Home > Uncategorized > The crooked timber of history

The crooked timber of history

from Peter Radford

I was lucky enough last week to meet a few friends for the first time in person since the pandemic swept all before it.  We are an eclectic group with more than a fair influence of Wall Street.  Given all that is going on, and has gone on since we last met face-to-face, I expected to be drawn into endless political discussions.  But no, we spent a majority of our time talking about how the pandemic has accelerated the current wave of technological change.  At one point someone asked whether there were lessons from the Industrial Revolution that we could apply to where we are now.  Our conversation evolved from there.

Near the end of the introduction to his history of the British experience between 1700 and 1850 Joel Mokyr gives us his abbreviated perspective on the key ingredients of what he calls the “economic game”:

“The economic game is played at two levels: the level of a game against Nature (technology), and a game of interacting with other people (institutions).  Stripped to its barest essentials, the game against nature is not a social game — though in any practical historical situation it was of course mixed up with social elements. Technology is always and everywhere about utilizing natural phenomena and regularities to extract from Nature something she does not willingly give up.  Production involves harnessing these regularities to further human material needs.”

This is on page twelve of a book that then goes on to span nearly another five hundred pages, but the meat of the discussion is all there.  Somehow a combination of technology and institutional evolution created the conditions for the extraordinary acceleration in human well-being we associate with the industrial era now ending.

Any graphic depiction of the two hundred years or so since are extraordinary for the suddenness of the change.  We are living at the vertiginous end of a series of changes that eradicated the prior way of life and re-ordered society to accommodate itself to its new technological milieu.

There is, of course an endless scholarly debate about whether social change begat the technological change or vice versa.  Like all such debates there’s merit on both sides.  The reality, as experienced by those living through the revolution, was surely a bit of both.  Simple things like timekeeping became much more urgent and pervasive than they had been.  Old Medieval towns took a great deal of pride in the clock in the town square.  Wealthy households had clocks as novelties.  But after the revolution the factory whistle became the familiar organizing principle for the vast horde of newly created industrial workers.  We have not looked back since.

Back in the early days of the revolution what became known as the “machinery question” swept its way through influential debating and discussion parlors the length and breadth of Britain.  Clearly something was going on.  Quite what was uncertain.  Machines loomed large both in the new industrial landscape and in the mental images observers had of the world ahead of them.  What we now call economics was invented in the midst of the storm to try to make sense of the suddenness of the changes.  Millenia of relative calm were being displaced by who knows what?  The social order was being re-written.  Both the landed gentry and the workers flooding into the smoke ridden world of the new cities were, for different reasons, resisting the change.  And national political agendas were being shaped to favor the rising industrial class.  Power was shifting.  Everyone sensed it.  No one quite understood it.

The immediate impact on the mass of the new working class was to reduce their standard of living.  Life expectancy dropped.  Health deteriorated.  Urban poverty replaced rural subsistence.  And the rigors of a lifestyle dominated by the rhythm of machinery overtook the entire prior social system.  Nonetheless the change took place.  The politicians ensured that it did.  And, eventually, society melded into the new world. We embraced industrialization so firmly that we now decry its passing as digitization takes over.

The arrival of new technology does not simply re-write the workplace.  It can, if it is general and useful enough, re-write everything.

So, the question my friends and I were asking ourselves is not a new one, but it is still pressing: is artificial intelligence, and its coterie of related digital instances, a general enough technology to do what the various industrial technologies did a couple of hundred years ago?  Are we in the midst of a total reconstruction of society?  If so, who is in charge of that reconstruction?

One of our frustrations is the glibness of economists who simply argue that in the long run the current dislocation will be justified by the gains in prosperity.  They rely on history.  Or, rather, a particular reading of history.  They tell us that in the end the entire population will benefit from the bounty bestowed on us by the digitization of everything.  Productivity and efficiency will rise beyond currently imaginable levels.  The need for irksome labor will fall away.  Factories will be hives of robots attended by a handful of highly paid technicians.

And if we ask about all the other workers who are no longer needed in the factories?  Silence.

This is, naturally, an old question too.  Our economy has long since been dominated by employment outside of factories.  Our obsession with robotic production lines is a reflection of our slow realization of the changes that went on years, if not decades, ago.  Digitization is upon us.  And like our forbears we have no idea where it is leading us.

