Who’s Confused About Capitalism?

A new Harvard poll shows 51 percent of Millennials do not support capitalism (compared to 42 percent who do). An older Reason-Rupe poll found “socialism” beat “capitalism” in popularity 58 to 56%, but the “free market” was overwhelmingly more popular than a “government-managed economy.” The spin-meisters are quick to frame this as Millennial confusion about what capitalism and socialism are. But it arguably reflects, rather, the obsolescence of the old definitions of “capitalism” and “socialism” themselves. For that matter, the conventional definitions used in the 20th century never made much sense.

Max Ehrenfreund, throughout the Washington Post article that reported on the poll (“A majority of millennials now reject capitalism, poll shows,” April 26), uses “free market” interchangeably with both “capitalism” and “the status quo.” Applying the basic principles of deductive logic, this means that the status quo is a free market — a conclusion so absurd as to suggest Ehrenfreund’s own confusion more than anybody else’s. He quotes an older 2011 Pew survey that similarly used “capitalism” as a synonym for “America’s free market system.”

John Della Volpe, the Harvard polling director responsible for the most recent findings, argued that “They’re not rejecting the concept. The way in which capitalism is practiced today, in the minds of young people — that’s what they’re rejecting.”

The problem is that people like Ehrenfreund, the Pew researchers and virtually all TV talking heads and mainstream politicians of both major parties explicitly use the term “free market system” to refer to what we have right now.

The other problem is that there’s never been a form of capitalism in practice that wasn’t at least as coercive and statist as what we have right now. Historical capitalism began five or six centuries ago, not with free markets, but with the conquest of the free towns by the absolute states and the mass expropriation of peasants from their traditional rights to the land by the landed oligarchy, and continued with the colonial conquest of most of the world outside Europe. Since then capital has continued to rely heavily on the state to socialize its operating costs, erect barriers to competition, and enforce illegitimate title to all the land and natural resources engrossed in previous centuries. This history of conquest, robbery and enslavement is in the basic genetic code of contemporary corporate capitalism.

At Reason (“Millennials Hate Capitalism Almost as Much as They Hate Socialism,” April 27), Elizabeth Nolan Brown recognized that what Millennials mean by “capitalism” isn’t some hypothetical “free market”:

Capitalism is Big Banks, Wall Street, “income inequality,” greed. It’s wealthy sociopaths screwing over the little guy, Bernie Madoff, and horrifying sweatshops in China. It’s Walmart putting mom-and-pop stores out of business, McDonald’s making people fat, BP oil spills, banks pushing sub-prime mortgages, and Pfizer driving up drug prices while cancer patients die. However incomplete or caricatured, these are the narratives of capitalism that millennials have grown up with.

But then, when you subtract all these aspects of contemporary capitalism, you’re left with something a lot like the Cheshire Cat when both the cat and the grin have disappeared.

In any case Brown does a lot better than Emily Ekins, who reported on the Reason-Rupe poll a year ago. Ekins simply reasserted the conventional dictionary definitions of “socialism” and “capitalism” as a matter of dogma, suggesting that the fact Millennials like socialism but don’t want a “government-managed economy” simply meant “young people don’t know what these words mean” (“Poll: Americans Like Free Markets More than Capitalism and Socialism More Than a Govt Managed Economy,” Feb. 12, 2015). And in another article (“64 Percent of Millennials Favor a Free Market Over a Government-Managed Economy,” Reason, July 10, 2014), she cited Millennial inability to “define socialism as government ownership” as a sign of ignorance of “what socialism means.”

But “capitalism” and “socialism” are terms with long, nuanced histories, and the conventional dictionary definitions are — at best — extremely time- and perspective-bound. And treating the dictionary definition of “socialism” as though it trumped the actual history of the socialist movement is — if you’ll excuse me — the very definition of “dumb.”

There have always been non-statist strands within the socialist movement, since its very beginning — one of them is known as “anarchism.” At times the non-statist forms of socialism were dominant. And there have always been self-identified socialists within the free market libertarian movement.

Even state socialists like Marx and Engels, who saw socialist control of the state as an essential step towards building socialism, didn’t equate “socialism” to state ownership and control of the economy as such. “Socialism” was a system in which all political and economic power was in the hands of the working class. Nationalization and state control of the economy might be part of the transition process to socialism — if the state came under working class control. On the other hand, increasing state control of the economy when the state was controlled by capitalists would simply be a new stage in the evolution of capitalism in which the capitalists managed the system through the state in their own interest.

Today the most interesting subcurrents in the socialist movement are those like the autonomism of Antonio Negri and Michael Hardt, which sees the path to post-capitalism as “Exodus” — the creation of a new society around counter-institutions like commons-based peer production.

Erik Olin Wright, for example (“How to Think About (And Win) Socialism,” Jacobin, April 2016), sees “socialism” as a system in which democratically organized social forces — as opposed to either states or corporations — are the dominant means of organizing activity. Societies throughout history have been a mixture of such institutional forms — but under capitalism the for-profit business firm became the hegemonic institution, or kernel of the entire society, with other institutions defined by their relations to capital. As capitalism evolves into socialism, new democratic social institutions will become the hegemonic form, and the state and business will be reduced to niches in a system characterized by the dominance of the new democratic institutions.

Things like local currencies, land trusts, cooperatives and commons-based peer production exist under capitalism today. But as capitalism reaches the limits of growth and confronts its terminal crises, these new socialist institutions will expand and knit together into a coherent whole that will form the basis of the successor system, and the remains of corporate and state institutions will be integrated into a system defined by its post-capitalist core.

…the possibility of socialism depends on the potential to enlarge and deepen the socialist component within the overall economic ecosystem and weaken the capitalist and statist components. This would mean that in a socialist economy, the exercise of both economic power and [state] power would be effectively subordinated to social power; that is, both the state and economy would be democratized. This is why socialism is equivalent to the radical democratization of society.

And something like this, by the way — a vision of transformation based on prefigurative politics and counter-institution building — has been at the heart of many versions of socialism and anarchism since their first appearance as organized movements two hundred years ago.

So maybe when Millennials say they hate capitalism and like socialism, but oppose state control of the economy, it’s not they who are confused. Maybe they have a better idea of what “capitalism” and “socialism” mean than people like Frauenfelder and Ekins.