Source: Jacobin (https://www.jacobinmag.com/2018/11/introducing-the-abcs-of-capitalism)
So, one day, I set out to buy Jacobin’s little book, The ABCs of Socialism. Somewhere along the way, I screwed up and ordered The ABCs of Capitalism instead. That’s OK. No harm done. I read The ABCs of Capitalism, and here are my thoughts on it.
Overview of The ABCs of Capitalism
The ABCs of Capitalism is a series of three short pamphlets put out by the Jacobin Foundation. It released them under its journal Catalyst, and they’re written by its founder, Vivek Chibber.
The goal is to provide a brief, digestible overview of the capitalist system to people newly interested in socialism. Largely as a result of the Bernie Sanders 2016 campaign, the Democratic Socialists of America has had an explosive membership growth. And lots of other people are also interested in socialism for the first time. They need some kind of way to make sense of the system we live in and fight against.
Hence, the pamphlets. But are they any good? Has Chibber done a good job?
Understanding Capitalism
The point of the first pamphlet is to give an overview of the role of capitalism in society. Chibber points to the vast increases in inequality in the era of finance capitalism. And to the recent surge in popular interest in socialist and social democratic candidates in Western Europe and the US. This includes candidates such as Jean-Luc Mélenchon in France, Jeremy Corbyn in the UK, and Bernie Sanders in the US.
Identifying Capitalism
Chibber doesn’t so much define capitalism as give various criteria for identifying it. He characterizes capitalism as the system in which people must use the market to earn a living.
Specifically, people must, in most cases, work for someone else. And society provides basic necessities via the market system rather than public institutions. This system requires, among other things, the private ownership of economic resources, wage-labor, and the production of basic goods for sale on the market.
I don’t want to make too big an issue of this at the outset, but it’s worth asking about the flexibility of Chibber’s characterization. Imagine a future world where most of us work as freelancers of one kind or another. We do piece-work, rent out our house or possessions, or otherwise use our own tools to do work as a kind of precariat. As Guy Standing argued. In this kind of scenario, many of us do own some or all of the means of production, and what we’re doing isn’t quite wage-labor. At least not exactly.
Such a scenario doesn’t sound much like Chibber’s story about capitalism. But it’s still a capitalist system. Thus, we may need broader or more flexible criteria for identification.
A second issue is that Chibber might set the bar for ‘socialism’ a bit low. Assume a world where we take basic necessities (e.g., housing, food, and water) out of the market and provide it publicly. Almost all socialists support this. But is this, by itself, sufficient for calling our world a ‘socialist one’? Even if we still have a capitalist marketplace for everything else? I think the answer is “no.”
Profit and Surplus-Value
Chibber references Volume 1 of Marx’s Capital in explaining the basic operations of the capitalist system. And that’s the right move. Marx is still the best on this, and I’ve provided some suggestions for how to approach Marx.
Chibber reads Marx as claiming that the capitalist system revolves around profit. The capitalist buys tools, resources, and labor-power to produce goods. And the capitalist’s goal is to sell those goods at a higher price than that paid for the tools, resources, and labor-power. Hence, profit.
As far as it goes, this is perfectly fine. But I think any explanation of Marx’s Capital has to start from surplus-value. Chibber presents these issues in large part as moral issues, as the capitalist getting away with a swindle of squeezing more money out of products than that to which they’re entitled.
But the basic operations of capitalism, for Marx, isn’t a moral issue. What Marx shows in Volume 1 of Capital is that, through a series of apparently ‘fair’ economic transactions, the capitalist comes away with surplus-value and, hence, profits. Here’s how it works. The capitalist pays the worker the actual value of their labor-power. This value is the worker’s means of subsistence, which depends on social norms and practices. And then the capitalist extracts from that labor-power an amount of value that’s greater than the value of the labor-power that went into it. Each step appears to all parties to be ‘fair.’ And everyone gets paid equal to the value involved. But, at the end of the process, the capitalist walks away with a swindle.
That apparent fairness is the key misconception we have to help people overcome.
Productivity
The nature of the capitalist system, especially competition, requires an endless push for productivity. This means more goods at the same costs, or the same goods at lower costs. Chibber also references the famous graphic showing that workers aren’t benefiting from this, which I discussed earlier.
Chibber explains, effectively in my opinion, that this state of affairs is the result of power imbalances in the workplace. And that the decline of unions is central to this imbalance. Thus, there’s a need for a renewed labor movement.
Capitalism and the State
The second pamphlet sets out to evaluate the usefulness of the state as an avenue for pro-labor class struggle. As a basic point of departure, Chibber references classical pluralist theory. Pluralism, on his interpretation, is the view that lots of groups compete over contrary interests in front of a neutral state. But he charges that the state doesn’t really begin from a position of neutrality, but rather one of anti-worker bias. The ‘B’ in The ABCs of Capitalism is thus a set of problems with the capitalist state.
The State’s Bias
Chibber sets out three types of pro-wealthy bias. One, wealthy people are more likely to hold office due to the high costs involved. Two, wealthy people are better able to influence politics due to their money and access. Three, and most importantly for Chibber, the state depends on capital and the capitalist system to reproduce itself. The state uses taxation and economic growth to sustain itself. This provides corporate power with various levers to influence the state, with capital flight the most noteworthy.
This last point impacts strategies and tactics for the left. Capital flight has been a popular tool of, among other examples, opponents of Hugo Chávez and Nicolás Maduro in Venezuela. And we should think about policy proposals in light of this threat. In the US, Elizabeth Warren has proposed a wealth tax, and Alexandria Ocasio-Cortez and Bernie Sanders, among others, have proposed increased income and estate taxes on the wealthy.
