What Capitalism is Not (specifically, it is not markets)
There’s a particular confusion that crops up alot, that confuses the existence of markets, with the existence of capitalism. But the two are not the same, not by a long shot. So this is a thread to try and clear up some things on this front.
Markets: Impersonal Exchange
First, what is a market? A market is, first and foremost, a site of what might be called [I]impersonal exchange[/I]. It is ‘impersonal’ insofar that those who participate do not, for the most part, have any pre-existing obligations, bonds, or relations to one another. This ‘impersonal’ aspect of markets is what makes it different to say, gift economies, where gifts might be exchanged in order to keep up good relations between tribes. Or else different to relations of patronage or villeange, in which labour or goods are exchanged for protection or use of land.
One might say that what defines the ideal market is the ‘spot exchange’. The exchange ‘on the spot’, of goods, money, or labour, after which the participants no longer have any social relation to one another at all. They are free to go their separate ways. In reality, markets do not really work like this - there are always all kinds of extra-market relations of debt and obligation between market actors - but that can be put to the side for now.
Capitalism: Impersonal Production
Nonetheless, if a market is defined by impersonal exchanges, what defines capitalism? Well, a few things. First, capitalism implies a [I]generalization[/I] of impersonal exchange to all spheres of the economy. That is, impersonal exchange must begin to [I]replace[/I] all kinds of regimes of personalised and social exchange. So in medieval Europe, for instance, although markets existed everywhere, they were in many cases peripheral or in the interstices of society. Traders and merchants existed, but as far as medieval economies went, they only made up a fraction of the economic activity that took place. Merchants were in fact very often looked upon with disdain by many in medieval society. In any case, the generalization of impersonal exchange involves an increase in [I]commodification[/I]: making things commodities for the market.
Yet the generalization of impersonal exchange still doesn’t yield us capitalism. All we have so far is limited instances of [I]capital[/I]. For capitalism proper to get off the ground, what you need is the [I]reproduction[/I] of impersonal exchange. Impersonal exchange not only needs to be generalised in space, it needs to be extended in time. And for this you need institutions. History shows us that more than any other, it was the existence of [I]states[/I] that were crucial in the reproduction of impersonal exchange. Not only did states provide say, fiat money that could be used across wide swathes of territory (and other kinds of standarization: weights, measurements, addresses, etc), they also provided security for traders, without which trading would be impossible. Their most important role being their ability enforce contracts and defusing issues of trust. In any case it is the reproduction of the conditions of impersonal exchange that begins to make instances of ‘capital’ into capital-ism: a systematization of ‘capital’ in society.
Yet even here, neither the generalization nor the reproduction of the conditions impersonal production is enough to get us to capitalism. One further, crucial step needs to be taken. And this involves looking not at ‘exchange’ - how goods or money circulate - but [I]production[/I]. In the absence of impersonal exchange, the production of [I]stuff[/I] often does not take place [I]for[/I] the market. Rather, one produces so that one can pay the lord’s taxes; or else one produces so that one can feed one’s family. And so on. However, once impersonal exchange becomes wide-spread enough, it brings with it a change in the ‘who’ or ‘what’ production is geared towards: no longer lords and family, but markets.
It is at [I]this[/I] point, where the general [I]mode of production[/I] becomes geared towards the market, that capitalism proper can be said to come into being. And this, ultimately is the difference in kind between markets and capitalism. Markets bear upon issues of [I]exchange[/I]: how goods move from one set of hands to another. Capitalism on the other hand, cannot be understood apart from issues of [I]production[/I]: of who and what is it that stuff is produced [I]for[/I]. It is precisely because capitalism has to do with production (and not just exchange), that capitalism cannot be understood apart from changes in [I]labour[/I], in how labourers go about producing things, along with the conditions under which they labour.
Markets: Impersonal Exchange
First, what is a market? A market is, first and foremost, a site of what might be called [I]impersonal exchange[/I]. It is ‘impersonal’ insofar that those who participate do not, for the most part, have any pre-existing obligations, bonds, or relations to one another. This ‘impersonal’ aspect of markets is what makes it different to say, gift economies, where gifts might be exchanged in order to keep up good relations between tribes. Or else different to relations of patronage or villeange, in which labour or goods are exchanged for protection or use of land.
One might say that what defines the ideal market is the ‘spot exchange’. The exchange ‘on the spot’, of goods, money, or labour, after which the participants no longer have any social relation to one another at all. They are free to go their separate ways. In reality, markets do not really work like this - there are always all kinds of extra-market relations of debt and obligation between market actors - but that can be put to the side for now.
Capitalism: Impersonal Production
Nonetheless, if a market is defined by impersonal exchanges, what defines capitalism? Well, a few things. First, capitalism implies a [I]generalization[/I] of impersonal exchange to all spheres of the economy. That is, impersonal exchange must begin to [I]replace[/I] all kinds of regimes of personalised and social exchange. So in medieval Europe, for instance, although markets existed everywhere, they were in many cases peripheral or in the interstices of society. Traders and merchants existed, but as far as medieval economies went, they only made up a fraction of the economic activity that took place. Merchants were in fact very often looked upon with disdain by many in medieval society. In any case, the generalization of impersonal exchange involves an increase in [I]commodification[/I]: making things commodities for the market.
Yet the generalization of impersonal exchange still doesn’t yield us capitalism. All we have so far is limited instances of [I]capital[/I]. For capitalism proper to get off the ground, what you need is the [I]reproduction[/I] of impersonal exchange. Impersonal exchange not only needs to be generalised in space, it needs to be extended in time. And for this you need institutions. History shows us that more than any other, it was the existence of [I]states[/I] that were crucial in the reproduction of impersonal exchange. Not only did states provide say, fiat money that could be used across wide swathes of territory (and other kinds of standarization: weights, measurements, addresses, etc), they also provided security for traders, without which trading would be impossible. Their most important role being their ability enforce contracts and defusing issues of trust. In any case it is the reproduction of the conditions of impersonal exchange that begins to make instances of ‘capital’ into capital-ism: a systematization of ‘capital’ in society.
Yet even here, neither the generalization nor the reproduction of the conditions impersonal production is enough to get us to capitalism. One further, crucial step needs to be taken. And this involves looking not at ‘exchange’ - how goods or money circulate - but [I]production[/I]. In the absence of impersonal exchange, the production of [I]stuff[/I] often does not take place [I]for[/I] the market. Rather, one produces so that one can pay the lord’s taxes; or else one produces so that one can feed one’s family. And so on. However, once impersonal exchange becomes wide-spread enough, it brings with it a change in the ‘who’ or ‘what’ production is geared towards: no longer lords and family, but markets.
It is at [I]this[/I] point, where the general [I]mode of production[/I] becomes geared towards the market, that capitalism proper can be said to come into being. And this, ultimately is the difference in kind between markets and capitalism. Markets bear upon issues of [I]exchange[/I]: how goods move from one set of hands to another. Capitalism on the other hand, cannot be understood apart from issues of [I]production[/I]: of who and what is it that stuff is produced [I]for[/I]. It is precisely because capitalism has to do with production (and not just exchange), that capitalism cannot be understood apart from changes in [I]labour[/I], in how labourers go about producing things, along with the conditions under which they labour.
Comments (184)
If the above defines capitalism, what is this thing called ‘neoliberalism’ that people often talk about? It means many things, but for this note, it can be said to represent one further step in the generalization of impersonal exchange. Neoliberalism is what happens when not just economics becomes a matter of impersonal exchange, but politics and governance too. That is, when governments themselves become subject to market imperatives: hence mass privatisation of previously ‘public goods’, along with the treating governments as market institutions themselves: not governing for the sake of people and populations, but for the sake of markets, which substitute [I]in place of[/I] political governance.
Finally what does financialization have to do with this? We often hear about the rise of financialization, and the predominance of ‘speculation’ and debt, but what does this have to do with the above? Well, one answer is that the above model of capitalism based on markets is, in a word, failing. Markets - the exchange of goods - simply no longer deliver the kinds of profits that is generally sustainable and re-producible (and reproducibility is one of the things that defines capitalism!) As such, cooporations no longer look (just) to selling stuff to make their profits, but to making money from money itself: not [I]commodities[/I] but [I]assets[/I] (housing, stocks, debt) are now the key to making profits. Although they are sustained by markets, they are parasitic off of them, even as they engender larger and larger crisis at the level of markets themselves - and vice versa. In a word, the rise of financialization is an index of capitalism in crisis.
In other words, there's diabolical nexus between so-called democracy and capitalism.
A followup question might be: how much does neoliberalism allow capitalism to abandon states, that is, nation states?
Acute observation and an excellent analysis. I suppose trade what are called ‘financial derivatives’ exemplifies and underpins this kind of abstractification, if that’s a word.
I think the state remains as important as ever. What does happen though, is that the state fundamentally changes in its function and orientation. Where once it functioned - at least in the West - as a social bulwark to market generalization (via social security, investment in infrastructure, efforts at redistribution, etc), it now functions more and more as a simple police apparatus. That is, instead of taking care of your population, it's much simpler to punish and incarcerate them. As it so happens, the latter affords more opportunities to profit, even though it may, in the long run, be more expensive for all involved. Related to this, the rights of property above all else are the focus of state action: the state exists to protect - and expand - property rights. All other rights - like say, rights to be in control of one's own womb - are negotiable. Workers rights above all, are subject to destruction by states, instead of protecting them. It is a concerted and sustained political effort.
On the foreign policy front, the is state still vitally important to maintain overseas markets, along with expanding the reach of 'open markets'. This usually means negotiating so that companies have access to production in poorer - although somewhat stable - countries like China, Indonesia, or Vietnam. It takes enormous state organization to ensure that all this happens smoothly so products can be manufactured there and then shipped in to the core nations. And then of course these war to subdue threats to market generalization - which is a partial explanation of what is happening in Ukraine right now.
And the other thing states do, more and more - I think maybe among the most consequential and least talked about - is to take on private risk. That is, private business risk is 'offshored' to state, who bear the burden when capitalist markets fuck up. The political economist Daniela Gabor has a really, really excellent and easy to read paper [PDF] on this topic. From the abstract: "The state risk-proofs development assets for institutional investors by taking on its balance sheet: (i) demand risks attached to commodified (social) infrastructure assets, (ii) political risk attached to policies that would threaten profits, such as nationalization, higher minimum wages and climate regulation, (iii) climate risks that may become part of regulatory frameworks; (iv) bond and currency markets risks that complicate investors’ exit". This 'taking on investment risk' tracks with the increase of financialization: states can function as lenders of last resort and prop up 'too-big-to-fail' institutions without which everything goes tits-up.
One thing to note is that while states are important, this has very little to do with state sovereignty. States do all this, but not because they are sovereign, but because they are largely held hostage by market forces: states are largely the bureaucratic systems of market actors in all of this. This is most clear in places like the EU, where states more or less simply do not have control of their own fiscal or monetary policies. Which again means, in lieu of actual governance, they are reduced to a simple security apparatus. International "trade agreements" like GATT and NAFTA do the same on a global scale. So there's a kind of separation of 'the nation' from 'the nation-state'. Insofar as nations have anything to do with it, it's as a scape-goat: nationalism blossoms to compensate for the abandonment of the state for the people. Instead of blaming capitalism, migrants, minorities, sexual deviants, and colored people are blamed for decaying societies. The separation of nation and state makes the nation something deadly.
