Let the economy die?! Rushkoff’s goals are noble but his plan needs work
A couple of weeks ago author and NYU media theory lecturer Douglas Rushkoff penned a provocative essay for Arthur Magazine. Entitled “Let It Die,” the essay explains why we should stop trying to save the economy.
In a perfect world, the stock market would decline another 70 or 80 percent along with the shuttering of about that fraction of our nation’s banks. Yes, unemployment would rise as hundreds of thousands of formerly well-paid brokers and bankers lost their jobs; but at least they would no longer be extracting wealth at our expense. They would need to be fed, but that would be a lot cheaper than keeping them in the luxurious conditions they’re enjoying now. Even Bernie Madoff costs us less in jail than he does on Park Avenue.
Alas, I’m not being sarcastic. If you had spent the last decade, as I have, reviewing the way a centralized economic plan ravaged the real world over the past 500 years, you would appreciate the current financial meltdown for what it is: a comeuppance. This is the sound of the other shoe dropping; it’s what happens when the chickens come home to roost; it’s justice, equilibrium reasserting itself, and ultimately a good thing. [emphasis in the original]
Lest you reflexively dismiss Rushkoff as a crackpot, let’s be clear on something – he’s a very smart and thoughtful man. Whether you ultimately choose to buy his argument or not – and I’m guessing the “nots” will carry this one handily – he’s making some important points about the house of cards we now find collapsing around us, points that we’d do well to understand as we set about picking up the pieces and rebuilding.
I want to make an observation about the article and conclude with a couple of responses.
The Army of Ludd
First the observation: Rushkoff’s position aligns him with the neo-Luddite movement, and he is not alone in advocating it.
I don’t mean “Luddite” in its commonly (mis)understood, pejorative sense – there are few words in the English language that are more frequently misrepresented. A brief history lesson illustrates the point. The original Luddites revolted against technological advances in the British textile industry from 1811 to 1816. While the term “Luddite” popularly connotes someone who is anti-technology, the actual rebellion was more critically aimed at technology which threatened the sanctity of culture (Rybczynski, Pynchon). Their reaction was not against progress per se – they themselves gladly used the newest weaving technology available, and were “interested in innovation and technical improvements to make their work easier” – but were instead opposed to the dehumanizing dislocations of the industrial economy.
At the turn of the 19th Century, factory looms were the latest innovation, and a factory job meant arriving at dawn for a 15 to 18 hour working day, and the door was locked behind you in the morning and not opened until the end of the shift. To the Luddites, the factory looms spelled the end of a way of life, of craftsmanship, of community and of family (Murphy).
From the perspective of modern-day Luddites, the “original rebels against the future” reacted against technological encroachments on the natural order of human society.
The Luddites had no objection to many technologies such as the carding engine and the spinning jack that supplemented human labour, but were not a threat to their livelihoods. By contrast, the inhuman machines that characterised the Industrial Revolution were new and different in that they were independent of nature, of geography, and season and weather, of sun, of wind, or water, or human or animal power. They not only destroyed jobs, but marked the beginning of an environmental catastrophe (Ludd).
As I was reading Rushkoff’s polemic I couldn’t help thinking about one of today’s leading neo-Luddite voices, Kirkpatrick Sale. I first encountered Sale when working on my dissertation, and his take on the Internet was scalding. For instance, in response to the popular claim that the Net would foster a stronger democracy, finally enabling a truer Jeffersonianism than was ever possible before, Sale replied that, “You can’t democratize – you can’t control – a technology that was established for other reasons.” Created for control and consumption, “This technology does not come with democracy in it” (Robin).
As it turns out, Sale has some thoughts on our current economic situation, as well. Last November, in delivering the keynote before the Manchester Convention, he invoked Thurber (“If you live as humans do, it will be the end of you”) and characterized the 2008 election as a boxing “match fought between two big palookas.”
What can you say about a system that spends nearly a billion dollars and takes two years every four years to produce two palookas to run for high office? What can you say about a system that allows that money effectively to let corporate America buy politicians of so-called “both” parties to serve at its bidding for the next term of office?
