After Neoliberalism

For the past 40 years, the United States and other advanced economies have been pursuing a free-market agenda of low taxes, deregulation, and cuts to social programs. There can no longer be any doubt that this approach has failed spectacularly; the only question is what will – and should – come next.

The neoliberal experiment – lower taxes on the rich, deregulation of labor and product markets, financialization, and globalization – has been a spectacular failure. Growth is lower than it was in the quarter-century after World War II, and most of it has accrued to the very top of the income scale. After decades of stagnant or even falling incomes for those below them, neoliberalism must be pronounced dead and buried.
Vying to succeed it are at least three major political alternatives:
  1. far-right nationalism,
  2. center-left reformism, and the
  3. progressive left (with the center-right representing the neoliberal failure).

And yet, with the exception of the progressive left, these alternatives remain beholden to some form of the ideology that has (or should have) expired.

The center-left, for example, represents neoliberalism with a human face. Its goal is to bring the policies of former US President Bill Clinton and former British Prime Minister Tony Blair into the twenty-first century, making only slight revisions to the prevailing modes of financialization and globalization. Meanwhile, the nationalist right disowns globalization, blaming migrants and foreigners for all of today’s problems. Yet as Donald Trump’s presidency has shown, it is no less committed – at least in its American variant – to tax cuts for the rich, deregulation, and shrinking or eliminating social programs.

By contrast, the third camp advocates what I call , which prescribes a radically different economic agenda, based on four priorities. The first is to

  1. restore the balance between markets, the state, and civil society. Slow economic growth, rising inequality, financial instability, and environmental degradation are problems born of the market, and thus cannot and will not be overcome by the market on its own. Governments have a duty to limit and shape markets through environmental, health, occupational-safety, and other types of regulation. It is also the government’s job to do what the market cannot or will not do, like actively investing in basic research, technology, education, and the health of its constituents.
  2. The second priority is to recognize that the “wealth of nations” is the result of  – learning about the world around us – and social organization that allows large groups of people to work together for the common good. Markets still have a crucial role to play in facilitating social cooperation, but they serve this purpose only if they are governed by the rule of law and subject to democratic checks. Otherwise, individuals can get rich by exploiting others, extracting wealth through rent-seeking rather than creating wealth through genuine ingenuity. Many of today’s wealthy took the exploitation route to get where they are. They have been well served by Trump’s policies, which have encouraged rent-seeking while destroying the underlying sources of wealth creation. Progressive capitalism seeks to do precisely the opposite.
  3. This brings us to the third priority: addressing the growing problem of concentrated . By exploiting information advantages, buying up potential competitors, and creating entry barriers, dominant firms are able to engage in large-scale rent-seeking to the detriment of everyone else. The rise in corporate market power, combined with the decline in workers’ bargaining power, goes a long way toward explaining why inequality is so high and growth so tepid. Unless government takes a more active role than neoliberalism prescribes, these problems will likely become much worse, owing to advances in robotization and artificial intelligence.
  4. The fourth key item on the progressive agenda is to sever the link between economic power and political influence. Economic power and political influence are mutually reinforcing and self-perpetuating, especially where, as in the US, wealthy individuals and corporations may spend without limit in elections. As the US moves ever closer to a fundamentally undemocratic system of “one dollar, one vote,” the system of checks and balances so necessary for democracy likely cannot hold: nothing will be able to constrain the power of the wealthy. This is not just a moral and political problem: economies with less inequality actually perform better. Progressive-capitalist reforms thus have to begin by curtailing the influence of money in politics and reducing wealth inequality.3

There is no magic bullet that can reverse the damage done by decades of neoliberalism. But a comprehensive agenda along the lines sketched above absolutely can. Much will depend on whether reformers are as resolute in combating problems like excessive market power and inequality as the private sector is in creating them.

A comprehensive agenda must focus on education, research, and the other true sources of wealth. It must protect the environment and fight climate change with the same vigilance as the Green New Dealers in the US and Extinction Rebellion in the United Kingdom. And it must provide public programs to ensure that no citizen is denied the basic requisites of a decent life. These include economic security, access to work and a living wage, health care and adequate housing, a secure retirement, and a quality education for one’s children.

This agenda is eminently affordable; in fact, we cannot afford not to enact it. The alternatives offered by nationalists and neoliberals would guarantee more stagnation, inequality, environmental degradation, and political acrimony, potentially leading to outcomes we do not even want to imagine.

Progressive capitalism is not an oxymoron. Rather, it is the most viable and vibrant alternative to an ideology that has clearly failed. As such, it represents the best chance we have of escaping our current economic and political malaise.

Want to raise successful kids? Harvard, MIT study says doing one thing at age 4 could make them happier and wealthier in life

Thanks to modern science, there are a number of effective — yet obvious — strategies to smart parenting. But last year, a group of researchers at MIT, Harvard and the University of Pennsylvania found that one of the best things parents can do for their children is to have frequent back-and-forth exchanges with them. 

