Mr BoShambles
jambiguous
This is my first contribution to dissensus but I have been following the debates on some recently posted threads and it seems that capitalism and economic globalisation cop some quite astounding criticism. I am interested to hear what, exactly, do y'all (amongst the anti-globalist/capitalist crew) envisage to be alternative and superior systems for the majority of mankind? Put another way, if globalised capitalism could be overthrown tomorrow what economic system would you advocate in its place?
Here's my thinking (apologies if its a bit long-winded...)
Pre-capitalist agrarian societies were, when measured in terms of sconomic growth, virtually stagnant. Agricultural productivity was intrinsically linked to population size; increases in productivity led to resultant increases in population but this was regulated by regular famines, epidemics and wars. Furthermore feudal relations (by which I mean rigidly hierarchical social structures with status largely ascribed at birth) were oppressive and the rural masses toiled in the fields for mere subsistence. Life expectancy rates were low, infant mortality high, and formal education and political representation were meaningless. Slavery, bonded labour and ritual sacrifice for ceremonial purposes were common in pre-capitalist societies all over the globe. The hegemonic values of capitalist societies - 'growth' and 'progress' - were clearly not central to the value systems of pre-capitalist societies and spiritual worship was the predominant? way that people rationalised their existence. But the fact remains that in societies like these, the masses had little to aspire to; there was little hope of significantly improving ones lot or even that of ones children. Can we agree therefore that there is/was little romantic or utopian here?
By the turn of the Nineteenth Century, feudal relations in much of Europe had been replaced by a system of wage labour whereby individuals of all strata of society were free to sell their labour to the highest bidder. Social mobility was now greatly increased and the masses, although still poor, were no longer serfs and could therefore aspire to higher status. Furthermore the Enlightenment ideals of social progress and economic growth had provided incentive for innovation and invention. Change (away from the stagnant feudal system) was seen as necessary for the advancement of mankind and this was to be achieved, in economic terms, through making the production and distribution of goods more efficient.
This is the basis for capitalism. Each individual is free to realize his/her own economic potential. So we sell our labour to the highest bidder. If we want to earn more we learn new skills (through education and/or practical experience) which makes us more desirable and increases our labour value. We can live frugally and save some of our wages until we can invest in capital assets (land, buildings, tools, machines) which increase our ability to generate wealth. This is a socio-economic ladder that can be climbed by everyone living in a capitalist society.
Economic competition between individuals drives efficiency. If someone else can produce the same good for less, or a better quality good for roughly the same price as we can; well then why would anybody buy our goods? As efficiency increases less people are required to produce the same quantity of a specific good and this therefore frees up labour and consequentially deepens and diversifies the capitalist division of labour. How else would all the technological advancements that we have today been practically possible? While ever the division of labour was master-serf (feudal/pre-capitalist) what opportunities and incentives existed to innovate and improve?
Capitalism is both a producer and a product of social change. Enlightenment thinking, agricultural reform and subsequent population growth and rural-urban migration created the conditions for its emergence. Since then, as 'free' individuals, people in the capitalist 'West' have evolved a distinct notion of 'rights’. Demand, amongst the masses, for these rights to be realized has led to many of the ills present both in pre-capitalist and early-industrial society to be addressed. For instance child labour and slavery are no longer permitted (legally at least); women have achieved emancipation and all adults now have the right to vote in democratic elections; working pay and conditions have been subject to legislation which has vastly improved the security of the worker; and healthcare, sanitation and education have become social norms expected by everyone. These achievements should be celebrated. Yet, rather ironically, many of the most vocal critics of capitalism are themselves products of that very system. Put another way, many anti-capitalists come from liberal capitalist societies; they enjoy the material benefits, economic opportunities and social freedoms that this offers to them; and yet simultaneously they protest against the system that allowed it all to be created.
