(Economic) Selfhood not Serfhood

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Chris Dierkes

Chris Dierkes (aka CJ Smith). 29 years old, happily married, adroit purveyor and voracious student of all kinds of information, theories, methods of inquiry, and forms of practice. Studying to be a priest in the Anglican Church in Canada. Main interests: military theory, diplomacy, foreign affairs, medieval history, religion & politics (esp. Islam and Christianity), and political grand bargains of all shapes and sizes.

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16 Responses

  1. Avatar Will says:

    I haven’t read Kelly’s book, but I think there are a few problems with wielding a crude political analogy (feudalism) that entails all sorts of nasty connotations. Whatever your views on capitalism or redistribution, I think we can all agree that workers aren’t serfs – they can leave their jobs and go elsewhere. Moreover, shareholders actually contribute something useful to the running of a corporation (capital and, at least theoretically, oversight), which is more than can be said of Medieval Europe’s landed gentry.

    We may have divergent views on corporations or corporate governance, but I don’t think you or similarly situated critics do yourselves any favors by resorting to hyperbolic terms like “serfdom” to describe an economic system is wildly different from feudalism.

    Incidentally, I think the strongest argument against your vision of distributism is the prudential case against dramatic economic changes/wealth transfers from my earlier post.Report

    • Avatar Chris Dierkes in reply to Will says:

      Yes mobile serfs if you like. I was surprised–actually shocked–at the numbers she provides in terms of how little stockholders actually add in terms of capitalization to major firms. Very very little.

      The use of the feudal/aristocratic analogy is that the individual has no real recourse (except to try to run a business on your own I guess, which is damn difficult) from within the system. That person doesn’t have a voice and their interests are considered. They aren’t even on the radar.

      In that context, it makes a great deal of sense to me.Report

      • Another objection to the notion of shareholders as aristocrats – in this day and age, just about anyone with a retirement or pension plan is a shareholder.Report

        • That was gonna be my comment. The average shareholder has effectively zero control over the corporations they “own.”Report

          • Avatar Chris Dierkes in reply to ChrisWWW says:

            true, people have stocks, but (I’ll have to look up the numbers again) but it’s an obscene amount owned by upper 1%. To speak mixaphorically, the estate is the casino. People have stocks sure, but the house wins when the odds that are stacked against. But the problem that Kelly focuses on is that stockholder interests (as determined by the increasingly erratic gambling-like stock market) drive essentially everything in a corporation. Which includes massive cost cutting. So even if you are say an employee of Corporation X and you get some stock in lieu of a raise, what’s the likelihood the stock is going to net you more income than a raise would?Report

            • Fair enough, but these wind up being differences in degree rather than kind, whereas a feudal system really tends to emphasize differences in kind rather than degree.

              Also – when we’re talking about various retirement funds, we’re not usually talking about shares in an employee’s own company offered in lieu of a raise. We’re talking instead about things like 401(k) and pension plans that, particularly nowadays, tend to be somewhat diversified and are not usually offered in lieu of raises but instead are fairly steady forms of compensation that are actively dependent on the employee’s base salary (i.e., no raise, no bump up in 401(k) contributions; get a raise, get a bump up in 401(k) contributions).

              Finally, this also seems to ignore the power that the mutual funds and pension plans have over corporations.

              I’m not saying anything about the desirability of this system, just trying to point out why I’m having trouble with the specific analogy to feudalism.Report

  2. Avatar Katherine says:

    Fascinating. A lot of your lines get to the heart of what I’ve been trying to say about the economic system:

    [Stockholders] are the ones considered to be adding value (while the actually productivity of workers increases though their wages stagnate for higher stockholder share prices)

    Rand as Chait judiciously shows, attempted to make a moral argument on behalf of the aristocrats. That they were somehow oppressed by the majority. When in fact, they, just like aristocrats of old, gain the majority of their wealth from rent collection.

    But corporations are now above states. We live in market states not nation-states

    As an argument against increasing government programs as a means of increasing socioeconomic equality, it’s an interesting one. Even if the social safety net is expanded, the corporations will still control the state. Her ideas seem likely to come close to what I see as the ideal (as opposed to what’s actually practical): breaking the power of the modern aristocracy rather than just ensuring the producers get some of their money back.

    And of course, everything she says goes triple for the “developing” world, where the corporations are effectively the government and dictate what policy will be regardless of who’s elected.Report

  3. I have to admit I don’t really find the “market state” hypothesis any more compelling now than when I first started reading Gilpen and Strange back in my undergraduate IPE days. The degree to which corporations actually direct state behavior is at best questionable. While they disproportionately hold sway in the US, there’s nothing to suggest they have any comparable amount of power in the next generation of great powers, for example. Within BRIC nations, as an example corporations are clearly subservient to the state, and of these the most powerful (China) has a significant interest in promoting technonationalist agendas which place state and national prestige over that of the interests of any corporate interests. Corporations as we’ve found are falling all over themselves trying to accomodate China, a model which is more replicable than people give it credit for.

    Also, I find her “stockholders as aristocracy in feudalism” thesis fundamentally problematic. Simply dividing things into a distinction between those who rent and those who collect rent vastly oversimplifies the social and economic conditions that distinguish between early chattel slavery (Hellenic economies circa. 4th century B.C. – 8th century AD) feudalism, mercantilism, industrialization and so on. In fact the most distinct and problematic concept of shareholders as aristocrats is simply the fact that the vast majority of funds in operation today aren’t held by a handful of people, but are more the collectivization of individual savings. That is the greatest shareholders in many equities and capital markets are either sovereign wealth funds, retirement plans (mutual funds) or some other form of collectivized mass of money. That we employ a small handful of people to manage it for us doesn’t make them any more aristocrats (even if they get paid a lot) than say chatelanes were actually the ones with aristocratic power over the old gentry. In terms of ownership they’re just stewards looking after our money.

