Capitalism ≠ Liberty : Notes from Wood and Brenner

Capitalism ¹ Liberty : Notes from Wood and Brenner

The conventional narrative posits that capitalism arose naturally from expanding trade, urban development, wealth accumulation, or technological advancement – elements supposedly present throughout history, requiring only liberation from feudal constraints which had stumbled their pre-presence. Ellen Wood’s The Origin of Capitalism and Robert Brenner’s Agrarian Class Structure and Economic Development and Property and Progress: Where Adam Smith Went Wrong, reveal a dramatically different story: capitalism emerged from a specific transformation of social property relations in the English countryside, creating for the first time markets operating not as opportunities but as imperatives – mechanisms compelling certain behaviors on pain of elimination. This distinction explains why capitalism emerged specifically in the English countryside rather than in societies with more extensive commerce, and illuminates why capitalism represents not natural liberation of economic behavior but creation of novel compulsions operating through apparently impersonal (and hence, “un-free” contrary to libertarian narrative) market forces.

The Concept

No quantity of accumulation – from theft, imperialism, commercial profit, or even labor exploitation – by itself constitutes capital or produces capitalism. Roman senators, Venetian merchants, Spanish conquistadors accumulated vast wealth without creating capitalism. What transforms wealth into capital is not quantity but social form: property relations generating capitalist “laws of motion” – imperatives of competition and profit-maximization, compulsion to reinvest surpluses, systematic requirement to improve labor productivity and develop productive forces for subsistence. It is when “safety first” gets linked to constant production, fundamentally reinventing social relations of production.

This means capitalism cannot be defined by the presence of markets simpliciter (which have existed for millennia), nor by trade (connecting distant civilizations in antiquity), nor even by profit-seeking behavior (motivating merchants throughout recorded history to “buy cheap and sell dear”). Rather, capitalism is defined by specific social relations that create systemic imperatives for continuous accumulation and productivity improvement

Marx identified the critical transformation in English countryside. In Marx’s account, the critical transformation occurred in the English countryside through the expropriation of direct producers (Wood, p.40). Landlords derived rents from capitalist tenants’ commercial profits. These tenants were actually leaseholders: after absolute ownership was expropriated in lords’ favor, rents were levied competitively upon lease transfers, exchanged for freedom from serfdom and common law rights in King’s Courts. Meanwhile, numerous small producers underwent dispossession and became wage laborers. Marx regards this rural transformation as the authentic “primitive accumulation” not because it created a critical mass of wealth – numerous societies had accumulated substantial wealth through conquest and trade – but because these social property relations generated novel economic imperatives, particularly the compulsions of competition and a systematic requirement to develop productive forces, producing new laws of motion unprecedented in human history. (Wood, p.40).

Polanyi recognized that only in “market society” do economic institutions separate from social relations, with society becoming market’s “adjunct” rather than economy embedded in society (Wood, p.26). Without “protective countermoves,” “human society would have been annihilated.” According to Wood, however, Polanyi’s explanation contained technological determinism – arguing complex machinery necessitated commodifying labor. This, according to Wood, inverts reality. She argues that radical social relations transformation preceded industrialization (Wood, p.29) – Capitalist imperatives drove machinery development, not the reverse.

What transpired in the English Countryside?

Through competitive political accumulation, particularly responding to the emerging French monarchy, Anglo-Norman lords created a more centralized feudal state than existed elsewhere in Europe at that time. By organizing through a national monarchical state that could discipline the aristocracy, English lords achieved unusually high cooperation in operating their decentralized surplus extraction system and in military ventures (Brenner, p.20-21).

A critical institutional innovation was imposing a national common law system binding the lords themselves. This system granted all free persons, including legally free peasants, access to royal courts while excluding unfree peasants and relegating them to manorial jurisdiction. The resulting enhancement of lordly power enabled English lords to experience an economic golden age from the late twelfth through early fourteenth centuries – precisely when French lords faced declining feudal revenues due to peasant gains. English lords imposed tighter serfdom with state assistance, maintaining extraction levels right until the Black Plague (Brenner, p.21).

