SPRING TURNS TO AUTUMN.

Posted on September 15, 2012 by stutteringsteps

Can it really be surprising that the Arab Spring has turned into an Anti-west Autumn? Are the recent violent attacks on US and European Embassies and their staff, along with assorted western commercial targets, really something that was provoked by a largely unseen film? Alternatively were these attacks merely events which only needed an opportunity to occur and an appropriate trigger? I suggest the latter. The recent overthrow of despotic regimes in the Middle East and North Africa has provided the opportunity, the internet publication of the recent anti-Islam film has provided the most recent trigger.

Anyone who has critically observed the West’s interventions, in the Middle East and elsewhere, over a number of years, will hardly be surprised, that the West‘s consistent violence will be reflected back upon them at any opportunity. The support for numerous puppet regimes, the funding of Israel‘s war against the Palestinian‘s, the illegal war in Afghanistan and Iraq, the indiscriminate bombing of Libya along with countless targeted (and mis-targeted) drone assassinations in Pakistan, Yemen and elsewhere, has built up a massive reservoir of resentment in many lands.

During the Arab Spring this long-suppressed, smouldering anger and resentment was focussed upon the military-supplied regimes in the middle east. They were regimes who kept their citizens in check and supported the West’s negative economic, financial, political and military interventions throughout the region. The chosen ideological framework of the aggressive penetration by the west’s capitalist inspired economic interests has been by ideas of secular liberal democracy, but importantly, it’s economic and political interests are led by practicing Christians.

It can hardly be surprising that those who are strongly opposed to the West’s oppression and exploitation are also obliged to use the most appropriate ideological constructs that are available to them. What set of ideas are available to them? Since the historical betrayal of anti-capitalist ideas perpetrated by the Stalinists, it is not surprising that the ideological construct directed against the 20th and 21st century imperialist-style onslaught of the Christian-led capitalist West, now frequently orbits around the ideology of Islam.

For this reason the activist vanguard of those opposed to western intrusion and hegemony in the Middle East, North Africa, are often those most closely associated with Islam. But not always and not for ever. This Islamic leadership role, where it emerges, has been further gifted to the Islamists, by the aggressive, exploitative antics of the West along with its Imperial, racist heritage and its contemporary institutionalised development. A further twist endorsing this outcome has been an inconsistent and self-serving response by the pro-capitalist political elite to the phenomena of religion.

At one level in the West, there has been an accommodation to patriarchal religious ideology (particularly with regard to questions of female subordination) where this has furthered the elite’s economic and political interests. At another level there has been a surreptitious and proxy attack upon foreign labour disguised as a form of intolerance to their religious or cultural norms. This accommodation to patriarchal religious governance, has served to strengthen the status of religious activist leaders and by the same measure weakened the alternative status of secular activists among these communities.

It is also predictable, that the American political and economic elite will be in complete denial concerning the fundamental opposition to the West’s foreign polices. Accordingly, they have fixed the blame upon the publication of the film and will continue to do so. Their focus in negotiating any future outcomes will therefore be on the religious issue and in this way will play into the hands of religious extremists. However, it should be understood that the anger and violent opposition to the west within many Arab countries, is not entirely about religion, even if for some Islamists this is completely the case.

A great deal of the opposition, is to the economic and social conditions resulting from the hegemony of western militarised Capitalism. The original catalyst for Arab Spring Uprisings in Tunisia, Egypt and elsewhere, was the poverty, unemployment and lack of political freedoms delivered by the West‘s puppet regimes. Despite any collusion with the West’s elite’s, these economic and social issues are of such magnitude that the Islamist leaders and other religious elites cannot solve them. At root, they are essentially the same issues which the pro-capitalists of the West also cannot solve. The class tensions, partly masked in the east by religious ideology, will sooner or later re-emerge as they are doing here in the west with the increasing breakdown and unmasking of consensus politics.

The various Middle East uprisings and now anti-West retaliation, distressing and confusing as they are, are also indicators that epoch of the West’s neo-liberal domination of the world is coming to an agonising end. The post-Second-World-War, Anglo-Saxon empire is gradually crumbling at the edges. Like the earlier decline and fall of the Roman Empire and that of the later British Empire, this unfolding fragmentation and dislocation is taking place at its periphery and will continue to do so for a further period.

Meanwhile, at the core of the West’s inter-connected heartlands lies a massive economic and financial crisis, which is also causing similar problems of unemployment, poverty and social unrest to those in the East. This same crisis is simultaneously undermining the economic strength of the political and financial elite in the US and Europe. Already the elite in many European capitalist countries are faced with handing over effective economic and political sovereignty of their countries to the IMF and World Bank in exchange for financial bailouts. Irrespective of any potential radical political changes in the US and Europe, this developing economic crisis will progressively limit the ability of the elite to impose their will upon those in former colonised and subjected countries.

Nevertheless, a further burst of militarised response interventions by the US and the West elites, is to be expected. Relatively low-cost drones will be part of this response, but all such responses will exacerbate their problems and increase the opposition to them in former subjugated countries. The capitalist West has just done far too much harm and continues to do so, for this to be forgotten or forgiven by the peoples of subjected nations. Only an alternative socio-economic system in the West, could invite peace and reconciliation with the rest of the world‘s ordinary people – including those in the now volatile East.

Until then, the anti-capitalist left position should of course be solidarity with struggles against the West’s interventions and impositions, but solidarity combined with a resolute critical dimension. It should be a critical dimension which refuses to accept (and campaigns against) cultural or religious traditions which oppress, women, disabled, gay and promote other forms of discrimination. If for many individuals, religion is still ‘the opium of the people‘, then we should argue and campaign for them to cease using this drug of choice, whilst campaigning for real changes in their circumstances which presently engender, or require, such an opiate.

Roy Ratcliffe (September 2012.)

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WHAT TRIGGERED THE CRISIS?

Posted on September 10, 2012 by stutteringsteps

It is generally recognised that there is an ongoing economic crisis taking place within the 21st century capitalist system. However, its causes and what has triggered it – which are not necessarily the same – are the subject of considerable dispute. This dispute takes place not only within the pro-capitalist camp but also within the anti-capitalist ranks. The pro-capitalists, viewing as they do, the capitalist system as the most advanced and desirable system, rarely if ever delve below the ’appearances’ of the economic categories of their system. They try to make sense of it and suggest remedies based upon these surfaces appearances. From the standpoint of anti-capitalism, however, it is important to understand the underlying phenomena which gives rise to these appearances and recognise the complexity involved. The following is a contribution to such an understanding.

Belief in economic appearances are the economic equivalent of the everyday fact that from our various places upon the planet it ‘appears’ that the sun goes round the earth, when in fact it is the opposite. This fact did not prevent the vast majority of people ‘believing’ that this was so for thousands of years, despite it being challenged, particularly by Copernicus and later observers of celestial reality. In delving beneath appearances, Marx, did for economics, what these early mathematicians and observers had done for astronomical and other sciences. Marx formulated the general possibility of capitalist crisis as emanating from the separation in time and space between purchase and sale of commodities. This together with the pursuit of profit leading to relative over-production (producing more than could be sold at a profit) could compound the general possibility and turn a limited crisis into a general one.

During the 20th century such a period of relative over-production, was off-set to some degree by the extension of multiple forms of credit. Indeed, such an off-setting, extended credit factor itself, can create an over-production of credit along with the increased possibility of defaults. This occurred roughly during the period of 1970 – 2000. In many ways the relative over-production of commodities and thus the overproduction of productive capital was revealed in Europe when wine lakes, butter mountains and set aside agrarian policies were brought to popular notice. Such EEC measures where not taken because all these commodities and future land-produced commodities, could be sold on the open market at their value and the capital invested realised, but the opposite. They were purchased and stockpiled (or dumped) because the capital (and thus surplus labour) locked up in them, could not be realised without government intervention, utilising borrowing and tax revenue to purchase them.

At this point it should be obvious, as in other walks of life, that due to complexity, the immediate trigger releasing an acute crisis may not always occur at the point were the crisis is maturing, but at a weaker connected juncture. And the system of capitalist production has many such junctures. The circulation process of capital, requires many intermediate stages between initial purchase of raw materials, means of production, the production, distribution and sale of the finished commodities. Between each of these numerous phases, money or credit or a combination of the two, must link all the elements of production and circulation.

What is true of each particular industrial or commercial factory, is also true at a national and international level. The whole system of modern capitalism requires a complex international interconnection and continuous reliable production, transportation and consumption process. A significant or substantial breakdown in any one of the linked but separate stages or between stages can trigger or be triggered by a particular crisis and in certain circumstances – subsequently develop into a general crisis. The following are just a number of the more probable locations for such possibilities of crisis emerging and re-emerging.

1. Significant quantities of commodities remaining unsold.

Relative over-production. This could occur for any number of reasons – saturation of the market, downturns in consumer spending, collapses in currency – but any such significant relative over-production of commodities, would result in the failure of money capital to return to the producer. Depending upon the financial reserves held by the producer (or availability of sufficient credit) this could in turn lead to failure to pay for further materials or labour, leading to cancellation of orders and sacking of workers. Any such failure in one place could pass down the line of suppliers and producers causing multiple failures there also.

2. Non-fulfilment of payments.

Defaults. This could occur for the above noted reasons, but also because of swindles, thefts, speculative purchases, miscalculations, a down-grading or lack of credit, increased costs of credit, a rise in the costs of materials or labour etc. Again any such significant occurrence in one company or industry could have a knock-on effect on others along the full length of the chain of supply, distribution and consumption. Each one relying, sooner or later, on receiving payments in order to pay their creditors.

3. Unavailability of credit.

Credit squeeze. The complexity and diversity of the modern system of capitalism requires an extensive credit system. Credit avoids, any interruptions in the process of production and consumption, caused by delays in the realisation of surplus value or an insufficient supply of interest bearing capital. Credit itself could dry up or be refused, not because of any problems with production or distribution of commodities, but because of problems or changes occurring in the credit granting institutions. Crises in this realm of capitalism can react upon the essential production processes and cause a crisis. Because any such refusal in one place could have a domino effect on the payments and transactions of industrial or commercial businesses.

4. Speculative bubbles and collapses.

Leveraged and fictitious capital. An extensive credit system and the supply of surplus value in the form of interest bearing capital, leads to the creation of ‘leverage’ and fictitious capital. Speculative surges of money capital seeking interest on its investments in favourable avenues, can create bubbles of activity in one sphere of activity, leading to shortages of money capital available for general productive activity. Such bubbles can accelerate the creation of fictitious capital (paper ‘financial instruments’ and after distorting the cost of credit and the replenishment of productive capital, the bubble can suddenly burst. A bursting bubble, as was seen by the housing sub-prime bubble which collapsed in the USA in 2008, leads to a contraction and dislocation of credit and banking solvency. This in turn can lead to a crisis elsewhere in the system.

5. Interrupted material supplies.

Exhausted resources. It is obvious that supplies of materials can be interrupted for any number of reasons, including being triggered by any of the above four reasons and those to follow. However, materials supply can be interrupted by circumstances outside of the production or circulation processes, such as wars, disasters, and increasingly exhausted primary sources (mines, forests, wells, seas etc.). Also an interruption could occur due to reduction in the quality of materials. Such interruptions can trigger a production crisis in which commodities can no longer be produced or produced in the same qualities, quantities or at the same price. For example a crisis in the supply in the pivotal energy producing material of crude oil or refined petrol would cause a general crisis of production in all spheres of life.

