How moral is the “free market” when you are apply principles of material determinism?

How moral is the “free market” when you are apply principles of material determinism?

Posted by in Economics of Blue Revolution

We have tended to spend a lot of time thinking about the left, in particular, their denial of the origins of our rights in the capitalist system and their failure to grasp the importance of “surplus value” as opposed to debt in any kind of “just” society. However, their critique of the “free market” whilst well intended, has clearly failed to “hit the right spot” at least as far as we are concerned. How so?

Almost total economic reliance on the free market and the financial sector arose in the 1980’s,  promoted by neocons like Blair and Clinton. They advanced a range of policies intended to stimulate consumption and therefore create economic growth.

The Western free market became more and more debt-dependent. What beguiles us is that whilst the free market has a lot of capitalisms DNA primarily values of contract, choice and consent which underpin our precious freedoms and liberty, it creates only fictitious wealth. Unlike real “surplus value” generated by capitalism, the free market relies on global labour market differentials and the financial engineering of debt to make a small elite very rich. It also keeps too many people in the West very poor.

It took us at BlueRevolution a while to “click” that the phrase used in the 1980’s to describe post-industrial economics, “a greater role for financial services” basically involved governments and people getting into more and more debt to pay for their and their nation’s consumption. Much of what is being consumed however is made on the far side of the planet so the act of “production” is removed from what should be an economic synthesis of production and consumption. A balancing act of land, labour and capital generating value to be acquired either by capitalists, workers or the State.

What does this mean for morality? Well, it would lead us to conclude that a number of social difficulties arise from this new “free market” model. Firstly to maintain consumption but without production, the economy has to have money fed into it. This is where debt comes in. Italy has debt equal to 135% of GDP. The UK is less but only because of the willingness of its working people to get into debt themselves.

Because we are economic determinists we believe our lifestyles and our morality will become shaped by our material circumstances which are basically indebtedness. One obvious consequence is that we can consume more than is sustainable for the planet to produce, as we can defer payment until a tomorrow that never arrives. Global warming may or may not be man-made but pollution certainly is!

After massive overproduction, the next most significant consequences of the free market model is that wage levels are fixed globally so work goes to the cheapest labour. The mix of land, labour and capital happens in China or Vietnam or elsewhere. This has resulted in a new class developing, not of revolutionary organised proletarians ready to seize control of the “capital” they produce, but a sad welfare and “healthcare” dependent class. This “class” is reliant not on worker produced capital or wages, but government debt for their miserable survival. For this group of second and third generation, ex-industrial workers (millions across US, EU and UK) choices in life are determined not by personal economic realities but welfare entitlements. The big pharma industries are always on hand to stimulate or lobotomise as required.

This is the constituency that is simply awaiting an ideology that makes sense to their hopeless existence and that could be Islamism or ideas from the far right. Certainly, in continental Europe the “free market” is both attracting migrants and then inflicting on them a living hell of welfare and idleness so they are at risk of becoming radicalised in ghettos.

The “liberal left” pretend to understand immigration, however, immigration needs a functioning economic system to proletarianise newly arrived people and turn them into workers with modern tolerant liberal values.

These values are based on capitalisms principles of contract choice and consent. The free market too often fails to find an economic role for these migrants. In the West promoting these values within an inclusive economy that demands their application as opposed to mere appreciation is how we should preserve our rights and freedoms and inculcate them into those for whom such principles seem alien. Particularly when women’s rights are considered.

Finally, after debt funded overproduction and its contribution to planetary destruction as well as the inability to engage all in society in meaningful economic activity, we have the morality of we consumers ourselves.

An economic choice is an important principle, who you work for and for how much is the way we identify worker from slave or surf. However today we have too many consumer choices which with their basis in debt aren’t realistic choices at all. Moreover, too much choice which comes too easily breeds a sense of entitlement that is dangerous when governments try to reign in public spending and thus limit choice. Our binary political system fails because consumers with a vote tend to want more not less hence spiralling national debt. Political parties are no longer able to represent the nation responsibly. People in politics and less party is required.

As the western free market lacks mass collective production people identify themselves as consumers and individuals, sort of unique units of consumption. This we believe explains the death of the “class system” in the Uk. As production is no longer a collective activity but a best an individual one individuals market just about anything they can. This is the West’s Achilles heel. For in the West we can now find a provider for just about any form of behaviour or product we might want to experience. “Industries” are created such as the pornography industry which takes a private non-commercial activity and sells it as a product to be consumed. Eventually, this goes mainstream and erodes our sense of interpersonal morality. It affects how we relate to each other too, we are consumed or the consumer of each other. Divorce perhaps reflects this sad reality.

Some “of faith” view this development as symptomatic of an increasing moral sickness and a sense emerges that our freedoms are to blame. The free market separates our behaviour from any sense of it being wrong, as long as what is produced and consumed has a price within the economy. A lot of groups and ideologies find this is justification enough to try and change our freedom loving way of life.

So, in conclusion, we have a free market loosely based on the values of capitalism but without capitalisms discipline and capacity to combine land, labour and capital to create value. The free market produces vast amounts of stuff for people to consume gobbling up resources and polluting the planet. People get rich within this model whilst others see their jobs go abroad and in the worst cases end up existing on welfare and drugged up in healthcare. The debt dependent workers pay for it!

