I don't think this is a steel-manning of the populist approach or a remotely adequate defense of the Neo-liberal approach because it very studiously avoids the issue of immigration.
Sure, there's some talk about tariffs and trade, but <b>the go to option in the populist "economic policy for the working class" playbook is "reduce unskilled (and especially unskilled illegal) immigration.</b>
The defense of neoliberalism is terribly weak because it doesn't acknowledge that nearly unconstrained immigration is a key tenent of liberalism. In many cases it's been made explicit that the "working class" to be helped is the foreign working class, because relative to them, the domestic working class is actually really well off.
This might be true, but as a policy preference, it's a pretty obvious FU to a domestic working class, an no amount of futzing about with sops on tariffs and labor taxes is going to offset it. This is the neoliberal policy that needs to change, because otherwise the vast majority of of the "neoliberal project" (which is good for all) is likely to get thrown out like the baby with the bathwater.
In short, neoliberal policy for the working class must start with consciously uncoupling the neoliberal policy that's admittedly anti-working class.
(I consider myself a liberal and I have no problem with this. In my study of liberalism as a political philosophy I've found nothing that suggests the absolutely poor foreigner should be preferred or invited into the polity at the expense of the only relatively poor citizen.)
I think we need to question the assumption that jobs for people without college degrees have disappeared entirely. Many have, but many others have been created that continually go unfilled. The trades, welding, manufacturing, truck driving, etc. all are short on workers. Drivers have been short for over 20 years now, and I have seen industry estimates that the market could readily absorb 33% more (for what that is worth). I have spoken with manufacturing companies that are increasing automation largely because they can't find workers to hire to do the work.
We can argue about whether or not labor prices need to increase to make supply meet demand, but especially in trucking the wages are getting nuts with 30$ an hour plus overtime being the median in most regions for local drivers. I think we need to seriously ask what people without college degrees are doing instead. What are they doing such that a job with pay over the national median is not worth it?
I suspect that the issue isn't so much the lack of jobs providing money and dignity, but rather what people consider dignified and what their other, non-work options are.
Given the increase in those attending college and the very low wages most of them make after 4 years, it suggests to me that as a culture we have decided that anything not requiring a college degree is a bad job, whether or not it pays more.
What are the non-work options for the millions out of the job market? What looks better than making >60K$ a year at a job?
Is there a neoliberal party pursuing the proposals you outline here? Is there a bill in congress that eliminates the payroll tax? I thought the big neoliberal tax proposal being debated now was how big a SALT deduction the neoliberals were going to give themselves?
Invade the world.
Invite the world.
Indebted to the world.
That's what neoliberalism means to me. Maybe it's my own definition, but if neoliberalism means something like "the current ruling consensus in the west" then its pretty accurate.
Such a consensus doesn't really have a tax or economic policy beyond "entrenched interests in capital and the bureaucracy should do better whatever a toll that takes on anyone else". Print money you don't have and give it to buddies, OK. Subsidize demand and restrict supply, OK. You might say that neoliberalism is about who is on the inside of those grifts and who is on the outside. We restrict the supply of doctors, but not fruit pickers. Etc.
Freddie deBoer implies here that neoliberalism could help create universal health coverage. This is not a material point in the jobs debate, but I do want to call it out as misleading. Universal health coverage can only be created with some type of coercion.
Whether the coercion is an insurance mandate, or higher taxes for expanding Medicare and Medicaid, or the regulation of prices for emergency rooms, drugs, and devices -- it still requires new laws and regulations.
Populism should be a goal and neoliberalism a means. Populism doesn't have much interesting to say on policy design, other than to remind us that policy should benefit the most people. Neoliberalism doesn't have much to say about policy goals - free markets is not goal but a means to achieve the goal of human prosperity.
Unfortunately proponents of populism and neoliberalism think they are both means and goals, often with bad effect. We can optimistically hope that a balance of power between the two can avoid this mistake of each.
Sorry, Arnold. I laugh at all those critical of neoliberalism (including one of my daughters in a book published by MIT press --of course, it's not dedicated to her dear daddy). I laugh because they never attempted to understand the economic history of the several countries whose governments were accused of implementing neoliberalism. The "neoliberal" response to economies in shambles shouldn't be a surprise because the crises which precipitated the response were just symptoms of "structural" problems caused by the heavy government intervention. Either in Chile post-1975 (not post-1973) or in China post-Mao and especially post-1992, there was only one way out of those problems: to get rid of most of that intervention. But neither Chile nor China became "neoliberal" economies because of politics.
