The Political Economy of Freedom and Sovereignty

The far Left and the Libertarian Right converge on the same enemy:  the unholy alliance of the State and Big Business.  On what victory in the struggle would mean they diverge:  the Left, of course, ultimately wants Big Business swallowed up in the rational and humanitarian State, while the Libertarians want the state abolished (they distinguish “state” from “government,” supporting a minimal version of the latter—there seems to be small anarchist contingent, though), in which case businesses might become big but not Big—they would assume their own risks and receive no protection, direct or indirect, from their competitors.  Marx had an explanation for this increasingly intricate and essential alliance:  the state never was anything other than a “general committee of the ruling class,” which under capitalism meant the protection of bourgeois private property; so, when capitalism moves into its more advanced stage, and must confront deadly new resentments (the proletariat) and dangers (the threat—and promise—of military competition between capitalist states) the state must itself expand so as to take on these tasks—and the “monopoly capitalists” will be happy to let them do so, even if they grouse occasionally.  And the libertarian explanation is… well, other than some vague references to our having forgotten our principles, it doesn’t seem to me they really have one—which would be why someone like Ron Paul exceeds even the most fevered Leftists in his conspiracy-mongering.  Someone must have made a dirty deal behind closed doors.

 

If entrepreneurs are essentially a predatory class, as I hypothesized in my “Hunters and Craftsmen” post, then the explanation is not that difficult.  Indeed, Libertarians are well aware, going back to Adam Smith, that any time businessmen get a chance to receive some privilege or monopoly from the state they grab it, the free market be damned.  Of course, entrepreneurs are a very peaceful predatory class, for the most part, and are themselves always vulnerable to expropriation—hence their alliance with the state is fruitful in many ways.  But predation within the peaceful space created by stable state power is still predation, and we must distinguish the small marketplaces that spring up when the division of labor has expanded enough so as to make everyone dependent upon others (even allowing for merchants to mediate between communities, including distant ones) and the power of money within a system of trade and ultimately a fully developed market system.  A baker or carpenter who brings his goods to market is still just a baker or carpenter, but moving capital around requires no “instinct of workmanship” at all.  The difference is between a stable division of labor and one that is in continual upheaval.

 

I hope I don’t need to, but just in case I hasten to add that there is no critique of capitalism or the market, or the entrepreneur here, neither explicit nor implicit.  “Predator” is just another way of speaking about the “Big Man”; without the Big Man, there would have been no way of centralizing resources needed to move humanity beyond the level of egalitarian hunter-gather tribes; civilization itself is predicated upon turning this predatory figure away from preying upon the weak of his own group toward defending that group against external predators (and this shift is predicated upon a truce between all the contending Big Men within the group); all I am adding is that the Big Man “function” continues to this day and that—this in my view reveals the Libertarian mindset, in all its provocative brilliance, to be utopian—we can’t imagine civilization without it.  For all our egalitarianism (which, I also hasten to add, is in its own way absolutely real, and a powerful check upon predation), there is almost never (I’m not sure I need the qualifier “almost”) a situation involving a group of people of any size that doesn’t generate a center of gravity—someone dominates the conversation; someone’s words or deed were more memorable afterwards; someone’s judgment was deferred to; someone had to make the “call,” and in the end someone did; someone had to be blamed, and they were, etc.  It may be paradoxical, but precisely in free associations, hierarchies, however informal and provisional, become indispensable. 

 

Whenever such hierarchies are made quasi-permanent and ritualized, we have sovereignty.  And sovereignty is the opposite of freedom.  But we can’t do without sovereignty—it meets some very definite human needs, and is, in fact, what people usually mean when they speak about “human nature.”  Sovereignty provides identity, which is first of all self-sovereignty, and, again, is inimical to freedom, as identity is just another set of shackles.  Sovereignty also provides recognition, which is impossible if we, as free beings, transmute ourselves continually.  Sovereignty is the source of pride and honor.  It provides continuity, security and protection.  And in its communal function it stabilizes the volatile system of mimetic rivalry.  Sovereignty is involved in Isaiah Berlin’s “negative” as well as “positive” freedom—it is the answer to the question of “how far should rule extend” (up until it meets my private sovereignty) and of “who should rule” (those who allot me a piece of their sovereignty so as to help me ensure my own).   And property is the form of economic sovereignty.  Freedom (freedom “of presence,” to make a conceptual distinction), meanwhile, is the act and process of becoming sign, and that can’t be represented or guaranteed in sovereign terms. 

