Market Mystification: the Mechanism Laid Bare

by Bertell Ollman

Abstract

People’s daily experiences as buyers and sellers in the market are the chief cause of capitalist ideology. Besides giving them/us a distorted view of social relations, nature, human nature, money, freedom and equality, it mystifies the whole sphere of production, which in terms of its extended effects may be the most harmful mystification of all. For it is only in production that we have a clear view of the social division of labor and the classes and class interests to which it gives rise. By hiding class, the market mystifies — in turn — class based exploitation and alienation, the features of the market that are based on these processes, their origins and possible futures, and the kind of politics (class struggle politics) needed to bring about socialist change. No attempt to reform multi-national corporations and globalization that fails to deal with market mystification, its causes as well as its effects, can hope to succeed.

I. Lack of Transparency

Amidst all the turmoil and exultation that marked the final days of the German Democratic Republic, an East German worker was heard to say, “What bothered us most about the Government is that they treated us like idiots”. In the capitalist lands, of course, people are first made into idiots, so when they are treated as such few take notice. The difference is one of transparency.

One major virtue of centrally planned societies, then, even undemocratic ones, even ones that don’t work very well, is that it is easy to see who is responsible for what goes wrong. It is those who made the plan. The same cannot be said of market economies which have as one of their main functions to befuddle the understanding of those who live in them. This is essential if people are to misdirect whatever frustration and anger they feel about the social and economic inequality, unemployment, idle factories, degradation of the environment and exaggerated forms of greed that are the inevitable byproducts of market economies. But to the extent this is so, only a critique of market mystification will enable us to put the blame where it belongs, on the capitalist market as such and the class that rules over it, in order to open people up to the need for creating a new way of organizing the production and distribution of social wealth.

In placing multi-national corporations and globalization at the center of this conference, there is a danger of mistaking needed reforms in the current forms of capitalism with what is required to do away with the worst effects of capitalism overall. By emphasizing the mystificatory role of the capitalist market throughout the capitalist era (however much that role has grown in recent years), I hope to show why any fundamental critique of multi-national corporations and globalization must be extended to their underpinnings in the capitalist mode of production, distribution and exchange.

There are, of course, many institutions, conditions, and practises that serve as “factories of ideology”. Among the busiest of these are the state, the media, the family, the church, school, the workplace, and wherever it is that sport, entertainment and gambling go on. Capitalism uses all this to make the abnormal appear normal, the unjust appear fair, and the unacceptable appear natural and even desireable. However, with the explosive expansion of consumerism — of the amount of time, thought, and emotions spent buying and selling and preparing for and recovering from these activities — the market has come to exercise a dominant, if not the dominant, influence on how people act and think throughout the rest of their lives.

II. Market Experiences Create a Market Ideology

What, then, do our market experiences consist of? Before answering, we need to make clear that what is called the “market” really refers to four interrelated markets, one for finished goods or commodities, one for capital, one for currency and one for labor power. In all four markets, individuals compete with each other to get as much money as they can for what they have to sell, and to pay as little as possible for what they wish to buy. Secondly, it is obvious that there are important class differences in how people participate in these markets. Only capitalists, for example, buy and sell capital and currency, while labor power is sold exclusively by workers and bought chiefly by capitalists. And while everyone buys finished goods (naturally, not the same ones and not for the same price), most of the selling is done by capitalists, including, of course, small capitalists. Despite such discrepancies, there are remarkable similarities in the market experiences of people from all classes.

Among these are

1) buying is the only way to acquire what you want, and selling — whether labor power, capital, or finished goods — is the main way to obtain the money needed to buy anything;

2) each person acts in the market as an individual rather than as a member of any group (corporations, though legal individuals, may be an exception, though their shareholders are not);

3) each one decides for himself what he wants to buy and sell;

4) everyone can buy something, if he can pay for it, and everyone can sell something, if he owns it;

5) no one actively restrains another when making or carrying out his choice;

6) everything and virtually everyone (if not yet everything about them) is available for sale, as evidenced by the fact they all carry a price;

7) because there is not always sufficient demand for the good one has to sell at the price one would like to get (or perhaps at any price), and because there is not always sufficient goods that one would like to buy at the price one would like to pay (or perhaps at any price), one is forced to compete with others in selling and buying anything;

8) to engage in such competition, let alone be effective in it, people become indifferent to the human needs of their competitors;

9) workers, capital, landed property and money are all seen to earn money, which is then called “wages”, “profit”, “rent” and “interest” respectively;

10) as the medium by which prices are paid and goods obtained, money becomes everyone’s prime want and the immediate object for which anything is sold.

