Published online 13 November 2011.
A good friend of mine recently told me she was going to stop discussing “opposing capitalism” to her local Occupy because of the ferocity of the response she’s getting from defenders of the capitalist system there. Now, to me it seems rather bizarre that participants in an Occupy would defend the capitalist system. Capitalism, in fact, brought us to this point — it, and not the Occupy movement, divided society into the 1% who have won and the 99% who have lost.
Now, to be sure, plenty of people at Occupy LA, where I’ve been, support capitalism. Certainly the Paulists, who have a significant force there, do, as well as the liberals, whose thinking was apparently behind the Media Committee’s decision to create “Meet the Liberals Day.” This is, however, a reflection of the state of thinking in this era, and not of the state of finance, which is as I said it was.
Here is my list of reasons for why people defend capitalism. Now, to a certain extent I have to imagine this list, because I can’t really claim to have seen genuine debate about the merits of the capitalist system. Moreover, my stance isn’t to argue from the premise that capitalism is bad. Where I stand with relation to capitalism will develop below the bar. At any rate, here is why I think people defend capitalism:
1) They associate it with a career. Small business owners no doubt imagine that they do good by running small businesses, and they associate their activity with the functioning of the capitalist system. Rein in the big businesses, they assume, and capitalism will flourish.
2) They associate the harm done to the world with “bad business.” The big businesses do bad business because they are able to defy regulatory frameworks by moving industries and jobs to other countries than the US, by gaming the financial system, and through fraud (most specifically the mortgage fraud of recent times).
3) They think our society needs the dynamism of the capitalist system. The “expansion of trade,” it is argued, is good for world-society because it promotes the production of good and useful things.
4) They still believe in the “rising tide lifts all boats” analogy. The idea behind this analogy is that, if capitalist business continues to produce good things, eventually (and somehow) these good things will “trickle down” to everyone.
So this is why I think many people defend capitalism. Do I think they’re stupid to do so? No. Do I think they’re thinking about how the future of capitalism will turn out? No, but does anyone really think about the future these days?
Now, I’m not going to rebut any of these arguments, because for the most part I’m not in the “anticapitalism” business anymore. Mostly, these days, I view myself as one of the 99%, and thus of the Occupy movement. I don’t think, moreover, that the “social justice” aim, pursued by itself, leads all participants toward a natural anticapitalism – I do not think there is any inherent contradiction between the appropriation of a surplus by even a small elite of capitalist owners, and the provision of a minimum living standard for all. (Oh, sure, a world dominated bysocial democracy is not going to happen, for the reasons detailed by Marx at the end of volume 1 of Capital — the “industrial reserve army” keeps wages down and profits up — but there are worse things than social democracy, so that’s not going to keep anyone from trying.)
Rather, I think that if we pursue each of these arguments “upward” (toward more holistic social thinking), they will lead the defenders of the capitalist system toward one overarching argument:
5) The “there is no alternative” argument. Now, this has been used for significant right-wing purposes, but I do not think that its usage is by any means restricted to neoliberals. Rather, in its politest format it is argued that the task of “coordinating social actors” is best conducted through “steering systems’ such as money and power, and that in this regard capitalist democracy has shown its superiority over all alternatives.
Among the nice guys, we can find this argument, specifically, in Jurgen Habermas‘s (1981) classic Theory of Communicative Action, specifically as regards the section in Part 2 on Marx. To greatly oversimplify Habermas’s argument, he asserts that we need to use a two-fold approach to the understanding of society. One approach involves the understanding of how society organizes its affairs through the creation of systems, and so you have the nation-state system, the capitalist system, and so on. The other approach involves understanding how people “rationalize” their affairs through discussion and dialogue, and so you have what Habermas calls the “rationalization of the lifeworld.” By understanding the world in ever-more-rational terms through the productive use of dialogue, Habermas implied, we develop the ability to improve the world.
Habermas’s argument in Theory of Communicative Action (greatly simplified, of course) is that the “rationalization of the lifeworld” can never really replace the capitalist system, because world-society is too big and the world is too complex. So, he thinks, you need “steering systems” to co-ordinate between great masses of economic actors. And for this purpose the capitalist system has shown its ability to outlast the others, with government a check on the excesses of business.
Let’s remember, here, what it means to say that there is no alternative. The capitalist system may in fact be unjust by this reckoning, but it’s the best we can do, and so real grownups believe in mitigating capitalist democracy and making it less unjust. By this reckoning the anticapitalists must go sit at the kid’s table.
