How The Liberal Left Helps Capitalism; A Reply to “Political Affairs” on the Elections
By MN Roy
So according to Thomas Riggins, associate editor of “Political Affairs,” not voting for the pro-war and pro-Wall Street Democrats smacks of “ultra-leftism.” Surprise, surprise. For those not in the know, “Political Affairs” is the mouthpiece for the reformist Stalinists of the mis-named “Communist Party.” The latter have been making a living on the left by supporting almost any and every Democrat since Uncle Joe Stalin himself instructed the CP to support FDR in the 1930s and derail any moves on the part of the CIO in the direction of an independent labor party. All in the name of “anti-fascism,” of course. Only the biggest “fascists,” the Jim Crow “Dixiecrats,” were to be found inside of the Democratic party, and were a key component of FDR’s “New Deal” coalition since they controlled the white-only single-party South.
The immediate target of Riggins’ wrath would appear to be anti-electoral anarchist types who oppose participating in capitalist elections on principle. However, he’s probably even more aghast at those supporting the independent campaigns of Ralph Nader and Cynthia McKinney. For the latter are challenging the Democrats from within the electoral arena and, therefore, constitute an even bigger threat to them. And unlike Obama and the Democrats, Nader and McKinney are actually anti-war and anti-corporate. But as all graduates of the Stalin school of class collaboration know, voting against the Democrats not only constitutes “ultra-leftism” but “helps” the Republican “right” as well.
According to this “logic,” the Democrats are supposed to be on the “left.” That would come as quite a surprise, if not a shock, to them, let alone to the Wall Street swindlers and speculators who were bankrolling Obama big time even before he helped push through the “bail-out.” It would certainly raise the eyebrows of Colin Powell, Paul Voelker and Warren Buffet, hardly individuals who would give thumbs up to anything remotely “progressive.” Or maybe the “left” that Riggins is alluding to are the respectable reformists of the CP and the rest of the “progressive community” that shares their infatuation with “lesser evil” politics.” Only what’s “left” or “progressive” about voting for a party that supports the wars in Iraq and Afghanistan as well as soaking the poor to bail out the rich. Or maybe I just don’t understand “dialectics” since I never got around to reading any of Uncle Joe’s lamentable tracts on the subject.
Of course, what all of these labels leave out of the picture is any discussion of capitalism and class. Or that the Democrats, no less than the Republicans, are a party of, by and for the capitalist class. Only, they have a division of labor, working separate sides of the street. While one may work on Wall Street, while the other does so on Main Street, they both work for Wall Street.
No less than the musings of the mainstream media, terms like “left,” “right” and “center” are deliberately designed to prevent working people and “movement” activists from reaching any kind of radical conclusions that it is the system as a whole that is the problem, rather than the dirty doings of the “ultra-right” or the “neo-cons” around Bush and Cheney. This is more necessary than ever since both of capitalism’s candidates have essentially the same program of increased imperialist aggression abroad and making the workers pay for the crisis that capitalism caused at home. And in the midst of the on-going debacles on Wall Street, capitalism stands more nakedly exposed than ever.
Sure, there are the usual dime’s worth of differences around “social issues” that don’t cost the capitalists anything. They have to be magnified out of proportion so that there appears to be such a great divide between the Coke and Pepsi candidates. Then the reformists can hoot and holler about keeping the “ultra-right” out of office at all costs. But if they didn’t have some second-rate issues separating them, then the two-party con game would cease to function as the most effective method yet devised of maintaining the rule of the few over the many. Besides, if the rad-libs make such a big deal over this kind of stuff, it’s mainly because they gave in long ago on every issue of substance, from the war to the bail-out, in order to get the Democrats, who rolled over in the Congress “they took back,” into the White House as well.
So when all is said and done, whether the author is Thomas Riggins, Sam Webb, Judith LeBlanc, Leslie Cagan, Gus Hall or Earl Browder, it’s still the same old Stalinist shit.
Whether it’s “popular front,” “fight the right,” “ABB,” “taking back Congress,” or just plain old “lesser of two evils,” it’s still the same old Stalinist shit.
Whether it’s opposing McCain, Bush I or II, Dole, Reagan, Nixon, Goldwater or supporting Obama, Kerry, Gore, Clinton, LBJ, and every one was the “most important election ever,” it’s still the same old Stalinist shit.
