Political Economy

Curious Utopias

May 13th, 2013  |  Published in Political Economy, Politics, Socialism, Work

The Universal Basic Income hit the Washington Post again this weekend, courtesy of Mike Konczal. He focuses on left objections to the UBI proposal, ranging from its effect on gender equality to its relationship with the existing welfare state to its interaction with the struggle for workplace democracy. In the end, he emphasizes the benefits of the UBI, and insists that while we’re unlikely to see basic income in the United States anytime soon, it’s still worth “taking a moment to think Utopian”.

Matt Bruenig objects to Konczal’s characterization of the basic income as “utopian”, on the grounds that it is not something that “proposes to dramatically overhaul society into an entirely unprecedented structure that will usher in a nearly perfect world.” It is only utopian in the very weak sense that it is not currently on the political agenda as something that is likely to be enacted.

It’s certainly true that basic income is hardly utopian in its etymological sense of meaning “nowhere”. A recent article in Le Monde Diplomatique describes an experiment with UBI in an Indian village. The experiment is run by a trade union called the Self Employed Women’s Association, and it found that with just an extra $3.65 per month, “people spent more on eggs, meat and fish, and on healthcare. Children’s school marks improved in 68% of families, and the time they spent at school nearly tripled. Saving also tripled, and twice as many people were able to start a new business.” This is consistent with the results found in basic income experiments in Namibia and in 1970′s Canada.

Meanwhile, there have long been critics on the Left who criticize basic income proposals precisely for their perceived lack of utopianism. As Konczal notes, Barbara Bergmann argues that it is more important to secure broader access to specific goods like child care, health care, and education: “The fully developed welfare state deserves priority over Basic Income because it accomplishes what Basic Income does not: it guarantees that certain specific human needs will be met.” In a New Left Review essay, Göran Therborn strikes a similar tone, referring to the basic income as a “curious utopia of resignation” arising in response to welfare state retrenchment and diminished prospects for working class control over the workplace or the means of production.

From the perspective of the basic income’s leftist advocates, however, there is another way in which it can be considered a deeply utopian project. Fredric Jameson discusses two different meanings of utopia in his study of utopian politics and science fiction, Archaeologies of the Future. The first is utopia as a fully-elaborated program for the future society, which is close to Bruenig’s sense of the proposal to dramatically overhaul society. But the second is the utopian impulse, which appears across much broader domains of everyday life and politics, including even “piecemeal social democratic and ‘liberal’ reforms”. Such impulses may not themselves be the program for a utopian society, but they can point in the direction of future programmatic realizations.

The French writer André Gorz was a longtime proponent of the basic income, and is also responsible for a well-known theorization of its utopian transformative potential. In one of his early works, Strategy for Labor, he attempted to do away with the tired Left debate over “reform or revolution” and replace it with a new distinction:

Is it possible from within—that is to say, without having previously destroyed capitalism—to impose anti-capitalist solutions which will not immediately be incorporated into and subordinated to the system? This is the old question of “reform or revolution.” This was (or is) a paramount question when the movement had (or has) the choice between a struggle for reforms and armed insurrection. Such is no longer the case in Western Europe; here there is no longer an alternative. The question here revolves around the possibility of “revolutionary reforms,” that is to say, of reforms which advance toward a radical transformation of society. Is this possible?

Gorz goes on to distinguish “reformist reforms”, which subordinate themselves to the need to preserve the functioning of the existing system, from the radical alternative:

A non-reformist reform is determined not in terms of what can be, but what should be. And finally, it bases the possibility of attaining its objective on the implementation of fundamental political and economic changes. These changes can be sudden, just as they can be gradual. But in any case they assume a modification of the relations of power; they assume that the workers will take over powers or assert a force (that is to say, a non-institutionalized force) strong enough to establish, maintain, and expand those tendencies within the system which serve to weaken capitalism and to shake its joints. They assume structural reforms.

One criticism of the basic income is that it will not be systemically viable over the long run, as people increasingly drop out of paid labor and undermine the tax base that funds the basic income in the first place. But from another point of view, this prospect is precisely what makes basic income a non-reformist reform. Thus one can sketch out a more programmatic kind of utopianism that uses the basic income as its point of departure. One of my favorite gestures in this direction is Robert van der Veen and Philippe van Parijs’ 1986 essay, “A Capitalist Road to Communism”.

The essay begins from the proposition that Marxism’s ultimate end is not socialism, but rather a communist society that abolishes not merely exploitation (the unjust distribution of the social product relative to work performed) but also alienation: “productive activities need no longer be prompted by external rewards”.

They then go on to sketch out a scenario in which a reform instituted under capitalism leads to communism without the intermediary stage of socialist construction. This thought experiment revolves around the achievement of an unconditional, universal basic income. Suppose, they say, “that it is possible to provide everyone with a universal grant sufficient to cover his or her ‘fundamental needs’ without this involving the economy in a downward spiral. How does the economy evolve once such a universal grant is introduced?”

Their answer is that the basic income would “twist” the capitalist drive to increase productivity, such that:

Entitlement to a substantial universal grant will simultaneously push up the wage rate for unattractive, unrewarding work (which no one is now forced to accept in order to survive) and bring down the average wage rate for attractive, intrinsically rewarding work (because fundamental needs are covered anyway, people can now accept a high-quality job paid far below the guaranteed income level). Consequently, the capitalist logic of profit will, much more than previously, foster technical innovation and organizational change that improve the quality of work and thereby reduce the drudgery required per unit of product.

If you extrapolate this trend forward, you reach a situation where all wage labor is gradually eliminated. Undesirable work is fully automated, as employers feel increasing pressure to automate because labor is no longer too cheap. Meanwhile, the wage for desirable work eventually falls to zero, because people are both willing to do it for free, and able to do so due to the existence of a basic income to supply their essential needs. As Gorz puts it in a later work, the Critique of Economic Reason, certain activities “may be partially repatriated into the sphere of autonomous activities and reduce the demand for these things to be provided by external services, whether public or commercial.”

The long-run trajectory, therefore, is one in which people come to depend less and less on the basic income, because the things they want and need do not have to be purchased for money. Some things can be produced costlessly and automatically, as 3-D printing and digital copying technologies evolve into something like Star Trek’s replicator. Other things have become the product of voluntary co-operative activity, rather than waged work. It therefore comes to pass that the tax base for the basic income is undermined—but rather than a crisis, as in the hands of basic income critics, this becomes the path to utopia.

Consider, for example, a basic income that was linked to the size of Gross Domestic Product. We are used to a capitalist world in which the increase in material prosperity corresponds to a rise in GDP, the measured value of economic activity in money. But as wage labor comes to be replaced either by automation or voluntary activity, GDP would begin to fall, and the basic income with it. This would not lead to lowered standards of living, because the falling GDP here also denotes a decline in the cost of living. Just like the socialist state in certain versions of traditional Marxism, the basic income withers away. As van der Veen and van Parijs put it, “capitalist societies will smoothly move toward full communism.”

