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Is the state necessary for modern capitalism?

+3 votes

(Related to If capitalism can't survive without a state then how do you explain the grey and black markets? Possibly relevant to the new question Impact of cryptocurrencies in anarchy?)

Many anarchists claim that capitalism is a product of and supported by the state. One line of argument here is the historical record, where states are repeatedly observed to introduce and maintain capitalist structures. (Several histories are available, I recommend Graeber's "Debt", if only because I read it and can't speak for other sources.)

The question is, to what extent is this still the case? To my eyes, modern capitalism has huge and powerful organizations that still exhibit neither the psychological status of a state nor perform some of the traditional functions. Is the role of the state in enforcing capitalist property rights still the essential foundation of the system? Was it ever? Or is it just one aspect of many, and perhaps of diminishing importance?

asked Dec 25, 2015 by Geomancer (690 points)

'To my eyes, modern capitalism has huge and powerful organizations that still exhibit neither the psychological status of a state nor perform some of the traditional functions.'

can you illustrate a bit what you're getting at here? like, perhaps give us example of those powerful organizations.

Capitalism and "free markets" and what not depend on rules established by the government. Without them, modern capitalism would fall apart or be less of what it is today. So, like they have laws established to keep it a afloat and less risky. They have a boatload of rules/laws to accomplish this, like private property, stable money/currency (government backed), limited liability laws, bankruptcy protection, banking regulations, insurance...etc, which are all dependent on the state enforcing them. If investors were held liable for the stuff they do, contracts weren't enforced, no patents/IP/copyright, no stable money supply...etc, capitalism wouldn't be the monster that it is.

So, yes, modern capitalism still is dependent on the state, as far as I can tell. Don't know if this is what you were asking or not. This stuff hurts my brain way too much.

i would definetly like to see more responses to this one, but as human is alluding to, the state certainly controls many of the major aspects of capitalism...and when you die, if you don't have anyone in your will, well, guess who takes your property?
that's partly why i asked Geomancer to elaborate. i cannot think of a major organization which has no ties to the state, psychologically or otherwise. churches and 'private' schools, for example, readily teach the commodification of the world, the values of 'progress,' and so on. so for me the question's a bit unclear.

there is no question in my mind that capitalism could never have developed as it has without the state. and vice versa.

but when i think about this question in the current context, my mind goes directly to this:

what functions does the state provide that could not be provided by the "free market" and private enterprise?

muscle and protection of private property? nope, they've got that covered: private security, "police" forces and mercenary "armies" abound.

laws and regulations? the free market doesn't want 'em, they'd say "good riddance". or they'd "self regulate" - hahahahaha...

research and development? not a problem. sure, the capitalists would hate that there'd be no taxpayer money to massively subsidize the r&d that leads to their profitable products, but they'd figure that out. probably a bit less r&d is all.

centrally controlled currency? the fed is a privately owned enterprise already, if i am not mistaken. [edit: it is actually a complex combo of public and private. the fed banks themselves are private.]


the relationship between the state and capital is so tightly integrated that it is difficult to imagine one without the other. but if i approach it from the perspective of my (bolded) question above, i think there is some argument to be made that capitalism might be able to survive without the state. i just don't see it happening, and i surely don't see capitalists choosing to take on all the "responsibilities" that the state currently takes on (it would deeply cut their profits, and shift their objectives, for some period).  but could they if they were forced to?

i am no economist, nor a political scientist, so my thoughts are not based on either area of theory; just observation of the world over the past 55 years.

what was interesting to me about this question is that I feel like with the appropriate brainwashing, culturalization, socialization ect, i feel that anarcho-capitalism is an entirely possible thing, if the correct political events occurred ("correct" from the anarcho-capitalist perspective), then a more diffuse, stateless version of our current society is possible.

it's questions like these that reveal the diversionary political nature of anarcho-capitalism...you could just as easily argue that rather than the state having control of all business affairs that the state doesn't have control over that much, but is just the most successful corporate institution. It's sounds kind of silly, but true...i don't see how the world could be me anarcho-capitalist than it already is
I don't think capitalists would really want ancapistan to become a reality. Fraud and scams would run amok and investors would have zero protection, making everything they did insanely risky. It'd probably break within a few months.

Then again, ancaps tend to have less of an understanding of economics than I, and fail to understand self-regulating and laissez-faire both involve a government/state to ensure things run somewhat smoothly.
that's very true, the dollar only maintains its value because the government forces financial institutions to sort of "play by the rules", i was thinking about how useless banks would become if all their activities would become totally de-regulated

what an absurd world we live in, where investment banks gamble on nothingness and actually believe they're doing something useful! You don't have to know anything about economics to understand that all they do is rip off big corporations


fucking love it!

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