Wednesday, September 27, 2017

Who is the modern bourgeoisie? Pt. I: Financialization

Marx, in his classic formulation of class struggle, divided society "into two great hostile camps, into two great classes directly facing each other: Bourgeoisie and Proletariat." These classes, he argued, play the two essential roles in the system of economic production known as capitalism. One class - the bourgeoisie - controls almost everything involved in economic production. The other class - the proletariat - controls the one part of production that the bourgeoisie doesn't: their own ability to work. Under capitalism, the bourgeoisie leverages its control of the means of production to exercise control over the entire economy. And inevitably, they use it to create a system of exploitation that works to their own benefit.

Popular and technical use of "proletariat" and "bourgeoisie" has of course significantly evolved since Marx's time, but instead of examining etymology, I would like to ask two different questions. First: does something like Marx's formulation of "the bourgeoisie" exist today? And if so, who are the modern bourgeoisie?

There are no consensus answers to these questions - but in the vast body of literature grappling with them, there are three typical concerns that emerge over and over again:
First, public investment in stocks is thought to have complicated Marx's assumptions about who controls the means of production; 
Second, imperialism is thought to have complicated Marx's class analysis by further dividing society into "first world" exploiters and the exploited "third world"; and 
Third, Marx's class analysis is not intersectional; it fails to account for various forms of identitarian oppression that are equally relevant to the structure and operation of our political economy.
I will, in this series of posts, address each of these points in turn, starting with the first.

Financialization


Though economists have made this same point in greater detail, the challenge of financialization to Marxist theory was most famously (and succinctly) laid out by Camus:
We know that the economic evolution of the contemporary world refutes a number of the postulates of Marx...with the introduction of companies in which stock could be held, capital, instead of becoming concentrated, has given rise to a new category of smallholders...
Hypothetically, this "category of smallholders" would have to include the nearly half of all Americans who, through various financial vehicles, own stock in the means of production. This diffusion of ownership seems to stand in sharp contrast with the economy of Marx's time, in which it was "not uncommon to find...various branches of production controlled by one brain" (Schulz). It also poses a significant challenge to Marxist theory: if anyone, no matter how poor or powerless, can be the bourgeoisie by owning a health savings account or a threadbare 401(k), Marx's theory of power and exploitation has become utterly trivial.

Despite what Camus seems to think, however, Marx was well aware of the complications the stock market introduces into his class analysis. Marx's response was to argue that "the joint-stock company represented a partial separation of ownership and control" (Stephens); he described it as "a new swindle" in which "the functioning capitalist" is "working with borrowed capital" for his own enrichment. By 1904, Heymann had already outlined how the bourgeoisie does this:
..it is possible with a comparatively small capital to dominate immense spheres of production. Indeed, if holding 50 per cent of the capital is always sufficient to control a company, the head of the concern needs only one million...
Lenin adds:
As a matter of fact, experience shows that it is sufficient to own 40 per cent of the shares of a company in order to direct its affairs, since in practice a certain number of small, scattered shareholds find it impossible to attend general meetings, etc...The "democratisation" of the ownership of shares...is, in fact, one of the ways of increasing the power of the financial oligarchy.
What matters then, is not the superficial legal title to ownership - it's actual control of the means of production. This control is determined by an (often deliberately) elaborate and opaque complex of laws and corporate governance rules, but it inevitably tends towards the same outcome: the enrichment of "the functioning capitalist" at the expense of proletarian workers and shareholders. Make this distinction between control and management, and the size of your bourgeoisie contracts dramatically. How dramatically? Wolff's 2013 breakdown paints an indirect picture:


The wealthiest 1% owns as much stock as everyone else in the US. So while widespread public investment has certainly greased the wheel of capital, it has not necessarily democratized control of the economy.

