Sunday, July 14, 2024

How To Save Free Enterprise

Who doesn't want to save free enterprise? In 1974 alone there were two books published with the title, How to Save Free Enterprise. One of them had the subtitle, "from BUREAUCRATS, AUTOCRATS, AND TECHNOCRATS." The other one, by Arthur O. Dahlberg, had no subtitle. Implicitly, then, "from ITSELF."

1974 was the high water mark for How to Save Free Enterprise books. There were none published in any other year, although the idea of saving free enterprise had its heyday in the 1940s. The antagonist then was frequently the New Deal, although Henry Wallace targeted monopoly in his Saturday Evening Post essay, "We Must Save Free Enterprise."

Dahlberg's prescription for saving free enterprise had two main parts. The first part was a scheme to discourage people from hoarding cash or demand deposits. The second was a throwback to his 1930's proposals for substantial reduction of working time to shift production to goods and services for which demand is spontaneous. I get the impression from how he talks about the latter, that it is his primary concern and that the monetary scheme was just a way to eliminate the fear of unemployment that in his view prevented people from choosing leisure over increased consumption of 'not spontaneously demanded' goods.

In his Introduction to How to Save Free Enterprise, John Chamberlain described Dahlberg as "a student of John Maynard Keynes who can both appreciate and see beyond the master." Chamberlain, incidentally, had also written the Foreword to the first U.S. edition of Friedrich Hayek's The Road to Serfdom and the Introduction to William F. Buckley's God and Man at Yale. Subsequently, he was a lifelong contributing editor to Buckley's National Review.

Dahlberg was not literally a student of Keynes. But he does tell of a discussion that he had with Keynes in Washington in which Keynes agreed with his contention about the theoretical soundness of a monetary instrument to discourage hoarding of money. Keynes doubted, however, that such an instrument could be devised. 

I have affectionately referred to Dahlberg as a crank regarding his elaborate chart art. In his radio talk, "Is the Economic System Self-Adjusting?" Keynes referred to the heretics from economic orthodoxy as surviving only in "isolated groups of cranks." He went on to affirm that he ranged himself with the heretics. 

Both Keynes and Dahlberg were concerned with the tendency of incomes to outpace consumption and investment and thus lead to slumps. Each conceived of a different technique for 'tweaking' the system to compensate for the imbalance; both saw the reduction of working time as the ultimate solution to it. 

Neither realized that Karl Marx had propounded similar positions about working time and about the failure of the economic system to self-adjust. He called it crisis tendencies. They also seem to have not been mindful of Michal Kalecki's analysis that big industry and big finance don't want to "save free enterprise."


Thursday, July 4, 2024

Self-Limitation as a Social Project

The following passage is from a 1993 New Left Review essay, "Political Ecology: Expertocracy versus Self-Limitation," by AndrĂ© Gorz. It is an argument for regenerating a norm of sufficiency as a political project. How much is enough and how can we build a popular consensus and movement around such a determination? Of particular interest to me, in the final paragraph Gorz mentions the "anonymous Ricardoite" along with John Maynard Keynes and Wassily Leontieff as examples of those who have seen disposable time as "the true measure of wealth." That Ricardoite was, of course, Charles Wentworth Dilke who wrote the 1821 pamphlet, The Source and Remedy of the National Difficulites.

Self-Limitation as a Social Project

In complex industrial societies, it is impossible to obtain an eco-compatible restructuring of production and consumption simply by giving the workers the right to limit their effort voluntarily (in other words, the possibility of choosing their working time, the right to ‘chosen time’). There is in fact no evident correlation between the volume of production and the hours worked. Once mechanization has abolished this correlation by enabling more and more goods to be produced with less and less labour, ‘labour ceases to be the measure of production and working time the measure of labour’ (Marx). Moreover, the diminution in the volume of labour necessary does not benefit the potential active population in general, and does not confer emancipation or the hope of greater autonomy on either the employed or the unemployed. Finally there exists no commonly accepted norm of sufficiency that could serve as a reference for self-limitation. Nevertheless, self-limitation remains the only non-authoritarian, democratic way towards an eco-compatible industrial civilization.

This project is not absolutely insurmountable. Essentially, it signifies that capitalism has abolished everything in tradition, in the mode of life, in everyday civilization, that might serve as anchorage for a common norm of sufficiency; and has abolished at the same time the prospect that choosing to work and consume less might give access to a better, freer life. What has been abolished is not, however, impossible to re-establish. But this restoration cannot be based on existing traditions and correlations: it has to be instituted; it is a matter of politics, more exactly a matter of eco-politics and the eco-social project.

An eco-social politics, as debated at length by the German and other European Greens during the 1980s and now emerging in French political ecology, aims fundamentally to restore politically the correlation between less work and less consumption on the one hand, and more autonomy and more existential security on the other, for everyone. In other words, it involves providing individuals with institutional guarantees that a general reduction in working hours will offer everyone the advantages people formerly sought for themselves: a freer, more relaxed and richer life. Self-limitation is thus shifted from the level of individual choice to the level of a social project. The norm of sufficiency, deprived of its traditional mooring, has to be defined politically.

Without going into detail on matters I have discussed at length elsewhere, I would recall here only that eco-social politics consists principally in giving a guarantee of sufficient income, independent of the duration of labour (which can only decrease), and perhaps independent of work itself; redistributing socially necessary labour in such a way that everyone can work (and work both better and less); creating areas of autonomy in which the time freed from labour could be used by individuals for activities of their own choice, including self-production of goods and services which would reduce their dependence on the market and on professional or administrative supervision, permitting them to reconstruct a tissue of known solidarities and social conviviality that would include mutual aid networks, the exchange of services, informal cooperatives, etc. The liberation of time, the liberation of individuals from heteronomous, functionally specialized labour, should be conceived as an overall politics that would also demand fundamental new thinking on architecture, town planning, public equipment and services, relations between town and country, and so on, in order to de-compartmentalize the different spheres of life and activity, and encourage self-organized exchange.

Political ecology thus uses ecologically necessary changes to the mode of production and consumption as a lever for normatively desirable changes in the mode of life and in social relations. Defence of the living environment in the ecological sense, and the reconstitution of a life-world, condition and support one another. Both require life and the living environment to be withdrawn from the domination of economics; both require the growth of spheres of activity to which economic rationality does not apply. This requirement, in truth, is as old as civilization. From the anonymous Ricardoite whose 1821 pamphlet Marx so enjoyed quoting to Keynes and Leontieff, the leading theoreticians of modern economics have all held disposable time for activities ‘valued as an end in themselves’ (die sich als Selbstzweck gilt, in Marx’s term from the Grundrisse) to be ‘the true measure of wealth’. This boils down to saying that economic activity has meaning only if it serves something other than itself. For economics is a clear example of ‘cognitive-instrumental reasoning’: a science for calculating the effectiveness of means, and selecting the most effective means to achieve a given end. It cannot be applied to ends which are not distinct from the means employed, and cannot in itself determine what ends should be pursued. When it is not supplied with an end, it chooses those ends for which it possesses the most effective means: it will adopt as a target the expansion of the sphere in which its own rationality applies, and will tend to subject to this sphere all others, including life and the natural foundations of life.