Conservative Fascism

I feel there may be some confusion about the relation of economic power, property, business, markets, to fascism, perhaps caused by a determined and ongoing conservative, right wing rhetorical effort to inaptly cast fascism as communism. Let’s discuss it this week.

First, let’s get something out of the way. Both fascism and communism are authoritarian, anti-democracy movements led by aggressive, power hungry “vanguards” who suppose they know better than the voters and are supported by people who agree with them or are complacent, indolent, indifferent. That’s the kernel of truth to conservative rhetorical efforts to associate fascism with communism. Now let’s discuss why they’re different focusing on their views on economic power, markets, the allocation of resources, that sort of thing, and why conservatives resort to such subterfuge. 

Fascism is a conservative, right wing, anti-left movement all about economic power, private property, markets, businesses, stock markets, rich people, and on. Communism is, economically at least, a left wing movement focused on alternative views on how best to allocate scarce resources. Obviously, the allocation of scarce resources, who gets what and why, is very important, which is why historically fascists and communists have always been, at the end of the day, deadly enemies despite their shared disdain for what they both see as weak, ineffective, unnecessary democracy. Thus, for example, fascists back in its European heyday, as the Nazis for example, supported private property, economic power, business, corporations, markets, rich people. They were meant to defend conservative values against left wing views including when delivered by voters in a democracy. Modern US fascists are very much the same. Under the US Constitution, voters may provide normative inputs to economic policy relating to economic values, goals, objectives, evaluation. They may revise the distribution of economic power, use or reject markets in some or all cases, regulate, etc. US conservative, Republican fascists cannot accept that. They perceive voters and democratic government as potential threats that must be stopped and the US Constitution as something that must be terminated because it allows such a threat. When voters agree conservative economic views, conservatives are happy to support democracy as legitimizing their views, but make no mistake, for them pursuing their economic views is not legitimized by democracy but rather democracy is legitimized by congruence with their economic views. US conservatives are fair weather friends of democracy. When winning, they’re meant to be representative of 18th century anti-monarchical “classical liberalism” including its unresolved tensions between democracy and markets, when losing, democracy is out but still they inaptly claim the title.

There are, of course, some relatively superficial differences between the old European fascist and modern US fascist take on conservative economics. Old European fascism was meant to be a paternalistic affair in which ostensibly naturally superior economic elites wisely ruled an organic society. They were meant to want to fix up any rough spots in otherwise free market systems, encourage private firms to care for workers, direct their fascist government to look after the welfare of all under their Great Daddy, the Leader, who was meant to care nothing for himself, only the nation, etc. Modern US fascism is a bit vague and coy on such issues, particularly the moral significance of economic power as evincing ethical merit, but even more importantly whether the rich are meant to then pretend an interest in woke, socialistic, welfare state goals like the welfare of others, society. But it’s not a very significant issue, more a rhetorical curiosity than anything else. In US fascism, one finds all sorts. Are ostensibly naturally superior rich people meant to rule as wise heads of the social family, so rich they’re no longer concerned about money, become philosopher kings? Or are rich people and their fascist government meant to rule like selfish, egoistic bastards because the magic of the marketplace means when they do that everyone else is helped as well, social welfare is maximized? Alternatively, is what happens to other people, social welfare, irrelevant? Modern US fascism is a Big Tent affair. It doesn’t really matter why one hates democracy, wants to terminate the US Constitution, as long as one supports authoritarian government by the rich, the economically powerful, the establishment elite, while keeping out the hoi polloi, voters, the poor.

Want to work out if you’re a fascist or not? Do you support democracy and the right of voters under the US Constitution to deliver views on laws about economic power, markets, property, regulations, economic goals, economic evaluation, and so on, that is, the allocation of resources? Then no. Or do you suppose, contra the US Constitution, one must prevent voters “interfering” or “distorting” the one true take on laws relating to economic power, property, markets, allocation of resources, and one must thus oppose democracy, terminate the US Constitution if necessary? Then yes.

