Trying to Recover a "Real Economy"

Marie Cocco's column for today's Washington Post, reproduced, as usual, on Truthdig, has the great title, "It’s the Jobs, Stupid;" and that is exactly how she begins her text:

The last thing we need is another “economic stimulus” package. What we need is a jobs package. And we ought to start calling it that.

The argument that she develops around this precept is laudable, but I think she has missed out on the extent to which that argument has to be embedded in a bigger picture. That bigger picture involves the more general question of what Japanese broker Masatoshi Sato, whom I cited yesterday, referred to as "the real economy." As I tried to argue yesterday, this "is the economy where 'real people' (rather than the once and future 'Masters of the Universe' in the financial sector) have to make basic purchases for food, clothing, and shelter." Needless to say, you could have flunked Economics 101 and still come away realizing that you need an income source in order to make those purchases, which is where Cocco's arguments about jobs come into the picture. What concerns me is that we may have become too far gone in the confidence games played by those "Masters of the Universe" to regain our footing in such a "real economy."

Consider the argument I first floated at the end of last week: On a global scale the bank that may well have suffered the LEAST from the current crisis may well be Grameen Bank. The reason for this (at the risk of sounding too reductive) is that Grameen is still based (as I put it in my argument) on "an exchange system that is still grounded in the more concrete realities of cows and chickens." The economic engine of the United States is no longer grounded in manufacturing or agriculture. Indeed, it is no longer grounded in anything that Economics 101 would call "goods." Worse yet, most of the "services" that have displaced the position of those "goods" have either been shipped overseas (as in call centers) or subjected to devastating cuts in resources (whether we are talking about librarians or bank tellers). This leaves the United States with a very narrow band of service providers in the financial sector who do little more than manipulate people's belief systems over the value of "fictions of convenience," such as currencies, stock futures, and commoditized packages of debt. Our economy is so far from reality that, were it being analyzed by a psychiatrist, it would be deemed psychotic without a moment's thought!

Thus, while Cocco's call for a jobs package is admirable, there is a serious underlying question: "Jobs for what?" The fact is that we need to rethink the very nature of our political economy beginning with its very foundations. I say this knowing full well that talking about a critique of political economy is sure to get many of our "true patriots" foaming at the mouth, since it invokes Karl Marx, that boogie man who probably continues to terrorize them even more than Osama bin Laden. Nevertheless, if we are going to try to restore that "sense of reality" to the foundations of our economy, we would do far worse than to revisit the "Critique of the Gotha Program" and consider what its famous motto ("From each according to his abilities, to each according to his needs.") is really trying to say. Grameen Bank knows how to think in terms of needs and abilities and still make a profit. Can our country think in similar terms and find its way back to living under a "real economy?"