Beyond “Racial Capitalism”

The uprising sparked by the police murder of George Floyd in Minneapolis has again placed the question of race at the center of politics in the US. While the right steadfastly denies the existence of racism and advocates greater repression against those protesting police violence, the left—both liberal and socialist—is scrambling to come to grips with the rebellion. For the liberals, the problem is simply a “lack of diversity”—that the police, the middle classes, corporate America, and the political establishment do not “reflect” the population as a whole. The liberals hope to derail these struggles as they did those of the 1960s and 1970s by promoting a new middle class of color without addressing the growing poverty and insecurity of working people of color. As Asad Haider¹ has argued, the neo-liberals have transformed “identity politics” from an attack on racism, sexism, and capitalism into a demand to diversify the political and economic elite without tampering with massive inequalities of wealth and income.

The socialist left is also attempting to catch up with events. The main organization of the US left, the Democratic Socialists of America (DSA) was caught back-footed by these new struggles and has found it difficult to move from the routines of Democratic Party electoral politics to organizing an ongoing movement against racism and capitalism.² Some in the DSA have failed to embrace the most radical demands of the uprising—to defund, disarm, and disband the police—and instead argue for continued campaigning around “universal” demands to raise wages (including those of the police) and the funding of public services.³ Some on the left who want to transcend both neo-liberal identity politics and class reductionism have put forward the theory of “racial capitalism.” The idea that capitalism and racism are linked can be traced back to Marx, through the works of Eric Williams, Oliver Cromwell Cox, and, most recently, Cedric Robinson; and is deployed today to argue for a politics that organizes against both racial oppression and class exploitation.⁴

In a recent posting on the Dissent webpage, Michael Walzer admits to being “puzzled” by the term “racial capitalism.”⁵ While acknowledging that the histories of capitalism and racism coincide in the United States, Walzer asserts that not all capitalisms involve racism. He argues that “the form of capitalism sponsored by the Chinese communists is obviously non-racial” because persecuted Muslims are “Caucasians,” and that all the workers Friedrich Engels studied in Manchester in 1844⁶ were white. Because “capitalism is the universal exploiter” it is “color-blind”—“any available worker will do.” Thus, “capitalism and racism have to be analyzed separately… the overlap is circumstantial, not necessary.”

Walzer’s argument suffers from two problems. First, it reduces racism—the notion that humanity is divided into distinct groups, with unchangeable characteristics that make one group inherently superior, and others inherently inferior⁷—to phenotypic differences. As the British Marxist Satnam Virdee has argued, the analysis of race has to move beyond “a color-coded phenomenon, to bring into view other modalities of racism,”⁸ such as anti-Irish and anti-Semitic racism. Just as the Irish were racialized as a part of the inherently inferior “Celtic” race in Britain in the 19th and 20th centuries, the differences between the dominant Han Chinese and the Uyghur Muslims are racialized—made essential and unchangeable. Second, and in some ways more profoundly, Walzer and other “class reductionists” confuse the historical preconditions for the emergence of capitalism with the necessary and unavoidable effects of the reproduction of capital through accumulation and competition. They are thus unable to explain the universal persistence of racial inequality among working people under capitalism.⁹

Unfortunately, Walzer’s critics’ attempts to mobilize the notion of “racial capitalism” to argue for a necessary, rather than contingent relationship between capitalism and racism reproduce the analytic separation of capitalism and racism. In a spirited reply to Walzer,¹⁰ Olúfẹ́mi O. Táíwò and Liam Kofi Bright deploy the works of Cox and Robinson to demonstrate how capitalism and racism are intertwined. While both Cox and Robinson hold to the problematic “commercialization model” of the origins of capitalism, where capitalism emerges naturally from the expansion of trade,¹¹ they make fundamentally incompatible arguments about the relationship of capitalism and racism. Cox asserts, correctly in my view, that racism as a distinct way of differentiating human beings developed with capitalist social property relations and is a necessary feature of this system. Robinson, by contrast, argues that European feudalism was “racialized” well before the emergence of capitalism. Like contemporary theories of intersectionality, where race and class are treated as separate but intertwined systems of oppression¹² Robinson’s notion of “racial capitalism” views the relationship of racism and capitalism as historically contingent—if capitalism had emerged outside of Europe, racism would not have been a necessary feature.

