089: James Brusseau on Wealth Inequality and the Accursed Share

Frank Conway:

Welcome to the Economic Rockstar Podcast with your host, Frank Conway. Connecting brilliant minds in economics and finance.

In this week's episode of the Economic Rockstar Podcast, I speak with Dr. James Brusseau, author and philosopher at Pace University, New York City. We talk about wealth distribution, equality and inequality, freedom, as well as the work by Georges Bataille on The Accursed Share.

You can check out all the links and resources and books mentioned in this episode at economicrockstar.com forward slash James Brusseau. That's B-R-U-S-S-E-A-U. And you can find a back catalogue to all the podcast episodes at economicrockstar.com forward slash podcasts.

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James Brusseau:

Cigarettes or brainstorming or wars, all of these belong to what Bataille calls a general economy, and all of them produce an accursed share, a reality where we have too much, not too little of something and it leads to problems in the world.

Frank Conway:

Hi, Frank Conway here and you're listening to the Economic Rockstar podcast. I am so honored to have Dr. James Brusseau join me today. Hi, James, welcome to the show.

James Brusseau:

Hi, Frank, thanks for having me. Glad to be here.

Frank Conway:

Dr. James Brusseau is a philosopher specializing in contemporary continental philosophy, history of philosophy and ethics. In 1994, James joined the Faculty of Philosophy and Letters at the Mexican National University in Mexico City, teaching graduate courses in philosophy and comparative literature. He's also taught in Europe and at California State University. Dr. James Brusseau is currently teaching at Pace University in New York City.

He is the author of four books, Isolated Experiences, Decadence of the French Nietzsche, Empire of Humiliation, and Business Ethics Workshop.

He's also the host for the Wealth Inequality Workshop at wealthinequalityworkshop.org and you can find the work by James at jamesbrusseau.net.

Hi, James, I'm very interested in the work that you do, especially coming from a philosophical angle in terms of your understanding and interpretation of economics and also your influences that you have. Let me start with the Wealth Inequality Workshop, if you don't mind. You come from it in terms of philosophy and ethics regarding wealth and its distribution.

How different would that be from an economics perspective, even though when we look back on the works of Adam Smith, he was front and foremost a philosopher who spoke about wealth as well?

James Brusseau:

Certainly. Definitely. I think, though, that even though there is quite a bit of overlap between the way economists, especially those who are trained in sort of the history of economics, talk and philosophers talk, I think that there are some pretty clear lines that can be drawn.

One of those lines would be something like an assumption. I think that economists assume that economic growth or wealth in and of itself is positive, that that's sort of the end, in a certain sense, of a well-regulated economic system. I don't think—I hope at least—that philosophers don't have anything against that. But we don't tend to start from that kind of perspective.

We tend to start from ethical values when we discuss wealth distribution. And traditionally, the two values from which we start are those of equality on one side and freedom on the other. And then when we discuss this issue, the kinds of assumptions that we begin with are: we will either take one side or the other.

That is, there's a bit of a misconception sometimes when I hear people discuss this issue in terms of equality and freedom that they imagine that these two values or these two ways of seeing the world, that is, the idea that we should privilege equality in the economic world or, by contrast, we should privilege freedom. Sometimes when people talk about that, they talk about them as though those two values are in conflict. That's not quite right for us. Instead, we start from the idea that either we will privilege equality and then see how that value actually works in the world. Or on the other side, we will privilege freedom. So our debates in philosophy and ethics are sort of multi-level debates, right? We have people exploring along the freedom line and along the equality line. And people have completely different assumptions when they come from one side or the other.

And that's part of the reason—now, to sort of wrap this up—I believe in normal conversations sometimes it seems like debates about wealth inequality or wealth distribution don't go anywhere. They can't go anywhere because the people are departing from different intellectual or ethical premises, right? One side will begin from the idea that what we're looking for is some kind of equality and the other side will begin from the idea that what we're looking for is some kind of freedom and then these two sides, they can't engage.

So part of what we're trying to do with this project is we're trying to set out clearly what these two ways of thinking about wealth distribution are, not so much that we can decide between them or aim people one way or the other, but instead so we can clarify what kinds of premises and what kinds of commitments are being made when people approach the idea of wealth inequality from one side or the other.

And then as I say, all that would kind of separate, I believe, from an economic approach in the sense that an economist would assume from the beginning that what we're looking for is some kind of growth and maximum wealth overall.

Frank Conway:

And when you talk about equality or freedom, are you talking about it in more of a moral or would it be more in financial terms?

James Brusseau:

Well, I think—excellent question, right?—I think you can come at it in both senses, but in this particular workshop, because we're trying to make things very practical, we are talking in financial terms, right?

But even so, it's not so easy there. We could think about equality in terms of wealth, but we could also think about equality in terms of opportunity, right? So just from the start, the questions become very hairy and complex.

