On the new class fundamentalism

These are my comments from a roundtable organized by Igor Shoikhedbrod at APSA 2022. They are a first, rough attempt to think through issues of class in social theory and in socialist politics. They are both rather tentative and rather basic, but I hope they are also somewhat helpful.

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I’m trying to figure out the new “class is fundamental” discourse. In some of its aspects, it is not so new. Adolph Reed has been pushing the same line for 35 years. Aging Trotskyists are not saying anything they haven’t been saying forever. But older tendencies have gained a new inflection by interaction with elements that are much more genuinely recent. The post-Bernie anti-liberalism of certain parts of DSA, the anti-PMC line being pushed by the romantic workerists who publish in Compact, etc., seem very conjunctural.

Within this context, what does it mean to insist that class is fundamental? 

I find this a hard question to answer, in part because it is hard to isolate the theoretical account offered by these authors from the critical attacks on others that carry the message. The critical attacks often seem to boil down to an imperative to say the word “class” more, and the words “race” and “gender” less. Nonetheless, the critique seems to be motivated by the sense that “class” cuts the social world at its joints. There is a conviction that organizing around racial, gendered, or other identities, and around injustices of status and standing, are distractions from (a) what is *really* going on, and (b) what might actually *work* politically.

"What is really going on": The fundamental social processes that drive, undergird, and explain the conflicts about status and standing and identity are the class processes of capitalism in its current neoliberal form.

"What might work politically": Naming and appealing to people’s material interests – which are their class interests – is both more motivating and more inclusive than naming and appealing to people’s status, standing, and identity, which are particularistic and divisive, rather than universalistic and unifying.

I understand the appeal of this, I think. The individual claims out of which these intuitions are constructed are themselves compelling. The class processes of capitalism are fundamental for understanding the world. Appealing to common and material interests, and building universalistic policy programs, are the best shot we have of moving things in a better direction. And yet, the class fundamentalist position as whole doesn’t seem to me to make much sense. When I think about how and in what sense each of the elements is true, then it seems impossible to combine them in the way that the new class fundamentalism does, and the whole things seems to fall apart. 

I want to look at the two aspects of the position in turn, and to point out where I keep getting tripped up.

In what sense, first, are class processes and conflicts the fundamental social processes that drive or explain other conflicts? 

Class is fundamental, in this sense, because production is fundamental. Class relations organize production, and so, since production is fundamental to the existence of human society, solving the class relation problem is a constraint on everything else that goes on in society. 

Now, you could say the same thing about reproduction. Since reproduction is also fundamental to the existence of human society, it might seem that relations of reproduction – sex and gender – are equally primodial and equally basic to everything else going on in society. But here there is an illuminating contrast. It turns out that human beings can reproduce the species in in a wildly divergent set of social relations. Reproduction does not require any particular social relations to be successful. That is, in the case of reproduction, stable functionality radically underdetermines social form. As long as there is enough food, humans find ways of reproducing the species, and the ways they find to do so are flexible and varied to an incredible degree. 

Not so for production. Production at a certain level – for a given population, at a given level of social wealth – binds us socially to a much greater extent. Hence, production relations are much stickier. We cannot produce food and technology for a world of 8 billion people, who are used to and reliant upon modern life, in just any old way. We are, in this sense, locked in – for now – to certain relations of production, and this means to certain class relations. 

Class, in this sense, names the relations of domination and exploitation that are productively necessary for a given society. 

The point of base-superstructure materialism is to underscore this fact, that class relations are themselves a “social technology” of production, and that more productive class relations are more powerful class relations, which tend to win out in competition with other, less productive class relations. (The mechanism of this winning out can vary. It might be that more productive class relations outspread less productive, or that they developmentally outstrip them, or that they lead to military overmatching, or…)

However, there are a couple wrinkles. First, a tendency is just a tendency, and will be more notable and stable at a large scale and over a long time than it is locally and at any given point. Historical materialism is not a species of determinism. Second, the more productive the economy, the greater the surplus, and the greater the inequality in how this surplus is spread around, the greater the “slippage” between socially necessary class relations at the level of the whole and the relations of production that obtain locally in any given workplace or jurisdiction or line of production. That is, the more productively developed an economy, the less likely its “competitive edge” is to be critically present in some one site or line of production.

In this situation – and it is, I think, our situation, to a greater extent than it has ever been any other society’s situation – class relations remain fundamental, but they are progressively distinct (without being independent) from work relations. Work relations – relations of domination and exploitation at the site of production – are labor-management relations, not proletarian-capital relations. Proletarian-capital relations obtain in an abstract but determining way at the level of society, which is mediated in its essential productive processes by the labor market. Work relations obtain in an empirically perceptible but overdetermined way at the level of everyday life, which is mediated in its contingent productive processes by all sorts of things.

This analysis – which is based on Marx’s distinction between abstract and concrete labor – highlights a constitutive obscurity in the new class fundamentalism's political project.

The injunction to focus on class in political practice is itself interestingly out of step with the injunction to trace things back to the political economy of capitalism. After all, “class” does not name a reality proper to capitalism, but a constitutive element of almost all human societies to date. The corollary of tracing the fundamental dynamics of capitalism would be an emphasis not on class but on the proletariat. But naming the proletariat would emphasize what so much of the new class discourse obscures, that the working class as the producers of things is not equivalent to the working class as the class of wage-workers, and neither is equivalent to the proletariat, the class of people dependent upon wages for life, whether they are working or not. 

I think this conflation of capitalist class relations with work relations is an understandable but regrettable feature of the new fundamentalism. 

Understandable, because it’s not as if capitalist class relations are independent of capitalist work relations, and work relations are much more empirically tractable and politically salient in an obvious way. 

Regrettable, though, because it leads this current emphasis on class to fall into a false opposition between “class-based” politics and other forms of political organizing. This is because, by shifting between features of the structural class relation basic to capitalism (between capitalist and proletarian) and features of one or another work relation, the new class fundamentalism makes its political task too easy. Class politics has the immediacy of work relations, but the universality of class relations. Class politics – like workplace organizing – appeals to material interests, but it also – unlike workplace organizing – has a national and even international constituency. 

There’s the old saying in labor circles that “the boss is the best organizer.” I think the new class fundamentalism wants this to be true, not only at the level of the shop floor, but at the level of society at large. And there are points in time when that actually seems plausible. In the second half of the 19th century and first half of the 20th century, in Europe and North America especially, it was reasonable to think that capital organized labor at scale. The emptying out of the countryside, the massive amalgamation of the industrial working class in factory, mine, city, and district – all of this encouraged Marxists and other socialists to think that capital was itself forging the proletariat into a political subject with common experiences, common spaces, common mores and traditions. 

That belief is not reasonable anymore, about Europe and North America at least – and it was never as correct as it was reasonable. 

Cedric Johnson said the other day, at a panel honoring Adolph Reed’s work, that what victims of police harassment and violence have in common is not race but class. That is true – but it is also abstract. Around here, it may be that everything I see and know tells me that police harassment and violence are about race. And local truths about racial harassment and violence are no less true than local truths about workplace harassment and precarity and overwork.

