Outside the Asylum

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Come outside.

Capitalism has a catechism. We've all heard it. Like most catechisms, it exists to define orthodoxy and silence dissent. It's one of my goals to take apart the great statements capitalism makes about itself and make each the subject of an essay. But first, let's look at the idea of the catechism itself.

There are a whole lot of reasons why capitalism is better than every other alternative, to such a great degree that there really are no viable alternatives to capitalism. We get told these reasons when we're young, and are reminded of them as adults whenever we make a criticism of our society or disagree with somebody important. These reasons could be loosely described as The List of Why We Can't Have Nice Things, but for the formality and gravitas with which they're deployed, as if the person speaking them were Moses on the mountain.

One of my favorite examples of this phenomenon is:

You can't create demand.

Feel the authority of that, the solidity. The person speaking might as well be Einstein saying "You can't create or destroy energy," or your Mom saying "You can't flap your arms and fly." The fact that, not only can one create demand, but there is a multi-billion-dollar industry designed to do just that (it's called marketing), makes no dent in the graven tablet held close in the arms of the nineteen-year-old Republican college student debating me (we were friends in high school, before he went to UVA and came back even further to the right than he was when he left).

If you mention the existence of marketing, this person talks about vibrating toilet seats. Vibrating toilet seats prove that marketing has no influence on people, and that advertisements are sort of like a kiosk in an airport. Like someone looking for the right gate to board his airplane, the prospective consumer needs to know where to go to satisfy his pre-existing wants, and, like a televised information desk, advertisements provide that service. No manipulation is happening; the market is driven by, nay, created by, the desires of consumers. It's populist (sort of), at least as long as a large enough percentage of the people are actually able to buy anything. Vibrating toilet seats prove this fact, because they were promoted in advertisements and failed. You see? It really is the desires of the masses that drive the market!

Unfortunately, the fact that indoctrination occasionally fails to work, as when the establishment attempts to sell vibrating toilet seats, or Hillary Clinton as a presidential candidate, doesn't mean that demand, like energy, can be neither created nor destroyed. The market is not determined by the desires of prospective buyers--at least not the bottom 80% of prospective buyers--and advertisements are not designed to be informational, but persuasive. But you can't argue with the catechism. Its adherents believe in it with total confidence, and you'd better believe in it too, or you will find yourself counted among the troublemakers and the insane.

But back to the idea of the catechism itself. Isn't it interesting that capitalism needs this list of precepts handy, like a flyswatter on the porch? Why are there so many flies around here? Could they be attracted to the rotting corpse on the porch? Certainly not. There is nothing rotten in the state of Denmark. We just need another flyswatter. More and better flyswatters!

Maybe the reason capitalism has to have a list of justifications at its elbow is that capitalism doesn't look very good at first glance. It is, after all, the philosophy or practice which regularly justifies slave labor, mass imprisonment, poverty, poisoned water, starving children, and oil wars. The uninitiated might mistake it for a cruel, sociopathic force with no moral compass and a prodigious body count. It's a good thing we have a catechism, isn't it?

Today, inspired by Joe Biden, I'd like to look at one of the pillars of capitalism's catechism: the notion of quality.

“We’ll make sure it’s not quality, we’ll make sure it’s only affordable.”
--Joe Biden on health insurance

The notion of quality in capitalism is very similar, but not identical to, the concept of merit. Merit applies to people; quality applies to goods and services. However, both work the same way. The basic idea is that there is a scarce resource, and many people (companies, nations, etc.) competing for it. The result? The cream rises to the top.

As competitors strive to gain the dollars of prospective customers, they try to outshine each other by creating better and better products and services. The shoemaker who makes the best shoes will get more customers than the shoemaker who makes worse shoes. He will then become more successful and prosperous than his competitor, showing that he is a person of merit. Please note that in this vision of capitalism, all other factors have been invisibly made equal, their effect zeroed out. For instance, it's not harder to get to one of the shoemakers than the other. Time and space have no bearing on the matter. Further, one shoemaker does not charge more than the other, or if he does, that has no impact on sales because all potential customers magically have the amount of money necessary to support his good shoes, and enable him to make more of them. Customers always have free choice. It's written right here on this big stone tablet.

