Vulture Capitalism

1. Capitalism: An Oligarchic Planned Economy, Not a Free Market

Life under capitalism means living in a planned economy, while being told that you are free.

Pervasive unfreedom. The common belief that capitalism is synonymous with free markets is a misconception that benefits the powerful. Instead, capitalism is fundamentally defined by the class division between capitalists, who own the means of production, and workers, who must sell their labor to survive. This inherent power imbalance means that decisions about how we work, live, and consume are largely predetermined by a select few.

Beyond market mechanisms. While markets, prices, and competition exist, they do not define capitalism. The system is characterized by the domination of society by "capital"—not just money or machinery, but a social relationship where owners make active decisions about resource allocation. This power is wielded by large corporations, financial institutions, states, and even global empires, all capable of planning to serve their own interests.

Invisible planning. This centralized planning is often invisible, disguised by the rhetoric of "free markets." It's a hybrid system where competitive pressures are selectively applied, often to those with the least power, while powerful actors manipulate market conditions for private gain. The question is not if planning occurs, but where, how, and whose interests it serves.

2. Corporations: Despotic Private Governments, Not Market Actors

The “free market” is a smokescreen, behind which lies the brutal, despotic power of corporations.

Beyond black boxes. Mainstream economics often treats corporations as "black boxes" that efficiently convert inputs to outputs. However, a deeper look reveals them as political institutions exercising "despotic power" over workers and society. Companies like Amazon demonstrate this, prioritizing expansion and market dominance over short-term profits, often at the expense of worker safety and fair wages.

Monopoly's enduring grip. Contrary to Joseph Schumpeter's "creative destruction" theory, large corporations rarely die. They use their immense profits to erect barriers to entry, acquire competitors, and influence technological development, leading to increasing market concentration. This "monopoly power" allows them to set wages, dictate prices to suppliers, and avoid taxes, leading to lower wages, reduced innovation, and increased inequality.

Corporate sovereignty. Corporations are not merely economic entities; they are "fictions, created by states" that wield a form of "private government." They influence political systems through lobbying, campaign donations, and even by shaping public discourse, as seen with Amazon's influence in Seattle or Jeff Bezos's ownership of The Washington Post. This "corporate sovereignty" grants them unaccountable power, blurring the lines between public and private authority.

3. Finance: The Unaccountable Architects of Our Economic Future

In our economy, the power wielded by the finance sector is directed towards securing the greatest wealth and power for those at the top – even if it means turning a blind eye towards, or indeed actively supporting, large-scale fraud.

Money creation and power. Banks, unlike the "loanable funds" model suggests, create money out of thin air through lending. This immense privilege, granted by the state, gives financial institutions significant power to shape the economy by determining which businesses, individuals, and states succeed. Their decisions, often driven by confidence and speculation, influence economic booms and busts.

Financialization's grip. The deepening relationship between banks and businesses, termed "financialization," has transformed financiers into powerful capitalist planners. As seen with WeWork's Adam Neumann and SoftBank's Masayoshi Son, personal relationships and speculative investments can prop up even deeply flawed companies, demonstrating finance's power to "buy time" and influence market outcomes without democratic oversight.

Central banks as planners. Central banks, far from being neutral arbiters, actively plan the economy. The "Greenspan put" and quantitative easing (QE) policies, for instance, have consistently protected large financial institutions during crises, inflating asset prices and enriching the wealthy, while claiming to act in the general interest. This reveals central banking as a political, not just technical, endeavor, further concentrating power.

4. States: Capital's Cronies, Not Neutral Arbiters

The function of the capitalist state is, as a scholar of Miliband’s work, Bob Jessop, puts it, to ‘defend the interests of the dominant class’.

The state as a social relation. The liberal idea of a neutral state separate from the market is a fantasy. Instead, the state is a "social relationship" reflecting the balance of power within society. Powerful groups, particularly capitalists, effectively organize within and around state institutions to shape policies in their favor, as exemplified by ExxonMobil's extensive lobbying efforts to undermine climate action.