It seems to me that the real challenge of a class-based politics in our world is that it is an inherently abstract, theoretical politics. Building a global alternative to the capital-proletarian class relation is necessarily the most challenging and difficult political struggle imaginable. It is tempting to think that there is some local crystallization of this abstract, global struggle, some everyday struggle that doesn’t have to be translated into this global struggle because it just is this global struggle in a bite-sized form. But I don’t think that’s true. 

What's Left of Liberalism?

Oy, does this thing still work?

So, Matt Yglesias thinks he has no enemies to the left.  I haven't waded through all of the post he is responding to, but...

Issue numero uno: de Boer says of Yglesias that he is "one of the most vocal of the neoliberal scolds, forever ready to define the 'neoliberal consensus' as the truth of man and to ignore left-wing criticism."  To this, Yglesias responds: 

I don’t really know what it means to criticize a writer for holding that his own views are “the truth of man.” Obviously, I agree with my political opinions and disagree with those who disagree with me. If I didn’t agree I’d change my mind.

But you're not being criticized for believing what you say -- you're being criticized for believing what you believe!  The problem is content, not sincerity. 

Issue numero dos: Yglesias avers, "while I’ll cop to being a 'neoliberal' I don’t acknowledge that I have critics to the 'left' of me."  He then rattles off a list of his primary policy concerns (to which I'll return), before saying:

I recognize that many people disagree with this agenda, and that many of those who disagree with it think of themselves as "to the left" of my view. But I simply deny that there are positions that are more genuinely egalitarian than my own. I really and sincerely believe that liberalism is the best way to advance the interests of the underprivileged and to make the world a better place.

The unspoken assumption throughout is that Left = egalitarianism.  No one is more egalitarian than Yglesias, hence no one is further to the Left than he.  Now this assumption has a long history.  In academic circles it certainly runs back to the 80s, when the Marxists stopped calling themselves Marxists and started calling themselves egalitarians, when historical materialism went out the window, to be replaced by neo-Kantian moral theory.  

If this assumption is taken on board, then those who thinks of themselves as being to the Left of liberalism are actually just sentimentalists and wishful thinkers -- they will the end of equality without willing the means of liberal government, which is the only mechanism for achieving equality.  Genuine egalitarianism is liberal egalitarianism.

As someone who thinks of himself as to the Left of liberalism, and who has never hoisted the banner of Equality!,  I'd like to register an objection.

Equality always has to be specified.  Equality unmodified means nothing; we must answer the question: Equality of what?  For Yglesias, it is equality of economic freedom, greater equality of economic outcome (wealth), and equality of respect and recognition -- pretty much the standard Rawlsian package.  Thus, look at the specific issues that concern him:

1. More redistribution of money from the top to the bottom.
2. A less paternalistic welfare state that puts more money directly in the hands of the recipients of social services.
3. Macroeconomic stabilization policy that seriously aims for full employment.
4. Curb the regulatory privileges of incumbent landowners.
5. Roll back subsidies implicit in our current automobile/housing-oriented industrial policy.
6. Break the licensing cartels that deny opportunity to the unskilled.
7. Much greater equalization of opportunities in K-12 education.
8. Reduction of the rents assembled by privileged intellectual property owners.
9. Throughout the public sector, concerted reform aimed at ensuring public services are public services and not jobs programs.
10. Taxation of polluters (and resource-extractors more generally) rather than current de facto subsidization of resource extraction.

Most of these -- 2, 4, 5, 6, 8, 9, 10 -- are nothing more than efforts to extend and perfect the market.  They internalize externalities, eliminate rents, etc.  Now I don't necessarily disagree with all of these things, but every one of them implies that we need more and better markets.  The remaining concerns -- 1, 3, and 7 -- aim to establish the non-market prerequisites of these more and better markets.  

Nowhere is there even a hint of the thought that an increase in market freedom might lead to a decrease in other sorts of freedom, or to less happiness, or to any other bad outcome.  Nowhere is there any mention of something like a guaranteed basic income, or of any other policy that would reduce the need for people to rely upon wage labor to live.  Nowhere is there any attention to global macroeconomic dynamics like the swelling of the global surplus population -- the hundreds of millions of people who do not participate in any meaningful economic activity whatsoever.  Nowhere is there any reference to tax competition.  Nowhere is there any hint that all these wonderful markets might depend upon the existence of a labor market, including a market for bare subsistence wage-labor, with all the poverty and desperation that market implies.

In short, nowhere does Yglesias hint that more and better markets might themselves be problematic.  That's not to say that the Left is or ought to be in favor of fewer and worse markets, but to say that the Left, since Marx, has been centrally opposed to the notions of freedom and equality that find their ground in "the market" -- the surface appearance of capitalism.

So, I say to Yglesias: sorry dude -- there's definitely plenty of room on your Left, and it's populated with enemies -- like me.

James Scott: Adam Smith or Karl Marx?

I can't escape James Scott right now.  Jacob Levy has contributed his two cents to the discussion of Seeing Like a State over at Cato Unbound.  There's a lot to talk about in Jacob's contribution, but I just want to point to one thing for now.  Jacob writes:

I suspect that Scott has been mildly embarrassed by the libertarian enthusiasm for Seeing Like a State, and since its publication he’s been at pains to be clearer than he was in the book that the market can also be a force of high-modernist social flattening. But he has not (that I’m aware of) pushed the thought very far, or told his readers much about when the market is that kind of force on its own, and when it is so when joined to state power. 

My Marxist self jumps up and down and yells: when have there been extensive markets that were not joined to state power!?!?!?!?!?!

Pessimism and Anti-State Politics

My comments for today's panel at CPSA:

My project is to try to flesh out a neo-Marxian politics using resources from institutional and new institutional economics. I begin from the hypothesis that human beings are evil. I try to be a little deflationary about this; when I say we are evil, I do not mean that we are malicious – though we can be – but only that we are not very good cooperators. This is because we are, at least potentially, a) prudentially rational agents, b) who act independently of one another, but c) who are dependent on one another for realizing our desired outcomes. In other words, we face the persistent threat of coordination problems.

This specter of coordination problems does not always arrive – collective action happens – but it is a real enough threat that we cannot, in principle, rule out the possibility of prudentially rational opportunism (free-riding, defection, rent-seeking, moral hazard, etc.) in our considerations of institutional design. The threat amounts to a divergence between the common good and the good achievable by the independent actions of prudentially rational agents. Any approach to collective action that does not take this threat into account in the structure and working rules it proposes for institutions seems, by that very fact, to convict itself of criminal naiveté by entrusting the entire existence of the proposed institutions to the care of good fortune alone. My essay tests various approaches to collective action by this criterion of naiveté.

Event: After Capitalism? [Updated with reactions]

This Thursday, 29 April, 2010; Salle 422, 2910 Boul. Édouard-Montpetit

• 13 h - 14 h Pierre-Yves Néron, CRÉUM : Public Capitalism

• 14 h - 15 h Pablo Gilabert, Concordia University : Socialism

• 15 h - 15 h 15 : Pause café

• 15 h 15 - 16 h 30 David Casassas, Universitat Autònoma de Barcelona : Property-owning Democracy

Info here. Poster here.

UPDATE:

A really nice event. About 20 lightyears from my way of approaching political philosophical problems, though. Whatever -- it's normative political theory. I don't do normative political theory. But it was also -- except, perhaps, for some of Casassas' paper -- ideal political theory. And I just can't get my head to go into that space at all. For me, political theory always departs from some very robust sense of the presently given human condition, and, because of this, I can never make heads nor tails of the leap to talking about a just society in abstraction from the concrete situation.

