Luddism and Economic Ideology

ludd1

Source: the HipCrime Vocab

Smithsonian Magazine has a very good feature on the Luddites, well worth a read. There are many elements you just don’t read in many economic histories; for example, the 40-hour work week was not brought down from the mountaintop by Moses and inscribed in stone tablets, despite what you may have heard elsewhere:

At the turn of 1800, the textile industry in the United Kingdom was an economic juggernaut that employed the vast majority of workers in the North. Working from home, weavers produced stockings using frames, while cotton-spinners created yarn. “Croppers” would take large sheets of woven wool fabric and trim the rough surface off, making it smooth to the touch.

These workers had great control over when and how they worked—and plenty of leisure. “The year was chequered with holidays, wakes, and fairs; it was not one dull round of labor,” as the stocking-maker William Gardiner noted gaily at the time. Indeed, some “seldom worked more than three days a week.” Not only was the weekend a holiday, but they took Monday off too, celebrating it as a drunken “St. Monday.”

Croppers in particular were a force to be reckoned with. They were well-off—their pay was three times that of stocking-makers—and their work required them to pass heavy cropping tools across the wool, making them muscular, brawny men who were fiercely independent. In the textile world, the croppers were, as one observer noted at the time, “notoriously the least manageable of any persons employed.”

The introduction of machinery in cloth manufacture did not make these people’s lives better. In fact, it made them a lot worse:

“They [the merchant class] were obsessed with keeping their factories going, so they were introducing machines wherever they might help,” says Jenny Uglow, a historian and author of In These Times: Living in Britain Through Napoleon’s Wars, 1793-1815.

The workers were livid. Factory work was miserable, with brutal 14-hour days that left workers—as one doctor noted—“stunted, enfeebled, and depraved.” Stocking-weavers were particularly incensed at the move toward cut-ups. It produced stockings of such low quality that they were “pregnant with the seeds of its own destruction,” as one hosier put it: Pretty soon people wouldn’t buy any stockings if they were this shoddy. Poverty rose as wages plummeted.

Yes, you read that right- the introduction of “labor-saving” technology made the amount these people worked increase dramatically. It also made their work much, much more unpleasant. It transferred control to a smaller circle of wealthy people and took it away from the workers themselves. It made the rich richer, increased poverty, and tore society apart.

But more technology is always good, right?

And since history is written by the victors, “Luddite” is a term now inextricably wound up with the knee-jerk rejection of new technology. But the Luddites weren’t opposed to new technology at all! What they were fighting against was the economic conditions that took away their autonomy and turned them into mendicants in their own country:

The workers tried bargaining. They weren’t opposed to machinery, they said, if the profits from increased productivity were shared. The croppers suggested taxing cloth to make a fund for those unemployed by machines. Others argued that industrialists should introduce machinery more gradually, to allow workers more time to adapt to new trades.

The plight of the unemployed workers even attracted the attention of Charlotte Brontë, who wrote them into her novel Shirley. “The throes of a sort of moral earthquake,” she noted, “were felt heaving under the hills of the northern counties.”

[…]

At heart, the fight was not really about technology. The Luddites were happy to use machinery—indeed, weavers had used smaller frames for decades. What galled them was the new logic of industrial capitalism, where the productivity gains from new technology enriched only the machines’ owners and weren’t shared with the workers.

In fact, the Luddites actually spared the machines that were used by employers who treated workers fairly. Funny how you never hear that in most popular descriptions of the Luddite revolt:

The Luddites were often careful to spare employers who they felt dealt fairly. During one attack, Luddites broke into a house and destroyed four frames—but left two intact after determining that their owner hadn’t lowered wages for his weavers. (Some masters began posting signs on their machines, hoping to avoid destruction: “This Frame Is Making Full Fashioned Work, at the Full Price.”)

Unlike today, labor actually fought back against these attempts to destroy their way of life:

As a form of economic protest, machine-breaking wasn’t new. There were probably 35 examples of it in the previous 100 years, as the author Kirkpatrick Sale found in his seminal history Rebels Against the Future. But the Luddites, well-organized and tactical, brought a ruthless efficiency to the technique: Barely a few days went by without another attack, and they were soon breaking at least 175 machines per month. Within months they had destroyed probably 800, worth £25,000—the equivalent of $1.97 million, today.

Rather than the “natural course” of free-market economics, once again it was government intervention, including brutal state violence, that made modern capitalism possible:

Parliament was now fully awakened, and began a ferocious crackdown. In March 1812, politicians passed a law that handed out the death penalty for anyone “destroying or injuring any Stocking or Lace Frames, or other Machines or Engines used in the Framework knitted Manufactory.” Meanwhile, London flooded the Luddite counties with 14,000 soldiers.

