Preproceedings 2006 - Austrian Ludwig Wittgenstein Society

56
An economist’s reflections on some recent trends in European culture. - Y.S. Brenner
There is, however, a cultural aspect of this
economic process why neither the technological
achievements of the last decades nor the new markets
opened by the disintegration of the communist block and
the accelerated economic growth of China and India, can
break this vicious spiral by which the western economic
progress is slowly grinding to a halt. This is the spreading
of a new culture I call industrial feudalism. As already
mentioned, 24 the position in the social hierarchy of the old
Captains of Industry, the owner-managers, was
determined by their wealth. Their wealth reflected what
was taken to be evidence for their economic sagacity, and
the manner in which they displayed their wealth reflected
their social standing in the eyes of their peers. The new
"Captains" of large enterprises are managers whose
personal wealth and attainment are less directly tied to
their businesses' profitability, and their social position is no
longer subjected to a culture of noblesse oblige. 25
Controlling large funds which are not their own, the
members of this new elite are less careful than their
forebears to avoid unnecessary costs when this can
strengthen their personal prestige. Provided such
expenditures can be correctly booked as business costs,
or tax deductible, they will be incurred regardless of
whether or not they are really necessary for the business.
Wealth continues to bestow numerous advantages on
those who own it, and company profits remain an
indispensable necessity, but the role of salaries and profits
is reversed. Not current business profits but the height of
his personal remuneration reflects the manager's status.
This means that the new utility-maximizing "Captains of
Industry" no longer resemble Adam Smith's profit-seeking
entrepreneur who is willy-nilly promoting business
efficiency, but an individual who constantly weighs his own
against the enterprise's best advantage. 26
Worse. Since the late Middle Ages Capitalism developed
in the shadow of the bourgeoisie’s efforts to obtain equal
status with the aristocracy. This was already amusingly
illustrated in the seventeenth century by Moliere in his Le
Bourgeois gentilhomme. It imposed upon the rising
bourgeoisie a modicum of civilized behaviour in order to be
regarded genteel – in order to appear socially of a high
class. Whether or not the Aristocracy ever lived by the
romanticised mode of conduct the bourgeoisie ascribed to
it, is beside the point. It imposed certain rules on a
bourgeoisie which was trying to emulate their betters. It
required individuals to be trustworthy, polite in
conversation, and even cultured. The new elite, which was
already well established before World War II in the United
States, was less inhibited by all this, and after the war the
inhibiting power of the old rules of the bourgeoisie’s
conduct were also rapidly waning in Europe. The new
symbols of distinction – of class – which replaced the
traditional were based on conspicuous show of wealth,
power, and media attention. The result of this was a
decline of the values that have made western civilisation
economically powerful and given it the chance to promote
a more rational and humane world. It placed expediency
instead of truth at the head of the agenda and success
ahead of the means by which it was attained. 27
The position of the scientific and technological
research units in the large enterprises and public
institutions is somewhat different. Characteristically real
scientists are motivated by curiosity and peer appreciation.
They are therefore less keen than administrators to obtain
the kind of status which comes from power and control of
people. Often their successes and failures can be tested
by experiments and are immediately visible. Consequently,
unlike administrators whose status is determined by their
level of remuneration, scientists' and technologists'
remuneration only reflects their status which is in fact
determined by their genuine achievements. It is this, the
special position of Research and Development, which
permits innovation and scientific progress to continue in
spite of managerial inefficiency and rising unemployment.
But even here the feudal culture takes its toll. When a
section head in R&D is offered a new idea which deviates
from well-established principles he faces a dilemma. If the
idea proves to be successful, the acclaim is reaped by the
person who suggested it or by the top managers of the
organization, but if it turns out to be a failure it is he who
will be blamed. It therefore becomes safer for heads of
sections to avoid spending money on new or
unconventional ideas.
Unfortunately this debilitating culture is rapidly also
spreading to public research institutions, such as
universities. Worse than this, the penetration of
commercial interests into the world of science has led to a
confusion between profitability and social relevance.
Scientists still register tremendous achievements,
particularly where science has a high degree of
technological applicability, but they lost control over the
direction of their work. They push back the frontiers of
ignorance but leave the decision which frontiers to push
back in the hands of industrialists and bureaucrats, and
thus relinquish their moral obligation to society.
For several decades, well into the twentieth century,
science played a major role in the promotion of welfare
and economic growth. This gave scientists a special
position in society. The majority of people romanticized
their work and regarded scientists as selfless servants of
human progress and truth. At the same time the scientists
themselves developed a sub-culture of their own in the
midst of an otherwise profit-dominated social environment.
They found their ideal in the advancement of knowledge
and put this before the pursuit of material advantage. Not
that there was a lack of people in the scientific community
who were keen on money, but these did not determine
either the principles of scientific practice or the public
image of the scientist. Many students of medicine,
engineering and the natural sciences, as well as of
economics and sociology, chose their studies out of strong
social commitment. Even those studying just to obtain a
well-remunerated job with social status, or because their
parents just wanted them to go to universities, did not
escape the influence of the sub-culture's value system. In
recent years this is no longer true - the scientific
community is losing its soul; it is becoming part of the
commercial enterprise, and apart from some exceptions
forfeited its public esteem. Together with the spreading of
the feudal structure, this makes scientists less and less
able to produce new ideas and find financial backing for
their testing and application. But just as the loss of
confidence in a businessman's word is not merely a moral
decline but a real threat to the proper functioning of
capitalism, so this loss of the traditional scientific spirit - the
search for truth - is a real hazard for the proper functioning
of the new market economy, because new ideas is
precisely what western society needs to sustain a humane
face, and what industry requires to keep ahead its new
Asian industrial competitors.
In conclusions. Since the late 1970s we are drifting
toward a society which is neither economically expedient
nor offering much hope for a more humane world order.
For centuries the West, and particularly the west of the
West, had turned its eyes to the morrow and eagerly