6. Labour withdrawal or insufficiencies. 

Strikes or occupations. Since labour is an essential requirement for all kinds of production, an insufficiency of labour, for any reason, can cause an interruption to production even if all the other factors needed for production are available and in the places were they are required. Labour is the necessary ‘active’ value-increasing ingredient in production as all other values are consumed by the activity of labour during production and become embedded or embodied in the final product. Labour-withdrawals in the form of strikes, sit-ins and work-to-rules, interrupt the production processes and delay the circulation of capital as well as possibly cause the deterioration of other elements of production. Industry-wide strikes can cause a series of crises, which ripple outward. A general strike is more likely to occur as the result of a general crisis, but it to can accentuate such a crisis.

7. Transportation interruptions or failures. 

Infrastructure collapse or denial. Since the circuit of productive capital requires completion between the initial investment for purchase of means of production, the production process itself, and the subsequent marketing and sale of the final products, transport becomes vital. With the development of global economic interactions there are numerous parts to the transport of; raw materials, means of production, and delivery to markets. Any serious or long-lasting interruptions to these phases of transport can cause a crisis within a factory, an industry or even in certain circumstances an entire country. Indeed, in the Second World War one of the major means employed by both sides to bring an industry or country to its knees, was to deny each other the means of transport of essential supplies of consumer goods, raw material goods and means of production.

8. Government economic contractions or failures.

Sovereign debt. The state, under the system of capital, is a multiple tool for the capitalist and pro-capitalist elites. It is the Swiss Army Knife of social control and support for the capitalist system in general. The state is used for producing things considered necessary or desirable, but are not immediately profitable for the individual or collective forms of capital. In some periods it is also used for producing things for which the combined investment of private capital is insufficient – a modern Army, Navy and Air force, for example. Governmental purchases are often the way certain capitalist concerns are guaranteed high returns on invested capital.

Many modern governments have also become insurers and assurors of welfare benefits, employing large numbers of workers, whose wages and salaries purchase commodities and services. Additionally, the state is also the instrument for holding down the population, should large numbers or a majority of the population want to challenge the existing mode of production or instigate changes detrimental to the rule of capital. Government failures in any of these aspects, particularly in the early 21st century, those attached to the honouring of interest payments and capital repayments obtained from the international bond-markets, can cause repercussions and crises within the system as a whole.

All these eight broad categories and their own numerous internal possibilities of disconnection, interruption or failure can trigger a crisis or series of crises. These in turn can create an actual domino effect on other elements which are separated in time and space, but are necessary parts of the ‘unity’ of the whole mode of production based upon the circulation and augmentation of capital. Due to the complexity this interdependence; “Effects in their turn become causes.” as Marx pointed out in Capital Volume 1.

For this reason, under certain circumstances, a particular crisis or a sequence of particular crises can trigger a general crisis. It may not always be clear which caused which. However, it is clear that the bursting of the speculative housing bubble in the US and elsewhere, triggered a crisis of credit in the banking system in 2008. This in turn reacted upon the production processes within capitalist industry and commerce. It is also clear that building up over a number of years, a sovereign debt crisis was brewing and this surfaced in 2011 and 2012.

It is clear that crises have occurred and are occurring in all but three of the above aspects of the capitalist mode of production. Only 5 (interrupted material supplies), 6, (insufficient labour) and transportation (infrastructure problems) have been devoid of serious problems so far. Crises in the areas of relative over-production (1), speculation (4) and sovereign debt (8) are still unresolved and Defaults (2) as well as Credit squeeze (3) are as yet only partly resolved. All this means that the probabilities of any further serious problems in any of these areas will possibly trigger a full-blown general crisis, such as last occurred in 1920 – 1930‘s. Of course there can be no absolute certainty of any such general collapse, but should one occur it is highly probable that it will be triggered by a further serious dislocation or dislocations in one (or more) of the above areas.

In advance of this, however, is the question of the response of the 99% to the measures currently being implemented by the elite in an attempt to save the system from itself. Clearly a sustained general strike in any country, will cause serious disruptions to production and reproduction in the economic cycle and will undoubtedly introduce a political dimension into the economic, financial and social upheavals. Any such developments will face those engaged in a struggle to maintain decent living standards, with the choice of going beyond capitalism or resigning themselves to the fate dished out to them. Revolutionary anti-capitalists, it goes without saying will continue to argue to go beyond. To what, remains a separate question and is considered in other articles. [See for example; ’The Riddle of History Solved’; ‘Capital and Crisis’ and ’Marxists against Marx’]

Roy Ratcliffe (September 2012)

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“PROTECTING THE DREAM!”

Posted on August 31, 2012 by stutteringsteps

Mitt Romney uttered the above three words at the recent Republican Convention in the USA. The race for the Presidency is now officially on and every negative tactic that billions of dollars can buy will be used by both sides to promote their particular interests. However, in referencing the ‘magical’ American Dream, which he advocated should be ‘protected at all costs’, Romney unwittingly highlighted an essential feature of capitalist and pro-capitalist politicians on all sides of the political spectrum. The promotion of ‘Over the Rainbow‘ ‘dreams‘, or a particular American version of such ‘dream’s’ in the case of the US, is necessary under capitalism. This is because, for the vast majority of people, their reality has been and is increasingly becoming a nightmare.

Dreams encountered naturally whilst sleeping, whether good or bad, are soon over, but the type of dreams peddled by politicians such as Romney, need to be continuous. Such dreams are maintained by constantly promoted and skilfully manipulated illusions. Like their professional stage-illusionist counterparts, politicians learn the art of manufacturing deception by elaborate rituals and distracting attention away from what they are really doing, particularly while the spotlight is upon them. The congressional and parliamentary ‘stages‘, and other such electioneering platforms on which they collectively practice their well rehearsed rhetoric and histrionic posturing, are there for fooling people into believing they are trying to help those who vote for them.

Like anyone else faced with even a slightly convincing performance, we can if we choose, suspend our disbelief and enjoy the show as do the highly selected and willing audiences at the Republican and Democratic Conventions. It also helps of course, if enough people outside of such cabaret style entertainment ‘experiences’ can be rendered gullible or sufficiently self-deluded, that they too will promote the necessary political illusions. It is the illusions which become in turn a self-delusion that formal politics is the solution to life’s problems and not part of its many problems. Illusions, delusions, and dreams are as much essential products of the bourgeois mode of production as ‘smart-phones, smart-bombs, baton’s and killer drones.

a) Illusions in politics.

So one of the first illusions the political class and its supporters, sows amongst its electorate is that they are in politics for the general good. In fact they are all, without exception, in it for their own self-advancement. Even those who consistently try to do good things for others – a very, very small minority – are simultaneously in it for their own prestige and betterment. The vast majority, on the other hand, are cynical manipulators and greedy appropriators of any money, perks or privileges, they can vacuum into their bank accounts. This illusion of ‘general good’ should have been shattered as the lived reality of the past fifty years in every country of the world, has been revealed so starkly. In not one country, have politicians improved things for their citizens. Any improvements achieved, have invariably been initiated, struggled for and sustained by the citizens themselves – often forced upon reluctant politicians. And in many aspects of life, things have got a great deal worse.

The third illusion emanating from the political class and their paid sycophants is the illusion that they can have an independent effect upon the economic activity of the country they appear to administer. This is a most successful past illusion and has entered the consciousness of most non-sceptical people. This illusion is most strongly held by the older generation, the younger generations being increasingly sceptical – all to the good!. The fact is that under the capitalist mode of production, economic activity, is under the direct control of the owners and controllers of financial and productive capital and the respective means of production. The politicians themselves are at best under the indirect (at worst the direct) control of the economic and financial elite, rather than the opposite.

This much has also been made clear again in recent years and months by how governments (and their politicians) have to toe the lines drawn up by the bond-markets, rating agencies and by the numerous un-punished frauds and thefts by big business and big finance. It is a fact – again exposed in the 21st century – that an ordinary citizen stealing something petty such as a bottle of water (firewood in the 19th) will result in a fine and even a prison sentence, yet whilst stealing billions by the economic and financial elite, will be overlooked or nullified by a measly out of court settlement, before business is allowed to continue as before.

b) Illusions in Capitalism.

The current crisis of capitalism, with its multiple aspects, economic, financial, social, political and ecological, has not yet entirely removed the illusions promoted by those who gain from the present system. [see the ‘Five-fold crisis of capitalism’] In defence against the rising criticism of the obscene levels of wealth accumulated by the 1% along with their tax avoidance, a particularly virulent illusion is currently being sustained. It usually takes the form of we need the rich (so don’t tax them highly or scare them away) for they are the ‘wealth creators’. This is utter self-interested and self-deluded nonsense. The rich don’t create any wealth, they, like their politician friends, just use their elite and privileged positions to vacuum up the wealth created by others.

It may ‘appear’ that wealth is created by investments, but it is not. In many cases monetary wealth is obtained by dodgy speculation, in such forms as futures, derivatives and hedge funds. The Wall Street and City of London, promoters of this form of speculation do not create any wealth. All they produce is pieces of paper, which entitle them to cash-in for any accrued benefits, when they choose to. Their monetary gains are not creations of new wealth, but derive from someone else’s losses. Real wealth is created by people working on materials, using tools and other means of production to produce articles which are necessary and/or satisfying. The factories, workshops, machines and raw materials which produce essential and luxury items are created by working people and are staffed by working people who daily create new wealth. Without this continuous activity everything would just grind to a halt – including the usefulness of pieces of paper, bearing a government stamp – ie fiat currency.

If we delve further into the reality of the capitalist system, even the vast sums of money used to purchase those factories, machines and raw materials was accumulated out of the surplus products and value, produced by present and previous generations of working people. Pieces of paper and entries in legers do not produce anything except dust and (prior to computers), mental fatigue. The swollen bank accounts of the rich would be useless if there were not things to buy and things to eat – produced by whom? The answer is glaringly obvious if you stop to think about it. The factories, shops and offices, would not have even been built if there were not workers constructing them. When built these premises and mechanised contents would be life-less, useless, piles of glass and concrete containing equally life-less unproductive machinery, without working people operating and maintaining them to produce what we need and what we would like.

Another illusion spun out of the flimsiest intellectual sycophantic fantasies is that capitalist wealth trickles down so that everyone gets a share. This illusion should now be in the process of being cast aside, because it is obvious that wealth actually defies the analogy of gravity in this upside down capitalist world and gushes up to the rich, from the ranks of those who create it in the bottom sections of society. Wealth is clearly not created from the top down, but from the bottom up. Over the last fifty years, this fact should have become abundantly clear. The rich have got richer and the poor have got poorer. How could it be anything other than this in a system in which real wealth is created by those who produce actual tangible products, yet the vast amounts of vouchers of entitlement (paper money or digitised bank accounts) to these products are deviously amassed by the 1%?

A number of other illusions promoted by the supporters of the capitalist system are now being progressively exploded. The illusion that justice under capitalism is neutral and freely open to all. It would be an amazing contradiction if a system based upon economic exploitation could spawn anything but a legal system in which wealth and privilege did not distort any sense of fair play and recompense for wrong doing. The legal system and the justice based upon it mirrors in many ways the economic system; it is corrupt, self-serving and elitist. Whoever, pays most to its legal advocates, ensures the best possible outcome for themselves, and it is the rich who can pay the most. The poor are increasingly barred from seeking a remedy against injustice, by lack of funds.

