Chatted with someone online recently about economics and American life, though admittedly in the wee hours of the night and after consuming several brews isn’t a good time for me to try to unpack my thoughts and ideas on such a vast series of topics. So today I’m dragging the inquiry back to my blog to see what can be addressed more clearly.
It’s not uncommon for people to be quite attached to the concept of “capitalism” and to to take issue with those of us who critique it. But I want it understood that I am not necessarily entirely anti-capitalist; furthermore, by being a critic of what I refer to as the modern economic setup in the U.S., this does NOT imply I am any less critical of communist strategies. It’s tricky because I personally see ALL of these centralized top-down economic systems as inherently problematic and worthy of scrutiny, yet some people seem to see such matters as if a competition between two opposing teams where one must choose a side and declare loyalty. I reject that notion and see it as folly. While I recognize that’s not a popular view of things, it’s what I’m operating with, and I’ve given a lot of thought to these matters and will continue doing so for as long as I remain in existence.
Now, part of the issue it appears I’m having with folks comes down to simply agreeing on what all capitalism comprises. It’s very important that we get our terms defined more clearly here, since otherwise we just wind up mired in confusion and any debate winds up getting us nowhere. I’ve noticed that it’s not uncommon for some folks to equate virtually ALL trade and barter schemes with capitalism, but that’s a falsity. Commerce existed long before capitalism came on the scene. I have stated many times that I support a true free market economy, HOWEVER, that is not what we have today, nor is that what capitalism originated as.
This is where it gets very sticky, because my present view on the matter is that capitalism allowed to exist without proper government regulation has demonstrated that it will behave in a coercive, monopolistic/oligopolistic fashion that eventually undermines capitalism itself, turning the system into something else that actually winds up being anti-capitalistic in nature. We’ve observed how capitalist entities can rise in power to the point where they have a disproportionate amount of power compared against the people, and they have then used this economic power to sway laws and legislation in their own companies’ favor, at the expense of the small businesses rendered unable to compete in such a scheme. And through this we’ve seen the rise of Corporatism. Corporatism is not capitalism, per se — one might consider it a bastardization of that original concept since it winds up restricting free competition if legally allowed to do so. And really, at a time of extreme specialization and high financial barriers to entry in a growing number of sectors (particularly those involving advanced technologies), how can it realistically be any other way?
Now, some like to argue that corporatism somehow isn’t directly related with capitalism, and frankly, such claims blow my mind. So let’s take a moment to look at what each of these economic setups are and what they originated from.
[Jesus. I just wrote out this WHOLE frickin’ piece and lost it all the way back to this point. DAMMIT! So let’s try this again, maybe breaking it into two parts this time.]
On the topic of capitalism, the Encyclopædia Britannica had this to say:
The development of capitalism was spearheaded by the growth of the English cloth industry during the 16th, 17th, and 18th centuries. The feature of this development that distinguished capitalism from previous systems was the use of the excess of production over consumption to enlarge productive capacity rather than to invest in economically unproductive enterprises, such as pyramids and cathedrals. This characteristic was encouraged by several historical events.
In the ethic encouraged by the Protestant Reformation of the 16th century, traditional disdain for acquisitive effort was diminished, while hard work and frugality were given a stronger religious sanction. Economic inequality was justified on the grounds that the wealthy were also the virtuous.
Another contributing factor was the increase in Europe’s supply of precious metals and the resulting inflation in prices. Wages did not rise as fast as prices in this period, and the main beneficiaries of the inflation were the capitalists. The early capitalists (1500–1750) also enjoyed the benefits of the rise of strong national states during the mercantilist era. The policies of national power followed by these states succeeded in providing the basic social conditions, such as uniform monetary systems and legal codes, necessary for economic development and eventually made possible the shift from public to private initiative.
Beginning in the 18th century in England, the focus of capitalist development shifted from commerce to industry. The steady capital accumulation of the preceding centuries was invested in the practical application of technical knowledge during the Industrial Revolution. The ideology of classical capitalism was expressed in Adam Smith’s Inquiry into the Nature and Causes of the Wealth of Nations (1776), which recommended leaving economic decisions to the free play of self-regulating market forces. After the French Revolution and the Napoleonic Wars had swept the remnants of feudalism into oblivion, Smith’s policies were increasingly put into practice. The policies of 19th-century political liberalism included free trade, sound money (the gold standard), balanced budgets, and minimum levels of poor relief.
