This post kicks off a symposium on Alyssa Battistoni’s Free Gifts: Capitalism and the Politics of Nature. Look forward to responses from Rob Hunter, Jed Purdy, Madison Condon, Amna Akbar, and Corinne Blalock.
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It will come as little surprise to readers of this Blog that the most cited legal paper of all time was written by an economist. Ronald Coase’s “The Problem of Social Cost,” published in the Journal of Law and Economics in 1960, took aim at Arthur Pigou’s theory of the external effects of economic activity, and with it, at the foundations of welfare economics.
In his 1920 book The Economics of Welfare, Pigou had identified a class of cases where prices failed to reflect the effects of production on society at large, which he deemed “external economies”—or as we know them today, externalities. His central example, destined to become the textbook case, concerned a factory with a smoky chimney. Writing in early twentieth century Britain, Pigou observed that the ubiquitous smoke imposed literal costs on the community at large—“injury to buildings and vegetables, expenses for washing clothes and cleaning rooms, expenses for the provision of extra artificial light”—none of which were reflected in the cost to the factory owner. In such cases, markets fail to produce socially optimal outcomes, he argued, and so the state was justified in intervening by imposing a tax to make private actors “internalize” the social costs of their actions.
Coase offered a wholesale assault on Pigou’s framework. His main objection was straightforward: The smoke from the factory would only have harmful effects on health if people chose to live nearby. Thus, he concluded, both parties “cause the damage.” Why, then, should the factory owner have to accept the cost of reducing smoke? The goal, Coase argued, shouldn’t be to eliminate smoke altogether, which might make everyone worse off, but rather to “secure the optimum amount of smoke pollution,” defined as the “amount that will maximize the value of production.” To achieve this, he proposed making the right to pollute into a commodity whose price could be set by the market. The paper would eventually become one of the foundational texts of the law and economics movement.
Climate change emerged on the political agenda a few decades later. Since then, the externality has been the central frame through which climate change has been apprehended and addressed: as the economist Nicholas Stern famously put it in 2007, “Greenhouse gas emissions are externalities, and represent the biggest market failure the world has seen.” This core analysis has underpinned the most prominent policy tools brought to bear on climate change, from the (Pigovian) carbon tax to the (Coasian) carbon market.
Yet the gap between this framing of climate change as a relatively minor and technical error and the political discourse in which climate change is routinely declared an “existential threat” to life on Earth is bewildering. It’s a disjuncture that has long troubled me, and that Free Gifts sets out to investigate. What Pigou and Coase describe as externality and social cost is, the book argues, an iteration of a longer-standing problem: that which Marx describes, in his critique of classical political economy, as the free gift of nature. Whereas thinkers like David Ricardo and Jean-Baptiste Say had described nature’s contributions to production as gratuitous gifts to humanity in general, Marx charges that nature gives only to capitalists. But the free gift itself is an underexplored and undertheorized concept, with more profound consequences than it is often taken to have.
For in fact, the problem of missing prices is not exceptional, as externalities were once thought to be, but pervasive. It is evident not only in the unpriced harms of pollution and carbon emissions, but in the unvalued benefits provided by ecosystems which keep our planet habitable—often described by economists as ecosystem services or “natural capital.” It is visible, too, in more surprising places: in the often unwaged work of reproducing human life (indeed, the book began as an effort to investigate the parallels between unwaged housework, as extensively discussed by Marxist feminists, and the unvalued work of nature) and even in the cooperative waged labor of human beings. To understand what connects these phenomena, I argue, we need to look beneath the appearance of price—or lack thereof—to understand the social relations beneath. The book therefore draws on Marxist value form theory to develop a more thorough critique of the free gift as a capitalist social form.
In Capital, Marx famously identifies the commodity as capitalism’s elementary social form, characterized by its dual character: the commodity has use value but appears in the form of exchange value; it is at once concrete and abstract, natural and social. Most Marxists since have tracked the spread of the commodity form, showing how more and more of the world is brought into its orbit. Yet while capitalism is typically said to commodify everything, much of what makes up our world isn’t commodified at all. Things which do not take the form of the commodity instead appear in the form of the free gift: a social form which describes the condition of usefulness lacking value.
The core chapters of the book try to cash out these theoretical arguments by attending to the problems that have arisen around the paradox of the free gift, from pollution to diminished biodiversity, and how they have been understood within more mainstream traditions of social science, from economics to political science to law. There, it engages not only Coase and Pigou but other major figures of twentieth century social science, from Garrett Hardin to William Baumol to Herman Daly, reading their ideas as efforts to grapple with phenomena that the methods of mainstream social science can’t quite grasp. It returns, too, to major debates within Marxism, from Marxist feminist debates over the status of domestic labor to arguments over the relationship of peasants to capitalism.
The idea of the free gift, I argue, can help us grasp the connections between these seemingly disparate phenomena and give us a deeper understanding of the environmental problems that plague contemporary capitalism. It can help us understand what’s happening to nature under capitalism, in other words. But it can also help us to better understand capitalism itself. The free gift, as the commodity’s shadow, draws our attention to interstices of capitalism which are often overlooked even by its critics. While Marxists tend to focus on the ways that capital abstracts away from the physical world, the free gift brings into view things which have material effects but which tend not to appear in the form of exchange, and directs attention to how concrete elements of production processes inform the accumulation of abstract value. It shows us not only the things that capitalism absorbs, but those it abdicates, neglects, and expels.
Free Gifts is, primarily, a work of critique; it does not offer an immediate policy program or political strategy. I hope, however, that it can inform both. Take, for instance, struggles over the classic example of social cost: the smokey chimney and its effects on nearby communities. From the left, these have typically been framed in terms of environmental justice, highlighting the uneven distribution of pollution and the disproportionate effects on working class communities and communities of color. While I draw on these analyses, I also locate pollution more firmly within the hidden abode of production itself, reading it as the byproduction of surplus matter alongside commodities, and identifying the forms of class power that allow some people to impose material harms on others in the pursuit of profit. The upshot is that we should understand struggles over pollution not as “new social movements” arising around “social issues” beyond the traditional questions of political economy, but as class struggles at the point of production in their own right, and thus as challenges to capitalist rule.
This, in turn, can help us see both political projects and policy tools in new light. The rights of nature framework, for instance, was motivated not only by recognition of nature’s sheer intrinsic value, but as a response to none other than Coase’s problem of social cost: Christopher Stone’s landmark 1972 article “Should Trees Have Standing” suggested that locating rights in natural entities could help solve the problem of transaction costs associated with pollution. If a lake could bring a claim against a polluting factory nearby, it could effectively aggregate the interests of all the people living around the lake—as well as those of the fish and birds and plants living in the lake. The rights of nature, then, might be understood less as an extension of human rights than multispecies collective bargaining rights.
These ideas are more gestural than fully-fledged. But I hope they might spark new ways of thinking about familiar problems, and in turn, new ways of confronting the daunting political challenges we face. What’s wrong with capitalism, the book ultimately argues, isn’t just that it “destroys nature,” but that it compels us to treat the more-than-human world as a free gift. The task before us is not to assert nature’s intrinsic moral value, but to decide what our values are collectively as we decide how to live together on a planet that will be changing long into the future.
I’m grateful to the symposium contributors for engaging the book and look forward to the discussion.
