In the story, a woman who was the sole lessee on an apartment in Clinton Hill was discovered to be renting out her other rooms at prices that basically subsidized her own room. She was overcharging her roommates, mostly Craigslist types who were there for short periods, by not telling them the true rent of the apartment or what she was paying for her room — which ended up being like $250/mo. The roommates, one of which is my friend, discovered this after the lessee left the apartment and lease. None of the roommates thought to find out how much the apartment really cost before she left.
The arrangement she schemed up for herself is common practice in NYC apartment world — arguably the default when you rent a room in someone else's apartment — and she didn't do anything illegal. But here's the wrinkle. The woman is an avowed DSA member, a big Bernie supporter, and somewhat a friend to my friend, who was by far the lessee's longest-tenured roommate. When this exploitative arrangement was discovered, it felt like betrayal, but more than that, hypocrisy. The other roommates were all annoyed that this six-figure Condé Nast employee would profit off them (mostly servers, students, etc) but their anger alighted on the fact that she denounced capitalism while secretly being a money-grubber.
This story is prime parable status. As soon as I heard it, I tried to start gaming out what role societal capitalism played in the story, and what role we should want it to play, if any.
My starting point is that I fundamentally assume capitalism is part of the solution to the ills created by capitalism. I often find myself defending capitalism as an idea to people like this owner, this socialist profiteer. Call her SP? People like SP can frequently be found blaming capitalism for all the faults of society; it's in right now.
Once at a party, I asked someone if she agreed we were all guilty of committing the slow violence of gentrification. (I was flirtily trying to sound woke! But it is true.) She replied, "Well we can't do anything about it until we end capitalism." I hated that answer and said so. It betrayed so much of why it's easy, fashionable, and vacuous to shit on capitalism. We Brooklynites are guilty of gentrification. But rather than deal with that fact, it's easier to blame it on this superstructure that controls everything. My first problem with that statement was that it implied that there exists no policy mechanism, no cultural movement that could allow people to have a greater stake in the future of their neighborhoods. It implied that we the gentrifiers have no control over where we put our capital. But germane to this point, I also took issue with the idea that capitalism is something synthetic that can be ended and, just, replaced.
Capitalism's role in gentrification is this: it is legal for developers to raise prices on neighborhoods and kick existing people out so they can make money from consumers who will pay to live in a nice place. A law that tried to reduce the occurrence of these transactions would mostly just drive them underground — and then the people allowed to circumvent the law would be people who knew some housing bureaucrat or cop or whatever, and the money would just flow, darkly, upstream. But be sure, this relationship between buyers and sellers would be there. It is organic. It is immutable. Even if it's not a "buyer / seller" dynamic, you still have a "haver / wanter" dynamic that will play out according to some other measure of social power.
Capitalism legitimizes the reality of this relationship, acknowledges and makes space for it, and builds it into the structure of the system. The supply/demand relationship doesn't need statutory permission, and in fact, generally contravenes the statute when it's not permitted. This is why we'll never win the fucking war on drugs. When there's a market, the product tends to materialize. You wouldn't say we could win the drug war by first ending capitalism. If you mean taking away disposable income, then yeah, maybe. But the relationship between supply and demand is basically a part of nature. It's a weed in the prairie of human society. What's the black market capital of the world? Cuba, where they don't even have any fucking money but where most commerce is illegal. (Only because profits are legally proscribed as the provenance of the government, by the way. That's a world without capitalism.) Better to acknowledge and use this reality than decry it as a conspiracy.
Yes, capitalism increases inequality. It's a problem, and if we're trying to objectively look at what capitalism is, you gotta include that. A lot of bad comes from capitalism not being tempered by anything else. Capitalism is a really, really shitty ethical system, and unfortunately that's how it mostly appears in our world today, due to greed and corporatist power structures and all that. The tendency towards inequality is a negative externality that can be solved with regulation, but also must be accompanied by a social distaste for it; this bundle is basically what socialism is.
But for all capitalism's faults, I think you'd rather have the dynamo of capitalism running and control its negative outcomes than "eliminate" it totally — which, again, I'm not sure what that means because I'm not sure what you'd replace it with.