Neoliberalism's planned state. Neoliberalism, far from shrinking the state, is a deliberate project to "retask" it. It involves constructing markets, intervening within them, and shaping citizens into "homo economicus" – rational, self-interested individuals. This "governmentality" uses subtle "nudges" and administrative power, as seen in the UK's "hostile environment" policies for migrants, to enforce compliance and depoliticize economic outcomes.

Weaponizing law and policy. The state's legal and policy frameworks are consistently weaponized to benefit capital. From lax antitrust enforcement in the US compared to Germany, to the Greensill scandal where former UK Prime Minister David Cameron lobbied for a firm he advised, the state's porousness to capital's influence is evident. This ensures "state-routinized crime" and corporate impunity, while workers and ordinary citizens face an impenetrable bureaucracy.

5. Empire: Global Planning for Perpetual Inequality

The less developed world will not become developed through the goodwill or generosity of the developed powers. It can only become developed through a struggle against the external forces which have a vested interest in keeping it underdeveloped.

Neo-colonialism's enduring grip. Formal independence did not end empire; it merely transformed it into "neo-colonialism." Powerful capitalist states, like the US, act as command centers of a global system, using military, financial, and legal power to maintain a hierarchy where rich countries dominate poor ones. This ensures that the global South remains a source of cheap labor and resources, preventing genuine industrialization.

The "imperialism of free trade." While liberal theory champions free trade as a path to universal prosperity, historically, rich nations "kicked away the ladder" by protecting their own industries before advocating for open markets. This "imperialism of free trade" forces poor countries to specialize in primary commodities, trapping them in a cycle of dependency and unequal exchange, as seen in the "banana republics" like Guatemala.

International institutions as tools. Global financial institutions like the IMF and World Bank, often dominated by rich countries, impose "structural adjustment programs" (SAPs) on indebted poor nations. These policies, such as privatization and deregulation, are designed to open up economies to international capital, not to foster genuine development. The result is often increased poverty, inequality, and capital flight, as exemplified by Zambia's experience.

6. Crises: Engineered Opportunities for Capital's Consolidation

Capitalist crises often take the form of collective action problems: a situation in which everyone would be better off if they cooperated to solve a problem but are nevertheless unable to do so.

Inherent instability. Capitalism is prone to frequent crises due to the uncoordinated actions of market participants. However, these crises are not purely "natural" events; they are managed by powerful public and private actors to shift costs onto working people and consolidate capital's power. This is "socialism for the rich, and ruthless individualism for everyone else."

The shock doctrine. During moments of crisis, the "shock doctrine" is deployed, where states and corporations collaborate to implement policies that benefit capital. Examples include the COVID-19 bailouts, which saw billions flow to large corporations that then laid off workers and paid dividends, and the 2008 financial crisis, where banks were rescued while ordinary people lost homes and jobs. McKinsey's role in pandemic responses further illustrates this.

Profits-price spirals. Recent inflationary crises, like the 2022 cost-of-living crisis, are not driven by "wage-price spirals" but by "profits-price spirals." Large corporations exploit shortages and market power to raise prices far beyond increased costs, funneling windfall profits to shareholders and executives. Central banks then hike interest rates, punishing workers and the poor, while protecting asset values for the wealthy.

7. Neoliberalism: A Deliberate Project to Entrench Capital's Power

Neoliberalism was never about ‘shrinking’ the state, it was about ‘seizing and then retasking’ it.

Beyond anti-statism. Neoliberalism is often misunderstood as simply advocating for a smaller state. In reality, it's a conscious political project to reconfigure state power to serve capital's interests. This involves dismantling worker protections, privatizing public assets, and deregulating finance, all under the guise of promoting "freedom" and "efficiency."

Hollowing out democracy. The neoliberal project aims to depoliticize economic life, reducing citizens to "consumers" and political debate to "problem-solving." This "economization of politics" curtails genuine freedom and democratic participation, replacing it with technocratic governance. The goal is to create a society where individuals are "human capital" competing on an uneven playing field, rather than collective actors.

"Double truths" and authoritarianism. Neoliberalism relies on "double truths"—publicly advocating for free markets while privately supporting strong, often authoritarian, states to enforce market rules and suppress dissent. Figures like Wilhelm Röpke, a founder of neoliberalism, even defended apartheid as a means to protect economic stability from "unfettered democracy," revealing the ideology's inherent anti-democratic tendencies.

