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TRACY R. TWYMAN | Thorstein Veblen: A Biography

By Tracy R. Twyman

Copyright 1994. (Does not necessarily reflect the author’s current views.)

Born into a large family of poor Norwegian immigrant farmers in Cato, Wisconsin, 1857, Thorstein Bunde Veblen grew up a bright, reclusive, odd, lazy, and somewhat unmotivated child. He spent many hours reading in solitude, and developed a detached, emotionless outlook on life, which made it difficult for him to truly connect with people, although that didn’t seem to bother him much. Indeed, it was his remoteness from the world that gave him his sharp insight into the nature of things.

At age 17, he had still not made any plans for his education, and only learned that his parents were sending him away to Minnesota’s Carlton College Academy on the day of his departure. They had planned for him to spend his time there preparing for the Lutheran ministry, but Veblen would have none of it, writing brilliant, clever papers extolling the virtues of heretics, which earned him the awe and fear of the college staff. It was there that he met his first wife, Ellen Rolfe, the niece of the school’s president. They would marry in 1888, kicking off a rocky relationship regularly disturbed by Thorstein’s infidelity and lack of affection. After a while, he got sick of the suffocating Carlton atmosphere, oozing with piety, and left, hoping to attend a more academic college. But foul twists of fate kept him out of the educational loop for several years, until he finally managed to enter Yale University, and in 1884, secured a Ph.D. from the prestigious school.

The simple possession of a degree, however, did not ensure him professional success. That year he went home sick with malaria, and ended up spending seven years there, doing a few odd jobs, writing a few articles, and looking for better work, but mostly just sitting around. Finally, at age 34, he decided that he was still not ready to make it in the real world, and went back to grad school, this time choosing Cornell University as his stomping grounds. There he met J. Laurence Laughlin, one of thefaculty, and the two struck it up well. The next year, when Laughlin was hired as the head of the University of Chicago’s Economics department, he brought Veblen with him as a teaching assistant, giving him his first real job. The Rockefeller-owned college was dominated by the attitudes of the bourgeois class, and it was here that Veblen began to formalize his theories about the motivation for financial accumulation.

In 1899, at the age of 42, he published his first book, Theory of the Leisure Class, which was an instant success with the contemporary hep cats of intellectual discourse. In it he theorized that people sought excessive wealth more because they liked the social prestige it gained them than because they actually enjoyed the things that money can buy. The large estate, the fancy carriage, the expensive suit - all were mainly there to send a message: “I’m better than you. Look at all the cool stuff I can afford.” It implied strength, as it requires a hunter’s cunning skill to be able to seize your neighbor’s wealth. And the most important benefit of money, leisure, was also the most prestigious, the security of knowing that you’ll never have to lift a finger unless you’re sitting at a desk, you’ll never have to dirty your hands in the kitchen because you’ve hired someone “better suited” for that kind of work. Instead, you can spend your time riding horses, or playing golf, or strutting around town looking good. The assumption was made in society’s value construct that there was something demoralizing about work, and that the laboring masses were, even in their own eye, vulgar, wretched, untalented, and not worthy of respect, simply because they labored.

And that’s how the social order was kept in place. For the working class was not disgusted or even humored by this posturing; they actually looked up to these people. Instead, they were constantly trying to emulate their overlords, sometimes spending their meager earnings on top hats and cuff links to make themselves look more important, at the expense of their children’s diet. The merchants encouraged this, for it meant more money, and therefore more prestige for them. Everyone, poor, middle and upper-class, was trying to outdo his peers just for the sake of outdoing them, and desperately trying to win the approval of their financial “betters.” It was all very neurotic.

In 1904, he published another book, The Theory Of Business Enterprise, in which he described the inherent nature of the economy as like a machine, regulated by measurable laws of cause and effect, supply and demand, with labor and capital as the wiring, the ultimate goal being efficient production at reasonable prices. But such a model is only an ideal, the way it would be if it could. For in such a system, everything is sold at about the price it took to make it, so there are no long-term profits, and thus no wealthy capitalists to dazzle everyone with their presence. Yet they do exist, as we all know, and it was the effect of their presence that Veblen sought to explain.

To him, capitalists seemed to have come from outside the system and, seeing an opportunity to enhance themselves, began glomming the efficient machine with their grubby little fingers. He saw the profit hungry capitalist as working against the system, purposefully creating price fluctuations through induced shortages, monopolies, trusts, alliances with other suppliers, and a host of other schemes, caring little if the customer got what he paid for, if the shoes fell apart in a week or the bread was full of weevils, so long as he could keep profits coming.

But, besides all this dank description, Veblen did see a light at the end of the tunnel. For he believed (reminiscent of Marx) that, as the worker continued to be exposed to more and more machinery and well-regulated division of labor, his thinking pattern would be altered towards a more logical, mechanized view of things in terms of cause and effect. He would then see the giant machine of which he was a part, see how inefficient it was, realize how he as a customer was getting ripped off by the same type of people he was working for, and revolt, perhaps not with guns but with legislation, changing the economic system so that it worked out for him the way an efficient machine should.

