Utopia of the Pure Market

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Helmut Wilke:

"Except for the fascist perversion a main feature of all utopian thinking, from Morus and Bacon, Campanella or Marx, up to Bloch or McLuhan has aimed at promising the equality of people, sometimes equality and freedom, and also, as an apotheosis, equality, liberty and fraternity – in any case, there’s always equality. And every utopia has failed because of this unrealistic fixation on equality. Once people are left to themselves they seem to do everything in their power to stand out, to mark differences, to desire inequalities that is, even though many consequences of inequality may be painful in the process. All educational ideas, from Rousseau to Mao, have come to naught in the face of the inner hydra of man bringing forth all the more reasons for inequality the more brutally such reasons have been taken from him.

The market utopia frees itself from this dilemma and in this way gains an astounding strength. It is not interested in the equality or inequality of people. It postulates a much more radical equality, although not of people, but an equality of action parameters for the market place instead. As far as the two exclusively relevant roles in the market place are concerned, as supplier and consumer, people in a remarkable humaneness are regarded as equal there – regardless, that is, of religion or skin colour, sex or origin, strength or beauty. This idyll is tarnished somewhat by the fact that people have to step out on yet another market place offering up their labour and that on this labour market equality depends on certain qualifications. But this may be defined as nothing but a characteristic feature of a special market and in the larger picture of the basic equality of market conditions may be pushed to the side; the more so as everybody is free to act as entrepreneur rather than as employee.

Much more than on the equality of people the market utopia relies on equality in relation to the rules of the market. And indeed these rules know of no privileges. Bill Gates is subject to these rules just as the little corner shop is, General Motors just as the garage down the street. And not only that, whenever and because this majestic equality is in place, regardless of a person’s standing, it creates, without any further effort by the players, a derivative equality of the possibilities of development and innovation. Past merits and achievements count little when superior products or services are offered. More radically than any revolution the rules of the market see to it that established advantages, privileges, differences in status, or traditional claims are swept away as soon as a more attractive product, a better price, a superior service appear on the market. Up to the seventies IBM held a singular, seemingly invincible position on the computer and software market. The company became the shining example held up in business schools and the standard for national development and promotion strategies. Corresponding claims may be made for other market leaders such as Kodak, Daimler-Benz, Phillips, and many more. They all have been mercilessly pushed off their pedestals because new products and better offers entered the market. Josef Schumpeter’s “productive destruction” has gotten to them all and only by submitting unreservedly to these market rules, and with more innovative products and cheaper offers they have been able get back on top.

The utopia of the pure market, therefore, is a genuinely modern utopia. It does not, like the old utopias, and like Marxism still did, rely on tangible content matter of utopian bliss, on certain end time conditions of history as the utopian fulfilment of a human dream. The market utopia, much rather, is satisfied with postulating procedures and basic conditions that consequently bring forth, like a deus ex machine, a process whose complexity may be increased at will, a utopian continuity of change putting, while being self-referential and self-adjusting, people under the spell of a model of order that does not depend on noble motifs but on elementary egoisms.

“The market economy,” Karl Polanyi defines the utopia of the pure market (1984: 102ff.), “is an economic system that is controlled, regulated, and steered solely by markets. The organisation of the production and distribution of goods is left to this self-regulating mechanism. … Moreover, there must be no intervention in the adaptation of prices to changed market conditions, no matter if the price of goods, labour, property or money is concerned. Consequently there must not only be markets for all elements of the economy, but equally no measures or politics must be admitted that might influence events on these markets. Neither price nor supply and demand must therefore be determined or regulated; the only directives and measures permitted are those that insure the self-regulation of the market by creating conditions that make the market the single effective power in the economic domain.”

Thus the market utopia does not need to postulate a revolution and to hammer it into the heads of people. It replaces the one big revolution by a myriad of small local adjustments. These, too, may accumulate into cataclysms but in this case no revolutionary guards are required, only self-interested buyers. What a relief for revolutions. The legitimacy of current changes is out of the question. Success brings legitimacy. Just as electoral success creates political legitimacy, success on the market puts aside all further questions, particularly as both sides of the market transaction enter into relations voluntarily, as no buyer is forced into a particular purchase, and no seller is forced to sell. As long as the market offers alternatives it brings forth, with astonishing naturalness, legitimacy and effectiveness.

This built-in mechanism proves the paradoxical inhuman modernity of the market utopia. It stakes everything on the card of the rational protagonist, on the card of interest-led decisions of single persons, and in this way seems to take nothing more seriously than this single human. Yet at the same time it turns out that these individual decisions matter only marginally. What really matters are abstract aggregates of decisions winning through against other aggregates: e.g. Harrison White’s “tangible cliques of producers watching each other” (1981: 543). For protagonists, as market observers, relevant market data only ever result from the aggregation of a large number of transactions coming together to form a trend or pattern (Hayek 1972: 16ff.). In the process man, formerly positioned so prominently, vanishes behind a veil of irrelevance. The individual action of choosing per se is as insignificant as the individual vote in mass democracy. Individuals cannot claim their significance as such; they are only able to do so as elements of different aggregates, groups, collectives, etc. of voters or buyers designating majorities or market shares (Saul 1997: 148).

It might be instructive to look a little more closely at the ambiguous relation between market utopia and individuality. The market does not need any individuals, only protagonists able to observe and decide. The purity of the market and consequently the brightness of the market utopia grow with the numbers. The mass markets of the industrial age already were fairly advanced manifestations of a market logic of bartering relations made anonymous. They could do without any reference to individuality as only large numbers of transactions, “regardless of a person’s standing”, could bring to bear this logic of the translation of generalised observation into individual decision. Today, in the age of a renewed, more radical phase of globalisation, world markets are established, markets without boundaries and isolation, asymptotically approaching the utopia of the pure market. It would be mere romanticism to ascribe individuals an enhanced status on these markets. There are so many individuals that they do not count anymore. From the perspective of the market they are observable and thus real merely as masses and market shares." (http://www.myzel.net/biophily/moderne/willke_pu_en.html)