Economics... again. (Sigh.)

In April, New Zealand’s Labour-led government raised the minimum wage from $16.50 to $17.70 per hour. Basic economic theory, which I have perforce become acquainted with over seven years of taking undergraduate notes in a far-flung range of subjects, would predict that the unemployment rate must rise proportionally. Being also acquainted with the methods by which economists arrive at basic economic theory, I am therefore entirely unsurprised to read that

New Zealand’s unemployment rate fell to 3.9 percent in the second quarter of 2019 from 4.2 percent in the previous period, compared to market expectations of 4.3 percent. That was the lowest jobless rate since the second quarter of 2008, when it was 3.8 percent. Unemployment rate in New Zealand averaged 5.99 percent from 1985 until 2019, reaching an all-time high of 11.20 percent in the third quarter of 1991 and a record low of 3.30 percent in the fourth quarter of 2007.

—Trading Economics

In case you’re wondering, yes, the second quarter of 2008 was towards the end of the Labour Party’s previous term in government, as was that record low in 2007, and 1991 was in the first term of the National government before them. Trading Economics has a graph of the New Zealand unemployment rate for the last thirty-three years, which I’ve taken the liberty of colour-coding rather crudely in Paint according to the leading party of government. (Note for Americans: in New Zealand as in most of the rest of the world, the left-leaning party is branded red and the conservative party blue.)

I don’t want to read more into this than is warranted. National took the reins of government from Labour twice during this period, and both times came shortly after worldwide financial crises, so I’d be cautious about blaming them for the big upticks in unemployment at those times. Crises aside, the longer-term trend is downward. What I do want to point out is that there is no sign of the upward drift that orthodox economic theory would lead us to expect during Labour’s tenures, despite the fact that they raise the minimum wage every year by much bigger increments than National does.

This semester I’m taking a first-year economics class, again. It’s struck me right from the start how much it’s re-treading ground I’ve been over and over since the first time round, seven years ago. If that doesn’t sound surprising, by contrast I’ve been assigned to papers in various health professions each semester since 2013, and every year there’s been a module on cancer, and every year there’s new insights about how cancer happens and what healthcare providers can do to fight it. That’s what progress looks like. That’s how you know a discipline is open to learning new truths.

In fairness, this semester’s lecturer has mentioned a few things which, in previous economics classes I’ve been to, have been skated over completely. He did take care to point out, for example, that sometimes people don’t buy certain goods or services not because they don’t want to pay the market price but because they can’t – the first time I’ve ever heard this distinction highlighted. (Unfortunately he seems to have missed some rather major implications of it, but we’ll get to that.) Also he’s promised an upcoming block of lectures on market failures, which up till now I haven’t heard economists talk about to students below third-year.

Still, as in previous years, the lecture material treats labour as just another good or service, which workers sell and employers buy. When you draw a supply-and-demand graph, the demand curve slopes downward, meaning that the more something costs, the fewer people will be willing to buy it and the less of it will get bought. Meanwhile the supply curve slopes upward, meaning the more it costs, the more people will be willing to sell it and the more of it will be available for sale. Where the two curves cross, the amount people are trying to buy equals the amount available for sale, and the price at which that happens is the market price or “equilibrium” price. They’re called “curves” but they’re usually graphed as straight diagonal lines. The slope of each curve is called its “elasticity”.

I’m not allowed to ask questions in lectures, and after any lecture there’s usually a few students wanting to talk to the lecturer and their practical need for information obviously takes precedence over my idle curiosity. But after the lecture introducing the concept of a supply curve, I had a rare opportunity for conversation.

Cannabis

So it turns out the Otago University Proctor has been burgling student flats and nicking people’s bongs. There was a big protest against him last week, which I sadly couldn’t attend due to a class. I remember a time when the student libertarians could make common cause with us campus Lefties on cannabis decriminalization, if nothing else, but all the right-swinging commentary I’ve seen on the issue this week has been of the bog-standard cookie-cutter “if you think this is abuse of power go live in North Korea” variety.

