Do entrepreneurs constitute a class?

C4SS has been serializing a work on class analysis by Wally Conger. I don’t know much about this Wally Conger, but when I first began exploring the range of left libertarian thought via portals such as ALL and BLL, Conger was among the people identified with that movement. I subscribed to Conger’s blog for a while; finding the tone of almost every post to be, essentially, “not being self employed is for suckers.” Needless to say, it’s not hard to find any of a number of people and organizations whose message is essentially that. I don’t normally associate that opinion with the left (and do strongly associate it with the right). I have also found it to be the punch line of every sales pitch for multi-level marketing (MLM) arrangements. My working definition of MLM is the application of salesmanship to salesmanship. I don’t know whether Wally Conger is involved in MLM. One code I live by is giving everyone the benefit of the doubt, so I’ll assume not.

The point of Congerian class analysis (which is derived from Konkinite class analysis, and a repudiation of Marxian class analysis) is that entrepreneurs (particularly black market entrepreneurs) can come from any social class (e.g. people ranging “from tax-dodging businessman to drug-dealing hippie to illegal alien to feminist midwife”), and that the interests they have in common have nothing to do with class and everything to do with keeping an eye out for the “the fuzz/pigs/flics/federales/etc.

I myself haven’t constructed a class theory, but here I will give a rough outline of what I perceive the class structure of present-day American society to be. I arrived at this theory of class about the time I started reading a fair amount on the subject of finance about a decade ago. That, combined with observations made in the course of pseudo-career as just a temp, largely formed the basis of a tentative class theory. I identify three distinct classes that are actively involved in production. I call these (from top to bottom) financiers, proprietors and wage-earners. For what it’s worth, I tend to use the terms proprietor and entrepreneur interchangeably, which I suppose may be an abuse of terminology. For the purpose of this analysis, by “proprietors” I mean proprietors of businesses other than financial institutions. I’m operating with the assumption that financial institutions normally operate in the black while businesses other than financial institutions normally operate in the red. I got this idea from James Van Horne’s book Financial Market Rates and Flows. To that I added some of my own observations and came up with a class theory in which the role of wage earners is to kiss up to proprietors in hopes of being offered jobs, which is to say, being given permission to play an active role in production. Proprietors, in turn, kiss up to financiers in hopes of securing working capital, which is to say, being given permission to play an active role in production. Financiers are by definition people who operate in the black, so for them access to money is a given. This is where my pet theory of class intersects with my pet theory of money. Some say money is a storehouse of value. Some say it is a medium of exchange. Based on views attributed to sombunall (some but not all) characters of Robert Anton Wilson’s Schroedinger’s Cat Trilogy, I have adopted the view that the role of money in present-day American society is to function as permission slips:

In Unistat, due to the strong encouragement of
individualistic third- and fourth-circuit (semantic-moral) functions, slavery
had grown so repugnant that it was formally “abolished” within a
century after the formation of the pack constitution; it lingered on through
inertia in the form of “wage slavery,” which required that all
primates not born into the sixty families that “owned” almost
everything would have to “work” for those families or their
corporations in order to get the tickets (called “money”) which
were necessary for survival.

A theory of business organization that strongly parallels financier/proprietor/wage-earner is psychopath/clueless/loser, to which I was clued in by the (much recommended) writings of Michael O. Church.

In addition to the three classes I identify above as actively involved in production, there is a chronically if not perpetually unemployed underclass. Most leftists identify this as a subset of the working class, which consists of people who are not independently wealthy and therefore don’t have the option of not working. Unfortunately, working class people, understood thus, don’t necessarily have the option of working, either. The trouble with lumping the wage-earning class with the economically failing class is that it requires one to ignore a certain elephant in the room: Unemployed worker is an oxymoron. As long as paid work is classified as a privilege rather than the right—and it is by virtually all pro-market ideologies, including left-styled libertarianism—employed people are a privileged class relative to unemployed people. In all but the very least developed economies, the chronically unemployed do not normally starve—a fact that conservative and some other pro-market ideologues never hesitate to point out. Their punishment for failure to market themselves (which is NOT the same thing as failure to work) is the humiliation and subjugation of being dependent on others, whether that is family, friends, taxpayers or organized charity. In developing countries this unemployed underclass, this reserve army of the unemployed (one feature of Marxian analysis that left-styled libertarians, to their credit, do generally acknowledge) tends to be a large fraction of the adult population; sometimes a majority. This (as well as the fact that I’m allergic to anything that even smells like nationalism) is why I’m very fed up with populist (i.e. demagogic) slogans along the lines of “the Indians/Chinese/Mexicans (or other scapegoat of your choice) are taking our jobs.” Assuming for the sake of argument (as a devil’s advocate) that they are doing this, they certainly aren’t stealing them quantities anywhere near large enough to effect or approximate full employment in their country. Get a clue. The copper bosses killed you, Joe.