And no matter how you slice it, it still stinks as far as working people and radical activists are concerned. They go into that Roach Motel of the left, otherwise known as the Democratic party, as “radicals” opposing capitalism and come out as “progressives” trying to “reform” it or work within it. So while the Gus Halls and the Michael Harringtons may leave us, there’s always a Tom Hayden or a Carl Davidson waiting in the wings to take their place, telling us that electing a Democrat will “open up more space for the left.” As if the bought-and-paid-for politician pals of Wall Street will listen to the millions who vote for them rather than the millionaires who own them.
The reformists may delude themselves that a Democrat in the Oval Office may be more susceptable to “pressure” from below than a Republican, but they seem to forget that when you get taken for granted, the way they do with the blank checks they give to the Democrats every four years, you get taken. As Bill Clinton, who they also supported, once said, “where else will they go.” Certainly not to the streets, for they all kept quiet for Clinton’s 8 years of neo-liberalism and myriad of military interventions around the world, lest the Republican “right” get back in. No doubt, they will so the same for Obama, especially as they’ve kept the anti-war movement on hold for over four years. To paraphrase one of reformism’s leading lights, Howard Zinn, it’s who is in the White House that determines who will be (or won’t be) protesting outside of it.
Of course, in each succeeding election, it keep’s getting harder to tell exactly which candidate is the “lesser,” as opposed to the “greater,” evil or who is the “progressive” and who is the “reactionary” candidate. And this year’s contest is no exception no matter how many meaningless banalities and platitudes Barack Obama throws out about “hope” and “change.” Surrounded by Carter and Clinton era cold warriors and counter-revolutionaries and Goldman-Sachs “Chicago Boys” de-regulators, and endorsed by Bush gang war criminals like Colin Powell, Obama is even less likely to deliver any “change” than a meal from MacDonalds used to claim to do.
Both McCain and Obama supported giving the crooks on Wall Street $700 billion of the workers money and dictatorial powers over it to Henry Paulson, one of their own. Only Obama and the Democrats were even more gung-ho to do so, with no strings attached, than were the Republicans. Both of them also supported giving the rest of the government dictatorial powers over the American people, since they both voted to renew the police state “PATRIOT” Act and the revised “FISA” Act. And both support the death penalty. While you wouldn’t expect to hear John McCain speaking up for the likes of Troy Davis, let alone Mumia Abu Jamal, you won’t hear a word from Obama about their cases either. Indeed when the NYC cops who murdered Shawn Bell got off scott-free, Obama admonished his supporters in the Black community not to resort to violence!
Both McCain and Obama support George Bush’s “war on terror,” want to increase spending on the war machine and the size of the military to fight it, maintain the occupation of Iraq and intensify the war in Afghanistan. Both agree with George Bush that the “surge” was such a smashing success, that such a shift in focus is now, not only possible, but, desirable. Only Obama and the Democrats, who have been beating the drums for a bigger and better war in Afghanistan long before McCain jumped on board the band-wagon, sugar-coat it by calling it “withdrawal.” Obama’s even called for a “surge” of 15,000 troops in Afghanistan to make better use of the handful of combat troops he wants to “redeploy” from Iraq. And let’s not forget their shared enthusiasm for rocket-rattling against Iran and Russia. Only McCain, not Obama, is willing to negotiate with Iran over uranium.
Both McCain and Obama staunchly support Israel’s “right” to oppress the Palestinians, invade Lebanon and bomb Iran any time they please. Both just as strongly oppose the governments of Cuba and Venezuela. Only Obama went out of his way to condemn the Cuban revolution as constituting a “dark age” in that country’s history. Does that mean that he thinks that the rule of the US-backed dictator Batista and the gangster Meyer Lansky was a “golden age” for Cuba. It would indeed be strange for a Black man to think that, since Jim Crow was the law of the land under Cuban capitalism just as it was under American “democracy.”
Both McCain and Obama oppose any kind of real national health care plan or any other substantial increase in social spending since both of them voted to give away the farm to Wall Street and the Pentagon. Besides both are agreed that belt-tightening 1970s-style austerity is the only game in town insofar as working people go since the corporate crooks that support both of them aren’t about to pay for the crisis that they and their system caused.
