There’s a guy who follows me. An old fan, who’s become a bitter enemy, like a lover scorned. He’s read all my books (thanks!). Only now that my criticisms of capitalism in particular have become a little more transparent, more barbed, more mature, he’s done a 180. He spares no opportunity to tell me what a fool, a hypocrite, a liar I am. It’s entertaining. I mean that. I respect — and enjoy — his passion, his need for truth. It tells me something about him.

Now, he’s a die-hard defender of capitalism — or so he imagines. The corn-fed American guy — privileged, to use a word I don’t like. He really, genuinely believes that capitalism is the noblest engine of human progress yet discovered or devised. I can’t blame him — that’s what Americans are taught. Maybe it is, maybe it’s not — that’s not the point of this essay.

I see — or at least think I see — a profound irony that he doesn’t. He thinks he’s a capitalist. But he’s not a capitalist. His beliefs, if he really examined them, make him, funnily enough, precisely, diametrically, the polar opposite of a capitalist. So he’s kind of a walking paradox — one that I think characterizes many Americans today. They imagine they believe in capitalism — having been told anything else, frankly, is wrong, forbidden — but if they stopped to think about it, what they really believe in exactly the opposite of capitalism. Only they don’t know how to express it, what to call it, or how to understand themselves that way. So then they turn around and call what they do believe in “true capitalism” — because they have no other frame, point of reference. I know — that’s convoluted (but what isn’t these days?), so let me explain what I mean.

I imagine in my head sometimes what he imagines in his. Let’s say that he woke up tomorrow, to find himself the CEO of one of America’s few “healthcare management organizations” (for everyone else, they’re the companies that provide Americans health insurance.)

In his head, I’d bet, he supposes that he’d do something like the following. Give all his customers a fair deal. Treat them with sudden respect and dignity. No more cancelling healthcare plans people have paid for! No more denying coverage to people just because you can. Give everyone a raise — a big one. No one working for me will struggle to make ends meet!

I imagine that he thinks he’d go even further. No more lobbying! Good capitalists play by the rules — they don’t tilt the playing field. No more paying weird, shady consultants to literally write Congressional bills that you then pay the Congressmen and women to pass. No more spending money on marketing campaigns to convince people we care — we’ll actually care, this time around.

And by way of all these kind and gentle acts, a minor miracle will come to be, he imagines. That people will “get what they deserve”, or “get what they pay for.” In economic terms, we’d say that he imagines that prices will converge to marginal costs, and value will accrue not to shareholders, but to everyone else’s surplus, consumers, employees, society — but you can ignore that jargon if you like: it simply means that he imagines that as CEO, he’d make sure that he maximized fairness, decency, equity, a square deal, goodness, truth, justice.

(In other words, my friend imagines that the problem is not the system — it is the people. If only the people were different — maybe people like him (or maybe not, and maybe I am being unfair) — if only there were virtuous and noble people at the heads of all these institutions, then overnight, a magical wonderland of capitalist utopia, a place of self-regulating markets, happy people, and better lives, would dawn. The problem is that none of that is true. The problem isn’t the people, really — it’s the system. You can be the noblest and kindest and nicest person in the universe. But if I made you a CEO in American capitalism — you would have to do terrible, strange, and backwards things. Things that you probably didn’t want to do. But you would have no choice in any way whatsoever.)

There’s only tiny problem with all of this stuff that my friend probably believes. It’s a fantasy — a fantasy which proves something interesting, funny, and enlightening. A capitalist doesn’t want to maximize fairness, decency, truth, justice, goodness, a square deal — they just want to maximize profit. And capitalism, as a system, will make sure that he does, viciously, aggressively, and totally — without any flexibility, choice, freedom, or even breathing room.

So now that we’ve explored the fantasy, let’s discuss the reality. What would actually happen if my friend woke up to be CEO of an HMO tomorrow morning — and tried to make it what he thinks is a “truly” capitalist institution? One that gives people a fair deal, that extends them a welcoming hand, that never denies them coverage, etcetera etcetera? (We’ll come back to the point that my poor confused friend doesn’t understand that this “true” capitalism is in fact something else entirely — something he has been taught to hate, fear, and reject all his life, which is why he doesn’t have the ideas, vocabulary, or thoughts to understand it, or himself.)

