by Alan Briskin | Collective Folly, Conscious Capitalism, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Seven, Part Two
How Wealth Became Concentrated and the Poor Were to Blame: What Should Be Done with the Poor?
For the record, Harrington tried to address the dilemma of what constituted poverty, but his efforts backfired. He acknowledged that poverty was a social and historical construct, different in different time periods and cultures. He believed, like Roosevelt, that those without minimal levels of health, housing, food, and education were poor — especially when those same resources were available to the larger population. It is with this definition that he arrived at the 40–50 million figure of poverty in 1962.
Harrington came to believe that poverty was a function of reinforcing social elements that shaped an individual’s outlook. The outlook of the poor was different from the outlook of those who, like my parents, had hope for a better future. In that context, he believed that government had a critical role to play, but the real backdrop was the inadequate functioning of our economic and social institutions. Poverty resided in diverse physical locations and with different populations, but all faced similar obstacles. What were they?
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
FLASH POINT
Mitt Romney Criticized By Franciscan Friars For Comments On The Poor
Alex Becker
Huffington Post
Posted: 08/09/2012 2:36 pm Updated: 08/09/2012 3:55 pm
WASHINGTON- The Franciscan Action Network (FAN), a Catholic faith-based advocacy and civic engagement organization, is strongly criticizing Mitt Romney’s recent ads and rhetoric regarding welfare programs and welfare recipients, urging him to spend some time in low-income communities.
“Our Christian tradition teaches that we are to treat the poor with dignity and to prioritize the poor in our policies as a society,” the organization said in a press release on Thursday. “At a time when millions are struggling financially, it is degrading to talk about the ‘dependency’ of people hurting in this economy, as Gov. Romney did recently.”
Rhett Engelking, a secular Franciscan in Milwaukee and member of FAN, has even personally invited Romney to visit with the low-income people he assists. “Political leaders would not talk about the poor in demeaning ways or cut job training programs if they spent more time with the people they are affecting with their policies,” he said.
While faith-based anti-poverty and charity organizations have often criticized candidates and lawmakers for a perceived unwillingness to highlight and tackle issues affecting the very poor, FAN claims Romney’s rhetoric goes a step further, unfairly using welfare recipients as political props.
He understood something that has only recently been supported statistically by studying geographic zip codes. Harrington argued that poverty was a toxic mix of factors that included poor health, minimal access to health care, high-crime neighborhoods, hostile police presence, failing schools, generational cycles of unemployment, low income, family instability, and inadequate diets. Overcoming any one of these factors was possible, but together they represented a vicious cycle of cumulative obstacles whose aggregate outcome was failure. For example, I have estimated that there are zip codes in my hometown of Oakland, California, in which the chances of an eighth grader eventually graduating from a four-year college are less than 6%.
A few miles away in another zip code, on the border of Oakland, the figure is closer to 90% graduation with 98% planning to attend some form of college. Naturally, the attitudes and resources of the group in which 98% aspire to college will be different from those with little evidence that they will succeed. It was in this context that Harrington attempted to address a “culture of poverty,” and the term stuck in the worst possible way.
What Harrington was hoping to communicate was the hellish interlocking forces that resulted in a systematic repudiation of individuals and the groups they came from. He added that it was not uncommon to find an attitude of futility and lack of self-worth within these settings — but he stressed that these attitudes were the symptoms, not the disease. For Harrington, the absence of what he called positive aspirational qualities was the psychological demarcation separating this new form of poverty from others, enclaves so beaten down that the individual response was passivity, self-destructive behavior, and outbursts of violence. He believed that somehow if the larger society became conscious of such a destructive spiral, they would be inspired to change it.
Looking back with hindsight, we might wonder what the hell he was thinking. Instead of altruistic regard, a backlash against the symptoms of poverty became the rallying cry for both the left and the right. The left wanted to create legislative policies and fund government programs to fix the problem; the right vilified the subjects of Harrington’s findings – the poor and marginal – as failing due to their own poor attitude and dismal culture.
