Tag Archives: economics

Screw the gift economy, a reply to Clay Shirky

PhotosI came across a post today by Gaby Dunn called “Get rich or die vlogging: The sad economics of internet fame.” Dunn gives us YouTube and Instagram celebrities forced to live hand to mouth. It reminded me of an essay I wrote months ago, shelved and then forgot. Here’s a piece of the larger whole.

Consider this crude calculation. Let’s posit 100 people each of whom is producing 10 artifacts a year for the digital domain. (Artifacts include blog posts, fan fiction, web sites, remixes, podcasts, fan art, Pinterest pages, and so on.) We are going to assume that these creative efforts are funded by day jobs, scholarships, and parental support. With this subvention, this “gift economy” produces 1000 artifacts a year. Some of this work is rich and interesting.

The creators are rewarded for their work with acknowledgment and gratitude. The exchange is ruled by what the anthropologist Marshall Sahlins would call “generalized reciprocity.” (See his Stone Age Economics.) Gifts are given without expectation of immediate or exact return. There is lots of cultural meaning here but no real economic value.

Let’s release economic value into the system. Now, the best work costs. We pay for ownership or for access. We could even use a “tipping” system. When we admire a piece of fan art, we tip the creator. This tip could come out of the $5 our ISP returns to us from our subscription fee. Or it could be supplied to us by Google which has been the overwhelming beneficiary of the content we have put online. A postmodern PayPal springs up to make this distribution system easy.

Thirty of our 100 kids are now accumulating value. The best of them are accumulating quite a lot of value. Let’s suppose that a piece of fan art, drafting on the success of a hit TV show, goes viral. Let’s say it’s viewed by an audience of 100,000 people, twenty percent of whom tip 40 cents on average. The result, eight thousand dollars, is not a prince’s ransom. (I would check these numbers. An anthropologist with a calculator is a dangerous thing.) And if it is used to allow someone to move out of their parent’s basement, it has no obvious cultural effect.

But if our winner uses the money to take the summer off from her job at McDonald’s, this is a difference from which real differences can spring. Now a good artist can become a more productive artist and eventually a better artist. And a virtuous cycle is set in train. More and better work brings in more income, more income becomes more time free for work, and this leads to more improvements in art and income. Eventually, the McDonald’s job can be given up altogether.

In this scenario, the gift economy loses…but culture wins. The supply of good work increases. Standards rise. Good artists get better.

I expect this vista will make Clay Shirky’s eyes water and possibly tear. (My text is Shirky’s Cognitive Surplus: Creativity and Generosity in a Connected Age.) He might well feel this is a brutal intrusion of capital into a magical world of generosity.

Not so fast. In point of fact, the internet as a gift economy is an illusion. This domain is not funding itself. It is smuggling in the resources that sustain it, and to the extent that Shirky’s account helps conceal this market economy, he’s a smuggler too. This world cannot sustain itself without subventions. And to this extent it’s a lie.

Shirky insists that generalized reciprocity is the preferred modality. But is it?

[In the world of fan fic, there] is a “two worlds” view of creative acts. The world of money, where [established author, J.K.] Rowling lives, is the one where creators are paid for their work. Fan fiction authors by definition do not inhabit this world, and more important, they rarely aspire to inhabit it. Instead, they often choose to work in the world of affection, where the goal is to be recognized by others for doing something creative within a particular fictional universe. (p. 92)

Good and all, but, again, not quite of this world. A very bad situation, one that punishes creators and our culture, is held up as somehow exemplary. But of course reputation economies spring up, but we don’t have to choose. We can have both market and reputation economies. But it’s wrong surely, to make the latter a substitute for the former.

Shirky appears to be persuaded that it’s “ok” for creators to create without material reward. But I think it’s probably true that they are making the best of a bad situation. Recently, I was doing an interview with a young respondent. We were talking about her blog, a wonderful combination of imagination and mischief. I asked her if she was paid for this work and she said she was not. “Do you think you should be paid?” I asked.

She looked at me for a second to make sure I was serious about the question, thought for a moment and then, in a low voice and in a measured somewhat insistent way, said, “Yes, I think I should be paid.” There was something about her tone of voice that said, “Payment is what is supposed to happen when you do work as good as mine.”

