“Under Capitalism”?

In a couple of earlier pieces, C4SS writers Frank Miroslav and Black Cat argued, respectively, that the frequently stated principle “there is no ethical consumption under capitalism” is a “thought-stopping cliche,” and — in response — that “there really is no ethical (individual) consumption under capitalism.”

As I read it, the disagreement between them is largely semantic, and a lot hinges on what the phrase “under capitalism” means.

Black Cat frames his commentary as a rejoinder to Miroslav. And to be fair some passages in the latter’s article, if taken in isolation, might be read as an argument that individual consumption choices can make a meaningful difference. Black Cat quotes one of them:

For one to actually believe that consumer choices bear no weight, they must admit that there is zero difference between going to a fascist bar or a leftist bar (in the obvious hypothetical where all else is equal). That even attempting to support people in trying to get stuff like open source hardware off the ground is a folly.

In response Black Cat rejects Miroslav’s seeming endorsement of “ethical consumerism” with an argument reminiscent of Hilaire Belloc’s argument against the nationalization of industry. 

In The Servile State, Belloc begins by arguing that nationalization entailed state recognition of existing capitalist legal claims to the means of production, and the acknowledgement of capital’s entitlement to compensation for them at market value. As a result capital would continue to benefit from its ownership of industry virtually as much under nationalization as it would have as the owner and direct supervisor of industry. Under nationalization with compensation, the state would either 1) pay an indemnity over time that would presumably include the market rate of interest, or 2) compensate the owners in a lump sum by issuing public bonds at the market rate of interest. Either way, a major share of the capitalist class would maintain a de facto property claim over the output of the factory, and the state would be in the position of a management company running the industry on behalf of absentee rentiers who continued to derive an income comparable to what they previously had as direct owners. 

Black Cat argues, similarly, that so long as we fail to directly address the structural issues of capitalism, any attempts at ethical consumption will take place within a rigged market and will benefit capitalists one way or the other. 

GoodProduct costs a dollar extra, but is manufactured in a way that is less immoral than the manufacturing of BadProduct. GoodProduct clearly advertises this, and your own research confirms their claims. Other than the price and morality, the two products are otherwise identical. Because buying that product lets you tell yourself that you’re a good person… you value it more than you would the extra dollar that you’re spending for it — so you buy GoodProduct. 

…But, those same immoral production processes that the makers of BadProduct use probably make it cheaper to make — after all, why else would they be using them? Working child-slaves to death in a former uranium mine (or whatever) probably gives the makers of BadProduct a pretty low margin — so that price can keep going down for a while. 

If the price of BadProduct goes down far enough and/or the price of GoodProduct goes up enough, some people will start buying BadProduct instead of GoodProduct — people who might be moral enough to spend a dollar extra might not be moral enough to spend ten dollars extra, or twenty dollars, so on and so on.

This is pretty bad — after all, it seems like your individual, well-intentioned consumption choices didn’t actually push BadProduct out of the market. Not only this, but also: the net effect of this is that being a good person starts carrying a (metaphorical) ‘tax’ on it — whatever the difference between the costs of GoodProduct and BadProduct are. 

The “ethical economy” will always be operating under a disability, according to the rules set by capitalists. So, like Belloc’s taxpayers, “ethical consumers” are in effect simply taxing their own limited incomes to pay an “ethics premium.” And “ethical consumption” is simply another expensive consumer good serving a niche market. So long as the structural basis of capitalist rent extraction endures, capital wins out either way.

Therefore, Black Cat continues, collective action is necessary. 

Markets are reflective of the institutions that they exist within — and right now, those institutions are mostly ‘the state’ and ‘private property’. If you want to actually drive unethical businesses and products out of the market, you have to engage in collective action of some sort — you have to help start unions and cooperatives, you have to organize massive and publicized boycotts rather than quiet individual ones, you have to sabotage their damn machines, you have to donate to charities that fight slavery, etc., etc.. Markets are big, and you have to team up with others if you want to change them.

I agree with all this. The problem is that, on closer reading, Miroslav seems to advocate for effective collective action as well. He explicitly distinguishes what he has in mind from the liberal model of “ethical consumption,” acknowledging the absurdity of trying to reform capitalism only through individual “feel-good” consumer choice. 

The proper approach he recommends in its place is “strategic analysis”:  “engaging with the system as it is, trying to find points of weakness, and attempting to exploit them.” This means, in concrete terms, not acting on a one-off basis, but “planning for long-term economic intervention.”:

Even the most vulgar Marxist who believes in a total revolutionary break between our current system and the next must admit that the task of building a better world is a decades-long project at best. Sure, where we spend our dollars today might make little difference, but what needs to change for that to not to be the case? The world we live in is not that of simple linear processes operating on one another but rather one of a multitude of hypercomplex systems all intermeshed and feedbacking off each other. For instrumental reasons alone, economics are worth investigating simply to see how the machine works so you might figure out how to exploit it.

