by DGR News Service | Sep 19, 2021 | Agriculture, Repression at Home, Strategy & Analysis
This article originally appeared in Climate & Capitalism. It is part 2 of a series, read part 1 here.
Featured image: Tenants harvest the landlord’s grain
“The expropriation of the mass of the people from the soil forms the basis of the capitalist mode of production.” (Karl Marx)
by Ian Angus
“The ground of the parish is gotten up into a few men’s hands, yea sometimes into the tenure of one or two or three, whereby the rest are compelled either to be hired servants unto the other or else to beg their bread in misery from door to door.” (William Harrison, 1577)[1]
In 1549, tens of thousands of English peasants fought — and thousands died — to halt and reverse the spread of capitalist farming that was destroying their way of life. The largest action, known as Kett’s Rebellion, has been called “the greatest practical utopian project of Tudor England and the greatest anticapitalist rising in English history.”[2]
On July 6, peasants from Wymondham, a market town in Norfolk, set out across country to tear down hedges and fences that divided formerly common land into private farms and pastures. By the time they reached Norwich, the second-largest city in England, they had been joined by farmers, farmworkers and artisans from many other towns and villages. On July 12, as many as 16,000 rebels set up camp on Mousehold Heath, near the city. They established a governing council with representatives from each community, requisitioned food and other supplies from nearby landowners, and drew up a list of demands addressed to the king.
Over the next six weeks, they twice invaded and captured Norwich, repeatedly rejected Royal pardons on the grounds that they had done nothing wrong, and defeated a force of 1,500 men sent from London to suppress them. They held out until late August, when they were attacked by some 4,000 professional soldiers, mostly German and Italian mercenaries, who were ordered by the Duke of Warwick to “take the company of rebels which they saw, not for men, but for brute beasts imbued with all cruelty.”[3] Over 3,500 rebels were massacred, and their leaders were tortured and beheaded.
The Norwich uprising is the best documented and lasted longest, but what contemporaries called the Rebellions of Commonwealth involved camps, petitions and mass assemblies in at least 25 counties, showing “unmistakable signs of coordination and planning right across lowland England.”[4] The best surviving statement of their objectives is the 29 articles adopted at Mousehold Heath. They were listed in no particular order, but, as historian Andy Wood writes, “a strong logic underlay them.”
“The demands drawn up at the Mousehold camp articulated a desire to limit the power of the gentry, exclude them from the world of the village, constrain rapid economic change, prevent the over-exploitation of communal resources, and remodel the values of the clergy. … Lords were to be excluded from common land and prevented from dealing in land. The Crown was asked to take over some of the powers exercised by lords, and to act as a neutral arbiter between lord and commoner. Rents were to be fixed at their 1485 level. In the most evocative phrase of the Norfolk complaints, the rebels required that the servile bondmen who still performed humiliating services upon the estates of the Duchy of Lancaster and the former estates of the Duke of Norfolk be freed: ‘We pray that all bonde men may be made Free, for god made all Free with his precious blode sheddyng’.”[5]
The scope and power of the rebellions of 1549 demonstrate, as nothing else can, the devastating impact of capitalism on the lives of the people who worked the land in early modern England. The radical changes known to history by the innocuous label enclosure peaked in two long waves: during the rise of agrarian capitalism in the sixteenth and seventeenth centuries, and during the consolidation of agrarian capitalism in the eighteenth and nineteenth.
This article discusses the sixteenth century origins of what Marx called “the systematic theft of communal property.”[6]
Sheep devour people
In part one we saw that organized resistance and reduced population allowed English peasants to win lower rents and greater freedom in the 1400s. But they didn’t win every fight — rather than cutting rents and easing conditions to attract tenants, some landlords forcibly evicted their smaller tenants and leased larger farms, at increased rents, to well-off farmers or commercial sheep graziers. Caring for sheep required far less labor than growing grain, and the growing Flemish cloth industry was eager to buy English wool.
Local populations declined as a result, and many villages disappeared entirely. As Sir Thomas More famously wrote in 1516, sheep had “become so greedy and fierce that they devour human beings themselves. They devastate and depopulate fields, houses and towns.”[7]
For more than a century, enclosure and depopulation — the words were almost always used together — were major social and political concerns for England’s rulers. As early as 1483, Edward V’s Lord Chancellor, John Russell, criticized “enclosures and emparking … [for] driving away of tenants and letting down of tenantries.”[8] In the same decade, the priest and historian John Rous condemned enclosure and depopulation, and identified 62 villages and hamlets within 12 miles of his home in Warwickshire that were “either destroyed or shrunken,” because “lovers or inducers of avarice” had “ignominiously and violently driven out the inhabitants.” He called for “justice under heavy penalties” against the landlords responsible.[9]
Thirty years later, Henry VIII’s advisor Sir Thomas More condemned the same activity, in more detail.
“The tenants are ejected; and some are stripped of their belongings by trickery or brute force, or, wearied by constant harassment, are driven to sell them. One way or another, these wretched people — men, women, husbands, wives, orphans, widows, parents with little children and entire families (poor but numerous, since farming requires many hands) — are forced to move out. They leave the only homes familiar to them, and can find no place to go. Since they must have at once without waiting for a proper buyer, they sell for a pittance all their household goods, which would not bring much in any case. When that little money is gone (and it’s soon spent in wandering from place to place), what finally remains for them but to steal, and so be hanged — justly, no doubt — or to wander and beg? And yet if they go tramping, they are jailed as idle vagrants. They would be glad to work, but they can find no one who will hire them. There is no need for farm labor, in which they have been trained, when there is no land left to be planted. One herdsman or shepherd can look after a flock of beasts large enough to stock an area at used to require many hands to make it grow crops.”[10]
Many accounts of the destruction of commons-based agriculture assume that that enclosure simply meant the consolidation of open-field strips into compact farms, and planting hedges or building fences to demark the now-private property. In fact, as the great social historian R.H. Tawney pointed out in his classic study of The Agrarian Problem in the Sixteenth Century, in medieval and early modern England the word enclosure “covered many different kinds of action and has a somewhat delusive appearance of simplicity.”[11] Enclosure might refer to farmers trading strips of manor land to create more compact farms, or to a landlord unilaterally adding common land to his demesne, or to the violent expulsion of an entire village from land their families had worked for centuries.
Even in the middle ages, tenant farmers had traded or combined strips of land for local or personal reasons. That was called enclosure, but the spatial rearrangement of property as such didn’t affect common rights or alter the local economy.[12] In the sixteenth century, opponents of enclosure were careful to exempt such activity from criticism. For example, the commissioners appointed to investigate illegal enclosure in 1549 received this instruction:
“You shall enquire what towns, villages, and hamlets have been decayed and laid down by enclosures into pastures, within the shire contained in your instructions …
“But first, to declare unto you what is meant by the word enclosure. It is not taken where a man encloses and hedges his own proper ground, where no man has commons, for such enclosure is very beneficial to the commonwealth; it is a cause of great increase of wood: but it is meant thereby, when any man has taken away and enclosed any other men’s commons, or has pulled down houses of husbandry, and converted the lands from tillage to pasture. This is the meaning of this word, and so we pray you to remember it.”[13]
As R.H. Tawney wrote, “What damaged the smaller tenants, and produced the popular revolts against enclosure, was not merely enclosing, but enclosing accompanied by either eviction and conversion to pasture, or by the monopolizing of common rights. … It is over the absorption of commons and the eviction of tenants that agrarian warfare — the expression is not too modern or too strong — is waged in the sixteenth century.”[14]
An unsuccessful crusade
Tudor Monarchs
| Henry VII |
1485–1509 |
| Henry VIII |
1509–1547 |
| Edward VI |
1547–1553 |
| Mary I |
1553–1558 |
| Elizabeth I |
1558–1603 |
The Tudor monarchs who ruled England from 1485 to 1603 were unable to halt the destruction of the commons and the spread of agrarian capitalism, but they didn’t fail for lack of trying. A general Act Against Pulling Down of Towns was enacted in 1489, just four years after Henry VII came to power. Declaring that “in some towns two hundred persons were occupied and lived by their lawful labours [but] now two or three herdsmen work there and the rest are fallen in idleness,”[15] the Act forbade conversion of farms of 20 acres or more to pasture, and ordered landlords to maintain the existing houses and buildings on all such farms.
Further anti-enclosure laws were enacted in 1515, 1516, 1517, 1519, 1526, 1534, 1536, 1548, 1552, 1555, 1563, 1589, 1593, and 1597. In the same period, commissions were repeatedly appointed to investigate and punish violators of those laws. The fact that so many anti-enclosure laws were enacted shows that while the Tudor government wanted to prevent depopulating enclosure, it was consistently unable to do so. From the beginning, landlords simply disobeyed the laws. The first Commission of Enquiry, appointed in 1517 by Henry VIII’s chief advisor Thomas Wolsey, identified 1,361 illegal enclosures that occurred after the 1489 Act was passed.[16] Undoubtedly more were hidden from the investigators, and even more were omitted because landlords successfully argued that they were formally legal.[17]
The central government had multiple reasons for opposing depopulating enclosure. Paternalist feudal ideology played a role — those whose wealth and position depended on the labor of the poor were supposed to protect the poor in return. More practically, England had no standing army, so the king’s wars were fought by peasant soldiers assembled and led by the nobility, but evicted tenants would not be available to fight. At the most basic level, fewer people working the land meant less money collected in taxes and tithes. And, as we’ll discuss in Part Three, enclosures caused social unrest, which the Tudors were determined to prevent.
Important as those issues were, for a growing number of landlords they were outweighed by their desire to maintain their income in a time of unprecedented inflation, driven by debasement of the currency and the influx of plundered new world silver. “During the price revolution of the period 1500-1640, in which agricultural prices rose by over 600 per cent, the only way for landlords to protect their income was to introduce new forms of tenure and rent and to invest in production for the market.”[18]
Smaller gentry and well-off tenant farmers did the same, in many cases more quickly than the large landlords. The changes they made shifted income from small farmers and farmworkers to capitalist farmers, and deepened class divisions in the countryside.
“Throughout the sixteenth century the number of smaller lessees shrank, while large leaseholding, for which accumulated capital was a prerequisite, became increasingly important. The sixteenth century also saw the rise of the capitalist lessee who was prepared to invest capital in land and stock. The increasing divergence of agricultural prices and wages resulted in a ‘profit inflation’ for capitalist farmers prepared and able to respond to market trends and who hired agricultural labor.”[19]
As we’ve seen, the Tudor government repeatedly outlawed enclosures that removed tenant farmers from the land. The laws failed because enforcement depended on justices of the peace, typically local gentry who, even if they weren’t enclosers themselves, wouldn’t betray neighbors and friends who were. Occasional Commissions of Enquiry were more effective — and so were hated by landlords — but their orders to remove enclosures and reinstate former tenants were rarely obeyed, and fines could be treated as a cost of doing business.
From monks to investors
The Tudors didn’t just fail to halt the advance of capitalist agriculture, they unintentionally gave it a major boost. As Marx wrote, “the process of forcible expropriation of the people received a new and terrible impulse in the sixteenth century from the Reformation, and the consequent colossal spoliation of church property.”[20]
Between 1536 and 1541, seeking to reform religious practice and increase royal income, Henry VIII and his chief minister Thomas Cromwell disbanded nearly 900 monasteries and related institutions, retired their occupants, and confiscated their lands and income.
This was no small matter — together, the monasteries’ estates comprised between a quarter and a third of all cultivated land in England and Wales. If he had kept it, the existing rents and tithes would have tripled the king’s annual income. But in 1543 Henry, a small-country king who wanted to be a European emperor, launched a pointless and very expensive war against Scotland and France, and paid for it by selling off the properties he had just acquired. When Henry died in 1547, only a third of the confiscated monastery property remained in royal hands; almost all that remained was sold later in the century, to finance Elizabeth’s wars with Spain.[21]
The sale of so much land in a short time transformed the land market and reshaped classes. As Christopher Hill writes, “In the century and a quarter after 1530, more land was bought and sold in England than ever before.”
“There was relatively cheap land to be bought by anyone who had capital to invest and social aspirations to satisfy…. By 1600 gentlemen, new and old, owned a far greater proportion of the land of England than in 1530 — to the disadvantage of crown, aristocracy and peasantry alike.
“Those who acquired land in significant quantity became gentlemen, if they were not such already … Gentlemen leased land — from the king, from bishops, from deans and chapters, from Oxford and Cambridge colleges — often in order to sub-let at a profit. Leases and reversions sometimes lay two deep. It was a form of investment…. The smaller gentry gained where big landlords lost, gained as tenants what others lost as lords.”[22]
As early as 1515, there were complaints that farmland was being acquired by men not from the traditional landowning classes — “merchant adventurers, clothmakers, goldsmiths, butchers, tanners and other artificers who held sometimes ten to sixteen farms apiece.”[23] When monastery land came available, owning or leasing multiple farms, known as engrossing, became even more attractive to urban businessmen with capital to spare. Some no doubt just wanted the prestige of a country estate, but others, used to profiting from their investments, moved to impose shorter leases and higher rents, and to make private profit from common land.
A popular ballad of the time expressed the change concisely:
“We have shut away all cloisters,
But still we keep extortioners.
We have taken their land for their abuse,
But we have converted them to a worse use.”[24]
Hysterical exaggeration?
Early in the 1900s, conservative economist E.F. Gay — later the first president of the Harvard Business School — wrote that 16th century accounts of enclosure were wildly exaggerated. Under the influence of “contemporary hysterics” and “the excited sixteenth century imagination,” a small number of depopulating enclosures were “magnified into a menacing social evil, a national calamity responsible for dearth and distress, and calling for drastic legislative remedy.” Popular opposition reflected not widespread hardship, but “the ignorance and hide-bound conservatism of the English peasant,” who combined “sturdy, admirable qualities with a large admixture of suspicion, cunning and deceit.” [25]
Gay argued that the reports produced by two major commissions to investigate enclosures show that the percentage of enclosed land in the counties investigated was just 1.72% in 1517 and 2.46% in 1607. Those small numbers “warn against exaggeration of the actual extent of the movement, against an uncritical acceptance of the contemporary estimate both of the greatness and the evil of the first century and a half of the ‘Agrarian Revolution.’”[26]
Ever since, Gay’s argument has been accepted and repeated by right-wing historians eager to debunk anything resembling a materialist, class-struggle analysis of capitalism. The most prominent was Cambridge University professor Sir Geoffrey Elton, whose bestselling book England Under the Tudors dismissed critics of enclosure as “moralists and amateur economists” for whom landlords were convenient scapegoats. Despite the complaints of such “false prophets,” enclosers were just good businessmen who “succeeded in sharing the advantages which the inflation offered to the enterprising and lucky.” And even then, “the whole amount of enclosure was astonishingly small.”[27]
The claim that enclosure was an imaginary problem is improbable, to say the least. R.H. Tawney’s 1912 response to Gay applies with full force to Elton and his conservative co-thinkers.
“To suppose that contemporaries were mistaken as to the general nature of the movement is to accuse them of an imbecility which is really incredible. Governments do not go out of their way to offend powerful classes out of mere lightheartedness, nor do large bodies of men revolt because they have mistaken a ploughed field for a sheep pasture.”[28]
The reports that Gay analyzed were important, but far from complete. They didn’t cover the whole country (only six counties in 1607), and their information came from local “jurors” who were easily intimidated by their landlords. Despite the dedication of the commissioners, it is virtually certain that their reports understated the number and extent of illegal enclosures.
And, as Tawney pointed out, enclosure as a percentage of all land doesn’t tell us much about its economic and social impact — the real issue is how much farmed land was enclosed.
In 1979, John Martin reanalysed Gay’s figures for the most intensely farmed areas of England, the ten Midlands counties where 80% of all enclosures took place. He concluded that in those counties over a fifth of cultivated land had been enclosed by 1607, and that in two counties enclosure exceeded 40%. Contrary to Elton’s claim, those are not “astonishingly small” figures — they support Martin’s conclusion that “the enclosure movement must have had a fundamental impact upon the agrarian organization of the Midlands peasantry in this period.” [29]
It’s important to bear in mind that enclosure, as narrowly defined by Tudor legislation and Inquiry commissions, was only part of the restructuring that was transforming rural life. W.G, Hoskins emphasizes that in The Age of Plunder:
“The importance of engrossing of farms by bigger men was possibly a greater social problem than the much more noisy controversy over enclosures, if only because it was more general. The enclosure problem was largely confined to the Midlands … but the engrossing of farms was going on all the time all over the country.”[30]
George Yerby elaborates.
“Enclosure was one manifestation of a broader and less formal development that was working in exactly the same direction. The essential basis of the change, and of the new economic balance, was the consolidation of larger individual farms, and this could take place with or without the technical enclosure of the fields. This also serves to underline the force of commercialization as the leading trend in changes in the use and occupation of the land during this period, for the achievement of a substantial marketable surplus was the incentive to consolidate, and it did not always require the considerable expense of hedging.”[31]
More large farms meant fewer small farms, and more people who had no choice but to work for others. The twin transformations of primitive accumulation — stolen land becoming capital and landless producers becoming wage workers — were well underway.
Notes
[1] William Harrison, The Description of England: The Classic Contemporary Account of Tudor Social Life, ed. Georges Edelen (Folger Shakespeare Library, 1994), 217.
[2] Jim Holstun, “Utopia Pre-Empted: Ketts Rebellion, Commoning, and the Hysterical Sublime,” Historical Materialism 16, no. 3 (2008), 5.
[3] Quoted in Martin Empson, Kill All the Gentlemen: Class Struggle and Change in the English Countryside (Bookmarks Publications, 2018), 162.
[4] Diarmaid MacCulloch and Anthony Fletcher, Tudor Rebellions, 6th ed. (Routledge, 2016), 70.
[5] Andy Wood, Riot, Rebellion and Popular Politics in Early Modern England (Palgrave, 2002), 66-7.
[6] Karl Marx, Capital, Vol. 1, (Penguin Books, 1976), 886.
[7] Thomas More, Utopia, trans. Robert M. Adams, ed. George M. Logan, 3rd ed. (Cambridge University Press, 2016), 19.
[8] A. R. Myers, ed., English Historical Documents, 1327-1485, vol. 4 (Routledge, 1996), 1031. “Emparking” meant converting farmland into private forests or parks, where landlords could hunt.
[9] Ibid., 1029.
[10] More, Utopia, 19-20.
[11] R. H. Tawney, The Agrarian Problem in the Sixteenth Century (Lector House, 2021 [1912]), 7.
[12] Tawney, Agrarian Problem, 110.
[13] R. H. Tawney and E. E. Power, eds., Tudor Economic Documents, Vol. 1. (Longmans, Green, 1924), 39, 41. Spelling modernized.
[14] Tawney, Agrarian Problem, 124, 175.
[15] Quoted in M. W. Beresford, “The Lost Villages of Medieval England,” The Geographical Journal 117, no. 2 (June 1951), 132. Spelling modernized.
[16] Spencer Dimmock, “Expropriation and the Political Origins of Agrarian Capitalism in England,” in Case Studies in the Origins of Capitalism, ed. Xavier Lafrance and Charles Post (Palgrave MacMillan, 2019), 52.
[17] The Statute of Merton, enacted in 1235, allowed landlords to take possession of and enclose common land, so long as sufficient remained to meet customary tenants’ rights. In the 1500s that long-disused law provided a loophole for enclosing landlords who defined “sufficient” as narrowly as possible.
[18] Martin, Feudalism to Capitalism, 131.
[19] Martin, Feudalism to Capitalism, 133.
[20] Marx, Capital, Vol. 1, 883.
[21] Perry Anderson, Lineages of the Absolutist State (Verso, 1979), 124-5.
