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Economic Development and the Death of the Free Market
Get PDFAccording to neoclassical economics, the most efficient way to organize human activity is to use the free market. By stoking self interest, the theory claims, individuals can benefit society. This idea, however, conflicts with the evolutionary theory of multilevel selection, which proposes that rather than stoke individual self interest, successful groups must suppress it. Which theory better describes how human societies develop? I seek to answer this question by studying the opposite of the market: namely hierarchy. I find evidence that as human societies develop, they turn increasingly to hierarchical organization. Yet they do so, paradoxically, at the same time that the language of free markets becomes more common, and culture becomes more individualistic. This evidence, I argue, contradicts free-market theory, but only if we treat it as a scientific doctrine. If instead we treat free-market theory as an ideology, the pieces come together. Free-market thinking, I speculate, may stoke the formation of hierarchy by cloaking power in the language of ‘freedom’
Dominant Capital and the Government
No full textThis note contextualizes the ongoing U.S. policy shift toward greater ‘regulation’ of large corporations. Cory Doctorow and Blair Fix are optimistic about this shift. We doubt it
Red Giant
No full textIn 2012, we published a paper in the Journal of Critical Globalization Studies titled ‘Imperialism and Financialism: The Story of a Nexus’. Our topic was the chameleon-like Marxist notion of imperialism and how its different theories related to finance. Here is the article’s summary:
Over the past century, the nexus of imperialism and financialism has become a major axis of Marxist theory and praxis. Many Marxists consider this nexus to be a prime cause of our worldly ills, but the historical role they ascribe to it has changed dramatically over time. The key change concerns the nature and direction of surplus and liquidity flows. The first incarnation of the nexus, articulated at the turn of the twentieth century, explained the imperialist scramble for colonies to which finance capital could export its excessive surplus. The next version posited a neo-imperial world of monopoly capitalism where the core's surplus is absorbed domestically, sucked into a black hole of military spending and financial intermediation. The third script postulated a World System where surplus is imported from the dependent periphery into the financial core. And the most recent edition explains the hollowing out of the U.S. core, a red giant that has already burned much of its own productive fuel and is now trying to financialize the rest of the world in order to use the system's external liquidity. The paper outlines this chameleon-like transformation, assesses what is left of the nexus and asks whether it is worth keeping. (p. 42)
In the second part of the paper, we looked a little closer at the red-giant argument. Specifically, we wanted to gauge the degree to which U.S. capital had declined and examine whether this decline indeed forced the rest of the world to financialize. And what we found surprised us: the ‘financial sector’ did seem to become more important everywhere, but its rise was led not by the United States, but by the rest of the world!
Our article was published almost a decade ago, so we though it would be interesting to update our figures and see what has changed, if anything
Book Review: Capital as Power
Get PDFFROM THE REVIEW:
You see, I’m trying to give you a picture of what it is like to read this book, and the experience of having a tantalizing insight dangled in front of you but then being forced to read far more history and statistics than you would really like to understand it is essentially all of Capital as Power.
Capital as Power is long, but extremely full of content [...] Bichler and Nitzan write in a very engaging way; not necessarily easy to read but certainly action-packed. And there are many, many interesting historical nuggets in the book, like the history of GM’s EV1 car.
[U]nlike the laws of economics which mostly claim to be universal across time, the strength of Capital as Power is that they can identify what things are true about some periods, and not of others, and integrate these assumptions into their models. In other words, rather than being a general theory of economics, Capital as Power is a general theory of the space of possible capitalist politics, or as Bichler and Nitzan seem to be so happy to coin, a general theory of possible capitalist creorders
Once More Into the Fire of Academia
No full textSome exciting personal news. In July, I will be starting a postdoctoral fellowship at York University. I’ll be studying the hierarchical origins of income inequality [. . .] The basic idea of my research is that there is a disconnect between our working lives and how political economists understand the distribution of income. In our working lives, we have jobs within hierarchies and get paid according to our status. Everyone knows that’s how it works … at least implicitly. But when political economists model the resulting distribution of income, they somehow forget about these hierarchies. Odd, right? I’m trying to build a theory of income distribution that doesn’t forget about the hierarchical facts of life. Stay tuned for the interesting results to come
Growing through Sabotage: Energizing Hierarchical Power
Get PDFAccording to the theory of capital as power, capitalism, like any other mode of power, is born through sabotage and lives in chains – and yet everywhere we look we see it grow and expand. What explains this apparent puzzle of ‘growth in the midst of sabotage’? The answer, we argue, begins with the very meaning of ‘growth’. Whereas conventional political economy equates growth with a rising standard of living, we posit that much of this growth has nothing to do with livelihood as such: it represents not the improvement of wellbeing, but the expansion of sabotage itself. Building on this premise, the article historicizes, theorizes and models the relationship between changes in hierarchical power and sabotage on the one hand and the growth of energy capture on the other. It claims that hierarchical power is sought for its own sake; that building and sustaining this power demands strategic sabotage; and that sabotage absorbs a significant proportion of the energy captured by society. From this standpoint, capitalism grows, at least in part, not despite but because of – and indeed through – sabotage
