the full and free development of the personality: a byway

… for the subject of sleep is not the eye, but the common sense, which once asleep, all eyes must be at rest. – Sir Thomas Browne

Philoppovich not only has a sense, as an economist, of the intellectual structure of liberalism, but – and this is rare among economists – a sensibility attuned to the discontent liberalism produces. His survey of the triumph of the policy of free trade, with the ‘consumer’ as the fulcrum of society, does not stop there. He understands why one might question a picture of society that made it simply a vast tangle of transactions between buyers and sellers (even if he did not question the idea that, indeed, economic life had turned into a vast tangle of such exchanges, instead of – as Mauss would suggest – a richer tangle of different forms of exchange – and he understands inequality. Thus, after showing the success of liberal economics, he shows the unexpected result of the creating of vast enterprises and labor markets composed of increasingly de-skilled or monoskilled laborers. Thus, Philoppovich ends his chapter on liberalism on a note of uncertainty:

“ Economic individualism (liberalism) has not only effected changes in external living conditions,  but also changes in life’s ideals, for today more than ever our existence is oriented to the order of its material basis. But does, therefore, the idea of the liberal economic system remain unchanged, when society achieves the best order, that being the unhindered pursuit of their interest by individuals?  Experience teaches us that this is not the case, that other ideas of the state and society become strong, that with the growth of the political power of liberalism grow other interests out of the discarded one and out of newly created interests.”

He proceeds to examine the conservative reaction to the dissolution of what, since Burke, had been called the natural order, and to the socialist reaction that arose as a matter of class interest.

“The exploitation of the worker, that is, the ruthless utilization of his labor power became, through this economic system, an objective necessity. This fact, however, came into contradiction with the two principles, which liberalism itself had pronounced, with the principle, that in the whole domain of life commodities, labor was the producer, the creator, as Smith taught and after him the national economists, and with the principle, that with liberalism from its birth on had struggled for against the privileged, that all men are by nature equal. In the sentiment of this contradiction of their actual situation with the principle of the free and equal personality, which should be recognized in all men, the laborers united, however much they may have differed in their conception of the state, of society, and of life itself.” [53]

Philippovich distinguishes the socialists from the romantics in the former’s resolute farewell to the society of the natural order, of small artisans, of a middle class of independent worker-owners. Indeed, it was only the giant capitalist concerns that could create and disseminate the productive power of innovative technologies; as Fourier pointed out in the 1840s, however, the disjunction between social wealth, which capitalism enormously increased, and the enjoyment of that wealth, which was subject to severe and punishing inequality, called for remedies that would enable all to enjoy the wealth and all to enjoy, as well, more leisure.  Philippovich is sharp eyed enough to see that in the latter, we get to the key of the socialist motivation and its own nostalgia, its own connection to the conservatives.

In this view  the goal that is served by  abolishing private property and transforming it into social property we recognize the ideal of socialism. It is the highest development of the individual personality, which the economy subordinates as a mere means. Today, on the contrary, the higher goal of life is lost in the subordination of all interests to the material goals of the economy, in which art and science itself only serve production.” It is here that Philippovich’s sense of the socialist movement encompasses not only Marx, but Oscar Wilde – which perhaps takes fin de siecle Vienna, the city of the “gay apocalypse”, to see clearly. “To gain for all men the world of spiritual freedom, of beauty, of research, of aesthetic enjoyment , to create for them the opportunity of enjoying their existence through the unfolding of their personal spiritual talents and forces, that is the ideal that hovers before  socialism. It is the last consequence of the recognition of the leveling [gleichwertigkeit] of the human personality.”

The socialist ideal, then, is an existential ideal, which views the economic order as a means, not an end. The idea that the economic order has become an existential end, in modernity, survives in Karl Polanyi’s work, where it is redefined in terms of embedding: the ideal of the capitalist economic order is to embed the social entirely in the economic. By a paradoxical twist, a form of Marxism – associated, now, with Stalin – took up the ideal of the liberal economic order – at least as read by the 19^th century socialists – and transposed it from an analysis of capitalism by way of its system of production into a social ideal in which all things exist for social production, thus effectively shutting down, as bourgeois crap, the whole discourse of the full development of the person.

A vienna pink: Eugen Philippovich

In Timm’s biography of Karl Kraus, the most uncompromisingly shaved prophet in history, there is the following reflection about the political meaning of beards: “In the Vienna of 1848 the student revolutionaries had worn beards, which became symbols of their political fervour. And after the defeat of the revolution, it is reported that the authorities forcibly shaved them off. By the 1880s, those students had become pillar of the Austrian establishment. Their beards, now grey and venerable, symbolized for the iconoclasts of Kraus’ generation a pompous Victorianism that had to be swept away. A study of Wittgenstein puts the matter very clearly: “The rebellious young men who were seeking to achieve consistensy and integrity rejected facial hair along with all bourgeois superfluities. To them, moustaches and sideburns were mere ostentation, like velvet smoking jackets and fancy neckties.”

By these standards, Eugen von Philippovich, who taught economics at the University of Vienna in 1900, was on the side of the fathers. His photographs show a man as bearded as General Grant. Unlike Grant, however, his beard seems kempt, and his fashion style seems, even, modern.  A photograph of him from 1910, put on line by the Austrian National library, describes him as follows: “Eugen Philippovich Freiherr von Philippsberg in a Jacket with a single row of buttons, a vest with a single row of buttons, striped pants and a white shirt with a folded collar and tie, with a Filz Trilby hat with a silk bank, a full beard and glasses.” Like Freud, whose fashion sense he shares, he is a man between the world that was formed after the failed 1848 revolution and the world being formed by the fast pace of techno-cultural and political changes at the turn of the century in Vienna. He is of the liberal generation that learned its economics from Carl Menger (von Philippovich literally did) and its duties from Kant (like  Ulrich’s father in  Robert Musil’s Man Without Qualities).

Philippovich is not adduced to today – but he did write an adducable book in the year that the photo was taken of him entitled “The development of economic-political ideas in the 19^th century.”  Perhaps economic-political, today, would be translated ideas of economic policy. The book’s melody is simple: it starts from the fact that the dominant economic tendency  of the first part of the 19^th century, in Europe, was “economic liberalism” – the overthrow of ancient impediments to free trade in domestic and world markets – while the economic tendencies of the second half of the nineteenth century were in reaction to liberalism – on the one hand, the conservative defense of an “organic order” that preserved aristocratic privilege, and on the other hand a socialist attack on behalf of the working class.

One might think, considering the tie between the contemporary image of “Austrian” economics and the hardcore advocacy of untrammeled capitalism, that Philoppovich would view the liberal dominance as the golden age and the attacks as the downfall of a beautiful idea. But Austrian economics in Austria, at this time, were not as simple as a latter generation of ideologues – notably Hayek and Mises – made it out to be. In fact, Philippovich was the center of the Austrian Fabians, who, like their English counterparts, wanted to use the power of the state to make a number of socialistic reforms in the economic arrangement of things in the Habsburg Empire. Philippovich, for instance, investigated working housing in Vienna and described the awful conditions of the tenements – inspiring the Socialist post war government’s effort to provide decent housing for the workers, according to Eva Blau’s The Architecture of Red Vienna. His work here was at the intersection of the liberal-left concerns of the Fabians and the modernity of architects like Loos, who despised the dishonesty of Vienna’s modern buildings, with their historicist facades – the borrowed ornamentation of earlier epochs – and horrid interiors.

Thus, Philippovich’s book is hard on the vices of liberalism and soft on the vices of socialism – or so it may appear to an orthodox economist.

The first chapter that describes the formation of the liberal economic policy set and its implementation takes as a sort of surveyor’s mark the phrase of the phrase of “Michel Chevalier, who in his report on the Paris World’s Fair of 1867 could write: To have helped Free trade to triumph will be one of the titles of fame given to the second half of the 19^th century.” In fact, the basis of that triumph, as Philippovich shows, is based in reforms that occurred in the first half of the 19^th century, which followed a certain theory.