Also I haven't said anything about currency but oh boy states and currency and the necessity of states to try and keep currency under control for the sake of markets has basically driven the last 80 years of global history.
One of the ancestors of free markets was an aspect of the Bronze Age palace economy. People brought their wheat and other goods to the palace. Priests would then take a cut for the palace and distribute the rest to the people.
The late Bronze Age was similar to our world in that there were a handful of powerful states which controlled the known world. Free markets appeared around the time this international complex began to disintegrate. They may have been a response to collapse.
So free markets don't necessarily require states. However a free market can be a brutal and dangerous environment. Prior to the advent of money, every possible way to cheat and rob were explored in free markets.
Money, as far as we know was invented one time in Lydia. It eventually revolutionized human life by becoming the prime abstraction. It facilitated trade by eliminating one of the ways people cheated. Everywhere money went, societies lurched out of stagnation into progress. Strictly speaking, you don't need a state to mark gold ingots that all weigh exactly the same, but state backing increases confidence.
Now that abstraction is seeping into every aspect of human life with the prime abstraction: value, the next leap in human capacity comes from banks which provide the technology of virtual value. Since the Italians perfected the art, we've been living beyond our means. We basically discovered how to walk into our dreams.
This is one of the things I wish I could get across to some leftists. Money and banking, which are both products of a laissez-faire environment, aren't just objects in our world that we can extricate ourselves from by wearing red bandanas. Those things are literally part of who and what we are. They're part of the way we think and see the world.
Quoting Streetlight
Failing how, though? I've been pondering this for a while, and I still don't quite understand other than it has to do with the 1970s.
The outcome was the emergence of a new elite, new opportunities, new horizons, new dangers.
First, I don't know why you keep referring to 'free' markets, rather than markets. Not sure what this qualifier is doing. Second, this is far from an impersonal spot exchange, and fits quite nicely as one of the modes of social exchange that defines pre-market society. Not sure what point you're trying to make here. "Free markets" is something Americans like to say because they don't really understand the term, and has to do primarily with international trade and the absence of protectionist policy. But that's not what we're talking about, really.
Quoting frank
I'm not sure why you think 'money and banking' is a target here. Money absolutely facilitated markets, allowing for impersonal exchange to be even more impersonal. But part of the reason I've emphasized that capitalism takes root at level of production rather than exchange, is to make clear that money and banking is, at best, a peripheral problem, and certainly not a central one. In fact there's nothing wrong with money or banking per se - only what we do with them. Far more interesting - and worth abolishing - is the private property form, which is a enormous limiter to human potential.
Quoting frank
Here you go:
https://thenextrecession.wordpress.com/2022/01/22/a-world-rate-of-profit-important-new-evidence/
https://thenextrecession.wordpress.com/2020/07/25/a-world-rate-of-profit-a-new-approach/
A free market has no price controls. The oldest version of controlled markets is where priests set prices (in quantities of cacao nuts in South America). There were harsh penalties for trading without permission.
In a free market prices are set by the operation of the market itself.
Quoting Streetlight
What we think of as capitalism developed hand in glove with money and banking. Separating them would be a leap in the dark.
Quoting Streetlight
So the Bronze Age economy was not capitalist. It was clearly socialist. It's interesting to contemplate why it failed after centuries of robust contribution to culture.
More importantly: why, having failed, it never came back.
You're welcome to read the OP for why this is an irrelevancy.
Quoting frank
This is an anarchonism so terrible it does not deserve attention.
Still not sure why you want to talk about priests or what that has to do with anything.
Really? Why doesn't the palace economy count as socialism?
Quoting frank
Thanks for playing.
Quoting Streetlight
Quoting Streetlight
What should be added to this account of the birth of capitalism is the reciprocal interrelation between the impersonal production and reproduction and the emergence and development of the personal sphere itself. In parallel to the continuous process of decoding, destroying, and reconstructing archaic social, institutional, economic, and individual norms and relations, there has been the ongoing activity of creating and animating private life and personal interests.
The omnipresent deterritorization has been compensated, balanced, and concealed by the all-embracing re-territorization.
Examples?
Quoting Streetlight
[quote=Christopher Lasch, The Revolt of the Elites and the Betrayal of Democracy]. ..the market in which the new elites operate is now international in scope. Their fortunes are tied to enterprises that operate across national boundaries...Their loyalties - if the term is not anachronistic in this context - are international rather than regional, national, or local...Many of them have ceased to think of themselves as Americans in any important sense...their ties to an international culture of work and leisure...make many of them deeply indifferent to the prospect of American national decline.[/quote]
A necessary thread indeed.
My only comment is that I’m surprised you didn’t include the existence of owners/employers as a distinguishing feature of this socioeconomic system.
We can imagine a world where production was controlled by workers and yet geared towards markets. Would this still be considered capitalist?
Heh, it would have needed at least another paragraph, and things were getting a bit long. I could only gesture at it in the last line regarding changes to labour that follow from changes to production. But yes, the owner-employer relation is the next step - it follows from (or with) production being geared towards markets. Because once the latter begins to happen, market actors themselves begin to take direct control of the production process. Before the emergence of capitalism full-blown, labour tended to have, in a broad sense, control over their own means of production: land in particular, would be theirs to do with as necessary (even if this 'necessary' included having to harvest for a lord).
But once capitalism emerges, workers comes to be dispossessed from such means: they become 'free workers' - freed from their lands such that their only means of production are their bodies alone. Land - and capital - starts to belong directly to merchants, or, at this point, capitalists. And they do this in order to squeeze out 'efficiencies' from production, and root out any resistance to the market-orientation of production. Hence, for instance, the importance of 'enclosure' movement in England, among other historical turning points. It is at this point that the owner-employee (capitalist-worker) relation takes definitive shape. But in the order of things, free labour follows from the institution of capitalism, rather than precedes it.
Quoting Xtrix
I think so, yes. Certainly a far more conciliatory capitalism than we know, but to the degree our conditions of life are dictated by markets - and not the other way around - this would still be a case of capitalism ascendant. I'm not 'against markets' per se - they undoubtedly help solve coordination problems, under certain conditions - but they need to be a tool among others in our arsenal of life. We must put them to use for us, rather than putting us to use for them.
Yes. And this makes sense - insofar as markets are a matter of impersonal exchange, their generalization effects a 'disembedding' of exchange from social contexts. Nothing matters (in principle) outside the spot exchange, which means the only agents that begin to matter are individual market-actors, and not say, communities, groups, territorial bands, or even hierarchical relations. Social relations are (in principle) irrelevant.
The birth of 'the individual' follows quite nicely from the birth of generalized market-society. It is no surprise that liberalism - whose unit of analysis is precisely the individual, upon whom rights and obligation accrue (and property rights above all!) - is born exactly at the end of feudalism at the point at which markets become ascendant. The 'bourgeois revolutions', French, English, American and so on, all took place against the weight of feudal hierarchies and their appropriation of productive processes, all the better to champion the individual as the prime actor in history and society. And it is liberalism above all which championed - if not outright invented - the very distinction between the 'personal' and the 'public' - @Tom Storm.
:up:
Quoting Streetlight
That makes sense.
It’s a matter of definition, but here my own answer would be “no.” I think if workers controlled production— if we essentially democratize the workplace — then it’s no longer a capitalist system, despite the fact that markets, production-for-markets, and profit-making continues. It implies that people will decide what to produce, where to produce, how to do so, and what we do with the profits/surplus — so I see this changing the markets/conditions of life you mention as a natural consequence. But this is speculation on my part.
The co-op model is a real world example. All that’s really changed is throwing out the small group of owners — which is what so much of this system creates and is designed to perpetuate.
Ultimately the goal is going to have to be freeing ourselves from market-dependency. That's the left project of freedom. Actual freedom, and not the fuck-you-I-got-mine bullshit peddled by the right. And part of that is going to be abolishing, or at least severely curtailing, the private property form. That said, I do see democratic workplace ownership as an enabling condition of that state of affairs. People should decide how, where, what, and how much to produce, but instituting workplace democracy won't get us all the way there without putting into question market-dependency, without which even collective decisions will be severely constrained in their decision making wiggle-room.
Importantly, being free of market-dependency doesn't mean getting rid of markets tout court. I'm not sure that would be either possible nor desirable. But it would mean incorporating markets into wider circuits of social life in a way that does not make the latter depend on the former.
Gotcha. Posting on the fly.
I was wondering if you or anyone else would give examples of incorporating markets into wider circuits of social life.
This is utter nonsense.
Edit: I wanted to participate, but I'm at a loss for words due to my not understanding most of it.
@Benkei mentioned something about the perpetuity of corporations -- that they are a separate entity, existing with rights of a person, which should be discussed here. I related to that, but the response had again put me in confusion. So, there's got to be a gap in my understanding of this discussion. Which embarrasses me. :zip:
Edit 2: I think it exposes my lack of understanding of capitalism. This is the only sane explanation I can come up with.
For me these two points are important and often overlooked.
Quoting Streetlight
Quoting Streetlight
Many of us forget that our values and sense of self are a product of this ideology.
What Streetlight said there isn't really true, though.
Quoting Streetlight
His focus seems to be on industrialized societies, forgetting that markets can be deal with things like bundles of mortgages, which are not produced by anyone per se, and certainly don't involve labor.
Quoting Streetlight
The 'birth of the individual' is usually identified as the Renaissance. It's true that it's an idea in conflict with feudal life. So he's sort of right about this. A guy can't be wrong all the time.
We're just discussing the way "capitalism" is used, not whether it's good or bad.
Streetlight's views seem outdated to me, like he's in the 19th Century or something.
Well, you know what they say, truth doesn't have a 'use by' date. I'm sure Street will clarify anything you throw at him. I can't comment at any depth (debating this stuff begins to resemble arguments about the meaning of Bible verses) as I don't study politics or history closely. But so far nothing I have read here strikes me as egregious.
I doubt it.
One potential consequence is that our political governance changes along with corporate governance. Externalities and foreign trade would still exist, but would be much less of a problem — because the state would be acting under different pressures from a different set of interests. It wouldn’t be “profit over everything”, there would be less short term thinking, more investment in communities and general welfare.
Of course I have no certainty of this— it’s speculation really. I wouldn’t pretend to know how it all pans out. There’s bound to be flaws in any system. But unless we move in this general direction, I don’t see how we survive much longer as a species. That alone is reason enough to push for it.
I hope you push back a little on this and elaborate, because there may very well be scenarios I’m overlooking.
When you think of capitalism, think of activities that people engage in specifically to make a profit.
So
1. George buys a car for his own use. There's no capitalism there.
2. George buys a car to sell. This is capitalism.
Notice how the car is seen differently in each case.
