Political and economic crisis

Louis Proyect lnp3 at panix.com
Mon Nov 30 10:47:22 PST 1998


In the "Last Intellectual" Russell Jacoby describes how the process of co-opting 60s radicals into academia has produced a highly fragmented, "specialist" subculture that is the opposite of the sort of integrated world-view held by Marx and Engels themselves.

Academic radicals in political science departments can explain the results of the last election results which repudiated Gingrich in minute terms, but might be at a loss to explain the economic situation that produced these results. Radical economists, by the same token, can tell you all about the significance of the return to "normalcy" on Wall Street, but may not have the slightest inkling why Jesse Ventura got elected.

In theory radicals outside the academy should be free to develop a more integrated world-view. Unfortunately many of them belong to "vanguard" parties and present an analysis that is geared as much to satisfy a central committee as journal submissions are meant to satisfy department heads. Free thought gets short shrift across the board. The biggest failing of the left would seem to be its inability to provide an explanation for the current economic crisis and how to resolve it.

Lately I have been refining my own thinking on these questions, which has been shaped to a considerable degree by Harry Shutt's "The Trouble with Capitalism." Shutt places the current economic crisis in the context of growing contradictions brought on by the winding down of the post-WWII boom. As good as his analysis is--and it is good--where it falls short is in its consideration of working-class struggle. There is probably nothing that can explain capitalism's ups and downs than this factor, which has equal significance to Kondratiev waves or the falling rate of profit.

As a starting-point for understanding the relationship between economic and political crisis, I would suggest the following time-line:

1) MID 1850S TO 1914: PERIOD OF EXPLOSIVE CAPITALIST GROWTH AND EVENTUAL DEVELOPMENT OF IMPERIALISM.

Communism of the First International develops as a response to the first phase and Second International opportunism as a response to the second. Inability to provide a revolutionary solution to prevent WWI allows capitalist system to resolve growing contradictions through destruction of excess capital. Rosa Luxemberg was one of the few Marxists who could explain why social democracy had gone wrong. As she states in her Junius Pamphlet:

"Reduced to its historically objective essence, today's world war is entirely a competitive struggle amongst fully mature capitalisms for world domination, for the exploitation of the remaining zones of the world not yet capitalistic... The high degree of economic development in the capitalist world is expressed in the extraordinarily advanced technology, that is, in the destructive power of the weaponry which approaches the same level in all the warring nations. The international organization of the murder industry is reflected now in the military balance, the scales of which always right themselves after partial decisions and momentary changes; a general decision is always and again pushed into the future. The indecisiveness of military results leads to ever new reserves from the population masses of warring and hitherto neutral nations being sent into fire. The war finds abundant material to feed imperialist appetites and contradictions, creates its own supplies of these, and spreads like wildfire. But the mightier the masses and the more numerous the nations dragged into the war on all sides, the more drawn out its existence will be."

2) 1917 TO 1945: COMMUNISM, FASCISM, AND THE GREAT DEPRESSION

Failure of socialist movement to prevent WWI leads contradictorily to socialist victory in Russia since the war has radicalized a section of the Second International. This victory is a significant factor in post WWI politics as fears of Bolshevik Revolution lead ruling classes of Germany, Spain and Italy to opt for fascist solution. Failure once again of the socialist movement to defeat counter-revolution leads to a new outbreak of war.

Both Keynsianism and fascism represent capitalist attempts to use the power of the state to resolve systemic contradictions. Both appropriate superficial aspects of the Soviet system, while leaving underlying property relations untouched. In either case, the only state-sponsored "reform" that can deliver the goods is militarism and war. Hitler's march into Eastern Europe and the Japan-US conflict over control over Pacific resources represent the cutting edge of the New Deal and fascist "revolutions".

3) 1945 to 1970: POST-WWII PROSPERITY, DECLINE OF SOCIALIST AND COMMUNIST PARTIES

This period has the same disorienting effect as the pre-WWI period. Various theoretical attempts are made to demonstrate the permanence of capitalism, from the Frankfurt School to Eurocommunism. These ideological concessions are mirrored in decline of labor militancy. "Class peace" formulae abound in the American and European labor movement. This in turn allows capitalism to rationalize production and maximize profits. Coal miners, once the most militant sector of the US labor movement, sign deals with the coal bosses that allow the workforce to be gutted. Protests are short-lived because union bureaucracy fails to take the assault seriously, while the remaining workforce remains mollified by the high wage social compact.

