As Joan Robinson once observed, defining ‘capital’ is a painful subject for economists, who commonly ‘set up models in which quantities of “capital” appear, without any indication of what it is supposed to be a quantity of’. Some, however, have offered an answer. For the dominant neoclassical tradition, capital names the assets—tangible or intangible, machine or know-how—that are used to satisfy needs. For an older tradition, adopting the practical language of businesspeople, capital is simply a fund of money put to work by the investor. Yet these static descriptions shed little light on the peculiar dynamism of their object. How is it that this thing, capital, grows through time, generating streams of income for its owners? The responses provided by economists have often confused explanation with apologia. Marx ridiculed the nineteenth-century dogma that profits are a reward for the capitalist’s abstinence in foregoing consumption. A more intuitive account centres the bold actions of the entrepreneur. It is the latter’s innovation—technological or organizational—that secures the superior growth of the capital under their supervision. Thus, ‘without entrepreneurial achievement, no capitalist returns and no capitalist propulsion’, Schumpeter claimed.
In his latest book, The Alibi of Capital, Timothy Mitchell sets out to dismantle this received wisdom. Look at Uber, he suggests in the book’s opening pages. The ride-sharing company had its Initial Public Offering in 2019, achieving a stock market valuation of $82 billion. Did this eye-watering number reflect the frugality of Uber’s owners or the novelty of its technical innovations? No. Uber had been burning through investors’ cash for a decade without ever earning a profit; its app was nothing out of the ordinary; it owned no cars; its foray into self-driving vehicles was a flop. The technologies it did rely on—smartphones, gps, the internet—were developed in part through public funding. What Uber’s valuation really represented was the monopoly position that the company was projected to achieve in the years to come. By offering ultra-cheap fares (subsidized by its venture-capitalist backers), manipulating municipal regulations and undermining local public transport systems, the company would drive competitors from the field, after which it could freely prey on drivers and passengers alike. By 2023 the profits had begun to flow, making good on its prior valuation. People and planet are left footing the bill.
Uber’s case is well known, but it hints at a larger phenomenon. ‘Capital is not something saved up from the past’, Mitchell writes, whether machinery, knowledge or finances. Such backward-looking accounts obscure an uglier reality: capital is ‘a capture from the future’. The key is the process of ‘capitalization’, whereby a future income stream—tax revenue, mortgage payments or corporate earnings—is transformed into a present financial asset. When a company goes public, floating its shares on the stock market, it is selling discounted claims on its prospective profits. These profits derive more often than not from ‘an encumbrance imposed on the firm’s future customers and workers and on the communities and ecologies to which they belong’. Instead of competing to offer more and/or better goods and services at lower prices, in Mitchell’s account companies engage in what the father of institutional economics, Thorstein Veblen, called ‘sabotage’: they exclude rivals with the help of political authorities, eschew costly innovations, manufacture scarcity, drive up prices, sell flimsy products and run roughshod over the environment. Present stock market valuations are an index of the capitalized burden inflicted on the future. Competitive innovation, the satisfaction of demand, growth—for Mitchell, these are ‘alibis’ for capital’s true mechanism of time-bending financial predation. But is this all there is to it? Is capitalism’s seeming technological dynamism and expansionary character, noted by its defenders and critics alike, simply a ‘misdirection’?
