Home > Uncategorized > Ecological limits and hierarchical power

Ecological limits and hierarchical power

from Blair Fix, Shimshon Bichler and Jonathan Nitzan

Nowadays, it is commonplace to claim that the economy overuses our limited material and energy resources (Figure 1) and that this overuse threatens both human society and the biosphere. Other than ant-science cranks, the only ones who seem to deny this claim are mainstream economists (Fullbrook 2019).

In our view, though, this conventional condemnation of the economy is somewhat misleading. As we see it, the root of our ecological problems lies not in the ‘economy’, but in the hierarchical power structure of capitalism.

  1. Hierarchy as a Means

In his PLOS ONE article, ‘Energy and Institution Size’ (2017), Blair Fix shows that per capita energy capture (or energy use) is positively and often tightly correlated with organization size, both corporate and governmental: the larger and more hierarchical the organizations in a society, the greater that society’s capture of energy per person.

This positive correlation is evident in the U.S., where time-series data go back to the late nineteenth century (Figure 2).

And the same positive correlations – using time-series/cross-section data – are also evident internationally (Figure 3)

Fix’s explanation for this positive correlation emphasizes ‘economies of scale’ (Figure 4). Higher energy capture, he argues, demands increasingly complex coordination. Human beings, though, are limited in their natural ability to organize in larger groups. According to Robin Dunbar (1992), the size of the human neocortex makes it impossible to maintain stable personal connections with more than 150 people, give or take (Dunbar’s Number).

The historical solution to this coordination problem is hierarchy (Turchin and Gavrilets 2009). In a hierarchy, each person has a limited number of personal connections – one superior above and a few subordinates below. The modular nature of these connections makes it possible to combine them into huge vertical organizations of almost any size (think of a country like China).

From this viewpoint, hierarchical power is a means of harnessing more energy. Societies that wish to increase their standard of living can do so only by accepting more hierarchical power structures. Without such vertical structures, they would be unable to coordinate on a scale large enough to harness the energy they need.

  1. Hierarchy as a Goal

But there is a flip side to this argument. In their paper, ‘Growing through Sabotage: Energizing Hierarchical Power’ (2017), Shimshon Bichler and Jonathan Nitzan argue that much of the energy harnessed by hierarchical societies does not go to wellbeing at all, but rather to building, fortifying and sustaining power hierarchies as such (Figure 5).

The starting point of this argument is that capitalism is best understood not as a mode of production and consumption, but as a mode of power (Nitzan and Bichler 2009). According to this view, the power of a capitalist or a group of capitalists is quantified by differential capitalization – namely, by the size of a group’s capitalization relative to the capitalization of other groups or entities (for example, the ratio of Amazon’s capitalization to Google’s; FAANG’s to the S&P 500’s; the top ten global integrated oil companies’ to Datastream’s world aggregate of all firms; the S&P 500’s to the U.S. population’s average, etc.).

From this perspective, capitalists are driven to augment their power for the sake of power – a quest that leads to a never-ending differential race to erect larger and larger hierarchical organizations, regardless of whether these organizations are more ‘effective’ capturers of energy.

Moreover, the build-up of hierarchical power elicits resistance from those who are subjected to this power, which in turn drives capitalists to build even more hierarchies in order to limit and contain that resistance.

For our purpose here, the key points of this flip argument are that (1) building and sustaining hierarchies requires plenty of energy; (2) the proportion of energy devoted to sustaining hierarchy tends to increase over time; and (3) a large and growing share of our energy use as a society has little or nothing to do with the wellbeing of the population[1]

 

  1. It’s Not the Economy, It’s the Hierarchy

This thinking raises an interesting possibility. What if the recent exponential growth of energy capture (Figure 1) is caused not by ‘economic growth’, but by the growth of hierarchical structures? In this case, achieving sustainability would require dismantling the capitalist hierarchies that dominate us[2]

Whether these hierarchies can be undone – and before it is too late – is of course a different question altogether.

