kyliaquilor - Tumblr blog

kyliaquilor · 2 days

Text

Podcasting “Capitalists Hate Capitalism”

I'm touring my new, nationally bestselling novel The Bezzle! Catch me in Torino (Apr 21) Marin County (Apr 27), Winnipeg (May 2), Calgary (May 3), Vancouver (May 4), and beyond!

This week on my podcast, I read "Capitalists Hate Capitalism," my latest column for Locus Magazine:

https://locusmag.com/2024/03/cory-doctorow-capitalists-hate-capitalism/

What do I mean by "capitalists hate capitalism?" It all comes down to the difference between "profits" and "rents." A capitalist takes capital (money, or the things you can buy with it) and combines it with employees' labor, and generates profits (the capitalist's share) and wages (the workers' share).

Rents, meanwhile, come from owning an asset that capitalists need to generate profits. For example, a landlord who rents a storefront to a coffee shop extracts rent from the capitalist who owns the coffee shop. Meanwhile, the capitalist who owns the cafe extracts profits from the baristas' labor.

Capitalists' founding philosophers like Adam Smith hated rents. Worse: rents were the most important source of income at the time of capitalism's founding. Feudal lords owned great swathes of land, and there were armies of serfs who were bound to that land – it was illegal for them to leave it. The serfs owed rent to lords, and so they worked the land in order grow crops and raise livestock that they handed over the to lord as rent for the land they weren't allowed to leave.

Capitalists, meanwhile, wanted to turn that land into grazing territory for sheep as a source of wool for the "dark, Satanic mills" of the industrial revolution. They wanted the serfs to be kicked off their land so that they would become "free labor" that could be hired to work in those factories.

For the founders of capitalism, a "free market" wasn't free from regulation, it was free from rents, and "free labor" came from workers who were free to leave the estates where they were born – but also free to starve unless they took a job with the capitalists.

For capitalism's philosophers, free markets and free labor weren't just a source of profits, they were also a source of virtue. Capitalists – unlike lords – had to worry about competition from one another. They had to make better goods at lower prices, lest their customers take their business elsewhere; and they had to offer higher pay and better conditions, lest their "free labor" take a job elsewhere.

This means that capitalists are haunted by the fear of losing everything, and that fear acts as a goad, driving them to find ways to make everything better for everyone: better, cheaper products that benefit shoppers; and better-paid, safer jobs that benefit workers. For Smith, capitalism is alchemy, a philosopher's stone that transforms the base metal of greed into the gold of public spiritedness.

By contrast, rentiers are insulated from competition. Their workers are bound to the land, and must toil to pay the rent no matter whether they are treated well or abused. The rent rolls in reliably, without the lord having to invest in new, better ways to bring in the harvest. It's a good life (for the lord).

Think of that coffee-shop again: if a better cafe opens across the street, the owner can lose it all, as their customers and workers switch allegiance. But for the landlord, the failure of his capitalist tenant is a feature, not a bug. Once the cafe goes bust, the landlord gets a newly vacant storefront on the same block as the hot new coffee shop that can be rented out at even higher rates to another capitalist who tries his luck.

The industrial revolution wasn't just the triumph of automation over craft processes, nor the triumph of factory owners over weavers. It was also the triumph of profits over rents. The transformation of hereditary estates worked by serfs into part of the supply chain for textile mills was attended by – and contributed to – the political ascendancy of capitalists over rentiers.

Now, obviously, capitalism didn't end rents – just as feudalism didn't require the total absence of profits. Under feudalism, capitalists still extracted profits from capital and labor; and under capitalism, rentiers still extracted rents from assets that capitalists and workers paid them to use.

The difference comes in the way that conflicts between profits and rents were resolved. Feudalism is a system where rents triumph over profits, and capitalism is a system where profits triumph over rents.

It's conflict that tells you what really matters. You love your family, but they drive you crazy. If you side with your family over your friends – even when your friends might be right and your family's probably wrong – then you value your family more than your friends. That doesn't mean you don't value your friends – it means that you value them less than your family.

Conflict is a reliable way to know whether or not you're a leftist. As Steven Brust says, the way to distinguish a leftist is to ask "What's more important, human rights, or property rights?" If you answer "Property rights are human right," you're not a leftist. Leftists don't necessarily oppose all property rights – they just think they're less important than human rights.

