RE: capitalism's expansion vs. limits
Jim Devine that eternal chestnut, the we're running out of oil theory This 'eternal chestnut' dates back at least to Marx himself, to Liebig, Jevons and others who first talked about resource limits, including both fossil energy and soil fertility. The problem has hardly gone away. Another reputable scientist, the petrogeologist M King Hubbert warned as long ago as 1956 that US oil would start to run out in 1970. It did. Lower 48 oil production peaked that year and US production is now half what it was then. Hubbert also predicted that world oil would peak around the year 2000. Certainly world energy per capita already has peaked. Some argue that world oil has now peaked. If Hubbert is right, the decline will mean that oil and gas will fall by half in the next 50 years. That will mean the end of capitalist economy, pace some as yet unknown act of final ingenuity. It is common to say that the streets of major cities were full of horse shit, but hey! the automobile came along. The automobile, however, was already invented. Anything which you rely onto to overcome a major crisis must already exist on someone's drawing board. But there is no evidence at all of any single technology or complex of technologies capable of subtituting for the myriad energy and feedstock uses of petroleum. On the contrary, our dependence on oil and gas both as prime movers and as irreplaceable raw materials is still growing. Meanwhile we are collectively forgetting most of the ways of making and doing things by others means, using other materials. It is therefore already too late to stave off crisis, and that's in fact why the world elites are now and have been for years already, in crisis-management mode. From the Balkns to Turkey to the Caspian, from the Arctic to the Gulf of Mexico, a desperate hunt for hydrocarbons is on and the geopolitics of these areas are being remodelled at lightning speed and in conditions of chronic crisis. Those who blame the priests for the eclipse will get the eclipse anyway. As Trotsky might have said, you may not be interested in energy crisis but it is interested in you. 'Old chestnuts' take a long time to turn into trees, but they do in the end. Mark Jones
Re: RE: Re: Current implications for South Africa
From: Mark Jones [EMAIL PROTECTED] Date: Fri, 22 Jun 2001 18:28:35 +0100 Do you even acknowledge as a problem, the global endemic energy scarcity which has seen per capita energy consumption stagnant since 1973 and which is a very real problem precisely in those newly neoliberalised zones (S America, E Europe, S Africa) which now suffer chronic energy shortages (gasoline famines, brownouts etc) and which cannot hope to find the capital to invest in new infrastructure? Minor correction from sooty Jo'burg, comrade, where there's still a quarter excess electricity generating capacity, even on a cold winter day like today... (Sunday Independent, 27 July 1999) Power to the powerful: Ideology of apartheid energy still distorts electricity sector by Patrick Bond South Africa's surreal energy problems reflect the kinds of contradictions you would expect during a transition from apartheid economic history to a contemporary electricity pricing system all too often based on (`neoliberal') market-policy for households, complicated by massive subsidies for big corporations, in one of the world's most unequal societies. There are at least three world-class development disasters here: our economy's skewed over-reliance on (and oversupply of) pollution-causing, coal-generated electricity; the lack of equitable access amongst households along class/race lines (with serious adverse gender implications); and periodic township rioting associated with power cuts resulting from nonpayment. Plenty of other challenges for a revitalised energy policy could be mentioned. But assuming Minister Phumzile Mlambo-Ngcuka wants justice to be done during the ANC's second term (and is less distracted by shady Liberian consultants or groundless attacks on the auditor general than her predecessor), merely addressing electricity distribution would require a serious challenge to corporate power and neoliberal ideology. Instead of praising the filthy rich (who can forget?), the minister would have to subsidise filthy impoverished townships currently suffocating under winter coal fumes. An outstanding recent book, The Political Economy of South Africa by Ben Fine and Zav Rustomjee, puts this sector into economic perspective. Here we locate electricity at the heart of the economy's `Minerals- Energy Complex,' a `system of accumulation' unique to this country. Mining, petro-chemicals, metals and related activities which historically accounted for around a quarter of economic activity typically consumed 40 percent of all electricity. Thus Eskom was centrally responsible for South Africa's economic growth, but, Fine and Rustomjee show, at the same time fostered a debilitating dependence on the (declining) mining industry. Economists refer to this as a `Dutch disease,' in memory of the damage done to Holland's economic balance by its cheap North Sea oil. South African electricity consumption (per capita) soared to a level similar to Britain, even though black--`African'--South Africans were denied domestic electricity for decades. To accomplish this feat, Eskom had to generate emissions of greenhouse gasses twice as high per capita as the rest of the world, alongside enormous surface water pollution, bucketing acid rain and dreadfully low safety/health standards for coal miners. To what end? Today, most low-income South Africans still rely for a large part of their lighting, cooking and heating energy needs upon paraffin (with its burn-related health risks), coal (with high levels of domestic and township-wide air pollution) and wood (with dire consequences for deforestation). Women, traditionally responsible for managing the home, are more affected by the high cost of electricity and spend far more time and energy searching for alternative energy. Ecologically-sensitive energy sources--such as solar, wind and tidal--have barely begun to be explored, while the few hydropower plants (especially in neighbouring Mozambique) are based on controversial large dams that, experts argue, do more harm than developmental good. Some inherited electricity dilemmas stem from a racist, irrational and socially-unjust history. Conventional wisdom even before 1948, we must never forget, was that `temporary sojourners' were in cities merely to work; they would not consume much-- certainly not household appliances--since their wages were pitiably low. As Jubilee 2000 South Africa observes with justifiable bitterness, more than half of the World Bank's $200+ million in apartheid credits from 1951-66 were for Eskom's expansion, including coal-powered stations. But none of the benefits found their way to the homes of the majority of citizens. Even by 1994, fewer than four in ten African households had electricity. Meanwhile, corporate South Africa suffered the opposite problem--an embarrassment of energy riches-- especially when terribly poor planning
Re: Re: Current implications for South Africa
Date: Fri, 22 Jun 2001 17:11:38 -0400 From: Yoshie Furuhashi [EMAIL PROTECTED] The expansion of mass consumption regional linkages (in opposition to elite consumption subordination to financial centers) under the Bond program (if ever implemented -- but who bells the cat?) can presumably overcome the tendency to overaccumulation inherent in capitalism in a fashion unlike neoliberalism, while creating the politico-economic foundation for a future socialist transformation (should an opportunity ever arise). Actually I wouldn't be so confident. The early 1990s Growth Through Redistribution argument (e.g. of Lawrence Harris when he was still a marxist and Ben Fine) was very compelling but still didn't come to grips with either the need for a major insurgency to dramatically shift power relations, or the quarter-century context of overcapacity in luxury goods and heavy industries (e.g. excess electricity generation capacity I already mentioned) that still bugger this economy, even 12 years after neoliberal restructuring began. A decade ago I was sceptical of the GTR approach, which in any case morphed into a neolib-friendly post-Fordist strategy of progressive competitiveness (a miserable, job-killing failure brought to us by the ex-syndicalist trade/industry minister, Alec Erwin, who was also recently president of Unctad). Here's the relevant caveat: Could the Growth Through Redistribution strategy work? The answer has much to do with the *expectations* of ANC members and supporters. Business and many liberal whites fear that poor and working people's expectations will be out of all proportion to the resources available. In the Zimbabwean experience, civil society was so poorly organised that expectations and popular demands were not taken seriously by the government after liberation. The lack of grassroots pressure permitted economic power to remain in the hands of a few whites, international financiers, and a small but important black bureaucratic class... Some members of Cosatu's Economic Trends group refer to Growth Through Redistribution as a second best scenario: if socialism is not on the agenda, it is at least a useful task for ex-Marxist economists to set out how capitalism can achieve growth and at the same time provide for more basic human needs than before. But this pessimism is unwarranted if a different understanding of the crisis--that is of overaccumulation--is built into the analysis of how to restructure the economy. Such an analysis can be empowering, not disempowering, if it rests on real struggles of activists and a sense of the chaos that the crisis has produced within the commanding heights... No matter how progressive their goals and policy statements, ANC and Cosatu economists have basically accepted the constraints of the overaccumulation crisis as inevitable, and have tried to construct an alternative economic strategy *around them.