Jason Hickel doesn’t understand economics | Tim Worstall

It’s possible to wonder why the anthropologist Jason Hickel is a thing. My answer is — it’s as a warning. Do not step off one’s own knowledge base and then make pronouncements on the bits you don’t know will kill your claims. 

I’ve long been rather fond of Hickel’s idea that the first few centuries of capitalism plunged the world to sub-subsistence incomes, with people only returning to the joys of well-fed medieval life when socialism started all that redistribution in the 20th century. We could cavil and point out that actually existing socialism never offered especially appealing diets. But the real point is that this is abject nonsense. 

Subsistence means that two adults can afford to raise two children to adulthood, who can then go on to do the same. That’s the definition of it — as Hickel acknowledges. That means that if we had several centuries of below subsistence human existence then, and therefore, we must have had several centuries of falling population. This is an explicit result of the claim — and as we didn’t have falling populations then the claim is nonsense. Another paper of his made that same claim in detail about Britain — about a century in which the population tripled from 10 to 30 million and we exported another 10 million as well.

That is, he’s claiming things that cannot possibly be true and which anyone with any background knowledge at all – below subsistence incomes meaning falling populations is not hard – would immediately see are nonsense. 

So reverential interviews like this at Novara Media are somewhat puzzling. There are the usual political claims, like that we’ll get 3°C of warming this century which, as I’ve proven, we won’t. But then no one has to believe me either. There’s this appalling piece of idiocy:

Renewables are now about 50% cheaper than fossil fuel gas. And yet the transition is not occurring at the necessary pace, right? Why is that? It’s because capital does not in fact care about the price of energy. It cares about profitability, right? And so fossil fuels despite being more expensive are three to four times more profitable than renewables. So therefore uh capital continues to invest massively in producing fossil fuels

That’s the sort of thing that sounds just great — even groovy — after the fourth bong hit. But come on — we’re all professors and professionals now, not students. Given that electricity, however produced, sells at the same price then the thing that is cheaper to produce makes a greater profit. There are no exceptions to this. How could there be? Any contortion that has to be made to make the cheaper product to make the less profitable product has to end up proving that it’s not, in fact, the cheaper product. It’s just weird to try insisting otherwise.

But the real warning is in this:

Growth defined by economists, which is what we’re talking about here, is a very specific thing which which is an increase in total aggregate production in an economy as measured by market prices.

……

So, GDP I think we have to we have to start with this problem which is that it’s ultimately a metric that measures what is valuable to capital right and not what is valuable to humans to say nothing of the planet.

The first part of that is correct — GDP is production (or incomes, or consumption) at market prices. Well done — Hickel is able to read a definition. But he then goes on to wholly misunderstand what that means. 

Firstly, of course, there’s that usual mistake of thinking that there’s some organism or purpose to “capital”. Sorry, Marxists of all stripes — there’s no such thing. There are individuals and collectives who have capital, sure, but they’re all fighting like rats in a sack for access to the profits to be made from consumers. Or, if you prefer, from oppressing labour. Even Marx, K, got that right, with the warning against monopoly capitalism — something that does not, as yet at least, exist.

But the much greater error is in not realising what “at market prices” means. As I explained before, such things as “New Coke” prove that the capitalists don’t get to determine what is produced. Consumers do — by their buying, or not buying, what the capitalists try to produce. This is why market prices are that determinant — if consumers won’t buy at a price which makes the capitalists a profit then the capitalists won’t make it. This is proof, again, that it’s consumers that decide.

Hickel several times makes the usual complaint about fast fashion. This is so obviously a waste of resources that should be put to solar panels, or affordable housing. That is, the anthropologist has failed to note that at least half the species likes dressing up and looking pretty — or that a substantial portion of the other half balk like watching the process. This, for an anthropologist, is a pretty big failing.

This is the use of Hickel — an example of the dangers of trying to pontificate outside your field

Hickel’s economics is wrong because he doesn’t have the base, the footing, in the subject. He cannot see that below subsistence wages means, by definition, a falling population. That if it is market prices which determine GDP then — again by definition — it is what consumers are willing to pay that determines production. What gets produced is thus what consumers value, not what capitalists wish to profit from — even capitalists only produce what consumers demand at a price that will profit the capitalists. Hickel’s complaints about what is produced are therefore whinges about humanity, not the economic system. But as he doesn’t grasp these basics — opining too far off his knowledge base — he charges into gross errors.

This is the use of Hickel — an example of the dangers of trying to pontificate outside your field.

Of course, there’s also that little problem of what happens within his field as well. An anthropologist ignorant of the idea that the ladies tend to like dressing up? Well, there’s a thing, eh? 

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