Why capitalism is inherently immoral

Think of it as an example of the problems of an exploitative, extractive system of social organization, perhaps as a culmination of that system:

We cannot know if the cotton industry was the only possible way into the modern industrial world, but we do know that it was the path to global capitalism. We do not know if Europe and North America could have grown rich without slavery, but we do know that industrial capitalism and the Great Divergence in fact emerged from the violent caldron of slavery, colonialism, and the expropriation of land. In the first 300 years of the expansion of capitalism, particularly the moment after 1780 when it entered into its decisive industrial phase, it was not the small farmers of the rough New England countryside who established the United States’ economic position. It was the backbreaking labor of unremunerated American slaves in places like South Carolina, Mississippi, and Alabama.

When we marshal big arguments about the West’s superior economic performance, and build these arguments upon an account of the West’s allegedly superior institutions like private-property rights, lean government, and the rule of law, we need to remember that the world Westerners forged was equally characterized by exactly the opposite: vast confiscation of land and labor, huge state intervention in the form of colonialism, and the rule of violence and coercion. And we also need to qualify the fairy tale we like to tell about capitalism and free labor. Global capitalism is characterized by a whole variety of labor regimes, one of which, a crucial one, was slavery.[1]

This passage is buried in the middle of a Chronicle Review article by Sven Beckert which traces the relationship between slavery and capitalism. This is about the only place he mentions the expropriation of indigenous lands, but he does mention it and his historical treatment of capitalism’s origins is useful.

I have long argued that the capitalist emphasis on reduced labor costs, euphemized as “efficiency,” in fact culminates in slavery. Why, after all, should a capitalist pay for labor when s/he can get it for free? That is the logical extension of John Steele Gordon’s defense of Wal-Mart and Starbucks in the neoconservative journal Commentary:

I doubt that Timothy Egan [the author of an op-ed in the New York Times] has ever gone into a store to buy something and, on being told the price, insisted on paying more. So if Walmart can hire a satisfactory employee at a given wage, why should it insist on paying more? For one thing, it would violate its fiduciary duty to the stockholders. For another, it would have to raise the prices its hundreds of millions of customers pay.[2]

There is, in this argument, no duty to workers, only to consumers whose prices should not be raised, but even more importantly, to stockholders—that “fiduciary duty” thing. Max Weber noted over ninety years ago that it was “elemental” that any market system of economics would exacerbate inequality by privileging whomever has the greater power to say no. He also noted that these privileges of the better off and disabilities of the not so well off would be cumulative.[3] In writing of “fiduciary duty,” Gordon also does not note the vast wealth of the Walton family that has largely been extracted from poorly paid Wal-Mart workers. It is this power discrepancy, exemplified at Wal-Mart, rather than any illusion of a level playing field between producers and consumers, and between capitalists and workers that characterizes economics in the real world.

Beckert is not the first to notice “the all-too-frequent failings of economists, who have tended to naturalize particular economic arrangements by defining the ‘laws’ of their development with mathematical precision and preferring short-term over long-term perspectives.”[4] Indeed, this naturalization of “particular economic arrangements” is a key feature of capitalist libertarian neoliberal ideology, which in turn has been elevated to the status of a moral system by neoconservatives.

We see this ideology as morality system again in Ayn Rand’s depiction of workers as dependent on “creators,”[5] “job creators” in more recent rhetoric. In this picture, workers should be grateful for every penny they get, which is another way of saying that work is their duty, but that they should be paid, let alone a “living wage,” is not.

Thus morality is, in this ideology, reduced to protection of the rich and powerful. Just like law, passed by wealthy (mostly) white (mostly) males against everyone else.

Whether one adopts the morality of an “unseen enforcer” or the ethics of members of a sentient species seeking to live with each other,[6] this neoconservative, neoliberal, capitalist libertarian ideology values the strong over the weak. And unless the weak understand that they are to sacrifice further to comfort the strong, just as in any colonial arrangement, this seems likely to exacerbate conflict rather than reduce it.

Slavery did not die because it was unproductive or unprofitable, as some earlier historians have argued. Slavery was not some feudal remnant on the way to extinction. It died because of violent struggle, because enslaved workers continually challenged the people who held them in bondage—nowhere more successfully than in the 1790s in the French colony of Saint-Domingue (now Haiti, site of the first free nation of color in the New World), and because a courageous group of abolitionists struggled against some of the dominant economic interests of their time.[7]

And that, ultimately, is why neoliberals are so opposed to labor unions, why they view corporate monopolies as benign and as deserving of deregulation, while they see labor unions as deserving of the full weight of anti-trust regulation.[8] It was organized (slave) labor that overthrew slavery in Haiti and which challenges it elsewhere. Opposition to labor unions is an admission that slavery is the preferred employer-employee relationship.

The question then moves to whether it could be possible for capitalism to have developed in any other way. For this, we need only move to the problem that an exchange system of economics aims to solve. Drawing on the mythology of original sin, it assumes that, given the opportunity, humans will not work, will not contribute “their fair share” to society, and therefore, that they must be coerced into doing so. In other words, “free labor” is a euphemism for slavery that ignores the millions of years in which human beings lived together, hunted together, gathered together, and cooperated with each other prior to the Neolithic.[9] And the “morality” of capitalism depends upon the illusion—a falsehood—that those millions of years did not exist.

  1. [1]Sven Beckert, “Slavery and Capitalism,” Chronicle of Higher Education, December 12, 2014, http://chronicle.com/article/SlaveryCapitalism/150787/
  2. [2]John Steele Gordon, “Walmart, Wages, and the Public Good,” Commentary, June 24, 2014, http://www.commentarymagazine.com/2014/06/24/walmart-wages-and-the-public-good/
  3. [3]Max Weber, “Class, Status, Party,” in Social Theory: The Multicultural and Classic Readings, ed. Charles Lemert, 4th ed. (Boulder, CO: Westview, 2010), 119-129.
  4. [4]Sven Beckert, “Slavery and Capitalism,” Chronicle of Higher Education, December 12, 2014, http://chronicle.com/article/SlaveryCapitalism/150787/
  5. [5]Ayn Rand, Atlas Shrugged (1957; repr., New York: Plume, 1999).
  6. [6]Philip Kitcher, The Ethical Project (Cambridge, MA: Harvard University, 2011).
  7. [7]Sven Beckert, “Slavery and Capitalism,” Chronicle of Higher Education, December 12, 2014, http://chronicle.com/article/SlaveryCapitalism/150787/
  8. [8]Daniel Stedman Jones, Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics (Princeton, NJ: Princeton University, 2012).
  9. [9]John H. Bodley, Victims of Progress, 5th ed. (Lanham, MD: AltaMira, 2008); William J. Burroughs, Climate Change in Prehistory: The End of the Reign of Chaos (Cambridge, UK: Cambridge University, 2008); Max Oelschlaeger, The Idea of Wilderness (New Haven, CT: Yale University, 1991).

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