The Economy of Collapse or Why Homeless Lives Matter

My grandmother liked to tell me her stories of her childhood. It was a world of extended families where women never worked and where her Orthodox Jewish father had one modest income for the family of 13, but nobody ever had a situation when they have nothing to eat. It was the world of poverty without electricity and even without reliable roads for horse coaches where nobody ever was homeless and had no place to sleep. Now, more than one and a half centuries later, we have computers and sophisticated fancy gadgets substituting for the work of thousands of people and kicking out these people from their homes. We are told that this is happening due to the laws of a holy sacrosanct market which could only be worshiped, but never changed; and anyone who dares to question such fundamental truth as sanctity of market is risking to be labeled as a liberal pussy, communist or any other kind of “ist” depending on the intellectual level of the conversation.

I do not have a degree in economics, but a few courses of History from the best university in Russia have given me enough facts to claim that fighting homelessness and poverty is not a liberal or democratic issue, but an economic and political necessity without which the whole structure of society can collapse. So even those for whom humanism is an H*word, and helping other people is at best foolish, have to accept the urgent need to address the problem of homelessness to prevent gradual erosion of social norms.

The Myth of the Free Market

We are trained to believe that the market is a fair and almost scientific definition of value. To put it simple, market could be defined as a number of exchange interactions in society at a given period of time. In other words it is a number of decisions of individuals and groups of people, and as such a market is absolutely unscientific, but can rather present a number of collective illusions at a given time. History abounds with examples illustrating the human factor of the market from the time of creation of the first stock exchanges.

A few years after establishing the first stock exchange in Amsterdam the tulip bubble destroyed the economy of the Netherlands. Tulips were introduced into Netherlands from Turkey, and Dutch people were unaware about the number of bulbs which could be potentially available on the market, so in a short term the price of tulip bulbs almost reached real estate levels. The bubble of such scale caused by human mistake is of course impossible nowadays in the information age, but phenomena of similar nature are happening on an everyday basis.

Another myth of the market is its alleged freedom from regulations. The commonly used term free market is used to differentiate the capitalist model from the central planning of socialism. However, it is common knowledge that most of the commercial operations in any civilized country are taxed and tightly regulated by state laws. A market by itself does not define who can sell and buy guns, which medication could be bought without prescription, how long is the workday for a particular profession and countless other questions.

So what kind of market regulations are so scary for neoconservatives if commercial interactions (ie market) are by definition regulated by the laws of the state? Of course, they are talking about Social Programs. All other government expenses like military, law enforcement, prisons etc are usually met with understanding, but God forbid government will spend one dollar more on social programs!

Dr. Kohlberg’s dilemma

One of the greatest contradictions of the contemporary social thinking lies in the fact that though in economics it sanctifies the free choice of the customer, politically it over-relies on law enforcement and punishment as a means of crime prevention. But fear of punishment only work for sociopaths who constitute tiny portion of population. Most of us do not take somebody else’s belongings not because of fear of being caught, but because we are able to understand and identify with the pain of loss which will be experienced by the owner. Many people know that it is not too difficult to steal from the supermarket. Due to my ability to space out and make unconscious movements, I took out things without paying many times, but always returned them.

As many other people who just can’t steal, we do not do it not out of the fear of being caught, but due to respect of law; because we don’t see much difference between stealing from a person or group. But those who forced to violate laws in order to survive find taking from big corporations more acceptable.

In his famous psychological experiment professor Lawrence Kohlberg offered students the following dilemma: A woman was near death from a special kind of cancer. There was one drug that the doctors thought might save her. It was a form of radium that a druggist in the same town had recently discovered. The drug was expensive to make, but the druggist was charging ten times what the drug cost him to produce. He paid $200 for the radium and charged $2,000 for a small dose of the drug. The sick woman’s husband, Heinz, went to everyone he knew to borrow the money, but he could only get together about $1,000 which is half of what it cost. He told the druggist that his wife was dying and asked him to sell it cheaper or let him pay later. But the druggist said: “No, I discovered the drug and I’m going to make money from it.” So Heinz got desperate and broke into the man’s laboratory to steal the drug for his wife. Should Heinz have broken into the laboratory to steal the drug for his wife? Why or why not? (Quote from Wikipedia)

It is characteristic that from neither of the linear answers “yes” or “no” reveals anything about the moral maturity of the person, and one of the reasons is that nobody can exactly predict how they will react in the real life situation. But what matters is argumentation: why are you ready to make this or that choice. In reality, however, no matter what your argumentation was, it would be a lose-lose situation without any honorable resolution for normal human being, and blessed are those who do not have to resolve such dilemmas in their real lives.

Some of the homeless people who shoplift are doing it to get food or a place to stay in the rainy day for their sick partners, so they are facing a situation very similar to one which Professor Kohlberg offered to his students. Posed by society in no-win situation they pass to people around them their desperation. So blessed are those who didn’t have to resolve Dr. Kohlberg’s dilemma in real life. They still can see the world in pink, and believe that prisons are built for those dangerous and disgusting people who have to be isolated anyway.

In the country named USSR the Gulag was built for good, probably the best people – those who were educated beyond the limits permitted by the communist party. As a result, in certain areas, especially in places of residence of minorities, hate and distrust of police was so strong that people preferred to suck any injustice, but not to report a crime or cooperate with law-enforcement. That was already an advanced stage of decay of the system of a dying state. It starts when considerable amounts of the population face Kohlberg’s dilemma in real life and passed desperation to their friends. Hopefully we in America are still far from this point of no-return.