Nothing wrong with capitalism, the capitalists are the problem

In March 1964, a group including Linus Pauling, Gunnar Myrdal, Tom Hayden, Ben B. Seligmanm and computer pioneer Louis Fein sent a letter to President Lyndon Johnson covering their report on “The Triple Revolution.” The letter began: “We enclose a memorandum... prepared out of a feeling of foreboding about the nation's future. The men and women whose names are signed to it think that neither Americans nor their leaders are aware of the magnitude and acceleration of the changes going on around them. These changes, economic, military, and social, comprise The Triple Revolution. We believe that these changes will compel, in the very near future and whether we like it or not, public measures that move radically beyond any steps now proposed or contemplated.” They were right about the changes but underestimated our ability to drift towards the iceberg most would not see until much later.

The three revolutions were in cybernation, weaponry and human rights. The nuclear and other new weapon systems threatened peace. The African American struggle for equal rights in the US was part of the rising demand around the globe for full human rights. But the report focused on the affects of the cybernation revolution (their term). The combination of the computer and automation was issuing in a new mode of production as different from the industrial as that was from the agricultural. It would result in “almost unlimited productive capacity which requires progressively less human labor.” Yet the current economic model awarded access to this production, to the wealth it created, unequally to those with capital and those who earned their keep through labor. The cybernation of production would mean increasingly less of good paying industrial jobs. The US was experiencing this process first but it would spread throughout the world we dominated.

The report argued that having access to the collectively produced wealth of society could not any longer be tied to labor. Maintaining and improving individual wellbeing across society – through making maximum use of the potential of automated production – would have to transition from depending on good paying jobs. Income would have to be separated from work. This would require some form of guaranteed individual income and vast investment in public goods. Left to itself, the market would not move in this direction, it would require government action.

As it turned out, capital figured out a way to exploit the new cybernetic economy by shifting production to automation (and now AI) and to areas of cheap labor. Some developing countries – like China – followed suit using their cheap labor to industrialize. This form of globalization produced cheaper goods and did lift many from poverty, worldwide. But it mostly benefited capital rather than labor.

The Western democracies did little to ensure the political sustainability of free trade globalism. This would have required providing those reduced to un- and under-employment or low-paying service sector jobs with the decent income and public goods (including improved education, free healthcare and jobs created through spending on updating infrastructure) that we could have begun 60 years ago. The Western European democracies did a bit better than the US with their social welfare programs but still found themselves in this 21st Century facing the political drift to the right fueled by those left out of the wealth creation.

In the US, we got Trump and his MAGA movement. This virulent form of the anti-globalism reaction has plunged the world into Trump’s tariff war on the very foundations of the world capitalist order.

Nothing wrong with capitalism, indeed there seems to be no good alternative to markets coordinating supply and demand. Free trade to maximize market functioning is part of this (with some measures perhaps needed to ensure fair trade). The World Trade Organization could expand its trade liberalization agenda to include mandates to improve local living standards alongside fair labor standards. Rather than make war on the system of rule-based trade that we have benefited from, the US government would encourage foreign investment in our productive sector as part of a rational approach to whatever re-industrialization makes sense. (This could include China.)

The monopoly capitalists at the top of our cybernetic economy are the problem. They need to be taxed at levels considerably greater than their workers. Their ability to wield political power through money needs to be ended. Government must be empowered to ensure that everyone benefits from market functioning even if this means a form of guaranteed minimum individual income. The Democrats need to do more than wait for Trump to fail. Railing against the billionaires must be accompanied by explaining the need for change and advocating the policies laid out in that report to Johnson.

