It is a common assumption that the racism of our society originates in "human nature" or an inherent fear of the unknown. But for Marxists, the starting point for understanding the origins of racism is an analysis that centres on the capitalist system and the ruthless pursuit of profit that drives it. 

Widespread racism in Australia today leads many people to conclude that somehow ordinary people are responsible. According to commentators like the ABC's Phillip Adams, it's our narrow minds and petty frustrations that allow politicians such as John Howard and Pauline Hanson to manipulate many of us for political gain. Something embedded deep inside us - human nature, perhaps - allows racist fears to be fostered and exploited.

This assumption is shared by most historians who have written about the origins of racism in Australia. In particular, the "White Australia" policy - under which non-"white" immigration to Australia was almost entirely banned until the 1970s - is said to be the result of working class prejudice and trade union campaigns.

There are fundamental problems with this "race relations" model, and the history and politics which flow from it.

We can see this in the work of Australian anthropologist W.E.H. Stanner. In the 1960s, Stanner argued that a universal "human impulse to clannishness" leads to conflict whenever "radically different" cultures exist alongside each other.

Stanner - who saw himself as an anti-racist, advocating a deeper understanding of cultural difference - endorsed the "White Australia" policy on the basis of "experience and commonsense". People just can't get along, so better to keep them separate.

Apart from leading to deeply pessimistic and right-wing conclusions, this approach rests on a false assumption - the supposed existence of "races".

Scientifically, the idea of race is a straight-out lie. As biologist Steven Rose has pointed out, there is enormously more genetic variation within population groups than there is between any of the so-called races. There is every chance that I have more genes in common with Oprah Winfrey than with someone from Irish and English ancestry similar to mine.

The whole idea of "race", let alone the notion that some races are superior to others, is a very recent one. Famously, Marco Polo failed to notice in any of his writings that the Chinese were "yellow". The Roman Empire was similarly colour blind: at least one Emperor, Septimius Severus, who ruled from AD 193 to 211, was almost certainly black.

This points to another fundamental flaw of the "race relations" approach: it tends to ignore history. Falling back on timeless generalisations about "human nature", it cannot explain how and why sentiment about race can change so much in different places and times.

The Marxist approach to explaining racism is materialist. That is, as Marx's collaborator Friedrich Engels put it, "the simple fact, hitherto concealed by an overgrowth of ideology, that mankind must first of all eat, drink, have shelter and clothing, before it can pursue politics, science, art, religion...".

How this production is organised forms the foundation for all other social relations. Under capitalism, production is carried out for the profit of a small elite. This ruling class controls the giant companies that dominate the economy and the state institutions (the police, army, judicial and education systems, etc.) that keep that control secure.

"The ruling ideas of any epoch", wrote Marx, "are the ideas of its ruling class". The ruling class, as we shall see, benefits from and so propagates racism.

The Marxist approach to explaining racism is also historical. That is, we must look at the actual development of racism in its particular social setting, rather than relying on timeless generalisations about "human nature".

When the First Fleet sailed into Sydney on 26 January 1788, it didn't just bring convicts and their jailers: a whole set of social relations, and the ideas that justify them, was an essential part of the invading force.

One of these ideas was the notion of terra nullius, or "empty land", a legal doctrine which held that the Aboriginal people did not own their land. In one act of planting a British flag, the people of an entire continent were dispossessed.

Canadian philosopher James Tully has shown that the doctrine of terra nullius was carefully developed during the centuries-long legal and military battles in North America, as a legal justification for the seizure of Native American lands needed for cash crops such as tobacco and cotton.

A key role was played by philosopher and British Colonial Office lawyer John Locke. By collecting and distorting a vast body of evidence on Native American use of land, Locke came up with a theory of terra nullius that said that people who supposedly did not "mix their labour with the soil" had no legal title to their land.

In Australia also, the theft of Aboriginal land and the ideas that justified it have been clearly driven by the profit motive. From the 1820s, the gradual expansion of the penal colonies around Sydney gave way to a wholesale land grab. With profits to be made from shipping wool to British mills, pastoral capitalists "squatted" on land with enormous numbers of sheep, turning legal dispossession into a brutal fact of life for increasing numbers of Aboriginal people.