“For this change in the postion of the state and the individual in the economic process of society the economic theory of liberalism delivered a foundation that was, in its simplicity, clarity and inner certainty extraordinarily captivating, understandable and through life experiences easily tested. When everyone can produce what he wants, and can trade with all other members of society in terms of free contracts, than the reasonable pursuit of one’s own interest must lead to the state that all economic goods will be produced in the most economic way and in regard to the need of the greatest possible munber which is allowed by the limits of the means of production at that time. Because in viewing his self interest the consumer will always be lead to the point that there will always be a demand for things which are necessary for society. The utility of society consists in the fact that the emergent needs of its members must be satisfied. This means that their enterprises must be satisfied. It will always be the case that things reflect such uses as are desired and that their producers are given occasion to sell them. These producers will be lead through their self-interest to produce these things at the lowest cost, because by complete freedom of trade the consumer will turn his custom to those that can most cheaply satisfy his demand. Where the costs are greater and thus the price required higher than the consumer’s sense of its value, the consumer will pull back. These producers will thus have to either limit their production or give it up, while others will extend it. Accordingly, the prospect of gain will invoke the striving of the producers to produce at the lowest cost. But not only will consumers and entrepreneurs with full freedom act so as to serve their interests best, but also workers will turn to those businesses, where their labor power is best recompensed, and that is naturally those in which there is the tendency to extend production, and thus in which there is a stronger social need. Accordingly, in such an economic system all will strive after his own advantage, but through this, at the same time, the socally best distribution of goods and labor power will be implemented. … Basically the whole of economic life is only a continual buying and selling. Rent, loans, pacts, in brief all contracts, in which claims to utilities are made and compensation is offered in return, were engaged in and dissolved according to the same principles.  Against this free trade the state had nothing other to do than to guard the person and property of all from violence and deceit, and to compel the fullfillment of freely entered into agreements. In the interest of political freedom and on economic grounds, the state must avoid a positively public activity, or business affairs. If the government engages in such enterprises it will expand its power and influence by controlling a great number of places and can comand and injure the many interests of private parties and can use them for political ends. Economically purposive management will be obstructed by the wish of the government to curry favor with influential parts of the population: here the great land owners, there the great industrialists, no again certain regions against others, here the worker and their the small business. Or they will be forced under the influence of popular movements to make rules, which are uneconomic. Such management will also because of the difficulty of leading an economic enterprise through a  bureaucratic apparatus work less efficiently, than a private one, while the leading personnel has only a weakened interest in success, and thus the energy of labor will suffer.”

Philippovich’s summary brings out the ideological necessity behind the sovereign consumer, upon which hinges a system that both needs the coercive powers of the state and needs to keep the state from interfering, in any way, with the accumulated inequalities that result from the process of free trade. Philippovich is interested not only in these inequalities, but in the “thinness” of the idea that all of social life is encoded in buying and selling. I’ll examine these two ideas in the next post.  

the neo-liberal virus: its not just in the U.S.!

Le Monde today publishes a long thumbsucker about the sudden collapse of electoral hope in Sarkozy’s camp. It concludes with the man himself, who was recently consoled by visits from two former European presidents – Gerhard Schroeder and Felipe Gonzalez. Note, well, that these consolers were the leaders of the ‘socialist’ parties in their respective countries. That they would form the cortege of Sarkozy’s well wishers tells us a lot about European politics over the last decade – marked by the utter betrayal of the left by  the elite within the leftist parties.

I am noting this to preface my take on the recent debate between John Quiggin – a leftleaning economist – and Tyler Cowen – a rightleaning one – over what Quiggin calls “entrenched inequality.” There have been numerous papers lately that demonstrate the ossification of opportunity in the U.S. The upper class has entrenched its wealth and power, the upper middle class is stuck, the middle class is downshifting, and the poor are increasing.

Cowen has surveyed the evidence and proposed that perhaps social mobility – upward mobility for the majority, downward mobility for the wealthiest – isn’t such a great thing anyway.

As often happens, the debate plays out as one that pits the U.S. against Europe. Frankly, I find this bizarre. The neo-liberal agenda that has aggravated the plutocracy in the U.S. doesn’t stop at Bar Harbor. It has, in fact, been disseminated throughout Europe at least since the end of Thatcher’s misrule in the UK. And, as Sarkozy’s friends show, it has been disseminated not simply through rightwing parties, but through leftwing ones. In fact, by a cruel irony, rightwing parties, with their residue of nationalism, often end up opposing ‘liberalization’, and thus, de facto, protecting the social democracy put in place (however spottily) in Europe during the Cold War period.

I think the evidence – at least from the OECD - is that upward social mobility is stalling in all the developed countries. At the same time, as the OECD report for 2011 makes clear, between 1980 and 2008, every OECD country recorded the trend of the top 1 percent accruing a growing share of the total income.

Yet both Cowen and Quiggin are content to knead up this matter in the old tired mold of the U.S. versus Europe.

Cowen’s arguments echo the usual conservative rotomontade about “Europe”: for instance, the idea that in Europe, the public sector is vast and the private sector small. Here is Cowen on how smart Americans know the action is in the private sphere, while “[l]ots of smart Europeans decide to be not so ambitious, to enjoy their public goods, to work for the government, to avoid high marginal tax rates, to travel a lot, and so on. That approach makes more sense in a lot of Europe than here. ”

What could this mean?
The first thing I’d point out is public goods/private goods distinction, upon which much of his argument rests, seems to envison the government as something that consists entirely of tax collectors, while the private sector consists wholly of Apple. In fact, governments can do a lot of different work, depending on what is nationalized and what isn’t. For instance, they can nationalize trains, or the mail, and provide the same service that private trains and private mail companies provide. Profit is a functional difference, but for the people working in the institution, it doesn’t really matter.

As importantly, no developed country has a pre-1930s public workforce. In the U.S., the number of people who work for the governmenton all levels – local, state and federal is 17 percent. Now, that is less than the EU average, but significantly higher than the Japanese average of 8 percent. (see paper by J. Handler, here, and it is also a higher percentage than in Germany, the Netherlands or Italy. All of which tends to say that Cowen is using a piece of received wisdom instead of goiing to easily available sources to make his points. This is not economics, but punditry.  However, Quiggin does not parry this stroke, since he, too, seems to buy the image of Europe as the paradise of social democracy.

Another of Cowen’s arguments identifies taxation and redistribution. Now, this is not entirely erroneous.  According to the OECD report, “OECD-wide, inequality in income after taxes and transfers, as measured by the Gini

index, was about 25% lower than for income before taxes and transfers in the late 2000s, while poverty measured after taxes and transfers was 55% lower than before taxes and transfers.” However, the results depend on the tax regimes and government spending. If, for instance, the U.S. taxes and spends that tax money on the military, the redistributive effect is very low. This is where the EU is very good. According to Handler:

“According to the latest data available (2001), there are significant differences in the structure of the public sector between the EU and that in Japan and in the US. These differences are highlighted by Figure 7. The largest difference, gauged from the social protection figures, is that the EU15 redistributed roughly 12% of GDP more than the US and 8.5% more than Japan. Moreover, the EU15 is leading with regard to health expenditures whereas it spends less than half the share of GDP on defence than the US does. Finally, the US devotes slightly more public expenditures to education than the EU15 and considerably more than Japan.”

It should be noted that in two areas, the U.S. does outstandingly poorly. Its public expenditure is tremendously dedicated to healthcare, and yet it also spends more privately on healthcare – due to the enormous inefficiencies of a mostly private healthcare system. And the same is true with education, as the Government decided, long ago, to encourage private loans for college students, rather than setting up a wholly owned Government subsidiary to do the job. The result has been inflation of debt and an explosion of expenses in colleges, which are now administered by the same cadre of creeps one finds directing things in banks, private equity firms, or lobbying houses.  

