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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

Saunders on capitalism and happiness « Previous | |Next »
February 17, 2008

Peter Saunders in the CIS latest issue of their Policy magazine continues his debate with Clive Hamilton on capitalism and happiness. He says in his Why capitalism is good for the soul that Hamilton's argument that capitalism is bad for the soul, which is:

aimed mainly at a disaffected intellectual middle class, is that we have become preoccupied with the pursuit of wealth and are increasingly unhappy and unfulfilled as a result of our materialistic lifestyles. Clive believes we have broken our ‘magical relationship with the natural environment,’ and that the pursuit of money is getting in the way of our ability to reconnect with our ‘true selves.’

Saunders reckons otherwise-- capitalism is good for the soul, by which he means that it enhances our capacity to live a good life.

He notes the disaffected intellectuals have consistently attacked capitalism in modernity for its failure to meet human needs. Since that claim is unfounded, according to Saunders, we need to ask what is it about capitalism that so upsets the intellectuals.

Saunders answers thus:

But the best explanation for the intellectuals’ distaste for capitalism was offered by Friedrich Hayek in The Fatal Conceit... Hayek understood that capitalism offends intellectual pride, while socialism flatters it. Humans like to believe they can design better systems than those that tradition or evolution have bequeathed. We distrust evolved systems, like markets, which seem to work without intelligent direction according to laws and dynamics that no one fully understands.

Nobody planned the global capitalist system, nobody runs it, and nobody really comprehends it. This particularly offends intellectuals, for capitalism renders them redundant. It gets on perfectly well without them. It does not need them to make it run, to coordinate it, or to redesign it. The intellectual critics of capitalism believe they know what is good for us, but millions of people interacting in the marketplace keep rebuffing them. This, ultimately, is why they believe capitalism is ‘bad for the soul’: it fulfils human needs without first seeking their moral approval.
Saunders conceit, along with Hayek's is that capitalism is natural--- it is a system that tradition or evolution have bequeathed; an evolved system, which seem to work without intelligent direction according to laws and dynamics that no one fully understands.

Really? Neo-liberal governments seem to me to spend a lot of time, energy and money creating markets--in education, energy, water, aviation etc. Capitalism bears the mark of human design.

| Posted by Gary Sauer-Thompson at 6:03 PM | | Comments (8)


Let me settle the argument for them. Capitalism isn't the problem. The Corporatisation of capital is.

Both Hamilton and Saunders, in my view, tend to formulate their arguments from such a strong and well-defined ideological viewpoint that it often seems to contaminate their logic. I think Hamilton is over the top when he effectively says that capitalism is making everyone sad. I think Saunders is over the top when he effectively says that capitalism makes left-wing intellectuals sad and there is actually nothing to be concerned about.

Where is the rational, considered, middle ground?

your rational considered middle ground can be discerned in this paragraph by Saunders, just after he concedes that Hamilton's arguments about contemporary capitalism do have some substance:

Moreover, just because a luxury barbecue won’t satisfy the soul doesn’t mean we would be better off without it. Clive assumes consumption prevents the pursuit of genuine happiness, but commercial relationships do not rule out other, more enduring, forms of association, like friendships, family ties, voluntary activity, or religious worship....Of course buying and selling cannot give us everything we need in life, but most people are well aware of this. Hamilton claims that 75% of us think spending time with friends and family will enhance our lives, while fewer than 40% think more money will do the same. It is difficult to see how capitalism can have turned us into consuming automatons when so many of us still assert the importance of non-materialistic values.

The traditional argument by both conservatives and leftists with respect to liberalism has been that the commercial relationships of the deregulated market undermine, corrode, and eventually destroy the non-commercial relationships of the family, civil society and community.

Therefore, capitalism is not just good for the soul in that it does not just enhance our capacity to live a good life. It also stunts our capacity to live a good life.

not to mention the incapacity of the deregulated market to deal with what economists call externalities---eg., global warming. That unintended consequence of corporate capitalism requires the state to intervene and regulate the market so that we can lead better lives.

I agree with your last two points about the myth of the unregulated market that underlies Saunders's neoliberalism.
Take Workchoices: this set of regulations was meant to free up the labour market. In Saunders's terms to remove the interfering hand of government from what is naturally efficient and functional. And yet the legislation was fleshed out in regulations of phonebook thickness. This wasn't deregulation, but regulation designed to drive down wages and conditions in the service industries and in casualised wage-earning jobs.

Saunders's free-market is a highly regulated machine, and the biggest boosters of free-marketeering are often the ones who are first to go running to state instruments, like the US Fed, when the risks become too big.

how true. Saunders was in the AFR today arguing for the neo-liberal position of more flexible labour markets. He said that the minimum wage needed to be cut to help the low skilled gain jobs, as a lower minimum wage would enable employers to hire marginal workers.

How is this shift to a more flexible labour market to be achieved? By the state redesigning the economy machine.

The privatising of parts of the state---the police and military--is another example. A good examaple is the privately run prisons.

Didnt Marcuse sum up the zeitgeist of capitalism perfectly in the title of his book One Dimensional Man.

Such being the ideology that drives both the CIS & the IPA---thought the CIS is a little bit more sophisticated in their reductionist sophistry.