Okay, let me just add a new wrinkle to our ongoing debates about the value of capitalism. What I want to show here is the impact that capitalism can have when a society is incorporated into the markets. My goal here is not to debate the comparative merits of any so-called communist or socialist systems, or even to suggest any future course of action. I just want to try and illustrate how the the introduction to markets actually introdoces poverty into societies that didn't have it before.
I'll use the example I know best; Navajos. (Sorry for the length.)
The Navajo economy from around 1100 AD to 1864 could be described as a varied subsistence economy, operating on a domestic scale. By this I mean that a variety of products were produced for the consumption of the very households that produced them, and that there was no incentive to generate significant surplus. What trade occured was not done for profit, it was mostly just barter; a good I happen to have in surplus for one that I have too little of.
What did they produce in the way of food? (I'll use the post-contact menue, in fact one emerging in the 1700s.)
Hunting: Deer, elk, antelope, and various small game, a little fishing (some clans have proscriptions against eating fish).
Gathering: Pinion nuts, herbs and medicines, root crops, etc,
Agriculture: Corn, Beans, Squash (the Holy Trinity of N.A. crops), melons, Peaches (in some areas), and a few other things.
Livestock: Sheep, goats, cattle, and horses.
Exchange: Trading, mostly with Pueblos and the Spanish, and also with Apaches; occasionally with Utes. Also raiding (there was an extensive slave trade in the Soutwest, one in which Navajo children were the primary victims, but it also included others).
Prior to 1864, sheep would already have provided the main form of livestock, but agriculture would have been the primary source of food overall. They would have generated little more than they needed of any given thing, but the variety of resources made the economy flexible. If for example the crops are bad one year, you hunt a little more, or perhaps butcher a few sheep.
In 1864 Kit Carson burned the crops, destroyed the homes, and killed the livestock, and cut all the peach trees down. As winter approached, the majority of Navajos surrendered to U.S. forces and were interned at a concentration camp in Southern New Mexico (Fort Sumner). (I can't resist: Part of the idea here was to teach them how to farm, which was of course precisely why their CROPS had to be burned.) Anyway, this didn't work out (a long and morbid story), so they were allowed to return to a portion of the homeland, which eventually grew into the present-day reservation of about 25,000 square miles.
The post Sumner economy was different in a number of respects. Raiding was now out of the question (a Navajo police force saw to it that captured livestock would be returned), and the primary trading partners were now Anglo traders who set up stores on the reservation. The Anglo traders acted as agents of the market economy, and sought out the goods which could be sold most profitably in other markets. The primary good they sought was wool and other sheep products such as blankets. So, this became the focus of Navajo production. Less time was put into all the other activities. Do you need vegetables? Well don't spend too much time in the garden, just raise a few more sheep and use them to secure canned vegatables. Need cloth? Why weave all of it or hunt for leather, just trade a few sheep for the traders cloth. This is the typical fomula of raw materials for finished products that capitalism offers new participants, and it leads to dependency. With so much effort placed on a single product, Navajos had to trade, and if anything disrupted that trade, they were the ones to suffer.
But something did disrupt that pattern. Th southwest got drier, even as Navajo herds got bigger. By the 1930s, the BIA and the Soil Conservation Service became convinced that Navajos were overgrazing the Southwest, and that aside from the erosion on the land itself, this would eventually silt up Hoover Dam. So, the herds were forceably thinned, and a permit system was initiated, one which had the effect of breaking up families (and actually undermining indigenous techniques of land management). The end result was a destruction of the local economy, and nothign to replace it except wage labor in off-reservation settings, or alternatively; government subsidized jobs on the reservation. Over time, federal subsidies become the primary cash crop for the Navajo Nation, making the heavily dependent on the U,S, government.
So what does this (very abbreviated) little history lesson illustrate? Among other things, the role that market values play in reorganizing indigenous economies in such a way as to weaken their chances for long term survival. The dependency on the Navajo Nation started with the traders, not the government subsidies of the post-30s economy. It was the influence of the market that destryed local subsistence economies, and seduced the Navajo people into monocrop production, and that is what made the livestock reductions of the 30s and 40s so destructive.
I'm no advocate of socialism or communism, and I don't pretend to know all the answers to third world debt. But for those who advocate capitalism as the answer to third world poverty, this and countless similar examples, provide the reason so many of us are skeptical about this formula. The assumption seems to be that the worlds poor were always poor, and that they will continue to be so until they learn how to function as capitalists. I have been repeating time and again that it is the onset of capitalism that has created widespread poverty throughout the world, and providing this brief example is my attempt to explain how that happens.
