Saturday, October 11, 2014

Piketty for Progressives -- Part 3

Thomas Riggins

5. From Marx to Kuznets, or Apocalypse to Fairy Tale

As we have seen, Piketty rejects Marx's views about the future of capitalistic inequality, which  he called "Apocalyptic", and in this section he will also reject the views of Simon Kuznets (1901-1985) which he finds too optimistic.  Kuznets engaged in empirical studies and arrived at the view that as capitalism became more advanced income inequality would decrease-- on the principle (mis-attributed to President Kennedy) that "a rising tide lifts all boats."

Although Piketty does not accept Kuznets’ conclusions, he credits him with being the first to empirically utilize two sources of information which must be used in conjunction to be able to meaningfully study income inequality and its evolution__ i.e., growth of national income for a country and the distribution of that income to individuals. It was using such information that Kuznets arrived at his views regarding the decrease of inequality. The question is--  did the data reflect universal trends within advanced capitalism or just an historical fluke? If the latter then Kuznets’ theory was a "fairy tale"-- as Piketty suggests by this section title.

6. The Kuznets Curve: Good News in the Midst of the Cold War

In this section Piketty says that Kuznets admitted his statistical discovery of a decrease in inequality in the US (the period covered was 1913 to 1948) was “largely accidental.” In his 1953 book Shares of Upper Income Groups in Income and Savings he even admonished his readers not to jump to conclusions based on his data. But that is just what he did himself two years later in a famous lecture where he proposed a bell curve to explain the relation between capitalism and inequality. As capitalism begins to develop inequality increases between the capitalists and the general population and peaks just as capitalism becomes mature and widespread, thereafter it begins to decline as the benefits of the capitalist system begin to be shared by all.

Even in this lecture Kuznets says his statistics reflect unique historical circumstances, but also suggests that, despite the historical specificity that shaped his curve, the inherent nature of the capitalist system itself would also work to produce the curve. This was simply cold war propaganda posing as science. Piketty points out that in the lecture Kuznets told his audience (it was a speech to the American Economics Association) that he was giving an optimistic twist to his theory to, in his own words, keep the Third World “within the orbit of the free world.”

Nevertheless, despite this lecture and other papers, Piketty says that Kuznets showed the true “scientific spirit” in his big 1953 book (the supposed first use of meaningful statistical analysis) even if the Kuznets curve is a fairy tale. It was the two world wars and the Great Depression that brought about a decrease in inequality not the inherent tendency of capitalism.

7. Putting the Distributional Question Back at the Heart of Economic Analysis

Piketty thinks the question about how wealth is distributed is important. He says there has been a big increase in economic inequality since the 1970s— in all the developed countries, but especially in the U.S. In the Third World it is possible that economic development may decrease inequality— especially the development of China. All of this, he says, is a cause “of deep anxiety.” He does not make clear why this should be so— whether it is the growth of inequality, the development of China, or both.

Also, markets that are supposed to exhibit “balanced growth” according to Kuznets and others ( real estate, oil and financial) are showing remarkable “disequilibrium.” Piketty asks who will be running the show in 2050 or 2100 (i.e., controlling the world as it were). He lists several possibilities, one of which is the Bank of China. I can see the origin of “anxiety.” The Bank of China is ultimately under the control of the Chinese Communist Party (it is state owned).

In any case, the distribution of wealth becomes, for Piketty, the most important area of study if we are to understand the growth of inequality. To determine this we must collect data on the economic history of many countries and forecast future developments by a scientific understanding of past and present trends.

8. The Sources Used in Piketty’s Book

Piketty says his work is basically an extension of the work begun by Kuznets in his study of the period 1913-1948 in the U.S.  Kuznets’ statistical methods were extended to France, the contemporary U.S., and to other countries. But “the primary source of data” for the book comes from the World’s Top Incomes Database (WTID). [Google: The World’s Top Incomes Database]

Piketty says there are TWO components of income— from labor and from capital.
He says labor income consists of wages, salaries, bonuses, non-wage labor, and income “statutorily classified” as such [tips?]. Capital income consists of rent, interest, dividends, profits, royalties, capital gains, and “other income” from land, real estate, financial instruments, industrial equipment, etc. [!]. It is obvious that this is an un-Marxist way of treating income but Piketty can define his categories anyway he chooses since he is not a Marxist economist. We shall see later how useful, or not, his definitions are.

Piketty says his book “stands out” from those before it because he has “made an effort to collect as complete and consistent a set of historical sources as possible" for the study of the distribution of income and wealth “over the long run.”

We will resume the fourth installment  of this commentary on Piketty’s introduction with the 9th section :“The Major Result’s of Piketty’s Study.”

Thursday, October 9, 2014

Piketty for Progressives-- Part 2

Thomas Riggins

“Introduction” to Capital in the Twenty-First Century— Part 2

2. Malthus, Young and the French Revolution 

This section is not particularly enlightening as it is mostly just descriptive. We are informed that Thomas Malthus (1766-1834) wrote his 1798 work "Essay on the Principle of Population" based on few sources, one of the most important of which was a travel diary that the British agronomist Arthur Young (1741-1820)  published of his trip to France (1788-89) where the extent of poverty he saw led him to fear a revolution was in the offing. Malthus was led to believe the social troubles facing Europe as a result of the French Revolution and the changing economic conditions of the day were caused by overpopulation. Too many poor people were being born and not enough food could be produced to feed them. His solution was to advocate the end of any kind of welfare aid to the poor (let nature take its course) and to discourage their procreative activities. Piketty says we cannot understand the extreme views of Malthus without understanding the role that fear played in a Europe experiencing revolution, fast economic changes, and the rapid increase of population and poverty occasioned by the Industrial Revolution. He stress that the theoretical work of the time was based on limited sources due to scanty record keeping by modern standards. 

