Video: Finance and Decarbonization

Here is a roundtable hosted by the Jain Family Institute on finance and decarbonization.

What’s the best way to fund the massive investments the green transition will require? Saule Omarova and Bob Hockett make the case for a specialized National Investment Authority (NIA), which would issue various kinds of new liabilities as well as lend to both the public and private sector. Anusar Farooqui and Tim Sahay present their proposal for a green ratings agency, to encourage private investment in decarbonization. I speak for the Green New Deal approach, which favors direct public spending. Yakov Feygin and Daniela Gabor also take part. Yakov is another voice for the NIA, while Daniela criticizes a private finance-based approach to decarbonization, which effectively puts her with me on team Green New Deal. The panel is moderated by Adam Tooze.

My part starts at around 38:00, if you want to skip to that, but the whole thing is worth watching.

 

Video: Monetary Policy since the Crisis

On May 30, I did a “webinar” with INET’s Young Scholar’s Intiative. The subject was central banking since the financial crisis of a decade ago, and how it forces us to rethink some long-held ideas about money and the real economy — the dstinction between a demand-determined short run and a supply-determined long run; the neutrality of money in the long run; the absence of tradeoffs between unemployment, inflation and other macroeconomic goals; the reduction of monetary policy choices to setting a single overnight interest rate based on a fixed rule.My argument is that the crisis — or more precisely, central banks’ response to it — creates deep problems for all these ideas.

The full video (about an hour and 15 minus, including Q&A) is on YouTube, and embedded below. It’s part of an ongoing series of YSI webinars on endogenous money, including ones by Daniela Gabor, Jo Mitchella nd Sheila Dow. I encourage you, if you’re interested, to sign up with YSI — anyone can join — and check them out.

I didn’t use slides, but you can read my notes for the talk, if you want to.

Liza Featherstone on Focus Groups

Yesterday, we at the John Jay Economics Department hosted my friend Liza Featherstone, author of Students Against Sweatshops and Selling Women Short: The Landmark Battle for Workers Rights at Wal Mart, for a talk about her new book, on the history and politics of focus groups. (That’s me introducing her.)

The whole thing is worth watching. As with so many institutions, the history of the focus group has interesting twists and turns that you wouldn’t guess just from its current state. I hadn’t realized, for example, that the focus group originated — like so many technologies — in the US war effort of the 1940s. The first focus groups, apparently, were convened to improve the quality of radio propaganda. Only later was the technique adopted by commercial advertising, before migrating into the electoral arena in the 1980s and 1990s.

The most interesting part, though — for met at least — is the end, where Liza talks about the funny parallels between focus groups and the kind of consensus decision making practiced by mass movements like Occupy. (And by popular movements at least back to the 18th century, for that matter.) In contrast to surveys, polls and elections, focus groups and assemblies do not assume that people enter the process with well-formed views that just have to be registered and tallied. Instead, they assume that people’s true views only emerge in a process of active exchange with others.

The classic example in the marketing context is New Coke. In blind tests, clear majorities preferred the new flavor, but in a setting where the two cokes were discussed, people were somehow convinced that they preferred the old flavor after all. Apparently focus groups sponsors often complain in cases like this that one strong personality bullies everyone else. But isn’t that how people’s choices get shaped in the rest of life too?

Is it better to keep our private views intact? There’s a view that instability in asset markets arises precisely because people allow their views to be shaped by interaction with others — herd behavior, the madness of crowds. To have efficient asset markets, it’s important that people trade on their private information. We use secret ballots in elections and some people even consider it rude to ask who you are voting for. Too much discussion corrupts the process of aggregating up private beliefs. More generally, there’s a sense that the way our ideas change in contact with others can be a problem, and that we may need to protect our authentic selves from social pressures.

To love you must have someone else,
Giving requires a legatee,
Good neighbours need whole parishfuls
Of folk to do it on — in short,
Our virtues are all social; if,
Deprived of solitude, you chafe,
It’s clear you’re not the virtuous sort. 

Viciously, then, I lock my door.
The gas-fire breathes. The wind outside
Ushers in evening rain. Once more
Uncontradicting solitude
Supports me on its giant palm;
And like a sea-anemone
Or simple snail, there cautiously
Unfolds, emerges, what I am.

That’s Larkin, who would not have had much time for either focus groups or general assemblies.

Meanwhile, on the other side, along with the focus groups we have 12-step groups, psychoanalysis, the self-criticism practiced in some revolutionary groups. All of these elevate the process of communication itself as the source of beliefs and desires, as opposed to the liberal idea that we first come into possession of these individually and then act on them or communicate them.

What do we make of this similarity? The negative answer is that focus-group politics have displaced more effective forms of political organization on the left as well as in the mainstream. People have come to feel that communication is an end in itself — that the important thing is to have your voice heard, and only incidentally to exercise power. (Liza shared a rather depressing anecdote after the talk, about a union staffer who said that it was impossible to get members to come to meetings by saying there would be an important vote, but they would come if you told them they’d be taking part in a focus group.) Of course even this way of looking at things isn’t entirely negative — people do need to get their voices heard, especially people without the privileges that make it easy to be listened to.

But there’s another way to look at these parallels. Maybe the marketers, in their desperation to “catapult the propaganda” (in the words of one of our most focus-grouped, and focus group-deriding, politicians) have stumbled on a truth about human nature that the left has always known. We are not monads, with a fixed set of preferences. As Liza says in the talk, human beings are profoundly social creatures — our selves don’t exist in isolation from others. (This is why solitary confinement is a form of torture.) Capitalism is intolerable but it has, historically, produced genuine progress in science and technology, and there’s a sense in which focus groups could be an example. It’s grotesque that this insight — that people’s beliefs and desires only emerge in exchange with others — has been mainly used to sell soft drinks and candidates. But it’s a real insight nonetheless.

Louis Liked It

 Last weekend was the Left Forum. I’ve been going to these things for years and years, since they were the Socialist Scholars Conference, and it must be said they have gotten much better in recent years. Many more younger people, many fewer undersocialized fossil Trotskyists. (Some of my best friends are…) This year, felt especially good As Doug Henwood said on Facebook, “The sessions were good, especially the discussions – but the major difference was that Occupy made it feel like it actually mattered.”

I was on two panels with some UMass comrades, one on the New Deal and whether we want a new one, and one on whether finance specifically is the enemy. Louis Proyect caught most of the former on tape and, gratifyingly, says it was the best one he went to. Tho he says I work at William Patterson University, which I’ve never even heard of, and says I was calling for a new New Deal, which I don’t think I really was. But judge for yourself: here’s the video.