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Three Theses (not really: more like two graphs and a link) on Nazism and Capitalism

22 Apr

Commenters on my little Nazism and capitalism post are claiming that the graph tells us nothing about the Nazis and capitalism; it only tells us that the economy improved under the Nazis. As it did in the United States under FDR. So maybe the graph plotting capital’s return under Nazism just shows general improvement in the economy in the 1930s, an improvement widely shared throughout the industrial world?

Luckily, Suresh Naidu, the kick-ass economist at Columbia, supplied me with the following graphs.

This first graph, which comes from Thomas Piketty’s Capital in the Twenty-First Century, compares the share of national income that went to capital in the US and in Germany between 1929 and 1938. Suresh tells me that the share roughly tracks capital’s rate of return. Long story short: capital was doing better under the Nazis than under FDR. Not because of overall increases in economic performance in one country versus another but because of the economic policies of the regime. Or so Suresh tells me. (Usually academics are supposed to acknowledge their debts to their friends and readers but own all errors as their own: in this case, I’m blaming everything on Suresh.)

 

From Thomas Piketty, Capital in the Twenty-First Century

From Thomas Piketty, Capital in the Twenty-First Century

 

The second graph—which comes from this fascinating article by Thomas Ferguson and Hans-Joachim Voth, “Betting on Hitler: The Value of Political Connections in Nazi Germany“—tracks the stock market’s performance in Britain, US, France, and Germany, from January 1930 to November 1933. As you can see, in the early months that Hitler came to power, Germany’s stock market performance was quite strong, outstripping all the others; it’s not until July that it even crosses paths with Britain’s, the second best performer.

 

From Thomas Ferguson and Hans-Joachim Voth, "Betting on Hitler: The Value of Political Connections in Nazi Germany"

From Thomas Ferguson and Hans-Joachim Voth, “Betting on Hitler: The Value of Political Connections in Nazi Germany”

 

The last tidbit I want to share is this article by Germà Bell, “Against the Mainstream: Nazi Privatization in the 1930s,” from The Economic History Review. Phil Mirowski sent it to me, after I shared with him the Bell article on the language of privatization that I cited in my previous post. This article also has some fascinating findings. From the abstract:

In the mid-1930s, the Nazi regime transferred public ownership to the private sector. In doing so, they went against the mainstream trends in western capitalistic countries, none of which systematically reprivatized firms during the 1930s.

 

The Uncharacteristically Obtuse Mr. Chait

20 Mar

Jonathan Chait is no dummy. He’s one of the smartest political journalists around. So this bit of obtuseness in his critique yesterday of Ta-Nehisi Coates caught me by surprise.

Coates has been writing a series of pieces interrogating the idea of the culture of poverty, the notion that African American poverty is rooted in a deep tradition of bad values, bad behavior, bad choices, especially among black men. This idea used to be the exclusive preserve of the right; a milder version of it has since migrated to the liberal left.

In his latest dispatch, Coates wrote this:

Certainly there are cultural differences as you scale the income ladder. Living in abundance, not fearing for your children’s safety, and having decent food around will have its effect. But is the culture of West Baltimore actually less virtuous than the culture of Wall Street? I’ve seen no such evidence.

Here’s Chait in response:

Coates dismisses the culture objection in his latest piece by asking sardonically, “is the culture of West Baltimore actually less virtuous than the culture of Wall Street?” I think the example undermines his point. I have no idea how to compare Wall Street to West Baltimore, but it’s clear that Wall Street has an enormous cultural problem — which is to say it has normalized kinds of behavior that many of us consider bad.

Actually, the example undermines Chait’s point. Because Coates isn’t challenging the notion that Wall Street behavior isn’t bad or that there’s not a culture of bad behavior on Wall Street. He’s challenging the notion that it’s bad behavior, or the culture of bad behavior, that explains, in whole or in part, poverty in the black community.

