Month / Nov 2022

by doctormcgrail

Hoisting the Jolly Roger over Supply and Demand

Why do we teach foundational economics in the way that we do? And who or what is being ‘served’ by the approach and the (presentational-representational) priorities of this existing ‘established’ episteme? I have taught a number of foundation, access, and open-entry (higher education) courses over the last two decades, including a number for the Open University (OU, module codes DD100, DD101, DD102, and DB125) and University of Edinburgh (four interdisciplinary ‘introduction to social science’ courses), which have included an introduction to or the fundamentals of ‘economics’.

In my (admittedly limited opinion), by far the best of these was the OU’s DB125 (Personal Finance), not least because it buried the theory of supply and demand to Chapter 6 – well into the book / course, once other aspects and elements of economics (and finance) had been considered.  Yep, the core of mainstream ‘microeconomics’ (the conceptualisation of the ‘economy’ being made up of households, firms, and government) was still present, but more substantially balanced by mention of so-called ‘macroeconomic’ concerns (the social and political context) as well as having students learn something practical (training in how to manage their own finances, such as cash flow, assets, and liabilities) before then – as ever –  getting into the abstract mathematical universe of ‘graphical representation’ of what is supposed to be happening.

In fact, what I most liked about teaching DB125 was that it had a ‘citizenship education’ element in the Scottish Common Sense tradition.  That is, it is helpful to society, for everyone, if everyone has some understanding of what is going on around them.  To cite Adam Ferguson, the point of moral philosophy (later ‘social science’) is to hold the powerful to account, and ignorance is never good at doing that.  Education in / about economics has to cover more than feeding an industry with ‘professional’ economists whom, typically, end up in a peculiar position within Adam Smith’s division of labour.

The Politics of Economics

But the teaching of ‘economics’ (and how to be ‘economical’) has always had a propaganda element to it.  Making sure everyone ‘knows’ what is going on can inform the public or citizenship of ‘the’ key reasons and justifications for why things are the way they are, and (a corollary of that) why things cannot be changed.  Thus, even the ‘common sense’ approach soon runs into political territory – it can be about calming resistance to the way things are, to the existing inequalities in life, on grounds that such inequalities and stoically putting up with them are simply ‘sensible’.  At the same time, what gets taught in economics (especially in further and higher education, and especially with regards to business studies and administration) needs to address the ‘output’ side of its production process, namely, the creation of economists who are well-equipped and ready to handle ‘the jobs’ they will subsequently be plugged into.  The term ‘employability’ comes into the framework; a term educational institutions are thoroughly embracing with vigour like never before.  We must do something for our students other than giving them an abstract love of learning!  But what are these employability factors and/or what ‘transferable skills’ are to be imparted by teachers to their wards?  Who better to ask, naturally, than those already within the industry.  Professional bodies and employers have a major role to play here in shaping the skill set, knowledge content, and academic standards that graduates should emerge with. 

The flip-side, or downside, of such an approach is that economic education (like any other sector of education) ends up being shaped those outside the academy (extra mural) who don’t have the independence and distance from vested interests in an industry which those inside the academic (intra mural) happen to have.  Even when Adam Smith studied at Glasgow in the late 1730s merchants were welcomed and involved (invited to take part) in university debates, and Smith’s work could be viewed as novel (for the time) in taking ‘philosophy’ into the world of industry.  It is part and parcel of common sense philosophy that such interaction takes place, but it should not be ‘dominated’ by one side or the other.  In summing this section up, there is little point in professional economists telling the academy ‘please produce more people like us’, as nothing might ever move forward.  And it is notable that both Keynesianism and Neo-liberalism both emerged from the academy and not ‘the profession’.

A Time for Questions

Notably our time is one of questioning orthodoxies.  Kate Raworth’s Donghnut Economics has raised the issue of why we persist with bog-standard microeconomics.  And to this I would add why we still feel obliged to begin economical education with ‘the market’ as presented in the form of the supply-demand graph?  From personal experience of teaching interdisciplinary students expected to learn at least something about ‘economics’ it is the way in which this is done (with an immediate ‘mathematical’ focus) which is highly off-putting.

Now, the theory of supply and demand has many, many criticisms – it is an abstract representation of an ideal and not a reflection of what happens in reality or practice.  It thereby, in philosophy of science, uses a deductive-verificationist approach.  It is expected that consumers will make pain-reducing, pleasure enhancing decisions and choices (they are mini-maximisers) and then the ‘model’ aims to demonstrate this presumption via ‘verifiable’ examples.  So, when ‘you’ are in the desert, you will not deny yourself water no matter how much the salesman, who arrives on a camel, is demanding in payment (the joke being – presuming the consumer is ‘male’ – that he will demand your mother and wife in exchange).  Water becomes more expensive than diamonds in this ‘marginal’ situation.