That said, the EU has been far from immune to the neo-liberal virus, which is why it is threatened with massive wealth inequality and the politics that flows out of it – as anybody who looks at the austerity counter-revolution going on here can see. Developed economies really need higher levels of public employment – Germany’s is scandalously low, as is the U.S.’s – in order to produce what, at this stage of affluence, developed economies really need – more and better public goods. Choking the rich – imposing caps on income and expropriating absurd amounts of wealth – is only a tactic in the general movement that we should be seeing to a fairer system that spreads the benefits of the economic system to all. For instance, the use of the internet to set information free has shown that the information – in terms of tech and media products – will keep on flowing even if IP laws are changed to radically limit the monopoly power of IP holders. Similarly, healthcare as a public good is actually easier to do now than it has ever been, and would be cheaper if it were treated as a public good – i.e. the state simply inflating the population of healthcare workers far above its current level, throwing up clinics with the appropriate technology with abandon, etc. Instead, we are mired in the coils of a dying healthcare system that has elevated the incomes of doctors and dentists to absurd heights and taken no advantage of the advances in tech and education that would allow much of the work of the GP, for instance, to be done by an RN. And so we could go through the whole list – lower working hours, less emphasis on the money-merit connection (if you have a real talent, then it is a joy to do it in itself. Money is secondary), and in general the more humane capitalism that we are all very near, and that is being pissed away to keep our masters in yachts and single malt scotch.

on to the sovereign consumer II

In 1948, Mary Jean Bowman wrote an article concerning the rise and relative decline of the consumer in economic theory: The Consumer in the History of Economic Doctrine. Phillip Mirowski has shown that the enormous powers of control systems such as were put into operation by U.S. during World War II had left an impress on the economics profession at that time. It was an impress deepened by the merger of mathematical economics and Keynesian ideas about demand management in the Anglosphere in the years after the war. There was never, in that period, any real threat that the private enterprise system would be taken over by the state – but there was enormous confidence in the state’s ability to direct the economy. Against this background, Bowman’s history seems to be an exercise in antiquarianism. For readers who have experienced the collapse of confidence in the state’s ability to direct the economy – at least on the surface of economic thinking – and the dominance of the neo-liberal framework, it is the antiquarianism that is antiquated.

Bowman divides into four the approaches to the consumer in economics. Her third approach is closest to what would be called the idea of the sovereign consumer: “The consumer is viewed as the originative and active agent in determining the allocation of resources. .. Since the late 19^th century the normative stress has been mainly on realizing consumer preferences, but a resource allocation analysis has been applied in other normative contexts…” (1)

For Bowman, Say was “probably the first economist to become an unqualified exponent of the normative postion that the satisfaction of consumer preferences, whatever those preferences might be, was an end in and of itself.”

But in Bowman’s history,  Say was a little to early to have been able to exploit the subjective turn that came about with the marginal utility approach. Furthermore, if Say were to reach for a physics model of the economy, it would have had to have been Laplace – whereas by the late nineteenth century, better statistical tools and and models of physics gave economists a sense that mechnics could be transferred to the matter of exchange. Wicksteed, for Bowman, is the key figure in this history (which, as she admits, is skewed towards England and America):

“Wicksteed was the first of the British economists explicitly to join the utility and cost approaches through opportunity cost. The concept was applied in both the allocution of resources among different uses and the margin of choice between leisure or idleness of resources and income. In the former application consumers’ rule was carried back through the economy by imputation.”

So Bowman’s history stands as a tale of events unfolding in a particular department of knowledge. The motives, here, are generated, or so we are to believe, by the structure of science – although it is already a question of whether this is the science of discovery, or whether the experimental and the empirical are being pre-processed in a gesture of scientific aspiration. The economist’s understanding of themselves as scientists was expressed by Mill, and repeated by Carl Menger, one of the important pioneers of the marginalist school, in his Investigations (1883):

‘The will of men are lead by countless and in part contradictory motives; in this way, any strict law-likeness of human action in general and economic in particular is excluded from the beginning. Only when we think of man in his economic activity as being continually guided by the same motive, i.e. his self-utility, does the mmoment of arbitrariness appear excluded, and every action strictly determined. Only under the above presupposition is accordingly the laws of political economics and even national economics thinkable.” [My translation, 73]

The language of determination leads us into the logic of economic indvidualism, which presents itself firstly as a methodological norm. The individual’s motives may be granted free reign – but as far as the economist is concerned, they must be formally enveloped in a modality that will make them calculable and determinant.

…

Character is never the rubric under which the economist goes about his business. Rather, at the heart of the subjectivist move was an oddly vacuous subject – the ‘individual’, or the consumer.  In mainstream economics, the decisive rupture with the classical school centers on the replacement of the laborer, the producer, by the individual consumer, the preferer. But this change of focus creates an oddly dysymmetric picture of economic activity, as though individuals existed in some series, isolated from one another, the realization of their choices cut off from any interference one with the other.  continually chosing goods and services, an eternal monologue of want. One imagines them as Beckett characters, buried up to their necks in purchases, balancing costs and benefits. Far from being a choice of method, a choice of connection within a network of connections as in Simmel, a choice for salvation that leads to a new life, the choice of believing in the eternal return of the same that leads to the transcendence of the human, the choice of revolution that throws off the yoke of alienation, the choice of the economic agent has a curiously muffled, a passive aggressive nature. It is a choice of, as economists like to put it, one bundle of goods over another, with the world of supply, of production, of creation, absolutely subservient to choice.

The inversion of the economist’s protagonist – from producer to consumer – follows the logic of individualism in as much as it clears a space in which economics can be a social physics, or mechanics. The individual shoppinng is a distinct unit. The individual producing, on the other hand, is a collaborator. The steelworker does not make a fleck of steel distinct from the fleck of steel made by his fellow steelworker. The classical economists made great strides in abstracting to gain a sense of economic objects as produced, by postulating a fully substitutable abstract labor time – the time that is represented in the time card. But Marx revealed that there was an unconscious total social fact following upon this way of analysis: producers were exploited within the class stratified social whole. This would bother few in a world in which the servant/master relationship was assumed, but it did bother a world in which that relationship had to be justified. And yet, of course, in a further paradox, the first world, by depending on non-liberated labor, could never bring about the  industrial and financial system  of capitalism – capitalism must free the laborer if the laborer is to be exploited in a proper capitalist manner.

Moreover, the genesis of value, following the classical route, created insuperable problems of quantification – and could only be approximately quantified from surface indices. That this may just be the way the economy functions was not a good answer for an economics that wanted to be not simply a social science, but the most scientific social science.

Still, the turn in economics from the producer to the consumer, from labor value to marginal utility, was not received in the social sciences or among policy makers without skepticism and outright resistance. Among the paths of that resistance was: the sociology that took as its primary units certain collectives; the path of therapeutic nihilism; and the positive pather of socialism. The first took collectives to be, at least for the purposes of explanation, agents  – crowds, public opinion, class, etc. The second exploded the notion of the unified individual, with his unified consciousness, from within –a move which was variously made by William James, Nietzsche and Freud. This path eventually led, in the twentieth century, to another notion of the person in terms of sovereigny and abjection. And the third path centered upon the idea that the individual’s consciousness of himself was always mediated by class, a state of affairs that could only be changed by revolution.

the sovereign and the sovereign consumer

In 1967, Robert Solow wrote a disparaging review of John Kenneth Galbraith’s New Industrial State, which was a bestseller that year, in the Public Interest, a fairly hot academic journal at the time. In the same issue, Galbraith replied. The quarrel spilled over into the next issue in 1968, with an ideological comrade of Galbraith’s, Robert Marris, pitching in, and Solow finally counter-attacking his two adversaries.

The original review raised the doubt that Galbraith was using a scientific method, instead of an ad hoc method of magisterial observation. Solow felt that Galbraith’s themes were often invalidated by modern economic theory. And, in particular, he did not think that Galbraith could be right about one of the theses that had by that time become associated with his name: that corporate demand management, that is, marketing, shaped both production and the market.

At one point, Solow, in responding to a supporter of the Galbraith view, Marris, wrote: “What I said was: … But I should think a case could be made that much advertising serves only to cancel other advertising, and is therefore merely wasteful.” I should think it obvious that this almost has to be true – i.e., that much advertising merely cancels other advertising – for otherwise there would be nothing to stop both the cigarette industry and the detergent industry from expanding their sales to their hearts’ desire and to the limits of consumers’ capacity to carry debt.”

This was written in 1968, when the consumer’s ability to carry debt was not itself a great matter of advertising. It proved to be so in the 2000s, and as we have seen, mortgages and credit card debts did expand to the hearts’ content of banks and financial service companies – until the limit of the consumers’ ability to pay debts was reached. The ghost of Galbraith is entitled to smile about Solow’s naïve idea that debt itself can’t be commodified, advertised and amplified.  But more here is on display than  Solow’s limited imagination. There is, in Solow’s statements, a classic economist’s blindness to the relationship between goods, and indeed, people – to the novelist’s truth that people live in other people’s lives.

