July 20, 2004
POUR QUI SONNE LA CLOCHE?
France: the long, slow death of Moulinex (Frederic Lordon, Le Monde Diplomatique, July 2004)
France’’s largest electrical appliance manufacturer, Moulinex, was a household name worldwide. In 2000 the Italian group Elfi bought out the company, but it fell deeper into financial crisis and eventually filed for bankruptcy. It is a textbook case of the effects of globalisation [...]With constant threats from competitors, no respite is possible: attacks by rivals, themselves fighting for their lives, must be constantly repelled. This was globalisation’s great leap forward - or, rather, backward: demolition of the barriers that, by isolating national markets to some extent, permitted the development of protected production and avoided systematic comparison of costs and profit rates. With the deregulation of asset markets, such comparison has become a permanent obsession. Prices are scrutinised and profit rates recalculated under the watchful eye of shareholders determined not to give an inch. The twin constraints of the asset and financial markets will bring all but the most robust to their knees. But isn’t that the virtue of the market: that only the fittest survive?
So let those survive who, with prices in free fall, can guarantee a 15% return on investments. It’s not hard to see that few will pass the finishing post. These are now the objective constraints on com panies. Mostly the companies did not invent them, even if some bosses, usually those who head monopolies with the least to fear, are stupid enough to praise them.
This is where our analysis begins to bite. We have to admit that many arguments put forward by the Moulinex management to justify their successive restructuring plans were well founded, at least in terms of economic logic, the only criterion they recognised. It is true that Blayau found Moulinex to be far too vertically integrated. A company cannot do everything itself. To subcontract parts manufacture and become an assembler is not unreasonable. It is true that the production appar atus was badly configured. For reasons of product ivity that can hardly be faulted (on economic grounds), the manufacture of identical articles on many sites could not be allowed to continue. It was necessary to regroup and make economies of scale. It is also true that, short of committing industrial suicide, Moulinex could not watch while the price of microwave ovens dropped 40% in 10 years, imports of coffee-makers from southeast Asia doubled and the Russian crash of 1998 caused volume losses of 25-40% for some products. It is true that the general wisdom in situations of tough competition is to put everything into leadership positions and jettison the rest.
All these things need to be said. But we must also clarify what caused them - the constraints of generalised deregulation - if we are to stop fighting the wrong battles and stop expecting bosses to do anything other but fulfil the requirements of the system of structural constraints with which they have to contend. Rather than vainly hope that bosses will become socially concerned and virtuous, we must apply our efforts at that point where structures are redrawn and the great rules that determine all the rest are made.
Unbridled competition is a curse in its objective effects and its anonymity. Once the exploiter had a face, that of the boss and his class. Today’’s exploiter is depersonalised and abstract: a set of structural laws that are distant and intangible but remorselessly active. It is still the capitalist who gives the orders and puts on the pressure, but he can blame everything on objective constraints. And, sadly, his hypocritical protests are justified. The tragedy of employees fighting for their livelihood is that local struggles have become hopeless without the prospect of a global political solution. Workers will no longer find the answer to their misfortune in the boss’s office.
Le Monde is an establishment paper, sort of the New York Times of France, so this article gives a good idea of how what would sound like an unredeemed Stalinist rant in North America plays well in the political mainstream there. This popular, visceral contempt for the market and entrepreneurs is why the French remain solidly dirigiste and expect clever bureaucrats from L’Ecole Normale to guide them to prosperity and solve all their problems, including saving their aged relatives from heat waves while they are at the beach.
But although the language may be shrill and foreign, some of the ideas are not. Both the left and right in America score political points out of protectionism, outsourcing, deregulation, etc. and are able to convince many that the market is a cold and merciless force that cares nought for them or their families and must be tempered or controlled in some way. All the impressive macro-statistics showing unparalleled growth and prosperity mean little to the dutiful, hardworking middle-aged father of four whose plant just closed.
And they are right. The market is cold and uncaring, which is why radical libertarianism is bound to fail. Political freedom and free enterprise are proven essentials to a healthy and resilient society, but, unlike socialism, they are not self-contained, comprehensive philosophies that address all aspects of collective life, as Adam Smith recognized. A society that believes only in an atomistic individualism with no obligations beyond basic civility will leave behind the dull, the unlucky, the emotionally fragile, the unattractive, the socially unskilled, the unhealthy and many of those locked into family obligations. That is a lot of us. It is both morally offensive and politically dangerous.
Free societies must be built on a socially conservative plinth of interdependence of family, community and faith. They will flourish with citizens that see duty to others as the definition of the good life, not “finding the real me”, self-actualization or any of the other noxious creeds touted by educators and pop psychologists that serve only to drive practical and ethical wedges between us. The exact extent of these duties will always depend upon empirical realities and the vagaries of human nature and cannot be defined a priori. But to ignore or evade them will lead to both political instability and a sterile existence wherein life’s highest purpose is summed up by that old Yuppie joke: “He who finishes with the most toys wins.”
Could it be that the essence of Marxism is protectionism? From self? From family? From thinking? From work? From the need to make choices? From markets?
From reality?
The opiate to end all opiates?
(As for the French, how long can this love affair with structures possibly last?)
Posted by: Barry Meislin at July 20, 2004 9:35 AMMr. Burnet;
Radical libertarians don't disagree with your statements here, except for the "bound to fail" bit. But we believe in the separation of State and Society in the interests of just the kind of robust social structures you laud. It's odd how many can see the benefits to religion from the separation of Church and State, but not for communities in the separation of Society and State.