It is morally wrong for a person in authority to break into people’s private spaces and remove things unless their authority is specifically and publicly constituted to grant them the power to do that, and the Proctor’s is not. This follows so straightforwardly from the trust principle that I can’t be bothered laying it all out. It is equally clearly morally wrong to constitute any authority to give its bearer the power to break into people’s private spaces and remove things unless the things in question pose sufficient risk of harm in that space to outweigh the breach of trust occasioned by the break-in. Any law which grants (for example) the police such powers is an immoral law and ought to be both changed and, until it is changed, resisted. Again, taking the trust principle as the basis of morality, which I do, that follows as night follows day. And I’ve argued the trust-morality connection over and over again on this blog, so I shall skip over that too. The only remaining question, and the topic of this post, is: does cannabis pose a risk of greater harm than is caused by arrests, seizures, prison sentences, and permanent criminal records?

The answer to that question is as follows:

No.

Well, that was easy. See you next ti—

...oh, all right. Here, have a graph. If you click it, the link will take you to the data behind it.

There are exactly zero confirmed cases of death from cannabis use – in stark contrast with alcohol and tobacco, both of which are legal. For addictiveness it’s roughly on a par with caffeine. It is associated with the same sorts of respiratory injuries that tobacco is, but that’s (as far as researchers can tell) because it’s delivered as a smoke and so comes along with tars and similarly harmful products of combustion. Hence if your drug laws are to have any semblance of logic or consistency, either you must allow cannabis or you must ban alcohol and tobacco. And if you’re thinking about the latter option, the United States already tried that with alcohol and it was a disaster.

Cannabis does bring a heightened risk of developing schizophrenia if it’s heavily consumed in adolescence. That, I’ll grant you. And it is reasonable to ask how, once legalized, it would be kept out of the hands of teenagers, given that the surest way to get teenagers to try something is to tell them it’s for adults only, as the tobacco companies know to their tremendous profit. But I’ll tell you a big secret: prohibition isn’t keeping it out of the hands of teenagers either. If you sell a substance legally, you’ll probably think twice about selling it to under-age people because that’ll get you in trouble. If it’s a prohibited substance you’re in trouble anyway, so why narrow your market?

The damping effects of cannabis on motivation are much better-known than the medical evidence for them actually warrants. Part of the problem is that people assume the cause upon seeing the effect. I have long hair that I can’t seem to get the knots out of, and I don’t wear shoes much, and so I have often been asked by complete strangers where they can score some pot in Dunedin; whereas you probably wouldn’t make that assumption of an internationally successful scientist and author like, say, Carl Sagan. On the handful of occasions when I have smoked pot, I’ve found my motivation increased rather than lowered – one time I stayed up all night writing.

I won’t deny there are people who take up cannabis and proceed to lose all interest in life; but, as is typical with other substance dependencies, I suspect you’ll find this is a sign of underlying stressors like an abusive home life or an unsustainable work or study schedule with no other way out. And if someone is having substance problems, it’s easier for a legal supplier than an illegal one to refuse their business, as G. K. Chesterton long ago pointed out with regard to alcohol. Perhaps this is why Portugal has experienced such a drop in drug-related social problems since they legalized all recreational drugs there.

There are of course many wild claims out there about the health benefits of cannabis; if you believe some people, it’ll cure everything from cancer to the common cold. It’s hard for researchers to find out which of these claims have substance on account of, you guessed it, prohibition. I mean, sure, a government can license a pharmacology institute or whatever to do controlled experiments, but they can’t exactly license the entire supply chain so the institute can get hold of enough of the stuff to run anything with a meaningful sample size. Nevertheless, it’s pretty clear that cannabis is an effective painkiller, and last I heard there was some evidence – at a “not sure yet but worth following up” level – that it might slow the progression of some cancers.