[22] Christopher Hill, Reformation to Industrial Revolution: A Social and Economic History of Britain, 1530-1780 (Weidenfeld & Nicolson, 1967), 47-8.
[23] Joan Thirsk, “Enclosing and Engrossing, 1500-1640,” in Agricultural Change: Policy and Practice 1500-1750, ed. Joan Thirsk (Cambridge University Press, 1990), 69.
[24] Quoted in Thomas Edward Scruton, Commons and Common Fields (Batoche Books, 2003 [1887]), 73.
[25] Edwin F. Gay, “Inclosures in England in the Sixteenth Century,” The Quarterly Journal of Economics 17, no. 4 (August 1903), 576-97; “The Inclosure Movement in England,” Publications of the American Economic Association 6, no. 2 (May 1905), 146-159.
[26] Edwin F. Gay, “The Midland Revolt and the Inquisitions of Depopulation of 1607,” Transactions of the Royal Historical Society 18 (1904), 234, 237.
[27] G. R. Elton, England under the Tudors (Methuen, 1962), 78-80.
[28] Tawney, Agrarian Problem, 166.
[29] John E. Martin, Feudalism to Capitalism: Peasant and Landlord in English Agrarian Development (Macmillan Press, 1986), 132-38.
[30] W. G. Hoskins, The Age of Plunder: The England of Henry VIII 1500-1547, Kindle ed. (Sapere Books, 2020 [1976]), loc. 1256.
[31] George Yerby, The Economic Causes of the English Civil War (Routledge, 2020), 48.
by DGR News Service | Sep 18, 2021 | Agriculture, Repression at Home, Strategy & Analysis, Worker Exploitation
This article originally appeared in Climate & Capitalism.
Featured image: Harvesting grain in the 1400s
Editor’s note: We are no Marxists, but we find it important to look at history from the perspective of the usual people, the peasants, and the poor, since liberal historians tend to follow the narrative of endless progress and neglect all the violence and injustice this “progress” was and is based on. Garrett Hardin’s annoying but very influential essay “The Tragedy of the Commons” is a good example, and we are thankful to the author for debunking it.
“All progress in capitalist agriculture is a progress in the art, not only of robbing the worker, but of robbing the soil.” (Karl Marx)
Articles in this series:
Commons and classes before capitalism
‘Systematic theft of communal property’
Against Enclosure: The Commonwealth Men
Dispossessed: Origins of the Working Class
Against Enclosure: The Commoners Fight Back
by Ian Angus
To live, humans must eat, and more than 90% of our food comes directly or indirectly from soil. As philosopher Wendell Berry says, “The soil is the great connector of lives…. Without proper care for it we can have no community, because without proper care for it we can have no life.”[1]
Preventing soil degradation and preserving soil fertility ought to be a global priority, but it isn’t. According to the United Nations, a third of the world’s land is now severely degraded, and we lose 24 billion tonnes of fertile soil every year. More than 1.3 billion people depend on food from degraded or degrading agricultural land.[2] Even in the richest countries, almost all food production depends on massive applications of synthetic fertilizers and pesticides that further degrade the soil and poison the environment.
In Karl Marx’s words, “a rational agriculture is incompatible with the capitalist system.”[3] To understand why that is, we need to understand how capitalist agriculture emerged from a very different system.
****
For almost all of human history, almost all of us lived and worked on the land. Today, most of us live in cities.
It is hard to overstate how radical that change is, or how quickly it happened. Two hundred years ago, 90% of the world’s population was rural. Britain became the world’s first majority-urban country in 1851. As recently as 1960, two-thirds of the world’s people still lived in rural areas. Now it’s less than half, and only half of those are farmers.
Between the decline of feudalism and the rise of industrial capitalism, rural society was transformed by the complex of processes that are collectively known as enclosure. The separation of most people from the land, and the concentration of land ownership in the hands of a tiny minority, were revolutionary changes in the ways that humans lived and work. It happened in different ways and at different times in different parts of the world, and is still going on today.
Our starting point is England, where what Marx labelled “so-called primitive accumulation” first occurred.
Common Fields, Common Rights
In medieval and early-modern England, most people were poor, but they were also self-provisioning — they obtained their essential needs directly from the land, which was a common resource, not private property as we understand the concept.
No one actually knows when or how English common farming systems began. Most likely they were brought to England by Anglo-Saxon settlers after Roman rule ended. What we know for sure is that common field agriculture was widespread, in various forms, when English feudalism was at its peak in the twelfth and thirteenth centuries.
The land itself was held by landlords, directly or indirectly from the king. A minor gentry family might hold and live on just one manor — roughly equivalent to a township — while a top aristocrat, bishop or monastery could hold dozens. The people who actually worked the land, often including a mix of unfree serfs and free peasants, paid rent and other fees in labor, produce or (later) cash, and had, in addition to the use of arable land, a variety of legal and traditional rights to use the manor’s resources, such as grazing animals on common pasture, gathering firewood, berries and nuts in the manor forest, and collecting (gleaning) grain that remained in the fields after harvest.
“Common rights were managed, divided, and redivided by the communities. These rights were predicated on maintaining relations and activities that contributed to the collective reproduction. No feudal lord had rights to the land exclusive of such customary rights of the commoners. Nor did they have the right to seize or engross the common fields as their own domain.”[4]
Field systems varied a great deal, but usually a manor or township included both the landlord’s farm (demesne) and land that was farmed by tenants who had life-long rights to use it. Most accounts only discuss open field systems, in which each tenant cultivated multiple strips of land that were scattered through the arable fields so no one family had all the best soil, but there were other arrangements. In parts of southwestern England and Scotland, for example, farms on common arable land were often compact, not in strips, and were periodically redistributed among members of the commons community. This was called runrig; a similar arrangement in Ireland was called rundale.
Most manors also had shared pasture for feeding cattle, sheep and other animals, and in some cases forest, wetlands and waterways.
Though cooperative, these were not communities of equals. Originally, all of the holdings may have been about the same size but in time considerable economic differentiation took place.[5] A few well-to-do tenants held land that produced enough to sell in local markets; others (probably a majority in most villages) had enough land to sustain their families with a small surplus in good years; others with much less land probably worked part-time for their better-off neighbors or for the landlord. “We can see this stratification right across the English counties in Domesday Book of 1086, where at least one-third of the peasant population were smallholders. By the end of the thirteenth century this proportion, in parts of southeastern England, was over a half.”[6]
As Marxist historian Rodney Hilton explains, the economic differences among medieval peasants were not yet class differences. “Poor smallholders and richer peasants were, in spite of the differences in their incomes, still part of the same social group, with a similar style of life, and differed from one to the other in the abundance rather than the quality of their possessions.”[7] It wasn’t until after the dissolution of feudalism in the fifteenth century that a layer of capitalist farmers developed.
Self-Management
If we were to believe an influential article published in 1968, commons-based agriculture ought to have disappeared shortly after it was born. In “The Tragedy of the Commons,” Garrett Hardin argued that commoners would inevitably overuse resources, causing ecological collapse. In particular, in order to maximize his income, “each herdsman will try to keep as many cattle as possible on the commons,” until overgrazing destroys the pasture, and it supports no animals at all. “Freedom in a commons brings ruin to all.”[8]
Since its publication in 1968, Hardin’s account has been widely adopted by academics and policy makers, and used to justify stealing indigenous peoples’ lands, privatizing health care and other social services, giving corporations ‘tradable permits’ to pollute the air and water, and more. Remarkably, few of those who have accepted Hardin’s views as authoritative notice that he provided no evidence to support his sweeping conclusions. He claimed that “tragedy” was inevitable, but he didn’t show that it had happened even once.[9]
Scholars who have actually studied commons-based agriculture have drawn very different conclusions. “What existed in fact was not a ‘tragedy of the commons’ but rather a triumph: that for hundreds of years — and perhaps thousands, although written records do not exist to prove the longer era — land was managed successfully by communities.”[10]
The most important account of how common-field agriculture in England actually worked is Jeanette Neeson’s award-winning book, Commoners: Common Right, Enclosure and Social Change in England, 1700-1820. Her study of surviving manorial records from the 1700s showed that the common-field villagers, who met two or three times a year to decide matters of common interest, were fully aware of the need to regulate the metabolism between livestock, crops and soil.
“The effective regulation of common pasture was as significant for productivity levels as the introduction of fodder crops and the turning of tilled land back to pasture, perhaps more significant. Careful control allowed livestock numbers to grow, and, with them, the production of manure. … Field orders make it very clear that common-field villagers tried both to maintain the value of common of pasture and also to feed the land.”[11]
Village meetings selected “juries” of experienced farmers to investigate problems, and introduce permanent or temporary by-laws. Particular attention was paid to “stints” — limits on the number of animals allowed on the pasture, waste, and other common land. “Introducing a stint protected the common by ensuring that it remained large enough to accommodate the number of beasts the tenants were entitled to. It also protected lesser commoners from the commercial activities of graziers and butchers.”[12]
Juries also set rules for moving sheep around to ensure even distribution of manure, and organized the planting of turnips and other fodder plants in fallow fields, so that more animals could be fed and more manure produced. The jury in one of the manors that Neeson studied allowed tenants to pasture additional sheep if they sowed clover on their arable land — long before scientists discovered nitrogen and nitrogen-fixing, these farmers knew that clover enriched the soil.[13]
And, given present-day concerns about the spread of disease in large animal feeding facilities, it is instructive to learn that eighteenth century commoners adopted regulations to isolate sick animals, stop hogs from fouling horse ponds, and prevent outside horses and cows from mixing with the villagers’ herds. There were also strict controls on when bulls and rams could enter the commons for breeding, and juries “carefully regulated or forbade entry to the commons of inferior animals capable of inseminating sheep, cows or horses.”[14]
Neeson concludes, “the common-field system was an effective, flexible and proven way to organize village agriculture. The common pastures were well governed, the value of a common right was well maintained.”[15]
Commons-based agriculture survived for centuries precisely because it was organized and managed democratically by people who were intimately involved with the land, the crops and the community. Although it was not an egalitarian society, in some ways it prefigured what Karl Marx, referring to a socialist future, described as “the associated producers, govern[ing] the human metabolism with nature in a rational way.”[16]
Class Struggles
That’s not to say that agrarian society was tension free. There were almost constant struggles over how the wealth that peasants produced was distributed in the social hierarchy. The nobility and other landlords sought higher rents, lower taxes and limits on the king’s powers, while peasants resisted landlord encroachments on their rights, and fought for lower rents. Most such conflicts were resolved by negotiation or appeals to courts, but some led to pitched battles, as they did in 1215 when the barons forced King John to sign Magna Carta, and in 1381 when thousands of peasants marched on London to demand an end to serfdom and the execution of unpopular officials.
Historians have long debated the causes of feudalism’s decline: I won’t attempt to resolve or even summarize those complex discussions here.[17] Suffice it to say that by the early 1400s in England, the feudal aristocracy was much weakened. Peasant resistance had effectively ended hereditary serfdom and forced landlords to replace labor-service with fixed rents, while leaving common field agriculture and many common rights in place. Marx described the 1400s and early 1500s, when peasants in England were winning greater freedom and lower rents, as “a golden age for labor in the process of becoming emancipated.”[18]
But that was also a period when longstanding economic divisions within the peasantry were increasing. W.G. Hoskins described the process in his classic history of life in a Midland village.
“During the fifteenth and sixteenth centuries there emerged at Wigston what may be called a peasant aristocracy, or, if this is too strong a phrase as yet, a class of capitalist peasants who owned substantially larger farms and capital resources than the general run of village farmers. This process was going on all over the Midlands during these years …”[19]
Capitalist peasants were a small minority. Agricultural historian Mark Overton estimates that “in the early sixteenth century, around 80 per cent of farmers were only growing enough food for the needs of their family household.” Of the remaining 20%, only a few were actual capitalists who employed laborers and accumulated ever more land and wealth. Nevertheless, by the 1500s two very different approaches to the land co-existed in many commons communities.
“The attitudes and behavior of farmers producing exclusively for their own needs were very different from those farmers trying to make a profit. They valued their produce in terms of what use it was to them rather than for its value for exchange in the market. … Larger, profit orientated, farmers were still constrained by soils and climate, and by local customs and traditions, but also had an eye to the market as to which crop and livestock combinations would make them most money.”[20]
As we’ll see, that division eventually led to the overthrow of the commons.
Primitive Accumulation
For Marx, the key to understanding the long transition from agrarian feudalism to industrial capitalism was “the process which divorces the worker from the ownership of the conditions of his own labor,” which itself involved “two transformations … the social means of subsistence and production are turned into capital, and the immediate producers are turned into wage-laborers.”[21]
“Nature does not produce on the one hand owners of money or commodities, and on the other hand men possessing nothing but their own labor-power. This relation has no basis in natural history, nor does it have a social basis common to all periods of human history. It is clearly the result of a past historical development, the product of many economic revolutions, of the extinction of a whole series of older formations of social production.”[22]
A decade before Capital was published, Marx summarized that historical development in an early draft.
“It is … precisely in the development of landed property that the gradual victory and formation of capital can be studied. … The history of landed property, which would demonstrate the gradual transformation of the feudal landlord into the landowner, of the hereditary, semi-tributary and often unfree tenant for life into the modern farmer, and of the resident serfs, bondsmen and villeins who belonged to the property into agricultural day laborers, would indeed be the history of the formation of modern capital.”[23]
In Section VIII of Capital Volume 1, titled “The So-Called Primitive Accumulation of Capital,” he expanded that paragraph into a powerful and moving account of the historical process by which the dispossession of peasants created the working class, while the land they had worked for millennia became the capitalist wealth that exploited them. It is the most explicitly historical part of Capital, and by far the most readable. No one before Marx had researched the subject so thoroughly — Harry Magdoff once commented that on re-reading it, he was immediately impressed by the depth of Marx’s scholarship, by “the amount of sheer digging, hard work, and enormous energy in the accumulated facts that show up in his sentences.”[24]
Since Marx wrote Capital, historians have published a vast amount of research on the history of English agriculture and land tenure — so much that a few decades ago, it was fashionable for academic historians to claim that Marx got it all wrong, that the privatization of common land was a beneficial process for all concerned. That view has little support today. Of course it would be very surprising if subsequent research didn’t contradict Marx in some ways, but while his account requires some modification, especially in regard to regional differences and the tempo of change, Marx’s history and analysis of the commons remains essential reading.[25]
*****
The next installments in this series will discuss how, in two great waves of social change, landlords and capitalist farmers “conquered the field for capitalist agriculture, incorporated the soil into capital, and created for the urban industries the necessary supplies of free and rightless proletarians.”[26]
To be continued ….
[1] Wendell Berry, Wendell Berry: Essays 1969-1990, ed. Jack Shoemaker (Library of America, 2019), 317.
[2] https://www.unccd.int/news-events/better-land-use-and-management-critical-achieving-agenda-2030-says-new-report
[3] Karl Marx, Capital: A Critique of Political Economy, trans. David Fernbach, vol. 3, (Penguin Books, 1981), 216
[4] John Bellamy Foster, Brett Clark, and Hannah Holleman, “Marx and the Commons,” Social Research (Spring 2021), 2-3.
[5] See “Reasons for Inequality Among Medieval Peasants,” in Rodney Hilton, Class Conflict and the Crisis of Feudalism: Essays in Medieval Social History (Hambledon Press, 1985), 139-151.
[6] Rodney Hilton, Bond Men Made Free: Medieval Peasant Movements and the English Rising of 1381 (Routledge, 2003 [1973]), 32.
[7] Rodney Hilton, Bond Men Made Free, 34.
[8] Garrett Hardin, The Tragedy of the Commons, Science, December 13, 1968.
[9] Ian Angus, The Myth of the Tragedy of the Commons, Climate & Capitalism, August 25, 2008; Ian Angus, Once Again: ‘The Myth of the Tragedy of the Commons’, Climate & Capitalism, November 3, 2008.
[10] Susan Jane Buck Cox, No Tragedy of the Commons, Environmental Ethics 7, no. 1 (1985), 60.
[11] J. M. Neeson, Commoners: Common Right, Enclosure and Social Change in England, 1700-1820 (Cambridge University Press, 1993), 113.
[12] J. M. Neeson, Commoners, 117.
[13] J. M. Neeson, Commoners, 118-20.
[14] J. M. Neeson, Commoners, 132.
[15] J. M. Neeson, Commoners, 157.
[16] Karl Marx, Capital Volume 3, trans. David Fernbach, (Penguin Books, 1981), 959.
[17] For an insightful summary and critique of the major positions in those debates, see Henry Heller, The Birth of Capitalism: A Twenty-First Century Perspective (Pluto Press, 2011).
[18] Karl Marx, Grundrisse, trans. Martin Nicolaus (Penguin Books, 1973), 510.
[19] W. G. Hoskins, The Midland Peasant: The Economic and Social History of a Leicestershire Village (Macmillan., 1965), 141.
[20] Mark Overton, Agricultural Revolution in England: The Transformation of the Agrarian Economy, 1500-1850 (Cambridge University Press, 1996), 8, 21.
[21] Karl Marx, Capital Volume, 1, 874.
[22] Karl Marx, Capital Volume 1, 273.
[23] Karl Marx, Grundrisse, 252-3.
[24] Harry Magdoff, “Primitive Accumulation and Imperialism,” Monthly Review (October 2013), 14.
[25] “The So-Called Primitive Accumulation” — Chapters 26 through 33 of Capital Volume 1 — can be read on the Marxist Internet Archive, beginning here. The somewhat better translation by Ben Fowkes occupies pages 873 to 940 of the Penguin edition.
[26] Karl Marx, Capital Volume 1, 895.
by DGR News Service | Sep 14, 2021 | Alienation & Mental Health, Education, Strategy & Analysis
This article is from the blog buildingarevolutionarymovement.
This post lists and challenges, debunks, pulls apart the following myths of capitalism:
- there is no alternative to capitalism
- capitalism is the only system that provides individual and economic freedom
- everything is better under capitalism
- as capitalism increases the size of the economy, everyone benefits
- free-market capitalism is the best way to run the global economy
- capitalist economic theory is the best
- capitalism maintains low taxes, which is good for workers and businesses
- capitalism promotes equality, work hard and you’ll get rich
- capitalism fits well with human nature
- capitalism and democracy work well together
- capitalism gradually balances differences across countries through free markets and free trade.
There is a liberal capitalist myth about progress. A determinist (set path forwards) view that things will continue to get better. I completely disagree with this perspective and it is clearly wrong if you look at history, esp the last 40 years. I will describe and challenge this myth in a future post.
I would like to start with a quote from 23 Things They Dont Tell You About Capitalism by Ha-Joon Chang:
“Most countries have introduced free-market policies over the last three decades – privatization of state-owned industrial and financial firms, deregulation of finance and industry, liberalization of international trade and investment, and reduction in income taxes and welfare payments. These policies, their advocates admitted, may temporarily create some problems, such as rising inequality, but ultimately they will make everyone better off by creating a more dynamic and wealthier society. The rising tide lifts all boats together, was the metaphor.
The result of these policies has been the polar opposite of what was promised. Forget for a moment the financial meltdown, which will scar the world for decades to come. Prior to that, and unbeknown to most people, free-market policies had resulted in slower growth, rising inequality and heightened instability in most countries. In many rich countries, these problems were masked by huge credit expansion; thus the fact that US wages had remained stagnant and working hours increased since the 1970s was conveniently fogged over by the heady brew of credit-fuelled consumer boom. The problems were bad enough in the rich countries, but they were even more serious for the developing world. Living standards in Sub-Saharan Africa have stagnated for the last three decades, while Latin America has seen its per capita growth rate fall by two-thirds during the period. There were some developing countries that grew fast (although with rapidly rising inequality) during this period, such as China and India, but these are precisely the countries that, while partially liberalizing, have refused to introduce full-blown free-market policies.
