THE ROLE OF THE STATE IN ECONOMIC THEORY has rarely
been examined owing to the mistaken notion that the State is a political
structure or institution that is wholly “adventitious” or epiphenomenal or
superstructural and so entirely extraneous
to the reproduction of society, albeit not to its “foundation”. This seems
incongruous if not contradictory because, if indeed the State is essential to
the establishment of a society –
indeed, of the “re-public” -, then it seems odd that it should not play also an
essential defining role in the
constitution of the most basic “economic” categories and relations of that
“society” or “republic”. This peculiar
theoretical flaw and lacuna is due in part to the approach of classical
political theory to the State which sees it as simply being the collective noun
for its constituent building blocks such as the individual or the family
household or the tribe or the city and finally “the people”.
Because economic theory is exclusively concerned
with the production and exchange of goods and services between “individuals” or
individual “units” and not with the “reproduction” of society as a whole – that
is, not with the metabolism of a
society with its “environment” which would entail the analysis of “economic”
relations in the broader context of the “choices” selected by a society and its members from virtually limitless
options and possibilities -, for this very reason economic theory has
universally neglected the role of the State in the economy. Yet, whereas economic theory sees Politics as
an intrusion in Economics, in reality it is economic theory that wrongfully
extrudes Politics from what it claims to be its “scientific” ambit. By
contrast, the notion of metabolism serves to restore the ineluctable element of
“choice” and “project”, and therefore of the Political, in the selection of
alternative social relations of production.
Owing to these twin misconceptions, aided and
abetted by the political interests and outright violence of the bourgeoisie,
economic theory has always emarginated the role of the State in “the market
economy” to that of mere “Police” – to that of a purely “administrative” body
that preserves or conserves and regulates the autonomous “natural rights”
obtaining between individuals historically and analytically in a societas naturalis that existed prior to the establishment of the societas civilis and the State, as in the
Lockean jusnaturalist version, - or else, as in the Hobbesian version, to one where
the State is instituted wholly contractually for individuals to exit the anarchy, lawlessness and
civil war of a hypothetical state of
nature. In the former case, the Lockean, the State acts merely as an arbiter – as an independent judge – to
adjudge and enforce the respective natural rights of individuals, which are
thought to be historically prior to and analytically independent of the State.
In the latter, Hobbesian case, the State is the actual founder of human
society; it undertakes a restauratio ab
imis of human society or erects a “total constitutional order” - so much so
that State and civil society are indistinguishable as status civilis as against the lawless state of nature or status naturae that preceded its
contractual foundation (v. Hobbes, De
Cive, X, I; or Rousseau, Le Contrat
Social, or consider Pufendorf’s “extra
rem publicam nulla salus”).
Yet even in the Hobbesian version of jusnaturalism,
where the State is actually the fons et
origo of these “rights” (the status
civilis of legal positivism), it is still not considered to determine the
substantive content, the “essence”, of economic categories. Thus, in both
versions, the State enforces these “rights” without actually determining their content, which supposedly arises from an
autonomous “economic” sphere consisting of the utilitarian needs and wants of
individuals. In both cases therefore - and this is the decisive point –, the
economic sphere exists independently
of the State in a fundamental historical and analytical sense. Indeed, even the
mechanistic Hobbesian state by institution that could never be said to have
existed historically on account of its extreme suppositions threatens to become
a state by acquisition in the Lockean sense because once a civil society
descends into civil war of the kind hypothesised by Hobbes, then it will be
impossible for humanity to escape or exit from that State.
Whereas in classical political theory the State was identical with society itself, either as
the ethical dimension of being human (as with Aristotle’s zoon politikon, for which Politics is the continuation of Ethics)
or as the worldly embodiment of a divine or transcendental Reason (as in Thomas
Aquinas’s notions of animal sociale
or animal rationale), in modern
theory the State is quite distinct from society either historically as
postdating a primordial pre-statal society or analytically by virtue of the
assumption that such a society devoid of all “statality” – either a state of
complete “anarchy” (Hobbes’s bellum
civium) or a societas naturalis (Bodin, Locke, Rousseau) – is indeed possible.
The “science” of economics became imaginable only
once the triumphant capitalist bourgeoisie seriously set up its central
political aim to confine the role of the State precisely to the perpetuation of
this false separation of the Political
from the Economic. This in turn
required the identification and isolation of a sphere of social life that is
not contaminated by “values” other than the Value of economic theory –
“exchange value”. The cardinal point to consider is that this “technical
neutrality” of the State had to proceed hand in hand with the destitution of
“individuals” of all Ethico-Political values and their reduction from
“citizens” to economic atoms whose activities could be calculated and measured
in isolation from one another so as to lend “scientific” economic Value to the
utilisation and production of social resources. But in fact and in reality,
this reification of human living activity – its reduction to “measurable”
labour-power - is a specific form of social violence perpetrated by the
capitalist bourgeoisie.
Even Marx, in his critique of political economy, sought to establish that in the
process of commodity production and therefore of economic value the capitalist
derives a profit by extracting surplus value from the labour-time “socially
necessary” to produce those commodities. But one source of surplus value that
Marx specifies arises from the fact that the capitalist does not pay workers
for the sociality of their
“individual labours” – for the fact that what are supposedly “individual labours” are in reality indivisible
aspects of social labour. Thus, in
his effort to present his theory in a scientific guise, Marx neatly obscures
what he clearly recognizes, that is to say, that it is impossible to specify
and calculate economic Value independently of the “sociality” of human living
activity – which therefore leads us inevitably to ethico-political values as the real matrix of economic value.
