Posts Tagged ‘neoliberalism’

The Economy is not real and hence cannot be controlled

December 27, 2020

Slobodian argues that one of the neoliberal objections to socialism was that because we cannot see or predict the economy we cannot govern it or reform it democratically. The ‘economy’ as such does not exist. Partly because the term oeconomy comes from Greek and means the governance of a household, not the governance of a polis or a wider sphere, which cannot, according to neoliberals, be governed in any useful way for the populace.

Hayek, for example, “says more than once in his writings that one of the great fallacies of the twentieth century is the belief that there is something called the economy, that can somehow be seen and controlled and managed. And he could say that because the invention of the economy was mostly a social democratic, Keynesian project” aimed at maintaining full employment and survivable wages. Inventing the economy “was a project of governing and collectivizing risk.” [1]

As Hayek says in his Nobel speech, “it is ‘the pretense of knowledge,’ to think that you can actually have any kind of oversight over the economy as such.” [1]

As this economy does not exist (hence Hayeks use of the term ‘catallaxy‘ for what people would normally call the economy) we can only use very precise rules to protect the market and submit to it: “we must give ourselves over to the forces of the market, or the whole thing will stop working” [2].

The only neoliberal liberty is submission to the limited options the market allows. “The normative ideal for the individual is a kind of total subjection to the forces of competition. We gain our freedom insofar as we subject ourselves to that.” [1]

Neoliberalism needs a market police to prevent people from “kept trying to make the earth a more equal and just place.” This interest people might have in not being ripped off, is a special interest in neoliberal terms, whereas corporations do not have such special interests – their interests are just the market in action. [2]

The big public idea promoted by neoliberalism is that if the ‘catallaxy,’ or what people would normally call the economy, is defended, then all will work out well or at least as well as we can ever expect.

Social Life is Complex

A more recent way of dealing with this problem, is to realise that the ‘catallaxy’ is a complex system and it is embedded in other complex systems, which are important for its functioning and survival.

Crucially, it is helpful not to subscribe to a dogmatic optimism about complex systems. Complex systems, no matter how adaptive, will not always seek a balance, harmony and efficiency which are beneficial to humans; they may require some mild corrections or interventions to achieve anything resembling what we might consider beneficial for most people, never mind all people.

This presents a problem as complex systems cannot be governed rigorously or in a guaranteed manner, neither can specific events be predicted.

We can, however, seek patterns of complex behaviour, and we can make general trend like predictions, and adjust things accordingly and carefully, getting rid of what has not been working.

It may not have been possible to predict Trump or his specific actions and failures, but we can predict that if democratic control over the economy is completely surrendered we will likely head for plutocracy, as massive wealth is where the power is. Plutocracy will likely head towards autocracy, and autocracy can look like fascism, or arbitrary rule. Consequently, we need to be aware of this possibility, and do our best to prevent it in advance, should we wish to maintain freedom.

We can predict that neoliberal ‘free markets’, will lead to a decline in the share of the wealth, generated by society, going to ordinary people defeated by the market. This will almost certainly reinforce the power differentials, and likely lead to the problems of ordinary people being dismissed from consideration. Again we need to undermine this possibility, possibly by redistribution of wealth and inheritance.

We can predict that market crashes will happen more frequently, and that big business will get bailed out by the tax payers (as the point of agitating for what are called ‘free markets’ is to protect big business) and that small people will suffer. Again we can shift our focus from just protecting the “big end of town” and make sure we attend to people in general.

We could have predicted that neoliberals would try and force people to catch a pandemic in the hope of keeping the economy going, and that they will agitate for massive taxpayer support for industries which were already failing before the pandemic hit. Mass death, and long-term disease generated incapacity and injury in people, will not help the economy recover in a way which benefits everyone in the long term. The neoliberal method is not the best for dealing with all problems. The health of the economy, can depend upon the health of the social system and people in general. Free markets cannot be isolated from everyone.

We can predict that if we do not protect and regenerate environments and ecologies, that the survival system as a whole will crash and that large numbers of people will be displaced and die – we can also predict that neoliberals, devoted to protecting existing big businesses, will object to protecting environments as it is a cost to profit, and they will spend a lot of money to persuade people they are correct. However, we do not have to accept massive environmental destruction as a part of the capitalism we need to gain a working economy. We can probably solve this problem by regulating emissions and destruction for all companies equally, and making it easier for local people to take destructive and polluting companies to court. This way, people get to participate in deciding what kind of environment they have to live in. Capitalists get to solve the problem of keeping ecologies functional, by making destruction and pollution a cost, or potential cost, to them.

It may be impossible to completely regulate markets and ecologies, but that does not mean that we have to let the bad results completely triumph. We experiment, and try and see what works, and consider the possibility of stopping doing whatever delivers more harmful results.

There is no reason we cannot have freer markets than we have now, with democratic input into preventing harmful, monopolistic, ‘crony’ and authoritarian corporate behaviour as it evolves, and with a dedication for protecting life on Earth.

Neoliberals appear to want to stop that from happening, as it challenges corporate liberty to do whatever corporations want at the expense of the populace.

Liberty is necessarily a balancing act.

Slobodian on Anti-democratic Neoliberal relations to the State

December 27, 2020

I have just encountered the writings of Quinn Slobodian. He has an interesting take on the role of the State in Neoliberalism, and Austrian Economics. It is worth looking at, but I have not yet read his major book The Globalists. His arguments make it clearer that Neoliberals and Austrian Economists are not Libertarians, or anarchist at all, despite the support they receive from Libertarians. Neoliberals primarily want protection of markets, and market organisation, from States, but have no objection to States in principle, as long as those States defend markets and market power – especially against the people.

Protecting the market, wealth and property

Neoliberals attempt to “to insulate the markets against sovereign states, political change, and turbulent democratic demands for greater equality and social justice.” [1] For them, the State exists to protect capitalism, its extracted property and the world economy as it is, not to open the economy to ordinary people on equal terms. Neoliberalism was “less a doctrine of economics than a doctrine of ordering—of creating the institutions that provide for the reproduction of the totality [of the system].” [2]

The Fascist moment

Consequently, neoliberalism is a form of regulation rather than a form of anarchism. It probably developed as a preventative response to socialist movements, and the fact that their favoured fascism did not provide quite the defense of property that they had otherwise expected.

Mises argued that communists were murderous and the fascists reacted reluctantly in kind, but they, unlike the Russians would be unable to get rid of thousands of years of civilisation. Mises wrote in 1927 that:

Because of this difference, Fascism will never succeed as completely as Russian Bolshevism in freeing itself from the power of liberal ideas…. Fascism, in comparison with Bolshevism and Sovietism, [i]s at least the lesser evil.

Mises Liberalism, Online Library of Liberty: p: 49.

It cannot be denied that Fascism and similar movements aimed at the establishment of dictatorships are full of the best intentions and that their intervention has for the moment saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history. But though its policy has brought salvation for the moment, it is not of the kind which could promise continued success. Fascism was an emergency makeshift. To view it as something more would be a fatal error.

[3], & Mises Liberalism. Online Library of Liberty: p: 51. emphasis added.

This was not uncommon at the time. Slobodian remarks that Carl Schmitt “saw the need for what was effectively a fascist state as a way to prevent the rise of totalitarianism.” [4]

[I]n the late 1930s, Wilhelm Röpke, another leading neoliberal, would unabashedly declare that his desire for a strong state made him more “fascist” than many of his readers understood. We should not take this as a light-hearted quip.

[4]

In other words Fascism, and the autocratic State, was useful to maintain capitalism and its civilisation for a while. There seems little objection to the idea of an ‘intellectual’ fascist State as such, and of course, Mises could not understand where German fascism was to go. However, he fled the Nazis after the occupation of Austria.

Later on (1951) Neoliberals such as Mises and Hayek were to conflate Fascism and Nazism with socialism and Bolshevism, which ignores who sponsored them and why, and indicates a degree of hard and misleading binarism in their thinking. Socialist democracy in the UK and Australia between 1950 and the early seventies, and Scandinavian socialism is, according to them, the same as Nazism, Stalinist Communism and so on. If it is not the capitalism they support, it must be socialist, and must be evil. There is no ability to see degrees here, everything ‘bad’ is lumped together, as politically useful to support the idea that free markets lead to liberty, rather than to plutocracy and potential fascism.

We may also note the hostility of neoliberals to any effective idea of equality. Equality, in their view always demands an interventionist State, and therefore an authoritarian State of the wrong kind. Again the hard binarism is brought into play. They take a position we all know to be correct, namely that some people are more talented, dancers, musicians, painters, mathematicians, preachers, basketball players, swimmers etc, (and that some of these people work really hard to make themselves better), to say that one unlimited distinction in power and wealth between people based on the talents of business or inheritance is equally banal, harmless and even pleasurable.

Truly massive power and opportunity differences produced by the corporate market are to be defended at all costs, with the implication is that if you don’t succeed, you are inferior.

Neoliberals want to suppress the power of democratic peoples to challenge corporate capitalism and its wealth based power – and to prevent any kind of relative equality which might allow people to challenge corporate power. Hence the conflation of socialism, fascism and democracy, and the initial wary support of fascism which was common amongst the conservative and pro-capitalist Right at that time for similar reasons.

Containing protest through the State

The basic neoliberal position is that governments by attempting to control or interfere in the workings of the market generate inefficiency and autocracy – but it seems they refuse to consider the effect of corporations interfering in the working of the markets – or make it beneficial as with their denial of the market powers of private monopolies.

Therefore regulatory movements, and labour movements aiming at improvements for workers, or colonised people, must be crushed. Neoliberals had no objection to regulating protest against their favoured economic set up. Mises was, for example hostile to labour movements, and supported their suppression.

This led to some neoliberals supporting apartheid [3]. We are also left with Murray Rothbard’s lament against Martin Luther King:

mass invasion of private restaurants, or mass blocking of street entrances is, in the deepest sense, also violence. But, in the generally statist atmosphere of our age, violence against property is not considered “violence;” this label goes only to the more obvious violence against persons

Essentially, hurting property is as bad as harming people.

“Any lingering idea that neoliberals are anti-state will be dispelled because you can see that, in their own writings, the whole project of neoliberalism is about redesigning the state, especially in questions of law.” [4]

“Even a superficial reading of the primary texts of neoliberals makes this clear. Milton Friedman’s Economic Bill of Rights, James M. Buchanan’s fiscal constitutionalism, F. A. Hayek’s Constitution of Liberty, Gottfried Haberler’s proposals for GATT, Ernst-Joachim Mestmäcker on European competition law, William Landes and Richard Posner on intellectual property rights—the list goes on.” [5]

To some extent their way forward was through setting up international modes of regulation that were, explicitly non democratic, and not responsive to the people anywhere, such as the WTO.

This is not to say, that post the internationalist age, neoliberals are not comfortable with promoting nationalism and even tariffs if it helps support corporate power, or is seen as a tactic in compelling ‘free trade’. [7]

Unintended consequences (?) of neoliberalism

There is no “one-to-one transposition of blueprints from the pages of Hayek or Haberler or whomever to reality in some unmediated or direct way.” Ideas work through “uptake by domestic actors, who find certain of their own interests fulfilled by adopting neoliberal policies.” [4]

“The only reason why empire works is that it finds willing compradors and domestic elites who will do the work of empire for the metropole for the most part.” [4]

And this may have unintended effects (along with complexities of markets). For example:

Intellectual property rights become part of the WTO not because Friedman or Posner wanted them to be there, but because pharmaceutical companies, software companies, apparel companies, entertainment companies wanted them to be there and were very good at lobbying.

[4]

In other words, putting defense of the corporate market first, opens up further opportunities for important players to twist the market into favouring them, and diminishing the rights of ordinary people – in this case to use their own culture. In other cases we may note neoliberal attempt to defeat people’s right to drink non-poisoned water, and breath non-polluted air, and eat safe food.

Defending corporate liberty to pollute, set up monopolies, set up their own laws and police, or pay for politicians and political propaganda, may well set up the circumstances in which other people’s liberty is severely curtailed. Their liberty may not equal yours.

This loss of public liberty might count as an unintended consequence of neoliberal politics and theory intended to defend liberty but, then again, it might not.

The theory of the Capitalist State

December 22, 2020

There are a number of different theories about the Capitalist States.

The standard Libertarian argument seems to be that you just roll back, or get rid of, the State and all wealthy capitalists will renounce their privilege and let everyone else live in liberty and prosperity, untroubled by the inequalities of power and wealth that may arise.