One data point hardly represents proof of my position. But it does suggest what might happen when the possibility of payment enters the world. A light goes on. The present internet is so much a gift economy and so little a market one, that it is hard for its occupants to imagine alternatives.

I am not going to take up the intrinsic — extensive distinction that matters here. Clearly, people are now being “paid” in intrinsic satisfactions. They are making great work online for the sake of doing so. But I believe it’s true that here too the intrinsic was never meant to be a substitute for the extrinsic. The luckiest people in the world get paid twice, with intrinsic satisfaction and extrinsic value. That’s actually what we’re hoping for. This is, mark you, the way the academic world mostly works. Surely, it’s wrong and a little odd to celebrate the intrinsic as an alternative to the extrinsic.

But let’s get to the very large elephant in the room. It is the career satisfactions of the so-called Millennial generation. This group has suffered diminished career options. They have been obliged to work as interns, always with the promise that this would prepare them the “real job” to come. But of course the “real job” often never comes. The obligation to work for free online reproduces the obligation of working for free in the world, as if life were one long internship, unbroken and unpaid. After a while it begins to look like one’s lot in life. My research reveals a culture of compliance in which members of this generation agree to agree that their present circumstances are not outrageous. Millennial optimism and good humor endures. (Let’s imagine if someone had tried to pull this on Gen X. Oh, wait, someone did. The reaction was an “alternative” culture and a ferocious repudiation of the status quo.)

But back to our academic contemplation of the gift economy. When Shirky says that work given “freely” on line is a great act of generosity, I think we’re entitled to say that generosity is only properly so-called when there are alternatives. And there aren’t. Forced generosity isn’t generosity.

Still more troubling, the gift economy has a second guilty secret. People can only participate if they have access to resources from outside the digital world. In fact, the moral economy excludes people who do not have wealthy parents, generous scholarships, or rewarding day jobs. If someone is poor, uneducated, and or underemployed, it is hard to participate. So much for generosity and connectivity.

Because the “generosity” view is an idealistic view, it feels somehow above reproach. Clearly for Shirky it is manifestly good. But when people are driven by generosity and rewarded with community, something goes missing. Good artists are denied the resources that would make them better. A generation continues to go underemployed. The next evolutionary moment is lost. A series of social and cultural innovations are not forthcoming. The real generative engine of our culture falls silent.

Some will object that there is an economy online even if financial capital does not circulate. They will say that people are paid in reputation, acknowledgement and thanks. Well, yes. But mostly no. The trouble with “acknowledgement” and “thanks” is that they are both mushy and illiquid. They are impossible to calculate. They cannot be exchanged for anything outside the moral economy. Acknowledgment and thanks are not worth nothing. But they verge on the gratuitous. We can “like” something with nothing more than the energy it takes to move the cursor and click the mouse. This is not quite the same as surrendering a scarce value for which sacrifices have been made. Choice, made carefully, at cost, in hope of gain and at peril of loss, this is the fundamental act of economics. Without it, all we have are bubbles of approbation. Our moral economy isn’t an economy, except in a disappointingly slack metaphorical sense.

Finally, I do not mean to be unpleasant or to indulge ad hominem attack, but I think there is something troubling about a man supported by academic salary, book sales, and speaking engagements telling Millennials how very fine it is that they occupy a gift economy which pays them, usually, nothing at all. I don’t say that Shirky has championed this inequity. But I don’t think it’s wrong to ask him to acknowledge it and to grapple with its implications.

The gift economy of the digital world is a mirage. It looks like a world of plenty. It is said to be a world of generosity. But on finer examination we discover results that are uneven and stunted. Worse, we discover a world where the good work goes without reward. The more gifted producers are denied the resources that would make them still better producers and our culture richer still.

What would people, mostly Millennials, do with small amounts of capital? What enterprises, what innovations would arise? How much culture would be created? I leave for another post the question of how we could install a market economy (or a tipping system) online. And I have to say I find it a little strange we don’t have one already. Surely the next (or the present) Jack Dorsey could invent this system. Surely some brands could treat this as a chance to endear themselves to content creators. Surely, there is an opportunity for Google. If it wants to save itself from the “big business” status now approaching like a freight train, the choice is clear. Create a system that allows us to reward the extraordinary efforts of people now producing some of the best artifacts in contemporary culture.

