Marx's fragment on machines, another explication

This from "From Formal Subsumption to General Intellect: Elements for a Marxist Reading of the Thesis of Cognitive Capitalism" by Carlo Vercellone (Historical Materialism 15 (2007) 13–36)

Vercellone provides the familiar three-part division of capitalist history. Built into it is an assumption that workers fight for a combination of autonomy in labor processes, for better wages, and for skill preservation ("socialization of access to knowledge"), and these factors determine capital formations and modes of capitalist control over labor:

(1) formal subsumption, when workers still controlled labor processes but relied on outside capital. Workers underwent ‘precarisation’, that is to say, their livelihood was made insecure and dependent on wages. Thus they were compelled to work to survive. This wage dependency could seem like freedom, though, in some workers' experience -- the ones who were no longer serfs, for instance.

(2) real subsumption, or Fordist relations of production, in which the division of labor has separated out management of labor processes from their execution. "The attempt to save time, founded on the law of value-labour, is accompanied by the reduction of complex labour into simple labour and by the incorporation of knowledge in fixed capital and in the organization of the firm." In other words, Taylorist management styles and machines make craft knowledge irrelevant among workers in factories. Craft knowledge survives only in fringe production as nostalgic artisanship while mass-produced goods made in assembly-line style factories come to dominate markets. Working for wages becomes a technological necessity -- modern production by and large becomes too complex to be done as a lone artisan.

Capital assumes control over the making of stuff and the making of demand for stuff -- forcing/enticing people to be happy with mass-produced goods. The mass production process dictates what sort of stuff is on the market and a grateful mass market is expected to accept it without customization options -- without it speaking to them as individuals. (The one color of Model T is the quintessential example.)

Labor is separated from leisure in this stage, as it is deliberately separated from "intellectual and creative quality" by management, who seeks to control proprietary work processes. Wages and the consumption culture that derives from them contribute to this separation of spheres. The welfare system of a living wage

(3) cognitive capitalism, or post-Fordism, or immaterial labor, or the general intellect, etc., in which labor processes become indistinguishable from the self-managed, quasi-voluntaristic life processes of workers. Less explicit management and compulsion needs to happen, labor processes require less hierarchical direction as technological developments allow for the more or less unobtrusive harvesting of useful information, knowledge, innovation, affect, etc. from the life processes. "The productive value of intellectual and scientific labour becomes dominant and knowledge re-socialises everything, becoming the principal productive force." More productivity can be reaped by encouraging worker-driven innovation and unstructured social cooperation (albeit mediated and monitored), not treating them like assembly-line drones. Friendship and sociality and public self-fashioning (identity manufacture and confirmation/validation) are made productive -- a kind of covert labor. But with less control over the labor process, capital must assert control through financialization. Capital "will tend to privilege indirect forms of domination of production and of the mechanisms of surplus appropriation realized by means of the sphere of monetary and financial circulation." In other words, if you are a capitalist, don't run factories; run banks.

Financialization is corollary of a more autonomous worker -- it allows for indirect ways of exploiting that worker, so that the worker can feel more in control in a local sense (choosing where and when to work), even though the choices are circumscribed at a "way of the world" level. The "cycle of valorization" is "ever more autonomous from a social labor process which it no longer subsumes in real terms." The worker is producing in the "social factory," and expropriated at the level of financialization.

Precarization at this stage is not a matter of possibly starving; it's a matter of feeling irrelevant, unfamous, uncool, out of date, etc.

At this stage, the fragment on machines comes into play and Marx's hypotheses about the "general intellect". The general intellect,as I understand it, is the lived praxis of the knowledge about everyday life within capitalism, the making of ideas or memes or new semiotic information or new meanings for goods, and so on. Fordism relies on a bargain with workers, enriching their general education and leisure time to compensate for meaningless working life. But this lays the foundation for the "crisis of Fordism" as better-educated workers living a more personalized and individuated life in leisure time begin to demand more-meaningful work. A generalized demand for meaning characterizes consumer capitalism -- consumption becomes a form of production of meaning.

Marx writes: "the saving of labor time [is] equal to an increase of free time, i.e. time for the full development of the individual, which in turn reacts back upon the productive power of labor as itself the greatest productive power." Educational development in free time changes the nature of labor, the de facto social contract between capital and labor. Capital wants the old form of value, based on control of direct labor and labor time (keeping people in the office, paying them by the hour) -- but the new productive forms of labor have become social, happening online in various forms of innovation in lifestyles and fashion and so forth. So capital tries to strengthen intellectual property laws, create artificial scarcities in knowledge to reassert control. But now technology no longer supports a wage-paying system of labor control. Now technology supports networks, and the wealth of networks. Only massive state intervention could enforce the intellectual property laws that would restore the old regime of capital control over labor processes and innovation.

Hence this seems the key passage to me from the Fragment on Machines:

In this transformation, it is neither the direct human labour he himself performs, nor the time during which he works, but rather the appropriation of his own general productive power, his understanding of nature and his mastery over it by virtue of his presence as a social body – it is, in a word, the development of the social
individual which appears as the great foundation-stone of production and of wealth.