For example: Does the just society have neighbors? Does it have borders? If so, do these facts have any impact on what it means to be a just society? A just society has citizens; does it also have non-citizen residents? Does a just society engage in foreign trade, or does it produce all it needs? Either way, what does a just society produce? What does it need? Do trade relations or production relations ahve any impact on what it means to be a just society? Are its neighbors friendly or hostile? Does this matter for justice? Does a just society have a history? Is this history a history of justice? Does this history have any impact on the institutions of the basic structure? I just don't know how to bracket these questions in order to consider a just social order "in itself."

(Hell, even Plato didn't bracket these questions; the consideration that really gets the construction of the city in speech undrway in the Republic is the consideration that the city will be one of many, will have neighbors, and must be prepared to defend itself against them.)

Anyway, a very nice event anyway...

Market Providentialism

Some guy over at the American Enterprise Institute claims that the fact that air pollution has dramatically improved since 1980 is proof that the catastrophic predictions made by early environmentalists were wrong (and, hence, we ought to ignore all those dire predictions being made by environmentalists now, natch). As others point out here and here, this analysis neatly ignores the fact that environmental activism led to government regulation led to averting the predicted consequences of inaction.

This would not be especially noteworthy except that a similar line of "thought" can be found all over the place among those who feel that the market will provide. Running out of oil? No worries -- as the price increases, entrepreneurs will be motivated to innovate new extraction methods, new energy sources, more efficient engines, etc. (I've written a bit about this before, discussing some things said by John Romer, husband of Obama's chief economic advisor, Christina Romer.)

This providentialism always ignores the non-market activism that precedes and motivates the market activity that "solves" the problem in question. There's always a sticky point where Cassandras start screaming and marching and demanding change, and the market providentialists have a hard time fitting these Cassandras into their narratives of this, the best of all possible worlds.

An exercise in classification

Regarding and proposing solutions to coordination problems of various sorts (assurance games, prisoners' dilemmas, and the like):

Stalinists believe in the state, not in entrepreneurs.
Libertarians believe in entrepreneurs, not in the state.

Keynesians believe in both.

Communists believe in neither.

Basic Income Conference

Thursday, 15 April and Friday, 16 April, 2010, at Universite de Montreal. The full program, as well as more information, can be found here. Basic income is probably the only policy in the world advocated by communists, Rawlsian liberals, and Sarah Palin (as governor of Alaska, she presided over the only operating basic income program in existence, the state oil revenue grants).

I don't know the precise form of basic income guarantee advocated by all of the speakers at the conference, but it is certainly worth differentiating between the negative income tax advocated by neoliberals and neo-classical economists (of which the US earned income tax credit is an instance) and the basic income guarantee, which would be unconditional (except, perhaps, ofr citizenship), and hence not means-tested or tied to employment.

What are the technocrats supposed to be doing, again?

Dean Baker:

If Bernanke Did Not Know the Fed's Mission, Would That Be News?

Not at the WSJ, nor it seems anywhere else. Yesterday, Federal Reserve Board Chairman Ben Bernanke referred to the "our dual mandate, which is growth and inflation." In fact, the dual mandate is full employment (defined as 4.0 percent unemployment) and price stability. Presumably Bernanke had unemployment in mind when he said "growth," but it striking that he would not use the right term. The two are of course not synonymous.

Here's a better explanation of the dual mandate than the Wikipedia entry Baker points to.

UPDATE: More grist for the mill here.

What sort of activity is exchange?

I've been reading a bunch of Arendt, and, in light of my recent re-reading of Sohn-Rethel, I've noticed something both odd and, I think, revealing about Arendt's understanding of the vita activa--she completely overlooks commodity exchange as a distinctive form of activity.

Arendt's overall project, post-Origins of Totalitarianism, is centered around a rearticulation of active or practical life as of principles and a dignity separate from but equal to that of contemplation. I'm very sympathetic to this project, at least in such broad outlines. I'm especially attracted to her recognition of the fundamental plurality of activities, which sets her apart from all the mythologies of utilitarianism and rational choice action theory. However, I've always been nagged by a sense that her effort to separate out the various modalities of active life--labor, work, action--was itself a bit of a simplification or homogenization. However, nagging doubts do not an assessment make. Now I feel like I'm on somewhat more solid ground. Let me lay out the indicators of the problem:

Arendt's only prolonged discussion of exchange (that I know of) is in the "Work" section of The Human Condition (pp 159-67). The discussion is situated as it is because Arendt thinks that the exchange market is the public sphere corresponding to and growing out of work or fabrication, the making of persistent objects of use or artifacts. In Arendt's words, "homo faber, the builder of the world and the producer of things, can find his proper relationship to other people only by exchanging his products with theirs" (160).

But she immediately introduces a consideration that flagrantly contradicts this proper fit of the market to the artisans as producers. The sentence I just quoted continues by "explaining" this propriety; the artisan finds his proper relation to others in the exchange market "because the products themselves are always produced in isolation" (160-1). This sounds strange, I think, because we immediately think of assembly lines, factories, and cooperation when we think of production. Arendt has an explanation for this--basically, the division of labor within a process of production she associates with labor, the reproduction of life, and the conquest of production by the division of labor is therefore the subordination of work to labor--but I'll leave that aside for now. I think the plausibility of her insistence on the solitude of the artisan can be rescued by reference to such commonplaces as "too many cooks spoil the broth," and the certainty that doing anything "by committee" is sure to be a disaster from the standpoint of the quality of the end result. The work, for Arendt, is characterized by a singleness of intention and attention, and hence the artisan qua artisan is alone.

But for precisely this reason, the people who meet in the market are not artisans qua artisans, as Arendt herself recognizes. "The people who met on the exchange market, to be sure, were no longer the fabricators themselves," she writes; "when homo faber comes out of his isolation, he appears as a merchant and trader and establishes the exchange market in this capacity" (162-3). Therefore, she also claims that exchange value cannot be grounded in any "specific human activity" (164).

So, Arendt, it seems to me, is caught in the uncomfortable position of affirming both that exchange "develops without break and consistently" from "the world of the craftsman and the experience of fabrication" (166) and that this exchange presupposes a change in the personae and a dissociation from any actual activity of making things.

This is where Sohn-Rethel can meaningfully supplement Arendt. The recognition that commodity exchange is a separate mode of activity, and a specific from of human interaction, undermines the assumption that Arendt shares with the utilitarians and economists from whom she so radically diverges otherwise: the assumption that a generalized "utility" can be unproblematically extrapolated from the concrete uses of the objects we make. This presumptive link between use and utility is the unthought ground of modern economics, and exposing the absence of any such link is the ongoing task of the critique of political economy.

A Short Essay in Self-Criticism

So I have slightly mixed feelings about my essay in Marx and Contemporary Philosophy. Of course I'm thrilled to share space with so many of my Marxological heroes--Meikle, Postone, Murray, Carver, and Arthur, especially--from whom I have learned so much over the years. And I am quite happy with many aspects of the essay. And yet...