Thus, what we were told by the free-marketeers – or, as they are often called, neo-liberal economists – was at best only partially true and at worst plain wrong…the ‘truths’ peddled by free-market ideologues are based on lazy assumptions and blinkered visions, if not necessarily self-serving notions.”[1]
Myth – there is no alternative to capitalism
The argument goes that there is no viable alternative economic system. Centrally controlled governments have been tried and failed. Capitalism isn’t perfect but it’s all we’ve got. [2]
Simplistically this is an argument against planned economies which I will deal with in the free market capitalism section below. The main two examples of communist planned economies are the Soviet Union and the People’s Republic of China. There are many different forms of communism and these are authoritarian examples. They only came to exist and survive in the violent 20th century because they had strong leadership and then used military force to defend themselves against capitalist nations that attempted to destroy them. There is of course more to their survival than this but that is for another post. I’m not in the slightest defending the horrific violence they directed to their citizens. Critics of these experiments do not acknowledge all the positive things that we can learn from the Soviet Union – self-management, collectivisation, new housing processes, increases in literacy. [3]
What I want to focus on here is that if capitalism is genuinely the only naturally existing economic system, then why do capitalists have to constantly crush any alternatives. Because, capitalists see these embryonic alternatives as a threat to their wealth, dominance and control. This is done either through extreme media manipulation and propaganda or with violence and killings. This post gives three examples of capitalists crushing alternatives: the Copenhagen squatting movement, New Age Travellers in the UK, and the US-backed 1973 military coup of the socialist government of Salvador Allende in Chile. Other examples are the tens of thousands killed after the defeat of the Paris Commune in 1871 [4], German Revolution 1918-19, the EU drastic threats against the Syriza Greek government in 2015, and the demonisation of Jeremy Corbyn.
Myth – capitalism is the only system that provides individual and economic freedom
The moral argument for capitalism is based on individual freedom being a natural right that pre-exists society. Capitalist society is valued and justified because it benefits humans and enhances economic freedom, instead of limiting it.
This individual and economic freedom is a limited form of freedom. In the #ACFM episode – Trip 10 How It Feels to Be Free, several forms of freedom are discussed. These include comparing the liberal, conservative, radical and authoritarian traditions and their relationship to freedom [5]. They also discussed Isaiah Berlin’s Two Concepts of Liberty – positive and negative [6]. The negative concept is freedom from constraint to do what you want. This is described as the ‘Jeremy Clarkson concept of freedom’ or the ‘anti-woke concept of freedom [7] The positive idea is a freedom to do something and for many, this means that the material conditions have to be created, which resulted in the post-war welfare state. [8]
Myth – everything is better under capitalism
The arguement goes that capitalism has resulted in improved basic standards of living, reduction in poverty and increased life expectancy. There is also the argument that Western capitalist countries have the happiest populations because they can consume whatever products and services they like.
The truth behind this myth is that capitalism results in economic growth, which has come at huge costs – see the economic growth myths below. The myth is that capitalism intentionally results in better living standards for workers and the general population. This relates to the liberal myth about liberal progress (see a future post on this). Any reform or improvement in the living standards of workers and the general population has to be fought for by people and groups (trade unions, social movements or in parliament) who want these improvements. Historically movements challenged capitalism for higher wages which resulted in longer life expectancy and a decline in infectious diseases. The capitalists certainly don’t want these reforms if it means improved rights for workers and limits their ability to increase their profits. The capitalists are of course more than happy to use these reforms as examples of how good capitalism is, when in fact they resisted them and work to undo them. Some capitalists practice a form of Victoria philanthropy but still want to exploit their workers. In recent years life expectancy in Britain and the US has started to decline due to austerity and other reasons. [9]
And to quote Ha-Joon Chang:
“The average US citizen does have greater command over goods and services than his counterpart in any other country in the world except Luxemburg. However, given the country’s high inequality, this average is less accurate in representing how people live than the averages for other countries with a more equal income distribution. Higher inequality is also behind the poorer health indicators and worse crime statistics of the US. Moreover, the same dollar buys more things in the US than in most other rich countries mainly because it has cheaper services than in other comparable countries, thanks to higher immigration and poorer employment conditions. Furthermore, Americans work considerably longer than Europeans. Per hour worked, their command over goods and services is smaller than that of several European countries. While we can debate which is a better lifestyle – more material goods with less leisure time (as in the US) or fewer material goods with more leisure time (as in Europe) – this suggests that the US does not have an unambiguously higher living standard than comparable countries.” [10]
In terms of happiness, people are not stupid. They understand that they don’t have any influence on the direction of society, that things are going to be worse for future generations but there isn’t anything they can do about it. Buying more stuff and going on more holidays is a consolation prize that stops people looking for real change. Also, the number of antidepressant prescriptions doubled between 2008 and 2018, not a sign that people are happy.
Myth – as capitalism increases the size of the economy, everyone benefits
Capitalism results in exponential economic growth, so the arguement goes that this allows companies and individuals to benefit. This relates to the idea of, ‘A rising tide lifts all boats’ and ‘trickle-down economics‘ , where if the rich get richer, then this will benefit everyone.
And to quote Ha-Joon Chang:
“The above idea, known as ‘trickle-down economics’, stumbles on its first hurdle. Despite the usual dichotomy of ‘growth-enhancing pro-rich policy’ and ‘growth-reducing pro- poor policy’, pro-rich policies have failed to accelerate growth in the last three decades. So the first step in this argument – that is, the view that giving a bigger slice of pie to the rich will make the pie bigger – does not hold. The second part of the argument – the view that greater wealth created at the top will eventually trickle down to the poor – does not work either. Trickle down does happen, but usually its impact is meagre if we leave it to the market.” [11]
Myth – free-market capitalism is the best way to run the global economy
Capitalism produces a wide range of goods and services based on what is wanted or can solve a problem. It is argued that capitalism is economically efficient because it creates incentives to provide goods and services efficiently. The competitive market forces companies to improve how they are organised and use resources efficiently. [12]
This needs to be broken down into several arguments: the instability of capitalism, free-market vs state planning, free-market economics has only been applied in non-Western countries, corporations need to be regulated, where technology innovation happens, the impact of unlimited economic growth on the environment/planet.
Instability
Since the 1970s government have focused on ensuring price stability by managing inflation. This has not resulted in the stability of the world economy as the 2008 financial crisis shows. [13] Instability and crisis are part of the capitalist economic system. It is a cycle that starts when the memory of past economic crises fade and financial institutions figure out ways to circumvent the regulations that were put in place to stop them happening again. Rising asset prices reduce the cost of borrowing, resulting in market euphoria and risks being underestimated. Lots of money is being made and everyone wants their share of the growing economic boom (Richard Wolff Financial Panics, then and now in Capitalism Hits the Fan). Capitalism also needs crises so that businesses and wealth are destroyed, which lays the foundations for the next cycle of economic growth to start. This is known as ‘creative destruction‘.
There is also the argument that financial markets need to become more efficient so they can respond to changing opportunities and grow faster. Basically that there should not be any state restrictions on financial markets.
And to quote Ha-Joon Chang in 23 Things They Don’t Tell You About Capitalism:
“The problem with financial markets today is that they are too efficient. With recent financial ‘innovations’ that have produced so many new financial instruments, the financial sector has become more efficient in generating profits for itself in the short run. However, as seen in the 2008 global crisis, these new financial assets have made the overall economy, as well as the financial system itself, much more unstable. Moreover, given the liquidity of their assets, the holders of financial assets are too quick to respond to change, which makes it difficult for real-sector companies to secure the ‘patient capital’ that they need for long-term development. The speed gap between the financial sector and the real sector needs to be reduced, which means that the financial market needs to be deliberately made less efficient.” [14]
free-market vs state planning
This myth is best dealt with by Ha-Joon Chang. He explains that there is no such thing as a free market. First, he describes the capitalist free market argument:
“Markets need to be free. When the government interferes to dictate what market participants can or cannot do, resources cannot flow to their most efficient use. If people cannot do the things that they find most profitable, they lose the incentive to invest and innovate. Thus, if the government puts a cap on house rents, landlords lose the incentive to maintain their properties or build new ones. Or, if the government restricts the kinds of financial products that can be sold, two contracting parties that may both have benefited from innovative transactions that fulfil their idiosyncratic needs cannot reap the potential gains of free contract. People must be left ‘free to choose’, as the title of free-market visionary Milton Friedman’s famous book goes.”
His response is:
“The free market doesn’t exist. Every market has some rules and boundaries that restrict freedom of choice. A market looks free only because we so unconditionally accept its underlying restrictions that we fail to see them. How ‘free’ a market is cannot be objectively defined. It is a political definition. The usual claim by free-market economists that they are trying to defend the market from politically motivated interference by the government is false. Government is always involved and those free-marketeers are as politically motivated as anyone. Overcoming the myth that there is such a thing as an objectively defined ‘free market’ is the first step towards understanding capitalism.” [15]
Robert Reich in Saving Capitalism: For The Many, Not The Few explains how the free market idea has poisoned peoples minds so that they think the negative impacts of the free market are simply unfortunate but impersonal outcomes of market forces. When in fact these outcomes benefit governing class and wealthy interests. [16]
Another challenge to the free market myth is that: “in order to secure profits, and to maintain their position of privilege against potential rivals, capitalists (both individuals and institutions) will frequently work to secure monopoly control of particular economic sectors, limiting invention and production within those sectors.” [17]
Capitalists argue against market regulation and claim that governments can’t pick winners. States construct markets, they enforce contracts, provide basic services and support the monetary system that is required for economic activity to take place. Importantly, they do this in a way that favours certain interests over others. [18]
The 2008 and 2020 economic crises have shown how capitalists advocate the free market as the only way to run the economy until a crisis comes along. At that point, they want state support and bailouts. This is known as “socialism for the rich and capitalism for the poor”, “Socialize Costs, Privatize Profits” and ‘lemon socialism‘. This is a good video of Richard Wolff on how American capitalism is just socialism for the rich.
We are told that we are not smart enough to leave things to the market. Ha-Joon Chang summarises this argument:
“We should leave markets alone, because, essentially, market participants know what they are doing – that is, they are rational. Since individuals (and firms as collections of individuals who share the same interests) have their own best interests in mind and since they know their own circumstances best, attempts by outsiders, especially the government, to restrict the freedom of their actions can only produce inferior results. It is presumptuous of any government to prevent market agents from doing things they find profitable or to force them to do things they do not want to do, when it possesses inferior information.”
His response to this myth:
“People do not necessarily know what they are doing, because our ability to comprehend even matters that concern us directly is limited – or, in the jargon, we have ‘bounded rationality’. The world is very complex and our ability to deal with it is severely limited. Therefore, we need to, and usually do, deliberately restrict our freedom of choice in order to reduce the complexity of problems we have to face. Often, government regulation works, especially in complex areas like the modern financial market, not because the government has superior knowledge but because it restricts choices and thus the complexity of the problems at hand, thereby reducing the possibility that things may go wrong.” [19]
Leigh Phillips and Michal Rozworski state that: “perhaps the strongest argument ever mounted against the left by the right is that the calculation and coordination involved in running a complex economy to satisfy disparate human needs and desires simply could not be consciously carried out. Only decentralised price signals operating through the market, miraculously aggregating an infinitude of disparate information, could guide an economy without dramatic failures, misallocations, and ultimately, authoritarian disasters.” They describe how the Second World War saw governments solve complex coordination problems. [20] In their book, People’s Republic of Walmart: How the World’s Biggest Corporations are Laying the Foundation for Socialism, they explain how most Western economies are centrally planned.
Ha-Joon Chang explains that despite the fall of communism, we are still living in planned economies. The capitalist argument goes:
“The limits of economic planning have been resoundingly demonstrated by the fall of communism. In complex modern economies, planning is neither possible nor desirable. Only decentralized decisions through the market mechanism, based on individuals and firms being always on the lookout for a profitable opportunity, are capable of sustaining a complex modern economy. We should do away with the delusion that we can plan anything in this complex and ever- changing world. The less planning there is, the better.”
Ha-Joon Chang response is:
“Capitalist economies are in large part planned. Governments in capitalist economies practise planning too, albeit on a more limited basis than under communist central planning. All of them finance a significant share of investment in R&D and infrastructure. Most of them plan a significant chunk of the economy through the planning of the activities of state-owned enterprises. Many capitalist governments plan the future shape of individual industrial sectors through sectoral industrial policy or even that of the national economy through indicative planning. More importantly, modern capitalist economies are made up of large, hierarchical corporations that plan their activities in great detail, even across national borders. Therefore, the question is not whether you plan or not. It is about planning the right things at the right levels.” [21]
Free market economics has only been applied in non-Western countries
Noam Chomsky explains that pure free-market economics (he calls it Laissez-faire principles) has only been applied to non-Western countries. Attempts by Western governments to try it have gone badly and been reversed.
Corporations need to be regulated
We are told that a strong economy needs corporations to do well. Ha-Joon Chang explains the argument:
“At the heart of the capitalist system is the corporate sector. This is where things are produced, jobs created and new technologies invented. Without a vibrant corporate sector, there is no economic dynamism. What is good for business, therefore, is good for the national economy. Especially given the increasing international competition in a globalizing world, countries that make opening and running businesses difficult or make firms do unwanted things will lose investment and jobs, eventually falling behind. Government needs to give the maximum degree of freedom to business.”
His response:
“Despite the importance of the corporate sector, allowing firms the maximum degree of freedom may not even be good for the firms themselves, let alone the national economy. In fact, not all regulations are bad for business. Sometimes, it is in the long-run interest of the business sector to restrict the freedom of individual firms so that they do not destroy the common pool of resources that all of them need, such as natural resources or the labour force. Regulations can also help businesses by making them do things that may be costly to them individually in the short run but raise their collective productivity in the long run – such as the provision of worker training. In the end, what matters is not the quantity but the quality of business regulation.” [22]
There is also the myth about the need to maximise shareholder value over the performance of the company. This results in managers focusing on increasing the share value instead of business performance. They are of course related but this approach results in managers making decisions that have negative effects on the company performance. [23]
Innovation
The capitalist argument is made by conservative MP Chris (failing) Grayling:
“If you believe in capitalism and free enterprise, then you believe that by allowing people to pursue success for themselves you create a culture of innovation and competition which benefits the whole of society. Free enterprise, business innovating in products and services, benefits the whole of our society.”
Although technological dynamism has been a strong argument for capitalism, investing in research and development it is too risky and takes too long for most capitalists to fund. The majority is publicly funded. [24]
Jeremy Gilbert argues that the creativity that leads to artistic, scientific or utilitarian inventions is not created by capitalism but instead from human interaction on the edges of capital. Then capital feeds on this creativity and transforms it into products to sell. This is why capital must locate itself near great centres of collective exchange and creativity such as London and Paris in the 19th century, New York and California in the 20th century. [25]
the impact of unlimited economic growth on the environment
It’s not possible to have infinite economic growth on a finite planet. [26] Capitalism requires that the economy grows each year. This requires that this year more things need to be made, more energy needs to be used and more people need to be born than last year. Then next year, more of all this is needed than this year.
Myth – capitalist economic theory is the best
Richard Wolff and Stephen Resnick summarise neoclassical theory’s contribution as:
“The originality of neoclassical theory lies in its notion that innate human nature determines economic outcomes. According to this notion, human beings naturally possess the inherent rational and productive abilities to produce the maximum wealth possible in a society. What they need and have historically sought is a kind of optimal social organization—a set of particular social institutions—that will free and enable this inner human essence to realize its potential, namely the greatest possible well-being of the greatest number. Neoclassical economic theory defines each individual’s well-being in terms of his or her consumption of goods and services: maximum consumption equals maximum well-being.
Capitalism is thought to be that optimum society. Its defining institutions (individual freedom, private property, a market system of exchange, etc.) are believed to yield an economy that achieves the maximum, technically feasible output and level of consumption. Capitalist society is also harmonious: its members’ different desires—for maximum enterprise profits and for maximum individual consumption—are brought into equilibrium or balance with one another.” [27]
Economics as a subject is based only on the theories of those who support it. University courses in economics are only taught by those that support capitalism. They do not teach the significant problems with capitalism or the viable alternatives. [28]
Ha-Joon Chang in 23 Things They Don’t Tell You About Capitalism explains that good economic policy does not require good economists. That the most successful economic bureaucrats are not normally economists, giving examples of Japan, Korea, China and Taiwan. [29]
The author of Capitalism 4.0: The Birth of a New Economy, Anatole Kaletsky recommends Beyond Mechanical Markets: Asset Price Swings, Risk, and the Role of the State by Roman Frydman and Michael D. Goldberg, which unpacks the economic assumptions mainstream economics is based on. Markets are not predictably rational or irrational. They argue instead that price swings are driven by individuals’ ever-imperfect interpretations of the significance of economic fundamentals for future prices and risk. [30]
Myth – capitalism maintains low taxes, which is good for workers and businesses
The arguement goes that low business taxes encourage companies to stay in a country and provide more jobs by reinvesting the money they would pay in tax into the company. Some also argue that low business tax generates more tax for the government. [31]
Some capitalists would prefer to pay no taxes at all. But the capitalists need the things that taxes pay for: police, schools, healthcare, transport systems. These public goods support capitalist society so there are workers to employ (exploit). [32] They also need the welfare state and public services to ensure capitalism’s survival and people do not become so desperate that they rise up and revolt.
The argument goes that low business tax (corporation tax) result in more business starting up so more jobs. Also, the advocates of low corporation tax state that low tax means businesses will reinvest to make it more competitive, [33] instead of giving shareholders a dividend. For this reinvestment argument to add up then the UK would not have the lowest worker productivity rates in the last 250 years or compared to other countries in Europe. The first article puts the drop in productivity down to: the lasting effect of the 2008 crisis for the financial system; weaker gains from computer technologies in recent years after a boom in the late 1990s and early 2000s; and intense uncertainty over post-Brexit trading relationships sapping business investment. The second article explains the decline is due to: less investment in equipment and infrastructure within the business; less spent on research and development; poor national infrastructure (roads and rail networks); and a lack of trade skills, basic literacy and numeracy skills, and lack of managerial competence.
These companies should be reinvesting in there business with more equipment, infrastructure and training. Add to this that the other issues listed in these articles can be resolved by the government but they choose not to because capitalists do not want highly skilled and well-paid workers, only working four days a week because that would give people time to start thinking and organising for how to make society better. [34] This article argues that reducing the corporate tax rate does not increase worker wages or business reinvestment.
There is also the myth/argument that if you increase taxes then the rich and businesses will relocate abroad. This article shows that the rich do not leave if you increase taxes. Also if businesses are going to relocate this will be to reduce the worker wages costs or where environmental regulations are less strict.
This telegraph article [35] from 2015 explains that corporation tax received by the government was up by 12% compared to 2014, even though the corporation tax percentage had dropped. The article does explain that company profits were up, partly because there was little wage growth. Corporation tax is based on the amount of profits a company takes. So while workers are struggling on low wages, UK company shareholders are taking more profits. It also explains that the UK has a lot more start-up companies that in the past. This is just what capitalists want, loads of small business owners who are more conservative, risk-averse and want the status quo to be maintained. This article does drone on about how unfair it is to say that companies don’t pay their fair share. Most people know that most companies pay their taxes. That complaint is directed at Amazon, Apple and the other tax-dodging big players. This article makes the case that cutting corporation tax costs the government billions.
