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Mythbusting Capitalism: The Free Market Spreads Boredom, Not Innovation

June 12, 2011

A frequent myth about free markets and market economies is that competition between firms spurs innovation.  The idea here is that individuals motivated by profit will invent new products or innovate old ones to get the edge on their competitors and gain a greater share of the market. There are numerous examples cited: Ford and the automobile, Mark Zuckerberg and Facebook, Daniel Plainview and oil (or milkshakes) or whatever.  And while all this might sound reasonable in theory, it just doesn’t work out that way in real life.  While the profit motive and markets may create this one incentive for innovation, all the other ways that markets prevent or actually crush innovation and creativity are left out of the equation.

The Political Economy of Boredom

High unemployment, widespread poverty, the homogenization of thought and culture, and the general misdirection of resources away from institutions that genuinely spur innovation (like education and the arts) are all products of a system which requires firms in an economy to streamline production, keep the costs to investors low and maximize profit.  A society that keeps millions in poverty or burdens them with monotonous toil and conformity is not a society that encourages creativity and innovation, but crushes it.

For instance, if markets are adept at innovating anything it’s methods of production, like the development of the assembly line, robotics, or high-speed communication, for example.  However, as political economists have pointed out for centuries, with each step taken in streamlining production–making it faster, simpler and more “efficient”–so too is the boredom, tediousness and monotony of work advanced as well.  The German philosopher and political economist Karl Marx colorfully illustrated this in Capital in 1867,

[W]ithin the capitalist system all methods for raising the social productiveness of labour are brought about at the cost of the individual labourer; all means for the development of production transform themselves into means of domination over, and exploitation of, the producers; they mutilate the labourer into a fragment of a man, degrade him to the level of an appendage of a machine, destroy every remnant of charm in his work and turn it into a hated toil; they estrange from him the intellectual potentialities of the labour process in the same proportion as science is incorporated in it as an independent power; they distort the conditions under which he works, subject him during the labour process to a despotism the more hateful for its meanness; they transform his life-time into working-time, and drag his wife and child beneath the wheels of the Juggernaut of capital.

In other words, in order to maximize profit and expand production, work has to be streamlined and thus the boredom, repetition and monotony of work is increased (degrading the worker “an appendage of a machine”).  In a market economy it’s not an option for a firm to not innovate production and find cheaper, simpler ways of producing goods and services.  Maximizing profit is the only way to ensure that businesses keep their doors open or prevent themselves from being taken over by a larger firm (no matter how “socially conscious” a business or owner may be).  And so long as the overwhelming majority of the population is doomed to spend a chunk of their days slaving away doing monotonous, mind numbing labor, that society will be stifling to creative thought and innovation, not advancing it.

Mainstream education almost invariably and necessarily mimics the monotony of labor.  This is not only necessitated by the misdirection of resources away from education to give tax breaks to corporations and fund warfare, but also because education needs working-class children to conform to the obedience and boredom of their life as a worker.  The typical school day of most schools is a mirror image of life at the workplace: sit down, perform boring repetitive tasks for about eight hours under the supervision of some authority figure and do what you’re told, or else.

The purpose of mainstream schooling is not to teach people to think creatively or critically, but to anesthetize young people into conforming to the obedience of capitalism.  Political leaders are quite clear about this, in fact, as they frequently justify increasing standardization and regulation of education by citing the need to “reform” education to prepare children for the labor force and competition in the “global marketplace.”  The New Left inspired educator Jerry Farber aptly described the creativity crushing nature of mainstream education when he wrote in “A Young Person’s Guide to the Grading System” in 1969,

History is so engrossing. Literature is so beautiful. And school is likely to make them dull or even ugly.  Can you imagine what would happen if they graded you on sex? The human race would die out.

The abandoned St. Christopher House, former public library in Detroit.