But stepping back from that, what I can say is that in general, we're beginning from the idea that when we think about equality and we're asking about society in terms of wealth distribution and equality, we're asking, first of all, whether or not it's possible to imagine a society where everyone has equal wealth.

And then if it's not, and I believe it is not, then what other kinds of theories can we use to distribute wealth which preserve this idea of equality even while recognizing that inequality is going to function? And that would be in the simplest terms, in terms of the amount of money that people have in their bank accounts.

Frank Conway:

And just thinking on what level of equality or inequality is acceptable—this thinking isn't new. It's not new thinking at all. And is there a possibility that a society could have been created intentionally to have a certain level of inequality? Because you also talk about freedom as well, and if you're talking about financial equality, obviously, or perhaps you might refer to financial freedom too. And to have financial freedom, I believe you might have to have a different wealth distribution.

James Brusseau:

I'm not certain that that's true, curiously. But going back to the equality side, I think that it is true that even if you try to set up a perfectly equal society, that society would not be sustainable.

Here's kind of a thought experiment which is frequently run through when this discussion begins on the side of equality. Let's just imagine that we've decided we're going to build a society and our highest value, that is, we are going to orient everything that happens in the society at least economically, around the idea of equality.

So what's the society going to look like? Probably we're going to start out with having everybody living in the same size apartment and getting every week, say the same bundle of necessities and luxuries and so on. And so everyone will live identically, right? I think in that, from that scenario, we can say, look, we have an equal society, but then the question we have to ask is, is this sustainable? Uh, and probably it isn't for the following reason.

Um, let's just imagine that we, you and I live next to each other in one of these buildings, uh, and you really like chocolate and I really like wine, and every week we get in our bag, we get a resource bag, we get a bit of chocolate and a bit of wine. Well, of course, it's not going to be long before we figure out, let's trade. I'll give you my chocolate. You give me your wine.

This is called a Pareto efficiency in economic terms because what's happening now is very curious in philosophical terms. What's happening now is that you and I are better off than we were before, right? I have more of my wine that I like so much, and you have more of your chocolate. But nobody has gone backwards, right? No one has lost. It's just that you and I are better off.

In this situation, however, even though no one has gone backwards, it remains true that you and I are better off than everybody else. We must be because we started out equally, and now you and I, because of our exchange, we're in a better position, right?

So if that reality happens on the one side, and on the other, we insist upon maintaining this equality that we started out with, then one of the following two things must be done. We must either forbid free exchange, that is, we can't let you and I change wine for chocolate, or on the other hand, we must forbid different desires or wants, right? We can't allow that you want chocolate more than wine and I want wine more than chocolate.

That one of those two things has to be prohibited. Otherwise, equality is going to collapse.

But even if we do that now—and this wraps up the argument—if we're going to prohibit either different desires or free exchange, then we're going to need someone to enforce that. And those enforcers, by definition, because they're getting their way and you and I aren't, those enforcers are above us. So no matter how we try to arrange this equal society, it seems like it's going to come apart as long as it's true that individuals are fundamentally different, and I believe we are.

So when people talk about equality in terms of philosophy and ethics, they usually start right around that point. And they say, we're going to value equality and we want equality, but we can see that it can't work correctly. So we've got to find some other theory or some other way of holding the society together in a way that maximizes equality in terms of either bank accounts or resources, wealth and so on.

Frank Conway:

What you were explaining there—I had a thought that perhaps this would have been played out, not even in terms of an experiment, but perhaps in, say, prisons or the school where kids might have their lunches. They may have different lunches, but you might see this social equality or inequality play out, or Pareto efficiency being played out, when kids end up swapping. The authority could be like the government—the teachers or whoever is supervising the kids at the time—that might prevent the exchange happening.

Have you come across any examples whereby a situation was created in which all participants would have perhaps been seen as equal, and then see how this played out in a type of economy or an economic system?

James Brusseau:

Well, you see, this is one of the great things about being a philosopher. I'm so happy I chose this career line because I am not burdened by those kinds of requirements. For people who work in economics or your recent guest who was doing social psychology, they're burdened by some kind of need for empirical proof. You've got to go out in the world and see how these things work.

But, you know, the truth is I have not imagined this work—rather, I have imagined it, but I have not imagined actually applying it or trying to see how it will work experimentally in the world because that's just not the way philosophers operate, right? It's an advantage and a disadvantage of our pursuit. But it does—it is quite convenient because it allows us to move rapidly from one step to another of our thinking. But to answer your question, no, I haven't actually seen in the world this kind of thing working.

I remember very briefly, this is just sort of from when I was a graduate student. I was working on a French philosopher, Gilles Deleuze, and he had kind of an interesting or curious reading of schizophrenia. And he used the definition quite liberally to make several different philosophical claims. And so I was sort of hot on this subject and very excited writing a paper and all.

And I went over to the psychology department and I asked one of the professors there who was an expert in this and I started spilling out my Deleuzian ideas about schizophrenia and so on and he listened to me for about five minutes, and then sort of paused and looked me in the eye and he said, “Have you ever actually seen a schizophrenic?” I had to admit, no, I hadn't.