*.. In these respects, a reformist post-apartheid economic programme will leave many people from all walks of life severely disappointed. At core, ANC and Cosatu post-apartheid economic policy has failed to identify how the overaccumulation crisis creates new possibilities, especially for disciplining the power of high finance. (from Commanding Heights and Community Control, Johannesburg, Ravan, 1991, pp.67-68.) My post concerns what I take to be the Bond program for the periphery, so I don't take credit for it. Hey comrade Yoshie, I like what you wrote below much better. Can I call this the Bond Programme? :-) Date: Fri, 22 Jun 2001 18:25:46 -0400 From: Yoshie Furuhashi [EMAIL PROTECTED] Since the neoliberal solution included debt deflation deindustrialization in the South the East, naturally we want to reverse them, thereby stopping massive capital outflows from the South the East to the North which has helped the ruling class. Ok I'll give a taste of the ongoing Zimbabwe debate on how to take forward Mugabe's $5 billion foreign-debt payment-standstill, towards repudiation, in the next post... In the North as well, the working class need to learn to demand more of all goods: higher wages, more free time, more social programs, more environmental cleanups, etc. The job of the working class, in the North or South or East, in short is to demand more, not because doing so is a viable long-term goal under capitalism, but precisely because it isn't. The more the working class organize themselves to make demands energetically, the more likely capitalism enters into another serious crisis -- in other words, the working class, by organized demands, must create a crisis turn it into its favor (= an opportunity to fight for socialism from the position of strength). That's absolutely the right principle. It's happening in
Re: capitalism's expansion vs. limits
Date: Fri, 22 Jun 2001 14:23:18 -0700 From: Michael Perelman [EMAIL PROTECTED] I don't know what the biggest risk is for capitalism: Third World upheavals, financial implosion, global warming, overcapacity, or resource constraints. I think it would be very useful to think about how these various forces relate to each other. Let's say, these crisis-symptoms all occur in a more amplified form because of, at root, the tendencies of overaccumulation/unevenness, right? I think the merits of my PhD advisor David Harvey's work (e.g. the newly reissued Limits to Capital) is the focus on the role of finance in crisis-displacement, and geopolitical processes that logically follow. (Finance displaces overaccumulated capital across time throught the credit mechanism--allowing consumption now, surplus extraction to pay for it later--and finance moves money across the world in a twinkling of an eye, so the geographical devalorisation can occur wherever resistance is weakest.) A few more words on Jim's post, and then I ask comrades to help us on some Zimbabwe deliberations. Date: Fri, 22 Jun 2001 18:19:57 -0700 From: Jim Devine [EMAIL PROTECTED] Unfortunately for Marx, his volume III theory of the rising organic composition of capital doesn't work very well on either a theoretical or a practical level. Not only can the capitalists compensate for any rise in the organic composition of capital by cutting wages relative to productivity (raising the rate of surplus-value), Jim, there are always countervailing tendencies (absolute/relative s.v. extraction), of which I think the most important since the current int'l slowdown in accumulation began three decades or so ago, has been the temporal/spatial *displacement* of the devalorisation of overaccumuled capital. Third World lending has been one vehicle (even if not, in the whole scheme of things, a particularly large one in volume terms... but we've really felt it down here!). Consider, for instance, the Suter/Eichengreen studies of financial crashes: every 50 years like clockwork since 1820s, involving 1/3 of all nation-states (the WB's 2000 Global Finance report actually promotes the financial-Kwave theory, I guess because Stiglitz still had his hand in and Eichengreen refused to draw the logical conclusions). It seems that the big difference during the 1980s was the concentrated power of the WB/IMF--as cops for NY/London/Frankfurt banks--to NOT ALLOW the devalorisation of financial capital by instead rescheduling debt (Nyerere and Castro failed to get the debtors' cartel up and running). But the point here is that this process of displacing the overaccumulation crisis South didn't solve it. Racing to repay unpayable debt, the Third World glutted most raw material and light mfg. markets. So the displacement -- the recent spatio-temporal countervailing tendencies Marx did not really foresee or theorise -- simply means that the overaccumulation problem grows worse, right? but any crisis that occurs purges imbalances from the system, destroying capital and allowing accumulation to recover -- to drive itself into crisis once again. A matter of the balance of class forces, right? Including territorial struggles? So, that's why helping to more surgically identify the pockets of resistance and empower them--instead of comrade Chris' utopian global-regulatory strategy--becomes ever more crucial. To link the pockets of resistance obviously also calls for the need for solidarity--the globalisation of people (not of capital or state functions, which will overwhelm us if they maintain their current international capacities, without nation-states reigning in capital, e.g., through a new round of exchange controls). Even this doesn't inevitably lead to capitalism's demise. Instead, it encourages collective solutions, i.e., the monopolization of markets and the rise in the role of the state. The last time capitalism had a gigantic Crisis -- the 1930s -- it encouraged the rise of state solutions, from social democracy to fascism, with the U.S. New Deal in the middle, on a national level. The next Crisis will likely see its solution on the global level, as seen in embryonic form in the Kyoto accords. (Somehow, the Bushwackers aren't anti-abortion on _this_ issue.) If the current US slowdown turns into a global depression, it encourages further development of collective control, perhaps the creation of a global Fed. Human ingenuity would show up in the form of a New Bretton Woods conference, a global-statist version of social democracy or fascism or something in-between. This eventually would allow the re-establishment of capitalist accumulation Why are you so sure, comrade Jim, about global solutions (restructuring of relations of production)? The old familiar intercapitalist-competition plus bloc-formation process plus geo-military conflict
Pacifica and the FBI
From Pacifica historian Matthew Lasar... === To: Ken Ford, Pacifica Foundation Re: The Federal Bureau of Investigation June 23, 2001 A message has come to my attention, purporting to come from you, in which you ask members of the Pacifica Governing Board to send what they experience as distressing listener e-mails to your offices. You, if I understand this message correctly, may then forward these documents to the Federal Bureau of Investigation (FBI). They may then form the basis of a Racketeering in Corrupt Organizations (RICO) suit against various Pacifica reform groups or individuals that you do not like. Mr. Ford, nothing would give me greater pleasure than to learn that this e-mail (enclosed below) is a fake and that I am the gullible victim of a clever Internet hoax. But if the message is real, I am very alarmed and implore you to reconsider acting on it. I understand that you do not enjoy being called upon to resign by thousands of people across the United States. Since I am familiar with Pacifica, I know that some of these messages may be rude. But inviting the FBI into this situation puts the organization that you represent in great danger. If the Pacifica radio network has a natural predator, it is the FBI. In the early 1980s Pacifica obtained the network's Freedom of Information Act FBI files. I urge you to read these documents, which about six years ago I filed and sorted as volunteer archivist for the Pacifica National Office Papers. Since the 1950s, the Bureau has been poking, prodding, invading, infiltrating and harassing this organization in the most irresponsible and aggressive ways. It has planted informers within the network, sent agents pretending to be private citizens to inquire about the organization, and far worse. In 1962, two staff members at WBAI in New York City interviewed a former FBI trainee about his experiences at the Bureau, and prepared to put his comments on the air in late October. After reading internal Bureau files during this period, I concluded that the FBI got wind of this program through a highly placed informer at KPFA in Berkeley (I do not know the identity of this person). Although Pacifica governing board members offered the FBI equal time to respond to the trainee's charges, the Bureau opted instead to begin a reckless campaign of harassment, including visits to staff members' homes, hostile anonymous phone calls, and threats of a raid at WBAI if the program was aired. When WBAI broadcast the program anyway, the Bureau dossiered everyone of consequence within the Pacifica network, and forwarded its encyclopedia to the Senate Internal Security Subcommittee (SISS) and Federal Communications Commission (FCC). The SISS used the materials to subpoena and grill about 8 members of the National Board in hearings in Washington, D.C., then released transcripts of the hearings to a hostile press. The FCC, under the guidance of a former FBI agent who now served as a Commissioner, withheld Pacifica's licenses and demanded loyalty oaths. Even after the