Tuesday, August 15, 2017

Ben Shapiro has changed his mind about antifa

Ben Shapiro, writing for The National Review, gives us the inevitable "both sides are to blame for Charlottesville" take:
There’s still no certain knowledge of who began the violence, but before long, the sides had broken into the sort of brutal scrum that used to characterize Weimer-era Germany. The two sides then carried the red banner and the swastika; so did the combatants on Saturday.
Now they’re growing. And they’re largely growing in opposition to one another. In fact, the growth of each side reinforces the growth of the other: The mainstream Left, convinced that the enemies of social-justice warriors are all alt-right Nazis, winks and nods at left-wing violence...
The antifa response, of course, would be to insist that violence against fascism is justified, and a sign of our commitment to the fight against white supremacy. Clearly, Shapiro now rejects this. But go back just three years, and he clearly had a different view:
This is why it's so comfortable to be on the left: that unearned sense of moral superiority...you are a racist and sexist; they are not...It doesn't matter that if they pointed out a KKK member to you, you'd run across the lot to knock him out; in order for them to be morally superior, you must be morally inferior. (5)
No ambiguity here: as recently as 2014, Shapiro appealed to antifa violence as the exemplar of antiracism, and insisted that of course conservatives would punch ethnonationalists on the streets. This was his explicit proof that the right was just as committed to the fight against white supremacy as anyone else. Since then, it seems pretty obvious what happened to make Shapiro change his mind: fascists took to the streets and became a political liability for the right. In 2014, it was convenient for him to play macho, puff up his chest, and fantasize about attacking members of the KKK - but now that they are such a visible part of his political coalition, Shapiro has to pull his punches.

Sunday, August 13, 2017

Fascism's pincer

Sooner or later, climate change will consume our economy. If we are wise, we will let this happen sooner, and make massive preemptive investments into green energy and sustainable infrastructure; this will cost a lot up front, but it will mitigate even greater costs down the road. More likely, we'll kick the can down the road, and then we'll find ourselves paying for disaster relief, mass migrations, civil unrest, plague, famine, and everything else that comes with global warming. One way or the other, we'll pay. Estimates vary, but the more plausible ones hover around a third of GDP.

In developing countries experiencing significant economic growth, this will be manageable. In developed countries that have already made big investments in infrastructure and green energy, this will be manageable. But in the United States, where growth will probably slow and where our investments are low, this is going to hit our economy pretty hard.

Couple this with so many other trends of late capitalism - outsourcing, inequality, wage stagnation, and so on - and the prospects for your average American over the next fifty years look pretty grim. Liberalism will have no answer for this. It will offer the same useless panaceas it always has - vocational training, targeted tax cuts, business subsidies, and so on - but it will offer them to generations who've only seen their living standards fall and their futures disappear.

Did I mention mass migration?

A discredited ruling ideology, declining standards of living, the memory of lived prosperity and absolute despair for the future: this is as toxic a society as you can imagine. Now add to that waves of immigrants fleeing the storms and heat waves of South and Central America. An increasingly violent, increasingly militarized border, and an increasingly aggressive ICE. The continued decline of white Americans into a national minority. And a wealthy elite, controlling the most powerful propaganda apparatus in history, desperate to find a scapegoat for the country's ongoing deterioration.

This is fascism's pincer: economic pathology on one side, ethnonationalism on the other. A middle class driven by radical resentment. You can already see the first glimmer of this in the polo shirt neoconfederates who spilled blood in Charlottesville yesterday - a frustrated, revanchist mob of white suburbanites who see in their falling monuments the end of their power and prestige. Their rage is already scary enough, but I am telling you that it is only going to get worse.


There is only one way out of this: redistribute to the rest of society the vast wealth hoarded by our (largely white, first world) ruling class. Redistribute the wealth, guarantee to everyone a decent standard of living with all of the necessities that entails, and you can undercut the tribal wars for survival and domination that capitalism constantly threatens to inflame. Redistribute the wealth - particularly to the developing world - and maybe you can buy some time in the fight against climate change, or even soften the blow when it eventually hits.

You are not going to solve all of society's problems by redistributing the wealth. Racism will still be with us. The political and cultural legacy of white supremacy will still be with us. Our planet will still be poisoned and depleted from centuries of industrialized destruction. Fifty years from now, the left will still have plenty of work to do - but if we try to fight these battles when we're caught in fascism's pincer, our chances for survival are slim.

