Spin Doctor: In The Invisible And Unaccountable We Trust No More
“Theocracy: government of a state by immediate divine guidance or by officials who are regarded as divinely guided.” – Merriam-Webster’s dictionary
source: http://www.ft.com/intl
Society has come a long way since the middle ages. No longer governed by divine right, Reason has been restored to human affairs. We inherited this society from our forefathers and promised to upkeep it, to improve and strengthen its open foundations. But we have overshot our target.
The problem can be seen in the area of the Economy. A close look reveals the birth and proliferation of a market-fundamentalist dogma that is taking over our lives, like theocracy did so many centuries ago. Only much faster.
Here’s the lowdown. Free-market economy rests on the following tenet: let the markets be and they will adjust themselves in the best possible way, as if an invisible hand is guiding their workings. Adam Smith, founder of market capitalism, said so in so many words in his book, On Capitalism.*
The notion is wonderful and groundbreaking, perhaps the cornerstone to modern society and a better life. When first introduced, it worked wonders, introducing trade and competition to otherwise oppressive and closed societies, opening up their borders to commerce and enterprise. Markets were created and expanded, bolstering national economies, enabling them to interact with each other and create opportunity like the world had never before seen. Innovation flourished and society advanced exponentially.
source: http://tutor2u.net/blog/index.php/economics
Two hundred years down the line and the terrain is not the same. The ideas and approaches that once worked so beautifully don’t apply anymore. The situation has changed and so have its necessities. Extreme deregulation has almost led to chaos and breakdown. Increasing costs and growing demand have created an obsession with bottom lines, letting profit destroy social responsibility and accountability. Disorganization has subjected the ecology to a global tragedy of the commons, each enterprise out for itself and mindful of only how to survive, in the process plundering and abusing common resources i.e. the planet.
Market fundamentalists are unimpressed by this turn of events and dismiss all such claims as exaggerated scaremongering. They in fact see no fault in their ways and no limitation to their creed. They believe in a system of magical corrections, conveniently provided by an invisible hand in the sky. Everything will fall together and adjust in ways that are fair and just, if only we allow it, goes the mantra. If only we trust and believe in it enough to let it do what it does.
The argument is dubious. Organized religion has been preaching this for years, convincing people to have blind faith in the workings of a world governed by an invisible being’s will, trusting everything will be ok as long as they obey the Word. Trusting in it to watch over us.
Plenty of individuals have seen through the argument and, dubious as it is, are not buying it, voicing their criticism loud and clear. Market fundamentalism, extreme as it is becoming – and having less and less to do with free market economy – is an ideology getting out of hand, which many feel ought to be marginalized. Opposition to it is growing and alternative suggestions are being made.
The main suggestion is that we change course and steer clear of this rampant mode of business, engaging in something more unitary and cohesive, for lack of a better word – something in line with the needs of the globe, the individuals who constitute it, and the nature that sustains everything on it.
It’s a reasonable claim. But prone as it is to abuse, like any idea put forth by human beings, it has been hijacked by extremists. State interventionism has stepped up to the cause, overtaking the argument and taking the lead in the fight against market fundamentalism.
source: http://rothroad.blogspot.com
What is (economic) state interventionism? It is a radical approach aimed at controlling deregulated, free markets gone berserk – and has nothing to do with the state intervening to avert disaster when absolutely necessary. This is an ideology that believe in the systematic steering of fiscal policy by special administrative bodies. Its advocates deem free markets an unstable force as they stand, which, unable to regulate themselves over time, require heavy regulation in turn. Specific measures need to be taken to commandeer society on track, they claim. Committees are to be selected to intervene on them where necessary in order to steer the economy in the proper direction. Decisions are to be made according to the judgment of expert panels, set up for that purpose alone. Enterprise is to be thus driven and molded by specialists of supreme knowledge. So say the interventionists.
The arguments are dubious and counter-fundamentalist. Sounds like forces high above are being summoned to do the work for us again. Expert hands to come to the rescue of every man, woman and child whenever the going gets tough, ready to set things straight and make everything alright again – maybe even prevent trouble in the first place by preempting the markets with austere top-down policy. Only this time they are not ethereal, these gods, but made of flesh and blood.
Here is where the alarm bells go off. When people are promoted to godly status in order to preserve order from parapets of supreme and non-transparent power, it sounds terribly dubious in fact, almost communist and despotic. It grants man the power to steer things which have been found to respond very poorly to commandeering. Not to mention how dogmatic it all is, sanctioning power from above in the way oppressive regimes and religions do.
