In our recent discussion of Robert Putnam’s ethnic diversity and distrust research, Eva Cox had this to say:
I suspect also the lack of bridging social capital in such diverse areas may also be fired by too much neo-liberal emphasis on markets that place risk on individuals, encourages self interest and undermines social cohesion.
This is an argument Eva has been pushing for more than a decade, with most publicity surrounding her 1995 Boyer Lectures ‘A Truly Civil Society’, later published as a book of the same name, which I gave a rather harsh review in the March 1996 issue of Quadrant.
Eva took a contrary position in the social capital and trust debate of the time. When most other writers were emphasising the bottom-up nature of these social phenomena, Eva took the top-down view – they would be increased by more state activity rather than less. One chapter is even called ‘The Companionable State’. People acting freely without the state could be bad. ‘Competing marketers in head-on battle destroy society’, she told us, to no doubt much nodding of heads in Glebe and Fitzroy.
There are many of us who feel pessimistic about the future, who feel society is gradually coming apart at the seams. The idea of the social is losing ground to the concepts of competition, and the money markets are replacing governments. The social aspects of humanity have somehow disappeared…
A decade on Eva’s pessimism seems distinctly misplaced. In a chapter she wrote for Robert Putnam’s Democracies in Flux she reported on the standard interpersonal trust question for 1983 and 1995, in which 46% and 39% respectively thought that most people can be trusted. In 2005 it was up to 53%. There is other evidence suggesting that our social capital is improving. The Giving Australia research project reported that volunteering and donations had both increased since the 1990s.
Other aspects of Eva’s theories have also been discredited. ‘Telling us not to trust government spills over into not trusting our neighbours or even ourselves’, she said. Yet it now seems that to the extent that there is spillover in trust between spheres of life it goes the other way, that trust at a local level leads to trust in government. She thought that ‘ever longer hours of paid work’ put social capital at risk, but HILDA has shown that people who work long hours tend to be better connected than those who work shorter hours, and those with the most time – the unemployed – suffer worst from social isolation.
As I pointed out back in 1996, Eva does not understand markets – that they are fundamentally an other-person orientated institution, which promote co-operation with customers and within firms. And to the extent that markets do allow self-interest space, there is little reason to believe that this encourages people to act self-interestedly in spheres of life where that is not appropriate. Even having babies and raising children, the most generous thing most people will ever do, is on the rise again.
One change over the last decade makes me hesitate to declare complete victory. This is that, in line with the broad ideological thrust of a A Truly Civil Society, the Howard government has been on a huge spending spree. Interestingly, much of that has been directed through the institutions of civil society, in family benefits and the outsourcing of services (Eva would presumably prefer direct government control). I think this trend has worrying long-term implications in the politicisation and bureaucratisation of non-government institutions. But perhaps in some way it may have contributed to the good social results we have seen since the 1995 Boyer lectures.
Andrew Norton 
“perhaps in some way it may have contributed to the good social results we have seen”
Is this a partial concession Andrew? Do you mean to say that without this government action social results may not have been as good? If so, what outcomes do you mean in particular? Surely you aren’t saying, for example, that we may not have such strong families if it were not for family tax benefits?
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James – I’m not conceding anything, just leaving open a possibility because causation in social science is so complex. I’m confident that markets caused no harm, but less clear that the increase in government spending had no positive effects. The increase in births recently and the huge spending on families (including the baby bonus) may not be coincidence, for example. This doesn’t mean I support these things – I don’t – but leaves open that they were not all bad in their consequences. Cox’s lectures were a travesty of social science, and I don’t want to replicate her shortcomings.
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Andrew, Eva not understanding markets.
She started the WOMENS economic think tank!
I do recall David Clark making some clear accusations of Eva forgetting to mention some of her sources for her Boyer lecture which in true Albrectson fashion she never got around to explaining whilst complaining about the accusation.
now you have written a column about what Eva thinks!
What next a column about what Philip Adams thinks?
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MAKE LOVE; NOT BABIES
Andrew, I must challenge your statement that having babies and raising children is the most generous thing most people will ever do.
First, some people concerned about global population problems would probably argue that NOT having babies is more generous than having them.
However, my key objection to your statement is that, IMO, reproduction is essentially a lifestyle choice that people make for inherently self-interested reasons – for example, satisfaction of their parental instincts, having someone to love and receive love from, a chance to exercise authority, and emotional and/or financial security in old age. Of course, once Smashleigh, Snotleigh and Screamleigh enter the world, people’s parental instincts kick in and they act in other-concerning ways. But they know this will happen before they make the reproductive decision – its part of the benefits and costs of parenting – so there is nothing particularly ‘generous’ about it.
If people were truly being ‘generous’, then surely they would satisfy their paternal preferences by adopting an already existing but underpriviledged or orphaned child.
(Incidentally, I have nothing per se against self-interested behaviour; my point here is about dressing up self-interested actions as altruism and generosity.)
