Chapter 4
How Capitalism Undermines Human Values
Anticapitalism fundamentally claims that capitalism impedes the fullest realization of equality, democracy, and community. While capitalism faces other criticisms-that it creates instability, wastes resources, damages the environment, and fuels militarism-Wright focuses on how capitalism undermines core human values.
Capitalism inherently generates massive inequality in access to the conditions needed for flourishing lives. This inequality violates social justice in two ways: it systematically denies equal opportunity (with advantages flowing to those born wealthy) and creates absolute deprivation even in rich countries, where millions face economic precarity, hunger, and poverty-related health problems. These inequalities aren't accidental but intrinsic to capitalism's mechanisms.
At capitalism's core lies the fundamental inequality between capital owners and non-owners, forcing most people into labor markets where they need jobs more than employers need them. This power imbalance creates exploitation-a causal relationship where the rich are rich partly because the poor are poor, as capital owners' income derives from exploiting workers' labor. Market competition naturally amplifies initial inequalities as advantages accumulate over time, creating winners and losers in both business and labor markets. Additionally, capitalism's volatility and crises disproportionately harm those at the bottom, as the wealthy can insure themselves against risks far better than the poor.
Capitalism's dynamic innovation constantly destroys jobs and sometimes entire sectors. While this creates new jobs, there's no inherent mechanism ensuring displaced workers can access them-retraining takes time and resources, geographic relocation disrupts social networks, and new jobs may require entirely different skills. The result is sharp inequality between winners and losers in capitalist development, extending beyond income to access to meaningful, fulfilling work.
While capitalism historically enabled expansions of freedom and democracy, it simultaneously creates severe deficits in these values. Private ownership rights exclude crucial decisions (like factory relocations) from democratic control despite their profound community impacts. The threat of capital flight forces politicians to prioritize "business climate" over other concerns. Wealth creates unequal political access through campaign contributions, lobbying, and elite networks. Capitalist workplaces function as dictatorships where owners command employees. Finally, economic inequality undermines "real freedom"-the ability to say no and pursue one's life plans.
Capitalism fosters motivations that corrode community and solidarity. The driving forces of greed and fear shape how people interact in market societies. As philosopher G.A. Cohen notes, under capitalism, others are seen either as "possible sources of enrichment" or "threats to one's success"-destructive ways of viewing fellow humans despite our habituation to them. These motivations aren't simply individual character flaws but are systematically fostered by competitive markets. Even personally generous CEOs make profit-maximizing decisions that harm communities. Capitalist culture promotes competitive individualism (measuring self-worth through comparison) and privatized consumerism (believing life satisfaction depends on increasing personal consumption while devaluing public goods).
Chapter 5
Strategic Pathways Beyond Capitalism
Most social change happens unintentionally, as the cumulative effect of unplanned human actions. Strategic social change, by contrast, requires deliberate, intentional action toward viable goals. Critics like Hayek argue that attempting to engineer alternatives to capitalism is futile, as negative unintended consequences will inevitably overwhelm intended outcomes. Yet capitalism's destructiveness demands response. What's needed is an understanding of anticapitalist strategies that avoids both wishful thinking and disabling pessimism.
Five distinct strategic logics have historically shaped anticapitalist struggles: smashing capitalism, dismantling capitalism, taming capitalism, resisting capitalism, and escaping capitalism. Though these strategies intermingle in practice, each represents a different response to capitalism's harms.
The revolutionary strategy sees capitalism as fundamentally unreformable. While small reforms may temporarily improve lives when popular forces are strong, these improvements remain fragile and reversible. The only hope is to destroy capitalism through a decisive rupture in the existing power system, then build an alternative from its ashes. This vision animated twentieth-century revolutionaries, infusing struggles with hope and sometimes culminating in seizures of state power. However, these revolutions never created the democratic, egalitarian alternatives they promised. The evidence suggests that system-level rupture doesn't work as a strategy for social emancipation.
