Whither Now My America?

It's been a couple of days since the election, and I've let the disappointments sink in. In a lot of ways, this feels like 2004 all over again and in that I have some hope because things in many ways look brighter than they did during that dark election year. But I have to look around and wonder at the problems that my nation faces and the bizarre and unproductive electoral decisions that my fellow citizens have made in the face of those problems. My fear, and it's a very real one, is that the we have stood on the precipice of empire for too long and now the westward it has plotted its course and in its wake we have been left to drown for a good long while. I think that perhaps the American century has come to a close and what will happen now is that we will begin to settle into a long decline that remakes the face of global politics where the faults of our nation give rise to a new balance in the distribution of resources and global power that will need to account for the resurgence of Europe and new strength in India and China. That is probably a good thing in many ways. It's been clear for a while that the unitary superpower status that the United States held after the collapse of the Soviet bloc was something that was both unsustainable and that was just as bad for us as it was for the world living in our shadow. Where it's troubling is in the diminishment of American surplus and an over all decrease in the abundance that had sustained us for so long. In the end, I worry about what will happen for the weakest among us in the wake of a new austerity that will be imposed from without as much as we seem hell bent on imposing it from within.

A reactionary wave has seized an important part of the United States government and as a result the policies of our government over the next two years will not be what they should be. This matters because the next two years will be a crucial period during which the world will have to adjust to the new realm of global politics. I have hope because where Barack Obama and the Democrats have been completely inept in the domestic arena, the White House and the State Department in particular under Secretary Clinton have been making many of the right decisions geopolitically. In the next few years we will see a continuing diminishment of the adventure politics of neo-conservatism as the pragmatism of the Obama/Clinton era continues along its current course. The administration seems to be on a path to continually reign in the pressures coming from the rather childish pentagon which under the leadership of Secretary Gates has been more disinclined to want to go out into the world and play with all of its most expensive toys. And frankly a world stage where Europe and China in particular are a more potent force will be good for the United States as we will no longer be the sole focus of the ire of the rest of the world. I can see a new regionalism coming into focus where perhaps US foreign policy will be able to focus more on the development and improvement of the situation in Latin America because we will have pragmatic partners in Europe and Asia more able to take on the troubles in the Middle East and Africa. This is the upside.

The downside is that we have as a nation made the wrong decision about our domestic political economy. The heavy downturn that has come about as a result of the Great Recession has somehow gotten blamed on the Democratically controlled Congress and the White House making the right decisions on a number of fronts for which they have failed politically to support the good policy decisions that have been made. For some reason, the forces of Capital have set out to convince the American people that the recession is a result of deficit spending that needs to be reigned in and the American electorate once again showing themselves to be perpetual naifs about the most basic principles of political economy have bought it. They have put in power once again a group of politicians hell-bent on enacting policies which will only benefit the wealthiest of the wealthy, and even then only in the short term. And all of this out of vague fears of "socialism" and the loss of liberty caused by an overreaching federal government. This irrationality is nothing new. Historians of the Revolutionary War are in agreement that it lies at the foundation of the American experiment which started with a revolution against a more or less theoretical enemy that had not emerged so much as was merely threatening to appear at some point in the future. Still, as a member of the political movement that was largely repudiated by Tuesday's elections, I feel a need to restate and explain once again what it is that I believe in the perhaps vain hope that in doing so, come the next political cycle, the outlook won't be nearly so bleak.

It doesn't begin with Marx, but it might as well. I make no bones about calling myself a socialist because I am one and I have long grown tired of the grip that anti-Stalinist rhetoric and anti-liberal ideas have held on the American imagination. It's time, I think, for those who would decry a policy as "socialism" to have to make a stronger case than that as to why they oppose it. The reason for this is because such people have no idea what socialism is and even less of an idea about what it is about socialism that they don't like. For those who don't know, or who don't care to learn, I am going to attempt to make as clear a statement about it as is possible. Socialism is the simple idea that a society as a whole is invested with the economic power to constrain the excesses of capital markets which excesses are detrimental to the bulk of a society in favor at a small minority of wealthy capitalists. That's it. It has nothing to do with the elimination of private property (some socialists argue for that, others don't), the nationalization of industry by the state (some socialists are for, some are against), or the institution of a completely planned economy (again, some socialists are for, some are against). Socialism, in its essence, is the mere recognition of a few basic facts. Those facts are the existence of what Marx called "surplus value" and the inevitable effects of surplus value in a completely unregulated capitalist economy, and a recognition that political society is the sole locus of a power able to mitigate the damage unrestrained capitalism will inevitably do.

