The horizon is not so far as we can see, but as far as we can imagine

The Essence of Capitalism

Eric Anderson wrote an excellent post on how late-stage capitalism engenders mental illness. I thought I’d follow it up with a simple post on capitalism.

As the name implies, capitalism is the accumulation of capital. This doesn’t mean money, primarily, that’s not what the early theorists meant by capital: they meant the means of production: land, workers, resources and capital goods: machinery in particular.

Capital is the ability to make and grow items. Because of economy of scale, if you concentrate capital it is easy to increase how much you make: Adam Smith’s famous pin factory.

But to concentrate capital you have to take it from a large number of people and put it in the hands of the few. This has been covered by a number of authors, and it involves taking away the commons rights of people in Europe (their right to use the land, which had existed for about a thousand years or so). We demonize serfs and peasants, and they had to engage in demeaning acts of servility, but they had strictly defined obligations to their lords for a certain amount of work, crops and animals and once that was taken care of they were able to spend their time as they pleased and they could grow crops on land they had right to; pasture their animals and so on.

Economists call the concentration of capital “primitive accumulation” but what it was was taking away property rights from people so they couldn’t support themselves. This forced them to go to cities and work in factories and so on, where they lived shorter lives, worked a hell of a lot harder (6 1/2 12 hour days were pretty common) and were sick a lot more often. The freedom of capitalism is the right to sell your labor, not the right to control how you spend your day. Unlike serfs and peasants, who were tied to the land, you could choose your master, but for most of the population, that’s what it was, a choice of masters, at least when there weren’t enough workers.

In the rest of the world European capitalism was about conquering land and into the 19th century, about taking slaves. The only thing better than workers who are desperate being workers who you didn’t even have to pay.

Capitalism, again, is about concentrating the means of production, capital, in the hands of the few. It is justified by the idea that concentrated capital is more effecient and therefore everyone has more. There’s a lot of arguments about whether that’s true and we now know, for example, that land clearances didn’t increase agricultural productivity much more than on communal lands, and in the case of some crops, communal lands were more efficient.

But it’s hard to make the case for the path not taken. Perhaps communal forms could have worked, I think they could have, and would have produced more prosperity in time, since they didn’t involve impoverishing people and two-thirds of the non-European globe, but… the water is passed and the argument is important not for what might have been, but for what might be in the future.

But all systems are made up of means and ends. Capitalism justifies removing the ability of most people to support themselves without working for others beyond what amounts to taxation by the violent authorities (that’s all governments. Don’t pay your taxes and eventually the big men with guns will show up, just like the knights did when a peasant didn’t meet his feudal contract.)

The means of capitalism in the modern world amount to “wage slavery,” something well  understood by they yeoman farmers who were being forced off their land in the 1800s, and who seem to have coined the phase. You will have a master and if you can’t find one, you will starve.

It’s important to separate “capitalism” and “industrialization”. Because we industrialized under capitalism we think of the two as the same thing, or perhaps as co-joined siamese twins, but it’s not hard to imagine industrializing, which is about machines and assembly lines, in different ways: perhaps with communal organizations co-owning the means of production. This is distinct from Soviet communism, in which the government effectively owned everything, leading to the normal problems of totalitarian organization. Plurality and capitalism and synonyms.

This is something you need to think through; to imagine, for yourself. Try and come up with different ways industrialization and technology could have advanced, and don’t be caught up in historical inevitability. If you think that the past could not have been any different, then you effectively believe the future is determined.

This is one of the issues of Marxism: historical determinism. When it turned out (at least so far) that the historical dialectic didn’t work out how Marx and Engels envisaged, well, the house of cards collapsed. You have to give up inevitability to have choice and the ability to adapt.

We have plenty of options for the future and do not have to make the mistakes of the past. The first principle is that if your means are bad, no matter how good your ends, your society is going to have huge problems. You can’t routinely do evil, day in and day out, and expect the some invisible hand to lead to a good world for all.

