Abundance and Scarcity

People for about the last century or so have looked forward to a future period of ‘abundance’. J.M.Keynes, for instance, suggested that before long, we will have to consider the problem of how to find things to do with all our free time. These predictions haven’t come true and there’s a reason – without revolution they can’t.

Let’s define “abundance” in labour-related terms: it’s the point at which people feel no need to do unpleasant work to acquire an income so as to purchase things (work that’s actually pleasant can be done for its own sake, but is then strictly speaking more like ‘play’).

How do we get there? Broadly speaking, the main route would surely be labour-saving technology – ways of getting things done in shorter and shorter periods of time. There might be other routes – like personal asceticism, for instance (I just stop wanting the things I would buy). Increases in output and efficiency are equivalent to labour-saving, since they allow the same product to be produced with less time.

As technology of this sort progresses, we would expect people to become, broadly speaking, ‘richer’ – being able to get more stuff, while keeping more leisure time. The ‘marginal utility’ of working goes down slowly, as people think ‘I’ve got pretty much what I need, actually – why should I work more?’

But. Problem. If some task that previously took a lot of labour now gets done quickly, there’s no need to employ the person who was previously doing it. They are, in fact, now out in the street. Their income is now very much reduced. They can’t buy the products that are now so easily and abundantly made (unless everyone gets hugely indebted – there’s absolutely no risk of that going horribly wrong…). Their marginal utility of working shoots up again – they desperately need to find a job.

This applies generally across the economy. What lowers the marginal utility of working (through labour saving), then raises it again (through unemployment). In proportion as we get better off, we get worse off. The result is one of two things. Either we artificially prolong scarcity by inventing endless new stupid jobs to do, and corresponding endless new things we ‘need’ to buy, or we approach a situation where we are so fantatically wealthy that a thousand times the goods needed to satisfy anyone’s desires are easily available…but no-one can buy them. Or to re-phrase, the goods exist but are all owned by capitalists who can’t use most of them. The rest of us sit around unemployed, scrabbling for a crumb. Of course, such a situation would actually produce a vast economic crisis first, because if nobody can buy goods there’s no profit on them, so they stop getting made.

Anyway, the point is – capitalism builds in scarcity. It’s a design feature. Under capitalism (abstracting away from welfare states and so forth) people can only get any access to the wealth that their ancestors have built up if other people are unhappy and desperate enough to work to buy the things that capitalists employ them to make. Under capitalism, technological improvements cannot be used rationally, but must be used to impoverish. They can only be used rationally with a (democratically, collaboratively) planned economy – indeed, that’s kind of the definition.

And not only is revolution necessary for abundance, it is, arguably, sufficient. That is – current global wealth could provide everybody with what many previous generations would have called ‘utter abundance’. Enough food, somewhere to live, security, sociability, culture, communications, transport, electricity. But that’s harder to be confident about, because abundance is partly psychological – if you desperately need a sports car to fill the void in your soul, then not having one will be ‘scarcity’. But on that we need only observe that billions and billions of pounds are spent every year to manufacture this kind of psychological scarcity through advertising.

In conclusion, capitalism is bad. Forward to the playful communist utopia!

13 Responses to “Abundance and Scarcity”

  1. Abundance and Scarcity « Directionless Bones | Manifest My Desire Says:

    […] See the original post here: Abundance and Scarcity « Directionless Bones […]

  2. Francois Tremblay Says:

    If you include Anarchism as a “planned economy,” then why does capitalism not count as a “planned economy”? The corporation itself is quite obviously a “planned economy,” not only that but a “planned economy” of the fascist sort.

  3. Emperor Penguin Says:

    Anarchism + planned economy = universal slavery Francois. This should be abundantly clear. Capitalism has been creating abundance pretty well. There are problems. I doubt technological change could be managed much better under anarchism/facism as you propose but that is just my hunch. I simply find the notion of centrally directed control over the whole productive efforts of the human race impossible without coercion. Your worker and peasant delegates will inevitably annoy someone enough to inspire some sort of resistance, especially when resisting will presumably be much more in fashion, i.e. after a revolution. Then you’ll have to break out the bayonets and the fun will begin. Yay.

  4. Alderson Warm-Fork Says:

    Francois: a full discussion of how I understand the idea of ‘planning’ is laid out here and here, but to summarise, I see planning as a form of humanisation, a drive to reach compromise and agreement with other people as people. Fascism and Stalinism are indeed planned, but on the basis of authority (hence ‘humanising’ in a defective way – people are still seen as people, but either as slaves or masters). Capitalism as a whole is not planned (though individual corporations certainly are) because economic actors confront each other as impersonal forces that must be manipulated. In this sort of interaction there’s no drive towards overall mutual satisfaction because no actor has any reason to seek the ideal solution for others as well as themselves. As a result, what ultimately happens may be a prisoner’s-dilemma type failure, and even if not, cannot be attributed to any person or group of people as ‘their action’.

    I’ll admit this approach is somewhat vague and involves many statements that are true not absolutely but only on the whole. The short answer is, as long as different corporations are antagonistic to each other, capitalism is not planned. If, of course, all (or almost all) economic activity was controlled by a group of vast corporations, all of which co-operated in a “global cartel”, then capitalism would qualify as planned – just planned by an elite (quite possibly a batshit insane one), and not the general population. This would have advantages and disadvantages.

    Richard: capitalism has not remotely created abundance, by the definition I used above.

    “I simply find the notion of centrally directed control over the whole productive efforts of the human race impossible without coercion.”
    Good for you.

