Libertarian Anticapitalism, Definitions and Distinctions

The following two comments were written by Charles Johnson in response to questions, concerns and misreadings regarding his article Libertarian Anticapitalism.

1. For the record, in the article above, I am not in the first place “discarding” the word “capitalism” or throwing the word “into the trash bin.” I am in fact using the word capitalism, fairly extensively. For instance, in the title of this post: “Libertarian Anticapitalism.” I have often used this term elsewhere as well — for example, in the title of the anthology I co-edited, Markets Not Capitalism.

What’s going on here is not “discarding” the term; what’s going on here is making clear that while I reject one use of the term — the usage of “capitalism” that attempts to make it synonymous with free markets or, say, a “free enterprise system” — I am happy to use the term according to another usage — one which is no more novel, no less legitimate, and at least as congruent with common usage. Specifically, the use of “capitalism” to refer to the wage-labor system, or to profit-dominated society, as described above.

2. You might say that this is not the “real” definition of the term, but merely the “misunderstanding” of “socialists” and “misinformed capitalists.” But I would then ask you where exactly you got the “real” definition of the term. If you want to contest the claim that “capitalism” has ever been defined, or could ever be used, with any of the three alternative definitions I discussed above, then I can only ask you to read a bit more about this subject before you hold forth on it.

3. If you want to admit that people have used those other definitions but that they were somehow wrong to do so, and that your preferred definition is the correct one, then I can only say that in my view there is no Real Definition of the word “capitalism;” the definitions of words are not written by God in letters of fire, but rather human artifacts, which we make in the course of communicating with each other, and no word has any meaning independently of the communicative use to which it can be put. And in this case, my reasons for preferring the use I put the term to, have nothing to do with some kind of fear of using unpopular words. If I was afraid of using unpopular or controversial words, then I’d hardly be using the terms “free market” or “laissez-faire” or “private enterprise” either; outside of libertarian circles, those words aren’t any more popular than “capitalism” is.

The reasons I do have, have to do with the specific communicative purpose that I explained in the article. It’s not because people think of bad things when they hear the word “capitalism,” it’s because making a sharp terminological distinction between (1) market forms, on the one hand, and (2) capitalist patterns of ownership and control, on the other, helps me to achieve a specific communicative goalwhen I am talking with people about economics. The goal, as I describe in the article, is to highlight a particular causal claim about economic outcomes (the claim that freed markets would naturally produce the kinds of outcomes I described under the headings of “the wage-labor system” and “profit-dominated society”), and to raise some questions about what the basis for that causal claim is, and about whether or not that causal claim is actually true. If using the word “capitalism” synonymously with “free markets” or “private enterprise” tends to block that conversation or obscure that underlying Capitalist Causal Hypothesis, then that is a good reason not to use the word “capitalism” that way. If distinguishing the word “capitalism” from “free markets” or “private enterprise,” and using it instead to refer to something else that I want to question or to condemn (such as the wage-labor system, or profit-dominated society), helps to get that conversation started, and helps to bring out the underlying Capitalist Causal Hypothesis, then that is as good a reason as any to use the word “capitalism” in that way instead.


From a discussion of the article at /r/Anarcho_Capitalism:

Author here.

He didn’t even address the actual definition of capitalism, which is an simply economic system where the means of production are privately owned. Anything else is just a redefinition.

You know, part of the reason I put up this post is because I’m getting tired of seeing people throw out these completely unsourced declarations about “the actual definition of capitalism,” “redefinition,” etc., as if they had in front of them some stone tablets where God Himself wrote out the Real Definition of the term in letters of fire. If you think this is The Real Definition of the term, you need to realize that it’s not necessarily obvious to everyone else that it is, and you’ll have to tell me at least where you got that definition from and why you think that that source is so especially definitive, compared to all the others that I’ve reviewed from 1840 to the present. Because that definition may or may not (on which, see below) be the definition given by Louis Blanc, when he used the term in 1840 (in the Organisation du Travail); it’s certainly not the definition given by, e.g., Proudhon (in La Guerre et la Paix) in the 1860s, etc. If you’ve got the Actual Definition and these other usages are “just redefinitions,” then they are “redefinitions” that are as old as, or older than the Actual Definition you’ve got. Which would seem odd.

Anyway, that said, I probably should have included a note about the definition of capitalism as (say) “private ownership of the means of production;” my excuse for omitting it (not necessarily a good one) is that the piece already clocks in at about 3,000 words as it is, and my take on the P.O.O.T.M.O.P. definition, if I had included it, is that the definition is itself subject to the same confusions as the term “capitalism” is.

Here’s what I mean: “private ownership” may be used to mean one of two things. First, “private” may be used to mean ownership which is private in the sense of being civil rather than governmental. If that is the case, than private ownership of the means of production is simply encompassed by the meaning of my first definition, “capitalism” as meaning simply “the free market.” (What it is for a market to be free is, in part, that people are free to earn and keep property, without any de jure limits except those imposed by the need to respect the equal liberty of others. Government ownership, to the extent it happens, undermines the free market to that same extent, because government as such is a coercive monopoly, and what it takes, it takes at the expense of peaceful people’s property rights.) This is, importantly, the sense of “private ownership” that libertarians usually mean when they talk about the importance of private property, etc.

But on the other hand, “private ownership” may be used to mean private in the sense of solitary rather than common, or personal rather than social, meaning that the titles and the profits accruing from ownership go to a relatively few people, rather than being widely dispersed. But there are many senses of “social ownership of the means of production” which are perfectly compatible with free markets — worker and consumer co-ops, for example, are a sort of distributed social ownership, and non-governmental common or public property (of the sort discussed by Roderick Long in, e.g., “A Plea for Public Property”) are perfectly possible — and, historically, perfectly common — exercises of free association and individual property rights, just as much as are personal property, sole proprietorship, corporate ownership, et cetera. For a number of anticapitalist writers (including pro-market anti-capitalists, such as Proudhon), the specific reason they spend a lot of time writing against “private ownership of the means of production” is because they are concerned about the social and economic effects of ownership being concentrated in a few hands, rather than broadly distributed, so that, e.g., the people who work in a shop are generally not the people who own it, the owners of a hospital are generally not the people who depend on its services, etc. — that is to say, they are concerned about something that they call “private ownership” not necessarily because they’re opposed to free markets (most are, but many aren’t), but because they’re opposed to “capitalism” in my third sense, to the wage-labor system and closely related phenomena like landlordism and the predominance of corporate ownership in general. A free market with ownership that is non-governmental, but widely distributed rather than concentrated would satisfy their stated “anticapitalist” norms — although only some (Proudhon, Tucker, Swartz) explicitly recognize this, and others (Marxists, Progressives) do not, generally because the former understand something about market economics and the latter do not.

Anyway, if “private ownership” means capitalism-1 in some mouths, and capitalism-3 in others, and is often (as I think it is) used confusingly to conflate the two and try to take a position for against the conflation, then it suffers from the same basic problems as the term “capitalism” itself, and does not help as a clarification of it. Hence, I didn’t offer it as one of the meanings to be distinguished; but I probably should have added a note explaining why.

For more on the same issue, cf. Roderick Long’s Pootmop! and Pootmop Redux! posts.

Hope this helps.

Anarchy and Democracy
Fighting Fascism
Markets Not Capitalism
The Anatomy of Escape
Organization Theory