Commentary on Political Economy

Saturday 11 June 2016


Even in its highest, most sophisticated expression, liberalism points to its own dissolution. It was Benjamin Constant who best summarized the historical process whereby the State had been transformed from Antiquity to Modernity. To be sure, Constant fails to identify the specific role of the social production of wealth – from slave labour to serfdom (feudalism) through to wage labour (capitalism). Nonetheless, he catches admirably the key “political” difference between the ancient polity and the modern nation-state. The reason that he fails to identify the crucial difference between the capitalist mode of production and that of Antiquity is, of course, that from within his liberalist theoretical perspective, the economy is scientifically separate from the Political – and therefore the Political transformation of the State can be traced independently of the process of production.

Yet there is one aspect of economic activity – that of “commerce” – that Constant isolates as the crucial catalyst in this transformation. According to him, what has made possible the transfer of political power from the associated citizen to the liberal State is the rise of commercial activity whereby individual citizens have been induced to focus on their own private gain rather than on the standing of their nation against other nations and on the daily conduct of public administration.

Because commerce has made possible the overcoming of war over scarce resources through the exchange of goods, individuals within nations have preferred to pursue commercial activities rather than support their nation-states in wars aimed at wresting control over wealth from other nations by military means. Because of this, all individuals within nation-states have an interest in preserving social and international peace and indeed they have as great an interest in ensuring that their nation-state does not interfere with their private property as they have in ensuring that other nation-states do not confront their own State. Thus, commerce works in two ways – internationally, by ensuring that commerce replaces war as a means of obtaining and maximizing individual wealth, and nationally by limiting the power and function of the State to preserving private property. It turns out therefore that it is the market economy that ensures both the national liberties of individual citizens and international peace.

But commerce also has one essential function: by turning the energies of individual citizens inward toward the maximization of their personal wealth, commerce also favours the transfer of the exercise of political freedom from the direct involvement of individual citizens to “elected representatives” who are entrusted with running the machinery of State and, in turn, appropriate the political power and energy of citizens in exchange for the granting of maximum “liberties” to each citizen.

Thus, first of all, commerce replaces exchange with war, both nationally between individuals, and internationally between nation-states. Second, because of its emphasis on exchange and wealth maximization, commerce involves “calculation” and therefore it encourages citizens to require a rational State and also to delegate their freedom to the State through representatives because commerce and its calculation require much more complex social relations and services that individual citizens cannot oversee directly – hence the need for “bureaucracy” (cf. Weber’s cognate theory of the State as the product of capitalist Kalkulation and Rationalisierung in Parlament und Regierung).

Two developments, then, have conspired to remove democratic control by citizens over the State since Antiquity: the first is the rise of commerce which has reduced the power of nation-states in military conflict whilst at the same time it has turned citizens “inward” toward protecting their individual “private property” and to entrust the “elected representatives” and the State bureaucracy with the power to administer society and protect their “rights”. The second is the sheer size of nation-states which, unlike the ancient republics from Athens to Rome to Geneva, no longer lend themselves to individual citizen involvement in day-to-day politics.

Thus, from “active freedom” in the sense of participatory democracy, modern-day citizens have moved to minimizing their engagement in Politics but at the same time maximizing their “passive liberties” that the State is called to guarantee.

But what happens if the State fails to maintain such guarantees over the liberties of individual citizens? Two problems immediately arise in Constant’s theory of the liberal State. And these are problems that show conclusively why liberalism and democracy, far from being synonyms or even cognate terms, are in fact contradictory concepts, and why therefore “liberal democracy” is an oxymoron. The first problem that the liberal State, far from being neutral, is in fact bound to act to protect the private property of individuals – and therefore its social role is functional to the protection of the “rights” of wealthy citizens. As George Orwell might have put it, all citizens are equal under the law; but some are “more equal” than others – depending on their property holdings.

The second and related problem is that, depending on the “type” of property held by individual citizens, some citizens might find it easier to escape the control of the State – or, obversely, they may have more control over the State – simply by virtue of the fact that these citizens may hold the State to ransom as against other States! This danger is particularly acute and virulent in capitalist societies because the widespread existence of money and markets makes wealth particularly “liquid” and “mobile”. Here is Constant acknowledging in his own ideological liberalist terms the tremendous importance of this point!

Le commerce rend l'action de l'arbitraire sur notre existence plus vexatoire qu'autrefois, parce que nos spéculations étant plus variées, l'arbitraire doit se multiplier pour les atteindre; mais le commerce rend aussi l'action de l'arbitraire plus facile a éluder, parce qu'il change la nature de la propriété, qui devient par ce changement presque insaisissable. Le commerce donne à la propriété une qualité nouvelle, la circulation: sans circulation, la propriété n'est qu'un usufruit; l'autorité peut toujours influer sur l'usufruit, car elle peut enlever la jouissance; mais la circulation met un obstacle invisible et invincible à cette action du pouvoir social. Les effets du commerce s'étendent encore plus loin: non seulement il affranchit les individus, mais, en créant le crédit, il rend l'autorité dépendante.