Marx’s discovery of the Doppelcharakter of production in capitalism, contrasting the “use
value” of human production with its “exchange value” under capitalism echoes
the ancient Aristotelian distinction between the oikonomia (the laws of the household) and the chrematistike (the speculation of finance). It was meant to
highlight the fact that “use values” point well beyond the uni-verse of “economics” with its “exchange value” toward the multi-verse of human values. That is why
Marx thought Proudhon’s famous motto - “property is theft” (more than just an
aphorism encapsulating Rousseau’s thesis in De
l’Inegalite’) - was so worthy of approbation. Yet even though the notion of
property is so obviously “legal” and requires of necessity the existence of a
State apparatus to enforce it, even Marx could conceive in his own “critique of political economy” that it
was possible to isolate the role of the State from that of “property” or “the
market” or “the economy” as an object of “scientific” inquiry. There are two
senses of the social category Value which reflect the Doppelcharakter of social resources identified by Marx. On one
side, we have Ethico-Political Value,
and on the other we have Economic
Value. Our thesis in this review of the role of the State in economic theory is
that these two meanings of Value are indeed inseparable – and that their
separation is only the product of the modern distortion of social and political
theory that comes with the rise of the capitalist bourgeoisie and of its
“science” par excellence – “economic
science”.
The isolation of Ethico-Political Value from
Economic Value requires the specification of a scientific sphere for the latter
such that its precise quantitative determination can allow the State to become technically neutral and to extrude all
other “values” from the sphere of economic value. This is the contrary of what
Habermas contends in Theory and Practice
where he equates the advent of the bourgeois State to the scientization of
politics tout court. Yet, as is quite
evident, the claim of liberalism is precisely the opposite – that is, to be
able to “free” the Political , not by scientizing it, but by isolating it scientifically
from the Economic. Liberalism does not pretend that Politics can be turned into a science; its
main claim and injunction on which the dictatorial rule of the capitalist
bourgeoisie is based is rather that Politics must not interfere with the
“science” of Economics. That is the entire rationale behind the homologation
of Politics and Economics behind both Classical and Neoclassical Political Economy – a free society and a
dictatorial workplace!
Here it is not just Habermas’s thesis about the
scientization of politics but even Constant’s distinction between the “freedom”
of Antiquity and the “liberties or guarantees” of Modernity that is neatly
surpassed and sidelined. Indeed, far from accepting that politics can be turned
into a science, Constant himself – the greatest theoretician of liberalism
after Locke - went so far as to claim that it is the “science” of Economics
that is the ultimate and perhaps most desirable or efficient “guarantor” of the
Political and of its bourgeois liberties
against the interventionist State: specifically, for the French theoretician,
it is the mobility of capital between
nation-states that is the most effective discipline and corrective against “interventionist”
States and governments: in other words, it is “the economic law of competition”
that disciplines governments!
The retreat of the citizen from active participation in the political life of the
State to the passive spectatorship of the bourgeois
is entirely justified by the scientization of the Economy that allows the ambit
of the Political to be confined to the sphere of public opinion. Habermas’s
entire enterprise is thus set on the wrong path in that it focuses on the
antinomies already evident in Hobbes regarding how the contractum unionis turns into the contractum subjectionis, - in other words, how the freely-entered rational
contract is possible given the inability of individuals freely and rationally to
control their desires. Liberalism does not rest on these antinomies because,
with Locke and then Constant, it already posits the possibility of a societas naturalis based precisely on
rational-scientific economic relations, on the scientisation not of Politics
(!) - as in Machiavelli, on whom Habermas relies to advance his thesis - but rather on strictly rational economic
behaviour, not of the ethico-political and ideological superstructure, but
rather of the reproductive and productive necessity of society (scarce
resources), not of the sphere of choice, but of the sphere of necessity – bourgeois
economics is the “science of choice”!
To be sure, following Aristotle, we must avoid the
identification of all social relations with those of “statality” – that is,
those relations that require the existence of a State. But our thesis here is
that there is no possibility of a separation of the Economic from the Political
or of a choice or trade-off between state
and market! The notion of “market” is
a fiction because the question is not one of whether human beings exchange individual labours but it is rather one
of how human beings organise social labour! (In this sense, Durkheim
is the perfect antidote to Adam Smith’s spurious derivation of the division of
“labour” – by which he meant “individual labours” – from exchange. Had Smith
started instead from the notion of social labour, he would have understood that
indeed it is exchange that is made possible only by the fictitious and coercive
parcelisation of social labour into individual labours!)
Bourgeois economic science since Adam Smith is
founded on the spurious conundrum of economic co-ordination: it asks, how is it
possible for self-interested atomic individuals to co-ordinate their activities
so that exchange is possible between them? And the obvious answer – which
condemns all neoclassical theory to irrelevance – is that it is utterly
impossible for self-interested atomic individuals ever to exchange or to
co-ordinate anything at all with one another! As Robert Clower has properly
pointed out, there can be no “market” as theorised in all neoclassical equilibrium
theory – because there is no meaningful “market process” between human atoms:
even Walras’s tatonnement does not
amount to market process because prices are not final until all “markets” clear
and general equilibrium prices are reached. The question from which we must
start instead is the exact opposite: how is it possible for human beings who
are species-conscious beings ever to create a society that enforces
individualism on them? This is what Rousseau did when he inverted the question
of the existence of “property”: instead of assuming that property rights are
“natural”, he asked: how and when did “property” become a social reality?
Similarly with “statality”, we ask not how the State arises from civil society,
as if the two spheres were insuperable antinomic metaphysical entities such as
“body” and “soul”, because there is no solution to a problem set in these
terms. Rather, we must ask how a society of private individuals can arise from
human species-conscious being.
