“The ideas of economists, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.”
– John Maynard Keynes
Six years ago on Wednesday this humble blog was started. It’s been here MWF ever since, without a single break. Typically, the anniversary post is a chance to talk about where Barataria has been over the past so many years and brag up the stats a bit. But that’s not all that important. What is important is that this blog has covered a momentous time in the economy and life and general with a singular perspective – there are some really wild things going on that I don’t understand, but we can talk about them and maybe work out something together. It turns out that this perspective is far closer to what the “experts” have experienced than we thought. And it’s been one Hell of a ride to hang onto.
Where have we gotten in all this time? Barataria is at 986 posts and 9,419 comments over these six years, with nearly 2 million total pageviews. 137 people have signed up to be regular subscribers, and thank you all for that! But in all this time and all this writing (about 740k words!) one thing has eluded all of us – what exactly is going on?
Barataria started out as a blog about writing, since that was what interested me at the time. The first line was a very thin and silly joke:
It was a dark and stormy night.
I wrote that because it seemed fitting for someone with a tendency to ramble. And it was a dark and stormy night outside that cold April. What was less obvious was how dark and stormy the whole world was in the process of becoming.
A new book by the great economics guru Anatole Kaletsky is called “Capitalism 4.0”, and the principle is not that different from what we have been talking about here. The premise is that we’ve been through four different views of how a democratic society manages its economy through the dark and stormy science of economics. Before WWI they were separate (1.0), and after that failed we tried abject Keynesianism (2.0). When that collapsed of its own weight we went to a laissez faire approach with Reagan (3.0) that fell into utter chaos around 2008. Since then, we’ve all been working on 4.0, the one that comes next.
What is Capitalism 4.0? Consider, for a moment, the Fed and the ECB. These two central banks control the economies that produce nearly half of the world’s GDP, and yet they have been pursuing two completely different economic policies. What’s the right thing to do in this situation? There is no canon, no settled science to guide us. In its place is bounded chaos. The recent debate over changing the way we calculate inflation shows that we can’t even measure where we are accurately, let alone build solid policy on it.
Why is this a great topic for the anniversary? Because it turns out that no matter how we look at it, no one really knows what is coming next. No one knows exactly what to do about it. No one really believes we can fine-tune or otherwise regulate the economy, and certainly no one thinks that policy can simply make things better.
These are the times for a blog like Barataria. These are the days when all of us need to step up and reflect on what is important to us and what seems at least reasonable.
Now, that’s overstating the importance of Barataria pretty heavily. But duplicate this a few thousand times over a few thousand spaces where people can respectfully talk about what’s important to them and pretty soon you have the underpinnings of a movement!
So for all the words that have flowed through here and all the great discussion that you have all contributed to, I have only one thing to say – Thank you! Because in the end I have to admit that I also have just about no idea what I’m talking about, but that puts me in great company.
We live in a very new world, a world of Capitalism 4.0. What does that mean? It’s up to all of us to figure it out. I am very proud that Barataria has been here to do it’s humble best. Thank you all again for being part of it!