Many reasons you hear for people wanting to eliminate capitalism have to do not with its genuine flaws, like inequality or an erosion of solidarity or any of that, but simply for unpleasant realities of the world. I remember reading the exposé about Away's nutso CEO. This boss was terrorizing her CS team into long hours, low pay, psychological abuse, etc. One of the comments on the article was submitted by an employee: "I worked at Away for seven months, can confirm it was a capitalist hellhole!!!" It's so fucking stupid. You think hard labor is an artifact of capitalism? Ask the people in Soviet farms or Cuban labor camps; ask the pre-capitalist peons living generations on someone else's land; ask anyone who lives a life of struggling labor in a world without money. Capitalism does force us into the labor market, it's true, but it also provides other companies for you to go work for if Away becomes unbearable; it allows you to denominate your relationship with your employer in transactional terms that you can end. (Not everyone can, but certainly whatever college-educated startup soyboy who wrote the comment can.) Struggle, precarity, discrimination — these are facts of life that I truly believe capitalism generally improves.
I'm really trying not to sound like some free-market freak. I just believe there is something inexorable and maybe even good about building capitalism into the operating system of modern society. Judging by the speed and penetration of its adoption around the world, this is a cross-ideological, pan-cultural reality. No religion, not even a commodity has ever embedded itself in human civilization to even half the degree that capitalism has. So just from a Chesterton's fence perspective alone, this aspect of society cannot and ought not be wished away.
It does invoke the question, though, of what exactly capitalism is and what is good and bad about it. Answering this is critical to the next phase of social development. Do we need capitalism? No, it's a tool we find useful. Look I don't even really like commerce aesthetically, and I would love to move forward into a world post-capitalism. But in order to do that you need to understand what you're replacing. My only point is it's not something you can uproot by killing the billionaires. It is in there.
Which brings us back to SP, our DSA landlord. Here we have someone who knows how to spit the cant of democratic socialism but is secretly giving in to greed. (By the way, I don't think socialism is anti-capitalist. I think it's a plugin atop capitalism, an effects pedal in the signal chain of capitalism. Capitalism is the motor that creates social wealth and socialism distributes it intelligently.) SP is engaging in low-key subterfuge by not telling her tenants what the real arrangement is; she is using information asymmetry to exploit them. Sounds like a rapacious capitalist to me.
So here's the punchline of this whole fucking post. I want to ask the question: what is the role of capitalism in this story? What should it be? Because it is kind of shitty what she did. SP presented herself as a friend-type to these people, certainly to my friend, and was really using that to get money from them and have a super cheap room. So that was arguably deceitful. At the same time, the law of the bazaar always applies. Ascribe it to whatever -ism you want, put it at any point in history related to Adam Smith... caveat emptor, bitch. You cannot rely on the goodness of others, and if you do, you will be betrayed.
I think this gets us to the role of capitalism. Capitalism is not the inspiration to profit off your friends. It's true that SP's decision to do so took place in a society that gives her power for having more money and lower costs, but she makes enough to comfortably pay for the apartment and also lives in a social context that disapproves of that profiteering just as much as capitalism encourages it. Her decision to do this was plain old human greed.
Capitalism is the idea that there's a right way for her to indulge this impulse. It says that she can do this in a way that is ethical; if she's going to be greedy anyway, capitalism provides the route to legitimizing it.
Capitalism liberates the roommates from feeling offended that she is profiting off them; of course she is. It's probably what they would do in the same situation, and if they ever are in that situation, they'll be able to profit too. It seats the lease in a legal regime, proctored by the government, that guarantees rights all around the table. (This is a complete fucking joke in the context of urban housing, but the concept stands.) Most of all, capitalism tells the roommates to expect this behavior from SP; to gather the information they need to make an informed decision and to engage in the relationship not on the shifting sands of a personal relationship, but on the more stable equilibrium of mutually-maximized personal interest. This is all a "market" is: the knowledge of what's available, on both sides, so everyone can come to an equilibrium and move on with life.
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