Alchian-Demsetz, to give yet
another example of the rampant stupidity of Nobel Prize laureates in economics,
quite incorrectly select a negative
definition of capitalism – the absence
of government in the economic process - and completely leave out the
“individual”:
The mark of a capitalistic
society is that resources are owned and allocated by such non-governmental
organizations as firms, households, and markets. [First sentence of
“Production, Information Costs and Economic Organization”.]
This is quite clearly nonsense
because, in practice and in reality, governments have historically played a
crucial role in “the ownership and allocation of [social] resources”; and in
bourgeois economic theory, it is individuals,
not “firms and households”, that must axiomatically
take precedence over “firms and households and markets”! It is possible, of
course, that by “markets” Alchian-Demsetz mean the economic exchange of
atomistic individuals. Demsetz in any case will later take a fresh look at
competition as “perfect decentralization”, which requires the postulate of
possessive individualism (cf. above all his “Freedom and Coercion” and
“Fallacies in the Economic Doctrine of Externalities”). The locus classicus of “possessive
individualism” is, of course, CB Macpherson’s towering study by that name.
What makes the inversion of this age-old nexus
between State and economy ever more peremptory and pressing is the fact that
now more than ever we are witnessing how it is not the economy that is the
foundation of the State but much rather it is the “statality” of being human that is culpably obfuscated by “economic
science”. The great part of Aristotle’s study on the State, the Politics, is devoted to what he deems to
be its foundation – the oikos or
household whose “regulation” or “laws” (nomia)
lend the name to present-day economics (oiko-nomia).
Since Aristotle, and then thanks to his influence through Antiquity and the
Christian Middle Ages, it is the laws of the household that found the reproduction of human society intended
as societas civilis and not vice versa – that is, it is not the
“statality” of human being that founds economics. With Aristotle, “the freedom
of the ancients” answers to the physis
of human beings – the zoon politikon.
This is the active side of the animal
sociale in that human beings seek ful-filment
in Politics, in the State. Hence, the State is the ethico-political perfection of its citizens in the sense
that the State’s ethico-political dimension, quite distinct from its police and
military functions, is an emanation from the citizens as animalia rationalia (rational animals) distinct from other animals
by the faculty of language and therefore of reason.
In Aristotelian metaphysics, the “nature” (physis) of an entity is to pro-duce or
generate its “purpose” (telos). The
nature of an entity is that without which that entity could not exist: the
progeny of an entity is the telos of
its physis. Hence, it is in the
nature of the household to give rise to the State. The State exists because it
is the ec-sistence of the household: the State is the telos of the household. The State is the telos (purpose) of the family household as the “natural”
reproductive unit whose “nature” or physis
it is to bring forth the State. But the nature of the household itself is constituted
by that without which human beings could not exist – the union of man and
woman. That is why for Aristotle it is not the individual but the household
that takes precedence – because no individual could exist without a household.
In turn, Aristotle contends, the household could not exist, would not be
self-sufficient, without its more developed progeny – the State.
Yet, it is not the State that sanctions the
rationality and ethico-political perfection of its citizens but it is the
citizens who ful-fil and per-fect themselves by establishing the
State. In Aristotle’s theory, the citizens play an active role in the formation and life of the State understood as a
polity founded on the household as its natural reproductive unit. But they
achieve this perfection only in the ethico-political
sphere, not in the reproductive and economic one of the household! Because the
State is perceived as an agglomerate of households, so far as the reproductive
and economic spheres are concerned, the State serves merely as an adventitious
mechanical instrument of protection against internal disruption (police) and
external enemies (army). There is no “statality” in the sphere of social
reproduction which is left entirely to “the household” - except where the
household threatens social peace by exceeding, by going beyond, the bounds of
its reproduction and thereby defeats the pursuit of the ethical ideal of the
good life.
However much Aristotle may insist on its
“self-sufficiency”, the State does not play a reproductive role in the society
he describes given that its scope is limited to internal and external order. Here
the ambit of the State, its role in society, is merely confined to the ethical
one of “temperance and liberality” on the active side, and of policing and
defence on the negative side. But in the first case the State turns out to be a
wholly ideal, moral and ethical entity, and in the second case a purely
mechanical and militarist one. There simply is no organic nexus between the
existence of the State and the needs of households – there is no “statality” in
the households which are presented instead as self-contained and “self-sufficient
units”! Despite his contention to the contrary, the household Aristotle
describes exists only ontogenetically,
that is to say, it is capable of subsisting
independently of the State! In
reality, it is painfully evident from Aristotle’s exposition of his political
theory that the interests of the household in expanding its genetic and
territorial reach – its telos of
“populating the earth” - will inevitably threaten the integrity of the State as
a regulator of households and as a defender of them against external threats –
because the expansion of households will make the State liable to internal
dissolution if it is uneven and also necessarily to external attack if it is
excessive – except for the entirely “idealistic and moralistic” Aristotelian
prescription of “temperance” and “liberality”.
What makes Aristotle’s theory of the State
idealistic and voluntarist is the fact that the interests of households and
State do not coincide – which is why Aristotle has to appeal passionately to
the extrinsic philosophical ideal of “living well”. Of the two aspects of the
good life as prescribed by Aristotle, one, temperance (phronesis or prudence), shrivels into a pious renunciation of
profiteering by privileging use values over exchange values, whilst the other,
liberality or the pursuit of excellence in the arts, degenerates into the
cynicism of “knowledge is power”.
