Commentary on Political Economy

Wednesday 15 January 2020

PROLEGOMENA to the Study of Capitalism as a Social System

Capitalism is a social system. This means that it operates according to rigid rules that preserve its existence (reproduction) and do so on an expanded scale (accumulation). But how can such a system function, not just in actual fact, but as a co-ordinated, organised system? In other words, how is capitalism even possible? This question requires a socio-theoretical framework that is as much epistemological as it is political. – Which is why we are calling these theoretical explorations “Prolegomena”, just as Kant did entitling his propaedeutic work in answer to Hume’s scepticism to explore the possibility and boundaries of all metaphysical speculation.
The inadequacy of all bourgeois exegeses of capitalism as a system are revealed by the very contradictoriness of their description of this system as a “market mechanism”. For how can a “market”, which is implicitly based on the free will of its participants, ever give rise to a “mechanism”, which is obviously independent of free will? And is not the “freedom” of the “free market” defined by all equilibrium economic theories from Adam Smith to Kenneth Arrow as a series of conditions that must result in economic equilibrium – and thus in the notion of a “self-regulating market”? But then, if so, the entire ideological legerdemain of bourgeois economic theory is revealed! The “market mechanism” is either “free”, and then it cannot function as a “self-regulating mechanism”, or else it is a “mechanism” in which it can be neither “free” nor” self-regulating”!

 And upon this it was, that when I applyed my Thoughts to the Investigation of Naturall Justice, I was presently advertised from the very word Justice, (which signifies a steady Will of giving every one his Owne) that my first enquiry was to be, from whence it proceeded, that any man should call any thing rather his Owne, than another man's. And when I found that this proceeded not from Nature, but Consent, (for what Nature at first laid forth in common, men did afterwards distribute into severall Impropriations), I was conducted from thence to another Inquiry, namely to what end, and upon what Impulsives, when all was equally every mans in common, men did rather think it fitting, that every man should have his Inclosure; And I found the reason was, that from a Community of Goods, there must needs arise Contention whose enjoyment should be greatest, and from that Contention all kind of Calamities must unavoydably ensue, which by the instinct of Nature, every man is taught to shun. Having therefore thus arrived at two maximes of humane Nature, the one arising from the concupiscible part, which desires to appropriate to it selfe the use of those things in which all others have a joynt interest, the other proceeding from the rationall, which teaches every man to fly a contre-naturall Dissolution, as the greatest mischiefe that can arrive to Nature; Which principles being laid down, I seem from them to have demonstrated by a most evident connexion, in this little work of mine, first the absolute necessity of Leagues and Contracts, and thence the rudiments both of morall and of civill prudence. (De Cive, Dedication.)

Two forces exist for Hobbes, then; one opposed to the other – one natural that involves irrepressible self-interest, and one rational that seeks to avoid the internecine civil “war of all against all” that will lead to mutually assured destruction. All human laws and “rights” are strictly conventional because they are the result of human rational consensual agreement. But these conventions arise from the realisation that not having them, that failure to agree and decree such laws will result in the complete irreversible dissolution of society. The Euclidean axiomatic logic that leads Hobbes to this conclusion is inconfutable. Hobbes here uses Logic to establish an Iron Law – a Hypothesis – on which all human Conventions must be founded and from which they can be derived or deduced. Here Hobbes’s Euclidean geometric logic, invariant and inflexible, is brutally candid: it amounts to pure mechanical physics. With a few, pitilessly calculated propositions – more geometrico, like Spinoza -, Hobbes ruthlessly slashes and fells the pathetic apologetic assumptions of what was to become the “liberal ideology” first outlined by John Locke in terms of the “political regulation” of bourgeois society and then assimilated and extended to its “economic expanded reproduction” by Adam Smith.

Convention and Hypothesis. These are the two epistemological poles of the political strategy that makes the tyranny of capital systematic. Capitalism is a system, in the sense that it is political, yes, and therefore conventional in the sense that it relies on consensual institutions; but also in the sense that it is organised because it sets itself an external inflexible operational rule. This operational rule or hypothesis is also “conventional” in the broad sense that it is not an objective entity independent of human will and purpose, of human decision. But unlike convention, hypothesis is not consensual because it does not depend on agreement, because it is set unilaterally by specific human historical agencies such as the capitalist bourgeoisie that then impose it on other historical agencies such as the working class and the broader population.

The most essential, most crucial question surrounding the existence of capitalism as a socio-economic system was always this: how can a society organise itself around the seemingly independent, autonomous decisions of its individuals? How can the discipline of the capitalist factory be reconciled with the apparent free-dom of the market mechanism? And even there the oxymoron becomes apparent: how can the so-called “free” market function as a “mechanism”? Market and factory. Free-dom and co-ercion. Parliamentary democracy and liberal economy. Liberty and tyranny. Choice and necessity. Finally, Convention and Hypothesis. How to reconcile these opposites? How can capitalist “free” market enterprise become systematic?

