How capitalist ideology works

by Philip Ferguson (with thanks to Mihailo Markovic for parts of the three examples at the end)

Why do people accept capitalist ideology as common sense? Why are the problems of capitalist society typically seen as problems of society in general? For instance, the fact that hundreds of millions of people in the world go without even basic nourishment, shelter and clothing is usually said to be a problem of ‘overpopulation’ rather than one of capitalist social relations under which profit rates over-ride people’s actual needs. Similarly, inequality is seen as the result of people’s different abilities rather than the workings of the system within which those abilities exist and are constrained.

Crude, but typical, left-wing explanations of political consciousness revolve around the idea that people are brainwashed by the media and education system into supporting capitalism. Such ‘explanations’ are even often put forward as ‘Marxist’. But this was not Marx’s view of how capitalist ideology and forms of consciousness arise.

Common sense

Marx’s analysis of the capitalist system showed that the inner workings of this mode of production are reproduced at the surface level of society in a thoroughly mystified form. It is the surface appearances of capitalism which confront people in their daily lives. Bourgeois explanations are derived from these surface appearances and therefore ‘make sense’ to people. In fact, they become the ‘common sense’ under capitalism.

For instance, the ‘common sense’ about the relationship between capitalists and workers is that it is fair. The worker does a ‘fair day’s work’ and is paid a ‘fair day’s wage’. The capitalist provides the workplace and the worker provides the labour and they get just returns in the form of profits and wages respectively. Exploitation is then perceived as something that only occurs when workers are paid particularly low wages and/or are forced to labour in particularly horrible conditions. Moreover, since this trade-off – wages for labour-power – is fair and equal, inequality comes to be seen as something apart from the production process. It appears to grow out of differing personal capacities rather than capitalist social relations.

Marx argued that it is the role of revolutionary science to penetrate beneath these kinds of surface appearances and show the underlying processes at work and how and why these processes appear in the forms they do. He showed, for instance, that there is a real, logical basis for the belief that there is a fair trade-off between workers and capitalists. It lies in the fact that workers can and do sell their labour-power at its actual value, and are not defrauded in that sense. But what is hidden in capitalist society is that in the production process labour-power acts as a unique commodity and creates a new, additional value as well as reproducing its own value and that of the raw materials and machines. It is the creation of this additional value – surplus-value – which constitutes exploitation. Moreover, it will generally be the most highly-paid workers in the best conditions who will produce the most surplus-value.

For instance, highly-skilled car workers in an automated Japanese car plant can reproduce the value of their own labour-power in perhaps ten hours, so are producing surplus-value for the rest of the work-week. In contrast, workers in an impoverished Third World country may take half their entire work-week to reproduce the value of their own labour-power and thus create relatively little surplus-value.

Surface appearances

Bourgeois sociologists in the 1960s, at the height of the postwar boom, looked at only the surface appearance, namely that some workers were very highly paid. They drew from this the conclusion that such workers were no longer exploited, and no longer even workers, and thus that a workers’ revolution was off the agenda. Yet in 1968 workers in imperialist France staged the biggest general strike in history, and a decade and a half of industrial militancy, including by highly-paid workers, was unleashed in many western countries.

Additionally, it is the fact that workers have no choice but to sell the one commodit which can expand value, their labour-power, which is the basis of inequality. The capitalist buyers of labour-power become richer and richer, since they own and control all the goods which labour-power produces.

Although many left groups were able to see at least that the working class still existed, most ‘left-wing’ analysis of society still never really went beyond the surface appearances and bourgeois ‘common sense’. The left tends to reproduce the categories of bourgeois thought, rather than transcend them. This is one of the reasons left-wing analysis is often unconvincing to anyone other than a handful of ‘activists’. The result is a sterile species of politically-uninformed ‘activism’, through which people are gradually worn down and worn out, while the basic workings of the capitalist system proceed unimpeded.

60s radicalism

In fact, concentration on the surface appearances can even lead to demanding ‘progressive’ reforms which end up strengthening, rather than weakening, the hold of capital over society. This was the case with much of the radicalism of the 1960s. Essentially the social conventions against which many young people rebelled were a hangover from a previous period of problem-ridden capital accumulation and had been rendered obsolete by the post-WW2 boom. What much of the rebellion of the 1960s did was get rid of the by then obsolete aspects of bourgeois society and modernise the social structure, bringing it in line with the more dynamic process of accumulation which continued until the new slump set in in the 1970s. Understanding the 1960s in this light helps explain why so many youthful radicals of that period went on to become ardent supporters of the (reworked) status quo in the 1980s and 1990s.

