Here are some things we've seen recently:
- Andy Haldane says shareholder capitalism is too short-termist, without asking whether it is possible to change this, or whether short-termism might in fact be a rational response to massive uncertainty about technical change and creative destruction.
- There's a warning that the rising minimum wage might cause a "catastrophic failure" in home care. Apparently, higher wages have a cost: who'd have guessed?
- Alan Milburn seems scandalized by the fact social mobility is blocked by parents' urge to help their kids.
There's a common theme here. It's centrist utopianism - the idea that moderate and feasible tweaks within capitalism can generate big improvements. Haldane seems to think we could see much higher investment if only capitalism could be reformed*; minimum wage advocates might be underplaying the costs of the policy; and supporters of social mobility fail to appreciate that human nature is itself a massive obstacle to greater equality of opportunity.
Here are some other examples of centrist utopianism:
- The idea that macroeconomic policy can stabilize economies. This runs into the problem that recessions are inherently unpredictable and so policy cannot be changed in advance of downturns; the Bank of England didn't begin QE until 12 months into the recession. It also assumes that governments would want to stabilize the economy if only they could. But as Kalecki famously pointed out, this is dubious.
- The idea that structural reforms can quickly and significantly increase growth. This is in fact pretty much impossible.
- The pretty much unquestioned faith in managerialism and command and control techniques; the response to pretty much any organizational failure is a demand for "better leadership". This ignores the possibilities that "leaders" lack the knowledge and rationality to control complex organizations, or that such leadership has costs in terms of facilitating rent-seeking and demotivating employees. This ideology isn't confined to organizations. For a long time, there's been a divide in Labour between those who think change can be achieved merely by winning elections, and others who think there must be broader social and cultural change.
- The notion that public sector bodies, including the BBC, can increase efficiency by shedding waste. This fails to appreciate a basic lesson of public choice - that bureaucrats look after themselves, and so wasteful layers of management can become entrenched.
I say all this as a counterweight to a longstanding prejudice - that centrists and moderates are realistic and hard-headed whilst we leftists are utopian dreamers. Of course, this accusation applies to some on the left - anything is true of someone - but for me the opposite is the case. I'm a Marxist because I'm a pessimist. It is those who think that (actually-existing) capitalism is easily reformable so that inefficiencies and injustices can be eliminated who seem to me to be the dreamers.
* I might be doing him a dis-service. Maybe he believes that low investment is an ineradicable feature of capitalism.
Another thing. You might object that capitalism has seen huge improvements in workers' well-being. However, just because something has occurred in the past doesn't mean it will continue to occur. Maybe reformers have picked the low-hanging fruits. And if we are in secular stagnation, then the economy becomes a zero-sum game - which reinforces my pessimism.