The Future of the United States of America
BY TRANSCEND MEMBERS, 2 Jan 2017
31 Dec 2016 – What I most want to say is that social chaos and ecological disaster cannot be avoided without transforming basic cultural and social structures. Otherwise no economic policy will work. For structural reasons, all economic policies lead to unacceptable results. The reason why this is the case is that the basic social structure has unacceptable consequences, while the economy lives, and moves and has its being inside it. Operating inside the basic structure, the economy cannot, with any model or with any policy, reliably meet the needs of all the people in a sustainable harmony with nature.
Let me now relate these abstract concepts (whose meanings I will explain below) to today’s politics. I believe the popularity of Donald Trump and Paul Ryan and their fellow believers in America First and in 18th century French natural rights philosophy and 20th century Austrian economics will soon suffer a precipitous decline. Although I personally agree with Trump on rapprochement with Russia and on anti-globalism, and I agree with Ryan that something must be done about the fiscal crisis of the state, I expect Trumpism to tank and Ryanism to recede regardless of whatever you or I may agree with or disagree with.
I regard these hypotheses as probably true: Progressives will succeed in loosening the establishment’s grip on the Democratic Party. 2017 will bring disillusionment and misery. 2018 will bring a Democratic congress. Then, and starting now, the time will be ripe to transform basic cultural and social structures.
The American people already know from recent experience with Jimmy Carter, Bill Clinton, and Barack Obama that the Democrats do not have good answers either. I will argue that not even the best and the brightest Democrats, and specifically not even Robert Reich[i] and Joseph Stiglitz[ii], have proposed solutions that will work without structural change. I do not mean that Reich and Stiglitz and Bernie Sanders and Elizabeth Warren and other voices of sanity are wrong. I mean that the best progressive proposals will only work with and as part of structural change.
Since the phrase “social structure” is a contested concept[iii] that is used in many ways, I begin by explaining how I use it. My point of departure is Chapter Four titled, “What ever happened to social structure?” in Douglas Porpora’s new book Reconstructing Sociology.[iv] After reviewing the main current uses of the phrase, Porpora endorses a critical realist definition: Social structure is material relations among social positions and social constructs.
Here the main point is that the social world with all of its rules and roles is material. When the law –a social construction—punishes alike the rich and the poor for sleeping under bridges and for stealing bread, or decides who is legally entitled to eat (those with money) and who is not entitled to eat (those without money) in a famine[v], the bridges, the bread, and the human cells that die for lack of nourishment are material.
Although the social relations (like the relation of buyer to seller, or the relation of employer to employee), the social positions (like the position of owner), and the social constructs (like contracts) are constituted by cultural rules, the social structure thus constituted is material.[vi] It cashes out on the ground as some eating and others not, some sleeping under dirty blankets on sidewalks while others sleep between clean sheets in beds, some living and others dying. Agreeing with Jürgen Habermas that in our contemporary world the primary institution is the market, and that governments are secondary to it,[vii] I use the phrase “social structure” mainly to refer to the relations and positions established by the legal and moral rules that constitute markets. Those rules can be placed in these four categories that I call the four sides of “the box”:[viii]
- Property, who owns what
- Contracts, the rules of buying and selling
- The autonomous juridical subject capable of owning property and making contracts
- Prohibitions against intentionally harming other people. Without them there could be no markets because the strong would simply overpower others and take what they wanted. (But there is no affirmative duty to help people.)
Where there are such rules, there are markets; without them there are no markets. To the extent that such rules prevail, people are no longer in a traditional social structure where one’s livelihood depends on mutual duties among kinfolk and clan folk, but in a modern social structure. In a modern social structure, one’s livelihood depends on selling enough to get enough money be able to meet one’s needs by buying.
Suppose you know that the basic social structure is established by the constitutive rules[ix] that organize market exchange (i.e. the box just outlined). You know that people sell for money and buy with money.
If you already know these things about the basic social structure, then you already can deduce basic economics: In this kind of society (our kind) in order to live people have to produce a product,[x] or else sell their labor-power for wages to someone who produces a product, or else position themselves to capture some of the surplus left over after the products have been sold and all the costs of production have been paid.
I call this social structure “basic” because it governs meeting the basic necessities of life. Thus, for the Hopi people the basic cultural structure organizes the production and distribution of corn; for a pastoral people the basic cultural structure revolves around their herds. (I prefer the word “cultural” rather than “social” when speaking of non-modern societies, and I prefer it in some contexts even when speaking of modern societies.)
