Has New York Times columnist Paul Krugman become an advocate of laissez-faire? Probably not. But if he carried his observations “On the Economics of Not Dying” (May 28) to their logical conclusion, he just might.

Krugman notes that economic growth is “just a means to an end, namely, improving the quality of life” — and that not being dead, rather than just not being poor, “also makes a major contribution to the quality of life.” Yet this seemingly common-sense observation cuts against much of his own economic theorizing.

In 2001, Krugman wrote that “the [9/11] terror attack — like the original day of infamy, which brought an end to the Great Depression — could even do some economic good … the economic slowdown has been a plunge in business investment. Now, all of a sudden, we need some new office buildings. As I’ve already indicated, the destruction isn’t big compared with the economy, but rebuilding will generate at least some increase in business spending.”

A decade later, Krugman looked to the skies to deliver the economic growth that 9/11 had failed to yield: “If we discovered that space aliens were planning to attack, and we needed a massive build-up to counter the space alien threat, and inflation and budget deficits took secondary place to that, this slump would be over in 18 months.”

This economic boost would hold even “if we discovered, oops, we made a mistake, there weren’t any aliens,” echoing classic science fiction stories in which similar ruses provided fabricated grounds for space programs and earthly cooperation before their long-term benefits materialized.  William Tenn, whose mid-1940s “Alexander the Bait” had one of the earliest such plots, noted in retrospect that while he had been correct to predict that the large-scale effort required to achieve spaceflight would require a concerted effort fueled less by lofty scientific idealism than remorseless self-interest, the motivation would not be “hoping to make a lot of money” but “hoping to make an awful lot of war.”

In a 1933 letter, John Maynard Keynes advised Franklin D. Roosevelt to use deficit spending in peacetime, and feel “free to engage in the interests of peace and prosperity the technique which hitherto has only been allowed to serve the purposes of war and destruction.”  As Robert Higgs explains, assuming that the ensuing military spending brought prosperity relies on the conflation of economic activity with human well-being decried by Krugman.

Yoda is as fictional as Krugman’s hypothetical invaders, but his aphorism that “wars not make one great” should caution historians whose lists of top political leaders are dominated by wartime presidents — and to those who would seek war, or its equivalent, to make the economy great.

New Yorker Joel Schlosberg is a contributing editor at The William Lloyd Garrison Center for Libertarian Advocacy Journalism.

PUBLICATION/CITATION HISTORY

• • “War is Not Good for the Economy or Living Things,” by Joel Schlosberg, River Cities’ Reader [Davenport, Iowa], 06/03/20
  • “War Is Not Healthy for the Economy and Other Living Things,”
    by Joel Schlosberg, Antiwar.com, 06/04/20
  • “War is Not Good for the Economy or Living Things,” by Joel Schlosberg, Ventura County, California Citizens Journal, 06/12/20

On two days in May fifty years ago, American police and National Guard troops fired their weapons into crowds of anti-Vietnam-War protesters, killing six American students at two American state universities.

On May 4, 1970 Ohio National Guard troops fatally wounded Allison Krause, Jeffrey Miller, Sandra Scheuer, and William Schroeder at Kent State University.

On May 15, officers of the Jackson, Mississippi Police Department and the Mississippi Highway Patrol killed Phillip Lafayette Gibbs and James Earl Green at historically black Jackson State.

The Report of the President’s Commission on Campus Unrest appointed by Richard Nixon to investigate the incidents concluded that “the indiscriminate firing of rifles into a crowd of [Kent State] students and the deaths that followed were unnecessary, unwarranted, and inexcusable” and that “the 28-second barrage of lethal gunfire [at Jackson State] was completely unwarranted and unjustified.”

In laying the theory for the modern nation-state as a bulwark against civil disorder, Thomas Hobbes insisted that its subjects retained “the liberty to disobey” orders “not to resist those that assault” them.

Yet while the 1970s would bring reductions in state power, with the cessation of the Vietnam War and its associated draft, such a right was never conceded in principle; the Commission recommended that “possession or use of weapons on campus by students should be strongly condemned” with no exceptions for self-defense. What the Commission called “the confidence of white officers that if they fire weapons during a black campus disturbance they will face neither stern departmental discipline nor criminal prosecution or conviction” was borne out.