The root of the problem is that I'm re-reading Alfred Sohn-Rethel's Intellectual and Manual Labor for the first time since I was writing my dissertation. Unfortunately, I read it in German the first time, and apparently I didn't understand it nearly as well as I thought I did. It turns out that Sohn-Rethel should have influenced me far more than he did, and exactly on those questions with which the newly published essay is concerned. In other words, just as this essay is venturing out into the world on its own, I am looking up from my desk and crying, "Wait! You're not ready! Please let me make you a bit more presentable!"

Here's the issue: Understanding Marx's account of capital hinges on understanding the differences between exchange-value and use-value, and between abstract labour and concrete labour. Marx is adamant that exchaneg abstracts from use-value, and that, therefore, use-value plays no rule in the determination of the magnitude of value. Instead, the magnitude of value is determined by the abstract labour-time necessary to produce the commodity under given conditions. Thus, everything that is distinctive about Marx's approach gets off the ground here, where use-value and exchange-value part ways, and abstract labor-time appears as the substance of value. This is where all liberal economists (and most Marxist economists!) lose the thread (all of two pages into Capital). The question is, how does exchange abstract from use-value?

In my paper, I try to answer this question in what I guess could be called a phenomenological manner. I argue that the agents in exchange act as if use-value didn't matter, and that this "acting as if" amounts to a practical abstraction from use-value, which is intensified when a) labour-power becomes an object of exchange and b) is employed within a capitalist production process.

In the essay I waffle a bit on how intentional this abstraction is. My "as if" construction allows for the possibility that the consciousness of the agents does not apprehend what they do. But I also say things to the effect that we "disregard" the use-value of commodities in exchange, or "ignore" thereby the particular usefulness of labor. These formulations suggest, if not full consciousness, at least a sort of intentional structure to the practical abstraction.

In contradistiction to my rather muddled language, Sohn-Rethel is crystal clear: the abstraction from use effected by the practice of exchange is completely unconscious, and the furthest thing from the minds of the participants in exchange. Exchange excludes use in the sense that I can't exchange what I am using, or use what I am exchanging. This brute, physical abstraction from use is the original abstraction, and, according to Sohn-Rethel's analysis, contains all manner of counter-factual norms that structure the practice of exchange apart from any conscious or half-conscious intention. In fact, he even insists that the practice only works if the participants don't pay attention to the abstractions performed by it. I'm not sure I'm convinced by this bit, but he seems to think that exchangers have to think about use-value in order to practice an abstraction from use-value.

Regardles of this last point, I think Sohn-Rethel is invaluable for outlining a performance of abstraction that can proceed without any reference to a determining intentionality. My formulations in the just-published essay lend themsleves to an idealistic (that is to say, ideological) acount of exchange relations arising from conscious subjects. And that idealism of the act is worthy of endless criticism.

Anti-Delong: Postscript

In my last post I didn't touch on DeLong's other "explanation" for Marx's errors. I'll do this quickly--it's a minor thing, in some ways, but telling.

DeLong thinks Marx and Engels were led astray by the spectacle of hardship in pre-1850 Manchester, which he claims was not representative of England as a whole. He then writes:

Parliament began to regulate conditions of employment in the 1840s. Parliament began to regulate public health in the 1850s. Parliament doubled the urban electorate in 1867, just as volume 1 of Capital was published. Parliament gave unions official sanction to bargain collectively in the 1870s.

Has DeLong read--heck, has he even heard of--Chapters 10-15 of Capital? Marx was hardly unaware of these developments. Moreover, he even has a theory about their cause. He chalks them up to the working class getting organized! Parliament did not swoop down from on high bearing gifts--working class struggle predates and motivates all legislative victories, on Marx's account.

This goes back to what I previously called DeLong's belief in independent state action. It must be nice to be a neoliberal Keynesian who believes that intelligent and benevolent legislation will be the salve and the salvation of the worker--so long as it is directed by neoliberal Keynesians.

The final, ironic coda on DeLong's worship of the benevolent state is his closing line, in which he attributes Marx's late-born interest in Russia to, among other things, "the failure of the Paris Commune and the founding of the French Third Republic," without bothering to mention that the "failure" of the Paris Commune was its failure to withstand bombardment by the French Third Republic! After which, the French Third Republic demonstrated its benevolent feelings towards its working class citizens by summarily executing an estimated 30,000 of them (while arresting, deporting, and/or executing perhaps another 50,000 in the aftermath).

Anti-DeLong: Volume 3

DeLong explains the "intellectual origins" of Marx's errors:

Marx's beginnings in German philosophy, and the fact that he hooked up in the 1840s with Friedrich Engels whose family owned textile factories in Manchester. German philosophy, or perhaps rather Hegel.

Oh, goody. An economist riding the Hegel hobbyhorse. This should be fun.

DeLong produces a long quotation from Chapter 1, section 4 of Capital, on the fetishism of the commodity. He proclaims that he doesn't understand it at all. Then he conflates his own lack of understanding with lack of intelligibility, and attributes it all to Marx coquetting with the modes of expression peculiar to Hegel. Uh, no. Marx does use some Hegelian terminology in Chapter 1, but most of it is earlier, prior to section 4. I don't see a single Hegelism in the quotation DeLong proffers. But ignorance is not the limit of DeLong's special powers of not understanding. To wit:

To say that "the value relation[s] between the products of labour ... have absolutely no connection with their physical properties" is simply wrong: if the coffee beans are rotten--or if their caffeine level is low--they have no value at all, for nobody will buy them.

Marx does not deny this--he says explicitly and repeatedly that commodities must be use-values in order to bear exchange-value. But he denies that the use-value has any real connection with the exchange value, in the sense of determining it. We'll come back to this.

Nobody I talk to believes that "values" are objective quantities inherent in goods by virtue of the time it took to produce them.

Brilliant methodology. First of all, the whole point of Marx's discussion of fetishism is to say that when we exchange goods in the market we don't think to ourselves, "I'm exchanging a quantity of socially average labour for an equivalent quantity of socially average labour." As Marx puts it:

Men do not [...] bring the products of their labour into relation with one another as values because they see these objects merely as the material integuments of homogeneous human labour. The reverse is true; by equating their various products to each other in exchange as values, they equate their different kinds of labour as human labour. They do this without being aware of it. (Capital, Fowkes translation, pp. 166-7)

In other words, Marx doesn't think that values are objective quantities inherent in goods, nor does such a belief constitute the fetishism of commodities. And he says as much repeatedly. Rather the reverse. Values appear to be subjective, to be based on our individual, idiosyncratic preferences. In fact, according to Marx, they are outcomes of the social production process, which goes on behind our backs, as he puts it repeatedly. Back to DeLong:

If the combination of my wealth and its usefulness to me makes me value it the most, then I use it--it is to me what Marx calls a use value.