Harrington’s analysis, viewed as initially catalyzing John Kennedy’s interest in the subject of poverty and later Lyndon Johnson’s war on poverty, inadvertently provided fodder for the belief that poverty was simply other. The poor were subject to character flaws of epic dimensions. These included lack of impulse control, limited sense of self, manipulativeness, unwillingness to contribute to society, and being destitute by nature if not by choice. Daniel Moynihan, a drinking buddy of Harrington’s at the White Horse Tavern in Greenwich Village and former assistant secretary of labor under both Kennedy and Johnson, compounded the problem with a report a few years later focusing on the inner city titled The Negro Family: The Case for National Action.
Now poverty would be construed as other and black, though some might question that as redundant. What is unquestioned is that the same forces that polarized during Roosevelt’s time in office now found a new subject to disagree about with each other. What Harrington tried to portray as a byproduct of failing economic and social institutions cutting across age, race, and geographic region instead became the stigmatization, if not demonization, of the poor. The culture of poverty was for many the confirmation of an existing belief. The poor were to blame for having too many children, fostering negative attitudes, lacking personal responsibility, and demonstrating an absence of respect for law and order. The poor would drag us all down if we let them.
A decade or so later, Ronald Regan would campaign against welfare queens driving Cadillacs and taking money out of our collective pockets with their welfare checks. His message was that government should not aid and abet personal misconduct. Years later, Bill Clinton would negotiate new welfare reform legislation that mandated “chastity training” for poor single mothers. As Barbara Ehrenreich pointed out in an article on the 50th anniversary of The Other America’s publication, the language of a “culture of poverty” began as a jolt of social consciousness but devolved into the cornerstone of conservative ideology. The assault from the right was that poverty was caused “not by low wages or a lack of jobs, but by bad attitudes and faulty lifestyles.”
Meanwhile, the ghost of Karl Marx snickers on a stool at the Red Lion Pub. Ehrenreich, who knew Harrington, noted the subterranean forces that may have driven Harrington to use the “culture of poverty” as an explanatory principle. “Maurice Isserman, Harrington’s biographer, told me,” she wrote, “that he’d probably latched onto it in the first place only because ‘he didn’t want to come off in the book sounding like a stereotypical Marxist agitator stuck-in-the-thirties.’” Harrington, a socialist, probably didn’t want to be dismissed for evoking the one who could not be named.
In many respects, Harrington succeeded by not being identified with Marx. However, by avoiding one pitfall, he fell into another. By offering up the idea of culture as a way to understand what was happening in America, he provided an escape valve for both sides of the debate. One side viewed the poor as evidence of an unfulfilled contract within an affluent society needing remedy; the other viewed them as a danger to society. Neither really wanted to talk about the distribution of wealth or the structural basis of social inequality. Icebergs will melt and buildings will fall before we get to that one.
Next Week:
Chapter Eight: Planetary Consciousness Arises, Cautiously
by Alan Briskin | Community, Conscious Capitalism, Photography, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Seven, Part One
How Wealth Became Concentrated and the Poor Were to Blame: “Paupers are Everywhere”
1962
“Paupers are everywhere.”
~ Complaint heard from Queen Elizabeth, late 16th century, after returning from travels in the English countryside.
Michael Harrington, political activist, socialist, and professor of political science at Queens College, was no Queen Elizabeth, but his research on poverty came to the same conclusion. As he wrote in his book The Other America, he was horrified to find that 40 to 50 million Americans lived in poverty, a fifth to a quarter of the entire US population in 1962. Where were they hiding?
He believed that a subtle shift had taken place in the psychology and culture of poverty. Whereas the tenements of the early 20th century were seething with a mixture of races and immigrants, there was enough diversity of intelligence, backgrounds, and aspirations to create a modicum of hope and vitality. There was poverty, disease, and poor housing in the past, but they were circumstantial obstacles to be overcome in a country that could provide social mobility and the promise of riches. Something about the very nature of poverty had changed from these historical antecedents.
