Posts Tagged ‘ethics’

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On one hand, Dave Elder-Vass is absolutely right: “we should see our economy not simply as a capitalist market system but as a collection of ‘many distinct but interconnected practices’.”*

As I have explained before, that view of the “iceberg economy”—which has been highlighted in the work of J. K. Gibson-Graham—represents a fundamental challenge to neoclassical economists, for whom

the entire economy is visible and consists of capitalist markets—or unwarranted constraints on capitalist markets, which should be eliminated. According to iceberg economists, capitalist markets are only the tip of the iceberg, and there’s a proliferation of noncapitalist economies below the waterline.

But Elder-Vass also uses it against Marxists who, in his view, see “one central mechanism in the economy: the extraction of surplus from wage labour by capitalists” and leave out ethical issues.

The problem is, while Elder-Vass credits J. K. Gibson-Graham, especially their book The End Of Capitalism (As We Knew It), with the idea that unified, totalizing metaphors of the economy (like a “capitalist market system”) can make it difficult to think outside the box and imagine alternatives, he forgets that Gibson-Graham themselves used the categories of the Marxian tradition—including the idea of class defined in terms of surplus labor—to decenter the economy.**

He also overlooks the fact that Gibson-Graham (as well as others who have worked with and alongside them in the larger Rethinking Marxism tradition) have insisted on the ethical dimensions of the Marxian critique of political economy—which includes, but of course is not limited to, a critique of the social theft associated with capitalist and all other forms of exploitation (that is, areas of the economy—whether capitalist, slave, feudal, and so on—in which those who perform surplus labor are excluded from appropriating their surplus labor).

In fact, according to two of Gibson-Graham’s close associates, Jack Amariglio and Yahya Madra, ethics are central to Marx’s critique of capitalism and mainstream economics.*** But Marx’s commitment to communism is not governed by an actual model or a fixed morality. Rather, they argue,

The ethical is embodied in Marx’s enduring faithfulness to sustaining a critical position toward the existing state of affairs, not in his particular and changing dismissals of capitalism or in his obscure, partial formulations of the shape communism might take. The lesson of Marx is that, facing the abyss of an unknown communism, the ethical is the will to risk a different social organization of surplus.

To put it in terms of the iceberg economy, the ethical is the will both to recognize the noncapitalist forms of economy below the waterline and to risk a different social organization in which capitalist exploitation ceases to be the exclusive or even predominant mode of appropriating and distributing the surplus.

Contrary to Elder-Vass, then, seeing the economy “not simply as a capitalist market system” is consistent with the Marxian critique of political economy, including the ethical stance that is informed by and embodied in that critique.

 

*I will try to be careful here because I have not yet had a chance to read Elder-Vass’s book,  Profit and Gift in the Digital Economy. I am relying, instead, on Daniel Little’s review of the book and Elder-Vass’s response.

**Gibson-Graham also borrowed from other traditions, such as feminism, queer theory, and poststructuralism to create their iceberg economy.

***See their entry on “Karl Marx” in the Handbook of Economics and Ethics, ed. J. Peil and I. van Staveren, 325-32 (Edward Elgar, 2009).

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I have argued many times over the years that mainstream economists, especially mainstream macroeconomists, largely ignore the issue of inequality. And when they do see it, they tend to misunderstand both its causes (often attributing it to exogenous events, such as globalization and technical change) and its consequences (often failing to connect it, other than through “political capture,” to events like the crash of 2007-08).

In my view, mainstream economists overlook or forget about the role inequality plays, especially in macroeconomic events, for two major reasons. First, their theoretical and empirical models—either based on a representative agent or undifferentiated macroeconomic relationships (such as consumption and investment)—can be solved without ever conceptualizing or measuring inequality. The models they use create a theoretical blindspot. But, second, even when it’s clear they could include inequality as a significant factor, they don’t. They literally choose not to see inequality as a relevant issue in making sense of macroeconomic fluctuations. So, as I see it, when it comes to inequality, mainstream economics (especially, as I say, mainstream macroeconomics) is haunted by both a theoretical and an ethical problem.

