Capitalism and its discontents

anti-capitalist protest

Two observations kept intruding on me as I read Deirdre McCloskey’s magisterial take-down of Thomas Picketty’s Capital in the Twenty-First Century.

The first is how fortunate we are.  Americans today stand on the crest of that colossal upsurge of wealth McCloskey calls the Great Enrichment, which has made us 900 times richer than our forebears in 1800.  This is unprecedented in human history – and it doesn’t even account for qualitative improvements, like streaming video on a wall-sized, high-def TV or my ability to communicate through this blog.

The second is that most people seem to feel the opposite of fortunate.  They are unhappy, they are disgusted with the system that has placed all that wealth at their feet, they want more, they want less, they want different.  From the airless heights of the French intelligentsia, where Picketty hovers effortlessly, to the streets of Ferguson, Missouri, where mobs are burning down neighborhood stores, everyone is in a mood of repudiation, everyone condemns, attacks, secedes.

This too is unprecedented in history.  Malcontents in the much poorer societies of the past rarely blamed the system.  They never proposed alternatives, probably because they were unable to conceive of any.  Spartacus aimed to lead his army of escaped slaves out of the Roman Empire.  He had no interest in establishing a Freedmen’s Socialist Republic.  The great peasant revolts of the Middle Ages were spasms of violence and destruction.  The peasants craved revenge, not a new order.  Wat Tyler, closest thing to a political radical in the period, became enraged during negotiations, attacked the Mayor of London with a dagger, and was cut down by the king’s men.

Anger drove the underclass to insurrection – but pure negation isn’t much of a program.  Once the spasm was spent, the rebels had nowhere to go, and they were exterminated in every instance.

The possibility of revolution – of an alternate system, conceived in somebody’s head, imposed on the real world – appeared at a fraught moment in time:  the intersection of Enlightenment faith in the rational reordering of society with Romantic contempt for human life in the pursuit of noble ideals.  By 1848, Marx could write that the “specter of communism” haunted Europe.  The substance of the apparition was mostly dreamed up by Marx himself, but in 1917 it materialized in Russia and began a career of devouring humanity that is not quite over yet.

Communism wasn’t the only phantom at the capitalist feast.  Fascism, National Socialism, anarchism, syndicalism:  all shared a visceral loathing of “bourgeois” existence and the wish to replace it with a more heroic alternative.  The poor and the working classes did not participate in this system-making, any more than had the slaves or the serfs before them.  Inventing anti-capitalist systems was a bourgeois sport.

Marx came from a rabbinical family.  Lenin’s people belonged to the bureaucratic elite.  Mussolini’s father was a well-educated blacksmith, his mother a teacher.  Hitler rose out of the Austrian petite bourgeoisie, Stalin out of the Georgian equivalent.  Mao was the son of a wealthy farmer.  The same was true of Pol Pot, who studied radio electronics in Paris.  These were not the wretched and exploited, desperate for any alternative to their miserable lives.  They were all creatures of the Great Enrichment.

The most implacable enemies of capitalism were the pampered children of capitalism.  It would be a kindness to say that they turned against the system only because they were for a wonderful, if imaginary, ideal of society.  But we know this to be false.  In this late hour of our late age, we know revolution to be a fever dream.  The specter of communism, as an alternative system, was exorcised in 1989 and 1991.  By then, all other alternatives lay in the dust, defeated.  Capitalism has stood unconquered and unchallenged, raising hundreds of millions out of poverty, since 1991.

Yet the feeling of revulsion has, if anything, intensified.  The attacks and repudiations have multiplied.  Capitalism has lifted much of the human race from its ancestral misery, but it is above all to be condemned by its chief beneficiaries as a moral abomination.  Thomas Picketty tells us so.  Barack Obama tells us so:

So the basic bargain at the heart of our economy has frayed… this increased inequality is most pronounced in our country, and it challenges the very essence of who we are as a people… The problem is that alongside increased inequality, we’ve seen diminished levels of upward mobility in recent years… The decades-long shifts in the economy have hurt all groups:  poor and middle class; inner city and rural folks; men and women; and Americans of all races.

