Tag Archives: Politics

Review: Capitalizing on Crisis

This is a technically complex work of sociology unpicking and analysing trends in US society, economy, and politics over the course of forty years from the 1960s to the 2000s.

Krippner’s basic thesis is that successive policy decisions over the course of this period, each in response to immediate challenges, have ‘financialised’ the US economy. In other words, have shifted the focus of profit making from investment in productive activity to the ownership and exchange of financial instruments. Even major industrial companies come to make significant portions of their profit from activity in the financial market. This shift has significant implications for how the economy is managed, and the location of future crises.

Krippner demonstrates this through a detailed analysis of economic data and a systematic review of policy shifts during this period. Although this is somewhat dry in places the case is convincing. She defines three separate phases. First the deregulation of the domestic financial market as an attempt to get to grips with the social crisis of the 1960s and 1970s, offering policymakers a ‘reprieve from difficult political choices’. Second the response to the fiscal crisis of the late 1970s and 1980s with growing government deficits which altered the relationship between the domestic and global markets driving a ‘dramatic expansion of credit in the US economy’. Finally on the realisation relying on market mechanisms offered in fact very little restraint on consumers, corporations, or governments how approaches to monetary policy developed incrementally in the period up to 2001 to control the demand for credit through interest rates (as opposed to regulation of the supply).

Although the book was first published in 2011, Krippner stops short of the 2007-9 financial crisis, indicating in the introduction that she considers this to represent a separate stage of development that requires a separated analysis. That said it is clear that the ‘depoliticisation’ of economic decision making that Krippner outlines is a significant factor underpinning the later crisis. As Krippner explains, in making this change the expectation had been that the market would impose a discipline on economic behaviour that political actors were unwilling to do. In fact this has turned out not to be the case at all. The market has promoted and validated a lack of restraint particularly in relation to credit which has left us more exposed than ever to the risk of financial crisis.

Although this is not Krippner’s intention, her analysis is a neat fit for the Marxist view of the long term tendency of the rate of profit to decline (see writers such as Robert Brenner and Michael Roberts). The declining profit possible in productive industry leads to speculation in what Marx called ‘fictitious capital’. This growing financialisation becoming increasing unstable and leading inexorably to crisis. The picture here is one that provides a deep-seated explanation for the financial crisis of 2007-9.

So this is a fascinating book with many implications for further analysis. If a touch dry in places, it is detailed, well researched, and a thought provoking discussion of what underpins the modern economy.

Krippner, Greta Capitalizing on Crisis (Harvard University Press, Cambridge Massachusetts, 2012)

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Review: How Will Capitalism End?

Wolfgang Streeck may not in fact answer the question that he poses in the title of this book, but it is still a superb read.

How Will Capitalism End” consists of a set of essays and speeches from the German sociologist published previously in New Left Review (and elsewhere) and organised around the theme of the challenges to capitalism. Each is a thoughtful and valuable contribution to the analysis of modern capitalist, it’s impact on society, politics, and environment, and what our options for the future might be.

The opening essay sets the tone. It poses the suggestion that capitalism has so successfully eliminated all opposition to it’s conquest of politics and society that it’s destructive nature now has free rein without constraint from organised labour or political control. The end result will be the long slow death of capitalism’s ability to deliver for the majority of its inhabitants, without the prospect of its replacement by a different system which can pick up the baton as Marx originally envisaged.

The remaining essays work around similar themes. The emphasis is on the impact of the neoliberal project to disconnect the management of the economy from political and social control. This can be seen in Streeck’s characterisation of the changing nature of the state leading towards the current “consolidation” state where having passed successively through private debt then public debt stages now exists to ensure that we reliably meet our obligations to asset holders.

Another theme of Streeck is the divide between social rights and free markets. Where the democratic state prioritises providing public services for its citizens identified through elections. By contrast the “consolidation” state prioritises the contractual claims of creditors and the servicing of debt. The tension between these two has been a major driver for social and political change since the second world war.

This is a thought provoking and very readable set of essays which should be of interest to anyone who doesn’t accept the orthodox economist world view.

Streeck, Wolfgang How Will Capitalism End? (Verso, London, 2016)

Marx and the state

I wrote about some of the tactical points brought out in the articles in the third volume of Marx’s political writing published by Verso in an earlier post. The other important work of Marx’s in this book is “The Civil War in France” where he analyses the Paris Commune, Europe’s most significant revolutionary event since 1848. The seizure of power by the Paris workers prompts Marx to think about the nature of the state, the impact of its seizure by the working class, and the nature of state power after the revolution.