Thus, when Solow writes: “It must be harder to influence the consumer’s choice between purchases of cigarettes and purchases of beer, and much harder still to influence his distribution of expenditures among such broad categories as food, clothing, automobiles, housing…”, he falls into a rather puzzling trap in which the purchase of beer and cigarettes is a one time purchase with no effects on one’s lifestyle. His dissociation of goods and people make it impossible to see the connection of a good like cigarettes and a broad category like housing – a connection that came into view very clearly for the 300,000 some people who died of lung cancer in 1967. Indeed, 1967 marked the high water mark of the increase in cigarette smoking. The next year, the government and private organisations began to feature a massive anti-smoking marketing campaign. And the incidence of smoking started to fall.

Solow’s notion that advertising countered advertising is, indeed, an observation about the content of some advertising – the comparative subgenre. However, it was evident even to Solow that this couldn’t account for all advertising. Nor was he happy with the idea that advertising was simply waste, for if that were the case, the government could happily ban advertising without economic damage –and this was not something Solow’s economic ideology would allow. At the University of Chicago, a school developed that contended that advertising did, indeed, have an economic benefit, by giving consumers – whose preferences were made through the same act of freewill by which sinners in an evangelical church accept Christ as their Lord and Saviour – with information that will help them find their preferred goods and services. Since advertising doesn’t look like it is in the business of providing this kind of information, the Chicago school was reduced to saying that advertising signaled bundles of qualities – such as comfort – even if the information it gave looked more like the rhetoric of persuasion.

Why were economists so eager to dispatch Galbraith’s idea? Or I should, perhaps, say the idea of the marketers themselves – there have been many sociological studies of, say, the internal paper generated by advertisers of tobacco, and it is nothing like the Chicago Economics ideas about what advertising does. There is some support for Solow’s other notion, which is that mostly, advertising produces brand switching, but not a demand for the particular good. Yet it is unclear what this means – especially as a good like cigarettes was indeed used by more and more consumers in the years from the turn of the century up long past the medical evidence that it caused cancer. Is switching a brand ontologically different from switching to a good? And what is really being switched? What goods are really in competition?

Galbraith, in his reply to Solow, pointed out that the reason Solow attempts to dismiss him out of hand is that Solow is protecting a certain ideology, one that is shared among mainstream economists:

“The issue concerns the future of economics in general and of the highly pretigious work with which Professor Solow is associated in particular. That work is within a highly specific frame…

            What is the frame? It is that the best society is the one that best serves the economic needs of the individual. Wants are original with the individual; the more of these that are supplied, the greater the general good. Generally speaking the wants to be supplied are effectively translated by th market to firms maximizing profits therein. If firms maximize profits they respond to the market and ultimately to the sovereign choices of the consumer. Such is the fame and given its acceptance a myriad of scholarly activities can go on within it. Any number of blocks can be designed and fitted together in the knowledge that they are appropriate to – that they fit somewhere in – the larger structure. There can be differences of opinion as to what serves the larger structure. Mathematical theorists and model builders can squabble with thos who insist on empirical measurement. But this is a quarrel among friends.”

Galbraith is here describing the flow sheet of mainstream economics since Walras’s time, a narrative with one monological character – the sovereign consumer. I am going to go back and look at the oddity of this construct, which arose when economics made a subjectivist move at the end of the 19^th century, in marked contrast to the direction of the other social sciences.  

Lamartines (from an old post)

Last night, I went to a lecture about the supposed father of Amer-Indian studies in France. The woman who gave the lecture made one point clear in her first five minutes: Hamy was not and could never be called one of the founders of 'Americaniste" studies in France. It was all a hoax. Not an intended hoax, but one of those hoaxes that arise in the collective unconscious of an institution - in this case, the institutions of anthropology that dominated in fin de siecle France.
In my terminology, she had found a Lamartine.

Lamartines

Alphone de Lamartine, who knew Joseph de Maistre, described him, after he was dead, as being “large [d’une grande taille,], handsome and male of form and face.” Madame Swetchine, who also knew de Maistre, was taken aback by those lines: “M. de Lamartine says that he saw a lot of M. de Maistre. The number of those meetings makes it all the more surprising that his description of the man was misleading to such a degree. Not one touch was precise or faithful to the original. Count de Maistre was of middling size, and his features were irregular. There was nothing incisive in his eye, to which his short sightedness lent something lost in his gaze. This irregular, and not very brilliant face nevertheless had a majestic radiance.”

The witnesses summoned by the historians are all fed their lines by someone, usually the insatiable self, the vulgarian whose dirty fingers are even in our hot tears. Leaving fingerprints. Lamartine is the biggest goose of French literature, with his tedious lyrics and his lukewarm liberal politics. He is the very type of the sots from whom Baudelaire, later, begged in vain for a break to keep him from slipping into the abyss of want and madness. Madame Swetchine, bless her soul, did not reckon that there was a stye in Lamartine’s eye – his ego. The problem with history is that it is packed with Lamartines. The process is fucked, the jury is packed, the judge is limited by his caseload, his languages, his headache, his faulty hardons.

Any good carpenter knows a rotten two by four. Anyone with a nose for it knows a rotten fact. But we have to build with available materials.

anti-Sopa

the nervous character: Zeno 4

The popular stories about the introduction of various forms of using tobacco are always about the military. It is said that the habit of cigarette smoking passed from the Spanish soldiers, who had learned it from Brazilians, to the French in the 1830s. However, there is another story that locates the re-invention of cigarettes in the 1850s wars between Russia and Turkey. A Turkish soldier, whose pipe was destroyed by a bullet, put tobacco in the paper from the envelop of a cartouche, and smoked it. [[Ferland, 2007] And still another claims that it was the French soldiers, arriving with paper and tobacco, who diffused the habit in Russia. These different stories could be sorted out by considering that the Brazilians and Spanish may well have used a corn leaf – which is how cigarettes were described as late as 1864 in G.A. Henrieck’s Du Tabac. There we read that cigarettes are rolled in paper “sans colle”. Indeed, this was the technical difficulty with cigarettes as a commodity: its fragility.

The military is mobile, and at the same time idle, which has some effect on the form of drug that is being used. Tolstoy’s letter to his aunt Tatiana Yergoloskaya in 1851-2, when he was garrisoned in the Cacausus, describe the garrison life very well.  Garrisons were foyers for all the products that kill time, from gambling to smoking to, in recent times, heroin and marijuana. Also for politics and literature.

Here’s Tolstoy as he starts to settle in the garrison life:

 "I was at Stariy Yurt. All the officers who were there did nothing but play and at rather high stakes. As it is impossible for us when living in camp not to see each other often, I have very often taken part in card-playing, and, notwithstanding the importunity I was subject to, I had stood firm for a month, but one day for fun I placed a small stake: I lost. I began again: I again lost. I was in bad luck; the passion for play had awakened, and in two days I had lost all the money I had and that which Nikolay had given me (about 250 rubles), and into the bargain 500 rubles for which I gave a promissory note payable in January, '52.”

Tolstoy, of course, was not a typical officer, and killed time by writing “Childhood” and reflecting on the world around him.  Lucien Leuwen, the hero of Stendhal’s novel, shares some traits with Tolstoy – notably, his wealth and connections and interior life. But Stendhal’s hero is engaged not in suppressing the Turkic speaking mountain people on the Russian frontier, but, or so he feared, the French speaking people on the class frontier in Nancy – as Stendhal sets his story just after the French army had suppressed various worker strikes in Metz. Still, the life of idleness represented by Stendhal – and the contrast with the ambitions of the hero – takes on a very similar tone.

