Monday, December 26, 2016

Chomksy on capitalism

Noam Chomsky is a well-known American thinker. He is, unusually, a left-libertarian and is therefore anti-capitalist, but without turning to a centralised state as an alternative, as most leftists do.

I came across a quote from Chomsky (from here) which reminded me a lot of James Kalb's criticism of modernity. Kalb emphasises the idea that liberal societies are regulated along a combination of market and bureaucratic lines and so are "technocratic" in a way that leaves little room for traditional institutions or understandings to have any authority.

I believe Chomsky is outlining a similar criticism of capitalism when he argues as follows:
Capitalism basically wants people to be interchangeable cogs, and differences among them, such as on the basis of race, usually are not functional. I mean, they may be functional for a period, like if you want a super exploited workforce or something, but those situations are kind of anomalous. Over the long term, you can expect capitalism to be anti-racist — just because it's anti-human. And race is in fact a human characteristic — there’s no reason why it should be a negative characteristic, but it is a human characteristic. So therefore identifications based on race interfere with the basic ideal that people should be available just as consumers and producers, interchangeable cogs who will purchase all the junk that’s produced — that’s their ultimate function, and any other properties they might have are kind of irrelevant, and usually a nuisance.

What is "functional" for capitalism is that we are available as sources of labour and consumption, not that we have particular identities and loyalties - the latter make no sense within a system organised around market participation (i.e. they have no function within such a system). Therefore, those particular loyalties and identities will seem irrational, inefficient and obsolete to those who want a society run along technocratic lines.

A couple of decades ago, most people on the right were reflexively in favour of a society organised along market lines, which was a weakness of the right, as the free market tends to dissolve the understandings that allowed a traditional way of life to flourish. I'm glad to say that some on the right are now taking a more nuanced view of the market.

So what then is the alternative? I would take a three-pronged approach. First, I would strongly reassert the view that there are important human needs that cannot be met through a streamlined technocratic organisation of society. Second, I would try to make sure that traditional loyalties and identities did have some "functional" value to the economic workings of the society. This could be done, for instance, by giving some sort of advantage to local producers (so that these producers had good reason to support traditional loyalties). Third, I would not allow larger corporate interests to dominate the media, nor would I allow these interests to control political parties (for instance, via campaign contributions). (Perhaps a fourth idea is to make sure that there exist in society non-corporate institutions with influence, that have the explicit purpose of upholding the traditional values of that society.)


  1. Hi Mark, you seem to be putting forth attributes of the Catholic economic theory of Distributism, which had proponents in the form of Chesterton and Belloc.

    1. Compared to the current system of international corporatism, yes. I don't envisage a family-level system as the alternative, but I don't see why you couldn't have many more smaller scale, independent producers than exist now (if they were community protected/preferred). So I'm running with a moderate version of subsidiarity (but not to the extent of "three acres and a cow" - I'd like capital to be concentrated to the extent that you could have a dynamic and sophisticated economy).

    2. Hi Mark, I like your thinking for the simple fact many of our elite couldn't fit a cow on their balconies.

    3. "Compared to the current system of international corporatism, yes. I don't envisage a family-level system as the alternative, but I don't see why you couldn't have many more smaller scale, independent producers than exist now"

      This is economically incoherent. Business are owned by shareholders which are either individuals or corporate bodies. Small to medium enterprises (SMEs) are owned by individual shareholders who are in most cases family members. Larger companies require finance to expand so raise this capital on stock markets by selling shares to institutions. Most large companies are PLCs which are predominately owned by corporate shareholders who in most cases purge the business of its original owners so that they can assume greater control and direct the company exclusively for maximum profits and dividends.

      Astute business men do not allow outsiders to hold stock in their companies lest they eventually lose control of the business themselves hence SMEs are largely family owned. The inclusion of non family members is risky due to the increased risk of conflict.

      The direct consequence of large institutional ownership of business is oligarchy in which small numbers of people enslave the majority and enrich themselves off the back of the workers who are paid minimal wages. This is the situation in the West at present. Few family owned business are surviving. Most are being swallowed up and the owners evicted often with extremely restrictive covenants.

      Hence the options for an economy are a Corporate oligarchy or family owned SMEs. SMEs by necessity are family owned due to the need to retain confidential business information, expertise and control. The astute owners need to control who can gain access to information, expertise and contacts and hence they need to employ family members (their own and families related to them by blood). The risk of hiring outsiders is theft of information and diffusion of knowledge and expertise to competitors.

      Most of the European countries are SME economies but that is coming under threat now as the small businesses are being killed off.

    4. Anon (above), I only agree in part. I think it's realistic to have family ownership, but less realistic to limit employment to family members. If, for instance, you want to manufacture shoes, then the business could be run by a family, and what I would hope is that if the community were to give certain advantages to the business (e.g. a tariff against imports from low wage economies) that the business would then recognise an economic argument for supporting traditional loyalties. But does everyone on the factory floor have to be a family member? I don't see why. As long as the community sets a decent wage and working week, it doesn't have to be a negative situation for employees - and if there is protection against low wage/condition competition, then this would be possible (i.e. an enforced level playing field). My preference would be to set things up so that you had a few smaller, local manufacturers of, say, shoes (medium sized manufacturing at most), rather than one giant conglomerate.

    5. There is no such thing as a forced level playing field in business. Business by its nature is inherently risky, and requires ability to rapidly adapt to changing economic circumstances and market demands.

      The people a business employs depends upon the nature and capacities of the business itself but in general businesses support the interests of the owners and support traditional loyalties only where these coincide with the interests of the owners. Big business prefers diverse work force to reduce traditional loyaties and weaken the power of the workers. SMEs need loyal trustworthy employees. They can hire non family members for low level posts but not for influential posts.

      To set up small local manufacturers you need wealthy individuals to invest in plant. The corporates will not finance small manufacturing so you come back to the issue of family owned companies and the protection of family wealth.