For Marx the structure of the state is inherently connected to the nature of the economic system on which it is based. So in the “Critique of the Gotha Programme” he says:

“…the various states… have this in common, they all stand on the ground of modern bourgeois society although the degree of capitalist development varies.”

(Marx 2010, p. 355)

And in “The Civil War in France”:

“[the state’s] political character changed simultaneously with the economic changes of society.”

(Marx 2010, p. 207)

However Marx’s attitude to this capitalist state seems deeply ambiguous. On the one hand while Marx portrays the make up of the state as being broadly determined by developments in the wider society and economy, he also gives the impression that it is separate from it with an element of independence. It is not simply the tool of the ruling class. Characterising the state of the French late Second Empire he says:

“it was the only form of government possible when the bourgeoisie had already lost, and the working class had not yet acquired, the faculty of ruling the nation.”

(Marx 2010, p. 208)

In other words implying that it is an independent ruling entity dominated by a ruling class perhaps, but not an organic part of that ruling class. It is therefore a mechanism that the working class could perhaps take over and operate for its own purposes.

On the other hand, he is clear that the state is something that must be overcome by the revolution and is not simply a set of mechanical levers that can be taken over and operated by the working class:

“…the working class cannot simply lay hold of the ready made state machinery, and wield it for its own purposes.”

(Marx 2010, p. 206)

And of the specific progression of the Second Empire:

“the state power assumed more and more the character of the national power of capital over labour, of class despotism.”

(Marx 2010, p. 207)

Marx outlines how the Paris Commune represents a clear break and a separate form to the bourgeois state of the Second Empire. A “working body” where the representatives were revocable and paid workers’ wages and supported by a National Guard of the people rather than a professional army. By constituting a new structure outside the existing state the Commune represented an opportunity for truly revolutionary change.

“It was essentially a working class government, the produce of the struggle of the producing against the appropriating class, the political form at last discovered under which to work out the economical emancipation of labour.”

(Marx 2010, p. 212)

“The Commune was therefore to serve as a lever for uprooting the economical foundations upon which rests the existence of classes, and therefore of class rule.”

 

(Marx 2010, p. 212)

Here Marx seems to be saying that the state is not an independent entity to be taken over by the working class movement and used for its own purposes. Instead the existing state is inextricably linked to the domination of the capitalist class, and therefore rather to be wholly overthrown and replaced by a new and separate structure.

This is crucially important for deciding the strategy of a movement aiming at the fundamental transformation of society. Should it work within the existing ‘rules of the game’ or seek to subvert them? In “The Civil War in France” Marx is writing about a specific contemporary event rather than outlining theory and this obviously colours his approach, but well worth studying for all that.

Marx, Karl The First International and After (Verso, London, 2010)

Thoughts on Marx and tactics

The final book in the three volume collection of Marx’s ‘political’ writings “The First International and After” covers the later period from the First International onward. It contains pamphlets and articles written for the International, letters and a range of other short documents and journalistic work. They show Marx grappling with the tactical issues of the day, many of which remain relevant, in particular on the relationship of different ‘progressive’ groupings in the state and politics.

The English Trades Unions formed a significant part of the International, and yet in the “Inaugural Address” Marx is clear that it is not sufficient to simply pursue the short term interest of the working class within the existing system through improvements in working hours and wages. These are ‘economic’ goals which are important, but should be subordinate to the movement’s longer term goals.

To conquer political power has therefore become the great duty of the working classes.

(Marx 2010, p.80).

In other words revolution – a fundamental change to the system – remains the overarching goal of any genuine movement of the left. Marx makes a similar point from a different angle when discussing the co-operative movement in the “Instructions for Delegates to the Geneva Congress”. Co-operative production allows workers to begin developing economic mechanisms which undermine the root of capitalism.

We recommend to the working men to embark in cooperative production rather than in cooperative stores. The latter touch but the surface of the present economical system, the former attacks its groundwork.

(Marx 2010, p.90)

In other words overturning the system is the key aim of the working class movement, and that requires both economic and political action with a focus on the long term.

This isn’t the whole story though. Later in the same “Instructions for Delegates to the Geneva Congress” Marx proposes a specific programme starting with a demand for limitations on the working day. So Marx is maintaining both a general overall strategy (the importance of political revolution as the ultimate goal) along with a specific tactical programme for immediate action (improving the lives of workers through ‘economic’ measures).

