A Comment on Capitalist Origins

— Christopher McAuley

A discussion on the problem of "Eurocentrism" in theorization of capitalism and anticapitalist struggle was initiated with Ellen Meiksins Wood's esay on "Eurocentric Anti-Eurocentrism" (ATC 92, May-June 2001).  We present here a response by Christopher McAuley, author of The Mind of Oliver C. Cox, to be published by University of Notre Dame Press in 2001.  Other contributions will appear in forthcoming issues. — Editors.

ANYONE FAMILIAR WITH the many theories of the origins of capitalism is probably cognizant of the fact that, like all theories irrespective of the field, they are/were conceived in opposition to one or more competing theories.  On this matter, the theoretical divides have typically run along these lines: the genesis of specialized commercial capital vs. that of industrial capital; the economic development of Protestant Europe (namely, post-Reformation England and the Netherlands) vs. Catholic Europe (primarily the Italian city-states of the late-medieval era and the Spanish and Portuguese Empires of the early-modern era); European vs. extra-European loci and foci; Marxist vs. non-Marxist definitions and characteristics of capitalism; and internal (based on class/property relations) vs. external (trade relations based) catalysts of socioeconomic transformation.

Of course, none of the theories of the origins of capitalism named in the above dyads excludes elements found in the other theories; it is simply that one argument ranks above the others.  Thus, it is common to see particular combinations of the above arguments in one theory.  For example, theorists of the origins of capitalism who consider the Industrial Revolution its hallmark or culmination tend to focus on socioeconomic and sociopolitical developments in Protestant England between the sixteenth and nineteenth centuries.

Conversely, those theorists who look to specialized commercial exchanges as the early manifestations of an eventual full-fledged capitalism (of which industrial capital is but one branch), tend to place central importance on Catholic Europe, the impact of trade on national development (or underdevelopment), and when not bound by Eurocentric thinking, even to entertain extra-European origins, inputs, and/or contributions.

Frequently, however, even when theorists of the origins of capitalism identify themselves, by name, as members of the same school of thought, the differences between the positions of individual theorists is so great that it is no longer useful to put them in the same group.  Such is the case within the Marxist school of the origins of capitalism.  One school (and the student of intellectual currents would probably name more than two of them) largely adheres to the first model we described earlier—in internally generated transformation of class/property relations in pre-industrial England.

The second school locates capitalism's origins in commercial growth in the late medieval and early-modern eras in which colonialism and neo-colonialism figure quite largely.  In other words, theorists of this branch of the Marxist school of capitalism's origins share the belief with some non-Marxist theorists that regional, if not global, trade relations played a greater role in the development of capitalism than did the trajectory of a single nation's class relations.

It should also be mentioned as more than an aside that the overwhelming majority of those Marxist theorists in the first camp are of European descent, while a substantial number of those in the second are of African descent.  I would include scholars like Maurice Dobb and Robert Brenner in the first group and Samir Amin, Oliver Cox, C.L.R.  James, Eric Williams, and Walter Rodney in the second.

It should also be noted about the scholars of European descent in the second Marxist grouping that most of them have been students of "Third World" political economy and have incorporated those lessons and experiences into their theories of the origins and reproduction of global capitalism.  Here, I am referring to Immanuel Wallerstein and his initial work on Africa; Andre Gunder Frank and his early work on Latin America and now on Asia; and James Blaut (to whose ideas the second part of this essay is devoted) and his work on the Caribbean and continental Latin America.

I have opened this essay with these remarks not to provide a synopsis of the most recent trends in the theoretical explanations of the origins of capitalism, but rather to situate myself in one of the above groups—among the Marxists of African descent—so as to foreground my reading of Ellen Meiksins Wood's May/June 2001 article in Against the Current, "Eurocentric Anti- Eurocentrism," and of her more general work on the subject, The Origin of Capitalism (Monthly Review Press, 1999.  An expanded version is forthcoming from Verso.—ed.)

From my perspective, Wood's explanation of the origins of capitalism is representative of the first Marxist school that I described above.  I will refer to that theory as the Brenner-Wood thesis since she admittedly draws on Robert Brenner's findings and conclusions.  With that said, let me now turn our attention to their theory of the development of capitalism.

