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Sep 15, 2010 12:13 am

Thorstein Veblen and the Liberty Fund

It is unlikely Thorstein Veblen would have been invited to the recent Liberty Fund conference on Isabel Patterson.

In"Conspicuous Consumption," Veblen states that"the exigencies of the modern industrial system frequently place individuals and households in juxtaposition between whom there is little contact in any other sense that that of juxtaposition." In the absence, in other words, of any other connecting mechanism, we are driven to consume, and thereby display, our wealth as the only means of establishing our social identities and relationships to each other."The only practicable means," he says,"of impressing one's pecuniary ability on these unsympathetic obsevers of one's everyday life is an unremitting demonstration of ability to pay."

Two things should impress us here, and both are at odds with the evangelstic free-market individualism of The God in the Machine (Patterson's 1943 work). First, Veblen correctly identified consumption as a mechanism of social solidarity -- not a particularly good one, however, since its use depends on buy and selling items chiefly intended for display, not practical employment. Veblen believed this led to a misallocation of resources, as well as a noteable deadening of the social bonds that unite people in less consumerist societies. People become flat and one-dimensional, and their interactions with each other, however one measures them, increasingly fragile and subject to disruption with the viscissitudes of the market. With only conspicuous consumption to unite them, and only the market to make that happen, everything depends on keeping the market intact. When it fails, so the logic goes, so does the very basis of social solidarity.

The second point at odds between Patterson and Veblen would surely be the question of human nature. Patterson seems to have believed that it is natural to want to be free, and freedom involves relentless individualism -- the only force, she thought, powerful enough to keep at bay the dreaded threat of" collectivism." The free-market thereby is not a thing in itself, but a defense against something else(collectivism) that Patterson has a hard time explaining except as a freak of nature. Why, then, are we constantly menaced historically by something Patterson considers an aberration? Veblen thought differently: freedom, once exercised, could become the basis for voluntary cooperation, the actual foundation of our nature as social beings. If such a point be conceded, even for the sake of argument, that it alters and diminishes the role of the market. At the very least, it de-links the market from the role Patterson attributes to it: the direct expression of human nature, and its primary guarian.

No, one doesn't suppose Patterson and Veblen would have gotten along, or that Thorsten would have been invited to the conference. But I cannot help but think the juxtaposition would have been all the more interesting for that reason.

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