Corporate Heaven: Machiavelli and the Market State – Blog No. 48.


Niccolo Machiavelli

“Have we wolves not got a plan for you sheep?!”

After I left the army in 1970, I took a Southampton University degree in Politics & International Relations. On our reading list was “The Prince” by Niccolo Machiavelli. Click: Machiavelli To properly understand his writings one would have to read several others of his works. I never read his other works and therefore I failed to appreciate the extent of his significance.

Last week I redressed the situation. I read a book, which opened my eyes and brought home to me the extent to which Machiavelli’s political philosophy has been misinterpreted and his significance underestimated.

Bobbitt’s book: The book I read was recommended to its readers by Stratfor Click: Stratfor. “The Garments of Court & Palace: Machiavelli and the world that he made,” by Philip Bobbitt. Click:The Garments. Click: Bobbitt. The fact of its being recommended by Stratfor should have given ample forewarning of its advocacy – nevertheless, I was, in the end, taken unawares.

Bobbitt’s commentary, as you will gather from the hyperlinked review, is well written, insightful and complementary. It places Machiavelli as the founder of today’s modern state system.

In Italy, at the end of the Fifteenth Century, the geo-political world was on the cusp of change.

Constantinople had just fallen to the Ottomans marking the final dissolution of the Roman Empire after 1,500 years of its existence. Most significant, was the way in which it fell. Sultan Ottoman Mehmet had access to new designs of cannon that pulverised Constantinople’s defensive walls and in doing so, revolutionised siege warfare. The multiple city-states and principalities into which Italy, at that time, was divided could no longer feel secure behind their fortifications.

Turkish bronze cannon circa. fall of Constantinople

In the event, it was the Spaniards and the French, with their new artillery, who were to present them with a more pressing danger than that posed by the Ottoman armies. Nevertheless, the Italians realised that times were changing and it was Machiavelli, ahead of his time, who wrote an advocacy of how the now out-dated feudal system could best be replaced with states better structured to defend themselves under the changing circumstances.

Feudalism: The feudal system was built on Kingship based on Christian morality, as interpreted by the Church of Rome, and on a hierarchy of loyalties sworn to individuals, starting with the nobility’s allegiance to the monarch and followed, down the chain, to the loyalty sworn by the lower orders to their respective liege lord. The problem was succession. The problem of succession ensured that a constitutional structure that ultimately depended on the competence of one mortal individual was, of its essence, unstable.

Fortune & Virtue: And here you come to the famous Machiavellian concepts of Fortune and Virtue. Fortune is the real world in which the state exists: the vagaries of Fortune surrounding the state are in a constant state of flux. On the other hand, the character and intelligence (the Virtue) of individual Princes during their single lifetimes, are far less subject to change. The fates of the subjects of a Prince are dependent not only on Fortune, but also on the Virtue of their Prince. If their Prince is successful, it is because his Virtue is such as to lead him towards actions that happen to coincide with the requirements of Fortune at that time. The behavioural traits, which have given the Prince success in the past, may not, and probably will not, remain appropriate as the wheel of Fortune turns. It is the general nature of individual Virtue that the Prince’s character will prove too rigid to change with Fortune’s altered circumstances and his state will thus fall into disarray.

The Wheel of Fortune

Muscat & Oman example: As a digression, I happen to be able to illustrate Machiavelli’s argument from my own experience. I once lived in a medieval, feudal state. Muscat & Oman, in the late 1960s, was described by one of my witty comrades as “rushing headlong into the thirteenth century.” The Sultan, Said bin Taimur al bu Saidi was a fine man of good character. His country, at that time, of less than a million inhabitants, was a British protectorate, which had miniscule state revenues to provide for the administration of the Sultanate. In his youth, Said bin Taimur had been coached by the then British India Office, and taught both prudence and above all else, frugality. The Empire clearly had no wish to have to draw on its own funds for the Sultanate’s upkeep!

The slim pickings of the rural and fishing economy offered no budget for health, roading or education. Defence was confined to local militias armed with ancient Martini-Henry rifles loaded with home-cast, lead candles. Despite the relative poverty, but amidst a modicum of well-being, orderly civic life continued under Sharia law in the relatively comfortable tranquility granted by Fortune’s momentary inertia and the rule of a Prince possessed of Virtue appropriate to his state’s circumstances.

