Look: I am eager to learn stuff I don't know--which requires actively courting and posting smart disagreement.

But as you will understand, I don't like to post things that mischaracterize and are aimed to mislead.

-- Brad Delong

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Everything that appears on this blog is the copyrighted property of somebody. Often, but not always, that somebody is me. For things that are not mine, I either have obtained permission, or claim fair use. Feel free to quote me, but attribute, please. My photos and poetry are dear to my heart, and may not be used without permission. Ditto, my other intellectual property, such as charts and graphs. I'm probably willing to share. Let's talk. Violators will be damned for all eternity to the circle of hell populated by Rosanne Barr, Mrs Miller [look her up], and trombonists who are unable play in tune. You cannot possibly imagine the agony. If you have a question, email me: jazzbumpa@gmail.com. I'll answer when I feel like it. Cheers!

Tuesday, April 5, 2011

The Brute Economics of Slavery

Late update:  If you happen to read this post, be sure to also read the comments.  They are enlightening.

In thinking about the economics of slavery, I'm considering slavery and serfdom to be economic near-equivalents. Of course, I recognize that there are qualitative differences between chattel-slavery and serfdom:

-  In slavery, the master owns the person of the slave; in serfdom the master owns the labor output of the serf, either as a stated labor quantity, a stated output quantity, or some combination.

-  Serfs enjoy some measure of freedom, and can accumulate personal wealth, after the rents are paid; slaves do not and cannot.  (The point, though is to keep rents so high that accumulation is prohibitively unlikely.)

-  It might be easier to gradually and incrementally impose serfdom on an existing population. First generation slaves need to be captured, conquered, or in some other way removed from - and deprived of - their native state. Thus, serfdom is imposed on the indigenous population, slaves are more typically imported.

-  The individual slave is a depreciating asset.  But, as a population, slaves are self-renewing, since, unlike Shakers, they reproduce.   Serfs are factor inputs rather than assets.  (On the other hand, the master also owes the serf protection, and sustenance in times of famine.  In that sense, the serf resembles an asset that requires maintenance.)

These are significant differences, to be sure, but mostly from a sociological or political perspective.  In terms of the brute economics, they are somewhere between second order and trivial.

The necessary conditions for reducing a population to serfdom are as follows.

- A large wealth and power disparity between the haves and the have-nots.

- Perhaps more significantly, the ownership of virtually all assets by an elite class, with severely limited opportunities for the general population to own or accumulate assets.

- A poorly educated population with limited skill sets.

- Severely impaired individual mobility, due to an impossible debt and/or tax burden and legal restrictions.

- Government of the masters, by the masters, for the masters, with little or no sense of worth or justice for the serfs.  This enforces and reinforces the previous point.

- A social and/or religious system that recognizes the inherent meritocracy of the master class.

- A population that is scared or coerced into ceding their freedom to the masters in exchange for security.

- The political will to deprive people of their fundamental human dignity.

Via Krugman, we find Delong's repost of a short treatise on slavery and serfdom by Evrey Domar.

Domar points out additional requirements, and a mechanism for serfdom to develop.

- Low population density: Labor scarcity favors slavery/serfdom, since the cost of freeman labor will be high.  I'll admit I didn't get this until is was stated the other way around.  Population growth favors freeman labor since the competition for jobs drives wages down.  (Note the implicit denial of the "Lump of labor fallacy" canard.)

- A large class of what Domar calls "servitors" who owe allegiance, taxes, and military support to a higher authority.  They are the equivalent of medieval vassals of a liege lord, who extract from the local peasant population not only their own means of existence, but that of their liege, as well.   This is the beginning of, and most literal sense of "rent-seeking."  The process is that, starting with a free population, by taxation or other forms of indebtedness, the freedom of the common people is eroded.  Those whom Domar calls "servitors" I call leaches.

- Explicit Government complicity in restricting mobility, via legal structures. Besides limiting the population's mobility in a gross sense, it also eliminates the possibility of competition among different servitors.

