das lebendige bewusstsein über die verbindung zwischen der ... · athen, 2011 you can’t run on...
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Die Verheissung der Soziologie:
“(...) das lebendige Bewusstsein über die Verbindung zwischen der persönlichen Erfahrung und der Gesellschaft als Ganzem.”
-- Charles Wright Mills, 1959
Athen, 2011
You Can’t Run on One Leg
–
Negative Integration in the EU as a Dysfunctional
Mixed Economy
Ak PolÖk / WEC FFM, 17.10.2014
Max Held BIGSSS/Uni Bremen
Allokation & Effizienz Verteilung Stabilisierung
MarktMarktgleichgewicht ist pareto-optimal
(über eine gegebene (ex-ante) Verteilung)(unter heroischen Annahmen)
Marktversagen Allmendegüter, Risikopools, …
Winner-take-all, monopsistische Arbeitgeber …
KonjunkturzyklenHandelsbilanz-
ungleichgewichte
Intakte Mischwirtschaft
Regulierung Steuern
Regulierung Steuern
Geldpolitik Steuern
Figure 1: Means and Ends of the Mixed Economy
Dimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human NeedDimensions of Material Human Need
ProductionaProductionaProductionaProductiona Riskb Distribution (vertically)cDistribution (vertically)cDistribution (vertically)cDistribution (vertically)cDistribution (vertically)cDistribution (vertically)cDistribution (vertically)cDistribution (vertically)c TimedTimed Space (horizontal)eSpace (horizontal)eSpace (horizontal)eSpace (horizontal)eSpace (horizontal)e
Humanf
FrailtyHumanf
CrisisHumanf
Modern Fit
Exchangeg
Success
Exchangeg
Success
Exchangeg Failure
Exchangeg Failure
Exchangeg Failure
Exchangeg Failure
Exchangeg Failure
Command h
Regu-latory
iCommand h
Regu-latory
iCommand h
Fiscalj
Command h
Fiscalj
Command h
Mone-tary
k
DisorganizationlDisorganizationlDisorganizationlDisorganizationl Ignorancev Dominance strategieszDominance strategieszDominance strategieszDominance strategieszDominance strategieszDominance strategieszDominance strategieszDominance strategiesz Myopia , herdingMyopia , herding ParochialismParochialismParochialismParochialismParochialism Conditionf
SubsistencelSubsistencelSubsistencelSubsistencel Black swansv Dominance hierarchieszDominance hierarchieszDominance hierarchieszDominance hierarchieszDominance hierarchieszDominance hierarchieszDominance hierarchieszDominance hierarchiesz Time inconsistencyTime inconsistency AutarkyAutarkyAutarkyAutarkyAutarkyConditionf
Maximum output for minimal inputslMaximum output for minimal inputslMaximum output for minimal inputslMaximum output for minimal inputsl Downside risk aversionv Affiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismzAffiliative strategiesz / Reciprocal altruismz Golden rule savings rateGolden rule savings rate CosmopolitanismCosmopolitanismCosmopolitanismCosmopolitanismCosmopolitanism
Conditionf
Competitive equilibriummCompetitive equilibriummCompetitive equilibriummCompetitive equilibriumm Insurancew Pareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityA InterestInterest
TradeTradeTradeTradeTrade
Marketg
Competitive equilibriummCompetitive equilibriummCompetitive equilibriummCompetitive equilibriumm Insurancew Pareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityAPareto optimalityA InterestInterest Absolute advantage
Comparative advantage
Factor price
equalization
Factor price
equalization
Economies of
scale
Marketg
ExternalitiesExternalitiesExternalities Information asymmetryInformation asymmetryInformation asymmetry Winner-take-allB
Baumol’s Cost
DiseaseB
Differential budget
constraintsC
Differential budget
constraintsC
Differential budget
constraintsC
Diminishing marginal utilityD
(Employer) market powerF
Positional externality
E
Short-term Long-termNo trade for some
Different terms of
tradeBrain drainBrain drain Agglo-
meration
Marketg
ExternalitiesExternalitiesExternalities Information asymmetryInformation asymmetryInformation asymmetry Winner-take-allB
Baumol’s Cost
DiseaseB
Differential budget
constraintsC
Differential budget
constraintsC
Differential budget
constraintsC
Diminishing marginal utilityD