And then Fortune’s wheel turned when BP discovered oil. Suddenly, the Sultan found himself with both external enemies and an internal income. In the 1950s, with support of the American Oil Company in Saudi Arabia, an insurrection was instigated to wrest the oil fields of the North away from the Sultan. This was suppressed with the help of the British, who had no intention of letting go BP’s proprietary rights – especially as the Sultan now had some income with which to pay for the services of the British military personnel subsequently seconded to his forces.

Shortly thereafter, the British abandoned their occupation of Aden on the Sultanate’s South West frontier. The People’s Republic of South Yemen (PRSY) which replaced British rule, had a ‘communist,’ revolutionary and anti-colonialist ideology and was soon training and arming dissatisfied subjects of the Sultan with a view to extending the PRSY’s revolutionary success.

Now that the Sultanate had a visible source of modern day revenue, subversion became more likely. Nasser’s secular Arab nationalism offered exciting new ideas to youth and Omanis of all generations opened to suggestions that they should receive the benefits of a modern day state: health care, education etc. Alas! The great Virtue of the Sultan that had assured his successful rule for so many years, was no longer appropriate.

Money now had to be spent on building a modern state and the Sultan was clearly not the man for the job. Had it been left to the old man, the Sultanate could well have collapsed and its potential wealth diverted elsewhere. As it was, the British, in close collaboration with his RMA Sandhurst trained son, arranged for a palace coup. The old man was sent into a comfortable exile in London and was replaced by his modern-minded son. Sayyid Qaboos bin Said saved the country from revolution and has subsequently and most successfully, brought his Sultanate into the modern world. He too, has shown himself to be a ruler with a Virtue-pack quite distinct from that of his father, but appropriate to the Sultanate’s current positioning on Fortune’s wheel. Click: Qaboos.

The Sultanate of Muscat & Oman

However, Muscat & Oman is not a constitutional republic and Sayyid Qaboos has no children to inherit his sultanate. He will make intelligent provision for a succession among his relatives and, despite Machiavelli’s fears, his state might well continue unperturbed by change to a ruler of different Virtue – at least for one more generation.

Looking around at the prevailing global chaos, anxiety and misery, one cannot say that modern day republics are that much more successful at coping with the recent turns of Fortune than were feudal states before Machiavelli’s new, independent sovereign state format took centre stage.

Machiavellian morality: Now for the controversial bit: Bobbitt sees the essence of Machiavelli’s innovation in political philosophy as being his proposal that loyalty should not be given to its ruler, but to the state itself. Though he saw princes of great Virtue, as men of their times and as being necessary for the founding of states, a state’s continuance would be better ensured by the move to a republican form of government – of which of course, in Rome, Italy had a notable previous example. Just as the success of a principality would depend on the Virtue of the Prince, so too, would the success of a republic depend on the Virtue of its citizens and of the citizens they appointed to lead them.

The aspect of Machiavelli arguments for giving loyalty to the state, which has most impacted on the public consciousness is his arguments based on Realpolitik, as opposed to Christian morality. Machiavelli argued for the necessity of those with responsibility for a state’s well-being, be they Princes, Senators, soldiers or Civil-servants to act with Virtue, as per his chosen definition of Virtue. In this case, a virtuous act was an act that would help the state and secure the safety, well-being and the ‘common good,’ of its citizens. If public Virtue clashed with the private morality of a citizen entrusted with duties of state, then the too scrupulous individual should resign from that position of responsibility. There was no mention of duties of responsibility to those living outside the state.

And thus we have defined as Virtue all acts, no matter how offensive to private morality, provided that the actor can convince himself, or herself, that it is done for the good of the state. This argument has persisted since the coming into existence and continuing evolution of the modern day states, which have replaced feudalism and which, until recent times, have been fully sovereign.

Raison d’état: In the past hundred years we have seen countless applications of Machiavelli’s ‘realism.’ Six hundred years after he presented his ideas to the world, modern day states are still functioning according to Machiavelli’s precepts. The doctrine of ‘raison d’état,’ is still alive and well Click: Reasons of State. We have seen Marxist morality: a lie is not a lie if it brings forward the revolution. We have had, and still have, all manners of colonial exploitation and associated wars, genocides, torture, drone strikes egregious breaches of international and civic law. All of these affronts to human empathy and values are conducted by patriotic office-holders of Virtue, doing their best for the state they serve and the ‘common good’ of its citizens (and, if need be, at the expense of the citizens of other states.)