Think of conflicts between property rights and human rights: the grocer who deliberately renders leftover food inedible before putting it in the dumpster to ensure that hungry people can't eat it, or the landlord who keeps an apartment empty while a homeless person freezes to death on its doorstep. You don't have to say "No one can own food or a home" to say, "in these cases, property rights are interfering with human rights, so they should be overridden." For leftists property rights can be a means to human rights (like revolutionary land reformers who give peasants title to the lands they work), but where property rights interfere with human rights, they are set aside.

In his 2023 book Technofeudalism, Yanis Varoufakis claims that capitalism has given way to a new feudalism – that capitalism was a transitional phase between feudalism…and feudalism:

https://pluralistic.net/2023/09/28/cloudalists/#cloud-capital

Varoufakis's point isn't that capitalists have gone extinct. Rather, it's that today, conflicts between capital and assets – between rents and profits – reliably end with a victory of rent over profit.

Think of Amazon: the "everything store" appears to be a vast bazaar, a flea-market whose stalls are all operated by independent capitalists who decide what to sell, how to price it, and then compete to tempt shoppers. In reality, though, the whole system is owned by a single feudalist, who extracts 51% from every dollar those merchants take in, and decides who can sell, and what they can sell, and at what price, and whether anyone can even see it:

https://pluralistic.net/2024/03/01/managerial-discretion/#junk-fees

Or consider the patent trolls of the Eastern District of Texas. These "companies" are invisible and produce nothing. They consist solely of a serviced mailbox in a dusty, uninhabited office-building, and an overbroad patent (say, a patent on "tapping on a screen with your finger") issued by the US Patent and Trademark Office. These companies extract hundreds of millions of dollars from Apple, Google, Samsung for violating these patents. In other words, the government steps in and takes vast profits generated through productive activity by companies that make phones, and turns that money over as rent paid to unproductive companies whose sole "product" is lawsuits. It's the triumph of rent over profit.

Capitalists hate capitalism. All capitalists would rather extract rents than profits, because rents are insulated from competition. The merchants who sell on Jeff Bezos's Amazon (or open a cafe in a landlord's storefront, or license a foolish smartphone patent) bear all the risk. The landlords – of Amazon, the storefront, or the patent – get paid whether or not that risk pays off.

This is why Google, Apple and Samsung also have vast digital estates that they rent out to capitalists – everything from app stores to patent portfolios. They would much rather be in the business of renting things out to capitalists than competing with capitalists.

Hence that famous Adam Smith quote: "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." This is literally what Google and Meta do:

https://en.wikipedia.org/wiki/Jedi_Blue

And it's what Apple and Google do:

https://www.theverge.com/2023/10/27/23934961/google-antitrust-trial-defaults-search-deal-26-3-billion

Why compete with one another when you can collude, like feudal lords with adjacent estates who trust one another to return any serf they catch trying to sneak away in the dead of night?

Because of course, it's not just "free markets" that have been captured by rents ("Competition is for losers" -P. Thiel) – it's also "free labor." For years, the largest tech and entertainment companies in America illegally colluded on a "no poach" agreement not to hire one-anothers' employees:

https://techcrunch.com/2015/09/03/apple-google-other-silicon-valley-tech-giants-ordered-to-pay-415m-in-no-poaching-suit/

These companies were bitter competitors – as were these sectors. Even as Big Content was lobbying for farcical copyright law expansions and vowing to capture Big Tech, all these companies on both sides were able to set aside their differences and collude to bind their free workers to their estates and end the "wasteful competition" to secure their labor.

Of course, this is even more pronounced at the bottom of the labor market, where noncompete "agreements" are the norm. The median American worker bound by a noncompete is a fast-food worker whose employer can wield the power of the state to prevent that worker from leaving behind the Wendy's cash-register to make $0.25/hour more at the McDonald's fry trap across the street:

https://pluralistic.net/2022/02/02/its-the-economy-stupid/#neofeudal

Employers defend this as necessary to secure their investment in training their workers and to ensure the integrity of their trade secrets. But why should their investments be protected? Capitalism is about risk, and the fear that accompanies risk – fear that drives capitalists to innovate, which creates the public benefit that is the moral justification for capitalism.

