Elitist Confusion
One of my ongoing sources of frustration is the amount of effort elitist folk put into lecturing the rest of us about why we ordinary people are wrong. When you spend the time to unpack the lecture, and the source of our error, you most often end up with something that is a sad mix of resentment, fear, and outright self-justification. Our elite has, after all, to explain why we ought look up to it as elite.
There is thus some confusion. And, more often or not in the realm of economics and politics, that confusion has its roots in the conflict between capitalism and democracy.
This week’s Economist magazine has just such a lecture in its regular Buttonwood column. This one is entitled “Polls Apart”.
It begins, as many elitist arguments do these days, with a brief mention of the negotiations over Greek debt. Those negotiations have, according to the Economist, ‘provoked claims that democracy is being ignored’. Well, yes they have — by me amongst others. As a general rule I think the democratic urge ought to take precedence over the capitalist. Call me crazy, but that’s just who I am.
Now comes the elitist riposte: in the next paragraph, and no doubt in severe tones were we able to listen to the authors voice, we are told that the truth is more simple. There are limits to democracy. And those limits are set by the natural workings of the economy. The exact phrasing is this:
“In fact, there have always been limits on voters’ freedom to pursue their desired economic policies”.
As it happens I agree with this statement. Yes, it is true that voters’ desires get hampered. Yes, it is true that there are limitations on the economic policies voters can pursue.
But here’s the difference: whereas the Economist claims, in its paternalistic elitist voice, that those limits spring somehow from the nature of the economy, I would make a different claim. I would argue that those limits are set by the impositions of the elite itself as it self-satisfies its wants ahead of the rest of us. These are not ‘natural’ limits at all. They are an artifact of class self-interest.
The rest of the Economist article goes on to give a very succinct account of the impact the rise of democracy had in the twentieth century. All sorts of bad things happened: as the franchise was extended that democratic urge to share in the goodies generated by our collective activity forced the elite to set up health care and pension schemes. It also forced a drive for better education — although the elite benefited, via higher profits, from the education of the workforce. Then the crisis in capitalism in the 1930’s generated a call for Keynesian style demand management, which was the ultimate perversion of the economy since we all know that only the supply side matters to the elite.
After the retreat of Keynesian policy making in the late 1970’s — caused by its inability to account for stagflation — governments gave up on democratic economic policy making and allowed unelected central bankers to take over. And they delivered what is nowadays called the “great moderation” which is that period of steady growth and low inflation dating roughly from the early 1980’s through to 2007, when it blew up because of the banking industry’s rush of greed.
Notice how the story shifts.
The democratic impulse that brought health care, pension, and education spending is swept under the rug. The Keynesian era is dismissed as an error. And the last three decades of undemocratic economic policy making are left standing as if they hadn’t landed us all squarely on the rocks of the crisis just past.
In other words the rule of the elite, and those natural forces that magically seem to reinforce the wealth of the elite, are unquestioned. But the attempt of the rest of us to look after ourselves is swept to one side as a foolish interference with, well, nature.
Forgive me if I laugh.
I long ago gave up believing in notions of ‘natural’ forces. The economy is, after all, just an amalgamation of people going about their respective business. It is a giant collective governed by human-made institutions, norms, cultures, relationships, and so on. It is very far from being ‘natural’. So meddling with it to ensure a more democratic spread of the benefits that the collective generates is hardly an interference with nature. It is simply a rewriting of all that human-made stuff. We are entitled to do that.
And if, along the way, the elite gets pushed aside or even bullied a little, so be it. My reasoning is simple: if we are going to rig that human-made stuff, we might as well rig it to maximize the number of people benefitting. We ought to prefer democracy to capitalism.