A leading political theorist and historian at Columbia University, Mitchell is the author of a series of books—covering colonial and contemporary Egypt, as well as the Anglo-American grip on Middle Eastern oil—that have helped reshape their fields. Born in 1955, he graduated from Queens’ College, Cambridge with a history degree, an education in Marx and a warm interest in the Arab world, where he had travelled in the wake of the 1973 Israeli–Arab war. Mitchell’s first book, Colonizing Egypt (1988), emerged from his doctoral research in political science at Princeton, which he entered in 1977. Reacting against the department’s prevailing positivism, he turned to Heidegger, Derrida and Foucault to frame his investigation of the forms of representation—exhibitions, models, urban plans—produced by the colonization of Egypt. Mitchell’s thematic aperture widened in Rule of Experts (2002), published during his tenure at New York University, which attempted to apply the actor-network theories of Michel Callon and Bruno Latour to the changing political economy of postcolonial Egypt, examining the work of economists, public hygienists and engineers. This Latourian, object-oriented approach became more prominent still in his widely lauded Carbon Democracy (2011). Written in the aftermath of the us invasion of Iraq, Mitchell offered not only a powerful indictment of Western depredations in the Middle East, but a sweeping history of oil, democracy and reaction, in which the physical attributes of different energy commodities are understood as actively shaping political outcomes. The bulkiness of coal, for example, which meant that large amounts of human labour were required to extract and transport it, gave political power to workers who could disrupt crucial chokepoints—power that was then weakened by the rise of an economy based on fluid oil.
At first glance, the focus on stock-market dynamics in Mitchell’s most recent book may seem to mark a stride into new intellectual territory. Yet many of the topics and conceptual commitments that have marked his previous work resurface here, too. Mitchell defines the book’s aims as, first, to explore—in the case of cities, infrastructures and fossil fuels—how collective life came to be organized on the principle of impoverishing the future to enrich the few; and, second, to examine the concepts—demand, growth, innovation—used as ‘alibis’ for this process. At the same time, The Alibi of Capital is part of a growing body of scholarship on the practices of accounting, credit creation and asset formation that make the modern economy run. Mitchell’s own approach cleaves closest to that of Veblenian scholars Jonathan Nitzan and Shimshon Bichler, who—in Capital as Power (2009) and later work—reject production-based economic theories in favour of an account of capital as ‘finance, and only finance’. Yet unlike much of this literature, and in keeping with his Latourian sensibility, Mitchell is keenly attentive to the built environments, or ‘technosphere’, upon which practices of financial extraction rest. Traditionally, economists have understood infrastructure as a means of speeding things up and improving connectivity; credit simply facilitates this laudable endeavour. Mitchell insists that the reverse is true: infrastructure is a vehicle for capitalization through credit creation. Take the nineteenth-century railroad boom. Thousands of miles of track were laid—‘railroads from nowhere to nowhere’ in many cases, as Cornelius Vanderbilt once remarked—for the chief purpose of extending credit, selling shares and pocketing windfalls. The same holds for the dams, cities and energy networks that have remade our planet, Mitchell argues. Instead of improving efficiency, infrastructure-owners and property developers often introduce delays and disruptions that allow them to impose higher prices. These physical structures, and the financial instruments spun off them, are machines for accruing fares, tolls, rents and other sorts of ‘tribute’ far into the future.
These ‘terraforming’ projects, Mitchell reminds us, have ‘tended to be colonizing in form’. Revisiting a theme from Rule of Experts, he examines how British capitalists, technicians and imperial authorities in Egypt transformed the River Nile through a series of engineering works, culminating in the spectacular Aswan Dam that graces The Alibi of Capital’s cover. The project, begun under the British but completed in 1970, was justified with narratives of modernization: controlling the Nile’s floodwaters would allow for the industrial-scale production of export crops like cotton and sugarcane, through which Egypt could be integrated into world markets. In the most fascinating section of his book, Mitchell shows how the British dam eliminated centuries-old local practices for managing the river’s flow through a system of animal-driven waterwheels or saqiyas, which allowed for the irrigation and cultivation of various crops, from sorghum to indigo. The results were catastrophic. Mitchell charts how the dam disrupted the Nile’s fluvial dynamics and ecosystems, inundated vast swathes of Nubia, lowered crop yields and caused an explosion in diseases like malaria. Some benefited though. The dam had been capitalized by an equally complex piece of financial engineering, which saw ‘irrigation certificates’ sold to global investors that would later be paid back from tax revenues squeezed out of the same Egyptian farmers who were now facing depressed yields. The project’s original financier, the British banker Ernest Cassel, made a killing from fees, interest and the higher value of the sugar plantations and cotton estates downstream of the dam which he had cunningly bought up. Instead of innovation or the meeting of needs, Mitchell finds only spoliation—in other words, capital.
