The Profit Motive

There can be no doubt that the profit motive provides a positive dynamic in human society. It is essentially the drive for Darwinian survival expressed in the economic realm. One can argue that the tremendous global changes brought about in the past few centuries have not been unambiguously good for us and the planet. But it’s also true that the profit motive has lifted human life to an entirely different plane. It provides for the sustenance and comfort of billions and has allowed mankind to reach for the stars. It also seems that there is not a clearly better way to run an economy. Inventors, makers and sellers trying to get buyers to pass them money for whatever it is that they are offering does, in theory and largely in practice, effectively and rationally organize economic exchanges. It seems much more likely that free markets of willing sellers and buyers works better than any one actor or group of actors trying to mandate or direct such exchanges.

But.

Darwinian adaptation is blind. It does not automatically lead to the greatest good for the greatest number. It aims instead at the continued viability and growth of the individual organism. The other members of the species or the ecological community may find themselves not much advantaged by the successful organism and may in fact be harmed or out-competed. The profit motive in human society operates in the same way and does not, by itself, work towards the greatest good for the greatest number. Over time, markets become encrusted with the Darwinian “winners” whatever else has happened to the others sharing the economy. Inequalities will increase and society will move ever further from distributive justice. (According to John Rawls, a just society is one in which we would be satisfied being born into if we did not know where in that society we would appear.)

Pure markets – where the profit-seeking winners take all – are rarely truly free. More to the point, no innovator or entrepreneur has created all the inputs and structures that make his or her business possible. Every individual “creation” of something profitable rests on the social, cultural, political, economic and built capital that was already there. So it seems fair to place some requirements and limits on successful enterprises and even certain incentives to nudge enterprises towards adding to social value as well as their own.

Some examples:

1. Progressive income taxes on individual and corporate wealth and income (from whatever source).

2. Inheritance taxes on every generation and similar turnover.

3. Various forms of government action to tilt income distribution back towards even such as livable minimum wage and unemployment assistance levels, some form of universal health care, cash payments to children born to parents below a certain income level, high quality and affordable primary and secondary education and vocational training and/or university.

4. Occasional and limited government actions and policies to avoid or ameliorate the broad social and economic impacts of economic disturbances.

5. Occasional, limited and restricted government support to promising and socially or economically beneficial technologies or enterprises.

None of this would entail abandoning the profit motive (or capitalism) but would instead go in the direction of perfecting its results.

Continuing Notes on Sabine's "A History of Political Theory" -- Episode 32

For episode 31, see here

The Theory of the Nation-State: The Moderns

XXXII. Communism
 A. Communism, or Marxism-Leninism, was adaption of Marxism to
     epoch of imperialism and particular conditions of Russia (more
     generally, non-industrial economies and societies with peasant
     populations).
 B. Lenin led the Bolsheviks, favoring a vanguard party approach
     against the Menshevik faction favoring a democratic party. 
 C. Lenin pointed out that workers do not become socialists but
     trade unionists so socialism must be brought to them from
     outside by middle class intellectuals.
       1. Democracy consists of not running ahead of people (by
           advocating what they cannot follow) or lagging behind.
       2. Vanguard party provides goals that will work without undue
           use of force.  
       3. The party has science in Marixsm (rather than doctrine of
           religion).
       4. The party also has a dedicated, disciplined elite.
       5. Democratic centralism, freedom of discussion before the
           decision is made but not after. 

"The dialectic, Lenin wrote in one of his notebooks, is 'the idea of
the universal, all-sided, living connection of everything with every-
thing, and the reflection of this connection in the conceptions of
man.'" (820)

 D. Lenin and Trotsky argued for a combined bourgeois and
     proletarian revolution in backward countries.
       1. Proletarian revolution in Russia had to include, at least
           initially, the peasants.
       2. Could only succeed, however, if hooked up to proletarian
           revolutions in the West.
       3. Alliance with the peasants was first revolution, shift to
           European proletariat would be the second.
       4. Extension of capital to underdeveloped nations becomes
           necessary when monopolies are established in home markets.
       5. Imperialism results and competition between imperialists
           become war.
       6. High profits from imperialist exploitation enables imperialists
           to pay off their own workers.
       7. This condition is artificial and the European proletariat will
           become revolutionary in line with Marx's predictions.
       8. The oppressed nations would then add to the proletariat.
       9. Proletarian nations would be most likely to produce revolution.
 E. But with the outbreak of WWI in 1914, Western socialist parties led
     their proletariat to patriotic support of the war.
 F. Upon success of the revolution first and solely in Russia, Lenin
     found only one tangible, usable institution, the party.  
 G. Stalin added the concept of socialism in one country.
 H. State transformation of the economic base cut final tie with
     conventional meaning of economic determinism.

