Hello Keith, hello everyone -
On 01/19/2013 12:48 PM, Keith Hart wrote:
> I believe we are witnessing a drive for corporate home rule which would
> leave them the only citizens in a world society made to suit their
> interests. This is the logical conclusion of the collapse of the
> difference between real and artificial persons in law, since how could
> mere human beings compete with organizations of their size, wealth and
> longevity?
>
> The left has been effectively blindsided by this development because our
> models of what is happening are more rigid and old-fashioned. We talk
> about capital as if it is a static phenomenon that we know about better
> than the fat cats, whereas Coase/Williamson underpins a fast-moving
> evolution that we lack the intellectual equipment and experience to
> understand.
I quite agree with you. Marx's brilliant insights into the dynamics of
capital have been taken as dogma fixed in stone, whereas on the other
side, neoliberal mainstays like Schumpeter long ago absorbed key ideas
from Marx into their systems and used them to complexify the world
around us, not always for the better...
I first came across Coase and Williamson maybe ten years ago, while
looking into the development of what was being called "the networked
firm" way back in the early Nineties. The author I was reading (Walter
Powell, "Neither Market nor Hierarchy") tried to go beyond
Coase/Williamson and develop a new model of cooperation between firms
based on reciprocity and mutual benefit in a communicational
environment. One of his key examples was a study of Japanese firms.
According to him, the sharing of knowledge made such firms better at
innovation. I had this in the back of my mind while writing.
Now, maybe this makes me an older leftist than you (I'm tossing you a
flower, dear Keith) but I still like Arrighi very much. He credits Coase
with identifying the key trait (internalization of transaction costs)
that explains the productivity and profitability of American
multinationals, going back to the late 19th century and particularly the
first two decades of the 20th, when DuPont became so powerful and
basically took over GM, installing Sloan as president. For Arrighi, the
form of the vertically integrated corporation and its capacity to
internalize transaction costs is exactly what distinguishes American
capitalism from the more commerical, trade- and therefore market-based
British world-system of the 18th and 19th centuries. This corporate form
(as distinguished from the British trading house) tells you a lot about
bureaucracy and authority in postwar US culture: the Organization Man
and so forth. The golden age of GM and the other major US multinationals
was also that of American neo-imperialism (1945-73). However, falling
Kondratiev wave or not, I think Arrighi correctly identifies the crisis
of the 70s as the beginning of American decline, under the pressure of
the Japanese challenge (now replaced by the Chinese one).
People underestimate the influence that Japanese methods (basically,
just-in-time production) have had on contemporary corporations. The new
ability for extremely concentrated, quasi-monopolistic firms like Apple
or Walmart to take advantage of and tightly control what are nonetheless
market-based relations with suppliers actually derives from Eiji Toyoda
and his engineer Taichi Ohno, who went together to Detroit sometime in
the Fifties, visited the River Rouge plant and decided Fordism was too
crude a system for them. By opening up two-way information flows with
their parts suppliers, they were able to create a very sophisticated and
responsive industrial system (not to mention some beautiful ergonomic
design). The Japanese approach spread around Asia as a networked
production complex extending from port to port, under conditions where
the Japanese firms had all the capital but could never claim to impose
their will, because of the extremely negative memories left by the
Thirties and WWII. Instead of dominating they cooperated and fostered
win-win situations. As they were very keen on miniaturization, they also
contributed a lot to the popularity of the laptop computer. All this was
in the air when the Internet started to come on the scene, particularly
from '94 onward.
At that time, some people here on Nettime made pretty extensive efforts
to identify new forms of social cooperation that could breathe life back
into the old ideals and desires of the Left. For a while there was some
uncertainty as to whether the new boom of capitalism would not involve
some kind of qualitative mutation toward a "co-opetitive economy" where
you could not distinguish capitalism from something more like anarchist
free association. Alas, Anglo-American capitalism responded to the
Japanese challenge with a kind of one-two punch, developing its networks
for the needs of computerized finance and also for a quite savage
version of just-in-time production. While the former concentrates wealth
at the top, the latter is particularly devastating in terms of the human
ecology, because it enforces a very alienating and also highly polluting
global division of labor. As I wrote in my text on just-in-time
production, "What emerged from the open markets of neoliberalism was a
vast *delivery system* commanded by retailers engaged in a vicious
search for the best possible price. And that turned out to be the 'China
price': the lowest number on the planet for any category of basic
manufactured goods." Instead of creating something original, China has
so far developed under the American shadow, with its vast manufacturing
capacities artificially prolonging the lives of our monstruous
multinational corporations.