The same goes for equal rights. A system in which there is no economic equality, could hardly evolve equality with regard to gender, race, class, sexual orientation or disability. The two centuries old struggle for equal human rights, under the capitalist system has consequently hardly dented the white-male privileges which dominated its metamorphosis, from the pre-capitalist feudal period. It continues to maintain its current strangle-hold. An occasional black or female politician or capitalist entering the ranks of the elite, does not create equality, but it does serve to create an illusion of its possibility. Yet the reality is, despite heroic efforts by generations of dedicated activists, the systems fundamental inequality still permeates all aspects of capitalist economic, social, religious and political life.

One further capitalist promoted illusion is about to be shattered as the crisis deepens. It is the illusion, based upon a short post-second-world-war reality of an entitlement to welfare provision. Capitalism, it was then suggested, had learnt its lessons from the savage treatment of 1920’s and 1930’s working people. Threatened by the example of attempted anti-capitalist revolutions, the political elite of the time decided it would institute universal forms of welfare provision. Full employment, free education, health, social services, pensions and unemployment benefit, would be pitched at such levels that would allow a dignified existence for all. The scourge of unemployment, poverty, and the stain of ill-health and ignorance would be removed from the fabric of capitalist social life.

Well guess what? Unemployment, poverty and ill-health is back with a vengeance. The capitalists and pro-capitalists, having amassed obscene levels of wealth have also discovered it is too expensive under their system to continue to deliver such promised entitlements to those who managed to attain them. Instead of improved welfare provision re-directed from the hugely increased accumulation of general wealth they have decided enough is enough, or rather what they previously thought was enough they now think is too much. Austerity is now the new nightmare facing the working class and the poor – the short-lived post-war reality is over. The bourgeois dream is dead! However, the dream – now projected into an imagined future – as Mitt Romney so clearly acknowledged, needs to be protected – and protected – at all costs! The system as it starts to implode – needs it!

So forget the past, forget the present and look into the future through the jaundiced eyes of the pro-capitalist elite is the newly emerging political mantra. We are invited to suspend our critical faculties and enter the virtual reality of an imaginary post-crisis capitalism which – predicated on economic growth – will once more deliver our dreams. Forget that it was the previous capitalist growth that created the present economic and financial crisis. Forget, that the past and present economic growth under the capitalist mode of production is already damaging the planet and that any future growth will make this damage permanent. Forget everything and just sleepwalk into the impending collapse, valiantly ’protecting the dream’ – at all costs.

‘Somewhere over the rainbow’ or ‘Follow the Yellow brick road’ may be a bit too obvious for Mitt Romney and Ryan, Obama, or Clegg,  Cameron and Miliband, or even Hollande, Monti, Merkel and others in the political elite. However, rest assured, these aspiring political Wizards of Oz, have all prepared a selection of ‘pre-election lullabies for soothing us to sleep – perchance to dream. Not to mention having prepared an army of robo-cops for those of us who refuse to accept their practiced sincere insincerity or follow them to the ends of the capitalist rainbow – in search of our individual fantasy pot of gold.

Alternatively, we can wake up to reality, cast off the spell, refuse to simply ‘wish upon a star’, and reject the illusory castles in the air. We can exit the hall of mirrors, and continue to create our own grass roots reality. Another world is possible, but only if we disown the capitalist dream, see through the bourgeois illusions and work together in anti-capitalist solidarity movements of all kinds. Yet it is even here that sadly we may encounter others who wish to ‘protect a past dream’ and its associated illusions. Sectarian anti-capitalism is based upon a different set of wishful thinking and the promotion of various illusions necessary for its acceptance. These too need to be duly jettisoned. In some places, anti-capitalist sectarian dogma continues to be used to divide us and to attempt to implant other forms of mirrored, virtual-realities which allegedly – also for our own good – recreates reliance on yet another set of political elites. This is yet another fantasy game of shadows which should not be protected, but rejected and replaced by collective, self-organised, sombre reality.

Roy Ratcliffe. (September 2012.)

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ASSANGE AND ASYLUM. WHAT’S NEXT?

Posted on August 19, 2012 by stutteringsteps

Whatever the current upfront technical or legal wrangle pivots around, (sexual accusations, bail infringements, etc.), everyone knows that the real issue is that Julian Assange provided a showcase for exposing the secret machinations of the economic, political and financial capitalist elite. The real substantive wrong-doing of Assange – in the eyes of the US and UK establishment – is not in transgressing the rights of females within relationships, nor their rights to chose who and when to partner with. They overwhelmingly ignore these rights when it suits them. Assange’s real crime is in providing a secure publishing organization for whistle-blowers. Their capitalist system is economically, financially and morally approaching a series of end-game crisis points. They will do everything in their power, to prevent full transparency of what they are up to.

The capitalist and pro-capitalist elite are eminently capable of paying someone to lie or fabricate charges against someone they don’t like, in order to get their hands on them. This has been done in the past and will continue to be done in the future. The real reason that the US and the UK have not provided emphatic guarantees, that they will not pursue extradition, is because that is exactly what they wish to do. Perhaps that is also why the Swedish authorities have refused to interview him in the Ecuadorian embassy. The ruthlessness the US intend to pursue has been demonstrated by the case of Bradley Manning and his degrading incarceration. It is also demonstrated by the antics the US and UK have previously got up to with regard to Guantanamo Bay and numerous extraordinary renditions, leading to torture and death.

A death sentence, is a highly unlikely punishment for Assange, even though right-wing US politicians have openly called for such penalty, but incarceration and harsh treatment certainly is. One also only need recall, how the close allies of the US elite in Israel (who routinely work together in such matters), dealt with the atomic bomb whistle-blower Mordechai Vanunu. They pursued him relentlessly using all kinds of misinformation and intrigue, including being trapped by using the intimate sexual attractions of a female secret service operative. Those in power and privilege will go to any lengths to prevent or silence those who in any way, small or large, threatens to expose the nature of their continued rule.

The granting of asylum by Ecuador to Julian Assange, ramps up the diplomatic tensions around this issue. Clearly those currently in power in Ecuador, who themselves (as with other Latin American countries) suffer from the devious and subversive machinations of the US capitalists and state forces, have some sympathy with Assange‘s project to expose the US. How far, this sympathy will extend is as yet unknown and remains to be seen. They could of course, grant him Ecuadorian citizenship, in some way and even appoint him later to some diplomatic status. He could perhaps be elected in absentia to a parliamentary position in a supportive Ecuadorian community.

They could perhaps even consider employing or appointing him as a junior minister of information, in the Ecuador government. Alternatively, the UK government’s actions and threats, in particular, could be challenged in the human rights courts. Any tactics such as these would increasingly create problems for the UK and the US. However, the repercussions which the vindictive elites in these latter two countries would go to, perhaps make such actions unlikely. It would be a very courageous – and game-changing outcome – if such strategies were adopted by Ecuador. Meanwhile it is to be hoped that whatever the outcome, other internet activists can replicate what WikiLeaks pioneered and continue to provide an avenue for those people who are horrified, sickened, or both at what the economic, political and financial elite perpetrate against their fellow citizens, yet strive to keep secret.

Roy Ratcliffe (August 2012)

PS.

The issue of Julian Assange, and the publicity around the granting of asylum by Ecuador,  has sparked off a high intensity debate among some sections of the left.  There are those who are vehemently for his extradition to Sweden and those equally adamant that he should not. It has split the left in a most debilitating and destructive way. Most of the opinions, for that is all many of them are, concern the allegations made in Sweden by two former sexual partners.  I do not know whether there is substance in the variously (and conflicting) reported allegations or not, but I do know prejudice when I read it.

For white prejudice, it is enough for a black person to be accused of crime, for guilt to be assumed.  For homophobic prejudice, it is enough for a gay person to be accused of immorality, for guilt to be assumed. It is enough for religious prejudice, to assume, without evidence, that an atheist lacks morals.  For male chauvinists, it is enough for a female  to be  declared irrational, for it to be considered true. For radical feminists, it is enough for a man to be accused of sexual harassment, for it to be assumed true.

Now it will undoubtedly true, that (as with white people) some black people will commit crime, some  homosexuals (as with straight people) may be immoral, some atheists (as with some religious people) will lack morals, many women (as with men) will be irrational at times, many men may be guilty of sexual harassment – but in all such instances it will not be all. In such cases of prejudice the supposition is – guilty until proven innocent!  It is a dangerous supposition from the standpoint of the oppressed who would suffer from it most – and which is the opposite of the modern concept of – innocent until proven guilty.

The rational position in such cases is to demand sufficient and substantive  evidence and the rational response of those accusing is to present that sufficient and substantial evidence. Only in the eyes of those already prejudiced (including those on the left) is it a failing or crime to remain neutral until such time, and as in this Assange case, which has a further dimension, to consider that other dimension.  This issue of dispute, as with others, reveals the lack of maturity of the left in general and the anti-capitalist left in particular, along with its own self-entrapment in dualistic modes of thinking. In this bourgeois mode of thinking there are but two basic principles.

1. In any dispute, you must choose one side or the other; one side must be right, the other side must be wrong. Or mostly right and mostly wrong.

2. You are entitled to make up your mind on any issue based upon ‘official’ or ‘authoritative’ assertions and the flimsiest piece of evidence, particularly, if it fits your pre-conceptions.

These two principles infect, not only bourgeois thinking in all aspects, from the scientific to the religious, but also inflicts the bourgeois forms of socialism outlined by Karl Marx.

In the real world, it is not necessary to take sides on an issue, particularly where it is muddied by lack of information, contradiction and distortion. In the real world  both sides of an issue can be wrong. In the world as understood, by the revolutionary-humanism of Karl Marx, you only make your mind up after lengthy, careful and prejudiced free analysis and even then maintain it with doubt for new evidence may arise, which causes a reappraisal of your analysis.

See also article at Links

RR

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WHOSE UNDER THE FISCAL CLIFF?

Posted on August 15, 2012 by stutteringsteps

Over the last few months the term ‘Fiscal Cliff’ has become increasingly popular in political as well as financial discourse. The term originated in the US, to refer to a series of impending tax increases and government spending cuts which are intended to cut the huge government deficits. As matters currently stand, the projected US yearly deficits over the last ten years has increased from $128 billion to $1.2 trillion. The debt ceiling (the legal limit of total US government debt allowed) is set at approx $16.4 trillion and already has reached $16 trillion. Both sets of figures are now considered by all US political parties as unsustainable and are therefore in their eyes in need of correction.

However, such huge sovereign debt problems are not restricted to the US economy, but apply, to a lesser extent, to the countries of Europe and elsewhere. The ‘cliff’ analogy refers to the expectation that governmental budget austerity and cuts will lead to a huge drop in economic activity possibly in the form of ‘double-dip’ recessions. The ‘correction’ of such deforming deficits raises the question of who in the US and Europe is going to be buried under the debris when the ‘fiscal cliff’ finally collapses. To continue with the ‘cliff’ analogy for the moment, those in the economic and political elite are currently proposing policies which will ensure that the 1% will be the first to be evacuated from under its impending collapse.

On the other hand, the weakest elements of the 99%, those with fewest resources, will be left at the base of the cliff, whilst those better off among the 99% will have to scramble to safety as best they can. We will definitely not be all in this collapse together. The solutions which all current mainstream political parties propose are variations on the same basic theme. First: Cut spending on welfare and public sector employment in order to reduce government expenditure, whilst increasing costs and indirect taxation to improve government income. Second: Hope for sufficient economic recovery, to soak up the exceptional levels of unemployment caused by these measures. The variations are only about how quick these policies should be implemented and how much charity should be extended to the shattered victims of austerity and the disintegration.

