Capitalism

[ItWillNeverWork]

That's a political problem for anyone seeking to change things substantially. It's not a problem for the marxist economic model - it's a confirmation. (And come on, that's what you really meant isn't it?)

Yes, It is a problem for all people wanting to change things, but more so for marxists because marxism proposes such drastic changes. I wasn't attempting to criticise the marxist model per se, just stating that there is next to zero possibility of marxism ever being adopted.

Saying this, I think there are better ways to make the economy function than to simply replace it with a different system.

 

[Steve Booth]

The ship of Theseus

So is it in the death throes or what?

Was capitalism ever alive in the first place?

This may seem a silly question but I am trying to make a serious point with it. Capitalism changes and develops in response to new situations. So this present crisis will pass and perhaps the old model of 'capitalism' will go. But there will be a new model to put into its place.

And I think the other side of the crisis will go one of two ways:

(1) The relatively benign option. Towards new technologies, like the internet, fibreoptic broadband or whatever the new technology thing is going to be, that we don't yet know about. (Like the invention of printing, the industrial revolution, the shift into electonics etc)

(2) The nasty option. An intensification of the War Against Terror. (model this one on the effectively Keynsian intervention in the economies in the run up and during WW2.)

 

[ItWillNeverWork]

Why only one of two ways? It could go both ways. Also, new technology or war will not sove the underlying problem with the current form of capitalism.

Undoubtedly Capitalism will evolve into something different and at the moment it seems as if it will be charactorised by a state ran financial sector alongside a free market in other industries.

Thats just me speculating though.

 

[davgraham]

Yes, It is a problem for all people wanting to change things, but more so for marxists because marxism proposes such drastic changes. I wasn't attempting to criticise the marxist model per se, just stating that there is next to zero possibility of marxism ever being adopted.

Saying this, I think there are better ways to make the economy function than to simply replace it with a different system.

Well the Labour Party started out trying to 'make the economy' function 'better' - I presume you mean work in the interests of the vast majority of the population - and look where the Labour Party is now.

Could you perhaps be more specific and suggest what these 'better ways' might entail?
Gra

 

[ItWillNeverWork]

Well the Labour Party started out trying to 'make the economy' function 'better' - I presume you mean work in the interests of the vast majority of the population - and look where the Labour Party is now.

Could you perhaps be more specific and suggest what these 'better ways' might entail?
Gra

Yes, sorry, I was trying not to be too specific because I have just posted quite an indepth post on the subject in the 'theory' forum. Didn't want to appear to be spamming. If noone objects I can repost from that thread?

 

[soulman]

Was capitalism ever alive in the first place?

This may seem a silly question but I am trying to make a serious point with it. Capitalism changes and develops in response to new situations. So this present crisis will pass and perhaps the old model of 'capitalism' will go. But there will be a new model to put into its place.

And I think the other side of the crisis will go one of two ways:

(1) The relatively benign option. Towards new technologies, like the internet, fibreoptic broadband or whatever the new technology thing is going to be, that we don't yet know about. (Like the invention of printing, the industrial revolution, the shift into electonics etc)

(2) The nasty option. An intensification of the War Against Terror. (model this one on the effectively Keynsian intervention in the economies in the run up and during WW2.)

It's not a silly question at all. Pure capitalism as envisaged has never worked. The free market and the invisible hand has always been closely followed by state intervention to regulate what is and always has been a flawed economic model.

But while it has been able to deliver an increased standard of material life to those of us in the countries who adopted it in the C19 it has been accepted. My thoughts are around what will happen when it fails to deliver.

The reality is that we are already at war, part of a permanent war on terrorism that was introduced as the US economy was heading into freefall. That hasn't done the trick for them.

The internet, despite the encroaching business model trying to be introduced, remains relatively free.

Where capitalism and the state have been successful for now is in the introduction of ever more oppressive legislation around personal liberties and the collection of personal data. They are doing that for a reason.

 

[butchersapron]

As i've just noticed gra is on the thread i need to point out that mentioning marxist economic models doesn't imply agreement with those models

 

[butchersapron]

Where capitalism and the state have been successful for now is in the introduction of ever more oppressive legislation around personal liberties and the collection of personal data. They are doing that for a reason.