The catastrophic post-plague population collapse undermined coercive extraction. The drastically altered man-land ratio caused lordly cooperation to collapse under competitive pressures for scarce tenants (Brenner, p.21). The 1381 revolt proved watershed – peasants streamed away, lords competed offering better terms and legal freedom through written manor roll copies (contracts between legal equals). By the fifteenth century’s second quarter, most English peasants had won freedom and paid reduced rents.

This was the social condition that created lords’ existential threat. Unable to reimpose feudal levies, they deployed their “trump card”: the powerful monarchical state they could now repurpose (Brenner, p.22). With Tudor state assistance, lords asserted that customary land remained subject to arbitrary, variable rents upon transfer – transforming it into commercial leasehold, effectively lords’ own property, as against peasant proprietorship that was prevalent in France. State power suppressed sixteenth-century peasant revolts vindicating customary rights in the land, separating the peasants from their means of subsistence. Lords cut short peasants’ push to win not just freedom but fixed payments and inheritance rights, thereby establishing their own property rights, while severing tenants from full means of subsistence, rendering them market-dependent, as the cost of freedom (Brenner, p.22). This is why it is sometimes referred to as “freedom in the double sense”.

Critically, English lords understood themselves as acting within established feudal tradition, merely reaffirming their customary prerogative to impose arbitrary levies on customary tenants. Their objective was not creating a new system but preventing peasants from consolidating possessory rights – fixed dues and inheritance rights – that would eliminate lords’ ability to obtain economic returns from customary land. Given population growth’s inflationary pressures, consolidation of such peasant rights threatened lords’ capacity to extract any meaningful rent whatsoever (Brenner, p.22).

The epochal yet unintended consequence was – subjecting tenants to competitive lease bidding, imposing necessity to abandon subsistence production and adopt capitalist reproduction rules (Brenner, p.22-23). Once rendered market-dependent, emerging farmers had no alternative but to alter their “safety first” strategy – Production and maximal accumulation to win rent-competition was initiated as that was the only way of being safe from being famished. This transformation was fundamentally political – lords inadvertently created capitalism while preserving feudal privileges.

This transformed into what Robert Brenner identifies as a classical landlord-capitalist tenant-wage labor structure (Brenner, p.35). Landholding in England was unusually concentrated. Large landowners controlled an unusually substantial proportion of land under conditions enabling them to deploy property in novel ways (Wood, p.102-103). An unusually large proportion of land was cultivated not by peasant-proprietors but by tenants – a pattern reflected linguistically in the fact that the word “farmer” originally and literally signified “tenant,” as the phrase “farming out” continues to indicate.

What English landlords lacked in “extra-economic” powers – juridical, military, political powers continental lords employed  – they compensated for through increasing “economic” powers from controlling land and structuring tenant relationships (Wood, p.102-103). Their income depended on tenants’ capacity to produce profitably and remit rent from that profit. Both landlords and tenants came to depend on the market in historically unprecedented ways merely to secure conditions of their own social reproduction (Wood, p.56).

“Rules for reproduction” captures how property relations determine logic by which actors must operate to survive and reproduce themselves – they constitute individual action. Reduced to market dependence, commercial tenants had no alternative but to adopt “production for exchange,” maximizing profits through specializing, accumulating, innovating (Brenner, p.29). They abandoned peasant rules: producing numerous children for insurance, subdividing holdings.  Customary leases ultimately transformed into economic leases, and property itself became an instrument of economic exchange as against ownership by conquest.

The consequence was a highly productive agrarian sector in which landlords and tenants alike became preoccupied with “improvement” – the enhancement of land’s productivity for profit (Wood, p.109). This dynamic initiated an entirely novel historical process: an unprecedented rupture with old Malthusian cycles, a process of self-sustaining development, new competitive pressures that generated their own effects upon the requirement to increase productivity, further concentration of landholding (Wood, p.56). Where other European societies remained trapped within cycles of expansion and crisis, England achieved breakthrough to sustained growth – not through technological superiority or greater commercial development but through transformed social relations imposing systematic imperatives for productivity improvement.

This makes clear that capitalism does not simply liberate pre–existing entrepreneurial tendencies or rational economic behavior. Rather, it creates entirely new compulsions that reshape behavior across multiple domains, production, investment, family formation, demographic patterns. Understanding these transformed rules for reproduction illuminates why the absence of such transformation in other contexts, most notably France, failed to generate capitalist dynamics.