I remember my PhD supervisor (Derek Kerr, probably in 1990-91) referring to a quotation about supply-demand microeconomics which described it as “nonsense on stilts”: “Everyone knows its nonsense, but no-one can touch it – reach up to get it”.  As noted by Elder-Vass (2019) – who references many critical pieces of work – the theory, overall, presents impossible people in an unreal world (the flattened, very white landscape of graph paper), since no actual consumer / producer has sufficient knowledge to make the necessary effective choices for the market to work in the manner it ‘should’.  Indeed, such people are a product of habit (their own habits, plus socialisation), who rely on their feelings and emotions (such as trust in those they already know; culturally-constructed ‘personal’ desires; or socially-imposed or structured necessities) more than the supposed ‘rationality’ and ‘autonomy’ they are meant to be using to make key ‘choices’ – about what to consume or produce; or what to pay – within a subjective ‘willingness to pay’ account (see the ‘desert’ example above).  But even as I sit and drink my morning coffee (caffeine boost) in a cafe, is it true to say I was willing to pay more than yesterday because of how I am ‘feeling’ today?  Does the price of coffee really change depending on work rotas (too little rest) or celebratory contexts (a wedding attended the day before)?

Elder-Vass’s chapter does not cover every possible criticism of supply and demand, and my two favourites happen to include: (a) it is incredibly boring (it certainly puts many students to sleep, though others show ‘intrigue’ – a feeling of a need to know how this works as it is so culturally important), and (b) as a ‘social theory’ it is inadequate because it doesn’t tell us anything about the society (social formation or world) we happen to live in.  It is, to that end, completely uninformative!  But, perhaps, these are the main points of the theory – to bore, snore, and keep the lights out.

In Chapter 1 of Capital, Marx tells us that he fails to understand the fascination of political-economists with the law of supply and demand.  He makes the criticism that as soon as equilibrium price is ‘reached’ (achieved) – which is the explanatory goal of the graph, after all, to indicate how the price of a commodity is arrived at – then the law of supply and demand ceases to work – it is no longer applicable since price has been reached.  However, the commodity still has a ‘price’, and at this point we need to realise that the law of supply and demand has not explained what ‘price’ is.  We are still left with the requirement to explain what price, in and of itself, is.  Why must this thing have a price?  What is it that the owner is charging the purchaser for?

Of course, Marx is feigning his incomprehension.  Section 4 of Chapter 1 on commodity fetish makes it clear that a linen coat does not walk into a shop and exchange itself for a bag of coal.  Rather, it is the tailor who is exchanging their effort for that of the miner.  Marx’s study of commodity fetish is precisely about how and why classical political economy (of the early 19th century) had lost its ability for insight – to see what is socially significant to the form of society (mode of production) we inhabit.

If you are adverse to this point because it is Marx who is making it – his name makes you come out in a rash – then you need to be aware that Marx was able to root this point in the work of Adam Smith.  Smith’s Wealth of Nations does not ‘open’ with the law of supply and demand but with the inside of a workshop – the pin factory – where productivity is rapidly rising due to a reorganisation of the labour process (a re-division of labour to make it more ‘expedient’ – a key term from Smith’s earlier Theory of Moral Sentiments – that is, the re-division makes production more efficient such that the human animal gets more output for similar or less input).  Consequently, when Smith moves on to talk about ‘markets’ (in Chapter 3 of his work) it ‘should be’ clear that commercial society is one giant labour exchange.  Human ‘individuals’ (and Smith does, if wrongly, focuses on individual effort) are evaluating and exchanging their efforts or labours.

This point, in Smith, even though Smith is making it, is anathema to modern mainstream economics (and especially the Adam Smith Institute).  Even an expert introduction to Smith’s own work (Skinner’s introduction to the 1999 penguin edition of Wealth of Nations) want to deny or expunge Smith’s labour theory of value.  Skinner argues that Smith got his starting point wrong (the labour theory of value) and, hence, ‘later’ in the book Smith corrected his error by introducing an alternative ‘theory of production costs’ (which in Skinner’s view is the ‘correct’ approach).  Yet, Skinner was coming out of (and probably socialised within) a long tradition within mainstream economics of criticising and denying the labour theory of value.  By the 20th century, the political implications of following a labour theory of value were well-known – it leads to a land (or ocean, since I will be talking about the Jolly Roger) of exploitation.

