Will capitalism collapse?

[Psy]

Capitalists have indeed, under heavy pressure, tried another system. That was fascism. And they too don't long back to those days, albeit for different reasons. In fact, this is one of the bigger reasons why the more serious currents of the bourgeoisie warn against protectionism (there are many more links).

Capitalists demand protectionism when they are losing to other foreign capitalists which is why in the US productive capitalists (that are losing to foreign capitalists) are demanding protectionism while the finical capitalists (that are dominating foreign capitalists) are against it. Protectionism in itself is not fascism if it were then Germany leading up to WWI would have been fascist (which they weren't).

[Charles Xavier]

Capitalism will never collaspe on its own. It'll need a big push from the working class... those of you sitting around and not actively working in the mass movements are not going to find the revolution without hard work.

[Greenman]

Interesting bit today on Guardian Comment Is Free site from Will Hutton (journo-economics writer close to British Prime Minister, Brown) It is basically what Hutton thinks Brown will/should be asking of the forthcoming G20 meeting - (my emphasis added)

And it will need every member country to pre-agree that it will obey IMF instructions – including G7 countries like the US, France and the UK. China should be told that if it wants more clout then it must make the reminmbi a fully-convertible reserve currency; otherwise it must remain outside the world's inner councils.In other words every G20 country, including the US, needs to recognise their interdependence and responsibility. They must deploy co-ordinated government heft to underwrite broken banks and shattered confidence. Their actions can be cemented by a strengthened IMF to which they cede genuine economic sovereignty – and which itself must become more accountable. Then Brown's global bargain might get some economic purchase and put a floor under the global economy. Brown faces formidable obstacles to make the April summit rise to the challenges, but his task as chairman is to confront world leaders with these truths. It will demand risk, leadership and courage. But better that than generalised guff. The circumstances demand no less.

So basically, a puff piece for Brown. But notice the prescription for the New World Economic Order. Basically a binding global "structural adjustment" programme! Won't that be fun! And the IMF is going to be "more accountable" to whom?
What seems to be illustrated here is that the ruling class and their mouthpieces are thrashing around and sinking, but grasp desperately to what they see as a liferaft - a global economic dictatorship of the IMF!

[nuisance]

Capitalism cannot collapse, it has to be abolished.

[Comrade Anarchist]

Yes but as i look around i start to feel that nothing will change and that all these posts on here are nothing and will do nothing but hopefully one day they wont be in vain.

[ckaihatsu]

And it will need *every member country to pre-agree that it will obey IMF instructions* – including G7 countries like the US, France and the UK. [...] In other words every G20 country, including the US, needs to recognise their interdependence and responsibility.

The G-20 countries * wish * they could get it together enough to have an IMF umbrella, but they can't. See:

The G-20 summit being held in Washington today takes place amid the worst economic and financial breakdown since the Great Depression of the 1930s. Notwithstanding the rhetoric about the need for a new Bretton Woods Agreement and calls for the remaking of the international financial system, the summit will provide no solutions to the rapidly deepening crisis. On the contrary, in the absence of any coherent program, it may well see the divisions among the major capitalist powers widen.

And even if they could pull it together despite near-zero growth, they've already slipped behind the leader of the pack, China, in their sick, macho global rat race for bragging rights.

China should be told that if it wants more clout then it must make the reminmbi a fully-convertible reserve currency; otherwise it must remain outside the world's inner councils.

That's the give-away -- allow me to paraphrase: "China, you can't join our special, super-cool club (that's now lagging behind you in growth) if you don't open up your vaults to the rest of us through your currency, the renminbi."

This is the equivalent of a soft trade war because the G-20 countries have been *****ing about China for years now. China has been keeping its hoarded value off the books and away from its currency. China has been exploiting its workers so brutally that it undercuts the global competition *everywhere* and has now amassed the bulk of manufacturing business for consumer goods, particularly for the U.S. and E.U. markets.

Nonetheless these countries, particularly the U.S. and China, are locked together as a result of these trade relationships, which all exploit and oppress the working class. Despite their spats they're still on top and we aren't, so that says more than anything else.

Because of this evident economic inter-dependence I'd like everyone to SHUT THE FUCK UP about so-called "hyperinflation" -- it's *not* going to happen because these are major economies, not Argentina or Zimbabwe. I addressed this scare-mongering bullshit at this thread:


Some early signs of hyperinflation

http://www.revleft.com/vb/showpost.p...3&postcount=17

[Psy]

Yes but as i look around i start to feel that nothing will change and that all these posts on here are nothing and will do nothing but hopefully one day they wont be in vain.

