have a growing body of empirical research.  And, lo and behold, when you give poor people in Mexico or in Brazil or India or China some supplemental cash it turns out that it makes their lives better.  They’re able to feed their families.  They’re able to make plans.  They’re able to invest in things, to make entrepreneurial choices. [13]  It doesn’t, in fact, make them dependent and passive or encourage them to have more children or whatever.  (c. 57:09)

“So, we’ve been, in the U.S., essentially, making social policy kind of within this mythical view that giving people assistance is, in fact, something, that hurts them.”

C.S. SOONG:  “Fred Block, Sociology Professor at UC Davis.  He is co-editor, with Matthew Keller, of the book, State of Innovation.  He’s is author of The Vampire State: And Other Myths and Fallacies About the U.S. Economy.

“And we’ve been talking about his book, that he co-authored with Margaret Somers.  It’s The Power of Market Fundamentalism: Karl Polanyi’s Critique.  We have a link to that book, now out on paperback on our website AgainstTheGrain.org.

“Fred, thanks so much for joining us.”

DR. FRED L. BLOCK:  “Oh, it’s been a great pleasure.  Thank you.”

C.S. SOONG:  “And this is C.S., suggesting the important thing is not to stop questioning.  And we hope you’ll join us next time.”

[Against the Grain theme music]

[CART: KPFA LSB candidate statement]  (c. 59:51)

[End of Part One of the Fall 2016 two-part interview with Dr. Fred L. Block, which was broadcast on 30 AUG 2016.]

[Begin Part Two of the Fall 2016 two-part interview with Dr. Fred L. Block, which was broadcast on 6 SEP 2016.]

[KPFA Station identification by Erica Bridgeman(sp?)]

[Against the Grain theme music]  (c. 0:45)

“Today, on Against the Grain, Part Two of my interview with the sociologist Fred Block about his book, The Power of Market Fundamentalism: Karl Polanyi’s Critique.  Plus, we revisit a conversation with Nicolas Lampert about his book, A People’s Art History of the United States.

“I’m C.S. Soong.  That’s all coming up after these [KPFA] News Headlines.”

[KPFA News Headlines (read by Gabriela Castelan) omitted by scribe]  (c. 5:52)

C.S. SOONG:  “From the studios of KPFA in Berkeley, California, this is Against the Grain on Pacifica Radio.  My name is C.S. Soong.

“Last Tuesday [30 AUG 2016], we presented an interview with Fred Block about the ideas of the English thinker Thomas Malthus and the role those ideas played in two major efforts to dismantle government aid to poor people.  One of those efforts, which targeted the Poor Law in England took place in the early 19th century.  The other culminated in 1996 in the U.S. when [then-President] Bill Clinton signed the law, that famously ended welfare as we knew it.

“Thomas Malthus wrote an essay, On the Principle of Population, that was published in 1798.  And that, according to Fred Block, spurred England’s rulers to demolish the centuries-old welfare system codified and represented by the Poor Law.  According to Block, Malthus drew upon an apocryphal story told by Joseph Townsend about goats and dogs achieving a population equilibrium on an island in the South Pacific.  (c. 7:18)

“Almost two centuries later, in 1984, the conservative intellectual Charles Murray revived and deployed Malthus’ ideas in an effort to discredit and dismantle the federal welfare system in the U.S., a system that had been established in the 1930s.

“Today, we present Part Two of my interview with Fred Block, together with a bit of [edited] overlap for the benefit of listeners, who didn’t tune into Part One.

“Fred Block is a Sociology Professor at UC Davis and co-author with Margaret Somers of the book, The Power of Market Fundamentalism: Karl Polanyi’s Critique.

“We pick up with Fred Block sharing these thoughts about Thomas Malthus and his ideas.”  (c. 8:05)

DR. FRED L. BLOCK:  “So, I mean Malthus is to this day remembered as the founder of the study of population.  Demographers, the group of social scientists who focus on population dynamics, consider him the founding theorist of the field.

“And many people will remember learning about what Malthus argued about the fundamental law of population, that human population will grow geometrically, but the food supply grows just arithmetically, meaning the human population is always at danger of outrunning the food supply.  That’s the part of Malthus, which most people remember.

“But, when you sit down and you read through the whole Essay, it becomes clear that the Essay is a polemic against the way the old Poor Law worked, and that, essentially, what Malthus says is that the conventional view, the standard view, on which the Poor Law policy is based is that there’s this poverty and that everybody agrees had been growing in the last decades of the 18th century.  (c. 9:26)

“I mean we know that, at the beginning of the Industrial Revolution, there’s a lot of economic displacement, that there are crafts, that employ a lot of people, that are rising and falling.  And, so, the number of people, who are dependent upon this safety net system has been rising.  I mean that’s the context, in which Malthus is writing. [6]

“And, so, he says that the conventional view is that there’s poverty; and, then, we have the Poor Law to alleviate poverty.  And he says:

This is precisely wrong. The reason that England has so much more poverty than the countries of continental Europe is precisely because the Poor Law is, itself, the problem. The Poor Law is encouraging people, who shouldn’t be having families and having children, to reproduce. It’s contributing very directly to population growth, that is in excess of what the English economy can support at that point in time. (c. 10:44)

C.S. SOONG:  “A key theme, that keeps coming up in this chapter is the preference for natural law, the laws of nature—understanding Malthus—Malthus understanding that the laws of nature govern human society, as opposed to the laws of people, the laws made by humans.  For example, the Poor Law, legislation, that would be imposed, maybe, in his phraseology on people and, maybe, upset that natural balance.