While innovations such as robotic production could be used to give workers more leisure time–perhaps for going to school, creating art and culture, reading or writing, or just hanging out and having fun–they’re used instead to lay workers off, placing the excess labor on the remaining workers, almost without exception.  This phenomenon is just one of the causes of the urban crisis beginning in the 1960s which led to massive poverty density in urban centers like Detroit, Oakland, the Bronx, South Chicago and so on.  As technological developments in manufacturing allowed for faster and more automated assembly, workers, especially black workers, were laid off in droves, dooming millions to poverty in the name of profit.  This leaves us today with all the problems characteristic of inner city poverty such as high levels of violent crime, failing schools, high drop out rates and worse.  Tell me again how widespread poverty is supposed to encourage creative thinking and innovation?

The evolutionary biologist Stephen Jay Gould sums all of this up quite well, saying that he was “somehow less interested in the weight and convolutions of Einstein’s brain than in the near certainty that people of equal talent have lived and died in cotton fields and sweatshops.”  Millions of people who have had all the talent and brilliance necessary to be great musicians, writers, inventors, scientists, painters, doctors or whatever they liked, have instead been doomed to lives of poverty, monotonous toil, lonesome domestic labor, prison (since poverty necessitates finding illicit work in the underground economy) and so forth.

Locking up Innovations and Throwing Away the Keys

But what happens when when innovative ideas actually manage to break through? Then they must tackle the veritable fortress of copyright, patenting and regulatory laws that are used by corporate regimes to crush ideas that challenge their hold on power. So, when a new medicine or energy source is created or discovered, big pharmaceutical and energy companies will use these laws to crush or prevent further research and development in order to prevent a new competitor in the market.  When new innovations still manage to jump over these hurdles, they are typically bought out by the business dynasties, patented and then locked in a vault somewhere on Wall Street.  Want a cure to cancer? Look in the basement of Pfizer’s headquarters, you’ll probably find one or two. There’s so much more money to be made in treating the symptoms! Who would want to cure it?

For one more elaborate example:  Consider male birth control.  A new method of non-hormonal male contraception called RISUG (“Reversible Inhibition of Sperm Under Guidance”) has been developed by Indian researchers. RISUG is an injection based contraceptive treatment that has been proven in study after study to be 100% effective for up to ten years and completely reversible, with absolutely no side effects at all.  It’s simple (one painless 15 minute operation, and it’s just as simple to reverse the procedure) and extremely low cost.  Female hormone based contraception is so expensive and so loaded with disastrous side effects that, were this procedure to be available to the public, there would be an absolute rush at the clinics for it.  But it’s not available to the public, and won’t be for a very long time.  Wired Magazine explains,

[Researchers] looked around for a corporate partner but found no takers. Unlike birth control pills, which must be used daily, sometimes for years, RISUG is a long-lasting, low-cost treatment (the syringe could end up costing more than the material it injects).

“Pharmaceutical companies are not interested in one-offs,” [researchers said]. “They’re interested in things they can sell repeatedly, like the birth control pill or Viagra.” Reluctantly, [researchers] gave up on plans to commercialize the procedure in North America.

A useful, inexpensive form of male contraception is not available to Americans because corporations are blocking it from being made available precisely because it’s so inexpensive that it would put them out of business. Go figure. Unfortunately this sort of thing happens all the time under capitalism, from food, to fuel, to pharmaceuticals and beyond.

A Proposal for the Future: The Economics of Equitable Cooperation

Far from spreading creativity, the competition and greed necessitated by market economies directly stifles and inhibits it.  Imagine the potential if all the trillions of dollars of resources hoarded by corporations were used cooperatively for research, discovery and innovation, instead of being used competitively in the hopes of putting one another out of business. Luckily for us this potential for an equitable and cooperative future does exist.

The alternative can only be realized with the replacement of private ownership of production with social ownership, and replacing free-market competition with a system based on decentralized, democratic planning, where production is no longer out of self-interest and private gain, but for the benefit of society (and the environment).  In this system of economic planning, all production, distribution and consumption would be planned democratically by workers and community members.  Workers and community members would decide in small councils what should be produced, and estimate how much of each good and service is needed for a certain period of time (based on previous consumption patterns).  This wouldn’t actually have to be any more complicated than filing taxes.  The prices and costs of goods and services could then be either raised or lowered to reflect real social and ecological benefits or costs (e.g., today it’s much more expensive to drive low-pollution hybrid vehicles than gas guzzlers even though low emission vehicles are obviously better for society and the planet, and should therefore be less expensive to own and drive).

