Seven Left Myths about Capitalism




G. B. Taylor is a former student and long-time supporter of the ISE, currently living in Berlin. Comments and discussion are appreciated:

7 Left Myths about Capitalism

G.B. Taylor

Occupy Wall Street has renewed hope for a left political renaissance by challenging economic inequality and the neoliberal discourse that legitimated it, and reintroducing the word capitalism to political debate. The “greed” of the “1%,” counterpoised to the hardworking, rule-abiding 99%, has emerged as the dominant political frame of OWS. Rhetorically powerful, the slogan’s elegant simplicity conceals as much as it reveals. The language of “corruption,” the betrayal of Main Street by parasitic Wall Street bankers, and nationalist appeals to “take America back” all express a deep confusion as to the nature of the current crisis. This often results in a highly personalized moral critique of capitalism rather than a systemic one.

The crisis wracking capitalism today cannot be understood as simply the evil actions of greedy bankers and the 1%. In fact, as Max Weber pointed out, unlike the ostentatious opulence of earlier economic forms like feudalism, capitalism actually has tendencies which check greed – for example how intra-capitalist competition forces firms to save and reinvest. Thus the logic of states wielding coercive external power in human form as armies and police is quite different from that of capitalism, wherein power is more difficult to pinpoint or assign personal agency to. Conflating these two modes of power leads to very different political demands and outcomes. Capitalist power acts not only or even primarily on us from outside, but through us, as worker and capitalist alike are caught up in an impersonal competitive imperative that would quickly bankrupt any turncoat bankers or CEOs who might suddenly take Occupy’s message to heart.

With this in mind, I would like to examine seven myths about capitalism commonly found on the left that offer an incomplete critique of capitalism that points in the direction of insufficient reform or towards reactionary rather than emancipatory forms of anti-capitalism.


Why is decrying greed problematic? Because focusing on greed personalizes what is a structural problem, making it individual rather than systemic in nature. Although there are certainly greedy people, this is not a moral failing or “human nature,’ but people acting quite rationally within the structures of capitalism. Our present age of mergers and megacorporations is no accident; they are the winners within a capitalism driven by a grow-or-die imperative fueled by never ending competition. Within capitalism there is little space to act “ethically,” as institutionalized competition forces everyone – from owners looking to cut costs, workers seeking to maximize gain, and consumers hunting for the best price – to act immorally. By subjecting them to economic calculation, capitalism makes a mockery of our deepest ethical values. An analysis emphasizing greed points towards changing morality, when what is really needed is to get rid of the institutions that incentivize such behavior.


Another familiar charge in the current crisis is corruption, that greed drove bankers to corruption, breaking their own rules and wrecking the economy in the process. But capitalism obeys only one fundamental rule: generate ever more profit or perish. The language of corruption implies exception, a situation wherein something has gone wrong; but the problem is rather the rule: the ordinary workings of capitalism. Although there are always scandals where outright deception, bribery, or insider trading occur, the reality is that very few laws were broken in creating the current crisis. Calls for getting money out of politics only get us to the point of nations with strict election finance laws, like England, where politicians still govern according to the needs of capital. Corruption is not the problem.

Economic Nationalism

Strong nationalist currents have also surfaced in Occupy Wall Street. Whether it’s purple armbands that signify the mixing of the red white and blue of the flag, or the language of “Take America Back,” there’s a strong desire for a return to normalcy, defined as a middle class standard of living. But the idea that the state, like “the economy,” is a neutral and unified entity that works for the good of all is a falsehood: the nation-state never protected anyone from capitalism, but rather provides for its smooth functioning. Likewise, there was no “Golden Era” when capitalism somehow respected national borders in its search for new exploitable resources, labor, markets, and profit. At best it struck a compromise with a small percentage of mostly white workers in the West for a short time post WWII. America’s post-war economic dominance has faded; international competition has brought the austerity it once imposed on the third world home. In addition to reinforcing the state, such economic nationalism displays a callous disregard for people in other nations, as well as immigrants; a poignant reminder why rightwing libertarian elements were prominent in the early days of Occupy. But we don’t want to go back to an American Dream that was built largely on the backs of people of color both in the US and abroad. Capitalism has never worked for “the people,” American or otherwise, and never will.