As theories of capitalism go, the Brenner-Wood thesis is ostensibly sound.  At its most basic level it posits this: It was only when property rights became formally established such that property owners could dispose of their land as they saw fit that we can locate and date the origin of capitalism.  In their view, this transformation began to take place in southeastern England as early as the fifteenth century when landlords inadvertently converted landholding into landowning in order to reverse the trend of declining incomes.  As Wood describes the process, "by claiming exclusive private ownership," landholders-cum-landowners, "challeng[ed] the customary tenures that gave many smallholders right of possession without unambiguous title." (The Origin of Capitalism, 82.  All quotes from Wood refer to this title except where noted.)

One immediate result of this transformation was that "tenure increasingly took the form of economic leases, with rents not fixed by custom but responsive to market conditions," as current and prospective tenants now had to compete with each other to secure leases.  (46) With "profits" now serving as the base of rent payments, both tenants and landlords, the Brenner-Wood thesis maintains, "had an interest in agricultural "improvement,' the enhancement of productivity by innovative land use and techniques, which often implied, among other things, enclosure [viz., landholding expansion]—not to mention increasing exploitation of wage labor." (47)

Of course, the pressure to "produce cost-effectively" weighed most heavily on tenants since failure to do so bore the threat or "penalty of dispossession." (76) Still, agricultural improvements (increase in farm size, draining of marshlands, introduction of crop rotation, etc.) were instrumental in the creation of the first national market, since greater agricultural production meant cheaper food and cheaper food meant that all but the poorest Briton had more money to spend on consumer goods.

Finally, in addition to laying the foundations for competitive leases, land sales, the creation of a wage-earning class, and an agricultural revolution, Wood maintains that the English property revolution also paved the way for the industrial revolution:

Although this is not the place to explore in detail the connections between agrarian capitalism and England's development into the first "industrialized' economy, some points are self-evident.  Without a productive agricultural sector which could sustain a large non-agricultural work force, the world's first industrial capitalism would have been unlikely to emerge.  Without England's agrarian capitalism, there would have been no dispossessed mass obliged to sell its labor power for a wage. Without that dispossessed non-agrarian work force, there would have been no mass consumer market for the cheap everyday goods—such as food and textiles—that drove the process of industrialization in England.  It is worth emphasizing that this large market derived its special character not only from its unusual size but also from its limitations, the relative poverty of consumers demanding cheap goods for everyday use. It had more in common with later mass consumer markets than with the luxury trade of "classical' commerce.  (102)

Before assessing this admittedly pared-down presentation of the Brenner-Wood thesis on its empirical and theoretical grounds, I think it important to mention what its proponents believe make this theory of the origins of capitalism superior to others.  Wood names at least four reasons.

First, the Brenner-Wood thesis does not fall into the trap of "reading capitalist principles back into pre-capitalist societies," as do other theories of the origin of capitalism.  (43) In order to avoid this pitfall, the Brenner-Wood thesis assumes that, unlike capitalist societies in which change and innovation is the order of the day, non-capitalist societies are socially conservative, thus their members pursue courses of action to maintain or to reproduce the standard of living to which they are accustomed.

In light then of this conservative bias on the part of non-capitalist actors, the transition to capitalism had to be, according to the Brenner-Wood thesis, the unintended consequence(s) of actions meant to preserve rather than to change the structure of non-capitalist society.

Second, in establishing the precise historical origin(s) of capitalism, the Brenner-Wood thesis draws a clear space/time line between non-capitalist society and capitalist society.  In other words, the Brenner-Wood thesis supplies capitalism with both a date and place of birth.  Again, not only does this determination demonstrate that capitalist society is not the natural or inevitable culmination of all pre-existing systems of production and exchange since time immemorial, but that it is a "qualitative break," a decisive departure from all societies that preceded and surrounded it.

Third, the Brenner-Wood thesis demonstrates that the market in capitalist society is the bestower neither of opportunities or of freedom as is popularly believed and as the "commercialization model" of the origins of capitalism implies.

Rather, the market in capitalist society is highly coercive: Most members of capitalist society must sell not only their labor power to their employers but also purchase or rent their means of reproduction or subsistence.  Unlike non-capitalist societies in which the market is governed by other social considerations (the will of God or of the gods, the ancestors, the Court, of custom, etc.), in capitalist society the market or, in more general terms, the economy shapes all other social forces in its image.