Robinson’s claims that racism existed in Europe before the emergence of capitalism is based on a fundamental confusion between pre-capitalist and capitalist modes of differentiating human beings. In classical antiquity and feudalism, humans differentiated one another by categories like religion (“heathens and believers”) and kinship-community (“strangers and neighbors/kin”). Both tended to be highly flexible and changeable through conversion, adoption, marriage, and the like. There was no need for the notion of inherent and unchangeable divisions among humans because social inequality was legally and judicially inscribed in pre-capitalist class relations. In modes of production based on serfdom, slavery, and other forms of legal coercion, inequality was assumed to be the natural condition of humanity. Only with capitalism do we see the birth of the notion of natural human equality. The disjuncture between the lived experience of legal-juridical equality in the labor market and the substantive inequality of capital and labor in capitalist production requires the invention of race.

It is true that a form of proto-racism emerged in the Iberian Peninsula before the emergence of capitalism. In the late 14th and early 15th centuries, Absolutist monarchies in Castile and Aragon, fearing that converted Jews and Muslims secretly maintained their religious rituals, defined only Christians of “pure blood” eligible for venal offices.¹³ But it was only with the emergence of African slavery in late 17th century Virginia that race is crystallized. While slavery had existed for millennia, it was one of numerous forms of unfree labor (serfdom, servitude, etc.), and did not require any special explanation. In the wake of Bacon’s Rebellion of 1676, indentured servitude and other forms of unfree labor which had brought Europeans to the colonies disappeared in Virginia, leaving only enslaved people of African descent unfree by the early 18th century. Here, for the first time, legal freedom and equality appeared to be the “natural” condition of humans—requiring a notion of intrinsic and permanent difference to explain why Africans remained unfree.¹⁴ Race and racism did not disappear with the abolition of New World slavery in the 19th century, but instead became generalized across the capitalist world. The specific terms of racist ideology—what specific characteristics made some groups superior and other inferior—evolved with changing class relations and differentiations. While racialized slaves were viewed as ungrateful, untrustworthy, and half-witted, racialized wage workers became undisciplined, irregular and refractory employees. In the colonial world, the supposed “inability” of native peoples to “improve” agriculture justified the appropriation of land and resources by the colonists.¹⁵

Most importantly, the reproduction of capitalist social property relations through the “dull compulsions” of the market—what Marx called the law of value—makes the relationship of capitalism and racism necessary, and not historically or theoretically contingent. Put simply, the notion of “racial capitalism” is redundant—there is no “non-racial” capitalism. Many Marxists do not grasp their necessary relationship because they assume that the operation of the law of value should homogenize labor by creating generally used labor-processes, equalizing profits and wages between and within industries.¹⁶ While this conception of Marx’s theory of value, accumulation, and competition is quite widespread, it reflects neither Marx’s mature theory nor the actual history of capitalism. The reproduction of capitalism produces not homogeneity but heterogeneity among capitalist and workers.¹⁷ The notions that accumulation and competition should homogenize conditions of production, labor-processes, wage rates, and the like is ultimately derived from neo-classical economics’ idealized vision of competition—“perfect competition.” Real capitalist competition, throughout the history of this mode of production, has never corresponded to the dream world of “perfect competition.”

Real competition and accumulation take place through constant technological innovation in the form of the increasing mechanization of production, differentiating capital and labor in two ways. First, the process of mechanization in one branch of production leads to a portion of the workforce being made redundant from capital’s point of view. This constant replenishment of what Marx called the “reserve army of labor,” the mass of unemployed and underemployed, not only keeps wages within the boundaries of profitability, but creates the possibility of heterogeneous labor-processes, profit-rates, and wages among branches of industry. While the increasingly capital-intensive industries enjoy higher profits and the possibility of higher wages, the constant replenishing of the reserve army allows the constant reproduction of labor-intensive industries with lower profits and lower wages. Put simply, “sweated labor” under capitalism is not some atavistic hangover of earlier forms of production, but the necessary consequence of the continued, but necessarily uneven and combined mechanization of production.¹⁸ The constant generation of the reserve army, with workers experiencing different levels of precarity and desperation, produces workers who have little choice but to accept the worst jobs. Labor-intensive, low-wage sectors can avoid raising wages by tapping into these pools of desperate workers.

Second, competition within and between industries necessarily differentiates labor-processes, profits, and wage rates. Capitalists are in a position to adopt the most advanced fixed capital when they enter a branch of production or open new productive units. However, “the presence of fixed capital investment” makes it impossible for these new techniques to be “immediately adopted by all firms in the industry […] Rather than creating identical firms, competition therefore creates a continual redifferentiation of the conditions of production.”¹⁹ Put simply, both accumulation and competition produce and reproduce differentiation among workers—the social matrix for the production and reproduction of race and racism.²⁰ Race is the necessary and unintended consequence of capitalist competition and accumulation: race and class are co-constituted under capitalism.²¹

Capitalist social property relations give rise to a contradictory lived experience for both capitalists and workers.²² On the one hand, capitalism is the first form of social labor in human history where exploitation takes place through what appears as the exchange of equivalents in the labor-market.²³ Rather than relying on personal domination or other forms of extra-economic coercion, capitalists and workers confront each other on the labor-market as owners of distinctive commodities—capitalists owning money, and thereby the means of production, workers their labor-power. Capitalists purchase the workers’ capacity to work generally at its value, the historically constituted social conditions of the reproduction of the workers’ labor-power. As capitalists consume labor-power—put workers to work in labor-processes under the command of capital—workers are compelled to produce value in excess of the value of their wages.