What can you say about a system that openly, blatantly proves that its politicians are craven lackeys of the financial plutocracy by having an administration that could invent and a Congress that could pass a measure that robs the public treasury of a trillion dollars, for the benefit of financiers and bankers who created the mess this money is supposed to fix ? And what can you say when that open, blatant admission of corruption, vice, graft, and evil is met by no roar of outrage, no righteous uprising, but passive acceptance by the great majority of the so-called citizenry, who go on to elect a man who thoroughly supported it?
The United States has never shown itself to be more unmanageable and incompetent, more venal and degraded, more undemocratic and ungovernable, than in the last three months.
I don’t want to put words in Rushkoff’s mouth, but I’m not hearing much here that I think he’d quibble with, especially in light of Sale’s comments just last month in Counterpunch.
We’ve got two choices. One is the Lincolnesque way that Obama seems to promise: government subsidies for the larger corporations and banks (as Lincoln pushed in his day, especially for the railroads), refurbishing of the infrastructure (ditto), nationalization of the financial system and reckless printing of currency, increased centralization of the government and its hold on the economy, continuation and expansion of warfare and the war machine (all ditto). That is a continuation of the past, and it is amazing that the nation largely does not recognize it as a recipe for continued collapse. It is in fact not sustainable, nor is the environment in which it is floundering.
The other way is to rejigger, to dismantle, the entire system.
If this all seems a bit radical to you, let’s at least acknowledge the good faith of the authors, who clearly yearn for a better, more sustainable and just way of life for us all. Let’s also acknowledge that it gets harder by the minute to refute Rushkoff’s assessment of our system: “We do not live in an economy, we live in a Ponzi scheme.”
So what went wrong? Nothing. The system worked exactly as it was supposed to.
Bernie Madoff and AIG may be the faces of the crisis as reported by the corporate media, but surely we’re all smart enough to understand that we didn’t get where we are because of them. Surely we’re intelligent enough to distinguish between the disease and a couple of symptoms.
The solution? Well, in Rushkoff’s view (shared by Sale and a great many other extremely intelligent commenters out there), Obama is making it worse, not better.
President Obama may be smarter than most of us, but he’s still attempting to rescue the very institutions that robbed us in the first place. He’s not a socialist, as conservatives may be arguing, but he is a corporatist. Using future tax dollars to fund government job programs is one thing. Using future tax dollars to give banks more money to lend out at interest is robbing from the poor to pay the rich to rob from the poor. [emphasis in the original]
So, he says, “let it die.”
The Natural Trajectory of Complex Systems
In 1995, Wired‘s Kevin Kelly conducted an interview with Sale, and if ever there’s been a one-on-one between two people with more divergent views of the world, I’ve never seen it. At one point, Kelly asks Sale “why are we here? What are humans here for?” The exchange tells us a lot about Sale, and also, I would suggest, about Douglas Rushkoff.
Sale: [Pauses.] To exist.
Kelly: So, what would be a measure of a successful human culture?
Sale: That it’s able to exist in harmony with the rest of nature.
Rushkoff’s closing comments don’t herd us all back into caves, but they do, very explicitly, advocate what we might call a “simpler way of life.” I suspect a lot of us find a certain allure in this, especially now, when the dire complexities of our economic meltdown weigh heavily on us.
History, though, teaches that there’s an inexorable tendency toward more complexity in societies, and if we study what has gone before we can see a pattern: growth, increasing complexity, [something goes wrong], call for return to simpler way of life. Lather, rinse, repeat. Complexity theorists believe that Newton’s second law is countered, in some contexts (biological sciences, economics, social structures, etc.) by an as-yet-unstated law explaining the drive toward ever-higher orders of organization (Waldrop). Obviously economies are one area where we have seen an unrelenting pressure toward greater complexity, and it seems an elementary enough observation that as complexity increases, our ability to fully perceive the system in question and predict its consequences diminishes. If we add the principle of “sensitive dependence on initial conditions” – aka the “Butterfly Effect” – to the equation (which we certainly should) our inability to comprehend, predict and control very quickly becomes functionally infinite.