Once you know the basic rules of the game that organize livelihoods in a society you can deduce a great deal more about it. Concerning the United States and similar societies you can deduce two staggering never-to-be-forgotten facts: 1. Life depends on investor confidence. Meeting the basic needs of life depends on consumption, which depends on production, which depends (not entirely but mainly) on investment, which in turn depends on the expectation of profit, i.e. “confidence”. 2. Life depends on selling. Meeting the basic needs of life depends on buying, which depends on selling something to generate the money needed to do the buying.
These staggering facts are not empirical findings of economists. They are sociological facts or historical facts more than they are economic facts. Sociologically, they are consequences of the basic social structure.
As historical facts, they are outcomes of long processes.
As history has turned out, in the 16th, 17th, 18th and 19th centuries the European peoples conquered the other peoples of the world. They turned the entire planet into one big market –in the process marginalizing innumerable indigenous basic cultural/social structures.[xi] In Immanuel Wallerstein’s terms the European world-system became the modern world-system.
Schematically, we can represent key tendencies of history as stages in the evolution of markets. In the first stage, peasants brought their geese and cabbages to market-fairs to buy a fat pig, and then went home again jiggety-jig to salt it and save it for sustenance during long cold winters (selling in order to buy); and then as a second stage merchants went to market to buy grains in order to sell them again in the winter when the price of grain would be higher, or else in order to move them elsewhere to where the price of grain would be higher (buying in order to sell); and then entrepreneurs bought labor-power and other inputs in order to produce merchandise to sell (buying in order to produce in order to sell). And then financial calculations estimated from the get-go the net return from investing in order to produce in order to sell for profit (buying to turn money into more money). Since money turned into more money can then be thrown afresh into new and larger investments, it can accumulate as compound interest accumulates (capital accumulation). Increasingly in recent times, finance capital dominates productive capital, and often prefers the global casino to the real economy.[xii] Money turns into more money without the intervening phase of producing goods and services[xiii] (capital accumulation divorced from the real economy).
Adam Smith was among the first to observe that the accumulation of capital made possible the navies and armies that in turn made possible the European conquest of the rest of the world.
I want to suggest that it was not an accident that history has turned out as it has, nor has its outcome been mainly the result of the intentional actions of individuals and groups. There is a tendency to exaggerate the power of people, for example the power of the 1%. But the main power, i.e. the main cause moving history, is social structure. Once market exchange gets started, it is virtually inevitable that human life will come to depend on investor confidence and on selling. At the point where capital accumulation becomes the objective, then something like Alfred Marshall’s law of substitution comes into play.[xiv] When a more effective and more efficient way to accumulate capital is found, it will tend to expand and grow and, correspondingly, older ways of profit-seeking will tend to shrink and decline.
The full significance of these causes that push history step by step from Simple Simon selling pies on the way to the fair to Lehman Brothers selling derivatives on the way to the crash, cannot be understood without considering two corollaries of the two Staggering Facts. The corollaries –like the Staggering Facts themselves—are consequences of the basic social structure. They are:
1A. There is a chronic insufficiency of inducement to invest.[xv] It is not only the case that the bread and butter of the people, their employment and their dignity, depend on the confidence of investors. It is also the case that investor confidence perpetually flags, lags, and threatens to collapse. For example, in the USA today “inner city” denotes “a place where there is little or no inducement to invest.”
2A. There is a chronic insufficiency of effective demand. This is no small matter because profits depend on sales, while investment, and therefore output and employment, depend on expectations of profit.
Putting 1 and 2 together with 1A and 2A yields a double whammy. Life depends on investments and on sales. Both are fragile and tend to fail. For those who cannot think outside the box, whenever the machine stalls, as it did in 2008, the motive to do whatever it takes to crank up the stalled old machine and make it go again, could not be stronger. “Whatever it takes” includes bailouts, zero or near zero interest rates, quantitative easing, astronomical public and private debt and so on. In general, the chronic insufficiency of effective demand implies that cash sales are never enough; the world must run on credit and ever more credit. Ever higher mountains of unpayable debt are also consequences of the social structure.
