What is the capitalist class? An introduction

May 11, 2020

Photo: Gage Skidmore. Source: Wikicommons.

A 2020 report by the Institute for Policy Studies found that “Between 1990 and 2020, U.S. billionaire wealth soared 1,130 percent in 2020 dollars, an increase more than 200 times greater than the 5.37 percent growth of U.S. median wealth over this same period” [1]. In the U.S., 617 billionaires have a total of $2.947 trillion. Moreover, “the 400 richest Americans on the Forbes 400 list own as much wealth as America’s bottom 64 percent, nearly two-thirds of the nation’s households combined” [2]. This increasing inequality took place during COVID-19 pandemic, in which millions of workers lost their jobs.

Why is it that society is increasingly polarized into the ultra-rich and the rest of us, or as Occupy Wall Street put it, the 1 percent and the 99 percent?

What the study above presented as facts are really manifestations of the class struggle, the struggle between the capitalist class and the working class.

Class societies existed before capitalism, but capitalism unique in that it’s defined by “splitting up” of society “into two great hostile camps, into two great classes directly facing each other: Bourgeoisie and Proletariat, or capitalist and worker” [3].This is an ongoing process, as the statistics above show.

The capitalist class’ origins

The capitalist revolution that overthrew feudalism was a long and complicated process, one that was incredibly violent. As Marx put it in Capital, “In actual history, it is notorious that conquest, enslavement, robbery, murder, briefly force, play the great part” [4].

Feudalism was based on landed property, where the ruling class owned the land and the serfs and peasants worked the land. One reason that capitalism was able to overthrow feudalism is that capital is mobile, whereas land isn’t. Capital isn’t tied to any one place. Capitalism had to take the land from the Feudal lords, from the Church’s Estates, and the common land and privatize it. It did this through state legislation, individual acts of terror, and in the case of the U.S., the genocide of indigenous people.

It also had to deprive people of the ability to reproduce their own livelihood. It had to kick peasants off the land and, often through police repression, force them to work in the factories. This is still an ongoing process throughout the world. It had to turn the ability to labor into a commodity, which means that the worker is “free” to sell their labor and “free” of the means of production, so they have nothing to sell except for their labor-power.

As they accumulated capital, they accumulated political power.

What defines the capitalist class?

In capitalist countries, the capitalist class is the ruling class. For Marxists, class isn’t about how much money you make, how you talk, what kind of car you drive, or anything like that. Class is an objective relationship to the means of production. Capitalists own the means of production—the factories, the warehouses, the businesses, the communication and transportation networks, the ships and satellites, the banks, and more. In other words, they own the productive forces, or the various mechanisms that are used to produce commodities. They also own the raw materials, like minerals and fabrics, steel and fuel sources, among others.

The working class is forced to sell their labor-power to the capitalists in exchange for a wage that may or may not provide them with enough money to reproduce themselves. Workers work on the means of production to transform raw materials into commodities (goods and services) and, through their work, they add value to the commodity. This is because the capitalist doesn’t pay the worker for the entire value they create, but only part of it. One part of the day, or hour, or minute, we’re working to reproduce our wage, and the other part, we’re working for the capitalist.

Capitalists also own the products of our labor. What Marx called the “coercive laws of competition” compel capitalists to constantly cheapen their commodities so they can out-compete other capitalists. They do this often through technological innovations that put workers out of work. They also do this through fighting to lower the wages of workers.

As much as they own, capitalists lack the fundamental source of new value and new profits. Workers have that power. We keep the system running, and we can shut it down. Through organizing into unions, for example, we join together and withhold our labor to win demands from the bosses. We struggle in the streets to win concessions from the state. But as long as capitalism exists, these gains will be temporary and we have to fight to keep them.

The capitalist state

Because capitalists are the ruling class, they control the state. Another way they earn more profits is through expropriation, by taking that which was formerly public and privatizing it. With the help of the state and other political bodies, they transform public schools into private charter schools. Or they sell the parking meters to corporations and banks. Or they have the stat sell them the rights to water and transportation. The intermingling of economic and political power has developed over a long time and has created longstanding networks of power inside the capitalist establishment. It’s difficult to tell where the state ends and capital begins. This, of course, is specific to the United States and imperial states. Every nation has its own particularities.

Are U.S. elected officials part of the ruling class? Many are. The most recent example is Donald Trump. Dick Cheney was once CEO of the largest oil service corporation, Halliburton. George Bush used to be an executive of a small oil company. During his tenure, John Kerry and his immediate family had $747 million in personal wealth.

Millionaires are common in Congress, especially in the “millionaires club” known as the Senate. But whether they are rich or not, elected officials in the U.S. are in office to represent the interests of the capitalist class. Politicians’ campaigns are financed by the ruling class.

The capitalists use the state to protect and advance their interests. They deploy the military to pursue their interests abroad, and the police to repress workers domestically. The ruling class uses the military to protect their private property and the police and National Guard to oppress workers.