Are there any conflicts betweent the state and capital today? Are there any competing imperatives?

(general question btw, just hooking it on your mention of 'capitalism and the state ')

 

[rollinder]

just read this - Atillia The Stockbroker's view

 

[elbows]

just read this - Atillia The Stockbroker's view

Interesting. It would fit well with the 'left is dead' thread too.

 

[lights.out.london]

So is it in the death throes or what?

No.

 

[davgraham]

Yes, sorry, I was trying not to be too specific because I have just posted quite an indepth post on the subject in the 'theory' forum. Didn't want to appear to be spamming. If noone objects I can repost from that thread?

OK - I had a look at the theory forum and its a fair question that you ask.

I think the link to wikipedia shows that Marx [and those of us who still use the tools he gave us] did not believe that 'boom and bust' is specifically caused by finance. Rather it is inherent to the cycles of accumulation [or what 'economists' call 'growth']

However what is certainly different to Marx's day is the relative size of the 'normal' economy producing goods and services and making profits that are then distributed to shareholders etc and the hugely bloated financial sector which produces very little in surplus value - as products to be sold - but instead deals in claims and shares of claims and shares of shares of claims on income streams. In some way this is made possible by the mechanism of fractional reserve banking as described in the theory thread.

The effect of the 'big bang' in the City was to considerably loosen controls on this fractional reserve mechanism which of course resulted in the vast increase in 'fictitious capital' in existence. Lauren Goldner has some interesting ideas on this.

However the dangers inherent in fractional reserve banking especially when related to fiat [or paper based money] have been recognised for a long time. The old solution to limit this was to force banks to hold real assets rather than paper ones to restrict this type of credit creation. At one time a section of our rulers was much taken with gold and silver as reserve currencies since this disciplined the banks. Henry George was a radical advocate of 'silver money' as part of a Populist Movement in US politics at the end of the 19th Century, who argued that banks should be popularly owned to create credit only for the real wealth creators by whom he meant small scale business. At an earleir stage of economic development Proudhon had advocated something similar with 'national workshops'.

But since then and the final abandonment of full convertibility of the dollar with gold was abandoned by the Nixon administration in the 70s the idea has never seriously been entertained. The reason is quite simple - the continous slow erosion of wages by inflation is better achieved over a period of time rather than in occasional sharp crises of devaluation, when changing parities make it obvious that the 'pound in your pocket' is most definitely being devalued.

Sorry for the long detour into economic history - but when I asked about specific proposals I merely wanted to know if you had some new ideas or whether you might be proposing/ thinking of something that has alread been in fact tried and rejected by our rulers.

In addition butchers has asked a very pertinent question which is what is the role of the state in all of this? Are we going to be forced into saving for instance or how much of the mortgage market is now going to be controlled by state firms? These are real tendencies in the economy we have to deal with and I'm not sure the attempt to work out ideal solutions as to how the 'market' or the 'economy' might be made to work better for us is the task before us since that, plainly, is not on the agenda.

ATB

Gra

 

[davgraham]

Oh dear I appear to have killed the thread with a long post - sorry

Gra

 

[Steve Booth]

Another Day - Another Disaster

Every day seems to bring some new disaster. Yesterday it was the failure of the US government to vote through their so-called 'rescue package'. It seems to me that this is a sticking plaster approach and that the blood loss is much greater than that. So what happens when the US runs out of sticking plaster?

Yes capitalism is a vastly incoherent system. Re the osciliation between the free market and the state intervention, to use another metaphor, it is like an inaccurate clock which every so often is reset to the correct time, but then begins to run fast or slow again.

Recessions are also like the 'Sign induced stop-go' on the motorway. Everybody is driving along OK and then there is one of those matrix signs telling people to slow down, so shortly afterwards the whole lot has stopped. Yet there is no reason for this. It's the same volume of traffic going through the same three lanes, there are no road works or crashes. A while after this, it gets going again, and then in a few miles time, there is another sign, and the stop-go cycle repeats itself.

 

[Steve Booth]

Renewal of the War on Terror

Why only one of two ways? It could go both ways. Also, new technology or war will not sove the underlying problem with the current form of capitalism.

