The American Bear

Sunshine/Lollipops

Why socialize finance? | Matt Bruenig

For whatever reason, the dominant left-intellectual gripe with capitalism these days finds its origins in Marx’s theory of alienation. That is not to say all the criticisms come with cites to the Economic and Philosophical Manuscripts of 1844, but that is the intellectual tradition those criticisms are working within. In that tradition, the terribleness of capitalism is manifested in the way that wage labor causes various sorts of alienation and commodification. Among other things, workers have little control over their productive energies or the resulting product (bosses and owners control both). Workers also find themselves estranged from their co-workers and everyone else for that matter as competition puts their interests at odds with everyone else. This capitalist reality generates terrible psychic harm and pain because it undermines humanity’s natural tendency towards community and creativity.

Although this is an important tradition in the history of anti-capitalism, it is not the only one. Marx himself seemed far more interested in another critique of capitalism that focused on the unearned incomes of capitalists. In very simple terms, capitalism enables owners of enterprises to capture income that they do not work for.

The modern stockholder is a fantastic example of such capturing. The stockholder buys some equity in a company, has absolutely no role in the company, and then sells the equity down the line at a gain (and in the meantime receives dividends). That stockholder did no work at all to generate that gain or the dividends. Workers in the firm did all of the work, but they did not receive all of the gain. So not only does the stockholder capture income that she did not earn, but the workers in the company are deprived of income that they did earn. That is classic exploitation.

Outrage at unearned income is the classic domain of theories of desert. Under desert theory, individuals are owed compensation equal to their economic contribution, nothing more and nothing less. This theory has its problems, but it has a massive intellectual pedigree, even on the left. For a modern take on it, Gar Alperovitz and Lew Daly cannot be beaten.

Capitalist systems are riddled with payouts that have nothing to do with economic contribution. Early theorists focused on land rents as a troubling type of unearned income. In Wealth of Nations, Adam Smith noted that “[a]s soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed and demand a rent even for its natural produce.” John Stuart Mill, noted market socialist, said it best:

Suppose that there is a kind of income which constantly tends to increase, without any exertion or sacrifice on the part of the owners: those owners constituting a class in the community, whom the natural course of things progressively enriches, consistently with complete passiveness on their own part. In such a case it would be no violation of the principles on which private property is grounded, if the state should appropriate this increase of wealth, or part of it, as it arises. This would not properly be taking anything from anybody; it would merely be applying an accession of wealth, created by circumstances, to the benefit of society, instead of allowing it to become an unearned appendage to the riches of a particular class.

It is under this desert theory tradition — which Marx’s theory of exploitation makes him a part of — that socialization of finance finds its strongest justification. Financial wealth delivers passive incomes to owners through no exertion of their own. Capturing those financial gains and distributing them socially corrects that injustice. It eliminates the technical exploitation that Marx fixated on in Capital. All else equal, that seems like a very commendable achievement to me at least.

Although socialization of finance is most supported by the desert tradition, it can do things which should appeal to other traditions as well. Among other things, it provides a revenue stream that can be used to pursue egalitarian goals (through cash transfers for instance), and even worker empowerment goals (through basic incomes for instance). Additionally, and perhaps more importantly, socialization of finance is completely compatible and can exist alongside other sorts of left programs. It may not fully solve alienation and commodification problems (if indeed you think they exist), but it certainly does not preclude them from being solved.

How the Left has Won (2) | Jacobin

Individualism isn’t the antithesis of community or socialism. To think so is to assume that attaining autonomy as an individual requires the denial of all tradition and solidarity, whether inherited or invented, or it is to assume that economic self-assertion through liberty of contract is the path to genuine selfhood. We know better – we know without consulting Aristotle that selfhood is a social construction – but we keep claiming that our interests as individuals are by definition in conflict with larger public goods like social mobility and equal access to justice and opportunity.

