"The question is not only why the American working class family unraveled—even closer to the bone is why it took so long for anyone in the expert class to even notice."
Because the experts know that if they ask those questions, they may not like the answers they get.
So what happens is you get a Paul Krugman glibly explaining that inflation isn't really a problem, and producing very nice, very experty charts to demonstrate this quite convincingly, simply by taking out food, energy, housing and used cars (I mean, who uses any of those?) from the analysis, and voila! inflation isn't so bad!
Anyway, it is rich in Schadenfreude to watch liberals and democrats blame everyone and everything, everyone and everything but themselves and their policies.
Well written and interesting! Yes, the United States once had genuinely democratic governance structures, however imperfect and limited, fundamentally based around decentralized and publicly accessible mass-member parties. The Democratic Party, as a small "d" democratic institution, and the Republican Party, as a small "r" republican institution, were honest in their naming and functioned within a semi-politically, semi-economically, and semi-scientifically decentralized system. These parties, while far from flawless, allowed for real representation, meaningful participation, and a level of public accountability in both economic and political decision-making.
However, due to the dirty deeds of an assortment of powerful special interest groups, our parties have transformed into centralized, exclusionary membership organizations. The so called Democratic Party has become a technocracy party, and the so called Republican Party became a conservative party. Neither really represents their original principles of democracy or republicanism, and they dont offer meaningful access or representation to the public. This shift has been accompanied by a broader centralization of political, economic, and scientific decision making, which has caused the effective loss of most democratic governance structures.
However, a return to *real* political representation, in such a vast and inherently variable space as the as the USA, by decision, would 1) trigger a political and economic re-decentralization (which would be good!) and 2) would re-distribute influence and decision making, both of those things pose potential existential career/status threats to much of the elements that make up the *real* composition of the current party. So I would expect them to support it any time soon.
Also, while I broadly agree with your historical narrative, I would add four caveats that I thin are not just nuances but rather have substantial meaning:
1) the post war era may have been under Keynesian Macroeconomic management in some senses, but it was not in the way that European countries such as the UK were, this is because while the USA was on the the path towards centralization, during the 1950s, it nonetheless remained politically and economically decentralized, including in a great deal of, collectively very important, economic and scientific decision making
2) the Whiz Kids did clean up what were then, in some senses, relatively new organizations (DOD was created in 47) , but how much actual talent or skill did that require, because they had the backing to do it. But they also introduced a massive leveling up increase in structural corruption and opened up the door to the condition werre in today, also, there Vietnam debacle wasnt just a gamblers style doubling downs, they also repeatedly just did poor planning and dumb ideas ("the smartest guys in the room'. LMAO)
3) In my opinion, the inflation of the 1970s was primarily driven by supply constraints, including oil and metal shortages, increased demand from newly industrializing nations, and geopolitical factors such as resource withholding by developing countries. The inflation began trailing supply constraints and subsided once new supplies entered the market.
4) Has the central bank really done what we're told its done through skill? Or has it really been done by a broader system through domestic economic extraction in the form of suppressed wages, surpassed opportunity, suppressed investment, suppressed competition/economic activity, etc., coupled with a planetary economic empire that enables large perpetual budgets deficits, large perpetual trade deficits, and high liquidity all without inflation?
Thanks again for the interesting writing! Have a nice weekend. --Mike
Am I crazy or does this (fascinating and important) essay tell us that the era of smoke filled rooms and back room deals actually gave us more democratic governance?
If so, thanks. I have often thought this, albeit with much less justification. However, I think the billionaires would have bought those rooms and had their policy wonks running the show. No hope.
"The working class doesn't want redistributive center-left polities, they want populist predistributive ones."
So? What if that's true ... But also, what if the center-left avoids those kinds of policies because they have a terrible history and know they create more problems than they solve?