The findings suggest that doing this at an early age (typically between ages 4 to 6) will help develop, foster and improve what is perhaps one of the most important skills that contribute to success in life: Communication.

What’s more, a number of studies have supported the idea that children with stronger communication skills are more likely to have healthier relationships, longer marriageshigher self-esteem and overall satisfaction in life.

.. We talk to our kids all the time — both directly and indirectly. “Sit here.” “Hurry, we’re going to be late.” “Great job!” “No, don’t do that.” “Alexa, read us a bedtime story.” The secret, however, is to have back-and-forth conversations.

For the study, researchers evaluated 36 children using functional magnetic resonance imaging (fMRI) to identify the differences in how the brain responds to different conversational styles.

They found that the Broca’s area, a region of the brain that focuses on speech production and language processing, was much more active in children who engaged in more back-and-forth conversations. Children who had more activation in that region of the brain scored higher in tests of language, grammar and verbal reasoning skills.

“The really novel thing about our paper is that it provides the first evidence that family conversation at home is associated with brain development in children,” John Gabrieli, the senior author of the study, told MIT News. “It’s almost magical how parental conversation appears to influence the biological growth of the brain.”

.. Back in 1995, a landmark study found that children from higher-income families appeared to have much greater language and communication abilities, and it was thought to be correlated with the fact that those children were exposed to about 30 million more words during the first years of life, compared to children of lower-income families.

But findings from this recent study suggest that the “30 million word gap” isn’t all it’s cracked up to be.

The conversational turn-taking seems like the thing that makes a difference, regardless of socioeconomic status,” Gabrielli said. “Such turn-taking occurs more often in families from a higher socioeconomic status, but children coming from families with lesser income or parental education showed the same benefits from conversational turn-taking.”

The point isn’t to have deep philosophical conversations with your children, but to instead carry conversations that require back-and-froth dialogue.

It’s not difficult to make that leap, and they’ll benefit in significant ways in the long run; interactive conversations help improve communication skills as a whole, and that’s a necessity for success in any future career. When it comes to your child’s success, maybe talk isn’t so cheap after all.

Gut bacteria may offer a treatment for autism

Autism affects people’s social behaviour and communication, and may impair their ability to learn things. All this is well known. Less familiar to most, though, are the gastrointestinal problems associated with the condition. The intestines of children with autism often harbour bacteria different from those in the guts of the neurotypical. As a consequence, such people are more than three times as likely as others are to develop serious alimentary-canal disorders at some point in their lives.

Unfortunate though this is, the upset gut floras of autistic people are seen by some investigators as the key to the condition—and to treating it. Recent research has shown that altering animals’ intestinal bacteria can have dramatic effects on their nervous systems. Ameliorating autism by tinkering with the ecology of the gut might thus be a fruitful line of inquiry.

A study just published in Neuron suggests that it is. In it, Mauro Costa-Mattioli of Baylor College of Medicine, in Texas, and his colleagues demonstrate that introducing a particular bacterium into the guts of mice that display autistic symptoms can abolish some of those symptoms. The bug in question is Lactobacillus reuteri. It is commonly found in healthy digestive systems and helps regulate acidity levels. And it is also easily obtainable for use as a probiotic from health-food shops.

.. Clearly, autism in people is more complicated than a mere willingness to associate with others. And getting too excited about a mouse trial is usually a mistake. But in Dr Costa-Mattioli’s view his results, which have been replicated in part by Evan Elliot’s laboratory in Bar-Ilan University, Israel, would justify embarking on at least preliminary trials intended to determine whether L. reuteri has positive effects on people with autism, and might thus be worth pursuing.

Others agree. Sarkis Mazmanian of the California Institute of Technology works in the same area. He says of these results: “I think the bar is now very low for getting this research moved on to human trials since most people already have these bacteria inside them and we know there are few, if any, safety or toxicity issues.”

The Exercise That Helps Mental Health Most

Certain fitness routines do more to help avoid depression, stress or other emotional problems, new research finds

Researchers looking at the link between physical activity and mental health found that team sports fared best, followed by cycling, either on the road or a stationary bike.

.. It found that physical activity typically performed in groups, such as team sports and gym classes, provided greater benefits than running or walking.

.. People who played team sports like soccer and basketball reported 22.3% fewer poor mental-health days than those who didn’t exercise. Those who ran or jogged fared 19% better, while those who did household chores 11.8% better.

.. In a secondary analysis, the researchers found that yoga and tai chi—grouped into a category called recreational sports in the original analysis—had a 22.9% reduction in poor mental-health days. (Recreational sports included everything from yoga to golf to horseback riding.)

.. The researchers also found that those who exercise between 30 and 60 minutes had the best mental health, with 45 minutes the optimal duration. Exercising three to five times a week correlated with fewer dark days.