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Contextual Quotes


"The drive of capitalism is that of an auto-reproduction toward its perpetuation. Capitalism is thus interminable. No matter how futile and harmful it is, it does not end. Even if our thought changes, or the state regulates it, it does not end. Capitalism is not a product of our desire, but our desire is the product of capitalism. Notwithstanding this power, however, if and only if it fails to capture surplus value, it will die out. ... (We) won’t ‘overthrow’ capitalism; it will just make it die out quietly."

- Kojin Karatani: (NAM program)


"The clue to the nature of capitalism is in the name – capitalism is about making the biggest possible return on capital investment, and it’s about making this fundamental to the whole organization of society. Sometimes capitalism involves selling things in markets in pursuit of that larger aim, but often the major energies lie elsewhere. The best short definition of capitalism along these lines I’ve come across is from Wolfgang Streeck: a capitalist society is one that “secures its collective reproduction as an unintended side-effect of individually rational, competitive profit maximization in pursuit of capital accumulation”.

- Chris Smaje [1]


"Present-day capitalists own not ‘means of production,’ but a financial claim on corporate earnings. This fact is true for all capitalists, whether they own an automobile company, a software firm, a bank, a media conglomerate or a diversified financial portfolio. In this sense, we can no longer differentiate between ‘industrial,’ ‘commercial’ and ‘financial’ capitalists."

- Shimshon Bichler and Jonathan Nitzan [2]

Markets do not equal capitalism

"To reprise the title of this post, how capitalism started and why it still matters are important themes I discuss within those twenty pages. Maybe it’s necessary to define capitalism before discussing how it originated, but let me begin by defining what it isn’t. If I grow a crop or make a widget, take it to a market and sell it for money to someone who wants it, that doesn’t inherently make me a capitalist. In fact, capitalism isn’t particularly about markets or selling things. This needs stressing over and over, because powerful narratives to the contrary repeatedly fool us into supposing otherwise. The clue to the nature of capitalism is in the name – capitalism is about making the biggest possible return on capital investment, and it’s about making this fundamental to the whole organization of society. Sometimes capitalism involves selling things in markets in pursuit of that larger aim, but often the major energies lie elsewhere. The best short definition of capitalism along these lines I’ve come across is from Wolfgang Streeck: a capitalist society is one that “secures its collective reproduction as an unintended side-effect of individually rational, competitive profit maximization in pursuit of capital accumulation”

- Chris Smaje [3]

The Archaic/Spiritual Critique of Capitalism

"Capitalism is not something new, but is simply the logical conclusion of something old — capitalism is the total desacralization of property. Feudal property still retained something of the sacred character handed down from the earliest times, and where capitalism makes a qualitative break from it is in its total, or at least near-total abdication of this sacrality. Not all anti-capitalisms are created equal, but all are anti-capitalism, and that is the problem. In other words, anti-capitalisms cede frame to capitalism, standing in opposition to it. The archaic critique of capitalism, however, does something quite different—it frames capitalism as standing in opposition to itself. Sacral property is not the absence of capitalism; capitalism is the absence of sacral property—capitalism is the derivative term, and this has important ramifications. ... Above all, the archaic critique of capitalism lays bare the essential solution: resacralization."

- IP [4]


See also the authorative history of capitalism written by Jürgen Kocka (2016).


"At its root, capitalism is an economic system based on three things: wage labour (working for a wage), private ownership or control of the means of production (things like factories, machinery, farms, and offices), and production for exchange and profit.

While some people own means of production, or capital, most of us don't and so to survive we need to sell our ability to work in return for a wage, or else scrape by on benefits. This first group of people is the capitalist class or "bourgeoisie" in Marxist jargon, and the second group is the working class or "proletariat". See our introduction to class here for more information on class.

Capitalism is based on a simple process – money is invested to generate more money. When money functions like this, it functions as capital. For instance, when a company uses its profits to hire more staff or open new premises, and so make more profit, the money here is functioning as capital. As capital increases (or the economy expands), this is called 'capital accumulation', and it's the driving force of the economy.

Those accumulating capital do so better when they can shift costs onto others. If companies can cut costs by not protecting the environment, or by paying sweatshop wages, they will. So catastrophic climate change and widespread poverty are signs of the normal functioning of the system. Furthermore, for money to make more money, more and more things have to be exchangeable for money. Thus the tendency is for everything from everyday items to DNA sequences to carbon dioxide emissions – and, crucially, our ability to work - to become commodified.

And it is this last point - the commodification of our creative and productive capacities, our ability to work - which holds the secret to capital accumulation. Money does not turn into more money by magic, but by the work we do every day.

In a world where everything is for sale, we all need something to sell in order to buy the things we need. Those of us with nothing to sell except our ability to work have to sell this ability to those who own the factories, offices, etc. And of course, the things we produce at work aren't ours." (

2. Ian Wright:

"Contrary to conventional wisdom the defining characteristic of capitalism is not market exchange. Market relations have existed since classical times.

The essence of capitalism is a system of property relations, which I’ll call the “wage system”. Here, the capitalist firm hires-in labour at a pre-agreed rental price. The labour is mixed with other inputs and produces goods or services for sale in the market. Normally, firms sell at prices that exceed their costs of production, which includes the cost of used-up material inputs, rent, interest on capital loans, and labour costs etc.

Here, labour is just another ex ante cost of production. Any remaining revenue — the residual income — then gets distributed as profits to the owners of the firm."

What’s wrong with this?

Essentially, the wage system is a theft-based system of property relations. The mere legal ownership of a firm is sufficient to lay claim on its residual income. The owner of a capitalist firm can, as John Stuart Mill, put it: “grow richer, as it were in their sleep”. Yet this residual income is the fruit of others’ labour. Taking resources from others, without giving anything back in exchange, is theft. This is why Marxists label capitalism an exploitative economic system.

But wait. Isn’t profit a just reward for the risk of capital investment? Someone has to fund the firm. Surely owners deserve their returns too?

Actually, no. There’s a big difference between advancing capital to a firm, and owning the firm.

Let’s say you advance capital to a firm. You should expect repayment of your capital, plus a risk premium and collateral security, as a just exchange. But by lending capital you do not become an owner of the firm. Once your loan is repaid you have no further claims on the firm’s revenue.

This contract is based on the principle of exchange: in essence, it allows the loaner and loanee to exchange the time when they consume a set of resources. There’s no theft here.

But let’s say you want more. You advance capital to a firm, and in addition to the above, you expect joint ownership of the firm, i.e. equity capital. In this case you do become an owner of the firm. And so, once your initial loan and risk premium is repaid, you still retain a claim on the firm’s revenue. In fact you lay claim to the residual income, that is the fruits of others’ labour.

This contract is not based on the principle of exchange. You now get to take resources from others, solely in virtue of the paper claim of holding “equity”. You do not have to give anything to the firm in return for your claim. The contract bestows the right to take wealth produced by others by fiat. This is theft.

All ideological justifications of capitalism obscure this theft, and render it normal, almost entirely unnoticed, and socially acceptable. It’s largely an unquestioned and seemingly natural aspect of our economic relations.

Capitalist property relations are not merely unjust, however. They are also the hidden and root cause of the major social ills of our day, in particular those caused by extreme income and wealth inequality.

The capitalist firm minimises input costs, including wages, in order to maximise the residual income of the owners of the firm. This causes a two-class distribution of income and wealth, with a Pareto long tail of the super-rich. And it’s also the major cause of imperialism, which has a material foundation in the massive wealth disparities between countries. In consequence, capitalist property relations are also undesirable."


3. An updated definition for the 21st cy ? By Shimshon Bichler and Jonathan Nitzan:

"We start with capital. Contemporary students of capitalism, hamstrung by nineteenth-century biases, continue to think of accumulation in the ‘material’ terms of labor, production and consumption. In our opinion, this emphasis has become insufficient and misleading. Over the past century, capital has grown increasingly politicized in nature and financial in form. ‘Free competition’ and the formal separation of ‘state’ and ‘capital’ — where they existed — have given way to a far more complex interaction of ‘dominant capital’ groups and ‘big government.’ Accumulation, which during the nineteenth century was anchored largely in proletarianization and technical advances, has come to depend more and more on corporate amalgamation and inflationary pricing. "


For more about this approach, see the book: Capital as Power

4. John Roemer:

"Every socioeconomic formation, I propose, has a foundation consisting of three pillars: a set of property relations and institutions that organize the allocation of resources, a distributive ethic that specifies the allocation of income and resources considered fair or just, and a behavioral ethos that specifies how economic actors are expected to make decisions. These pillars are linked: if economic actors behave according to the stipulated ethos, then the property relations should implement the distributive ethic. The behavioral ethos of capitalism is individualism: each actor is conceived as being in competition with all other actors, and the actions of all are constrained by nature. This ethos may be summarized as “going it alone.” The key institutions are private property ownership, contracts, and markets. The distributive ethic is “from each according to his endowments of talents and wealth, to each what he can get.” Law sets the rules — what Karl Marx called the superstructure. Katharina Pistor’s 2019 book, The Code of Capital: How the Law Creates Wealth and Inequality, explains how law under capitalism creates the conditions for capital accumulation."