It is popular on the liberal and soft ‘left’ to argue that there is an alternative set of policies to the currently evolving crisis. These amount to policies which will save capitalism from its own worst symptoms and soften the blows for the able-bodied poor and those less fortunate. Some of these alternative suggestions have been promoted along the lines of; ‘government debt is not all bad; that government debt has been higher in the past; that government spending boosts private capitalist economic activity; that the current problem is caused by a shortage on money supply; higher taxes on the rich should be implemented; a financial transactions tax should be initiated; etc. These sorts of proposed solutions emanate from the ‘democratic’ or ‘liberal’ political spectrum in the USA and from the ’socialist’ democratic political and trade union spectrum in Europe and the UK.

The pro-capitalist, anti-worker and anti-poor logic of these political trends is clear! For these advocates, its OK that working people have to pay high taxes to fund insane levels of government (war-enhanced) debt and continued borrowing; its OK for the rich to exploit the poor, providing they don’t dodge taxes and pay an increased amount of it; that it is OK for financial speculators to rip off everybody, providing they are taxed a bit more when they do so; that it is a good idea for general tax payments to be used for enabling private enterprise and personal capital accumulation. In other words, these policies are what every enlightened bourgeois individual should want and advocate. In fact the system should be criticised and exposed for what it is doing and not doing, not humbly reminded of what it should – in all honesty – be already doing.

Significantly, these types of reformist stage management policies are only focussed on the symptoms emanating from the capitalist system. The advocates of reform measures, do not seem to understand the underlying systemic nature of the developing capitalist crisis. This current crisis is not something which can be reformed away by tax increases and regulation, because it is made up of at least five, fundamental and irreconcilable contradictions. [see the ’Five-fold crisis of Capitalism’]

These fundamental contradictions can only be resolved by violently suppressing one side of the contradiction or the other. The two sides are, on the one hand, the capitalist system and its supporters, and on the other, the combined sections of the working and oppressed classes. What is currently being seriously prepared by the elite is not financial regulation of themselves and greater fiscal responsibility, but class war – initiated by the capitalists and their political supporters.

Of the five contradictory elements, one in particular has been insufficiently analysed with regard to an important development of 20th century capitalism and the consequent rise of a new employment sector for the working classes. That development, the public sector, (teachers, social workers, health workers, local government workers, fire-fighters, police, military, civil servants) is obvious to all, but the economic consequences of this sector, in the cycle of capital circulation and accumulation, has largely been ignored and little understood.

With the neglect of Marx among activists, few people on the left have bothered to consider his 19th century analysis of productive and unproductive labour. This neglect is perhaps not surprising, but in the current circumstances, it leaves an important dimension out of consideration by our anti-capitalist understanding. [For a fuller description of this distinction see Productive and Unproductive labour.]

Explained briefly, productive labour, from the standpoint of the capitalist mode of production, is the employment of workers to reproduce and augment their capital. Unproductive labour, however useful and/or necessary, which does not reproduce invested capital, together with a return of a surplus amount (profit) is not productive. Indeed, under the capitalist system, unproductive workers are a drain upon, (a deduction from), the annual surplus extracted from workers employed productively in their various production processes.

Since a part of these annual surpluses, must be surrendered (as taxes) to the governments of capitalist countries, to exercise their functions, there is a struggle by the capitalist classes, over how much, or rather how little they are compelled to surrender. It is these taxes (corporate and individual), together with government borrowing, which currently provide the wages of the public sector.

Individual capitalists and their companies, avoid tax in numerous ways, and their political representatives and lobbyists campaign to reduce the official levels of taxation. The huge deficits run by the US government and noted above, are in a large part the result of the successful lobbying to lower taxes for the rich which commenced under the George W Bush administration in 2001 and again in 2003.

Tax cuts in the US were extended in 2005 and 2007 and again in 2008 and it is estimated that these tax cuts removed $1.1 trillion dollars from government revenue, which had to be replaced by borrowing. This pattern, to a lesser degree has been replicated everywhere in the capitalist world. It is a part of the neo-liberal capitalist agenda to cut taxes for business and the rich and slough off parts of the public sector which can be re-structured into a capitalistic form.

It is, however, only on the surface, that the problem seems to be one of taxation. It may seem that what is needed is to increase taxes, and stop tax avoidance, to correct a fiscal imbalance within capitalism. But fiscal deficit is only a surface symptom which, like an eruption of ash and pumice from a volcano, has a much deeper underlying pressure and substance beneath it. That pressure and substance is the changed ratio under modern capitalist production methods between productive labour and unproductive labour.

This ratio together with the desire of capitalists and pro-capitalists to reduce taxation is causing an attack upon the numbers (along with the salaries and benefits) of those employed in the public sector. This sector along with the poor, the old and the infirm, are those, under this system, who are further threatened by the impending collapse of the fiscal cliff. So far this is only producing rumblings of discontent, but sooner or later this sector is likely to explode. [see’workers and others in the 21st century‘at www. gmanticapitalists.com]

Irrespective of any increased taxes and rigour with regard to collecting them, the underlying problem still remains. The technical levels of production has increased exponentially and its location has spread geographically. The consequent changed ratio between workers who are essential for the reproduction and growth of capital and those who are essential to working people, but a drain on capital, is a fundamental change in the social composition of work. These are problems, not of taxation, but of fundamental economic contradiction and crisis.

The capitalist drive for profits is not only mass-producing commodities, but mass-producing unemployment in the private sector and now the public sector. It is also mass-producing pollution and ecological damage alongside mass-producing obscene amounts of wealth for a relatively small elite, only a little of which trickles down. The current crisis should be a catalyst for widespread debate upon the degenerate and militarised nature of 20th and 21st century global capitalism and the need for an alternative system. It should not be diverted or restricted to discussions on taxation alternatives.

Roy Ratcliffe (August 2012)

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THE SPECTRE OF STALINISM.

Posted on August 6, 2012 by stutteringsteps

As the present economic and financial crisis deepens, more working people and other sections of society will undoubtedly come to question the continuation of the capitalist system. However, exactly at that point they will be confronted with the spectre of Stalinism and Russia. This phenomena and its practice in the Soviet Union and elsewhere, will be used by pro-capitalists of all spectrums, to discourage any projected ideas or attempts of going beyond capitalism. For this reason it is essential that anti-capitalists understand, not only the specific practice of Stalinism, but its connective tissue with the vanguardist tradition of Bolshevism/Leninism and its further roots in sectarianism. This article offers a short introduction to this problem.

It is a fact that over the last seventy years a dark shadow has hung over the vision of an egalitarian post-capitalist society. This shadow was first cast by Bolshevik sectarian intolerance, but it became darkest under the regime of Joseph Stalin. Stalin and his followers were certainly not anti-capitalists even though many of them thought they were and declared so. Their self-deception came about by the fact that they often oppressed the owners of private capital. However, in practice and particularly during Stalin’s rule, they became nationalistic activists who purged themselves of all humanity in pursuit of state-capitalist economic, political and military power.

Stalin and the Stalinists turned a distorted anti-capitalist theory into dogmatic assertion and they tried to subordinate the world anti-capitalist movement to their own needs. They also displayed bitterness and poisonous hatred in dealing with rival anti-capitalists and even with their own members who dared to criticise them. They were often boastful and arrogant and had an unshakeable belief in their ‘correctness’ despite the contradiction between that conviction and the actual developments taking place. All these characteristics are those of sectarianism. (See article ‘Sectarianism and the General Strike’ at this blog.). Stalin frequently claimed to be a Leninist and a follower of Marx, but this latter assertion was also a delusion.

It is certainly possible to find evidence to support the claim to be following Lenin, but he was definitely not in the revolutionary-humanist tradition of Karl Marx. In fact when sectarianism is considered in some detail it is clear that the phenomenon of Stalinism was political sectarianism with full control of, and support from, state power. It was thus a form of sectarianism writ large. Yet Stalin was not the sole originator of sectarianism nor the only supporter of authoritarian state capitalism. If one examines the published volumes of Lenin from 1917 to 1923 before his illness and death in 1924, among other things, it is possible to identify the following repeatedly mentioned views.

1. Socialism could only be realised on the basis of a highly industrialised, centralised, planned state-run economy.

2. Workers could not be considered trusted until they were tested and approved by the Bolshevik Party.

3. Workers would have to voluntarily accept the work discipline ordered by the state planners or be forced to accept it.

4. Workers and peasants were by and large too uncultured to run their own affairs.

5. The politics of Bolshevism/Leninism alone must guide all aspects of economic, political and social life.

In the article, ‘Marxists against Marx’ (on this blog) and in the book, ‘Revolutionary-Humanism and the Anti-Capitalist Struggle’, I have detailed a number of the authoritarian positions of Lenin which indicate more than just a thin edge of subsequent Stalinist dictatorial practices. Of course, under Stalin, state terror against its own citizens was pursued to extraordinary lengths and depths of depravity. Even former close colleagues, for example, were tortured and killed on his orders, by his many supporters. As a former admirer and disciple of Stalin and later Soviet Leader, Nikita Kruschev remarked;

“Many of the leaders of our Party and our country were wiped out. Where had men like Molotov or Kaganovich or Mykoyan been when Zinoviev, Kamenev, Trotsky, Bukharin and Rykov were running the country? Almost the whole of the Politburo which had been in office at the time of Lenin’s death was purged.”(Krushchev Remembers. Penguin. Page 102.)

Roy Medvedev, a Soviet academic also concluded in ‘Let History Judge’ that, “..these were not streams, these were rivers of blood..”. The fact that Stalinism was a distinct political tendency is born out by the evidence that it did not disappear when Stalin died in 1953. Indeed, it continued as a sectarian tendency throughout the 1960’s, 70’s and 80’s. During that period it polluted and weakened practically every struggle it became involved with. It was alive and well (or perhaps we should say alive but still sick) in 1993, forty years after Stalin’s death. In the Daily Worker of April 2, 1993 appeared the following sectarian assertion;

“Our central aim is to re-forge the Communist Party of Great Britain. Without this Party the working class is nothing; with it, it is everything.”

This group of alleged anti-capitalists were the inheritors of the Stalinist tradition. Their paper, the Daily Worker, had previously supported, state-control of economics, politics and social life in the Soviet Union. For decades they, and their comrades had silently or vociferously, supported Stalin’s every twist and turn, every show trial, every massacre, every Gulag and every incident of torture. Yet as the above quote illustrates, they were not just passive followers of the sectarian megalomaniac Stalin, they were active sectarians in their own right. They did not always need to be instructed by Stalin, they knew exactly how to continue being sectarian. Note that even in the 1990’s forty years after Stalin’s death, they considered that without them ‘the working class was nothing’.

This assertion displays the almost complete sectarian arrogance and patronising contempt for working people. So elitist was the public stance of this group that they reversed the real relationship between a class and those which sought to represent it politically. Yet in that particular ‘vanguardist’ tradition, they were not alone. Many 20th century Maoist and Trotskyist groups held to a similar, if not as publicly declared position as this. In actual fact it is more true to say that without the working class and non-sectarian anti-capitalist activists, this particular Party, or any other for that matter, would be nothing. Nothing that is, except an inconsequential sect.

