Category Archive: Interviews

  1. Resource Nationalism and Decarbonization

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    Across Latin America, a string of recent left-wing electoral victories has drawn comparisons to “Pink Tide” of the early 2000s. The Pink Tide took place in the context of a global commodities boom. The current moment, however, coincides with a global push towards decarbonization, and much of the world’s supply of commodities essential to that transition—most prominently lithium—are found in the region. How will these new left governments navigate this frontier of resource extraction?

    Already, President López Obrador nationalized Mexico’s lithium supply in April; Colombian President-elect Gustavo Petro recently declared an anti-fracking stance while supporting boosted investment in a green transition. Heated debates have emerged regarding the role of state in resource development, the use of resource revenues in national development strategy, and the environmental and social harms of mining for frontline communities, especially Afro and indigenous groups.

    In July, a Phenomenal World panel discussed these ongoing debates, probing the current and future status of resource nationalism from Mexico to the Southern cone. A recording of the event can be seen here. The transcript was edited for length and clarity.

    A conversation on resource nationalism in Latin America

    ALEX YABLON: As the global push to decarbonize accelerates, however haltingly, there’s mounting pressure on countries that produce an outsized share of the commodities essential to that transformation. In Latin America, growing demand for metals like lithium and copper has simultaneously increased the ambition of the new generation of left-wing political leaders eager to assert sovereignty over natural resources, while dividing the same politicians’ own coalitions over how to balance economic development with local environmental protection. Recently, Chile’s world-leading copper industry was rocked by a strike after left-wing President Gabriel Boric announced he was shutting down the state-owned smelter over emissions concerns. Resource nationalism has also introduced geopolitical quandaries: it has made Latin America a center of competition between China and the United States. In Mexico, President Andres Manuel López Obrador has had to walk back a bold declaration on nationalizing the country’s lithium deposits after running into conflicts with Chinese mining firms who already secured lithium concessions.

    Resource nationalism in Latin America is nothing new; there’s a long history of state involvement in mining and energy. What’s different about this wave of decarbonization?

    Miguel Angel Marmolejo Cervantes: This wave is driven by the energy transition. In Mexico, we’re seeing a new wave of announcements and energy around nationalization, largely comprising old practices. The current proposal is an increased role for the state, and a lesser role of the market, with no checks and balances. 

    THEA RIOFRANCOS: I want to talk about what’s different about resource nationalism in the present moment versus the classic moment of the early to mid twentieth century. Looking at Cardenas and oil in Mexico, or Allende and copper in Chile, these classic nationalizations did expropriate resources. They took assets out of the hands of capitalists, in some cases forcing foreign capitalists to leave the country. There was capital flight, a real transfer of assets from the private to public sector, and at times deep reorganizations of the sector to serve goals apart from profit accumulation. In comparison to today’s agenda, this is both a “classic” but also more radical form of resource nationalism.

    We can broaden it beyond decarbonization because some of what I’m saying pertains to the fossil-fuel sector in the Global South. First of all, we’ve seen less of the classic form of expropriation, and more actions like forced renegotiations of contracts, majority stakes for the state, and joint ventures. In the current moment, the state is more collaborative with foreign or multinational capital, even if it’s coming from a position of strength. It doesn’t generally exclude private ownership, but aims to put the state in the driver’s seat. In some cases, there isn’t much private capital at all, and we see the state taking charge in new sectors. But despite the rhetoric, the aim is to attract private investment.

    Another new development is that state-owned firms and resource sectors—mining or fossil fuels—are more isomorphic with multinationals. They look similar, they have similar governance structures. That again is another way in which nationalization is less radical than in the past.

    In the lithium sector, there are different roles being envisioned for a state firm outside of exploration and ownership. These include research and development, upgrading, and value-chain coordination. The goal is to put the state in a key coordination role along with existing or new private investment to orient the sector towards, variously, increasing the societal take, the value-added, or spurring the energy transition. Whatever the goal is, the state’s role in coordination is different from the classic “digging in the ground” image of resource nationalism.

    Martín Obaya: In general, we think of nationalization as greater involvement of the state, but as Thea said, the state can intervene in many different ways. There are different strategies involving lithium in the region. On the one extreme, you have a more classical example of nationalization in Bolivia: the state owns the resource and a public firm has the monopoly of exploitation. On the other extreme, you have Argentina: it’s market-led, and the only push towards nationalization is public oil company YPF saying they want to step into the lithium business. A more intermediate experience is that of Chile. We’ll see what will happen, but my feeling is that Chile’s intention to build a public lithium company will be more along the lines of creating a company that can form joint ventures with a private firm in order to have more control of the resource. But the starting point is that they don’t have the resources to do it by themselves.

    This new wave of decarbonization-induced resource nationalism provides states with new narratives. In Argentina, one narrative is that we are the protagonists of the energy transition as suppliers of raw materials, so we have to supply these materials as quickly—before our window of opportunity closes. There’s a narrative that the energy transition is unfair, because it benefits countries from the North, so a country like Argentina should claim strategic control of necessary resources. Then yet another narrative is that resource extraction alone is not enough. If we have lithium, we have to industrialize it, and we should directly produce batteries.

    These are the narratives of nationalization within the frame of the energy transition. As Miguel Angel suggested before, is this not old wine in new bottles? In the end, we’re discussing what the role of natural resources is in the strategy of economic development. But we’ve had the essence of this discussion for the last seventy years.

    AY: What is that old wine? What have traditionally been the pitfalls of resource nationalism as the engine of national economic development? Where has it made good on its promise and where has it fallen short?

    MO: When I say old wine, I mean first the role of national resources in the strategy of economic development, and then the role of the state in that particular strategy. There’s the case of Codelco in copper, a national champion of Chile, where a state-owned company producing natural resources contributed to development, at least in macroeconomic terms, and provided foreign resources to a country. In the case of Argentina, the experience is more modest. The oil company did contribute to the development of oil resources in the past, but then it was privatized before being nationalized again, and contributed to the development of nonconventional sources. The experience is mixed and depends on each country.

    MAMC: To me, one old practice or framework is the idea that the state as an entity should be present all the time. But it could refer to extractivism. Extractivism as a concept has evolved over time. Following on from Thea’s work, I wrote an article with Rafael Garduño-Rivero that asked whether extractivism with regard to lithium was hard or soft nationalization. Hard nationalization, to us, is just the state, and soft nationalization is half the state, half private investors. We have a mixed economy, where you have to let the investors play around and develop their expertise, especially around technology. Old practices mean extractivism, but these could evolve.

    TR: I’m glad that Miguel used the term extractivism, which is a contested term and carries its own critique of state-led resource development. There’s an environmental, social, and indigenous justice critique of any type of resource development, whether public or private. But to stay with the macroeconomic question, we can ask: how much has resource development contributed to the overall economic revenues of the state, and what have those revenues been reinvested in? Has it contributed to developmental indicators through reinvestment in social and public services, or job growth? Has state ownership contributed to economic diversification and upgrading? The record is mixed on all fronts, which doesn’t just point to the errors of state ownership, but also the constraints of the global economic order.

    There is a position of dependency on foreign capital which constrains state action. But even with this caveat, the most recent nationalizations—not “hard” nationalizations at all—did see a big boon to state finances through the forced renegotiation of contracts, majority stakes, and joint ventures. In many cases, those were invested in ways that met human needs. Putting aside corruption and mismanagement, the overall picture is that many were lifted out of poverty, and much of that was due to resource rents—in my view, that’s a success.

    There was a failure in limited diversification and limited value added. Many petrostates don’t have refineries, so there’s no value adding in the supply chain, let alone diversification. So the fundamental dependency on the overall market structure persists, even if there’s less dependency on immediate foreign capital. The volatility of these commodity markets affects that fiscal basis of the state in a very deep way. The closer you tie the fiscal basis to volatile markets, the more you are at a loss when there’s a commodity bust, and then you are forced to implement austerity.

    MAMC: Pemex resulted from a nationalist policy, and now lithium is next. There’s been successful national development, but crises in governance—corruption, international trading, and debt burdens—compel governments to find and coexist with market solutions. We are at a turning point right now, especially with lithium. In Mexico, there will be a state company, but it’s yet to be incorporated. President López Obrador amended the mining law and it was approved by Congress, and now they have 90 days. But we still don’t know if this is the path we should follow in a modern economy.

    AY: Thea, you’ve written quite extensively about conflicts between the old-school resource nationalists who want to engage in, as Miguel described, a hard extractivist resource nationalism, and a newer generation of activists aligned with the indigenous rights movement, who seek to limit extractivism. In the context of oil, these seem like pretty clearly demarcated camps, but does that change in the context of lithium and the transition away from oil?

    TR: There was a tension that resonated across the region between environmentalists and indigenous movements, on one side, and Pink Tide governments that had pinned their economic and political mandate on expanding the state role in extractive sectors and, in many cases, expanding extraction in territorial terms. This generated conflicts, especially in Ecuador. Drawing on recent events in Chile, Ecuador, and Colombia, I think there’s been a mutual learning process since then, and both sides are now less defined.

    On the one hand, very militant indigenous and anti-extraction activists are still resisting at the point of extraction. But there’s also been a realization of how dangerous it is to have the right wing in power. Left fragmentation leads to even higher levels of criminalization of anti-extraction protesters. It’s worse to be under a right-wing government, even if the left-wing government does not behave well towards those protesters. I think there’s a shared desire to have the left in power, even if those tensions exist. Mexico might be distinct, but in Chile, Colombia, and even in the failed campaign of Arauz in Ecuador, there’s also much more acknowledgement of the environmental concerns of indigenous movements and of pluriculturalism. Both sides seem to be reaching each other a bit.

    Is this tension different in lithium or energy transition sectors? Just to underscore what Martín said earlier, I do think that there are new narratives from the state, and these are good and bad from the environmental perspective. On the one hand, many states are emphasizing not the extractive end but the value added—the upgrading, the innovation—and some of those roles have less immediate environmental harm. The state is inserting itself in a part of the supply chain that might generate less conflict with frontline communities, which is a positive way to look at it. But the more negative side is that corporate mining corporations are equipped with a narrative that they need to mine lithium to fight climate change, no matter what the resistance is.

    MO: In the case of Argentina, the category left or right isn’t very useful in explaining the positions around the environment and indigenous rights. Obviously there are relatively small progressive groups which are sensitive to this topic. But in general, there is political consensus that lithium and resources in general are strategic industries. On the left, the narrative is more centered around adding value, providing a strategic role to the scientific community, and creating capabilities related to the resource.

    On the center right, the narrative is around immediate exploitation and exportation. We have a supposedly left-oriented government, and there are two groups of discussion within the coalition. One group is more sensitive to environmental issues, and the other is in favor of greater extraction, basically arguing that we have the same GDP per capita as 1974. In political terms, the urgency is how to get foreign dollars from the exportation of resources. This is the priority, and that’s why there’s broad consensus.

    MAMC: Mexico is trying to balance social and environmental justice. For instance, we are part of the ILO 1969 Treaty, which was incorporated in the recent mining law amendments. Mexican states have a duty to protect the environment and the rights of the indigenous community and Afro Mexican communities. 

    MO:  In Bolivia, many environmental groups were disappointed with the government of Evo Morales. They felt that the government went too far with the exploitation of natural resources. It is a delicate balance—the government needs to deal with the urgency of the economy, which in terms of perception is more urgent than the environment now. It’s important to understand why some people change when they enter government. Promises to an environmental agenda are difficult to maintain alongside a social agenda.

    TR: An interesting development is civil society groups thinking in terms of the role of public control, a little distinct from outright state control. Miguel pointed this out earlier: public ownership is maybe broader than state ownership, it can take various forms. There can be community ownership, there can be worker ownership, there can be joint governance. Activists in Chile and elsewhere in the region are saying that they don’t want to repeat Codelco, because Codelco created environmental harms. Instead, they advocate for expanding the role of the public broadly construed in order to meet environmental goals. 

    The question becomes: even if you arrive with that agenda to power, will that create dissensus within the state? I think that anti-extractivism in the past was more anti-statist, and now there is a greater focus on the hybrid forms of ownership that include the public, civil society, workers, and communities that can ensure more of the environmental agenda is actually implemented.

    AY: Commodity shocks have driven many large firms to vertically integrate their natural resource supply chains, particularly in the case of lithium. Tesla, for example, is taking extraordinary measures to secure vast reserves of these minerals, and that means that a new generation of large corporate actors are going to have interests in the region, in natural resources that are at the heart of these national economic development strategies. How can national governments balance their desire to attract foreign investment and expertise with the very troubled history of multinational and American corporate conduct in the region?

    MO: The experiences are very different in the lithium triangle. In Argentina, I see no conflict because the market is open to foreign firms. The firms operating in downstream segments—the processes after extraction—are in some cases creating joint ventures with mining companies. In other cases, they deal with supply agreements. If in the future YPF enters the market, it will operate like a private player without privileges. In the case of Chile, there shouldn’t be any conflict if the government creates this public lithium firm. As far as I know, the idea is to create a joint venture, in association with private firms. The two contracts with SQM and Albemarle will remain in force. Maybe the case of Bolivia is different, because the normative framework is different.

    MAMC: It is quite the opposite in Mexico. There is conflict, especially with the recent amendments of the mining law. But I’d like to add that it’s not only Tesla, Chinese companies are also working vertically, and the main demand right now is from China. Lithium offers an important opportunity across North America, especially because in the US, it is considered a matter of national and defense policy. In terms of the USMCA, lithium could represent an opportunity for Mexico, but the recently amended law is also under review in the Mexican Supreme Court. It has been challenged for contradicting the Mexican Constitution and trade agreements signed by Mexico.

    TR: These answers reveal a lot about cross national variation. What are the implications for state ownership and the state position in the global market of this rush to secure resources? Argentina and Chile are already major producers of lithium. What does it mean to have Tesla, Volkswagen, and BYD China invest? One option is a long-term offtake agreement—Tesla wants to make sure it has a lithium supply for the next ten years, so it contracts directly with a lithium firm to get the supply from a specific mine. The second option is more unusual in contemporary terms, but it almost harkens back to the early twentieth century with direct vertical integration—Tesla might be a joint owner of a mine. 

    More investment flows and buyers mean demand and prices stay high—this is the positive side. But the geopolitics are complex. Chile is an example, it is an existing producer and it’s establishing a state-owned company. Chile wants to maintain its market position while moving up the value chain, two goals with different policies. The US and the EU have declared lithium a strategic critical mineral, incentivizing lithium production within their borders. Global South producers may lose their market share five or ten years down the line. Now, there’s new competition around raw materials, and Global North states are also pursuing the same developmentalist strategy—they want to move up the value chain and they’re fighting for investment from Korea, Japan, and China to build battery companies. On both ends, Global South producers are being squeezed. In terms of setting up the supply chain and maintaining market share, there’s suddenly competition from countries very well-positioned in terms of their relationship with multinational firms.

    Will Chile and Argentina remain number two and three on the lithium production list? Or will they be bumped down by Portugal and Mexico? The whole list of producers is changing and that has a lot to do with the securitization of lithium by the Global North, a strategy pursued by both governments and firms.

    MO: The US signed a mineral security partnership with Canada, Australia, the UK, and Germany a few weeks ago. The idea is friend-shoring in response to competition with China. I think that’s the correct framework to analyze the latent question in Latin America. With the exception of the US, I don’t think we’ll find much lithium in other parts of the world, at least at competitive prices, in the next ten years. In Europe, there’s Portugal and some alternative lithium resources, but the technology has to be developed.

    In my view, it’s the same with Mexico—I don’t think Mexico will be able to produce lithium compounds or lithium concentrate in the next ten years because they have clay resources and the technology has to be developed. In the beginning, the production costs will be much higher than the rest of South America. I agree with you, Thea, about the context, but I think that South America still has some advantage on the upstream sector, the exploration and production side.

    In regards to the competition between the US, the EU, and China, Argentina is the most interesting case because it’s the most open. Last month’s International Lithium Congress in Catamarca expected 200 people, and 800 people from all over the world attended, because Argentina is the only country with good lithium resources open to investment. Chile is practically closed and Bolivia is closed.

    MAMC:  I agree with Martín. Lithium is present in pegmatite, brine, and even in oceans, and it is economically feasible in brine and pegmatites. Unfortunately, Mexico has lithium waste and clay deposits. It seems that the technology won’t be on our side for the time being, but that’s just on the upstream side. If we are talking about midstream and downstream, we are in a strategic position. Chinese companies can Mexicanize their investment and get access to the North American free trade market. If I were the president of Mexico, I would remain neutral because we need to work with the US—we are basically integrated in terms of global supply chains, but we don’t want to be more dependent on the US economy. Still, we need to open our economy and try to set up a joint venture with the Chinese market because at the end of the day the demand is coming from China, not Europe, the US, or Canada.

    The question is, are we going to follow this free market vision? What about the environmental concerns, the questions around social benefits for the public? One of the main critiques is that free trade agreements don’t necessarily benefit the public, and if the public isn’t the beneficiary, we’ll have political turmoil. We’ve seen that in Chile, and tensions are high in Mexico in terms of the US-Mexico relationship. Trudeau and Boric just celebrated the twenty-fifth anniversary of the Canada-Chile Free Trade Agreement. You will not see López Obrador and Biden getting along in this way, and this matters because it’s how countries set up a meaningful dialogue on critical issues.

    AY: A decade ago, there was some hope that decarbonization might foster global cooperation. It now seems clear that this is a domain of global political competition, particularly between the US and China. How are various lithium producing countries of Latin America trying to situate themselves within this competition, not to mention within the rest of the global market?

    MO: As Miguel said before, I’d say that Argentina should follow the same strategy of neutrality. They’ve done it with the US, China, and even with Russia, but I don’t know how long they’ll be able to maintain it. The US was the pioneer investor of lithium production in Argentina and in the region in general, but in the last few years, China has adopted a more effective strategy and now controls a few sellers in Argentina. In the future, we may see the majority of lithium production in the country controlled by Chinese firms.

    MAMC: I would say that Mexico is “nearshoring,”and the decoupling of the global supply chain is not as easy as we may think. In fact, it’s on the verge of a conflict. Chinese companies were granted a concession for thirty years of lithium exploitation in the last administration. But how will that work when the US is our main trading partner? At the end of the day, the best strategy available to Latin American countries is to remain neutral. If you pick one position, then your community will suffer the consequences.

    MO: There’s a big difference between Mexico and the rest of South America, which is that Mexico is already integrated into the North American automotive production network. I assume that North American producers that sell vehicles count on Mexican lithium. It will be a delicate balance, because if you have this critical mineral just across the border, it is your strategic advantage. It will be difficult to maintain this neutrality.

    TR:  If you had asked me a couple years ago if I saw the decoupling of supply chains along geopolitical alliances as a possibility, I would have said well a lot of people I interview in government and corporations either want that or are worried about it, but it’s hard to imagine: how would you take apart these intricate sprawling supply chains, where would you decide the US begins and China ends? Fast forward to the present, and we have decoupled a major economy from a large portion of global trade and financial systems. The Russia sanctions are showing us in real time how something like decoupling could work. At the same time, the US Congress passed the Uighur Forced Labor Prevention Act to scrutinize supply chains that run through forced labor in China, but we are still seeing how it will actually work in practice. 