The capitalist road to communism is truly a utopia. Not only in the colloquial sense of a total transformation of a society, but also in its overly simplified and rationalistic picture of social evolution. As Jameson notes, utopias are defined as much by their closures and exclusions as their positive programs, as much by what they cannot say as what they can. A utopia often says more about the present in which it was written than it does about the future it depicts.

In the case of the capitalist road to communism, the things left out include the political struggles that would ensue if social development threatened to evolve the capitalist class out of existence, gradually sapping their profits and their social power. This began to manifest itself even under the meager basic income in the Namibian experiment: white landlords were deeply hostile to the basic income and denied the evidence of its benefits, perhaps because they are “afraid that the poor will gain some influence and deprive the rich, white 20 percent of the population of some of their power.” Also brushed aside are the ecological limits that might make true abundance elusive. Both of these are themes I attempted to flesh out in “Four Futures”. A third issue, which I’ve discussed a bit elsewhere, is the ingrained gender norms that may be reinforced by expanding the domain of “voluntary” labor, which often amounts the imposition of unpaid work on women. But the conceptual clarity of van der Veen and van Parijs’ rendition is enlightening in its very implausibility and incompleteness, a demonstration of the utopian impulse contained in an apparently timid policy proposal.

We Have Always Been Rentiers

April 22nd, 2013  |  Published in anti-Star Trek, Political Economy, Statistics

In my periodic discussions of contemporary capitalism and its potential transition into a rentier-dominated economy, I have emphasized the point that an economy based on private property depends upon the state to define and enforce just what counts as property, and what rights come with owning that property. (The point is perhaps made most directly in this essay for The New Inquiry.) Just as capitalism required that the commons in land be enclosed and transformed into the property of individuals, so what I’ve called “rentism” requires the extension of intellectual property: the right to control the copying and modification of patterns, and not just of physical objects.

But the development of rentism entails not just a change in the laws, but in the way the economy itself is measured and defined. Since capitalism is rooted in the quantitative reduction of human action to the accumulation of money, the way in which it quantifies itself has great economic and political significance. To relate this back to my last post: much was made of the empirical and conceptual worthiness of Reinhart and Rogoff’s link between government debt and economic growth, but all such disputations presume agreement about the measurement of economic growth itself.

Which brings us to the United States Bureau of Economic Analysis, and its surprisingly fascinating “Preview of the 2013 Comprehensive Revision of the National Income and Product Accounts”. The paper describes a change in the way the government represents the size of various parts of the economy, and therefore economic growth. The most significant changes are these:

Recognize expenditures by business, government, and nonprofit institutions serving households (NPISH) on research and development as fixed investment.

Recognize expenditures by business and NPISH on entertainment, literary, and other artistic originals as fixed investment.

The essential issue is whether spending on Research and Development, and on the production of creative works, should be regarded merely as an input to other production processes, or instead as an investment in the creation of a distinct value-bearing asset. The BEA report observes that “expenditures for R&D have long been recognized as having the characteristics of fixed assets—defined ownership rights, long-lasting, and repeated use and benefit in the production process”, and that therefore the BEA “recogniz[es] that the asset boundary should be expanded to include innovative activities.” Likewise, “some entertainment, literary, and other artistic originals are designed to generate mass reproductions for sale to the general public and to have a useful lifespan of more than one year.” Thus the need for “a new asset category entitled ‘intellectual property products’,” which will encompass both types of property.

What the BEA calls “expanding the asset boundary” is precisely the redefinition of the property form that I’ve written about—only now it is a statistical rather than a legal redefinition. And that change in measurement will be written backwards into the past as well as forwards into the future: national accounts going back to 1929 will be revised to account for the newly expansive view of assets.

Here the statisticians are only following a long legal trend, in which the state treats immaterial patterns as a sort of physical asset. It may be a coincidence, but the BEA’s decision to start its revisionist statistical account in the 1920′s matches the point at which U.S. copyright law became fully disconnected from its original emphasis on limited and temporary protections subordinated to social benefits. Under the Copyright Term Extension Act, creative works made in 1923 and afterwards have remained out of the public domain, perpetually maintaining them as private assets rather than public goods.

A careful reading of the BEA report shows the way in which the very statistical definitions employed in the new accounts rely upon the prior efforts of the state to promote the profitability of the intellectual property form. In its discussion of creative works, the report notes that “entertainment originals are rarely sold in an open market, so it is difficult to observe market prices . . . a common problem with measuring the value of intangible assets.” As libertarian critics like to point out, an economy based on intellectual property must be organized around monopoly rather than direct competition.

In order to measure the value of intangible assets, therefore, the BEA takes a different approach. For R&D, “BEA analyzed the relationship between investment in R&D and future profits . . . in which each period’s R&D investment contributes to the profits in later periods.” Likewise for creative works, BEA will “estimate the value of these as­sets based on the NPV [Net Present Value] of expected future royalties or other revenue obtained from these assets”.

Here we see the reciprocal operation of state power and statistical measurement. Insofar as the state collaborates with copyright holders to stamp out unauthorized copying (“piracy”), and insofar as the courts uphold stringent patent rights, the potential revenue stream that can be derived from owning IP will grow. And now that the system of national accounts has validated such revenues as a part of the value of intangible assets, the copyright and patent cartels can justly claim to be important contributors to the growth of the Gross Domestic Product.

The BEA also has interesting things to say about how their new definitions will impact different components of the overall national accounts aggregate. They note that the categories of “corporate profits” and “proprietors’ income” will increase—an accounting convention perhaps, but one that accurately reflects the constituencies that stand to benefit from the control of intellectual property. Thus the new economic order being mapped by the BEA fits in neatly with Steve Waldman’s excellent recent post about late capitalism’s “technologically-driven resource curse, coalescing into groups of insiders and outsiders and people fighting at the margins not to be left behind.”

The changes related to R&D and artistic works may be the most significant, but the other three revisions in the report are worth noting as well. One has to do with the costs associated with transferring residential fixed assets (e.g., the closing costs related to buying a house), while another has to do with the accounting applied to pension plans. Only the final one, a technical harmonization, has to do directly with wages and salaries. This is perhaps an accurate reflection of an economic elite more preoccupied with asset values than with the direct returns to wage labor.