Capitalists hate capitalism. They don't want free labor – they want labor bound to the land. Capitalists benefit from free labor: if you have a better company, you can tempt away the best workers and cause your inferior rival to fail. But feudalists benefit from un-free labor, from tricks like "bondage fees" that force workers to pay in order to quit their jobs:

https://pluralistic.net/2023/04/21/bondage-fees/#doorman-building

Companies like Petsmart use "training repayment agreement provisions" (TRAPs) to keep low-waged workers from leaving for better employers. Petsmart says it costs $5,500 to train a pet-groomer, and if that worker is fired, laid off, or quits less than two years, they have to pay that amount to Petsmart:

https://pluralistic.net/2022/08/04/its-a-trap/#a-little-on-the-nose

Now, Petsmart is full of shit here. The "four-week training course" Petsmart claims is worth $5,500 actually only lasts for three weeks. What's more, the "training" consists of sweeping the floor and doing other low-level chores for three weeks, without pay.

But even if Petsmart were to give $5,500 worth of training to every pet-groomer, this would still be bullshit. Why should the worker bear the risk of Petsmart making a bad investment in their training? Under capitalism, risks justify rewards. Petsmart's argument for charging $50 to groom your dog and paying the groomer $15 for the job is that they took $35 worth of risk. But some of that risk is being borne by the worker – they're the ones footing the bill for the training.

For Petsmart – as for all feudalists – a worker (with all the attendant risks) can be turned into an asset, something that isn't subject to competition. Petsmart doesn't have to retain workers through superior pay and conditions – they can use the state's contract-enforcement mechanism instead.

Capitalists hate capitalism, but they love feudalism. Sure, they dress this up by claiming that governmental de-risking spurs investment: "Who would pay to train a pet-groomer if that worker could walk out the next day and shave dogs for some competing shop?"

But this is obvious nonsense. Think of Silicon Valley: high tech is the most "IP-intensive" of all industries, the sector that has had to compete most fiercely for skilled labor. And yet, Silicon Valley is in California, where noncompetes are illegal. Every single successful Silicon Valley company has thrived in an environment in which their skilled workers can walk out the door at any time and take a job with a rival company.

There's no indication that the risk of free labor prevents investment. Think of AI, the biggest investment bubble in human history. All the major AI companies are in jurisdictions where noncompetes are illegal. Anthropic – OpenAI's most serious competitor – was founded by a sister/brother team who quit senior roles at OpenAI and founded a direct competitor. No one can claim with a straight face that OpenAI is now unable to raise capital on favorable terms.

What's more, when OpenAI founder Sam Altman was forced out by his board, Microsoft offered to hire him – and 700 other OpenAI personnel – to found an OpenAI competitor. When Altman returned to the company, Microsoft invested more money in OpenAI, despite their intimate understanding that anyone could hire away the company's founder and all of its top technical staff at any time.

The idea that the departure of the Burger King trade secrets locked up in its workers' heads constitute more of a risk to the ability to operate a hamburger restaurant than the departure of the entire technical staff of OpenAI is obvious nonsense. Noncompetes aren't a way to make it possible to run a business – they're a way to make it easy to run a business, by eliminating competition and pushing the risk onto employees.

Because capitalists hate capitalism. And who can blame them? Who wouldn't prefer a life with less risk to one where you have to constantly look over your shoulder for competitors who've found a way to make a superior offer to your customers and workers?

This is why businesses are so excited about securing "IP" – that is, a government-backed right to control your workers, customers, competitors or critics:

https://locusmag.com/2020/09/cory-doctorow-ip/

The argument for every IP right expansion is the same: "Who would invest in creating something new without the assurance that someone else wouldn’t copy and improve on it and put them out of business?"

That was the argument raised five years ago, during the (mercifully brief) mania for genre writers seeking trademarks on common tropes. There was the romance writer who got a trademark on the word "cocky" in book titles:

https://www.theverge.com/2018/7/16/17566276/cockygate-amazon-kindle-unlimited-algorithm-self-published-romance-novel-cabal

And the fantasy writer who wanted a trademark on "dragon slayer" in fantasy novel titles:

https://memex.craphound.com/2018/06/14/son-of-cocky-a-writer-is-trying-to-trademark-dragon-slayer-for-fantasy-novels/

Who subsequently sought a trademark on any book cover featuring a person holding a weapon:

https://memex.craphound.com/2018/07/19/trademark-troll-who-claims-to-own-dragon-slayer-now-wants-exclusive-rights-to-book-covers-where-someone-is-holding-a-weapon/

For these would-be rentiers, the logic was the same: "Why would I write a book about a dragon-slayer if I could lose readers to someone else who writes a book about dragon-slayers?"