To conclude, contra US conservative rhetoric, supporting conservative views on economics, economic values, policy, objectives, evaluation is consistent with being a fascist, if one rejects democracy to promote such views. Fascism is not communism. Fascism opposes both communism and democracy.

The Two Sides Of Labor (And Capital)

A post on issues caused by the conservative tendency to discuss people as “productive resources” rather than as people, per se, reminded me I haven’t discussed the dual role of labor (and capital) in neoclassical welfare economics lately. Maybe we can do that this week?

In neoclassical welfare economics, “labor” may refer to both an input or factor of production, on par with capital, for a mental picture let’s say a wrench, and people, the locus of preference ranks (called as “utility”), which the theory is ostensibly about. Where this dual nature of labor tends to cause problems is in the context of the role of equity considerations, the ethical issues related to resolving interpersonal conflicts of preferences, which are famously exogenous to neoclassical welfare economics. In the perfectly competitive market model, the price of a wrench as a productive input should tend to whatever it adds in value (money) during the production process under some pattern of demand based on the distribution of economic power, its “productivity.”  If one pays more for a wrench than it adds in monetary value to the production process (setting aside other potential sources of value), one is wasting money, not getting as much from one’s productive resources as one might. The price of the productive input labor, the wage, works the same way and thus also tends in perfectly competitive market models to whatever value it adds under some pattern of demand based on the distribution of economic power. In reality, the price of labor or wrenches may be less than the marginal product if the labor or owners of wrenches are desperate, need money, competing to get it. And if one productive input is paid less than its productivity, another may be paid more. But let’s keep it simple, shall we?

You see where I’m going with this, right? Ready for the inevitable train wreck? You’ve seen it all before? Let’s do an example to keep things simple. Let’s say some laborer, L, doesn’t really add much monetary value for one reason or another. Doesn’t matter why. Again, let’s keep it simple and say he’s just not the sharpest tool in the shed. His “productivity” is low. His wage is low. He’s barely scraping by. Let’s say someone else, S, has certain interpersonal ethical beliefs and supports non-market mechanisms to increase L’s ability to express his preferences and thus obtain scarce resources such as subsidized wages, minimum wage laws, regulations, whatever. Why? Doesn’t matter here. Maybe S thinks L is making a good effort and defines “merit” in terms of hard work or effort or reliability. Maybe L is suffering from relative want and S takes a utilitarian interest in his welfare. Maybe S thinks L has certain rights. Maybe S thinks it fair or just. What does neoclassical welfare economics say about it? Nothing. Because we’re talking about people, and the funny thing about people in modern neoclassical welfare economics is we can’t resolve interpersonal conflicts of preferences on the basis of “utility.” 

If one forgets the person and thinks only of inputs, one might suppose neoclassical welfare economics suggests taking manipulation of wages off the table as far as addressing ethical concerns about the distribution of economic power, allowing only so-called direct transfers. That’s an expression of fake distributional indifference. Mechanisms to manipulate or revise wages may be more feasible, practical, possible, than direct transfers. Neoclassical welfare economics doesn’t limit distributional indifference in that way. Neoclassical welfare economics doesn’t demand first best solutions when addressing distributional ethics. It doesn’t require people to jump through hoops, find the mythical Chimera, perform amazing feats, do the politically or practically impossible. Those are illegitimate roadblock arguments. Thus, for example, the normative argument in neoclassical welfare economics does not oppose labor unions, which involve equity issues acknowledged to have standing in that theory but not addressed, exogenous in that sense, but not in a more general sense. It evinces indifference. Wait. Did I just find a new equivocation? Nice. “Exogenous” in the sense of accepted as relevant in a theory but not discussed, which leads to certain conclusions within that theory, to “exogenous” in the sense of rejected, found irrelevant, in a theory, which leads to different conclusions?

Say what now? Labor isn’t people? It’s something people own and may supply to others for money? The same issues apply to capital, productive inputs as well as income-producing assets owned by people, with a price featuring in both the allocation of that input and the distribution of economic power.