Finally, the reception of the BEA report provides another “peril of wonkery”, related to the one I described in my last post. The Wonkblog post about the report makes some effort to acknowledge the socially constructed nature of economic statistics: “the assumptions you make in creating your benchmark economic statistics can create big swings in the reality you see.” And yet the post then moves directly on to claim that in light of the statistical revisions, “the U.S. economy is even more heavily driven by the iPad designers and George Lucases of the world—and proportionally less by the guys who assemble washing machines—than we thought.” This is no doubt how the matter will be described going forward. But the new measurement strategies are only manifestations of a choice to attribute a greater share of our material wealth to designers and directors, and that choice has more to do with class struggle than with statistics.

In Defense of Soviet Waiters

February 5th, 2013  |  Published in Everyday life, Political Economy, Socialism, Work

There’s been a bit of a discussion about affective labor going around. Paul Myerscough in the London Review of Books describes the elaborate code with which the Pret a Manger chain enforces an ersatz cheerfulness and dedication on the part of its employees, who are expected to be “smiling, reacting to each other, happy, engaged”. Echoing a remark of Giraudoux and George Burns, the most important thing to fake is sincerity: “authenticity of being happy is important”.

Tim Noah and Josh Eidelson elaborate on this theme, and Sarah Jaffe makes the point that this has always been an extremely gendered aspect of labor (waged and otherwise). She notes that “women have been fighting for decades to make the point that they don’t do their work for the love of it; they do it because women are expected to do it.” Employers, of course, would prefer equality to be established by imposing the love of work on both genders.

Noah describes the way Pret a Manger keeps “its sales clerks in a state of enforced rapture through policies vaguely reminiscent of the old East German Stasi”. I was reminded of the Soviet model too, but in a different way. I’m just old enough to remember when people talked about the Communist world as a really-existing place rather than a vaguely-defined bogeyman. And one of the mundane tropes that always came up foreign travelogues from behind the Iron Curtain concerned the notoriously surly service workers, in particular restaurant waiters. A 1977 newspaper headline reads “Soviet Union Takes Hard Look At Surly Waiters, Long Lines”. In a 1984 dispatch in the New York Times, John Burns reports that “faced with inadequate supplies, low salaries and endless lines of customers, many Russians in customer-service jobs lapse into an indifference bordering on contempt.”

One can find numerous explanations of this phenomenon, from the shortcomings of the planned economy to the institutional structure of the Soviet service industry to the vagaries of the Russian soul to the legacy of serfdom. But one factor was clearly that Soviet workers, unlike their American counterparts, were guaranteed jobs, wages, and access to essential needs like housing, education, and health care. The fear that enforces fake happiness among capitalist service workers—culminating in the grotesquery of Pret a Manger—was mostly inoperative in the Soviet Union. As an article in the Moscow Times explains:

During the perestroika era, the American smile was a common reference point when the topic of rude Soviet service was discussed. In an often-quoted exchange that took place on a late-1980s television talk show, one participant said, “In the United States, store employees smile, but everyone knows that the smiles are insincere.” Another answered, “Better to have insincere American smiles than our very sincere Soviet rudeness!”

With the collapse of the USSR and the penetration of Western capital into Russia, employers discovered a workforce that adapted only reluctantly to the norms of capitalist work discipline. A 1990 article in USA Today opens with a description of the travails facing the first Pizza Hut in the Soviet Union:

To open the first Pizza Hut restaurants in the Soviet Union, U.S. managers had to teach Soviet workers how to find the ”you” in U.S.S.R.

”We taught them the concept of customer service,” says Rita Renth, just back from the experience. ”Things that come naturally to employees here we had to teach them to do: -smiling, interacting with customers, eye contact.”

In no time, however, the managers hit on what I’ve described as the third wave form of the work ethic. Rather than appealing to religious salvation or material prosperity, workers are told that they should find their drudgery intrinsically enjoyable:

The five U.S. managers – and colleagues from Pizza Huts in the United Kingdom, Belgium, Australia and other nations – spent 12 to 14 hours a day drilling the Russians on service and food preparation, Pizza Hut style.

As a way of ”motivating them to be excited about what they were doing, we made (tasks) like folding boxes into a contest,” Rae says. ”When they finished, they said they couldn’t believe they would ever have fun at their jobs.”

That feeling, rare in Soviet workplaces, has been noticed. ”A comment made by a lot of customers was that as soon as they walked in, they sensed a feeling of warmth,” Rae says.

It’s the Pret a Manger approach to enforced cheerfulness (which had better be authentic!), combined with gamification, 1990-style. Along the same lines is this blog post from a business school professor, who recounts the experience of the first Russian McDonald’s:

After several days of training about customer service at McDonald’s, a young Soviet teenager asked the McDonald’s trainer a very serious question: “Why do we have to be so nice to the customers? After all, WE have the hamburgers, and they don’t!”

True enough. But while they may have had the hamburgers, with the collapse of Communism they no longer had steady access to the means of payment.

The brusqueness of customer service interactions has typically been interpreted as an indication of Communism’s shortcomings, their low quality understood as a mark of capitalism’s superiority. And it does indicate a contradiction of the Soviet model, which preserved the form of wage labor while removing many of the disciplinary mechanisms—the threat of unemployment, of destitution—that force workers to accept the discipline of the employer or the customers. That contradiction comes to a head in a restaurant where both employees and customers are miserable. As the old saying goes, “they pretend to pay us, and we pretend to work”.

In his recent essay, Seth Ackerman cautions that present-day socialists shouldn’t overlook the material shortcomings of the planned economies, and he notes that “the shabbiness of consumer supply was popularly felt as a betrayal of the humanistic mission of socialism itself”. But service work is a bit different from the kind of material shabbiness he discusses, since the product and the worker are inseparable. To demand what we’ve come to think of as “good service” is ultimately to demand the kind of affective—and affected—labor that we see throughout the service industry and especially in female-gendered occupations. Paul Myerscough is clearly unsettled by a system in which, “To guard against the possibility of Pret workers allowing themselves to behave even for a moment as if they were ‘just here for the money’, the company maintains a panoptical regime of surveillance and assessment.” But 30 years ago, journalists like Myerscough were the sort of people grousing about rude Moscow waiters.

In a system based on wage labor (or its approximation), the choice between company-enforced cheerfulness or authentic resentment is unavoidable. In other words, fake American smiles or sincere Soviet rudeness. The customer service interaction under capitalism can hardly avoid the collision between fearful resentment and self-deluding condescension, of the sort Tim Noah enacts in his opening: “For a good long while, I let myself think that the slender platinum blonde behind the counter at Pret A Manger was in love with me.” Perhaps it’s time to look back with a bit of nostalgia on the surly Communist waiters of yore, whose orientation toward the system was at least transparent.

