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Capitalism and Slavery

1 Aug

I’ve mentioned Greg Grandin’s book Empire of Necessity on this blog before. It’s basically the true story—and more!—behind Melville’s Benito Cereno, which if you haven’t read, you should read right away. And then read Greg’s book. In any event, Alex Gourevitch has a wonderful interview with Greg up today at Jacobin. It’s got all sorts of gems in it, but I thought readers here would be especially interested in this:

Scholars have long examined the ways in which slavery underwrites capitalism. I thought this story, though, allowed attention to slavery’s role in shaping not so much the social or financial dimensions of capitalism but its psychic and imaginative ones.

Capitalism is, among other things, a massive process of ego formation, the creation of modern selves, the illusion of individual autonomy, the cultivation of distinction and preference, the idea that individuals had their own moral conscience, based on individual reason and virtue. The wealth created by slavery generalized these ideals, allowing more and more people, mostly men, to imagine themselves as autonomous and integral beings, with inherent rights and self-interests not subject to the jurisdiction of others. Slavery was central to this process not just for the wealth the system created but because slaves were physical and emotional examples of what free men were not.

But there is more. That process of individuation creates a schism between inner and outer, in which self-interest, self-cultivation, and personal moral authority drive a wedge between seeming and being. Hence you have the emergence of metaphysicians like Melville, Emerson, and of course Marx, along with others, trying to figure out the relationship between depth and surface.

What I try to do in the book is demonstrate the centrality of slavery to this process, the way “free trade in blacks” takes slavery’s foundational deception, its original deceit as captured in the con the West Africans were able to play on Amasa Delano, and acts as a force multiplier. Capitalism disperses that deception into every aspect of modern life.

There’s many ways this happens. Deceit, through contraband, is absolutely key to the expansion of slavery in South America. When historians talk about the Atlantic market revolution, they are talking about capitalism. And when they are talking about capitalism, they are talking about slavery. And when they are talking about slavery, they are talking about corruption and crime. Not in a moral sense, in that the slave system was a crime against humanity. That it was. But it was also a crime in a technical sense: probably as many enslaved Africans came into South America as contraband, to avoid taxes and other lingering restrictions, as legally.

Sometimes slaves were the contraband. At other times, they were cover for the real contraband, luxury items being smuggled in from France or Great Britain, which helped cultivate the personal taste of South America’s expanding gentry class. And since one of the things capitalism is at its essence is an ongoing process to define the arbitrary line that separates “self-interest” from “corruption,” slavery was essential in creating the normative categories associated with modern society.

Why Aren’t the Poor More Responsible?

16 Jun

MIT economist Esther Duflo:

We tend to be patronizing about the poor in a very specific sense, which is that we tend to think, “Why don’t they take more responsibility for their lives?” And what we are forgetting is that the richer you are the less responsibility you need to take for your own life because everything is taken care for you. And the poorer you are the more you have to be responsible for everything about your life….Stop berating people for not being responsible and start to think of ways instead of providing the poor with the luxury that we all have, which is that a lot of decisions are taken for us. If we do nothing, we are on the right track. For most of the poor, if they do nothing, they are on the wrong track.

I’m not sure that “we” is as big as Duflo thinks, but her point is a good one. Reminds me of this post I did three summers ago.

The Calculus of Their Consent: Gary Becker, Pinochet, and the Chicago Boys

5 May

The economist Gary Becker has died. Kieran Healy has a great write-up on Foucault’s engagement with Becker; Kathy Geier has a very smart treatment of, among other things, feminist critiques of Becker’s theory of the family. And some more personal reminiscences of taking a class with Becker.

Kathy mentions this article that Becker wrote in 1997 about the Chicago Boys who worked with the Pinochet regime. Becker’s conclusion about that episode?

In retrospect, their willingness to work for a cruel dictator and start a different economic approach was one of the best things that happened to Chile.

No real surprise there. Many free-marketeers, including Hayek, either defended the Pinochet regime or defended those who worked with it.

