Not really. Capitalism is when owners of capital employ workers to use that capital to create goods and services which they sell to generate a profit. In capitalism the capitalists own the means of production. In feudalism they don’t have to care about production, they just own the land and then charge rent.
Adam Smith is notorious for his support of capitalism, but he was extremely critical of rents. The “free market” he talked about wasn’t one that was free of any government regulation, it was free of rents. You don’t have to do any work to get rent, you just have to own something. And rent gets worse when the owners of that something have a monopoly.
Imagine a capitalist who leases a textile factory and fills it up with workers earning minimum wage. Trucks drive up to one side of the factory and drop off spools of yarn, out the other side come sweaters which are sold for a big mark-up. The capitalist can do things like monitor his workers and fire them for taking more than 5 minutes to use the bathroom, or he can demand they work night shifts during holiday season to maximize his profits. The key thing here is profits – the amount left over after subtracting the costs from the revenues.
Now imagine the feudal landlord who owns the land that the factory uses. He doesn’t care if the factory is profitable or not, all he cares about is that it’s on land he owns, and he demands that he is paid rent for the use of his land. Maybe climate change means that sweaters stop selling so well, so the capitalist’s profits start to disappear. The feudal landlord doesn’t have to care. It’s his property, and the person leasing his property has to pay rent.
Feudalism led to the Irish potato famine. Even during the famine, Ireland was exporting food to England because the feudal landlords required their payment, even if the Irish were unable to feed themselves.
The modern world is looking more and more like feudalism and less and less like capitalism. Amazon rose to prominence using capitalism. It made profits when people ordered things online. The cost to buy those goods wholesale then pack and ship them to individual buyers was less than the price people paid for that service. In the early days, every product listed on Amazon’s website was sold by Amazon. Anything else would have been absurd. And, of course, Amazon wasn’t selling search ads on its website. It was in the business of selling goods, so when you searched for “cat beds”, it wanted to sell you a cat bed. Amazon had to compete with other rival websites that sold things online, as well as with physical stores like Wal*Mart.
These days, Amazon has transitioned from a capitalist enterprise to a feudal landlord. They forced local businesses to close. They bought up their online competition. Nowadays, they don’t make much of a profit on their store, they make rent by selling space on their search results page. Amazon makes much more money by selling space on its search results page for “cat beds” than from selling people cat beds. Because Amazon is a choke point through which most online commerce flows, Amazon gets to raise the rent it charges for space on that search results page to absurd levels.
Whether or not you hate capitalism, I think it’s clear that feudalism is much worse.
In feudalism they don’t have to care about production, they just own the land and then charge rent.
This is not the definition of feudalism. Feudalism is complex and varied, but the common theme in it is reciprocal obligations. These obligations do not exist among direct parties in the current capitalist system.
Everything that you say is feudal about Amazon, is definitively capitalist. Cornering a market is capitalist. You don’t stop being a capitalist when you use non-capital assets as a part of your business model. Real estate companies are still capitalist even though they deal in real estate. Ad space, SaaS, these things operate in a capitalist framework. Adobe isn’t receiving foodstuffs from graphic designers, and it isn’t granting free licenses to win the coordination of a militia. There is no clergy, nor manoralism binding the stakeholders.
It’s also probably worth pointing out that Adam Smith’s writing is primarily descriptive, not prescriptive. He had criticisms, yes, but those are not what are considered foundational about nor integral to his work. Prescriptive exploitation of the system he observed is capitalism as it actually exists. Rent is charged because it is conducive to the capitalist, regardless of the effect it has on larger society over long time periods. Externalizing costs is likewise conducive to the capitalist participant.
Whether or not you hate capitalism, I think it’s clear that feudalism is much worse.
With the research that has come out in the past several decades, I’m not sure that it is clear at all. Even a simple analysis will show that inequality is higher under capitalism, and class mobility has a worse track record under capitalism (feudalism gave birth to the bourgeoisie, for better and for worse). I think what’s more important and more clear, is that 1. neither economic system is compatible with our current challenges such as ecological destruction, and that 2. neither will lead to equality.
Of course it’s not “the definition” of feudalism. But, being paid for the use of something you own is a key aspect of feudalism.
the common theme in it is reciprocal obligations
Suuuure… I’m sure that’s how the feudal lords framed it for their subjects. But, when push came to shove, if you didn’t work the lord’s fields he could have you whipped. If he failed to protect you from brigands you could… complain quietly to the other serfs? The lord would only need to fear aristocrats higher up the food chain than themselves.
Everything that you say is feudal about Amazon, is definitively capitalist
No, it may be happening in an economy where capitalism is one of the main economic systems, but it definitely isn’t capitalism.
Real estate companies are still capitalist even though they deal in real estate.
Take away the company from this example. Is an individual a capitalist if they own land and receive rent from people using that land? How is that different from a feudal lord who owns land and demands rent?
Take away the company from this example. Is an individual a capitalist if they own land and receive rent from people using that land? How is that different from a feudal lord who owns land and demands rent?