All those guys on Wall Street act like jerks; yet somehow they don’t wind up poor.  That’s Coates’s point. If the culture on Wall Street is not more elevated than that of West Baltimore, something other than the culture on Wall Street and the culture in West Baltimore has to explain the wealth of the one and the poverty of the other.

“The rich are different from you and me,” Fitzgerald is supposed to have said to Hemingway. “Yes,” Hemingway responded, “they have more money.” The conversation, of course, never happened. Even so, Hemingway got it right.

Death and Taxes

13 Feb

Last year, I said, somewhat tongue in cheek, that socialism is about converting hysterical misery into ordinary unhappiness.

This is what I meant. Socialism won’t eliminate the sorrows of the human condition. Loss, death, betrayal, disappointment, hurt: none of these would disappear or even be mitigated in a socialist society. As the Pirkei Avot puts it, against your will you enter this world, against your will you leave it (or something like that). That’s not going to change under socialism. But what socialism can do is to arrange things so that you can actually deal with and confront these unhappinesses of the human condition.

I was reminded of that reading this wonderful piece by Anya Shiffrin about the death of her father.

Last spring, André Shiffrin, the legendary publisher, was diagnosed with pancreatic cancer (he died in December). A New Yorker through and through, he nevertheless decided to spend his last months in Paris, where he and his wife had an apartment and where he had been born. It proved to be a wise move, as Anya explains.

So imagine my surprise when my parents reported from Paris that their chemo visits couldn’t be more different [than they had been at Memorial Sloane Kettering in New York]. A nurse would come to the house two days before my dad’s treatment day to take his blood. When my dad appeared at the hospital, they were ready for him. The room was a little worn and there was often someone else in the next bed but, most important, there was no waiting. Total time at the Paris hospital each week: 90 minutes.

There were other nice surprises. When my dad needed to see specialists, for example, instead of trekking around the city for appointments, he would stay in one room at Cochin Hospital, a public hospital in the 14th arrondissement where he received his weekly chemo. The specialists would all come to him. The team approach meant the nutritionist, oncologist, general practitioner and pharmacist spoke to each other and coordinated his care. As my dad said, “It turns out there are solutions for the all the things we put up with in New York and accept as normal.”

One day he had to spend a few hours at Cochin. They gave him, free of charge, breakfast and then a hot lunch that included salad and chicken. They also paid for his taxi to and from the hospital each week.

“Can’t you think of anything bad about the French healthcare system?” I asked during one of our daily phone calls. My mom told me about a recent uproar in the hospital: It seems a brusque nurse rushed into the room and forgot to say good morning. “Did you see that?” another nurse said to my mom. “She forgot to say bonjour!”

As Anya goes onto explain, her father wasn’t “getting VIP treatment or had a fancy private plan. Not at all. He had the plain vanilla French government healthcare.” She also points out that health care spending is much lower in France.

French health care couldn’t stop André Shiffrin from dying; nothing in this world could. Instead it helped him and his family confront and deal with his dying, without the distraction and mayhem of our system. It’s not that taxes can save you from dying; it’s, well, here’s Anya:

When my dad began to get worse, the home visits started. Nurses came three times a day to give him insulin and check his blood. The doctor made house calls several times a week until my father died on December 1.

The final days were harrowing. The grief was overwhelming. Not speaking French did make everything more difficult. But one good thing was that French healthcare was not just first rate — it was humane. We didn’t have to worry about navigating a complicated maze of insurance and co-payments and doing battle with billing departments.

Every time I sit on hold now with the billing department of my New York doctors and insurance company, I think back to all the things French healthcare got right. The simplicity of that system meant that all our energy could be spent on one thing: caring for my father.

That time was priceless.

In my Freudian (late Freud) moments of despair, I sometimes wonder if the madness of American capitalism isn’t one massive contrivance to avoid the sadness and finitude of the human condition. Filing our insurance claims, haggling on the phone, waiting for doctors, we don’t have time or space to deal with death. At least not properly. That’s what socialism might help us do. Perhaps that’s why we don’t want it.