In this way, serfdom developed in depopulated* Western Europe during or after the late Roman Empire, and in Eastern Europe many centuries later - in fact, long after serfdom has disappeared in the West.  In each case, the critical enabling factor was low population density, resulting in a critical shortage of labor.

Basically, it comes down to an economic evaluation of costs and returns.   But these are not easy to determine with any precision in the abstract, and probably not in the actual event, either, unless the increment is quite large.  The slave, and even the serf, needs maintenance in a way that the free laborer does not.  The serf can be compelled to work past his willingness in way that the free man cannot.  On the other hand, the free man might have higher willingness and unit productivity.  The wild card here is what the free man can demand as wages, and that depends on the competition for available jobs.  The bottom line is that serfdom will dominate whenever the profit (revenues less costs) of keeping a serf is greater than that of hiring a free laborer.

Of course, all of this was long ago - pre-industrial revolution in fact, and centered on a low-technology agrarian system.  What message does it have for us today?   Here, Krugman wonders** why, after the the plagues of the mid-14th century, serfdom wasn't reestablished in Western Europe, since the population was greatly depleted.  Domar has no clear answer, and Delong won't hazard a guess. I will -- but it's only a guess.  Perhaps society had moved on, and the culture was no longer accepting of serfdom as a social institution.  Serfdom had faded away from lack of interest and due to population growth many decades before the plague epidemics occurred around 1350.  There were sufficient numbers of artisans, craftsmen, guilds, merchants, and bankers, such that tying people back to the soil might not have been easy, or even desirable.   The growth of towns might have played a part.  Another social factor is that in late Eastern European serfdom, the servitor's status was determined by the number of serfs he controlled.  I don't think that was ever the case in the West.  Sometimes social factors trump economics.

Also, as Barbara Tuchman points out in A Distant Mirror (Ch 11, frex.), though the population decreased due to the plague, total wealth in coins and material possessions did not, and they were largely in the hands of the elite.  It could be that with this wealth maintained, the brute economic drive for serfdom was absent, or severely attenuated, despite the labor shortage.

Krugman also wonders: "And an even bigger question: why hasn't indentured servitude made a comeback in the modern era? Yes, I know, human rights and all that - but if it was profitable to have indentured servants in the modern world, I'm sure that Richard Scaife's think tanks would have no trouble finding justifications, and assorted Christian groups would explain why it's God's will."  

Well, that was in 2003, when Scaife was well known and the Koch brothers weren't. This statement also gets a lot of ridicule in comments at Delong's Domar post. But, there were certainly many Christian apologists for slavery, and you can see today that tea-baggers and the Christian Right do not exactly align themselves on the side of human rights vs the brute force of the elite.

So Krugman's question remains, hanging over us like the sword of Damocles.  Here is the way I see it. First off, you need to be skeptical about translating a socio-economic phenomenon from a different place and time to the here-and-now.  Our population is not sparse nor badly educated (yet), and we do not have a pre-industrial agrarian economy.  But these differences effect the possibilities and modes of implementation.  They don't effect the ongoing defects of human nature that Krugman obliquely alludes to.  These are greed, ego, and the lust for power, and you can see them manifesting themselves right here in the U.S. today in the struggle between labor and the minions of the wealthy elite. When I think about serfdom, I also think about more modern analogs - sharecroppers, coal miners who owed their soul to the company sto'e, child laborers in early industrialized England, indentured servants, the exploitation of illegal immigrants, and the union busting practices that have been highly successful here since 1980.

In evaluating the conditions that favor and disfavor serfdom as such, something is missing from the analysis.  That is that somewhere along whatever spectrum of conditions makes serfdom more or less economically favorable to the elite, there is a point (or region) of indifference.  If working people are reduced to the point where the economics are no less favorable to the elite than serfdom, then actually going through the formality of making them serfs simply isn't worth the effort, and doesn't make any economic difference.

What do we have today?