While some Veblenian literature on capitalist finance is also strongly Keynesian in character, such as the work of Jonathan Levy, The Alibi of Capital differs on this count too. For Keynesians, all investments face a deeply uncertain future. Big corporate valuations are sometimes validated by future profits; but sometimes they are not, leading to stock market volatility. For Mitchell, however, the idea that the ‘future exists mainly as prognosis’, as a ‘range of possible “outcomes” that might be conjectured from a knowledge of the past’, is naïve. While it’s true that ‘some speculations can fail’, the future is ‘fabricated and projected in concrete ways that are organized, calculated, acted upon’. At times, Mitchell portrays financial plunder as inexorable, lacking internal contradictions and sprawling across centuries and continents. ‘The future’, he writes somewhat cryptically, borrowing from Deleuze and Guattari, is ‘an elaborate apparatus of capture’.
One might question this portrayal of capital as fundamentally parasitic by pointing to the productive dynamism inaugurated by Britain’s nineteenth-century industrial revolution. But Mitchell pre-empts this objection. Industrialization, he insists, was simply a ‘detour’ taken by rent-seeking financiers. The political dislocations that shook the world from the United States’ War of Independence to the end of the Napoleonic Wars interrupted global trading networks. Merchant capital, which profited from financing long-distance trade along monopolized routes, was diverted into English cotton mills, spurring the industrial revolution. In this way, ‘finance was industrialized’, Mitchell argues. But not for long. Industry, it turned out, was physically dangerous (even, at times, for capitalists), competitive and not particularly profitable. Many mill-owners quickly realized that they were ‘more interested in becoming rentiers than the unrewarding work of manufacturing’. Over the second half of the nineteenth century the production of goods therefore ‘gave way to other apparatuses of capture . . . especially those operating through renewed powers of imperial expansion’—joint-stock infrastructure projects of concrete and steel like the Aswan dam.
In addition to such durable physical infrastructures, Mitchell argues that capital-as-capture also relies on certain forms of knowledge. In keeping with his past work, he stresses the performative force of economic ideas. Surveying an array of thinkers, from Weber to Hernando de Soto, he shows that concepts like ‘the market’, ‘the economy’ and ‘growth’ are more than representations of an external reality—they are instruments for the stable ordering and measurement of social life, on top of which structures of capitalization can be erected. For instance, the deployment of concepts such as gdp in the postwar period provided a new ‘invariant standard’ in place of the old gold-based monetary regime, Mitchell observes, thereby anchoring credit creation as well as providing policymakers with a rationale for limiting workers’ wage demands. By drawing and redrawing the boundaries of the market, by producing new modes of measurement and calculation, economic ideas provide the rails on which capital runs. At points in the book, Mitchell calls this mode of governance ‘economentality’, a nod to Foucault’s notion of governmentality, or the ‘EconoCon’, an unfortunate play on Panopticon.
The book finishes by reading the climate crisis against this longer history of capture. Much of this conclusion summarizes the argument of Carbon Democracy, which similarly borrowed from Veblen to explain how fossil capitalists and their allies built enormous fortunes through the strategic sabotage of energy production and distribution. The ‘great acceleration’ in carbon emissions since the Second World War, Mitchell tells us, was chiefly the result of the oil dependency imposed by a group of highly capitalized corporations, most importantly the great oil monopolies, but also real estate developers, automobile firms and arms companies, which sought to establish a society of cars, suburbs, petroplastics and gas-guzzling militaries from which they could capture future payments. It is these concrete practices of political manipulation and financial exploitation—not nebulous phenomena like growth or capitalist development—that account for global warming.
