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Agreement and Disagreement

Tyler Cowen explains:

If I had to explain, in one sentence, the reason I am not on the political left, I would cite the enormous long-run benefits of economic growth. Of course it still can be argued that various left-wing policies, properly understood, will contribute to long-term growth. But in my view, if you are not supporting growth-maximizing economic policies, you better had a pretty good reason in your pocket.
Well, I agree that if you are not supporting growth-maximizing economic policies, you had better have a pretty good reason in your pocket. I am, therefore, in an important sense not "on the political left" in any especially strong sense. On the other hand, I don't live in the abstract world of political theory where "the political left" denotes an especially left-wing point of view, I live in the United States of America in the early 21st century and see no reason to believe that the policy program of the Republican Party is more conducive to growth than that of the Democratic Party. On the whole, I would argue that the reverse is true. Most prominently, though, there are an awful lot of pro-growth reforms (especially with regard to the tax code) that neither party supports in practice, both organizations being essentially brokers for a variety of interest groups none of which are especially interest in doing the heavy lifting that would be involved in ironing out the wrinkles there.

But if the time ever comes when we get the straight up-and-down choice between more equality and more growth that one finds in a lot of abstract political philosophy discussions, I'd be pretty darn sympathetic to the forces of growth.

August 20, 2004 | Permalink

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Comments

"But if the time ever comes when we get the straight up-and-down choice between more equality and more growth that one finds in a lot of abstract political philosophy discussions, I'd be pretty darn sympathetic to the forces of growth."

Pretty easy to say that when you've got an inheritance coming your way.

Posted by: Petey | Aug 20, 2004 12:57:09 PM

Wait, Cowen says:

Of course it still can be argued that various left-wing policies, properly understood, will contribute to long-term growth. But in my view, if you are not supporting growth-maximizing economic policies, you better had a pretty good reason in your pocket.

So, wait:

Cohen opposes left-wing policies AND
Adopting various left-wing policies, properly understood, arguably will contribute to long-term growth AND
If you aren't supporting growth-maximizing policies, you need a good reason, SO
What is Cohen's reason, again?

On to Matt:

But if the time ever comes when we get the straight up-and-down choice between more equality and more growth that one finds in a lot of abstract political philosophy discussions, I'd be pretty darn sympathetic to the forces of growth.

Which is dumb. Aggregate economic growth is growth in the measure of a convenient proxy for aggregate utility. Inequity is a source of demonstrable disutility which is not captured by the use of aggregate economic growth as a proxy for disutility.

Slavish adherence to maximizing "economic growth" rather than "utility growth" for which economic growth is a proxy with recognized limitations shows a very perverse set of priorities, and is a perfect example of why "the love of money is the root of all (kinds of) evil".

Posted by: cmdicely | Aug 20, 2004 1:11:11 PM

Um, here's a pretty good reason in my pocket: why focus on maximizing growth? Why not make sustainable growth the guiding principle?

Posted by: chiggins | Aug 20, 2004 1:17:10 PM

Um, here's a pretty good reason in my pocket: why focus on maximizing growth? Why not make sustainable growth the guiding principle?

Arguably, "sustainable growth" is maximizing growth -- just maximizing it in the long-term rather than the short-term.

Posted by: cmdicely | Aug 20, 2004 1:17:59 PM


Well, I agree that if you are not supporting growth-maximizing economic policies, you had better have a pretty good reason in your pocket.


How about being human. As in human rights, caring for other humans, democracy, and a whole slew of essentials of our current society that are not congruent with "growth-maximizing economic policies".

The statement is pure drivel. Even the most right wing fool wants policies that are not in line with "growth-maximizing economic policies".

Like spending on rebuilding Iraq.

But then the cop out is already in the wording. Policies that are not "growth-maximizing" will not be economic policies.

But if that is what it is it makes it even more meaningless.

Posted by: philistine | Aug 20, 2004 1:18:01 PM

Mr. Cowen's has one of the most foolish and blinkered reasons for not being a lefty I've ever heard. Bravo.

What, no discussion of how this magical 'growth' thing should be the be all, end all arbiter of a political system? How surprising. And of course the average lefty is rabidly anti-'growth.' Right.

Amazing sophistpry.

Posted by: Timothy Klein | Aug 20, 2004 1:20:48 PM

What are we going to "grow" into in this country?