My father and mother were never rich, but through hard work and frugality they found a way to make a living and see that their children might have more education than they did. There was hope for a better future. In the ’30s, when my parents were teenagers, the context for poverty was the Depression, and it gave them a collective sense of shared hardship and sacrifice. Poverty was a marker not so much of the person as of the times, a condition of society. The poor, which included tens of millions on low wages, had more of a voice politically and were not necessarily stigmatized by their circumstances. The 1930s were also a turning point for unions, which were able to flex their collective muscle and found themselves, just as Marx predicted, able to aggressively pursue their members’ own economic self-interest relative to wages and work rules.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
In the late 1930s and early ’40s, the world itself was at risk. The United States went from an economic depression into a fight with an enemy believed to be the incarnation of evil. These were tough times, and the sheer exuberance of victory over evil by the mid-’40s made it easier to believe that the forces of poverty were lessening as well. In the late ’50s and early ’60s, when my parents were finally finding success and Harrington did his research, there may have been a willingness to overlook poverty as a still important aspect of the social fabric requiring attention.
Poverty, as Harrington saw it, had now matured into something separate, multigenerational, and psychological. Separate in the sense that there were whole towns, cities, or parts of cities throughout the United States that were stuck in a downward spiral. Economic and social vitality was in the business hubs of cities, in suburbs where the affluent raised their children, and along geographic corridors, not in rural areas or urban centers, where poverty was concentrated.
Small towns were adversely affected by the greater dependence on skilled labor and technology. Smaller farms were being marginalized by greater mechanization and corporatization. Minorities increasingly congregated within inner cities, which were referred to as slums and characterized by a pervasive attitude of futility. Those who could exit such places did, and the remaining were hemmed in by tight social beliefs and attitudes. The more rural or isolated an area, the more cut off from diverse lifestyles and perspectives, the more insulated and rigid became the social milieu, and the more hostile and unforgiving was its view of others.
No longer was poverty simply across the tracks; it was a contagious mindset of scarcity, fear, and resentments. It was passed down generation after generation and socially reinforced by members of its own community. Poverty and economic hardship manifested psychologically through symptoms of anger, cynicism, and intolerance. The swelling anger that Marx predicted was not crystallized between workers and owners of capital. No, it was fragmented across race, religious, geographical, and educational divisions.
Where were the poor? In the ’60s, the poor were increasingly becoming invisible — the aged tucked away in old-age homes, poor children in failing schools, minorities in slums, rural poor in the countryside just a stone’s throw away from tourist travel. A decade later, when I worked at a state prison located in St. Johnsbury, Vermont, my job was to find local employment for inmates finishing their sentences. My territory was called the Northeast Kingdom, an area as poor as Appalachia. A tourist would never have known this from driving through the area, however — a year-round recreation destination for skiing, fall foliage, and maple syrup. How sweet it might have looked to a person just passing through.
Who were the poor? If you measured the poor by material possessions such as a television set, a refrigerator, or even a decent pair of sneakers, nearly everyone was well off. If you measured only by income, you included many still starting out toward success. If you measured by psychological factors, you risked subjective prejudice. The very idea of poverty was becoming porous, fluid, and ambiguous. Poverty was not only physically becoming separate from society; it was also psychologically separating itself from social awareness, as something to be avoided. Poverty was no longer circumstantial, as it had been for my parents, or temporary until one found productive outlets; it was an all-encompassing and pitiful predicament to be in. Harrington believed, however, that if we looked at poverty with an open heart and mind, social conscience would well up in our breast. Over a million copies of his book were purchased, a surprising number to be sure, and suggesting that something unsettled was still nagging in the American psyche.
Next Week: Chapter Seven, Part Two: What Should Be Done with the Poor?
Harrington understood something that has only recently been supported statistically by studying geographic zip codes. Harrington argued that poverty was a toxic mix of factors that included poor health, minimal access to health care, high-crime neighborhoods, hostile police presence, failing schools, generational cycles of unemployment, low income, family instability, and inadequate diet. Overcoming any one of these factors was possible, but together they represented a vicious cycle of cumulative obstacles whose aggregate outcome was failure. For example, I have estimated that there are zip codes in my hometown of Oakland, California, in which the chances of an eighth grader eventually graduating from a four-year college are less than 6%.
by Alan Briskin | Conscious Capitalism, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Five:
A Shining City on a Hill
Problems No More, USA, 1952-1956
In a dozen short years removed from FDR’s last State of the Union address, the economic landscape had changed dramatically, or so it seemed. The brilliant Robert L. Heilbroner, economist and economic historian, could write that what distinguished the capitalism of the United States from all others was its refutation of Marx’s assumption that government could not be an impartial arbiter. American democracy, he proclaimed, tolerated and allowed for an open discussion of class struggle without class warfare.