“Can you talk about how important it was to Malthus that things be understood in naturalistic terms in a way, that would view social laws, political laws, as a kind of interference?”  (c. 11:31)

DR. FRED L. BLOCK:  “The Poor Law, for Townsend and for Malthus, represented this artificial insertion by government, by politics, into the sphere of nature.  And what Townsend and Malthus said is that if we eliminate that artificial interference, by which he meant giving poor people assistance, so that they could buy food and maintain shelter, that if we eliminated that assistance and returned to the previous, more natural state, which they claimed existed at an earlier moment in history, then the same natural process, that had created the balance between goats and dogs on the island in the South Pacific [in Townsend’s parable], that same natural law would essentially eliminate the problem of excessive amounts of poverty.  And it would do that because the poor would, essentially, be able to see without any confusion the laws of the market.  They would be able to see that the only way, in which you could get food is if you worked for it.  And, so, they would learn to have the self-discipline and drive to get a job, to keep a job, and earn the money to escape poverty.  (c. 13:15)

C.S. SOONG:  “In their book, The Power of Market Fundamentalism, Fred Block and Margaret Somers point out that Malthus’ arguments about what the Poor Law did to poor people, about how the Poor Law made folks behave, were not supported by any empirical evidence.

“But that did not stop Malthus’ writings from fuelling England’s move from a system of poor relief to a much harsher, much stingier, in fact, punitive regime in 1834.

“It also didn’t stop Charles Murray from drawing on Malthus’ ideas in Murray’s 1984 book, Losing Ground.

“Fred Block told me that the argument, Murray and Malthus made was that:”

DR. FRED L. BLOCK:  “[One of the ways, that we describe the argument, the anti-welfare argument, that I’ve been describing, is the perversity thesis, which is the idea that, Malthus and Murray, the argument they’re making is that:]

Liberals, do-gooders, they think that they’re helping the poor by giving them this free assistance. But, in fact, what we know is that they’re making things worse because they’re making people dependent. They’re sending them the wrong messages. And, so, they’re intensifying the poverty that they wanted [to eliminate]. So, a well-meaning policy has the perverse consequence of making poverty even worse.

“So, the right has used this perversity thesis—to argue that almost any form of government assistance [is harmful]. [12]  I mean some people—well, we saw that in the Romney campaign, when he talked about the 47% of people, who were takers.  The idea is that they’re all welfare chiselers, whether they earned their social security or whatever government pension they might have gotten.  (c. 14:51)

“And what this has led to is kind of this trope that giving people, giving poor people, money will hurt them.  And what’s important to emphasise here is that, particularly, over the last ten years, there’s been around the world a very large-scale experiment with programmes, which are called cash transfers.  Some of them are called conditional cash transfers.  And programmes were developed in Brazil and Mexico.  Some of them started as paying poor families to keep their children in school, paying poor families something more to take their children in for pediatric check-ups.

“But these programmes have expanded.  And some social scientists have estimated that there’s something like a billion people—because the programmes exist in India and China as well, there is something like a billion people—who are receiving these kinds of cash transfers.

“And, so, we now have a growing body of empirical research.  And, lo and behold, when you give poor people in Mexico or in Brazil or India or China some supplemental cash, it turns out that it makes their lives better.  They’re able to feed their families.  They’re able to make plans.  They’re able to invest in things, to make entrepreneurial choices. [13]  It doesn’t, in fact, make them dependent and passive or encourage them to have more children or whatever.  (c. 16:33)

“So, we’ve been, in the U.S., essentially, making social policy kind of within this mythical view that giving people assistance is, in fact, something, that hurts them.

“And, so, one more instance of this is that, in terms of housing policy, the dominant model for dealing with homelessness has, basically, reflected this philosophy, essentially, saying that:

Most of the homeless have mental disorders or addiction problems.  And, so, what we’re gonna do is create programmes for them.  And, once the deal with their problems and have gotten a job, then, we’ll get them a home.

“And that’s been the dominant model of homelessness policy, since the [President] Reagan era.

“What’s happened in the last few years, under the Obama administration, starting with veterans, is that there’s a new policy option, which is called Housing First to deal with the problem of homeless veterans.  And it’s been implemented in many cities now.  And, essentially, the new policy is:

Maybe a lot of the homeless do have mental health and addiction problems. But their real problem is that they’re homeless. And, so, we’re gonna give them housing first, and give them access to social services to deal with their other problems, and to help them find work and so forth. [11]

“And, lo and behold, with veterans, the Housing First policy has worked.  And a number of cities have declared that they’ve actually eliminated the homelessness problem among their veteran populations.