Since, in this arrangement, economic firms would necessarily act out of the interest of social and ecological benefit, massive levels of economic resources would no longer have to be misdirected to the conquest of foreign resources (like oil, for example) or to the interests of maximizing private profit, but could instead be directed toward education, arts and other things that genuinely spur innovative and creative thinking.  Furthermore, time- and labor-saving innovations in production (like robotics and high-speed communication) could be applied to shortening the working day for each employee, instead of shoving off thousands to collect unemployment. Since productivity always increases with each new innovation, there is more than enough for everybody to enjoy and still work.  Finally, even the structure of the workplace could be rearranged so that employees could split their working day evenly between (the necessary) boring labor, and creative and empowering labor, so that our jobs no longer have to be boring but could actually be fun and thoughtful.

This may sound like a pipedream to the cynics but there’s no reason this isn’t a possibility for humanity’s future.  These sorts of cooperative and democratic economic, political and social arrangements have been tried and have even worked in the past (or are even succeeding in some form or fashion today).  In the immediate future we should fight to win shorter working days, higher wages and benefits and more resources for education and public endowments for art, science and creative work.  But in the long term we need to solve the whole problem.  What we need in order to seize this future is a powerful, militant movement of people who are willing struggle for their own liberation.  Join us!

  • http://twitter.com/Toka248 Craig Hennigan- Toka

    Two needle shots in the scrotum is painless? Other than that this is a fun read..lol

    • http://shegetzguevara.wordpress.com Aaron Ptkf

      Haha, I figure unwanted pregnancy and expensive hormone contraception is probably more painful. I’m glad you enjoyed it!

  • http://freeman23.tumblr.com/ j.f. smith

    What Craig said. My scrotum aches just thinking about it. Otherwise, this is a generally accurate look at capitalist markets, as I see it. I have two thoughts to share, though:
    1. Free markets don’t exist. Actually existing markets have emerged within social and political contexts that have anything but free, to the benefit of capitalists looking to reduce worker autonomy and generate steady streams of profit without having to truly innovate or compete. Your section on “intellectual property” illustrates that quite well, showing some of the many ways life has been enclosed on behalf of those seeking to thwart competition and innovation while pretending to exemplify them. Former Archer Daniels Midland CEO Dwayne Andreas once candidly remarked in some sort of industry-based publication that “There isn’t a free market in anything, anywhere in the world.” He also admitted in the same interview that “The competitor is our friend. The customer is our enemy.”
    2. While appeals to economic planning generally make me cringe, I admit that some sort of decentralized, truly democratic form of planning arising organically from the bottom up could indeed be plausible and constitute part of a free and democratic economic whole, along with organic, bottom up markets freed from capitalist and statist shackles, gift economies and other voluntary alternatives.

    • http://shegetzguevara.wordpress.com Aaron Ptkf

      Hey, thanks for sharing your thoughts!

      I figured sooner or later somebody was going to bring up this argument that markets typically aren’t “free.” My first point would be that I believe it’s in the nature of markets not to be “free” in the since of a laissez faire market. Markets have a natural tendency to, 1) develop large monopolies that have correspondingly large amounts of political capital that is then, 2) used to generate legal regimes that favor monopoly interests (corporate welfare, copyright and patent laws, etc). Even if it were possible to “break down” or “roll back” markets, in a sense, to more a “localized” or “small business”-type of capitalism, the most successful firms would still find ways to spread markets geographically even within the legal limitations, or by breaking down the legal strictures.

      Secondly, my previous point aside, I think markets are free in the sense that firms are almost at complete liberty to generate as much profit as possible little restriction by the public or stake holders. Capital can freely cross borders, exploit labor in other countries, abuse human rights, and contaminate air, land and water, without apology. Where restrictions do exist, they are the result or legacy of working class struggle and, of course, are under constant threat by the interests of capital.