We keep urging our fellow Americans to “rise above” a selfish attachment to their own little fiefdoms, whether these appear as neighborhoods or jobs, and their cherished consumer goods. In doing so, we’re asking them to give up their local knowledge, livelihoods, and identities on behalf of an unknown future, a mere abstraction, a canvas stretched to accommodate only the beautiful souls among us: we’re asking them to get religion. Either that or we’ve acceded to the anti-American fallacy cooked up by the neoclassical economists who decided in the 1950s that liberty and equality, or individualism and solidarity – like capitalism and socialism – are the goals of a zero-sum game.

By now we know what the founders did: that equality is the enabling condition of liberty, and vice versa. There were two “cardinal objects of Government,” as James Madison put it to his friend and pupil Thomas Jefferson in 1787: “the rights of persons and the rights of property.” Each constitutional purpose permitted the other, not as an “allowance” but rather as a premise. One is not the price of the other, as in a cost imposed on and subtracted from the benefit of the other. Instead, liberty for all has been enhanced by our belated approach to equality, our better approximations of a more perfect union; for example, by the struggles and victories of the civil rights movement, the women’s movement, and the gay rights movement. [++]

[Our economy now], which I would summarize as the decomposition of capitalism, is a situation in which the extraction of surplus value from labor by capital has lost its investment function, and the production of value by labor has lost its income function. In short, capitalism has stopped making moral sense because it has stopped making economic sense. It’s not a technical issue. Capitalists and their political functionaries continue to extract surplus value from labor however they can – these days by fierce assertion of their prerogatives, as if they’re Charles I defending the divine right of kings against a dubious Parliament, as if the rights of property as such are at stake – but the profits that result have no purpose, no outlet, no investment function. Growth will happen with or without them, whether they’re invested in goods production or not, and so they pile up, waiting for another bubble 
to inflate. James Livingston

How the Left has Won | Jacobin

When we think about the transition from feudalism to capitalism, we take the long view – we scan the four centuries from 1400 to 1800, looking for signs of fundamental but incremental change. To be sure, we assume that the great bourgeois revolutions of the seventeeth, eighteenth, and nineteenth centuries were both symptoms and causes of this transition; in that sense, we proceed in our thinking as if capitalism were created by social movements, political activism, ideological extremism. Still, we know these early modern movements can’t be compared to the communist parties that created state socialism in twentieth-century Russia, China, and Cuba, because in these more recent instances, self-conscious revolutionaries organized workers and peasants to overthrow capitalism and create socialism.

In the mid seventeeth century, John Milton, John Lilburn, and Gerrard Winstanley clearly understood that they were overthrowing something, but they didn’t know they were creating the conditions of capitalism; neither did Thomas Paine a century later, as he made his way from the American to the French Revolution, from Common Sense to The Rights of Man. Not even Maximilien Robespierre, the mastermind of the Terror, was prophet enough to see this improbable future. And when Theodore Weld, Angelina Grimke, Frederick Douglass, and Abraham Lincoln set out to overthrow slavery, they didn’t know they were making “The Last Capitalist Revolution,” as Barrington Moore, Jr. called it in Social Origins of Dictatorship and Democracy (1966).

In short, capitalism was the unintended consequence of bourgeois revolutions, whereas socialism has been the avowed purpose, or at least a crucial component, of every revolution since 1911. This difference has become so important that when we think about the transition from capitalism to socialism, we take the short view: we look for ideological extremes, social movements, vanguard parties, self-conscious revolutionaries, radical dissenters, armed struggles, extra-legal methods, political convulsions – as if the coming of socialism requires the abolition of capitalism by cataclysm, by insurgent, militant mass movements dedicated to that purpose. As a result, we keep asking Werner Sombart’s leading question, “Why Is There No Socialism in the United States?” And we keep answering defensively, on our way to an apology. [read]

The power of Cuba's free healthcare (2) | Belén Fernández

A December 2010 article by Nina Lakhani in the British Independent describes the domestic effects of Cuba’s “prevention-focused holistic model” of health care:

“This model has helped Cuba to achieve some of the world’s most enviable health improvements, despite spending only $400 (£260) per person last year compared with $3,000 (£1,950) in the UK and $7,500 (£4,900) in the US, according to Organisation for Economic Co-operation and Development figures.