(Employer) market powerF
Positional externality
E
business cycle,
bubbles & panics,de- &
inflation
under-saving (CPR)
No trade for some
Different terms of
tradeBrain drainBrain drain Agglo-
meration
Marketg
ExternalitiesExternalitiesExternalities Information asymmetryInformation asymmetryInformation asymmetry Winner-take-allB
Baumol’s Cost
DiseaseB
Differential budget
constraintsC
Differential budget
constraintsC
Differential budget
constraintsC
Diminishing marginal utilityD
(Employer) market powerF
Positional externality
E
business cycle,
bubbles & panics,de- &
inflation
under-saving (CPR)
Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)
Marketg
Public goodo
Common goodp
(Natural) market powerq
Principal-Agent
problem
Adverse selectionx,
Moral hazardx
Efficiency wages
Winner-take-allB
Baumol’s Cost
DiseaseB
Differential budget
constraintsC
Differential budget
constraintsC
Differential budget
constraintsC
Diminishing marginal utilityD
(Employer) market powerF
Positional externality
E
business cycle,
bubbles & panics,de- &
inflation
under-saving (CPR)
Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)Or: balance of payments crises (in the long run)
Marketg
Public goodo
Common goodp
(Natural) market powerq
Principal-Agent
problem
Adverse selectionx,
Moral hazardx
Efficiency wages
Winner-take-allB
Baumol’s Cost
DiseaseB
Differential budget
constraintsC
Differential budget
constraintsC
Differential budget
constraintsC
Diminishing marginal utilityD
(Employer) market powerF
Positional externality
E
business cycle,
bubbles & panics,de- &
inflation
under-saving (CPR)
+ adjustment costs+ within-party distributive effects
- factor mobility
+ adjustment costs+ within-party distributive effects
- factor mobility
+ adjustment costs+ within-party distributive effects
- factor mobility
+ adjustment costs+ within-party distributive effects
- factor mobility
+ adjustment costs+ within-party distributive effects
- factor mobility
Marketg
- Property rightss
Regulated private
provision, antitrustt
- Mandatory insurancey -
Price controlsGPrice controlsGPrice controlsGPrice controlsGPrice controlsG Antitrust, right 2
strike, EPL,codeter-
minationG
-EPL
(employment protection legislation)
mandatory pensions
factor price
flexibility-- - -- -
State
h
- Property rightss
Regulated private
provision, antitrustt
- Mandatory insurancey - Quotas
(e.g. affirmative
action)H
Quotas (e.g.
affirmative action)H
- --
Antitrust, right 2
strike, EPL,codeter-
minationG
-EPL
(employment protection legislation)
mandatory pensions
factor price
flexibility-- - -- -
State
h
Public pro-
visionr
Pigou-vian taxs
Public provision
for feet
Redistri-bution
Public benefitsy
Progressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfers
Fiscal stimulus
public investment, encourage
saving
transferstransferstransferstransferstransfers
State
h
Public pro-
visionr
Pigou-vian taxs
Public provision
for feet
Redistri-bution
Public benefitsy
Progressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfersProgressive taxationspending & transfers
Fiscal stimulus
public investment, encourage
saving industrial policy
industrial policy
structural policy
State
h
[Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu] [Price stabilityu] [Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu][Price stabilityu] Monetary
stimulus[Price
stabilityu] - - -- -
State
h
EfficiencyᵇEfficiencyᵇEfficiencyᵇ Risk Poolᴶ Equity cEquity cEquity cEquity cEquity cEquity cEquity cEquity c ConsistencydConsistencyd Convergence eConvergence eConvergence eConvergence eConvergence e
Ends of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human InstitutionsEnds of Enlightened Human Institutions
Figure 2: Means and Ends of the Mixed Economy (Director’s Cut)
Allokation & Effizienz Verteilung Stabilisierung
MarktMarktgleichgewicht ist pareto-optimal
(über eine gegebene (ex-ante) Verteilung)(unter heroischen Annahmen)
Marktversagen Allmendegüter, Risikopools, …
Winner-take-all, monopsistische Arbeitgeber …