If killing time in the garrison corresponded with the use of drugs, it was a different kind of time that corresponds to the popular image of cigarettes by 1900.  In a sense, this is the same problem of weight and mass that is discussed in the preface to “The Telegraph as a means of commerce” (1857) by Karl Gustav Knies, who compares the ‘commodities’ of things, persons, and “information” – Nachricht. Knies was one of the first economists to recognize that telegrams, by introducing a real time speed into the diffusion of information, had, as it were, given a premium to the light and speedy. To come to this conclusion, Knies had to frame for himself a sense of information that, at the time he wrote, was still lacking. Yet he knew that the Nachricht “is obviously one of the objects in which commerce between people is represented.” Information (or “report”), unlike thought, requires distance – and even if one presumes to have information from oneself, one is at least metaphorically putting oneself at a distance from oneself. More normally, though, communication goes from a sender to a distanced receiver. Knies points out that if we have certain information that seems timeless, or at least doesn’t lose value in being transported from the sender to the receiver, much of what we communicate has only a passing value – just as any other commodity has. In other words, there is a shelf-life for reports. At the same time, there is a double time frame, one in which the immediacy of the need to which information corresponds may not be the same for the sender and the receiver. These things are true about letters and oral communications – but with the telegraph, a whole news temporal order, and a whole shift in the social construction of ‘immediacy”, comes about on the mass scale.

In a word, the lightness and quickness of the telegraphic message presages a different tempo in the life of human beings, which calls out for a drug that is both speedy and that suspends speed. That was the cigarette. It needed, however, to be technically changed. The cigarette becomes the object of certain changes, in manufacture and marketing, that make it an exemplary product of the turn to consumer goods in the later nineteenth century. Famously, the development of the tobacco industry in Russia, in which a skilled group of cigarette rollers were trained to produce cigarettes to serve a mass market, jumpstarted the American cigarette industry, which took its real start when James Duke enticed a number of Eastern European Jewish cigarette rollers to move from New York to North Carolina to train a number of Southern factory workers. Duke could not find an entrance to the cigar industry, so he chose to enter the tobacco industry by enlarging the production and market for cigarettes. America was famously addicted to cigars and chewing tobacco for most of the nineteenth century: cigarettes were suspiciously European. Duke introduced mechanisation, a new packaging method (a hard paper box), and advertising. Although he never was able to take over the cigar industry, which was resistant to the kind of speeded up manufacture that suited cigarettes, he did establish a strangle hold on cigarettes by 1912.

These are all developments that made cigarettes a symbolic accessory for the changes in the tempo of life that was being felt by urban populations in the U.S. and Europe by 1900.

The characterological correlate of this tempo was: the neurotic.

the new non-idle rich!

The NYT, which is caught between a love for the one percent that blooms in its style magazine and its business page and a political atmosphere in which the chummy relationship between liberalism and the one percent is coming apart, unrollsanother of its color pieces about the lifestyles of the rich. It features one Adam Katz in its first paragraph: “Adam Katz is happy to talk to reporters when he is promoting his business, a charter flight company based on Long Island called Talon Air.” So what did the Times reporters ask him?

Well, we are not far into the article when, breezing past the assets – “…an $8 million home, a family real estate company in Manhattan and his passion, 10-year-old Talon Air” … we are assured that, like so many of the 1 percent, Talon is a dynamo, a man who makes your average doublejob mom or dad seem like a slacker:

“”Still, they are not necessarily the idle rich. Mr. Katz, who sometimes commutes by amphibious plane and sometimes carries luggage for Talon Air passengers, likes to say he works “26/9.”

Of course, the NYT – as its Public Editor, Arthur Brisbane, recently put it – isn’t in the business of the “truth”. If a presidential candidate or a rich man says something, it is the Times policy to simply print it, and let he who has an hour to kill and Google find out if it is true or not. Such a comforting doctrine! Luckily, I am one of the idle non-rich, and having the time, I goodled Mr. Katz, and found that, in other interviews, Mr. 26/9 gives a different peek at his life. Especially revealing was his interview with OceanHome, which, you will be surprised to hear, does not contain any stories about CEO Katz manfully struggling to manipulate a hundred pound suitcase into his jet’s tight suitcase storage space.  He paints a different view of his time expenditure – for instance, in response to the question about what he did when he bought his current mansion in Nassau County: 

“After purchasing it in 2007, I did a $3.5 million gut renovation, rebuilding it as a six-bedroom smart house, using a Creston system for controlling everything from lighting, sound, and temperature control to operating any of the 20 flat-screen TVs that fold down from the ceilings. I added a movie theater, a solarium with a sunken hot tub, a customized gym, outdoor kitchens and fire pits, Jacuzzis, an infinity-edge pool, radiant heat terraces, and a dock for my 135-foot motoryacht and 47-foot Intrepid speed boat, with Ipe (Brazilian Walnut) steps leading to a private beach.”

You might think that all these accoutrements make it even sadder that he is spending 7 days a week away from home. But don’t cry! It turns out that he sometimes his working time is spent amid the solarium, Jacuzzis and pool: 

What do you love most about waterfront living?
I love the privacy of it all, and the views are always spectacular, particularly when the sun sets across Manhattan. Better yet, I can commute to the city via my speedboat in 15 minutes.
Is one particular room in the house used most?
For me, it’s the 2,000-square-foot master bedroom, mostly because of the water views and the comfort of relaxing near a wood-burning fireplace. And it’s where my home office is. Like I said before, because the house was built in the round, it really feels like you’re sleeping on a ship at sea.

Still, “easy living”, as Ocean Home labels the article on a man who works harder than any four man in the bottom 99 percent, doesn’t always elude our hero. For instance, asked about the worst element in living in a house facing the ocean, Katz said: “Cold temperatures and wind are pretty intolerable during the winter months, which is why we head down to the Bahamas and live and sail around on the yacht.” 

Life, on the whole, is hard for the 1 percent: “They work longer hours, being three times more likely than the 99 percent to work more than 50 hours a week, and are more likely to be self-employed,” according to unreferenced stats in the NYT article. But I like to think that the fifty hours of week does have its softer side. I imagine, for instance, there might even be tax write-offs involved with working and sailing that yacht around the Bahamas. But these are mysteries the 99 percent know not of.

smoke em if you got em: Svevo 3

The closer one comes to a material detail in a text, the more distant appears the division between symbol and fact. Symbol and fact are always found in one another's arms, like lovers, and it is not an easy task to separate one from the other. And the person who does attempt to separate them must put on an anerotic mood, and will always feel a bit like a prude, a busybody or a fool. Besides, just as he pries away the fact, undresses it and preps it for the  table of statistics, let him turn his back for only a moment - and it is irresistable, this turning of your back on the fact - and when he turns back the fact will have simply embraced another symbol, or worse, the same one.

For example, take the historic facts in the case of tobacco...


William Weaver’s translation of Zeno's Conscience begins by looking at Italo Svevo’s name – “(his real name): Ettore Schmitz. The first half is Italian and, significantly, it is the name of a Greek hero, not of a Catholic saint. The surname is German. Then consider the birthplace: Trieste, a city that has had many masters, from ancient Romans to Austrians to Italians. In 1861, when Ettore Schmitz was born there, Trieste was an Austrian city, a vital one, the great empire’s only seaport and a focus of trade between central Europe and the rest of the world.”


The split Weaver points to in Svevo’s very name is, if we look a little at the history of tobacco, echoed in Zeno’s habit.


A few subtending facts, then.


In December, 1847, Italian nationalists in Milan (which, like Venice, Trieste and other parts of Italy, were under Habsburg rule) decided to imitate the American tea party – just as the Americans boycotted tea to protest British rule, they would boycott tobacco to protest Austrian rule. Tobacco was chosen for good reason: the Austrian state exercized a monopoly on the sale of tobacco. Since the habit of smoking tobacco in cigar form had been “brought” into the German sphere by English soldiers during the Napoleonic war (such, at least, was the myth to which German writers on tobacco subscribed), the Austrian state, like the Prussian state, had reacted by regulating its use. But unlike the Prussian state, the Austrian didn’t only ban smoking in public in the capital – they also devised different regulatory regimes for different regions in the Empire. And they promoted the creation of large tobacco estates in Hungary, which became part of one of the largest industries in the Empire, from cultivation to curing to manufacture of snuff, pipe tobacco, and cigars. [See Wickett, Studien ueber das Österreich Tabakmonopol, 1897]


In Dalmatia, state control of tobacco production was relaxed – in accordance with the liberalization of this area of the Empire that had been inaugurated by Joseph II. Trieste was well known as an entry point for the tobacco smuggling trade. In 1830, when Stendhal was the French consul in Trieste, he had remarked upon the openness of the smuggling trade. The tobacco that came in was, most likely, of Egyptian origin.