So in any case, that's kind of the way philosophers are. We do tend to jump over that concrete stuff. It's a luxury and a burden too, I suppose.

Frank Conway:

So one of your books, The Decadence of the French Nietzsche, is this what you mean by decadent philosophy whereby you do theoretical?

James Brusseau:

No, no, I don't think so.

I think that's the way philosophy is. I think that if you trace all political philosophy, at least all of it that is coming to mind with the possible exception of someone like Adam Smith or someone, I think that generally we are quite theoretical and abstract.

I think that the book Decadence of the French Nietzsche has quite a different meaning and has to do with the way that philosophical concepts are created by corrupting or perverting ideas that are inside of a certain thinker. But that would lead us far off the path of where we're going, actually.

Frank Conway:

Yeah, I'd like to take us back to the Wealth Inequality Workshop, if you don't mind.

James Brusseau:

Yes, please.

Frank Conway:

Yeah. When you talk about the philosophy and ethics of wealth and its distribution, you mentioned at the opening of the video—which I'll link up, the documentary; I'll link it up on the show notes page—you talk about the theoretical equality and the sacrifices and compromises of wealth equality in the real world.

So you mentioned a theoretical situation where you might have a couple of scenarios. You created one of them for us, where everybody would have equal resources or a resource pack. They live in the same type of environment, and then you might have a Pareto-efficient outcome.

But what sacrifices or compromises do we have to make in order to lead us toward wealth equality, or is that even an optimal outcome for society?

James Brusseau:

Right. So let me take the second question first, the optimal outcome. I think that for somebody who promotes the notion of equality as the highest value, by definition, the best or most robust equality you can find is the optimum outcome.

Whereas, by contrast, if you start from freedom, then you would say you want to maximize freedom. So that's the answer to the first question, the notion about what the optimum outcome would be. If you start from the value of equality, that's where you want to go.

Then with respect to the sacrifices that have to be made, one of the things that we do in that documentary is we start out with this scenario in which we have the resource pack, which is equal. It doesn't work. So what other kinds of versions of theories of equality can we put forth? And there are two principal theories that have been advocated traditionally within philosophical circles. One of those belongs to an American philosopher named John Rawls. The other traces back to the English school of utilitarianism.

I will start with John Rawls. His idea is, he says, look, we can't make straight equality work in the world. But, he says, I want equality to be maximized. So what can I do? He says the following. He says, the way we should distribute resources in society is so that any advance or any increase in wealth always ends up giving maximum advantage to the least advantaged.

In other words, to put this in more conventional language, what John Rawls says is he doesn't mind a little bit of wealth inequality as long as the poorest of the poor are not left behind.

So a scenario like this would be: sometimes people talk about a kind of a war scenario where a group of soldiers has an injured comrade and they need to retreat. The question is, well, do they run away leaving their injured comrade behind or do they jeopardize themselves by trying to carry their injured comrade out? What John Rawls says is, look, we can't have the kind of inequality where we leave the injured or the poverty stricken, let's say, behind. We have to wait for the poorest of the poor in society.

So kind of wrapping this up, the version of equality that Rawls proposes is: he says, look, we have to have some inequality in society. That's fine. But we need to also make sure that every time we have a kind of economic advance, those who benefit significantly or perhaps most are the poorest of the poor. And if that requirement is not fulfilled, then no one gets to advance. That's Rawls' fundamental position.

So we can't have Bill Gates getting extraordinarily wealthy unless he can show us that his—let's say Microsoft Windows or what have you—that the innovations he has created to become wealthy help not only you and I in the middle class, but they also help the poorest of the poor. And it's not clear to me that in our contemporary society, that the poorest of the poor are in fact aided by something like Microsoft Windows.

So let me stop there for a moment and say that's the theory. What I could add to that, then, is the problem with this theory for people who don't like it. What they don't like is this possibility that we end up in a kind of dictatorship of the poverty stricken.

That is, if people like Bill Gates are not allowed to innovate, not allowed to create products and then wealth for themselves unless there's a benefit for the poorest of the poor, then curiously, those who wield the most power in this society and those who are able to actually hold everyone else up are the least fortunate or the poverty-stricken.

So there's a kind of a threat here, but again, a dictatorship of the poverty-stricken, which is a sort of curious outcome for kind of a theory that wants to start with the idea that we're going to valorize and try to reach equality.

Frank Conway:

Are there any kind of economies that practice this type of thinking?

James Brusseau:

Well, I think, you know, to a certain extent, just as you were running through some of those schools at which I've taught, I've had the fortune, I believe, to live in some places where wealth is distributed in very different ways.

Mexico, where I lived for about a decade or so, in a certain sense, that's a pure free economy, which I can talk about maybe in the future a bit. But I think that to a significant extent, I think that the European economy—though I'm thinking of Spain and the Mediterranean countries, France, Spain—to a significant extent, I think that those are difference principle or Rawls kinds of economies.