The distinction, I think, is parallel to that Andre Gorz made between what is commonly dismissed as “reformism” and what he called “non-reformist reforms.” And the distinction hinges on context; the proper approach is to view our strategy against the background of a capitalist system that has a beginning and an end, and to evaluate our proposed counter-institutions in terms of their functional role within a dying system, and their contribution to the post-capitalist transition.

The heart of our strategy should lie, not in choosing which capitalists to buy from under capitalism, but in simultaneously starving the capitalist system of as much of our labor and consumption as possible and building the condensation nuclei around which the successor society will crystallize.

What autonomist Marxist Antonio Negri calls “exodus” is highly relevant to this strategy, as is Massimo De Angelis’s proposal to grow the commons circuit at the expense of the circuit of capital with the aim of eventually supplanting it. 

Negri argues in Commonwealth, along with coauthor Michael Hardt, that society at large — our social relationships and social intellect — are becoming the primary source of value-added, and that capital increasingly derives its profits from enclosing the social commons rather than ownership of physical means of production. 

Capitalist accumulation today is increasingly external to the production process, such that exploitation takes the form of expropriation of the common.

Therefore the proper approach is no longer to seize control of institutions or physical means of production but to treat capital as a superfluous node and amputate it.

In Omnia Sunt Communia, De Angelis writes:

How can commonwealth be used to create a new commons system, one that increases the incidence of alternative modes of production, and increases the independence of commoners from capitalist systems…? How can commonwealth be used in order to increase the power of the commons vis-a-vis capital?… Capital can reproduce itself only by putting to work the physical, mental, and affective energies of people for its own purpose: accumulation…. Capital can mobilise social labour and subject it to its measure, to its valuing of things, through different means…. But the one thing upon which the power of capital is ultimately based, the one thing that enables it to deploy all the other means of its power, is its withdrawal of the means of existence, its ability to control, manage, distribute and shape the meaning of resources that are directly responsible for sustaining human and social life: water, land, food, energy, health, housing, care and education and their interrelated cultures in the first place. An increased ability to govern collectively these resources, to democratise their reproduction, to commonalise them by keeping state and market at bay, are conditions for emancipation for all in all other spheres of life and for make [sic] these spheres of life into a type of commonwealth that is enabled to feel a distance from capital…. To have access to these resources would allow people and communities not only to grow more resilient, to share conviviality and enjoy life, but to build a common social force to expand their power vis-a-vis capital….

So rather than the traditional Marxist model, in which we live “under capitalism” until some transitional rupture in which the workers’ party seizes control and building an ethical economy finally becomes possible, the idea is that we’re building the successor society right here and now. The phrase “under capitalism” is as meaningless, in describing this growing and coalescing successor society, as it would have been to say the growing nuclei of capitalism in the Europe of 1400 were “under feudalism.”

And one of the biggest factors on our side is the sheer inefficiency of capitalism. A major problem with most of the left-accelerationist analysis I’ve seen — for example in Inventing the Future and The People’s Republic of Walmart — is that it takes capitalism’s claims of superior efficiency at face value. Such analysis takes Marx’s language in The Communist Manifesto and in the Preface to Contribution to a Critique of Political Economy, about the “productive forces” developed under capitalism, quite literally. The technological history of capitalism is a linear one of increasing efficiency and abundance, until the old capitalist relations of production can no longer cope with all that productivity the capitalists have created. The reductio of this line of analysis is Engels’s scenario in Anti-Dühring: capitalist production keeps becoming more large-scale, capital-intensive, centralized, managerial and productive until the entire capitalist economy is concentrated into one giant super-productive centrally managed trust, and then the workers’ state takes it over under new management.

Similarly, accelerationists see a global economy of trans-oceanic supply and distribution chains, with automated inventory systems, as the apex of efficiency — the only thing left is to finish automating warehouses and shipping, automate factories as much as possible, nationalize the whole shebang and give everyone a basic income to replace their wage. The way past capitalism is through it:  just let it pursue its own inherent tendency towards increased efficiency and then take it over.

But the truth is a lot messier. The actual history of technology is one of choice between alternative technologies, and alternative ways of integrating a given technological advance into the production process. There is often no single, objective yardstick of “efficiency”; efficiency means efficiency from the perspective of some situated actor. And usually, in our society, those actors are the owners of capital or the managers of corporations. Technologies have been chosen, for the most part, in terms of how they enable extraction of a surplus. Often this superior efficiency in control over labor or in extraction of surplus labor actually comes at the expense of reduced efficiencies in output per unit of material input. And the dominant models of production and distribution are able to exist because state restraints on competition and state subsidies to operating costs make inefficient (but more extractive) forms of production artificially profitable in comparison to the alternatives.