The Alibi of Capital poses profound questions. ‘How does capital consume the future?’, Mitchell asks. ‘And how are we made blind to this?’ His answers, however, while studded with rich historical insights gleaned from a great diversity of sources in multiple languages, sometimes obscure as much as they reveal. The central problem is the book’s one-sided account of capital as rent-seeking. Behind Mitchell’s occasionally arcane language (the shareholder company is an ‘apparatus for colonizing time’; the factory a ‘technopolitical time machine’) is a straightforward argument about the rentier practices of publicly traded monopolies. In this sense, the book is part of a broader wave of recent literature on ‘rentier capitalism’ (Brett Christophers), ‘political capitalism’ (Robert Brenner and Dylan Riley) and ‘neofeudalism’ (Jodi Dean). Much of this thinking follows Marx in identifying capitalism as a competitive, technologically vigorous mode of production—albeit one that is ceding ground to monopolization in certain industries. In contrast, Mitchell’s Foucauldian instincts lead him to view such grand claims as obfuscations of something more troubling: capital has always been fundamentally rentierist. To speak of competition, technological innovation or growth risks giving an alibi for this bitter reality.
Indeed, Mitchell accuses many thinkers of peddling in alibis. His critiques of their ideas tend to follow a formula: he points out that a certain theory relies on historically situated forms of knowledge; he disputes the accuracy or universality of this knowledge; and he thereby questions the thinker’s broader conceptual framework. Schumpeter’s theory of innovation, he argues, used a misleading example of sugarcane cultivation derived from his personal experience managing a sugar company in Egypt. Adam Smith’s theory of the division of labour rested on inaccurate studies produced by the French Academy of Sciences on the manufacture of dressmakers’ pins. Marx apparently derived his concept of abstract labour, on which his theory of capital hinges, from reports by reform-minded English factory inspectors who had an interest in emphasizing the brutal homogenization of industrial work (contra a century of ‘form analysis’ scholarship, stretching back to Isaak Illich Rubin). What appeared to these thinkers as core facets of capital in general were really historical contingencies. Yet one could turn Mitchell’s own method of intellectual history against him. He conflates a prominent feature of our present moment—in which every few weeks some destructive, parasitic business venture achieves an astronomical market valuation—with capital per se. He sees Ubers everywhere he looks.
This weakness is illustrated by Mitchell’s effort to dispel what he considers to be misconceptions about the industrial revolution. He repeats several convincing, albeit well-established, objections to the traditional cotton-based narrative. Transformations in the British cotton industry were exceptional, rather than representative of a broader technological shift. Cotton fabrics were of low quality in comparison to the more durable garments that they replaced. Changes in manufacturing were sometimes motivated not by a search for higher productivity, but by a desire to dominate workers, as Andreas Malm has argued in the case of the steam engine. Technology is not a ‘self-moving force of improvement’, Mitchell insists. So far so good. But he pushes further, and in doing so makes strange intellectual bedfellows:
the rapid increase in production and wealth associated with the so-called industrial revolution was for the most part not the result of technical transformation. Most of it, in fact, can be attributed to increases in population. Mechanization did not produce material growth.
This bold claim is backed by one citation—to the work of the neo-Malthusian scholar Gregory Clark. Clark’s full argument, developed in his book A Farewell to Alms (2007), is that Britain owed its industrial revolution to the procreative success of its wealthiest families, whose multiplying offspring spread their heritable bourgeois traits of thrift and hard work throughout society; however, population growth smothered the gains from industrialization until the late nineteenth century. Clark’s argument has been roundly debunked by one historian after another, not least for his ludicrous biologism, but also for his underestimation of the growth-spurring effects of technological change, during and before the industrial revolution.
