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Capitalism and Post-Capitalism
CERIUM, July 3, 2010
Pierre Beaudet
What we will discuss today
1. Capitalism, an historical construct
2. Again on the Contemporary Crisis
3. Life after capitalism?
Capitalism, historical construct
The first 1000 years
• Early ‘civilizations’ were based on agriculture and
small military/religious elites capturing the visible
‘surplus’ through slavery and serfdom.
• By the turn of the millennium, that surplus became
bigger particularly in China and India, and later in
Mediterranean cities.
The Asian Surge
• Markets became bigger and
autonomous. Products became
merchandises. In China
however, markets remained
under the control of rural
gentries and a strong state with a
‘modern’ bureaucratic
infrastructure. Until the 1800s,
the Chinese economy was more
advanced and the society more
stable than in Europe.
Predatory Europe
• In the Mediterranean cities, the process was more
painful. The ancient (Roman) State was destroyed
and Europe became dislocated into a myriad of
competing City-States. These cities were to
become later expansionist and ‘predatory’ against
the rural surroundings on the one hand, against
other city-states and foreign territories.
The new bourgeois
• Under ‘modern’ European-style
capitalism, the new ‘bourgeois’
became rich through the colonial
plunder and forced changes on
ancient regimes. The old ‘puttingout’ system of contracting rurals
was slowly replaced by
‘manufactures’. Peasants were
expropriated by millions. Great
wars plagued Europe for centuries.
The plunder
New state
• Imperialism was reinvented and
central in the European ascent.
In Europe, primitive
accumulation continued its
course through expropriation of
peasants and ‘proletarization’.
Manufactures became
‘industries’. After many political
convulsions (French revolution
of 1789), the modern state was
born.
Modern capitalism is
revolutionnary (Karl Marx)
The bourgeoisie cannot exist without revolutionizing the
instruments of production. Constant revolutionizing of
production, uninterrupted disturbance of all social
conditions everlasting uncertainty and agitation
distinguish the bourgeois epoch from all earlier ones.
All fixed, fast frozen relations, with their train of
ancient and venerable prejudices and opinions, are
swept away, all new-formed ones become antiquated
before they can ossify. All that is solid melts into air, all
that is holy is profaned, and man is at last compelled to
face with sober senses his real condition of life and his
relations with his kind
Changes from the top
• Capitalism has revolution in its ‘genetic’ code.
Accumulate by transforming goods, services,
people, into merchandises.
• Moving from use to exchange value.
• Appropriating labor power (through
expropriation)
• Possessive individualism and reification of the
material.
• Everyone becomes against everyone, and against
all non-human forms of life.
Demographics and urbanization
State, Empire, War
• Capitalism expanded world-wide, forcing modern
states towards confrontations.
• The world was divided into ‘spheres of influences’
and colonies (Berlin conference)
• Imperialism led to the First World War (1914). It
was the greatest massacre of all times. But then
the system cracked.
Resistance
• But capitalism and imperialism
were challenged by proletarians
in the factories and shantytowns
of Europe and. It was fought by
colonized peoples during the
imperialist drive.
• What’s the image on the right?
Soviets
Marx in Detroit
• Capitalism was also fought
by ‘modern’ mass workers
of the 20th century.
• What is the photo on the
left?
The greatest movie of all time on modern capitalism
The Keynesian ‘revolution’
• In the 1920s and 1930s, modern
capitalism was on the brink. The 1929
crash was the trigger and the symptom.
Revolution was in the air (Soviet Union).
• John Maynard Keynes saw that to
survive, the ‘invisible hand’ of the
market had to be regulated by a strong
state redistributing the assets so as to
integrate a larger part of the popular and
the middle classes in ‘benefiting’ from
capitalism.
War (again)
• The USA took the lead in the
Keynesian ‘revolution’ with
the ‘New Deal’. But then it
had to confront the rise of an
alternative capitalist
‘revolution’ from fascism and
German imperialism. There
was then an extraordinary
alliance between Keynesian
‘revolutionaries’ and
socialists (USA + USSR).
The new phase
• After 1945, US-led modern capitalism was the
lead, although the ‘Soviet bloc’ was also powerful.
Then emerged a new actor, the ‘third world’. For a
while, the balance of forces was ambiguous.
• The US reshaped the world by integrating the
Americas, Western Europe and Japan into the
‘western world’. It became ‘globalized’ through
the American ‘way of life’.
Coca-Cola-ization, Disney-ilazation,
MacDonald-ization, WalMart-ization,
etc.
But it was not so stable after all.
• Western/US capitalism
was squeezed by the
irruption of the third world
in the 1960s and by
rebellious students and
workers in the world
revolution of 1968.
One planet three worlds
While another actor came on the stage
As history moves …
• But Capitalism changes and
adapts all the time.
• Since the 1980s, it
transformed itself through
neoliberalism: weakening
popular classes through new
policies of deregulation,
privatization, outsourcing,
relocalization.
• Again it triggered lots of
resistance.
What about now?
• The elites are trying to save capitalism by
transferring the ‘bill’ to middle and popular
classes, perhaps adding a touch of ‘green’.
• The discontents are include reactionary elements
who oppose capitalism on the basis of backward
rightist projects using the language of identity and
religion.
• The ‘lead’ country, the USA, acts like a wounded
tiger, in decline but fighting hard, not only people,
but emerging competitors.
Thinking the unthinkable
• What is now in front of us? The unthinkable
becomes thinkable like the catastrophic chains of
events from environmental crashes to collapse of
economic systems. Who will feed the people?
Listen to Vandana Shiva.
• The unthinkable also includes more war. On the
other side, there is a return to social-democracy
and Keynesianism. Finally there is also a
discussion about ‘socialism of the 21th century’.
End of First Part!
2. Contemporary Crisis
危机
• Since the late 1980s and until the summer of 2008,
policies associated with capitalist globalization
were usually presented as a «global» success.
• There were problems admitted Wall Street, Bush
& Harper, and the World Bank, but more or less
everything was «on track».
• Since the crisis erupted, the dominant discourse
has been, «The system is fine, let’s fix it».
• Obama
Financial meltdown
• Over $16 trillion in total
market capitalization has
been wiped out since
2008.
• You have been
discussing this over the
last days …
Why?
•
•
•
•
Bad banking practices?
Bad apples in a still good basket?
Too many crooks?
Or trying to bypass structural dimensions of
the crisis?
Robert Brenner
• The rate of profit is down because
of overcapacity in global
manufacturing industries, related
to increased competition (China,
Japan, Germany).
• Profits are squeezed, forcing down
profits and wages. Capitalists
invest more to meet the challenge,
thus reinforcing the race.
The irresistible decline
• Manufacturing jobs migrating to the south. 3m
jobs from the USA (average $16 an hour) moved
to China ($0,61) between 2001-04.
• Relocating and outsourcing is profitable.
Employers diminished job security, work rules,
pensions. Labour is «feminized».
• GM is involved with Daewoo, Shanghai Motors,
Fiat, Fuji, Saab. Decentralization of production,
concentration of economic power.
• Over 43 million Americans will use food stamps
by the year 2011.
Rich getting richer and poor getting poorer
(USA)
14% more millionnaires in 2009
CEOs' pay in the USA as a multiple of the
average worker's pay, 1960-2005
The crisis will stay for some time
Joseph Stiglitz
‘Financiarization’
The financial sector has thus
turned on itself.
• The result is an increased
bifurcation between a
hyperactive financial
economy and a stagnant real
economy. In 2006, the
average daily turnover in
global currency markets was
$1,5 trillion.
• Between 1995 and 2005, the
five biggest Canadian banks
avoided paying $16 billions in
taxes.
The Canadian angle
• The Canadian deficit in
trade (2009) was $4.3
billion ($62 billion
surplus in 2005). 80 %
of Canada’s total exports
are going to the US.
• In January 2009, the
federal government
introduced a $40 billion
dollar stimulus package
including investments in
infrastructure and tax
reliefs.
The good news?