Undoubtedly Capitalism will evolve into something different and at the moment it seems as if it will be charactorised by a state ran financial sector alongside a free market in other industries.

Thats just me speculating though.

I agree with this, that it won't solve the underlying problem. But I still think the two alternatives presented are the basic choice in front of the system.

Both of these might happen, but in my opnion, one of the two will have the upper hand, and the other option will be subordinate. You could have a technology based resurgence, and the War on Terror peter out. Or you could have lots of new technology stuff, but all this being essentially froth or a distraction and the real driver being the War on Terror.

And I think the War on Terror side of this is the most likely option.

 

[e19896]

“underclassrising is a modern day concept whose purpose is to, educate, lead and direct today’s teenage working class energy, anger and hate in a positive direction. Through health, fitness and challenging pursuits, underclassrising will clear your mind, body and soul, and prepare you for any challenge. underclassrising will lead you away from drugs, gangs, poisonous TV propaganda and all the sickness now destroying your lives and future. underclassrising will equip you with all the tools necessary to achieve this. Only through underclassrising will you be able to fight back and survive in today’s confusing world”.

underclassrising.net

 

[i386]

capitalism is ageing.
problem is that there's no better alternatives at the moment.
in other words, this means it is still not the end, unless the world gets fully capitalised.

 

[treelover]

Housing co-ops, squats, social centres, LETS, growing our own food, whatever. But lets hope a great deal more happens in the future than has happened up to now because these things, though not non-existant, are way too thin on the ground.
Reply With Quote

While having the best intentions, this DIY culture is in may ways elitist(yes, I know that is also what the SWP say) and is certainly not inclusive: what if you are very old, severely disabled, mutual aid can only go so far. Imo, it is somewhat naive in the extreme to think that self help, mutual aid etc could provide for millions. The welfare state is necessary to provide for and support millions who cannot DIY or even get to the the myriad post capitalists social centres etc which anarchists and others hope will appear.

 

[IC3D]

 

[poster342002]

(2) The nasty option. An intensification of the War Against Terror. (model this one on the effectively Keynsian intervention in the economies in the run up and during WW2.)

TBH, I think there's an increasing chance of a major face-off with Russia which will make the War on Terror an irrelevance.

 

[dennisr]

TBH, I think there's an increasing chance of a major face-off with Russia which will make the War on Terror an irrelevance.

oh, look, its mr. happy

 

[ViolentPanda]

TBH, I think there's an increasing chance of a major face-off with Russia which will make the War on Terror an irrelevance.

I disagree.

"Face offs" with Russia will probably continue to be either diplomatic or through proxies, rather than direct confrontation. Why? Because they're still not technologically self-supporting, and they need the markets that both the east and the west provide.
Plus, they have their own "Islamist" problems that necessitate close interaction with NATO etc, despite stuff like Georgia.

 

[Steve Booth]

Getting the plates spinning

TBH, I think there's an increasing chance of a major face-off with Russia which will make the War on Terror an irrelevance.

It's a question of getting the plates spinning again. A face off with Russia would probably be to do with those gas pipelines, or the Baku-Tiblisi-Ceyhan oil pipline running through Georgia. The Russians seem bent on holding Western Europe to ransom with this. Western Europe has been comparatively weak - see today's news where the European 'peace keepers' weren't being allowed in by the Russians. If they turn the taps off, then people will look for other supplies, like Britian did with the Norway pipeline; or people will invest in alternatives like turning sugar beet to ethanol.

You may have a point with the possibility of a Russia face off - it sounds to me too much like a return to the old Cold War. It is notable however, that during these financial crises, the Russian stock exchanges have shut down rather than face up to the market turmoil. So does Russia's economy seem strong enough to go into a conflict with the West?

The War on Terror, on the other hand slowly seems to be gathering pace. The recent troubles between the US making incursions into Pakistan and being fired on, for example. This trouble over the armaments ship seized by pirates off the Somalian coast. Hardly a week goes by without some more terrorism arrests in Britain. Some sort of airliner plot was foiled in Germany just
a few days ago.

