We have become lovers of pleasure rather than lovers of the Economy! There are those who will say that the Economy has forsaken us! Nay! You have forsaken the Economy! And now you know the Economy's wrath! O thoust can shop at a sporting goods store, but knowest thou that the Economy will take away thy Broncos' cap from thine head! Mock the Economy without fear! Thine own stockbrokers... now lie dead by their own hand and thou knowest that thy stockbrokers did not fear the Economy! Well here we are, my friends! You have brought the Economy's vengeance upon yourselves! … We must all wear sheets instead of buying clothes that need detergent! Instead of cars that take gasoline we can get around on llamas from Drake's farm! Instead of video games that take batteries and software, our kids will play with squirrels! We must let the Economy know that we are capable of respecting it! No more needless spending! The Economy is our shepherd. We shall not want.Modern society, whose elites pride themselves on their rationality, has made ‘the economy’ into a god. Not an ever-kind and smiling one, mind you: this one puts the Greek gods to shame in its fickleness. Economists, who are its priests, cannot predict its actions; governments cannot tame it; its victims must bear its wrath cheerfully as the vengeance of a power beyond comprehension. And yet ‘the economy’ is fundamentally a set of relationships between human beings: it is man-made. Where does this mystification come from?
According to Nicos Poulantzas, the concept of the ‘free labourer’, who owns nothing but his labour power,
generates the relative separation of the State and the economic sphere… a separation which underlies the characteristic institutional framework of the capitalist State, since it maps out the new spaces and respective fields of the State and the economy. This separation of the State and the space of the reproduction of capital is therefore specific to capitalism: it must not be understood as a particular effect of essentially autonomous instances composed of elements that remain constant whatever the mode of production. (State, Power, Socialism, p. 18.)In feudal society, by contrast, producers owned (that is, lived on and tilled) the land and the tools, so extracting their product involved the direct application of legitimate state violence; and the guy who took away your produce was quite obviously the same person that ruled you politically. I want to suggest, however, that there is a different approach to the question of why ‘the economy’ appears as a thing capable of action in capitalism. The explanation, I think, lies in capitalism’s capacity to produce periodic crises.
We tend to accept as given that economic crises happen; despite the protestations of bankers and politicians, everyone knows that the next crisis is certain. In that environment, it is difficult to remember that internal crisis was simply unknown in feudal society. Since commodity production was only a tiny proportion of overall economic activity, there could be no crisis of overproduction; since finance in the modern sense hardly existed and was only employed by a narrow sector of society, financial crises were also impossible. Crises of confidence could not occur where economic activity was not based on investment and information travelled very slowly, preventing panic. The feudal economy’s need for natural resources was insignificant compared to the enormous appetite of today’s productive sector, and hence no supply crises could occur. Thus internal systemic crisis was impossible as long as capitalism as a mode of production was restricted to a small part of the urban population. The feudal economy was not based on explosive growth, but could exist in equilibrium.
Not, of course, that feudal society was incapable of crisis per se. External crisis not only existed, but could have harrowing consequences. Droughts, floods, excessively cold winters and other natural disasters easily led to famine. The low productive surplus feudalism generated often resulted in large loss of life in such crises. External crises could profoundly affect social relations, of course. The Black Death of the mid-fourteenth century killed so many English peasants that the position of the remaining peasants vis-à-vis the nobility was immediately strengthened by the shortage of labour power. King Edward III cracked down in 1351, laying down laws to limit peasants’ gains. The Black Death led to a wave of migration to the cities and the creation of opportunities for women, as economic sectors previously monopolised by men opened up because of mass death.
Such crises have much in common with capitalist crises. Both strike suddenly, seemingly out of nowhere, and destroy livelihoods and fortunes, leading to a decline in living standards and in many cases to starvation and death (be it directly or indirectly, through ‘structural adjustment’). Both tend to lead to political polarisation and a rise in tension and. Both, in short, rapidly destroy the lives their stunned victims were accustomed to and create a new, much more unpleasant reality. But of course there is a key difference between the two. The sort of crisis that could ravage medieval society was caused by acts of God. Capitalist crisis is man-made: indeed natural disasters tend to create wonderful opportunities for capitalists rather than impoverish them. The former sort of crisis was caused by the mode of production’s vulnerability to external events; the latter kind is inherent in the mode of production itself.
That difference, it seems to me, neatly explains how ‘the economy’ became a sphere of life quite distinct from others – politics and everyday life. The inexplicable natural disasters that befell medieval society were attributed to God; but since, at least officially, economic life is man-made and God has no hand in it, he cannot be held responsible. The system can inflict punishment all by itself. Thus begins ‘the economy’s’ reign of terror as it smites its terrified victims. We must propitiate the economy and treat it well, or expect awesome vengeance.
Of course, in reality ‘the economy’ is an abstraction from sets of social relations, productive and commercial. Mystification, the elevation of the abstraction into a godlike being (alienation), serves dominant interests because it denies individuals’ and classes’ specific roles and responsibilities. Blame the bankers? Not if Bob Diamond has anything to do with it. Failure is an orphan, and when crisis strikes it can only be ‘the economy’ that somehow malfunctioned. Economic crises become as natural as the seasons rather than being, as they should be, associated with a particular form of society – one that can be overcome.
The non-existence of ‘the economy’ in pre-modern society also points us to what will happen to this strange god if an alternative form of life is attempted. For, as people begin to take control of their own lives, as the profit motive is removed, production is for use rather than profit and crisis disappears, ‘the economy’ will lose its dreadful power and, like all false gods, will wither away.