The depth of the change is abundantly clear.  Our language is adapting to the digital world.  So is our workplace.  The unscrupulous pursuit of shareholder value lurks behind the early manifestations of the new technologies.  Perhaps we can give some of the “disrupters” — that pompous self-aggrandizement is sickeningly indicative of their intent — some element of the doubt.  Perhaps they feel that the technologies that they foist upon us are genuinely socially improving.  Ride-hailing for instance allows us to avoid the wait for a taxi.  That sounds nice.  Until we realize that it is a stalking horse for “dis-intermediating” a well established livelihood and is intended to separate taxi drivers from the costly benefits that their old workplace gave them.  Those drivers are now “subcontractors” not employees.  Only employees need benefits.  Sub contractors are self employed entrepreneurs, so it’s up to them to provide their own benefits.  And the saved cost flows uphill to the investors who prop up the ride hailing business and its technological marvels.

Inequality widens as a result.

The utopian visions of the technology proselytizers, who seem to congregate at institutions of either high education like Stanford and M.I.T., or high finance like our forest of hedge funds and banks, tell us that change is inevitable.  Job transformation is the way of the future.  We need to embrace the new technologies or risk being labeled as “Luddites”.  Workers will need to educate themselves to remain “relevant” in the new workplace.  Otherwise they will be swept away by the tide of bits and bytes streaming from Silicon Valley and other hives of disruption.

As you know, I am deeply skeptical of expressions of utopian perfection.  There is no such thing.  Kant’s reference to crooked timber resonates too clearly as I contemplate our moment.  I am left to ask questions.

Is the tide of technological change inevitable?  We have been trained to think it is.  The machines of the late 1700s threw us into a turmoil that took two hundred years to absorb.  Entire social and political systems had to be re-cast to accommodate the technology.  Society had to be trained to accept change.  Once it did, change became the norm.  Yes, we are better off because of industrialization and its consequences, but the struggle to spread the gains was long and hard.  We had to create modern democracy in order to assure ourselves that the owners of technology would not plunge us all into feudal subservience.

Are we going to have to re-fight those wars?  Of course.  This new wave of technology has been unleashed on the back of the mid-twentieth century turn to unfettered market capitalism.  Democracy was diminished purposefully to free up the flow of profits rising to the top.  The natural alliance of right wing economics, corporate interests, and conservative politics produced the current inequality.  A new layer of technologic upheaval will only make matters worse.

Unless.

Unless we recognize the lessons of history.  Our advantage this time is that we have seen this before.  We know what to expect.  Society will need rebuilding to absorb the technology.  Technology will need amending to fit into society.  The old debate about which is more influential on the other, technology or society, needs to be brushed off anew.

As for artificial intelligence: it isn’t a technology in itself.  It is a catch-all phrase that references a number of digital avenues of innovation.  It is more an ideological identity than an economic one.  It is a pronouncement of an intention to re-alter society and the precarious balance of power between the citizenry and the owners of the technology.  We will have to guard against the excessive self-belief and fiscal might of its owners, and refurbish our defenses against their inevitable attempt to seize social and political power.  We can outsource the development and exploitation of technology to the disrupters.  But we must retain the apportionment of the gains from their efforts to ourselves.  Democracy must win.

The machinery question is back with vengeance.  This time we ought to be ready, for, if I remember my Kant correctly: “Out of the crooked timber of humanity no straight thing was ever made”.

  1. April 2, 2021 at 10:00 am

    ” This time we ought to be ready”? It was ever thus: back even in the Bible story of Creation.
    Parents want the best for their children, but in seeking independence children sometimes think they know better than their parents, not yet having experienced what can go wrong.

  2. Ikonoclast
    April 2, 2021 at 11:10 am

    In a world of technological progress, but of ecological, climate and social regress, we might not expect that there should be investment opportunities that yield a positive financial rate of return. Such returns after all would be unrealistic relative to real trends. This is If finance is supposed to reflect the real. When I use the word “real” like this I refer to real systems (or sub-systems thereof) where quantities can be measured in scientific dimensions; in SI Units (International System of Units). Measuring in anything else is a ticket to fantasy land. In other words, I am saying if financial returns are positive (overall) while real systems and real stuff in real systems are declining (in quantity, quality and/or “serviceability”) then the gap between the fictitious and the real (between finance and real stuff) is becoming ever wider and thus more farcical and fantastical in character.