French Contrast

French peasants enjoyed land at fixed rents. Where English landlords obtained rent increases through cooperation in improvements increasing output, French lords extracted larger shares of declining output. The paradox: customary property rights meant poverty and backwardness. In England, absence of secure peasant rights facilitated development (Brenner, p.47). Self-preservation became linked to production and commodifying labor.

The peasant proprietor faced relatively little pressure to operate his plot as profitably or efficiently as potential competitors in order to survive, because no direct mechanism existed through which such competitors could “defeat” him (Brenner, p.44-45). Unlike a tenant, the peasant proprietor need not provide a level of rent equal to what a landlord might obtain from any alternative tenant or face eviction. Unlike the independent artisan within a competitive urban environment, he need not produce cheaply enough to sell goods profitably at market price or face business failure and thus famine, as acquisition of means of subsistence was dependent on the market and not through basic proprietorship or general ability (but specialization). All that survival required for the peasant proprietor (assuming food production) was sufficient output to provide for family subsistence and to meet tax obligations and generally fixed customary rents, which could often be supplemented through wage labor (Brenner, p.45).

The peasant proprietor could resist market pressures simply by maintaining possession, by producing sufficient for subsistence, by supplementing farm income with wage labor as necessary. He need not maximize profit or improve productivity competitively. He could survive through satisficing rather than optimizing. Surplus could be reinvested for luxury, but adopting specialization and more productive mechanisms meant divorcing from means of subsistence, which was antithetical to the “safety first” approach. A market for basics necessarily came with the burden of risk.

Possessing means of subsistence shielded peasants from competition (Brenner, p.66). But why not pursue the gains from trade anyway, as rational homo economicus theory predicts? Here, Brenner identifies “the fatal flaw of Smithian trans-historical micro-economics”: Smith specified gains from specialization but “failed to consider and investigate the other side of the coin  – potential costs” (Brenner, p.67). The primary constraint: “safety first.” Bad harvests were unpredictable, leading to subsistence crises. Peasants specializing in non-food crops faced incalculable danger of being squeezed between high food costs and low output returns  – risking famine (Brenner, p.68). Given starvation as business failure’s cost, peasants adopted “safety first.” Large families provided insurance but reduced surplus, creating intolerable competitive disadvantage if specializing. No incentive is needed to not be willing to starve  – it is an imperative.

Contrarily, In Adam Smith’s explanation, as merchants offer lords irresistible luxuries previously unavailable, lords, at an individual level dismiss retainers, expel peasants, offer commercial leases – producing capitalism. But Smith accomplishes this only by ignoring feudal social-property relations as constraints (Brenner, p.70-71). Smith’s lord acts rationally only if capitalism already exists  – he presupposes its existence, reflecting lack of understanding the socially curated and constitutive nature of humans. This is methodological individualism failing to grasp how social structures constrain action.

Opportunity to Imperative

Throughout history, direct land access – through ownership, customary rights (common pool use rights Wood specifically recounts, before “improvement” led to “enclosures”), or traditional arrangements  – was given for agricultural producers. In England, access became market-mediated, contingent on competitive success. The emergence of “economic rents” – determined by market conditions, not custom – exemplifies this transformation (Wood, p.103-104). Surveyors calculated “unearned increment” accruing to customary tenants paying below market-determined value – early capitalist rationality reducing social relationships to abstract monetary calculations.

The triad of landlord, capitalist tenant, wage laborer emerged. With wage labor growth, the same process created highly productive agriculture but also increasing propertyless mass constituting both wage-labor force and domestic market for cheap consumer goods – “a type of market unprecedented in history” (Wood, p.106). This mass market of the poor became central to industrial capitalism.

Improvement, Enclosure, and Locke’s Labour Producer Theory

The concept of “improvement” encapsulates the transformation in economic mentality and practice that accompanied agrarian capitalism. The word itself, in its original signification, denoted not merely “making better” in a general sense but specifically meant to render something productive of monetary profit, especially to cultivate land for profit – derived from the old French for “into” (en) and “profit” (pros) (Wood, p.109).

By the seventeenth century, the word “improver” designated someone who rendered land productive and profitable, especially through enclosure or waste reclamation. In the eighteenth century, “improvement” in both word and deed achieved its full articulation. The concept reveals how capitalism transforms the very criteria by which we evaluate resource utilization – from serving human needs or community welfare to generating profit.