3. Ricardo: The Principle of Scarcity 

Piketty says in retrospect we might make fun of the dark prophecies the nineteenth century  thinkers made concerning the dire consequences that the development of the class nature of capitalism and the consequent unequal distribution of wealth seemed to indicate.  He seems to think “these prophecies of doom” did not happen  but were justified by the “traumatic” changes the development of capitalism and the Industrial Revolution engendered. David Ricardo (1772-1823) and Karl Marx (1818-1883) “the two most influential economists of the nineteenth century” both had apocalyptic views of the future. Ricardo thought the wealth of society would be monopolized by the owners of land, Marx by the industrial capitalists. In this section Piketty discusses Ricardo’s views. 

Ricardo's interests were in the price and rent of land and were expressed in his 1817 book "Principles of Political Economy and Taxation." He had few statistics to work with, Piketty says, but he understood contemporary capitalism and further developed the theories of Malthus. As population grew the demand for land (for agriculture especially) would go up and so would its price and consequently the amount that could be charged as rent.  
Eventually the landowners would be getting the lion's share of the wealth expressed as income and the rest of the people would be getting less and less. Unless taxes on land were radically increased to readdress this income imbalance social stability would collapse and the spectre of the French Revolution would arise to haunt Europe. 

Piketty points out that Ricardo was wrong because of technological and industrial developments that took place after his time that diminished the role of agriculture in the economy. Nevertheless, Ricardo's views on the role of "scarcity" were insightful as they indicated that the prices of certain commodities (goods and services) could get out of hand and disrupt society, especially in the present age when the global economy is coordinated and kept in balance by an international pricing system.  "The problem is," Piketty says, "the price system knows neither limits nor morality." 

Here is a classic example of the problem of reification discussed by Marx in the first volume of Capital in the chapter on the fetishism of commodities. Something created  by human beings takes on an "independent" existence and enthralls its creators who treat it as as some kind of  self-subsistent entity whose laws we are subject to and incapable of changing or abolishing. 

Scarcity could still be a problem in our century. But there is a way to contain problems of scarcity-- namely supply and demand. Piketty says if prices get too high because of lack of supply, then people will not buy  and the demand will lessen causing the prices to fall. But what about a problem with the food supply? Not enough food, sky high prices, people can't buy-- but will the demand for food lessen? It would not. It's possible that food purveyors would end with a wholly disproportionate and unequal share of social wealth in their control.  Piketty thinks in this sort of situation a Ricardian Apocalypse is theoretically possible. However, he doesn't think it will ever come to this but will put off further consideration of this problem until later in his book where his treatment "will be more nuanced.” 

4. Marx: The Principle of Infinite Accumulation 

By the time we get to Marx in the second half of the nineteenth century (Capital Vol. I came out in 1867) the main problem was understanding how industrial capitalism actually worked and what was responsible for the immiseration of the  industrial working class [and not just it alone]—“the most striking fact of the day.”

 During this period, right up to World War I, Piketty says, the evidence indicates that there was growing income inequality with the ruling class expropriating more and more of the social wealth created and leaving less and less for the working people and others in society to share. He says this “endless inegalitarian spiral” only came to  an end due to the shocks of the World War and only these shocks could have halted the growing inequality let loose by the Industrial Revolution. [One of the biggest shocks was, incidentally, the Russian Revolution and the forces of social consciousness it unleashed on the planet— still somewhat reverberating throughout the world.] 

Piketty dates the birth of  the “first” movements of socialism and communism to the 1840s (actually there were even earlier movements dating back to at least the seventeenth century) when people began noticing that while capitalism was working for the capitalists, enriching them, the working people were not benefiting from the system and were subjected to the same kind of miserable living conditions as they had in the pre-capitalist past.  

Enter Karl Marx who sets himself the task of explaining how capitalism works and why it keeps the working people is such miserable conditions (relatively speaking). Piketty says Marx built his system (expressed in Capital ) on two principles he took from Ricardo— the principles of the price of capital and of scarcity. It is true that Marx had great respect for Ricardo but he actually rejected Ricardo’s price theory, and replaced it by his own original theory developed out of his concept of labor power and surplus value based on socially necessary labor time. I don’t see how Ricardo’s views on “scarcity” played any positive role in Marx’s system as Ricardo’s theory was developed in the context of his misconceived theories of agricultural rent. 

Pekitty also says that Marx developed a “principle of infinite accumulation” in which he showed “the inexorable tendency for capital to accumulate and become concentrated in ever fewer hands, with no natural limit to the process.” Piketty then says this is the foundation of his “prediction of an apocalyptic end to capitalism.”  Either the capitalists will fall into violent conflicts over their inability to keep accumulating (it isn’t infinite after all) OR the workers will revolt because “capital’s share of national income would increase indefinitely.” 

Yes capital must continue to accumulate to survive in Marx’s system, but there are natural limits— namely saturating the market both domestically and eventually world wide. It was these conditions that led to monopolization, colonialism, and imperialism and brought about the apocalyptic twentieth century in which the capitalists managed to set off, two world wars, ignite both the Russian and Chinese revolutions, destroy the lives of hundreds of millions of people and usher us into the present century in which they have instigated violent conflicts in Europe, Africa and Asia anyone of which could set off a more general war. The instability of capitalism is as great as it ever was and poverty is spreading everywhere (except mostly in those countries still maintaining communist governments). Therefore, Piketty’s conclusion that  “Marx’s dark prophecy came no closer to being realized than Ricardo’s” is considerably premature— the game is still afoot. 