I have argued many times that the essence of the social democratic project—and for the time being, the socialist project as well—is the empowerment of labor. By means of full employment, the separation of income from employment, and the organization of workers, people gain the ability to resist the demands of the boss. But the case of affective labor is another example that shows why this supposedly tepid and reformist project is ultimately radical and unstable. Take away the lash of the boss, and you are suddenly forced to confront service employees as human beings with human emotions, without their company-supplied masks of enforced good cheer. Revealing the true condition of service work can be a de-fetishizing experience, one just as jarring—and quite a bit closer to home—than finding out how your iPhone was manufactured. In both cases, we are made to confront unpleasant truths about the power relations that structure all of our experiences as consumers.

Robots and Liberalism

December 12th, 2012  |  Published in anti-Star Trek, Political Economy, Politics, Socialism, Time, Work

People know my beat by now, so everyone has been directing my attention to Paul Krugman’s recent musings on the pace of automation in the economy. He moves away from his earlier preoccupation with worker skills, and toward the possibility of “‘capital-biased technological change’, which tends to shift the distribution of income away from workers to the owners of capital.” He goes on to present data showing the secular decline in labor’s share of income since the 1970′s.

He then notes that his position “has echoes of old-fashioned Marxism”, but reassures us that this uncomfortable realization “shouldn’t be a reason to ignore facts”. The implication of those facts, he says, are that neither the liberal nor conservative common sense has anything to say about our current predicament: “Better education won’t do much to reduce inequality if the big rewards simply go to those with the most assets. Creating an “opportunity society” . . . won’t do much if the most important asset you can have in life is, well, lots of assets inherited from your parents.”

Meanwhile we have Kevin Drum despairing that the coming decades will be “mighty grim”, as automation means that “the owners of capital will automate more and more, putting more and more people out of work”. And we have the Financial Times publishing Izabella Kaminska arguing that “we’ve now arrived at a point where technology begins to threaten return on capital, mostly by causing the sort of abundance that depresses prices to the point where many goods have no choice but to become free.” This, of course, leads to attempts to impose artificial scarcity through new forms of property rights (with dire consequences for growth and prosperity), but I’ve written all about that elsewhere.

What I mainly find interesting is what all this interest in technology and jobless growth says about the limits of contemporary liberalism. We can all hope that Gavin Mueller’s reverie of Paul Krugman dropping LSD and becoming a Marxist will come to pass, but in the meantime his type seems to have no real answer. Nor do those of a more labor-liberal bent, like Dan Crawford at Angry Bear, who laments being called a neo-luddite and scornfully says: “As if widespread use of automated systems was automatically good for us overall”. As if a world in which we hold back technical change in order to keep everyone locked into deadening jobs is a vision that will rally the masses to liberalism.

In its more sophisticated form, this kind of politics takes the form of Ed Miliband’s “predistribution”, which Richard Seymour glosses as a belief that “rather than taxing the rich to fund welfare, the government should focus on making work pay more.” But if the structure of the modern economy is, as Krugman argues, one which depends on increasing numbers of robots and diminishing numbers of people, this project is bound to be either ineffectual or pointlessly destructive of our potential social wealth. The idea that there is something inherently superior, either politically or morally, about raising pre-tax and transfer incomes, rather than doing redistribution, is one that has never seemed to me to be especially well grounded. At times I suspect that it stems from an uncritical embrace of the historically specific white populist identity politics of the working class, and its accompanying fetish for the point of production, that I talk about here.

Not to say I have all the answers either, but here on the crazy Left we at least have some ideas. Ideas that don’t presuppose the desirability of keeping the assembly line of employment going at all costs, pumping out something that we can call “middle class jobs”. Ideas that get back to crazy notions like working time reduction and the decommodification of labor. These days, the unrealistic utopians are the nostalgics for the Fordist compromise, who see the factory worker with a high school diploma and a middle class income as the apex of human emancipation. But as Lenin said, “One can never be radical enough; that is, one must always try to be as radical as reality itself”.

Economic Personalities for our Grandchildren

November 18th, 2012  |  Published in Political Economy, Work

Given the origins of my blog’s name, I’ve avoided posting on Mondays. But I don’t get paid for doing this, and so this was a misbegotten impulse for the reasons I explain below.

Yesterday I heard two interviews that helpfully recontextualize some common economic arguments about money and motivation, and provide another angle on the discussion of jobs in my last post. The first is with singer Chris Cornell of the recently re-formed Soundgarden, talking about what got him into music:

I got a GED based on Catholic school seventh-grade education, really. I didn’t make it that far. I have all those regrets now. … I just kind of went into the blue-collar workforce at a really young age and discovered music, in terms of being a musician, around the same time. The good news is, I was probably 17 when I knew that’s what I was going to do with the rest of my life, no matter what that meant. Even if that meant that I had to be a dishwasher or a janitor to support being in a band that I love and writing music that I love, I would be happy with that. So I feel fortunate. In spite of my lack of education, I didn’t lack direction.

The second was with the writer Fran Lebowitz, on Jesse Thorn’s show “Bullseye”. After Thorn asks her about the erratic appearance of her work, Lebowitz relates that she loved to write as a young woman, but developed crippling writers’ block once she began to get paid to write. She posits that she is “so resistant to authority, that I am even resistant to my own authority.” She later declares herself to hate work and be incorrigibly lazy, but the earlier comment hints at a more complex explanation. Transforming writing into an economic compulsion seems to have undermined intrinsic motivation, consistent with a long line of research in behavioral economics.

There’s nothing particularly original or shocking about these interviews. We all know that people are motivated by much more than money. Just today, I saw two posts on this theme, from Nancy Folbre on child-rearing and Matt Yglesias on people who take reductions in income in return for job satisfaction. Yet according to the hegemonic common-sense form of economic reasoning, neither of these people should exist. If you want someone to do something, the common argument goes, you should give them a financial incentive. But Cornell isn’t motivated by money, if we take him at his word (and even if he really wouldn’t have kept at it without stardom, there are many others who do.) And Lebowitz is actively de-motivated to write by getting paid for it, illustrating the adage that the best way to ruin something you love is to make it your job.

It’s people like this that I’m thinking of when I say that with reductions in working time and something like a generous Universal Basic Income, we would begin to discover what work people will continue to do whether or not they get paid for it. That’s not to say that all work can be taken care of this way; it’s hard to imagine an inverse of Chris Cornell who takes a day job as a rock singer to fund his passion for dishwashing. But we can at least start asking why we don’t make an effort to restrict wage labor to areas where it actually incentivizes something.