“So, the logical conclusion is that Housing First should be a general policy, not just for veterans, for all the homeless people, and that we no longer have to be so fearful of this, basically, 18th century idea that assisting people will make them worse off.  Assisting them can make them better off and can directly address their most pressing problem, which is a lack of resources.” [11]  (c. 18:59)

C.S. SOONG:  “Yeah.  These ideas, Malthus’ ideas, Murray’s ideas, have tremendous power.  And that’s another point you wanna make in this book, or that you make in this book, which is the power of ideas to really sway people in critical circumstances.

“Um, a lot of people know of the term regime change.  Well, my guest, Fred Block and Margaret Somers talk about ideational—as in ideas, ideational—regime change and how, you know, the thunderous consequences, that have accompanied that in particular moments in history.

“So, Fred, we’ve really been focusing on one chapter of this book, The Power of Market Fundamentalism, that you co-authored with Margaret Somers.  Can you give us a brief schematic of what else readers will find of interest in this book?”  (c. 19:52)

DR. FRED L. BLOCK:  “Well, we used the welfare case as a kind of example of the logics, that have been used to shape public policy across a whole set of issues—financial policy, international trade policy, labour policy, all of these different realms—that the basic logic of the market fundamentalists is the same, that state action is artificial, arbitrary, and that it disrupts the natural logic of markets when they’re left to themselves.

“And one of the main points, that we’re making—and this is where Karl Polanyi, who was a Hungarian refugee intellectual, who wrote his masterpiece, The Great Transformation, and published it in 1944—that the core of the argument, that he was making is that this idea that the economy is natural, that the market economy is natural, and that it exists as an autonomous structure independent of the state is a myth, that it simply doesn’t understand the history and the reality.  Essentially, his argument is that state action is required to construct and to maintain markets.  And we know that because the state establishes property law and enforces it.  It establishes contract law and enforces it.

“And, so, the idea that there’s some kind of economy, that exists away from the state, and that what the state does is intervention in that separate sphere is all a kind of intellectual misconception [or deception], that the state is necessary to constitute the market. [14]

“And, so, one of the points, that we make is that even many on the left have [acquiesced to the language of the right and] kind of railed against one of the core policies of the right, which they termed deregulation, that essentially the claim is that financial markets, other markets, were deregulated.  And the market fundamentalists love that term because, for them, deregulation is that they get the evil government out; and they return that market to the natural order of things.  (c. 22:34)

“And what we say is that that’s, again, a category error to think of it as deregulation.  What we’re really talking about is re-regulation. [15]

“So, what happened in the financial sphere, as a consequence of the lessons of the Great Depression, we had a set of financial regulations, which were designed to protect consumers, protect the public against dangerous forms of speculation, that could wreck the economy, that could gouge borrowers, and so forth.

“And, so, what happened in the shifts in policies in the 1980s and ’90s [particularly with President Bill Clinton’s reregulation of the financial sector under the Reinventing Government initiatives, which laid the groundwork for the Global Financial Crisis] was not deregulation of the financial sector, but the reregulation in a way, that essentially protected the giant banks and other financial institutions and took away the measures, that protected consumers, protected the society from excessive amounts of speculation, and that it was reregulation because the government was centrally involved.  It rewrote the laws.  It negotiated with the banks.  And it was constantly telling the biggest banks and financial institutions that:

We know you’re too big to fail. And, if you come into crisis, don’t worry the Federal Reserve will bail you out. We’ll figure out a way to make you survive.

“So, essentially, deregulation makes it appear that these financial institutions and big corporations were out there in the wilderness doing their own thing.  But the reality was that the government always had their back, was always intimately involved in their affairs, and, ultimately, did rescue almost all their major players.  I mean, yes, they let Bear Stearns and Lehman Brothers go under.  But everybody else was, ultimately, protected in the game.  (c. 24:40)

“So, that’s why we’re so insistent that the language, the ideas really matter because deregulation appears like this return to a natural order; and it seems right.  But we’re saying, and Polanyi was saying: There is no natural order.  The economy has always been socially and politically constructed. 

“And the political lesson for us is that, because it has been socially and politically constructed, it can be reconstructed in a way, that doesn’t just send all of the benefits to the top 1%, but rather in a way, that creates an economy that’s inclusive, that’s egalitarian, that distributes the resources more fairly.

“The myth of naturalism is a way of keeping the democratic public away from these key decisions, that shape the economy.  And the result of that naturalism is partly what has given us this increasingly unequal distribution of income and wealth.  And the way, that we can get back to a more equal distribution of income and wealth is by recognising that the market is politically constructed and needs to be reconstructed.”  (c. 26:07)

C.S. SOONG:  “That’s Fred Block, Research Professor of Sociology at the University of California-Davis, and co-author of The Power of Market Fundamentalism: Karl Polanyi’s Critique, now out in paperback from Harvard University Press.

“You’ll find the first part of my interview with Fred by going to AgainstTheGrain.org and clicking on the August 30th [2016] programme.