Ha-Joon Chang challenges the capitalist myth that big government is bad for the economy. He explains that “A well-designed welfare state can actually encourage people to take chances with their jobs and be more, not less, open to changes.” [36]
Myth – capitalism promotes equality, work hard and you’ll get rich
This is the ‘American Dream’ idea that you may start poor but if you work hard, you can be successful and rich. This is also known as meritocracy. [37]
The equality that this refers to is the equality of opportunity. Ha-Joon Chang describes the capitalist argument:
“Many people get upset by inequality. However, there is equality and there is equality. When you reward people the same way regardless of their efforts and achievements, the more talented and the harder-working lose the incentive to perform. This is equality of outcome. It’s a bad idea, as proven by the fall of communism. The equality we seek should be the equality of opportunity. For example, it was not only unjust but also inefficient for a black student in apartheid South Africa not to be able to go to better, ‘white’, universities, even if he was a better student. People should be given equal opportunities. However, it is equally unjust and inefficient to introduce affirmative action and begin to admit students of lower quality simply because they are black or from a deprived background. In trying to equalize outcomes, we not only misallocate talents but also penalize those who have the best talent and make the greatest efforts.”
His response:
“Equality of opportunity is the starting point for a fair society.
But it’s not enough. Of course, individuals should be rewarded for better performance, but the question is whether they are actually competing under the same conditions as their competitors. If a child does not perform well in school because he is hungry and cannot concentrate in class, it cannot be said that the child does not do well because he is inherently less capable. Fair competition can be achieved only when the child is given enough food – at home through family income support and at school through a free school meals programme. Unless there is some equality of outcome (i.e., the incomes of all the parents are above a certain minimum threshold, allowing their children not to go hungry), equal opportunities (i.e., free schooling) are not truly meaningful.” [38]
Economic equality is really what we need to be concerned about. Danny Dorling describes how “The gap between the very rich and the rest is wider in Britain than in any other large country in Europe, and society is the most unequal it has been since shortly after the First World War.” [39]
The benefits for this myth for the capitalists is that it gives workers some hope that things can be better if they work that bit harder to chase the material benefits. It rewards some to keep the dream alive. It is also a cover for the business owners, managers and shareholders to justify their wealthy position. They can say they earned their money through hard work. Of course many inherited their wealth. [40]
There is also the capitalist myth that low worker wages mean lower prices for consumers. This has some truth in it but it is mainly a justification for low worker wages and high business managers wages. By this logic, higher manager wages result in higher consumer prices but there is generally lower investment in production costs (equipment and infrastructure). This results in low worker wages and fewer jobs [41]
Ha-Joon Chang in 23 Things They Don’t Tell You About Capitalism describes how US managers are over-priced:
“US managers are over-priced in more than one sense. First, they are over-priced compared to their predecessors. In relative terms (that is, as a proportion of average worker compensation), American CEOs today are paid around ten times more than their predecessors of the 1960s, despite the fact that the latter ran companies that were much more successful, in relative terms, than today’s American companies. US managers are also over-priced compared to their counterparts in other rich countries. In absolute terms, they are paid, depending on the measure we use and the country we compare with, up to twenty times more than their competitors running similarly large and successful companies. American managers are not only over-priced but also overly protected in the sense that they do not get punished for poor performance. And all this is not, unlike what many people argue, purely dictated by market forces. The managerial class in the US has gained such economic, political and ideological power that it has been able to manipulate the forces that determine its pay.” [42]
Myth – capitalism fits well with human nature
The arguments goes that humans are naturally selfish, greedy and competitive. People that work hard are successful and outcompete their competitors, and are therefore rewarded financially. Capitalism also allows for other aspects of human nature such as altruism, patience and kindness. This is done through the creation of welfare systems and charities. [43]
Robert Jensen’s response to this is:
“There is a theory behind contemporary capitalism. We’re told that because we are greedy, self-interested animals, an economic system must reward greedy, self-interested behavior if we are to thrive economically. Are we greedy and self-interested? Of course. At least I am, sometimes. But we also just as obviously are capable of compassion and selflessness. We certainly can act competitively and aggressively, but we also have the capacity for solidarity and cooperation. In short, human nature is wide-ranging. Our actions are certainly rooted in our nature, but all we really know about that nature is that it is widely variable. In situations where compassion and solidarity are the norm, we tend to act that way. In situations where competitiveness and aggression are rewarded, most people tend toward such behavior. Why is it that we must choose an economic system that undermines the most decent aspects of our nature and strengthens the most inhuman? Because, we’re told, that’s just the way people are. What evidence is there of that? Look around, we’re told, at how people behave. Everywhere we look, we see greed and the pursuit of self-interest. So, the proof that these greedy, self-interested aspects of our nature are dominant is that, when forced into a system that rewards greed and self-interested behavior, people often act that way. Doesn’t that seem just a bit circular?”
And Ha-Joon Chang response to capitalism’s human nature arguement is:
“Self-interest is a most powerful trait in most human beings. However, it’s not our only drive. It is very often not even our primary motivation. Indeed, if the world were full of the self- seeking individuals found in economics textbooks, it would grind to a halt because we would be spending most of our time cheating, trying to catch the cheaters, and punishing the caught. The world works as it does only because people are not the totally self-seeking agents that free-market economics believes them to be. We need to design an economic system that, while acknowledging that people are often selfish, exploits other human motives to the full and gets the best out of people. The likelihood is that, if we assume the worst about people, we will get the worst out of them.” [44]
Myth – capitalism and democracy work well together
The argument goes that capitalism is built on democracy. Everyone gets one vote so they have equal political power, which is not affected by their race, gender or views. Capitalism also encourages people to get involved in all aspects of society to get what they want. This includes getting involved with both governance and the government, from voting in elections to standing in local or national elections. [45]
Robert Jensen explains how capitalism is anti-democratic:
“This one is easy. Capitalism is a wealth-concentrating system. If you concentrate wealth in a society, you concentrate power. Is there any historical example to the contrary? For all the trappings of formal democracy in the contemporary United States, everyone understands that the wealthy dictates the basic outlines of the public policies that are acceptable to the vast majority of elected officials. People can and do resist, and an occasional politician joins the fight, but such resistance takes extraordinary effort. Those who resist win victories, some of them inspiring, but to date concentrated wealth continues to dominate. Is this any way to run a democracy? If we understand democracy as a system that gives ordinary people a meaningful way to participate in the formation of public policy, rather than just a role in ratifying decisions made by the powerful, then it’s clear that capitalism and democracy are mutually exclusive. Let’s make this concrete. In our system, we believe that regular elections with the one-person/one-vote rule, along with protections for freedom of speech and association, guarantee political equality. When I go to the polls, I have one vote. When Bill Gates goes the polls, he has one vote. Bill and I both can speak freely and associate with others for political purposes. Therefore, as equal citizens in our fine democracy, Bill and I have equal opportunities for political power. Right?”
Not everyone does get to vote, some such as criminals no longer have that right. Many don’t bother to vote as the options between several capitalist political parties feel very limited. Government can’t go against global capitalism as the Greek Syriza government found out when it tried to reject austerity in 2015. There is also the problems and unfairness of the First Past the Post voting system, which benefits rightwing, extreme pro-capitalist parties. Also, these parties do better in elections when voter turnout is lower. [46]
Richard Wolff makes the point that we spend half of our time in undemocratic companies. A small group of people (boards of directors and shareholders) make decisions in businesses that affect the workers such as if the business shuts down and moves overseas, who loses their job and who gets the profits. But the workers do not have any say in these decisions. Outside the workplace, people get to vote in our local communities and national government. [47]
Ha-Joon Chang explains that companies should not be run in the interest of their owners:
“Shareholders may be the owners of corporations but, as the most mobile of the ‘stakeholders’, they often care the least about the long-term future of the company (unless they are so big that they cannot really sell their shares without seriously disrupting the business). Consequently, shareholders, especially but not exclusively the smaller ones, prefer corporate strategies that maximize short-term profits, usually at the cost of long-term investments, and maximize the dividends from those profits, which even further weakens the long-term prospects of the company by reducing the amount of retained profit that can be used for re-investment. Running the company for the shareholders often reduces its long-term growth potential.” [48]
Myth – Capitalism gradually balances differences across countries through free markets and free trade.
The arguement goes that countries can use their competitive advantage to benefit themselves and also access goods and services from the rest of the world. [49]
Ha-Joon Chang describes how free-market policies rarely make poor countries rich. The capitalist argument is:
“After their independence from colonial rule, developing countries tried to develop their economies through state intervention, sometimes even explicitly adopting socialism. They tried to develop industries such as steel and automobiles, which were beyond their capabilities, artificially by using measures such as trade protectionism, a ban on foreign direct investment, industrial subsidies, and even state ownership of banks and industrial enterprises. At an emotional level this was understandable, given that their former colonial masters were all capitalist countries pursuing free-market policies. However, this strategy produced at best stagnation and at worst disaster. Growth was anaemic (if not negative) and the protected industries failed to ‘grow up’. Thankfully, most of these countries have come to their senses since the 1980s and come to adopt free-market policies. When you think about it, this was the right thing to do from the beginning. All of today’s rich countries, with the exception of Japan (and possibly Korea, although there is debate on that), have become rich through free-market policies, especially through free trade with the rest of the world. And developing countries that have more fully embraced such policies have done better in the recent period.
His response:
“Contrary to what is commonly believed, the performance of developing countries in the period of state-led development was superior to what they have achieved during the subsequent period of market-oriented reform. There were some spectacular failures of state intervention, but most of these countries grew much faster, with more equitable income distribution and far fewer financial crises, during the ‘bad old days’ than they have done in the period of market- oriented reforms. Moreover, it is also not true that almost all rich countries have become rich through free-market policies. The truth is more or less the opposite. With only a few exceptions, all of today’s rich countries, including Britain and the US – the supposed homes of free trade and free market – have become rich through the combinations of protectionism, subsidies and other policies that today they advise the developing countries not to adopt. Free-market policies have made few countries rich so far and will make few rich in the future.” [50]
Endnotes
- 23 Things They Don’t Tell You About Capitalism, Ha-Joon Chang, 2011, introduction
- https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
- Jody Dean 11m https://www.youtube.com/watch?v=ZhUvNkJve-w
- https://en.wikipedia.org/wiki/Paris_Commune#Casualties; Massacre: The Life and Death of the Paris Commune of 1871, John M. Merriman, 2016; https://libcom.org/history/1871-the-paris-commune)
- #ACFM episode – Trip 10 How It Feels to Be Free, from 11m https://novaramedia.com/2020/05/10/trip-10-how-it-feels-to-be-free/
- #ACFM episode – Trip 10 How It Feels to Be Free, from 13m https://novaramedia.com/2020/05/10/trip-10-how-it-feels-to-be-free/
- #ACFM episode – Trip 10 How It Feels to Be Free, from 36 mins https://novaramedia.com/2020/05/10/trip-10-how-it-feels-to-be-free/
- #ACFM episode – Trip 10 How It Feels to Be Free, from 14m https://novaramedia.com/2020/05/10/trip-10-how-it-feels-to-be-free/
- https://www.theguardian.com/society/2019/jun/23/why-is-life-expectancy-falling, https://www.nakedcapitalism.com/2011/11/peak-life-expectancy.html, https://www.workers.org/2018/12/40054/
- 23 Things They Don’t Tell You About Capitalism, Ha-Joon Chang, 2011, thing 10)
- 23 Things They Don’t Tell You About Capitalism, thing 13
- https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
- 23 Things They Don’t Tell You About Capitalism, thing 6
- 23 Things They Don’t Tell You About Capitalism, thing 22
- 23 Things They Don’t Tell You About Capitalism, thing 1
- https://www.alternet.org/2015/09/robert-reich-capitalism-can-be-reformed-americas-wealthy-class-will-fight-it/
- Anticapitalism and Culture: Radical Theory and Popular Politics, Jeremy Gilbert, 2008, page 108, also see Capitalism 4.0: The Birth of a New Economy, Anatole Kaletsky, 2011, <ahref=”https://www.alternet.org/2015/09/robert-reich-capitalism-can-be-reformed-americas-wealthy-class-will-fight-it/” target=”_blank” rel=”noopener”>https://www.alternet.org/2015/09/robert-reich-capitalism-can-be-reformed-americas-wealthy-class-will-fight-it/
- Tribune Magazine, Spring 2020 The Era of State-Monopoly Capitalism, Grace Blakely page 29, https://tribunemag.co.uk/2020/06/the-era-of-state-monopoly-capitalism
- 23 Things They Don’t Tell You About Capitalism, thing 16
- Tribune Magazine, Spring 2020, Planning the Future page 69, https://tribunemag.co.uk/2020/07/planning-the-future
- 23 Things They Don’t Tell You About Capitalism, thing 19
- 23 Things They Don’t Tell You About Capitalism, thing 18
- https://www.theguardian.com/sustainable-business/blog/maximising-shareholder-value-irony
- https://www.jacobinmag.com/2015/03/socialism-innovation-capitalism-smith/
- Anticapitalism and Culture, page 109
- https://www.youtube.com/watch?v=LXxVj9MHaCw, Overshoot: The Ecological Basis of Revolutionary Change, William R. Catton Jr, 1982, https://www.counterpunch.org/2007/04/30/anti-capitalism-in-five-minutes/
- Contending Economic Theories: Neoclassical, Keynesian, Marxian, Richard Wolff and Stephen Resnick, 2012, page 52
- Richard Wolff 44m https://www.youtube.com/watch?v=UMbw0d-ebo0&t=289s)
- 23 Things They Don’t Tell You About Capitalism, thing 23
- https://fivebooks.com/best-books/new-capitalism-anatole-kaletsky/ and https://www.amazon.co.uk/gp/product/B004P1JEZW/ref=dbs_a_def_rwt_bibl_vppi_i0
- https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
- Richard D. Wolff Lecture on Worker Coops: Theory and Practice of 21st Century Socialism https://www.youtube.com/watch?v=a1WUKahMm1s 46m
- https://blogs.lse.ac.uk/politicsandpolicy/corporation-tax-cut/
- see Capitalist class project section from https://buildingarevolutionarymovement.org/2020/04/29/what-is-neoliberalism/
- https://www.telegraph.co.uk/finance/economics/11498135/Why-lower-corporation-tax-means-more-for-Treasury.html – download word doc of article Why lower corporation tax means more for Treasury
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23 Things They Don’t Tell You About Capitalism, thing 21
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https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
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23 Things They Don’t Tell You About Capitalism, thing 20
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https://www.newstatesman.com/politics/uk/2018/07/peak-inequality
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(Capitalism say ‘we earned it’ Richard Wolff Marxism 101 27m and justification why employer paid so much RW Understanding Marxism 117m
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Capitalism Hits the Fan, Richard Wolff, 2010, Real Costs of Exec Money Grabs
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23 Things They Don’t Tell You About Capitalism, thing 14
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https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
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23 Things They Don’t Tell You About Capitalism, thing 5
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https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
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https://behindthenumbers.ca/2011/04/14/who-benefits-from-low-voter-turnout/
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Richard Wolff 21m https://www.youtube.com/watch?v=ynbgMKclWWc
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23 Things They Don’t Tell You About Capitalism, thing 2
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https://buildingarevolutionarymovement.org/2020/07/31/why-do-people-support-capitalism/
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23 Things They Don’t Tell You About Capitalism, thing 7
by DGR News Service | Sep 7, 2021 | Building Alternatives, Education, Strategy & Analysis
This article is from the blog buildingarevolutionarymovement.
In this post I’ll explain why people say they support capitalism and then the actual reasons why people support capitalism. To end capitalism we need to understand why people support it. I’m listing the positives in the post that I don’t agree with. In future posts I’ll describe the myths of capitalism and the reasons why we need an alternative.
It’s easy and common to conflate capitalism, liberalism, neoliberalism and free market economics. Many use them interchangeably and I’m going to go with that for this post.
Why people say they support capitalism
There isn’t a viable alternative economic system. Capitalism’s supporters agree that capitalism isn’t perfect but it’s all we’ve got. [1]
The moral argument for capitalism is based on individual freedom being a natural right that pre-exists society. Society is valued and justified because it benefits humans and enhances economic freedom, instead of limiting it.
The practical argument for capitalism is that many forms of centrally controlled governments have been tried and failed. Therefore privately owned and controlled means of production is the only viable way to run economies. [2]
Everything is better under capitalism. Capitalism has resulted in improved basic standards of living, reduction in poverty and increased life expectancy. There is also the argument that Western capitalist countries have the happiest populations because they can consume whatever products and services they like. [3]
Economics arguments. Capitalism results in exponential growth, which allows companies and individuals to benefit. This relates to the idea of, ‘A rising tide lifts all boats’, where if the rich get richer, then this will benefit everyone. Capitalism produces a wide range of goods and services based on what is wanted or can solve a problem. It is argued that capitalism is economically efficient because it creates incentives to provide goods and services in an efficient way. The competitive market forces companies to improve how they are organised and use resources efficiently. [4]
In 23 Things They Don’t Tell You About Capitalism, Ha-Joon Chang describes the free market ideology:
“We have been told that, if left alone, markets will produce the most efficient and just outcome. Efficient, because individuals know best how to utilize the resources they command, and just, because the competitive market process ensures that individuals are rewarded according to their productivity. We have been told that business should be given maximum freedom. Firms, being closest to the market, know what is best for their businesses. If we let them do what they want, wealth creation will be maximized, benefiting the rest of society as well. We were told that government intervention in the markets would only reduce their efficiency. Government intervention is often designed to limit the very scope of wealth creation for misguided egalitarian reasons. Even when it is not, governments cannot improve on market outcomes, as they have neither the necessary information nor the incentives to make good business decisions. In sum, we were told to put all our trust in the market and get out of its way.
Following this advice, most countries have introduced free-market policies over the last three decades – privatization of state-owned industrial and financial firms, deregulation of finance and industry, liberalization of international trade and investment, and reduction in income taxes and welfare payments. These policies, their advocates admitted, may temporarily create some problems, such as rising inequality, but ultimately they will make everyone better off by creating a more dynamic and wealthier society. The rising tide lifts all boats together, was the metaphor.” [5]
Capitalism has brought significant technology innovations. These included smartphones; the internet with rapid home delivery; streaming movies; social media; and automation has dramatically increased labour productivity. [6] Business invests in research and development to create better products and remain competitive. Employees work to improve their best practice to increase their productivity. [7] Supporters of capitalism argue that capitalism is very flexible and adaptable at dealing with society’s problems as they develop. An example would be climate change, with technologies such as renewables, carbon capture, nuclear power and geoengineering.
Capitalism is a social good and provides services to others. Selfishly working to make money means producing goods and services that others need. Even overpaid professions such as playing sport, or unpopular professions such as banking. This means that people can earn money and solve a problem for someone else. [8]
Capitalism promotes equality. This is the ‘American Dream’ idea that you may start out poor but if you work hard, you can be successful and rich. This is also known as meritocracy. [9]
Capitalism fits well with human nature. Humans are naturally selfish, greedy and competitive. People that work hard are successful and outcompete their competitors, and are therefore rewarded financially. Capitalism also allows for other aspects of human nature such as altruism, patience and kindness. This is done through the creation of welfare systems and charities. [10]
Capitalism and democracy work well together. Capitalism is built on democracy. Everyone gets one vote so they have equal political power, which is not affected by their race, gender or views. [11] Capitalism also encourages people to get involved in all aspects of society to get what they want. This includes getting involved with both governance and the government, from voting in elections, to standing in local or national elections. [12]
Capitalism gradually balances differences across countries through free markets and free trade. Countries can use their competitive advantage to benefit themselves and also access goods and services from the rest of the world. [13]
Capitalism maintains low taxes, which is good for workers and businesses. Low business taxes encourages companies to stay and provide more jobs by reinvesting the money they would pay in tax into the company. Some also argue that low business tax generates more tax for the government. [14]
Allan H. Meltzer, who wrote ‘Why Capitalism’, argues that capitalism has three strengths: economic growth, individual freedom, and it is adaptable to the many diverse cultures in the world. [15] He makes the case for capitalism in more detail:
“Capitalist systems are not rigid, nor are they all the same. Capitalism is unique in permitting change and adaptation, and so different societies tend to develop different forms of it. What all share is ownership of the means of production by individuals who remain relatively free to choose their activities, where they work, what they buy and sell, and at what prices. As an institution for producing goods and services, capitalism’s success rests on a foundation of a rule of law, which protects individual rights to property, and, in the first instance, aligns rewards to values produced. Working hand in hand with the rule of law, capitalism gives its participants incentives to act as society desires, typically rewarding hard work, intelligence, persistence and innovation. If too many laws work against this, capitalism may suffer disruptions. Capitalism embraces competition. Competition rewards those who build value, and buyers with choices and competitive prices. Like any system, capitalism has successes and failures—but it is the only system known to humanity that increases both growth and freedom. Instead of ending, as some critics suppose, capitalism continues to spread—and has spread to cultures as different as Brazil, Chile, China, Japan, and Korea. It is the only system humans have found in which personal freedom, progress and opportunities coexist. Most of the faults and flaws on which critics dwell are human faults. Capitalism is the only system that adapts to all manner of cultural and institutional differences. It continues to spread and adapt, and will for the foreseeable future.” [16]
Reasons why people actually support capitalism
So why do ordinary people continue to support capitalism or not actively seek an alternative economic system? This is a huge, complex question so I don’t plan to answer this in detail now. I do want to outline some broad reasons.