 Endnotes

[1] These claims should not be confused with David Graeber’s notion of ‘bullshit jobs’ (Graeber 2018). Whereas Graeber identifies the rise of meaninglessness and waste, Bichler and Nitzan emphasize the fortification and extension of differential power. On the difference between wasteful spending and investment in differential power, see Bichler and Nitzan (2017, Section 12.3)

[2] We are speculating here that the expansion of hierarchical power drives the growth of energy. Even if the causal direction is reversed (the need for more energy requires more hierarchy) or is circular (energy and hierarchy drive each other), the need to dismantle hierarchy still seems plausible. If the energy-hierarchy correlation remains positive, a world that uses less energy is likely to be less hierarchical.

References

Bichler, Shimshon, and Jonathan Nitzan. 2017. Growing through Sabotage: Energizing Hierarchical Power. Working Papers on Capital as Power (2017/02, July): 1-59.

Dunbar, R. I. M. 1992. Neocortext Size as a Constraint on Group Size in Primates. Journal of Human Evolution 22 (6, June): 469-493.

Fix, Blair. 2017. Energy and Institution Size. PLOS ONE 12 (2, February 8): 1-22 + appendices.

Fullbrook, Edward. 2019. Economics 101: Dog Barking, Overgrazing and Ecological Collapse. Real-World Economic Review (87, March): 33-35.

Graeber, David. 2018. Bullshit Jobs. First Simon & Schuster hardcover ed. New York: Simon & Schuster.

Nitzan, Jonathan, and Shimshon Bichler. 2009. Capital as Power. A Study of Order and Creorder. RIPE Series in Global Political Economy. New York and London: Routledge.

Turchin, Peter, and Sergey Gavrilets. 2009. Evolution of Complex Hierarchical Societies. Social Evolution & History 8 (2): 167-198.

  1. Ikonoclast
    April 8, 2019 at 10:54 pm

    1. The text links do not work but the reference links do work.

    2. On the issue of hierarchies and management fads, I noticed that re-organizations in my bureaucracy were popular with managers. I think ordering re-organizations gave them something to do. Functionally, it acted as a reassertion and reminder of their power. Nothing says “I have power over you” better than ordering someone to do something useless. I guess it’s the same as ordering holes to be dug and filled in again. We need to remember that such hierarchical nonsense is not only the preserve of government departments. It’s just as powerful in corporate hierarchies. The graphs in the article bear this out.

    3. Notwithstanding the costs of hierarchy, the full dismantling of hierarchy could lead to anarchy. When I think of anarchy I think of warlord-ism not peaceful co-existing communes. I tend to think that is where matters could lead in a breakdown situation. The salient issue perhaps is how to flatten hierarchical structures without removing them completely. A consideration of powers of ten illustrates that an organization of 10,000 only needs 4 hierarchy levels or maybe 5, if each person manages 10. Could it be that simple?

    • April 9, 2019 at 1:05 am

      2. Your point here is similar to that of Graeber in his book “Bullshit Jobs”. The claim in “Growing Through Sabotage” is different. Hierarchies, we argue, are not there only to flatter those who control them. They are there to maintain and augment their power. In this sense, the cost of capitalist hierarchies should be viewed not as waste, but as an investment in capitalized power.

      3. The flattening of hierarchies can occur either through the decline of the mode of power (which you refer to as anarchy), or through democratization. In terms of our “hierarchy-energy space”, or hes, the former is described by Trajectory D; the latter by Trajectory C. See: https://twitter.com/BichlerNitzan/status/1112347573740883968.

      • Ikonoclast
        April 9, 2019 at 3:08 am

        2. I agree on point two. The Graeber viewpoint can be the limited perspective of the worker. The worker feels frustration when arbitrarily ordered to do things which he/she sees are pointless from the functional viewpoint of getting the real work done.

        3. I think a steep trajectory D would end in anarchy, at least until populations adjusted through collapse. Trajectory D is a crash landing. Trajectory C is the desirable trajectory, of course, and in a sense is a controlled emergency landing.

