What is Capitalism?

[eric922]

I know this may seem like a very basic question, but to me it is hard to answer. What is capitalism, what defines it from other modes of production? From my understanding the main halllmarks are: private property, profits, and wage labor, two classes, one that works, and one that lives off the profits of the other class's labor.

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.

[Geiseric]

There's always been slavery, well since the male monkey took the dominant role over the female monkey in our species evolution.

Wage slavery is different from other slavery, because with wage slavery you think you're getting paid okay because it seems like you usually have enough, but in the end the money goes back to the same class who paid you in the first place and they get even more profits out of it.

[The Idler]

Distributing resources according to profit.

[Kornilios Sunshine]

The reason why all the bad things around the world exist.

[Tim Cornelis]

Marxists: a system of generalised commodity production
Right-wing libertarians: free markets
Everyone else: A system based on private property of the means of production, commodity production, wage labour, production for profits, and markets.

[Grenzer]

If you want to understand the ideals of capitalism, then I suggest reading Adam Smith's The Wealth of Nations. It's unscientific crap of course, as it presupposes a right to exploit workers, but it may give you a general idea about the foundations of capitalism.

[Tim Cornelis]

Distributing resources according to profit.

Mutualism is a form of capitalism then?

[Decolonize The Left]

I know this may seem like a very basic question, but to me it is hard to answer. What is capitalism, what defines it from other modes of production? From my understanding the main halllmarks are: private property, profits, and wage labor, two classes, one that works, and one that lives off the profits of the other class's labor.

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.

Capitalism differs from other economic structures/system due to the relationship of individuals to the means of production. Under capitalism some people own the means of production and others own only their labor which they sell to the capitalist class for a wage. Therefore, under capitalism, human labor has been commodified.

This system is unique to capitalism.

- August

[Thirsty Crow]

Mutualism is a form of capitalism then?
Absolutely.

To answer the question: to conclude that capitalist social relations are dominant, first one should inspect whether labour power had been commodified. In other words, capitalism is characterized by the hegemony of wage labour as a form under which socially necessary labour is organized, and this presuposes the existence of a class of people who do not have anything else to sell but their labour power in exchange for a wage. And yes, simple commodity production, implying wage labour, has historically existed prior to the establishment of the hegemony of these social relations best evident, for example, in England in the 17th and 18th century, and France by the turn of the 18. century. But the key here is the hegemony of one class over another, which means that wage labour wasn't a hegemonic form of organization of labour under feudalism.

Opposed to wage labour is capital which finds its bearer in the capitalist class who do not need to engage directly in labour, but may live off the profits originating in the surplus value produced by workers. The only way in which profits may be accrued is to sell the commodities produced in the market, which means that capitalist production is conducted solely for profit, and not human need (if a person has zero effective purchasing power, s/he won't be able to obtain food for example since food is also produced for sale, and not for immediate satisfaction of human need).

So, capitalism does function as generalized commodity production, and in order that commodity production might be generalized, labour power in itself must be commodified, which brings forth the formation of the working class and the capitalist class. Furthermore, production must be geared towards sale on the market (realizing surplus value produced by wage labour, out of which profits come), and ownership of the means of production must be private (though, it's very important to notice that individual ownership of MoP does not amount to private property in general, as one can also speak about class private property).

[Blake's Baby]

I know this may seem like a very basic question, but to me it is hard to answer. What is capitalism, what defines it from other modes of production? From my understanding the main halllmarks are: private property, profits, and wage labor, two classes, one that works, and one that lives off the profits of the other class's labor.

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.

Money has existed for around 2,500 years. Wage labour has existed for as long, probably. Trading has existed at least as long. Commodity production (that is, production for trade, not just trading surpluses) has possibly existed as long. All these aspects of 'capitalist behaviour' have existed for more than 2,000 years.

But capitalism is not just behaviour, it's a system. 'Capitalism' is generalised wage labour and commodity production. A few dozen or a few hundred 'capitalists' (merchants, workshop owners, landlords) in ancient Greek city states could not institute capitalism as a system, any more than a few dozen or a few hundred nobles could institute feudalism as a system.

Both feudalism and capitalism were present in embryo in ancient slave societies, but the overarching mode of production was neither wage labour making commodities nor customary dues rendered by land-tied peasants to overlords. So the behaviour may have been there, but the systems hadn't grown up yet.

The general mode of production in ancient slave societies was slave labour. Slaves worked on the big farms, which could drive small free peasant farmers to ruin; they worked in the workshops, and entrepreneurs used them. There was little scope for a 'proletariat' to develop, because it was often easier to buy a slave than employ a worker.

It took feudalism 1,000 years to develop. It took capitalism several hundred years under feudalism. Factories were invented in Italy in the 1200s. In England, customary dues were gradually replaced by rents in money, benefits in kind gradually replaced by wages, barter by buying, feudal levies were replaced by hired soldiers in England and France from the 1300s. The European banking houses developed from around the same period.

Capitalism developed until it became a local system - linking many areas of Northern Europe. Then it became a 'regional' system including Europe and the overseas empires. Then it became a world system.

So; it's not the existence of money that creates capitalism per se; nor does a tiny amount of capitaism in something else make everything capitalism (any more than pouring a can of beer into the sea makes the sea all beer). It's the generalisation that's the key.

Incidently, all of this demonstrates that capitalism is by no means 'the only way' people behave. For about 2,400 years of its 2,500 year existence, it has competed with other economic forms (not to mention the 247,500 years of homo sapiens' existence when as far as we can tell there was no capitalism at all).

[Broletariat]

Generalised commodity production.