Bosco and the memory of William Drenttel


A couple of days ago, I wrote about Bosco, the 8 year-old who knows all about meth labs and not a lot else.

I got precisely one response, a woman who said this was kind of problem she likes to solve.  And that was it.

I thought, “maybe if I develop the idea a little.”  My first idea was a kind of twinning project.  You know, the kind that cities have. ( New York is a sister city to Cairo.)

We would identify 6 kids across the US who would then become Bosco’s twins.  And we find away to capture what they are learning as they are learning it and we find some way to communicate this knowledge to Bosco.

Our objective is to make him cosmopolitan in the ways that they are cosmopolitan.  (And by “cosmopolitan,” I mean merely, “knowledgeable about the world outside one’s own.”)  My assumption: that there are many disadvantages to growing up in the home in which Bosco finds himself but one of the most debilitating  is a lack of knowledge/understanding/awareness.  (Call it “cultural capital.“) This lack of knowledge is, we could argue, more damaging than illiteracy or innumeracy.

Problem 1.  There is a “barrier to entry” problem here.  As meth cookers, there’s a good chance that Bosco’s parents have limited horizons (prima facie case, no?) and that they would not welcome the intrusion of a system that is designed to broaden the horizons of their son.

I don’t how to solve this problem.  I have a feeling that an anthropologist and an economist working together, with the levers of meaning and value, could come up with a solution, but more on this later.

Problem 2.  There is no question that this twinning process, if it worked, would transform Bosco and there’s not much doubt that it would estrange Bosco from his family.  This would make Bosco the captive of a hostile environment.  From the parental point of view, we have created a “little Lord Fountleroy,” someone who thinks himself (or is thought to think himself) better than his family.

I don’t know how to solve this problem either.  It’s worth pointing out that every immigrant and upwardly mobile family find themselves with kids who  are more cosmopolitan than their parents.  And these parents find a way to deal with it.

Mind you, these people have sought the condition they endure.  Our “meth” mom and dad accomplish that magical contradiction that allows them to refuse the idea that they are not cosmopolitan even as they resent those who are.

How do we reach them?  What do we say?  Could we construct a forgivable space, a status allowance, for Bosco in the home,  one that allows his parents to say, “Oh, don’t listen to him.  He’s our little Martian.  Always talking about the craziest stuff!”  (Yes, but of course, we could hope for something more than this but I think it’s wise ((and not particularly hostile)) to assume the worst.  We are not looking for perfection.  We just want an allowance.)

The trick is making it “our little Martian.”  We need to construct a status for Bosco in the home that gives him room to take on and give off cosmopolitan knowledge.  And this will depend on constructing a status that allows his parents to forgive, and perhaps even take credit for, their oddball son.

At this point, I need to address a tide of unhappiness that I know is rising in anthropological readers (and some others).  People will complain that I am “essentializing” Bosco’s parents and Bosco himself, that I am imputing characteristics in an act of class stereotyping and status diminishment, that this is an exercise of power.

Allow me to do an anthropology of the anthropologists (and engage in another act of classification).  Anthropologists are almost silent when it comes to the big problems of our day and that is because the field is largely preoccupied by acts of self criticism.   Hand to brow, with a show of their sensitivity, they ask, “Can we generalize?  What are the politics of generalizing?  What are the ethics of generalizing?” These are real questions.  But Anthropology is now effectively an amateur theatre company dedicated to a production of moral posturing and ethical declamation.

I am not saying these cautions do not matter.  They do.  But when they are the only thing you do, when they are the thing you do instead of helping a kid like Bosco, when they are the thing you do that prevents you from helping a kid like Bosco, I say this.  Bite me.  Get over yourself.  Snap out of it.  Start again.  Your trepidations matter less than Bosco’s future.  While you posture, pain and suffering flourish like the green bay tree.

Whew!  Sorry.  Anthropologists have to stop being too good for the world.   It’s the only way they can return to usefulness.