This relates to a topic Mike Konczal brings up in his new American Prospect article, about the debate between proponents of the UBI (like me), and those like the sociologist Lane Kenworthy who prefer policies that are tied to participation in wage labor, like the Earned Income Tax Credit. Kenworthy worries about the disincentive to employment that a UBI would create, but I’m more interested in the way that it would open up space for people to do socially desirable but non-remunerated things (and also to reconsider how we distribute the burden of socially desirable but personally unpleasant work). We already have too much wage labor, from this perspective, so we shouldn’t be so worried about getting more of it. So I agree, in a sense, with Trevor Burrus of the Cato Institute of all people, who says we should champion “a system where productivity allows people to be artists, record store clerks, or even bums.” Of course, Burrus calls that system “the free market”, where I would locate it in something rather different.

It’s because of people like Cornell and Lebowitz, perhaps, that I don’t worry as much as Keynes did, in “Economic Possibilities for our Grandchildren”, about how people will find ways to use their expanded leisure time. He posed it as humanity’s “permanent problem—how to use his freedom from pressing economic cares, how to occupy the leisure . . . to live wisely and agreeably and well”. It’s a theme recently brought up anew by Keynes biographer Robert Skidelsky and his philosopher son Edward, who return to ancient philosophy’s preoccupation with defining the good life in their fascinating (yet maddening) book Enough. But I ultimately have a lot of optimism about what people are capable of, and I believe a socialist future would, among other things, bring us more music and literature from the Chris Cornells and Fran Lebowitzes than does the system we live in now.

Hostess and the Limits of the Private Welfare State

November 16th, 2012  |  Published in Political Economy, Work

Hostess Brands, maker of the Twinkie, announced its liquidation today. This provoked a wave of now-more-than-everism, as both liberals and conservatives rushed to use the company’s failure as a testament to their longstanding hobbyhorses.

To the Right, of course, the end of Hostess is just another great opportunity to bash unions. Although perhaps it’s a sign of progress that even Fox News decided to soft-pedal this line, talking up the conciliatory position of the Teamsters while blaming the recalcitrance of the Bakery, Confectionary, Tobacco Workers and Grain Millers union for the closure. The idea that this is all about greedy unions is idiotic beyond belief, but sadly something we apparently still have to talk about. So if you don’t believe me you can go read Sarah Jaffe or Diana Reese.

A line I’m seeing from liberals, meanwhile, is that this is another case of private equity vulture capitalism ruining the American dream. Hostess Brands was under the control of a couple of hedge funds, as is the style these days. And so one line of argument is that Hostess could have been a perfectly sustainable company with good paying jobs, if only those short-sighted PE guys hadn’t showed up to loot it. A typical example of the genre is this from Laura Clawson at Daily Kos. Mark Price puts it more pithily on Twitter: “Private equity runs up debt, takes out fees and investment in capital goods declines leading to cost disadvantages.”

There’s no question that this is part of the story. The usual antics seem to be at work here, like levering up the company with debt and giving big pay raises to top management even as the business was going under. But Hostess had big problems even before the hedge fund guys showed up. Part of it was that on the marketing side, people just got less interested in eating Wonder Bread and Twinkies, and Hostess never managed to come up with any successful replacement products.

Moreover, the structure of the company’s labor costs is not a completely bogus issue either. The main issue, as it often is in these cases, isn’t wages but benefits, especially for retired workers. When Hostess went into bankruptcy earlier this year, Pensions & Investments reported that seven of its eight largest unsecured creditors were union pension funds, and that the company faced $130 million per year of required contributions to these plans. And like all American companies that offer health insurance, they faced rising health care costs due to U.S.’s uniquely irrational and inefficient system of privatized health care. It’s absolutely true that these benefits were negotiated fair and square, and the workers have every right to them. But promising future benefits without worrying too much about how to pay for them is a problem for a lot of companies, and it was a way of pretending to continue the Fordist compromise of labor-peace-for-rising-wages long after it had become inoperative in reality. Continuing to fight on this terrain will always put labor on the defensive. It’s worth noting that the Teamsters’ own position already included significant concessions on pensions.

It may or may not have been possible to keep servicing all these obligations while keeping the company profitable, under more enlightened management. But keeping Hostess in business so they can give people good pay and benefits to make Twinkies seems like exactly the style of small-minded Keynesian hole-digging that I criticized in “Against Jobs”. These workers deserve universal health care, a good pension from Social Security, and dare I say it, even a Universal Basic Income to support them while they try to find other jobs. The fact that we depend on a privatized welfare state where all these things are tied to jobs is bad for workers and bad for the country. It feeds into the problem Ashwin Parameswaran discusses in this post, a quixotic search for “a stable system where labour and capital are both protected from the dangers of failure”, one which “inevitably breeds a fragile and disadvantaged working class” that is fragmented into groups of protected insiders looking to protect their status, rather than act in solidarity as a class. I can’t recommend that post enough if you, like a lot of people I interact with, have any affinity for the project of “somehow recreat[ing] the golden age of the 50s and the 60s i.e. stability for all.”

Another reaction I’ve been seeing is “I don’t feel bad about Hostess failing, but I feel bad for these workers”. That’s more than a passing ambivalence, it’s a deep contradiction in our labor politics. I don’t care much about Twinkies one way or the other, but there are plenty of other areas where Leftists definitely need to be comfortable with being job-killers: coal-mining, say, or debt collection. In support of that agenda, we need to be thinking not just about creating or protecting jobs, but about the kind of expansive welfare state that Bhaskar Sunkara and I talked about recently at In These Times. The de-commodification of labor may be off the agenda right now, but we desperately need to bring it back.

The Disposition Matrix

October 24th, 2012  |  Published in anti-Star Trek, Political Economy, Politics

“The Disposition Matrix” sounds like a dystopian science fiction novel. And indeed it is, but unfortunately it’s being written by the American counter-terrorism bureaucracy, and rolled out as the blueprint for a future of state-sanctioned death squads.

The Washington Post prints a riveting chapter of this story, a sequel to Obama’s notorious “kill list”. We discover the existence of a “next generation targeting list” (the aforementioned matrix), a spreadsheet of doom which will be used to keep track of all the undesirables now targeted for elimination by the CIA.

The story expertly combines bureaucratic tedium with horrific violence, and it is full of bizarre and terrifying lines. “The database is designed to go beyond existing kill lists, mapping plans for the ‘disposition’ of suspects beyond the reach of American drones.” Drone assasination is now the first resort of the state.


“‘We can’t possibly kill everyone who wants to harm us,’ a senior administration official said. ‘It’s a necessary part of what we do.’” Killing is ineffectual, which is why killing must remain our business forever. “Mitt Romney made it clear that he would continue the drone campaign. ‘We can’t kill our way out of this,’ he said, but added later that Obama was ‘right to up the usage’ of drone strikes and that he would do the same.” We can’t kill our way out of this, so we must keep killing. You must go on. You can’t go on. You’ll go on.

“‘We had a disposition problem,’ said a former U.S. counterterrorism official involved in developing the matrix.” The problem was that there remained some people that the U.S. government was unable to kill.

