“If we have no
business with the construction of the future or with organizing it for
all time, there can still be no doubt about the task confronting us at
present: the ruthless criticism of the existing order, ruthless in that
it will shrink neither from its own discoveries, nor from conflict with
the powers that be.” — Karl Marx
New! June 2009
What the World Economic Crisis Teaches about Capitalism
Against the hopes and concerns for the speedy recovery of “our” economy
Ever since the financial markets began collapsing and the real economy shrinking at a hitherto unknown pace, capitalism becomes a topic of discussion. Unfortunately, in quite a wrong way. People and elite answer the diagnosis that “capitalism doesn’t function any more” with the strong desire that it should immediately function again.
The government uses its political power over money and debts to rescue the banks with trillions and to protect car-manufacturers and other industries from destruction by stimulus packages and other subsidies. All this is done – and nobody makes a secret about this – so that capitalist profit-making gets going again and continues as before.
The unions and their members identify all the more with their employers the more the survival strategies of the latter turn out to be ever more incompatible with the interests of the workforce in wages and livelihoods. The organized workforce does not respond to layoffs, part time work, and wage-cuts with resistance against the capitalists, nor do they reject the state that wants to rope them in for the rescue of capitalism; they demonstrate side by side with their exploiters and demand more money from the state for the owners of their workplaces: “Save our jobs!” The state is called on to replace the profits of capital so that workers can continue working!
The left complains the loudest about the greediness of the banks and the speculative profit maximization they have allowed themselves. They ask the state to rescue these same profiteers but only so that they can again perform their social service for jobs and exploitation by providing credit to the real economy. Banks, according to the left, must be better controlled than up to now so that their casino-capitalism never again gets the opportunity to harm the real, productive capitalism.
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Moved by the worry that capitalism no longer functions as the basis of life in the country and for its working masses, and yearning that it might function again, people once again pay no attention to the question: what kind of an economy actually functions here? – even and especially in a crisis.
What kind of economy is this, if work is cut back or stopped and poverty grows because speculation in the billions by the big money houses goes bad?
What does it say about the country if nothing within it is so “relevant to the system” as the banks? If the government's entire power over money is brought into play and risked in order to spare foreclosure on unsustainable credit constructions?
What kind of an world economy is this, if the status of nations is decided by whether they can muster the power to maintain this swindle – or else not. All the states rescue – as best as they can – their national wealth and their economic capabilities together with their banks. They know that crises are the times of major economic and political shifts in power. Some see the chances that the crisis offers: chances for a revision of the global balances of power, others fear them. And they all do everything so that “we” will recover, so that “America will emerge stronger than before” (Obama). This is what the capitalistic jobs of the future depends on. A people that wants to live without being discouraged from capitalism – and actually lives for it – will even have to answer for a victory in global crisis competition with the due sacrifices.
The answers to these questions clarify why this mode of production deserves to be abolished – instead of being made to function again. Never does the rule of capital reveal its absurdity so openly as in a crisis in which capital accumulation – because it fails – strangles the material life process of society.
Recent Additions
(June 2009)
“Bad Bank”
A lot of money to rescue the banks and a free bonus lesson on the madness of capitalism
(May 2009)
World Market and World Power: Part I
On globalized civil society and its anti-terrorist culture of war
It is part of the basic stock of left social criticism that the violent foreign policies of modern states have “something to do” with their internal capitalist economic system. But when it comes to explaining and substantiating this connection, many are content with short cuts. One tries to identify economic interests for war, denounces “war for oil” or other mineral resources, and is able to imagine that a government goes to war because the military-industrial complex wants to sell weapons. One sees the acting government as a non-sovereign marionette of some private business interest, such as former US President Bush as the extended arm of the oil companies or Halliburton. This ignores that in opposition to these private capital interests there are also plenty of others who see their business relations ruined by war and who contend that their profits would be better off in peace. It does not grasp the national interest of the capitalistic community in the domination and subordination of other states, which hurts as well as commissions private interests for the greater cause. The short-cut method fails more than ever where – for example, in Afghanistan, the Horn of Africa and off the Lebanese coast – one finds nothing which would support it. So left critics then make it easy it for themselves by falling back more or less openly on the properly deprecated views of bourgeois political science and simply collect “factors of international conflict.” On the one hand, they know about the “economic interests” of states in dealing with each other; however, they hold them to be in principle capable of consensus and compromise. On the other hand, they know a “power ambition of states” which, because they do not explain it, is transfigured into a political constant deeply rooted in human nature, which no longer has anything to do with capitalism.