Use-value in Marx means the concrete functionality of a thing--what it does, in a very Aristotelian sense. There is a persistent tendency in economic discussions of Marx to identify his "use-value" with "utility" when in fact the two are radically divergent. Use-value is function, while utility is, depending on who you're reading, pleasure or preference. DeLong seems to avoid this particular error, at least here, which is admirable. But this does not put this passage beyond criticism, since he seems to imply that I regard a particular thing as a use-value only because I do not regard it as an exchange-value. But use-value is the primitive condition, not the derived condition. Moreover, he drives this home by saying that a thing is a use-value to me only if I value it the most. This is simply not true, both according to Marx and according to, I think, any fair minded consideration of affairs. I might relate to something as to a use-value even if I don't particularly want to use it. The only consideration here is that I treat the thing as a concrete particular, and not as an equivalent to a bunch of other things. The market is not the primary human horizon. Things are useful before (ontologically speaking) they are exchangeable. Indeed, DeLong seems to recognize this in the very next sentence:

But what Marx calls exchange values are really use values to others:

Exchange-values are really use-values to others. Of course DeLong thinks he's criticizing Marx here, when Marx says the same thing. For example, at the beginning of Chapter 2, Marx writes:

For the [commodity] owner, his commodity possesses no direct use-value. Otherwise he would not bring it to market. It has use value for others. (Fowkes trans., p. 179)

DeLong detects here a toehold for The Economists' Criticism of Marx (TM):

Things have value not because of the abstraction that socially-necessary labor time is needed to produce them but because of the concretion that somebody somewhere wants to use it and has something else that others find useful to trade in turn.

DeLong thinks that the latter condition is more concrete than the former, and that they are mutually exclusive. I think he's wrong on both counts.

That somebody somewhere has a use for what I sell is abstract in two senses. First, this "somebody somewhere" is both general and futural. The items on the shelves in the grocery store don't lose their value simply because no customer is currently in the act of buying them. Value refers, in DeLong's story as much as in Marx's, to an expectation grounded in a social division of labour, an expectation about what "people" want, need, etc. Second, the exchange of some goods for other goods posits the equivalence of the goods in question, an equivalence that abstracts from the particular functions of those goods. A sandwich is for eating (this is its use-value). A book is for reading. You cannot eat a book or read a sandwich. Hence, when we say that a book and a sandwich are equivalent as values (they each cost $4.95), we are grounding value in an abstraction, whether we consider this abstraction to be "utility" (Hegel's "need in general") or socially necessary labour-time.

Moreover, there is an equivocation in DeLong's use of "because." As I mentioned above, Marx does not deny that commodities must be use-values; on the contrary, he insists that every commodity must be a use-value, and that every commodity proves that it is a use-value, and that the labour that made it was useful labour, by being exchanged. But being a use-value does not explain why something has value, or why it has as much value as it does. As Hegel says, "man, as a consumer, is chiefly concerned with human products, and it is human effort that he consumes" (Philosophy of Right, s. 196). Or, if you prefer Smith's phrase, through commerce, we all come to rely upon "the assistance and co-operation of many thousands" (Wealth of Nations, I.1). Commodities have value, from this perspective, because the represent a certain amount of effort, effort conditioned, again, by the social division of labour and the development of the means of production. Recognizing that value is conditioned by need does not prohibit recognizing that value is also conditioned by socialized labour.

But this has been the realm of honest discussion, which we must now depart for the realm of hackery. Delong continues:

The distinction between use-value and exchange-value is not something invented by or peculiar to the capitalist mode of production: it is found in all human societies, no matter how large or small, no matter what the glue that holds them together.

Marx doesn't say that the distinction between use-value and exchange-value is peculiar to capitalist society, and you cannot have paid the slightest attention to Capital and come away with this opinion. He says right away on the first page of Chapter 1 that this distinction is definitive of commodities. Commodities existed before capitalist production--I should hope that DeLong recognizes this--and so did the distinction, therefore. However, that does not mean the distinction exists "in all human societies" indiscriminately. It exists only where commodity exchange of some sort goes on. As Marx writes in Chapter 2 of Capital:

Objects in themselves are external to man, and consequently alienable by him. In order that this alienation may be reciprocal, it is only necessary for men, by a tacit understanding, to treat each other as private owners of those alienable objects, and by implication as independent individuals. But such a state of reciprocal independence has no existence in a primitive society based on property in common, whether such a society takes the form of a patriarchal family, an ancient Indian community, or a Peruvian Inca State. The exchange of commodities, therefore, first begins on the boundaries of such communities, at their points of contact with other similar communities, or with members of the latter. So soon, however, as products once become commodities in the external relations of a community, they also, by reaction, become so in its internal intercourse. The proportions in which they are exchangeable are at first quite a matter of chance. What makes them exchangeable is the mutual desire of their owners to alienate them. Meantime the need for foreign objects of utility gradually establishes itself. The constant repetition of exchange makes it a normal social act. In the course of time, therefore, some portion at least of the products of labour must be produced with a special view to exchange. From that moment the distinction becomes firmly established between the usefulness of an object for direct consumption, and its usefulness in exchange. Its use-value becomes distinguished from its exchange-value. (translation slightly modified; my emphasis)

Then, from the misty-reaches of anthropological generalities, DeLong ricochets to the concerns of a contemporary academic economist:

...the labor theory of value [...] is simply not a very good model of the averages around which prices fluctuate. Socially-necessary labor power usually serves as an upper bound to value--if something sells for more, then a lot of people are going to start making more of them, and the prices at which it trades are going to fall. But lots of things sell for much less than the prices corresponding to their socially-necessary labor power lots of the time.

He's not even trying anymore. Marx says the magnitude of value is determined by socially necessary labour-time, not labour-power. Labour-power is a commodity, and hence has a value, and therefore cannot be the determiner of value, since what would explain its own value?

Finally, we come to the punch-line:

This matters because one conclusion Marx reaches is that markets and their prices are a source of oppression--that they aren't sources of opportunity (to trade your stuff or the stuff you make to people who value it more) but rather of domination by others and unfreedom: the system forces you to sell your labor-power for its value which is less than the value of the goods you make. And it is that conclusion that human freedom is totally incompatible with wage-labor or market exchange that leads the political movements that Marx founded down very strange and very destructive roads.

There's a funny conflation of "markets" and "wage labour" going on here, which is telling. Marx is not so much concerned with markets in general as he is with the market in labour-power. Capitalist production--and hence a society of generalized market relations--doesn't get off the ground (or stay in the air), according to Marx, unless there are a whole lot of people who don't have any "stuff" to sell, and so have to sell their labour-power. Their ability to do so on the labour market is most certainly a "source of opportunity" not to starve to death--Marx does not deny this--by selling their labour-power to those who "value it more" in the precise sense that they have a use for labour-power (since they own the means of production) that its bearers do not (since, not owning the means of production, their labour-power is useless to them).

DeLong has quite simply missed Marx's entire argument. And as convenient as it might be for him to blame this on Hegel, I think he amply betrays a real unwillingness "look at the thinker, Karl Marx, and what he actually wrote and thought."

Anti-DeLong: Volume 2

According to DeLong, Marx the economist said three good, still important things, and three bad things. However, the three good, important things turn out to be either so qualified by DeLong or so attenuated in their attributability to Marx that DeLong actually gives Marx almost no credit at all. Thus, he commends Marx's insistence on capitalism's tendency towards crisis, but then adds: "However, I don't think that his theory of business cycles and financial crises holds up." He praises Marx for being:

among the very first to see that the industrial revolution was giving us the statues of Daedalus, the tripods of Hephaestus, looms that weave and lyres that play by themselves--and thus opens the possibility of a society in which we people can be lovers of wisdom without being supported by the labor of a mass of illiterate, brutalized, half-starved, and overworked slaves.

