Re: Conference on Saving and Investment

["Anthony D'Costa" <dcosta@xxxxxxxxxxxxxxxx>]

Bill agrees with Paul Davidson's system of "civilized capitalism."  Since
when has capitalism become civilized?  Presumably after Keynes, if he
saved capitalism as many would argue?  But really this argument reeks of
what the apologists have been saying for a long time: the market solves
the problem in a contractual/legalistic/egalitarian and impersonal way.  But
does it?  If it does then we must have examples, and some must do it
better than others.  In other words, there are different forms of
capitalism, not only the "civilized" variety.

My using the Japanese and East Asian cases is to point out that there
variants of capitalism.  They are not certainly paradises on earth or for
that matter the most civilized capitalist societies.  But let us give
credit where it belongs.  Japan in the post-war period and Korea
in the 1950s were poor societies.  Today the average
Korean and Japanese feel good about this change.  Of course there will be
dissent and there will be ecological damage, if the rapidity of the
process of industrialization is accounted for.  But Japan or Korea are
neither like Australia nor the US.  The impact of industrialization will
be felt far more because of higher population density, smaller
cultivable land
mass, and rapid industrialization, in which case you have to take an
alternative path, perhaps a non-industrial path of development.  The
discourse is on but first the ideology of modernization and
industrialization must be shelved.  As far as I can see Paul's civilized
capitalism will not do it.

East Asia is not a good example.  I agree on several grounds.  The point,
however, was to indicate that the state and market mix does matter.  Call it
what you will, socialist-capitalist, hybrids, TVEs.  Labels and categories
are only analytical tools.
I cannot visualize a society that completely breaks with its past.
Australia and the US could (over 300 years) because of the elimination of
local resistance.
Therefore, to term East Asian societies repressive and hence not worth
discussing is rather disingenuous.  By whose standards are they
repressive?  Why cannot economists accept that societies can be
organized in different ways.  Why does it have to be in a
liberal-secular fashion? Imagine all the molotovs, brick bats, bottles
thrown by
South Korean students.  How many people are killed by the police in these
routine protests?  Any definition of
repression would have meant the absence of such protests.  Is this
(civilized) repression or does it reflect fundamentally the functioning of
a society on different principles?

It is true that in the long run (aren't we all dead:)?) industrialization
is ruinous environmentally but I am not ready to accept "civilized
capitalism" as the
answer.  There is always the issue of early entrant (a la
Gerschenkron, Hinkelammert, and more recently even Krugman) which makes
late comers fall behind.  Since, the problem in the world is not too
much consumption
but too little and in this sense I agree with Bill that is a matter of
redistribution, I think industrialization must remain the chief vehicle
by which to generate this surplus.



Anthony D'Costa