Finally, the Brenner-Wood thesis has an explicit political purpose which Wood describes most eloquently:

The purpose of this exercise is both scholarly and political.  The naturalization of capitalism, which denies its specificity and the long and painful historical processes that brought it into being, limits our understanding of the past. At the same time, it restricts our hopes and expectations for the future, for if capitalism is the natural culmination of history, then surmounting it is unimaginable.  The question of the origin of capitalism may seem arcane, but it goes to the heart of the assumptions deeply rooted in our culture, widespread and dangerous illusions about the so-called free market and its benefit to humanity.  Thinking about future alternatives to capitalism requires us to explore alternative conceptions of its past. (7-8)
Measured by these criteria, Wood maintains that James Blaut's attempts, most notably in The Colonizer's Model of the World and in Eight Eurocentric Historians, to de-eurocentrize the origins of capitalism falls short of the author's goal. As she sees it, Blaut's claim that "protocapitalism" existed in a number of societies before the Western European "take-off" in the fifteenth and sixteenth centuries, is merely an appropriation of an "old Eurocentric principle:"

In the old accounts, Europe surpassed all other civilizations by removing obstacles to the natural development of "commercial society;' in the anti-Eurocentric version, the failure of non-Europeans to complete the process of development, despite the fact that they had already come so far, was caused by obstacles created by Western imperialism.  (Wood, "Eurocentric Anti-Eurocentrism," 31)
Moreover, in failing to provide a precise definition of capitalism, Wood contends that Blaut "can have no clear conception of non- or precapitalist modes of production with different operating principles, and no conception of a transition of one to the other.  Commercial practices shade into "protocapitalism,' which grows into "modern' capitalism." (Ibid.)

Despite the undeniable relevance of Wood's remarks about Blaut's position, they do not address what I believe to be his more serious charges against her version of the origins of capitalism.  Of these there are at least three, one at each of the following levels: the empirical, the conceptual, and the ideological.  Each warrants a brief discussion.

At the empirical level, Blaut contests the Brenner-Wood thesis on what it claims about England's agricultural revolution as well as how it describes the volume of medieval trade.  As for the first point, Blaut maintains that contrary to its adherents' instruction not to read later events into earlier periods, the Brenner-Wood thesis does just that by inserting eighteenth-century agricultural advances in British agriculture into preceding centuries, as many as three centuries in some instances.

It is particularly in the case of the widespread adoption of crop rotation in place of the three-field system (thereby virtually doing away with the need for fallow) that Blaut believes that the Brenner-Wood thesis has manipulated time. With regard to the second point—the Brenner-Wood thesis' estimation of the volume of medieval trade—Blaut contends that the former minimizes the latter (particularly the scale of late-medieval Mediterranean trade) in order to exaggerate the significance of English agrarian capitalism.  (Blaut, Eight Eurocentric Historians, The Guilford Press, 2000, 53.  All quotes from Blaut refer to this work.)

On the conceptual front, Blaut charges the Brenner-Wood thesis with mysticizing the power of capitalism's "first" appearance.  "When it arrives," Blaut remarks, "it does so complete and entire, as though it were a god descending from Olympus to govern human affairs." (60)

Blaut adds that this mystical conception of capitalism leads its proponents to do great injustice to the historical record, particularly in the years between capitalism's first manifestations and the point at which payment in wages became the general form of labor remuneration not only in England and in its own empire, but in the world.  Here is how Blaut phrased just this point:

This mystical notion of capitalism substitutes for an empirical theory about the transition: the merely empirical facts may suggest a long, slow transition, with many complex and contradictory happenings, including some regressions toward classic feudalism—no matter.  At one mystical historical moment (or year, or handful of decades) capitalism appears and transforms rural England.  (60)
And it appears that only that "moment" matters to the Brenner-Wood thesis.

Of course, one of the "complex and contradictory happenings" to which Blaut makes reference in the above passage is imperialism and its role in the development of capitalism.