You don't, for instance, have a large crowd of people who can't afford good shoes and buy crap from the crappy shoemaker because it's all they can afford. Neither do you admit to any problem with, shall we say, ingredients. Somehow the skill and ingenuity of the craftsman is supposed to make up for the fact that better shoes are made out of better materials, and better materials tend to cost more than inferior ones. So the guy making handcrafted shoes out of Italian leather is going to make better shoes than the guy working on a factory line making shoes out of the leavings of petroleum processing, just like the guy hand-carving a solid wood bookcase will end up (assuming equal levels of competence) with a better bookcase than the guy slotting together pre-punched particle board pieces. Massive numbers of people are not going to flock to the Italian cobbler and the Amish woodworker, however, regardless of how wonderful their products are. In fact, you might almost say that massive numbers of people will eschew the two superior craftsmen exactly because they create a high-quality product. In a capitalist world, a high-quality product is a high-price product, and a high-price product, by definition, is something that can be afforded only by a minority of the population.

The lower the quality, the lower the price. And that's just talking about raw resources. We haven't even gotten into labor yet.

How about the fact that it takes longer to hand-craft a pair of shoes than to stamp one out on a factory line? How is the meritorious cobbler supposed to make a living when he can only serve one customer while a factory down the road is serving thousands? How is the trained gourmet chef supposed to make a living when McDonald's is down the road. They have billions served; he doesn't, and can't. What can he do?

The answer of course, is that he can provide quality to a considerably smaller clientele, who can afford high prices.

So quality is not something that capitalism maximizes or promotes. Quality is something that capitalism makes scarce. Capitalism makes the production and possession of quality goods more difficult, and less likely, rather than the reverse. If quality is the destination, capitalism is the roadblock, the closed (or maybe broken) bridge. And that's leaving out the existence of the troll under the bridge. What I've been criticizing here is vanilla capitalism, capitalism as it's supposed to function according to the descriptions of its adherents. I've not been discussing capitalism as we experience it daily, with its array of cartels and company stores, and its ever-present entourage of professional liars.

Ironically, the only way capitalism could do what it claims to do, and promote quality, is if it became a mixed economy, with some socialism and regulations thrown in to the general laissez-faire churn of the machine. The profit motive, unalloyed, drives people to cut costs, both in labor and materials. In fact, it could be argued that the profit motive, unalloyed, often makes people settle for less quality, whether they're making a thing, buying, or selling it, and whether they're happy about it or not.

We often dress that resignation up and call it virtue. But more on that next week.

How are you all today?

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Comments

QMS's picture

The affordable quality of this essay is like the clean, cool breeze here in Maine.
Ahh
Happy Sunday!

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Listen to your higher mind.

Cant Stop the Macedonian Signal's picture

@QMS

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

Cant Stop the Macedonian Signal's picture

It's nice to "see" you.

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10 users have voted.

Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

Raggedy Ann's picture

I like the topic you’ve chosen for the next few weeks. I definitely need the information.

How is Bye-done still afloat? That ship must have several leaks by now! All hands on deck ain’t gonna help!

High and dry in the land of enchantment. Went north to Santa Fe yesterday and lamented about how dry it is out there. As we drove past the Zorro Ranch - that of a J. Epstein - we wondered if the FBI had been there yet. Heard all persons who ever worked there were being interviewed. Know one of them...

Anyhoo ~ have a beautiful Sunday, folks! Pleasantry

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“It is dangerous to be right in matters on which the established authorities are wrong.”

-- Voltaire

Cant Stop the Macedonian Signal's picture

@Raggedy Ann

I bet you already know most of the points I'm gonna bring up. But as somebody said--I think George Orwell--we have now sunk to a depth at which restatement of the obvious is the first duty of intelligent men.

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

Raggedy Ann's picture

@Cant Stop the Macedonian Signal
We must become broken records!

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5 users have voted.

“It is dangerous to be right in matters on which the established authorities are wrong.”

-- Voltaire

Anja Geitz's picture

I had a customer the other day blather on about how she heard this "funny" story on the radio where a Latin American woman was talking about life under "socialism" (which for this customer meant that you could only buy one kind of onion at the store).

Had I not been hamstrung by the fact that I was acting as a representative for the friendly experience that is Trader Joe's brand, I might've said to this woman that idiotic arguments aside, I think I could live with the tragedy of only having one goddamn onion to choose from if it meant that I was able to afford life saving medication for my child because "socialism" reigned in predatory price gouging from blood sucking pharmaceutical companies.

But I couldn't say that. All I could do was smile at this fatuous woman and tell her that I couldn't talk about politics at work.

So, there's my example of the effects of another kind of catechism.

Thanks for a wonderfully thought provoking essay this morning.

