The big critique of what most of us think of as economics in the academy is called Critical Theory. Like a lot of socialism it’s basically elitist and is really a snide reflection on ADMASS. I’m not an adherent, but read a lot of the stuff and its postmodern equivalents before I finally realised these academics had resigned from doing anything about the chronic power relations of everyday life other than to talk amongst themselves. The real problem is that we just can’t get most people up to speed in rational argument – something that has failed even in those countries that have had universal education for 80 years or so.
I watched an idiot woman on Newsnight last night who kept saying it was all right to pay people buttons for working in supermarkets because there is a need to keep wages low in order to have a low unit cost economy. The eventual upshot of this ‘argument’ is that countries need to compete on the basis of driving wage costs down – with the obvious final position being the creation of subsistence level serfdom if such workers can’t do anything to improve their lot through collective bargaining.
When wage costs are driven down by sending the work to China and other sweatshops, about $40 is ‘saved’ on a $600 piece of kit. This isn’t the end of the matter as we find most companies doing this, like Apple, also keep very sizeable chunks of their profits offshore to evade corporation tax. The original host economy loses the jobs and tax. The idea is that this competition will spur those in the original host economy to do smarter work like financial services, design and so on.
Without needing explanation, it seems obvious that we need to know what smart work is in order to believe any of this and such matters as who can do it. The standard blandishment is that education will provide the people – yet education is not much use in converting people from not very bright to bright. And financial services are turning out to be costly and not very smart work anyway. Indeed the model appears to be legalised fraud.
The issues are not complex. We are collectively dumb.