Fred Magdoff:

Here are ten key aspects of capitalism:

  1. It has to grow (or else it is in crisis) and its very logic and motivating force impels growth.
  2. It has no other driving force than the accumulation of ever greater amounts of capital.
  3. Through the creation of so-called “externalities” (or side effects) it wreaks damage on humans as well as the ecosystem and the life support systems needed by humanity and other species. In Paul Sweezy’s words: “As far as the natural environment is concerned, capitalism perceives it not as something to be cherished and enjoyed but as a means to the paramount ends of profit-making and still more capital accumulation.”
  4. It promotes the use of nonrenewable resources without regard to the needs of future generations, as if there was no end to them, and abuses even renewable resources such as ocean fisheries and forests.
  5. It creates vast inequality in income, wealth, and power both within and between countries. Not only class, but race, gender, and other inequalities are built into its laws of motion.
  6. It requires and produces a reserve army of labor—people precariously connected to the economy, most kept in poverty or near poverty—so that labor is available during economic upswings and workers can easily be fired when not needed by businesses.
  7. It promotes national economic and political competition and imperialism, leading to wars for domination and access to resources.
  8. It fosters and rewards those particular human traits that are useful for thriving or even just existing in such a possessive-individualist society—selfishness, individualism, competition, greed, exploitation of others, consumerism—while not allowing the full expression of those human characteristics needed for a harmonious society (cooperation, sharing, empathy, and altruism).
  9. It leads to the breakdown of human health since people operate in a hierarchical society, with many working under dangerous and physically debilitating conditions or in jobs that are repetitive and boring—while subject to job loss or fear of losing their job. (There are many adverse long-term health effects following the loss of one’s job.)
  10. It leads to the breakdown of healthy communities as people become more solitary in outlook and behavior and indigenous culture is replaced by the dominant national or international capitalist culture and outlook. People become dedicated to obtaining more for themselves and their families and depending less on reciprocal relationships with others."


Inherent Growth Characteristics of Capitalism

Richard Smith:

"1. Producers are dependent upon the market: Capitalism is a mode of production in which specialized producers (corporations, companies, manufacturers, individual \producers) produce some commodity for market but do not produce their own means of subsistence. Workers own no means of production, or insufficient means to enter into production on their own, and so have no choice but to sell their labor to the capitalists. Capitalists as a class possess a monopoly ownership of most of society’s means of production but do not directly produce their own means of subsistence. So capitalists have to sell their commodities on the market to obtain money to obtain their own means of subsistence and to purchase new means of production and hire more labor, to re-enter production and carry on from year to year. So in a capitalist economy, everyone is dependent upon the market, compelled to sell in order to buy, to buy in order to sell to re-enter production and carry on.

2. Competition is the motor of economic development: When producers come to market they’re not free to sell their particular commodity at whatever price they wish because they find other producers selling the same commodity. They therefore have to “meet or beat” the competition to sell their product and stay in business. Competition thus forces producers to reinvest much of their profit back into productivity-enhancing technologies and processes (instead of spending it on conspicuous consumption or warfare without developing the forces of production as ruling classes did for example under feudalism): Producers must constantly strive to increase the efficiency of their units of production by cutting the cost of inputs, seeking cheaper sources of raw materials and labor, by bringing in more advanced labor-saving machinery and technology to boost productivity, or by increasing their scale of production to take advantage of economies of scale, and in other ways, to develop the forces of production.

3. “Grow or die” is a law of survival in the marketplace: In the capitalist mode of production, most producers (there are some exceptions, which I will note below) have no choice but to live by the capitalist maxim “grow or die.” First, as Adam Smith noted, the ever-increasing division of labor raises productivity and output, compelling producers to find more markets for this growing output. Secondly, competition compels producers to seek to expand their market share, to defend their position against competitors. Bigger is safer because, ceteris paribus, bigger producers can take advantage of economies of scale and can use their greater resources to invest in technological development, so can more effectively dominate markets. Marginal competitors tend to be crushed or bought out by larger firms (Chrysler, Volvo, etc.). Thirdly, the modern corporate form of ownership adds irresistible and unrelenting pressures to grow from owners (shareholders). Corporate CEOs do not have the freedom to choose not to grow or to subordinate profit-making to ecological concerns because they don’t own their firms even if they own substantial shares. Corporations are owned by masses of shareholders. And the shareholders are not looking for “stasis”; they are looking to maximize portfolio gains, so they drive their CEOs forward.

In short, I maintain that the growth imperative is virtually a law of nature built-into in any conceivable capitalism. Corporations have no choice but to seek to grow. It is not “subjective.” It is not just an “obsession” or a “spell.” And it cannot be exorcised. Further, I maintain that these theses are uncontroversial, even completely obvious to mainstream economists across the ideological spectrum from Milton Friedman to Paul Krugman. But Herman Daly, Tim Jackson and the rest of the pro-market anti-growth school of ecological economists must deny these elementary capitalist rules for reproduction because their project for a “steady-state” eco-capitalism rests on the assumption that capitalist economic fundamentals are not immutable, that growth is “optional,” and thus dispensable." (

Source: Critique of Steady-State Capitalism. Richard Smith

Characteristics of Capitalism according to Freemarket Anticapitalism

Charles Johnson:

"The term “capitalism” is used by almost all sides in economic debates as if it were obviously the ideal governing libertarian policy proposals, and is debated over both by nominal pro-”capitalists” and by nominal anti-”capitalists” as if it were perfectly obvious to everyone what it means.

But really the term has a lot of different shades of meaning, which are distinct from each other, and some of which are even mutually exclusive.1 And as often as not it seems that debates about “capitalism” involve more than one of them being employed — sometimes because each person is talking about a different thing when she says “capitalism,” but they think that they are fighting about a common subject. And sometimes because one person will make use of the word “capitalism” in two or more different senses from one argumentative move to the next, without noticing the equivocation. At the expense of oversimplifying a very large and tangled literature,2 there are at least four major definitions that have been attached to the term:

Free Enterprise

This is a relatively new usage (coming mainly from libertarian writing in the 1920s-1940s). “Capitalism” has been used by its defenders just to mean a free market or free enterprise system, i.e., an economic order — any economic order — that emerges from voluntary exchanges of property and labor without government intervention (or any other form of systemic coercion). This is the meaning that is almost surely most familiar to those who spend much time reading libertarian economic writing; it is offered as, more or less, a stipulative definition of the term in Friedman, Mises, et al.

Pro-Business Political Economy

“Capitalism” has also been used, sometimes by its opponents, and sometimes by beneficiaries of the system, to mean a corporatist or pro-business economic policy — that is, to active government support for big businesses through instruments such as government-granted monopolies, subsidies, central banking, tax-funded infrastructure, “development” grants and loans, Kelo-style for-profit eminent domain, bail-outs, etc. Thus, when a progressive like Naomi Klein describes government-hired mercenaries, paramilitary torture squads or multigovernment financial institutions like the IMF and World Bank, as examples of the political economy of “disaster capitalism,” capitalism here must mean something other than markets left free of major government intervention. Rather, this is the state intervening, with a very heavy hand, to promote the interests of a particular class of economic players, or promoting a particular form of economic activity, as a matter of policy. This second meaning of capitalism is, of course, mutually exclusive with the first meaning — state-driven corporatism necessarily consists of projects funded by expropriated tax dollars, or regulations enforced from the barrel of a gun, and so to be a “capitalist” in the sense of a free marketeer means being an “anti-capitalist” in the sense of opposing the corporate state, and being “pro-capitalist” in the sense of state “growth” policy means coming out against “capitalism” in the sense of genuinely free markets.

The Wage-Labor System

“Capitalism” has also been used to refer to a specific form of labor market, or a distinctive pattern of conditions facing ordinary working people — one in which the predominant form of economic activity is the production of goods or the performance of services in workplaces that are owned and managed, not by the people doing the work on the line, but by an outside boss. In this third sense, you have capitalism when most workers are working for someone else, in return for a wage, because access to most of the important factors of production is mediated through a business class, with the businessmen and not the workers holding legal titles to the business, the tools and facilities that make the shop run, and the residual profits that accrue to the business. Workplaces are, as a result, typically organized in hierarchical fashion, with a boss exercising a great deal of discretion over employees, who are generally much more dependent on keeping the job than the boss is on keeping any one worker. (This sense is most commonly seen in Marxian writing, and in older writing from the radical Left — including a great deal of pro-market writing from Anarchists such as Benjamin Tucker and Pierre-Joseph Proudhon.)

Profit-Dominated Society

Finally, the term “capitalism” is very often used (outside of the debating circles of libertarian economists, this is in fact probably the modal use of the term) loosely to mean something like the commercialization of everyday life — that is, a condition in which social interactions are very largely mediated through, or reshaped by, overtly commercial motives, and most or all important social and economic institutions are run primarily on a businesslike, for-profit basis.