Even if you want to be cautious about recreational cannabis, there is absolutely no justification for keeping it from being used as a medicine. Obviously it wouldn’t come from the pharmacist as a cigarette, since smoke and tars do so much damage to your lungs. And it’s a bit slow to get working when taken orally, hence why people sometimes get into trouble the first time they try edibles, eating more and more just because it hasn’t hit yet. The fastest form of delivery might be a nasal spray; your smelling nerves take in molecules from the air because that’s how smell works, and they’re a direct channel to the brain because that’s how nerves work. For people with impaired olfactory function, an inhaler might be a second option.

Actually I started writing this a few days before the protest. I was editing some lecture notes in a university library a couple of tables away from the door to a videoconference room, and three students went in and proceeded to hold what was evidently the Nay side of a video-link debate on the legalization of cannabis. The male one of the three had a particularly loud and annoying voice, but all of their arguments were so stupid that I must, in charity, suppose that they had been roped in to argue the Nay side without believing a word they were saying. (This is why I’ve never done competitive debating.)

Their worst argument of all was against medicinal cannabis. We don’t need it, said Mister Loud Voice, because we’ve already got painkillers. Maybe if I hadn’t had so many pharmacy lectures in the last few years that wouldn’t have sounded quite so head-smackingly silly. Yes, we have other painkillers. We have paracetamol (what North Americans call acetaminophen), which is safe unless you have liver disease. We have non-steroidal anti-inflammatories like aspirin and ibuprofen, which are moderately safe unless you have stomach ulcers or acid reflux. We have corticosteroids, which do nasty things to your bones if taken for any length of time, and we have opioids, which right now are killing Americans in record numbers as the cohort who got addicted to them en masse in their teens enter retirement. A lot of elderly people have both liver and stomach trouble and can’t really afford to make their bones any weaker than they already are. What possible justification can there be for denying them a safe, effective painkiller?

Close behind was the bit where they said their main concern about cannabis was that it might lead people on to other, more harmful drugs. Yes, I’m sure that happens. But do you know why it happens? It happens because once you’ve got into cannabis, well hey, you’re already breaking the law and thumbing your nose at a disapproving society, so why not go for a harder-core experience? The same happened with alcohol when that was prohibited. Once again, legalization would lighten the problem, not worsen it.

All the same, that argument does illuminate the cultural mindset that hangs like a ball-and-chain about the ankles of the legalization movement. The basic problem is one of our mental categories for hazardous substances. Some substances are filth and some are poisonous and some are medicines and some are chemicals, but the troublesome class here, the one cannabis has been put into, is the class we think of as Drugs! (The exclamation mark should be pronounced as a horrified gasp.) I can’t just call them “drugs”, because that word, like “chemicals”, has an application which is scientifically meaningful, morally neutral, and vastly broader than the colloquial one. Drugs in the scientific sense do include cannabis, and also alcohol – the phrase “drugs and alcohol” makes about as much sense as “vehicles and cars” – and caffeine, and nutmeg, and St John’s wort, and moisturizers, and anything else that has a dose-dependent effect on the human body or mind.

Drugs! as a subclass of drugs share no common attribute but that they are illicit. But because they’re a culturally recognisable category, it’s easy to think of them going together. Thus, to Mister Loud Voice and millions like him, cannabis goes naturally with heroin and cocaine and methamphetamine because they are all Drugs! The government in its infinite wisdom has recognised that people should not use Drugs! and so has passed laws against them. If you let people use one kind of Drugs! then you are declaring that Drugs! are OK after all, so of course they’re going to move on to other kinds of Drugs! as well. In case you haven’t guessed, I think the very concept of Drugs! hinders rather than helps us in developing rational drug safety policies. But that’s by the by.