In the first case, George sees the car as a tool, as a thing that will enhance his ability to survive, or will up his profile among friends, or maybe he wants to tinker with it.
In the second case, the car is an object to be resold. This is the merchant perspective. The merchant doesn't see bread as food, but as a way to make a profit.
In a capitalist economy, this perspective is pervasive. It can go so far that people are looked at as mechanisms for making profit. It can have a devastating effect on culture.
But as for what the profit-making object is: it can be anything. There doesn't need to be any production of goods involved. That's just one scenario.
But in the 19th Century one could be forgiven for thinking industry and capitalism have to go hand in hand. Industrialists were huge and all-powerful back then.
Things are more complicated. Now stocks and bonds are more central.
So, you don't really have any thoughts about the prevailing economic structure of your times?
It's Bible verses to you? That's seems a little alien to me, but Ok.
Is there a kernel of truth in my thinking the state taking on private risk is least talked about (albeit most consequential) because it is a critical phase of the economic life of a mature capitalist state wherein it starts to move toward socialism strategically?
Moreover, have you seen this movement towards state-run economy attributes in other mature capitalist economies that are nearing market saturation (in the absence of wars of conquest), thus suggesting as capitalism matures, it's compelled to move away from free market purity towards a complex, mixed capitalist-socialist economy?
Note - the section in bold is excepted because it describes anti-socialistic moves.
Course not. :wink: You'll note that I said this subject becomes like debating the meaning of Bible versus.
For me your car example only hints at the surface of such discussions. My questions would be - who made the car, the labor conditions and how were they paid? Where did the materials come from to make the car and under what circumstances where they obtained? What businesses supplied the components? Who gets the profit from every point during this process and the selling of these vehicles? What were the tax concessions and tariffs loaded into the manufacturing and selling process? Etc. There's an entire ecosystem in operation. But I'll leave this to people who care more about political debate than me. This site is fun mainly for its more trivial issues like theism or what Nietzsche might have actually said.
There's no political debate here. I'm not sure why you think there is.
:up:
Bible versus again, Frank? I can't see how one can construct observations on economics without the perspectives and values from political discourse. :wink: There is no value free discourse.
This is important to dwell on I think.
It helps me to take an example. Take energy. Is there a market for energy? Obviously. But there’s no reason we have to get our energy from fossil fuels. It’s often argued that what’s produced is produced due to market pressure, but as you know this is usually complete nonsense. The fossil industry in particular loves to frame things this way. The reality is that choices simply don’t get presented — by industry or by government.
My point is: as political policies can change depending on who’s in power, both output and markets will change depending on who’s in control of production.
Cars are another example. There’s a market for them— but there’s also a market for public transportation. (Or at least a desire for it.) But public transportaiton really isn't offered, because there’s little money in it -- despite it being better for the environment, the population, for traffic and smog and so on.
If you eliminate the owners, then businesses get run not by far-removed individuals from some headquarters but by the local workers, which will definitely have communities in mind -- what's needed, what's useful, etc. So this would tend to cut down on externalities— much harder to pollute, for example, when it’s your own back hard you're polluting.
Market dependence needs to go lest we recreate similar issues— I think that’s right. I think production should be driven by needs and by use. But since it’s the capitalists that create many markets to begin with, deliberately trying to cultivate desire and demand -- even when that demand is harmful to the population or to local communities -- I would speculate that if you eliminate the capitalists, the markets will improve as well.
But as I said to @Benkei, I don't pretend to know for certain. Perhaps I'm overlooking something.
Quoting L'éléphant
It's commendable that you admit this rather than pretend the opposite. I think our way of life (including economic way of life) often gets overlooked precisely because it's taken for granted -- like gravity. "Just how things are." When challenged or questioned, it takes some getting used to.
Capitalism is something that rarely gets challenged, even today. You have to really seek it out. Marx's name gets thrown around a lot, of course, but much like other classics -- highly praised and rarely read. This could be a reason for the difficulty or lack of understanding?
While discussing the definition of capitalism, it's preferable in my opinion to put political debates to the side. First start with common terminology unless all you wanted was useless verbal spew.
It's exactly right, in fact.
There's my Twitter response for a Twitter post.
Sure, once you say anything whatsoever of substance. Or by all means continue dropping your Twitter-like one-liners on every thread that gets made.
Stay tuned. I might just say something AMAZING!
You've had 10.9 thousand tries. But I hope you're right.
Ugh. I gave you a soft pitch and that's all you came up with? You must be back on your bipolar meds. :joke:
There are so many examples around. Take the US right now: every field of social, political, marital, and private life have been transformed into a zone of intensive experimentation and contestation. One cannot work, study, raze children or have a family the same way as it was for the previous generation. You could ask how all these radical changes are related to the notion of capitalism? One of the possible answers is what Streetlight wrote: “our social (and thus life) arrangements are dependent on markets to reproduce themselves.” The conjunction of our vital social and cultural conditions is inseparable from the most acute contemporary political and economic struggles.
Quoting Streetlight
It can be more productive to expand the discussion of contemporary capitalism beyond the framework of “the exchange/production distinction so that production becomes production-for-market.”
Let’s consider, for example, the concept of immaterial labour, introduced by Maurizio Lazzarato:
” A new “mass intellectuality” has come into being, created out of a combination of the demands of capitalist production and the forms of ‘self-valorization’…The worker’s personality and subjectivity have been made susceptible to organization and command…Workers are expected to become ‘active subjects’ in the coordination of the various functions of production…The capitalist needs to find an unmediated way of establishing command over subjectivity itself; the prescription and definition of task transform into a prescription of subjectivities”. (Lazzarato, ‘Immaterial labour'). Before entering a market, a product’s particular marketing specifications have converted into a set of
a customer – a salesperson- producer relations. Further, exchange, communication, and cooperation have become transferred, internalized, concealed, and personalized. As a result, the collective and impersonal production conditions have become profoundly personal and individual. The radical expansion and mutual intensification of the spheres of production and exchange should not be limited to the world of work. In our lives, we are habitually enacting a variety of pre-given, constituted, and defined communicational and informational models and networks incorporated within the processes of capitalistic valorization. Likely, that is close to what you mean here: “our social (and thus life) arrangements are dependent on markets to reproduce themselves.” To not lose the original-Marxist critical anti-capitalist perspective, it is worth to combine an expanded socio-economic approach with the notions of various surplus-values, apparatuses of capture, relations of power, and individuazation.
As a result of the conjunction of these dimensions, on the personal level, articulating theoretical or historical perspectives on capitalism is also a matter of enacting a particular subjectivity, agency, or identity. And what is stated or declared can, in the long run, assist the reinforcement of the object of critique. It is another reason for the expansion of the theoretical anti-capitalist framework.
I'd hold the view that any discussion of capitalism, all the terms used and their relationships to each other and how they are understood systemically involve presuppositions. There is no free world of 'terminology' without perspectival relationships.
I agree. As you may have noticed, a discussion of capitalism becomes a discussion of history.
History is a dangerous topic because we take it to be an unbiased look at the facts. A little philosophy says that as much as we may long to have that unbiased view, it's probably not really available. For us English speakers, that usually means Eurocentrism, as if nothing important ever happened beyond European dominion.
On the one hand, there's never been a culture more pervasively influencial than Europe. But the problem with being Eurocentric is that we miss out on valuable perspectives.
So yes, there will be some bias in any discussion of history. We can still put politics aside and agree on something as basic as the definition of capitalism, though. The only thing standing in our way is ego: the one thing that has always screwed leftists.
I know you're using shorthand in the statement "profit over everything" but to try to spell out what I find to be pivotal to this: profit for whom?
I think most will agree that it ought to be “profit for those deserving of it”, harkening back to what initially was the satirical term “meritocracy”.
Current global economy works by selecting for, as you mention, short-sighted interests profiting over long-sighted interests. Pithily expressed in the dictum “greed is good”. So those who are most greedy then gain most profits and, in tandem, most power over the way things should and will be - selecting against most all non-greedy interests, this in the long term at least.
For instance, you have 10 corporations with stocks that compete. As it currently stands in the world we have, if one of these ten corporations desires to invest some of its profits in being non-toxic to the environment, it will make less profits in the short term. Stock owners will then tend to invest in any of the other 9 corporations, resulting in this one environmentally sound corporation loosing out and, quite possibly, going out of existence. The corporations with short-sighted interest profit at the expense of those with long-sighted interests, as so too profit those investors in stocks who don’t care about long-term consequences but about their short-term profits.
I find that governance - here tersely read as intent regarding future outcomes - of some kind is always in some way in control of economics - here tersely read as what resources are appropriated to whom. And never the other way around. As a more concrete example, the state always governs who has what in some way - taxation laws as one example - regardless of how de-regulative it claims to be. This in order for the state to maintain itself. Trouble is, there of as yet is no (one would hope democratic) global governance regarding things such as a globally uniform taxation policy, despite there being a quite global economy. Which results in those countries that are more long-sighted in their governance of economy tending to lose out economically to those countries that value short-sighted profits. Simplistically, any country that increases the taxes of ultra-rich corporations, for example, will have these same corporations migrating as best they can to countries where these taxations don’t occur (the same can be said of individual states in the USA), and so will lose out on profits from taxes - inevitably impoverishing its citizens. Globally, this general problem to me is most apparent in terms of corporations’ migration to countries with little to no labor rights, hence where corporations maximize their profits via exploitation of workers … leading to a global race toward minimizing labor rights.
At any rate, I tend to agree with you. But I don’t find the problem to be that of profit over everything per se (to the extent I'm interpreting you properly) but, again, that of the human-devised system we currently have (which will inevitably select for profit being realized for some human traits at the expense of some other human traits) such that what is selected for nowadays is short-sighted interests at the expense of long-sighted interests. Which those who seek to become wealthy must incorporate to so become.
For the record, I can’t discern any easy fix to the problem I see in current economics. Still mentioning it because I find there can be no resolutions if problems aren’t identified. Maybe tangential to OP, but still...
Funny line but that's why these debates are pointless. You presuppositions are showing...
Which is what? Just curious.
Ok. What presuppositions do you think I have?
I only said they were showing (in that example), not that I could see your entire outfit.
Here -
Quoting frank
But you knew that and this isn't about us. Maybe we can engage about some other shit later on.
Yes! :up:
:up:
I think humanity has never been in a more precarious situation. Hopefully we'll muddle through, but I think the first thing that needs to be acknowledged is that no one is at the helm. There are no effective captains of the ships of state, and arguably never have been.
Programmatic or revolutionary thinking is doomed to failure in my view, and the only hope can come from full acknowledgement that the future cannot be predicted and controlled. But the conceit that it can and must be, and that otherwise we should be subject to the profoundest and most crippling anxiety and confusion. is deeply rooted in the collective psyche, I fear.
Historically, mega-debts just disappear during large scale economic contractions. Capitalism magnifies natural cycles of growth and decline. During booms, capitalists seem undefeatable. During busts we wonder why we ever thought living this way was intelligent.
I think a new religion will eventually emerge and absorb concerns like environmental exploitation and global warming.
Quoting Janus
Why do you see this as paramount?
