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Market Fundamentalism

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Point of view is everything these days.  We used to call it ideology, but that word has been swiftboated nearly out of public use by various groups operating under the pretense that their core philosophy was righteous and not really an ideology.  Ideology is political philosophy.  Liberalism is, of course, an ideology because it is a relatively coherent structure of premises and guides to political action.  Conservatism is a more general notion based on caution and fear, and in the United States it has been associated with politics and become the ideology of "federalism," (more properly "federationism,") that is, an emphasis on the states of the Union and the private sector rather than the Union as a whole.  Liberalism sees the need to protect individuals and their liberties by exercising central, consistent rule of law. The American political parties are loose associations of various points of view and particularly economic interests.  Democrats are more likely to be in favor of the central government taking the initiative to solve certain kinds of social and economic problems on the principle of an "economy of scale" or to achieve a semblance of uniformity, as with civil rights.  Whereas Republicans normally promote the idea that the central government should either stay out of the way, or (since the Civil War) that it should ease the way for private enterprise to do what it can to ameliorate the problems of society, principally by providing employment and occasional philanthropy.  Standing somewhere between these two parties is the Libertarian coalition, a group that inherits most of its basic ideas from the Conservative camp, but which being chagrined by the new religious and radical  imperial wings of the Republican Party have begun to nuzzle up to unsuspecting Democrats.

Libertarianism is the classical laissez faire doctrine of virtually total decentralization and non-interference in private enterprise, but it is based not on the belief of Conservatives that central governments politically oppress individual rights and enterprise, but on an entirely different kind of  notion that a national economy or even a world economy plays out in something called The Market, an intangible construct of "everything that happens in commerce."  The Market is, in fact an intangible; it is a collective abstraction (a reification) of a process that takes place between buyers and sellers and in the context and in terms of currency, debt, and other intermediary monetary and financial processes.

One of the best expressions of Libertarian ideology is the concept called Market Fundamentalism, which in the words of Ruth Rosen is

... the exaggerated and quite irrational belief in the ability of markets to solve all problems, an economic fundamentalism that has dominated our national political debate for a generation.
Ms. Rosen has been featured recently at CommonDreams and other websites such as the progressive thinktank Longview Institute's website where Market Fundamentalism is discussed.

Since 1776 and Adam Smith, people have been intrigued with the idea of "the hidden hand of the marketplace."  The Hidden Hand is discernible only by what it produces, that is, at some point after a period of operation one can discern that the marketplace has produced higher prices or lower prices, more products and services for sale, or fewer, employment or unemployment, slums and and ghettos for workers, estates and compounds for the rich, cell phones, computers, triple-meat Whoppers and SUVs.  It is a deliberate trick of language that calls these effects the work of the Hidden Hand, but it is really nothing more than an anthropomorphic  metaphor, a way of "humanizing" processes that simply produce a history of processes, evolving, changing, or remaining static depending on the inputs.

You will see quickly that there is really no significant role for the Hidden Hand when disasters strike.  Hurricane Katrina's devastation of New Orleans and other parts of the Gulf Coast is not-so-mute testimony of the inability of private enterprise to work outside the soft comfortable nest that central government provides by maintaining stable monetary and fiscal policies.  Please note here that the cradle of private enterprise beyond simple barter is always a government regulated monetary policy and usually a function of government fiscal responsibility.  Market Fundamentalists seem to ignore this basic truth, but they ignore it so that behind the scenes they can put their Hidden Hand up the back of elected government officials and attempt to manipulate government through them.  Whatever Libertarians may say, their highest aspiration is to control government, government hand-outs and contracts, and government protection for private enterprise at home and abroad.

There is no leading role for the Hidden Hand in combatting global warming (or any other pollution-derived climate change) for the awful truth of the Hidden Hand is that corporations live by exploiting people and the environment.  Corporations typically will run onward recklessly until bankrupt before any corrections are made.  Corrections like bankrupcy, by the way, are functions of central government controls.