The slightly more conventional, capitalist theory is that the State is needed to enforce property rights, enforce contracts, while providing a relatively neutral legal framework to solve disputes among the powerful, and defend against foreign states. Possibly the State should also stabilise things after massive market failure. Although there seem to be some who do not seem to believe the market can ever fail so, in their view, this is not needed. This is more or less the standard official neoliberal position; with the addenda that the State should be as small as possible. As suggested elsewhere in this blog, the actual neoliberal position seems to be that the State should defend the established corporate power and market structures against ‘democratic’ political change, or even natural change, because this is really important.

Other people see capitalism not as trade (trade goes on everywhere, even in communist states), but as a set of patterns of power relations built around particular organisations of extraction, production, distribution, and trade etc., which tend to favour the already wealthy (those with capital, or access to capital). Capitalism is not in any way, an inevitable ‘natural result’ of people engaging in exchange. Historically, capitalism has grown out of the violence of the slave trade, dispossession of people from their land, colonial depredation, forcing people to engage in trade. forcing people into wage labour, suppression of workers’ organisations, enforced occupational illness, environmental destruction and so on.

Capitalism tends to destroy self-sufficiency for most people, and throw them onto the labour market, where they are expected to obey a boss. It is not an inevitable model of liberty. Saying you can choose your boss, is bit like saying you can choose your master, or your State. This violence and destructiveness, generates a level of resistance by the population in general, and this resistance needs to be channeled into supporting the established systems of market and political power (perhaps through people like Trump).

If you have this view, then you will expect a capitalist state to slowly move towards plutocracy. In a plutocratic State, wealth buys politicians, laws, regulations, violence, the information which gets circulated, and so on, and hence (over time, as money can buy almost anything), the State becomes governed to benefit the ultra-wealthy. Corruption and ecological destruction become normalised. Wages stagnate. Economic crashes become regular affairs, and the established elite are bailed out from their mistakes. The Government subsidises the corporate sector, either directly or through military spending, etc. This all happens, because, in a capitalist world, that is clearly what the State is for. Ordinary people feel the State no longer listens to them or ignores them (and they are largely correct). This is more or less what we have today, after 40 years of ‘free market’ boosting.

This does not mean that all wealthy people share all interests in common. They may well fight over minor issues, but all sides largely aim to keep the State plutocratic, and to protect their wealth.

The set up aims to ensure that people think their best interests involve trying to go along with the established organisation, or that they can try to take advantage of this organisation for their own benefit.

The Capitalist State engages in planning so as to maintain the power of capital, as best it can.

If you were in favour of abolishing the State then you probably have to void all other sources of power, including wealth, as those people with wealth will get around to setting up a State over you, to defend and entrench themselves. If you were in favour of a minimal State then you probably also have to guard it from takeover by the wealth elite, or the religious elite, or techno elite, or the military elite etc….

It is hard to keep States relatively democratic, and no easier under capitalism, especially if the power of labour has been crushed, which is an aim of capitalism in general.

Neoliberal Conspiracy 08: Is the idea of neoliberal conspiracy plausible?

December 20, 2020

[This post is a slightly revised version of the original, and now deleted, end of the post Neoliberal Conspiracy 07]

Is the neoliberal conspiracy theory plausible?

Wealthy people do have power. The more wealth they have the more power they can exert if they choose to. The fewer non wealth based sources of power that are around, or are not phrased as businesses, the more power they can exert. They can buy all the other kinds of power from political representation and legislation, through violence, to communication and information. They can buy status, because they must have virtues if they are wealthy; they must be wealth generators for everyone, and deserve special privileges. Neoliberalism appears to both increase their power and hide opposition to that power. So wealth-power and neoliberalism fit together quite harmoniously or, as in a previous blog post, we can say that crony capitalism is normal capitalism, and neoliberalism intensifies crony capitalism.

It is not difficult to find the main propaganda points of neoliberal ideology in the media and elsewhere. It is widespread, although the analysis of what neoliberals actually do, and aim to achieve, is not. This lack is also significant.

Thus it is easy to find people extolling the virtues of business, the talents of business people, the centrality of ‘the economy’ to prosperity and freedom, the importance of growth, the importance of tax-cuts, the importance of cutting regulation, the importance of free markets, the connection of free markets to liberty, the idea that governments are always useless, the parasitic nature of people on welfare, the evils of socialism and the left, the evils of ‘greentape’, the need to encourage the economy whatever, and so on. Business news is expected, even if ordinary people don’t read it or watch it, union (marxist, or communitarian anarchist) news is not. Neoliberal ideas are widely and repetitively propagated. This is hardly surprising given corporate control of the media.

Thus not only do neoliberalism, crony capitalism and increasing the power of wealth (plutocracy) fit together but the main points of the ideology are so prevalent that they can be taken as ‘common sense.’ They can be referred to and accepted, without needing justification. They must be true. They can seem true a priori.

This does not mean the wealth elites are totally united. For instance, some of them don’t like Trump, even if he is carrying out most of the neoliberal programme, doing quite well at hiding it and cultivating passionate followers to help keep the project going. It is as equally possible they don’t like him because he defrauds other businesses and his word means nothing, as that they dislike him because he is doing something mysterious to benefit ordinary Americans, as is frequently alleged. Some people in dominant groups actually believe in climate change as well, but the media rarely explains why it is happening, and it usually reports climate change in a way suggesting its not that much of a problem for neoliberalism, or we just need to act as individuals. This is the more humanistic version of the conspiracy in action. The result is much the same; maintaining elite wealth and power comes before dealing with climate.

All this implies, the idea of Neoliberal conspiracy is plausible.

Neoliberal explanations of the problems

On the other hand, Neoliberals tend to explain the current crisis of democracy in terms of ‘government,’ which they control but pretend is controlled by others. These controlling and malevolent others appear to include ‘cultural marxists,’ ‘critical race theorists’, postmodernists, socialists or whatever is today’s evil figure. The problems that we face result from some big and dangerous conspiracy of the Left, or are invented by the conspiratorial Left out of thin air (i.e. the climate fraud, the covid fraud, the Biden victory). This is heavily implausible.

I’ve no real idea what cultural marxism or critical race theory is, and I’m not sure the general public would understand the main points of these ideologies either, as put forward by their supposed proponents. These theories don’t seem as widely distributed and explained as they would be if they were important to a major power group. So, if these movements exist, they are clearly not being promoted by a particularly powerful or influential class. They are not widely taken for granted by people. And the general approach in the media, would seem to suggest that you can just say ‘Cultural Marxism,’ or ‘Critical Race theory’ and know that your audience will assume whoever is being associated with these theories must be evil, even if the audience don’t know what they are. Jordan Peterson seems to have made a career out of behaving like this.

From this alone, it seems likely that the opponents of these cultural marxists, whoever they are, have all the relevant power, or the strategy would not work.

[My initial hypothesis was the neoliberals and their supporters could not use the old horror of revolutionary Marxism, because it was nowadays so rare, and so they turned cultural criticism (which is a standard from of Western behaviour, since Plato or the Reformation, depending on your choice) into a dismissible evil, by calling it cultural Marxism. But then I remembered how a few people who got together to protect some protestors from attacks by fascists, became portrayed as a vast, violent and subversive movement who conveniently wore black clothes and supported Joe Biden. So the neoliberals could have pretended that revolutionary Marxists were still a problem, and perhaps by magnifying anti-fa they did.]

Academics, who I suppose are supposed to promote these things, don’t have much power. Universities are nowadays run as neoliberal business, with generally relatively high level business executives in charge (often such overt neoliberal ideologists as Maurice Newman). Universities nowadays aim to bring in money, not change the world. Academics frequently have to ally with the corporate classes for research money, so the days of investigative independence is fading. In Australia academics were among the only people not eligible for the highest government support if their jobs were made redundant by Covid. Again not a mark of power. So the chances are high that those who tell you academics are powerful are lying to cover their own power and give you a relatively powerless enemy to dislike.

Then I guess there are scientists. Obviously neoliberals will argue that scientists are less trustworthy than businesses or the hunches of demagogues (Trump is great at that). The idea seems to be that, if science clashes with neoliberalism, it is necessarily wrong, despite all the successful stuff it does elsewhere. I’m more than a bit skeptical about that position. This does not mean scientists cannot be wrong; they are human (just like neoliberals), but they are the best we have got at the moment, and science tends to be self-correcting. That is how it works, and it is also why scientists and doctors can seem to change their minds quite often; they are ideally persuaded by the evidence, and new evidence is always arising. Yes they defend the positions they are currently holding, but eventually those positions fade – they are not held to be true a priori, and beyond challenge, like neoliberal economics. Scientists are often persecuted by governments and businesses, who remove data from websites, sometimes from libraries, forbid them to talk, smear them when it is handy, or sack them if they don’t give the correct neoliberal response. So they don’t appear to have much that much power as a class. They often can’t even get people in power to consider the desperate state of the planetary ecology. They also don’t have political unity as a class, as there is no particular politics necessarily associated with physics, geology, biology or whatever. Science is not like economics, where neoliberalism will get you places.

There is less obvious basis for scientific power outside the corporate sector anymore, and that is likely subject to neoliberal control. This is why we should not particularly trust pharmaceutical companies, insecticide and genetic engineering companies and so on. They are less concerned with scientific truth than with profit, and in neoliberalism profit is the true measure of everything.

There are a few billionaires who run charities, like Bill Gates and George Soros, and a few tech billionaires who routinely get blamed for the crisis and for deep conspiracies. But the odd thing is that the billionaire class is generally not mentioned as a class, and most members are not named. The people who attack Gates and Soros, rarely attack Rupert Murdoch even though he is clearly political and heavily involved in determining contemporary policies and issuing propaganda. They don’t furiously attack Meg Whitman, Jim Justice, Bill Haslam, Silvio Berlusconi, Suleiman Kerimov, Gautam Adani, Clive Palmer, Gina Rinehart, Sheldon and Miriam Adelson, Tom Steyer, Tommy Hicks Jr, Harold Glenn Hamm, Charles Schwab, Paul Elliott Singer, Joe Ricketts, Betsy DeVos, Linda McMahon, or Charles Koch (founder of the Cato Institute, Americans for Prosperity Foundation, Freedom Partners and the Koch Network) just to give a few names directly involved in political influencing unlike Bill Gates. Most people probably do not know many other billionaire’s names as they stay out of the media. We can conclude that while the billionaire influence on politics is pronounced, the neoliberal denunciation is highly selective.

Then of course there are those people protesting against being shot by police. This is obviously such a vast and powerful conspiracy they can’t even get the police to stop killing them, and the Republicans can just ignore them as they have such little influence, and some Republicans can support people who shoot at them, or drive into them. Not much ability for masses of evil power there, even if a few statues do get toppled.

Then there are the socialists. Well the Right fusses about them, but I haven’t seen nationalisation, as opposed to privatisation, of an industry for quite a while. In the US getting a general basic wage that people can live on, has not happened, and does not seem to have much hope of success. The US can’t even get a health system which does not bankrupt sick poor people, no matter how much Trump promised he would fix it easily. Furthering control of government by the working classes rather than the corporate class seems to have failed all over the Western World. ‘Socialism’ seems generally used as a swear word, and calling some idea socialist is the supposed end of many arguments. Again this could not happen if socialists had any power.

Not surprisingly because the corporate sector control the media, ‘left wing’ thinking and action, is passively censored; it is hardly mentioned, other than by its opponents, who are not always that accurate in their descriptions. If you want to find out what the Greens stand for, for instance, then you have to go to the Greens, or perhaps approach some lonely person selling a weekly or monthly newspaper on a street corner. The Left does not control the mainstream media or normal talk, so this takes effort and most people cannot be bothered. Why would they be? they are constantly told the Left is evil and idiotic. To most people this is just the way things are, even if they think they have worked it out for themselves.

At the end of all this, we can see that according to neoliberals, the enemies of liberty are a few named billionaires (Gates and Soros) who don’t fully subscribe to neoliberal theory (the huge majority of billionaires can be ignored as they support the establishment, or at least don’t overtly attack it), a few largely disorganised protestors and a bundle of academics who have next to no power in a system devoted to promoting fake news. These people have little in common, other than being despised by neoliberal followers. They do not seem a plausible danger, and if they form a conspiracy it seems extremely badly run and powerless.

Conclusion

Comparing the two ideas, it seems to me, that the idea of neoliberal conspiracy easily wins the plausibility stakes.

Praxeology, Culture, Ecology

December 20, 2020

This post continues to explore the apparent lack of consideration given to context in the basic axioms of Austrian economics; in this case culture and ecology.

