Jeffery Sachs is a world-renowned macro economist whose most well-known book is The End of Poverty, 2005. He literally believes that we now have the knowledge that could enable us to end poverty in our world. The question is, do we have the passion, the will to do so? So the End of Poverty is a rather optimistic book, By contrast, The Price of Civilization is a more negative and more honest examination of American culture and American capitalism.
A quotation from The Price of Civilization:
"Too many of the American elite---among the super-rich, the CEOs, and many of my colleagues in academia---have abandoned a commitment to social responsibility. They chase wealth and power, the rest of society be damned."
Sachs thinks the middle class is O.K., (though later in the book he severely condemns consumerism); I think that all of America is much like Israel described in Jeremiah 6 and 8---everyone from the prophet and priest down to the ordinary person is greedy for gain.
Sachs writes about the "interplay of political, economic, and a society's values." Or another way of putting it is an interplay of the religion-politico-economic elite. Sachs pushes hard for the rich to stop their greed and oppression and become socially responsible.
"Our greatest national illusion is that a healthy society can be organized around the single-minded pursuit of wealth. The ferocity of the quest for wealth throughout society has left American exhausted and deprived of the benefits of social trust, honesty, and compassion. Our society has turned harsh, with the elites on Wall Street, in Big Oil, and in Washington among the most irresponsible and selfish of all."
"We are living through a new Gilded Age exceeding the gaudy excesses of the 1870s and the 1920s."
"And Wall Street firms such as Goldman Sachs, Citigroup, and JP Morgan Chase not only were the central actors in the financial crisis of 2008 but were the very places to which Obama turned to staff the senior economic posts of his administration."
"How did the world's leading economy reach such a position of despair and apparently in a short period of time?" After World War II to the 1970s, political and economic leaders created a healthy mixed economy, but in the 1980s, things began a severe downturn.
Sachs continues: "After decades of global economic leadership, America began in the 1980s to forget the basic lessons of economics, parroting slogans (typically about the wonders of the free market) while neglecting the art of economic policy. One of the most basic and important ideas of economics---that business and government have complementary roles as part of a 'mixed economy'---have been increasingly ignored, to my amazement and consternation." Reagan was wrong when he stated that government was the problem.
Sachs states that there are five core ideas of modern mixed capitalism:
" * Markets are reasonably efficient institutions for allocating society's scarce resources and lead to higher productivity and living standards.
" * Efficiency, however, does not guarantee fairness or justice in the allocation of incomes.
" * Fairness requires the government to redistribute income.
" * Markets systematically underprovide certain 'public goods' such as infrastructure, environmental regulation, education, scientific research.
" * The market is prone to financial instability, which can be alleviated through active government policies, including financial regulation and well-directed monetary and fiscal policies."
Another comment on detrimental side of the Reagan policies: "The main effect of the Reagan Revolution. . . . a new antipathy to the role of government, a new disdain for the poor . . . a new invitation to the rich to shed their moral responsibility, released greed more than entrepreneurial zeal."
Twenty years before Sachs wrote The Price of Civilization, a conservative Republican, Kevin Phillips, had seen the handwriting on the economic wall. The Politics of Rich and Poor documents the origins of the wealth gap between rich and poor due in large part to deliberate government policy.
For a liberal perspective on the decline, see Conscience of a Liberal by Paul Krugman.
By the way, neither Bush nor Clinton nor Bush nor Obama have done much to reverse the disastrous Reagan Revolution.
No comments:
Post a Comment