Beyond ‘Consumer Keynesianism’

By now it is probably moot to declare that the global economy is in extreme crisis. In the US alone, millions of people have lost their jobs since this recession officially began[i]. Increasing percentages of the US population face difficulty in securing basic food, clothing, and shelter provisions.[ii] And last week, Iceland became the first nation to officially fold under the weight of the financial meltdown. Adding to the panic that we are probably all starting to feel,[iii] the Democrats and Republicans are squabbling over the specifics of the Trillion Dollar Obama bailout plan. Apparently, the House Republicans and some of their other unapologetically right wing zealot brethren in the Senate are dragging their feet and beating their chests at their Democrat counterparts for not including more tax cuts as part of the Obama plan. Pelosi and the Democrats are screaming back across the aisle ‘our plan as stands will get people to start spending again.’[iv] While contention might be appreciated in a conversation that will choose the paths that the US will follow in economic policy for some time to come,[v] this Washington squabbling is missing the mark, as should be anticipated when the Congressional brokers range from right wing nuts to white ‘liberals.’ [vi] Specifically, Congressional politicians are engaging in a series of limited debates that only attempt to engage whether or not the Obama plan will jump start the economy by either getting the banks to open credit so that people can buy more shit or by giving money directly to people so they can buy more shit. Isn’t an economy structured around spending lots of money that you don’t have, with banks and financier capital at the reigns, central to the whole mess that we’re in now? No one is publically questioning whether or not this plan will restructure the economy in ways that ensure that we will never again be hostage to Citi Group, Bank of America, or Check and Go. They are only arguing about how to get us back to our old spending habits. To ensure that ‘solutions’ for this financial crisis lead the Feds toward more humane economic policy, we need to pressure this collective conversation beyond the confines of Consumer Keynesianism.[vii] If we’re going to legitimize and recreate a Keynesian/Welfare State,[viii] we need to expand the boundaries of the government’s responsibilities beyond ensuring that we buy more trinkets on credit. The majority of us needs better, more secure resources to meet our basic needs. We need free universal healthcare. We need childcare. We need equitably funded schools. We need secure access to nutritious foods. And we need democratic control of our collective resources. We need more transparency and subsequent discussion about the provisions of the Obama plan that benefit the majority of us (hopefully there will be some).

[i] Although, the US economy has been fraying around the edges in urban centers and rural areas decimated by the movement of manufacturing capital abroad, for much longer.
[ii] And yes I know that people’s suffering is not an official part of the indicators of ‘economic health’ that economists use. Maybe they should rethink how they track economic growth. See the San Francisco based group, Redefining Progress’ work for some examples of the ways in which economists might incorporate people into their calculations.
[iii] I am excluding the ‘America will triumph’ pundits.
[iv] And in the foreground, Obama is playing an old Chicago-style political game by calling for a post-Partisan Washington, in effect, giving the dumbass Republicans just enough rope to ensure that they hang themselves before the midterm election.
[v] Twenty years if we can base this upon Reagan’s fixes, that led us to the set of crises at hand.
[vi] Be for real, Barbara Lee isn’t going to get a chance to touch this one.
[vii] Traditional Keynesianism is a set of economic policies by which state power is used theoretically to soften the impoverishing effects that Capital causes for Labor. In traditional Keynesian economics (think New Deal), US state power theoretically helped to temper Capital’s control of Labor by ensuring elementary provisions for workers, like Social Security, unemployment benefits, etc. and by helping to regulate Capital’s exploitative power, i.e. child labor restrictions, better working conditions, and the legalization of union organizing. By contrast, I use Consumer Keynesianism in a way reminiscent of Mike Davis’ Military Keynesianism. Specifically, Consumer Keynesianism is a set of economic principles by which state power has been/ is used to ensure that people continue buying junk on credit to ‘fuel our economy.’ Notably, the difference between more traditional Keynesianism and Consumer Keynesianism is the orientation of state power and resource allocation. At least theoretically, state power in the more traditional sense of Keynesianism was used to ensure basic livelihoods for the majority. In Consumer Keynesianism, state power is limited to helping capital profit via financial schemes, i.e. ensuring banks have money to lend us, rather than ensuring that there are resources for all of us to meet our basic needs.
[viii] And of course, this should not be our final goal either.