But the Becker piece reminded me of that infamous Mont Pelerin Society (MPS) conference in Viña del Mar in 1981, about which I wrote at length two summers ago. The MPS is an organization of economists, philosophers, and assorted action intellectuals and businessmen dedicated to spreading the free market gospel across the globe. In the late 1970s, at the height of Pinochet’s repression, Hayek and a few grandees from Chile began discussions  about holding the MPS’s annual conference in the seaside city where the coup against Allende had been planned. The purpose in meeting there would prove avowedly propagandist. As the organization’s own newsletter later acknowledged, the conference provided participants with an opportunity

for becoming better acquainted with the land which has had such consistently bad and misrepresenting press coverage (and, perhaps for that reason, it was appropriate to have Reed Irvine, head of Accuracy in Media as one of the first speakers in the first session).

Becker was originally targeted or slated to speak on a conference panel titled “Education, Government or Individual Responsibility?” His name appears on an early agenda with a “T” next to it. For “tentative.” But Becker either never confirmed or pulled out. No matter: Milton and Rose Friedman, along with James Buchanan and Gordon Tullock, were there to show the flag—and the calculus of their consent.

Has There Ever Been a Better Patron of the Arts Than the CIA?

27 Apr

Countering Thomas Piketty’s critique of inherited wealth, Tyler Cowen suggests that such dynastic accumulations of private wealth may be a precondition of great art:

Piketty fears the stasis and sluggishness of the rentier, but what might appear to be static blocks of wealth have done a great deal to boost dynamic productivity. Piketty’s own book was published by the Belknap Press imprint of Harvard University Press, which received its initial funding in the form of a 1949 bequest from Waldron Phoenix Belknap, Jr., an architect and art historian who inherited a good deal of money from his father, a vice president of Bankers Trust. (The imprint’s funds were later supplemented by a grant from Belknap’s mother.) And consider Piketty’s native France, where the scores of artists who relied on bequests or family support to further their careers included painters such as Corot, Delacroix, Courbet, Manet, Degas, Cézanne, Monet, and Toulouse-Lautrec and writers such as Baudelaire, Flaubert, Verlaine, and Proust, among others.

Notice, too, how many of those names hail from the nineteenth century. Piketty is sympathetically attached to a relatively low capital-to-income ratio. But the nineteenth century, with its high capital-to-income ratios, was in fact one of the most dynamic periods of European history. Stocks of wealth stimulated invention by liberating creators from the immediate demands of the marketplace and allowing them to explore their fancies, enriching generations to come.

But the Belle Époque (and its predecessor) has got nothing on the CIA.

 The Central Intelligence Agency on Friday, April 11th posted to its public website nearly 100 declassified documents that detail the CIA’s role in publishing the first Russian-language edition of Doctor Zhivago after the book had been banned in the Soviet Union.  The 1958 publication of Boris Pasternak’s iconic novel in Russian gave people within the Soviet Union and Eastern Europe the opportunity to read the book for the first time.

The declassified memos, letters, and cables reveal the rationale behind the Zhivago project and the intricacies of the effort to get the book into the hands of those living behind the Iron Curtain.

In a memo dated April 24, 1958 a senior CIA officer wrote: “We have the opportunity to make Soviet citizens wonder what is wrong with their government when a fine literary work by the man acknowledged to be the greatest living Russian writer is not even available in his own country [and] in his own language for his people to read.”

After working secretly to publish the Russian-language edition in the Netherlands, the CIA moved quickly to ensure that copies of Doctor Zhivago were available for distribution to Soviet visitors at the 1958 Brussels World’s Fair.  By the end of the Fair, 355 copies of Doctor Zhivago had been surreptitiously handed out, and eventually thousands more were distributed throughout the Communist bloc.

As it happened, Pasternak went on to win the 1958 Nobel Prize for literature, the popularity of his novel  skyrocketed, and the plight of the great Russian author in the Soviet Union received global media attention.

Subsequently, the CIA funded the publication of a miniature, lightweight paperback edition of Doctor Zhivago that could be easily mailed or concealed in a jacket pocket.  Distribution of the miniature version began in April 1959.

These declassified documents about Doctor Zhivago are just the latest in a long line of revelations about how central the CIA was to the cultural and aesthetic life of the twentieth century. Was there a better patron of abstract expressionism—of Pollock, Rothko, De Kooning, at least on the global scale—than the CIA? And while the Saunders thesis of the cultural Cold War (the thesis long predates her, of course, but she helped popularize it after the Cold War) has its problems and its critics, the CIA did fund literary magazines like Encounter, even Partisan Review when it seemed like it was going to go belly up, international tours of symphony orchestras and jazz ensembles, and art exhibits around the world.