Inequality is often the main complaint levelled against capitalism (as if in pre-capitalist societies everything was fair and equal??? I think not!) But actually inequality is partly why the capitalist system works so well. Incentive for efficiency and progress is everything. Capitalist society is predicated on political equality not egalitarianism as Peter Schwarz explains:
‘Egalitarianism is the antithesis of the valid tenet of political equality, under which we have equal rights. That is, we have the right to achieve whatever our ambition and talents allow, with no one permitted to forcibly stop us. Egalitarianism, however, is a denial of the individual's right to be left free. It is an abhorrent demand that some people be punished for achieving what others haven't. It is a brazen declaration that an equality of condition must be attained'
Attempts to create such 'equality of condition' as in Communism/Socialism have resulted in authoritarian states capable of inflicting war, enslavement, economic suffering and death on a terrifying scale. Attempts to forcibly redistribute private wealth have served to remove the individual incentives (found in capitalism) to strive for efficient production and innovation. States that have banned or severely limited private economic activity and instead assumed responsibility for organising the production and distribution of goods, have invariably created bloated bureaucracies plagued by rampant corruption. Furthermore, lack of economic, political and social freedoms have led to growing levels of dissatisfaction amongst the population which in turn has led to increasingly harsh forms of repression employed by the state apparatus to retain control. In reality is there anything romantic here?
So what do you critics of globalised capitalism recommend? I am not for a minute suggesting that there are not problems (like crime, social exclusion etc) within capitalist societies. But these are not economic problems but rather socio-political in nature. Capitalism as an economic model has generated a huge improvement in the material standards of living for people across the globe. Absolute standards of living have greatly improved in all but the most unfortunate places (where war, political instability, HIV and other epidemics, poor political decisions, lack of a socially recognised and non-discriminatorily enforced legal system etc are the main culprits). For anyone who doubts the capacity of capitalism to rapidly improve the daily realities of 'poor' people in the developing world, just read the seminal work of Hernando de Soto (Peruvian economist) entitled 'The Mystery of Capital'.
There is nothing wrong in aspiring to improve the way society functions. There is though, in my humble opinion, everything wrong in aspiring to overthrow the capitalist system, the source of our prosperity, in the vague and romantic hope of ushering in a truly equal utopia that is waiting just around the corner.
Here's my thinking (apologies if its a bit long-winded...)
Pre-capitalist agrarian societies were, when measured in terms of sconomic growth, virtually stagnant. Agricultural productivity was intrinsically linked to population size; increases in productivity led to resultant increases in population but this was regulated by regular famines, epidemics and wars. Furthermore feudal relations (by which I mean rigidly hierarchical social structures with status largely ascribed at birth) were oppressive and the rural masses toiled in the fields for mere subsistence. Life expectancy rates were low, infant mortality high, and formal education and political representation were meaningless. Slavery, bonded labour and ritual sacrifice for ceremonial purposes were common in pre-capitalist societies all over the globe. The hegemonic values of capitalist societies - 'growth' and 'progress' - were clearly not central to the value systems of pre-capitalist societies and spiritual worship was the predominant? way that people rationalised their existence. But the fact remains that in societies like these, the masses had little to aspire to; there was little hope of significantly improving ones lot or even that of ones children. Can we agree therefore that there is/was little romantic or utopian here?
By the turn of the Nineteenth Century, feudal relations in much of Europe had been replaced by a system of wage labour whereby individuals of all strata of society were free to sell their labour to the highest bidder. Social mobility was now greatly increased and the masses, although still poor, were no longer serfs and could therefore aspire to higher status. Furthermore the Enlightenment ideals of social progress and economic growth had provided incentive for innovation and invention. Change (away from the stagnant feudal system) was seen as necessary for the advancement of mankind and this was to be achieved, in economic terms, through making the production and distribution of goods more efficient.