    These are two touchstones—Russia’s invasion of Ukraine and the economic fallout and sanctions, and the US Congress showing a rare moment of bipartisanship taking action to limit how goods coming through China are entering the US. This makes it seem more possible to me that there’s a future in which countries need to pick sides. The flipside of friend-shoring, like Martín said, is: will there be moments in which a state-owned lithium company that has a deal with CATL, BYD, or another Chinese battery maker is cut off from the US because it violates the Forced Labor Act? These are real questions with more to them than pipe dreams of autarky.

  2. The Economic Style

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    For some, neoliberalism is to blame for most, if not all, of our societal problems, as well as for the resistance to progressive changes that characterizes contemporary policymaking. This is for good reason. As has been extensively documented, the neoliberal obsession with fiscal austerity and efficiency has been associated with the increase of inequality, precariousness of job contracts, and dismantling of safety nets throughout the world. 

    In her new book Thinking Like an Economist, sociologist Elizabeth Popp Berman suggests that, in the case of the US, neoliberalism may not be the root cause of all social problems. She instead redirects our attention to the role of economics, or more specifically, the institutionalization of an economic style of reasoning that has transformed US public policy since the 1960s. The main consequence of this institutionalization, Popp Berman explains, is that goals that made sense through the lens of economics—growth, efficiency, productivity—came to displace competing visions for policy. Efforts to promote political empowerment of the poor, limit the concentration of power, and protect the environment were harder to understand in economic terms. The result has been a restructuring of the space of political possibility, constraining it to policy options that meet the value of efficiency, but not necessarily equity. 

    Thinking Like an Economist convincingly shows that the social sciences can indeed shape politics, but perhaps not how academics intend or anticipate. In Popp Berman’s account, the impact of economics comes not by providing the right answers to politically relevant questions, but by shaping the questions that can be considered in the first place. As the state of the world attests, the book serves as a powerful reminder that the time has come to start asking different questions.

    An interview with Elizabeth Popp Berman

    Luciana de Souza Leão: In contrast to narratives of a neoliberal turn that explains most societal problems—and in particular the lack of progressive policymaking in the US—you suggest that an economic style of reasoning became institutionalized in the US government. You argue that it was actually so-called liberal economists—liberal in the American sense—that are to blame for many of the problems attributed to neoliberalism. How did you arrive at this conclusion? When did you start thinking that the problem was economics as a form of thinking about the world, and not necessarily just neoliberalism?

    Elizabeth Popp Berman: The motivation for writing the book was partly political. I felt that the horizon of possibility was very constrained for people on the left in the US, and especially within the Democratic Party, but it’s not that I set out to write a book about why the Democrats don’t do more ambitious things. 

    I had a pretty clear sense that I did not want to tell the right-wing Chicago School economist story—I’d felt for a long time that an important piece of the story of neoliberalism and political change was missing. Not everything turned out the way it did because Milton Friedman and Friedrich Hayek had a project. 

    My first book was about the marketization of academic science. I argued that economic ideas shape how policymakers think, and in that particular case, the idea that technological innovation drives growth was paramount. I began studying different cases, and I kept returning to the centrality of technocratic economists, people who wanted to use government to make change and to do better, but had a very particular idea of what that change needed to look like. It wasn’t until fairly late that I decided to commit to taking them to task for that. I knew it would provoke some response: a lot of the people in this space share progressive values and genuinely see themselves as helping through the means of the state and government. 

    LSL: In the book, you don’t talk a lot about your methods and historical work, though you base yourself in data and historical analysis. What were the main sites of research, and how did they shape your argument? 

    EPB: I went through a lot of different cases in the process of thinking about what the argument was. I started out by trying to identify policy domains where economics had been demonstrated to be deeply influential. Anti-poverty policy was one of my starting points. In some domains, there’s already a rich secondary literature—for example, Marc Eisner’s Antitrust and the Triumph of Economics makes a compelling case about the influence of economics in that area. As I was doing more research, these cases kept intersecting, and people were showing up in policymaking spaces that I had assumed were somewhat independent.

    In some instances that wasn’t so surprising, but sometimes anti-poverty policy overlapped with antitrust or regulation, or some other totally different domain. So tracing influence in different policy domains was the original methodological logic, and then as I started to develop an argument, I added cases to test it, some of which were significantly cut in the final book, like housing and education policy.  

    I realized that I wasn’t telling a story just about specific policy areas, but rather a broader story about policy change. I did a lot of archival research, but honestly I think the most important work was the synthetic work, drawing on lots of existing information about these different policy domains and figuring out how it all fit together. 

    LSL: The institutionalization of economic reasoning meant that arguments based on efficiency were taken for granted, and other policy options based on rights or universalism were considered naive. This resonates with what I found in joint work with Diana Graizbord around anti-poverty policies in Mexico and Brazil. Experts have to do cultural and ideological work to make people buy into the idea of efficiency—essentially winning their hearts and minds. You mention resistance to changes from inside the government. Could you tell us more about both the resistance work at the symbolic level, and how the technocrats you study were able to initially convince people to buy in?

    EPB: There was a very broad cultural resistance to the kinds of arguments that economists made in the 1950s and 1960s. For example, in 1959 Ronald Coase published a paper arguing that the Federal Communications Commission (FCC) should auction off the electromagnetic spectrum. But at the time, the FCC assigned these rights through administrative means. The dominant idea was that the public owns the airwaves, so they should be run in the interest of the public. 

    When Coase initially made this suggestion as a consultant at the RAND Corporation, it was so controversial that RAND suppressed the report. When he testified in Congress, members of Congress voiced their complete rejection, saying, “How can you say that we should just sell off this public resource to the highest bidder? What a terrible idea.” 

    People in positions of authority found the basic framework of economics to be problematic because it competed with their existing moral vision in some way, and they voiced their opposition verbally. But a lot of the advance of economics really took place in the federal bureaucracy, and in those places the resistance looked different. A big piece of the story is the spread of the Planning-Programming-Budgeting System (PPBS). This budgeting system grew out of the RAND Corporation, and it was implemented across different executive agencies. With PPBS, you would decide your agency’s goals, and then systematically compare the different programs imagined that could get you there. You would try to quantify everything to the greatest extent possible, and then choose the most cost-effective program as the best policy decision. Your budgeting decisions would follow from that initial analysis.

    There was a lot of resistance to PPBS, for different reasons. Some people were morally opposed: Alice Rivlin once spoke about how teachers and doctors don’t like to think of their work in terms of its economic value. But a lot of times, the resistance was due to bureaucratic interests as well. Agencies didn’t have the actual staff prepared to use these methods, to think about their goals and define them in a quantitative way. Many bureaucrats found the system stupid, thinking that it was for show and the real decisions were going to be political anyway—which is kind of what ended up happening. I would distinguish between these kinds of resistance, which were about the practical implications of ideas, and a broader moral opposition to the framework of economics.

    LSL: Once these methods and frameworks become institutionalized, were bureaucrats persuaded? Were these methods imposed on them, or did symbolic work eventually make them believe in efficiency as a value? 

    EPB: It was less about the work of persuasion and more about the work of creating new believers. The PPBS rollout was initially top down. It started at the Defense Department with Robert McNamara’s directive, and Lyndon B. Johnson rolled it out on the basis of its success there. He had been convinced by a couple of economists at the Budget Bureau, and he signed an executive order. 

    At the time, there were some interesting studies done that looked at which agencies really used the methods and which just filled out the paperwork. They found that in the few agencies that really used the methods, the leader had some kind of belief in the system, even if they weren’t an economist. But the PPBSers didn’t convince most agency leaders. The process of rolling out the methods led to the creation of new believers. The origins of policy schools trace back to this moment. The government needed people who could use these methods, and universities saw an opportunity to meet a market demand for people who could do these analyses. Thousands of people were trained to think in this way, and then they moved into policy spaces. People were convinced at age twenty-three when they were getting their master’s degree.

    Implementing the methods created new resource streams, in particular around social policy. Those advocating for PPBS generally believed that we should measure the cost-effectiveness of policy in general, so they supported policy evaluation. They started to ensure that evaluation money would be included in social policy bills—this created resources that could go to think tanks, which could then hire people to conduct these analyses, who are in turn those who have already bought into the framework. All of a sudden, there was a much larger space of people, think tanks, and research institutes invested in this vision. 

    LSL: You mention Alice O’Connor and the poverty research industry. As you show very convincingly, technocrats avoid talking about race when they’re talking about efficiency. Using the example of social policy, why do you think economic reasoning was so successful with anti-poverty policies? Can you pinpoint some of the racial, cultural, and class premises that favored one type of anti-poverty option, say the Child Tax Credit or the Negative Income Tax, over policies based on community participation, for example?

    EPB: Anti-poverty policy in particular was a project that succeeded because it solved certain racial problems for the state. The initial phase of the War on Poverty was organized around the idea of community action. This phase reflected an underlying theory that if poor people were politically empowered, they would be able to make their own claims, and get their needs met through the state—political empowerment could solve poverty in the long run. But the project was very quickly bogged down in racism. Poor communities, mostly communities of color in cities, organized and placed demands on mayors, who were typically white Democrats. The collective organizing of Black and Latino organizations—which often produced conflict and drew attention to achieve political goals—created problems for the Democratic Party.

    Community action became a problem to solve rather than a model to emulate, specifically for Johnson. All of a sudden, Democratic mayors were showing up at his door saying, “What the hell, we are your support base, why are you doing this to us?” The shift to an economic framework—the idea that what poor people need isn’t political agency, but income—was instrumental. If we can just figure out how to get money to people who don’t have it, we can solve the problem efficiently. The shift worked in part because of racism. There are moments where proponents of the economic style speak with a subtext which points to race—or perhaps an opposition to the world view of those supporting community action efforts. But what was fundamental was that the new anti-poverty methods sidestepped questions of race, and made it irrelevant in policy. You don’t have to talk about race if all you care about is people’s incomes. And I think that’s a big reason why economic reasoning around anti-poverty was so successful—it sidestepped race.

    LSL: What were the paths not taken that would allow us to rethink the relationship between economic reasoning and public policy? 

    EPB: I find it hard not to feel like the whole thing was overdetermined. Even if the people I write about in the book hadn’t existed, I do think that the broad political and economic changes at the global level—and the changing position of the US within that—make it seem that this turn away from government and its ability to deliver on universal ideals and claims about rights, would have happened anyways.

    LSL: You have a great line in the book, almost playing on Weber’s switchman: “The economic style of reasoning was not the main reason, but the main channel.”

    EPB:  It matters that once you have a certain set of people with certain ideas occupying positions of influence, more and more people are trained in certain ways, take new things for granted, and this becomes very sticky and very difficult to dislodge. I believe completely that a large-scale material change could disrupt the whole enterprise and usher in a new era. But in the meantime, as we go through periods of smaller change, the institutionalization of the style of reasoning makes it difficult to do much outside of it. 

    The Biden administration has several appointees that come from a different place. But I think you can also see that many of the progressive policies they’ve advocated for have been marginalized by the more dominant voices who adhere to the economic style of reasoning, and consider these other approaches naive. 

    LSL:  How can we approach the question of policy values in terms of economic reasoning? I come from a so-called poor country that has universal health care, and the health-care story you tell is striking in terms of paths not taken; I take for granted that everybody should have access to free healthcare. How can we discuss those values with economists without sounding naive?

    EPB:  In policy spaces, it’s almost a necessity to translate any action into economic terms. Someone may be motivated to pursue a policy because of justice, equity, or some underlying deep core value that doesn’t have anything to do with efficiency, but in many cases it just absolutely has to be translated into that language in order to be heard. I think part of the problem is that we often limit ourselves to that language even when we are not talking to narrow technocratic audiences. Whole political campaigns are focused on narrow technocratic fixes. I think of Obama and the health care exchanges. It is politically difficult to sell some complicated market-like mechanism and convince someone it’ll make their life better. I think it’s really important to aggressively make the other kinds of value-based arguments to broader audiences.

    LSL:  To what extent is this an American story? As we know from the work of Marion Fourcade and others, economics is an international field, regardless of where you’re trained. Can we expect this style of economic reasoning to have similar political effects in other parts of the world as well? 

    EPB:  The answer is both yes and no. The book is fundamentally about the US case, and many of the dynamics and actors are specific to the US. Economists & Societies is a great illustration of how different configurations of knowledge formation of states work together to produce nationally distinct outcomes. At the same time, like you say, economics is an international field, and there is a lot of commonality. Many people trained in the US go elsewhere to work in policy positions. The US is still the hegemonic figure within the discipline, at least for now. In that respect, I think you can see the US as a bellwether case; these changes were happening here before they happened anywhere else.

    A lot of what I refer to as the economic style of reasoning is part of this broader space of rationalization processes. New public management, scientific management, all these processes of thinking quantitatively and rationally about how to effectively reach organizational or political goals—these are global societal trends. There are places which it is channeled through economics and tends to look similar to the US, and there are also places where it’s happening through other national disciplinary configurations, making it look quite different. 

    LSL:  I’m always struck by how the US public policy debate is not comparative—both the differences in the dominant policy-relevant disciplines, and the policy outcomes that flow from them, are obscured. In some cases, compared to the US, countries in the global South have accomplished more progressive measures with much less money. 

    Brazil provides one way to think outside the grammar of efficiency. When it implemented its conditional cash transfer, Bolsa Familia, it was a very specific moment when ending poverty was the political project. The Lula administration said, efficiency is not our priority, we are worried more about excluding poor families than including families who are not poor into our CCT. Those good years of political focus on inclusion are long gone, but it proves that there were political moments where bureaucracies could legitimately say that efficiency was not their goal. 

    Yet, you show very well how this language of efficiency connects to strict budgeting and austerity, which seems to be the most common political context. PPBS is always more useful when you need to cut costs. This language of fiscal austerity and efficiency fits together really well. 

    EPB:  It’s a good reminder that the right political configuration can produce more significant structural change. Does that seem likely to happen in the US soon? I would say no. On the other hand, I do think that social movements and the resurgent left in the US can put real pressure on that system. While it is easy to be pessimistic about what’s coming, it is also possible to imagine enough of a base organized that you have politicians brought into power championing the idea that inclusion and not efficiency is the priority. If you’ve got enough political power, then everything else will follow along. Maybe economists don’t matter that much in the end.

  3. The IMF & the Legacy of Bretton Woods

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    Fifty years on from the collapse of the Bretton Woods system, the role of the international monetary system and international financial institutions in managing the global economy are in question.

    What role should these institutions have in fostering development, closing the North-South divide, tackling inequalities, and promoting a global green transition? Can a more progressive international monetary system be forged?

    In May, a Phenomenal World event tackled the political, economic, and legal questions thrown up by the present state of the post-Bretton Woods system. A recording of the event can be seen here. The transcript was edited for length and clarity.

    A conversation on the IMF and the legacy of Bretton Woods

    Karina Patricio Ferreira Lima: It’s been fifty years since the collapse of Bretton Woods. As the global pandemic, various economic shocks, and a generalized state of financial instability have now converged into a debt crisis, the inadequacy of the international monetary system is on full display.

    The aim of this panel is to examine the legal, political, and economic problems that plague multilateral institutions and, in light of that, to consider paths forward. What systemic changes have occurred in the international monetary system since the end of Bretton Woods, and what have been their distributive and developmental consequences? 

    With its system of fixed exchange rates, Bretton Woods relied on countries’ ability to manage their capital accounts. With Nixon’s unilateral decision to end dollar convertibility to gold, this combination of fixed exchange rates and capital controls gave way to the emergence of the so-called fiduciary dollar. The centrality of the dollar in this new system, combined with capital-account openness and hyper-financialization, has generated great financial instability and exacerbated inequality between the Global North and the Global South. 

    The monetary arrangements currently in place generate a significant gap in access to liquidity between the core and the periphery. There are some procyclical effects in the periphery: money flows in search of higher interest rates when things are going well, but flees at the slightest sign of instability. Capital flight further destabilizes the economy and exacerbates inequality. 

    While core banks are able to use bilateral currency swaps with the Federal Reserve, developing and emerging countries typically rely on accumulating substantial foreign reserves to avoid monetary instability and payment problems. They can also resort to the IMF as a source of emergency liquidity or tap into regional financial arrangements, though these resources tend to be insufficient. 

    Because the conditions typically attached to IMF financing are highly procyclical, emerging countries have in recent decades decided to accumulate foreign reserves to avoid being subjected to IMF programs. Because these reserves are accumulated in treasuries, this results in a massive transfer of wealth to the Global North at an aggregate level. These are misallocated resources, however, which could otherwise be used to fund industrialization, low-carbon infrastructure, and other development initiatives. Despite their monetary character, there are no legal mechanisms to deal with insolvency crises at the periphery. 

    There are also no institutions explicitly geared towards promoting development. The World Bank acts as a market maker for financiers at the core by enforcing structural adjustment in the periphery. It shifts risk away from those financiers, using public resources to leverage private financing. It seems clear that the rules of the game are exacerbating global inequality. 

    Misery is increasing in vast segments of the global economy. Combined with the crisis of multilateralism, it seems likely that the post-Bretton Woods institutions will fragment and ultimately decline in importance. But what will replace them? In the following discussion, we unpack some of these questions.

    Richard Kozul-Wright: Looking at the world economy today, the growth dynamic in advanced economies and, in particular, in the United States, is key. The financialization of the US economy and its changing role in global markets is critical to understanding the demise of organized labor, the rise of intellectual property as a source of wealth, and a rent-seeking form of wealth creation. The domestic and international shifts are deeply intertwined. 

    MONA ALI: One clear outcome of the present crisis is increased dollar weaponization. The unilateral sanctions that have been imposed by the G7 effectively constrain and disable developing economies—we can go back to the Bank of England’s freezing of Venezuela’s gold reserves in 2018. Janet Yellen recently proposed the reshoring of supply chains, which has dire implications for the Global South. We’re also seeing these escalatory tactics with the US Treasury’s proposed secondary sanctions on countries purchasing Russian oil. Developing and emerging economies are cornered by over-compliance with sanctions and acute crises, preventing countries like Afghanistan and Yemen from converting their Special Drawing Rights (SDRs) into hard currency.

    KPFL: The emergency liquidity available to developing countries is channeled through the IMF, which puts the burden of adjustment on the jurisdiction facing the balance of payment problem. This has recessionary effects. Apart from the attempted 1990 reform to the Articles of Agreement, which proposed liberalizing capital accounts, the Fund has not had a legal mandate to regulate capital accounts since its founding. With increased financial instability, what it can do is exercise its surveillance and technical advisory functions to advise countries with its institutional view. 

    When it comes to lending, there is a legal obligation to make sure that the general resources of the IMF are not used to fund substantial and rapid capital outflows. Article One of the Agreement states that one of the Fund’s key purposes is to shorten the duration and lessen the degree of disequilibrium in members’ international balances of payments. For this reason, Article Six entitles the Fund to request capital-management measures as a condition to access this liquidity. If we construe the scope of the IMF obligations and entitlements on the basis of those two articles, we should agree that there is a legal obligation to request those capital management measures when it’s reasonably foreseeable and, when it’s not, to request that the general resources of the Fund be used to meet a large or sustained outflow of capital. This is not, however, what we see in practice.

