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The Great Recession


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The current global crisis is a manifestation of a fundamental problem in the process of the accumulation of capital. The problem is the lack of surplus value production. This contradiction has been concealed by decades of accumulating debt. Burgeoning financialisation involving bull runs since the 1980s have helped disguise the long-term weakening of the advanced capitalist economies. Economic performance in the United States, Western Europe and Japan has deteriorated since about 1973. The years since the start of the current cycle, which originated in 2001, have been worst of all.

The declining economic dynamism of the advanced capitalist world is rooted in a major sustained fall in profitability, caused primarily by the secular over-accumulation of capital. This problem goes back to the early 1970s. By 2000 in the United States, Japan and Germany, the rate of profit of private industrial capital had yet to make a comeback, rising no higher than that of the 1970s. With reduced profitability, capitalists had smaller surplus value to add to their labour processes. The perpetuation of reduced profitability since the 1970s has led to a steady falloff in accelerated capital accumulation across the advanced capitalist economies. The economic interventionism of the capitalist state have obstructed the realisation of the conditions for the necessary radical devalorisation of capital. Consequently economic downturn has not been precipitous enough to bring about a full recovery involving a restoration of profitability. The outcome is sustained stagnation.

To counter this persistent stagnation states, led by the United States, have been forced to underwrite ever greater volumes of debt through ever more varied and exotic financial forms. Initially, during the 1970s and 1980s, states were obliged to incur ever larger public deficits to sustain growth. But while provisionally keeping the economy relatively stable these deficits also rendered it increasingly stagnant. They thereby promoted the continued stagnation of capital by preventing capital proceeding through its “natural” cycle involving sharp downturns. This interventionism obstructed the return of accelerated capital accumulation. The state is now securing progressively less growth for any given increase in borrowing.

States, in the early 1990s, sought to overcome the problem by a budget balancing policy. Deficit reductions brought about by budget balancing resulted in a significant fall in aggregate demand. Consequently during the first half of the 1990s both Europe and Japan experienced devastating recessions that turned out to be the worst of the post-war period. The U.S. economy, itself, experienced the so-called jobless recovery.

Since the middle 1990s, the United States has been obliged to resort to more powerful and risky forms of stimulus to counter the tendency to stagnation. This is why public deficits were replaced with private deficits and asset inflation. In the great stock market run-up of the 1990s wealth on paper, fictitious capital, massively expanded. This development entailed a record-breaking borrowing increases. Consequently a powerful expansion of financial capital and consumption was sustained.
Government financial policy together with the general neo-liberal agenda of the bourgeoisie led to the historic equity price bubble of the years 1995-2000. Equity prices rose as a response to the law of the tendency of the general rate of profit to fall. New investment, free from significant technical composition of capital increases, exacerbated the prevailing over-accumulation of industrial capital. This was followed by the stock market crash and recession of 2000-2001.This development depressed profitability in the non-financial sector to its lowest level since 1980.
Greenspan countered the new cyclical downturn with another round in the inflation of asset prices. By reducing real short-term interest rates to zero for three years, he facilitated an historically unprecedented explosion of household borrowing. This contributed to and fed on rocketing house prices and household wealth. The world housing bubble between 2000 and 2005 was one of the biggest of all time. It made possible a steady rise in consumer spending and residential investment which together drove the expansion. Bush’s budget deficits together with record household deficits succeeded in obscuring the weakness of the underlying economic recovery by creating the appearance of sustained economic prosperity. The rise in debt-fuelled consumer demand as well as super-cheap credit superficially and provisionally revived the American economy. It also led to a new surge in imports and the increase of the balance of payments deficit to record levels.

Simultaneously, instead of increasing investment, productiveness and employment to increase surplus value, individual capitals sought to exploit the hyper-low cost of borrowing to improve their own and their shareholders’ position by way of financial manipulation — paying off their debts, paying out dividends, and buying their own stocks to drive up their value. This financialisation created a fictitious prosperity The same sort of things had been happening throughout the world economy — in Europe and Japan. In the United States and across the advanced capitalist world since 2000, the contradiction has been as follows: The slowest growth in the “real economy” since the 1970s and the greatest expansion of the fictitious economy in U.S. history.