Capitalism has been undergoing changes for decades as capitalists has they have yet to solve the crisis of a falling rate of profit and have been only been able to postpone dealing yet now capitalists have no way to delay with dealing with the falling rate of profit. We are going to have huge changes in the next decade as the old arrangement between the proletariat and bourgeoisie has no future, the bourgeoisie simply can't lend workers money to consume anymore. The real question is not if thing will change (they will) but who is going to decide how things change is going to be the workers or the capitalists?

[ckaihatsu]

Capitalism has been undergoing changes for decades as capitalists has they have yet to solve the crisis of a falling rate of profit and have been only been able to postpone dealing yet now capitalists have no way to delay with dealing with the falling rate of profit. We are going to have huge changes in the next decade as the old arrangement between the proletariat and bourgeoisie has no future, the bourgeoisie simply can't lend workers money to consume anymore. The real question is not if thing will change (they will) but who is going to decide how things change is going to be the workers or the capitalists?

This is really the point -- it boils down to this, which we've known all along, but which more and more people are going to become conscious of, very quickly, because of the ongoing, worsening crisis of capital.

People are going to realize that the real world is becoming like a game of Monopoly where they're going around and around in circles without really ever having a chance to land on any square to play the game. When this happens it * doesn't matter * how much Monopoly money there is printed, or who owns what -- the point is that all that *most* people actually own is a shoe, or a hat, or maybe at best a car....

Everyone, even Marxists, needs to understand that a ruling class will use any invention or fiction they can to hang onto power, in whatever form. That's why it *requires* a conscious, mass effort to strike the final blow to overthrow capitalists' rule once and for all. Here's one of their techniques currently in use, fractional reserve lending, similar to credit extension:

Every currency has a *different* reserve ratio. If I recall correctly, the U.S.'s has now *dropped* to something like 8%, or a 12-to-1 ratio of currency-to-reserves. This is because it has increasingly needed *credit* to pay for its imports from sellers like China. By *lowering* the amount of reserve value it *officially* needs to keep on hand, putting * 12 times * that value out into the economy, it is over-extending the *actual* value, in reserves, that it has on hand, relative to China's * 6 *-to-1 ratio. This is in addition to the U.S.'s massive national debt and current accounts deficit.

[Bilan]

So if capitalism fails,what are we up against?

It's not a question of ' success' or 'failure', you're working a fictitious paradigm which wont lead you to any conclusive material ending, but just throw you further into abstraction.
But, to clear up for the sake of it, if we operate within the 'fail' /'win' paradigm, capitalism is 'successful', it has established itself all over the world.
If Liberal Democracy comes under threat (speaking from the West), then the manifestation of the capitalist reaction will be relative to the size of the threat.

capitalism 2.0?

What does that mean? Dominace of Capital over labour the second time?

as the leaders of the anglo-american elite rush to establish their order once more

The 'race' isn't really of much importance when discussing the repercussions of a heavy capitalist crash (no, not 'destruction', but crash). More likely class conflict will become much, much more open and violent. That doesn't mean communist revolution, nor a victory for the working class, either. It's results are variable depending on, well, alot of things.

[Bilan]

Interesting to note that the majority of people (in terms of single options) voted for "Yes, it will collapse", though combined No, one.
But I have to ask, despite this poll asking the wrong question - and I don't think everyone here is quite comprehending the sheer impact of what a real collapse of Capitalism is, nor how it can be 'saved' - just what do people think Capitalism "collapsing" entails, and why?

[ComradeOm]

What does that mean? Dominace of Capital over labour the second time?

Given recent events it looks like an ever closer marriage between state and capital... perhaps to the point where market mechanisms are irrevocably superseded by a state-directed financial nexus. Lenin's predictions as to state-monopoly capitalism might finally be realised

Obviously the 'Capitalism 2.0' tag is somewhat misleading (we're probably well past 3.1 at this stage and going into Vista) but capitalism adapts and changes much of its structural form every few decades. It remains to be seen whether this is just another exercise in shedding skin

I found the thoughts of New Capitalism (PDF) from Robert Preston of the BBC to be interesting. Not that I necessarily agree with them, of course, but its an indication of the way many capitalist theorists are thinking. What is not in question is that we are in the middle of a period of profound change

But I have to ask, despite this poll asking the wrong question - and I don't think everyone here is quite comprehending the sheer impact of what a real collapse of Capitalism is, nor how it can be 'saved' - just what do people think Capitalism "collapsing" entails, and why?

