Seventeen Contradictions and the End of Capitalism (31 page)

Karl Polanyi understood these relations all too well, though from the other side of the political argument. ‘The passing of market-economy,’ he hypothetically wrote, ‘can become the beginning of an era of unprecedented freedom. Juridical and actual freedom can be made much wider and more general than ever before; regulation and control can achieve freedom not only for the few, but for all. Freedom, not as an appurtenance of privilege, tainted at the source, but as a prescriptive right extending far beyond the narrow confines of the political sphere into the intimate organization of society itself. Thus will old freedoms and civil rights be added to the fund of new freedom generated by the leisure and security that industrial society offers to all. Such a society can afford to be just and free.’

The difficulty of achieving this extension of the realm of freedom lay in the class interests and the entrenched privileges that attach to great concentrations of wealth. The affluent classes, secure in their own freedoms, resist any restrictions on their actions, claim they are being reduced to the status of a slave to socialist totalitarianism and ceaselessly agitate for the extension of their own particular freedoms at the expense of others. ‘Free enterprise and private ownership are declared to be essentials of freedom. No society built on other foundations is
said to deserve to be called free. The freedom that regulation creates is denounced as unfreedom; the justice, liberty and welfare it offers are decried as a camouflage of slavery … This means the fullness of freedom for those whose income, leisure and security need no enhancing, and a mere pittance of liberty for the people, who may in vain attempt to make use of their democratic rights to gain shelter from the owners of property.’
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Thus does Polanyi construct a telling rebuttal to the central theses of Friedrich Hayek’s
Road to Serfdom
, written in 1942–3 but to this day a bible of the libertarian right and a mightily influential text (having sold more than 2 million copies).

Clearly at the root of the dilemma lies the meaning of freedom itself. The utopianism of liberal political economy ‘gave a false direction to our ideals,’ notes Polanyi. It failed to recognise that ‘no society is possible in which power and compulsion are absent nor a world in which force has no function’. By clinging to a pure free-market view of society it ‘equated economics with contractual relationships, and contractual relations with freedom’.
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This is the world that libertarian Republicans construct. It is also the view of individual liberty and freedom embraced by much of the anarchist and autonomista left, even as the capitalist version of the free market is roundly condemned. It is impossible to escape the contradictory unity of freedom and domination no matter what politics are espoused.

The political consequence was, Polanyi argued, that ‘neither voters, nor owners, neither producers, nor consumers could be held responsible for such brutal restrictions of freedom as were involved in the occurrence of unemployment and destitution’. Such conditions were the result of natural causes beyond anyone’s control and for which no one in particular was responsible. The obligation to do anything about such conditions could be ‘denied in the name of freedom’.
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The House of Representatives in the United States with its Republican majority can happily vote to cut off food stamp aid to an increasingly impoverished population (while affirming the subsidies paid out to agribusiness) in the name of supporting the cause and increasing the realm of freedom. We cannot, Polanyi concluded, approach the question of freedom without first discarding the utopian vision
of classical political economy and much of its cognate libertarian politics. Only then could we come ‘face to face with the reality of society’ and its contradictions. Otherwise, as is today most spectacularly the case, our freedoms are contingent on the denial of social reality. This denial of reality is what most right-wing discourses, such as that of President Bush, accomplish so precisely.

The inner connection between conceptions of liberty and freedom and capital, mediated through the utopian writings of the political economists, should not be surprising. After all, the extraction of surpluses from labour presupposes the domination and the relative unfreedom of labour under the rule of capital. As Marx ironically noted, labourers are free in the double sense: they are free to sell their labour power to whomsover they like, at the same time as they have been freed from control over those means of production (for example, the land) which would permit them to make a livelihood other than that defined by wage labour. The historical divorce of labour from access to the means of production entailed a long and continuing history of violence and coercion in the name of capital’s freedom of access to wage labour. Capital also required a freedom to roam the world in search of profitable possibilities and this required, as we earlier saw, the eradication or reduction of physical, social and political barriers to its mobility. ‘Laissez-faire’ and ‘laissez-passer’ became the watchwords of the capitalist order. This applies not only to mobility but also to freedom from regulatory interference, except under those circumstances where external damages to other capitalists or to the economy as a whole became so totally unacceptable or so dangerous as to mandate state interventions. The freedom to pillage resources from under the feet of local and indigenous populations, to displace and despoil whole landscapes where necessary, to stretch the use of ecosystems up to and in some instances well beyond their capacity to reproduce all became a key part of capital’s necessary freedoms. Capital demands that the state protect private property and enforce contracts and intellectual property rights against the threat of expropriation, except in cases where the public interest (usually a stalking horse for capital itself) demands.

None of the freedoms that capital needs and demands has passed uncontested. Indeed from time to time the contestation has been fierce. Capital’s freedoms clearly rested, many people recognised, on the unfreedom of others. Both sides, Marx noted, had right on their side, as capital sought to extract as much labour time as possible from the workforce while the workers sought to protect their freedom to live their lives without being worked to death. Between two such rights, Marx famously said, force decides. But this was the exploitative world that the political economists justified in the name of a utopian programme of universal progress that was supposed to redound to the ultimate benefit of all. But if, said Marx, the true realm of freedom begins when and where necessity is left behind, then a political economic system that is based on the active cultivation of scarcity, impoverishment, labour surpluses and unfulfilled needs cannot possibly allow us entry into the true realm of freedom, where individual human flourishing for all and sundry becomes a real possibility. The paradox is that automation and artificial intelligence now provide us with abundant means to achieve the Marxian dream of freedom beyond the realm of necessity at the same time as the laws of capital’s political economy put this freedom further and further out of reach.