Not Recognising ‘Culture’

Discussing purposeful action, which is supposedly basic to the economy, Rothbard goes on to argue that a human must have certain ideas about how to achieve their ends. Without those ideas there is little in the way of complex human purpose.

However, this sidesteps the issue of where does this person get the ideas from, as well as the language to think about those ideas? The ideas are unlikely to be purely self-generated, with no precursors. In reality, ideas arise through interconnection with other people and previously existing ideas. This of course does not mean people never have original ideas, but without interacting with other people it is doubtful they would have complex ideas or language at all. Indeed, the people they interact with may have a massive influence on the ideas, and approaches, available to the person. Ideas are socially transmitted.

Even our individuality is based in the groups we have encountered, the ways we categorise our selves in relationship to others, and the child rearing we experience. It is not as if we are born fully conscious and evaluative, able to deduce everything all by ourselves from first principles….

However, in response to criticism, Rothbard states: “We do not at all assume, as some critics of economics have charged, that individuals are ‘atoms’ isolated from one another.”

  • (Note the way that his economics becomes all economics as opposed to ‘my economics’ or ‘our economics’).

Where is the evidence of this recognition in the initial axioms, from which all else is derived? Its certainly not clear to me that this recognition exists, other than to be wheeled in to get rid of objections. “You think people are isolated from each other” “No we don’t. I mention this in a footnote.” This recognition seems an add on – whereas it seems more likely that humans are both individual and collective from birth onwards. To some extent we can even say that humans have the capacity to learn to be individuals, to individuate, but it is not always easy.

I suspect that if we included culture’s (and social organisation’s) effects on exchange and economic action, then we might not be able to perform a supposed universal justification for capitalism, and its exemption from attempts to control it or regulate it to be less harmful. And this justification and protection, seems to be the purposeful action of Austrian economics from its beginning.

Ecologies

All action takes place within a web of actions – which is sometimes known as an ‘interactive network,’ or a ‘set of complex systems’ and sometimes, in Austrian economics, as a catallaxy, or as Hayek says “the order brought about by the mutual adjustment of many individual economies in a market.”

It is possible that, with this term, Hayek is pointing towards what is now known as “emergent order,” which involves far more than just ‘individual economies,’ adjusting in a ‘market’ – as markets cannot be separated from other processes, including social and ecological process which also adjust to each other.

While it is often assumed to be the case, it should be noted that the ‘order’ which emerges from a complex system or ‘catallaxy’, does not have to be hospitable to humans. Historically we can observer that the ecological order is often changed by humans disasterously and, as a result, humans can no longer flourish in those new ecological orders.

Sometimes this ecological collapse occurs because some form of behaviour which once helped survival has been intensified to a level at which it:

  1. becomes destructive,
  2. blocks information flow and perception of danger which challenges the behaviour, or
  3. simply prevents change through entrenched power.

Hayek’s formulation uses the cultural assumption that order is ‘good’ for humans, to imply the market always brings ‘good’ results, when it may not, even if the ‘order’ arises ‘spontaneously’.

Economies occur within general ecologies: they can be said to be context dependent. An impoverished ecology is likely to produce an impoverished economy for most people, even if the wealthy are very wealthy and well provided for.

  • [Rothbard uses the term ‘catallactics‘ to refer to the “the analysis of interpersonal exchange”, or “study of money exchanges” which do not seem to be quite the same things as not all interpersonal, or intergroup, exchange involves money, although it is interesting that Libertarian economics tries to reduce all exchange and interaction to money. Neither does this usage seem to refer to the same kind of process as Hayek’s catallaxy].

Rothbard states on page 4: “With reference to any given act, the environment external to the individual may be divided into two parts: those elements which he believes he cannot control and must leave unchanged, and those which he can alter (or rather, thinks he can alter) to arrive at his ends”.

Earlier he talks about rearranging elements of the environment…

All this suggests that Rothbard thinks of the environment as a largely passive backdrop to human action, not a participant in that action, or even likely to react to that action. The environment is portrayed as essentially passive or dead, or humanly controllable, neither of which seem to be the case. Again the aim seems to be to reduce everything to the human individual, who determines what is to be done.

The approach not only does not recognise the importance of groups but appears to be anti-ecological, or anti the recognition of the necessity, and force, of ecological processes. This could be accidental, but perhaps it occurs because neoliberalism grew up to be anti-ecological in the roots of its thinking (thinking that humans are detached from each other and the world), perhaps because social movements recognising the importance of ecologies were seen as a threat to corporate profit and liberty, or perhaps it is just their overconfidence in the culturally backed idea of human specialness and isolation.

Rothbards adds that acts involve means, and this involve technological ideas. Both true, but forms of government and organisation can also be thought of as technologies. It is easier to hunt with hand weapons if we organise to hunt together, and use strategy and planning in that hunt.

“In the external environment, the general conditions cannot be the objects of any human action; only the means can be employed in action.”

I’m not sure what this means, but it seems to be suggesting that we cannot work with environments….

However, economies are enmeshed in environments. Economies do not exist without ecologies and, at the moment, without naturally livable ecologies. (Possibly in the future large numbers of humans may be able to live in purely constructed environments, but not now).

We have to grow food, we have to survive climate, we have to survive in the atmosphere, we need drinkable water, we need ‘raw materials’, we need energy supplies (more than just food and water if we are going to survive with any technological complexity). We need functional waste recycling systems and pollution processing, and so on.

If ecologies are destroyed then economies are highly likely to collapse, and in any case the aim of the economy becomes reduced to survival, and radically simplifies. Social support and social action is still vitally important.

Economies are also enmeshed in environments of social and political life, as people attempt to use rhetoric and persuasion and sometimes violence to protect their markets, regulate and structure the markets and so on. Wealth, earned on markets, gives power and that power is used to ensconce and intensify the position of the wealthy. At the least, all economies are political economies, in the sense that economic action involves politics and vice versa.

It seems to be the case, that extracting something called an economy from both social and ecological life, is a massive and probably dangerous over-simplification.

More Accurate Foundations

In these last two posts on praxeology, I have implied you cannot ignore history or social studies to formulate a study of economics, because that forms the conscious (or unconscious) data you draw your a prioris from. I’m not asserting that a prioris of any kind do not exist, they may, but it seems unlikely that social science a prioris exist, and that the a prioris of Austrian economics are inadequate and dependent upon unacknowledged (or unconscious) cultural foundations.

Let us reformulate the initial propositions as simply as possible, from the discussion above.

  • Human action is defined simply as purposeful behavior.
  • Purposeful action almost always involves humans acting with or against other humans, human groups, and environments – often several at the same time.
  • Most human motives and means are learnt from, with, or against, other humans and the environment (often through trial and error).
  • Purposeful action often involves trying to influence, or sway, other people’s action and/or gain approval in some other humans’ eyes.
  • People are not always aware of the origins of their purposeful action – they can be unaware of their true purpose.
  • Human action normally results in unintended consequences.
  • What we interpret as disorder is as normal as what we interpret as order, and vice versa
  • Human being is social. People act in groups all the time, and belong to groups. Without some group backing, most humans would die when young. It may be easy to say people are individuals but it is not entirely correct, and so will take us to incorrect conclusions.
  • A group acting together is not just the sum of the individuals acting – this is one reason why humans act together.
  • Human groups tend to regulate, or govern, themselves, so as to act together. They team up to achieve individual and group objectives – which may just include company and conversation, or it may include world conquest, acquiring new resources through violence, teaming up to get governmental policy which favours the group, overthrowing the state or the lack of a State and so on.
  • Government is normal. Corporations and business involve forms of government both ‘internally’ (in relation to themselves) and ‘externally’ (in relation to the government of others). Like other forms of government, they can use threats and violence.
  • Corporations and businesses may attempt to influence the government of others.
  • Market action involves politics, persuasion and building of trust – it is based in social life.
  • Markets involve interaction with ecologies for food and resources. They can destroy the ecologies they require to function. The orders which arise from market/ecology interaction can be hostile to humans. That is, markets can suffer from unintended consequences. It is magic to expect that the order which emerges will always be ‘good’.
  • Interpretations of other people’s actions and ideas, can be false, but are generally based on cultural expectations. Economics is a tool of interpretation
  • Economics cannot be isolated from social, political, ethical, and ecological life.
  • Economic functioning depends on social and ecological functioning.

Praxeology as Purposeful Politics?

December 20, 2020

This post starts to look at praxeology as politics, with the hope of making some more accurate starting points in a second post about the left out background of Austrian economics. In these two posts, I move on from Mises to the first few pages of Murray Rothbard’s Man Economy and State – to show that Mises was not an aberration.

Human Purpose

On page 1 Rothbard begins his recapitulation of Austrian praxeology by stating: “Human action is defined simply as purposeful behavior”.

We probably should add, as necessary and fundamental and relatively well known, that the purpose can, but may not, have much to do with the result. The world is not easy to control (which is a point free market people often make), although people do often attempt to control it. We cannot deny attempts at control exist and are normal or routine, and that they often fail or apparently make things worse.

Unintended consequences are normal.

If people do have unconscious processes, then they may well be unaware of the real purpose behind their action, and suggest something socially appropriate instead as their purpose, as can happen with post-hypnotic suggestion.

A purpose may include targets such to make more profit, or to control the market (or people in the market), as well as possible. Purposiveness can also include lying, or mistaken ideas.

People often have the purpose of trying to influence, or sway, other people’s behaviour – which is one mode of attempting control.

Markets also involve the building of trust and connection, as the more likely people feel connection and trust the more likely they will purchase, and pay back. So markets involve purposive social action.

Everyone may know these factors already, but let us put them up front.

Interpretation

“Human action… can be meaningfully interpreted by other men.” The interpretation by those “other men” does not have to be correct, but there will be some shared (although not uniform) cultural ways of interpreting behaviour, and similarly shared, but not uniform, expectations about human behaviour, which people can use to make interpretations.

Different people, in different groups, may interpret observed behaviour differently. This is clearly observable in the way different groups interpret Donald Trump’s behaviour. Some people almost always excuse it, say he is doing wonderful things, that his statements are not literal (or are aimed at owning liberals) or claim that much of the information about him is fake news, and some people see the behaviour as constituting a selection of abominable, corrupt, incompetent, conflictual and self-seeking or self-pleasuring behaviour.

Is it possible to suggest people respond to their interpretation of other’s behaviour more than they react to the behaviour itself? Economics (amongst other ideas), provides tools for interpreting human behaviour and human actions. Inadequate tools will probably produce inadequate interpretations, and the strategic ignorance of certain facts. As such economics can risk becoming a part of political rhetoric, rather than a quest for testable knowledge – especially when it denies that its axioms need no testing for accuracy.

So, do we understand these processes of purpose and interpretation properly, and apply them to what we are doing, or do we pretend we always have direct, and unmediated, access to truth?

Individuals and Groups

Means and motives, are not purely individual constructions. They may well be culturally specified, or limited. People are ‘thrown’ into an environment not entirely of their own making, or resulting from forethought. This is important. Not everyone may want to make a fortune, or be able to make one, and that realisation is probably needed for some kinds of economic analysis. It is unclear what ‘profit’ might mean to everyone, and I suspect that Austrian economics would admit that, but make it secondary.

Economic actions blend into other actions.

Rothbard tells us the “fundamental truth” of Praxeology is that people act. Fair enough. However, this statement that people act, is then shifted into a more dubious proposition.

“The first truth to be discovered about human action is that it can be undertaken only by individual ‘actors.’ Only individuals have ends and can act to attain them.”

Indeed individual actors can and do act. People can act to undermine the groups they belong to. No question of that. But can we really dismiss social groups, and the social background, as of no fundamental, or a priori, importance?

Do groups of people never decide to act together for certain ends? The answer to that would seem to be ‘Yes. It happens all the time.’

Recognising that people make decisions in groups, and act together, does not mean that everyone is necessarily submerged in some kind of immaterial group mind, or that people think the same thing and have the same abilities. Or that individuals always get pushed into doing things. It means they cooperated, and supported each other, to a degree. Neither does it mean that people only belong in the one group at the one time….

On page 3 Rothbard asserts “‘groups’ have no independent existence aside from the actions of their individual members.” Yet the coordination of groups gives the possibility of an effect greater than the sum of its parts, and which sometimes changes the possibility of action considerably. Indeed the reason why people act together is known to Mises; acting together has the potential to produce greater effects, or even previously impossible effects. The buzz term nowadays is ‘synergy.’