Tuesday, August 8, 2017

Advocates for climate action should stop defending the rich

Emily Atkin, in an article for The New Republic, has written the latest in a recurring genre of articles defending rich advocates for action against climate change. A year or so ago, Vox gave us Rich climate activist Leonardo DiCaprio lives a carbon-intensive lifestyle, and that's (mostly) fine; now, Atkin has set out to establish that Al Gore’s Carbon Footprint Doesn’t Matter. In common, both of these pieces take on a popular right-wing talking point: rich liberals who live carbon intensive lifestyles yet advocate for government action against climate change are hypocrites. This, Atkin argues,
is deceitful faux-populism...climate change advocates who don’t live a carbon-neutral lifestyle aren’t hypocrites because, for the most part, they’re not asking you to live a carbon-neutral lifestyle. They’re asking governments, utilities, energy companies, and large corporations to increase their use of renewable energy so that you can continue to live your life as you please, without contributing to global warming.
Atkin is correct on one thing - the left does need to reckon with the "learjet liberal" rhetoric - but this is not the way to do it. The reason that Rush Limbaugh, Sean Hannity, and other voices on the right have so much success with this attack is that it contains a kernel of truth: climate change is largely the fault of the rich. As Chancel and Piketty detailed a few years back, "top 10% emitters contribute to 45% of global emissions, while bottom 50% contribute to 13% of global emissions." People see Al Gore living a lifestyle that clearly has more of an impact on the world than theirs, and they resent climate change solutions that threaten to make his lifestyle their problem.

Atkin tries to finesse this point by blaming climate change on a series of abstractions - governments, utilities, energy companies, and large corporations - but everyone knows that all of these institutions are controlled by the rich. Later, she leans on an argument by David Vox that the contributions to climate change by individual rich people are insignificant - but this technicality misunderstands the fundamentally classed nature of learjet liberal rhetoric. It works not because people necessarily hate Al Gore in particular, but because people generally resent the rich as a class, and are happy to find targets for their anger.

Fortunately for the left, there's a simple response to this talking point: reclaim class warfare. The fight against climate change has to be understood as a fight against capitalism. If you leave climate action in the domain of private decision making, then of course rich people who make decisions to disproportionately pollute are hypocrites when they call for action against climate change. But if you understand climate change as a fight to take personal discretion out of the equation - to abolish private property, and place these matters in the hands of democratic governance - that's another matter.

Ultimately, the "learjet liberal" rhetoric resembles nothing so much as the old right-wing complaint about leftists who use iPhones. If your solution to the problems of our age just involves better personal decision making in a free market, then yes, there is something inconsistent about criss-crossing the ocean in a private jet or using cheap consumer electronics. But if your solution is to change the system entirely, and to take personal decision-making out of the equation, then it stops making sense to hold one's consumption under capitalism against them.

Sunday, August 6, 2017

Bankers and Big Pharma lawyers: We are the left!

An interesting quote in Melissa McEwan's "Sanders Democrats" Don't Own The Left:
With respect to African-American people...We don't necessarily want to overthrow the system — we want the system to work for us... And to be frank, many of us want the opportunity to be part of a fair capitalist system. We want to see people like us on Wall Street and in the capital markets, so that perhaps some of that capital will make its way into our communities.
This quote comes from Ginger McKnight-Chavers, a Harvard Law School classmate of Michelle Obama's and former in-house attorney for Warner-Lambert (a pharmaceutical company eventually bought out by Pfizer). Her husband, Kevin Chavers, was vice president in the Mortgage Securities Department at Goldman Sachs and Managing Director at Morgan Stanley, and is now Managing Director at BlackRock Solutions, the world's largest shadow bank.

I trust there's no point in reiterating the central role that financial firms like Goldman Sachs, Morgan Stanley, and BlackRock have played in the explosion of income inequality, but it's worth considering how even a smaller company like Warner-Lambert made its money:
When Dr. Franklin joined Warner-Lambert in April 1996, executives there were unhappy with the limited sales potential of Neurontin, he said...To compensate, he said, Warner-Lambert executives created a plan to sell Neurontin for conditions ranging from migraines to manic-depression to attention deficit disorder -- even though such uses were not supported by proper clinical studies...
One day, Dr. Franklin said, a doctor showed him an article stating that Neurontin had worsened the behavior of a child with attention deficit disorder. ''He said, 'You keep telling me it's a benign drug and it's not,' '' Dr. Franklin related. 
Dr. Franklin said he later showed the article to his boss, who dismissed it as an isolated case. He said his boss then laughed and said, ''Well, the doctor should not have been using the stuff off label anyway.''
Eventually, the manufacturer pleaded guilty and paid $430 million in criminal charges and civil liabilities:
“This illegal and fraudulent promotion scheme corrupted the information process relied upon by doctors in their medical decision making, thereby putting patients at risk,” stated U.S. Attorney Michael Sullivan. “This scheme deprived federally-funded Medicaid programs across the country of the informed, impartial judgment of medical professionals -- judgment on which the program relies to allocate scarce financial resources to provide necessary and appropriate care to the poor. The pharmaceutical industry will not be allowed to profit from such conduct nor subject the poor, the elderly and other persons insured by state and federal health care programs to experimental drug uses which have not been determined to be safe and effective."
This is the system that McKnight-Chavers wants to preserve: the system that has made her family wealthy, largely at the expense of some of the most vulnerable and marginalized people in our society. From her position of privilege, it's easy to call for "a fair capitalist system" where "capital will make its way into our communities" - because capital has made it into her community. But why are we making this voice of privilege an arbiter of the left?

