9 April 2020

How to Be an Anti-capitalist in the 21st Century

by Erik Olin Wright (Verso)

David Purdy writes on politics and economics and is a member of Democratic Left Scotland.

An anti-capitalist manifesto for the modern day

Erik Olin Wright’s swansong offers a powerful set of tools for anyone wanting to know what is wrong with capitalism. David Purdy is impressed

THIS is an outstanding little book by a great Marxist scholar. Originally conceived as a sequel to the author's magnum opus Envisioning Real Utopias, published in 2010, it became his swansong. Erik Olin Wright died on 23 January 2019, ten months after being diagnosed with acute myeloid leukemia. Before he died, however, he managed to complete the first part of the task he had set himself: to distil decades of work in what he called “emancipatory social science” into a form accessible to readers who were interested in the issues, but had no desire to wade through an academic tome replete with footnotes, references and digressions.

In this spirit, Wright adopts a loose, but serviceable definition of capitalism in terms of two basic features: the (free) market and the private ownership of capital. “The market” – shorthand for a complex of separate but interconnected markets for currently produced goods and services on the one hand, and for labour power, real estate, financial assets and money on the other – is the principal mechanism for co–ordinating economic activity. It performs this function – well or badly, as the case may be – through the interplay of supply and demand and the adjustment of relative prices. The division between capitalists, who own the means of production, and workers, who as waged employees provide labour, forms the central power relationship in societies where capitalism dominates the economy and where as a consequence, most people depend on it, directly or indirectly, for their livelihood.

Class interests and moral values

Wright readily acknowledges that capitalism has transformed the world, increased productivity and raised material living standards for billions of people. But these achievements, he insists, have come at a high cost in human suffering, social inequality, cultural dislocation and environmental destruction. Two questions arise, therefore: Would life be better for most people in a different kind of economic and social system? And if so, how is a change of system to be brought about?

For classical Marxism, the answer to both questions hinged on the idea that it was in the interests of workers as a class to oppose capitalism, resisting it in the short run and seeking to replace it altogether in the long run. If workers failed to realise this, the dynamics of capitalism would soon enlighten them, swelling their numbers at the expense of intermediate classes such as the peasantry and the petty-bourgeoisie, while periodically engendering economic crises of ever greater severity. On this view, “class consciousness” consisted mainly of understanding how the world worked and how it served the material interests of the ruling class. Once workers understood this, they would oppose the system and support collective action aimed at building a socialist alternative. Marxists saw no reason, therefore, to develop a systematic ethical critique of capitalism. Workers don't need to be convinced that capitalism is unjust or that it violates moral principles; it is enough for them to know that capitalism is the source of serious harms to them – that it is against their material interests – and that something can be done about it.

This view was never well founded and will certainly not do in the 21st century. The class structure of capitalist societies has become more complex, not less, and there are many people whose interests do not fall clearly on one side or the other of the capital-labour divide. In any case, most people are motivated, at least in part, by moral values, not just economic interests. A celebrated example is Friedrich Engels, Marx's close associate and financial saviour, who was the son of a wealthy Rhineland manufacturer and for twenty years managed the family firm's Manchester branch, yet was wholeheartedly committed to anticapitalist political movements. More fundamentally, as Wright points out (p8): “Clarity about values is essential for thinking about desirable alternatives to capitalism. We need a way of assessing not just what is wrong with capitalism, but what is desirable about the alternatives”.

Normative foundations

Wright sets out to show how three clusters of values – designated as equality/fairness, freedom/democracy and community/solidarity – not only provide the basis for a critique of capitalism, but also offer guidelines for building forms of economic and social organisation in which these values will be more fully realised than under any form of capitalism. The meanings of all these concepts are hotly contested and in a short review, it is impossible to do justice to Wright's rich, subtle and cogent account of them. Its general tenor, however, is conveyed by the principles he proposes to guide our thinking about each of the three value clusters:

“In a just society, all persons would have broadly equal access to the material and social means necessary to live a flourishing life” (p10);
“In a fully democratic society, all people would have broadly equal access to the means necessary to participate meaningfully in decisions about the things that affect their lives” (p15);
“Community/solidarity expresses the principle that people ought to co-operate with each other not simply because of what they personally receive, but also from a real commitment to the well-being of others and a sense of moral obligation that it is right to do so” (p18).