This introduction has a strange reading, I think, of twentieth century history— it improves later in the book. He doesn’t see World One I as part of Marx’s Apocalypse but admits a communist revolution did break out in Russia “the most backward country in Europe.” However, “fortunately for their citizens” the advanced European countries “explored  other, social democratic, avenues.” I don’t know how advanced Spain and Portugal were after the war (WWI) but I don’t think Franco or Salazar qualify as social democrats, nor do Hitler, Mussolini, or P├ętain. By and large I don’t think the citizens of the “advanced” countries had a very fortunate century. 

There are two other comments on Marx in this section which are unjustified. The first is that he “neglected the possibility of durable technological progress and steadily increasing productivity” as “counterweights to accumulation and concentration of private capital.” Marx did not “neglect” either technological progress or increased productivity but he saw them not as counterweights but as the results of the accumulation and concentration of capital.  

The second unjustified comment is that Marx did not devote much time to speculating about how a post capitalist society would be structured. This is meant to be seen as a failing on Marx’s part but that would be an error. Marx did not think it a good use of his time to engage in utopian speculations on the future but he did study the example of the Paris Commune of 1871 and discussed the economic and political actions that would have to be undertaken in a post capitalist society (“The Civil War in France”) and his ideas were elaborated on later by both Engels and Lenin. There is a Marxist literature on this subject to which Piketty could have referred. 

Piketty ends this section by saying Marx is still important to study and that his principle of “infinite accumulation” is still at work in the twenty-first century but not as “apocalyptic” as he thought. But this is faint praise and seems to miss the point of what accumulation is for Marx and why Marx is still important. 

Piketty says too much accumulation of wealth when population and productivity growth rates are low can lead to social disequilibrium. But Marx isn’t talking about accumulation as too much private wealth. When Marx says “Accumulate, Accumulate! That is Moses and the prophets” [Capital I c. 24, section 3] He means that the wealth accumulated is to be reinvested in production because capital must expand itself continuously or perish. By reinvesting the capital people are put to work the economy expands and more accumulation is generated to do it all over again (until a crisis due to capitalism’s contradictions.) Marx is still important because this movement of capital is still going on and still creating crises (we are in one now) and the spectre haunting Europe has not been exorcized. 


Part III of the this introduction will continue with Piketty’s section “From Marx to Kuznets, or Apocalypse to Fairy Tale.”  

Sunday, August 24, 2014

Eleanor Marx: A Life [Book Note]

Thomas Riggins

Rachel Holmes' new biography of Eleanor Marx (1855-1898) is coming out in the US early next year  and can be pre- ordered at Amazon.  Here I am posting some notes from "Troubles of Tussy" by Elaine Showalter (TLS August 22 & 29 2014). "Tussy" was the Marx family's nickname for Eleanor.

Ms. Holmes calls EM "the foremother of socialist feminism." EM was the fourth child of Karl and Jenny Marx and thus a member of the world's original set of red diaper babies. She was home schooled by her father and could quote passages from Shakespeare when she was three years old. She became a avid socialist at a young age (hanging out with Marx "one of the greatest minds in Europe" and Engels her "second father" may have unduly influenced her!) At sixteen she became her father's private secretary and he took her with him to meetings and congresses both at home and in Europe.

Eleanor also became a leading proponent of feminism. It seems that even Marx and Engels, who were champions of women's rights had difficulty putting into practice what they preached-- the nineteenth century was not noted for being very open to the rights of women.  Jenny Marx,  AKA Mrs. Karl Marx , once wrote, as quoted by Showalter,  regarding the activities of the male socialists that "in all these battles we women have to bare the hardest, i.e., pettiest parts. In the battle with the world the man gets stronger ... we sit at home and darn socks."

But EM did not stay home and darn socks. She became super-educated for her time and helped her father in the researching and writing of Das Kapital. She also organized workers and gave speeches to large crowds: "Karl Marx was the theory," Holmes says, "Eleanor Marx was the practice."

Some of noted accomplishments: she translated the first English edition of "Madame Bovary" as well as several plays by Ibsen-- and performed the first staged reading of his "A Doll's House" playing Nora. She also translated Edward Berstein's book on Lassalle from German into English (she was, naturally, fluent in French, German and English among other languages-- Ibsen wrote in Norwegian). She also translated a history of the Paris Commune from French to English, as well as Georgi Plekhanov's Anarchism and Socialism.

Unfortunately she hooked up with a genuine cad in the form of Edward Aveling (he co-authored with her the very important Marxist work "The Women Question") ["the founding text of socialist feminism"]who, after many years of living together, secretly married a young actress of 22 [typical male menopausal action] which made her so despondent she killed herself at the age of 43. Aveling died four months later of kidney disease (aged 49). This very last action of hers was unMarxist but her biographer still thinks her life was inspiring and indeed exemplary. The reviewer concurs, writing that "With the infectious conviction of her narrative, Rachel Holmes has restored her to history." Personally, however, I don't think EM was ever lost to history.

One caveat: the portrait of Eleanor Marx at eighteen published in the TLS along with this article is actually a portrait of her sister Laura Marx (who also committed suicide!). At least it appears as such in the book Marx's General and also on the internet as Laura.

