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Comment by lanternfish | Hacker News Reader

You can make a serious of arguments about how the nature of industry in a country ultimately derives from historical and geological factors which can be causally divorced from genetic traits.

I don't think any critical theorists would consider the statement 'industrial comparative advantages exist across countries' to be racist - or even something like neo-imperialist.

You could claim that capitalism is flawed due to the way it distributes labor against these historical differences (many of which were propogated along racial lines due to colonialism), but I don't think the analytical claim _under_ capitalism holds any normative merit.

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Capitalism was built on these racist systems like colonialism and chattel slavery. You can try to separate them, but fundamentally the GP is entirely right that the reason financial services are "suited" to britain is because of centuries of brutal exploitation of countries that are "suited" to resource extraction. Neither of these things are inherently true of the people or the places, they are direct consequences of particular political structures and violent intervention.

In the end, it's extremely profitable under capitalism for some people to be considered sub-human. That's not an accident, it's the game. Capitalism has never existed independent of this premise.

> Capitalism was built on these racist systems like colonialism and chattel slavery ... centuries of brutal exploitation of countries that are "suited" to resource extraction.

Daron Acemoglu's Why Nations Fail handily disproves that argument. Latin America, and Spanish colonization in general, was built on those exact same things to a far greater extent and for a longer span of time; and today it is, by and large, a thoroughly anti-capitalist economic basket-case. The two are only loosely related to each other, and the correlation might easily be in the negative.

Maybe it does but if so you haven't conveyed it very well. Are you arguing that Latin America is not exploited for its resources under the global system of capitalism? Because that's a pretty absurd position to take. You might even imagine how that exploitation could lead to revolutionary politics and the current state of affairs there.

But even if we take that as a given, "it didn't work uniformly in all directions in the same way" is not an argument that the relationship doesn't exist.

My assertion is that capitalism has always coexisted with systems that treat some people as sub-human, so can't be completely disentangled from them. You're going to have to work a lot harder to "disprove that argument," imo.

The earlier comment in this thread was arguing that "the global system of capitalism" could explain why Britain and its colonies are uniquely suited to providing highly-developed financial services. Now you're saying that the same "global system of capitalism" explains extractive systems in Latin American colonies. These are polar opposites in terms of outcomes, how can they possibly be explained by the same factor? Why Nations Fail tackles the same stylized facts in a far more nuanced manner, examining local policy choices (often exploitive ones) as often more relevant than fuzzy global "systems".

You aren't characterizing either of my posts in a way that I recognize as anything like what I'm asserting. I'll boil it down:

- Britain is not "inherently suited" to providing financial services, it built that suitability through violence and extracting wealth through colonialism and racist systems like slavery (which, though abolished in britain itself, it still remained a central figure in financially supporting the trade long after).

- Countries "suited to" resource extraction are so suited because of brutal campaigns by colonial systems. The character of how this campaign was undertaken is somewhat different in Africa, the Americas, and the middle and far easts, but the overall nature of it was roughly the same.

- Capitalism emerged in the aftermath and continued exploitation of this relationship, through to today, for its entire existence.

I do not say that "capitalism explains" anything. I say that "capitalism was born from these things, and they are inextricably intertwined". Not necessarily in a causal relationship (though in many complicated ways there's plenty of blame to be leveled), but simply because it has never existed without the existence of classes considered, in some way, to be sub-human (though the ways we degrade people to this state now are more nuanced than they were in the explicit chattel slavery days).

> it has never existed without the existence of classes considered, in some way, to be sub-human (though the ways we degrade people to this state now are more nuanced than they were in the explicit chattel slavery days).

You could easily apply that sentence to human history as a whole - the word "capitalism" is doing no work there. Even Russian kulaks, Chinese "counter-revolutionaries" and Cambodian intellectuals were considered sub-human; no human social system has ever fully escaped that pitfall.

Sure. And if you want to analyze those systems, I would hope you would also not try to pretend that that othering played no part in those systems either. I'm not the one trying to pull them apart like string cheese.

You're thinking of Mercantilism, which was pretty much the established economic model at the time of Adam Smith. As I explained in my post, Mercantilism subscribed to a zero sum view of trade and economic activity. For one side of a transaction to gain the other side must lose, which fits with the master/slave relationship perfectly.

Capitalism is basically what Smith was promoting. The idea that individuals owning their own property, exercising those property rights through buying and selling their property, associating freely in commercial enterprises (companies) and trading with each other freely could benefit each other economically. This was radical at the time. It's no accident that the ascendency of this concept of individuals trading freely coincided with the abolitionist movement and eventually British outlawry and suppression of the Atlantic slave trade.