The first thing that would happen is that he’d have to present this plan, this agenda, to his board. They would laugh him out of the room — after they listened to him with incredulity. Then they’d make plans to fire him as soon as possible. His next-in-lines, his VPs and so on, would rub their hands gleefully, furiously hoping to rise into his position. Bang! Done.

But let’s imagine, somehow, that the board felt nice, too —maybe it was Christmas — and gave my friend the chance to do this turnaround he was so passionate about. It gave him exactly a year — which is what new CEOs usually get — to execute his plans. What would happen during that year?

Well, there would be a lot of customers pleasantly surprised to be happy, that much is true. But the value of the shares of his company would plummet. It would be the laughingstock of the stock exchange. Analysts would taunt and shout at him on phone calls. Hedge funds would mock him. Takeover plans would mount. Hostile bids would appear. Shareholders would file lawsuits — why are they the ones getting a bad deal? He’d begin to feel panicked, alone, and probably more than a little confused. Why was everyone against him?

At the end of the year, when it was time to present annual results to both the board and to the shareholders, my friend would have to walk into the lion’s den — if the company hadn’t been taken over, if the bankers hadn’t called its loans, if shareholders, aka hedge funds, hadn’t rebelled. He’d have to tell them that profits had cratered. Wham! There would be an uproar, he’d be fired — and then the stock price would “recover”, probably after the company had been sold to another which could “manage it better.” Wall Street would celebrate. The economy would “grow.” Politicians would gush. Everything would be back to normal — declining life expectancy in a “booming” economy.

Are you beginning to see the point? Everything that my friend imagines he would do as a capitalist comes with one very big problem attached to it. None of it’s capitalism.

Every single thing that he wants to do minimizes profits, instead of maximizes them. In that sense, my friend is badly confused. He imagines that he is a capitalist — but in truth, he is something more like the very opposite — he doesn’t want to maximize profits to begin with. What he really wants, though he hasn’t quite thought it through, is to hand earnings over to everyone else but capital — customers, employees, society, and so forth. How long do you suppose he’ll last as CEO? How successful do you think he’d end up being? What does that really make him, anyways? We’ll get to that.

If we made him CEO, in the end, profit would win, and he would lose. Why is that? It’s because (duh) that’s what capitalism is designed for. There is a legal duty to maximize profits. There is an economic and financial obligation, written into the structure of shares and agreements and contracts. There is a social expectation, amongst banks and funds. There is a cultural norm, too. These things are inviolable — you can fail at them, sure, but all that will happen is that you will be removed. The obligations will not change. You’ll be allowed to fight for customers and fairness and decency all you want — from the streetcorner, not the boardroom. The boardroom will look down at you and laugh, astonished.

Maybe, if you are really, really good — you have a magical charisma, like Steve Jobs — you will be granted more than a year, three, four, five, in which to maximize profits. But nobody will let you get away without maximizing them in the end. Not just banks, funds, and shareholders — institutions. But more deeply, structures — contracts, shares, agreements. They are all designed around this linchpin — and if you suggested changing it, people would simply think you had lost your mind, and not do business with you at all.

Do you see how funny and strange all this is? What my friend actually wants to set up, run, and manage isn’t a capitalist enterprise at all. It is something more like a social enterprise, a civic organization, or a post-capitalist corporation, which maximizes human outcomes, not profits — or maybe a charity, a trust, a social organization, a union, or a cooperative. Only he doesn’t really know it. He wants a country richer in those kinds of institutions than profit-maximizing capitalist ones — in other words, a social democracy. Only he doesn’t know it.

Many people who proudly call themselves “capitalists” aren’t not just capitalists in any way whatsoever — better yet, they don’t even have much of an idea that they’re not capitalists. They are wearing the label — but they don’t believe the beliefs, they believe in the absence of those beliefs. They are precisely the opposite of capitalists, if they bother to think about it a little better. They don’t want to maximize profits — they want to maximize “surplus”, which is to say, what people, employees, consumers, customers, and so on, get — or maybe they want to maximize fairness, or humanity, or decency, and so forth. But all these things are fundamentally opposed to maximizing profit — and a capitalist wants to maximize profit, and the system will make sure he does, either by punishing him if he won’t, or eliminating him if he can’t.

