Look around and it is impossible to ignore the fact that our world is torn apart by brutal inequality. Some countries enjoy unimaginable material affluence while others suffer mass deprivation, with billions lacking basic necessities like nutritious food and clean water. The injustice stares every sane observer in the face. But where does it come from? This book shows that global inequality is not a natural phenomenon. It is not the inevitable feature of a normal economy. It is the result of the particular kind of economy that dominates our world. Capitalism.
The word capitalism tends to cause immediate confusion. For most people it calls to mind things like businesses, markets and trade: the ability of people to produce and sell things to one another. Who could possibly be against this? But in fact businesses, markets and trade existed for thousands of years before capitalism. Capitalism is a relatively recent system, having emerged in Western Europe only about 500 years ago. If one was to point to the single most important defining feature of this particular economic system, it would be that it is fundamentally anti-democratic.
Let me clarify what I mean. Yes, many of us live in electoral systems where we select political leaders from time to time. We have something approximating political democracy, as corrupt and imperfect as it may be. But when it comes to the economy, the system of production, not even the shallowest illusion of democracy enters. Production is controlled overwhelmingly by capital, meaning large corporations, the major financial firms, and the 1% who own the lion’s share of investable assets. Capital determines what gets produced, how our labour and resources shall be used, and for whose benefit. And for capital, the purpose of production is not to meet people’s needs, or to achieve social progress. The purpose is to maximize and accumulate profit – that is the overriding objective.
Capital seeks constantly increasing accumulation. To achieve this, it needs to cheapen the prices of inputs as much as possible (labour, land, energy, and materials), and maintain those prices at a low level. It also needs a constantly increasing supply of these inputs. This process cannot go on for very long within a bounded national economy. If you over-exploit your domestic working class, sooner or later you are going to face a revolution, or a crisis of overproduction. And if you over-exploit your domestic environment, eventually you will degrade the ecological base upon which all production relies.
To overcome these contradictions, capitalism always requires an “outside,” external to itself, where it can cheapen labor and nature with impunity and appropriate them on a vast scale; an outside where it can “externalize” social and ecological damages, where rebellions can be contained, and where it does not have to negotiate with local grievances or demands. This is where the colonies come in. From the origins of capitalism in the late 15th century, growth in the “core” of the world economy (Western Europe, the United States, Canada, Australia, New Zealand and Japan) has always depended on the mass appropriation of labor and resources from the “periphery” (Latin America, Asia and Africa). There was no lag between the rise of capitalism and the imperial project. Capitalism has always required an imperial arrangement.
This was obvious during the first several hundred years of capitalist history, which I detail in this book. European colonizers went about destroying self-sufficient industries in the periphery and forcibly re-organizing production to serve consumption and accumulation in the core. Historians have documented that extraordinary quantities of value were siphoned out of the periphery and into the core, subjecting the former to deprivation, misery, and mass mortality while furnishing the latter with unprecedented wealth.
Then, in the middle of the 20th century, a revolution occurred. Anti-colonial movements succeeded in overthrowing their occupiers and immediately set about reclaiming their productive forces. Their objective was to organize production around local human needs and national development. And they met with remarkable success. But the core powers were not pleased. Sovereign development meant that people of the global South were producing for themselves and increasing their consumption of Southern resources. This reduced the share of resources available to the core – making these inputs more expensive – and capital accumulation became much more difficult to achieve.
To solve this crisis, the core powers – led by the US, Britain, and France – intervened. In many cases they used military force to overthrow independent governments and install compliant regimes in their place. On top of this, beginning in the 1980s, they also imposed structural adjustment programmes across the global South, which dismantled sovereign industries, re-cheapened labour and resources, and re-organized production around exports to the core in subordinate positions with global commodity chains. Structural adjustment restored the imperial arrangement without the need for occupation.
The result of this arrangement is that today – according to new empirical research that is not included in the main text of this book – the growth of affluence in the core continues to rely on a massive net-appropriation of labour, resources and goods from the global South, worth trillions of dollars per year.[1] The situation is quite extreme: the global South contributes 80% of the resources and 90% of the labour that fuels the capitalist world economy. But these productive capacities, which could be used to provision nutritious food, good housing, and healthcare for everyone in the region, are mobilized instead to churn out plantation crops and sweatshop products for corporations and consumers in the core.
Recent research has found that we have more than enough productive capacity to end poverty forever and ensure good lives for all 8 billion people on this planet – with even less resources and energy than we presently use, thus also achieving our ecological goals[2],[3] – if production was organized around human needs rather than capital accumulation. But to get there the global majority must win democratic control over the means of production. That is the fight. That is the future we must struggle to achieve. I hope this book brings inspiration toward that end.
Jason Hickel, March 2024
Written for the Korean translation of The Divide
[1] Hickel, J., Dorninger, C., Wieland, H., & Suwandi, I. (2022). Imperialist appropriation in the world economy: Drain from the global South through unequal exchange, 1990–2015. Global Environmental Change, 73, 102467.
[2] Millward-Hopkins, J., Steinberger, J. K., Rao, N. D., & Oswald, Y. (2020). Providing decent living with minimum energy: A global scenario. Global Environmental Change, 65, 102168.
[3] Vélez-Henao, J. A., & Pauliuk, S. (2023). Material requirements of Decent Living Standards. Environmental Science & Technology, 57(38), 14206-14217.