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The capitalist leopard cannot change its spots

The dreaded “C” word is making its reappearance as commentators and economists alike openly question whether it’s capitalism as a system that’s in the mire rather than merely the banks or the euro.

When even the BBC is asking pundits whether “Western capitalism” has failed the day after large-scale falls on share markets, you know something is up.

And when Will Hutton, the former editor of The Observer and well-known reformer, says that “the way capitalism has been conceived and practised for the last 30 years has hit the buffers”, things must be really bad.

Others who earn their living directly from the system, like economist George Magnus who is senior adviser to highly-troubled Swiss investment bank UBS, are more explicit, writing recently:

It is a crisis of capitalism because our economic model and policy settings cannot produce sustainable growth, adequate income formation or employment creation. We have lost the housing, financial services and credit creation growth drivers and been left with excessive levels of personal and government debt to unwind, a dysfunctional financial system, and weak labour markets.

The capacity to produce and sell goods and services has outstripped that of consumers to borrow and spend. Without credit and jobs, other fault lines have been exposed, including the long stagnation of real wages and extremes of inequality. It is truly a crisis of aggregate demand.

While the acknowledgement that there is something fundamentally wrong with the present system of production and exchange, aka capitalism, is welcome, that’s as far it goes. Magnus, like Hutton, believes that the system can be reformed through intervention. Hutton advocates what he calls “good capitalism” brought into being by the actions of “democratic government” with the alternative being the “worst economic contraction for a century”.

A leopard cannot change its spots, however. And nor can capitalism. The globalisation process that accelerated following the breakdown of what now seems to Hutton and company a more reasonable, post-war capitalism cannot be put into reverse. Not by governments, not by the European Central Bank or the International Monetary Fund or the World Bank. And certainly not by Cameron, Obama, Merkel, Sarkozy et al.

Inherent contradictions of capitalism drove the transition from a managed economy to transnational corporations more powerful than national states and a global financial system to fund the expansion that accompanied huge increases in productivity.

The driving down of wages as a share of national income is well documented as capital expanded, moving production to cheaper labour areas, undermining local trade union bargaining power. So too is the fact that capitalism in the developed countries was no longer able to provide full employment as the technological revolution kicked in.

Yet the goods produced had to be sold to realise the profit they contained. And if workers couldn’t buy them out of earnings and savings, why endless credit would do the trick. And so it came to pass that the world was flooded with credit and debt, and that endless growth was here to stay (no matter if it destroyed the planet in the process).

Governments deregulated everything that moved and privatised what they could. The financial system went into an orbit where money seemed to create even more money.

No longer did we live under capitalism, New Labour told us. A paradigm shift had occurred.

Well, yes it had. But it was not the pain-free paradise that everyone was promised. Behind the spending frenzy was the slow-burn of the explosion of the very system of production and finance that New Labour and others had Merlin-like magicked out of existence.

There is no mystery about the solution. A system of production that is driven by co-operation has to replace the profit drive. The means of production already exist that can satisfy most human needs. Their ownership and control is simply in the wrong, shareholding hands.

The political class, experts and assorted advisors have no answers, not least because the crisis has spun out of control, driven by a self-generated momentum. Social, revolutionary change to put capitalism out of business is down to us.

Paul Feldman
Communications editor
23 September 2011

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Jonathan says:

Britain’s Newsnight and the confusions of Empiricism when the surface breaks out in boils and lesions.

A week ago in a discussion on the same Newsnight, which was not controlled by the Newsnight team, three financial experts (I will accept that from their grasp of the issues) spoke of the decays in Greece imposed by the austerity measure reflected so far; how these would spread across Europe; and as a closing remark, almost as an accepted conclusion with no great comment: within ten years war – by implication across Europe. I tend to think they ran out of time: Europe! – only thing to be sure of is it won't reach Mars. They have had a week to revise their assessment: what a week!

The above delivers in spades: but we have a new reality unfolding that needs a sharp turn to developing method – scientific certainty without fear of error. We will all sharpen it further in critique – and practice. To do so needs more than a virtual world.

To some extent matters stand as equals: their hysteria is to make way, or to call upon new theoreticians or demagogues to deal with their crisis, or our crisis of their making, ours is to organise quite distinct – walled off from 'alien forces'. Of course of 'their making' is to concede that capitalism is a system of crisis – it is one of its driving forces, it is what lies behind each new invention throwing competitors into panic-mode and driving forward the extraction methods of surplus labour. It is what lies inside the usual overproductions.

The equivalent is that for the working class. The imposition onto the back of its own communities drives forward from the new generation activists with a sharp edge and the need to conquer theory 'on the hoof'. These communities, a product of the relative dormitory conditions that created this modern vast division of town and country, are fitted as to the vast overproduction of that particular product – people. – We have a history of struggle, a history of heroic sacrifices even from other layers to apply themselves to theory for the sake of the working classes and in some cases to years and years in prisons for this commitment: I think of Blanque. The Paris Commune did not ask for that struggle, it was not romantic it called forth much sacrifice and latter when the dead had buried the dead much analyse. The city had not crystallised into its more natural state of capitalist appendage due to certain backwardnesses of that capitalism – now it is that a constant state of decay is the chosen imposition of those that control production. Whatever: it is no longer just a breeding ground to be tapped: it is a monstrous outpouring of youth ready and able to organise – only put to them the goal. As in the whole world with mega cities.

