Envisioning Capital

Summary & notes for the article Envisioning Capital: Political Economy on Display by Susan Buck Morss. Published in: Critical Inquiry, Vol. 21, No. 2 (Winter, 1995), pp. 434-467

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"This was the cold war era, when life on the planet literally hung in the balance over the issue of how government and economy were related." (p. 437)

Buck-Morss starts with two familiar diagrams: one, a contemporary (1985) sociogram of relationships at a university industrial research centre; the other (1977), a 'basic hierarchical structure of modern business enterprise'. Their characteristics are, in turn, as follows:

1. The former is representative of a 'second industrial divide' showing a "restructuring of capitalism characterized by decentralized production and changed technologies of flexible specialization, technologies that impose a competitive strategy of permanent innovation..." involving (via Robert Reich) "one-fifth of the U.S. population..."

2. The latter, the 'first industrial divide' depicts the standard organisation of 'operating units' which are managed by a hierarchy of executives who surveil and coordinate a continuous process of mass production. The transition from this mode of organisation to the more 'flexible' former version is prompted, in part, by the automation (computerization) of managerial roles and functions.

The shift from the 'first' to the 'second' industrial divide is a radical one, and involves not only the restructuring of the firm, but also the wider political-economic landscape. "When giant corporations reigned supreme, their top executives, 'corporate statesmen,' were close to political power." (p. 436) In the context of the cold war, this is as true for the West as the USSR; however, "...it was not similarity in form but the flow of power—and goods—that counted..."

Because they owned the means of production, capitalists had no need to control the product. whereas in capitalism power was a consequence of the distribution of goods, in Soviet socialism the distribution of goods was a consequence of power. [...] It is the depersonalization of exchange within capitalist society that depoliticizes economic power, no matter how close capitalists and politicans may become. (p. 437)

This differentiation between flows has a large impact outside macroeconomic contexts as well, on processes of subjectivation, individuation and the 'feeling' of freedom for a given 'polity':

Under capitalism, no matter how bureaucratic the organization, such points of market indifference—and therefore of individual freedom—are productive of the very fabric of society. Under Soviet socialism, in contrast, a person's indebtedness was 'infinite,' even for Party members; because symbolic social exchange—social obligation and sacrifice—was conceived to be without limits..." (p. 438)

For Buck-Morss, within this logic, it is clear that 'cold war capitalism' delivered the goods over Soviet socialism: "Given the criterion of consumer plenty, Americans easily believed that the public interest was synonymous with the growth of national firms." (p. 438) A smooth 'vision' of the national-economy was produced which bound together intranational polities without recourse to explicitly political processes.

However, this is wrong (again via Reich): "The American polity [...] has become unstuck from the American economy..." evident primarily through rising wealth inequality and the ability of 'world citizens' to 'slip the bonds of national allegiance.' This is an issue, because: "[w]hen members of the same society become aware that they 'no longer inhabit the same economy', they are tempted to reconsider what they owe each other." (p. 439)

This is problematic not only as a 'legitimation crisis' for the welfare state, but also for the social polity more generally, as it "challenges the very definition of the collective [...] itself." (p. 439)

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How does the (Western liberal-democratic) nation (developed in C18th Europe) imagine a collective is formed?

"The proposition that the exchange of goods, rather than denoting the edge of community, is capable of functioning as the fundament of collective life necessitated the discovery that within the polity such a thing as an "economy" exists." (p. 439)

This 'discovery' was in-fact an invention (Foucault): "every new science creates its object. [...] The great marvel is that once a scientific object is 'discovered', it takes on agency." (p. 439). This process of invention/discovery is itself predicated on the process of 'representational mapping' — such 'doubling' allows the viewer to see the whole as if from the outside. (p. 440)

"Navigational maps were prototypical; mapping the economy was an outgrowth of this technique." (p. 440)

For Morss, the French 'Physiocrat' François Quesnay provided the first such map in 1758 through the 'discovery' of two schemes: "circulation (circular flow) and production (the fertility schema), folded into each other in the same social body." (p. 443) This scheme cut against mercantilism's 'zero-sum' theory of trade and wealth creation, demonstrating the generation of surplus value within the European economy via the sphere of production (Marx), rather than relying solely on colonial extraction of previous metals.

Quesnay's 'economic picture' — predicated on the productivity of agricultural processes and advances — served as a basis from which one might argue "that the economic system had no need of government control..."; taking on a 'metaphysical' quality, described (by Mirabeau) as a "...great machine" of nature, "animated and directed by its own springs" as in "no need of outside direction" (p. 445).