One way to address Problem 2 is to catalogue all the instances of families in which children are marked as different, where parents are called upon to explain and, we hope, make allowances.  Families with autistic kids, for instance, sometimes resort to calling them “little professors.”  There are other precedents.  What are they?  Are any of them usable here?  How would we adapt these?

Let’s say we solve Problems 1 and 2.  Let’s say we find a way to create a twinning system and relay information from Bosco’s twins to Bosco himself.  How would we do this?

This is where I thought of William Drenttel.  I gave a paper at Yale a couple of years ago and afterward he and I had a roaring, gliding conversation.  It was clear he was trying to recruit me for one of his grand schemes and to my discredit I failed to rise to the occasion.  (I was working on schemes of my own, which I now see were minor and ordinary by comparison.)

When I thought about how to get information, knowledge and understanding to Bosco, I thought of Bill.  He is one of those designers who strike me as the anti-anthropologist: citizens of several worlds, effortlessly mobile in passage between them.  Bill, I thought, would know how to think about this problem.  This is a design thinking problem because we are, in effect, being asked to design thinking.  

If we could find some way to represent the knowledge being accumulated by Bosco’s twins, this might help.   Let’s say Twin 1, the one in Philadelphia, is sitting with his family watching TV.  There’s a news story about LA and the family conversation that follows somehow puts LA on Twin 1’s “mattering map.”  (I have this term from Rebecca Goldstein).

The trick now is to make LA matter on Bosco’s mattering map.  The fact that we are talking about geographical knowledge helps a lot.  A map is itself a useful, perhaps the original, visualization.  But our job is to show how “LA” matters not just for its relative location (Bosco lives somewhere in the midwest) but also as the home to Hollywood,  dinosaur-rich tar pits, several sporting franchises, and a particular place in the American imaginary.  (We will have to fit that last one with new language.)  Our question: What does Bosco already know and how do we use this to help him grasp facts and fancies about LA.

Bill, I thought, will know how to take this problem on.  And today I discovered that William Drenttel passed away in December of last year.  (See this remarkable obituary by Julie Lasky.)  I think an honest, hard-earned  moment of self repudiation is called for here.  Why wasn’t I in touch with him?  Why didn’t I know about his illness or his passing?  Is there some good reason why I live like a small forest animal, posting out of a tree stump and otherwise out of touch with the world?  What is my excuse exactly?  And who am I kidding?  (Forgive a maudlin outburst.)

My thought originally was to make designers and anthropologists the intermediaries of the movement of knowledge between Bosco and his twins.  But in a more perfect world, and now with social media at our disposal, it might be possible to make Bosco and his twins a tiny community (Marshall Sahlins’s “mutuality of being“) that pools its knowledge and helps one another master it.  Can eight year-olds do this kind of thing?  I don’t know.  Maybe with some training.

Happy coincidence but this morning I saw a tweet by Sara Winge on the attempt by UNICEF to use Minecraft to show what a reconstructed Haiti might look like.


Could a band of eight year-olds build a model of their knowledge?  In Minecraft or some other medium?  Jerry Michalski has put some of his knowledge online.   Some 160,000 “thoughts” all  in categories and ready to hand.   Bosco and his friends might do the same with the right education and encouragement.

There is lots of work to do here.  Who’s interested?  If we get something up and running, I propose we call it the Drenttel project.  No, there are so many Drenttel projects running in the world, that would be wrong and clueless.  Let’s call it A Drenttel Project.


Thanks to Kevin Smith, William Drenttel and Architect’s Newspaper here for the image of Bill above.

Will Digital Culture ever invent a Homer Simpson?

First Observation:

Entertainment Weekly recently gave us the "100 greatest characters of the last 20 years."  The list includes Buffy, Jack Sparrow, Rachel from Friends, Harry Potter, John Locke, Miranda Priestly, and Ron Burgundy.   

Second Observation:

In his latest book, Clay Shirky suggests that we now have around 1 trillion hours of creative surplus at our disposal.  We use this time variously, offering Lolcats and, yes, blog posts.

The question:

Will Shirky’s surplus ever create a character that will appear on the Entertainment Weekly list?  Will we ever create our own Homer?

Some thoughts:

I am not being argumentative.  This is an open question. The answer could be "soon" or it could be "never," and I’ll be happy.  However we answer this question, we will have improved our anthropological understanding of contemporary culture.