Socialism is not a flight from the human condition; it’s a direct and unsentimental confrontation with that condition.

The Beauty of the Blacklist: In Memory of Pete Seeger

29 Jan

Pete Seeger’s death has prompted several reminiscences about his 1955 appearance before the House Committee on Un-American Activities (HUAC). And for good reason. Two good reasons, in fact.

First, Seeger refused to answer questions about his beliefs and associations—up until the 1940s, he had been a member of the Communist Party—not on the basis of the Fifth Amendment, which protects men and women from self-incrimination, but on the basis of the First Amendment’s protection of freedom of speech.

While invoking the Fifth was not without its perils—most important, it could put someone on the blacklist; individuals who invoked it frequently found themselves without work—it had the advantage of keeping one out of jail. But the cost of the 5th was clear: though you could refuse to testify about yourself, you could not refuse to testify about others.

So Seeger invoked the First Amendment instead. A far riskier legal position—the Court had already held, in the case of the Hollywood Ten, that the First Amendment did not protect men and women who refused to testify before HUAC—it was the more principled stance. As Seeger explained later, “The Fifth means they can’t ask me, the First means they can’t ask anybody.” And he paid for it. Cited for contempt of Congress, he was indicted, convicted, and sentenced to a year in prison. Eventually the sentence got overturned.

Second, not only did Seeger refuse to answer questions about his associations and beliefs, but he also did it with great panache. When asked by HUAC to name names, he refused—and then almost immediately offered to sing songs instead. Much to the consternation of the Committee chair, Francis Walters, Seeger followed up with a more personal offer.

I know many beautiful songs from your home county, Carbon, and Monroe, and I hitchhiked through there and stayed in the homes of miners.

Parenthetically, I should note that Seeger’s hearings were not the only such circus of absurdity.  If you want to treat yourself to an afternoon of giggles, check out Ayn Rand’s testimony, where she insisted that no one in Russia ever smiled. Or this wondrous exchange between Zero Mostel and two members of HUAC.

Mostel: If I appeared there, what if I did an imitation of a butterfly at rest? There is no crime in making anybody laugh. I don’t care if you laugh at me.
Congressman Donald Jackson: If your interpretation of a butterfly at rest brought any money into the coffers of the Communist Party, you contributed directly to the propaganda effort of the Communist Party.
Mostel: Suppose I had the urge to do the butterfly at rest somewhere?
Congressman Clyde Doyle: Yes, but please, when you have the urge, don’t have such an urge to put the butterfly at rest by putting some money in the Communist Party coffers as a result of that urge to put a butterfly at rest.

But I digress.

While Seeger’s HUAC appearance, and its legal aftermath, is making the rounds of his eulogists, it’s important to remember that HUAC was probably not the most difficult of his tribulations during the McCarthy era. Far more toxic for most leftists was the blacklist itself. From the early 1950s to the mid-1960s (the dates are fuzzy, and it depends on which particular medium we’re talking about), Seeger was prevented from performing on a great many stages and venues. First with The Weavers, and then on his own.

The blacklist did not work independently of the state. It was the transmission belt of the state, both a feeder to, and an enforcement mechanism of, the government. Men and women who didn’t cooperate with the government were subject to the blacklist, so it was a useful means of securing cooperation and providing information. The secret enforcers of the blacklist were often ex-FBI men or ex-HUAC staffers, and the FBI and HUAC supplied critical information to industry executives and their underlings. Who then used it for either political or narrower self-interested purposes.

That said, the blacklist, and the more general specter of private penalties, touched more people than did HUAC or the state. For most men and women during the McCarthy years, the immediate point of contact with political repression and coercion was their employer, their teacher, their therapist, their lawyer, their supervisor, their co-worker.