Stalinism is now largely dead as a political tendency. It has hardly any roots in working and oppressed communities. However, its sectarian sub-soil, from which it developed has not yet been finally cleared and sanitised. Modern, political sectarianism, more often than not, adopts a more benign posture seeking to ‘lead’ the working and oppressed classes – for their own good. Many sectarian groups, still cling tenaciously to the neo-Leninist position that their political leadership alone – organised as an eventual ‘party’ – is capable of correctly leading and guiding (ie controlling) the struggle against capital and any subsequent re-construction.

Perhaps in a short article on Stalin and Stalinism a final word should be left to Stalin himself. Writing at the height of the purges, when up to a thousand people a day were being shot on his orders, when concentration camps full of diseased and dying workers and intellectuals were being worked to death, Stalin was able to state;

“We communists are people of a special mould. We are made of special stuff. We are those who form the army of the greatest proletarian strategist, the army of Comrade Lenin. There is nothing higher than the honour of belonging to this army.” (History of the Communist Party. Foreign Languages Publishing. Page 268.)

Special stuff indeed! It takes very special people to distance themselves from their own humanity, throw away all morality, bury any feelings of guilt and lie, cheat, torture and murder – or look the other way. Thankfully there are very few people who are of such special stuff, but sadly there are some in every community in every part of the world. Indeed, this type of self-elected leadership of a ‘special mould’ now seems to have gravitated to religious sectarianism, where all the above characteristics are manifested against their own religious communities who think differently and against the members of other religions.

It is clear that any really positive and fruitful anti-capitalist movement will need to confront any remaining Stalinists and the contemporary benign political sectarians with the full implications of their tradition. The idea of any form of political control now and in any post-capitalist form of society, needs to be confronted well in advance of such developments. For as Marx warned;

“Where political parties exist, each party sees the root of every evil in the fact that instead of itself an opposing party stands at the helm of the state. Even radical and revolutionary politicians seek the root of the evil not in the essential nature of the state, but in a definite state form, which they wish to replace by a different state form.” (Marx/Engels. Collected Works. Volume 3 page 197.)

We now have the experience of the Bolshevik-led Soviet Union which confirmed the prognosis of Marx with regard to the political mentality; “..the keener and more lively it is, the more it is incapable is it of understanding social ills”.

Roy Ratcliffe (August 2012.)

 

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THE FIVE-FOLD CRISIS OF CAPITALISM.

Posted on July 23, 2012 by stutteringsteps

It should be obvious to anyone not completely in denial, that 21st century capitalism is currently mired in the most severe problems for over 80 years. This particular crisis is quite evidently a multiple one. It comprises of economic, financial, social, ecological and moral elements – each of substantial magnitude. It is the co-incidence of these fundamental parts of the current crisis of capitalism, which gives it its particular significance. If this current set of intractable problems does not exactly herald the actual death agony of the capitalist mode of production, then it is certainly the case that the systems supporters are being forced to fight to the death for its continued existence.

Any one of the above noted elements would be sufficient to create a groundswell of opposition against the capitalist system. However, the correlation of all five aspects of this crisis, and the consequent depths to which they will drive it, should ensure the most profound and widespread questioning of the system of capitalism. The consequent development of a critical questioning attitude among different layers of society presents a substantial opportunity for the anti-capitalist movement to engage once more with a mass audience.  This engagement should take the form of a widespread dissemination of the five elements, which are briefly examined below.

1.    The economic crisis.

The economic aspect of the current crisis takes the form of an overproduction of commodities and an overproduction of capital invested in commodity production. The capitalist mode of production based as it is on the pursuit of profit, actively promotes ‘commodity fetishism’. It also routinely produces more commodities and services than can be sold at a profit. Each increase in technology, and in the number and diversity of capitalist enterprises employing masses of workers’, constantly re-creates this problem of relative overproduction. This process leads to stagnation, slumps and eventual crisis. ‘Growth’ is the underlying primary cause of the current economic, financial, social and ecological problems, not the solution to them.

A further associated feature leading up to the present economic crisis had been a general fall in the rate of industrial and commercial profit. This ‘fall’ resulted in many capitalist production facilities and investments being transferred from the advanced countries of Europe and North America, to those in the east and south. These regions were chosen because of their lower labour costs.  This fall in the rate of profit, due to competitive improvements in technology, is an integral product of the capitalist system and has re-occurred with predictable results. This pattern cannot be reversed or transcended without transcending the capitalist system itself.

The capital ‘outflows’ from the advanced countries led to three further symptoms related to current financial, economic and social problems. First it left unemployment behind as factories closed and workers were laid off, thus increasing the social costs of compensating for the loss of wages. Second and closely related, it reduced government revenue from direct and indirect taxes. Third, this reduced income increased government ‘borrowing’ and in this way placed the ordinary citizens of numerous countries into the grasping hands of the capitalist bond-market.

Simultaneously, the export of private capital to low-wage economies in Asia and South America, over the last several decades, resulted in a relative increase in both the rate of corporate profit and in the mass of profits available to the rich – primarily in the advanced capitalist countries. Since not all of this massive increase of profits was needed for re-investing in industry and commerce, a great deal of this surplus capital was siphoned off into the financial sector of the capitalist system. It was a deluge of surplus capital which kick-started and fuelled and current the financial crisis.

2.    The financial crisis.

a) Leverage and fictitious capital.
Recent events have demonstrated that the finance-capital market has expanded so rapidly and exponentially that it has become the tail that wags the dog so to speak. This sector comprises of banks, investment firms, brokers, accountants, specialist legal firms, other related businesses and trading venues such as Wall Street and the City of London. With more spare capital available than the industrial and commercial capitalists needed, its owners sought alternative sources of investment and it is these ‘financial’ institutions and firms that have provided the dubious channels and instruments to enable this to take place.  Not surprisingly, a recent government report (the Kay Review) was so appalled that it concluded that the City of London was ‘not fit for purpose’.

One of the ‘not fit for purpose’ sources of instability within the financial sector is the extent to which banks and other financial institutions, can extend credit many times beyond the amounts of assets they actually own. This difference between what they retain and what they lend, is called ‘leverage’. If a bank has 1 million ($, £, Euro’s) in currency deposits, for example, and it sets its leverage at 20, it can extend credit up to 20 million. It is obvious from this that if the depositors all wanted their money back, the bank would not be able to pay. This credit source, since it comprises only of ‘promises to pay’, amounts to a fictitious form of capital. And of course, credit lent out which does not get repaid, causes the chain of bank defaults we are now partly witnessing.

Banks are not the only issuers of fictitious capital and the leverage can go well beyond the supposed level of 20, with some banks leveraging up to 60 times. It is here that we should remember the financial crisis publicly emerging in 2008 and still continuing. It was then described in terms of ‘toxic loans’ and ‘credit defaults‘. We need only recall, the internet speculative ‘bubble’ of the late 20th century and the 21st century, collapse of the housing mortgage ’sub-prime’ mortgage packages in the USA, to see what an extended chain of liabilities and defaults can bring about. This is the inevitable outcome of the ‘vibrant’ financial sector supported and still promoted by politicians of left, right and centre, throughout the capitalist countries.

Because the financial system is an integral part of the capitalist system, this extension of leverage, credit and speculation effects not just the financial sectors, but all members of society. The most effected being the poor, the unemployed and the working classes. This is because, a breakdown at any link in the increasingly complex chain of leveraged credit circulation throws the whole essential economic process of production and exchange into chaos, confusion and crisis. Yet this is not the only problem bearing down on working people, because the financial sector is also the source of the now crushing levels of sovereign, or governmental debt.

b) Sovereign Debt.
As noted, a part of the finance capital market lends money and credit to governments and in this way, services government debt.  From very early on in their development capitalist governments have borrowed money by issuing government bonds and repaying them with their income from taxation and the other duties.  With the huge reductions in government revenue, due to reduced direct taxation from workers, firms and tax-dodgers, capitalist governments have increasingly relied upon massive borrowing from this source.  In the present circumstances of capitalist initiated structural change and crisis, this level of borrowing can no longer be repaid by future taxation. Under the present pro-capitalist regimes, governments and their citizens are now subject to the whims, needs and dictates of the bond-holders.

The transformation in the technical composition of industry and commerce (computer controlled automation etc.) and the consequent change social composition of working classes are both irreversible symptoms. The modern capitalist system of industrial and commercial production no longer needs as many paid workers as previous generations. As a consequence the capitalist states can no longer afford to support as many unemployed and public service workers as they have previously. Hence, the current and future efforts to reduce welfare expenditure and the numbers of governmental and public-sector employees. The logic of this entire process has now created a serious social crisis.

3.    The social crisis.

The modern technical developments of the capitalist mode of production have produced two substantial and contradictory changes to the economic and social structure of capitalist countries. The first change is in the proportion of money capital required to set up, or develop, the fixed means of production (factories, machinery etc.) and that paid to the flexible elements of production (employees).

a) The ratio of constant capital to variable capital.
As already noted, this aspect refers to the relationship between the means of production (constant capital) and the numbers of people employed in them (variable capital). The number of industrial, agricultural and commercial workers, required for a given amount of production has been massively reduced. This, in capitalist economic terms, has resulted in the creation of an increasing surplus labour capacity or in social terms – relative and permanent levels of unemployment. However, in the advanced capitalist countries, the development of jobs in the welfare state, was (for a time) able to absorb some displaced members of the working and salaried population and their offspring. The second change is to the proportion of workers producing surplus value to those workers providing services.

b) The ratio of productive labour to un-productive labour.
So the same development of industry and commerce which altered the ratio of fixed capital to variable, has resulted in a vast reduction in the number of working people required to maintain the basic levels of existence necessary for the average person. Hence, during the late 20th century, a reverse shift occurred in the numbers of workers employed in industry and commerce, compared with those employed in the public sector occupations such as, education, social services, health, local government and other public services. These 20th century developments, (along with the co-operative movement) in essence represent a shift away from the capitalist mode of production whilst remaining dominated by the capitalist mode. They are organisations producing for need, not greed, within the existing capitalist mode but with an alien controlling hierarchy which is parasitic upon them.

It is important to understand that under the capitalist system the surplus value produced by those who work in the production of goods and their related services is the source of the income required by other sectors of society.  Under the capitalist mode of production the income, in monetary terms, generated by the sale of these goods and services, provides the profits and the various taxes from which government employees wages and salaries are paid. It is not that occupations in the public services are unproductive in general, it is that they are not directly productive of surplus value, which the capitalist mode of production is based upon.

That is another development which the supporters of capitalism must now try to reverse. In order for the governments and the rich to hang onto the bulk of the surplus production, they must now ensure that even less goes to the ordinary citizen. Pursuit of this policy, dressed up as austerity, will radically ramp up the class struggle in each of the advanced capitalist countries, with similar repercussions within countries less advanced.

Another important change in the social structure of advanced capitalism concerns age. Life expectancy in the advanced capitalist countries has advanced well beyond the previous retirement age.  In the UK, for example, it is estimated that there are over 400,000 citizens over 90 and over 3 million over 60. These figures, replicated in other advanced capitalist countries, should be something to celebrate.  However, under capitalism they are a problem. This is because under capitalism the retirement age signals the onset of a period in which wage-labour ceases and along with it, a wage income from which to live.