Saturday, August 9, 2014

Piketty for Progressives

Thomas Riggins

"Introduction" to Capital in the Twenty-First Century-- Part 1

Piketty opens his book by telling us the questions he wants to answer are two diametrically opposed queries stemming from the works of Karl Marx on the one hand and Simon Kuznets on the other. From Marx-- does capitalism inevitably lead to the concentration of wealth in fewer and fewer hands ?  From Kuznets -- does the later development of capitalism lead to less inequality and more social harmony between the classes? A third question is what lessons can we learn and apply to our present century from a study of wealth development since the eighteenth century?

Piketty admits that the answers he gives to these questions are "imperfect and incomplete." Now if you write a book whose conclusions are imperfect and incomplete you are inviting a lot critical commentary not only from the Left but  from the Right as well. In this respect the reception of his book has not been disappointing.  He thinks however his research provides a "new" way to understand the inner workings of capitalism. We shall see.

He believes that current bourgeois economic "science" has become so sophisticated  that the "Marxist Apocalypse" can be avoided. This is, however, an article of faith and no argument is advanced to substantiate this claim. He doesn't exactly say what the "Apocalypse" is but I rather think it refers to the collapse of the capitalist system and its replacement with a socialist economic order. Marx did give an argument for this outcome based on his analysis of the inner contradictions of the capitalist system. This analysis is in his work Capital which book Piketty mentions in passing only three times in his own book (according to the index, but I counted more) giving no indication that he read Marx's work.

Piketty admits that if/when capitalism provides a greater return on capital than it does on income and economic growth "then it automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based." This is quite a statement. It assumes we live in democratic societies where a person's social condition is based on merit. This is I think demonstrably false for the politically corrupt oligarchical societies of the West with which Piketty is concerned. Race, ethnicity, family background, wealth, availability of opportunities are the actual factors that determine the social conditions of people living in capitalist democracies not "merit." To say our societies are based on "values" that are plainly non-operative beyond the verbal level is no way to go about understanding reality as if effects most people.

He thinks there are ways democracy can "regain" its power over capitalism. He says "regain" because he thinks these negative features of capitalism were operant in the nineteenth century but were not so dominant in the twentieth (!) but seem "likely" to come into force in the twenty-first century. There are few, if any, people on the Left, I think, who view the twentieth century as a success story for meritocratic democracy (except maybe in a few isolated pockets).

Well, I don't want to jump to conclusions so let’s look more closely at the introduction to his book:

A Debate Without Data?

In this section Piketty points out that previous  theories about wealth and inequality have been based on a narrow set of facts that have been appealed to support many different interpretations. He is going to explain his sources and how he and his associates have expanded the amount of data available to researchers.

He also makes some comments in this section that reveal an interesting set of subtextual assumptions of which progressives  (especially Marxists) should be aware.  For instance, inequality is, he says, visible to many kinds of people and many different theories as to its causes flourish due to inadequate data. He tells us peasants and nobles, capitalists and workers, and bankers and non-bankers  [and we might add “slaves and masters” to the mix as well-tr] all see the world differently. Each group sees different “aspects” of reality and this conditions their outlook on justice and injustice. “Hence there will always be a fundamentally subjective and psychological dimension to inequality, which inevitably gives rise to political conflict that no purportedly scientific analysis can alleviate.”

One of the purposes of Marx’s Capital was to show just what nonsense this is and that class struggle and exploitation have objective roots in external reality and can be scientifically understood. Political conflicts between workers and capitalists (just as slave rebellions and peasant uprisings) are not the result of subjective psychological problems due to feelings of oppression because the “oppressed” group only sees its own “aspect” of reality. They are objective historical facts that can be scientifically studied and remedied by a correct understanding of the relations of production and distribution and the mode of value creation within a given society and Marx presents arguments to support his conclusions rather than just stating them as matters of fact.

All sides are represented in [bourgeois] democracy, Piketty thinks, and since there is no scientific explanation for the resolution of the political problems engendered by the subjective psychological reactions of different groups to their experiences of inequality we can conclude “Democracy will never be supplanted by a republic of experts— and that is a very good thing.” Piketty’s value judgment is, of course, a subjective psychological reaction to his understanding of the nature of inequality.

Piketty does see an important role, however, for the class of “experts” to which he himself belongs. While, he maintains, they cannot provide a solution to the  violent  political conflicts that inequality naturally engenders, they can do research which “will inform democratic debate and focus attention on the right questions.” Piketty says intellectuals such as himself “have the good fortune to have more time than others to devote themselves to study (and even to be paid for it— a signal privilege).” Yes, but who is the paymaster?

Before going into detail on his new methods he wants to present an historical review of how the problems of inequality were dealt with in the past, and so we move on to Part 2 of this review and will resume with the section entitled:

Malthus, Young, and the French Revolution

Wednesday, June 25, 2014

Piketty, The Wall Street Journal, and Rational Conservatives


Piketty, The Wall Street Journal, and Rational Conservatives
Thomas Riggins

Thomas Piketty's book, Capital in the 21st Century, has almost had the effect of a tsunami on economic thinking here in the United States after its translation from French into English washed up on our monoglot shores. In France itself it has been treated as more or less just another economics book-- no big deal.

Its impact on the US is due to many factors, not least of which is the fact that our educational system is woefully inadequate by European standards as well as our lower cultural literacy compared to Europe. Piketty's work appears here as a revelation, but to the educated European he is only providing a fuller historical context for what most people already understand.

Marxists, especially, should have been under whelmed to learn that the capitalist system creates imbalances in wealth with a large pool of poor and exploited workers at one pole and a small group of capitalists hogging the social wealth at the other.