If it was ramped up, it would prove a big money spinner for them. (the capitalists)

 

[kyser_soze]

It's not the end of capitalism - as taffy pointed out, it's a global reallocation of capital (maybe not even that) thru to an overdue shake out of a banking system that had gotten too clever for it's own good (and ours).

Russia's current noises are simply part of the return to Great Power/multipolar politics...there'll be another major (as in globally distributed) war before the half century is up I reckon...

 

[audiotech]

Russia’s stocks have dropped by 57 percent since last May. This week Russia’s main stock exchange suspended trading for two hours in an attempt to stop the collapse.

The recent 28 percent drop in the price of oil has led to fears that Russia could also be plunged into a deep recession.

The Russian economy was devastated in the nineties in the move to free market capitalism. With inflation rising and wages stagnating, Workers in Russia have not benefited from the recent boom and have had to increase their debts to make ends meet. They will be the main victims of any crash.

Russia’s defence spending is reportedly to rise by 27 percent next year to £95 billion this will increase the tension between it and the US.

 

[Bernie Gunther]

Some sort of large-scale recomposition is clearly on the cards, and it seems likely that the effort will be made by the concerned states to continue to prop up the value (or most of the value) of a mass of ficticious capital through various kinds of intensified looting, because otherwise where would additional surplus value come from under the present arrangements? So I'd expect heavy propaganda to convince people that such looting is inevitable/necessary.

 

[Steve Booth]

The Russian economy was devastated in the nineties in the move to free market capitalism. With inflation rising and wages stagnating, Workers in Russia have not benefited from the recent boom and have had to increase their debts to make ends meet. They will be the main victims of any crash.

Occasionally you get these documentaries or articles in the newspapers about the former collective farms. These places used to be huge agricultural factories, but with the collapse of the Soviet Union, most of the people moved away. So the fields are given over to scrublands, the buildings mostly lie derelict and just a few old women are left. There is a similar thing about Siberia, where they had these big industrial towns mining rare minerals, perhaps, and many people left, so the whole area is depopulated and a sort of hopelessness settles in on it all.

 

[lewislewis]

the best we can hope for is a social democratic re-ordering of financial and state practise. It's still not the abolishion of monetary fetishism I dream of but a re-surgence of socialist practise amongst the financial sector would be nice.
Sadly I don't think that will happen. It'll be 'fuck you jack' imo.

Unless maybe the shit reaches 30's style depression. If poverty starts to hit the bourgeois in an appreciable fashion. Maybe then the principle of 'fuck your fellow man before he fucks you' will die. The pernicious lie that a monetary system has to be destructively competitive must bow out It has had it's two centuries

I kind of agree. Media and propaganda points taken into consideration, although capitalism is going to survive this crisis it is going to be a heavily regulated, less free market version. Certainly the neo-liberal dream is over. They can make as much propaganda as they like but it won't matter if the system doesn't work.

I think there is a potential to think up a kind of socialism that would gain popular support and could be implemented in these conditions.

I'm extremely worried about the prospect of some kind of war, especially with nuclear weapons lying around. The UK is a fundamentally imperialist state and always will be, but I am hoping there's a prospect of living in some neutral European country that doesn't participate in any superpower clash (or maybe trying to create such a country here).

 

[lewislewis]

It's not a silly question at all. Pure capitalism as envisaged has never worked. The free market and the invisible hand has always been closely followed by state intervention to regulate what is and always has been a flawed economic model.

I need some education on this but I read somewhere that the original theorists in capitalist thought never envisaged some kind of unrestricted, unbridled version of capitalism, and that Adam Smith believed in regulations and controls on the market. Is this generally true?

 

[darkfibre]

Smith saw the 'free market' as a means to achieving 'the common good' or equality - with our innate morality (now lost?) steering the boat.

Keynes too, saw it as a means to an end.

Neither noticed that a system predicated on perpetual growth fuelled by limited resources might not be such a fantastic idea, let alone that it would end up driving the sort of geopolitical feedback loops discussed above.

Once the looting is over, the 'State' becomes hollow, with interests increasingly at odds with those of 'Nation'.

None of this means that Smith, Keynes etc. have nothing useful to teach us, though... Far from it.