It’s important to note, then, that while “capitalism” in the first two senses — that of the freed market, and that of pro-business politics — are mutually exclusive, “capitalism” in the latter two senses are conceptually independent of the political oppositions involved in the first two senses of the term. In concept, a fully free labor market might develop in any number of directions while remaining a free market — you might have a market dominated by big corporations and traditional employer-employee relationships; or you might have worker co-ops, or community workers’ councils, or a diffuse network of shopkeeps and independent contractors; or you might have a pluralistic mish-mash of all these arrangements, without any one of them clearly dominating. (The most likely outcome will depend in part on pre-existing patterns of ownership, the strength and direction of people’s preferences, the direction of entrepreneurial innovation, etc. etc.) Similarly, interventionist states might intervene either against, or in favor of, “capitalism” in the latter two senses — when states adopt heavy-handed “growth” policies and prop up corporate enterprise, they are attacking the free market, but they may very well be entrenching or expanding workplace hierarchy, concentrations of economic ownership, or commercial motives and activities, at the expense of other patterns of ownership, or other forms of peaceful activity, that might be more common were it not for the intervention.

I point all this out, not because I intend to spend a lot of time on semantic bickering about the Real Meaning of the term “capitalism,” or because I think that (say) the disagreements between libertarians and progressives can all be cleared away by showing that one of them is using “capitalism” in the first sense, while the other is really using “capitalism” in the second, third or fourth. Rather, I think the distinction is worth making precisely in order to avoid semantic bickering, and thus to get clear on where the areas of substantive disagreement, and the best topics for productive argument, actually are. A lot of time to get to the real argument you first need to be willing to say, “OK, well, I see that you are complaining about ‘capitalism’ in the sense of the corporate status quo, but that’s not what I mean to defend. What I’m defending is the free market, which is actually radically different from the status quo; no doubt you disagree with that too, but for different reasons; so let’s get on with that.”

Capitalism as a system of generalized monopolies

Samir Amin:

"Contemporary capitalism is a capitalism of generalized monopolies. By this I mean that monopolies are now no longer islands (albeit important) in a sea of other still relatively autonomous companies, but are an integrated system. Therefore, these monopolies now tightly control all the systems of production. Small and medium enterprises, and even the large corporations that are not strictly speaking oligopolies are locked in a network of control put in place by the monopolies. Their degree of autonomy has shrunk to the point that they are nothing more than subcontractors of the monopolies.

This system of generalized monopolies is the product of a new phase of centralization of capital in the countries of the Triad (the United States, Western and Central Europe, and Japan) that took place during the 1980s and 1990s.

The generalized monopolies now dominate the world economy. 'Globalization' is the name they have given to the set of demands by which they exert their control over the productive systems of the periphery of global capitalism (the world beyond the partners of the triad). It is nothing other than a new stage of imperialism.

  • 2.* The capitalism of generalized and globalized monopolies is a system that guarantees these monopolies a monopoly rent levied on the mass of surplus value (transformed into profits) that capital extracts from the exploitation of labour. To the extent that these monopolies are operating in the peripheries of the global system, monopoly rent is imperialist rent. The process of capital accumulation -- that defines capitalism in all its successive historical forms -- is therefore driven by the maximization of monopoly/imperialist rent seeking.

This shift in the centre of gravity of the accumulation of capital is the source of the continuous concentration of income and wealth to the benefit of the monopolies, largely monopolized by the oligarchies ('plutocracies') that govern oligopolistic groups at the expense of the remuneration of labour and even the remuneration of non-monopolistic capital.

  • 3.* This imbalance in continued growth is itself, in turn, the source of the financialization of the economic system. By this I mean that a growing portion of the surplus cannot be invested in the expansion and deepening of systems of production and therefore the 'financial investment' of this excessive surplus becomes the only option for continued accumulation under the control of the monopolies.

The implementation of specific systems by capital permits the financialization to operate in different ways:

1. the subjugation of the management of firms to the principle of 'shareholder value'

2. the substitution of pension systems funded by capitalization (Pension Funds) by systems of pension distribution

3. the adoption of the principle of 'flexible exchange rates'

4. the abandonment of the principle of central banks determining the interest rate -- the price of 'liquidity' -- and the transfer of this responsibility to the 'market.'

Financialization has transferred the major responsibility for control of the reproduction of the system of accumulation to some 30 giant banks of the triad. What are euphemistically called 'markets' are nothing other than the places where the strategies of these actors who dominate the economic scene are deployed.

In turn this financialization, which is responsible for the growth of inequality in income distribution (and fortunes), generates the growing surplus on which it feeds. The 'financial investments' (or rather the investments in financial speculation) continue to grow at dizzying speeds, not commensurate with growth in GDP (which is therefore becoming largely fictitious) or with investment in real production.

The explosive growth of financial investment requires -- and fuels -- among other things debt in all its forms, especially sovereign debt. When the governments in power claim to be pursuing the goal of 'debt reduction,' they are deliberately lying. For the strategy of financialized monopolies requires the growth in debt (which they seek, rather than combat) as a way to absorb the surplus profit of monopolies. The austerity policies imposed 'to reduce debt' have indeed resulted (as intended) in increasing its volume.

  • 4.* It is this system -- commonly called 'neoliberal ,' the system of generalized monopoly capitalism, 'globalized' (imperialist) and financialized (of necessity for its own reproduction) -- that is imploding before our eyes. This system, apparently unable to overcome its growing internal contradictions, is doomed to continue its wild ride.

The 'crisis' of the system is due to its own 'success.' Indeed so far the strategy deployed by monopolies has always produced the desired results: 'austerity' plans and the so-called social (in fact anti-social) downsizing plans that are still being imposed, in spite of resistance and struggles. To this day the initiative remains in the hands of the monopolies ('the markets') and their political servants (the governments that submit to the demands of the so-called 'market').

  • 5.* Under these conditions monopoly capital has openly declared war on workers and peoples. This declaration is formulated in the sentence 'liberalism is not negotiable.' Monopoly capital will definitely continue its wild ride and not slow down. The criticism of 'regulation' that I make below is grounded in this fact."


A unbeatable combination of hierarchy and individualism ?

Francesco Boldizzoni:

"If the flaws that plague capitalism have not proved decisive for its demise, then should we conclude that its persistence is due to its virtues? The typical explanation of mainstream economics is that capitalism is sustained by its supposed efficiency, thanks to which it also tends to prevail over other systems. I don’t buy this “efficiency view” either. My thesis is that the reasons why capitalism persists have nothing to do with the quality of its fabric but are to be found in the social structure in which it is embedded and that two elements, combined, are involved in its reproduction: hierarchy and individualism.

All complex societies are to some extent hierarchical, but capitalist society has inherited from the feudal society out of which it grew some highly asymmetrical power relations. The same dependence created by need that used to bind serfs to their lords now binds food delivery riders to their billionaire exploiters. Capitalism replaced old hierarchies with new hierarchies. It brought about a new category, namely, class, that is still very central to our societies. While social distinctions in the old world reflected status at birth, in the new world they are based on the ability to accumulate money. In this sense, capital led to a reconfiguration of social stratification. Yet, the true element of novelty that accompanied the rise of capitalism, and the one that distinguishes it most, is individualism. People today feel motivated by their preferences, needs, and rights, rather than by the norms and duties that come from belonging to a community. They have relationships mediated by contracts and mainly resort to the market to meet their needs. Over time, this market logic and the underlying profit motive have become increasingly generalized, even extending to sensitive spheres of human life such as work and health care.

These hierarchical social structures and individualistic values have taken shape over many centuries and can’t suddenly disappear. If hierarchy has been with us for almost all time, individualism is intertwined with the particular form taken by modernization in this part of the world. In a way, it was the price to pay to be free from oppressive forms of social control and able to make decisions for oneself. Fortunately, however, not all Western societies are hierarchical and individualistic to the same degree, which explains the existence of more or less tolerable varieties of capitalism."

For the avoidance of doubt, I do not think that capitalism will go on forever. All social systems in human history have had a beginning and, after undergoing a slow yet relentless evolution, they are eventually turned into something else. There is no reason to believe that capitalism will be an exception. But it won’t die because of any internal contradictions nor just because we want it to. Moreover, if we try to imagine what kind of system could evolve from capitalism in a few centuries, we might not like it either. As Ralf Dahrendorf once observed, the oppressed of one epoch have never become the rulers of the next. Elites have always been superseded by competing elites. That’s why, I think, achieving greater social justice under capitalism should be the highest priority for progressives." (

Definitions of other 'ethical' visions of capitalism

Collated by Jeff Mowatt:

"Economics, and indeed human civilization, can only be measured and calibrated in terms of human beings. Everything in economics has to be adjusted for people, first, and abandoning the illusory numerical analyses that inevitably put numbers ahead of people, capitalism ahead of democracy, and degradation ahead of compassion." (From the Manifesto for People-Centered Economics)

The white paper for People-Centered Economic Development was delivered to the Committee to re-elect the (US) President in 1996 following an invitation made to P-CED founder Terry Hallman, to serve as an honorary member of the steering committee. P-CED was first deployed in Russia in 1999 to source the Tomsk Regional Initiative for USAID." (

  • Creative Capitalism - Bill Gates

"We are living in a phenomenal age. If we can spend the early decades of the 21st century finding approaches that meet the needs of the poor in ways that generate profits and recognition for business, we will have found a sustainable way to reduce poverty in the world. This task is open-ended. It can never be finished. But a passionate effort to answer this challenge will help change the world."