 

So, an originary political economy would study the intersection of freedom and sovereignty in the way each of us articulates the imperatives sent our way by every other one of us.  I think of the kind of simple account of the workings of the free market as both the best means of satisfying needs and as discovery procedure:  I have a certain amount of money, and I invest it in the raw materials and technology I need to produce a certain number of a particular kind of good, continually adjusting the price I ask until I have sold as many of them as I can within the period of time I can allow myself before I must reinvest or, perhaps, repay my creditors.  If I don’t manage to sell enough to recoup my original investment, or come close enough to reinvest, then I fail, we learn that there is insufficient demand for the product I was selling (there are enough of them out there already, or enough of a sufficiently close version, or it’s simply unneeded and unwanted), and someone else will invest in the technology I had used, ultimately putting it to better use.  There is no other way to find out what people want, or how resources should be allocated, than this one.

 

If I am successful, then I expanded, however slightly, the social division of labor; or, in more anthropological terms, social differentiation.  If consumers are buying my product because it is cheaper than what they have been buying, then resources are freed up to buy other products; if they are buying my product because it is superior technologically or esthetically, then whatever skill or knowledge went into the innovation I have introduced to the world has been affirmed as a source of value, and will inspire various iterations; and, of course, if they are buying it because it does something new, then work that was previously done privately and/or less efficiently is now embedded in the new division of labor, or wholly new faculties and desires have been created, and which are sure to lead to new demands and new innovations.  My interference in the existing social division of labor stimulates others to take advantage of the possible alignments now opened up, no less than the conquest of a part of a weakened state inspires other states to participate in re-dividing the state and redrawing existing borders—and this process could also be described in “law-like” terms.  The difference, and it is a big one, in economic conquest is less in the dispositions of the players than in the fact that social rather than physical terrain is at stake, and social terrain is both inexhaustible and subject to much more limited control.  (To extend the idea slightly, doesn’t advertising make perfect sense in these terms, as camouflage, bluff and feint, warnings to a population about to besieged, pronouncements on the current status of operations, announcements of new imperial projects, etc.?)

 

George Gilder argued in Wealth and Poverty that far from being selfish, we should see the entrepreneur as remarkably altruistic, giving his time, energy and resources to help others.  Ultimately, there may not be so much difference between this claim and Ayn Rand’s harangues on the virtues of selfishness.  They are both the dispositions of the sovereign, who does favors for whom he will do favors and ill to whom he disfavors.  With all the current talk about how much regulation we need and what kind, it seems obvious to me that regulation is almost always beside the point because any new innovation and the subsequent reorganization of the division of labor will render the existing rules obsolete.  Regulations are always attempts to fight the last war, and arguments in favor of more of them are almost invariable obscenely oblivious to the advantages of hindsight—everything that seems to us to be a cause of whatever crisis or scandal occupies us should, as all reasonable people can agree, have been outlawed.  It might be more useful to think of entrepreneurship as—as I believe many of them, in fact, do—a kind of war-making, maybe in conventional terms, with large, well-stocked armies with a long-term battle plan; maybe a kind of guerilla warfare; at times even a kind of terrorism.  The enemy varies—it may be those representing the existing division of labor, supported by state subsidies direct and indirect; or, it may be those instigating disruptions of the status quo—but I don’t see how one could deny that, in addition to producing, improving and disseminating their products, businesses spend quite a bit of time addressing the various fronts on which they fight:  labor, the state, or this or that agency, and their competitors.  (And even warriors, in the literal sense, must give quite a bit of attention to the production and distribution of goods, services, and the enforcement of the rights of various officials and “property” owners.)