World War I marked a turning point in the development of capitalism. After the war, international markets shrank, the gold standard was abandoned in favour of managed national currencies, banking hegemony passed from Europe to the United States, and trade barriers multiplied. The Great Depression of the 1930s brought the policy of laissez-faire (noninterference by the state in economic matters) to an end in most countries and for a time cast doubt on the capitalist system as a whole.
Here we see capitalism as being composed of many aspects, none of which could’ve existed within a vacuum and all of which have proven necessary over time as this type of system dynamically “evolved.” We see that capitalism isn’t a static concept and has changed since its inception during the fall of feudalism on into the rise of the Industrial Era and on through into our post-industrial setup.
And when it comes to capitalism or a “free market economy,” as mentioned already, I think a lot winds up ascribed under that heading that existed long before and is really a matter of free commerce and exchange (historically known as trade and barter). That’s a point of contention that I may try to flesh out in greater detail another time.
The definition of “corporatism” is a bit hazier. But for my purposes today I wish to focus in on the American system primarily.
In an article written by Robert Locke for FrontPage Magazine (2002), he had this to say:
What is corporatism? In a (somewhat inaccurate) phrase, socialism for the bourgeois. It has the outward form of capitalism in that it preserves private ownership and private management, but with a crucial difference: as under socialism, government guarantees the flow of material goods, which under true capitalism it does not. In classical capitalism, what has been called the “night-watchman” state, government’s role in the economy is simply to prevent force or fraud from disrupting the autonomous operation of the free market. The market is trusted to provide. Under corporatism, it is not, instead being systematically manipulated to deliver goods to political constituencies. This now includes basically everyone from the economic elite to ordinary consumers.
Unlike socialism, corporatism understands that direct government ownership of the means of production does not work, except in the limiting case of infrastructure.1 But it does not represent a half-way condition between capitalism and socialism. This is what the West European nations, with their mixed economies in which government owned whole industries, tried to create until Thatcherism. Corporatism blends socialism and capitalism not by giving each control of different parts of the economy, but by combining socialism’s promise of a government-guaranteed flow of material goods with capitalism’s private ownership and management.
What makes corporatism so politically irresistible is that it is attractive not just to the mass electorate, but to the economic elite as well. Big business, whatever its casuists at the Wall Street Journal editorial page may pretend, likes big government, except when big government gets greedy and tries to renegotiate the division of spoils. Although big business was an historic adversary of the introduction of the corporatist state, it eventually found common ground with it. The first thing big business has in common with big government is managerialism. The technocratic manager, who deals in impersonal mass aggregates, organizes through bureaucracy, and rules through expertise without assuming personal responsibility, is common to both. The second thing big business likes about big government is that it has a competitive advantage over small business in doing business with it and negotiating favors. Big government, in turn, likes big business because it is manageable; it does what it is told. It is much easier to impose affirmative action or racial sensitivity training on AT&T than on 50,000 corner stores. This is why big business has become a key enforcer of political correctness. The final thing big business likes about big government is that, unlike small government, it is powerful enough to socialize costs in exchange for a share of the profits.
The key historical moments in the development of American corporatism can be easily traced. It got its start from the realization, during the Progressive period around 1900, that the night-watchman state was too weak to make the large corporate actors of the economy play fair. The crucial premise that enters here is that the capitalist economy cannot be trusted to be self-regulating, as it previously had been. This collapse of trust was also implicit in the 1913 creation of the Federal Reserve system. What the Great Depression did was destroy a second kind of trust: that the economy would reliably deliver material goods without government intervention. With these two different kinds of trust gone, corporatism becomes not only worthwhile, but necessary. Crucially, it becomes psychologically necessary, independently of whether government can deliver on its promises, because people instinctively turn to government as their protector.
Clearly, the New Deal was the biggest jump forward into corporatism, though this was not fully understood at the time. […] But the fundamental proposition, that government should take responsibility for ensuring the flow of material goods to the people, was rapidly embraced by the American people, which continues to embrace it today whether it admits it or not.
The economic Left likes corporatism for three reasons:
- It satisfies its lust for power.
- It makes possible attempts to redistribute income.
- It enables them to practice #2 while remaining personally affluent.
The economic Right likes corporatism for three different reasons:
- It enables them to realize capitalist profits while unloading some of the costs and risks onto the state.
- The ability to intertwine government and business enables them to shape government policy to their liking.
- They believe the corporatist state can deliver social peace and minimize costly disruptions.
[…] Most economic arguments today are not between a socialistic ideal and a capitalistic one, as many seem to believe, but are arguments within the corporatist consensus.
