Capitalism and Republics: A Mutual Relationship



 Many want to change the world, but few care to do the work of understanding it. If one wants to change the current paradigm, one first must come to an understanding of how it operates. One of the most crucial things to understand is the manner in which republican forms of government and capitalist varieties of economy are mutually-reinforcing. Without such an understanding, one is tempted to reform various aspects of the system, never realizing the futility of such an approach. It is not possible to challenge capitalism with the present electoral system, without shifting it instead toward state socialism, which is no more—perhaps less—desirable. Nor is it possible to change the present system of representative government while using a currency that is supplied by its chartered banks. The two arose together, and must fall together. As I have written much on the topic of what is to replace capitalism, republics, and the state, as well as on the nature and origin of the state itself, this piece will instead focus on the origins and nature of representative government and capitalist economy. This is in hopes that a) government will not be seen as an alternative to capitalism, b) capitalism will not be seen as an alternative to government, and therefor c) a revolutionary approach will be adopted by the reader, which strays from both capitalism and state-socialism, and which better approximates geo-mutualism.


 A republic refers to a system of governance in which citizens—enfranchised members of the state— elect public officials, who act according to the rule of law, often founded on a constitution.

Is a republic a democracy? Yes and no. In the loosest sense of the term, a republic is a democracy, because citizens do vote. In a pure, or direct, democracy, however, citizens do not vote for a legislative branch of government, but vote on all major issues that affect them. In this sense, a republic is distinct from a democracy. A republic is not a pure, or direct democracy, but a republic is a representative democracy. That is, a republic is a democracy when generally speaking, but is not a democracy when being more specific.

Specific Republic Democracy
General Representative Democracy Direct-Democracy

In a direct-democracy, citizens legislate law themselves by voting on it. In a republic, they vote for representatives to legislate law on their behalf. Republics are often supported over democracies based on the premise that representation is more expedient, allows for more specialization, and for better judgment.

In a representative democracy, or republic, there are typically three branches: executive, judicial, and legislative. The legislative branch passes laws, the executive branch puts them into practice, and the judicial branch enforces them. There are various “checks and balances” built into the system.

If a citizen wants to impact the laws of a republic, on one scale or another, the main legal method of doing so is to campaign for a representative who promises to do something that the citizen likes, or to try to appeal in some form or another—either through intellectual persuasion (which rarely works) or through pressure—to existing representatives to get something desirable done. As representatives rely on the votes of the citizen to remain in office, they often bend to pressures when they become strong enough, but especially when they are pressed by potential or actual constituents with lots of wealth and power, be they private individuals or lobby groups. These kinds of pressures—private capitalists, landlords, creditors, as well as organized groups such as business unions and special interests— have much influence over the process of political nomination and campaigning. This is especially true of the pressures of the big bankers. The common citizen has little to no power to legally influence the decisions of their government, having little to no time and resources with which to apply social or economic pressures. Laws which would benefit the common citizen, by removing privileges of economic elites, are unlikely to be passed, let alone proposed. Any politician who proposes such a mechanism can expect to be ostracized by the elite members of society, who also run the media and fund their campaigns. This ensures that capitalism persists.


 Capitalism refers to a market economy in which the government upholds laws that support the private monopoly of land and capital, and in which debtors, workers, and tenants are allowed to choose their providers of credit, employment, and land to rent.

Is capitalism the free market? No. While many use the term capitalism to refer to the freedom to exchange possessions, this is not the historical understanding of capitalism, which is much more related to state-protected monopoly of land, credit, and capital. Capitalism refers to a particular condition of a market economy, wherein there are people who do not have access to their own land, cannot print their own currencies, and have no capital, and who must instead rent land from others, borrow their money, and face life-term employment by others.

In the system of capitalism, there is always a private individual standing between those who possess property (land, credit, capital)—the tenants, debtors, and workers— and having legal title to it. These are the private landlords, private bankers, and private capitalists.

