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The turn of the screw
Recession promises hard times
By Nathan Johnson
Some 300 people are living in a Hooverville, or more appropriately a “Bushville,” tent city outside of LA, the likes of which has not been seen since the Great Depression.
Take a moment right now and try to remember what life was like before this recession, because it promises to be the worst capitalist crisis since the Great Depression.
The recession is just beginning and already the economy has almost collapsed with the near bankruptcy of Bear Stearns, formerly the fifth largest bank in America, which had lost 94 percent of its value in just two days. The government mediated the sale to JPMorgan Chase for merely $10 a share, thereby guaranteeing JPMorgan Chase superprofits. So much for free competition.
To quote the Marxist Ernest Mandel, “a capitalist system left to its own economic automatism runs the risk of perishing rapidly, and increasingly the state becomes the guarantor of capitalist profit… of the ruling monopolistic layers of the bourgeoisie.”
In fact, $29 billion of taxpayer money was used as collateral to transact the deal. This market failure couldn’t be fixed through the market itself, but only through public funds, demonstrating the corporate property should be public property.
When the working class experiences hard times, does the government come to its rescue? Certainly not.
232,000 jobs were lost since the beginning of the year, 80,000 jobs last month alone. “The jobless rate rose three-tenths of a percentage point, a sharp increase usually associated with times of deep economic stress,” the New York Times reported.
The subprime mortgage crisis has incurred an astounding $400 billion in losses to banks worldwide. The value of housing has dropped 10 percent, and may easily fall another 10 percent or more.
Some 300 people are living in a Hooverville, or more appropriately a “Bushville,” tent city outside of LA, the likes of which has not been seen since the Great Depression.
Achieving record proportions, 28 million Americans - nearly 1 in 10 - is dependent on food stamps to survive. To quote the Communist Manifesto, “here it becomes evident, that the bourgeoisie is unfit any longer to be the ruling class in society, and to impose its conditions of existence upon society as an over-riding law... because it is incompetent to assure an existence to its slave within his slavery, because it cannot help letting him sink into such a state, that it has to feed him, instead of being fed by him.”
The price of oil is breaking its highest record at $106 a barrel, and is expected to continue rising through the summer.
To top it off, the Iraq war is wasting hundreds of millions of dollars every day and disillusioning the working class.
The New York Times reported that 81 percent of Americans believe the United States is headed down the “wrong track.” It’s amazing that figure is taken from just the beginning of the recession - before the hurricane has even reached land.
Everybody knows about the business cycle- how the capitalist economy always fluctuates from expansion to recession and back to expansion only to be followed by another recession, and so on. However, there also exists a larger business cycle typically spanning 20 to 25 years, known as “long waves.”
One long wave of capitalist growth is followed by a long wave of contracted expansion. However, the capitalist system does not recover to another long wave of growth automatically, but rather relies on a system shock of some kind. For example, the 1874-93 long wave of recession was ended by unconscionable, racist imperialism, the 1914-1939 long wave by World War Two, and the 1968-1990 long wave by the fall of the USSR and greater capitalist inroads into China.
There are still periods of growth in long waves of recession, and recessions in long waves of growth. However, there is qualitatively less growth in a long wave of contracted growth, and qualitatively more growth in a long wave of expansion.
The severity of the current recession indicates that we are in the beginning of a long wave of contracted growth. What’s novel about this long wave is that it makes the long wave of capitalist expansion before it the shortest wave of its kind, lasting only 17 years, whereas previous long waves of growth have lasted between 19 and nearly 27 years.
Capitalism is entering a new period of crisis. Keynesian economics are proving less and less effective. Corporate exploitation is becoming more and more transparent. The structural inadequacy of capitalism cannot be reformed away. It’s time to liquidate the broken system!
As Leon Trotsky wrote, “revolutions are nothing but the final blow and coup de grâce given to a paralytic.”
> Comments
Terrence on Apr 21, 2008 at 11:07 AM:
"It’s time to liquidate the broken system!"
The 'system' includes many property owners. I don't think their going to be happy with their stuff being taken away. Your probably going to have to end up liquidating them as well to get their stuff from them.
"232,000 jobs were lost since the beginning of the year, 80,000 jobs last month alone."
Yet our capitalist system is still has MUCH lower unemployment than socialist Europe.
"However, the capitalist system does not recover to another long wave of growth automatically, but rather relies on a system shock of some kind."
Well then 'shock' it artificially with a command economy.
Are you or anyone you know destitute? This isn't the 1930's. Just because the economy is in a slump doesn't mean we should destroy the whole system and replace it with something worse.
