The Obnoxious Romance of Capitalism

Twitter ScreenYesterday, I said something on Twitter which should have been relatively uncontroversial. I stated that capitalism had evolved to the point where profits had been privatised and risk had been socialised. This isn’t an original insight; it has been stated with more eloquence and at greater length elsewhere. However I was challenged by a radical libertarian who suggested that the problem wasn’t “capitalism”, per se, but rather a lack thereof. In his opinion, the remedy was “more capitalism”. He patronised me further, stating I ought to read Hayek and Mises, which I’ve already done.

I’ve heard his point of view before; it’s nothing new. I pointed out that the banks had been apportioned “more capitalism”, i.e., reduced regulatory shackles, on the understanding that they would take responsibility for themselves. When the rain inevitably came, I stated, they turned to the government for shelter. In other words, they didn’t live up to their part of the bargain. It might have been emotionally satisfying to see the banks go up in flames, but given how many people’s lives would have been affected by the collapse of the financial system, the government probably had no choice but to prop the system up. However, to suggest that banks were ready and capable for yet more “freedom” was ludicrous: Edmund Burke once suggested that men were apportioned liberty in proportion to their ability to constrain appetite. The banks wanted to devour everything; the state should be taking away their M&S chocolate cake and sending them to Weight Watchers.

I made one more point before the libertarian desisted. I re-stated something once said by Slavoj Zizek: that true believers in the free market are as tiresome as those who still persisted in their belief in Communism despite its multiple failings. Doctrinaire Communists, Zizek stated, kept on saying that what existed in the Soviet Union wasn’t “true” Communism; the problem is that no scenario, as it involved imperfect human beings, could ever be pristine enough to match the ideal. Similarly, capitalists complain that there are too many regulations and restrictions, even though Britain’s system was so light touch as to be effectively absent. I said that anyone who makes a fetish of either the market or the state is dangerous: dependence on too much of either prevents looking at matters soberly.

Knight Errant and Lady FairDoubtless, nothing I said penetrated the consciousness of the libertarian. It’s likely he ran back to his beloved Austrian economists and reassured himself that markets were rational pricing mechanisms rather than a magnifier of people’s opinions, beliefs, passions and prejudices and thus utterly irrational. I suspect he was American; perhaps the most rare phrase I heard while I was in the States recently was “market failure”. There may be little which truly unites the folks in the States these days, but there is a majority that still believes wholeheartedly in the free market. CNBC and Fox Business News were utterly shameless in their worship of business. Bill O’Reilly stated that “letting the market rip” was the only way out of America’s present economic morass. I heard one political radio host suggest that more capitalism would make matters “perfect”. This comment in particular reminded me of the idealised phase of love, in which all of life’s answers appear to manifest themselves in the adored other: this is the point when poetry takes wing and rationality is stilled. Unlike love, fetishising the market doesn’t move on to a more sober stage in which one appreciates another person despite their faults, which in my opinion is a more profound and transcendent love than an affection for the ideal. As the ideologues can never admit that their beloved has warts and faults and failings, it stays out of their grasp, rather like a medieval narrative in which the knight errant is separated from his beloved by castle walls and catches only the occasional wisp of perfume and a sigh from afar. Because the romance is never consummated, it can remain pristine; this lack is also an excuse not to dismiss it as foolish nonsense.

The problem is that in reality the romance has not only been consummated, it has repeatedly raped the general public; we merely need to ask if since the 1980’s if there has been more stability or less, greater inequality or less. Furthermore, we need to ask if left to themselves, are the banks constrained by anything but the limits of avarice; we already know the answer to this question. We need to ask if the privatised services in Britain are delivering value for money; a look at train fares suggests that they are not. Indeed, Britain’s rail tickets are the most expensive in Europe. The facts are clear, but the fetishists persist. Perfection has not been achieved; the exquisite maiden of pure capitalism with her golden braid sits in the distant tower of the castle, awaiting to be freed and to bring to us all into her warm embrace, quickening our spirits with her kiss.

It was obnoxious to hear Soviet communists claim that theirs was a workers state given the contrast between Leonid Brezhnev’s luxurious lifestyle compared to the life of the average citizen. A joke from the 1970’s illustrated the paradox:

Leonid Brezhnev invites his mother to visit his palacial dacha on the Black Sea. Prior to her arrival, he’s extremely nervous that everything is just right; he wants to show her that he’s done well. When she comes, he takes her on a grand tour of the vast gardens, the enormous hall with marble floors and points out the huge crystal chandelier. His mother remains silent, nodding occasionally.

Unable to constrain himself any longer, Brezhnev asks her, “So, Mama, what do you think?”

“Well Leonid,” she replies, “it’s all very good, but what will happen when the Bolsheviks come?”

It’s even more obnoxious after all we have seen and experienced, to hear that the cure to what ails is more of the same poison. It’s troubling that so many people are susceptible to this idea: perhaps it’s because one of the problems with our fast food, instant finance, big broadband age is that we look for the quickest route to any solution. The capitalists say, read Mises, read Hayek, ignore objective reality and practical experience. Believe in the distant beauteous maiden and call to her, disregard the hard, malicious glint in her eye, she will respond. If she doesn’t, well then you simply weren’t pure enough in your belief. Forget having to unpick the complicated and difficult realities of being, living and working; just keep giving unto her until you have no more.

There’s one slight problem: we have no more to give. Sometimes love is self-defeating; sometimes one is defeated by it. The wise individual at this point walks away: only fools and madmen persist.

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