A House of Cards


A House of CardsPraise for A House of Cards

A useful analysis of capitalism and the economy

Review by Judy Kirby
the Friend (the independent Quaker magazine)
July 2008

This is a book to make your head spin. The demonic rise of capitalism in its global mantle is charted in thunderous tones and relentless recital of all the ghastly fallout from globalisation. It's hard not to agree wholeheartedly with the authors as they deconstruct the entire consumerist society to expose the capitalist engine at its centre. All our current woes stem from profit-motivated transnational corporate greed, which has been given full rein for the past thirty years and is now strangling the planet, from climatic degradation to debt-laden economic disaster.

Capitalism, which the authors point out has only 200 years on the clock, contains the seeds of its own destruction. In a telling observation quoted from Jeremy Rifkind, president of the Foundation on Economic Trends, this becomes apparent: 'If dramatic advances in productivity can replace more and more human labour, resulting in more workers being let go from the workforce, where will the consumer demand come from to buy all the potential new products and services? We are being forced to face up to an inherent contradiction at the heart of our market economy that has been present since the  very beginning, but is only now  becoming irreconcilable.'

After an impressive demolition job on the market economy, the  authors surprise us with their  solution. Yes, it's still revolution  comrades, with corporate  ownership of the means of production swept away but this time with a cannier alternative. Capitalism can be recycled like any household waste. We don't need to abandon the scientific revolution, the communications highway and sophisticated means of measuring demand. These need to be the tools of a new and vibrant co-operative movement based on the universally admired principles of the Rochdale pioneers. The authors are associated with the international organisation A World to Win, which is actively campaigning for a co-operatively owned and managed not-for-profit economy. It might all seem small beer to those of us overwhelmed by the scope and transitory nature of big business, but these authors have faith that co-ownership of companies can develop into a movement creating sustainable consumerism serviced by fulfilled employees. The book notes that the employee-owned John Lewis Partnership runs two of the nation's favourite shops Waitrose and John Lewis.

The present political system is too discredited to bring about change, say the authors, a view gaining ground. 'Governments and states have become voluntary warders patrolling the global economy on behalf of the corporations,' they believe. Instead they predict  a coming together of many  dissatisfied groups - consumerist,  climate change, anti-war and anti-  poverty campaigns linking in a  coalition to bring change.

But one has to glance at the  opposition before being carried  away with these heady ideas.  There are many proponents of  globalisation, in finance, business  and communications. Take Fareed Zakaria, the News-week columnist and editor, who thinks the globalised market economy has lifted many poor countries out of poverty. He is less interested in the decline of America than in what he calls 'the rise of the rest.' In a recent News-week article he proclaimed that the underlying reality across the world is one of enormous vitality. 'For the first time ever', he wrote, 'most countries around the world are practising sensible economics. Consider inflation. Over the past twenty years hyperinflation, a problem that used to bedevil large swathes of the world from Turkey to Brazil to Indonesia, has largely vanished, tamed by successful fiscal and monetary policies. The results are clear and stunning. The share of people living on $1 a day has plummeted from forty per cent in 1981 to eighteen percent in 2004 and is estimated to drop to twelve percent by 2015.'

But we may part company with Zakaria when we hear him count as success the fact that the tallest buildings, biggest dams and most advanced mobile phones will soon be coming from 'the rise of the rest' and not America.

Why we're getting a raw deal

Review by Andrew Fisher
Labour Briefing
February 2008

A House of Cards looks at the global financial system. It is part of the A World to Win series of books, following last year's Running a Temperature on climate change. It was conveniently published around the time that Northern Rock was receiving its second tranche of government aid (which has now seen the equivalent of two thirds of the annual NHS budget being transferred to the private sector).

The book collates a range of staggering examples of both the rapacious and precarious character of the current stage of capitalism which support its Marxist analysis that capitalism cannot be reformed but must be replaced. As the Chief Economist of Morgan Stanley said, there is, "a powerful asymmetry in the impacts of globalisation ... namely, record highs in the returns accruing to capital and record lows in the rewards going to labour."

In particular A House of Cards focuses on what Marx called "fictitious capital", which in the 21st century manifests itself as debt bundles, securities and derivatives - all traded on the world's markets and with a value four times that of global GDP (in 1980 the world's financial assets were worth just 108% of global GDP). The virtual world of global finance bears little resemblance to the world outside, where in the UK personal debt has soared from 105% of annual national income to 164% in 2006. According to the Citizens Advice Bureau, 1.7 million people in the UK sought debt counselling last year.

Of course if the "fictitious capital" of the global finance world was purely fictitious this would not matter, but like most fiction it has its basis in reality - and when the reality of the US sub-prime lending crisis hit, the real value of those debt bundles exposed the fiction.

As in other titles in the A World to Win series, this book ends by considering positive alternatives - rejecting inherently doomed reformist measures and considering the positive role co-operative organisation could play. Of course the struggle is how to get there, but no one could expect an 80 page book to solve that one.

Paying the price of capitalism

Review by Charley Allan
Morning Star
Sunday 23 December 2007

THIS timely and topical look at global capitalism's collapse comes from the people behind the World to Win movement, a grass-roots theoretical and direct action network that was launched in 2005 on the back of the book of the same name.

A House of Cards describes the precarious state of the world's financial institutions, explaining how the Northern Rock crisis is just the tip of the iceburg.

For example, the writers point out that, in 2007, Britain's personal debt exceeded its GDP for the first time. Not a good sign.

The chapter on "paying the price" dramatically covers the costs of corporate-driven globalisation, including environmental degradation, a widening rich-poor divide, extreme consumerism and increasingly authoritarian rule.

After warning that attempts to tinker with the edges of the system are doomed to failure, the book shifts into a kind of manifesto for a better world based around solidarity and co-operation.

No arguments about that, but it's a little less clear on how we're going to bring about this utopian vision.

Still, it's hard to disagree with anything in here and it would make a great gift for someone who's just starting out on a revolutionary path, even if they don't know it yet.