There is a general presumption, I think, that we are sitting on a gusher.  Shirky’s surplus is so vast, so inexorable that the creation of an EW "100 winner" can’t be far off.  And it’s not that we are talking about the proverbial 100 monkeys.  It won’t happen by evolutionary accident.  It will happen because our use of the Shirky surplus gets better and better. This argument says "soon."

Some will say our surplus is already in evidence on the EW list.  They will say that these creatures are the result of user participation, consumer cocreation, the agency and activity of fans, transmedia assembly, textual poaching, and a liberal borrowing from the cultural commons. Homer Simpson is all about borrowing and, like any bard, his standing depends finally on our consent. This argument says "already."

But there is an argument that says "never."  The red neck version of the argument rehearses the idea that popular culture is a waste land.  Thus speak Keen and Bauerlein. But there’s a more sophisticated approach that says the creativity of the internet is a derivative creativity, that mashup culture must begin with something first to mash.  Our culture may be in the direction of the consumer-producer but it will always depend on the producer-producer as a kind of "first mover." 

Let’s push things a little further.  (And again I do this for the sake of argument only.  Living at the intersection of Anthropology and Economics, I can be ecumenical on a question like this.) What if the people who make Homers and Buffys must be funded by something other than the "creative surplus."  Must there be an enterprise that engages people to invest financial and creative capitals in a (relatively) expensive and therefore risky productions which then compete in some cultural marketplace.  

By this reckoning, the EW 100 list will not exist without the intervention of commerce (of some pretty literal kind that goes well beyond the gift economies of the cultural commons.)  

I’m just asking.  

The Upshot:

This would make a dandy topic for a Futures of Entertainment session, with Shirky, Henry Jenkins, Larry Lessig, David Weinberger, Dan Snierson, Jeff Jensen, and several other thinkers.  With Sam Ford moderating, of course.


Anonymous.  n.d.  "Lolcats" entry on Wikipedia here.

Bauerlein, Mark.  2009.  The Dumbest Generation: How the digital age stupefies young Americans and jeopardizes our future.  Tarcher.  

Carey, John.  1992.  The Intellectuals and the masses: pride and prejudice among the literary intelligentsia, 1880-1939.  Faber and Faber.  (For an argument that anticipates and, I believe, dispatches the kind of argument made by Bauerlein and Keen)

Jenkins, Henry.2006. Fans, Bloggers, and Gamers: Media Consumers in a Digital Age. NYU.

Jenkins, Henry. 2008. Convergence Culture: Where Old and New Media Collide.  NYU 

Keen, Andrew.  2008.  The Culture of the Amateur: how blogs, MySpace, YouTube, and the rest of today’s user-generated media are destroying our economy, our culture, and our values.  Broadway Business.  

Shirky, Clay. 2010. Cognitive Surplus: Creativity and Generosity in a Connected Age. Penguin Press. 

Snierson, Dan, Jeff Jensen, and many others.  2010. The 100 Greatest Characters of the last 20 years. Entertainment Weekly.  Double Issue.  No. 1105 and 1106.  June 4 and June 11.  here.


Thanks to Gareth Kay for telling me about Shirky’s new book.  

Rusting Buicks and the destruction of wealth

[This little essay was originally posted February 26, 2010 and then was lost when Network Solutions was attacked by malware and "misplaced" my database.  I wanted to get it back in circulation.  Apologies to those who have seen it before. Special apologies to those who left comments on the original post.  There were some beauties.  Thank you, Network Solutions for being entirely uncooperative, unreliable, and unrepentant.]

Picture yourself in the hinterland of British Columbia.

You are many hundreds of miles from Vancouver.  

You are in the middle of nowhere on a stretch of road so desolate it feels like something out of an X-Files episode. (Cue the X-Files orchestra for that eerie theme music.)

There’s a mining camp at one end of the road and a mining camp at the other.  Most everyone here get an hourly wage. And the wage is generous.  (These rough necks are paid like princes.  Who would come to this god forsaken place otherwise?)  And because there is nothing much to do here, the roughnecks work extra hours, most days and even Sundays.  Add "time and a half" and "double time," and it’s not long before these people are worth a bundle. 