"Why is industrial era business so destructive - why does it slash and burn rainforests, endanger entire species, vaporize culture and community, marginalize the poor and disadvantaged, and erode our health and vitality?

"Because none of those have value in an industrial economy: none are capitalized. So the beancounters of the world are free to plunder and ruin them - because, economically, they actually don't exist.

"20th century capitalism, in other words, marginally valued pure financial capital too highly, while marginally valuing human, natural, social, and cultural capital at zero - or, at the limit, negatively." (



"Capitalism is presented as a 'natural' system, formed a bit like mountains or land masses by forces beyond human control, that it is an economic system ultimately resulting from human nature. However it was not established by 'natural forces' but by intense and massive violence across the globe. First in the 'advanced' countries, enclosures drove self-sufficient peasants from communal land into the cities to work in factories. Any resistance was crushed. People who resisted the imposition of wage labour were subjected to vagabond laws and imprisonment, torture, deportation or execution. In England under the reign of Henry VIII alone 72,000 people were executed for vagabondage.

Later capitalism was spread by invasion and conquest by Western imperialist powers around the globe. Whole civilisations were brutally destroyed with communities driven from their land into waged work. The only countries that avoided conquest were those - like Japan - which adopted capitalism on their own in order to compete with the other imperial powers. Everywhere capitalism developed, peasants and early workers resisted, but were eventually overcome by mass terror and violence.

Capitalism did not arise by a set of natural laws which stem from human nature: it was spread by the organised violence of the elite. The concept of private property of land and means of production might seem now like the natural state of things, however we should remember it is a man-made concept enforced by conquest. Similarly, the existence of a class of people with nothing to sell but their labour power is not something which has always been the case - common land shared by all was seized by force, and the dispossessed forced to work for a wage under the threat of starvation or even execution.

As capital expanded, it created a global working class consisting of the majority of the world's population whom it exploits but also depends on." (

Contextual Citation

Henri Pirenne:

"I have observed, in surveying this history from the beginning of the Middle Ages to our own times, a very interesting phenomenon to which, so it seems to me, attention has not yet been sufficiently called. I believe that, for each period into which our economic history may be divided, there is a distinct and separate class of capitalists. In other words, the group of capitalists of a given epoch does not spring from the capitalist group of the preceding epoch. At every change in economic organization we find a breach of continuity. It is as if the capitalists who have up to that time been active, recognize that they are incapable of adapting, themselves to conditions which are evoked by needs hitherto unknown and which call for methods hitherto unemployed. They withdraw from the struggle and become an aristocracy, which if it again plays a part in the course of affairs, does so in a passive manner only, assuming the rôle of silent partners. In their place arise new men, courageous and enterprising, who boldly permit themselves to be driven by the wind actually blowing and who know how to trim their sails to take advantage of it, until the day comes when, its direction changing and disconcerting their manoeuvres, they in their turn pause and are distanced by new craft having fresh forces and new directions. In short, the permanence throughout the centuries of a capitalist class, the result of a continuous development and changing itself to suit changing circumstances, is not to be affirmed. On the contrary, there are as many classes of capitalists as there are epochs in economic history. That history does not present itself to the eye of the observer under the guise of an inclined plane; it resembles rather a staircase, every step of which rises abruptly above that which precedes it. We do not find ourselves in the presence of a gentle and regular ascent, but of a series of lifts." (


The Brenner Hypothesis

Chris Smaje:

" In an influential article first published in 1976, historian Robert Brenner argued that it started in England – nowhere else – in the late 15th century, when large-scale rural landowners established competitive tenancies for relatively wealthy peasant farmers, incentivizing them to increase the profits and productivity of their farming. This, Brenner argued, was the result of a longer-term class conflict emerging from medieval contests between landlords and peasants that took the unique turn in England of an only partial victory to the peasants. In Eastern Europe, by contrast, the victory went to the landlords, whereas in France it went to the peasants, establishing different kinds of agrarian society that were only upended in later revolutions. But in England, says Brenner, and only in England, the stalemate between landlords and peasants produced – quite unintendedly on their part – a monetized, accumulative and self-transforming rural capitalist society.

Brenner’s intervention stimulated much research by agrarian historians of England, and the upshot of their enquiries was, in a nutshell, that he was wrong, and there was no simple competitive dynamic between landlord and tenant farmer – though historians usually give Brenner his due for re-energizing their field of enquiry. Brenner himself incorporated some of this revisionism into his later work, but his original formulation remains better known and more influential2.

One way in which a Brennerite view remains influential is a coarsened popular version whereby our modern capitalist ills in England are imputed to ‘the enclosure of the commons’, when profit-seeking landlords moved to stop peasants from accessing land and producing their subsistence. I’ll talk more about commons when I get to Part III of my book in this blog cycle, but the bottom line is that while the extinction of common rights did sometimes occur at the expense of peasant subsistence, enclosure was a hugely complex process, often involving peasants enclosing their own land, and the more you look in detail at its processes in the English countryside, the less clearly related they seem to the emergence of capitalism3.

All this prompts two questions. First, if capitalism didn’t arise in England through rural class conflict, then where and how did it arise? "


World Systems Theory Hypothesis of Asia-Europe Confluence

Chris Smaje:

" I’d suggest that capitalism arose, to quote from my own book, “out of a confluence where the great trading empires of Asia connected with the fiscal-military states of Europe and their seaborne empires that brought first precious metals and then plantation produce from the Americas into global circuits of exchange, much of it via the super-exploited labour of enslaved Amerindians and Africans” (p.62).

This alternative approach to capitalist origins was pioneered by thinkers of the left like André Gunder Frank and Immanuel Wallerstein. A couple of points to notice about it. First, it’s less Eurocentric or Anglocentric than Brenner: capitalism wasn’t the achievement of any single country or region, but resulted from relations between many – albeit relations greatly influenced by colonial domination enthusiastically prosecuted by European powers. Second, unlike the Brenner thesis, this approach makes the role of centralized states key to the emergence of capitalism. Again, despite powerful narratives to the contrary, capitalism has always been a state project – in fact, a project of commercial linkage between states. Brenner wrote an article criticizing this approach and its leading theorists for “neo-Smithian [i.e. commerce-emphasizing] Marxism”. In this, he built on a long left-wing tradition of claiming superior status through greater loyalty to the thought of Karl Marx, and of disdain for left-wing thinkers who look beyond it – a tradition that unfortunately still seems to be with us. But, unlike Brenner’s thesis, the ‘neo-Smithian’ approach now commands more general support among economic historians, leftwing and otherwise, despite ongoing disagreement about the details4.

Anyway, if we go back to English history with this more state-centred view of capitalism in mind, it becomes easier to notice that the Tudor state took steps to protect English peasants from expropriation by aristocratic landlords. This arose less from benevolence than from conflicts between state and aristocracy over command of resources, conflicts that England’s unusually weak aristocracy generally lost. It also becomes easier to notice how the early modern English state was locked in fierce battles with other European states – the Netherlands, France, Spain, Portugal etc. – to grow its economy through imperial control of wider trade and monetary networks.

I’d argue that capitalism arose more as an unintended consequence of this emerging system of competitive states than as a consequence of rural class conflict in England specifically. A look at the English countryside from the late medieval through the early modern period does show an increasing commercialism across all classes, with more monetization, capitalization and consumerism, and I’m not suggesting this had no bearing on the state’s trajectory towards capitalism. I’d nevertheless argue that the real motor of that trajectory was in the dynamics of the state and its competitors."



Recommended by Chris Smaje:

  • Brenner’s contributions and early responses to it are collected in T. Aston & C. Philpin’s The Brenner Debate (Cambridge, 1985).
  1. His later work includes Merchants and Revolution (Princeton, 1993).
  2. Other assessments, contestations and counternarratives to his earlier writing on English agrarian class structures include Jane Whittle (Ed) Landlords and Tenants in Britain, 1440-1660 (Boydell, 2013) – especially the essay therein by David Ormrod; Christopher Dyer A Country Merchant, 1495-1520 (Oxford, 2012);
  3. J. Blaut Eight Eurocentric Historians (Guilford, 2000);
  4. Henry Heller The Birth of Capitalism (Pluto, 2011).
  5. Robert Allen Enclosure and the Yeoman (Oxford, 1992);
  6. J. Yelling Common Field & Enclosure in England 1450-1850 (Macmillan, 1977).
  7. Robert Brenner. 1977. The origins of capitalist development: a critique of neo-Smithian Marxism. New Left Review 104: 25-93;
  8. Immanuel Wallerstein. 1974. The Modern World System;
  9. Ronald Findlay & Kevin O’Rourke. 2007. Power & Plenty;

Phases of Capitalism

McKenzie Wark on Jason W. Moore's distinctions:


"In Moore’s historical overview, there’s two eras of capital, one based on land productivity and a second on labor productivity. (In A Hacker Manifesto, I put it instead as three eras of commodity production, based on successive degrees of abstraction, first of land, then labor, then information. I called only the middle one ‘capitalism’, Moore calls the first and second together capitalism and describes the third with the more conventional term neoliberal capitalism.)" (

2. Building on Arrighi's periodization:

"Moore develops a periodization based on that of Arrighi, but significantly extending it, as Arrighi’s relentlessly sociological perspective tends to leave out the role of cheap nature. The periodization is as follows: the German-Iberian cycle (1451-1648), Dutch cycle (1560s-1740s), British cycle (1680s-1910s), an American cycle (1870s-1980s). Then there’s a neoliberal one, which we might all still be in.