Yet the state also serves to manage contradictions within and between classes. For example, there’s a contradiction between the individual capitalist’s search for surplus-value and the collective capitalist’s interest in ensuring the continuity of the system. If left to their own devices, individual capitalists would end up destroying the conditions that they need to make profits. They’d make workers work for so long and so little that there would be a shortage of labor-power on the market and workers wouldn’t be able to reproduce the next generation of laborers. Or they’d use up all of the raw materials and destroy the earth even faster than they’ve done so far. So the state steps in to regulate in the interests of the collective capitalists.

The composition of the capitalist and working classes

Marx and Engels accurately saw capitalism as progressively polarizing society. Yet it’s not as if there are only two groups of people. There are two classes, but there are different layers and strata within both.

There are different kinds of capitalists that have different interests and serve different functions. There are productive or industrial capitalists who own the means of production and the companies that produce goods and services. There are finance capitalists who own banks and lend money to other capitalists and workers (and the state). There are merchant capitalists who distribute and sell goods. There are landlord capitalists There are who own houses, factories, warehouses, and more, and charge rent to other capitalists and the working class [5].

These capitalists can have conflicting interests.

The productive capitalist, for example, comes into conflict with the landlord in that the former wants to pay as little rent as possible and the latter wants to collect as much rent as possible. They also conflict with the merchant capitalist. They need the merchant to sell their products, but the merchant takes a cut. There’s constant struggles over what this cut is. Finally, they conflict with finance capitalists, who want to charge as much interest as possible, while the productive capitalists wants to pay as little interest as possible.

The capitalist who owns a factory, for example, doesn’t keep the entire surplus value they acquire. They have to give some to the banks, to the landlords, the merchants, and the state.

Then there are the petty-bourgeoisie, or small capitalists, employ people or are self-employed. In other words, they exploit a few people due to the scale of their operations, but if they wish to succeed, they have to grow or else they’ll be bought out or driven out of business by a larger corporation.

When Marx was writing, productive or industrial capitalists were in power. By the turn of the century, however, finance capital was in control.

It’s the same with the working class. There are different strata of the working class, from highly paid workers to unemployed and imprisoned workers. Workers displaced by machinery swell the ranks of the industrial reserve army, those capital can call on if needed, and can be organized in a revolutionary direction or mobilized by capital in a reactionary direction to, for example, break strikes.

There are managers or supervisors who oversee other workers, but don’t own the company. As capital develops, Marx wrote, the capitalist has to delegate supervision to what he called “a special kind of wage-labourer” [6]. They receive higher pay and better benefits than workers. They are not capitalists but technically workers insofar as they sell their labor-power, and the concrete labor they perform is to act as representatives of the bosses. They’re less likely to be won over to the socialist program, although it’s possible, especially in times of crisis.

There are state workers like teachers and civil servants who don’t produce profit but make the capitalist state function. They aren’t employed by capitalists, but they’re part of the working class.

But Marx wrote that, from the view of society as a whole, “the working-class, even when not directly engaged in the labour-processs, is just as much an appendage of capital” [7]. The Marxist project, and our project today, is to unite as many elements of our class as possible and to organize them to fight the capitalists. This means combating racism, national chauvinism, anti-immigrant bigotry, sexism, heterosexism, ableism, and all systems that divide workers against each other. If we’re united, the capitalist class doesn’t stand a chance.

Society can change if we organize and unite our class!

The production of goods and services as a means to maximize profits for a tiny segment of the population-the sole reason that goods and services are produced under capitalism-has created a severe constraint on the potential productive power of society. It has made it impossible to meet human needs.

Because production is socialized, the entire working class is involved in the process, and society produces more wealth than ever before. If the ownership of that wealth was also socialized, instead of being the private property of the few, all workers’ needs could be met. Food, housing, education, health care, and a healthy environment could be a right for all. This type of system is socialism. In the first stage of socialism, the principle of equal pay for equal work can be immediately realized.

Regular recessions, depressions and mass unemployment are the consequences of the capitalist boom and bust cycle. Socialism, liberated from this, is the only economic system that can unleash the full productive power of humanity and eventually distribute the abundant goods of society to all based on human need.


[1] Collins, Chuck, Omar Ocampo, and Sophia Paslaski. (2020). Billionaire bonanza 2020: Wealth windfalls, tumbling taxes, and pandemic profiteers (Washington: Institute for Policy Studies), 1.
[2] Ibid., 5.
[3] Marx, Karl and Friedrich Engels. (1848/1967). The communist manifesto, trans. S. Moore (London: Penguin Books), 220.
[4] Marx, Karl. (1867/1967). Capital: A critique of political economy (vol. 1): The process of production of capital,trans. S. Moore and E. Aveling (New York: International Publishers), 668.
[5] See Marx, Karl. (1885/2019). Capital: A critique of political economy (vol 2): The process of circulation of capital (New York: International Publishers), ch. 1-3.
[6] Ibid., 314.
[7] Ibid., 538.

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