The incompatibility of the interests of the
household in expanding its family and possessions and that of the State in
regulating this impulse by means of the philo-sophic “ideal” of phronesis is made painfully evident by
Aristotle’s invocation of it as a cure for the intrinsic ills of the household
economy and its inevitable descent into the blind pursuit of wealth on which
the Greek city-state was founded to its unavoidable detriment and undoing. Thus,
the State in Antiquity was bound to remain a superstructural entity that was
understood only in its ethico-political but not in its metabolic reproductive
dimension. The State legislates only over the policing of autonomous households in their relations inter se and over the defense of the polity because the households
have no organic relation to one another: their interests inter se and therefore
vis-à-vis the State are neither co-extensive nor harmonious – in fact, they are
antagonistic. As a result, even the apparent dis-interestedness of leisurely
philosophical pursuits which are the deliberative active foundation of the
Greek city-state is ultimately dependent on the material “economic” ability
of the household to support its master, the citizen who forms the State. But
given the obvious antagonism between the material interests of individual
households, this “economic” side of the State will never suffice to secure its
survival as a free deliberative assembly of citizens! Aristotle fails to apply
to his own political theory the critique that he deploys to dismiss Plato’s
attempts in the Republic and the Laws to prescribe the forms of external
intervention of the State on the autonomy of the household: given that the
household remains the fundamental unit of the State and households have
conflicting interests, it is impossible for the State to reconcile the
divergent interests of households except in an idealistic and moralistic sense
prescribed by phronesis.
Indeed, as Marx’s and other historical analyses of
the ancient economy have shown (Karl Polanyi, Moses Finley, Perry Anderson),
Aristotle’s impassioned defence of the household and virulent condemnation of
“wealth-seeking” is disarmingly moralistic or velleitary in that the
“speculation” of chrematistics (commerce for the sake of profit) which so
obviously endangers the survival of the Greek economy based on the household,
can only be “tempered” by the pursuit of “the good life” or “excellence”
epitomised by the love of wisdom or philo-sophy. But given that the speculative dis-interestedness of
philo-sophy is supported materially by the “speculative” pursuit of wealth by
the household (chrematistics or finance), it is quite simply impossible for
philo-sophy, the real source of phronesis, to restrain its material speculative
counterpart in the chrematistics blindly pursued by the household!
In Aristotle’s political theory, economics (the law of the household) is
distinguished from chrematistics (the
pursuit of abstract wealth for its own sake). Just how inconsistent and
specious Aristotle’s plea for temperance and just how deficient his theory of
the State are can be inferred from how the philosophical “speculation” that
supposedly leads to temperance and liberality – to phronesis – rapidly and inexorably degenerates into the financial
speculation that he so vehemently decries, in the example of Thales, the
philosopher who, when reproached by his peers for wasting his time on pointless
philosophical “speculation”, determined to show how knowledge can turn into power
by “speculating” on the market for the production of olive oil by monopolising
olive trees and oil-making equipment at a time when prices were low only to
make a fortune by selling when prices rose. The fact that knowledge (sophia) can demonstrate its power only
by turning from philosophical speculation to financial speculation (chrematistike) shows just how
contradictory and pathetic Aristotle’s pleas for temperance and liberality –
for “living well” – are, because they are founded on his incomprehension of the
inevitable inconsistent dynamics of the Greek city-state founded on private
households. Here, the “speculation” of philosophy insidiously turns into the
“speculation” of chrematistics just as swiftly and inevitably as the law of the
household, economia, was bound to
turn by its internal contradictions into that of “finance”, chrematistics, and
thereby come to threaten the very existence of the Greek city-State! (In
similar vein, Ernst Mach in Erkenntnis
und Irrtum champions pure scientific research against its application for
gain.)
In his review of Classical
political theory in Theorie und Praxis,
Habermas is too pre-occupied with decrying the abandonment of the
ethico-political understanding of politics in Antiquity – which he, following
Arendt [in The Human Condition], is
very eager to praise - in the social theory of Thomism and the mechanistic
scientism of Machiavelli and Hobbes, and so fails to stress the purely
“idealistic/moralistic” or “voluntarist” nature of Aristotelian politics. This
is the limit also of Herman E. Daly’s “ecological economics” directed precisely
at this distinction between the household and chrematistics. Daly condemns
modern economics for promoting chrematistics by neglecting “economics” in the
Aristotelian sense (see hisThe Common
Good). He fails to see that economic science [chrematistics] can return to
the use values of the household only once “the household” itself has
disappeared with the abolition of the individual labours of the wage relation.
Daly sees “the irrational pursuit of wealth or exchange value for its own sake”
– as did also Aristotle and Weber and the entire Scholastic opposition to usury
– but cannot explain why the “use values” pursued by the economics of
“households” have led inevitably to the exchange values of chrematistics and
therefore to capitalism and its “science”, economics! Thus, his call for a
return to the economics of the household, just like Habermas’s nostalgia for
Aristotelian politics, remains voluntaristic
because it fails to see that it is not “economic science”, or Habermas’s “scientized
political science” since Machiavelli and Hobbes, that is the problem but rather
the interests that lie behind the
imposition of the wage relation by the capitalist State and its “private
enterprise”.
Neither for Aristotle nor for Marsilius or Bodin –
the first theoreticians after Aristotle to inquire on the nature of the State
(Machiavelli clearly did not) until Hobbes - can the State change either the
“natural” or the divinely-decreed way in which a community reproduces itself.
But whereas for Antiquity the centrality of the household conditions the
ethical role of the State and thus allows the active participation of its
citizens in government, already with the political thought of the Middle Ages
the focus shifts to the preservation of social
peace in a historical context in which the household has been replaced by
the feud. Marsilius and Bodin reflect on a society in which the partition of
land by large aristocratic landowners is likely to degenerate into civil war
without the State’s correction of
corruptible human nature, not as in Antiquity as the forum or ecclesia for the per-fection of the ethical life of its
citizens but rather as the bridge or com-pletion
of the gap in social reproduction left by the antagonistic interests of
households that preserves or conserves social
peace by means of absolutist government – and the only question becomes one
of governance.
