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Saturday, January 05, 2019

New values, new aristocracies

This week I read another remarkable book, Winners Take All, by Anand Giridharadas.  Giridharadas, born in 1981, attended Sidwell Friends School in Washington--the alma mater of Chelsea Clinton and Sasha and Melia Obama--the University of Michigan, and Oxford. He was at one time a doctoral candidate at Harvard but appears to have abandoned that career path.  He did a stint at the consulting giant McKinsey and Co. in the mid-2000s, and then moved into journalism with the New York Times.  He became a fellow at the Aspen Institute.  He was in short a very successful young member of our diverse new intellectual aristocracy.  Suddenly, however, he had an epiphany about his role in the world and the system of which he had become a part, and this book is the result.

Winners Take All is an impressionistic but powerful survey of the role and attitudes of another part our new elite, the extraordinarily wealthy titans of IT and finance, our fastest growing sectors, as well as some heirs in other powerful industries such as pharmaceuticals and energy, and the leaders of some of our most prominent foundations.  Giridharadas lumps them all together under the heading of "Market World," which appears to be his own coinage. These people congregate periodically at the Aspen Institute, meetings of the now-defunct Clinton Global Initiative, and in many other organized conferences, and share their thoughts and plans for changing the world.  A remarkable consensus on basic issues prevails among them.   First of all, they regard the private sector--especially the parts of it that they represent--as dynamic and creative, while the public sector, in their eyes, is static, bureaucratic, and hidebound.  They believe, crucially, that only the dynamic private sector can solve the world's problems, primarily by maximizing efficiencies, opening up opportunities, and creating wealth.  They have a real 19th century faith that their own success confirms that they are at the cutting edge of history and profess superior skills and, I think, superior moral worth as well.  And while some of them feel some guilt about having so much while others have so little, that never seems to be enough to lead them to question their basic assumptions about the world and where it is going.

Giridharadas spends some critical pages in the book drawing on his experiences at McKinsey to explain the mindset that these people have learned in the corporate world.  McKinsey consultants, he makes clear, do not help companies by studying what those companies do in any detail.  Instead, they have their own algorithms for looking for ways to raise revenues or cut costs--and the latter often include proposals to eliminate whole portions of the enterprise that are not pulling their weight, profitwise.  The consultants' status--and their income--comes from the perception that their protocols embody the secret of corporate life, whatever the specific characteristics or the particular role of the company that has enlisted them.  One thing Giridharadas came to realize was that applying these protocols keeps the major trends of the world economy going: a growth in productivity, whose benefits flow exclusively to the owners of capital, not to the world's working classes, whether on the factory floor or in the office.

The protagonists of his book seem to understand this to a certain extent, and they want to do something about it.  That brings them together in these various venues to discuss what might be done and to contribute some money to do it.  But that money, naturally, never goes to challenges to the order that has made them (or their patrons) rich enough to worry about these things in the first place.  They tend to like causes that allow them to open up some opportunities for less well off people--such as providing better data processing networks to third world entrepreneurs--rather than anything that would keep them from earning, or keeping, so much money in the first place.  Resources remain under their control--rather than going into the coffers of a government that is elected by, and claims to act on behalf of, the whole people of the nation, as they did in the middle third of the twentieth century, when inequality reached historic lows and the lower orders of society actually shared in the proceeds of economic growth.  I found it interesting that like Thomas Piketty--whom he quotes approvingy--Giridharadas doesn't seem to understand how crucial the wars of the twentieth century were in creating such a society, both by mobilizing truly gigantic resources on behalf of a common effort, and by creating a real obligation from the government to the people who had fought the war.  Winners Take All is a very interesting complement to Crashed, which I reviewed last week.  They deal with different parts and different generations of our new global aristocracy, but they both illustrate the hegemony of free market values, and the embrace of their consequences, which completely dominates that elite, without any effective countervailing force in today's world.