By comparison, the theory of supply and demand is politically ‘safe’ because it is tells us nothing about what price actually is.  We get to learn that something in ‘short supply’ will rise in price, as will something in ‘high demand’.  By comparison, something in abundant supply or something in low demand will fall in price.  Wow!  That’s like saying the leaves will fall off the trees in autumn.  This event happened in ancient Rome, under mediaeval feudalism, when absolute monarchs tried to control early modernism (emerging capitalism), with industrialisation (though global warming may well witness some trees retain their leaves for longer, as the anthropocene era records human impact on nature!), and even in our own times with post-modern consumerism.  The point of natural science has not been to observe that the leaves fall in autumn – our Neolithic ancestors were able to observe this – but explain the processes which lead to leaves falling, and even why autumn leaves will be more or less colourful depending on weather conditions each summer.

The law of supply and demand is a theory which remains at a very superficial level – it states the obvious and, therein, lacks any precision about the fundamentals of ‘our’ society (commercial or capitalist society which merged as pre-dominant in the late 18th century).  But the same goes for concepts of ‘scarcity’, the law of diminishing returns, the definition of opportunity cost, resource allocation, and the notion of trading production ‘possibilities’.  Another narrative often taught in the early stages of ‘economics’ is the tale of Herman Goering aiming to convince the German public that they had a limited choice between producing butter or guns.  ‘Given’ they could not have both outputs, Goering claimed that Germany should choose guns, since these would make the nation powerful, whereas butter would merely make them ‘fat’.  But from a labour theory of value perspective, and drawing on Marx’s concept of commodity fetish, Goering was not comparing guns with butter, he was comparing the efforts of armourers (gun-makers) with those of milkmaids.  Essentially, Goering desired to impoverish milkmaids to make more room for gun-makers.  The ‘market’ is not a mystery; it is made up of humans who make socially and culturally-constructed choices.

Thus, Smith was right to contextualise the ‘market’ he observed (and analysed going beyond simple observation) as a labour exchange, and then to note (by his 6th chapter) that ‘profits of stock’ were not a result of labour or effort, but of the stockholder (owner) ‘sharing’ in the efforts of their workers (who created the ‘value’ of the goods).  The ugly face of exploitation raises itself, though this is often inconceivable by those with a vested interest in benefitting from the system – whether that is those already ‘with money’ or those who firmly believe they will ‘make money’.

To conclude, the supply-demand graph presents itself as if it is a boat on placid lake without a sail.  It is, literally, going nowhere and presents itself as a politically neutral ‘account’ of how a ‘market’ works.  But it is, in effect, a fetishized representation of the forced sale (exchange) of human labour power, as if this is a perfectly ‘natural’ state of affairs.  The boat is, in fact, the ship of Black Beard and should, to become an honest account of itself, hoist the Jolly Roger as the standard of privateers.

by doctormcgrail

Greta Thunberg on the Failure of Capitalism

Amol Rajan, Media Editor at the BBC, interviewed Greta Thunberg (Tuesday 18th October 2022) about her future – though really her “future in politics”, because without her ‘politics’ would Rajan or the BBC have been that interested in this 19 year old?   Thunberg is a political celebrity, famous for being a teenage climate activist who convinced her generation to go on ‘school strike’, and thereby have attention paid to them.

Thunberg (to use the ‘academic’ surname convention since I don’t know her personally) has done an amazing job in foregrounding not simply issues of climate change and climate justice but in asserting the highly moral standpoint that mistakes made today (including failure to adapt social processes quick enough) will be paid for by future generations (obviously her own generation and younger).  But what I like most about Thunberg is her (often) straight forward expressions regarding the human condition.  Despite her age, or perhaps because of it – just as a 3-year-old child does not understand the principle of ‘private property’ when picking things up in a shop – Thunberg sees what her elders, socialised through decades of ‘reasonable’ discourse and ideological ‘underpinnings’, cannot.

The BBC eventually advertised the interview (on their catch-up service and News websites) by quoting Thunberg’s response to Rajan’s query about her going into politics (or, what would have been a more accurate phrasing, her staying in politics)?  What Rajan meant, of course, is the possibility of Thunberg becoming an elected politician (she has never been elected and is thus defined as an ‘activist’) and, by inference, Rajan meant her becoming a ‘professional’ politician.