What I mean by that is that the welfare state in Europe, in my personal experience, obviously you know more about it than I do. But in my personal experience, the welfare state in those Mediterranean countries, in the attempt to guarantee a sort of basic livelihood for more or less every citizen, there are so many rules and regulations that are imposed upon people.

Especially I'm thinking, I remember when I was working in France, I marveled at the fact that no matter what an employee did, he or she could not be fired, right? Right. So the state imposes these rules to try to guarantee a kind of minimal condition for individuals in the society. And they also have very generous unemployment and health care and so on.

But one problem with that is that the society becomes so inflexible that it becomes very difficult for people to innovate. Here in New York City, where I live now, New York City is just full of European expatriates who come here because they want to be able to create companies or create some kind of professional destiny free of these kinds of regulations.

So I think that to a certain extent, you could say that the Mediterranean states at least, Ireland might be a bit different, but the Mediterranean states, European states, are a little bit like examples of what we're talking about here. States where there's almost a dictatorship of the least advantaged, where the endeavor is so great to preserve the welfare of the poorest that the wealthiest end up being caged by this generosity. So I guess I would use that as an example, the Mediterranean states of Europe.

Frank Conway:

So this generosity that's created in order to help the poorest of the poor, is this where the governments might have to step in and, say, tax the wealthier companies or individuals in order to redistribute wealth? Because what happens with taxes is, as we know, there are tax loopholes and offshore accounts. Then we end up kind of distributing the tax burden on other people who, say, are the middle class or the lower class.

James Brusseau:

Well, I think that's right. I think that on a practical level, it seems like there are some holes in the ideal. But I would still want to maintain my original point that I think that the intellectual model that governs—I'm thinking again especially of Spain and France—the intellectual model that governs regulation is one in which the decision has been made.

And in order to do the best we can to guarantee equality, we are going to hold the most innovative members of our society hostage to the needs of those who are the poorest or the least advantaged in terms of education and so on. And the way that imposition works is through regulations and taxes.

As you say, it might not be perfect, but I think it does function. My sense is it does function that way. I happen to be married to a European, a Spaniard. And that's certainly the story that I hear from the Spaniards who are flowing across the Atlantic to work here.

Frank Conway:

And would people tend to value equality more than freedom? Or what would Rawls' opinion or even your own opinion be on that one?

James Brusseau:

Right. First, I would say that Rawls certainly values equality. That's why he does what he does. And then I would say more generally that in this project, the Wealth Inequality Workshop project, what we're trying to do is show charitably and generously—march through—the way you could come at the issue from one side or from the other.

As for me personally, I think it's fair that I sort of give away my bias to the extent there is one. I would be—I'm sort of a—I suppose they call me an anarchist capitalist. So I tend to value freedom more than equality. But again, the workshop as we present it is certainly not tilted. At least we hope it's not tilted one way or the other. Instead, we're trying to run through and show in the most generous and powerful terms that we can muster what it looks like to think about the world economically and inequality in terms of the value of equality and by contrast, in terms of the value of freedom.

Frank Conway:

Recently on an episode with Denise Cummins, we spoke about fairness in economics. And I'd love to be able to talk to you briefly about philosophical thinking on fairness and how it might be applied to an economic system.

James Brusseau:

Right. Listen to that. We have two sort of general ways of thinking about fairness. I think that I will say just quickly as a footnote that for those who want to come at the question of wealth and its distribution in terms of individual and human freedom and liberty, for that group, the question of fairness itself is not terrifically pressing. Instead, it's much more quantitative.

There's the idea that we want to maximize freedom. But going back to the equality side, it's on that side where fairness tends to draw more attention. And there are two mainstream ways of thinking about fairness. One belongs to Aristotle and the other belongs to Rawls, who we just talked about.

But Aristotle's definition is sort of deceptively simple. It is: fairness is defined for Aristotle as treating equals equally and unequals unequally. So then you ask, okay, so what does that mean?

I mean, in economic terms, there's the whole gamut. You can run from one side to the other. You could say, look, if you and I are adult human beings, that is, we're equals, then you and I should be treated equally. That means you and I should have the same wealth.

By contrast, you could say just as easily, well, wait a minute now. If you work 80 hours a week and I work 40 hours a week, then we're unequals and we should be treated unequally. In other words, your wealth should be twice as great as mine.

Or again, you could say, well, imagine that you have some tremendous talent which is 10 times greater than my talent. Well, then in that case, we are again unequals and should be treated unequally and you should have 10 times the talent I have.

So it's kind of hard to know exactly what “treat equals equally and unequals unequally” is going to mean in any specific case. But that's one way that we think about fairness.

The other way that we think about fairness is in terms of something called the veil of ignorance. And this definition is slightly different. The definition of fairness here is that any decision you make is fair if you don't know how that decision will affect you in the end. That's why it's called a veil of ignorance. That is, you need to make the decision without knowing how you will be affected.