For 60s radicals, bourgeois society was also a set of distinct spheres. They would fight in one sphere, rather than challenging social relations as a whole. This allowed capital to contain even the most militant challenge within safe channels and harness the energy to rework that particular sphere and thus rework and strengthen capitalist relations overall. For Marxists, however, the struggle for human liberation is a struggle against capitalist social relations per se. It is always necessary to identify how specific forms of oppression are reflections of underlying social relations. A depth of analysis rarely found on the ‘left’ is crucial for this. In particular Marx’s concept of commodity fetishism and its development by Lukacs in the concept of reification is vital.

Commodity fetishism

Commodity fetishism is the analysis of how relations between people (social relations) are expressed in the “fantastic form” of relations between things (commodities) in capitalist society. It is specific to capitalism, as this is the system of generalised commodity production.

Marx notes that in capitalist society we see the “personification of things and the conversion of production relations into entities. . .” and that this “is an enchanted, perverted, topsy-turvy world in which Monsieur le Capital and Madame la Terre do their ghost-walking as social characters and at the same time directly as mere things.” These entities or things genuinely appear to be self-standing and given, rather than created by human actions and therefore amenable to change, or abolition, by different human actions.

The entity ‘capital’ appears to be capital because of some innate quality, rather than due to a historical process through which new social relations are formed. This also has the result of naturalising capitalism. If a machine is inherently capital, then any machine at any point in the past must also have been capital. Capital has always been and always will be. Thus any attempt to abolish capital is, even at best, misguided. There is no alternative but to accept the existing order.

Spontaneous activity

In people’s day to day experiences they will come face to face with the same appearances, precisely because these appearances are real. As Marx writes of the materialisation of the social relations of capitalism, the appearances are (for the producers) “what they really are, material relations between persons and social relations between things.” In other words, this is what actually happens in a society in which commodity production and exchange are dominant.

This explains why people have little reason to question such appearances and probe into the fact that as well as being real they are simultaneously mystifications of social processes which are not immediately apparent. Thus workers will fight for more pay under the slogan of a ‘fair wage’, not understanding that the wage system itself is predicated on their continued exploitation. This is why industrial militancy and other forms of spontaneous activity never, by themselves, lead to anti-capitalist politics – despite the peculiarly anti-Marxist pretence of many ‘Marxist’ groups that they do.

In fact as the problems of capitalist society have become more and more pronounced, industrial militancy and radical activity in general in New Zealand have pretty much ceased to exist. This is not surprising for Marxists. Since the activity was always predicated on what was possible within capitalism rather than on opposition to capitalist social relations, the less capitalism can offer the less sense it makes to most people to demand anything.

In contrast, Marx noted that “all science would be superfluous if the outward appearance and the essence of things directly coincided.” Science – specifically scientific socialism – is necessary if any real understanding of society is to be gained.

Georg Lukacs

One of the major figures to build on Marx’s work on consciousness and ideology was Georg Lukacs. Lukacs was a leading Hungarian intellectual in the early 1900s, and part of Max Weber’s circle for several years. Radicalised by WW1 and the Russian Revolution, he became a Marxist and one of the leaders of the Hungarian Revolution, the only country outside Russia where revolutionaries took state power (albeit for only six months). Among his important contributions to Marxism, Lukacs drew on Marx’s analysis of commodity fetishism and developed it further with the concept of reification.

Like Marx, Lukacs was vitally concerned with the fact that essence and outward appearance do not directly coincide in capitalist society and that the social relations which govern everything else actually disappear. As he put it, what are actually relations between people acquire a “‘phantom objectivity’, an autonomy that seems so strictly rational and all-embracing as to conceal every trace of (their) fundamental nature: the relation between people.”

In capitalist society, Lukacs noted, “even the individual object which man confronts directly, either as producer or consumer, is distorted in its objectivity by its commodity character.” This process “will be intensified in proportion as the relations which man establishes with objects as objects of the life process are mediated in the course of his social activity.” A critical result of this is that in the minds of people in bourgeois society [social relations] that lie hidden in the immediate commodity relation, as well as the relations between men and the objects that should gratify their needs, have faded to the point where they can neither be recognised nor even perceived.

For that very reason the reified mind has come to regard (specific forms of capital) as the true representatives of his societal existence. . . Just as the capitalist system continuously produces and reproduces itself economically on higher and higher levels, the structure of reification progressively sinks more deeply, more fatefully and more definitively into the consciousness of man.


Reification, then, refers to the process by which social relations, having disappeared from view and direct consideration, are reproduced in people’s minds in the form of things which stand outside, separate, alienated from and above us and our own activities. The concept of commodity fetishism, and its development in this later concept of reification, is crucial to understanding, challenging and raising the existing level of political consciousness.

