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Race, Class and Improbable Economics at the New York Times

The FBI as Racial Arbiter?

The New York Times has been a tool of elite propaganda since it rose to prominence most of a century ago. Pressing news, such as holes in the (George W) Bush administration’s case for war in 2003, is treated as opinion and opinions like much of its economics reporting often gets treated as news. When giving a public forum to connected insiders the quality of analysis is rarely a determining criterion. Two recent examples include an FBI sourced analysis of racial bias in police murders in the U.S. and support for the Obamacare (Affordable Care Act) ‘Cadillac tax’ that relies on economic premises— those at the very heart of Western economics, that very few people would likely find convincing if they took the time to think about them.

Readers who haven’t been (mis)educated in economics tend to read the occasional economist’s argument that combines an appeal to social mythology with absurdly reductive analysis and assume that there is substance behind it. Likely unbeknownst is that what is taken as a badge of honor amongst economists, the capacity to develop ‘counterintuitive’ arguments to be put forward through very narrow circumscription, is most commonly a process of mystification rather than brilliant insight. By and large these arguments do not display depth of understanding and the analytical reductions used to make narrow points tend to disintegrate when broader considerations are brought to bear.

Public discourse on race in the U.S. tends toward an exercise in hermeneutics. Cloistered White suburbanites have fundamentally different experiences with the police, employers and with predominantly White institutions than do many Blacks and poor and working class Whites. This is one of the explanations for the use of ‘empirical’ data in social analyses— to look past differences in lived experience to develop a common language. However, the use of ‘official’ sources for data on racial bias in American policing requires in depth knowledge of American racial history. That national data on police murders is not collected by design suggests that particular care be used with the data that is available.

A recent article in the Times ‘Upshot’ economics column entitled: Police Killings of Blacks: Here is What the Data Say by Harvard University economist Sendhil Mullainathan relies on FBI data on police killings of citizens without regard for the FBI’s tainted racial history: its known participation in illegal tactics against Civil Rights leaders, its deep involvement in KKK (Ku Klux Klan) operations over several decades, its COINTEL program of illegal spying on, subversion of and incitement to murder members of legitimate civilian protest groups and widely known deficiencies in its data. Even if one were willing to look past this long history of racial repression, the FBI’s Supplementary Homicide Report is an aggregation of self-reported data from police departments at risk of Federal sanction if racially biased police murders are accurately reported.

lynchings

Post-Reconstruction lynching of former slaves and ‘free’ Blacks in the U.S. was intimately tied to the police and policing as a mode of racial control. Largely portrayed as ‘vigilantism,’ the police did little to stop lynching and in many cases were involved either through delivering Blacks to vigilantes to be lynched or through direct participation in acts of lynching. Today (2015) Blacks are not only murdered by the police in overwhelming disproportion to their representation in the broader population but are incarcerated in conditions of rape and social isolation that are torture under any reasonable definition of the term. Police reports of racial bias in policing need to be seen in the context of two centuries of police participation in racial repression. Source: (irony alert): the New York Times.

A central shortfall of self-reported data is that it is self-reported. In the absence of the requirement that police murders of civilians be uniformly reported and independently verified as to both basic facts and characterizations (e.g. ‘justified’ versus ‘unjustified’ homicides) conclusions drawn describe the deficiencies in the reporting process and not the ‘facts’ allegedly gleaned from the data. Not only is normal self-selection bias likely— those who have the time and inclination to self-report are not necessarily representative of the population of interest, in the case of racist murders by the police, it is virtually guaranteed. And in fact, taking the data at face value displays a cloistered credulity against the whole of American History, alternative accounts of racist police violence and the very fact that police reporting is both partial and wholly voluntary.

The starting premise of the piece is that racial bias, or not, is an individual characteristic of individual cops that may or may not lead to racially motivated shootings. This is, that the social role of the police as determined by three centuries of racial repression from slavery and slave patrols to mass lynching and race based terrorism against Black citizens, Jim Crow, the New Jim Crow, racially biased drug laws and mass incarceration may or may not relate to the ‘individual’ predispositions of individual cops that may or may not, depending on what the data ‘say,’ need to be addressed. The question then is: can ‘we’ determine if racial bias drives individual cops to shoot more Blacks than Whites using the FBI’s compilation of self-reported data from individual police departments?