    What role does the IMF currently play in the international monetary system, and is that role compatible with its legal mandate?

    CHRIS MARSH: The Bretton Woods Agreement gave the IMF some responsibility over members’ balance of payments. Prior to that, under the classical gold standard, there was an understanding that the balance of payments had an automatic adjustment connected to it, which was related to gold flows. This adjustment mechanism was built in, but the attempt to rebuild the world economy after the Great Depression nevertheless failed. The balance of payments constraint was intensified by trade wars and competitive devaluations. At Bretton Woods, it was agreed that the balance of payments had become a public-policy issue. But with the end of Bretton Woods, the emphasis on the adjustment mechanism—that is, the means by which a country’s balance of payments adjusts—has been almost entirely forgotten. 

    At its formation, the IMF sought to adapt the legal legacy from Bretton Woods, including balance of payments support under adequate safeguards. It developed its approach to financial programming over time through the adequate safeguard provision. There were a series of sector-consistent macro accounts that would underpin any lending agreement, and that in turn would underpin the adjustment mechanism whereby the country’s balance of payments would be adjusted temporarily to the external constraints that it faced. If a fundamental disequilibrium couldn’t be resolved, there would be an expected devaluation. This framework existed in the 1950s and ’60s but with hyper-financialization and the growth of capital flows, the nature of the balance of payments problem changed—it became less an internal problem of fiscal spending, and more an external problem where a country borrows money from abroad and then that money suddenly leaves.

    That doesn’t change the accounting constraints or the need to build a financial program. However, with the Asian financial crisis and the Mexico crisis in the 1990s, and then later with Argentine crisis in 2000–2001, the IMF framework was silently abandoned. Now, when the IMF arrives in a country, it produces documents that are analytically inconsistent. That results in a situation in which countries are forced to adjust to external constraints that they have no chance of meeting. We have a world where capital is freer than ever before, but analytically and intellectually we are more dysfunctional than we’ve been for decades of international monetary history. 

    LARA MERLING: For decades, IMF conditionality has pushed countries to liberalize their capital accounts. In 2012, they adopted the position that in certain situations, preemptive capital controls on inflows, but not outflows, were viable. This was seen as a step forward, but it was actually a backwards step from the Articles of Agreement. After the collapse of Bretton Woods and the start of the structural programs, the Articles did not change. What changed was how the IMF operated, and how its new conditions departed from its legal mandate.

    RKW: The Fund emerged in a very particular ideological environment. Managing markets was embedded in the ideology of the time, and the Fund reflected that. They recognized that in order to preempt advanced economies from adjusting through austerity measures, they would need some sort of short-term liquidity support in response to current-account difficulties. Most of the lending in the early days of the Fund through to the 1970s was to advanced economies; in the ’70s, the US repeatedly borrowed from the IMF.

    Now, the major borrowers from the Fund are peripheral economies, and that’s a significantly different power structure. In that context, the aims of the Fund are much less about managing markets and much more about enabling flows of capital. They then have to respond to the crises that these enabling actions create. The size of the flows are so significant that, ironically, the Fund doesn’t actually have the resources to respond. It needs partners to manage these crises. This was the case with Mexico in the early 1990s, again in Asia and Russia, and all the way through to Greece. 

    MA: I wanted to talk about what was dropped in those original Anglo-American negotiations of 1944. Keynes’ White plan for capital controls included not only controls for countries experiencing capital flight, but also for the countries to which capital was fleeing—tax havens. That was left out of Article Six, in large part because the US is not compelled to place a legal gate on capital inflows. We see this right now with net outflows from emerging markets since the war in Ukraine. 

    You guys have done fantastic work criticizing the IMF for not holding to the articles of the Agreement, but there’s also room to revisit the articles themselves. Michel Camdessus, former IMF Managing Director, recently brought this up—the Global South cannot be paralyzed by the statutes of the IMF. 

    Chris, the IMF previously worked on financial programming and sectoral disequilibrium, is that no longer the case? 

    CM: As capital flows have become more complicated and more difficult to manage, the tools that we use to manage them have become more simplistic. In the beginning, IMF financial programming would involve building a set of macro-financial accounts so that the macroeconomic outcomes were underpinned by financial flows, including through the central bank, and through the balance of payments and the banking system. This ensured that the programs’ objectives and in particular the GDP growth objectives, could be meaningfully met, while also building a buffer of reserve assets. That was the stereotype of how the IMF worked. 

    But the 1990s—with the capital-account problems and the second generation currency crises—showed that the IMF was not designed for these issues. The Fund was originally building programs to address overprinting to finance the fiscal deficit—the external problem was a reflection of the internal imbalances. The second generation currency crisis was an external problem, so it’s not clear that the balance of payments work makes sense anymore. In Paul Blustein’s book The Chastening, he quotes a mission chief who tells him, in reference to the Fund’s financial programming during the Asian crisis, “It’s not clear our economic theory works.” 

    At that stage, it seems to me that the IMF threw the baby out with the bathwater. They maintained that the framework still worked, but that it needed rejigging. They made the case that you need to change domestic flows to meet the external financing outflows, rather than changing the external flows to meet domestic problems. It’s because the IMF suddenly dropped this iterative approach to different financial-sector accounts, that there are massive inconsistencies and black holes in its program document today. 

    In the Argentine program, Karina and I noted three closely linked problems. The first is that there was a fiscal adjustment without any accompanying external adjustment. This is basically the idea that as long as you impose fiscal austerity to bring about primary surplus in the fiscal accounts, fiscal sustainability will be achieved. It doesn’t make sense because quite a bit of debt in these cases is external, so in order to service the public debt, you need the external accounts to generate the foreign exchange to service the external component of the debt. In Argentina’s case, they assumed a fiscal adjustment of maybe 5 percent of GDP.  But if there’s no external adjustment, you can’t service the external debt. It won’t be sustainable from external accounts, and the whole thing will not fit together. 

    The second problem is that they assumed that there would be a massive accumulation of reserve assets of the international reserves at the central bank. However, there were several inconsistencies within the document in how they presented the balance of payments—rollover rates of foreign investors, and so forth. Most importantly, they assumed that residents in Argentina would bring back tens of billions of dollars that they held abroad. But this wasn’t the case; those residents were taking money abroad because they were worried that the program would not work. 

    The third problem is that the central bank itself was printing money to finance its own deficit; it was issuing its own liabilities in lieu of the government issuing them. In other words, it was financing the government, then issuing these central-bank bills to mop up the liquidity. It was a fiscal problem that was hidden on the central bank balance sheet. They hadn’t programmed at all how this was going to get serviced and paid for—another big accounting black hole. The point of the paper is that alongside the legal problems, the macroeconomics of IMF programs just don’t add up.

    If it were an accounting firm, IMF documents would resemble an Enron-style fraud. Yet everybody turns away and says, “they’re doing their best.” But they’re not doing their best. They are destroying livelihoods in countries that they are supposed to help. 

    KPFL: What short and long-term reforms would be needed in the international monetary system to make it fit for achieving the UN Sustainable Development Goals (SDG) at a global level? 

    RKW: It’s always surprising how “short term” solutions can actually prove extremely difficult, given the way in which the system has evolved over the years. For example, it is ridiculous that the head of the organization has to be from Western Europe; trying to change that, however, is extremely difficult. In response to Chris’s point, the level of conformity amongst IMF staff is quite astounding. There’s a lack of diversity not just among the economists they hire, and they don’t really engage with other disciplines in the social sciences. There’s somehow a belief that their mechanistic brand of economics is the pinnacle of intellectual prowess, and everyone else is in some way secondary or inferior.

    Given the financial pressures in many developing countries and the investment demands implicit in delivering SDGs, they are currently undeliverable. From our perspective, delivering SDGs would require the restructuring and, in some cases, the cancelation of debts. Obviously this would require a fundamental institutional change, which as a creditor the IMF would resist. At the least, we should have a more independent process. The IMF should be a neutral venue that can properly manage debt in a way that allows countries to work through their problems and come out at the other end with some hope. The IMF will not contemplate that—we know what happened to the discussions around the sovereign-debt workout mechanism in the early 2000s.

    In Washington a couple of weeks ago, we met with a senior IMF official who simply stated that the Board will not tolerate this type of institutional change around restructuring. But there’s a much gentler way of moving the needle on issues of debt. This would involve advancing a set of principles for sovereign-debt restructuring, around which any sort of restructuring exercises should be framed as soft law, without having legalistic power. When that was attempted in 2015 with Argentina, the IMF simply opted out of any discussion on a set of principles. Soft law is not the thing you think would antagonize parties, but because the advanced economies were not really interested in engaging, the IMF didn’t engage either. UNCTAD was the support for that initiative at the United Nations. Soft law should not be a deeply ideological fight, but the resistance was extremely strong.

    Intermediate-term proposals that we’ve offered include establishing some sort of multilateral swap facility inside the IMF. We know how important the Federal Reserve has become in terms of offering swap arrangements in response to crisis. These are always biased as the Fed only offers those facilities to certain favored emerging economies. We don’t see any traction to that idea inside the Fund, although it would be an obvious way of dealing with some of the problems in implementing SDRs. We’ve reached a sad state of affairs, where the obvious solution to using SDRs more effectively is to recycle them from the countries that don’t need them to the countries that do. That would seem to be a mechanical issue, but it has become highly politicized to the point where it may be easier to have another very large allocation, even though that allocation will suffer from the problems of the bias in the system, because SDRs are allocated on exposure on the basis of the quota system.

    I don’t think there’s any doubt that we need the Fund. Indeed, we would argue that we need a bigger Fund. Compared with the size of the global economy in 1945, the Fund has shrunk hugely over the course of the last 75 years, and its challenges have only increased. But a larger IMF will need these accompanying changes that we’ve mentioned. In the case of debt, we need to talk about more serious radical changes to the institutional architecture if we are going to genuinely make progress.

    LM: Most people know about the $650 billion SDR allocation of August 2020, as a response to the pandemic. Many of us here were advocating for a much larger allocation and are still advocating for more. As Richard said, because of how the system is designed, only about $200 billion of that original allocation went to the countries that needed it. At CEPR, we published a paper with Kevin Cashman and Andres Arnauz tracking the use of these SDRs—90 countries spent their SDRs, and it was the only meaningful debt-free relief that they received. 

    In the end, it does all go back to IMF quotas and US power. The US is very resistant to any type of meaningful change. Even decades ago, when they pushed bringing neoclassical economics or Reaganomics into the IMF, they did so without changing the Articles of Agreement. We see the US talking about the rules-based international order, but they change the rules according to their own agenda. 

    RKW: I don’t think a single dollar of SDR has actually been recycled, is that correct?

    LM: The IMF’s Resilience and Sustainability Trust (RST) was the first mechanism to recycle, and it was supposed to provide long-term loans for climate and health needs. They got about $40 billion in recycled SDR commitments. It started with an idea to recycle and provide financing, and was ultimately linked to an IMF program. Countries that already go to the IMF might use it, but it’s not a meaningful additional financing tool for climate or support. 

    MA: Andrés Arnauz estimated $550 billion in unused SDRs lying in advanced economies’ central banks or Treasury accounts. The Articles of the Agreement say that these can be bilaterally donated. I do want to ask you, Richard about your views on the new RST, because as you said, Laura, it is a loan rather than a donation. 

    RKW: We are still waiting to find out the lending conditions. The Fund attributes a lot of importance to transparency when it comes to developing countries. but they don’t necessarily promote it when it comes to their own practices. That sense of hypocrisy needs to change. 

    This is again part of the evolution of the international financial institutions; the Fund has begun to move into areas of lending that it was not originally set up to to deal with. Arguably, the IMF should not be responsible for financing around the climate, whether it is for mitigation or adaptation. The $40 billion figure itself is not the kind of number that developing countries want to hear when it comes to financing the climate transition. Of course, the numbers are much larger, and they will almost certainly come with conditions attached. 

    My impression from the last meeting in Washington is that developing countries are increasingly frustrated by the fact that none of these proposals deal with the major problems they face—immediate adjustment problems on a significant scale. Sri Lanka is just the first of many; if we don’t develop new arrangements, what is happening there will become a widespread feature of the periphery over the next eighteen months, and probably beyond that.

    KPFL: Mona discusses the ways in which the current geopolitical landscape and the sanctions imposed on poor countries will impact the needs, content, and prospects of a structural reform in the international monetary system. Does the current geopolitical landscape encourage or undermine reform prospects? 

    MA: I think we are currently seeing the weaponization of the global financial architecture. Yemen and Afghanistan have been issued SDRs in the new $650 billion issuance. Yemen, an internationally recognized government, is unable to convert its SDRs into hard currency with a partner because of the weaponization. 

    This situation is getting worse in the aftermath of the pandemic. Emerging economies have calculated their need at about $4.3 trillion, while the G20 committed last year to $100 billion that has yet to be delivered. The numbers are just way off.

    Richard, I want to come back to your very important point, which is that we’re looking at two decades of lost growth in developing and emerging economies. The problem is not a lack of liquidity—the $550 billion in the coffers of advanced economies could be supplied to diminish some of these very short-term needs in countries like Sri Lanka that have actually gone through default. As you say, those problems are so intractable given the very opaque and oligopolistic structure at the IMF. Weaponization is going to lead to a fragmentation of the global economic system. Sri Lanka, for instance, said that they were very grateful to China, which released them from some of its debt commitments. Is this the world we want to see, where there’s a real geopolitical divide between the West and the Renminbi bloc? 

    KPFL: Do you think the emergence of multiple actors and multilateralization will lead to some cooperation, or the opposite?

    MA: I think the hegemon has been a force for greater disruption. Interest-rate hikes by the US and the resulting capital flight are only worsening the debt burden faced by emerging countries. In my view, the US central bank mandate should include exchange-rate management. That was implicit in the ideas of Ronald McKinnon and others who have been thinking about this idea of hegemonic stability. If the US imposes capital controls, it is going to allow the possibility for exchange-rate management of the dollar which is very much needed.

    LM: In practice, the US Fed is the central bank of the world, but the world has no say over it, nor is the rest of the world really taken into account when the Fed makes decisions. 

    RKW: We won’t see the dramatic demise of the dollar anytime soon. What we have seen is the rise of new players, key among them, China. We have also seen the emergence of new dynamics in South–South relations. That is true of the New Development Bank, which has both a swap dimension as well as a longer term development finance arm. We have seen emerging banks like CAF in Latin America. But it’s still not anywhere near the scale needed to be able to provide a genuine alternative to the existing arrangements. This points to a much more fragmented system. There’s a worry that this could become quite chaotic and ultimately stifle the development agenda. 

    Our position at UNCTAD is that developing countries need to get back to depending more on their own resources. The system we’ve described has reduced the power of developing countries to pursue their own agendas, but they need sufficient fiscal and policy space. We need to see reforms that at least begin to claw back some of this policy space. The relationship between the international financial and trading system becomes very important in this discussion. 

    Everyone’s rediscovering history in this discussion around hegemony: the new Bretton Woods, the Marshall Plan, and Lend Lease. What no one has talked about is the Havana Charter, which was actually the most radical of the efforts to fashion a different kind of international order in the late 1940s. We should be looking hard at the Havana Charter, particularly in light of what’s going on at the World Trade Organization (WTO). It was agreed on in 1948, and had its seventieth anniversary without attracting any attention from the international community. But it was probably the most developmental of all those efforts that took place at the end of the Second World War. In my opinion, it remains hugely relevant for thinking through today’s challenges.

  4. Fault Lines

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    Restarting our economies after the pandemic continues to expose the fragility of our supply chains. The Russia-Ukraine conflict serves as a stark reminder that oil and gas can still spark our anxieties. Commodity prices and our sense of vulnerability are both at multi-decade highs. 

    In Disorder, Professor of Political Economy at the University of Cambridge Helen Thompson places the geopolitics of energy at the core of our current crises. That was not quite the goal—the book was started in 2016 seeking to explain the political and economic volatility of the 2010s. It can be read as a culmination of her years studying the global oil market, monetary policy, and hosting the wildly popular Talking Politics. Most analysts focus on the rise of populism and ascendant nationalism, or the demise of a liberal international order, as the defining features of the time period. But those accounts are largely ahistorical per Thompson. She instead connects how great powers navigate their energy relations to changes in financial markets, and thereby how our democratic systems function. The world she deftly weaves together is one of geopolitics all the way down, as states attempt to garner energy security while capitalizing on both the gains and instability of financial globalization.

    Her analysis recasts pivotal historical moments, from the legacy of the Suez Crisis to the European Central Bank’s handling of the initial stages of the Great Recession, to show us their deep material roots and the inevitable cross-border political spillovers. As she writes in the introductory chapter, “Structural changes around energy and finance always bring tumultuous geopolitical consequences.” It does not bode well for the green energy transition that many of us so desperately desire.

    An interview with Helen Thompson

    NIKHIL KALYANPUR: In Disorder, you paint the shale revolution of the 2010s as a double edged sword for the US. Hydraulic fracking coupled with cheap financing increased the US’ oil and gas output dramatically—the US nearly caught up with Saudi Arabia’s oil exports and started shipping gas to Europe. The growth of the industry increased American energy independence, but it also strained relations with Saudi Arabia and heightened competition with Russia. Were these impacts inevitable?

    HELEN THOMPSON: For Europe, the intensity of the commercial conflict and the geopolitical ramifications unleashed by the shale gas revolution were probably inevitable. At the time of the American shale gas revolution, which began before shale oil, Russia hadn’t diversified much into China or Asia. The Power of Siberian pipeline between Russia and China hadn’t been agreed on, let alone built. For Russia, shale gas was a geopolitical nightmare as the United States secured the capacity to export gas to Europe that would be cheaper than the gas Russia hoped to produce in the Arctic. Shale gas technology also opened up the possibility of more domestic European production, including in Ukraine, at a time when production from the North Sea was declining. Gazprom sought to keep as many European customers as they could at the same time as they attempted to prevent European shale production—including by supporting anti-fracking campaigns across Europe. 

    The Middle East is more complex because the geopolitical dynamics in play between the US and Saudi Arabia in the 2010s were never just about energy. When the Arab Spring started in 2011, Syria descended into civil war and the US and Saudi Arabia were allied against Assad. That alliance held, despite Saudi frustration about shale. 

    There were then two watersheds that strained the relationship between the US and the Saudis. The first was in September 2013, when Obama walked away from his red line about chemical weapons. The second was when the Saudis decided that they needed to bring oil prices down to improve their market share. The most obvious explanation of the Saudi oil move is that they wanted to hurt shale producers, but actually, there was some alignment of interests between the Saudis and Washington over using oil prices to shift Russia on Syria: If the combination of low oil prices and US shale gas hurt Russia significantly and forced it to scale back its commitments to Assad, the move might have improved the situation in Syria for the Saudis. But this didn’t happen: Russia proved able to withstand oil prices. In September 2015, the Russians military intervened in Syria. Meanwhile, US-Saudi relations deteriorated over the Iran nuclear deal. 

    Could the Obama administration have played its hand differently? I think the answer is probably yes. Certainly the Americans could have been more sensitive to Saudi concerns about the nuclear deal, particularly given that it didn’t involve any restrictions on Iran’s activities in Syria. Obama could have been more careful about the way that he created that red line and then walked away from it.