Lukacs was also critically concerned with the way the division of capitalist society into particular spheres results in partial, rather than total, analyses of social reality. For instance, whereas in feudalism there is no separation of economic and political power, the economic and political realms are formally separated under capitalism. This fact is what gives reformism its intellectual coherence. It does actually logically appear that you can utilise the political machinery to interfere with the economic realm by, for example, taxing the rich (the classic reformist dogma).

It is only by understanding that the formal division of spheres is underlaid by a production process centred on exploitation that we can effectively challenge reformism. As long as that underlying production process is left intact, inequality is continuously reproduced and extended. It is only through shattering the whole mode of production that it is possible to bring about a rational, just and more productive form of human society. Forms of political organisation and activity, along with the slogans advanced, have to clarify rather than obscure that fact if they are to be revolutionary and effective.

To conclude, let’s restate commodity fetishism and reification, using some common examples and showing the historical social process behind them:

1. In a commodity-capitalist economy, social/production relations are transformed into social/objective properties of things.

In this situation, several things happen. Social phenomena are derived from technical phenomena, and thus it appears that what allows capital to make a profit is its technical function in production, investment etc. Yet means of production, money, and goods only become capital when certain classes and production relations come into existence.

A useful historical example of relevance to New Zealand, since it heavily influenced Wakefield and colonisation here, is provided by the sad case of would-be capitalist Mr Peel at Swan River in Western Australia in the early 1800s. Marx records:

First of all, Wakefield discovered that in the Colonies, property in money, means of subsistence, machines, and other means of production, does not yet stamp a man as a capitalist if there be wanting the correlative – the wage worker, the other man who is compelled to sell himself of his own free-will. He discovered that capital is not a thing, but a social relation between persons, established by the instrumentality of things. Mr Peel, he moans, took with him from England to Swan River, West Australia, means of subsistence and of production to the amount of £50,000. Mr Peel had the foresight to bring with him, besides, 3000 persons of the working class, men, women and children. Once arrived at his destination, ‘Mr Peel was left without a servant to make his bed or fetch him water from the river.’ Unhappy Mr Peel who provided for everything except the export of English modes of production to Swan River!

What had happened was that in Australia at that early point in time Peel’s workers could abscond and set themselves up as independent producers on their own patch of land. They could not be compelled to become wage-labourers and sell their labour-power. Peel’s money and means of production remained just that and were thus useless to him at Swan River. They could not become capital.

When Wakefield drew up his colonisation plans for New Zealand he tried to ensure that people could not immediately get onto the land. A ‘sufficient price’ was established to ensure they had to spend a period of time as wage-labourers and that by the time they could afford to buy some land the next round of wage-labourers would have arrived.

2. Technical phenomena are derived directly from social phenomena.

Here, things appear the other way around. It appears that the productivity of labour (a technical function inherent in the means of production) is increased by capital itself, a social form of production. But more and more developed means of production inherently have the capacity to increase the productivity of labour, regardless of whether or not they are capital. As we have just seen, they are only capital at a specific point in human history; most importantly, it is a point we can transcend.

3. Money as medium of circulation, rather than as simple payment for goods.

Circulation in capitalism expresses production relations between people and creates them (in the sense that the circulation of products of labour take on specific social properties – eg value – and can be expressed in money terms). Marx notes, “By the currency of the circulating medium, the connexion between buyers and sellers is not merely expressed. This connexion is originated by, and exists in, the circulation alone.” Money as medium of circulation is specific to capitalism, while money as means of payment “expresses a social relation that was in existence long before.”

The mystifying character of social forms increases with the complexity of the production relations expressed in them, eg the money form further obscures the actual relations. As Marx points out:

“this mystification is still a very simple one in the case of a commodity. Everybody understands more or less clearly that the relations of commodities as exchange-values are really the relations of people to the productive activities of one another. The semblance of simplicity disappears in more advanced relations of production. All the illusions of the Monetary System arise from the failure to perceive that money, though a physical object with distinct properties, represents a social relation of production.”

Things have gone backward since Marx was writing this. In the early stages of industrial capitalism it might have been possible for “everybody” to understand the nature of exchange values. The longer capitalism has been in existence, however, the more this fact has become obscured.

More significantly, commodity fetishism was of central importance to Marx’s entire analysis of capitalist society. Sadly, today, very few people on the left understand this, let alone its political significance.

Posted on October 21, 2011, in Political education and theory. Bookmark the permalink. Comments Off on How capitalist ideology works.

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