Arnold, I think you should laugh with me about those that insist writing about neoliberalism but have no idea of why "neoliberal" revolutions were inevitable to get out of crises and why their success has been so limited. I'm ready to discuss the experience of most countries that in the past 50 years have gone through at least one "neoliberal" revolution. BTW, I lived and worked in Chile during 1973-84, I returned in 1999, and now I live in Santiago. Also, I lived and worked in Beijing and Hong Kong 1994-97, and I have continued analyzing their experiences. Indeed, the China shock to the world economy is the outcome of the greatest "neoliberal" revolution of the past 50 years, and unfortunately, it may not end well.
Finally, populism has been discussed for decades (centuries?) and it has accompanied the "neoliberal" revolutions in some LA countries. I consider it a political response to economies in shambles. I was born and raised in Argentina where populism was discussed and promoted by the two major political coalitions in 1951 and today is still discussed by the two major political coalitions.
"Roundabout production that includes workers from other countries" is generally a good idea when those other countries are broadly values-aligned and can be trusted to stay that way. However, the picture gets more complicated when another country might defect, and the defection is of large enough scale to really matter. That problem has diplomatic, not just economic, elements to it.
Your fix for fixing the 'average' that's 'supposed to be over' job market is correct directionally. Even if some sort of industrial policy were to be developed and adopted, you would need to do that anyway. Our tax and entitlement systems can't be defended intellectually, but they are also politically invincible.
I also identify as neoliberal, but Kiing's version does not actually go far enough in the "perusing" of progressive ends with market-friendly means. He's on strong grounds in suggesting that we should eliminate the caped wage tax as a way of financing Social Security and subsidized health insurance in favor of (which he does not say) a VAT, which would be more progressive and les subject to the vagaries of demographic change and the business cycle.
And neoliberals were never supposed to be opposed to "regulation," only regulation that does not pass cost benefit analysis and to replace regulation of externalities with taxation in many places, first of all in reducing net emissions of CO2 into the atmosphere.
But not taxing income originating from capital is bonkers. We could eliminate some of the silly ways of taxing income from capital (taxing business income AND dividends by eliminating business income taxation and imputing income to owners and by indexing capital gains).
We could also do more to make our sort of progressive income tax into a sort of progressive consumption tax by increasing deductions (here is one place that a deduction rather than a partial tx credit actually makes sense) for "retirement" savings. But all these changes need to go hand in hand with making the tax system more progressive and eliminating the structural deficit.
I don't think this is a steel-manning of the populist approach or a remotely adequate defense of the Neo-liberal approach because it very studiously avoids the issue of immigration.
Sure, there's some talk about tariffs and trade, but <b>the go to option in the populist "economic policy for the working class" playbook is "reduce unskilled (and especially unskilled illegal) immigration.</b>
The defense of neoliberalism is terribly weak because it doesn't acknowledge that nearly unconstrained immigration is a key tenent of liberalism. In many cases it's been made explicit that the "working class" to be helped is the foreign working class, because relative to them, the domestic working class is actually really well off.
This might be true, but as a policy preference, it's a pretty obvious FU to a domestic working class, an no amount of futzing about with sops on tariffs and labor taxes is going to offset it. This is the neoliberal policy that needs to change, because otherwise the vast majority of of the "neoliberal project" (which is good for all) is likely to get thrown out like the baby with the bathwater.
In short, neoliberal policy for the working class must start with consciously uncoupling the neoliberal policy that's admittedly anti-working class.
(I consider myself a liberal and I have no problem with this. In my study of liberalism as a political philosophy I've found nothing that suggests the absolutely poor foreigner should be preferred or invited into the polity at the expense of the only relatively poor citizen.)
I think we need to question the assumption that jobs for people without college degrees have disappeared entirely. Many have, but many others have been created that continually go unfilled. The trades, welding, manufacturing, truck driving, etc. all are short on workers. Drivers have been short for over 20 years now, and I have seen industry estimates that the market could readily absorb 33% more (for what that is worth). I have spoken with manufacturing companies that are increasing automation largely because they can't find workers to hire to do the work.
We can argue about whether or not labor prices need to increase to make supply meet demand, but especially in trucking the wages are getting nuts with 30$ an hour plus overtime being the median in most regions for local drivers. I think we need to seriously ask what people without college degrees are doing instead. What are they doing such that a job with pay over the national median is not worth it?
I suspect that the issue isn't so much the lack of jobs providing money and dignity, but rather what people consider dignified and what their other, non-work options are.
Given the increase in those attending college and the very low wages most of them make after 4 years, it suggests to me that as a culture we have decided that anything not requiring a college degree is a bad job, whether or not it pays more.
What are the non-work options for the millions out of the job market? What looks better than making >60K$ a year at a job?