network survived this ordeal, which it did barely, the FBI continued to worm its way into and around the organization. Do you imagine that Pacifica no longer broadcasts programming that displeases the FBI? Quite the contrary; in fact, some of Pacifica's most prominent programmers have, very recently, published books exposing the FBI's unethical activities. Through the 1970s, 1980s and to varying degrees still, the organization functions as a clearing house for the conclusions of every radical investigative journalist in the country. In the 1980s, during the Iran-Contra scandal, no network publicized the machinations of former FBI director William Casey more thoroughly than Pacifica. Surely the FBI hates Pacifica radio. Do you really believe that if you invite the Bureau into the internal life of Pacifica, its operatives will narrowly adhere to the tasks you set before them, and meekly depart from the scene upon your command? This is the FBI, I remind you, that recently withheld information about the Timothy McVeigh case and put Wen Ho Lee in solitary confinement for a year. This week the newspapers report on an FBI operative who allegedly sold information to organized crime for tens of thousands of dollars. Unmanageable, unaccountable and unreliable, a United States Senator called the FBI on Thursday during a Congressional hearing about the Bureau. If you actually plan to bring the FBI to this situation, do you think that it will remain under your control? Up until this month you were toying with a small but precious radio network; at that point you will be playing with fire. The question is, do you care? Mr. Ford, I don't know you. I do know that if you do not publicly repudiate this extremely ill-advised recourse, it is only further evidence of your lack of qualifications to have anything to do with the governance of this network. In any event, if the FBI calls me for any
Re: Re: Hi Michael.. Please post this. Thanks alot.
Thanks Michael. I'm on the list, though a silent member.
Hardt-Negri's Empire: a Marxist critique, part two
Part two of Hardt-Negri's Empire is a rather lofty defense of an argument that has been around on the left for a long time. It states that all nationalism is reactionary, both that of oppressor and oppressed nations. While the argumentation is studded with references to obscure and not so obscure political theorists going back to the Roman Empire, there is a complete absence of the one criterion that distinguishes Marxism from competitive schools of thought, namely class. Key to their stratagem is a reliance on the Karl Marx India articles that appeared in the New York Tribune in 1853. Putting this defense of British colonialism into the foreground helps shroud their arguments in Marxist orthodoxy. In effect, the Karl Marx of the Tribune articles becomes a kind of St. John the Baptist to their messianic arrival: In the nineteenth century Karl Marx...recognized the utopian potential of the ever-increasing processes of global interaction and communication. (Empire, p. 118) In contrast to the bioregionalist pleas of anti-globalization activist Vandana Shiva, perhaps the best thing that could have happen to India is deeper penetration by the WTO, based on this citation from Marx that appears in Empire: Sickening as it must be to human feeling to witness, we must not forget that these idyllic village communities, inoffensive though they may appear, had always been the solid foundation of Oriental despotism, and they restrained the human mind, within the smallest possible compass, making it the unresisting tool of superstition, enslaving it beneath the traditional rules depriving it of all grandeur and historical energies. It is indeed unfortunate that Hardt and Negri are content to rest on this version of Marx even though they have to admit that he was limited by his scant knowledge of India's past and present. Not to worry, since his lack of information...is not the point. (Empire, p. 120) In other words, this Marx of scanty knowledge fits perfectly into the schema being constructed in Empire since it too is generally characterized by a lack of concrete economic and historical data. As Aijaz Ahmad points out (In Theory, pp 221-242), Marx had exhibited very little interest in India prior to 1853, when the first of the Tribune articles were written. It was the presentation of the East India Company's application for charter renewal to Parliament that gave him the idea of writing about India at all. To prepare for the articles, he read the Parliamentary records and Bernier's Travels. (Bernier was a 17th century writer and medicine man.) So it is fair to say that Marx's views on India were shaped by the contemporary prejudices. More to the point is that Marx had not even drafted the Grundrisse at this point and Capital was years away. On July 22nd, Marx wrote a second article that contains sentiments that Hardt and Negri choose to ignore, even though it is embedded in a defense of British colonialism. In this article, Marx is much less interested in the benefits of global interaction and communication than he is in the prospects of kicking the British out: The Indian will not reap the fruits of the new elements of society scattered among them by the British bourgeoisie, till in Great Britain itself the new ruling classes shall have been supplanted by the industrial proletariat, or till the Hindus themselves shall have grown strong enough to throw off the English yoke altogether. So unless there is social revolution, the English presence in India brings no particular advantage. More to the point, it will bring tremendous suffering. Furthermore, there is evidence that Marx was becoming much more aware of how the imperialist system operated late in life. In a letter to the Russian populist Danielson in 1881, he wrote: In India serious complications, if not a general outbreak, are in store for the British government. What the British take from them annually in the form of rent, dividends for railways useless for the Hindoos, pensions for the military and civil servicemen, for Afghanistan and other wars, etc. etc., -- what they take from them without any equivalent and quite apart from what they appropriate to themselves annually within India, -- speaking only of the commodities that Indians have to gratuitously and annually send over to England -- it amounts to more than the total sum of the income of the 60 million of agricultural and industrial laborers of India. This is a bleeding process with a vengeance. A bleeding process with a vengeance? This obviously does not square with the version of colonialism found in Empire. Within a few years, the Second International would become embroiled in a controversy that pitted Eduard Bernstein against the revolutionary wing of the movement, including British Marxist Belford Bax and Rosa Luxemburg. Using arguments similar to Hardt and Negri's, Bernstein said that colonialism was basically a good thing since it would hasten the process of drawing savages into
Re: Current implications for South Africa
At 23/06/01 07:47 +, Patrick Bond wrote: Date: Fri, 22 Jun 2001 06:32:48 +0100 From: Chris Burford [EMAIL PROTECTED] To what extent is there still relevance in the ANC/SACP concept of the National Democratic Revolution? Concept is great. Problem is, some of the key actors are talk-left, act-right sell-outs. Is there indeed scope for radical democratic initiatives that take the National Democratic Revolution forward and have a socialist content or prepare the ground for socialism? Yes but they're not being supported by the ANC. Clear answers from Patrick. If uneven development on a world scale and within a country like South Africa, runs into crises of accumulation and if these tendencies have intensified with the international dominance of neo-liberalism, does it not suggest that there is a democratic agenda at a global level as well as at the level of individual countries? Yes absolutely, to spin that broken record of mine, the international democratic agenda can only be, in my view (given the existing balance of forces), to rid the world of the most powerful transmission agents of neo-liberalism, especially the WB/IMF/WTO, to give some breathing space to national-scale movements making demands on their nation-states. (We'll agree to disagree Chris.) I welcome Patrick accepting a formula about an international democratic agenda. It is not a disaster if serious people disagree about what that should consist of, providing the options are understood, and debated, and we move forward. To clarify the disagreement one step further in response to Patrick's last post, I would not see neo-liberalism as a policy *transmitted* through the WB/IMF/WTO. (although that certainly occurs and it is absolutely right to campaign against structural adjustment programmes.) Essentially I see the pressure for neo-liberalism being the workings of international (US led) global finance capitalism. It wants the maximum freedom of movement for its interests. The world as a safari park for the giant international corporations. A level playing field for exploitation. A totally free laissez faire market in finance capital means that the fucking bond traders (Clinton) dictate the policies or all governments. Yes, there is something crazy in the most extreme structural adjustment programmes which require destruction of all non-commodity or non-capitalist sectors of domestic economies rather than concentrating on those areas which need to be competitive to earn foreign exchange. But fundamentally the enemy is not a policy: it is the blind workings of global finance capital. That is why we need regulation not de-regulation. This may not come through the reform of Bretton Woods organisations, but it needs to come from somewhere, of a global economy that is a highly complex social structure, but is privately owned by finance capital. Chris Burford London.
