What Is Capitalism?


- I don't know how you can stand coming to this Starbucks. Where do these people go to when it closes? What time is closing?
- 12:30. That big man - he admits to weighing 300 pounds - the days he gathers a little money playing guitar on the street; restaurants to give him food in exchange for posting on social networks video reviews he makes on the spot. When they lock the doors here he'll push that cart you see outside down Beverly to a doorway of one of the high design furniture showrooms.
- Where he'll sleep?
- Yes.
- Who are the others?
- Drivers from Armenia. A couple of medical students. That man I suppose was just released from the hospital where he was kept locked in for observation. He'll wander up and down the streets all night.
- Going nowhere. Let's change the subject.
- Fine.
- On the subject of a past conversation, why political critique doesn't seem to change anything:* what do you think happened with Karl Marx? His ideas changed the world, but not really for the better. He was wrong in his predictions of collapse of capitalism and worker led revolution. But people are talking about him now because he was right about increasing inequality.
- Maybe only his timing was off. Capitalism's collapse and worker led revolution are coming. Is the timing right for us to talk about this? The cafe closes in 15 minutes.
- Then don't waste any time.
- You know how we often talk about ritual as a spontaneous social structure, a social behavior that seems to be an inherent possibility of human nature? Marx made his predictions about the future of capitalism assuming the presence of several of these sort of machines in capitalist society.
- And these machines were?
- (1) Advance in technology allows products to be made cheaper, workers to be paid less, and employers make profit. (2) Competition in the free market drives down prices, allows workers to be paid less, forces development of new technology, and employers make profit. (3) New technology not forthcoming at cheap enough price, employers increase their demands on workers to the point where these part-time slaves, wages at subsistence level and working all waking hours, are indistinguishable from full-time slaves.
- More injections of technology. More competition in free markets.  A race to reestablish slavery in all its purity. The fact of there now operating such social machines...
- But is it a fact?
- Assume they exist as along a path a society may or may not take. The path offers a direction, not a destiny. Society can get on and off. There being such machines possible, workers living in the midst of their operation Marx believed would wake up to their enslavement and rebel.
- Look around you. Where's the revolution?
- I think I know why. They're closing now?
- We have a couple minutes. Why no revolution?
- Marx's story of history progressing from primitive communism maintained by ritual, to slave agricultural society, kingdoms, feudalism, capitalism, and finally communism again, this time with technology: this is somewhat like the story told by Kabbalah, but with a big difference. In Kabbalah, progress is made accumulating good in the world, not in reaction to accumulation of bad.
- Kabbalah's machine is located in a world of persisting beauty, truth, wisdom, not society.
- That's right. Marx's ideas were applied in China and Russia, seeing only, reacting only to bad accumulations, bad machines. But Marx himself wrote: "I can only relate myself in a human way to a thing when the thing is related in a human way to man."** To take the final step out of slavery requires more than knowing you are a slave. Knowledge from taking that human way has to be allowed to accumulate. Relating myself to the world in a human way requires that I step off the path that surrounds me with people and things that are not related in a human way to me.
- Then we'll see about the revolution. Closing time.