The results of the work I do, like this article, are free, but food isn’t, so if you value my work, please DONATE or SUBSCRIBE.


Capitalism as Mental Illness, by Eric Anderson


Fire From The Gods: the Original Sins of Agriculture and Industrialism And Hope For The Future


  1. bruce wilder

    Talking about the “essence” of a set of complex, emergent social phenomena is hazardous. The processes by which such a system comes into being has some elements in common with biological evolution, including a significant degree of chance and “blind” selection of survivors.

    In the present state of U.S. neoliberal capitalism, monopolization driven by financialization is theoretically reversible. We know this from the example of the New Deal. Making this politically feasible is a difficult problem. The determined ignorance cultivated in academic economic and its rhetoric of a “market economy” and indeed the etymology of “monopoly” as meaning a single-seller into a market, remain major obstacles to conceiving of politically persuasive and legally enforceable remedies. Something as outrageous as astronomical insulin prices does not call forth outrage in sufficient quantity to motivate reform. But outrage is cheap and in surplus on many issues of less importance.

  2. bruce wilder

    Capitalism may be a series of moral catastrophes, motivating enslavement, brutal conquest and dispossession as well as many instances of petty frauds, addictions and poisonings, but I do not think it is possible to cleanly separate the moral plague of capitalism from industrialization. Industrialization is a process of social and political development in which capital as money finance has mobilized the organization of new ways of producing and distributing goods and services around the application of scientific technological knowledge and the use of fossil fuels. Money finance has enabled the fine calculation of costs and prospects even where the projects have been public investments by the state in education and infrastructure.
    I cannot let my own profession of economics off the hook for its achievements on behalf of agnatology. Economics has indoctrinated millions of college students in a fever dream of competitive market economy, leaving in shadow the development of vast private and public bureaucracy to organize economic processes. Even less attention is given in theory to the critical role of fossil fuels in the building and operating of modern economies.
    Now, if the earth’s ecology is to be saved from collapse, we have to conceive not how the past might have followed a different path, but how we can pioneer a path forward, and I do not think even the majority of thoughtful people considering the problems of overpopulation, resource depletion, “global warming”, additions to the carbon cycle and so on, have the first clue. Economists had us all debating carbon taxes versus cap-n-trade for thirty-plus years with no results or even insight to show for it. Ditto for “tragedy of the commons” concepts. It is uncommon in my observation for commentators to even acknowledge that radical conservation of energy would be necessary to meet even lenient global warming goals.

    The use of fossil fuels is central to industrialization and the bureaucratic economy, with and without “capitalism”. Money? Harder to say how to keep score in an economy beyond the rather obvious point that rewarding frauds, monopoly exploitation, usury and train derailments does not make winning the game pay off for the larger society.

  3. Eric Anderson

    All I’d like to say on this is that the entire theory of the “profits” that flow from capital accumulations is the greatest trick the devil ever pulled. Account for the negative externalities and the profit “margin” falls to something resembling nothing.
    The trick is that we’ve been fooled by economists into looking past it. That it’s the “cost of doing business.” Bullshit. Just taking climate change as an example, it’s the cost of doing humanity.

    In that vein, I’ve been reading two fascinating economists of late.
    1. Philip Mirowski. Check out “More Heat Than Light. Economics as Social Physics: Physics as Nature’s Economics” (1989). Ka-BOOM! [which is the sound of my head exploding as I read just about every paragraph in that book].
    2. David Ellerman. “The Labour Theory of Property and Marginal Productivity Theory” (2016). Again, wear a helmet to keep your skull together.

    You’ll walk away understanding that orthodox economic theory supporting the edifice that is capitalism is a house of cards supported only by ivory (ivy league?) tower lies.

    The only economy is the relatively stable state that is the earth’s economy. The only fluctuations are those naturally occurring perturbances that we should be prepared to face as they occur naturally.