Proto-Capitalists like Smith were vehemently against the monopolistic nationalised trading companies that operated imperial colonies as extractive enterprises. Smith himself, aside from opposing slavery on moral grounds, believed that slave labour would always be more expensive than free labour because a slave has no incentive to increase their productivity.

You are quite right to criticise colonialism as abusive and extractive, but that wasn't Capitalism.

I can assure you I'm not. I'm not really very interested in mercantilism, since it's not the system we live under today.

> You are quite right to criticise colonialism as abusive and extractive, but that wasn't Capitalism.

Colonialism never ended (in spite of the existence of an academic field called "post-colonialism"). The extractive relationships still exist, and are reflected in capitalist relationships. You can't just go "London's a great place to do finance!" and pretend there's nothing behind that. It's a great place to do finance because for hundreds of years, both before and after the emergence of the system we call capitalism, a significant portion of the entire world's wealth was syphoned by force into London. There's no way to abstract that away without becoming trite.

Right and that forceful siphoning of wealth was a result of mercantilist policies. Capitalism is simply taking the world as it existed and building on that. It didn’t create it though.

If the British Empire had actually been a true economically liberal capitalist system from the start it wouldn’t look anything like it does now. The USA would be part of the commonwealth because the mercantilist monopolistic constraint on the tea trade wouldn’t have happened, so no Boston Tea Party. India would have been hugely more developed and industrialised. The fact that it was prevented from doing so was a clearly mercantilist policy, restraining the free development of the domestic Indian economy along capitalist lines, sometimes by force. Adam Smith would have been appalled.

It was precisely the transition of the British Empire from a mercantilist to a liberal free trade capitalist economy that made the imperial system untenable and unnecessary.

I’m not in any way denying the head start imperialism gave us, but imperialism and capitalism are not the same thing, and were frequently at odds with each other. In fact the Whig and Tory political struggle of the time was in some ways one between pro capitalist (liberal) and pro imperial forces.

This is all still extremely irrelevant to the question of if capitalism is in some way disconnected from, or apart from, racist systems. "Who started it" is just completely academic and not at all interesting.

Also, colonialism and imperialism are not the same thing. I get the feeling you read "imperialism" in place of "colonialism" in my post, but I did not even mention imperialism.

You're quite right on your point about the distinction between imperialism and colonialism. I meant colonialism.

Something can exist alongside or in tandem with a system without being identical to or necessarily dependent on it. A great example is capitalism in China. Politically it is communist, yet it also has a huge capitalist economic sector. The capitalist economic system in China has raised hundreds of millions of people out of poverty, a feat no other economic system has even approached.

Japan is capitalist, is it also colonialist or based on racist exploitation? What about Sweden, or Germany, or South Korea? There are many capitalist countries that never had any significant empires or colonies, and certainly reaped extremely few economic benefits from them if any, that have done extremely well. What made them wealthy was industrialisation and capitalist economics.

Even the USA had barely any colonial presence, and any that it has had made almost no impact on it's economy which throughout it's history has been almost entirely driven by internal demand, and most of it's trade was with developed countries, not colonies. Yes it had mass slavery, but in fact ending slavery was hugely economically beneficial by allowing former slaves to emigrate north and take up jobs in the industrial belt.

Look, I'm not in any way denying that colonialist abuses were appalling, that we benefited from them, that there are lingering historical injustices that need to be faced up to. All of that is true. It's just got nothing to do with capitalist economics, which if anything actively contributed to the downfall of that system.

> Japan is capitalist, is it also colonialist or based on racist exploitation? What about Sweden, or Germany, or South Korea?

Yes to all of these, which have at some point in history had colonial holdings, except perhaps South Korea which has largely been a victim of colonial (and imperial) systems, even if they currently thrive under American protection.

As for the US, it is itself a colony, and the exploitation of people and resources on the continent built its wealth. That it managed to wrest away control of itself after much of the genocide undertaken to build it up was already done doesn't change that it was built on extraction of resources from the 'new' world to the 'old'. Some of them moved there and didn't want to send their money home anymore, but like... there were people on the island of Manhattan before it became the center of the finance world, and they're all but erased from history now.

And all of these countries continue to benefit from wealth taken from the global south today. The tools of coercion that keep this system going have changed, but they're still in effect.

Capitalism was built on wealth extracted through colonialism. There's no getting around that.

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