Groups also can have existence beyond individuals. Groups frequently continue to exist, or manage to maintain some kind of continuity and identity, despite an ongoing slow and complete change of membership. If a group is just individuals, then this happening should probably not be quite as common as it appears to be.

It is commonly remarked that people do ‘bad actions’ when in groups they may not have done alone. If so, then the group is changing their behaviour; the individual’s action may go into a different ‘dynamic’, or the groups produces different motives and means of action for individuals.

A useful and relatively accurate economics should probably involve the study of some of these group effects and group dynamics, as well as individual effects and dynamics.

It would seem to be a possible a priori that humans are both based in groups and individuality, so the analysis needs to go in both directions, to groups and to individuals.

Purposeful behaviour almost always involves humans acting with or against other humans, human groups, and environments – often several at the same time.

As said earlier, studying this bifold nature of action (individual and collective), is often difficult to analyse of describe, but difficulty does not mean that the fact is not real, or should be abandoned at the base of analysis.

Politics?

It seems to be that the idea of Austrian economics, is to eliminate consideration of these complex effects, on the grounds that simplification is not just distortion, and that the complex effects and uncertainties can be explained purely through considering simple units in combination.

The political consequences of this step just happen to favour corporate and business groups, by ‘pure accident’ (actually this political consequence will probably be denied).

I suspect that one idea underlying all of this apparently oddly deficient thinking, is to make formal ‘government’ something unnatural, rather than something people do all the time.

As implied above, many groups exist with some kind of decision making process. They have some expectations of loyalty, some purposes, some social control? Probably most – especially those important to an individual.

Corporation and businesses rarely exist without some mode of organisation, and some mode of government. They have ways of making decisions about action, about what people lower down the hierarchy should do, about motives, about ends that affects the individuals involved which may change those individuals.

Indeed, I cannot remember ever seeing a free market person, no matter how hostile to government, who objects to a corporations governing its members – even if there is not the slightest attempt at democracy or representation.

Teaming up amongst the lower orders is to be discouraged, especially if it is team-up against the true elites, while it appears that team-ups amongst the hyper-wealthy is to be ignored, or blamed on ‘the government’ which is defined as having nothing to do with, or no dependence on, those hyper-wealthy people and their organisations.

Attempts at organising to achieve group and individual ends seem pretty fundamental, and it is questionable if the effects of this organising can always be reduced simply to individual motives.

The proposition that groups can be methodologically (?) reduced to individuals has the function of making it non normative for people to think of teaming up together to combat the real power of corporations, as all ‘real ethical people’ are pure individuals – even the corporation is just individuals and does not exist, and it has no drives of its own.

This psuedo individualism allows a person who goes along with neoliberalism to think they are proudly individual by going along with it – which in Rothbard’s society is great praise. “I’m an individual because I’m a free market person.”

We could hypothesise that people who believe people are naturally self focused, or have a limited range of sympathy (say limited to their family) might tend to behave more selfishly like they think everyone else does. It becomes a mode of interpreting what others do, which is self reinforcing. Given these assumptions, we have to defend against the self-focus of others, and can’t expect help from others in our groups.

This brings forward the issue that by prescribing how people act, economics is also making ethical claims as to how people should act. It is becoming a primarily political tool. I’d expect all social theory to act as a political tool, as well as a tool for understanding, but it should probably not deny this, as it should not begin by lying, and it should not make lying its end – the end is to be as realistic as possible. But, as ethical statements, these point have no, or carry no, compulsion.

Thus Austrian economics claims people should act as individuals, should shun government, and should leave life to both the market and those who attempt to control the market to benefit the corporate business sector. Established profit is the only good. People who fail, in a free market, are inadequate and deserve only what they get. People who help other people for no return are stupid or corrupting those people, so it should not happen. Free markets do not emphasise virtue, just abstinence from protest. That appears to be the Austrian ethical life.

It might be a bone fide political or ethical objective to convince people that they are individuals living purely in contractual agreements (even if they have never agreed to a contract in their lives), but it is not necessarily descriptive of a priori ‘human nature’. It is also a political act, so it is situated in relationship to other people from the beginning.

We would expect the neoliberal abolition of the recognition of groups as a basic form of life, would mean that they would disapprove of corporate personhood, and the effective diffusion of responsibility in corporations. That is, they should insist it is not the corporation which makes decisions and which takes responsibility, but individuals; from the deciders in management, or on the board of directors, to the people who carry out the instructions, and to the shareholders who provided the capital and who aim to profit from the companies decisions. If a company commits harm, then people should not be able to hide behind the company, or the excuse of obeying orders. They are, and should be, responsible for their actions, and be held to account. However, as we cannot ignore the company structure, the higher the management that approved the action, or ignored the action, then the more responsible the people should be.

I personally do not know what the free marketeer position on this matter is, at the moment. Hopefully I will find out. If the movement is primarily about benefitting corporate power, then it will protect those who benefit from that power and wealth, and shift responsibility away from them, or downwards, perhaps even to those who are hurt or harmed.

Ignoring voluntary and compelled co-operation between people might lead to as fundamentally a wrong set of assumptions and governance, as those which ignored voluntary (and compelled) competition.

Conclusion

Ignoring the power of groups, the basis of human life in social groups, and reducing human life through methodological individualism does help simplicity, but it does not help accuracy. We have to be aware of the background to the existence of individual action if we want to understand a collective process like the economy or social life.

In the next post I will further discuss the missing social and ecological background in more detail, and then propose some new starting points.

Some questions about markets

December 15, 2020

This is a continuation of the previous post on ‘Praxeology’. But its self-sufficient, you don’t have to read the other post.

This post is just a series of questions about markets to those who believe in the possible existence of ‘free markets’ and the virtues of corporate ‘free markets’. The indented parts are usually comments on the questions.

Questions

Does wealth give power? Does this power increase with increasing inequalities of wealth?

  • If people have less wealth it could seem they have less power and less ability to influence others, or buy the services of others.
  • Great wealth is one of the things that gives States power.

Does capitalism magnify differences in wealth? Does it lead to accumulation of differences in wealth? [Perhaps due to inheritance laws?]

  • Are there systems which act to prevent accumulating differences in wealth?

Do wealthy people and businesses normally team up to get even more co-ordinated power and market control?

  • As far as I can see, the corporation has its origin in this capacity of people to team up to support individual and collective interests. If people were just ‘isolated individuals’ then we would not have corporations, or families, etc.
  • States could likewise originate in both team ups and fractures.

Do some corporations currently have assets and resources greater than some countries?

  • Are corporations are as big and powerful as some States?

Do corporations and wealthy people get priority access to politicians and government, to put their views on how governments should behave?

  • Is there a form of ‘government’ in which other people might get priority of access?

Does wealth buy lobbyists, whose job is to influence government policies?

  • and who sometimes end up running government departments?

Does wealth enable the wealthy to buy politicians through donations of money and labour to the campaigns of those politicians, or by promising well paid easy jobs to them after they retire from politics?

Does wealth allow people to fund the semblance of political activity, and give a false impression of what is popular?

  • Astro-turfing, push polling, bought trolling and votes etc.

Do Big business and government naturally ally? Who is likely to be dominant and under what circumstances?

Does wealth buy positive ‘information’ through the funding of think tanks, or university research centres, which primarily exist to justify ideology and research which supports the interests of wealth?

  • A think tank is never surprising. It is run on the market principle of giving the backers what they want, to continue to get being paid.

Do corporate lobbyists make use of this think tank information to influence the ways that people and politicians see and understand the world?

  • Hypothesis. Information whether true, false, or partial, influences the way people seek to act in the world. If you control the information a person accepts then you have some control over how they act, and what they will support. Rhetoric, or the art of persuasion, is not a minor consideration in social life. It is nearly always present in communication.
  • States also frequently try to control the means of information and the content of information.

Have corporations acted as major sponsors of ‘free market’ thinking since the 1930s, and can we hypothesise that one reason is because they find it useful to help maintain their power?

Do wealthy people and corporations own and control media (large and small), and hence control the information that the media circulates, does not circulate?

  • Does this create what passes for common sense and ethical behaviour?

Does wealth buy the law? Not just which laws that get passed by the government, but the actual legal process itself and the lawyers to execute it, making taking on a corporation way too expensive for most ordinary people?

  • It seems hard to challenge a corporation in law. It could be even harder to imagine how you would challenge a corporation without law and a State to enforce it.
  • Obviously States can also try to own and control the law for their own convenience.

Do corporations often have mobility which enables them to set up wherever the conditions are best for them, and thus have States bidding for their presence, by lowering demands or regulations on those corporations?

  • This seems well demonstrated to me.
  • States are rarely that motile. Most people who can leave a State’s area of land, will be left alone by that State, but not always.

Do small States, imply that people can probably make less resistance against corporate power, by attempting to take control of the State?

How do people control a corporation without being able to purchase heaps of shares? ie do wealthy people and organisations end up being the only ones who can have impactful input into a corporation?

Does wealth allow people to buy violence, organised or otherwise?

  • People can make money from being mercenaries. We can also think of the East India Company, the Opium war, and the dispossession of indigenous people by business, which seems to imply violence could become a normal part of trade, or of setting up points of trade.
  • States also usually try to gain the power of organised violence.

Do jobs (which are the mainstream way of surviving in capitalism) usually involve submission to the employer, and therefore not encourage liberty in daily life?

Who constrains your daily life more, your boss or your government?

Are jobs a cost, so that it is in the apparent interest of any particular corporation to lower that cost, or dispose of jobs, to increase profit?

Does death or sickness from pollution tend to be distributed to poorer areas of the country or the world?

Is this distribution of pollution affected by the corporate advocacy for laws, and buying of laws, which enable them to pollute or suffer no consequences from making pollution and poisoning people and environments?

Is not polluting and not destroying those environments subject to extraction a cost, so that it is logically in the interest of any particular corporation to lower that cost and increase pollution and destruction?

Does liberty for the wealthy ever impinge on the liberty of the less wealthy, because of inequalities of power and resources?

Given the inequalities of wealth, power and survival is it possible that all exchange in a capitalist market is inevitably voluntary and equally satisfying for all participants?

Do corporations and the wealthy try and engineer the existence of governments that will allow them to structure the market to help them survive and prosper?

Do corporations aim to get taxpayer subsidies, if they are doing badly for some reason?

Is all trade the same as corporate capitalism?

  • If not, in what ways do they differ?

Is corporate monopoly bad? If not why not?

  • Does free market theory end up supporting monopoly and more corporate power?

Is corporate planning bad?

  • If corporate planning is not bad, then why is government planning bad?

Do corporations not care about ordinary people, or the so called ‘90%’?

  • Should anything make them care?

Does capitalism need a State to enforce property rights, hierarchies, wealth inequalities, contract, law, favourable order, labour and so on?

  • If so, then corporate capitalism will never not have a State which exists to support it, help it, and be taken over by the wealthy.

Is it likely that hyper-wealthy people will team up to set up states, to protect their perceived interests?

Do corporations, themselves, involve government over participants, power differentials, formal organisation, planning, internal economic transactions and so on?

  • It seems that businesses can resemble States, without a necessary basis in a country.

Can you tell me any basis of Government power which is not also possessed by the corporate sector as a whole, or by a corporation?

  • It seems to me, that if you object to governments then you should object to corporations, or at least to corporations over a certain size.
  • Corporations may fail, but so may governments. It does not necessarily change the system, or bring liberty.

Conclusion

If people continue to support free markets, which is their right of course, I would just ask them to consider the high probability that free markets are not free, and are never going to remain free, while we have vast inequalities of wealth, and while we have corporate forms of organisation and planning.

It seems plausible, that when we have these forms of organisation being dominant, then we have the possibility of a growing tyranny of wealth or plutocracy. Under those circumstances, the demand for free markets seems to be largely a demand to get out of the way of corporate and wealth power and action, and to be subject to that power and action.

If anyone really wants free markets then we probably have to start from scratch, not only destroying the State, but destroying the power of the mini-State, which makes up the corporation, and the plutocracy which makes States. If we don’t do that then it seems probable that we will just get increasing power of the wealth elites, and their liberty will remove your own.

No neoliberal is ever going to suggest that corporations are as deadly to liberty as States, because the whole function of their argument is an attempt to increase corporate power and plutocracy.

Free markets? Praxeology? Individualism?

December 15, 2020

This blog post is an attempted contribution to Mises’ Praxeology, because the questions I’m going to ask in the next blog post, lead to observations which seem to contradict those of Austrian ‘free market’ economics.