- The largest wealth disparity since before the great depression - at every stratum of society, growing larger every day.

- An all out assault by the moneyed elite on the wealth and status of working people.   Union busting is one of the tools.

- Deliberate undermining of public education.

- Segments of the population tied to the land by under-water mortgages or the inability to unload a property.

- Popular social movements with religious backing that favor the interests of the elite over the interests of the people.

- Constant fear-mongering as a pretext for inducing people to give up their basic rights.

- A moneyed elite that effectively owns government.

Krugman's apparent underlying assumption, which I share, is that - for the servitors at least, and possibly for the serfs as well - serfdom is a strategy of least resistance, and therefore the default social order, whenever the conditions for it are right.

One of the things that can make conditions not right for serfdom is regulated entrepreneurial capitalism - inventiveness, innovation, industry, and real competition.  Capitalism generates wealth, increases wages, opportunities and the standard of living, and reinforces concepts of freedom, liberty, and fair practices.  Effective regulation assures that fair practices are maintained, keeps the playing field even, and increases the likelihood that reward is in some way proportional to a combination of skill and effort.  Capitalism is expansionist by nature, serfdom is static.

Unfortunately, over time, capitalism transmogrified into Corporatism.

Corporatism, for all its acquisitiveness, is a very different phenomenon.  Ownership is remote.  Assets are used in large part for executive bonuses, dividends, and mergers and acquisitions.  Though the track record of M&A in meeting stated goals is dismal, the real net effect is monopolization - corporatists hate competition.  Corporatism seeks always and everywhere to decrease wages, and is utterly indifferent to the living standards, freedom, and opportunities of anyone outside the elite.  Ethics and fairness are non-existent.  Rewards are in proportion to rapacity.  In other words, Corporatism is the new feudalism.

This is why I say that the goal of the Rethug party, as servitors to Scaife, the Koch's and their ilk, is to take us back to the 12th century.  I've stated that trans-national corporations with no loyalty to anyone or anything constitute the real road to serfdom, in contradistinction to what Hayek said.   That is a bit inaccurate, though. Once wage scales are reduced to the par value of slave maintenance, it doesn't matter what the correct technical description of our condition is, and the elite won't care.

So - are we screwed, or what?!?

__________________________________________________
* Antonine Plague of 165-180, Cyprian Plague of 250-270, Justinian Plague of 541-2
** The link to the Surowiecki article that Krugman mentions is broken.  It can be found here.
.

13 comments:

BadTux said...

One of the things that the apologists for slavery in the 1850's were fond of pointing out is that conditions for "free" laborers in the factories of the North were even more horrific than conditions for slaves in the South. Slaves were a valuable commodity and had to be treated that way, with housing and working conditions that at least kept them healthy, albeit probably not comfortable. The industrialists of the North, on the other hand, viewed their workers as replaceable machines. There were always more Eastern Europeans debarking at Ellis Island to be pressed into service, so worker safety was not of concern -- if a worker became injured, there was always another Bohunk to take his place. And what of the discarded worker? Not a concern of the industrialists. Let him go to the poor houses or die of "natural causes" (starvation is natural, right?).

Of course, the fact that the system in the North in the 1850's was horrific did not make the system of slavery in the South any less horrific, but does exemplify your point about labor shortages making outright slavery (or serfdom - slavery lite) the preferable system. You likely have never worked outdoors in the South in the summertime. I have. It is brutal. It is not something you do voluntarily. Free laborers typically didn't hang around the South long before heading West or North to get to a more agreeable clime. Those who say slavery would have died out naturally disregard that fact. The sharecropping system which replaced slavery after the Civil War and lasted until WWII was far less profitable, because to get people to stay on the lands, the plantation owners had to give them a far larger share of their output than was typical prior to the Civil War, it was serfdom, but a somewhat less restrictive serfdom than the Eastern European variant. But still, WWII utterly destroyed that system because once the majority of the serfs had gone to Detroit or Los Angeles to work in the war factories, they had absolutely no inclination to go back home again.