Is there a neoliberal party pursuing the proposals you outline here? Is there a bill in congress that eliminates the payroll tax? I thought the big neoliberal tax proposal being debated now was how big a SALT deduction the neoliberals were going to give themselves?
Invade the world.
Invite the world.
Indebted to the world.
That's what neoliberalism means to me. Maybe it's my own definition, but if neoliberalism means something like "the current ruling consensus in the west" then its pretty accurate.
Such a consensus doesn't really have a tax or economic policy beyond "entrenched interests in capital and the bureaucracy should do better whatever a toll that takes on anyone else". Print money you don't have and give it to buddies, OK. Subsidize demand and restrict supply, OK. You might say that neoliberalism is about who is on the inside of those grifts and who is on the outside. We restrict the supply of doctors, but not fruit pickers. Etc.
Freddie deBoer implies here that neoliberalism could help create universal health coverage. This is not a material point in the jobs debate, but I do want to call it out as misleading. Universal health coverage can only be created with some type of coercion.
Whether the coercion is an insurance mandate, or higher taxes for expanding Medicare and Medicaid, or the regulation of prices for emergency rooms, drugs, and devices -- it still requires new laws and regulations.
Populism should be a goal and neoliberalism a means. Populism doesn't have much interesting to say on policy design, other than to remind us that policy should benefit the most people. Neoliberalism doesn't have much to say about policy goals - free markets is not goal but a means to achieve the goal of human prosperity.
Unfortunately proponents of populism and neoliberalism think they are both means and goals, often with bad effect. We can optimistically hope that a balance of power between the two can avoid this mistake of each.
Sorry, Arnold. I laugh at all those critical of neoliberalism (including one of my daughters in a book published by MIT press --of course, it's not dedicated to her dear daddy). I laugh because they never attempted to understand the economic history of the several countries whose governments were accused of implementing neoliberalism. The "neoliberal" response to economies in shambles shouldn't be a surprise because the crises which precipitated the response were just symptoms of "structural" problems caused by the heavy government intervention. Either in Chile post-1975 (not post-1973) or in China post-Mao and especially post-1992, there was only one way out of those problems: to get rid of most of that intervention. But neither Chile nor China became "neoliberal" economies because of politics.
Arnold, I think you should laugh with me about those that insist writing about neoliberalism but have no idea of why "neoliberal" revolutions were inevitable to get out of crises and why their success has been so limited. I'm ready to discuss the experience of most countries that in the past 50 years have gone through at least one "neoliberal" revolution. BTW, I lived and worked in Chile during 1973-84, I returned in 1999, and now I live in Santiago. Also, I lived and worked in Beijing and Hong Kong 1994-97, and I have continued analyzing their experiences. Indeed, the China shock to the world economy is the outcome of the greatest "neoliberal" revolution of the past 50 years, and unfortunately, it may not end well.
Finally, populism has been discussed for decades (centuries?) and it has accompanied the "neoliberal" revolutions in some LA countries. I consider it a political response to economies in shambles. I was born and raised in Argentina where populism was discussed and promoted by the two major political coalitions in 1951 and today is still discussed by the two major political coalitions.
"Roundabout production that includes workers from other countries" is generally a good idea when those other countries are broadly values-aligned and can be trusted to stay that way. However, the picture gets more complicated when another country might defect, and the defection is of large enough scale to really matter. That problem has diplomatic, not just economic, elements to it.
Your fix for fixing the 'average' that's 'supposed to be over' job market is correct directionally. Even if some sort of industrial policy were to be developed and adopted, you would need to do that anyway. Our tax and entitlement systems can't be defended intellectually, but they are also politically invincible.
I also identify as neoliberal, but Kiing's version does not actually go far enough in the "perusing" of progressive ends with market-friendly means. He's on strong grounds in suggesting that we should eliminate the caped wage tax as a way of financing Social Security and subsidized health insurance in favor of (which he does not say) a VAT, which would be more progressive and les subject to the vagaries of demographic change and the business cycle.
And neoliberals were never supposed to be opposed to "regulation," only regulation that does not pass cost benefit analysis and to replace regulation of externalities with taxation in many places, first of all in reducing net emissions of CO2 into the atmosphere.
But not taxing income originating from capital is bonkers. We could eliminate some of the silly ways of taxing income from capital (taxing business income AND dividends by eliminating business income taxation and imputing income to owners and by indexing capital gains).
We could also do more to make our sort of progressive income tax into a sort of progressive consumption tax by increasing deductions (here is one place that a deduction rather than a partial tx credit actually makes sense) for "retirement" savings. But all these changes need to go hand in hand with making the tax system more progressive and eliminating the structural deficit.