Double click or tap any English word in this post to open its definition in a new window (external).
4 for Now
In the United States, supporting capitalism is tantamount to patriotism. But do most people know—beyond a vague idea—what capitalism really is?
By definition, capitalism is an economic system where goods are owned privately or by corporations, investments are made by private decision, and cost, supply, and demand are determined by competition in a free market.
Sounds benign, even boring.
Practically, this means in pure capitalism, everything from food and furniture to schools and healthcare is determined by the individuals or corporations that run them, rather than the government. Which means they can charge you whatever they’d like (fair price or not) because there’s no regulation. (Think: the outrageous cost of insulin. Which yes, costs a heck of a lot more than water.)
It means that access to goods and services can be controlled based on whether the owner wishes you to have access. And that the work needed to provide said goods and services need not provide a living wage.
Capitalism is zero-sum: for someone to win, someone else has to lose. And in the U.S., it’s the richest 1%—the owners and corporations—who win while the rest of us lose.
Why did the U.S. adopt capitalism in the first place?
I’m so glad you asked.
When feudalism in Europe died, formerly land-tied peasants moved to city centers and started selling their labor to survive. As the Industrial Age set in, trading labor (and time) for money persisted in factories and mills.
When Europeans settled in the American colonies, this practice continued through slavery, which benefited slave owners even more than traditional capitalism because 1) they were getting the work without having to trade any money for it, and 2) the enslaved people themselves were used as actual capital. And thus the rich got even richer.
Slavery may seem like an extreme example, but consider prison labor (paying an average of 86¢ per hour) and minimum wage jobs (paying $7.25 per hour). If you’re not getting paid enough to survive, you’re being exploited.
But what about smaller businesses? Well, sure, that’s great. And it’s heartwarming to see an hard-working individual or group start up their own business … until the big corporations come in with their competitive pricing (since they’re exploiting workers) and force the little guys to close.
I could go on, but to keep this under four minutes, let me close with a quote from economist Umair Haque, which may help explain what we’re witnessing in the U.S. now:
“What does a society in which people are quite literally selling the inviolable, whether their rights, bodies, futures, or families, to feed predatory capitalism look like? Well, it cannot really be a democracy, because its most fundamental principle — that a people’s rights cannot be sold out from under them, that some are inalienable — no longer exists. It is likely to be a genuinely brutal and horrifying place to be, one where such things as decency, humanity, and trust simply cannot flourish at all.”
4 for Later
- On Merriam-Webster’s page for “capitalism,” they have more information on capitalism vs. socialism. (Scroll down past the definition. 5-minute read)
- What ‘Capitalism’ Is and How It Affects People by Kim Kelly (12-minute read)
- Dr. Julianne Malveaux touches upon slavery as predatory capitalism in this video (7 minutes) and the use of convict labor in this article (5-6 minutes).
- Full article from Umair Haque: How Predatory Capitalism Ate America From the Inside Out (7-minute read). Link is to tweet with article link. (This bypasses the paywall on Medium.)