Laleh Khalili’s Extractive Capitalism: How Commodities and Cronyism Drive the Global Economy, published by Profile Books, looks at how primary commodities are excavated and sold, as well as the roles played by management consultants, insurance brokers and so on. In this excerpt, Khalili looks at the origins of commodity traders—“crucial cogs in the machinery of extractive capitalism,” and their relationship with state power. For instance, she notes of the largest oil-trading company, “Vitol was lubricating the war in Libya at the behest of foreign powers,” but the company’s chief executive, Ian Taylor, “claimed his actions were not political.”
“This seems to be the mantra of the titans of commodity trading interviewed by Javier Blas and Jack Farchy in The World for Sale: ‘We are just here for the money; we are not doing politics.’ I suppose it all depends on what you take ‘politics’ to mean,” Khalili writes.
Anything can be turned into a commodity. Humans and their labour, flora and fauna, livestock and crops. The ocean yielded not only pearls and fish but whales, whose oil was used in lamps before a technique was developed to transform petroleum into kerosene. Anything extracted from the earth can be commodified: oil, and all the metals—copper, mercury, lithium—that industrial production and commerce have depended on.
Commodities from the colonies and the trade in enslaved people were the lifeblood of early European capitalism. Commercial contracts and financial devices became instruments of conquest, colonisation and commodification. Futures contracts, as we have seen, have become lucrative—if abstract—commodities; by the mid nineteenth century, futures contracts at the Chicago Board of Trade for grain, timber and meat had surpassed cash trades. As the historian William Cronon wrote in Nature’s Metropolis, “one could buy, sell and settle up price differences without ever worrying about whether anything really existed to back up contracts.”