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Pension fund socialism: the illusion that just won't die

comments on Robin Blackburn's Banking on Death

by Doug Henwood

delivered at the conference "Pension Fund Capitalism and the Crisis of Old-Age Security in the United States," sponsored by the New School University, September 11, 2004

I think I was invited here to play the critic, and I'm going to live up to my billing. I have a lot of problems with Robin Blackburn's proposals, both economic and political, so let me lay them out.

My title, "Pension Fund Socialism: The Illusion That Just Won't Die" is something I was asked to provide long ago, well before I knew what I was going to say. I've since learned that Robin doesn't think of his proposal as a form of what used to be called creeping socialism, which is reassuring in some sense. But I'm still not clear on what it is. Karl Marx and Milton Friedman, whatever their differences, at least share the virtues of clarity and intensity. Banking on Death is, appropriately enough, mostly shades of gray. I don't see much of an economic analysis, of pension funds in particular or finance in general, and I also don't see much attention paid to the issue of political agency either.

Let me start with a little economic analysis. Maybe I'm suffering from wounded narcissism, but a few years ago I wrote a book called Wall Street that attempts a comprehensive and systematic analysis of the economic and political role of finance in modern, mostly American, capitalism. Blackburn deals with it rather dismissively in a single footnote. Let me bring the analysis presented in that book to bear on some of the issues that he raises.

Many people - inha