While not the sum total of what everyone experiences in the market, I take these to be what typically occurs in the buying and selling of finished goods, capital, and labor power. Repeated daily, long before most people hold their first job, these experiences produce a very distinctive view of the world. With the market occupying such a central place in people’s lives, it is not surprising that how people behave there gets taken for what human beings are really like, and that the same misuse of induction determines how most people understand the nature, the fundamental nature, of whatever else they encounter in the market.

Thus, human beings get thought of as atomistic, highly rational and egoistic creatures, whose most important activity in life is choosing (really, opting): because people choose without interference what they want (really, prefer), they are thought to be responsible for what they have (and don’t have): the main relations between people are taken to be competition and calculated utility; the world is thought to consist of things that can be bought with money, so that things come to be viewed largely in terms of what they are worth; the ability of capital, landed property and money to earn more money is considered a natural property of each of these economic forms: money is understood as power, without which nothing is possible, so that greed for money becomes perfectly rational: being allowed to do whatever you want for money and buy whatever you want when you have some serves as the paradigm for freedom; and equality is when others can do the same.

What stands out sharply from even this brief summary of market thinking is that nothing that takes place in society outside the market or in the past of society is introduced to account for any of the phenomena mentioned. How is this possible and what are its effects on people’s thinking overall? Welcome to the world of market mystification.

III. Mystifying Production, Which Leads to...

By “mystification” I am referring to the kind of broad misunderstanding that results from the combination of hiding things, distorting them, misrepresenting them and confusing them. All of these processes are to found in the operations of the market. While everything can be said to be effected to some degree by our experience in the market, some things suffer far more mystification than others. The mystification of human nature, social relations, money, freedom and equality, which were mentioned above, are widely recognized, if not well understood. Less well known is the pervasive mystification of the whole sphere of production, which in terms of its extended effects, may be the most harmful mystification of all.

As regards production, market mystification occurs in part by occluding the whole sphere of production from view, so that exchange seems to on in a world by itself. We have just seen how the market gives rise to its own in-house explanations for whatever people experience there. To be sure, everyone knows that whatever is exchanged must have been produced. Yet, in the way most people are brought to think about this subject — with the aperture of our internal camera set on extra-small — the market seems to be self-contained. Products are viewed as already “on the shelves”. Production goes on, of course, but it seems to be going on in the next room, and the door between the two rooms is closed.

The mystification of production doesn’t end with ignoring its presence or downplaying, if not dismissing outright, its influence on what occurs in the market. Whenever production cannot be ignored completely, adopting the vantage point of the market for viewing it, dressing the actors in production in the clothes they wear in the marketplace, has a similar mystifying effect. In this way, work becomes something we do only to earn money to consume. Just as the capitalist, by hiring us, is seen mainly as someone who gives us the opportunity to do so.

A third way in which the market mystifies production is by foisting a model based on market relations onto production, so that people think of the latter inside a framework only suitable to the former. Do people confront one another in the market as individuals? Then, the same must apply to production. Are individuals free to buy and sell as they want in the market? Then, the same must apply to their actions in the sphere of production. What is important here are individual preference, having a choice, and not being physically or legally restrained in exercising it.

If we examine production directly, however, without using the market either as a model or a vantage point, what do we find? We find people working together cooperatively to transform raw materials into useful goods, and experiencing most of their successes and failures collectively. The shared conditions in which production occurs move to the front of our consciousness. Starting out from production, we also find a complex division of labor that ensures that people working on a wide variety of jobs all contribute to the common good. Yet, and this too emerges clearly, not everyone seems to be working. Some, the owners of the means of production, are only giving orders, and that from afar.

