Capital as power
FROM THE BACK COVER: Conventional theories of capitalism are mired in a deep crisis: after centuries of debate, they are still unable to tell us what capital is. Liberals and Marxists both think of capital as an 'economic' entity that they count in universal units of ‘utils’ or 'abstract labour', respectively. But these units are totally fictitious. Nobody has ever been able to observe or measure them, and for a good reason: they don’t exist. Since liberalism and Marxism depend on these non-existing units, their theories hang in suspension. They cannot explain the process that matters most – the accumulation of capital. This book offers a radical alternative. According to the authors, capital is not a narrow economic entity, but a symbolic quantification of power. It has little to do with utility or abstract labour, and it extends far beyond machines and production lines. Capital, the authors claim, represents the organized power of dominant capital groups to reshape – or creorder – their society. Written in simple language, accessible to lay readers and experts alike, the book develops a novel political economy. It takes the reader through the history, assumptions and limitations of mainstream economics and its associated theories of politics. It examines the evolution of Marxist thinking on accumulation and the state. And it articulates an innovative theory of 'capital as power' and a new history of the 'capitalist mode of power'.
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3mentions
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2012–2019years
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What Hacker News says
- I guess some simple (probably too-simple) possibilities are:
1. They aren't just trying to beat inflation. *
2. Viable ways to make money change depending on the scale of the money you're trying to tie up. A lot of things don't scale (or, maybe better said, scaling them requires additional competencies and may ruin the margins that made it worth doing).
3. You aren't the only one out there competing for opportunities. There's a lot of money out there seeking return.
* I'm shooting from the hip, based on my (potentially flawed) understanding of some reading I've done over the past few years on the body of Capital as Power (CasP) theory being built out by Jonathan Nitzan and Shimshon Bichler among others.
When they frame Capital as Power, one of the important implications is that it isn't an absolute quanta--it's a relative measure (i.e., power describes a relationship--one can have power in some relations, and not in others).
By framing it as a relative measure, they also suggest that attempts to increase one's capital are less about trying to beat inflation than they are about trying to gain power relative to others. I'm not sure I can unpack this in a very concrete way, but some implications are like:
- You could just beat inflation in a high-growth sector for a decade or two and still lose large amounts of power relative to the big players in the sector, and effectively end up transitioning from having enough power to check the other participants to having too little to keep them from pushing you around.
- You could lose money (absolutely) in a crisis, but still significantly increase your power relative to others.
- My point isn't that Marx was correct (I really haven't studied him more than topically).
It's that a lot of what's passed off as free-market capitalism is anything but.
In biot's case, arguing that the value generated by an individual should serve as the basis for that person's pay. It isn't, but is only one input (essentially defining the demand curve, and setting a possible upper limit), but the true market pay scale being one that would also have to take into consideration supply. As I noted (somewhat snarkily), market conditions for establishing executive pay fall somewhat short of the free market definition. For a more popular treatment, Eddie Murphey and Dan Akroyd's "Trading Places" explores a similar idea. Mark Lewis's writings on the stock market provide some insight on trader qualifications and pay.
A friend some years ago provided an intriguing argument for why financial traders' pay was as high as it was. It was less a conventional market pricing argument than one of creating incentives to minimize incentives for fraud. Essentially: we're going to pay you so goddamned much money that you'd be completely mental to try to cheat on us and lose out.
I really cannot speak to the merits of this.
What that, and numerous other arguments for the rich getting ever richer do suggest is that there is a class of people who are very well versed at rationalizing their income and remuneration rates.
There's also a great deal of very, very, very sloppy thinking, rationalization, reportage, etc., in economic matters.
I'm also coming to feel that much of economics as it's been taught for the past 150 years or so simply isn't so. That the conditions described by free markets are far less common and far more fragile than commonly believed. That much of macroeconomics is bunkum used, again, to rationalize why them that has gets more (though, oddly, I'm also coming to understand money, fiscal policy, and Keynesian theory better than ever before), and that much of the economic gain is really a power game played for leverage and advantage, rather than for strict financial gain. A lens which makes the MPAA/RIAA, copyright, patent, trade and immigration law, etc., far more understandable.
Jonathen Nitzan's Capital as Power seems to have stumbled on this same insight: http://www.amazon.com/Capital-Power-Creorder-Political-Econo...
- I share some of your sentiments for the softer social sciences. I've also grown increasingly skeptical of significant portions of economics as well. Another author I've recently learned of, still need to start chewing into his work, is Jonathan Nitzan, whose Capital as Power is predicated on the notion that splitting Economics and Political Science apart was a mistake. I'd been leaning that way myself.
Lawrence Lessig's Free Culture notes that much recent copyright wrangling is really a return to feudalism. I've been suspecting that it's rather more than just copyright.