L'argent, dit un auteur français, est l'arme la plus dangereuse du despotisme, mais il est en même temps son frein le plus puissant; le crédit est soumis à l'opinion; la force est inutile; l'argent se cache ou s'enfuit; toutes les opérations de l'État sont suspendues. Le crédit n'avait pas la même influence chez les anciens; leurs gouvernements étaient plus forts que les particuliers; les particuliers sont plus forts que les pouvoirs politiques de nos jours; la richesse est une puissance plus disponible dans tous les instants, plus applicable a tous les intérêts, et par conséquent bien plus réelle et mieux obéie; le pouvoir


menace, la richesse récompense: on échappe au pouvoir en le trompant; pour obtenir les faveurs de la richesse, il faut la servir: celle-ci doit l'emporter.

Par une suite des mêmes causes, l'existence individuelle est moins englobée dans l'existence politique. Les individus transplantent au loin leurs trésors; ils portent avec eux toutes les jouissances de la vie privée; le commerce a rapproché les nations, et leur a donné des moeurs et des habitudes à peu près pareilles: les chefs peuvent être ennemis; les peuples sont compatriotes.

In other words, as Constant’s wily analysis makes plain, it is the very spread of capitalist industry and therefore also of finance – it is the “world market” of capitalism that allows capitalists to play off, to establish a competitive tension, between different nation-states for investments so as to subtract themselves from any sort of “political” control, regardless of whether this control is democratic or not!

So in his own words, Constant is saying that the capitalist world market allows capitalists to elude the checks and balances that nation-states can impose on them by establishing a coalition of capitalist interests that run counter to the interests of the individual nation-states!

[L]e commerce a rapproché les nations, et leur a donné des moeurs et des habitudes à peu près pareilles: les chefs peuvent être ennemis; les peuples sont compatriotes.

The utterly and devastatingly anti-democratic bearing of Constant’s liberalist position could not be any more frightfully evident! The kind of “freedom” or “liberties” that Constant champions are to be subjected not to the “neutral” political control of the nation-state but rather to the control of capitalists by means of the nation-state! It is not the democratic nation-state that controls private property; instead, it is private property that controls the nation-state in accordance with “liberal” principles: liberalism and democracy could not be more starkly opposed! This is the true and devastatingly terrifying implications of Constant’s liberalism, and therefore the theoretical endpoint of all liberalist political theory. Here is Constant again:

Que le pouvoir s'y résigne donc; il nous faut de la liberté, et nous l'aurons; mais comme la liberté qu'il nous faut est différente de celle des anciens, il faut à cette liberté une autre organisation que celle qui pourrait convenir a la liberté antique; dans celle-ci, plus l'homme consacrait de temps et de force a l'exercice de ses droits politiques, plus il se croyait libre; dans l'espèce de liberté dont nous sommes susceptibles, plus l'exercice de nos droits politiques nous laissera de temps pour nos intérêts privés, plus la liberté nous sera précieuse.

De la vient, Messieurs, la nécessité du système représentatif. Le système représentatif n'est autre chose qu'une organisation à l'aide de laquelle une nation se décharge sur quelques individus de ce qu'elle ne peut ou ne veut pas faire elle-même. Les individus pauvres font euxmêmes leurs affaires: les hommes riches prennent des intendants. C'est l'histoire des nations anciennes et des nations modernes. Le système représentatif est une procuration donnée à un certain nombre d'hommes par la masse du peuple, qui veut que ses intérêts soient défendus, et qui néanmoins n'a pas le temps de les défendre toujours lui-même. Mais a moins d'être insensés, les hommes riches qui ont des intendants examinent avec attention et sévérité si ces intendants font leur devoir, s'ils ne sont ni négligents ni corruptibles, ni incapables; et pour juger de la gestion de ces mandataires, les commettants qui ont de la prudence se mettent bien au fait des affaires dont ils leur confient l'administration. De même, les peuples qui, dans le but de jouir de la liberté qui leur convient, recourent au système représentatif, doivent exercer une surveillance active et constante sur leur représentants, et se réserver, à des époques qui ne soient pas séparées par de trop longs intervalles, le droit de les écarter s'ils ont trompé leurs voeux, et de révoquer les pouvoirs dont ils auraient abusé.

Notice how in the quotation above, Constant constantly and surreptitiously shifts from “les hommes riches” to “les masses” and “les peuples” as if these entities were one and the same thing! In reality, of course, the interests of the wealthy (capitalists in a capitalist economy) and those of “the masses” (mainly wage labourers in capitalism) hardly ever coincide – and certainly they cannot coincide where the democratic operation of Constant’s “representative government” is concerned: because such a government will obviously represent the interests of “les hommes riches” (capitalists) well before it protects those of “les masses”! And the interests of capitalists and workers cannot coincide for the very reason that Constant himself reveals – that “les individus pauvres” (workers) are too busy “working” for a living to be able to oversee and monitor the work of their “representatives”! As we have argued again and again here, the essence of capitalism is the violent enforcement of the wage relation whereby capitalists force workers to give up their political freedom as living labour “in exchange for” the product of their living labour – what we call “dead labour” or “wages” which are the monetary equivalent of dead labour.

(Wages cannot stand immediately for products – that would amount to barter and would nullify the essential role of money in capitalism, that is, to separate workers from the product of living labour so that they do not have any say into how their living labour is applied – what is produced, how and when – except, of course, as “consumers” who “choose” products imposed on them by the owners of the means of production – capitalists – at a “price” that perpetuates their subordination to capital.)

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