Disassembly Required. Geoff Mann
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“why” are two different questions. The first is a descriptive problem; the second is analytical, and at least partly historical. Ultimately, it is the analytical part that matters politically, because it requires an argument: these are the reasons why capitalism operates the way it does; it is these dynamics that inevitably fail to meet the needs of many; and these are the reasons there are better, fully realizable ways of organizing our lives. The emphasis throughout is on this analytical side; but we can only get there after getting the descriptive side down as well as possible. We need empirical material to work with, an understanding of the nuts and bolts of capitalist dynamics that is not exhaustive, but nonetheless fairly detailed and subtle.
If Capitalism Is Something, What Kind of Thing Is It?
The first thing we need to agree upon is that capitalism is something we can name, with distinctive features that distinguish it in non-trivial ways both from what came before and from other contemporary systems of economic organization. Capitalism is one way of arranging human society, of organizing the social relations of production, exchange, consumption, and distribution. We can call this arrangement, as Karl Marx did, a “mode of production,” but could just as easily call it a “mode of organizing economic activity,” or even simply an “economic system.”
All three terms, one might say, get the point across. However, some precision is useful here. First, in today’s capitalist societies, “the economy” and things “economic” are depoliticized and oversimplified. For many, the “economic system” refers to specific dynamics associated with production and exchange in formal (i.e., legally recognized) markets. Rarely does it bring to mind things like women’s work in the home, the illicit drug trade, or the education system, even though these are significant components of modern capitalism. To understand modern political economic arrangements, we need language that reminds us explicitly of what they involve, and “the economy” or “economic system” do not do that work right now.
The second reason we need specific terminology is the popular association of modern capitalism with “human nature.” It is fair to say that many people believe that the capitalist “economic system” is the logical outcome of “natural” human motivations and proclivities. Capitalism is taken not as an economic system, but as the economic system. Economic questions are taken to be synonymous with questions about capitalism. Indeed, capitalist political economy has become so dominant in our way of thinking that any economic relationship that is not capitalist is assumed to be somehow “distorted” or “fettered” by the state or some other institution. The assumption is that if an economy is not capitalist, it is either backward or underdeveloped (and thus not capitalist yet), or it is being purposely prevented from being capitalist, and would immediately “go capitalist” if left to its own. There is no historical evidence this is even close to true. Markets and states and human communities “go capitalist” when organized to do so.
For these reasons, I think “mode of production” is preferable. It flags the fact that an economic system is always a way of organizing social relations. Capitalism, communism, socialism, and any other mode of production you can think of are all ways of organizing the production and reproduction of the system itself. They produce and maintain the ways we live. Thinking of capitalism as a mode of production thus allows us to include in the “economic” conversation the gendered division of labour in the household, which produces particular kinds of workers in capitalism. It allows us to recognize that the way we interact with and shape ecological systems is a key part of how we produce and reproduce our societies. It lets us look at the educational system as, in large part, a training in “economic participation.” The mode of production concept flags the fact that capitalism is not defined by factories and financial firms—there are both in non-capitalist societies—but by the societal norms and institutions in which they operate.
The point is that even though we often think of “economic” things as outside or different from social things, they are not. Producing, consuming, exchanging and distributing only happen because people do them—and they do them the way they do for lots of reasons that are not, in themselves, “economic.” Producing, consuming, working, and exchanging are social in the “actually existing” sense. The people doing all this are not abstract “agents.” They are real living people, vital individuals with likes and dislikes and hopes and fears. They are also members of more or less well-defined social groups and societies based in real times and places. They may be from different groups, societies, or places, of course, but no one is from nowhere. And that means that every person and group involved in economic activity participates (at least in some way) according to the norms, customs, and ideologically embedded practices in which they are immersed.1
More importantly, calling capitalism a “mode of production” highlights the fact that there are other, different ways of organizing the social relations of economic life. Feudalism, which preceded capitalism in much of Europe, was one in which economic activity was organized by coercive lord-vassal relations of tribute and protection (and varied widely in the places and times historians call “feudal”). Another mode of production existed as the authoritarian “state socialism” of the former Soviet Union, a mode that most people erroneously call “communism” (largely because those systems misidentified themselves, of course; few would willingly call themselves “authoritarian state socialists”).2
What Makes Capitalism Capitalist?
Capitalism emerged in Europe from so-called “precapitalist” modes of production (principally feudal and mercantilist) over a period of centuries. There are longstanding debates regarding precisely when, where, and why it emerged, how long it took, and who was involved, but there is a general consensus that by the late eighteenth and early nineteenth centuries, what we now call capitalism was fairly well consolidated in England, and to a lesser extent in western Europe. Capitalism has since diffused, unevenly and incompletely, across the globe. Often it has done so through coercive means, including war and colonialism. In other places and times, it has spread in a less violent manner, either by simply providing people with what they wanted, or because it was embraced by those who believed it was the key to “development.” Consequently, capitalism does not look the same everywhere you go. Societies with other modes of production have inevitably adapted to capitalism, and adapted capitalism to fit. China, for example, has developed a very complicated relationship with capitalism over time, a relationship that continues to evolve.
Identifying the essential characteristics of capitalism is not a simple task. Many of the features of modern economies that appear to be distinctively capitalist—private exchange markets, for example—are necessary features of capitalism, but are not found solely in capitalist conditions. Others, like “fiat” money (money whose value is not based on an underlying commodity like gold), are products of capitalist development, but were also commonly taken up in noncapitalist systems like Maoist China and the post-Revolutionary Soviet Union. Thus, the range of features that define capitalism as capitalism is up for discussion, but I think Geoffrey Ingham has most effectively conceptualized the essentials as: (1) private enterprise for producing commodities, (2) market exchange, (3) a monetary system based on the production of bank-credit money, and (4) a distinctive role for the state in relation to these features.3
(1) Private Enterprise for Producing Commodities
In capitalism, commodities in virtually all forms (although not all, as we will see with the state) are produced by private enterprises that are institutionally, legally, and often socially separated from the household and the state.4 These private enterprises organize production around employing labour to work on capital to produce profit. Those who operate the enterprise often do not own the physical means or the money used by the enterprise. The way profit is produced, and the nature of the relationship between the worker and the capitalist (and the management, who are often not either) is the subject of long and heated debate, as we will see in Chapter 2.
(2) Market Exchange
The