Later, in 1921′s The Engineers and the Price System, he would outline this revolution more thoroughly, predicting that a board of engineers would be elected to do away with absentee ownership, supervise production prices, and approve the setting of prices. If this did not happen, he feared that the power of the capitalists and the abuse of the consumer would continue until all the real wealth rested in the hands of a few people, and the masses were left broke, indebted, and forced to work slave labor to pay off these debts in a newly fascist state.

In the meantime, Veblen began to pay the price for him infidelities. His reputation for promiscuity got him fired from the University of Chicago and then Stanford, and in 1911 his wife divorced him. He got a job at the University of Missouri and went to stay with a friend of his. When WWI broke out, he went to Washington to work on the Food Administration, and in 1918 became a full-time writer for the liberal Dial magazine, which dropped in readership almost as soon as he signed on. During this time he wrote several books: The Higher Learning in America; Imperial Germany And The Industrial Revolution; The Instinct of Workmanship and the State of the Industrial Arts; The Place of Science in Modern Civilization, and; An Inquiry into the Nature of Peace, and The Terms of Its Perpetuation. All of them failed to make waves.

It was clear at this point that his career was going downhill. He still had a following, whom he despised for their shallowness, but the fact that he had reached the last leg of his life without seeing his revolution come about was starting to sink in. He began to doubt himself. He moved to California, spent a few years in depressed solitude, and in 1929 he dies, just a few weeks short of the stock market crash, which would’ve been the show of a lifetime.

Where Veblen went wrong is also where Marx went wrong in predicting the future uprising and overthrow of the capitalists, giving too much credit to the stupid, swarming masses that make up the industrial class. Regardless of whether their poverty is due to lack of concentrated will or circumstances beyond their control, the vast majority of humanity, of which the working class is comprised, is, and always has been ill-educated and dim-witted. To assume that simply by being exposed to the well-regulated efficiency of machinery they would come to realize the inefficiency of the economy is pure folly. For even today the masses make daily use of simple technology such as television and electric lighting without any idea of how it works. So how would they be able to figure out how the economy works, and thus what’s wrong with it?

Furthermore, even if they did manage to figure out what was going on, chances are they wouldn’t do anything about it, just as recent government admissions about radiation testing and the Gulf of Tonkin incident have provoked little reaction. If anything, the machine has worked to the advantage of the capitalists, providing them with the ability to cut costs by throwing labor our on the streets, as well as another thing to sell to the consumer at inflated prices. And overall, mechanized production appears to have made the worker behave more like a machine, completely habitual, programmable, a tool of his oppressors without a will of his own. Press an emotional button and get the desired effect. And supposing there were government experts in charge of production and distribution, as Veblen suggests we should have, who’s to say that their decisions couldn’t be bought by the former capitalists the way congressional votes are bought today?

In addition, by painting all wealthy barons with the same brush, Veblen underestimates the intentions of some of the greatest swindlers in international banking. Surely the great majority of dollar-chasers are inspired by the desire to impress people and get laid a lot, as is evident by the mannerisms that Veblen pointed out. This is the social basis for the accumulative drive, and I venture to suggest that it is allowed to stay this way by those more powerful so that the poor spend their lunch money on $200 Nikes and the bourgeoisie on expensive cars or ivory back scratchers, thus preventing the “unworthy” from doing anything truly productive with their disposable income.

But those in with the true power base, such as the Rothschilds, the Morgans, and the Rockefellers, are not stupid people. Anyone who has studied the preliminary banking practices of Mayer Amchel Rothschild, in which he pretended to possess more collateral than he had in order to get people to loan him huge sums of money, knows that all members of this family have been bred to cultivate a cunning predatory spirit. Surely, due to this degree of intelligence, the wisdom of age, and the philosophical inquiry inspired by the occult fraternities that they belong to, they have come to realize the inherent pointlessness of accumulation for accumulation’s sake. After all, why would someone born into one of the richest families on Earth work to accumulate more just to impress a bunch of dumb proles that he looks down upon? At birth he has already received all the recognition he’s going to receive from such ventures, because he’s already heir to vast fortunes beyond most people’s imaginings, and beyond your imaginings times anything is still beyond your imaginings. So why do they do it?

Well, based upon historical accounts (somewhat recently unearthed) about Rothschild and Rockefeller-financed R& D projects involving secret lunar missions as early as the 1940s, the ultimate aim of which was to get them and their friends off the planet as soon as possible, as well as numerous other kooky science projects funded by them throughout this century, I would say that they are often inspired by a genuine thirst for knowledge, coupled with Adam Smith-like self-interest, though of a different flavor than Smith would’ve ever foreseen. Predatory, yes, but not petty. Indeed, we know they weren’t just doing it to impress people because of the great lengths they went to just to keep anyone from knowing about it.

Despite all of this, Veblen was not without his merits. He was definitely one of the first thinkers to recognize the great importance of technological change, and that it would have a tremendous effect on the economy, social structure, and thought patterns, although he misjudged its result. Also, many of his ideas about the “Council of Engineers” contributed to the development of more social control of and government activity in the marketplace. In addition, he gave us a new view of the vain, viscous business class, doing it “all for the glory”, and of the pathetic neurosis which drives the middle and working classes to emulate them. He forced his readers to re-evaluate their insatiable lust for “the good things in life”, and that is perhaps the most important lesson he could ever hope to teach.