Thinking about Capitalism

It is a common trope that our economy is one of rational actors, objective values, and freely informed choices. Often, when someone attempts to criticize the economic system, they are dismissed as simply "not understanding it." When we point out that the present system isn't working for a great many people (a majority of people) then we are informed that we simply haven't thought about the issue enough. I disagree. I think that those of us who see that the system has long ago left rationality behind are seeing clearer than those who continue to think of capitalism as the end of history, or the culmination and perfection of all economic structures.

Hyper-Capitalism

Rarely is there a single issue underlying some widespread and systemic problem. Instead, there are many issues which culminate in the problems visible on the surface of whatever object is being studied. This being the case, I'll dispense with all pretense at addressing all of capitalism's problems and instead try to talk about one.

Capitalism has broken off from the rational world of means and ends. It has, to use a term I prefer, become hyperized. It is no longer just capitalism, it is hyper-capitalism. Just as in the sci-fi movies and TV shows where characters engage the "hyperdrive" and move at light speed, capitalism has, as a system, broken off from the ordinary world of causes and effects, of means and ends, and now moves at a pace that sets it apart from reason.

As a case in point, look at the fact that our economic output has shifted more and more away from material need fulfillment (the basis of most rational human activity) and into what is called financialization. Financialization refers to the phenomenon wherein the banking and finance sector of an economy begins to constitute a larger portion of that economy's GDP. Under financialization, "money" as a substance used to equate the value between disparate products ceases to function as such. Wall Street bankers and venture capitalists cease pumping money back into the physical elements of production, like factories, farms, and physical products. Instead, short term and high-reward investments become the primary generators of wealth. These financial activities don't end in more real wealth, as in more real material gains. They don't end in new products that serve human needs, or in new material that people can use. They just generate more wealth.

This is why it is so disingenuous, so lame (to put it bluntly), to hear politicians talk about our national economy (and capitalism as a whole) with folksy terminology. They talk about our economy like it were equitable to a family sitting around the dinner table making financial decisions on how to effectively use their limited income. Or, they talk about brick-and-mortar jobs (that is, jobs that involve real physical labor) and sing their praises, but then don't really do anything to disincentive the banking class from funneling more and more money away from productive work and in to short term, high payoff financial schemes.

Financialization is also among the reasons why I say that capitalism, as such, has left the realm of reasonable behavior and become hyper-capitalism.

Of course, while capitalism proper has left the earth behind, we humans, still stuck on the ground, continue to play in the structures that it left for us. We continue the marketing game, but we do so in emulation of capitalism proper. This poses a threat to human beings who, unlike abstract concepts, were never meant to survive in hyperspace.

Our Real Needs

Despite changing from an economy in which wealth is made by making things and doing things into one in which it is made with short-term money games (as in the sort of money-swapping that helped devastate the economy in 2008), our real human needs have not changed significantly.

As human beings, we of course need food, water, clothing, and shelter. We die rather quickly without these things, and when they are not secure we are too wracked with anxiety and dread to do much else besides seek them.

As human beings, we need tools. We don't have the natural strength or self-sufficiency of most animals, so we have to craft things. We need material tools to do this. This includes things like hammers and nails, yes, but also things like stoves to make our food safe, hygienic products (like tooth brushes) to keep our bodies healthy, and so on and so forth. Our phones and computers are also examples of tools that we use to amplify/facilitate our natural need to communicate and organize our work together.

Finally, as human beings we need one another. We need lovers and friends, we need work and play, and we need intellectual stimulation. All of these require at least one other person in our lives, though in reality they require broad networks of people.

One can expand and mold these basic needs in many ways, but they will walk away with roughly the same set of needs. For instance, "property" or "land" might be added to our human need for tools. "Art" could be added to further elaborate our human need for other human beings.

At any rate, our human needs have not changed during our species' long history. Though our dazzlingly complex world may seem as far removed from ancient civilizations as possible, it truly is not. We manipulate information and money faster than ever before, but this has not changed our human-being.

Wasted Wealth and the Con-Game

The first problem which we are presented with is the way in which capitalism pulls wealth and power up and concentrates it. One could imagine that capitalism draws these things up with itself as it rockets away from earth and becomes hyper-capitalism. Whatever power it doesn't bring with it, capitalism leaves in the hands of a very few. Thomas Piketty has written a book called "Capital in the 21st Century" which looks at this concentration of wealth and power in detail.