The Next 80 Years

Just finished the first two books of William Gibson’s latest planned trilogy: The Peripheral and Agency. Both are typically well written with plots and characters that briskly move a complicated story forward. Gibson has been ahead of his time since his 1984 sci-fi novel, Neuromancer launched the cyberpunk world of computer hacking anti-heroes. The new “jackpot” books are built around figures in the future (just prior and after 2100) using quantum entanglement to exchange information with people living earlier in this century. (Wikiquote describes the jackpot as “an ‘androgenic, systemic, multiplex’ cluster of environmental, medical and economic crises that begins to emerge in the present day and eventually reduces world population by 80 percent over the second half of the 21st century.”) The future period is in the aftermath of the jackpot, where whats left of humanity, after it was far too late, took climate change seriously. The earlier times (in the first book, 2032 and in the second 2017) take place when it was already far too late but we hadn’t yet changed how we live.

Gibson nailed it. To expand in my own words, these are the next 80 years.

It’s hard to know where to draw the line of when humans began degrading the world with the way we live. Was it with language, a bigger brain, fire and tools allowing homo sapiens to raise above mere animal abilities of tooth and claw? Or with the emergence of agriculture, where we began consuming our environment and changing the very face of the earth? Certainly with the industrial revolution and the utilization of hundreds of millions of years of buried sunlight in the form of hydrocarbons. Finally, with post-industrial, global capitalism, our consumption of the environment, and resultant waste dumped into it, increased exponentially.

This year, 2023, we have seen what must be – to anyone not totally fuddled by the paid climate change deniers – the many faces of climate change. Going well beyond mere weather extremes, it includes pandemics, drought, desertification, death of pollinators, failed crops and food shortages, unquenchable mega-fires, soot-filled air, regular “once-in-a-century” floods, climate-fueled illnesses (from hotter temperatures, swifter passage of pathogens and toxins), spreading invasive destructive and disease-causing pests, disappearing habitats, mass extinctions, ocean temperatures rising, over-fishing, death of reefs, melting ice and glaciers, garbage filled oceans and even whales attacking boats. Along with these are related violence and conflicts over mass migration, diminished water supplies, precious metals and growing domestic and global inequalities. Our own version of the Four Horses are saddling up.

Calling the tune is the oligarchy that benefit from the current form of global capitalism. They have been doing everything possible since big oil hid awareness of the implications of hydrocarbon use for the climate in order to maintain profits. They and their fellow mega-profit-maximizers have funded political elements resisting all efforts to challenge their power and seek even modest change in the dynamics of increased inequality and degradation of the environment. These political elements seek to divert attention away from the possibilities of real change by pushing backward-looking nationalism, racism, and fabricated cultural divisions meant to magnify the otherwise rational discontent with the world in which most of us now live into fear and rage directed at anyone but the rich and powerful. Thus many of those who might most benefit from change have nevertheless been convinced to accept outrageous lies and authoritarianism in its various guises.

There are few good guys among the world’s mega-corporations. The media platforms promulgate hate and directed misinformation. The new tech industries offering their magic are actually plunging us ever further into the technological singularity where fundamental change in our made-world runs ahead of our ability to understand and control it (AI and energy-intensive black crypto are certainly examples). And my iPhone, I must admit, is another opiate assuring us that we are up-to-date and in control of something (at the cost of far away miners dying in deep pits of rare earths.)

But we humans are likely to simply get used to the new normal exemplified by 2023. As long as it doesn’t happen to us it’ll remain just those things briefly floating into the media highlights. And so it is likely to go for the next 10, 15, 20 years until the cumulative changes chaotically coalesce into the widespread collapse of food chains (and not just for us), emptied aquifers, mass starvation, whole areas made unlivable by pervasive wet-bulb temperatures beyond 95o and the wars and domestic violence fueled when those who have nothing to loose try to get what remains from others. Then we descend into 40-60 years of continued catastrophe. Gibson called this the jackpot, I suppose somewhat ironically as everything comes due at once. He seems somewhat optimistic that, at some point, the economic and political elites will come to feel threatened enough – if only from the wholesale lost of customers – to look to the science and technology of green energy, carbon capture and revitalization of what’s left of the natural environment to reverse the effects of climate change. Surely, even now, such technology exists and is getting better all the time, but just not “economic” in the judgement of those who still make lots of money from hydrocarbons and those they have enlisted in their “anti-woke” crusades. So we will suck every last bit of hydrocarbons out of the earth before we change our approach enough to make a difference.