Because of the relatively low levels of pay, and high levels of taxation, during their working life, many workers have had to rely upon the state for their retirement pensions. In this way, the extended 20th and 21st century development of capitalism has created a mass of employment-aged workers, who are no longer needed by capitalist industry and commerce, together with another mass of older workers who have retired. Under capitalism, both categories are now too ‘expensive’ to support, particularly when capitalist governments want to spend, spend, spend on sophisticated armament programmes. The capitalist system will need to discard many of the present, public service workers, unemployed and retired workers, unless the workers discard capitalism. The future really is as stark as that.

4.    The ecological crisis.

a) Pollution.
The manufacture of commodities generates by-products which in the vast majority of cases, are treated merely as waste.  In the majority of cases these waste products are not profitable and the safe disposal of them would require a deduction from the profits, so they are simply dumped at the nearest and/or least costly place. This leads to the ruthless extraction and exhaustion of raw materials provided by nature and to the negligent dumping of waste.  Many of these unwanted waste products of industry and agriculture are highly toxic.

It is reliably estimated that the existing process of production and transport now mixes into the air 15 million tons of soot and dust per year. In addition, two hundred hazardous chemicals are also regularly vented by industry into the atmosphere. Many of these chemical pollutants are cancer causing carcinogens, which permeate the air and wait to be sucked into our lungs with each breath.  According to the World Almanac of 2011, over 3 billion lb. of toxic chemicals are allowed to escape into the air each year in America. America is only one of many advanced industrialised countries of the world which daily add their respective contributions to this huge amount.

Water is another essential of life that is constantly and increasingly being polluted as a by-product of the capitalist system of production. It is not just the chemical rain which finishes up in rivers and the sea.  Many of the chemicals used in food production (pesticides herbicides and fertilisers) are drained from agricultural land by rain, and finish up in the rivers, groundwater, and the sea. There they join the billions of tons of crude oil which are regularly dumped into the sea and the billions of tons of solid waste from the kitchens and toilets of the worlds seaside towns and cities.

b) Ecological destruction.
The capitalist mode of production requires large consignments of raw materials, which are obtained as quickly and profitably as possible. Trees are sawn down for timber in large quantities irrespective of the short and long-term effect upon the environment such as species loss, soil erosion and depletion of the oxygen-generating nitrogen cycle. 170,00 square kilometres of forest and woodland is eliminated annually and 150,000 of arable land is lost to desertification. Minerals are extracted from the ground in the quickest and cheapest, often open-cast way, again irrespective of the detrimental effects upon the immediate and surrounding environment.

Land fill dumping, because it is cheapest in the short term, is also the preferred method for storing the hundreds upon hundreds of tons of nuclear waste products, some of which will take thousands of years to decay to a point at which they are no longer dangerous. Rising rivers, hurricanes and alternative droughts and heavy rainfall occurring at times when they are not normal, or in places where they do not normally occur, cause damage to villages, towns and cities by floods or fires.  Many low-lying human communities throughout the world are in real danger of repeated floods making their lives miserable and dangerous. There are currently a further 1,667 species endangered or threatened ranging from mammals through birds and reptiles, to fish, insects, conifers and ferns.

Forests are cleared to create short-lived profit-led capitalist plantations, which soon exhaust the land and where the soil, lacking the previous binding power of tree roots, is soon washed away. Soil erosion of 5 – 10 tonnes per year is taking place in Europe, Africa and Australia and to a larger extent elsewhere. Thousands upon thousands of small, and large, ecosystems are being destroyed annually and their wildlife robbed of their habitat and food sources as global capitalism searches every nook and cranny – even the deep sea trenches – to exploit the planet’s resources in order to turn in a quick profit. Capitalist production, based as it is on the profit motive, cannot end pollution and ecological destruction.  In a very real sense the planet cannot sustain a further epoch of capitalist industrial production and exploitation.

5. The moral crisis.

Any socio-economic system based upon exploitation has at least one foot in a moral quagmire. The system of capitalism, however, has both feet firmly planted in a veritable cess-pit of corruption and moral degeneration. The elite economic, political, military, state, medical and even religious actors in capitalist society are embroiled either indirectly or directly in the immorality stemming from the capitalist mode of production.  Here are just a few examples.
The financial elite actively assist the miss-selling of financial services, and are involved in extensive financial manipulation. As recent evidence regarding HSBC suggests, this extends to substantial money laundering. Politicians are directly and indirectly bribed by businesses and routinely fiddle their expenses. They, along with practically the whole of the well-paid capitalist elite, enter into tax avoidance schemes. Indeed, it has been estimated that the rich throughout the capitalist world have managed to hide up to 13 trillion dollars in offshore tax havens. In this way, even though they are the most exceptionally rewarded, they still try to avoid paying a significant share toward, the social welfare and infrastructure provisions from which they benefit.

The media, is another active supporter of the capitalist system and its elite will stoop to the lowest depths and commit the grossest distortions for profit or advantage. The Levison enquiry in the UK, has recently exposed, what many people already knew, that the owners and senior staff are part of the ‘establishment’ elite and in pursuit of profit, behave accordingly.  But also by biased reporting and distortion, they often hide malpractice and present a view of the world which is beneficial to them and detrimental to any serious criticism of, or opposition to, the system as a whole.

The police record on deaths in custody is appalling and the recent acquittal of a police officer who had previous form with regard to violence, is typical. This example is merely the most recent exposure of an institution with almost unlimited power combined with almost no respect for and accountability to, those (the public) who finance it with their tax payments. Even the elite members of the medical profession are not immune to improving their already comfortable earnings, by private fees from ‘vanity’ surgery such as ‘tucks’ and inserting unsafe breast implants. Worse still some in the UK, for example, make money from the genital mutilation (clitoral amputation) of very young girls. The rationale of respecting patriarchal ‘traditions’ in the latter case is a thin camouflage that displays no respect for a female’s rights to decisions effecting her own body.

The military carry out the most horrific crimes against humanity if ordered to do so by their political and military superiors. Killing on a large scale, without any pretence of due process, is now a routine procedure for the armed forces of the advanced countries of the world. The most recent blatant case concerns the interface between the USA political elite and the ‘military industrial complex’ which has developed a ‘drone’ assassination culture. The US president, without any substantial evidence or due process, can now order the assassination of anyone it suspects of activities against how he sees the ‘national’ interests.

The religious elite’s not only turn a blind eye to this form of killing but in some cases bless the military perpetrators and conduct services in their honour. For centuries, religious elite’s have been an ideological prop to whatever ruling elite was in power. This has not altered under the capitalist system and they remain firmly hand in hand with the elite’s of politics and the state. All three religions Judaism, Christianity and Islam, also perpetuate a hierarchical and patriarchal form of ideology. It is a system of ideas which fits comfortably with capitalism, to the detriment of the poor and in particular women.

6. Resistance to the crisis.

Resistance to this five-fold crisis is as yet sporadic and varied, but it is continually growing. Those occupying the lower socio-economic positions, under the capitalist mode of production; workers, students, unemployed, disabled and working class pensioners are the ones suffering the most at the moment. However, those salaried workers employed in the public sector, nurses, teachers, social workers, local authority and central government workers are also facing immediate and future losses of income and job security. There is therefore the potential for a great deal of solidarity and some degree of unity.

The forms of organisation created under previous stages (and earlier economic cycles) of capitalism, are no longer capable of effective resistance to this multiple crisis. Trade unions are heavily bureaucratised, single-issue campaigns are being sidelined, political parties are elitist as well as being part of the problem. The need for across sector unity and solidarity has spawned new forms of non-hierarchical organisation such as ‘Occupy’, Uncut and others. New generations of activists do not share the illusions in politics that previous generations suffered from. There is growing awareness, internationally that politics is the problem, not the solution.

The large sustained demonstrations, which have featured so much in the Middle East and North African protests, are now close to being replicated in Europe. Already Greece and particularly Spain, both of whom are at the head of the capitalist inspired austerity queue, have witnessed numerous and growing numbers of citizens, demonstrating, protesting and demanding. So far the dominant protests everywhere are no more than polite requests or impolite demands to the economic and political elite to change or stop what they are doing. This ingrained deferential habit is something that will sooner or later have to change.

Placing demands on a pro-capitalist elite to curb capitalism, is unlikely to succeed and sooner or later working people will be faced with either having to accept the fate handed out to them or they will have to find more positive ways to fight back. Historically, placing demands upon any state has been to accept and adopt a subordinate posture. In the 21st century, to place them on states in such present dysfunctional conditions is also an act of complete folly.  Politics and the state are the problem, not the solution. Indeed, the state is already being used to suppress protest and will be used in future to prevent solutions emanating from the ordinary working class citizens.

For this reason, self-organisation, self-activity and community co-operation, are the only sustainable solutions for the future of humanity. These are the necessary organisation forms not only to defend communities, but to become the embryo for present and future economic and social formations. They are also the only forms that will enable people to break out of the deforming and destructive capitalist ‘mode’ of production, and introduce a mode of production based upon social need, rather than private greed.

Roy Ratcliffe. (July 2012.)

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ITS OFFICIAL! CAPITALISM IS BANKRUPT.

Posted on July 13, 2012 by stutteringsteps

The announcement this week (July 9 – 14th) that the state of California has filed for bankruptcy demonstrates one clear example of what should be increasingly obvious to everyone. It is that the system of capitalism is bankrupt. Every advanced capitalist country on the globe is technically bankrupt – it just hasn’t been fully recognised and declared everywhere yet.

Declaring bankruptcy makes sense. Filing for bankruptcy when income consistently falls below expenditure and loans are no longer rational or available, (ie the basic condition of all current nation states) is the obvious and logical solution under the economic logic of capitalism. Bankruptcy reduces, or eliminates entirely, the debts entered into by the directors of a company or in this case, the ‘officials’ of a state or country.

Of course it is not only outmoded or unrealistic enterprises that can become bankrupt. Even a basically sound relevant project can be ruined by corrupt or negligent owners or managers. It is also the case that if the basic economic structure of the business is sound a bankrupt project can be bought by others at a rock-bottom price and be back in business, immediately – or at least in a very short time.

That process already takes place on a regular, if somewhat erratic basis, in the world of business and commerce. Bankruptcies among businesses are increasing exponentially as the crisis develops. However, it rarely occurs in the realm of states and countries. California demonstrates, however, not only the possibility, but perhaps also the increasing probability of such an outcome. And from the standpoint of the working and oppressed classes, if properly handled, declaring a capitalist country bankrupt, and starting afresh is not an undesirable possibility.

The reason being that for states and countries, (unlike unrealistic or speculative profit-based businesses) the basic economic structure is always sound. The citizens of a state or country, even a sparsely populated one, are overwhelmingly productive in the economic and public service sectors of their respective communities. The only reason a state or country becomes so much in debt, that it faces bankruptcy and tries to saddle the citizens with this debt, is because those in charge (politicians and senior civil servants) have spent more than the income from the various taxes paid by the citizens.

In the absence of famines, wars or foreign occupations, states and countries are fundamentally always sound. Only under capitalism and the subsequent corruption and extravagance of the elites, groomed by the system, can states and countries be systematically ruined. It is the senior political, economic, military, state and private enterprise elite, not the ordinary people, who are the ones who have been bankrupting the various nation states of the capitalist world.

At least since 2008 it cannot have escaped anyone’s notice that corruption has occurred in Parliamentary politics (cash for questions, expense abuses, tax avoidance). The same period has witnessed senior (and lower) police corruption, newspaper phone hacking, military requisitioning malpractice, sub-prime mortgage miss-selling, interest rate manipulation and corruption in the private equity interface with government. Members of the board of the department of taxation, in the UK for example have been getting second jobs as tax-avoidance consultants. They are currently drawing salaries from our tax payments and drawing further salaries from the wealthy for helping them to avoid paying their share.