    NK: The book details how the American administration and a number of European governments drastically shifted their views on energy independence over the past three decades. Why was this the case?

    HT: Obama was very adamant about the benefits of energy independence. Relative energy independence would allow for withdrawal from the Middle East and his “pivot to Asia.” In a 2016 interview with Jeffrey Goldberg, Obama says that his decision to walk away from the red line in Syria was a defining moment of his presidency. In his eyes, this was the moment in which he stood up to the foreign policy “blob.”

    While relative oil independence may have given Obama a sense of freedom, he didn’t follow through on that judgment. He himself did not believe the US could withdraw from the Persian Gulf, the centerpiece of Western energy security. Beyond the Gulf, he simply wasn’t willing to let events take their course in the Middle East and say the US no longer has strategic interests in the region. In part this was because the credibility of American power still mattered. By 2014, he recommitted the American military not only in Syria, but in Iraq too against ISIS. 

    NK: Given the geopolitical implications, is there an optimal balance between energy dependence and independence?

    HT: Shale energy introduces a number of complications to this question—regarding the type of oil, the infrastructure and location for its refinement, and its domestic uses. Even though the US was exporting oil from 2015, it was still importing more. Given these complications, the entire concept of a country being able to achieve energy independence doesn’t make much sense. 

    What I came to see in writing the book was just how troublesome shale energy was to the US, in the geopolitical sense, even as it reduced American foreign energy dependency. I anticipated the disruption it would cause to the relationship with Saudi Arabia, but the complex fallout of the competition with Russia in Europe took longer to see. Interestingly, the present moment echoes the oil-based competition between the US and Russia in the first part of the twentieth century. Ukraine was a fault line here both because there was some hope that Ukraine could develop its own shale industry and because Russia was pressing for more pipelines to bypass Ukraine, including Nord Stream 2. At the same time, the United States began to export gas to Europe. 

    In one sense, I think shale complicated the US’ ability to make a geopolitical point out of Nord Stream because the Germans could argue, with some justification, that the Americans only wanted to sell more gas to Europe and that the pipeline was a pretext. If the US had focused only on where the pipelines were going rather than where European gas was sourced, it would have been easier to make the issue about Ukraine’s security. For the US, a reduced level of energy dependence and a resurgence of energy power clearly made some things easier. But it was not a panacea for anything. 

    NK: No one fully foresaw the energy implications of Ukraine. Why have so many scholars and policymakers forgotten about the energy question?

    HT: Beginning in the 1990s, Western politicians found it increasingly difficult to make arguments about energy. This is why we had these strange justifications for the Iraq war—I am reasonably confident it was largely an energy question that drove that war. And if we look at how the other geopolitical players, not least China, perceived that war, it was in those terms. Up until George H.W. Bush, American policymakers didn’t beat around the bush; it was very clear that American intervention in the first Gulf War was related to oil. I think the language of globalization and the optimism attached to the notion that geography could be transcended perhaps thereafter made talking about energy more difficult. 

    The shift within Academia is more complicated. Energy was never that prominent in political economy scholarship, but it was there. As an undergraduate in the ‘80s, I had to demonstrate at least a superficial understanding of the oil price crash of the ‘70s. That started to change in the ‘90s, and, again, it came, I think, from the shift to the globalization discourse. Geopolitics was no longer supposed to matter. 

    But it is an interesting question—I think why political economy scholars didn’t engage more with the energy implications of the 2007-2008 crash, even when oil prices reached historic highs in mid-2008. The crash on the energy side in many ways demonstrated the fragility of the American-led world order. Although scholars were interested in the China demand shock as evidence of a rising China, rather less attention was paid to the stagnation of supply, despite the geopolitical significance of the issues outside Russia and what Russia’s resurgence might mean.

    NK: How does the story you tell in Disorder inform our understanding of the politics of central banks? 

    HT: I am very skeptical about some of  the arguments that were made for central bank independence. It doesn’t make much sense that the primary lesson from the ‘70s was the necessity of central bank independence, given that energy inflation was at the heart of the inflationary crisis at the time. Today’s inflation has also reappeared on the heels of energy inflation, and central banks have to deal with it as if the issues are monetary-generated inflationary pressures that require central banks to be free from democratic pressures.

    I also worry about what the Euro and Eurozone have done to democratic politics in Europe. I saw the removal of Silvio Berlusconi’s government in Italy in 2011 in part at the hands of the President of the European Central Bank (ECB) as a nondemocratic intervention. Mario Monti, who was much more friendly to the ECB, was then appointed Prime Minister. In writing Disorder, I came to see the relationship between the ECB’s quantitative easing (QE) programs and the question of who can exercise political power in Italy as pretty important. It is not really a coincidence that Italy has ended up with a non-elected former President of the ECB as Prime Minister at a time when the ECB has another QE program in place. 

    I am not interested in defending Berlusconi, but the negation of democracy in Italy such that elections can only for short intervals determine who governs concerns me. Italy shows how technocratic claims can overwhelm democratic claims. I’m not necessarily critical of how central banks responded in 2008 with QE and asset purchase programs—it is quite difficult to see what else could have been done—but that doesn’t mean we should turn a blind eye to the problematic consequences, including in the Eurozone for democracies.

    NK: You identify a longer trajectory of democratic erosion in international capital markets and debt issuance, especially in the 1990s and 2000s. If we had lower deficits, would we have the potential for greater democratic renewal?

    HT: Debt places a really serious constraint on democratic renewal. Today, states can carry so much more debt than they ever would have thought possible. This new monetary world around debt makes democratic politics a lot easier, because economically dealing with various crises, like Covid-19, can be shifted onto central banks with no immediate consequences. 

    There is something consequential in the fact that democratic governments had to let central banks take care of the crisis in 2008. Historically, politicians in representative democracies worried about whether democracies would be able to service their debt, hence their interest in citizens being creditors. Financial liberalization and international financial markets took care of that problem of democratic states being able to finance themselves in many ways, but this introduced a whole set of new problems, especially for southern European countries in the Eurozone. And additionally, there are banks’ vast borrowings to deal with. The state must be more responsive to bank debts than its own citizens’ personal debt and the government’s debt. A key example in the US is the scale and duration of the foreclosure crisis. The American federal government didn’t have to worry that much about its own debt and was indifferent to citizens’ personal debt, but it did have to worry about banks’ debts. This is another way in which debt makes the aim of democratic renewal—that would in some ways need to reduce the political importance and influence of banks—incredibly difficult.

    NK: This is one of the ways in which contemporary politics are very different from the 1970s. How much can we learn by pursuing the 1970s comparison?

    HT: I think it does make sense to think about the 1970s, if only to see what the differences are. For Western countries, the ‘70s shows that geopolitical shocks have energy consequences, which then in turn have more geopolitical ramifications as well as economic consequences. Energy shocks are systemic.

    But it’s also wrong to say we’re going through the 1970s again. First, the bargaining power of labor has been significantly reduced since the 1970s. That means that the central bank or political response will be different—and it should be different. Second, oil was at the center of the energy shocks of the ‘70s. This time, we can see that it’s oil, gas, and coal. Third, there are supply side constraints now on fossil fuel energy and a demand shock, particularly on the gas side: China’s demand for imported gas in 2021 massively increased. The ‘70s saw geopolitical supply side problems, and this, because it involves supply and demand, is much worse. Finally, there wasn’t a serious attempt at an energy transition in the 1970s. Today, governments have to present a medium and long term plan for escaping fossil fuel energy, making political choices extraordinarily more complicated than they were in the ‘70s.

    NK: One of the more controversial points of your book is at the end, where you suggest that a green transition will exacerbate the global fault lines you describe. What are we getting wrong? 

    HT: The Green New Deal contains within it hopes that go far beyond energy: for an industrial strategy, for higher growth, and for some change in the distribution of incomes. Perhaps an energy transition can be a vehicle for these other ends, but it’s not going to succeed in those terms quickly. Indeed, the energy transition itself will likely not occur very quickly. 

    The hopes for the energy transition also risks becoming a justification for not having to think about the problems that fossil fuel engines cause in their own terms. Supply is constrained in relation to demand, particularly with oil. The Green New Deal, I think, neglects these questions and leapfrogs directly to the alternative energy sources without facing the here and now. But we don’t know when the technological breakthroughs will occur for the energy transition to succeed. Until a decisive moment is reached with the tech transition, fossil fuel energies’ supply has to be faced. These internal fossil fuel energy issues cannot be dealt with in a haphazard way as if they will take care of themselves because we don’t want to be using oil and gas. 

    There are dual crises going on—climate and fossil fuel supply. I think what is necessary are strategies that think about how the two crises interact, understanding that what you are doing for one will have likely consequences for the other. 

    NK: You’ve called out the importance of low interest rates in facilitating the shale revolution. As these financial-energy linkages continue to shape global politics, should the Federal Reserve or the ECB recognize themselves as geopolitical players?

    HT: The central bankers don’t talk as if they understood the geopolitical implications of their actions. Perhaps this goes back to the question of how we ended up with a technocratic policymaking apparatus, where energy was no longer on the visible surface of politics. The authority of central banks rests on the idea that there is nothing to debate about the purposes of monetary policy: In this view only technocrats should be deciding monetary matters. It supposes there is actually a political consensus when it is not so clear there is. Monetary policy was always supposed to be an issue about price stability, or in the US case, of balancing price stability and growth. But if you allow the possibility that the Fed is going to concern itself with America’s oil supply, and all its geopolitical consequences, it’s pretty difficult to sustain the depolarization narrative. 

    What is interesting, however, is that in the last year or so central banks did take on the green transition language themselves. But I still suggest that they want to pursue the energy transition in a technocratic way, as if there’s a long-term political consensus about how to get there. The trouble is that the energy transition has distributional consequences. This latter part I think we now see very clearly.

  5. Philosophy and Reparations

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    Every new climate study seems to confirm what we have long known: the brunt of these impacts will fall on those least prepared to weather them, in considerable part because the basic structure of our global system had long ago elected these people and places as expendable in service of the projects of world economy. Meanwhile, scholars of past and present injustices—studying issues such as uneven development or vaccine apartheid—uncover the same regularities. There are those who “developed,” and those who continue to indefinitely. 

    Academic philosophy claims both interest and even a kind of specialized expertise in these moral and political problems. Yet the methods of analytic philosophy tend to abstract away from precisely the features of our global predicament that make it so politically knotty and morally troubling in the first place. Why, exactly, are global distributional flows patterned the way they are? What are the inertial forces that lock these flows in place? What precisely is colonialism’s so-called present? And what does it suggest for what we owe each other now and in the future? On these questions, academic philosophy is largely silent. 

    Olúfẹ́mi Táíwò breaks that silence in Reconsidering Reparations, a book of political philosophy that challenges the dominant style and method of the discipline in its richly empirical, historically driven argument for a global reparations project. In Táíwò’s view, reparations are not cleanly rooted in particular injustices belonging to a sharply delimited historical moment. That is, reparations for an institution like the transatlantic slave trade should not be simply conceived of as payments for the atrocities that took place on ports and slaveships from the sixteenth to the nineteenth century. Violent conquest, colonial dispossession, and imperial expansion are, Táíwò argues, worldmaking processes. They built the world we still live in today and in which we are destined to live tomorrow—unless we actively pursue its dismantling and complete remaking. To conceive of the problem in this way is to confront a constructive project of reparations that traces back to the past but is centrally concerned with what prevails here in the present. 

    In the following conversation, Táíwò considers the role of reparations in dealing with the world-altering  fact of climate crisis, and what we must do to have any chance of justice in the future.

    An interview with Olúfémi Táíwò

    LILY HU: In the preface to your book, Reconsidering Reparations, you cite Toni Morrison’s notion of racism as “distraction.”1 In the realm of scholarly production on race, this “distraction” often takes the form of being concerned with other people’s questions, like arguing against Charles Murray’s bell curve argument, or figuring out, as I try to do in my work, the premises of statistical treatments of racism. 

    Your book is about climate reparations, but notably, you don’t follow the various rabbit holes the philosophical work on reparations for historical injustice has gone down. You’re not concerned with the conceptual question of clearly counting who historical victims are. And you don’t get into the nitty gritty of the post-Rawls discourse on global justice. 

    My first question is: do you see your lack of focus on questions that have been deemed important in philosophy as a case of refusing that “distraction” referenced by Morrison? How do you see your work on reparations as a philosopher, walking the line between contributing to an existing philosophical discourse on reparations but also setting it on a fresh course?

    Olúfẹ́mi Táíwò:  I’m less concerned about which questions to focus on, even though in principle I’m willing to make a point about the priority of different kinds of questions. For example, I engage with discussions in the philosophical literature about the so-called non-identity problem, which calls into question whether it makes sense to make reparations to the present-day victims of great historic injustices, who, it is argued, owe their existence to those unjust institutions. The non-identity problem asks: if so many populations would not themselves exist had it not been for these processes of great injustice, can we really say they’ve been made “worse-off” by them? It’s a jarring question, but it has been taken as a substantial hurdle in philosophical debate about reparations and climate justice. I also think there’s a distributional factor around whose questions we take up.

    Lots of people have fought for justice, for the redress of grievances, and for social transformation, sometimes explicitly using the term reparations and sometimes not. I’m not necessarily tied to what academic philosophers have said about reparations, or the idea that it magically overrules the actual history of struggle and activism. It is one thing for scholars to make an intellectual contribution to something and quite another thing for them to assert a kind of ownership over a topic. If we position ourselves as contributing to social discussions and social struggles, I think we will all be better for it.

    LH: Syllabi for philosophy classes on reparations often have a certain kind of structure where they first start off by grounding the course in something like the 2014 Ta-Nehisi Coates piece on reparations and then by week two, they’re back at it with the non-identity problem and a Lockean argument for reparations. It feels like philosophy has this tendency to recognize the wider conversation going on, but then says, “Well philosophers have weighed in on this and let’s do the real work of getting into the guts of the problem.”

    Your constructive view reminded me a lot of the late Iris Marion Young’s work on responsibility for historical injustice,2 as you both categorize the rectification of past injustices as a forward-looking distributive justice project: It’s something that we do for the sake of people who exist now, for the sake of people who exist in the future. In my reading of her account, history has a key explanatory function, illuminating how and why distributive patterns are the way they are, to get the correct diagnosis of present injustices. If we realize the injustice is structural, then we know a one time payment is not going to do the job. 

    Is this explanatory function the primary role of the historical work in your theorizing? What does it mean to get the history right when trying to theorize about what we ought to do politically?

    OT: It is definitely true that there is a kind of diagnostic role for history, explaining why things are the way that they are and letting us use that explanation in thinking about other ways that the world might be. History can play this instrumental role, giving us ideas, and steering us clear of dead ends. But I seek to go beyond the explanatory function of history and argue that history is constantly being made. We are making history. 

    In the book, I am trying to motivate a longer term perspective on politics—the time equivalent of the same move that I make with respect to space, which is the idea that we need planetary scale politics. Those in charge have never been willing to settle for control or influence over what happens in an arbitrary set of borders, but they have sought investments and political control over parts of the world very far away. That is colonialism, that is capitalism, that is your retirement account, that is your system of policing that you live under, that is how your army is trained, that is the world. Getting readers to that scale is my primary motivation for using history in the way that I do in my book.

    LH: The particular historical injustice that your history focuses on is the development of the Atlantic order throughout the seventeenth, eighteenth, and nineteenth centuries. That is a world-making historic injustice. There are clear continuities from that project to the world that we live in now—more than, for example, the various campaigns of Genghis Khan. What do you think about the delineation between world-making and non-world-making historical injustices, and how does temporality inflect those assessments? Older injustices may be perceived as less relevant to the events of contemporary society, or alternatively, they may be perceived as foundational to present-day social arrangements.  

    OT:  It is a position about causal explanation. It is not that the moral dimensions of slavery and colonialism are historically distinctive. Atrocities are very old, and white people did not invent them. The difference if anything is about the particular kinds of atrocities that started in the fifteenth century with the Iberian powers. These events built the world, and that is the difference. 

    Foundationality is a claim about why social advantages and disadvantages are distributed in the world in the manner that they are. In those earlier centuries of geopolitics, the particular institutional actors that were active at that time really did build the world, and they really did create the kind of foundational scaffolding for our own geopolitics—the state system, the industrial revolution, and so on.

    LH: I read your book as making an argument for a particular forward-looking project of distributive justice that needs to be a total remaking of the world. In parallel, it argues that the global system that we currently live in was constructed and follows from this century-long racial empire. If we accept this argument, any forward-looking project will turn out to be a reparative one—it will seek to annihilate the outcome or the patterns that have precipitated from that earlier order. You are interpolating between the two, in the sense that the history can help us understand why the forward-looking projects realize these precise corrections, and it can also help us see why the distributional and the reparative in some sense must come together. 

    OT:  I think that’s exactly right.

    LH: It seems left-liberal or libertarian egalitarian positions argue that requirements of distributive justice ought to take priority over the requirements of reparative justice if they ever conflict. The thought is, we can tell what is unjust by looking at who gets what now, and what justice requires, and we can address those directly, without dredging up the past.

    You argue explicitly against this snapshot view of distributive justice, saying that it under-emphasizes the question of how exactly we got to where we are now. If we look naively at the distributive patterns, it might seem to be mere luck. There are always these toy examples in philosophy papers wherein state A has ten units and B has twelve units, and there’s a tendency to attribute luck to the distributive patterns, rather than seeing them as a result of actual projects pursued by real agents pursuing their real interests.

    This exchange that you have with this snapshot view of distributive justice is relevant to the Rawls-Nozick debate on justice. Rawls’s position is basically that you simply look at the current unjust state of affairs, realize that the just state of affairs is X, bring about X, and then you’re golden. There are replies that we shouldn’t set a historic conception of justice, or that justice is not some fixed state that has to be brought into being. Justice has to be brought about in the right way. A state of affairs that might look extremely unjust on its face could perhaps be vindicated by its history, if it were realized in the right way.

    In Nozick’s view, there is no just goal that you could describe without analyzing the past. I thought that your response to the snapshot distributive justice seems to partly take Nozick’s line on this. It also appears that you acknowledge that certain outcomes are independent of the past. Is your disagreement with the snapshot view theory around the significance of history in determining what justice requires, or is it about the idealizations that the snapshot view theorists tend to engage in as a part of their method?

    OT: I see myself as running towards the Nozick side of that dispute. You can’t judge by end states, you need to judge based on the actual historical processes that produce whatever state people are in today. Where I get off the boat with the Rawls-Nozick debate as it is typically framed is that I am not talking about Country A and Country B in the abstract past, present or future. I am discussing the relations between the United States and Haiti. These are not theoretical, they involve actual distributions and accumulations that have a real history. 

    Rawls starts with an ideal history and theory of justice that is focused on the preferable end state. This is not how the world works. There were centuries of colonialism and wars over the parameters of that colonialism. Amilcar Cabral was fighting the Portuguese Empire at the exact same time as Rawls was writing A Theory of Justice. It was all happening simultaneously. 