Piketty tells us this system is not sustainable and to prevent the "Marxist Apocalypse" the capitalists have to modify their behavior and moderate the social inequalities their system creates. The thought that capitalism might be replaced is indeed an apocalyptic nightmare for the bourgeoisie but for the working classes it might be more like a Marxist Epiphany come true.

The Wall Street Journal, no friend to the Left, has reviewed Piketty's book ("A Not-So-Radical French Thinker" by Pascal-Emmanuel Gobry, weekend edition May 24-25, 2014). Here we find, implicitly, that not only have some on the Left "lost it" over seeing Peketty as some sort of super progressive, but that many American "conservatives" have, explicitly, also gone completely off the deep end by referring to Piketty as a "soft Marxist."

The conservative movement is the U.S. is, however, overloaded with "thinkers" who are intellectually immature and dishonest, selling their brain power (such as it is) to the Koch brothers, the Murdochs, and their ilk. The WSJ review points out that Piketty is a professional academic economist and his book merits consideration. He is a neo-liberal economist who supports market capitalism and, like many other neo-liberals, he advocates "government redistribution to smooth out some of the market's excesses.".

The WSJ points out that in France you can find "honest-to-goodness actual Marxists [that] are still at large" and Piketty is not one of them. The fact that he has simply described how capitalism is actually functioning and this is enough to send so called conservative intellectuals into a nose dive (one from the American Enterprise Institute is especially mentioned) over "soft Marxism"  is evidence enough that many, I think most, conservatives have no regard at all for the facts or even rational discussion but are only mouth pieces for the corporate interests who support them as paid propagandists.

Piketty is worth reading. Marxists have a deeper understanding, I think, about the functioning of the capitalist system so there will be no surprises here, but readers will find a detailed history of wealth distribution and creation over the last three hundred years that will convince anyone with an open mind that this system is exploitative and is leading towards an implosion that could very well destroy it.

Marxists, of course, think the system must be replaced and is ultimately existentially unreformable. Neo-liberals such as Piketty do not agree and he proposes reforms in his book which he thinks will save the sinking ship (such as an international, or at least a European Union, wealth tax).

The WSJ review suggests that the right wing could benefit from reading Piketty. If the inequality he describes is not remedied "it could undermine the social order" and "for all the huffing and puffing about Mr. Piketty's supposedly revolutionary ideas, that conservative insight might be his most lasting contribution to the American debate." Indeed, it well might.

Friday, December 20, 2013

Waiting for Mangabe or Slavoj Zizek on Mandela's Socialist Failure


Thomas Riggins

This is a reply to Slavoj Zizek's article "Mandela's Socialist Failure" published online in The Stone (a New York Times maintained philosophy blog) on December 6, 2013. In eight pithy paragraphs Zizek endeavors to expose the real legacy of Mandela as opposed to his current "beatification." The Catholic Church used to have someone play the role of Devil's Advocate to denigrate the reputation
of a person nominated to become a saint. Zizek has taken it upon himself to see to it that Mandela's "beatification" does not progress to full fledged "sainthood."

Zizek's mantra is that "Mandela was not Mugabe"-- the "good" as opposed to the "bad" Black African leader. Mandela is seen as "a saintly wise man" and Hollywood even makes movies about him. He was "impersonated" by Morgan Freeman who, Zizek points out also impersonated God! Oh my!-- what are they trying to tell us? Zizek should perhaps be reminded that Morgan Freeman is an outstanding actor (or impersonator if you prefer) and has played many roles-- including a chauffeur. And, Zizek notes, "rock stars and religious leaders, sportsmen and politicians from Bill Clinton to Fidel Castro are all united in his beatification." Somehow I don't see Fidel Castro as a "politician" in quite the same way as the unprincipled pragmatist Bill Clinton. Nor do I think Fidel and Clinton are "united" in their evaluations of Nelson Mandela-- far from it. According to Zizek, Mandela is hailed for leaving behind "a muti-party democracy with free press and a vibrant [!] economy well-integrated into the global market and immune [!] to hasty Socialist experiments."

But what is the truth about this man's legacy? The Devil's Advocate will reveal  "two
key facts"  that are "obliterated" by all the pro-Mandela beatification activities. Fact One: There is still wide spread poverty and social misery in South Africa and an increase in "insecurity, violence, and crime."  The majority of Black  South Africans
are living "broadly,"  Zizek says, "the same as under apartheid." This fact "counterbalances" any "rise of political and civil rights."  What is the "main change" in South Africa since the time of Mandela according to Zizek? It is a "new black elite" has joined the "old white ruling class"-- not a new constitution giving equal rights to all citizens and allowing all South Africans to live and work together.

Zizek's statements are completely ridiculous. There are deepening economic problems in South Africa today as well as class divisions but Black people and all South Africans no longer have to carry passes, all can vote, people can go to the same beaches and hotels, etc. The millions who mourned the death of Mandela are acutely aware of the problems facing their country and also aware that the repressive, dehumanizing regime of official racism and apartheid is dead. To think that reality has been "obliterated" in the consciousness of South African people by a Mandela sainthood cult is an insulting affront to the citizens of the new South Africa and reeks of a colonial European outlook towards African peoples. So much for "Fact One."

