Posts Tagged ‘gift’

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Maarten Vanden Eynde, The Invisible Hand (2015)*

We hear it all the time. On a regular basis. Having to do with pretty much everything.

Why is the price of gasoline so high? Mainstream economists respond, “it’s the market.” Or if you think you deserve a pay raise, the answer again is, “go get another offer and we’ll see if you’re worth it according to ‘the market’.”

Alternatively, if you want to solve a particularly pressing problem—such as climate change, widespread unemployment, or Third World poverty—mainstream economists’ usual answer is “let markets handle it.”**

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Markets have a magical, quasi-mystical status within mainstream economics. They are both the original starting-point and far-reaching conclusion of mainstream economic theory. What I mean, first, is markets are there at the very beginning, without any explanation of where they come from or how they are formed—although there may be an occasional nod to Adam Smith (who famously invoked a natural “propensity to truck, barter, and exchange one thing for another”) or Robinson Crusoe (which presents, on one reading of Daniel Defoe’s novel, the model of two individuals who trade to their mutual benefit under conditions of equality, reciprocity, and freedom).*** Otherwise, markets are just there, with the requisite price and quantity axes and supply and demand schedules, as the starting point for economic analysis. Then, after a great deal of theoretical work (concerning the underlying determinants and the final consequences), markets are declared to be the best solution to the problem of scarcity (in finding a perfect balance between limited means and unlimited desires).

After min. wage

The “proof” of the superiority of markets often occurs in two steps (although today, in the usual sloppy teaching of mainstream economics, the second step is left out). At the level of individual markets, mainstream economists’ argue that economic welfare—consisting of the sum of consumer and producer surplus—is maximized at equilibrium. “Consumer surplus” is the extra benefit enjoyed by consumers in a market who pay less for goods and services than they were willing and able to pay for it (areas A + B + C, in the diagram above). Meanwhile, “producer surplus” is the difference between what producers are willing and able to supply a good for and the price they actually receive (areas E + D). At the equilibrium, the sum of the two is at its maximum. In contrast, when the market is not at equilibrium (such as when there’s a minimum wage, a wage rate above the market equilibrium wage rate, the green line in the diagram), there’s a “deadweight loss” (consisting of C + D). As far as mainstream economists are concerned, each market in equilibrium (whether for oranges or labor) creates the most total welfare for market participants.

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What about the market system as a whole? Here, the argument is somewhat different. It’s a theory about efficiency, not welfare.**** Mainstream economists claim that, when taken together (in what is referred to as general equilibrium), markets can generate a set of prices that finds a point—for example, A, B, or C, in the diagram above—on the “production possibilities frontier.”***** That’s the maximum amount an economy, given its technology and resources, can produce. Any point inside the frontier (such as D) represents an inefficient allocation of resources (more can be produced of either or both goods without the kind of tradeoff that occurs on the frontier). Importantly, Pareto efficiency means that no one can be made better off without making someone worse off.

That’s the remarkable, counter-intuitive conclusion of the mainstream theory of markets: everyone—every individual and society as a whole—benefits in a world in which all households and firms make decisions based solely on their own self-interest.

Thus, mainstream economists’ celebrations of the market and market solutions for all economic and social problems rely on both the presumption of markets as the given starting-point of analysis and their sweeping conclusions, concerning individual markets and the market system as a whole.

It is, of course, easy to criticize one or another of the assumptions underlying the celebration of free markets, many of them formulated by mainstream economists themselves. For example, markets may have “negative externalities,” that is, social costs that are greater than private costs (pollution is a common example). Under such conditions, more of a good or service will be produced than is socially beneficial. Monopoly power also distorts markets, since with market power firms will produce less, at a higher price, than if they operated according to the model of perfect competition (and, as mainstream economists are now discovering, it’s likely they will pay lower wages).****** Imperfect and asymmetric information, too, will lead to inefficient market outcomes—such as, for example, when conflicts of interest arise between a principal and an agent in a firm or banks are able to sell more financial products (such as derivatives) if they can conceal the true level of risk.

Thus, we can understand the two poles of debate within mainstream economics. Economists within the conservative or libertarian free-market wing celebrate free markets and criticize any and all forms of government intervention, while those in the more liberal wing focus on market imperfections and call for more government regulation of markets. Once again, it’s the invisible hand versus the invisible hand.

