Sinead, I am ever impressed by the clarity of your analyses -- Thank you!! I wonder if Milanović read John Kenneth Galbraith's, The New Industrial State, which is largely the lense through which I have been watching the past 20-30 years unfold. In line with the thesis of Galbraith's book, I think the US government was an active participant (rather than a passive observer) in accelerating inequality through their policies that rewarded offshoring of jobs (tax write-offs for "restructuring"), among other decisions. How does Milanović propose billionaires and MegaCap corporations be taxed to redistribute wealth post Citizen's United? #Welcometotheoligopoly
- Markets have rules. The rules evolve and need enforcement. The markets only decide inasmuch as the rules guide their participants. Governments have a role, both with rule-making and enforcement, and not just in financial markets. That's the job that we pay them taxes to do.
Thanks for reading Pierre. And I've actually been to Haarlem and seen that! "That's the job we pay them taxes to do", indeeeed. We don't just pay for "outcomes" à la healthcare or education, we also pay for "services" à la coordination.
I really enjoyed reading this, agreed with some of the points whilst ultimately disagreeing with the conclusions. I think that government is not suited to coordinate actions as it quickly gets captured by special interests that want protection. I thing government can do is to ensure that our laws are business friendly in order to to keep businesses competitive and to reduce labour market frictions to make it easier for new companies to be created and more people to be employed.
Hey there! So IMO the choice is not exactly between “free markets” and “captured government.” Not having coordination doesn't necessarily eliminate capture, it just relocates capture-dynamics into the private sector where it scales faster without oversight. I kind of wrote about this here! https://www.butthistime.com/p/how-to-fix-a-crackhead-economy-addicted-323
Superb writing as always. I fully agree that as a matter of object analysis the kind of implicit assumption you describe perfectly is there and as a result, constrain our thinking about the nature of the problem.
However, when I think about what is feasible in terms of action, I feel a bit torn. On one hand, simple redistribution seems easier to implement, although the institutional hollowing-out you have mentioned makes it politically impossible to implement at a scale required. But on the other hand, coming up with a set of common objectives for consistent industrial policies/coordination seems politically too difficult in most Western countries.
In short, perhaps one could argue that redistribution may not be the right remedy for the underlying problem but the right first step towards creating conditions for the right remedy?
Sinead, I am ever impressed by the clarity of your analyses -- Thank you!! I wonder if Milanović read John Kenneth Galbraith's, The New Industrial State, which is largely the lense through which I have been watching the past 20-30 years unfold. In line with the thesis of Galbraith's book, I think the US government was an active participant (rather than a passive observer) in accelerating inequality through their policies that rewarded offshoring of jobs (tax write-offs for "restructuring"), among other decisions. How does Milanović propose billionaires and MegaCap corporations be taxed to redistribute wealth post Citizen's United? #Welcometotheoligopoly
Excellent writing!
I just want to mention two additional angles One, as a troubleshooter:
- Look for the source of the problem, fix that, then clean up. If the dam is leaking, fix the dam! You can worry about buckets later. Obligatory legend: https://time.com/archive/6796274/the-netherlands-the-hero-of-haarlem/
The other one, as someone involved with trading:
- Markets have rules. The rules evolve and need enforcement. The markets only decide inasmuch as the rules guide their participants. Governments have a role, both with rule-making and enforcement, and not just in financial markets. That's the job that we pay them taxes to do.
Thanks for reading Pierre. And I've actually been to Haarlem and seen that! "That's the job we pay them taxes to do", indeeeed. We don't just pay for "outcomes" à la healthcare or education, we also pay for "services" à la coordination.
I really enjoyed reading this, agreed with some of the points whilst ultimately disagreeing with the conclusions. I think that government is not suited to coordinate actions as it quickly gets captured by special interests that want protection. I thing government can do is to ensure that our laws are business friendly in order to to keep businesses competitive and to reduce labour market frictions to make it easier for new companies to be created and more people to be employed.
Hey there! So IMO the choice is not exactly between “free markets” and “captured government.” Not having coordination doesn't necessarily eliminate capture, it just relocates capture-dynamics into the private sector where it scales faster without oversight. I kind of wrote about this here! https://www.butthistime.com/p/how-to-fix-a-crackhead-economy-addicted-323
Wow! Thank you! This was an error in my own thinking that I wasn’t previously aware of.
Thank you for taking the time to read it!
Superb writing as always. I fully agree that as a matter of object analysis the kind of implicit assumption you describe perfectly is there and as a result, constrain our thinking about the nature of the problem.
However, when I think about what is feasible in terms of action, I feel a bit torn. On one hand, simple redistribution seems easier to implement, although the institutional hollowing-out you have mentioned makes it politically impossible to implement at a scale required. But on the other hand, coming up with a set of common objectives for consistent industrial policies/coordination seems politically too difficult in most Western countries.
In short, perhaps one could argue that redistribution may not be the right remedy for the underlying problem but the right first step towards creating conditions for the right remedy?