For generations, the great debate in the West was over moral economy. What type of economic arrangements would result in the just society? On one side were various types of socialists, communists, and utopians. On the other side were free market advocates of various types, libertarians, and liberal democrats. Both sides claimed the moral high ground, as well as logical superiority.
Despite its utopian origins, communism came to be a reactionary creed, largely due to the work of Karl Marx and Friedrich Engels. Communism as we came to understand it was a reaction to the sudden urbanization and industrialization of Europe. Within a short time, tens of millions moved from rural agricultural life to urban industrial life. The urban worker was the new peasant.
For Marx, the conditions of the working classes and the economic system that created them were part of a historical process. Americans have been conditioned to think Marx was evil and his schemes were part of a plot to enslave the world, but in reality, he was trying to make sense of what he observed like every political philosopher. Marxism was a theory of history, as well as an economic platform.
Marxist economics, in all of its manifestations, is pseudoscientific nonsense, of course. The labor theory of value, the primary tent post of all Marxist economic schemes, makes the fatal error of claiming an ought from an is. The value of everything we see is the sum of its labor, but that does not mean we ought to value everything that way or that it is even possible to do so.
Despite this critical flaw, millions died trying to prove it was possible and practical to calculate the use value to society of goods and services by tabulating the labor value of them. The Soviets spent three generations of their best intellectual capital trying to solve the problem. In the end, they only proved that elites can remain irrational longer than you can remain alive.
What we think of today as free market economics came along a bit later. The Austrian School originated in late-19th- and early-20th-century Vienna. It was opposed to the historical interpretation of capitalism and economics. Current-day economists working in this tradition are referred to as Austrian economists and their arguments came to dominate in the West, particularly in America.
Austrian School economics is based on methodological individualism. This is the claim that social phenomena result exclusively from the motivations and actions of individuals. Subjective individual motivation explains social phenomena, rather than class or group dynamics. The marketplace, for example, is the result of the actions of the participants working from self-interest.
Like Marxist economics, Austrian economics is rooted in the false assumption that human beings are motivated by self-interest, particularly economic self-interest. At some level, we have always known this to be false, but the human sciences are now confirming it. The biological urge to pass your genes onto the next generation can manifest economically, but not necessarily. Humans can and do sacrifice their material interest for their group, because that ensures their genes live on.
Unlike Marxism, at least so far, Austrian School economics has contributed useful things to mainstream economics, without a staggering body count. The subjective theory of value and marginal price theory are two examples. It also provided an empirical basis for criticizing Marxism. In the 20th century, the Austrian model was simply a better model for producing plenty.
The current version of history is that the free market team beat the central planners in the great ideological struggle of the 20th century. A certain group of synthesizers played a role, but their political and economic arguments have been discarded in favor of painting them as contemporary villains for modern liberal democracy. All that matters is market capitalism won over the central planners.
Of course, transforming those synthesizers from the last century into all-purpose cartoon villains has an important role in modern politics. It hides the fact that the cosmopolitan global order has more in common with certain movements of the last century than the liberal pieties of today. The new world order is a synthesis of Marxist moral philosophy and Austrian post hoc market analysis.
Everywhere one turns in the modern age, they are pelted with moral slogans based in diversity, inclusion, and equity. This call to arms is every bit as radically insane as “Liberté, Egalité, Fraternité” was in the French Revolution. As in the revolution, it is more than just a slogan. It is the foundation of the new moral orthodoxy. It is the moral claim of Marxism, without the economic plan.
That economics comes from a bastardized version of Austrian economics. The global corporations imposing the new moral framework on the West are justified by their market dominance. After all, if you do not like what the duopoly that controls mobile communications has to say about morality, for example, start your own phone monopoly. The lack of an alternative is proof that the market has spoken.
The modern synthesis of Marxist morality with Austrian economics has been made possible by the microprocessor revolution. On the one hand, it has made finance capital a weapon that was impossible in the analog age. On the other hand, it has made informational asymmetry into currency. Controlling the flow of information is the modern version of controlling the means of production.
The result is a technological version of the Catholic Church in the late medieval period. Cosmopolitan globalism is a moral superstructure imposed on the people of the world. Instead of a model of throne and altar, the foundation is a tripartism of corporate power, state power, and the morality of the managerial class. Everything in cosmopolitan globalism, nothing outside of cosmopolitan globalism, nothing against cosmopolitan globalism.
The old denunciations of democracy, liberalism, and socialism from the fascists of the last century have been updated in the new age. The public will, as expressed through the democratic process, is now systematically marginalized. Liberal principles are condemned as contrary to the moral order. Of course, any effort to restrain corporate power is condemned as socialism.
Ironically, both the Marxists and the Austrian School adherents assumed that such a system was impossible in the long run. The violence and horrors of state capitalism would lead to revolution, according to the Marxists. The irrationality of centrally controlled economics would result in unsustainable scarcity, according to the Austrians. Time will tell if either is correct, but for now, the world is dominated by a synthesis of the two called cosmopolitan globalism.
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