What follows is the second part of an ongoing conversation that I’ve been having with Jim Livingston about the left and liberalism. Part One is here.
AH: All right, let’s talk about markets and liberalism. And democracy and socialism.
JL: OK. Let me slip the yoke, just for a minute. Let me ask: was John Maynard Keynes a socialist?
I ask the question for two reasons. I still don’t understand why the Left of our time defines itself as against the intellectual legacy of liberalism, even in light of your unfolding argument about Marxism in the making of modern America (the Left had to differentiate itself from the vital center). And I still wonder why markets seem to be the divisor—as if on one side of modernity you’ll find markets, liberty, individualism, and liberalism, and on the other you’ll find statism, equality, solidarity, and socialism. As if we’ve revived the debates of the 1930s!
The question comes down to this: Can you be both a liberal and a socialist? My answer—until all the recent fuss about academic freedom—was, “Of course you can, and you’d better be, because the Left is sometimes ambivalent about claims to the protections of free speech, and the Right is, as always, indifferent to human rights unless one of its appointed idiots gets himself in trouble. To be a liberal and a socialist is to have some grasp on human rights, and so to protect yourself against the predations of both sides.”
AH: Wait a minute. How does academic freedom enter these equations? I thought we were talking about markets.
JL: They’re related., I think. I’ll get back around to markets as such. Meanwhile, consider the intellectual situation on campus, or rather on the campuses of niche-liberal colleges and elite universities, like Oberlin, Middlebury, Wellesley, and Northwestern. On these sites, both left and right-wing positions have been protested, investigated, and even silenced—according to formal protocols drawn from Title IX offices, but also according to informal protocols drawn from crowd-sourced notions of popular justice. So, Laura Kipnis, a left-wing feminist, becomes the object of student protest at Wellesley and Title IX investigation at Northwestern; meanwhile Charles Murray, a right-wing racist, is silenced by student protest at Middlebury. In both cases, it’s the campus/academic Left that leads the charge. Why?
Why this anti-liberal bias against free speech? Why does liberalism—OK, put it as crudely as the “free marketplace of ideas”—become the problem for both sides of what is not even a debate anymore, just an excuse to excoriate the excesses of individualism?
AH: OK, now we’re getting somewhere. Since when is the marketplace of ideas “free”? You’ve written about corporations and administered markets, so you know that this is not a level playing field. Let me go back to where we started in Part 1 of this conversation. I said, “We must be vigilant in the face of an authoritarian state. On that we agree. But in valorizing civil society against the state, many on the left will have a problem with your emphasis that markets are a crucial ingredient of civil society. Markets might not be anti-democratic or authoritarian in theory, but the way in which The Market is used as a sledge hammer for the power of the 1% at everyone else’s expense—especially in our neoliberal age but of course Marx warned about this 150 years ago—it’s difficult to imagine another world in which markets are liberating.”
JL: Yeah, my response wasn’t very illuminating. I certainly didn’t address your references to neoliberalism and Marx—nor the theory and practice of markets. So here’s another go at it.
Markets are a trans-historical feature of human civilization, but until modern times, roughly from the 17th-18th centuries on, they were local, provisional, even isolated, sort of like the farmer’s markets of our time. Commerce was an occasional incident between households—nothing like today, when it’s a constant activity that binds individuals in long-distance chains of social connection. People exchanged goods, of course, but not as an everyday event, and not as individuals detached from households.
Now, there were market economies before the 17th century, but not market societies. If they were market societies, quite possibly teeming with commodities, they were still simple market societies, because labor power was not yet for sale—the creation of a market in labor in the 18th century is the defining characteristic of the complex market society we call capitalism. Also of the complex cultural phenomenon we call modernity. As and when labor becomes a commodity, the world is reborn. The very idea of equality is embedded in the labor theory of value, from Smith and Ricardo on towards Hegel and Marx.
Similarly, money is a trans-historical element of human civilization, but money economies are not—not before the 17th century, anyway, when paper money became commonplace in the Atlantic world. As Marx said so eloquently in The Grundrisse and Capital, Volume 1, paper money is the solvent of the hierarchies specific to tribal, patriarchal, and household economies, because paper money allows anyone to purchase anything.
Social standing has always been a result of effective claims on labor time—how much energy can you mobilize for purposes of your choosing, whether goods production or pillage or profit? Merchant, king, or warrior, you’d better have a legitimate claim on my time and energy. But until the advent of money economies, such claims were a function of your birth, not your income. For example, only noblemen, no matter how penurious, could command the labor time of peasants until a market in land and labor erupts from the wreckage of feudalism in the 16th and 17th centuries. Thereafter it’s anybody’s bid, no matter where you come from.
AH: So you’re saying that the emergence of capitalism was a liberating event, because it created new social roles and structures by making markets ubiquitous. It’s not exactly a new argument, but it sounds different, coming from an avowed Marxist, socialist, feminist, etc.
Still, that was then, this is now. What have markets done for us lately except increase income inequality and impoverish most of the world’s population under the hammers of neoliberalism?
JL: OK, fair question. I’m trying to say that liberalism is an attitude toward markets that we, as socialists, need to adopt if we agree that democracy is our goal. In a more imperative mood, I’m also trying to say that markets are the necessary but not sufficient condition of social democracy.
The attitude of liberals toward markets has always been that they’re the necessary but not sufficient condition of the modernity we can discern in civil society—the widening gap or difference between the state and the household. “Commercial society,” as Smith, Ferguson, and others called it, happened when markets became the organizing principle of everyday life. Hegel followed their lead, but he was always trying to demonstrate that commerce, markets, and their attendants were embedded in a larger social web that included the family and the state. In that sense, none of them—those originary liberals—thought that the market was a self-regulating mechanism.
So the intriguing historical shift in view is this. In the 19th century, the Manchester School types but also the anti-capitalist movements over here, the National Labor Union, the Knights of Labor, and the Populists, ca. 1867-1896, assumed that a free, competitive market would produce equality by subjecting all participants to the same anonymous laws of supply and demand. The threats to this political function of the market, so conceived, were large–scale business enterprise (corporations) and the state itself, either of which could distort or manipulate those anonymous laws. The self-regulating market, and with it equality, were at risk because these unnatural externalities could undermine or rewrite such laws.
In the 20th century, well, at least until the 1980s, the corporate liberals assumed something else altogether, that the market itself was the problem. Corporations and the state were neither unnatural nor external to the market—they were organic, constituent elements of the market, and they were the only ways to salvage the civilizing functions of the market, something which, corporate liberals rightly claimed, had self-destructed in the late-19th century. The market was no longer something to be treated as an intellectually impenetrable system that might permit equality, it was instead a means to the end of variegated social purposes. The Progressive Era was the register of this shift. It changed the meaning of liberalism as well as the market.
Until the 1970s, that liberal assumption—the market itself was the problem—prevailed. Neoliberalism turned that assumption into a question. It was, and is, a bipartisan movement. Deregulation as promoted by Kennedy and Carter was at least as important, for example, as supply-side economics as pimped by Reagan and Kemp, in selling this new brand of liberalism.
AH: Now you’re pointing us toward Ludwig von Mises, Friedrich von Hayek, Milton Friedman. If that’s where you’re headed, let’s stop here and regroup for another session.
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