The problem, as I see it, isn’t the complexity of the economic system per se (although I agree that we have to be careful about what are essentially autonomous systems). Instead, it’s the political economy serving them. Put another way, what we need isn’t necessarily a simpler way of life, it’s a more pro-human set of guiding principles for the “complex adaptive system.”
I say this because idealizing some moment in a simpler past is always easy, but a close examination of that moment in context almost never reveals it to be the utopia it’s imagined to be. If we look at Rushkoff’s pre-corporate banking moment we’ll find that we knew a lot less back then about things like medicine, for instance. On the health front – infant mortality, life expectancy, succepitibility to communicable disease, and overall quality of life – we’re a lot better off than we were. This matters because economic systems don’t exist in a vacuum – without the massively complex growth in our economy, it’s likely that many other elements of our society would be closer to 1509 than 2009, as well. The small, localized economies that Rushkoff wants to return to weren’t capable of generating the massive resource pools necessary to tackle many of the large challenges we’ve overcome in the last 500 years.
We know that complex adaptive systems operate according to fundamental bottom-up rules. That is, they are not governed (at least not effectively) by lots of tinkering and commanding from on high. Instead, there are a very few fairly simple foundational principles, and in the case of our current system one of those rules driving the behavior of capital appears to be something along the lines of “seek out and remain in close proximity to other capital.” Or maybe this rule isn’t even needed, since chaos theory has taught us enough about “attractors” to know that things accumulate – especially things like money and power.
In any case, what I think Rushkoff wants is a system where the basic rules keep wealth from accumulating in too few hands, instead seeking broader and more level distribution patterns.
If you’re thinking that somewhere in the past few paragraphs this discussion got really academic, you’re probably right, because regardless of whether Rushkoff is right in what he thinks he wants or I’m right in correcting his aim, no plan currently on the table in Washington is going to arrive us in either place. And while I do regard Mr. Obama as someone acting in good faith (by politician standards), and there’s no question that he was the best of the viable options on the ballot in November, he’s certainly the corporatist that Rushkoff accuses him of being. This shouldn’t need illustration, but if it does, ask yourself whether Obama appears committed to saving and “fixing” the existing system or, as Rushkoff advises, letting it die and replacing it with something else entirely.
And now, an honest discussion of the costs
Rushkoff understands that getting from Point A – where we are now – to Point B – his ideal economy – will be hard. He acknowledges that it will be painful.
As painful as it might be to watch, and as irritating as it might be to those with shrinking retirement savings, the collapse of the centralized corporate economy is ultimately a good thing. It makes room for a real economy to rise up in its place. And while it may be temporarily uncomfortable for the rich, and even temporarily devastating for the poor, it may be the fastest and least violent way to dismantle a system set in place for the benefit of 14th Century monarchs who have long since left this earth.
There are a number of moving parts in that graf, so let’s take them one at a time. And in doing so, let’s afford him the benefit of the doubt.
…the collapse of the centralized corporate economy is ultimately a good thing. It makes room for a real economy to rise up in its place.
Perhaps. More on this in a minute.
And while it may be temporarily uncomfortable for the rich…
“Temporarily” is a prediction that we simply have no foundations for. I’ve been reading Nassim Nicholas Taleb’s The Black Swan of late, and I recommend it highly for those engaged in predicting anything about anything.
…and even temporarily devastating for the poor…
What I just said about “temporary.” Also, we’ll talk in a second about that word “devastating,” because I’d like us to walk away from this discussion clear-eyed about exactly what it means.
…it may be the fastest and least violent way to dismantle a system set in place for the benefit of 14th Century monarchs who have long since left this earth.
Yes, it “may” be. Or it may be the surest path to the most violent civil war the planet has ever witnessed.
Like a lot of people, I oscillate back and forth between my idealist and pragmatist poles. There are moments when I can be dreamier than a doe-eyed schoolgirl and other times when my cynical side would give the shivers to Machiavelli himself. As I read Rushkoff’s modest little proposal I found myself torn. The part of me that lives in Magic Wand Land recognizes the fundamental corruption that Rushkoff describes and believes passionately that we’d be better off living in an economic system that served us all. Truth be told, “Ponzi scheme” is a mild descriptor for our current hegemony, and there are lots of people who deserve worse punishment than they’re likely to get (for that matter, worse than is allowed by the 8th Amendment).