KonjunkturzyklenHandelsbilanz-
ungleichgewichte
Intakte Mischwirtschaft
Regulierung Steuern
Regulierung Steuern
Geldpolitik Steuern
Figure 1: Means and Ends of the Mixed Economy
Why does the mixed economy matter to the welfare state? (p. 86ff)
- ... because it engages the complexity of a modern economy: markets react to interventions (e.g. deadweight-losses)
- ... because it denaturalizes market allocations: whatever allocative results welfare states redress, are already contingent on social institutions and ex-ante distributions (e.g. “poor relief” vs. winner-take-all, efficiency wages, monopsony employers)
- ... because it guides us to social consequences: (welfare) states are better, and in specific ways, at some things than others (e.g. public utilities, free family health care; efficiency and equity)
How does this differ from other formulations? (p. 89ff)
- ... there are better (and worse) tradeoffs between efficiency, equity and sustainability in designing mixed economies. Marginal costs differ! (e.g. NIT vs. minimum wage)
- ... it’s not full employment (Keynesian, “demand-side”) vs. growth (neoliberalism, “supply-side”) (e.g. Offe 2003). ‣ Keynesians: there is not always underconsumption ‣Neoliberals: not all deregulation stimulates growth. ‣Growth: in GDP (cash flow) measures activity, not income (earnings and losses), let alone assets (balance sheet) ‣Full employment: is necessary but not sufficient condition for welfare (e.g. depleted commons, winner-take-all)
Ordnungspolitik (Regulatory Policy)
... braucht:
- Gewaltmonopol (sonst Korruption)
- Rechtsstaatlichkeit (sonst Willkür)
- Kongruenz, nicht Subsidiarität (sonst Arbitrage) (Sinn 2011)
Fiskalpolitik
Geldpolitik (Monetary Policy)
... braucht:
- Kongruenz (sonst Steuerwettbewerb)
- Minimale Marktverzerrung (sonst Wachstumsversluste)
- Beliebige Lastenverteilung zwischen natürlichen Personen
- u.v.a.m. (Held 201x)
... braucht:
- Synchrone Konjunkturzyklen
- Totale Mobilität von Arbeit, Kapital
- Flexible Preise, Löhne
- oder Fiskaltransfers! (Mundell 1961)
Allokation & Effizienz Verteilung Stabilisierung
MarktMarktgleichgewicht ist pareto-optimal
(über eine gegebene (ex-ante) Verteilung)(unter heroischen Annahmen)
Marktversagen Allmendegüter, Risikopools, …
Winner-take-all, monopsistische Arbeitgeber …
KonjunkturzyklenHandelsbilanz-
ungleichgewichte
Intakte Mischwirtschaft
Regulierung Steuern
Regulierung Steuern
Geldpolitik Steuern
EU Regulierung Steuern
Regulierung Steuern
Geldpolitik?Steuern
Figure 1: Means and Ends of the Mixed Economy
Table 9: Tax Competition in the EU, Stylized as a Prisoner’s Dilemma
Home
Low Tax High Tax
Rest of World
Low Tax3 0
3 10
High Tax10 7
0 7
Home and Rest of World are the only two countries in the union. They set their tax rates eitherhigh, or low. Capital and other mobile factors flow to whichever country has the lower tax rate.Payo↵s are state revenues.
up a lot of new escape routes, especially for newly mobile capital, and, toa lesser extent, high-skilled labor: they can relocate their economic activityto wherever the tax burden will be lowest. This causes welfare-depressingdistortions in the high-tax economy: rather than face a now voluntary tax,these pareto-optimizing exchanges will not be made at all, and instead hap-pen elsewhere. For example, a rich entrepreneur otherwise willing to opena new factory in high income-tax Germany, may, faced with the new alter-native of building the same facility in a low-tax location, forego his originalplan. Germany unambiguously looses welfare, both because the investmentis not made, and also because it does not even generate any fiscal revenue.
Faced with these dynamics, governments will, again rightly so, shift theirtaxation to bases that are less prone to DWLs, or equivalently, bases thatare relatively less mobile. Relatively less mobile bases in the EU will beconsumption and labor incomes, because consumers and workers cannoteasily do their shopping and working in another country.