Anyway, my working theory of class (which is a work in progress) consists of four main classes. There are subclasses within classes. Within the wage-earning class there are the gainfully employed (defined as someone with a permanent full-time job with benefits) and the marginally employed (the precariat, or casualized workforce). There’s also an upper crust within the working class that might be called the “professional class.” Within the rejected underclass there are the sometimes-employed and the “unemployable.” Within the proprietor class, which I also call the entrepreneurial class, there are also subclass distinctions. The most important, I think, is the distinction between successful entrepreneurs and unsuccessful entrepreneurs. This tears a bit at the structure of my class theory edifice: If failed entrepreneurs are considered entrepreneurs then perhaps failed workers should be considered workers. One thing I cannot stress enough is that to me, class is functional, not quantitative. Some wage-earners have higher income than some entrepreneurs. It may even be the case that some entrepreneurs have higher income than some financiers, but finance is one area where small-time operators seem to be a thing of the past. Sometimes self-described entrepreneurs (who happen to be politically conservative or perhaps “libertarian”) delight in calling talk radio shows bragging about how many hours they work (or did in the founding stage) and how little they got paid (“below minimum wage,” they brag). Their reason for doing this is of course to stir the class conflict pot a bit by characterizing the wage-earning class (or at least those in it who don’t sit down, shut up and stop complaining) as having a sense of “entitlement.” The key difference between the proprietor/entrepreneur class and the waged working class as I understand them is not a difference in income, but in function, or role in the economy. Broadly speaking, the wage earner is expected to play a relatively passive role in the economy. The subclass tiers within the entrepreneurial class, as I understand them, are also based on how active or passive a role they play in the economy. Obviously, the upper tier of the proprietor class are the CEO’s in the non-financial sectors. An example of a relatively passive proprietor might be a franchisee. An even more passive one might be the proprietor of a business with one customer, although I tend to think of single-person businesses of this type as de facto wage earners who are de jure proprietors due to the technicality (in the case of Americans) of getting a 1099 instead of a W2. It’s one of the business world’s many strategies for shifting risk to workers.

The idea of a risk shift (or at least that terminology for it) comes from a book by that title by Jacob Hacker. The risk shift is real. The proprietary class (very likely under orders from their financier class puppet masters) is waging war against the working class; specifically attacking the gains they have made in terms of economic security. This is why I can’t go along with Wally Conger’s assertion that risk is “purely entrepreneurial.” Risk is everyone’s problem, and while I won’t say (here) that the wage-earning class is shouldering more than its fair share of it, I will say here that the trend is toward wage earners eating more risk, and there seems to be no end in sight for that trend. Obviously the risk shift has induced some working class people to try their hand at entrepreneurship:

George was an associate partner at one of the world’s largest technology and consulting firms until he lost his job last year in a wave of layoffs. For months, George knocked on doors but got nowhere because of the deep recession.

Finally, his old firm got some new projects that required George’s skills. But it didn’t hire George back. Instead, it brought him back through a “contingent workforce company,” essentially a temp agency, that’s now contracting with George to do the work. In return, the agency is taking a chunk of George’s hourly rate.

Technically, George is now his own boss. But he’s doing exactly what he did before for less money, and he gets no benefits — no health care, no 401(k) match, no sick leave, no paid vacation. Worse still, his income and hours are unpredictable even though his monthly bills still arrive with frightening regularity.

The nation’s official rate of unemployment does not include George, nor anyone in this new wave of involuntary entrepreneurship.

I think this trend reflects not an embrace of risk, or even an increased level of risk tolerance on the part of such people, but a loss of the risk management features of employment to the point where they literally have “nothing left to lose” in that department. Entrepreneurs (as opposed to those thrust into a form of pseudo-entrepreneurship) are active takers of risk, and as such are a class.