[Bold emphasis mine.]
That’s an interesting article worth checking out in length if you have the time (link above).
That last sentence I quoted there is key, I do believe. And this leads back to my thoughts about how much the political “Right” and “Left” ultimately wind up sharing in common.
Now, if we’re to try to claim corporatism somehow did not arise out of capitalism, then that just appears to defy reality. It did, partly as a reaction to it, partly as a means of attempting to stabilize it. And partly this was due to the will of the people.
So now I’ll switch focus onto my own personal stance since that seems to be what’s causing the greatest confusion with those I interact with. [This being a shorter version since I already typed this all up for 2 hours earlier before WordPress decided to delete it all without saving the full draft. I likely will revisit the topic another day to go into greater detail.] The so-called “Luddite-ness” of my own viewpoint is noted, but I want to stress that my position isn’t anti-capitalist necessarily. While I am indeed very critical of the capitalist system, I’m also critical of all centralized-scheme alternatives proposed as well (including communism and big-scale, top-down socialism). So I am unable to view this as an “either/or” situation where I must profess loyalty to one camp or the other — no, that’s not called for here. It appears more beneficial for me at this time to simply observe what’s unfolding and to record my thoughts and concerns about it, because I do not have a dog in this fight going forward. That’s part of the beauty of remaining child-free and self-employed in that I am afforded time and energy to try to make sense out of what’s occurring without feeling like I must succumb to pressures to completely immerse myself in this game. And I understand that may sound a bit bizarre to someone who’s chosen to take his life in an entirely different direction through pursuing a career and raising a family.
Look, part of the trouble with this is that from what I read, hear, and observe I’ve come to see this whole ordeal as unavoidable, especially by this stage. But that’s not to say that this scheme is automatically or inherently evil necessarily either. It’s simply part of the process of humans unfolding their potential. And through doing so we’ve pushed our backs against a wall where any other alternatives seem implausible by this point, largely because of how much we have emotionally, psychologically, and materially invested in this current setup. While the system will continue to shift and change, it will not be fundamentally undermined, not if the majority has any say in the matter. And so this becomes one more thing I must accept because I am powerless to change it. And you have asked what “solution” I would offer instead. This system, as it stands now, was created through hodge-podged efforts spanning back hundreds of years, underpinned by Christian ethics, and so any alternatives that possibly could come into being likely would have to arise just as organically. I don’t believe any one person is capable of concocting a vision of such magnitude, partly because there are always unforeseen variables that play a role in how any system “evolves” over time.
My next point is that I recognize it is not my place to force my will onto others, while I recognize plenty of others out there do indeed wish to force their will(s) onto the rest. My aim primarily at this point is to dodge such attempts so as to maintain as much freedom as possible, for however long that lasts. Because my own aim is to live and learn and ponder and explore, and I see no reason that I shouldn’t be free to do so. By being conscious of not getting tied down to obligations and expectations, this has provided greater flexibility. Though yes, everything is a tradeoff, as always. But my own goal for many years has been to establish a perch on which I’m able to explore as I see fit, and this I’ve managed to accomplish, as someone who no longer desires a great deal of money or material goods. I say all this in an attempt to demonstrate how my viewpoint has been shaped and why it may differ from people pursuing other ambitions. In short, I choose to be less invested in this Game and am not attached to its eventual outcome.
Let me re-state that to make sure it hits home: I understand and accept that the eventual outcome is out of my hands. C’est la vie.
What power I do have is very limited and fairly localized. As is true of most of us. And I do feel an obligation to act on that in accordance with my own moral code, though that does not entail playing the game as others may choose to do so. Some may consider critics of little value, and that’s fine. They may be right, but it is what it is at this point. And a big reason for why it must go this way is that I also understand that humans aren’t as malleable as we like to think we are. Oh sure, we can flex to great extents, but not without consequences, whether we’re aware of them or not. Humans have biologically evolved for ways of life that did not involve big centralized governments or living in concrete jungles or experiencing high stress levels daily due to the modern economic imperative, all while residing in unprecedentedly highly-populated urban areas among strangers with countless conflicts in interests.