It should not come as a surprise to point out that the often cited idea of "trickle down" economics does not work. As the structures of capitalism become more complex and divorced from practical reality, the wealth generated tends to simply accrue. It sits in the bank accounts of those who know how to best play abstract money games. The overwhelming majority of this wealth is then broken out of the cycle of productive work. It does not enter into further exchange or production. And, of course, with such immense stores of wealth there comes immense stores of power. We see this at play now in the ways in which mega-wealthy companies and individuals are destroying our system of rational conversation and gaming politics by way of purchasing votes/power.

Interestingly, even the mega-wealthy become enslaved to capitalism's hyperized form. They are steeped in capitalism; pickled in it. Their eyes are held in place by the system of wealth accrual, kept laser focused on short-term money games and wealth producing schemes designed to do nothing but keep piling the money higher. Of course, they are at rock bottom just as connected to the fate of the planet as the lowest worker, so when capitalism finally finishes wrecking the environment they will be just as doomed as we are.

Again, none of this is surprising beyond the sheer audacity and lunacy of it.

What might be surprising is if one thought that people would be rational enough to destroy this insane system before it got out of hand. This is not the case, obviously. The average worker has been more than willing to help facilitate the hyper-capitalism and the devastating consequences it produces which so mark out our historical period. The reason that people have helped position the gun pointed at our collective head is depressingly simple. While it is complex enough to deserve multiple books in its own right, the reason we go along with capitalism could be reduced to a single word: marketing.

Capitalism is very, very good at keeping people from paying attention. In certain areas of the world, it has managed to pull this off thanks to marketing. Those areas are what we would call the "first world" countries.

The vast, vast majority of Americans are in dire financial straights. A simple emergency costing between $500 to $1,000 would wipe out their meager savings and leave many in debt (or more debt).

Why, then, haven't we risen up and done something about this hyper-concentration of wealth and power? Or at least demanded a better safety net for the rest of us?

The answer is coffee shops.

Well, not just coffee shops. It is coffee shops, iPhones, laptops, nice clothes, and everything else that even (most) poor Americans can afford to obtain.

Many Americans who are too poor to afford an emergency can still afford to go to the "nice part of town". They can afford to go to hip coffee shops and get fine drinks and fancy little meals. They can afford to sip indulgent drinks that movies and television show us as being signs of high-culture and affluence. They can (on occasion) afford nice clothing or flashy toys, like a new X Box. They can afford iPhones. They can afford these things even as their real wealth and their real power (and thus their real safety) continue to diminish under late stage capitalism.

The reason they can get away with this is that capitalism works to suppress real prices by suppressing the value of real labor. The reason that this lifestyle doesn't immediately strike us all as intolerably horrifying is due to clever and constant marketing.

Coffee, just for example, is an expensive product to produce, ship, and prepare. Yet we in the developed world can enjoy it at cheap prices. Ditto for those other indulgences. Together, all of these indulgences add up to give us the illusion that we are living a financially healthy and safe life. Thus, even though in the back of our mind we know that one mishap could wipe us out, we keep playing the game. Even as the "middle class" shrinks away, many of us can continue to pretend at being middle class so long as literally nothing breaks or goes wrong.

Marketing not only trains us to associate these absurdities with high-status, but it also keeps us from ever feeling satiated. We can never rest and simply enjoy the treasures we accumulated. Marketing is always broadcasting the next "big thing". And enough people fall prey to these simple status-chasing games to make it work. Even if you tell yourself that you're going to sit out the next big style or trend, you'll probably still feel at least a slight pang of unpleasantness when everyone around you is enjoying it.

(Of course, all of this ridiculous make-believe is only possible because elsewhere capitalism is not so kind as to play nice. Where the raw materials of our artificially cheap indulgences are produced, capitalism operates and the end of a gun barrel or in the raw, brutal threat of immanent starvation to produce what are obviously forms of slavery despite their paltry 'wage'. Your chocolate and coffee are cheap because the men and women who harvest them aren't paid enough.)

Conclusion

So that's the game we're all currently stuck in. Capitalism operates on levels of speed and complexity that few can understand. It has become, in its highest instantiations, almost wholly divorced from the real world, of real productivity and real labor.

But we continue to do nothing about it, because so long as it keeps offering us the illusion of safety and progress via constant marketing and artificially cheap goods, we tacitly agree to go along.