So the key to capitalism is: what is owned and who does the owning.
- The capitalist is a private individual. Not a state or monarch.
- They own part or all of a business. This ownership includes a right in how the business operates and a share of the profits.
- These businesses provide goods or services in markets in exchange for money (revenue).
- That business employs workers to do the work (frequently but not necesarily). Paying these workers is a source of cost.
- The difference between the revenues & the costs of the business is the profit.
Q. Now why is this bad?
A. The owners of business exploit the workers.
N.B. There are plenty of businesses where the owner & the worker is the same person. These sole traders make up about 14% of the UK workforce
I once had a discussion with an SWP member where he stated that these people were exploiting themselves.
So what do we mean by exploit?
The capitalist makes a profit - i.e. the workers do not get the full total of their labour. The capitalist who does not labour gets something for nothing. Which is unfair. But how do we measure fairness? To what extent to employees of large firms exploit each other: "I work twice as hard as Smith but only get the same pay" N.B. This is not just true of private sector organisations but public sector organisations too. Most of the recent inequality scandals have centred around executive pay - and execs are not "capitalists" in the trad sense of the word - they are managers (who may own some stock in the company but derive income from wage packets rather than stock dividends - altho the vogue for gratuitous stock options does muddy the water).
The picture of "capitalists" and "workers" in the discussion so far has been quite a 19th century one. The factory workers, covered in grime, toil for 14 hours a day whilst the fat "owner" smokes a cigar & fiddles with his pocket watch. Or even a developing world one - where sweat shop labours also toil long hours for minimal pay.
And what about the worker who owns stock in her company - are they worker or capitalist?
Who are these capitalists? Well, in the UK: 1. Foreigners, 2. Insurance Companies & 3. Pension Funds.
So if you have money in a pension fund - then you are a capitalist.
I would suggest that the arguments against capitalism are less against capitalism as a specific institution and more against: 1. Injustice at a global or local level and 2. Against a culture that values gaining personal wealth above all other attributes. Which is not to say that capitalism is not complicit in both of these things (esp. the latter) but that it is not identical to them.
Or to put it another way:
What about socialism/communism/anarchism/feudalism (delete as appropriate) prevents it from being exploitative or obsessively focused on one aspect of life at the expense of all others?