Intermediate Macroeconomics: Econ 101b: Spring 2018: U.C. Berkeley: Sample Final (DRAFT)

American Economic History: Slides for Wrap-Up Lecture...

Each time I do this I think there must be a way to do it better. But each time I fail to think of one...

Good ideas very welcome...

Here we are https://www.icloud.com/keynote/0AuVq4veo1M_lK-EXXK3kQUwg:

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J. Bradford Delong
http://bradford-delong.com
brad.delong@gmail.com
@delong

2018-04-30

https://tinyurl.com/113S2018

https://www.icloud.com/keynote/0AuVq4veo1M_lK-EXXK3kQUwg

Big Ideas: Review

  1. Narrative
  2. Varieties of nationalism
  3. The furnace where the future is being forged
  4. Slavery and its echoes
  5. Large but unequally-distributed liberty
  6. Built on immigrants
  7. Used to deliver high opportunity
  8. Has delivered high prosperity
  9. Growth-oriented industrial policy
  10. Well being-oriented industrial and social welfare policy
  11. The Gilded Ages
  12. The Age of Social Democracy as the apogee
  13. Structural transformation
  14. Regions and cultures

 

Narrative

  • We tell stories; we learn by listening to stories; we think by means of narrative Hence historical narratives have extra-special salience in our brains
    • Easier to remember stories than theories or checklists
    • And what can theories be but crystallized historical episodes?
    • Need the history to understand whether the theory is any good…
  • Opened with a story:
    • The story of Leon Trotsky
    • And his view that America was “the furnace where the future is being forged”
    • Did this to arrest you
      • Did it work?

 

Varieties of Nationalism

  • Threefold:
    • (Utopian) New England
    • (Libertarian) Virginia
    • (Blood-and-soil) Kentucky
  • These threads we have seen throughout the course over and over again…
    • For ex., both slavery and abolitionism…
    • And the failure of socialism to take hold…
    • Plus “war to end war" and “crusade in Europe”

 

The furnace where the future is being forged

  • The leading nation in terms of technology and prosperity over 1850-2016
  • Thus the first to try to grapple with its opportunities and dilemmas
  • Plus: frequently engaged in crusades to make the world better (New England nationalism)

 

Slavery

  • Plantation-based chattel slavery producing staples for the market not the most evil piece of human history
  • But it is way up there…
  • Familial vs. industrial slavery
  • Jim Crow
  • Echoes down to today
  • “Everybody gets to become white, except for Blacks”
    • Does that still hold?

 

Plus Ten MOAR Big, But Lesser, Ideas...

 

Review: The Making of Our World

  • The Post-WWII Boom: Thirty Glorious Years—Ending in the 1970s
  • The Great Depression and World War II together ended the idea of laissez faire: the idea became guilty until proven innocent.
  • The idea of laissez faire had in fact been dying for a while…
  • And yet it survived…

 

Survival and Return of the Hard Laissez Faire Right

  • Continued to argue that government beyond the “night watchman” would succumb to iron laws of power that would push it to totalitarianism…
    • Even argued that the Great Depression showed not the bankruptcy of laissez faire but the bankruptcy of government interference…
  • The return of the hard laissez faire right in the neoliberal era

 

Causes of the Rise of Neoliberalism

  1. Inflation of the 1970s (Krugman)?
  2. Ethnic (Alesina)?
    • The Curse of Goldwater (and Nixon)
  3. Natural drift (Piketty)?
  4. Pure chance (Reagan and Thatcher)?
  5. Mont Pelerin (“Astroturf”)
  6. Social democracy overreach?

 

Hard Neoliberalism: Mitt Romney

  • “47 percent… with [Obama]… dependent… believe that they are victims… that government has a responsibility to care for them… that they are entitled… people who pay no income tax….
  • “My job is not to worry about those people—I'll never convince them that they should take personal responsibility and care for their lives…”

 

A Nation of Takers?: Ann Romney

  • “Not easy years… basement apartment…. didn’t have money to carpet the floor… remnants, samples, so I glued them together, all different colors….
  • “Mitt had enough of an investment from stock that we could sell off a little at a time….
  • “Mitt and I walked to class together, shared housekeeping, had a lot of pasta and tuna fish and learned hard lessons…”

Demography and Feminism

  • The Demographic Transition:
  • In 1820: 7 live births per mother
  • By 1900: down to 3.5
  • Then followed: Great Depression, Baby Boom, and baby bust
  • Now: ZPG
  • 36 mo. pregnant and breastfeeding today as opposed to 240 mo.

 

Female: Employment-to-Population Ratio

  • Males: 85% in 1948; 66% today
    • Half of this male fall from retirement…
    • Women are aging too…
  • Males 25-54 from 95% to 85%…
  • Females 25-54 from 38% to 70%…

 

Female vs. Male: Education

  • In 2011, women held 51.4% of “managerial and professional jobs”
    • Up from 26.1% in 1980
    • Redefinition of “secretaries”
  • Seven years of longer life expectancy counts…
    • You would expect 53%-47% from that alone, but not 62%…

 

Sheryl Sandberg at Barnard

  • “Women… like us except for the circumstances into which they were born, [lack] basic human rights….
  • “We [here] are lucky.... We are equals under the law. But the promise of equality is not equality....
  • “We are nowhere close to 50% of the jobs at the top. That means that when the big decisions are made, the decisions that affect all of our worlds, we do not have an equal voice at that table.
  • “So today, we turn to you.....

 

The Overclass

  • And the top 0.01%? We pay 5x as great a share of income now as in the 1970s for whatever they do. 15K households. $750B/year. $60M/year each…

 

Are We Back to Normal After the Great Recession? Not Really

  • Interest rates are still remarkably, insanely, absurdly low…
  • What will the Federal Reserve do if it next finds the economy in a “general glut”?
  • Since late 2014 “austerity” has been on hold in the U.S.
  • But no utilization of ample fiscal space
  • The idea of “secular stagnation”…
  

Our Present Through a Polanyian Lens

  • Stagflation
  • Dani Rodrik on Karl Polanyi
    • “The hidden assumptions of economic theory. Behind those market transactions, expressed with mathematical formalism and in Greek letters, was a host of social, political, legal institutions that enabled those transactions….
    • “The more I became an economist, the more Polanyi’s insights resonated…. I was simply restating the main themes of the Great Transformation for our current era…”

 

The United States a Lucky Country Today… cf.: Milton and Rose Director Friedman

  • But Are We Feeling Lucky?
  • The Three “Fictitious” Commodities
    • Land—your community
    • Labor—your standard of living
    • Finance—your occupation/firm
    • All determined by a sociological logic of “desert”—in the sense of “deserve”
    • The rebellion of “society” against the “market”

 

But It’s Not a Rebellion Against the “Market”, Really…

  • Polanyi’s error…
  • Joseph Bailey could have told him better…
    • Against “rootless cosmopolites”
    • For: restricted community
  • In the U.S.
    • Mitt Romney (2012)…
    • Lyndon Johnson (1964)…
    • Sam Rayburn (1940)…
    • Joseph Bailey (1914)…
    • Breaking of the Populists/Populists (1892-96)

 

Your Mission, Should You Choose to Accept It…

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