Though Bodin can conceive of a societas naturalis existing independently of the State, the
possibility of civil war and its descent into a state of nature makes the
existence of the State part of the divine natural order (as in the family
governed by the paterfamilias – cf.
Filmer’s Patriarcha) so that
obedience to the sovereign must be absolute.
Here it is the Ratio, the animal
rationale, that dictates absolute rule, and the Ratio is first derived from
and ascribed to the Divinity and then manifested in Nature. The absolutist State is justified by Reason and, in
turn, its actions become “reasonable” and incontestable – a legibus solutae (“ab-solute”, exempt from human law). For Bodin
as for Marsilius and Filmer, the State is a defensor
pacis founded on the natural or divine reproductive order of the monogamous
family and on the Biblical mutual distrust among human beings, the human
propensity to perpetrate evil following the Biblical account of the Fall.
The difference between Aristotle’s per-fection and Bodin’s correction (cf. Constant’s “freedom” and
“liberties”) will later become Hegel’s correct formulation of the question of
the State – that it must answer to the ful-filment of human beings and not
simply ensure their protection as defensor
pacis (where societas naturalis
is possible) or creator pacis (a restauratio ab imis, where the state of
nature, either original [Hobbes] or degenerate [Rousseau], is corrected by the status civilis to found the societas civilis ). In modern political
theory the sphere of social life to which belong all social relations
independent of the State is known as “civil society” (cf. A. Ferguson, An Essay on Civil Society on which Adam
Smith relied for his “civilised society”), and the State is theorised as the
institution that complements civil society by “com-pleting” or by “preserving”
or “conserving” it – by supplying the “order” or “law” or “administration”
without which civil society would not be able to govern itself not in an
“economic” sense but rather in a “political” sense given that the Political, in
marked contrast to the Economy, is the sphere of public opinion and therefore
of unquantifiable and often irrational beliefs. For those political theories
that see civil society as a self-sustaining sphere for which the State provides
merely a “guarantee” of social peace (Locke, Constant), the State is seen as a
“defensor pacis” in that it merely
“defends” a social peace that is inherited either from divine sources
(Marsilius, Bodin), or from “natural rights” (Pufendorf, Grotius and Locke).
For those theories instead for which the State provides the very legal and
political foundation indispensable for the establishment of civil society
(Hobbes, Spinoza, Rousseau), the State is seen as a “creator pacis” – a veritable “deus
mortalis”, (cf. C. Schmitt, The
Leviathan); it is the mechanical resultant of the natural physical conflict
between atomistic individuals in the state of nature (status naturae) that precedes the civil state (status civilis, cf. Hobbes and the negatives Denken from Schopenhauer to Nietzsche and the Austrian
School).
The basic building blocks of the State for classical
political theory from Aristotle onwards are almost exclusively ontogenetic, in the sense that the State
is seen as the political pro-duct or construct of more basic elements such as the individual, the family
household, the group or tribe or village (oikos,
vicus), the city (polis, civitas),
and finally “the people” or nation – hence, the nation-State. Even in those
political theories that identify the State immediately with society or civilisation
as societas civilis as against a pre-statal
societas naturalis, the “statality”
of human being is never considered. There is never a suggestion that the State
may actually be a necessary precondition of human being, of being human in a phylogenetic sense, in the Marxian sense
of “species-conscious being” (Gattungs-wesen)
or that the State is an essential element in the metabolic productive capacity
of a society. The State is thought to be fundamental to the establishment of
the societas civilis not because of
the phylogenetic attributes of human being but rather merely to prevent the degeneration and descent
of natural society into civil war (Locke) or else to exit a hypothetical or primordial state of civil war (Hobbes).
[Nor does classical political theory even envisage
the contrasting possibility that the State may “contain” - in the sense of
limiting, hampering or even stifling - the productive forces of civil society
except as an aberration and degeneration of the “true” political role and goal
of the State. Even in the negatives
Denken (Schopenhauer, Nietzsche, Kierkegaard, Weber and the Austrian
School), where the role of the State is the “negative” one of creating or
maintaining the salus publica (social
peace), and even in its liberal counterpart (Locke, Constant, Maine, Bastiat),
the State is not seen as the source of social conflict but merely as the
necessary guarantor of social peace. Only when the State deviates from its
scientifically required neutrality from civil society does it interfere with
its productive, and specifically its economic, potential. An even more negative
view of the State is adopted by Marx and Schumpeter for whom the State actively
stifles the creative productive potential of civil society.]
To the extent that the reproduction of social units
is identical with the broadly “political” aspects of social life, as societas civilis or civitas or polis, then it
is indistinguishable from the status
civilis that follows the exit of humanity from the state of nature into the
State itself. But to the extent that this status
civilis begins to be differentiated from the reproduction of independent
social units that may or may not coalesce into a State, then the State is
distinct from this preceding civil society. This tendency to draw a clear
distinction between social interaction or social relations, on one side, and
social reproduction or social relations of
production, on the other side, only becomes prominent once the notion of
“labour” intended as “individual labour” as a separate source of social wealth
is isolated from other forms of social interaction, from Hobbes and Locke until
the definitive culmination of this social theory in Hegel and Marx. With Locke,
for the first time in human history the notion of a societas naturalis is separated from that of a societas civilis or the State in that the possibility is canvassed
of a status naturae in which
relations between individuals are possible although unstable either in a state
of civil war or in one that can degenerate into one. By contrast, in all political
theory prior to Hobbes and Locke only the possibility of stasis or civil war,
the bellum omnium contra omnes, could
be countenanced, but never that of a state of nature historically prior to or analytically distinct from the status civilis or the societas civilis. Hobbes allows only of
a status civilis that is founded by
the State by institution and not by acquisition because his status naturae allows of no possible societas naturalis independent of the
State. This exposes Hobbes to the objection that his State, a deus mortalis that creates social peace,
is incapable of explaining how this status
civilis came about – for if human beings are capable of a contractum unionis it is not clear why
this should become mechanically a
contractum subjectionis. Hobbes’s State is homologous to the Walrasian
state of equilibrium in that it is entirely mechanical and static and allows
for no historical metabole or
development.
