Global revolution: Sven Beckert's "Capitalism"
Thinking about digital finance’s frontier as part of the biggest story of human existence.
You’ve probably heard a version of a story about fish who don’t realize they exist in water. Or maybe they know it, but it’s so pervasive, so innate, so seemingly natural to them, that they don’t know how to think about the water and what it means if, say, the water is drying up or if it’s channeling over a cliff.
Reading Sven Beckert’s Capitalism: A Global History is like the fish being jolted into recognizing that, hey, they’re in water!
I followed Beckert’s account with an eye on today’s digital finance, and found the book gives shape to the forces that are driving today’s world. Digital finance represents the latest incarnation of capitalism, which is a changeling, an ever-shifting beast that will go through all manner of contortions to be true to its nature: that is, to pursue the accumulation of more capital.
Beckert, a professor of history at Harvard University, has written an epic tale of capitalism, the biggest driver of human affairs since, well, probably ever. His premise is that capitalism is and always has been a global phenomenon, even if in the early days it was relegated to a handful of merchants in a few islands or strongholds.
The first capitalists were merchants who engaged in long-distance trade, and who as a result developed views and values that were distinct from the rest of society. The discovery of the Americas both turbocharged capitalism as well as tilted power to northwest Europe, but the capitalist type existed everywhere.
Neoliberalism
Another fishy quality of our generation – of mine, at least – is the neoliberal headfake that equates capitalism with free markets. After all, we have grown up believing in “free-market capitalism”, especially after the collapse of the Soviet Union. I am revealing my American biases, but this is, I think, even true of people who come from places like China: the belief that development is inextricably tied to opening markets. The neoliberal language of Reagan and Thatcher – manifested in the globalized capital flows since Nixon took the US off the gold standard – still reverberates, especially if you work in finance.
But the neoliberal moment is over. It ended, for lack of a better moment, with the 2008 global financial crisis. Unlike in 1929, though, our central banks prevented collapse, so while we didn’t experience a 1930s-style Great Depression, we have also not thrown off the ideological shackles, as Europeans did in the aftermath of the depression and two world wars. But ideology that died isn’t capitalism. It’s neoliberalism and its religious belief in the freedom of markets.
The Chinese leadership was the first to reject this – in the ruins of 2008, which convinced them that the US model wasn’t something to blindly follow. We’re in an Asian-led phase of capitalism today not just because the manufacturing moved there, but it also has led the way in rethinking the relationship between capitalism and markets.
Capitalism and the state
Note that I didn’t say ‘capitalism and the state’. One of the realities that Beckert examines is the paradox of capitalism’s dependency on an ever-more powerful state. This is why it’s perfectly accurate to describe Chinese capitalism while acknowledging that China has never operated free markets.
There have been periods when free markets did explain the world. The Islamic ‘golden age’ of the eighth to tenth centuries was one of free markets. There was no caliph telling merchants what to do. The apogee of free-market capitalism occurred around 1850 to 1918, and was destroyed by World War One, although it took the messes of the 1930s to make clear just how badly the liberal world had failed most people. But after the post-war decades of regulated markets, liberalism returned in the 1970s.
Markets are arenas of exchange. Markets are ancient, but have usually been embedded in broader social norms like reciprocity, redistribution, and household relations. Markets rarely called the shots, although under capitalism they became extraordinarily useful.
Capitalism versus markets
Capitalism is a social order organized around the ceaseless accumulation of capital. Capitalists organize production not for its own sake, but to turn money into more money. In this process, inputs and out puts (land, labor, raw materials, knowledge) become commodities. It is within markets that they are bought and sold, for money. During eras of general stability, freer markets make for better channels for the capitalist impulse.
But such markets needn’t be free, and in capitalism, usually are not. Capitalism tends toward monopoly and concentration, not competition. It is in fact anti-market, with the great fortunes built through privileges, monopoly, and political power, which has enabled the coercion of labor. Such measures included slavery, peonage, colonialism, and wage labor. Very slowly, the rise of both labor movements and wealthy consumers led to rising living standards for all, but this is a precarious byproduct.
Enclosure
Capitalism’s advance has depended on states that create, police, and – as we saw in 2008 – rescue capitalist orders. In the sixteenth and seventeenth centuries, capitalism was joined at the hip with imperial expansion, armed trade, colonialism, slavery, and massive dispossession to create a world economy. Merchants could seize land and people because the states granted monopolies and codified seizures in property law.
One of the most powerful forms of this was ‘enclosure’, be it transforming the English countryside from one of commons to private land for agriculture, to slave plantations in Brazil, the Caribbean and the American South to produce cash crops for export, be it sugar or cotton. There was nothing ‘free market’ about this.
Such patterns morphed into industrial capitalism, welfare states, and imperial projects, but all married capitalism with fiscal capacity, infrastructure, legal systems, and military power.