Some anticapitalists shared the critique and goals of revolutionaries but rejected the plausibility of rupture. Instead, they envisioned socialism emerging through state-directed reforms that incrementally introduced socialist elements from above. This approach involved an extended transition period with a mixed economy where capitalist and socialist relations coexisted. However, capitalism's postwar dynamism, coupled with ideological offensives against socialism, halted this momentum. By the late twentieth century, far from expanding, state-directed sectors became vulnerable to attack. Under neoliberalism, privatization replaced nationalization as the dominant agenda.
Unlike strategies that aim to replace capitalism with socialism, taming capitalism seeks to neutralize its harms while leaving the basic system intact. This became the dominant approach of social democratic parties in the second half of the twentieth century. The argument is straightforward: Capitalism naturally creates significant harms, but these can be counteracted through well-designed state policies. This approach doesn't eliminate capitalism's harmful tendencies but counteracts their effects-like treating symptoms rather than curing the disease. During capitalism's "golden age" (roughly 1945-1975), social democratic policies implemented comprehensive social insurance, extensive state-provided public goods, and regulatory regimes addressing negative externalities of market behavior.
Chapter 6
Eroding Capitalism: A New Strategic Vision
Wright proposes "eroding capitalism" as a new strategic configuration that combines bottom-up civil society initiatives with top-down state-centered strategies. This erosion strategy recognizes that no economy has ever been purely capitalist. Real economic systems combine capitalism with many other ways of organizing production and distribution: state provision, family relations, community networks, cooperatives, nonprofits, peer-to-peer networks, and more.
The ecosystem analogy helps clarify this vision: just as an alien species might be introduced into a lake ecosystem and eventually displace dominant species, emancipatory forms of noncapitalist economic activity can be introduced into capitalism's ecosystem. These alternatives can grow within niches, protected and expanded through deliberate strategy, until they potentially transform the entire system.
This approach combines top-down state action (changing rules to protect and facilitate alternatives) with bottom-up initiatives from communities. While no political movement explicitly embraces this full strategic complex, elements appear in parties like Syriza, Podemos, and progressive currents within established parties.
The strategy is both enticing (we can build "real utopias" within capitalism's interstices) and far-fetched (could these alternatives ever truly displace powerful capitalist corporations?). To demonstrate its viability, we must address the substance of emancipatory alternatives, the problem of the capitalist state, and identifying the necessary collective actors for this strategy.
Chapter 7
Socialism as Economic Democracy
Until the late twentieth century, anticapitalists had a clear alternative vision called "socialism"-generally understood as state ownership of production means and comprehensive planning replacing markets. By century's end, the failures of Soviet-style economies discredited this highly statist model, leaving anticapitalists with a critique of capitalism but less clarity about viable alternatives.
To rethink socialism, Wright focuses on how power is organized within economic structures. Power is simply the capacity to produce effects in the world. In economic systems, three forms of power are particularly important:
1. Economic power: based on control of economic resources
2. State power: grounded in control of rulemaking and enforcement over territory
3. Social power: rooted in the capacity to mobilize people for cooperative, voluntary collective actions
In this framework, we can distinguish three economic systems:
• Capitalism: resources allocated through economic power (owners of capital)
• Statism: resources allocated through state power (administrative mechanisms)
• Socialism: resources allocated through social power (collective decision-making)
These are "ideal types"-actual economies are complex ecosystems combining all three power relations in varying degrees. An economy is "capitalist" when capitalist relations dominate, "statist" when state power dominates, and "socialist" when social power dominates.
Markets exist in all three systems-the issue isn't markets versus planning, but how different forms of power shape market operations. What we need is a democracy-conforming market, not what Angela Merkel called a market-conforming democracy. Socialism should be viewed not as a binary opposite to capitalism but as a process of expanding and deepening democratic organization of economic activities.
Chapter 8
Building Blocks of a Democratic Socialist Economy
Rather than proposing a unitary structure for democratic socialism, Wright envisions a diverse ecosystem involving participatory planning, public enterprises, cooperatives, democratically regulated private firms, markets, and other institutional arrangements. The optimal configuration would emerge through experimentation and democratic deliberation, with inevitable trade-offs between different values.
Unconditional basic income (UBI) represents a transformative building block: every legal resident would receive an income sufficient to live above the poverty line without any work requirements or conditions. Beyond eliminating poverty and reducing inequality, UBI would fundamentally transform people's relationship to the capitalist labor market by making it much easier to say "no" to employment. This would enable people to pursue alternative economic activities like worker cooperatives, artistic work, small-scale farming, caregiving, and social economy initiatives.