There is no alternative (tina). When Margaret Thatcher used this phrase, she meant that capitalism was the only viable economic and political system. In the 21st century it has become near impossible for most to imagine a coherent alternative to capitalism, this is known as ‘Capitalist Realism’. [17] The dominant narrative is that any attempts to organise societies in a non-capitalist way have been complete failures, and this has been accepted by many. Movements, leaders and parties which have attempted to reform capitalism by creating measures to bring about a fairer, more equal and less harsh society, have been attacked, distorted, misrepresented and finally crushed, examples being Corbynism in the UK, Bernie Sanders in the USA, and Syriza in Greece. This results in ‘disaffected consent,’ which I wrote about in this post. [18]
Need a job to pay bills. People are understandingly cautious about supporting an alternative to capitalism that might disrupt their lives and make things more difficult or worse. However unpopular and unstable capitalism is, it does allow a large number of people to live.
Want a fairer capitalism. Many that are struggling just want capitalism reformed to make their lives a bit better, rather than grand plans to change everything. These are seen as achievable, reasonable, small changes. Many are too busy trying to survive and provide for their families to engage with politics themselves – meetings, groups, campaigns are all too time consuming. They want this done for them by political parties.
Have not experienced collective struggle and don’t understand things could better under a different economic system. The left is historically weak, so many that want things to be better have no experience, knowledge, access and interest in left organisations and institutions, eg the trade unions. Many are anti-left and identify with the Tories.
Way out of poverty. For many born poor, capitalist society offers some that work hard and are lucky the chance to get rich, or if not rich then to have a comfortable lifestyle.
Personally benefit from capitalism. For those that enjoy the benefits of capitalism, this is a powerful motivator to keep things as they are. They have worked hard for their money and private property, and are looking forward to retirement with a pension plan. The Tories are the political party of capitalism. Many may not really like the Tories but they are perceived to be good at running the economy and maintaining the status quo. For many this is the deciding factor.
Bought off by consumption. The decline in real wages since the 1970s, and the lack of opportunities to make meaningful democratic inputs into political decision making, has been compensated by the expansion of consumption – homes, cars, electrical equipment, furniture, holidays etc. This has been made possible by the explosion of household debt and cheap goods from Asia. [19]
Economics as a subject is based only on the the theories of those who support it. University courses in economics are only taught by those that support capitalism. They do not teach the significant problems with capitalism or the viable alternatives. [20]
Endnotes
- https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/
- https://www.quora.com/What-are-the-strongest-arguments-in-defense-of-capitalism?share=1
- https://www.dailywire.com/news/5-statistics-showing-how-capitalism-solves-poverty-aaron-bandler, https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/, https://en.wikipedia.org/wiki/Enlightenment_Now
- https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/, https://vittana.org/17-pros-and-cons-of-capitalism, https://netivist.org/debate/pros-and-cons-of-capitalism
- 23 Things They Don’t Tell You About Capitalism, Ha-Joon Chang, 2010, Introduction
- https://www.jacobinmag.com/2015/12/erik-olin-wright-real-utopias-anticapitalism-democracy/
- https://vittana.org/17-pros-and-cons-of-capitalism
- https://vittana.org/17-pros-and-cons-of-capitalism and https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/
- https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/ and https://vittana.org/17-pros-and-cons-of-capitalism
- https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/
- https://listverse.com/2010/12/24/top-10-greatest-benefits-of-capitalism/
- https://vittana.org/17-pros-and-cons-of-capitalism
- https://netivist.org/debate/pros-and-cons-of-capitalism
- https://www.conservativehome.com/thecolumnists/2018/04/chris-grayling-the-argument-for-capitalism-over-socialism-cannot-be-won-with-a-history-lesson.html and https://www.telegraph.co.uk/finance/economics/11498135/Why-lower-corporation-tax-means-more-for-Treasury.html – download word doc of article Why lower corporation tax means more for Treasury
- Why Capitalism, Allan Meltzer, 2012, page ix
- https://www.writersreps.com/Why-Capitalism
- Capitalist Realism, Mark Fisher, 2009, page 2
- https://buildingarevolutionarymovement.org/2020/04/29/what-is-neoliberalism/
- Neoliberal Culutre, Jeremy Gilbert, 2016, page 25
- Richard D. Wolff Lecture on Worker Coops: Theory and Practice of 21st Century Socialism, 3 mins, https://www.youtube.com/watch?v=a1WUKahMm1s
by DGR News Service | Aug 24, 2021 | Strategy & Analysis
This article is from the blog buildingarevolutionarymovement.
The post describes the many Marxism’s after Marx. It’s long so the introduction lists the contents of the post. There is a mixture of theory and history.
Marxism after Marx historically and geographically – David McLellan
In Marxism after Marx, David McLellan has written the most comprehensive description of the various Marxism that came after Marx. This includes:
1. The German Social Democrats
- Friedrich Engels
- revisionist controversy
- The radicals
- Austro-Marxism
2. Russian Marxism
- Origins of Russian Marxism
- Leon Trotsky
- Vladimir Lenin
- Russian Marxism in the 1920s
- Stalinism
- Post-Stalin Communism
3. European Marxism between the wars
- Georg Lukács
- Karl Korsch
- Council Communism
- Antonio Gramsci
4. China and Third World
- The Making of the Chinese Revolution
- Maoism in Power
- Latin America
- Marxism and Underdevelopment
5. Contemporary Marxism in Europe and the US
- The Frankfurt School
- Existential Marxism
- Italian Marxism
- Structural Marxism
- British Marxism
- US Marxism
- Postmodern Marxism
Libertarian Marxism tenancies
- Rosa Luxemberg
- Council Communists
- G.I.K. Group of International Communists
- Socialism or Barbarism
- Letterist and Situationist International
- Early Hegalian Marxism
- Frankfurt School
- Johnson Forest Tendency
- Raya Dunayevskaya
- CLR James
- Amadeo Bordiga
- Operaismo or Workerism
- Autonomia
- Autonomist Marxism
- post-’68ers German Marxists
- Open Marxism
Neo-Marxism
Others Marxisms
- Political Marxism
- Praxis Marxism
- Two Marxisms – Scientific Marxism and Critical Marxism
Marxism after Marx historically and geographically – David McLellan
I have used the framework from David McLellan’s book Marxism After Marx for this section.
1. The German Social Democrats
Friedrich Engels worked and supported Marx, they co-authored The Communist Manifesto. After Marx’s death, Engels edited and published the second and third volumes of Capital. Engels published the Conditions of the Working Class in England in 1845 and the Origin of the Family, Private Property and the State in 1884. Following Marx’s death, Engels continued working on several areas include applying knowledge from science to how he viewed the world, historical materialism, and the state. [1]
The revisionist controversy resulted from a crisis of Marxism in the 1890s, which was caused by a recovery of capitalism. Its main proponent was Eduard Bernstein who challenged the Marxist materialist theory of history as too determinist. He also challenged Marx’s theory of value, class conflict, and polarisation (working-class impoverishment vs wealth concentration). The revisionists argued that there could be a gradual transformation into socialism. [2]
The radicals were a pressure group within the SPD (Social Democratic Party of Germany) from the early 1900s. They were mostly outsiders between the SPD and more radical movements. The two insiders were Franz Mehring and Karl Liebknecht. Mehring was a journalist who used historical materialism to analyse society and the SPD. Lieknecht was an anti-war SPD deputy (a member of parliament). The outsiders include Alexander Parvus/Israel Helphand, Antonie Pannekoek, Karl Radek and Rosa Luxemburg Luxemburg wrote a strong critique of Bernstein’s focus on social reforms and disregarding revolution and capitalist breakdown. She also critiques Bernstein in the fields of economics, sociology, and politics. Luxemburg advocated spontaneity and the mass strike over the ‘vanguard party’. Arguably her great work was The Accumulation of Capital where “she argued that capitalism needs to constantly expand into non-capitalist areas in order to access new supply sources, markets for surplus value and reservoirs of labor.” [3]
From 1906 the conservative trade unions and SPD executive made life difficult from the radicals. They became a stronger political force in the SPD during the war with their focus on the mass strike and imperialism. Opposition to the war resulted in a split in the SPD, with the left radicals (now called the Spartacists) and the oppositional centralists were expelled. The Independent German Socialist Party (USDP) was formed and included a broad range on the left from the left radicals to Bernstein. The Spartacus League published on opposition to the war, the cause of the war was imperialist rivalry between capitalist classes in different countries and the need for mass strikes. The Spartacus League had minimal impact on the USDP and formed the Communist Party of Germany in 1919 made up of small and isolated groups. Large street demonstrations in January 1919 – not organised or supported by the League – gave the government an excuse to crush the weak left radicals. [4]
Austro-Marxism was a “Marxist theoretical current, led by Victor Adler, Otto Bauer, Karl Renner, and Max Adler, members of the Social Democratic Workers’ Party of Austria in Austria-Hungary and the First Austrian Republic (1918–1934). It is known for its theory of nationality and nationalism, and its attempt to conciliate it with socialism in the imperial context.” [5]
2. Russian Marxism
The Origins of Russian Marxism were in a country that only emancipated serfs in 1861 and was an underdeveloped capitalist agrarian society. The most radical revolutionary movement was called the Populists and had a powerful connection to the Russian people. It had two schools of thought: those that believed in the self-emancipation of the people by peaceful propaganda, and those the believed in attacking the autocracy through terrorist acts. Marx’s ideas arrived in the 1880s and most agreed with the sociological analysis and critique of society but not the materialist outlook or belief in proletarian revolution. The first group of Russian Marxists, Group for the Emancipation of Labour, formed in 1883. The Russian Social Democratic Labour Party was formed in 1898. [6]
Leon Trotsky was a “Soviet revolutionary, Marxist theorist and politician whose particular strain of Marxist thought is known as Trotskyism. Trotsky took part in the 1917 October Revolution, immediately becoming a leader within the Communist Party. He was one of the seven members of the first Politburo. He was a prominent figure in the early People’s Commissar for Foreign Affairs and later as the founder and commander of the Red Army. After the rise of Joseph Stalin, Trotsky was removed from his positions and eventually expelled from the Soviet Union in February 1929. He spent the rest of his life in exile and was assassinated in 1940 in Mexico City by Ramón Mercader, a Soviet agent. Trotsky’s ideas developed the basis of Trotskyism, a prime school of Marxist thought that opposes the theories of Stalinism.” [7]
McLellan identified two parts to Trotsky’s social and economic analysis of contemporary Russia: the socio-economic theory of combined and uneven development, and permanent revolution. [8]
Vladimir Lenin was a “Russian revolutionary, politician, and political theorist. He served as head of government of Soviet Russia from 1917 to 1924 and of the Soviet Union from 1922 to 1924. Under his administration, Russia and then the wider Soviet Union became a one-party communist state governed by the Russian Communist Party. Ideologically a communist, he developed a variant of Marxism known as Leninism.” [9]
McLellan describes the five significant contributions by Lenin: the Party, revolution, Imperialism, the national question or national self-determination, and philosophy. [10]
Russian Marxism in the 1920s focused on how to develop an industrialised socialist economy in a backwards peasant country. The first economic measures in 1917 were relatively moderate: selective nationalisation, eight hour working day, redistribution of nationalised land (Decree on Land) and some workers control.
In 1918 Lenin brought in ‘state capitalism’. This involved a centralisation of the control of the economy by increased labour discipline, wages incentives and managerial authority. There was also a compromise with larger financial interests so the attack on capitalism was suspended.
The start of the Russian civil war in the summer of 1918 made state capitalism ineffective. To survive the Russian government brought in ‘War Communism’. This included the huge increase of nationalisations of all large scale enterprises, runaway inflation causes the government to requisition supplies from the peasants, when the civil war ended demobilised soldiers took on urgent industrial tasks.
The New Economic Policy (NEP) was introduced in 1921 and was a move back to a more market-oriented approach between agriculture and industry. Peasants could keep a fixed amount of their surplus to sell. Small scale enterprises were denationalised.
Socialism in One Country was implemented in 1928/9 by Joseph Stalin, following the failed revolutions in Europe. Russia strengthened itself internally through rapid industrialisation and mass collectivisation of agriculture. Following years of crisis and war, it was promoted as a policy of economic progress. It harnessed nationalistic sentiments so people felt proud of Russias economic independence. [11]
Stalinism was the political regime of Joseph Stalin in Russia from the 1920s until he died in 1953. He introduced a five-year plan in 1928/29 to rapidly increase industralisation and the large scale collectivisation of agriculture. These policies and shortages of food resulted in millions of deaths. Stalin also conducted political purges in the late 1930s and large scale murder of political opponents. Stalin’s theoretical contributions include Socialism in One Country, The History of the All-Union Communist Party (Bolsheviks): Short Course), ‘revolution from above’ – the introduction of the different economic policies. [12]
Post-Stalin Communism in Russia did little to develop Marxist ideas. There were advances in Eastern Europe. In Poland, a government economics advisor Oskar Lange advocated the “use of market pricing tools in socialist systems and providing a model of market socialism.” wrote several essays critiquing Marxism. Adam Schaff wrote about integrating linguistics into Marxism, alienation, and the slow rate it takes to abolish the state and social institutions under Socialism. In Czechoslovakia, a loosening of Russia’s influences “led the Czechs to rejuvenate their Marxism by drawing on their long democratic and cultural tradition, a process that culminated in the ‘Prague Spring’ of 1968.” Ota Sik described the importance of market relations under socialism and giving worker collectives plenty of autonomy – planning was important but needed feedback from producers. Karel Kosik reinterpreted Marx’s work with a focus on human consciousness. Yugoslavian Marxists were critical of the Soviet Union since 1948 about its bureaucracy, the state, the Leninist party. Yugoslavia saw a revival of Marxist humanist philosophy. [13]
3. European Marxism between the wars
Georg Lukács was a Hungarian Marxist philosopher, literary historian and critic. He used the philosophy of Hegel to conceptualise the problems of his time. In History and Class Consciousness he wrote on class consciousness, reification and totality. Later he wrote about Leninism and vanguard-party revolution. He was a supporter and then critic of Stalin. Lukács was supportive of Rosa Luxemburg and workers’ councils. [14]
Karl Korsch was a German Marxist theoretician and political philosopher. He believed the 1918-20 German revolution had failed because of a lack of ideological preparation and leadership of the working class. He supported workers’ councils and focused his research and writing how to build an alternative economic system. He published Marxism and Philosophy in 1923, which attempted to understand the evolution of Marxist theory by applying Marx’s and Hegel’s ideas to Marxism. He identified three phases of Marxism: from Marx to 1848, 1848 to 1900, 1900 onwards. [15]
Council Communism was inspired by the Soviets or workers’ councils during 1917-23 in Russia. Council Communists rejected parliamentary institutions, trade unions and the Leninist party form and vanguardism. They were active in Europe in the 1920s and included Antonie Pannekoek, Georg Lukács, Karl Korsch, Rose Luxemburg, Herman Gorter and Otto Ruhle. [16]
Antonio Gramsci (1891-1937) was an Italian Marxist philosopher and communist politician. He was critical of the economic determinism of traditional Marxism so is considered a key neo-Marxist (see neo-Marxism sections at bottom of post). McLellan divides his life into four periods. Up to 1918, he developed his critique of Marxism and was a member of the Italian Socialist Party (PSI). From 1919-20, he was a leader in the Factory Councils movement in Turin and editor of its newspaper. From 1921-26 he was one of the leaders of the Communist Party of Italy (PCI). From 1926-37 (until his death) he was a prisoner and wrote his major theoretical contribution, the Prison Notebooks. McLellan identifies the main themes of the Prison Notebooks to be: the extended role assigned to intellectuals, the importance of the concept of hegemony, which led to different strategies for revolution in the West and East. [17]
“Gramsci is best known for his theory of cultural hegemony, which describes how the state and ruling capitalist class – the bourgeoisie – use cultural institutions to maintain power in capitalist societies. The bourgeoisie, in Gramsci’s view, develops a hegemonic culture using ideology rather than violence, economic force, or coercion. Hegemonic culture propagates its own values and norms so that they become the ‘common sense’ values of all and thus maintain the status quo. Hegemonic power is therefore used to maintain consent to the capitalist order, rather than coercive power using force to maintain order. This cultural hegemony is produced and reproduced by the dominant class through the institutions that form the superstructure.” [18]
4. China and Third World
The Making of the Chinese Revolution – the Communist Party of China or CCP was founded in 1921. It formed an alliance with the Kuomintang or KMT (Chinese Nationalist Party) which then the KMT broke in 1927 and CCP members were targeted and killed. The Communists retreated to the countryside and set up local bases. This is when Mao Zedong recognised the central role of peasants in the revolution as they had more progressive political and economic aims than the workers. In the early 1930s, the KMT made several attempts to encircle the Communists to defeat them. The KMT’s fifth encirclement campaign in 1933 was successful leading to the Communist’s Long March of 6000 miles in 1934 for twelve months to set up a secure base in northwest China. Following this Mao became the undisputed leader of the party. Communist power in China expanded between 1935-49, first with a United Front with the KMT to resist the Japanese invasion. This was followed by the Chinese Civil War 1945-49 with the Communist victory over the KMT. [19]
McLellan describes Mao’s major contribution to the theory and practice of Marxism was his ideas on “guerilla tactics and the strategy to be adopted in a lengthy struggle against a militarily superior opponent.” Mao gave the CCP a philosophical basis in the form of two essays: On Practice and On Contradiction. [20]
Maoism in Power – The Chinese Communist Party inherited a ruined economy and a threat of famine in the cities. With a well-organised party infrastructure, support from the Soviet Union and the goodwill of the Chinese people several financial measures were introduced to fairly distribute tax and bring inflation under control. Large capitalist businesses were nationalised and smaller businesses were left alone. The party introduced the Land Law in 1950, which guaranteed each individual at the age of 16 their own land holding of about one hectare. This involved the execution of hundreds of thousands of landlords. Since 1953, China has organised its society through a series of social and economic development initiatives called Five Year Plans.
Maoism was focused on the Party and the peasantry. The ‘proletariat’ became a reference to proletarian moral qualities that could be presented to the masses as a norm of true collectivist behaviour. Maoism substituted the proletariat with the Party because the peasantry were not ‘sufficiently socialist’, which resulted in the authoritarian nature of the Party. Officially the Party adopted Lenin’s democratic centralism but the highly hierarchical nature of the Party resulted in it being more centralism than democracy. Freedom of discussion was allowed but once a decision was made, everyone had to obey. Mao introduced the ‘mass line’, of consulting the masses and then interpreting their responses within the Marxism-Leninism framework, and then implementing the resulting policies. Government decision making was made at the top of the Party, not through state departments. There was a lot of secrecy about how decisions were made. Mao was not a dictator and had to play other leaders in the party off against each other.
