MUST READ: Listening To Kate Raworth On Nine To Noon

By   /   March 15, 2019  /   9 Comments

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It is a tragedy that in the eighteen months this government has been in office there’s been so little evidence of the renegade economics made popular by writers like Raworth. The Finance Minister, Grant Robertson, schooled by his mentor – the former Finance Minister, Sir Michael Cullen – is a ploddingly orthodox economic manager. The economic settings he has chosen to steer by, being virtually identical to those the previous National Government chose to steer by, will inevitably deliver New Zealand to a very similar destination.

KATE RAWORTH calls herself a “renegade economist”, by which she means, I can only conclude, an economist who makes sense. If you’re keen to discover exactly how much sense, then read her book, Doughnut Economics: Seven Ways to Think Like a 21st Century Economist, or – better still – purchase a ticket to hear her speak at the Auckland Readers & Writers Festival on 13 May.

Listening to Raworth being interviewed by Kathryn Ryan on this morning’s (14/3/19) edition of Nine To Noon was a rare treat. RNZ has become such a timorous wee beastie these days; utterly determined to remain as inoffensive as possible to as many of its listeners as possible. So much so, that interviews with renegades of any sort are depressingly infrequent.

It would be encouraging to discover that Raworth was invited on Nine To Noon because Ryan is genuinely interested in discovering what might supplant the increasingly threadbare neoliberal economic paradigm which has, for more than three decades, relentlessly transformed New Zealand society.

Equally encouraging would be a “progressive” government peopled with Raworth devotees. A government chock-full of Labour, Green and NZ First politicians who all “get” the Oxford professor’s new economic thinking. Imagine party conferences and caucuses alive with debate about the best way of moving New Zealand out of its neoliberal capitalist present, and into a radically democratic eco-socialist future.

Why don’t we have such a government?

The answer is, in large measure, supplied by Raworth herself. She described to Ryan the peculiar narrowness of the economics discipline. As an economics student, not only was she never told the ultimate purpose of economics, but also, she and her fellow students were never encouraged to ask.

Like the rest of us, students are urged to look upon economics as a science. Its practitioners are charged with describing the laws of motion of economic reality. To demand to know the “purpose” of economics is as absurd as demanding to know the “purpose” of reality. Reality doesn’t have a purpose – it simply “is”. Economics just “is” too.

Except, of course, the “science” of economics isn’t a science at all. Political economy: the name people living in the nineteenth century gave to the many and often conflicting explanations of how the new phenomenon of industrial capitalism worked before these (minus those who prophesied its destruction) were codified and re-christened “economics”; was a much more honest intellectual exercise. Political economists at least recognised that how production, distribution and consumption are organised in any given society is both a reflection and an expression of who has the power – and who does not.

Raworth argues that the true purpose of economics under capitalism is to persuade people that who gets what is not decided by powerful individuals and groups but by the “law” of supply and demand. That the distribution of wealth and power is not guided by the all-too-obvious hands of the wealthy and the powerful (in which there is usually some sort of weapon) but by the “invisible hand” of the market. An agency as innocent of malign – or even conscious – intent as the weather.

Listening to Raworth respond to Ryan’s questioning, I was drawn to the conclusion that people either see through this attempt to hoodwink them into thinking that deciding who gets what is best left to the rational, utility-maximising and self-interested decision-making of homo economicus – or they don’t.

That conclusion led me, inexorably, to another: that all of the people who really matter in the present government are to be found among the hoodwinked. They just don’t “get” that the way an economy is run is the product of conscious political choice.

It is just about possible to forgive the members of NZ First for this failure. They are, after all, conservatives and therefore biased in favour of “organic” explanations of social relationships. There is, however, no excuse for Labour’s and the Greens’ failure to understand that they could change this country’s economic settings in a heartbeat – if they wanted to.

Labour, in particular, should grasp this. After all, it was the Fourth Labour Government which consciously, ruthlessly and radically changed New Zealand’s economic settings in 1984. They had help, of course: Treasury, the Reserve Bank, the Business Roundtable, most of the news media; all had a hand in the neoliberal transformation of New Zealand – and none of those hands were invisible.