The community/solidarity principle applies to any social unit in which people interact and co-operate. The family, in this sense, is a community, while neighbourhoods, workplaces, cities, nations, organisations, clubs, associations and faiths are all potential sites in which communities, “real” or imagined, may emerge. The salience of community varies greatly over time and space. Neighbours or fellow citizens who willingly help each other in the face of common adversity may be quite indifferent to the fate of strangers in distant lands. Where it does emerge, however, community/solidarity contributes to human flourishing and serves to promote equality and democracy. It is easier to accept that all people within some social space should have equal access to the necessary conditions for human flourishing when you also feel strong concern and moral obligation for their well-being. At the same time, community/solidarity has a dark side, imposing rigid boundaries between insiders and outsiders, creating a privileged status for the former, while excluding the latter. Nationalism often functions in this way. Communities can also be oppressive, stifling dissent and innovation and demanding conformity with traditional norms along with deference to established hierarchies.

Varieties of anticapitalism: smashing, dismantling and taming

Most social change operates behind people's backs as the cumulative and unintended result of human action. A strategy for social change implies the possibility of changing the world for the better through deliberate collective action. With the normative foundations of his investigation in place, Wright examines five different types of strategy which historically have been important in anticapitalist struggles: smashing, dismantling, taming, resisting and escaping.

Smashing capitalism is the classic strategy of revolution informed by the writings of Marx and extended by Lenin. According to this, capitalism seems unassailable, but is prone to periods of crisis when the system is vulnerable to rupture and the ruling class can be overthrown by a revolutionary party able to seize state power, either through elections or in an insurrection against the old regime. Once in control of the state, the party must refashion it to turn it into an instrument capable of effecting a complete break with the capitalist system. In the course of the twentieth century, this strategy was pursued in the USSR, China, Yugoslavia, Cuba etc, but whatever their other achievements, none of these states succeeded in creating a democratic, emancipatory alternative to capitalism. The verdict of history is clear: system-level rupture does not work.

Dismantling capitalism was the strategy proposed by critics of capitalism who shared the same long-run goals as the revolutionaries, but rejected the idea of rupture in favour a gradual transition to democratic socialism via top-down, state-directed reforms designed to introduce elements of socialism into the economic and social system: nationalised industries, socialised health care, public planning agencies, and so on. The critical preconditions for such a “mixed economy” were a stable electoral democracy and a broad, mass-based socialist party capable of winning elections and staying in power long enough for these structural reforms to become institutionalised. In the immediate aftermath of the Second World War, this seemed a promising strategy, but thanks to the dynamism of “golden age” capitalism and the generally poor performance of the nationalised industries, its promise faded, and after the neo-liberal counter-revolution of the 1980s and the privatisation of state-owned industries, it was effectively defunct.

Both the smashing and dismantling strategies aimed at replacing capitalism. Taming capitalism involves changing the rules of the game so as to make the system less rapacious and more benign. Some forms of regulation are best seen as protecting capitalism from its own self-destructive tendencies: for example, rules to prevent destabilising financial speculation or to conserve natural resources and amenities by means such as fishing quotas and national parks. But other forms, championed particularly by social democratic parties, introduced egalitarian, democratic and solidaristic values into the operation of capitalism: notably, social insurance to cover the most serious risks people face in their lives, especially around health, employment and income; public goods paid for through taxation such as basic and higher education; and regulation to eliminate or mitigate what economists call “negative externalities of production and consumption” such as environmental pollution.