Infant mortality rates, one of the most reliable measures of a nation’s healthcare, are 4.8 per 1,000 live births - comparable with Britain and lower than the US. Only 5 per cent of babies are born with a low birth weight, a crucial factor in long-term health, and maternal mortality is the lowest in Latin America, World Health Organisation figures show”.

Lakhani also notes that “[a] third of Cuba’s 75,000 doctors, along with 10,000 other health workers, are currently working in 77 poor countries” but that “this still leaves one doctor for every 220 people at home, one of the highest ratios in the world”.

Former World Health Organisation director-general Halfdan Mahler has declared that “[n]o other country has been as consistent in taking measures towards achieving the goal of ‘Health for All’ as Cuba”, while the New York Times has acknowledged that “many expatriate [Cuban] doctors say their dealings with patients in Cuba were more humane and less rushed than they are in the United States”.

Given this reality, it is impossible not to bash one’s head against the wall when confronted with US proponents of the notion that health care as a right rather than a commodity constitutes an unparalleled horror that must be combated at all cost. The danger, of course, is that human health will one day supersede corporate health in importance, an eventuality that has most recently been staved off with the passage of the Affordable Care Act - summarised as follows by Harvard Medical School’s Marcia Angell in The New York Review of Books:

“[The act] requires people to buy a commercial product from investor-owned companies at whatever price the companies choose to charge. In short, people are required to contribute to the profits and corporate salaries and marketing costs of companies like WellPoint and UnitedHealthCare”.

[Author of Revolutionary Doctors, Steve] Brouwer meanwhile concludes with regard to the US health care system:

“The fact that this very wealthy country is willing to deny the opportunities that could effectively deliver health care to its own people, while also sabotaging the efforts of poorer nations to build new kinds of public primary care medical systems, is one of the great scandals of twenty-first-century capitalism”.

Though it is crucial to avoid romanticising Cuban and Venezuelan political systems, which naturally contain their own repressive aspects, it’s totally healthy to romanticise what Brouwer describes as Che’s “original aspiration - combining the humanitarian mission of medicine with the creation of a just society”. [++]

instagramsci:

“The materialist conception of history starts from the proposition that the production of the means to support human life and, next to production, the exchange of things produced, is the basis of all social structure; that in every society that has appeared in history, the manner in which wealth is distributed and society divided into classes or orders is dependent upon what is produced, how it is produced, and how the products are exchanged. From this point of view, the final causes of all social changes and political revolutions are to be sought, not in men’s brains, not in men’s better insights into eternal truth and justice, but in changes in the modes of production and exchange. They are to be sought, not in the philosophy, but in the economics of each particular epoch. The growing perception that existing social institutions are unreasonable and unjust, that reason has become unreason, and right wrong, is only proof that in the modes of production and exchange changes have silently taken place with which the social order, adapted to earlier economic conditions, is no longer in keeping. From this it also follows that the means of getting rid of the incongruities that have been brought to light must also be present, in a more or less developed condition, within the changed modes of production themselves. These means are not to be invented by deduction from fundamental principles, but are to be discovered in the stubborn facts of the existing system of production.”

— Fredrich Engels, Socialism:Utopian and Scientific (1880)

(Source: wilnyc, via basedlenin-deactivated20120831)

The spark ignites in the action - the philosophy of praxis in the thought of Rosa Luxemburg | Michael Löwy

[Luxemburg’s] writings are traversed by a tension between historical determinism - the inevitability of the collapse of capitalism - and the voluntarism of emancipatory action. That applies in particular to her early works (before 1914). Reform or Revolution (1899), the book thanks to which she became known in the German and international workers’ movement, is an obvious example of this ambivalence. Against Bernstein, she proclaims that the evolution of capitalism necessarily leads towards the collapse (Zusammenbruch) of the system, and that this collapse is the historical road which leads to the realization of socialism. This amounts, in the final analysis, to a socialist variant of the ideology of inevitable progress which has dominated Western thought since the Enlightenment. What saves her argument from a fatalistic economism is the revolutionary pedagogy of action: “in the course of the long and stubborn struggles, the proletariat will acquire the degree of political maturity permitting it to obtain in time a definitive victory of the revolution.”

