Tuesday, July 12, 2005


Apologists for capitalism like to lay claim for all the good things developed during the last 200 years. Wouldn't have happened without capitalist entrepreneurs, they say. And this is the reason that these entrepreneurs must be rewarded with colossal salaries and patent monopolies.

Trouble is, with this happy scenario, is inventors don't invent to become fabulously wealthy. There are legions of garage and basement-based inventors, and none of them are rich. Some like Edison and Ford do become rich, but in the beginning they weren't and yet they still invented. Inventing is their art, and like artists they will do so whether they are financially rewarded or not.

While financially successful inventors become capitalists as a matter of course, few inventors are themselves capitalists to begin with. The most common source of invention in the 19th and early 20th Century was the skilled worker. Edison and the Wright Brothers are the prime examples. Morse, Fulton, and Ericsson were artists. Watt an instrument maker. Edison a railway telegrapher. Kelvin, DeForest, (radio) Farnsworth, (TV) Bell, Faraday, Davie were scientists. Eastman (camera) an office clerk. Ford, and Howe (sewing machine) were machinists. Cyrus McCormack was a farmer.

Note that all great inventions are connected with a person's name. Inventions are made by individuals (Or two brothers as with the Wright Brothers and les freres Lumiere) and not by corporations. Corporate capitalism invents nothing. It might buy out someone's idea, or adapt an existing concept, but produces nothing new. Corporations develop ideas, but in a bureaucratic fashion. This explains the poor quality and impracticality of so much contemporary design. (1)The old inventors were practical people trying to find the simplest and most workable solution to a problem. The bureaucrats are merely looking for a marketing angle or a way of cheapening the cost, to which they will cheerfully sacrifice design.

Capitalism, and this is well known, suppresses inventions if they harm profits. Way back in the 1830's steam powered buses were running across England. The coaching industry and railways crushed the steam coaches by getting Parliament to enact the infamous "red flag law".(2.) Nicola Tesla found a way to transmit electricity without wires, his backer, J.P. Morgan, pulled the plug on him and a campaign of slander against Tesla was launched in the newspapers. A tacit agreement among the Big Three auto manufacturers in the US put the revolutionary Tucker car out of business.

Apologists for the corporate system claim that capital's promotion through advertising and large scale production brings new improved goods to the masses and as a result brings the price down. But people know a good thing when they see it and don't need to be propagandized into buying something. No mass advertising was necessary to switch from flint and steel to matches, or candles to coal oil lamps and then to electricity. Advertising is mostly a way of getting people to buy what they don't need or to get a larger share of the market for a product that is in no way different from that of the so-called competition. (Think of Coke vs. Pepsi)

While it is true that an economy of scale is needed to produce complex goods like aircraft, automobiles and large ships, it really doesn't apply to most items and services. (3) Does the world really need and benefit from multinational corporations frying hamburgers, brewing beer, baking bread, manufacturing cheese, bottling soft drinks, or providing janitorial services? I think not. The quality of these goods and services is usually much better when delivered by small or local firms. If you want good beer you buy from a microbrewery not Molsons or Coors. Good bread is only found at local bakeries, mass production bread is only fit for pigs. MacDo burgers are crap and Kraft cheese has no taste.

1. Things have gotten insanely and unnecessarily complex. Why should you need a manual to operate your car radio-CD player? Why did they abolish the on-off switch for cell phones and pagers? Why are "help menus" so unhelpful?
2. The law by which any "horseless carriage" had to be preceded by a man bearing a red flag. This law, which wasn't killed until 1896, effectively gave France and Germany a big head start in the auto industry.


Blogger freeman said...

I always found the claim that capitalism is reponsible for so many inventions to be an odd one, it just doesn't make sense to me.

And, of course, such claims are always made by apologists who wish to equate capitalism with greatness. Well, wasn't the printing press invented during feudalism? Should we praise feudalism for this positive development in human history?

Individuals are responsible for inventing things, not large bureaucratic institutions (governments, corporations) and not economic systems.

8:59 PM  
Blogger Kevin Carson said...

Great post, Larry. The ref to the Tucker reminded me of another story I read in the Nader Group's book on industry concentration: the Big Three agreed in the late 1950s that none would introduce turbine engines until all three were ready to do so.


There's a book by Jean Gimpel, The Medieval Machine, arguing that most of the technical prerequisites for the industrial revolution had been developed either by craftsmen in the free towns of the High Middle Ages, or in the monasteries. Chesterton and Belloc argued that the steam engine would have been introduced into production in a distributist economy, had enclosures and suppression of town communes never happened. But the democratic guilds would have been the main means of organizing investment funds, and it would have been worker-owned and -controlled industry from the outset.

7:08 PM  

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