Wednesday, November 9, 2011

The Ethical Horizon of Modern Capitalist Society

"Living standards are not fully insurable because of moral-hazard problems: if people or organizations knew that their incomes were guaranteed regardless of the amount of effort that they put in, then there would be a markedly reduced incentive to make efforts to maintain income… Moral hazard is not total: people and organizations do continue to function even if their incomes do not depend on it; but the inefficiencies created by such total insurance are so significant that they cannot be ignored…

The revolutionary social thinkers described above could not see the fulfillment of their vision for communal sharing of income uncompromised by moral hazard unless there is development of a new community spirit, a new concern among the general public for others. But efforts to create such community spirit in society at large have not been successful enough to make possible the envisioned voluntary sharing. There are some stories of successes of utopian communes that completely pool all incomes, such as the Hutterites of North America, the kibbutzim in Israel, and the Itto-En and Yamagishi-Kai of Japan, but these communes, based on a sense of group feeling and intimacy built from shared experiences, are effectively large families. Usually a commune has no more than a few hundred members. Each commune is too small to allow much of the risk sharing envisioned here. Moreover, many of these utopian communes find that their community spirit declines somewhat through time and that private property becomes more important. Established communes may, for example, allow new members to retain possession of their preexisting wealth."

Robert Shiller, Macro Markets, 1993

This is a very brief summation of the most common ethical argument against reorganizing social resources towards 1) guaranteed minimum quality of life for all human beings, including adequate housing, food, transportation, education, healthcare, clothing, and personal security, and 2) the utilization of those resources towards the simultaneous minimization of human labor time, the qualitative improvement of what that time entails, and for the maximization of freely disposable time.

When I say 'most common', I mean that whatever other objections I bring up to capitalism, this is the discussion-closing, "I've shut you off now" argument I hear from managers, supervisors, small business people, software engineers, call center workers, mechanics, control room operators in power plants, baristas, and union organizers.

This is so partly because there is no substantive material argument against ending poverty and insecurity, and their myriad side-effects, since we have for many decades had the capacity to reduce the amount of human labor required to meet these goals to a mere fraction of the typical work week of between 35 and 60 hours. For only a small portion of the world's population would this entail any less material wealth, and for the overwhelming majority it would entail a dramatic increase. Further, in improving the material quality of life, it would generally increase the personal security of individuals and families by reducing property crime, violent crime, "economic insecurity", and so on.

If we unpack this just a little, the ethical claim of "moral hazard" becomes the following: without the actuality of mass misery with which to threaten the rest of the world, "those" people won't work, growth (an unquestioned end in itself) will stop, and the result will be privation, starvation, and tyranny. In other words, to avoid this moral hazard state, it is necessary for tens of millions to die from preventable causes yearly; it is necessary for over 3 billion people to live subject to constant violence and crushing poverty (based on a poverty line of living on less than $2.50/day, which obviously vastly underestimates poverty in the wealthiest countries); it is necessary for most of the rest of the population to live with anxiety and the fear of falling into this absolute poverty; it is necessary for the vast mass of humanity to spend most of their waking life laboring; it is necessary to support tyrannical regimes globally, to violently repress dissent even in so-called democracies, and to retract or restrict every prior gain in human liberty. All this is necessary to avoid the "moral hazard" dilemma that is the ethical horizon of modern capitalist society.

Whatever its logical shortcomings, the "moral hazard" ethic is an extremely wide-spread view with all of the cache that comes with being on the side of 'the way it is'.

The mass base of today's communitarian right-wing populist tendencies may be frequently racist, sexist, national chauvinist, but their grounding ethic across frontiers is that of moral hazard. It is a politics of ressentiment against both those whom the moral hazard ethic disciplines/punishes and those who might use politics as a means to soften that discipline/punishment. From this perspective, Liberals are communists because they do not accept this logic of moral hazard without qualification and accept into the community of citizens those who violate the ethical injunctions of moral hazard.

Liberals are frequently confused, however, as they do accept the moral hazard ethic, but as mentioned, in a qualified form for the sake of fairness and social peace. Rational adjustment and fairness supersede ethical purity and in fact a certain ironic sneering or personal horror at the evident ethical hypocrisy, meanness, irrationalism, and intellectual bankruptcy of the populist Right is de rigueur. Completely lacking however is an alternative which is more than tweaking and mitigation, despite the magnitude of the problems at hand.

If the Right seems mean-spirited and reactionary, aggressive and insular, liberalism appears rational but spiritless, worldly but passive.

Whatever their differences neither one questions the dominant position and autonomy of civil society. One seeks to restrict the political sphere to technocratic administration and demands that people act 'rational', 'civil', 'polite' in a world deeply in distress with crisis piling upon crisis. There is a certain demand to behave as if nothing was wrong. The other seeks to restrict the political sphere to those who belong to 'the community', to the elect. They very much recognize a world in crisis, that problem piles upon problem, but they are not responsible for any of the problems. The fault lies with Them, not Us. We should rule because They are not of the right pedigree (not white, not hard working, not male, not straight, not 'Americans', not credit-worthy, etc.) Both sides agree however that we cannot afford the moral hazard of using our resources and energy to provide a good quality of life for everyone.

The argument of moral hazard should not be taken lightly. It is not enough to show that the populist Right is stupid, hypocritical, self-serving, etc., or to declaim that a liberalism that accepts the premises of moral hazard has to throw out all of the other ethical precepts to which it once held.

In order to get to the root of the moral hazard claim, we have to take issue with the very way it poses the problem, that the betterment of the human condition requires that the 'lazy majority' of humanity forever feel the literal or metaphorical whip of poverty, debt, fear, violence, anxiety at their backs. We need to take on the assumption that capitalist society is miraculously not to blame for the misery of the world, even though it lacks even a pretend challenger, exactly because it has the appearance of a natural order rather than a form of domination. Finally, we need to challenge the moral hazard argument as a way of evading responsibility for the problems in the world.

This is one way in which I disagree with the Occupy X populist logic of 99% vs. 1%. The 99% is no less responsible for the state of the world because it is a world of our own making. We are 100% culpable for the reproduction of this world, individually and collectively. This culpability for the creation of this society is also the source of our capacity to unmake it. Culpability and capacity meet in us, in what we are willing to hazard, to proceed with what we have to hand without withdrawing into a pure ethics or a Real Politik.

I wish I had some certainty, but I think we are always forced to find our own way forward afresh.

"...proletarian revolutions, like those of the nineteenth century, constantly criticize themselves, constantly interrupt themselves in their own course, return to the apparently accomplished, in order to begin anew; they deride with cruel thoroughness the half-measures, weaknesses, and paltriness of their first attempts, seem to throw down their opponents only so the latter may draw new strength from the earth and rise before them again more gigantic than ever, recoil constantly from the indefinite colossalness of their own goals – until a situation is created which makes all turning back impossible, and the conditions themselves call out:

Hic Rhodus, hic salta! (Here is the Rose, Dance Here!)" Karl Marx, 18th Brumaire of Louis Napoleon Bonaparte

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