And while we’re on the topic of government patronage of the arts, let’s not forget the Bolsheviks, who managed, before the full onset of Stalinism and Socialist Realism, to fund, support, and inspire some pretty damn good avant-garde art. (And some not so good art: Ever since I learned that Ayn Rand developed some of her most enduring aesthetic tastes by attending, with the help of cheap tickets funded by the Bolsheviks, weekly performances of cheesy operettas at the Mikhailovsky state-run theater, I’ve held Lenin responsible for The Fountainhead.)

My most prized print is the poster of a 1971 exhibit at the Brooklyn Museum of “Russian Art of the Revolution.” It features El Lissitzky’s Sportsmen, which he did in 1923. (I managed to salvage it from the garbage after the office of a former colleague was cleaned out.) While eclipsed by the later exhibit at the Guggenheim, the Brooklyn Museum show was the first of its kind, I believe, in the States. In any event, it gives a good sense of what Soviet support for the arts achieved.

Russian Art of the Revolution

Cowen’s argument has a long history, but it’s not clear to me why he believes it’s dispositive. When it comes to funding for the arts, there’s more than one way to skin a cat.

Classical Liberalism ≠ Libertarianism, Vol. 2

22 Apr

Antoine Louis Claude Destutt de Tracy,  A Treatise on Political Economy (1817):

The truly sterile class is that of the idle, who do nothing but live, nobly as it is termed, on the products of labours executed before their time, whether these products are realised in landed estates which they lease, that is to say which they hire to a labourer, or that they consist in money or effects which they lend for a premium, which is still a hireling.—These are the true drones of the hive…

Luxury, exaggerated and superfluous consumption, is therefore never good for any thing, economically speaking. It can only have an indirect utility. Which is by ruining the rich, to take from the hands of idle men those funds which, being distributed amongst those who labour, may enable them to economise, and thus form capitals in the industrious class.

Friedrich Hayek, The Constitution of Liberty (1960):

There must be, in other words, a tolerance for the existence of a group of idle rich—idle not in the sense that they do nothing useful but in the sense that their aims are not entirely governed by considerations of material gain.

What today may seem extravagance or even waste, because it is enjoyed by the few and even undreamed of by the masses, is payment for the experimentation with a style of living that will eventually be available to many.

The importance of the private owner of substantial property, however, does not rest simply on the fact that his existence is an essential condition for the preservation of the structure of competitive enterprise. The man of independent means is an even more important figure in a free society when he is not occupied with using his capital in the pursuit of material gain but uses it in the service of aims which bring no material return. It is more in the support of aims which the mechanism of the market cannot adequately take care of than in preserving that market that the man of independent means has his indispensable role to play in any civilized society.

Tyler Cowen, “Capital Punishment” (2014):

Piketty fears the stasis and sluggishness of the rentier, but what might appear to be static blocks of wealth have done a great deal to boost dynamic productivity….Consider Piketty’s native France, where the scores of artists who relied on bequests or family support to further their careers included painters such as Corot, Delacroix, Courbet, Manet, Degas, Cézanne, Monet, and Toulouse-Lautrec and writers such as Baudelaire, Flaubert, Verlaine, and Proust, among others….The nineteenth century, with its high capital-to-income ratios, was in fact one of the most dynamic periods of European history. Stocks of wealth stimulated invention by liberating creators from the immediate demands of the marketplace and allowing them to explore their fancies, enriching generations to come.

For “Classical Liberalism ≠ Libertarianism, Vol. 1″, see here.

Tyler Cowen is one of Nietzsche’s Marginal Children

22 Apr

Tyler Cowen reviews Thomas Piketty:

Piketty fears the stasis and sluggishness of the rentier, but what might appear to be static blocks of wealth have done a great deal to boost dynamic productivity. Piketty’s own book was published by the Belknap Press imprint of Harvard University Press, which received its initial funding in the form of a 1949 bequest from Waldron Phoenix Belknap, Jr., an architect and art historian who inherited a good deal of money from his father, a vice president of Bankers Trust. (The imprint’s funds were later supplemented by a grant from Belknap’s mother.) And consider Piketty’s native France, where the scores of artists who relied on bequests or family support to further their careers included painters such as Corot, Delacroix, Courbet, Manet, Degas, Cézanne, Monet, and Toulouse-Lautrec and writers such as Baudelaire, Flaubert, Verlaine, and Proust, among others.