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That’s why recent research by Kurt Mitman, Dirk Krueger, Fabrizio Perri is so interesting. What they show, using a standard macroeconomic model with household heterogeneity to account for an unequal wealth and consumption distribution, is that inequality does in fact matter. In particular, they demonstrate that the aggregate drop in expenditures depends on the distribution of wealth (e.g., it is much larger in an economy with many low-wealth consumers) and that the effects of a given macroeconomic shock are felt very differently in different segments of the wealth distribution (e.g., low-wealth households have little ability to insure themselves against risk, and thus the welfare impact of a recession is significantly larger for them). As a consequence, they make it abundantly clear that ignoring inequality means failing to understand the severity of a macroeconomic downturn and underestimating the welfare costs of a deep recession.

That’s not all the work that needs to be done, of course. Mitman et al. rely on exogenous macroeconomic shocks rather than analyzing how inequality itself plays a role in creating the conditions for an economic downturn. But even their limited attempt to include inequality as a significant factor in an otherwise-mainstream macroeconomic model demonstrates that such work can in fact be done.

In other words, it’s not that mainstream economists can’t make sense of inequality in their models. They simply, for the most part, choose not to.

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The other day, I expressed my doubts about Paul Mason’s arguments about postcapitalism. But others see his argument in a much more positive light, including some friends of mine, Jenny Cameron, Katherine Gibson, and Stephen Healy [ht: sk].

They, too, however, assert that “technology does not in and of itself guarantee a better future.” What are needed, and which they see emerging in the midst of capitalism today, are “explicit ethical commitments that are developed independent of online apps and cyber networks.”

Technology is augmenting relations of care for others. Technology does not bring these relations into being.

In our research on the diverse economic practices that exist outside the purview of mainstream economics, we find people are forging new types of economies around six ethical concerns:

  • What do we need to survive well?
  • What happens to surplus, or what is left over after our survival needs have been met?
  • How do we act responsibly to those whose inputs help us to survive well (whether other people or the environment)?
  • How much and what do we consume in order to survive well?
  • How do we care for the commons – the gifts of nature and intellect that we rely on?
  • How do we invest so that future generations can also live well?

I think they’re right: we do need to be aware of the ways the existing set of relations—the relations of capitalist commodity production—not only create capitalist subjects, but also noncapitalist subjectivities.

The way I’ve put it in my own writing, capitalist commodity production both presumes and constitutes particular kinds of individual subjects (which Marx referred to as “commodity fetishism,” i.e., particular notions of “freedom, equality, property, and Bentham”). But it also brings into existence new collective subjectivities—new ways of “being in common”—that can transcend capitalism.

A concrete example might help here. The existence of capitalist healthcare (of healthcare providers as well as healthcare insurers) both presumes and supports the idea that healthcare is an individual concern: we are supposed to take care of our own individual healthcare (whether through the established healthcare system or via “alternative” therapies) and purchase healthcare commodities (again, either established or alternative) if and when they are necessary. But it is also the case that the existence of healthcare commodity markets also brings together providers and consumers—nurses, doctors, and patients—who have an interest in a different kind of healthcare, one that is less interested in profits and more in the well-being of both providers and consumers.

That alternative subjectivity—that “being in common” in relation to healthcare—can serve as the basis of a noncommodified, noncapitalist form of healthcare. And, pace Mason, new kinds of information technologies might even be useful for connecting producers and consumers in postcapitalist ways. There’s nothing automatic about it, of course. Still, both new ethical commitments and information technologies signal the possibility of ways of moving beyond capitalism.

The key is to find ways to combine those emerging technologies and ethical concerns in a political movement that is inspired by a fundamental critique: both what is wrong with the existing order and an imagining of a concrete alternative.

That’s what comes next. . .

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