Just as the stock market bubble of the 1990s eventually burst, the housing bubble eventually deflated. As a consequence, the house-driven expansion during the cyclical upturn moved into reverse. Just as the positive wealth effect of the housing bubble drove the economy forward, the negative effect of the housing crash drove it backward. With the value of their household residences declining and household borrowing collapsing households were forced to consume less. The sub-prime crisis arose as a direct extension of the housing bubble. Because of the ensuing enormity of the banks’ losses credit froze up at the very moment of the slide into recession.
It is clear from the above argument that it does not necessarily follow, as held by much of the Irish Left, that stimulus provided by the capitalist state to the domestic economy is not a prescription for providing a way out of recession. Indeed the argument above teaches the lesson that “artificial stimulus” can constitute a factor that sustains or encourages recession. Most of the Irish Left, including the less passive trade union UNITE, focus its efforts on campaigning for a solution within the framework of capitalism through the medium of the capitalist state which they misidentify as an eternal nanny state. They thereby sustain the illusion that capitalism is potentially a system that can serve the interests of the working class. If this utopianism of the Left were true then there would be no need for communist society.

The Euro crisis is a general a product of the conditions that contributed to the Great Recession. After the crash of 2008 the contradictions of the Euro grew increasingly visible. Consequently the market increasingly discovered its shortcomings. This manifested itself in the growing economic and financial problems of the so called peripheral states within the Euro zone. States such as Greece, Portugal and Ireland. These economies were running growing budget deficits. This meant that they were compelled to increasingly borrow on the financial markets. But because of the worsening economic conditions under which they were forced to do this, together with other factors, the interest rates at which borrowing was possible for them became increasingly usurious. No longer were they really in a position to borrow on the bond market. This meant they were left with merely two options: a bailout from the EU or default. In this way the economic crisis for these states became a growing problem for the EU itself culminating in a collapse of the Euro and its banking system.

One thing needs to be made clear. The Irish economy did not collapse because of irresponsibility regulation, banking and unscrupulous bankers. Pinning the blame on the aforementioned is a form of populism that distracts the attention of the working class from the real problem –the contradictory limits of capitalism. It is because the generation of surplus value within the reproduction process was the central problem facing the Irish economy that the bubble was created involving vast amounts of debt. To compensate for the absence of economic growth based on profitable industrial production bubble conditions were created that inevitable burst.
The banks of the core Euro zone were bloated and sitting on mountains of toxic debt collected from its periphery and elsewhere (the United States included). Consequently the core was vulnerable to collapse too. Because the core members were not prepared to let their banks collapse they imposed draconian conditions on the states that received financial help from them. This forms part of an attempt to protect its banks by rescuing funds from the periphery that was owed to the core of the European banking system. But the real aim of the markets was not merely to force the peripheral states into default. The underlying aim was to collapse of the Euro itself thereby bringing about the reconfiguration of the European capitalist system.

Ultimately the source of the Euro crisis is not, as some argue, its flawed architecture, rampant financialisation nor the Great Recession itself. Nor was the Euro crisis itself due to reckless spending by both the public and private sectors of Greece, Portugal and Ireland.
These latter factors and the Euro crisis are the result of the failure of the valorisation process to produce surplus value on a scale sufficient to provide accelerated accumulation of capital. Because of this failure capitalism has been compelled to conduct itself in a way that has led to massive financialisation involving copious credit culminating in financial crisis, crash and economic recession. Debt is not indefinitely sustainable when there obtains abject failure by the system to produce surplus value (profit) on a sufficiently large scale. As I have indicated before, the failure of capitalism to bring about an adequate restoration of profit during the 1974/75 crisis marked a turning point that resulted in the sustained stagnation of capital. The 74/75 dip was not sufficiently deep to overcome the crisis of capitalism. Consequently even if the ECB was to currently dish out mountains of Euro the problem would only partially sort itself out in the short term. In the long term it would lead to a much more acute problem.