John Batman, one of the founders of Melbourne, was typical of this breed of capitalist. Batman expanded his wealth through generous land grants from the Tasmanian government in return for being part of several murderous expeditions against the local Aborigines.

Batman was an enthusiastic participant in the "Black Line" in 1830, when colonists fanned out over Tasmania with instructions to capture any Aboriginal people they could, and shoot those they couldn't. The aim was to clear the land of human beings, to make it safe for sheep and the workers who tended them.

The vicious racist ideas of this time were not the automatic product of racial difference - a number of colonists are recorded as finding dispossession morally unjustifiable and concluding: "let us not, therefore, persist in it".

The imperatives of expanding pastoral capitalism, however, required that the squatters and the state did persist in grabbing Aboriginal land. And racist ideas were necessary to justify this.

Small wonder that the squatters' mouthpiece the Sydney Herald mounted a vigorous defence of the men tried for raping, murdering, dismembering and incinerating 28 Aboriginal men, women and children at Myall Creek in northern NSW in 1838. In the only case in Australian history where whites were hanged for the murder of blacks, one key witness was an Aboriginal stockman working nearby. The Herald railed against "the possibility of four men's lives being frittered away upon the statements... of a young black savage, possessing no more idea of ultimate responsibility... than a baboon."

The same foul, racist ideology came in handy for the subsequent waves of dispossession, to make way for cattle bound for the world market late in the 1800s, and to enable Australian capitalism to profit from the minerals booms of the 1950s and beyond.

Long years of struggle by Aboriginal people put land rights on the political agenda in the 1970s. When the Labor government introduced national land rights legislation in 1984, the mining industry led a vigorous public campaign. Hugh Morgan, the head of uranium miner WMC, led the charge, spouting that any recognition of land rights would be caving in to "paganism, fear and superstition".

Mining capital is one of the most profitable and powerful branches of Australian capitalism. As on so many other occasions, the Labor government quickly crumbled before them.

Looking at this history, it's little wonder that even most mainstream historians assign a prominent role in promoting anti-Aboriginal racism to pastoral and mining interests, at least implicitly endorsing a Marxist approach.

Racism isn't just about ideas. The racist state established during the original acts of dispossession perpetuates its own traditions, which are continually reinforced by the actual situation of oppression. The dreadful conditions Aborigines are forced to live in, the fact that they are more likely to be unemployed or imprisoned than whites and so on, all contribute to racist stereotypes which are then used to justify their oppression. It's a vicious cycle. For example, police trained in a racist institution make assumptions based on the stereotypes and literally get away with murder; the ALP, which wants to run the capitalist state for the ruling class, always ends up taking the side of mining companies. All of this fosters the idea among whites that blacks are inferior and deserve fewer rights. The reciprocal relationship between material, social reality and ideas keeps racism alive.

A different dynamic is at work with the other form of racism rife in Australia's history - racism against non-white immigrants.

The "White Australia" policy was the first significant law passed by the new Australian parliament in 1901. Most historians stress the importance of popular agitation among diggers on the gold fields to explain this.

A close reading of the historical record, however, shows a different story.

The first law against Chinese immigration - a landing tax of £10 per head - was introduced by the Victorian government in 1855 following the Eureka uprising of December 1854. Yet the miners at Eureka had demanded no such thing!

The Chinese presence on the goldfields had been an issue earlier in 1854. In June a mass meeting on the Bendigo diggings had passed a motion opposing the Chinese on the goldfield. However a controversy followed at the next meeting, with many supporting a motion asserting "the principle of liberty, equality and fraternity among the diggers".

In Ballarat the Diggers' Advocate, a mouthpiece for the radical wing of the democratic movement, denounced the racist sentiments of the Bendigo diggers. Indeed, the only race denounced by the Diggers' Advocate was "a race of capitalists... intent on enslaving the free miners" who were "infesting" the goldfields and reducing miners to wage slavery.

This stand by some leaders of the democratic movement meant that, in the numerous other meetings that culminated in the great Eureka rebellion, not once was a demand made to restrict Chinese diggers on the gold fields.

Nevertheless the Royal Commission that followed the rebellion recommended the £10 tax. One of the commissioners was William Westgarth, one of Melbourne's most prominent capitalists and politicians, who in 1853 had campaigned for restrictions on Chinese immigration.