But this is straightforwardly wrong. Interest has been around long before capitalism has. To imagine that interest is the diffentia specifica of capitalism is simply to ignore history and pretty much anything anyone has ever understood by capitalism. If you want to call that capitalism you can - I can't stop you - but you and I - and most of the rest of the universe - would then simply be talking about two entirely different things.
That said, there is a grain of truth that the OPs presentation is somewhat outdated. Something strange has indeed occured with the ascension of finance, which is the shift from commodification to assestization as the key driver of the economy. I mentioned this in my 'note on financialization'. It's true that this deserves to be further thought though, but the OP's focus was to distinguish markets from capitalism above all, rather than be a proper diagnosis of the present. We can talk about the latter of course.
That's true. They aren't the same thing.
Damn. I tried to make it as clear as I could. @Tom Storm is exactly right to pick up the production/exchange distinction as the key to it all though. Maybe I should specify: "production" literally just means: the making of stuff. And exchange just means: the moving of stuff from one person (or entity) to another (and vice versa). And that one problem with thinking about capitalism is that alot of people think capitalism has to do with how stuff is exchanged, and not how stuff made. Or rather, where or what stuff is made for - for markets, or for other, social reasons?
Dollars, at heart, are just a measurement system like inches. However, I can design a building with limitations inherent to the actual construction materials. I can design a million mile high skyscraper for example, but no one could ever build it. So when you hear of "trillions" of dollars in national debt, you can immediately discern that the financial system that allows that is completely disconnected from real economic possibilities. It's no longer any kind of capitalism or even free market system, it's fairy dust.
Bingo. Money is an abstraction, divorced from anything real. Banks create virtual money.
A capitalist economic boom is a gambling casino. None of it is tied to anything real.
Again, this is another thing that is straightforwardly wrong and ahistorical. Money is yet another thing that has been around long before capitalism.
So that's at least three things we can now say capitalism is not: markets, interest, and money (or finance rather). These kinds of confusions are fun to clear up.
What's with the preoccupation with hitting capitalism with one dart?
It's about profit. There are all sorts of activities that can result in profit.
To understand finance, you need to focus on the fairy dust, as the guy put it.
I think you misunderstand. I didn't say that money is capitalism. Specifically, I said that "profit is tied to the accumulation of currency." The concept of profit is central to capitalism, but it is not directly connected to the accumulation of money but to the production of an economic surplus that allows economic activity to expand and grow in real economic transactions from labor to production to consumption.
At heart, the implication is that money is the proper measurement of economic activity, but that is only true is the currency of transaction is limited by the real activity of an economy.
However, the vast majority of money produced in our economy is the result of a financial sector that does not need to be held to actual economic reality anymore because they can produce as much money as they want in the form of debt and that debt does not ever need to be repaid.
It is about profit, but it is not just about profit. And it's not about 'hitting capitalism with one dart'. It's about understanding the specificity of capitalism, rather than drowning it in ahistoricisms. Again, profit has also been around since forever, and is not specifically capitalist.
Four things capitalism is not: profit, markets, interest, and money. Can we add more?
Again, holding fast to the distinction between exchange and production, this does not get to the heart of capitalism insofar as it tries to understand capitalism in terms of exchange. Like thinking of capitalism in terms of markets, this too is a common mistake, but it is still a mistake. But I will try and say something more about money and finance when I have time because clearly there is alot of confusion that stems from this.
Yes. You can add "why things are made."
However, the problem is that none of us were alive in the 1700's to experience what the socio-economic system of the time was that was replaced. Essentially, capitalism is the attempt to separate economic power from aristocratic power. Prior to things like the French and Russian revolutions, ownership of land - the economic engines of the time - was reserved to or controlled by inherited noble and royal family lines. Also, the rights to produce certain goods was by an aristocratic or royal decree. In addition, mercantilism or protectionism restricted people from importing goods and kept the economy closed.
At heart, the revolutionaries wanted to free the economic system from the dominance of hereditary family control limited to national (or kingdom or realm) interests. Anyone that could raise the capital to produce a business should be free to pursue that - from building a factory to owning productive land free from royal tribute to importing goods more cheaply made in foreign lands - the basis of the entire shipping industry that grew up in the 18th and 19th centuries.
Then Marx pointed out that the original owners of the new capitalist endeavors or projects would become a new and even more pernicious form of aristocracy - oligarchs - than the one that the revolutions decapitated. Merchants and mill-owners would be the new nobles and kings but not restricted by any social compact between king and commoner.
You can't really define or understand capitalism unless you look at what its original proponents intended it to replace.
True again. But this is Eurocentric, isn't it? Or should we think of capitalism as an entirely European invention?
The essence of capitalism is capital growth or profit, over and above any growth in actual products. Once ownership became established then usury was conceptually enabled. Usury just is capital growth without production. When was the "official date" of the beginning of capitalism according to you?
Quoting frank
I don't believe mega-debts can simply disappear without consequence, even in the purely economic context. In any case, in the more encompassing ecological context under which the economic context is and should be understood to be subsumed, we are accruing a mega-debt to the environment, to the Earth and it's resources and other inhabitants, a debt which is indifferent to our current financial status in the cycle of "booms and busts".
Quoting frank
Such an undesirable thing may happen and "absorb concerns", but that doesn't mean the problem will have gone away.
Quoting frank
Revolutionary thinking is doomed to failure insofar as it seeks to wipe away existing institutions and infrastructures without understanding the consequences. Programmatic thinking is doomed to failure insofar as it seeks to impose new conditions from above. Both are based on the erroneous idea that humanity can predict and control its future.
The only thing which will help our situation is education and widespread individual change of thinking and orientation based on reasoned understanding of the human situation and acknowledgement that the future must remain pretty much unpredictable. Failing that, we're fucked; it's just a question of when; of how long the smoke and mirror show based on denial can be kept going.
Well, yes, but only because it is specifically something that originated in Europe. Ironically, I'd say that Asian capitalism began with Imperial colonization, but really took off with communism. It is hard to think of any more rapaciously capitalist societies than Oligarchic Russia or today's China (more an innovation of autocratic capitalism) which both emerged from decades of communist rule.
However, is that simply the continuation of the cultural expectations going back to the Tsar and Emperor respectively?
The question remains if we have actually ever seen anything truly capitalist or if our societies are simply innovations on social power structures that we've always gravitated toward. Are we in fact still in an essentially feudal or Medieval society. Note, I do believe that the Middle Ages are much more similar to our present day experience than something like Imperial or Republican Rome or Athens or Pharaonic Egypt.
At heart, I think the ideal of capitalism is what Steve Keen learned was the "best and second best economy."
The best economy was a class of small employers competing for a class of independent employees. This would ensure the optimal wages for workers, optimal prices for goods and optimal profits for employers. The second best economy would be large conglomerated employers contracting with organized workforces. Basically, corporations and unions would ensure a volatile but sustainable level of wages, prices and profits. Not great, but better than what we have now.
Unfortunately, neither is truly realistic as every economic system assumes that the natural world will support it. As we're discovering with the current supply chain failures, the demands of a world based on physical principles does not easily support any economic system that assumes infinite abundance or scalability.
To understand capitalism, the first principle must be that it is not realistic. You can't look to the real world as the principle is inherently imaginary. However, that is true of any economic system. Capitalism only works because eventually everyone dies, so it doesn't have to work to provide for everyone - though theoretically it purports to. Politics follows this same principle. Eventually, the people who have serious problems will die, and those that survive didn't really have that problem, and the politicians declare that they solved that problem.
But your idea that using a process of elimination is valuable in understanding the concept. The original concept was that power and wealth are the rights of inheritance. The king leaves his kingdom to his son. The noble leaves his land to his heir. Whatever is valuable in a society - like land - is the sole right of a certain family claim.
So, to obtain power and wealth, one has to steal it often by murder from those that own it and then form a completely new dynasty. Obviously, this is very inefficient and ineffective. First, there is no guarantee that heirs will have the same capacity to generate such wealth, and it requires all sorts of wars and bloodshed for any innovation to enter the system.
Therefore, to add efficiency to the progress of economic prosperity, create a system where anyone with a good idea can obtain the capital (in practical terms funding, but in conceptual terms, the legitimate ability to take action) to manifest that idea and then let the freedom of his fellow individuals (in the market in practical terms) either take advantage of the idea to their benefit - thus, success and profit - or determine that it is not in their benefit - thus failure, but without bloodshed.
In this way, every one may prosper from the efforts of every other one. In its basic form, that is the declaration of capitalism. It goes hand in hand with the idea of democracy as opposed to aristocracy, but in reality, it often falls short and retreats back into basic chieftain mentality.
But this is not true. Or at least, this remains only a partial truth, and far too abstract. One needs to make a distinction between the mere existence of capitalist enterprises and capitalism as generalized mode of production. It's true that capitalist enterprises - enterprises whose raison d'etre is to make profits - have been around since whenever. It really doesn't matter. What does matter is when social reproduction (the reproduction of society) becomes dependent on such enterprises, and relies upon them as a condition of their existence. That's the 'ism' part of capital-ism. This is broadly why one can make a distinction between feudalism and capitalism, even as instances of capitalist enterprise could be found all through feudal society.
In other words, capitalism in unthinkable without taking into account the securing of its conditions of reproduction. And those conditions are precisely the point at which the production process in general becomes 'subsumbed' - in Marx's words - to the capital. In yet other words, you cannot think about capitalism as an abstract schema ("capital growth and profit') without taking historical account of when such efforts at growth and profit became generalizable, reproducible, and, as they say, structural - i.e. when societies become dependant on such processes of generalizing and reproducibility.
Capitalism needs to be understood in materialist terms, not idealist ones. Usury may be capital growth without production; but without taking into account the material conditions under which such efforts at capital growth are reproducible, then you're just talking words, and not history, or, for that matter, reality.
In the depths of feudalism, the lord is a warrior. He feeds his army on the spoils of war. The clergy is holed up in monastic fortresses. Everyone else is a serf: bound to the land and restricted by custom and religion to a life of slavery.
The crusades injected change. The influx of goods from the middle east woke Europeans up to their low level of civilization. The feet that beat down those trade routes belonged to the ancestors of the European merchant class.
They found freedom from servitude in profit-making. Their markets became cities. They tore down Christianity and built back a version that accepted them as being just as human as the nobility.
It wasn't about efficiency. It was about becoming human.
So, as I see it, sweeping, rapid change is unthinkable and not worth wasting any intellectual effort on. The only way to effect any (modest) change at all will be from within the system itself. The system is now a juggernaut which cannot willfully be stopped, although it could indeed collapse, and inevitably will, if we don't address the problems of overpopulation, environmental pollution and destruction, resource depletion, impoverishment and destruction of soils, global warming, etc, etc. Problem is we can't predict when or how that will happen, so for the time being it is possible to remain in general denial.