I don't understand the growth fetish. It doesn't make sense to me from a market-capitalist perspective much less a socialist one.

Posted by: absynthe | Aug 20, 2004 1:28:28 PM

Is there any reason to think that the right's policies are more pro growth than the left's? What exactly would be the measure of such. BTW, I just checked my pocket and what I found there was no reason to be a righty unless it was late, I was drunk, and Ann Coulter was the only other person in the bar.

Posted by: LowLife | Aug 20, 2004 1:31:56 PM

Pretty much what you'd expect a Dalton/Harvard boy to think. Look, Matt, growth without equality means an increase in inequality of wealth. Inequality of wealth causes many problems: it creates inequality of power, such that social and physical aspects of the society are ordered to provide comfort and pleasure for the rich to the detriment of others; it leads to a society of envy and crass materialism; it creates a permanent servant class, with a mentality that as an educated liberal person you really don't want to foster; and, surprisingly enough, it interferes with the use of market forces to regulate the delivery of essential goods and services. (We'd all be happy to have health care regulated by the market if those at the bottom wouldn't have to go without.)
More inequality, of course, is what Bush Republicans want. They'd like the whole country to be like Texas. There's nothing like cheap labor to make a well-off person feel like a king.

Posted by: jr | Aug 20, 2004 1:32:23 PM

If I had to explain, in one sentence, the reason I am not on the political left, I would cite the enormous long-run benefits of economic growth.

Enormous benefits - to whom? I agree with those who said that the difference between right and left is not "pro-growth" vs. "anti-growth", but how these benefits are distributed.

Posted by: abb1 | Aug 20, 2004 1:43:56 PM

But, you come down on the growth side of the growth/equality tradeoff (pretending, for a moment, that there is necessarily one) is only because you believe that roughly, a rising tide lifts all (or most) boats even if it lifts some a lot more.

per capita GDP is not a value-neutral measurement of welfare, we just tend to pretend it is.

Posted by: Atrios | Aug 20, 2004 1:52:36 PM

Other idiots in this comment thread nonewithstanding, I concur with Matt. The single thing that will do the most to make this world a better place is for us to maintain a good, sustained global growth rate. This is why free trade is a biggy.

Posted by: Glenn | Aug 20, 2004 1:52:44 PM

Any discussion on this issue must distinguish between quality of life and standard of living. Economics deals with the latter and it seems self-evident that free markets and capitalism produce more wealth and raise the standard of living of everyone more effectively than any other economic system. Compare South Korea to North Korea, East Germany to West Germany, or how the poorest in this country lived 40 years ago to how they live today. I think this is the basic premise of Cowen's argument and why Matt, perhaps, agrees...Finally, there is no need to demean Matt by mentioning his schooling or putative inheritance. Just deal with the merits of the argument please.

Posted by: jk | Aug 20, 2004 1:56:27 PM

Hey quit picking on Texas. Mississippi is worse, pick on Mississippi. And other states, like....Mississippi is a lot worse than Texas.

And quit picking on Matt. His class has nothing to do with his DLC positions on economic matters.

Anyway, I like it. "Growth-maximizing economic policies" means, for example, allowing a lot of inflation if it is associated with high GDP. Inflation is quite good for the middle three quintiles, most of them have their major assets in their houses, and wages usually outpace inflation in essentials. Inflation on the other hand, is quite bad for equities and bonds. Fact is, middle class and poor gained relative ground in the 60s and 70s, and lost it back in the following two decades, in part because of tight monetary policy.

By committing to maximizing GDP, MY and Cowen have committed to loose monetary policy.

Posted by: bob mcmanus | Aug 20, 2004 2:01:10 PM

"Growth at any price is the philosophy of the cancer cell."

That aside, 20th century history shows Democratic administrations almost universally better at job creation and growth than Republican ones. Democratic policies tend to favor growth that benefits a broad population while Republican policies have tended to favor the very rich.

Greater economic growth has resulted when prosperity is more widely spread around.

If the middle class doesn't have money, it can't buy stuff.

Before wholesale condemnation of generic "leftist" policies, take a quick review of the 1945 to 1970 period in American, a period that was arguably more "leftist" economically than any other. How do you like the growth during that period?

Posted by: Al Peck | Aug 20, 2004 2:01:48 PM

Well, we need both a little equality and a little growth. It's not an all-or-nothing proposition. Some of the rhetoric here is getting pretty out of hand.