    Placing the emphasis on measuring, equating and managing fictitious “stuff” (quantities of the numéraire) at the expense of measuring and managing real stuff is the profound mistake at the heart of classical and neoclassical economics. The core attempt in finance and orthodox economics, utilizing the numéraire, is to equate disparate real things by making the incommensurable commensurable in the fictitious (social-fictive) dimension of the numéraire. Ontologically, this procedure is fundamentally flawed and doomed to failure. The failure it is doomed to is precisely the crisis we see developing with ominous inevitability. We cannot sustainably manage real systems by this method. We destroy biosphere and climate but by jingo the numbers in the fictitious dimension look good, albeit for the rich only.

    A proviso must be placed on the above. The social-fictive dimension of money is real to people who obey its calculations, imperatives and dictates. It is operationally real at the formal level and socially real at the ideational and behavioral levels. The formal numbers are used to control possibilities and behaviors in a social world where people are educated and/or forced by various power realities to obey the dictates of the money-power system of our society.

    We are stuck with this system for the foreseeable future because most people believe in money and believe in the overall system and it does work practically in a certain way, to a certain extent and it suits a certain percentage of the population, for the time being at least. This is just as the medieval population (across all classes) believed in, or acquiesced under pain of excommunication or death, to faith in God, the Divine Right of Kings and the general right of the people with the gold to make the rules. Now, matters are simplified. We believe in Money, the invisible hand of commerce and the general right of the people with the most money and property to make the rules. This is despite our self-deluding pretensions to democracy.

    What is needed eventually is for faith in money, commerce, capitalism and wealth to be destroyed by real events. And this faith will be destroyed by real events, real soon. The biosphere will degrade, the climate run haywire and money will be exposed as incapable of measuring and managing the real no matter how its financial operations are finagled. In the meantime, we are tied to the faith system of capitalism. The reins of capitalism are still the only reins that work even if the horses now follow a fictitious rather than a real road. Thus, those that know money is ultimately tending to complete fictitiousness, also know that the money reins are still the only ones available to pull. With an eye to the actually real (real systems), they must pull these fictitious reins which are paradoxically given purchase by the mass-delusion faith in capitalism, and pull those reins to guide the deluded believers to a potentially more realistic road. This is what a few of our best influential and less orthodox economists are trying to do, I think. At least, that is the best spin I can put on it to maintain some shred of hope that we are not already totally lost.

    Please note, my views above are very derivative of the Capital as Power project and its main theorists (that I know of) namely Bichler, Nitzan, Fix and Martin. However, I do put my own ontological and complex systems spin on their theories and empirical investigations. Whether this illuminates and extends their work or obfuscates it, I leave to others to judge.

  3. Edward Ross
    April 4, 2021 at 1:34 am

    In reply to Peter Radford and his Title “The Crooked timber of history”
    Firstly some would describe me as a timber freak. I would prefer to describe my self as someone who enjoys salvaging rare timbers even if it has defects in it and making something beautiful and useful out of it For example when in PNG one of the missions in the bush needed a new house badly and asked could I do something for them. I new that down on the coast at Wewak some kiwis were building a large teachers training college for the PNG

  4. Edward Ross
    April 4, 2021 at 1:45 am

    somehow the computer seemed to post before i had finished.
    I had become aware that they were rejecting any timber that was bent. But i also new that it was very good hardwood timber. So as was able to buy it for a vary reasonable price by putting all the bows to the outside wall, i made a very good house

  5. Edward Ross
    April 4, 2021 at 1:49 am

    before i destroy this computer
    The point here is the alternative to the bent timber was to use some easily accessible timber that would not last.

  6. Edward Ross
    April 4, 2021 at 1:55 am

    APPLYING this to ditching capitalism i see it as far better to restore democracy that should enable us to reform democracy. As in the building story us building materials of unknowns quality can not give us the desired result. TED