Worth starting with profit, a notion which is sorely missing from the OP. Picking up where I left off with @Janus: Yes, it is in fact the case that the pursuit of profit is the abstract heart of capitalism, and it (capitalism) only reproduces itself in and as the pursuit of ever more profits on an ever widening scale. Production on the face of it has nothing to do with this, and capital will in fact flow to wherever in the economy and world where it can make profits. Which is what we see today with the massive shift in activity from the so-called real economy into finance and speculative activity. Hence the predominance of rent, debt, the stock market, housing going out of control, private equity, stock buybacks, investment fund ballooning and so on. Basically, all the pathologies of contemporary economies. Fine.
But the Marxist rejoinder is twofold: first, that this can't continue indefinitely. Why? Because people need to fucking eat and not be dead. Which can't really happen very well when 'growth without production' is the functioning principle of one's economy. There are, as it were, natural, or rather, material constraints on this kind of growth. Which is again why this kind of thing cannot be thought about in the abstract apart from the conditions of its reproduction. Second, it can't continue because at the end of the day, finance is parasitic on the real economy (i.e. production and consumption) as the condition of its own existence and growth to begin with. Merely pointing out, as @Frank does, the preponderance of finance is meaningless if it not recognized that the financial house of cards is built upon the ever more thinning foundation of an economy that still needs people to eat and not be dead.
Which is in turn why capitalism can never, and will never, be adequately thought apart from understanding its roots in production. Capitalism may be about profits above all, but there is in fact one thing above that: which is its own reproduction, and securing the conditions under which such such profits can be infinitely pursued, whether in finance, or anywhere else. That all said, one real tendency is the effort of capitalism to undermine itself. It has never really had a problem demolishing societies and people in pursuit of profits, along with its own conditions of reproduction, so long as it substitutes new conditions for the old ones. But I think this ability to 'substitute' is reaching its limit, precisely because finance's ever extending divorce from the real economy. Capitalism always moved forward by revolutionising the 'forces of production'. But those revolutions are coming ever more to an end. Is it any surprise that we're in the middle of an unprecedented crisis of capitalist innovation?
After the saturation of globalization and failures of neoliberalism, is it any surprise that the cutting edge of innovation is... dogecoin? Or else that stupid juicer that was meant to revolutionize silicon valley?
Strangers asking for directions in the street and co-workers passing pens to each other across the room are examples of incorporating markets into wider circuits of social life?
https://www.zerohedge.com/markets/goldman-rings-alarm-collapsing-market-breadth-51-all-market-gains-april-are-just-5-stocks
"Goldman then calculates that just the five most popular tech names - AAPL, MSFT, NVDA, TSLA, GOOGL - have contributed 51% of S&P 500 returns since April. After contributing over double their starting weight to the index’s return, these stocks now make up 22% of the S&P 500 by market cap, a 4% increase from the start of the year."
You're getting into deeper philosophy here which touches on Hume, Hobbes and Locke and Emerson. It is hard or even impossible to separate both utilitarianism and transcendentalism from capitalism as it became expressed in the ages after the dominance of aristocracy and royalty.
Essentially, people that found themselves with the means to compete with aristocracy wanted to express and manifest their own desires but without the constraints of a heraldic order. It is important to remember that the nobles and royalty were as constrained by social standards - even moreso than the commoners were.
The early "capitalists" or "bourgeoise" may have been preaching fraternity and liberty for all men, but they really just meant all men like themselves. "All men (like myself) are endowed by certain inalienable rights" but not my slaves or women or the laborers from overseas.
An interesting point in this is the "free labor" movement that brought Abraham Lincoln to power.
Of course, there were abolitionists that simply argues slavery was immoral. However, Lincoln was not one of these. Instead, he had been born in Kentucky, a slave state, where his laborer father could not make a living competing with slave labor. His family moved to Indiana and finally to Illinois where his father could make a minimal living wage since he did not have to compete with slaves.
The argument against slavery that Lincoln typified was not essentially moral but based in capitalism. Labor was a commodity that workers should be able to market unencumbered by other men. Even Marx would write pro-Lincoln articles in this regard. Therefore, slavery - though it was the engine of capital especially in the form of the most valuable commodity of the age, Cotton - was inherently anti-capitalist in the view of Lincoln and most Republicans of the time.
So, it is a paradox that slavery provided the basis of our modern capital but at the same time was abolished by capitalist principles.
I didn't say capitalism should be understood as being all about finance. Neoliberalism put finance at the center of the global economy.
This is probably wrong, but it's the best I can do right now:
1. Embedded liberalism exists post WW2.
2. This, along with active labor unions results in high wages.
3. This leads to a problem with capital accumulation. For some reason, the point is reached where banks can't make a profit and credit starts to disappear.
4. Stagflation arrives due to an oil supply shock, and this opens the door for the "manufacture of consent" for an economic overhaul that ultimately destroys the power of unions.
5. Eventually America has reduced industrialization, a much more timid workforce, a new elite, and a new middle class that fully embraces neoliberal principles.
6. 2008 arrives, and we've been in limbo ever since. Real wages, which were already low, are even lower post 2008, and this is supposed to have caused Trump's election.
7. High inflation is now setting in and real wages are dropping even further.
I think neoliberalism was supposed to create social stratification for the sake of capital accumulation. The stratification didn't end up being linear over time. It's accelerating?
[quote=Streetlight]Oh good, coming from you, this means I am exactly correct.[/quote]
:snicker:
The beauty, if it is, of capitalism is that you can lend the same money to 10 different people, at least that's how it is in the US according to Yuval Noah Harari. That's called killing two birds with one stone or for the more animal rights oriented, feeding two birds with one scone. It's a most ingenious scheme if you ask me. By the way I'm a poor person!
Intentions are really quite irrelevant in the face of reality. But really, I do agree with most of what you're saying. I guess I'm not sure how it is meant to function as a response to what I wrote?
Do you have an example of Lincoln expressing this perspective? Specifically the free labor angle.
I think essentially it is similar to trying to define any concept. It only has meaning in relation to the context in which it functions. Capitalism obviously asserts capital, but what is capital? Capital is at heart the ability to take some sort of action. The ability is the legitimate right to take that action. So, it is a question of what conveys that right. In mercantilism, it was the aristocratic or royal power inherited by familial descendance. In capitalism, it was the free choice of men by their own personal wealth (owners) or the application of their own labor (workers). Even though that wealth may have originally been generated by the aristocracy, the transformation was that it moved freely separate from the strictures of aristocratic social structure.
So, capitalism was inherently associated with early ideas of liberalism where individuals could make choices that were not constrained by the aristocratic society. It is an expression of social philosophy, and not primarily economic.
But this is quite wrong. Capitalism can only take root where its conditions of reproduction can be secured. And those conditions are material, and not ideational. Liberalism's ascendency was a reflection of the growing and real power of the bourgeoisie in society who did indeed feel constrained by the fetters of feudalism. The articulation of liberalism was an effort to express that in ideational form, and secure an intellectual foundation for their own preferred mode of extraction.
And where does he condemn slavery specifically because free laborers have to compete with slaves?
He didn't. His arguments had two objectives. First, he did not oppose slavery in the south, he opposed slavery in any new territories. Second, the slave owners made the argument that "wage slavery" in the North or free states was even worse than slavery on plantations(it wasn't really) so he had to argue that even though wage labor could be very oppressive, the worker still had the opportunity to escape it while slaves never had such an ability.
Lincoln did not condemn slavery in the sense that the abolitionists did before he was elected, and his actions against slavery were never on philosophical grounds but to, in the end, weaken his opposition. Nevertheless, the free soil and free labor movement are what put him in power and eventually what won the civil war.
However, even where capitalism can take root, it does not do so without the liberal ideology to support it. Mercantilism or feudalism can also express itself in exactly the same conditions. So, the explanation why capitalism expresses itself arises in the liberal ideology rather than the conditions.
This isn't true, but it's off topic to pursue it. :wink:
Says who? I mean, sure, capitalists retroactively justify their class position with all sorts of fairy tales, but the fairy tales do not preceed those class positions.
Lincoln was a moderate in this sense and his principles aligned with theirs. This is what gave him the advantage in his pursuit of the presidency. The abolition of slavery was essentially an economic necessity and he even for a time proposed sending all the slaves back to Africa so America's workforce would be entirely white and free.
But that is not capitalism in the ideal sense. Class positions break down to aristocratic without the ideal of social mobility - and infinite development. The constraints of the real world will tend toward accumulation of wealth that ends in an aristocratic and royal system, but capitalism is based on an infinite frontier that can provide opportunities for all free men. For capitalism to flourish, there always needs to be a "new world" or "digital frontier" but we always seem to regress or settle back into the normal hierarchies of king and commoner.
Additionally, even in the oligarchical system - or robber baron - which is the aristocratic version of capitalism, the oligarch will not be able to pass on his wealth to a genetic heir - or more to the point, whatever heirs he may have will not be able to hold onto it, so a new frontier opens up as soon as the oligarchs pass away and it opens a new surge of capital for the opportunity of the next class of capitalists.
I'm not concerned with 'capitalism in the ideal sense'. A red herring, ignorable forever.
However, that is the only "real" version of capitalism available. It's like baseball. I can tell you all the rules involved in the game, but knowing every last detail of the rules of the game will not tell you anything about how an actual game will turn out.
So, do you want to play a game of baseball (or watch one) or know how the game is played? That is essentially the problem of defining capitalism. What happens on the field is not going to match perfectly to the rule book.
No, the Southern Democrats walked out of the 1859 Democratic National Convention and subsequently ran their own candidate, splitting pro-slavery vote. That's how Lincoln won.
Quoting ASmallTalentForWar
No, the Dred Scott decision promised to nationalize slavery, and the wisdom of the time was that once this happened slavery would never be uprooted from the USA.
Quoting ASmallTalentForWar
Lincoln made his principles known. He believed that slavery was a threat to the vision of the free society. Once people get used to someone else doing their work for them, they lose sight of the meaning of freedom.
None of that contradicts my assertions.
How did Lincoln get into the position so that the split vote gave him the advantage? The defining characteristic of his campaign was the free soil movement.
The Dred Scott decision threatened the economic interests of his supporters who wanted the frontier to be primarily free labor.
A free society to Lincoln essentially meant free labor.
I don't know what you are talking about.
The Whig Party fell apart after the Dred Scott decision. Lincoln was instrumental in gathering all the anti-slavery groups together into the Republican Party. It was said that the more experienced politicians chose him as the presidential candidate because he was politically naive and they thought they would be able to control him.
Quoting ASmallTalentForWar
That's incorrect. It meant social mobility.
Back at you. It feels like the old idea of someone asking what something means but providing no real context.
If you ask what is "capitalism" -well, that is only a concept and concepts only exist in relation to their context. So, conceptually, capitalism is simply the application of capital. Capital is the legitimization of any action by social agreement. Social agreement means investment by a communities shareholders. Finally, the success of one's actions is judged by the creation of greater capital and failure by the diminishment of all shareholder's capital.
It's a simple process determined by both markets and currency value as measures but not inherent elements of the process - essentially the game and the scoreboard.
Mobility by what process other than the fruits of one's labor?
The vision of the free society is about social roles. No one is locked into a particular role.