But, of course, Marx didn't think this could happen so long as technology served as fixed capital. DeLong ignores the sarcastic conclusion of Marx's discussion of the ancient dream of the statues of Daedalus:

Oh! those heathens! They understood, as the learned Bastiat, and before him the still wiser MacCulloch have discovered, nothing of Political Economy and Christianity. They did not, for example, comprehend that machinery is the surest means of lengthening the working-day. They perhaps excused the slavery of one on the ground that it was a means to the full development of another. But to preach slavery of the masses, in order that a few crude and half-educated parvenus, might become “eminent spinners,” “extensive sausage-makers,” and “influential shoe-black dealers,” to do this, they lacked the bump of Christianity.

Finally, DeLong praises Marx as an economic historian of England from 1500-1850. "Most important, I think, are his observations that the benefits of industrialization do take a long time--generations--to kick in, while the costs of redistributions and power grabs in the interest of market efficiency and the politically-powerful rising mercantile classes kick in immediately. You have to take seriously the idea that the industrial revolution did not make most or even many people better off right away." This renders toothless Marx's discussions of the struggles over the working day, the rise of industrial machinery, and the processes of primitive accumulation. In DeLong's estimation, the point is that industrialization didn't make many people better off right away, and he only nods to "the costs of redistributions and power-grabs." But Marx's point is rather that capitalization and industrialization make most people far worse off right away, so much worse off that a lot of them starve to death or die very young or spend their lives in work-houses. This is more than just tweaking the cost-benefit analysis by emphasizing the long time-lag before the benefits start to kick in.

After this, the Bad Things are rather anticlimactic, and a bit vague. Marx believed:

1. that "the market system simply could not deliver a good or half-good society but only a combination of obscene luxury and mass poverty."
2. that "people should view their jobs as expressions of their species-being: ways to gain honor or professions that they were born or designed to do or as ways to serve their fellow-human."
3. "that the capitalist market economy was incapable of delivering an acceptable distribution of income for anything but the briefest of historical intervals."

The second is just not true, in several ways at once. First, it turns Marx back into an ideologist--since work could never be anything other than an expression of our species-being, the problem is reduced to how people view their jobs; hence, change people's consciousness and voila! Second, DeLong has turned Marx into an advocate of the medieval guilds, which is just bizarre. Third, Marx never argued that work would become beneficence or philanthropy in communism; rather, he insisted that it must become a development of one's individuality.

The first and third are just two versions of the same complaint--that Marx saw capitalism as inherently contradictory, as crisis-prone, and as productive of misery in the same measure as wealth--but they are both confused on important points.

The first version subliminally folds the state into "the market system" as not merely an endogenous development but literally as an organ of the market. This is odd, to say the least. The problem with number three is that he turns Marx's theory of classes into a theory of income distribution. But class has nothing to do with income for Marx, except via a whole series of mediations. What makes you a member of the working class is not your income level. Certainly Marx did think that wages for the mass of workers would always gravitate towards subsistence wages, but DeLong says nothing to indicate why this is not true. Certainly, as above, state action can raise the minimum wage locally, but that is very different from raising the real minimum wage globally.

But this distinction between local and global wages pushes DeLong into the libertarian corner. If "technological progress and capital accumulation" alone are capable of raising the minimum wage and distributing wealth at the global scale, beyond the jurisdiction of any state, then why is this not also true at the local level? Or, if wages only rise globally because of the concurrence of local regulations, then what is to prevent capital flight to those jurisdictions with the lowest labour costs (precipitating a race to the bottom)? Or is everything dependent upon the good will of governments entrusting economic policy to enlightened Keynesian technocrats? If so, then Lord help us! That's not a mechanism, but a daydream, painted on the wind.

But DeLong saves the best for last. Having muddled his way through the good and bad of Marx's economics, he now gives himself the task of explaining the "intellectual origins" of Marx's errors. I'll deal with this in the third and final volume.

Anti-DeLong: Volume 1

Brad DeLong is a successful academic economist. He is a professor of economics at UC Berkeley. Before Berkeley, he was an economic adviser to the Clinton administration, and before that he was an untenured associate professor* at Harvard. (You can see his CV here.) He is one of the more prominent liberal economists in the US (he refers to himself as a "neoliberal").

So when Brad DeLong writes a lecture entitled "Understanding Karl Marx," it does not represent just some guy's opinion. DeLong's understanding of Marx can be taken to be representative of elite academia, of liberalism, of contemporary economics as a discipline. Not perfectly so, of course, since theses domains are chock full of disagreement and contention, but representative enough that one can say with some confidence that whatever DeLong thinks about Marx is at least a respectable take on the fellow. And when DeLong says early in his lecture--"Let us go back and look at the thinker, Karl Marx, and what he actually wrote and thought"--one has every reason to expect a careful, scholarly examination of Marx, even if it is one with which one might have disagreements.

One would then be extremely disappointed.

DeLong's lecture is stunningly and doggedly wrong, and betrays a callous ignorance of both Marx's texts and the scholarship on those texts, all in the service of trying to convince the reader (or listener) that Marx was a silly, wrongheaded, and dangerous thinker who is dead, dead, dead so far as philosophy, politics, and economics are concerned.

I want to wade through this piece by piece. This will take a while. I'll try not to be too tedious or too humourless.

DeLong begins the substantive part of the lecture by telling us that "Karl Marx had a three part intellectual trajectory"--philosopher, political activist, economist. He doesn't have much of anything to say about Marx the philosopher, but what he does say is pretty egregious:

At the start of his career he believed that all we had to due to attain true human emancipation was to think correctly about freedom and necessity.

I would love for DeLong to point to a single text where Marx writes anything that can be construed this way, or to a single secondary source that attributes this belief to the young Marx.

He has more to say about Marx as political activist, but it's not any better. He claims that Marx had "three big ideas" as a political activist:

1. that capitalism replaced masked domination with naked exploitation,
2. that the bourgeoisie would never appease the proletariat with income-redistribution, even though it could, and
3. that factory work would lead to proletarian class consciousness and revolution.

DeLong doesn't think much of any of this: "I see very little in Marx the political activist that is worthwhile today." I have four rejoinders:

First, it seems pretty obvious that DeLong is basing his entire portrait of Marx's political activism upon The Manifesto. Hey, it's a great text. Still, the claims made there are: a) manifesto-esque, in that they have a hortatory and polemical thrust that make it problematic to read them simply as descriptive claims about how the world is; and b) based on an as yet immature critical appraisal of political economy, and are therefore revised and qualified in many ways by what Marx writes elsewhere. Now DeLong may think he has foreclosed this second complaint by claiming that Marx is sequentially a philosopher-activist-economist. In fact, I think my complaint points up the uselessness of the sequential narrative. Marx began his critique of political economy in 1844, and both it and his political activity persisted right up to his death. they were always inseparable, and so any serious examination of the Manifesto has to take into account Marx's shifting approaches to the questions addressed there. This is not to say that a careful reading of the Manifesto would not be a valuable and defensible way to approach Marx's political activism. But DeLong does not give us that. This can be seen from the specific claims he attributes to Marx qua activist.

Hence, second, let's look at the first of those claims:

that while previous systems of hierarchy and domination maintained control by hypnotizing the poor into believing that the rich in some sense “deserved” their high seats in the temple of civilization, capitalism would replace masked exploitation by naked exploitation. Then the scales would fall from people's eyes, for without its masking ideological legitimations unequal class society could not survive. This idea seems to me to be completely wrong. Cf. Antonio Gramsci, passim, on legitimation and hegemony. See also Fox News.