• Contrary to the US, the banking sector in Canada
was less fragilized. Canadians banks are not as
fragmented as they are in the US (the six largest
Canadian banks hold more than 90 percent of
assets), more regulated and less inclined to risky
financial operations. Billions of dollars were
nevertheless lost by Canadian banks
‘contaminated’ by ‘toxic’ funds (sub-prime loans
and other speculative investments).
The rich are doing fine
• The richest 20 % of Canadians enjoyed median
earnings increases of 16,4 % but the poorest 20 %
had a 20,6 % drop in earnings since 1980. The
total average compensation for Canada’s highest
paid 100 CE0s was $7,3 million in 2008 compared
with an average $42,300 for all Canadians. Since
1995, tax revenue in Canada has dropped from 36
% of GDP to 33 % of GDP (loss of nearly $50
billion a year in public revenue).
The bad news
• In the first year of the crisis, 600 000 jobs were
slashed in Canada (50 % not recuperated in 2010).
The number of unemployed (over 1,5 million
people) in the spring of 2010 was 31 % higher
than it was before the crash in 2008. More than
43% of the unemployed do not receive UI,
• According to latest Statscan, three million
Canadians are under the poverty line.
Impact on the most vulnerable
• At the world level
unemployment up by
239 million in 2009. The
number of working poor
living on less than a
dollar a day could rise
by some 40 million —
and those at 2 dollars a
day by more than 100
million.
Food crisis
• In 2005-08, food prices have risen by 75%. In the
first months, prices are higher than they have been
in decades. Rice, bread and tortillas are the staple
food for this half of the world’s population. In
2007, the price of grain rose by 42 %, and dairy
products by 80 %, according to UN figures.
• Why?
Fix it! But how?
• More control (regulation) over financial
institutions.
• Investing into the rehabilitation of infrastructures.
• Invest into education and retraining of workforce.
• Employers are asking trade unions to accept cutbacks in order to maintain jobs.
• Bill Gates on saving capitalism.
Is it the end of capitalism?
Not so simple …
• Hear I. Wallerstein … Perhaps
• http://www.youtube.com/watch?v=nLvszWBf6BQ
&feature=related
End of part 2
Life after capitalism?
• There is a terrible lesson
in history … Indeed the
last two «global crisis»
(1872 and 1929) led to
two world wars.
• Today the epicentre of
the conflict is in the
Middle East with
abundant oil resources.
• Is it possible that these
conflicts will turn into
full confrontations?
The world according to the United States
US remilitarization?
•
US military domination
‘Full Spectrum Dominance’
• The US administration wants to maintain military
supremacy on «all fronts».
• High tech including space, nuclear, and «new»
WMD.
• On the ground with permanent military bases and
huge capacities to transport troops everywhere.
• Through military alliances mobilizing troops
under US command, such as NATO.
The endless war?
Breaking the international law
Empire in decline or wounded tiger?
• 9/11 accelerated a trend
that had started back in
the early 1990s to
‘reengineer’ the Middle
East. The obvious
reason is oil. The less
obvious is geopolitical,
in the middle of
Eurasia. But so far the
US failed.
The Eurasian challenge
• The US is loosing out in the big ‘game’
against the EU (technology + economy). It
is afraid of a new alignment of forces that
would pull the EU towards Russia and
China.
• Already China is making gains in terms of
influence in Asia, Africa, the Middle East.
• Can China become a superpower?
China in the world
•
•
•
•
•
•
•
•
China
9,0%
India
6.4%
Canada
2.1%
Japan
1.7%
US
1.5%
UK
0.9%
Germany
0.3%
Source: IMF 2010
Ambiguous confrontation
• China and the US need one another. China
cannot compete militarily, yet.
‘BRICS’ and other spoilers
• What is BRICS or BRIC?
• What is MERCOSUD? ALBA? ASEAN?
Shanghai Security Organization?
• Can China and the other BRIC(S) ‘reinvent
capitalism? What form would it take?
Can Obama fix it?
Visible and invisible Flash points
What about this?