Heilbroner believed government could, and did, play a significant role in reconciling divergent interests — and this, Marx, the flawed observer, did not see. How could Marx, Heilbroner suggested, surrounded as he was by the Dickensian factories of England, Russia’s brutal condemnation of trade unions under the czar, monopolies officially championed in Germany, and the ineffectiveness of Italy and Greece to collect their own levied taxes on their respective business communities? The huge chasm between the rich and poor in Europe obscured any vision of reconciliation.
But not in America. Here was the shining city on a hill, to use Ronald Reagan’s attribution of America’s exceptionalism decades later. Here was a country that was neither frozen by a historical aristocracy nor closed to social mobility.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
The expansion of the economy after the war seemed closer to Adam Smith’s Wealth of Nations than to some sourpuss guy named Marx, who at times couldn’t even leave his home because his coat and shoes were sitting in a pawnshop. Even a progressive intellectual like Mary McCarthy could write:
The mansions are torn down and the real estate “development” takes their place…. Class barriers disappear or become porous; the factory worker is an economic aristocrat in comparison with the middle class clerk … vast inequalities and dramatic contrasts are ceasing to exist.
~ Quoted in The Illusion of Unity in Cold War Culture by Alan Brinkley.
From out of inner-city tenements sprang planned communities, like Levittown in New York, and more generally the birth of the suburbs. Mass production strengthened its hold on construction, agriculture, livestock, and our general view of using natural resources. How we build our homes, grow our food, house our animals, and slaughter them all came increasingly under management with an eye to efficiency and surplus value. Under what was labeled free enterprise, incomes grew among the middle class, products expanded, and television emerged to entertain and enchant. What’s not to like? And in contrast, a dozen years of Joseph Stalin (1941–1953) solidified views not only of the error of communism as an economic model but also of the danger of collectivist strategies that masked a top-down concentration of political power.
In the United States, a new society seemed possible, suggesting a greater unity of interests and values traversing classes and regions. What was required was a good work ethic, a little imagination, and a can’t-say-quit attitude. Running for president in 1952 and 1956, General Dwight D. Eisenhower captured this zeitgeist while simultaneously repudiating Franklin Roosevelt’s call for an activist government. Eisenhower beat Adlai Stevenson, who had served under Roosevelt and attacked Eisenhower’s championing of the business community, twice — by large margins. Was it possible that capitalism had matured to the point where it was beyond booms and busts?
Next Week: The Organization Man Meets Radical Self-Interest, 1956 – 1960
Alisa took another path. She became a Hollywood screenwriter and wrote novels. She demanded reverence for her ideas, and her wild mood swings may have been influenced by the amphetamines that she took. She called herself Ayn Rand and in 1957 published her magnum opus, Atlas Shrugged.
by Alan Briskin | Business, Conscious Capitalism, Health, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Four, Part Two:
Out of Depression and War, a New Vision of Wealth Distribution
Time Range: 1929-1944, 2012
The economic bill of rights highlighted
a scar in the American psyche. Roosevelt’s time in office, which included a
failed coup d’état directed against him, deepened the resolve of factions
opposed to government intervention. From
this moment on, a widening split would cleave those who believed in federal
intervention from those who perceived arrogance in a government that addressed
questions of economic distribution.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
FLASH POINT
The Obama Economy–and Ours
Government didn’t build
that.
By Patrick J. Buchanan, July 24, 2012
“If you’ve
got a business, you didn’t build that. Somebody else made that happen.” Mitt
Romney fell on this Obama quote like an NFL lineman on an end zone fumble
during the Super Bowl. And understandably so.
For this
was no gaffe, said Romney, this is what Obama believes. This is straight out of
the catechism. Obama thinks that had not the government created the
preconditions, none of us could succeed. We all depend on government. None of
us can make it on our own.
Had Obama
been channeling Isaac Newton–”If I have seen further than others it is because
I am standing on the shoulders of giants”–or John Donne — “No man is an island,
entire of itself”–many would have nodded in agreement.
But what
Obama seemed to be saying–indeed, was saying–was that, without government, no
business can succeed.