'more reasonable, post-war capitalism '. What Hutton my wish for was based upon the exploitation of the third world: none of his equations work with the growth of the BRIC countries and the sudden resistance as Global Capital spread in north Africa, especially Egypt and beyond. The coming together of the political revolutions in north Africa and near east: especially the turmoil of the whole of old Palestine and with this the economic crisis is a real philosophical coinciding. The source is identical. What occurred in the West with the acquiescence of well rewarded political elite (no accident that in Britain the most significant friends of Global Capital and the reforms necessary to unleash its credit boom have ended up multi-millionaires) was copied by GC across 'its' globe: the sycophantic social democrats (along with their ilk and the Stalinist across Europe) snuck in slowly and swung their influence, or reflected analysis, as GC formed its base.

The spread to the rest of the world without its history of social democratic parliamentary skills, connections with union bureaucracy and media connection met resistance on all sides, not least at the attempt by their elites to equal the skimming of their western friends. The actual identity between the economic access of the vaunted 'democracies' and the rest is one of accountants, of pure legal fictions – below that surface the real differences is that of how deep the roots go, how far the legal fictions – bourgeois law gives cover. Even the human rights record of the murderous British régime could teach the rest of the world a lesson or two, not least into how to carry it out while brand Britain shines as if nothing to hide. So too its 'tin pot dictatorial' controls, its palaces – its intimate connections at all levels with the boardrooms – its vast access to wealth. As Britain so too France, Italy, and beyond: the US is a special case – in that all that has so much skill in place that the PR industry; lobbyists ; media front: all, have a turnover greater than some small countries – and the media front which enters hearth and home is mostly run on the basis of the first two. It is not that the US population is the most gullible it is that they are the most bombarded, manipulated and betrayed ever in history – and like the British workers stuck in the liberal party in the 19th century they are stuck in the Democratic – who is tied hands and soul to wall street and GC.

Global Capitalism was also an opportunist move to blackmail National Capitalisms to escape (temporarily – and the bookkeepers must have known it) the inherent decay in the system as noted above. The post war strengths of the world-working-class, regardless of the crisis of leadership, made it impossible to solve this by another great conflagration. Wearing down the Soviet Union was, even by the figures supplied by the CIA to the Whitehouse, something that would take a generation: the strength of its workers proved by the Red Army. Two factors in the American War (i.e. the Vietnam as the US centrality has it) the near unbelievable resistance, even after a war against the French, of the whole people of Vietnam – but also the burgeoning resistance 'at home'. This tapped cultural centres that so confused the ruling elites of capitalism that they were swamped – which expressed the heart of the matter – conscripts would resist to the fragging end the push to total war.

Even electrons don't seem to be behaving: even electrons behave as to the central thesis of dialectical materialism; the only absolute is that there are no absolutes i.e. everything is relative. As is universally admitted tonight even unto the mirror 'their world view has been shattered', one problem is though they have to 'reflect' and look in the mirror – it is shattered; the world view is indeed shattered– all round. They can not distinguish between the looking and the mirror. In fact the most important 'thing' that is shattered, on top of 'reflection itself' – is the surface presentation. For this leads to 'peaking' below that surface to 'what lies within', and the speed of movement leaves them reeling – as must the showing of itself in the movement of reality. Where the research leads is not the point. That central thesis is where grasping moving reality begins – that light is never a constant and that profits do not rise constantly is not allowed as discussion without total confusion – relatively speaking that is. An interesting pair of equations – which needs real mathematicians for a comparative analysis. Einstein took an 'equatable time' to look into his than Marx did his. I could wax very lyrical on all this; a rich seam. But turned to prose Marx reduces to; the tendency of the rate of profit to fall, and; the impoverishment of the working class. Both of these are expressed by Paul. However, that impoverishment is not in spirit. I much miss the mathematicians that can popularise these matters – the need to be co-opted and conscripted to not only dig deeper – but to cartoonize this as a cudgel. Essence both is: and is undergoing constant change.

Even on the most common day to day issue their news outlets portray absurdities: two jobs going ten people 'chasing' them: they interview with the certainty this or that individual may get it (well it gets filled: job done – proof positive) – not that the eight will not. Constant optimism (hope – lies forlorn springs to mind this last 10 days, for their 'presenters' sound more and more hollow) – within their capitalist property relations i.e. where the person is selling a commodity of which 80% of the unemployed is overproduction and surplus and disposable – i.e. present potential labour power, as to future labour power – it may (and lets not start as to 'freedom of choice' – 'Educating Essex') educate itself or become a dying breed. .A race where someone always wins; lucky souls: and thereby proving the innate success of the system. But as to the 99.99999999r % eaten into at a steady rate regarding wealth of the planet: now 10% now 11% now 13% now rising in the opposite direction as to purpose – as with the circulation of souls: this 'biodegradable' takes time to break down – unless! This surplus, usually a reserve – suddenly can't be thought of by the masters of the universe as putting to the plough now the world view is shattered – 'in any foreseeable future'. They are even now holding to 'a cycle' growth will return as to pension funds. China!: its tiger will go the way of Ireland – Celtic verses Sino skinned rare breed.