In Milan, the Austrian state had no rules about smoking in public. The Milanese liberals, voting to boycott smoking, sparked a nationalist feeling in the populace. On the 2nd and the 3rd, there were disturbances in the street, as cigars were plucked from the mouths of passerbys and thrown into the road.


But who were these smoking passerbys? Here, contemporary accounts differ. According to a French history from 1857, the Austrian government, knowing that the boycott was coming, had distributed 30,000 cigars to the Austrian garrison in the city. Thus, the soldiery was ‘armed’ with smokes, and when the crowds attacked, they took this as a provocation to violence and reacted accordingly. According to a contemporary Italian historian (Giusseppi Ricciardi, 1850), the smoking soldiers were joined by smoking criminals, who had been released from the jails and given cigars by the Austrian authorities to add to the confusion. Like a trick cigar, the situation ludicrously exploded, with rioting that spread to other cities in Italy.


But in Berlin and Austria of that year, the public/private meaning of the cigar was reversed. The laws that were put in place after the Vienna congress had banned cigar smoking in public, and thus made cigar smoking a daring act – or at least an act of symbolic resistance. The progressive smoked cigars – “ a democratic symbol for rabble rousers and agitators’ – while the petit bourgeouis smoked pipes. As the revolution spread, in 1848, from Paris to Berlin and Vienna, one of the demands of the liberals was the freedom to smoke in public – shoulder to shoulder with the freedom of the press.


Against this background, there is not only a split in Schmitz’s pseudonym, Italo Svevo, but even in the meaning of the tobacco addiction that provides the connection in Zeno’s account of his life. Freedom, for the Italian patriots, came via giving up tobacco. Freedom for German patriots meant taking up tobacco. And freedom is at the heart of the habit that Zeno describes, the perpetually renewed freedom of giving up the smoking habit:

"I believe the taste of a cigarette is more intense when it’s your last. The others, too, have a special taste of their own, but less intense. The last one gains flavor from the feeling of victory over oneself and the hope of an imminent future of strength and health. The others have their importance because, in lighting them, you are proclaiming your freedom, while the future of strength and health remains, only moving off a bit."

  In Georges Bataille and Roger Caillois’s program for the College of Sociology, they wrote of ‘establishing points of coincidence between the fundamental obsessional tendencies of individual psychology and the directing structures that preside over social organisations and command revolutions.’ Surely we have landed upon one of those points.


And yet – not quite. For what Zeno smokes as a mature man are cigarettes. His brush with cigars, though, was his first brush with tobacco. His father was a cigar smoker (like, it should be remembered, the founder of the psychoanalysis that provides the framework for the story – Freud). His father had a habit of smoking half a cigar, then leaving the butt for later. Zeno had a habit of stealing and smoking those butts.


“My father left some half-smoked Virginia cigars around the house, perched on table edges and armoires. I believed this was how he threw them away, and I believe our old maidservant, Carina, did then fling them out. I carried them off and smoked them in secret. At the very moment I grabbed them I was overcome by a shudder of revulsion, knowing how sick they would make me. Then I smoked them until my brow was drenched in cold sweat and my stomach was in knots. It cannot be said that in my childhood I lacked energy.”


We have not yet reached the moment of the cigarette. However, it is as though Zeno had to wean himself from cigars in order to reach that moment himself.

Svevo's Zeno 2: the croupier's rake

The individualism of methodological individualism is a strange beast. On the one hand, it promises a robust defense of the individual as the ultimate level of social analysis. All collectives, go the doctrine, are composed of individual behaviors. There are no collective agents – like a pantomime horse, when you see a collective – a state, a firm, an organization – you are seeing the sheeting over the actors inside it. And yet, this defense of the individual is, at the same time, an emptying out of the individual. Whatever his or her beliefs, passions, or promises, in effect the content of the individual consists of an algorithm for calculating the maximization of his or her advantage. It is thus that the pantomime horse of capitalist organizations gets to its feet and proceeds to walk all over you. Hayek, who was a great believer in individualism, was conscious of this paradox and explains it in The Counterrevolution in Science.  It happens that those who are not entirely sold on individualism and those who emphasize ‘historicism’ – the interpretation of social action that does not hold that a universal maximizing principle is at the heart of it – are pretty much synonymous. This gives us the paradox that those who emphasize the collective level are also those who oppose the universalism of a conjectural history going back to Smith. Thus, historicists would dispute that, say, price or monopoly as categories developed in contemporary economics could be usefully imposed on social behavior in Egyptian society in 1400 B.C. - the example Hayek uses. 

But, according to Hayek: "What this contention overlooks is that “price” of “monopoly” are not names for definite “things”, fixed collections of physical attributes which we recognize by some of these attributes as members of the same class and whose further attributes we ascertain by observation; but that they are objects which can be defined only in terms of certain relatins between human beings and which cannot possess any attributes except those which follow from the relations by which they are defined. They can be recognized by us as prices or monopolies only because, and in so rar as, we can recognize these individual attitudes, and from these as elements compose the structural pattern which we call a price or a monopoly. Of course the ‘whole” situation, or even the “whole of the men who act, will greatly diiffer from place to place and from time to time. But it is solely our capacity to recognize the familiar elements from which the unique situation is made up which enables us to attach any meaning to the phenomena.” (66)

Hayek’s notion – which appeals, in the end, to an "us" who is above the wholes of the situation and the men involved – reflects a pattern of social meanings that capitalism introduced into Western Europe in the 19^th century, and with which, especially, intellectuals caught up in the sphere of circulation wrestled: the seemingly unbridgeable difference between the individual as an accounting entity and an individual as an existential mystery. The latter is on the side of ‘experience’ – but the former rides mankind. Experience fills in the empty algorithmic unit – the economic individual – with matter that seems, well, beyond the bounds of his maximizing reason, or the reduction to individuals that is theoretically called for in analyzing economic action. The money in my pocket passed to me from some individual, truly, but the individuals involved in the chain that touched that money are all, with regards to me, rather empy and automatic – the man who put the money in the ATM machine, the woman who gave me change at the grocery store, the software engineer who designed paypal, the client who paid me – all are in my life to varying degrees, but their roles, the money, and myself seem to be bound together by arithematic more than intimacy. “The technical form of commerce creates a ralm of values that is more or less commpletely loosened from its subjective – personal substructure,” Simmel says (30)

It is in the conflict between the two aspects that is brought to bear on the discourse on freedom that was passed down from the ancien regime to the increasingly capitalist dissolution of the ancien regime in the  nineteenth century. “Commerce always strives – never fully unreal and never fully realized – towards a stage of development in which things determine their value through a self-acting mechanism – unmarked by the queion of how much subjective feeling this mechanism has taken into account as its precondition or as its matter.” (Simmel, 30)

These conflicting aspects of individualism are very much part of Svevo's novel, Zeno's Conscience - for the conscience is, too, both a peculiar personal thing and a sort of introjection of norms and rules that the individual was never consulted about. At one point Svevo’s narrator,  Zeno Costini, who, as the  heir of his father’s business, has nothing to do – by which we readers understand that he does not need to do anything to have money – insists on being given a job with his Olivi, the man to whom Zeno’s father entrusted the management of the business. Consequently, Zeno is instructed in accounting - or 'economics':

“Olivi’s son, an elegant, bespectacled young man, erudite in all the commercial sciences, took over my instruction, and I honestly can’t complain about him. He annoyed me a little with his economic science and his law of supply and demand, which seemed to me more self-evident than he would admit. But he showed a certain respect for me as the owner, and I was all the more grateful because he couldn’t possibly have learned that from his father. Respect for ownership must have been part of his economic science. He never scolded me for the mistakes I often made in posting entries; he simply ascribed them to ignorance and then gave me explanations that were really superfluous.

The trouble came when, what with looking at all those transactions, I began to feel like making some of my own. In the ledger, very clearly, I came to visualize my own pocket, and when I posted a sum under “debit” for our clients, instead of a pen, I seemed to hold in my hand a croupier’s rake, ready to collect the money scattered over the gaming table.” (166)

The croupier’s rake instead of the pen! – one seems magical, a wand that brings us back to the archaic, pre-capitalist world of treasure, while the other seems anything but magical, imprisoning us in double columns. The libido of the sphere of circulation flows into this image, which has urged itself upon theorists and clerks since the days of Law’s system.

