Richard Telofski responds to our recently published article on capitalism and the ecological crisis.
Sometimes on the journey through an article, the reader will experience a nice trip. The author will escort the reader on a pleasant excursion, helping them to arrive at a destination, known as the author's point, that was well-developed by all the places visited along the way. But in other articles, the reader is not so fortunate. In those articles the reader never reaches the destination suggested by the places visited earlier in the journey. Through such an article, progress gets bumpy and the ‘wheels come off’ of the car employed for the trip, resulting in a crash on the highway of intellectualism and a failure to reach the implied destination. What am I talking about? An article that was recently published in Business Excellence magazine.
On April 24, 2012 Business Excellence published Capitalism and the ecological crisis, an article by Eve Chiapello, a professor at the HEC School of Management, Paris, France. In her article, Professor Chiapello seeks to make a point on how capitalism becomes “sustainable” by incorporating criticisms into the process of profit-making. Given that the word “sustainability” is currently a hot in the popular culture, her employment of this term is not only insightful but also strategic in that the usage of this terminology is likely to attract attention due to its topicality. After all, she did attract mine.
Professor Chiapello's insight is that the incorporation of criticisms, which she characterizes as “objections and attacks”, of capitalism are part of what keeps it going. She is absolutely correct. This is an insightful usage of the word “sustainable”. Given that capitalism is a system based on democracy, she is essentially equating the votes of the free market with criticism. The positive votes of the free market would be purchases, whereas the negative votes of the market could be defined as taking the form of customer complaints or perhaps the form of activist demands over certain corporate procedures. That is to say, these are precisely the “objections and attacks” that she says make capitalism stronger. Marketers call this “market feedback”. Businesses, and therefore capitalism at large, cannot survive without market feedback, without being responsive to the democratic input received from the system which they serve. Thus, criticism is essential to capitalism’s ability to sustain itself.
The first part of Professor Chiapello's article is pretty interesting stuff. In taking me on the journey to her destination—her point that to be sustained, capitalism must respond to the entreatments of its constituency even if those entreatments are critical in nature—Professor Chiapello introduces four specific types of criticism that can contribute to the sustainability, or evolution, of capitalism. Those critical types are: conservative, social, artistic and ecological, with much of the concentration of this article being primarily on ecological criticism.Professor Chiapello defines ecological criticism as highlighting “the interdependence between generations and species as well as the irreversible effects of human activity on the planet”. Professor Chiapello also says about ecological criticism that it “rejects the idea of unlimited economic growth and questions the ability of the capitalist system to ensure the survival of humanity”.
Interesting stuff, indeed. And I'm in agreement with her up to the point where she moves from the theoretical to the practical. In this shift, Professor Chiapello recommends three ways that ecological criticisms can be integrated into the capitalist model. This transition, for me, is where the wheels come off the argument made in this article. The three ways that she recommends are: 1) “green capitalism”; 2) “the development of a solidarity-based local economy”, and; 3) the “strengthening of the state's ability to force capitalism to respect the environment”. If you've read my other articles here on Business Excellence Online, you already know what I'm going to say next. It's that third one that really irks me. And it really irks me mostly because it is inconsistent with the places I was taken earlier in the article, specifically the visit to the concept that criticism can improve capitalism. But I'll get to that in detail shortly. First, let's tackle ways one and two.
1) “Green capitalism”. Now for this first method of integrating ecological criticism into capitalism, my four wheels are still on. For this manner of incorporating ecological criticism into capitalism, Professor Chiapello recommends that “corporate social responsibility incorporates ecological criticism by defining principles of sustainable development and justice”. Essentially, what I take this to mean is that when businesses receive feedback for more “green” products or services that they deliver those goods in a way that meets with the “sustainable” expectations of those issuing the feedback. Of course, the definitions of “green” and “sustainable” are always subject to interpretation and can mean different things to different people. If the marketplace is calling for “green” products, then of course business—capitalism—must deliver those products in order to stay in sync with the system which supports it.
2) “Development of a solidarity-based local economy”. Oooops. One wheel just dropped off. First, in this recommendation Professor Chiapello unscrews the lugs of that first wheel by saying that this type of economy “is concerned with meeting basic needs instead of producing and selling the superfluous”. Superfluous? In whose opinion? This is another one of those words, like “green” or “sustainable,” whose meaning varies according to the mind in which the definition sits. If a market buys a product, if a market votes in the affirmative with positive feedback, then the product is not superfluous, is it? And if a product is not purchased, if the market rejects it, the feedback, the criticism, from that market is telling the capitalist, the business producing it, that the product is superfluous. Since the feedback loop of “objection and attack” is paramount to Professor Chiapello's journey in explaining that criticism is essential to the sustainability of capitalism, I'm quite surprised that she took this side trip to pronounce non-locally produced goods as superfluous rather than letting the market of criticisms make that determination.
Second, in this recommendation for a local economy Professor Chiapello does not acknowledge the fact that as production is localized, not only do cost inefficiencies increase, but so do prices and along with that the number of sources of pollution. Due to the price increases alone, consumers would be likely to reject these locally produced goods. Negative criticism. But fear not: Professor Chiapello offers a remedy for this consumer reluctance. This article suggests that the initiative of localized production is “favoured in the competitive arena by market regulations”. Question: how does the iron hand of government regulation allow capitalism to become sustainable, to evolve, via criticism? More lugs fly across the road and a second wheel comes off. The car is getting ready to crash.
And now on to way number three, the one that really irked me.
3) “The strengthening of the state's ability to force capitalism to respect the environment”. Crash. Bam. Bang. There go the remaining lugs. Horribly, the last two wheels spin off causing the whole car, along with Professor Chiapello's argument of how criticism can contribute to the sustainability of capitalism, to crash tragically and horrifically, inviting, what we call in the United States, ‘gaper delays’ which clog up the lanes of nearby traffic and in this case are those which stand metaphorically for lines of intellectual thought.
The weakness of Professor Chiapello's argument here is based on the suggestion made in number two above, the introduction of market regulation to support localized production. You’ve heard of this ideal. Government solves everything. And now Professor Chiapello develops that idea more fully by recommending that ecological criticism be incorporated into the capitalist model by legal fiat rather than by the informative, iterative, and democratically-based market influences of “objections and attacks,” criticisms which she suggested at the commencement of the journey contribute to the strength of capitalism.
At the end of the journey through this article, I felt like I was hijacked to another destination, one not indicated or expected based on the places visited in the early part of the trip.
When I started to read this article, had I known that I was about to embark on a trip to the ‘government-knows-best’ garage or the ‘capitalism stinks’ station, places to which I have gone many times before, I would have simply stayed home, foregoing the journey and would have avoided the crash on the highway of intellectualism.
Richard Telofski is a competitive strategy and intelligence analyst. Formerly the president of one of the world’s first competitive intelligence consultancies, Richard currently practices at The Kahuna Institute where he studies the business effects of non-traditional competition. He blogs about “The War on Capitalism” at www.Telofski.com.