We need to re-engineer our politics to reflect these economic realities making it more democratic and inclusive, to liberate people from what is becoming an increasingly dangerous and planet destroying economic political and social model.

 

Hierarchy and the link to alienation and social injustice.

Hierarchy and the link to alienation and social injustice.

Posted by in Uncategorised

In classical Marxist theory surplus (economic) value and the role of the workers who both create it and have it “exploited” from them by capitalists, is central to how both capitalism and socialism work.

The process of taking surplus value from workers is akin to theft but that is not the term Marx used, he was perhaps being too polite or more likely he didn’t see capitalism as an unjust system, just unfair. Theft is unjust, exploitation unfair!

The worker works longer hours than he or she needs to, so as to ensure that surplus value is created and in doing so they develop an instrumental relationship to their work. They can’t enjoy it but they have to do it to live. The conclusion we draw from this process is that workers work too much and it is time rather than money that is the basis of 19th-century capitalisms unfairness. The industrial structures of the factory also reinforce the worker’s sense of powerlessness. They are not in control of the industrial processes that determine the pace of their working lives.

This demand for the workers surplus value and the environment within which it is created is the capitalist systems manifestation of the age-old problem of one human, generally male, and holding a superior position taking away from someone else what that someone else has worked hard to create, whilst to varying degrees controlling that person’s life. Every society since the birth of human consciousness has been discriminatory in one form or another. Underpinning this process of discrimination is control by a hierarchy, differently configured, as either tribe, feudal system or industrial hierarchy which causes the worker to feel powerless or oppressed and in the case of capitalism having external control on their work. There is in all societies a trend for control, the controls differ markedly from society to society.

The process of capitalist exploitation gives rise to another classic Marxist theory, the theory of “alienation”. Thus the surplus value taken by the capitalist from the worker is a kind of monetary reflection of the extent of the worker’s alienation.

Alienation is the physical and psychological effect of a worker being exploited. In a strange ironic twist fate for the world, the solution offered by the free market to the alienated worker is the almost limitless supply of goods. The demand for goods by workers has replaced religion as the “opium of the people”. This perhaps explains the success and survival of the free market given it has a debt-dependent and a planet-destroying legacy. People accept being alienated so long as they can purchase goods and the system will produce jobs and goods as long as the debt is available to pay for them.

Now bringing things up to date surplus value is no longer being produced by the capitalist system in sufficient quantities to be taxed by the government and thereby service the social, health, welfare and other state obligations.  As a result of western capitalisms failure (it thrives elsewhere!), free market indebtedness has become the means by which the free market a remnant of the western capitalist system, is able to function and produce apparent wealth.

Workers exploitation and alienation have become markedly different since the mid 19th century. Today people have developed a taste for buying stuff made abroad and pay for it with debt that they have to work to pay off. All this in the false belief that spending overcomes alienation rather than reinforcing it, giving alienation in effect a social character. Arguably divorce rates reflect alienation’s social character, people only being concerned about themselves.

The description of capitalism based on a classical model no longer works today as it would have worked for Marx. So what has happened to exploitation, and alienation within the 21st-century free market?

Whilst the impression given by the advocates of the modern western economy is one of promoting abundant goods and services for the consumer, the reality is that it is cheap foreign manufactured goods that mask the continued existence of alienation. In a world with little actual classical capitalist exploitation, how does exploitation still exist and are workers still alienated? We think these are good questions and we will attempt to give a fuller answer here.

Whereas the Classical Marxist worker was not rich enough to get into debt, today the whole western economic model depends upon workers and government debt. What we have is what we at ABlueRevolution call deptamorphosis.

This is the process which sees the worker using their debt to promote a wealthy free-market elite. They do this working long hours often in public service organisations which are still modelled on 19th-century industrial hierarchies. Many earn money paid from government debt, to service their personal debt-dependent lifestyle. This is as alienating for the worker today as it was in the 19th century as they have no influence over their working practices (KPI’s today), nor the ability to escape the treadmill of debt. Just like in Marx’s day the worker has “freedom” to leave the workplace but has little likelihood of using it.

Thus whilst the working environment is a safer environment than in Marx’s day it is no less alienating. Today the worker may be doing work that has little or no economic value, and more controversially little social value either. A state employment system based on hierarchical industrial models and which pays its workers to blame the unemployed because their jobs have gone to China or a health service maintaining a low level of wellness in a system all paid for with debt is alienating for all.  This is not an economy free of alienation. Workers don’t feel linked to the people they serve as customers or patients, they are forced to feel a closer link to the system which controls them and pays them. No difference here to the hierarchy of the industrial era and there are huge differentials in pay.

Likewise expecting the worker to become indebted to make “free marketeers” and public servants rich is a new way of exploiting workers that Karl Marx could not have identified if he had lived into the mid 20th century.

Perhaps the solution is to look at where in any modern organisation the social value is created and liberate workers at that level casting out of the organisations the people who have high wages paid to them but they offer little in the way of social value.

If Capitalism had been forced to yield to the dictatorship of the workers, as opposed to evolving into the debt-dependent planet-destroying monster the free market has become, then it is the capitalist and their exploiting hierarchy that would have been put asunder, not the work or the workers themselves. There are lessons here for operational public servants in all departments of the state and the army of 100k+ a year bosses who manage them.