All of this is wrong. People do not live under "concepts". People live in realities, of which capitalism is one. If you keep trying to understand capitalism as an idea and not a reality, you will not understand it, and confuse the issue in perpetuity.
Oh - I thought you wanted an actual answer. Apparently, I was mistaken.
Capitalism provides simply a progression of comfort for those that engage in it in real terms. Other than that, it is conceptual.
I agree, but what role is separate from the labor associated with it? In aristocracy or rentier economies, ther are roles without labor, but what do you think Lincoln was talking about?
There is nothing socialist about states taking on private risk. The risk being taken on is that of corporations, without any concomitant control; ownership remains in private hands, and states taking on such risk simply means that corporate failure is ultimately underwritten by taxpayers. It is capitalism taken to the nth degree such that private enterprise parasitizes on public finances. The socialization of risk place more burdens on society, to the benefit of capital. It cannot in any possible way be understood as socialism.
I don't understand. Do you have anything more interesting to add or is this the extent of your contribution? So far, it seems fairly traditional with nothing unique in the historical perspective.
Agreed. The "bail out" comes at the cost of the taxpayer which is heavily weighted toward the working class -- and fiat money production which ends up as an implied tax via inflation laying more heavily on working class positions.
Quoting Number2018
I think such discussions have their place, but are they ultimately consequences of capitalism. Yet people cannot even get their head around basic principles, and so confuse markets, interest, finance, and profit with the existence of capitalism. There is interest in talking about individuation and so on, but at some point this stuff is mystifying rather than clarifying if our basic concepts are not fixed.
Hmm, but without eliminating or curtailing the private property form, are we eliminating capitalists, or expanding the pool of capitalists such that everyone gets to be one? To be clear, I'm all for this in a strategic sense. So long as capitalism is ascendant, sure, let's make everyone, every worker, a capitalist. This would immeasurably improve life of everyone on Earth.
But to pick up on public transport: if the condition of reproduction (survival) of say, a worker-owned public transport system is still, say, its ability to make profits (and it still would be, even if if it is worker owned), its still not clear that they would not eliminate, say, necessary but little used routes. Or buy cheaper, but more polluting buses to keep costs down. Or build train tracks that geographically cater to other corporate (but worker-owned) interests, rather than social need? Like, I'm not saying all this stuff will happen, and it is almost certainly less likely to happen than under current circumstances.
But so long as the damoclean sword of market-dependency - and as I understand it, capitalism - hangs over it all, these temptations will be structural and not individual. It's less about intentions than just survival. But really, my interest here is using this as something like a litmus test for what counts and does not count as capitalism. I think it's important to see exactly where its limits and borders are, if only to understand better what might or can lie beyond them. It seems a small trifling thing to call even a worker democracy capitalism, but the worst thing than can happen is to believe we are beyond capitalisn even while we remain firmly in its grip.
When a state underwrites private risk with taxpayer money, do we speak truthfully when we say that taxpayer money is queer venture capital via which the state participates in the market, except, however, the venture capitalists i.e., the taxpayer-investors, down the line, are excluded from profit participation in the event of private risk ultimately turning a profit?
Do we speak truthfully when we say that the state, in deciding to invest in private risk with public money, acts the role of a queer stockholder on behalf of a corporation, and thus the risk portion of the venture exemplifies a state-run business?
Do we speak truthfully when we say that the taxpayers, in raising the public money that underwrites corporate ventures, does the work of financing production for the market, but receives zero payment for its work?
Do we speak truthfully when we say that conventional underwriting of private ventures with public money as with, for example, the public underwriting of potentially lucrative research & development programs conducted at universities, exemplifies taxpayer-funded welfare for the corporations?
Do we speak truthfully when we say that public underwriting of private ventures exemplifies a queer conjunction of private_public enterprise i.e., a complex mixture of capitalism_socialism?
I think of worker control as public control. It’s simply putting the power in the hands of the community (represented by the workers) rather than a handful of wealthy owners. It’s not public in the sense of being state-owned, but it skips over the state in that respect and goes directly under community control.
But on the other hand, you’re right — a co-op corporation that’s worker owned can also become national or multinational in scale and so disconnected from local communities. Production for profit is still there as well, even if not the sole motivating force — and this can turn into a problem as well. And I can anticipate a flaw in my argument you probably notice: workers controlling a factory or business isn’t the ENTIRE community. Not everyone gets a vote or input into how the company functions. But since I’m assuming the workers represent the community, that this will work itself out. Plus other channels for public input can be created by governments or companies themselves.
Maybe abolishing private property altogether is the ultimate answer. I tend to agree with this. But my (perhaps nitpicking) point was about abolishing capitalism (as I understand it) rather than every necessary condition for capitalism. That’s what my initial question was getting at: if we’ve eliminated the employer/employee (or owner/worker) distinction, then we’ve eliminated the one feature that (arguably) distinguishes capitalism from other socioeconomic forms— like feudalism.
But let me assume market-dependency is the primary problem. I’m interested in hearing potential solutions.
Quoting Streetlight
Absolutely. Which is why it's important to have these conversations. As I said at the beginning, I don't pretend to know exactly what will happen. It's largely speculative. But we do know how it's currently organized, and we can see very clearly how that's turning out. So some new goals need to be talked about either way.
I think one of the problems here is that the issue is with the material constraints certain systems impose on decisions. Anyone working in a system with private property (in terms of land, means of production) will have decisions about how to run their business constrained by the conditions of that system - such as a need for sufficient income to pay the rent/mortgage, and a reliance on the returns from that system (product value) to cover them.
All the while these constraints are in place, democratisation of the decision-making only widens the number of people whose decisions are thus constrained. It doesn't actually work to remove any of those constraints.
Certainly...but again, we're talking about capitalism. If one argues that private property is the defining feature of capitalism, then to talk of dismantling capitalism would have to be a discussion about how to abolish private property. That could very well be true, but if we define capitalism as being what it is because of its relationship of one class to another, then it's this relationship which should be the target -- and so abolishing this relationship topples capitalism. I think worker ownership/control can do that -- co-ops being one model, a step beyond unionism.
But ultimately yes, I think the entire idea of private property should eventually be phased out. It's just that private property can exist in a non-capitalist system as well...as can markets...as can profit-making.
Quoting Isaac
With the above being said, my response would be that while worker control doesn't solve the problem of private property, it would be tending in that direction.
If I could snap my fingers and make the system of private ownership and private property disappear, I would. But we're a long way from that in my view. Cooperatives already exist, unions are (weak, but) around, our state legislatures and local governments are there to experiment with, etc.
Also, China has gone much further than the US towards your point, with limited rights on private property -- yet they too have capitalist enterprises (in the sense I mean). Huawei is an example; Alibaba, etc.
Everything I have written has to do with what I originally wrote, if not with the OP itself. I wouldn't expect you to agree, in any case, since we obviously come from very different sets of presuppositions about the human condition.
Then no doubt you can spell out the connection between treating capitalism wrongly as an abstract matter of profit growth and two paragraphs of wallowing defeatism.
I haven't claimed that capitalism is merely an "abstract matter", so I have no idea what you're driving at. I also haven't claimed that there is no hope that it will change; I think it will change eventually, either through some catastrophe, supply of resources hitting a wall or enough people realizing that spinning money out of nothing is a flawed notion that will ultimately bite us in the arse.
If you believe you can bring it down by "throwing spitballs at Mt Everest", then go right ahead; I will applaud if you succeed.
(And no, you didn't claim capitalism is an abstract matter, but that is what your claim comes down to; in any case it doesn't matter. You made an assertion. I'm asking you to account for it.)
Quoting Janus
And you being wrong about this?:
Quoting Janus
Which is what I was responding to.
It looked like the purpose of this thread is not just to fixate the basic concepts but also to show why the critique of capitalism is still productive and applicable. That is indeed mystifying! Likely, what keeps all discussions about capitalism alive is that our society operates the founding capitalistic principle of benefiting from the interplay of various heterogenic levels. Yes, there have been a variety of dominating economic and financial concepts. Still, the system has survived all crises and developed further due to its continuous grounding in a private, individual, and intimate field. The spheres of production and exchange have been mediated, maintained, and animated by the most individual desires. And that is what Marx meant when he said that the true difference is not the difference between the two sexes but the difference between the human sex and the ‘nonhuman’ sex. So, we invest in our economy not just when we work, bye goods, stocks, bitcoins, play games, or consume. Our deepest, intimate desires: to live a social life (and thus life), have an identity or realize our moral aspirations have been interconnected with the impersonal movements of the monetized neoliberal processes. The foremost task of critique today should be to explore this metamorphosis of exploitation. How can the system neutralize, appropriate, and utilize even the most potent protest movements and sentiments?
I don't acknowledge that I was wrong about that. You haven't explained why you think I am wrong other than to claim that I was saying that capitalism is merely an abstract matter; which I have already corrected you on.
Mm, but that's why I've argued that the employer/employee distinction follows from, or arises under the conditions in which, capitalism has already begun in institute itself. To condense the question, what is the differentia specifica of capitalism? It is market-dependency (which in turn undergirds the pursuit of profit, which is the other pole of capitalism?), or is it the class relation of capitalist and worker, employer and employee?
Two points to make: first, that employer-employee relations predated capitalism: contractual obligations between workers and employers can be found all through antiquity and the middle ages, even if not the predominant form of labour; second, while I agree that the predominance of capitalist-worker relations do track with the advent of capitalism, they, again, follow from the dispossession of the means of production (farms, looms, equipment, institutions of learning and apprenticeship), and only once they are taken possession of by capitalists who turn it all into pure capital: means of profit making. Again, the market-dependence comes first.
That all said! These distinctions are primarily analytic before they are strategic. Regarding what you said might count as a 'flaw' in your reasoning, that worker-control never represents 'the entire community', believe it or not I don't think that's a flaw. Primarily because I don't think 'the entire community' is something totalizable: politics and community take shape in their working themselves out. People and communities are not little pre-made packages of interests and desires! Which brings me to the question of what you call solutions: how mitigate market-dependency?
Well, some very basic socialist principles!: enable and institute a robust thriving baseline from which people can participate in their communities: this means housing for all (and if this means abolishing housing rent, then so be it), deep and well oiled healthcare systems not subject to profit, expansive and accessible public transport systems (which means eliminating car dependency and vastly mitigating oil dependency!), the absolute commitment to food and water security, which would in turn mean agricultural production that itself is not dictated by market imperatives and so on. None of this is particularly original, and you among other will have heard it all before.
But what's important about these things is not that they're just, as it were, goods in themselves - although they are that - but because they count as the minimal conditions from freeing ourselves from market-dependency. If there is a place for markets in the future where the planet is not dead - i.e not our current future - it's going to be as a stratified layer on top of, not our 'basic' needs, but our incredibly well-met wants. Markets will be luxuries, side-projects, art-affairs. And of course, worker control will be key to all this too.
Thanks Toby - I appreciate it.
I see what you mean, though what you'd need here is stakeholder ownership, rather than just worker ownership... but I suppose if you define capitalism that way, then yes, eliminating the owning class would eliminate capitalism. I'm just not sure capitalism is sensibly defined that way.