While I understand that this is all traceable back to our earliest human strivings and is natural in that regard, what humans have managed to construct is quite unnatural. Not all are capable and/or willing to psychologically adapt to what is unfolding. Sometimes it gets me thinking about animals in a zoo and how some cease breeding while in captivity. That’s a natural response past some point, for whatever reasons, and I feel it within myself as well, long before I understood it for what it is. There are psychological needs required to be met if humans are truly to thrive, and yet we seem to be experiencing a shift away from that (which would be away from what Erich Fromm would refer to as “life-affirming”). From this psychological conundrum suicides also arise due to existential crises. Not all can adapt the way some others apparently can or at least aim to. So this pressure to get people like myself to find a way to adapt so as to play the game and prove “successful” according to standards set by others will prove to be a waste of time and energy. Any alternatives sought come from within the individual, and these are not the sort of things one can clearly convey to another much of the time.
My way of maintaining sanity is to distance myself so far as I’m able from the rat race and to observe aspects of it. Because learning gives me pleasure. That might not prove very beneficial to others, and so be it. This is part of the reality created when humans become so atomized and feel alienated. I’m not sure how to put this in a way that doesn’t sound like I’m heavily lamenting this fate. Some days I indeed do, but many others I just try to accept it for what it is, recognizing that my goal isn’t to live a long life but rather to enjoy experiences from day to day so far as I’m able. And, admittedly, I am twisted up currently and seeking new ways of navigating in my journey going forward, but that’s a personal matter and another topic for another time. My point here is that I believe we’re all impacted to various degrees, though some have buffers (internally and externally) that aid them in coping and navigating, but that is not a luxury afforded to all, if not even most. Not that anyone should feel guilty about this, seeing as how individual lives shake out as they do. But the same holds true running in the other direction in terms of one’s psychological and emotional faculties and how all of that’s expressly influenced by the very type of society one is expected to fit the mold(s) of. To minimize the importance of this is to miss out on why so many people out here are struggling to come to grips and/or rebelling.
It’s indeed a tangled web we humans have managed to weave…
Another point worth mentioning when it comes to possible alternatives is how we’re commonly led to accept this current fate due to propaganda that vilifies our human history, denigrating past ways of life as “barbaric” and “savage” so as to present this modern way as “progress.” And people buy into it. Now, we all could point to modern comforts and life-saving technologies that have eased many of our burdens, and all of that would be true; but there’s another side to this “progress” that we fail to give as much weight, that having to do with major centralized schemes and advanced warfare and an ever-greater push toward some new type of conformity in order to accommodate what’s come into being. In a sense, we’re out of our element, and understanding that alone helps shine light on the psychological conundrum that goes hand in hand with what we esteem as “progress.”
We’re dealing with a progression, most definitely. And everything in life comes with tradeoffs, with pros and cons, and not all in equal measure. I am unable to choose a side within this debate since it’s all beyond me, beyond what I’m able to solidly back and promote and accept as a higher order. Because from where I stand it looks like we’re taking flight from our natural origins and are attempting to transcend that with something of our own design. It’s certainly a lofty ambition, but I’m not one of those who sees humans as having evolved as far as we like to think we have. Furthermore, I don’t see transcendence on the horizon — no, rather, it appears what’s coming is greater sublimation (or, more accurately, subjugation), this time not only to a wide collective but also to the fruits of our own labors, our own technologies and the economic imperative that allowed all of this to be possible. It’s a double-edged sword, as so much in life turns out to be. We have created a vicious cycle that perpetuates itself by this point, which also makes it possible for so many people to simply fall asleep at the wheel, knowing they’ll likely wind up provided for in the end regardless. Thanks to the political game and its direct ties with the economic game and the technologies that have reinvented our habitats and world.
While it’s all fascinating to behold, it’s not something I can feel morally secure backing. So I have to carve out my own way and make do, and that’s fine. It’s all a big, ongoing inquiry so far as I’m concerned. Parts of it are tragic, parts of it are amazing; some is within our control but plenty appears no longer to be, being either the domain of Nature or of the centralized power scheme and its workings. I can choose not to feed the beast more than absolutely necessary — that’s one form of power that I do try to exercise. But I do not kid myself that any utopian scheme will arise from the route we’re currently on. This is an age-old trajectory that has to run its course apparently. If for no other reason, because humans have to learn everything the hard way. But those who wish to branch off and try something else, so far as they’re able to, I support as well. I’m interested to see how humans manage to navigate this maze we’ve constructed, though we of today will only be around to see but a small sliver of the big scope.
Hard to “pick a side” when this is how one approaches such matters.
Much of what influences my own worldview is probably best expressed by others whose work and ideas I try to point to (when feeling up to transcribing or able to find relevant clips). And I’ll aim to continue doing so going forward, in case others might get anything out of it.
[And next time I will copy and save my work before uploading a post since this all came out very differently the second go-round. Ugh.]