The fundamental contradictions of capitalism lie in its inability to make proper use of technical improvements in productivity. There’s no point in enlarging the world’s capacity for stuff if there’s poverty and unemployment; there’s simply not enough actual wealth to buy the stuff (then social democracies pay billions in subsistence too). Marx prophesised this.
Saving and investment , unless they minister to future consumables, are sheer waste.
The system is decaying, but it remains powerful. The need for profit cocoons an elite and beefs up the forces that protect them. Capitalism will recover from this crisis with a few dirty tricks. Millions will be thrown out of work, fed on a poor diet and given the illusion of empowerment via elections and X Factor. Perhaps even a war; the 1930s crisis that followed the Wall Street Crash hastened the fact that many capitalists looked the other way as the Nazis rose to power. We mustn’t think that this new crisis sees the end of Capitalism. The capitalist is a tough guy. When democracy threatens to bring him to book for his incompetent stewardship of economic affairs he hits out first. To the Capitalist, democracy is an expedient; property is sacred.
As in the 1930s European governments are trying to placate capitalists by not taxing or regulating them properly. Cuts do not invoke confidence, they simply rain a load of loose change around. The attempts to ‘balance’ the ‘budget’ then, as now reduces consumer spending power and disappoints the profit expectations of capital. All those people squirreling away stocks (as goods, property and paper shares) were confident their wealth would grow forever as they sat around producing nothing. From a simple and homely perspective, it became received wisdom that house process would rise forever (but this simply fuelled the mortage market, which is just big loans). Curse you, Kirsty Alsopp!
Thanks to our relatively free media (save the BBC from Tory attacks!) more people than ever are grasping an understanding of bond markets (governments borrowing money from capitalists to pay for services). There are distinct similarities with 1932, when the British government also boasted of business as usual on the borrowing front, then, as now, the UK economy could weather the storm by having a strong creditor standing in the outside world. Then, as now, we see life in the home counties little affected as the industrial north, Scotland, Wales & Northern Ireland get it harder. We’ve seen Capitalism in its true colours, a near police state which will not tolerate mass protest. Capitalism can keep millions idle. The Labour party is an humiliating carcass of what was supposed to be the political wing of the Labour Movement (Don’t forget what the movement’s done for you, baby).
This is why, as Socialists, we must be very clear about what to do next.
We must start from first principles and build a new model for how the economy functions. Right now every one of us is obsessed with ‘growth’. The way our economy is structured means that unless there is ‘growth’ people lose their jobs, the tax base shrinks and politicians struggle to fund public services. We MUST break that vicious cycle by building a new macro-economic model that is geared not towards ‘growth’, but towards achieving the outcomes that are important to society and that can be sustained by the planet’s finite carrying capacity. Our approach is simple. We will start with the hard outcomes we need – environmental sustainability; equitable economic justice; and high levels of human well-being – link these to relevant economic determinants within the model (aggregate output, income distribution and working hours, respectively, for example) and to ‘reverse engineer’ what this would imply for the levels and types of differing inputs.
We on the ‘Deft Left’ do not see Socialism as fundamentally inevitable, but we believe that the alternative to Socialism is decay. Without a push towards Socialism every slide downwards of Capitalism will make it harder to rebuild society. Unless we get moving sharpish, it will leave behind a welter of destitution and inefficiency, and the next phase of history will be one of rebuilding rather than improving. We can build on the foundations of human teamwork that, for millennia, have been based on the simple struggle with nature, the arts of civilized living (such as fire, innovation and Rhythm ‘n’ Blues) and the value of human happiness.
Above all we must have an analysis. When your neighbor, co-worker, relation or chum complains about inefficiency, governance or immorality you MUST explain the forces which control any given situation. Don’t leave it to the stand-up comedian. You must explain that the division Capitalism has created will lead to its downfall. We must explain that we are pro-work, that we are pro-achievement, that we are not for MOLDING everyone into a particular pattern (but we are all for COLIN MOULDING, our campaign for better bass-lines, which we just thought of there). Capitalists have convinced us that due to ‘human nature’ we are not decent enough to co-operate, or that we subordinate individual greed to the common causes of human happiness. That doesn’t sound like you. You would like to promote fellowship, development and co-operation. This can only be done with a proper adjustment of the prevalent economic factors. We cannot stand by and watch the world’s resources wasted.
This is the cultivation of social evolution. True growth.