As far as I'm concerned the last 'collapse' of capitalism, or the last time it came close, was the first few decades of the 20th C. The combination of intense competition (WWI) and the Great Depression shattered capitalist structures throughout most of Europe. Capitalism as a whole survived but it took decades to re-establish the liberal environment of the fin de siècle. Those decades saw war, revolution, and suffering on a genocidal scale

One thing that's always stuck in my mind was Hobsbawm writing on why he became a Communist in the 1930s. He describes how there was this all-prevailing feeling that capitalism was tottering and without a future; people were actively casting around for alternatives. He himself more or less fell into Communism in the absence of other alternatives; what with capitalism dying and fascism obviously not appealing to a Jewish immigrant

[Bilan]

Given recent events it looks like an ever closer marriage between state and capital... perhaps to the point where market mechanisms are irrevocably superseded by a state-directed financial nexus. Lenin's predictions as to state-monopoly capitalism might finally be realised

That doesn't really sound like a 'new form' of capitalism.
It implies that the state will be working more blatantly in the interests of capital - and therefore, part of the subordination of the working class.
That should not be recognized as 'new'. That is old. It is a return to the blatant coercive nature of developing capitalism (e.g. see this Capital, Chapter 10, section 6).
I'm not overly damiliar with 'state-directed financial nexus'. Is that from Imperialism?

As far as I'm concerned the last 'collapse' of capitalism, or the last time it came close, was the first few decades of the 20th C. The combination of intense competition (WWI) and the Great Depression shattered capitalist structures throughout most of Europe. Capitalism as a whole survived but it took decades to re-establish the liberal environment of the fin de siècle. Those decades saw war, revolution, and suffering on a genocidal scale

What structures are you referring to here?
I find you're implying Capitalisms ideological integrity was crushed by this, rather than its structures. would you mind elaborating?

[ComradeOm]

That doesn't really sound like a 'new form' of capitalism.
It implies that the state will be working more blatantly in the interests of capital - and therefore, part of the subordination of the working class.
That should not be recognized as 'new'. That is old. It is a return to the blatant coercive nature of developing capitalism (e.g. see this Capital, Chapter 10, section 6)

That's not what I was getting at. There's no question that today's state works in the interest of the capitalist class - from which it takes its form and directions, etc, etc - but there remains a distinction between the two. I think we are about to witness an end to state as a semi-independent actor on the economic stage. That is, the two (corporation and government) will truly become indistinguishable as the state's direct influence on the real economy continues to grow at a startling rate

I'm not overly damiliar with 'state-directed financial nexus'. Is that from Imperialism?

The phrase is my own but essentially I'm drawing on Lenin's Imperialism (who in turn drew on Hilferding, Hobson, Bukharin, etc... I keep meaning to read those works) for the relationship between the state and finance capital. Today we've reached the point, unthinkable just a year or two ago, where it is the state that controls the vast flow of capital that sustains the capitalist economy. Nationalising car makers is one thing but banks are the 'nerve centres' of the capitalism. This is just unparalleled in a liberal capitalist economy

What structures are you referring to here?
I find you're implying Capitalisms ideological integrity was crushed by this, rather than its structures. would you mind elaborating?

By structures I mean the various institutions that capitalism relies on to survive. Most obvious is the state, and its various bodies, but also the various exchanges that comprise the market

The most obvious result of WWI was the collapse of the various empires of the East. In most cases state authority simply vanished, however temporarily, and in Russia the capitalist class itself was swept away. Revolutions were rife in the après-guerre world and the new capitalist states established in the wake of Versailles were extremely weak. Capitalism survived but it did so barely in these regions. Any 'ideological weakening' was the result of real economic and political problems. The Weimar Republic, for example, was an incredibly weak state that was threatened from both left and right before simply being discarded by German industrialists

When the Great Depression arrived it greatly weakened the Western powers but simply destroyed the unsteady state edifices in Central and Eastern Europe. In the face of economic turmoil the states collapsed into dictatorships. The result was fascism, protectionist blocs, and ultimately another war

I'm convinced that future historians will look back at two world wars as a single civil war in which European capitalists tore their system to shreds and then fought to piece it together again

Edit: You know that capitalism is out of its comfort zone when Gordon Brown might as well be taking economic advice from this man

[Cumannach]

But are the banks actually being nationalized or are they just being taken into state custody until their debts have been paid off by the taxpayers, so they can immediately privatize them again? It wouldn't even be suprising to see them returned to the very same shareholders afterwards at the end of it all, those hard done by shareholders whose property rights were so rudely and unfairly impinged upon by the government and the politicians. I mean that's socialism you're talking about there we all know what happens with that.