The Hidden Hand gives up when it runs out of profits.  The Hidden Hand does not help the helpless or the infirm, the victims of epidemics, the victims of race prejudice, the victims of criminal conspiracies to defraud workers of their pensions.  The Hidden Hand did not place men on the moon or the Hubble telescope into orbit.  The Hidden Hand did not create the GI Bill or the vast and enviable structure of public higher education in our country.  The Hidden Hand does not cure cancer, Alzheimers disease, or autism or AIDS, for these are not profitable diseases.  The Hidden Hand does not care.  The Hidden Hand produces fast food, gas-guzzling automobiles, atmospheric pollution, destruction of natural habitat, consumerism, drug-cultures, poverty, and world-wide conflicts for markets and resources.  The Hidden Hand is all too apparent in the middle east.

Market Fundamentalism is premised on the notion that CEOs and their staffs in all the world's corporations are basically good, honest, caring  people whose daily exercise of corporate strategy, which is to produce profits to be distributed to the stockholders, will add something to this basic need for profits, that is, corporations will in the long run produce desirable effects because CEOs and their staffs are part of the civilization and would not be likely to soil their own nest.

The ugly fact, though, is that the premise is false on several counts.  CEOs are not necessarily basically good people.  They are very ambitious people, self-serving, calculating, often cynical, manipulators of the work of others.  They believe themselves to be better than just "good" because they have become rich, a state of grace some of them attribute to God's pleasure with them, while others of their number attribute their economic successes to the "natural stratification" of humanity into smartest, smarter, average, below average, and the least capable elements of society.  They, in their corporate aeries, no more and no longer believe in the equality of people before the law, because they do not believe in the any form of equality.  They are narrowly-focused elitists, some born to their special wealth and some acquiring it by steady ambition, sometimes ruthlessly, always at the expense of someone else.

Moreover, even if CEOs and their staffs were "good" people, there is very little in the corporate imperative that moves these people to do things that are intrinsically unprofitable. Profit is the be-all and end-all of Market Fundamentalism.  Yet, there are religions and philosophies at every corner of the planet that speak not of profitability, but of cooperation, compassion, forgiveness, understanding, succor, agape, and respect for the life of one's fellow man.

What then is profit actually?  It is the management of a production system so that the costs of production are made to be less than the selling price.  The cost of labor is where profiteers most often exploit the system. Human life itself is meaningless in terms of profit, for profit is the extraction of labor somewhere below value.

The so-called Hidden Hand moves because of profit and does not move when there is no profit to be made.  Market Fundamentalism is a clever hoax, nothing but a metaphor, and a wholly erroneous notion that profit-seeking not only can but inevitably will produce humane behavior.

Libertarianism rests entirely upon Market Fundamentalism—Market Fundamentalism is its basic premise.  But Market Fundamentalism has affinities for some other ideas as we have alluded to above.  Market Fundamentalism is inevitably united to corporatism, the idea that the corporation represents the positive and productive forces in life.  We already know that when corporations become the major player in a society, the polical system is called Corporatism (or more popularly, Fascism).  Market Fundamentalism is, as we have seen, inherently anti-democratic, for it rests on the premise that people are inherently unequal ... and therefore inherently some less deserving of humane treatment than others.  Market Fundamentalism ultimately commodifies human beings and reduces each person to a transaction within the The Market, a hire, a fire, a promotion, a layoff, a new definition of the person in terms of "economics," but totally and irretrievably ignorant of the intrinsic worth of that person, his hopes, her promise, their plans and dreams.

JB

 

James R. Brett, Ph.D. taught Russian History before (and during) long stint as an academic administrator in faculty research administration. His academic interests are the modern period of Russian History since Peter the Great, Chinese History, (more...)
 

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Market fundamentalism is actually a religion of a ... by Mark Sashine on Friday, Feb 2, 2007 at 1:22:42 PM
I am always amused at those on the right who still... by Halo on Sunday, Feb 4, 2007 at 2:09:15 PM