Only it seems that more of them support Obama than McCain! They know that Bush and his gang of “neo-con” nit-wits have, in the words of last time’s “lesser evil,” John Kerry, “fucked it up,” and its time to change dicks if they’re going to keep screwing us. Whether its reflected in the amount of campaign contributions from Wall Street or endorsements from the likes of Colin Powell, most of the ruling rich feel that Obama, not McCain, is the preferred candidate for implementing austerity at home just as he is viewed as being the better man for the job of refurbishing the empire’s credentials abroad. I may be a little old-fashioned, but I didn’t think that it was the job of the “left” to help improve the image of imperialism!
After all, who better to bomb dark-skinned peoples around the world and who better to gave working people the short end of the already shortened stick, and Black working people the shortest end of it, than some-one who actually looks like them. As Democrat David Dinkins, the first Black mayor of NYC said, before he laid waste to the municipal budget and largely Black work-force at the behest of Wall Street, “they’ll take it from me.” No doubt behind closed doors Obama has re-assured his wealthy backers and supporters along those same lines. Only when he does it, it will be in the name of “shared sacrifice” and “national unity” since the “united we stand” rhetoric of the “right” no longer does the trick.
So then, who really helps the “right,” or rather the ruling class, in implementing their common class agenda of increased aggression and austerity? Those who oppose it and the Democratic party politicians that are a key component of implementing it or those who tell you to vote for those same Democrats year in and year out? Who was responsible for putting the anti-war movement on the back burners in 2004 and 2006 in order to elect pro-war Democrats? Who is responsible for demoralizing and demobilizing the thousands of radical activists who took on the system believing that “another world is possible” to the point that many of them would fall for the sound byte shenanigans of Obama? Who helps the mainstream media, even if only in a small way, in keeping any thinking about capitalism (and class struggle against it) out of working people’s minds in favor of meaningless monkey chatter about “progressive” versus “reactionary” politicians when the whole system is reactionary to the core? And who actually helps drive people into the arms of the “right” by associating the “left” with the neo-liberal austerity promoted by the Democrats at the behest of Wall Street. To ask the question is to answer it.
The only way to really fight “the right,” that is the capitalist class, is by building a strong and independent left that has a program and party to do so. You wouldn’t tell workers to vote for their boss to represent them at their jobs, so why tell them to vote for their bosses’ candidates to represent them in Washington, or anywhere else, for that matter? Now, more than ever, it’s time to make the break; to vote against Wall Street and its wars, to vote for Nader or McKinney, and begin to build a movement of, by and for the working class and against capitalism. Only to do so it will be necessary not only to break with the Democrats, but with their “progressive” apologists and hanger-ons, including and especially Thomas Riggins and the CP.
Loyalists celebrate the murder of Michael McIlveen (the flag can stay, but please remove the tires)
The sham “environmental movement” that insists the rescue of the planet from the ravages of capitalist accumulation be born by individuals and their “consumer choices” is just another marketing ploy. Sustainable capitalism is impossible since the nature of capitalist production is to expand: the limits to that expansion are only known when they are exceeded and we get the kind of crisis we have now.
“Green technologies” within the logic of imperialism don’t get us any farther. As my brother says; “if we had solar power tomorrow the United States would invade Jamaica for the sunny beach space.” Every night as I watch the increasingly awful Jim Lehrer Newshour on “public television” a guy comes on to inform me that the program is brought to my home by the good graces of that vanguard of environmental policy Exxon/Mobile. He looks like he might have been at Woodstock, or rather he looks like what the marketers at Exxon think, with his gray hair and hideous little soul patch, a veteran of that long ago youth festival might look like.
He pushes up his glasses and softly spews hokum about hydrogen and “green technology” for the automobile. That automobile, whose destructive impact on our environment goes well beyond carbon emissions. Exxon spent less than 1/10th of 1% of its profits (40 billion) on renewable energies last year, the hippy looking fellow’s job title must be “mask of responsibility”.
Now I am all for bringing sustainable practices into our lives whenever possible, though this be short of overthrowing the wild rule of capital. The ecological crisis is real, profound and well past upon us; we drift nearer the precipice every day; our ship of state rudderless, capitalism’s appetites boundless. Going over seems all but assured given the current balance of forces. We need an approach to the crisis as serious and radical as the crisis itself. As counterpoint to that seriousness this story from Ireland makes clear the bullshit associated with Madison Avenue Environmentalism.
