Capitalism and the Peace Testimony

August 8, 2014 § Leave a comment

Capitalism is predicated on competition: competition between businesses for markets, resources, capital, research breakthroughs, and labor; between labor and management for the terms of contract agreements; between workers for jobs; between industries for government support; between corporate nation states and other economic macro-systems for all of these things.

Competition assumes shortages or limits—there is no need for competition if there is already enough of what everyone wants. Competition within the context of limits, real or assumed or artificially imagined or created, often leads to conflict, and conflict sometimes leads to violence. Capitalism is inherently, if not necessarily in any given instance, violent.

A classic historic example is the violence against unions in the early days of labor organization, a violence that has never really ceased, except that businesses no longer hire paramilitary organizations like the Pinkertons to murder and assault workers. And God help you if you’re a teacher, or work for any level of government.

Does competition have to lead to violence? Enlightened business owners, labor leaders, and political leaders can rely on cooperation and mutual understanding to resolve competing claims, and we do have a fairly robust infrastructure of negotiation and arbitration, from the United Nations to the National Labor Relations Board. Cooperation is most possible when the system is working well and no parties are near the particular edge or shortage that they fear. But the system does have these edges—these divisive thresholds—that necessarily separate the participants when we reach them, when oil becomes really expensive or when job shortages make dependence on military spending attractive. And the disparity between those at the top and those at the bottom—between economic classes at home or between the overdeveloped and the developing countries of the world, for instance—these disparities create a distance of experience and worldview that undermines understanding even when intentions are good, making conflict and violence more likely.

For a truly eye-opening and compelling look at how the unbridled global expansion of capitalism—what we call globalization—often collaborates with superficial democratization to unleash ethnic violence, I highly recommend Amy Chua’s World on Fire: How Exporting Free Market Democracy Breeds Ethnic Hatred and Global Instability. She describes how, when elections finally give power to an ethnic majority that has historically been dominated economically by an ethnic minority, that majority tends to turn on their minority oppressors. That is part of what is happening in Iraq right now, with a majority Shiite-dominated government paying back the Sunni minority for decades of oppression and disenfranchisement, except that in Iraq the religious identities are even more important than the ethnic ones.

This dynamic has played out in country after country, in the Balkans, in Indonesia, the Philippines, in Rwanda, and southeast in Asia, just to name a few. We have even seen it in the United States sometimes, as in the occasional tensions between Asian small store owners operating in mostly African American neighborhoods.

It’s true that business competition is extremely creative. It drives innovation. But even this dynamic is destructive. “Creative destruction” is the term of art for the fate of established businesses that can no long compete against upstart innovators—Kodak, for example, or the manufacturers of floppy disks, or the publishers of printed, multi-volume encyclopedias. This creative destruction almost always hurts workers; they lose their jobs to the technological advance. And it almost always disadvantages the lower-wage workers most, because they are the most easily replaced by technology. In this way, and in many others, the system tends to increase inequality, especially in mature economies that have more or less finished the process of industrialization.

We value—and measure—this destruction of jobs. We call this measure “productivity”. Productivity tracks how much work a worker can do in a given period of time. Increased productivity means that human energy has been replaced by technology. Economists and politicians love high productivity numbers, gleefully glossing over the fact that it means fewer human jobs, fewer humans needed to do the same work.

R. Buckminster Fuller defined another measure that economists seem to have ignored—the energy slave—which measures goods, services, and processes in terms of how many years of human labor have been replaced by technology. The energy slave is the only economic measure that, if only indirectly, acknowledges capitalism’s debt to the Atlantic slave trade. In places that can’t come up with enough energy slaves, they tend to come up with human ones.

Most importantly, perhaps, the moral system that is capitalism has no inherent interest in the fate of those who suffer at its hands, those whom it grinds down or even out of the system. The system has never done even the obvious, basic thing of providing for those who lose their jobs to layoffs or technological advance. That it leaves to government; that is, to you and me.

More importantly, it actually takes unemployment as a given and accepts 3–5% of the workforce trying to live without an income as a “good” number. This reflects the fact that the capitalist system needs at least a modicum of unemployment, of competition between workers for jobs, as a means of keeping wages and benefits down. And the system leaves it up to external actors to care for these victims, making the government and even the workers themselves pay for the human cost of this inherent competition. And we all accept this as normal, as a given, even as appropriate. We are all praying for an unemployment rate below five percent, as if that would be a great thing.

Furthermore, the competitive genes in capitalism’s DNA have always driven it to expand its influence beyond its own spheres of activity in the market, to seek to distort the behavior of external actors in its interest. Capitalism corrupts the political class, especially, and the entire social fabric, as well, with the ideology of the market as god, as the preeminent, most pervasive, and most valuable social system we have, as the “creator of wealth” and the pathway to, and even guarantor of, democracy (ironically, given its own quasi-feudal structure), and as the set of values and needs that should trump all others in social policy. That is the message of, and the reasoning behind, the US Supreme Court’s Citizens United decision: the legal “personhood” of a corporation is even more valuable and important than democracy itself, certainly more valuable than real human persons.

And, of course, capitalism corrupts other systems, especially the political system, directly sometimes, through outright graft. Companies seek advantage, and inevitably, some politicians are willing to give it to them. For some people in high places, being a slave to capital, being ideologically captive to the system, is not enough. They want to remodel their house or go on an expensive vacation, too.

Back to the creative effect of capitalist competition, because this is a credible and compelling argument for it. We humans are going to compete, especially when faced with shortages. Furthermore, this competition has historically driven incredible advances in human well-being over the last three centuries or so. That’s the trade-off for the destruction and subjugation of indigenous and traditional societies, the rape of the earth, the infection of all other social systems with market values. And yes, the social-economic systems of the past have also been unequal and oppressive, though none has been as rapacious. And meanwhile, we see no clear alternative. We have to work with what we’ve got.

Nevertheless, I believe that capitalism historically and inevitably, if not necessarily, has and does lead to violence. That Spirit that leads us to avoid all occasions of war calls us to bring peace to our economic system, as well as to all other theaters of conflict.

I might pose the queries for Friends regarding competition thus: Is the trade-off between innovation and technological advance and the violence the system does to everyone, but especially to workers, worth it? How can we promote cooperation in a system that is adversarial to the core? How do we protect the weak and disadvantaged when shortages heighten the competition to the point of violence, whether physical or “just” economic, especially since we are approaching severe shortages of some basics around the globe—food and water, particularly, and many other resources regionally? How can we make economic “households”, especially corporations, inherently careful of the needs of all the stakeholders in the system—workers, consumers, and non-workers—and not just careful for owners and stockholders, while retaining the innovative energy that competition provides rather than chasing after them with regulators and economic ambulances after the fact of their violence?

How can we speak to that of God in the men and women who run our economic households? To that of God in those who find themselves the victims or the adversaries of these people and the systems they manage? To that of God in those who set social and economic policy? How do we speak to that of God in the legal “person” that is a corporation, if there is such a thing? What if there isn’t such a thing? How do we bring the gospel of peace to our economic institutions?

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