Introduction. What is capitalism?

What does capitalism mean to you? Here are some words that people often mention:

* profit

* banks

* exploitation

* markets

* greed

* poverty and inequality

* wage labour

* class system

* supply and demand

* consumerism

* commodification

All of these point out common features of the world we live in today. In this book we will look at all of them, and more.

Some classic definitions

But can we sum it all up in one handy definition? Here are a few classic quotes by famous white men.

According to Karl Marx, the ‘capitalist system’ is a system of economic production which involves two basic classes of people:

“on the one hand, the owners of money, means of production, means of subsistence, who are eager to increase the sum of value they possess, by buying other people’s labour power; on the other hand, free labourers, the sellers of their own labour-power [and who own nothing else except their own labour power]” (Capital Volume 1 Chapter 28)

According to Max Weber:

“capitalism is identical with the pursuit of profit, and forever renewed profit, by means of continuous, rational, capitalistic enterprise” (The Protestant Ethic and the Spirit of Capitalism, Introduction xxxi)

Here is a more recent one from Keith Hart, a contemporary economic anthropologist:

“that form of market economy in which the owners of large amounts of money [or, more generally, wealth] get to direct the most significant sectors of production. They do so in the interest of adding to the amounts of wealth they have.” (The memory bank: money in an unequal world, p83).

All three definitions make important points. Hart’s definition helps point out that capitalism is a system of power, in which power to ‘direct’ the world comes from owning wealth and property. Weber’s definition focuses on how our world has become dominated by the ruthless pursuit of profit.

Both Hart’s and Weber’s definitions are focused on the activities of a crucial group: ‘capitalists’. Also known as ‘entrepreneurs’, ‘businessmen’, or owners (or managers) of the ‘means of production’, etc. Certainly, there is no capitalism without capitalists. But Marx’s definition adds a crucial point: capitalists are in the minority; capitalism systems involve a number of different groups, or ‘classes’, often in struggle with each other.

However, Marx’s definition has serious problems too. He thinks of just two basic groups, capitalists and ‘free’ paid workers. What about the ‘unfree’ labour of slaves, indentured workers, prisoners, all of which also massively increased with capitalism? Or the billions of women and children doing unwaged ‘domestic’ work? Through its history, capitalism has involved many different kinds of workers, slaves, peasants, consumers, unemployed, rebels, and other dispossessed people. Can we group all these together as one ‘class’? Or is it only waged workers, the classic Marxist ‘proletariat’, who really matter?

Another limit of all these definitions is that they focus on capitalism as an ‘economic system’. But capitalism is more than that. Capitalism isn’t just ‘the economy’, it shapes every aspect of our lives, all our ways of living and relating to each other, from love to war, even with our closest friends and loved ones, and digs right into our deepest dreams and desires.

Many capitalisms.

Actually, maybe there is no one ‘correct’ definition of capitalism. And it’s probably more accurate to think about capitalism in the plural. Over the last few hundred years there have been many capitalisms, or forms of capitalism. And, sadly, there will probably be more capitalisms to come.

Historians argue about whether capitalism began in Italy in the 15th century, or the Netherlands in the 16th century, or perhaps Britain in the 17th century. All of these early capitalisms were different from capitalism today. And capitalism today is different in London or Nairobi or Shanghai, or in the South American rainforests or the Asian highlands.

In whatever form, capitalism is not ‘natural’ or eternal. It is constantly changing, being re-made by human beings, and by the bigger worlds around them. The history of capitalism is a history of invention and creativity, and of destruction, exploitation, domination, bloodshed and terror, and also of resistance and struggles for freedom.

Capitalism is not an all-powerful ‘monolith’. Capitalist systems co-exist, incorporate, work with or fight against other systems, cultures and forms of life. For example with older feudal or tribal institutions, or with movements to create different ways of living.

With all these provisos, we can use the word ‘capitalism’ as a shorthand for some key features of how our world is run today. The aim of this book is to try and understand these basic features. Understanding them will help us think about how to destroy them, and so help free ourselves to live differently.

Cultures and economic systems.

To simplify things, we will look at two aspects of capitalism. In the first few chapters, we start rather narrow with capitalism as an economic system. This is the traditional province of ‘economics’. We look at how capitalism works as a system for organising the use, production and distribution of economic goods or ‘commodities’.

Here are some key features of capitalist economic systems:

** markets play a central role in making decisions

** property rights set out who can use and trade goods, and so have economic power

** things, animals, and people are made into commodities that can be owned and traded

** the state acts as an enforcer of the economic system, and helps it spread

** concentrations of wealth, of capital, channel power into the hands of capitalist elites

** the profit motive drives capitalists to continually expand markets

** in modern industrial capitalism, profit very largely involves the exploitation of people who are forced to work

But to understand capitalism we also need to look at how these economic structures are dug in deep, in ways that effect every aspect of our lives. For example, capitalism as an economic system can’t function unless many people learn, often from childhood:

** the rules of markets, how to act as buyers and sellers

** to respect property

** to see animals, the natural world, other people, and even ourselves, as ‘objects’ to be bought and sold, owned and managed

** to respect and fear the state, its laws, police, judges and teachers

** to accept gross inequalities of power and wealth

** to believe that accumulating ‘stuff’ is the key to happiness

** to base our lives around work

To highlight this point, we can say that capitalism is not just an economic system but also, and more deeply, a form of life, a culture. That is: a complex of desires, values, norms, conscious and unconscious rules, practices, behaviours, attitudes, that are shared and spread in the social groups in which we are born, raised, and live our lives. We will come back to these crucial points in the last few chapters.