> Crunch time for US capitalism?
> December 04, 2004
> By Patrick Bond
> To start with diagnoses of the situation, four critical schools of
> thoughtare worth citing because they have somewhat different - and
> oftencompeting - ideas about what ails US and global capitalism:
>
> 1) Overly competitive corporations, which drive down the rate of
> profit;
It is not clear how "overly competitive corporations" drive down the _long term_ rate of profit? What's role of mergers, amalgamations and closures in overcoming competition?
2) Overconfidence within financial markets, which today act
> more like a
> casino than savings/investment mechanism;
Financial markets don't create surplus value. IMHO,the crisis theory must be grounded in the reproduction cycles of productive capital.
>3) Overproduction of
> commodities, as a persistent reflection of inadequate consumer buying
> power;
Capitalism can create its own consumer power, if the profitability can be sustained.
>and 4) Overaccumulation of capital more generally, a
> problem which
> cannot be displaced forever, but which one day must face more severe
> devaluation.
Destruction of capital is a mechanism to restore the rate of profit and lay the basis for the revival of capitalism.
> Opposed to these is a Marxist position which respects the strength,
> resourcefulness and self-healing capacity within capitalism - and
> especially reflects upon the weakness of the system"s main enemy: the
> working class.
It's difficult to find "the working class" nowadays. There are workers, billions of them, all over the world, but where do you find this mythical working class?
> Some of these latter accounts stress a fifth school of Marxist theory:
> class struggle as determinant. And it is true, the world's working
> classand nearly all counterhegemonic national struggles have suffered
> persistent, debilitating defeats over the past three decades,
Why have there been "persistent, debilitating defeats" over past three decades?
> Yet the internal contradictions continue bubbling up.
> Globalization has
> generated economic stagnation, not dynamism. According to even the
> WorldBank, the increase in the world"s annual GDP per person fell
> from 3.6%
> during the 1960s, to 2.1% during the 1970s, to 1.3% during the
> 1980s to
> 1.1% during the 1990s and 1% during the early 2000s.
Decline in the per capita GDP can hardly provide an explanation for the economic crisis, whether actual or potential.
> On the other hand, corporate interest payments remained at record high
> levels throughout the 1980s-90s. Subtracting interest expenses, we
> get a
> better sense of net revenue available to the firm for future
> investmentand accumulation, which indeed remained far lower from
> the early 1980s-
> present, than during earlier periods, according to French >Marxists
Isn't the Profit After Tax calculated after subtracting interest expenses?
> These included the Third World debt crisis (early 1980s for commercial
> lenders, but still going on for most of the world's states and
> societies);
China and India don't face any crisis of external debt. That's 35% or more of the world's population.
Ulhas