[pastradamus]

I know this may seem like a very basic question, but to me it is hard to answer. What is capitalism, what defines it from other modes of production?

There is nothing basic about this question. This is an excellent question.

From my understanding the main halllmarks are: private property, profits, and wage labor, two classes, one that works, and one that lives off the profits of the other class's labor.

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.You are absolutely correct about everything really but there are three classes. The Bourgeoisie (Upper Class) the Petit Bourgeoisie (Middleclass) and the Proletariat (working class).

But to answer your question (an excellent one); the use of money and currency is not a Capitalist concept. It is an ancient idea, capitalism is much, much more recent than the invention of money. Capitalism has existed as a replacement for Feudalism. Under Capitalism people use the labour of others in order to extract profit. The main difference between the Feudalist society and the Capitalist one is that the class system became simplified under Capitalism. In Feudalism you had Slaves, Serfs, Apprentices, Journeymen, Priests, Patricians, Knights, Nobles, Kings. Three classes was much more recognizable and of course more simplified.

Since the industrial revolution people became conscious of the fact that another person was using their labour to gain profit - despite the fact that the said person did through the medium of the work. This made many people bitter as to the nature of their work and so Socialism was born. People clearly identified the class system and that in order to achieve a just society there had to be a system where people would be equally rewarded for the the fruits of their own labour, rather than working to the benefit of some profiteer.

I hope that I have answered your question, but if you have any others then please feel free to PM me.

[Oswy]

There are lots of ways to define 'capitalism'. Here's a possible one I just thunked up.



Capitalism is the collective product of arrangements and effects that are generated and sustained in any society where the accumulation and manipulation of capital (including private property) is the central economic force.

[EvilRedGuy]

What is Capitalism?


Exploitation.

[RHIZOMES]

I know this may seem like a very basic question, but to me it is hard to answer. What is capitalism, what defines it from other modes of production? From my understanding the main halllmarks are: private property, profits, and wage labor, two classes, one that works, and one that lives off the profits of the other class's labor.

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.

I've read a bit on economic anthropology to try and answer this question myself. The personal conclusion I have come to is that capitalism just took elements of human behavior that can be empirically observed in many societies (commodities, money, trading) and emphasised them to the nth degree (at the expense of others).

Alienation at the expense of kinship relations and social cohesion, commodities at the expense of gifts, etc. The pursuit of profit evolved from something that only a small group of people did in a certain sphere of exchange, to be elevated to a hegemonic social norm, where any other human condition was evaluated via its ability to beget more money.

This is why Capitalism emerged around the same time as the Enlightenment, as technological innovation empowered small merchants and traders to the point where they evolved into the modern bourgeoisie. Hence the reason why Marx considered the technological forces of production to by-and-large determine the social relations of production.

[Thirsty Crow]

There are lots of ways to define 'capitalism'. Here's a possible one I just thunked up.
I don't think your explanation is particularly useful because it does not explain what capital is.

[Oswy]

I don't think your explanation is particularly useful because it does not explain what capital is.

Ok, but the question was 'what is capitalism?'

On the basis that capitalism is often most fruitfully understood as a social arrangement, or matrix of social arrangements, I think I did ok. I'll let other people work through a narrower and more technical definition of 'capital' per se.

[Jimmie Higgins]

If the above is correct, I have a question. If it isn't, please correct me. Hasn't wage labor existed for longer than capitalism? I mean we have used money for centuries, but I've heard people on here say wage labor is a hallmark of capitalism so maybe I'm missing something.Wage labor existed before capitalism dominated the world, but it wasn't the main form of production which was still mostly production for use or more or less equal exchange. Profit-making also existed in the past, but it was, in pre-capitalist Europe for example, a side form of production both dependent on the feudal system and constrained by it. It took large changes in the way society was organized before profit-based production became dominant.

Or, think about it this way, slavery exists today, but it is not the dominant way things are produced for this society - slavery is done as part of the underground economy and is different than slavery in Roman society. Wage-slavery as a means to create profits is currently the main form of production in the world - there are other arrangements, from slavery to communal living, but these are on the sidelines.

[Tim Cornelis]

Absolutely.

To answer the question: to conclude that capitalist social relations are dominant, first one should inspect whether labour power had been commodified. In other words, capitalism is characterized by the hegemony of wage labour as a form under which socially necessary labour is organized, and this presuposes the existence of a class of people who do not have anything else to sell but their labour power in exchange for a wage. And yes, simple commodity production, implying wage labour, has historically existed prior to the establishment of the hegemony of these social relations best evident, for example, in England in the 17th and 18th century, and France by the turn of the 18. century. But the key here is the hegemony of one class over another, which means that wage labour wasn't a hegemonic form of organization of labour under feudalism.

Opposed to wage labour is capital which finds its bearer in the capitalist class who do not need to engage directly in labour, but may live off the profits originating in the surplus value produced by workers. The only way in which profits may be accrued is to sell the commodities produced in the market, which means that capitalist production is conducted solely for profit, and not human need (if a person has zero effective purchasing power, s/he won't be able to obtain food for example since food is also produced for sale, and not for immediate satisfaction of human need).

So, capitalism does function as generalized commodity production, and in order that commodity production might be generalized, labour power in itself must be commodified, which brings forth the formation of the working class and the capitalist class. Furthermore, production must be geared towards sale on the market (realizing surplus value produced by wage labour, out of which profits come), and ownership of the means of production must be private (though, it's very important to notice that individual ownership of MoP does not amount to private property in general, as one can also speak about class private property).

One flaw though: mutualism is not based on wage labour.