Saturday


Was the rise of the middle class

Proletarians walter crane

a temporary aberration of industrial capitalism?


In several posts I have argued that the view that Marx may be dismissed because the end of the Cold War “proved” that capitalism has defeated communism (a thesis that might also be identified with Fukuyama’s “end of history” thesis) is mistaken. I am not a Marxist sentimentalist, who, like many on the left today, needs to believe in Marx, including that which has been shown to be manifestly false or inadequate, but the point I want to make has nothing to do with a sentimental connection to Marxist thought. To twist the world around so that it either agrees perfectly with Marx or utterly overthrows Marx is to completely miss the point. What is the point? The point is to find that which is of perennial value in any first rate thinker.

Here are some of the posts in which I have addressed this question:

Globalization and Marxism

The Continuing Relevance of Marx

The Extinction of the External Proletariat

Marxist Easchatology

My argument in these posts has been that, since the industrial revolution is still unfolding, it is not yet the case, nor has it yet been the case in global history, that the economy of the entire world has been industrialized — a condition that I have called industrialization at totality. Therefore the predictions of Marx that, once industrialization had run its course, consolidations within industry would concentrate wealth at the top and gradually tend to immiserate the proletariat until the proletariat was better off overthrowing the few at the top and taking over industry for themselves, still remain as predictions that could be proved to be true by subsequent historical events.

We are now witnessing the extension of the industrial revolution to those parts of the world that were called the “Third World” during the latter part of the twentieth century. China and India are rapidly industrializing, and it is changing the overall structure of the world economy. It was just reported in the past week that, by 2030, China’s economy will be the largest on the planet (though not by a per capita measure). In the later twenty-first century, Asia will consolidate its industrialization while Africa will be well on its way to industrialization. Sometime in the twenty-second century we may see the entire world consisting of industrialized nation-states in which subsistence farming simply no longer exists.

In this scenario of global industrialization as I have outlined it above, it is likely that the living standards of peoples all over the world will have been greatly improved, and this flies in the face of the Marxist prediction of immiserization. If this is the case, there will be no incentive for worldwide proletarian revolution, and then at that time Marx will have been proved wrong. But the convergence of the world entire upon industrialization is only the beginning of the story.

We are now seeing in the advanced industrialized economies what industrialized capitalism looks like in its senescence, and what it looks like, unfortunately, is macro-parasitism in the form of crony capitalism. Those who are in a position of influence with respect to the privileged elites of industrialized nation-states shamelessly use their influence to obtain favorable circumstances for themselves and their cronies in industry. Thus while the initial stage of global industrialization will likely bring significantly higher living standards to the masses, if this system is allowed to develop globally as it has developed in North America and Western Europe — and I see no reason why it should not do so — what we will see one or two hundred years after the consolidation of global industrialization is a global regime of crony capitalism every bit as egregious as Marx predicted.

This is a development that we should all find worrying. We are in danger of creating a society as backward and as retrograde as feudalism at its worst, only feudalism with the instruments of industrialized technology at its command — something that Winston Churchill might well have called, “the abyss of a new dark age made more sinister, and perhaps more protracted, by the lights of perverted science.”

While part of this development is due to blind forces acting within the economy, part of it is a policy choice that has been knowingly pursued by those in a position of political power. Of course, policy choices can, in turn, be the result of blind political forces, in contradistinction to the blind economic forces that act directly upon the economy, but the result is the same. When political organization careens thoughtlessly from one crisis to the next, never acting but only reacting to the forces to which it is subject, this is an abject dereliction of political responsibility by those placed in a position that gives them the opportunity to do something other than merely react to pressure.

In previous posts such as Celebrating the American Laborer and The Genealogy of Labor I have pointed out how the so-called “middle class” has been fetishized in American political thought, but even as it is fetishized it is being reduced to insignificance by the economic and political forces mentioned above. And because of the ability of large sections of the population to engage in economic self-deception (of the kind I described in Progress, Stagnation, and Retrogression), we might continue to frame ourselves as a “middle class society” for decades even while the middle class is disappearing.

