When P. J. O’Rourke writes in praise of the economist Joseph Schumpeter’s capitalist notion of ‘creative destruction’ – such as the dynamics of the free market replacing the company that builds faulty washing machines – he seems to imply a ‘one system fits all’ approach to virtually every situation:
The amazing thing about free-market capitalism is that it gets rid of stuff that doesn’t work. You say, “Amazing? When stuff doesn’t work, of course you get rid of it!”
If you’ve got a washing machine and – no matter how many times the supposedly lonely Maytag Man has been to your house – it just can’t be fixed… do you keep piling dirty clothes into it? You’ll run out of things to wear.
No, you haul the old appliance to the dump and acquire a new one. This is what free-market capitalism does with businesses. When a business is no longer profitable, investors dispose of it and put their investment capital into another business that does (or will, investors hope) make a profit.
(Which is pretty much what happened to Maytag – the brand name bought by Whirlpool and practically everybody at the Maytag company fired.)
This is – sorry, Maytag employees – common sense. And common sense is really all there is to the free-market capitalist system.
But there are other systems… systems that don’t involve common sense in the use of capital, systems that spend money in strange and silly ways.
Of these systems, the biggest is big government, with its ethos of “If it works, tax it… If it doesn’t work, subsidize it.”
When the government has a broken washing machine, it breaks the dryer to ensure job security for the Maytag Man, then funds a grant program for free clean t-shirts.
(P. J. O’Rourke, American Consequences, June 2019,(https://americanconsequences.com/schumpeters-creative-destruction/) )
I suppose the same thing could be said about gas chambers used in genocide. If the machinery isn’t doing the job, you look for another production line. But clearly there is another issue here, one that is a very different type, one that an economic calculation is not designed to address.
The company that replaces Maytag may address the supply-and-demand need to provide consumers with washing machines that will dependably do the job. But taking into account the plight of the workers, who are now out of a job, is a different matter.
When it comes to the well-being of workers caught up on the free market currents of ‘creative destruction,’ apparently it is not the mandate of O’Rourke’s brand of capitalism to offer any solutions. Whether it is the rightful role of government to step in at this juncture is a social and political calculation. Granted, even if it should be the responsibility of government, there is the practical matter of whether government is up to the job. If a particular administration is not succeeding at that task, the political version of ‘creative destruction’ is presumably the ballot box.
Two things might be said here.
The question of where the mandate should fall to address the needs of those who fall by the wayside when it comes to any aspect of society and the systems at work is a legitimate one. This is an appropriate question of means. I happen to believe that any systemic approach is going to be imperfect. The public and private sectors each have their roles to play. It will always be a work in progress.
But the more pressing question is whether there is a mandate at all. This is the matter of ends. Given the nature of economic and political systems as social constructs, that mandate is not going to come from the systems themselves. It is going to have to come from somewhere else. There are going to have to be other considerations taken into account. The society that has created these constructs will have to appeal to other forms of common sense.
Such as: are there certain human problems that will be neither addressed, or solved, without empathy?