  2. April 9, 2019 at 1:58 am

    Sociocracy is an interesting variation on hierarchy in which information flows both down and up and, in my understanding, leadership is distributed through the organisation. See the book We the People:
    https://www.sociocracy.info

    Thanks for the column. It fits my growing perception that command hierarchy has been intrinsic to ‘civilisation’ (living in cities) from the beginning 6000 years ago. See two books called Against the Grain, one by James C. Scott on early states, the other by Richard Manning on how domestication serves the powerful and limits our lives. Oh and Daniel Quinn’s Beyond Civilization.

  3. Ikonoclast
    April 9, 2019 at 3:12 am

    Professor R.D. Wolff’s call for Democracy in the Workplace or Democracy at Work is relevant here. I will leave people to search the net for those terms.

  4. April 9, 2019 at 3:25 am

    I think I erroneously switched the descriptions of the two trajectories. So let me try to get it right (see also this summary table: https://twitter.com/BichlerNitzan/status/1112348367676473344).

    Trajectory C: Declining Mode of Power.

    In this trajectory, overall energy capture per capita, livelihood energy per capita and the share of energy going to hierarchy are all falling. This trajectory is likely to be associated with MOP disintegration and societal decline.

    Trajectory D: Democratizing Mode of Power.

    Here livelihood energy per capital is rising, while the share of energy going to hierarchy is falling. With these given, we can further distinguish between two sub-trajectories: D1, in which overall energy per capita is rising (eventually unsustainable) and D2 in which overall energy per capita is falling (possibly sustainable).

  5. EDWARD K ROSS
    April 9, 2019 at 9:49 pm

    From the point of view of a person who has both experienced employment where one is treated as an ignorant slave without the ability to think and other positions such as working farm manager and later sales rep. I THINK the above blog and posts deserve a lot more consideration in order to understand how people think and are motivated, and reflect te community and cultural groups they live and work in.Ted

  6. DJ
    April 13, 2019 at 11:56 am

    If hiearchy and energy per capita is tightly correlated, D1 is highly unlikely . D2 is best we can hope for, B2 proposed by ecofascist worst.

  7. Ken Zimmerman
    April 18, 2019 at 3:45 am

    Shimshon Bichler and Jonathan Nitzan are Israeli political economists. Together they’ve created a thought-provoking power theory of capitalism and theory of differential accumulation. The theory is not “pie-in-the-sky,” but is based in their analysis of the political economy of wars, globalization, etc. The theory is not something new, however. It reflects the works of Thorstein Veblen, Karl Marx, Michał Kalecki, Cornelius Castoriadis, and Lewis Mumford. Considering the foci of their research and the works they use as a starting point, neither Bichler nor Nitzan can be called economists, in the way that identifier is used today. They share, for example Veblen’s claim that business exists with the end of pecuniary (monetary) gain and not the accumulation of goods of consumption or of physical machines, or (no matter the advertising) the wellbeing of patrons. According to their power theory of value (introduced in their Capital as Power: A Study of Order and Creorder, published 2009), “neoclassicists separate economic life into ‘real’ and ‘nominal’ domains. Of the two, the real sphere is primary, the nominal secondary. The real sphere is where production and consumption take place and relative prices and distribution are determined. The nominal sphere is the domain of money and absolute prices, and it both lubricates and reflects the input–output processes of the real economy. At the root of this duality lies an attempt to justify capitalist profit and wealth. The liberal claim – first voiced in the European city-states of the thirteenth and fourteenth centuries and later formalized in John Locke’s Two Treatises of Government (1690) – is that private property emerges from one’s own labour. This claim makes the bourgeoisie unique: earlier dominant classes looted their wealth and therefore needed religion to sanctify it; the capitalists, by contrast, produce their wealth with their effort and hence have a natural right to own it.” In other words, today’s dominant class, capitalists “earn” their wealth, while those before them stole it, generally by force of arms. But capitalists also steal their wealth by writing the “rules of wealth” and then convincing (mostly by propaganda and control of the media and institutions of formal education) that these rules are “true” and all of us should adhere to them.