So a simple example of this would be, I'm not sure in Ireland how things work, but I remember when I was young, sometimes I would go after school and get a slice of pizza with friends. And maybe I only had enough money for half a slice. And so I would find a friend and the two of us would together buy one slice. And what we would do is one person would cut the slice in half and the other person would choose the side.

Well, that's Rawls' fairness. That's fairness in the sense that that's the veil of ignorance. I make a cut and I don't know which side I'm going to get. Therefore, and this is the curious part, no matter how I make the cut, it doesn't matter if I cut it evenly or unevenly or what have you, no matter how I make the cut, it's a fair cut. Why? Because again, I don't know how that cut will affect me.

And then moving this over just very quickly in one minute, you can apply this to the question of wealth distribution very easily. You can say, look, you could imagine what Rawls would say is: you can imagine society and the distribution of wealth within it any way you like. He doesn't care, as long as you're willing to accept the following deal. Once you've got that society envisioned, you get shaken up and thrown back into that society at some place that you do not anticipate or some place you don't know beforehand.

So let's say that just hypothetically, let's imagine that I say, well, the U.S. society today has the perfect distribution of wealth.

That's fine as long as I'm willing to take the odds that go with my being shaken up and then getting thrown back into this society perhaps not as a philosophy professor but instead as a mailman in Nebraska or what have you. I don't know beforehand where I'm going to be. But if I'm willing to take those odds, then whatever decision I make is fair.

So that's two very different ways of thinking about fairness. And they're both quite different than the way you talked about with the—I believe she was a social psychologist—last.

Frank Conway:

When we were communicating by email recently, you mentioned—I hope I get the name pronounced correctly or you might check it out for me. Is it Georges Bataille?

James Brusseau:

Bataille is correct.

Frank Conway:

Georges Bataille's theory of the accursed share—it's something I've never come across before until you mentioned it to me. I kind of explored it a little in preparation for this interview or discussion with you. He wrote a book called The Accursed Share: An Essay on General Economy. It's something that you said you'd like to maybe touch on, and I'd like that, actually, if it fits with the type of thinking we're discussing now. Could you explain to us what the accursed share is?

James Brusseau:

Right, the accursed share is something like the following. Traditionally, philosophers have believed that desire is something you have because you have too little of something. So you think, for example, well, why do I want food? It's because my stomach is empty, right? I need to fill up my stomach and once my stomach is filled, I will no longer have hunger, right?

So we have this general idea, and this is a vision you can have of humanity itself, right? You have a general idea that humanity is less than perfect, less than we could be, inferior to our optimal or excellent state, right? And then our task here in the world is to fill ourselves up, to fill in our imperfections, to make ourselves complete and then we will be happy. Just like when I'm hungry for food, I eat the food and I'm satisfied.

What Bataille says is, you know what? There's a different way of thinking about imperfection. It's not that we are imperfect because we have too little. Instead, it's that we're imperfect because we have too much.

And then you can find this; this traces back to Dante in his Inferno. You know, you might remember Cerberus, the dog that guards the gates to hell. One thing that's curious about this dog is that the more it eats, the hungrier it gets. That's why it's such a good watchdog.

So Bataille is kind of going along those lines and he's saying, look, I mean, is it possible that we're in a situation existentially and economically where we are imperfect? We're unhappy or unsatisfied, not because we have too little, but because we have too much. And then he would go on and say, our attempts to make ourselves perfect, therefore, because we have too much, only make things worse. The more we eat, the hungrier we get.

And then a simple example that I use, kind of a common everyday example of something like this would be something like a good brainstorming session. When you get together with some colleagues to hash out an idea, if it's a good brainstorming session, one person will have one good idea and that will lead to two more good ideas from someone else and then two more, four more and eight more.

And it's kind of curious that a really good brainstorming session, instead of yielding an idea that leads to something you can do, it makes the situation worse because now you have so many good ideas that you're even more paralyzed than you were before. So there's this idea that we could be imperfect because we have too much.

Now, what does this have to do with the economy? What Bataille says, curiously, is that our traditional marketplace economy, far from being insufficient, far from not providing our needs, our traditional marketplace economy is more than satisfying our needs. We are too perfect. We are beyond satisfaction. We are imperfect; in our attempts to make ourselves satisfied, we just make the situation worse.

And he says we can explain specific sociological phenomena in these terms.

For example, for Bataille, he says the reason that we have wars is not because there's competition between empires for land or not because some dictator has risen to power and wants to expand his or her influence. No, what Bataille says is the reason we have wars is because we need to expend this extra wealth we have, this wealth which is too much, which is more than perfect. And that part, that extra part, that's what he calls the accursed share. It's when you have too much of something which is good.