    God we make this all so difficult in an effort to rationalize why some select group of people get an outsized share of living.

  4. anon y'mouse

    making the same mistakes as in the past would include nearly your entire list on the post of “we know what the solutions are”.

    all of that stuff will just further entrench the problem of using too many resources, with end products under limited control of those who can amass capital enough for such complicated “solutions”.

    vertical farming and electric vehicles and biomass burners (because that’s what it will be, behind the ultra variable and place-specific wind and solar farms unless you want to go full nuclear when we can’t even guarantee clean water for human consumption currently) are laughable “solutions” on a planet of 8 billion that have been totally immersed in capitalism as its religio-moral system for hundreds, if not thousands of years. they are also incredibly wasteful “solutions” simply based on inputs and outputs. sadly, nature does things better, easier and more “efficiently” in nearly all cases. just not for 8 billion mouths and asses doing what they are designed for.

  5. anon y'mouse

    oh, and i have always found it highly debatable whether it is “cheaper” to own rather than rent labor.

    if you own it, you are responsible for it for EVERYthing. try affording one single horse, it’s feed and care. then realize you need to do that for tens and hundreds of people for their entire lives. it’s only “cheap” if you have a lot of land and are growing up an entire economy of linked production facilities, thus limiting all money exchanges and making them live off what they are producing.

    you still have to make sure they are taken care of properly, and calling the doctor when they are ill.

    whereas, with rented labor you provide nothing except the workplace and instruments of production. you don’t provide food, housing, clothing, nor medical care. some other capitalist can provide those and if the people are sick or die, you replace them. a slave owner would have gone broke pretty fast doing that.

    hence, the self-excusing of slave owners with their sick paternalism, which is a mirror image of the old aristos of Euroland. “but we take care of them!” —>unstated assumption “better than they could do themselves/because they can’t do for themselves”.

  6. Ché Pasa

    I’m convinced that capitalism as we know it could not have begun without the looting of gold and silver from the Americas and the kidnapping of black bodies from Africa.

    Pillage, genocide, immiseration and enslavement and social/political mayhem lie at the foundation of capitalism, and see them all play out today. The capitalist system cannot exist without them. I would say the same for the pretend “democracy” that serves as the outward form of government in the capitalist West.

    All kinds of thinkers and doers have tried to come up with alternative economic and political organizing principles but success has been elusive at best. Perhaps the closest to success was the Northern European democratic socialist period which now, sadly, has closed as finance capitalism has pretty much taken over.

    What’s so appealing about it? I don’t understand. It’s based on theft, enslavement and misery. Why would anyone want to be part of it? It makes no sense, but here we are.

  7. David B Harrison

    The elephant in the room is the 24 hour a day propaganda jammed into our brains by the Micimatt. Starting from birth to death it is incessant. A person without true critical thinking skills can’t defend themselves against this constant barrage. The cure is literally turning it off (no cable or broadcast tv) developing true critical thing skills( starting with realizing your own biases and blind spots). You can’t change the world without changing yourself first.

  8. Willy

    Trump is visiting the train wreck scene in Ohio. In a better world, he’d have to escape back into his limo after encountering an angry mob armed with many stones. Perhaps pitchforks and torches too. But we’re living in this world. Now considering such a world, I’d ask any experienced ethical economists to help us figure out a better way.

  9. different clue

    ” What’s so appealing about it? I don’t understand. It’s based on theft, enslavement and misery. Why would anyone want to be part of it? It makes no sense, but here we are.

    FEBRUARY 22, 2023 ” . . .

    Well, it is certainly appealing to someone who would like to be a thief, an enslaver, and/or a misery-inflicter.

    Who does the saying ” you can’t make an omelette without breaking eggs” appeal to?
    Not the designated eggs. Maybe not even the designated omelette, if the omelette thinks about what its ultimate fate is. The self-designated chef and the self-designated happy customer support that saying.

