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Home Market Research Economy

Evaluating We Have Never Been Woke, Part 3: Economics

by TheAdviserMagazine
3 weeks ago
in Economy
Reading Time: 10 mins read
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Evaluating We Have Never Been Woke, Part 3: Economics
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In his book We Have Never Been Woke, Musa al-Gharbi examines the worldview of symbolic capitalists in great detail. Much of what he describes looks very familiar to me (although the fact that I see the behavior al-Gharbi describes so regularly is itself something I consider as having very little weight as evidence — I’ll describe why in a different post). But there are some points in his analysis that didn’t quite fit, as far as I can tell.

For example, consider how al-Gharbi described the rise of the symbolic capitalists, and the worldview they embraced as they took the reins of social power:

Secularizing the social gospel movement, they promised to help America transcend its divides, redeem its soul, and experience unprecedented peace and prosperity by leveraging science and reason to maximize human flourishing in a way that laissez-faire capitalism never could. They promised a world where robber barons would be restrained by technocrats, where corruption, nepotism, exploitation, and unjust discrimination would be replaced by meritocracy and professionalization. The poor and the unfit would be cared for and gradually eliminated through a combination of aid, education programs, expanded rules and regulations (and intensified enforcement), and eugenics programs. Political partisanship, ethnic and religious conflict, and other forms of tribalistic struggles would be settled by objective and disinterested experts committed to the greater good. Class struggle would be eliminated, not because inequality was vanquished, but because people across the social strata would be made to see that the prosperity and economic dynamism unleashed by free markets could benefit everyone—so long as the wealthy and powerful could be persuaded to entrust a share of their wealth and authority to symbolic capitalists to manage the economy and society writ large.

This, al-Gharbi tells us, has continued to be basically the framework and ideology supported by symbolic capitalists (minus the support for eugenics, which was thankfully repudiated). Overall, al-Gharbi tells us, symbolic capitalists want social welfare programs, redistribution, increased and more strongly enforced economic regulation in order to “maximize human flourishing in a way that laissez-faire capitalism never could,” technocratic control of economic outcomes, legally enforced restrictions and barriers to entry for a wide range of careers, and to “manage the economy and society writ large.”

Yet later in his work, al-Gharbi also tells us that symbolic capitalists “skew culturally and symbolically to the left but favor free markets.” Not wanting to go too deeply down the rabbit hole of arguing by definition, but there seems to be a strong disconnect here — how can someone favor top-down technocratic control of the economy, but also favor free markets? Granted, in his last line of the description, al-Gharbi says symbolic capitalists argue the “prosperity and economic dynamism unleashed by free markets could benefit everyone—so long as the wealthy and powerful could be persuaded to entrust a share of their wealth and authority to symbolic capitalists to manage the economy and society writ large.” But to my eye, saying free markets will benefit everyone as long as technocrats control the economy writ large is tantamount to saying free markets will benefit everyone as long as we abandon free markets. I confess to being unable to provide a flawless, exclusively correct analytic definition of what “free market” means (see Matt Zwolinski on this point here), but I have a hard time squaring the circle of “favoring free markets” with favoring all the various forms of top-down, technocratic control of market activity symbolic capitalists advocate.

I mentioned in my last post that I at least got an impression that al-Gharbi favors increasing the minimum wage, even though he surely doesn’t advocate this policy for the reasons initially intended by progressives. Part of that impression came from passages like this:

[Symbolic capitalists] prescriptions for addressing unfortunate market externalities vary systemically from everyone else’s too. Highly educated Americans, for example, tend to prioritize redistributive policies to address inequalities (taxes and transfers) over predistributive approaches (e.g., high wages, robust benefits, and job protections that render reallocation less necessary.)

To be clear, al-Gharbi isn’t explicitly saying he favors the “predistributive” approach, so I can only report my impression — I may very well be wrong. Still, I think this difference is somewhat overstated.

In support of this claim, al-Gharbi cites the paper Compensate the Losers: Economic Policy and Partisan Realignment in the US. While there is a negative association between education and support for predistributive economic policies (defined as increased minimum wages, stronger unions, job programs, and economic protectionism), that trend has been weakening over time with regard to minimum wages and labor unions from the second “Awokening” forward.  By contrast, the negative association between education and support for protectionism has only gotten stronger over time, while the association between education and support for redistribution is very weak and not always positive. Figure A.1 (on page 58 of Compensate the Losers) shows the association for various redistributive measures, and the coefficients are all very close to zero — and in some cases, slightly negative.