Some see 1A (lagging investment) and 2A (lagging sales) as truths discovered by Thomas Malthus, and then operative in economic reality but swept under the rug by economic theory until they were rediscovered a century after Malthus by John Maynard Keynes; and then in the capitalist revolution that began on or about September 11, 1973, they were[xvi]once again swept under the theoretical rug by Chicago economics and similar bogus pseudo-sciences.[xvii] Like a repressed trauma simmering away in a Freudian unconscious, 1A and 2A (the weakness of the inducement to invest and the weakness of effective demand) continued throughout the eighties and the nineties to act at levels of reality invisible to mainstream economics. Then (some say) what politically dominant but scientifically bogus economics swept under the rug exploded into full view in 2008.[xviii]
The above is what “some say.” My view is slightly different. 1A and 2A are consequences of 1, 2, 3, and 4. Malthus and Keynes noticed the tip of the iceberg, not the whole iceberg, not the social structure. I hope these numbers are not too confusing. 1A means too few investors. 1B means too few buyers. Both are consequences of basic social structure, i.e. the box. The box is 1 2 3 4. 1 is property. 2 is contract. 3 is the individual autonomous juridical subject. 4 is the duty not to harm others with the conspicuous absence of a duty to help others.
The basic social structure also might be summarized in three words as “liberty without solidarity.” (Thinking, as Milton Friedman and similar thinkers often do,[xix] of 1 2 3 and 4 as four aspects of the one idea of liberty, also called freedom). In five words the basic social structure is “liberty without equality and fraternity.”
Once again, the corollary Staggering Facts are not so much economic facts as facts about the basic cultural and social structure. The basic rules of the game of life already provide as a matter of law, as a matter of morals, as a matter of custom, and as a matter of conventional common-sense, that although everybody is expected to earn a living by selling something, nobody has a duty to buy. Although people need jobs, there will almost always be more job-seekers than job-offers.
Reliably meeting human needs in harmony with the natural environment is not even the objective. It is not likely to be achieved.
From the moment when the game of life is constituted as the buy-and-sell-game, the double whammy begins to operate. The double whammy –i.e. everybody’s bread and butter physically depends on keeping investor confidence strong, while investor confidence is perpetually shaky because sales are perpetually shaky– has made it inevitable, or nearly so, that history would turn out as it has in fact turned out.[xx]
Insufficient appreciation of the force of the double whammy explains why Robert Reich, when interviewed on television shortly after the 2016 election, [xxi] could declare himself unable to comprehend why the president-elect had chosen as head of the Environmental Protection Agency someone who does not believe in global warming, as Secretary of Education someone who does not believe in public education, and as Secretary of Labor someone who does not approve of the labor laws he is supposed to administer. Reich described their thinking as “neolithic.”
But the double whammy is not neolithic. Capital accumulation is the motor that drives the economy now in the 21st century. It is a perpetually defective motor. It tends to stall. It is not simply a matter of the greed of the capitalists outweighing the needs of the people because the capitalists buy the politicians. No. It is worse than that. It is a matter, ceteris paribus, of the poor not eating, and the government not having any streams of income to tax, unless the rich have confidence that their investments will be profitable. More often than not (here comes the double part of the whammy), there are reasons to fear that if investment (“growth”) does not improve quickly, the tendency to low confidence coming from the chronic insufficiency of effective demand will breed even lower confidence in a negative feedback loop spiraling downward into depression. Therefore, when profits can be made by mining dirty coal, or by making schools even more closed to critical thinking than they already are, or by breaking unions, there are unrelenting temptations to sin. All this is built into the social structure, and will not change until the structure changes. Reich was amazed when he should have been unsurprised.
For Joseph Stiglitz, a central message of his latest book is that “..the level of inequality of America is not inevitable; it is not the result of inexorable laws of economics. It is a matter of policies and politics.”[xxii] Robert Reich could have written identical words. Reich chronicles an endless parade of foolish policies that according to him (and to Stiglitz) could be reversed by intelligent legislators elected by intelligent voters. One example Reich gives is colloquially called the Mickey Mouse Act of 2003.[xxiii] Mickey Mouse was created in 1928. The U.S. Constitution provided for giving artists exclusive rights to their creations for a “limited time,” originally set by Congress at 14 years. Now corporate owners of intellectual property have exclusive rights for 75 years. After the Mickey Mouse Act the Disney Corporation can exact payment from anyone who uses Mickey’s name or image until 2023, for a total of 95 years. Even that deadline is expected to be extended. The parade goes on. Reich’s book is packed with examples of foolish laws that sacrifice the public welfare, the environment, social justice and whatever else to one sine que non: profit.
