From: Mark Steven Heyman (markheyman@infoproconsulting.com)
Date: Sun Dec 05 2004 - 19:58:33 GMT
Hi all,
I know some of you MOQers are not at all interested in economics or
politics, so I've started a new thread for easy filtering.
A few people here have insisted, repeatedly, that so-called free-
market capitalism is the highest quality form of socio-economic
organization. I think that this is an important issue, and would
like to explore it further.
To get started, I'd like to post an email exchange between Noam
Chomsky and one of his readers. Please feel free to attack, defend,
or just discuss any portion of the exchange. If you want to take
issue with something NC says, I will gladly forward your message to
him. He's remarkably good about replying.
Here's the exchange, question first, then the reply.
Thanks in advance to anyone who wants to participate. I truly do
value your opinions, and will welcome any thoughtful comments.
Best
Mark Steven Heyman (msh)
>Professor Chomsky,
>I recently had a couple of arguments with some people
about Capitalism. They claimed that Capitalism was the
best and only viable system, I argued that Capitalism
is a horrible system that is the root of all the
problems. However, I was at a loss to refute some of
their claims. Below are some of their main points.
Maybe you could give me some fuel to beef up my
argument?
>1. Capitalism gives people incentive to produce,
innovate, work, both monetarily and in class status.
Other systems do not and cannot produce good incentive.
(Is there any viable alternative source of incentives?)
>2. The classic - People vote with their dollars, what
they like they buy and thus those things are supported.
(I actually refuted this one somewhat with the example
of the media, we don't exactly WANT to see all the crap
on T.V.)
>3. Great intellectuals like Milton Friedman and Adam
Smith advocate capitalism, how could I challenge these
great minds?
>4. "All other systems that have been tried have
failed." (Russia, Cuba, this argument is a joke.)
>5. Capitalism is the only viable system, that's why
it's the only one that is still functioning.
>6. The competition inherent in capitalism creates
innovations and produces things that would not be
possible in other systems.
>Thank you so much for all you do.
BEGIN CHOMSKY
I'd suggest that you transfer this to the Parecon
forum, which is concerned precisely with this question.
However, a few comments below -- though, frankly, this
specific discussion is framed in terms so objectionable
that I personally doubt that you should even
participate in it. Some comments below.
>1. Capitalism gives people incentive to produce,
>innovate, work, both monetarily and in class status.
>Other systems do not and cannot produce good incentive.
>(Is there any viable alternative source of incentives?)
Is "capitalism" supposed to be something like the
system in the US? Or Japan? Or...? If not, we are
proceeding in outer space. If so, then it is unfair to
say that the claims are unargued: they appear to be
instantly refuted even by the most superficial
examination. Has great science, art, music, etc., been
produced by people working for money? Is that what was
driving Einstein when he was working on relativity
theory in the Swiss patent office, or later at the
Institute for Advanced Study? Or artists struggling
for years on crusts of bread in garrets? Or artisans
throughout history, and today, trying to create objects
of beauty and perfection? Or parents devoting time and
energy to raise their children properly (creating
"human capital," in the terminology of economists, a
major factor in economic growth)? Or in fact just
about anything worthwhile or constructive? The
unargued claims that you are being asked to disprove --
a framework that makes no sense in the first place --
are apparently being put forth by people who have
not had even the slightest experience, direct or
indirect, with creative work, now and in the past --
and by "creative" I do not mean only the peaks of human
creativity, but the lives of most decent people who are
not utterly pathological.
Suppose that there is some miraculous difference
between scientists, artists, artisans, parents, etc.,
and those seeking to produce marketable goods -- a
near-lunatic assumption, but let's adopt it for the
sake of argument. So take the core of the fabled "new
economy," for example, what you and I are now using:
computers and the internet. How were these developed?
Answer, pretty much like most of science, the arts,
crafts, etc. All produced in labs, often for decades,
mostly within the dynamic state sector of the economy,
with essentially no consumer choice or entrepreneurial
initiative. Unless you count the "entrepreneurial
initiative" of IBM executives who realized that they
could use public resources, like the MIT Whirlwind and
Harvard Mark series of computers in the 1950s and the
work going on in the labs, to learn how to switch from
punched cards to electronic-based computing, or their
"entrepreneurial initiative" in relying on government
procurement (that is, unwitting public subsidy) to
develop more advanced computers in the 1960s, or the
initiative of AT&T to rely 100% on government for
procurement of high quality transistors ten years after
they were invented (largely using government-produced
technology, and within a great lab that AT&T,
theoretically private, was able to maintain at public
expense by charging monopoly prices, thanks to
government protection), and so on. I happened to be in
the electronics lab where a lot of this was going on at
the time, but even the most casual acquaintance with
the history of technology, hence the source of the
modern economy, reveals that this is completely
standard: people working very hard, all hours of the
night, because they find their work fascinating and are
passionately interested in finding out the answers to
hard questions, just as artists labor often in penury
to satisfy their inner creative needs, parents devote
enormous efforts to "producing human capital" (in the
familiar ugly terminology), etc. Most of human life,
in fact, for anyone who has taken the trouble to
observe or participate in the world.
