I haven't been able to follow closely the way in which the rest of the
world has been dealing with the ongoing economic crisis.  I imagine
that in the moves in progress one could pre-figure the type of
re-structuring of global capitalism most likely to happen.

On Oct. 12, while the thoughts of the conference were still fresh in
my mind, I wrote something in reply to Michael.  However, I wasn't
totally satisfied with my jottings and was hoping for some breathing
room at work to redact the thoughts more carefully -- and make them
shorter.  Now it's clear I won't have a chance to improve on what I
wrote then.  The thoughts are getting older already -- hence less
useful.  So here's what I wrote then, without further editing.

*  *  *

Michael Lebowitz prefaces his questions:

> I have three short questions to introduce into
> our discussion which have been provoked by the
> presentations we've just heard. These questions
> are based on two assumptions: (one) capitalism
> does not collapse by itself and (two) in the
> absence of agents, subjects, popular forces,
> capital will sooner or later exit the crisis
> restructured.

Michael then asks:

> My first question is how exactly can capitalism
> restructure itself successfully? I stress here
> that I'm not asking you to act as advisors for
> the capitalist system. Rather, I think it is
> important to understand the strength of the
> capitalist system; in other words, it's important
> to respect the enemy tactically.

On the next day of the conference, I tried to say that this capitalist
crisis is not terminal, precisely because of what you suggest above:
The active subject required to overthrow capitalism and build
socialism, a united, self-educated, and coordinated global working
class is yet to emerge.  Internationally, the degree of development of
this subject is very unequal.

As I tried to say also, U.S. imperialism is something else.  U.S.
imperialism is likely to be in a terminal crisis, regardless of how
long it may still last.  By imperialism I mean the exploitation of
poor countries by rich countries using extra-economic forms of
appropriation of wealth.  We know since Hilferding and Lenin that the
modern type of imperialism is turbo charged by the power of today's
capitalist production.  Thus, it will remain extremely dangerous until
the end, but it is also in irreversible decay, without a trace left of
historical justification if it ever had one (as Marx claimed in his
writings on India), with its global legitimacy exhausted.

Let alone the standpoint of the struggle for socialism, even from the
standpoint of the needs of global capitalist production, imperialism
under U.S. hegemony has become cost ineffective, passe.  It is in a
terminal crisis.  The ultimate basis of U.S. imperialism is, of
course, international inequality.  More precisely, it is the
tremendous disparity in the size of the economies of the U.S. and its
Western allies vis-a-vis the rest of the world.  If those differences
narrow down beyond a point, the scheme stops working.

You're right in pointing out that global capitalism will re-structure
itself if no global subject impedes the re-structuring.  The
confusion, hesitation, and lack of coordination exhibited by the
governments of the rich countries as the crisis erupted was temporary.
 I said on Thursday, at the conference, that the logic of capital was

On the one hand, there is competition among capitals, divisions,
conflict, etc.  On the other hand, there's the need for capitalism to
reproduce itself, which in this case appears as the need for
capitalism to re-structure itself.  In the face of a crisis,
especially one so grave and pregnant with political opportunities for
the class adversary as this one, the need of capitalism to ensure
basic conditions for its re-structuring is likely to assert itself
sooner rather than later.

Ideology is the easiest thing to jettison.  In fact, to the extent the
doctrine of so-called "neoliberalism" is in the way of this need of
capitalism to re-structure itself, the doctrine is likely to be
abandoned.  That is why "neoliberalism," as a doctrine that postulates
"free" markets (as opposed to direct forms of collective agency) as
the panacea to social problems always and everywhere, is in shambles.

In my presentation at the conference, I suggested that some version of
Keynesianism was likely to be restored, because there are not many
other obvious ways for global capitalism to pull itself out of the
crisis in a reasonable period of time.  I'm not talking Keynesian
monetary policy, which is showing its limits, but Keynesian fiscal
policy (and the Keynesian vision behind the original Bretton Woods'
plan), like the nationalization of big chunks of the banking system
now in process, global economic governance, (regulated) trade of goods
and financial assets at a global scale.

To me, handing the Nobel to Krugman is a symptom of this need
asserting itself ideologically.  (I don't mean that I'm not glad that
Krugman, a fundamentally decent person with demonstrated sympathy to
the interest of working people, got it, instead of a right winger.)
Other symptoms of this ideological re-adjustment have been visible for
a while already.

U.S. imperialism also conflicts with the need of capitalism to
re-structure itself under existing global conditions.  I can list a
few factors pushing it into a corner:

1) the anti-imperialist rebellion in the South, with historical roots
in the anti-colonial struggle, a part of which is a process of
consciously building socialism, another part of which is simply a
nationalist impulse with no aspirations beyond the capitalist horizon
(with no impermeable membrane separating one from the other in

2) the erosion of the modicum of domestic consensus required for
imperialism to exist, as a result of the failures in Iraq and
Afghanistan and the persistent internal opposition to the war (part of
which stems from a shift to the left in the social consciousness of
Americans, part the result of Americans not wanting to pay the human
and financial sacrifice);

3) the U.S. debt, not only public, but also private, whose counterpart
is the financial and global strategic position of China and other
Asian and oil-producing countries; and

4) the current financial and economic crisis, which accelerates the
reckoning due to the three factors above.