There’s no better example than the globalized production and logistical chains celebrated by accelerationists like those mentioned above. First, long-distance shipping is artificially cheap because of a wide range of subsidies. The national railroad system in the US was created via massive land grant subsidies and bond issues, civil aviation was built almost from scratch with tax money and eminent domain, and so was the Interstate Highway System. The sea lanes for trans-oceanic logistic chains are kept open by taxpayer-funded naval forces.

The central purpose of US foreign policy for decades has been to install and maintain favorable regimes for Western capital investment in the Global South. The history of this policy is one of coups, invasions, assassinations and death squads, and millions tortured or killed. We just observed the  200th anniversary of the Peterloo Massacre, and it’s important to keep in mind that the United States and its clients have inflicted hundreds of Peterloos all over the world. Besides that, the great bulk of both foreign aid and World Bank loans have gone to building the utility and road infrastructures without which foreign capital investment would never be profitable. 

The corporate model of outsourcing and offshoring actual production to independent manufacturers in Third World countries is possible only because patent and trademark law enables corporations to retain a legal monopoly over the disposal of products produced on contract. The most important function of so-called “Free Trade Agreements” is actually protectionist: to export maximalist American “intellectual property” standards to other countries and enable this model of outsourced production. 

Because of IP law, American corporations are able to outsource their sneakers to sweatshops that make them for a few bucks a pair, and mark them up to $150 on the shelves of Western retailers. The same is true of electronic goods, whose price is mainly made up of embedded intellectual property rents, not labor and material costs. Absent patent and trademark restrictions, the most economical approach would be for the job shops in Asia currently producing Nikes and iPhones on contract to make identical shoes and phones and sell them themselves to the local market at a fraction of the price. For the majority of goods, the most efficient production model would be something like the distributed micro-manufacturing economy of Emilia-Romagna, oriented toward community production. It’s only profitable to produce products for shipment across continents or oceans instead because taxpayers absorb so many of the inefficiency costs and laws like intellectual property suppress competition from more efficient models.

But it goes far beyond that. Corporate capitalism as an entire system is grossly inefficient, depending on subsidized material inputs and the socialization of other costs, and on rents from artificial property rights and competitive barriers enforced by the state. So it’s pursued a growth model based on the extensive addition of new, artificially cheap inputs rather than using existing inputs more efficiently.

In addition to all this, capitalism is inefficient because the legacy effects of Enclosure and other robberies, combined with the ongoing upward transfer of wealth via economic rents, result in vast disparities of wealth. These disparities in wealth mean that a major share of economic activity goes toward guard labor to enforce property rights in concentrations of wealth. They also mean that most business enterprises are absentee owned, resulting in all sorts of knowledge problems, conflicts of interest, and incentive problems within corporate hierarchies. So a significant amount of corporate resources go to internal monitoring and surveillance. The upward redistribution of wealth also results in chronic crises of surplus investment capital and demand shortfalls that can only be remedied by planned obsolescence and other forms of waste production. Overall, the entire economy is riddled with bureaucratic overhead, bullshit jobs, and irrationality.

The alternative economy that’s growing up within the interstices of capitalism is just the reverse in all these regards. Because it’s decentralized and geared in large part to direct production for use in the commons, it has all the advantages Ralph Borsoi mentions in The Distribution Age of dispensing with all the marketing and distribution costs of supply-push distribution. Because it’s not based on concentrations of stolen wealth, it doesn’t require large amounts of guard labor (bullshit jobs). Because it doesn’t have privileged access to such stolen wealth — enormous tracts of enclosed land and supplies of surplus capital from past exploitation — it must make the most efficient use possible of material inputs. Because it’s horizontally organized and self-managed it doesn’t generate the conflicts of interest that require managerial hierarchies of surveillance and control (more bullshit jobs). Because it has a free and open information ethos, without the barriers to sharing information that slow down reaction time and cycles of innovation, it runs circles around capitalism. Because it uses the most ephemeral production methods possible (i.e. those which require lower capital outlays and material inputs), and minimizes idle capacity of capital goods through the sharing economy, it has no imperative to engage in waste production. 

Under these circumstances, we’re not competing at a disadvantage under the rules of capitalism. We’re creating, within the bowels of capitalism, a system of superior efficiency that outperforms capitalism, makes better use of resources, and generates less waste. This system will grow at the expense of capitalism, starving it of the labor and demand it needs, preventing the continuing expansion it needs in order to survive.

So as we build a commons-based counter-economy we’re engaging in not only ethical consumption but ethical production and ethical everything else — not “under capitalism” but inside it, eating it from the inside out.

The Anatomy of Escape
Fighting Fascism
Markets Not Capitalism
Free Markets & Capitalism?
Organization Theory
Conscience of an Anarchist