legal theory: law and economics

Economic Analysis Leads to Commodification

 

Thinking this way, talking this language, reinforces our regrettable tendency to view and treat all objects, relationships, and conditions as presumptively subject to exchange. The vocabulary of economics (at least the types of economics commonly employed by legal scholars) inclines its users to think of all resources and entitlements as commodities. Except in rare circumstances, everything, it appears -- babies, sex, blood, kidneys, clean air, the ability to have children or an abortion, privacy, and the right to equal treatment before the law should be tradeable.

What is wrong with such an orientation? Margaret Jane Radin summarizes as follows the strong case against commodificiation (before going on to develop her own more complex analysis):

[T]he hegemony of profit-maximizing buying and selling stifles the individual and social potential of human beings through its organization of production, distribution, and consumption, and through its concomitant creation and maintenance of the person as a self-aggrandizing profit- and preference-maximizer. . . .

1. Alienability and Alienation: The Problem of Fetishism. -- For critics of the market society, commodification simultaneously expresses and creates alienation. The word "alienation" thus harbors an ironic double meaning. Freedom of alienation is the paramount characteristic of liberal property rights, yet Marx saw a necessary connection between this market alienability and human alienation. In his early writings, Marx analyzed the connection between alienation and commodity production in terms of estranged labor; later he introduced the notion of commodity fetishism. In his treatment of estranged labor, Marx portrayed workers' alienation from their own human self-activity as the result of producing objects that became market commodities. By objectifying the labor of the worker, commodities create object-bondage and alienate workers from the natural world in and with which they should constitute themselves by creative interaction. Ultimately, laboring to produce commodities turns the worker from a human being into a commodity, "indeed the most wretched of commodities." Marx continued:

The worker becomes an ever cheaper commodity the more commodities he creates. With the increasing value of the world of things proceeds in direct proportion the devaluation of the world of men. Labour produces not only commodities; it produces itself and the worker as a commodity -- and does so in the proportion in which it produces commodities generally.

Commodification brings about an inferior form of human life. As a result of this debasement, Marx concluded that people themselves, not just their institutions, must change in order to live without the market. To reach the post-capitalist stage, "the alteration of men on a mass scale is necessary."

The fetishism of commodities represents a different kind of human subjection to commodities (or a different way of looking at human subjection to commodities). By fetishism Marx meant a kind of projection of power and action onto commodities. This projection reflects -- but disguises -- human social interactions. Relationships between people are disguised as relationships between commodities, which appear to be governed by abstract market forces. I do not decide what objects to produce, rather "the market" does. Unless there is a demand for paperweights, they will have no market value, and I cannot produce them for sale. Moreover, I do not decide what price to sell them for, "the market" does. At market equilibrium, I cannot charge more nor less than my opportunity costs of production without going out of business. In disequilibrium, my price and profit are still set by "the market"; my price depends upon how many of us are supplying paperweights in relation to how many people want to buy them and what they are willing to pay for them. Thus, the market value of my commodity dictates my actions, or so it seems. As Marx put it, "[producers'] own social action takes the form of the action of objects, which rule the producers instead of being ruled by them."

In an analysis that has profoundly influenced many contemporary anticommodifiers, Georg Lukacs, developing Marx's concept of commodity fetishism, found commodification to be "the central, structural problem of capitalist society in all its aspects." Lukacs linked the trend to commodify the worker with Weberian "rationalization" of the capitalist structure. The more efficient production becomes, the more fungible are the laborers. Moreover, fungibility becomes pervasive:

[T]he principle of rational mechanisation and calculability [embraces] every aspect of life. Consumer articles no longer appear as the products of an organic process within a community (as for example in a village community). They now appear, on the one hand, as abstract members of a species identical by definition with its other members and, on the other hand, as isolated objects the possession or nonpossession of which depends on rational calculations.

These falsely objectified commodities are said to be reified. According to Lukacs, reification penetrates every level of intellectual and social life. False objectification -- false separateness from us -- in the way we conceive of our social activities and environment reflects and creates dehumanization and powerlessness. The rhetoric, the discourse in which we conceive of our world, affects what we are and what our world is. For example, Lukacs thought that the universal commodification of fully developed capitalism underlies physicalist reductionism in science and the tendency to conceive of matter as external and real. He thought that universal commodification also underlies both our rigid division of the world into subjects versus objects ("the metaphysical dilemma of the relation between 'mind' and 'matter'"), and the "Kantian dilemma" that places objective reason, purportedly the foundation of metaphysics and ethics, in the noumenal realm forever beyond our reach. For Lukacs, thought and reality are inextricably linked.

One need not accept all aspects of Marx' and Lukacs' critique to believe that contemporary Western culture has moved too far toward commodification -- that we think of too many things as tradeable. Economic analysts of the law almost never argue for narrowing the zone of entitlements subject to market exchange and often argue for expanding that zone. To that extent, their method is pernicious.

Rebuttal.