So if there’s nothing wrong with cannabis, why is it illegal? I don’t think Mister Loud Voice used that particular argument, but others certainly have. The answer, of course, is that most law-makers think that way too. But why did it become illegal in the first place? Recreational marijuana, previously the most popular legal alternative to alcohol, was banned in the US just when Prohibition was lifted and all the enforcement officials were looking for new jobs. Medical cannabis followed in the 1970s as a casualty of Richard Nixon’s War On Drugs. And the US has enough clout internationally that a lot of other countries still think it’s an example worth following. I’m chary as a rule about Big Bad Government conspiracy theories, but in this case we have a paper trail and a confession:

The Nixon campaign in 1968, and the Nixon White House after that, had two enemies: the anti-war Left and black people. You understand what I’m saying? We knew we couldn’t make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.

John Erlichman, Assistant to President Nixon for Domestic Affairs, speaking to Harper’s Magazine in 1994

And nowadays of course you have the private prison industry in the US, which has threatened to sue several states if they legalize cannabis and thus reduce the prison population with its convenient supply of cheap labour and legal inability to vote. So in summary, the Proctor of Otago University has committed burglary against the community he is tasked with serving in order to uphold a legally-sanctioned societal prejudice known to be based on fifty-year-old racist lies. I would have joined in the protest if I could. Consider this my contribution.

Is the writing on the wall?

At the top of this page, for the last five years, my blog header has announced that my job is to take notes in lectures at the University of Otago on behalf of students with disabilities. This is still the case this year – but it may not be next year. I love this job and I want to come back to it as long as I can, but I’m not sure there will be anything to come back to. I think the University (not the Disabilities Office but someone higher up) is trying to stealthily disestablish my position.

In mid-2012 when I started working here, I was given nine lectures a week – nearly twenty hours of work, since I have to edit the notes after I’ve taken them. Then from 2013 to 2015 it was more like fifteen or sixteen classes, dominated by dentistry, over thirty hours. Not quite full-time, but enough to save money for a holiday in Japan. In 2016 the hours dropped off a bit and I started an expensive course of dental treatment and my savings carried me, narrowly, through the summer. But then last year the bottom fell out of the student enrolment for the service I provide. From fourteen or so note-takers the Disabilities Office went down to two, of which I was fortunate to be one. Most concerningly, every one of the students enrolling had been enrolled in previous years; not a single one was new to the service. This year I’m back down to nine classes and, once again, all the student names are ones I’ve seen before. Sorry, let me rephrase that. Once again, both the student names are ones I’ve seen before. I gather I’ll have a few extra classes from a couple of additional students, but not every week. Something has gone wrong.

Apparently, according to my supervisor, the University’s official position is now that we shouldn’t be providing notes for people who don’t absolutely need them, because no-one’s going to be taking notes for them out in the real world and they need to practise doing it for themselves. I’m still not sure how that translates to absolutely nobody new signing up for note-taking; I suspect, but don’t know how I could find out for certain, that the University has stopped mentioning the service in their marketing or at Orientation or wherever my clients used to hear about it before. That means that when my current students graduate and leave, I – like a couple of hundred other Otago service staff members so far – will be out of a job.

(The other option, as I’ve been reminded since I first wrote this post, is peer note-taking, which is when the University pays another student in the disabled student’s class a lot less than they pay me to hand in a copy of their own notes. This has helped me out on occasions when I’ve fallen ill and not had time to arrange a swap with another professional note-taker. But it’s not going to be the same quality as what I do, because they don’t have the training I’ve had, they mostly don’t have my typing speed, they won’t have developed a good system of digital shorthand like I have, and being busy students they don’t have the time I do to devote to editing. Also, I’m told – I can’t substantiate this – if the disabled student and the student note-taker don’t get on, it’s not unheard-of for the note-taker to do bad notes on purpose to hand in while keeping the more accurate version to themselves. Hiring professionals does make a big difference. Switching to purely peer note-taking would still constitute a huge downgrade to the service the University offers.)

I know, I know, mine is not a neutral viewpoint. As both an employee whose livelihood depends on this service and a disabled person myself, I am obviously not going to feel very good about this. But frankly, the University’s reasoning is bullshit. It’s the same tired justification that’s always trotted out for denying accommodations to disabled people: “Take away the crutches and they’ll learn to pull themselves up by the bootstraps.” Well, see, the thing is, those are actually rather apt metaphors, but not the way their users intend. Taking away someone’s crutches and pulling people up by their bootstraps both, if you were to demonstrate them literally, have the same effect: the victim falls flat on their face.

