Precis on theories of capitalist crisis, replies to CB and SM >>CB: Yes, , but I have this thing that Marxists shouldn't be focussed on how crises occur, but what how they impact the classes and class struggle, , if you follow me. They would be interested in what's happening now, as you say, but they would be interested in a different aspect of what's happening now than what "economists" are interested in . They would want to know how the crisis impacts class consciousness, class unity, the struggle between the classes right now. Do you see the distinction I'm making ?<<
Well as lists like PEN-L and LBO-T show (at least to me), discussion and analysis is largely futile. I don't see myself as socially placed to affect elite opinion about such matters, and yet I don't see myself as socially placed to take part in some enhanced class struggle. Besides, by the time the analysis is taking place, it might be that opportunities for exploiting the crisis have already passed. It's history, and history gets written by the academics in the establishment. I suspect, as has already been pointed out at, for example, Leninology blog, that it isn't going to be places like US, UK or Australia where the political opportunities present themselves. CB: >>See above. Marx didn't even leave a coherent theory of crises. People have to pick through his writing and construct one. A lot of the theory is in Vol. III which he didn't even bother to complete. I think that's because he didn't want Marxists to spend a lot of time analyzing the why and how of crises. He wanted them to concentrate on raising the class consciousness of the working class. The main thing needed is to demonstrate to the working class that capitalist wealth is exploited from them, and that mass immiseration at one end of the wealth pole is linked inextricably with wealth accumulation at the other end of the wealth pole, i.e. the Absolute General Law of Capitalist Accumulation.<< I think Lenin is one of the more important analysts in a rationalist tradition, and he was certainly no laid-back, sold-out academic or establishment opinion-maker. And he worked on the issue past his important conception of imperialism and analysis of WW I and its aftermath. As for taking advantage of the current crisis, who is placed to do this? Democrats who promise mortgage relief? Lou Dobbs who has a show that is viewed by millions where he gets to argue that there is nothing wrong with finance capitalism so long as it is regulated? When I look at the current figures as to the extent of the sub-prime loan problem combined with the way venture capital and private equity are faltering at putting together ever larger take over and merger deals, this crisis does look to be a MAJOR one. I'm reminded of late 70s, early 80s. And that is because the US and other OECD countries really do look to be heading into a recession together, which brings up the depression word. OTOH, one thing to remember about private equity--and things that act like private equity even though the term is not used, such as Warren Buffett's Berkshire Hathaway--this sort of predatory capital has pretty much had free run of the OECD economies for the past 15 years, and this sort of predatory capital likes crises. It likes distressed assets; it even orchestrates panics on companies and sectors to make its money go further (since its principals expect 20% or more returns on investment). SM: >>The crisis in profitability is demonstrated by the fact that for the past decade a huge share of newly formed money capital has been leveraged into fictitious capital rather than invested as real capital.<< Except your timeline is a bit short, don't you think? I mean what do the S&L, junk bond (remember Milken?), dot.com, and Enron debacles indicate? Enron was fictioning its capital from the late 1980s, because it had managed, like so many of these fictitious capital firms, to stay ahead of big bang 'reforms', such as deregulation and privatization schemes, not just in the US (which often lags behind other OECD countries in actual deregulation and privatization), but in Europe and Asia. I think the term 'crisis' indicates the fairly rapid onset of said crisis. So it's like saying the symptoms of an illness which just started this morning are key to understanding the illness. It might be crucial to control the symptoms, but you have to get to the root causes of the illness as well (or let 'nature run its course'). So for me the more fundamental question is: why now has the US hit the limits to all this leveraged speculation? For one thing, I believe it is because its militarism can not now be financed, and much of this has been financed through speculation, since there were no limits placed on debt. For example, banks and financial institutions in Japan, after months of almost denial that they wouldn't do anything as stupid as invest in sub-prime loans in the US, are now revealing tens of billions of dollars of losses. They have all these dollars got because Japan has a huge trade surplus with US (mostly from automobiles and parts, and consumer electronics). The dollars can't be invested in Japan. The dollars get invested in the US. The institutional investors put the money where they think the money will earn the most money. So they put the money into investments that were exposed hugely to the sub-prime loans. Five years ago it made them experts and financial geniuses. Now it means they made investments on the hopes of the highest rate of returns 'possible' that will turn into huge losses. Capital Speculation and Capitalist Militarism, run out of NYC and DC. Is it the end of the American Empire? Are Europe, the oil-rich Gulf States, and the trade-surplus states of E. Asia abandoning the Empire now that it doesn't give good returns on their dollar investments? I think Bernanke thought if he raised interest rates to stem core inflation, it would shore up the US dollar and the surplus countries would put more money back into investments in the US (financial, speculative investments, that is). But the money didn't flow in, the rate hikes weren't enough to shore up the dollar, and all these firms in NYC and London couldn't service their debt or put together new private equity deals. So he has cut the rates again, making the dollar even cheaper. This only seems to feed speculation on commodities, perhaps the last bubble to pop. So it could be the end of the American Empire, and this will usher in a state of affairs more similar to what Lenin knew so well. Or it could be the onset of a global crisis for capitalism, which might lead to political evolution. I get the feeling -- especially after the invasion and destruction of so much of Iraq -- that as the US comes unwound, its not going to go quietly. CJ _______________________________________________ Marxism-Thaxis mailing list [email protected] To change your options or unsubscribe go to: http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis
