Humanity is richer than it has ever been. We live longer than we ever have; people have access to an endless supply of culture, knowledge, and consumer goods, all from a small device in their pocket. So why are we all so pissed off all the time?
That’s the question political economist Mark Blyth and hedge fund manager Eric Lonergan tackle in their recent book, Angrynomics, which examines the economic roots of rising personal stress and growing popular anger. Blyth and Lonergan look at the transformations of our daily lives and the larger economy over the past 40 years, from the deregulation of finance to the rise of big tech, and explain why these steps that have added to GDP have come at the expense of personal stability. What’s pitched as bringing flexibility and dynamism to the economy has translated into constant economic uncertainty for most people, which breeds anxiety and stress, and thus anger.
GEN recently spoke with Mark Blyth about assumptions that have been made about economic theory and how it’s making our lives unbearable.
Alex Yablon: Can you explain the connection between private anger and political anger, between micro- and macro-angrynomics?
Mark Blyth: When I was finishing up the research for a book on austerity I did a few years ago, a bunch of research started to come out by economists looking at the relationship between violence and economic crisis. There’s been a lot of work by political scientists about civil wars and violence and stuff like that, but the way they linked it was very interesting.
What you’ll find is that big financial crashes in the private sector tend to produce right-wing violence and right-wing political movements. The right are the ones who basically weaponize anger in politics, right? The second part of it came down to a conversation Eric and I had, where he was talking about when he first trained as a labor economist. It was all about flexibility and making markets more efficient. He stopped and said, “You know, the whole time I was doing that degree, no one once ever said, ‘Is this any good for the people involved?’”
Honestly, this book comes from a deep insight from being brought up a rather strict Catholic, quite seriously. What Catholicism does and what economics does is kind of act as dogma. The point of dogma is to remove doubt, because where there is doubt, to quote Yoda, there is fear. What humans hate is fear, which is generated by an uncertainty that you can’t control.
So, what is it that political ideologies do? They banish fear. They give you certainty. What is it that everything from the convention of marriage to bar mitzvahs to central banks do? They’re institutional attempts to engineer your world in such a way that you can reduce uncertainty to a problem of risk.
Now, what have we been doing to people for the past 30 years? We’ve been taking that risk from corporations and governments and handing it to them and saying, “You fucking deal with it.” When you think about zero-hours contracts, when you think about digital platforms like TaskRabbit and Uber, when you think about the consequent skewing of income and wealth, the way taxes have been re-engineered for the benefit of the top 20%, you fragilize the ability of people to control the degree of uncertainty in their lives. If you add all these things together — big financial crashes, technological changes, and this upswelling of uncertainty, which becomes unmanageable — then you will produce a shit-ton of anger.
Economists have modeled humans as “representative agents.” We’re supposed to be, as you say, “ageless, sexless, tasteless, non-ideological, and… live forever.” Is this because it’s just hard for economists and politicians to figure out how to integrate things like gender or awareness of mortality into economic models? Or does this flattening of people’s experience actually serve a purpose?
You can adopt something because it’s a convenient modeling contrivance. And then when the world, for a while, conforms very closely to your models, you can convince yourself it’s no longer a model but reality. Therefore, anything that deviates from reality, by definition, has to be in error. But it can’t be a model error, because the model doesn’t generate error. It has to be the people.
Here’s one way to think about this: What’s the number one occupation of people who end up on trial in the Hague? Engineers and science teachers. They like very ordered worlds, closed systems with known parameters that you can go in and fix. If you take that type of approach to big, complex, open, and entropic dynamic systems like human economies, then bad shit happens. You don’t immediately come back and say, “Hey, there must be something wrong with my whole way of thinking.” You say, “No, those people aren’t trying hard enough,” or “Those people are the error,” or “Those people are the problem.”
Are people with levers of influence over the economy adjusting their thinking?
I think they already have. The problem is the political constraints allowing them to express it publicly. Look at someone like Claudia Sahm, who’s worked in both Treasury and Fed. She has a proposal called the Sahm Rule: In times of recession, you just give unconditional cash transfers to households. Helicopter money, straight from somebody that sat in the Fed and worked in the Treasury.
Every big central bank is working on central-bank digital currencies. Why? Because we don’t want to go through that crap of trying to mail people checks again. That’s the real politics. To me, the politics of the CARES Act was deliberately choosing checks, because you knew that you would be able to bail out the airlines in 24 hours but you would miss 25% of the people because checks are such a 19th-century technology. Instead, you could have central-bank digital payments, and you could tie them to people’s bank accounts and then just wire $1,000 into their accounts every month until the pandemic’s over. For that to happen, you would need people who run Congress to want that to happen. And they absolutely do not want that to happen.