And then bringing this—I can quickly kind of bring this back into the question of wealth inequality and the idea of freedom. The way that applies to the idea of freedom is—and this is exactly what happens in Mexico. In Mexico, this is a very liberal and free society economically. But the problem they have there is not that people have too little freedom. Instead, they have too much freedom. In fact, the freedom is so much that it ends up weighing down and destroying the economy in ways I could talk about.

But that's what the accursed share is: the idea that we need to reverse the way we think about our relation with perfection. It's not that we're less than perfect. It's that we're more than perfect. It's not that we have too little. Instead, we have too much. And that leads to a kind of destruction of oneself.

Another very quick example, and then I will turn it back, would be something like cigarettes. Think about if you smoke one cigarette today, then you'll have the desire to smoke two tomorrow and for the next day and so on. Anyone who smokes cigarettes knows what this is like. And what happens? Well, eventually you smoke so many cigarettes that you rot out your lungs. So it's the desire to smoke cigarettes, which destroys your ability to smoke cigarettes because you've had too many cigarettes. You're beyond perfect.

So those are different examples. There's cigarettes or brainstorming or wars. All of these belong to what Bataille calls a general economy, and all of them produce an accursed share, a reality where we have too much, not too little of something, and it leads to problems in the world.

Frank Conway:

And this is something we generally wouldn't come across in economic textbooks because it seems to defy the thinking and the principles of economics based on the ideas of scarcity, utility, maximizations, satisfaction, and so on. So he calls it the general economics as opposed to restricted economics. Right.

And what you're saying there, what he has written about, it does make sense, especially when we're talking about consumption of data on social media. There's a huge spike and people just want to consume and consume all this nonsense, ridiculous information.

James Brusseau:

And then what Bataille would say is this—we are imperfect in the sense that we have more information about either companies or what our friends are doing or what have you than we need to be perfect. And in our endeavor to get back to some perfect state, we just add more and more information which makes the situation even worse. And that will lead according to Bataille inevitably to some kind of accursed share, some kind of breakdown in the system for some reason. I don't know what the reason would be, but that would be the way Bataille would analyze this.

Frank Conway:

Would there be similarities with, say, food mountains, oversupply of agricultural produce and that ends up being wasted?

James Brusseau:

I think there would be, yes. That does make sense to me, though I would have to think about it. These things you kind of want to let them settle in your mind a little bit generally. But as you say that, it seems consonant with what I understand of Bataille.

And then, as I say, kind of bringing this back to the notion of wealth inequality, what Bataille sees in the idea of human freedom in the marketplace is that let's imagine that we start out with the idea that we want to establish a world where we don't care about wealth equality or inequality. All we care about is maximizing individual freedom. That is, the ability for you and I to go out in the economic world and other worlds, but in the economic world, and create ourselves as we want to be.

We may want to create ourselves as marvelously wealthy barons of industry or we may want to create ourselves in some different way.

But for people who want to begin from the idea that freedom is the highest goal of the marketplace, the fear that we have is that freedom could fall into a kind of Bataillian trap. That is, we could have so much freedom that freedom ends up rupturing or destroying itself.

I can give you an example from Mexico. I remember this quite well. I was involved with a group of people. We pooled some money and would buy buildings. And there were architects and engineers and a bunch, uh, and we remodeled the buildings.

And I remember when the inspectors would come by, uh, as they would do every week or so. Uh, and they would always of course find something. Uh, we would ask them very simply to give us the sheet of paper where they had written down the violation. One of us would pull out a 500-peso note—that's about 50 bucks—fold it into the paper, and hand it back to the guy. And that was it. He was gone.

One of the results of this in Mexico is terrific and one of the great beauties of the country is that architecture is completely unrestricted. And I think this is part of the reason why there are so many good Mexican architects, Barragán, Legorreta, and others who are flowing into the United States now. You can do whatever you want. There are no restrictions. I remember some marvelous and wacky homes that were built in the middle of residential neighborhoods that you could never get close to doing in any neighborhood in the United States. Why? Because you just pay off the inspector.

Mexico is a place where freedom maximizes. However, it's also a place where, to a certain extent, freedom gets out of control. And those people who are capable and who are innovative or industrious and pursue some end or another, they have become—and I think this is simply true in Mexico—so wealthy that the entire society—not the entire society, but significant segments of the society—has stagnated. And there is little opportunity now for many people who live in the country to become wealthy.

So it's kind of a case, the reason why so many people are trapped in poverty in Mexico is not because there's insufficient freedom for individuals to pursue their own goals in the economic world. It's the contrary. It's because there's too much freedom. And that's kind of an accursed share kind of reality that has the result of ruining economic mobility and ultimately freedom for individuals.

So it's a curious situation you have in Mexico where there's maximum freedom, and we want that, but it goes so far and spins so hard and out of control that it ends up destroying itself to a significant extent within the society.

Frank Conway:

And we've seen a lot of reports of late, especially with one of the presidential candidates—it's Donald Trump—and his views on building the wall. Is this one of the reasons why we might have a lot of immigration from Mexico into the United States because of the large amounts of freedom and the accursed share which has brought about this emigration from there? I think that, you know.

