New Preface to the Divide

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