The main way capitalism can re-structure itself is via fiscal
Keynesianism.  In particular, the nationalization of large chunks of
the financial system banks and the plugging of the holes created by a
the decline in private consumption and investment with public

But, where are the resources necessary to fund fiscal Keynesianism?
The U.S. is already indebted and, as its economy shrinks, its debt
looks scarier.  At a global scale, the only way to fund an expansion
in other forms of global spending is by expanding global savings (i.e.
limiting global consumption).  Reducing the consumption of Americans
sufficiently has political limits.  At a global scale, the creation of
debt money can only depreciate the currency, which in the absence of
higher interest rates would only stimulate more consumption.  Hence,
the kind of fiscal Keynesianism required to re-structure global
capitalism is *global* in nature.  I call it "global Keynesianism."
In other words, the resources held by China and the oil producing
countries are effectively the re-structuring fund.

Who in the history of capitalism has funded an enterprise without
claiming dividends?  Not the merchants and money capitalists that
propped up the Louises in XVIII century France?  Not the U.S. in WW1?

So, this poses the thorniest of all issues, which is of course the
distribution of the costs/benefits of the re-structuring among nations
and social classes.  That depends on political strength, which depends
on (broadly understood) economic strength.  Global money is a social
power.  In this case, global power.

But is U.S. imperialism without a hand to play?  Certainly not.  It
has military power, which counts for something.  More importantly, it
still has a huge economy with enormous long-run productive potential.
This is what the creditors are pondering precisely.  However, the U.S.
doesn't have an upper hand.  In theory, the U.S. could try to
blackmail the rest of the world using military threats.  To paraphrase
Marie Jana Korbelov√° (aka Madeleine K. Albright), What's the point of
having a big military if not to use it?

Well, IMO, that strategy would fail miserably.  The only upside of the
debacle in Iraq is that it exposed clearly to the world (and
Americans) the miserly limits of U.S. military power.  The U.S. has as
many nuclear weapons as the rest of the world together, but how could
it effectively blackmail China or Russia militarily with a sputtering
economy and people fed up with militarism abroad and at home?  It'd
destroy much more resources that it'd intend to appropriate.  That's
why the strategy would not work.  (I'm not saying it's impossible, by
the way.  Stupid people in power can do stupid things.  My point is
that it would not accomplish its intended goal.)

The other available method is, of course, the depreciation of the USD,
trying to impose an inflationary tax on the rest of the world.  That'd
be like taking itself hostage, pointing a gun to its temple, and
threatening to pull the trigger.  That could work partially.  It's
been working, since China and Brazil (and Russia?) have promised to
help.  But they are going to help the re-structuring from a position
of relative strength.  I cannot envision the BRICs propping up global
capitalism without demanding a bigger role in global economic
governance and the effective dismantling of U.S. imperialism as we've
known it.  The strategy of depreciating the USD would lead to the most
rapid evaporation of U.S. power I can think of.

The global character of today's financial markets cuts both ways.  The
U.S. cannot dissolve them unilaterally at a massive scale without
hurting itself badly.  In the 1980s, the reason why many countries in
South America refused to renege on the debt unilaterally was that
they'd be effectively cutting themselves out of the world market.
That's what ties the U.S. to its liabilities today.  Global money is a
global power.  Under existing conditions, who'd lose more if the U.S.
severed its links with the BRICS?

The BRICS are now on the creditor side of the re-structuring.  They
are exposed and they have power.  They are nationalists.  They are not
building socialism now.  But, from a historical, global viewpoint, the
nationalism of the BRICS is today a progressive force.  Of course, the
nationalism of the BRICS is only progressive, only historically
justified, to the extent its impulse effectively contributes to
reducing international inequality, the most fundamental basis of
imperialism *and* global capitalism.

If they drop out of the sphere of influence of capitalism and try to
consciously build socialism, the game changes.  If they just limit
themselves to protecting their industrial development and narrowing
the gaps in average productivity and standards of consumption with
respect to the rich countries (whether or not this is the intention or
merely an unintended byproduct of the plan to assist domestic private
accumulation), they will cooperate in the re-structuring for the
reasons suggested above.

What seems clear to me is that global capitalism needs to jettison
U.S. imperialism, at the very least its most extreme form
(unilateralism, extra-legal aggression), if not altogether.  The
complete dismantling of imperialism in all its forms is of course
unlikely without a stronger rebellion from below, i.e. one, two, three
many Venezuelas.

> My second question is how can agents and subjects
> act to prevent a capitalist restructuring? And
> who are those agents?