Praxeology

Praxeology is the study of what the ‘Austrian’ form of economics considers to be those aspects of human action that can be grasped a priori, or which seem immediately obvious without any further testing or exploration. The idea is that anything we deduce, or derive, from these axioms has as much truth as the original axioms. As we have assumed the original axioms are obviously true then the derivations must also be true.

However, if the axioms are incorrect or incomplete, then propositions which have been derived from them, will (at best) be misleading.

I am extremely dubious that we can simply take apparently obvious axioms about human nature as true, without investigating them. Anthropology repeatedly shows that different societies have different ideas of what is normal human behaviour, so it is probable that what seems normal and obvious to a person is most likely a cultural phenomena, reinforced by their society and not necessarily true for all (culture can be mistaken, biased or limiting). However, to Mises, historical and anthropological research are irrelevant to understanding human dynamics and functioning. He argues that Praxeology’s axioms:

are, like those of logic and mathematics, a priori. They are not subject to verification or falsification on the ground of experience and facts. They are both logically and temporally antecedent to any comprehension of historical facts.

Mises 1998 (original 1949) Human Action: A Treatise on Economics. Mises Institute p 32

I’m not quite sure how any person’s axioms about human nature, can be ‘temporarily antecedent’ to their knowledge and experience. The simple fact would seem to be, that by the time we get to thinking we can deduce everything important about a subject from obvious axioms correctly without error in the deduction process, we have done a lot of learning, and had a lot of enculturation.

That these axioms are not falsifiable, or verifiable, is of course handy for producing dogma, but not as handy for finding truth. Heading towards even relatively accurate understanding takes work and testing. The beginning point of Mises Praxeology simply seems lazy. It is at least likely our learnt knowledge of history and our cultural expectations, lead us to consider some propositions about human nature as being obvious when they are not.

The point seems to be that Austrian economics should not ever be tested, unlike a normal science, where you change the theory if the evidence shows it is not correct. As Austrian Economics is based on a priori truths, then no amount of evidence can ever show it is wrong. It is essentially a dogma. We should probably be skeptical of his assumptions.

We may need to know what histories we are taking as true, to understand what axioms we might take as true.

A theory should be logical or derivable and systematic but, if we want accuracy or truth, we should be able to abandon the theory, if the evidence does not support it, otherwise we are just heading for a beautiful delusion.

He implies that the assumptions of mathematics are a priori as well, independent of our experience of the world. I’m skeptical about that proposition as well. However, we do know that you can get quite interesting results by challenging the apparently obvious axioms of mathematics, and that some of the new mathematics that has resulted is useful for analysing real world situations which were previously resistant to mathematical description. Non obvious, non a priori formulations, such as irrational numbers, imaginary numbers, non-Euclidian geometry and so on, should have been familiar to Mises. Non-obvious multi-valued Logics were being explored in the 1920s and 30s. We can assume he was not inevitably going to be familiar with these, but that does not mean they do not exist, and do not contradict his point. What seems to be obvious can be wrong, or just a special case. We would hope no one would make a similar mistake today, but who knows? It can be easier to make that mistake, or there can be other incentives to make it, because we have already decided what our ‘science’ is aimed at.

Mises states Praxeology‘s:

scope is human action as such, irrespective of all environmental, accidental, and individual circumstances of the concrete acts.

Mises 1998 (original 1949) Human Action: A Treatise on Economics. Mises Institute p 32

For me, one of the problems with this form of immediately obvious human action, is that it appears to deny interaction, when that seems basic to human action. That is, human action almost automatically involves interaction with something else. I wonder if human action can be extracted from all environmental, accidental, and individual circumstances? Surely we act, at least in part, because we are reacting to circumstances and the properties of the environment we find ourselves within? We are nearly always reacting to, or with, other people for one. For instance, in reading Mises, we are reacting to Mises – that is one relevant circumstance. In an economy we are reacting to what is happening elsewhere. It could be argued that we develop our sense of self, or our ego, through our interaction with the world (including people), and through learning the ways the world resists us and the ways it supports us.

Mises proposition takes advantage of the historical Western neglect of environment and interaction. This would seem not to be an a priori truth, but a historical/cultural assumption. Other people do not have to make that assumption.

Mises justifies his approach by what he calls “methodological individualism”.

Praxeology deals with the actions of individual men. It is only in the further course of its inquiries that cognition of human cooperation is attained and social action is treated as a special case of the more universal category of human action as such.

Mises 1998 (original 1949) Human Action: A Treatise on Economics. Mises Institute p 42.

He recognises there are problems with this, but simply brushes them to one side.

As a thinking and acting being[,] man emerges from his prehuman existence already as a social being. The evolution of reason, language, and cooperation is the outcome of the same process; they were inseparably and necessarily linked together. But this process took place in individuals. It consisted in changes in the behavior of individuals. There is no other substance in which it occurred than the individuals. There is no substratum of society other than the actions of individuals.

Mises 1998 (original 1949) Human Action: A Treatise on Economics. Mises Institute p 43.

This is an odd conclusion from the obvious recognition that humans emerge from “prehuman existence already as a social being.” If this is correct, which seems to be the case, then methodological individualism seems to be a distortion of reality. It could be an acceptable distortion if it leads to testable results, but it is certainly not a priori not matter how convenient it is.

Evolution does not seem to take place in individuals, but in reproduction, which requires at least two people. Evolution and human action, almost always occur in interactions; with other people, with other animals, with plants, with soils, with water, with climate, with weather, with microbes etc. The child learns from its parents, others and its conditions of life. If its genes and experience give it an advantage, it may flourish and reproduce. If its genes and do not give it an advantage or harm it, then it may not flourish and reproduce. It could be an evolutionary dead end, without some other factor. Perhaps it has helped its group flourish and reproduce, by discovering useful things, and thus its genes may get passed on indirectly. In which case again, evolution is not individual.

It would seem that humans are social and interactive beings, and this is not secondary, or to be dismissed out of hand.

This interactivity, leads to the apparent fact that societies and groups do not have firm boundaries, and that people can belong to intersecting and different groups. This is a probable difficulty, but it is a difficulty which has to be faced, rather than avoided. This issue is, as Mises implies before dismissing the problem, normal for humans. It is as obvious as it gets.

He also asserts that the meaning of a crowd “is always the meaning of individuals” (Human Action p 43). But it is not. A collection of interacting humans may not always have the effects each individual member has attributed to the gathering. Social action, or interaction, often has effects unintended by any of the participants. That is also observable and important to human life. Human action may be absolutely involved with attempts to reduce, or take advantage of, the ongoing production of unintended consequences.

Let us note that people who classify themselves as being similar, often co-operate to advance their individual and group interests, and that this has a potentially large economic effect, and is a normal part of human life.

In other words, despite Mises’ claims, we almost never have isolated individuals. We have functional human individuals who exist because of their previous interactions with, co-operations with, conflicts with, and learning from other people and the world. No one is normally a blank slate of desires and instincts, completely free to act through their own uninfluenced reflection. Indeed, it seems an immediately obvious proposition that humans are social, and learning creatures, and would not survive childhood on their own. There are other axioms which seem equally immediately obvious to me, and worthy of research.

As it is popular, we might instance the South African Zulu or Xhosa phrase “Umuntu ngumuntu ngabantu”, usually abridged as ‘ubuntu’. This is also apparently ‘obvious’. It means something like ‘a person is a person through other people’, or ‘I am a person through other people’ or ‘I am who I am because of who we all are’. Archbishop Desmond Tutu glosses it as “none of us came into the world on our own.” Even if we were abandoned, we came into a social world. He also points out that being alone is a terrible burden for most humans, they ‘shrivel’, and that a lone child will not develop as well as they might.

For many southern African intellectuals, communion or harmony consists of identifying with and exhibiting solidarity towards others, in other words, enjoying a sense of togetherness, cooperating and helping people – out of sympathy and for their own sake.

Tutu sums up his understanding of how to exhibit ubuntu as:

I participate, I share.

Thaddeus Metz What Archbishop Tutu’s ubuntu credo teaches the world about justice and harmony. The Conversation 4 October 2017

We can accept the proposition that people emerge within a web of other people, as an a priori, and even as a realisation which may build virtue and contentment, but also (at the same time) recognise that humans often tend to be conflictual and selfish – we are both co-operative and competitive. In other words the morality could be up to us, but the recognition of interdependence is not up to us, it just is. Like the Buddhist idea that everything in existence exists because other beings exist, and individual being cannot be extracted from those other existence(s). Everything is interconnected, and everything affects everyone, and this is fundamental.

So let us be clear Mises is starting with the axiom that humans are isolated individuals, not necessarily because it is obvious, or a priori, but perhaps because it appears easy and it seems to be a convenient proposition from which to make the arguments he wants to make.

Given this methodological individualism involves an axiom, or procedure, which could seem a priori incorrect or incomplete, then we could expect that statements derived from it will also be incorrect or incomplete.

So this contribution to Praxeology just begins with questions to Austrians, or free market supporters – because I don’t know the answers. The questions are in the next blog post, to make this a bit shorter than usual.

Fossil Fuel Fascism

December 11, 2020

People often seem to talk as if some form of democracy was inherent in the future, whether it is based the current neoliberal form of energy use, or whether it becomes based in renewable decentralised energy. There is no necessity for this assumption. It is probably more accurate, and analytically useful, to assume the politics of transition will be complicated.

The Right, Climate & Ecology

Rightwing politics, and in particular right wing authoritarianism is often tied in with climate denial, postponement of climate action, support for ecological destruction and support for fossil fuels. They will not even accept that their sacred market seems to be in favour of renewables, they just plough taxpayers money into fossil fuels, and try and inhibit development of renewable energy through regulation and legislation. They also repeal regulation that stops ecological destruction. Conservative politics in the UK and Germany, can assume that conservation is possible, while the supposed Left in the English Speaking world (ie the Democrats, Labour and Labor), are less hostile to climate action but are still rarely pro-active. In Australia climate action can be joined to support for coal which endangers limited and precarious water supplies for major cities, and the Labor party can support the Narrabri coal seam gas project, and coal for export. It risks much less powerful opposition from the mining sector.

It would appear that many people think neoliberal capitalism cannot survive without its modes of pollution and destruction, or even if those modes of pollution and destruction are restrained. For them, capitalism is about liberty (even if that liberty, in practice, is limited to the wealth elites), and that includes the liberty to destroy, which appears to be the basis of the other liberties, as is the classic capitalist view of property (if something is yours you can destroy it with complete liberty). That would appear to justify a liberty to suppress others, who object to the destruction.

The neoliberal Right is not consistent about this. They sometime claim a care for the environment. Trump is well capable of saying he has produced the best air and the best water, [1] (although he seems to have had little to nothing to do with it), and that he wants to lower emissions, while removing nearly all boundaries and penalties for polluting and destroying, opening national monuments and national parks for drilling and destruction and shoveling taxpayers’ money to fossil fuel companies to keep them buoyant – especially during the Covid Crisis and the oil shock of early 2020. After the election he rushed to confirm the opening of the Arctic national wildlife refuge in Alaska to drilling for oil and gas [2], [3], as part of “advancing this administration’s policy of energy independence.”

Trump implies that you can have both rampant ecological destruction and a good ecological result, which could be a pleasant fantasy. However, more consistent thinkers have put forward a similar view, saying that capitalist countries tend to have gained cleaner environments over the years, and suggesting that only people who are financially prosperous can afford environmental care [4], [5], [6], [7], [8]. The problem is that even if this is true, then do we have the time for it to work all over the world? and do we advance this movement by opening more land and country to destruction? Especially when the destruction is easily concealed?

There is also the possibility that, like many other risks, the risks of climate change are not equally distributed and will hit the poor and racially vilified first. Racism could be built into the current system, and not likely to be unwound deliberately. Apparently:

A disproportionately high number of poor and non-white people live in the hottest neighborhoods across the [USA]. It’s often the result of discriminatory practices by banks and local governments.

Climate racism is real. Researchers found it in U.S. cities

The other right wing approach to ecological protection is simple and based in a similar kind of discrimination. They suggest that there should be less population elsewhere in the world. It is the poorer countries who are to blame, not the wealthier ones.

However, between 1990 and 2015:

The richest one percent of the world’s population [were] responsible for more than twice as much carbon pollution as the 3.1 billion people who made up the poorest half of humanity during a critical 25-year period of unprecedented emissions growth…

The richest 10 percent accounted for over half (52 percent) of the emissions added to the atmosphere between 1990 and 2015. The richest one percent were responsible for 15 percent of emissions during this time – more than all the citizens of the EU and more than twice that of the poorest half of humanity (7 percent).