Thunberg’s immediate reply was unequivocal – “I don’t want to go into politics … [because] … it’s toxic”.  She did qualify this with an “at the moment”.   However, what Thunberg meant by the toxicity of politics was not that clear from my position as part of the audience.

Did she mean the typically cited ‘polar’ oppositions of ‘party’, identity, or ideological politics at the moment, with their highly divisive characters, postures, and positions (radical / conservative; left-wing / right-wing; liberal / authoritarian) as compared to a more ‘consensual’ form that ‘politics’ could take?  Or was Thunberg referring to the wider issue of politicians’ insularity (in the ‘swamp’) from the mass of people (from whom they claim a mandate) with their propensity to fail, spin, and U-turn until they serve established interests?

What I disliked about Rajan’s question, and what I would reject in the way it was posed, is the implication that Thunberg, somehow, is not already ‘in’ (involved with) politics?  The question itself – a highly leading one – presumes that ‘politics’ must take a (or one) rather peculiar form (one which Rajan is used to) which essentially refers to electoral and ‘representative’ politics as ‘politics’ in a universal sense. 

It should be obvious to any neutral observer that Thunberg is already a ‘politician’ – she is involved in politics as an active citizen, indeed, in ideality, as everyone ‘should be’!  Why then would she need to ‘go into’ that peculiar form of politics – the very activity Thunberg describes as ‘toxic’?  So far, Thunberg seems to have managed quite capably, admirably, and better than most elected / professional politicians in not being ‘a representative’ of anyone other than herself as a quintessential human being.

In this context, Thunberg’s point that even ‘she’ (in spite of all that has happened, including the way she has been thrust into the public eye) wouldn’t consider a move ‘into’ that politics (because of its toxicity) is a damning criticism of what is notionally and nominally referred to as our ‘democratic political system’.

The Failure of Capitalism (Round 1)

There was, however, an even more interesting question pitched by Rajan, drawn rapidly from his journalistic scabbard, in response to one of Thunberg’s expressional pronouncements.  Thunberg referred to “the failure of capitalism”!

Now, it may have appeared that this point or ‘claim’ came out of the blue – a shock not only to the BBC producers, but presumably to their attendant, prospective audience.  The phrase “failure of capitalism” isn’t just a question of ‘political bias’ – it goes way beyond that – since the presumption, the doxa, of British culture is that capitalism is just part of nature (not least since this is what standard, establishment ‘economics’ teaches from high school onwards – a position grounded out of socially-constructed education systems since the early 19th century).  Surely, Thunberg was trying, now, despite past successes, to defy gravity with mention of such an idea?

However, the claimants of returns on capital could rest easy, since Rajan was ‘on the ball’, and managed to demonstrate he was prepared for his quarry.  Perhaps from watching previous coverage of Thunberg, Rajan knew or guessed that this kind of craziness may well come up.  Even though Thunberg slipped the phrase “the failure of capitalism” into a longer answer – as if, for her, it was as clear as day that capitalism has failed – it was the point within Thunberg’s response that Rajan quickly returned to (and had to return to).  Consequently, he asked, in reference to the failure of capitalism, “hasn’t capitalism lifted 850 million Chinese out of poverty?”

In my own opinion, this question led to the weakest response from Thunberg, who merely reiterated the point that ‘we’ (as a human collective) still must do something to prevent future catastrophe.  Yep, I get the underlying point – this is no time to be talking about capitalism versus socialism versus ‘utopianism’ versus whatever.  Even if Chinese capitalism has lifted the poor out of their poverty (let’s accept the premise), ‘we’ are still left with foreboding and impending doom!

The step Thunberg did not take was to question Rajan’s claim or assertion directly.  If Rajan doubts she is not already ‘into politics’ he just needs to take note of her ability to avoid a journalist’s question (a question possibly intended to distract, mislead and unbalance) and to plough on in getting her key point across (in a media interview).  If Thunberg hasn’t received media training, then she has learnt from the school of trial, error, and hard knocks.  Her approach was superior to anything I would have done in the situation, in being pulled sideways to counter the attack.

Rajan’s clever assessment of what he needed to ask (in reply to Thungerg’s claim) highlights the ‘political balance’ approach of the BBC built into their interview technique.  This is not something you would get on Fox, GB News, or any politically-biased media outlet.  If someone, anyone, states ‘on telly’ that capitalism has failed, such an assertion needs to be countered and questioned, immediately, and with evidence to the contrary.