The gist of the argument (top link above) is that Blacks, as a proportion of the population, have far more encounters with the police than do Whites and they are shot by the police in approximate proportion to the number of these encounters, as is true of Whites. The conclusion then is that while broader social factors may explain differences in the number of encounters that Blacks and Whites have with the police, once an encounter is underway the chances of being shot are about the same whether one is Black or White. The system of policing may be racist to its core, ‘individual’ cops substantially constitute this system, the outcomes in terms of both police encounters and murders are demonstrably racially ‘biased,’ but there is no evidence that individual cops are racist when they pull the trigger. That’s a relief.

Given how mundane the conclusion is: that outcomes in terms of police murders are unambiguously racially biased but that where precisely this bias resides is not immediately evident from the FBI’s self-reported data compiled from local police departments begs the question of why the author thought it worth reporting and the New York Times thought it worthy of publication? The broader history of ‘scientific’ racism— the use of irrelevant (phrenology) and / or socially complex (racialized criminology) data to ‘find’ bogus empirical bases of racial difference where there are none, has a long, inglorious history. None other than Harvard’s Stephen Jay Gould provided a profoundly insightful take-down of scientific racism in his The Mismeasure of Man. (The University of Pennsylvania rebuttal is about intentions, not social consequences).

Racist execution of racist laws by the police points (rightly) to the institutional nature of institutional racism but hardly lets individual cops off the hook for their participation in this system. At its most basic, the fact of police murders of citizens begs the question of their intended role? The author can argue that this is a question for further analysis, but then why put forward such a limited analysis as socially additive when its place in American racial discourse is firmly on the side of toxic misrepresentation? The FBI’s compilation of police data is at a minimum demonstrably incomplete. The cultural and historical myopia required to take it at face value places both the author and the New York Times on the side of reckless misdirection.

Does Consumer ‘Choice’ Involve a Functioning Health Care System?

What goes largely unstated by economically inclined Obamacare supporters is that the base premises of Obamacare are neoliberal boilerplate— either they improve health care outcomes or the larger program is at risk of being worse than nothing. The oft-claimed problem of ‘starting point;’ that the U.S. had a public-private health care hybrid that made reforming the existing system more feasible than ‘starting over from scratch’ ignores how the U.S. got to this hybrid. Much of the American health insurance system was designed to lock workers into their jobs through employer-sponsored health insurance plans that weren’t portable when workers changed jobs. Health insurance and pensions were negotiated along with wages as the total compensation of labor— benefits were earned and not ‘given’ to employees as modern mythology occasionally has it.

This latter point, that benefits are part of the total compensation of employment and any reduction in health insurance costs, or rather shift of them from employers to employees, will be returned through increased wages, is key to the econo-fantasy woven by former Obama (and Clinton) administration policy hack Larry Summers and former ‘boy genius’ and keeper of antique economic ideology at Harvard, Greg Mankiw, who together laid bare the economic premises of Obamacare in a recent New York Times editorial. They did so in the context of defending the ‘Cadillac Tax’ provision designed to shift the costs of health insurance from employers to the insured (a/k/a workers) under the premise, to quote, that they need ‘skin in the game’ to make wise health care choices.

“If people have insurance that pays for too much, they don’t have enough skin in the game. They may be too quick to seek professional medical care. They may too easily accede when physicians recommend superfluous tests and treatments. They may not try hard enough to buy services from the lowest-cost provider. Such behavior can drive national health spending beyond what is necessary and desirable.”

The premise that people will accede to unlimited anal probes, blood sampling and physical stress tests simply because health insurers will pay for them likely underestimates how many other things we have to do with our time. This ‘over-consumption’ fear, when combined with the overall poor health care outcomes that most Americans experience, assumes either (1) that we already get all of the health care we need but the quality is so poor that it is of minimum benefit or (2) that we get too little health care meaning the problem in need of solving is under-consumption of health care rather than over-consumption. As-of-yet there has been no claim made that Obamacare has resolved this under-consumption problem. Why then is a tax so urgently needed to address it?

American discourse around health care features the selective interweaving of history with ideology posed as pragmatism. The term ‘Cadillac Tax’ suggests outsized benefits ‘granted’ to bloated executives at the expense of ‘ordinary’ Americans. In fact, the health insurance benefits to be taxed were negotiated in lieu of wages and other benefits, largely by Middle and working class labor. The shift to high-deductible plans since Obamacare was enacted is designed to keep insurance premiums low while raising total health care costs through higher deductibles and co-pays. Most large employers are expected to offer only high deductible plans over the next few years. Reference to ‘average premiums’ (below) is a misrepresentation when health care costs are being reconfigured to lower premiums while raising total costs.