Realizing
that statement rubs against a deeply ingrained American belief–that the people
built the nation–Obama and his acolytes are charging that Romney ripped his
words out of context.
Here is Obama’s full quote:
“If you were successful, somebody along the line
gave you some help. There was a great teacher somewhere in your life. Somebody
helped to create this unbelievable American system that we have that allowed
you to thrive. Somebody invested in roads and bridges. If you’ve got a
business, you didn’t build that. Somebody else made it happen.”
Conservatives, as opposed to liberals, proclaimed that people had a right to own what they owned and government should be on a very short leash. Government intervention should be held to the strictest criteria for determining what benefited the nation as a whole, especially in regard to infringing on private property and wealth accumulation.
The danger of deviating even a little from this principle, they warned, would unleash a swarm of another form of special interest groups, mostly those not very good at earning a living. This meant limiting what government should do and how much taxes it should collect.
If Roosevelt argued the moral and
political basis for ensuring freedom from want, conservatives argued the moral
and political basis for ensuring freedom of individual rights and protecting
those who succeeded on their own without government assistance. If one side
argued against the special interests of business and corporate influences, the
other side argued against the special interests of labor and minorities.
The interdependence of the whole was
visible to some and invisible to others. Both felt the success of the nation
was at stake. Both sides felt varying
degrees of contempt for the other, to the point where even the same words would
appear to have entirely different meanings.
FLASH POINT
US Supreme Court: Closing Arguments Regarding Health Care Mandates
New York Times, March 30, 2012
“Solicitor General Donald B. Verrilli Jr. concluded his defense of the law
at the court this week with remarks aimed squarely at Justice Kennedy. Mr.
Verrilli said there was ‘a profound connection’ between health care and
liberty.
“‘There will be millions of people
with chronic conditions like diabetes and heart disease,’ he said, ‘and as a
result of the health care that they will get, they will be unshackled from the
disabilities that those diseases put on them and have the opportunity to enjoy
the blessings of liberty.’
“Paul D. Clement, representing 26
states challenging the law, had a comeback. ‘I would respectfully suggest,’ he
said, ‘that it’s a very funny conception of liberty that forces somebody to purchase
an insurance policy whether they want it or not.’”
To complicate matters further, discussion of the
proper role of government also pinched a nerve in the neck of the county’s
individualistic orientation. Going back to Henry David Thoreau, the view of
government was that it was the least capable of social institutions to do
anything right. Government was no more than a body of collective incompetents
compromised further by having to compromise with each other. Thoreau, a
naturalist, was not very fond of what he observed of human behavior,
particularly in regard to group behavior on the political stage.
So the mold was cast:
individualism, the right of private property, and state’s rights against those
who believed in groups, collective interdependence, and federal government
intervention. Hopefully the problems would just go away, because the lines were
drawn in such a fashion that no resolution was possible.
FLASH POINT
Health Care Reform and the Supreme Court
New York Times, June 29, 2012
The Supreme Court largely upheld President Obama’s health care law, the Affordable Care Act, in a mixed decision. The conservative chief justice, John G. Roberts, joined the
majority in affirming the central legislative accomplishment of Mr. Obama’s
term.
Chief Justice Roberts ruled that the key provision in
question, the so-called individual mandate requiring all Americans to buy
insurance or pay a fine, failed to pass constitutional muster under the
Commerce Clause, which was the heart of the administration’s arguments in favor
of it. But the chief justice declared that the fine amounted to a tax that the
government had the power to impose, and that the mandate could survive on that
basis.
The decision did
significantly restrict one major portion of the law: the expansion of Medicaid,
the government health-insurance program for low-income and sick people. The
ruling gives states some flexibility not to expand their Medicaid programs,
without paying the same financial penalties that the law called for.
The
debate over health care remains far from over, with Republicans vowing to carry
on their fight against the law, which they see as an unaffordable infringement
on the rights of individuals. The presumptive Republican presidential nominee,
Mitt Romney, has promised to undo it if elected.