People's attempts to try to have sympathy for the despairing working class and understand their struggles might be causing those same people to overlook the possibility that what the working class wants might very well make their situations even worse. I don't believe democrats should make it a habit of adopting bad policies just because they're popular among the working class. If the working class wants populist predistributive policies, let them get it from the republicans. If that means democrats have to be in the minority for a while, then so be it. Let the republicans enact those policies for a while, and then after, as history has proven, they make things even worse, the republicans and their populist predistributive policies will get the blame and the democrats who avoided those policies can say, "Told ya."
"Postwar Keynesian macroeconomic management was geared towards generating high employment rates and wage growth to underwrite the class compact. But this generated systematic pressure towards price instability, eventually leading the Great Inflation that in turned opened the door to Volcker’s technocratic counter revolution and Reaganite attacks on labor power."
It only generates such pressure if supply is constrained and/or the money printer is turned too high. If supply of goods is diverted to a pointless war for a decade for instance while the President threatens the Fed Chairman into not raising rates. Or if the foreign policy elite decides to piss off the oil producing countries.
In other words, the breakdown of the Keynesian order has at least something to do with mismanagement by the "best and brightest." This brings up the question: are the elite even that good at their jobs?
Anyway, it's a good article but it's 15 years too late, the breach cannot be repaired now.
Note that we have a huge number of correlations and certainty about explanations--but they seem underdetermined.
Isn't the certainty that we'll get some master account of these peculiar and catastrophic choices misplaced? One reason I have come to distrust all these explanations because all the explanations tend to contain the explainers' wish lists and beliefs.
Another reason I distrust the explanations is that they don't leave enough room for irrationality. This is not to say that there is some class of people who IS rational, and the Trump voters are the only irrational ones. Simply that there is a lot of cleanup being done around people's choices--and no discussion of what people thought they were doing, and whether it's warranted.
But isn't there something strange about the assumption that the *explicit reasons* people give you for their own choice for why they voted that way (and there are an astonishing multiplicity of reasons but some factors jump out) do not count at all in the explanation? For example, people are always given very juicy promises by Trump, and also told a lot of lies--and we are somehow supposed to assume that these delicious promises, and these wild lies are irrelevant in the choices people make.
Instead, we are given substantive causes that it would be rational to act on--and these are supposed to explain the main reasons people had for acting. However, these are not the reasons those people seem to be aware of. Indeed, most people are completely unaware of the things which were supposedly driving their choice. What is foremost in their minds is not relevant somehow.
So there is a *real cause* that is driven by something that involves a choice, but the person making the choice is unaware of the real cause. Also, their choice is perfectly rational. They *should* react against this particular set of circumstances (many of which are proven by statistical measures they are unaware of) --and we assume this is what they did.
Left out is the fact that it wasn't a rational choice, in terms of the two options they are presented with. They are reacting to something from the past, not the future. They are making a choice which leads to a worse future. However, we have to assume that their choice is a rational reaction about the past--even if it neglects absolutely everyone *else* in their past that would be salient to remember about the Republicans. They only remember certain things about the Democrats, and their failures. (Indeed, they do remember some of these. But one has to wonder about the framing both they and others given to these memories, and why that is the framing. And also how intensely these would motivate people.)
Also, left out is how total the split is in each socioeconomic sector. For all the income groupings it appears the split is very close to half. The only income groups which went for Democrats in slightly higher numbers are those at the bottom and on the top. The most striking statistics seemed to be race, and rural/urban.
So are we over-interpreting? We could get some 'general continual discontent' that leads to Trump, not dissimilar to the general continual discontent that leads to Brexit (a strikingly similar event in some ways) --but pinning it down to very discrete causes in the longer history and socioeconomic landscape is a bigger task given what people believe they are doing.
It's still a good point to make that social and economic issues that deeply matter overall in the health and welfare of the population were ignored by the Democrats.
"The question is not only why the American working class family unraveled—even closer to the bone is why it took so long for anyone in the expert class to even notice."
Because the experts know that if they ask those questions, they may not like the answers they get.
