Capitalism needs mechanisms for humility in valuations
When I talk about our world needing to be anticapitalist and prosocial, I am not throwing out all the lessons of the market or even money per se. I primarily see two things that need to change:
- our arrogance in valuation of any good or service, especially natural
- our operating understanding of human nature, which is incoherent
These are my thoughts on the first change.
Capitalism runs on shared assignments of value that occur through the unending transactions that we call "the market", right? And it is very effective at this, as economics freaks are quick to point out: an equilibrium between supply and demand of a widget is always reached. Congrats economists, you found a thing.
What this model of exchange fails to account for is massive, societal miscalculations of value. It is constantly running on an anchoring bias. Today's corn prices are determined largely by yesterday's corn prices, but there is no mechanism under capitalism to account for if the price of corn yesterday, or the year before, was missing some big fundamental factor.
Some people might rebut that the mechanism for these kind of large scale corrections is market failures—or crashes— which occur so frequently as to be almost predictable. I reject that as a suitable answer to the real question underneath how do we better price goods and services, which is how should we exchange things to benefit everyone? (If you disagree with this question I have words for you in my article about the first of my two things that need to change.) While I understand that there is some truth that market crashes are a correction for miscalculations or malpractices of valuation, even those crashes do not alleviate some of the longest-running miscalculations of value in the economy, and therefore do not alleviate the arbitrarily unequal distribution of some vital goods.
There are many examples of the kind of never-corrected errors in valuation. Slavery, fossil fuels, land prices, plastics. Yes these things do get better sometimes, but they're improvement has nothing to do with valuations "balancing out over time". In fact, each of these examples gets worse when the valuation of goods and labor is left up to the market.
Capitalism, as a macroeconomic platform, incentivizes everyone inside it to suppress acknowledgement of true value and true cost of things.
We need to get past this epoch of human exchange. In order to do so, we need to deeply understand how incalculable the value and cost of everything is, both natural and human-made. This is the existential humility of value.
And acknowledging it does not bind us to inaction. Building a home on this ground erases resources, space, history. It provides an innumerable number of benefits for its occupants and their neighbors. You can still build the home after acknowledging the scope of that act. Embracing an existential humility of valuation means continually trying to map out as many of the infinite ways in which a good or service is both valuable and costly to the earth and all its inhabitants as you possibly can.
Capitalism, by its architecture, tempts us to blind ourselves to values and costs that are painful or dizzying to calculate. But we must try.