In this view, capitalism starts with the central European mining boom of 1450s, and moves through a series commodity frontiers and busts. In each case, exhaustion is relational rather than substantial. “Exhaustion occurs when particular natures – crystallized in specific re/production complexes – can no longer deliver more and more work/energy.”

There are two kinds of crisis, epochal and developmental. An epochal crisis gave rise to capitalism out of feudalism. Note that it may have corresponded also to a climate variation. The crisis of feudalism is thus a complex of class, climate and demography. Limits are always historically specific in Moore, but we should note that they are all the same real limits. They only become relative in relation to a succeeding technological-social complex that renders them such. Nothing guarantees that there is always another historical form on the horizon.

Getting away from the limited historical view in which capitalism equals the industrial revolution and the exploitation of fossil fuels is one of Moore’s objectives, and in this he succeeds admirably. The form of commodity production that preceded the industrial revolution was already one that appropriated tract after tract of cheap nature. Hence it is not merely fossil-capitalism that’s the problem.

All the same, Moore does acknowledge the peculiar qualities of the British cycle. “For the first time in human history, planetary life came to be governed by a single logic of wealth, power and nature: the law of value.” Here under-production was solved through the input of vast amounts of cheap natures, for the first time on a truly planetary basis. However, both under-production in the form of crop failures and the more classic over-production crises were involved in the problems of 1848. This “dialectic of productivity and plunder” was the beginning of a global hegemony of the value relation, and an experience of peak appropriation on a planetary scale." (

Theories on the Origins of Capitalism

Ian Angus:

"Patel and Moore begin with a few pages about the end of feudalism in Europe, devote much more space to 16th century colonialism, and touch briefly on other places and times. The topics discussed, and the evidence offered, are carefully selected to support their argument that capitalism was invented in the 1400s on the Portuguese-occupied island of Madeira, that Columbus carried it to the Caribbean, and that from then on it was a fully developed world-ecology. There is no need to discuss the industrial revolution because 16th century sugar plantations were essentially factories, and no need to discuss the rise of fossil capitalism in the 1800s because the Dutch burned a lot of peat 200 years earlier.

The authors’ account of the origins of capitalism is adapted, in simplified form, from Immanuel Wallerstein’s world-systems theory. They never mention that other radical historians view the birth of capitalism differently. Robin Blackburn, the leading historian of western hemisphere slavery, says that early Spanish colonialism was driven by thirst for silver and gold to finance dynastic wars and to buy spices from Asia — it was inhumane and brutal, but not focused on capital accumulation. Henry Heller argues that the 16th century was a time of primitive accumulation, the beginning of a long transition to capitalism that was only completed with the industrial revolution. Charles Post argues that plantation slavery was a non-capitalist mode of production and a barrier to capitalist development. Karl Marx, as his masterwork Capital demonstrates, viewed industrial capitalism in 19th century Britain as a distinctive new stage of social and economic history that required in-depth study and analysis: he certainly never suggested that capitalism’s essential characteristics were fully established in Columbus’s time." (

Was there 'Capital Imperialism' before 'Industrial Capitalism' ?

By K. Ekholm and J. Friedman:

"The above title may appear provocative to those who would maintain that capital is, by definition, wage-labor capital, that imperialism is the highest stage of capitalism, and that before the industrial revolution there were only "embedded" economies whose goals were related to the gaining of prestige, conspicuous consumption, and the maintenance of alliances for "social reasons" (Polanyi 1947; Finley 1973: 130, 158). This is because our argument is aimed at a tendency in anthropology and anthropologically influenced history and archaeology to divide the world's history into distinctive market/nonmarket or capitalist/precapitalist systems. We feel that such "substantivist" and "historical-materialist" categorizations are based on false abstractions from reality that obscure some of the essential continuities of social evolution from the rise of the first civilizations. Our own point of view is that there exists a form of "capitalism" in the ancient world, that there are "world economies," and that many properties of the dynamics of such systems are common to our own world economy. This is not to take a stand for the "formalist" approach in economic anthropology. The entire substantivist/formalist debate, which centers on the question of market rationality versus socially prescribed non=optimizing behavior in precapitalist society, is very much a distortion of the original primitivist/modernist debate. The latter was not concerned with general models of individual behavior but with the macrostructure of ancient (not primitive) economies (Biicher 1893; Meyer 1910; Rostovtzeff 1957; for a discussion see Humphreys 1970). The opponents of the primitivists did not stress the praxeology of individual maximizing agents but rather the substantive existence of a kind of capital accumulation in the ancient world. Their argument was, in Polanyi's own definition, a substantivist one insofar as they attempted to characterize a specific social system and not to assert a basic propensity of the human species.

We do not deny that there are important differences between industrial capitalism and the ancient systems. It is clear that the modern system in which industrial capitals compete for survival by direct investment in the productive forces implies a kind of dynamic unknown in the past. The accumulation of capital as a form of abstract wealth, however, is a truly ancient phenomenon. To say that this ancient "capital" played a fundamental economic role is not to say that it functioned directly in the production process, but that its accumulation and control were dominant features of those economies. The system to which we refer is characterized not only by an accumulation of capital, but by the emergence of an imperialist pattern: center/periphery structures are unstable over time; centers expand, contract, and collapse as a regular manifestation of the shift of points of accumulation. These phenomena are, we think, more general than modem capitalism. Similarly, the world economic crisis that we are experiencing today can be understood in terms of processes more general than a capitalist mode of production, processes that constitute a disastrous dynamic that has been the driving force of "civilized" history.

Our point of departure is that the forerunner of the present kind of world-system first emerged in the period following 3000 bc in southern Mesopotamia. Here we can describe the first example of the rise of a center of accumulation within a larger economic system and the development of an imperialist structure."




What do we have now ?

David Graeber on the current conjuncture, in an interview conducted by Arthur De Grave:


D. G. The nature of capitalist accumulation has changed dramatically. When I was an undergraduate, my teacher in economic history used to say when the extraction of the surplus happens through direct political means, it’s not called capitalism, but feudalism. That’s what we have today: a fusion of public and private bureaucracies whose purpose is to create more and more debt that will then be the object of various forms of speculation. The only way to create more debt in the first place is through policies: there is no such thing as “financial deregulation”, it is just a change in the mode of regulation. In classic marxist theory, the role of the state is to guarantee the property relations which then enable extraction to happen through wage labour. But now, the state apparatus plays a more active role in this process.

When the extraction of the surplus happens through direct political means, it’s not called capitalism, but feudalism We are living in the era of predatory bureaucratization. What percentage of the typical American household revenue is directly extracted by the financial sector? Oddly, this is the one economic statistic you cannot easily get, but when economists make estimations, it falls somewhere between 20% and 40%. Most of the profits are not coming from the industry anymore. Yet, when we think of the history of capitalism, we think of industries, wage labor… Clearly, that’s not what we have today. There is no more reason to believe that capitalism will be around forever. For centuries, the Roman Empire was able to absorb barbarian tribes, to draw them into the Roman system, to give their chiefs titles and offices… And one day, they forgot to give Alaric a promotion, which got him pretty upset. We all know what happened then. It’s permanent until it’s not, every contradiction is absorbed until it isn’t." (

Discussion 1

How Capitalist Markets Differ from Markets Before and After Capitalism ?

Jesse A. Myerson:

"It wasn’t until hundreds of years after Marco Polo’s travels that the dramatic transformation of the system of production began—and in a curious place. Wood demonstrates that the capitalist “laws of motion” did not emerge in urban commercial centers, as is normally supposed, but in the countryside. Specifically, the English countryside. English landholding was inordinately concentrated, so “an unusually large proportion of land was worked not by peasant-proprietors but by tenants,” as Wood explains. For most of the feudal age, English tenancies were “Freehold leases,” with rents fixed by a legal or customary standard, but by the sixteenth century, a growing number were “Copyhold leases,” auctioned by landlords to the highest bidder, their rental value set at whatever the market would bear. The more competition there was in the market for rental land, the more notice landlords and their surveyors began to take of the “value above the oulde Rentes” that could be extracted through this market. And so England underwent great waves of land enclosure, separating the masses from direct access to the means of their own subsistence.

At this point, in addition to competing in a market for consumers, tenants were obliged to compete in a market for access to land. In the system emerging out of the particularly English invention of a land-rent market, farmers were subjected to a “systematic need to lower the costs of production in order to prevail in price competition.” Those who failed to compete in this market found themselves dispossessed of all but their own capacity to perform labor, which they flocked to cities to sell, or else to starve.