A hypothesis is the ground zero of human decision-making. It is the rule that is set up in the event that social consensus breaks down, and that must be imposed once social consensus has broken down. In other words, a hypothesis is conventional in the sense that it is not objective, and yet it is not conventional because it is a Grundnorm, the Basic Norm or Law that guarantees the enforcement of the conventions on which a social system operates and functions even when these conventions have lost legitimacy and effectuality. Except that a hypothesis is not a “law” or a “norm” as such. Rather, a hypothesis is exemplified in the words of Carl Schmitt, “Sovereign is he who decides on the Exception”. A hypothesis is the conventional framework that takes effect when the breakdown of a social system requires a state of exception. Consequently, a hypothesis is also the convention on which the effectuality of all other conventions is founded, and from which all other conventions derive their effectuality. A hypothesis is the Iron Law of the bourgeois society of capital.

The question that Hobbes confronts is to examine how “self-interested individuals” in the state of nature can agree to reach a “social contract” that protects their “natural rights” under the law. In reviewing the theoretical foundations of the state of nature, Hobbes follows the pessimistic premises of the state of nature to their “scientific” natural conclusion. If in fact individuals are already self-contained, “self-interested” atoms in the state of nature, it is simply impossible for them to agree to the drafting of a social contract that erects a status civilis regulated by laws - for the simple reason that their “irreconcilable” egoistic interests would prevent such individuals from reaching any agreement at all! To argue otherwise is to postulate the ability of individuals in the status naturae to have the necessary requisite “faculties” (reason or some other inclination) that allows them first to discern and identify their “natural rights”, and second to agree to observe them.

But if such faculties already existed in individuals, then they would no longer be merely “self-interested”, in that they would implicitly be able to conceive of “the common good” in respecting their individual “natural rights”, and therefore the contractual establishment of a “civil society” would be quite superfluous. (Cf. Rousseau in Colletti, From Rousseau to Lenin, p.235.) In other words, for Hobbes the positing of a contractual “civil society” by “self-interested individuals” governed by laws that protect their “pre-contractual natural rights” is simply either a contradictio in adjecto (“status naturae” is antithetical to the notion of “right”) or else a petitio principii, in that erecting a State that protects “natural rights” under the law presupposes a “society” of individuals capable of accepting the legitimacy of those “natural rights”, which begs the question of why the State is needed in the first place, because in that case both “the contract” establishing the “civil society” as well as the State erected to enforce the laws would be simply redundant, superfluous.

This is the implicit and devastating critique that ought to have quelled once and for all the future confabulations of liberalism, starting with those of its founder, John Locke. Indeed, it is a measure of the British bourgeoisie’s self-confidence that Locke could erect his presumptuous fabrication of liberalism in the face of Hobbes’s devastating earlier critique! In Hobbes’s reasoning, no “self-interest” of individuals could justify or urge or prompt them to agree to the contractual establishment of a “civil society” except the metus mortis, the “fear of death” at the hands of other humans, the fear of being overwhelmed by other self-interested individuals in the state of nature. Either individuals are able to protect themselves from others in the state of nature, in which case they do not require a “civil society” or State, or else they are not, in which case it is simply impossible to speak – as all liberal theories do after Locke - of “natural rights”. Although the “conception” of such “rights” may be possible in foro interno by reference to some religious or ethical norm that all or most individuals may hold, in foro externo, in the reality of the status naturae, no such “rights” exist simply because there is no “power” that can apply “force” to have such “rights” observed by all individuals. (Koselleck, Kritik und Krisis, p.29, according to whom Hobbes proceeds “from the outside to the inside”, adapting the mediaeval Scholastic separation between ‘fora’.)
In other words, “natural rights” are mere “velleities” - empty and pious wishes existing “in foro interno”, they are a mere flatus vocis - in the status naturae. Only in a state of law or status civilis can “rights” exist in foro externo and acquire “positive” reality. The inescapable outcome is that “natural rights” cannot have any “social” reality except as “positive laws” enforced by a social political “power or sovereign” – the State. What can bring individuals together to agree to the contractual establishment of such a State is the only “right” that all “self-interested individuals” can possibly recognise: - the right to self-preservation. But it is essential to understand that this “right” for Hobbes exists only as a “scientific” description of the reality of the state of nature: in no guise is Hobbes attributing any ethical or moral validity to “self-preservation” as a “right”, because that is simply “inconceivable” in the state of nature.

Hobbes’s reductio ad absurdum consists in this:- that in the state of nature the only “right” conceivable and apparent is the brutal fact of self-preservation. And this is a fact that human reason, seen by Hobbes as a mere “instrument”, can recognise and act upon. For it would be impossible otherwise for individuals to let their reason prevail over their passions and therefore to agree to the “formation” of a contract or “league” in the status civilis founded upon the total “alienation” of the freedom of their passions in the state of nature. But above all it would be impossible for self-interested individuals to agree to any definition of “right” whatsoever, “natural” or otherwise! (Thus, Hobbes exposes ab initio what Koselleck called “die Pathogenese” of bourgeois society. But see also Arendt, Totalitarianism, c. p.45ff.)
Hobbes draws a distinction similar to Vico’s between the natural sciences that are based on empirical observation and experimentation by way of hypothesis and induction, on the one hand, and on the other the moral sciences that are based on human conventions and deduction – with the inference that, given that human beings are able to reflect by introspection into the workings of their own minds, they are far better able to determine “scientifically” the outcome of their “institutions”, political, economic and social, than they are to divine the regularity of natural events by experiment and induction (Piazzi cites Negri at p.16, also comments on link to Vico).

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