Other — partly dysfunctional — taxes traditionally used to raise revenuefor mixed economies will be rolled back or falter altogether. This appliesespecially to — anyway defunct — national CITs that large corporationscan often evade easily, in part because nailing down the locale of any partic-ular increment of income of a multinational firm will always be conceptuallydi�cult. For example, the German holding of Deutsche Bank AG can eas-ily reassign a particular income stream to a Luxembourg-based subsidiary,arguing that a crucial business process occurred there. Tax administrationswill always, and necessarily, be unable to argue where any particular valuewas created (Ganghof 2006, Ganghof and Genschel N.d., Ganghof and Gen-schel 2007: 5). Similarly, higher brackets of progressive PIT will also causelarge DWLs or, more likely and wisely, disappear, as high-income individu-als change residence or citizenship, o↵shore their income-generation to othercountries, or at least shelter it in foreign corporations no longer a↵ected by
114
Figure 3: Tax Competition as a PD
Sfb 597 „Staatlichkeit im Wandel“ - „Transformations of the State“ (WP 80)
- 11 -
tions. From the 1980s onwards payroll taxes became the dominant form of public reve-nues, but indirect taxes in the form of VAT (value-added tax) have caught up in recent years. For comparative reasons I have plotted the tax mix of the UK on the right hand side of the figure. In the UK the income tax ratio hit its all-time high already in the mid 1970s, became briefly more important in the early Thatcher years, and then went back on decline until the mid 1990s. Only from then on income tax revenues have recovered slightly. Indirect tax revenues have increased over the whole period. Only during the labour governments of the late 60s and 70s payroll taxation was of some importance.
Figure 2 Tax Mix of Germany and the UK after World War II
810
1214
16
1960 1970 1980 1990 2000
GER
Income Tax to GDP Payroll Tax to GDPIndirect Tax to GDP
year
Graphs by country_n
510
15
1970 1980 1990 2000
UKD
Income Tax to GDP Payroll Tax to GDPIndirect Tax to GDP
year
Graphs by country_n
In both countries one sees influences of business cycles (inflation and growth) in the growth of income tax. One can also see long term changes that are due to political rea-sons that shifted the tax mix away from progression. Of course, a higher proportion of income taxes does not automatically lead to higher levels of progressivity. Yet different measures of tax-based redistribution move broadly in line with ratios in both countries. Using both statutory marginal rates and coefficients of ’residual progression’ Corneo (2005) shows for Germany that from 1958 till the mid 1980s tax progression was on the rise for middle and high incomes, whereas it has decreased from then on. Very low in-comes of half the average GDP per capita income have seen a remarkable increase in marginal rates so that the overall progressivity of highest and lowest income brackets has been reduced since the mid 1970s. It is therefore safe to argue that across time the
Kemmerling 1999Figure 4: Tax Base as Share of GDP
Structural Unemployment
Structural Underfunding
real dissavings
underprovision of public goodsconstrained
redistribution high effective labor
price floors
The Twin Crisis of the Late Welfare State
poor growth
low
productivities
great needs for transfers
Figure 5: The Twin Crisis of the Late Welfare State
Public Consumption
State Market
Public Investment
Private Consumption
Private Investment
Taxes (on consumption, labor)
Command Exchange
Saving
Consumption
Taxes (on assets)
In-kind Transfers, P
ublic Goods,
Natural Monopolies
Cash Transfers & Stimulus
Public Goods, Natural Monopolies,
Sovereign Wealth
Stimulus & Industrial Policy
Demand
Supply
InterestRate
Taxes (on income)
Figure 6: Tradeoffs of the Mixed Economy
Equity
Efficiency
Positive Integration
Negative Integration
Autarky
Mode of Integration
Figure 7: Negative Integration as a PPF
“The Congress shall have Power [...] to regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes;”
- US Constitution, Article I, Section 8, Clause 3 (Commerce Clause)
“(...) das die Übernahme der Schulden eines Staates durch den Bund, und umgekehrt, eine Maßnahme von guter Politik und substantieller Gerechtigkeit sei.”
