Capitalism in the Real World

Capitalism is a hierarchical accumulative system where all available means are used to accumulate capital and concentrate it. The state evolved alongside capitalism and the pioneers of capitalism voluntarily used state institutions like central banks and state-sponsored companies. Both the Netherlands and England created central banks and East India Companies even before the industrial revolution got into high gear. Capitalism from its onset was embedded in a mercantilist model where rich elites invested in merchant sailors who extracted wealth both from Asia and the New World. During this period colossal amounts of gold and silver from Mexico and Peru came on ships, temporarily made Spain wealthy and then bankers in the Netherlands and England. The mercantilist model of a given country, Netherlands or England, exporting more goods than they imported meant the trade surplusses translated into gold or silver. This model of actual capitalism is based on the voluntary exploitation by mercantilists of Asian and American lands and slaves laboring on sugar plantations, gold and silver mines in the Americas.

Bankers were always integral to capitalism and consolidating their power via central banks or forming family networks like the Rothschild dynasty is a capitalistic mechanism. Before the “evil” Federal Reserve there were moguls like J P Morgan who essentially bailed out the U.S. banking system from the Panic of 1907 and thus made the notion of a central bank appealing. The U.S. federal government was a mere 5% of the GDP in the late 1800’s and a handful of ultrawealthy moguls voluntarily called the shots and owned elected officials. I am sure the factory workers and children working in mines in horrific conditions would have enjoyed a discussion of the voluntary aspects of capitalism or the “free market”, just as abused exploited workers in Bangladesh or Vietnam making cheap clothes or shoes you buy at The Gap or Old Navy would like to talk about “voluntary” aspects of corporations running their states and having global sovereignty over states.

Capitalism today is embedded via its natural evolution in corporations, efficient machines of capital extraction and accumulation from Asians and Latin Americans making Iphones, shoes, clothes, cheap stuff you buy. The voluntary aspect of transnational corporate capitalism is one-sided and hierarchical. The higher you are on the capitalism hierarchy the more voluntary options you have to make wealth. When you are a kid in Bangladesh making clothes in a factory liable to collapse, your participation is not very voluntary. if you are a cocoa slave in the Ivory Coast, you are being involuntarily used for the shareholders of a candy company, its management, and the person in the 1st world enjoying the chocolate made affordable by slave labor.