The Hundred Flower Campaign started in 1956 when the Party encouraged people to share their opinions about the communist regime. This was followed by Mao repressing those that were critical of the regime. The Cultural Revolution was a mass campaign that began in 1966 to remove the ‘Rightists’ or capitalists from China and to re-establish the importance of Mao’s thinking. There were problems with the roll out of the campaign – resistance to it and supportive groups splitting into factions and fighting each other. The army had to step in frequently. The Cultural Revolution ended in 1969 with an expanded Central Committee, the majority were new, and a new constitution.
Chinese Marxism was more focused on human and moral factors – the superstructure – compared to the Soviet Union that was more focused on economics and production – the base. Mao believed that ‘class’ was a subjective concept that was determined by a person’s attitude rather than their social origins.
McLellan describes Maoism as a “synthesis of Leninism and China’s economic backwardness with the addition of certain traditional Chinese ideas.” It retains the key Marxist concepts of “class analysis, working-class leadership, the idea of history moving through stages, and a social theory infused by the concepts of dialectical materialism and contradiction.”
He lists the central ideas of Maoism as
- China aimed to develop the agricultural sector in harmony with the industrial sector.
- to follow the Marxist doctrine of the proletariat, then it was necessary to develop a proletariat or social consciousness into the peasantry.
- Mao’s ideas on guerrilla war, developed in the 1930s, involved the active engagement of the peasantry and had wide-spread influence in less developed countries.
- Maoism encourages “emphasis on thrift and devotion to the common good.”
Marxists in other Asian countries attempted socio-economic analyses of their societies to develop strategies to gain power. These countries included Vietnam, North Korea, Kampuchea (Cambodia), Japan, India, Indonesia. Asian Marxism has mostly been Marxist-Leninist and violent with the used of guerrilla warfare. Asian Marxism was more focused on the superstructure and consciousness. [21]
Latin America was first introduced to Marxist Communism in the 1920s. It was seen to be protecting the interests of the small numbers of industrial proletariat resulting in the masses being influenced by populist or corporatists ideas such as Peronism. Communist parties were more focused on defending a specific interest group rather than following the Marxist-Leninist route. Alternative versions of Marxism follow on from Peruvian Marxist José Carlos Mariátegui, who adapted Marxist to national circumstances, especially in relation to the indigenous struggle.
The Cuban revolution 1953-58, lead by Castro, took inspiration from traditional national liberation struggles against Spain and the US, and did not originate from the working class or the Communist Party. The working class did support the rebels, and the Communist Party also supported the rebels once it became clear they would be successful. The Cuban government declared itself socialist when it set up a new revolutionary party (PRS) in 1961. The new government introduced nationalist and agrarian cooperative policies resulting in boycotts from the US and the Cuban bourgeoise emigrating to the US. This combined with the failed US-backed invasion at the Bay of Pigs, resulted in Cuban politics becoming more radical.
McLellan explains that violent revolution was rejected by Communist parties in Brazil, Colombia, Venezuela and Peru. This was supported by the Soviet Union because it wanted to improve diplomatic and commercial relations with these countries.
The revolutionary guerrilla approach of Che Guevara and Regis Debray was based on the Cuban revolution and can be contrasted with the orthodox communist in Latin America, who advocated the classical Marxist process of stages. For them, Latin America needed a ‘democratic’ revolution, followed by a socialist revolution. Therefore, communists should engage in parliamentary and electoral activities.
Liberation theology was developed in the 1950/60s by Marxist Christians and focused on “social concern for the poor and political liberation for oppressed peoples”. It was most significant in Argentina, Uruguay, Chile, Peru and Brazil. [22]
Marxism and Underdevelopment relate to the neo-Marxist theories of imperialism and underdevelopment (For more on neo-Marxism, see the section at bottom of post). Marx wrote about Colonisation, specifically of the British in India. Lenin wrote about Imperialism, and Trotsky had his theory of combined and uneven development. Luxemburg wrote about capitalism’s need to constantly expand into non-capitalist places to find more resources, markets for good and more workers. Imperialism is generally seen as a necessary development of capitalist economies that need raw materials, to find foreign places to invest in, and to find markets for commercial products.
The key neo-Marxist text on underdevelopment is Paul Baran’s The Political Economy of Growth, which “expanded on the ideas of Lenin, Luxemburg, and Trotsky by linking them with the claim that the development of the West was directly at the expense of the less developed economies.”
Other underdevelopment theorists included Samir Amin, Andre Gunder Frank, Immanuel Wallerstein. [23]
5. Contemporary Marxism in Europe and the US
The Frankfurt School was associated with the Institute for Social Research, which was founded in 1923. The rise of Hitler resulted in the emigration of the Institute’s members (most were Jews) to New Year to re-establish in 1936. Max Horkheimer became Director in 1930, resulting in the ideas the Frankfurt School is well known for. Members of the Institute reject Social Democrat reformism and the doctrines of Soviet Union communism. Members re-examined Marxist thought, focusing on the cultural superstructure of capitalist society.
Horkheimer and his collaborator Theodor Adorno were inspired by the Council Communists from the 1920s such as Korsh and Lukács (see above). The Frankfurt School attempted to integrate non-Marxist disciplines such as psychoanalysis. They were influenced by idealist philosophers such as Schopenhauer, Kant, and by ‘irrationalism’ thinkers such as Nietzsche, Dilthey, and Bergson. They saw this irrationality as a “protest against the abstract uniformity that increasingly oppressed the individual in advanced capitalist society.”
McLellan describes how they saw the importance of the economy in capitalist society but failed to integrate their work in economics into their analysis of society as a whole. They did not have a specific programme for social change but did have a commitment to proletariat struggle and valued the importance of praxis. They saw their work as to clarify the opposing forces in society, to raise class consciousness of the exploited and provide them with a weapon in their struggle for emancipation.
Critical Theory is the “reflective assessment and critique of society and culture by applying knowledge from the social sciences and the humanities to reveal and challenge power structures. It argues that social problems are influenced and created more by societal structures and cultural assumptions than by individual and psychological factors. Critical theory has origins in sociology and also in literary criticism.” [24] . Critical Theory was inspired by the Western philosophical tradition especially the Enlightenment.
The Frankfurt school broadened their critique of capitalist society by adding the insights from psychoanalysis (the study of the unconsciousness mind), especially the work of Freud. They also analysed the spread of mass culture and the nature and development of authority. Wilhelm Reich showed the Marxism and psychoanalysis were compatible and that life was regulated by the ‘pleasure principle’ and limited by the ‘reality principle’. So the ruling class, use the reality principle to maintain their power – capitalist society is presented and accepted by many as the norm and unchangeable.
There were several theorists involved in the Frankfurt School, see a list here. McLellan notes Herbert Marcuse and Jürgen Habermas as making the most significant contributions.
Erich Fromm combined Marxism and psychoanalysis and was focused on the “emotional conflict produced by social interaction than in any theory of instincts” – so how individuals relate to the world. His key theme was how people’s feelings of powerless and loneliness are caused by being unable to live an “authentic, spontaneous life under contemporary political and economic arrangements”, which was the basis of authoritarianism.
The Frankfurt School’s analysis of Fascism focused on the “psychosocial mechanism of authority and violence at the expense of detailed examination of economic substructure.” They saw and direct link between capitalism and Fascism – capitalist economies evolved towards monopolies and liberalism evolved towards totalitarianism. Franz Neumann wrote about Nazism that it was a monopolistic economy and a command economy, ‘Totalitarian Monopoly capitalism’. There was still the profit motive and it needed totalitarian political power to support it, so the same people benefited, those who benefited from old monopoly capitalism.
The Frankfurt School made a large contribution to aesthetics or the philosophy of art The focus on culture was reinforced by how the US had achieved conformism through the spread of mass culture, instead of repression. Similar to Fascism, the difference between the private and public worlds had been broken down by creating needs in people to ‘support a particular system of domination’. They were critical of mass culture because it was forced on people and not created by them, serving the interests of domination. [25]
Existentialist Marxism developed in France following the Second World War. It was influenced by Hegel and the publishing of Marx’s early writings. The war had challenged the analytical rationalism of French philosophy. There was interest in Hegel’s philosophy of history, alienation, dialectic and consciousness concepts. Alexandre Kojeve and Jean Hyppolite lectured on Hegel in the 1930s and were very influential on the existential thinkers.
The radical interpretation of Hegel and incorporation of Marx’s early writings were in opposition to the Stalin controlled French Communist Party. The Communist Party held a conservative position in French politics and its philosophy was limited to Stalin’s laws of dialectical materialism. Many of the Marxist thinkers started in the Communist Party and were thrown out for their new thinking. The new perspectives showed that an alternative Marxism was possible. The concepts of alienation and praxis were recovered that had been lost under Stalinism. Marx’s ideas around alienation were felt to be particularly relevant to the complex, highly developed societies that were developing. French social theorists were also reading earlier ‘Western Marxist‘ theorists such as Lukacs, Korsch and the Frankfurt School (see sections above).
Henri Lefebvre was a humanist and saw the idea of praxis as a dialectical relationship between man and nature. Lefebvre most important work was Everyday Life in the Modern World, where he looked at alienation in everyday life.
McLellan describes Jean-Paul Sartre’s work as the best example of combining existentialism and Marxism. He protested on how modern technology treated men as things, wrote about freedom being the core of human existence, was critical of Stalin’s’ description of materialism and was supportive of a workers Party to achieve freedom. McLellan describes how Sartre combined sociology and psychology into a framework of genuine dialectical Marxism. He wrote about the dialectic, comparing ‘dogmatic dialectic’ with ‘critical dialectic’. He wrote about how the social relations of individuals emerged in relation to scarcity.
Two further French revisions of Marxism in the late 1950s and early 1960s were the theorists of the ‘New Working Class’ influenced by the Frankfurt School and Lefebvre: the magazine Arguments (1956–1962), and Socialisme ou Barbarie. Arguments explore Marx’s ideas on philosophy, how to apply the concept of alienation to a society that valued leisure as much as work, and the “cultural superstructure as much as politics or economics. The Arguments group were Kostas Axelow, Fougeyrollas, Morin and Chatelet. Socialisme ou Barbarie was made up of ex-Trotskyist writers, such as Claude Lefort and Cornelius Castoriadis, who analysed the problems of modern bureaucratization. André Gorz and Serge Mallet reassessed class struggle in Western countries. [26]
Italian Marxism since the 1950s has developed in several ways. From the Italian Communist Party in the 1950s/60s, Della Volpe and his followers rejected Hegelian interpretations of Marxism. They focused on philosophy, and methodology or scientific over sociology and economics. He was critical of idealism and Gramsci. We wrote about aesthetics and developed a materialist of aesthetics. Lucio Colletti was also critical of Hegelian idealism, instead advocating scientific materialism. He also valued the concept of alienation. Sebastiano Timpanaro focused on materialism and rejected combining Marxist materialism with psychoanalysis or structuralism.
McLellan writes “more recently, writers such as Badaloni and Lusurdo have produced innovating working, the former using Marx and Gramsci to produce a radical theory of democracy, the latter building on his critical history of liberal thought and practice to reformulate Marx’s political theory.”
McLellan describes the autonomista movement which formed by rejected the Communist Party (PCI) and Trade Union bureaucracy. It reframed workers to be powerful instead of passive, when not betrayed by their leaders as in the summer of 1968. Mario Tronti and others were strongly critical of the “orthodoxy of development of forces of production through determined stages and the gradualism of the PCI.” The argued that the growth of service jobs meant that the “regime of the factory had been extended to society as a whole with the proletarianisation of whole swathes of white-collar workers.” Antonio Negri expanded this to develop a theory of history where instead of the profit motive being the ‘motor force of capitalism’, it was class struggle: “Fordism was designed to overcome the resistance to capital of skilled workers and artisans; but the organized resistance of factory labour to capital led to technological innovation which permitted it to restructure labour away from factories (or overseas) into flexible, part-time, service sectors.” This would result in unwaged and Third World workers building resistance internationally: “with the arrival of immaterial labour and mass intellectuality, the time would soon be ripe for workers to revolt in such a manner as to rupture the self-reproduction of capital and liberate work from it.” [27] (see more on Italian Marxism – Operaismo or Workerism, Autonomia, Autonomist Marxismlist – in libertarian Marxism tenancies)
Structural Marxism developed in France in the mid-1960s. The major thinker is the French philosopher Louis Althusser, who rejected humanist Marxism of Lukács, Sartre and Gramsci, which saw men as the ‘subjects of history’; and the economic focus of traditional dialectical materialism. Structural Marxism identifies Marxism as a science that examines objective structures. The Structural Marxists were seeking an alternative to the base-and-superstructure model that gave equal weight to economic, political and ideological ‘structures’. These were called ‘structural instances’ or ‘regional structures’ and combined to form a ‘social formation’ that related to a mode of production.
Althusser believed that Marx’s work had a scientific conception of history but there were theoretical gaps. Althusser was trying to identify what Marxist philosophy was. He rejected the humanism in Marx’s early work and saw an ‘epistemological break’ between young Marx and mature Marx. He saw Marx’s early work as focusing on alienation, species being and the ‘ideological problematic of the subject’. Marx’s later work resulted in the development of a science. Althusser stated that ‘history is a process without a subject or a goal’.
Althusser argued that each instance or level develops at different rates and times. Althusser described how this complex and uneven relationship between the instances related to each other at a specific time a ‘conjuncture’. He rejected the idea that there was a simple relationship between ‘social forces’ and ‘relations of production’, or between base and superstructure.
Althusser in his essay Ideology and Ideological State Apparatuses, identified Repressive State Apparatuses (RPAs) and Ideological State Apparatuses (ISAs) such as trade unions, churches and schools. He described the ISAs as important sites of class struggle.
Nicos Poulantzas applied Althusser’s ideas to the state and classes. He argued against the orthodox communist view that that state is the direct servant of the capitalist or ruling class, with individuals in specific positions of power. Instead, the institutions of the state operate to ensure capitalism continues and to reproduce capitalist society as a whole. [28]
British Marxism began in 1881 with the Social Democratic Federation, set up to promote Chartist ideas, sharing Marx’s ideas. The Independent Labour Party forming in 1893 did not promote Marxism, revolution and class confrontation, instead favouring a gradualist approach to socialism. In the early twentieth century, there were three main Marxist organisation in Britain: British Socialist Party, Socialist Labour Party, and Workers’ Socialist Federation.
The Communist Party of Great Britain (CPGB) formed in 1920. This did not form from a split in the main social democratic party like in Europe, so attempted to affiliate to the Labour Party but was rejected. The CPGB was encouraged to operate as the left-wing of the Labour Party following The United Front as instructed by Moscow. McLellan states that the CPGB made little progress in the 1930s, although did attract several intellectuals. McLellan describes Christopher Caudwell as the only original pre-war British Marxist but he died young in the Spanish Civil War.
McLellan describes how after 1956 several varieties of Marxism developed in Britain following the different forms of Communism that developing in the world – Soviet, Chinese, Cuban. The New Left formed with the New Left Review as its main publication.
The CPGB remained small and focused on trying to push the Labour Party leftwards, which was not a revolutionary programme. McLellan states that the revolutionary left in Britain has become “synonymous with Trotskyism.”. The largest group being the Socialist Workers’ Party (formally International Socialists), also the International Marxist Group. (I will write future posts on the history and current British Left).
McLellan describes the key thinkers of British Marxism. Perry Anderson and Tom Nairn wrote controversially about Britain’s bourgeois revolutions and why Britain didn’t develop in a ‘normal way’. There is also an older generation such as Edward Thompson, and John Saville. Marxist historians focused on “detailed, empirical, narrative history ‘from below’”, including Gordon Childe, Maurice Dobb, Christopher Hill, Rodney Hilton and Eric Hobsbawm.
McLellan describes how Anderson, through the New Left Review was aiming to assimilate European Marxism to the ‘perceived insular backwardness of British culture.” Anderson focused more on institutions, with a more abstract analysis that aimed to provide a “comprehensive theory of the modern bourgeois state as it evolved in the West.” Those at the New Left Review briefly engaged with Althusser’s structural marxism. McLellan describes a clear debate between theoreticians and a “more native empirical approach.”
In the field of literature and culture broadly, Raymond Williams was the main figure and “produced a libertarian version of Marxism which emphasised the cultural possibilities for social change and the capacity for individuals and groups to modify their conditions of existence.” Terry Eagleton is a well known Marxist critic of Williams. The view that culture and ideology as the sites of domination and resistance came from the Centre for Contemporary Cultural Studies in Birmingham, run by Stuart Hall. It focused on “ideological struggle around politics and institutions” with Gramsci being the main influence.
McLellan describes British political economy as one of the major areas of Marxist thought. This includes debates of the “labour theory of value, the relations of value to price, and the falling rate of profit.” Rowthron wrote an analysis of the influence of British institutions on the British economy. Then Armstrong, Glyn and Harrison wrote about the importance of overaccumulation in explaining the crises of the 1970s.
There was much analysis of the Soviet Union. Trotsky described it as a ‘degenerated workers state.’ Tony Cliff described the Soviet Union as ‘bureaucratic state capitalism’ – the Soviet bureaucracy controlled the economy and the state, another form of an exploiting class. Hillel Ticktin and the people around the journal Critique did a detailed analysis of the workings of the Soviet Union so were not surprised by its collapse.
The Miliband–Poulantzas debate between Ralph Miliband who viewed the “British state as an instrument serving the interests of the bourgeoisie since it was dominated by them through a network of interpersonal relations”, and Nicos Poulantzas, a structural Marxist, who saw the capitalist state as a system that functioned independently of the ‘mindset of the ruling class’. Bob Jessop then wrote about the transition from the Keynesian welfare state under ‘Fordism‘ – “mass production, mass consumption, and massive semi-skilled labour” to ‘post-Fordism‘ where “permanent innovation and labour flexibility in an increasingly globalised economy means the subordination of welfare to the discipline of the labour market.” Jessop has written extensively about the state and combines European structuralist and British agency approaches that make up British Marxist divisions. [29]
Marxism in the United States started with Joseph Wydemeyer who set up the unsuccessful American Workers’ League in New York City in 1856. The First International had limited influence in the US. By 1872 there were several sections, with Frederick Sorge as secretary. In 1876 the Socialist Party of North America (SLP) was formed with limited success. There was an increase in trade union activity in the 1880s resulting in the formation of the American Federation of Labor (AFL) and the Knights of Labor. They campaigned for an eight-hour day and worked with the new Independent Labor Party. Daniel De Leon was the leading spokesman for the SLP and an uncompromising Marxist. De Leon rejected the American Federation of Labor philosophy of non-political trade unionism. The SLP split in 1899 when a large number left to set up the Socialist Party, which was more supportive of the trade unions. De Leon was part of founding the International Workers of the World (IWW) in 1905, a proletarian and revolutionary trade union. The IWW evolved along syndicalist lines with a belief in direct action and sabotage. This was in opposition to Marxists so De Leon was ejected in 1908.
The Socialist Party (SP) membership grew to over one hundred thousand by 1912. It President, Eugene Debs got almost one million votes in the 1912 presidential election. The SP was not strongly influenced by Marx according to McLellan, being ideological broad. It had three main tendencies: “a right-wing led by Victor Berger and composed of the municipal reformers of the Mid-West; a centre based on the Eastern seaboard, and led by Morris Hillquit who had left the SLP in 1899; and the left, drawing its strength from the West and led by Debs.” McLellan describes the years before the First World War as a time of a ‘lyrical left’, where socialists ideas combined with many art forms. The war resulted in the repression of socialists that opposed it.