Public nor private debt is not the problem. Public/private debt is a product of the problem of profitability. Because of the lack of profitability debt has ballooned thereby reinforcing the problem. For capitalism to economically recover a very deep depression involving massive reductions in the value of wages and social welfare spending is a necessity. The only other (authentic) option is communist revolution.

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The Deficit is Stagnating, Just Like the Economy


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The rest of the world seems to be suffering from austerity fatigue – apart from the Berlin and Dublin governments (and London too – but no-one is holding it up as a model for anything).

The Department of Finance tells us that the deficit is improving. DoF reports that the general government deficit fell from €22.4bn in 2009 to €12.4bn in 2012. But it is widely known that the impact of bailing out bank shareholders and bondholders has had a hugely distorting effect on public finances. Unfortunately, DoF does not show these effects in the same release as the overall government finances, and you need to go to a separate database to get these data.

Adding the two together produces a measure of the underlying deficit, excluding both costs and revenues from the bailout. It is regrettable DoF doesn’t do this itself.

The table below shows the deficit excluding the effects of the bank bailout.

2009 2010 2011 2012
General Government Deficit -22.4 -48.3 -21.3 -12.5
Bank bailout net expenditure/receipts -3.8 -31.5 -5.7 +1.6
Underlying Deficit (excl. bank bailouts) -18.6 -16.8 -15.6 -14.1

Fig.1 – General Government Deficit Excluding Effects of Bailouts for Bank Shareholders and Bondholders, €bn. Source: Department of Finance

There is another factor to be taken into account. Hardly anyone suggests that the reduction in government investment is a welcome development. Even supporters of ‘austerity’ suggest it is nothing more than a temporary evil, or an unavoidable necessity. The government has pledged not to cut it further.

As a result, while it has a significant bearing on the economy, it is not strictly part of the ideological offensive supporting austerity at all. Therefore it is worth looking at the underlying deficit (excluding both bank bailouts and the effects of growth) after taking into account the government’s own reduction in investment (Gross Fixed Capital Formation). Without cutting investment sharply the deficit would not have been on much of an improving trend.

2009 2010 2011 2012
a. Underlying Deficit (excl. Effect of bank bailouts & growth) -18.6 -16.8 -15.6 -14.1
b. Govt. GFCF 6.1 5.5 4.0 3.3
c. Underlying deficit, (excluding investment & bank bailouts) (a-b) -11.5 -11.3 -11.6 -10.8

Fig. 2: Underlying Current Deficit (excluding bank bailouts), removing cuts in Government GFCF, €bn. Source: Author’s calculations, Department of Finance

On this measure the trend in the deficit is still downwards, but only marginally so. Once both the effect of the bank bailouts and the cuts in government capital investment are stripped out, the decline in the deficit is a paltry €700mn since 2009.

Unsurprisingly, while the economy has stagnated since the slump so has the underlying deficit. The chart below shows the trend in GNP and the underlying deficit since 2007. In effect, a slump has been followed by stagnation. The deficit is a mirror image of growth; a sharp rise has been followed by a flatlining deficit. The modest improvement in 2012 as whole reflected the moderate uptick in economic activity, which gave way to renewed recession at the end of 2012.

1_aMBGraphGNP_underlyingDef

The underlying deficit is not really on an improving trend. It remains dependent on growth, which itself remains elusive.

Supporters of austerity in Ireland maintain that export-led growth will be the salvation of the economy. But recorded exports have already risen strongly without lifting the economy out of Depression and there is a question mark about the continued strength of exports in the period ahead.

There is also a larger question looming. Ireland is a capitalist economy and set to remain so for a considerable period. Yet its capitalists have stopped producing capital. The implications of that startling fact will be addressed in a further post.

 

via Irish Left Review | The Deficit is Stagnating, Just Like the Economy.