This, and not the availability of markets, is the essence of capitalism, the engine motoring in its depths. From this imposition, and thus this dispossession, capitalism sprang to life. Now the masses were at the mercy of a job market to obtain the means to reproduce themselves socially. Now the process of production was systematically subordinated to market imperatives: “competition, accumulation, and profit-maximization, and hence a constant systemic need to develop the productive forces.”

These imperatives, in turn, give capitalism its ability (and charge it with the necessity) to relentlessly expand in unprecedented ways and degrees. “It can and must,” as Wood insists, “constantly accumulate, constantly search out new markets, constantly impose its imperatives on new territories and new spheres of life, on all human beings and the natural environment.” (

Why Capitalism Doesn't Work

Will Hutton summarizes Thomas Piketty's landmark book Capital in the Twenty-First Century:

"Like Friedman, Piketty is a man for the times. For 1970s anxieties about inflation substitute today's concerns about the emergence of the plutocratic rich and their impact on economy and society. Piketty is in no doubt, as he indicates in an interview in today's Observer New Review, that the current level of rising wealth inequality, set to grow still further, now imperils the very future of capitalism. He has proved it.

It is a startling thesis and one extraordinarily unwelcome to those who think capitalism and inequality need each other. Capitalism requires inequality of wealth, runs this right-of-centre argument, to stimulate risk-taking and effort; governments trying to stem it with taxes on wealth, capital, inheritance and property kill the goose that lays the golden egg. Thus Messrs Cameron and Osborne faithfully champion lower inheritance taxes, refuse to reshape the council tax and boast about the business-friendly low capital gains and corporation tax regime.

Piketty deploys 200 years of data to prove them wrong. Capital, he argues, is blind. Once its returns – investing in anything from buy-to-let property to a new car factory – exceed the real growth of wages and output, as historically they always have done (excepting a few periods such as 1910 to 1950), then inevitably the stock of capital will rise disproportionately faster within the overall pattern of output. Wealth inequality rises exponentially.

The process is made worse by inheritance and, in the US and UK, by the rise of extravagantly paid "super managers". High executive pay has nothing to do with real merit, writes Piketty – it is much lower, for example, in mainland Europe and Japan. Rather, it has become an Anglo-Saxon social norm permitted by the ideology of "meritocratic extremism", in essence, self-serving greed to keep up with the other rich. This is an important element in Piketty's thinking: rising inequality of wealth is not immutable. Societies can indulge it or they can challenge it.

Inequality of wealth in Europe and US is broadly twice the inequality of income – the top 10% have between 60% and 70% of all wealth but merely 25% to 35% of all income. But this concentration of wealth is already at pre-First World War levels, and heading back to those of the late 19th century, when the luck of who might expect to inherit what was the dominant element in economic and social life. There is an iterative interaction between wealth and income: ultimately, great wealth adds unearned rentier income to earned income, further ratcheting up the inequality process.

The extravagances and incredible social tensions of Edwardian England, belle epoque France and robber baron America seemed for ever left behind, but Piketty shows how the period between 1910 and 1950, when that inequality was reduced, was aberrant. It took war and depression to arrest the inequality dynamic, along with the need to introduce high taxes on high incomes, especially unearned incomes, to sustain social peace. Now the ineluctable process of blind capital multiplying faster in fewer hands is under way again and on a global scale. The consequences, writes Piketty, are "potentially terrifying".

For a start, almost no new entrepreneurs, except one or two spectacular Silicon Valley start-ups, can ever make sufficient new money to challenge the incredibly powerful concentrations of existing wealth. In this sense, the "past devours the future". It is telling that the Duke of Westminster and the Earl of Cadogan are two of the richest men in Britain. This is entirely by virtue of the fields in Mayfair and Chelsea their families owned centuries ago and the unwillingness to clamp down on the loopholes that allow the family estates to grow.

Anyone with the capacity to own in an era when the returns exceed those of wages and output will quickly become disproportionately and progressively richer. The incentive is to be a rentier rather than a risk-taker: witness the explosion of buy-to-let. Our companies and our rich don't need to back frontier innovation or even invest to produce: they just need to harvest their returns and tax breaks, tax shelters and compound interest will do the rest.

Capitalist dynamism is undermined, but other forces join to wreck the system. Piketty notes that the rich are effective at protecting their wealth from taxation and that progressively the proportion of the total tax burden shouldered by those on middle incomes has risen. In Britain, it may be true that the top 1% pays a third of all income tax, but income tax constitutes only 25% of all tax revenue: 45% comes from VAT, excise duties and national insurance paid by the mass of the population.

As a result, the burden of paying for public goods such as education, health and housing is increasingly shouldered by average taxpayers, who don't have the wherewithal to sustain them. Wealth inequality thus becomes a recipe for slowing, innovation-averse, rentier economies, tougher working conditions and degraded public services. Meanwhile, the rich get ever richer and more detached from the societies of which they are part: not by merit or hard work, but simply because they are lucky enough to be in command of capital receiving higher returns than wages over time." (

The point of view of Binary Economics

"An economic/financial system where a relatively small number of individuals own the vast bulk of capital assets, and where the majority of the population is employed at a wage and owns little or no capital.

Louis Kelso used the term "capitalism" (or "universal capitalism") to describe a free market system where capital (as opposed to labor) is the predominant factor of production, and where there exists the widest possible distribution of private ownership of capital among the households of the economy. For semantic and philosophical reasons, however, a growing number of binary economists have rejected any use of the term "capitalism" to describe the logical alternative to traditional capitalism and socialism. (See Just Third Way.)

The term "capitalism" was invented as a pejorative by socialists, not by Adam Smith or other pioneers of free market economics. Advocates of the "Just Third Way" assert that where socialism as a socio-political system reflects the "institutionalization of envy," capitalism represents the "institutionalization of greed." While the word "capitalism" retains some degree of respectability within the United States and other developed countries, it has become increasingly disparaged by opponents of globalization and many citizens in the developing world.

Capitalism is often confused with "free markets" or "democracy," but in practice has historically resulted in mercantilism, concentrated power and monopoly. So-called "democratic capitalism," as some have labeled America's socio-economic system, has fostered an unstable, conflict-prone and class-divided combination of political democracy and economic plutocracy. While many defenders of democratic capitalism share with binary economists support for limited economic power of government, establishment of free markets and free trade, and restoration of private property rights, they generally treat universal access to capital ownership as irrelevant politically and economically.

Expressed as an "ism," "capital-ism" connotes an ideology or value system that places its highest value on capital (or "things"), ranking it higher in importance than labor (or human beings). From the standpoint of binary theory itself, the term fails to acknowledge the interdependence and respective contributions of both capital and labor, with the distribution of incomes to both factors determined by market principles as well as principles of economic justice.' (

The anti-ecological growth imperative

Fred Magdoff:

"The growth imperative of capitalism deserves special attention because it is one of the major stumbling blocks with respect to harmony between humans and the environment. Accumulation without end means using ever greater quantities of resources—without end—even as we find ways to use resources more efficiently. An economy growing at the very meager rate of 1 percent a year will double in about seventy-two years, but one growing at 2 percent a year, still a low rate, will double in size in thirty-six years. And when growing at 3 and 4 percent, economies will double in twenty-four and eighteen years respectively. China recently has seen recorded growth rates of up to 10 percent, meaning economic output doubles at a rate of approximately every seven years! Yet, we are already using up resources far too fast from the one planet we have—depleting the stocks of nonrenewable resources rapidly and misusing and overusing resources that are theoretically “renewable.” If the world’s economy doubles within the next twenty to thirty years this can only hasten the descent into ecological, and probably societal, chaos and destruction.

Thus capitalism promotes the processes, relationships, and outcomes that are precisely the opposite of those needed for an ecologically sound, just, harmonious society." (

Discussion 2

Capital as Power

By Shimshon Bichler and Jonathan Nitzan:

"The emphasis here on active ‘human agency’ is crucial, and all the more so since existing theories of accumulation tend to ignore it. For the neoclassicists, capitalists can try to increase their profi t until they are blue in the face. It will not help them. In a competitive market, profit is equal to the productive contribution of capital, not to the eff ort of its owner. Karl Marx ridiculed the notion that capital could be ‘productive.’ Only labor was productive. The source of profit was the institution of private ownership, which left the means of production in the hands of capitalists and forced workers to settle for wages lower than the value of their output. In this scheme, Marx recognized the power foundations of capital—the power of capital over labor. Paradoxically, however, beyond this abstract recognition, his analysis of accumulation left little room for concrete power.

Of course, Marx was the fi \rst to note the growth of big business and the formative role of the state in the genesis of capitalism, themes that were later developed by neo-Marxist state theorists and the analysts of monopoly capitalism. But to emphasize these aspects of power was to undermine the labor theory of value. Th is latter theory relied heavily on the Newtonian assumptions of atomistic competition, the free mobility of capital and labor, and the lack of ‘intervening’ factors such as governments—all of which assumptions were compromised by the ascent of giant corporations and big government. Th e result was an increasingly sophisticated explanation of capitalist power built on an increasingly shaky theory of capital accumulation.