In his own time, however, Quesnay's political-economy was still dependent on the king as only he was "in a position to see the whole and govern according to the natural laws that guaranteed its rational functioning." (p. 444) There was a moral aspect to this — private, mercantile fortunes were for him a "clandestine form of wealth which knows neither king nor country..." As Schumpeter writes: "here then, was la raison [reason], with all its uncritical belief in progress, but without its irreligious and political fangs. Need I say that this delighted court and society?" (p. 444)

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Two decades later, in The Wealth of Nations (1776), Adam Smith undoes this relation to the 'king and his authory' — the 'whole body of the people' is both the consideration and audience for his work — and "...this social body that sees itself described is a new one." (p. 445)

Against feudal theories of the social body as effectively 'similar to that of a man' (Rousseau) — with a head (sovereign), brain (laws/customs), digestion (industry/agriculture) & circulation (economy), as well as an overall 'general will' — Smith 'secularizes' and 'pragmatizes' the polis: "it must be produced by doing..." Produced, specifically, by the 'laboring masses': "The economy is the place of creative action. And politics recedes from center stage." (p. 446)

This 'machinistic' description of the universe is not a metaphor (as it is for Quesnay and Rousseau): "machines are, literally, the means whereby labor, divided and specialized, becomes productive." (p. 446) Agriculture is supplanted by industry as the arena in which we can 'see' a new schema of economic fertility — hence why Smith chooses the pin factory as his main example: "small enough so we can 'see' the principle of the division of labor that governs the whole." (p. 446) Unlike in Quesnay, however, there is no perspective (neither King, God nor Reason) from which the whole productive social body can be viewed... (perhaps this is a reason for the invisibility of Smith's 'hand'). We can only see the effects of this fertile process, in the commodities which start to pile up.

"Smith's fertility schema is the multiplying effect of a procedure, not something, nor even somebody. [...] This division causes the productivity of labor, machines, capital—not vice versa." (p. 447)

There is, however, a moral issue with this arrangement:

"The same division that causes the social organism to grow in wealth also causes the individual worker to become [spiritually] impoverished. [...] Here is the paradox in Smith's view of homo faber: each real body is stunted in order for the social body to prosper." (p. 448)

The figure of the 'consumer' (who can now have coats, shoes, utensils, bread, beer, windows, etc) is then positioned as an answer to this problem, and "with the wave of a hand, the victim of the division of labor becomes its beneficiary." (p. 449)

However, for Morss, there is an issue with this logic, an issue predicated on the inequality of the new situation (some do very little, and still benefit from the division of labor):

"The division of labor, upon which the wealth of nations depends, creates (against nature) a society of unequals. Class difference is the by-product of national wealth—and it is class difference that determines one's power in the marketplace, including the power to bargain effectively for the price of one's own labor." (p. 449)

This is what defines the 'invisible hand' — that which "opens up a blind spot in the social field, yet holds the whole together." (p. 450) The 'body' of this hand is "composed of things, a web of commodities circulating in an exchange that connects people who do not see or know each other. [...] Commodities are the key to Smith's defense of the new social body; despite distinctions between rich and poor, all members of "civilization" can console themselves, because the quantity of things they possess marks them as superior to much of the world's population..." (p. 450)

The role of desire in theories of the social body then becomes an important point — people have to be made to want things. The 'invisible hand' also serves this purpose 'harmonizing the whole' by 'cunningly' orchestrating each individual persons' desire (against their intentions). However, this can become an unsatiable, runaway process: as the 'face-to-face society' morphs into a 'thing-society', the 'pleasure of mutual sympathy' which constrains self-interested behaviour begins to dissapear. Instead of sympathizing with their 'compatriot' one empathizes with the commodity, mimicing its expansiveness. The 'social nexus of civilization' is then predicated on the insatiable desire for commodities within each individual.

Smith counts on this 'natural' instability for the health of the 'collective level' of the economy (which simultaneously produces a 'schizophrenic' eceonomic subject at its base): "the deceptive promise that happiness will be gained through the possession of objects is the decoy whereby nature ensnares the imagination and transforms it into a collective good." (p. 453)

"Not demand, instrumentally and rationally calculated, but desire, deceived by commodities as decoys, is the motor force of Smith's 'economy.' We are caught in its orbit as self-interested monads who precisely in our unreason bring about reason's goal." (p. 453)

This argument relies upon contemporaneous innovations in the field of visual representation that makes it possible to chart the effects of the 'invisible hand'. During this time William Playfair — who invented the line, bar, area and pie chart — was creating a 'Commercial and Political Atlas' that, "rather than attempting to provide a God's-eye view of the whole", provided a "form of data graphics [that] correlates two measurements [...] over time." (p. 455) Borrowing from Edward Tufte's analysis of Playfair, Morss notes:

"Brand new is the fact that, unlike earlier maps, the graphical design is 'no longer dependent on direct analogy to the physical world. ... This meant, quite simply but quite profoundly, that any variable quantity could be placed in relationship to any other variable quantity, measured for the same units of observation.' 'Relational graphic[s]' link 'at least two variables, encouraging and even imploring the viewer to assess the possible causal relationship between the plotted variables'" (p. 456)

This new 'image' of economic processes allows one to argue causes on the basis of effects (correlation =?= causation); to show "patterns of market behaviour that emerge unintentionally from the aggregate of individual decisions..." (p. 456).