    The end state is also not abstract. The snapshot theorists also have a particular way of looking at things from a normative perspective, which I depart from. They suppose that poverty is the only thing we need to respond to—the discrete thing of primary moral importance—but we are dealing with a world with institutional and geopolitical features that caused the poverty, so we must consider poverty beyond just being the end state. It is partially because, for example, the United States has influence on minimum wages in Haiti that poverty is distributed between those countries in the way that it is. The United States military’s decisions on the placement of drone strikes in Somalia, and the number of troops in Afghanistan, shape how poverty is distributed in those regions. A couple GiveDirectly donations will not change that reality. 

    To actually redistribute—not because of the abstract normative priority of certain factors or the end state distribution, but because of the actual causal environment—you must recognize concrete relations. The assumed role of a moral philosopher is to count how many units Country A has, and count how many units Country B has, and wag your finger if those numbers are too far apart. The question of what will actually change those numbers to other numbers is a question perhaps for economists, policymakers, and think tanks. If political philosophy only involves the condemnation of the difference in number of units, then I am not a political philosopher.  

    LH: Teaching the ethics of climate change, I’ve been struck by the number of students that find entitlement-based views attractive and central to the project of climate justice. Many students identify those responsible for climate change and those who suffer disproportionately from it, and they reach for arguments about responsibility and corrective justice. We see the convergence of the broadly liberal egalitarian orientation towards climate justice, which is that the burden should be shared by everyone more or less equally according to their ability to shoulder the burden, but this produces a verdict that coincides with the view about responsibility and unjust enrichment. 

    In this case, all signs are pointing to the same conclusion that it should be the Global North doing more. Students will talk about not simply the capacity to pay now, but they will argue that Global North countries bear a responsibility for polluting so much in the past and benefitting from those actions. Why do you think history is so appealing for people who often work in climate justice? Are you concerned that the broad appeal to history would result in an anti-egalitarian conclusion like the classic Nozickian argument? Or has history been so deeply unjust that it probably would never lead to anti-egalitarian conclusions? 

    OT: It can very easily lead to anti-egalitarian conclusions. This is my deep suspicion at stopping at the history. Increasingly today people approach climate justice from the broader notions of political responsibility. This approach has several great features, but I am uneasy about it. The devil is in what you build, not in what you build on.

    Focus on the past can shift the goal posts in ways that are politically destructive. The most obvious version is when a focus on the past becomes a staging point for symbolism—we are going to take up our share of this global load because our ancestors also contributed to an injustice, and by doing that we thereby achieve holiness, or even absolution. This frame is entirely silent on what actually happens as a result of your taking up this white man’s burden. 

    It is not just the fact that we are acting, but we need to make a difference that helps the people who are made vulnerable by past misdeeds. We need money for green development, and from this premise technical questions begin to arise. Does that assistance come in the form of loans? What is the governance structure of the projects that are run with the money? Who is in a position to even propose projects in the first place? 

    You get into all these details and then all of a sudden you have backed a solution that ends up being a form of greenwashing for major asset managers, who are using sovereign governments of Global South countries to de-risk their investments and forcing the middle classes of these countries to pay user fees for critical infrastructure. All of that was in pursuit of providing funding and help to the poor and downtrodden. There’s a focus on responding to the past rather than equally being weary about the present. This makes things worse, or fails to improve things in a meaningful way. I think history, even good history, is potentially ripe for misuse.

    LH: Reading history you have the sense that every single regime has seemed permanent, has self-justified, has calcified, completely frozen in time. Yet the task of a historian is to draw out how all of that is contingent, even though it can seem totalizing. I think for all of us living in the world, this is an extremely valuable lesson. Doing good political philosophy also requires a better sense of the possible and the feasible than is currently accepted. How has your interest in history changed your perspective on philosophical work? 

    OT: In a lot of ways, I think my interest in history is what brought me to philosophy. My perception of philosophy as an undergraduate was that it was very concerned with history. A lot of the people that we read in those early courses seemed to be very interested in understanding the world around them at a high scale of generality and tried to put things together. Going into graduate school, my impression of what philosophy entailed was something of a surprise. I think there is space to do philosophy in this way, and I prefer it.

    It is one thing to be able to imagine things differently, but it is another thing to know as incontrovertible fact that they were different. What seems normal now was, in fact, produced, and what seemed normal before was also produced. 

  6. Tax Regimes

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    Tax cuts and austerity have been a central feature of American politics in recent decades—just recently, the Build Back Better bill was blocked under the guise of fiscal responsibility. The work of Robin Einhorn, Preston Hotchkis Professor in the History of the United States at UC Berkeley (emerita), makes sense of these dynamics. Through a broad historical perspective, Einhorn has shed light on Americans’ complicated relationship to taxes: from the colonial period, through the American Civil War, to the tax revolts of the 1980s.

    Einhorn’s 1991 book, Property Rules: Political Economy in Chicago, 1833-1872 examines the fiscal history of Chicago in the nineteenth century and shows that a period traditionally associated with the rise of American democracy was in fact dominated by the interests of property owners. Chicago’s city government prioritized the developmental priorities of this group and avoided the democratic politics of redistribution. Einhorn’s second book, American Taxation, American Slavery, argues that hostility to taxation in America originated with slaveholders who worried about protecting their property from non slaveholding majorities. Whereas northern colonies developed comprehensive property tax systems, enforced by local officials, southern colonies create a lenient tax code friendly to the growth of slavery, with long term consequences for American state institutions. More recently, she has been working on the origins of the Federal Income Tax and the rise and fall of American tax regimes in the twentieth century.

    In this post, Noam Maggor interviews Einhorn on the role of regionalism in shaping the history of the American fiscal state.

    An interview with Robin Einhorn

    NOAM MAGGOR: How did you first become interested in the history of tax policy?

    ROBIN EINHORN: I grew interested in taxes the historian’s way: I discovered it in an archive. While writing my dissertation, the Illinois State Archives uncovered the archives of the City Council, which were thought to have been destroyed in the Great Chicago Fire of 1871. They were not yet calendered or indexed, so to know what was in them, I had to read through them. I started where they started, in 1833. By the 1840s and 1850s, an over whelming number of documents were about a tax policy I had never heard of, called “special assessments.”

    Chicago was growing explosively during that period, and required significant infrastructure investment: streets, bridges, sidewalks, lighting, grading, and paving. Most of this was paid for through “special assessments,” which, I discovered, were levied or collected from property owners who were expected to benefit in higher property values as a result of the investments. Beyond financing, property owners developed decision making procedures around which industries and projects deserved funding and how. The title of my first book, Property Rules: Political Economy in Chicago, is based on the fact that Chicagoans did not calculate the number of people taxed for a project, but how much property they owned. 

    As a result of special assessments, municipal government functioned very differently from what the historical literature at the time described. This made me realize that the structure of tax policy is a blueprint for understanding the functioning of government, and of politics. Special assessment, and the process of decision making around it, weres designed to avoid interest-based politics. It was an economist’s dream—a system that sought to avoid distribution and avoid a politics of redistribution.

    NM: Why were they so worried about the politics of redistribution?

    RE: In mid-nineteenth-century America, many aspects of government were structured in a manner which bypassed public debate. One of the most highly regarded state-level laws among economists was the “uniformity clause,” which stated that all forms of property had to be assessed the same way and taxed at the same rate. Well, why would you want to do that? Economists in the twentieth century argued that the clause would ensure that industry paid its fair share. This was a story about democracy in the West, in line with Frederick Jackson Turner’s famous frontier thesis. 

    I made a list of the order in which states inserted this clause into their constitutions, and found that the economists had it wrong. The first state to develop this rule was Maryland, in 1776. A series of southern states, along with Illinois, which had slavery at the time, followed. When I looked at the language, I noticed new peculiarities: in Tennessee, the clause stated that “no one species of property on which a tax shall be collected, shall be taxed higher than any other species of property of equal value.” As a nineteenth century historian, I knew that the term “species of property” was a reference to slavery. Through this process, I realized how important slavery was to these uniformity clauses in state constitutions. 

    NM: It is useful to think of fiscal history as a story of struggle over the demarcation of spheres for legitimate public debate. This is especially interesting in the American context, where propertyless citizens had the right to vote, and consequently we see the emergence of these protected decision-making spheres. We could frame the entire fiscal history of the United States in the nineteenth century around the efforts of those who own the property to shield themselves from public arenas where they would be forced to negotiate with the rest of the population over how to distribute burdens and rewards.

    RE: The upper South states in the 1830s and 1840s are a perfect case of that. With the elimination of property qualifications for suffrage, a growing number of non-slaveholding yeomen in the western parts of North Carolina, northern Georgia, or eastern Tennessee, were enfranchised. They demanded more representation in the legislature. They want reapportionment, which slaveholders feared would lead to the abolition of slavery. The yeomen wanted roads and schools, the slaveholders worried they would tax slavery out of existence. This is the fear expressed by Hinton Helper in the Impending Crisis, a book which spread through the South in 1857. 

    The deal became that reapportionment in the legislature could take place only if the non-slaveholders agreed that their land and livestock would be taxed at the same rate as slaves and land and livestock. They could try and get their roads and schools, but not by taxing slavery at a higher rate. 

    NM: You are describing an interesting dialectic between elites who were trying to protect themselves from redistribution, whether they were in Chicago or Maryland, and democratic constituencies who are bent on expanding government spending, building infrastructure, and providing education. What were the differences between this sort of legislative infrastructure in the North and South? 

    RE: As early as the seventeenth century, Northern colonies had sophisticated regimes of property taxation. Local assessors, who assessed property values for the purposes of taxation, struck deals with local property owners to develop rules that were fair enough and served public purposes. Assessment has been described as both an art and a science—I think it’s a politics. 

    In the South, the laws did not make room for local politics. They did not assess the value of real estate before the American Revolution at all. Instead, they had flat rates per acre, which meant that high value property paid the same as low value property. They had flat rates per slave, sometimes in age and sex categories. These were rules set by the legislature, not local assessors. Why didn’t they do the assessment? My answer was that they couldn’t do local politics.

    NM: What were the long term implications of this divide between North and South for American institutions? You, and others, have argued for the resilient legacy of slavery in modern America. I am more skeptical, because the South lost the Civil War and the northern bourgeoisie grew immensely powerful.

    RE: Waging and losing a bloody civil war had consequences. One consequence was the protective tariff, which was a huge redistributive engine from South to North. We joke that the South won the Civil War, because they established white supremacy within a couple of years. At the same time, the North constructed this tariff designed to protect and foster Northern industry at the expense of Southern cotton growers and Western wheat producers. At this point, the tariff constituted half of all federal revenue, yet it was still a small part of an expansive subsidy system. Douglas Irwin has done brilliant work on this and found that a full 8 percent of US GDP was redistributed, mostly from the South to the Northeast. The West was paid off with a system of pensions for Civil War veterans, but the veterans of the treasonous army of the Confederacy were not included. So as a result of losing the war, the South had to help subsidize American industry.

    NM: This is striking because the Jim Crow system increased the South’s political power in Congress —they now counted all African Americans for purposes of representation instead of three fifths of the slaves. Additionally, as Ira Katznelson showed, the South often voted together as a unified bloc in Congress. And yet, they were not powerful enough in those decades between the end of the Civil War and going into the twentieth century to overturn the hegemony of the pro-industrial Republican Party. Were there important legacies of the antebellum tax systems?

    RE: During Reconstruction, Southern state constitutions were rewritten such that their property taxes resembled Northern property taxes. Southern local government was reformed. However, voting rights were narrowly circumscribed. By the 1890s, African American men could no longer vote in the South among other disabilities that were imposed on them. But you are not going to find continuity in the tax instruments.

    NM: This brings us to the origins of the modern income tax. Scholars liked Elizabeth Sanders and Monica Prasad have traced the origins of the progressive income tax, alongside other reforms such as antitrust, corporate regulation, and the Federal Reserve, to the agrarian periphery, to the West and especially the South, Sanders points in particular to the Democratic triumph in the election of 1912. In her telling, the “Roots of Reform” originated there. 

    RE: The early income taxes, like the Income Tax Act of 1894, the one voided by the Supreme Court in the Pollock case, and the one enacted after the Constitutional amendment in 1913 were not like our income tax. They were levied only on the rich. Southern politicians understood correctly that these early income taxes would not affect the South, because there were few income taxpayers there.

    In 1916, New York State paid 45 percent of the personal income tax—this was its purpose. Southerners viewed it not as a working class triumph, but as a way to offset the redistribution of the tariff, by redistributing from the wealthy industrialized corporate North to the agrarian South. So there were two different political regimes favoring this federal income tax: the industrial working class in the North, and the Southern victims of the tariff regime. 

    NM: The South as a whole in this period was also poor, so redistribution across regional and class lines went hand in hand. The transition to an income tax, in US and elsewhere, has been viewed is pivotal for the emergence of modern states. Could the tariffs have generated the revenues for a welfare state?

    RE: The tariff was equipped to provide a massive pension program for Northern veterans. It produced budget surpluses every year that were quite embarrassing to Republican protectionists. They were desperate to invent ways to spend it, and that’s one reason why these pensions were so generous. The tariff also financed a massive naval build up, and most of the cost of the imperialism of the Spanish American War. So the problem with the tariff was not insufficient revenues. 

    Additionally, advocates for the income tax did not necessarily envision it providing a new scale of government revenue or supporting a modern welfare state thirty years later. The financial revolution that made the welfare state possible was the Second World War, when the income tax transformed from a tax on the very rich to a tax on just about everybody.

    NM: Nevertheless, it is difficult to downplay the significance of the income tax as a major pivot in the emergence of modern states, in the United States but also elsewhere. What do you make of the constitutional amendment that was necessary to enact the income tax? 

    RE: The passing of the 16th amendment is an amazing story. First of all, why did the United States need it? The answer is of course the three fifths clause of the Constitution: “Representatives and direct taxes shall be apportioned” according to the number of free persons “plus three fifths of all other persons.” The direct taxes that were contemplated in the framing of the Constitution were slave taxes. It was the same as the uniformity clause debates in the States. This remnant of slavery in the Constitution was upheld by the Supreme Court in 1895. In the case of Pollock versus Farmers Loan and Trust Company in 1895, the Supreme Court said that Southern Democrats could not tax the fruits of Northern industry.

    NM: The Constitution was a pro slavery document, and it made the enactment of the income tax difficult, hence the need for an amendment in the first place. Nevertheless, I am struck by the irony that Southerners were begging for a progressive income tax, and a Supreme Court dominated by Northerners used the clause as grounds for nullifying it. Your own essay on the income tax demonstrates that the earliest states to ratify the Sixteenth Amendment were from the South, with Alabama famously being the first. Opponents of the Amendment used the race card to try to scare southern legislatures. They argued that a Federal government that could scrutinize income would also be able to interfere with Jim Crow, but this did not work. The economic redistributive implications of the income tax mattered more. Wasn’t the income tax part of a broader legislative package that aimed to empower the federal government in new ways?

    RE: In different ways. Much of American history proceeds as if the late nineteenth century is somehow characterized by laissez faire. The ‘Gilded Age’ is assumed to be the heyday of business unfettered by regulation. More accurately, the late nineteenth century was a heyday of laissez faire theorizing, primarily by people who hated the tariff. Men like William Graham Sumner were not stating that we have laissez faire, but that we want laissez faire because we have extensive government control over large swaths of the economy. Somehow, we confuse these demands with what actually existed. We assume that the construction of the welfare state was the origin of government intervention in the economy, but this is incorrect. It was a change in the form of intervention. 

    For a period of several decades in the middle third of the twentieth century, there was downward redistribution, which was unique. The welfare state was not a departure at the level of active governance. There was pro-industry government intervention throughout this heyday of laissez faire theorizing.

    NM: Stefan Link and I have also argued that the United States has an incredibly effective “developmental state” in the late nineteenth century. Why is it, incidentally, that critics of protectionism like Sumner or Edward Atkinson or David A. Wells were not Southerners?

    RE: Before the Civil War, Boston and New York were the centers of international trade. As centers of international trade, they were allied with the South before the Civil War. They were opposed to the tariffs later because import and export is a major business which was harmed by trade barriers. Generally, the late nineteenth century was not a period in which major thinkers were from the South; Sumner was at Yale.

    NM: You have outlined three different tax regimes: the antebellum regime that preceded the Civil War, the Republican regime of the late nineteenth century, and a Democratic regime that came into being in the early decades of the twentieth century. This is quite a complicated arc, and it seems like Southerners supported or opposed taxes depending on their economic interests. 

    Let’s skip forward a bit, to the end of the New Deal fiscal regime. How should we understand its demise? 

    RE: Several developments led to the tax revolts that began in 1980.  In the second half of the twentieth century, there had been massive redistribution toward the South through the New Deal, rural electrification, and the military industrial complex in the South and the West. 1980 was the first year in which Southern states paid as much federal individual income tax as the rest of the country. The South no longer benefited disproportionately from the federal income tax, and their interests changed. Another thing that happened by 1980 was the civil rights revolution. Public facilities had to be open to Black people, and this led to retrenchment at the state and local level throughout the South. 

    NM: Every tax regime you have described had its own internal contradictions. Here we see a New Deal state investing disproportionately in the periphery, and in doing so sowing the seeds of its own destruction. As the South became part of the prosperous Sun Belt, affluent voters there began to act more like affluent voters in other parts of the country and moved away from their support for the income tax. 

    RE: Historians of the South in the second half of the twentieth century such as Matthew Lassiter have argued against Southern exceptionalism, as well they should, because this is the period when the South indeed became less exceptional.

    NM: My last question is about situating the US in comparative perspective. Thomas Piketty has found, perhaps to his surprise, that the US in the twentieth century had higher tax rates than Germany and France. How do we square this with the pervasive idea of the US as particularly averse to taxation?

    RE: The American federal tax system is still more progressive than the tax systems of its European counterparts. It has become much less progressive than it was when the marginal rate on the highest incomes was 90 percent, but it’s still more progressive. The reason it is more progressive is that the United States does not have a value added tax. Value Added Tax has been a tremendously productive revenue engine in Europe. Many scholars view the VAT as part of the social democratic consensus—workers pay this regressive tax in exchange for the benefits from a welfare state. Republicans in the 1920s came close to replacing the income tax with a national sales tax, but they narrowly missed being able to do that.

    Piketty wants to say: you introduced progressive taxation before, you can do it again. But we cannot have the alignment of the early twentieth century today. The past is a record of things that have been tried and coalitions that have been built, but trying to rebuild a coalition from the past is not going to work. 

    NM: There is clearly no point, or desire, to resurrect old coalitions, but our conversation has shown that the history of taxation is incredibly dynamic.  The goal should be to look for new alignments and opportunities.

    RE: A progressive coalition for today has to emerge from the way the country is shaped today.

  7. Structures of History

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    Few scholars have had the theoretical, methodological, and empirical influence of William Sewell. His work has persistently scrutinized and challenged disciplinary barriers, placing historical and social scientific methods in dialogue and thereby illuminating their strengths and shortcomings. This effort is most pronounced in his 2005 book, Logics of History, which assembles deep and profound reflections on scholarly understandings of time, contingency, and path dependence. It’s in this text that Sewell presents his much cited conception of structure as a multiplicity of “schemas and resources” which combine and intersect in unpredictable ways, and makes the case for an “eventful” temporality which appreciates radical and sudden historical transformations.