    “Your worker and peasant delegates will inevitably annoy someone enough to inspire some sort of resistance”
    If people don’t like the plan, they don’t need to follow it (they may not receive as many of the benefits of the plan, but there’s no need for bayonets). If you, me, and Francois are going on a roadtrip, if one of us disagrees strongly with the plan, they don’t have to follow it. But we’ll still all be better off if we have a plan.

  5. Francois Tremblay Says:

    What you said has required a slight adjustment in my worldview, but now that I have done so I agree with what you’re saying. The way you use “planning” makes a great deal of sense and in fact relates to some things I’ve been writing about.

    “Capitalism as a whole is not planned (though individual corporations certainly are) because economic actors confront each other as impersonal forces that must be manipulated.”

    Oh, I wouldn’t say that’s true. I think there is a definitely a sense in which we can say there are classes of economic agents just like they are classes of people, and that there is such a thing as a corporate class interest.

    “The short answer is, as long as different corporations are antagonistic to each other, capitalism is not planned. If, of course, all (or almost all) economic activity was controlled by a group of vast corporations, all of which co-operated in a “global cartel”, then capitalism would qualify as planned – just planned by an elite (quite possibly a batshit insane one), and not the general population.”

    I think the reality is more in-between. I don’t believe corporations are “antagonistic” towards each other in general, but I don’t believe there is one global cartel that controls all economic activity. We have to look at “industry strategies,” how the need to shape public policy creates corporate alliances and wars, and so on in order to get the big picture.

  6. Alderson Warm-Fork Says:

    “now that I have done so I agree with what you’re saying”
    Cool.

    “I think there is a definitely a sense in which we can say…there is such a thing as a corporate class interest.”
    True, but there isn’t really an institutional framework designed to express it – apart from things like governments, the WTO, etc. Which are attempts in that direction but very partial ones.

    Also, vast corporations don’t monopolise capital, even if they own a lot of it. There’s plenty of small businesses, whose relationship to the economy is very much mediated through impersonal market forces.

  7. Francois Tremblay Says:

    As I said, I think the reality is somewhere in the middle… as you said, “very partial” frameworks, coupled with the convergence of the power elite’s class interests.

  8. Eric Says:

    “Capitalism as a whole is not planned (though individual corporations certainly are) because economic actors confront each other as impersonal forces that must be manipulated. In this sort of interaction there’s no drive towards overall mutual satisfaction because no actor has any reason to seek the ideal solution for others as well as themselves.”

    By this, you mean that companies don’t spend time trying to figure out what their customers want, what will satisfy those who they sell to?

    Think about this model for economic exchange: I have good A, you have good B. I will only trade A for B if B is more valuable to me than A. And vice-versa for you. Free exchange inherently results in an increase in “overall mutual satisfaction,” without any central planning.

    You’re right that the actors in capitalist models seek “the ideal solution” for themselves. But our society has figured out ways to increase our own satisfaction through cooperation – through increasing others’ satisfaction.

  9. Alderson Warm-Fork Says:

    “you mean that companies don’t spend time trying to figure out what their customers want, what will satisfy those who they sell to?”
    Yes. Companies are uninterested in what will satisfy customers per se; they are interested in what customers will buy. Where these diverge, as they often do, companies go with the latter.

    “Free exchange inherently results in an increase in overall mutual satisfaction”
    Subject to assumptions like perfect information and rationality, zero externalities, rivalrousness and excludability, etc. etc. And relative to the pre-existing distribution. Subject to all these major qualifications, the logical theorem you state is true. The relevance of this fact to real-world societies is debatable, a debate in which I am remarkably confident we would disagree.

  10. Eric Says:

    Customers buy what they think will satisfy them. A customer will not trade X dollars for something that satisfies them less than the X dollars. There’s no divergence between satisfaction and trade. Even without all your assumptions. Note that I don’t claim that the customer will always spend their paycheck on those items that would increase their satisfaction maximally. I only claim that both parties to a trade benefit from the exchange, and submit as proof that in the assumed absence of coercion, each party is free to not make the exchange if it’s not to their benefit.

    I wonder if you’re trying to work from some external set of valuations, trying to apply your own values onto a third party trade. For example, given a market price of gold at $900/oz, someone selling their gold for $300/oz is being cheated, and is not benefiting from the exchange. I would claim that this free exchange increases overall mutual satisfaction, and anyone asserting otherwise has insufficient grounds to do so.

  11. Alderson Warm-Fork Says:

    “A customer will not trade X dollars for something that satisfies them less than the X dollars.”
    How about some actual psychology of how people make decisions, instead of these a priori reflections? Like, advertising can generate a preference for one product over another that consumers can in fact not distinguish by their actual taste/quality. Or, people’s judgements of satisfaction are time-bound, with something disadvantageous overall being desired in the moment – a momentary desire that can be and is actively manipulated. Or that the act of buying can assume a libidinal value itself, independent of the good purchased.

    Even setting that aside, as I said, each trade is against a background. If a subset of people have taken control of resources by violence, then the fact that each concession they wring out of the dispossessed population is ‘benefitting’ from that trade is of limited significance.

    “I wonder if you’re trying to work from some external set of valuations”
    No.

  12. Eric Says:

    Does your argument reduce to “people can be tricked into thinking they’re making a good exchange, when an outside observer ‘objectively’ determines they’re losing, therefore we need to have a ‘planned economy’ where many significant choices are made by experts”? If so, I submit that every time that has been tried, it didn’t produce any utopia.

  13. Alderson Warm-Fork Says:

    “Does your argument reduce to…”

    No, clearly.


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