Once, a man was captured off the coast of Yemen. “‘Warsame was a classic case of “What are we going to do with him?” ‘ the former counterterrorism official said. In such cases, the matrix lays out plans.” Perhaps we require “camps . . . used for ‘suspects’ whose offenses could not be proved and who could not be sentenced by ordinary process of law.”

“The proposal, which would need White House approval, reflects the [CIA]‘s transformation into a paramilitary force, and makes clear that it does not intend to dismantle its drone program and return to its pre-Sept. 11 focus on gathering intelligence.” This will be very different from the Tonton Macoutes. There will be no rustic straw hats and denim shirts this time.

“The matrix was developed by the NCTC, under former director Michael Leiter, to augment those organizations’ separate but overlapping kill lists, officials said.” This is typical of the bloated, inefficient government bureaucracy. One day they’ll think to outsource the machinery of death entirely.

“‘The problem with the drone is it’s like your lawn mower,’ said Bruce Riedel, a former CIA analyst and Obama counterterrorism adviser. ‘You’ve got to mow the lawn all the time. The minute you stop mowing, the grass is going to grow back.’” You kill them and kill them, but they just keep growing back. After a time, “Targeted killing is now so routine that the Obama administration has spent much of the past year codifying and streamlining the processes that sustain it.”

“The approach also applies to the development of criteria for ‘signature strikes,’ which allow the CIA and JSOC to hit targets based on patterns of activity . . . even when the identities of those who would be killed is unclear.” Like Google’s search algorithm, the characteristics that will make you deserving of government assasination are obscure.

“For an administration that is the first to embrace targeted killing on a wide scale, officials seem confident that they have devised an approach that is so bureaucratically, legally and morally sound that future administrations will follow suit.” Barack Obama truly deserved his Nobel peace prize after all; he inaugurated the most moral campaign of wide scale killing in history.

“The number of targets on the lists isn’t fixed, officials said, but fluctuates based on adjustments to criteria. Officials defended the arrangement even while acknowledging an erosion in the caliber of operatives placed in the drones’ cross hairs.” Targeted killing used to be glamorous and sophisticated, but these days it’s a bore. All the good targets are already dead.

“A senior aide to Panetta disputed this account, and said Panetta mentioned the shrinking target list during his trip to Islamabad but didn’t raise the prospect that drone strikes would end. Two former U.S. officials said the White House told Panetta to avoid even hinting at commitments the United States was not prepared to keep.” If we stop the killing, the terrorists will have won. If we say that we will stop the killing in the future, the terrorists will have won. If we hint that we might commit to stopping the killing in the future, the terrorists will have won.


It comes back, as it always does for me, to “Four Futures”. The fourth chapter of that essay is titled “Exterminism”, and it suggests the following:

Many of the rich . . . have resigned themselves to barricading themselves into their fortresses, to be protected by unmanned drones and private military contractors. Guard labor . . . reappears in an even more malevolent form, as a lucky few are employed as enforcers and protectors for the rich.

But this too, is an unstable equilibrium, for the same basic reason that buying off the masses is. So long as the immiserated hordes exist, there is the danger that it may one day become impossible to hold them at bay. Once mass labor has been rendered superfluous, a final solution lurks: the genocidal war of the rich against the poor.

Until now, we have relied on the prison system to warehouse the unemployed and unemployable, but there just seem to be more and more of them. How long until someone like Pete Peterson demands, in the name of fiscal responsibility, that we begin liquidating these stocks of unproductive bodies?

Fortunately, the disposition matrix has nothing to do with such fears. The targets of the lists are not surplus labor, after all, we are merely terrorists.

Ecology, Technology, and Scale

October 10th, 2012  |  Published in Political Economy, Politics, Socialism

In the debate between Alex Gourevitch on one side, and Chris Bertram and Jacobin contributing editor Max Ajl on the other, I’d put myself more on Bertram and Ajl’s side. Gourevitch’s essay was a bit too long on caricatures of environmentalism, and too short on critiques of the particular way in which development operates in capitalism.

I do think, though, that Ajl’s opening is a bit misleading as to the substance of his argument. He ridicules Gourevitch’s call for “control and manipulation of nature” as “pure ideology”, and insists that “ecological problems are not resolvable through endless technofixes”. But the further control and manipulation of nature by means of technology is then precisely what he goes on to advocate. What separates the two positions is that while Gourevitch tends toward an uncritical conflation of “development” and “capitalist development”, Ajl outlines an explicitly ecological (though not necessarily anti-capitalist) path of development, involving things like high-speed rail networks and alternative energy systems.

Ajl’s other important point is to separate the defense of advanced technological society from the praise of large scale, centralized industrialization. As Bertram notes in his post, there is a sort of stagist theory of history implicit in Gourevitch’s argument, in which poor countries must pass through the same kind of industrial development that characterized the imperial metropoles in the twentieth century. In fact, it is possible for poor regions to skip over some parts of the earlier history of industrialization entirely. Hence we see countries skipping the buildout of land line telephones in favor of cellular, and the same may happen with distributed solar power generation.

Thus, while the specific criticisms Gourevitch makes (on Palestinian bicycle generators and the California energy crisis) are mostly on target, he is too quick to dismiss “federated, small-scale self-sufficient production communities” entirely. As Ajl notes, a red-green vision may reject retreating into some pre-industrial past, but it is also about something more than just generalizing current rich country ways of life to the whole world.

I’m jumping into all this because it connects to my last post on 3-D printers and related small-scale fabrication technologies.* One of the appealing things about these technologies is that, as Juliet Schor notes in this post, they have the potential to make high-productivity but small scale production much more viable. This implies that an increasingly productive economy need not be identical with an increasingly centralized and hierarchical one. Which is not to say that big and complex infrastructural systems can be done away with entirely, only that they can be a less important part of our material culture. It may turn out that the industrial age was actually the apex of economic “bigness”, and that the post-industrial future will be both more decentralized and richer, a manifestation of what Ursula Leguin calls a “genuinely mature society” that employs advanced technology but has transcended the capitalist imperative to constantly grow and expand.

This would be very fortunate, and not only for reasons of ecological sustainability. Ashwin Parameswaran, in his many posts at Macroeconomic Resilience, has discussed the way in which contemporary capitalism is the endpoint of the high-modernist “control revolution”. In his view, post-Fordism is merely a completion of the Fordist project of “systematising each element of the industrial process”, and “introducing order and legibility into a fundamentally opaque environment via a process that reduces human involvement and discretion by replacing intuitive judgments with rules and algorithms.” The attempt to stabilize the incredibly complex systems of a modern macro-economy then leads, he says, to a situation in which the rules and feedback loops are so complex that they render “the system fundamentally illegible to the human operator”. According to this analysis, our current version of “too big to fail” crony capitalism actually has much in common with the Soviet project, which ultimately failed “due to its too successful adherence and implementation of the high-modernist ideal.”