One can hope. Those living in the places where climate change is already threatening their lives, especially in the tropics, are trying to adapt and, if that is not possible, leave. We in the West have the biggest cushion. But we are too heading into bad times.

Language, Hunting and Bezos

Language makes us human and different from all other of earth's creatures. With it, we can think, plan and act. Other animals communicate with each other through various means (bees do it through dance). But only we have words and grammars, with which we can great structures of meaning. With language comes society, culture, science, technology, and history.

But from whence comes language? Perhaps from group hunting. Social carnivores such as wolves and lions do not have language but still coordinate hunting. Between early learning – cubs practicing innate skills and watching adults – and basic vocalizations, they can surround prey and attack in unison. Some whales coordinate their approach to circle their prey and drive them into a concentration that allows a dense feeding ball. But these creatures come with their weapons built in, fangs, teeth and claws or huge mouths.

Primitive humans did not have built-in weapons or thick hides. Out on the savanna, they were easy prey for other carnivores and would be poor hunters against anything big enough to satisfy the group’s hunger. They needed to make artificial weapons and, working together, use them to kill their prey.

At some point in human evolution, some series of chance mutations increased the brain’s capacity to process and organize information sufficiently enough to move beyond simple grunts and other calls towards a structured use of vocalizations. This would have provided a huge evolutionary advantage. Humans could begin to coordinate more elaborate approaches to prey animals.

Language – as it became more elaborate – would serve many other purposes, such as passing on learning about making weapons and which plants were good to eat and where to find them. But it may have been most useful at first in hunting. Homo sapiens even hunted the huge mammoths into extinction. The first leaders in human society may have been those most capable of using language to coordinate hunting.

Language allows the possibility of free-flowing thought. With words and grammar, individuals can recall the past, examine the present, probe accumulated human experience, and imagine a future to be pursued to advantage. Throughout human history, those that do this best made the best “hunters” and captured the biggest “prey.” They drove human development by finding new ways to exploit others and the found environment. As society superseded family, they also thought of monopolizing what they “captured” to turn temporary advantage into permanent advantage. Great war leaders might seek to become kings, great inventors owners of ever expanding conglomerates. Jeff Bezos seeks to own the core exchange mechanism of 21^st Century economy.

The drive to seek and maintain profit has provided a positive dynamic in human civilization. We cannot and should not seek to prevent the hunters from seeking new prey. Bezos and Amazon clearly show the advantages of the e-approach to economic exchange and it has become very useful during the current COVID-19 crisis. Bezos has even prodded old line hunters like Walmart into more effective ways. But allowing the best hunters free reign only works for the group when they share the meat.

A number of “tech giants” have now become the focus of attention for their efforts to monopolize their hunting style and for using it mostly for their own gain. It is reasonable for the rest of us – who also do our part to maintain the social and economic order – to look to limiting their ability to seek only self-enrichment. This doesn’t mean doing away with successful hunters – even if we could – but helping them share better through truly progressive taxation, less exploitative practices and perhaps breaking up their enterprises to create room for more hunters.

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.

Time to Be Progressive

It's possible to understand both of our two major political parties as having led America into a crisis. The Republican Party – in control of the US federal government and many states and in the hands of ideological and religious extremists – has been captured by an immoral egotist with no capacity for governing. In pursuit of elite interests and “conservative values,” Republicans have launched an assault on everything good in how our government has come to serve the common welfare since the days of Teddy and Franklin Roosevelt.

Democrats have not been on the playing field. They threw away the 2016 election by passing the presidential nomination through a politically correct form of primogeniture. The candidate threw it away through own goals and writing off voters in certain groups and states. Lacking any coherent vision to address the economic and social effects of globalization, the Democratic Party instead played to niche politics and appears to have little to offer beyond waiting for Trump to crash and the Republicans to burn.

