Category Archives: Crisis of Capitalism

Possessive Individualism

Behavioural and experimental economics — not to speak of psychology — show beyond any doubt that ‘deep parameters’ — peoples’ preferences, choices and forecasts — are regularly influenced by those of other participants in the economy. And how about the homogeneity assumption? And if all actors are the same – why and with whom do they transact? And why does economics have to be exclusively teleological (concerned with intentional states of individuals)? Where are the arguments for that ontological reductionism? And what about collective intentionality and constitutive background rules?

— Lars Syll, RWER, Economic modeling — a constructive critique, Jan 12, 2023

The Enlightenment gave us the idea of the individual as an independent sapient being. Freed from superstition and official dogma, the individual was now in comprehensive control of her innate and acquired capabilities. Fearing the loss of moral certitude, Immanuel Kant found a substitute—it was moral to be rational and rational to be moral. The young discipline of economics embraced this newly created autonomous agent and assigned that individual the task of rendering rational—self-interested—choices. Such choices revealed true value: the rational individual could not be wrong about her choices. Individualism was now wedded to acquisitive behavior. (Bromley 2019, ix)

Max Weber’s The Protestant Ethic and the Spirit of Capitalism provided theological gloss to the emergent culture of enterprise and striving. By the middle of the twentieth century, economics had become the civic religion of the modern industrial state whose purpose was to provide ever-increasing living standards for its citizens. As with daily weather updates, certain economic data came to define life under industrial capitalism. The unemployment rate, daily movements in the stock market (including those in far-off places), and the latest perturbations in the consumer price index became the contemporary equivalent of ancient astrological sightings. (Bromley 2019, ix)

By the end of the twentieth century, industrial capitalism—with a new global reach—had given way to financial capitalism. As the twenty-first century dawned, there was yet another transition underway: managerial capitalism. The Great Recession of 2007-2009 delivered a surprising destructive shock to large swaths of the population in western Europe and the United States. The angst and anger produced by that disruption have not abated. An abrupt loss of faith in the presumed beneficence of capitalism coincided with mounting despair—and political revolts—in the Middle East, parts of Latin America, and much of Africa. Immigrants became a threat to the comfortable social compact that had defined life since the end of World War II. The political class, regardless of party affiliation, was now bereft of ideas. (Bromley 2019, ix)

The lack of comprehension is to be expected. Govening elites have been mentally nurtured on the defining fiction of modernism. The autonomous acquisitive individual was both rational and moral. The civic religion provided the necessary benediction. The destructive paralysis was abetted by a fiction within a fiction. The civic religion had managed to insist that the economy—the “market”—is a separate and quite delicate sphere of efficiency and rectitude. When held up against the self-dealing incoherence of politics, tampering with the economy can only inflict harm. Kenneth Arrow proved that social choices were inconclusive and contradictory. Only markets offered consistent clarity. Politicians must not interfere with the mystical workings of the economy. Private firms, praised as “job creators,” now comprise the sacred temples of modern capitalism. Government intervention in the markeet is dangerous and must be avoided. This protected realm is the fragile fount of future well-being. (Bromley 2019, x)

Ironically, the autonomous individual is now unwittingly accomplice in his own economic marginalization. Dependent on the constellation of sanctified private firms for his precarious livelihood, he is unknowingly enlisted in the self-defeating cause of laissez faire. As politicians in western Europe and the United States quake and bluster before the alleged hordes of migrants seeking a better life, their constituents—nervous victims of the abundant caprice of managerial capitalism—exhibit behavior that further confounds the anomie and paralysis. (Bromley 2019, x)

Possessive individualism both reigns and incapacitates. (Bromley 2019, x)

(….) [T]he discipline of economics—building on the created individual of the Enlightenment—has crafted a suite of concepts and practices that constitute justificationism. … [M]uch of contemporary economics is misleading in its assumptions, willful in its presentation, and contrived in its conclusions. The central idea of rationality—the rational individual and rational choice—is circular and thus a profound deception. Its purpose has been to situate economic calculation—maximizing utility—at the center of human behavior. To borrow from Gertrude Stein, I will show that there is no there there. (Bromley 2019, xi)

The popularity of contemporary economic concepts and the acquired habits of mind on those concepts will be exposed as the perverse contamination that has undermined the aspirations of the Enlightenment. Freed from the chains of ancient superstition, the individual was soon reenslaved in the service of industrial capitalism and its offspring. Today the liberated individual is a nervous striver seeking something that relentless acquisitiveness cannot provide. (Bromley 2019, xi)