On Svevo's Zeno 1

V.S. Pritchett once wrote about the novelist’s knack of “showing how people live in one another’s lives.” This is not only a concise way of talking about what novelists do – it also points to a large economic fact, which is that people do live in one another’s lives. Surprisingly, economists are, for the most part, blind, or at least hesitant, about seeing this fact. They have even systematized this blindness and called it the ‘micro-foundations of the economy.’

Unfortunately, all too often novels, when they are considered from the aspect of economics, are considered to be free zones over which preconceived economic theories and ideas roam. But one can think of two other relations of the novel to economics – one is as a test of economic ideas, and the other is as a source of economic ideas. It might well be that the social interactions involving exchange, the symbolization of value, gifts, scarcity  – are rehearsed in a sophisticated way in certain novels to the extent that the economist should learn from the novel, rather than the other way around.

I’d like to put these consideration in the background  against which I am writing these notes about  Italo Svevo’s novel, Zeno’s Conscience.

Let’s begin with the novel’s premise. In a short note by Dr. S., Zeno’s journal is presented to the reader as an act of malice on the part of Dr. S., and a means of ‘catching’ his former partient. In other words, the novel begins with the breaking of a contract, that of privacy between the doctor and the patient. It begins outside the law, so to speak. Zeno’s own notion is that his memoirs are therapeutic, serving one end: to help him break the habit of smoking.

Thus, on the one hand, we have the broken contract to which the book owes its existence as a published object – and on the other, we have the desire to break a habit to which the book owes its existence in the mind of the narrator. 

Before I begin with the second form of the book’s existence, let’s look at what is implied in Doctor S.’s premise – that a book not only has an inward side of content, but an outward side that objectifies that content. The book is a product of writing. Writing creates an object. And objects are not, contra the economist’s grand model, all the same kind of commodity. If they take on the form of the commodity, they take on that form because their use value for people living in each other’s lives varies not just in terms of some original position in which a preference is expressed, but in the way that preference is lived with. For instance, there is addiction. There is routine.

As Svevo’s novel was translated into French, it began to be noticed in Italy. The poet Montale wrote an enthusiastic review that, to an extent, introduced the Italian intelligentsia to Svevo, this half German Triestian Jew, whose language, according to his English translator, William Weaver, seemed “flat, unaccented, even opaque.”

Svevo wrote Montale a rather extraordinary letter, expressing his thanks and correcting Montale’s assumption that Svevo was a modernist writer linked to Joyce and the literary schools of Paris.  Instead, Svevo took the view that writing was a form of performance and manufacture – and even a form of bad habit.

“I feel the need to tell you that I don’t believe that the difference between Conscience and the two preceeding novels should be searched for in the influence of the most modern literature. I was very unaware of that literature when I was writing, since after the failure of Senilita, I forbade myself literature. I even had a ruse to help myself from falling bak into it: I studied the violin and I conscretated to it, for twenty years, all my free time. I read a lot of Italian novels, and among the French, the greatest authors of our time. I know English, but not enough to easily read Ulysses, which I am now reading slowly with the help of a friend. As to Proust, I am now hurrying to to acquaint myself when, last year, Larbaud told me that in reading Senilita (which, like you, he loves especially), one thinks of that writer.

“It is true that Conscience is a  completely other kind of thing than the preceeding novels. But just think that it is an autobiography and not my own. Much less than Senilita. I put three year into writing it in my free moments. And I proceeded in this way: when I found myself alone, I tried to persuade myself I was Zeno. I walked like him, like him I smoked, and I stuck on my past all of thos of his adventures that resembled my own, for this sole reason: that the evocation of a personal adventure is a reconstruction that easily becomes an entirely new construction, when one succeeds in placing it in a new atmosphere. And it doesn’t lose so much the taste and value of a memory, no more than its sadness. I am sure that you understand me.” [Translated from Ecrits intimes, essais et lettres trans. by Marco Fusco, 1973]

For a reader of Zeno’s Conscience, this is a pretty astonishing letter, since it seems to be both a distancing from Zeno and a usurpation of his style of audacity – the peculiar audacity of the fool that we can see, as well, in the Jewish jokes that Freud loved, and in Kafka’s never-say-die men, who are continually scheming to get into the Castle.Remember, Kafka howled with laughter when he read his own stories to his friends, according to Brod.

In Svevo, that audacity takes the peculiar form of hypochondria and addiction – which are, in turn, exemplary forms of routine. Svevo even takes writing as an addiction that he prevents himself from falling back into by taking up another routine, one that he knows he is bad at – just as a recovering  alcoholic will take up cigarette smoking, and a cigarette smoker, gum.

This, of course, is a whole other dimension of revealed preference.

TBC

New year predictions for the moronic inferno, version 2012

Prediction is a doddle. Successful ones usually fall into two groups: the easy and the lucky. In human affairs, the easy are usually derived from the two great grifter principles: 1. there’s a sucker born every minute, and 2. never give a sucker an even break.  applying these as your two parameters can make you seem like a genius when the subject is a society like America, the con man’s paradise. As for the lucky, they are composed of guesses that are driven forward by some unguessed social pulsation. Prediction, in this case, gloms onto a phenomenon without glomming on to its cause, and thus loses its intellectual strength.

I think I can rely on the  grifter principle to predict that Mitt Romney will defeat Obama, and that Romney will face a strongly Republican house and a majority Republican senate. The problem here is that the same principles also give us an Obama win. However, the superstition that lightning never strikes twice in the same place gives the edge to Mitt.

Obama, however, will proudly pass onto Romney a plutocracy that is almost completely intact, save for the odd Maddoff casualty. 16 trillion dollars in emergency loans, at 1 percent or below, have saved the upper 1 percent for us all. We are, well, tearfully grateful, of course.

The bankruptcy of hopeyness cannot of course be laid completely at the President’s feet. In fact, all liberal-left parties in the West have rotted from the head. When they work and actually elect a leader, the leader and the party then engage in such clueless policy making as would puzzle the angels. Except, of course, those fallen angels who have read Marx.

The latter have notice that, in the course of the state sponsored well being spread out over the last sixty to seventy years, a certain political and business class has done extraordinarily well in both conservative and liberal-left parties. The elite in the latter face a problem that is intimately connected to their ascent to the rarified 1 percent group, for in effect, as their personal circumstances change, so do their interests. Interests are always a hermeneutic product, but hermeneutics is done on a social level as well as a subjective one. If the tissue of your social level is constructed from interactions with fellow citizens in the gated community and the habits that grow around the perks of great wealth, your relationship to a party base that is composed of much lesser mortals becomes one of a strained sympathy. The result of this has been a threefold splintering of left politics. Substantially, the party elite engages in the ‘nudgework’ of slowly unwinding and destroying the progressive legislation and institutions that were gained over the past one hundred some years. They aren’t elected to do this, of course – quite the opposite. But they do it because it is in their interest to do it, and they simply quietly project their interest upon the population as a whole and believe, often quite sincerely, that the population as a whole is just living a little too well and needs discipline. It never occurs to these denizens of the 1 percent that they are living too well – this is a thought that simply can’t get through the gate. The gated community is especially vigilant in suppressing such ideas.

However, in order to distract their constituencies, the party elite is ever alert to moral panics and sensational trivialities. This is the sum of their political art. And thus, as congressmen making ‘regulations’ for banks retire to become lobbyists for banks, or tax breaks for the wealthiest are somehow tantalizingly never closed, or emphasis shifts from immediate problems – massive and catastrophic levels of unemployment – to problems involving the tax burden on the 1 percent’s next generation – that terrible deficit! – massive distraction work is called for. And this involves the elite’s third political method, identity politics.

Two recent newspaper stories provide a little glimpse into the content and soul of the Obama era.

One was the recent contribution by his former economics advisor, Christina D. Romer, to a NYT roundup of economists for Year End reports was a cri de coeur of Obama-ism. It contained this gem:

“On the deficit, the big worry isn’t the current shortfall, which is projected to decline sharply as the economy recovers. Rather, it’s the long-run outlook. Over the next 20 to 30 years, rising health care costs and the retirement of the baby boomers are projected to cause deficits that make the current one look puny. At the rate we’re going, the United States would almost surely default on its debt one day. And like the costs of maintaining a home, the costs of dealing with our budget problems will only grow if we wait.
We already have a blueprint for a bipartisan solution. The Bowles-Simpson Commission hashed out a sensible plan of spending cuts, entitlement program reforms and revenue increases that would shave $4 trillion off the deficit over the next decade. It shares the pain of needed deficit reduction, while protecting the most vulnerable and maintaining investments in our future productivity. Congress should take up the commission’s recommendation the first day it returns in January."