Fact Two: Black South Africans are becoming angry because the memory of the aims of the "old" African National Congress (social justice and a "kind of" socialism are being "obliterated from our memory." Far from being "obliterated" the program of the ANC and its allies in the labor unions and the South African Communist Party are constantly debated and discussed by the people of South Africa and the demands for more radical reforms and more progressive policies can be democratically advanced. Zizek overlooks the fact that there is a real living democracy at the root of the New South Africa and that Nelson Mandela played a major role in its creation. The millions mourning his passing are not mindless masses with "obliterated" memories.

According to Zizek South Africa is just another example of the current left paradigm:
the left comes to power promising a "new world" but then confronts the reality of the international neoliberal capitalist consensus . Imperialism can speedily punish countries trying to embark on the socialist road. In South Africa's case political power was ceded to the ANC on condition that the existing economic system was preserved . It was thought that this prevented a civil war of massive proportions.
This Historic Compromise (called by some a Faustian pact with the old regime) is at the root of the current problems of poverty and mass discontent in the country.

Zizek is sympathetic to Mandela's dilemma -- create a "new world"-- risk a civil war-- or "play the game" and abandon the "socialist perspective." [There is too much focus on Mandela here-- these decisions were made collectively by the leaders of all the major forces in the liberation movement.]  Zizek  asks a question that is still hotly debated today. Given the  constellation of forces facing the ANC et al on the assumption of power "was the move towards socialism a real option?" [Compromise was indeed necessary, but did the ANC concede too much?]

Seemingly inspired by Ayn Rand's Atlas Shrugged (a coming of age novel for adolescent libertarians), Zizek looks for "the grain of truth" in the "hymn to money" found in the novel: "Until and unless you discover that money is the root of all good, you ask for your own destruction. When money ceases to become the means by which men deal with one another, then men become the tools of other men. Blood, whips and guns or dollars. Take your choice-- there is no other." 

Not only is there no "grain of truth" in this "hymn" but when human beings only deal with each other on the basis of money we get all the horrors of blood, whips and guns that humans employ against each other in order to obtain and control more and more money (slavery, colonialism, imperialism, fraud-- you name it). It is not humans per se, of course, who engage in these horrors, but a special class of humans  (capitalists) created by the dominant economic system of monopoly capitalism. 

Not content with uncovering a grain of truth in Randism, Zizek imputes the same idea to Karl Marx-- a most un-Randian leap of fallaciousness. He asks if Marx's ideas about "the universe of commodities" were not similar to what Rand said in her hymn about money. After all Marx said under capitalism "relations between people assume the guise of relations among things."  This is a perfect example of a non sequitur and  I defy anyone to find the similarity between Marx's statements about the fetishism of commodities and Rand's view "that money is the root of all good."

Zizek's confusions continue. He thinks that the relations between people in the "market economy" can appear "as relations of mutually recognized freedom and equality." Maybe in the days of Adam Smith but I doubt even then. Donald Trump and his chauffeur hardly are equals or exercise the same amount of freedom. Mitt Romney thought 47 per cent of the American people were social parasites and he is an outstanding representative of the freedom and equally offered by the "market economy."  Most working people know exactly their relations to their bosses and it not only appears to be unequal and unfree (who gets the pink slip and loses unemployment insurance) it is unequal and unfree-- and all of Ayn Rand's baloney will never make it otherwise. 

It is obvious to any aware working person, that the blatant inequality and restrictions on human freedom under the "market economy"  lived and felt by millions of Greek workers, Spanish working people, and others in the EU and throughout the world, that  Zizek's view -- under capitalism "domination is no longer directly enacted and visible as such" -- is just nonsense. Such ruminations by a famous philosopher can only give philosophy a bad name.

While Zizek says that Ayn Rand's ideological claim (only the love of money can free people) is ridiculous, he persists in reminding us of the "moment of truth" it contains. The problem, he thinks, is Rand's "underlying premise" which is "that the only choice is between direct and indirect relations of domination and exploitation" and any alternative is "utopian." Ayn Rand has no such premise. She thinks in simple dichotomies. Unfettered dynamic capitalism and the love of money is GOOD and it is in no way, direct or indirect, involved in any relations of domination and exploitation-- it is the root of GOODNESS. On the other hand any efforts by liberals , socialists, misguided Catholic popes, or anybody else that impinges on this system of goodness is EVIL and a direct source domination and exploitation.

Zizek, however, thinks the "moment of truth" in Ayn Rand's theory of money is that it teaches us "the great lesson of state socialism." Despite Zizek's discovery of the Randian "moment of truth," I don't recommend using Atlas Shrugged as a prolegomena to any future socialism. This is the "truth" that Zizek has discovered.
If you abolish private property (God forbid!) and the market without concretely regulating production then you resuscitate "direct relations of servitude and domination." What does this mean? What "state socialist" country or countries can he be referring to that did not or do not have plans that regulate production? So called "state socialism" was famous for having "central planning" and tried to concretely regulate both production and distribution. As it stands Zizek's lesson is pointless.

He expands on his lesson. If we just abolish the market "without replacing it with a proper form of Communist organization of production and exchange, domination returns with a vengeance, and with it direct exploitation." This isn't very helpful. Communism doesn't spring full blown from the brow of Lenin the day after the revolution. What does Zizek think is the "proper form" of Communism. He gives us no clue in this article. I fear there is no lesson at all to be learned from Ayn Rand's "moment of truth." Certainly not Zizek's tautology that socialism fails to create communism if it doesn't create the proper form of communism.

Zizek now propounds a "general rule"-- it is really just his way of saying  the more things change the more they stay the same. It goes like this: when the people rise up against "an oppressive half-democratic regime" [what is a "half-democracy"-- people either have democratic rights or they don't] it's "easy" to get large demonstrations underway [I think that's what rising up means] and crowd pleasing slogans are devised (pro democracy, anti-corruption, etc) but after the "revolt succeeds" the people find themselves still oppressed as they were before except in a "new guise." 