-- Alexander Hamilton, 1790
Frankreich Bulgarien
Pro-Kopf Einkommen (2010 PPP, IWF) $44,747 $6334
Arbeits-produktivität (2010, indiziert auf
EU-25 Schnitt)116 41.3
Figure 8: Prosperity and Productivity across the EU
Finanzkrisen als Latente (Dys?)funktionen (Merton 1936)
(Süchtig machende) (Placebo) Schmerzmittel:
1. Reale Einsparungen
2. Kreditblasen (Stiglitz 2010) 3. Asset-Blasen
4. “Eingebaute” Inflation (Gordon 1988 / Philips Curve)
∆ Wealth∆ Wealth∆ Wealth = IncomeIncome − ConsumptionConsumption↑ - ↑ ↑ ↓ (+)↑ (-)↓
Ownership
House-holds
Build house Take out mortgageEarn more
(wages, profits)
or
Earn less(wages, profits)
or Consume more(private goods)
Consume less(private goods)
Ownership
House-holds Pay back debt Sell house
Earn more(wages, profits)
or
Earn less(wages, profits)
or Consume more(private goods)
Consume less(private goods)
Ownership
House-holds
Going to college Student loanLess taxes
(lower or more regressive schedule)
More taxes(higher or more
progressive schedule)
Consume more(private goods)
Consume less(private goods)
Ownership
Firms Retained earnings Dividend
Less taxes(lower or more
regressive schedule)
More taxes(higher or more
progressive schedule)
Consume more(private goods)
Consume less(private goods)
Ownership
Govern-ment
Build levee Burn carbonᴮ
Collect more(taxes, revenues)
Collect less(taxes, revenues)
Consume more(public, common
goods, etc.)
Consume less(public, common
goods, etc.)
Ownership
Govern-ment
Do basic research Sell government enterprise
Collect more(taxes, revenues)
Collect less(taxes, revenues)
Consume more(public, common
goods, etc.)
Consume less(public, common
goods, etc.)
Ownership
Govern-ment
Build SWFᴬ Issue bonds
Collect more(taxes, revenues)
Collect less(taxes, revenues)
Consume more(public, common
goods, etc.)
Consume less(public, common
goods, etc.)
Ownership
Govern-ment
Pension reserves Neglect roads
Collect more(taxes, revenues)
Collect less(taxes, revenues)
Consume more(public, common
goods, etc.)
Consume less(public, common
goods, etc.)
Savings - Dissavings Growth Decline Affluence Austerity
Figure 9: Aggregate Haig-Simons Identity of Income
Resources / Factors of Production(Land, Labor, Capital)
Output (O)(Goods, Services)
Income (Y) / Factor Earnings(Rents, Wages, Dividends)
Expenditure (E)
Government Sector
Financial Sector
Overseas Sector
Leakages
Injections
Net Taxation (T)(Transfers - Taxes)
Imports (M)
Net Investment (I)(Divestment - Investment)
Exports (X)
Net Saving (S)(Saving - Dissaving)
Households Firms
Government Spending (G)
Budget Surplus
BudgetDeficit
Trade Deficit
TradeDeficit
CreditBoom
CreditBust
Figure 10: Circular Flow in the Economy
Capital Account = Current Account
Central Bank Foreign
Reserves+ Net Ownership of Foreign Assets = Factor Incomes + Balance of Trade
Investments Abroad - Loans from
Abroad = (Foreign Earnings - Foreign
Payments) + (Exports - Imports)
O w n e r s h i p
House- holds -
Buying shares in French
agribusiness
Taking out mortgage from Icelandic bank
Dividends on French
agribusiness shares
Interest payment to Icelandic
mortgage bank
Cuckoo clocks to USA
Olive oil from Greece
Firms -
Foreign Direct Investment (FDI)
in Romanian plant
US-owned corporate paper in
German firm
Returns from foreign
subsidiaries
Dividends to foreign owners
Capacitative touchscreens
to USA
Diesel engine particle filters from France
Govern-ment - Buy Zimbabwian
bondSell German bond to British holders
Interest payments on
German-owned Zimbabwian
bonds
Interest payments to
British holders of German
bonds
Used tanks to Turkey
Commuter trains from
Italy
Capital Outflow Capital Inflow Recipient Trade Surplus Trade Deficit
Figure 11: Capital and Current Account
saving always means to build more things that last longer and/or thatwe will consume later, instead of things that last a short while andthat we consume now.
Of course, any one investment will ultimately be consumed or depre-ciate away. And we can save too much, when capital goods depreciatefaster and have such decreased marginal returns that they outstripour current utility from the same resources (This follows from Solow(1956) theory of growth, p. 48).
But while that means we should not save endless amounts at any pointin time, it does not mean that at some point in time, we should saveno more. There is no economic reason why we could not roll over(limited) savings to our children in perpetuity.
2. Dissaving 6= Debt = Deposits 6= Saving. Dissavings are not the sameas debt. Dissaving is a decrease in net worth of households, firms andeconomies: we diminish some durable thing in its value. Conversely,saving is an increase in net worth: we add value to some durable thing.
