I have a friend who’s a rabid capitalist, but also sees value in community. For a long time I’ve had an uneasy suspicion that those two things are actually incompatible, but couldn’t articulate why. So, when I recently stumbled across a book called The Dismal Science: How Thinking Like An Economist Undermines Community by Stephen A. Marglin, I immediately bought it. It’s a slog for someone like me without any training in economics, but I got enough out of it to confirm the insidious capitalist ninja shit I always suspected.
To point at an example from the book, the Hutterite culture forbids anyone from taking out insurance. Instead, when a barn burns down, the entire community gets together, pitching in time and resources, and they build a new barn together.
Now, what would happen if the Hutterite whose barn burned down had bought fire insurance? Instead of the community rallying together, the one family affected would make an insurance claim, and the insurance company would take care of reimbursement and rebuilding the barn. Additionally, when someone else’s barn burns down, the person paying insurance may not feel the same need to assist, since they’re taking care of their own property by themselves, so they let the people participating in “communal insurance” do the barn raising on their own. Of course, this means that there are fewer people to help with the new barn. If enough people decide to opt for fire insurance, the whole tradition of barn raising disappears, because eventually there won’t be enough people participating in the “communal insurance” system to actually be able to raise a barn successfully. In this way — again, the “frog in a pot of warming water” metaphor comes to mind — insurance would slowly undermine some of the fabric of a community. And multiple instances of this kind of thing could destroy a community entirely. You could easily argue that this is exactly what has already happened to western culture.
So what? Barn raising is drudgery anyway. Surely people have things they’d rather be doing. And, anyway (as my rabid friend objected), why would you want to owe someone if they helped you put up a new barn? Wouldn’t it better to simply have a 3rd party do it? Nobody owes anybody anything that way, and nobody’s going to feel taken advantage of if their own barn never burns down.
I tend to be a very slow thinker when it comes to having debates. The pressure of having to counter someone’s argument with anything more intelligent than “Well, that’s what I read” tends to make my brain pee its pants, and for this reason I avoid arguments if at all possible; they’re always humiliating. What I mustered in this case was “Well, you could be paying someone back for a favour they previously did you,” which, of course, didn’t help my point at all. In his mind it was still someone owing someone and that was bad.
To my genuine surprise, my friend wasn’t arguing that taking out insurance had no negative effect on community. He ignored my main point, and instead argued that the best and most egalitarian approach to allocating responsibility and resources was for everyone to purchase their own fire insurance. This avoids the icky someone-owing-someone awkwardness and all the tracking and accounting (via some kind of official record) that goes along with it. While I argued for inter-reliance and shared responsibility, he saw those as a weaknesses rather than strengths. For him, capitalistic vehicles such as insurance give people self-reliance and the freedom to make their own choices, and that was better.
Obviously, that conversation did not go the way that I had hoped, and it wasn’t until much later, after mulling it over in my head for the 50th time, that the clouds parted. What I realized is that the fundamental incompatibility between capitalism and community is actually very easy to define, and it pivots around the notion of “transaction“.
An infinite flow of discrete transactions is the capitalistic way of looking at the world. Capitalism is explicitly transactional; each transaction being a supposedly equal value exchange of capital for goods or services (disregarding inconvenient externalities, of course <cough>), and all of it tracked using money and receipts. But community operates under the exact opposite pretense: the exchange of goods and services within such a system is implicitly NON-transactional. In a community, you don’t do a thing for someone because you have an expectation of a value-for-value benefit coming to you, no. In a community, you do something for someone simply because it’s the right thing to do. Doing the right thing builds trust, and trust builds bonds. Multitudes of tiny bonds between people in various ways and for various reasons builds a strongly interconnected group of people who rely on each other and can depend on each other to ensure life can be lived with a certain amount of support and protection when needed. But crucially, nobody in this kind of a system is keeping track of who did what for whom, and how much that was worth, and whether you owe them now, or they owe you. In a true community, people simply do, because it is the right thing. They believe that everyone including themselves needs help sometime, and it will all come out in the wash eventually.
Barn raisings are a crucial part of Hutterite culture. What capitalism and my rabid friend fail to grasp, is that a barn raising is much, much more than the toil and expense of raising a barn. It’s a communal event. In much the same way that weddings and funerals serve as periodic bonding rituals for families, barn raisings bring an entire community back together for a few days to talk, work, make meals and eat together, play music, sing, make new friends, and fall in love. I challenge you to point to a time when the submission of a insurance claim created benefits like that.
It’s also important to understand that this communal system doesn’t work on the principle of “you raise my barn, I’ll raise yours.” Again, that’s transactional thinking. No, the weaving of connection, inter-reliance, and inter-dependence occurs in hundreds of little ways every day, and just because someone doesn’t participate in a barn-raising doesn’t mean they haven’t contributed in some significant way to the lives of others in the community that has enabled those people to participate. Someone assists your child learning how to tie their shoe, someone shovels someone else’s walkway, someone drives someone to the doctor, loans a tool, assists with yardwork, or sits for days at a person’s death bed. All of this, not for payment for some past or future favour, but just because contributing to the community in any way at all is right and good, and leads naturally to connection and support. The exchange of dollars for services cannot create that, as much as our transactionally-obsessed system wants to trick us into believing that it can.
The transactional nature of capitalism strips away all of the important squishy stuff that actually makes life worth living and robs us of opportunities to truly connect with one another in deep and lasting ways. It works against our natural instincts and needs by fragmenting us rather than making us look to each other for support. An economist sees interdependence as difficult to quantify, and the web of generated intangibles too incomprehensible to account for effectively. So these beneficial side-effects are simply lumped under the umbrella of “externalities”, conveniently ignored, rendered valueless, and factored out of their equations. In fact working together and helping each other, without the expectation of tit-for-tat compensation is how we have managed to survive up to the modern era. Our larger culture is too short-sighted and stupid to see that now — what with quarterly earnings and an obsession with GDP superseding all other concerns –, and appears to be past the point of no return. However, Hutterites, in their wisdom, saw where the adoption of insurance would lead. And, rather than shrug their shoulders and let the industry surreptitiously shred the precious sense of community that binds them, they banned it outright. To that I say huzzah!