On a related note, it is not only the state that can coerce. Private economic power rarely lacks some coercive aspect. Think of the power your employer has over you, or the power that the banking industry has in contemporary capitalism. Market power (the power to influence price determination and revenue flows; discussed in detail in Chapter 4) and the employment relation both have coercive elements that work through the supposedly consensual exchange relation. Banks can push through laws in their interest because they can use their market power to disrupt the whole economy—to coerce the government to meet their demands. Your boss can require you work faster, or smile wider, with the threat of losing your job. That is coercion.
The combination of coercion and consent (operated by both capital and the state) produces a relation known as “hegemony,” a term first elaborated in this sense by a justly famous pre–World War II Italian communist named Antonio Gramsci. Gramsci spent the last decade of his life in Mussolini’s fascist prisons, during which time he penned a remarkable collection of notebooks that have, since their posthumous publication, joined the ranks of the most influential works of radical political thought ever written. Gramsci was the kind of radical anticapitalist theorist that even those opposed to “theory” admire, since his theoretical efforts were always aimed at making sense, for political work, of the concrete contexts in which struggle unfolded. I cannot recommend reading his prison notebooks highly enough (and for those familiar with his work, you will hopefully recognize his inspiration in this book).
Gramsci worked out his idea of hegemony while he was reading the work of Lenin, trying to understand the means through which communism might reconfigure the political and ideological terrain of interwar Europe, Italy in particular. In that context, fascism and liberal democracy seemed to direct the to and fro of everyday life so powerfully that, in many instances, the state and its allies did not even need to monitor the security of capitalist social relations. Those relations seemed so natural to most people that they reproduced the system themselves. In Gramsci’s formulation, this was a product of capital’s hegemony, its power to shape the “common sense” we tacitly share about the state, the ruling classes, and their power: that those relations are natural, that they serve a necessary function, that they are the only way to keep the peace. Those in power construct an effective hegemony when the existing order appears to be not only in their interests, but in everyone’s interest. It is the practices that render a given social formation ideologically “normal.”
The main point is that when thinking about the two constitutive logics of power in capitalism, we must remind ourselves that neither of them are “pure.” Many ways of exercising power coexist, and none can be separated from other axes of social difference that have been used to dominate different times and places, such as racialization, patriarchy, and nationalism. Nevertheless, I believe it is helpful, at least as a “first cut,” to think of the two types of power as having different dynamics. They also have specific spatial implications.
The spatial dimension often gets overlooked, but it is important. Different types of power operate in, and produce, different kinds of space.20 On the one hand, power in capitalism can focus on bounding and exercising control within specific territories. Inside that bounded space, whether it be the home country or a colony or something else, the state does its thing, controlling, deciding, coercing, convincing, etc. When those exerting this kind of power want more of it, they tend to try to expand the territory, so that it includes more people and resources. When the state exercises its authority in this way, capital can clearly benefit by producing goods and services in the territory, extracting natural resources and distributing them between the colony and the metropolis, and so on. This “territorial” logic, in which the state and capital cooperate, benefits both. The Spanish colonial era of the fifteenth and sixteenth centuries is a clear example of this logic: Spain territorially enclosed much of the Caribbean and the Americas in the interests of accumulation in the home country and in elite colonial outposts. This kind of power persists in our post-colonial time, for example, via the global expansion of consumer markets and production and supply chains overseen by multinational corporations like Nestlé, or by “conditional” development grants like those doled out in Africa by the Canadian International Development Agency (which require the local state to contract Canadian firms for the development work). The increasing dominance of nominally “foreign” markets and resources by capital and states based in the global North is as spatial as it is an “economic” process.
The second logic of power and space, which arguably characterizes today’s financial capitalism, is less about controlling territory, than controlling flows between or across territories. This logic of power can also be enjoyed by the state and capital together, since the state benefits greatly from the wealth generated by capital when it compels and directs the flows of goods and services. Think of the wealth generated in London and New York by the fact that those cities are the hubs of the modern financial system. England and the US would not be as globally influential as they are without this power, which is not territorial in the colonial sense. Of course, recent US and UK imperial forays in the Middle East again demonstrate that there are no pure types.
We should also note that these power dynamics are not necessarily well-coordinated or complementary, either on the part of capital-as-a-whole or capitalist nation-states. Different states and their domestic capitals can pursue different logics at the same time. For example, Spanish colonial power died at least partly because the Dutch took control of the ways that Spain financed its ventures—flows of capital beat territorial colonialism. Alternatively, US imperialism in the Arab states has long irked UK capitalists, who, though untroubled by the imperialist core of the US program of action, feel as though they were “there first” (and indeed, it was British imperialism that created many of the states in the Middle East).
In light of the history of these logics of capitalist power, Ingham makes the crucial point that it was precisely the territorial competition between states (in sixteenth- and seventeenth-century Europe, when the modern state system started taking shape) that led to the adoption of national debt as a way to finance military ventures for territorial conquest. Since the debt was financed by the emerging and newly powerful bourgeoisie—the first real capitalists, who increasingly had the money the state needed—this arrangement gave both the state and (what we would now call) capital an interest in each other’s long-term welfare. The state needed a healthy bourgeoisie to lend it money, and the bourgeoisie needed a healthy state to generate profits on its investment in government debt, in access to new resources and markets, and in production (which requires the social peace the state’s coercive power helps ensure).
This development is the basis for Ingham’s most important argument: that this interdependence of the state and its capitalist class is the historical source of the “common sense” understanding of the two as relatively autonomous spheres of social life. Since both the state and capital depended on the welfare of the other, they agreed to leave each other to their respective spheres. If capitalists demanded “freedom”—i.e., laissez-faire economic arrangements—and had the money the state needed to finance its war and imperial conquest, then it made sense for the state to back off. And in return, if the state provided capital with protection of its property rights and essential infrastructure for commerce (like roads), then it made sense to let the state do its thing.
In this relationship, the state (the realm of formal institutional “Politics,” with a capital “P”) came to be understood as providing the social container for the realm of activities we now call “the economy.” By the mid-seventeenth century, at least among the European bourgeoisie, “Politics” and “the economy” were no longer understood as one set of phenomena associated with the functioning of the national collective, but as two distinct realms of collective life. It is a basic argument, for instance, of Thomas Hobbes’ Leviathan, an occasionally notorious, oft-misunderstood, and enormously influential tract published in England in 1651. Although what Hobbes was “really” trying to say is still debated, there is general consensus that one of his key claims is that a self-sufficient “civil society” (i.e., the private economy) can thrive of its own accord only where a powerful state guarantees the social order.