Dear Unknown Friends:

We are serializing the great lecture Ownership, Strikes, Unions, which Eli Siegel gave on July 17, 1970. It is one of his Goodbye Profit System lectures, begun in May of that year. In them he described what no other historian saw, and what continues—intensely—in the world’s economy and the lives of people right now. He said:

What is being shown today is that without good will, the toughest, most inconsiderate of activities—economics—cannot do so well….I wish I could call it something else—good will and ill will are such pale words; but that is what it’s about…. In May 1970, the conduct of industry on the basis of ill will has been shown to be inefficient…This is the greatest victory of good will in history. [Goodbye Profit System: Update, Definition Press, pp. 2, 7, 9]

There is a way of seeing and using other human beings and reality which is ugly, and economics has been based on it these many centuries. To understand it, we need to understand the fight that goes on within each individual self, within us. Mr. Siegel explained this fight: it is, he said, between our deepest desire, to respect the world; and our desire for contempt, “the addition to self through the lessening of something else.” We go after contempt in thousands of ways. It is tempting and easy. But it is the source of all the cruelty in the world; and it is the thing in us that weakens our own minds.

Contempt is the seeing of outside reality in terms of how comfortable and important it can make us. It is the feeling that if we can lessen another, look down on something or someone, we are more. Racism, in all its hideousness, is a form of contempt. So is profit economics. The profit system is the seeing of a human being in terms of how much profit one can get from him. It is the owning of the earth—which should belong to all humanity—by only a few people. It is a boss or stockholder, who doesn’t do the work, taking the wealth that other people produced with hours and months of labor.

Giving much, much evidence, Mr. Siegel explained, with his beautiful depth, clarity, and passionate kindness: “The profit system has not appealed to man at his best or wisest,” and in these last decades of the century “the purpose of profit is no longer able to produce well and to keep Americans contented.” This is because “Ethics is a force like electricity, steam, the atom—and will have its way” (GPS:U, pp. 160, 82).

The Effort to Sidestep History

I described in previous TROs some of what has been done these decades to try to make profits keep coming in—to make the use of human beings for profit continue lucratively. And I have described some of what this effort to sidestep the force of history and ethics has done to people. For example, to keep big profits coming for a few individuals, millions of Americans are being made to work longer hours, for less, often at two or more jobs, without benefits. While government and media announce with cruel disingenuousness that the economy is “booming,” Americans are struggling, are unable to have savings, are in massive debt, are declaring bankruptcy in record numbers.

In an article in the New York Times of April 30, we find this representative, truly ridiculous, contradictory statement: There is, the Times says, “a persistent fear among workers about losing their jobs despite the strong economy.” American workers—which means the American people—are not paranoid idiots. If they have this “persistent fear,” it’s because the economy is not “strong”: there are not good, decent-paying jobs for them. The chairman of the National Association of Manufacturers, quoted in the article, affirms, “Growth is slowing and a lot of companies will be cutting back.” The economy may be “strong” for a few favored persons and big corporations. But for America, for real families across this land, the profit economy is a continuing source of daily fearfulness, fury, suffering—including, in more and more instances, hunger.

There Was the Stock Market

In this section of Ownership, Strikes, Unions, Mr. Siegel speaks about the stock market. In the spring of 1970, stocks had fallen massively. The Dow Jones, which in late 1968 had been at 985, by mid-1970 was at 630: it had lost more than a third of its value. This was the largest drop since 1929, and Mr. Siegel said it was a culminating sign, along with many other signs, that the profit system was not the thing it had once been. Here he describes some of what was being done to prop up the stock market, give it the appearance of health, despite what was really happening in the economy.

My purpose is not to talk about today’s market. But there is an increasing feeling in people that the current soaring stocks are not much connected with the real economy—the economy of going to work at a job you hate, where someone tries to force as much labor out of you as possible. How much is the stock market arranged, decorated, managed, assisted now—including by the government?: from the putting into place of circuit breakers so stocks can’t fall below a certain point; to changing which companies comprise the Dow Jones, so that only prosperous ones are counted; to the effort to have Americans’ social security be invested in and support the market?

Certainly, our government has done much to keep businesses going. It has used the IMF to ensure the profitability of US corporations, by turning the people and resources of other nations into profit-producing fodder for those corporations. Unless a “third world” nation, with its wonderful fund of “cheap labor,” serves US firms and speculators as the IMF decrees, it will not get the loans it needs and will starve. Our government has bailed out banks with taxpayers’ money while American children increasingly live in poverty. And our government is also assisting the making of profit by bombing the people of Iraq and Yugoslavia. Military expenditure stimulates the economy: the explosives dropped on Belgrade, like the planes that drop them, are part of US economic production and keep American companies and workers busy. In 1970, Mr. Siegel explained:

What has tended to blunt the Depression of 1929 has been a condition of war. That made people feel the Depression was over. The Depression of 1929 is not over. Capitalism has been sustained by war conditions. [GPS:U, p. 97]

It is being sustained by them now.