Carbon emissions of richest 1 percent more than double the emissions of the poorest half of humanity. Oxfam, 21st September 2020

The argument about poor populations being the problem, is often joined with an attempt to reinforce borders and keep out refugees, because they supposedly spread the problem, producing ecological destruction because of their rampant preproduction, poor origins, or foreignness – the foreignness is part of the pollution of the national purity. The nationalist authoritarians don’t have to do anything in their own countries, except keep people out, no matter how much pollution those countries issue.

One US mass murderer is supposed to have written, mixed up with attacks on ‘migrants’: “If we can get rid of enough people, then our way of life can become more sustainable” [9], [10]. This kind of attitude is likely to become more prevalent the more that climate refugees become common.

Like many contemporary conspiracy theories, this population argument deflects attention from the normal action of the wealth elites, and the corporate sector, with their unsustainable and destructive consumption, extraction and pollution, and puts the burden on people who individually, or even collectively, do very little damage and have very little power. In the US, it has been indigenous people who have been resisting fossil fuel pipelines, and who face the penalties of action, sometimes enforced by police and troops and sometimes by private military contractors (mercenaries).

Discounting the extremism, from my experience, the reality seems to be that many people think that by opposing climate action, and by supporting fossil fuels, or dawning imaginary technology (without use having to change anything, including power relations), they are supporting prosperity and liberty, and moving against potential tyranny, and that authoritarian tactics are sometimes necessary – especially against outgroups such as native Americans.

This move does not seem to be declining. The Left, such as it is, has to face up to the fact that there has been no boom in Left voting, and little acceptance of Left ‘common sense’, over the last 20 years. Trump increased his vote considerably, despite all his failures and despite the Covid deaths. Morrison won his miracle election, and shows no sign of being able to lose the next. Boris Johnson won. Bolsonaro won. Modi won and so on… While Greens in Australia occasionally increase their representation, so do One Nation and the Shooters and Fishers Party; there is no likelihood of a Greens government at either State or Federal level.

The anti-fossil fuel movement is not like the anti-nuclear movement, in terms of its effects or popularity. This is despite what can be considered ‘elite’ defunding and divestment movements – you have to be reasonably elite to own shares and attend corporate meetings. Likewise, no current international agreement is strong enough to prevent dangerous climate change – and action seems resisted, despite UN exhortations (it hints at the loss of some national sovereignty, for the global good).

Liberty and Energy

There is a sense the Right could be partly correct about fossil fuels. Available Energy does give freedom and capacity, and renewables simply don’t produce similar availability to fossil fuels as yet, and probably never will. Fossil fuels do increase capacity, but with cost to other people and the environment, which is primarily a problem if theses issues are counted, or if you wonder about the destruction resulting from climate change in the future. If you discount the unintended side effects, then in the present, fossil fuels could easily be thought to generate new jobs, and jobs generate the only liberty capitalism allows, namely consumption.

Fossil fuels have also allowed production of the energy, steel, transport and weaponry needed for conquest, extraction of resources and control over cheap labour, and the imposition of stability. Fossil fuels allowed the world wars and truly massive violence, which ties together with the authoritarian project. What do you do with all the people you have encouraged to be violent, when there is little violence to use at home?

Energy transition also requires excess energy, or excess pollution, to produce the new sources of generation in quantity. This is a further incentive to open more coal.

On the other hand, renewables do possibly break down centralised energy generation and allow people to make their own energy, independent of the corporate structure – but that form of energy is not widely promoted, and most renewables (at scale) are installed by standard neoliberal processes with non-consultation, non-care for the environment, and non-care for workers. They do not generate community involvement or enthusiasm when built that way.

The connection of the possibility of new forms of liberty with small scale energy generation is not obvious, and it may not happen, because capitalism appears to need, and profit from, large scale energy generation, and large scale is more likely to produce simple and stable pricing structures.

If Mitchell’s argument is correct, that modern democracy grew with coal, and the capacity of coal workers to hold the country to ransom and demonstrate workers’ power, then the abolition of coal based energy may indeed mean the end of that democracy, unless we approach transition with care.

Autonomism and renewable energy

The Autonomists argued that there was a process of interaction between workers and bosses in the use of technology. Bosses would introduce technology to control workers and to extract more labour, and workers would respond by finding ways to play the technology, take over the technology, control the technology, steal bits of the technology, or use the technology for their own purposes – “the street has its own uses for things” to quote William Gibson. Then the bosses would respond to worker’s creativity by trying out new technologies, and new processes of discipline, and so it went on for cycle after cycle.

The processes are more confused than this skeleton suggests because technologies have unintended consequences, which might end up producing new social results – as for example when workers have to develop ‘work arounds’ and an organisation around those work-arounds, to actually do the job they are expected to do, and which the technology no longer allows them to do. However, the point is there is a place for workers to insert power and creativity.

This is inherent in Mitchell’s argument mentioned above. The bosses’ energy technology used for the factories, disciplining labour and making it mindless and perfectly replicable, could be commandeered against the bosses, to extract concessions for workers in general.

The problem with renewables is that dynamic seems to be almost completely lost. Solar panels don’t require labour, after construction and installation, other than cleaning and a little maintenance. The same is largely true of windfarms. If so, then renewables have the capacity to eliminate the autonomist cycle – there are few workers to subvert the technology. Maybe people can steal a bit of free energy, or build a bit for themselves, but usually the panels are not near people’s homes and the theft would be obvious (wires leading to your house). Renewables, at a large scale, eliminate the need for many energy workers; the companies are not that dependent on workers or upon difficult to replace workers. The workers cannot easily withhold supply. This is part of the system’s profitability. Renewables, have the potential to make energy companies dominant with few checks, other than legislation and regulation, and that is controlled by neoliberals, and as the renewable companies gain wealth and control, what might stop them filling the gap in the socio-political ecology previously occupied by oil and coal? There is none of the Autonomist interactive construction of liberty that could be present in previous technology.

This implies that renewables are not inherently ‘popular’ in the sense of giving power to the people, unless the people commandeer the processes of production and organisation. And that is a situation which goes against the ways that the modern world is organised. The modern world is largely organised by the actions of the corporate sector, followed by the adaptation of the people to those actions. We no longer have community solidarity or self organisation as normal. When popular action occurs it is motivated by people like Trump, who misleadingly use that action to support himself and most of the rest of the dominant groups. He shares the dominant interests, and shows no sign of supporting the people in general – with the possible exception of tariffs, but even that seems geared at protecting particular types of industry or exerting commercial power on other countries.

We cannot dismiss either the possibility that politics will become more authoritarian to support capitalisms current destructions, or that it will stay as authoritarian as it is now, because of the way Renewable Energy is organised.

The Authoritarian and Anti-Democratic Background

It seems more or less indisputable that we are in a growing phase of authoritarianism. This authoritarianism generally is being put forward, by people who are also engaged in climate denial, or who support fossil fuels. There is no reason to assume that the two cannot link together powerfully. There is also the possibility of anti-climate change authoritarianism, to overcome resistance to necessary changes, but I’ll talk about that elsewhere – and I’ve just mentioned the possibility renewables could become an authoritarian technology. However, at the moment the authoritarian threat seems to be largely promoted by neoliberals and the Right. Neoliberalism always acts in an attempt to boost the power of the wealth and power elites to begin with.

In the US, neoliberals like Trump are currently dismissing election results and either encouraging or turning a blind eye to threats of violence against election officials or other Republicans who refuse to overturn, or throw out, the votes for Biden. This report may be exaggerated, but:

Kim Ward, the Republican majority leader of the Pennsylvania Senate, said the president had called her to declare there was fraud in the voting. But she said she had not been shown the letter to Congress, which was pulled together hastily, before its release.

Asked if she would have signed it, she indicated that the Republican base expected party leaders to back up Mr. Trump’s claims — or to face its wrath.

“If I would say to you, ‘I don’t want to do it,’” she said about signing the letter, “I’d get my house bombed tonight.”…

Even in Defeat, Trump Tightens Grip on State G.O.P. Lawmakers. New York Times, 9 December 2020.

In the Supreme Court, Trump allies:

sought to invalidate the state’s 2.6 million mail-in votes, 77 percent of which were cast for Mr. Biden…

Republicans argued that a 2019 state law authorizing no-excuse mail voting was unconstitutional, although it passed the Republican-led legislature and was signed by Gov. Tom Wolf, a Democrat….

Rudolph W. Giuliani aired false charges about the election, including an assertion that mail-in ballots in Philadelphia were “not inspected at all by any Republican.” The claims were debunked in real time on Twitter by a Republican member of the Philadelphia elections board.

Even in Defeat, Trump Tightens Grip on State G.O.P. Lawmakers. New York Times, 9 December 2020.

It seems that Republicans are basically saying election results, and votes, are only valid if they give Republicans victory, probably because they think Democrats are not truly American, but are truly monstrous, in all possible ways. That is what their media tells them, and it helps explain a distressing loss. Republicans who disagree with them are made outgroup. A tweet from the Arizona Republican Party suggested that people should be willing to die for Trump and to overturn the election, and another (later taken down, officially because of copyright concerns) said “This is what we do, who we are. Live for nothing, or die for something” (apparently a quote from the film ‘Rambo’). It is hard to see this as anything other than a call for violence on behalf of the party, or a call for people to sacrifice themselves for the party.

For what its worth, I suggested that the Republicans were trying to prepare for, and encourage, a Civil War back in July. Since then, Trump has been preparing his supporters by repeatedly arguing that the only way he could lose was through fraud, and that there is some massive Democrat plot against him. No one can guarantee election results unless they are successfully trying to fix them. This ‘protest’ against the result was not an unforeshadowed event, but one involving some long term planning. Trump warned he would protest the results and he did.

If Trump has real evidence of electoral fraud, then why is he generally presenting ambiguous, or hearsay, evidence to the public and not presenting solid evidence to the courts? The Courts have asked for evidence, and been refused or ignored. One possible theory is that Trump’s teams do not have any such evidence, and his lawyers do not want to face perjury charges by putting faked evidence to the court. Another is that he does not need success. Indeed the court cases he is putting forward and supporting have largely seemed engineered to be rejected by the courts, perhaps to give the impression that he is being victimised by the system or the ‘deep state’. He may just be trying to build up suspicion about, and resentment over, the results. That is much easier, it does not require real evidence, and appears to have a massive persuasive impact on his followers, and will keep them motivated.

Even William Barr, after displaying massive support for Trump, has determined “we have not seen fraud on a scale that could have effected a different outcome in the election.” Another official, Chris Krebs, the director of the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency, said “I’m here to tell you that my confidence in the security of your vote has never been higher… because of an all-of-nation, unprecedented election security effort over the last several years.” Krebs was sacked.

Trump may be planning to leave the Covid crisis and the likely economic collapse, to his enemies, and come back arguing everyone was prosperous under him, which shows how bad Biden and crew are. This could be why he seems to be ignoring Covid in his last months. Why should he try and fix it? Why not let deaths increase exponentially to make it harder for the incoming administration?

There is also a double standard. Trump is not complaining about Republican attempts to fix the election or his own attempts to sabotage mail voting during a pandemic, as he had reason to think that mail in voting would favour Biden, as Biden voters would be more likely to believe in the Pandemic. (Indeed, mail in voting did favour Biden, by a considerable margin, which Trump then used to suggest it was fake.) Similarly, it appears if armed protestors threaten death to people who are standing up for the Elections and not following the Republican line, then that is not a big deal at all.

Likewise when people drew up to shoot paintballs into protesting crowds, this was not a problem. How did the crowds know there were no bullets in amongst this? Paintballs can injure, that is why players wear protective clothing and goggles (dye in the eyes may not be pleasant never mind the impact), and paintballs can certainly vandalise clothes and property – which normally you would expect the right to complain about, but nothing.

This is authoritarianism displaying its muscles.

In some states in the US, we reportedly have armed right wing groups seeking non-existent Antifa arsonists, and threatening people photographing or fleeing the climate induced fires. Some people risked staying in their homes to protecting them from equally non-existent marauding Antifa terrorists. [11], [12], [13], [14], [15],[16], [17]. The point here is that the misinformation machine easily seizes on the fear of fellow Americans in the outgroup, and this suspicion is now normal.

The violent Right is in action, the democratic Right is largely silent, and the action is not likely to dispel if Biden gets past all the hurdles, or even if Trump manages to persuade the electoral college to vote for him, or if he persuades congress to refuse the vote for Biden. If Trump ‘wins’, he will have the violent Right to deal with any protests against his denial of the electoral process, assuming the Democrats do not cave in as usual. If Trump loses, then the Violent Right has all the excuse it needs to fight against a supposedly stolen election.