It was when Giridharadas referred to potential countervailing beliefs, in fact, that I found his book weakest.  Again and again, when he refers to the evils of the modern world, he focuses on racism and sexism and implies that entrenched attitudes among a white male power structure are the biggest source of our problems.  That, probably, is the view he imbibed in the educational system, where it is utterly hegemonic.  That, however, is the problem.  First of all, in my opinion, that view is wrong.  The biggest problem we face isn't the role of race and gender in our society, it's the continually increasing concentration of wealth that is leaving the whole lower half of the population--and perhaps more--further and further behind, regardless of race, gender, or sexual orientation.  The power structure can in fact easily bow to concerns about race and gender by integrating some favored men and women into its top ranks--and there, as Giridharadas shows very clearly and intimately, those people adopt the same pro-market values as everyone else.  That is also, obviously, the strategy of our major educational institutions, which seem to be more beholden to the economic power structure than they have ever been, but salve their consciences by feeding a diverse group of favored young people into it.  One such young woman, a Georgetown graduate, is a major protagonist in Winners Take All, and she abandons dreams of becoming a rabbi to go first to McKinsey and then to the new Obama Foundation, where she will help administer the new form of pro-corporate philanthropy, of which more in a moment.  The major effect of left-wing activism over the last few decades, it seems to me, has been to diversify the elite, first in academia and journalism and foundations, and also--albeit to a lesser extent--in the corporate world.  That does not change the elite's relation to the rest of the world.   More importantly, it seemed to me, a veteran of a life in academia, that Giridharadas was missing an important point about intellectual trends there.  The academic obsession with race, gender and sexual orientation, in my opinion, is just as dangerous an enemy to originality, free thought, and understanding the biggest problems we face as the emphasis on market efficiency is in the corporate world.  Both provide astonishingly simple answers to every problem--and neither one, in my opinion, will allow us to get to the heart of the matter.  Intellectually, the Boom generation--which shaped both of these trends--is a generation of sheep.

It was national governments, to repeat, that emerged in the middle third of the twentieth century as the supreme economic authority, effectively regulated financial markets and other parts of the economy, and gathered and redistributed resources on a massive scale.  In an argument that left me shaken--and eager finally to read a classic that I have never opened--Giridharadas argues that Thomas Hobbes, in his famous work Leviathan, was arguing for a powerful state to protect the citizenry from the tyranny of lesser authorities--aristocrats in his time, corporations in ours.  Out statesmen (and women) now, however, rely on corporate wealth to pursue their political careers, and accept that reforms in our society can only go as far as corporations will allow.  In a long interview with Bill Clinton, Giridharadas hears about Clinton's efforts to keep soft drink manufacturers from getting their products into public schools, where they have helped trigger an epidemic of childhood obesity.   Clinton in the end made no attempt to pass laws to keep these products out of schools, but settled for promises from the manufacturers to reduce their products' sugar content.

A new Democratic majority took over this week in the House of Representatives, pushing a new round of liberal proposals.  We shall find if they have the power to challenge the economic orthodoxy that now rules the nation and the world--and whether they can appeal to all of us as citizens, rather than to certain particular demographics.  I am skeptical that those things will happen. Tooze and Giridharadas, I think, have allowed me to see the future.  They suggest that our new value system has already been pretty well established, that dissenters will remain an isolated minority, and that our great crisis--in the sense of a struggle over the values and direction of our society--may well come to an end as soon as the corporate elite has managed to put a reasonably competent and reassuring figure into the White House once again.  And that figure, as we have seen in the last 20 years, can just as easily be a Democrat as a Republican.


JRW said...

Interesting. I had recently posted the article from the NY Times about how McKinsey has helped raise the stature of Authoritarian Governments and you write about this author who had worked there. With Citizen's United, it seems difficult to campaign without big money. Look at almost any state that has ballot questions and see how many are defeated by Big Lies and tons of cash when those propositions threaten big corporation profits. Even the liberal politicians shy away. Polis here in Colorado was afraid to oppose the Fossil Fuel Companies on put some not very burdensome restrictions on fracking.
The Democratic Party Elite - those who have made money in the "entrepreneurial economy" and the financial manipulation economy that produces very little lasting benefits, were empowered by Clinton (Bill) who was lucky to take advantage of the first Internet boom (at least he balanced the budget once with this new found wealth), but surely didn't do anything to stop the increase in income inequality. But the Democratic Party almost has some of the 1880's robber baron philosophy in believing it is the fault of the poor and uneducated (unless they are a minority) for not getting ahead. Not everyone has the opportunity or the ability to be a highly educated professional, and with unions essentially non-functional these days, there is no power to have people work in trades and make a good living (and future retirement). Even if tariffs were raised so high that it wouldn't be profitable to make so many things in China, there isn't a trained workforce in the US to run the machines that produce the goods.
Keep putting out these thoughtful blogs. Hopefully they can get to a larger audience and maybe have some influence in public debate (is there any public debate anymore?).