    Of those cited by Bichler and Nitzan Veblen is particularly instructive. “For Veblen, industry and business are two increasingly distinct spheres of human activity. Industry constitutes the material context of capitalism, although industry is not unique to capitalism. When considered in isolation from contemporary business institutions, the principal goal of industry, its raison d’être according to Veblen, is the efficient production of quality goods and services for the betterment of human life. The hallmark of industry is the so-called ‘machine process’, a process that Veblen equated not merely with the use of machines, but more broadly with the systematic organization of production and the reasoned application of knowledge. Above all, Veblen accentuated the holistic nature of industry. The neoclassical emphasis on individualism and its Robinson Crusoe analogies of the innovative ‘entrepreneur’ and single ‘consumer’ are misleading myths. The machine process is a communal activity; its productivity derives, first and foremost, from cooperation and integration. The reasons are both historical and spatial.” “…business differs from industry in both methods and goals. Business enterprise means investment for profit. It proceeds through purchase and sale toward the ulterior end of accumulated pecuniary wealth. While industry is a manifestation of the ‘instinct of workmanship’, business is a matter of ownership and power; whereas the former requires integration, cooperation and planning throughout society, the latter depends and thrives on conflict and antagonism among owners and between owners and the underlying population.” As Bichler and Nitzan make clear there is little that business will not use to get a profit. This includes absentee ownership, finance and credit, and police enforcement as power mechanisms of capitalism. Like Veblen, Bichler and Nitzan ponder the implications of power – or ‘sabotage’, as Veblen called it – for the notion of capital.

    Bichler and Nitzan get into the details of how “capitalization” is used to deny climate change in their article, ”How to use capitalization to minimize the cost of climate change and win a Nobel for ‘sustainable growth.’” The title says it all. William D. Nordhaus won the Nobel prize in economics for a climate model that minimized the cost of rising global temperatures and undermined the need for urgent action. Nordhaus’ “racket” created low-ball estimates of the costs of future climate change and high-ball estimates of the costs of containing the threat contributed to a lost decade in the fight against climate change, lending intellectual legitimacy to denial and delay. At any time t, the present value (PVt) of future climate change — or, in plain words, the cost to society if it were to bear the brunt of climate change at time t rather than in the future — involves two separate considerations: (1) the estimated cost to be incurred n periods into the future (Ct+n), and (2) the discount rate at which these costs are to be brought back to present value (r). Nordhaus “monkeyed” with both. Vastly overestimating the costs to manage climate change today and underestimating the future cost of climate change effects with a phony-up discount rate. Nordhaus does not have the credentials to achieve the first and can achieve the second only indirectly through an absurd discount rate of 6%. At this rate the present value of $100 of climate change cost incurred 100 years from the present is less than $0.25. So, why act today? It cost us (the planet of us) little to nothing to wait another 20 or 30 years, or even longer. “The nice thing about these discount-rate ‘adjustments’ is that, unlike the commotion stirred by debates over the actual cost of climate change, here there are no messy quarrels with scientists, no raised eyebrows from journalists and no outcries from the cheated public. Only contented politicians and delighted capitalists. This was it seems Nordhaus’ plan all along.

    • Robert Locke
      April 18, 2019 at 2:10 pm

      As an historian I have always found Veblen’s distinction between business and industry appealing, because of its explanatory power when dealing with questions like hierarchical organizations. People have short memories, until the 1970s, studies of the rise of managerial hierachies abounded, which were associated with mass production U.S capitalization and the financialization of the economy. But I can remember very prolonged discussions about how this system of firm governance collapsed through its inability to stand up to the competition posed by cooperative firm management, power sharing within the group, and the efficiency it engendered. The literature is abundant, although mostly ignored on this blog. I have spent my life examining the educational structures that have accommodated with the business and industrial forms of management; if one considers, for instance, the integrated nature of local government, with training, and education in a German region, the U.S business school hierarchical model is destined to collapse because of its economic inefficiency. Whatever social “scientists” say.