This seems to me to be a strange concept of what a "successful" revolt is. Zizek seems to think it is some sort of spontaneous generation of of all things good and great for the people and if doesn't happen overnight, then the revolt has failed. His case studies are of the revolts "in the Middle East in 2011." He doesn't seem to understand that these are ongoing processes. The French Revolution didn't end with chopping off the King's head. The revolts may have been begun in the Middle East in 2011 but they are ongoing processes with ups and downs, advances and set backs and it much to early to decide which have failed and which have succeeded or even what "failure" or "success" will mean in the longue duree.

Zizek plogs along. The people do not succeed because they are prevented from seeing that their exploitation continues in the new guise after the revolution by the "ruling ideology" which blames them for their failure because they don't understand that they are not yet mature enough for full democracy [ and anyway, as Lady Thatcher  put it, 'there is no alternative" to capitalism (TINA)]. Zizek doesn't make sense here because he maintains both that the people don't realize the same old exploitation is going on and that they do realize it but are themselves blamed for it by the "ruling ideology." I think Zizek will find "the people" a bit more sophisticated and not as simple minded as he portrays them.

Zizek now explains how US foreign policy has developed a strategy that redirects the revolutionary energy of a popular revolt into political forms desired  by US imperialism (not a word used by Zizek in this article). The US did this in South Africa after the end of apartheid. If this is the case then the ANC, Mandela, the SACP, and entire liberation movement were puppets of US imperialist foreign policy. While he is at it, Zizek also says the same was done in the Philippines, post Marcos, in Indonesia, post Suharto, "and elsewhere." 

Now US foreign policy is indeed a formidable enemy of the people's of the world but the explanation for the problems of liberation movements in attaining their stated goals after the assumption of power can't simply be explained by saying they are victims of US foreign policy's elaborate "detailed strategy of how to exert damage control." In fact, as Wikileaks has shown, the people in charge of US foreign policy often don't know what they are doing, set in motion ridiculous plans, and often end making a mess out of whatever they had in mind to accomplish.

US foreign policy is by and large incompetent and its agents, diplomats, Congressmen and women, generals, cabinet members, and intelligence professionals can only foam at the mouth and yell "treason" when a young soldier, performing his duty to the Constitution of the the United States, Chelsea Manning, reveals some "secret" wires showing up the blunders and failures of the "professionals" in the state department and others and how they try to mislead the American people.  In any event,  Zizek says the big problem of the liberation movements is in finding a way to counteract US policies. As he puts it-- "how to move further from Mandela without becoming Mugabe." Perhaps a dialectical synthesis. Is  Zizek is waiting for Mangabe?

Finally, Zizek tells us what to do "to remain faithful to Mandela's legacy"-- a legacy he just told us was a failure and capitulation to imperialism. Zizek is just the philosopher of that kind of legacy. One he himself calls of "unfulfilled promises" and one that didn't "really disturb the global order of power."  We must forget the "celebratory crocodile tears" shed for Mandela and his leadership. I think that the people of South Africa and many of the dignitaries  (but not all) at his memorial and funeral would, and should be, outraged to be accused of faking their feelings for Mandela. We must instead concentrate on his failures. He ended his life as a "bitter old man" realizing his hero status "was the mask of a bitter defeat."  How does Zizek know this? He thinks, this is the type of philosopher he is, that "we can safely surmise" this to be the case because "of his doubtless moral and political greatness." What sense is there in saying there is political greatness in being a bitter old defeated man. Is the true founder of democratic South Africa then president F. W. de Klerk who is neither bitter nor considered a failure? Where is the moral greatness in bitterness?

The truth is that Mandela was a realist who made unavoidable compromises to free his people from apartheid, that he and his comrades in the ANC and SACP and the trade union movements forged a revolutionary struggle that toppled one of the most repressive political regimes in the world-- one backed by the post powerful imperialism in the world and its allies. This was not a failure to attain "socialism." Socialism cannot be imposed from above, it must be struggled for by working and oppressed people themselves and Mandela helped found the preconditions for that struggle.

The fact that the mighty of the world came to his memorial is testimony not that he failed "to disturb the global order of power" but that he profoundly shook it and they are eager to co-op his message and be identified with him because they know that all over the world at this very moment millions of oppressed people in both the centers of capitalist power and in the neocolonial fringes are beginning to rise up and demand their rights and that they have much to learn from the tactics of the South African liberation movement. Slavol Zizek's libels notwithstanding,  Nelson Mandela was a great revolutionary leader who freed his people from oppression and inspires masses  around  the world to fight for a better world-- he was the farthest it was possible to be from a "bitter old man."

Saturday, December 7, 2013

Women, Fertility, and the Rise of Modern Capitalism: Review


Thomas Riggins

This is a review of the above named article by Alberto Alesina (Harvard Economics Department) which appeared in Science 25 October 2013. It is an interesting article, not least because it is illustrative of Marx's view that bourgeois economics ceased to be a science after the time of David Ricardo and became merely an exercise in apologetics for capitalism but also because it attempts to answer the question "How did the Black Plague change work and family opportunities for women" as relates to the rise of capitalism.