Terrence on Apr 21, 2008 at 12:47 PM:
"Everybody knows about the business cycle- how the capitalist economy always fluctuates from expansion to recession and back to expansion only to be followed by another recession, and so on."
The economy ebbs and flows, but that doesn't mean it doesn't work. If people are poor enough the people on top can't sell anything and subsequently wages rise again. That's a natural cycle. It doesn't mean anything is broken.
Look stealing is wrong no matter who is doing it. Fascist neocons let corporations steal from people because they're trying to compete with communist leftists like yourself who also advocate theft. By advocating for communism your only escalating fascism.
Adam on Apr 21, 2008 at 04:42 PM:
There are still some communist countries out there. I suggest you move to one.
Nathan Johnson on Apr 21, 2008 at 06:31 PM:
Adam,
Tell me- where is there a classless society, because I would gladly move there. You are mistaking Stalinism (or post-Stalinism) for communism.
Johanan Raatz on Apr 22, 2008 at 07:55 PM:
"Tell me- where is there a classless society, because I would gladly move there. You are mistaking Stalinism (or post-Stalinism) for communism."
Unless you try your "non-profit socialism" idea and completely keep it out of the political sphere, communism will strucuturally lead to Stalinism. It's unavoidable. That said the idea you presented to me a while back seemed to keep the political sphere alone. Now I'm not sure it could be classified as 'communism' properly, but if you want higher wages thats how to do it. You can compete against it with your unionism or syndicalism and that is completely fair but people have a right to try to get rich and that shouldn't be prevented by the state. If it is then it starts to converge on Stalinism. Stick with your original idea.
Nathan Johnson on Apr 22, 2008 at 08:44 PM:
Guy Debord
The spectacle presents itself as a vast inaccessible reality that can never be questioned. Its sole message is: “What appears is good; what is good appears.” The passive acceptance it demands is already effectively imposed by its monopoly of appearances, its manner of appearing without allowing any reply.
The spectacle presents itself simultaneously as all of society, as part of society, and as instrument of unification. As a part of society it is specifically the sector which concentrates all gazing and all consciousness. Due to the very fact that this sector is separate, it is the common ground of the deceived gaze and of false consciousness, and the unification it achieves is nothing but an official language of generalized separation.
Johanan Raatz on Apr 23, 2008 at 11:26 AM:
Nathan;
"The spectacle presents itself as a vast inaccessible reality that can never be questioned."
In order to be question you need to have a basis for the questioning. This basis comes from common sense and a priori reasoning. The 'spectacle' he is reffering to can't be questioned because questions pertaining to it are meaningless. You can't logically formulate a question that has no basis. The can't logically question the grounds of valid questioning without your position becoming invalid.
"Its sole message is: “What appears is good; what is good appears.”"
No, reasons are provided. The trouble with many Marxist theorists is that they say that these reasons are themselves false consciousness. The thing I have noticed about this is that it usually doesn't even matter what the reasons are, all the Marxist theorists who do this care about are the conclusions of these reasons. They don't like them and so no reason is good enough for them. That's a logical fallacy known as petitio principii or "begging the question."
By arguing that the grounds of objectivity are false Guy Debord is being illogical. If class consciousness undermines the grounds of objectivity then class consciousness is clearly false consciousness as it has therefore no claim to being objectively true.
"Due to the very fact that this sector is separate, it is the common ground of the deceived gaze and of false consciousness,"
This where the vast majority of Marxists go wrong. The political sphere is designed to provide for the grounds of fairness. By saying that it is illegitimate these theorists are merely undermining their own legitimacy as well as the rule of law. When you undermine the rule of law then people like Pinochet are logically necessitated. Without respect for the law people don't obey it as much without more authoritarianism in government. So when Marxists do this they are undermining their cause as the result is much worse for them.
Now yes the political sphere can be unjust but that is when it is used unjustly. Now yes corporations and capitalists can abuse it in this fashion however frequently Marxists try to do so as well. It would be unjust to place Marxism in the political sphere as it would undermine people's rights to private property. The political sphere is supposed to protect the property rights of everyone regardless of class. Marxism that disrespects people's rights is Stalinism.
I'd warn against disproportionately basing your arguments on Marxist theorists like these. If you use fallacious frames for your arguments you are likely to reach fallacious conclusions. Now that doesn't mean they don't have anything interesting to say but they have to be taken at a grain of salt.
What I liked about you originally was that your idea respected the rule of law and respected people's rights to private property. Stick with your original idea. Mixing politics and communism is a bad idea and automatically leads to Stalinism.