Marx certainly claims in the Manifesto that:

The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It has pitilessly torn asunder the motley feudal ties that bound man to his “natural superiors”, and has left remaining no other nexus between man and man than naked self-interest, than callous “cash payment”. It has drowned the most heavenly ecstasies of religious fervour, of chivalrous enthusiasm, of philistine sentimentalism, in the icy water of egotistical calculation. It has resolved personal worth into exchange value, and in place of the numberless indefeasible chartered freedoms, has set up that single, unconscionable freedom — Free Trade. In one word, for exploitation, veiled by religious and political illusions, it has substituted naked, shameless, direct, brutal exploitation.

But to understand this "naked, shameless, direct, brutal exploitation" as the end of ideology is just silly. The nakedness of exploitation in capitalism is not equivalent to the nakedness of power. This points to an underlying confusion about just what exploitation is.

Third, there's "could" and there's "could." The redistribution DeLong suggests that the capitalist class engage in to secure its own perpetual domination is either one that allows most wage-labourers to acquire the means of production or it is not. If it is then it spells the end of capitalism, if it is not, then it just increases the cost of labour-power, increases unemployment, and undoes itself. Certainly the 20th century saw a vast array of state interventions into trade and labour markets in order to ameliorate the class struggle and forestall revolutionary movements. Whether or not such efforts will have the necessary traction in a NAFTA-ized world market remains to be seen, but Marx's point is that within a world of free trade capitalist nations stand in the same relation to one another as competitor firms, with the same incentives to raise productivity and decrease labour costs. So long as capital is more mobile than labour--which is to say, always--local jurisdictions will compete to attract capital, and this competition will be bad for workers.

I also think that DeLong's faith here betrays his belief in something like independent state action. Marx wanted to trace all state action back to the struggle between the proletariat and the bourgeoisie because he believed that the state would only protect the workers' interests when they forced it to. Nothing about the history of Keynseanism stands as an obvious counterexample.

Fourth, and finally, DeLong thinks Marx's optimism about factory work leading to organization and class-consciousness was mistaken. He writes:

Active working-class consciousness as a primary source of loyalty and political allegiance was never that strong. Nation and ethnos trump class, never more so that when the socialists of Germany told their emperor in 1914 that they were Germans first and Marxists second.

This is a classic case of mistaking hortatory rhetoric for objective analysis. That Marx talks at times as if the revolution will be the inevitable outcome of capitalist development did not prevent him from advocating and taking part in the political work that takes nothing for granted. What DeLong fails to understand is that preaching inevitable working-class unity and revolution is a political tactic for forging working-class unity and promoting revolution. It's a performative speech act. And it was an incredibly important--and effective--one within the European social democracy movement in the late-19th and early-20th centuries.

And I can think of a whole slew of instances that "more so" demonstrate other allegiances trumping class--like when the head of the German Social Democrats ordered the fascist shock troops of the Freikorps to assassinate Rosa Luxemburg and Karl Liebknecht, or when Stalin did just about everything Stalin did.

Still, this is all side-show--why would anyone take seriously an academic economist's judgments of Marx's political activism?--to the main concern: the assessment of Marx qua economist. I'll start looking at that in the next post.

* The original version of this post erroneously claimed that DeLong had tenure at Harvard.

Nineteenth Century Political Philosophy

A draft version of the syllabus for my upcoming course:

Philosophy 445: Nineteenth Century Political Philosophy
Government and Society: The Rise of Political Economy

The Nineteenth Century saw the dramatic decline of the classical model of political philosophy that had dominated the previous two centuries, and had consisted largely of defining the natural rights of persons and proposing the sovereign legal framework within which these rights would be best respected. The modern political order had taken hold to such an extent that such encyclopedic articulations of that order were no longer necessary. Instead, the new century was marked by “sociological” and historical investigations into the conditions of modernity (Tocqueville, Burkhardt, etc.), polemical defenses of and attacks upon the ascendant modern order (Constant, Nietzsche, etc.), imaginative utopian schemes (Fourier, Cabet, etc.), and most importantly for the purposes of this class, increasingly elaborate and rigorous efforts to establish a scientific discourse that would amount to a social physics of this modern order. This aspirational physics of society was originally called “political economy” but came to be known simply as “economics.”

In this course, we will consider the rise of economics by observing its effect on two of the great tomes of Nineteenth-Century political thought: Hegel’s Philosophy of Right and Marx’s Capital. The former is, in a sense, the last of the classical articulations and large-scale apologies for the new social and political order. Hegel was deeply impressed by Adam Smith early in his life, and was deeply respectful of political economy’s claim to explain the laws of motion of modern society. In the Philosophy of Right, he writes; “Political economy is the science which must go on to explain mass relationships and mass movements in their qualitative and quantitative determinacy and complexity. This is one of the sciences which have originated in the modern age as their element” (§189). Nonetheless, Hegel was also quite critical of the civil society described and advocated by political economy, and emphasizes the necessity that other sources of meaning and community justify civil society.

Marx, on the other hand, is the consummate critic of modern society, and the subtitle to Capital is “A Critique of Political Economy.” Economics is the primary ideology of the modern world, according to Marx, mystifying and sanctifying historically and violently created relations such that they appear as natural and immutable, the destiny of human life. However, Marx’s relationship with political economy is just as complex as Hegel’s, in that he too accepts that the economic relations are very real and very determinative of modern social and political existence. Our investigations of these two works will be illuminated by supplementary readings from political economy itself. We will seek to understand the basic outlines of both classical political economy and the rise of marginal utility theory that overturned the classical model in favor of what would become neo-classical economics. We will look carefully at Hegel’s attempt to synthesize this economic model of society with classical and even ancient understandings of the political republic. Finally we will delve into Marx’s critique of political economy. The readings for this course are extremely difficult, and will therefore require patience and careful attention. Our course meetings will be spent in close, interactive examination of the texts.

Reading and Lecture Schedule:

Weeks 1-7

• Hegel’s Philosophy of Right

Supplements:

• Smith, from The Wealth of Nations
• Ricardo, from On the Principles of Political Economy
• de Tracy, from “Elements of Ideology”
• Constant, “The Liberty of Ancients [and] Moderns”
• Mill, from Principles of Political Economy

Week 8 Mid-winter Break

Weeks 9-14

• Marx’s Capital

Supplements:

• Jevons, “General Mathematical Theory of Political Economy”
• Pareto, “New Theories of Economics”
• Marshall, from Principles of Economics

Chairman Romer

The Future's So Bright...

Unemployed Negativity has a nice post up about neoliberalism and relational social ontology. Here's an excerpt:

Yann Moulier-Boutang has underscored the importance of grasping the paradoxical logic of externalities in contemporary capitalism. Traditionally defined externalities are the various impacts that a given transaction has on those who are not party to the transaction. Examples of this include such “negative” externalities as pollution and such “positive” externalities as the unintended cultural and social benefits of the formation of cities. In each case there are effects that are not paid for, not a part of anyone’s calculation. As Moulier Boutang presents it, “externalities are the representation of the outside of the economy acting on the economy.” One could push this a bit further to say that externalities are the way in which a neoliberal society imagines its constitutive conditions, they are everything that do not correspond to the strict calculation of cost for benefit. As such they represent the economy’s, or the market’s, attempt to represent its outside.