Next Week: A shining City on a Hill, 1952-2956
In a dozen short years removed from FDR’s last State of the Union address,
the economic landscape had changed dramatically, or so it seemed. The brilliant
Robert L. Heilbroner, economist and
economic historian, could write that what distinguished the capitalism of the United
States from all others was its refutation of Marx’s assumption that government
could not be an impartial arbiter. American democracy, he proclaimed, tolerated and allowed
for an open discussion of class struggle without class warfare.
by Alan Briskin | Collective Folly, Conscious Capitalism, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter Two:
The Calculus of Capitalism
1847 – 1880
What Marx provided was a theoretical blueprint for cracks that lay in the foundation of a new economic edifice called capitalism. And he did it in the way many intuitive but slightly skewed geniuses operate: by masking it in endless obsessive formulations that make one cry uncle and then demanding that no one deviate from its precepts. Clever. But his insights deserve a closer look if we think of them not solely as literal but also as allegorical intuitions about society, the collective.
Marx had an uncanny grasp of how systems evolve and become unstable. His insights are of particular importance today, when even some of our most successful capitalists are questioning capitalism’s further development and many feel the need to insert the word “conscious” as an adjective to describe the kind of capitalism that is sought. In this light, Marx can be seen as a forerunner of Freud, bringing illumination to unconscious capitalism. And to achieve his purpose, he used not personal dreams but the concept of surplus value, a hypothetical construct from which countless threads of connections were made.
Like dreams, surplus value was something obvious. Every business needed profit to survive. But like dreams, what at first seemed inconsequential or even innocent proved to have hidden meaning. Behind the obvious lay a labyrinthine set of relationships with very real consequences.
HDR photography involves multiple shots at different exposures combined into one image so the viewer can see more of what’s there.
FLASH POINT
New York City, 1890
“The truth is that pauperism grows in the tenements as naturally as weeds in a garden lot. A moral distemper, like crime, it finds there its most fertile soil. All the surroundings of tenement-house life favors its growth, and where once it has taken root, it is harder to dislodge than the most virulent physical disease.”
~ From How the Other Half Lives, written by Jacob Riis
Marx’s discussion of surplus value and the commentary from others that followed remind me of Talmudic debates about how far a person should be permitted to walk without wearing a skullcap on his head — i.e., endless debate with circular arguments that leave one pondering what, if anything, is being said. One can easily become overwhelmed by the debate and even wonder whether God could be so petty. But behind the debate regarding surplus value lay an insight about an invisible force competitive with any theology: the force of money, power, and influence.
Surplus value was the theorized amount that a worker labored beyond what was needed for his or her minimal subsistence. Each additional hour was a surplus that accrued to someone, the worker or the owner of the labor. At the time of Marx’s writing, factory workers spent on average 80 hours a week working, and much of it was surplus value. The question, of course, was who would benefit from the surplus increment.
Marx’s answer was the owner of the factory, the person who owned the means of production, a relatively small class of people who Marx wrote “created more massive and more colossal productive forces than have all preceding generations together. Subjection of Nature’s forces, machinery … clearing of whole continents for cultivation … what earlier century had even a presentiment that such productive forces slumbered in the lap of social labor?”
Most critically, the calculus of surplus labor provided the ability to project profit after all costs of producing the product or service were removed. And this allowed one to attract investment capital, which created further growth, a never-ending cycle of wealth accumulation.
Consider Facebook today as an example of a company that attracted billions of dollars of investment before selling even one dollar of advertising. Its projection of profit was the attractor. Or Apple, whose Chinese factories and low costs of manufacturing ensured profitability from its ever-expanding network of products. The ability to favorably leverage surplus value fuels confidence among investors that greater and greater wealth is possible. How cool is that?
But Marx saw it all in a dispassionate glare, not the dream of social good fueled by producing ever more products and services but a fierce, never-ending conflict swinging tragically among groups vying for domination. There were flies in the wealth-accumulation ointment.
Marx foresaw competitors and counterforces lurking everywhere. Other capitalists would try to horn in on your product. Workers would demand higher wages. Governmental forces might interfere with your enterprise and would need to be neutralized. A ceaseless battle would ensue among those struggling to achieve wealth and others trying to hold them back. New classes of wealth producers would eventually replace older ones, such as in the case of the commercial classes of 17th-century Europe edging out the privileged bloodlines of the aristocracy or early-19th-century English capitalists overcoming the landed gentry. Wherever one turned, struggle and exploitation would be the rule.