    I would argue that Rostow’s stages of economic development better encapsulates the difference between the idealized “liberal” economy where somehow innovators and producers get all the credit and what we see in modern times. Specifically when an economy reaches “maturity” and the interests of the people writ large move towards post-economic interests, whether they be external (imperialism/interventionism) or scientific, or generally just beyond industrial/economic development. The handful of people who remain interested in such things are going to naturally be more involved while the rest try to look for how to move forward.Report

  4. Avatar Chris Dierkes says:

    Regarding the BRICs I still think you are looking at them as if they have a formed political ideology. Russia has some kind of piss the US/West off, get back our backyard thing. China has its Middle Kingdom-ness sorta. But it’s not that corporations run the world, but that there is no political fight left to fight. Post-politics is post-economics, leaving us in a market (not corporation) state. Or market governance/response system.

    Now it’s by no means “free” markets in that sense, but markets that drive the founding of political legitimacy. Legitimacy, such as there is any left politically in the world, derives almost entirely from expansion of opportunity (or its inverse in the current recession, protection from total collapse). There I think Rostow’s point about people focusing on post-material values makes some valid points, but needs to be (I think) more contextualized to the post-Cold War world (and not just a generic stage model).Report

    • I’m not saying so much that the BRICs have a formal political ideology, but their development vis-a-vis the traditional western economies is somewhat different than what we’re used to seeing. They seem much less likely to accept corporate or even market oriented strengths and are more interested in keeping control of their economic destinies.

      That said, there’s a point that the ability to manage the economy is now the prerequisite towards judging the effectiveness of state institutions, most of the instances we find of breakdown of such institutions don’t appear to be predicated by failures of state management of economics.Report

      • Avatar Chris Dierkes in reply to Nob Akimoto says:

        Nob,

        I recommend Ha Joon Chang’s Bad Samaritans. He argues that the BRIC countries are essentially just following the industrialization path of the US, France, Germany, and the UK during the 18/19th centuries. The argument is the Washington Consensus of the 90s was the exact opposite of what should be done to develop a country internally.

        Which I think is true. Still the negative sides of this are enormous and shouldn’t be underestimated. Interestingly then, say in the US post Civil War we called the people who ran things “robber barons” (more feudal terminology). Their path is very much in the line of Hamilton, Clay and others. All the kinds of things we hear about today re: China, things like patent stealing/knock offs, no labor laws, child labor, cruel prisons, mass corruption/violence, ecological destruction. It’s all pretty much straight out of Charles Dickens.Report

  5. Avatar North says:

    I’d be very interested to hear your opinion on the second half of the book. I find that the proposed alternatives/solutions often are far more revealing of the author’s point of view than their analysis of the problem.Report

  6. Avatar ChrisWWW says:

    A couple things I don’t understand:
    1) “There’s nothing safety-net wise to invest monies collected from redistribution into. Where would anyone who is receiving redistributed funds put it if they want to climb the social ladder? Housing? Stocks? Some of that ‘internet money?'”
    The goal of redistribution is not investment. Right? The point is to provide a minimum standard of services to the less economically fortunate.

    2) If we’re treating corporations and their stockholders and aristocracy, why doesn’t the government with its voters and taxpayers fall under the same classification?Report

    • Avatar Chris Dierkes in reply to ChrisWWW says:

      To #2, Kelly would argue that we have the vote and can change our political office. We also have civil rights constitutionally guaranteed. The latter being more important than the former. As I said in the post I think she overemphasizes the value of the ballot box, but that’s just my own view of things.

      Her argument is that there is no real equivalent in the economic sphere. I mean there’s thing like you can’t be fired/not hired because of your racial background (but that’s mostly an application of political rights into the economic sphere).

      If you don’t have mass stock, you don’t get a vote basically. There are alternative ways of organizing a corporation–which I think would be the real way forward. But I just don’t ever see that happening for a whole host of reasons.

      To #1. This is obviously a much bigger conversation, but I think you are right that redistribution (econ.) is meant to cover a basic minimum. Of course you might think the simpler way to do it is just give people money and cut out all the subsidies, targeted programs, etc. That’s another conversation for another day. But I guess my point is that is that mindset (redistribution alone) is basically surrender to the inevitability of mass poverty. This is why I always say the US doesn’t really possess an actual left.Report

      • Chris,
        Thanks for responding. I think I understand what you’re getting regarding point #2, but I’m not sure how redistribution is a surrender to mass poverty or what you mean by redistribution alone.

        Sure there will be people that can’t ever dig themselves out of poverty and off the government dole, but I’ve always had the optimistic view that most people find the idea demeaning and would rather get a job and buy nicer cars, a better apartment and a bigger TV. The safety net funded through redistribution makes sure people don’t starve and die on the streets due to bad circumstances like a global recession.

        Anyways, sorry if I’m being dense. I probably need to just read this book myself.Report

        • Avatar Chris Dierkes in reply to ChrisWWW says:

          no i don’t think your being dense.

          What I think could be done is form a safety net for the current economic age we live in that could also help bridge sclerotic class divisions. Ted Halstead and Michael Lind in their book Radical Center have some interesting ideas in that regard. The safety net could then I guess you say have some “spring” in it.Report

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