In my last piece, I argued that we can’t understand modern capitalism – or UK politics – without understanding asset ownership. I talked about recent analyses which argue that the big winners under financialised capitalism are mainly ‘rentiers’ – people who extract profit by controlling scarce resources – and that asset ownership has reshaped class relations across the economy.

But is this really a new phenomenon? We might be tempted to think so. Indeed, many recent analyses focus on the last four decades of neoliberal policies as the source of this ‘landlord economy’. To an extent, they are right – if your frame of reference is confined to the UK economy in the twentieth century. It’s undoubtedly true that privatisation and lax competition policy has created a new ownership class of rentier capitalists, ending a post-war consensus built on widespread public ownership. It’s also true that the ‘Big Bang’ deregulation of finance has enabled a massive expansion of asset-backed lending and speculative trading – resulting in bubbles and crashes, as well as a prolonged house-price boom.

But this is far from the beginning of the story. To really understand these developments as part of the history of capitalism, we need both a longer and a wider perspective. Most urgently, we need to confront the history of colonialism and empire. I am still in the foothills of my own journey towards understanding this – and the fact that I have been able to build a career in the new economy movement without having done so, testifies to our shocking neglect of this history. I certainly have no claims to being an expert. But I wanted to share some of what I’ve learned so far, and how it has already radically shifted my perspective.

As soon as you scratch the surface of the history of empire, it becomes blindingly obvious that the landlord economy is nothing new. In fact, Britain’s development as an industrial and financial centre was built on asset grabbing – specifically, the violent expropriation of land, natural resources (such as gold), and human bodies from other parts of the world. Moreover, the process of turning these people and lands into financial assets – into items of property that could be valued, borrowed against and monetised – was a crucial part of the rise of the City of London.

Gurminder Bhambra argues that we simply can’t understand the history of global capitalism without putting these dynamics front and centre. Accepted versions of this history fail to do justice to the pivotal role of colonialism, she says, calling it “the greatest blind spot of political economy”. Correcting this blind spot is essential not only to having an accurate understanding of the problem, but also to ensuring we don’t advocate the wrong solutions.

For instance, she notes how during the conquest of the Americas, land was constructed in the imperial imagination as a ‘universal commons’ or virgin territory, freely available to Europeans to divide up. In fact, it was already being used and governed by indigenous people who had to be violently expropriated in genocidal campaigns. This process was foundational not just to the development of capitalism, but of democracy: ideas of citizenship based on property ownership systematically excluded those – like indigenous people – who were deemed incapable of owning property. Viewed in this light, it becomes obvious that if we advocate for a politics of democratic ownership without confronting the history of colonialism, we are almost bound to perpetuate racialised injustices.

Of course, there was another category of person excluded from citizenship on this basis: those who were themselves property, that is, slaves. British people would love to think that this story isn’t relevant to us. But Nick Draper at UCL has used the records of the Slave Compensation Commission to map how slave-ownership permeated the upper echelons of British society at the time of abolition. He estimates there were around 2,500–3,000 people who lived in Britain and owned slaves as “absentee landlords” (Draper’s term) – representing a small proportion of the total number of owners, but who nevertheless owned around half the total number of enslaved. Some of these had acquired plantations in the colonies before returning home to live off the resulting rents. But this was only part of the story. The other – and the one that has really shocked me and drastically altered my perspective – shows how slave ‘assets’ in the 1830s were already financialised. There are hideous parallels between the practices Draper documents and the practices of modern financial capitalism – but the assets in question here are literally black bodies.

Some slave-owners were widows who had inherited slave property which provided them with an annual income – people like Dorothy Little, widow of the Rector of Hanover, who received an annuity from the Clergy Fund of Jamaica. This is not dissimilar to the way we now cash in our pension pots to provide us with an annual income in retirement. Some were banks, who had lent money to planters using their slaves as collateral, only to then seize ownership of these ‘assets’ when the loan could not be repaid – in the same way a bank today would repossess a house if someone defaulted on their mortgage. David Hall, partner in the merchant firm Hall McGowan, was one of around 150 that took compensation after making loans that were secured on the bodies of slaves. According to Draper, this credit-intensive activity tended to be concentrated among the most wealthy and powerful firms in the City: the top of the banking system is thereby implicated in slavery.

When slavery was abolished, far from being ashamed of their past role in the practice, these owners were only too eager to step forward and monetise their assets by claiming compensation. To make this happen, those assets had to be valued. This process involved estimating the expected future value of the slaves’ labour to their owners – just as financial assets today are valued based on the revenue streams (i.e. rents) they might generate in the future. But of course, there was one huge difference: these ‘assets’ were human beings.  Four enslaved women from Honduras drowned on their way to ‘valuation’ – but their owner was compensated anyway.

