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THE PROFESSOR SPEAKS

October 28, 2016
  1. THE PROFESSOR SPEAKS

    Sheila Kennedy, a professor at IUPUI, Indianapolis, publishes a daily blog on various topics of interest involving economics and government (which happens to be my area of interest) and solicits commentary from others on what she has written. Typically she will get 20 to 30 responses, and I frequently am among that number. She recently gave an excellent speech to the Economics Club at Ball State University, Muncie, Indiana, fashioned it into her daily blog and published it, seeking commentary. I responded and have since decided that my response could be blogged as well, so slightly edited, here it is.

    Bravo at your macro look at the sound and fury of where economics intersect with government! You nailed it! This noisy intersection was a pre-Enlightenment mess and continues to be one today what with new opportunities to do mischief for profit by getting a leg up on the competition by hook or crook, patent manipulation, monopoly pricing, bribes (aka “campaign contributions”), trashing the environment etc.

    The cognitive brain scientist George Lakoff in his book, The Political Mind, deals with one aspect of this continuing understanding or misunderstanding of free market philosophy at its intersection with the public interest. As summarized, he notes that government is involved in protection and empowerment of its citizens and then gives us an example how that works (or should work).

    He writes: “Corporations make use of government empowerment more than ordinary citizens. I drive my car on freeways; corporations send out fleets of trucks. I get a bank loan for my house; corporations get loans to buy other corporations. Corporations thus make compound use of government empowerment, and that is why they – and their investors – should be paying more, not less, than ordinary citizens of this country.” (Try selling that to Wall Street or the libertarian Brothers Koch in Wichita, Professor Lakoff! Good luck!)

    Lakoff is talking about taxes, of course, but there are many other areas wherein government (via political shenanigans) offers more protection and empowerment to corporations than to ordinary citizens, the latest atrocity being that of redefining corporations as “persons” by the Supreme Court, which I suppose could result in a fanciful conversation such as “Mr. Goodyear, meet Ms. General Electric. Let’s talk merger.”

    I understand that as we go along we must redefine the terms and conditions of sustaining a market-based economy in some sort of balance with the public interest and still enjoy some of the blessings of democracy, but I hope that humanizing corporations for business and political purposes by courts is as far as we go since at the present and accelerated rate of innovation the next stop for creative economics could at least theoretically involve only corporations and robots in the provision of goods and services, a process in which humans are mere onlookers and where democratic values, free markets and other such former points of contention become quaint if not obsolete as the tidal wave of innovation takes us into new territory never contemplated by the Founders – or even us. Can’t happen? That’s what we were told about Dick Tracy’s two-way radio.

    How can we know where ones and zeroes will take us? We can’t at this juncture, of course, but we have to have economies and governments that work for all of us between now and that day (if and when it comes). Our current economy is underperforming and not serving us well due to wage inequality with median wages and aggregate demand at a virtual standstill. These are situations we can correct if we have the will to do so, but it will take more than talk to overcome the status quo represented by moneyed interests. Among other things, and since reform can only come through a political process, it is extremely important that we elect a Congress that will do what is necessary to make our economy perform for all of us and not just the few with deep pockets who provide campaign cash to keep the rest of us in servitude, so at a minimum I urge all who read this to VOTE.     GERALD        E
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