In this new institution of commerce, labor-saving machinery would play a pivotal role as a means to reduce labor costs, but technological innovations would ultimately prove unsuccessful as the source of profit. In Marx’s hypothetical world, the costs of creating and purchasing labor-saving technology would cancel out its ability to generate surplus value even as each competing capitalist would be forced to incorporate the technology into his enterprise or be at a disadvantage.
Labor-saving machinery would result in greater unemployment, initially moderating worker demand for higher wages but influencing a drop of consumption as fewer people could afford new things. The downward spiral would lead to an ever more desperate attempt to find new markets and compete effectively with other capitalists. Larger enterprises would swallow up smaller ones, and, as in a game of musical chairs, consolidation would lead to fewer job opportunities, lessening or even lowering the demand for wages. Finally, surplus value would reappear and the cycle would continue.
Workers would again seek self-interest through higher wages, new kinds of labor-saving technology would be conceived, larger enterprises would swallow up smaller ones, profits would swell until limits were reached, often due to corruption, and economic collapse would follow. In Marx’s dark vision, the consistent element was that only human labor could provide surplus value, but with ruinous consequences. This is why Marx, never shy of the provocative metaphor, compared the capitalist class to the undead, because “vampire-like, [it] only lives by sucking living labor.”
Beyond the hypothetical cycles of boom and bust, Marx somehow also intuited a fundamental psychological conflict between the structure for making goods and the superstructure that owned and profited from the enterprise. The first required high levels of integration, cooperation, and concerns for interdependence. Multiple processes had to be aligned to produce the final product. A certain measure of fairness and motivation needed to be stimulated among those working together. What every organizational consultant today knows is necessary for successful enterprise was somehow foreseen by Marx, working out his obsessive formulas in isolation.
But Marx saw something else, a psychological quality that most of us do not want to see. It was this: The majority of owners would exhibit mirror-opposite tendencies. They would be highly individualistic, idiosyncratic, seeking autonomy more than anything else, wary of anyone with too intrusive a social conscience. They would be, for the large part, disdainful of the collective, particularly those elements of society that were not successful. Words like personal responsibility and accountability would take on almost a sacred tone when addressed to subordinates. What would primarily concern the ownership class was their privilege, solidifying their capital accumulation, passing it on to their children, and expanding their freedom to do exactly as they desired. Forces on behalf of social planning, with its requirement for a modicum of social cooperation, would thrust themselves against the psychology of individual privilege, and they would grind away at each other like tectonic plates just below the surface.
Main Sources
The Worldly Philosophers, by Robert L. Heilbroner
The Communist Manifesto, by Karl Marx and Friedrich Engels
Grand Pursuit, by Sylvia Nasar
Next Week: Ghosts of Past, Present, and Yet to Come
Would not progress and economic growth lift all ships? Rather than economic cycles leading to greater economic division and social fragmentation, would there not transpire higher levels of educational attainment, greater entrepreneurial opportunities, and increased social mobility? In time, isn’t it logical to think that an investment class would value knowledge and motivation for its workers, leading to better working conditions, not worse? How could it be otherwise? With time, progress would surely come…
by Alan Briskin | Collective Folly, Conscious Capitalism, Humor, Politics
A serial journal of cogent reflections and irreverent insights on the social effects of capitalism and the roots of partisan politics. Pairing prose with HDR photography and “flash points” drawn from current and historical perspectives, the author seeks to recover lost wisdom and courageous action beyond the shouting and noise of today’s headlines.
Chapter One:
Eight-Leaved Clovers of the World, Unite
London, 1847
On a bleak November day, two men trudged along Great Windmill Street in London. They breathed in air yellow from industrial waste and pondered the extremes of wealth and poverty that had sprung up like gods and demons across the city landscape. Between their poor vision and the London fog, they could barely see a foot ahead of themselves, but in their minds’ eye, they saw a future of increasing economic division. Somewhere not too distant in time, they believed, anger would well up among the workers, culminating in revolutionary action.
One of them wanted to show the world with a simple parable, like an ancient prophet, why society’s self-destruction was inevitable. The other, the son of a Jewish family that adopted Christianity, was born into affluence and respectability, but called to forsake his relations, though not so much that he wasn’t willing to borrow money from them. So it was that these two compatriots, Friedrich Engels and Karl Marx, made their way to the Red Lion Pub.