Realpolitik as practiced then – and now

Times they are a ‘changing: Professor Bobbitt’s book confirmed the opinion I have held ever since the Bush & Blair invasion of Iraq. Put in Machiavellian terms, the current condition of international relations would indicate that the wheel of Fortune has turned yet again and Machiavelli’s precepts for the state are no longer appropriate to the age we live in. The modern state is faced with an accelerating multitude of threats. Climate change, environmental and food chain degradation, nuclear proliferation, fast expanding population, trans-national terrorism, a financial system that buries nations and peoples beneath impossible mountains of debt, armed might, supported by spin, rather than law, governing international relations, etc. I could go on! What these gathering crises have in common, is the seeming inability of today’s states to protect their citizens against their effects.

And then came the surprise. At the end of what I considered to be a book which was highly (possibly, too) appreciative of Machiavelli’s ideas and which I assumed, was expressing a smug satisfaction with the current status, which allows the patriots of Bobbitt’s American homeland to practice Machiavellian Virtue on a grand scale, Professor Bobbitt adds an appendix to the book.

Evidently he too, is of the opinion that we are on the cusp of huge change in the international order: that the wheel of Fortune is again on the turn and that Machiavelli’s sovereign state will be as relevant to the new age, as Feudalism was to it. If you look at the acknowledgements that follow his book’s appendix, you see listed the author’s many helpers. These seem to consist mainly of conspicuous practitioners of and sympathisers with the Machiavellian ideal of Virtue. The list includes former ambassadors such as Sir Jeremy Greenstock, who have devoted their lifetimes to lying for their countries, former heads of intelligence agencies, such as Gregory Treverton, and arch advocates of Realpolitik, such as Henry Kissinger.

These are the changes to the status quo that most impress Bobbitt, and by implication his ‘helpers.’ They “include a global system of communications that prevents any nation controlling its culture …: an international system of trade and finance that prevents any state from wholly managing its own economy..: a system of international human rights that pre-empts any state’s national laws…and that has served to legitimate an armed attack on a state that posed no threat to any other state…: transnational threats like AIDS and SARS or climate change and global, non-national terrorism …: the commodification of weapons of mass destruction…”

A brave new world: Bobbitt goes on to quote Douglas Hurd, one of Thatcher’s former ministers, “The world is run on a paradox. On the one hand, the essential focus of loyalty remains the nation state and there are nearly two hundred of these. On the other hand, no nation state, not even the single superpower, the United States of America,, is capable of delivering to its citizens single-handed the security, the prosperity, and the decent environment which the citizens demand.” Bobbitt does not see this situation as meaning an end of the nation state, but rather the spur to a re-negotiation of the deal it offers its citizens. So here it is, the brave new world we are about to enter. According to Bobbitt it is called ‘the Postmodern State,’ or ‘the Market State.’


The Market State: Bobbitt quotes two definitions of the market state to give us a heads up: “ .. the emerging constitutional order that promises to maximise the opportunity of its people, tending to privatize many state activities and making representative government more responsible to consumers. It is contrasted with the current nation state, the dominant constitutional order of the twentieth century that based its legitimacy on a promise to improve the material welfare of its people.” His other definition comes from a Royal Dutch Shell forecast scenario “The gradual transition from the nation state to the Market state model implies a redefinition of the state’s fundamental promises: from maximisation of the Nation’s welfare towards maximisation of opportunities for… civil society and citizens. States in the advanced market democracies do not define their own success in terms of being able to resist market forces, as in Europe not long ago, but in terms of fostering market expansion to provide a wide range of public…goods.”

Bobbitt goes on “Like the nation state, the market state assesses its economic success or failure by its society’s ability to secure more and better goods and services, but in contrast to the nation state it does not see the state as more than a minimal provider or redistributor.” In short, Bobbitt sees the market state as being dependent on international capital markets, the modern multinational business network and the global stability created by the workings of these institutions operating “in conjunction with national or transnational political bodies.” He goes on “…by contrast, the market state manages its operations by using the market and market mechanisms. Whereas the nation state justified itself as an instrument to maintain the welfare of its people, the market state exists to maximise the opportunities enjoyed by all members of society – regardless of their national origin – and accepts that some will make better use of these opportunities than others, inevitably leading to widening inequalities. For the nation state, a national currency is a medium of exchange; for the market state it is only one more commodity. Much the same may be said of jobs; for the nation state, full employment is an important and often paramount goal, whereas for the market state, the actual number of people employed is but one more variable in the production of economic opportunity and has no overriding intrinsic significance….the market state is classless and indifferent to race, ethnicity, sex and sexual orientation, its yardstick for evaluation is the quantifiable. …. If the nation state was characterised by the rule of law, the market state is largely indifferent to the norms of justice, or for that matter to any particular set of moral values so long as law does not act as an impediment to economic competition. Because market states are also indifferent to the values of loyalty, reverence for sacrifice, political competence, privacy and the family, …either these values must be supported without government backing, or we will replace them with the values of the market, which seem largely to exalt entertainment and the accumulation of wealth.”

