What Is Capitalism, Exactly?

Russia Today seems to be a news organization growing in presence and penetration. It is, of course, not without an agenda, but for now at least it covers stories of interest to the 99%—to use the modern vernacular—far better than the mainstream. I drop by from time to time and watch any articles that catch my eye. Last weekend a debate on #ows did just that. An early theme that emerged in the opening minutes was that America had yet to experience true capitalism, that Wall Street was not a capitalist phenomenon, that until we got true capitalism we’d just be digging a deeper debt-hole for ourselves, and the socialist rich would continue to fleece the 99% and charge them for the pleasure. Oh yeah, and growth would not return. It’s an argument I’m sure you’ve all heard before. And it begs one blindingly obvious question: What the hell is capitalism?

At risk of annoying those who want to know, I suspect there are as many answers as people chancing an answer. Which is I suppose good in some ways, but bad in others. However, if capitalism can be any number of things depending on whom you ask, the assertion that some pure or true capitalism would put America or Europe or the world Back in Business is vague and unprovable. Furthermore, if the world has never experienced True Capitalism, how can we know it would work? And, is it even tenable to assert that something as vague as capitalism has a ‘true’ form, and what does it mean for such to work? These are not easy questions to answer. In fact, there are no answers.

My position is vague too, I admit it, but—I dare to suggest—less vague. Whatever we call The New Way (I’m with those who refer to it as resource-based economics, but that’s totally cosmetic, little more than a temporary holder), we cannot know from this distance the details of its operating, which would be emergent and changing anyway. But a New Way it will most definitely be. What I do not seek is a ‘return’ to, or arrival at, some pure, ‘free’ market oiled by an optimally minimal amount of ‘government interference’, because such a wish makes absolutely no sense to me. Not only is there no separation between the fictions of Market and State, there is no such thing as freedom. Acceptance of this will set us ‘free’ (ha!) to build The New Way from the ground up. And so, from a fresher perspective, a free market is exactly what I wish for.

Deep in the Myth of the Market I spy the seed of something radical, and that is direct democracy and its potential flourishing via the Internet (or similar infrastructure and software). The very idea that everyone’s dollar is equivalent, has purchasing power and therefore ‘political’ power too; that none can steer the market to their own egomaniacal ends, is a healthy one. The problem with it, is that money is necessarily powerful, operates as a commodity with value even as it is a mere measure, and that being rich is ‘better’ than being poor.

Because outcomes cannot be equal, because people are not uniformly ‘rational,’ motivated and well informed, the messy and unpredictable competition of markets can only lead, in this system, to grossly unequal accumulations and distribution of money and property. Under the current rules of the market game ‘success’ is about victory over, or at the expense of, other market participants. Competition is nothing unless it produces winners and losers.

In this system, healthy unequal distribution (uniformity of outcome is flat out impossible) generates unhealthy and stubborn rich and poor divides. When, by definition, rich is Good, and poor is Bad, why should we expect a different result? There is a constant incentive to game this system for ego-based ends; the rich seek to maintain the current distribution or tilt it even more in their favour, the poor to Get Rich by any means possible. The power lies with the rich, however, since they can afford lawyers, lobbyists, the best education, etc., to help them and their kin stay ‘on top.’ And none of this has anything to do with blame, except at the systemic level. As humans with empathy and imagination, we can imagine what it’s like to be rich or poor, so seek the former and avoid the latter (as a rule) and set up systems that survive across generations. Hence stubborn rich-poor divides, class divisions, and so on.

So the ‘free’ market dynamic so many yearn for can only generate the very monopoly problem it is thought to avoid, while our foundational assumptions about reality include scarcity, Separation (as Charles Eisenstein means it), greed and competition, and denigrate, or think illusory, abundance, cooperation and trust.

"What," as Mr. Fussy was wont to say, "to do?"

Well, to be vague, in conjunction with a change of consciousness, we change the rules and goals of the game, by changing the money system to fit what the new consciousness desires, perceives, understands. Until we address the stickiness of money, its ability to glue divisions in place and keep them there at all costs, the Market-State hierarchical extraction dynamic will operate as we have seen historically thus far, turning ‘idle’ resources into goods and services for sale at an ever accelerating pace, to the enrichment of the 1% (10% really), recently as aided and abetted by fossil fuels and our burgeoning technological prowess. Furthermore, exacerbating the problem of what I’m calling money’s stickiness is the usury attached to its creation per fractional reserve banking, such that the money system must constantly increase the money supply if it is to pay off the interest owed, which requires a forever growing economy. Consequently, growth is what ‘backs’ money in this system, hence our blind allegiance to the god Perpetual Growth, and our systemic subservience to it. We are witnessing today the system’s breakdown, for the simple reason that growth cannot be reignited as the system demands.

The money system is a problem generated by a consciousness (or paradigm) of scarcity, fear and greed. They reenforce one another, co-create each other in a positive feedback loop, and we are still in their (its) grip. But we are breaking out of it at last. There are multiple suggestions ‘out there’ to help us grow a new system from the soil of the new, emerging consciousness.