In these cases, the USPTO denied or rescinded its trademarks. Profits triumphed over rents. But increasingly, rents are triumphing over profits, and rent-extraction is celebrated as "smart business," while profits are for suckers, only slightly preferable to "wages" (the worst way to get paid under both capitalism and feudalism).

That's what's behind all the talk about "passive income" – that's just a euphemism for "rent." It's what Douglas Rushkoff is referring to in Survival of the Richest when he talks about the wealthy wanting to "go meta":

https://pluralistic.net/2022/09/13/collapse-porn/#collapse-porn

Don't drive a cab – go meta and buy a medallion. Don't buy a medallion, go meta and found Uber. Don't found Uber, go meta and invest in Uber. Don't invest in Uber, go meta and buy options on Uber stock. Don't buy Uber stock options, go meta and buy derivatives of options on Uber stock.

"Going meta" means distancing yourself from capitalism – from income derived from profits, from competition, from risk – and cozying up to feudalism.

Capitalists have always hated capitalism. The owners of the dark Satanic mills wanted peasants turned off the land and converted into "free labor" – but they also kidnapped Napoleonic war-orphans and indentured them to ten-year terms of service, which was all you could get out of a child's body before it was ruined for further work:

https://pluralistic.net/2023/09/26/enochs-hammer/#thats-fronkonsteen

When Varoufakis says we've entered a new feudal age, he doesn't mean that we've abolished capitalism. He means that – for the first time in centuries – when rents go to war against profits – the rents almost always emerge victorious.

Here's the podcast episode:

https://craphound.com/news/2024/04/14/capitalists-hate-capitalism/

Here's a direct link to the MP3 (hosting courtesy of the Internet Archive; they'll host your stuff for free, forever):

https://archive.org/download/Cory_Doctorow_Podcast_465/Cory_Doctorow_Podcast_465_-_Capitalists_Hate_Capitalism.mp3

And here's the RSS feed for my podcast:

http://feeds.feedburner.com/doctorow_podcast

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2024/04/18/in-extremis-veritas/#the-winnah

#I don't think all of this is fair but #I mean yeah #Late Stage Capitalism #is now apparently #Early Stage Neofeudalism

1K notes · View notes

kyliaquilor · 13 days

Note

Just curious, why do you think Rome fell?

OMG do you really have to ask such a big question right before I was going to bed anon? Well, here are the primary reasons IMO as a Roman history buff.

Lots of Civil Wars --- The Romans going way back to the days of the Republic were constantly fighting over who was going to be boss. Sulla fought a civil war and took over Rome and declared himself dictator, ditto Julius Caesar, and of course Octavian did the same and became the first emperor. During the empire there were many civil wars over who would be emperor as the Imperial system often lacked rules for succession resulting in dynastic struggles and civil wars. Not that it would have mattered if they did, as they probably would have just ignored the rules. In the 3rd century the empire underwent a 50 year period of near constant civil war known as the Crises of the Third Century. Constantine became emperor after killing all his opponents in a civil war. The later half of the 4th century had more civil wars. Even in the 5th century factions were fighting each for control of an empire that was collapsing all around them. No side wins a civil war because they are bloody, destructive, there are no spoils of war. There is only self destruction, they are about as helpful to a country as would a person shooting himself in the foot. All the money and resources that went into fighting civil wars and rebuilding after the war was money and resources not being used to maintain infrastructure, maintain public works, regulate the economy, defend from outside threats, and maintain the government.

2. Political Instability --- Most emperors did not die of natural causes, most emperors were murdered, or committed suicide, or died in battle, or died in a prison cell. Roman government was chalk full of power hungry psychopaths who were willing to murder their way to the top. Sometimes emperors could come and go quickly, with reigns lasting 2-3 years or less in the 3rd century.

youtube

Roman political history was rife with intrigue, assassinations, and coups occurring all the time. It was like Game of Thrones except instead of lasting 8 seasons it lasted 500 years.