Quoting Xtrix
Well... with limits. It's not the mere existence of private property that's a problem, but the effect of private property in constraining the decisions people make to those dictated by a market. One only need remove that private property which is effecting that constraint.
Quoting Xtrix
Interesting. I kind of see the two as quite separate (although I agree that worker control is a great thing). How do you see them as linked?
Quoting Xtrix
Well, yeah. The question is to what extent the state acts as a private property owner there. The possibility of state control over private property is largely why I phrased my answer in terms of constraints, rather than actual possession.
I believe modern day capitalism is derived from the practise of mass production. It came upon us hand in hand with the industrial revolution. Huge factories to produce huge quantities of goods required huge amounts of capital to establish. Technical advancements propagate capitalism, assembly line appliances, cars, airplanes, these factories all need to be retooled each time there's a change in the marketplace, and change requires more capital. Our throw-away society produces a greater need for goods, and the new ones must always be an upgrade from the old.
Inherent within capitalism is the practise of making profit from a loan, what we call interest. This is a side-shoot of capitalism, and it can be apprehended as a sort of easy-money, which gives privilege to those already endowed. That creates the appearance of a financial inequality amongst people, allowing for a privileged class of those who have the freedom of easy-money.
So, I decided to self-diagnose the affliction I contracted reading this thread ( :sweat: sorry for lack of a better metaphor. I posted previously that I did not recognize the kind of capitalism I had in mind when reading Streetlight's OP and succeeding filling-in on this thread).
That said, I really like threads like this because there's truly a great effort made (on the part of Streetlight) in bringing out issues that require understanding of nuances.
Here's my objection to the prevailing sentiment within this thread:
Quoting Streetlight
I am challenging the bolded sections of the passage above because these are simply not what define capitalism. Rather, they occur despite capitalism. So, my confusion is brought about by these two features that were already present in other economic systems that are not capitalism.
So what are these other economic systems that somewhat resemble capitalism except in the most crucial, essential way? The socialist economic system and planned economy or centrally planned economy or command economy, among others. Mode of production and impersonal markets are features of these economies, too. Except that there is a central authority that makes the decisions as to the production and distribution of goods. So, the shift in decision-making and control are what distinguish these non-capitalist economies from capitalism. Put another way, all economies have the generalized impersonal markets and production for market. So the truly distinguishing features aren't those, but who has control and decision-making over production and distribution of all goods and services. (There's a lot to unpack here, but I hope this vague description drives the point).
Quoting Xtrix
Thank god I wasn't thinking of Marxism. And I don't know if this is even relevant to say, but I took economics in graduate level and political economic system in the undergraduate level, so I'm pretty sure my confusion did not come from that.
This distinction is meaningless and pretends economic activity consist of an atomic structure instead of a web that influences and affects everything around it. There's no capitalism in the first because George can also buy a car in North Korea and there's no capitalism in the second because that's just an example of speculation, which people did well before the rise of capitalism.
Then your earlier example of financialisation misses the point. Only a profit driven system will create increasing financial abstractions to increase market efficiency (and therefore profit) without creating anything of added value - eg. only wealth but no welfare is "created" or as anti-capitalists will point out "extracted" from, at least, the real economy if not just labour. So we have complex derivatives like the"ever-rolling snowball" (until it doesn't roll) and MBS but also high speed traders that really don't add anything but a fraction of a basispoint off your mortgage but a fraction of a few billion in mortgages adds up to a tidy profit. However, it's not a service consumers need or indeed makes their lives any better because increased complexity is married to a minimum of risk controls (cost cutting) and balance sheets aimed at business continuity (dividend payments instead of buffers).
It won't be profit over everything sure. For those part of that specific corporation. But they will continue to externalise costs where they can and there's also the nimby-principle. Don't get me wrong, I think stakeholder capitalism is already an improvement but I don't think it's enough. An additional step I would include is a dynamic equity system. That way every employee becomes a capitalist.
This suggests shares trading affects investment but that's not how it works. Share trading doesn't result in investment, that already happened when the shares were issued. Reduced profit expectations will lead to some sell off leading to a lower share price and therefore a lower market capitalisation.
Capitalism does not succeed in creating impersonal markets, The personal relations are just disguised, so as not to appear as part of the actual market. Consider advertising for example, it's nothing but a personal appeal. This we call marketing.
The closest capitalism gets to an impersonal market is the stock market. But here the only goods being exchanged is the capital itself, being marketed for a return on investment. The appeal is the appeal of easy-money which requires no advertising.
It appears like the only way to escape personal relations in the market is to market something which is not a true "good" in the first place, easy-money. Or is it the case that goods which require marketing are not true goods, because they won't sell without advertising, and the only true good is the one which everyone desires (easy-money) without the need for advertising?
So, starting from the top (i.m blanking on who started this thread), here's a question. Where is the capital in this definition of capitalism? By capital, I mean resources or money which are employed in order to purchase the materials for the production of commodities (raw materials, tools) and labour, commodities being items being produced to be sold on the market at a profit (hopefully, for the seller). This doesn't seem to be in the definition above, but if we don't have this, we can't distinguish between capitalism, and some kind of society where everyone is self-employed.
This is what we get in Marx, and other classical economists. Now I don't want to say other economists aren't available, but this is what I'm most familiar with at least.
We need to get the basics right before going off into what kind of effects these economies have on people, where they come from historically, and so on.
Also - command economies aren't market economies. There is a whole - very famous - economic debate about whether central planning can compete with the market in terms of information distributions between the producers, with Friedrich Hayek, Von Mises etc. on one side, and Oskar Lange and others on the other. Check out the wikipedia entry on "Economic Calculation Problem"
I don't want to bicker on the details of how things work; it's not a field I deem myself to be sufficiently knowledgeable about.
But I am curious to know if you disagree with the overall conclusion that current markets by and large select for short-sighted / short-term interests at the expense of long-sighted / long-term interests.
The gas prices of tomorrow verses the global economic insecurity of global warming as one, granted simplistic, example.
For purposes of expediency, let's stick to the description below that Streetlight provided, see quote below. I'm cool with it. So, if that is so, then capitalism and other economic systems do necessarily form impersonal markets. Not to be confused with market economy whose umbilical cord is tied to capitalism. As you can see, the latter is a special term given to describe what happens in capitalism.
Quoting Streetlight
Quoting RolandTyme
I don't know if you're directing this to my post. But my response to this is, at the moment I can't entertain inchoate comments as this thread has too many important points and already several pages long.
Two things. First, and least important - it is a mistake to conflate command economies with 'socialist economic systems'. This is a caricature, one often pushed by Americans for whom state control counts as the antithesis of capitalism. It is not. But this is a minor point. In any case capitalist economies are shot through from top to bottom with 'planning', albeit planning for the sake of profits, rather than anything else.
Second and far more important: a command economy is the opposite of impersonal exchange: it thoroughly personalizes (or rather, socializes) a market such that exchange in a command economy are precisely not spot exchanges. Market 'control' by a central state means precisely that such markets are anything but impersonal, and that exchanges under such conditions are embedded in social and political relations which dictate them from without. So it is wrong to say, as you have, that impersonal markets are features of command economies. I don't say this in any kind of defence of command economies. But it does point to a misunderstanding of either impersonal exchange, or command economies on your part.
Capital is precisely what orients production towards the market: it is that which takes control of production. As I said in a further post in this thread:
Or, since you asked for a reference:
[quote=Anievas and Nisancioglu, How The West Came To Rule]"We suggest a useful distinction can be made between capital as a ‘simple’ transmodal social relation and the historically specific capitalist mode of production. Or put more simply, a distinction must be made between ‘capital’ and ‘capitalism’. While capital – as we have seen – refers to a social relation defined by the relation between capital and wage-labour, capitalism refers to a broader configuration (or totality) of social relations oriented around the systematic reproduction of the capital relation, but irreducible – either historically or logically – to the capital relation itself.
...These broader relations of power oriented around the systematic reproduction of the capital relation enable us to distinguish between ‘antediluvian forms’ of capital from the historically specific epoch of capitalism. In antediluvian forms, the capital relation was reproduced within a broader configuration of relations that pertained to non-capitalist modes of production. As such, antediluvian capital was subordinated to the non-capitalist social relations within which it existed, and could not posit itself as the condition of its own reproduction: that is, as self-valorising capital."[/quote]
Obviously, advertising qualifies as a pre-existing relation, so that the exchange cannot be called an impersonal exchange. The type of relation which advertising is, needs to be further expounded to draw out the affect which it has on the exchange.
This account of the birth of capitalism is significantly influenced by structuralist or classical liberal lines of thought: the market is an impersonal sphere of exchange, organized and regulated by a rationally constructed structure of norms and rules; there is a movement from chaotic and haphazard world to the managed and predictable system, and the progressive improvement aims to satisfy human needs more effectively and efficiently. Yet, the widespread image of how the market works is related to what Marx called commodity fetishism. Far from being the site of equilibrium and rationality, the capitalistic market and production are founded on excess, waste, transgression, and limitless expansion. Disguised by impersonal and beneficial exchange, there is a system of disequilibrium and anti-productive forces. "What is produced today is not produced for its use-value or its possible durability, but rather with an eye to its death, and the increase in the speed with which that death comes about is equalled only by the speed of price rises. This alone would be sufficient to throw into question the `rationalistic' postulates of the whole of economic science on exchange, utility, needs, etc. Now, we know that the order of production only survives by paying the price of this extermination, this perpetual calculated `suicide' of the mass of objects. This operation is based on technological `sabotage' or organized obsolescence under cover of fashion or innovation." (Jean Baudrillard, 'The consumer society')
Quoting Streetlight
Before producing goods and commodities, there has been the production of the personal sphere itself. In parallel to the continuous process of decoding, destroying, and reconstructing archaic social, institutional, economic, and individual norms and relations, there has been the ongoing activity of producing economically effective consumers and subjects of interest.
The inmost dimensions of individual existence are linked to the market environment
and the economic field of life. Therefore, like founding the market, capitalism produces an individual’s self-relation to its determinant quasi-chaotic conditions.
None of what I said implies any of this, or at least, anything you wrote after "impersonal sphere of exchange".
No. Advertising to the public does not create a legal or binding relation with the audience. You could ignore advertising. I think it's clear from the definition here that those relations that would create personal relations are ones that are binding -- financial obligations, for example, as in loans or extension of credit.
Quoting Streetlight
I did not. My use of "or" means that you could take any one of those listed to use as example. I hope we are clear on this-- command economy is not the same as socialist economy.
Quoting Streetlight
Then you are changing your definition of impersonal exchange, which is against the rules of argumentation. Again, an impersonal exchange exists in command economy. The target buyers do not have to have binding relations with the authority in order to purchase, nor a personal relations must exist in order to make the purchase. I think we need to revisit the definition of command economy. Just because a government controls capitals and production, it doesn't mean that the public must all be bound one way or another.
I don't want to bicker either. It was just what I hoped to be a helpful clarification.