Following the Bolshevik revolution in Russia in 1917 and the formation of the Third International in 1919, a number left the SL to for the Communist Party (CP). A Community Labour Party also formed of mainly native Americans. They had limited success in engaging with electoral and trade union politics. The CP had splits in the 1920s related to positions on the Soviet Union. Followers of Trotsky were expelled and formed two groups: the Workers’ Party (later the Independent Socialist League); and the Socialist Workers’ Party. There was also the independently radical American Workers’ Party founded in 1934. During the 1930s the CP made gains and the SP declined. The SLP remained small. The CP become influential in the new Confederation of Industrial Organisations (CIO) and had almost one hundred thousand members by 1943. After the Second World War, the economic boom and McCarthyism resulted in a decline of the CP and Marxism in general until 1960.
The revival of Marxism took a different form in the radicalism from the early 1960s in the form of the New Left in response to the Vietnam War and increasing understanding of the levels of widespread poverty and misery of workers. There was also the civil rights movement in the south that raised the suffering of people of colour. The feminism movement grew in response to the conformist, patriarchal society of the 1950s. The Old Left rejected the New Lefts humanism, moralism, individualism, idealism and its positions that were more linked with anarchism than the ‘class-based social and political analyses of Marxism.’
The New Left had a student base, the main organisation was Students for a Democratic Society (SDS) (originally Students’ League for Industrial Democracy). The SDS started with agitation for more student power in universities. The SDS developed a “New Working Class’ theory: “students were being trained in knowledge factories to fit the bureaucratic demands of advanced capitalism in which they would be as exploited and alienated as the industrial proletariat of the nineteenth century but at the same time possess a radical consciousness of that situation that would enable them to resist it more effectively.”
C. Wright Mills was very influential on the New Left with the book The Power Elite which describes the relationships and class alliances among the US political, military, and economic elites. He rejected the idea that the working class of advanced capitalist society is a historic agent. Erich Fromm’s work on alienation and Herbert Marcus’s Marxist humanism were influential on the New Left. The SDS evolved from reform, to resistance and then revolution as it was taken over by determined minorities to tackle more complex issues such as Imperialism.
The 1960s also saw a revival of the CP, the Trotskyists, the Maoists and all their youth wings. The most successful was the Trotskyist Young Socialist Alliance set up by the Socialist Workers’ Party. There was also the Johnson-Forest Tendency a radical left Marxist humanist group. The Progressive Labor Party was Marxist Leninist that aligned themselves with black nationalists such as the Black Panthers. At the 1969 SDS convention, the Progressive Labor Party gained control resulting in brief activities by guerrilla groups such as the Revolutionary Youth Movement and the Weather Underground. Following the decision to withdraw from Vietnam the left’s agitation declined.
McLellan describes the growth of interest in Marxist theory in the 1960/70s, with many books and journals being published. These can be grouped into three broad areas: “the theories of the New Left about the nature of contemporary American society, the historiography of the United State from a Marxist standpoint, and, most importantly, the economic studies of American capitalism.” The 1980s saw a revival of American capitalism and interest in how to combine the market and socialism. There were two versions of market socialism: “maximisation and equal distribution of profit while the other centres on workers’ control of the means of production.” The 1980s also saw the development of Analytical Marxism or ‘rational choice’ Marxism: “this approach combines the rigorousness of contemporary Anglo-Saxon analytical philosophy with a conception of society as consisting of self-interested individuals reminiscent of neoclassical economics.”
McLellan describes Fredric Jameson as the “most prominent American intellectual working within the Marxist tradition.” Jameson has produced and important account of postmodernism and Western Marxism. In his book, The Political Unconscious, his ‘basic theoretical work”, Jameson describes his Marxist approach to culture. He has also written about politics and class consciousness, ideology and utopia. McLellan describes how Jameson’s sources are wide-ranging and he writes in ‘broad sweep’ in a sort of ‘grand narrative that has gone our fashion. His later work has a focus on space as important for understanding the globalised world. Here he builds on the work of French Marxist Henri Lefebvre.
US Marxism has seen a lot of interest in globalisation and empire. McLellan describes three significant recent socio-economic developments: a high volume of activity on world financial markets; increase in, and increasingly integrated nature of world trade; globalisation is more than an economic process, it is the transformation and compression of time and space for all those who live in it. McLellan states that the “most globalised of all the accounts of globalisation is that of Michael Hardt and Antonio Negri”, in the Empire series of books. For Ellen Meiksins Wood “globalisation is a response to the crisis of overcapacity and overproduction beginning in the 1970s. It is not concerned with free trade or integrating the world market.” For Wood, nothing has come close to replacing the nation-state and its importance for maintaining capitalism. The US reliance on other nation-states and economic decline have resulted in increasing militarism and wars without end.
When considering political economy, the two main questions fro Marxists are explaining the repeating US economic crises and is it in long-term decline. These questions have been considered by Robert Brenner, Giovanni Arrighi, and David Harvey. [30]
Postmodern Marxism (also known as post-Marxism) is described by McLellan as a ‘new mode of social production’ that emerged in the 1970s. He lists four contextual changes that took places in the 1970s that led to postmodernism: increasing impact of electronic communications; the change in the mode of economic production from Fordism to post-Fordism; the defeat of 1960s emancipatory forces by the neoliberalism of Thatcher and Reagan; and in philosophy, structuralism was influential, then the post-structuralists advocated ignoring claims to objectivity and truth.
McLellan describes postmodernism to be in strong opposition to a ‘metanarrative’ – “any view which aims to give a unified, consistent, and objective account of the world by unifying the different narratives in one overarching framework.” He describes how “postmodern thought rejects the legacy of the Enlightenment which attempts to ground its approach to the world ideas of universal applicability – common human nature, reason – which would reveal the way the world actually was. In postmodernism, by contrast, the emphasis is on diversification, particularity, and difference.” McLellan describes how postmodernism has little in common with Marxism. It is the opposite of classical Marxism, where the economic base influences the superstructure. Postmodernism merges everything into a vague cultural superstructure.
McLellan lists the key postmodernist thinkers: Jean-François Lyotard writing on narratives, knowledge, science; Michel Foucault who focused on the origins of psychiatry, modern prisons, history of sexuality, and the concepts of power and anti-system; Gilles Deleuze and Félix Guattari who wrote about Freud and orthodox psychoanalysis, with the concept of desire being central; Jacques Derrida who focuses on language and concept of difference.
McLellan describes how one of the main features of postmodernism is the focus on difference” “Classical Marxism offered a united front of opposition to capitalism based on the working class, many of the proponents of postmodernism have moved from the revolutionary hopes for global transformation of the 1960s to enthusiasm for single issues and the new social movements of, for example, feminists, ecologists, or anti-racists.”
McLellan describes the best example of the postmodernist approach to Marxism as the book Hegemony and Socialist Strategy by Ernesto Laclau and Chantal Mouffe. They describe Marxism as on ’emancipatory discourse’ amongst many, that is compatible with feminism, anti-racism etc. The Gramsci concept of Hegemony is central.
The Marxists that have been critical of postmodernism include Fredric Jameson in Postmodernism, or, the Cultural Logic of Late Capitalism, David Harvey in The Condition of Postmodernity; Jürgen Habermas; John Urry and Scott Lash; Terry Eagleton; Alex Callinicos. [31]
Seven Stages of Marxism
Gregory Claeys in Marx and Marxism divides Marxism into seven stages:
- Marx and Engels’ attempts to form a ‘Marx party’ following 1848.
- The growth and German Social Democracy and reformism up to 1914.
- The Russian Revolution, Lenin and dialectical materialism from 1917 to 1937.
- The Chinese Revolution of 1949.
- After 1945, Marxism-Leninism spreading through the Third World.
- 1950s to 1980s limited development of Marxism in command economics such as Russia. In parallel is a revival of interest in Marx, based on his early writings.
- The collapse of the Soviet Union 1989-91, followed by the transformation in China and Vietnam, extreme Stalinism in North Korea, and moderate versions in Cuba and Belarus.
[32]
Marxism after Marx – libertarian Marxism tenancies
This is based on this map on libcom.org. See here for a description of liberatarian socialism.
Rosa Luxemberg was a democratic socialist but critical of both ‘bourgeois democracy’ and the centralising tendencies of socialism. She valued international solidarity and the spontaneity of revolutionary action. She was a humanist because she believed in the human potential for social and political transformation. [33]
Council Communists see Council Communism above in McLellan section
G.I.K. Group of International Communists was a left communist dutch group in the 1920s that advocated council communism. It ideas we influenced by the Russia Revolution 1917 and the Germany Revolution 1918. [34]
Socialism or Barbarism (Socialisme ou Barbarie in French) was a French libertarian socialist group from 1948 to 1967. The name comes from Rosa Luxemburg. That had a journal of the same name. The dominant character was Cornelius Castoriadis. The group was critical of Leninism and the idea of a revolutionary party. They advocated workers’ councils.
Letterist and Situationist International – The Letterist International was a radical Paris based collective of artists and cultural theorists from 1952 to 1957. It was set up by Guy Debord after falling out with Isidore Isou’s Letterism group. They went on to join up with other groups to form the Situationist International
Situationist International – the Situationist International was a European organisation made up of avant-garde artists, intellectuals and political theorists from 1957 to 1972. It was based on libertarian or anti-authoritarian Marxism and art movements from the early twentieth century. They were influenced by early Hegelian Marxism (or Western Marxism), the Frankfurt School, Henri Lefebvre, council communist ideas and Socialism or Barbarism. Later they focused on revolutionary and political theory. They attempted to synthesize a broad range of theoretical disciplines to develop a comprehensive critique of twentieth-century capitalism. They agreed with the classical Marxism analysis of the capitalist mode of production, but it needed updating. They emphasised Marxist concepts such as alienation and commodity fetishism. They rejected the claims by advanced capitalism that technology innovation, higher standards of living and more leisure, could outweigh the negative social impacts on people’s everyday lives. A key situationist concept was ‘the spectacle’, a critique of advanced capitalism’s social relations through objects and consumption of commodities. Their way of counteracting the spectacle was through the construction of situations “moments of life deliberately constructed for the purpose of reawakening and pursuing authentic desires, experiencing the feelings of life and adventure, and the liberation of everyday life.” Their two key texts were The Society of the Spectacle by Guy Debord and The Revolution of Everyday Life by Raoul Vaneigem. These texts were very influential to the May 1968 insurrections in France.
Early Hegalian Marxism – see Georg Lukács and Karl Korsch sections above. There is also Evgeny Pashukanis and I.I. Rubin
Frankfurt School, see McLellan section above
Johnson-Forest Tendency formed in the 1940s within US Trotskyism. The founders were CLR James (Johnson), Raya Dunayevskaya (Forest) and Grace Lee. They wrote a critique of the Soviet Union as a capitalist society, referring to it as ‘state-capitalism’. They were influenced by Humanist Marxism, Hegel, Marx and Lenin, having split from Trotskyism by 1948. In 1950 the published State Capitalism and World Revolution. Splits in the Johnson-Forest Tendency led to new groups Correspondence Publishing Committee 1951-62 and Facing Reality 1962-70.
Raya Dunayevskaya 1910 – 1987 was a Russian who moved to the US and was the founder of Marxist Humanism there. She was also known as Rae Spiegel and the pseudonym Freddie Forest. After splitting from Johnson-Forest Tendency she founded the organisation News and Letters Committees and the Marxist-Humanist newspaper, News & Letters.
CLR James 1901-89 was a Trinidadian historian, journalist and socialist, who wrote under the name J. R. Johnson. He wrote about the history of the Communist International and the Haitian revolution. He moved to Britain in 1932 from Trinidad. Then moved to the US from 1940, where he set up the Johnson-Forest Tendency, he was deported in 1952. He described himself as a Leninist but rejected the vanguard party. Instead, he advocated supporting black nationalist movements.
Amadeo Bordiga 1889-1970, was an Italian Marxist, a founder of the Communist Party of Italy, leader of Communist International (Comintern) and International Communist Party. Following World War 2 he moved to a left communist position. Bordiga developed theories on Stalinism, democracy, the united front, and communism. He inspired several ‘Bordiga groups’ in Italy and France.
Operaismo or Workerism developed in Italy in the early 1960s and emphasises the importance of the working class. It developed in factories as workers were struggling for better wages, working conditions and hours, in the two main left-wing parties PCI (Communist) and PSI (Socialist). Activists were conducting ‘worker inquiries’, analysing the work environment and opportunities for struggle from the worker’s point of view. There was a split in Workerism, with some such a Negri and Bologna rejecting the conservative trade unions and left political parties, who were seen as disciplinary institutions that kept workers in their weak position within capitalism. Others such as Tronti and Asor Rosa returned to the PCI and its associated union confederation Italian General Confederation of Labour (CGIL). This led to a new practice of self-organised labour representation outside the traditional trade unions. They were influenced by the Johnson Forest Tendency in the US and Socialisme ou Barbarie in France. The movement included several journals Quaderni Rossi (“Red Notebooks”, 1961–5), along with its successor Classe Operaia (“Working Class”, 1963–6). There was a series of strikes and occupations of factories by workers and universities by students during the 1960s. The movement was at its height in 1969-70 during the ‘Hot Autumn‘, when there were a series of large strikes in factories in Northern Italy. [35]
Autonomia (Operaia) or Autonomist is the name given for the new youth and student movements that emerged in the early 1970s. The movement was never unified and was made up of changing organisations and shifting alliances in a decentralised network. It was extra-parliamentary and came from the factory, educational and community struggles and included second wave feminism concerns – today this is known as social reproduction theory and was pioneered by Mariarosa Dalla Costa and Selma James. This movement had expanded its critique of capitalism to include all aspects of life, from the struggle in the industrial factory, including occupations, sabotage and strikes, to ‘the social factory‘ and cities where thousands of buildings were squatted between 1969–1975. This social movement gathered around free radio stations and publications in several cities in Italy in the 1970s. The key thinkers and writers included: Antonio Negri, Sergio Bologna, Romano Alquati, Oreste Scalzone, and Franco Piperno. Influential political groups included Potere Operaio from 1967 to 1973 when it merged with the broader movement and Lotta Continua from 1969 to 1976. 1977 saw large demonstrations and the occupations of universities in response to the killing of a Lotta Continua member by police. From 1979 the movement was repressed by the Italian state, which accused it of supporting and protecting the armed Red Brigades. This resulted in thousands of movement activists being arrested or fleeing the country. There is no evidence of a direct link between the Autonomia movement and the Red Brigades. A revival of the movement started in the mid-1980s with the second wave of social centre occupations. [36]
Autonomist Marxism can be described as the theoretical work based on the Operaismo/Workerism and the Autonomia/Autonomist movements described above. A key observation made by Mario Tronti in Lenin in England is the ‘Copernican Inversion’, where he argues that capitalist development of the production process follows working-class struggle instead of going first. Workers are not dependent on capitalism for their existence, they existed before capitalism. Capitalism is dependent on workers, which shows its weakness. The second insight of autonomist Marxism is that it is labour struggles that drive technological development in the production process as capitalists react to worker demands and resistance. For example, workers go on strike and win some demands. In response, capitalists restructure the production process to their advantage making it more difficult for workers to repeat their successes. This links to the concept of class composition and decomposition. When the capitalists change the production process to their advantage and the worker’s disadvantage, this decomposes the workers’ power. The workers then have to find new ways to exert their interests, recompose their power by finding new tactics to interfere with the production process. If they are successful then this will lead to the capitalists restructuring the production process again, starting a new cycle.
Autonomist Marxists argue that the working class can force changes to the way the capitalist system is organised independently from the state, political parties and trade unions. Autonomist Marxists focus on self-organised activities away from traditional left institutions. It promotes “everyday working-class resistance to capitalism, such as absenteeism, slow working, socialization in the workplace, sabotage, and other subversive activities.” [37]
Autonomist Marxists see class struggle as fundamental. And they have a broader definition of the working class than other Marxists. They include manual and office workers, also the unwaged (students, unemployed, homeworkers) who do not normally get trade union representation. Also important are the concepts ‘immaterial labour‘, and the ‘worker inquiry‘ process. They emphasised the Marxist perspective that modern society’s wealth is produced by the collective work of the working class, but very little of this is shared with workers in their wages. Feminist autonomists such as Mariarosa Dalla Costa and Silvia Federici describe the amount of unwaged (but paid indirectly through the male worker’s wage) female labour in capitalist society.
Other key autonomist Marxist thinkers and writers are Antonio Negri, Michael Hardt, Harry Cleaver, Nick Dyer-Witheford and Paulo Virno. There are a number o different strands of autonomist Marxism. There is ‘classic’ Operaismo/Workerism of Panzieri, Alquati, Tronti; post-operaismo of Negri, Virno, Lazzarato; autonomist feminism of Dalla Costa, James, Federici, Fortunati;, ‘American” autonomism’ of Harry Cleaver, George Caffentzis. [38]
post-’68ers German Marxists formed in the late 1960s. The main people included Helmut Reichelt, Hans Jurgen Krahl, and Johannes Agnoli. They were influenced by Council Communism, the early Hegelians, and the Frankfurt School.
Open Marxism is based on libertarian socialist critiques of left-wing political parties. It advocates and openness to praxis, combining theory and practice, and understanding history through an anti-positivist method, when studying the social world a scientific method can not be used. It is close to autonomism, somewhere between autonomism and ‘value form theory‘, which comes more from the Frankfurt School. The ‘open’ refers to a non-deterministic view of history, that history can’t be predicted, and that the unpredictability of class struggle is most significant. Open Marxism is influenced by council communism, anarchism, autonomism and situationalism. There have been several open Marxism journals Arguments (1958–1962), Common Sense (1987–1999) and The Commoner (2001–2012). There is the San Francisco-based working group Kapitalistate and the Conference of Socialist Economists journal Capital & Class. There is also the four-volume series titled Open Marxism. Open Marxism writers and theorists include John Holloway, Simon Clarke, Werner Bonefeld, Ana C Dinerstein, Richard Gunn, Kosmas Psychopedis, Adrian Wilding, Peter Burnham, Mike Rooke, Hans-Georg Backhaus, Helmut Reichelt, Johannes Agnoli, and Kostas Axelos. [39]
Neo-Marxism
In Political Ideologies: An Introduction by Andrew Heywood (4th edition from 2007) he describes neo-Marxism as: “an updated and revised form of Marxism that rejects determinism, the primacy of economics and the privileged status of the proletariat.” Heywood argues that neo-Marxism was shaped by two factors: a re-examination of conventional class analysis due to the collapse of capitalism not happening as Marx predicted, and a rejection of the Russian Bolshevik model of orthodox communism. [40]
In Sociological Theory, George Ritzer and Jeffrey Stepnisky describe the following schools of thought forms part of the neo-Marxist tradition: Economic determinism, Hegelian Marxism, Critical Theory, neo-Marxian economic sociology, historically oriented Marxism, neo-Marxian spatial analysis, post-Marxist theory (Ritzer 2011). They all take Marx’s work as the starting point by go in several different directions.
Economic determinism was a limited theory that led to other forms of neo-Marxism developing. Hegalian Marxism by the work of Antonio Gramsci and Georg Lukács that rejected economic determinism and focused on human subjectivity. Critical Theory is described above. Neo-Marxist economic sociology aims to update Marxist economic sociology based on contemporary capitalist society. It looks at the relationship between capital and labour, and the transition from Fordism to post-Fordism. Historically oriented Marxism relates to the work of Immanuel Wallerstein and his world systems theory. Neo-Marxist spatial analysis is based on the work of Henri Lefebvre, Edward Soja and David Harvey. Post-Marxist theory includes analytical Marxism and postmodern Marxian theory, see McLellan section above.