A cooperative market economy includes diverse organizations: consumer cooperatives, credit unions, producer cooperatives, housing cooperatives, solidarity cooperatives, and worker cooperatives. These enhance economic democracy because they are internally governed democratically and, being geographically rooted, their capital is less mobile and thus more easily subjected to democratic regulation. Cooperatives already constitute a significant element in existing economies-over a third of Europeans and North Americans hold membership in some cooperative, generating 7% of GDP in Europe and 4% in North America.
The social and solidarity economy encompasses economic activities anchored in communities with egalitarian values and social justice missions. Beyond just cooperatives, it includes nonprofits, mutual societies, voluntary associations, and social enterprises. In crisis situations like Argentina in 2000 or Greece in 2009, these activities flourish: time banking, community kitchens, tool libraries, gardens, and free clinics. Quebec demonstrates how this approach can thrive even in stable economies, with daycare centers, eldercare services, housing projects and more.
Chapter 9
Beyond Markets: New Economic Institutions
While markets would remain significant in democratic socialism, nonmarket economic activity would play a much larger role than in capitalism. The balance between market and nonmarket forms would evolve through democratic deliberation, but nonmarket provision would certainly expand dramatically.
State provision need not mean centralized bureaucracies-it can include decentralized production involving local communities and state-social economy partnerships. Democratic deliberation would determine which services are best produced through markets, directly by the state, or by state-funded non-state organizations. State provision would likely include healthcare, childcare, education, infrastructure, and public utilities, potentially encompassing over 50% of economic activity. When services are state-provided, pricing becomes a political decision rather than market-determined. Many services with strong positive externalities, like public transportation, would likely be free to users.
Peer-to-peer collaborative production could play a significant role in a democratic socialist economy. In the twenty-first century, computer-driven manufacturing using 3-D printers and automated tools will reduce economies of scale, enabling small-scale cooperative producers to manufacture on a made-to-order basis. P2P networks could create globally accessible libraries of free, nonproprietary downloadable designs that anyone with the necessary means of production could use.
Intellectual property rights, especially patents, are foundational to capitalist production but have mixed effects on innovation. While patents provide incentives for innovation by protecting inventors' investments, they also slow down diffusion and improvement of innovations. Most importantly, patents enable corporations to restrict access and extract enormous profits, as seen in the pharmaceutical industry where drug prices vastly exceed production costs. In a democratic socialist economy, scientific and technical knowledge would primarily be treated as part of a knowledge commons, with only a residual role for private intellectual property rights.
Chapter 10
The State and Democratic Transformation
Many skeptics of the "eroding capitalism" strategy point to the capitalist state as the fundamental obstacle. They argue that if emancipatory economic alternatives ever threatened capitalism's dominance, the state would crush them, or if anticapitalists democratically gained state control, pro-capitalist forces would destroy democracy itself (as happened in Chile in 1973).
Critics of capitalism traditionally view the state as designed to reproduce capitalism through two interconnected mechanisms: first, the state is controlled by elites linked to the capitalist class who block challenges to capitalism; second, the state's institutional structure has built-in biases favoring capitalist interests. These reinforce each other-elites make decisions hostile to anticapitalist projects, and even when anticapitalist actors gain power, they can't sustainably pursue anticapitalist policies because of structural constraints.
However, just as economic systems are messy combinations of capitalist and noncapitalist relations, the "capitalist state" is an ideal type. Actual states consist of heterogeneous, loosely coupled systems with varying degrees of pro-capitalist bias. Democracy introduces a particularly important contradiction in the state's class character-while electoral rules may generally constrain class struggles in ways supporting capitalism, genuine democratic competition creates tensions and uncertainties.
Two major trends offer grounds for optimism about state initiatives that could erode capitalist dominance. First, global warming will likely end neoliberalism by requiring massive state-provided public goods and planning that the market cannot deliver. Second, technological automation is creating employment challenges that markets alone cannot solve. While these trends could lead to authoritarian responses, they might instead revitalize democracy through progressive mobilizations that expand democratic-egalitarian economic forms alongside capitalism.
