We are back, friends. Strap in for a mindboggingly stupid book-club update.

I'm more convinced I won't quit than I was last week, ... and more certain I will lose brain cells in this exercise. Oh, and plenty of lost respect for Marxians/Marxists (Did I ever have any??) — shocker, I know, but their intellectual edifice just isn't impressive, isn't working, and is as far from functional as anything can be.

Also, dude doesn't even lay that out! In the Preface and Intro he was all, "oh I'm going to look at capitalism historically and comprehensively as a phenomenon, I'm guud historian" instead of oppenly describing the theory and intellectual framework he's using to make sense of events. Sneak it in through the backdoor.

So here I am, making angry notes to myself while reading otherwise quite pretty prose, and asking Grok/Chat what various Marxian terms mean in their world... because how else am I ever to make sense of the 1,100 pages of crap I'm reading?

Previous episodes:Previous episodes:

#0 Preface: "Sven Beckert Begins His Tale"
#1 Introduction: "INTRODUCTION, and the Trouble of Defining 'Capitalism'"
#2: "CHAPTER 1, and the Historian Returns"

Capitalism is a system of merchants and merchant logic, merchants were capitalists; but when said merchants emerged, what they had wasn’t capitalism.

So we’re back at the hairsplitting definitional quibbles that kicked off this show (#1416318, #1416952).

We get actual “capitalism” — and not just stray capitali_sts_ when the merchants of the islands of capital “intensified the networks that connected them." It was “not just more of the same but the seedlings of a qualitatively different world” (p. 80)

THAT, claims Beckert (so far without evidence, but it’s only been a hundred pages…trust me, bro) with its novel economic logic was apparently what began this new capitalist revolution.

In China, he tells us, the “increased long-distance trade required greater capital intensity and more personell” Note: passive voice again (standard Marxist writing), and whatever in the world “capital intensity” is supposed to mean. I got annoyed and asked Grok about intensification, from a Marxist’s point of view:

“This applies especially to trade, trading networks, and capital, where intensification describes how these elements become more concentrated, interconnected, and accelerated under competitive pressures […] the ways capitalism ramps up the scale, speed, and depth of its operations to extract more surplus value.”

Honestly, these are just more words… concentrated, WHAT? Interconnected I might understand as longer production lines or more intricate division of labor (hashtag Smithian growth), but accelerated?! Trading ships in the Indian Ocean moved at the pace of the prevailing winds and season… sure, if you build/acquired more ships you could launch more of them, perhaps in turn connect to more trading posts further away, but you’re not “accelerating” or “concentrating” anything. What am I missing?

And in a mostly self-sufficient agricultural world, there is no more surplus value to be had, intensification or not.

By investing their capital to accumulate more of it, they took to global extremes the hoary trading logic of buying cheaply and selling dearly [...] these traders' work could be extraordinarily profitable. (p. 74, 75)

Well, technically speaking the could only derive "profits" (in monetary terms, which he almost never invokes -- though we got one page on the bills of exchange and hawala networks! -- and I'm plenty sure there were lots of silver and gold coins and nuggets involved) by geographic mispricing or arbitrage between relative values/scarcities in one place vs another. Thus, your profits would equilize prices everywhere (which we have lots of historical evidence for in the mid-1500s/1600s etc) and very quickly run out of stem. When silk trades for the same price in China as Iceland, minus transportation costs, there are no more Smithian profits to be had.

A statistic Beckert himself cites, the long-run economic growth over hundreds of years (up until around 1600 or so) is indistinguishable from zero.
(He cites world GDP/capita figures, 1000-1500.)

Bar raiding or slavery, you can't get your hands on more stuff: All additional value ostensible up for grabs stem from growth. And so we learn, correctly I might add, that

“one key effect of the capitalist revolution was that growth rates rose steeply” (p. 94)“one key effect of the capitalist revolution was that growth rates rose steeply” (p. 94)

I’m reminded of the "why are they confessing" scene from The Big Short.

Merchants are different, they get their goodies from the market.

Where I can meet Beckert on this is that he’s right to point out that extraordinary shift in the way people live their economic lives, the way they get by. It’s incomprehensible, not just for technological reasons (shipping, info, screens, electricity) to almost anyone from the 10th or 16th century how you or I make our living.
Merchants sold their services and acquired everything they needed at market – and “so had much in common with most readers of this book” — while almost everyone else on Earth “labored primarily for their own and their immediate community’s subsistence, not for exchange.”

= this is getting closer to a grand historical revolutionary transition that has carried the name Enlightenment, Industrial Revolution, Great Enrichment, globalization or just “capitalism.” The ultimate division of labor.= this is getting closer to a grand historical revolutionary transition that has carried the name Enlightenment, Industrial Revolution, Great Enrichment, globalization or just “capitalism.” The ultimate division of labor.

