Manufacturing Scarcity

While we are agreed that the prevalent system of State capitalism depends on the maintenance of artificial scarcity, there seems to be some lack of clarity about the ways in which this is achieved. Specifically there are questions over whether the result of artificial scarcity is an increase or a decrease in industrial output. It would seem obvious, absent other factors, that the way to create scarcity is to withhold output. In many cases this is however not so: the creation of scarcity depends on a significant increase in output.

The variable factors are the choice of technique and the role of the State in maintaining conditions under which certain technical options are viable. The techniques of mass production are both model-specific and capital-intensive, and therefore offer an advantage over artisanal or other techniques only when the rate of output is sufficient to cover the costs involved. That is, if the saving on unit cost multiplied by the number of units produced within a given time exceeds the costs specific to the technique: the so-called economies of scale.

The problem for industry arises when there is insufficient demand to warrant the techniques of mass production. The options then are either to fall back on artisanal techniques or somehow to create the necessary demand artificially. With the former the way to create artificial scarcity would be to ensure that one’s output is always less than demand, the viability of which would be severely limited by competition, absent State intervention. But given the opportunity to suppress competition the amount of artificial scarcity that may be generated is still limited by the demand that exists.

With the latter option, artificial scarcity is created by cultivating structures of need in order to ensure that demand is greater even than may be satisfied by the vast outputs at which the techniques of mass production are advantageous. This is not easily achieved without State intervention. Once established, however, structures of need may be built up over time to a scale wholly disproportionate to the original demand. The amount of artificial scarcity that may be generated thus is almost limitless.

It is obvious, then, that given the opportunity, capitalist industry will be more inclined to create scarcity by artificially multiplying and remultiplying demand than by withholding output.

It is important to understand that the very existence of certain techniques in certain industries presupposes some means of effecting the requisite levels of remultiplied demand, improbable except though the coercive monopoly of the State. It is erroneous to believe that such demand would persist in the absence of the coercive monopoly of the State except in the very short term.

Though there have been historical instances of direct conscious collusion (one thinks of the Great American Streetcar Scandal of c.1936-on) the usual way in which these conditions are created is by means of a future vision, which the State is eager to equip with the requisite hardware and infrastructure, not to mention legislative framework. In this the idea of spontaneous, linear technological progress and its underlying world-view play a large part. Thus the future vision may be presented as inevitable as well as exciting; “This is how we will live in the world of tomorrow!” And hence the task of creating the practical system which brings about the structure of contingent (i.e. indirect) needs, never quite consciously understood as a programme to create artificial economic demand, becomes an ostensibly noble labour of public service. And being established, the vision as built generates the desired plausible projections of future demand, and thus the necessity of adding more and more is not questioned.

Thus the manufacture of demand becomes a normal part of industry, and thus universalized the greater the concentration of industrial power, the greater the output, though this is ever insufficient to meet our needs.

Herein lies the core of a libertarian ecology: industry really does produce too much stuff, but not because consumers have insatiable appetites for stuff. It is not justified to chastise people for wanting a little when they have been made to need a lot. Their wildest desires are probably mostly rather modest compared with the structures of artificial need to which they are subjected. If we could eliminate the vastly greater part of our necessary consumption there would be ample world left over for all the unnecessary consumption we could imagine. This is quite contrary to what we are told, that only the longest-faced austerity can save us.

Expressed differently, we are making far too much for the amount of fun we are having doing so. The amount of creativity that is happening is spread over too great a volume of production. To make is a privilege, when making anything requires making several million more of the same, lest my and your efforts collapse the requisite demand. It should not be this way.

Free Markets & Capitalism?
Markets Not Capitalism
Organization Theory
Conscience of an Anarchist