It is thus that “civil society” as the repository of
all economic as against merely
socio-political or ethico-legal relations is neatly isolated from the State as
the political pro-duct and mere legal guarantor, not the creator or founder of
civil society either in its ethical (family, tribe, social values and goals) or
strictly economical aspects (market exchange, production). Because for the negatives Denken, as the true
theoretical matrix of liberal bourgeois politico-economic theory, the proper
function of the State is to ensure the untrammeled operation of the “self-regulating
market” and the “laws” of competition (“the level playing field”), any
interference by the State with these “laws” through the imposition of
extraneous “political” or “ethical” goals is denounced as improper in that it
transgresses against individual rights, or even as unscientific in the sense
that it distorts the quasi-mechanical “economic” choices on the part of
individuals.
Even for socialist economic theory, in which it plays
obviously a central role, the State intervenes only to plan and to co-ordinate
individual economic choices in the interests of society as a whole so as to
spare it from the deleterious effects of capitalist “anarchy” in which short-term
self-interests are placed before long-run economic and social welfare. In other
words, for socialism, and even for Marx, “the economy” and “social
reproduction” are still realities separate
from the State on which the State can intervene only in an ethico-political or
“super-structural” capacity (liberalism) or in a scientific capacity (socialism
and Marx’s dictatorship of the proletariat) correcting the anarchy of
individual actions so as to maximise the public good or social welfare (cf.
Pigou, Lerner, Dobb), but not in a fundamental manner as an essential part of
those “social relations of production”.
The schism, the Great Divide, in economic theory is
always between the methodological individualism of the negatives Denken – society and the economy are products of
spontaneous individual choices for which economic theory can only provide
rational alternatives (a mathematical “proof of existence” [Walras and
equilibrium theory] or a “science of choice” [von Mises, Hayek and Robbins]) –
and the methodological objectivism of the Sozialismus
for which social choices must be imposed scientifically and collectively on
individual members. But crucially in both instances – whether for individualism
or for collectivism – the State does not figure as a fundamental,
indispensable, constituent ingredient of the scientific and practical spheres
of economic action. For both liberalism and socialism (and even for most
“Marxisms”), the economy is an Object
(a neo-Kantian “thing-in-itself”) of scientific inquiry whose operation can be
determined “objectively”, scientifically, for the benefit of its individual
members – taken ontogenetically as “in-dividuals” – in accordance with the Law
of Value, that is, by acknowledging and positing the supreme “truth” that
economic relations are rationally
(logico-mathematically) quantifiable
either in a relative sense (Value is
the mechanical resultant of the “haggling” or conflict of atomic individuals
with subjective self-interested utility schedules, as in Neo-classical
equilibrium theory) or in an absolute
sense (socialist-Marxist notion of Value as “socially necessary labour time”).
Up until Adam Smith
set out to formalize the operation or functioning of “the market”, economics
had not existed as a “science” separate from theories of society or indeed of
“the body politic”. Yet in this very separation
of “economic science” from other aspects of social life and from its history
lies the fatal flaw of this “science”, because once its methodology leads it to
exclude non-economic social forces as
“exogenous factors” or as “externalities”, then it becomes a “closed system” of
pure logico-mathematical relations in which “economic facts” are completely
deprived of all sociological and environmental content (of what Schumpeter
called “extra-economic effects”). Consequently, “economic science” is incapable
of (a) specifying the content of its
subject-matter and (b) explaining historical
change, including the transformation of economic reality itself, totally
extruding thus from its scope both the “value” (in both senses of the word, the
economic and the ethico-political) of its inquiry and the very “positive
empirical experience” on which it is supposedly founded.
In his review of Comte and Mach,
in Knowledge and Human Interests,
Jurgen Habermas emphasises one aspect of positivism as his crucial objection to
it - namely, that positivism as a philosophy of science is incapable of
understanding and explaining the “historical evolution” of “science” itself. We
partly agree with Habermas; but this can only serve as an “internal” critique
of positivism in terms of its internal consistency, whereas as we will discuss
more fully below this type of criticism of positivist methods entirely misses
the point about their “external” real practical political effectuality! In
short, Habermas criticizes positivism in the name of “science”, when in fact
bourgeois “science” is a real political practice that cannot be “contradicted”
in purely “scientific” terms! “Science” simply does not have the politically-independent
epistemological status that Habermas’s neo-Kantism assigns to it – as Max Weber
showed conclusively, although only obliquely (cf. “Objektivitat” and “Science
as Vocation”).
Put in simpler
terms, science as praxis must be able to justify its intrinsic human interest
and it must combine theory and facts: science without human interest is abulic
or harmful; theory without facts is empty, and facts without theory are blind.
But the “facts” that “economic science” pretends to theorise are the very violent
reality that the capitalist bourgeoisie has already imposed on human society!