While the Commission noted the discontent of those in higher education who “seek a community of companions and scholars, but find an impersonal multiversity,” it recommended increasing the role of state funding, which would effectively shift the leverage of power further away from the participants. As David Friedman noted at the time, “the lack of student power which the New Left deplores is a direct result of the success of one of the pet schemes of the old left, heavily subsidized schooling.”

The events of half a century ago serve as a reminder, as Voltairine de Cleyre observed a full century ago, that “the basis of all political action is coercion; even when the State does good things, it finally rests on a club, a gun, or a prison, for its power to carry them through.” Remembering our unvarnished history can revive such candor long before 2070.

New Yorker Joel Schlosberg is a contributing editor at The William Lloyd Garrison Center for Libertarian Advocacy Journalism.

PUBLICATION/CITATION HISTORY

• “Kent State, Jackson State, and The State,” by Joel Schlosberg, River Cities’ Reader [Davenport, Iowa], 05/13/20
• “Kent State, Jackson State, and the State,” by Joel Schlosberg. Antiwar.com, 05/15/20
• “Kent State, Jackson State, and the State,” by Joel Schlosberg, Ventura County, California Citizens Journal, 05/19/20

 

On April 18, the U.S. Small Business Administration’s Paycheck Protection Program lent out the last of $349 billion it had on hand in emergency funds. Efforts are underway to ensure that those billions will not be the Program’s last.

Meanwhile, others question whether small business should be saved. Paris Marx calls for nationalization of large companies rather than subsidization of smaller ones, asserting that if the handful of the former dominating the tech industry were replaced by the latter, “network effects would simply cause a re-monopolization in the future” (“Build Socialism Through the Post Office,” Jacobin, April 15).

However, the billions flowing through the SBA won’t match the trillions in bailout money for big business — or the indirect benefits to the latter that go unseen.

A decade before the Wall Street Journal reported that SBA funds are often “either too late in coming or won’t provide enough cash” for small businesses (“Small Businesses Opt To Close Despite Aid,” April 16), The Nation‘s Alexander Cockburn noted that “whatever backwash they got from the stimulus often wasn’t readily apparent” in the wake of the 2008 recession. They were being “stomped by regulators and bureaucrats while the big fry get zoning variances and special clause exemptions,” yet “the left disdains them.”

The manifesto of an earlier Marx argued that the support for small business still widespread among socialists at the time amounted “to cramping the modern means of production and of exchange within the framework of the old property relations that have been, and were bound to be, exploded by those means.”

Yet many of the industrial age’s biggest economic changes came from outside the gargantuan organizations that dominated it. Ralph Nader and Mark Green observed that “The firms which introduced stainless steel razor blades (Wilkinson), transistor radios (Sony), photocopying machines (Xerox), and the ‘instant’ photograph (Polaroid) were all small and little known when they made their momentous breakthroughs.”

The economic regulations enacted during America’s Progressive Era were what historian Gabriel Kolko called The Triumph of Conservatism rather than of Progressive (or Marxist) values, keeping the biggest competitors on top by shielding them from smaller upstarts. Kolko emphasized how the Federal Meat Inspection Act’s safety regulations went easier on large meatpackers, even if they engaged in riskier practices than smaller ones.

Peter Kropotkin related how the organizers of the English Lifeboat Association, “not being Jacobins, did not turn to the Government” that lacked “the co-operation, the enthusiasm, the local knowledge” of voluntary efforts. Kropotkin’s words inspired modern efforts to help out during emergencies like Occupy Sandy, and heeding them may save the economy of the 2020s.

New Yorker Joel Schlosberg is a contributing editor at The William Lloyd Garrison Center for Libertarian Advocacy Journalism.

PUBLICATION/CITATION HISTORY

• “Small Business Versus the State,” by Joel Schlosberg, Anchorage, Alaska Press, 04/18/20
• “Small Business Versus the State,” by Joel Schlosberg, River Cities’ Reader [Davenport, Iowa], 04/20/20
• “Small business versus the State,” by Joel Schlosberg, Creston [Iowa] News Advertiser, 04/21/20
• “Small Business Versus the State,” by Joel Schlosberg, Ventura County, California Citizens Journal, 04/23/20