Posted by: Annoying Old Guy at July 20, 2004 9:51 AMYou can't separate the state from the society unless the state is imposed from the outside, like a colonial government. The state is composed of people. The society is composed of people, some of whom are also state employees/officials. The society is the whole; the state is a part of it, has a place in it. The debate ought to be how much of a place should the state have?
Posted by: Mike at July 20, 2004 10:03 AMOkay, you're sophisticated, but tell the rest of us what
POUR QUI SONNE LA CLOCHE? means.
My guess: Why are we the clock?
No, wait: For what sounds the cloak?
Hmmm... Son, you need new clothes?
Seriously, help me out here...
Posted by: Roscoe at July 20, 2004 10:28 AM"For he who hasn't a clue?"
Posted by: Barry Meislin at July 20, 2004 10:32 AMLet me guess: For Whom The Bell Tolls.
Posted by: Mike at July 20, 2004 10:32 AMMike nailed it almost. "Who does the bell toll for?" Normally I wouldn't show off like that but I know Orrin likes a little occasional French to give a cultured je ne sais quoi to the site.
Posted by: Peter B at July 20, 2004 10:42 AMMike;
Just change "society" to "church" in your comment and see if you still believe it.
But just to give one counter example, we all believe that members of society should look out for each other. You can do this via the State (e.g. taxation and welfare programs) or through mutual aid societies, private charities, etc.
It's the exact same argument against the Caliphascists, who seek to create virtue by forcing the populace to follow the strictures of Sharia. But it doesn't create virtue, only resentful compliance.
Posted by: Annoying Old Guy at July 20, 2004 11:44 AMPeter:
Radical just about anything is virtually certain to fail.
Posted by: Jeff Guinn at July 20, 2004 11:45 AMAOG: Church is part of society. Private enterprise is part of society. The parts may or may not overlap but they are just parts.
A society can exist without religion but no religion can exist without worshippers. I don't mean that the society would be healthy without religion, but it can exist. Separating church and state? It can be done, somewhat (the fact that the same people may be in government as attend religious events means that there will be some overlap, but it can be kept to a level where one does not control the other.) They are just parts of a society.
Posted by: Mike at July 20, 2004 11:54 AMJeff:
Not even radical secular materialism and individual choice?
AOG:
Maybe there are many libertarians who personally share that perspective, but they are pretty quiet about it. It isn't helpful to see whole swaths of public issues as things not to be talked about simply because they are not in favour of state regulation. The fact that one believes the state should not be regulating or prohibiting something does not mean it is not an issue for public debate. How many voices do we hear arguing against restrictive abortion laws but nonetheless condemning abortion loudly and unequivocally?
Posted by: Peter B at July 20, 2004 12:04 PMHmmm. And the English Poor Laws were an example of how a Christian and religious society looked out for the hapless outcasts of enclosure and mercantilism?
Posted by: Harry Eagar at July 20, 2004 2:40 PMHarry:
At that time, the benefits of a mobile work force were not understood.
The nobles and government were wrong, but to condemn them from a 21st century vantage point is uncharitable and unsporting.
However, I share your contempt for the supposed "Christians" who tossed their yeomen tenant farmers and families off the land, and replaced them with sheep. It seems to me that some compromise could have been reached that didn't include the impoverishment of millions.
Posted by: Michael Herdegen at July 21, 2004 6:22 AMHarry/Michael:
You have been watching too many Hollywood movies. The enclosure movement was started by radical new freedom-loving, anti-feudal modernists who based their views on the rights of individuals and private property. They were opposed by royalists, traditionalists, peasants and the establishment Church, which together formed the basis of the losing side in the English civil war. The enclosure supporters were dissenting churchmen, the rising middle class and mercantile interests, the views of which animated the American colonists. Sorry, Harry, but they were as close to your beloved modern secularists fighting off the heavy hand of religion and tradition as you could find in those times. It was your fault, and I think you secularists should offer a collective apology and maybe reparations.
Posted by: Peter B at July 21, 2004 7:15 AMHollywood made a movie about this ?
What'd it gross, $ 20 ?
The noble estates were not "private" property, not as we now recognize it. The nobles, for the most part, held the land in trust for the Monarch.
Posted by: Michael Herdegen at July 21, 2004 11:40 AMMichael:
Cromwell with Richard Harris. Showed the King's forces cruelly dispossessing the brave peasants and building fences. It would more likely have been the middle classes and common law courts.
They didn't hold it in trust. They held it in fee simple or fee tail, which were feudal tenures that technically still exist for land ownership in Britain and Commonwealth countries. There were certain feudal restrictions on sale or inheritance, but it was as close to modern notions of ownership that anyone got in those days. You had to commit treason or high crimes for the monarch to take it back lawfully. Trusts were completely different.
Posted by: Peter B at July 21, 2004 12:00 PMSheesh. Where did I say anything against labor mobility?
My starting point was starving, helpless people. It doesn't particularly matter how they got that way.
The question is, what was the Christian response.
It was brutal, not loving.
This is not the place to explain the mysteries of English tenure, but enclosure was not of private property. Even copyholders, whose tenure would seem the least secure by our standards, were safe from that.
The economic arguments in favor of enclosure of the commons were powerful. The use of political power to distribute the commons was immoral -- though no Christian theologian, so far as I know, ever taught so -- and exactly comparable with what happened to state property when the USSR dissolved.
Michael is on point about ejecting tenants to create sheepwalks (a different process from what Peter seems to be referring to), and why I added mercantilism.
It's all very well to agree that economic efficiency requires the weakest to go to the wall -- although you don't hear the weak agreeing so much -- but if entire communities go to the wall, you have to wonder if you've defined 'weak' adequately.
Posted by: Harry Eagar at July 21, 2004 4:11 PM