This dialectical conception of education through struggle is also one of the main axes of her polemic with Lenin in 1904: “The proletarian army is recruited and becomes aware of its objectives in the course of the struggle itself. The activity of the party organization, the growth of the proletarians’ awareness of the objectives of the struggle and the struggle itself, are not different things separated chronologically and mechanically. They are only different aspects of the same struggle”.

Of course, recognizes Rosa Luxemburg, the class can be mistaken during this combat, but, in the final analysis, “Historically, the errors committed by a truly revolutionary movement are infinitely more fruitful than the infallibility of the cleverest Central Committee”. The self-emancipation of the oppressed implies the self-transformation of the revolutionary class through its practical experience; this, in its turn, produces not only consciousness – a traditional theme of Marxism - but also will: “The international movement of the proletariat toward its complete emancipation is a process peculiar in the following respect. For the first time in the history of civilization, the people are expressing their will consciously and in opposition to all ruling classes. (…) Now the mass can only acquire and strengthen this will in the course of day-to-day struggle against the existing social order – that is, within the limits of capitalist society.”

In Soviet Union, Optimization Problem Solves You

thenoobyorker:

"Marx had drawn a nightmare picture of what happened to human life under capitalism, when everything was produced only in order to be exchanged; when true qualities and uses dropped away, and the human power of making and doing itself became only an object to be traded. Then the makers and the things made turned alike into commodities, and the motion of society turned into a kind of zombie dance, a grim cavorting whirl in which objects and people blurred together till the objects were half alive and the people were half dead. Stock-market prices acted back upon the world as if they were independent powers, requiring factories to be opened or closed, real human beings to work or rest, hurry or dawdle; and they, having given the transfusion that made the stock prices come alive, felt their flesh go cold and impersonal on them, mere mechanisms for chunking out the man-hours. Living money and dying humans, metal as tender as skin and skin as hard as metal, taking hands, and dancing round, and round, and round, with no way ever of stopping; the quickened and the deadened, whirling on. … And what would be the alternative? The consciously arranged alternative? A dance of another nature, Emil presumed. A dance to the music of use, where every step fulfilled some real need, did some tangible good, and no matter how fast the dancers spun, they moved easily, because they moved to a human measure, intelligible to all, chosen by all."

There is a fundamental level at which Marx’s nightmare vision is right: capitalism, the market system, whatever you want to call it, is a product of humanity, but each and every one of us confronts it as an autonomous and deeply alien force. Its ends, to the limited and debatable extent that it can even be understood as having them, are simply inhuman. The ideology of the market tell us that we face not something inhuman but superhuman, tells us to embrace our inner zombie cyborg and loose ourselves in the dance. One doesn’t know whether to laugh or cry or running screaming.

— Cosma. “In Soviet Union, Optimization Problem Solves You”. Crooked Timber. 30 May 2012. Web. 5 June 2012. [source]

(via genericlatino)

The American People will take Socialism, but they won’t take the label. I certainly proved it in the case of EPIC. Running on the Socialist ticket I got 60,000 votes, and running on the slogan to ‘End Poverty in California’ I got 879,000. I think we simply have to recognize the fact that our enemies have succeeded in spreading the Big Lie. There is no use attacking it by a front attack, it is much better to out-flank them. Upton Sinclair (via jonathan-cunningham)

John Rees on democracy and the age of mass movements | Counterfire

Why has democracy become such a trenchant demand amongst new movements and how should the left understand and relate to this impulse?

