Knowledge and the Austrian Understanding of the Democratic System

Mises’s individualism (see Chapter 3 and 8) is what prevents him from seeing the possibility of democratic outcomes that are anything better than an interventionist problem. This is because he sees only the individual and not the process and because he expects only self-interest (creating public choice type of issues). He fails to see the possibility of cooperation occurring outside of markets and exchange. He fails to see interactions other than private exchange or state coercion. This chapter explores these issues.

Consumer Sovereignty, Its Limitations and Problems

In order better to appreciate the meaning and significance of consumer sovereignty, it may be helpful to contrast the more extreme market-driven media discussion and the public conversation created by a public media source such as the BBC when it is in competition with private media, and profit-driven private education versus the public education system when it is in competition with private education. The pandering of private education to the customer-student has been documented as has the (quite obvious) pandering of private media, especially television, to its audiences.1

Mark Fisher (2009) writes in Capitalist Realism about the post-Fordist society, no longer authoritarian in the old traditional sense, but still a society of control, or “market Stalinism,” in which we are controlled using new lateral methods, watched over by our peers and by the culture itself. Expectations and the pressure of a dynamic society, always in flux, always © The Author(s) 2017

G.L. Nell, The Driving Force of the Collective,

DOI 10.1057/978-1-137-46839-0_9

in transition, force us to adapt and to accept the insecurity of the flexible labor market and a consumer culture that drives firms to respond to immediate demands and satisfaction of impulsive desires and instant gratification, rather than long-term or enlightened self-interest.

“The customer is always right” does produce great service, it does create consumer sovereignty, but this also leads to a culture of instant gratification and bleeds into areas better reserved for a different theory, for example, the field of education. As Fisher (2009) points out, in education, the question today is whether the student is the customer or the product. If the student is treated as a customer, schools just give students what they think they want, if treated as a product, the teacher or professor gives them their enlightened self-preference, and produce, presumably, better graduates. It would be better yet if we didn’t see education as about customers and products, and took a more holistic and long-term view.

There are also limitations to consumer sovereignty. The poor have some consumer sovereignty, over what they can purchase, but frequently it is luck of birth that determines their level of income and wealth, and this in turn determines their choices in the market. The choices, and therefore the votes or market voices, of those with less income than they would desire cannot be said to be equal to those of the consumer with excessive income, whose impact on the market, for any product, is as great as they might wish it to be.

 
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