I have said perhaps enough about why in the United States (and by implication also in other countries) social chaos and ecological disaster cannot be avoided without the transformation of basic cultural and social structures. I have explained that the physical welfare and the sense of self-worth of the people depend too much on an unreliable economic motor with built-in tendencies toward social chaos and ecological disaster. This excessive dependency is a consequence of a basic social structure that has evolved to become today’s global capitalism starting from foundations laid long ago in Roman antiquity and in early modern Europe. Now I need to say something about why social chaos and ecological disaster can be avoided with the transformation of basic cultural and social structures. When guided by thinking outside the box, humanity can reorganize itself to remove itself from the endangered species list.
Today there are many proposals for “structural” changes of one kind or another. My structural proposal is to reduce human dependence on the capitalist sector (defined as the part of the private sector that invests accumulated capital for the purpose of accumulating more capital) by strengthening desirable non-capitalist sectors. It is to cut capitalism down to size by making it a smaller part of the total economy, to make it governable while still enjoying its benefits. (The qualification “desirable” excludes, for example, the criminal sector.) Among the structural change proposals already on the table mine comes closest to Latin American and European economia solidaria, which has roots in the social teachings of the Roman Catholic church; and to the proposals of Amartya Sen, Martha Nussbaum and Jean Dreze. It is not intended as a condemnation of traditional democratic socialism or social democracy but as a way to revive them by making them feasible. Its name is “unbounded organization.”
Capital accumulation, and therefore (by definition, or rather by one definition[xxiv], capitalism) is not in itself a bad thing. It is quite necessary, although it is not necessary that it be concentrated in a few private hands. Without it there is no surplus to redistribute. There is no possibility of financing big projects, including the biggest project of all: retooling humanity with green technologies that do more with less. Way back in 1873, Walter Bagehot, in a book explaining how the high finance of the City of London worked, wrote that from that time forward no worthy project, be it a port or a railway or some other, anywhere in the world, need fail for lack of capital.[xxv] The banking system was capable of pooling savings and creating credit to raise any required sum. What Bagehot had in mind was a project able to repay a loan at a rate of interest profitable for a bank; but worthy unprofitable projects also require capital accumulation. If Andrew Carnegie had not accumulated capital, there would be no Carnegie libraries and no Carnegie Endowment for International Peace.[xxvi]
The problem is not that capital accumulation happens. The problem is that it tends to control everything else, at the same time that it is unreliable. Its normal tendency is to maximize profits by minimizing costs, and that means minimizing wages, minimizing employment, and minimizing taxes. Capitalist firms can provide quality employment, pay good wages and contribute their fair share of taxes. Some do. Creating a society where the only capitalist firms that exist are like today’s best firms requires social and cultural transformation.
The kind of transformation of the basic social and cultural structure that is required is a transformation that would make society governable. If and when the required transformation is achieved, fear of capital flight, layoffs, plant closings, disinvestment and so on; will no longer deter people from cooperating intelligently to do what needs to be done to achieve the social integration of released offenders, meaningful livelihoods for everybody with nobody left sleeping on the sidewalk, levels of carbon dioxide in the earth’s atmosphere below 350 ppm, and so on. Such a transformation will build an economy that keeps running even when the big investors do not invest. Without the transformation (i.e. now) they put the brakes on the economy whenever they no longer have confidence that investment will be profitable. Or (as happened in Chile in 1973 and is happening in Venezuela now) they may torpedo the economy deliberately to create an economic crisis for the purpose of bringing down the government.[xxvii]
Amartya Sen writes of the “… mean streets and stunted lives that capitalism can generate, unless it is restrained and supplemented by other– often nonmarket– institutions.”[xxviii] It is necessary to emphasize Sen’s word “supplemented.” Restraint is not enough. When capital is restrained, for example, by requiring a minimum wage or by forbidding the release of PPCPs into groundwater, capital still has the options of shutting up shop or moving elsewhere. It can still exercise what Samuel Bowles and Herbert Gintis call “the exit power of capital.”[xxix] The transformation of the social structure that is required is one that neutralizes exit power by making sure other ways to meet human needs can swing into action and fill the breach when one or more of the standard ways fail. That is why “supplemented” should be emphasized along with “restrained.”