And that raises a larger question. It is easy today to look back on that time, to read the transcripts and case histories, and tut-tut at all the nastiness or laugh at all the foolishness of the blacklist. With everyone from President Obama to the New York Times delivering warm encomia for Seeger, we forget that the blacklist only worked because so many people like President Obama, like the editors of the New York Times—who refused during the McCarthy years to hire anyone who was a member of the Communist Party—worked together to make it work.

To be sure, there were many hard-right ideologues behind the blacklist: the writers at Red Channels, an anticommunist handbook that named names in the entertainment industry, were conservative propagandists of the first order, anatomized to brilliant effect by a young researcher by the name of Michael Harrington.

But the blacklist would never have had the reach it did—not merely in Hollywood or the academy, but throughout virtually every industry in the United States—had it not attracted a wide range of men and women to its cause. The blacklist was also the work of liberal pamphleteers, executives in the culture industries, influential politicians in and around the Democratic Party, and most prominent of all, J. Edgar Hoover, about whom Arthur Schlesinger wrote:

All Americans must bear in mind J. Edgar Hoover’s warning that counter-espionage is no field for amateurs. We need the best professional counterespionage agency we can get to protect our national security.

Far from being the object of liberal derision that he is today, Hoover was, in his time, thought to be the consummate rational bureaucrat, a professional of the first order who needed, said the liberals, more money, more resources, more power, not less. As Hubert Humphrey declared:

If the FBI does not have enough trained manpower to do this job, then, for goodness sake, let us give the FBI the necessary funds for recruiting the manpower it needs….This is a job that must be done by experts.

For liberals, Hoover, the ultimate impresario of the blacklist, was someone to collaborate with, not contend against.

The blacklist, as Victor Navasky reminded us long ago, was the triumphant realization of a perverse version of Adam Smith’s Invisible Hand. Everyone pursued their own private or personal definition of the good; the result was cooperation, exchange—and coercion. What’s most striking about the blacklist is just how diversely inspired, and collaborative, its various protagonists were. Some were hardcore anticommunist true believers. Others were cold calculators of the bottom line. Some were patriots, others careerists, and still others cowards. There were liberals, conservatives, socialists, ex-communists, atheists, Catholics, libertarians, Jews.

Most amazingly, these differences didn’t matter. Despite what virtually every modern political theorist—from Hobbes to Montesquieu to Madison—maintains, pluralism and diversity did not lead to liberty, anarchy, or disorder. Instead, they provided more avenues and opportunities for collusion, collaboration, and coercion.

Beyond the collusion and collaboration, there’s another dimension of the blacklist worth mentioning: the intense and dense infrastructure of support, at the lowest levels, that made the machine go. When we think about political repression, we tend to focus on elites, officials on high, industry executives, and the like. But the blacklist was the work of hundreds of thousands of men and women, operating at the middling and lower tiers of institutions and organizations.

In some way, we could say that the blacklist is the dark answer to Bertolt Brecht’s poem “Questions from a Worker Who Reads.” Long invoked by the left as a tribute to the anonymous laboring heroes of history, the poem can also be read as a more unsettling account of the invisible but necessary labor that goes into the production of political crimes like aggressive war or imperial conquest.

Who built Thebes of the 7 gates?
In the books you will read the names of kings.
Did the kings haul up the lumps of rock?

And Babylon, many times demolished,
Who raised it up so many times?

In what houses of gold glittering Lima did its builders live?
Where, the evening that the Great Wall of China was finished, did the masons go?

Great Rome is full of triumphal arches.
Who erected them?

Over whom did the Caesars triumph?
Had Byzantium, much praised in song, only palaces for its inhabitants?

Even in fabled Atlantis, the night that the ocean engulfed it,
The drowning still cried out for their slaves.

The young Alexander conquered India.
Was he alone?

Caesar defeated the Gauls.
Did he not even have a cook with him?

Philip of Spain wept when his armada went down.
Was he the only one to weep?

Frederick the 2nd won the 7 Years War.
Who else won it?