"Playfair's work lays the ground for the method of producing knowledge within the new discipline of political economy-not a picture of the social body as a whole, but statistical correlations that show patterns as a sign of nature's plan." (p. 457)

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This 'discovery' of the 'natural' laws of political economy (along with the newfound role of commodities/money equivalents as a mediator of social relations) caused an 'extraordinary revison of the social body' — one which split the social collective into two visions:

1. The economic, a 'grand philosophy' which sought to place "an anthropology, a political theory, a theory of social practice all within the orbit of economic life, appropriating them from the realm of political power and police control." (p. 456)

2. The political, predicated on traditional notions of civic virtue (described above).

The contradiction in Smith's political philosophy lies in the fact that the "civic society he desires is founded on principles inimicable to the economic society he describes."

For Morss, Hegel is one of the first philosophers to break with both 'traditional ancient' and 'Enlightenment' meanings of civil society, instead identfying it (bürgerliche Gesellschaft) as precisely that society created by what Smith calls political economy.

"...Hegel's original insight [is] that civil society, as "modern society," is produced by a historically specific form of economic interdependence, one that follows all of the principles of logic that Smith described" (p. 457)

Hegel understands and fears, in particular, the new, blind or 'accidental' "infinity of human needs, the limitless growth of both goods and human desires..." which this system of interdependence or 'mutual dependency' produces. (p. 458) The state, through law and the police, as a kind of deus ex machina, then necessarily become an oppositional power to bring order, set boundaries, and operate against the 'wildness of the system'.

However, it goes further than this, as, for Hegel, the qualities of these 'accidental' events within the marketplace can be transcribed (via the battlefield) onto the 'history of progress'. The same way in which, for Smith, 'reasons' cunning (encoded in the 'natural laws' identified in Playfair's charts) operates regardless of the intentions of individuals, for Hegel, it "is through the passions and desires of great men, political actors rather than economic ones, that reason 'cunningly' works its way out into history, achieving, for collective action, a rationality denied to that of individuals." (p. 459) The invisible hand returns!

"Hegel's 'cunning of reason' plays, on the politico-historical level, precisely the role that Smith's "invisible hand" plays on the socioeconomic level, including the ideological role of justifying the harm done to individuals in terms of "progress" for the social collective." (p. 460)

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"Not qualitative judgement, but quantitative measurement [became] the criterion of scientific knowledge." (p. 462)

Importantly, however, both Hegel and Smith "understood political economy as belonging to a more general philosophical discourse, one that entailed critical reflection..." (p. 460) This 'normative dimension' is, it seems lost, in the 'deep epistemological break' between classical (1700's) and neoclassical (1800's) economics; the 'professionalisation' of the discipline which sought to purge the 'science' of economics from such psychological, or value-oriented concerns. Despite 'demand theory' hinging on the 'subjective desires' their origin is intentionally shrouded in mystery.

"Economic theory is now concerned with the far narrower task of describing "laws" that account for regularities of market behavior as a self-interested rationality of means, while it remains totally indifferent to the normative questions about the reasonableness of individual motives or the substantive rationality of social ends" (p. 461)

Neoclassical theories such as 'marginal utility' elide the problems or questions of class polarization, and even growth (the fertility schema), by focusing only "...on individual economic behavior, wherein the same mechanism of scarcity and demand sets the price of labor's wages, interfirm purchases, and consumer buying." (p. 463) The only value economic problem is the pricing and resource allocation of fixed supplies.

The principle characteristic of neoclassical economics is then minimalism in its 'visual display', microeconomics. This is the end of political economy as a philosophy:

"Once this happens, critical reflection on the exogenous conditions of a "given" market situation becomes impossible, and the philosophy of political economy becomes so theoretically impoverished that it can be said to come to an end." (p. 463)

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Many would welcome the dissaparance of philosophy from economics, and the (not uncontested) success of neoclassical theories. Wasn't this the problem of Soviet socialism? Even Keynesianism "never tried to deduce from the economy a vision of society as a whole" (p. 465)

The only view available is that of the individual, "even when economic actors are states or firms, their profit-maximizing reasoning occurs without any vision of the whole." (p. 466) This is problematic in the domain of political action:

"When Foucault praises the invisibility of Smith's hand because it does not allow the sovereign sufficient knowledge to control the social field of individual desire, he forgets the other side, that the desiring individuals also lack this knowledge, and that such knowledge is vital for effective political response" (p. 466)

The rise of reactionary nationalism, for example, is in part due to the condition of 'blindness' to the 'objective deteminates' of social life (Morss gives the Russian 'big bang' as an example).

"A philosophical, critical vision of the social body as it is produced by the global economy provides an alternative to the politics of renewed nationalism. Such an alternative vision has the healthy advantage of corresponding to the facts because economic interdependence, not ethnic purity, is what our world is really all about." (p. 466)

Morss finishes by not only calling for alternate visions of the global economy, but also by calling out the dearth of 'theory' today which can meet this challenge of 'envisioning the social whole.' The problem of representations of the 'global system' will not go away because theorists refust to speak about it.