Harrington's "Socialism" (Part V)

What is it . . . ?

“It is of the capitalist essence to plan . . . “ — Michael Harrington

I’m trying to wrap up this series, after leaving the book home unfinished and going away for ten days, but I won’t finish the book today and I want to upload this draft. There will be one more shot at MH. He can take it.

It would be unfair, not to say stupid, to criticize someone for choosing to be a popularizer. It’s what I try to do. It’s what Michael Harrington chose to be, among other things. The question remains, what is he popularizing? You can only popularize what you know. What did he know?

The last sections of the book lay out Harrington’s socialist alternative(s) to what he calls “neo-capitalism.” The basis for the “neo” is MH’s theory that the system was trending towards collectivization, a capitalist form of planning. This was in 1970, and as I’ve noted, prediction is hard. Better men than Harrington, not least my idol John Kenneth Galbraith, envisioned planning under the command of corporations as well.

With the benefit of fifty years of hindsight, I still say no planning of any novel character has been visible. It’s still the Money Trust, which has been with us for well over a century. There is planning internal to corporations, including huge ones, but that hardly amounts to collectivization.

In a nutshell, the socialist calculation problem is how a corporation or public enterprise relates to other firms and to the market as a whole. Capitalism ingeniously solves that problem in a decentralized setting, always in unsatisfactory ways, but production and distribution of goods and services proceeds. MH thinks it is solved the socialist way, with democracy, or under the capitalist way of planning, with increasing collectivization under private control.

MH is on firmer ground when discussing planning in the context of urban problems and environmental concerns. He gets that the proliferation of what economists call “negative externalities” in cities elevates the salience of planning. He should be credited with foresight in proposing environmental interests as an important basis for socialism, though here I’m afraid he leans a bit on zero growth nostrums about running out of basic natural resources.

We’re always running out of resources. We find new ones, and we find ways, usually unfair ways, to economize and adjust. At one point MH says affluence creates its own problems. Beware of greenie attacks on mass consumption, and don’t tell me ‘we’ need to transfer consumption from the rich nations to the Global South. No country’s population will accept decreases in living standards.

MH equates increasing industrial concentration (e.g., monopoly) with environmental degradation. I’m afraid that concentrated or not, industry always degrades the environment. So could a socialist system, as MH admits. There is some inconsistency here. Sometimes MH deplores the anarchic nature of capitalism, especially in terms of public interests in environmental well-being, and other times he warily notes a trend towards capitalist planning borne of the aforementioned concentration.

MH’s preoccupation with brand-new cities is a little strange. He acknowledges it was a thing for the late and crooked Vice President Spiro Agnew, and to some extent the Nixon and Ford administrations. (More left than subsequent Democratic heroes.) It is tempting to think of solving problems with the benefit of a blank slate. A land without a people. Cities aren’t created or maintained that way. They are creatures of state governments, as hard-wired into the U.S. Constitution. You have to work with what you have. This is one of my pet peeves about the entire Left, not just MH; it is blind to Federalism.

Why do we need socialism? MH proposes three big reasons, though two of them amount to the same thing — more welfare state. (OK by me.) The third is the environmental field, mentioned above. None of that goes any deeper than liberal, mainstream economics. Nothing wrong with it, but I want more Marx.

Then there are a few lefty cliches.

“People before profits.” My jaundiced view of that line was discussed here. MH wants to criticize the Kennedy-style tax cuts, aimed at boosting national investment, because productivity does not expand “the power to consume.” Yes it fucking does. There are ways to skin this cat outside of the corporate sector, but capital formation and growth (properly measured) are good things.

Everything must be financed with a bigger progressive income tax? Sorry, that’s bad social-democratic tax policy. It’s not how they do it in the EU. With taxes, bigger is better, because the working class gets it back and more from public spending. Value-added taxes are the way to go, on top of a somewhat beefed-up income tax. Another of my long-standing pet peeves with the Left.

A very interesting question is raised by MH, referring to debates in the U.K. From harsh political experience, he relates British Labour judgements that the hoped-for transfer of resources from private to public sector, the enlarged welfare state, cannot fly politically unless private consumption can grow right along with it. In other words, the public sector can grow in no better than relative terms, not at the expense of any absolute increases in private consumption. I find this persuasive. It gives me a chance to tell one of my old stories.

As an EPI economist in the 1990s, I did a speech before some liberal trade unionists in Boston with the eminent Elaine Bernard. (She gives a dynamite speech, by the way.) I made my usual pitch on behalf of a tidal wave of public spending. It was a lead balloon. The guys weren’t having it. This was in “Taxachusetts”; they felt that their public spending was adequate, thank you very much.

More more stab at this, next week.