Finance Critique

Another line of argument identifies finance as the culprit, contrasting the speculative greed of Wall Street to an honest and hardworking Main Street which produces tangible goods and services. It is claimed that Wall Street is a casino economy that doesn’t produce anything useful, has no loyalty to American workers, and is run by amoral CEOs who make astounding salaries. But this distinction between a real and unreal economy is a fiction, Main Street operates according to the same logic as Wall Street on a smaller scale, and may even finance parts of it. But more fundamentally, to single out banking misses the point: all capitalist enterprise exists to produce profit, not meet human needs.[1]

Finance as a sector has certainly grown in size and importance, but this must be contextualized within a larger trajectory of capitalist development – the FIRE (finance, insurance, real estate) economy became central to the neoliberal project because, aided by technological development, it was a convenient and low-cost strategy for dealing with the crisis of capital accumulation in the 1970s – finding new ways to extract profit in the face of international competition, automation, and the gains of workers’ movements.[2] But Wall Street is no more or less parasitic than any other sector of the economy. This populist analysis blames opulence, money, and abstract exchange while ignoring the equally problematic nature of good old fashioned exploitative wage labor, or how the two are mutually intertwined. Furthermore, both lines of argument must also cope with a present reality wherein to even be exploited as waged labor is increasingly the luxurious privilege of a dwindling few. The irony is that workers today appear to need capitalism more than it needs them.


The American left has often substituted a critique of corporations in place of a critique of capitalism.  And it’s easy to beat up corporate giants like WalMart, Coca Cola, Bank of America, whose global operations obviously do much harm. However, the problem is not a quantitative one of size or scale, but rather qualitative. Capitalism is a social logic which impels small companies to act the same way, and sometimes even worse. Large corporations, because of their size, reach, visibility, and superior resources, are often in a better position to be unionized or otherwise pressured to pay better and offer benefits smaller businesses simply can’t offer.[3]

In a conversation during the early days of OWS, activist “preacher” Reverend Billy expressed exactly this critique, stating that Brooklyn bodegas (corner stores) posed an alternative to “the 1%” economy because they build community – you might know the person behind the counter or be able to momentarily leave your kid there while running an errand. Yet these same bodegas are often family businesses employing family members who are un- or underpaid, work long hours and lack vacations or health care.  OWS has suggested moving money out of big banks like Bank of America and Chase and into smaller credit unions. Unfortunately, it turns out many credit unions are engaged in the same practices as larger banks, only at a local level.[4]

Focusing on large corporations also has the tendency to reduce politics to aesthetics: absent a critique of the common logic behind large and small firms, politics becomes a search for authenticity too easily channeled into consumption and individualism. Size is not the problem; the only real difference between WalMart and Etsy is taste and market share.


These various partial critiques easily combine to produce conspiratorial views of capitalism. In this view the problem is the result of a secret, hidden cabal of evildoers – we just need to rip off the façade and – voilà! – liberation. This narrative of redemptive revelation is seductive, but it ignores the systemic nature of capitalism. Marx stated that capitalism operates “behind our backs,” appearing natural and rendering exploitation invisible so that when problems are identified, conspiratorial perspectives become attractive. But the problem is not the secret machinations of the Federal Reserve, bankers, Jews, or the trilateral commission but the fundamentally irrational logic of capitalism.[5]

Alternatives and the Myth of Autonomy

Faced with the ugliness of capitalism, understandably people often look to alternatives such as cooperative enterprises, community supported agriculture, farmers’ markets, local currencies and barter networks. These projects often provide important and desirable things like higher quality products, a sense of community, or increased self-management. However, their limitations are too often overlooked or simply wished away. Embedded in the same capitalist logic and subjected to the same market pressures as traditional firms, they can easily become indistinguishable from entrepreneurship with noble intentions. But you can’t small business your way out of capitalism. The workers’ cooperative of Mondragon in Spain is an instructive example. Forced to compete with traditional firms, their avowed political aims like higher wages, longer vacations, or environmental considerations become a competitive disadvantage in relation to firms lacking such moral scruples. The result is that Mondragon increasingly resembles a typical capitalist enterprise, compelled to make similar decisions only with fewer bosses to blame.

Such projects are often oblivious to the long history of attempts to economically move away from capitalism, or to restrain it politically. In France, 1981 Francois Mitterand tried to implement a moderate socialist program and was rewarded with massive capital flight, he quickly changed course. In Greece, it was socialists who presided over post-crisis austerity. The “market” also recently punished France for its insolence in electing a socialist president. If even powerful nation-states are powerless to control capital, how can small enterprises expect to fare any better?

In their zeal to transcend the many horrors of capitalism, many of these strategies seek to jump outside of it. But “autonomy” from capitalism is even more impossible than autonomy from the state it has captured. Limited by the competitive pressures of a market economy and private ownership, every social gain won by alternative economic projects or reform-minded politicians constitutes a competitive disadvantage against capitalist firms, or nations, lacking such scruples. The result is typically liquidation or a more self-managed form of capitalism not so distant from the quintessential entrepreneurial dream of “being your own boss.” However, acknowledging Adorno’s insight “There is no right life in the wrong one” is not to admit defeat but instead to demand a politics which squarely confronts the structural limitations – and opportunities – posed by the totality of capitalism.

