Stay on Target

What follows is a heavily rewritten excerpt from a letter to the Editor-in-Chief of the John Jay Sentinel, a student newspaper at the John Jay College of Criminal Justice. In its original form the letter was published in the March 2011 and April 2011 issues of the Sentinel. The editor had correctly pointed out that economic competition under capitalism encouraged the development of technology, and he asked me whether it would therefore be worthwhile to spend time and effort on eliminating capitalism. Here is my answer:

Those of us who believe that the technological system is an evil are often tempted to attack some of the subordinate evils that are associated with it, such as capitalism, globalization, centralization, bureaucracy, big, intrusive governments, environmental recklessness, and gross economic inequality. This temptation should be resisted. One may, of course, use evils like those I’ve listed as tools to attack the technological system by pointing out that similar evils inevitably accompany any such system. But it is inadvisable to attack any of the subordinate evils independently of an attack on the technological system as a whole.

What makes the subordinate evils tempting targets for attack is that there already are substantial numbers of people who strongly resent them and could be rallied to resist them; and if any of these evils could be eliminated, the growth of the technological system would be retarded and its negative consequences somewhat mitigated. Capitalism, for instance, is at present the economic system that is most conducive to technological development, so if you could get rid of capitalism you would to some extent slow technological progress; in addition, you would reduce economic inequality. Globalization contributes to economic and technological efficiency because there are obvious advantages to a system in which natural, human, and technical resources can be freely transferred from any one part of the world to any other part where they may be needed. So if you could do away with globalization and isolate each region of the world economically from all the others, technological progress would be significantly slowed. Centralization too is important to technological progress. For example, in order to keep the U.S. economy functioning properly there has to be some central authority to regulate banking, print money, and so forth, otherwise the U.S. would experience the same difficulties as did Germany prior to its unification, when much of the country was still divided into numerous small, independent states, each with its own banking regulations, its own currency, its own weights and measures, etc.[1]

As many petty states as there were, ... so many were the different civil and criminal codes, so many the different kinds of coins and banknotes, so many the different military, financial, and transportation-related institutions. ...The citizen of Wiirttemberg needed a passport to travel to Baden. For a stay in Koburg-Gotha, Braunschweig, or Schwarzburg-Rudolstadt, the citizen of Baden needed to exchange his money.[2]

For normal economic development, the financial and commercial regulation of Germany had to undergo a centralizing process that spanned most of the 19th century.[3] If centralization could somehow be reversed in Germany—or in the U.S. or any other country—economic growth and technological progress there would be significantly impeded.

So why not attack centralization? First, it would be exceedingly difficult to attack centralization successfully. An organization or a movement would have to concentrate all its energy on that attack, and even if it succeeded in substantially reducing centralization the result would be only to slow technological progress to a certain extent; neither the technological system nor the principal evils associated with it would be eliminated. Thus, in attacking centralization the movement would use its resources inefficiently: It would expend vast energy in the hope of only a modest gain.

Worse still, by concentrating its energy on the campaign against centralization, the movement would distract attention (its own and other people’s) from the most important target, which is the technological system itself.

In any case, an attack on centralization could not be successful. Of course, there is no special difficulty about decentralizing in situations where centralization has proven to be economically inefficient. E.g., excessive centralized control over economic activity, otherwise known as socialism, has largely died out due to its inefficiency. But where centralization promotes efficiency, its prevalence is guaranteed by a process of natural selection.[4] Systems that are more centralized (in aspects in which centralization contributes to efficiency) thrive better than those systems that are less centralized; hence, the former tend to expand at the expense of the latter. Since inefficiency imposes economic and other hardships on people, most will oppose decentralization. Even the majority of those who now hold a negative view of centralization would oppose decentralization when they found out what it cost them in terms of efficiency. For example, if you wanted to let each state of the Union establish its own monetary policy and print its own currency independently of all the other states, your proposal would be dismissed as ridiculous. Even if you somehow succeeded in putting such a measure into effect, the negative consequences—monetary chaos and so forth—would outrage so many people that centralized control in monetary matters would soon be reinstated.

Needless to say, if future developments should ever make centralized systems economically and technologically inefficient in comparison with less centralized ones, then it will be relatively easy to decentralize. But in that event your attack on centralization will be promoting technological progress rather than retarding it. In either case, attacking centralization is not an effective way of resisting technological progress.

Arguments very similar to the foregoing apply to any effort to eliminate capitalism. To have any hope of eliminating capitalism a movement would have to concentrate all its energy on that task, and even if it succeeded in eliminating capitalism the gain would be very modest, because technological progress would continue, though at a somewhat slower rate. There was no capitalism in the Soviet Union, for example, yet that country was by no means a negligible force technologically. Even before World War II the Soviets were among the leaders in nuclear physics;[5] their MiG 15 jet fighter shocked Western forces in the Korean War with its speed and agility;[6] the Soviets were the first to develop a really successful jet airliner, the Tu-104;[7] and the Soviet Union was the first nation to put an artificial satellite into orbit.[8]

Thus, an antitechnological movement that focused on the elimination of capitalism would gain little in return for an enormous expenditure of energy. What is worse, by focusing on capitalism the movement would distract its own and other people’s attention from the far more important objective of bringing down the technological system itself.

