The Challenge of Our Disruptive Era

Date: 23-04-2017
Source: The Wall Street Journal

It is arguably the largest economic transformation in recorded history. Can our politics adapt?

I am a historian, and that usually means I’m a killjoy. When people say we’re at a unique moment in history, the historian’s job is to put things in perspective by pointing out that there is more continuity than discontinuity, that we are not special, that we think our moment is unique because we are narcissists and we’re at this moment. But what we are going through now—the past 20 or 30 years, and the next 20 or 30 years—really is historically unique. It is arguably the largest economic disruption in recorded human history. And our politics are not yet up to the challenge.

There have been four kinds of economies: hunter-gatherers, agriculture (settled agrarian farmers in their villages), industry (mass urbanization and immigration), and whatever we’re entering now. Sometimes we call it the information-technology economy, the knowledge economy, the service economy, the digital economy. Sociologists call it the “postindustrial” economy, which is another way of saying “we don’t have anything to call it.”

What it really means is that jobs are no longer permanent. It used to be that you did whatever your parents and grandparents had done. Hunter-gatherers and farmers never even thought about it. There was no such thing as job choice, only becoming 7 and 10 and 12 years old and taking on more responsibilities to earn your keep.

Inequality and the world economy: True Progressivism

Absolutely essential: a very important topic for our society, good proposal for solutions! (hfk)

Date: 11-10-2012
Source: The Economist

A new form of radical centrist politics is needed to tackle inequality without hurting economic growth

BY THE end of the 19th century, the first age of globalisation and a spate of new inventions had transformed the world economy. But the “Gilded Age” was also a famously unequal one, with America’s robber barons and Europe’s “Downton Abbey” classes amassing huge wealth: the concept of “conspicuous consumption” dates back to 1899. The rising gap between rich and poor (and the fear of socialist revolution) spawned a wave of reforms, from Theodore Roosevelt’s trust-busting to Lloyd George’s People’s Budget. Governments promoted competition, introduced progressive taxation and wove the first threads of a social safety net. The aim of this new “Progressive era”, as it was known in America, was to make society fairer without reducing its entrepreneurial vim.

Modern politics needs to undergo a similar reinvention—to come up with ways of mitigating inequality without hurting economic growth. That dilemma is already at the centre of political debate, but it mostly produces heat, not light. Thus, on America’s campaign trail, the left attacks Mitt Romney as a robber baron and the right derides Barack Obama as a class warrior. In some European countries politicians have simply given in to the mob: witness François Hollande’s proposed 75% income-tax rate. In much of the emerging world leaders would rather sweep the issue of inequality under the carpet: witness China’s nervous embarrassment about the excesses of Ferrari-driving princelings, or India’s refusal to tackle corruption.