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Capitalist competition holds back progress

This article is over 11 years, 9 months old
We’re told that capitalist competition is what drives society forward. This myth is central to how capitalism justifies itself.
Issue 2318

We’re told that capitalist competition is what drives society forward. This myth is central to how capitalism justifies itself.

But the madness of the system was shown up last week when US courts sided with the richest corporation in history over mobile phone design.

They ordered South Korean manufacturers Samsung to pay Apple £665 million pounds for ripping off elements of the design of their iPhone. Apple has effectively fought for a legal monopoly over rectangles and rounded corners.

In a separate case in South Korea each firm has had products banned after copying the other. Samsung made it easier to scroll in a window while Apple connected to 3G networks. So some of the best products have been taken off the market—because they infringe copyright.

The tiff between Apple and Samsung shows how firms’ jealous guarding of their profitable monopolies gets in the way of innovation.

Outside the courtroom these two companies are hardly bitter enemies—they are both part of the same lucrative supply chain. More than a quarter of every iPhone has been built by Samsung, making Apple its biggest customer.

It probably doesn’t matter very much to the workers who make the gadgets which global brand their work is contracted out to. They work in the same hellish factories employed by contractors such as the notorious Foxconn.


The consequences of intellectual property laws can be deadly. Pharmaceutical firms stop patented medicines being sold to the poor. Millions die every year from preventable diseases. Bosses say this is the tragic price we must pay to give them an incentive to research new drugs.

But the effect is the opposite. It makes it more profitable for companies to try and work around each other’s patents than to pursue risky original research into curing new diseases.

The revolutionary Karl Marx called the class of capitalists “a band of warring brothers”. Bosses are constantly scheming up ways to do each other over. That brings instability to the system that revolutionaries can exploit.

But they are united in squeezing every last drop out of profit out of their workers—and they won’t give a penny back without a fight.

The idea that competition is in workers’ interests is a lie. But it’s a lie that the Labour Party doesn’t seem to have grasped. It is backing Richard Branson as he begs to hang onto one of Virgin’s juiciest contracts for West Coast Main Line trains.

Labour politicians see competition as the only way to organise society. But the chaos and destruction caused by capitalist competition shows why we need to fight for a different system.

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