The source of value is networked humans coming up with new instantiations of generalized, shared collective knowledge about living in current times (the "general intellect"). Value is created there, in networks, in what Vercellone calls the "the totality of social times", not by machines streamlining production processes.

But with production being done outside of wage paying situations, and appropriation of that value not benefiting the workers, the argument for a social wage mandated by the state strengthens -- this would enable workers to continue to learn, self-fashion, form identities, innovate lifestyles without stultifying fear of earning money. Immaterial labor seems well suited to fit with a social wage and indirect methods of capital expropriation of value generated on networks (or to put that less pejoratively, entrepreneurs can find value on networks and profit while the value creators live their lives and get paid in identity, knowledge and self-satisfaction in creativity.)

Tribalism and decision-making

Ryan Avent, responding to Akerlof and Kranton's Identity Economics"

I've found the idea of tribalism to be increasingly useful in understanding political behaviour. Faced with the need to make a decision based on incomplete information, people may often attempt to understand how others like them are behaving and behave in that fashion. This isn't really a new insight; politicians have been playing to group identities forever. But it certainly seems that economists have been slow to incorporate it into their models of consumer behaviour. As in: I buy this phone because those I recognise as being like me buy this phone, I borrow against my home in this way because others like me do too, I develop expectations about the proper level of educational attainment because those like me have similar expectations, and so on.

Economists are sure to be uncomfortable with this kind of behaviour because it's much more difficult to model than simple rationality. But if they hope to contribute to the policymaking process, economists need to work harder to understand when a simple price incentive will work appropriately, and when identity filters mean that price changes will generate unexpected results.

My bold above. What makes this more interesting is that the feeling of "having incomplete information" is itself subjective and subject to manipulation. Politicians may try to instigate that feeling in order to evoke tribalist responses in constituents and voters that are easier to predict even than mathematically modeled, neoclassicist rational choice. (After all, who has the time for all that math?)

Similarly, marketers and retailers may also direct their energies at managing the consumer's relationship and comfort level with the information relevant to a particular decision by emphasizing lifestyle and tribalistic associations. With the identity aspects foregrounded, consumers might be more comfortable ignoring or not bothering to seek out the other information that might help clarify a decision in cost-benefit terms.

Impulse purchasing is an example of this; perhaps it can be understood as identity components overwhelming desire to work out what's a "good deal" or what's "fair". Fairness (in the economic sense, or in general) obviously has little to do with tribalism or the urgency and exigencies of personal identity. Identity is never a game of fairness; it is a game of invidious comparison and advantage and pointed exclusion -- a zero-sum game. Identity economics, ideally, recognizes that, how identity concerns can trump a Pareto-based efficiency of decisionmaking that leaves no one worse off. Identity issues and the symbolic aspects of exchange guarantee that someone is always worse off. And that aspect of exchange can be intensified.

Maureen Tkacik makes what may be the same basic point in this essay:

As a rule of thumb (and with some notable exceptions), the profit margins you could achieve selling a good or service were directly correlated to the total idiocy and/or moral bankruptcy of the demand you drummed up for it.

The best way to drum up idiotic and morally bankrupt demand (which might include racist, nationalistic sorts of wishes) is to inject as much concern for identity as possible into an exchange -- to attempt to control the rhetoric around a transaction and make it about who the buyer is, not what the buyer is ultimately getting. The entire history of advertising bears this insight out. Creating demand rarely involves the direct usefulness of the product itself but rather the associations that can be attached to it that make it correspond to a lifestyle, an identity ideal. What sucks about consumerism as a hegemonic economic system is precisely this circulation of lifestyles, creating a fog of "imperfect information" and imperfect ideas about that fog, so we don't know how uninformed we are even about the identity ideals we are pursuing, let alone how far we are from rationally calculating. Profits are largest when the identity quotient within the demand is highest, because it is the most irrational demand, while the corporate form on the supply side keeps it disciplined to adhering to rational calculation. Thus, very rationally, corporations those try to encourage the isolated humans they deal with into worrying more and more about identity issues, catering to our worst tribalistic impulses and insecurities about who we really are.

Amanda Marcotte, discussing choice architecture and political affiliation, writes, "Even simple information can be distorted through an ideological or tribal lens." This doesn't make people "stupid," as she points out; it just suggests how efforts to align our identity with some idealized version (shaped by ads, or tradition, or institution, or personal imagination, or a desire to resist and identities those forces have imposed on us) can shift our perceptions about what information we need and what choices we feel we need to actively make to define ourselves. There is no rational approach to understanding the various bigotries of tribal identification, but there are systematic ways to exploit them and feed into them.

In other words, Thomas Frank's points in What's the Matter with Kansas have a broader application. We vote with our dollars for some blinkered evocation of our identity rather than for what economics tells us is in our best interests.