This article attempts for once to fundamentally address the connection. The economic dealings between capitalist states in the globalized world economy and their competition over the modern “wealth of nations” are explained, from the purchase of raw materials, the sales of industrial products, the competition of national sites as capital locations, to the international competition over the quality of the national currency. In their “security policies,” the nations with globally active businesses reveal how little they leave to an automatic working of the necessities of globalization and to their proverbs about the mutual benefits of trade. In the middle of peacetime, they execute, beside the economic, a second, strategic competition as powers, using the threat of war in order to enforce a peace useful to them or to be able to rectify it in accord with their goals. The perfect world market is based on a comprehensive and permanent deterrence regime by a few great powers against the rest of the world of states. Only the destruction of all alternatives and the punishment of all experiments produces for all states the lack of alternatives and hence the objective constraint that characterizes the modern global economy.
The crisis: a lesson
The financial crisis that began in the autumn of 2008 has hit the “real economy,” the sector dealing with the production and trade of goods and services. Despite reassurances from politicians and captains of industry that “our economic fundamentals are sound,” they proclaim this the “biggest crisis since the Great Depression,” much worse than the various “recessions” of the postwar economy.
So it goes once again. Instead of growing, the economy shrinks. So what? Do more and more things and services really always have to be produced and sold? A naive question, it seems, which is definitively answered by the economic news: all the major banks, insurance companies, car companies, communications companies, chip manufacturers, etc etc, all now layoff significant numbers of people. Year after year and month after month, these employees are permitted to earn the incomes needed to cover their living expenses only if their work expands an ever-growing business and increases the property at the disposal of their employers. Evidently, people earn their incomes by making their employers ever richer while at the same time making themselves poor, remaining dependent on jobs and wages. They are paid to service the accumulation of capital – and if they don't do this, they can kiss their income goodbye. That's why, in this economic system, it's a disaster if everything just continues like before: if the same amount of work is done, if the same amount of food, housing, cars and computers are produced and consumed as in the previous period – thus people become not poorer and not richer – this will not do in an economy in which production is not for need, but for the enrichment of those who own capital. If “it” just continues like before, nothing continues – and certainly nothing continues if “the economy” is shrinking.
And why is it, if all the economic subjects have an interest in economic growth or depend on it as their daily bread, and everyone wants growth and is committed to it – why then does it fail to continue? What kind of an economic system is this, in which its agents achieve the opposite of what they are trying to achieve? The entrepreneurs who organize growth do everything right in the business sense: they require more and more work effort from their employees, have more and more goods produced and throw them on the market. But suddenly they can no longer sell their produced commodities or sell them at a profitable price. The purchasing power of society is not enough to turn all these commodities into money. The employers themselves are the ones who have produced this barrier to the ability to sell, because every commodity they produce is a demand for profit. When it comes to producing the mountain of commodities that they want to sell, they recognize no barrier and produce as if society could buy without limit. But when it comes to putting purchasing power in the hands of their suppliers and workers, they are very stingy. Because production takes place for profit, ie for the goal of maximizing the difference between costs and proceeds, the production of commodities to be sold is disengaged from the creation of the purchasing power which is needed to turn them into money. Crisis arises because too much capital was created and invested, the productive forces were too developed and too many commodities were produced to be useful for their purpose: to be profitably sold.
So one is faced with the absurdity that in this society hardships and poverty are not due to a lack of production, such as a natural disaster or war, but because of an abundance of material wealth. Nothing is lacking! Factories are idle, raw materials are not processed, people who are dependent on wages or salaries in order to be able to live stand in the street. All the elements of material wealth are left unused and devalued because and as long as they are not suitable for the sole purpose for which they exist in this economy: profit making. In this phase of the industrial cycle, profit shows point blank that it is an obstacle to production for needs.
If society is blackmailed long enough by the paralysis of its reproduction, if prices for machinery and raw materials go down and the unemployed offer themselves for cheaper, and the point is reached that the investment of capital is again worthwhile – and then the whole circus, the absurd cycle of accumulation and over-accumulation, both set in motion and brought to a standstill by credit, may start all over again.
In any event, as long as workers let themselves be blackmailed by their dependence on capital.
ruthless_criticism@yahoo.com