“We’ll take a short break and return with a conversation with Nicolas Lampert about his book, A People’s Art History of the United States.  Please stay with us.”  (c. 26:38)

[snip]

[snip]  (c. 59:59)

Learn more at AGAINST THE GRAIN.

***

[1]  For more on how MMT debunks myths perpetuated by neoclassical economics, see:

“MMT AND EXTERNAL CONSTRAINTS” by Dr. L. Randall Wray, Professor of Economics, University of Missouri-Kansas City, 24 FEB 2014

To Fix or To Float, that is the question.

MMT argues that a sovereign government that issues its own “nonconvertible” currency cannot become insolvent in terms of its own currency. It cannot be forced into involuntary default on its obligations denominated in its own currency. It can “afford” to buy anything for sale that is priced in its own currency. It might be able to buy things for sale in foreign currency by offering up its own currency in exchange—but that is not certain.

If, instead, it promises to convert its currency at a fixed price to something else (gold, foreign currency) then it might not be able to keep that promise. Insolvency and involuntary default become possible.

Generally speaking, the nonconvertible, floating exchange rate currency system provides more policy space. Government can use fiscal and monetary policy to pursue the domestic agenda. Fixing the currency reduces policy space because government must consider its promise to convert. That can conflict with the domestic policy agenda. For example, it is usually (but not always) the case that the government must pursue policy to ensure a positive flow of foreign currency (or gold) to be accumulated as a reserve to maintain the peg.  That usually means domestic unemployment to keep wages and imports down.

So far, this is just logic. Pegging your currency adds a constraint: you need to obtain that-to-which-you-peg in order to ensure you can convert at the pegged price. How binding is the constraint? It depends. In the case of China today, its “managed” exchange rate is not very binding. For example, China has committed to fairly rapid growth of domestic wages. By contrast, in the case of Nepal, the peg against the Indian currency is constraining. If Nepal were to pursue China’s policy of raising wages, her trade deficit with India would grow; unless she could somehow increase remittances from her workers abroad, reserves of Indian currency as well as dollars would be depleted. Her peg would be threatened and a currency crisis would be likely.

Now, would China or Nepal benefit from floating? I have no doubt that China would eventually be in a position where floating would not only be desired, but it would be necessary. China will probably float long before it reaches such a position. China will become too wealthy, too developed, to avoid floating. She will stop net accumulating foreign currency reserves, and will probably begin to run current account deficits. She will gradually relax capital controls. She might never go full-bore Western-style “free market” but she will find it to her advantage to float in order to preserve domestic policy space.

If she did not, she could look forward to a quasi-colonial status, subordinate to the reserve currency issuer. China will not do that.

MMT emphasizes that in “real” terms, imports are a benefit and exports are a cost. Floating the currency and relaxing capital controls allows a nation to enjoy more “benefits” (imports) and fewer “costs” (exports). The nation can “afford” to enjoy all the output it can produce plus whatever output the rest of the world wants to sell to it. It “pays for” those net imports through expansion of its capital account surplus. On the capital account, this is reflected in rest of world accumulation of financial claims denominated in the importer’s currency.

The balances balance. While many say the USA has a “trade imbalance” because the current account is in deficit, there is no imbalance because the capital account is in surplus. Dollar for dollar. There cannot be an imbalance. Foreigners want the dollar assets, and so they sell their output to the USA. Perhaps it is their national interest to do so; perhaps it is not. This is not a matter for me to judge. It is certainly in someone’s interest or they would not do it. Maybe the exporters run policy. Maybe the rich elite do. Or maybe it really is in the national interest.

Brian Romanchuk has a great piece up at his blog: “Why Rich Countries Should Float Their Currencies” (see here). He’s a bond market expert who recognizes that rich, developed countries do not face an “external constraint” so long as they float. I’m not going to repeat his whole argument—you really should read his piece—but here’s the main point: if foreigners want to sell their output to your country, you don’t need to worry about how to get the foreign exchange to finance that.

“There is an accounting relationship that says that foreign entities* have to place financial inflows into a country to match the outflows corresponding to its current account deficit (ignoring small external flows like foreign aid transfers). This seems to imply that foreigners have veto power over a country’s policies, and I have seen arguments that domestics are forced to borrow in foreign currencies as a result of the accounting.

 However, the volume of foreign exchange transactions have been found to be an order of magnitude larger than what is needed to support trade flows. This hyperactivity is partially the result of foreign exchange trading, but it also reflects very large gross cross-border capital market flows. These flows determine the relative value of currencies. The ultimate counterparty to an importer is most likely a foreign investor who wishes to run foreign exchange risk; there is no necessity for domestics to have to borrow in foreign currencies to finance imports.

 It is very possible that a fall in the currency will make a current account worse (as imports become more expensive, and quantities do not immediately adjust), a point that was made in the comments to my previous article. But since the valuation of currencies are driven by capital flows, not trade flows, this cannot go on forever. The domestic wage bill of exporters is being deflated versus international peers, and they become more competitive. (Imported input prices rise in local currency terms, but they pay the same world prices faced by competitors.) Since the exporters are more competitive, expected future profits rise, making domestic equities relatively more attractive. This effect will eventually limit the weakness of the currency. And the empirical reality is that the developed market currencies move around a lot, there appears to be a limit how far they can deviate from a purchasing-power parity fair value estimate.