  10. anon y'mouse

    if you want to design a better system, you are going to have to consider this fact which seems to be prevalent in all settled societies known all over the world—specialization leads to stratification, and surplus allows for both.

    it works in tandem with your “being an elite should not entitle you to a difference in quality in anything of importance”.

    i am watching a “master class” on pre-columbian civilizations of the americas. as soon as people settle down and stop migrating, and usually start partially relying on agriculture, societies start to become stratified as a means of organization of public works, trade networks and managing the surplus.

    you’ve got societies even here where all the fancy artifacts coalesce up to the top groups. it’s going to be difficult to convince me that, although the difference between an elite Cahokian’s lifestyle and a commoners were not significantly different because they lacked the means, that the fancy things they had did not also represent qualitatively different lives in some meaningful dimensions.

    Cahokia has evidence of mass sacrificial victims taken from a nearby place (mostly malnourished women who possibly worked as weavers in a village nearby) being buried under elites on biers of some sort. even in death, in a low tech society with not much stratification possible in living conditions, the poor and unfortunate are “stepped upon”.

    how do you solve for that? why do people who do different types of work start giving themselves a higher relative value than people who do other kinds of work? and i am immune to this, because those who work in high finance or health insurance denying claims are “the lowest of the low” to me. but i am worse (less useful) than a worm to them, so the feeling is possibly mutual.

  11. anon y'mouse

    amend the above with “i am NOT immune to this”.

  12. GlassHammer

    My very rudimentary understanding of capitalism is that it began as a means of creating consistent surpluses as a response to Europes little iceage. As far as I can tell the creation of surpluses has been one of the more consistent features of capitalism throughout history.

    The problem I see with overturning capitalism is that society isn’t ready to exist in a world without surpluses a world where inputs to outputs is closer to 1 to 1.

  13. Art

    16th and 17th centuries saw workers objecting to an hourly wage. The term ‘wage slavery’ was used. An alternative was a matter of shares. The most complete system was, perhaps, seen with sailors. Sailors often got one share, The captain five. A trained gunner two. Ship’ bay, half a share. Amounts varied and were negotiable. Heroic action could see you getting more shares. Cowardly behavior or failure of duty, fewer. The crew usually had a vote. A limited democracy. At the end of a voyage shares were handed out.

    IMHO the biggest issues with modern capitalism that come to mind are:
    The creation of corporations with limited liability. Ass to kick or soul to damn.

    The corporate demand not just for profit, but for ever increasing profits. No system can be stable or consistently productive over time if over-driven.

  14. bruce wilder

    upon reflection this thread seems to me to have descended into pointless fatuousness, more thoughtless than thoughtful

    so proud of your critical thinking skills, you cannot turn around and imagine anything positive about building the modern world?

    everything contaminated with the original sins of capitalism?

    stoning Trump in East Palestine? that is your fantasy? why? because Biden is in Ukraine provoking wwiii and you voted for old coot as the lesser evil?

    I am done here.

  15. Willy

    pointless fatuousness

    Welcome to human nature.

    I once stated that at the very least, we could go back (to a still messy but better run time we knew as the New Deal age). You said no, we cannot go back. I believe I asked “Why?” I received no answer.

    So do we have to just allow private equity firms to decimate corporations until they ‘need’ immigrant child labor, leading to a repeat of hitting bottom with Pinkertons, Teddy, and Hitler all over again?

    And once again I repeat: Everything depends on what the mob believes they want and not what a handful of “critical thinkers” thinks they want. Or maybe “feels” is a better word.

  16. Willy

    I was once acquainted with an independent realtor trying the ethical route with his own startup brokerage company. This was back in the mid 80’s during the Bob Vila home improvement age when “This Old House” fixer properties abounded in my city.

    So many opportunities for first-time home buyers at whatever level, provided they knew what they were getting themselves into. That realtor’s tagline was “The Educators”. He and his would as part of the home buyers experience, offer honest knowledge, pamphlets and even published books. I thought it a slam dunk of a business opportunity and later kicked myself for having not gotten on board such a timely-clever idea.

