As used by right-wing apologists for “free market capitalism” (an oxymoron if ever there was one), capitalism is the source of everything good in the world — but also something that never existed. And it switches repeatedly back and forth from one to the other, every couple of sentences, in the same argument. I learned this from interacting with the right-libertarians who’ve been using the “anticapitalists with iPhones LOL” meme to troll the hashtag on social media.

I stated (I can’t claim originality — I think maybe the original was David Graeber?) that “Capitalism didn’t make your iPhone. Workers did. Capitalism just determines how the rents are distributed.” In response, someone said “Capitalism created the freedom that allowed people to invent the iPhone.” I pointed out to them all the ways that Apple’s profits from the iPhone depend on the use of the state to restrict freedom, both directly by using “intellectual property” to impede free cooperation and replication of technology outside their corporate framework, and indirectly through state subsidies to the offshoring of production to countries where workers are easier to exploit. The would-be defender of capitalism immediately piped up “What do subsidies have to do with capitalism? That sounds more like government to me.”

Aha. So the iPhone demonstrates the wonders and productivity of “free market capitalism,” but all the state-enforced monopolies, subsidies and other government intervention that Apple’s actual profit model depends on are “government.” Gotcha.

Sorry, but you can’t have it both ways. You can use “capitalism” as the name either for an idealized free market system that has never existed in practice, or for the actually existing historical system that you’re an apologist for. You can’t do both. If you start with the corporate capitalism that Apple is part of, and then take away the historical legacy (and ongoing process!) of peasant land enclosure, colonialism and neo-colonialism, slavery, land and resource grabs, “intellectual property” and other monopolies, and restrictions on the free movement and association of labor… well, you don’t have much left.

If you want to argue that “real capitalism has never existed,” and repeat “That’s not capitalism, that’s corporatism!” like a broken record, fine. But you can’t turn around then and use the products of a transnational corporation like Apple as an example of capitalism. If you do, you’re either stupid or a liar. It’s that simple.

And when you get right down to it, “capitalism” is a really bad term for a free market system. The word originated in the early 19th century as a name for the real-world historical system of capitalism, that emerged from the late Medieval economy from about 1500 or so on. And the state was absolutely integral to the emergence of that system of political economy, and to the form it took. It was a system in which the state actively intervened in the market, in all the ways (and more) I listed two paragraphs above, and did so on behalf of capitalists.

The use of “capitalism” by self-styled “free market” advocates only came later. It was a word that already had a long history — a history, in Marx’s words, written in letters of blood and fire — and was clearly identified with specific class interests. So when Mises and Rand chose that word, a word with those bloody associations and class identifications as their name for the “free market” — and named their ideal system after capital, one particular factor of production, at that! — you damn well better believe they had an agenda, and knew exactly what they were doing.

Corporate capitalism is not the free market, no more than was Soviet state communism. Both capitalism and state communism are coercive systems of power that parasitize on the creativity and cooperative labor of freely interacting human beings, so that those in power — whether CEOs and coupon-clippers or commissars — can live off the products of ordinary people’s efforts and ingenuity.

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2 Comments When is Capitalism Not Capitalism?

  1. Anthony Hazard

    Haven’t time to read it all yet. Amazed the vast number of filters this person, hides behind to defend this “uter nonsense.” Apparently he thinks those workers work for free. In fact they worked for money. The Money only capitalism can provide. patent rights which makes invention and innovation possible. Since Money is in fact what makes the world go round. Those workers eat raise children, inspire of those anti-capitalist. The USSR, didn’t allow property rights. They became proficient at copying, stealing, others invention. Without, patent rights no one can afford the time and effort, to invent or innovate anything sence “time” and “money” are interchangeable. Pilots don’t fly airplane’s Money does.Solders don’t fight wars money does. There’s nothing without money. Capitalism is the most certain producer of money. Capitalism is the source of freedom. Without property rights manufactured weapons of self defense would not exist. You point to all these laws which restrict rights. Without laws and power provided capitalism. The human race we would spend our time hiding from predictors and other humans as those mean old right ringers point out freedoms isn’t free and nothing else is free. If your male tell me about all the FREE sex you enjoyed. I’m sure you envey all those free riders in Europe (read socialist) who remained free because the the closest thing to capitalist nation. US, payed there way we built hundreds ICBMs thousands of B52. We guarded Europe with millions of American soldiers. Property rights gave us all this power 44yrs of sacrifice gave the rest of the world a chance to one of the greatest disasters in human history. None of our enemy’s had patent right. They all went down when there citizens could no longer. Maintain the physical strength required. I notice your writings are freely available. A good indication of there actual value. Perhaps it would be better for you to go live a year or two. Mile just south of the DMZ South Korea, live some place where poor means you didn’t eat last week you haven’t eaten this week and next week is just to far away. See what it’s like to live in a place where the most dangerous thing you can do is walk on land that isn’t being farmed. Land that isn’t farmed is a clear certainty that your looking at acmine field. These mine fields are cleared because it is just to great an investment when at any moment “Joe Chink” could come guns blazing and destroy everything hundreds of generations have suffered to build. A place they could call home. Where ever you find monster governments you will find the USA there in some way trying to help. Have no fear you won’t find the troops of those semi-socilist Nordic countries. These Nordic countries want peace through out the world so badly that they will let American lives be spent there .
    Sorry but got to go. I really enjoy my capitalist breakfast

  2. Alex Pazaitis

    @Anthony Hazard
    Your first sentence is quite representative: “Haven’t time to read it all yet”. All the different aspects discussed in your long and unstructured comment strengthen the articles main argument. Money, enclosure, violence and warfare, exploitation and poverty are all some of the main driving forces of capitalism. Freedom is not one. And if freedom for the “first world” means enslavement and impoverishment of the “rest world”, then our conceptualization of freedom is quite distorted. You cannot divorce today’s achievements from the history that led them. And in case of capitalism, this history is one of blood and fire, that’s for sure.

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