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Blog Post for 01/23/14
I found myself to be particularly intrigued by the discussion concerning the merit of greed during the Gilded Age during class on Tuesday. Particularly whether or not the newfound focus on capital accumulation, or what some might call greed, was either 1.) an inherently unnecessary evil 2.) a good in itself or 3.) a necessary component of economci progress that, while often having immoral motivations, is beneficial on the macro-level. Richard Schneirov’s article entitled Thought on Periodizing the Gilded Age: Capital Accumulation, Society, and Politics, 1873-1898 provides intriguing ideas to help us address this question. Ultimately his work seems to point towards the third understanding that posits as a necessary component of economic progress
Schneirov defines the Gilded Age as book-ended by two important transitions: a shift from a “self-employed” (196) mode of production to a capitalist one and from a proprietary competitive capitalist order to a corporate administered one. While both of these transitions are relevant to the question at hand, the first transition to a capitalist mode of production is of particular interest in the way that it illuminates the necessity of capital accumulation as an engine of progress. Schneirov, borrowing from Marx’s Capital, explains the progression from “simple commodity production” (199) where capital is merely a medium of exchange so as to procure commodity of equal value (C-M-C) and capitalism in which capital is invested into commodity in hopes of a profit (M-C-M). Fundamental to “simple commodity production” was an understanding among citizens that labor created value and that ethical exchange should thusly be equal. Schneirov points out the errors of this belief in noting that this supposed theft from producers was what modern economists would understand to be “the economy’s surplus, the sine qua non and the engine of progress and development.” (199) This understanding leads to an extraordinarily interesting notion concerning the causality of the economic shift during the Gilded Age; this shift towards a political economy focused on capital accumulation can be seen to have caused, or at the very least allowed for, the rise of big business and industrialization. This contrasts what seems to be a commonly accepted view that industrialization created the greedy economic culture of the Gilded Age. This is important to the question at hand because it demonstrates that a focus on capital accumulation (or what some might label as greed) was a necessary component of economic progress and not an avoidable vice or isolated shortcoming of the Gilded Age.
A question that still needs to be addressed is whether or not a political economy of capital accumulation is, by nature, driven by greed or, conversely, whether or not participants in the economy can invariably aim to maximize profits without being necessarily greedy.