8. Human Nature: Architects of Cooperation, Not Selfish Bees

Human beings are as disposed towards compassion and empathy as any other animal species. What differentiates us from other animals is our capacity to re-imagine and re-create the world around us.

Challenging cynical views. The prevailing capitalist narrative often portrays human beings as inherently selfish and competitive, requiring authoritarian institutions to maintain order. However, real-world examples, like the boys shipwrecked on 'Ata island, demonstrate a profound human capacity for cooperation, ingenuity, and compassion, even in desperate circumstances.

The Lucas Plan's vision. The Lucas Plan, developed by workers at Lucas Aerospace in 1976, epitomized this cooperative spirit. Workers proposed transforming weapons production into socially useful goods like kidney dialysis machines and wind turbines, showcasing their collective intelligence and desire for democratic, sustainable production. This challenged the managerial class's assumption that workers were merely "bees" to be controlled.

Disobedience as autonomy. Disobedience to authority is not a sign of selfishness but an assertion of individual autonomy and a prerequisite for genuinely civilized societies. The belief in inherent human selfishness serves as a justification for ruling-class authority, but history is replete with examples of people resisting control and organizing for a higher purpose, demonstrating that human nature is malleable and capable of profound social transformation.

9. Democratic Planning: A Viable Alternative at Every Scale

The significance of the Lucas Plan is that it showed in very concrete terms exactly how people could work together to build a better world.

Beyond state vs. market. The false dichotomy of "state versus market" limits political imagination. Democratic planning offers a third way, demonstrating that conscious control over the economy can be democratic, not oligarchic. Examples like Australia's Green Bans, Marinaleda in Spain, and the People's Plan for the Royal Docks in London show how communities and workers can collectively shape their environments and economies.

Local successes, global potential. Participatory budgeting in Porto Alegre, Brazil, and Kerala, India, illustrates how citizens can directly influence local spending and development priorities, leading to more equitable outcomes and increased civic engagement. These local successes provide a blueprint for scaling up democratic planning, proving that collective decision-making can be effective and empowering.

Technology for liberation. Salvador Allende's Project Cybersyn in Chile, despite its limitations and ultimate suppression, demonstrated the potential of technology for decentralized, democratic economic planning. While capitalist technology is designed to serve capital, the underlying principles of real-time data exchange and coordination could be repurposed for genuinely democratic ends, challenging the notion that large-scale planning must be top-down.

10. The Path Forward: Collective Struggle for Economic Democracy

The greatest barrier to the emergence and spread of these movements is not the overwhelming power of capital. It is the conviction, held by so many millions of people, that change is impossible.

Building dual power. Achieving democratic planning at scale requires a broad-based movement that works "within and against" the state. This involves strengthening labor unions, fostering community organizing, and engaging in protest and direct action to resist capital's domination. The Jackson-Kush Plan in Mississippi exemplifies this "dual power" strategy, building autonomous institutions while electing sympathetic political leaders.

Democratizing institutions. A truly democratic economy necessitates fundamental reforms across all institutions. This includes:

• Work: Removing anti-union laws, introducing sectoral collective bargaining, a four-day work week, universal basic services, and expanding worker and public ownership (e.g., Post Banks, People's Asset Manager).
• State: Eliminating undemocratic institutions (monarchy, unelected chambers), democratizing central banks, implementing participatory budgeting at all levels, and imposing strict limits on political donations and lobbying.
• International: Upholding the principles of the Bandung Conference and a New International Economic Order, ending unfair trade practices, rescinding regressive intellectual property rights, abandoning ISDS provisions, and establishing a global debt authority and climate bank.

Imagining a new world. The belief that change is impossible is the most significant obstacle to building a democratic society. History shows that new social orders emerge from the cracks of old ones, nurtured by individuals and movements with the imagination and tenacity to fight for a different world. The goal is not merely to reform capitalism but to eliminate the class distinction between capital and labor, allowing everyone to shape the conditions of their existence and flourish.