Every year on the 12th of July (and for months surrounding that hallowed date) loyalist bigots build bonfires across the North of Ireland in celebration of defeat and subjugation of the native population as part of Britain’s conquest. Hardly a mildly unamusing throwback to a bloody conquest, these bonfires are symbolic of a continuing sectarian domination and division. They are bigoted protestations of Protestant supremacy and are so innocuous that half the nationalist population of Belfast heads to Donegal for the week. The other half bolts the shutters in hope that a petrol bomb doesn’t fly through the window from the hands of a drunken mob.
The celebrations of the Glorious Twelfth promise to get eco-friendly next year. The bonfires may be replaced by wood burning “beacons”. Sammy Wilson, loyalist bigot, of the Democratic Unionist Party says: “We do not want to undermine tradition. However, we cannot overlook the fact that they have increasingly become environmental liabilities, stacked with heavily polluting tyres and wooden pallets.” They burn effigies of Catholics on these fires, and occasionally real ones around the 12th, and the concern is the pollution from burning rubber tires? In this day and age who can afford not to seem environmentally conscious? The loyalists, after all, need their government grants.
The Twelfth is indicative of some serious social problems, to put it mildly, in the North, I would not have thought that pollution was the most important problem one would see the bonfires as representing. Perhaps we can ask the Klan to use flashlights (hand cranked of course; batteries seep all kinds of pollutants) to alight the Fiery Cross rather than environmentally damaging kerosene and tar wood next time they would like to instill a little racist terror? We, each one of us, have our part to play in saving the planet.Here I am inspecting Belfast’s bonfires for any potential environmental infringements last year. We had to cut short our visit due to the menacing crowd of unenvironmentally-friendly locals that had gathered.
The Au Sable
25 October 2008
The US financial crisis, in the context of the underlying world economic crisis, gives revolutionaries in the US an opportunity to discuss our socialist politics with many more workers and youth than we’ve been able to reach for many years. For years we’ve mainly participated in stumbling reform movements that failed to win reforms and discussed socialist politics with the few activists who cared to listen.
Now with the capitalists throwing off their neoliberal pretensions and demanding that the government bail them out, we’re able to say, “Yes, government intervention, but for the workers, not for the capitalists, and under the democratic control of the workers, not the dictatorship of capital.”
Workers are angry. For thirty years they’ve been told that there’s no money for jobs, no money for wages, no money for pensions and health insurance, no money for Social Security, Medicare and Medicaid, no money for education, and no money for infrastructure. They’ve mostly accepted the government’s spending a trillion dollars a year on past, present and future wars, since that’s for “national security.”
But now they’re being asked to accept the government’s spending trillions of dollars ($2.25 trillion paid or pledged so far) to bail out the banks, insurance companies, and other financial institutions whose speculation has gotten them into trouble. They feel lied to and cheated. Much of the middle class feels the same way. A sign held up to the Wall Street skyscrapers in a September protest of the bailout captured this sentiment with the words, “Jump, you fuckers!”
Thirty years of ratcheting up the rate of exploitation underlie this anger. Average weekly earnings for US workers peaked in 1972. Working-class and lower-middle-class families have struggled to maintain their living standards since then by having more family members work more hours for more years. Women, including the mothers of young children, men and women of retirement age, and teenagers generally have jobs, if they can get them.
The real after-tax income of working-class households has risen modestly for all but the poorest, but nearly all of the increase has been needed to compensate for the unpaid labor that family members can no longer provide. Labor productivity has continued to rise, but workers have gained little from this, as the capitalists have shifted income and wealth to themselves and their entourage.
Workers are particularly incensed because they know that the US economy is entering a recession and there will be no bailout for them. The recovery from the 2000-2001 recession was weak. Many workers laid off then, especially older and less skilled workers, couldn’t find new jobs or could find only jobs at much lower pay, often part-time or temporary.
Since then, although overall employment has risen, layoffs have continued and workers laid off or entering or reentering the workforce have often had to take low-paid, part-time or temporary jobs. Many who have kept their jobs have had to take cuts in pay and benefits. Inflation has reduced the real wages of nearly all workers. The real average hourly earnings of production and nonsupervisory workers, 80 percent of the workforce, have fallen 2 percent in the past year alone.