Owning

Meanwhile, there is ownership itself. This Aesthetic Realism principle is true about ownership, as about everything else in the world: “All beauty is a making one of opposites, and the making one of opposites is what we are going after in ourselves.” Ownership, Mr. Siegel shows in this lecture, is always a relation of opposites: oneself and something standing for the outside world. Ownership can be beautiful if it is in behalf of justice to the thing owned and to all things and people. Owning a book can have us fairer to all humanity and earth, if we are trying to know what is in the book. But to own in a way that stops other people from being all they could be, is infinitely ugly. And that is how the world has been owned for hundreds of years. So I quote sentences that I love, from Eli Siegel’s Self and World: “We can own the world only by knowing it. We can possess the world only by having it in our minds; that is, by having knowledge of it” (p. 279).

Those sentences stand for how he was all the time. His brave, beautiful purpose was always to know, and to bring out the strength of every person, and the world itself.

—Ellen Reiss, Aesthetic Realism
Chairman of Education

Stocks and Ethics

By Eli Siegel

Note. The “this” which Mr. Siegel refers to in the first sentence is the insistence by reality that economics become ethical.

I shall, in coming weeks, present evidence that this goes on and is invincible. There’s no chance of its being otherwise. In order to place what has been happening—there was an article in the New York Times yesterday about something which is important and which is coyly, and I think deceptively, underplayed. You can get this story and watch how it is arranged, what is made important, what is seen as not so important. “Six More Failures Reported for Big Board Members,” by Eileen Shanahan, begins:

There are six member firms of the New York Stock Exchange that are currently in liquidation, in addition to the four whose failure had previously been announced, it was officially disclosed today.

So there may be even more. This did not occur in 1930. The houses were hit, but it was mostly the investors who suffered.

The New York Stock Exchange…let it be known that it intended to reimburse all customers of the failed firms….The reimbursements…would be made without imposition of the $50,000-per-customer limit that has been recommended for inclusion in pending legislation creating a Government-backed insurance corporation to deal with brokerage firm failures.

What we find is a kind of socialism going on in the stock exchange, where the stock exchange and the government are in a tie-up to make sure that what happened will be put aside as much as possible, and won’t happen again. What occurs always is, when capitalism is in danger, it uses an aspect of socialism to remedy itself and then says that it always has the power of reviving itself.

There will be “a Government-backed insurance corporation to deal with brokerage firm failures.” This shows the nerve of what is called free enterprise. It wants the government to help the situation. That is socialism from the top. On the one hand they want a free market, and here there’s a calling for something else than a free market. That has happened before. It has to do a great deal with the rise in the stock market and the entrance of institutions. Because if the institutions think the government is that interested that it will sustain the brokerage houses, they feel they cannot lose as much. What has happened is, the government has stepped into the stock exchange, and socialism is helping the profit system now. It’s not the innate capacity of the profit system to revive itself on its own; it’s the capacity of the profit system plus something not the profit system.

Ownership and the Profit System

Here we have an idea which has to be dealt with a little—you cannot make it too clear—the idea of ownership that is in the profit system. The profit system can be defined as the [private] ownership of the means by which production goes on, and the setting down of terms for the rewards of that ownership and production by the owner. Where that is interfered with, capitalism is that much dented. Ownership itself can be defined as a relation of something to oneself so that one has the use of it only for oneself, with the power of denying the use of the thing owned to another, or the power of getting a reward or a charge if the use is given. It’s a relation to something—as a person, let us say, has a machine and can charge so much an hour for its use by another. And meantime, you have the right to use it yourself and you also have the right to deny it.

Ownership is the having of a thing utterly and the using it by oneself and for oneself utterly. As soon as the utterness is infringed upon, the ownership is that much diluted. This goes for oneself. If people, as they do these days, sell their hair, it means they have the ownership of their hair—they can sell it. There is the O. Henry story about how Delia sold her hair.

“A House Commerce subcommittee…concluded hearings today on the proposed Securities Investor Protection Corporation.” That is a long title, but it does mean the entrance of the government more in the investment business. It should be on the front page and made clear to every reader. Is there some socialism now helping the profit system? Because as soon as the government steps in in any financial situation, it can be called the participation of the state or collective power.

Mr. Haack [the exchange’s president] said…the exchange did not plan to make public the names of the six additional failures “as to do so would seriously jeopardize the prospects for an orderly liquidation and thereby may adversely affect the customers of these firms.”

The stock exchange is like the manager of a movie theatre. I remember a person once rose in a cinema and screamed; people were excited, there was a little scuffle, and the manager came out and waved his hand. Meantime, the show went on, the lady likely was escorted out, and you had it all “liquidated.” This desire to say nothing has happened, really—everything is as before—well, the question is, is it? People would like to think so.

No member of the subcommittee pressed Mr. Budge or anyone else for information on the size of the failed firms, the reasons for their failure or any other matter.

Ms. Shanahan saw something. This committee, the government, the administration, and both parties are all interested, in these times when Washington values are in jeopardy, in making everything look good.

So there are firms who over the months felt profits would go on, and they were wrong in such a way that they jeopardized themselves and also their customers. How did that happen? Did it come from something large, and permanent?

Something Failed

Well, this is what I am saying: the stock market was shown as vincible, and the profit system was shown as vincible—not just through the stock market; the stock market was the last sign, in fact. The postal strike came before, and many other things which I’ll mention and have mentioned.

The entire question of the amount of risk the Government might be taking in pledging $1-billion, if necessary, to pay off investors in the case of future failures, dominated the final day of the subcommittee hearings.

All this has to do with why stocks have been going up: because the government has discreetly but definitely shown its interest. It is not the profit system by itself, but the profit system with a few adjuncts.