4) 1975 TO PRESENT. EMERGENCE OF POST-COMMUNIST LEFT AND WINDING DOWN OF POST-WWII ACCUMULATION CYCLE

CP's lose whatever revolutionary appeal they once had and a revolutionary movement of Maoist, Trotskyist and anarchist leanings develops internationally. It has all of the same flaws as the "left Communists" in the earl 1920s and consequently fails to have an impact on the labor movement. For an entire 20 year period, except in rare instances like the Teamsters union, the trade union movement continues to decline while most conscious Marxists adhere to a methodology which virtually ensures failure. The union bureaucracy, lacking any serious threat from the left, continues to placate the bosses. In NYC, a virtual laboratory for trade union opportunism, DC 37 sells out its workers while endorsing a Republican mayor who kept a concentration camp slogan in his campaign headquarters: "Arbeit mach freiheit". Stanley Hill, handpicked successor of DC37's "socialist" Victor Gotbaum, has just resigned and will probably face criminal charges soon.

Now that the accumulation cycle has crashed against the wall, the capitalist class is worried. Yesterday the NY Times reviewed George Soros's. "The Crisis of Global Capitalism." Soros is quoted as saying, "Eventually the markets should go much lower, leading to a global recession, The disintegration of the global capitalist system will prevent a recovery, turning the recession into a depression." The Times has a good time poking fun at Soros's "catastrophism" while the stock market seems to have corrected itself. What neither the Times nor Soros seem to have a full grasp of is the underlying economic and political crisis. To understand the political crisis requires much more than Soros can deliver. It is one thing to call for capital controls, it is another thing to call for capital overthrow.

What none of the bourgeois ideologues seem to understand is that the stock market collapse is related to much more systemic problems that will not be resolved by capital controls. (Speaking of capital controls, the latest New Left Review--which should be rechristened the Near Left Review, there is an article that makes a big to-do about the need for a new Bretton Woods. It is as if the conclusions of Brenner's article were too much to handle and they are taking a tranquilizer.)

The main features of the current economic/political crisis are::

1) Failure of capitalism to provide a development path for the third world. The depression in East Asia has destroyed the ideological underpinnings for opportunism. It is no longer possible for Mandela, Lula, the FSLN or any other quasi-revolutionary parties of the 1980's generation to make the case that capitalism can solve the needs of the people.

2) Continuing implosion of the former Soviet Union. This has implications that run as deep as the Weimar Republic crisis of the 1920's. The Communist Party is for all sorts of solutions, short of Communism, while the bourgeois parties will do everything they can to maintain capitalism. However, capitalism in Russia is literally killing the people. Desperate situations do not necessarily lead to socialism. Tens of thousands of nuclear weapons spread across the former Soviet Union against a backdrop of possible civil war and ethnic fratricide threaten the future of the human race.

3) China descends into capitalism and becomes host to the same set of contradictions plaguing the former Soviet Union.

4) Ecological crisis. Global warming heightens likelihood of catastrophic flooding. 10,000 people died last month in as Hurricane Mitch devastated Central America in the worst hurricane season in 200 years. 10,000 deaths in a population base the size of Nicaragua and Honduras is proportional to about 1/2 million deaths in the United States. All that to satisfy Jim Heartfield's hunger for Burger Kings.

5) Impoverishment in the Third World. The UN Human Development Index for 1998 states that the GDP per capita in industrial countries is $16,337 while it is $1,008 in least developed countries. The human side of this difference is a life expectancy index of 0.8195 in the former and 0.436 in the latter. Put in human terms, these figures mean that you can expect to live twice as long in someplace like Canada than in Nigeria. Since the two countries are roughly equal in natural resource endowments, this adds up to a powerful class struggle dynamic as indicated by recent reports in the NY Times about occupations of refineries in Nigeria by impoverished youth.

The thing that both Mark Jones and I find dismaying is the general lack of the Marxist left to come up with a response that is appropriate to the crisis. It seems that George Soros is more alarmed than most leftists. To a degree this is because, as the Times points out, he is worried about financial exposure in risky markets. On the other hand, Soros is a real intellectual who has attempted to come up an integrated world-view that defends the long-term interests of the bourgeoisie. It should be our challenge to do the same thing for the working-class.

Louis Proyect

(http://www.panix.com/~lnp3/marxism.html)



More information about the lbo-talk mailing list