A first round of workshops on capitalism, using some basic tools. This will be followed by further rounds as I develop further tools.
The tools to be used in this workshop are some basic, logical bullshit detection tools, centred around detecting ways of making false statements. The system I analyse is Capitalism.
The Oxford English Dictionary defines this as
An economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state.
Even the dictionary illustrates one simple, logical error with a logical flaw in its definition. It seems to imply that there are only two choices, private owners for profit or the state. The last part, after the comma, should be omitted. There are other choices, including a cooperative model where trade and industry are controlled by communities or by non-profit organisations.
This is similar to the rule known by logicians as the law of the excluded middle, which says that either a statement or its negation must be true. Either this is a cat, or this is not a cat, there is no middle option. Except in this case, the two options are not negations of each other. The authors of the dictionary have been misled by the fact that the commonest options are the two given, in our current capitalist environment. But there is no logical reason why other ways are excluded.
The law of the excluded middle is one of the so-called three laws of thought. Another is the law of non-contradiction, the idea that both a statement and its contradiction cannot both be true in the same context. Contradictions can include negations (This is a dog / this is not a dog) and statements that can’t both be true (This is a dog / this is a cat)1.
Contradictions are often easy to detect. Donald Trump was famous for contradicting himself in the same speech. Others are harder because they may be disguised, such as by using different terms which are synonyms. (I am determined, which is a virtue; you are stubborn, which is not).
A second way is to find that the statement is not supported by the evidence. This is more difficult. As limited beings with limited skills, we may not know how to assess the evidence. Even more so, we do not have the time to fact check every claim before we decide on a course of action.
Which leads us to the need for a third way, which is to judge the people who are making the claims. Although this is sometimes called a logical fallacy, named ad hominem, this shows that strict logic has its failings. It may not be absolute proof that you have a cancer that a well-known oncologist has told you that they have reviewed all the tests and all the images and that unfortunately you had a tumour and should have treatment, but you would be well advised to trust them more than a person who has no medical training who said that they had reviewed the same evidence but concluded that you had nothing wrong with you and shouldn’t listen to the doctor.
This is also an illustration that understanding the world based on strict logic will never work. Here, we are using a theory supported by statistics. The theory is that under similar circumstances, people will behave in a similar fashion, on average. The statistics is how often they make false claims. We can’t know that accurately, but we can get a sense from how often they are caught out, though we also need to know how reliable those catchers are.
In this workshop, I will focus on the first and in a later one, on the third.
Some of the contradictions in capitalism are found between the claims made for the way in which markets are the best way to assure efficiency, and the way in which large corporations actually behave.
If it is far more efficient to have many, small, competing entities attempting to deliver goods and services, why do CEOs of large corporations buy out small ones instead of just buying their products from them? To be
Why do they have their own in-house departments instead of inviting bids for their goods and services? Because they know that the shortened communication lines, speed of decision-making and many other factors can make it more efficient then buying everything on an open market. CEOs are paid a lot, supposedly because the decisions on whether to contract out, buy a small firm, deliver in house or to divest themselves of an internal department are difficult. So why are we supposed to believe them when they say that the answer for government is always “deregulate, let the market decide” when they and the market often decide the opposite for themselves; that the top-down control of a CEO is often preferable to breaking up a corporation so the market can make those decisions?
The second form of contradiction is seen in claims like “we put our customers first”. They don’t. They put profits first. Certainly, for some businesses, paying careful attention to customers’ wants and needs is a prerequisite to making a profit, so much of the time, putting customers second and claiming they are first is a good idea, but they could always cut prices or offer more for the same money but they don’t unless under competitive pressure to do so. In a capitalist environment, they have no choice but to put profits first, regardless of any intention to put customers first, or the business would fail.
Cooperatives, businesses which are owned by members, which can include customers or workers or both, or even suppliers, can find a better balance because the profits get paid back to the members but as they exist in a majority-capitalist economy, they are subject to some of the same constraints as the corporations they necessarily compete with.
There is a reverse form of contradiction, the false repetition. This happens when a word has different meanings. The same sentence can mean two different things, because the meaning of one of the words changes depending on context.
“Efficiency” is one of these. Efficiency is the ability to accomplish or fulfil what is intended based on the amount of the variable inputs, so the claim that something is efficient depends both on what input is measured and on what is intended. If the purpose of a corporation is regarded to be to make money for the shareholders and from their point of view the input is their investment, then efficiency is what is also known as return on investment. But if the purpose is regarded to be to make widgets and the input is considered to be labour, then the efficiency is labour efficiency. These two are very different and are only loosely related. Return on investment can be increased by paying workers less and selling for a higher price, without changing labour efficiency at all.
False repetitions are often used by establishing the truth based on one meaning and then using a second meaning as if the truth of it had also been established. If we granted that free markets are the most efficient mechanism in terms of return on investment, it does not mean that they are the most efficient mechanism in terms of producing food in terms of labour input.
The different types of system have more of a family resemblance, just as you might have three cousins with one sharing features with the second who in turn shares a different set of features with the third. It’s clear they are all related, even though there is little in common between the first and the third. This analogy was proposed by the philosopher Wittgenstein and I will use it again in the workshops, and will explain it and its uses in more detail in Family Resemblance in the Finished Tools section.
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The third is not so useful in everyday life, it is the law of identity, which is that a thing is identical to itself. I don’t recall examples of people claiming otherwise. ↩