3. The Army Became a Powerful Interest Group --- If you were a Roman emperor the army was a double edged sword. They were good in that they maintained peace and order in the empire and protected it from invaders. They were bad for you in that they could revolt and murder you, replacing you with someone they liked more. Even your own guard, the Praetorian Guards, couldn't be trusted as they could easily slit your throat in your sleep and declare someone else as emperor. To make sure the army was happy, you gave them big pay bonuses called donatives. Basically official bribes paid to keep the soldiers of the army loyal and happy. With each successive emperor the annual donative became bigger and bigger and thus a greater strain on the Imperial Treasury. If an emperor didn't pay up, he could be murdered by his own soldiers. Thus a lot of public money was paid just to keep the army happy so they didn't end up starting another civil war.

4. A Fucked up Economy --- Maintaining a large standing army to defend a large empire is expensive. Fighting civil wars is expensive. Rebuilding after civil wars is expensive. Constant regime change is expensive. Political intrigue is expensive. Eventually it got to the point where there just wasn't enough money to pay for all that. So emperors just minted more money, decreasing the silver content and minting more copper coins until eventually Roman money became worthless.

Today Roman money is still worthless. Go on ebay and find the cheapest Roman coins you can buy. Except for rarer collectibles Roman coins are still very plentiful and thus very cheap to collect. Worthless money made trade and commerce difficult, and thus the economy suffered. Not to mention constant bloody and destructive civil wars were damaging the economy. Political instability also damaged the economy.

5. Growing Disparity in Wealth --- Over time with civil wars and political instability the rich got richer and the poor got poorer. Eventually wealth became so concentrated in the upper class that the middle class disappeared entirely by the late 4th - 5th century. By then the average Roman was in a bad way. They had no opportunities and most Romans were forced to live as tenant farmers, essentially sharecroppers.

6. A Corrupt Tax System --- Meanwhile the wealthy became so powerful that they were able to wield that power so that they did not have to pay taxes. They could exploit loopholes, manipulate laws in their favor, or bribe their way out of paying. To try to make up the revenue, tax collectors attempted to squeeze the lower classes, which of course, didn't have any money. Thus by the late 4th - 5th century the empire was severely underfunded. This resulted in the degradation of infrastructure, public works, the army, the weakening of the government, and less investment in the economy and commerce.

7. Patronage --- By the 5th century the average Roman was out of opportunities and the middle class was gone entirely. More and more the lower class Roman was being squeezed for tax money, money which they didn't have. So in order to survive, Roman lower classes sold their services to a wealthy patron. The patron would house you and protect you and take care of your tax problems. If you were lucky and had special skills like a craftsman or artist you could make a good living under a patron. If not, you probably ended up a tenant farmer tied to the land of the patron, essentially a sharecropper, a serf, or a peasant. Due to this change in the socio economic system power was drawn away from the Imperial government and was redirected to the wealthy patrons. Thus the empire was becoming decentralized.

This would become the basis for medieval feudalism.

8. No One Wanted to Join the Army --- Why would you? You're dirt poor and have no opportunities. If you joined the army you may not even get the opportunity to defend the empire, as you're gonna get killed in a stupid civil war fighting a fellow Roman who is also dirt poor and has no opportunities. Your government is corrupt, your emperor is a snobbish entitled incompetent dipshit who was out of touch with reality, the tax man is trying to squeeze you for money you don't have, you have no rights, you've been forced to become a peasant to a proto-feudal lord, and it is clear the empire is dying. By the mid 5th century most Romans were like, "let it fucking die". As a result, the army suffered severe manpower shortages. Right at the time when Goths and Franks and Vandals and Huns are going to start swarming into the empire.

These to me are the primary reasons for the fall. Anyone have anything else to add in addition to this?

#Can't disagree #Like yes the Barbarians were the murder weapon but the Empire was sick and dying well before then #Maybe no barbarians the Empire is able to fix itself #The Crisis of the Third Century was this reinforcing cycle of barbarians - civil war that kept making each problem worse in a lot of ways #if the Barbarians hadn't been a significant factor hadn't gotten more organized and better trained etc etc then maybe the Empire would have #had the time to resolve it's issues but maybe it still would have fallen just not in the same way #The Antonine and Cyprian Plagues didn't help either of course #Christianity arguably added disunity when the Empire didn't need it though it's not like Christianity was the sole factor #the list of reasons is huge and it all comes down to which you think is the most important #I think political instability is the biggest but I would argue that's because several of the points above all fall under that same header o #maybe you could call it a 'crisis of legitimacy' because later Medieval Europe rarely had the same thing for a long time anyway - they #managed monarchy better than rome #History #Roman History

302 notes · View notes