Every page a victory.
Who cooked the feast for the victors?

Every 10 years a great man.
Who paid the bill?

So many reports.

So many questions.

“Did he not even have a cook with him?” That question is often with me. Not just in the context of the blacklist, but in other, far more terrible circumstances. Like genocide.

This past weekend I watched “Conspiracy” on Youtube. It’s a BBC reenactment of the 1942 Wannsee Conference, at which various officials (many now forgotten) of the Nazi regime gathered to draw up plans for the deportation and mass murder of the Jews. The opening sequence of the film—in which the house staff at the villa on the Wannsee scramble to prepare for the arrival of regime’s elite—does a brilliant job of answering Brecht’s question. Yes, there were cooks at Wannsee. Lots of them. And maids, waiters, butlers, secretaries, transcriptionists, drivers: an entire army of support staff helping to make the conference go off without a hitch. Eichmann, who organized the logistics of the conference, comes off less as an architect of mass murder than as an anxious host of a dinner party, the Martha Stewart of the Shoah.

Hart Crane marveled at the Brooklyn Bridge: “How could mere toil align thy choiring strings!” And like the Brooklyn Bridge, large-scale enterprises like genocide or the blacklist—needless to say, I am in no way equating these phenomena—entail the aligning of choiring strings. Not only through spectacular mobilization of the masses or ideological indoctrination from on high but also through the most mundane and individual calculations of career.

Political crime is work. Whether the crime is mass murder or persecution, someone has to do that work. And to help the people who do that work. So men and women must be hired and paid, supervised and promoted.

At the height of European imperialism, Disraeli wrote, “The East is a career.” So was the Holocaust. So was the blacklist.

While we rightly recall today the heroism of Pete Seeger in refusing to make the blacklist a career—indeed, sacrificing his career in order to unmake the blacklist—we have to ask ourselves how many of us would have chosen the path he did. Particularly in the United States, where the obligations of career are nearly the first item on our list of civic duties.

Socialism: Converting Hysterical Misery into Ordinary Unhappiness for a Hundred Years

10 Dec

In yesterday’s New York Times, Robert Pear reports on a little known fact about Obamacare: the insurance packages available on the federal exchange have very high deductibles. Enticed by the low premiums, people find out that they’re screwed on the deductibles, and the co-pays, the out-of-network charges, and all the different words and ways the insurance companies have come up with to hide the fact that you’re paying through the nose.

For policies offered in the federal exchange, as in many states, the annual deductible often tops $5,000 for an individual and $10,000 for a couple.

Insurers devised the new policies on the assumption that consumers would pick a plan based mainly on price, as reflected in the premium. But insurance plans with lower premiums generally have higher deductibles.

In El Paso, Tex., for example, for a husband and wife both age 35, one of the cheapest plans on the federal exchange, offered by Blue Cross and Blue Shield, has a premium less than $300 a month, but the annual deductible is more than $12,000. For a 45-year-old couple seeking insurance on the federal exchange in Saginaw, Mich., a policy with a premium of $515 a month has a deductible of $10,000.

In Santa Cruz, Calif., where the exchange is run by the state, Robert Aaron, a self-employed 56-year-old engineer, said he was looking for a low-cost plan. The best one he could find had a premium of $488 a month. But the annual deductible was $5,000, and that, he said, “sounds really high.”

By contrast, according to the Kaiser Family Foundation, the average deductible in employer-sponsored health plans is $1,135.

It’s true that if you’re a family of three, making up to $48,825 (or, if you’re an individual, making up to $28,725), you’ll be eligible for the subsidies. Those can be quite substantive at the lower ends of the income ladder. But as you start nearing those upper limits (which really aren’t that high; below the median family income, in fact), the subsidies start dwindling. Leaving individuals and families with quite a bill, as even this post, which is generally bullish on Obamacare, acknowledges.

