Root Values of Modern Commerce

I have read numerous histories of commerce, many on the industrial revolution, but I have never been satisfied. The changes in attitudes that have created modernity have been too slow to measure and too subtile to verify.

I have traveled in several traditional societies from India to West Africa. What I have seen in my travels is a clear difference in the world view of my peers in urban America and the world views of my many friends who live in traditional societies. The difference is relevant to the issue of finding the roots of modern commerce. Our history, as Americans, of being immersed in modern commerce has probably generated some of the differences in world views between ourselves and traditional peoples. It think the issue is worth pursuing.

I suggest that we, modern urbans, hold some radical world views that are the byproducts of the commercial world we inhabit and conversely our world views encourage the expansion of commerce. We probably don't see how radical our views are and therefore ignore their sub-strata contribution to the vitality of commerce.

Here are four of the world views that I believe form the substrata values of modern commerce:

1. I deliberately state the first world view in its most radical and shocking form: "employees and lumber are no different". What we would say to be more expansive is: "You tear down a wall and most of the studs and lumber get recycled or thrown away. You fire employees. Some protest and require legal settlements, but you fire employees when necessary in business. Most people who get fired go on to get other jobs.

We all know that this statement is an exaggeration. Most business managers are more reluctant to fire employees than to tear down an interior wall; they have financial and emotional reasons. Financial because training, skill and knowledge have been invested in employees. Rehiring and retraining is costly. Many businesses are loathe to fire employees. In Japan and Europe the laws and traditions mitigate against firing to a far greater extent than in the U.S.. It is emotionally difficult because families friends and fellow workers are adversely effected; even in tight labor markets, it takes time to find another job, lives are disrupted. Unions exist to make sure that employees are fired as seldom as possible.

Nevertheless the statement in its baldest terms is pretty much accepted by Urban Americans. When we hear or read that employees are fired, 10,000, 20,000, that a company with 400 employees has closed, it has no emotional impact. That GM, Procter & Gamble or Merrill Lynch did it, is of no consequence to us in buying cars, paper products or trading securities.

The spread of this practice (discretionary employment) is partly the consequence of the efficiency that it offers industrial commerce. It increases efficiency by making labor costs variable so that they rise and fall with sales. It is partly used in business because we the public and we the consumer accept its validity.

I suspect that we would also love to see the practice of discretionary employment spread to government and universities. We should not ignore the depth of our feeling about making government employees subject to firing. It has a bearing on the reason we are modern people. We would love to see it spread to government because we believe that discretionary employment is beneficial for society. We believe that it makes employees (and managers too) work harder and more efficiently.

2. We can find beauty and genius in mass produced objects. We have silverware and dishes, glasses, cameras, watches and laptop computers that we consider exquisite and sometimes the work of genius. These can be objects which exist in the millions and tens of millions.

This perception is central to the existence of a thriving industrial commercial society. It is an a priori root of strong consumer demand, it is the source of economies of scale in production. It is not the least bit "obvious" to a person in a traditional society. In America we still have the old idea visible in our separate academic departments of Fine Arts, Crafts and Design. Single pieces, multiple pieces and production line.

3. The next style can be just as wonderful as the current or past styles. We accept "style", which is a euphemism for "recurring superficial change" as positive. We all know the story of how GM caught and passed Ford as an automobile producer in the 1920's. At much higher prices GM demonstrated that consumers wanted variety and custom design elements. Consumers in that case, and in nearly every other case, associate style with improvement and personalization. Which it sometimes is.

I attended a class in India that was trying to create business entrepreneurs. A whole semester was on the subject of "improvement" a concept that was quite alien to the traditional Indian mind.

Acceptance, even enthusiasm for style is a generator of a vast consumer market and a commercial world that is much bigger than it would be without style.

4. Money for children to spend as they wish, mothers in the work place and a great dinner out. All three of these elements are part of a world view that places the traditional family on a much lower level than commercial values. The first is praised because it elevates the judgment and independence of children, it is educational, the second and third because we value the independence and positive self fulfillment that they offer to mothers. However, these are contrary to traditional values of what a "good" family is all about. These values favor purchases in the marketplace over "homemade" and support individual consumer identities at the expense of much else.

Summary

We hold views that seem self-evident to most of us. However, these are recent views, alien to traditional people and probably alien to our ancestors. These views are the by-product of living in a modern commercial society and they are the basis for the extension and the expansion of that commercial society.

Too Bad

Many of my friends, politicians included, bemoan the prevalence of every one of the four world views that I have identified as the basis for modern commerce. Many people in our society see how these new values destroy older family and New Deal values. Ideological liberals and conservatives bemoan the casual nature of the labor market, the dehumanizing nature of mass production, the triumph of trivial style and the sad demise of even the nuclear family. The family farm is gone, the neighborhood and the Norman Rockwell world are gone.

Commerce needs some distinct values to thrive. I think it particularly needs the ones I have identified here. Commerce also has created these values.

Commerce in the 19th Century and the early part of the 20th Century created such havoc with the changing values that it brought to traditional people (Russians, Chinese, Lao...) that revolutions against modern-urban-commerce were common occurrences. Many of these societies are today slowly accommodating to industrial modernity.

Today, for us Americans, who already inside the world of commerce, individuals who hold onto the values to tradition have become "sentimental" consumers. They are wonderful members of a market that buys antiques, old Saturday Evening Post magazines, Craftsman houses, classic cars, frilly greeting cards, wear granny glasses and support Fundamentalist churches.

 

Michael Phillips, Dec. 2000