Monday, July 31, 2017

Some pretty egregious misrepresentation from Noah Berlatsky

Noah Berlatsky has published some criticism of a recent Katie Halper interview of Angela Nagle. Here's a typical passage:
Halper...bizarrely suggests that what is really needed in discussions of the Holocaust is less focus on anti-Semitism and more discussion of German economic grievances and anger over Versailles...This, then, is the sad endpoint of the dirtbag left's confused efforts to throw the mantle of working class authenticity over asshole racists.
Since Berlatsky is dealing in paraphrases here, I was curious about what Halper actually said, so I decided to give it a listen. Halper:
I think that sometimes the comparisons [between Trump’s America and Nazi Germany] are good, but the point is, the people who are so quick to make those comparisons... they’re very selective in it. So they’ve compared Trump to Hitler, but they won’t… look at the Weimar Republic and how it compares to now, right? I don’t think most of these people would look at the Holocaust and say “it was just anti-Semitism – nothing about the economic collapse, nothing about the treaty of Versailles had anything to do with it.” Maybe they would, and they’re more idiotic than I think, but…
TL;DR - Berlatsky alleges that Halper has called for "less focus on anti-Semitism and more discussion of German economic grievances and anger over Versailles" in "discussions about the Holocaust." But what Halper actually argues is the exact opposite: we already focus on these factors appropriately. Her point is not that we should change how we talk about the Holocaust, but that we should change how we talk about Trump's America. She is holding up our typical discussions of the Holocaust as a standard, in their nuance and sophistication, to which today's discussions of fascism in America should aspire.

I won't add much more except to note that this misrepresentation is pretty typical of Berlatsky's piece.

Democrats may be losing, but centrists aren't

The Hill reports on a push in the Democratic leadership to offer alternatives to Trumpcare - and single payer:
Pelosi and other top Democrats have hailed a series of ACA reforms recently proposed by a small group of centrist New Democrats and conservative-leaning Blue Dogs...Adding to the pressure, almost 90 Democrats endorsed four specific reforms — based on the proposals from the New Democrats and Blue Dogs — designed to prop up ObamaCare’s struggling individual markets.
As some readers have already pointed out, abandoning single payer for a significantly less popular raft of inadequate technocratic tweaks is a great way to lose elections! And once you recognize this, it's easy to conclude - like Jeet Heer did recently - that Democrats are chronically suicidal politicians with a compulsion to lose.

If you measure victory by election and legislative wins marked with the letter D, this is an understandable take. Still, as fun as it is to point out that the clowns in Congress are a bunch of clowns, this is not actually a plausible account of ordinary human goal-driven behavior. People do not ordinarily try to fail; even losers usually want to win. Democrats see the same polls that we do; they know perfectly well that single payer has plurality support among Americans, and majority support among Democrats. Surely they aren't just reflexively running with the least popular option they can find, regardless of what it is, in order to lose - something else must be at work, right?

Here's an alternative theory: Democrats want to win. But for many Democrats, winning means stopping leftist policy outcomes - and sometimes, the best way to do that is to lose elections and lose fights over legislation. If you are a centrist Democrat and your priority is stopping single payer, then of course you are going to offer alternatives to single payer, even if that means risking a Republican victory. You may even be willing to do things like risk the election of Donald Trump for the sake of denying a win to Bernie Sanders - even as critics warn you just how dangerous this is.

That's why the same people who gave us Hillary Clinton are now actively lobbying for anything-but-single-payer. And as in 2016, this has to be understood as a decision to risk losing to Republicans for the sake of derailing the left. That's the defining calculation that leftists miss when they regard centrists as benevolent but incompetent allies; it's an easy calculation to miss, because only the most cynical centrists realize that they're making it. But if you don't see an effective preference for Republicans over leftists in the operation of centrist politics, there's a lot about their behavior you won't be able to explain.