But isn’t one of the goals of education to allow people to integrate freely in society and thus live life to the fullest extent of their capabilities? Absolutely. But taking away accommodations does the opposite of that. It’s true that the world outside the tertiary education sector doesn’t have many note-takers, but I would venture to suggest that that’s because the world outside the tertiary education sector doesn’t have many lectures. Dentists don’t have to type for hours every day, but dental students do. The University’s new policy will mean there’ll be people who couldn’t follow their dream career in dentistry because they couldn’t type; which, given Otago has the only Dental School in the country, is a gross dereliction of duty.

Some disability advocates declare that disability is “socially constructed”. This is neither false nor nonsense, but it’s so misleading as to leave people less enlightened after they’ve heard it than before, unless they’ve taken a cultural anthropology course or similar and learned what this progressive-intellectual shibboleth actually means. It emphatically does not mean that disability is all made up. It emphatically does not mean that people are only disabled because everyone around them treats them like they’re disabled. In fact, it’s pretty much the opposite. Let me explain.

The word “disability” is often used as a synonym for “impairment”, but there’s a subtle distinction which is worth highlighting. Impairments are not socially constructed in any meaningful sense. An impairment is what you physically can’t do with your body that most people can, or can only do with great effort that most people can do easily. (I’m including your brain as part of your body, obviously.) A disability is what obstacles your impairment poses for you as you participate in society – as you work, as you study, as you socialize, as you consume entertainment, and so on. An impairment cannot be removed at will, or it wouldn’t be an impairment. To remove the obstacles to social participation that constitute a disability, society must accommodate impairments. People with impairments are disabled because society doesn’t acknowledge the impairments enough.

An example to make the distinction clear. Short-sightedness, long-sightedness, and astigmatism are all visual impairments. But only very severe forms of these conditions are disabling in our society, because the accommodations for the milder forms – eyeglasses and contact lenses – are accepted without question as normal. If your bank made you take your glasses off “so we can see your face properly” and then made you fill out forms in tiny print without them, then you’d be disabled. If you had to take them off to get your driver’s licence photo and then weren’t allowed to wear them while driving so law enforcement could match you to the photo, then you’d be disabled. If all eyeglass-frames came in one ugly, ill-fitting style, and the people selling them told you you should be grateful to have glasses at all, then you’d be disabled. If strangers and casual acquaintances came up to you in the street suggesting you’d be rid of the need for that contraption on your head if only you would try the new eye-strengthening course they’ve been doing (it’s called Sight Naturally, it’s based on ancient tribal colour lore, you never see the tribespeople in National Geographic wearing glasses, do you?), then you’d be disabled.

There’s a confusion here, by the way, which applies especially to mental and intellectual impairments. Lots of people say they’re in favour of helping people with such conditions. But when they say that, they’re picturing treatments which will wipe away the impairment and turn the patients “normal”. Failing that, they’d rather mentally impaired people disappeared behind institutional doors than be out and about on the street where decent people might bump into them (think of the children!) At a disabilities conference that I, yes, took notes for to earn a bit of extra cash last year, one speaker described dinner party conversations where she would mention that she worked in a mental health facility. “It must be hard keeping them contained. Was the woman who killed herself one of yours? You’d feel sorry for them if they weren’t such a drain on society.” Then she would reveal the truth – that she was paid to test the facilities in the capacity of a client. “Oh, but you don’t seem like you’re about to stab us!” “No, but the night is young.” The goal of mental health treatment, as of all disability accommodations, isn’t to turn the client “normal”. It’s to give them their life back.

From all this it follows that, if you remove a disability accommodation that was previously available, you are creating disability. You are disabling people who happen to have impairments. That stain will be on the University’s hands if my job disappears next year or the year after. I hope their lavish new landscaping project is worth it.