Notice the bogus analogy to the house. Notice that the deficit is considered only from the side of government spending, and no notice is taken of the effect on growth if we ‘sensibly’ shave off the ability of the majority to retire in any type of comfort, educate themselves, receive health care, or even receive standard government services, which of course are all determinates of growth and affordability. The Bowles-Simpson commission, of course, never made any suggestions because it couldn’t ultimately agree on its ‘sensible’ cuts, but the country club set hears what it wants to hear, and what it heard was the joyous sound of an ultra-right Republican senator giving cover to an ultra-connected Democratic lawyer for screwing Democratic constituencies up the wazoo. This is Obama’s vaunted ‘socialism’. Alas, it ain’t socialism. It is rat poison, and its effects, so far, are predictable: it has killed the beast. The enthusiasm of the Obama people for Bowles Simpson is not the reason Obama will lose, but it is a symptom of the attitude that will lead to his loss: an astonishing callousness with regard to the biggest slump in employment in two generations, a blindness to the American middleclass’s plucking as its housing asset disappears into a murk of bad mortgages and illegal bank finagling, and a general disconnect from any issue whose explanation would displease the 1 percent, from global warming to the Gulf disaster.
Such, then, is the policy substance that makes President Nudge’s reign a curious mixture of elevated but robotic rhetoric and astonishingly boneheaded reactionary policy, sweetened around the edges with the occasional liberal approved appointment.
But a political regime doesn’t just live – or die - on policy substance (and substance abuse). Politics has a soul. Soul, in America, is the kind of work that has devolved upon celebrities, since nobody else has time for it. Here, one needs an ear to hear. One needs to read for symbols. And a beautiful symbol came down the pike this holiday season: the bio-pic of Thatcher, brought to you by the makers of Mamma Mia.
Meryl Streep, who stars as Maggie Thatcher, is giving interviews that are simply alight with the privileged world view of the 1 percent liberal. This is the end of one she gave the NYT:
““So did Margaret Thatcher. But that’s understandable. She couldn’t show weakness. Imagine what the men would have said.” She added: “In parts of England now it’s a transgression even to consider her as a human being. She’s that monster woman, the she-devil. For me the point of the film was to find the human side.” And though hardly a Tory, she said she vividly recalled the moment when Mrs. Thatcher came to power. “Just as I remember not voting for her, I remember sitting in my room at university when the radio announced that she had been asked to form a government, and I went ‘Yes!’ It felt like one for our team.”
Ms. Streep nodded and said: “I did the same thing. We all thought if it can happen in England, class bound, socially rigid, homophobic — if they can elect a female leader over there, then it’s just seconds away in America.””
Streep is old enough (as am I) to remember the beginning of the feminist movement in the 70s. Back then, the point was to destroy patriarchy. Now, of course, the point is to find women (one from “our team”) who can be leaders – the CEOs of tomorrow! This is a feminism neutered of its original purpose, and remade in the interest of ‘role models’ – that combination of fetishized hierarchy and moralism that is the wholly owned subsidiary of patriarchy. Where once feminists fought corporations on behalf of the millions of women who were victimized in the system that gave corporations outsized power, they now are supposed to fight to make sure those corporations are led by women who, in a triumph of the new, new feminism, have broken the glass ceiling and receiving the stock options and outsized salaries of their male counterparts. The liberal-left party in the U.S. has always had a bad conscious about class, but as class recedes as an issue that the elite takes at all seriously, it becomes what all things become that sink into the unconscious: a ghost. A specter, as Marx might say. Identity politics, haunted by that spector, becomes a compensatory activity, a form of pablum, rather than a revolutionary activity. The center not only holds, it freezes the moment of liberation, stuffs it full of windy truisms, and wheels it out on all occasions in order to keep the party – the political system that has been so good to the elite - going.  This is the way formerly liberal-left ideas, bereft of their former revolutionary context, are effortlessly assimilated to the great liberal country club that goes on to worry about the deficit and the bad habits of the lower classes. Thus, Maggie Thatcher, who unleashed a Hobbesian lifestyle on the majority of British women under the withered blessing of Hayek and General Pinochet, becomes a role model of female leadership. 
Jesus (and Susan B. Anthony) wept.  
And with that: have a happy new year!

 

From 2007

Making the rich less rich is not socialism

I’ve become a reader of Floyd Norris’ blog over at the NYT. I’ve noticed, with some amusement, that any time a vague and distant hint arises that the rich in America might be oh, oh, slightly too… rich, the comments section is reliably flooded by screeds against socialism and for the American way.

It makes me long for a snappy way to point out that capitalism was not abolished in the U.S. in the fifties, nor was the Reagan tax cut on the wealthiest the second coming of Adam Smith in the eighties. What is funny about the rabid defense of the wealthy is that I imagine it often comes from the non-wealthy. It isn’t like billionaires are trolling blogs. But what they are defending is, of course, absolutely against their interests. It is the great American paradox: the almost saintly disinterestedness of the American householder in defense of systematic greed.

There are a number of ways to redistribute wealth down. Imagine, for instance, that unions had been strong enough, back in the eighties, to peg earnings to the ratio between upper management and the lowest paid functionaries in a company. Back then, the ratio was about 70 to 1 – today, it averages something like 300 to 1. If the unions had done this and the CEO level had succeeded in extorting the pay packages they had today, we would be living in a utopia in which the merest entry level receptionist would be taking home 150-200 thou. This would be excellent – except of course that corporations would no longer make profits. Instead, they’d be pouring all their cash into paying their workforce. Still, at the 70 to 1 ratio, upper management’s efforts to increase their compensation packets would have significantly pulled the earnings up of the entire workforce.

Unfortunately, when you don’t have powerful unions, you have to rely on the countervailing powers of the state. You have to work, then, to raise the taxation on the upper tier considerably. You have to do this not only because you need to pay for public investments, but because there is a macro good to great income equality. For one thing, it discourages economic activity that is, in reality, mere churning. Looking at the mortgage mess, one can see more and more clearly how the fantastic, Pirenesian structure of false economic activity has worked since 2001. It has allocated money not to the most productive, but to the most churnful. For another thing, more equality now means more equality latter. As the gap widens between the resources of the rich and the not-rich, it becomes exactly what we socially reproduce. Those non-rich who, for instance, decided that the death tax, otherwise know as the estate tax, was just terribly unfair to their children actually screwed their children terribly, because they are not leaving the kids fortunes, whereas the fortunate few are – thus aggravating the already unfair structure that separates rich from non-rich children. The cost of abolishing the estate tax is borne by the non-rich in such areas as trying to get their kids into top schools and the like.

But what most impresses me about expropriating a good share of the wealth of the wealthy is its environmental impact. As anybody with the eyes to see can see, the last twenty years have been years of great GDP growth in many countries. In fact, the whole Tom Friedman-esque economy is oriented towards steroiding GDP. Why? Because if you are going to have increasing inequality, growth is the way that the middle income sector – the vastly more numerous non-rich – can, at least, maintain their lifestyles. But GDP growth could also be called the Diminishing Environmental Return. DER is the natural result of overexploiting a system that is limited in many ways. Put up a zillion towers for cell phones, and you can say bye bye to songbird populations – make your McMansions of tropical wood, and strew them with the kind of wiring that gives you 24/7 instaconnectoinstamaticinstatubelivegirlsxxxxpronomatic action, and you can say bye bye to the environment of Sumatra. Down the intertubes it goes. It is an incredible waste of resources, which is the total result of the elite decision to grossly exacerbate the wealthiest’s share of the wealth. With a greater equality of income, of course, GDP doesn’t have to grow as fast. The drift of our current society into endless war, endless stupidity, an endlessly degraded public sector, the unwinding of all those hard fought democratic gains of the last one hundred years, is the direct result of a simple arithmetic ratio. To repair this – to go back to the managed capitalism, as Kuttner calls it, of the past – isn’t socialism – it is the self interest of the vast mass of American citizens.