My Beef with Capitalism, in a Nutshell

Posted: December 3rd, 2011 by Militant Libertarian

by George Donnelly

‘Capitalism’ is a funny word. It means so many different things to so many different people, that it’s become entirely useless as a basis for any kind of rational or constructive communication. For some, it is a vessel to romanticize and to pour all their dreams into. For others, it is a trashcan they fill with their complaints and most cynical expectations for the future. But what is capitalism, at its root?

Some will mention wage labor, others exploitation and yet others will talk of free trade. But I think the defining feature is the ability to accumulate lots and lots and lots of stuff(capital). And then, most importantly, to have a third party protect your ability to control that stuff even when you’re not using it. That third party, of course, is the state (the government).

(Does it have to be a state? No. But I don’t think a non-aggressive organization will go to the same lengths as the state to protect property.)

Without this ability to accumulate and have your title to said stuff protected at little to no cost to yourself, things like wage labor, exploitation and managed trade could not happen. These all depend on the power imbalances that stem from the state protecting capitalists’ control of their property.

I don’t think capitalism would survive without the state. In a stateless society, people would be freer to rise up against people who attempt to control more property than they actually use. Acting in concert, great numbers of people could, in the worst case, purchase arms, form a defense force and fight capitalists on a more level playing field. Squatters, worker-owned cooperatives and similar direct actors would take control of more of the capitalists’ property. In the process, their power would be eaten away.

To those who say that capitalism is free trade, nothing more and nothing less, that is not its defining characteristic. Free trade can happen under many different ideological systems. Free trade is blooming right now in China in the midst of an ostensibly socialist system. Free trade can happen in an anarchist society. I don’t doubt that free trade even happened in the Soviet Union, where some may have bartered vodka for bread (or the opposite), for example.

Neither is exploitation a defining characteristic of capitalism, since it can happen anywhere there is an imbalance of power, including under socialist, communist, democratic or plain old totalitarian regimes. In other words, exploitation is not unique to capitalism.

So that’s my problem with capitalism: that some privileged people get to accumulate tons of stuff at other’s expense by using the government to shield them from market action. By market action, I mean homesteading of property the capitalists aren’t themselves using.

So, I’m not high on capitalism (anymore). What am I into? I like the idea that people’spossessions should be respected. These are the things an individual uses on a regular basis to live his life. I would include all the tools and toys a person uses in their home and business, including a reasonable amount of land to live on, to use for recreation and producing food; and everything that goes with their business.

If a person prospers legitimately, I have no basis to challenge any accumulation of wealth. But I take issue with absentee control of things, especially natural resources. There is an argument that the earth is the common heritage of all people. I find this convincing. So for one person to deny others the reasonable use of this common heritage is not legitimate.

For example, if someone fences off 1,000 acres of land but consistently uses only 2, I don’t consider that legitimate. Simply being first to fence is not a solid foundation for denying this common heritage to others. If someone needed land and had a solid intention to use it to sustain his life, I would support that person in any attempt to homestead a reasonable parcel out of the 1,000 acres.

A capitalist might argue that the the first-fencer mixed his labor with the land or registered title and so it was now “a part of him” (which sounds a little too mystical for my tastes). But the first-fencer only mixed his labor with the 2 acres he is using and the thin strip of land the fence is on. What about the other ~998 acres? He hasn’t done anything there. So I don’t even think the homesteading principle supports the first-fencer’s actions.

But you can’t live life without property, say the capitalists. Yes, you can. You can live life with possessions, the things you control and use. You absolutely can live life without those things that you don’t use but control (property). If you don’t use them, that right there shows that you do not need them in order to live.

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  1. […] don’t think Capitalism would survive without the state. In a stateless society, people would be freer to rise up against […]

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