My pragamatic side can’t get past the path from Point A to Point B, though. The only term in Rushkoff’s whole essay milder than “Ponzi scheme” is “devastating.” If we “let it die,” yes, it will be hard times for “hundreds of thousands of formerly well-paid brokers and bankers.” It will also be tough on a lot of other people. For instance:
- Millions will lose their homes. And not just the millions in trouble right now. All of them and millions more.
- When the stock market declines another 70-80%, we’ll go from a nation where pensions are at risk to one where nearly no one has any retirement cushion at all. Any money that isn’t hidden under a mattress will be gone.
- Forget universal health care – good luck finding health care period. Yes, all those doctors will still exist but their practices and hospital facilities will be history. Maybe a few will be able to get out the door with something more than their little black bags, and if you know one you may be able to barter for care should you or someone in your family fall ill. If not, pray that the doc in question is a saint and isn’t worried about having to feed a family.
- And about feeding a family – if you’re not a farmer, you’re in trouble, because the whole infrastructure is going to collapse. No more supermarket – you’ll either be a farmer or a hunter-gatherer.
- Got a gun? Because you’re going to need one. When your choice is steal or die, steal is going to win a lot of times.
- It’s hard to say whether what emerges at this point is really war, because the sides may be a little fuzzy. Organized civil war is one possibility, but heavily armed neighborhood gang warfare is another.
In other words, people are going to die. Lots of people. Children are going to starve to death in the streets. Maybe your children, but if not, almost certainly the children of someone you know. And since America is so central to the global economy, let’s try not to imagine what happens in areas that are already impoverished.
If we’re lucky enough, at some point, to emerge from this holocaust, it’s pure fantasy to assert that a “real economy” is what results. It’s at least as plausible to suggest that instead we’ll wind up with a system that makes the Bush/Cheney years look like Mother Teresa at Disneyland by comparison.
Think I’m painting a dark picture here? Fine – feel free to explain how Rushkoff’s prediction is more plausible, given what you know about wealth, power and basic human nature.
The Problem with the Future
If I’m landing on Rushkoff a bit hard, I hope it’s at least clear just how much I agree with him concerning both the problems we all face and our desire for a more sustainable, equitable economy. I also applaud him for having the courage to step up and say these things in a public forum, because let’s be honest, not everybody out there is going to be willing to hear the core message. I wonder how many readers never made it past the first sentence.
However, I don’t have a magic wand and neither does he. Perhaps he believes that the price we’d have to pay to “let it die” is worth it. Maybe he’d look hard at the possibility of hundreds of millions dying – and maybe more – and still say that in the long run that would beat the alternative. There are those who argue that our planet is horrifically overpopulated and that the best thing for both it and us (“us” being the species) would be if all but a few million people were to die.
In the long term, in the macro, perhaps these things are true. But if so, and if that is in fact the argument, then let’s acknowledge the full weight of the word “devastating,” which describes the epic brutality of what would happen in terms so tame it barely qualifies as a euphemism.
Further, let’s demonstrate a little more humility about our ability to predict the future. I’ve always been pretty utilitarian, but have had to accept that doing that which will result in the greatest good is a fine goal, but it’s so afflicted with uncertainty and unknown, uncontrollable variables that it’s an impossible course, literally.
I’m sorry that I can’t offer up a solution here, because I know that would be comforting for some (and would give others an even larger target to shoot at). All I can really do is suggest that as we address our economic system, we do so with those foundational principles I mentioned earlier in mind: does a particular action serve the interests of the hyper-wealthy or does it structure the investment so that it seeks broader distribution and geater equity?
That may be all we can do.
UPDATE: Since I posted this piece I’ve been contacted by someone at Arthur Mag named Jay. A quick glance at their masthead suggests that this is probably the editor, Jay Babcock, who is writing to accuse me of shamefully misrepresenting Rushkoff’s positions. (And “shameful” is his word, not mine.) There is a follow-on to the original essay, in which Rushkoff seeks to clarify his positions, I assume because the response he’s received has convinced him that people are missing the point. I recommend this piece as well as the original.