HDR (High Dynamic Range) Photography by Alan Briskin: multiple shots at different exposures are combined into one image in order to show “more of what’s there”.
FLASH POINT
New York City, 1890
“These are the economic conditions that enable my manufacturing friend to boast that New York can “beat the world” on cheap clothing. In support of his claim he told me that a single Bowery firm last year sold fifteen thousand suits at $1.95 that averaged in cost $1.12 ½.”
~ From How the Other Half Lives, written by Jacob Riis
It was as if the two of them were destined to emerge victorious among a ragtag group of immigrants, intellectuals, utopians, anarchists, and protesters who had come together to chart a new social contract. Marx, full of himself, was never more alive than in a good intellectual battle, and Engels had the cheerfulness, adaptability, and good nature of a born organizer. “This time we will have our way,” he wrote to Marx before they arrived in London. And have their way, they did. The German Workers’ Educational Union, a convenient public relations front for the Communist League, voted to adopt their draft of the Communist Manifesto, which Marx had read portions of out loud to the group. However, what the group heard was in some doubt, given Marx’s accent and lisp. One witness recalled that when Marx said “workers,” some thought he said “eight-leaved clovers,” which must have been somewhat confusing.
Marx and Engels were early practitioners of a particularly speculative and ambiguous field of social science initially described as “political economy” and later shortened to “economics,” denoting a more neutral and quantitative perspective regarding society’s production and distribution of goods and services. Originally derived from an ancient Greek word, the root meaning of economics had to do with the management or administration of a household. But the household was now nations and transnational corporations.
Marx and Engels were visionaries, foreseeing a new economic institution that was still emerging, one that would harness the energies of human imagination in no less dramatic a fashion than Prometheus’s giving fire to humanity. Engels, in particular, was awed by what was occurring around them. He was not alone marveling at the extraordinary gifts of commerce, high culture, diversity, social mobility, new services, and hope that this new economic institution engendered. Capitalism was a dream for many of an ever-lasting prosperity. Marx and Engels sought to waken them to its true consequences.
In mid-19th-century London, the physical location where Marx and Engels delivered the Manifesto, their parable on social disintegration, there was no greater center of commerce in the world. It was a marketplace without comparison, a hive of activity where “at a low cost and with the least trouble, conveniences, comforts, and amenities beyond the compass of the richest and most powerful monarchs” could be found. Incomes were, on average, 40% higher there than in other English cities, and the results were palpable, with a level of escalating consumer demand driving entrepreneurial forces toward novelty, innovation, new technologies, and entire new industries.
These new economic arrangements were a thunderbolt challenging hundreds if not thousands of years of human history. Commerce of this proportion was a social retort to common beliefs about the inescapability of material deprivation for the masses. Capitalism was to be a buffering institution between the transcendent and random forces of God and nature on the one hand and control over one’s own personal destiny on the other. Trade of this form and intensity was a force for progress, freedom, and increasing liberty. What could go wrong?
The question hovers over us today as it did for Marx and Engels. They were witnesses to an emerging economic institution that still had no agreed-upon name. In the Communist Manifesto, they were more prone to talk about a bourgeoisie class than a capitalist class, but over the next 20 years, Marx would settle on words and terms like capitalist and capitalist mode of production, using them thousands of times in his economic discourses. But just as “eight-leaved clovers” had been mistaken for “workers,” audiences would hear different things, make wildly different judgments about their meaning and effects, and in the end polarize the choices between capitalism and communism, missing the collective context and dreams that had brought these words to consciousness in the first place.
Main Sources
The Worldly Philosophers, by Robert L. Heilbroner
The Communist Manifesto, by Karl Marx and Friedrich Engels
Grand Pursuit, by Sylvia Nasar
Next Week: The Calculus of Capitalism
What Marx provided was a theoretical blueprint for cracks that lay in the foundation of a new economic edifice called capitalism. And he did it in the way many intuitive but slightly skewed geniuses operate: by masking it in endless obsessive formulations that make one cry uncle and then demanding that no one deviate from its precepts. Clever…
FLASH POINT
