By Christine Berry

February 5 2021

From the global financial crash to the Covid pandemic, the last decade or so has seen a resurgence of efforts to understand what makes modern capitalism tick. Who gets rewarded, how, and for what? What is driving today’s toxic combination of stagnation, instability, inequality and environmental collapse? And if capitalism really is in a death spiral, how might we get out of it?


Complex questions have complex answers, and I’m not one for silver bullets. But it’s increasingly clear that we cannot answer these questions without understanding asset ownership. The UK is an extreme example of what I call the ‘landlord economy’: an economic system built on rising asset prices (especially in housing), and a political system structurally favouring their owners.


For a while, it seemed like this system was capable of delivering reasonably widespread prosperity: first through Thatcher’s Right to Buy, which created a generation of home-owners, and then through the explosion of credit under New Labour, which papered over low wages via access to mortgages. Income from wealth replaced income from work as the engine of the economy, while the security of asset ownership replaced the security of a job for life and the welfare state.

A broken model

But nobody can seriously claim that this settlement is working any longer. Rising house prices have left an entire generation locked out of home ownership. Average living standards, already stagnant for decades, now look set to fall during the ‘long Covid’ recession. Meanwhile, wealth continues to trickle upwards: recent research suggests that the top 1% own almost a quarter of all UK wealth, even more than had previously been thought. Even through the pandemic, the wealth of the super-rich keeps booming – not because they are saving more, but because the value of the assets they already own keeps climbing.


Thomas Piketty’s influential 2014 book, Capital in the Twenty-First Century, argues that this inequality engine is inherent to capitalism: over the long run, returns on capital will always outstrip economic growth, and hence the living standards of the many in turn. The main political impact of Piketty’s work was to popularise the idea of a wealth tax. But to address the roots of our current crises, we need to go deeper. We need to unpack how common resources have been enclosed as private assets, understand how those assets shape the economy – and ask how we can reclaim them through democratic ownership.


Of course, the yawning gap between work and wealth is partly explained by the systematic dismantling of trade union power, and the resulting imbalance of power between labour and capital. But there is another dynamic at play. The biggest winners in our economic system increasingly derive their wealth from activities that, at face value, may have little to do with work at all.

Rise of the rentiers

In his new book Rentier Capitalism, Brett Christophers takes a tour through the ‘commanding heights’ of the UK economy, showing how they are all shot through with ‘rentierism’: essentially, making money by controlling scarce assets, rather than by working or producing anything new. Property developers control land; utility companies control access to energy and water; banks control the money supply. He argues that this is the deliberate result of neoliberal policies which systematically expanded markets for private ownership of assets but did nothing to stop their subsequent concentration at the top.


Financialisation is the other side of this coin. The 2007-8 crisis revealed how the value of financial assets was increasingly disconnected from anything ‘real’, like the world of work or the productive economy. Of course, when asset values collapsed, this did not stop the real economy from being dragged down with them.


Rentierism is the preferred business model for today’s economic elite, since it is both easier and more lucrative than actually doing anything useful. Pharmaceutical companies’ core business focuses less on inventing and producing drugs, than milking the intellectual property underpinning those drugs via patents. Outsourcing firms like Serco might be notoriously rubbish at fulfilling government contracts, but they are world experts at winning those contracts, since these are the assets upon which their shareholder value is based.


As Lisa Adkins and her colleagues stress in The Asset Economy, rentierism is not a phenomenon confined to the 1%. The logic of asset ownership has permeated our entire society, shaping life courses and determining class relations. From this perspective, Thatcher’s mass extension of home ownership is not merely an exception to the rule of a small elite of ‘rentier capitalists’. It is fundamental to understanding how this political-economic system has created and sustained itself by building a mass constituency with an interest in the status quo.


Even those excluded from home ownership find themselves bound to the asset economy in other ways. We may have been automatically enrolled into private pensions that stake our retirement prospects on capital markets. We are even encouraged to see ourselves as assets to be developed, taking on student debt as an investment in our future ‘human capital’ (an investment, Adkins and others note, that increasingly traps graduates in a form of negative equity, given its failure to deliver its promised return of higher wages).

New faultlines

All this helps to explain why the rentier settlement has endured politically for as long as it has, even as it undergoes escalating convulsions, and begins to fail on its own terms. As Keir Milburn argues in Generation Left, it also helps to explain why that political consensus has started to fracture along age-related lines – as young people are locked out of the asset wealth accumulated by their forebears. This played out in different ways in both the Brexit referendum and the 2019 election (although of course, in both cases there were many other things going on too). Young graduates are locked in a losing battle with propertied pensioners, and UK politics now often seems driven by what Will Davies has termed ‘England’s new rentier alliance’.


As I and others argued last year for IPPR, Covid has begun to intensify these faultlines. Both the crisis and policy response look set to exacerbate inequalities between those who own assets, and those who do not. This has been described as a ‘K-shaped recovery’: asset prices have bounced back quickly, aided by huge injections of central bank liquidity, but the scarring effect on jobs and incomes looks set to last for years. From stamp duty holidays to prop up house prices, to exhortations to ‘get back to the office’ and shore up city-centre land values, the UK Government clearly has no plan beyond a desperate attempt to resuscitate the old model. If we want to understand the crisis unfolding around us, as well as imagine how we might recover from it and build something better, it’s therefore essential that we deepen our understanding of ownership. In my upcoming series of articles for Autonomy, I’ll be aiming to do just that.


I’ll ask what all this means for our analysis of capitalism, and for how we understand class, value and exploitation. Is the workplace still the primary site of exploitation and value extraction, or do we need to look elsewhere as well? If we really are heading for an age of automation and digitisation, could the ownership of platforms, data and robots become as important as the labour relation in deciding where wealth and power lies? How can we better understand the links between rentier capitalism, colonialism and slavery, and how they have reproduced racial inequalities in the past and present?


We’ll also look at how these dynamics are playing out in real time during the Covid crisis – using the future of the high street as a starting point to ask how the pandemic might disrupt the UK’s ownership economy. We’ll ask what all this means for the alternative economy we desire: how can we rediscover and renew the socialist aspiration of common ownership in an age of rentier capitalism? And, in an economy built on assets and rent, do we need to think beyond ‘the means of production’ when asking what it is that we really want to own?


If we want to understand modern capitalism and build something better, we clearly need more tools in our toolbox than the picture of a factory boss and worker that many of us implicitly carry in our heads. This is absolutely not to minimise the importance of building worker power – but rather, as Annie Quick and Alice Martin have argued, to understand the wider context that such efforts are operating in. We need to update our understanding of capital and asset ownership – so we can chart a path towards an economy where society’s resources are put to work for the common good.


I want this residency to be a conversation: if there are topics you’d like me to write about, thinkers or real-world examples you think I should be exploring, or thoughts you’d like to share in response to this piece, please let me know by tweeting @oeufling – don’t forget to tag @Autonomy_UK.

  • Adkins, L., Cooper, M. & Konings, M. (2020) The Asset Economy. Polity Press: Cambridge.


  • Christophers, B. (2021) Rentier Capitalism: Who Owns the Economy, and Who Pays for It? Verso Books: London.


  • Milburn, K. (2019) Generation Left. Polity Press: Cambridge.


  • Piketty, T. (2014) Capital in the Twenty-First Century. [trans. Goldhammer, A.] Harvard University Press: Cambridge, MA.

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).