By winter of 1812, the government was winning. Informants and sleuthing finally tracked down the identities of a few dozen Luddites. Over a span of 15 months, 24 Luddites were hanged publicly, often after hasty trials, including a 16-year-old who cried out to his mother on the gallows, “thinking that she had the power to save him.” Another two dozen were sent to prison and 51 were sentenced to be shipped off to Australia.

But wait, isn’t capitalism all about “freedom and liberty?” Freedom and liberty for some, I guess.

The problem, then as now, was not technology itself, but the economic relations that it unfolded against. What I found most interesting is that even back then, the emerging pseudoscience of economics was used to justify the harsh treatment of the workers and the bottomless greed of capitalists, in particular the “sacred text” of modern Neoclassical economics, Adam Smith’s The Wealth of Nations:

For the Luddites, “there was the concept of a ‘fair profit,’” says Adrian Randall, the author of Before the Luddites. In the past, the master would take a fair profit, but now he adds, “the industrial capitalist is someone who is seeking more and more of their share of the profit that they’re making.” Workers thought wages should be protected with minimum-wage laws. Industrialists didn’t: They’d been reading up on laissez-faire economic theory in Adam Smith’s The Wealth of Nations, published a few decades earlier.

“The writings of Dr. Adam Smith have altered the opinion, of the polished part of society,” as the author of a minimum wage proposal at the time noted. Now, the wealthy believed that attempting to regulate wages “would be as absurd as an attempt to regulate the winds.”

It seems as though nothing’s really changed. Using economic “science” to justify social inequality and private ownership goes back to the very beginnings of the Market.

When Robots Take All of Our Jobs, Remember the Luddites (Smithsonian Magazine). Smithsonian wrote about this before, see also: What the Luddites Really Fought Against

As the above history shows, there is nothing “natural” or normal about extreme busyness and brutally long working hours. It is entirely an artificial creation:

A nice post at the HBR blog…describes how being busy is now celebrated as a symbol of high status. This is not natural. Marshall Sahlins has shown that in hunter-gather societies (which were the human condition for nine-tenths of our existence) people typically worked for only around 20 hours a week. In pre-industrial societies, work was task-oriented; people did as much as necessary and then stopped. Max Weber wrote:

“Man does not “by nature” wish to earn more and more money, but simply to live as he is accustomed to live and to earn as much as is necessary for that purpose. Wherever modern capitalism has begun its work of increasing the productivity of human labour by increasing its intensity, it has encountered the immensely stubborn resistance of this leading trait of pre-capitalistic labour. (The Protestant Ethic and the Spirit of Capitalism, p24”

The backward-bending supply curve of labour was normal.

E.P. Thompson has described how pre-industrial working hours were irregular, with Mondays usually taken as holidays. He, and writers such as Sidney Pollard and Stephen Marglin, have shown how the working day as we know it was imposed by ruthless discipline, reinforced by Christian moralists. (There’s a clue in the title of Weber’s book). Marglin quotes Andrew Ure, author of The Philosophy of Manufacturers in 1835:

The main difficulty [faced by Richard Arkwright] did not, to my apprehension, lie so much in the invention of a proper mechanism for drawing out and twisting cotton into a continuous thread, as in…training human beings to renounce their desultory habits of work and to identify themselves with the unvarying regularity of the complex automation. To devise and administer a successful code of factory discipline, suited to the necessities of factory diligence, was the Herculean enterprise, the noble achievement of Arkwright…It required, in fact, a man of a Napoleon nerve and ambition to subdue the refractory tempers of workpeople accustomed to irregular paroxysms of diligence.”

Today, though, such external discipline is no longer so necessary because many of us – more so in the UK and US than elsewhere – have internalized the capitalist imperative that we work long hours, …Which just vindicates a point made by Bertrand Russell back in 1932:

“The conception of duty, speaking historically, has been a means used by the holders of power to induce others to live for the interests of their masters rather than for their own.”

Against busyness (Stumbling and Mumbling)

Honestly, the five-day workweek is outmoded and ridiculous. It’s more of a babysitting operation for adults than anything else. It’s a silly as arguing that we need over two decades of formal education in order to do our jobs.