Notice, too, how many of those names hail from the nineteenth century. Piketty is sympathetically attached to a relatively low capital-to-income ratio. But the nineteenth century, with its high capital-to-income ratios, was in fact one of the most dynamic periods of European history. Stocks of wealth stimulated invention by liberating creators from the immediate demands of the marketplace and allowing them to explore their fancies, enriching generations to come.

Nietzsche’s Marginal Children:

In The Constitution of Liberty, Hayek developed this notion into a full-blown theory of the wealthy and the well-born as an avant-garde of taste, as makers of new horizons of value from which the rest of humanity took its bearings. Instead of the market of consumers dictating the actions of capital, it would be capital that would determine the market of consumption…

As this reference to “future wants and desires” suggests, Hayek has much more in mind than producers responding to a pre-existing market of demand; he’s talking about men who create new markets—and not just of wants or desires, but of basic tastes and beliefs. The freedom Hayek cares most about is the freedom of those legislators of value who shape and determine our ends.

 

More interesting is how explicit and insistent Hayek is about linking the legislation of new values to the possession of vast amounts of wealth and capital, even—or especially—wealth that has been inherited. Often, says Hayek, it is only the very rich who can afford new products or tastes….

The most important contribution of great wealth, however, is that it frees its possessor from the pursuit of money so that he can pursue nonmaterial goals. Liberated from the workplace and the rat race, the “idle rich”—a phrase Hayek seeks to reclaim as a positive good—can devote themselves to patronizing the arts, subsidizing worthy causes like abolition or penal reform, founding new philanthropies and cultural institutions….

The men of capital, in other words, are best understood not as economic magnates but as cultural legislators: “However important the independent owner of property may be for the economic order of a free society, his importance is perhaps even greater in the fields of thought and opinion, of tastes and beliefs.”

Three Theses (not really: more like two graphs and a link) on Nazism and Capitalism

22 Apr

Commenters on my little Nazism and capitalism post are claiming that the graph tells us nothing about the Nazis and capitalism; it only tells us that the economy improved under the Nazis. As it did in the United States under FDR. So maybe the graph plotting capital’s return under Nazism just shows general improvement in the economy in the 1930s, an improvement widely shared throughout the industrial world?

Luckily, Suresh Naidu, the kick-ass economist at Columbia, supplied me with the following graphs.

This first graph, which comes from Thomas Piketty’s Capital in the Twenty-First Century, compares the share of national income that went to capital in the US and in Germany between 1929 and 1938. Suresh tells me that the share roughly tracks capital’s rate of return. Long story short: capital was doing better under the Nazis than under FDR. Not because of overall increases in economic performance in one country versus another but because of the economic policies of the regime. Or so Suresh tells me. (Usually academics are supposed to acknowledge their debts to their friends and readers but own all errors as their own: in this case, I’m blaming everything on Suresh.)

 

From Thomas Piketty, Capital in the Twenty-First Century

From Thomas Piketty, Capital in the Twenty-First Century

 

The second graph—which comes from this fascinating article by Thomas Ferguson and Hans-Joachim Voth, “Betting on Hitler: The Value of Political Connections in Nazi Germany“—tracks the stock market’s performance in Britain, US, France, and Germany, from January 1930 to November 1933. As you can see, in the early months that Hitler came to power, Germany’s stock market performance was quite strong, outstripping all the others; it’s not until July that it even crosses paths with Britain’s, the second best performer.

 

From Thomas Ferguson and Hans-Joachim Voth, "Betting on Hitler: The Value of Political Connections in Nazi Germany"

From Thomas Ferguson and Hans-Joachim Voth, “Betting on Hitler: The Value of Political Connections in Nazi Germany”

 

The last tidbit I want to share is this article by Germà Bell, “Against the Mainstream: Nazi Privatization in the 1930s,” from The Economic History Review. Phil Mirowski sent it to me, after I shared with him the Bell article on the language of privatization that I cited in my previous post. This article also has some fascinating findings. From the abstract:

In the mid-1930s, the Nazi regime transferred public ownership to the private sector. In doing so, they went against the mainstream trends in western capitalistic countries, none of which systematically reprivatized firms during the 1930s.

 

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