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Play me another broken record Joe. Maybe then I'll learn why we pay twice as much for healthcare as everybody else in the world. ~ Not Henry Kissinger

Cant Stop the Macedonian Signal's picture

@Anja Geitz

I still want to catch up with you. I'm sorry if I let that fall through the cracks. I have been major spacey the last few weeks.

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

enhydra lutris's picture

metaphor. I never was subjected to a formal, openly declared catechism, so it would never have occurred to me to apply the term to other things, but seeing how you've used it here, I now see that various intermingled catechisms have pervaded most aspects of life here is the US throughout my life and, I suspect throughout history. These are the stories and myths that we ingest like "gospel" so early and often that they become art of the framework from which we hang out conceptual models. Bravo! Just trying to write about causes an awareness of layer after layer to bubble up, each with a little tag saying"this too needs exposure and further re-examination". Thanks.

Thanks also, of curse, for essaying to dissect the major myths of the capitalist dogma. There are great walls and structures of cognitive dissonance embedded there that are either invisible, like the fnords of "fiction", of simply too stressful to contemplate and examine for any length of time. Hell, anybody can see that the system doesn't work for shit, yet the rhetoric and rationalizations are so all pervading that the merest relaxation of a hardcore directed focus on the "what is" immediately drops one back into a smothering all-pervasive conceptual quicksand of the catechism you are calling out. Thanks so very mucho.

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That, in its essence, is fascism--ownership of government by an individual, by a group, or by any other controlling private power. -- Franklin D. Roosevelt --

Cant Stop the Macedonian Signal's picture

@enhydra lutris

Thank you, enhydra lutris.

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

We did a group Halloween costume a few years ago and it was classic WWF. I was Macho Man and everywhere we went, people loved it! Dude was something special, for sure. It was fun getting to play that character for a day.

Wrestlemania 3! Wow, takes me back. Heh.

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Cant Stop the Macedonian Signal's picture

@Dr. John Carpenter

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

mhagle's picture

Not sure that this is a connection, but somehow it makes me think about efforts to learn to really cook well. Inexpensive ingredients can be made to taste wonderful. Maybe really off topic?

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Marilyn

"Make dirt, not war." eyo

Cant Stop the Macedonian Signal's picture

@mhagle

Please spin out the metaphor!

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

Cant Stop the Macedonian Signal's picture

@mhagle

you meant literally, didn't you? That's even more interesting. Tell me more!

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5 users have voted.

Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

we still have to explain to people, and even to ourselves, why capitalism isn't the be-all and end-all?

This:

The uninitiated might mistake it for a cruel, sociopathic force with no moral compass and a prodigious body count.

was a sweet little snark.

In any case, your notes on the fate of quality under capitalism correspond with certain observations I've been making for years, including, probably, on this site. One of the most significant weaknesses of markets (free or otherwise) as solutions to "the economic problem" (as the initiates are taught to call it) is that any given product "must" have the same price for everyone. This is such such a serious problem that the marketing and merchant classes devote extraordinary efforts to getting around it. The traditional methods have been such techniques as senior discounts, discount vs retail shopping, coupon clipping -- anything that permits them to sell an identical product at different prices to people of different economic means.

In our modern economy, an alternative is to produce durable goods according to tiers of quality, thus avoiding the difficulty of "different prices for identical products". A typical brand (i won't say "manufacturer", as few goods are anymore manufactured by the company whose logo graces the final product) of dishwasher has either 3 or 4 quality tiers. The first tier is absolute junk -- a $300 machine unlikely to last 3 or 4 years before requiring a repair: A repair that will never be done, because it will cost at least $150 in parts and labor. The second tier ($450 - $550) is somewhat more reliable (though not fully so) and lacks certain features and conveniences. (Those features might include considerations of the environment, e.g. efficient use of energy and water. Thus, an ethical concern for the planet and the wellbeing of future generations has been rendered a target for market segmentation that can be exploited for extra profit.) The third tier, unlike the first two, is a machine actually made according to our true capacity for quality and durability. It costs $650 or more. (The fourth tier, if it exists, distinguishes itself mainly in the luxury of its aesthetics, rather than in any functional sense.)