Bourgeois economic science therefore pretends merely “to observe empirically”
its misdeeds or “facts”, and then to dress them up as “human nature” that gives
rise to “natural human rights”. This miserable combination of scientific positivism and ethical jusnaturalism is the very essence of
bourgeois economic science! At the hands of positivism and empiricism, the Statik of equilibrium theory contradicts
the Dynamik of capitalist reality:
hence, equilibrium expels history, stasis stymies metabole,
necessity chains freedom. How then to reconcile these irreconcilable opposites? How
to evade and escape these antinomies and apories?
This cardinal quasi-Euclidean axiom of the absolute
atomicity or in-dividuality and self-seeking self-interest of human beings is
the most indispensable postulate of all bourgeois social, economic and
political theories. Fittingly, it was
the English translator of Euclid’s
Elements, Thomas Hobbes, who first
devised this worldview. In this worldview, there is no space for common human
interests (inter esse, common being):
the syllogistic conclusion is that “freedom” can be defined and exist not as a
common human goal but only as “free-dom”, that is to say, as an equilibrium of
opposing, conflicting and irreconcilable individual wills. This equilibrium,
the equilibrium of Greek stasis or
civil war (bellum civium), can be overcome by political
convention (totalitarian, democratic or elitarian) only because the atomized
human individuals postulated in Hobbes’s theory know that the only outcome of
such static equilibrium, of this stasis,
will be the war of all against all (bellum
omnium contra omnes) that will lead fatally (fate here turns into death) to
the extinction of humanity. Even in its “free-dom” - indeed, as Weber had
shown, especially in its “free-dom” –
human action and leadership will obey that “conditioning” constituted by the dira necessitas (the dire necessity),
the extrema ratio of self-preservation.
The ultimate foundation of mechanical rationality both for the Hobbesian
political system and for its neoclassical progeny in equilibrium theory is
quite simply self-preservation, the “dire necessity” of surviving in the state
of nature where homo homini lupus,
man is a wolf to man. Free-dom consists not in acting irrationally but in
acting rationally: in short, that decision is “free” that is taken rationally, by respecting the “precise relationship” between subjectively
intended ideal goals and the objective
“con-ditions”, the available means, for the implementation of those goals
starting from the axiomatic postulate of the irreconcilable self-interests of
individual human beings.
This is how Hobbes
managed for the rising capitalist bourgeoisie an epistemological feat that has
not been equaled since he wrote: - he managed, that is, to combine the
positivist scientific hypothesis of
Galileo-Newtonian mechanics with the jusnaturalist political convention of innate human rights, and thereby to erect bourgeois
political practice on effectual scientific grounds. Hobbes begins with the positivist scientific hypothesis of the
“universal conflict” between human beings taken as wholly egoistic atomic
individuals, and from there he develops “rationally” - with the “rationality”
of the “laws” of mechanics - the jusnaturalist
political convention (common-wealth) that will make social life possible based
on the “natural rights” of these conflicting individuals. (This astute twining
of positivist authoritarianism and jusnaturalist contractualism is masterfully
unjumbled by N. Bobbio in Da Hobbes a Marx.)
In order to erect
his political theory, Hobbes starts from the Euclidean axiom that each human
being represents a “point” or “body” entirely unconnected to other human
“points” or “bodies” and entirely self-interested or, mechanically put, having
its own momentum or “appetitus” or “conatus” – which Hobbes calls “Power”. From this axiom he deduces that
the original, most “natural” state of human beings, the “state of nature” or status naturae, is a state of civil war
(bellum civium) or “the war of all
against all” (bellum omnium contra omnes).
This “clash of wills” or appetites, this “war of all against all”, can lead
logically only to a deterministic mechanical
equilibrium in which there is no “room
for manoeuvre for the individual freedom of the will” (Schumpeter quoted
above) because each individual will is bound by the wills and boundless
appetites of other wills, or else to the assured self-destruction of human
beings. This is Hobbes’s scientific
hypothesis taken directly out of Galileo-Newtonian mechanics.
The way out of
equilibrium or stasis is provided by
the ultima ratio, the absolutely
indispensable right to and need for self-preservation, which leads these atomic
self-interested individuals to reach freely
a political con-vention, an agreement or “social contract” that can avert
mutually assured destruction. Here the positive
empirical evidence of a society that the bourgeoisie has reduced coercively to little more than a moral
jungle from which all notion of “natural law” has been expunged meets with and
satisfies the jusnaturalist
(natural-law) requirement that individuals must agree freely and rationally to a political regime that will protect them
from civil war. Hobbes acknowledges that what coerces individuals to accept
this bourgeois political regime based on “the laws of the marketplace” is the metus mortis, the fear of death at the
hands of any other individual. And given that each individual is axiomatically
defined as being “equal” in the ability to harm another in the state of nature,
then it follows axiomatically that each individual decides freely (by political
convention, otherwise known as “social contract”) and rationally (by scientific hypothesis,
following the definition of in-dividuals in conflict) to erect a “common
wealth” or State or status civilis
that will protect them from certain death.
The central feature
of capitalism is that the bourgeoisie has tried as far as is humanly possible
without tearing asunder the very fabric of human society to reduce this society
to the state of absolute possessive individualism. That is why all accounts
of bourgeois economic theory must start with the axiomatic postulate of this
possessive individualism. Hobbes did not neglect to include in the “possessive”
part the ability of individuals to buy or sell their own “power”, meaning both
their physical possessions and their labour-power, in exchange for physical
possessions. In the Leviathan, he
describes “the value or worth or price of a man” as “so much as would be given for the use of his power”. Clearly, Hobbes had already an embryonic notion of
what Marx would theorize later as “labour-power”, the commodified form of
living labour in capitalist industry.
