Sunday, June 04, 2017

Jane Jacobs Sees That Poverty is Normal. This is a Calvinist Insight

Jane Jacobs, the founding mother of the new urbanism, wrote a trilogy of books about cities.  She defined the field with The Death and Life of Great American Cities, and extended her insights in The Economy of Cities and Cities and the Wealth of Nations.  I am reading my way through all three again.

I was struck this time by her critique of macroeconomics, which she describes as a "shambles."  Economics, she says, has long thought that prices and jobs were two ends of a seesaw - if one was up, the other had to go down.  This, they thought, was a basic rule of the market.  Their job as economists was to come up with the right balance of the two. Thus, the endless war of demand-siders and supply-siders.

However, writes Jacobs, in the '70s and '80s all economic theory was confounded by "stagflation" - high inflation and high unemployment.  Both bad options of the seesaw were up at the same time.

The true condition of humanity, Jacobs wrote, is that poverty is the norm - most people most of the time have lived with both high prices and high unemployment.

The great achievement of creative city economies is to create moments of innovation that drive prices down, and growth that drives employment up.  This achievement is not guaranteed, and cannot be sustained in any one place for long.

This, it seems to me, is a very Calvinist insight.  The normal condition of human beings in a fallen world is poor.  We are given a vocation within which to work in order to build up the world.  The work is hard and the prize is not guaranteed.  But the story of human existence shows that it can sometimes be done.

Jacobs was raised in a Calvinist family, though she became a very secular adult.  But perhaps this insight shows the long effects of her early training.

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