Feedback from Jay Moore on Hardt-Negri
I thank Louis for his critique of Empire. I'm glad that he actually made it through -- which I couldn't do because I was so digusted with it both by the more general issues Louis hits on and by its near-total divorce from an examination of the facts on the ground. (Negri may have an excuse since he's been in prison but what about Hardt?) This is supposed to be the Das Kapital for the 21st century? Hah! Compare Marx's richly detailed description taken from the British Blue Books of the disastrous effects of industrial capitalism's rise on the working people in both core and periphery. There's nothing like that whatsoever in Empire. It operates exclusively (except for a paltry few anecdotes) in abstraction. One thing, however, I would say to Louis and others who may be trying to get a fix on where these cats are coming from is that the linchpin for the whole theoretical edifice is Negri's keen interest in Marx's Grundrisse. He wrote a long exigesis of it some years ago when he was associating in France with Althusser's school -- sort of his response to their exigesis of Capital. Much more so than the few short (but much-quoted) articles by Marx about the alleged civilizing effects of British colonialism in India, the Grundrisse (written roughly around the same time period) is chock full of sections that are conducive to that approach (although somewhat more dialectical in Marx's original hands). If you want to pull out the rug from under all of this stuff, that's where you have to go, I think. Good luck. I'm not! best, jay www.neravt.com/left/ Louis Proyect Marxism mailing list: http://www.marxmail.org/
Re: RE: capitalism's expansion vs. limits
I referred to: that eternal chestnut, the we're running out of oil theory Mark Jones says: This 'eternal chestnut' dates back at least to Marx himself, to Liebig, Jevons and others who first talked about resource limits, including both fossil energy and soil fertility. Of course, Ricardo and Malthus were also quite conscious of the natural limits, before Marx or Liebig or Jevons. (Probably Aristotle was too, but I'm not enough of a scholar on that guy.) But it's a mistake to equate the existence of natural limits with running out of oil. The former says that there is something -- e.g., energy received by the Earth from the Sun -- which involves an absolute limit (an ultimately vertical supply curve). The latter says that demand is always going to be increasing faster than supply. It's a basic mistake to jump without reflection from the former to the latter. It's also a mistake to ignore Marx's writings on rent, in volume III of CAPITAL: there he talks about differential rent II and how capitalism encourages technical change which deadens the blow of natural scarcity. He rejects the Ricardian stationary state pretty explicitly in much of his later work. That's why he instead emphasize the _nature_ of the technical change (for him, the rising organic composition of capital) as encouraging economic crisis. The problem has hardly gone away. Another reputable scientist, the petrogeologist M King Hubbert warned as long ago as 1956 that US oil would start to run out in 1970. It did. Lower 48 oil production peaked that year and US production is now half what it was then. Hubbert also predicted that world oil would peak around the year 2000. That's for a specific geographical location (though which location you're talking about is ambiguous, since you jump from the US to the lower 48 states and it's unclear whether or not the second reference to the US includes Alaska or not). New supplies of oil seem to be found in new locations (outside the US) every year. Further, the amount of oil available depends not just on the natural limits on the amount of oil in the ground but also social and technical conditions of oil production. As prices rise (if the price rise is seen as being a permanent rather than a transitory thing), the development of new technologies is encouraged to allow for the pumping of oil from old fields that have been abandoned. When oil prices are high, they even pump oil from the fields near my home (though the place will become a park in a few years). Of course, the supply of oil can also be boosted if we lower ecological standards, which is of course the Cheney-Bush goal. BTW, what does the petrogeological profession as a whole think of Hubbert? what is the professional consensus on his methods and conclusions? why should we believe him rather than others? or is he reputable the way Milton Friedman is? My amateur understanding is that most of the predictions about the limits on the supply of oil (like the ones that show up in SCIENTIFIC AMERICAN every year or two) have turned out to be too pessimistic practice. Is that the opinion of the petrogeologists, too? Or are they all pointing to absolute limits on the supply of oil that will bind the system causing the kind of crisis you predict? Certainly world energy per capita already has peaked. How did we get from oil to energy? In any case, peaked relative to what period of time? For example, in real terms, gasoline prices seem to have peaked in the US, but they're lower than they were 20 years ago. Whether or not it's a peak depends on your frame of reference. Further, world energy use could be peaking because people are figuring out how to use energy more efficiently. Look at California, where we've been increasingly efficient at using energy (but got punished by the energy monopolies for our efforts -- no good deed goes unpunished). Some argue that world oil has now peaked. If Hubbert is right, the decline will mean that oil and gas will fall by half in the next 50 years. But given what you said above, Hubbert was talking about the US, not the world. That will mean the end of capitalist economy, pace some as yet unknown act of final ingenuity. Wow! I'm sorry if your bald assertion has driven me to make a Brad-like response: I can more easily accept the idea that we're running out of oil than I can accept the assertion that higher oil prices (or more non-price rationing) will drive capitalism away. Why can't the cappos get the proles to pay for it? It is common to say that the streets of major cities were full of horse shit, but hey! the automobile came along. The automobile, however, was already invented. Anything which you rely onto to overcome a major crisis must already exist on someone's drawing board. But there is no evidence at all of any single technology or complex of technologies capable of subtituting for the myriad energy and feedstock uses of petroleum. On
Re: Re: RE: capitalism's expansion vs. limits
Jim Devine wrote: BTW, what does the petrogeological profession as a whole think of Hubbert? what is the professional consensus on his methods and conclusions? why should we believe him rather than others? or is he reputable the way Milton Friedman is? When Mark started going on about the disappearance of oil a few years ago, I called around to a bunch of industry savants, and had several on the radio. Mark's opnion is definitely a minority one - which doesn't make it wrong, of course. But he doesn't often acknowledge this. A guy from the Petroleum Finance Corp. agreed with me when I suggested the real danger was that we'd choke ourselves if we burned all the oil we have, rather than it running out disastrously soon. Doug
Re: Feedback from Jay Moore on Hardt-Negri
From J. Moore's Recommended Books section at his website THE LEFT: A READING GUIDE X. Looking to the Future with an Optimism of the Intellect and a Tenacity of the Will Edward J. McCaughan, Reinventing Revolution: The Renovation of Left Discourse in Cuba and Mexico (Boulder: Westview Press, 1997). Based on interviews with a large number of Leftist intellectuals in these two countries which have had nationalist and anti-imperialist revolutions, argues that alongside existing orthodox socialist and liberal currents a third rennovative Leftist perspective is emerging, although differently in each case, in the aftermath of the changes in the former Soviet bloc and despite the ideological popularity of neoliberalism. While continuing to uphold traditional socialist values about social justice and equality and the relevance of more nationalistic policies, this perspective takes issues with both Leninist and liberal conceptions of politics in favor of more direct forms of democracy and a greater autonomy of civil society from the state. This current is said to have its basis in the many activist intellectuals who came out of the New Left generation of 1968. Antonio Negri, The Politics of Subversion: A Manifesto for the Twenty-First Century (Cambridge: Polity Press, 1989). Nick Witheford, Autonomist Marxism and the Information Society, Capital Class (Spring 