That damage is a result of the problem of surplus value. Classical economics makes a distinction between the market price of a commodity and the actual value of that commodity. Prices are set, according to Adam Smith, by the law of supply and demand. Where demand for a good exceeds its supply, prices will increase, where supply exceeds demand prices will fall. Ideally, this law will work in conjunction with other pressures in an economy to create a system where this equilibrium that markets tend toward is the same as the value of the good created. The value of the good here is agreed by all the classical economists from Smith and Ricardo through Malthus, Mill, and Marx to be the cost of bringing it to market. That is, the value of a good is how much it takes to produce it. It is the labor of workers making the thing plus the overhead costs of warehousing and transporting the commodity to the point of purchase. Marx's key insight, and the problem that capitalism has been forced to accept in the aftermath of his analysis, is that in an ideally functioning economy, therefore, there is no room for anyone to make a profit. Small profits might be made at the margins here and there through the forces of competitive production, where increased efficiencies reduce fixed costs like transport and allow one producer to undercut other producers and sell at a profit created by temporary efficiencies. But over time these efficiencies will tend toward equilibrium themselves. The only place that a profit margin can be found is in labor costs.

In a capitalist system, there will always be a minimum wage. It will be the minimum amount that a laborer requires to sustain him or herself. The price of food and shelter, at a bare minimum, in effect fix the low end that a capitalist can pay for labor. The reason for this is because labor itself is a commodity and the cost of bringing it to market, its value, is the cost of feeding and housing the laborer. So in a perfect capitalist system, the market pressures on labor will result in the price of labor being fixed at that amount. But there is a difference between the cost of labor and the cost of everything else that is involved in the production of goods, and that is that at the margins more labor can be got from a worker than is paid for. Which is to say, the cost of a laborer may be fixed but the number of hours that laborer works is not. Absent any controls, the capitalist will press his laborers to work longer hours than he is in fact paying them for, and this will create surplus value and his profit. The capitalist can do this because he owns the means of production and the laborer can't work without access to it. So the capitalist in fact converts this surplus labor into his profits. All the profits of a capitalist system are therefore born on the backs of the workers in that system being paid less than what the prices being paid at market would dictate the value of their output is. This is the core insight of Marx's political economy and it is unavoidable. So far as this particular fact about capitalism goes, all economists are Marxian.

Where the Marxian analysis of capitalism and other economists differ is in the effect that this system has. Marx believed that the pressures that this system creates are unsustainable over the long run, and that it would lead capitalism to an inevitable collapse. Much of the work that economists have done in the aftermath of Marx is an attempt to show how this isn't in fact the case and to adjust the model that Marx created of capitalism to account for things like growth, the availability of resources, and the impact of skilled labor on the system. The short version of all this work is that it's not at all clear that capitalism is unsustainable. Whether the faults of capitalism will lead to an inevitable collapse in fact remains to be seen. It does not remain to be seen, however, that several incidental facts that Marx predicted that the history of capitalist economics show to be true: periodic adjustments due to the excesses of capitalism will result in economic contractions and increased unemployment in what later economists now call the business cycle in which periods of growth and abundance are always followed by periods of recession and austerity. The business cycle is a fact. It happens. Accounting for it is the challenge of all macroeconomists who don't want to accept the Marxist critique of capital.

I don't care about that aspect of economics and neither does socialism. Socialism is a response to the fundamental unfairness that Marx, although not just Marx, exposed in the functioning of capitalism. That unfairness is rooted in the exploitation of workers by capitalists through the capitalist monopoly ownership on the means of production. It lies in the recognition that where enterprise is making a profit it is doing so on the backs of that enterprise's workers. Because ownership of the means of production is not labor. It creates nothing, it does nothing. And yet it produces massive profits for the class of economic actors who own the means of production, which profits are then not shared with the laborers who make it possible. That is an unfairness that lives in our system and that a rational society will work to alleviate. How it is alleviated is the corner stone of the theories behind socialism and organized labor, the bedrock principles of progressivism that are now under siege in American politics.

The socialist response can vary, all that is required for a socialist to be a socialist is the recognition that this is a problem and that society on the whole has a duty to do something about it to make the economy more fair. This doesn't have to be class warfare, but it does require sharing the wealth that is created by our system. There are all kinds of ways to do that, whether by progressive taxation like we have in the United States (although it's not progressive enough) or through the nationalization of resources and the means of production like Venezuela has done with her oilfields or Britain has done with various industries in the past, the BBC being probably the most visible example.