To continue where we left off. Spending our leisure time on premises owned by the corporate giant Starbucks, consuming its products under pressure to be quick...
 - Yes, yes. You claimed capitalism involved ritual-like spontaneously occurring social arrangements in which technology increases productivity, allowing employer profits. A second spontaneously occurring social arrangement was the free market's competition being applied to the first arrangement, making sure technology is endlessly and continuously applied to reduce costs, and provide employer profits. Am I summarizing correctly?
- Yes.
- When in the past these social machines couldn't be applied, when technology wasn't up to the task, wasn't cheap enough, employers made use of a reserve army of unemployed they'd gone to the trouble of creating for times like these, or collusion among each other to fix wage rates, or monopoly control of markets, to directly take their profits from workers in the form of reduced wages or longer working hours. Correct?
- Yes.
- Technology and the free market have been put to the service of extending part-time slavery into full-time slavery. My question to you is: you said this activity is like ritual in being a spontaneous occurring social arrangement; but isn't it itself ritual? And if so, what does it express as a ritual?
- Employers first acquired their capital by violent acts dispossessing their future workers of land held in common, and by other aggressive manipulations that have no connection with technology and the free market. Employers go back to use of these means when technology and the free market fail them. Linkage of slavery to technology and the free market regularly fails, is established, and recovers from crisis by means of actions inconsistent with, that do violence to technical application in the free market. Violence, and myth-like lack of consistent practicality, suggest ritual.
- Again: ritual expressing what?
- That if an "accumulation of wealth at one pole is, therefore, at the same time accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation, at the opposite pole,"*** that is the result of the functioning of natural laws of market and technology. Ritual serves to hide from ourselves the fact our society is based on violence and slavery.
- Then it's true?
- Capitalism is ritual? The formal requirements are met: repeated acts reenacting a story of emerging out of weakness reborn into strength by means of violent, unquestioned acts in the company of others. You and me here at Starbucks, consuming the corporate employer's products at higher and higher prices, we are like slaves forced into a dance with a fanatical master. I don't know. Dancing with us do corporate employers feel powerful and reborn?


- Capitalism moves towards a closed system. Those dispossessed from their lives on the land become employees. Employers make a profit out of the labor of their workers who can't afford to buy the products they make: with employers profit added the total cost of products is more than the total of workers wages. Workers can buy only a fraction of what they produce.  Employers consume some of the excess. The rest must be sold in territories outside the system. As capitalism and the free market expand their reach, and populations in the territories, dispossessed from their lives on the land, become employees producing additional products that have to be sold, that outlet is closed. Competition drives advance of technology; the amount of products made for fixed cost increases. But workers can't pay more for employer products than employers pay them. Employers have the choice of hoarding the excess products, or allowing with higher wages workers to have some of them and live more than a life of subsistence: maybe then they'll work better and make more products.
- But how do employers profit from that if all they can get from their employees for their products is the same amount they have paid them in wages?
- They allow them credit to buy more.
- But that is their money too!
-They don't let it get too far away. In one scenario workers buy houses on credit at low interest rates, the boom in house buying is followed by a bust, interest rates are raised, refinancing is impossible, payments become unaffordable and houses are repossessed.
- Poor workers. Made slaves, dispossessed of their land, are allowed to buy back land, only to be dispossessed again! Is it a stupid question to ask why employers don't stop persecuting their employees and let their businesses run on without profit? Why do the rich-beyond-any-use capitalists think they need their profit?
- A company doing business in the billions operating without demand for profit presently exists: the watch manufacturer Rolex. At the death of its owner the company became a private foundation without loss of competitiveness.
- Then there is no institutional, practical necessity for profit.
- Profit isn't the only value. Have you ever tried to read Marx's Capital?
- I tried.
- Even second hand, hearing it discussed, I experience a strange sense of unreality. Value, Marx says, is socially useful labor. Employees produce that value, but employers take most of it for themselves as their profit, without doing any socially useful labor themselves. Their relation to their employers, labor, is used to explain what money is, to prove that employers are robbing employees of what is theirs.
- What's wrong with that?
- It's an explanation in terms of the severely limited world of the marketplace where everything is to be bought and sold, including people, that is, from the world of part-time slavery Marx is trying to explain. In the larger world something is socially valuable passed from one person to another as an act of sympathy, as participation in another's life, as a creative act, as an act of humor, as an act of disencumbrance...
- All of which hasn't the slightest meaning to capital's slavedrivers. They won't willingly give up the god-like act of remaking human beings from part-time slaves into full-time slaves. They're in it for the hell of it.