The other challenge of the empire
• The US needs to ‘clean’ its own internal
scene by recreating a sort of a ‘consensus’,
after the terrible Bush years of
confrontation on race and class.
• It is not easy because class polarizations
have taken a ugly turn with immigration.
• The ‘security issue’ partially pushed-up by
9/11 is changing the system of governance.
Return to Keynes?
• Does capitalism still have ‘another’ option?
• Shift the economy from ‘financiarization’.
• Invest massively in human resources and
infrastructures.
• Rebuild an adequate fiscal redistribution.
• A ‘new’ (green) New Deal?
• Do you know Amyarta Sen?
• http://www.youtube.com/watch?v=z-HZ3i1mzrU
Can it work?
• Who can be part of that ‘new’ new deal?
• Read Jim Stanford (CAW) and the
Progressive Economics Forum
• Jean-François Lizée can explain it at
length…
Is there another option?
• For most of the 20th century, there was a
proposal called ‘socialism’ which claimed
the inheritance of Marx and socialists of
that time like Rosa Luxembourg, Lenin,
Gramsci and countless others. Then
socialism was embedded with the Soviet
Union. And later with Cuba, China,
Vietnam, etc.
Socialism: too early or too late?
• In 1989, many though that
socialism was definitely dead. It
was the ‘end of history’.
• For sure, the collapse revealed
deep fault lines in the political
process (dictatorship), economic
development (eco-hostile) and
otherwise. How can one forget
the gulags?
No turning back
• No one would accept the ‘excuses’ although some
of the arguments were valid. Socialist countries
were surrounded by hostile capitalist states. They
were from the beginning poor and deprived (China
and the USSR in particular).
• But that idea that a ‘single’ project with a ‘single’
ideology with a ‘single party’ with a ‘single
leader’ can save the world is gone …
Rereading Marx, Lenin, Gramsci
• There are lots of debates and research out
there. For example, Marx is not the
simplistic ‘economist’ who thought that
capitalism would fade away to a better
‘economic’ system (Socialism).
• Lenin and Gramsci thought of radical
changes over long period, not through
‘quick fixes’ and military adventures.
Nonetheless, there is life after capitalism
• Capitalism is an historical construct,
corresponding to social and political struggles, not
the ‘end of history’.
• The idea that human beings can cooperate rather
than compete might not be that crazy.
• The ‘merchandizing’ of the world needs to be
checked to save humankind and the planet.
• Can the ‘rational’ prevail over the ‘irrational’? It’s
a big bet …
The South American Laboratory
• Something new is
developing south of
there and it came out
of massive struggles
of the last three
decades against
neoliberalism.
• In Argentina, it was
called, ‘que se vayan
todos!’
Political Creativity
• New political formations
appeared in Brazil and
elsewhere. The won
elections after prolonged
engagement and battles.
How to be ‘reformists’ and
‘revolutionaries’?
• The correlation of forces at the national and
the international level (GLOCAL) is not
favorable to change. Chaos can come
rapidly.
• How to redirect economic capacities and
power?
It has to come from below
• The political scene is one among many sites
of confrontation. There is a big ‘battle of
ideas’.
• Progressive governments are debilitated
unless they are pressed and supported by the
grassroots.
Have you heard of the MST?
mouvement
Re-establishing Human Dignity
Democratizing democracy
A long and winding road
• It includes the ‘right’ to
say NO. Mass civil
resistance can be very
effective (but it ain’t the
only way).
It is dangerous
Sometimes people feel they can make a
point
I have a dream
It can only be ‘glocal’
The World Social Forum, 2001-2010
•
•
•
•
•
2001:
2004:
2007:
2009
2010:
• 2011:
First WSF in Porto Alegre (Brazil)
4th WSF in Mumbai (India)
6th WSF in Nairobi (Kenya)
7th WSF in Belem (Brazil)
2nd US Social Forum (Detroit)
European Social Forum (Turkey)
Forum of the Americas (Paraguay)
World Forum on Education (Palestine)
World Forum on crisis (Mexico)
8th WSF in Dakar (Senegal)
There are victories sometimes
Glocal also means this
• You can reach me: [email protected]