Mitchell, as we saw, casts nineteenth-century industrialization as merely a detour between two rentier regimes (confusingly, he also calls capitalism itself a detour). After a brief period of painful competition, manufacturers either fled to other sectors or formed joint-stock companies and cartelistic trusts that capitalized on their market power. Capital as capture could then resume. The problem, however, is that history didn’t end with the robber barons. Mitchell has nothing to say about the anti-trust movement, the fierce global competition sparked by Japan and West Germany in the postwar period and later by the so-called Asian Tigers, or the ascent of leaner, more efficient capitals in the rich countries. These and other developments combined to drag many of the gilded-age monopolies back into the competitive fray. Corporations have managed to re-establish monopoly positions in some sectors since the 1980s—a powerful tendency in capitalist history that Mitchell is right to explore. But this process is far from complete. Mitchell’s argument strikes a particularly discordant note at a moment when imports of cheaper and often superior Chinese products—from metals to cars to semiconductors—are causing panic in Western corporate boardrooms. Bafflingly, he mentions contemporary China only once, when he suggests that the Belt and Road infrastructure initiative is a means for perpetuating ‘financial extraction’ from the Global South, in line with the widely criticized trope of China’s debt-trap diplomacy. The ruinous competition, technological dynamism and chronic overproduction that characterize Chinese capitalism are not addressed, presumably because they sit uneasily with the book’s central argument.
Instead of monopoly (or ‘capture’) vanquishing competition, the two logics are in fact locked in continuous tension with one another. This plays out not only across different historical periods, as sketched above, but also across economic sectors. Infrastructure, real estate and oil—the things that Mitchell is primarily interested in—are notoriously susceptible to monopolization because rivals cannot easily enter the market. But ‘capital’ is not made up solely of sectors like these. For many manufacturing and service industries, competition is extremely difficult to evade. The same tension is present in the supply chains that make up individual sectors. While lead corporations can earn rents from their intellectual property, this simply offloads competitive pressure onto their suppliers, which are often trapped in a vicious struggle to cut prices or face losing tenders. Finally, the same corporation may earn both monopoly rents from things like branding and profits from competitive innovation, further muddying the waters. ‘In practical life’, Marx wrote in The Poverty of Philosophy (1847), ‘we find not only competition, monopoly and the antagonism between them, but also the synthesis of the two, which is not a formula, but a movement’. If capital were simply capitalized theft, the economy’s lifeblood would quickly be drained. This was the case in many pre-capitalist societies, where lordly depredation contributed to regular social crises. But capitalism does not display this pattern because modern rent-seekers, unlike their feudal forebears, are parasitic on an economic body that relentlessly expands through time. The future would not be worth capturing otherwise.
Mitchell’s one-dimensional focus on rentierism reveals its limits when it comes to the book’s goal of explaining ‘why we now face the catastrophe of climate collapse’. His position is unequivocal: ‘The great acceleration of recent decades, and the climate collapse it has brought upon us, were driven not by the general development of capitalism, nor by its need for energy, but by the specific forms of capitalization that could be manufactured through a carbon-heavy form of life’. There is some truth to this—oil companies and their allies certainly conspired to enrich themselves at the planet’s expense. Yet even if we were to accept the far-fetched notion that rising oil use from the middle of the twentieth century had nothing to do with the energy needs of a growing and globalizing world economy, this would still be an insufficient explanation for climate change. The great acceleration saw booming consumption not only of oil, but of gas, coal and wood fuel—plus wind and solar power since the 2010s. The famous hockey stick graphs show spiking consumption of almost everything: water, concrete, metals, paper, fertilizers and so on. More and More and More (2024), Jean-Baptiste Fressoz’s aptly named book, meticulously traces the compounding, uncontrolled manner in which the modern economy devours the planet’s resources and spills greenhouse gases into the atmosphere (a process that Fressoz can describe but not explain, as Thea Riofrancos has observed).
Mitchell tries to hedge: ‘There is no denying that some processes have unfolded at accelerating rates, such as the extraction of coal and oil. But we also know that other things decrease, such as the extent of rainforests or the amount of most people’s leisure time’. Therefore ‘growth’ is inappropriate as a ‘general term for our relationship to the future’. This is particularly unconvincing. If capital is indeed geared towards growth, or more precisely what Marx called ‘expanded reproduction’, wouldn’t we expect this to manifest itself in the increasing extraction of energy resources, depletion of ecosystems and exploitation of our lifetimes? Ultimately, while the business practices explored in The Alibi of Capital—manufactured scarcity, disruption, delay—are real and entail their own environmental harms, they cannot account for this pattern of boundless expansion. The climate crisis has been primarily driven not by capital’s planned sabotage of the productive forces, but by its blind development of them.