Chapter 11
Building Collective Power for Transformation
The most vexing challenge for eroding capitalism is creating collective actors with sufficient coherence and capacity to sustain the project. Having a solid critique of capitalism, compelling alternatives, and strategic maps isn't enough-we need political agents capable of implementing these strategies.
Agency refers to people as "conscious, reflecting initiators of acts in a structured, meaningful world." Though people act within constraints from social structures and internalized beliefs, they aren't robots. Agency applies to both individuals and collectivities, though collective actors are more complex-they're organizations, associations, and coalitions through which people coordinate action, not abstract entities like "classes." These collective actors are essential for emancipatory transformation since effective strategy against powerful institutions requires coordinated action rather than relying on unintended side effects of individual behaviors.
Identities help us understand how people classify themselves and others through salient life characteristics. Shared identities facilitate collective action by creating solidarity that overcomes free-riding problems and builds trust. Identities forged through experiences of inequality and domination are especially important for emancipatory movements, and can evolve through the very experience of struggle.
While connected to identities, interests are distinct-they refer to what would objectively make a person's life better along important dimensions. People can be mistaken about their interests, which is the essence of "false consciousness"-incorrect beliefs about how the world works leading to incorrect views about what would benefit them.
Values represent beliefs about what is good-both in terms of personal behavior and social institutions. Values have always been crucial to emancipatory struggles, motivating people to act beyond self-interest-like white students registering Black voters during Freedom Summer or the anti-apartheid movement. Values can become powerful sources of motivation and identity, especially when integrated into emancipatory ideologies that combine explanations of how the world works with alternatives and moral commitments.
Most people are absorbed in the practical demands of everyday life-family, work, community-leaving little time for political engagement. This private/public divide is worsened in consumerist societies where personal happiness is tied to consumption levels and competitive labor markets. Historically, civic associations like labor unions and churches have helped bridge this gap by integrating politics with daily life.
While class remains central to anticapitalist strategy, the working class hasn't developed the homogeneous identity Marx predicted. Instead of simplifying, class structures have become more complex, fragmenting the shared sense of fate among workers. Despite income polarization captured in slogans like "we are the 99%," workers' experiences vary enormously in earnings, job security, autonomy, education requirements, and creativity.
The formation of effective politically organized collective actors is essential for eroding capitalism. While there's no general formula for effective anticapitalist organizing, several guidelines emerge: values should be central to progressive politics; identity politics should be integrated within broader emancipatory politics; democracy should be emphasized as a unifying objective; and remembering that eroding capitalism depends on both state action and building alternative economic practices from below.
Chapter 12
A Legacy of Hope and Pragmatic Vision
In the early hours of January 23, 2019, Erik Olin Wright died at seventy-one, at the height of his influence. Even while battling acute myeloid leukemia for ten months, he remained committed to fighting for a better future-writing to his grandchildren, caring for his students, worrying about his department at the University of Wisconsin, and ensuring the future of the Havens Center he founded. To his last breath, he remained an optimist and a "real utopian," encouraged by the new generation of socialists.
Wright's intellectual journey took him from Harvard and Oxford to Berkeley, where Marxism transformed sociology for his generation. His groundbreaking work merged innovative theory with empirical research, creating maps of class structure across fifteen countries. As part of the Analytical Marxist group, Wright sought to produce rigorous social science free from philosophical "mumbo jumbo."
In 1991, he began his journey into "real utopias"-seeking out institutional forms within capitalism whose principles contradicted capitalist logic. His 2010 book "Envisioning Real Utopias" presented socialism not as state planning but as empowerment of civil society through participatory budgeting, citizen assemblies, universal basic income, and cooperatives. His final work, "How to Be an Anticapitalist in the Twenty-First Century," organizes critique around three value pairs: equality/fairness, democracy/freedom, and community/solidarity.
Unlike Marx, Wright concludes that class alone is too fragmented to build something new-transformation requires moral vision propelled by equality, democracy, and solidarity. His work stands as both a rigorous critique of capitalism's failures and a pragmatic roadmap for building something better, step by step, through the cracks and contradictions of the existing system.