It is my belief that in a freed market or stateless society, the independence differential between entrepreneurs (should we make the mistake of working with them) and workers will translate to a power differential and ultimately a de facto authority differential. I say “belief” because I don’t know this would happen. I don’t know because nobody knows. Nobody knows what will happen in a freed market or stateless society because it is an experiment that hasn’t been tried yet. This is why actual libertarians (such as the ones at the Bleeding Heart Libertarians website) constantly prod left-styled libertarians with the question of whether they’ll stand by the non-aggression principle even if it doesn’t end up producing “socialist ends via market means.” I make no such promises, because I make no such predictions. This is where I think American individualist schools of anarchy miss the point. Liberalism is a bourgeois (proprietor class) ideology. Anarchism is not simply liberalism taken to its logical extreme. Like all genuinely leftist tendencies, it is a bottom up movement, not a middle up one.

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Quotebag #103

“Algebra II is an especially [weird] class because it’s advanced enough that most people will never use it in their every day life, but it’s basic enough to have almost nothing in common with what real mathematicians do.”—charlie

“Traversing an environment built for the automobile in anything other than an automobile, sucks.”—Andrew Price

Autostrada A4

“We are sliding towards a ‘market’ solution in so many areas of our public life. Schools, prisons, healthcare. So many areas where the perverse incentive of the market is the opposite of the public good. Remember the lesson of Monopoly (the game). One person ends up w/all the money, the rest… bankrupt.”—James Housel

“One issue I’ve long been bothered by is the libertarian fixation on the state as the source of coercive power. The strong form version is that the state is the only party with coercive power (and please don’t try denying that a lot of libertarians say that; there are plenty of examples in comments in past posts). Libertarians widely, if not universally, depict markets and commerce as less or even non-coercive.”—Yves Smith

“The American press are wholly owned and operated by those who seek to shift power from political to economic.”—Arthur Silber

“There is simply no way to maintain your dignity when unemployed for a prolonged period. Not in this society, at any rate.”—voxcorvegis

“Pain, exploitation and death were the attractor states for a billion years. Mr. [Stan] Larimer and other cyber transcendentalists ought to bear it in mind.”—David Brin

“There’s a country music classic titled ‘Take This Job and Shove It.’ There isn’t and won’t be a song titled ‘Take This Consumer Durable and Shove It.’”—Paul Krugman

“Having a market society automatically carries with it an undermining of solidarity. For example, in the market system you have a choice: You can buy a Toyota or you can buy a Ford, but you can’t buy a subway because that’s not offered. Market systems don’t offer common goods; they offer private consumption. If you want a subway, you’re going to have to get together with other people and make a collective decision. Otherwise, it’s simply not an option within the market system, and as democracy is increasingly undermined, it’s less and less of an option within the public system.”—Noam Chomsky

“From a purely data obsession point-of-view, it’s interesting how 1+1=3 when it comes to data. This is what makes it so hard to convince people they should care about privacy.”—David

“Allowing labor markets to clear more efficiently does not imply that their clearing price should plunge toward zero.”—Jim Haygood

“To punish the alien worker for the sin of the native capitalist is like the man who struck the boy because he was not strong enough to strike his father.”—Jewish textile worker

“When pushed about this issue, some Bitcoin enthusiasts irritatedly say “nobody’s stopping women from joining”. ‘Nobody is stopping you’ is the classic articulation of negative freedom, and its problems are best exemplified by the moshpit.”—Brett Scott

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Anagorism vs. minagorism

Minagorist is to anagorist as minarchist is to anarchist. I hate mixing latin prefixes (prefices?) with Greek roots, so I was thinking along the lines of a Minimercatus Center, but that seems to suggest a miniature Mercatus Center rather than a center that is minimally mercantile (or mercenary). The minarchists get away with mixing Latin and Greek elements, therefore I should also have that privilege.

Just as minarchism (it would seem) concedes the point that humans, left to their own devices, will slaughter each other, minagorism concedes the point that humans, bereft of incentive, will probably “[spend] most of their time drinking booze, smoking weed, engaging in primate sexual acrobatics, and watching wall TV.” Just as minarchists view coercion as at least as evil as it may be necessary, minagorists view non-entitlement of survival (and in more advanced stages of minagorism, independence and solvency) as at least as evil as it may be necessary. The question is how to minimize the role of the market in society to a level just barely sufficient to light a competitive fire under the buns of the population that is just barely hot enough to incentivize just barely enough Gee-Dee-Pee to supply 100% of the population with three squares a day and a roof over each head. If people want to compete harder to obtain luxury goods, the minagorist position is that they’re entitled to their choice of lifestyle, as long as it doesn’t cost the rest of us any leisure time.

