The rise and fall of national capitalism

Abstract

AbstractFor three millennia, there has been a conflict between landed military power (the traditional enforcers, now nation‐states) and urban commerce (capitalists, now a lawless global plutocracy). This ancient battle was resumed by the European Renaissance, culminating in industrial revolution around 1800. This seemed at first to be a victory of the money interest over landed power. In the mid‐nineteenth century, however, the capitalists discovered that they could not manage without crowd control by the traditional enforcers, a compromise between money and landed power (business and government) that unleashed “national capitalism” in political revolutions involving the leading powers of the last century. These generated mass production and consumption at home and a global takeover by European colonial empires, both enabled by a bureaucratic revolution first proposed by Hegel. National capitalism—a merger of industrial capitalism and the “nation” by strong states attempting to modify the former's contradictions through central bureaucracies acting in the interest of the citizen body—became the main form of society after the Second World War, first through developmental states varying from socially responsible capitalism in the United States through social democracy in Europe to communism in the Soviet bloc, with the newly independent former colonies divided between the antagonists in the Cold War. Undermined by financial imperialism in the last four decades, this system is now failing, but humanity is far from achieving a world society to replace it.