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Theoretical and Applied Economics
No. 5 / 2011 (558)

The Fall of Hierarchical Systems

„The hierarchical control of power has failed as a generator of wealth, the hierarchical control of wealth is starting to show signs of failure in realizing the access to power.”

Among other challenges thrown by capitalism which have not received a rational answer there is truly fundamental one: are economic crises a part of the essence of the system? The mechanical perception of the problem may explicitly suggest the interpretation of the challenge; which means that the capitalist system - as a societal formula of organization interested in attesting the truth on the path of efficiency - should not go through recursive stages of near-crisis. The base of this positive construction, capitalism, a developer of efficient order in the form of the accumulation of the specific substance called wealth, would never know cyclicity but only progress.

As any other theory built on conceptual simplification, capitalism underwent a determinist structuring by reduction to the key role of one element. The assertions are consistent with the fundamental hypothesis of the absolute core-quality of one factor, vectored by a centripetal force, all other factors responding to the opposite, centrifugal movement. In other words, capitalism -within its essence which is centripetally based on wealth - is both homogenously substantial as it is linear, with a non-contradicting behavior. From this point of view, the solution offered by capitalism to the relations between the economic and the social environments only differs in sense from the antithetic response offered by the other twin system, socialism, which is centripetally based on power. Socialism has itself developed the ethos of non¬contradiction, its cycles being declared as a leap in quality, an illustration of the implacable progress invoked by the rationalists of the Enlightenment.

As societal systems, both capitalism and socialism viewed themselves as being natural, and therefore perpetual. The defect of these visions resides in the fundamentals' lack of equilibrium, fixating them with unilateral terms and without the structuring force coherent with the way for the creation of constitutive forces. Both wealth and power generate hierarchical control systems, thus socialism was bogged down as a system for the hierarchical control of power, while capitalism encounters crises as system for the hierarchical control of wealth.

The similar, systemic trait of the hierarchical control determined by the centripetal element is the source of the state of crisis. The hierarchy generates the crisis through polarization: in the case of socialism, between the party and the people with regard to freedoms; in the case of capitalism, between the owners and the non-owners with regard to resources. The collapsing of socialism is explained, paradoxically, through the fact that the polarization regarded solely an individual value which was a determinant of a social crisis, while the systemic crisis of capitalism becomes more evident through the polarization of a social value as the substance of individual wealth.

The hierarchical control of power has failed as a generator of wealth. The hierarchical control of wealth signals failure in instrumenting the access to power, as long as wealth deals the cards of power. The state of crisis constitutes a given of hierarchical systems, the crisis essentially acting in a systemic manner. The recourse to market through which socialism tries to avoid the effects of a system crisis is replicated capitalism's resort to state interventionism in order to encapsulate the system crisis. The behaviors of hierarchical systems mirror each other: the genetic similarity determines the identification with the same form, unchanged by employing tailoring means and procedures differentiated by fashion.

A difference must be pointed out though, between the crisis as a moment in the cyclicity of the capitalist system and the system crisis - which is that type of crisis leading to the collapse of a deviant form of the system. Relevant today is the crisis in the form of the casino-economy which was stimulated by the capitalist system.

In the entrepreneurial-type of capitalism freedom is corporatized, the state entering the structuring phase of an absolutist type - in the sense of an entrepreneurial state, within the limits of which the democratic access to power is being mimicked. The state of crisis extends from the social to the forms of administration of order in a global sense. The sign of the system crisis is the intolerance to the different, the road to collapse being opened by the violent control of freedoms.

The system thus renounces its consequences in order to sage it premise, but the unintended effects categorically cancel the validity of the premise. The correction cannot be found on this path which is generated by the deviant system of exclusive, entrepreneurial capitalism, but it requires a return to the forms of the permissive capitalism, interested in democratizing wealth and in liberalizing power.

Overcoming the system crises requires the humanization of the capital and the rationalization of the social, these being possible only by coming out from the logic of hierarchical and opaque to inclusion type of systems.


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The Fall of Hierarchical Systems
Marin Dinu

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