Re: Collective wisdom

["Devine, James" <jdevine@xxxxxxx>]

I wrote: 
> > I think that profit-max is a better description of firms than
> > utility-max is as a description of people.
> 
> Again, I think the dominant view ignores alternative approaches.
> 
> If capitalism is a social system whose characteristic relations
> generate psychopathology i.e. some degree of irrationality in thought
> and action, this will appear in business thought and action as well,
> including in the character of the labour process.

I don't get the connection here. I refer to profit-max as a description of firms (one that's better than util-max for people) and suddenly you say I'm ignoring alternative approached. How do you know I'm ignoring _anything_? I can't say _everything_ I think in one single e-missive, so I have to leave stuff out. But that doesn't say that I'm ignoring anything. Or are you assuming that I represent the "dominant view"? I don't. 

Then you bring up the idea that capitalism generates psychopathology. I would agree (and I've made such statements on pen-l) if by "psychopathology" you mean conscience-free "anti-social personality disorder"  specifically (as the DSM-IV defines it) rather than psychopathology _in general_ (i.e., neurosis, psychosis, learning disabilities, etc.) (BTW, schizophrenia seems to have become a mass phenomenon with urbanization, not capitalism.) 

BTW, there are other sources of psychopathology (using either the specific or general definition) besides capitalism. Capitalism tends to _intensify_ psychopathology (of the specific sort) and in fact institutionalizes it in the form of profit-maximizing corporations.

If capitalism generates anti-social personality disorder in this way, then the assertion that "profit-max is a better description of firms" follows. (So we agree.) I don't think capitalism generates enough anti-social personality disorder among people to allow the util-max model to be a good first approximation of how people behave. So I'm back to the assertion you quote above. 
 
> Specialization and division of labour, for instance, may express a
> significant obsessional element and not be simply rational means of
> maximizing surplus extraction.  As Braverman points out, Taylor was a
> severe obsessional neurotic, a borderline psychotic in fact who
> suffered several psychotic breakdowns 

This reverses the causation. Before you say that capitalism "generate[s] psychopathology." Now, you say that psychological obession may cause (or intensify) the specialization, division of labor, and Taylorism that characterize capitalism (and Soviet-style bureaucratic socialism). 

It's more likely that causation goes both ways. But if Taylor hadn't existed, he would have been invented. Some ideologist of that sort was needed, just as someone like Adam Smith was needed to justify the division of labor. (If he hadn't done so, someone else would have come along. Or people could have quoted the physiocratic ideas form the French Encyclopedia.) It's capitalism and its management systems that generate the need to continually increase specialization, division of labor, and the separation of conception and execution in the labor process (as Braverman defines Taylorism). Thus, it's capalism that encourages and rewards people like Taylor.

Methinks that Taylor's excessive Taylorism is very common. Many pioneer ideologists go overboard. Chicago (IMF/World Bank/US Treasury) neo-liberal economics is also an extreme version of the standard "more pragmatic" ideology in economics. They play a similar role to that of Taylor. Taylor's excesses (and more importantly, the excessive applications of his ideas by many profit- and power-seeking capitalist managers) helped to broke down the barrier of craft control of the labor process -- so that a more "rational" version of Taylorism could eventually be applied once the capitalist managers had more complete control over production. (It wasn't just Taylorism. Lock-outs and hired goons helped.)  The neo-liberal excesses broke down the barrier of national control of national economies -- so that a more "rational" version of NC economics could be applied once the IMF/World Bank/US Treasury had more complete control. 

To blame Taylorism on Taylor's obsessive neurosis and borderline psychosis is not only an insult to "crazy" people but it also puts too much weight on one individual's psychological problems. (One individual makes history by his lonesome?)  It also assumes that "crazy" people are automatically wrong (under the standards of transhistorical rationality which you apply). I've been diagnosed as having mild Asperger's Syndrome and dysthymia (and I think these diagnoses are accurate). Does that mean I'm wrong? 

> (Keynes, explains Newton's
> irrational passions as expressions of a similarly severe obsessional
> neurosis - Newton suffered a paranoid psychotic breakdown in 1693.
> Keynes understands the machine dreaming - the "physics envy" - of
> orthodox economists in the same way.)