Next week: Fascism and National Socialism

Notes on "A History of Political Theory" -- Episode 26

For episode 25, see here

The Theory of the Nation State: The Moderns

XXVI. Jean Jacques Rousseau and Rediscovery of Community
 A. Great gap between Rousseau and his contemporaries.
 B. Was a deeply divided personality, noble vs base, ideal vs real.

     "More than most men, Rousseau projected the contradictions and maladjustments of his own nature upon the society about him and sought an anodyne for his own painful sensitivity. (Sabine, 577)"

 C. Used contrast between the natural and the actual not as appeal to reason 
      but to attack reason.
 D. Against intelligence, growth of knowledge and Enlightenment progress,
      he set amiable and benevolent sentiments, good will and reverence.

     "What gives value to life is the common emotions, perhaps one may say instincts, in respect to which men differ hardly at all and which he imagined to exist in a purer and less perverted form in the simple uneducated man than in the enlightened and sophisticated."

 E. Based his values on "realities" of everyday life.
 F. Intelligence and science are dangerous because they undermine 
     reverence and faith.
 G. Pulled philosophy away from union with science and implanted 
      distrust of intelligence.
 H. Rejected systematic individualism and self-interest as virtue.
 I.  Took from Plato a general outlook.
       1. Political subjection is essentially ethical and only secondarily a
           matter of law and power.
       2. Community itself is chief moralizing agent and represents the
           highest moral value.
       3. Therefore fundamental moral category is citizen not man.
 J. Saw rights not as against community but within it.
       1. Natural egoist is fiction, some kind of community is inevitable,
           society is purely instinctive.
       2. Community has corporate personality, a general will.
       3. Government is agent for this will (could be radical or conservative).
       4. General will is the source of law and morals.
 K. The General Will
       1. Saw city-state as the best example of venue for the general will.
       2. Contract useful device even though government has no
           independent power; citizens exist as members of society,
           individuals have no rights except as members of the community.
       3. General will is the collective good of the community which is not
           the same as the private interest of its members.
       4. Men become equal within a society not because (per Hobbes)
           their physical power is substantially equal.
       5. Absolute authority of general will vis-a-vis indefeasible individual
           rights.
       6. When one is forced to obey general will, one is being forced to
           be free because one doesn't know his own good.
 L. Rousseau originated romantic cult of the group contrary to rationalist's
      cult of the individual.  
 M. In adapting the model of citizenship within the city-state to modern
      modern nation-state, Rousseau helped to recast it in such a form
      that national sentiment could appropriate it.
 N. Rousseau's impact
       1. Idealizing moral feeling of the common man led to Kant
       2. Full significance of idealizing collective will and participation in the
           common led to the idealism of Hegel.
       3. Descartes split reason from custom, Rousseau tacitly set it aside,
           Hegel tried to reunite them.
       4. Burke supplied missing content to "general will" by giving
           corporate life of England (custom and tradition) a conscious reality.

Next week:  Convention and Tradition -- Hume and Burke










 
 


 
 




 

Notes on "A History of Political Theory" -- Episode 22

For episode 21, see here

The Theory of the Nation State

XXII. Radicals and Communists
 A. Radical individualism also arose in left wing popular democracy during
      civil wars.
       1. Dissolution of traditional institutions and resulting economic
           pressures were facts not theories.
       2. Individualism grounded in these facts.
 B. English civil wars mark first appearance of public opinion as important
      political factor.
 C. Levellers: radical middle-class democrats.
 D. Diggers: beginning of utopian communism, considered political reform
     superficial unless it included redress of economic inequalities.
 E. Levellers
       1. Movement started by radical soldiers of Cromwell's army concerned
           that the reforms of the revolution would be lost.
       2. Sought political equality and the end of priviledge.
       3. Connected to religious Independents. 
       4. Argued that unnust law was no law at all, even if traditional or
           common.
       5. Saw innate and unalienable rights for which legal and political 
           institutions exist only to protect.
       6. Was party of men of small property facing officers who sought 
           only moderate reform leaving power in the hands of landed
           gentry.
       7. Saw Parliament as stand in for the sovereign people.
       8. Every man had right to consent to law through his representative.
       9. Argued for representation of individuals not interests, paralleled view
           of community as a permanent reality vs. conception of nation as
           simply a mass.
       10. Levellers made natural law into a doctrine of individual rights
             (with property right as primary) .
 F. Diggers
       1. Saw natural law as a communal right to means of subsistence.
       2. Individual had only the right to share in the product of common
           land and common effort.
       3. Private property the root of evil and social abuse.
       4. Gerrard Winstanley's Law of Freedom saw in human nature two
           opposed tendencies toward:
             i. Common preservation -- the basis of commwealth
             ii. Individual preservation -- the basis of kingly government or
                government by buying and selling. 

Next week: The Republicans: Harrington, Milton and Sidney