In recent times, decentralization of the economy has been rhetorically associated with the libertarian right (even if, as Parameswaran argues, their project was actually a continuation of the control revolution). There is no reason, however, for the Left to respond by fetishizing bigness, which would be no better an answer than the the fetish for smallness that afflicts some of the environmentalists Gourevitch criticizes.

  • As an aside, I should clarify that some of what I discussed in that post was speculative, and not meant to describe the current state of these technologies. In particular, I’m well aware that it’s not possible to manufacture anthrax (or, to be scientifically precise, the Bacillus anthracis bacterium) in one’s home. But there’s no reason to believe such things won’t eventually be possible.

The 3-D Printed Future and its Enemies

October 9th, 2012  |  Published in anti-Star Trek, Political Economy

@makerbot store

Lately, it seems like everyone is talking about 3-D printers. Until recently, these devices have been seen either as novelties or as expensive pieces of equipment suited only for industrial use. Now, however, they are quickly becoming affordable to individuals, and capable of producing a wider range of practical items. Just as the computer became a vector for pervasive file-sharing as soon as cheap PCs and internet connections were widespread, we may soon find ourselves living in a world where cheap 3-D printers allow the dissemination of designs for physical objects through the Internet.

The line between science fiction and reality is moving rapidly. Scroll through these links at BoingBoing and you’ll see 3-D printers churning out everything from guitars to dolls to keys to a prosthetic beak for a bald eagle.

Ensconced in the home, the 3-D printer is a step toward the replicator: a machine that can instantly produce any object with no input of human labor. Technologies like this are central to the vision of a post-scarcity society that I outlined in “Four Futures”. It’s a future that could be glorious or terrible, depending on the outcome of the coming political struggles over the adoption of these new technologies. As the title of a report from Public Knowledge puts it, “It will be awesome if they don’t screw it up.”

Battles over 3-D printing will be fought on two fronts, and two mechanisms of power are likely to be mobilized by the rentier elites who are threatened by these technologies: intellectual property law and the war on terror.


I wrote earlier this year (at Jacobin, the New Inquiry, and Al Jazeera), about the fight over laws like the Stop Online Piracy Act, which would have given the state broad and ambiguous powers to monitor and persecute alleged copyright infringers. The intellectual property lobby is currently in retreat on this front, but the general problem of intellectual property stifling progress has not abated. Aaron Swartz, who was the victim of one of the more ludicrous recent piracy busts, is still facing multiple felony counts. Apple and Google, meanwhile, now spend more money on patent purchases and lawsuits than they do on research and development. And the next front in the war over IP is likely to center on 3-D printing.

Like the computer, the 3-D printer is a tool that can rapidly dis-intermediate a production process. Computers allowed people to turn a downloaded digital file into music or movies playing in their home, without the intermediary steps of manufacturing CDs or DVDs and distributing them to record stores. Likewise, a 3-D printer could allow you to turn a digital blueprint (such as a CAD file) into an object, without the intermediate step of manufacturing the object in a factory and shipping it to a store or warehouse. While 3-D printers aren’t going to suddenly make all of large-scale industrial capitalism obsolete, they will surely have some very disruptive effects.

The people who were affected by the previous stage of the file-sharing explosion were cultural producers (like musicians) who create new works, and the middlemen (like record companies) who made money selling physical copies of those works. These two groups have interests that are aligned at first, but are ultimately quite different. Creators find their traditional sources of income undermined, and thus face the choice of allying with the middlemen to shore up the existing regime, or else attempting to forge alternative ways of paying the people who create culture and information. But while the creators remain necessary, a lot of the middlemen are being made functionally obsolete. Their only hope is to maintain artificial monopolies through the draconian enforcement of intellectual property, and to win public support by presenting themselves as the defenders of deserving artists and creators.

This same dynamic will arise with 3D printing. Now, however, it is industrial designers who will be cast into the role of the artists and writers, while certain industrial manufacturers will be threatened with death by dis-intermediation. Designers will still be needed to create the patterns that are then fed into 3D printers, while the factories will be superfluous. Imagine a world in which you could download the blueprints for an iPhone 5, and print one out at home. Suddenly, Foxconn and the Apple Store are out of the picture—the only indispensable part of the Apple infrastructure is industrial designers like Jonny Ive, who are responsible for the putting together the sleek and attractive design of the device. The Public Knowledge report cited above predicts that “as 3D printing makes it possible to recreate physical objects, manufacturers and designers of such objects will increasingly demand ‘copyright’ protection for their functional objects.”

In the last issue of Jacobin, Colin McSwiggen admonished designers to pay attention to the fact that they “make alienated labor possible”. The idea of “design” as separate from production is tied to the rise of large scale capitalist manufacturing, when skilled craftspeople were replaced with factory workers repetitively churning out copies from an original pattern. But the order McSwiggen critiques is one which will be undermined by the dissemination of micro-fabrication technology.

3-D printing isn’t going to restore the old craft order, in which design and production are united in a single individual or workshop. What it will do instead is make some designers more like musicians, struggling to figure out how to react to consumers who are trading, remixing, and printing their creations all over the place. At the same time, it will blur the line between creation, production, and consumption, as amateurs delve into creating and repurposing design. Like musicians, professional designers will have to decide whether to scold their customers and join industrial interests in fighting for strong copyright protections on designs, or whether to look for new ways of getting paid and new ways of connecting with their fans.


The dark side of being able to print any physical object is that other people can print any physical object. It’s all well and good when people are just making clothes or auto parts, but recently there have been stories about more unsettling possibilities, like 3-D printed guns. The first of these was ultimately over-hyped, but did show that the day was at least approaching when home-printed firearms would be a reality. Then, there came a story about a 3-D printer company revoking its lease and demanding its device back after it got wind of a collective that intended to make and test a 3-D printed weapon.

This story is significant because it indicates a line of attack that will be used to restrict access to 3-D printing technologies in general. I have no particular love for the gun-enthusiast crowd. Those leftists who think access to guns is somehow useful to revolutionaries are living in the past and underestimate the physical power of the modern state, and having your own gun is more likely to lead to you getting shot with it than anything else. But guns, and other dangerous objects, will surely be used as the pretext for a much wider crackdown on the free circulation of designs and 3-D printing technology.

When the copyright cartels were still only trying to control the circulation of immaterial goods like music and software, they faced the problem that it was hard to convince people that file sharing was really hurting anyone. Notwithstanding a few lame attempts to link piracy to terrorism, the best they could do was point to the potential loss of income for some artists, and the possibility that there would be less creative work at some point in the future. These same arguments will no doubt be rolled out again, but they will be much more powerful when linked to fearmongering about DIY-printed machine guns and anthrax.

