David Graeber has an interesting essay basically getting after Thomas Piketty from the left, saying that the now famous economist’s essential acceptance of capitalism is a problem because it ignores what actually tamed the income inequality that he bemoans: fear of revolution:
Back in the 90s, I used to get into arguments with Russian friends about capitalism. This was a time when most young eastern European intellectuals were avidly embracing everything associated with that particular economic system, even as the proletarian masses of their countries remained deeply suspicious. Whenever I’d remark on some criminal excess of the oligarchs and crooked politicians who were privatising their countries into their own pockets, they would simply shrug.
“If you look at America, there were all sorts of scams like that back in the 19th century with railroads and the like,” I remember one cheerful, bespectacled Russian twentysomething explaining to me. “We are still in the savage stage. It always takes a generation or two for capitalism to civilise itself.”
“And you actually think capitalism will do that all by itself?”
“Look at history! In America you had your robber barons, then – 50 years later – the New Deal. In Europe, you had the social welfare state … ”
“But, Sergei,” I protested (I forget his actual name), “that didn’t happen because capitalists just decided to be nice. That happened because they were all afraid of you.”
He seemed touched by my naivety.
At that time, there was a series of assumptions everybody had to accept in order even to be allowed to enter serious public debate. They were presented like a series of self-evident equations. “The market” was equivalent to capitalism. Capitalism meant exorbitant wealth at the top, but it also meant rapid technological progress and economic growth. Growth meant increased prosperity and the rise of a middle class. The rise of a prosperous middle class, in turn, would always ultimately equal stable democratic governance. A generation later, we have learned that not one of these assumptions can any longer be assumed to be correct.
Couple of thoughts here. First, Graeber is certainly right about the rhetorical and theoretical bankruptcy of the 90s, where if you didn’t accept the neoliberal agenda, you were effectively an overweight Ohioan factory worker with an out-of-fashion mustache who just couldn’t be one of the cool kids. Of course, all the promises capitalists told us about the future were complete lies as they sought to create a New Gilded Age without challenge from any kind of leftist movement. We are just awakening to this reality today. I increasingly see Occupy as a sort of unfocused wake up call where no one is quite sure what has gone wrong, but people realize, wait something is wrong! It reminds me of the 1870s and 1880, where you had a generation of workers who had believed the economic promises of business leaders and were shocked to find out that what had really happened was class warfare enacted from above upon the poor. It took 20 years and the importation of radical ideas with immigrants to bring a more focused challenge to the unrestrained capitalism of the Gilded Age to the U.S.
I will say that I’m not totally comfortable with Graeber’s construction of a kinder, gentler capitalism. There was fear of a leftist uprising, but it wasn’t from the corporations, who were happy to just murder organizers. It was from politicians and the middle class, who voted in the changes. And that happened not because of any real possibility of leftist revolt in the U.S., because that never really existed in a legitimate way like in Europe. It happened because workers organized to demand changes in the system that reduced income inequality. In some ways, they wanted the same things as Thomas Piketty–a fairer system rather than revolution.