As Loasby has very
perceptively pointed out (in Equilibrium
and Evolution), the “complete decentralization” of economic decisions that
is implicit in Hobbesian political theory and then in Walrasian equilibrium
economic theory makes the co-ordination of economic decisions “a matter of life
and death”. This is indeed another factor that makes the Hobbesian-Walrasian
schema or blueprint absolutely axiomatic for the analysis of capitalism. But
this interdependence of human economic action is still subordinated to the
axiomatic primacy of individual self-interest; consequently, it cannot form
part of equilibrium theory except as a Hobbesian ultima ratio or dira
necessitas ob metum mortis, dire necessity in fear of death, as we
explained above.
Make no mistake: the Hobbesian mechanical science we mean here is not an “objective
science”, - for as Nietzsche demonstrated, there is and there can be no such
“thing”! The science we intend here is a
political practice based on the inflexible application of axiomatic rules to
human society by a historically specific social class – the capitalist
bourgeoisie. It was Max Weber who undertook the monumental project to
separate the spheres of “value-rationality” whereby ends can be adjusted and
connected rationally to available means and “purposive rationality” whereby
means can be adjusted and approximated to chosen ends that remain irrational by
definition. The bourgeoisie would be blind deaf and mute without this
inflexible science, which is why it has erected the most fabled monuments to
it. This science consists for the bourgeoisie in placing political decisions in
a precise relationship to the
existing relations of power in society that it has imposed to its own advantage
so as to be able to reproduce them according to its own axiomatic postulates or
schema. And then, of course, in presenting these political decisions as “that peculiar jumble of conditioning and freedom,
which economic life shows us”, which is how Schumpeter defines “economic
science”.
For both Hegel and Marx, the category of civil
society, at least in its economic dimension as burgerliche Gesellschaft, as bourgeois society, becomes quite
distinct from that of the State in that the State is pro-duced by civil society. But for Hegel this antithesis of bourgeois and citoyen can be resolved only if the State can be reconciled with
the ethicity of civil society. For Marx, instead, the resolution of the
antagonism of civil society will result in the “withering away of the State”,
in its atrophy. Here we can see how Hegel still posits a “staticity”, an
ethicity that encompasses or contains the Economic and therefore cannot be
attained solely through the Economic. For Marx – again, contrarily to Hegel –
the contradiction of bourgeois and citoyen can be superseded only through the
economic sphere of civil society, whereby the super-structural State is
rendered super-fluous, and thereby decays or withers away, once the
contradictions of capitalist social relations of production that obtain in
civil society are resolved.
In this sense, whereas Hegel still – quite rightly!
– insists on the need for civil society to become reconciled with its
“staticity”, Marx denies that this Ethico-Political “superstructural” sphere of
the State can ever play a role in the extrinsication of the dialectical
antagonism of civil society and of the wage relation – because it is merely the
epi-phenomenic, super-structural pro-duct of the real source of social
antagonism whose resolution lies in the “scientific” rectification of social
relations “of production”, that is, still in the sphere of “alienated labour”
understood as “materially exploited labour” through the “theft” of labour-time
and labour-power, of “surplus” value! This kind of “Automatik” does not exist in Hegel, despite the “speculative”
character of the dialectic denounced by Marx already in the Paris Manuscripts and in the early Critique:
“Hegel is not to be blamed for describing the State
such as it is [which in any case will be “absorbed” by civil society in
“communism”], but rather for presenting the existing State as the ideal State”,
which, for Marx, clearly is an impossibility both because the existing State is
not “ideal” and because the “ideal” State is one that will be abolished!
There are two types of “eschatology” (“prophecy” for
Schumpeter) in Marx, then: the first is in the Manuscripts where the overcoming of alienation still incorrectly intended as “objectification” (!) is a necessary
final stage of human history; and the second is in Zur Kritik where the supersession (Auf-hebung) of alienated labour is the final outcome of the
“scientific” abolition of wage labour within civil society and, with it, of the
State superstructure as well. We say that this is “eschatology” because Marx
fails to see Hegel’s correct positing of the problem: - namely, that
“staticity” must be reconciled with “subjectivity” and that the former
necessarily re-defines the Economic as a category that must also be
Ethico-Political in nature. It is impossible for Hegel to accept the Marxian
separation of structure and superstructure because the two could never be
“separate”. It is possible, thanks especially to the Grundrisse, to rescue Marx’s schematic schism – or simply
schematicism - of base and superstructure by arguing that this “mechanical”
dichotomy applies only to the “pre-history” of humanity in the sense that once
alienated labour is abolished, then Ethicity and Economy will be reconciled.
Still, as Arendt (Between Past and Future) and Habermas (Knowledge and Human Interests) have insisted
- in too “idealist-phenomenological” and “neo-Kantian” a fashion, respectively
-, Marx had always the tendency to reduce the question of alienated labour to
the “materialist” one of “the theft of labour time”. What seems closer to
reality instead is that the discipline of labour-time – or better, “the wage
relation” – is the specific form of social violence perpetrated by the
bourgeoisie – what makes it “capitalist”: but the fact that it is “violence”
means that there is only a political basis to the wage relation and to
“economic calculation” – and most certainly not a “scientific” one!
Indeed, to the degree that the wage relation is
increasingly less able to measure accurately the level of social violence
needed by the bourgeoisie to perpetuate its command over our living activity,
to that degree the neat division between Economic Value and Ethico-Political
Value is dissolving. The entire recent experience of central-bank monetary
intervention to maintain the financial pyramid through quantitative easing
certainly points in this direction – that is, the inability of capitalist State
authorities to control the “market price mechanism” of various “assets” in
terms of profitability, and therefore ultimately in terms of the “binding and
biting discipline” of the wage relation at a societal level.