- What is capitalism anyway? Adam Smith's free market?
- Capitalism goes on fine without it. See the monopoly controlled, subsidized, cartel-ridden, government bribed big business U.S.A.  
- Marx's wage labor plus class struggle? 
- That's a little closer. 
- Then you tell me.
- Capitalism is wage labor that uses its wages to buy products it has made. 
- A cycle.
- Yes. 
- Why?
- Why what?
- Why not slavery pure and simple? Supply the slaves food and shelter, and employ them to build pyramids to your glory or to make you luxuries. Why have them buy back the products they have themselves made?
- It has to do with the social instability of the times and the development of modern science and its similar non-stop cycling: results of research and experiment are turned to technology which yields new research, experiment, and technology. In the capitalist cycle, money invested in production pays employees who use the money to buy products they themselves have produced. Money cycles through the production process back to the employer, to be reinvested. The world may be changing all around, but life is clear to scientist and capitalist: discover the rules, apply them, repeat. For the non-scientist, non-capitalist, there's a problem: we know the rules of the world, but not of the mind, or of the mind's relation to the world. The philosophy that develops around the time modern science's cycling begins solves the problem by identifying mind and body, in the words of Spinoza, as two ways of looking at the same thing. Or in the what we call now 'process philosophy' of Marx: seeing in the world the action of the self in coming to know it; seeing in the self the world it has developed acting in response to. The employee has his world removed from his grasp when the product he makes is taken away from him as the property of his employer. Separated from the world it had been acting on, the employee's body is seen to perform meaningless repetitive actions. Later, when the hours of wage slavery have expired, exercising his freedom, his mind is engaged in attempt to recover his lost self that has been mysteriously attached to one of the objects he and others like him made and now are offered back to him for sale. The employee, who becomes a material in the production process as the employer solves his mind body problem, becomes part of the world to be researched and incorporated in new management techniques. As a human being the employee is invisible to the employer, part of the body that is no problem. The employee, if seen at all, elicits contempt as a failure, while the employer in his own judgment is an undeniable success as he participates in the great creative cycle of money passing through production back to money, money representing mind, the production representing body. The world we live in, capitalism triumphant, loads the majority of people with the unsolved mind body problem. Overwhelmed with the practical difficulty of getting enough money to keep body going, body becomes alien, standing in the way of creative intentions.
- The employer has contempt for his employee's life failure. But what the capitalist is doing - it might make the mind body problem disappear, but it isn't really creative. It is loveless, destructive of human lives, profoundly ugly.
- As it must be. The stable class relation between employer and employee, locked together with a machine's causality, is like that of the warrior class and the producer class in the city imagined in Plato's Republic, a utopia of total management in which justice is supposed to be writ large in the relation between classes, membership in which guarantees not the least happiness.****
- Capitalism's destination is Plato's Republic? Seriously?
- We'll have to see. Workers have their cycle: product - wages - product. Employers have their cycle: money - product - money. Scientists have their cycle: knowledge - technology - knowledge. These cycles working together end in forming the three classes of the republic: producers, warriors, guardians. At which point all cycles cease. The workers can only work, all means to do anything else having been squeezed out of them by capitalists demand for profit. The capitalists, with no more profit to be made out of workers, settle down into the warrior role. They protect the little world of the republic acting in which shows them who they are; they protect the republic against all those who do not have their being made by acting in that little world. And scientists, they turn to the task of keeping the republic free from change, workers working, watchdogs being watchdogs.

Further Reading:
The Politics Of Truth
The Technology Of Good
Let's Sue Starbucks
Laugh & Do Nothing
** Karl Marx, Economic and Philosophical Manuscripts of 1844
*** Karl Marx, Capital
**** In modeling behavior on the unified activity of a city, science, or life process, rest from movement is alienation, disorganization; while for an individual, in suspension of movement unity of self and world is intensified in the recollective experiences of love, beauty, and truth. See How To Read Plato's Republic, and Noam Chomsky & Mental Things.