This is where the intensification of the surveillance state, throughout the Bush and Obama administrations and under the rubric of the “war on terror”, becomes important. The post-9/11 security state has gradually rendered itself permanent and disconnected itself from its original justification. We will be told that our purchases and downloads must all be monitored in order to prevent evildoers from printing arsenals in their living rooms, and it will just so happen that this same authoritarian apparatus will be used to enforce copyright claims as well. Meanwhile, the military will of course proceed to use the new technologies to facilitate their pointless wars. Readers who are interested in a preview of this dystopia of outlaw fabricators trying to outrun the police are referred to Charles Stross’s novel, Rule 34.

There really are dangers in the strange new world of 3-D printing. I’m as uneasy as anyone would be about unbalanced loners printing anthrax in their bedrooms. But we have seen all too well that the repressive state apparatus that promises to keep us safe from terror mostly manages to roll up a bunch of inept patsies while remaining unable or unwilling to stop a deranged massacre from going down now and then.

Terrorism, like drugs before it, is only a pretext for ratcheting up a repressive apparatus that will be used for other purposes. Today, we are familiar with the statistics showing that terrorism has killed 32 Americans per year since 9/11, while gun violence has killed 30,000. Soon enough we will be able to add 3-D printers to the list of phantom menaces that are trotted out to justify wiretaps, raids, and indefinite detentions.


William Gibson famously said that the future is already here, it’s just unevenly distributed. In the future, expect the copyright cartels and the national security state to team up to bring you a new announcement: the future is here, but you’re not allowed to have it.

First you get the money, then you get the power

October 1st, 2012  |  Published in Political Economy, Politics

Update, 2 October 2012: Corrected a mistake in the data on the charitable contributions tax deduction. An earlier version referred to the wrong table from the Tax Policy Center.

The American plutocracy’s habit of portraying itself as an oppressed minority has become a source of ongoing amusement, and Chrystia Freeland has the latest chapter of this comedy in the New Yorker. She presents a series of quotations and anecdotes that will be barf-inducing to anyone who hasn’t had their head pickled in Ayn Rand aphorisms. I particularly enjoyed the guy who compared Barack Obama’s treatment of the rich to the oppression of black Americans, and the guy who compared Wall Street supporters of the President to battered wives.

But the most illuminating and distinctive part of the essay is the way it highlights this curious argument about the “self-taxation” of the rich:

Many billionaires have come to view charity as privatized taxation, paid at a level they determine, and to organizations they choose. “All things being equal, you’d rather have control of the money than the government,” Cooperman said. “Even if you’re giving it away, you’d rather give it away the way you want to give it away rather than the way the government gives it away.” Cooperman and his wife focus their giving on Jewish issues, education, and their local community in New Jersey, and he is also setting up a foundation that will allow his children and grandchildren to support their own chosen causes after he dies.

Foster Friess, a retired mutual-fund investor from Wyoming who was the backer of the main Super pac supporting the Republican primary candidate Rick Santorum, expounded on this view in a video interview in February. “People don’t realize how wealthy people self-tax,” he said. “If you have a certain cause, an art museum or a symphony, and you want to support it, it would be nice if you had the choice.”

It would, indeed, be nice if you had the choice. Obviously charitable donation is only equivalent to tax-funded government spending if you are indifferent to democratic accountability. So it’s not surprising to hear this kind of rhetoric out of the ultra-rich, who tend to be committed to an ideology of meritocracy that is fundamentally hostile to democracy. The less cautious apologists, like Bryan Caplan, will straightforwardly propose “relying less on democracy and more on private choice and free markets.” Left unsaid is that “choice” in the private market consists mostly of the choices of the people with the most money.

This is why a class compromise over the welfare state is so elusive. It doesn’t matter whether the rich agree that they benefited from their society in the “you didn’t build that” sense, nor does it matter whether higher taxes on the rich and more spending on social programs and jobs will ultimately promote more economic growth. This is about power. Even those who piously declare their desire to “give back” to society insist on doing so only on their own terms.

Traditionally, the socialist movement has emphasized the need to subject the investment decisions of capitalists to democratic accountability, but it’s just as important to talk about democratic control over social welfare spending. The choice we face is not really whether there will be a social safety net, the struggle is over whether we will have a democratic welfare state or a kind of private welfare state run according to the whims of rich philanthropists. The latter, even in the improbable event that it could replace public spending in terms of overall dollars, would be both undesirable as a matter of democratic principle, and a lot less likely to consist of the kind of universal, unconditional income support that is most consistent with individual freedom.

A more specific policy point about this issue of “self-taxing” is that it highlights what an obscenity the tax deduction for charitable donations is. The Joint Committee On Taxation reports that this deduction (including both individual and corporate donations) cost the federal government $41.3 billion in 2012, and the cost is projected to rise to $54.7 billion by 2015. Data from the Tax Policy Center shows that over 95 percent of this benefit goes to the to 40 percent of the income distribution, and over a third of it goes to the top 1 percent. This data also shows that repealing the deduction would be equivalent to a 0.5 percent tax rate increase on the top 20 percent, and a 1 percent rate hike on the ultra-rich top 0.1 percent.

It’s bad enough that this deduction encourages the transfer of social welfare functions from the state to the unaccountable non-profit sector. But a lot of “charitable” spending is of questionable social value anyway. Leon Cooperman, described in Friedland’s article as the “pope” of the whiny billionaire movement, recently gave $25 million to the Columbia Business School, which means that the government is subsidizing his efforts to help the reproduction of the capitalist managerial class. The Bill and Melinda Gates foundation, one of the largest charitable foundations in the country, is a major promoter of the neoliberal “education reform” movement that played a major role in the battle between Rahm Emanuel and the Chicago Teachers Union. And large chunks of charitable donations (including Mitt Romney’s) go to churches, which are more important as conservative ideological and political actors than they are as sources of aid.

Leon Cooperman is both a signatory to the Warren Buffett/Bill Gates “Giving Pledge”, which commits him to giving the majority of his assets to philanthropic causes, and a passionate supporter of Mitt Romney. There is no contradiction there. Cooperman and Romney are both committed to the same principle: there’s nothing wrong with helping the needy, as long as only rich people have the right to decide when, whether, and how it gets done.

You can look at people like Gates and Cooperman as the alternative to the decaying, narrowly rapacious capitalist class I described in this post. They aren’t altruists or class traitors, they’re just demonstrating their enlightened self interest as a ruling class, and a recognition that they need to dedicate some resources to collective projects that help perpetuate the society they dominate. But they’re still the class enemy, and they’ll remind you of that as soon as their power is seriously threatened.