Ed Boyle said...

I believed in market efficiency, free trade before the 2008 crash or perhaps earlier as I did an MBA by correspondence studies, worked 15 years importing spare car parts mostly from China, for Japanese cars. Nowadays, after losing my position in an office job, doing a cleaning job for 8 years, mainly amongst uneducated minority foreigners, one gains a different perspective. Of course if I were just more socially competent or technically capable or fexible I might well have been able to keep my footing in my particular specialty. Regardless, I feel better on the whole for the life change from a stultifying atmosphere I had lived in since being plumped onto a school dssk wth 6 years old.

Now I have read that many millions lost their jobs after 2008 and in general got rehired somewhere or other, generally with a 1/3 pay cut, as I managed, not having earned much beforehands anyways. The next crisis is apparently upon us after 10 years. Reports have been that bank and corporate debt has been shifted to governments, who saved them in 2008, and there is no higher authority to save them, so countries will simply go bankrupt under weight of debt as taxes aren't paid and unployment benefits skyrocket.

The system of 'welfare for the rich' along with a bloomjng internet has informed the general populace of the plutocratic rule, resulting in revolts in most countries by the ballot box or on the streets. Communism was proven ineffective in practice. The new aristocraty senses correctly that private citizens are better capable of making decisions than overbloated gvernment bureaucracies. However the diametric opposite of one evil is just as evil. Exactly as in the 19th century, when Marx was writing, a gilded age of exploitative monopolies, greedy robber barons, huge wealth inequalities has taken hold where the wealthy control thd government through corrupt influence. So their hypocrisy is to maintain that the system of government is bad, while in effect they own it lock, stock and barrel, write the laws, dictate policy for their corporafe interests.

It seems cyclical that Russian sciety collapses a generation before ours, as in the last crisis with their revolution folowed by the 90s crisis and our depression followed by our current crisis. Moderation in governmemnt and corporate influence, wherever we live, would be best but it remains difficult to acheive due to momentum of institutions over time to accumulate power. So essentially since reform is imossible due to inertia (comarable to a sick patient due to decades long poor habits) that a crisis forces change due to impossibility of continuity.

Divide and conquer plus cooptation of leadership worked for the British Empire for centuries and is working just fine to control the racial, ethnic, sexual minorities from one another and to keep the upper middle class, 10-20%, fighting tooth and nail, to belong. So enough distractions are there while extreme capitalism feeds on us all like vultures on dead carrion instead of being productive with middle class businesses, less govt. involvement. Moderation in all things is however not the mootto at the end of an age and we all know history and wisdom runs in cycles.

Gloucon X said...

“It was national governments, to repeat, that emerged in the middle third of the twentieth century as the supreme economic authority, effectively regulated financial markets and other parts of the economy, and gathered and redistributed resources on a massive scale.”

Maybe it’s something as simple as vested interests pushing the case for more freedom to make money as the memory of the Great Depression faded. Should we really have believed that the corporate sector would permanently accept those mid-20thc ideas about regulation and redistribution, ideas that they resisted from the start? The most financially powerful sectors of our society did fight back against those very real threats to their wealth, and they won. Rather than trying to play generational blame games, what's wrong with accepting that the most powerful forces in society do quite often do get what they want? It would have happened under whatever generation happened to exist. Indeed, we have seen the same sheeplike fealty to corporate hegemony over ideas within post-boom generations who are now as old as 54. Free market ideology and fundamentalist Christianity were the two major founding ideas of 17thc British colonists, and they still rule most American minds. It seems quite naive to expect that any single American generation could or would completely turn their backs on them.

Bruce Wilder said...

It is interesting to me that in American politics, proposals for ideas countervailing to neoliberalism in economics should invoke the New Deal: "Medicare-for-all" or tuition-free college or "a Green New Deal" are more slogans than policy programs at this point, and they depend for their imaginaries, nostalgia for a politics few people can remember.

The actual New Deal was a terrific political struggle over the distribution of income against a class of the wealthy that was fractured. Very conservative even reactionary figures contributed crucial ideas and support to particular New Deal reforms, and local notables and political machines were important parts of the partisan Democratic coalition.

Our current oligarchy of billionaires or media conglomerates or massive banks seems far more homogenous and far less numerous or diverse in its outlook and interests. Maybe they will manage the slow devolution of civilization without losing their place after all.