Capitalism exists only by the fact that the state stands by to protect the interests of private property, an institution on which capitalism rests. Private property, in this more formal historical sense, refers to property which is owned by and benefits private individuals, but which is used by others. Examples include the property of an employer, who may themselves not do much of the daily work, but who usurp much of the income produced from the work of their employees for the use of his or her property; a landlord who does not have any personal use for a piece of land, but who extracts rent from the sharecropper for its use; or a banker who faces no risk in their loans, but extracts interest from them nonetheless. Private property refers to property which is rented in some form, such as money loaned at interest, a factory loaned to workers (called employment) for profit, or land loaned to a farmer for rent. This is to be distinguished from what is called personal property or possessions, which refers to property which is generally used by its owner, whether an individual person or an association of some sort. An owner-occupant, owner-operator, and member-owner describe individuals who are using personal, rather than private, property, so long as they are not making a living from renting out their property (as with bosses, landlords, and creditors). Private property is the foundation of capitalism, and is itself a form of ownership tinged with monopoly, and enforced with the violence of the state. Private property cannot exist without violent enforcement, while personal property exists by mutual necessity.

 Republics and Capitalism

 Republics and capitalism share an important relationship, in that both are purported to be what they are not, and both, while being preferable to their predecessors (monarchy and feudalism), depend on coercive hierarchical authority in order to function.

Whereas a republic makes use of authoritarian representation in the political sphere, capitalism makes use of authoritarian representation in industry. As there is no pure or direct political democracy where there are legislators, there is no pure or free market where there are private monopolies. Republics are defined by their legislators, and capitalism by its bosses, landlords, and creditors.

Both capitalism and republics disallow direct-action on behalf of the lower members of society, but leave decisions relating to law and policy to representative members of society, such as politicians, who have been entrusted to run government for the benefit of capitalism, and private monopolists, who have been entrusted to run the economy for the benefit of the republic. If a citizen wants change, they must elect or ask a politician to change things for them. If a worker wants change, they must pick a boss who will do what they like, or ask their existing boss to change things. The same goes for the tenant and the debtor. They, too, must ask a representative to do something in their interest. If the citizen wants lower taxes, or for taxes to be better spent, they must ask the government, whose members benefit from high taxation, and enjoy spending the money of others without hesitation. If the worker wants higher wages, he or she must beg of it to come from what would otherwise be the boss’s profits. If the tenant wants lower rent, it will cost their landlord one of their vacations. Naturally, the privileged classes have no desire to do away with their privilege, and when given the option to retain it, or to voluntarily forfeit it, few choose the latter option.

 Intertwined in the Enlightenment

 In order to understand the relationship between republics and capitalism, it is necessary to look at their common roots during the Enlightenment, and how they developed from the Medieval period. Renaissance exploration into the humanistic ideas of the Greeks had begun to spawn inquiry outside of Church dogma and toward the natural world and humanity’s innate abilities. This set the stage for folks like Baruch Spinoza to usher in the Enlightenment, which was concerned more with social issues, relating to governance and economy, lifestyle and culture. Whereas the Renaissance had been about spiritual self-awareness, the arts, and humanities, and carried with it many religious themes, the Enlightenment developed as a reaction to the oppression of many of the more modern religious and scientific views, as well as to an increased awareness among the merchant classes about political economy, thanks largely to the work of the Physiocrats and Adam Smith during the mercantile stage of feudal-capitalism.

The Enlightenment was ushered in, in part at least, by such ideas as the Republic of Letters, a culture of liberal letter-writers, who believed that the power of well-spread enlightened thought had the potential to render governments relatively powerless. Their networks extended across national boundaries, adding to their influence. Another group, the Freemasons, spread Enlightenment ideas in their lodges. The Freemasons played an integral role in the founding of the United States. Looking at their history can demonstrate the combined interests of capitalism and republicanism as part of the explanation for their near-simultaneous social adoption. Capitalists (here used in the loose sense to refer to any private monopolist) and politicians share a similar interest.

In the case of the Freemasons, Freemasonry developed from long-standing, but now fugitive, guild traditions. The name, Freemasonry, may refer historically to a class of laborer (freemen, or specialists given more autonomy), or to the fact that the Freemasons were practicing civil disobedience by keeping guild traditions alive after they had been outlawed by the states of Europe. Their being outlawed is why it was necessary for the Freemasons to operate as secret societies. The Freemasons developed from stonemason’s guilds, some of which had been deployed in the Crusades, along with Holy Orders, such as those of the Knights Templar and the Knights Hospitallers. Together, the skilled architects of castles and the holy military orders uncovered the secrets of the Eastern world, including Ancient Greek philosophy, Jewish banking, Muslim mathematics and economy, Zoroastrian, Jewish, Muslim, Hermetic, and neo-Platonic cosmological and spiritual views.[1] They also discovered many items desirable for trade. The exposure to the East gave the Holy Orders and the craft guilds, such as the masons, advantages in trade and bargaining that made both the religious and political elite back home—the kings, the feudal elite, the Pope, cardinals and bishops— quite uncomfortable. This eventually led to the outlawing and forcing underground of both Holy Orders and skilled labor and merchant guilds. First, the Holy Orders were outlawed, leading to the Templars and Hospitallers finding sanctuary in the craft and merchant guilds with which they had associated, and promoting their traditions within them. Later, merchant and craft guilds of various sorts (originally organized for the purpose of protesting feudal tax practices, but evolving into corporations benefitting from patent-protection) were outlawed, forcing the master guildsmen underground with the rogue Orders. Among the survivors, the Freemasons seem to have been the most prolific and adaptable, eventually showing a public face again in the 18th century.