Corruption is everywhere. The recent revelations of GlaxoSmithKline the drugs company bribing Doctors to prescribe unsuitable drugs to children and Bankers (Libor) fixing are just the tip of an extensive iceberg of corruption, negligence, profiteering and incompetence which extends, not just through middle eastern elites, but also through those in Europe and the west.

Politicians claim they are running things for their populations benefit, but in fact are busily ruining states, countries and communities throughout the globe. The current austerity packages they insist are necessary, are only designed to postpone the inevitable – bankruptcy. Such measures will ruin people’s lives, the civil infrastructure and basic economic fundamentals necessary for life in modern society – all in a vain attempt to save they system they feed off.  That it if we let them.

Consider some basic facts. Over the past several decades, the levels of taxation levied on working people (the ones who can’t dodge paying taxes) has been of the following magnitude. Income tax is set at around an average of 20% of income. National Insurance is set around 12% and VAT is now currently at 20%. If we add the employers contribution to the national insurance contribution of workers, the rate of government income from this source is roughly 40%.

So, in the UK we have all contributed some 40% or so direct taxation from our wages and salaries and for many years similar substantial amounts. Also since the introduction of VAT we have paid VAT on practically everything else from what is left of our earnings after taxation. How can a country of millions not be sound on the basis of giving to its government up to half of everything its citizens have earned?

At one level the answer is simple. It shouldn’t! A state or country can only get in such an atrocious condition by consistent and persistent mismanagement over long periods of time. How that mismanagement operates through different political elites and state institutions is a complex question, but the bottom line is glaringly simple. The previous noted complexity goes for the political/managerial elites interface with the other forms of elite players in each country. Collectively they are what used to be called the ‘establishment’.

The main agreement between the economic and financial elite has been resulted in the following cosy ‘establishment’ relationship. The political and civil service elite interfere as little as possible (light or zero touch regulation/legislation) with the economic and financial elites activities. In return the economic and financial elite support the political class, by political donations, paid consultancies and future jobs.

The case of the light financial regulation which has resulted in the runaway speculation and the packaging of various spurious investment instruments (derivatives etc.) is just one of many examples which has now come to light. This particular one is part of the reason for the near bankruptcy of many countries as well as the bankruptcy of the state of California. The California state pension bill, for example, was increased from 300,000 dollars to 3.5 billion dollars, by the purchase of such unregulated financial instruments.

In yet another important area of life, the lack of political regulation of industry has also been largely responsibility for the increased incidence of obesity and type 2 diabetes among the populations of Europe and the west. The campaign to eat healthy to improve the quality of life and lessen the strain on the health service in the UK and elsewhere, has been usurped by the combined effortsof the food industry.

This industry now packages and advertises supposedly healthy foods, which in fact are not. Instead of creating healthy foods, they have in the main kept the fat, salt, sugar and bulking content of foods high and added a sprinkling of vegetable matter, fruit or nuts. They then re-focussed their packaging and advertising on the added elements.

So under capitalist food production,  trying to eat ‘healthy’ means people can still get significantly overweight! The food industry in the EEC, for example, spent 1 billion Euro’s on campaigning against legislation on clearer packaging information.

As well as taking peoples, jobs, houses, reducing their pensions and benefits, the capitalist system is simultaneously reducing ordinary people’s health and longevity – all in the pursuit of profit. In this way capitalism shows itself as not only economically bankrupt it is also morally, not to mention ecologically bankrupt.

Finally, it is worth remembering, as California demonstrates, that it is possible to declare a state or a country bankrupt. By doing this it is possible to refuse to pay the onerous and odious debts incurred by the political management who incurred them. So when things get bad enough and a government representing the interests of the bulk of the population, rather than the 1%, finally comes to power, (in whatever capitalist country) then this option should be quickly implemented.

The next day, if not the day before, the speculative financial sector should be closed down and the previous politicians banned from holding office again. That way the main people who will suffer from this drastic action will be those who caused the problem in the first place.

The above actions would make a good starting point before removing economic activity from the control of the rich and placing it in the hands of those who operate its various sectors. This would also allow decisions on what and how things should be produced and serviced to be based on decisions other than profit for the few. Radically reducing the hours of work would allow those not employed to take their place in the economic and social activity of the population.

Before all that can happen however, ordinary people’s existence will have to get sufficiently arduous for enough of them to not want to (or be able to) continue in the same old way and to start to consider alternatives to the current system. Another world is possible, but not until the present one is overthrown. In the meantime, it is the defensive struggle which face most of us, but even in these we should be pointing out –

‘capitalism is bankrupt – but our communities remain sound!’

Roy Ratcliffe (July 2012.)

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BANKERS AND THEIR BUDDIES!

Posted on July 6, 2012 by stutteringsteps

The latest revelations concerning the deceitful manipulation of the inter-bank (Libor) interest rates and the miss-selling of onerous interest-hedging policies to small businesses, comes in the wake of a list of other dodgy practices by Barclays International Bank.

But aggressive tax avoidance, outrageous bonuses and unwarranted high salaries are not exclusive to the institutional ’culture’ of Barclays. It extends throughout the whole of the banking system and on into the financial institutions in the ’City of London’ and the spiders web of global financial Markets emanating from the joint Anglo-Saxon finance network of the City of London and Wall Street.

The junior partners of this network in Europe and the other financial districts of the global network of capitalism are also up to their elbows in similar graft. Currently over 20 other institutions are under investigation and even this high number represents only the tip of the total finance-capital malpractice ice-berg.

Much of the speculation and losses – yet to surface – are currently hidden below the murky waters of ‘off-books’ and ‘under the counter’ transactions, which are glossed over by their institutional accountants and publicity departments.

It is this murky world which is unlikely to be revealed by the current – and future – governmental sponsored enquiries into the banking and financial sector. For it is well known that politicians receive substantial campaign donations from their pals in the banking and financial sector. Most right-wing and other politicians in Europe, the UK and the US are akin to ’pimps’ of the economic and financial elites. It is perhaps a little exaggeration to say that any investigation by politicians into banking practices is the social equivalent of drug overlords being investigated by their street dealers. Hyperbole yes – but not too far off I suggest.

Politicians start the blame game.

So now that it has become impossible for the political and financial elite to deny that the entire economic, financial and political system – on a global scale – is rapidly unravelling, we are now witnessing the blame game in full swing. Blaming the victims – the average mortgage holders and credit card owners – has been tried and has largely failed. It is now the turn of a few so-called ‘rogue traders’ and senior managers to have the spotlight turned on them.

In the hope that the public will swallow the flimsy logic that a few greedy or careless individuals can bring the whole global financial system crashing about our ears, these scapegoats are now being sequentially identified. It is true a number of individuals have behaved recklessly and greedily but they could only do so as long as greed and recklessness in banking was possible and that there were (and are) sufficient incentives to fuel greed and take risks.

Even so this particular fact cannot explain the near total ‘collapse’ of the entire global economic and financial system. There are significant structural changes to capitalism that are being ignored. [See ‘Capital and Crisis’ above and ‘Workers and others in the 21st century‘ at Greater Manchester anti-capitalists blog]

Within political circles the blame game is being fought out on the terrain of who was in government during 2005 – 2008 – the earlier period of this intensifying crisis. Yet it is clear that governments – of all political persuasions – during that period and before, were complicit in allowing the situation to develop as it did. Of course, the real economic, financial problem lies in the capitalist mode of production which has a cycle of over-production – crisis – stagnation – before starting the whole cycle again.

However, the size and extent of the regular systemic crisis can be amplified by the actions of those in the financial and political elite. In the case of the current derivative-driven financial crisis the root cause can be traced to the de-regulation policies of the 1970’s under the dynamic duo of Margaret Thatcher (elected 1979) in the UK and Ronald Reagan (elected 1980) in the US.

Spurred on by right-wing intellectuals such as Friedrick Hayak, Milton Fiedman, Arthur Laffer in the US and Sir Keith Joseph in the UK, they introduced a neo-liberal programme of sustained de-regulation. This became the new mantra and de-regulation was continued by Bill Clinton’s administration in the US and the Blairite Labour politicians in the UK.

The Gramm-Leech-Bliley Act (Financial Services Modernisation Act) led the way in the US with similar de-regulation activities in the UK. In retrospect, the Commodities Futures Modernisation Act (CFMA) in the US and the Financial Services Act in the UK, can be viewed as further signposts along the path to speculation and eventual collapse. But this view was available not only in retrospect. Among many commentators, the alarm bells were already ringing at the time of such ‘innovations’.

The military-industrial system has a rotten heart.

In some rare critical words, the UK Financial Times editorial of June 29 (2012) said this whole episode exposes; “…the rotten heart of the financial system.” Indeed it does! The same editorial thought that such ‘confidence tricks’ were ‘damaging the reputation of capitalism‘. They neglected to add that ‘sovereign debt‘, illegal wars, ecological destruction, poverty and a host of other symptoms caused by capitalism were damaging its image. This outburst by the Financial Times explains the anger of one section of the capitalist class against another.

The capitalist class and their supporters are only against exploitation and deceitful dodgy practices, in two particular sets of circumstances. The first is if those practices effect their own parasitic share of the intense exploitation which is the basis of capitalism. The second instance is when the normally hidden dodgy practices come to light and embarrass them or as the Financial Times expresses it ‘damages the reputation’ of their system.

The US, UK and European elite are now deep into damage limitation mode. The capitalist and pro-capitalists are trying to pin the blame on a few scapegoats rather than the system itself. Another victim of the blame game is a lax system of oversight and regulation of the bankers.

Both targets avoid an examination and the questioning of the entire systemic nature of finance capital risk-taking and speculation. However, in one sense the ‘lax regulation’ unwittingly hints at the systemic nature of the crisis.. This is because blaming the regulators is a de-facto admission that the system is so corrupt that it needs regulation – and further strong regulation at that.

It should come as no surprise that this blame avoidance strategy and the symptom of being in denial is the preferred response of the pro-capitalist economic, political and intellectual elites, for they all benefit in one way or another from the existing system. So there will be much debate and discussion on how and in what manner to sacrifice these scapegoats and improve regulation in order to then carry on with business as usual.

It has moved on from wagging fingers and tut-tutting and now carefully controlled and staged ‘enquiries’ along with a few ‘retirements’ and dismissals are the new stop-gap responses. In the UK, criminal investigations are also creaking into low gear as a way of neutralising or appeasing public anger.

Taking responsibility.

Representing the conservative political elite in the UK, Cameron declared recently (June 25 – 29) that “people have to take responsibility for their actions“. Indeed, they should and effective punishment should follow that. But this statement, and other similar ones across the political spectrum, conveniently avoid the question of taking responsibility for one’s – inactions. If warnings are repeatedly given and ignored with damaging consequences, then a serious responsibility would fall on those in responsible positions who ignored the warnings.

The political and educated class, particularly the elite of all political parties, Labour, Conservative and Liberal in the UK, Democratic and Republican in the US have been given repeated warnings of the nature of the capitalist system and in particular the finance capital sector. Any sensible university economics course, which most of them will have taken at one time or another, will have covered Adam Smith, Ricardo and Karl Marx.