Even more noteworthy is what we see on Figure A.13 (page 70). In his book, al-Gharbi criticizes the symbolic capitalists support for policies like affirmative action, suggesting that this policy has been a tool of elites to secure their own advantage, while failing to benefit the genuinely disadvantaged:

These beneficiaries also tend to be already affluent compared with most other Black Americans. These patterns are especially pronounced at elite schools (and by proxy, elite symbolic professional institutions). Critically, this “elite capture” is hardly unique to Black people. Across ethnicities, comparative studies in the United States and abroad have found that affirmative action programs tend to primarily benefit already financially well-off members of the target groups.

But in Figure A.13, we see there is a strong negative association between support for affirmative action and years of education. The more highly educated someone is, the less likely they are to support affirmative action policies. This runs contrary to the usual association al-Gharbi makes of woke policies being disproportionately held by highly educated elites.

It’s also not clear to me that highly educated Americans being more likely to oppose the minimum wage and more supportive of redistribution fits well with al-Gharbi’s general thesis. One of the causes of “Awokenings,” al-Gharbi says, is the desire of elites or elite-aspirants to secure their situation by embracing policies that shut out potential rivals. But an increase in minimum wages doesn’t seem like a good way for elites to shield themselves from competition the same way that, say, licensing, educational, and certification requirements would. As al-Gharbi says elsewhere, “The amount of money symbolic capitalists take home every year is higher than for virtually anyone else in society,” and even “symbolic capitalists on the low end of the spectrum still tend to earn about as much or more than they would if they pursued work outside the symbolic professions.”

Minimum wages would be non-binding for symbolic capitalists — they would neither gain additional income nor risk being priced out of their jobs by the higher wages. Higher taxes and redistributive transfers, however, would seem to be against the self-interest of symbolic capitalists. Given that these are disproportionately high-income people, they would also be the ones who would have to foot the bill for redistribution, rather than benefitting from it. So the idea that symbolic capitalists support redistribution over predistribution as a means to protect their own status doesn’t strike me as compelling.

There is one possible exception. There are situations where al-Gharbi describes some symbolic capitalists who work for very low or no wages, particularly when attempting to break into journalism, and that this arrangement can actually be beneficial for them in the long run:

The people who occupy the really low-paid positions within the symbolic professions (working for free or nearly so) are often able to persist in these roles while living in expensive cities (rather than relocating to somewhere more affordable but less glamorous and doing something else with their lives) because they are supported in part or in full by families or partners who tend to be relatively affluent, or because they have a nest egg of their own. Symbolic capitalists generally try to “stick it out” in these positions not because they lack other options but rather because they view even the unglamorous and poorly compensated work they’re doing as more valuable or meaningful than pursuing other forms of employment that might pay more in the short to medium term—and because they view these contingent jobs as stepping stones to positions with especially high pay, benefits, and social prestige.

In the meantime, the lack of compensation helps reduce the number of competitors for higher-pay, higher-status positions by weeding out most of those who are not from elite backgrounds early in the process (because most nonelites are unable to sustain themselves for long on little to no pay). Working in these relatively lowly positions also helps elite aspirants feel as though they have “earned” any eventual high-paying posts they might secure. As a consequence, if they are able to outlast the other competitors and successfully make the leap to the higher echelons, they demonstrate little sympathy or solidarity with those occupying the positions they used to hold.

For symbolic capitalists in this specific situation, it would be in their interests to oppose minimum wages for freelance journalists, because this would remove a barrier that makes journalism inaccessible as a career to people who aren’t of similarly elite backgrounds. But this seems very much like an edge case, and not something that would motivate symbolic capitalists in general to be skeptical of wage mandates.

An alternative explanation for why more highly educated people are skeptical of predistributive policies is that there are good reasons to believe such policies will backfire. Throughout his book, al-Gharbi frequently cites workers in the gig economy — Uber drivers, DoorDash delivery workers, etc. — as being emblematic of people who are exploited by symbolic capitalists. Do symbolic capitalists, for their own benefit, oppose predistributive policies mandating stronger wages for DoorDash drivers? It’s possible. Lacking mind-reading abilities, I can’t truly know someone else’s motives. But it’s also possible that skepticism of such policies is rooted in basic economics.