    Sewell’s historical work has integrated this intricate theoretical framework. His first book, Work and Revolution in France: the Language of Labor from the Old Regime to 1848, traces the transformation of corporate artisan traditions through the French revolutions of 1789, 1830, and 1848. His subsequent book Structure and Mobility: The Men and Women of Marseille, 1820–1870, draws on marriage registers to paint a complex sociological portrait of Marseille throughout the nineteenth century. And his third major work, A Rhetoric of Bourgeois Revolution: The Abbé Sieyes and What Is the Third Estate? situates the influential pamphlet and the ideologies of its author within a broad economic, social, and political context.

    William Sewell is Frank P. Hixon Distinguished Service Professor Emeritus of Political Science and History at the University of Chicago. In this interview, we discuss the course of his intellectual development, the state of contemporary historical and social scientific research, and his new book, Commercial Capitalism and Civic Equality in Eighteenth-Century France.

    An interview with William Sewell

    MAYA ADERETH: Let’s begin with your academic trajectory. What have been your main theoretical influences?

    WILLIAM SEWELL: I should begin with the first influence—my father. He was a sociologist at the University of Wisconsin. He was one of those sociologists who wanted to transform the discipline into a genuine science. He used to talk to me about sociology quite a bit, especially when I was a teenager, so I actually grew up steeped in quantitative sociological thinking. I did my undergraduate work the University of Wisconsin and began as a Sociology major. But as I got some distance from my father and took some intriguing courses in history, my interests expanded beyond quantitative methods and outside of the US context. American Sociology in those days was mostly sociology of America in the present. History, and in particular the history of Europe, seemed much more interesting. Ultimately I majored in history, but preserved the sociological knowledge—theoretically in my thinking about how societies are structured, and methodologically through my background in mathematics and statistics. 

    I wanted to do a kind of social history based on sociology. But as far as I knew, nobody was teaching that in history departments. So I opted for what seemed to be the closest thing: economic history, which I pursued at Berkeley, studying with David Landis, Henry Rosovsky, and Carlo Cipolla. Of course, I had to take quite a bit of economics and some statistics, so for a historian, I had a broad and deep background in quantitative methods.

    In graduate school, I consciously pursued a form social history that was allied to economic history. While developing my dissertation project, I was particularly influenced by Charles Tilly’s The Vendée and E. P. Thompson’s The Making of the English Working Class. I was impressed with the archival depth and historical methods they both used. My dissertation was on the history of the working class in nineteenth-century Marseille, particularly around the revolution of 1848. I focused especially on the experiences of workers who had immigrated to Marseille from the surrounding countryside and small towns, something I was able to track by using demographic records. Workers who were migrants turned out to be far more likely than native born workers to be active in revolutionary activities in 1848.

    But where did my interest in revolution come from? Well, besides having great economic historians, Berkeley in the early 1960s was a very radical place. There was a kind of mini-revolution there in 1964, generally known as The Free Speech Movement, against the University’s policy of forbidding political activity on campus. The Free Speech Movement was extremely exciting—a student strike I was deeply involved in as a Teaching Assistant actually shut the university down and forced the administration to change its policy when the Faculty Senate weighed in on our side. In retrospect the Berkeley revolt seems a bit of a tempest in a tea pot, but the experience was very intense. I realized, on the basis of my own experience how one’s frame of reference could be transformed in a revolutionary situation. Things that I hadn’t thought imaginable would become possible in the space of a few intense days of struggles. It was through this movement that I recognized the volatility and unpredictability of revolutions, and the contingency of historical development that they epitomized. In one way or another, I’ve been studying revolutions ever since.

    I was hired as an instructor at the University of Chicago in 1969, when I was still doing my dissertation research in Marseille and before I had written a word of my thesis. I wrote my dissertation over a period of three years, while teaching full time. I dug into the quantitative evidence I had compiled, discovering many details about how people lived, what their social and family relationships were, and so on, but also (using arrest records) who had been active in insurrectionary activities. But during my Chicago years I also realized that quantitative history didn’t help me figure out what people were thinking or how they understood their experiences. I of course had archival and printed material that bore on details of workers’ social and political lives, but I had only limited access to how their understood their experiences and how they responded to revolutionary situations. While at Chicago, I grew interested in anthropology, which dealt with the thought-worlds and experiences of ordinary people and helped me to interpret the scraps of evidence I had. Teaching a joint course with Bernard Cohn, an Indianist who had a joint appointment in Anthropology and History, was very illuminating, as was doing joint teaching with Ronald Inden, another historian of India who was steeped in anthropological theory.

    In 1975, I got a five-year pure research appointment at the Institute of Advanced Study, in Princeton, New Jersey, where my senior colleagues were Clifford Geertz and Albert Hirschman. Those were heady years. I soon put off my big book project on the workers of nineteenth-century Marseille. (In fact, that book never got written!) During my first year at the Institute Clifford Geertz had assembled a team of anthropologists who organized a seminar on symbolic anthropology, which I attended. One thing I had noticed in my research on Marseille’s workers is that they used vocabulary redolent of the corporate system of old regime France when referring their trade union organizations, which were very active in the revolution of 1848. Anyone who worked on the nineteenth-century French working class had seen this language all over the place, but no one seemed to have tried to make sense of it. In the context of the symbolic anthropology seminar, I decided to write a paper on that subject which turned into my first book.

    The book explored the significance of the apparent anomaly that proto-socialist revolutionary workers were making their claims partly in pre-revolutionary old-regime language. I soon recognized that the solidarity understood by these early worker socialists was an extension to the entire working class of the corporate sense of solidarity to individual trades that they had inherited from the old regime. The book traced how this bit of conceptual and political magic happened, above all in the Revolutions of 1830 and 1848.

    After my time at the IAS was up, I joined the History Department at the University of Arizona. The Arizona History Department had a handful of interesting colleagues, but I quickly learned that two floors up in the same building was a really excellent Sociology department, including several younger scholars who did various forms of historical sociology. Over my five years at Arizona I found that my intellectual life moved up from the first to the third floor. So after a twenty year absence, I re-entered the intellectual world of sociology—but now historical sociology with a strong dose of social theory.

    This sociological turn was solidified in 1985, when I left Arizona for the University of Michigan where I had a joint appointment in sociology and history. There I also hooked up with anthropologists and wound up chairing an interdisciplinary outfit called the Committee for the Comparative Study of Social Transformations. It brought together historians, sociologists, political scientists, anthropologists, and eventually people from literature and philosophy departments, all of us struggling combine the linguistic turn with social science. It was a heady mix that greatly stimulated my interest in social and cultural theory.

    My final academic move was back to the University of Chicago, in 1990, where I was recruited by the Political Science Department, but with a joint appointment in History. In the department I came to think of myself as the “refugee professor.” That is, I took under my wing many students who had come to study political science because they were interested in politics, but found that they instead were supposed to do political science, which is something quite different. But as refugees from conventional political science they could legitimately work with me and get political science degrees. It was an extremely diverse group, who worked on topics ranging from European urban forms, to political cartoons in Turkey, to the politics of art in postwar Germany, to South Korean democracy movements, to concepts of development in China, to nationalist music in Norway, to name a few. They were probably the most interesting students I ever taught, and I learned an enormous amount from them.

    I can see that in some ways, my own intellectual biography mirrored the theoretical framework about eventful history that I was developing. My trajectory, from sociology, to history, to anthropology, back to sociology and eventually to political science, was shaped by a sequence of highly contingent encounters and events as I moved from one university to another. It made me a particularly interdisciplinary social scientist.

    MA: What has been your relationship to traditional historical sociology?

    WS: I’ve tended to be critical of comparative historical sociologists at the same time as I’ve been very engaged with them. My critique of historical sociology is that it often doesn’t take the history part as seriously as it should. Unfortunately, sociology is a field that’s dominated by methodology, and historical sociologists try mightily to formalize the historical, particularly through things like comparative methods or process tracing. The work and thinking that is done along those lines is of course valuable, but I think it also cuts off a sense of the radical contingency of the world, which is what drew me to the study of history in general and revolutions in particular. Of course, even in revolutions there are elements of continuity and of strategy, but people also act in ways that they never thought they would be capable of acting before. People’s very conceptions of what is possible are transformed by historical experience. Unpredictability is a key feature of social life. So while we certainly need theoretical rigor, we also need to be able to account for radical transformations. Ultimately, over-formalizing history seems to me a bit of a fool’s errand.

    My most cited article is on the theory of structure—I argued that while structures are real, they are also transformable. And they are transformable particularly because they are made by humans, both through practical activity and through reconceptualizations that such activity imposes over time. I try to be especially sensitive to the conceptual turning points that happen in social life. Life is full of events, some of which change institutions and therefore the world.

    MA: My feeling is that today there’s a tendency either to abandon all aspirations towards causal research and focus exclusively on descriptive accounts, or to focus too much on causal narratives so that questions on revolutions, historical change, and so on are not viable. Where is the right place to be in the search for causality?

    WS: I certainly think that there are very important causes working in the world. My most recent book talks about how capitalist development shaped people’s experience of the world in eighteenth-century France. From the perspective of world history, the emergence of capitalism is a hugely contingent event. But from the perspective of eighteenth-century France, capitalism was a continuing feature in the background of social life. Despite shaping many aspects of people’s lives, the effects of capitalism are not consciously conceptualized until the emergence of political economy in the eighteenth century.  Political economy, at least implicitly, breaks with the traditional framework of the nobility, fixed social hierarchy, monarchy, and so on. But throughout much of the eighteenth century, while capitalism it is actively structuring the lives of people, especially in cities, they don’t consciously conceptualize it.

    If we take something like the emergence and increasing dominance of commerce in the eighteenth century, that was a roughly steadily increasing force. It has fluctuations, but the arrow is headed upwards. And it turns out to be a very important background that makes possible the reforms of the French Revolution, many of them based on ideas in political economy. But because the advance of capitalism was a slow-moving background force, historians have tended to ignore it in thinking about the origins of the Revolution. In this case, I’m making a sociological critique of conventual history—historians do have a habit of following the surface of events. So I guess I find myself moving between the typical sociologists’ emphasis on social structures and historians’ emphasis on more self-conscious purposeful action.

    neil warner: That’s a good place to pick up on your latest book. One thing I really liked is your argument on Habermas—you argue that his idea of the public sphere has been misinterpreted in its application. Can you talk a bit about that argument?

    WS: I think it’s been especially misused by historians. They’ve taken this notion of the public sphere, and used it to look at the press, spectacular events, people’s ideas, and so on. But the early Habermas was a Marxist, and what historians don’t pick up on is his very strong sense that the very possibility of a pubic sphere is based on the early development of capitalism. So the public sphere itself—cafés, newspapers, books, theater—is structured by capitalism in a very direct way. These are all commercial developments, and the commercial aspect, Habermas argues, is crucial to the emergence and the structures of the public sphere.

    nw: Another theme I was interested in is the role of the professions in shaping the historical developments. What are your thoughts on that?

    WS: There were not many genuine professions in France in the eighteenth century—lawyers and doctors constituted about the only organized professions. However, in writing the book I became really interested in the role of the royal bureaucracy. They were something like a profession in the sense that they had some kind of high secondary education, but this occupation was open only to nobles. In particular, they were people whose families bought their way into the nobility in the seventeenth or eighteenth century. My interest was in how these bureaucrats turned to political economy as a means of overcoming the impossible situation they were in. As royal bureaucrats, they had to come up with enough money to keep the war machine going, but they couldn’t tax the nobility and were aware that further taxes on the peasantry would have counter-productive economic effects. I was surprised by the progressiveness of these royal officials in navigating this task.

    They had to find a way of providing greater income to the masses. In order to do that, they had to increase the productivity of the economy (they didn’t use the term “the economy,” they referred to it as “commerce”). They figured that by getting rid of restrictive regulations and letting commerce flourish, via manufacturing and trade, incomes would rise. And once incomes rose, they could raise taxes and keep the state afloat. This sounds very cynical: grow the economy so you can fund the military and stay in power. But I don’t actually think they had cynical motivations. They thought economic growth would both make common people more prosperous and strengthen the state. They really thought that liberalizing rules and making it easier for people to engage in trade would increase people’s wealth, happiness, and numbers.

    nw: Jumping forward a few hundred years, one thing that runs through a lot of your work is the desire to break the dichotomy between cultural and material explanations. Could you comment on that with respect to contemporary debates on, say, the rise of populism?

    WS: There’s no doubt that there’s something about the nature of the contemporary economy that has broken working class and agricultural communities. Growing up in Wisconsin, I remember driving by all of these lovely idyllic farms with their red barns back in the 1950s and 1960s. When I drive around in Wisconsin today, those same barns are falling apart. There has been a huge economic change, and many sectors which used to offer a fairly good life to people have been crushed. But this economic change is also a cultural change—small farmers in Wisconsin used to share equipment or help one another with the harvest. There was a lot of common work and exchange of that sort, and towns reflected these relationships and a sense of common purpose. When we go into many small towns today, they don’t have the small stores that facilitated social life; they are devastated. There are far fewer local level interactions; people are more likely to do their shopping at big box stores in the nearest city. This sounds like a sentimental picture of rural Wisconsin, but there was something there that is now gone. And the cultural aspect is that people are deprived of community at various levels. You can say the same thing about the former industrial towns in the Rust Belt.

    This is a very Thompsonian perspective in a way: there were real communities that have been shattered by neoliberal development. And this process has gone unrecognized by the political discourse we’ve heard from Washington DC and London. People have a sense that those in power don’t give a damn about them. We see this reflected in our cultural life—going back to Wisconsin, the University of Wisconsin had a huge agricultural school, where they taught animal husbandry, dairy science, etc. One ideological and material function of the University was to provide knowledge to farmers; there was a strong relationship between the University and the people in the countryside. Those sorts of ties are also completely gone. The big ag companies lease most of the farmland and dictate the farming methods. So there’s an overwhelming sense of abandonment and disconnect, which breeds resentment. Rural people now tend to think the University is full of stuck-up people who despise them. We can see similar things across Europe—the yellow vests in France are an expression of it, with uprisings and violence directed at sources of capital. The embrace of Trump in the US comes from a similar impulse.

    MA: If we’re to think then, of some sort of history of the present, I think these moments in the 1960s, then the 80s and 90s that you’ve spoken about are all recognizable turning points. There’s a feeling now like we’re at another turning point. What other structural features should we be paying attention to when we analyze the present moment?

    WS: One thing we should be paying far more attention to in the study of society is climate change. We’re nowhere near limiting it, let alone eliminating it, and it’s bound to have dire consequences for social life. For example, it will become increasingly difficult for people to live in warmer parts of the world: Sub-Saharan Africa, India, the Middle East, Southeast Asia, Central America, South China. There will be huge waves of migration, or attempts at migration, from the Global South, and at the moment, it’s not clear that any state is prepared to handle that. We see beginnings of this situation already with Libya and the EU. The EU is collaborating with Libyan authorities and militias to keep migrants from coming from Africa. But this is just the beginning.  And likewise, at the southern border of the United States, people are fleeing from repressive states in Honduras, El Salvador, Guatemala, but this is compounded by pressure from climate change. People can no longer live off of their farms.

    That’s not a very hopeful outlook, but on the other hand, there is a growing climate movement. And I think it’s clear that some sort of reversal or transformation of neoliberalism, and capitalism itself, is absolutely necessary. Capitalism as we know it, from the sixteenth and seventeenth century up to the present, has relied on continuous global expansion, both territorially and in terms of resources. Particularly since the early nineteenth century, it has relied on tremendous amounts of fossil fuels. This increasing commodification of the world has to be stopped in some way; it’s beyond what the Earth can stand. So it’s not just about climate, it’s also about finding dignity for ordinary people.

    We can predict climate change with a high degree of certainty, because it’s not just a matter of human institutions. There are there are physical forces involved which are inexorable. But the human side of it, that is unpredictable. And so long as it’s unpredictable, there is hope.

  8. Power, States, and Wars

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    Over the course of several decades, sociologist Michael Mann has studied great powers and the social orders they create. Combining a theoretical and empirical focus, his work is nearly unparalleled in its ambition of scope and meticulous attention to detail. His four-volume magnum opus, Sources of Social Power, takes a sweeping look at power dynamics underpinning human societies from the Neolithic Era through the aftermath of the 2008 financial crisis. Elaborating on the work of Max Weber, Mann distinguishes power into four types—ideological, economic, military, and political (IEMP)—which interact with one another but preserve an essential autonomy and operate through different means. With the IEMP model, Mann disaggregates concepts like states, nations, and societies to understand the interlocking networks of power operating within and between them.

    Mann’s other work applies this theoretical framework to some of the most challenging features of human societies. His 2003 book, Incoherent Empire, considered the balance of resources available to the US at the turn of the century, accurately predicting many of the country’s recent international tribulations. The following year, Fascists presented a sociological analysis of fascist movements in Italy, Germany, Austria, Romania, Hungary, and Spain, explaining the ideology’s rise following the First World War. And in 2005, The Dark Side of Democracy examined the circumstances surrounding ethnic cleansing in Armenia, Nazi Germany, Cambodia, Yugoslavia, and Rwanda. His forthcoming book, On Wars, analyzes the history of wars in the Roman Republic, China, Japan, Europe, Latin America, the Middle East, and the United States.

    Michael Mann is Honorary Professor and Director of Research at the University of Cambridge and Distinguished Research Professor at the University of California, Los Angeles. We spoke with Mann in January about the study of history, the autonomy of states, and the budding reemergence of great power politics.

    An interview with Michael Mann

    MAYA ADERETH: Tell us a bit about your intellectual trajectory.

    Michael mann: I got into sociology almost by accident. I did an undergraduate degree in history at Oxford, and then trained as a social worker. That training included a course in sociology, which I fell in love with. I managed to get a PhD position at Oxford and started doing very concrete empirical research; I did my dissertation on a factory relocation from Birmingham to Banbury. After that I went to Cambridge and continued to do empirical work, I studied the experiences of a large sample of workers in the labor market of Peterborough. When I got my first teaching position at Essex University, I had to teach courses on subjects I knew nothing about, like sociological theory. I remember that in the interview they asked me if I could teach a course on the Enlightenment. I said of course, wondering vaguely what the Enlightenment was.

    This set me off on a theoretical path, even as I continued to do empirical work.  I wrote an article, which I never published, comparing Marx and Weber’s theories of social stratification. My involvement in the campaign for Nuclear Disarmament persuaded me to add a fourth form of power, military power. That’s something that remained distinctive to my model—that there are four sources of social power, not three as identified by Weber or Althusserian Marxism’s three levels of social formation.

    So I thought I would explore this idea through some empirical examples. With what little I knew about ancient societies, I wrote an article called “States Ancient and Modern,” from which my distinction between despotic and infrastructural power is probably the most cited idea of all my work. That developed into an idea for a short book examining a couple of historical case studies and comparing them to contemporary forms of social power. As I worked on the chapter centered on Rome, the project just grew and grew. The earlier case studies developed into the first volume of the Sources of Social Power, and my theory kind of evolved with the cases I confronted empirically. The other volumes followed, with only slight changes to the model, and I finished the last one in 2013.