So I, too, risk appearing as just another commentator bemoaning the loss of the middle class in the US, so that what I say is very likely to be drowned in the background noise of economic complaint. But the problem is real, and it is worse than we suppose. It is bad enough that in the advanced industrialized nation-states we could be said to be witnessing the re-proletarianization of the workforce. What is a proletariat? The word “proletariat” comes from the Latin prōlētārius, the lowest class of Roman citizens. The Oxford English Dictionary defines a proletariat as, “Wage earners collectively, esp. those who have no capital and who depend for subsistence on their daily labour” and “The lowest class in society; the poor, the masses.”

I have observed that absolutely no one today wants to be called a proletariat, and because of the economic self-deception that I described in Progress, Stagnation, and Retrogression it is entirely possible to be a proletariat for all intents and purposes while denying that one is such a thing — or even that there is such a thing. This is the opposite of class-consciousness: it is class unconsciousness. So if it is part of orthodox Marxist doctrine that class consciousness will emerge with the growth of the proletariat, then in this I think Marx was dead wrong. But if this sad scenario comes to pass, class unconsciousness will be sufficient, because we know from Freud that the unconscious can manifest itself in inconvenient forms, such as neuroses. We should expect to see, then, social neuroses — the sort of thing one would expect from neurotically miserable civilizations.

The proletariat is an industrial serf — the peasant of the factory system — and a serf or a peasant feels little or no connection to the social order of which we forms the lowest tier. This is a problem. If those whose work makes industrial-technological civilization function come to realize that they have no stake in this civilization, they will do nothing to sustain it, nothing to maintain it, nothing to preserve it if it is in danger. Thus the re-proletarianization of the workforce is potentially a profound source of existential risk — the risk of flawed realization.

It has been argued that a society must get its system of rewards more or less right if it is going to incentivize productive and innovative behaviors, and this is the argument that is used to defend stock options with an up side and no down side, to defend disproportionately large executive pay packages, and in general to defend every method that the privileged employ to milk the system for their own exclusive benefit. That these are spectacularly self-serving arguments made by the shills of the privileged class has not stopped them from being made — repeatedly.

But there are two sides to the incentive system: capital and labor, and labor requires its incentives no less than does capital. Some interesting results in experimental economics in scenarios designed by game theorists give us the precise counter-argument to the incentive system argument as used to defend the absence of upper bounds to elite compensation. One such game involves giving a certain amount of money to player A with the instruction that Player A must share the money with Player B. If player B accepts the proposed allocations of shares, both players get to keep the money; if player B rejects the allocation of shares, neither player gets anything. When such experiments are run, most offers made by player A are for a 50/50 split, and these offers are almost always accepted. When player A offers an allocation that disproportionately advantages player A, like a 90/10 split favoring player A, such allocations are almost always rejected. In other words, player B would usually rather get nothing than see player A get almost everything.

This is an ominous result for contemporary economics in the advanced industrialized nation-states, because the gradual convergence upon a “winner take all” incentive system is pushing the rewards system in the direction of giving the privileged classes almost everything while giving the unprivileged masses very little of what is available over all. Now we know from game theory and experimental economics that players almost always refuse such a deal when it confronts them in an explicit form.

It is no leap from this result to get to the point that the less privileged working classes who make the economies of advanced industrialized nation-states operate, when they fully realize that the deal they are getting is so disproportionately small, that they would prefer nothing at all to allowing the other player in the game to get almost everything. Of course, the masses are slow to realize this, and the elite classes who also operate the mass media are in no hurry to explain this to the masses. But we cannot count on a system of radically disproportionate rewards to last indefinitely.

If real, substantive, systematic, and effective measures are not taken to approach a more equal distribution of the rewards of industrial-technological civilization, Marx will be proved right in the long term. If those who are the primary producers of this wealth do not share in the wealth, they will see no reason to continue to cooperate in the production of wealth in which they do not share.

Of course, a lot can happen in the two to three hundred years it could take for global industrialization to consolidate its position and then to reach the sad state of crony capitalism now seen primarily in only the most mature industrialized nation-states. Unprecedented and unpredictable historical developments of many different forms could hold off global industrialization or direct it into unexpected channels. In such cases, the proof or disproof of Marx may have to wait even longer.