While the US gross domestic product continued to grow through the first half of 2008, by most other measures the US economy has already entered a recession. By the official government statistics the number of unemployed workers has increased by more than two million from a year ago. The real number is much higher, counting those who are working fewer hours than they want to work and those who have given up looking for work. Conditions will worsen as the recession deepens.
Workers have been hurt by the housing bubble and the ensuing financial turmoil. During the bubble speculators bought apartment buildings and houses and raised rents. Now many renters are being evicted as the speculators dump their properties or declare bankruptcy. During the bubble many workers paid more for houses than they could afford, thinking that their value would continue to rise. Many took adjustable rate mortgages with low down payments and low initial interest rates, thinking that their economic situation would improve enough to pay the higher rates later. Now millions of these buyers are losing their houses to foreclosures, because they can’t pay their mortgages and can’t sell their houses.
Most workers are heavily in debt with mortgages, car notes, student loans, and credit cards. While credit was easy, they could juggle loans to ensure that all got paid, although sometimes with penalties for late payment. Now they can’t get the credit they need to juggle the loans and are having to forgo not just luxuries but necessities. They no longer have the refuge of bankruptcy, since a 2005 law makes declaring bankruptcy more difficult and less protective.
Retirees with money in stocks or mutual funds have been hard hit, since the value of their assets has fallen by a third or more and they have no way to replenish them. Workers trying to save money for their children’s college education and their own retirement have been hit too.
As always, the situation of Blacks and Latinos is worse than that of whites. Blacks and Latinos have higher rates of unemployment, lower wages and income, fewer assets, and more poverty than whites. With manufacturing and government retrenching, Black and Latino workers have less access to the relatively well-paid, unionized jobs that once provided a way out of poverty. Last hired and first fired, they have less to fall back on, since the neoliberal regime of the past thirty years has shredded the social safety net. Immigrant workers are even more vulnerable, since they can’t invoke the little protection the law gives citizens and they may be forced to leave the country if they lose their jobs.
Women have been especially hurt by the deteriorating economy, since in this patriarchal society they are usually the primary caregivers, as well as wage laborers. Even in the best of times trying to hold a job or develop a career and simultaneously take care of children, partners and often parents is daunting. With the loss of jobs, wages, benefits, social welfare, and homes the demands on women can become overwhelming, especially if they have to face them alone.
Capitalism in its imperialist stage is the root cause of the economic crisis. In Imperialism: The Highest Stage of Capitalism Vladimir Lenin described imperialism in words as appropriate today as they were nearly 100 years ago when he wrote them.
But very brief definitions, although convenient, for they sum up the main points, are nevertheless inadequate, since we have to deduce from them some especially important features of the phenomenon that has to be defined. And so, without forgetting the conditional and relative value of all definitions in general, which can never embrace all the concatenations of a phenomenon in its full development, we must give a definition of imperialism that will include the following five of its basic features:
(1) the concentration of production and capital has developed to such a high stage that it has created monopolies which play a decisive role in economic life; (2) the merging of bank capital with industrial capital, and the creation, on the basis of this “finance capital”, of a financial oligarchy; (3) the export of capital as distinguished from the export of commodities acquires exceptional importance; (4) the formation of international monopolist capitalist associations which share the world among themselves, and (5) the territorial division of the whole world among the biggest capitalist powers is completed. Imperialism is capitalism at that stage of development at which the dominance of monopolies and finance capital is established; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun, in which the division of all territories of the globe among the biggest capitalist powers has been completed.
The curve of world capitalist development combines three underlying curves: a secular rise in labor productivity and production, a fifty or more year alternation of periods of relatively rapid expansion followed by periods of relative stagnation, and an eight to ten year business cycle.
In the early 1920s the Russian economist Nikolai Kondratiev first noted the fifty or more year alternation of periods of relative expansion and stagnation and wrongly described them as “long waves,” thinking they could be explained by purely economic factors analogous to those explaining the business cycle but acting over a longer period of time. Leon Trotsky rejected this purely economic understanding of the phenomenon and explained it in terms of capitalist equilibrium and disequilibrium involving not just the dynamics of capital accumulation but also the social, political and military relations among classes and among nations. Ernest Mandel and others revived Trotsky’s concept in the 1970s.