The buying and selling of labor-power gives rise to a very specific vocabulary of lived experience that spontaneously disguises exploitation and promotes the notion of the equality of all human beings. In Value, Price and Profit (1865),²⁴ Marx argued that under slavery all labor appears unpaid, and under serfdom the division between paid and unpaid labor is clearly visible in the division of crops and labor. By contrast, under capitalism “even the unpaid labor seems to be paid labor” because “the nature of the whole transaction is completely masked by the intervention of a contract…” In Capital (1867), Marx identified how this produces a distinctive lived experience:

The sphere of circulation or commodity exchange, within whose boundaries the sale and purchase of labor-power goes on, is in fact a very Eden of the innate rights of man. It is the exclusive realm of Freedom, Equality, Property, and Bentham. Freedom, because both buyer and seller of a commodity, let us say of labor-power, are determined only by their free will. They contract as free persons, who are equal before the law… Equality, because each enters into relations with the other, as with a simple owner of commodities, and they exchange equivalent for equivalent. Property, because each disposes of what is his own. And Bentham, because each looks only to his own advantage.²⁵

However, once we leave the idealized world of commodity exchange, we enter the real world of capitalist production, accumulation, and competition—the real world of exploitation. Capitalism necessarily produces substantial inequalities—between capital and labor, within the working class, and between different societies in the capitalist world economy. While inequality was assumed to be “natural” before capitalism, it must be explained under capitalism in a way that is compatible with the notion that human beings should be free and equal. This requires a re-naturalization of difference through the division of humanity into groups with unchangeable characteristics making some superior, others inferior. Only if some people are not “fully human” can both capitalists and workers make sense of a society where all appear to be equal, but there is real inequality.

Racial and gender differentiation are the most common ways both capitalists and workers understand and negotiate the heterogeneity of the labor market. Gender differences, which are rooted in the social construction of biological differences between men and women, are ideologically naturalized. Put another way, gender differences are ideologically reduced to biology in capitalist societies, which purportedly explains women’s inherent inferiority to men. Race, of course, has no biological existence, but only a social and historical reality. Racism naturalizes differences in physical appearances, religion, language, and the like. In this way racist ideology provides a potent mental road map to the contradictory lived experience of capitalist accumulation and competition.

The structure of the capitalist labor market, with its differentiation between the active and reserve armies of labor and relatively low wage/labor intensive and high wage/capital intensive branches of production, both compels and enables²⁶ capitalists and workers to racially structure the distribution of labor-power across the economy. Put another way, human beings produce and reproduce racial differentiation, but not under the conditions of their own choosing. The role of capitalists in racially organizing the labor market and deliberately promoting racialized divisions among workers is well documented historically. Capital is confronted with a mass of workers, almost all of whom can perform almost any task required, given the lowering of the average level of skill and training required for most jobs. Employers use fictional racial “characteristics” to determine who are the most “reliable” and “efficient” workers for different tasks.²⁷

However, workers, especially when organizations of collective struggle against capital like unions are unable or unwilling to confront employers and state, also attempt to organize competition with other workers along racial lines. As Robert Brenner and Johanna Brenner have argued, “workers are not only collective producers with a common interest in taking collective control over social production. They are also individual sellers of labor power in conflict with each other over jobs, promotions, etc.”²⁸ When collective struggle against capital and the state appear “unrealistic,” workers turn on one another. Workers attempt to socially construct themselves as “white” to protect themselves from the pressures of the always racialized reserve army of labor and the threat of being easily replaced as capital deskills labor through the fragmentation of tasks and mechanization.²⁹ It is this form of labor-market competition that fueled antebellum northern white skilled workers’ projection “onto Black workers what they still desired in terms of the imagined absence of alienation, even as they bridled at being treated as slaves, or as ‘white n*ggers.’”³⁰ The result of the continual competition among workers—which mirrors the competition among capitalists—is the over-representation of workers of color among the reserve army of labor (with consistently higher rates of unemployment, underemployment, and poverty) and in the labor-intensive, low-age sectors of production.