Would be interested in your thoughts…
Tom
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Maybe Eva Cox is looking for a certain quality in life and relationships, whereas your examples are just statistics. To say volunteering is up is not to say that it might be because Mum has been shunted off to an”aged care facility” rather than living with family, thus allowing said family the luxury of deciding to volunteer to their selected organisation 1 or 2 mornings a week, rather than looking after Mum.
To say that people working longer hours are more connected similarly doesn’t tell us about the quality and effects of their connectedness. Statistics on trust might show an increase but probably so are sales of home security devices and the number of people signing pre-nuptial agreements. How do you balance these things?
You aren’t serious in claiming that markets are “fundamentally an other-person orientated institution, which promote co-operation with customers ” ? Personal gain has nothing to do with it ? My mother lives in a suburb that has one small shopping centre, and no other shops, and bad public transport. She, and many of her neighbours, are too old to drive. There used to be a small supermarket, a fruit shop and a butcher. Until the supermarket changed hands, and the new owner expanded his fruit, veg and meat section and lowered his prices enough to put the other two out of business. Now prices have gone up, and up – but there’s no competition, no alternative. So “other-person orientated” doesn’t mean “for the benefit of other people”, it just means working out how to make the most money out of them, including changing their options.
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Tom – Your analysis is that is it capable of reducing almost all human actions to self-interest, very broadly understood. I’m not sure that this is the best way to describe having and raising children, at least in this context, which is a debate about the role of *material* self-interest in society. Except perhaps from a few welfare mums cashing on the Howard government’s family spending, nobody has children for financial gain.
Russell – I’m not saying that personal gain doesn’t come into it; it is about harnessing self-interest for mutually beneficial purpose. Most state action is a zero-sum redistribution; for every winner there is a loser. This is one reason why state action does not produce the social cohesion that Eva believes it will.
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“Most state action is a zero-sum redistribution; for every winner there is a loser.” How is it so ? I don’t have children but I’m happy to pay taxes to live in a more educated society etc On what basis are you declaring winners and losers?
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(Eva Cox) thought that
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David – Though the social capital literature persistently shows that educated professionals have quite high rates of volunteering, despite also typically working the longest hours. We are probably well below the historic peaks of volunteering, but this partly reflects reduced need – government now does much of what voluntary organisations used to do. And I am confident from the surveys we have that volunteering is on the rise again. There was a question about it on the census, so it will be interesting to see what that comes up with.
With the unemployed, there is possibly some cause – the long-term unemployed probably have lower average levels of social competence than the general population. But there is effect here in reduced opportunities to meet people at work and not being able to afford to go to things.
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Leftwing critics of markets are off the planet, they just don’t understand that markets are not great impersonal things, they are something that happens when people sell or exchange things. Like the craft fairs that they love so much.
When someone says “the market will decide [how much your house or car is worth]” it is a shorthand for saying “people out there will decide how much they want to pay for it [and if you ask too much they won’t buy]”.
So what is the problem about markets that governments are supposed to fix up?
As Andrew wrote, the increasing dependence of the voluntary sector on government support is a worry for the future.
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Andrew – You are correct that almost any human actions can be ‘modelled’ as self-interest, and so the question is whether such an approach is sensible. However, my post did more than just model it in that way: it also issued a challenge – why not adopt a needy child instead of breeding your own? – to the idea that having children is a generous act. As I said, I have no bojection to self-interest per se; what I do challenge is the tendency to describe certain self-interested behaviours in altruistic terms.
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“- why not adopt a needy child instead of breeding your own? ”
Tom – Presumably, because sex is a lot more pleasurable than the years of bureaucracy required to adopt a child from overseas. But I was never claiming that people have children to prove they are altruistic, just that they would not do it if they were consumed with the financial self-interest that people like Cox say is spread by the market.
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Rafe,
What about things the market won’t provide, equitably … Classic FM, the CSIRO ?
What about setting rules for providers of services such as child care, finance broking ?
What about setting rules for health + safety, pollution etc where the market may not know what a company is doing ?
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Rafe,
In my view people should be very suspicious of anyone who claims either that markets always fail or that markets never fail. Both of these extreme views are wrong. These views amount to ideologies. Since this is somewhat off topic, rather than elaborate on this issue here, I will simply recomend the following links to posts at my own blog. I have a post on market failures. I also have a series of three posts on the differences between economists, extreme pro-market ideologues and extreme anti-market ideologues. The links to these posts are provided below.
http://economicsgeek.blogspot.com/2006/10/what-is-market-failure.html
http://economicsgeek.blogspot.com/2006/10/difference-between-economists.html
http://economicsgeek.blogspot.com/2006/10/difference-between-economists-extreme.html
http://economicsgeek.blogspot.com/2006/10/economics-versus-ideology-once-again.html
Regards,
Damien.
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