1994): 85-125. - Original Message - From: Louis Proyect [EMAIL PROTECTED] To: [EMAIL PROTECTED] Sent: Saturday, June 23, 2001 11:01 AM Subject: [PEN-L:13877] Feedback from Jay Moore on Hardt-Negri I thank Louis for his critique of Empire. I'm glad that he actually made it through -- which I couldn't do because I was so digusted with it both by the more general issues Louis hits on and by its near-total divorce from an examination of the facts on the ground. (Negri may have an excuse since he's been in prison but what about Hardt?) This is supposed to be the Das Kapital for the 21st century? Hah! Compare Marx's richly detailed description taken from the British Blue Books of the disastrous effects of industrial capitalism's rise on the working people in both core and periphery. There's nothing like that whatsoever in Empire. It operates exclusively (except for a paltry few anecdotes) in abstraction. One thing, however, I would say to Louis and others who may be trying to get a fix on where these cats are coming from is that the linchpin for the whole theoretical edifice is Negri's keen interest in Marx's Grundrisse. He wrote a long exigesis of it some years ago when he was associating in France with Althusser's school -- sort of his response to their exigesis of Capital. Much more so than the few short (but much-quoted) articles by Marx about the alleged civilizing effects of British colonialism in India, the Grundrisse (written roughly around the same time period) is chock full of sections that are conducive to that approach (although somewhat more dialectical in Marx's original hands). If you want to pull out the rug from under all of this stuff, that's where you have to go, I think. Good luck. I'm not! best, jay www.neravt.com/left/ Louis Proyect Marxism mailing list: http://www.marxmail.org/
Re: Re: Re: RE: capitalism's expansion vs. limits
Doug is probably correct that the threat of choking on oil is an impending danger, but the oil is getting harder and harder to get. The low hanging fruit is gone. The oil that is now being drilled in the Gulf of Mexico is deep at the bottom of the sea. No one knows what will happen if a serious accident occurs there. The oceans, in addition, are being pushed to their environmental limits -- think of the fishing industry in decline. I would love to believe that ingenuity will rescue us. We have seen many surprising technological innovations, but often they too come at a cost. For example, the water in Silicon Valley is seriously poisoned from the solvents that the industry uses. Mark may be wrong that oil will be the ultimate constraint. I suspect water will come first -- although our economy wastes an enormous amount, which gives us some wiggle room. In other parts of the world, the people are note so fortunate. Doug wrote: When Mark started going on about the disappearance of oil a few years ago, I called around to a bunch of industry savants, and had several on the radio. Mark's opnion is definitely a minority one - which doesn't make it wrong, of course. But he doesn't often acknowledge this. A guy from the Petroleum Finance Corp. agreed with me when I suggested the real danger was that we'd choke ourselves if we burned all the oil we have, rather than it running out disastrously soon. Doug -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Michael: Mark may be wrong that oil will be the ultimate constraint. I suspect water will come first -- although our economy wastes an enormous amount, which gives us some wiggle room. In other parts of the world, the people are note so fortunate. Actually, it probably makes sense not to use a verb tense like will come when referring to water. Our Tom Kruse was on the front lines of a struggle over water in Bolivia, while Palestine and South Africa are confronting sharp struggles over this issue *right now*. While there might be technical substitutes for oil--at least in theory--there is none for water. Bill Moyers had a very good show on PBS the other night that explored many of these issues. In South Africa they are hiring people from places like Soweto to cut down Eucalyptus trees near rivers and streams. These are not only not native to the country, they suck up water just like the more familiar weeping willow tree in the USA. Despite such measures, there are enormous capitalist pressures to waste water even more than is the case today. For example, a steer requires TWENTY GALLONS of water each day. And, along with automobiles and entertainment, Macdonalds and Burger King serve as the storm troops of neoliberalism. One of Moyer's interviewees made the point that if this process does not come to an end, the world will look like Haiti before the end of the century. This I fear is the way that capitalism is moving, not so much toward cataclysm but desperate inequality where the apologists for the system, both on the left and the right, live inside walled communities with air conditioning and 3 square meals a day. Louis Proyect Marxism mailing list: http://www.marxmail.org/
Re: Re: capitalism's expansion vs. limits
Date: Fri, 22 Jun 2001 18:19:57 -0700 From: Jim Devine [EMAIL PROTECTED] Unfortunately for Marx, his volume III theory of the rising organic composition of capital doesn't work very well on either a theoretical or a practical level. Not only can the capitalists compensate for any rise in the organic composition of capital by cutting wages relative to productivity (raising the rate of surplus-value), Patrick wrote: Jim, there are always countervailing tendencies (absolute/relative s.v. extraction), of which I think the most important since the current int'l slowdown in accumulation began three decades or so ago, has been the temporal/spatial *displacement* of the devalorisation of overaccumuled capital. Third World lending has been one vehicle (even if not, in the whole scheme of things, a particularly large one in volume terms... but we've really felt it down here!). right. -- all of the stuff below also basically involves agreement with Patrick's position. Consider, for instance, the Suter/Eichengreen studies of financial crashes: every 50 years like clockwork since 1820s, involving 1/3 of all nation-states (the WB's 2000 Global Finance report actually promotes the financial-Kwave theory, I guess because Stiglitz still had his hand in and Eichengreen refused to draw the logical conclusions). It seems that the big difference during the 1980s was the concentrated power of the WB/IMF--as cops for NY/London/Frankfurt banks--to NOT ALLOW the devalorisation of financial capital by instead rescheduling debt (Nyerere and Castro failed to get the debtors' cartel up and running). But the point here is that this process of displacing the overaccumulation crisis South didn't solve it. Racing to repay unpayable debt, the Third World glutted most raw material and light mfg. markets. So the displacement -- the recent spatio-temporal countervailing tendencies Marx did not really foresee or theorise -- simply means that the overaccumulation problem grows worse, right? it's true that spatio-temporal displacement doesn't solve the problem -- so that it makes crisis tendencies worse, since imbalances continue to accumulate. But my point was only that Marx's theory wasn't very good. I'm not going to get into all that argument here, but I agree with the literature's almost-consensus. That does not mean that I reject the capitalist tendency toward crisis, though, as I noted in my original message. My point is that the capitalist tendency toward crises causes repeated crises rather than automatic breakdown. but any crisis that occurs purges imbalances from the system, destroying capital and allowing accumulation to recover -- to drive itself into crisis once again. A matter of the balance of class forces, right? Including territorial struggles? So, that's why helping to more surgically identify the pockets of resistance and empower them--instead of comrade Chris' utopian global-regulatory strategy--becomes ever more crucial. To link the pockets of resistance obviously also calls for the need for solidarity--the globalisation of people (not of capital or state functions, which will overwhelm us if they maintain their current international capacities, without nation-states reigning in capital, e.g., through a new round of exchange controls). right. Even this doesn't inevitably lead to capitalism's demise. Instead, it encourages collective solutions, i.e., the monopolization of markets and the rise in the role of the state. The last time capitalism had a gigantic Crisis -- the 1930s -- it encouraged the rise of state solutions, from social democracy to fascism, with the U.S. New Deal in the middle, on a national level. The next Crisis will likely see its solution on the global level, as seen in embryonic form in the Kyoto accords. (Somehow, the Bushwackers aren't anti-abortion on _this_ issue.) If the current US slowdown turns into a global depression, it encourages further development of collective control, perhaps the creation of a global Fed. Human ingenuity would show up in the form of a New Bretton Woods conference, a global-statist version of social democracy or fascism or something in-between. This eventually would allow the re-establishment of capitalist accumulation Why are you so sure, comrade Jim, about global solutions (restructuring of relations of production)? The old familiar intercapitalist-competition plus bloc-formation process plus geo-military conflict seems just as likely, doesn't it? I'm not sure. The capitalists unite to solve problems (as when the elites united circa 1945 to form NATO, Bretton Woods, etc.) But you're right that competition re-asserts itself. Where I had an ellipsis, I originally said something about the eventual rise of neo-neo-liberalism, which will come (roughly) 25 years after the new global collective solution and roughly 25 years before the next global collective solution. I elided this
Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Michael Perelman wrote: Doug is probably correct that the threat of choking on oil is an impending danger, but the oil is getting harder and harder to get. The low hanging fruit is gone. The oil that is now being drilled in the Gulf of Mexico is deep at the bottom of the sea. No one knows what will happen if a serious accident occurs there. The oceans, in addition, are being pushed to their environmental limits -- think of the fishing industry in decline. isn't the ladder for getting the fruit -- the technology for extracting oil -- getting taller, too? I totally agree that there's a lot of environmental impact: that's why I put the emphasis on the role of external costs (i.e., on capitalist society's failure to produce distribute consume at the lowest possible social cost) rather than absolute natural scarcity. The same goes for water, where the biggest problem is pollution. BTW, here's a poem (received via the internet) for all my friends on pen-l: Are you tired of all those mushy friendship poems that always sound good but never actually come close to reality? Well, here is a friendship poem that really speaks to true friendship and truth itself! Friend, When you are sad, ... I will get you drunk and help you plot revenge against the sorry bastard who made you sad. When you are blue, ... I'll try to dislodge whatever is choking you. When you smile, ... I'll know you finally got laid. When you are scared, ... I will rag you about it every chance I get. When you are worried, ... I will tell you horrible tales about how much worse it could be and to quit whining. When you are confused, ... I will use little words to explain it to your dumb ass. When you are sick, ...stay away from me until you're well again. I don't want whatever you have. When you fall, ... I will point and laugh at your clumsy ass. This is my oath, ...I pledge 'til the end. Why you may ask? Because you're my friend! If you send this poem to any of your closest friends, get depressed because you'll realize you only have 2 friends, and one of them is not speaking to you right now anyway. Remember: A friend will help you move. A good friend will help you move the body [The above message evoked Eudora's flame-alert, warning that I might get my keyboard washed out with soap. I decided not to tone it down, since all the objections came due to the poem.] Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~JDevine
Re: capitalism's expansion vs. limits
At 23/06/01 12:16 -0700, Jim Devine wrote: my point was only that Marx's theory wasn't very good. I'm not going to get into all that argument here, but I agree with the literature's almost-consensus. That does not mean that I reject the capitalist tendency toward crisis, though, as I noted in my original message. My point is that the capitalist tendency toward crises causes repeated crises rather than automatic breakdown. I am not sure if this is the criticism you are making of Marx's theory but the following passage in the Manifesto suggests that crises are a mechanism by which the system adjusts and continues: (perhaps a bit like earthquakes adjusting the pressures between the tectonic plates) And how does the bourgeoisie get over these crises? On the one hand by enforced destruction of a mass of productive forces ... Increasingly scarce oil or water will lead to the destruction of capital (dead and living) in sectors of the economy relying on relatively cheap oil and water. It will be reinvested in new sectors of the economy which can make oil and water available at a higher exchange value, relative to the total exchange value of commodity-producing human society. Jim's post, on which Patrick was commenting, seems to make essentially this same point about the destruction of uncompetitive capital. I do not know if Jim is saying that Marx explicitly argued in Volume III that the rising organic composition of capital led to an automatic (and permanent) break down. A reference would be important if Jim is saying Marx really did this, as opposed to arguing extensively from one side of a dialectical analysis which must be placed in the context of all of his writings. Of course in a society which is coming up to saturation point in using certain limited natural resources less of the total social product comes directly from applying labour power to raw materials which exist as use values naturally in the environment. A higher proportion of the total product of the society will be devoted to the means of production. In that sense the organic composition of capital will continue to rise, but with each crisis a proportion of dead labour will be destroyed as capital, and the cycle of capitalist accumulation will pick up again in a self-organising self-perpetuating system. The environmental limit imposed on capitalism, I suggest, is not that this will stop the cycle of capitalist accumulation permanently. It is that increasing concern with the environment will increasingly force into collective consciousness the need even for capitalists to consider what is a highly complex social system explicitly as a social system, and not just the happy product of the blind workings of private ownership of the means of production. This will erode the concept of bourgeois right as a satisfactory legal basis of society. It will force closer alliances between the working people and the macro planning of finance capitalism. That is the riddle now, about how capitalism prepares the ground for socialism. But without struggle the dominant class character of capitalism will not fall, and it will not cease to be capital. It may cease to be capital when no one and no limited corporation can own any means of production as of absolute right, including land, but is at most someone with a license to manage it in a way accountable to the whole of the society. Increasingly complex information systems permit greater social feedback and accountability without treating all individuals as identical. The ground is laid therefore for a push towards socialism faster than we might expect, but it must be on a global basis, so the incremental step to change is rather high. That is why we must embrace global reforms enthusiastically and overcome an aversion to them. Chris Burford London
Re: Re: capitalism's expansion vs. limits
Chris B writes: I do not know if Jim is saying that Marx explicitly argued in Volume III that the rising organic composition of capital led to an automatic (and permanent) break down. A reference would be important if Jim is saying Marx really did this, as opposed to arguing extensively from one side of a dialectical analysis which must be placed in the context of all of his writings. as far as I know, Marx never said that the rising composition led to breakdown (automatic collapse). However, many attribute this to him. In any event, it's not even a very good theory of (more limited) crisis, IMHO. Jim Devine [EMAIL PROTECTED] http://bellarmine.lmu.edu/~JDevine
Slippery slope from 'strategic competitor' to outright adversary