    MA: You mentioned your political activism early on. Can you talk about the relationship between your strong normative beliefs and your commitment to empirical research?

    MM: Like everything else, I’m the product of historical processes. Growing up in Lancashire, I always had the belief that we produced goods and the South reaped the profits. You can’t escape the predispositions you have. But the best form of social science is about arguments—different perspectives confronting each other and battling it out, empirically or otherwise. Obviously, when I write a book about wars, I make it clear that I’m perfectly opposed to them, that they demonstrate the irrationality of human beings. But then emerges the question, why are we having these wars when they don’t serve the interests of regular people? In this way I think interesting empirical questions can emerge from one’s values.

    MA: Recently I think we’ve seen a shift away from historical methods in the social sciences. What can history continue to offer to socially minded disciplines?

    MM: Comparative and historical sociology has always been a minority section of the discipline, and the character of the majority has changed greatly. But sociological theory is very much tempted by abstractions. And though there haven’t been that many comparative historical sociologists, they have been very influential. When I entered the discipline, it was quite popular in elite universities in the United States—if you went to Wabash State you might not find any comparative historical sociologists, but if you were in Ivy League or UC campuses you would. In recent years, there’s been a greater interest in micro sociology. To my mind, theres too much of it.

    neil warner: What are some of the advantages and challenges of your interdisciplinary approach—standing in between history and sociology, but also in between ethnographic and quantitative methods?

    MM: In recent years, historians have become much more receptive to sociological and anthropological ideas. There’s also been a substantial increase in scale and scope; there’s a fair amount of what’s called “global history.” That’s definitely a sign of health. Political Science has gone in the other direction, towards a quantitative, rational choice framework. They have far fewer area specialists; it’s quite difficult to find a specialist who knows a lot about South Asia compared to someone who’s comfortable with abstract models. A great dataset of wars since 1816 led to a series of quantitative studies, but the dataset was skewed towards the West and the analysis didn’t extend to earlier history. So overall, there’s an argument to be made that this shift is distorting our views.

    NW: One thing that’s unique to your work is this balance between causal grand narrative and the emphasis on the fundamentally contingent and directionless nature of history. How have you positioned yourself in debates on historical understandings of time?

    MM: My view, which is only half formulated, is that there is a sort of dualism we have to be sensitive to. Dialectic, in the Marxian sense, is—in its own complex way—a bit too deterministic. My dual way of thinking about it is that the four sources of social power each has its own logic of development. There are tendencies there, but they interact with each other in contingent ways, and alternative outcomes are always possible. Of course, in the case of economic power especially, there are significant qualitative shifts. But if we look at capitalist development, there are certain logics involved, like capitalism’s creative destruction, monopolization, and so on. You can find similar tendencies with the development of particular ideologies. But the outcomes involve contingencies.

    NW: The Sources of Social Power was decades in the making—your writing of it spanned the fall of the Soviet Union and a series of financial crises. How did these world events shape your writing process, and the reception of your books over time?

    MM: I never developed a strong theory, equivalent to “capitalism will be replaced by socialism.” The work essentially presents an orienting model, so it has flexibility. My treatment of ideology was I think fairly weak at first, and it’s one that I am still developing. In volume four, I didn’t feel able to make strong predictions about what was going to happen next, and I certainly don’t think I can do so now. I find that a lot of sociological generalizations—like “globalization”—are rather one dimensional, so I’m not particularly attracted to them. I’m always willing to be surprised by the course of history. In this pandemic, for example, I’ve been surprised by the cross-national lack of faith in science. People seem to think that the experience and sentiments of those around them matter more than those of any authorities—magic is more important in our societies than we realized. I’ve been coming to that view in writing about war—that humans are erratically rational, or they’re rational within a framework which itself might not make much sense, and which is full of emotion and ideology as well as instrumental rationality.

    MA: You’ve argued that we should “do away with the concept of society,” that society should be thought of as a “patterned mess.” What does the concept of society mask? And, more generally, how do we reconcile the need to categorize in order to understand with the knowledge that all formal categories are fundamentally incomplete?

    MM: Of course, that statement was provocative. We can’t really avoid the use of the word society, or communities, or nations—it doesn’t make much of a difference. In the contemporary world, the nation state remains important, and it does have boundaries which affect us. We as citizens or residents are subject to the laws of that state. One thing that continues to be striking in terms of political power is that state elites remain pretty free to make decisions on foreign policy but not nearly so much on domestic issues. Of course, there are globalizing tendencies, but today there is far more coherence within the nation state than there has been in most historical societies, where political elites governed with little constraint from the population. In the nineteenth century, large parts of the population were unaware that they were even living in France: Eugene Weber argued that nineteenth-century frenchmen thought they were from “around here” or from “Provence” but not France. The concept of France was pretty meaningless to them.

    MA: One of the aspects that distinguishes your work is precisely your emphasis on states as autonomous agents, rather than a perhaps more widespread historical focus on classes. What do you see as the relationship between the two?

    MM: There has always in some sense been a ruling class. But with the development of states, we also have the emergence of popular classes. I’m quite Marxian in the sense that I subscribe to the view that the extraction of surplus from direct producers is the way that ruling classes can live, build cathedrals, and castles, make war, and so on. Of course, there are cases of peasant revolts led by provincial gentry who are discontented. And peasant revolts tend to have a rather erratic nature, they tend to be defeated because they have ultimate faith in the monarchy—there are some evil counsellors, but theres no questioning of the system as a whole. The emergence of the radical bourgeoisie in the early modern period, and then the emergence of the working class and organized peasantry produced substantial modification in class structures and states. Of course, they didn’t have the power to ultimately produce a new egalitarian society, though there are variations in how equal the outcomes were. But they turned out to have less power than was assumed. And now that some of the conditions which generated large factories and labor unions are declining, theres no immediate prospect for achieving that sort of egalitarian world.

    MA: Building on that, you’ve argued against viewing globalization as a single process, and you’ve also argued that it hasn’t diminished the power of states. Why have states been so resilient, and how has their function changed over time?

    MM: The resilience of states is due to a combination of factors. One of them is the human desire for order rather than disorder, that’s something that states can do, and is one of their main attractions. States can also redistribute; they provide welfare throughout the life cycle for things like public health and education. So states are not likely to wither away. Virtually all the data we have are collected on a national basis, of course the EU is a bit of an exception but it appears to be in a phase of non-development. People conceive of themselves now as having a national identity, though there are rival claims about what that identity entails.

    I think climate change has the potential to change this sort of reasoning. The only way human beings can survive is through a much greater degree of cooperation between states. But states remain the primary actor; we saw it with the pandemic, which was of course global. But the response was communicated through national interest, even when it harmed much of the world—like not supplying enough vaccines. Solving climate change would involve considerably more coordination between states. Whether they’re capable of that is unclear, but if they were to do so it would be possible to imagine a world in which the autonomy of individual states is much weaker.

    MA: Many people view the so-called neoliberal shift of the 1980s and 1990s as an example of markets dominating and in some cases superseding the state. What are your thoughts on that?

    MM: States have been the agents facilitating neoliberal economic policies, they were the ones to deregulate financial markets. So I dont think it makes sense to think of neoliberalization as purely the product of an external force; political forces in many countries decided that the way to more economic growth is through spending cuts and liberalization. Did they do it because of external global pressures? I don’t think so, I think they did it because of the perceived self interest of powerful people within each state. I have a good friend, Leslie Sklair, who argues for the existence of a global capitalist class. And there is some truth to that, when we think of things like Davos, but ultimately I think the interests remain state based.

    MA: Your 2003 book Incoherent Empire forwards an assessment of the instability of the American empire. Much has changed since then, and I think some of the contradictions you highlighted are now far more visible. Where does the American empire go from here?

    MM: America hasn’t won a war of any significance since 1945: Korea was a failure, Vietnam a failure. They could invade Panama and Grenada, yes, and they could destroy Saddam, but they couldn’t impose a client government. In that book I say that the Age of Empires is gone because you can no longer find the native clients to help you rule (or, if you do, it’s an ethnically or religiously divided society in the midst of civil war). The American Empire has not been a direct empire attempting to rule directly as the British or the French did. And obviously the US still wields a considerable amount of global power. But the it cannot stomach large numbers of Americans dead, and various forces around the world know this, and know they can outlast the US in that regard. So it’s not just that the US hasn’t won wars, but that it’s unlikely that it will be able to.

    In Ukraine, US and NATO power has been limited. What the Chinese are trying to do at the moment is recreate the boundaries of imperial China, whether it’s Tibet, Taiwan, the South China Sea, even a bit on the border with India. These are all viewed as legitimately Chinese. And the Russians want to make the same claims to rule where there are Russian speakers. This kind of impulse towards revising border is a tremendous force for creating wars historically. So the US has to accept the rising power of China even as it continues to stand for an increasingly imperfect democracy. We’re back in a way to a so-called Cold War, and again with nuclear weapons.

    MA: Can you tell us about your new book?

    MM: It’s called On Wars, which is a conscious adaptation of Clausewitz’s On War. Where he looked at one particular period of war in Europe, I’m looking at wars throughout human history. There is no known population of wars, because of the volume of unknown ones. But I go from anthropological and archeological findings to the Roman Republic, to Ancient China, the Chinese Empire, Japan, Europe, the US, and colonial wars. These are not individual conflicts, but sequences of wars. I’ve compiled what data I can from the sources, which become quantitative in the modern period.

    In the book I try to understand the causes of wars, and how rational they are according to particular ends. In part, the book serves as a critique of theories rooted in notions of rationality. I believe I show that the vast majority of wars are not rational in either means or ends: calculations of the costs or benefits of wars are rarely made, and when they are, it’s within the context of historical constraints. As for ends, states are often destroyed by war. What we have are the records of a few survivors who portray war as glorious. But if you consider that Europe had about 500 political entities, and Japan had more than seventy states, and the same is true of China and the Mediterranean, then at least half of realism, defensive realism, has very little validity. The vast majority of states that have existed have disappeared, largely due to war. There is no genetic programming that leads humans to make war, but a human nature which entwines reason, emotion, and ideology is likely to make war.

  9. Rekindling Labor?

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    The uptick in organized and unorganized labor militancy registered throughout the pandemic, and in particular in strike and unionization campaigns in recent months, comes at a relative nadir for the US labor movement. The work of Kim Voss, Professor of Sociology at UC Berkeley, brings the current moment into sharper focus against the longer and particular histories of worker organization in the United States—from nineteenth century workers’ organizations to more recent alliances between unions and social movements. 

    Voss’s 1993 book, The Making of American Exceptionalism, argues against theories which attribute the labor movement’s weak and conservative character to factors like the individualist nature of American culture or the structure of the American economy. In doing so, she follows in the tradition of scholars like Werner Sombart, who emphasize the historical contingency of capitalist development. Voss traces the divergence between the American labor movement and its European counterparts to 1886, when powerful employers coordinated with the state to crush the progressive Knights of Labor.

    Her later work focuses primarily on strategies for union revitalization; the 2004 book Rebuilding Labor, co-edited with Ruth Milkman, considers the state of union democracy, conditions of membership recruitment, effectiveness of union leadership, and degree of anti-union sentiment among contemporary workers. Hard Work, published the same year and co-authored with Rick Fantasia, focuses on the emergence of “social movement unionism” in cities like Los Angeles and Las Vegas, arguing that even in a hostile terrain, trade unions which form strong community ties and are able to integrate labor demands with broader social aims may have a hopeful path forward.

    We spoke in November about turning points in the history of the American labor movement and the recent events of “Striketober.”

    An interview with Kim Voss

    Maya adereth: The notion of American Exceptionalism—the idea that US economic and political systems are unique from those of other rich democracies—frames your work on the Knights of Labor. Did this idea ever have resonance, and if so, does it still have any today?

    KIM VOSS: American Exceptionalism has always been a fraught term used in many different ways—politicians and pundits tend to use it to exalt the US political system, while scholars often point out that it’s not altogether that special, and others sometimes use the term to highlight the failings of American democracy. My entry into the debate was specifying which type of exceptionalism we’re talking about. With respect to labor, it’s accurate to say that the American labor movement has been broadly less progressive than comparable movements. Episodically, there have been higher levels of militancy, but this didn’t result in a politically strong and inclusive labor movement. In my book, The Making of American Exceptionalism, I argue that it didn’t have to be this way. Especially if we go back to the last three decades of the nineteenth century, we can see that there were other possibilities for development, and periods in which the American labor movement advanced in an inclusive and progressive direction.

    MA: You demonstrate a similar resistance to stagnant categories in thinking about the labor movement. Eric Hobsbawm famously developed the idea of the labor aristocracy; a layer of organized craft workers who organize along sectional lines. You take a far more flexible view, arguing that local conditions may lead craft workers to take more inclusive or exclusive strategies in different moments. What are the different strategies available to unions, and what might lead them to adopt one over another?

    KV: My instinct of course is to immediately historicize the question. If we look at how social movements, and especially labor movements, mobilized in the late nineteenth century, craft workers (the so-called labor aristocracy) were more able to advance their program simply because they had more resources to build on. But there were crucial moments in which they made common cause with less privileged workers, such as when the Knights of Labor used the language of egalitarian democracy to fight for labor rights and when they mobilized community ties to build solidarity across skill level, nationality, and gender. Part of the reason why this didn’t occur more frequently is because of the organization of powerful employers and the way in which the government responded to moments of labor militancy—the state only intervened episodically in labor struggles, but when it did it was always against broad-based mobilization. So, when the Knights of Labor did successfully organize skilled and less-skilled workers together in strikes against concentrated corporate power, the state either did nothing to constrain employers’ actions or it brutally repressed workers. 

    The lesson that labor leaders and activists draw from this was that it would be impossible to win by organizing a mass movement. This lesson structured the orientation of the majority of labor leaders in the American labor movement for generations; there wasn’t a big upsurge of mobilization for progressive change again until the 1930s. And even after the creation of industrial unions, when the labor movement campaigned for broad universal demands like healthcare and pensions in the 1940s, it was pushed back. The result was the construction of what I and others have called a private welfare state. By using collective bargaining to gain things like medical benefits, employment security, and pensions, trade unions were able for a while to offer members a private alternative to the public system of social provision. But in the long run, this proved to be a losing strategy, because it divided organized from unorganized and privileged from unprivileged workers.

    MA: There are a number of factors which come up frequently in explaining this push back, two of which you have written about extensively. The first is immigration, and in particular the widespread hostility towards immigrants from China, Japan, and Korea, that’s pervasive in the AFL literature. The language they used is familiar to a contemporary ear: immigrants flooding the market with cheap labor and undermining the bargaining power of organized workers. What sort of relationship has the American labor movement historically had to immigration, and when have these sorts of cleavages been overcome?

    KV: My current work, which I’m doing with Irene Bloemraad, is a theoretically informed, comparative examination of immigrants and social movements, although not just from a labor perspective. The key contradiction informing this work is between the deep and persistent hostility towards immigration that we see across American working class organizations, and the narrative of the “nation of immigrants” which is periodically conjured by government representatives. In the early AFL documents that you allude to, anti-immigrant sentiments go hand in hand with the organization’s craft orientation: the same reasoning which drives leaders like Samuel Gompers to advance sectional interests of skilled workers paints low-wage, nonunionized immigrant workers as a threat to tight labor markets. An interesting detail in the work of the historian Donna Gabaccia is that the term, “nation of immigrants,” was first used in the Civil War decades to justify the exclusion of immigrants, typically referring to “undesirable” workers from China and southern Europe and often using the term in a nativist context; it was only used as a phrase to celebrate inclusiveness much later, during the reform years of the late 1960s. Though Americans have been conceptualizing themselves as a nation of immigrants for centuries, this concept has been politicized in different ways at different moments.

    Though the American labor movement was overwhelmingly anti-immigrant, there were notable moments of inclusiveness on the part of unions. The Knights, of course, had their own opposition to Chinese migrant labor, but still organized immigrant workers. And AFL affiliates like the International Ladies’ Garment Workers Union were at the forefront of organizing low-wage immigrant workers in the early twentieth century and innovating strategies to resist deportation in the 1970s. It’s useful to remember that the AFL-CIO has always had little control over its national unions, and the national unions bear little direct influence on the locals, so we do have all of these internal struggles. Why were the Garment Workers so far to the left on deportations and other issues in the 1970s? Part of it is that their leadership had a commitment to labor solidarity, but the other part was that so long as the government was conducting raids on the garment industry, they couldn’t organize without defending the rights of undocumented immigrant workers. In the early twentieth century, leaders of ILGWU faced resistance from the immigrant, low-wage, and largely female rank-and-file textile workers, and the union had to adapt to an industrial strategy. 

    MA: The other element is the immense power of US employers. Historically, American employers have not only been well organized, but have had direct influence on the interventions of the state. Can you talk about the role of employers in shaping the organizational strategies available to workers?

    KV: American employers have always been better resourced than employers in many other rich democracies, and they have also usually been able to count on the state as a partner. If we compare the American labor movement to the French or British one in the last decades of the nineteenth century, we see that in France and Britain, the state did occasionally intervene directly or behind the scenes to demand employer concessions; when the American state did intermittently intervene, it was unfailingly on the side of employers until the New Deal era. 

    It’s important to remember that the US state in the nineteenth century was a very different kind of state. Stephen Skowronek characterizes it as a system of “courts and parties,” meaning that it didn’t have many of the bureaucratic and infrastructural features of many European governments. Nevertheless, when it sent the military to attack strikers, as it did in 1886, it played a decisive role in shaping moments of upsurge. 

    In the twentieth century, after the organization of the CIO and the establishment of the legal right to form a union, employers’ strategies shifted. They first acquiesced to a new institutionalized process for recognizing unions—and then learned to use those rules to their advantage. Today, the union certification process for private sector firms in the US is an adversarial process of majority recognition; the only way workers can join a union is if they can convince a majority of their coworkers to vote for a union, usually in an election overseen by the government. 

    Employers have a say in who is and is not eligible to vote, and they are legally allowed to mount fierce anti-union campaigns in which they threaten and intimidate workers, both collectively and in required one-on-one meetings. For these campaigns, employers can—and often do—turn to a sophisticated industry worth hundreds of millions of dollars per year devoted to helping employers resist organizing drives. If even all these employer advantages are not enough to prevent union recognition, bosses have formal procedures for deunionization at their disposal, procedures unheard of in other rich democracies. Should workers persist in the face of these many obstacles, employers have the legal power to permanently replace them if they go on strike. These advantages most definitely shape the organizational strategies available to workers, requiring unions to design comprehensive and innovative campaigns, even as they grapple with the kind of structural changes in the economy that are destabilizing labor movements across the globe.

    MA: I wanted to ask about innovation in labor strategy, and how organizing tactics reflect broader relationships between workers and employers. The Services Employees International Union (SEIU), which took off in the 1990s, for example, has often been criticized for relying on public relations and top-down negotiating strategies. What does the SEIU tell us about recent American labor history?