There is no reason to assume that if Trump is successful in building up a popular disturbance, whether he gets back into power or not, that the techniques will not be emulated elsewhere in the world.

While it is not evidence, of much except the building oppositions, and fears the following comment seems reasonably accurate to me.

It turns out that Trump wasn’t an aberration. He was the result of long-building extremism and reality-denialism on the right. And when he came to power, far too many in the Republican party didn’t see a cruel, incurious, dictatorial madman, but a kindred spirit – and the kind of leader who would happily override inconvenient democratic norms, basic standards of human decency, and even the rule of law. That became increasingly clear the longer Trump was in office; yet, out of naivety or perhaps just misplaced trust in other human beings, too many Democrats, pundits, and average citizens chose to believe that Republicans were simply caught between a rock and a hard place, and that Trumpism would end with Trump…..

[However] a request that a high court disenfranchise millions who voted according to the rules and overturn the will of the people – isn’t an issue on which reasonable people might disagree.

Filipovic Republicans are trying to get the supreme court to overturn democracy itself. The Guardian, 12 Dec 2020.

This kind of aggressive attack on political processes, meets up with attempts to criminalise protests against fossil fuel pipelines in the US, and the hardening of penalties for protests in Australia. This is a violence aimed at suppressing even mild dissent against the neoliberal establishment.

While the wealth elites can well support, encourage or turn a blind eye to this violent authoritarianism in the belief it can, and will, protect them, they can also find out, as they did with Mussolini and Hitler, that once violence is established, the supportive elites can be threatened along with anyone else.

Weaponising hatred

I’ve argued elsewhere in this blog [18], [19], [20] that fascism needs to find or manufacture vile enemies at home and abroad, to be successful and to give its supporters the ability to excuse their side’s violence. Fascism’s rhetorical process requires hardening social identity categories and that has been building up in the US, Britain and Australia over the last 40 years of normal political action, providing a good basis for fascists to work from. The election fuss works for them, in that it delegitimates anything other than a Trump win, suggests the left cannot be trusted, allows authoritarian right to plough on in its quest for liberty for some, and allows the potential threatening of Republican officials in future elections – they now know what happens if they stand up to agree a Democrat won, and the positions will attract those who are determined that their side shall win.

Earlier in this post I remarked on the righteous idea that it is the size of population in other countries that is to blame for climate change, should it be happening. This seems to be linked to the increase in ingroup political identities, racial tensions, and that general collapse in dialogue between political groups. Naomi Klein suggests that it is no coincidence that “these two fires, the planetary one and the political one, are raging at the same time.”

What all of these demagogues understand, is the power of fear. They are tapping into feelings of profound unease and scarcity, in their respective countries. Some of that scarcity flows from decades of neoliberal economic policies, the attacks on labor protections, the shredded social safety nets, the opened chasms of economic inequality…. [but]

We all know on some cellular level that life on this planet is in crisis. That our one and only home is unraveling. No one, no matter how much Fox News they watch, is protected from the feeling of existential terror that flows from that. And that is what men like Trump and Bolsonaro know. Their one true skill is how to make other people’s fear work for them. And so they rile up hatred and they weaponize desperation and they run campaigns on building walls and stopping pending invasions. And most of all they sell their respective in groups the illusion that they will finally be secure in our age of rampant insecurity….

all of this leaves them free to get on with a real business at hand, which is plundering the last protected wildernesses on this planet, from the Amazon to the Arctic.

Berkeley Talks transcript: Naomi Klein on eco-fascism and the Green New Deal

Generating enemies, gives the leaders the excuse they need to declare martial law, to declare elections that reject them rigged, to declare war on the outgroups – which are those that oppose them – and support violent people on their side (if indirectly at the beginning). It gives them the power to stop speech in the name of protecting their own speech. It makes it patriotic to continue the economic war which siphons money from ordinary people and protects the neoliberal elite and their liberty, and which destroys the environment and makes people more insecure.

This potential fascism is a destructive positive feedback loop, and it is hard to evade.

Conclusions

Neoliberalism generates the conditions in which authoritarianism becomes natural, and fights against it can also become authoritarian.

Democratic Communists thought they were winning in the 1920s and 30s, partly because they refused to take fascism seriously, or thought the workers would recognise that their interests were not served by fascism and would join the parties on their side. They also failed to win the middle class. They forgot the effectiveness of orderly violence which was deployed by fascists, and they thought the process of history would inevitably lead to workers’ revolution. It didn’t.

This lesson should not be ignored.

The future is never guaranteed. We cannot assume climate democracy is inevitable or even likely.

Neoliberal Conspiracy 07: Summary

December 6, 2020

[20 December 2020 – the original blog post has now been broken into two posts. The part here can be considered the summary of the argument, The part now placed here is a consideration of the plausibility of the argument]

What is the theory of Neoliberal Conspiracy?

The idea of ‘neoliberal conspiracy’ is simple. It is that many of those in the wealth elites, or working for them, have acted to increase established corporate power and wealth at the expense of the general public, while pretending that ‘free markets’ result in liberty and prosperity for all.

Neoliberalism has been the dominant real politics in the English speaking world since Thatcher, Reagan, and Keating, although (in the conspiratorial mode) it often presents itself as a minor oppressed player, that is struggling valiantly against government and socialists.

Effects of the Neoliberal Conspiracy

Neoliberalism’s effects are most clearly shown in the decline in the share of wealth going to ordinary people over those last 40 years.

Over the last four decades since 1979… those in the top 0.1% had wages grow… 340.7%. In contrast those in the bottom 90% had annual wages grow by 23.9% from 1979 to 2018. 

Top 1.0% of earners see wages up 157.8% since 1979. Economic Policy Institute, 18 December 2019

People are also less likely to increase their wealth class than they used to be. Some even claim that in the US and UK life expectancy has recently begun to decline [1], [2], [3] (possibly due to suicide and drugs) and hunger appears to be increasing in the US [4] (the pandemic response does not help) and elsewhere.

After steadily declining for a decade, world hunger is on the rise, affecting 8.9 percent of people globally. From 2018 to 2019, the number of undernourished people grew by 10 million, and there are nearly 60 million more undernourished people now than in 2014

World Hunger; Key facts and Statistics

Wealth seems spread so that while the top 10%, or so, of the population can be said to be comfortable, or extremely wealthy, the bottom 90% (especially younger people below 35) are heading towards a precarious existence, while the middle class is shrinking.

there is a recognition amongst these people of the novelty of their socio-economic circumstances, and thus frustration and disquiet at the nature of these circumstances. The ‘new normal’ is in fact recognised as abnormal. 

[However] they focus on how they can succeed within this inherited structure rather than on pursuing structural change. There is a degree of resignation to a situation wherein precarity is deemed largely immutable…. many young people understand the prospect of improving labour market outcomes in terms of personal development and their ability to successfully navigate this more competitive environment

Craig Berry and Sean McDaniel Young people and the post-crisis precarity: the abnormality of the ‘new normal’ LSE BPP 20 January 2020

Neoliberal media, rarely suggest an approach based on structural or economic change, that might challenge the dominant power relations, or they aim to misidentify those power relations. Another important marker of neoliberal effect, is that there appears to have been growing concentrations of economic power, with higher profits going to fewer people [5].

We used to think that high profits were a sign of the successful working of the American economy, a better product, a better service. But now we know that higher profits can arise from a better way of exploiting consumers, a better way of price discrimination, extracting consumer surplus, the main effect of which is to redistribute income from consumers to our new super-wealthy. 

Joseph Stiglitz “America has a monopoly problem – and it’s huge” Pearls and Irritations 15 November 2020

Corporations are now as wealthy as nations: “Of the world’s top 100 economies, 69 are corporations.” This implies they easily have the powers of wealth to buy States, especially if they ‘crony up’.

I probably don’t have to remind people, that the neoliberal response to almost every problem involves tax cuts for the wealthy and the corporate sector, possibly mixed in with some taxpayer subsidies for established big businesses not doing that well. It would seem obvious that this might help boost the wealth differentials, and gives the wealthy even more money to invest in political control. Of course they say this boost to the wealthy helps the lower classes, but the wealthy always make that argument, and it never seems to work. One study of 18 OECD countries, simply remarks:

We find that major reforms reducing taxes on the rich lead to higher income inequality as measured by the top 1% share of pre-tax national income. The effect remains stable in the medium term. In contrast, such reforms do not have any significant effect on economic growth and unemployment.

Hope & Limberg 2020. The Economic Consequences of Major Tax Cuts for the Rich. LSE Working Paper 55.

Let us be clear. It is a reasonable hypothesis that distribution of wealth results, not from the nature of life, but from deliberate social struggle, or social engineering. In which case, the way wealth is being distributed now, as opposed to 50 years ago, marks the triumph of class war against the people. As Warren Buffett said in the context of a discussion on taxes:

BUFFETT: Yeah. The rich people are doing so well in this country. I mean, we never had it so good.

DOBBS: What a radical idea.

BUFFETT: It’s class warfare, my class is winning, but they shouldn’t be.

Buffett: ‘There are lots of loose nukes around the world’

He is also reported as saying in an interview with the New York Times “There’s class warfare, all right,…. but it’s my class, the rich class, that’s making war, and we’re winning.”

Part of that class war undoubtedly involves the attack on, and the decline of unions, which gave workers the power to organise and challenge employers who were richer than whole countries, and who cronyed up together with other employers. Unions also meant that workers had direct input into party politics, as opposed to mainly business having input.

The period is also marked by growing ecological crisis, as capitalists and developers abandoned restraint, found profit in attacking science and in locking people into expanding fossil fuel use.

Neoliberalism appears to have generated a growth of alienation from politics experienced by ordinary people, as the political system consistently ignored their interests, no matter how large the protests (such as those against the second Iraq War, or against climate inaction). This alienation seems to have lead to an increase in culture wars, and polarisation, as the neoliberal Right sought to retain support and votes by whipping up an identity politics of self-justification and hatred against ‘out-groups’. For example, making claims that the left says you are racist simply because you are white (no other reason is possible), and that the only real racists are active black people, the only sexists are feminist women and so on. This leads to the part of the neoliberal conspiracy I will discuss later in this blog.

We don’t need to look so much at what neoliberals claim they believe, some of which might be well intentioned and genuine, but look at what neoliberal politicians actually do.

Neoliberals and the Government takeover

With the mixed economies, Keynesian interventionism, and union power, of post-world war II Europe, US, UK and Australia we had a steady rise in living standards, working conditions and increasing levels of political participation. This was alarming for the corporate elites. We could have ended up with a participatory democracy. This situation has now changed.

The first part of the current version of the neoliberal conspiracy has to be to negate the obvious point that “We’ve had forty years of free market boosting, and the world is not getting better.” As we might expect, the main idea that neoliberals want to promote is that we need more neoliberalism, and more of their ‘free markets’ to fix the mess generated by neoliberalism and their ‘free markets’ – truly what you might call ‘positive thinking’: lets ignore the counter evidence and persist in destruction as long as it pays us off. Thus almost their first effort is to convince people that most of the problems we currently observe, do not stem from neoliberalism, but from the ‘fact’ we have “too much government”, by which they mean too much government which might attempt to be responsive to the people.

Now they have a point. Governments can, and often are oppressive. Sometimes this is because of “one size fits all policies” which don’t fit all (like ‘free markets’), sometimes it is because the governors want total order and rule of one principle alone (like ‘free markets’), sometimes it is because they want to build things or go to war (say in favour of protecting investment and ‘free markets’), and sometimes it’s because they govern on behalf of a particular class (like neoliberals do). Scrap the last point, we are not meant to think about the last point, we are meant to think neoliberals are against government, not trying to commandeer it, away from you.

Neoliberals tend to pretend, that in a free market, business and the State (‘government’) have nothing to do with each other, rather than that they interact all the time. In neoliberal rhetoric, government and business are somehow completely different, or their intersection is of no consequence. Thus I can be told, by quite a few people over the years, that obviously crony capitalists only have an effect because of the government, and not because of the existence of cronyism, or the intersection of business interests with the State, or business influence over the State. This argument occurs while neoliberal politicians are overtly trying to win over the State completely so they can change it, and change the regulations of that State to benefit them.

