That Old Transition Question

How to get from barbarism to socialism?

We’ve been suspended in our 1850s moment for quite some time, maybe even half a century, thinking we had won the ideological war—of course all men are created equal, nobody still believes that everything has a price—but now watching in despair as the forces of reaction reshape the institutions and the discourse, to the point where we can feel that the republic is expiring as we speak. Still, there are reasons to hope.

In the 1850s, hope sprang from two sources. On the one hand, Conscience Whigs like Ben Wade and Free Soil Democrats like Charles Sumner got elected to the Senate from Ohio and Massachusetts. They had been outspoken critics of the Fugitive Slave Law passed in 1850 by a Congress that wanted to put the issue of slavery to rest, so that it could get on with the business of forming new states in the federal territories of the Louisiana Purchase—the project that would sooner or later require trans-continental railroad building.

On the other hand, the Whig Party collapsed in 1853-54, allowing activists, politicians, ideologues, and opportunists (like Wade and Sumner) to create a new party dedicated to keeping slavery out of those territories. It collapsed because the Whig leadership couldn’t muster an adequate response to the Slave Power’s increasingly aggressive—and successful—attempts to commandeer the federal government, the culmination of which was the abrogation of the Missouri Compromise in the Kansas-Nebraska Act of 1854, the legislation that opened the entire Louisiana Purchase to slavery.

But that leadership’s inadequate response wasn’t due to a lack of vision, or imagination, nor a result of ineffective “messaging.” By the early 1850s, the Whig Party had a large and growing anti-slavery constituency that was begging to hear its voice in Congress, in policy proposals, but the leadership couldn’t satisfy that constituency and meanwhile keep the merchants, brokers, and bankers of the seaboard cities—who had a vested interest in the expansion of slavery—as supporters and donors. So Whig leaders kept compromising with the Slave Power until it was too late to do anything else; at that point, they stood for nothing except their own re-election.

In our time, hope springs from similar sources. The electoral earthquake that is the movement convened by Bernie Sanders, AOC, and now Zohran Mamdani was first signaled by the tremors felt in Occupy Wall Street, which was itself a seismic register of the Crash and the Great Recession that followed (and on the other end of the political spectrum, the Tea Party and its Christian Nationalist progeny look like the contemporary equivalent of the anti-immigrant “Know Nothing” Party that emerged in the wake of the Kansas-Nebraska Act). Mamdani’s win in the NYC mayoral primary was so resounding—such an overwhelming repudiation of the status quo’s complacence, but with a pragmatic programmatic edge instead of a merely radical rage against the machine—that it can’t be dismissed as an inimitable anomaly.

Alas, there is no immanent collapse of the Democratic Party that would open the electoral field to the many voices and tendencies of the Left. But the comically inept response of the leadership to Trump’s cruel, brazen, corrupt, and unconstitutional assault on everything American (except spastic violence, unbound greed, and reflexive support for Israel) has made the party’s “brand” near toxic. That in itself is an opening for the Left. For its source is at least analogous to the source of the Whig leadership’s timidity in confronting the Slave Power and in cultivating an anti-slavery constituency—the fear that wealthy supporters and donors from the coast(s) would desert the party if the leadership entertained programmatic alternatives to the status quo. The gratuitous attacks on Mamdani are ugly manifestations of that fear, and they will surely alienate the large and growing socialist constituency within the Democratic Party (just as the leadership’s attacks on Conscience Whigs alienated the party’s anti-slavery constituencies in the late-1840s and early 1850s).

Extraordinary political developments like these usually come late in the historical sequence we call revolutions, which are themselves not detonating events but are rather condensed registers of vast changes that were evident yet unknown until they were articulated in words and deeds—which, when their salience is realized, popularized, and codified in programs and at the law, will accelerate those changes to the point where anything seems possible, even The Terror. To put it another way, revolutions are endings that are also beginnings. In Marxist terms, they preside over transitions from one mode of production to another.

Since 1990 (in a graduate seminar at Rutgers), I have been arguing that the transition from capitalism to some kind of socialized mode of production got underway in the 1890s, when the creators of the new, vertically integrated corporations separated ownership and control of the means of production by turning day-to-day decisions about the allocation of industrial resources over to salaried managers—in a move analogous to what much of the landed aristocracy of England had done in response to plague and peasant revolt after 1350, by turning day-to-day decisions about the allocation of agricultural resources over to rent-paying commoners.

The vast changes set in motion in the 14th century wouldn’t be fully articulated in words and deeds until the late-16th century, but when their salience was finally realized, popularized, and codified, the immediate result was the English Revolution, a.k.a. the Civil War or the Puritan Revolution. In the longer run, the result was of course the transition from feudalism to capitalism. But this latter result wasn’t named, let alone understood, until the 19th century, when Marx seized on the findings of Adam Smith, David Ricardo. and G. W. F. Hegel to explain how Locke supplanted Habbakuk.

So it’s not surprising that the vast changes set in motion a century ago by the corporate reconstruction of American capitalism are evident but still unknown. We haven’t yet found the right words to express them. But the answers to our very own transition question are all around us—as long as we grasp the simple fact that the ongoing transition from capitalism to a socialized mode of production can’t lead to democracy if we reduce the goal of socialism to state command of markets.

I tried to get at some of these answers in my review of John Cassidy’s new book, Capitalism and Its Critics (2025), now published in Project Syndicate. Here’s the passthrough (free) link, courtesy of my brilliant editor there, Jonathan Stein: https://www.project-syndicate.org/onpoint/end-of-capitalism-but-not-of-markets-by-james-livingston-2025-07?

Meanwhile, here are the paragraphs from the review that are relevant to this post.