Aside from the numbers, what I’m always struck by in these discussions is just how complicated Obamacare is. Even if we accept all the premises of its defenders, the number of steps, details, caveats, and qualifications that are required to defend it, is in itself a massive political problem. As we’re now seeing.

More important than the politics, that byzantine complexity is a symptom of what the ordinary citizen has to confront when she tries to get health insurance for herself or her family. As anyone who has even good insurance knows, navigating that world of numbers and forms and phone calls can be a daunting proposition. It requires inordinate time, doggedness, savvy, intelligence, and manipulative charm (lest you find yourself on the wrong end of a disgruntled telephone operator). Obamacare fits right in with that world and multiplies it.

I’m not interested in arguing here over what was possible with health care reform and what wasn’t; we’ve had that debate a thousand times. But I thought it might be useful to re-up part of this post I did, when I first started blogging, on how much time and energy our capitalist world requires us to waste, and what a left approach to the economy might have to say about all that. It is this world of everyday experience—what it’s like to try and get basic goods for yourself and/or your family—that I wish the left (both liberals and leftists) was more in touch with.

The post is in keeping with an idea I’ve had about socialism and the welfare state for several years now. Cribbing from Freud, and drawing from my own anti-utopian utopianism, I think the point of socialism is to convert hysterical misery into ordinary unhappiness. God, that would be so great.

• • • • • •

There is a deeper, more substantive, case to be made for a left approach to the economy. In the neoliberal utopia, all of us are forced to spend an inordinate amount of time keeping track of each and every facet of our economic lives. That, in fact, is the openly declared goal: once we are made more cognizant of our money, where it comes from and where it goes, neoliberals believe we’ll be more responsible in spending and investing it. Of course, rich people have accountants, lawyers, personal assistants, and others to do this for them, so the argument doesn’t apply to them, but that’s another story for another day.

The dream is that we’d all have our gazillion individual accounts—one for retirement, one for sickness, one for unemployment, one for the kids, and so on, each connected to our employment, so that we understand that everything good in life depends upon our boss (and not the government)—and every day we’d check in to see how they’re doing, what needs attending to, what can be better invested elsewhere. It’s as if, in the neoliberal dream, we’re all retirees in Boca, with nothing better to do than to check in with our broker, except of course that we’re not. Indeed, if Republicans (and some Democrats) had their way, we’d never retire at all.

In real (or at least our preferred) life, we do have other, better things to do. We have books to read, children to raise, friends to meet, loved ones to care for, amusements to enjoy, drinks to drink, walks to take, webs to surf, couches to lie on, games to play, movies to see, protests to make, movements to build, marches to march, and more. Most days, we don’t have time to do any of that. We’re working way too many hours for too little pay, and in the remaining few hours (minutes) we have, after the kids are asleep, the dishes are washed, and the laundry is done, we have to haggle with insurance companies about doctor’s bills, deal with school officials needing forms signed, and more.

What’s so astounding about Romney’s proposal—and the neoliberal worldview more generally—is that it would just add to this immense, and incredibly shitty, hassle of everyday life. One more account to keep track of, one more bell to answer. Why would anyone want to live like that? I sure as hell don’t know, but I think that’s the goal of the neoliberals: not just so that we’re more responsible with our money, but also so that we’re more consumed by it: so that we don’t have time for anything else. Especially anything, like politics, that would upset the social order as it is.

…We saw a version of it during the debate on Obama’s healthcare plan. I distinctly remember, though now I can’t find it, one of those healthcare whiz kids—maybe it was Ezra Klein—tittering on about the nifty economics and cool visuals of Obama’s plan: how you could go to the web, check out the exchange, compare this little interstice of one plan with that little interstice of another, and how great it all was because it was just so fucking complicated.

I thought to myself: you’re either very young or an academic. And since I’m an academic, and could only experience vertigo upon looking at all those blasted graphs and charts, I decided whoever it was, was very young. Only someone in their 20s—whipsmart enough to master an inordinately complicated law without having to make real use of it—could look up at that Everest of words and numbers and say: Yes! There’s freedom!