But underlying and informing the debate between the two wings of mainstream economics is a shared utopianism of markets as the best, natural and most efficient way of allocating goods and services—including labor, money, and natural resources. They may and often do disagree about the necessity and effectiveness of freeing-up or regulating markets, which comes down to whether or not they “see” exceptions to the basic model of perfect markets. But they share a belief that the logic of decentralized private markets is the appropriate way of thinking about and organizing the “world of goods.” In other words, mainstream economists debate, often intensely and with no small degree of sneering and sarcasm, the best way of getting markets to operate correctly—but that’s only because they utilize the same basic theory according to which a properly functioning market system is the only appropriate foundation and goal for theory and policy. Market fundamentalism thus represents the utopian horizon of mainstream economics.

The critique of market fundamentalism starts where mainstream economics leaves off—with the idea that the world of goods can and should be organized by markets.*******It highlights the hidden ground of the mainstream theory of markets and calls into question the very possibility of market exchange. The result is a different utopian horizon, which both refuses the self-suturing conception of market value and opens up the realm of possibility for other ways of organizing economic and social life.

When mainstream economists blithely draw the diagram or write down the equations for a market, what they’re doing is presuming—while failing to mention, let alone discuss—a whole host of conditions. Callari focuses on mainstream economists’ “image of the economy as a world of goods, and of the world of goods as a homogeneous field.” Such an image serves as the foundation for the positing of calculable “interests,” which thus become the central code of the economy and society. Within the homogeneous field of goods, every action can be connected with every other action in a measured (that is, analytically calculable) way. Once all the appropriate calculations are completed, “the market”—both individual markets and the market system as a whole—finds its equilibrium, the self-suturing reconciliation of all the competing interests. It also closes off the field of goods to any inspiration or influence other than self-interested rationality—be they traditions, social obligations, or ethical commitments.

Taking up on and extending that point, Amariglio argues that many of the features of non-market transactions involving goods and services (such as the gift) also haunt market exchanges.

There is nothing at all “certain” about any act of exchange, and nothing in it less symbolic or less “about” power, responsibility, meaning, and so forth. Likewise, there is something fundamentally “constituted” and “constituting” about identities and subjectivities in every act of exchange. Leaving aside the question of the multiplicity within selves who enter into trades, the fact remains that exchange is a very overloaded activity, and trading partners not only may be of several different minds about the transaction, but are often uncertain as to what exactly such transactions “mean” in terms of their own or others’ wealth and property, the effects on their well-being, who or what subject positions they occupy, what exactly is being traded, and so forth.

Market exchanges are therefore crosscut—just like any other allocative transaction, be it the gift, planning, or plunder—with a whole host of perturbations and undecidables. Both markets and the interests they are said to represent rely on “external” (historical and social) conditions and are, in different times and spaces, characterized by considerable uncertainty and indeterminacy. And once we begin to investigate those conditions, once we begin to analyze the “openness” of markets, we are forced to confront the ability of any act of exchange—and, for that matter, any economic discourse about markets—to successfully suture itself, at least in any kind of “permanent” act of closure.

The impossibility of market exchange, in general, suggests the need to recognize and attend to the historical and social specificity of individual markets—without any overarching, general theory of price or exchange-value. It also opens the door both to other commitments, whether ethical or political, and to other means of transacting goods and services, as they imply different conditions and consequences for society, for the social relations among persons, things, and nature.

Imagining and enacting those possibilities represent the utopian horizon of the critique of markets and mainstream economists’ theory of the market system.

 

*The Invisible Hand is a rubber copy of the right hand of Leopold II, taken at night from the 1926 sculpture by Thomas Vinçotte, located at the Regentlaan in Brussels, Belgium. The mould was taken to a former rubber plantation in Kasai-Occidental in the Democratic Republic of Congo and filled with natural rubber. The rubber hand was presented at Art Brussels 2015. It refers both to Adam Smith’s theory (as elaborated in the Theory of Moral Sentiments and The Wealth of Nations) and to Leopold II’s use of the International African Association (1877-79) and later the Congo Free State (1885-1908) to pillage the available natural resources. The grotesque result is that, by doing so, he “unwittingly” instigated local economic growth but at a high price: more than 10 million people are estimated to have died as a consequence of Leopold’s “Invisible Hand.” The Invisible Hand also points to the custom of chopping off the hands of enslaved people to ensure the rubber quota. To paraphrase Marx, markets come “dripping from head to foot, from every pore, with blood and dirt.”

**With one notable exception: healthcare.

***The Robinson Crusoe story has been read in a radically different vein by many heterodox economists, including Stephen Hymer and Ulla Grapard.