By the time of the Enlightenment, the concerns of the day shifted from the cosmological, theological, and metaphysical disputes of the Renaissance toward social, political, and economic concerns. Renaissance awakening underwent a lot of repression by the authorities, who saw free thought as a challenge to their power. While much of the conversations of the Renaissance continued on into the Enlightenment, the repression of this thought shifted much of the concern to the protection of freethinking, which entailed political and economic changes, as were expressed in the Republic of Letters, and as was endorsed as a practice within the structures of freemasonry.

Freemasonry is officially apolitical in regard to national politics, but its internal republican practices were integral to the overthrow of the British during the American Revolution. Like the Holy Orders and the guilds from which Freemasonry had sprung, and taking much inspiration from the Greek and Roman republics, the Freemasons practiced republican governance within their organizations. Their membership, like most secret societies of the day, was well-to-do and aristocratic, mainly beneficiaries of the prosperity that had been brought to the West after its exposure to the East. In the Americas, they were usually land-owners, and in the Americas and Europe alike they tended to be capitalistic merchants of various sorts. It is here that the establishment of modern capitalism and republicanism share a root. While the Freemasons may not be the only actors of this period, a study of their history will uncover general trends in the Enlightenment. They act as a fine model for radical Enlightenment free thought amongst the aristocratic classes of the period. Of course, the general culture is most at play, and groups like the Freemasons are just expressions of the cultural outlook of the day.

The American Revolution was organized largely out of Freemasonry and similar fraternal organizations and merchant’s clubs. The “Headquarters of the Revolution,” as it was called, was the Green Dragon Tavern, which was also the St. Andrews Lodge of Freemasonry, headed by Master Mason, Joseph Warren. From here the Boston Tea Party was planned, and Paul Revere set about on his ride. It’s no secret that George Washington was also a Freemason. The main organization of the revolution, the Sons of Liberty, was started and led, in part, by Freemasons and others of a similar outlook and culture. The Boston Caucus, an organization which orchestrated a false public democracy, in order to get public support for the causes of the merchants, met at the Green Dragon Tavern, and was orchestrated largely by Freemasons. The decisions were actually being made in what is called “smoke-filled rooms,” in which the well-to-do members of secret societies made decisions and then manufactured public consent to them. Eventually it would be only white, land-owning, males that were allowed a vote, according to the Articles of Confederation.

The point of all of this history is that capitalism and republics are intertwined and are mutually-necessary, which is why they have co-arisen. Republics were established by merchants to overthrow monarchies, so that they could live their dreams out as capitalists. The establishment of secret societies and gentlemen’s clubs—republics which would evolve to overthrow and replace monarchies— occurred in order to protect the interest of capitalists from monarchies. After finding success with this, they turned their energy to repressing the lower classes, as in Shays Rebellion. This conflict shifted the direction of the country from an Athenian-style direct-democracy for the rich, as was presented under the Articles of Confederation, to the republican government we are used to under the present Constitution. This change was sponsored by the Federalists, largely in order to protect their interests as private-property owners against the lower classes of society, who had not benefitted much from the American Revolution. They saw in Shays Rebellion a threat to their interests as capitalists, landlords, and bankers, and established a republic in order to protect their interests. Also true is that soon after, George Washington, who had fought against the tyrannical taxation of the British, rode as a tyrant to impose the Whiskey Tax during the Whiskey Rebellion. The corruption continues into Fries’s Rebellion. Eventually, the Anti-Masonic would form as the first third-party in the United States.