The long list of alternative ways to meet human needs, like the somewhat shorter but still long list of ways to meet human needs in harmony with nature, has no end. It is a motley list. Some items on it are more independent of capital accumulation than others. It is a list that grows as social innovations come on line. It includes volunteer fire departments and families that function as an economic unit and run motels together, backyard gardens and urban rooftop gardens and community supported agriculture, permaculture, dentists in private practice, longshoremen who load and unload ships as a worker-owned cooperative, mutual insurance companies owned by the insured, municipally owned electric power companies, the State Bank of North Dakota, symphony orchestras funded by music lovers, feminist collectives who share housing and cooking and child care, as well as autonomous public entities like the Port Authority of New York, and as well as churches that derive an income from owning apartment buildings and use the money to serve the poor, and indigenous peoples who still live in tribal communities and still practice their traditional ways of doing things, … The list has no end. Think unbounded organization.
I mention specially two kinds of non-capitalism that at first glance might be left off the list because they might seem to be capitalism. One is the mile upon mile of little businesses you see driving through a big city. It should not be assumed that just because they are businesses they are accumulating capital; many of their owners earn less than they would earn working for wages. A second non-obvious non-capitalism is found in the behavior of capitalists themselves when they choose not to pursue single-mindedly the goal of enjoying on their deathbeds the satisfaction of having piled up the maximum amount of money they could possibly have piled up. There is no unbreakable psychological law that compels capitalists to act like capitalists. If Bill and Melinda Gates decide to spend a billion dollars to cure the children of Asia of diseases, instead of investing it at compound interest until it turns into two billion dollars, who is to stop them? If Mark Zuckerberg and his partner Priscilla Chan decide to spend their money while they are alive contributing to building a better world, and not to found a dynasty by leaving fortunes to their children, who is to stop them?
Let us agree with Bernie Sanders that the young people who voted for him represent the future of the Democratic Party and the future of the United States of America. Let us further agree with him that to compete successfully with the Republican Party at all levels, and to renew itself with progressive ideas and progressive leadership, the Democratic Party must become a participatory grassroots organization with numerous active members in every nook and cranny of the nation. It would then remain to ask what the numerous young progressive activists who are breathing new life into the Democratic Party will talk about when they meet from Bangor to San Diego in church basements, in union halls, and in the cafeterias of community colleges. What will they do?
I have a specific suggestion, or, rather, a specific idea about a general area to consider working in. The grassroots Democrats should consider working to improve their local neighborhoods and communities. Make them more self-reliant, more neighborly, more like real communities and not merely locations where separate individuals happen to be spending the same time in the same space. You can read about community-building at www.abundantcommunity.com. That website gives many examples of good things already happening in town after town, city after city. It is as if people all over this land have already sensed by intuition that community is the way to go.
The community approach has several advantages. It gives people a reason to come to the meetings. The meetings are not just about whom to campaign for in the next election. They are about being sure Tillie, the elderly woman who lives alone in the house on the corner, will have someone to drive her to the hospital if she has another attack. The meetings are about people becoming more secure and happier here and now. Another advantage is that community is a good talking point when running for the School Board against the local Tea Party candidate. “Community” is a word that puts “freedom” in perspective as one value among others; it is a word that suggests defining freedom as Martin Luther King Jr. defined it (as a call to moral responsibility)[xxx] and as Martha Nussbaum[xxxi] and Amartya Sen define it (as capability to do things).
Seen in historical perspective, community-building is a way (not the only way) to transform the basic cultural and social structures. Building community is part and parcel of people becoming less isolated and therefore less defenseless; and therefore, it is part and parcel of building a social structure that will reliably meet human needs even when the confidence of investors plummets.[xxxii]
Let me say a little more about how the social structure that now both blesses and oppresses humanity was built.[xxxiii] Already in the second century after Christ the Romans needed a Great Simplification. Like the British in the nineteenth century, the Romans in the second century found that they could not trade or govern in a vast diverse empire without imposing some simplicity on it. Roman Law, and especially the jus gentium that applied alike to Roman citizens and to non-citizens, was a Great Simplification, and by the same token it was an eclipse of community. The empire was an overwhelming military force interested in collecting tribute and in protecting merchants, but not interested in how its component ethnic groups gave meaning to their lives and exchanged matter and energy with the physical environment. The law abstracted from the empire’s multicultural diversity with its wealth of languages, spiritual and material practices, moral codes, kinship and marriage obligations, patterns of mutual obligations, ceremonies, rituals, and stories.[xxxiv] Simplifying for the sake of commerce and for the sake of public administration, it classified certain rules as “natural.” The word “natural” meant “the same everywhere.” In practice, “everywhere” meant “wherever Rome rules.”