That’s what the neoliberal view reduces us to: men and women so confronted by the hassle of everyday life that we’re either forced to master it, like the wunderkinder of the blogosphere, or become its slaves. We’re either athletes of the market or the support staff who tend to the race.

That’s not what the left wants. We want to give people the chance to do something else with their lives, something besides merely tending to it, without having to take a 30-year detour on Wall Street to get there. The way to do that is not to immerse people even more in the ways and means of the market, but to give them time and space to get out of it. That’s what a good welfare state, real social democracy, does: rather than being consumed by life, it allows you to make your life. Freely. One less bell to answer, not one more.

Adam Smith ♥ High Wages

23 Nov

The Wealth of Nations:

The liberal reward of labour, therefore, as it is the effect of increasing wealth, so it is the cause of increasing population. To complain of it, is to lament over the necessary effect and cause of the greatest public prosperity.

The liberal reward of labour, as it encourages the propagation, so it increases the industry of the common people. The wages of labour are the encouragement of industry, which, like every other human quality, improves in proportion to the encouragement it receives….Where wages are high, accordingly, we shall always find the workmen more active, diligent, and expeditious, than where they are low.”

When Richard Nixon Met Karl Polanyi

30 Oct

In 1969, while he was working on Richard Nixon’s Family Assistance Plan, which would have guaranteed an income of $1600 plus $800 in food stamps to every family of four, Daniel Patrick Moynihan was deputized by Nixon to investigate the historical accuracy of one of Karl Polanyi’s claims in The Great Transformation.

Polanyi had argued that Britain’s Speenhamland system—like Nixon’s plan, it would have guaranteed an annual income to poor families, regardless of whether they worked or not—had the perverse effect of making the poor poorer. Reiterating claims made by Marx and Engels, Polanyi wrote that Speenhamland allowed, even encouraged, employers to hire workers at below-subsistence wages (the poor were guaranteed an income regardless of whether they worked). Because workers would start losing their income  supports once they earned more than a subsistence wage, and because employers were more than happy to have local parishes supplement or subsidize wages, Speenhamland effectively put a cap on wages. Productivity went down, and with it, poor rates and income supports.  The long-term result, said Polanyi, was increased immiseration among the poor.

Few people have attended to Polanyi’s caveat that had the working poor not been prohibited by the Anti-Combination Laws of 1799-1800 from organizing themselves they might have been able to reverse these effects. (Admittedly, that point only gets a passing mention in Polanyi’s chapters on Speenhamland.) Instead, his argument has been taken as Exhibit A of Albert Hirschman’s perversity thesis: policies designed to achieve positive ends, particularly when those ends relate to the poor, often produce the opposite of their aims. (Hirschman himself made a nod to these linkages.)

When Nixon began mooting his version of Speenhamland in the early part of 1969, talk of perversity (in all senses) was very much in the air. In mid-April, the economist Martin Anderson—then a White House staffer, but previously a devotee of Ayn Rand; Anderson has also been credited with bringing Alan Greenspan, another Randian, into government—prepared a report on the history of poor assistance, which was essentially little more than a series of extracts about Speenhamland from The Great Transformation.

So troubled was Nixon by this history that he had Moynihan personally undertake an assessment of Polanyi’s findings. Moynihan set his staff right to it, resulting in a team of bureaucrats surveying all the most up-to-date historical literature on Speenhamland.

As Fred Block and Margaret Somers—from whose wonderfully informative 2003 article in Politics & SocietyIn the Shadow of Speenhamland: Social Policy and the Old Poor Law” I have cribbed this story—concluded:

The Family Assistance Plan was ultimately defeated in the U.S. Senate but only after Richard Nixon had a conversation about the work of Karl Polanyi.

Update (12:30 pm)

There’s an ungated version of Block’s and Somers’ article here.

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