The demand arises because neo-liberalism and neo-conservatism must necessarily strip out even those limited elements of democratic control (as well as welfare provision and trade union rights) that were granted in the long post war boom. The Arab revolutions demand real democracy, but so do Greek rioters and the global occupy movement. We should identify with this impulse completely, but also explain that democracy and capitalism are fundamentally incompatible. Dictatorship where you work (which is what capitalism is) and democracy outside work will always be in conflict. If we want real democracy it must include economic democracy. Political democracy plus economic democracy equals socialism. [++]

Joseph Hansen: Hayek Pleads for Capitalism (June 1945)

[Friedrich] Hayek, of course, is not original in his logic. He simply states more baldly the assumption at the bottom of the whole school which maintains Nazism and Marxism are twins; that Nazi Germany and Soviet Russia are species of one genus; that Stalinists and Nazis are both representatives of a new class hitherto unknown and unforeseen in history. Hayek’s method is characteristic of the petty bourgeois approach to this subject. Its appeal to petty bourgeois renegades from socialism has been demonstrated again and again, one of the most prominent recent instances being that of James Burnham, whom Hayek mentions favorably in a foot note.

Where his purposes require it, our bourgeois pundit not only amalgamates the unamalgamable, he divides the indivisible. This gives his logic a symmetry that should please the petty bourgeois eye. The petty bourgeois renegades from socialism have long pondered the question of means and ends in order to construct a suitable rationalization to cover their base retreat. Hayek does not overlook this powerful instrument of bourgeois propaganda. “All the consequences with which we shall be concerned in this book,” he declares, “follow from the methods of collectivism irrespective of the ends for which they are used.” Thus does Hayek drive an axe between means and ends. In dialectic logic on the contrary, means and ends reciprocate, are in mutual dependence. A revolutionary takes as his end the building of a political party of the working class so that it can become the means to reach a new end, the dictatorship of the proletariat, which in turn becomes the means to inaugurate the socialist society of peace and plenty. Hayek’s logic, however, makes an arbitrary abstraction of “means,” amputates it from “ends” and opens it up like an empty sack in which he can place whatever content he requires to “prove” his thesis.

Only a soul-sick petty bourgeois, unable to think clearly, could be taken in by logic as “remorseless” as this. But it is precisely such individuals Hayek addresses, and the efficacy of arbitrarily separating ends from means in driving the petty bourgeoisie from Marxism has been demonstrated many times over. I do not know of an exception among the renegades from Marxism who has not passed through the stage of sweating over “means and ends.” It is now a standardized argument in bourgeois propaganda. [++]

Joseph Hansen | Hayek Pleads for Capitalism (June 1945)

An excellent (highly recommended), old-tymie takedown of libertarian hero, Friedrich Hayek:

[In Road to Serfdom, Friedrich] Hayek deals quite concretely with the dangers, terrors and horrors of socialist means. Among his major exhibits is planning. This spokesman of the capitalist order holds that planning leads to the very opposite of what it sets out to accomplish. Instead of a means of achieving greater freedom, planning in the eyes of the professor becomes the means leading to slavery and chaos. Under the fascists freedom was lost, but the fascists are only one species of collectivism of which the socialists are another, therefore freedom would be lost under the socialists just as much as under the fascists. Or to drop more deeply with Hayek into the logical abyss: Since ends (by this Hayek implies good or bad intentions) have nothing to do with what happens from the use of certain means, and since planning is inherently a bad means, no matter who uses it evil results will follow; but planning is characteristic of socialism, therefore …

The facts are so well known one is astonished that even the most delirious petty bourgeois could bring himself to accept such “reasoning.” The fascists in both Germany and Italy used “planning” to crush the working class, drive down the standard of living, intensify exploitation and unite the capitalist class in a bid for world power through imperialist war. This “end” had nothing to do with good or bad intentions. The capitalist class utilized fascist “planning” in order to preserve its rule.

Socialist planning, on the other hand, begins with the expropriation of capitalist property, the expansion of the productive machinery, the raising of the standard of living and the balancing of the economy through correlation of its various sections by means of a general plan. Planning in this case too has nothing to do with good or bad intentions. It is the means the working class must utilize to preserve itself from utter disintegration. At the same time it becomes the means to end the class struggle. Under fascism the class struggle continues; under socialism the classes eventually disappear.

It is not necessary to be a Marxist to see the fallacy in Hayek’s analysis of planning. Anyone who understands the class struggle, as do the capitalists, can see that the result of planning is not implicit in planning in and of itself as a means, but is implicit in what class does the “planning” and for what end.

Read the whole thing

(h/t arielnietzsche)