Monday, July 11, 2016

Some More Historical Glimpses of Clement Attlee

Here he is talking before the UK general election of 23 February 1950:

In this election the Labour party won 1.5 million more votes than the Conservatives and received more votes than in the 1945 election, but owing to the first past the post system only won a majority of 5 seats.

A priceless anecdote from David Hunt, Private Secretary to Attlee:


  1. LK
    i want to go really offtopic since i thought about something right now and i think i can make a case for my labour subsidies theory (if you remember it) its of course related to technological unemployment.

    (i admit that i had an inspiration from one really famous classical economist)

    if we are thinking about that deeply if robots ai and software will make most of the work in the world and humans will do nothing we will actually lose productivity why?

    since when humans do nothing its a labour wastage (and its may be a huge one even if almost everything will be automated).


    because if for example we will put all the people on basic income guarantee scheme (to maintain demand since otherwise capitalism will collapse) and tell them you can buy whatever you want with the income you get it will not solve the real capacity constraints on natural resources and machinary so in this case when you put all people on basic income guarantee.

    what will happen is that capitalists/investors/entrepreneurs will buy only automated machinary software and etc and (since its get the absoloute advantage).

    but there is an economic problem with that and is that there is limited capacity to create automated machinary software and etc (if we assume proper demand management which in turn create really high capacity utilization).

    but if we will subsidize labour (with right policies of course) until full employment achieved (with central bank money) instead of putting people on welfare.

    what will happen is that the same capitalists/investors/inventors/entreprenuerswill invest in automation in the most productive sectors instead of investing in all of the sectors in the same time (or at least automation will be complementary and not a substitute the workers entirely).

    we will assume that there is 2 professions lets say factory workers and fruit pickers

    now if you put people on basic income guarantee capitalists will buy only automated robots (since they have absoloute advantage)

    but if you will subsidize labour until full employment achieved humans will able to take part of the jobs which done by automated capital,this in turn will release real capacity for investors to invest in capital in other industries which will increase the total capacity of the economy.

    (yes its somehow about making comparative advantage of ricardo to work properly).

    how is my idea to you?

    1. Interesting, but I think people would get very resentful if forced to do work that could be done easily by machines.

      Rather, the work and employment programs created by the government should be in work that cannot be done by machines or which cannot be properly done by machines.

  2. well i am not sure about that LK

    for example i know that many american citizens in the rust belt would happily get their manufacturing jobs back even though chinese workers can produce this products more efficiently and cheaply.

    but on the other hand if we assume that the most efficent allocation of people is in lets say mcjobs even if they will get good payment and salary they will not be that much happy you are right about that.

    so how about subsidizing labour intensive jobs which make people feel dignity by working at them lets say engineering jobs doctors or labor intensive factories or teachers (with good labour conidtions of course) maybe you can do that by doing extensive surveys or something.

    so in this case the economy anyway wins since you have to do demand management anyway and this people will in this case add to productivity by working in respectful jobs in which they will gain dignity (and keep social mobility in the economy) and you freeing real resources to produce capital or use the computing power of the AI in other sectors which people will not like to work.

    of course i am speaking about a situation where the possibility to automate most of the jobs exist anyway.

    how do you think about that?

  3. LK,

    To what extent do you think the experience of the Great Depression and World War II allowed the creation of social democratic or similar systems in the West?

    I was thinking about this after debating my right-wing uncle about why British people voted for Labour in 1945. I really think that the experience of the Great Depression and the war created in the minds of the vast majority of the people a strong unwillingness to return to a relatively more laissez faire system of capitalism. The war also proved that government-directed systems were capable of great feats and the collective experience of the war involving people from every class background working together to defeat fascism created more solidarity within society.

    My theory is that without major collective experiences post-WWII, people became more individualistic and were more easily swayed by right-wing arguments of the type peddled by Reagan and Thatcher. Also, people saw the capitalist Golden Age from about 1947-1973 as the natural state of capitalism and forgot just how much influence government policies and strong labor unions helped in creating "middle-class" societies.

    This is why I am confused by conservatives who want to go back to the social conditions of the 1950s (stronger families, better jobs for the majority of the populace, less immigration) yet they support neoliberal policies that are very different from the types of policies that fostered the capitalist Golden Age.

    1. You are confused that people disagree with your conclusions about the consequences of policies? This sounds like someone who doesn't even try to understand anyone else's argument.

    2. Tiberius

      Is less about the war and more about the great depression its took the old neoclassicals out guard and their execuses dont worked anymore
      So they had to accept keynesian policies

    3. Ken B,

      I am confused because social conservatives support policies that undermine the very things they want. How do low wages help people build strong families? It is clear that the social conditions of the 1950s and 1960s were a product of government policies favoring things like mass homeownership and support for full employment and the "breadwinner" model of male employment, not to mention the role unions played. Not exactly laissez-faire capitalism, which so many of these conservatives wax on about.