that you have the right to lord it over others because you are cleverer – or, more likely, better positioned due to the accident of birth – is another source of discontent with capitalism. Thoughtful people simply have the stubborn belief that we can do better than this. They have an underlying belief in the fellowship and solidarity of women and men and their capacity to co-operate with each other for the common good. Whether it is drawn from religious belief or secular conviction, or the experience of something better in their communities, families or memories, they just can’t seem to get in sync with the rightwing US writer Ayn Rand’s idea of selfishness as a virtue. They quickly come to realize that the opportunistic freedom of the derivative trader, real-estate speculator or arms dealer results in bankruptcies, evictions and corpses.
The second line of argument buttressing the case for capitalism as freedom of opportunity is that ‘a rising tide lifts all boats’. This holds that the success of a few leads to the prosperity of the many through the creation of jobs and the famous ‘trickle down’ of wealth. You need look no further than the present state of the world, where inequality and the concentration of wealth are increasing virtually everywhere, to wonder at the sheer gall of those who hold this view. Around 0.1% of the world’s population currently hold 50% of world income8 and 51 of the world’s 100 largest economies are now corporations.9 In the meantime, rates of unemployment (particularly youth unemployment) are continuing to rise, imperiling the future of a generation.
All the same, opponents of capitalism have no right to be smug. The system has proved it has staying power. It has won at least the passive adherence of hundreds of millions of people who really have no significant stake in it. It has convinced them that there is no alternative but to play by the rules of capital’s game. It has used crisis after crisis as a way of reinventing itself and opening up new avenues of profit. It has diverted scientific and technological progress to serve its own narrow ends. It has shown a flashy dynamism that still draws in the greedy and the gullible. It has undermined the alternatives that have been set up to oppose it, either through guile or force. It has appealed to what is worst in our natures, blinding us with celebrity and consumption (or at least dreams of future consumption). It has proved itself a worthy opponent and it is far from clear that capital can ever be brought to serve the purposes of humanity rather than the other way around.
For in the end it is not capitalists that control capital. They encourage it. Benefit from it. Obey it – or not, at their peril. But the history of business is dotted with ways in which capital has turned on them, driving them into bankruptcy, crisis, war or some other disaster. Many captains of industry and finance dwell under the illusion of their mastery of capital but it remains just that: an illusion. They have made a Faustian pact or devil’s bargain and given capital its freedom to roam wherever it wishes, regardless of consequence. This is perhaps the most profound danger of capital on the loose in the current age: in its increasingly desperate quest for profit, capital is driving us over the ecological edge, endangering the very possibility of sustainable human life on the planet.
1 Daniel Cohn-Bendit, ‘Enough with the European leaps of faith’, opendemocracy. net 21 Mar 2013.
2 Jeff Madrick, ‘US financial regulations; Plugging holes in a faulty dam’, triplecrisis.com
3 Bob McGuire, ‘Widening labour and peasant revolts threaten Chinese rulers’, newsandletters.org Jan/Feb 2012.
4 Eli Friedman, ‘China in Revolt’, Jacobin, nin.tl/1fZpIyj
7 Wendy Brown, ‘Neo-liberalism and the end of liberal Democracy’, Theory and Event, 7.1, 2003.
8 Capgemini and Merrill Lynch Wealth Management, 2009.
9 corporations.org/system/top100.html
In practice, most alternatives to capitalism are seen as some form of socialism, which now has a checkered history stretching back over two centuries. The early stirrings of socialist thought eventually crystallized into two main forms: communism and social democracy, both of which are flawed and seem to have largely capitulated to the forces they once resisted.
‘If you took the most ardent revolutionary, vested him with absolute power, within a year he would be worse than the Tsar himself.’
Mikhail Bakunin
Socialism organized through the state has been the main way in which humanity has tried to build an alternative to capitalism. We now have a couple of centuries of experience of this so it should be possible to build a balance sheet of positives and negatives. From the beginning, the state – or, if not the actually existing state, some idealized version of its socialist reformation – has been for most socialists a source of coherence and justice in opposition to the squalor and instability of the capitalist market. This view has drawn sustenance from the thinking of a wide variety of 18th- and 19th-century political philosophers, including Rousseau’s notion of the ‘general will’ and Hegel’s idea of the state as the high point of human rationality. The Left’s allegiance to the state has been further reinforced by the unity of the state with the nation (the idea of the nation-state), which has allowed it the political luxury of dressing in the same patriotic clothes as the Right. While there have been competing currents of leftist opinion, it is this notion of a rational state as opposed to an irrational market that has until recently carried the day. This is the background needed for any understanding of what has been a largely uncritical view of the potential of the state to install and oversee a socialist alternative. The legitimacy of the political state and the way it exercises power remains one of the Left’s major intellectual blind spots.
From its very beginnings there has always been a strain of socialism that has had about it an élitist and technocratic cast. This derives from its birth as a blueprint for reform issuing from the minds of social reformers such as the German activist and philosopher Ferdinand Lassalle and the French aristocrat Saint-Simon. Much of their politics was based on gaining access to the ear of those in power to convince them to implement schemes of social reform. Lassalle is credited with a certain amount of influence on Otto von Bismarck, one of Germany’s most famous (and autocratic) chancellors, who laid down the beginnings of that country’s welfare state. Other early socialist reformers, including the British factory manager Robert Owen, combined influence for progressive legislation with the establishment of utopian communities. Most such endeavors have had a slightly condescending attitude to the moral reform of wayward working-class personalities.
Another source of the original socialist impulse was popular movements of workers, particularly more educated craft workers but others as well, who saw economic democracy as an extension of radical republican goals. This tendency reached its first moment of decision at the time of the French Revolution, when there was a tension between a spontaneous revolutionary movement with radical egalitarian politics and its crystallization into a centralized political party in the shape of the Jacobins. It was the Jacobins who installed a dictatorship in Paris, supposedly to preserve and extend the revolution. They faced (or at least