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Friday


In my book Political Economy of Globalization I attempted to formulate my theses in the greatest possible generality (Russell’s influence was at work here, since he often urged formulations of the greatest possible generality), and, to this end, I did not loosely write in terms of states or nations or countries, but chose to write instead in terms “political entities.”

From the glossary appended to the same work, here is the definition that I gave for political entities:

Any actor whatever engaged in political activity. Political entities include, but are not limited to, individual persons (under the aspect of homo politicus, i.e., political man), interest groups, peoples, city-states, nation-states, and republics. The demarcation between political entities and economic entities (q.v.) is in no sense fixed, as many entities are both political and economic actors. An NGO (q.v.) is a political entity, though it is no kind of state, which latter may well be the paradigmatic political entity. And the nation-state (q.v.), in so far as it engages in quasi-economic activity (q.v.), is both a political and an economic actor.

When I opened my book with a discussion of the nation-state, I tried to be clear that while the nation-state is the central political fact of our time, it is only one political entity among others, and just as other political entities were central to the world system prior to the advent of the nation-state, so too other political entities will someday supersede the nation-state. But don’t expect it to happen soon, or in your lifetime. These things move at a glacial pace, and are only apparent in hindsight to the historian; they are hidden from our view by the onrushing events of the present.

Another way to formulate the preeminence of the nation-state in the contemporary global system is to say that it is the indispensable political entity of our time. I thought of this formulation a few days ago when I was writing The Radicalization of Miners in Andean South America. I was re-reading the Pulacayo Theses and came across this formulation early in the very first item:

1. The proletariat, in Bolivia as in other countries, consti­tutes the revolutionary social class par excellence. The mineworkers, the most advanced and the most combative section of this country’s proletariat, determine the direction of the FSTMB’s struggle.

And in the original Spanish:

1.- El proletariado, aún en Bolivia, constituye la clase social revolucionaria por excelencia. Los trabajadores de las minas, el sector más avanzado y combativo del proletariado nacional, define el sentido de lucha de la FSTMB.

Note: this may sound a bit slow on my part (sometimes I can be rather dense), but when I was studying this a few days ago I hadn’t even thought to search for an English language translation, but I found one today at the Permanent Revolution website, and that is the English language version that I have given above. I had rendered this as, “The proletariat, in Bolivia as in other countries, consti­tutes the indispensable revolutionary social class.”

This is boilerplate Marxist doctrine: the proletariat is the revolutionary class, and will be the force that expropriates the expropriators, though it may have to be prodded into action by revolutionary cadres of bourgeois intellectuals converted to the revolutionary cause. While such claims become tiresome when repeated rote by doctrinaire believers, placed in a larger and more general context of political entities it becomes interesting.

In my definition of political entities quoted above I didn’t even think to mention social classes (though I did mention interest groups, which aren’t quite exactly the same thing), though I have an out because I did specify that my list was not exhaustive. A social class like the proletariat must be counted among the political entities that have played a central role in history. Among various political systems, different political entities can serve as the indispensable political entity of that particular system — the conditio sine qua non of a given form of political thought.

Thus it is that, in the world today, the nation-state is the indispensable political entity; for the Marxist, the proletariat — a class — is the indispensable political entity; in the Hellenistic world of antiquity, the city-state was the indispensable political entity, and it is to be noted that Plato’s Republic and Aristotle’s Politics both address the political structure of a city-state. One of the interesting things about feudal systems, whether found in the West or elsewhere in the world, is that no one particular class is indispensable. In feudalism, each class has its role that is indispensable to the social whole; it is the class system itself that is the indispensable political entity — which makes feudalism a kind of meta-Marxism.

There are so many different kinds of entity that could serve as the indispensable political entity for a political system that it is almost surreal and reminds one of Comte de Lautreamont’s wildly disparate grouping of the umbrella and the sewing machine on a dissecting table, or of Latourian Litanies.

What else? What next? What might be (or become) an indispensable political entity? This obviously suggests a negative formulation: what could not serve as an indispensable political entity? I do not think that there is any adequate system of political philosophy yet formulated that can even give us a clue as to how to begin to answer this question. Where do we set limits, and why?

