Capitalism is a mode of power (primarily economic), based on appropriation of people’s goods and labour, a particular distribution of wealth and labour and the valuation of that wealth and labour.
There are a number of forms of what is called capitalism. In my lifetime, where I live, we have had socialist-capitalism and we now have neoliberal capitalism, with more or less complete domination by the corporate sector. Scandinavian capitalism differs from French capitalism, which differs from Anglo-capitalism, which differs from Chinese capitalism and so on.
Capitalism is not trade. Trade exists in all societies, including ones that most people would not call capitalist. (China is weird, if people want to praise it they point out it is now capitalist, and if they want to condemn it they point out it is now communist. In either case there is trade.)
The origins of any of these forms of capitalism depend upon a heap of contingent factors, particularly including politics, and clearly cannot be summarized in a readable post – so this is only a summary for Anglo-capitalism.
Historically, one argument is that this capitalism grew out of the inequalities, violence and wealth accumulations of feudalism. It was boosted in the UK by dispossession of people from their land, which provided a class dependent on wage labor for survival, and who could be hired and dismissed with little cost or sense of social obligation. Wealth accumulation was also boosted by the slave plantations in the Americas, which pretty obviously depended on dispossession and non consensual labour. It was also boosted by private citizens engaging in piracy on the Spanish treasure ships on behalf of the crown. The British Tudor (and later) Monarchy promoted non-aristocratic citizens to positions of power and wealth, which weakened the aristocracy. This movement was accompanied by the rise of a powerful mercantile class and, between them, they began to change the form of British politics and economic structures into one far less dependent upon royal patronage or the ties of feudal obligation.
Then the development of the steam engine, together with an abundance of coal, plus further political action and repression, allowed the relatively secure work and trade of crafts people to be destroyed, so more people became dependent upon capitalist industrialists for survival and more profit was channeled towards those who owned and controlled the technologies of production. The search for markets and resources to support this production led to Empires, as for example when the East India company took over India and destroyed local crafts and to help with their exports of cheap machine made materials (made with Indian cotton). There is a little dispute, but basically the now-standard argument is that the company and its accompanying British Rule completely destroyed the Indian non-capitalist economy and largely helped generate the mass poverty and inequality that the 20th Century Indian State has had to deal with.
Capitalism has also taken advantage of fossilised energy. It is the development of energy, from slavery, wage labour to coal that produced whatever abundance was shared by the more fortunate members of capitalist society. The steam engine depended upon coal, but around about the start of the 20th Century, oil and petroleum upped the portability and effectiveness of energy once again and with it the apparent abundance.
However, this abundance depends on power relations and law which allows pollution and poisoning costs to be ignored by the producer, or diffused onto those of ‘lesser importance’. It is always the way that the poor have pollution poured on top of them. This could be realistically known as ‘trickle down economics’. The current problem for capitalism is that the pollution it, and its variants, are engendering is likely to destroy the ecological systems it has depended upon but has refused to acknowledge. Today we see that battle being conducted in the form of a struggle over climate change and appropriate action.
While the economy is not natural, but political, and embedded in power relations, it does need to be acknowledged that conquest and appropriation, in itself, does not lead to capitalism. The way plunder was organized in the Spanish Empire, for example, seems to have destroyed their economy. It was not invested in manufactures and trade – the ‘bloated’ aristocracy won out over the mercantile class and the peasants.
Everywhere that capitalism has gone, it has tried to destroy non-capitalist economies, through dispossession of property, the imposition of wage or indentured labour, and taxes which required people to pay cash which they had to earn through wage labour. There are endless colonial and business reports complaining about the laziness and irrationality of ‘natives’, who had better things to do with their lives than hold down jobs, and who did not need jobs to survive(until that independence was destroyed).
Capitalists always argue that capitalists are wealth creators and deserve special privilege and powers. Because large capitalists end up owning most of that wealth they are usually able to buy politicians and propaganda, and control society to act to give them those special privileges and powers. Hence capitalist power tends to reinforce itself, and make all life even more dependent on capitalist action, and capitalism becomes seen as “common sense”.
We had a relatively generally prosperous period when capitalists feared revolution, but since that period has passed, wealth and power now accumulate primarily at the high ends.
Climate, technology and chaos Blog 