__________

But then markets and capitalism aren’t the same thing. So the title of Cassidy’s book is happily misleading—he doesn’t introduce us to an anti-capitalist literary canon, he offers us ways of asking not whether but how markets can and should be regulated in the name of the common good.

For markets, money, commodities, merchants, private property, long-distance trade, insurance, banking, and profit motives, even advertising, were visible, measurable, and consequential long before capitalism emerged in the 16^th century, and even longer before capitalism became the dominant mode of production in the course of the industrial revolution, as wage labor became the typical source of income for the majority of producers (at least in Europe and North America, which thereafter colonized the entire planet). Markets and their armature are perfectly consistent with societies in which slavery, misogyny, and many other forms of savagery thrive, as the example of the antebellum South amply attests. But the modern market society known as capitalism was not, as the Civil War would suggest—not until economists like Milton Friedman reduced it to the gospel of greed, and CEOs like Jack Welch acted on their injunctions to ignore all incentives other than short-term profits.

How, then, are we to distinguish between societies with markets and market societies, and to differentiate between stages or kinds of market societies? That is the question of periodization raised by the emergence of capitalism, which Marxists have typically framed as a “transition question”—why, where, how, and when did capitalism erupt from the wreckage of feudalism, they ask, and, being critics of capitalism, when, where, and how will the transition to socialism be accomplished? What was so new and different about capitalism that it revolutionized the production of goods, the scope of politics, the role of families, the content of society, and the meaning of selfhood, not to mention the consciousness of historical time required to recognize these changes as irreversible departures from the past? Will the successor to capitalism make for change of this magnitude—or will there ever be such a stage of civilization?

The transition question, so conceived, isn’t a matter of merely antiquarian or sectarian interest. What comes after capitalism has recently become an urgent social question that demands practical answers, because the labor market, never a perfect register of supply and demand—nor a reliable means of delivering incomes commensurate with effort—now threatens to collapse under the pressure of generalized artificial intelligence. The urgency derives from the simple fact that what distinguished capitalism from all previous modes of production is the conversion of the specifically human need to work, and of work, into a commodity that, once divided into homogenous parcels of time, could routinely be bought and sold. It would seem to follow that if the market in labor collapses, so, too, does the social edifice built upon this foundation. Is capitalism collapsing? Or just evolving into something that we can’t yet name?

Consider the immediate threat to the labor market as understood by Dario Amodei, the CEO of Anthropic, the company that has developed Claude in competition with Open AI’s ChatGPT: “AI could wipe out half of all entry-level white-collar jobs—and spike unemployment to 10-20% in the next one to five years,” he told Axios in a May 28 interview. Steve Bannon, the media-savvy culture warrior, agrees with that apocalyptic assessment: “I don’t think anyone is taking into consideration how administrative, managerial and tech jobs for people under 30, entry-level jobs that are so important in your 20s, are going to be eviscerated.”

But we’ve been hearing this kind of talk since the 1950s. The difference between then and now is that “automation” as driven by AI can replace white-collar employees because it has cognitive capacities that robots don’t, including the Adamic ability to think that it can deceive its maker. That’s a significant difference because the growth of employment since the 1920s has been concentrated here, in the so-called service sector, where “manual labor” means dexterity and a soft touch, not physical strength.

Consider also another of Bannon’s concerns, “techno-feudalism,” the name for a post-capitalist stage of development made popular by Yanis Varoufakis, the Greek economist and leftist politician. It has two salient features. First, its rulers, the “cloud capitalists” who own the digital platforms (Amazon, Google, Apple, et al.) do not generate profit, they extract rent from both producers and consumers by exercising their monopoly powers over the distribution of goods. Second, these so-called capitalists realize value by colonizing and monetizing leisure time, that is, the time spent after work hours—by selling the data they collect when consumers use their devices or servers to browse the internet in their “free time.” A surplus of labor power becomes superfluous labor because the production of value no longer requires the subordination of labor power to capital at the point of goods production. That means the end of capitalism as we know it, or at least as Marxists have defined it.

So the transition question we are now facing makes John Cassidy’s book much more timely, useful, and important than it would seem if all he has done is assemble critics of markets, not of capitalism. For if capitalism is on the verge of extinction, markets are certainly not. Not even avowed socialists are still willing to claim that central planning is a viable alternative to enfranchising consumer choice in the relevant markets, thereby letting the varieties of public opinion determine investment decisions as they now shape political decisions. We need exactly what Cassidy has provided, then, a panoptical scan of the criticisms writers on both Left and Right have offered of markets, from the moment when a market in labor became a normal dimension of everyday life, in the late-18^th century, and thus created a modern market society, down to our own time, when participation in the labor force no longer seems to matter in the creation of value or the development of character. . . .

Cassidy’s book makes the transition question of our time both poignant and practical. It certainly makes us ask hard questions, regardless of where we place ourselves on the political spectrum. Questions such as these: Is capitalism worth preserving if markets have stopped working under its aegis—that is, if everybody knows by now that the issue is not whether but how to regulate markets? What social purposes do markets actually serve? Does the labor market, for example, allocate incomes in accordance with past effort, learned skills, and natural talent, or has the relation between work done and wages received become inexplicable, totally arbitrary? . . .

Perhaps the hardest question is not whether but how moral questions—what we owe one another—reside in and flow from behaviors specific to markets. Does character still get built by having a job, working for a wage? Or has it by now become obvious that only chumps believe that if you work hard and play by the rules, you’ll get ahead—that gangsters and pimps like Donald Trump do better than anybody because there are no rules, not anymore? If morality is as foreign to what markets contain and permit, as the conservative defense of the family against the intrusions of the commodity form would strongly suggest, are we obliged to subordinate markets to social purposes as these can be articulated in public, political discourse?

Cassidy doesn’t pretend to have the answers, but that is the strength of his book. He has given us the intellectual resources to ask the right questions.