This desire for fairness, for the society to intervene in the economy by means of a republican government with the power to regulate commerce, is what has been repudiated in our political discourse as the "evil of Socialism." The counter intuitive nature of this repudiation is the great propaganda victory that capital has inserted into our political culture, to the point where now "socialism" is a dirty word used as an epithet by people who clearly don't understand what it means. This is what the talking heads shouting on the right call "evil." And the way that they have done that is by establishing a false equivalency between economic liberty and civil liberty. Because, and I'll be very clear about this, socialism is a restriction on economic liberty. All government is in fact a restriction on economic liberty. This is the core insight that leads anarcho-libertarians to their repudiation of all government. But think for a minute about what an economic liberty is: it is the ability to do some action in the pursuit of an advantage in the marketplace. There are all kinds of economic liberties that I think all of us are perfectly ok with not having. We don't have the economic liberty to defraud, to steal, to kidnap, to murder. These are all economic actions that are prohibited by government restrictions. Civil liberties, by contrast, things like freedom of speech, freedom of assembly, freedom of travel and the right to keep and bear arms are things that are sacred in our culture and rightly so. Reduced to it's most basic form, under our system of government all people have the right to participate in society in whatever way they see fit, to exercise their civil liberties as much as they wish, but they have severe restrictions on their participation in the market place because of the inequitable nature of that market place if left to its own devices. I would go even further and assert that the protection of civil liberties requires restrictions on economic liberties, because it's hard to say what you think if the bank can foreclose on your mortgage for saying it.

And yet, this equivalency is the foundation of the propaganda that says restrictions on economic liberties like environmental and labor regulations are in fact a reduction of the civil liberties that we actually care about protecting. The distinction here is crucial and makes all the difference, and yet it is continuously glossed over by pundits on the right like Rush Limbaugh, Sean Hannity, and Bill O'Reilly. This is the narrative that has convinced the tea party activists and the American right wing, who by and large are middle and working class americans whose economic interests would be served by socialism that the socialist threat to the top 1% wealthiest people in the country (and to be clear, socialism is a threat to those people because their wealth is a result of the exploitation that socialism seeks to counter), that their interests are actually threatened by left wing economic policy, ie Socialism.

This is the story of American politics this year, and it's irrationality is, in this sense, easy to understand. It is a propaganda victory that has happened because the people who should be opposing it, the people who are sympathetic to socialist policies, have rolled over and let it happen. Rather than trying to make clear the distinction, and showing how the pundits on the right are lying bastards who do not care at all about liberty, they trot out to moderate positions and spend most of their time trying to explain how they aren't in fact socialists. ANd they aren't. The Neo Liberal pro-business leftism that characterized Bill Clinton's administration and has guided the leadership of the Democratic party over the last 20 years was not socialism, it was a milquetoast philosophy that accepted a set of propositions as fundamental that inevitably lead to right wing policies if unchallenged. It is incoherent, and it was adopted as an expedient to distance the moderate left from the real left in American politics in a misguided attempt to dodge the right wing propaganda that all socialism leads inevitably to Stalinist communism and the attendant curbing of civil liberties that come along with that style of planned economy. Nothing could be further from the truth, of course, as can be seen in the very free and open society that is enjoyed by heavily socialized economies in Europe. But by playing into this propaganda machine for the last thirty years, ever since Reagan ousted Carter in 1980, the political establishment of the American leftwing have left themselves without the means to counter the propaganda of their opponents, and the result is the historic disenchantment with both political parties that is currently exhibited in the polling but that never the less has lost democrats the House of Representatives and has seen the rise of a right wing movement in America that is as incoherent as it is angry and engaged in politics.

So what's the answer for the left? It's to double down on what we believe in. To acknowledge socialism as a fundamental protection of American liberty and to fight back against the mischaracterization of our beliefs by the right who serve at the pleasure of robber baron style capital. It will take a long time, and honestly I think that we have begun to see the stirrings of it in the progressive movement that was born out of the failure of 2002 and 2004 to place limits on the rampant pro-capital government of George W. Bush and the congress that moved in lockstep with him. The 2010 midterms saw far more losses for "blue dog" conservative democrats than it did for true progressives. For every Russ Feingold who lost on Tuesday, there were two Blanche Lincolns. For every Alan Grayson there were four Ben Nyes. And now we are in a position where we are somewhat out of power, particularly in terms of the federal budget, and that puts us in an excellent position to demand that the right puts up or shuts up with its disastrous economic policy. Now is the time to reclaim the birthright of the American left in its pro-labor, pro-civil rights, anti-capitalist roots and begin building a stronger movement for the elections to come. Because the winds shift quickly in American politics, and before long it will be our turn again. When we get it, we need to have learned the lesson of the past few years and not let the reactionary forces of the economic elites drag us back down again.