So what happens is you get a Paul Krugman glibly explaining that inflation isn't really a problem, and producing very nice, very experty charts to demonstrate this quite convincingly, simply by taking out food, energy, housing and used cars (I mean, who uses any of those?) from the analysis, and voila! inflation isn't so bad!
Anyway, it is rich in Schadenfreude to watch liberals and democrats blame everyone and everything, everyone and everything but themselves and their policies.
Feature, not bug
Well written and interesting! Yes, the United States once had genuinely democratic governance structures, however imperfect and limited, fundamentally based around decentralized and publicly accessible mass-member parties. The Democratic Party, as a small "d" democratic institution, and the Republican Party, as a small "r" republican institution, were honest in their naming and functioned within a semi-politically, semi-economically, and semi-scientifically decentralized system. These parties, while far from flawless, allowed for real representation, meaningful participation, and a level of public accountability in both economic and political decision-making.
However, due to the dirty deeds of an assortment of powerful special interest groups, our parties have transformed into centralized, exclusionary membership organizations. The so called Democratic Party has become a technocracy party, and the so called Republican Party became a conservative party. Neither really represents their original principles of democracy or republicanism, and they dont offer meaningful access or representation to the public. This shift has been accompanied by a broader centralization of political, economic, and scientific decision making, which has caused the effective loss of most democratic governance structures.
However, a return to *real* political representation, in such a vast and inherently variable space as the as the USA, by decision, would 1) trigger a political and economic re-decentralization (which would be good!) and 2) would re-distribute influence and decision making, both of those things pose potential existential career/status threats to much of the elements that make up the *real* composition of the current party. So I would expect them to support it any time soon.
Also, while I broadly agree with your historical narrative, I would add four caveats that I thin are not just nuances but rather have substantial meaning:
1) the post war era may have been under Keynesian Macroeconomic management in some senses, but it was not in the way that European countries such as the UK were, this is because while the USA was on the the path towards centralization, during the 1950s, it nonetheless remained politically and economically decentralized, including in a great deal of, collectively very important, economic and scientific decision making
2) the Whiz Kids did clean up what were then, in some senses, relatively new organizations (DOD was created in 47) , but how much actual talent or skill did that require, because they had the backing to do it. But they also introduced a massive leveling up increase in structural corruption and opened up the door to the condition werre in today, also, there Vietnam debacle wasnt just a gamblers style doubling downs, they also repeatedly just did poor planning and dumb ideas ("the smartest guys in the room'. LMAO)
3) In my opinion, the inflation of the 1970s was primarily driven by supply constraints, including oil and metal shortages, increased demand from newly industrializing nations, and geopolitical factors such as resource withholding by developing countries. The inflation began trailing supply constraints and subsided once new supplies entered the market.
4) Has the central bank really done what we're told its done through skill? Or has it really been done by a broader system through domestic economic extraction in the form of suppressed wages, surpassed opportunity, suppressed investment, suppressed competition/economic activity, etc., coupled with a planetary economic empire that enables large perpetual budgets deficits, large perpetual trade deficits, and high liquidity all without inflation?
Thanks again for the interesting writing! Have a nice weekend. --Mike
"... for the same reason it took Case and Deaton 15 years to even notice that working-class Americans were killing themselves in despair."
Ditto the time it took Autor, Dorn, and Hanson to "discover"** the China shock: https://www.nber.org/papers/w21906
**discover translates as "make palatable to economists whose training is mainly math plus unspoken/unspeakable ideological premises"
Am I crazy or does this (fascinating and important) essay tell us that the era of smoke filled rooms and back room deals actually gave us more democratic governance?
If so, thanks. I have often thought this, albeit with much less justification. However, I think the billionaires would have bought those rooms and had their policy wonks running the show. No hope.
"The working class doesn't want redistributive center-left polities, they want populist predistributive ones."
So? What if that's true ... But also, what if the center-left avoids those kinds of policies because they have a terrible history and know they create more problems than they solve?