This is a short summary overview of the article in six sections:

1.  Income per capita (total economic output divided by total population) equals the wealth of a nation. The wealth increases only if the the output increases faster than the population. Historically the relation of output and the population was stable, resulting in social immobility. Two revolutions changed this. First, the "Malthusian" [?] revolution due to the Black Death]-- slowed down population growth. Second, the Industrial Revolution increased output. The first revolution was a precondition for the second because it allowed income to go above subsistence level creating a demand for goods and technology that "pulled away" from agriculture creating the conditions for the birth of modern capitalism. An important consequence of all this was the increase in the number of women in the work force. [This section puts forth the thesis of Alesina's article. Now we must see how he fleshes it out.]

2.  The author now states Malthus [1766-1834] made a great discovery--i.e., "population growth is continuously held in check by the resources available to sustain it"-- and this hinders social progress. Two observations here: 1) this common sense self-evident observation was hardly unique to Malthus and is not what he is famous for (which is the preposterous unscientific observation that food supply increases arithmetically and population geometrically); 2) a stable population does not of necessity prevent social progress. The article next informs us that Europe had  stable living standards until struck by the Black Death (bubonic plague) in 1348-1350 when a third of the population or more died. The result of the die off was a labor shortage and a surplus of land to be worked. This caused wages to go up, especially in agriculture,  and opened opportunities for women to work in the fields, giving them less time for child care, thus leading to a rise in the age of marriage and a lowering of the fertility rate and a slowing of future population growth. I am confused about the "rise of wages" because most agricultural workers in the 14th century were bound serfs not wage workers. Craftsmen did make more money and workers in towns and cities a well but the serfs benefited by being able to demand a greater share of the product rather than by "wages" per se, although in some areas a minority of paid agricultural workers did exist. In fact it was an attempt to suppress gains by the serfs and peasants that lead to the peasant wars which broke out after the plague years.

There is no reason to refer to this phenomenon as a "Malthusian" revolution.  In the first place four hundred years separate Malthus from the Black Death and in the second place Malthus is not really entitled to have anything named after him as he was not an original thinker and plagiarized all his major ideas fro earlier writers and put them in the service of the landowning class as opposed to the up and coming bourgeoisie of his day and the working people. Marx points out (Theories of Surplus Value, Vol.2) that Malthus got his ideas mostly from a little known writer on agriculture and economics, James Anderson (1739-1808). Marx wrote, "Malthus used the Andersonian  theory of rent to give his population law, for the first time, both an economic and a real (natural-historical) basis, while the nonsense about geometrical and arithmetical progression borrowed from earlier writers, was a purely imaginary hypothesis (chapter ix, sec. 1)."  Malthus never credited those authors from whom he copied his ideas. That he is still taken seriously by some modern economists is evidence of the ideological rather than scientific role of the
discipline under capitalism.

3. The article also points out that the need for child labor increased due to the shortage of agricultural labor and this implies an incentive for an increase in fertility-- counteracting the decrease in fertility implied by women working in the fields and thus unavailable for child care. Almost all the sentences used by the author to advance his ideas are qualified and speculative: e.g. higher wages "could have" effected fertility and "might have" increased fertility. These factors "may have played out" in different ways in different parts of Europe. A useful theory cannot be
based on "could have" and "may have" speculations. He now wants to ask "why"
wages and fertility "could have" been different in different parts of Europe-- particularly the difference between North Western and South Eastern Europe.

4. His answer is also speculative as he calls it "one possibility." That is,  the (non-existent) "Malthusian" revolution brought about income growth before the Industrial revolution. This is because after the Black Death  fertility in South Eastern Europe returned to pre-plague levels but increased "substantially" in North Western Europe. "Not surprisingly, this part of Europe led the spectacular rise of modern capitalism." The "Not surprisingly"  is begging the question. Growth in fertility was an important factor in the growth of capitalism. Evidence: there was a growth of fertility in North Western Europe and then there was the rise of capitalism. This is evidence of a correlation not a cause.

5. Regardless, the author thinks that the Black Death and the "Malthusian" revolution were only two factors in the rise of capitalism in North Western Europe. He says "one possibility" for another, and the tipping factor, was the Protestant Revolution.

6.  Regarding the Protestant Revolution-- i.e., the Reformation, the author, who mentions Max Weber, credits Lutheranism with introducing the ideas of an accumulation of human capital. The concept of "human capital" is not worked out. Capital accumulation (money for investment in commerce)  however, based on frugality and hard work by  individuals  which implies that one has been chosen as one of God's elect was a feature of Protestantism.  Actually this so called "Protestant Ethic" as a factor in the rise of capitalism was credited by Weber to the influence of Calvinism not Lutheranism (which he took a dim view of). The author suggests  that perhaps the influence of the Reformation on the development of capitalism was not due to the religious doctrine as such but due to the emphasis on economic growth that Protestantism developed. A strange suggestion since Weber's point was that the economic emphasis was a deduction from Calvinist religious principals. Calvinism was based on a doctrine of predestination and economic success was evidence (but not proof} that one was predestined to be one of the elect (who gets to Heaven)-- the more economically and socially successful one was the better the evidence of future salvation.

I must conclude that this article doesn't provide any evidence whatsoever for any of its major contentions. It doesn't even mention the role of the discovery of the New World and the wealth that flooded Europe as a result of the dispossession of the native populations, nor the enclosure movements by which peasants were dispossessed of the commons or driven off their land which was then developed as private property while the dispossessed were forced to become laborers working for others on the pain of imprisonment or death. The article is highly speculative and inspired by discredited  and unscientific notions of a nonexistent "Malthusian" revolution and leaves us as much in the dark after reading it as before as to the actual influence of women and their fertility on the rise of modern capitalism.