It is a tragedy that in the eighteen months this government has been in office there’s been so little evidence of the renegade economics made popular by writers like Raworth. The Finance Minister, Grant Robertson, schooled by his mentor – the former Finance Minister, Sir Michael Cullen – is a ploddingly orthodox economic manager. The economic settings he has chosen to steer by, being virtually identical to those the previous National Government chose to steer by, will inevitably deliver New Zealand to a very similar destination.

Listening to her expound her renegade economics on Nine To Noon, I could only wonder what life in this country would be like if Kate Raworth was New Zealand’s finance minister. Compassionate, equitable, sustainable and, above all, radical.

As every progressive government should be.

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9 Comments

  1. Sam Sam says:

    There is so many economic theories out to argue over and nitpick what number to put where because I only want one economist, one writer, one story. That’s all I want and to challenge themselves and explain themselves. The argument is that there is only internal recognition that can be measured by an objective lens on the economy. An external lens is other people’s subjective perspective on the economy and a person, and a persons perceptions of the economy can always be subjective or wrong. There for the internal recognition is the only subjective measure of the biology of the economy. And we can actually subjectively measure whether or not people have straight testosterone or oestrogen stimuli when people are exerting there sweet, thought, and energy into the economy. So if I can internally recognise that a girl doing the job of a boy and vis a vis doesn’t automatically mean they are being oppressed or something because I understand that they can produce the same product under certain conditions. Other wise you’ve got these slick talkers going around trying to mess with the population with their words.

  2. Mike the Lefty says:

    Yes, I caught some of that interview and was impressed with the calibre of the interviewing and the answers.
    But it also struck a chord of frustration in the realisation that nothing is ever likely to change without a political revolution, and political revolution is not going to happen whilst the 1% own most of the world.

  3. WILD KATIPO says:

    [ ” After all, it was the Fourth Labour Government which consciously, ruthlessly and radically changed New Zealand’s economic settings in 1984. They had help, of course: Treasury, the Reserve Bank, the Business Roundtable, most of the news media; all had a hand in the neoliberal transformation of New Zealand

    I could only wonder what life in this country would be like if Kate Raworth was New Zealand’s finance minister. Compassionate, equitable, sustainable and, above all, radical ” ] …

    ——————————-

    Careful , Mr Trotter.

    Neo liberalism is a RADICAL economic ideology.

    It is NOT Orthodox, nor is it designed for the many, only the few.

    The old system was almost [ actually more or less was ] Keynesian. Social democratic Keynesian economics. That is what is missing in NZ today. That was THE NORM for NZ and many other country’s [Scandinavia ] in the West since at least World War Two. It was the system that took the world out of the Great Depression.

    It was the system this country prospered under and esp those who returned home from WW2. For nearly 60 years. THAT was Orthodoxy. Not radicalism such as the usurper neo liberalism / Lasse faire or the Austrian school of economics is. The ideology for the rich and the rich only.

    The ideology that promotes and locks into legislation the concept of modern serfdom and indentured servitude.

    Milton Freidman during those years would have had as much truck with New Zealanders as accepting slavery . It is just a sad fact that after the general election of 1984 NZ eventually capitulated to accepting being slaves to their new masters under neo liberalism.

    And that’s what we have become.

    Slaves to the Globalists.

    • Ada says:

      Should remember it was the failure of Keynesian economic policies that opened the door for the ideas and policies of Friedman to be adopted by Thatcher and Reagan.

      Their radical and transformative policies were opposed at the time during the 80s. But the ideas of the Mt Pellerin Society were seen as the only alternative to more of the same that was failing to lower unemployment, constrain inflation and deliver growth.

      • WILD KATIPO says:

        Oh for heavens sakes.

        Apologists like you for the neo liberal far right and the Rothchild’s backed Mont Pelerin Society need to be exposed.

        ——————————

        … ” A key point of the free-market cabal’s programme was to devalue the New Zealand dollar, an extremely sensitive issue. Several weeks before the July, 1984 election, Douglas, Labour’s shadow finance minister, “accidentally” released a statement which signaled his intent to devalue.