By and large, the Brenner-Wood thesis has no reason to entertain this question.  For in locating the roots of capitalism before (rather than during) the era of English overseas expansion, the Brenner-Wood thesis posits, as Blaut puts it, that colonialism "was not significant for capitalism, was rather a marginal process, a temporary aberration or diversion or sideshow, not a vital need of the system as a whole, which evolves in response to internal laws of motion." (45) It is this aspect of the Brenner-Wood thesis that strikes Blaut and others as intellectually racist.

Wood's response to charges like Blaut's is to raise Spain's failure to capitalize on an empire far larger than England's between the sixteenth and eighteenth centuries.  She regards this failure as proof that "much, if not everything, depended on the social property relations at home in the imperial power," and consequently that colonialism cannot be considered the parent of capitalism but rather capitalism's offspring.  ("Eurocentric Anti-Eurocentrism," 35)

While it is impossible to deny that England benefitted from its then modest empire in greater measure than Spain did from its vast one, comparing the outcomes of the two imperial ventures may raise more questions than it answers.  I refer primarily to the question of why English capitalists chose to colonize overseas (like Spanish non-capitalists) so soon after having happened upon the "self-sustaining process of economic development" as Wood describes capitalism ("Eurocentric Anti-Eurocentrism," 33), and thus before they had brought the entire domestic economy under its rule.

To this question we must also add the one that inquires why English capitalists chose to use unfree labor in many of their colonial possessions well after they had presumably already come to the realization that there were greater economic gains to be made in paying workers wages both at the production and consumption ends.

As I understand the implications of these questions, they should call into question both the contention that the origins of capitalism antedate the era of England's overseas expansion and that the use of unfree labor does not rank in the repertoire of capitalist labor forms.  And I believe that it is for reasons such as these that Blaut and others find themselves forced to reject both the definition and periodization of capitalism that theories like that of Brenner-Wood offer.

Bearing in mind these considerations, it is possible to conceive of an alternative interpretation of both the Spanish and English imperial examples.  From this perspective, Spain's inability to capitalize on its empire may have been due less to the self-imposed limitations of its domestic class structure and more to the acquisition of colonial possessions (both American and European) the scale of which exceeded the capacity of that country's military, managerial and mercantile personnel.  This overambition was no doubt fed by what seemed to many Spaniards in the sixteenth century the endless supply of Amerindian bullion.

Given their own imperial ambitions, it is doubtful that English "capitalists" would have acted differently from Spanish adventurers had they been the first to lay claim to Amerindian mines.  It is likely that they too would have waged even more wars of territorial expansion in the Americas as well as in Europe; would have used their riches to purchase luxury and even food imports to the detriment of domestic production; would have been forced to tolerate the illegal provisioning of their colonies and the plunder of their ships by European rivals; and they too would have relinquished to the Crown yet more political-economic power.

To restate this hypothetical imagining, put in an international imperial context, England's relatively late start in American expansion worked to that country's advantage because it enabled its elites to learn from Spanish mistakes and conversely from Dutch successes.  This was, in practical terms, the basis of mercantilist doctrine whose tenets English capitalists followed to great effect.

With these remarks about imperial Spain and England, it is not my intention to deny the empirical support of the Brenner-Wood thesis but rather to suggest that it tells only part of capitalism's story, its perspective from England, but one with which I am not convinced that even a sixteenth- or seventeenth-century participant would have agreed.

Again, for those of us who believe that the extra-European world made significant contributions (in the way of labor, resources, and the forward linkages derived from that labor and those resources) to the development of capitalism, what Wood sees as the "historical specificity" of her thesis, we see as a selective narrative that excludes extra-European inputs.

Consequently, in my reading of Blaut's project, his goal was not to claim the "prize" of capitalism's first site for the Afro-Asian worlds, but to underscore that the rise of capitalism in Western Europe was inextricably related to the decline of protocapitalism elsewhere.

Like Wood, Blaut also sought to get capitalism's story "right" not only for the purpose of demonstrating that it is not the "natural" culmination of history and therefore unnatural to desire its supersession, but also to show that non-European people have been and will continue to be instrumental in capitalism's demise just as they were integral to its genesis and reproduction.  In my opinion, the Brenner-Wood thesis does not lend itself to such an inclusive vision of the future.

from ATC 94 (September/October 2001)

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