The “Prussian Military Question” similarly focuses on the tactical position of the German workers, whether to support the bourgeois parties in opposition to the aristocratic and feudal state over the issue of changes to military service.

It is in the interests of the workers, therefore, to support the bourgeoisie in its struggle against all reactionary elements, on condition that it remain true to itself.

(Marx 2010, p.144)

The workers can form tactical alliances to pursue short term goals, but must retain a focus on its long term interest – the overthrow of capitalism itself.

Marx indicates a similar dual role for Trades Unions as part of the movement. Rather than viewing Trades Unions as focused primarily on the economic or ‘tactical’ and working within the existing system, Marx points out that they fight both the immediate struggle and have a role in preparing the ground for fundamental change.

If the trades unions are required for the guerilla fights between capital and labour, they are still more important as organised agencies for superseding the very system of wage labour and capital rule.

(Marx 2010, p.91)

However at present, the unions are “too exclusively bent upon the local and immediate struggles with capital” (Marx 2010, p.91).

It is interesting for thinking about this combination of short term and long term goals for the movement that Marx characterises England as being ready economically for revolution, but needing a truly revolutionary movement to take advantage of it (something it hasn’t managed to do in the years since either).

The English have all that is needed materially for social revolution. What they lack is the sense of generalization and revolutionary passion.

(Marx 2010, p.116)

This implies that Marx certainly did not believe that the revolution would happen ‘naturally’ as working class consciousness developed. In other words there is no historically determined inevitability to the revolution, ‘reformism’ is a blind alley. In pursuing short term goals, the left must keep the long term vision in mind, still something that it seems to struggle with (in Britain at least) where working within the system too often seems to have led to a failure to pursue substantive change.

Marx, Karl The First International and After (Verso, London, 2010)

Corbyn and the crowd

In “Crowds and Party” Jodi Dean unpicks the nature of individualism and the impact of crowds in modern ‘communicative’ capitalism. I’ve written briefly about individualism in an earlier post and here I want to make a brief additional note about what Dean writes about crowds, and in particular draw a link from that to the recent British general election campaign.

Dean takes a psychoanalytical approach to understanding crowds using the work of Freud and Lacan among others. The key point here is that a crowd can create a rupture in the status quo. A point through which it is possible to see that things might be different than how they are now. Crowds are able to force a gap which can be held open and form a focus for politics – and a radical party of the left can keep that gap open and use the energy of the crowd to drive for systemic change.

The Labour Party campaign during the recent general election was certainly based on large rallies which brought together crowds of supporters. This was in marked contrast to Conservative Party events held in anonymous hangars to prevent anyone not invited from gaining access. These Labour events were visibly full of energy and passion. Corbyn is a strong speaker to a crowd, and the result was a sense of momentum and enthusiasm not seen in British politics for a while.

Add to this the decline in the influence of the traditional print and television media dependent on the party press office machinery, and the increasing influence of social media and the ‘peer to peer’ spread of news, and the ‘crowd’ seems to have had a profound effect. It created an opening for the prevailing view on the necessity of ‘austerity’ to be challenged. Unforeseen by most media commentators, the Labour Party was able to use this moment to secure a better election result than expected. More importantly they have changed the terms of debate. The Conservatives may have won formally, but they are now having to bend their government to the issues mobilised during the campaign.

In other words, what we are seeing now with Jeremy Corbyn is something which might be thought of as approaching an Event in the sense used by Alain Badiou – a concept also touched on by Dean briefly. The question now would seem to be whether beyond the confines of the election campaign Corbyn and Labour can keep the gap opened by the intrusion of the crowd open in the way described by Dean, and drive home the progressive shift it has started.

Dean, Jodi Crowds and Party (Verso, London, 2016)

Thoughts from the election morning after

The 2017 election campaign is now over, after a campaign where the approach taken by the two main parties could not have been more different. It does seem to me that the surprise loss of the Conservative majority shows that the basic alignment of British politics has shifted. Here are the points that came to mind when I began to reflect on the result afterwards.