Logo created by Zacquary Adam Green

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What’s going on at PBS?

Is is just my imagination, or has PBS (perhaps along with some other public television organizations in the US) been taking an editorial turn in a decidedly neoliberal direction?  Detroit Public TV (i.e. WTVS, or “Channel 56″) just last week handed one of its DTV side channels (56.2) to something called The World Channel, which I have taken to calling “the entrepreneurship channel,” largely based on their first week in Detroit having the lion’s share of the airtime occupied by a seemingly endlessly repeating three hour loop of Free to Choose Media‘s documentary Economic Freedom in Action: Changing Lives, followed by To Catch A Dollar: Muhammad Yunus Banks On America.  As I write this, DPTV’s main channel is airing Unlikely Heroes of the Arab Spring, narrated by “award-winning economist, author and property rights activist Hernando de Soto.”

In Current’s annual survey of productions in the works for public TV (dated November 25, 2013) we read:

An extended slate of documentaries from Bob Chitester, the producer who introduced Milton Friedman to public TV viewers in 1980, will bring libertarian perspectives on contemporary issues to public TV stations. The Free To Choose Network, a production house founded by former pubcasting producer and station manager, has eight new programs in the works, several of which are to be released for public TV broadcast next year through Chicago’s WTTW and NETA.

World Channel does carry Bill Moyers and Company, so it’s not a total loss.  Local, USA‘s editorial agenda seems to be a curious 50-50 mix of multiculturalism and social entrepreneurship.  I’m so far on the fence on that one.

Creative Commons Attribution-Share Alike 3.0 Unported

One Korean protestor group with slogan written in Hanja. Photo taken by Wrightbus. The slogan literally means: “End Neoliberalism!” “DOWN! DOWN! WTO” Creative Commons Attribution-Share Alike 3.0 Unported


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De-privatizing the intelligentsia?

David Brin, in a recent blog post, proposes that web browsing software be the locus of implementation for micropayments:

But back to my own obsession. Micro-payments. I have been poking at ideas with others, that boil down to this: we need a way for internet browsers to empower surfers pay a nickel for an article they want to read online. A one-cent or five-cent or ten-cent button that would let any of us hand over a small increment of value for something we choose to use for short time. (I wrote about this in The Transparent Society in 1997.)

Browser-resident payment sounds kind of creepy to me. I’m guessing (but only guessing) that implementing this is inseparable from including digital restrictions management (DRM) in the HTML standard. Unfortunately W3C seems to have caved in to Netflix (among others) and it appears some kind of DRM support will definitely be part of the HTML5 standard. Maybe my knee-jerk suspicion (actually rejection) of DRM makes me one of those clueless cypherpunks, but my cause here is open standards, not encryption (more DRM, of course, means more encryption). I don’t know how developed this idea of browser-based micropayments is. I’d be interested to see a run-down of how it’s supposed to work or an outline of its current state of conceptualization, if nothing else to (hopefully) disconfirm my suspicion that this is yet another attempt to write DRM into the protocols.

I think the future of journalism, if it is to have one, rests not in a more robust business model, but in self-removal from the business sector. Some use the term “intelligentsia” to refer jointly to journalists and educators. The education community (or industry, if you want to call it that) has traditionally straddled the public and nonprofit sectors. This is true of primary, secondary and post-secondary education. In the case of primary and secondary schools, the public school districts are essentially tax-collecting units of local government and the private schools are essentially non-profit organizations. Post-secondary institutions blur the lines between public and nonprofit sectors, as public universities rely on charitable donations for a large share of revenues, and are not generally tuition-free, while private universities rely in large part on taxpayer support in the form of student financial aid and research grants from governments. Recent years have seen aggressive incursions by the for-profit sector into both childhood education and collegiate education. I see this as a bad thing, for a number of reasons, but mainly because I view the body of human knowledge (“the literature,” if you will) as a shared heritage that must never become a commodity. While as a rule I see business as a lesser evil than government in some areas, the intelligentsia-related pursuits of education and journalism are on my short list of exceptions to that rule.