  7. Ken Zimmerman
    April 4, 2021 at 3:24 am

    The participants on this blog are probably already aware that John Locke produced the philosophical synthesis that served to bring urban commerce from the margins of a society dominated by landowners to the very center of ‘civil society’. In his Two Treatises of Government (1690), Locke outlined three stages of human history, all of them based on a labor theory of value. The first was a state of nature in which humans worked on the landed resources available to them in common and made them their own. Private property was thus conceived of as the result of labor performed without the benefit of a complex political order. (not unlike human hunter-gatherer groups) Money was the catalyst of the transition to the next stage, one of unequal property in land and the accumulation of wealth by means of coercion (e.g., war, theft, piracy). Whereas before there was no point in producing more than you could use yourself (food rots), now surpluses could be stored durably in the form of money (including money-like objects such as stocks, bonds, futures, etc. today). This led eventually to the acquisition of large, landed estates. This meant that producers of commodities could be expropriated by armed ‘thugs’ protected by the king. (thus, a continuing fear of government to our current time). Locke envisaged a third stage of civil government, after the revolutionary overthrow of the second, when the political principle contained in the labor theory of value would be established: people could keep what they had made themselves. He glossed over the difference between owners of firms and their workers (‘servants’) on the grounds that all stood to benefit from escaping the predations of the old aristocracy.

    After Locke established the direction, other actors took over to move Europe toward the world envisioned by Locke. Though the economy may have originally been identified with agriculture, even when large landlords ruled, markets remained a principle focus of theoretical attention. With the consolidation of the European empires to form the first ‘world system’ (Wallerstein 1974), economy came to be increasingly identified with markets. These are networks constituted by acts of buying and selling, usually through the form of money. Historically kept marginal to the other mainstream institutions on which societies were built, from the 18th century markets came to be accepted as central to society. In some theories, ‘the’ institution central to society. The political and academic debate about the appropriate relationship of economy to the other societal institutions has been vigorous ever since.

    All European and world societies before the 18th century tried to keep economic transactions and especially markets in check. Such transactions were viewed as threats to existing social arrangements. Particularly, political control but also religious activities, local governments, and local communities. They were right to do so. As Adam Smith noted, commerce knows no bounds – all markets are in a sense world markets – and this threatens local systems of control. They offer a potential means of escape to the dominated: serfs and slaves, ethnic minorities, young people, women. The power of long-distance merchants often modified the autonomy of local rulers. So, Adam Smith knew what he was talking about when he proposed that society had nothing to fear from markets and indeed much to gain. He argued further that the prime motivation for market exchange was selfish: ‘It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest’.

    As a moral philosopher, Smith was not prone to celebrating the narrow pursuit of self-interest in market transactions; but he found it preferable to indulge this trait en masse than to concentrate economic power in the hands of the elite, however high-minded. He stood conventional wisdom on its head by asserting that a ‘propensity to truck and barter’ was part of human nature and that markets were a better vehicle than any other to increase ‘the wealth of nations’. He clearly stopped short, however of claiming that society’s interests as a whole were best served by markets left to their own devices, without regard for what he called ‘sympathy’ or ‘fellow-feeling.’ But these reservations have largely been forgotten. And in today’s markets are not just ignored but actively rejected: ‘business is business.’ Modern economists glibly quote his invocation of the ‘invisible hand’ without noticing or even caring it seems that Smith was referring to the providential design of social norms and values, not to the impersonal mechanism of the market.

    This is the history that led the world to the ‘precarious’ situation it faces today in balancing technology, its ownership, profit, and the seizure of political and economic power from citizens. Neither property nor the markets that control who ‘owns’ that property must be allowed to undercut society at large or dominate the institutions of democracy, morality, and human community in the working of any society. Even those, like ours that have turned over nearly every aspect of the lives of its citizens to ‘free markets.’ Thus far since the neoliberals in economics and politics have dominated our lives for the last 50 years, they have impoverished millions in the Americas, Europe, Asia, etc., pushed democracy to the edge of extinction, and now are helping to incite a Fascist revolution that threatens just about every world citizen.

  8. Edward Ross
    April 4, 2021 at 4:32 am

    in my last piece it should have red restoring democracy should enable us to restore capitalism for the benefit for all . In reply to Ken Zimmerman i certainly like your critism of neoliberalism as some of friends now i have been arguing against when it was not fashionable Ted

  9. Ikonoclast
    April 5, 2021 at 11:23 pm

    The labor theory of value fails to explain value.