Joe Biden does have a heart and could oversee cleaning up the mess the Republicans leave behind. But there must be a cohesive progressive agenda to go beyond that. Bernie Sanders and Elizabeth Warren understood that presenting voters with one could begin the process of putting the country on the right path again. A progressive agenda must begin with embracing the progressive income tax. Government needs money to serve the common good. Our tax system must be made more fair and taxes sufficient to meet our needs. (The Republicans have sought to subordinate this to cutting spending and a regressive taxing system favoring the owners of capital.) It need not be confiscatory but should treat the fruits of labor and capital equally with progressively higher tax rates on individual and corporate income no matter where it comes from and with very limited exemptions.

With adequate funding, the federal government can attend to the chief challenges facing American society in the 21st Century: healthcare, jobs, inequality and education.

Healthcare should be treated as a basic right as it is in other advanced Western societies. It need not be done through a government entity but perhaps with needs-based expansion of Medicare, a non-profit public option and/or payments to purchase insurance on open markets.

In the 21st Century, technology and globalization have conspired to reduce the need for human labor. There simply may not be enough good paying jobs for everyone. A reduction in the work week from 40 to 32 hours plus an increase in the minimum wage may help in opening job opportunities to a greater number. Federal funding to pay for some of the increase in the minimum wage could help reduce the burden on small businesses. Insofar as training will help prepare workers for new roles, government needs to fund that as well.

Inequality undercuts democratic community through making life for many nasty, brutish and short. The federal government should ensure some minimum income for those unable to work and those for whom jobs do not pay enough to rise decently above poverty.

Federal funds should support quality, free public education by focusing on providing modern facilities and adequately paid teachers and staff for all local public school systems. Federal oversight of local schools should be kept to the minimum required to ensure equal access.

Some elements of a progressive agenda need not require additional funding:

Money’s role in politics needs to be removed through campaign financing reform. A national commission on redistricting should oversee the drawing of congressional districts. Each vote should count equally.

A pathway to citizenship should be created for those now in the US “illegally.” A cross border agreement should be made with Mexico (and possibly with the Central American countries) so seasonal workers may go back and forth legally.

The role of contractors and lobbyists in the budgeting process – especially as concerns the military – should be subject to tight limitations.

The Democratic Party needs to begin talking to this agenda in the next three months and not only focusing on Trump’s disqualifications. Waiting for the Republicans to march lemming-like over their cliff might still not be enough and would nevertheless leave the country without a clear direction forward. Biden appears to be getting this.

Notes on "A History of Political Theory" -- Episode 6

For episode 5 see here.

Theory of the City-State

VI. Aristotle: Political Actualities
 A. Lays groundwork for the study of politics separate from the study of ethics
 B. Looks at the ethical basis, arrangement of offices, social classes within state,
       as well as recognizing the differences between the legal constitution and 
       the constitution in practice
 C. Analysis based upon an understanding of the political and economic
       constitution of the state
       1. Democracies differ according to inclusiveness and economic structure
          of the state
       2. Oligarchies differ on eligibility and distribution of property
 D. Three branches of government: deliberative, administrative and judiciary 
 E. Combining best of both types is the polity or constitutional government*
       1. Foundation of large middle class which is the most stable as not too
           rich or too poor
       2. Balancing of quality (aristocracy) and quantity (democracy)
 F. Defines state as community between contractual relations and paternal rule
 G. State originates from bare needs of life but continues for the sake of the good
       life -- which is the first truly civilized form. 
 H. The "nature"of a thing revealed after growth has taken place; nature redefined
       as convention. Through the growth of community comes the state.
 I. The state is natural because it contains the possibility of a fully civilized life
      but conditions must be right, thus an arena for the statesman to act.
 J. Fundamental constituents of nature: form, matter and movement
       1. Statesman must be descriptive and empirical to ascertain the possibilities
          of the actual
       2. Also must consider the ideal to give form to the possibilities

*Note:  Aristotle divides governments into six types, three ruled by the best one, few or many and their negative forms were rule is in the hand of those not guided by reason but by self-interest.

 

 Next week: The Twilight of the City-State