The Venus Project and The Zeitgeist Movement call for a new socioeconomics which would render redundant the need for any medium of exchange, but are sketchy to silent on how to transition to such a different system. Their idea to give away goods and services at a price of zero, to all people, by producing more than enough across the planet, is beautiful, but too outlandish and far-off to find sufficiently deep purchase in the current culture’s soil, as evidenced by The Venus Project’s relative obscurity after decades of dedicated promotion and campaigning. The Zeitgeist Movement is concerned primarily (and rightly so in my opinion) with dissemination of information and analyses which help others more critically appraise the status quo so as to be readier for change when it comes, and more able to introduce it wisely.

Charles Eisenstein calls for the buying of existing debt with a fiat, negative interest currency, not debt-based; the end of income taxes, and the introduction of biting taxes on environmentally damaging mining, manufacture etc.; a social dividend ‘funded’ by that money drained from the economy via the demurrage rate and environmental taxes; for minimal (or no) private property, maximum commons, revolution in the education system; and multiple money types to meet flexibly various economic needs. It’s all laid out in his book, “Sacred Economics”.

Franz Hoermann and his ‘team’ call for a minimum of two “billing circuits”, such that matter (as mined, farmed, grown, etc.) is to be ‘tracked’ by one type of money, and human creativity (labour and other societal contributions) by another. ‘Money’ is to be totally electronic and transparent, created (as in Ithaca Hours) at the point of the transaction, which means locally at the level of the individual, managed by an Internet-like infrastructure, and to be seen as a means of keeping tabs rather than as wealth. In this ‘plan’ (better; set of ideas and suggestions) there is to be a social dividend in the form of an ‘overdraft facility’ at the level of the personal ‘bank account,’ which incurs no interest. There is no interest anywhere in the money system. Bankers become advisers to people seeking help on the best way to contribute to society. Private property would likewise (as in Eisenstein’s model) be phased out. Education would be a far more open affair. (Further details on this are available on YouTube in German, or at this blog as translated by me.)

There are many other ‘plans’ out there, from Freegold, to 100% reserve banking, to MMT. My ‘money’ is on some mix of the above.

But change is underway now, globally, in the form of Occupy Everywhere, which is the early beginnings of the creation of a new decision-making sociopolitical apparatus, which will mature and develop as it does, beyond the control of any individual or monopoly. As such it is a genuinely ‘free’ market (to the extent such a thing is at all possible) because it is motivated by transparency and cooperation, which has The New Way both as its goal and means (means are ends). The establishment of these means is to include the contribution of anyone who wishes to be involved. In this ‘market,’ this bazaar, the ideas and suggestions humanity has to offer can be discussed and critiqued, including how to get direct democracy up and running, scaling that up beyond the local, and slowly building the mechanisms which will transcend the current status quo, and render it redundant. If some people want to call this process True Capitalism, they can. Who am I to say no to that. My contribution (or desire) is adherence to a transparent and cooperative process which allows the stronger ideas to rise to the surface of human consciousness, globally. Science, feedback from nature, open-mindedness and concern for the environment will take care of the rest.

The earth belongs to no one. No one. Life (or Universe) is a web of ever-changing interrelationships which cannot be frozen into some ‘preferred’ arrangement, and includes humanity as deeply as it includes asteroids and weather. Humans are not separate from Universe. Existing ‘rulers’ only rule over others for as long as those others agree to that rule. Law, convention, tradition; all are negotiable, and being human inventions steeped in inescapable ignorance, need to be treated with a wise but cool attitude which allows us creative flexibility going forward. I agree with those who see an enormous sea change sweeping across the human sphere, that our consciousness is reaching out to a deepening appreciation of cooperation, interdependence, emergence, embeddedness and community. These ‘new’ desires can find no fruitful voice in this system of Perpetual Growth, consumerism, cynicism, propaganda and hierarchical ‘control.’ In the manner of autopoiesis (self-creating) we, the 100%, are giving birth to the soil that will nourish their flourishing, regardless of the label we choose to attach to what one day emerges as Our New System. What it will not be is the flowering of the neoliberal dream of homo economicus, locked into guarded competition with the rest of Universe in a battle over scarce goods and services, whose cost is the endless rape of nature in pursuit of the barren dream of Shiny Cars, Huge McMansions and other Bling Mirages.

So, my answer to the question I set myself in the title: I don’t care. It’s not history or some pragmatic, academic purity which should be guiding us, but our humanity and its embeddedness in the rest of nature. Chris Hedges:

Macdonald argued that those who wanted change had to base all actions on the nonhistorical and more esoteric values of truth, justice and love. They had to retain Danton’s call for audacity. Once any class bows to the practical dictates required by effective statecraft and legislation, as well as the call to protect the nation, it loses its moral authority and its voice. The naive belief in human progress through science, technology and mass production, which this movement understands is a lie, erodes these nonhistorical values by placing faith in state power and fantasy. The choice is between serving human beings or serving history, between thinking ethically or thinking strategically. Macdonald excoriated Marxists for the same reason he excoriated the liberal class: They subordinated ethics to another goal. They believed the ends justified the means. The liberal class, like the Marxists, by serving history and power capitulated to the state in the end. This capitulation by the liberal class, as Irving Howe noted, “bleached out all political tendencies.” Liberalism, he wrote, “becomes a loose shelter, a poncho rather than a program; to call oneself a liberal one doesn’t really have to believe in anything.”

Believe in us, and call yourself a human.