Archive for January 4, 2010

Professor Gordon: You have been served!

January 4, 2010 Leave a comment

In the interest of calling to account a field of scholarship which absolutely refuses to police itself, Re: The People is following up on Tom Walker’s recently renewed challenge and specifically identifying those members of the Economics field who persist in spreading a distorted and deliberately misleading statements about hours of work reduction.

First on this list is ROBERT J. GORDON, Professor, Social Sciences, Northwestern University

According to his bio, Mr. Gordon is Stanley G. Harris Professor in the Social Sciences at Northwestern University. He is an expert on inflation, unemployment and productivity growth. His recent work on the rise and fall of the new economy, the revival of US productivity growth, the stalling of European productivity growth and the widening of the US income distribution have been widely cited. He is a Research Associate of the National Bureau of Economic Research and a member of its Business Cycle Dating Committee, a Research Fellow of the Centre for Economic Policy Research (London) and the Observatoire Francais des Conjunctures Economiques (OFCE, Paris).

Mr. Gordon, has alleged, without offering a single shred of evidence, that supporters of shorter working time believe that hours of work should be reduced because there is only a fixed amount of work available. According to Mr. Gordon,

Forcing employees to work shorter hours as a way to create jobs is known as the “lump of labour fallacy” and dates back to Herbert Hoover.

Mr. Gordon has placed on record a fact: Sometime during Herbert Hoover’s administration, a person or persons advanced the idea that hours of work should be shortened because only a fixed amount of work was available.

The lump of labor fallacy has been previously defined by Paul J. Samuelson, in his textbook, Economics (pages 575 and 576 of the ninth edition), in the following fashion:

“There is a … powerful reason why workers fight for shorter hours. They fear unemployment: they tend to think the total amount of work to be done is constant in the short run … This attitude, that there is only a fixed amount of work to be done, is sometimes called by economists the ‘lump-of-labor fallacy.’ We must give this notion its due.

“To a particular group of workers, with special skills and stuck in one region, the introduction of technological change may represent a real threat. Viewed from their personal standpoint, the lump-of-labor notion may not be so fallacious. True enough, in a great depression, when there is mass and chronic unemployment, one can understand how workers generally may yield to a lump-of-labor philosophy. But the lump-of-labor argument implies that there is only so much useful remunerative work to be done in any economic system, and that is indeed a fallacy.”

In the view of Paul Samuelson, in other words, the lump of labor fallacy is not a argument at all, but a naive belief produced by fear of permanent unemployment which Samuelson alleges to exist among the section of society that is utterly dependent on work for its survival.

For decades Samuelson presented no evidence that this was true – that such a belief exists. And, indeed, there is no evidence, since American workers first raised the demand for shorter hours of work in 1822 when the US economy was expanding rapidly!

Mr Gordon, however, has taken it beyond this alleged fear said to exist among working people and posited it as a argument underpinning the call for shorter hours itself which supposedly emerged sometime during the Hoover administration.

We insist he give evidence that this argument ever existed, and that its emergence can be dated in the fashion he gave.

As a respected professor of a major university, and associate of a number of widely respected institutions, we believe it is incumbent on Mr. Gordon to produce evidence to support his case in this matter. Absent the presentation of this material, we question the validity of his research on matters of unemployment, productivity growth and inflation, as the problem of hours of work is connected to all three subjects. In short, we think his work is misleading and even deliberately designed to obscure the causes of these issues.

(edited 1/4/10)

More anger from progressives…

January 4, 2010 Leave a comment

David Michael Green on the Obama Presidency:

I can’t even begin to describe how insulting Obama conducting a “jobs summit” is to me, or what an unbelievably ham-fisted piece of public relations that was for the White House, which is increasingly showing itself not just to be sickeningly regressive, but also fully inept. I think I speak for a whole lot of Americans when I say that, one year into his stewardship over a destroyed economy that was actually atomizing for at least six months before inauguration day, I don’t want my president sitting around a table, running a dog-and-pony show, pretending to kick around ideas on how to generate jobs. I wanted him to have those ideas, himself, before he was inaugurated. I wanted those to be real ideas, that produce real jobs for real Americans who are really hurting. I wanted that to be, and still be, the be-all and end-all of his presidency, not some distant fourth-place priority, behind healthcare and the White House dog selection process. And, especially not some fourth-place priority behind jive healthcare reform.