    Firstly, the term “value” is vague in any case. Do we mean “value” axiologically (classifying what things are good, and how good they are) or do we mean “value” economically? The two often do not meet and the prescriptive attempt to make them meet creates many of our problems. Free oxygen in the air is a good to me. It allows me to live and I pay nothing for it except the effort of breathing to acquire it. I pay nothing because it is freely available and not enclosed. Only by enclosure do free goods gain an economic valuation. Side thought – How much longer will it it take the capitalists to enclose the atmosphere, not by physical partition of the atmosphere itslelf but by laws of surface property or even by ubiquitous pollution requiring tanks of retailed air to breath safely? It sort of happens now. The poor breath in the most polluted districts. Gated communities and country mansions are built where the air is cleaner. Retailed cans of oxygen are already available and one touted use is “When Spending Time in a Highly-Polluted Area”.

    What is the value of free atmospheric oxygen to me? The value is infinite, one could argue. With it, I have 1 life. Without it, I have 0 life. One is infinitely greater than zero.

    But sometimes, oxygen is a “bad”. If I cut an apple and take too long to eat it, its slices go brown by oxidizing and become unsightly and mushy. Now oxygen is a “bad”. So goods and bads are complexly relative and inter-relational. Then along comes the economist and wants to measure everything in money (a social-fictive dimension, not a real dimension in scientific terms). The conventional economist wants to make the incommensurable commensurable via a social-fictive dimension unrelated to the dimensions of the real. (See Blair Fix – The Aggregation Problem:Implications for Ecological and Biophysical Economics.) No wonder money-valuing the world makes such a mess of it.

    The labor theory of value fails to explain value because there are many sources of value, not just labor. The earth provides free goods and we mix some of them with social labor and some with personal labor. My breathing effort simpliciter is not social labor. It is personal labor. If I gather berries free from nature and consume them on the spot, then this again is a personal labor, not a labor with any social aspect (if the land is free, natural commons). In any case, different kinds of labor cannot be made truly commensurable by the fiction of socially necessary abstract labor time (SNALT). (See Fix as above.)

    It is not Marx, but Marxists, who use SNALTs while failing to understand them as fictive. Remember, Marx himself wrote, “I am not a Marxist”. Marx’s argument essentially attributes the SNALT’s creation to capitalism, not to true socialism (if such can exist at some future time). It is the set of prescriptive legal laws, property laws, regulations and operations of business and finance which instantiate the SNALT and make SNALTs equatable. Marx, properly understood, was analyzing capitalism. It is capitalism which imputes money value to labor and values it in money units per hour. Since capitalism will not openly acknowledge the reality of free gifts from nature (which Marx and Engels do acknowledge) then by capitalist calculations (which Marx almost exclusively analyzed) all value must come from labor. Thus, Marx was refuting capitalism in its own ostensible terms. If capitalist you say all value comes from labor, then capitalists who are not laboring but still taking some value must be taking it from the labor of others. This is the natural conclusion from capitalist ontology.

    Capitalist apologists could riposte by referencing the free goods of nature to debunk the Marxist (not Marx) form of the labor theory of value. However, in doing so they must admit that they have enclosed and taken as exclusive property the free goods of nature. Thus, they perforce must use Locke’s primitive “mixed with labor to create property” argument, so they too are wedded to the labor theory of (property) value. However, the “mixed with labor to create property” argument is prescriptive not descriptive. Animals, including humans, demonstrate territoriality. Territoriality is the origin of property and possession as it relates to land and its resources (this is distinct from an article made by man). Man does make the land, its resources, or its fundamental natural laws. Man can only enclose these, not make them. Enclosure is a territorial act and as such enclosure can only be enforced by warnings and violence.

    Man is a social animal and as such encloses by pack, tribe, group or nation. The imperfect enclosure (man can never completely enclose) of the free gifts of nature is a biological and social act. The distribution of the free gifts of nature enhanced by labor is also a social act. Economics (say as orthodox economics) is a social decision as to method. It is open to us to change method provided we are prepared to meet, in some manner, the inevitable reactionary violence of the elites.

    (I’ve skipped some argumentation steps to fit this into a blog comment.)

    • Ikonoclast
      April 5, 2021 at 11:29 pm

      Correction: Man does NOT make the land, its resources, or its fundamental natural laws.

      • Meta Capitalism
        April 6, 2021 at 12:09 pm

        Man does NOT make the land ~ Ikon

        .
        Have you ever been to Netherlands? We lived there and they are most certainly reclaiming land from the sea. That may not fit exactly what you mean but land can indeed be reclaimed from the sea. The Dutch are masters at it ;-)

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