For example, I once wrote about how Seattle (a place frequently referenced by al-Gharbi as a symbolic capitalist hub) did, in fact, push through a mandate requiring DoorDash drivers to be paid more. The result, I said, could have been easily predicted by anyone who absorbed the lessons of Econ 101: Food delivery became more expensive, leading to fewer people placing food orders, while the prospect of increased pay led more people to become DoorDash drivers, resulting in more drivers attempting to catch fewer orders. The end result was that effective wages for DoorDash drivers significantly declined. As the drivers themselves described it,

“They’re not telling the whole story,” Shagen said. “Assuming that you are working constantly, then yes, you’re going to be making that much money. But that’s not what’s happening right now. Because people are not ordering as much anymore. The tips are going down because they think we’re making all this money.”

One driver shared how much he made on this week last year: $931. But this week, he only made $464.81.

Lardizabal said their “bread and butter” is often South Lake Union, near Amazon. But KING 5’s visit to the area Sunday resulted in several conversations with bored delivery workers who reiterated their wages have been slashed.

This brings me to another point of contention I have with al-Gharbi’s ventures into economic issues. As mentioned, he’s highly critical of the situation faced by gig workers and frequently describes them as exploited by symbolic capitalists. The way he describes things can often seem bit over the top to me. For example, he says,

What are Uber and Lyft drivers, for instance? They are chauffeurs for people who cannot deign to drive themselves around, take public transportation, or even exert the minimal effort of hailing a cab.

And of food delivery services, he writes,

However, for large and growing numbers of symbolic capitalists, it is not enough to simply have others prepare food for us—we often insist that meals are rapidly delivered to our homes as well (as it is apparently too much for us to pick up the food ourselves, let alone actually dining at the restaurants we order from).

This seems like a bit much to me. Indeed, when al-Gharbi worries about symbolic capitalists (including himself) that “we’ve likewise grown increasingly out of touch with the values and perspectives of ordinary Americans”, these statements of his could easily serve as an example of that. As al-Gharbi says elsewhere, people “who are genuinely vulnerable, marginalized, disadvantaged, or impoverished don’t think or talk in these ways.”

I mentioned in one of my initial posts that al-Gharbi analyzes social phenomenon using a lens he calls analytic egalitarianism – by which he means the “behaviors of white and racial and ethnicity minorities, men and women, and LGBTQ and ‘cishet’ (cisgender, heterosexual) Americans will be discussed in equivalent terms.” As an example, he goes on to say “For instance, when racial and ethnic minorities demonstrate a preference to hire, promote, mentor, and otherwise do business with coethnics, this is frequently analyzed in terms of in-group solidarity or building and leveraging social capital, and these behaviors are lauded. When whites engage in the exact same behaviors, they tend to be analyzed in a completely different way—almost exclusively through the lenses of racism and discrimination—and those who engage in such behaviors are pathologized and denounced.” Those who employ analytic egalitarianism would reject these double standards in evaluation.

I would suggest that when it comes to matter of economic class, al-Gharbi’s analysis could also benefit from analytic egalitarianism. Imagine speaking this way about an ordinary working-class person who decided to order some delivery from the local Domino’s while preparing to watch a weekend football game. Would we say to such a person, “I guess it’s just not enough for you to have someone else cook your meals for you — you can’t even deign to eat the food where it was made or even pick it up yourself, that’s just too much for you!” I can’t sign on to that – here, I am an analytic egalitarian. I don’t see any difference between Joe Sixpack ordering a pizza delivery on game day and Joseph Champagne ordering dinner from a Thai restaurant via UberEats. I would never speak so scornfully of the former — and for the same reasons, I see no reason to do so for the latter.

Many of al-Gharbi’s criticisms of Uber (and similar app-based services) strike me as off the mark as well. (A good counterweight to the concerns he raises can be found in the work of Liya Palagashvili, a brilliant economist specializing in studying exactly these issues — see here for a general introduction to her work.)

As part of his discussion of Uber, al-Gharbi makes what I think is another fundamental mistake when he says it is “the drivers from whom this wealth is derived.” It’s often easy for people to fall into thinking that the line-level workers are entirely or at least primarily responsible for creating the wealth of an industry. I’ve criticized this perspective here, but as it relates to Uber specifically, the flaw in this thinking was explained by this Uber driver far better than I could do myself.

In my next post, I’ll offer my thoughts on al-Gharbi’s views of wokeness, both how it is defined and on his argument about whether we should be woke.

 

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