It’s not just job losses and declining wages that make people angry — the experience of work has also grown more infuriating. Even if you get paid well, your job is precarious. To advance, you often have to leave for a different job, which is risky. As technology insinuates itself more into work, there’s a lot less social connection on the job and a blurring of the line between work and home life. What is driving these increasing daily aggravations?
Most of the value, most of the share price, most of the capture from intellectual property rights happens in a handful of firms and a handful of sectors. They’re the superstar firms. The superstar firms like Apple earn most of the profits. They never end up back in your home economy, because of creative accounting and tax dodges. Then they have a handful of major suppliers like Foxconn or Corning Glass. Those suppliers employ a lot more people than the core firms, though they earn a lot less money. But they still earn decent profits, because they’re directly tied to Apple.
Everybody else in the assembly process, the market, and the distribution is living on crumbs, in terms of profits. Everybody works for layer upon layer of different subcontractors, and the way each of these guys is making their money is by squeezing labor and paying as little as possible because there’s no other value in the supply chain.
The vast majority of people are working for firms that couldn’t pay them more even if they wanted to, because their margins are absolutely tiny. What do you think your employment relationship is going to look like? If you’re cleaning a hotel, you’re wearing an ankle bracelet to make sure the hotel can monitor exactly how long it takes you in every single room. Working as a bank clerk used to be a middle-class occupation. Now, in the U.K., you get stories all the time about bank clerks heading to work only to get a phone call that their hours have been canceled for the day. How do you possibly organize childcare in that type of economy, right? So, all the power is with capital, all the tech is with capital. That’s what’s fragilizing — not just our labor markets, but our experience of work.
I was a kid in the 1990s when a lot of these technologies that now run our lives were first coming into widespread use. Back then, the expectation was that the internet and the computer age would make things a lot easier for workers. Do you think there’s a world where these technologies could have made good on that promise?
I think it’s a mistake to blame technology. You can put guardrails around things; you can put regulations in place. You can do very simple things that could be very pro-capitalist. Right now, the way to capture value in the modern capitalist economy is to get control of an asset and put up high barriers to entry, and then make everybody pay user fees. That’s rent.
One example of this is Uber. The technology is relatively simple: It’s a GPS and a matching algorithm. How about cities just pass a law that every municipality has the right to load onto your phone their local version of Uber? You can then share the profits from the system with all the drivers instead of giving it to a monopoly. Why do we have to give all this money to Uber, a company that doesn’t even make any profits?
What’s the relationship between angrynomics and millennial burnout? Why does the economy make some people angry and others just exhausted?
It’s what happens to you when you’re not poor enough to have deaths of despair — if you have sufficient resources that you can actually live in Brooklyn, juggling three jobs. You are stressed out all the time, in debt, you’ll never pay back your student loans, and your wages don’t seem to be rising. You look at the generation above you—they’re now 50 years old, they did okay. The generation above them, Trump’s generation, they don’t give a damn about you or your generation, as evidenced by their stance on climate. You wonder if it’s all worth it and whether you shouldn’t just sell up and go open a B&B in New Zealand.
That’s a completely rational response, right? The difference is you’re not in a completely de-industrialized, defenestrated town in the Midwest, where the only employer is now Walmart, everything is shut down, everybody’s on drugs, and if they’re earning at all, it’s 10 bucks an hour. If you’re above that, you’re entitled to millennial burnout.
Biden is campaigning on relieving our national anger. But he has also rebuked those to his left who want to deal with the structural drivers of anger you described in the book. Going by the polls, it looks like his pitch is working. If he governs with an eye toward returning to “normalcy” above all else, can a Biden administration calm the national temper for long?
My totally unscientific subjective analysis of the situation is that Americans are exhausted from being angry. Biden’s saying, “We’ve had enough. Go with Sleepy Joe and have a nap.”
But there are a huge number of non-college-educated white guys in this economy, 40 million of them, who don’t trust the Democrats as far as they can throw them. When I talk to working-class friends about what they think about the Democrats, the response I get is about black lives, trans rights, and the environment — and they only care about the environment for giving jobs to minorities. Now, can you compensate for that? Collectively, you can probably put together a coalition that can win without non-college-educated white men. But if your policies don’t do anything for that constituency, the anger is back in a heartbeat.
This interview has been edited and condensed for clarity.