Anyway, rant over.
I'll use the example I know best; Navajos. (Sorry for the length.)
The Navajo economy from around 1100 AD to 1864 could be described as a varied subsistence economy, operating on a domestic scale. By this I mean that a variety of products were produced for the consumption of the very households that produced them, and that there was no incentive to generate significant surplus. What trade occured was not done for profit, it was mostly just barter; a good I happen to have in surplus for one that I have too little of.
What did they produce in the way of food? (I'll use the post-contact menue, in fact one emerging in the 1700s.)
Hunting: Deer, elk, antelope, and various small game, a little fishing (some clans have proscriptions against eating fish).
Gathering: Pinion nuts, herbs and medicines, root crops, etc,
Agriculture: Corn, Beans, Squash (the Holy Trinity of N.A. crops), melons, Peaches (in some areas), and a few other things.
Livestock: Sheep, goats, cattle, and horses.
Exchange: Trading, mostly with Pueblos and the Spanish, and also with Apaches; occasionally with Utes. Also raiding (there was an extensive slave trade in the Soutwest, one in which Navajo children were the primary victims, but it also included others).
Prior to 1864, sheep would already have provided the main form of livestock, but agriculture would have been the primary source of food overall. They would have generated little more than they needed of any given thing, but the variety of resources made the economy flexible. If for example the crops are bad one year, you hunt a little more, or perhaps butcher a few sheep.
In 1864 Kit Carson burned the crops, destroyed the homes, and killed the livestock, and cut all the peach trees down. As winter approached, the majority of Navajos surrendered to U.S. forces and were interned at a concentration camp in Southern New Mexico (Fort Sumner). (I can't resist: Part of the idea here was to teach them how to farm, which was of course precisely why their CROPS had to be burned.) Anyway, this didn't work out (a long and morbid story), so they were allowed to return to a portion of the homeland, which eventually grew into the present-day reservation of about 25,000 square miles.
The post Sumner economy was different in a number of respects. Raiding was now out of the question (a Navajo police force saw to it that captured livestock would be returned), and the primary trading partners were now Anglo traders who set up stores on the reservation. The Anglo traders acted as agents of the market economy, and sought out the goods which could be sold most profitably in other markets. The primary good they sought was wool and other sheep products such as blankets. So, this became the focus of Navajo production. Less time was put into all the other activities. Do you need vegetables? Well don't spend too much time in the garden, just raise a few more sheep and use them to secure canned vegatables. Need cloth? Why weave all of it or hunt for leather, just trade a few sheep for the traders cloth. This is the typical fomula of raw materials for finished products that capitalism offers new participants, and it leads to dependency. With so much effort placed on a single product, Navajos had to trade, and if anything disrupted that trade, they were the ones to suffer.
But something did disrupt that pattern. Th southwest got drier, even as Navajo herds got bigger. By the 1930s, the BIA and the Soil Conservation Service became convinced that Navajos were overgrazing the Southwest, and that aside from the erosion on the land itself, this would eventually silt up Hoover Dam. So, the herds were forceably thinned, and a permit system was initiated, one which had the effect of breaking up families (and actually undermining indigenous techniques of land management). The end result was a destruction of the local economy, and nothign to replace it except wage labor in off-reservation settings, or alternatively; government subsidized jobs on the reservation. Over time, federal subsidies become the primary cash crop for the Navajo Nation, making the heavily dependent on the U,S, government.
So what does this (very abbreviated) little history lesson illustrate? Among other things, the role that market values play in reorganizing indigenous economies in such a way as to weaken their chances for long term survival. The dependency on the Navajo Nation started with the traders, not the government subsidies of the post-30s economy. It was the influence of the market that destryed local subsistence economies, and seduced the Navajo people into monocrop production, and that is what made the livestock reductions of the 30s and 40s so destructive.
I'm no advocate of socialism or communism, and I don't pretend to know all the answers to third world debt. But for those who advocate capitalism as the answer to third world poverty, this and countless similar examples, provide the reason so many of us are skeptical about this formula. The assumption seems to be that the worlds poor were always poor, and that they will continue to be so until they learn how to function as capitalists. I have been repeating time and again that it is the onset of capitalism that has created widespread poverty throughout the world, and providing this brief example is my attempt to explain how that happens.
Anyway, rant over.