Although currency volatility is disruptive, companies can use currency hedges to limit the impact of short-term volatility. In a country like Canada, where currency volatility is expected, business managers have learned the hard way that external currency economic exposures need to be controlled. (For example, the next year’s expected foreign currency revenue may be hedged, giving time to react to forex moves.) Conversely, what we we saw in Asia in 1997 was that businesses had come to rely on central banks stabilising the currency, and they engaged in speculative cross-currency exposures (such as borrowing in U.S. dollars because “interest rates were lower”). To paraphrase Minsky, instability is stabilising.

 In any event, I argue that a bid for a developed market currency always exists at some price, because of the potential demand for local currency financial assets. It would require the currency to essentially cease to exist in order for there to be no demand for the currency. This could result from the government repudiating its debt, or regime change (war, revolution). Additionally, it could result from a mass default by the domestic banking system. The latter possibility is very real, and it explains why that it is necessary for regulators to prevent domestic banks from building up foreign currency exposures (as seen in Iceland). This implies that there is a constraint on regulation – banks must be regulated in a fashion that is coherent with a free float in the currency. Many countries have failed to regulate their banks properly (e.g., foreign currency mortgages are commonplace in many countries), but their incompetence does not mean that it is impossible to run a banking system properly.

 Under the assumption that there is always a bid for the currency, it will always be possible to finance a current account deficit. The only question is the price at which the financing occurs”.

To put this as succinctly as possible, if you offer US or Canadian or Australian Dollars, or UK Pounds, or Japanese Yen, or Euroland Euros, you will NEVER find a lack of bidders. The only question is over the price. Heck, I’ve offered Mexican Pesos, and Colombian Pesos, and Turkish Lira and many other currencies  many times, and never found a lack of bidders.

Brian goes on to admit he’s only talking about the situation of “rich” countries. He says he suspects it is better for the developing countries to float, too, but they face difficult problems that he doesn’t feel he knows enough about.

I’m with Brian on that. Frankly, I do not know if Nepal would do better if it floated. I suspect that for many of the world’s poorest countries, the exchange rate regime is not the central issue—and they are probably screwed whether they fix or they float.

Critics of MMT love to point to such cases as proof that MMT is somehow wrong. They challenge us to find a solution to the problems faced by poor countries. If MMT cannot find a simple solution to the complex problems facing developing nations, then somehow MMT is wrong. It is a most bizarre claim.

All we claim is that with a sovereign, floating currency a government of a developing nation can “afford” to employ all its domestic resources that are willing to work for the domestic currency.

Will such a nation be able to import all that it wants? Probably not. Would pegging the exchange rate allow it to import more? Maybe—but then it is very likely that it will have to give up full employment at home. And it will be subject to insolvency and default risk (because it has promised to deliver something it might not be able to deliver).

Is that a trade-off that is in the domestic interest? I doubt it, but I am not sure.

What I observe out in the real world is that pegged exchange rates in developing countries are usually in the interests of the elites—who like their luxury imports and vacations in NYC and Disneyworld. Typically somewhere around half the population is either unemployed or “casually” employed (washing windshields of the luxury imports at stoplights).  Seems like a bad trade-off to me.

The big bogeyman usually raised is “inflation pass-through”. A floating currency opens the possibility of exchange rate depreciation that raises the costs of imports and “passes through” to domestic inflation. As Brian says that inflation impact is usually vastly overstated.

Neil Wilson has a good take on all this, too, in his piece “It’s the Exporters Stupid”:

“The key point is that if a currency moves down so that imports become ‘more expensive’, then the ‘inflation’ that goes off is a distributional response that tries to eliminate some of those imports so that the exchange demands equalise. That also eliminates somebody else’s exports.

The important thing to remember is that when a currency goes down, all the others in the world go up in relation to it and nations that rely upon exports (export led nations) start to lose trade – which depresses their own economy.

Any one of those other economies can intervene in the foreign exchange markets, purchase the ‘spare’ currency and that will halt the slide for everybody. And all exporters to an import nation have a central bank with infinite capacity to do that.

Export-led nations have to constantly provide liquidity into the rest of the world to allow others to buy their goods. Otherwise the rest of the world runs out of the particular money that is needed for the export transaction to complete and the export never happens (UK buyers buy Chinese goods with GBP, but Chinese workers are paid in Yuan. The relative shortage of Yuan due to the export differential has to be provided by the Chinese or Chinese goods become, in absurdum, infinitely expensive).

So the important insight, IMV, is that exporters need to export and the central banks that support that policy with ‘liquidity operations’ will ultimately halt any slide for any important export destination – either explicitly or implicitly through their own banking system….

For me the policy response to sliding currencies is to control the distributional inflation by temporarily banning the import of ‘luxury’ items. That forces the problem onto the exporters, which they can relieve by systemically intervening and fixing the currency imbalance. Forcing them to do what they normally do through the course of trade.”