The corrosive power of capital’s economic reasoning sadly works its way into the heart of deeply felt humanist efforts to extend the realm of freedom beyond the gated communities in which the rich and wealthy of this world are increasingly imprisoned. Consider, for example, the exemplary work of Amartya Sen, who in his book
Development as Freedom
strives mightily to push economic reason to its humanitarian limits ‘in the name of freedom’. Sen understands freedom as both process and what he calls ‘substantive opportunities’. The distinction is important for it harbours a critique of a traditional welfare statism that treated the workers and the populace in general as mere objects of policy rather than as subjects of history. For Sen it is just as important to mobilise the populace and to develop its capabilities as active agents in economic development as it is to bring the people to a state where they have the necessary substantive
opportunities (access to material goods and services) to live a valued life. He notes, correctly I believe, the many instances in which subjects would willingly trade in substantive freedoms in order to freely participate in the active and unalienated pursuit of their own fates and fortunes. Slaves and serfs may have been substantively better off than wage workers, but the latter would be unlikely to trade away their relative freedom as wage workers for that reason. Freedom to participate and to develop one’s own capabilities is crucial as a means of achieving development. This is far preferable to substantive changes, however impressive, being imposed and orchestrated by alien and often paternalistic state powers. Sen uses this perspective on freedom ‘in the evaluative analysis for assessing change and in the descriptive and predictive analysis in seeing freedom as a causally effective factor in rapid change’. These processes of development work through ‘a variety of social institutions – related to the operation of markets, administrations, legislatures, political parties, nongovernmental institutions, the judiciary, the media, and the community in general’. All of these, Sen argues, can ‘contribute to the process of development precisely through their effects on enhancing and sustaining individual freedoms’. Sen seeks an ‘integrated understanding of the perspective roles of these different institutions and their interactions’, along with an appreciation of ‘the formation of values and the emergence of evolution of social ethics’. The result is a diverse field of freedoms attaching to a variety of institutions and activities that cannot be reduced to some simple formula ‘of accumulation of capital, or opening up of markets, or having efficient economic planning’. The unifying factor here is ‘the process of enhancing individual freedoms and the social commitment to bring that about … Development is indeed a momentous engagement with freedom’s possibilities.’
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The problem, of course, is that Sen’s vision, however attractive, is in the end yet another version of the utopianism of liberal political economy. Freedom becomes not an end but a means of what Michel Foucault calls ‘governmentality’. It is
through
freedom that the self-discipline of whole populations is managed by state power and it
is that self-discipline that assures conformity and compliance with bourgeois institutions and ways of life, including, of course, capitalist class domination in terms of its cumulative wealth and power. In other words, the end is not in question and does not have to be challenged in the name of freedom because freedom is incorporated in the process. This is what ‘development as freedom’ means.

Sen depicts a contradiction-free world. He does not recognise the overwhelming force of the class antagonisms (of the sort that Polanyi clearly notes), the tense dialectical relation between freedom and domination, the power of private persons to appropriate social wealth, the contradictions of use and exchange value, of private property and the state. To be sure, the oppositions get mentioned, but all of them, in Sen’s universe, are manageable. That any of them might become absolute contradictions and the locus of crisis is ruled out by assumption or merely put down to bad management. Sen’s laudable and deeply attractive attempt to ground an unalienated approach to freedom through process presumes a non-contradictory version of capital’s universe. This is the utopian universe that Polanyi clearly sees we have to abandon if we are to bring society into a world where real substantive freedoms can be achieved instead of an idea of freedom that denies social reality.

I do not pick on Sen for arbitrary reasons. Of all the economists he has gone as far as possible, it seems to me, in exploring the possibilities for the extension of freedom by way of a regulated and socially responsible form of market capitalist development evaluated against noble humanist ideals as opposed to crass measures of development. But his core belief, for which he can provide no definitive evidence, lies in the idea that the market system, properly regulated and managed, is a just and efficient way of fulfilling human wants and needs and that it can produce freedom from want in a free way. The contradictions inherent in the money form are nowhere to be seen even as the moneylenders are daily ravaging the livelihoods of impoverished populations throughout his beloved India. This is the kind of liberal humanism that dominates in the world of the NGOs and philanthropic organisations seriously committed in their heads
and their hearts to the eradication of poverty and disease but with no real idea of how to do it.

In an astonishing and revelatory mea culpa published in the
New York Times
, Peter Buffett, a composer of music and son of the legendary billionaire investor Warren Buffett, recounts his encounter with the world of capitalist philanthropy consequent upon receiving a donation from his father to set up a charitable foundation some years ago. Early on, he recounts, he ‘became aware of something I started to call Philanthropic Colonialism … People (including me) who had very little knowledge of a particular place would think they could solve a local problem … with little regard for culture, geography or societal norms.’ Investment managers, corporate leaders and heads of state were all ‘searching for answers with their right hand to problems that others in the room have created with their left’. Even as philanthropy becomes a massive business (with 9.4 million people employed giving away $316 billion in the USA alone), the global inequalities continue to spiral out of control ‘as more lives and communities are destroyed by the system that creates vast amounts of wealth for the few’. Philanthropy becomes a form of ‘conscience laundering’ which merely ‘allows the rich to sleep better at night, while others get just enough to keep the pot from boiling over. Nearly every time someone feels better by doing good, on the other side of the world (or street), someone else is further locked into a system that will not allow the true flourishing of his or her nature or the opportunity to live a joyful and fulfilled life.’
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The concordance of Buffett’s aims with those of both Sen and Marx is striking, as is the sad history of a bourgeois reformism that never solves social problems, but just moves them around.