Quoting javra
I'm not sure this is particular to current markets. All market transactions, even before capitalism, aim at that short term goal: profit.
What we see that in the pursuit of profit new ways of generating profit are "invented". Day trading, high frequency trading, various ways that increased risk (leveraging) etc.
I think this comes from there not really being more demand in the real economy for actual investment and resulting growth but shareholders expect financial institutions to continue to perform and preferably better than last year. So I think there's just more of it rather than that we've become more shortsighted than in the past.
Who said the relation must be "legal or binding"? Most relations are not, especially personal relations. By using these terms, you are trying to make the personal relation into something impersonal. Then you say the relationship which advertising seeks to establish is not such an impersonal relation, such as a legal obligation. It makes no sense for you to take that tact, to limit "relations" to impersonal relations, then say that a lack of such impersonal relations constitutes an impersonal market.
Quoting L'éléphant
I think this is a clear misunderstanding. "Relations" includes family, friends, or any other emotional attachment. Advertising very clearly, often seeks to establish emotional attachment. Therefore the person entering the market seeking to purchase the advertised good, has a prior, "personal" relation to the seller.
Thanks. :smile:
Quoting Benkei
To my mind, there is such a thing as the delayed gratification of profiting more from long-term investments. Which requires more forethought. Short-term investments do not require the long-term sustainability of the business, or even of the business model for that matter. It's what populates the world with pyramid schemes - be these hidden or out in the open.
Then again, to me, an economic model axiomatically founded on infinite growth and resources which unfolds in a finite world is, simplistically addressed, itself a large scale kind of pyramid scheme.
I don't know enough about the subject to explore the nuances of how things have changed over the span of decades and centuries, but I do find this to be the current state of affairs. And, in so being, to be detrimental to our long-term benefit.
Hence my opinion that forethought, such as in the form of long-sighted interests in regard to profit, is not something which is selected for via optimal profits in our - at least - currently held, global economy.
As I initially commented, I'm all for a meritocratic economy of competition, but am opposed to the current, by now almost ingrained, outcome of those who are greedy being most deserving of the greatest profits (and along with these, of greatest financial power over others). Again, though - other than the vague, sophomoric, and overly idealistic notion of "raising human consciousness" or some such - I don't know how this problem could be corrected via the implementation of a different economic model in a democratic system.
Couldn’t feudal arrangements then be counted as a form of employment between lord and vassal? This relationship was a kind of contract too.
Like I said, this is a matter of definition. Perhaps it's all just a matter of scale, in the end. I think the word predominant there is important. Once that relationship rises to the degree that it does -- to the point where it's central to the socioeconomic system -- then we can call it a new system. It's no longer feudalism, even if feudal relationships still exist.
Quoting Streetlight
As you rightly point out in the title of this thread, markets aren't capitalism and in fact pre-date capitalism. It's market-dependence that you highlight. But market-dependence follows from the existence of markets in the first place. Yet this fact doesn't negate your point that there's something sui generis about the emergence of this dependence.
I think I'm making a similar point about the employer/employee relationship that emerged. True, dispossession of the means of production comes first -- as does the idea of property, ownership, profit, etc. -- but the fact that it is a necessary condition doesn't make it a sufficient condition to define capitalism by. (After all, we can imagine a worker-owned company being market-dependent too.) I would only say that I think it's imprecise to say an enterprise is still a capitalist one without the capitalists.
As with forms of government, I think the classification comes down to who has the power -- viz., who gets to make the decisions in a state or in an economy. In the case of the latter, the current world economy is dominated by the corporations. Corporations are controlled by their owners, and are governed undemocratically, as essentially an oligarchy. The owners are capitalists. Let's get rid of the capitalists. No capitalists, no capitalism.
No doubt there will still be the question of production, markets, profit-making, private property, and so on. But that's another discussion, in my view.
Quoting Streetlight
Agreed.
Quoting Streetlight
Quoting Streetlight
I'm in favor of all of the above, wholeheartedly. So regardless of how we define matters, we can agree on the goals. Any steps leading towards these ends would be beneficial, no matter how we taxonomize things.
Quoting Isaac
Sure. Worker ownership is just one logical step towards a more inclusive system. There should be community involvement on every level, ultimately.
I try to avoid "stakeholder" because of the recent rise of "stakeholder capitalism," endorsed by the Chamber of Commerce and Business Roundtable. But your point is taken.
Quoting Isaac
Sure, but removing private property is not necessary to eliminate capitalism, in my view. It certainly would, but there are other ways you can do so as well. If workers own a business, that's a form of private property too. But that takes away the power dynamic central to corporate governance that (again, in my mind) basically defines capitalism. From workers you can go to a community, like a town. One can go to town hall meetings across the United States and give input/talk to representatives, etc. No reason this cannot extend to things like utilities (and often do) or supermarkets or drugstores or factories. There are all kinds of ways to organize business -- I'm not even particularly knowledgeable about it, but it happens.
Quoting Isaac
For the reasons above. I think of it much like a form of government. Easier to get to, say, direct democracy from a republican form of government than it would be from an absolute monarchy. Right now the economy, as a system, is governed as a plutocracy. If we chip away at that by giving workers control, while we're not eliminating private property, we can see that it's not as big a jump to make towards a system run by the community as a whole.
The fact that you weren't thinking of it was my point, really.
Quoting L'éléphant
What does "that" refer to? Not reading Marx?
I would say this comment isn't relevant though, yes. You could have a Ph.D. in economics and not been assigned a word of the critics of capitalism. If anything an education in this matter, on average, would make it harder to understand this thread.
Quoting Benkei
I'm not really talking about stakeholder capitalism though.
I don't think I'd say I'd want to make every employee a capitalist either, really. But that's a tricky one. I think I wouldn't want to because the worker, by owning the factory he works in, has now taken control over his workplace. The capitalist is simply the owner/employer who doesn't have to set foot in the factory.
I'm afraid it's not clear to me then what you're proposing. Could you expound on it? Thanks.
Sure. I’m only proposing democratizing the workplace. Two points on this:
1) I eschew “stakeholder capitalism” because of the connotations, as mentioned above to Isaac.
2) more importantly, I don’t consider worker ownership or community ownership to be a form of capitalism. While it will still involve private property, profit, and markets— it will be run democratically, rather than oligarchically (which is our current business governance model).
If by stakeholder capitalism you mean democracy at work, the entire community being involved in business, etc., that’s fine — then it’s just a matter of usage and personal preference. I’m thinking this is probably the case based on what you’ve written in the past.
Could you tell me why that is surprising to you? Why should I be thinking about marxism in this thread? It's not an economic system, just so you know.
Quoting Xtrix
Why would this be?
It’s not surprising. That’s my point.
I brought up Marx because he is a well known observer of capitalism, which is what this thread is about. You said you were struggling with understanding this thread. I think one reason could be that you’re unfamiliar with certain analyses of capitalism which much of this thread takes for granted.
Frankly I’m not interested in discussing this further. If it doesn’t apply to you, fair enough. I don’t care.
I discovered that I was struggling understanding this thread because of Streetlight's incorrect attribution of what makes capitalism a capitalism. And I'm not wavering from it. I made my point and if you disagree with it, then I agree that you disagree.
So what if marx is a well known observer of capitalism? You eschew someone who studied or has a phd in economics. Yet you bring up marx here. Make up your mind for the sake of honesty, and not just to win on this thread.
I have no idea what you’re talking about at this point. I’m not asking you to waver in anything, nor did I follow your conversation with Streetlight, nor am I avoiding anyone with a Ph.D. You’re the one who seems to want to argue what was initially a complimentary response. I was brainstorming possible reasons for the “lack of understanding of capitalism.” My mistake for assuming you were sincere, I guess.
In case you’ve forgotten:
Quoting Xtrix
Odd that you want to pick a fight with me for no reason.
I would say the class relation is the defining feature of capitalism, but that the classes are bourgeoisie/proletariat and specifically *not* employer/worker. Not everyone is a member of the proletariat that is an employee. The proletariat are thems who are paid just enough to live and make sure their kids live long enough to become workers themselves and start the process all over again. If you have more than that then even if you have nothing to sell but your labor you're a worker -- but not a proletarian.
This isn't to fetishize the proletariat either, like it's a noble place to be. It's a terrible place to be. It's the end-point for most everyone in capitalism. And, most importantly -- this is where I'd draw the distinction especially, and not just on definitional grounds -- it's global.
The problem with co-ops and worker owned places in the United States is that capitalism is a global phenomena, and no matter how well-meaning an individual firm may be the rules are harder than our intents. Even together, we are just a small group in a large international system. You can, as everyone tries to, make moderate improvements. But an undermining of capital it is not only because the global system of private ownership over the workplace, and the bourgeoisie, and the proletariat remains.
I reread capital recently, and I've nixed my original project, but something that really struck me on this reading was how the scope of political economy is often missed in these conversation. Like, especially because we're talking about classical economic theory, right? So "The Wealth of Nations" pretty much covers the topic de jure - it's right in the title! :D But it's not markets and firms that are the units of analysis -- it's the state, and how wealth is generated by state-level actors. (like classes, for instance ;) )
Quoting Moliere
The proletariat are wage-laborers. I'm not sure why you're restricting the usage to those who are "paid enough to live and make sure their kids live long enough."
From CM, footnotes by Engels:
Emphasis mine.
A better argument might be what some call the managerial class, a class below the owners, being somewhat separate from your average worker despite also being an employee of the owner class. There's a case to be made for that, and I think Michael Albert has written about this. Otherwise I don't see much merit in your re-defining the terms.
All proletarians are wage-laborers, but not all wage-laborers are proletarians.
After all, the employees at Steam -- a sort of anarcho-capitalist company -- just aren't proletarians even if they don't own one stock in their business. Their business would collapse without the international system of trade which ensures metal is cheap.
Paul Krugman
Guy Standing
Joseph Stiglitz
Diedre McCloskey
Shoshana Duboff
Yanis Varoufakis
Mariana Mazzucato
Slavoj Žižek
I include anyone who makes a wage and isn’t an owner part of the proletariat. There can be gradations, but it’s on par with white and blue collar, upper middle and middle class, etc.
Wage-laborers are proletarians, and proletarians are wage-laborers. The abolition of capitalism is the abolition of the wage system in any capacity, so co-ops count as a sort of abolition-in-miniature.
I would assert that the current international economic system, at the scope of nations, relies upon exploitation, and there is a bottom class on this scale. On the top, it seems, we are in agreement -- the bourgeoisie.
Do you disagree with my characterization of that class? Or are we in agreement there?
On the bottom, so I'd say, there's the global south and the whole history of colonialism to account for -- material resources have been plundered the world over using the mechanisms of the economic system we live with now.
So abolish capitalism in miniature -- or even lets say at a certain scale? -- and there's still this past and current history of nations exploiting, externalizing the bottom-labor to other national markets to protect their own. This exploitation will continue to exist, and that's the one I care about.
Utopia in miniature is a step toward larger scale change. Focus on the world around you. Engage it with your vision in mind. Allow the bigger world to unfold according to its own inner logic. Know you're making a difference by starting small.