Periodically, they head for town.  For most the destination is Vancouver, many hundreds of miles away.  Guys, they are mostly guys, will hitchhike for a while. And they take buses when they must, and eventually they say, "F*ck it, I’m buying a car."  And they do.  They buy a Buick with all the trimmings.  And away they go.

The trouble is, the guys have been drinking since they left camp and by this time they are often blind drunk, and so, well, it’s not uncommon to come off the road and wrap the Buick around a tree.

And here’s the weird part.  The guys don’t get the Buick fixed.  They just keep going. What they have done to the Buick captures what they do for the remainder of this trip to Vancouver and for the duration of their stay there.  Make a hash of things.

The "skid row" in Vancouver is there to greet them.  The card sharks, hookers, and bars are seasoned tourist professionals, skilled at various kinds of value transfer.  It will take a couple of weeks.   But eventually our guys will wake up in a gutter without a dime.  

And here’s the other weird part.  They will brush themselves off, and go back to the hinterland.  Some will do this many times over several decades.  Which is way there are so many rusting cars on the roads of the interior of BC.  

From an conventional point of view this is deeply irrational behavior.  Why endure the privations of life in the bush, and the exertion and the danger of this kind of labor, unless you are going to keep some part of what you earn? Surely, the point of coming here is to earn your way out.  Not to spend your way back in.  But the hinterland is a prison to which inmates keep returning by choice.  In a sensible world, people would come here just long enough to make enough to buy the motel, dry cleaning store, or bowling alley that will release them from wage labor forever.  But no, they take their stake and they squander it. These guys seem bent on destroying wealth.  

Which brings us to Pirates.  I know you were waiting for the Pirate passage.  I’m reading a nice little book called And a Bottle of Rum by Wayne Curtis.  Here’s a passage.

After his raids, Captain Morgan and his men would sail to Port Royal to whore and drink and spend their money.  The more carelessly they could rid themselves of their gold, the happier they were.  "Wine and Women drained their Wealth to such a Degree that in a little time some of them became reduced to Beggary," reported pirate chronicler Charles Leslie.  "They have been known to spend 2 or 3000 Pieces of Eight in one Night…"  Morgan "found many of his chief officers and soldiers reduced to their former state of indigence through their immoderate vices and debauchery."  Then they would pester him to get up a new fleet for further raids, "thereby to get something to expend anew in wine and strumpets."  (location circa 664 in the Kindle version of this book)

Which brings us back to British Columbia, and an aboriginal practice called "potlatch" when rival communities would take turns dumping Hudson Bay blankets and other valuables into the Pacific ocean.  One of the explanation for this practice is that it is undertaken as a very deliberate act of wealth destruction. ( I don’t know the literature here as well as I should so I am penciling these data in provisionally.)

This destruction of wealth is a wonderful thing.  Wealth for miners, pirates, and perhaps aboriginals is charged with potentiality.  To keep this wealth is to do its bidding.  Once you’ve made a small fortune in a logging camp, some convention says, you must leave the hinterland, pay that motel, and "start a new life."  Which these loggers and miners devoutly do not wish to do.  Hence those trips to town.  These loggers are fighting demon wealth.  

Our loggers, miners, pirates (and aboriginals?) are defending their way of life.  They are destroying the money that threatens it.  They can see the potentiality of all this wealth, they can feel the cultural instructions embedded in it, and they are damned if they will give in it.  Better, easier, truer to their life missions, to piss this money away.

Actually, there is nothing irrational about this behavior.  It has a job to do and it does well. But there is no economic model that came help us retrieve the rationality of this behavior, I don’t believe.  To do this we need to look beyond "rationality" narrowly defined, beyond "interest" and "benefit" as it is usually construed. We need to capture the culture that supplies the meanings that shapes the lives that demands the destruction of wealth the results in all those rusted Buicks.  There’s a method to the madness.  In fact, it isn’t madness.  

Indeed, under carefully scrutiny a lot of economic behavior, even the b to b variation thereof, is not fully rational.  But when the economists find things that do not find the paradigm, they insist these are "irrational."  Um, but surely there is a grey area in between. That economic actors are not rational doesn’t mean that are irrational.  The trouble is that the idea of rationality is so narrowly defined is to leave much of the human experience out of account.  It is true that actors are sometimes not rational but they are almost never not interested.  They are always driven by an idea, a concept, a preference, an "interest," and almost always this idea, concept, preference or interest comes from culture.