By contrast, the majority of immigrants entered in the North, and thus there was an ever-replenishing supply of factory workers to be used, abused, and discarded. Those who picture an idyllic America in the mid-19th century seem to disregard this Hobbesian reality of life in that era being nasty, brutish, and short for far too many, regardless of which system you were entwined within.

BadTux said...

[continued... darn blogger limits!]

Of course, there was always the option of setting out for the frontier then, if you managed to accumulate sufficient assets to make the journey rather than die along the way. The frontier served as a safety valve to the abuses of the Gilded Age in the North. It was the closing of the frontier, more than anything else, which led to the labor unrest at the end of the 19th century that led to the first Progressive era in American politics...

But that was then. Today, we have the most efficient police state in the history of the planet here in the United States. In the 19th century, a labor organizer could go into a factory and organize without the knowledge of the factory owners. Today, he would be required to submit his social security number and date of birth, and a credit report and background check would quickly reveal that he was a union organizer and he would never make it to the factory floor. In the 19th century, an average person could participate in a labor strike without fear of identification or repercussions, if you said your name was Jebediah Ezekial, who was to say different? Today you are required to carry your national ID card ("driver's license") which is photographic evidence of your identity, and are fingerprinted, processed, put into the computer, and forever marked by anybody who does a background check as an "agitator" and thus someone not to hire. The power of computers has changed the equation forever... and thus far, it has mostly been in the favor of the employers, who now find ways to track us and punish us for "undesirable" behavior that their predecessors in the first Gilded Age could only dream of. For now.

- Badtux the Historical Penguin

The Arthurian said...

Hi, Jazz. Interesting topic.
Under Diocletian, as I recall, came a law that sons had to take up the same work as fathers. The law was intended to assure continuity and stability of supply. But it ended up binding people to tasks in a way that contributed to serfdom.

Impressions:
1. The rise of serfdom, going in to the dark age, was comparable to trends we see today.
2. The rise of feudalism, coming out of the dark age, was the beginning of a re-establishment of order. The long, slow drift back toward a money economy began not long after.

"The bottom line is that serfdom will dominate whenever the profit (revenues less costs) of keeping a serf is greater than that of hiring a free laborer."
Not so sure. Implicit in your statement is something I agree with absolutely: everything moves toward profit. But late in the cycle of civilization, with wealth highly concentrated, the notion of profit itself may take on new meaning.

At BadTux you commented: "This is where we've been heading since 1980."
I like to emphasize that the conditions we have come to over the past 30 years are (as you suggest) the result of policy. But the most vocal opponents of current conditions don't seem to notice.

ArtS

Anonymous said...

long winded eh?

well, April to December is kind of traditional.

you may not have known that Romans sold themselves into slavery.

kind of like Americans who are willing to give up social security in return for a "tax holiday."

coberly

Jazzbumpa said...

Dale -

This was a meaty topic, and I wanted to be thorough. There isn't any fluff, and I wasn't prolix.

I guess we're disagreeing about vocabulary again.

I can't say I had any specific awareness of Romans selling themselves into slavery. (What would they do with the proceeds?) It doesn't surprise me though, and I talked about the security and stability the slave/serf gets from the master. It beats than being flayed alive by barbarians.

I agree with you that the payroll tax holiday is one of the worst ideas ever. But you are severely over-reacting with your analogy.

Cheers!
JzB

Loquat said...

According to Wikipedia, Romans could not in fact sell themselves into slavery due to the potential for fraud, but they could sell their children.

Ancient Israelites could sell themselves into slavery, generally as a means of discharging debt though people in extreme poverty might sell themselves as well to avoid starvation. Of course, in these cases it wasn't meant to be slavery in perpetuity as all such slaves were supposed to be freed when the next jubilee year rolled around.

Jazzbumpa said...

loquat -

Thanks for the additional detail.

Cheers!
JzB

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