Thursday, July 9, 2015

The Question of Neo-feudalism

If you go to Wikipedia's entry on neo-feudalism, you get the center-left ruling class's take on the concept. For them neo-feudalism means the privatization of governance, in big corporations. From the right it seems to be a way of critiquing the welfare state and social democracy.

But I want to think of neo-feudalism not as something imposed by a political or economic elite, but as something freely chosen by modern people.

I take as my text Eric Foner's Reconstruction: America's Unfinished Revolution 1863-1877. In it he discusses the experience of the recently freed slaves in the mid 1860s.
For [the adjustment to a new social order] required the abandonment of some traditions inherited from slavery and the adaptation of others to the logic of the economic market, where the impersonal laws of supply and demand and the balance of power between employer and employee, rather than custom, justice, or personal dependency, determines a laborer's material circumstances. (p.106)
Many slaves refused to work for big plantations after getting freedom; others were outraged that they would have to find their own food.

We all, from left and right, use the word "feudalism" as a pejorative. From the left it is thrown at corporations and globalization; from the right it is thrown at big government and entitlements.

But I want to use the word in a different sense. I think that most of us choose to live in dependency. For instance, the Bureau of Labor Statistics table of employed persons for 2014 shows 135 million wage and salary workers and only 8.6 million self-employed unincorporated workers. OK, so there are 23 million people in "management, business, and financial operations occupations," presumably including everyone from CEOs of mega-corporations down to the president of B&B Drywall and mid-level corporate bureaucrats.

I am trying to say that most of us reject a life directly exposed to "the impersonal laws of supply and demand." We choose to work for a boss as an employee, meaning that we let the boss deal with the day-to-day risks of supply and demand in return for a regular paycheck. And then we complain if he makes a killing, or if we get laid off because our "non-negotiable demands" have bankrupted his firm.

For many of us, even the risks of working for a small company and its exposure to the impersonal market are too much. We look for employment in a big corporation or a government where the impersonal laws of the market are far away, and insured against by seniority rules, grievance procedures and a pot-pourri of benefits and pensions.

Obviously there are many kinds of people in the world. Some are adventurers and seek out risk and difficulty. Others seek out a comfortable billet from which they can never be fired.

The problem is that neither the risk-taker nor the risk-avoider truly face reality. The risk-taker will fall back on relatives or the bankruptcy laws if his plans go awry. And the risk-avoider is never willing to pay the real cost of allocating all risks to his employer or his local politician. So we have highly-leveraged bankers and hedge-fund operators looking for a bailout during a financial meltdown. And we have government pensioners outraged by "austerity" and oblivious to the fact that their demands end up bankrupting the nation when the government runs out of other peoples' money.

So what's the solution? It's perfectly simple. We reduce the incidence of force. If the risk-taker gets in trouble we help him because he's a human just like the rest of us. If the risk-avoider gets laid off because his employer has been asleep for the last 50 years we help him too. Because he's human and we are too.

But I don't believe we want to encourage people to believe they have a right to assistance, enforceable by government enforcement officers. That way is the law of the jungle, not the kindly assistance of neighbors and friends.

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