The nation-state is a geographical entity tied to a legal and an economic regime; the proletariat is a social class tied to a revolutionary idea; feudal systems are social structures that apportion classes within a society but are not identical to any one class or class interest; the city-state is an urban entity. Contemporary ideas of urban planning might be said to be converging upon the city as the indispensable political entity, but this is a very different sense of urbanism than the urbanism of ancient city-states. Other examples might be the Caesaropapism of the Byzantine Empire, the Pharaoh in ancient Egypt, or possibly a mythological time of the foundation of a political order, to which all political structures are made to refer. Not only is there nothing essentially in common between these indispensable political entities; there is not even any kind of discernible family resemblance between these diverse objects representing the centralization of political power.

This ought to a lesson to us in terms of thinking that political development has ended or reached a dead end (the “end of history” thesis). I’ve addressed this aspect of the “end of history” thesis from a related angle not long ago in Gödel’s Lesson for Geopolitics, where I argued that Gödel’s own interpretation of incompleteness results points to ongoing intellectual development.

It seems odd to even have to say it, but the incredible, overwhelming inertia of unimaginative political thought forces us to repeat the fact that human political thought is still in its infancy and has yet to even reach a point at which complex and difficult problems can be intelligently and rationally discussed. Almost all political thought to date has consisted of a kind of political theology that engages in special pleading for some kind of pre-determined end. Until we get past this point, we will not yet see the first glimmerings of the maturity of our political thought.

When we have, as a species, at least glimpsed the possibility of mature political thought, we will be able to systematically lay out the limits as to what can and what cannot serve as the indispensable political entity of a political system. We are not yet in a position to do so.

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Some Thoughts for Labor Day

6 September 2010

Monday


Labor Day is one of the major holiday weekends on the US calendar. Memorial Day and Labor Day bookend the summer at its beginning and ending, and are widely celebrated here as families pile into their cars for the long weekend and often go to a lake, a river, the ocean, or a mountain to get away from the infrastructure of industrialized civilization. While Memorial Day remains a time when people are widely aware of the origin and meaning of the holiday, there is very little reflection on the meaning of Labor Day, except for some politicized speeches at picnics sponsored by unions.

The contemporary political left in the US makes much of the violence of US labor history, and its virtual elision from textbooks, if not also public consciousness. In this, they are right. Very few people who do not already have an ideological inclination to study labor history have any idea of the hard-fought and hard-won battles over labor and the rights of labor in US history. It is a fascinating story that I will not attempt to recount or even summarize here.

These hard-fought and hard-won battles, unlike many historical disputes that have dropped out of public consciousness, had real results. While it is by no means easy to be a laborer, the working class (which, as I have observed elsewhere, is almost everyone today) has protections that have been written into law. Social security, medicare, unemployment insurance, worker’s compensation insurance, and a variety of protections, as well as legal mechanisms for workers to seek a redress of grievances against employers, have changed the way the companies do business, and have changed the lives of workers. We are so familiar with these programs that we scarcely think of them any more except as budgetary items, but they represent the legal institutionalization of the labor movement. Certainly worker benefits are much more generous in Europe, but Europe has a very different culture than the US, and the programs that function in Europe probably would not work very well on this side of the Atlantic.

It is deceptive to speak of “workers” because, as I noted above, almost everyone today is a worker. A year and a half ago in Responses to Recession, Left and Right I quoted otherwise notoriously muddle-headed metaphysical philosopher Alfred North Whitehead on this, who seemed to understand with preternatural clarity the condition of man in industrialized society:

“In any large city, almost everyone is an employee, employing his working hours in exact ways predetermined by others. Even his manners may be prescribed. So far as sheer individual freedom is concerned, there was more diffused freedom in the City of London in the year 1633, when Charles the First was King, than there is to-day in any industrial city of the world.”

Alfred North Whitehead, “The Study of the Past – its Uses and its Dangers,” Harvard Business Review (Volume XI, number 4, 1933)

To this I added the following:

Quite true. Even the heads of multinational corporations, CEOs, CFOs, CIOs, and all the other chiefs and captains of industry are in fact employees of a corporation who are paid a salary for their efforts. While such individuals are celebrated both in the business press and in popular culture as larger than life, the figures such as the Hedge Fund Manager were, until recently, nearly legendary characters in the case of contemporary life, they are still employees, and they serve at the pleasure of shareholders and boards of directors. Moreover, they can be dismissed, and of late they actually have been dismissed.