What all this shows is that slave ownership turned black bodies into financial assets, and that in turn this process was part of the development of finance itself. Moreover, their owners even then constituted a privileged class of capitalists. Slave traders lobbied for compensation after abolition, but never got it. Yet even most abolitionists never questioned the right of slave owners to be compensated for the loss of their property.

Draper argues that Atlantic slavery was neither dominant nor marginal to the City of London’s development at this time. But of course, this is only a small part of the picture of colonial rent extraction. According to some scholars, when we look at the whole picture, it becomes increasingly hard to sustain the idea that extractive finance is anything new. Kai Koddenbrock, Ndongo Samba Sylla and Ingrid Harvold Kvangraven cast doubt on the idea that finance has in recent decades become uniquely divorced from the ‘real’, or ‘productive’ economy. Rather, they suggest that the extractive relationship which always characterised finance in the colonies is simply coming home: “Only core economies, those having escaped the most vicious distortions brought by imperialism, can imagine that the normal operation of finance under capitalism is to support production.”

They illustrate this by looking at Ghana and Senegal, arguing that during the colonial period, the shape of finance was always dictated by the needs of colonial investors rather than those of the domestic economy. Far from supporting domestic entrepreneurs, it actively suppressed them to protect big imperial firms from competition. Meanwhile, they suggest, the extraction of domestic savings back to the City of London often outweighed British investment in the colonies. Once again, this story cannot be separated from the ownership of land and people. The Banque du Senegal was created in 1853 under an indemnity policy in which French and Senegalese traders were given shares based on the number of slaves they held. British banks could not have lent to Ghanaian smallholders even if they had wanted to, since colonial laws did not recognise African private property in land.

Of course, this isn’t to say there is nothing new about modern financialised capitalism. The sheer scale and complexity of financial activity that has been enabled by deregulation and modern financial ‘innovation’ has allowed the system to float ever freer from its precarious roots in the ‘real’ economy. This does feel meaningfully different from a situation where capital was extracted from colonies to fuel productive investment elsewhere (say, in British railways). But perhaps, as these authors suggest, the differences are less important than the similarities. Many of the things that so outrage us about the way finance operates – most starkly, the way basic resources are turned into financial assets and used to funnel wealth upwards – were essential to the modus operandi of colonial capitalism.

This matters today for a whole range of reasons. For one thing, we need to acknowledge the legacy of these practices in domestic and global racial inequalities. According to the Runnymede Trust, Black Caribbean British people have 20p of wealth for every £1 owned by White British people; for Black African and Bangladeshi people, the figure is 10p. We need to confront the uncomfortable truth that this is at least partly down to the historic gulf between people who were forcibly turned into assets, and those that owned them. We need to have a proper debate about reparations for what was taken.

In the US, this debate at least exists. Indeed, the community land trust movement grew partly out of the need to provide routes to ownership and secure housing for urban Black Americans who had been historically locked out of wealth. There are active discussions today about how these land justice movements can be linked with reparative justice, and the role of wealthy white people in this process. In the UK, we have preferred to bury our heads in the sand – resulting in movements for democratic ownership that are too often white, middle-class and race-illiterate.

We also need to look beyond Britain’s shores and take a global perspective. As the Runnymede Trust researchers note, “even radical economic thinking too often treats the economic ‘system’ as an enclosed domestic space”. This allows us to look back with rose-tinted glasses at the post-war era – when all citizens were supposedly given a stake in the common wealth – without expanding our frame to those who were denied these rights of citizenship. As Bhambra puts it: “in what is distributed, where was the surplus generated that is redistributed?” These are the basic questions we need to ask today: what resources are generating this wealth? Who owns those resources, and how did they get them? Who – if anyone – has a right to own those resources? We cannot answer these questions properly if we limit our frame of reference to the UK domestic economy.

Finally, as Bhambra suggests, we may need to “orient our conceptual understandings of capitalism away from the primary focus on the capital-labour relation”. If “other forms of appropriation” – such as the state-backed seizure of land, resources and people – have always been central to the way capitalism operates, does this change the way we should think and organise? In my next piece, I’ll explore this question further.

In the bibliography below, you can find references to some of the research used within Christine’s article, as well as additional resources to explore the topic further.

Christine Berry is an Autonomy Writer in Residence. She is a freelance researcher and writer based in Manchester. She is a Trustee of Rethinking Economics, a Fellow of the Democracy Collaborative and a Contributing Editor of Renewal journal. Previously she was Director of Policy and Government at the New Economics Foundation. She is currently writing a book on democratic ownership as part of the answer to rentier capitalism (Verso, 2022).