[ckaihatsu]

President Obama, unfortunately, is the musical chairs, or hot-potato president, inheriting the pre-eminent sinkhole of the new century. With the following statement he is now decidedly on the defensive, overshadowed by the economic cyclone that practically has a fixed street address.

Autos, health care, energy top a busy agenda

BY TODD SPANGLER • FREE PRESS WASHINGTON STAFF • February 25, 2009

WASHINGTON -- Saying the economic crisis "will not determine the destiny of this nation," President Barack Obama on Tuesday laid out a bold, wide-ranging agenda for America and said he is "committed to a retooled, reimagined auto industry that can compete and win."

http://www.freep.com/article/2009022...+will+recover+

The teeter-totter over semantics -- *is* it a 'nationalization', is it *not* a 'nationalization' -- is going nowhere soon, and there's *absolutely nothing* that can replace its grip on the news, either. The "need-for-a-new-9-11" environment is back, and we're going to see the political climate quickly falling in behind the economic one.

The banking system is the most acute expression of the inherent anarchy and irrationality of the capitalist system, which is rooted precisely in the contradiction between private ownership of the means of production and finance and the social, and global, character of production.

http://wsws.org/articles/2009/feb2009/pers-f25.shtml

More horrifying than the possibility of renewed tensions leading to world war is the possibility that it *won't* happen -- that the worldwide financial system, such as it is, stays relatively chummy with the leaders of major countries, and those leaders with each other. In the absence of growth the ruling elite may very well decide to sit pat and turn the world over to daycare.

For those of us who prefer a more dynamic, forward-looking engagement with the future there will be increased opportunities for pointing out the obvious -- not only that the emperor has no clothes, but that he isn't even going anywhere.

[Crux]

I could not find another thread discussing this issue, but looking at the current global recession, do you think the capitalist system (specifically, the USA) will finally collapse under its own weight, like the Soviet Union?

I find a few people hoping that it will collapse, but my thinking is that liberals will rescue it in a sham New Deal type "rescue package for the people".

Capitalism does not collapse purely of it's own I'm afraid. That's where we come in.

[bretty]

I don't believe that capitalism will collapse by itself, but it is a system with internal antagonisms that over and over again will weaken the system. But I think that only the organized working class could actually make capitalism disappear. (and a "collapse" without a strong revolutionary movement would not be a good thing anyway)

We are unfortunatly quite weak at the moment, I find it hard to believe that we will succeed during this crisis, but we do have a great chance to grow so that we will be in a much stronger position in say 10-20 years. We must stop laughing at the system fucking up and start organizing instead, put in the next gear. Time to get serious.

/agree. Capitalism won't collapse, the process of neoliberalism and the peripheral effects of this on countries will, however, I think over time reach a real climactic. I don't know if capitalism will necessarily be destroyed by this, but it is inevitable that some growing circumstance will come out of the current degenerative cycle.

[Orange Juche]

Now, I hate hate hate capitalism. I find it to be disgusting, disturbing, and evil.

But.

I don't see it collapsing any time in the forseeable future. Most people (at least in America) are too invested in their Blackberrys and reality television, and are too stupid, to even see that they're getting fucked now. As it gets worse, they'll cling on the first thing or politician that seems to sound good that promises to get them out - and believe me - the people with the dough aren't going to let anti-capitalists anywhere near that possibility.

I see fascism to be FAR more likely at least in America, than anti-capitalism will be for a while. Its horrible, but true.

[political_animal]

Apart from Marx declaring out of hope 150 odd years ago that it was 'inevitable' that capitalism would collapse, is there any actual evidence for this to be the case? I can see the inherent contradictions within the capitalist system but I fail to see how the conditions could occur where these contradictions would be so grave as for the system to collapse in on itself.

Further, it is surely harder now for this to happen than in Marx's day. Only 3% of capital physically exists. The rest is only theoretical in that it exists on computer screens. If there comes a time - and I don't see that happening soon - where there was such a liquidity problem for the major capitalist economies of the world, they could simply 'invent' more capital.

The 'crisis' is a crisis for the people of the world who are losing their livelihoods but this is presented as the 'system' having a crisis, masking the reality that it still continues unabated, shares are still traded, banks still exist and multi-national corporations still make huge profits. It is used to scare and control people in to thinking their future is tied in to the continuing existance and dominance of the capitalist system, that there is 'no alternative'. This is the challenge to all of us.

[RedScare]

I don't see it collapsing this time, the liberals will charge in an try to patch it up. However, it sets the stage for a bigger crisis in the future, I believe.