People's attempts to try to have sympathy for the despairing working class and understand their struggles might be causing those same people to overlook the possibility that what the working class wants might very well make their situations even worse. I don't believe democrats should make it a habit of adopting bad policies just because they're popular among the working class. If the working class wants populist predistributive policies, let them get it from the republicans. If that means democrats have to be in the minority for a while, then so be it. Let the republicans enact those policies for a while, and then after, as history has proven, they make things even worse, the republicans and their populist predistributive policies will get the blame and the democrats who avoided those policies can say, "Told ya."
https://open.substack.com/pub/matthewyglesias/p/the-deaths-of-despair-narrative-is?utm_source=share&utm_medium=android&r=7y2rb
"Postwar Keynesian macroeconomic management was geared towards generating high employment rates and wage growth to underwrite the class compact. But this generated systematic pressure towards price instability, eventually leading the Great Inflation that in turned opened the door to Volcker’s technocratic counter revolution and Reaganite attacks on labor power."
It only generates such pressure if supply is constrained and/or the money printer is turned too high. If supply of goods is diverted to a pointless war for a decade for instance while the President threatens the Fed Chairman into not raising rates. Or if the foreign policy elite decides to piss off the oil producing countries.
In other words, the breakdown of the Keynesian order has at least something to do with mismanagement by the "best and brightest." This brings up the question: are the elite even that good at their jobs?
Anyway, it's a good article but it's 15 years too late, the breach cannot be repaired now.
Note that we have a huge number of correlations and certainty about explanations--but they seem underdetermined.
Isn't the certainty that we'll get some master account of these peculiar and catastrophic choices misplaced? One reason I have come to distrust all these explanations because all the explanations tend to contain the explainers' wish lists and beliefs.
Another reason I distrust the explanations is that they don't leave enough room for irrationality. This is not to say that there is some class of people who IS rational, and the Trump voters are the only irrational ones. Simply that there is a lot of cleanup being done around people's choices--and no discussion of what people thought they were doing, and whether it's warranted.
But isn't there something strange about the assumption that the *explicit reasons* people give you for their own choice for why they voted that way (and there are an astonishing multiplicity of reasons but some factors jump out) do not count at all in the explanation? For example, people are always given very juicy promises by Trump, and also told a lot of lies--and we are somehow supposed to assume that these delicious promises, and these wild lies are irrelevant in the choices people make.
Instead, we are given substantive causes that it would be rational to act on--and these are supposed to explain the main reasons people had for acting. However, these are not the reasons those people seem to be aware of. Indeed, most people are completely unaware of the things which were supposedly driving their choice. What is foremost in their minds is not relevant somehow.
So there is a *real cause* that is driven by something that involves a choice, but the person making the choice is unaware of the real cause. Also, their choice is perfectly rational. They *should* react against this particular set of circumstances (many of which are proven by statistical measures they are unaware of) --and we assume this is what they did.
Left out is the fact that it wasn't a rational choice, in terms of the two options they are presented with. They are reacting to something from the past, not the future. They are making a choice which leads to a worse future. However, we have to assume that their choice is a rational reaction about the past--even if it neglects absolutely everyone *else* in their past that would be salient to remember about the Republicans. They only remember certain things about the Democrats, and their failures. (Indeed, they do remember some of these. But one has to wonder about the framing both they and others given to these memories, and why that is the framing. And also how intensely these would motivate people.)
Also, left out is how total the split is in each socioeconomic sector. For all the income groupings it appears the split is very close to half. The only income groups which went for Democrats in slightly higher numbers are those at the bottom and on the top. The most striking statistics seemed to be race, and rural/urban.
So are we over-interpreting? We could get some 'general continual discontent' that leads to Trump, not dissimilar to the general continual discontent that leads to Brexit (a strikingly similar event in some ways) --but pinning it down to very discrete causes in the longer history and socioeconomic landscape is a bigger task given what people believe they are doing.
It's still a good point to make that social and economic issues that deeply matter overall in the health and welfare of the population were ignored by the Democrats.