I was reminded of this over the holidays. In the U.S. we get virtually no time off from our jobs, unlike most other countries (East Asia might be an exception). But Christmas/New Year’s is a rare exception, and we have several four-day weeks in a row (without pay for some of us, of course). Those weeks are so much more pleasant, and I would even say productive, than the rest of the year. Every year at this time I think to myself, “Why isn’t every week a four-day workweek?” Some places do have such an arrangement, but they justify it by four long, ten-hour days. I don’t know about you, but towards the end of ten hours in a row of “work” I doubt anyone’s accomplishing much of anything. Is 32 hours a week really not enough to keep society functioning in the twenty-first century?

Not only that, but many people use whatever little vacation they do have in order to take the whole time period at the end of the year off. This is typical in Europe, but rarer here. In any case, while going to work I noticed that there was hardly any traffic. The roads were empty. There were plenty of seats on the bus. The streets and sidewalks were empty. There was no waiting in the restaurants and cafes. There was plenty of room for everything. There was a laid-back feeling everywhere. It was so pleasant. I couldn’t help but think to myself, “why isn’t every week like this?” If more people could stay home and work less, it very well could be. Instead we’re trapped on a treadmill. Working less would actually pay dividends in terms of reduced traffic, less crowding, less pollution, and better health outcomes due to less stress and more time to exercise.

There’s also a simple logic problem at work here. If we say the 40-hour week is inviolable and set-in-stone for the rest of time, and we do not wish to increase the problem of unemployment, then literally no labor-saving technology will ever save labor! We might as well dispense with the creation of any labor-saving technology, since by the above logic, it cannot save labor. You could equivocate and say that it frees us from doing “lower” level work and allows us to do “higher” level work, as when ditch diggers become factory workers, or something. That may have been a valid argument a hundred years ago, but in an age when most of us are low-paid service workers or useless paper-pushers, it’s pretty hard to make that case with any seriousness anymore.

***

I often refer to economics as a religion, with its practitioners as priests. So it’s interesting to read that in other contexts. This is from Chris Dillow’s blog, where the above passage about work was taken:

The social power, i.e. the multiplied productive force”, wrote Marx, appears to people “not as their own united power but as an alien force existing outside them, of the origin and end of which they are ignorant, which they thus cannot control.”

I was reminded of this by a fine passage in The Econocracy in which the authors show that “the economy” in the sense we now know it is a relatively recent invention and that economists claim to be experts capable of understanding this alien force:

“As increasing areas of political and social life are colonized by economic language and logic, the vast majority of citizens face the struggle of making informed democratic choices in a language they have never been taught. (p19)”

This leads to the sort of alienation which Marx described. This is summed up by respondents to a You Gov survey cited by Earle, Moran and Ward-Perkins, who said; “Economics is out of my hands so there is no point discussing it.”

In one important sense such an attitude is absurd. Every time you decide what to buy, or how much to save, or what job to do or how long to work, economics is in your hands and you are making an economic decision.

This suggests to me two different conceptions of what economics is. In one conception – that of Earle, Moran and Ward-Perkins – economists claim to be a priestly elite who understand “the economy”. As Alasdair MacIntyre said, such a claim functions as a demand for power and wealth:

“Civil servants and managers alike [he might have added economists-CD] justify themselves and their claims to authority, power and money by invoking their own competence as scientific managers (After Virtue, p 86).”

There is, though, a second conception of what economists should do. Rather than exploit alienation for their own advantage, we should help people mitigate it…

Economists in an alienated society (Stumbling and Mumbling)

This makes a point I often refer to – this depiction of “The Economy” as some of “natural” force that we have no control over, subject to its own inexorable logic. We saw above how the writings of Adam Smith provided the ideological justification for the wealthy merchants to screw over the workers. It cemented the perception that the economy was just a natural force with its own internal logic that could no more be regulated than could the wind or the tides. And over the course of several hundred years, we have intentionally designed our politcal institutions such that government cannot “interfere” in the “natural workings” of the economy. Doing so would only make all of us worse off, or so goes the argument.

There is a telling passage in this column by Noah Smith:

…Even now, when economic models have become far more complex than anything in [Milton] Friedman’s time, economists still go back to Friedman’s theory as a mental touchstone — a fundamental intuition that guides the way they make their models. My first macroeconomics professor believed in it deeply and instinctively, and would even bring it up in department seminars.

Unfortunately, intuition based on incorrect theories can lead us astray. Economists have known for a while that this theory doesn’t fit the facts. When people get a windfall, they tend to spend some of it immediately. So economists have tried to patch up Friedman’s theory, using a couple of plausible fixes….

