Tag Archives: economic crisis

Austerity and the Double-Movement

After the French elected Socialist Francois Hollande in a rebuke of austerity policies gripping Europe, news headlines issued reports of worried markets.  The fear, among some, is that the new president would act in such a way, or more precisely that the public was acting in such a way that, would spook markets.  Some economists, most notably Princeton professor and Nobel prize winner Paul Krugman, have argued against austerity in favor of government stimulus to push economic demand and growth.  Krugman has made frequent reference to the Great Depression-era economic theories of John Maynard Keynes.  While Keynes is important here, a less noted theorist – Karl Polanyi, is, in my view, more apt to the particular electoral impulses unfolding across Europe. (more…)

Facing More with Less: Thinking about School Budgets

There can be little doubt that because of the current economic conditions, a large part of society has undergone considerable strain. Whether discussing unemployment rates, downsizing, closed up businesses, or market trends, it seems that little has been left unaffected by these financial times. Of concern for this post is how schools, specifically secondary schools, have had to adapt to and deal with the economic state. Often making top news reports on major broadcasting stations or making the front-page of newspaper outlets, it is not uncommon to hear of another school having to face financial cutbacks and crisis. It is the budgetary tightening within schools that this post considers; more specifically, when facing budget cuts, what policies and programs are left in place and which are discarded.

A mentor and I are currently writing about the financial context of certain school practices and policies. When discussing school budgets, the primary concern is with which programs – on a continuum of being financed – receive budgeted funding given both the economic situation of the school and, more broadly, the larger economy? Stated another way, are there programs and policies that remain funded while others are cut, and if so, what is the reasoning or rational behind how budgeted funds are distributed? (more…)

Shifting Migration Patterns in a Changing Economic Climate

Greeks-immigrating-to-USA-1910

by smteixeirapoit

In the past, many immigrants traveled to the United States because they hoped to achieve upward mobility. In the current economic climate, many immigrants are not upwardly mobile. Some immigrants are unable to secure employment and other foreign workers are facing a backlash. For the first time, the United States is experiencing a decline in immigration. Many immigrants are avoiding immigrating to the United States in the first place or are deciding to leave the United States for their home countries. Additionally, several countries, such as Spain and Japan, are increasing restrictions on immigrants entering the countries or are providing incentives for immigrants to leave the countries.

Economists characterize immigrants contributing to the low-wage labor force in developed countries as a win-win situation, whereby immigrants receive employment opportunities and employers obtain increased profits. Economists are examining whether shifting migration trends challenge globalization. These migration trends may reduce competition for employment and pressure on social services in developed countries. However, these trends may equate to declining profits and rising inflation. Whereas economists contend that globalization is transferring from being a win-win to a win-lose situation, many global social change scholars emphasize that globalization has never been and will never be a win-win situation. Although absolute improvements have been made under globalization, relative inequality exists and persists.

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Square-eye“Immigration” By Hans Van Amersfoort

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George Ritzer Guest Post: Are Today’s Globalized Cathedrals of Consumption Tomorrow’s Global Dinosaurs?

By: George Ritzer

Distinguished University Professor, University of Maryland

bloomingtonmn_mallofamericainterior1

A decade ago I wrote a book dealing with what I called the “cathedrals of consumption”. These are consumption settings that had, in the main, come into existence in the United States in the post-WWII era. Of particular interest were the most grandiose of these consumption settings including major indoor shopping malls, mega-malls (e.g. Mall of America), theme parks (especially Disneyland and Disney World), cruise ships, and above all the themed casino-hotels that came to dominate the Las Vegas Strip. In the last several decades these cathedrals of consumption became increasingly ubiquitous and predominant not only throughout the United States, but also globally. This is particularly clear in and around the booming economies of China and the Arabian Peninsula, but similar developments are taking place in many other places in the world (e.g. Singapore, Philippines, etc.). Dubai began creating its three Palm Islands to be dominated by mega-hotels like the Atlantis (a clone of a hotel of the same name in the Bahamas), the first of nearly a dozen hotel-condominiums to be built on Palm Jumeirah, the first of the islands to be completed. Dubai will also have many shopping malls associated with this development; there is, as yet, no plan, to build a Disneyland there.

This essay is devoted to the fate of the cathedrals of consumption globally in the “Great Recession” that began in late 2007. It is difficult to feel as much sympathy for the plight of hyperconsumers and the grand cathedrals of consumption as, for example, those who have lost their jobs and seen their pension funds decline precipitously. Nonetheless, there is an important story to be told here and it is one that will have negative implications for large numbers of people, including more sympathetic figures such as those throughout the world who are losing, and will lose, their jobs (in construction, as dealers, as hotel workers, etc.) associated in various ways with hyperconsumption and the cathedrals of consumption.

The grand narrative here involves a series of changes in consumption that began mainly in the United States after the Second World War and gained increasing momentum over the next 60-plus years. Over this period of time these changes became increasingly global. When the window of opportunity for these developments slammed shut beginning in late 2007, many projects were stopped in their tracks and the trend toward increasing hyperconsumption and ever more, and more spectacular, cathedrals of consumption was aborted. In terms of the cathedrals of consumption, while this was true of some ongoing projects in the U.S., it is especially true in other places in the world which are being especially hard hit by the current recession. The cathedrals of consumption that seemed to so many to be a bright symbol of the future of the global economy in general, and consumption more particularly, now increasingly seem like dinosaurs, relics from a previous epoch that is not likely to return, at least in anything approaching the form it reached in the first decade of the 21st century.

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A "New" Economics 101

 

1907_panic1by theoryforthemasses

In a recent New York Times op-ed, columnist David Brooks questions whether the old, “rational,” Keynesian model of economics is truly useful for trying to understand the current economic crisis. He suggests that while economists have traditionally built elegant economic models of efficient markets based on rational actors, the process of making economic decisions is actually much more complex. Brooks explains that these complexities, which are informed by actors’ various strategies, memories, and intuitions, are what influences economic decisions and ultimately markets. In other words, markets are not simply efficient manifestations of reasonable actions; they are confluences of decisions made by individuals who are deeply influenced by their historical, social, political, and cultural contexts. Sociologist Mark Granovetter has drawn from the ideas of economist Karl Polanyi in order to elaborate this very point.

Granovetter has developed a “new economic sociology,” a theoretical framework that suggests that interpretation and social interaction are at the crux of economic action. He sheds the view that economic markets are increasingly separate from the individuals who constitute them. Rather, he argues that economies are “embedded” in ongoing social interactions among individual actors. Economic action is therefore not just a matter of individual, rational decision-making; instead it is patterned along elaborate social networks and influenced by various culturally-defined goals and priorities. Perhaps once we begin to let go of our old assumptions about human nature, specifically that “man” is a rational barterer of economic goods and services, we may be better able to understand the complex causes and consequences of economic collapses, including the one currently in our midst.

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square-eye21E. Mingione and S. Ghezzi on social embeddedness