For proposals like this to work, they need to be supported by a deeper popular movement that forces capitalists to accept them. They can’t simply increase the state’s dependence on the capitalist system.
The Basic Strategy
That brings us to Chibber’s points on strategy. What he calls for is a united labor party and labor movement. A labor party without a supporting labor movement tends to drift off toward upper middle income interests, which tend to diverge from working-class interests. And a labor movement without a labor party is limited in what it can accomplish politically, or so Chibber claims.
I think this is on the right track, though I’d point out that there are some limitations on what workers can achieve qua workers, without a broader movement. I don’t mean we should include capitalists in the movement. Rather, there’s room to include people dispossessed for reasons other than their status as workers. I’ll say more about that below.
Capitalism and Class Struggle
The third and final pamphlet is on the role of class struggle in fighting capitalism. Chibber explains the left as the unity between a moral stance against capitalism’s violations of worker autonomy and control of free time, on the one hand, and a labor-based political class struggle, on the other. I’ve raised some trouble for the ‘moral’ end of this above. But the labor side of things has some issues as well.
The Composition of the Working-Class
And here’s where I think there’s potential trouble. I’ve written before about how people mistakenly believe that Trump’s base is working-class. In an analogous way, I think Chibber might overestimate the size of the working-class.
Chibber’s basic line of argument is that the working-class forms a majority. It lacks autonomy and it’s in a structural relationship with capital that results in wage suppression and labor extraction, among other issues. Furthermore, the capitalist system puts workers, and only workers, into direct conflict with the powerful on a daily basis. And it puts workers into a collaborative position where they can work together. Hence, on Chibber’s reasoning, only the working-class can lead an anti-capitalist movement.
A Broader Coalition
I see two problems with Chibber’s reasoning on this point. One, it’s not clear whether the ‘working-class’ forms an actual majority. At least in the US. It really depend on how you’re defining ‘working-class.’ Does it include retired people? Unemployed people? How about freelancers or workers who may own the means of production, even if they’re seriously exploited? Does it include people who work for companies, but earn high salaries, such as scientists or engineers? I cataloged similar issues with Noam Chomsky’s views in the Chomsky-Foucault Debate.
If those people aren’t included, the working-class is well under half the population. But if they are, then quite a few ‘workers’ have as much or more in common with capitalists as they do with their fellow workers. Many higher income workers, for example, are staunchly pro-capitalist in their politics and overall outlook.
Two, Chibber comes off as quite dismissive toward workers who are exploited by the capitalist system through mechanisms other than profit via a job. He lists homeless people, the disabled, black people qua race, women qua gender, et al., as people whose oppression the left should attend to, but who shouldn’t be leading the movement.
That’s a mistake. Many people on his list are targets of the capitalist system via accumulation by dispossession. The landlord extracts profits from tenants, and many unemployed people form a key part of the reserve army. Race scholars and feminist scholars have written hundreds of books and articles about how capitalists extract profits from people, or reduce the value of labor-power, via the use of race and gender. This is all extraction of value for profit. But it’s not necessarily through working. At least not directly.
A good movement is one that combines the power of the working-class with other targets of capitalism.
Identity Politics
Chibber draws a working distinction between issues like microaggressions, language, symbolic affronts, etc., on the one hand, and deep and structural issues involving identity, on the other. He asserts that identity politics movements, and social justice movements more broadly, will never be successful without centering class-based concerns. They simply must address capital if they’re to achieve their goals.
On these issues, I think Chibber is mostly wrong. And this is a key weak point of The ABCs of Capitalism. For one, I’m not convinced that some of these movements need to confront capital to achieve their goals. It depends on the goals of the movement. The point applies to leftist identity politics and social justice movements. But some liberal social justice movements aren’t leftist. Those movements are working hard to create an anti-racist and anti-sexist form of capitalism, as I’ve pointed out before. All they have to do is get the capitalist system to eliminate racial and gender bias. They can do this with tools like automation, which could generate a reserve army of labor without resorting to racism or sexism. These tools wouldn’t eliminate the subordination of black people or women, but they would end their subordination qua race or gender.
But, second, I think he fails to state something I’ve written about many times on this blog. Namely, the fact that the need is, in some ways, the other way around. Class struggle needs to be able to address issues of identity. And the reason isn’t just to recruit new members. It’s because categories of identity form a big part of the way the capitalist system exploits people, extracts profits, and sows division and discord.
Lessons From The ABCs of Capitalism
What I was thinking as I finished The ABCs of Capitalism is: what might a slightly improved overview of capitalism look like? Here’s my attempt at laying out a few key features:
- Capitalism operates by generating surplus-value, and thereby profits, through a series of economic transactions that carry the appearance, but not the reality, of fairness in the form of equal exchanges of value.
- Capitalism changes its dominant form throughout eras. It adapts to new developments, shores up weaknesses in some areas by appealing to others, etc. In our current era, financialization is the dominant form of capitalism.
- Our current era is susceptible to asset bubbles and other complications of fictitious capital. Movements must combine resistance to finance-based accumulation with targeted resistance at specific points of the circulation of capital, e.g., at various points of the global supply chain.
- It’s not enough to use ‘workers’ or the ‘working-class’ as the center point of anti-capitalist movements. We must also include those hit hard by accumulation by dispossession. This includes tenants, unemployed and underemployed workers, and those targeted by racial-, gender-, and sexuality-based oppression in the economic sphere.