World War I through the aftermath of World War II was a period of capitalist disequilibrium marked by economic convulsion, wars and revolutions. The 1950s and 1960s were a period of capitalist equilibrium. The period saw several recessions and many struggles, including union struggles, national liberation struggles, struggles by racially and nationally oppressed groups, and struggles by women, lesbians and gay men, and youth. But these were in the context of a world economy that was expanding relatively rapidly and class and international relations defined by bourgeois democracy and the welfare state in the imperialist countries, the Cold War coexistence of Stalinism and imperialism, and the shift from colonialism to neocolonialism.
The 1970s opened a period of capitalist disequilibrium which continues today with no end in sight. Economically, capitalism had accumulated such immense productive forces that further investment on the scale of the previous twenty years wasn’t profitable enough for the capitalists to undertake it. In the 1950s and 1960s the world economy had expanded rapidly enough so that the capitalists could make massive concessions to the workers and the oppressed to buy social peace. As economic growth slowed, the capitalists shifted their strategy from investing to expand productive capacity to jacking up the rate of exploitation. Socially and politically, the demands of the workers and the oppressed collided with the capitalists’ diminished ability to make concessions and profits at the same time. The capitalists retreated through the first half of the 1970s and then, as the movements of the workers and the oppressed lost momentum, launched a counteroffensive.
The Soviet Union, although not capitalist, went through an analogous process in which its economy slowed to a point where it could no longer deliver the rising living standards that, combined with diminishing repression, had held the country together. As the Soviet Union collapsed, the Stalinist bureaucrats transformed themselves into capitalists or administrators of newly capitalist states. The Eastern European bureaucrats generally failed to transform themselves into capitalists but instead became social-democratic or nationalist politicians in capitalist states quickly drawn into the orbit of European and US imperialism. The Chinese bureaucrats, learning from these experiences, have carried out a transition to capitalism under tight party and state control. The workers in the new capitalist states, like those in the old, are exploited at a level that would have seemed impossible thirty years ago.
Workers have lost ground partly as a result of technological changes that have allowed corporations to restructure themselves at workers’ expense. Improvements in computers and telecommunications have allowed employers to replace workers with machines and to decentralize production. They no longer need the huge concentrations of workers they once needed. They can more easily shift production to other parts of the country or abroad, where unions are weaker, wages are lower, and governmental regulation is more lax. They can sell or spin off operations, subcontract, and outsource.
The technological changes and restructuring have increased labor productivity, but their main goal and effect has been to weaken the ability of workers to organize and resist, as the capitalists promote competition by playing off one group of workers against another.
Workers could have countered these developments by higher consciousness, better organization, and more militancy, as they have in the past. But they’ve been blocked by the bureaucratic leaders of the unions, the social movements, and the reformist political parties. These leaders do not want to risk their careers and social positions by leading militant struggles. They try to steer their organizations toward collaboration with the capitalists, rather than struggle, despite overwhelming evidence that collaboration leads to surrender or defeat.
In the US the Democratic Party occupies the space that a reformist workers’ party would occupy in a more politically developed country. The union and movement bureaucrats claim that backing the Democrats is the way to get the government “on the side of the people” and a prerequisite for improving the situation. The Democratic Party politicians welcome this endorsement, since without it they would have no leverage, but they take their orders from the capitalists who fund them and whose media can make or break them. Al Gore won the 2000 presidential election, initially protested George Bush’s theft of the election, and then stood down when the ruling class told him to do so “for the good of the nation.” Barack Obama was once a community organizer and a believer in Black liberation theology, but he renounced his former beliefs to get the $700 million in campaign contributions and the media blessing he needed to win the presidency.
The world capitalist economy is entering a recession. The business cycle has peaked and is turning downward. The capitalists are cutting back investment, because they have excess capacity in most industries and are able to produce far more than they can sell. They can still make killings in the bottleneck sectors of oil and other commodities, but the high prices there are mostly a drag on the rest of the economy and are coming down as the recession develops.
The workers and the lower strata of the middle class are cutting back consumption, because they have lost jobs to layoffs and income to wage cuts and inflation and have too much debt. Foreign demand for US goods and services has picked up some with increased US productivity and the falling value of the dollar, but the US still imports far more than it exports, reducing demand for US production. Government spending, mainly on war, is the economy’s last prop, but short of a world war that alone can’t hold off a recession for long.