I agree with Neil that it is better to float and then deal with the pass-through inflation; and it makes sense to force as much of the “pain” of fighting the inflation on the rich as possible. After all, they are the ones importing the BMWs and taking the kids to Disneyworld. As Neil notes in response to Ramanan, I have argued as follows: “the MMT principles apply to all sovereign countries. Yes, they can have full employment at home. Yes, that could lead to trade deficits. Yes that could (possibly) lead to currency depreciation. Yes that could lead to inflation pass-through. But they have lots of policy options available if they do not like those results. Import controls and capital controls are examples of policy options. Directed employment, directed investment, and targeted development are also policy options.”

I am not flippant about the many real constraints faced by a poor, developing nation. At an early stage of development, imports are very hard to get. The national currency faces little external demand. The world doesn’t want the nation’s produce, so it cannot export. Borrowing foreign currency can easily lead to excessive debt service and financial collapse.

Neither floating nor fixing is going to easily resolve these problems. That MMT does not have an easy solution to them does not, in my view, prove that MMT is flawed. My suspicion is that floating the currency and taking advantage of the sovereign’s ability to spend domestically is a step in the right direction. Capital controls are probably necessary—even more so if the country does not float. Foreign aid is probably necessary to finance needed imports.

Full employment of domestic resources is even more important for the developing nation than it is for the rich, developed nation. And yet what we find is precisely the reverse: unemployment is much higher because the government thinks it cannot “afford” to offer jobs. Hence, MMT can offer useful advice even if it cannot offer a magic wand to wish away all the problems faced by developing nations.

[2]  Terrestrial radio transmission, 94.1 FM (KPFA, Berkeley, CA) with online simulcast and digital archiving:  Against the Grain, this one-hour broadcast hosted by C.S. Soong, Tuesday, 30 AUG 2016, 12:00 PST.

Broadcast summary from the kpfa.org archive page:

[3]  Terrestrial radio transmission, 94.1 FM (KPFA, Berkeley, CA) with online simulcast and digital archiving:  Against the Grain, this one-hour broadcast hosted by C.S. Soong, Tuesday, 6 SEP 2016, 12:00 PST.

Broadcast summary from kpfa.org archive page:

[4] The two-part interview series was re-broadcast as follows:

Terrestrial radio transmission, 94.1 FM (KPFA, Berkeley, CA) with online simulcast and digital archiving:  Against the Grain, this one-hour broadcast hosted by C.S. Soong, Monday, 17 APR 2017, 12:00 PST.

Terrestrial radio transmission, 94.1 FM (KPFA, Berkeley, CA) with online simulcast and digital archiving:  Against the Grain, this one-hour broadcast hosted by C.S. Soong, Wednesday, 19 APR 2017, 12:00 PST.

[5]  Dr. Fred L. Block, a sociology professor, described the similarity between right-wing/(neo)classical responses to poverty in early 19th century England and late 20th century United States, where in both historical episodes economic policy turned its back on poverty relief and the social safety net.  Dr. Block noted:

So, there was a huge change in the recipients of welfare, the type of aid, that they were getting.  But the larger political context of the debate was so remarkably similar.

What one finds when one studies the history of economic theory and policy is that, generally speaking, the further back one goes in human history, the less democratic, the less egalitarian, and the less humanistic were economic policies.  Many people were in bondage, slavery, indentured servitude, mired in poverty, or socioeconomically stratified for generations.  Income inequality was such that some people lived in luxury, whilst most lived in squalor.  But the economic thinkers and theorists, whom economic historian Dr. Robert Heilbroner called the worldly philosophers, have tended to approach economics, either, from above, privileging capitalist property owners, or from below, sympathising with the plight of labour, of the working classes, who must live at the mercy of the capitalist wage system.

So, yes, there are similarities in the larger political context of debates even centuries apart because there have always existed ruling class elites, who have no sympathy for the working classes.  The wealthy and the political elites have no sympathy for the working poor because it’s in their material interests to blame the poor for their own poverty.  Laws, including labour relations, can be established to be fair or unfair to workers.  The more workers are exploited, the more profits can be horded by the capitalist owners.  This has been true during the centuries, which capitalist modes of production have dominated societies.  We find many other historical episodes, which reveal this reality, beyond the two Dr. Block discusses here.

For additional resources, consider the following books, which your author studied in a History of Economic Thought course at the University of Missouri-Kansas City’s heterodox economics department:

• History of Economic Thought: A Critical Perspective (latest edition) by E.K. Hunt and Mark Lautzenheiser.
• Teachings from the Worldly Philosophy (latest edition) by Robert L. Heilbroner.

Also consider:

• The Worldly Philosophers: The Lives, Times, and Ideas of the Great Economic Thinkers (latest edition) by Robert L. Heilbroner
• Contending Economic Theories: Neoclassical, Keynesian, and Marxian (latest edition) by Richard D. Wolff and Stephen A. Resnick

[6]  Dr. Block pointed out the mass economic displacement caused by the rise of the Industrial Revolution at the time of Malthus’ Essay on the Principles of Population.  Then, as now, standard economics curricula present Malthus’ austerity politics as politically neutral scientific analysis, involving statistical rigor and so forth.