****Mostly because of Kenneth Arrow’s “Impossibility Theorem,” which challenged the idea that there’s a procedure for deriving a collective or “social” ordering—a Social Welfare Function—based on individual preferences.

*****While mainstream economists can claim to have solved the problem of “existence” (i.e., that there is such a set of prices consistent with overall efficiency), much to their consternation they have not been able to prove either “stability” (that prices, if away from the equilibrium set will move toward the equilibrium) or “uniqueness” (in other words, there may be many such sets of prices).

******That’s why, as I teach my students, there is such a thing as a free lunch: just abolish monopolies and oligopolies, and the economy can increase production (technically, the economy can move from inside to the production possibilities frontier without any additional resources or new technology, just by eliminating imperfect competition).

*******The critique I present here is inspired by two key essays—Antonio Callari’s “The Ghost of the Gift: The Unlikelihood of Economics” and Jack Amariglio’s “Give the Ghost a Chance! A Comrade’s Shadowy Addendum—both published in The Question of the Gift: Essays Across the Disciplines, edited by Mark Osteen. It is also informed by research that appeared in Postmodern Moments in Modern Economics, by Amariglio and myself.

 

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Over the course of the last two days, I’ve discussed mean gifts (which promise significant tax relief only to a small group of corporations and wealthy individuals) and mean exchanges (which leave middle-class Americans with a declining share of national income).

Now, thanks to recently completed Reuters investigation, we’re forced to confront the reality in the United States of mean exchanges that transform generous donations into desperate, mean gifts. I’m referring to the largely unregulated trade in body parts.

The selling of body parts—heads, knees, feet, torsos, and entire bodies—actually begins with the gifting of the bodies of deceased Americans, who have decided to donate their bodies to science. But in many cases it’s a mean gift, not because of the intentions of the givers (who in many cases do want to contribute to the advancement of the scientific study of the human body), but because body brokers often prey on poor people (who can’t afford the price of a proper burial).

The industry’s business model hinges on access to a large supply of free bodies, which often come from the poor. In return for a body, brokers typically cremate a portion of the donor at no charge. By offering free cremation, some deathcare industry veterans say, brokers appeal to low-income families at their most vulnerable. Many have drained their savings paying for a loved one’s medical treatment and can’t afford a traditional funeral.

“People who have financial means get the chance to have the moral, ethical and spiritual debates about which method to choose,” said Dawn Vander Kolk, an Illinois hospice social worker. “But if they don’t have money, they may end up with the option of last resort: body donation.”

Then, the body brokers—aka non-transplant tissue banks (that are distinct from organ and tissue transplant banks, which the U.S. government closely regulates)—turn around and sell or rent bodies and body parts for use in research or education.*

“The current state of affairs is a free-for-all,” said Angela McArthur, who directs the body donation program at the University of Minnesota Medical School and formerly chaired her state’s anatomical donation commission. “We are seeing similar problems to what we saw with grave-robbers centuries ago,” she said, referring to the 19th-century practice of obtaining cadavers in ways that violated the dignity of the dead.

“I don’t know if I can state this strongly enough,” McArthur said. “What they are doing is profiting from the sale of humans.”

The body brokers can charge what they want to for cadavers or deceased body parts. They negotiate prices with with research facilities—$250 for a hand, $450 for a knee, $5000 for a whole body—and even put their inventory on sale when they become overstocked.

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The result is a profitable exchange for the body brokers—who of course are getting their raw materials for free—and the destruction of the gifts people have attempted to make to science.

Gail Williams-Sears, a nurse in Newport News, Virginia, said neither she nor her father realized Science Care might profit when he donated his body before his death in 2013. John M. Williams Jr, who lived 88 years, served in World War II and the Korean War, earned a master’s degree in social work and spent decades in Maryland state government advocating for children.

“Dad was very frugal,” his daughter said. “He thought it was ridiculous to pay a large amount of money to be put in the ground.” His decision to donate his body was also motivated by a lifelong interest in good health, his Christian faith and science fiction books and movies, she said. Whenever he was admitted to the hospital, he made sure to bring the donor documents with him, in case he died, his daughter said.

“I don’t remember anything in the literature that said anything about them selling his body,” she said. “I thought it was just his body going for research and it wasn’t to get gains off of someone’s charity. Well, I guess we’ve gotten to a world where everybody just makes money off of everything.”