Unflat Ontology: Essay on the Poverty of Democratic Materialism
Get PDFThe paper is dedicated to the problem of flat ontology in philosophy and its relation to the practice in economy. The author argues that flat economy is based on a marginal utility theory of value and presents hierarchical value chains with concentration of power-capital as if they were flat and all the actors involved were equal. This is the work of democratic materialism, with its idea of radical equality of human and non-human interactions. This perspective, according to the author, should be opposed by the reconstruction of power-capital relations in unflat ontologies of the value-creation process
How the Rich are Different: Hierarchical Power as the Basis of Income Size and Class
Get PDFThis paper investigates a new approach to understanding personal and functional income distribution. I propose that hierarchical power—the command of subordinates in a hierarchy—is what distinguishes the rich from the poor and capitalists from workers. Specifically, I hypothesize that individual income increases with hierarchical power, as does the share of individual income earned from capitalist sources. I test this idea using evidence from US CEOs, as well as a numerical model that extrapolates the CEO data. The results indicate that income tends to increase with hierarchical power, as does the capitalist composition of income. This suggests that hierarchical power may be a determinant of both personal and functional income
Power and Capital
Get PDFFROM THE ARTICLE: I have always operated as if, since the originary hypothesis founds a new form of thinking that is essentially indigestible by the existing disciplines, and therefore necessarily at odds with those disciplines, it should be aligned with other marginal indigestibles in the field of knowledge. Hence, my attraction to thinkers like Wierzbicka who, if respected within the field of linguistics, does not seem to me to have had much impact on it; or Marcel Jousse, who takes the notion of mimesis too literally and thoroughly even for the mimetic theorists. Clearly, Jonathan Nitzan and Shimshon Bichler, of whose Capital as Power: A Study of Order and Creorder I was previously aware, but which I actually sat down to read at the urging of Joel Davis, fits into this category. So, this post will “welcome” Nitzan and Bichler (perhaps without their consent, were they to be asked) into the anthropomorphics “fold,” and I would expect them to be a regular feature from here on in. Like Wierzbicka and Jousse and, of course, the originary hypothesis itself, Nitzan and Bichler have a very simple hypothesis with ramifications that cut down forests of disciplinary obfuscation. I don’t remember when or how I first came across their work, because I’m pretty sure it wasn’t from any website or publication, whether on the left or right, since as far as I can tell Capital as Power has had almost no impact on any discussions anywhere. If I were to try and prove myself wrong on this point, I would look to the kind of anarchist spaces where one might find discussions of the work of the recently and far too soon departed David Graeber, with whose work (and, I suspect, with whose politics) Nitzan’s and Bichler’s has affinities
Global Capital: Political Economy of Capitalist Power (YorkU, GS/POLS 6285 3.0, Graduate, Fall Term, 2020-21)
Get PDFWhat is capital? Despite centuries of debate, there is no clear answer to this question – and for a good reason. Capital is a polemic term. The way we define it attests our theoretical biases, ideological disposition, view of politics, class consciousness, social position, and more.
Is capital the same as machines, or is it merely a financial asset? Is it a material article or a social process? Is it a static substance or a dynamic entity? The form of capital, its existence as monetary wealth, is hardly in doubt. The problem is with the content, the stuff that makes capital grow – and on this issue there is no agreement whatsoever. For example, does capital accumulate because it is productive, or due to the exploitation of workers? Does capital expand from within capitalism, or does it need non-capitalist institutions like the state and other external forces? Is accumulation synonymous with economic growth, or can capital expand by damaging production and undermining efficiency? What exactly is being accumulated? Does the value of capital represent utility, abstract labour – or perhaps something totally different, such as power or force? What units should we use to measure its accumulation?
Surprisingly, these questions remain unanswered; in fact, with the victory of liberalism, most of them are no longer being asked. However, the silence is incomplete. As crisis and social strife intensify, the questions resurface. The accumulation of capital is the central process of capitalism, and unless we can clarify what that process means, we remain unable to understand our world, let alone change it.
The seminar has two related goals: substantive and pedagogical. The substantive purpose is to tackle the question of capital head on. The course explores a spectrum of liberal and Marxist theories, ideologies and dogmas – as well as a radical alternative to these views. The argument is developed theoretically, historically and empirically. The first part of the seminar provides a critical overview of political economy, examining its historical emergence, triumph and eventual demise. The second part deals with the two ‘materialistic’ schools of capital – the liberal theory of utility and the Marxist theory of labour time – dissecting their structure, strengths and limitations. The third part brings power back in: it analyses the relation between accumulation and sabotage, studies the institutions of the corporation and the state and introduces a new framework – the capitalist mode of power. The fourth and final part offers an alternative approach – the theory of capital as power (or CasP for short) – and illustrates how this approach can shed light on conflict-ridden processes such as corporate merger, stagflation, imperialism and the new wars of the late twentieth and early twenty-first centuries.
Pedagogically, the seminar seeks to prepare students toward conducting their own independent re-search. Students are introduced to various electronic data sources, instructed in different methods of analysis and tutored in developing their empirical research skills. As the seminar progresses, these skills are used both to assess various theories and to develop the students’ own theoretical/empirical research projects