Pretending to roll back the State is part of the strategy of increasing corporate power. Rollback of the State under neoliberalism is not remotely anarchistic. It is about rolling back those parts of the State that were moderately helpful, sensitive or responsive to the people, while keeping the parts of the state which are helpful to maintaining corporate power, and providing taxpayer subsidy to that power and suppression of protest. This is one reason why government size, regulation and ‘heaviness’, has not decreased, despite the years of neoliberals apparently pushing for a smaller State. At best it has just increased the powers of bosses, in general, over their employees.

As part of the process of increasing their power, Neoliberals attempt to remove any regulations which hinder corporate ability to freeload on the public; such as regulations which impose restrictions on their ability to injure and poison people, or pollute and destroy ecologies. Trump and other hardline neoliberal politicians have been extremely helpful in removing these kinds of regulations. Such regulations can diminish profits, although they may increase the possibility of prolonging people’s lives and physical comfort. Neoliberals think that if people want prolonged lives or comfort then they should pay for it, not rely on nature.

It is fundamental to neoliberalism, being a politics of established wealth, that any living being should only get what they can afford, and if they cannot afford to live, or fight against action that harms them, then they should suffer as the judgement of the market, is against them, and they are of no worth. Neoliberalism considers protecting established capitalism more important than protecting life.

Neoliberals buy government policy which benefits corporate power, and then, when it turns out badly for people in general, claim that the situation would be much better if, rather than supporting the harmed, we did not have any government intervention at all and we just left everything to the corporate class to sort out – as if benefits inevitably flow through to those who don’t participate, and the people who caused the problems will necessarily fix them by accident.

The great thing about the strategy of pretending to be anti-State while using the State to enforce their rule, is that whenever the neoliberals use the State to shaft their supporters they can claim they could have had nothing to do with it. It was the dreaded socialists of the ‘deep State’ that are to blame. And they get even more leeway to rollback the State useful to others and build up the State useful to them.

It is common sense in neoliberal land for corporate lobbyists, or ex corporate executives to write legislation or even occupy positions in government departments. Despite his claims of employing outsiders this is what Trump has done in a big way [6], [7].

Steve Mnuchin from Goldman Sachs became the first Treasury Secretary. Gary Cohn president and chief operating officer of Goldman Sachs was picked to head the National Economic Council and manage economic policy. Steve Bannon once worked for the same organisation, before becoming a Breitbart executive chair and also obviously worked for the administration. Jay Clayton, Securities and Exchange Commission chairman, was a partner with the law firm Sullivan & Cromwell, and Goldman Sachs was a client. ExxonMobil CEO Rex Tillerson was made Secretary of State.

At the EPA, nearly half of the political appointees hired by the Trump Administration have had strong ties to industries regulated by the agency industry, according to research by the Associated Press.  About a third of these EPA appointees – including the current acting administrator – formerly worked as registered lobbyists or lawyers for fossil fuel companies, chemical manufacturers, or other corporate clients….

The Administration has been pursuing a de-regulatory agenda that benefits many of these same industries by rolling back air and water pollution control regulations. This inverts the purpose of the agency, which is to protect the environment and public health, not industry profits.

Who’s Running Trump’s EPA, EPA Conflict of Interest Watch. Environmental Integrity Project nd.

The number of lobbyists Trump appointed was quite extraordinary

A lobbyist for every 14 political appointments made… The number of lobbyists who have served in government jobs is four times more than the Obama administration had six years into office. And former lobbyists serving Trump are often involved in regulating the industries they worked for….

It’s a “staggering figure,” according to Virginia Canter, ethics chief counsel for the D.C.-based legal nonprofit Citizens for Responsibility and Ethics in Washington.

Update: We Found a “Staggering” 281 Lobbyists Who’ve Worked in the Trump Administration. ProPublica, 15 October 2019

A report from early in Trump’s administration states:

The president-elect, in filling out his transition team and administration, has drawn heavily from the vast network of donors and advocacy groups built by the billionaire industrialist [Koch] brothers, who have sought to reshape American politics in their libertarian image.

From White House Counsel Don McGahn and transition team advisers Tom Pyle, Darin Selnick and Alan Cobb to Presidential Inaugural Committee member Diane Hendricks and transition-team executive committee members Rebekah Mercer and Anthony Scaramucci, Trump has surrounded himself with people tied to the Kochs….

many more Koch-linked operatives are expected to join Trump’s nascent administration in the coming weeks, according to Trump transition-team sources.

Vogel and Johnson Trump’s Koch administration. Politico 28 November 2016.

This network of lobbyists appeared to influence the taxpayer handouts to business during the Covid response:

lobbyists with ties to the president have successfully secured billions in aid for their clients—and several lobbyists may be violating President Donald Trump’s own executive order on ethics in the process.

Trump-Connected Lobbyists Are Getting Billions In Federal Coronavirus Aid, Report Finds, Forbes 6 July 2020

Instead of staring down “the unholy alliance of lobbyists and donors and special interests” as Trump recently declared, the influence industry has flourished during his administration.

Trump’s Cabinet Has Had More Ex-Lobbyists Than Obama or Bush. Fortune, 18 September 2019

No clearing ‘the Swamp,’ but a lot of importing alligators.

Neoliberalism deliberately tends to ignore how much government intervention there was in the economy in the years of rising prosperity for everyone, or tries to portray these years as some kind of disaster. They buy revisionist history, so that we can argue the Great Depression was actually caused by government and that the recovery was hindered by the New Deal. The point is that capitalism depends on a State, and capitalists attempt to control the State, so there is always state action which can be blamed, and used to direct attention away from how business was behaving, or what it was attempting to do. For example, if Hoover’s trade embargos and tariffs were the only factors causing the Great Depression, then what businesses was he defending, and why are Trump’s tariffs not going to be equally destructive?

The question about governments really should be, “Who controls the rule making and enforcement, that allows the market to be maintained?” And the answer to that, is the established corporate sector and not the people. So the market is structured and regulated to benefit the established corporate sector and not the people. That is why the proportion of wealth distributed to the people is going down, and the proportion of wealth going to the wealth elites is increasing.

Ronald Reagan was a classic example of neoliberal action, cutting taxes for the wealthy, cutting back social security and making welfare more onerous and expensive, while massively increasing military spending which benefitted corporate arms manufacturers, and increased the deficit. The idea was that the deficit should eventually be curtailed by ‘reluctantly’ cutting ‘helpful-to-the-people’ spending. Reagan’s ‘free market reforms’, not only crashed the S&Ls which severely impacted many ordinary people, but it allowed much of US industry to be asset stripped and destroyed. This helped produce the US’s current manufacturing problems and rampant business oligopolies, as small scale business was harmed. Neoliberals may say they are in favour of small business, but their actions nearly always help destroy small business, as do the actions of Wall-Mart and the other large retailers who they support.

The big difference between US Republicans and Democrats is that Republicans are hardline neoliberals who pretend to like rightwing Christians, while Democrats are more humanistic neoliberals who are suspicious of Rightwing Christians being Christians at all, and who think that people don’t need to be suppressed and persecuted by big business all the time. For example, Obama thought that bailout money given to established financial institutions should be paid back, and should not explicitly pay for parties and executive bonuses, unlike his predecessor. He did not, however, think bailout money should go to people who were going to lose their home through financial institutions calling in misleading loans, as a democratic socialist might do.

Neoliberal Media

On the whole the media is pro-capitalist, as it is largely (if not totally) funded and controlled by corporations or billionaires. Who else has the money? Most of it is hardline neoliberal, taking neoliberalism as the only position possible – especially media associated with the Murdoch Empire (like Fox, the Wall Street Journal and The New York Post in the US, or Skynews in Australia, The Sun and The Times in the UK), other Trump supporting media is similar, but it also includes Facebook and Twitter, who helped Trump win the previous election because they happily sold data to neoliberal conspirators like Cambridge Analytica, and gave them a free playground. Social media (Facebook, Youtube, Twitter) also keeps channeling people into more extreme forms of the neoliberal conspiracy if they show any interest in going along with it – so they act as advertising channels for this material. There is little escape – the internet, as currently organised, does not widen the opinion and news people are exposed to; it narrows it.

The basic principle for any analysis, given the neoliberal environment, is that no media should be trusted, and that includes small media. Small media can as easily be funded by billionaires as large media; it requires less capital and is more disposable when it has served its purpose, so it may be a better investment. Some big-billionaire-media like Breitbart or Skynews may pretend to be ‘alternate’, but they are just heavily controlled neoliberal propaganda channels – which sometimes seem coordinated in their decisions about what counts as news and what does not. They are certainly not going to portray the situation accurately or impartially.

Neoliberal Science

It is a remarkable co-incidence that nearly all science which might cause constraints on corporate action is attacked by supporters of neoliberalism, while science which allows corporations to build or manufacture products is not. Thus climate science has to go. Ecological science has to go. And the idea of pandemics has to go, even it pharmaceutical companies can make money out of vaccines.

Neoliberal Covid

Covid-19 policy and responses can be analysed in terms of their support for neoliberal principles. The main aim of neoliberal government is to keep the economy going, and keep the power relations of the established economy intact. If it cannot do that then the aim is to protect and subsidise the wealth elites during the crisis rather than the people. It is a response based defending corporate power and liberty to use workers, even if it hurts the workers. If quarter of a million, and now many more, die to keep the economy roughly intact, then that is surely a small price to pay for corporate comfort?

Neoliberal responses may not have caused redistribution of wealth, but it is clear that in the US those responses have been used, under Trump and the Republicans, to further redistribution of wealth with massive subsidies and tax breaks going to wealthy people and wealthy organisations. Some of this going to oil and fracking companies, who were already doing badly without Covid [8], [9], [10], [11]. It is well known that many billionaires have increased their wealth substantially during the crisis, as you would expect of such a pro-established wealth based response [12], [13], [14].

Interestingly I have noticed amongst Republican friends and news sources a marked hostility to the increase in the wealth of info-tech billionaires in particular, without much protest about the increases in the wealth of other kinds of billionaires.  I’m not aware of any subsidy, regulatory favours, tax breaks etc, which were specifically, or only, aimed at Info tech, or at Gates, Bezos, Zuckerberg etc. However, this kind of thing tends not to get reported in the mainstream media, so if these special government aids exist, then I would welcome being informed about them, as it would add to the evidence about how the system works.

However, that some industries flourish and get ridiculously rich while others suffer and decline, would seem to be what we would expect from the free market in action. This is how the market supposedly works, and how it is meant to work, culling inefficiency, bad management and unwanted products and massively rewarding services that people need. So I’m not sure why this should be praised in some circumstances and damned in others. My current hypothesis is that the Republican party and its elites are owned by established industries and big business, and are hostile to newcomers, but I have no real idea if that is correct.

Surprisingly (?) it does not appear that many of these billionaires (tech or otherwise) have used their increased wealth to protect their workers, or make sure they have good health leave. Indeed:

One in eight workers has perceived possible retaliatory actions by employers against workers in their company who have raised health and safety concerns during the pandemic.
Black workers are more than twice as likely as white workers to have seen possible retaliation by their employer.

National Employment Law Project Silenced About COVID-19 in the Workplace

Well it might lower profits, and if some people get really ill and have lasting consequences, or some people die, its for a good cause.

The Republicans, in the US, are also demanding protection for companies from any liability law suits which claim they not properly looking after workers [15], [16], [17]. Mitch McConnell, Republican leader in the US Senate, said:

as the Majority Leader I can tell you no bill will pass the Senate that doesn’t have the liability protection in it…..

Republicans almost to a person support the liability reform and that’s not about companies. It includes companies. It’s about hospitals and doctors and nurses and teachers and universities and colleges and K-12. This is not just liability protection for businesses. They’re included along with everyone else dealing with this brand new disease. Unless you’re grossly negligent or engage in intentional misbehavior, you’ll be covered. And it will be in a bill that passes the Senate.

McConnell on CNBC’s “Closing Bell”

Strange to protect companies from being sued over a condition which Republicans apparently claim is not real, or not that harmful.

This reminds us that the majority of times we are censored, or self-censored, or forced to do unpleasant things it is not because of the government, but because of our employer. Neoliberals want most people to be subservient to bosses. Again neoliberalism is not anarchism or the activation of liberty.

Discouraging social distancing, has the side effect of boosting pharmaceutical company profit, just as Trump’s promotion of unproven drugs helped boost their profits, and as will reliance on vaccines. However, this result may not be entirely deliberate, only a ‘fortunate’ consequence of the general approach to business.

To repeat, neoliberalism has no concern over whether ordinary people survive, or not. It holds that if people can’t afford to survive, they should suffer.

What I hope is the final part of this ‘Neoliberal Conspiracy’ project, will be a simple consideration of whether the Neoliberal Conspiracy is plausible.