The end of neoliberalism
Neoliberalism, which we think of as representing the rollback of the state, was simply another transformation and deepening of capitalism with the state, Beckert argues. It took government action to liberalize trade, deregulate finance, privatize public infrastructure, crush labor movements, and facilitate capital mobility that underpinned the offshoring of manufacturing from the West to Asia.
None of this was spontaneous. And we saw it most of all in 2008, when we got socialism for Wall Street banks and free-market ruthlessness for everyone else. Nor was this just an American response. Governments in China, Japan, Germany and elsewhere injected nearly $1.5 trillion of public funds to stave off collapse. Capitalism survived at the pleasure of the state, which acted because of its own dependencies on what capitalism delivers: wealth, growth, a tax base, consumers, and the ability to provision a military.
That event segued into the rise of Asian capitalism as the primary driver of global growth. Or rather, capitalism, ever-changing, found new life in the rise of Asia. Song and Ming China, Mughal India, and Tokugawa Japan were all times and places with commercialized societies, brimming with merchants and sophisticated credit and monetary systems. These all flourished under strong imperial states.
Asia returns
But in recent decades, the region has seen an explosion in wage labor and export-led industrialization, all based on governments managing exchange rates, industrial policy, credit allocation, infrastructure building, and a merciless control over workforces. All of this was designed to integrate these countries into global commodity chains, with a very selective attitude toward liberalizing markets. The neoliberal age’s hallmarks, such as offshoring production, just-in-time supply chains, and cheap skilled labor, was thanks to Asian governments paving the way for foreign investment. Markets were the mechanism though which these policies were executed.
Neoliberalism may have exulted the market but it was another version of a state-centric political economy, Beckert says. Political engineering is as important as price signals. The West ignored this fact until 2008 forced it to reckon with reality. Asian governments, more reluctant to embrace Milton Friedman-like beliefs, were already interventionist.
The rise of Asia and our global shift into a new era of capitalism is just another chapter of the changeling nature of capitalism and its all-consuming quest for accumulation. Factors of production are now more about ideas, data, and financial claims, than building steel mills or tea plantations. We are going through a new phase of ‘enclosure’, with data sovereignty laws and Big Tech platforms stealing and hoarding our information. AI is just the latest example. Chinese capital controls are enclosures of capital, too, and such regimes are likely to become more numerous, as industrialized nations seek to monetize their debt. But capitalism can thrive in such environments too.
Capitalism’s end?
You have surely heard someone refer to our times as “late-stage capitalism”. As we are fish in water, it’s hard to know if we are going through such a transformation. Given the centuries it took human civilization to evolve into a capitalist society, the idea that a single war or market crash is going to sweep all this away seems naive.
On the other hand, Beckert notes that capitalism has always relied on exploiting natural resources. The turbocharge of European conquest of the New World offered breathtaking opportunities to extract, using slave labor. But climate change, the loss of biodiversity, the self-harm of omnipresent plastics, and other environmental harms may put a sudden brake on things (measured in decades instead of centuries). I’d add the precipitous crash of populations everywhere bar Africa will also pose a challenge to economic growth that we’ve never experienced before; the closest approximation is the Black Death of the thirteenth century.
But such constraints may be superseded by what Beckert calls ‘knowledge capitalism’ and the financialization of everything. Financialization began in the twentieth century, ushering in the neoliberal era. Today, tokenization, prediction markets, Robinhood, and agentic AI are all examples of deepening financialization.
Most of this activity is zero-sum. Is it is a decadent last gasp of the capitalism we’ve known, a final hurrah? Or is it pointing to new ways for capitalism to endure even as its traditional foundations crumble, as risk, reputation, future income streams, and even identity itself become commodities?
We can guess, but we’re still fish who can’t see the water in which we swim.
Digital capitalism
The chaos of today’s geopolitics may seem like they go hand-in-hand with the libertarian ideologies of new technology: blockchains that make banks and governments obsolete, “censorship-resistant” money, and smart contracts that replace law with code. But advocates for these technologies misread the history of capitalism. They are mistaking it for that of free markets.
Capitalism, as Beckert demonstrates time and again, is defined by its mutual reinforcement with state power. Central-bank digital currencies and agentic AI transactions rely on oligopolistic platforms, state-built structures, and regulated networks. Stablecoins are being brought to heel as they must bow to KYC rules, crypto exchanges must obey law enforcement actions. Tokens and other new asset classes will be increasingly subject to enclosure within legal and regulatory regimes and identity systems, transforming them into a standardized form of collateral that will serve global capital.
Capitalists used to enclose cattle and sheep; now they are enclosing information, behavior, and subjectivity – the idea of truth. Behind the libertarian lingo there is the ongoing fusion of digital platforms and big finance with assertive states, from Beijing to Brussels. If we want a return to freer markets, it must come from social resistance to the digitalization of everything for the enrichment of platform plutocrats, and capturing state levers to make it so.
Beckert, Sven, Capitalism: A Global History, Penguin Press: New York, 2025.