[Robert Merton anyone?] China Growing Uneasy About U.S. Relations Bush's Comments Cited as Catalyst By John Pomfret Washington Post Foreign Service Saturday, June 23, 2001; Page A01 BEIJING, June 22 -- China's leaders are increasingly concerned that Washington and Beijing are headed for a confrontation as China emerges as an economic and military power in Asia, and the United States ponders how to deal with its rise, according to a senior Chinese official, Western diplomats and Chinese policy analysts. In recent interviews, these officials and analysts described growing unease in Beijing that shifts in attitudes in both nations seem to be pointing toward a showdown. The senior Chinese official, who spoke on condition of anonymity, said Chinese leaders have become especially concerned about the outlook for U.S.-China relations since President Bush took office. Bush has termed China a strategic competitor. The topic dominated a discussion between Chinese President Jiang Zemin and Singapore's senior minister, Lee Kuan Yew, during Lee's visit to Suzhou, China, last week, sources said. It has prompted China to send an unprecedented number of emissaries to the United States, most recently Assistant Foreign Minister Zhou Wenzhong, who was in Washington this week, carrying a message to senior U.S. officials that the Chinese leadership wants to head off future conflicts. In addition, the Chinese president was reported to have sent a message through Russian President Vladimir Putin to Bush last week saying he hoped there would be no lasting tensions over the April 1 collision of a U.S. Navy reconnaissance plane with a Chinese fighter jet. The big issue is how the United States looks on a developing China and its place in Asia and the world, said the senior Chinese official, known to have close ties with the Chinese president. A few years ago, we could not even be considered a competitor; now you call us a 'strategic competitor.' Another issue is how China looks at the United States. Both of us have to manage China's rise because, let us be clear, China will rise, he said. If conflict is inevitable, then it will be very troublesome. People are saying conflict between the United States and China is inevitable. Chinese are saying it, Americans are saying it. It's creating a vicious cycle. It's very destructive. A series of recent incidents has strained Sino-American ties. Bush has backed a national missile defense system, which China fears will negate its nuclear deterrent. Over Chinese objections, the U.S. government permitted Taiwanese President Chen Shui-bian unprecedented access to the United States, allowing him to stop twice in America and meet lawmakers in recent weeks. Bush also hosted the Tibetan spiritual leader, the Dalai Lama, at the White House. He approved a multibillion-dollar weapons package for Taiwan, including, for the first time, submarines. In reaction, although irritated, China has hewn to relatively mild statements, shunning the verbal fusillades of the past. The senior official explained China's subdued response by saying that it was a sign that China's views on the United States were maturing. We could easily make relations with the United States more difficult, he said, but your government is still forming. We are really not sure about its direction. Many American friends advised us: 'Don't be too nervous. Don't make a final judgment about it.' So we have tried to be calm. Yet, according to the senior Chinese official and Western diplomats with contacts among Chinese policymakers, the leadership in Beijing is concerned that at least some people in the Bush administration want to take a confrontational approach toward China, which could have long-term implications. China's foreign policy establishment is worried that the foundations are being set now for long-term aggressive competition with the United States, said a senior non-American Western diplomat. This is not something that most of them want to see. One reason is that the direction of Beijing's relations with the United States could exert a strong influence on China's development plans, forcing funds to be funneled into defense spending instead of economic growth. Bush's performance has given ammunition to critics of the United States in China, the senior official said. He particularly noted Bush's comments in April that the United States would defend Taiwan in case of a mainland attack, which he said China interpreted as basically an end to the longtime American policy of strategic ambiguity in the Taiwan Strait. The official also acknowledged that China's old policy, filled with hectoring and threats, toward Taiwan, an island it claims is part of China, has been substantially modified because it only seemed to help China's adversaries on the island. We gave Chen Shui-bian a lot of political capital, he said in a rare acknowledgment that China's aggressive attitude toward Chen helped him become Taiwan's first
RE: In Latin Economies, a Sinking Feeling
http://www.iht.com/articles/23763.html LONDON Economic reform is in big trouble in Latin America. The region has a triple bane: low savings rates, high government borrowing and debt as well as an addiction to foreign capital. . Argentina and Brazil tried to break that stranglehold. In 1991, Argentina created a dual currency system that pegged the peso and the dollar at parity. The credibility of the currency peg was supposed to give Argentina the benefits of U.S.-style low rates of interest and inflation. . In practice, interest rates stayed prohibitively high. The country entered a prolonged slump. It has a chronic current account and budget deficit, a fatal combination for currency pegs. International Monetary Fund bailouts didn't work. . In desperation Domingo Cavallo, author of the currency law, was brought back to save the peg, but it looks as if he is going to destroy it. He has announced that the peg will be debased by introducing the euro into the basket as well as the dollar. Bang went the simplicity and transparency of the system, and people's trust in it. . Mr. Cavallo has now introduced a surreptitious 7 percent devaluation of the peso for exporters. Exporters are to be subsidized through the budget for the theoretical difference between the actual peso exchange rate and the devalued peso exchange rate, assuming the euro were already part of the Argentine peg. Importers are to be penalized by as much. . The focus of Argentine policy is wrong. Mr. Cavallo's aim is a quick fix of the peso peg. But Argentina's growth deficit has come about because of the rigidities of the Argentine economy, not the exchange-rate mechanism. Politics may dictate this policy, but economics ensures its failure. . In Brazil much more has been done about getting the domestic economy right. Massive privatizations have succeeded in attracting almost as much foreign money to Brazil every year as China receives. Fiscal policy has been highly conservative. Devaluation in the wake of the Asian financial crisis was successful. Since 1992 Brazil's per capita gross domestic product has risen 19 percent, compared with 11 percent for Argentina. . But all is not well. Brazil's huge foreign debt burden has made it highly vulnerable to any domestic or foreign shocks. And now there are two: a financial drought of foreign capital and a real drought that is creating a power shortage. . I reckon foreign direct investment will fall by nearly 50 percent this year to $16 billion, leaving a foreign funding gap of a record 8.5 percent of GDP by 2002. After receiving foreign investment, Brazil will still have an external financing requirement larger than its $35 billion of foreign exchange reserves. The only option will be higher real interest rates and lower growth. That mix endangers budget stability. . And the energy crisis is for real. Brazil's economy is facing a large supply shock as the government is forced to cut electricity supply by 20 percent partly because of drought. . The government of President Fernando Henrique Cardoso cannot deflect responsibility for the energy crisis, which not only a matter of rainfall but also of a terrible drought of investment in infrastructure that makes Brazil overdependent on hydroelectric power. . The energy crisis is eroding the popularity of all reformers, stopping laws being passed that are fundamental to the reform process. . Brazil is on a knife-edge. There is now a serious risk that Brazil's crisis will take out Argentina. So don't ask for whom the bell tolls if Brazil goes belly up. . Don't be complacent about the effects on global markets, either. Together, Argentina and Brazil account for 45 percent of emerging market bonds. Spanish and U.S. corporate investors provide more than 55 percent of Brazil's annual foreign investment inflows of $37 billion. Brazil and Argentina also account for a huge slug of Spanish and U.S. banks' overseas loans. . Even Asia would not be immune to a Latin American crisis. Hong Kong's peg would survive a collapse of Argentina's, but Malaysia's would not. That would topple the government of Prime Minister Mahathir bin Mohamad, plunging Southeast Asia into further turmoil. . The writer, managing director of Independent Strategy, an investment advisory company, contributed this comment to the International Herald Tribune. Herald Tribune.