But the market, he informs us, was merely an “institutional ensemble” (p. 81) and it was “both produced by and the product of collective politics." In fact, he repeats (without evidence, tho hinting at it for the next chapter) that we couldn't get real capitalism until the capitalists took out/got help from their ally, the state.

On the very next page, he tries to present the same merchant logic emerging at the same time in different places. But the very fact that you’re crossing such vast and culturally and religiously different jurisdictions and finding similar merchant behavior is a pretty good indication that markets and tradingare NOT “a product of collective politics” or a “collective undertaking” (p. 81) — unless, somehow, the politics is the same everywhere.

“Producing for one’s own use was timeless” (p. 88)“Producing for one’s own use was timeless” (p. 88)

The supposed blurring of the lines between family and business (p. 76) is also a great indication that “capitalism” wasn’t this cordoned-off, revolutionary new force with a logic of its own. It was just good, common, economic (Oekonomia = householding, as I once elaborated for Mises.org) sense and optimization across domains – economic, social, and otherwise. People living on the existential margin are pretty good at optimizing.

The Social Relations
From the time Marx popularized (invented?) the word "alienation," the red dudes have loved this idea. Beckert is no different: FOR ALL human existence, “far from being seen as an autonomous sphere, was embedded in such a framework of social norms” (p. 89)

Lords and rulers existed, sure, and they had wealth (from tax, tribute and plunder) but that was all natural and obvious and well-known. They didn't acquire their stuff "through capitalist accumulation” (p. 89) and it was very embedded in social relationships, “mutual obligations,” and “not markets” (p. 91)… and it was only under capitalism that the “sources of inequality become obscured” (p. 91), passive voice.

elites in tributary regimes drew their surplus from the people they dominated through extra-economic means, and they had little interest in seeing the logic of the market interfere too deeply with these repressive but rewarding relations.” (p. 97)

Land and labor might have exchanged hands, but weren't traded on a market as commodities:

A few pages later, we learn that BECAUSE self-subsistence farmers needed "their" “resources” (I'm adding scare quotes because neither term makes any sense) to live on, as an existential matter, they often resisted merchants and capitalists trying to take it from them (“wrest control from them," p. 95). Neither plebs nor rulers approved (p. 98)... support neither from above nor below them in the social hierarchy.

As we will see, that resistance, much weakened and muted, continues to the present day. (p. 96)

Oh, I can't wait.

Despite their hard work and enormous creativity, merchants remained on the periphery. They were few in number… their presence in the everyday lives of almost all the world’s people was minimal. (p. 102)

Again, here I can meet him. As an objective description, correct: for most of (agricultural) human history, cities and merchants and specialized service providers were exceedingly rare.

UNLIKE TODAY, capital wasn’t the “prime revolutionary force" (p. 104)

capitalists were unable to create capitalism; they needed allies to break through the boundaries that hedged them in [And] the most powerful ally they would acquire was the state. (p. 104)

Additional commentaryAdditional commentary

In case you hadn't had enough.

There are so many throwaway mentions of capital self-propagating, the logic of capital, etc that I started making a more complete list -- for the next post, an interlude on the meaning of capital -- but in one of them he accidentally(?) was more specific: the "economic rationality of merchants” (p. 91). So, calculation? So, profit-and-loss? So optimization, with accounting and numbers? Now, it's getting interesting.

Also: the state-shit and social relationships gotta go. We live fairly capitalist lives in the 21st century, and yet we all have social relationships. We do not mediate our neighborly conflicts with wergeld; we do not purchase our wives at the market (though the Icelandic word for wedding = "bride" + "purchase," look it up); we do not bribe our friends to be with us.

In contrast to Marxian lore, where the state is a capitalist contraption – albeit captured by capitalists – for those of us with a set of functioning brain cells and a more, let’s say, skeptical, economic persuasion, the state is the opposite of all economic logic.

• It draws its vitality from violence, not mutually beneficial exchange
• it’s staffed by people who get feedback from bureaucratic appointments above, not satisfied customers below;
• it functions not by profit and loss or long-term incentives of ownership, but by mandates and political manifestos.

I don’t know what to tell people, even highly educated and accomplished scholars like Beckert, when they say that the state is a necessary “ally” of capitalism, and favoring the capitalist cause. DUDE, states eat 40-55% of GDP in all countries, however economically free, and take a corresponding portion of the economy OUT OF CAPITALISTIC CONSIDERATION. That’s unprecedented in human history.

The state is the most successful parasitic organization ever devised.The state is the most successful parasitic organization ever devised.

And it does not operate on capitalist principles. Go away, retard.