Chinese people were forced to camp outside the boundaries of any declared town. And new laws allowed European diggers to "jump" the claims of Chinese who could not show a receipt for the racist tax.

It was after these measures, not before, that the worst anti-Chinese violence occurred on the goldfields. In example after example, the ordinary people who were supposedly leading the charge against the Chinese were in fact following the lead given by ruling class figures.

For instance, the first union to bar Chinese people from membership was the Amalgamated Miners' Association in Victoria. Reflecting the fluid politics of the day, the union's early history was dominated by figures such as Captain W.C. Smith. A prominent mining capitalist, Smith urged the union to concentrate on issues that supposedly united the "mining community", such as opposition to Chinese labour, rather than issues that might pit working miners against "speculative miners" like himself - such as the foul air, long hours and low wages. The mouthpiece for this social layer was the Melbourne Age, which raged against "moon-faced opium-eating barbarians".

This was not simply political scapegoating. As the rulers of a remote and dispensable outpost of the British Empire, Australia's ruling class was always paranoid about the intentions of the French, the Russians, and later the Japanese in the Pacific. They sought the strongest possible ties with Britain to protect their strategic interests in the area.

Part of this was the desperate attempt by Australia's rulers to involve the British more deeply in the area - by various schemes to annex New Guinea, the New Hebrides, and Fiji to name a few.

Another part of this strategy consisted in strengthening what Henry Parkes called "the crimson thread of kinship" with Britain. Britain would be more likely to intervene to preserve Australia's interests, the thinking went, if Australia could be seen as "a new Britannia in another world".

Like other colonial settler states - such as the French colonists in Algeria, the whites in South Africa and Zimbabwe - Australia's ruling class developed racism in part to strengthen the ties of Empire. Genocidal policies against Indigenous people and a racist immigration policy were both expressions of this.

So Australian nationalism cannot be separated from racism. Small "l" liberals try to pretend that racism is only the extreme edge of chauvinism, but there's a direct connection. As with Aboriginal oppression, systematic discrimination against immigrants is integrated into the way the state and the economy work. So migrants tend to wind up in low paid jobs and so on.

Racist ideas benefit the capitalist system in two major ways. Firstly, racism divides workers - white against Aboriginal, Australian-born against immigrant, and Australian against overseas workers. But just as importantly, it provides employers with whole sections of the workforce who can be super exploited, increasing profits and creating a downward pressure on all wages and conditions, just as the oppression of women and sexism does.

So if the interests of capital are central to understanding racism in Australia, how do we explain the deep hold of racist ideas? After all, not every racist is a Hugh Morgan, profiting directly from the expropriation of Aboriginal land.

Of course, most corporate and government-controlled media propagate these ideas. And to justify its racist policies, the government constantly sends signals that Aboriginal people are to blame for their situation of powerlessness and dispossession, and that refugees are a threat to ordinary Australians.

But there is also the fact that racism has profoundly shaped our world. The places where we live and work have been shaped by centuries of oppression and division. In the 1850s, the practice of locating Chinese camps outside the boundaries of a town cemented a perception of them as outsiders. Similarly, Aboriginal people were restricted to missions or dilapidated camps for most of Australia's history. Today the internment of refugees in remote areas makes it easier to demonise them and scapegoat them.

Given its long and entrenched history, and the way it has been built into the structure of Australian capitalism, racism in Australia will not be challenged without a determined fight. A fundamental change to that structure is necessary in order to remove racism.

Understanding the roots of racism is essential in order to recognise where the solution lies.

The most powerful ally that the oppressed have in this fight is the working class which, unlike our rulers, does not benefit from the "divide and conquer" strategy of racism. But to unlock the power of the working class in this fight requires a political alternative to the acceptance of capitalism.

Thus the first real political challenge to racism in the working class came not from the Labor Party, but from the revolutionary Industrial Workers of the World in the early twentieth century. The IWW spat in the face of the vicious "White Australia" policy and urged their supporters: "Lay aside national prejudices, crush race hatred beneath your heel, join in true comradeship with the workers of all lands into One Great Union for, in the words of Karl Marx: ‘You have nothing to lose but your chains (economic poverty and servitude), and a World to Gain.'"