Consider the steel and cement sectors, which are together responsible for half of all industrial carbon emissions. Mitchell is interested in these materials insofar as they contribute to the physical durability of rent-capturing infrastructure projects. But they are industries in their own right, and their business dynamics illustrate the limits of his argument. Oil consumption is not the biggest culprit here, nor is any energy source: steel’s carbon emissions come primarily from the use of metallurgical coal as a reductant, while cement’s come from the calcination of limestone. Firms in these sectors would love to be the rapacious monopolists that Mitchell describes—limiting supply, raising prices and enjoying sky-high valuations. But they cannot. They tend to operate in competitive markets, which pushes them to adopt new production technologies that expand output and cut unit costs. In the mid-nineteenth century, for example, the best available steel technology was the puddling furnace, which could produce around three to five tons of steel in 24 hours. Today a basic oxygen furnace can churn out 400 tons of steel in 40 minutes. With skyrocketing output comes rising carbon emissions, as well as the growing extraction of coal, iron ore, limestone, gypsum, sand and other resources, carving great wounds in the Earth’s crust.
The environmental harm caused by steel and cement firms is not commensurate with their market power. The same expansionary dynamic that is choking the planet also regularly results in glutted markets, falling prices and low profit rates. Firms try to escape these conditions through collusion and consolidation, but they’re often foiled by the rise of new competitors at home and abroad, or by the legal judgements of competition authorities. The result is big emissions and tight margins. Cement production releases around 7kg of carbon dioxide for every dollar of revenue, compared to less than 1kg for oil and gas. The fact that the ‘steel and cement industries operate with very low profit margins in very competitive markets’ is also a key reason why firms have been so reluctant to make expensive decarbonization investments, an oecd report argues. Such industries, it turns out, are more effective at obliterating the future than capturing it.
The Alibi of Capital gives little indication about what is to be done. But in the 2023 preface to Carbon Democracy, Mitchell provides some reflections. ‘A more democratic and equitable energy system’, he writes, ‘would allow the capitalization only of the mechanisms necessary to supply power, not of the future revenue that would flow long after those costs are paid off’. Limits should be placed on ‘the apparatuses of credit that give shareholders and other powerholders in the present a control over revenues in the future’. This may feel inadequate to the scale of the climate crisis, but it follows logically from Mitchell’s analysis. If the problem is predatory financial practices, rather than capitalism’s basic social relations—relations of property and exchange, of monopoly and competition—then better regulations might just do the trick.
By contrast, Veblen, whose enigmatic writings are a core inspiration for Mitchell’s later work, is refreshingly blunt. In The Engineers and the Price System (1921), he imagined how the absentee owners of industry in the United States, those who restrained production in order to enlarge profits and validate their firms’ capitalizations, might be dispossessed. In their place, a ‘Soviet of technicians’ with the requisite expertise in the ‘industrial arts’ would plan and run ‘the economic affairs of the country’ on the basis not of ‘commercial profit and loss’, but rather ‘care of the community’s material welfare’. The technicians would work in ‘consultation with a sufficient ramification of sub-centres and local councils’, and would require the continued ‘support of the industrial rank and file’. Freed from the grip of ‘business’, production could rise by up to 1,200 per cent, he believed.
We might query several aspects of Veblen’s vision. It is explicitly technocratic. The channels of democratic participation are vague. Its productivism, its desire to perfect capitalism’s industrial engine, appears naïve in an age of interlocking environmental crises. Indeed, capitalism turned out to be highly capable of rapidly expanding production without dismantling the joint-stock company. Veblen’s rejection of the ‘vested rights of property’, on the other hand, continues to ring true. It is after all the institution of private property that enshrines the capitalist’s right to pursue either parasitic rent capture or reckless output growth. ‘Private property is a knife that cuts both ways’ in this regard, the political economist Javier Moreno Zacarés writes. It is today cutting us off from a liveable future.