      Certainly planned economies have a justifiably bad rap, having been vulgarized in the past by bureaucratic, central planning in the Soviet Union, China and others, however, there’s no other real desirable alternative that I’ve heard of. Unfortunately, however, I don’t see it being possible to sustain a “mix” of different types of economies, i.e. it wouldn’t be possible to have some industries under social ownership and planned, and others remain in a market, partly because of my earlier point about “local” economies and markets needing to expand (i.e., the pressure would exist to bring planned industries into the market). Furthermore, planned industries would naturally have to adjust their plans to meet the fluctuations and trends of local markets (costs, prices, etc.) and thus, become penetrated by market forces, thus breaking down the gains made by planning.

      I can’t really see a reason to want markets at all, on any level, when a decentralized, democratically planned option is available.

      Thanks for sharing your thoughts! I’m glad more people are providing feedback and discussion here.

      • http://freeman23.tumblr.com/ j.f. smith

        Thanks for replying, Aaron.
        Regarding your first point, I would agree with all that, but only in relation to capitalist markets. It doesn’t seem wise to me to address something like markets, qua markets, by falsely conflating it with markets within a particular context. It’s certainly not in the nature of capitalist markets to be free, and capitalist markets have historically resulted in all the things you mention, but none of those things necessarily follow from markets themselves. Large monopolies would never have emerged were it not for primitive accumulation, favorable legal arrangements, “intellectual property” and other forms of state-backed privilege that have nothing to do with, and indeed profoundly pervert, market activity in ways benefiting capitalists at everyone else’s (not to mention Earth’s) expense. Existing capitalist markets were created by and are maintained by massive levels of violence, and no honest defender of markets (very very few in number, unfortunately) would excuse or otherwise defend any of that. I recommend checking out a couple of essays by mutualist Kevin Carson on the subject – The Iron Fist Behind the Invisible Hand and Austrian and Marxist Theories of Monopoly Capital – A Mutualist Synthesis.

        I agree with your second point entirely – firms indeed enjoy almost complete liberty to run roughshod over people and the planet. That’s what happens when hierarchical, profit-oriented firms inherently at odds with market logic enjoy privileged protection from market and democratically oriented regulatory checks, not to mention a captive pool of labor lacking autonomy, individually and collectively. The private tyrannies known as corporations have an inherently cancerous logic that ultimately render markets increasingly counterproductive in terms of efficiently and humanely organizing economic affairs, in large part because they engage in the same types of centralized planning found in Soviet bureaucracies.

        All of this leads to a parallel of sorts between market economies and planned economies – the fact that both have justifiably bad raps, having been vulgarized in the past by those seeking to bureaucratize and centralize relations generally, in order to render things more legible and more conducive to social control and exploitation. It doesn’t make sense to condemn markets and planning in and of themselves due to the awful results generated by their vulgarization.

        Daniel Quinn coined one of my favorite mottos – “There is no one right way to live.” I’ve increasingly realized that all ideologies, all one-size-fits-all “solutions”, etc. inherently suffer from knowledge-based problems resulting from their ultimately fragmented and limited natures. In other words, they represent the “blind men and an elephant” story. Returning to economies, it doesn’t seem wise to me to ignore nature’s contempt toward monocultures by placing all of our eggs in one organizational basket, whether that basket represents market exchange, democratic planning, or any other alternative. I’d rather have as many potentially useful tools in my toolbox as possible, and not succumb to limiting myself by removing certain tools just because they may have been used in destructive manners. I find it unfortunate that market libertarians falsely conflate democracy with statist representative democracy and planning with centralized bureaucracy, on the one hand, while libertarian socialists falsely conflate markets with capitalist markets. While I’d agree that capitalist markets would certainly threaten attempts to create more democratic alternatives, I think that fear becomes unwarranted if the markets in question are freed from artificial scarcities and barriers to entry, state privileged forms of organization (corporations), and what Benjamin Tucker generally referred to as “the four monopolies”. Would markets really be worrisome if the means of production were owned and controlled by the workers themselves, rather than politically privileged absentee owners who place profit above all other concerns? All one can do is speculate, and that’s no different if the focus is shifted to planning rather than markets.