Despite the near universal condition of being a worker today in the industrialized world, people by and large do not want to identify themselves as workers, much less as laborers. This image problem may ultimately be more relevant to the future of the labor movement than declining union membership and declining pay and benefits relative to economic growth.

While in no sense a scientific poll, some time ago I formulated a detailed survey that I posted on Craigslist in Portland, which included questions about how people self-identify in relation to their work, and even from my modest effort it was very obvious that people did not want to call themselves “laborers” or even members of the working class. Needless to say, equally small numbers were willing to identify themselves as proletarians, although I have noticed over the past couple of years the ironic use of “prole” (an abbreviation for “proletariat”) when people want to both acknowledge their role as workers and to criticize the ways in which their work lives are compromised by stultifying policies and procedures.

While people hesitate to self-identify as workers and laborers, they know that they must labor to live in an industrialized economy. And, more often than not, they know that they must accept compromises in terms of what work they can do that will support them. Matthew B. Crawford in his Shop Class as Soulcraft: An Inquiry into the Value of Work (which I discussed in Back to shop class!) returns to this theme several times:

“As against the confused hopes for the transformation of work along emancipatory lines, we are recalled to the basic antagonism of economic life: work is toilsome and necessarily serves someone else’s interests.”

Matthew B. Crawford, Shop Class as Soulcraft: An Inquiry into the Value of Work, p. 52

Crawford also emphasized the trades as a dependable way to make a living, and this is a brave thing to say today, since the relentless advice given to young people is to get a degree (really, a credential) and move as rapidly as possible into the professional classes. But the problem (earning a living), and the practical response to it (getting work that actually pays the bills), are neither of them new. I was interested to find this in Samuel Butler’s The Way of All Flesh:

“Professions are all very well for those who have connection and interest as well as capital, but otherwise they are white elephants. How many men do not you and I know who have talent, assiduity, excellent good sense, straightforwardness, every quality in fact which should command success, and who yet go on from year to year waiting and hoping against hope for the work which never comes?”

This is a theme that runs throughout the book, and we find it again near the end:

“Being a gentleman is a luxury which I cannot afford, therefore I do not want it. Let me go back to my shop again, and do things for people which they want done and will pay me for doing for them. They know what they want and what is good for them better than I can tell them.”

I couldn’t find the exact quote that I wanted from Butler’s hilarious and still all-too-true novel, but these two quotes give a flavor of his opinion on the matter.

Doing things for people which they want done and will pay others for doing for them is often a wake-up call as to what the world really values. Some of these economic valuations border on the absurd, and certainly don’t seem like an optimal use of labor. Recently on the BBC there was a very interesting story about the high unemployment rate in Latvia, Fears over Latvia brain drain as economy struggles. Damien McGuinness of BBC News in Riga interviewed one Martins Neimanis, a civil engineer who was hoping to get work, “picking strawberries or packing vegetables in England.”

Sometimes, despite the effort we put into improving ourselves, we are more valued for the physical labor that we are capable of doing than for anything else. Here’s a personal example: recently I bought firewood from a neighbor who has a small photography business. The photography business in Portland is not doing very well at present, but he can sell firewood. So I bought firewood from him, because this is what I needed. I haven’t ever patronized his photography business. And I am in the same boat myself, so to speak. I had to self-publish my books because no one wants them, and I publish everything on this forum for free and count myself lucky if anyone bothers to read it. No one is going to pay me for it. But I can get paid for manual labor, so I do what I can get paid to do, though I would much rather be paid to think and to write, and I am probably much better at thinking and writing than I am at manual labor, but, by and large, others are not willing to pay for it.

Matthew B. Crawford in his above-mentioned Shop Class as Soulcraft: An Inquiry into the Value of Work made great sport of recent talk about the “creative class,” and deservedly so. This is a target than invites an arrow. Our above reflections make plain one of the weaknesses of trying to focus an economy on the creative class: mostly people are unwilling to pay for what the creative class produces, whereas they are willing to pay for shelter, food, and clothing. This can be a great disappointment to those of us who would like to be paid for our creative efforts, but it is a fact of life that cannot be wished away.

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