(So many people who call themselves capitalist are nothing of the sort — because they do not want to maximize profits to begin with. Maybe they suppose, at most, that higher profits will go “hand in hand”, tomorrow, with “doing the right thing” today — but that is not nearly the same thing as believing solely in maximizing profits, first and last and always.) They are just good and kind people who want to act morally, to do what is right —because all human beings ache with purpose. But they don’t really understand the most basic principle of capitalism at all, because they have been taught to believe it is everything except what it genuinely is. Hence the bizarre paradox of “true capitalism”, which, treating everyone kindly, fairly, gently, is the precise opposite of real-world, institutional, structural capitalism, the real thing, the genuine article.)

Do you see how ironic, weird, and maybe even cute this is? The “true” capitalism that many Americans imagine is not capitalism at all. Capitalism by its barest definition maximizes profits — but what many of “true capitalism’s” fiercest defenders imagine is a system that does exactly the diametrical opposite, minimizes profits, and maximizes surpluses, benefits for everyone else. In that regard, they are not capitalists at all — and genuine capitalists would laugh them out of the boardroom in a heartbeat. So what does that make them?

Who hopes to maximize surpluses for everyone else, at the expense of profits for capitalists? Who wants to maximize things like fairness, decency, and justice? LOL — if you need a label, socialists, social democrats, collectivists and cooperativists of various kinds, in fact. Or just decent and sane human beings, if we put labels aside. That is what my friend really is — just another person who is wise and courageous enough to put himself last. But Americans have been taught to fear, hate, and reject all those ideas, labels, frames, words — so they lack the vocabulary or thoughts or insight to fully understand as anything but capitalists, hence “true capitalism.”

I’d bet that many, many more people who call themselves “capitalists” are like my friend than are not. By “capitalism”, or “true capitalism”, they mean that they themselves would place virtues like justice, fairness, kindness, and decency first — precisely because they find maximizing profit at the expense of all else repellent, grotesque, and absurd. But that makes them the precise opposite of capitalists. All this is what Marx would have chuckled at — sympathetically — and called a textbook example of a false consciousness. Americans believe that they are a thing which they are not — and that way, the thing that they truly are never comes to be, and the thing they are not goes on ruling over them, having convinced them it is what they are. “True capitalism” means something like the institutions, organizations, practices, of a cutting-edge social democracy, that maximize many things which matter, than anything remotely resembling…capitalism. But seeing this difference with clarity matters, because unless you do, you will confuse the past for the future, and go nowhere at all.

Now, letting go of an identity is a difficult — maybe an impossible — thing. When people call themselves capitalists, especially Americans, quite often, they are not really thinking very hard about what it means — they are just giving themselves a kind of label of belonging to a caste, a stratum, a tribe, a group, maybe even an aspirational one. They are affixing an identity to themselves. But that identity is itself in profound conflict with the values, the morals, the ethics, that they believe in more deeply. One of decency and goodness and fairness and truth. The system they proudly cling to as a label won’t allow them to express the values they actually believe in as people — at least not enough, often enough, or well enough — that is the American problem in a nutshell.

These are the weird, upside down identity politics of capitalism, if you like. Like other forms of identity politics, they are shallow and reductive, leading us nowhere, really, but in circles. We are not just our labels, my friends. And rarely is that truer than in the case of good and kind people who proudly call themselves capitalists — but don’t even know that what they really are, if what we want is what we are, is precisely the opposite. Many people, especially Americans, who call themselves capitalists don’t want to maximize profits — that is exactly what they find grotesque and repellent. They want to maximize the opposite of profits — fairness, surplus, decency, humanity, justice — and that makes them the opposite of capitalists, too. What’s the opposite of a capitalist?

I think you know the answer to that question. So the real question is what it boils down to, so often in life. Can you admit to yourself who you actually are? Ah, my friends. Now you see how simple — yet how difficult — courage, wisdom, and truth are.

Umair

November 2018