 

If reasonable rules for waging war can’t be composed in the course of the battle itself, the various agreements forged going into and following battles (truces, alliances) can be enforced—that is, contracts.  There is even something a little irrational about this, as contracts must always presuppose a continuous state of affairs that makes their fulfillment possible, but promises to abide by such shared hypotheses, even or especially when realities emerge which undermine them, is ultimately far more rational because continuities can only be carved, to some extent arbitrarily, out of discontinuity.  In fact, all of the attention of government should be directed towards the strict enforcement of contracts, if only to give the signatories powerful incentives to construct their contracts carefully and make their reciprocal obligations as transparent as possible.  And this answers the question of how big the government should be:  as big as necessary to arbitrate effectively, indeed, unquestioningly, between the largest of the economic barons.  But not big enough to help anyone of them if they lose their fiefdom. 

 

Consumer sovereignty is a nice slogan but unsupportable as an empirical claim.  The relation between consumers and companies is analogous to that between voters and political parties:  the organizations propose, and the consumers and voters dispose.  (Or, more provocatively, between occupied populations and their conquerors, taking into account the desire for an extremely gentle occupation regime, including one that realzies the benefits of recruiting its administrators from the population itself.)  That is, the final purchase validates or invalidates a particular use of capital within a generally valid field; consumers regularly bring down empires, but the imperial system itself remains.  In case it’s necessary, I’ll make it clear that this is not a critique—I see no reason to assume that consumers (or voters) should weigh in any more heavily than this.  But the capacity to redirect the channels through which capital flows plays a very important role morally, and in providing the tacit rules under which the system operates.  It certainly makes a big difference whether the most unhealthy fast food restaurants or diversified, and increasingly tasty, health food alternatives prevail; or whether the main streets of medium-sized cities are littered with strip clubs.  Such redirections of capital in turn depend upon, and register, the degree of thriving of families, churches and other neighborhood institutions.  Indeed, I think those political movements likely to produce the most lasting effects will be those which focus on modifying consumer behavior, directly (through boycotts and savvy ad campaigns) and indirectly (by strengthening civil society).

 

The tension between the entrepreneur and the “craftsman” so evident in Veblen’s The Theory of the Leisure Class lies, I think, in the way outlays of capital continually upend—indeed, have their very significance in upending—the existing division of labor.  Veblen associates the instinct for workmanship with knowledge of causal relations in nature (as opposed to the superstitious nature of the “predatory” classes), which makes sense, but equally important here are traditional methods and guild-style relations and an esthetic sense.  The most virulent opposition to capitalism has often come from those pushed out of their artisan status by mass production—much of the rhetoric, if not the reality, of anti-capitalist politics derives from this kind of complaint, with which it is easy enough to sympathize.  But knowledge of causal relation, that is, the application of science to production, has a more complex relationship to the entrepreneur.  For a long time, in Marxist circles, there were arguments regarding the long-term effects of capitalism on scientific “labor”—the most politically appealing argument was that scientists would increasingly be reduced to wage laborers and supervisors of wage laborers, with intensifying specialization making it impossible for them to protect their interests as a group or individuals, leaving perhaps a few very elite scientists who essentially join the “ruling class.”  And, certainly, scientists, and especially those responsible for important technological innovations, have been among the most important new members of the economic “aristocracy” over the past few decades.  But if traditional educational institutions are eroded (or continue in their present course of erosion), can the free market be counted on to produce the number of scientists and engineers needed to keep de- and re-stabilizing the division of labor?  The math and science proficiency of American students, and the increasing dependence of American companies upon foreigners for high-tech positions (while we seem to do just fine in producing all the lawyers we need) makes this a serious question.