Already happening: There is no doubt that, as Bobbitt observes, this process of change is already well under way. Privatisation of public assets, contracting out of government services, professional and mercenary, rather than conscript armies, internationalisation of trade and capital flows, enfeebled safety nets for less competitive citizens, indifference to considerations of international justice and allowing increasing dominance of international corporations over the social considerations of nation states, are all tendencies gathering pace.

To judge by its polices, New Zealand’s current National Party government, led, as it is, by John Key, a former Merrill Lynch top executive, would seem to have a particularly clear vision of the market state as representing the most desired way forward for its society. One has to question if that is what the electorate is seeking? Without a clear vision of the path ahead, such as one assumes is in front of at least some of the members of its political leadership, the New Zealand public is unable to see the intended destination. With the view blocked by the backside of the sheep in front, the electorate has, in recent elections, been quite content to play follow-my-leader, like sheep to the shearing shed.

Bobbitt’s vision of the market state, whether he is actually advocating it or not, is one in which the lone individual, driven by the endlessly promoted dream of ‘wealth’ as being the sole meaning of life, isolated from friends and family, geographically and culturally displaced, stands alone. In front of him is the wealth machine on which his hoped for future depends; the towering, psychopathic, multinational corporation that temporally employs him or her, and is indifferent to considerations of  human happiness, or of anything much beyond this year’s dividend for its distant shareholders and the bonus pay-outs due to its gilded elite.

corporate prey

Any alternatives? While the state he advocated atrophies, Machiavelli’s morality marches on – but now, with new corporate practitioners. Could there be alternative ways in which humans could relate to each other and to the Earth that supports them? Could there be a more humane way of organising the global polity, better suited to providing for human happiness? Only a grass-roots movement will have the strength to divert the political elites from their current course.

For this to happen, the grass must remain attached to its roots. Community, be it based on geographical,  or cyber proximity, is the sole hope of a human future. Rootlessness, displacement of populations, the isolated individual set afloat as flotsam on the corporate ocean, are all trends entirely advantageous to the corporate predators, whose natural habitat is the market state.

Resistance entails people caring for one another and going out of their way to incorporate into their communities all those uprooted by the new society. Above all, individuals should resist isolation, consciously connecting and communicating with others: keeping in touch with their origins, their families, their friends, their neighbours and their colleagues. The caring society is the natural enemy of the market state.


Something to add? Please leave a comment in the box below

2 thoughts on “Corporate Heaven: Machiavelli and the Market State – Blog No. 48.

  1. Budyong Hill says:

    Thanks Hugh. Another excellent effort by you. You have such a good way of getting to the core of things. I am sitting here in a backpackers resort on Taveuni Island after having spent a couple of hours snorkelling on Rainbow reef in Somosomo Strait. Amazing, Beautiful, Wonderful Nature! But the signs of dead coral and coral bleaching were there to seen amongst the wonder. This article indicates that coral may be more resilient than generally thought so I’ll keep my fingers crossed.

  2. Tom Malone says:

    I studied the Prince in philosophy at uni. When Machiavelli uses the term ‘virtue’, he implies ‘virtuosity’, which is more a process by which something is done, than a value judgement. I don’t think that there was anything wrong with what Machiavelli said, he was merely saying that ‘being good’ is not plausible if you’re trying to run a state, as there are so many implications to everything you do. And often you have to do bad things for the interest of the state. I think he merely recognised modern states and disconnected its leaders from divinity (as would Hobbes do 138 years later in his Leviathan). I think it is still relevant even in a Market State, as it would be in the running of any institution. As for the doom and gloom of such future global Market States, I think that people now tend to have more in common with like-minded people in other countries than their fellow citizens, so this might be a good way to move forward.

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