All of the above political economists warned of the cyclical nature, the structural crisis and fraudulent practices of the economic system driven by capital. Any political or economic course, designed for future ’leaders’ who chose to ignore the above three radical economists could have hardly avoided Keynes, the ‘moderate’ economist who stated;

“Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes the by-product of the activities of a casino, the job is likely to be ill done.“ (John Maynard Keynes. ‘The General Theory of Interest and Money’. Page 159.)

Of course they could have forgotten or ignored such pertinent observations by a pro-capitalist economist of the 1930’s who had seen first hand the results of the last great structural crisis after the Wall Street Crash of 1929. But then how can we explain why the warning given all through the 1980’s, 1990’s and 2000’s by high-profile people – and others – in the wake of the speculative collapses of American, Japanese and Irish Banks of those decades, was ignored?

Or how can the fact of ignoring even the more recent and numerous academic warnings in the wake of the Northern Rock, Lehman Bros and assorted other banks collapses in 2008 be explained? These were collapses in the system, which the political class chose to ’rescue’ after these banks had indulged in even more uncontrolled bouts of speculation. To be kind there can only be one conclusion – disaster myopia! More bluntly – it clearly benefited them for a time to turn a wilful blind eye.

The fact is the political class, along with the national and local state officials, the Bankers and the financial speculators are all culpable in one form or another. Predictably all will find some excuse to minimise the blame and place it elsewhere than where it really belongs. The Leveson enquiry in the UK recently demonstrated how the political class are never able to remember doing anything which might implicate them personally in any clearly indicated wrong-doing.

However, the rapidly accumulating record suggests that the International political class and the capitalist financial elite can only escape their own complicity and responsibility for the mess we are in, as long as the rest of us, by support, naivety or indifference, allow ourselves to be fobbed off and then distracted by one means or another.

Saving the system or changing it.

Meanwhile it should be obvious that any rational capitalist government in this crisis situation would fully nationalise the banks, refuse to honour the accumulated speculative debts, sack and prosecute all the senior staff, close down the ‘casino’ banking sector and bonus culture, which drives speculation and put the new ‘managers’ under strict regulatory control.

This will not happen in the short term however, since as the expenses scandal in the UK indicated, the pro-capitalist politicians are as corrupt and fraudulent as their ‘buddies’ in banking. However, some further forms of ‘nationalisation’ may yet have to be done as the bond-holders interests serve to deepen the crisis. If the ATM’s are eventually shut down and the banks close as they did in Argentina in 2000 to save the system from itself, this may prove a necessary stabilising step.

In contrast, any anti-capitalist inclined governmental power would have to go much further than this bourgeois solution and ‘socialise’ the banks, close down all speculative investment activities, place bank functions under the ‘direct’ control of ordinary bank staff and local customers with elected supervisory staff on ‘reasonable’ salaries. Only such a course of action, along with other revolutionary transformations, such as rejecting the ‘odious debts‘, taking production out of the control of private capital and taking democracy out of the hands of a professional elite, would create a serious improvement for humanity on the existing lying, cheating, ecology-destroying capitalist ‘rip-off’ system.

Roy Ratcliffe. (July 2012)

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MARX AND ‘THE MUCK OF AGES’

Posted on July 3, 2012 by stutteringsteps

This article is another in the series which is aimed a encouraging modern anti-capitalists to engage with the authentic revolutionary-humanist understandings of Karl Marx. Simply accepting the abstractions and assertions of the numerous varieties of so-called ’Marxists‘ at their face value, will not provide a reliable guide, to either the tradition initiated by Marx, nor to a correct anti-capitalist orientation in the coming class struggles. [For further remarks on the discrepancy between Marxism and Marx, see ‘Marxism versus Marx’ or by clicking on that title on the above black banner.]

The ‘muck of ages’ in the title of this article relates to a passage from one of Marx’s early works in the 19th century. It is a extract which if seriously considered clearly identifies the difference between Marx and many other revolutionary anti-capitalists of that important period. It also contains a proposition of general importance and of increasing relevance as the 21st century crisis of capitalism deepens. It is contained within a section of the German Ideology.

“..the alteration of men on a mass scale is necessary, an alteration which can only take place in a practical movement, a revolution: the revolution is necessary, therefore, not only because the ruling class cannot be overthrown in any other way, but also because the class overthrowing it can only in a revolution succeed in ridding itself of all the muck of ages and become fitted to found society anew.” (Marx. German Ideology. Coll. Wks Vol. 5 page 53.)

It is tempting to focus on the second proposition within that sentence relating to the necessity of revolution; i.e. the part which includes – ‘because the ruling class cannot be overthrown in any other way’. This proposition has been proven by the last 100 years or so during which people have repeatedly attempted to reform capitalism and appealed to the humanity of the capitalist class to end their war against the oppressed – to no avail!

However, the two propositions which follow; “the alteration of men” and “because the class overthrowing it can only in a revolution succeed in ridding itself of the muck of ages and become fit to found society anew.” are the ones which should now be carefully considered.

It is important to understand what Marx really getting at in those second and third, crucially important propositions. I suggest this is best tackled by reflecting on what kind of ‘alteration’ and what the ‘muck of ages’ he might have been referring to. We could, also ask ourselves what kind of ‘alteration‘ and ‘muck’ would a class need to undergo and be rid of in order to be ‘fit to found society anew’?

These questions can be approached from a number of angles, but a good one to start with would be to consider at least one of Marx’s fundamental starting points. As he stated also in the German Ideology;

“The first premise of all human history is, of course, the existence of living human individuals.” (Marx. German Ideology)

Note that Marx’s starting premise for his various studies is not tribes, classes, genders, races, nations, religions, political sects or any other form of partial or local identity. Marx commences with regard to the problems facing humanity as a whole. Very early on he concluded that the economic logic of capitalism was to connect up the world – economically – and therefore, to some extent socially. When he arrived at the conclusion that a post-capitalist form of society was necessary, he saw it as necessary – for the species as a whole! Thus using the vocabulary of the 19th century he noted;

“This communism, as fully developed naturalism, equals humanism, and as fully developed humanism, equals naturalism; it is the genuine resolution of the conflict between man and nature and man and man. – the true resolution of the strife between existence and essence….between the individual and the species.” (Marx. Economic and Philosophical Manuscripts of 1844.)

Despite the now sinister association of the term ‘communism‘, what Marx is concerned with, every humane person should be at one with. Unlike the authoritarian Bolsheviks and others, he considered a post-capitalist society would allow a genuine and humane resolution of the conflict between man and nature and between the various historic divisions of humanity.

Marx’s revolutionary-humanism looked forward to the return of humanity ‘from religion, family, state etc., to his human, ie social existence‘ (ibid). In the 19th century, Marx brought to the economic, social and political spheres of study, the biological understanding that – above all else – humanity is one species. And unlike utopian and religious views he gave this perspective a firm material basis.

An important part of the muck of ages Marx refers to are, I suggest, all those racist, sexist, ageist, nationalist, and sectarian sub-species identities and their attendant animosities, currently distorting our actual and potential social existence. These inherited identities reflect past prejudices and are more often than not, deliberately manipulated to increase the strife between individual members of our species.

Throughout history there has developed a division between our ‘essence’ as human beings and the identities adopted. Divisions have occurred which have distorted this essence, into historically determined tribal, national, religious and other forms of contemporary existence – with their aggressive antagonisms.

Recognising this resolution could not be fully possible, whilst the world and its resources was divided up and controlled by ruling elites, Marx nevertheless argued that in order to reconstitute a society of the future, the modern class which represents that future will need to rid itself of this accumulated muck.

However, whilst that may not be fully possible under the present alienated and distorted social existence of capitalism, getting rid of this ‘muck’ it is at least partially possible. I further suggest this process is essential for those who, in advance of a revolutionary transformation, adopt a revolutionary-humanist position and seek to assist this development.

Yet it is a fact that since the 19th century, the divisive identities have continued. Indeed, the accelerated human alienation brought about by the development of neo-liberal global capital during the 20th and 21st centuries has caused a general reactionary search for earlier or even new forms of specific identity which serve to hide, disguise or negate the essence of the human species.

Despite an abstract recognition at a rhetorical level, of equality for all, there has been a search for and adoption of primary identities in nation, ethnicity, gender, sexual orientation, religion, politics and even localised football teams. Each of these introspective identities carries within it assertive and even aggressive forms of ideology and conduct which asserts not just primary rights in competition with other identities but superior rights in pursuit of which atrocities of all kinds are perpetrated.

In representing the future, it is generally accepted – within the ranks of revolutionary anti-capitalist workers – that there should be a consistent challenging and erosion of sexism and racism. But in truly representing the future there should also be much more. The revolutionary-humanist perspective of Marx suggests that any elevation of tribal, national, gender, religious, age, sectarian or other forms of identity, over that of human being is reactionary.

If the call for ‘workers of the world to unite’, is not to remain a sterile abstraction, it means workers overcoming this particular ‘muck of ages’ in their revolutionary practice. And if this is the case for workers in general, how much more so should it be within the ranks of those revolutionary anti-capitalists who seek now to play a positive role in that process

Yet as we know, within those anti-capitalist ranks, the most aggressive (occasionally violent), competitive forms of sectarian divisions have taken place and continue to be effective barriers to solidarity. These divisions have not been primarily created around ethnicity, nationality, religion, gender etc., but around ideology.

Most, if not all anti-capitalist sects, have a set of principles and an interpretation of these principles, which they use to distinguish themselves, not only from the working and oppressed classes, but from each other. This practice started, whilst Marx was alive, but really became accelerated and solidified under the later impact of Bolshevism, before becoming an embedded part of the now atrophying heritage industry of the Leninists, Stalinists, Trotskyists and Maoists.

Having different understandings and views is part of being human. For many people, so too is having principles. However, in general, non-sectarian working people will support each other when possible even though they have different views. Not so the sectarians. Sectarian anti-capitalists will not only refuse to help other disagreeing anti-capitalists, but will disrespect them, positively stand in their way, character assassinate them and even in the past have physically assassinated them.

Most, if not all, of the above noted sectarian anti-capitalists take their ‘principles’ to the masses and other anti-capitalists. These principles and views are presented to them in the hope of their acceptance. If the workers or other anti-capitalists reject them they are considered backward, ignorant or deluded, with all this implies. This occurs despite Marx’s suggestion in the Communist Manifesto and elsewhere, that this sectarian posturing is a sterile, useless and counter-productive activity.

Among revolutionary-humanists in the tradition of Karl Marx, however, principles are not taken to the class struggle and life, but derived from it. Solidarity is also extended to all those in struggle against capital and its symptoms even if they differ in opinions or tactics. Engels, Marx’s friend and collaborator made the first point clearly and succinctly.

“…the principles are not the starting point of the investigation, but its final result; they are not applied to Nature and human history, but abstracted from them; it is not Nature and the realm of humanity which conform to these principles, but the principles are only valid in so far as they are in conformity with Nature and history. (Engels Anti-Duhring. )

The last phrase has particular relevance with regard to the state of the revolutionary, anti-capitalist left in the 21st century. Their principles are only valid insofar as they are in conformity with nature and history. The main principles by which sectarians operate are embodied in their dogma and elitism, and are neither in conformity with nature nor history. Indeed, seen from outside their ranks and from the standpoint of Marx, sectarianism is clearly a part of the ‘muck of ages’ and needs to be got rid of among those who wish to assist the struggle against capital.

[see also ‘Sectarianism and the question of a General Strike’  and ‘Clinging onto Patriarchy’ ]

]Roy Ratcliffe (June 2012)

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