At this point I would like to suggest that the capitalist system is not all that stable, and that its adherents’ faith in its longevity is misplaced. The point is not that if we all try really hard we can bring down the capitalist system. There are too few anticapitalists to accomplish this task anyway, and as it stands they aren’t going to persuade the rest of the public (especially here in the US) to become anticapitalists anyway. Rather, the “rationalization of the lifeworld” will at some point in the next few decades have to create an alternative to the capitalist system, whether the public wants such an alternative or not.
Now, the standard marxist criticism of the Powers That Be in academic (capitalist) economics is that the capitalist system is prone to “crisis.” Since capitalism experiences periodic crises, we are led to reason, the idea of a capitalist system in a stable equilibrium is rubbish, nonsense, bullshit. Capitalism is unstable and who knows it might die someday. Moreover, we are told, if we all try really hard we can make something good of the capitalist system in crisis — like form a social movement to agitate against social injustice.
The problem with all of this reasoning is that a “crisis” can mean a number of things. The Great Depression, the economic downturn between 1929 and 1932, definitely counts as a crisis. The Great Depression, however, will be remembered by historians as a crisis which paved the way for the Golden Age of Capitalism, between 1948 and 1971. Because of the Great Depression, the economic thinking of John Maynard Keynes became pre-eminent as an intellectual vehicle for the various movements, in the US, Europe and Japan, to create and sustain the Golden Age of Capitalism.
At this point in my discussion the essays of Jason W. Moore are really helpful in clarifying the idea of “crisis” that we find in the writings of the marxists. The crisis that was the Great Depression was what Moore would call a “developmental crisis.” Developmental crises end with the reformation of the capitalist system to overcome the crisis, stronger than ever. This is precisely what happened with the Great Depression — war cleared the grounds of the old capitalist system for a new capitalist system, more robust than the old one.
Do we really imagine that such a crisis is occurring now? Three things indicate it isn’t:
1) The end of the “Four Cheaps” as Moore calls them: food, energy, labor, and resources. Technical advances may make it easier for capitalists to make more money from money — but they haven’t resulted in a new era of cheap natural resources. This is really Moore’s argument, and reading his essays will draw it out. I think, though, that the most persuasive evidence of this is in the fact that the search for “alternative energy” has led to the discovery of quite a few energy sources, but that one can see how they still aren’t as cheap as fossil fuels.
2) The shrinking space for expansion of the capitalist system. In previous eras there was always a frontier — a place where capitalist governments could impose commodity exchange, the conditions for the building of factories, energy production sites and other accoutrements of industrialism, markets, and so on. Those spaces are becoming significantly more difficult to find.
3) The self-devouring nature of the predominant mechanisms for profit in this era. We currently have a system in which profits are “made” by generating a derivatives market of $1.2 quadrillion, and then the 1% still rakes it in it in even if the US government only puts out a mere $12.8 trillion in guarantees. The science of profit, then, has advanced so far in this era that production has become unnecessary to profit. One can see, then, a point at which Ponzi schemes will completely lay waste to the system as a whole.
Thus it’s rather unlikely that this particular crisis will be a developmental crisis. The coming crash of the Eurozone is unlikely to be followed-up by some superior form of capitalist organization, not with “Peak Oil” and global warming on the immediate horizon. Rather, the crash of the capitalist system is likely to be replaced by more and more parodic attempts at “capitalism,” all of which will use government to prop up the power of the 1% while the 99% of the public at the bottom of the food chain attempts to secure their collective survival. We are headed, in short, for an interim. After the interim, world society will be something different — but what that will be is today hard to say. Jason W. Moore suggests that this could be an “epochal crisis,” a crisis which will result in the end of capitalism as a whole. Gopal Balakrishnan argues:
We are entering into a period of inconclusive struggles between a weakened capitalism and dispersed agencies of opposition, within delegitimated and insolvent political orders. The end of history could be thought to begin when no project of global scope is left standing, and a new kind of ‘worldlessness’ and drift begins.
In this context, I don’t really see much of a reason for arguing for “anticapitalism” right now. In the coming decades, opinion will be decided more by the (degenerating) state of the politico-economic base than by the superstructure of ideological opinion. A rigorous historical materialism would demand a rigorous postcapitalism, an anticipation of the state of (historical) reality to come.This is a time for revolt, indeed: but it is also a time for learning — of opening one’s eyes and ears and getting a proper assessment of the situation while at the same time we attempt to build the world after capitalism. Obviously the moral underpinnings of socialism/ anarchism will still be useful — humanism, solidarity, sharing, friendship, love — though we may find them in the most unexpected places.