It is the 'dream' the American dream – not the failure to reach a very small top by 98%. World wide the disappearing moment would make one wonder as to the rare breed hiding on its yachts or in certain shire areas or gated pillage – that disappearing moment or more of the population – through history i.e. that it continually centralises in those fewer and fewer hands: but the interviews with the 'success' and not the failure to continue the deceit central to avoiding revolt: REVOLT!

Getting to the .Essence of the matter' as long as all is going well is an automatic event; they identify the appearance for the essence (and so too does society in general ) or where 'it' supplies to consciousness reality in such a way as to give the impression they – the holders of consciousness - reached that first, i.e. before reality! Post hoc ergo propter hoc, (after this therefore because of this) becomes twisted: as they live in the moment where appearance is everything; then it has no history–and they go forward not 'aware' it is so. If the Romans could grasp it and this lot learnt classics one would think it an easy matter – reflection: and reflection without motion betrays nothing, exposes no laws. More significantly the causes make them panic as they can not, and with good reason, penetrate what 'it' may be, indeed where the hell they came from!– for in the world of appearance with no motion there is also no causes. They live quite happily in this world of flesh and shadows [i.e. the complete separation of being and of thinking]– of executing their role in capitalist society – fragmenting - while holding an idealist outlook – until a crisis of the magnitude that shakes it to the core and wakes the masses- then they panic. And again we see panic. The reason is not hard to fathom as the actual work of production and reproduction of society as a whole; its total reproduction of which it is a part is carried out by necessity by the working classes (including all the supporting moments – of which these 'masters of industry' are nothing but an impediment) in practice. And that is the proof of truth. In the moment time does not exist: Mirror mirror on the wall. In their revolutionary heyday when reorganising society and accumulating capital and putting it to work; that was a revolutionary act – where the sweeping away of feudal fetters needed an act of will: then they entered organization and practice – and very well. The time has passed. Whether Empiricism or its marketable theme pragmatism – they know it has failed them. So from the lie as to growth and jobs comes a lot of squirming: and behind the scenes plans. And as the sudden media blitz against 'Travellers' criminality' shows they will search high and low for scapegoats as a glue to rally the unwary behind – and the bribes of ' good' pay. The CIA placing someone at the top of Al Jazeera in place of killing their journalists served them well for a while. The media is a tight warfare unit: shadows.

A reading of Leon Trotsky Germany:The Only Road 7. The Class Struggle in the Light of the Economic Cycle as the above, too, demonstrates the necessity of a sharp analyse of the developing economic cycles – now reached a nadir – with the class struggle and the crises of capitalism; and must overcome all spontaneity. Even before the leap of the last 10 days what is described above shows that what happened in Germany – as elsewhere across the capitalist world - during the thirties is now a world wide issue. Then, after the betrayals of Stalinism and the drive to world war alone allowed capitalism to re-establish itself latter – after that is world wide deaths and destruction. One ought to take care in assuming that level of destruction which allowed the extension of the unnatural life of capitalism has a corollary now. It is an 'interesting' period to try to characterise in a few words – but the then Social Democrats were allowed to avoid the historical death knell precisely because in the Soviet Union made an astounding turn in the Bureaucracies foreign policy adjusting to internal contradictions and therefore its attitude to precisely Fronts. This coinciding with the outright purging, creating a new executioner, of all internal opposition (and this analysis of Trotsky's proceeds that by only months). And that Front is a political cooperation qualitative short of united organisation or action. Stalinism betrayed the proletariat – in the name of Marxism - opposing any pact with 'social fascists'. Social democrats as a new type of front, motivator, and apologist for capitalism have nothing to hide behind. The more tight historical lessons comes from Spain where each had an opportunity to apply their program to some extent or other – and again Stalinism basing itself on the bureaucracy became the executioner. It is obvious that the banner of Marxism is raised unequivocally – and just as clear that the then Stalinist flew the same banner: but that the Assemblies are not a Marxist front must be driven home. The tightest of all analysis is as as above of living reality. All the struggles of the 30's showed precisely that the unity in difference was an essential precondition not just of defence but of the rallying and organisation against capitalist decay and toward: Social, revolutionary change to put capitalism out of business . .

Other than the organisation into Assemblies and the 'conscription' of those to delegate for essential works to drag in all that belong by nature walled in an Assembly– one of the greatest tasks is best expressed through the total extension of it as opposites. How to run a global planned economy for the supply of world needs and simultaneously to stimulate the greatest diversity of thought: there is no free thought without the expansion of consciousness and the overcoming of specialisation.

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