Posted by: JP | Aug 20, 2004 2:34:00 PM

Except that, um, GDP does not actually measure welfare.

More old people with cancer == greater GDP!!!

Posted by: praktike | Aug 20, 2004 2:36:21 PM

Even if we agree on the assumption that economic equality is opposed to economic growth (a big step indeed) there is surely some tradeoff in which a minor gain in economic growth can be achieved by a large increase in economic inequality, which doesn't seem like very good policy. To choose sides in an apparent opposition between abstract concepts doesn't explains much about your concrete political choices.

Posted by: Carlos | Aug 20, 2004 2:39:47 PM

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"Growth at any price is the philosophy of the cancer cell."

That aside, 20th century history shows Democratic administrations almost universally better at job creation and growth than Republican ones.

Ergo, the Democratic party is a cancer? Either growth is bad, in which case the Democratic party's allegedly superior success at promoting it is a thing to be deplored, or growth is good, in which case you've essentially conceded Matthew's point. You can't have it both ways at once.
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Posted by: Abiola Lapite | Aug 20, 2004 2:41:30 PM

Proving once again that it is a great misnomer to talk about a "left" in the United States. To be "left" here means to favor free enterprise and economic growth with a reasonable level of safeguards and controls, plus a modest social safety net for those who are tossed out by the system. Anywhere else, this is a very certrist, Tory-like position.

In Europe, there have traditionally been true left-wing parties that call themselves socialist and actually support nationalization of industries and other statist-type policies. Nobody, repeat, nobody anywhere near the political mainstream in the U.S. is advocating nationalization of industry (with the possible exception of the health insurance industry). The only real "leftists" in the U.S. are publishing magazines with tiny circulations and holding forth on a handful of low-power radio stations. There is no "left" to speak of in this country.

Posted by: wvmcl | Aug 20, 2004 2:44:24 PM

If I had to explain, in one sentence, the reason I am not on the political left, I would cite the enormous long-run benefits of economic growth.

That's an excellent reason not to be a socialist, but it's utterly irrelevant to mainstream US politics. I mean utterly.

Posted by: Kimmitt | Aug 20, 2004 2:46:03 PM

This is a false choice. It is conservatives that say inequality is necessary to produce growth. The political left in America thinks labor unions and education, good government policy and a society not wracked by fracture and riots, produces growth. Stewarding the environment for long term growth is better than exploiting it for short term. Including women and minorities in the labor pool increases growth.

The entire edifice of conservative "growth policy" is predicated on exploitation/flexploitation and inequality. It is not the only way, it is not the best way.

Posted by: David Meyer | Aug 20, 2004 2:47:11 PM

"On the whole, I would argue that the reverse is true."

Don't have to argue. Just look at history. Facts are nasty that way.

Posted by: MattB | Aug 20, 2004 2:48:16 PM

But if the time ever comes when we get the straight up-and-down choice between more equality and more growth that one finds in a lot of abstract political philosophy discussions, I'd be pretty darn sympathetic to the forces of growth.

LOL! way to take a stand, Matt! inspired by your example I'll go out on a limb and say that if it ever comes down to a choice between eating potato chips and owning furniture I guess I'll opt for furniture...

okay, seriously. Tyler's position is untenable in real life, and as cmdicely points out it's not even consistent. in real life maximizing growth (for any simple definition of "growth") is a mathematically guaranteed loser over the long haul, for reasons that apply to complex systems in general. why is it that economists, who you would think would be deeply interested in systems theory and cybernetics, always seem to ignore its basic principles?

complex systems collapse when they fall into maximization well, period. there are no known exceptions. mathematicians call it a catastrophe (in the technical sense) or an asymptote. doctors (and Al Peck) call it cancer. mechanics call it a blown engine. in real life there is no such thing as an engine which cannot be blown.

Posted by: radish | Aug 20, 2004 2:48:50 PM

absynthe: "What are we going to "grow" into in this country?"

Well, you know, all them randy young'uns are makin' babies. Gotta feed and clothe all those new mouths (and send them to soccer lessons, and band camp...)

Simple math: if pop.growth rate exceeds GDP growth rate, average income drops.

Posted by: next big thing | Aug 20, 2004 2:50:29 PM

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