Fast forwarding past the Middle Ages, a millennium and a half later, in the sixteenth to eighteenth centuries, the successor states of the Roman Empire were constructing the cultural and social structures of modernity. For their Great Simplification, they “received” the ideal of rule of law that antiquity had bequeathed them, but only to encounter another obstacle to modernization. Living in a Europe (formerly known as “Christendom”) dotted with great cathedrals, the modernizers had to achieve a certain distance from God. God had then and still has today the inconvenient trait of telling people what to do. (“Islam” means “submission” or “submission of desires to the will of God.”) It was impossible to build a social and cultural structure around market exchange while God was constantly butting in commanding people to feed the hungry, give drink to the thirsty, clothe the naked, bury the dead, shelter the traveler, comfort the sick, and ransom the captive.[xxxv] Enlightenment minds like Jean-Jacques Rousseau rose to the occasion by substituting “Nature” for “God.”[xxxvi] What Nature commanded was first and foremost what Roman Law said was natural, which was in turn first and foremost the constitutive rules of markets. Although the idea that Nature had decreed laissez faire economics framed by a social contract guaranteeing pre-existing natural rights, encountered much opposition in France and in England with their long and complex intellectual traditions, it encountered little opposition in the new United States of America. As has been outlined above, once such ideas and their corresponding institutions are in place it becomes inevitable, or nearly so, that the physical welfare of the people will come to depend on an always precarious confidence of investors. It was not the 1% who created the double whammy to serve their own interests, and it was not created during Ronald Reagan’s presidency in the 1980s. The double whammy was created by history; its roots go back at least to an eclipse of community in the second century; and it does not serve anybody’s interests.
As of 2017, I think I perceive shining through the storm clouds a growing minority doing a culture shift toward a fundamentally different basic structure: toward sharing more with others and toward falling in love with Mother Earth. Score one for hope. Call it a growth point. But what about the fiscal crisis of the state? And the global race to the bottom? And the warfare state? Are these consequences of the basic social structure not cementing the system into place while we granola types are enjoying life in the counter culture? I refrain from suggesting answers to these questions here because this note is already too long. I am aware that to some it might seem too short, to promise more than it delivers, or even to stop where it should begin. I have offered answers to the questions just posed in other writings that are included below in a list of suggested further readings. Goodbye for now.
Howard Richards, “The Impossibility of Politics,” 2016, available on Google. This essay includes a series of “trimtabs” for transforming the basic social and cultural structures of the modern world, including coping with the global race to the bottom and the fiscal crisis of the state.
Joseph Stiglitz et al, “Rewriting the Rules of the American Economy.” New York: Roosevelt Institute, 2015, available on Google. In this and other writings Stiglitz makes important distinctions between profits with social functions and rents, paving the way for alleviating the fiscal crisis of the state through the effective capture of rents.
Riane Eisler, The Real Wealth of Nations. San Francisco: Berrett-Kohler, 2007. Eisler proposes partnership as a basic structural principle and caring as a basic value.
Evelin Lindner, A Dignity Economy. Lake Oswego OR: Dignity Press, 2013. The author is a leading researcher on the psychology of dignity and humiliation who brings findings from contemporary psychology to bear on social transformation.
Michael Porter and Mark Kramer, “Creating Shared Value,” Harvard Business Review. 2011. Pp. 499-513. The authors argue that profit per se can no longer be considered the goal of business.
Howard Richards and Joanna Swanger, The Dilemmas of Social Democracies. Lanham MD: Rowman and Littlefield, 2006. This book introduces the concept of “cultural resources” defined as existing capacities to cooperate to meet needs in harmony with nature.
Gavin Andersson and Howard Richards, Unbounded Organizing in Community. Lake Oswego, OR: Dignity Press, 2015. A step by step guide to community building drawing on experience in South Africa, Botswana, and California.