The United States is now based on an economy in which many people can’t afford to die, and whose final gifts to science are annulled by the profit-making exchanges of largely unregulated body brokers.

 

*Selling hearts, kidneys and tendons for transplant is illegal in the United States. But no federal law governs the sale of cadavers or body parts to academic, medical, or scientific facilities.

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Yesterday, I discussed the mean-spiritedness of the Republican tax cuts—which are being sold as a gift to the middle-class but, in reality, represent a massive transfer to a small group of large corporations and wealthy individuals.

But, of course, the real violence associated with the tax-cut gift occurs before federal taxes are even levied, in the pre-tax distribution of income.

As is clear from the chart above, since the mid-1970s, the share of income captured by the top 1 percent (the red line, measured on the right-hand side) has almost doubled, rising from 10.6 percent to over 20 percent. Meanwhile, the share of income going to the middle 40 percent (the blue line, on the left) has eroded, falling from 45.2 percent to 40.4 percent.

But that’s not enough for those at the top. They want even more—and their growing share of the surplus has given them more power to elect the candidates and write the rules to obtain even more income, both before and after taxes.

Meanwhile, many in the languishing middle-class, having given up hope for any improvement in their pre-tax income share, threw in their lot with the Republicans and their promise of tax relief.

They now know that that’s a dead end, too.

The American middle-class continues to lose out, both when they exchange their ability to work for an income in markets and afterwards, when they pay their taxes to the government.

Meanwhile, the tiny group at the top has been able to rig both mechanisms, exchange and taxes, to capture and keep more of the surplus.

Something clearly has to give.

Finally, in this season of the gift, something other than the usual, tired discussion of “deadweight loss” by mainstream economists.

Deborah Y. Cohn explains that “sometimes people give bad gifts on purpose.”

Although it seems nonsensical to give someone a gift that will damage a relationship rather than strengthen it, some people deliberately do just that.

Not only are these returns a drag for businesses, they harm friendships and fray family bonds.

Of course, historically there are plenty of examples of mean-spirited, even violent gift-giving. Potlatch in the Pacific Northwest is a good example—of chiefs giving away or destroying goods in order to create or reinforce relations of unequal power within and between clans, villages, and nations.

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The Republican tax bill, which President Trump signed last Friday, is another example of the violence of the gift. With one exception: whereas in potlatch the hosts demonstrate their wealth and prominence through giving away goods to everyone else, “The Tax Cuts and Jobs Act” will mostly benefit a small group of corporations and individuals that already capture and distribute to themselves most of the surplus.

Trump, Mitch McConnell, and Paul Ryan may be using the rhetoric of a gift to the middle-class but, according to a recent poll, most people remain unconvinced. They know they’re only getting pennies on the dollar of tax cuts to those at the top.

the NBC/WSJ poll finds 63 percent of Americans who think the Trump tax plan was designed mostly to benefit corporations and the wealthy, compared with 22 percent who believe it was designed to help all Americans equally.

Just 7 percent say it was designed mostly to help the middle class.

The question is, will the tax-cut gift serve to demonstrate the power of large corporations and wealth individuals or will it undermine their legitimacy?

At least right now, most people seem prepared to refuse the mean gift.

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It’s that time of the year again, when thoughts turn to the impossibility of the gift.

Usually (as in the ghost of Christmases past, e.g., here, here, and here), attention is given over to neoclassical economists, who bemoan the inefficiencies caused by the normal pattern of gift-giving and recommend instead that money be offered, so that recipients can buy their own presents.

This year, things are a bit different. Psychologists are the ones who are called on to identify the impossibility of the gift. In their view (e.g., the research by Jeff Galak, Julian Givi, and Elanor F. Williams and Yan Zhang and Nicholas Epley), as it turns out, much the same problem arises: givers can’t possibly know what the recipients want. 

But, psychologists add, the reverse it also true: recipients often don’t know the motivations of the givers. “It’s the thought that counts” only counts when recipients are somehow prompted to consider a giver’s act of generosity.

If gift receivers consider a gift giver’s thoughts only when triggered to do so, then gift givers are likely to have difficulty correctly anticipating the impact of their own thoughts and intentions. Gift givers, after all, have a very different perspective on the exchange than do gift receivers. Gift givers do not experience the automatic evaluation that comes from receiving a gift and thus would not be triggered to use their thoughts to predict a receiver’s feelings and evaluations in the same way as gift receivers. Thoughts may indeed count for gift receivers, but not necessarily in ways that givers will predict. The capacity to anticipate a receiver’s feelings and evaluations is a critical aspect of gift exchanges because maximizing the receiver’s happiness and satisfaction is arguably the most common objective in gift exchanges. . . Any gap between a gift giver’s predictions and a receiver’s actual evaluations will undermine the primary goal of gift exchanges.