Meanwhile, I have the rather urgent concern of finding an alternative source of income. Because I’m disabled too. I’ve previously mentioned the social anxieties which make applying for work a terrifying ordeal for me. But that terror is upon me. The writing is on the wall.

Oh, the humanities

My employers’ employer, the University of Otago, has decided to cut staff positions in the humanities. Music is going to be hit the worst. As usual, the justification is money. It’s been suggested that maybe the University should ease off on its endless construction drive if it needs to free up some cash. (In twenty years I’ve never known the campus be without a big hole in the ground somewhere. Face it, Otago, the Richardson Building is a plug-ugly wodge of concrete and no amount of landscaping around it is going to change that.)

However, this wouldn’t fix the bigger problem, which is the government’s attitude. Statements from the Ministry make it clear – education is for fitting young people for the workforce; anything else is an indulgence. Here’s the official position in their Tertiary Education Strategy.

Skilled, knowledgeable individuals are essential to the success of businesses and other organizations. Access to skilled workers allows businesses to increase the value of their products and services and to pay higher wages. In turn, people are better off, healthier and happier, and New Zealand is a more attractive place to live and work.
For most young people, achieving a tertiary qualification is a crucial milestone towards a successful working career. Whether they study at a university, polytechnic, wānanga, private training establishment, or through an apprenticeship, a qualification gives them a concrete record of knowledge learned and skills gained that they can use to move up the employment ladder.

And in the Minister of Education’s own words, prefacing that document:

The new Tertiary Education Strategy 2014–19 has been developed to... contribute to the Government’s focus on improving New Zealand’s economic outcomes. The “Building Skilled and Safe Workplaces” programme of the Government’s Business Growth Agenda aims to materially lift New Zealand’s long-run productivity growth rate while maintaining our high rate of labour force participation. This requires tertiary education to better equip individuals with the skills and qualifications needed to participate effectively in the labour market and in an innovative and successful New Zealand.

Sure enough, Priority 1 in the Strategy is “delivering skills for industry”. There is nothing anywhere about developing insight or critical thinking. Public education, to this government, is solely a means of polishing up new cogs to slot into the commercial-industrial machine.

My instinctive response to this is a string of expletives, but that’s not the way to build a counter-argument. If you want rational debate, start by taking your opponent’s concerns seriously. Education costs society money; don’t we then have a responsibility to pay that money back? Granted that some people derive personal value from knowing all about, say, the anti-imperial politics encoded in the Book of Revelation or the practice of cannibalism in indigenous South American funerary rites, shouldn’t they stump up their own cash for it?

How to pour money down the drain

Ever commit yourself to something and then regret it? I’m starting to feel that way about this blog post. I realized something, you see, for whatever that’s worth, and I thought I might share it. But in order to explain it I first have to go over basic economic theory. Only, some people who are close to me in their politics have a very different economic theory, which doesn’t yield the same insight. So I have to start by explaining the two theories and why I think the first one has more explanatory power, and then I have to show that, although politics like ours traditionally uses the second theory, it doesn’t need it. I would rather just skip ahead and tell you my idea, but it doesn’t make sense if you haven’t sat through a few economics lectures. So here goes.

Where does profit come from? Capitalist economists explain with the trade theory. Suppose your old car is getting elderly and taking up space in your garage. You reckon that if someone nicked it you’d only be down $2500 all told. At the same time, I need a car for my work, doesn’t have to be flash or new, but I figure even an old banger will easily net me $4000 with the use I can make of it. So I offer you $3000, which is $1000 less than what I’m expecting to gain. You take it, because that’s $500 more than the car is now worth to you. This is what’s called a “positive-sum interaction”. You gain $500 in cash, and I gain $1000 worth of car. A total of $1500 has appeared out of nowhere. This $1500 is “surplus value”.