The problem is that these externalities have become increasingly difficult to ignore. This is especially true with respect to the environment, as a negative externality, and the knowledge involved in the production process, as a positive externality. There is a historical argument here about the transformation of capital, and it should be viewed critically, perhaps even dialectically, to recognize the continuities that underlie the changes, the complex mix of the new and old that constitutes any conjunction. It seems bizarre to say that the “environment” and “intellectual labor” are in any way new, but at the same time there is a certain manner in which they have recently become unavoidable. Capital’s negative effects on the environment go back to the very beginning, but have recently become unavoidable due to the density of population and intensity of accumulation; in other words, there are no new colonies left to exploit. At the same time capital has always put to work the accumulated knowledge of society, but for a long time it was able to work with the knowledge hierarchies that it found ready made, the medieval system of the university, the feudal system of guilds, etc, but now it must rewrite knowledge in its own image.

I'd like to compare this critical account with a triumphalist account of the same thing: an interview with Paul Romer from reason. Here's a degustation:

reason: In terms of real per capita income, Americans today are seven times richer than they were in 1900. How did that happen?
Paul Romer: Many things contributed, but the essential one is technological change. What I mean by that is the discovery of better ways to do things. In most coffee shops these days, you'll find that the small, medium, and large coffee cups all use the same size lid now, whereas even five years ago they used to have different size lids for the different cups. That small change in the geometry of the cups means that somebody can save a little time in setting up the coffee shop, preparing the cups, getting your coffee, and getting out. Millions of little discoveries like that, combined with some very big discoveries, like the electric motor and antibiotics, have made the quality of life for people today dramatically higher than it was 100 years ago. The estimate you cite of a seven-fold increase in income--that's the kind of number you get from the official statistics, but the truth is that if you look at the actual change in the quality of life, it's larger than the number suggests. People who had today's average income in 1900 were not as well off as the average person today, because they didn't have access to cheap lattés or antibiotics or penicillin.

Three cheers for positive externalities!

The understanding which most sharply distinguishes science from the market has to do with property rights. In the market, the fundamental institution is the notion of private ownership, that an individual owns a piece of land or a body of water or a barrel of oil and that individual has almost unlimited scope to decide how that resource should be used. In science we have a very different ethic. When somebody discovers something like the quadratic formula or the Pythagorean theorem, the convention in science is that he can't control that idea. He has to give it away. He publishes it. What's rewarded in science is dissemination of ideas. And the way we reward it is we give the most prestige and respect to those people who first publish an idea.

Here is some notion that the positive externalities cannot be internalized without endangering the whole project. Romer gets even more explicit about it.

There are very good theoretical reasons for thinking that market and property rights are the ideal solution for dealing with things, but there are also strong theoretical reasons for thinking that in the realm of ideas, intellectual property rights are a double-edged sword. You want to rely on them to some extent to get their benefits, but you want to have a parallel, independent system and then exploit the tension that's created between the two.

Thus, there must be a strong distinction made between things and ideas. For things, a system of absolute individual property rights is ideal. this means that there are no meaningful non-internalizable negative externalities of the sort environmentalists and neo-marxists are worried about. If every "thing" is given over to the market, that would solve our externalities problems. For ideas, however--the fruit of "intellectual labor"--there is an absolute need to maintain a realm of positive externalities, and to institutionalize this realm as the realm of scientific research, etc. So long as intellectual labor can be exploited in this manner, the negative externalities can always be managed and re-internalized.

It is hard to convey how amped up and optimistic both the interviewer and Romer are about all this, but I think it is worth noticing just how strange their rose-hued future is. They want us to get excited about the prospect of constant and ever-expanding intellectual labor for the sake of staving off ecological and resource-scarcity crises. Their optimism comes from their conviction that we will always succeed in doing so, or else recover from our failures to do so, or else be replaced by other societies that will succeed better than us in doing so.

Therefore, I'd like to propose a slogan for neo-liberalism, something Romer et al. could put on banners and posters: Maximize positive externalities for the sake of minimizing negative externalities!* Inspiring, no?

* Translation: We need more and more people spending more and more time and energy more and more frantically thinking up ingenious ways to save our asses!

From Beneath, It Devours

There's been a sudden resurgence in public references to Marx since Obama's "bitter" remarks. Much of it has been fueled by the perceived equivalence of Obama's claim about small-town voters and Marx's claim in the "Introduction" to his critique of Hegel's Philosophy of Right that "religion is the opium of the people." Whatever the merits of such an interpretation (they're slight, in my opinion), a recent post by publius over at Obsidian Wings (following up on this post by Mickey Kaus) has shifted the argument ever so slightly:

To clarify, whatever Obama intended to say, the resulting debate has turned — as Kaus says — Marxist. The debate has evolved into a discussion of whether the cultural preferences of bitter Pennsylvanians stem from a lack of economic opportunity. To put the question in more stark Marxist terms — are Pennsylvanians’ cultural preferences (i.e., the superstructure) determined by economics? If so, then those cultural preferences will presumably shift if people become more economically secure.

Publius goes on to argue that the same logic underlies the Bushies' war on Iraq: "the neocon vision shares some Marxist assumptions. Specifically, it too sees religion and radicalism as superstructure. Change what lies beneath and you’ll change what rests on top, or so the theory goes."

Any argument that produces the conclusion that the neocons are Marxists performs a reductio ad absurdum on itself. So where did this argument go wrong? I think it goes wrong as soon as it supposes that the determination of political and religious life by the economy is a Marxist position. The base/superstructure image deployed by Marx is, I would argue, taken over wholesale from the tradition of liberal political economy going back to Smith and Montesquieu.

The spread of material abundance along the vector of expanding markets is supposed to bring with it civilization, in the sense of non-violence, tolerance, and enlightened self-interest. You can find this thesis defended by Hume, by Kant, by Mill, by Constant--indeed by most every liberal since the birth of liberalism. Determination of the cultural and political superstructure by the economic base is precisely what "political economy" names.

Therefore, while there is a common thread linking Obama's comments (at least as they were received) and Bush's war strategy, it is the common thread of liberal political economy.

Marx's relation to this tradition is complicated (see the post below re: Malthus), but I don't want to deny that there is a powerful strand of Marxism that is consistent with political economy. Kaus mentions vulgar Marxism, and I'd be happy to pin this label on economic Marxism. Economic Marxism draws different lessons from the premise it shares with economic liberalism, but it does share this premise.

Nonetheless, Marx sub-titled Capital "A Critique of political Economy," and there is an equally robust strand of Marxism that takes of this anti-economistic challenge. I would note at least three important theses that differentiate this Marxism from the base-determines-superstructure model of political economy:

1. The mode of production is not reducible to a mode of distribution. That is, the way we produce is prior to the economic questions focused on by political economy.
2. The mode of production of capitalism is fundamentally revolutionary and disruptive. That is, the "base" is not a stable foundation upon which economic, political, and cultural institutions might arise. Rather, the mode of production constantly undermines and subsumes whatever seems to aspire to an external or independent existence. From beneath, it devours.
3. The mode of production does not explain itself, but was brought into being and is continually maintained by extra-economic violence, what Marx calls "primitive accumulation." (On which, see this excellent review of There Will Be Blood by Unemployed Negativity.)