All those who wish to return to 1970 – or 1950, or 1920 – raise your hands.  There have always been people who romanticize the snows of yesteryear, but this strikes me as a new pathological reflex.  Something about capitalism nauseates a large class of thinkers, commentators, politicians, academics, artists, writers, moviemakers, and entertainers who participate in the system and know perfectly well that there are no alternatives.

The question is what.

Capitalism has been accused of ruthlessness and inequality, but all systems that preceded it were far more ruthless and unequal.  Greed is also a red herring.  I imagine that Capital in the Twenty-First Century, a runaway best-seller, has made a fortune for its author, who now stands in the same unequal relationship to other economics professors as do corporate CEOs to their employees.  Is Thomas Picketty a greedy man if he chooses to keep his money?  Is he a blood-sucking speculator if he invests it in the stock market?

Anti-capitalism sometimes resembles the anti-Semitism that has been so often associated with it:  a hatred of people who succeed when right opinion holds they shouldn’t.

But I want to put forward another possibility – one that is rarely considered.  Modern capitalism, properly understood, is a matrix of practical and ethical rules that place the burden of the future, with all its terrors and uncertainties, squarely on the shoulders of the individual.  To be a capitalist means to have internalized the “bourgeois virtues” McCloskey believes were responsible for the Industrial Revolution.  The effect is personal responsibility over future risk.

Capitalism in practice isn’t the implementation of the Sermon on the Mount.  Its towering figures are far from Christ-like:  they might be rampant nerds like Bill Gates, or visionary jerks like Steve Jobs.  But all who are in, big and small, stand on their own two feet.

Capitalism – together with its twin sister, liberal democracy – means childhood’s end.  We stand, for better or worse, as adults, liberated from the tutelage of priests and emperors, lords and kings.  Our actions have consequences.  We are now players in the cosmic drama and have achieved what is sometimes called “human dignity.”

Predictably, it was the old elites, the churchmen and the courtiers, who first drew up the charges against the capitalist class later accepted by Marx and Picketty:  that they were greedy, that they put on airs, that lending money was an activity best left to lesser beings like the Jews.  The rise of the capitalist was experienced by the old regime as a monstrous violation of the natural order, children suddenly running the household.  Here was the source of the gag reflex.

This infirmity has taken two distinct forms in the modern era.  The anti-capitalist movements of the last century raged against social rules and conventions, and despised the bourgeois for his self-restraint.  They craved the right to settle scores, the freedom of the assassin.  “We can’t expect to get anywhere unless we resort to terrorism:  speculators must be shot on the spot,” Lenin ordered.  Hitler’s “Night of the Long Knives” followed the Al Capone template.  Behind the romance of revolution lurked the grim impulses of violent criminals.

The dominant critique of capitalism today, however, is an updated version of the courtier’s complaint.  It asserts that the human race is not yet out of its infancy, and must be protected from its own decisions.  The new protectors are experts and bureaucrats who act on scientific principles.  The future is revealed to them alone.  They are the adults in the room, and they are able to see, at a glance, that capitalism is a screen for swindlers who profit from the innocence of the people.

President Obama began his administration with a plea that we “set aside childish things,” and the burden of adulthood in a nation of troubled minors has been felt in every word and deed of his since.  He does not believe that we stand on our own two feet.  He does not believe that we will figure out how the broken bargain of capitalism has “hurt” so many of us.  He’s certain that future risk will destroy us unless he intervenes with a firm parental hand – for example, by checking up on our credit card bills and seeing off the bad company we keep.

He is not alone.  The pope, for one, agrees with him.  Thomas Picketty and so many others agree.  If they are right, both capitalism and democracy are doomed.  If they are wrong – and, almost certainly, they are – then we had better hope that their callow gestures of disgust and theater of repudiation don’t wreck the Great Enrichment, and induce a self-fulfilling disaster.


2 Responses to Capitalism and its discontents

  1. gianni says:

    you realize that this is a couple hundred words of window dressing to justify you calling critics of capitalism children, right? aside from demonstrating that you need to brush up on your history, that is the only take away from this.

    next time spare yourself the effort and just come out with the invective – there isn’t much of value in all that accompanying text.

  2. Caro Gianni,

    The great danger in wielding the sword of invective is that it so often, unintentionally, is two-sided. Consider the possibility that it is you, not Gurri, who needs to brush up on your history.


    Deirdre McCloskey

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