Economists apply this theory to all kinds of transactions, including labouring for a wage. The labourer is the seller and the employer is the buyer, and obviously the wage must be worth more to the worker than their time or they’d quit, while the labour done in that time must be worth more to the employer or they’d lay the worker off. Karl Marx disagreed. Goods don’t appear out of nowhere. Goods are made from raw materials when labourers put labour into them. Therefore, the labour is the source of the surplus value (measured as the price of the product minus the cost of the materials), and the labourer is the rightful owner of that value. According to the labour theory, an employer who then takes away the goods, sells them, pockets the profit, and doles out a fraction of it back to the worker, is nothing but a thief.

Which theory works? Another parable. Mr Miggs runs a back-shed factory making plastic coat-hooks that you can stick on a door. He sells them at $5 for a packet of three, but his cost to make those three, including labour, is only 50c. According to the labour theory, he’s robbing his staff of $4.50 per unit. But one day Mr Miggs buys a 3D printer, an automatic packet-sealing machine, and some drones to carry things around the factory. He sets up an automatic e-mail system to alert his courier when there’s a shipment ready. In short, Mr Miggs automates his process totally, and lays off all his employees. He can now make his coat-hooks at a cost of 10c per unit. He drops his price from $5 to $4.80, which raises his sales by 2%. Not only is he selling more units, but his profit per unit has gone up from $4.50 to $4.70. The trade theory easily accommodates this scenario; the labour theory boggles. Whose labour is Mr Miggs exploiting? Where is that $4.70 coming from?

Score one for the trade theory. But I would have to query whether Mr Miggs’ staff, back when he was employing staff, were genuinely free agents. When your only choice is between two bad alternatives (such as: break your back working for peanuts, or watch your children starve), then technically you could count as a gain the advantage that the lesser evil holds over the greater, but that seems awfully sophistical. If someone mugs you for your wallet, they get your money and you get to stay alive – it’s a win-win! The higher the stakes are for you, the smaller your bargaining power. The outcome might well be positive-sum, but if you can’t realistically negotiate your share of the benefits, they’ll be massively skewed in the other party’s favour. That sounds like exploitation to me.

Actually, “the higher the stakes” is not a good way of putting it. A speculator might lose millions in a day in a derivatives clearinghouse, whereas a drain-layer begging for a raise is only dropping a few hundred a week if their employer decides to fire them instead. That doesn’t mean the speculator is in direr straits. What constrains your bargaining power is how much you’ll be left with if things go sour. Back when I was taking my first semester of economics lectures, I wrote a post about what I saw as the major problems with economic theory as it is taught to university students. If I were writing it now I might moderate my tone in places, but I would not make any substantive changes. And the main point of that post is the proportionality issue I’m talking about here: some people can better afford to lose millions than others can afford to lose hundreds.

Now my realization is about the destruction of value, which the labour theory also doesn’t account for. If value can come out of thin air, it can also vanish into thin air. A simple example might be if you were competing with yourself. If that sounds like nonsense, think of professional sports. Their revenue comes from two sources: stadium seats and television ratings. These two are in direct competition with each other. The more people watch from the sofa, the emptier the stands are. Some portion, at least, of the advertising for either one shifts revenue around instead of increasing it. The money spent on that portion of advertising might as well be dumped into a shredder.

Bring back free education

Recently, for the first time in my life, I considered voting for the New Zealand Labour Party. Oh, they’ll have to smarten up a long way if they want me to do more than consider. The Greens are still far and away the best option on the table. But after a thirty-two-year love affair with neoliberalism, Labour are finally returning to the sort of policies that a Labour party ought to be built around. They’re offering free tertiary education.

Well, to a very small and limited degree compared to what everyone in this country had until 1989. I would be remiss if I didn’t mention that Labour were the ones who first charged students fees for their education. The National Party were elected in 1990 on a promise to remove those fees, which they did – and then cut funding to universities and polytechs so that they were forced to charge much higher amounts to stay afloat.