In both cases, when they don’t know what recipients want and try to have their own good intentions recognized, givers are prone to make mistakes in choosing the appropriate gift.

The researchers therefore step in to try to help them, by suggesting gift givers make better decisions: either “choose gifts based on how valuable they will be to the recipient throughout his or her ownership of the gift, rather than how good a gift will seem when the recipient opens it” or “give priority to choosing gifts that receivers actually like rather than gifts that reveal thoughtfulness.”

What none of the teams of psychologists considers (just like the neoclassical economists before them) is that when the gift is something that is offered out of generosity, without an interest or concern in reciprocity, then as soon as the gift is identified as a gift, with the meaning of a gift, then it is cancelled as a gift. The gift, which creates a debt of a return—of an indeterminate reciprocity, concerning when and how—is thereby annulled. And that’s true even with the best of intentions or choices on the part of gift-givers.

But, I hasten to add, that is also the case with monetary exchange, since it is also replete with diverse and conflicting motivations, desires, and concerns on both sides of the transaction. As with gift exchange, those on one side (e.g., buyers) have a very different perspective on the exchange from those on the other side (e.g., sellers).

Consider the example of purchasing a car (which I recently did). The buyer has no idea what goes into the intentions and behavior of the seller: are they attempting to inform the seller of the qualities of the various vehicles being considered, looking to push unnecessary options or extended warranties, worried about meeting their monthly quota, or subject to pressure from the dealership to boost profits? For their part, the seller doesn’t know anything about their opposite number: from the financial situation of the buyer to what they’re looking for in a vehicle, not to mention the condition of any trade-in, the possibility of repeat business, and so on.

And, of course, both buyer and seller are constituted, and transformed in an unpredictable manner, during the course of the long, complex relationship that develops before, during, and after the purchase. It’s a relationship that, at various times during the transaction, both invokes and undermines notions of mutual beneficence, trust, concern, calculation, and much else.

Errors are made, then, in monetary exchange no less than in gift exchange. The goals on both sides of the transaction are only partly fulfilled even when the exchange is completed. Sellers can walk away with another vehicle sold but they don’t know, under all the conflicting pressures, if they did the “right thing” (for the buyer, themselves, their employer, and so on). And buyers, after they drive away, will be affected by all the qualities and features (both positive and negative) they were only dimly aware of when they bought the vehicle, not to mention the comments and questions from family members and friends, which influence how they look at and appreciate their new vehicle. And then of course there’s the depleted bank account or the loan, which determines what the transaction means in terms of their own and others’ wealth and property, the effects on their financial well-being, and what exactly was traded when the vehicle was purchased.

And so we muddle on—exchanging gifts, engaging in monetary transactions, or, as is often the case this time of year, combining the two (purchasing commodities with money to give as gifts)—even when we know the gift and commodity exchange, at least as modeled by mainstream economists and psychologists, are in fact impossible.

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You’d think a Harvard economics professor would be able to do better than invoke horizontal equity as the sole argument for reducing the U.S. inheritance tax.

But not Gregory Mankiw, who uses the silly parable of the Frugals and the Profligates to make his case for a low tax rate on the estates of the wealthiest 0.2 percent of Americans who actually owe any estate tax.*

I’ll leave it to readers to judge whether or not it’s worth spending the time to compose a column on a tax that affects such a tiny percentage of rich—very rich—American households. And then to argue not for raising the tax, but for lowering it.

Me, I want to raise a few, more general issues about how mainstream economists like Mankiw think about inheritance taxes.

First, Mankiw presents one principle—horizontal equity, the “equal treatment of equals”—and never even mentions the other major tax principle—vertical equity, the “unequal treatment of unequals,” the idea that people with higher incomes should pay more taxes. Certainly, on the vertical criterion, those who receive large inheritances (for doing nothing more than being born into and raised within the right family) should pay taxes at a much higher rate than those who do not.

Second, even the notion of horizontal equity—that equals must be treated fairly—depends on an assumption that we each have come fairly to where we now stand. If that principle is violated (as it often is, e.g., because an estate represents the accumulated wealth based on other people’s labor, their surplus labor), then we need to ask if there is even an a priori principle of horizontal equity. The alternative is to judge everyone’s entitlements and burdens, including those occasioned by large inheritances, according to a single theory of equity or justice.