Monopoly Capital theorists took a step forward, by emphasizing the role of centralized power in mature capitalism and by recognizing that such power made labor values more or less irrelevant for the actual trajectory of prices and profits. But they failed to take the next logical step, namely to rethink the implication of power for the concept of capital itself.

This failure was candidly acknowledged by Paul Sweezy in his assessment of Monopoly Capital, a book which he wrote together with Paul Baran twenty-five years earlier:

- Why did Monopoly Capital fail to anticipate the changes in the structure and functioning of the system that have taken place in the last twenty-five years? Basically, I think the answer is that its conceptualization of the capital accumulation process is one-sided and incomplete. In the established tradition of both mainstream and Marxian economics, we treated capital accumulation as being essentially a matter of adding to the stock of existing capital goods.

But in reality this is only one aspect of the process. Accumulation is also a matter of adding to the stock of financial assets. The two aspects are of course interrelated, but the nature of this interrelation is problematic to say the least. The traditional way of handling the problem has been in effect to assume it away: for example, buying stocks and bonds (two of the simpler forms of financial assets) is assumed to be merely an indirect way of buying real capital goods. This is hardly ever true, and it can be totally misleading. This is not the place to try to point the way to a more satisfactory conceptualization of the capital accumulation process. It is at best an extremely complicated and difficult problem, and I am frank to say that I have no clues to its solution.

But I can say with some confidence that achieving a better understanding of the monopoly capitalist society of today will be possible only on the basis of a more adequate theory of capital accumulation, with special emphasis on the interaction of its real and financial aspects, than we now possess. (Sweezy , emphasis added)

In our view, the alternative is to think not of accumulation and power, but of accumulation as power.¹² Th e Marxist belief, according to which surplus value is first ‘produced’ by industrial capitalists and then ‘redistributed’ through intra-class power struggle among the different fractions of the capitalist class, is a grand myth which has run its course. Instead, we argue that all capitalized earnings, regardless of their ‘source,’ are reflections/expressions of power—the power of capitalists to shape and transform the course of society to their own ends. What is being ‘capitalized,’ always, is not abstract labor, but power itself. And since power, by its very nature, is differential, so is accumulation. Th is is the crux of the matter."


Characteristics of the Current Crisis of Capitalism

Wolfgang Streeck:

"Crisis symptoms are many, but prominent among them are three long-term trends in the trajectories of rich, highly industrialized—or better, increasingly deindustrialized—capitalist countries.

  • The first is a persistent decline in the rate of economic growth, recently aggravated by the events of 2008.
  • The second, associated with the first, is an equally persistent rise in overall indebtedness in leading capitalist states, where governments, private households and non-financial as well as financial firms have, over forty years, continued to pile up financial obligations.
  • Third, economic inequality, of both income and wealth, has been on the ascent for several decades now (Figure 3, below), alongside rising debt and declining growth."


Theories on the End of Capitalism

Francesco Boldizzoni:

"We can classify forecasts into four types based on the causal chain they assume. First, there are the implosion theories typical of orthodox Marxism, according to which capitalism would implode because of its economic contradictions. A second group includes the exhaustion theories of the likes of John Stuart Mill and John Maynard Keynes. For these thinkers, capital accumulation would stop at some point due to environmental limits, saturation of material needs, moral or civilizational progress. Next come the theories of convergence that were particularly in vogue in the interwar period and the following years of the “end of ideology.” These stressed how technological development and the trend toward state planning were making capitalism and socialism increasingly resemble each other. Finally, mention should be made of the cultural involution theories associated with Joseph Schumpeter, Daniel Bell, and to some extent Jürgen Habermas. These pointed to the self-defeating character of bourgeois society, emphasizing how capitalism, by breeding its parasites and critics, was undermining its own values while even the political superstructure erected to save the system from itself was prey to disintegrative tendencies." (

What can we do against capitalism ?

Kojin Karatini:

"there are two ways to stop the perpetual movement of the capitalist economy.

One is the struggle immanent in the capitalist economy. This is centered on boycott movements.

Another struggle is to expand the non-capitalist market economy (producers/consumers cooperative and local currency). We call the latter an exscendent struggle. In the process M—C— M’, there are two critical moments that capital has to confront: buying labor-power commodity and selling products to workers. Failure in either moment disables capital from achieving surplus value. In other words, it fails to be capital. That is to say that in these moments, workers can counter capital.

The first moment is, in Antonio Negri’s phrase, “Don’t Work!” This really signifies, in our context, “Don’t Sell Your Labor-Power Commodity!” or “Don’t Work as a Wage Laborer!”

The second moment says, like Mahatma Gandhi, “Don’t Buy Capitalist Products!” Both of them can occur in the position in which workers can be the subject. But in order for workers/consumers to be able ‘not to work’ and ‘not to buy’, there must be a safety net whereupon they can still work and buy to live. This is the very exscendent struggle involving the producers/consumers cooperatives. The struggle within inexorably requires these cooperatives and the formation of LETS (Local Exchange Trading System). Furthermore, the exscendent struggle can accelerate the reorganization of the capitalist corporation into cooperative entity. NAM intends to organize the interaction between the one immanent in and the one exscendent to the capitalist mode of production/consumption." (NAM program)??

The contradictions of capitalist democracy

Branko Milanovic:

"Modern capitalism societies are built on a dichotomy: in the political space decisions are (to be) made on an equal basis with everybody having the same say and with the structure of power being flat; in the economic space the power is held by the owners of capital, the decisions are dictatorial, and the structure of power is hierarchical. The dichotomy was always a complex balancing act: at times, the political principles of nominal equality tended to intrude into the economic space and to limit the power of owners: trade unions, ability to sue companies, regulations regarding discrimination, hiring and firing. At other times, it was the economic sphere that invaded the political: the wealthy were able to buy politicians and impose the laws they liked.

The entire history of capitalism can be readily understood as the struggle between these two principles: is the democratic principle “exported” from politics to rule in economics too, or is the hierarchical principle of company organization to invade the political sphere. Social democracy was essentially the former; neoliberalism was the latter." (

Capitalism in sustainability transitions

Giuseppe Feola (2020):

“Capitalism is [a] historically specific form of social and economic organisation, which is characterised economically by the private property of the means of production, the freedom to pursue economic gains through production and the market, the transformation of labour power into a commodity, the owners’ control of the means of production and the destination of value generated through production, and the generalisation of production and exchange of commodities” (Gallino, 1993; cited from Feola, 2020).

The most fundamental dynamics of capitalism relate to the imperative of capital accumulation (Harvey, 2006). Strategies for capital accumulation include the externalization of costs, the lowering of labour costs, and the search for surplus value through the penetration of capitalist relations (commodification) in biophysical and human bodily and emotional life spheres (Harvey, 2006). Privatization and commodification are often accompanied by the enclosure of biophysical and other resources in processes of accumulation by dispossession, which may entail economic and extra-economic means, including violence (Glassman, 2006). The process of accumulation is characterized by the concentration of capital and by exclusionary social relations and rising levels of inequality (Harvey, 2006; Picketty, 2013). Other strategies for capital accumulation are the geographical expansion of the market economy and the displacement of capital over space and time (Harvey, 2006). Capitalism is ‘constituted’ by space-time arrangements in which ‘time and space work together in ways particular to the capitalist mode of producing, distributing, selling, consuming and disposing of commodities’ (Castree, 2009, p.26).

Capitalism also entails a ‘more comprehensive cultural, social and political architecture’ (Gregory, 2000, p. 57; Sheppard, 2015). In other words, accumulation depends not only on economic structures and strategies, but on extra-economic ones (Jessop, 2007). Culturally, capitalism permeates and shapes individual and collective identities and relations beyond the economic sphere, and includes the principles of competition, individualisation, rationalisation, commodification of human and non-human beings, and the imaginary of progress based on endless accumulation (e.g., Gregory, 2000; Parr, 2017; Urry, 2010; Wilhite, 2016). Politically, capitalism rests on state structures that participate in its reproduction both in periods of stability and crisis. The state in a capitalist system is a ‘strategic field’ (Poulantzas, 2002, cited in Brand, 2016:11); it reflects and mediates capitalist power relations through regulation, discourses, and material resources; it often undertakes unprofitable activities that capital does not undertake, and it obtains revenues from taxation thus ultimately depending on continuous economic growth for its stability (Jessop, 2007).

Thus, capitalism is referred to here as a social construction that emerged and became established under historical conditions (Polanyi, 1944; Meiksins Wood, 2002), but is also diverse and mutates over space and time as it co-exists with non-capitalist forms of being and doing. With reference to the latter point, two elements particularly need to be emphasised for the purposes of this paper. First, although I use the term ‘capitalism’ in its singular form for the sake of brevity, this system is not homogeneously present in space, nor does it exist in any ‘pure’ form. In fact, some scholars have argued that what most Western countries have experienced thus far is a form of semi-capitalism (e.g., van den Bergh, 2017). More importantly, it has been amply and convincingly demonstrated that capitalism operates in a range of varieties that retain core elements even as they differ in other respects (e.g., Hall and Soskice, 2001).