Pascal Lamy live on WebTV/Audio
http://www.pnltv.com/fi-news.html
Hey, sorry but I'm on a Lamy binge :-)
[and to think he used to be on the steering committee of the French Socialist Party...] US-EU: The Biggest Trading Elephants in the Jungle - But Will They Behave ? Speech by Pascal Lamy to the Economic Strategy Institute, Washington D.C., 7 June 2001 Clyde, thank you for your kind introduction. I am very glad to finally make it to the Economic Strategy Institute. We've talked about it for a long time, and events have always conspired against us. But you yourself have done a great deal to place the ESI at the forefront of events in this town, and around the world by the quality of the work ESI has produced, and by the sheer energy of you and the other members of the Institute. To begin by defining our terms, it is of course clear that the EU and the US are the biggest elephants in the world trading system. We both count for about 20% of world trade, and a slightly higher percentage of foreign direct investment. One or other of us is the largest single trade and investment partner for many countries, but we are of course also each other's largest single partner. So there is no inherent reason why we should fight all the time: indeed, we share a number of interests. Let me briefly set some of these out. First, even where we are rivals, our economies are deeply integrated. Take the example of the aircraft industry. 40% of the inputs, by value, of Airbus aircraft comes directly from the US. Our industries are strongly intertwined. But not because of cosy supplier arrangements. Because of vigorous competition, and the search for the competitive edge. Secondly, and even more obviously, we both rely heavily on trade and investment itself. This applies every bit as much to our so-called traditional industries as to our leading edge sectors, such as steel. Frankly, that is one of the most disturbing aspects of Tuesday's announcement by President Bush on steel. Let me say a word about that. The Administration proposes to take a three-pronged approach: first, negotiations on worldwide excess capacity, second, negotiations on the rules governing steel trade, and third, the launch of a 201 investigation. There are a number of disappointing aspects to this. First, we do not believe that imports are the cause of the problems currently experienced by the US steel industry. Second, the claim that the US alone has borne the brunt of the Asian financial crisis is not upheld by the facts. The EU has actually done more than its share. Third, the issue may well be to do with restructuring - but in the US, first, not worldwide. In the last twenty years, the EU industry has been restructured, taking out 50 million tonnes of production capacity and three quarters of a million jobs - and without import restrictions against other WTO members. Result: a highly competitive EU industry, which produces significantly below US costs. During the same period, the US industry has actually increased its capacity, by 20 million tonnes. So you will understand our sense of sheer bafflement that the priority action by the US is to set up bilateral negotiations, with the 201 sword of Damocles in the background, to force others to take out capacity. Now, I understand the legacy cost argument. But frankly that is a question concerning the way the US operates internally. We resist the notion that legacy costs can be passed to others by restricting imports. We are not of course naïve about this. Every system, including both the EU and US, needs pressure valves to prevent explosions. But we need to move forward on the basis of the facts. That is why we have been pushing for some time for a real discussion, (we have suggested in the OECD), to get the facts surrounding this troubled world industry out into the open. We suggested this, in fact, to the US over a month ago. But the offer was not taken up. Nonetheless that is the way forward - not barely disguised threats of comprehensive, unilateral US import restrictions. Third shared interest between the US and the EU, and this is again linked to steel: the capacity of the system to deliver. It is tempting for both us to ignore this point. In pure negotiating terms, 20% of world trade gives both of us leverage, and lots of it, whether this is in Geneva, a regional trade agreement, or in a bilateral deal. But at the same time, we have to recall the basic interests of power brokers in any system, whether it is a playground, a jungle or the World Trade Organization, which is to respect, nurture, and safeguard the system. Here, I have to say that we are becoming concerned, as are a number of our partners, about growing pressures in the US towards unilateralism. Now I know that unilateralism, like beauty, often lies in the eye of the beholder. One man's unilateralism is another's determined leadership. But for me, the distinction here concerns whether one is willing to play within the rules of the game, and take others' interests and concerns into account. I am not here today to offer my views on
RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population.
Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
Well said. The question then is do these contradictions reinforce each other or do they cancel each other out? On Sat, Jun 23, 2001 at 10:57:39PM -0500, Forstater, Mathew wrote: Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
RE: Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits
2 definitely can be the basis for problems with 1. and 2 also does nothing without also having 1, because you can't push on a string. none of it matters if we have problems with 4, and many policies to address 1 will exacerbate 4 (mindless growth uses up more resources and creates more pollution, etc.). ditto then that if addressing 2 is a way to grease the way for 1, 4 is exacerbated. policies to address 1 can also exacerbate 3, because one of the ways that economies deal with 3 is to have excess capacity and unemployment. 1 and 3 can be linked in other ways--if technical innovations shift income distribution away from workers to capitalists, consumption demand can fall. -Original Message- From: Michael Perelman [mailto:[EMAIL PROTECTED]] Sent: Saturday, June 23, 2001 11:28 PM To: [EMAIL PROTECTED] Subject: [PEN-L:13892] Re: RE: Re: Re: Re: Re: RE: capitalism's expansion vs. limits Well said. The question then is do these contradictions reinforce each other or do they cancel each other out? On Sat, Jun 23, 2001 at 10:57:39PM -0500, Forstater, Mathew wrote: Constraints to Capitalist Expansion: 1) lack of aggregate demand - obviously, low demand means low sales. it also probably means slow productivity growth, competitive weakness (for firms, industries, sectors, nations), which feeds cumulatively back to low demand 2) availability of credit. credit/liquidity crunch for banks and (other) firms. credit, finance essential to growth 3) structural/technological - real capital formation necessary to meet intersectoral requirements. lack of 'machine tools' (and in 21st c., microchips) can clog up the works. 2 above is about M-C-M', with 3 we move to the schemes of reproduction (and expand it to 3 or more sectors, e.g., 2 capital goods producing sectors, one producing capital goods that make capital goods the other producing capital goods that make consumption goods. But split the consumption goods sector into 2 or more also, and see the additional problems of changes in the composition of final demand (some become obsolete, market saturation, new goods are introduced -- but some of these problems are linked to 1 above. capitalism requires not only more but different. 4) biophysical limits. nonrenewable resources, but also using stock renewables at a rate greater than their rate of renewal. and the local and global assimilative capacities (ability of the environment to transform waste into harmless forms -- qualitative and quantitative limits here. 'reforms' necessary to deal with these limits are so severe it is hard to see how it would still be 'capitalism' once we're done. on the other hand, it's still here. what about political? social? some are arguing that we're already beyond capitalism in some fundamental ways-- 'managerial' mode of production. elitist credentialism and the annihilation of the surplus population. -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail [EMAIL PROTECTED]