An extensive new body of literature emerged in the seventeenth century elaborating techniques and benefits of improvement (Wood, p.109). This literature operated not merely at the technical level but functioned profoundly ideologically, disseminating a novel conception of humanity’s relationship to land and nature. Improvement became a major preoccupation of the Royal Society, which assembled England’s most prominent scientists – including Newton and Boyle – with members of ruling classes such as the first Earl of Shaftesbury and his protégé John Locke, who himself was a follower of Pierre Nicole (Wood, p.109-110).

Improvement did not depend primarily upon significant technological innovations. Generally, it involved new developments in farming techniques or refinements of established ones: convertible husbandry, crop rotation, drainage (Wood, p.110). The agricultural revolution that preceded industrialization was not primarily a technological revolution but a social one. The same techniques had often been known previously; what changed was the systematic compulsion to apply them.

However, improvement signified something more fundamental than novel techniques: it signified new forms and conceptions of property (Wood, p.110). “Improved” farming entailed enlarged and concentrated landholdings. It necessitated the elimination of customary practices that interfered with the most productive use of land – “productive” now defined strictly in terms of marketable output and profit. This was the first showcase of classical liberalism: a curb on regulation (through customary rights) or interference in the “market” to make it pure competition.

Peasants had employed various means of regulating land use in the interests of village communities since time immemorial (Wood, p.110-111). They restricted certain practices and granted certain rights not to enhance landlord wealth but to preserve the peasant community itself, perhaps to conserve land or distribute its fruits more equitably, often providing for the community’s less fortunate members. Distributive thinking was present but would be replaced. These practices reflected an entirely different rationality than capitalist improvement – one oriented toward community reproduction, equity, and sustainability rather than profit maximization.

Even private ownership had typically been conditioned by such customary practices, granting non-owners certain use rights to property owned by others, making it a means of subsistence for most. In England: common lands with grazing rights or rights to collect firewood; various use rights on private land, such as rights to collect harvest leavings during specified periods; traditional arrangements for crop rotation requiring coordination among landholders (Wood, p.110-111). Commons were common.

From the standpoint of improving landlords and capitalist farmers, land required liberation from any such obstructions to their productive and profitable property deployment. Between the sixteenth and eighteenth centuries, increasing pressure developed to extinguish customary rights that interfered with capitalist accumulation (Wood, p.111). This could entail disputing communal rights to common lands by claiming exclusive private ownership; eliminating use rights on private land; or eliminating customary rights of smallholders’ possession without unambiguous legal title.

This reflected a transformation in the understanding of property – from means of subsistence (access to means of subsistence) to means of maximal production to generate maximum profit, for maximum accumulation, to secure subsistence in a competitive environment. In all these cases, traditional conceptions of property required replacement by new, capitalist conceptions – not merely as “private” but as exclusive (Wood, p.111). This represents a first hint of the concept of allocative efficiency. Other individuals and the community required exclusion through elimination of village regulation and restrictions on land use, especially through extinguishing customary use rights. Property had to become absolute, exclusive, and alienable – a bundle of rights deployable solely according to owner’s calculation of profit, unencumbered by social obligations or community claims. This points toward a transformed meaning of property rights. What about the emergence of “intellectual property rights” around this time?

Enclosure is often understood simply as the physical fencing of common land or open fields. However, enclosure signified not merely physical demarcation but the extinction of common and customary use rights upon which numerous people depended for their livelihood (Wood, p.111).

The first major wave of socially disruptive enclosure occurred in the sixteenth century, when larger landowners sought to expel commoners from lands that could be profitably deployed as pasture for increasingly lucrative sheep farming. Contemporary commentators attributed to enclosure, more than any other single factor, responsibility for the growing phenomenon of vagabondage – those dispossessed “masterless men” who wandered the countryside and threatened social order.

A novel form of enclosure movement emerged in the eighteenth century: Parliamentary enclosures (Wood, p.112). The extinction of troublesome property rights that interfered with landlord accumulation now transpired through acts of Parliament. Nothing testifies more clearly to the triumph of agrarian capitalism. The state itself became the instrument for dispossessing commoners and transforming property relations. Is this neo-liberalism? So much so for law being constitutive, as against social relations being constitutive of the law.