First it suggests that the hegemony of  neoliberalism may be coming to an end. For the last forty years the economic policies of both main parties have been broadly similar. In 2017 however Labour ran with a manifesto which did not stick to the neoliberal economic script we have come to expect. Instead they promised to tax the affluent, nationalise key industries, and invest in public services even at the cost of higher borrowing. And what’s more it caught the mood of a significant number of voters whose living standards have been eroded by austerity and for whom the Conservative manifesto offered only more of the same. While there are also both ‘tactical’ and ‘process’ reasons for the result, this shouldn’t disguise the fact that the Labour manifesto was both left wing and popular. In future politics will have to accept that it is possible to be popular whilst supporting an alternative economic strategy.

Second, the style of stage managed campaigning which has dominated British politics in recent years was visibly defeated by a Labour campaign based less on repeated soundbites and more on large public rallies. There was a genuine attempt to energise voters around a positive vision of the future, rather than make a limited and technocratic retail offer. The contrast between a Conservative campaign style based on minimising exposure and Labour could not have been more clear. That’s not to suggest that the Labour campaign wasn’t stage managed, but the Lynton Crosby fear-and-soundbite campaign based on speeches in large hangars to small crowds  and minimal risk was soundly beaten. Future election campaigns will undoubtedly be very wary of being portrayed in the negative and risk averse manner of the Conservative campaign of 2017.

Third, the Labour campaign deliberately targeted young voters and appears (admittedly on currently incomplete evidence) to have succeeded in getting them to vote. The challenge for Labour now is to maintain that level of engagement when the reality is that we continue to have a Conservative government, albeit it a weakened one, and that there will not be an immediate and dramatic change. Political parties can no longer assume that elections can be won purely by tending to the needs of older voters. There is at least the possibility that this will bring some significant changes in policy.

I’m sure there are plenty of other points to be made. It was though very noticeable that the Conservatives interviewed on the weekend television politics shows were keen to load all the blame onto May and her campaign, and ignore the possible wider implications for the conventions of politics in Britain. Time will tell.

Bartleby the Scrivener

Bartleby the Scrivener: A Story of Wall Street is a short story by Herman Melville (author of “Moby Dick”) published in 1853.shirtmockup-450x450

The story is told by a narrator who is a lawyer and employs Bartleby as a copyist. As time goes by, Bartleby begins responding to requests with the phrase “I would prefer not to”. Eventually he withdraws completely from any work, remaining a strange silent presence in the office. He seemingly survives without work or money or a home. The narrator tolerates him for a while but eventually after failing to persuade Bartleby to leave (“I would prefer not to”) moves offices to escape him – only to find later that Bartleby has died in prison after refusing to eat.

Most recently the story of Bartleby came to prominence during the Occupy Wall Street movement for Bartleby’s use of passive resistance, an obvious parallel to the tactics used by the occupiers. Bartleby ‘occupies’ the narrator’s offices on Wall Street calmly but firmly refusing all requests that he work and confounding all the narrator’s requests to either work or leave. Bartleby’s actions have been seen as an exemplar for political action, challenging those in authority over him without expressing any concrete demands, seemingly exactly the pattern followed by Occupy.

Is this passive approach effective? In the story, the narrator relocates his business to escape Bartleby, and as far as we can tell continues to run a successful law practice. Bartleby’s resistance leads however to his imprisonment and eventual death. Whatever his grievance, it doesn’t seem to have been addressed. Similarly Occupy Wall Street was eventually evicted without seemingly having achieved much that’s tangible. Perhaps the moral we should be drawing here is about the limits of passive resistance. Both Bartleby and Occupy create disruption that is initially difficult for the authorities to know how to deal with. But eventually the system adapts and neutralises the threat.

I’m not convinced by this explanation however. If this is supposed to be about politics, then it is almost entirely absent from Melville’s story. Indeed the narrator passes a demonstration for the mayoral election on the street but ignores it, rushing on to his next meeting. It is difficult to believe that Bartleby is making a principled stand against, well, anything really. He simply prefers not to. His refusal is rather a failure to undertake the work required by his employer. This is however a more radical position. Bartleby is challenging the fundamental relationship of capitalist society, that of waged labour. He withdraws dramatically from the market economy – but still seemingly works on his own terms. He continues to copy, but refuses requests to take on other tasks. It is not the occupation of neutral space that is significant (as it was for Occupy) but the radical withdrawal from his employer’s authority. The lesson to be learned is a far more active and aggressive one than that of passive resistance taken by Occupy.

In other words, there really is no substitute for effective action which targets the core economic structures of society. Now that’s something for the modern left to reflect on.