What's the use of Economics for the Left?

± 7 minutes
‟Socialist economists can change the limits of the possible.

How can the Left use economics as a tool in the twenty-first century? Four eminent, leftist economists provided an answer; David Ruccio, Johanna Bockman, Prabhat Patnaik and Andrew Kliman. And we're asking you to join the discussion.

Last week, SE published the answers from four eminent leftist economists / economic thinkers to the question: 'What economic obstacles is the Left facing in the 21st Century?' David Ruccio, Johanna Bockman, Prabhat Patnaik and Andrew Kliman answered this question, all in their own way, providing us with an interesting diversity of views.

This week, we're publishing answers from the same economists to a new question:

How can the Left use economics as a tool in the twenty-first century?

Why ask this particular question? Firstly, because there's an intensive and global debate about the use of economics in general, with many people doubting whether this field, which failed to predict the last economic crisis (2007-08), has any practical or scientific value at all. So the question arises: is economics useful at all and if so, how is it useful for the Left? What's more, we should realize that the field of economics is incredibly diverse, including many competing schools of thought, and as leftists we should think about what areas of this field are in any way relevant to the Left.

This collection of answers from Ruccio, Bockman, Patnaik and Kliman, published below, aims to contribute to this debate.

We hope you will join and support this dialogue: share this article online, by retweeting or sharing it on facebook. But most importantly, contribute your own views: in the comment section at the bottom of this article or as a reply to our twitter- or facebookposts.

P.S.: SE will apply the same concept - asking one question to several thinkers - more often in the future. We are open to suggestions about future questions to be asked. Email your idea(s) to: join [at] socialisteconomist.com

‟Socialist economists can change the limits of the possible.

About the author (click)
Dr. David F. Ruccio is a renowned marxian economist, professor of economics at the University of Notre Dame, where he has taught since 1982. He is also a member of the Higgins Labor Studies Program and the Joan B. Kroc Institute for International Peace Studies. He blogstweets, and contributes to the journal Rethinking Marxism (which he edited for twelve years), Real World Economics Review and Democracy at Work. On twitter: @Dfruccio
Socialist economists can help identify the ways the current problems of American capitalism are not just a matter of economic “imperfections,” but deeply embedded in capitalism itself. Moreover, the Left has the opportunity to propose changes that benefit workers in the short term and empower the working-class to make additional changes over time. Socialist economists can play a key role in the ongoing debates within economic theory (regarding stagnant wages, growing inequality, the one-sided nature of the recovery, and so on) and national politics (concerning universal healthcare, student debt, precarious jobs, and the like) — and to engage the rehabilitation of socialism as a legitimate position within American politics. For example, socialist economists can change the debate about inequality and explain how it is a product not of a lack of skills, but of rising exploitation and the distribution of the growing surplus to the top 10 percent. Similarly, they can change the limits of the possible by showing how movement in the direction of universal healthcare can improve the lives of working-class Americans and, at the same time, create the space for other ways of organizing healthcare itself — by expanding worker cooperatives and other community-oriented ways of providing health services.

‟The Left could use the economics of Raúl Prebisch.

About the author (click)
Johanna K. Bockman is Associate Professor of Sociology and Global Affairs at George Mason University and works in economic sociology, urban sociology, sociology of globalization, and East European Studies. On twitter: @DCSociologyWrd6.
The Left could use the economics of Raúl Prebisch. In 1950, Prebisch and Hans Singer independently developed the theory of the deteriorating terms of trade, now famous as the Singer-Prebisch thesis. In classical economic theory, Malthus argued that expanding populations would make raw materials scarcer and more expensive, thus increasing their prices relative to manufactured products. In contrast, as Prebisch and Singer explained, raw material prices would decrease. The deteriorating terms of trade for raw materials meant many things, including the urgent need for former colonies to move beyond colonialism’s imposition of single-commodity economies (such as those based only on coffee or sugar) and diversify their economies with manufacturing, services, and other raw material production. This situation required the re-structuring of the world economy to redistribute production, trade, finance, and markets.

In 1964, Prebisch became UNCTAD’s first secretary-general and was a vocal critic of national import substitution and protectionism. He and his colleagues in UNCTAD envisioned an integrated system of institutions, related to production, markets, trade, and finance, to realize a new international economic order. These attempts to build global ties, as opposed to bilateral neocolonial ties and laissez-faire policies, required a great deal of institution building and re-structuring.

‟To counter the fascist threat on an enduring basis, it must suggest an alternative economic agenda.

About the author (click)
Prabhat Patnaik is Professor Emeritus at the Centre for Economic Studies and Planning, Jawaharlal Nehru University, New Delhi. His books include Accumulation and Stability Under Capitalism (1997), The Value of Money (2009), and Re-envisioning Socialism (2011). Find his blog posts at IDEAs here. 
The crisis of neo-liberal capitalism has compounded the distress of the working people everywhere. With the liberal bourgeoisie helpless against the crisis, and the Left weakened as discussed, fascist, and semi-fascist forces are on the ascendancy everywhere, posing a serious threat to democracy.

The Left has to lead the struggle to save democracy. To counter the fascist threat on an enduring basis, it must suggest an alternative economic agenda.

Let me focus on India. The distress of the peasantry has been intense. Those displaced from rural areas have flocked to cities, swelling the reserve army, and worsening urban living. A worker-peasant alliance must be built politically with an agenda of instituting a set of universal, justiciable, Constitutionally-guaranteed fundamental economic rights, which ensures immediate economic relief.

Five such rights, Right to Food, Right to Employment (or full wage payment in its absence), Right to free publicly-provided quality healthcare, Right to free publicly-provided quality education up to a certain level, and Right to adequate Old-age Pensions and Disability Benefits, will cost less than 10 percent of the GDP, which a country with a tax-GDP ratio of 16 percent can easily afford. This would thwart the fascists, and act as a “transitional measure” for transcending neo-liberal capitalism.

‟I think a concerted return to the specifics of Marx’s work is warranted.

About the author (click)
Andrew Kliman is a professor emeritus of economics at Pace University, author of many books on marxian economics (full CV here) and known for defending Marx's labor theory against claims of inconsistency from mainstream economics (see his book Reclaiming Marx's "Capital": A Refutation of the Myth of Inconsistency (2006)).
Ithink a concerted return to the specifics of Marx’s work is warranted. A lot of lip-service is paid to him, but leftists generally turn him into an icon who said very little that is distinctive and nothing that is “threatening.” They regard the specificity of his ideas as a distraction from, or interference with, their aims. Others want to attach his name to perspectives and projects that have more in common with the tendencies he fought than with his own ideas.

To take just one example, they frequently suppress the fact that Capital combats the political economy of Proudhon and others who claimed that the ills of capitalism can be ameliorated by reforming monetary, exchange, and financial relations, while leaving the capitalist mode of production intact. Marx’s critique has become newly relevant in light of efforts to prevent the next economic crisis by reforming the financial system.

In 1875, Marx even opposed the unification of socialist political parties in Germany because he regarded the ideas in their Gotha Program as wrong and inadequate. In particular, its call for “fair distribution” of income was strikingly similar to the Proudhonist perspective. He would not let the desire for unity interfere with the need to understand the world correctly in order to change it effectively.

Related: All authors have published on SE before. Find their articles by clicking on their names: David F. Ruccio, Johanna BockmanPrabhat Patnaik, Andrew Kliman

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