Thursday, September 29, 2011

Capitalism seeds: just add water!

Capitalism--as a concept--is tossed around constantly by people in the public eye, by people in cyberspace, and by people just going about their day to day lives. And when used, it's almost always with regard to a contentious issue of some sort. Unfortunately, most people using the term really don't have a a full grasp of what it actually means, what it actually is.

Capitalism is not an ideology, it's is not the opposite of socialism, or communism, or Marxism. It's not a descriptor for a government and calling one self a "capitalist" is usually a meaningless statement. Simply put, capitalism is using wealth as capital to create more wealth.

But to understand what something is is to understand how it works, a postulate that is universally true, in my opinion. And this is even more true of capitalism, proper, because capitalism is a process, above all else. In a way, it is very much like evolution. Both occur--as processes--naturally with no need of someone dictating what must be done or what must happen (Adam Smith's "invisible hand") . Yet, both need a basic framework, a reality, in which to occur.

Evolution, of course, has the ecosystem of the Earth and it has the fundamental laws governing matter and energy. Setting aside the potential involvement of any deity in establishing this reality, evolution occurs on its own.

Capitalism has the economy of mankind's society at large, something that is impacted constantly by changes in the nature of various subsets of this society. And, in fact, historically we know that capitalism began to occur in its most significant scale in the societies of Nothern Europe--England and Holland in particular--and in North America, following the migration of such Europeans to the New World.

And capitalism also has the rules--the laws--governing the economies of the many subsets of society at large. Some of these rules are more conducive to capitalism and thus the genesis of the process in specific places at specific times.

Capitalism has consequences, the biggest one being a necessary unequal distribution of wealth and resources. As capitalism became more and more prevalent, this did not go unnoticed (never mind the habitual inequality in wealth and resources that has characterized all of history). And many thinkers sought to explain how this problem could be fixed. Marx, for one, was very much opposed to capitalism and its results. These days, many are quick to dismiss Marx and Marxism, but make no mistake, he very much understood the "how" of the process. And that's something that cannot be said of most, today.

All that said, why capitalism? Where did it come from? There is a great--in my opinion--book on capitalism's roots by Michael Perelman: The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation. It's those last two words in the title that most concern us, here.

Primitive accumulation--Marx's term (Smith identified a similar concept: original accumulation)--refers to the process through which workers are separated from their own means of production and wedded to the means of production of others (capitalists) as wage-earners. It is--in effect--the fundamental event that ushers in capitalism.

Perelman, in his book, actually traces this process in England, as the localized, sedentary, self-provisioning population have their options methodically limited--via legal mechanisms like Game Laws--until they cannot help but seek employment from others, until they must participate more and more in the burgeoning consumer economy.

Now, I think Marx and Perelman are very much on target, here. But two things need to be understood: 1) there was no secret cabal orchestrating these changes; they were a natural by-product of development and a very novel view of property rights and 2) the end result is not great tragedy; people idealize the past, but the standards of living enjoyed today--because of capitalism--make the past pale in comparison.

Of course, there is a great deal of speculation in all of this: no one alive today actually witnessed all of this unfolding. And of those that did, none could really grasp the totality of the situation.

However, we may have available--right now--a real-world example of primitive accumulation occurring with an actual limiting of self-provisioning accompanying it: India.

Currently, there is a major dispute in India over the practices of Monsanto, with regard to genetically modified eggplant. Monsanto's attempt to introduce GM seeds into India--if successful--will ultimately force local farmers to go to an outside source for their seeds. Over time, this will surely turn into an advantage for the larger farms, ultimately reducing--by far--the number of independent farmers. That's primitive accumulation, as theorized by Marx. And it appears to happening right now.

Can I get a grant for a case study?

Cheers, all.

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