Thunberg let Rajan’s re-assertion of the advantages, achievements, or greatness of ‘capitalism’ go – she side-stepped the implied point.  It was possibly not worth fighting – not in this interview – when a more positive message about impending doom is going to achieve more from her perspective.  Of course, that does not mean ‘we’ should let Rajan’s claim stand!

Businesses Don’t Make Great Coffee – People Do

Having sought refuge in the United States, as early as 1941 Raya Dunevskaya developed and published her analysis of the Soviet Union as an example of ‘state capitalism’.  In doing so, Dunevskaya referred to a discussion by Marx on what would happen if national capital was reduced to the control of a single capitalist (a monopoly system – so no competition, nor internal struggle within the class of capitalists).  He was asking the question in relation to his own analysis – that is, would it still apply?  And the answer was ‘yes’ – the nature of capitalist exploitation, in the social form of the purchase of waged labour (at the cost of its reproduction) and this labour’s expenditure in the production of ‘surplus’ product, would not change one jot.

Of course, on this reckoning, both the Soviet Union and Communist China were similar state capitalist regimes, though with national, cultural, and historical variations.  It is not, however, wrong to call them socialist regimes, in so far as they focused on furthering ‘national’ capital (or ‘commonwealth’) at the expense of individual capitalists and ‘individuals’ per se.

In short, mainland China was ‘capitalist’ long before the ‘economic’ (but not ‘political’) reforms of the 1980s.  Mao’s China (and Mao continues to be a revered figure within China) expunged ‘peasant’ China – the ‘old order’; firstly through forced industrialisation (the Great Leap Forward of the 1950s) and then through forced socialisation (the Cultural Revolution of the 1960s).  Some of these policies were disastrous, leading to mass famine through agricultural failure – but, there again, the Irish Famine of the 1840s never did that much damage to the British Empire.  But like all ruling classes attempting to hang on to power, the Communist Party of China found itself having to reform or adapt itself to new conditions.  This began with a ‘falling out’ amongst ‘communists’ (with the Soviet Union), followed by Nixon’s visit to Mao’s China in 1972 (a ‘defrosting’ of relationships), before the ‘economic’ reforms under Deng Xiaopeng from 1982.

This produces a first counter point to Rajan: you might as well congratulate the Chinese Communist Party for lifting 850 million people out of poverty!  Indeed, any Chinese government official would make this point.  Just like everyone else, such officials are prone to see the world as of their own making.  Furthermore, Rajan made this point to Thunberg when the ‘West’ is growing distrustful of China – there is fear about the progress China has made, that it isn’t playing by the ‘rulebook’ (as understood by the Western establishment), and hasn’t been doing so for a long time, or forever – and ‘now’ it dawns on Western ‘analysts’ that the Chinese have their own agenda!  Thence, if the Chinese are not, and have never been, playing by the capitalist ‘rulebook’, what do you put the economic transformation of China down to?

Next, what Rajan means by ‘capitalism’ needs to be considered?  I don’t think he is referring, in ‘capitalism’, to the accumulation of ‘capital’ as money, consumer goods, industrial goods, nor even wage relations – the requirement for capital to purchase wage labour to expand itself (the final one being the definition Marx uses in Capital: A Critique of Political Economy).  What Rajan means is the ‘freedom’ to trade outwith the bounds of government controls and regulations, with the implication that producers and purchasers are ‘free’ to make their own ‘rational’ decisions, since the latter is the kind of populist and spurious definition given in bog-standard Western education.

But capitalism is, ultimately, about capital, a concept defined dualistically by Adam Smith to mean: (a) all the material goods in society produced by previous labour (effort), from houses, to bridges, fridges to cars, computers to forks … ad infinitum; and (b) an amount of money which provides a return (or income) to its owner.  The problem for Rajan is that Smith doesn’t bother to define ‘capital’ and its accumulation until Book 2 of The Wealth of Nations.  So, what is Book 1 about?  I think the order of presentation is important – Smith is putting the most significant elements of the new commercial system, emerging in the 18th century, first.  Smith is giving something else priority over a need to discuss the emerging (new) commercial society in terms of ‘capital’.  What can that be?