What then of journalism? A lot of the justification for the commercialization of education has exploited the widespread belief that the public financing model of education has failed, by leading to inefficiency, lack of accountability, civil service arrogance, and other supposed ills. The thing is that the for-profit business model of journalism that inevitably boils down either to selling a work product to an audience or selling audience eyeballs to advertisers and marketers, is in a state of failure, and no longer generates enough revenue to support serious journalistic pursuits. So far, the ideas on how to fix this have rested on the assumption that news will be distributed via websites and that like any web content, the key to profit will be monetization. The schemes currently on offer for monetization all appear to me to be pretty shamelessly opportunistic and cynical. To the extent that they involve advertising, it is increasingly the low rent variety, which in online advertising tends to the “weird old tip” genre of ad copy. Since ad blocking is pretty easy in the online world, monetization rests more and more on data mining in service to market research, which I find a little creepy, even though I accept that privacy is a lost cause. The thing that I find most diabolical about website monetization, at least in the case of hobbyist and other otherwise noncommercial websites, is the horror stories I’ve read about the revenues generated amounting to mere pennies, inevitably accompanied by a revenue floor below which the pennies can’t be claimed by their earners.

A better place for journalists, I think, is by emulating the role traditionally played by professors, described a few years ago in some admittedly somewhat cynical TIAA-CREF ad copy as “the greater good.” The problem with monetizing news stories is that in the digital age what you’d be monetizing is not copies of news stories but access to news stories. Once news is DRM restricted or otherwise monetized, there is a question of whether the receiver of the news is somehow bound not to share the text (or audio or footage) of a news story. In the days of printed newspapers, a copy could easily pass through many hands in the course of its date of publication, with portions sometimes living on for decades or even centuries as clippings. Whenever anything digital is monetized, the business model assumes payment on a “per use” basis. This is why many periodicals charge higher subscription rates to libraries than to individuals. If a DRM-restricted reader refers others to a news item, one assumes it will be as a link, probably parsed as a “teaser,” like the aggressive linkspam with text ending in ellipsis(…) that has absolutely swamped Facebook over the last two weeks or so. As Alex Tolley comments on the above-cited blog post (Wikipedia link mine):

One consequence if a micropayment model works, is that we may see more clickbait content as the economic driver is similar to the advertising model from the publisher’s perspective.

One thing I’ve always admired about the academic community is “publish or perish.” It’s an idea that is often criticized because research careers can perish for lack of publishing, which can have the negative consequence of people being drummed out of the profession for what may be political reasons, although it probably also has positive consequences of being a rough approximation of a performance standard. I endorse applying the “publish or perish” concept not (only) to the researcher, but more importantly to the research.negative-data I’m of the opinion that unpublished research (classified and/or proprietary research, as some academic freedom activists have correctly framed the issue) is either not real research, or is research that, instead of advancing the level of knowledge of humanity, turns the history of art, science and technology into a disinformation matrix. In extreme cases it might conceivably lead to a future in which the public is mystified by technologies it isn’t allowed to understand, making of society a cargo cult or perhaps something like Aldean culture.

News is history in the making. If there are not news providers of record (which to me means news content eventually being treated as part of the public record) then society possesses a memory hole. Not just the history of science and technology, but history itself, becomes a disinformation matrix.

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I’ve never run anything other than my mouth

I don’t think it’s any coincidence that “executive” and “executioner” have a root word in common. As no good deed goes unpunished, conversely, there are lucrative rewards for many antisocial acts. There’s a certain school of thought that emerges in a whole range of discussion topics, such as the question of whether one CEO is as valuable to an organization (including, increasingly, nominally nonprofit organizations) as thousands of front line workers, or the question of whether the role played by venture capitalists is actually useful to society, or especially, the bringing in of executive types dubbed “emergency managers” and the like, charged with privatizing, de-unionizing, de-pensionizing, two-tiering, or otherwise humbling the economic expectations and breaking the sense of self-worth of people involved in the provision of public services. “Someone has to make the difficult/unpopular decisions,” say the Very Serious People, as if unpopularity (more precisely, antipopulism) is the very definition of leadership.

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Deleted “No More Sunsets” from blogroll

Seems the blogspot address of that blog has been taken over by a spamblog.  A similar thing happened to “Polycentric Order.”

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