    KV: There are a lot of critiques about SEIU out there, in part because it’s one of the few U.S. unions in recent years that has been aggressively trying new ways to build the labor movement.  Its rise comes down to a couple of different factors: one is that it recruited activists from other movements, such as the Civil Rights and the women’s movements in the 1970s, and campus activism and identity movements in the 1980s and 1990s. These activists, along with others in the union, interpreted labor’s crisis as a mandate to transform union goals and tactics. Another factor is that SEIU spanned the public and private sectors, so they could leverage resources from one to strengthen organizing in the other. SEIU used its resources to launch audacious and innovative campaigns, like the Justice for Janitors campaigns. The janitorial industry had once been heavily organized  but by the 1980s, unionization had been completely decimated by subcontracting. At a time when other unions had given up trying to organize such industries, SEIU figured out a way by designing a corporate campaign and mobilizing a largely immigrant workforce. Because immigrant workers played a big role in the successful Justice for Janitors campaigns, other unions changed the way they related to immigrant workers—there was even a period when unions across the AFL-CIO concluded that immigrant workers were the key to successful organizing. 

    Another SEIU campaign that yielded significant success is the Fight for $15 movement, an ongoing effort that has led to a higher minimum wage in many US communities and states and an effort that continues to spark activism in many low-wage workplaces.

    Does SEIU always get it right? No. Some critiques that it has relied too heavily on top-down negotiating strategies in some of its campaigns are justified. Has SEIU sometimes neglected bottom-up strategies, even turning against the rank and file? Yes. However, we have to understand SEIU’s inadequacies not simply by turning to the usual suspects, such as flawed leaders or deficient politics, but instead we must consider the ways that capitalism itself has changed. With financialization of the economy and atomization of workplaces, it has become increasingly difficult to generate the kind of employer response to workplace actions that was key in the 1930s. As Pablo Gaston and I have argued, financialization and other economic trends have undermined the leverage that workplace actions alone can provide. As a result, organizing campaigns can succeed only when they synthesize and combine top-down and bottom-up approaches, and sometimes not even then.

    MA: How have the transition to service sector work, automation of job oversight, and financialization changed the strategies labor unions should pursue? Amazon is on everyone’s minds, and previously it was Walmart.

    KV: The labor movement hasn’t come up with a strategy for organizing Walmart, and the best analysis I’ve seen is in the book Working for Respect by Adam Reich and Peter Bearman.  They point to the challenges presented by Walmart’s huge scale, as well as to what they dub, “walmartism,” a managerial strategy of control that results in an autocratic workplace where it is very difficult to build and sustain relationships among coworkers.  

    How do social movements come up with new strategies for social change? One thing I’m sure about is that you can’t organize Walmart or Amazon one store or warehouse at a time. The lesson I draw from the scholarship on labor movement revitalization is that it will take a comprehensive strategy, one that combines an analysis of Walmart’s and Amazon’s corporate vulnerabilities with an on-the-ground strategy of small successes to show workers that it’s worth risking their livelihood for a union. Currently, with respect to Walmart and Amazon, we are where the activists that innovated the Justice for Janitors campaign were in the late 1980s. No union or activist that I know of has yet put together the bottom-up and top-down pieces, but I have to believe it’s possible.

    MA: We’ve just seen this uptick in worker militancy and strike action in John Deere, Kellogg, Kaiser Permanente, and other workplaces across the country. How can we understand this moment, and what does it indicate for US labor movements in the coming years?

    KV: Clearly one of the things that is playing out here is the pandemic, and the rhetoric about essential workers and their sacrifices. Once employers saw improvements in their economic situations, these sacrifices on the part of workers were neither acknowledged nor compensated. Workers understandably feel betrayed and angry, which are key factors driving the strikes. In addition, workers sense that they are in a stronger strategic position now, and thus, many believe that strikes are winnable. 

    Where do we go from here? How much can we expect to see a larger wave? The more these actions succeed, the more of them we’re going to see. While the numbers we’re seeing now are impressive, they don’t come anywhere near earlier strike waves.  Nor have they resulted in new unions or growth in existing unions, as the strike waves of the 1930s did. Of course, we have to celebrate successes. But it will take a heck of a lot more success—and organizing—to build a movement. 

  10. Long Crises

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    With the victory of Eric Adams in the Democratic mayoral primary, New York City stands at a crossroads. How will the city negotiate the changes brought about by Covid-19? What will be the lasting legacy of Black Lives Matter? How will the metropolis—and other American cities—evolve in the years to come?

    As New Yorkers grapple with an uncertain future, the fiscal crisis of the 1970s and its aftermath are often invoked by the press and politicians. Today, “New York in the 1970s” is shorthand for a city facing poverty and crime, running out of money, and suddenly confronting the end of one social order and the rocky emergence of another.

    Given these dynamics at play, the publication of Benjamin Holtzman’s The Long Crisis: New York City and the Path to Neoliberalism could not have come at a more opportune time. The book tells the story of New York City in the years that preceded and then followed the fiscal crisis and near-bankruptcy of the city in the 1970s. Holtzman reveals how—with the absence of effective government responses—ordinary political wisdom changed to favor private, market-based solutions, whereas earlier generations might have looked to the city government or collective institutions such as unions. He shows that New York City’s history during this time went beyond austerity, constituting a whole new approach to government. This shift to the right was not just a matter of ideology, nor was it driven entirely by elite actors. Rather, it was built by many different political participants and communities on the ground, ranging from park volunteers, to business groups, to neighborhood patrols and beyond. Raising key questions about the city’s history, The Long Crisis is a critical work for understanding the origins of contemporary New York City—and thinking about where we go from here.

    —Kim Phillips-Fein

    An interview with Benjamin Holtzman

    Kim Phillips-Fein: This is a book about New York City in the late 1970s, 80s, and 90s. Why did you want to write about New York City in this era?

    Benjamin Holtzman: The project came out of my dissertation. When I initially got to graduate school, I was pretty sure that I didn’t want to write about a crowded field like New York City, and I was also pretty sure that I didn’t want to write about a period I had been alive during, which meant not writing about the 1980s. But when it came time to really get into the details of a dissertation project, I found myself returning on a personal level to the transformation of New York City that I’d seen when I was young. I kind of remember the city of the 1980s, the transformations that really became much more visible over the 1990s, and I found myself thinking through how those changes came to be. From an intellectual standpoint, many of the books written about New York City during this particular period were by Marxist geographers, David Harvey most prominent among them. I admire and have gained a lot from that work, but something in those stories—which tell a much more structural history of the period—made me curious about the reactions of people on the ground.

    Many of the works that influenced me also explored the idea of the urban crisis. But there were fewer historians writing about the aftermath, which for a lot of cities was a period of economic “rejuvenation” in the late-twentieth century. So I landed at this project thinking about the political aspects of this transformation.

    KPF: Very frequently, if you talk to people about New York City in the late-twentieth century, there is a notion that the city is so much better off now than it was then. Certainly you see this in the recent mayoral race—nobody wants to go back to the bad old days. But your book is called The Long Crisis. How do you contend with the success narrative that’s been written of the late-twentieth century in New York City?

    BH: I’m trying to do two things with the title. One is drawing attention to the period of great economic trouble in New York City’s history—the transformative events of the fiscal crisis in 1975. But also I want us to think of the crisis as something that started years earlier, with ramifications that continue long afterwards.

    The starting point for the book is really in the late 1960s, when New York City was facing various sorts of economic troubles. This came to a head when the effects of urbanization, capital flight, federal disinvestment from urban areas, and a national recession constrained municipal resources in New York City. How did people respond to those dynamics in the years prior to the fiscal crisis? The consequences of these changes linger past the 1970s. Even within this latter period of economic “rejuvenation” after the 1975 crisis, many issues remain.

    KPF: Your book has a broader view that actually captures both ends of the crisis point of the mid-1970s, showing the deep roots of the fiscal crisis in things that were happening well before, and then also showing the dynamics that it helps to galvanize long afterward. You argue that while the power and resources of local government remained enormous in the early 2000s, they were increasingly deployed to facilitate the role of the private sector and the market in urban life. I want to read one of my favorite passages from the introduction.

    Unlike decades before, a New Yorker on a Sunday stroll at the turn of the century may very well have found herself walking out of a condominium that was formerly a rent-regulated apartment, accessing the subway through a privately-owned “public” atrium, walking down a street policed by private security guards and managed by local businesses, and playing basketball in a privately-run “public” park.

    The passage illustrates the theme of private sector-driven solutions to what we might normally think of as being in the realm of the state or public resources. You use the term “popular marketization” to describe the late-twentieth century rather than more familiar terms such as neoliberalism or austerity. Can you describe what you mean by “popular marketization”?

    BH: Marketization is a term I use to simplify the multiple processes that reflect the growth of the private sector and the market in city life during this period. It’s not just something like privatization—the move from a state-controlled system to one controlled by the private sector. There are certainly lots of examples of privatization in the book. There are also examples of deregulation and the growth of market-based systems. But I was trying to uncover a broader range of processes by using a term like “marketization.”

    The “popular” part is meant to refer to the ways that, in the face of constrained municipal resources and services, people throughout the city looked to different kinds of solutions to retain cherished aspects of city life. This could be about their local neighborhood park or a concern about the growth of crime. Some of these were experiments—like launching a community volunteer project to improve a local park. But they weren’t condemning the government or adopting an ideological orientation that favored market solutions—they were just looking for ways to solve problems in their neighborhoods in a situation of constrained municipal resources. And these alternative solutions expanded over time in ways that ultimately transformed the city by increasing the role of the private sector and the market across city life.

    KPF: What are some examples of how people sought to respond? In a way, you show that people continue to believe in and expect that the city should provide parks, libraries, and safe and reasonably clean streets. It was almost like holding onto the hope of a certain kind of common civic life, but meeting increasing frustration about the ability of the government to deliver that.

    BH: Parks are certainly an example. At the municipal government level, there’s a decline in the conditions of parks not only in lower-income neighborhoods, but throughout the city. What I found was that across the city, people started to come together to launch neighborhood fundraising initiatives to pay for improvements, seedings, and cleanups, along with volunteering in their local park.

    They begin over time to receive support for these efforts from park advocates, and to some extent, from the city. And again, they’re not undertaking these efforts because they really believe that the city shouldn’t be responsible for parks. They’re trying to respond to a problem.

    I also look at the example of homesteading. There’s an extraordinary problem of building abandonment in the city during this period: thousands of units that landlords essentially walk away from. In response, lower-income and especially Latinx and African American residents in the areas where abandonment is at its worst—the South Bronx, Harlem, Central Brooklyn, and the Lower East Side—begin to reclaim these buildings. The people involved in these reclamations never denounce government support per se, but they do frame their responses as being led from outside of government.

    The residents are the ones serving their neighborhoods. But I also chart how, over time, the reclamations and homesteading opened these communities to political officials being able to restrict government resources, and simultaneously orient this stock of abandoned buildings towards the private market. These solutions by city officials looked quite different than what the homesteaders wanted.

    KPF: One thing that’s really remarkable about the book is the range of different actors and characters. There are the Renegades: the homesteading group, a group of low-income people of color who are reclaiming buildings in their own neighborhoods. And then there are park volunteers and the friends of the parks groups. But on the other hand, you write about Madison Square Park business owners who get together in a very self-conscious way to reclaim that park. The processes they are engaged in are similar, but they’re not in dialogue with these other groups. They’re not just concerned about making the park a more livable space, but the impact of the park on their businesses and the value of their properties. A similar dynamic occurs in the chapter on private policing and private guards: on the one hand, neighborhood and local patrols, on the other, the corporate security dimension.

    BH: I think that it’s a really important clarification. The point of the book is not to argue that neoliberalism and marketization are simply grassroots processes, but it’s rather to shine a light on the important role that people on the ground in their communities had as part of these processes. Powerful interests and officials are of course crucial as well, and I spend a lot of the book focusing on them. I’m trying to show how these different—and in some cases opposing—interests and groups of people come together in ways that facilitate this transition towards relying more on private citizens, the private sector, and the market.

    In the case of the parks, community-led volunteer responses promote the idea that the city can no longer maintain these spaces. That helps open the door for more powerful actors.

    What follows is the strange coming together of Richard Gilder, a prominent conservative philanthropist, and George Soros, who create private elite donor support around improving conditions in Central Park. Grassroots efforts meet elite-led efforts that proliferate a different kind of image for how parks are going to be saved. They turn to private associations that tend to be overwhelmingly influenced by residents and businesses, not just to play a role in improving these parks, but to actually manage them. The result is that even though the city has a role, private organizations are taking the lead.

    KPF: The founder of the Guardian Angels, Curtis Sliwa, is back in the news in New York City as a candidate in the Republican primary for mayor. The Guardian Angels is one of the most high profile forms of citizen patrol, which comes from this sense that, well, the cops aren’t doing it anymore, and we have to keep ourselves safe, so we’re going to the subways on our own. Some people think of the Guardian Angels as the sole instance of this phenomenon, but you show a different story.

    BH: The Guardian Angels came onto the scene in the 1980s and were late to the game. The growth of private security that I look at in the book begins with greater concerns about crime in the 1960s. It was similar to volunteer initiatives around parks. People spanning various neighborhoods and boroughs gathered to form resident crime patrols in areas throughout the city. Alongside this turn to privatized policing, we begin to see more middle- and upper-income neighborhoods turn to private guards as well. There was an explosive growth of private security in the 1960s and 1970s. Before that point, private security had been limited to private land, patrolling businesses, the grounds of the factory, and so on. It was far less common to see private security in public spaces. That transformation takes place in the 1970s, when elite business initiatives began to come together to create private solutions for crime in public spaces.

    For example, the Morningside Area Alliance in Morningside Heights brought together private security forces that were operating on campuses and in hospitals onto public streets. A similar kind of initiative took place among real estate owners in Midtown during this period. All these efforts were supported by an understanding that crime is not something that the city alone can address. Today, we’re constantly surrounded by private security in public spaces. That was not true before the 1980s.

    KPF: Much of the story you tell is focused on either grassroots neighborhood actors or local business actors. But you also have a chapter on tax incentives which, by contrast, focuses much more on City Hall and how public officials, including Ed Koch and Abraham Beame, changed the role of business in the city. These dynamics got a great deal of attention in New York a couple of years ago in the debate about bringing Amazon to Queens, and there was widespread public dissatisfaction with the subsidy package that Amazon was receiving. This in turn resulted in Amazon saying, “We don’t want to be in a place that doesn’t want us.” Your chapter shows a much deeper history about the turn towards tax incentives as a question of public policy in the late 1960s and early 1970s.

    Why would a city that was coming under increased fiscal pressure, or running out of the money that it needed to fund services, turn towards these types of incentive programs? How do they change over the time period? I’m thinking especially of 421A and J51.1

    BH: I look at a couple of these tax exemptions, abatement programs, and tax incentive programs, which really proliferate during this period. Although the ones that I look at are oriented more around housing, they are part of an economic development strategy. The impetus for creating new solutions is, of course, coming out of the economic crisis. Officials feel that they don’t have the resources to spend city money to spur economic development, so the only thing that they have to offer is giving up the revenue associated with taxes, at least in the short term. 421A changes over time, but in short, it provides an enormous benefit for developing housing for middle- and especially upper-income residents.

    J51, which was more about converting existing buildings into middle- and upper-income housing, fueled much of the conversion of single-room occupancy hotels, which housed a lot of the city’s houseless and poor populations in the Upper West Side and Brooklyn Heights. These incentives began to be used in all sorts of other ways during this period, playing a role in the conversion of SoHo lofts and in some cases turning office buildings into middle- and upper-income housing. This moment is really when the city embraces the use of these kinds of tax incentives, which have now become widespread. They have also proliferated various other tax incentive strategies to promote housing and business—these tax giveaways at the city level are a principal urban development strategy today.

    The original aim of a 421A was to create moderate-income housing, but as soon as it was implemented and put to widespread use under John Lindsay, it created affluent housing. City officials were quick to say, “Oh, well, that’s good too, just forget about the more moderate-income aims.” J51 aimed to make improvements on less expensive forms of housing to make them more livable for the moderate-income population. Before, the city had tax abatement programs around urban renewal programs, like the Mitchell-Lama housing program, which were much more oriented towards low, moderate, and middle-income populations. We see this complete change to tax incentives being used to subsidize upper-income housing. Incentives for luxury housing are used to attract people from outside the city, instead of supporting those who are in desperate need of housing within the city.

    KPF: Your book joins a growing literature on liberalism in the twentieth century—I’m thinking of Amy Offner’s Sorting Out the Mixed Economy, Lily Geismer’s Don’t Blame Us, and Paul Sabin’s Public Citizens, all of which document how liberalism changed during this time. Do you see your book as being more in dialogue with that literature, or with books on other cities undergoing a kind of post-industrial shift, like Gabe Winant’s recent work on Pittsburgh?

    BH: I definitely see the book as building on the work you suggested. I was thinking about a transformation that we see in the Democratic Party and liberalism in terms of aggressively seeking out policy solutions that engage the private sector or market. During this era, the liberalism that included bigger government solutions, if not quite over, was at least severely battered in many ways.

    You can see this process take place over the period of three mayoral administrations. John Lindsay who became mayor in 1966 was a Republican, but very much a liberal. By his second term, he certainly hadn’t lost his faith in government solutions. But as the city faced greater economic turmoil in the late 1960s and early 1970s, he became far more open and actually reversed course on a number of issues. By the late 1960s, he became much more receptive to things like citizen involvement in parks and volunteerism, taking on rent controls and rent regulations—things that reduced the “burden” on city government. He became much more willing to encourage private sector and market-based solutions to address New York’s problems.

    This trend really grew under Abraham Beame and was embraced by Ed Koch in the late 1970s and 1980s. Koch believed the city needed to turn towards the private sector and market in order to function at all, and he denounced the role of government and a generous welfare state. He ushered in greater municipal support for a variety of initiatives that looked to private sources. But he was only able to do that because these initiatives had been in the works for over a decade.

    KPF: We’re obviously at the end of a particular moment of crisis, coinciding with the mayoral election in New York City. Where do you see the vision that you chart in this book today? Do you think it is possible to recreate a vision of the city that is less dependent on private actors, more encompassing of both city government and other kinds of collective institutions, and less easily turned towards the interests of people who have more private resources to devote?

    BH: We’re still very much in this moment. Business improvement districts, park conservancies, private security—all of these things have proliferated and remain a fundamental part of city life. The rise of charter schools and the undue influence of the PTA on public schools remain powerful examples.

    However, I think even those who are suspicious of the trajectory of the Democratic Party have been surprised by what we’ve seen at the federal level under the Biden administration. In terms of reviving state solutions, orienting around social welfare, and using the state to alleviate rather than exacerbate inequities—these efforts, however limited, have been notable. It’s hard to say where we’re headed in New York City, particularly in this mayoral election where Eric Adams, the leading candidate, is not progressive.

    It is interesting to see that in the midst of what remains a strong, vibrant, progressive sentiment within the city, we have a very moderate candidate leading the pack. I think this speaks to how in periods of crisis, people often look for security, and that has benefited the moderate candidates in this campaign. This is an important lesson of the book. We need to look at how people are responding on the ground—I really believe people are smart and making rational decisions, and we need to understand what they turn to when they’re not presented with what they see as viable alternatives. Those less compelled by a vision of city life that enhances the power of the private sector and market need to work alongside people, showing that there are different solutions out there. That work is certainly being done, especially at the grassroots level across the city, and we would do well to support it.