Keywords for the Age of Austerity: Innovation in Action Part 1: Entrepreneurs, New Men, and Student Loans

An occasional summer feature here on the blog, where we will take a “deep dive” (as they say) into some example of “innovation,” as it does its sometimes nefarious, sometimes simply confusing, work in the world.

As so many of the keywords have shown, the vocabulary of austerity is deeply moralistic: austerity is framed as a just punishment for past profligacy, a form of necessary self-discipline. “We must tighten our belts,” say the service-cutting politicians, framing the nation as a regretful drunkard stumbling to the gym on January 2, ready to punish itself for its misdeeds.

Another example of this moralism, hot off the presses this morning from Hillary Clinton’s Silicon Valley CEO fundraising drive  announcement of her “technology and innovation agenda,” is her breathtakingly terrible proposal to forgive student loan debt to “entrepreneurs.” At the risk of pointing out the obvious–how is it a good or “progressive” idea to make student loan debt conditional on your profession or class? Why not forgive the debt of social workers or paramedics or teachers, who are also plagued by loan debt? This is besides the point, though, since the plan is so obviously cynical–clearly Clinton has no plan of implementing a policy that is so obviously unimplementable.

The reason, as we explored in Keywords for the Age of Austerity 4, is that “entrepreneur” doesn’t really mean anything. Joseph Schumpeter, the mid-century Austrian theorist of innovation who thought it did mean something, used it to describe those who brought about some sort of technical or organizational transformations within a firm or industry. Any precision here begins to to evaporate pretty quickly, however. In Business Cycles: A Theoretical, Historical and Statistical Analysis of the Capitalist Process, Schumpy makes an observation that would probably trouble the lawyers drafting the imaginary Student Debt Forgiveness for Entrepreneurs Bill:

It is not always easy to tell who the entrepreneur is in a given case. This is not, however, due to any lack of precision in our definition of the entrepreneurial function, but simply to the difficulty of finding out what person actually fills it. Nobody ever is an entrepreneur all the time, and nobody can ever be only an entrepreneur.

Schumps often describes the entrepreneur as a kind of mythical, allegorical character. It’s not a job description, but an ethos. Elsewhere, the entrepreneurial class are the “New Men” (in caps) who bring about “innovation.” “We will assume,” he writes, “that innovations are always associated with the rise to leadership of New Men. Again, there is no lack of realism about this assumption,” he insists–this is a a thing he sometimes does, following some admission of the mythical character of the entrepreneur with some insistence that no, it really is quite sensible and hard-headed.

not his kind of New Men

All this is to say: I doubt Hillary Clinton has any intention of forgiving entrepreneurial student loan debt, since “entrepreneur” is not a clearly defined, or indeed clearly definable category (though I am prepared to be proven wrong). For Schumpeter, what the idea of the entrepreneur seems to do is to give a narrative shape and a heroic protagonist to the upheaval turbulence of capitalism. For Clinton, the only real definition is ideological–to valorize the pursuit of private wealth as a public good.


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