Finally, and perhaps even more important, both the horizontal and vertical equity standards presume that tax justice can be achieved by minimizing the coercive relation between the citizen and the state, which is then counterposed to the freedom guaranteed by a system of voluntary exchange. As Paolo Silvestri explains,

if the problem of the legitimacy of taxation as coercion is posed in terms of ‘voluntary vs coercion’, or freedom vs coercion, the maximum that one can ask it is to minimize coercion and maximize possibilities for voluntary exchanges, and / or minimize the role and size of government and leave as much room as possible to the private sector.

The alternative, of course, is to imagine a very different economic and political relationship, one in which both exchange and taxation—and thus notions of freedom and obligation—are understood in terms of an alternative logic. Consider, for example, the gift. If there is indeed something that the literature on gift economies has revealed it is the fact that social reciprocity—literally, creating and reproducing social relationships through gift exchange—configures the relationship between freedom and obligation in a manner quite different from that presumed by Mankiw and other mainstream economists.

What Silvestri makes clear is the circulation of the gift involves the free recognition (or non-recognition) of the obligation or debt occasioned by the gift, “in the sense that human freedom is asserted as such at the very moment in which it recognizes (or not) his debt.” Taxation, in particular, can be represented as an act of “giving back” to society, the recognition of a relationship of living together beyond the family—which, while never finally solving the tension between obligation and freedom, creates and recreates relations of mutual trust and living in common. It thus redefines the issue of equal or unequal return—the accounting framework of giving and taking embedded in notions of horizontal and vertical equity—in favor of asymmetry and an unending cycle of producing and resolving instances of justice and injustice across society.**

To which the only possible answer is further giving—and thus the freedom of those who have managed to amass great fortunes to comply with the obligation, after they have died, to pay taxes at a high rate based on large accumulations of the social surplus.

 

*There are many other facts about the estate tax Mankiw conveniently leaves out (according to the Center on Budget and Policy Priorities): the effective tax rate is much lower than the statutory rate, only a handful of family-owned farms and businesses owe any estate tax, the largest estates consist mostly of “unrealized” capital gains that have never been taxed, most other rich countries levy some form of estate tax, and the estate tax is the most progressive part of the U.S. tax code.

**My concern here is with the inheritance tax. Silvestri takes his argument in a related but different direction: “the European economic crisis, the restrictive fiscal policies and their social consequences [that] have done nothing but to sharpen the citizen’s distrust in such legal-political institutions, increased their resentments, and even undermined the very possibility of a democratic discussion on taxes.”

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Apparently, Gravity Payments CEO Dan Price [ht: sm] recently received a gift from his employees, a new Tesla.

Price and Gravity gained fame last year when the young CEO announced to much fanfare a plan to raise pay to $70,000 a year for all employees, after a phase-in period. Price said he would also make $70,000, dropping his salary from more than $1 million annually. . .

Gravity spokesman Ryan Pirkle said the gift was thought up and organized by Alyssa O’Neal, an employee who he said was one of the “most impacted” by the raise.

A gift for a gift. Price decided to raise the salaries of his employees, and they reciprocated by buying him a new car.

It’s a heart-warming story. But, as I wrote a year ago,

I’m not prepared to celebrate Price as a “good capitalist,” as against all the “bad capitalists” who are choosing to increase the gap between average workers’ pay and the enormous payments to CEOs.

My point is a actually somewhat different: first, that capitalists—whether in Columbus or Seattle—do lots of different things, and presuming they follow a simple rule (whether profit-maximization as in the usual neoclassical story, or the accumulation of capital in many heterodox stories) means missing out on the complex, contradictory dynamics of capitalist enterprises; and second, that other kinds of enterprises (in which workers themselves make the decisions about how the surplus is appropriated and distributed) would do even more, on a wider scale, to transform the dynamics of the distribution of income and wealth in the U.S. economy.

It’s the difference between an individual gift and a gift economy. In the former, workers are forced to rely on the benevolence of their employer, to whom they feel beholden; in the latter, because they participate in appropriating the surplus they produce, workers actually have the means to regularly bestow gifts on themselves as a collectivity, on whatever bosses they may have chosen, and on the wider society with which they have a reciprocal relationship.

Now, that’s a gift economy worth celebrating.