Howard Richards, Understanding the Global Economy. Santa Barbara CA: Peace Education Books, 2004, available as a Google Book. This book shows how causal explanation in economics draws on the basic cultural structure for its premises. There is an appendix on peacebuilding that considers aspects of the warfare state.
Howard Richards, Letters from Quebec. San Francisco and London: International Scholars Press, 1995. Chapters 26 through 50 are subtitled “Methods for Transforming the Basic Structures of the Modern World.”
[i] Robert Reich, Saving Capitalism: For the Many, not the Few. New York: Knopf, 2015.
[ii] Joseph Stiglitz, The Great Divide: Unequal Societies and What We Can Do About Them. New York: Norton, 2015.
[iii] W. B. Gallie, “Essentially Contested Concepts,” Proceedings of the Aristotelian Society. New Series, Vol. 56 (1955 – 1956), pp. 167-198.
[iv] Douglas Porpora, Reconstructing Sociology: The Critical Realist Approach. Cambridge: Cambridge University Press, 2016.
[v] Amartya Sen, Poverty and Famines: An Essay on Entitlement and Deprivation. Oxford: Clarendon Press, 1981.
[vi] Douglas Porpora, “Cultural Rules and Material Relations,” Journal for the Theory of Social Behaviour. Volume 37 (1993) pp 463-477.
[vii] Jürgen Habermas, The Legitimation Crisis. Boston: Beacon Press, 1975.
[viii] These four categories roughly track the Latin legal maxims suum cuique tribuere, pacta sunt servanda, honeste vivere, and alterum non laedere; and the four volumes of William Blackstone’s Commentaries on the Laws of England. Blackstone’s Commentaries was the legal text read by the founding fathers who wrote the United States Constitution.
[ix] Constitutive rules create social reality, as distinct from regulating a pre-existing social reality. For John Searle, all social reality is created by constitutive rules of the form x counts as y in context c. Constitutive rules give brute facts the social status of institutional facts. For example, x, certain bits of paper and certain magnetic traces on the computers of banks, count as y, money, in the context of the modern United States and whoever trades with it. The social status of the brute facts depends on general acceptance, and only lasts as long as the general acceptance lasts. The Construction of Social Reality. New York: Simon and Schuster, 1995.
[x] In standard economics “production” by definition is production for sale. Thus, Adam Smith Wealth of Nations. Book Two, chapter three. Thus, John Maynard Keynes: “All production is for the sake of ultimately satisfying a consumer.” General Theory, p. 46.
[xi] Catherine Hoppers and Howard Richards, Rethinking Thinking. Pretoria: University of South Africa, 2012; Maria Mies, Patriarchy and Accumulation on a World Scale. London: Zed Books, 1986.
[xii] This sketch of historical tendencies generally follows the logical sequence of forms of value sketched by Marx in the first volume of Capital. Fernand Braudel’s careful studies find, however, that the birth of capitalism was more a matter of large-scale financial and commercial transactions of which ordinary people were not aware transforming everyday life, than a matter of everyday life gradually evolving into global capitalism.
[xiii] Michael Hudson, From Marx to Goldman-Sachs. michael-hudson.com/…/from-marx-to-goldman–sachs-the-fictions-of-fictitious-capital..
[xiv] Marshall’s original concept was that when a less expensive (and therefore more profitable) method is found, producers will substitute the less expensive method for the more expensive method. On his own account, Marshall refers constantly to this law. Principles of Economics. London: Macmillan, first edition 1890, last edition 1920.
[xv] Keynes op cit p. 381 and passim.
[xvi] Fredric Jameson has famously remarked that the sixties ended on September 11, 1973, with the US-engineered coup that overthrew President Salvador Allende and imposed a ruthless dictatorship hell bent on putting neoliberal economic theories into practice.
[xvii] For example, by Milton Friedman in his arguments that low taxes, downwardly flexible wages, and minimal government intervention in the economy, plus a monetary policy putting just enough money into circulation to serve the real economy but no more, would lead to economic stability and steady growth. A Program for Monetary Stability. New York: Fordham University Press, 1983. The story of how such bogus pseudo-science came to dominate the world is told by Richard Crockett in Thinking the Unthinkable. London: Fontana Press, 1995.
[xviii] Paul Krugman, The Return of Depression Economics. New York: Norton, 2009.
[xix] Milton Friedman, Capitalism and Freedom. Chicago: University of Chicago Press, 1962. In Chapter One individual freedom is identified as the principle to be applied in the rest of the book.