The financial crisis dramatically underlines the problem of speculation in the current capitalist economy. Unable to make as much as they want through jacking up the rate of exploitation of workers in the real economy, the capitalists resort to financial manipulation to increase their take. Some of this is simply swindling workers or each other by fraud or enticing their victims into lending or borrowing that they would not have agreed to if they’d known the true risk. But much of it is the collective irrationality of speculation.
Looking for extraordinary short-term gains, the speculators bid up the prices of stocks, futures, derivatives and other financial instruments that are or purport to be claims on future profits. They bid the prices well above what could be justified by the profits that the real economy of production and distribution of goods and services can yield.
For a while the speculators get fabulously and fictitiously rich, because every bad investment they make they can find some other sucker to take off their hands for even more. They play musical chairs moving from one bad deal to another until the music stops. Those who are left standing go bankrupt, and the others move on to the next game. In the past ten years we’ve seen the stock market bubble that burst in 2000, the real estate bubble that burst in 2007, and the commodities bubble that is bursting now.
A sharp recession is inevitable because of massive overproduction and overaccumulation in the real economy. An obvious question is whether the financial crisis will transform the recession into a depression. We can’t know for sure, but at this point that seems unlikely.
Having learned from the disastrous stock market crash of 1929 and the contained crashes of 1987 and 2000, the capitalist governments are moving quickly to shore up the banking and insurance system by guaranteeing loans, deposits and exchanges, arranging mergers, buying risky mortgages and other bad assets, infusing capital by buying non-voting preferred stocks that give them no managerial control, and in some cases temporarily nationalizing the institution. The US government has paid or pledged $2.25 trillion so far, and the Japanese, European, Canadian and Russian governments have paid or pledged correspondingly large amounts.
At this point it seems that the outcome of the financial crisis will be a massive consolidation of the US and world financial system. In the US half a dozen banks with one to two trillion dollars in assets each will survive, linked to a network of smaller regional and local banks. Fannie Mae and Freddie Mac,the two big mortgage holders now in government conservatorship, will be returned to their stockholders, possibly broken up into more manageable pieces. The financial system will be more regulated but basically back in business.
Even if the US and world economies escape a depression, we can expect a continued ratcheting up of the rate of exploitation through the sharp recession developing now and the weak recovery that will follow. The conditions of the workers and of the lower middle class will continue to deteriorate, as the capitalists continue to shift income and wealth to themselves and the upper middle class.
The deteriorating conditions of life, the increasing social inequality, the wars in Afghanistan, Iraq and whatever country US imperialism targets next, political shocks like Hurricanes Katrina and Rita and the Sensenbrenner anti-immigrant bill, and the daily corruption, violence and injustice of capitalist society will eventual provoke a fightback. At that point all the parameters will change. Revolutionaries will participate in and lead mass struggles that could actually realize the socialist vision we propose.
Meanwhile, revolutionaries should take advantage of the moment, which may be a moment of political epiphany for the working class. Workers are angry. They feel lied to and cheated. They are also scared. In their thinking, if not yet in their action, they are more open to collective and radical solutions than they have been in many years, since the situation seems desperate and the capitalists have resorted to collective and radical solutions for themselves.
Socialists should propose solutions to the crisis on the theme, “Bail out the workers, not the bankers,” following the transitional approach of the Communist Manifesto:
This cannot be effected except by means of despotic inroads on the rights of property, and on the conditions of bourgeois production; by means of measures, therefore, which appear economically insufficient and untenable, but which, in the course of the movement, outstrip themselves, necessitate further inroads upon the old social order, and are unavoidable as a means of entirely revolutionising the mode of production.
The solutions should include:
The thousands of organized socialists and tens of thousands of unorganized socialists in the US can’t realize such a program of action or even much more modest reforms. Only the workers and the oppressed can emancipate themselves. But we can participate in struggles as they emerge and in the political discussions they provoke. By this we can contribute to building the mass revolutionary parties and other organizations the working class needs to emancipate itself.
*Peter is a member of Solidarity in Ann Arbor/Ypsilanti and veteran revolutionary activist in the Detroit area.
Here is some on the scene reporting from Atlanta by Solidarity’s Isaac Steiner…
This morning’s “funeral for justice” ended with joyful laughter and hugs as local activists celebrated the second stay of execution for Troy Davis in two months. Bearing a casket marked “JUSTICE,” human rights activists walked the rainy streets of downtown Atlanta to deliver 140,000 petitions and a letter signed by over 100 clergy members to the Georgia Parole Board. A few minutes after entering the capitol, they emerged with the good news.