White racial advantage is fundamentally rooted in this competition, as they seek to maintain lower levels of unemployment and poverty, access to more secure and better paying jobs, which allow white workers greater access to better housing and education for their children, and the like. However, the continuous, spontaneous reproduction of race through capitalists accumulation and competition undermines the collective capacity of workers to resist capital’s demands, creating a downward spiral in wages and working conditions for all workers. Not surprisingly, the “wages of whiteness” have become rather meager in the age of neoliberalism. However, multi-racial working class unity will not be produced spontaneously—it will require the rebuilding of a culture and organization of solidarity.³¹ Clearly, struggles for universal, class-wide demands—higher wages, greater job security, health care and pensions not tied to employment, etc.—will be crucial in forging a multiracial workers’ movement. Every measure that reduces competition among workers undercuts the appeal of white supremacy. However, a multiracial working class movement will not be built through struggles around “universal” demands alone. The “color-blind” appeals to workers made by the mainstream of the industrial union movement of the 1930s and 1940s allowed racial divisions among workers to deepen and contributed to its failure to organize the South.³² Thus, race-specific demands like defunding and disarming the police, ending housing and educational segregation, plant and industry-wide seniority,³³ affirmative action in hiring and promotion, legalization and a path to citizenship for undocumented immigrants, and the like will be essential to building multiracial working-class solidarity. Put simply, effective class organization and politics—forging working-class unity among a necessarily racially heterogeneous class—must include anti-racist organizing and demands.

