Capital and Technology: Spurring Decline or Progress?

Proponents of liberal capitalism have long argued that economic prosperity is linked to both productivity and national product. As a result, political life is organized around economics in the Western world through the principles of freedom and individual liberty rather than compulsion from despots, monarchs, and priests. Economics thus supersedes political philosophy in almost every instance in Western life.

            In turn, human nature – which is shaped by imperfections and passions – is perhaps superseded by history and the idea that either history tends towards economic and social progress, or the idea that divergence results from the accumulation of power in the hands of capital and technology. In general, morality and the instinct towards self-preservation are intertwined in the liberal-capitalist tradition, and the goal for liberal capitalism is the betterment of the human condition through economic progress. But due to our instinct towards self-preservation, moral imperfection and thus inequality are natural byproducts of social reality. As Plato said, the three most important things to man are his mind, body, and property. There will always be a distinction between major holders of capital and wage earners due to natural imperfections in our social reality.

            Theories of history also play a fundamental role in separating liberal capitalism from communism and socialism. Whereas the former sees the goal of humanity as being continuous economic progress and the improvement of the human condition for all people, the latter views history as having a distinct outcome due to inexorable social forces such as capital and technology which supersede free will. From a Marxist standpoint, human history is mainly under the influence of a force known as “technological determinism,” whereby technology determines human history through shaping material conditions on a global scale. There are certain individuals who view technology as a lifeless instrument, the effects of which depend on how it is utilized. But these “soft determinists” are perhaps in the minority when it comes to the debate over the role of capital and technology in shaping our collective social reality.

            Based on Karl Marx’s theory of history, productivity – and thus economic prosperity – is determined largely by the means of production, which to a large extent is comprised of capital and technology. It is becoming more and more difficult to argue against the notion that capital and technology are becoming an independent force in shaping our social reality. Although the accumulation of capital and the development of technology are undeniably the two foremost determinants of our collective social reality in the 21st century, these trends are for better than for worse based on a liberal-capitalist viewpoint. Can capital and technology foster “heaven on earth”? Or are there adverse consequences for the preponderance of capital and technology over our social reality? Are capital and technology a bane or a boon to our existence? As a note, this author remains neutral on this issue.

            For one, Durkheimian “Anomie” and Weberian “Disenchantment” are social byproducts of an economic, political, and social system that is organized around capital and technology on a global scale, which carries its unique set of implications. Also, as the economist Thomas Piketty has argued, returns on capital continue to exceed income and output based on labor, which will inevitably divert attention towards issues such as inequality and social justice that can only be addressed politically, despite the fact that the political class is largely vexed by capital and technology. For the most part, economic production – and thus prosperity – is determined by capital and technology in the 21st century, given that capital is now largely allocated towards the development of technology. In sum, technology is the main determinant of economic, political, and social phenomena.

But as a consequence, the pace of exponential technological change has superseded the ability of people and societies to adapt to these changes, thus fostering the atmosphere and climate for possible political and social turmoil. However, the upside of technological change is elucidated by Thomas Friedman, who argued that the creation of a truly “global community” resulting from the profound interconnection and interdependence borne out of technological advancements in the late 20th and early 21st centuries will lead to incredible scientific discoveries and innovations. Divergence on a global scale coincides with convergence on a global scale, which has never happened to the extent that is being witnessed in this particular day and age.

            As the American historian Michael Lind has noted, the recurrent pattern in American history is that there is always a thirty to forty-year time lag between technology-driven economic change and the modernization of political and legal institutions to deal with the consequences of this kind of change. Fortunately, American political and legal institutions have always caught up with these technology-driven changes. The question is whether we can all adjust to the changes this time around. Moreover, the decline of manufacturing in the United States due to machines and offshoring has coincided with the increase in financial services over the last couple of decades. The result of this dynamic is a slowdown of American productivity and growth vis-à-vis China.

            According to statistics from the World Bank, China’s annual growth rate stands at about 6.6 percent, compared to America’s 2.9 percent annual growth rate. How does one boost American productivity in the face of Chinese competition? Traditionally, there have been four ways to boost productivity, according to the economist Subodh Mathur. For one, government can allocate money for “shovel-ready” projects such as infrastructure. Second, the government can put money in the hands of consumers to boost consumption, which in turn would help businesses and workers. Third, the government can provide incentives such as tax cuts and lower interest rates to businesses and firms in order to spur employment and investment. Or, governments can boost exports and reduce imports. But in order to overcome the visible economic and social inequities caused by capital and technology, Marx suggested that the working class affect the political and social superstructure that is layered over the economic superstructure shaped by capital and technology. Whether this can happen quickly is doubtful. In the American political system, change is designed to be incremental rather than sudden.

Although advocates of endless economic and scientific progress seek to create a world that at least resembles “heaven” through the clout that is amassed by capital and technology, roadblocks such as scarcity, social strife, war, economic and social inequality, systemic racism, climate change, epidemics, as well as extraterrestrial threats cannot be easily overcome and are standing in the way of “immortality, bliss, and divinity.” Whether human beings have an innate concept or idea of “heaven” which they seek to replicate on earth has long been a subject of debate between realist and idealist philosophers. But to say that the idealists who believe human beings have an innate concept or idea of “heaven” are essentially going against the grain in their efforts to create “heaven” on earth would be an understatement to say the least.

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