    But there was another realtor company which chose a different route. They named themselves after a wealthy local neighborhood and their tagline was “Exclusively”.
    After many years the independent realtor retired from his one branch. The “exclusive” company today has thousands of branches throughout the west.

    This is my best analogy today to explain my perception of the way that the human mob thinks, of what it is that best influences the human mob. Sometimes it’s sucky to be the smart one. I agree, it’s fun to play in an ivory tower of one’s own creation. It’s fun to imagine we can transform the world with our exceptional knowledge and ethicality and sense of self-importance to become “The Educators”.

    But then the realities of human mob psychology always has to fucking intervene.

  17. anon y'mouse

    Willy, i think put his(?) finger on the pulse.

    we can come up with all kinds of solutions. but the technologies (or lack thereof–seriously, what if the most “sustainable” life is living in a mud hut collecting acorns?) are not the problem.

    the lack of any ability to change what we have is, based on the power structure.

    it’s going to seriously “harsh some mellows” if those many millions of us are induced to live a “low carbon footprint” lifestyle just so Bezos can prove yet again that gravity works, and that his penis does also.

    and that’s what would be done with any “budget” that we create—the powerful will use it to continue doing what they do for their own ends. the rest of us are just tools.

    if someone wants to live ecologically-ethically because they think they should, and they get psychological payback for building up their credits in the Carbon Use Heaven, that’s fine. but it will all be for nought if people like Melon Husk gets his way. and he seems to be on multiple inside tracks to do just that.

    also, the related point that Willy also touches upon which does frustrate me—we can’t even have a rational discussion about possible solutions because that class of people who actually own and run things has polluted the discourse with fantasies of carbon credits, “decoupling GDP” and basically moving to an even higher level of technology (which will only increase the energy requirements of the world). they have been generating THEIR solutions for multiple decades now, and don’t intend to lose control or stop benefitting.

    so what if we go whole hog on the Vertical Farms solution to agriculture, or any other solution that looks likely? we don’t really know if these things would be worse or better (i say worse, some say better. smart people on both sides make arguments) and our whole discourse is polluted by these kinds of solutions which have been strategized by oligarch funded think tanks to make sure that they can continue to profit off of them and the rest of us.

    and they will employ anything they can get away with by selling it to us. that’s why when people start coming up with “solutions” it’s always the same list of things that are, as far as my limited ability to research allows, really not any “better” and usually require some deus ex machina, if they aren’t just outright fantasay accounting frauds.

    yeah, and none of us has any power to get the solutions (whatever they may turn out to be) implemented. but definitely not the “right” ones with rich people running everything.

    i have tried to walk the walk in my own life much more than many/most people. it was not easy and some of it was by financial necessity, and you know what–it sucked and it put me at a disadvantage to everyone else even though i “had” to accept that solution often. i didn’t even want to drive a personal automobile, and have lived in multiple places that allowed me to not have to. but it was both because i couldn’t afford to and felt uncomfortable taking other people’s lives into my shaky hands.

    and it sucked. i spent hours and hours of my life waiting on buses and trains for multiple decades that would take me in the wrong direction from my destination, all to meet up with the one line that would take me 1/2 mile close to where i needed to go. hours of my life i will never get back, and all without a babyminder cell phone to distract me (and actually, in places where it would not pay to be distracted as you might get jumped).

    i lived over 2.5 decades as an ethical vegetarian, until my body did not want any more beans and grains and wouldn’t absorb enough vitamins that way and complained about being fed that way. age can do that to you, regardless of any choice by you.

    so hopefully no one accuses me of harshing any mellows because i just love how the world currently is and want it to continue on that way. i don’t like fake solutions being promulgated by those on high who have already figured out a way to profit from gullible but well meaning people who desperately want a solution. it’s yet another advantage those jackoffs are taking.

    no offense meant to any particular persons here.

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