You wrote that the background of these questions is Brazil and
Argentina.  In the case of the U.S., I wouldn't accept the premise,
namely that U.S. workers should struggle to prevent a capitalist

Clearly, for workers in the U.S., the political horizon is not
socialism, but a rapid way out of the crisis, i.e. a rapid capitalist
re-structuring of the economy so that they end up with jobs and
increased economic security.  Given political conditions, the longer
it takes for the crisis to end, the worse for them.  The working
people in the U.S. can only get crushed, more fragmented, politically
weaker (and more inclined to extreme right-wing ideology) under a
longer crisis.

> My third question is can capitalist states prevent
> capitalist restructuring or do they serve as agents
> of capitalist restructuring?

Again, with Brazil and Argentina as the backdrop, this seems fair.
However, as I reflect on the question, it seems to me that the
question begs its answer.  To the extent Brazil's and Argentina's
states are capitalist states, they can't go beyond the horizon of
helping, taking part in, or at least allowing the re-structuring of
capitalism, not only externally (something that even Venezuela can't
avoid), but domestically.

But if we remove the adjective "capitalist" (since things are in some
flux in South America), the answer is, It depends on the political
conditions.  If Brazilian and Argentinian workers manage to
revolutionize their state, then they are enabling themselves to go
beyond merely re-structuring capitalism.

> Now, those are the questions that Julio wanted
> me to post. Unfortunately, he has returned to
> New York and I didn't get a chance to talk with
> him about why he wanted these posted.

I thought people on PEN-L would find your questions interesting.  I
don't think we can measure the interest by the number of postings on a
thread.  Threads get long when the most frequent posters get
interested in them.  But the longer threads may or may not be what
interests readers.  Some people just lurk and pick and choose threads
that interest them.  Some of the people I met in Caracas last week
(people from Asia) are lurkers on this list.  They knew me because of
PEN-L.  Some of them gave very interesting presentations at the

> an excerpt from some comments that I made the
> following day (in the same vein):
> I think the distinction that we have to make
> is to recognize that there are two paths.

If I remember correctly, you prefaced this with a remark about not
looking at things from a long run vs. short run point of view, but
from a capitalist re-structuring vs. building socialism point of view.

> The first is a capitalist path, the restructuring
> of capitalism. The second is a socialist path, one
> which creates conditions for building socialism;
> and one of the most significant of those conditions
> is creating conditions in which there is mobilization
> of subjective forces, masses, the accumulation of
> popular forces.

Once again, with Brazil and Argentina as the backdrop, this sounds
fair to me.  What I can say, from the point of view of things around
me may not necessarily connect with your direct concerns. But I'd
argue here that, under some conditions (e.g. in the U.S.), the
accumulation of popular forces requires not a strategy of obstructing
the re-structuring of capitalism, but ensuring better conditions for
the further unity, organization, and education of workers *in the
longer run*.

Now, can U.S. workers educate themselves if they don't *struggle*
against the capitalist re-structuring?  Sure.  Actually, I'd argue
that they cannot educate themselves if we pose as their immediate goal
the direct struggle against the capitalist re-structuring, because
they can only educate themselves through struggles they actually wage.
 As far as I can see, they may passively resist the re-structuring, as
individuals, not as members of a class in political motion.

David Barkin said to me that the rest of the world, or Latin America
in particular cannot wait until the U.S. gets its act together,
meaning until it decides to reform itself and abolish imperialism.  I
don't disagree with that.  But what I'd argue is that the U.S. is
shifting, and that creates the opportunity for getting its act

People in the U.S. can struggle against *the redistribution of the
cost* of the re-structuring at their expense.  That'd be the most
immediate task, I'd say.  Who knows where that struggle may lead.
Ultimately, of course, the workers' struggle to prevent the dumping of
the cost of the re-structuring on their shoulders will succeed only to
the extent they threaten to derail the re-structuring itself.  But we
can similarly say that not even the mildest economic struggle can ever
succeed in its own terms if workers don't threaten with a bigger
disruption of capitalist reproduction.  So, the argument is silly.
The point is that posing *at the outset* the struggle against the
re-structuring as an immediate goal is wrongheaded, an empty
propagandistic gesture.  It tends to lead to (what I call)

> The first path relies upon the capitalist state and
> reproduces illusions in capitalism; it reinforces the
> idea of capitalism as practical. The second path
> creates consciousness of the nature of capitalism;
> it recognizes that crisis is an opportunity, an
> opportunity to intensify the battle of ideas.

I guess, under some interpretation, the struggle against the
redistribution of the costs of re-structuring global capitalism at
their expense can be viewed as moving along the socialist path.
However, I'd just insist that it shouldn't necessarily imply opposing
the re-structuring as an immediate task always and everywhere.

> The first path, the capitalist path, is the path of
> Mercosur and a Bank of the South that reproduces the
> character of  existing international agencies. The
> second path is the path of Alba and of a Bank of the
> South based on new relations building upon solidarity.

Again, I'm trying to look at things from the point of view of U.S. workers.
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