To be sure, since 1980 these advances were rolled back as capitalism was unleashed under the combined impact of neo-liberal ideology, globalisation and the weakening of the labour movement. Nevertheless, Wright argues, the resulting constraints on the capacity of states to raise taxes, regulate markets and redistribute income have been exaggerated. The emergency fiscal and financial interventions of governments around the world to prevent economic collapse and safeguard businesses and workers during the coronavirus pandemic seems likely to mark the end of the neo-liberal era and the start of a new chapter in the shifting and contested relationship between capitalism and the state. And beyond the immediate public health crisis, the world continues to face two formidable challenges – global warming and the threat to employment posed by digitalised automation – which cannot be left to the untrammeled operation of the market without putting the whole capitalist system in jeopardy.

Varieties of anticapitalism: resisting and escaping

Taming and dismantling capitalism both require high levels of sustained collective action by cohesive organisations, especially political parties seeking to capture and exercise state power. By contrast, movements which mobilise resistance to capitalism seek to alleviate the harms of the system not by winning state power, but by means of protest and other forms of collective action designed to make it more costly for businesses and government to refuse their demands than to concede them. Examples are trade unions striking for better pay and conditions, environmentalists protesting against toxic dumps or fracking, and consumer groups organising boycotts of predatory corporations. Resistance is probably the commonest form of anticapitalism, rooted in civil society and connected to the solidarities of work and community. Its characteristic weakness is the risk that social movements preoccupied with their own specific, and often parochial, grievances or causes may degenerate into vehicles for protecting sectional interests within the capitalist system rather than seeking to transform, let alone transcend it. This phenomenon, recognised over a century ago by Lenin, who dubbed it “economism”, is familiar to students of the trade union movement.

The strategy of escaping capitalism has seldom produced a systematic anticapitalist ideology, but as Wright notes, it still has a coherent logic. Many people deplore capitalism, but believe the system is too powerful to replace, reform or even tame. The best we can do is insulate ourselves from its harms, and perhaps escape altogether into some sheltered enclave on the margins of society. Historical examples include the nineteenth-century movement to the western frontier of the US in pursuit of self-sufficient subsistence farming, utopian experiments in living differently and religious communities such as the Amish. More recent cases were the hippie counter-culture of the 1960s, the formation of workers' co-operatives in the1970s, and the emergence of local currencies, food banks, community kitchens, free clinics and social enterprises in response to gaps in public provision during periods of economic crisis. The transition towns movement meets a similar need in relation to the climate crisis. Such initiatives generally avoid political engagement and organised collective efforts to change the world. They can, nevertheless, become elements in a broader challenge to capitalism and provide the building blocks of an alternative form of economy.

Eroding capitalism

These five types of strategy are ideal-types. Actual historical anticapitalist movements have combined different types. Revolutionary communism, for example, combined resisting with smashing; democratic socialism combined resisting with dismantling; social democracy largely abandoned dismantling, but still sought to resist and tame; anarchist social movements combined resistance with attempts to build small-scale alternatives to capitalism in the form of co-operatives and mutual societies. By the end of the twentieth century, however, the first two of these four strategic configurations had largely disappeared from the political landscape in the developed capitalist countries, while social democracy was in decline, and with it the wider labour movement. This left social movements with strong anarchist leanings as the most dynamic forms of anticapitalism. Wright proposes a new configuration that combines bottom-up, civil-society-centred initiatives of resisting and escaping with a top-down, state-centred strategy of taming and dismantling. He calls it the strategy of eroding capitalism.

No economy has ever been – or ever could be – 100% capitalist. Existing systems combine capitalism with other ways of organising the production and distribution of goods and services. Some of these dispense with private ownership, but continue to produce for the market: for example, state enterprises and workers' co-operatives. Others operate wholly or partially outside the market nexus: for example, public services, household production and the diverse forms of not-for-profit caregiving, mutual support, advocacy and collaboration provided by charities and voluntary associations. The idea of eroding capitalism is that these alternatives have the potential, in the long run, to displace capitalism from its dominant role in the system.