When I started university in 1996, paying for education was still a new and shocking thing. Many families had been blindsided, with no chance to save up for it, so we all had to borrow massive amounts of money to get through, and that became the norm. National set up the student loans scheme, which has become an ever bigger asset on the government books with each year since. We student activists fought back with marches and occupations and letter campaigns and various other tactics.

In 1999 we sent delegations to every political candidate meeting in town, not to disrupt them in any way but to make sure that education always got a mention at question time. That, along with the protests, helped push education from #6 to #2 in the “issues of concern” polls, and I think that had, well, more than a negligible effect on the election that year, when National was voted out and Labour in.

Issue #1 was taxes. National MPs went about that year with tears in their eyes for the skilled youth of New Zealand, who were apparently leaving in droves for other shores due to financial hardship induced by taxes. They called it the “brain drain”. I was one of quite a few people, I think, who pointed out to them that student loan repayments were a bit more oppressive, and a bit more specific to skilled youth, than taxes. I had the satisfaction of flummoxing Bill English with that one.

Apparently National did take heed, because now that they’re back in office they’ve introduced legislation – such is National’s compassion for skilled youth in financial hardship – to detain people who go overseas and skip payments. Obviously they can only do that when the people come back to visit, and a couple of weeks ago the law claimed its first victim.

As if to demonstrate what neoliberalism does to a culture’s soul, the first comment on my Facebook feed was “No sympathy for the dude who didn’t pay his student loan.” The general feeling of the conversation was that if we have to work so hard to pay for our education, then how is it fair that some people get it handed to them for free by swanning off overseas? There have been similar remarks about Labour’s proposal. I guess I can understand that. But I think the indignation is misdirected.

A plague o’ both your houses

Years and years ago, I earned a bachelor’s degree in cultural anthropology. I thought at the time I might end up in academia, but graduate study didn’t work out. This past couple of weeks, I’ve taken a couple of sociology lectures for another note-taker who was away. Most of my classes in the last three years have been in dentistry or other clinical sciences, so I found the sudden familiarity a little jarring, like Temuera Morrison’s New Zealand accent in that Star Wars prequel. And kind of embarrassing, actually. Blimey (I thought), we humanities students really think we’re all that, don’t we?

Lest you think I’m solely ragging on sociology: last semester, I took one of the two weekly lectures in an economics paper, to which I had much the same reaction, although there it was more comfortable because, as a former humanities student active in politics, I have a long-established habit of looking down my nose at the Commerce Division. And Health Sci too, now I come to think about it – “medicalization” is a favourite tut-tut word in certain academic circles. Well, Commerce deserved it, Health Sci didn’t, and we in Humanities really weren’t holding the high ground we thought we were.

Let me try and explain what it’s like. When I was a kid, one of the many books knocking around our house was a shabby little paperback from about the 1960s entitled “100 puzzles for kids” or something, and I remember it because it actually had 101 puzzles but the last one was a trick one that didn’t have a proper answer. A hotel has fifty rooms, and one day fifty-one people turn up wanting accommodation. The hotelier thinks for a bit. He puts the first guest in the first room, then takes the second guest aside and says “If you could just wait here while we get this sorted out.” Then he puts guest number three in room number two, guest number four in room number three, and so on until guest number fifty-one is placed in room number fifty and the hotel is full.

Now this was one of the first hints I had that my brain doesn’t work quite like other people’s. According to the book, most people are bamboozled – they know there’s a flaw somewhere, but they can turn it over and over in their heads for hours before they suddenly go “Of course! The second person hasn’t got a room!” But to me, reading the puzzle, it was so obvious that the second person hadn’t got a room that I turned it over and over in my head for hours wondering what the mystery was supposed to be.

In economics and sociology, it’s not a guest who hasn’t got a room; it’s a foundational concept that hasn’t got a basis. You introduce that concept, and proceed to derive the rest of the course from it. It becomes a sort of base-camp assumption for the students’ thoughts, like mass-energy conservation for physics students or Darwinian natural selection for biology students. By the end of the first semester, it’s become so familiar that they assume anyone who questions it is simply ignorant.