James Brusseau:

It's curious. It hadn't occurred to me. I think that's precisely right. But, curiously, oddly, one of the reasons—of course, it's just one of the reasons—there is so much migration from Mexico to the United States is not because there's more freedom here than there.

On the contrary, there is still more freedom in Mexico than here for those who can manage to get a little bit of money together. But there's too much. There's an accursed share of freedom in Mexico. And it ends up having the result of crushing opportunities for many of those who end up crossing the border. But again, the curiosity is that they're forced to flee not because there's too little individual freedom but there's too much.

And then I think something similar, you could perhaps move this analysis over to think about the mortgage meltdown in—I'm thinking it was at 2006 or 2008 in the United States or 19. Now my years are running away from me.

I mean, whenever at the end of the second Bush administration there was the mortgage meltdown and Goldman Sachs was involved and there was this Abacus scheme where they were selling monetized mortgages that they knew or they believed were going to collapse. They were selling them in the market so they could short them in the market.

Something like that would be an example, I think, of how kind of a pure economic freedom ends up throttling itself where the system itself gets to the point where it undercuts its own reality, right?

When you have a place like Goldman Sachs, and this is the case with Abacus, right, when they were cutting up mortgages and selling them knowing that they were going to fail so they could short them themselves in the market, that's a situation where the entire idea of the investment bank comes in and collapses itself from within.

Of course, they were bailed out, but that's a different question. If they had not been bailed out, there would have been a collapse and the collapse would have resulted not from too little freedom but too much.

So when we talk about—just to wrap this up quickly, when we talked about the equality side of wealth distribution, we talked about the different ways that equality could be instrumented in the world and what some of the drawbacks are to one or another way.

And by contrast now when we've moved over—you've led us well to discuss now the idea of freedom and we're starting to see that the problems on this side and on the freedom side and wealth distribution, those have to do with the question about whether or not freedom—which we want if we start from this premise, right?—can undercut and ruin itself by creating wealth distribution, which is so imbalanced that opportunities are lost as perhaps exists in Mexico.

Frank Conway:

It sounds very much like the quote by Hyman Minsky and something that we talked about in a previous episode with Professor Steve Keen and Greg Ip, actually. Stability creates instability. So it's almost like freedom creates—I don't know what the antonym for freedom is.

James Brusseau:

I think the antonym would be either chaos, right? Or there are two antonyms. On one side, the one antonym of freedom is chaos, right? It's that you have no freedom because you have no control at all about where you're going. You're just being thrown wildly.

And then the other antonym would be some kind of version of incarceration or stability, right? Where you have no movement. So paralyzation would be one antonym. And the other antonym would be chaos. Freedom is somewhere in between there, right between those two extremes.

Frank Conway:

If we have, based on the accursed share—and possibly if we can link it in, as you did, regarding equality and freedom—if we end up with too much of something or an excess of something, is there a possibility of waste?

And in a society, ideally, whether it's a theoretical or a real society, is there a way of distributing what we feel is waste—obviously, it's positive and could be put to use—to those who are the poorest of the poor? And I know there is some phenomenon out there that has been based on what's known as potlatch and that we have seen before in the past. Is there a society that theoretically or in reality can represent this type of thinking and that would benefit all?

Oh, I suppose there's solar power. Sorry, I suppose there's solar power. If we have solar power, I think in Germany, a lot of houses are encouraged to harvest their own energy from the sun and anything that they have in excess, they put back onto the grid and they can sell it to the government or something who will actually buy or the network will actually buy it back and redistribute it at them.

James Brusseau:

Yeah, I think probably on that front, one thing that Bataille would want to resist is the idea that you would sell it back because the notion of excess, as Bataille understands it, or the notion of an overabundance of freedom, this relates back closer to the idea of potlatch. It's something we need to get rid of without any recompense, right?

And so that's why wars are so effective in terms of the diminishing of wealth. When a nation is too wealthy—let's say two nations have excess, they have too much wealth, one very good way to eliminate wealth is just to bomb each other, right? Because there's no recompense. You don't get anything back for it.

So the task of a potlatch society, and Bataille did investigate this, but because he has a bit of a philosophical streak to him, though he was technically a librarian, that was his business, there is some question about whether or not the societies that he analyzed as potlatch societies really were potlatch societies. And I am not sufficiently versed in the anthropology to be able to comment well on that.

But what we do need to focus on is this idea of if Bataille is right, then we need to find a way to extinguish, in the economic side, freedom or wealth. We need to find a way to extinguish that without recompense, without getting anything back for it. Because if we keep getting something back, that just makes the machine worse.

Again, it's like cigarettes. We have to find a way, in a sense, to get rid of our cigarettes. Every time I give away a cigarette, someone gives me back two and I smoke those two, right? Then my situation, my need for cigarettes is just going to increase until again I finally destroy my lungs.