1. Asad Haider, Mistaken Identity: Race and Class in the Age of Trump (London: Verso, 2018).
2. Justin Charles, Michael Esealuka, Cinzia Arruza, Haley Pessin, Brian Bean, “Socialists and the Uprising: An Activist Roundtable” Tempest https://www.tempestmag.org/2020/08/socialists-and-the-uprising/ /li>
3. Dustin Guastella, “To End Police Violence Fund Public Good and Raise Wages,” Nonsite.Org (July 9, 2020) https://nonsite.org/policing-symposium/
4. Eric Williams, Capitalism and Slavery (Chapel Hill, NC: University of North Carolina Press, 1944); Oliver C. Cox, Caste, Class, and Race (New York: Doubleday & Co., 1948); Cedric Robinson, Black Marxism: The Making of the Black Radical Tradition (Chapel Hill, NC: University of North Carolina Press, 1983).
5. Michael Walzer, “A Note on Racial Capitalism,” Dissent (July 29, 2020), https://www.dissentmagazine.org/online_articles/a-note-on-racial-capitalism and “A Reply” Dissent (August 7, 2020), https://www.dissentmagazine.org/online_articles/a-reply-to-olufemi-o-taiwo-and-liam-kofi-bright
6. Friedrich Engels, The Condition of the Working Class in England (1845), https://www.marxists.org/archive/marx/works/download/pdf/condition-working-class-england.pdf
7. These purportedly unchangeable characteristics can be imagined to be either biological, as they were from the 1880s through the 1940s; or cultural, as they have since the 1950s. See Stephen Steinberg, The Ethnic Myth: Race, Ethnicity and Class in America, 3rd Ed. (Boston: Beacon Press, 1989), Part Two, Introduction and Chapter 4 for a discussion of how “culture” became an inherited and unchangeable characteristic in post-World War II racial thinking.
8. Satnam Virdee, Racism, Class and the Racialized Outsider (London: Palgrave, 2014), p. 3.
9. The late Ellen Meiksins Wood, a much more sophisticated analyst of capitalism than Walzer, makes a similar methodological error when she argued that “Sexual and racial equality… are not in principle incompatible with capitalism.” Democracy Against Capitalism: Renewing Historical Materialism (New York: Cambridge University Press, 1995), p. 259.
10. Olúfẹ́mi O. Táíwò and Liam Kofi Bright, “A Response to Michael Walzer” Dissent (August 7, 2020) https://www.dissentmagazine.org/online_articles/a-response-to-michael-walzer]https://www.dissentmagazine.org/online_articles/a-response-to-michael-walzer
11. Ellen Meiksins Wood, The Origins of Capitalism: A Longer View (London: Verso Books, 2002).
12. For an excellent exposition and critique of intersectionality see Holly Lewis, The Politics of Everybody: Feminism, Queer Theory, and Marxism at the Intersection (London: Zed Books, 2016), pp. 273-274.
13. See the essays collected in Max S. Hering Torres, María Elena Martinez, and David Nirenberg (eds.), Race and Blood in the Iberian World (Zurich: LIT Verlag, 2012); and David Nirenberg, “Was There Race Before Modernity? The Example of ‘Jewish’ Blood in Late Medieval Spain” in Benjamin Isaac, Joseph Ziegler and Miriam Eliav-Feldon, The Origins of Racism in the West (New York: Cambridge University Press, 2009), pp. 232-264.
14. The best treatments of the invention of race in colonial Virginia remain Theodore Allen, The Invention of the White Race, Volume Two: The Origins of Racial Oppression in Anglo-America (London: Verso, 2012), Edmund S. Morgan, American Slavery, American Freedom: The Ordeal of Colonial Virginia (New York: W.W. Norton & Company, 1975, Chapters 15-16; Barbara J. Fields, “Slavery, Race and Ideology in the United States of America,” New Left Review I/181 (May-June 1990), pp. 95-118.
15. Despite its “post-colonial” theoretical framework, Brenna Bhandar’s Colonial Lives of Property: Law, Land and Racial Regimes of Ownership (Durham, NC: Duke University Press, 2018), describes how modern property law in the white settler colonies codified the racialized ideologies justifying the expropriation of indigenous populations.
16. For example, David Roediger and Elizabeth Esch claim that “From The Communist Manifesto forward, capitalism has for more than 160 years received credit from the mainstream of Marxism for introducing a ‘cosmopolitan character to production and consumption in every country’ […] Value arises from making labor abstract, not from accentuating differences among workers”. The Production of Difference: Race and Management of Labor in US History (New York: Oxford University Press, 2012), p. 6. Roediger and Esch’s understanding of value theory, accumulation and competition are drawn from Michael Lebowitz, “The Politics of Assumption, the Assumption of Politics” Historical Materialism, 14:2 (2006)
17. Anwar Shaikh, Capitalism: Competition, Conflict, Crisis, (New York: Oxford University Press, 2016); Howard Botwinick, Persistent Inequalities: Wage-Disparity Under Capitalist Competition (Chicago: Haymarket Books, 2018)
18. ibid. Botwinick, Chapter 3.
19. ibid. Botwinick, p.131.
20. For a professional economists’ application of Botwinick’s work on wage differentials to race see Patrick L. Mason, “Race, Competition and Differential Wages,” Cambridge Journal of Economics 19 (1995), pp. 545-567.
21. David McNally, “The Dialectics of Unity and Difference in the Constitution of Wage-Labour: On Internal Relations and Working-Class Formation” Capital & Class, 39:1 (2015), pp. 131-146.
22. My approach to race as an ideology and a set of practices is rooted in the work of Barbara Jeanne Fields, in particular, “Slavery, Race and Ideology” ibid., pp. 110-113. Ideology is not the equivalent of propaganda—ideas produced by the media, schools, and the like and “imposed” on a passive population of working people. Nor is it equivalent to “doctrine”—a coherent and stable set of beliefs about the world. Instead, ideology is the “vocabulary of day-to-day action and experience”(p.111). Put another way, ideologies are the mental road maps of the lived experience of oppression.
23. Karl Marx, Capital, Volume I (Harmondsworth, England: Penguin Books, 1976), Chapter 6.
24. Marx, Value, Price, and Profit (Chicago: CH Kerr and Company, 1910), pp. 83-86.
25. Marx, Capital, I, p. 280.
26. The notion that structures both compel and enable agents to act in determinant ways is drawn from Alex Callinicos, Making History: Agency, Structure and Change in Social Theory (BRILL, 2004).
27. See Roediger and Esch, The Production of Difference, Chapter 5.
28. Johanna Brenner and Robert Brenner, “Reagan, the Right and the Working Class” Against the Current (Old Series) 1, 2 (Winter 1981), p30.
29. Harry Braverman, Labor and Monopoly Capital: The Degradation of Work in the 20^th Century (New York: Monthly Review Press, 1974). Unfortunately, most readers of Braverman’s masterpiece tend to equate deskilling with the homogenization of labor. Braverman himself was quite clear that the tendency to deskill work constantly differentiates workers.
30. ibid., Roediger, Class, Race and Marxism, p. 68.
31. See Vivek Chibber, “Rescuing Class from the Cultural Turn” Catalyst 1;1 (Spring 2017) .
32. See Michael Goldfield’s The Southern Key: Class, Race, and Radicalism in the 1930s and 1940s (New York: Oxford University Press, 2020.
33. Bruce Nelson’s Divided We Stand: American Workers and the Struggle for Black Equality (Princeton, NJ: Princeton University Press, 2001), Chapters 5-7 demonstrate how the CIO’s acceptance of departmental seniority set the stage for the reproduction of racial divisions among steelworkers and other organized industrial workers in the post-war period.