Famously, Smith opens his opus with the ‘Outline and Plan of the Work’ where he clearly states that “labour” is the annual fund which provides for all the necessaries and conveniences of life!  In Chapter 1, Smith then emphasises how it is the “division of labour” which gives rise to increasing wealth (whether of material goods or services).  In Chapter 4, Smith challenges the claim that profit on stock is a payment for the labour of direction and management – no it isn’t, he notes, because there are many profiteers of stock (capitalists) who never see, never mind manage, the businesses they benefit from.  And in Chapter 6, Smith starts by making the point that owners of stock “share” in the wealth produced by waged labourers – that the wealth is produced by the workers is obvious to Smith.  That Smith does not then ‘do more’ with this analysis, in a political sense, is what ‘shocks’ Marx – the key point is in black and white, but Smith seems to overlook what is he is stating.  Labour is the source of wealth creation, and the direction of labour (its division) is nothing but another division of ‘labour’.

If someone is going to direct things (and be lauded and rewarded for it) then another person will have to be ‘directed’.  And whilst meritocrats attempt to come up with justifiable reasons why one person should fall into the director camp, and another into the directed one, these justifications are often specious, baseless, and intellectually weak (e.g. Marx highlights their ‘childishness’ in Chapter 26 of Capital).  However, the point stands – labour is the source of wealth, and Chinese labour, not ‘capitalism’ has lifted 850 million Chinese out of poverty.  It was, to use an expression of Marx drawn from the Bible, through the ‘sweat of their brow’.

Finally, Rajan has to consider that China has a (probable) population in 2022 of 1.3 billion.  It is about to be surpassed by India (by 2025).  Taking 0.85 billion (850 million) from 1.3 billion leaves 4.5 billion.  In other words, what about the other 450 million people in China?  Have they not been lifted out of poverty, and if not ‘why not?’

The Failure of Capitalism (Round 2)

What the ‘failure of capitalism’ means has very different connotations and implications for different speakers. For Thunberg it is a ‘system’ leading to global disaster, but for Mr Pension or Ms Moneybags (of the City), the ‘failure of capitalism’ means a failure to earn, specifically a ‘return’ on their funds, and thereby to receive an income.  The failure of capitalism occurs when capital fails to ‘earn’ a return – to make a profit.  Given that profits (properly, surplus value) are not a singular fund which can be neatly and fairly divided, the concept of multiple, competing ‘capitals’ comes to the fore.  When profits decline, capitals are set at one another’s throats, whether at a national, group (corporation) or individual level.  Even in 1767, Sir James Steuart realised that profits can be earned ‘relatively’ (one person gets richer at another’s expense).

One important developmental element of capitalist societies in the 20th century was to keep the wider system ticking over by ensuring there are sufficient numbers of ideologically supportive individual ‘capitals’ – a loyalty purchased through effective rewarding for their efforts.  Mass capitalism has witnessed the broad accumulation of individual pensioners, pension schemes, homeowners, independent investors as sources of larger and larger investment funds.  But the accumulation crises of the 20th century also highlighted how things break down when profitability declines – there isn’t enough to meet every claim on, and expectation, about the ownership of capital.

At this moment in time, it might not seem as if there is a ‘profitability’ crisis when large oil companies are earning super-profits due to the Russia-on-Ukraine War and subsequent embargoes (there are calls for governments to impose windfall taxes so ‘all’ can benefit from this ‘windfall’ – a private benefit seen as a positive externality or outcome which is not due in any way to the actions of the oil companies).  But, such super-profits in on location (on type of capital investment) simply doesn’t make up for the losses in profitability elsewhere – in short, living by profit (and especially in small business) appears impossible.  Many businesses are folding left, right and centre due to rapidly rising energy and fuel costs.

The response of capitalism to such crises has pretty much always been the same – laying workers off, and increasing ‘productivity’ amongst those remaining in work (automation for Ford’s era, and ‘artificial intelligence’ in ours).  But such increases in productivity have meant rising consumption of organic materials, namely, fuels. 

In short, Thunberg’s failure of capitalism (the impending doom of continuing to use fossil fuels) turns out to be the exact same failure as that of Mr Pension and Ms Moneybags – their ‘failing’ leads to pressure to extend the use of ‘machinery’ in replacing animate power (labour) with inanimate power (natural resources).  The claim has always been that this ‘trade off’ produces wealth (commonwealth) since use of labour would never have produced the ‘standard of living’ we ‘enjoy’ today.  But no such universal benefit has ever existed – after 250 years of capitalism (‘commercial society’) many workers and their entire families are no more than one pay cheque away from using the ‘food bank’ (charity) to exist.

Therein lies Thunberg’s ‘failure of capitalism’ and Rajan’s need to refer to ‘China’ to defend the capitalist system.