But, as Dr. Block points out, a thorough reading of Malthus’ Essay reveals it’s primarily a polemic against poor relief.  And, given the historical context, we can see that Malthus’ Essay functioned as apologia for the capitalist modes of production of his time, which were proletarianising rural workers, driving people off the land and into factory systems of the burgeoning Industrial Revolution.  The Industrial Revolution was profitable for ruling class elites, whose interests Malthus represented.  But it meant mass economic displacement, poverty, and misery for most of the working classes.  But, rather than investigate or acknowledge the adverse effects of capitalist modes of production, Malthus simply argued that poor people didn’t deserve to procreate because they couldn’t afford it, and that poor people should simply live within their means, even if that means starvation.  Even Dr. Adam Smith had already acknowledged the various adverse effects of the new factory system, or capitalist modes of production with wage labour.  But Malthus was ignorant or unsympathetic.  After much study, the latter seems more likely.  Discussing Malthus in a History of Economic Thought course at UMKC, I asked the professor if it was reasonable to psychologically profile Malthus as a sociopath.  That’s reasonable, he responded.

[7]  Dr. Block referenced the so-called survival of the fittest notion, which is often ascribed to Charles Darwin, but was actual the political tool of the rather reactionary Herbert Spencer (1820–1903), the English philosopher, biologist, anthropologist, sociologist, and prominent classical liberal political theorist of the Victorian era.  As Dr. Block noted, Darwin never articulated that notion, which has had negative consequences in terms of distorting concepts of evolutionary theory and contributing to racist ideologies, which argue for racial (i.e., ethnic, or phenotypic) hierarchies according to notions of racial purity and racial superiority.

But we must always clarify what Charles Darwin did actually articulate in his Origin of Species, which argued for natural selection and the transference of genetic qualities across generations; this means, more precisely stated, the survival of the most adaptable.  That is a very different notion than Herbert Spencer’s more rigid construct of the survival of the fittest, which served Spencer’s ideological agenda, but inaccurately suggested that the physically strongest always prevail in an evolutionary sense; such a notion further suggests in quite insidious fashion that might equals right.  Spencer’s survival of the fittest rationalised the domination over the weak and vulnerable by the strong.  This is consistent with the, essentially, right-wing views of Joseph Townsend, who influenced R. T. Malthus’ draconian Essay on Population.  Townsed criticised English poor relief laws harmful to society by allowing the population to swell by protecting the weak—see his parable of the goats and dogs on the Island of Fernandez[?]—and thus called for the abolition of any state relief in pursuance of greater productivity, as “it is only hunger which can spur and goad them on to labour.”  On the 19th century usage of Darwinism, or distortions of the Darwinian theory of natural selection:

“Darwinism” soon came to stand for an entire range of evolutionary (and often revolutionary) philosophies about both biology and society.  One of the more prominent approaches, summed in the 1864 phrase “survival of the fittest” by Herbert Spencer, later became emblematic of Darwinism even though Spencer’s own understanding of evolution (as expressed in 1857) was more similar to that of Jean-Baptiste Lamarck than to that of Darwin, and predated the publication of Darwin’s theory in 1859.  What is now called “Social Darwinism” was, in its day, synonymous with “Darwinism”—the application of Darwinian principles of “struggle” to society, usually in support of an anti-philanthropic political agenda.  Another interpretation, one notably favoured by Darwin’s half-cousin Francis Galton, was that “Darwinism” implied that because natural selection was apparently no longer working on “civilized” people, it was possible for “inferior” strains of people (who would normally be filtered out of the gene pool) to overwhelm the “superior” strains, and voluntary corrective measures would be desirable—the foundation of eugenics.

[8]  We observe that Malthus argued for approaching the economy as a natural system, which means viewing it as a self-regulating system.  We observe that this is consistent with classical (and neoclassical) economists, particularly on the right, who viewed capitalist modes of production, capitalist economic systems, as self-regulating, according to the laws of supply and demand and self-equilibrating markets.

Of course, the pretext for this view is the undermining of any economic assistance for the poor or other victims of the new factory system, or the new capitalist modes of production.  Ruling elites, and their ideological representatives, such as Thomas Robert Malthus, Joseph Spencer, Herbert Spencer, et al., sought to rationalise the burgeoning capitalist economic system and deflect away from the downsides of the new capitalist factory system with its wage labour relations and structural unemployment fluctuations.

[9]  Dr. Block noted that this right-libertarianism “all has this same internal structure, that there’s this natural logic to the market, that politics, which is ugly and biased and coercive can be kept to an absolute minimum, if we shift away from government to allowing these natural processes to make these decisions.”

What Dr. Block failed to admit, however, was that the common denominator to all of these arguments and rhetoric on the right—and even coming from the neoliberal Democratic Party machine—is a non-negotiable and uncritical defense of capitalism, or capitalist modes of production, however unequal, unfair, hierarchical, polarising, and exploitative.  For example, in 2017, in the wake of the Bernie Sanders revolution, which saw a mass rejection of capitalism in favour of socialism or social democracy, the House leader of the Democratic Party, Nancy Pelosi, was taken to task by a college student during a Town Hall gathering about the failures of capitalism and free market fundamentalism.  But Pelosi responded with knee-jerk apologism for capitalism:  We’re capitalist. And that’s just the way it is.