Others Marxisms
Political Marxism is focused on how capitalism came into being – the transition to capitalism. Also how to define capitalism: “nature of the system, the structural features that differentiate it from other modes of production, and its relationship to precapitalist (and potentially postcapitalist) social systems.”
Jonathan Joseph in Marxism and Social Theory describes Praxis Marxism, share a humanist perspective, value the importance of history, and are against the mechanical approach of orthodox Marxism. They focus on human subjectivity, class consciousness, class struggle and alienation. Joseph lists the praxis Marxists to be Gramsci, Lukacs, Korsch and Sartre. (Jonathan Joseph, Marxism and Social Theory p4 and CH4)
Two Marxisms
In 1980, Alvin Gouldner in The Two Marxism describes Scientific Marxism and Critical Marxism.
Michael Burawoy describes them:
“Scientific Marxism begins from a rational understanding of society that postulates the determinism of objective structures. It uncovers historical tendencies leading to socialism when conditions are ripe. Concepts reflect real mechanisms; politics are epiphenomenal; ideology is a distortion of the truth. Critical Marxism, on the other hand, starts out from the ubiquity of alienation obstructing the potential for human self- realization. It highlights human intervention against the obduracy of objective structures—history has no pre-ordained end, but is the product of collective mobilization. In the view of Critical Marxism, concepts exist to interpret social processes; politics is an arena for the realization of ultimate values; ideology is a moral force. In revolutionary times Critical Marxism and Scientific Marxism may form a contradictory unity, but in non-revolutionary times they more easily go their separate ways.” [41]
Endnotes
- Marxism After Marx, David McLellan, 2007, p9-14
- Marxism After Marx CH2
- https://en.wikipedia.org/wiki/Rosa_Luxemburg#The_Accumulation_of_Capital
- Marxism After Marx CH3
- Marxism After Marx CH4, https://en.wikipedia.org/wiki/Austromarxism
- Marxism After Marx CH5
- https://en.wikipedia.org/wiki/Leon_Trotsky
- Marxism After Marx CH6
- https://en.wikipedia.org/wiki/Vladimir_Lenin
- Marxism After Marx CH7
- Marxism After Marx CH8
- Marxism After Marx CH9
- Marxism After Marx CH10
- Marxism After Marx CH11
- Marxism After Marx CH12
- Marxism After Marx CH13
- Marxism After Marx CH14
- https://en.wikipedia.org/wiki/Antonio_Gramsci
- https://en.wikipedia.org/wiki/Chinese_Communist_Revolution
- Marxism After Marx CH15
- Marxism After Marx CH16
- Marxism After Marx CH17
- Marxism After Marx CH18, https://en.wikipedia.org/wiki/Underdevelopment#Dependency_theory, https://www.ppesydney.net/three-theories-of-underdevelopment/
- https://en.wikipedia.org/wiki/Critical_theory
- Marxism After Marx CH19
- Marxism After Marx CH20
- Marxism After Marx CH21
- Marxism After Marx CH22, CH5 Understanding Marxism Geoff Boucher https://tuxdoc.com/download/understanding-marxism-geoff-boucher_pdf#download-require
- Marxism After Marx CH23
- Marxism After Marx CH24
- Marxism After Marx CH25
- CH6 Marx and Marxism, Gregory Claeys, 2018, CH6
- Rosa Luxemburg and the Struggle for Democratic Renewal, Jon Nixon, 2018, page iix-ix
- http://libcom.org/library/gik-introduction
- https://en.wikipedia.org/wiki/Workerism, https://en.wikipedia.org/wiki/Autonomism, https://medium.com/@sethwheeler/tronti-and-the-many-faces-of-autonomy-a111cced7bdf)
- https://en.wikipedia.org/wiki/Autonomia_Operaia, https://en.wikipedia.org/wiki/Autonomism, https://medium.com/@sethwheeler/tronti-and-the-many-faces-of-autonomy-a111cced7bdf, Social Movements Key Concepts, Graeme Chesters and Ian Welsh, 2011, page 37)
- https://en.wikipedia.org/wiki/Autonomism#The_Marxist_Autonomist_theory
- https://en.wikipedia.org/wiki/Autonomism, https://culturepowerpolitics.org/2016/05/04/the-multitude-and-the-metropolis/, https://notesfrombelow.org/article/workers-inquiry-and-social-composition, Autonomy Capitalism, Class and Politics, David Eden, 2017, page 12-15
- https://marx.libcom.org/library/libertarian-marxist-tendency-map
- https://buildingarevolutionarymovement.org/2019/03/30/political-ideology-part-2/
- https://newleftreview.org/issues/II121/articles/michael-burawoy-a-tale-of-two-marxisms?pc=126
by DGR News Service | Aug 17, 2021 | Education, Movement Building & Support, Repression at Home, Strategy & Analysis, Worker Exploitation
This article is from the blog buildingarevolutionarymovement.
This post provides a brief introduction to the current form of capitalism: neoliberalism. It includes sections on: neoliberal ideology; Governmentality – how neoliberalism governs, neoliberal government policies; how neoliberalism is a capitalist class project of domination; the history of neoliberalism in the twentieth century; and the three phase of neoliberalism in government since the 1980s.
Neoliberalism is a form of capitalism and liberalism. Neoliberalism is the most aggressive form of liberalism ever formulated. Liberals generally assume that being a “self-interested, competitive entrepreneur is the natural state for human beings, neoliberals know that it isn’t.” But the neoliberals still want people to behave that way. They achieve this by using the state and corporate power to make us act in that way, regardless of what most people want. [1]
Neoliberal ideology
Ideology can be defined as a set of assumptions about how society does and should work, it structures both what we think and how we act. Our world has competing truths, values, and theories, ideologies aim to favour some values over others and to legitimise certain theories or sets of meanings. Ideologies provide intellectual maps of the social world that establish relationships between individuals and groups versus the larger structure of power. They therefore play an essential role in maintaining the current power structure as fair and natural, or in challenging it by highlighting its injustices and pointing out the benefits of alternative power structures. [2] An ideology is most effectively when it denies its own existence and can pass itself off as the normal state of things or ‘common sense’ [3]
Jeremy Gilbert describes how it is difficult to differentiate between capitalism and neoliberalism:
“because neoliberalism is the most fanatically pro-capitalist ideology ever, and because it has become the default ideology of almost all actual capitalists, and certainly of almost all pro-capitalist political parties..it is important to differentiate between capitalism and neoliberalism because they are not the same thing – they are not the same KIND of thing. Capitalism is an economic practice. Neoliberalism is a philosophy about how societies in which that practice prevails should be managed, and a programme which is at least nominally informed that philosophy, or looks like it is.” [4]
Neoliberal ideology can be summarised as “a single global marketplace to the public, they portray globalizing markets in a positive light as an indispensable tool for the realization of a better world. Such market visions of globalization pervade public opinion and political choices in many parts of the world. Indeed, neoliberal decision-makers function as expert designers of an attractive ideological container for their market-friendly political agenda. Their ideological claims are laced with references to global economic interdependence rooted in the principles of free-market capitalism: global trade and financial markets, worldwide flows of goods, services, and labour, transnational corporations, offshore financial centres, and so on.” [5]
George Monbiot describes the ideology of neoliberalism as:
“Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning. Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers. Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve. We internalise and reproduce its creeds. The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages – such as education, inheritance and class – that may have helped to secure it. The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.” [6]
Meritocracy is a key feature of neoliberal ideology. This promotes a “hierarchical and highly unequal set of social relations while claiming to offer individuals from all backgrounds an equal chance to compete for elite status.” [7] This is good propaganda for neoliberalism, but in fact social equality and social mobility have decreased since the 1970s. [8]
Mark Fisher describes the ‘capitalist realism’ of neoliberalism as: “that it is easier to imagine the end of the world than it is to imagine the end of capitalism…the widespread sense that not only is capitalism the only viable political and economic system, but also that it is now impossible even to imagine a coherent alternative to it.” [9]
Governmentality
A second dimension on neoliberalism is what the French philosopher Michel Foucault called ‘Governmentality’:
“certain modes of governance based on particular premises, logics, and power relations. A neoliberal governmentality is rooted in entrepreneurial values such as competitiveness, self-interest, and decentralization. It celebrates individual empowerment and the devolution of central state power to smaller localized units. Such a neoliberal mode of governance adopts the self-regulating free market as the model for proper government. Rather than operating along more traditional lines of pursuing the public good (rather than profits) by enhancing civil society and social justice, neoliberals call for the employment of governmental technologies that are taken from the world of business and commerce: mandatory development of ‘strategic plans’ and ‘risk-management’ schemes oriented toward the creation of ‘surpluses’; cost–benefit analyses and other efficiency calculations; the shrinking of political governance (so-called ‘best-practice governance’); the setting of quantitative targets; the close monitoring of outcomes; the creation of highly individualized, performance-based work plans; and the introduction of ‘rational choice’ models that internalize and thus normalize market-oriented behaviour. Neoliberal modes of governance encourage the transformation of bureaucratic mentalities into entrepreneurial identities where government workers see themselves no longer as public servants and guardians of a qualitatively defined ‘public good’ but as self-interested actors responsible to the market and contributing to the monetary success of slimmed-down state ‘enterprises’. In the early 1980s, a novel model of public administration known as ‘new public management’ took the world’s state bureaucracies by storm. Operationalizing the neoliberal mode of governance for public servants, it redefined citizens as ‘customers’ or ‘clients’ and encouraged administrators to cultivate an ‘entrepreneurial spirit’. If private enterprises must nurture innovation and enhance productivity in order to survive in the competitive marketplace, why shouldn’t government workers embrace neoliberal ideals to improve the public sector?” [10]
Cultural theorist Mark Fisher describes the ‘bureaucratic managerialism’ of neoliberalism. Bureaucracy has been decentralised so that we actively produce it ourselves through “continuing professional development, performance reviews, log books, not to mention the whole machine of the Research Excellence Framework (REF).” Workers are encouraged to be highly self critical, but are assured that there will not be any consequences from this self criticism. The demonising nature of having to self criticise, that will then be ignored. Assessments at work have changed from periodic to continuous: “Our status is never fully ratified; it is always up for review.” [11]
A set of government policies
Jeremy Gilbert describes the main aim of neoliberal government programmes as being the promotion of the interests of finance capital and the processes of financialisation above all other interests. [12] He lists neoliberalism’s policy agenda or ‘actually existing neoliberal’ as:
- privatising public services
- deregulating labour markets so workers have fewer rights and protections
- attacking labour unions
- cutting taxes on the rich
- reducing public spending and welfare entitlements
- forcing services in the public sector to behave, as much as possible, like competitive, profit-seeking business. [13]
Capitalist class project
Neoliberalism can be described as a project of the capitalist class to restore their own class power, following their loss of power through the middle of the twentieth century, during the Keynesian period of high public spending and a strong welfare state. There has also been a recomposition of the capitalist class, with finance capital now dominating over all other sectors. [14]
Neoliberalism can also be seen as a reaction by capitalist elites to the increase in democratic demands in the 1960s. This was followed by a crisis in the 1970s between the capitalists and labour movement. The neoliberal response to was to offer increased private consumption and easily accessible credit, which “re-asserted the supremacy of finance capital over both industrial capital and the rest of the population for the first time since the great crash of 1929”. [15]
At this point of crisis in the 1970s, the neoliberals had two ‘revolutionary goals’ to restore the profitability of capitalism. The first was to “re-organize capitalism on a universal, transnational scale and thus place global markets out of reach of the influence of national governments, making markets less subject to national-scale popular democratic demands and freeing corporations to exploit labor and the environment at will.” The second was to “apply global economics in a ‘race to the bottom’ competition between nations, creating ‘austerity societies’ of disempowered consumers at the expense of social groups and their ‘market-distorting’ demands. The formation of the World Trade Organization in 1995 capped-off this revolutionary process of transferring economic power from nations—which ostensibly could be controlled democratically—to the much-less accountable global level.” [16]
A key function of neoliberal ideology is to “secure consent and generate political inertia precisely by enabling the experience of precarity and individualised impotence to be experienced as normal and inevitable.” Only a small number of people support neoliberal policies, namely the core neoliberal elite. For everyone else, neoliberal ideology aims “to console us that the sense of insecurity, of perpetual competition and individual isolation produced by neoliberal government is natural, because ‘that’s what life is really like’.” [17] Most people do not support neoliberalism, but as long as there is no viable alternative that wins broad popular support, then this results in a general ‘disaffected consent’ with the current system. [18]
In neoliberalism, capitalists have worked out the sweet spot to stop any serious challenge to their dominance: “as long as feeding one’s children (still the principal preoccupation of most adult humans, as it has been throughout history and before) remains an achievable but difficult task, then energies are likely to be devoted to the accomplishment of that goal: energies which cannot then be channelled into political activity of any kind. Where this objective becomes unachievable, populations are likely to resort to desperate, perhaps revolutionary, measures. Where it becomes too easily realised – as it did for the generation which came to maturity in the post-war years of social-democratic ascendancy – then capitalism is also likely to find itself subject to challenge by constituencies no longer intimidated by the immediate threat of destitution. Much of the neoliberal programme can be understood in terms of the efficacy and precision with which it engineers precisely the outcome of an economy and a society within which feeding their children and keeping them out of relative poverty remains an achievable but highly demanding task for most actors: actively producing insecurity and ‘precarity’ across the working population, without allowing the level of widespread desperation to pass critical thresholds. [19]
The making of neoliberalism
George Monbiot provides a good summary of the history of neoliberalism:
“The term neoliberalism was coined at a meeting in Paris in 1938. Ludwig von Mises and Friedrich Hayek saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism. In 1944 Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations. They created a transatlantic network of academics, businessmen, journalists and activists. The movement’s rich backers funded a series of thinktanks which would refine and promote the ideology. They also financed academic positions and departments, particularly at the universities of Chicago and Virginia.
As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from forming gave way – among American apostles such as Milton Friedman – to the belief that monopoly power could be seen as a reward for efficiency. The neolibers stopped using the name for their ideology ‘neoliberalism’ in the 1950s.
In the post war period neoliberalism remained at the margins, despite its lavish funding. The postwar consensus was almost universal: John Maynard Keynes’s economic prescriptions were widely applied, full employment and the relief of poverty were common goals in the US and much of western Europe, top rates of tax were high, and governments sought social outcomes without embarrassment, developing new public services and safety nets. But in the 1970s, when Keynesian policies began to fall apart and economic crises struck on both sides of the Atlantic, neoliberal ideas began to enter the mainstream. As Friedman remarked, “when the time came that you had to change … there was an alternative ready there to be picked up”. With the help of sympathetic journalists and political advisers, elements of neoliberalism, especially its prescriptions for monetary policy, were adopted by Jimmy Carter’s administration in the US and Jim Callaghan’s government in Britain. After Margaret Thatcher and Ronald Reagan took power, the rest of the package soon followed: massive tax cuts for the rich, the crushing of trade unions, deregulation, privatisation, outsourcing and competition in public services. Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation, neoliberal policies were imposed – often without democratic consent – on much of the world.” [20]
Phases of neoliberalism
There are a number of different perspectives on the phases of neoliberalism. [21] I believe there have been three phases of neoliberalism in government:
- First-wave neoliberalism in the 1980s: Reaganomics and Thatcherism
The ‘New Right’ of Thatcher and Reagan in the US and UK implemented a basic neoliberal economic programme with a range of conservative social policies such as restoring traditional family values, increased military spending, a tough law and order agenda, and limiting multiculturalism. [22]
- Second-wave neoliberalism in the 1990s: Clinton’s and Blair’s Third Way
The Blair and Clinton governments in the 1990s took a more centrist approach, that included the majority of neoliberalism combined with socially progressive policies. The governments supported private-sector-led economic growth, combined with the government providing a consistent level of social services to citizens. They also promoted equality for gay people and supported women in the labour market. [22]
- The third phase of neoliberalism began with bailing out the banks following the 2008 financial crisis. This was followed by austerity – massive cuts to public services. Inequality has increased, life expectancy has declined or stagnated, living standards have dropped. All this has polarised politics with the election of authoritarian, right-wing, isolationist politicians.
Endnotes
- Twenty-First Century Socialism, Jeremy Gilbert, 2020, page 27-8
- https://buildingarevolutionarymovement.org/2019/02/25/political-ideology-part-1/
- What Kind of Thing is ‘Neoliberalism’? in New Formations, Jeremy Gilbert, 2013, page 12, https://www.lwbooks.co.uk/new-formations/80-81/what-kind-thing-neoliberalism
- https://jeremygilbertwriting.wordpress.com/2015/07/14/neoliberalism-and-capitalism-whats-the-difference/
- Neoliberalism: A Very Short Introduction, Manfred B. Steger, 2010, page 11-12
- https://www.theguardian.com/books/2016/apr/15/neoliberalism-ideology-problem-george-monbiot
- What Kind of Thing is ‘Neoliberalism’? Page 15. Also see Meritocracy as Plutocracy: the Marketising of Equality under Neoliberalism, Jo Littler, 2013 https://www.lwbooks.co.uk/new-formations/80-81/meritocracy-plutocracy-marketising-equality-under-neoliberalism. And Against Meritocracy, Jo Littler, 2017
- What Kind of Thing is ‘Neoliberalism’? Page 22
- Capitalist Realism: Is There No Alternative Mark Fisher, 2009, page 2 and a summary https://videomole.tv/events/mark-fisher-capitalist-realism-part-2/. Also see Capitalist Realism, Neoliberal Hegemony: A Dialogue, in New Formations, Mark Fisher and Jeremy Gilbert, 2013, https://www.lwbooks.co.uk/new-formations/80-81/capitalist-realism-neoliberal-hegemony-dialogue
- Neoliberalism: A Very Short Introduction, page 12-14
- Capitalist Realism, Neoliberal Hegemony: A Dialogue, in New Formations page 91
- What Kind of Thing is ‘Neoliberalism’? Page 17
- Twenty-First Century Socialism page 28-9. Also see A Brief History of Neoliberalism, David Harvey, 2007
- What Kind of Thing is ‘Neoliberalism’? Page 16. Also see A Brief History of Neoliberalism
- Neoliberal Europe section of http://nearfuturesonline.org/corbynism-and-its-futures/#en-70-10
- https://www.opendemocracy.net/en/transformation/revolution-that-will-not-die/
- What Kind of Thing is ‘Neoliberalism’? Page 15
- What Kind of Thing is ‘Neoliberalism’? Page 18-19
- What Kind of Thing is ‘Neoliberalism’? Page 14. Also 28 minutes into https://culturepowerpolitics.org/2016/06/08/how-did-we-get-here-radical-histories-of-the-uk-1974-88/
- https://www.theguardian.com/books/2016/apr/15/neoliberalism-ideology-problem-george-monbiot
- https://culturepowerpolitics.org/2015/05/20/session-one-neoliberal-common-sense/; https://medium.com/@efblake/the-corporatocracy-and-three-waves-of-neo-liberalism-e0eb2f5afc6b; A Brief History of Neoliberalism, Neoliberalism; A Very Short Introduction chapters 2 and 3; The Handbook of Neoliberalism, Simon Springer , Kean Birch , et al., 2016; https://newleftreview.org/issues/II101/articles/william-davies-the-new-neoliberalism; Neoliberalism in Context: Governance, Subjectivity and Knowledge, Simon Dawes (Editor), Marc Lenormand (Editor), 2020; Third-Wave Neoliberalism in Theory and Practice: A Case Study of the Halifax Centre Plan, Sandy Mackay, 2016, http://theoryandpractice.planning.dal.ca/_pdf/multiple_plans/smackay_2016.pdf
- https://culturepowerpolitics.org/2015/05/20/session-one-neoliberal-common-sense/
