[עריכה] Power is external to society

The turning point came at the end of the nineteenth century. Recall that classical political economy differed from all prior myths of society in that it was the first to substitute secular for religious force. But note also that this secular notion of force was similar to its religious predecessor in that it was still heteronomous [wikipedia]. It was external to society. For the political economist, economic forces were as objective as natural laws. They were determined for human beings, not by human beings.

[עריכה] Power as a human phenomena

This external perception of force began to crack during the second half of the nineteenth century. More and more processes seemed to deviate from the automaticity implied by the natural laws of economics. Increasingly, force was subjectified by society, seen as determined for human beings, by human beings. Challenged and negated, heteronomous force gradually re-emerged as autonomous power.

[עריכה] The rise of governments and big business

The change in perception was affected by several important developments. First, the rise of large governments and big business undermined the Newtonian logic of competitive markets and political equilibrium. At the turn of the twentieth century, it was already clear that the guiding hand of the market was not always invisible and that liberal politics was far from equal. Power now was much more than a theoretical addendum needed simply to ‘close’ an otherwise incomplete economic model; it was an overwhelming historical reality, one that seemed to define the very nature of capitalism. This recognition cast further doubt on the possibility of purely economic categories.

[עריכה] Empirical test of theory

Second, the emergence of the aggregate view of the economy,the development of national accounting and the requirements of statistical estimates revealed serious difficulties with the measurement of capital. For the first time, political economists had to put the concepts of utility and abstract labour into statistical practice, and the result was disastrous.

According to received doctrine, the ‘real’ quantity of capital is denominated in units of utility or abstract labour. But there is a caveat. As we shall see later in the book, such measurements are meaningful, if at all, only under conditions of perfectly competitive equilibrium.

This qualification creates a bit of a headache since, by definition, perfectly competitive equilibrium evaporates when infected by power. And given that even orthodox economists now agree that power is everywhere (if only as a ‘distortion’), it follows that the theoretical units of ‘real’ capital are meaningless and that their practical measures break down.

In fact, it turns out that even when we assume perfectly competitive equilibrium it is still logically impossible to observe and measure the utility or abstract labour contents of capital. And so, by attempting to measure the so-called ‘real’ quantity of capital, economists ended up exposing it for what it was: a fiction hanging by the threads of impossible assumptions and contradictory logic.

[עריכה] Contradicting the cyclical patterns

Third, and more broadly, the new reality of the twentieth century didn’t quite fit the traditional way in which liberals and Marxists separated [p. 43] economics from politics. There was a massive rise in the purchasing power of workers in the capitalist countries, an uptrend that contradicted the cyclical patterns suggested by Malthus, Ricardo and Marx, and that therefore blurred their basic notion of ‘subsistence’.

Many types of labour became complex and skilled, rather than one-dimensional and simple as Marx had anticipated – a development that made the notion of ‘abstract labour’ difficult if not impossible to apply. And in contrast to the expectations of many radicals, profit cycles failed to implode capitalism, while the profit rate – although oscillating – trended sideway rather than down.

[עריכה] Culture, media, consumerism, technology, corporate planning and public management

Culture, media and consumerism became no less crucial for accumulation than production was. Inflation supplemented cost cutting as a key mechanism of redistribution, while finance took over the factory floor as the locus of power. Emerging categories of technology, corporate planning and public management could not easily be classified as either economic or political. It became increasingly clear that free competition and bourgeois ownership were insufficient, even as a starting point, to explain the nature and development of modern capitalism.

[עריכה] The "social class" as a speculative concept

The very notion of class became contested. As an analytical tool, class originally emerged from a triple fusion of Ricardo’s theory of labour value, Comte’s industrial management and Marx’s capital accumulation. The emphasis of class analysis on capitalists and workers was unmediated and obvious; it was materially embedded, ideologically accepted and legally enforced; and until the late nineteenth century it served both the liberal mainstream and its Marxist critiques.

But by the early twentieth century, the vision of class analysis had become blurred. Although still linked in some sense to material reality, class was now increasingly intertwined with political organizations and parties, culture, mass psychology and sociology. It was no longer immediate or obvious. It required subtle articulation. It became a speculative concept.

[עריכה] Emerging of the masses

Worse still, class was now competing with new concepts, particularly the ‘masses’.

The twentieth century brought fascism, a new regime that rejected the Enlightenment, cast off rationalism and shifted the entire ideological emphasis of social theory. Instead of production, fascism accentuated power; in lieu of class, it spoke of state, organization and oligarchy.

Following fascism, social scientists began to emphasize a new set of categories – ‘mass’, ‘crowd’, ‘bureaucracy’, ‘elite’ and, eventually, the ‘system’ – categories that appeared more flexible and better suited to the changing times than the rigid and anachronistic class demarcations of political economy.

[עריכה] From mechanical cosmology to uncertainty, risk and probability

Fourth and finally, the objective–mechanical cosmology of the Newtonian and liberal revolutions started to fracture. In its stead came an indecisive worldview of uncertainty, risk and probability, of relative time/space, of an unsettling entanglement of particles and of a rather hazy separation between observer and reality.

[עריכה] From science to postism

These developments have been used to justify further movements away from the scientific–universal principles of political economy. Vitalism, ethnic identity and racism have all flourished in the name of cultural pluralism. Anti-scientists have challenged the so-called [p. 44] binary ‘essentialism’ of ‘Eurocentrism’. Lord Bacon was dead [who is Bacon?]. Ignorance has become strength.

[עריכה] Uncharted territory

Suddenly, power was everywhere, and it contaminated everything. The anonymous market, measurable capital and class have all become suspect. The old categories seemed to be melting, along with the determinism that held them together. Political economy had entered a new, uncharted territory.

[end of chap 3]