In previous posts (yeah, from a year or two ago…but that’s still previous!), I’ve used – without explanation – the term “capitalism” when trying to think through the position of handmade bike builders and the bike industry more broadly and I’d like to circle back to that a bit in this post and ones to follow. Here I’ll try to quickly set the stage by getting to what I believe is a key distinction to be drawn here: that is, between “capitalism” and “markets”.
There’s a lot of talk these days about capitalism – at least, a lot more than there used to be not all that long ago. Use of the term “capitalism” has come and gone over the years, usually used by radical/critical folks as part of a critique, but other times triumphantly by various kinds of right/pro-systemic analysts. What’s interesting to me in the current – let’s say, post-2008/Great Recession – moment is the extent to which “capitalism” is used in mainstream popular discourse and debate, and the extent to which variants of “can capitalism survive?” are discussed in the more popular press and by students. Interesting times for sure, and this has become – I think – an important question for people interested in the shifting scales of production and those trying to make a living in the craft/artisan/maker economy.
As a theoretical and conceptual starting point, I’d like to pick up on what may seem at first glance like an obvious (non)distinction: that between “capitalism” or a “capitalist economy” and that of “markets” or “the market”. What I hear a lot in everyday life is people using the terms almost interchangeably. In the conventional wisdom, capitalism is an economic system organized around markets. From this perspective, the logic of the market is the logic of capitalism, and if you got rid of markets, “regulated” them too much or otherwise pulled them away from being “free”….well, then you wouldn’t have capitalism. And because – again, in the conventional wisdom – markets are seen as a natural, trans-historical “fact” of human existence and an outgrowth of human nature, capitalism itself (again, defined almost tautologically/axiomatically as a system of markets or with markets at the center) is taken to be a basic social fact, or inevitable and “natural” outcome of social relations…for better or for worse.
But, there are other ways to think about this. One such approach follows the influential work of historian Fernand Braudel and his attempt to write essentially a (three volume) world history of capitalism as an historical social system over the run of multiple centuries. In Braudel’s view, socio-economic life is comprised of distinctive “layers” that rest upon each other, even if in practice, and in the relatively short-run of years and decades, the boundaries between which cannot be decisively and cleanly distinguished (to paraphrase Braudel, these are not layers like oil on water). The basis of socio-economic life for Braudel is the lowest layer, what he calls “material life”, and by which he denotes the basic set of technologies, knowledges, customs and organizations through which humans (households, societies) make a living and build a civilization.
Braudel’s next two layers are where things get interesting in terms of “markets” and “capitalism”, because Braudel here turns the conventional wisdom (of markets=capitalism) on its head. For Braudel, the market layer of socio-economic life (his “market life”) actually operates by the inverse logic of “capitalism”. Braudel sees market life as the sphere of production and direct exchange, with transparent transactions and direct competition amongst (small-scale) producers who are fundamentally pursuing “livelihood”. Market life in the Braudelian framework is thus “free” in the conventional sense of “competitive” but, at the same time, it is a socio-economic layer of low profit, high competition and participants pursuing a livelihood rather than profit maximization. Capitalism – Braudel’s shady and non-transparent third socio-economic layer – takes advantage of markets and market life, but through a different logic: that of profit maximization and the accumulation of wealth or money capital. In his famous turn of phrase, Braudel’s “capitalism” is best understood as the “anti-market”, dominated by opaque (and often long-distance) transactions organized by actors and agencies seeking to remove themselves from the transparent competition of market life so as to maximize their profits and maintain the flexibility to move their money wealth to whatever line of activity may offer the highest returns. Braudel’s capitalism is thus synonymous not, as conventional wisdom would have it, with competition but monopoly and the domination of market life through power.
Although the Braudelian market/capitalism distinction may unfortunately add a bit of immediate terminological confusion – given the conventional conflation of markets with capitalism to which we have grown accustomed – I think it ultimately offers bigger picture clarification. For those trying to really think about capitalism as an actually-exsiting historical social “system’ – not to mention those trying to construct alternative such arrangements – Braudel helps us see beyond the seemingly insurmountable analytical puzzle that people producing, buying and selling goods using prices, and with some of them making profits, might not be engaged in “capitalism” per se, but some other kind of social process and logic. There are risks, though, in drawing this distinction, not least of which is perhaps a certain kind of romanticized notion of market life, “small business” and the local – all critiques that have accompanied the latest wave of interest in localist, small-scale, “right sized” and “independent” business. Braudel’s need not be a twee nor precious perspective, though, for it gives us a more descriptive and objective set of classifications. So, there we have it in its simplest form. What I’d like to do in subsequent posts is spend some time thinking through how we might apply this framework/assertion to the more concrete empirical world of the here and now, thinking about the craft/artisan/maker economy and framebuilders.