So that's the task on the excess side. The task of freedom in the economic world is to find a way to eliminate this excess, which is destructive but not negative, let's say. Let's put it that way.

Frank Conway:

James, is there anything that we as economists could learn from a philosopher or the teaching of philosophy when it comes to our own theoretical teachings? I know you do a lot regarding ethics as well and that's something that at the level of principles is quite absent, really.

James Brusseau:

Well, you know, the truth is I'm not sure that there is much there, I think.

I think that in a certain sense, economics and philosophy slash ethics, these are really two different languages in a way, similarly, I've tried to begin to show in our talk that the value or the discourse, the logic, let's call it, of equality is simply fundamentally different than the logic of freedom.

And so when we talk about wealth and equality in terms of freedom, we have a different kind of debate with different resources put at stake than we do when we talk about inequality in terms of the value of equality, the desire for equality.

I think that something similar could be said about economics. I think that what's interesting perhaps is not so much how they overlap but how different they are and how it is that these very different languages with very different presuppositions and very different basic references and very different fundamental goals, what's curious is how we can relate to each other.

It's not what we have in common but rather how it is we are so fundamentally different that there is some harmony, right? We're having this conversation. There is this harmony.

So I think that the kinds of things that I would like to think about there would be not so much what they have in common but how they interact, perhaps, as things are completely different, how they would affect each other, but not how we could talk to each other.

Frank Conway:

James, would you have any recommended books for our listeners that might want to expand or even be introduced to your type of thinking in terms of philosophy?

James Brusseau:

Well, my type of thinking, I think the Georges Bataille book would be quite good.

Curiously, one of the centers of the way I think about these issues is Gilles Deleuze. He wrote quite a bit about Marxism, but he was also part of the generation of '68 in Paris. And so the kinds of relation he had with Marxism was more cultural and historical than intellectual. So I would recommend Deleuze highly, but I would recommend to not worry so much about his relationship with Marxism.

I might say that it would be very curious to see. Let's take this book, Kafka's book Toward a Minor Literature, which is a very short book, an easy book. And it's about the way that Kafka works within a language distorted to create a new language, his minor language of short stories. It would be very interesting to see how an economist could, say, take that book and those ideas about, again, the fundamental idea—how can creativity work?—and try to apply that to some kind of economic question.

For example, how does innovation work in economics? This is an example of what I tried to indicate, I think somewhat sloppily before when I said what's interesting about philosophy and economics is not how they're the same but how they're different.

This is a concrete case of that. What would be interesting to see is how Deleuze's idea about how a language can be created within a language, how that would apply to the economic study of how within, say, a marketplace—an established marketplace—innovation happens.

In what ways do forces move in parallel directions or in what ways do the forces not overlap each other? I think that might be kind of interesting.

So if I were going to recommend, I would, of course, recommend Bataille's The Accursed Share. I would recommend Gilles Deleuze and Kafka: Toward a Minor Literature.

And then another book that people should look at, we haven't had a chance to talk about Robert Nozick, but the Nozick book on anarchy has some good chapters. It's a long book, but there are some good chapters there about the ethics of freedom in the marketplace.

Frank Conway:

Excellent. I'm just jotting these down and I'll put all those books on the show notes page and also your own as well, James. James, again, if you visit jamesbrusseau.net—that's B-R-U-S-S-E-A-U—you'll find a list of your four books, James, and a number of them are actually PDFs, so people can actually freely download, right?

James Brusseau: (speaker uncertain)

Our secret, but yes, yeah.

Frank Conway:

It's out there anyway for those who are listening. And I again check out your documentary or your workshop on the wealth inequality and you can find it on WealthInequalityWorkshop.org.

James, is there any parting advice that you'd like to leave with us? I always love it when I get a chance to read some of the philosophers and some of the deep thinking there. Is there some parting advice that you'd like to share with us?

James Brusseau:

My advice is I've learned quite a bit listening to the discussions you've been having with economists, and I hope that I've been able to provide some spark of interest for people who are perhaps more interested in economic kinds of issues than philosophical ones.

I believe my advice is to keep trying to repurpose philosophy for economics, keep trying to repurpose economics for philosophy and so on. That would be my thought.

Frank Conway:

James, thank you so much for joining me on Economic Rockstar. I had a blast and I personally learned a lot from you. Share again with our listeners where they can find you.

James Brusseau:

Thanks for having me, Frank. Again, what we discussed here today was wealthinequalityworkshop.org.

Frank Conway:

And you can find all the links, as I mentioned again, on economicrockstar.com forward slash James Brusseau. James, thank you so much for being so generous with your time. You are an economic rock star.

James Brusseau: (speaker uncertain)

Thank you.

Frank Conway:

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James Brusseau:

Well, it's good when you force me to ask those questions about economics. It does force me to see things a little bit differently. So it's very enjoyable. Thanks again, Frank.

Frank Conway:

Thanks a million, James. All the best. Thank you. Bye.

James Brusseau:

You too.