How do capitalists pile up profits?

Marching against privatisation and evictions in South Africa in 2008 (Western Cape Anti-Eviction Campaign/ Wikimedia commons)

Last week, we saw how Karl Marx analysed primitive accumulation as, “the historical process of divorcing the producer from the means of production”.

But does primitive accumulation belong only to the past? After all, as we move into a new era of AI high‑tech capitalism, older displays of class power and conquest have re-emerged.

Rosa Luxemburg thought primitive accumulation was a constant feature of capitalism. In her 1913 book The Accumulation of Capital, she criticised Marx’s theory of primitive accumulation.

Luxemburg argued that capitalists always produced more than they could sell. To profit, they needed non‑capitalist societies to become new markets.

Capitalism must, therefore, constantly resort to conquest to force what Luxemburg called “natural economies” to open up to colonial powers.

There are two problems with Luxemburg’s argument. First, it was not primarily a lack of demand that drove colonialisation—it was the capitalist need for cheap labour and resources to steal.

Second, today there are few places on the planet that could be said to be “outside” the system. Yet capitalism has not collapsed.

Nevertheless, Luxemburg’s work is powerful in foregrounding ongoing colonial violence. Her approach has been developed by contemporary Marxist theorist David Harvey.

In his theory of “accumulation by dispossession”, Harvey describes how capitalism continues to steel for profit.

In his book A Brief History of Neoliberalism, he writes of the “continuation and proliferation of accumulation practices which Marx had treated of as ‘primitive’ or ‘original’ during the rise of capitalism”.

Harvey describes the displacement of peasant populations and the formation of a landless proletariat in places such as India. He looks at the privatisation of formerly common resources, such as water, and the suppression of alternative forms of production and consumption.

A powerful instrument of this dispossession is, Harvey argues, the use of credit through institutions such as the International Monetary Fund. This forces nation states to privatise their assets.

Harvey concludes that the left must focus less on workers’ struggles against exploitation and more on social movements against dispossession. This theory captured the imagination of large sections of the left. But there are weaknesses.

Harvey argues that accumulation by dispossession became increasingly important to the system because of a long period of economic crisis that began in the 1970s.

Neoliberalism, he argues, was based not on generating wealth, but on redistributing existing wealth from the mass of the population towards the upper classes or from countries in the Global South to richer countries. During neoliberalism, Harvey writes, “accumulation by dispossession became the dominant form of accumulation”. But this underplays the continuing importance of the exploitation of workers in the Global North.

Harvey includes different processes in his accumulation by dispossession, many of which are general features of capitalism.

One of his examples is Enron, the giant corporation which stole from pension funds and axed unprofitable branches of its business empire. But such closures and takeovers are endemic to capitalism.

Competition drives companies to take over rivals and incorporate or close them. Marx called this the concentration and centralisation of capital.

Harvey champions working class struggles that take place at the point of production. But he frames such struggles as echoes of the past.

And he sees a gap between working class struggles and popular movements over issues such as privatisation. But popular movements against privatisation have always been important elements of working class resistance.

The struggles of the working class and other oppressed peoples are intertwined. The fight against exploitation, state coercion, colonial violence and access to natural resources are the same fight—a fight a united working class has the power to win.