This is the basis for capitalism. Each individual is free to realize his/her own economic potential. So we sell our labour to the highest bidder. If we want to earn more we learn new skills (through education and/or practical experience) which makes us more desirable and increases our labour value. We can live frugally and save some of our wages until we can invest in capital assets (land, buildings, tools, machines) which increase our ability to generate wealth. This is a socio-economic ladder that can be climbed by everyone living in a capitalist society.
Economic competition between individuals drives efficiency. If someone else can produce the same good for less, or a better quality good for roughly the same price as we can; well then why would anybody buy our goods? As efficiency increases less people are required to produce the same quantity of a specific good and this therefore frees up labour and consequentially deepens and diversifies the capitalist division of labour. How else would all the technological advancements that we have today been practically possible? While ever the division of labour was master-serf (feudal/pre-capitalist) what opportunities and incentives existed to innovate and improve?
Capitalism is both a producer and a product of social change. Enlightenment thinking, agricultural reform and subsequent population growth and rural-urban migration created the conditions for its emergence. Since then, as 'free' individuals, people in the capitalist 'West' have evolved a distinct notion of 'rights’. Demand, amongst the masses, for these rights to be realized has led to many of the ills present both in pre-capitalist and early-industrial society to be addressed. For instance child labour and slavery are no longer permitted (legally at least); women have achieved emancipation and all adults now have the right to vote in democratic elections; working pay and conditions have been subject to legislation which has vastly improved the security of the worker; and healthcare, sanitation and education have become social norms expected by everyone. These achievements should be celebrated. Yet, rather ironically, many of the most vocal critics of capitalism are themselves products of that very system. Put another way, many anti-capitalists come from liberal capitalist societies; they enjoy the material benefits, economic opportunities and social freedoms that this offers to them; and yet simultaneously they protest against the system that allowed it all to be created.
Inequality is often the main complaint levelled against capitalism (as if in pre-capitalist societies everything was fair and equal??? I think not!) But actually inequality is partly why the capitalist system works so well. Incentive for efficiency and progress is everything. Capitalist society is predicated on political equality not egalitarianism as Peter Schwarz explains:
‘Egalitarianism is the antithesis of the valid tenet of political equality, under which we have equal rights. That is, we have the right to achieve whatever our ambition and talents allow, with no one permitted to forcibly stop us. Egalitarianism, however, is a denial of the individual's right to be left free. It is an abhorrent demand that some people be punished for achieving what others haven't. It is a brazen declaration that an equality of condition must be attained'
Attempts to create such 'equality of condition' as in Communism/Socialism have resulted in authoritarian states capable of inflicting war, enslavement, economic suffering and death on a terrifying scale. Attempts to forcibly redistribute private wealth have served to remove the individual incentives (found in capitalism) to strive for efficient production and innovation. States that have banned or severely limited private economic activity and instead assumed responsibility for organising the production and distribution of goods, have invariably created bloated bureaucracies plagued by rampant corruption. Furthermore, lack of economic, political and social freedoms have led to growing levels of dissatisfaction amongst the population which in turn has led to increasingly harsh forms of repression employed by the state apparatus to retain control. In reality is there anything romantic here?
So what do you critics of globalised capitalism recommend? I am not for a minute suggesting that there are not problems (like crime, social exclusion etc) within capitalist societies. But these are not economic problems but rather socio-political in nature. Capitalism as an economic model has generated a huge improvement in the material standards of living for people across the globe. Absolute standards of living have greatly improved in all but the most unfortunate places (where war, political instability, HIV and other epidemics, poor political decisions, lack of a socially recognised and non-discriminatorily enforced legal system etc are the main culprits). For anyone who doubts the capacity of capitalism to rapidly improve the daily realities of 'poor' people in the developing world, just read the seminal work of Hernando de Soto (Peruvian economist) entitled 'The Mystery of Capital'.
There is nothing wrong in aspiring to improve the way society functions. There is though, in my humble opinion, everything wrong in aspiring to overthrow the capitalist system, the source of our prosperity, in the vague and romantic hope of ushering in a truly equal utopia that is waiting just around the corner.