[10]  Dr. Block correctly pointed out how these Malthusian arguments and free market fundamentalism is “deeply built into the worldview of a lot of these Tea Party people and a good chunk of the Republican political base.”

What Dr. Block failed to admit, however, is that much of this free market fundamentalism is also deeply built into the worldview of most Democrats, certainly the worldview of the Democrat Party bosses, who are those Democrats most loyal to their corporate, capitalist, campaign funders.

[11]  Here we recall the progressive economic policy proposal known as the MMT-based job guarantee (JG), or employer of last resort (ELR), programme, which can effectively end involuntary unemployment as we know it and provide jobs for anybody willing and able to work.

Apparently, Dr. Block is unaware of modern monetary theory (MMT).  As far as the hosts of Against the Grain, they also seem to be unaware of MMT, which is truly unfortunate.  Your author has communicated this cutting edge understanding of our modern monetary system to various broadcasters at free speech radio KPFA, since first hearing about it on KPFA’s own Guns and Butter, then formally studying it at the University of Missouri-Kansas City.  But, as of yet, none of the free speech radio broadcasters have learned this economics lesson, or been willing to incorporate it into their analyses.

[12]  Dr. Block cited the right-wing’s anti-welfare perversity thesis.  It is one of three narratives described by economist Dr. Albert O. Hirschman in his 1991 book, The Rhetoric of Reaction: Perversity, Futility, Jeopardy in which he

styles the rhetoric of conservativism in opposition to social change as consisting of three narratives: perversity, futility, and jeopardy, and that, further, these narratives are simplistic and flawed, and cut off debate. After a historical examination of his thesis, he discusses corresponding progressive narratives, and proposes a new framework.

Hirschman takes as a starting point the neoconservative critiques of social security and other social welfare programs. Recalling Thomas Humphrey Marshall‘s theory of the development of citizenship in the West by which civil, political, and social dimensions of citizenship are successively achieved, Hirschman illustrates the rhetoric of reactionaries through citing arguments concerning three major reforms: the French revolution, moves toward universal suffrage in the 19th and 20th centuries, and the concerns over the welfare state in his time.

[13]  Dr. Block described the growing body of research being gathered from approximately one billion beneficiaries of cash transfer, or conditional cash transfer, programmes around the world.  He reported that cash transfers improve the lives of the needy or indigent.

Here, we are reminded of the Keynesian, or Post-Keynesian, argument for countercyclical government spending to stimulate a faltering economy through a spending multiplier function.  When the economy is slow, production declines, which means businesses slow down due to weak sales.  The more the economy slows and more people lose work and income, the less people spend, and the more companies further slow down, reduce production, and further lay off workers.  When the economy slows down and the private sector is leery of investing due to sluggish demand, it becomes necessary for the public sector, the state, the government to engage in social spending to inject money into the economy and get people working again.  This can be done through cash transfer programmes, as Dr. Block noted.  Or this can also been done through an MMT-based job guarantee (JG), or employer of last resort (ELR), programme.  We recall that Modern Monetary Theory (MMT) is a relatively recent offshoot of Post-Keynesian economics, which is influenced by the macroeconomic modelling of Wynne Godley and Hyman Minsky’s ideas on the labour market, as well as chartalism and functional finance.

[14]  Dr. Block points out the fact that all markets are social constructs.  We recall a recurring observation by heterodox economist Dr. Michael Hudson, who has long pointed out the fact that all economies are planned economies.  There are no free markets, or unplanned economies.  The only question is whether an economy is organised and planned by Wall Street for the ruling class (or the 1%), or whether they are organised and planned by Main Street for the working class (or the 99%).

[15]  We recall cognitive linguist Dr. George Lakoff, who has pointed out the power of language and the folly inherent in the left’s usage of the language of the right.  In his book, Don’t Think of an Elephant: Know Your Values and Frame the Debate, Dr. Lakoff points out that simply planting the seed of a concept in the minds of one’s audience strengthens particular worldviews through the invocation of conceptual frames, which register differently depending on the individual’s particular worldview.  Dr. Lakoff has described two dominant worldviews in political thinking: the strict father model and the nurturant parent model.

In terms of the language of regulation and deregulation used by the right, Dr. Lakoff reminds the left to never use the language of the right.  Regulation and deregulation are terms, which evoke conceptual frames of reference about freedom and restriction.  So, getting rid of regulations evokes conceptual frames of increasing freedom.  On the other hand, a different, perhaps more accurate, terminology would instead speak in terms of protections.  Regulatory policies and institutions are designed to provide protections for the public against corporate and other abuses.  Thinking about protections, rather than regulations, invokes a conceptual frame, which is more conducive to holding business, corporations, and institutions accountable to the public.

***

[30 AUG 2016]

[Last modified at 16:20 PST on 23 APR 2017]

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