In contrast, going into debt does not a↵ect net worth of households,firms or government: we temporarily gain access to an already existingvaluable thing (construction man-hours), potentially transform it intosomething else (a house) and return the valuable thing later (withinterest). Conversely, putting in a deposit (or other credit) also doesnot a↵ect net worth: we temporarily grant access to an already existingvaluable thing to others, for an interest.
Table 8: Debt and Credit in the Closed Economy
Households Government
Income� Spending < 0 Revenue� Spending < 0P
private debt public debt =
(e.g. credit card, mortgage) (e.g. government bonds) All Debt
Income� Spending > 0 Revenue� Spending > 0P
=
private credit public credit =
(e.g. deposits, bonds) (e.g. reserves, sovereign wealth) All Credit
P= 0
Trivially, public and private debt will always equal public and private
83
Figure 12: Debt and Credit in the Closed Economy
Ökonomische Schlussfolgerungen
1. Effiziente und faire wirtschaftliche Integration braucht immer eine intakte Mischökonomie mit unionsweiten Steuern: sonst steigende Arbeitslosigkeit, Ungleichheit,
2. Das Wohlstands- und Produktivitätsniveau in der EU machen einheitliche Steuersätze einstweilen unmöglich; wir brauchen eine Transferunion.
3. Reales Entsparen, Kredit oder Asset-Blasen und Inflation können Krisen verstecken, verschieben und verschlimmern. Nichts ist gut, weil nominelle Variablen wie BSP oder Beschäftigung gut aussehen.
4. Kapitalmärkte mögen bessere Regulierung (und kleinere Firmen!) brauchen; Finanzkrisen sind aber auch Epiphänomene.
Politische Schlussfolgerungen
1. Die Nutzen, Kosten und Bedingungen der wirtschaftlichen Integration müssen umfassend erklärt werden. Zur wirtschaftlichen Integration und dem Abschied von imaginierten Gemeinschaften wie dem Nationalstaat gibt es keine attraktive Alternative.
2. Vollbeschäftigung und BSP taugen beide nicht als hinreichende Politikziele.
3. Vielleicht geht wirtschaftlicher Integration Tiefe vor Breite.
4. Banken- und Finanzkrise waren (sind) auch Symptome.
5. Nachfragesteuerung depolitisieren (Inflation trifft Mittelschicht!).
“Aber wer kann schon sagen, wieviel zu ertragen ist, oder wohin sich die Menschen wenden werden, als letzte Flucht aus ihrem Unglück?
-- John Maynard Keynes, 1919
Athen, 2012
Universität Bremen
www.maxheld.de
Abstract
Welfare states are best understood as mixed economies, where free market exchange is supplemented by planned state command in the service of equity, efficiency, or both. In well-designed mixed economies, market and plan co-exist with minimal mutual distortions, and democratic sovereigns can trade off efficiency and equity at relatively small marginal cost. Intact mixed economies rely on a set of regulatory, monetary and fiscal tools that operate on the same scale as markets. In negative integration, markets expand to larger scale, but states remain organized at lower levels, crippling the command tools of the mixed economy. As a result, democratic sovereigns can no longer take primacy over the economy and any remaining welfare states will be inefficient, inequitable, unsustainable or all. European integration is negative integration, and much of the 2010ff Euro-crises and the demise of European welfare states can be fruitfully analyzed as defunct mixed economies. CEEC, in particular, followed a bad route to liberalization and built largely dysfunctional welfare states, because they did not, and could not, engage the trade-offs and contradictions of mixed economies in the context of negative integration. Some of the existing literature on CEEC welfare and retrenchment fails to acknowledge the true constraints and alternatives of a mixed economy, and thereby fails to criticize and explain the societal and political choice of negative integration. The current acquis threatens welfare, and, ultimately democracy and regional integration. If the EU is to succeed, more economic integration must again always beget more political integration.
Mehr auf: https://github.com/maxheld83/hamilton
TINA (p. 137 ff)
“There is (...) no alternative.”
-- Margaret Thatcher (London 1980)
Without the mixed economy, fall for TINA: we assume alternatives that aren’t, and forget alternatives that are.
- Kovacs (2003: 12) “Eastern Europe may be unlucky (...)e if it is confined to imitation” because these (Western) welfare regimes “will probably not produce the same performance levels as they do today”.