So when Adam Smith excises culture from the proposition in a sense he assumes what he means to prove.  And he leaves us with a model that can’t explain new Buicks any more than it can rusted ones.  I mean if transportation is the object of the exercise, there’s an awful lot chrome that doesn’t seem germane.  And no, we may not put the model on life support by evoking status competition and conspicuous consumption.  Nice try, Mr. Veblen but there are so many more cultural meanings besides status at issue in any give Buick that you did not so much rescue the model as cleared the way for a more thorough going assessment of its insufficiency.  

I guess this post is my way of saying there is a lot of learn from loggers, miners and pirates.  It’s just so very difficult to get them to come in for guest lectures.  

  • Posted on: Fri, Feb 26 2010 3:23 AM

The Mystery of Capitalism

I am always surprised that no one bothers to tell the story of capitalism.

No, the stories we prefer to tell our children is that capitalism is a dangerous, soulless, relentlessly exploitative exercise.  Indeed, this story is so preferred as our received wisdom that it is exceedingly rare to hear anyone recent Adam Smith’s magical insight, that good things can and do come from people pursuing their own, sometimes narrow, objectives.

The anti-capitalism view is an ideological fixture of our education systems at every level, from grade to graduate school.  We could call it orthodoxy if it were not so much like boilerplate.  It’s not so much argued as assumed.

Capitalists are sanguine.  Apparently, they don’t feel they have to tell the story of capitalism.  Somehow capitalism will teach its own lessons.  Once people escape the magic kingdom of education, the truth will dawn.  Once they have spend a little time in the marketplace, the penny will drop.  Or, as the English like to say, "if a man’s not a Marxist at 20, there’s something wrong with his heart.  But if he is still a Marxist at 30, there’s something wrong with his head."

When Peter Robinson interviewed Gary Becker, Professor at the University of Chicago and winner of the Nobel Prize, recently, the master surprised Robinson be announcing, "Markets are hard to appreciate."   Robinson asks for clarification and Becker obliges:

"People tend to impute good motives to government. And if you assume that government officials are well meaning, then you also tend to assume that government officials always act on behalf of the greater good. People understand that entrepreneurs and investors by contrast just try to make money, not act on behalf of the greater good. And they have trouble seeing how this pursuit of profits can lift the general standard of living. The idea is too counterintuitive. So we’re always up against a kind of in-built suspicion of markets. There’s always a temptation to believe that markets succeed by looting the unfortunate."

And I think this gets at some part of the heart of the problem.  Capitalism is, as Becker says, counterintuitive.  It tells a bad story.  In fact, it isn’t a story.  It is anti-storyish.

Capitalism doesn’t have heroes.  It doesn’t have people called to higher motives.  It doesn’t have noble sacrifices for the good of others.  It doesn’t, usually, have daring action on a public stage.

No, capitalism is just has some guy who owns a handful of dry cleaning outfits in a small town in New Hampshire.  He works hard, supplies a service, pays off his loans, coaches Little League, goes to church, gets his kids through college, and spends his very few disposable hours on the golf course.

Script!  Casting!  Someone call the studio!   This is appalling.  It doesn’t matter that out of these mundane activities in lots of towns big and small, played out by millions of people across the US, something remarkable will come.  This just isn’t a story anyone wants to listen to.  So no one much wants to tell it.  Not Hollywood.  Not our mythmakers.  Not our story tellers.

The economist has spoken.  It is a little clearer why we do not tell the story of capitalism.  It just doesn’t tell very well. But if the anthropologist may join in here.  Can we at least acknowledge that there is something fabulously odd about a culture that depends on capitalism but that will not ever acknowledge it in the stories it tells itself about itself.


Robinson, Peter.  2010.  Basically an Optimist–Still.  The Wall Street Journal.  March 27 -28.  p. A13.

Note: This post reposted December 23, 2010.  It was lost due to Network Solutions incompetence and only just tonight resurfaced on the net.