Why Does Our Analysis of Capitalism Matter?

Having an accurate understanding of capitalism is not simply a nitpicky or academic concern; it is important because different analyses of capitalism lead in very different political directions, not all of which are emancipatory. Unfortunately, some of the critiques put forth by Occupy today unwittingly echo slogans from National Socialism – to “take back” the economy from a disloyal and parasitic class, make the economy work for the “right” national group, etc…  The left has no monopoly on critiques of capitalism, and given its present historical weakness there is great danger in the rise of reactionary forms of anticapitalism. Around the world today right wing movements and parties tap into economic discontent and channel it into nationalism, blaming foreigners, welfare recipients, and “disloyal” corporations. One common nationalist demand is to make capitalism work “once again” for the native-born citizens of their respective countries. But such nationalist and fascist critiques of capitalism are false solutions in that they misunderstand the nature of capitalism and pose authoritarian solutions that destroy freedom.

The documentary film “Inside Job” provides a good example of this constellation of false critiques, and the problematic political solutions they imply. It portrays the economic crisis as a classic case of a few “bad apples” whose greed and bad morals, established through their use of cocaine and prostitutes, also happen to ruin the economy. The film even goes so far as to biologize the problem, showing brain scans that allegedly show how excited bankers get when handling money! Its final panoramic shot of the Statue of Liberty suggests a patriotic return to economic nationalism, naively utopian in the face of a globalized capitalist economy that has long since rendered even such mythical notions quaint.

Many historical factors sustain today’s fuzzy thinking about capitalism. One is the legacy of the Cold War: the collapse of “actually existing socialism” and resulting “End of History” consensus only strengthened a hysterical anticommunism that made talking about capitalism, let alone socialism or communism, almost impossible in the United States. Systematic repression from McCarthyism to COINTELPRO also contributed to the rise of a left which largely neglected political economy for 40 years, while more robust critiques and history of capitalism languished in ever-dwindling sectarian Marxist circles. American traditions of pluralism, pragmatism, and anti-intellectualism also work against a deeper theoretical understanding of capitalism. This also sheds light on the current popularity of prefigurative politics. While the desire to model the world we want in the here and now is an admirable one, it also holds out the seductive fiction that we don’t need politics, analysis, or organization – we can lead by example, until so many people join that the world changes. Thus prefigurative politics fills the vacuum of left ideas, allowing populists and anarchists to converge in practical matters while carefully avoiding addressing questions or demands which will inevitably entail fragmenting the perceived unity of the 99% based on how they understand the nature of the problem and preferred solution.

The Need for Radical Thinking

After years of neglect, Left prescriptions on economy have become vague, opportunistic, lacking vision. Many simply nod along to recycled Keynesian solutions of those like Paul Krugman, which fail to explain why social democracy was steamrolled by neoliberalism in the first place. The economic crisis of 2008 revealed that capitalism is only in “crisis” when it hurts capital. But if the fundamental issue is to make the economy serve human need rather than the other way around, then why stop halfway? Capitalism certainly hasn’t – the most “successful” revolution in terms of transforming the globe in the last 40 years has been the market utopianism of neoliberalism. We must also think big: we don’t just want a bigger slice, but the whole damn bakery!

In this regard, we should learn from the capitalists, who ironically have adopted traditional left demands more ably than the left itself has. Automation has made fewer jobs necessary, and everyone knows work sucks anyway, so why should the left valorize toil and beg for useless busywork jobs? Instead of chastising the 1% for their lives of idle luxury, we should be demanding it for all. And sadly it has been the capitalists, not workers, who have shown they have no nation. We can follow suit with a militantly cosmopolitan internationalism that has no more use for borders than transnational corporations does. The “crisis” has revealed that what used to be deemed impossible is in fact a matter of political will, as the state has bailed out banks and nationalized the auto industry while leaving people to fend for themselves. The result is a perverse socialism in reverse: socializing all the risk while privatizing all the wealth. Our task is simple: the current crisis has shown that a society organized around production for the accumulation of profit doesn’t work – even according to its own standards. It’s up to us to reverse this communism for capital, making our vast productive capacity serve humans, not the other way around.

[1] Ross Wolff, “Concerning Greed and Romantic Anticapitalist nostalgia.” The Charnel House.

[2] David Harvey. A Brief History of Neoliberalism. Oxford: Oxford University Press, 2005

[3] Doug Henwood. “Small is Not Beautiful.” National Post (Canada), September 23, 2003.

[4] Henwood, Doug. “Moving Money (revisited).” Left Business Observer. November 8th, 2011.

[5] Spencer Sunshine. “Occupied with Conspiracies? The Occupy Movement, Populist Anti-Elitism, and the Conspiracy Theorists.” Shift Magazine, November 2011.