Second, capitalism is often depicted as a dominant, and all-encompassing system in which the principles of individualisation, competition, productivism and market mechanisms extend from the economic realm to society at large (i.e., a market society) (Parr, 2017; Polanyi, 1944; Sandel, 2012). In fact, while hegemonic, capitalism co-exists with non-capitalist logics, institutions, and practices (see Thornton et al., 2012). Logics that are alien from capitalistic norms of individualism, competition, the belief in endless economic growth, and accumulation, among others, exist ‘here and now’ in the interstices of modern capitalist societies. They materialise in alternative experiments and trajectories, and in common forms of economic and social organisation such as cooperatives, alternative finance- and local exchange networks, and everyday family practices (Chang, 2011; Gibson-Graham, 2006a; Princen, 2006; Raworth, 2017; Sheppard, 2015; Thornton et al., 2012; Wright, 2010). Indeed, scholars have demonstrated that capitalism rests on ‘hidden’ (unvalued in economic terms) social reproduction in the household, non-market exchanges, and non-utilitarian rationality as expressed in social solidarity networks and related manifestations (Gibson-Graham, 2006a)." ( )

Discussion 3

Overview of critiques of capitalism from the right


"Moving on from left-wing critiques of capitalism, we have Georgism, which sits uncomfortably on the boundary between the left and right. The basic idea is quite simple: that land is a corporative asset held jointly by all society, and so we need a land value tax to redistribute the gains from economic rent, which by extension are held jointly by all society. This is an intriguing school of thought that maintains the concept of private property along with the concept of corporative property, but it doesn’t go far enough—why should only land be corporatively owned? What’s more, it still bases its analysis on utilitarian assumptions, without stopping to inquire whether these assumptions are part of the problem of capitalism in the first place.

Various critiques of capitalism have been levelled by fascists. The best known is perhaps that by Gottfried Feder, whose Manifesto for Breaking the Interest Bondage of Money is directed toward abolishing usury. This anti-usury concept in some ways echoes the Georgists, where the money supply is viewed as a kind of corporative asset, the loan of which is to be managed by state-run institutions with corporative ends in mind. Feder’s analysis is right, but it doesn’t go far enough either—clearly there’s more to the problem than usury.

Another important fascist critique is offered by Ugo Spirito. His programmatic economy turns the idea that “authoritarianism is fine in a village but not in industrial societies” on its head. Liberal economics, with its idea of the invisible hand, rejects the idea that the economy is directed from above, but Spirito points out that no economy is ever anything but—which events since 2016 have demonstrated quite clearly. All societies have an economic program, including capitalist societies. Where capitalism differs from fascism is that the program, the goal, is hidden, not discussed out in the open amongst syndicates, corporations, or guilds, but behind closed doors amongst technocrats with no accountability. Far from producing subsidiarity, capitalism obscures authority by pretending to do away with it, thereby making it unopposable.

Finally, we get an interesting critique of capitalism from the right by the distributists, exemplified by the papal encyclical Rerum Novarum. Like the fascists, they take an integral approach to economics, prizing subsidiarity and modelling themselves after the guild system. Where distributism stands apart is in its theological approach to economics, partly sacralizing property as something God-given and ipso facto something inherently corporative. This is a very attractive school of thought, but it does tend to be wary of state socialism and so there is a question of how land is to be distributed, and it does subscribe to the bottom-up social ontology of many of the left-wing critiques.

Overall, the critiques from the left generally miss the mark, whereas the critiques from the right are more on target but are largely ahistorical."


Capitalism as non-sacred, non-traditional, non-social property


"Overall, the critiques from the left generally miss the mark, whereas the critiques from the right are more on target but are largely ahistorical. And none of these critiques really attempts to drill down and work out exactly what capitalism is in the first place—except, to its credit, Marxism. If capitalism is simply something like “private ownership of property for profit,” where’s the objection? Private property is as old as the hills, and man has always expected profit from the soil. If this definition applies as well to us today as it applies to the classical world, perhaps we need to dig a bit deeper.

As an alternative to this I propose a different definition of capitalism, and implicit in this definition is a foundational critique. The definition is simple: Capitalism Is the Total Desacralization of Property. All the valid critiques just mentioned are comprehended and contained in this definition.

The emphasis here is on property. Capitalism is primarily about property, because economics, from Greek oiko-nomos (lit. “household law”)—economics without property is empty of content. But capitalism is not about private property, certainly not in the Marxian sense—Marx’s notion of private property cashes out to the ability to rent things: non-usufruct property. But non-usufruct property is ancient. Double-entry bookkeeping is ancient too, so it’s not about profit either. Nor is it about markets, commerce, entrepreneurship, supply and demand, commodification—it’s not even about capital. All these things formed the backbone of ancient economies.

Capitalism is not primarily about private property, but it’s about some sort of property. So, to understand the break between capitalism and what came before it, let’s work our way back, and find out how property has changed with time.

On the surface, the major break between feudal and capitalist property relations was in breaking away from joint-ownership. There’s an inherent sociality to feudalism not found in later social orders. Feudalism arose from the combination of vassalage with fief-holding—that is, it arose from the inherently personal obligation to a man, in conjunction with the granting of immovable property by that man. Property under feudalism is bound up with social obligation—all property is held subject to the performance of duties.

But the duties are not entirely one-sided. The mark of feudal property is the double-proprietorship, and this two-way ownership holds between lord and vassal, as well as between landlord and tenant. The vassal holds his fief only so long as he renders his lord homage and service. Later, as feudal property became desacralized, this service could be acquitted in terms of payment, but originally the obligation had to be carried out personally. However, the lord also had duties to his vassal, and if the lord didn’t offer protection, immunity, and political authority, the vassal was not obligated to him. It was the same between landlord and tenant—the tenant owed the landlord service, but the landlord owed him protection and the maintenance of his rights. In feudalism we see the superior ownership of the lord of the fief coexisting with the inferior ownership of the tenant. How different is all this than under capitalism? Joint-ownership is not just possible, as under capitalism, but all property is corporative.

One mark of sacral property is inalienability; feudal property was not exactly inalienable, but in some degree indivisible. The serf can’t be alienated from his land and can’t be parted from his family—this is one of his rights, which is God-given and sacred. More sacral still is the conveyance of the fief, the transaction upon which the entire feudal economy depended, and this was done by the vassal rendering the lord homage and fealty. These two obligations are not exactly synonymous—homage is older, and traces back to the ancient Germanic custom of admission into the männerbund, whereas fealty gives Christian sanction to this obligation. Homage, however, was the essentially religious tie that bound all feudal society together, including its property relations.

All feudal property stood upon this sacral basis, however indirectly. Later, the glue that held the system of property relations together came to be the great chain of being, where each man in the divine hierarchy, from bonded serf all the way up to the Holy Roman Emperor, could trace his part in the social order unto the throne of God himself. And property itself was in some sense consecrated. It was restricted in its usages; it was possible to abuse it; above all, property conferred not only rights, but duties. Property was not exactly a sacred relation, but nor was it purely economic—it was a mixture of the two. The break between feudalism and capitalist was not so much the break between corporate and individual ownership; more fundamentally the break involved the loss of this mixed sacrality.

But it was a mixed sacrality. Feudalism was a mixture of Germanic and Roman elements, and to see the different elements each brought to the table, we have to seek the origins of feudalism itself."


From the Formal Domination of Society to the Real Domination of Society

Yann Sturmer:

"The report to the Club of Rome in 1972. This text is not only an attempt to respond to the thermodynamic limits of the biosphere, but also the birth of a capital that could integrate the deadly limits it faces to make of them a lever for its reformation, with a new economy, supported by a new art of living and bearing a new religion. In short, as Jacques Camatte was able to say: capital becomes a community, even the only community, the social relation that men have lost. Camatte calls this the anthropomorphisis of capital: it takes human form by synthesizing the total alienation of the human community. To understand more precisely how capital’s utopia is formed, it is necessary to grasp the changes in the economy first and in the psyche second.

Cesarano takes on board Camatte's interpretation of the 6th unpublished chapter of Capital in Capital and Gemeinwesen. In this book, Camatte comments on Marx and delves into two important aspects of his text. The first concerns the distinction between the formal and real domination of capital over labour. When capital develops in its early years, it only formally dominates production relations. That is to say, the craft activity which preceded it now becomes subject to the law of capital, which is that of the extraction of surplus value. In a second step, with the development of industry, capital is no longer content to formally dominate labor, but also really dominates it, because it is the production process itself that is entirely created and designed according to its requirements. Starting from Marx’s distinction between formal domination and real domination of labor under capital, Camatte extends the concepts to society itself, considering a phase of formal domination of capital over society, and a phase begun after the Second War, of real domination of capital over society, in which it is human activity as a whole that is structured, modeled and conceptualized in terms of capital: "capital is henceforth the oppressive common being of men" (Camatte). Capital, by really dominating society, becomes a material community that encloses and sustains human life, rendering humanity entirely dependent thereupon and structuring man’s imagination."


More Information

  • Katharina Pistor’s 2019 book, The Code of Capital: How the Law Creates Wealth and Inequality, explains how law under capitalism creates the conditions for capital accumulation