 Republics Reinforce Capitalism and Protect Private Property

 In the present system, members of the capitalist class (bosses, enfranchised professionals, landlords, creditors) are always elected as representatives, and always maintain the dynamics of capitalism, from which they benefit. The republican system ensures that the mechanisms that keep capitalism in place—especially private property in real property and monopolistic control over the money supply—, remain. The mass majority of people do not benefit, but rather suffer, from private property and monopolistic control of the money supply. They are unable to challenge the conditions of capitalism within the constraints of the republican governmental system. Representatives are always of the capitalist class, and appeal to the capitalist class, as only the capitalist class has the means to fund a political campaign. The mass majority of people do not benefit from political representation.

Even the most left of center candidates get their funding from the union bosses of the business unions. These would-be officials of state-socialism have just as much potential for abuse as private capitalists. Let us not forget the role the soviets (workers’ councils, unions) played in establishing state-socialism in Russia, or, even how the syndicates and fasces (unions) established the national-capitalism (fascism, which is falsely called “national socialism” but is more related to capitalism or feudalism) of Italy and Germany in the early to mid 20th century. The only unions worth messing with do not run political candidates or take part in electoral politics. Even if capitalism could be shifted away from, using the political process, the resulting state-socialism would be quite undesirable.

Some cling tooth and nail to the system, tirelessly campaigning against war, for universal healthcare, or for third parties of various sorts, for instance. They are unwilling to hear the message of the revolutionary, that the system cannot be reformed for the benefit of the lower classes: the worker, the tenant, the debtor, and the common citizen. They exhaust themselves sending letters, holding signs, and going on marches, arguing for their party and their candidates, always placing their future into the hands of the system and its officials, never claiming a future of their own. This sort of activism usually comes from those who are not directly disenfranchised by capitalism, but who otherwise do not like what is going on; usually middle class do-gooders, such as independent business owners or skilled professionals of various sorts. At times, rebellious young people from middle and upper class homes can also be found “Summer squatting” in activist movements, particularly those that could become riotous, or conflictarian. These youth are often part of a trainhopping and hitchhiking culture. Very few lower class people are found involved in political campaigning, or taking much of an interest in political matters.

 Solving the Problem

 The solutions of the problems of political and economic representation are political and economic direct-action. That is, rather than asking for permission, or to be represented by a certain class of individuals—politicians, bosses, landlords, creditors, etc.—, citizens need to implement direct-democracy on their own behalf, need to work in cooperation without bosses, need to challenge the power of the landlord, and produce their own credit in union with one another. The ideology I feel best exemplifies such political and economic ends is the geo-mutualist panarchism that I support.

Similar to the necessity of representative democracy to the support of capitalism, free markets depend on direct-democracy. As republics arose from the demand for protection of private property from monarchs, democracy will arise from the demand for protection of personal property from the republican state. When capitalism and republics replaced feudalism and monarchies, the nation-state also replaced empires. Similarly, free markets and democracy will see the replacement of the nation-state with panarchy. Free markets must replace capitalism, democracy must replace republics, and panarchy must replace the state.

It is not enough for a market to be free. So long as individuals act completely autonomously, they will not be reaching their full potential. Economic cooperation and mutual aid are necessary for the flourishing and prosperity of a society. Thus, strict individualism is to be transcended for the ends of cooperation.

It is not enough for a democracy to be direct. So long as individuals exist at the whim of the collective, there cannot be said to be freedom or equality of persons. Unanimous consent is necessary for the flourishing and prosperity of the individual. Thus, strict collectivism is to be transcended for the ends of voluntarism.

The pursuit of voluntary cooperation is ultimately the pursuit of anarchy, and the abolition of the state, capitalism, and representation. Such ends can only be brought about through the direct-action of those who benefit from such change, representatives will never do away with themselves, so long as they benefit from their positions of power, nor will the propertied do away with their private claims on their own. Thus, anarchists have taken to the methods of direct-action, employing concerted activity in actions of civil disobedience, such as strikes, boycotts, occupations, and expropriations. They have proposed syndicalism and agorism as dual-power mechanisms of change.

For a rich alternative to the present system, I suggest a study into the program of geo-mutualist panarchism. The geo-mutualist model supports the common ownership of the Earth, mutual ownership of natural monopolies, cooperative management of associations, and access to capital and credit. It does away with political and economic representation by politicians, bosses, landlords, and the like.

[1] Along with the plague, the crusades left much nobleman’s property to be squatted by the lower classes of feudal society. This gained hand in material possession for the peasants and the artisans would also play a crucial role in the development of capitalism and republics.


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