In a perfect world, only the third tier machine would exist. Explaining how and why the existence of tiers one and two are an outrage to any decent sense of virtue would require the writing of a book -- one of several I will never write. I will only note that if the only tier manufactured were tier 3, the marginal "cost" (insofar as any thoughtful person is interested in the "costs" of things as expressed by a market system) of the last unit built each years would be far, far below the $350 or so that between the gross margin of the manufacturer and the markup of the dealer results in a final, universal price of $650 and up. This would bring us back to the original difficulty -- how can I sell that machine to someone for $300, while selling the first machine off the same line to someone else for $800?

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The earth is a multibillion-year-old sphere.
The Nazis killed millions of Jews.
On 9/11/01 a Boeing 757 (AA77) flew into the Pentagon.
AGCC is happening.
If you cannot accept these facts, I cannot fake an interest in any of your opinions.

enhydra lutris's picture

@UntimelyRippd
"dress", but it is interconnected and re-orders your soap for delivery at a time when your google calendar says you will be a home whenever it gets low.

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That, in its essence, is fascism--ownership of government by an individual, by a group, or by any other controlling private power. -- Franklin D. Roosevelt --

thanatokephaloides's picture

@enhydra lutris

The 4th tier not only has profound aesthetics and choices of "dress", but it is interconnected and re-orders your soap for delivery at a time when your google calendar says you will be a home whenever it gets low.

Ah yes, the Incredibly Dangerous Internet Of Things (I.D.I.O.T.) !!

Biggrin

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"I say enough! If Israel wants to be the only superpower in the Middle East then they can put their own asses on the line and do it themselves. I want to continue to eat."
-- snoopydawg

enhydra lutris's picture

@thanatokephaloides

BTW, "marginal cost" is a phantom, useful for planning and budgeting only, and unrelated to reality in today's production environment. Design and planning come up with a new octagonal widget, we design the production process, check out our sourcing options, do our market research, and commit to an initial production run of 1,000 units. We can compute the per unit cost for any given size production run, and it will be lower for larger runs because sunk costs are spread over greater numbers, but there is the rub, sunk costs. Assuming that we can move the product, the sunk costs for the first batch are sunk at the outset, so the entire first production run has a set identical per unit cost except as to real-time fluctuations in variable costs like electric rates or raw materials and/or transport costs, all of which can go both up and down.

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That, in its essence, is fascism--ownership of government by an individual, by a group, or by any other controlling private power. -- Franklin D. Roosevelt --

Cant Stop the Macedonian Signal's picture

@UntimelyRippd

Explaining how and why the existence of tiers one and two are an outrage to any decent sense of virtue would require the writing of a book -- one of several I will never write.

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6 users have voted.

Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

thanatokephaloides's picture

Another item in this catechism, desperately needing debunked, is this:

"The unregulated free market is the answer to all socioeconomic problems."

It's crap for a full panoply of reasons, of course; but the most important of these is: the "unregulated free market" does not and cannot exist. Either democratically elected governments regulate for fairness, safety, and maximum freedom of enterprise, or the biggest and most powerful players make the rules to favor themselves alone. Laissez-faire is actually impossible to achieve here.

The advocates of laissez-faire capitalism are those who would make the rules in an unregulated market, or those whose brains are owned by the same like your Republican f(r)iend....

And a fine morning to you, CSTMS! Smile

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"I say enough! If Israel wants to be the only superpower in the Middle East then they can put their own asses on the line and do it themselves. I want to continue to eat."
-- snoopydawg

Cant Stop the Macedonian Signal's picture

@thanatokephaloides

Always great to "see" you, Than.

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Actually, the issue at stake is patriotism. You must return to your world and put an end to the Commies. All it takes are a few good men.
--Q

Exit polls not involving George W. Bush or Hillary Clinton tend to be quite accurate.
--Doug Hatlem

Said the tombstone of the p.r. and advertising industries and of MSDNC and FOX News. R.I.A. (Rest in Agony).

I am currently reading Ted Kennedy's memoir. I'm up to the part where Cuber (sic) overthrew its corrupt dictator, Batista, and then had the nerve to start exporting sugar to Russia in exchange for oil and grain. On top of that, a few months later, it (*clutching pearls*) established diplomatic relations with Russia. The memoir states that those things were a threat to US national security, triggering the duty of the POTUS to take action. Says it as though it were saying "Demand cannot be created. (Wouldn't be the first time that the US believed that its national security depended upon a corrupt dictator or monarch, now, would it?)

He writes so casually of a CIA-driven plot to oust Castro that it's almost as if regime change by another sovereign nation doesn't violate international law.

We're so deep into the rabbit hole that, by 1960, we'd already forgotten what ground level looked like.

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