 

A good way to start to tie all these issues together is by reflecting upon another issue where the far Left and Libertarian right converge (and where I have come, conveniently, to agree with both)—the illegitimacy and need for abolition of intellectual property.  Intellectual property is a state granted monopoly over the uses others can make of their private property—the state can prohibit me from using my own printer and paper to copy something and distribute it, or to use my own raw materials of any kind to replicate a physical or chemical structure.  The argument against intellectual property is most potent in dealing with patents, I think, given how arbitrary the distinction between a real invention and some tweak of a method or process that is already well known is; it is most problematic, even distressing, in dealing with copyright, when we know very well who authored, painted or composed that original and irreplaceable novel, painting or symphony and it seems only just that they benefit financially from it.

 

Either way, I don’t see how intellectual property can possibly be maintained into the future:  can all personal computers be checked for illegal downloads?  Can we make China protect Disney’s copyrights?  Will India deny its poor knock-off medicines based on those created by American pharmaceuticals?  So, it may be better to speculate on a world without it.  This might be a good time to remind ourselves that the origin of creation lies in freedom, the kind of freedom that has its telos in the “discipline,” or a conversation aimed at soliciting revelations from some shared object or, in more anthropological terms, to make some object an inexhaustible source of signification.  This is done by iteration for its own sake, and I’ll update my definition of iteration here as obeying the imperative to apply the rule to the infinitesimal—that is, discovering what you are doing in some space where the making of rules and the interchange of tacit and explicit rules is generating transformations and applying the rules of what you are doing to some as yet tacit dimension of it.  So, for example, I realize that I organize my thinking into a certain pattern that I hadn’t recognized previously, or that has just emerged as distinct, and I apply the rule constitutive to that pattern to elements of my thinking that run in more established or random routines.

 

Inventions for use follow this logic, but are ultimately incidental to disciplinary habits and desires.  If authors and creators are denied the monopoly on the right to use their work for profit (a right more often exploited by entertainment and other corporations anyway, often at the expense of their hired creators), they might use their talents to invite people into unique disciplinary spaces that transcend the reproduction of an object.  That is, creation will become more pedagogical, organized around websites, public appearances, and other mediated events that take the created object as a changing center, one which the audience pays for the right to help change and witness in its successive metamorphoses.  New drugs might come to be invented in hospitals and other health care sites, and be administered as part of a total care experience; new technological innovations in other fields might also become embedded in a holistic set of service relations, as already seems to be happening with computers.  This denial of a state monopoly to the giant companies best able to exploit it might, in turn, lead to a push for the government to stay outside of the company-consumer relationship, which would now require constant and far more subtle fine-tuning and communication between the parties, irreducible to external regulation.  And the instinct for workmanship might revive as well in such integrated work environments, and the marginalist political activities like civil disobedience and boycotts take on more precise objects—supporting loved and needed “customized” institutions from state depredations.  (The laws against fraud, though, might get some creative workouts if more people think they can get away with claiming to be the producer or author of another’s work, as opposed to just using or disseminating it.)

 

So, perhaps we can locate a new political economic lawfulness in the degree of faith we find in our society and ourselves that creative activity unsanctioned, unprotected and uncredentialed by the predatory alliance of Big Business and the State (they’ve earned their capital letters!) can thereby generate even more creative activity and social and cultural good.  The less faith, the more government regulation, the more business takes on static, administrative, imperial roles; the more faith, the more sovereignty learns to embed itself in, rather than prey upon, freedom—and the more social health and prosperity.  We might even develop an appreciation for the contribution to this lawfulness made by the disciplines organized around the praxical study of risk, like hedge funds, and other inquirers into the myriad ways the miracle of making money out of money takes place.  (Yes, the warriors are themselves ultimately driven by freedom, their actions an adventure in exploration and hence a mode of inquiry.)  Such scouts in the world of economic warfare are among the most faithful in their own intuitions and abilities, and in the tacit rules of the system to sustain them—and they test out which battle plans are real, and which will dissolve upon contact with the enemy.  

 

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