Now, to Babcock’s charge: First, I can only respond to what Rushkoff writes. If his position is somehow different from what’s in the essay, it’s hardly my fault for “missing” it.
However, I don’t think this is what’s happening. I think Rushkoff makes his case clearly and coherently and I can’t see where I have misrepresented it at all. If I have, I quote liberally and link to the original, and am glad to amend if I’ve inaccurately portrayed the intent of the essay.
Second, I think Babcock is the one who misunderstands what’s going on, and in Rushkoff’s second article I think I see the source of the confusion. There are a couple spots that illustrate. First:
For reasons I cannot understand, people seem to think that my explaining this phenomenon somehow means I want us to go back to a hunter-gatherer stage. Or that I long nostalgically for a return to a late-middle-ages lifestyle. Or that I am somehow renouncing my earlier enthusiasm for new technology and media.
Nothing of the kind.
When I say it’s okay if the Dow Jones goes down another 70 percent, I’m not calling for an apocalypse. I’m calling for the re-balancing of the speculative economy.
In both cases Rushkoff is correct. Nothing he wrote in either place suggests that he wants to return to the wilderness, nor is he hoping for an apocalypse. Instead, he has a vision of a re-balanced economy based on genuine commerce instead of a rigged game of speculation.
My reaction above makes clear that I think what he’s suggesting would cause the bad things I describe to happen, however. Not that it was Rushkoff’s intent, but rather that it could/would be an unintended result. I didn’t spend all that time talking about uncertainty, our inability to predict and the Butterfly Effect for no reason. My point is that as much as I share his sense for what our economy ought to be, and as much as I sympathize with his assessment of our current rescue policies, I do not believe that his proposed course of action – allowing the market to die, an epic crash where it loses up to 80% of its value, etc. – will get us from Point A to Point B. Or that if it does, it will do so at anything like a tolerable cost.
This, Mr. Babcock, isn’t misrepresentation. It’s a basic disagreement over implications. If you’re going to write people to harangue them about intellectual dishonesty, you’d do well to know the difference.
I have asked Babcock to show me examples of where I have misstated Rushkoff, and as of this update said examples have not arrived. If a credible response eventually does turn up in my mailbox I’ll note it and offer a reply here. ____________
UPDATE 2: It’s Sunday and the ed. at Arthur mag, as anticipated, still hasn’t stepped up to back his charge that I was misrepresenting Rushkoff’s positions. He did, however, make time to delete my comment on the post and a follow-up comment I made a few minutes ago, so his lack of response to my request isn’t because he’s taking the weekend off.
I think I may write Rushkoff directly and invite him to respond here if he so chooses. I may even go so far as to invite him to post at S&R if he likes. He hardly needs us, but we could provide him a with a marginally larger audience and an editor who knows the difference between legitimate disagreement over outcomes and intellectual dishonesty.
- Ludd, Eliza & Ned. “New Luddite: Challenging the Legitimacy of Science and Technology.” November 1995. World Wide Web. February 4 1999.
- Kelly, Kevin. “Interview With the Luddite.” Wired June 1995.
- Murphy, Gary Lawrence. “Are We the Neo-Luddites?” February 1998. World Wide Web. February 4 1999.
- Pynchon, Thomas. “Is It O.K. to Be a Luddite?” New York Times Book Review October 28 1984: 1, 40-41.
- Robin, Michael. “Technology for the Coming Millennium: Progress, Technology and Society According to Kirpatrick Sale.” MicroTimes March 4 1996: 138-144, 282-284.
- Rybczynski, W. Taming the Tiger: The Struggle to Control Technology. New York: Penguin Books, 1983.
- Sale, Kirkpatrick. “Lessons From the Luddites: Setting Limits on Technology.” The Nation June 5 1995: 785+.
- Waldrop, M. Mitchell. Complexity: The Emerging Science at the Edge of Order and Chaos. Simon & Schuster, 1992.