An attack on capitalism moreover would be futile, or would be successful only temporarily and in a few countries at most. Capitalism has become the world’s dominant economic system through a process of natural selection; it has replaced other systems because under present-day conditions capitalism is economically and technologically more efficient. For this reason, even if you could get rid of capitalism in some countries, these would tend strongly to revert to capitalist economic structures as the relative inefficiency of their non-capitalist systems became apparent. This has been demonstrated through experience: When the socialist countries of Eastern Europe couldn’t keep up with the West economically or technologically, they adopted capitalist systems. Sweden once was ideologically socialist, but in practical terms socialism never got very far in that country. Today Sweden is still a capitalist welfare-state—and is becoming less of a welfare state as it reduces benefits in the interest of economic efficiency.[9] China remains nominally socialist, but for the sake of economic success the Chinese government now allows a great deal of private enterprise, i.e., capitalism.[10] In Nicaragua the Sandinistas still pretend to be socialist, but in reality they are turning to capitalism.[11] This writer knows of only two countries left in the world that are free of capitalism: Cuba and North Korea. No one wants to imitate Cuba or North Korea, because they are economic failures. And that’s why Cuba is now (2011) taking some timid steps in the direction of capitalism.[12]

So it’s clear that as long as we live in a technological world we will never get rid of capitalism unless and until it is superseded by some system that is economically and technologically more efficient.

The arguments I’ve outlined here in reference to centralization and capitalism are equally applicable to globalization, bureaucracy, big, intrusive governments, environmental recklessness, and any number of other evils the elimination of which would merely impair the efficiency of the technological system while still permitting it to grow. As long as society remains saturated with the values of the technological system, most people will not accept any measures that seriously impede the functioning of that system. In order to get people to accept such measures, you would first have to convince them that the supposed “benefits” of modern technology are not worth the price that has to be paid for them. Thus, your ideological attack must be focused on modern technology itself. An attempt to eliminate capitalism, globalization, centralization or any other subordinate evil can only distract attention from the need to eliminate the entire technological system.

[1] Dorpalen, p. 167. Zimmermann, pp. 8-9. NEB (2003), Vol. 20, “Germany,” pp. 106, 111, 113. By “unification” we mean not merely the foundation of the German Empire in 1871, but a process that arguably lasted as long as 93 years, from the changes imposed by the French conquerors in 1807 (ibid., p. 102) to the promulgation of a uniform civil code for the Empire in 1900 (Zimmermann, p. 9).

[2] Zimmermann, p.8, quoting one “Lowenthal” without any further indication of the source.

[3] See note 1, above, and Tipton (entire article). Tipton argues that historians err when they identify a particular date, e.g., 1834 (creation of the Zollverein— the customs union) or 1871 (foundation of the German Empire), as the point at which German economic development “took off”: Quantitative data show that German economic development throughout the period in question was a smoothly continuous process in which no “take-off’ points are apparent.

But in places (e.g., pp. 222-23) Tipton seems to argue that centralizing events like the creation of the Zollverein or the foundation of the Empire were unimportant for Germany’s economic development. If this is what he means, then his argument has to rest on the assumption that such events could not have been economically important unless they were signaled by an immediate change in the rate of economic growth. And that assumption is clearly unjustified. Among other things, as Tipton himself points out, the changes in economic regulation brought about by the Zollverein and the Empire were developed only over a span of decades: The Zollverein was not fully implemented until 1857 (Tipton, pp. 201, 209), while the economically relevant legislation of the Empire was enacted piecemeal and was not completed until 1897 or even perhaps 1900 (Zimmermann, p. 9; Tipton, p. 209). Moreover, realization of the economic consequences of the changes in regulation required certain developments, such as the construction of railroads (Tipton, pp. 200-01, 205), that could not occur overnight.

Thus, the absence of quantitatively identifiable “take-off’ points provides no evidence that the centralization of economic regulation was unimportant for economic growth. Tipton himself notes that “[f]ree movement of resources is important for development” (p. 198), and that “[f]actors of production will be more mobile... in an area without internal tariffs, separate monetary systems, or variations in commercial regulations” (p. 200), from which it logically follows that centralized economic regulation is important for economic development.

[4] See Chapter Two of Anti-Tech Revolution.

[5] NEB (2003), Vol. 21, “International Relations,” p. 858.

[6] Ibid., Vol. 8, “MiG,” p. 117. See also Air & Space, Oct./Nov. 2013, p. 80.

[7] Woodall, p. 4. Mellow, pp. 61, 65.

[8] NEB (2003), Vol. 19, “Exploration,” pp. 47-48.

[9] The Economist, June 11, 2011, p. 58.

[10] The private sector is the most vigorous part of China’s economy. The Economist, March 12,2011, pp. 79-80, and June 25,2011, p. 14 of Special Report (“the dynamism in China’s economy is mostly generated by non-state firms”). It’s true that massive government intervention has played an important role in building up China’s economy, but this has been only a temporary stage that is characteristic of backward countries that are straining to catch up with the fully developed industrial nations. See NEB (2003), Vol. 24, “Modernization and Industrialization,” p. 288. In all probability, government intervention in China’s economy will become less and less conducive to economic vigor as that country moves beyond the “catch-up” phase.

[11] The Economist, Aug. 27, 2011, p. 33; Nov. 5, 2011, pp. 47-48.

[12] The Week, April 29, 2011, p. 8. USA Today, May 10, 2011, p. 6A.