What stands out, then, when production is approached directly is

1) the social nature of human life (it is our shared situation and qualities, and not our individual differences and preferences that come into focus);

2) the social division of labor along with the cooperation it requires and enforces; and

3) the class division of society between owners of the means of production and those who work on them, together with the domination of the former over the latter.

By contrast, all of this appears, if at all, very murkily from the vantage point of the market or within a model based on market relations.

Production, too, of course, is not without its mystifying features. Under conditions of capitalism, it could not be otherwise. Competition for a job as well as on the job, for example, contributes to an atomistic view of self . Compared to the market, however, production is an oasis of important economic truths, but taking the road that passes by the market is a sure way to miss them all.

IV. Hiding Exploitation and Alienation, which Leads To...

Only now are we in a position to grasp Marx’s account of this domination and of the particular forms it takes in the overlapping theories of exploitation and alienation. Very briefly — though sufficient for our purposes — exploitation can be said to deal with the workers’ loss of part of the wealth they create, while the theory of alienation deals with the workers’ loss of self that occurs in and through the process by which exploitation takes place. Both theories focus on the common situation of the workers, what they share as a class, and the same is true of the capitalists.

For Marx, all the wealth of society is created by workers transforming the stuff of nature into things that people want. In capita capitalism for their efforts, workers receive a wage that allows them to buy back in the market a part of the wealth that they produced. The remainder, which Marx calls “surplus-value”, stays with the capitalists and is the basis of their wealth and power.

While the theory of exploitation highlights the workers’ relationship to the capitalists in the process of production, the theory of alienation focuses on what happens to the workers, to their human nature, in this same process. What occurs in capitalist production is that the qualities, and mainly these relations, that mark us out as human beings get transformed in ways that diminish our humanity. Under the control of the capitalists, essentially a wedge is driven between key elements of an organic whole — between the worker, his labor, his product, and his relations to others — so that they seem to exist and function independently.

This form of dehumanization is particularly acute in the capitalist era. And, as with exploitation, it is the situation workers are in as members of a class, and not the special circumstances of an unlucky few, that accounts for the workers’ loss, of surplus-value in the case of exploitation, and of self in the case of alienation. As with Marx’s theory of exploitation, too, through mystifying the process of production, the market hides the class relations that frame the theory of alienation.

V. Distorting The Rest of Society, Its Real Past And Potential Future

After production, it is probably the state and politics that suffers most from market mystification. People do a lot of their thinking in areas they know relatively little about through analogies with swubjects about which they know more. The market serves many people in this way when they come to consider politics. Thinking by analogy with the market — confident that their experience in the market, and the clear perceptions and strong emotions it gives rise to, have provided them with basic truths that can be applied anywhere — people tend to emphasize some features of our political life, while distorting and totally ignoring others. The role that each individual plays in voting (picking a candidate,just as one chooses a commodity as in the market), and the need for there to be more than one candidate to choose from (even if they are different versions of the same thing, as often happens with different brands in the market) are widely taken to be the main features of our political system.

What gets a free ride in this account of politics, unmentioned because unseen in any model derived from the market, are the class relations that underlie our political practices, and how most of our laws (including the Constitution), judicial decisions, and the administration of the laws are all bent to serve the interests of the capitalist class.

By hiding and distorting what occurs in production, as we saw, the market interferes with our ability to grasp the social nature of man, the division of labor, and the constitution of classes, which in turn makes it impossible to understand either exploitation or alienation, to say nothing of politics. But the theories of exploitation and alienation also provide us with the best explanations for the various “mysteries” that we found earlier in the market, so in mystifying production the market ends up by mystifying itself. For example, the quasi-human power that some things exhibit in the market, where capital produces a profit and money grows interest, in what Marx calls the “fetishism of commodities”, is also attributable to the wealth that is first created and then taken from the workers in alienated production. Where else would the new wealth embodied in profit and interest come from?