Pressures to transform property manifested themselves in court cases, in conflicts over specific property rights (Wood, p.112). In such cases, customary practices and claims often confronted directly the principles of “improvement,” and judges increasingly recognized reasons of improvement as legitimate claims against customary rights that had existed for as long as anyone could recall. Where custom, tradition, and community need had once justified certain rights and practices, profit and productivity now became the standard.

Locke’s property theory, batting for enclosure, hinges on “improvement” (Wood, p.113-114). Locke commences with the proposition that God “hath given the world to men in common” (II.26), but proceeds to demonstrate how individuals came to possess property in particular things (Wood, p.113). Such private, individual property constitutes a God-given natural right. Men own their own persons, and the labor they perform is therefore their property. A natural right of property is established when a man “mixes his labor” with something, thereby removing it from its natural state or altering its natural condition.  The theme permeating his discussion was that the earth exists to be rendered productive and profitable, and this is why private property, which emanates from labor, supersedes common possession (Wood, p.113-114).

This was the first articulation of any value – later to be revealed as exchange value – emerging out of production, in an environment where increased production and improvement was the only means of subsistence. Locke calculated “99/100” should be attributed to labour rather than nature. Crucially, Locke considers exchange value, not use value (Wood, p.114).  Something particularly revealing emerges upon careful examination of Locke’s argument (Wood, p.114-115). There exists something initially appealing about the proposition that labor constitutes the source of value and the basis of property – it appears to ground property in actual productive activity rather than arbitrary power. However, something profoundly problematic becomes evident. No direct correspondence exists between labor and property because one man can appropriate another’s labor. The transferability notion becomes crucial. He can acquire a property right in something by “mixing” with it not his own labor but the labor of someone else whom he employs.

It appears the issue for Locke concerns less the activity of labor as such than its profitable deployment or its link with production/productivity. In calculating the value of the acre in America, he addresses not the Indian’s expenditure of effort but the Indian’s failure to realize profit. The issue is not the labor of a human being but the productivity, rendering exchange value, and its application in commercial profit (Wood, p.114-115), increasing common stock.  (More on Locke in the next post).

What then is Capitalism?

Only in capitalism are legally free direct producers completely dispossessed, surplus labor appropriated through purely “economic” means (Wood, p.99). Workers have common law rights enforceable in King’s Courts yet must sell labor power because separated from means of production. Markets existed throughout history, but capitalism’s market possesses unprecedented function: the principal determinant and regulator of social reproduction (Wood, p.100). Once food production became subject to market imperatives, once land access became market-dependent, foundation was established for generalizing market dependence throughout society. Coercion is hidden and is the real invisible hand.

This unique system of market dependence possesses specific systemic requirements and compulsions shared by no other mode of production: the imperatives of competition, accumulation, and profit-maximization, and consequently a constant systemic requirement to develop productive forces (Wood, p.100). These imperatives signify that capitalism can and must constantly expand in ways unlike any other social form. It can and must constantly accumulate, constantly seek new markets, constantly impose its imperatives upon new territories and new spheres of life.

Crucially, agrarian capitalism rendered industrialization possible, not the reverse (Wood, p.146). English agriculture’s transformation was primarily social revolution – transformed property relations and productive imperatives, not technological. Techniques like convertible husbandry, drainage, crop rotation weren’t radically novel but systematic applications of known methods. What changed was social imperatives compelling their systematic application. Technology didn’t create capitalism; capitalism created the imperative for technological improvement. And this does not mean technology would not have developed but for capitalism, but just that it would have developed over a longer period of time de hors forces of compulsion.

In pre-capitalist societies with markets, the market was opportunity to invest surplus. But it didn’t determine social reproduction or impose systematic compulsions. Only when property relations transformed such that access to means of production and subsistence became market-dependent did the market become imperative– a force commanding behaviors under threat, generating capitalism’s distinctive dynamics: relentless productivity improvement, systematic accumulation, continuous revolutionizing of production, constant expansion, at the costs of whatever comes in it way – subsistence of those who are unable to win this competition, environmental impact, impact on human development, etc.

If capitalism arose from particular historical transformations rather than inevitable progress, it can potentially be transformed through creating different social relations. Capitalism is not history’s endpoint but a specific mode of production with a specific origin that may have a specific end.