Blame the Midas Touch

Posted on Jul 16, 2009

By William Pfaff

ATHENS—The peculiar charm of the anthropomorphic gods of classical Greece is that they were so like us, exemplifying our weaknesses and follies, inspiring the mortal occupants of Attic Greece to the invention of philosophy—the application of natural reason to the causes and meaning of existence—and to tragedy, which deals with the irony and confrontation with justice that destroys a human of noble but flawed intentions.

If one tries to draw an urgently contemporary lesson from Greek myth, the story of Midas is irresistible. It provides a commentary on our global economic and financial crisis, in which the pursuit of wealth has ruined us.

Seventy years ago, capitalism was widely thought to have failed because of the Crash and Great Depression. Following the Second World War, however, the United States was reassured by the wartime accomplishment of American industry, while in Western Europe there was less confidence. The magical promises of revolutionary change offered by fascism and communism between the wars were discredited.

Fascism in Italy famously made the trains run on time, drained the Pontine Marshes and launched an improbable new Roman imperialism.

Nazi Germany’s people were put to work by public investment, building the first limited-access national public highway system, and by rearmament. The raison d’etre of both fascism and Nazism proved ultimately to be war.

The Soviet system attracted parts of the Western working class and intelligentsia because of its romantic millenarianism, promising to make everyone happy in a new and better world, while crushing those who stood in the way.

The Cold War effectively stranded those in Western Europe and the U.S. who had been part of the pro-communist left before the war, leaving Western governments with their prewar capitalist and social democratic economic systems to rebuild.

This proved a great success; the industrial and social systems were rebuilt in Europe, with Marshall aid, and the American economy soared to meet postwar consumer demand and to create the military-industrial system Dwight Eisenhower warned against but which the Cold War seemed to demand. Whatever the fantasy that went into the latter—and there was much—all this Western economic activity was connected to utility. In all of the democracies there was an acknowledged obligation to share the wealth.

The social transformation of the United States during the 1950s and 1960s was phenomenal, due to the education of the population, thanks to the GI Bill of Rights, and to new popular housing and innovative enterprise. In continental Europe, the early postwar decades are still commonly referred to as the “glorious years.”

What brought the Western economies from that to the present world crisis was, in my view, a revolutionary theory. The American business model was changed. At some point a consensus emerged in the academic community on a new business model. This demanded abandonment of the social concerns previously expected from business, and demanded from corporations the highest possible profits.

It advocated minimal taxation and political regulation, so as to produce the highest stockholder earnings possible. It said that a rationally perfected industrial economy must be based on maximized pursuit of self-interest, and would then automatically bring the greatest possible efficiency and return.

Maximum self-interest by management would impose maximum productivity at lowest possible wage cost from labor. Free trade and globalization would produce raw materials at lowest possible cost, and maximum sales income.

Ethical responsibility (beyond minimal legality) and civic obligation would be stripped from business as obstacles to maximized profit, which the theory claimed would in the long run automatically produce the best possible outcome for society as a whole. That is the world in which we have been living.

Now, to Midas.

In the June 19 issue of the (London) Times Literary Supplement, the Exeter University classicist Richard Seaford elaborates on an argument he first made in 2004 in a book called “Money and the Early Greek Mind.” This proposed that “the pivotal position of the Greeks” in the world culture of the period they dominated came largely from their invention of money.

Until money, an individual’s possible possessions had to be tangible, useful and necessarily limited enough to enjoy and control. One can directly possess only so much property, herds and ships, or enjoy only so much food, sex, honors, reputation and so on, before being satisfied (or sated). But you cannot possess too much money, because money is fungible, transferable, portable and theoretically unlimited in quantity.

Money thus isolates the individual because it removes him from the real world of relationships, property and useful things, to the world of potentially unlimited possession of something whose essential characteristic is that in itself it is useless. It destroys limits in society and in human relations because it places the individual, or a society, in a position, as Seaford says, of “predatory isolation.”

This was the plight of Midas. He could not drink, eat, touch or love, because anything and everything he touched turned to gold. He bore the worst of curses—which he had himself invited. He begged for mercy from the god Dionysus, who lifted the curse. Who will lift the curse from us?