Krugman, Economies and the Next Civil War

When I was in graduate school pursuing a PhD in Economics, I was assigned to teach an Introductory Economics course for my assistantship requirements. I assigned my students twice-weekly readings of Paul Krugman's column in the New York Times editorial page. Of course, his column were political and I risked being accused of endorsing a Liberal agenda and swaying young minds, but Krugman was also an economist and his columns often gave a political perspective from an economic point of view. I was careful to focus in on the economic aspects of his columns and left the political portion open to discussion without criticizing or endorsing his opinions.

Upon leaving graduate school, the New York times began offering a paid service called Timeselect and Krugman's column was temporarily beyond my reach. I was ecstatic to learn the Timeselect was being cancelled a week ago and I could access Krugman's column and blog once more at the New York Times online page.

Krugman has a new book coming out with the same title as his blog "The Conscious of a Liberal." In the Introduction to his Blog, Krugman describes the growing inequities of income in the US. There is little doubt that the current disparities in income between the haves and the have-nots in our society - as well as around the globe - is troubling, to say the least. But Krugman appears to endorse a view that the recent trend, beginning with the Reagan administration, is a return to the previous days in America described as the Gilded age when robber barrens controlled the wealth of industry and had vast influence over political discourse in the US. Under this view, the depression era and post-war build-up of Government infrastructure supporting liberal agendas created an aberration in US history where wealth was distributed more equitably among the members of out society. This was the result of investment in public education, liberal legislation supporting unions and working families, and many other government programs and initiatives. Generally, I am in support of this view - but I also think it only tells part of the story leading to the solution of returning to more government run programs.

While income was distributed more evenly in American society during the great achievements of the post war liberal era, there was also a continuing migration from rural areas to urban and suburban areas as many Americans left income poor, yet self-reliant, households in rural America. This left vast rural areas in the control of large agricultural conglomerates with no ties to the people in these previously resilient communities.

These thriving rural communities may have been populated by households that were described as low income, but as my Grandma said of life on the farm, “We didn’t have no money, but we were never hungry.” The economies in these rural areas were kept aloft through the informal economy that could not be described with income. It can be better illuminated in the oownership records with many small farms owned by individuals with little income, still living pleasant and comfortable lives through their interconnected relationships and economic transactions with the community that were not pecuniary in nature. These transactions can be described as bartering, work-sharing, cooperatives, gifts and neighborliness. What makes the inequality in America today much more daunting than the inequality of the past is the reliance upon income over relationships amongst our neighbors.

In effect, although this postwar liberal era can be seen as a panacea through many lenses - the result of large government projects and initiatives - the liberal policies also contributed (and continue to contribute) to the loss of our rural communities and economies to the economic incentives of greater profits through the capture of economic transactions that previously were not part of the formal economy. Today we see the same trends in privatization in security, warfare, disaster relief and education. A closer look at Krugman's analysis might reveal a coup whereby liberal policies built up large government infrastructures through tax payer dollars enticing waves of Americans from rural areas to abandoned their communities and self-reliant lifestyles for the income supported lives of our modern era. Now the government (which is vastly subservient to corporate agendas) has began the process of selling (giving away) this infrastructure to the wealthy few - leaving in place a huge and much more chilling corporate/military infrastructure designed to serve the money interests while leaving citizens without income, property or the means to sustain themselves.

All of this leads to the current situation with the Eric Prince lead Blackwater along with other security firms. Imagine a future where the Generals are competing with CEO's for government funds. We may be witnessing the onset of the second civil war if congress begins the process of reducing these private mercenary companies. Eric Prince and his family have given vast sums of money to Republican campaigns with radical Christian and nonconservative agendas. He has given zero dollars to democrats. He is in control of the worlds largest private military and is being questioned by a democratic congress. It has the makings of a great Science fiction novel at the very least.