Last night, October 23, nearly a thousand supporters of Troy Davis rallied on the Capitol steps, just days before his scheduled lethal injection. The rally was part of a global day of action drawing attention to the case, which has become notorious around the world. Prosecutors lack physical evidence linking Davis the the 1989 murder of a Savannah police officer, and 80% of witnesses recanted their testimony, citing harassment and pressure for a speedy conviction for the murder of Mark MacPhail. The injustice of the Davis case highlights general problems with the death penalty.
Even before the stay was announced, spirits were high and the crowd was militant. Outrage about the Troy Davis case has stirred general opposition to the death penalty and other aspects of the criminal justice system. Even more importantly, the success of the mass mobilizations has energized the beginnings of a grassroots movement. In Atlanta, the movement to save Troy Davis has reached mass proportions – on the train home from the demonstration, passengers who saw my button and “I am Troy Davis” nametag were eager to hear the latest news.
The most powerful moment of the rally was a stirring speech delivered Troy’s sister, Martina Correia. Marina has added an eight year battle with cancer to her ongoing struggle against the system that has kept her brother on death row. I recorded her speech, but several parts are inaudible becuase of cheers to the crowd, so what follows is a rough, edited transcription. Correia and Troy’s mother, Virginia, were introduced by local rapper Michael Render, aka Killer Mike. Afterwards, Laura Moye of Amnesty International delivered a phone message from Troy. (Coincidentally, today is Laura’s birthday, so the stay of execution was a nice present.)
“It is amazing to me that Troy’s name is heard around the world. Today is a global day of action for Troy Davis in more than fifteen countries around the world and more than forty cities in the United States. And not just today. This has been going on all week long. And it will continue!
They say that we are defeated. They say that we have not won. But if Troy’s name is being heard in Madagascar, we have won! If his name is heard in Finland, we have won! If Troy Davis’ name is heard in England, we have won! If Troy Davis’ name is heard in New York City, we have won! It is heard in Detroit, South Carolina, California – we have won! The name “Troy Davis” is ringing in Savannah, Georgia.
And I’m going to tell you something. The whole Chatham County courthouse is shaking. Because they know they are lying, and they are coming down. That’s why [Chatham County prosecutor] Spencer Lawton is spouting all those lies in the newspaper. They don’t have any evidence against Troy Davis! They needed a bunch of children who were afraid, and bullied for hours and hours, to say that it was Troy Davis. They used people who had criminal records and threatened them with life in prison to say it was Troy Davis. But you know what? These people stood up against against a system that was breathing down their necks and said, “No! We lied against Troy.”
That Parole Board [across the street from the Georgia Capitol] heard witness after witness tell the truth about why Troy Davis is not guilty. There’s people like Garland Hunt on the Parole Board. Garland Hunt said, “We know all Black men carry guns. We know all Black men, you know, ‘homeboys’ are criminals.” That’s what Garland Hunt said to a preacher in this community.
Every chance they get, they butcher Amnesty International. But this is not just about Amnesty. The NAACP, National Action Network, Southern Center for Human Rights, Georgians for Alternatives to the Death Penalty, citizens all over, Campaign to End the Death Penalty. We got universities out here! We got clergy out here, from all faiths. This is about people, this is about human rights.
When you say “I am Troy Davis” you better take that seriously. Because if you don’t have money, if you’re a certain color, if you’re accused of killing a certain color person – in the justice system, you could be Troy Davis. They say that the death penalty is not racist. But there are only three people on death row for killing Black people. How many Black people lose their lives, all the time? How many poor white people lose their lives all the time? And how many rich people are over there on death row? None!
The Department of Corrections is not a corrective system. It is a system of vengeance and violence and destruction.
Seven out of nine eyewitnesses! Never in the history of Georgia. Seven out of nine eyewitnesses! Never in the history of the United States. No weapon. No physical evidence. Police coercion. Prosecutor misconduct.
My brother just turned forty years old. But they are going after children – thirteen, fourteen, fifteen years old. You should see the morale of the people in that prison, of the other inmates. They know that it is wrong; if Troy can’t get justice, nobody can.