Wright invokes two analogies to help clarify this idea. Economic systems, he argues – and, indeed, social systems in general – are better thought of as ecosystems in which loosely connected parts interact than as organisms whose tightly integrated parts serve specific functions. “The strategic vision of eroding capitalism imagines introducing the most vigorous varieties of emancipatory species of noncapitalist economic activity, nurturing their development by protecting their niches and figuring out ways of expanding their habitats.” (p61). Thus, the prospect of transforming and transcending capitalism can be compared to the stylised story of the transition from feudalism to capitalism in Europe. Through a long, meandering process of evolutionary change, extending over several centuries and punctuated by political upheavals arising from plague, famine, dynastic wars and religious schism, feudal structures ceased to dominate economic life: feudalism had been eroded.

Democratic socialism, the state and the problem of political agency

Wright admits that his strategic vision is at once enticing and far-fetched, but insists that it is not a fantasy and in the remainder of the book seeks to substantiate this claim. Having distinguished three ideal-types of economic system – capitalism, statism and socialism – he defines a socialist economy as one in which social power is dominant over both state power and economic power, noting that “fundamentally this means that socialism is equivalent to economic democracy” (p70). He refuses, however, to propose a model or blueprint for a democratic socialist economy, arguing that a model revolving around a single principle of design or institutional mechanism is unlikely to be viable and that a democratic-egalitarian economy is more likely to contain a mix of diverse forms and to evolve through experimentation and democratic deliberation. Accordingly, instead of a comprehensive scheme or programme, he outlines a “partial inventory of key building blocks.” These include an unconditional basic income, which besides enhancing personal economic security, would greatly facilitate the development of non-capitalist forms of economic activity such as worker-co-operatives and the “social and solidarity economy”. Eroding capitalism also involves the conversion of most banks into public utilities and the democratisation of capitalist firms by restricting the range of rights conferred by “ownership of the means of production” and by extending and deepening the role of employees in workplace and corporate decision-making.

Wright does not underestimate either the obstacles and resistance such structural reforms are likely to encounter or the difficulty of building active and enduring partnerships between emancipatory social movements rooted in civil society and progressive political parties capable of winning elections and forming governments. In the final two chapters of the book, he discusses the problems involved in harnessing the powers of the state for anticapitalist ends and the impediments to the creation of collective political agents with the requisite cohesion and staying power in a world of privatised lives, fragmented class structures and competing sources of identity.

Inevitably, given the author's untimely death, there are gaps in his argument. In connection with the equality/fairness principle, for example, he notes the inherent ambiguity of the word “society”. Does it mean “nation-state” or the social system formed by interdependent, interacting people variously competing and co-operating with each other? And in a globalised economy, what is the relevant “society” to which the principle applies? In the strongest version, it applies to all persons regardless of where they happen to have been born and now live. But this does not answer the practical questions of what, if anything, can and should be done to rectify injustice created by the national boundaries of citizenship.

It follows that anticapitalists need to think hard about relations between nation-states and the role that trans- and supranational institutions of governance can and should play: in resolving international disputes, preventing nuclear proliferation and combating climate change; in regulating cross-border trade, financial flows and migration; and in responding to financial panics, economic crises, humanitarian disasters and global pandemics. These are all pressing problems at a time when the system of international relations established under US hegemony after the Second World War, which survived the end of the Cold War and the collapse of communism, is being undermined by the recrudescence of great-power rivalry and the rise of national populism.

Nevertheless, while Wright's anticapitalist manifesto may not have all the answers, it offers a powerful set of tools for anyone who wants to know what is wrong with capitalism and whether there are alternatives that are not only desirable, but also viable and achievable. As with any major social thinker, the best way to honour his memory is to study his ideas and put them to work.