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Towards a progressive concept of efficiency

Bill Mitchell questions what we mean when we seek “efficiency”.

How efficient are those abandoned by society to long term unemployment??

Full_Employment_Abandoned_2008

“..a discussion of what we mean by efficiency is important because the way we construct that concept determines how we evaluate the propositions we are advancing.

For example, one of the oft-repeated claims that large-scale public job creation programs (like a Job Guarantee) are wasteful, ‘make work’ schemes that lead to the economy’s resources being utilised in sub-optimal ways.

The critique is based on what we consider to be a narrow-based conception of efficiency, the type that dominates mainstream economics.

The mainstream neo-liberal version of the concept that economists like to repeat ad nauseum seems to think it is efficient to have 25 per cent unemployment (and 50 or more percent youth unemployment in some cases) as long as the fiscal balance is in surplus or below some ad hoc threshold.

This private cost and benefit construction of what is efficient and what is not is bereft of credibility in a progressive vision which evaluates things in terms of society rather than economy, human well-being rather than private profit.

The other example, which came up last week (as noted in the Introduction), were the claims that the nationalised industries in 1050s and 60s Britain were havens of waste and inefficiency as they were in other nations during that period. By what reckoning would we draw that conclusion? Once we broaden our view of efficiency then some of those conclusions become meaningless.

They are just neo-liberal constructions and concepts deployed to advance a particular class interest at the expense of society and the workers within it

 

PART II HERE

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