‘Oh my God. I’m back. I’m home. All the time, it was… We finally really did it.
You Maniacs! You blew it up! Ah, damn you! God Damn you all to hell! ‘
The Destruction of Creative Destruction
The term Creative Destruction has come to be associated with neo-liberal economics but it comes from Karl Marx, the unacknowledged father of modern ‘right wing’ thought. Marx is sometimes accused in historical biography of fathering an illegitimate son. Whether this particular accusation stands up or not, the famous Germanic features of The Moor can clearly be seen in the lineage of Monetarism and Neo-Liberalism.
Marx coined the term ‘creative destruction’ to describe the ceaseless process whereby Capitalism consumes everything that it creates; previous methods, institutions and even capital itself are burned up to make way for a new cycle of expansion and growth.
The phrase was adopted by Austrian/American economist Joseph Schumpeter:
‘Capitalism […] is by nature a form or method of economic change (…) that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one. This process of Creative Destruction is the essential fact about capitalism. It is what capitalism consists in and what every capitalist concern has got to live in.’
Schumpeter was forced to draw sombre conclusions about the future of capitalism as a result of his observations. Since like a frenzied shark, capitalism could and would eat even its own entrails when circumstances allowed it, how could even the most fundamental aspects of the system be guaranteed to stay in place?
This proved to be Marx’s irrefutable argument. If capitalism does indeed develop by a means of creative destruction, does that not make it inevitable that in the end it will consume the very fabric of the system itself by a process of destructive cycles?
After all, the observation that all societies finally collapse is a piece of accepted wisdom that far predates Marx. Marx’s achievement was simply to describe how collapse would happen this time around.
It’s A Mad, Mad, Mad, Mad, World.
Around the time that creative destruction was entering the modern lexicon another phrase was becoming popularised; M.A.D. or Mutually Assured Destruction based on the idea that the Soviet Union and America would never launch all out thermo nuclear war because it would result in both countries being effectively destroyed. In an incredible leap of something, it was widely accepted that this meant that balance had somehow been reached and that this balance somehow rested upon logic.
But this is not what MAD suggests at all. What MAD suggests is that Russia and USA WILL INEVITABLY destroy each other. What MAD suggests is that being diagnosed with a terminal condition puts your winter cold in perspective. MAD suggests is that there is some small comfort in knowing HOW you finally buy the farm before it actually happens. MAD is a form of, well, controlled madness.
The implications of MAD are that once Russia and America went down this path they sealed our fate. We are living in a bubble of time before inevitable destruction comes.
The threat of thermo-nuclear annihilation and recognition of the essentially destructive nature of capitalism give rise to a sense of profound foreboding in western thought and by extension, western popular culture. This foreboding finds popular expression in apocalyptic books and movies.
If not the last, then perhaps the next to last word in such literature is ‘The Road’ by Cormac McCarthy; a work that could as fairly be called ‘postal’, (in the modern American sense of the word), apocalyptic as opposed to post apocalyptic. The book, the audiobook and even the film can be found on the Internet and I would heartily recommend that you seek out all three, but with the gentle warning that this is ‘family’ entertainment in the sense it is about family, rather than the traditional Hollywooden sense of the phrase.
All dramatic constructions have an inflection point and in the film adaption of The Road, the crucial expository scene is carried by the considerable presence and acting skill of Robert Duvall. Duvall’s character is only onscreen for a relatively brief time, but his wonderfully understated dialogue lays the basis for the whole narrative. Staring through the flickering flames of a campfire with milky cataract occluded eyes ‘Ely’ tells us that: (I paraphrase)
‘We knew this, or something like it was coming for a long time’
Which links us in the here and now with the terrible twisted landscape we see before us. But even as we watch the screen and accept that we have this terrible foreknowledge, Ely tells us we are effectively powerless;
‘Even if you knew, what could you do to prepare for this?’
And it is true that destruction on the scale of ‘The Road’ would make even the most comprehensive of preparations look irrelevant. So is this Ely’s and our awful fate; to move towards disaster, fully conscious and yet be unable to do anything to change our destiny?
There is the old Irish joke of the tourist who is wandering round the roads out in the countryside and happens upon a local man. The tourist asks for directions:
‘Excuse me, can you tell me the way to Limerick?’ asks the tourist
The Irishman ponders for a short while and then says
‘Well, I wouldn’t have started from here’
This story bears a little scrutiny. First there is the simple joke that illustrates the Gaelic way of gently telling the man he is a fool, that he is lost and he should not even be out here. But as so often with Gaelic humour there is another deeper (blacker), joke wrapped up within a joke. The real, deep humour is that the tourist would never for a moment consider going back to where he came from and starting his journey again. Because that is his nature. That is why he got lost in the first place.
Which brings us back to the road we are presently travelling and creative destruction.
Risk we are told, is integral to the healthy functioning of the capitalist system. Without risk there would be ‘moral hazard’. Destruction of your enterprise and the fear of destruction of your enterprise is what keeps you honest and efficient. However, by the same token, overcoming risk and its effects is integral to risk management. Risk management exists precisely to offset the effects of risk that is a constant threat to all capitalist enterprises.
With all the time and effort that has been expended on risk management in the past five decades, is it so unbelievable then that a method should finally be devised by these enterprises to remove risk from their day-to-day activities. ?
Isn’t this so? That effectively there is no meaningful risk involved in the operation of the biggest enterprises?
Creative destruction we are told is an integral part of the capitalist system and has been part of that system since it first ‘appeared’. But was it not inevitable, that since every aspect of capitalism is destroyed by its successor, that one day ‘creative destruction’ itself would be destroyed?
Isn’t that what has happened since financial institutions have been declared ‘Too Big To Fail’? And are these same institutions now not bigger and more concentrated forms of economic and political power than when the crisis started?
Crackernomics tells us that either
The system is basically sound and that what we are seeing is somehow the result of aberrant criminality
Or that what we are witnessing is somehow a natural phenomenon like a sandstorm or a tidal wave but that either way the system is sound and is the only viable option we have.
Crackernomics never invited the Crackers to consider whether they should not tear up the topsoil on the Great Plains, held in place by a delicate eco-system that had adapted for thousands of years to maintain the system in balance. It told them that this is the right and only thing to do. It told them to Stay On The Road they had set out on.
That we have come too far to go back now.
And when the great dust storm appeared on the horizon like the Wrath Of God the Crackers stood, although now blinded, finally able to see what had been staring them in the face all the time.
“Now I am become Death, the destroyer of worlds.”
May the road rise up to meet you….