- Scharpf (1997: 26) “the economically less developed MS simply could not afford (...) the same level of welfare (...) (as) the highly developed MS”. Harmonization is “probably impossible”.
- Scharpf (1997: 29) “Normative (sic!) political theory as well as political practice must come to grips with the conditions (sic!) of ‘democracy without omnipotence’.”
Who Should Manage it?Who Should Manage it?Public (State) Private (Market, Family)
When to
Save?
Pre-fundedPre-funded Sovereign Wealth Private pensionLife insurance (etc.) Current workersCurrent workersCurrent workersCurrent workers
IncidenceWhen
to Save?
Post-fundedPost-funded PAYGO Family, Corporate Pension Plans Future workersFuture workersFuture workersFuture workers
Incidence
What to Invest
in?
Productivity
Human Capital Education Quality Children
ProductivismProductivismProductivismProductivism
PolicyWhat to Invest
in?
ProductivityPhysical Capital Sovereign Wealth Private Investment
ProductivismProductivismProductivismProductivism
PolicyWhat to Invest
in?
WorkforceWorkforce Family Policy Having Children NativismNativismNativismNativism
Policy
Where to
Invest?
Abroad and at Home(under open economy)Abroad and at Home
(under open economy) Sovereign Wealth Fund International Financial Markets
Now: Trad
Now:Trade
Surplus
Now:Trade
Surplus
Future:Trade Deficit
Macro-Economy
Where to
Invest? At Home(under autarky)
At Home(under autarky) Capital Deepening Domestic Financial Markets
Now: Positive Savings
Rate
Now: Positive Savings
Rate
Future:Negative Savings
Rate
Future:Negative Savings
Rate
Macro-Economy
Without the mixed economy, fall for TINA: we assume alternatives that aren’t, and forget alternatives that are.
- Cerami (2009) sees non-alternatives in pensions: ‣ It’s PAYGO vs. funded. ‣ PAYGO is stable, but has vicious cycle. ‣ Funded is risky, but solves demographic problem, but double-charges the young. explain, not what we want to explain things with.
- Cerami (2009) ignores alternatives: ‣ Who pays, rich or poor? ‣ How much do we save for our children?
Pangloss (p. 148 ff)
“And they who assert that everything is right, do not express themselves correctly; they should say that everything is best.”
-- Voltaire: Candide (1759)
Without the mixed economy, fall for Pangloss: we assume that the defunct mixed economy is collateral damage.
- Theory of Second Best (Lancaster 1956) (mis-)applied to government and democracy. ‣ by definition, if the means to change the market outcomes are corrupted, and therefore unacceptable, whichever results occur must be the best of all worlds. ‣ Government failure -- it it exists -- is what we want to explain, not what we explain things with.
- Moravcsik (2002: 618): “No responsible analyst believes that current individual welfare entitlements can be maintained (...). In this context, the neoliberal bias of the EU, if it exists, is justified by the social welfarist bias of current national policies (...).”
Without the mixed economy, fall for Pangloss when we ill-measure welfare state en- or retrenchment. We ask weak questions.
- Swank (2005) ‣ Asks: has income replacement shrunk? (it has not) ‣ Asks not: are there bubbles, unemployment, dissaving.
- Pierson (1996: 174): Nondecisions “generally favor the welfare state”. ‣Asks not: can welfare states still react? (e.g. inequality, tax base) (Genschel 2005: 53)
Newspeak (p. 158 ff)
“But if thought corrupts language, language can also corrupt thought. A bad usage can spread by tradition and imitation even among people who should and do know better.”
-- George Orwell: 1984 (1946)
OMC, Governance
“OMC”, “Governance”
Bystanders (p. 162 ff)
“If there is a hard, high wall and an egg that breaks against it, no matter how right the wall and how wrong the egg, I will stand on the side of the egg.”
-- Haruki Murakami (Jerusalem, 2009)
How does this differ from decommodification? (p. 92ff)
- ... there is always interaction. You can’t take people off markets (e.g. moral hazard in disability)
- ... is description, not prescription (Esping-Andersen 1990) ‣Partaking in the market is more than just for money. ‣Decommodification is a last-resort tool (cf. NIT) ‣Decommodification does not have a market-failure justification.
- ... is radical, but limited (inequality, failure) ‣ ... is the explanandum, not the explanans; what we want to explain, not what we want to explain things with.