Emerald Group Publishing Limited
Copyright © 2011, Emerald Group Publishing Limited
1 Untiring future development of the capitalist system seen in retrospective
This remarkable panorama of the rise (and not yet fall) of capitalism comes at historically the right moment, just as its main actors and much of the world emerge from the great recession of 2008‐2009. Historian Joyce Appleby, self‐admitted as leaning politically to the left, recounts:
how capitalism as a new societal energy would develop in a manner far exceeding its purely economic thrust; and
how political shifts helped capitalism evolve into the oft‐condemned ideology that is has become as the twentieth century slipped into the twenty‐first.
Author Appleby, who taught for many years at the University of California (Los Angeles), explains and elaborates on process – how plans, methods and attitudes spring forth – and gives second yet appropriate place to personalities and the events they author – who did what, where, when and why – so that her narrative is synthesizing, smooth, and a pleasure to absorb. Throughout, Professor Appleby displays a remarkable knowledge of not only the mechanics of diverse economies, but also how they intermingle with and influence culture, technology and communication. Among the impacts of innovation, economics may conflict too – in a more abstract dimension – with ethics. In turn, ethics may tend increasingly to govern economic advance.
Appleby's tale begins in sixteenth‐century England, a country endowed with good soil for farming, many waterways to facilitate transport from production to marketplace, underground reserves of coal but dwindling forests, and a population soon free from indenture. The advent of the steam engine would find rapid application in the mechanizing of the textile and other craft industries. Ordinary men and women began to create “the infrastructure for a national market”, and then reached further afield. Trade routes abroad had grown since the days of the Persian, Greek and Roman empires as well as commerce with China along the Silk Road: “spices from the East Indies and silver from the New World”. With new mechanical means of manufacture, simple lives gave way progressively to new forms of spending or saving, “more beneficial to the economy” for not only families but even individuals.
2 Cycles of plenty and penury
The capitalist evolution is one of ups and downs, to be sure, a cycle of boom and bust (first described academically in the 1920s by the Leninist economic philosopher Nikolay Kondratev). Outside Britain and then Holland and Germany, “capitalism began as a system of production fueled by an insatiable drive for profit” whose investors “could bring with them their capital, but not the laboring men and women required to extract or grow” resources often obtainable far from the workshops. European entrepreneurs overseas thus “organized labor to their own advantage, usually with the help of local potentates who were bought off. [They] filled their letters back home with laments about the laziness and dirty habits of those on whom they depended for labor”. This was only part of the nastiness, however, attending the spread of Scottish philosopher Adam Smith's new ism.
As the high priest of capitalist philosophy, Smith foresaw in 1776 that “the invisible hand of the market that used competition to convert the profit motive into a force for good” would prevail. “Probably the most striking feature of capitalism has been its inextricable connection with change – relentless disturbances of once stable material and cultural forms”, stresses author Appleby. Austrian economist Joseph Schumpeter would later call “creative destruction”. This remains the case today, to the extent that the world's largest, single‐party State, China, “embraces market economics as its official cult for national achievement”. Under the parental gaze of Deng Xiaoping, therefore, Marxism married its antagonist and gave birth to today's prospering State capitalism. South Korea and Singapore, on the other hand, have shed highly authoritative governance in order to follow the purely capitalist route. Also now swinging from left to right in order to embrace capitalism are Brazil and India, followed enthusiastically by Mexico, Argentina and still others.
3 By way of conclusion
A final word on Ms Appleby's remarkable account of how capitalism edged its way from there to here – in effect a kind, yet critical, apologia pro vita sua of the ideology. She attributes repeatedly the largely successful ride of the ism to its fundamental monetary spur; yet she emphasizes that capitalism's main material failure is the endurance of poverty, while its main cultural defect is the fascination with money that it breeds.Joyce Appleby recalls that Schumpeter – author of the characterization of “creative destruction” – also mentioned the possibility that capitalism is even “doomed because of its tendency to destroy the institutions that protect it […] People do learn from their mistakes. There is no reason to think that societies won't continue to modify […] their economies in pursuit of shared goals. A relentless revolution, yes, but not a mindless one”.
Condemnations of capitalism such as these are attenuated, the author insists, by (for example) the admonition of a respected developing‐country economist. In a critical analysis published in 2000, Hernando De Soto of Peru had this to say: “I do not view capitalism as a credo. Much more important to me are freedom, compassion for the poor, respect for the social contract, and equal opportunity […] Capitalism […] is the only system we know that provides us with the tools required to create massive surplus value” (De Soto, 2000).
Historian Appleby's is a meditative essay, long in both pages and methodical analysis, and worth the time any futurist will takes to read this book.
A About the reviewer
Jacques Richardson is a member of foresight's editorial board, and has served 14 years in a diplomatic status. He is based at Decision+Communication, Authon la Plaine, France. Jacques Richardson can be contacted at: firstname.lastname@example.org
De Soto, H. (2000), The Mystery of Capitalism: Why Capitalism Triumphs in the West and Fails Everywhere Else, Basic BooksNew York, NY.