So here we are, stuck between an invisible hand and an invisible hand. One is made of flesh, the other of quintessence. Who to choose if we had to? Hard to say. The expert hand of the interventionist committees has the advantage of being run by human beings and not an omnipotent sense of order that cannot be clearly defined. Then again granting human beings that much power is a liability in itself, as dangerous as any dogmatic creed. That is how theocracy came about in the first place, feeding on the body of faith, claiming divine right to rule in the name of something noble, something hijacked by man-in-power in the name of powerless man.
So where does that lead us? Invisible hand of market or hand of untouchable committee?
Fact is, no one is infallible, nor can they be trusted to be, no matter how well intended their acts are. But trusting in the intangible is not a logical option. At first glance, handing over control to experts in the field seems to be a far more reasonable thing to do than believing in magical invisible hands and idealized market corrections. Time to claim back our destinies from the airy-fairy and carry ourselves forth.
The issue then becomes about how to monitor the monitors. How to make sure those we appoint rulers to our economy and destiny will do a good job.
The answer is transparency in the system. These appointed supreme leaders have to be open to scrutiny and held accountable for all actions taken. It is our greatest guarantee against error and abuse on their part, granting citizens a peek inside their committees’ workings, making them accountable to all individuals. Should they falter or stray, they must be removed, replaced, and punished if need be.
Easier said than done. Total transparency and complete accountability are hard to attain on the practical level. All committees appointed in effect report to further administrative bodies and answer to them, in theory anyway. But what if they get too powerful, these committees? What if they push laws into effect over time to guarantee their immunity in the name of ‘necessary impartialness in the face of emergency’ – or some other authoritative excuse? What if the total transparency and accountability we so trust in are actually part of the inspirational but not totally accurate myth we have been weaving so eloquently about our system’s openness, the story we have constructed in order to give people hope and make them trust in the future? Is our society truly as open as we think it is?
Common sense says no. We are more bound to blind spots and dead ends than we would care to admit. There are pitfalls along the way, many of which are found when people behind noble causes claim supreme control in the name of restoring order. That is how communism started, on the noble but misguided idea that some people could rule over others with divine power in the name of greater good. The problem was not the setup, or Russian culture, or Chinese mass mentality, or Burmese, Libyan and North Korean state of mind. The problem is in the ideology of supreme central power itself. It is a faulty and dangerous concept that should be kept at bay at all costs. Any society deeming itself immune to it, thinking it can succeed in managing total power for whatever reason, is going to suffer for it. The real success is not being tempted to engage in that kind of governance to begin with.
So why create a blind spot where there isn’t one and risk another dead end? Why relinquish so much power to omnipotent economic committees, giving them the opportunity to become supreme gods among mortals? Absolute interventionism was the reason the world was in a state of atrophy for most of its history. Monarchy, theocracy, oppression from committees answering to no one. Must we go back to that state of affairs again? We needn’t exchange an invisible hand for an unaccountable one.
Let us be reasonable instead. Regulate the market as much as we need to in order to close the loopholes and get it back on track again. Watch over it from the side, not from above, not from positions of dubious power, just watch and guide and play alongside it, learning how to use it and be part of it. Mending its shortcomings when necessary rather than steering it from the onset in the direction we think it ought to go. Keep the colossal failure of over-centralized power in mind and drop our grandiose plans of commandeering the economy.
To do so we need to educate people and create responsible citizens. Only a savvy population will respond well to a crisis and create a market able to respond to the needs of the times in the long run.
As far as the top-down approach is concerned, government and watchdogs may need to flex some muscle from time to time, strong-arming corporations into more social responsibility strategies to avoid disasters such as the Deepwater Horizon Oil Spill and the Fukushima Nuclear Fallout.
Combining the two approaches – a free market society run by educated individuals, plus top-down legislation or incentives to promote social responsibility when none is offered of its own accord – these two approaches have the capacity to bolster national economies across the board, helping the global economy recover. The point is to help it grow in healthy patterns, consolidating itself in a way that will serve the things it was supposed to serve in the first place: the globe and its citizens. Anything else, from market fundamentalism to state interventionism, is just political expedience in the wake of disaster, another theocracy in the making. We have no use for that. We need a system that works on reason, not reason to work another system. The time has come to own up to the economy and let it help us make a better life for ourselves. For our children and future.
“Every individual… neither intends to promote the public interest, nor knows how much he is promoting it… he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.” – The Theory Of Moral Sentiments, Part IV, Chapter I, pp.184-5, para. 10. (Note – how the invisible hand was originally envisioned)
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