“The Cadillac tax levies a 40 percent excise tax on the portion of total health insurance premiums that exceed $27,500 for a family in 2018 and $10,200 for an individual. By way of comparison, in 2015 average premiums in employer-sponsored insurance for a family are $17,545 and for an individual, $6,251.”

The tax is designed to ‘force’ employers to reduce the value of the health insurance they negotiated with workers or pay a substantial tax on the difference under the deeply misleading premise that this difference will find its way into worker paychecks. As history has it, labor’s share of both corporate revenues and national income has been declining for the last half-century and has fallen off of the proverbial cliff in the last fifteen years (Graph (1) below). Without restoring labor’s bargaining power, which Messrs. Summers and Mankiw spent their time in public office fighting against, there is very little possibility that employer ‘savings’ (from shifting costs to labor) will find its way into employee paychecks. The basis of the Summers / Mankiw claim is ideological— it fits their theories of how the world should work if their theories are correct with little regard for whether they are, in fact, correct.

uriefredlabor

Graph (1) above: labor’s share of business income (indexed) fell steadily from 1960 to the mid-1990s and has fallen off of the proverbial cliff since then. The modern benefits system tied to employment arose through the effort to hoard labor following a substantial culling of the work force in World Wars I and II and the related rise in the American share of industrial production due to the destruction of overseas productive infrastructure. Democrat Bill Clinton passed NAFTA (North American Free Trade Agreement) soon after he entered office and his administration, including Larry Summers, led the effort to deregulate Wall Street. Wall Street’s role in the decline of labor power comes both through direct lobbying to shift income from labor to business and finance and through expanding the low-cost labor force by making capitalist production fungible (financialization). Source: St. Louis Federal Reserve.

To spend a moment with the premise of health care ‘choice,’ how precisely would health care consumers know if a test is superfluous or necessary without a medical education? Is an x-ray superfluous for a possible spinal cord injury? Is it effective in aiding a diagnosis? Are blood thinners a proper treatment for a stroke in progress? How about after the stroke has occurred? Is a blood test necessary to diagnose diabetes? Are spots in one’s vision a problem with the eyes or a sign of a possible stroke? Is an allergy test for psoriasis necessary or superfluous? How would one shop for the lowest price services in a narrow network that provides minimal choices of physicians and procedures? In a medical emergency is the expectation that we comparison shop before seeking care? How do we ascertain that everyone involved in complicated medical procedures is ‘in network’ when hospital practice is to use the physicians and staff that are available?

The starting point of the neoliberal perspective is someone with the education, time and resources to make ‘informed’ consumer choices whether regarding the purchase of plumbing, automobiles, hotels in Montenegro or kidney surgery. This view is both theoretical and aspirational— it isn’t an empirical claim that people are like this, it is the economists’ insistence that we be made to be like this. Ironically, the capitalist conception of productive ‘efficiency’ found in the ‘division of labor’ is narrow specialization, the development of particular knowledge and skills so that we each play specific, and interwoven, roles in capitalist production. The neoliberal concept of ‘perfect knowledge,’ of knowing everything, everywhere, all of the time, is both radically inefficient in the classical capitalist sense and a totalitarian imposition when it is used to force people to conform to neoliberal institutional dictates.

The political union of Democrat Larry Summers and Republican Greg Mankiw in support of Obamacare illustrates both the deep ideological roots of the program in neoliberal looting of the public realm and the absence of ideological difference between the major political Parties on economic issues. Republicans openly call for gutting Social Security, Medicare and Medicaid to their political disfavor while Democrats use privatization and stealth institutional changes to shift economic power from labor and citizens to corporations and the owners of capital. On the horizon are ‘trade’ agreements (TPP and TTIP) being pushed by Democrat Barack Obama to ‘harmonize’ U.S. labor conditions with low-wage signatories and to limit recourse for gutting the public realm through development of extra-judicial tribunals acting in the interests of multi-national corporations. The future looks bright.

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Rob Urie is an artist and political economist. His book Zen Economics is published by CounterPunch Books.

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