Not being into the analysis of holy books, I don't know "what Keynes (really) said" very well. But I'd point to two important issues here. First, one has to wonder why this crazy Newton fellow got so much attention and fame, so that people would want to learn from him.  (Why wasn't he simply sent to Bedlam and then ignored?) It's obviously because the physics he developed worked pretty damn well in practice (in a nonrelativistic frame of reference). 

Second, why would economists be attracted to physics, which is a different field than economics? I wouldn't look at the psychological neuroses and psychoses of ecoomists for an answer. (I'd guess that on average, economists are pretty "normal" in terms of neuroses compared to other academics.)  I'd look at the sociology of an economics profession operating within the context of academia (some of which was left over from feudalism) and imperialistic capitalism. (For this kind of analysis, see my article in back issue #16 at http://www.paecon.net/.) 

> Then there is the problem of how to deal with time.  
> Maximizing present
> value requires some rational ground on which to base prediction of
> future profits.  Keynes claims both that such grounds are usually not
> available and that most of those who control business decisions are
> psychologically unable to face this fact and so deny it by using
> irrational methods to predict what is unpredictable. This psychology
> also tends to make their investment behaviour much more unstable than
> is consistent with a rational approach to the future.  (Keynes also
> points to exceptions to this.  See, for instance, his obituary notice
> for his American businessman friend Walter Case. Collected Writings,
> vol. X, pp. 326-7.)

You're preaching to the converted here. I'd note that Keynes also pointed to the development of conventions as a way that capitalist "entrepreneurs" handle uncertainty. And note that uncertainty doesn't negate the idea of profit-max. Instead, it constrains profit max. 
 
> The tying of executive compensation to stock options increases the
> influence on business decision making of the irrationality dominant in
> the stock market.  For instance, the irrational emphasis on changes in
> current profits irrespective of the cause creates an incentive to
> ignore the long run consequences of decisions.

why is this preaching to the converted relevant? 

> The version of psychoanalysis I frequently make use of - Kleinian
> psychoanalysis - has been made the basis for the study of irrational
> aspects of business and other institutions that express their serving
> as "containers of anxiety." Elliot Jacques's work was the starting
> point for this.  Isabel Menzies Lyth's Containing Anxiety in
> Institutions illustrates the approach.  Robert Young has a survey
> article on the subject at:
> 
> http://human-nature.com/rmyoung/papers/pap146h.html

I don't know Melanie Klein's work and can't comment on its validity. See my comments below on psychoanalysis in general.
 
> There is an organization for students and practitioners of 
> the approach
> - The International Society for the Psychoanalytic Study of
> Organizations.  Their website is at:
> 
> http://www.ispso.org/

I'm no fan of psychoanalysis. Most of it seems to be a theory (or faith) that was developed to encourage the transference of money from the patient's pocket to that of the analyst. It was first developed to take advantage of the Viennese middle classes and has spread to the world (mostly, it seems, to New York City). Much of it is as sectarian as much of Marxism has been. 

My son (with Asperger's syndrome, possible psychosis (not otherwise specified), and possible bipolar disorder) once saw a psychoanalyst. Luckily it was paid for by the state of California. My son complained about his fencing mask being too small. The shrink said that it's because my wife's womb was too small. Not only was her womb more than abundant in size (since he was born 7 weeks early) but it turns out that the problem was that my son's fencing mask was too small. The shrink also encouraged my son's psychotic tendencies, by telling him that because his imagination was so strong, he'd created his own reality. Then he wanted to see my son three or four times a week (a psychoanalytic money-grubbing trick) ... We dropped that shrink like a hot potato. We've found nonpsychoanalytic psychotherapy of various sorts to be much more therapeutic. Eclecticism -- including some psychoanalytic insights applied judiciously  -- seems to be the best. 

BTW, Sigmund Freud himself was pretty crazy, while being quite sexist and a cocaine addict. Why should we respect his ideas? And why should be accept Melanie Klein but not, say, Christopher Lasch? 

Jim Devine