Saturday, January 19, 2019

406. Why capitalism is unbeatable

In spite of a number of crises, capitalism is still thriving. How come? Does it satisfy more than material needs?

The human being is confronted with a range of antagonisms: the sacred/eternal and the profane/temporal, heaven and earth, body/matter and soul/spirit, desire and contentment, the universal and the particular, self/individual and other/collective, unity and variety, true and false. How can one deal with these? One needs a combination of fooling oneself, in ‘cognitive dissonance’, denial of the tension, and having an eye only for one side of an antagonism, with ideology that enshrines one’s preferred option. Capitalism does both superbly.

It opts unequivocally for the self and denigrates the social, communal and local. It even proves (mathematically!) that greed is good, produces the highest possible level of prosperity. What is more alluring than that? It appeals to natural urges towards greed and self-manifestation, in both production and consumption. Opposition from altruism is blocked because that cannot survive in markets.

Its individualism is sanctioned by the Christian belief in individual, immortal souls. The magic of markets is that they offer variety, but under unity of universal market principles.

It appeals to the unquestionable, universal truth of markets, in a mystique of the automatic force of the ‘invisible hand’ of Adam Smith. ‘Laissez faire’: the magic will work itself. No counterforce can rival it. And no developing country must close itself off from international markets (while developed countries did that in their infancy).

In going for the individual it obstructs collective forces that may curtail it, such as unions, consumer societies, and ecological societies. It does constitute an interest group in itself. It lobbies for advantage, but not overtly, in secrecy, and denied when publicized. It is in the guilty interest of government to contribute to its secrecy, enhanced by revolving door careers between business and government. 

In the stimulus of unending consumption, with new desires, it helps keep the boredom at bay that follows the satisfaction of desire. Shopping then becomes a way of life. The opposite of Buddhism, one could say. 

It appeals to two forms of Romanticism. One, going back to Rousseau, is that of the free, autonomous individual against the coercion, manipulation and distortion of society. ‘There is no such thing as society’, was the motto of Margaret Thatcher. Breaking out of plodding mediocrity.

The second form of Romanticism is that of the transgression of boundaries: of the discoverer, the imperialist, the heroic entrepreneur, and the heroic scientist, breaking old constraints and opening new avenues to untold power, insight, pleasure and convenience. According to Harari[i] it is the combination of capitalism, the scientific spirit and credit (to finance expansion and growth) that has produced European prominence in the world. And now Europe is being taken over by others imitating that perspective, first in the West (the US) and then in the East (China). They now practice capitalism in a purer or more complete form than Europe. Europe began to have qualms about capitalism, in communism, socialism and humanism, and now has lost its position of power.   

It is Nietzschean, in its creative destruction, breaking up the old, not letting oneself be held back in power by the mediocre, with their jealousy, grudges and slave mentality. However, in large part this is myth. Large capital focuses on incremental innovation that leaves sunk investments intact for as long as possible, prolonging their life to save capital and squeeze it for profits. The most radical innovations are conducted by smaller firms, which then get bought by the large ones, to be frozen for as long as possible.

Ethical objections, and pleas for justice and benevolence, are waved off with the liberal claim that morality is a private matter, for behind the front door. The ruling ethic is that only outcomes count, in terms of utility, measured as prosperity. It considers instrumental, extrinsic quality of tools, capital and actions, not the intrinsic quality of processes (work), conditions and intentions. Justice beyond prosperity is not on the agenda. Of the classical virtues of reason/prudence, courage, moderation and justice, capitalism satisfies reason, in pursuing science, and courage, in crossing boundaries, but it violates the virtues of moderation and justice.

It pursues the truth of pragmatism: truth is what works. No nonsense, not the airy idealism and speculation of stuffy, ivory tower idealists.

Finally, while once upon a time the expectation was that capital would be overwhelmed by the power of labour, now with globalization the power of capitalism has only increased, and subdues labour, with the threat of capital to move its employment elsewhere if it does not get its way, in tax evasion, low cost, and low security and intrinsic quality of labour, subsidies for energy, and lenient environmental restrictions.

[i] Yuval Noah Harari, 2011, Sapiens; A brief history of humankind, Penguin.

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