We gain our understanding of the world through the lens of theory. For revolutionaries, the basic laws of behavior of a capitalist system were already understood and advanced over one hundred and fifty years ago by Karl Marx and Frederick Engels and their comrades in struggle. Thankfully, their work is constantly being updated and applied to contemporary conditions. We can rely on those who have proven themselves excellent educators for an introduction.
Although many will already have learned the basic laws of capitalist behavior from other equally good educators, both those new to Marxist economics and many who have engaged with it for decades, will find Hadas Thier, A People’s Guide to Capitalism (2020, Haymarket Books) to be a most helpful introduction, including illustrations and applications to contemporary examples.
To confront and address the multiple crises we now face, our greatest need is for recognition of the present stage of capitalist development and corresponding action. We will not successfully address these crises otherwise.
Often disregarded is the obvious fact that all theories of the historical development of humanity’s social existence begin with ecological relationships, specifically the relations among people for making our way through nature. The historical evidence is quite clear, however, that communal relationships among people and commensal relations with other living things has not only characterized our origins as social beings, but continues to characterize us, although contradicted by the violence necessary to the maintenance of class division.
We do not have to look far for models of communal relations, including communal morality. Nor do we have to look far to recognize our dependence on a healthy, human-life sustaining environment. Solidarity and alliance between the environmental movement and the first nations is an essential condition for achieving an eco-socialist future.
How then did we get to this point in human history, where the opportunity for a future is now challenged by the violence of capitalism? When a combination of local environmental circumstances and technological developments first enabled the gathering or creation of substantial surpluses beyond humanity’s immediate needs for survival, class divisions began to emerge. The management of these surpluses were in time accompanied by privileges accorded those whose contributions were greater than others. These led much of humanity down the slippery slope to hereditary rights, including patriarchy, slavery, hereditary land ownership, a mercantile class, and private control over the means of exchange (money and credit).
Capitalism, the exploitation of wage labor, was the very last step in the emergence of class divided social relationships. Every other kind of exploitative social relationship has continued to exist, subordinated to capitalist class hegemony and accompanied by the ideological accoutrements needed to justify exploitation and oppression.
Capitalism remains a dynamic system, still able to search for room for its continued existence, but also able to retreat to feudal relationships as room runs out for continuing exploitation of wage labor. But, unlike localized civilizations of the past, as a now global system, there is not much room, if any, left for capitalism’s expanded exploitation of natural resources without deepening the existential crisis humanity now faces.
Within the first countries to industrialize, capitalism has long passed the stage of development studied by Karl Marx. England and the anglosphere of British colonial settler states are no longer the workshops of the world. The surplus value extracted from the productive labor of the working class within the developed capitalist countries no longer sustains the capitalist oligarchy residing within these countries, nor does it fully sustain the largely service workers which comprise most of the population of these countries. In this regard, by productive workers, we mean, following Karl Marx, those engaged in the extracting and producing of products from nature. These include the wage, contract, and salaried workers engaged by the capitalist class to produce goods, primarily in industrial production, agriculture, forestry, mining, and fishing. Statistics Canada, for example, includes only about 6% of Canadian workers in these categories. [Canada: employment level by occupation 2021 | Statista]
Marx, with good reason, studied capitalism during the decades he lived in England. In most of the world capitalism was still to emerge as the dominant form of social relationships. Only a century and one half after Marx’s death, relatively low average rates of profit during the past half century suggest we are likely witnessing the last stage of capitalism’s viability as a globally dominant system of socio-economic relations.
With cyclical variation, the average rate of profit in the core capitalist countries fell from somewhat greater than 50% in 1870 to somewhat greater than 10% by 1980. Since 1980 it has varied cyclically at values within a few percentage points of 10%. For this data, and for an account of the method used for the calculation of the rate of profit, see: Michael Roberts, The Long Depression (2006, Haymarket Press) p20-21.[ The Long Depression: Marxism and the Global Crisis of Capitalism: Roberts, Michael: 9781608464685: Books - Amazon.ca] and Michael Roberts, Marx 200: a review of Marx’s economics 200 years after his birth (2018, Lulu.com), especially p42 for specific data for the UK and p55 for the corresponding data for the US [Marx 200 – a review of Marx’s economics 200 years after his birth: Roberts, Michael: 9780244076252: Books - Amazon.ca]. In connection with the latter (p55), he argues that “capitalism is not exhausted yet…. The centre of accumulation has shifted in the last 200 years, [first] from Britain to Europe in Marx’s time, [then] to the US and parts of Asia in the 20th century and now towards China and India. And there are still more areas to exploit labour power.”
It is clear, however, especially since 1970, the capitalist class within the core capitalist countries has depended on the relocation of the industries under its control to countries where it is able to extract higher rates of profit from labor. Depending on the interpretation of the historically low average rates of profit earned by private businesses within the core capitalist countries, it is already reasonable to question whether capitalism within the core capitalist countries could survive without the imperialist rent their resident capitalists, primarily financiers, extract from the rest of the world. The resident capitalist class within the core capitalist countries and the coterie of upper management and senior mercenaries (military, political, and academic) they depend on, would otherwise be left only with the income they extract from a feudal relationship with most of those in their home countries who depend, either directly or indirectly, on income from work.
This reality is most evident in the behavior of the various factions of the United States ruling class. The duopoly of governing political parties and the principal investors in the outcome of US elections are behaving increasingly like feudal lords, or worse, feudal lords in distress. The clearest example is their current behavior in relation to Russia and China, including dangerous recklessness with respect to the potential of a war in which nuclear weapons might be used, either intentionally or accidentally.
To get to this stage within a mere couple of hundred years, capitalism has already undermined its own viability as an economic system. Driven by the profit motive and competition between capitalists, capitalism has rapidly reduced the need for labor to produce the material goods humanity needs for its existence and at the same time, has rapidly undermined the capacity of the Earth’s biosphere to support human existence. The golden age of capitalism within the core capitalist countries was already over by the 1970s.
With reduced profitability from the exploitation of productive wage labor within the core capitalist countries, its capitalists have relied on foreign investment, resulting in a transfer of profits and material goods from outside to inside the core, in other words, global imperialism.
What has continued, is the destruction of the biosphere as a home for humanity and the reduction of opportunities for capitalist expansion. Capitalism has dug its own grave. No mere reform can save any part of humanity from the crises we now face.
At the same time, by inadvertently developing technology and providing the education needed to utilize this technology, global capitalism has created the means for construction of its alternative, a global civilization able to manage humanity’s relationship with nature and achieve an equitable distribution of goods and services within and between countries.
Along with opportunities for revolutionary transformation, capitalism has also created barriers to be overcome if humanity is to find a way out of the socio-economic and ecological crises it has created. The primary barriers are the economic and military power of the United States, subordinate international institutions, a global network of comprador capitalists and mercenaries, the imposition of the of the US dollar as the primary currency for international trade, and the global influence of US capitalist culture.
Necessary to successful transition from a dominant capitalism to a socialist alternative are:
- Multipolarity as a strategic necessity, responding to the right and demand of all people to achieve their own economic and cultural development, countering the hegemonic power of US imperialism and its allies.
- Global collaboration, cooperation, and solidarity among the progressive forces.
- Commitment and action by the progressive forces in all countries to the expansion of the commons, including the restoration, protection, and sustainable management of our natural environment, the end of private ownership over knowledge, and the expansion of free services and essential goods needed for human health and well-being.
The elaboration of some of these arguments can be found in eleven articles co-authored with Karen McFadden and published on Green Social Thought (www.greensocialthought.org ). These articles have been assembled and made available on the homepage of Karen and my website, https://greensocialdemocracy.org