Milton Friedman’s Cherished Theory Is Laid to Rest (Bloomberg)

Yes, you read that right, economists knew for a long time that a particular theory did not accord with the observed facts, but they didn’t discard it because it was necessary for the complex mathematical models that they use to supposedly describe reality. Rather, instead of discarding it, they tried to “patch it up,” because it told them what they wanted to hear. Note how his economics professor “believed deeply” in the theory, much as how people believe in the Good Book.

Nice “science” you got there.

That methodology ought to tell you everything you need to know about economic “science.” One wonders how many other approaches economists take that such thinking applies to.

Friedman was, of course, the author of “Capitalism and Freedom,” which as we saw above, is quite an ironic title. Friedman’s skill was coming up with ideas that the rich wanted hear, and then coming up with the requisite economic “logic” to justify them, from deregulation, to privatization, to globalization, to the elimination of minimum wages and suppression of unions. His most famous idea was that the sole purpose of a firm is to make money for its shareholders, and all other responsibilities were ‘unethical.’ The resulting “libertarian” economics was promoted tirelessly, including a series on PBS, by wealthy organizations and right-wing think-tanks with bottomless funding, as it still is today (along with its even more extreme cousin, “Austrian” economics). One thing the Luddites did not have to contend with was the power of the media to shape society, one reason why such revolts would be unthinkable today (along with the panopticon police states constructed by capitalist regimes beginning with Great Britain— “freedom” indeed!).

Smith himself has written about what he calls 101-ism:

We all know basically what 101ism says. Markets are efficient. Firms are competitive. Partial-equilibrium supply and demand describes most things. Demand curves slope down and supply curves slope up. Only one curve shifts at a time. No curve is particularly inelastic or elastic; all are somewhere in the middle (straight lines with slopes of 1 and -1 on a blackboard). Etc.

Note that 101 classes don’t necessarily teach that these things are true! I would guess that most do not. Almost all 101 classes teach about elasticity, and give examples with perfectly elastic and perfectly inelastic supply and demand curves. Most teach about market failures and monopolies. Most at least mention general equilibrium.

But for some reason, people seem to come away from 101 classes thinking that the cases that are the easiest to draw on the board are – God only knows why – the benchmark cases.

101ism (Noahpinion)

But the best criticism I’ve read lately is from James Kwak who has written an entire book on the subject: Economism: Bad Economics and the Rise of Inequality. He’s written several posts on the topic, but this post is a good introduction to the concept. Basically, he argues that modern economics allows policies that benefit the rich at the expense of the rest of society to masquerade as objective “scientific” truths thanks to the misapplication of economic ideology. As we saw above ,that goes back to very beginnings of “free market” economics in the nineteenth century:

In policy debates and public relations campaigns…what you are … likely to hear is that a minimum wage must increase unemployment—because that’s what the model says. This conviction that the world must behave the way it does on the blackboard is what I call economism. This style of thinking is influential because it is clear and logical, reducing complex issues to simple, pseudo-mathematical axioms. But it is not simply an innocent mistake made by inattentive undergraduates. Economism is Economics 101 transformed into an ideology—an ideology that is particularly persuasive because it poses as a neutral means of understanding the world.

In the case of low-skilled labor, it’s clear who benefits from a low minimum wage: the restaurant and hotel industries. In their PR campaigns, however, these corporations can hardly come out and say they like their labor as cheap as possible. Instead, armed with the logic of supply and demand, they argue that raising the minimum wage will only increase unemployment and poverty. Similarly, megabanks argue that regulating derivatives will starve the real economy of capital; multinational manufacturing companies argue that new trade agreements will benefit everyone; and the wealthy argue that lower taxes will increase savings and investment, unleashing economic growth.

In each case, economism allows a private interest to pretend that its preferred policies will really benefit society as a whole.The usual result is to increase inequality or to legitimize the widening gulf between rich and poor in contemporary society.

Economics 101, Economism, and Our New Gilded Age (The Baseline Scenario)

All of the above reinforces a couple of points I often like to make:

1.) Capitalism was a creation of government from day one. There is nothing “natural” or “free” about markets.

2.) It is sustained by a particular ideology which poses as a science but is anything but.

These is no fundamental reason we need to work 40 hours a week. There is no reason we have to go into debt just to get a job. There is no benefit to the extreme wealth inequality; it’s not due to any sort of “merit.” And on and on. Economic “logic” is destroying society along with the natural world and preventing any adaptive response to these crises. But its power over the hearts and minds of society seems to be unassailable, at least until it all falls apart.

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