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  • The Hayekian epiphany about the price mechanism is not wrong, but incomplete. Market prices of goods and services are indeed a more powerful informational device than any central plan. But the crisis showed the same cannot be said for the prices of assets.

    If the five-year plan was the Soviet bloc’s grand lie, here is that of capitalism: that the market values of financial and other assets accurately reflect the economic value they represent.

    What happened 10 years ago this month was the horrifying realisation that financial claims accumulated over the previous boom years did not add up, that the future economic production which they were claims on was insufficient for them all to be honoured in full.

    In brief, the wealth that people thought they possessed did not in fact exist. When enough people saw that their perception of their wealth was untrue, the system unravelled. The disorientation and distrust that have followed in both markets and politics was just what one would expect when millions realise they have been living a lie.

    One lie spawned another, as market liberalism, in its turn, betrayed the dream it had promised. Western economies are today far poorer than the trend before the crash predicted. The crisis and its aftermath have left the young, in particular, with little reason to hope for the same opportunities to prosper as their parents and grandparents…

    Those who want liberal democratic capitalism to thrive again must heed two lessons from this comparison.

    First, a social system can survive disillusion for a long time. Communism showed this; as indeed does capitalism, whose promise was broken decades before the crisis for some groups. But when people can no longer count on their livelihoods, support snaps. Even so, the most resilient societies are those that know the truth about themselves. Deceit makes for brittleness. Market liberalism is in peril because its financial system allowed us to tell ourselves lies; and did not reckon decisively with the losses once they were undeniable.

    Left and right populists traffic in nostalgia for the heyday of the mixed economy. They are right that the contest between planning and laissez-faire must be resolved by a mix of the two. The biggest lesson from that contest is any social and economic system must be kept honest — not just fair, but truthful. And that’s a radicalism the populists are singularly unqualified to provide.

    tags: communism capitalism delusion lie propaganda market marketfailure price economics politics policy publicpolicy publicopinion MartinSandbu truth honesty

  • tags: India-history India-politics regret racism intolerance religion fundamentalism Nehru NarendraModi PankajMishra 2017 anniversary inequality injustice Kashmir violence

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  • What causes people to be racist?

    “In some ways, it’s super simple. People learn to be whatever their society and culture teaches them. We often assume that it takes parents actively teaching their kids, for them to be racist. The truth is that unless parents actively teach kids not to be racists, they will be,” said Jennifer Richeson, a Yale University social psychologist. “This is not the product of some deep-seated, evil heart that is cultivated. It comes from the environment, the air all around us.”

    Richeson compares children’s instinctive formation of biases to a student at a new school. “When you arrive at a new high school. You are instinctively trying to figure out who’s cool, who’s not, who’s a nerd, who gets beat up? Kids quickly acquire these associations,” she said.

    To get a sense of just how pervasive and imperceptibly our environment can affect us, one study at Tufts University found that even with a TV show on mute displaying scenes with no explicit discrimination, the nonverbal body language of black and white actors interacting was enough to cause watchers to test higher for implicit bias afterward.

    “An us-them mentality is unfortunately a really basic part of our biology,” said Eric Knowles, a psychology professor at New York University who studies prejudice and politics. “There’s a lot of evidence that people have an ingrained even evolved tendency toward people who are in our so-called ‘in group.’”

    When does racism drive people to commit violence?

    “The most likely predictor of that is exposure to a kind of ideology,” Knowles said. Most if not all people carry implicit biases and unexamined prejudices, he said, and some may harbor feelings of fear or resentment that they don’t express in public.

    “But when people come into contact with an organized ideology that valorizes or glorifies an intergroup struggle like a race struggle — that scaffolds from people’s everyday prejudices into something altogether more violent,” he said.

    White supremacist groups promote a “siege mentality” among their followers, Knowles said — rhetoric that aims to lend legitimacy to people’s racial and ethnic fears. He pointed to the slogans shouted by participants in the Charlottesville rally: “You will not replace us” and “White Lives Matter.”

    Can you teach people not to be racists?

    “The only way to change bias is to change culture,” Richeson said. “You have to change what is acceptable in society. People today complain about politically correct culture, but what that does is provide a check on people’s outward attitude, which in turn influences how we think about ourselves internally. Everything we’re exposed to gives us messages about who is good and bad.”

    Knowles agreed that norms can serve as a check on expression of violent racism. But to challenge the deep-seated prejudices that shape our behavior, to unlearn our implicit biases, “we need contact,” he said.

    “It’s absolutely the opposite of what white nationalists want, which is a segregated society,” he said. “We need an integrated society, and at the same time need to create as much socioeconomic fairness as we can, so what relationships people have across group lines are egalitarian relationships. … That’s the one thing that can create trust between people on each side of an us-them divide, and the only thing in the long term I would put my money on to reduce prejudices.”

    tags: racism education children culture schooling parenting USculture research psychology prejudice bias

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Posted from Diigo. The rest of my favorite links are here.

Posted from Diigo. The rest of my favorite links are here.

Posted from Diigo. The rest of my favorite links are here.