So in my view, what we got in the end was a totally sad, distorted and
destructive version of what could, for a time, have represented a
metamorphosis of the whole capitalist system. This metamorphosis, toward
a full-fledged *knowledge society*, would have integrated and
transformed all those sophisticated understandings of social evolution
that you mention. Instead they are now being folded back into corporate
home rule.
The case of Arrighi is really interesting. As you know, his theory of
history (based especially on Braudel) led him to expect a shift of
global hegemony to the new productive centers of Asia. He never thought
this would happen in the same way as it did in the past, because the US
even in its decline retains such overwhelming military power; but he
thought some kind of major change in the capitalist system was underway,
from the 70s onward and especially from 2001 onward. Because he was a
leftist and he believed in social cooperation, he looked for strands in
Japanese and Chinese historiography that might indicate a positive path
forward. He found it particularly in the work of the Japanese historian
Kauro Sugihara on the concept of the "Industrious Revolution" - as
distinguished from the industrial one. As he wrote in his last book,
Adam Smith in Beijing:
"Sugihara... conceives of the Industrious Revolution, not as a preamble
to the Industrial Revolution, but as a market-based development that
had no inherent tendency to generate the capital- and energy-intensive
developmental path opened up by Britain and carried to its ultimate
destination by the United States. Nevertheless, Sugihara's central
claim is that the instrumentalities and outcomes of the East Asian
Industrious Revolution established a distinctive technological and
institutional path which has played a crucial role in shaping East Asian
responses to the challenges and opportunities created by the Western
Industrial Revolution. Particularly significant in this respect was the
development of a labor-absorbing institutional framework centered on the
household (often, though not always, the family) and, to a lesser
extent, the village community. Against the traditional view that
small-scale production lacks internal forces for economic improvement,
Sugihara underscores important advantages of this institutional
framework in comparison with the class-based, large-scale production
that was becoming dominant in England. While in England workers were
deprived of the opportunity to share in managerial concerns and to
develop interpersonal skills needed for flexible specialization, in East
Asia [quoting Sugihara now] 'an ability to perform multiple tasks well,
rather than specialization in a particular task, was preferred, and a
will to cooperate with other members of the family rather than the
furthering of individual talent was encouraged. Above all, it was
important for every member of the family to try to fit into the work
pattern of the farm, respond flexibly to extra or emergency needs,
sympathize with the problems relating to the management of production,
and anticipate and prevent potential problems. Managerial skill, with a
general background of technical skill, was an ability which was actively
sought after at the family level.'"
Now, both Sugihara and Arrighi are clearly idealizing the Industrious
Revolution, and I am not so sure (at all) that you would find these good
things happening in the factories and supply-chains of Sony or the
Toyota Motor Company! But when I read your post, and when I read about
old Coase and his young Chinese collaborator dreaming about something
like a human economy, I thought of the paragraph above and of the
curious, arrested metamorphosis of capitalism that so many of us
imagined ourselves to be living through a few years back. All of this,
it seems to me, has a lot to do with your notion of markets and indeed,
of multiple forms of money as being crucial to the flowering of human
potentials. Indeed, Braudel as you know conceived of capitalism as the
anti-market, because it installs monopolies under military cover. Again,
this was a big idea during the utopian phase of Nettime, because of
Manuel DeLanda's pamphlet on Markets and Anti-Markets, inspired by
Braudel. We thought (and some of us still think) that the Net might help
to develop a much more open, horizontal, human-to-human production and
trading system... just as you thought in your book on The Memory Bank.
In short, a whole range of attempts to reformulate the Left around the
turn of the century were overwhelmed by the rollout of Neoliberal
Informationalism, as a mode of production and maybe more importantly, as
a form of financialized population management. But now all those things
have entered into a serious crisis, and the US seems finally to be on
the decline as the hegemonic power (not to mention Europe). Can we try
again, with greater attention to what's going on in other parts of the
world?
So anyway, just some ideas on a winter afternoon, in Chicago where
Milton Friedman did his thing.
best, Brian
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