One might add that these were also the standard
assumptions of the founders of classical liberalism --
the conceptions that those who you are arguing with are
supposed to revere: von Humboldt, for example, who took
it to be obvious that people are born to "inquire and
create," and it is an infringement on their fundamental
nature to deprive them of this right -- and further,
that if an artisan produces a beautiful object on
command, we may admire what he does but despise what he
is, because he is not a free creative person acting
from inner creative need, but a tool of production
controlled externally.
The more general question is whether it is even worth
debating arbitrary claims for which no argument is
offered, and, furthermore, based on assumptions that
are so massively refuted by even the most casual
observation, let alone serious inquiry.
>2. The classic - People vote with their dollars, what
>they like they buy and thus those things are supported.
>(I actually refuted this one somewhat with the example
>of the media, we don't exactly WANT to see all the crap
>on T.V.)
Why do businesses spend hundreds of billions a year on
advertising? Is it to develop the free markets of
doctrine in which informed consumers make rational
choices? Or is it to "create wants," to pursue what
Adam Smith called the basic objective of "merchants and
manufacturers": to "oppress" and "deceive" the public?
All of this seems too obvious even to waste time
discussing.
>3. Great intellectuals like Milton Friedman and Adam
>Smith advocate capitalism, how could I challenge these
>great minds?
Let's put aside Friedman, out of politeness, and keep
to Smith, a very important figure. He was pre-
capitalist in his conceptions, and often quite
interesting. For example, his basic argument for his
rather nuanced views about markets: that under
conditions of liberty they would lead to equality, an
obvious desideratum. Or his one use of the term
"invisible hand" in "Wealth of Nations," in an argument
for what economic historians call "home bias," in
effect an argument against what is now called
"neoliberalism" or "neoclassical economics." Smith
argued that the English economy, what he cared about,
would be wrecked if British capitalists were to invest
abroad and import from abroad, but it would not be a
problem, because "home bias" would lead them to invest
at home and use domestically-produced goods, and
therefore, by an "invisible hand," Britain would be
saved from the ravages of international markets. Or
his argument against division of labor, and insistence
that in any civilized society, governments would
intervene to constrain it, because it would turn
working people into creatures as stupid and ignorant as
a human creature can be -- essentially on von
Humboldt's assumptions.
Yes, Smith is very much worth reading, whether one
agrees with his interesting work or not. Reading, not
worshipping on the basis of concocted mythology.
>4. "All other systems that have been tried have
>failed." (Russia, Cuba, this arguement is a joke.)
Yes, a joke, and one in particularly poor taste. And
capitalism hasn't failed?
>5. Capitalism is the only viable system, that's why
>it's the only one that is still functioning.
First, nothing remotely like capitalism exists. Is the
US economy, relying crucially on the dynamic state
sector, a capitalist economy? But putting that aside,
was it an argument in the 18th century to say that
feudalism, absolutism, rule by Kings, slavery,.... are
the only viable systems because they are the only ones
still functioning? Or in the 1960s to say that women
can't be granted elementary rights because such rights
aren't granted in any viable system? Or that freedom
of speech must be blocked by state power for the same
reason? This is beyond absurdity.
>6. The competition inherent in capitalism creates
>innovations and produces things that would not be
>possible in other systems.
Have a look at the actual history of innovation, as
barely hinted above.
And also, note the way you are being trapped into
wasting time. Among rational people -- say, in the
normal practice of the sciences -- someone who puts
forth a thesis is expected to provide evidence and
argument for it, not to just shriek it from the
rooftops and challenge you to show that it is wrong.
The debate into which you are being trapped works in
quite the opposite way. By participating in it, you
are immobilizing yourself and allowing free rein to
those who prefer to shriek from the rooftops. I think
it's worth asking whether that is a sensible procedure.
Noam Chomsky
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