Yes, absolutely, if the landowner is rent-seeking and using the proceeds for their own benefit - including expansion of their business. The modern economy alienates participants and their dependency on direct relations to other participants. Currency is the primary mechanism for this: the landowner’s proceeds are not coming in the form of grain and defense; it is coming in the form of a fungible debt token. With this currency he may go to his lessee, a farmer, a futures market, or a store to get his grain. The maintenance required to construct and maintain housing is relatively capital-intensive. Often, what landowners have done is to contract out anything that involves direct ownership and usage so as to reduce cost. They bring in HVAC companies, and pool companies if they are large enough to not be a sole (capital-utilizing) proprietor operation.
And this transition from the sole proprietor barely eeking out enough to buy the next house on the street to rent out (this is how all of the landlord circles speak, they are clearly trying to accrue capital to convert to assets to leverage debt to accrue capital etc…) to the corporate management company contracting every aspect of operations, is perfectly illustrative of what the real evolution has been. It is not capitalism to feudalism, rather it is the same financialization that led to deindustrialization in developed nations. When a landowner’s operation is successful enough, they distance themselves from operations as a corporate board does from its executive team. The landowner hires laborers and accountants to run their capitalist business that is personally profiting them and allowing them to gain greater and greater privileges. The end game of this is that their rent-seeking has turned into naught but numbers flickering in front of them on a screen. They have externalized the costs of capital and maintenance. The capital and maintenance is still utilized, its just by the landowner’s contractors instead of the landowner. At some point this landowner stops looking like a landowner and more like your typical business person looking to corner a market. But their business is still being a landowner, and nothing in the landowner-lessee relationship has changed except degrees of separation (and prices going up to keep all of the contractors employed at a profit to their own business owners).
Most landowners I see speaking with each other are talking about what stocks, ETFs, bonds, and other assets they should be buying - in the perspective of how to maximize their profits. Is Blackrock not capitalist because it only deals with financialization of factories and not the factory operations themselves? No, they are still capitalist and their shares signify their stake of ownership.
The landowners are not maintaining their realms for a mutual if unequal benefit. They are maintaining their assets to succeed in the game of capitalism. It’s not exactly easy to extricate oneself from a capitalist world. Even the homeless and possessionless must deal with it; they still go to the store to legally acquire things with currency. They don’t get to work on a farm and keep a portion of the harvest to feed themselves with as an accepted part of the social contract.
You can define capitalism and feudalism however you like, don’t let me stop you any further. Maybe you’ll strike upon an enlightening realization based on this novel framework. Just be aware that you aren’t using the common definitions.
The working class has all the power, they just don’t know it. But what good is all the power if it doesn’t give you more? If everybody on this world would double their resource usage, global warming would just accelerate.
If it were feudalism the proles would now have more power as peasantry.
But the working class continues to have less and less power as capital accrues into fewer and fewer hands - this is still capitalism.
Not really. Capitalism is when owners of capital employ workers to use that capital to create goods and services which they sell to generate a profit. In capitalism the capitalists own the means of production. In feudalism they don’t have to care about production, they just own the land and then charge rent.
Adam Smith is notorious for his support of capitalism, but he was extremely critical of rents. The “free market” he talked about wasn’t one that was free of any government regulation, it was free of rents. You don’t have to do any work to get rent, you just have to own something. And rent gets worse when the owners of that something have a monopoly.
Imagine a capitalist who leases a textile factory and fills it up with workers earning minimum wage. Trucks drive up to one side of the factory and drop off spools of yarn, out the other side come sweaters which are sold for a big mark-up. The capitalist can do things like monitor his workers and fire them for taking more than 5 minutes to use the bathroom, or he can demand they work night shifts during holiday season to maximize his profits. The key thing here is profits – the amount left over after subtracting the costs from the revenues.
Now imagine the feudal landlord who owns the land that the factory uses. He doesn’t care if the factory is profitable or not, all he cares about is that it’s on land he owns, and he demands that he is paid rent for the use of his land. Maybe climate change means that sweaters stop selling so well, so the capitalist’s profits start to disappear. The feudal landlord doesn’t have to care. It’s his property, and the person leasing his property has to pay rent.
Feudalism led to the Irish potato famine. Even during the famine, Ireland was exporting food to England because the feudal landlords required their payment, even if the Irish were unable to feed themselves.
The modern world is looking more and more like feudalism and less and less like capitalism. Amazon rose to prominence using capitalism. It made profits when people ordered things online. The cost to buy those goods wholesale then pack and ship them to individual buyers was less than the price people paid for that service. In the early days, every product listed on Amazon’s website was sold by Amazon. Anything else would have been absurd. And, of course, Amazon wasn’t selling search ads on its website. It was in the business of selling goods, so when you searched for “cat beds”, it wanted to sell you a cat bed. Amazon had to compete with other rival websites that sold things online, as well as with physical stores like Wal*Mart.
These days, Amazon has transitioned from a capitalist enterprise to a feudal landlord. They forced local businesses to close. They bought up their online competition. Nowadays, they don’t make much of a profit on their store, they make rent by selling space on their search results page. Amazon makes much more money by selling space on its search results page for “cat beds” than from selling people cat beds. Because Amazon is a choke point through which most online commerce flows, Amazon gets to raise the rent it charges for space on that search results page to absurd levels.