        Since it was a near certainty that labour, aided by the New Zealand Party’s drawing votes from the Nationals, would win, speculators began to dump the New Zealand dollar, planning, post-devaluation, to cash in each dollar of foreign currency for more New Zealand dollars than previously.

        With Labour’s victory, the simmering foreign exchange crisis exploded. The Reserve Bank’s foreign Exchange holdings quickly ran dry, and Labour demanded, even before the end of the several-week transition period, that Muldoon devalue. After a brief struggle, Muldoon capitulated, and devalued by 20%.
        Speculators made tens, if not hundreds of millions of dollars overnight ” …

        ——————————-

        AND MORE FROM THE SAME SOURCE…

        ——————————-

        …” Mont Pelerin shared the same “conservative revolution” philosophy as the Nazis. It also shared some of the same personnel.

        For instance, Max von Thurn und Taxis was a sponsor of von Hayek and his new society. Thurn und Taxis’ family had founded another society in southern Germany before World War 1, which was composed entirely of aristocrats, known as the Thule Society.

        Thule in turn formed a special “workers division” known as the “National Socialist German Workers Party” (NSDAP). The NSDAP, into which an Austrian corporal named Adolf Hitler was recruited, later became better known by the abbreviated version of its name, the “Nazis.”

        In 1989, Max von Thurn und Taxis attended a meeting of his Mont Pelerin Society in Christchurch, New Zealand, to judge, first hand, the results of the “worlds most radical free market revolution.”

        —————————–

        New Right Fight – Who are the New Right?
        http://www.newrightfight.co.nz/pageA.html

        Learn your history and who makes it. In this case regards the Mont Pelerin society and the NSDAP , – it was the aristocrats of Europe who virtually created NAZISM.

        You can stick your Mont Pelerin Society and Milton Freidman squarely where the sun don’t shine. And your Austrian school of Economics neo liberal version as well.

        And while you are at it, you can have along quiet reflection on WHY Scandinavia are the wealthiest nations on earth per capita WITHOUT neo liberalism.

        Go on, engage that little bit of grey matter between your ears for a change.

  4. Ada says:

    Just listened to the Nine to Noon interview, and would make these points.

    Raworth would be beaten in a debate by someone who knows a moderate amount of the history of economics. In fact, pretty much any articulate economist would be able to discredit her description of modern economics.

    Raworth creates a series of straw-man arguments to discredit developed economies and its thinkers. Is it relevant that Adam Smith was unmarried and living at home when he wrote “the Wealth of Nations”? Marx was supported by the wealthy Engel’s inheritance – is that just as (ir)relevant to Marx’s analysis?

    She continuously and deliberately confuses economic questions with political issues.

    Raworth is on much stronger ground when she says modern nations do not properly price the waste produced by society.

    Raworth will have a successful career popularising her criticism of mainstream economics but she won’t knock economics off its perch because it has too much strength and power as a useful predictive tool.

    • dennis dorney says:

      “It (presumably neo liberal economics) has too much strength and power as a useful predictive tool.” So why did all the neo-liberal economics fail to predict the 2008 crash, Ada? Why couldn’t any of them answer the question posed by the Queen when she asked “Did no one see this coming”
      Why was it left to renegade economists like Steve Keen to work it out?

      • John W says:

        It may be worth reading Henry George “Progress and Poverty”

        Every kiwi should he familiar with fellow Kiwi Bill Such’s ” Poverty and Progress”

        Too much money is made by a few in the debt finance system which is seldom a subject in public discussion.

        The study of Economics is carefully manicured to support BAU.

        Its crap!

    • John W says:

      The predictive tool of economics is devoid of reference to the real world of human decline.

      The environment has been trashed by “economic” arguments and the tool of economics if used to dissect and order reality to suit business as usual in a finite world.

      This is an impossible situation.

      Business as usual is a momentary delusion which demands continued destruction of our planet, more growth, more waste, more industrialisation, more people, more food, more soil, more fish. more energy, more infrastructure and buildings, more transport, but brings more poverty, more waste, less resources, less wilderness, less habitat for species, less community cohesion, less future for human civilisation and an extinction which is well underway.

      The “economy” tweaked wont address the malady of human stupidity.


 
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