[xx] There was a time after World War II when it was widely believed that Swedish Model social democracy was destined to be the future of humanity. That social democracy not only failed but necessarily had to fail because of the basic cultural structure it collided with but was unable to transform is a thesis argued in Howard Richards and Joanna Swanger, The Dilemmas of Social Democracies. Lanham MD: Rowman and Littlefield, 2006.
[xxi] On CNN in December of 2016. I do not remember the date.
[xxii] Stiglitz, op. cit. Location 185 of the Kindle edition.
[xxiii] Reich, op. cit. Location 607 of the Kindle edition.
[xxiv] The word “capitalism” was coined by Karl Marx. By identifying capitalism with capital accumulation I am using one of at least three definitions of it that can be found in his works.
[xxv] Walter Bagehot, Lombard Street: A Description of the Money Market. London: Henry S. King, 1873. “We have entirely lost the idea that any undertaking likely to pay, and seen to be likely, can perish for want of money.” From Chapter One.
[xxvi] Andrew Carnegie, The Gospel of Wealth. New York: Century, 1900. Carnegie believed that the inheritance of large fortunes should be heavily taxed. See also Robert K. Greenleaf, Servant Leadership. New York: Paulist Press, 2002.
[xxvii] Similarly, Jose Luis Coraggio has proposed building the people’s economic self-sufficiency by building popular economic institutions in response to the neoliberal program of the current president of Argentina, Mauricio Macri.
[xxviii] Amartya Sen, “Sraffa, Wittgenstein, and Gramsci,” Journal of Economic Literature, Vol. 41 (2003), pp. 1240-1255, p. 1247.
[xxix] Samuel Bowles and Herbert Gintis, Democracy and Capitalism. New York: Basic Books, 1986.
[xxx] Martin Luther King Jr., Strength to Love. New York: Harper and Row, 1963; Where Do We Go from Here: Chaos or Community? New York: Harper and Row, 1967.
[xxxi] Martha Nussbaum, Creating Capabilities. Cambridge MA: Belknap Press, 2011.
[xxxii] José Luis Coraggio has suggested that the solidarity of neighbors helping neighbors and of workers associating to work cooperatively when the Argentine economy collapsed in 2001 can be the germ of a strategy for transforming the economy even when it is not collapsed. De la Emergencia a la Estrategia. Buenos Aires: Espacio Editores, 2004.
[xxxiii] That weakening community was part and parcel of the rise of modernity is a standard thesis of the classics of sociology that is most explicit in Ferdinand Tönnies, Community and Civil Society. Cambridge: Cambridge University Press, 2001 (1887). It is also developed one way or another by Emile Durkheim, Max Weber, Karl Marx, and Georg Simmel.
[xxxiv] Roman Law is discussed in greater detail in Catherine Hoppers and Howard Richards, Rethinking Thinking. Pretoria: University of South Africa, 2012. Chapter Four.
[xxxv] These are the traditional Seven Works of Mercy. They roughly follow Matthew 25: 31-46.
[xxxvi] A comparison of two great books on education, the Spiritual Exercises of Saint Ignatius and Emile by Rousseau will show that wherever Ignatius wrote “God” Rousseau wrote “Nature.”
Prof. Howard Richards is a member of the TRANSCEND Network for Peace, Development and Environment. He was born in Pasadena, California but since 1966 has lived in Chile when not teaching in other places. Professor of Peace and Global Studies Emeritus, Earlham College, a school in Richmond Indiana affiliated with the Society of Friends (Quakers) known for its peace and social justice commitments. Stanford Law School, MA and PhD in Philosophy from UC Santa Barbara, Advanced Certificate in Education-Oxford, PhD in Educational Planning from University of Toronto. Books: Dilemmas of Social Democracies with Joanna Swanger, Gandhi and the Future of Economics with Joanna Swanger, The Nurturing of Time Future, Understanding the Global Economy (available as e-books), The Evaluation of Cultural Action (not an e book). Hacia otras Economias with Raul Gonzalez, free download available at www.repensar.cl. Solidaridad, Participacion, Transparencia: conversaciones sobre el socialismo en Rosario, Argentina. Available free on the blogspot lahoradelaetica.
This article originally appeared on Transcend Media Service (TMS) on 2 Jan 2017.
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