Whether or not you hate capitalism, I think it’s clear that feudalism is much worse.
This is not the definition of feudalism. Feudalism is complex and varied, but the common theme in it is reciprocal obligations. These obligations do not exist among direct parties in the current capitalist system.
Everything that you say is feudal about Amazon, is definitively capitalist. Cornering a market is capitalist. You don’t stop being a capitalist when you use non-capital assets as a part of your business model. Real estate companies are still capitalist even though they deal in real estate. Ad space, SaaS, these things operate in a capitalist framework. Adobe isn’t receiving foodstuffs from graphic designers, and it isn’t granting free licenses to win the coordination of a militia. There is no clergy, nor manoralism binding the stakeholders.
It’s also probably worth pointing out that Adam Smith’s writing is primarily descriptive, not prescriptive. He had criticisms, yes, but those are not what are considered foundational about nor integral to his work. Prescriptive exploitation of the system he observed is capitalism as it actually exists. Rent is charged because it is conducive to the capitalist, regardless of the effect it has on larger society over long time periods. Externalizing costs is likewise conducive to the capitalist participant.
With the research that has come out in the past several decades, I’m not sure that it is clear at all. Even a simple analysis will show that inequality is higher under capitalism, and class mobility has a worse track record under capitalism (feudalism gave birth to the bourgeoisie, for better and for worse). I think what’s more important and more clear, is that 1. neither economic system is compatible with our current challenges such as ecological destruction, and that 2. neither will lead to equality.
Of course it’s not “the definition” of feudalism. But, being paid for the use of something you own is a key aspect of feudalism.
Suuuure… I’m sure that’s how the feudal lords framed it for their subjects. But, when push came to shove, if you didn’t work the lord’s fields he could have you whipped. If he failed to protect you from brigands you could… complain quietly to the other serfs? The lord would only need to fear aristocrats higher up the food chain than themselves.
No, it may be happening in an economy where capitalism is one of the main economic systems, but it definitely isn’t capitalism.
Take away the company from this example. Is an individual a capitalist if they own land and receive rent from people using that land? How is that different from a feudal lord who owns land and demands rent?
Yes, absolutely, if the landowner is rent-seeking and using the proceeds for their own benefit - including expansion of their business. The modern economy alienates participants and their dependency on direct relations to other participants. Currency is the primary mechanism for this: the landowner’s proceeds are not coming in the form of grain and defense; it is coming in the form of a fungible debt token. With this currency he may go to his lessee, a farmer, a futures market, or a store to get his grain. The maintenance required to construct and maintain housing is relatively capital-intensive. Often, what landowners have done is to contract out anything that involves direct ownership and usage so as to reduce cost. They bring in HVAC companies, and pool companies if they are large enough to not be a sole (capital-utilizing) proprietor operation.
And this transition from the sole proprietor barely eeking out enough to buy the next house on the street to rent out (this is how all of the landlord circles speak, they are clearly trying to accrue capital to convert to assets to leverage debt to accrue capital etc…) to the corporate management company contracting every aspect of operations, is perfectly illustrative of what the real evolution has been. It is not capitalism to feudalism, rather it is the same financialization that led to deindustrialization in developed nations. When a landowner’s operation is successful enough, they distance themselves from operations as a corporate board does from its executive team. The landowner hires laborers and accountants to run their capitalist business that is personally profiting them and allowing them to gain greater and greater privileges. The end game of this is that their rent-seeking has turned into naught but numbers flickering in front of them on a screen. They have externalized the costs of capital and maintenance. The capital and maintenance is still utilized, its just by the landowner’s contractors instead of the landowner. At some point this landowner stops looking like a landowner and more like your typical business person looking to corner a market. But their business is still being a landowner, and nothing in the landowner-lessee relationship has changed except degrees of separation (and prices going up to keep all of the contractors employed at a profit to their own business owners).
Most landowners I see speaking with each other are talking about what stocks, ETFs, bonds, and other assets they should be buying - in the perspective of how to maximize their profits. Is Blackrock not capitalist because it only deals with financialization of factories and not the factory operations themselves? No, they are still capitalist and their shares signify their stake of ownership.
The landowners are not maintaining their realms for a mutual if unequal benefit. They are maintaining their assets to succeed in the game of capitalism. It’s not exactly easy to extricate oneself from a capitalist world. Even the homeless and possessionless must deal with it; they still go to the store to legally acquire things with currency. They don’t get to work on a farm and keep a portion of the harvest to feed themselves with as an accepted part of the social contract.
You can define capitalism and feudalism however you like, don’t let me stop you any further. Maybe you’ll strike upon an enlightening realization based on this novel framework. Just be aware that you aren’t using the common definitions.
The working class has all the power, they just don’t know it. But what good is all the power if it doesn’t give you more? If everybody on this world would double their resource usage, global warming would just accelerate.
You can’t fire a slave, slaves has to be sold.