The list of mystifications produced by the market is still not complete. For if exploitation and alienation account for some of the most puzzling features of the market, then the origins of the market can be found in the history of these two conditions. It is in the development of exploitation and alienation, which Marx usually treats in terms of the rise of the capitalist mode of production, that we can discern the market’s own past. But if exploitation and alienation are rendered invisible, it would appear that the market never originated, that it has no history, that it is a natural phenomenon.

But the past contains the roots not only of the present but of the future. So still another mystification of the market is that by hiding production, which effectively hides exploitation and allienation, which in turn distorts our understanding of the market’s own distinctive features as well as their origins in the past — by hiding and distorting all this — the market also hides its own potential for becoming something other than it is. By examining the conditions that led to capitalism and how difficult it is becoming to reproduce them, Marx casts a prophetic light on the worsening problems (and the disappearance of old solutions) that will eventually cause the demise of this system. At the same time, he wants to draw attention to a variety of new conditions opening up new alternatives for society as a whole, that have emerged as part of the same developments, and which could become the basis of the system that will follow.

VI. Toward What Kind of Politics?

Finally, by mystifying the possible future of the market, as well as its present character and its real past, the market mystifies the kind of politics required to deal effectively with its own worst problems, to wit, social and economic inequality, unemployment, overproduction (relative to what people can buy), pollution, and periodic crises. Working with an ahistorical notion of the market, itself detached from developments in the sphere of production, these problems seem to exist independently of one another as well as of the system in which they arose. Capitalism’s lack of transparency greatest just where our need for transparency is most ac acute With nothing more to go on that the form in which each problem presents itself, the solutions that are advocated usually involve getting those with power to change some of their practices, particularly as buyers or sellers of commodities, labor power and capital, viz. increase investment in poor communities, hire more workers, boycott certain stores or products, etc. The aim is not to get rid of the market, since this is considered impossible, but to reform it, to make it work for everyone, with the implication that this ideal state is attainable.

Not so with Marx. Starting out from production, he is involved immediately with the interaction of classes and its effect on what happens in the market, including all the problems that arise and the injustices that they cause. The political strategy derived from this approach gives priority to the working class — not because it suffers more than other victim groups — but because the particular form of its oppression (exploitation and alienation) gives workers both an interest and the power (through their position in production) to uproot all the oppressions currently associated with capitalism. Our final complaint against the market, then, is that it mystifies the politics of class struggle, both its centrality and its potential, as well as what’s needed to make the workers (our side) more effective in carrying it out.

In drawing up this bill of particulars against market mystification, I may have made it sound more like a seamless whole that it really is. There are, after all, major contradictions in the operations of the market, such as that between the individual’s freedom to choose and the restraint that comes from not having enough money to buy anything; or wanting to sell your labor power and not being able to find anyone who will buy it. Such contradictions bring many people to question market verities. Likewise, the experiences people have in other areas of their live, particularly in production — though always contributing something to market ideology because of the capitalist context in which it occurs — also establish a counter model and alternative rules of the game. These often stress the importance of cooperation, and clash head on with ways of thinking promoted by the market. And, of course, criticisms of the market, if they survive the sophisticated forms of censorship thrown up by our ruling class, can also help to undermine what we learn as buyers and sellers. If all these “countervailing forces” were not present, capitalism would not need such an imposing consciousness industry to reinforce the ideas that arise as a matter of course from our immersion in the market. Yet, overall, with the spread of market relations to all walks of life and their growing importance for our very existence as well as an increasing number of our joys and sorrows, the market has become the chief mold in which most of humanity’s worst imperfections are cast, just as the mystifications associated with the market have become the major ideological defense for the status quo.

And multi-national corporations and globalization? The detour I have taken through the market in this talk was meant to show that the mystifications associated with it are likely to sabotage even moderate efforts to democratize the economy. Hence, any attempt to seriously reform these current forms of world capitalism must give equal attention to transforming the market relations that undergird them. The struggle to render society transparent is an integral part of the struggle for socialism.

June 24, 2003