      • Ken Zimmerman
        April 20, 2019 at 12:39 pm

        Robert, Veblen’s “The Theory of the Leisure Class” is even more relevant for events over the last 100 years. But this and most other Veblen research and writing have been systematically buried. Thorstein Veblen’s working life — from 1890 to 1923 — overlapped with America’s first Gilded Age, so named by Mark Twain, whose novel of that title lampooned the greedy corruption of the country’s most leisurely gentlemen (all men). Now, well into America’s second (bigger and better) Gilded Age, in a world of overwhelming inequality, Veblen’s insights come back to haunt us. A brilliant student and scholar, Veblen studied anthropology, sociology, philosophy, and political economy (out-of-date for what’s now called economics). When Veblen studied economics, he, like most economists was concerned with the actual conditions of ordinary human beings. None would have settled for data from a sham “free market.” Veblen’s first job was at the University of Chicago, the university bought and paid for by John D. Rockefeller the classic robber baron, and leader of the leisure class. Rockefeller called the university “the best investment” he ever made, since he intended to use it to advance the interests of his class and suppress opposition. Still, from the beginning, Thorstein Veblen was there, prepared to focus his mind on Rockefeller and his cronies, the cream of the upper class and the most ruthless profiteers behind that Gilded Age. Veblen asked the basic questions any anthropologist would ask. Questions once again in the forefront today. How had such a conspicuous lordly class developed in America? What purpose did it serve? What did the members of the leisure class do with their time and money? And why did so many of the ruthlessly over-worked, under-paid lower classes tolerate such a peculiar, lopsided social arrangement in which they were so clearly the losers? Veblen addressed these questions in “The Theory of the Leisure Class,” published in 1899. Veblen showed no animus for or against a leisure class. It is his affair simply to find out how and why and what it is. If the book leaves the reader angry, upset, or uncertain about how America works, that seems to be solely the effect of the facts Veblen presents. Oh, to have another Veblen today to pull aside the curtain and reveal the world of smug, witless plutocrats like the one now in the White House, bankers and even worse large corporation, hedge fund and private equity fund CEOs paid billions of dollars per year. All busying themselves with nonproductive consumption of time. Time is consumed non-productively “(1) from a sense of the unworthiness of productive work, and (2) as an evidence of pecuniary ability to afford a life of idleness.” This “Leisure Class” looking down its collective nose at the laboring masses, was all around Veblen in 1899 as it is once again today. Veblen revealed many examples of cooperative, peaceable cultures that had supported no such idle class at all. As well as class-ridden cultures that saved upper-class men for the “honourable employments”: governance, warfare, priestly office, or sports. Such arrangements prompted aggressive, dominant behavior that, over time, caused societies to change for the worse. Indeed, those aggressive upper-class men soon discovered the special pleasure that lay in taking whatever they wanted by “seizure,” as Veblen termed it. Such an aggressive way of living and acting, in turn, became the definition of masculine “prowess,” admired even by the working class subjugated by it. By contrast, actual work – the laborious production of the goods needed by society — was devalued. “The obtaining [of goods] by other methods than seizure comes to be accounted unworthy of man in his best estate.” Such constant “predation,” soon became the “habitual, conventional resource” of the parasitical class. This is the history of how a more peaceable, communal existence had evolved into the grim, combative industrial age in which he found himself: an age shadowed by predators seeking only profits and power and putting down any workers who tried to stand up for themselves. This was not merely a “mechanical” change, but a spiritual transformation said Veblen.

        Rough as this was on people like Rockefeller, it was probably the 14th and last chapter that got him fired from Rockefeller’s university: “The Higher Learning as an Expression of the Pecuniary Culture.” And some wonder today why economists and other academics are sometimes reluctant to attack the predators sucking our blood today and paying their salaries!

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