‘A Revolution We Can All Dance To’ (Part 1)


In this two part interview Andrew Robinson introduces the political philosophy of Gilles Deleuze. In this first part Andrew discusses Deleuze’s political concept of ‘desire’; its radical promise as well as the dangers of cooptation.

Gilles Deleuze is famous for the statement ‘desire is revolutionary’. Presuming that Deleuze was not championing the politics of consumer capitalism, what did he mean by the phrase and how could a politics of desire promise to reshape our political landscape?

The phrase “desire is revolutionary” has different connotations today from what it had when it was written. Today, it sounds like it could be an advertising slogan! But when it was written, it was really mouldbreaking. Deleuze was part of the ‘68 generation, the extended conduits for the most recent great revolutionary wave. The Deleuzian vision is very similar to what the Situationists call “non-renunciation”. We shouldn’t surrender our desires to the system, or renounce them to become a good subj

In what sense mouldbreaking? What came before it?

The dominant stance before ‘68, was a kind of authoritarianism which was radically opposed to desire. Not only the right, but a lot of the left were like this. Authoritarians reject desire and identify with various images of order and propriety. Because they repress their own desire in order to conform, they become afraid of desire. So they look for scapegoats—other people who they think are having too much enjoyment, not renouncing enough. In Deleuzian theory this is associated with reactive desire, fixed identities and ‘microfascist’ tendencies. A quick skim through the comments on news sites will show how active this type of personality still is.

But, at least on the surface, desire is something which capitalism seems keen to embrace.

Yes. Today, the dominant stance of the capitalist system is a bit different. Capitalism has used the aesthetics and language of ‘68 to elaborate new forms of domination. People are told to be empowered, to be who they can be, to make the most of opportunities. People are meant to be rational subjects, aiming for “success” in terms of conventional goals. In many ways, it’s a recuperation of the outburst of ‘68.

But scratch the surface and it’s at least as repressive as the old authoritarianism, because there is no space for difference past a certain point. Not only is difference not recognised, but it’s seen as a threat, a disruption. It has to be excluded absolutely from public spaces, or even from life itself. This is still a renunciation of desire. The underlying desires are subordinated to the ‘self’ and its life-project, they’re suppressed in the name of the person (the good subject) someone is trying to become. Whereas the desires should be deciding what kind of people we’re trying to become.

So what is presented as a ‘liberation of desire’ is really nothing of the sort?

No. At the moment, for most people, the system is deciding. So desire is allowed, but only if it’s a recognised desire. Not to desire squats where there are empty buildings, graffiti where there are blank walls, or free parties where the cars are meant to be. Not to desire land rights in Chiapas, electricity in Soweto. Deleuze is looking for a world composed only of networks. Capitalism uses networks, embedded within hierarchical structures of knowledge and power.

Desire is revolutionary because, when it follows its course, it leads outside the various social apparatuses such as capitalism and the state. It causes people to form combinations, points of energy, configurations of force which aren’t accountable to dominant social norms or systems.

‘Configurations of force’ sounds more ontological than subjective (ie. to do with the nature of existence rather than perception)

Deleuzian revolutionary desire isn’t the same as conscious desire.  It’s about specific desires people have, but it’s also a kind of general force, like the Force in Star Wars.  And it’s a term for ‘assemblages’, for the production of connections.  All the specific desires and assemblages are expressions of the underlying force of desire, its ‘differenciation’ as Deleuze says, its splitting into difference. But some of these expressions flow smoothly from the underlying force, and some of them turn against it, or get trapped in fixities which block it.  At the base level, desire is always revolutionary, because flows of becoming escape particular orders – desire as force is always revolutionary. But desires can be turned against themselves – turned into a desire to suppress desire.

Desire is revolutionary when it is:

[The] schizorevolutionary type or pole that follows the lines of escape of desire; breaches the wall and causes flows to move; assembles its machines and its groups-in-fusion in the enclaves or at the periphery” (Anti-Oedipus)

There’s something about this which feels tremendously revolutionary to me. It’s almost possible to feel horizons opening up, other worlds becoming visible. It implies that everyone matters. We’re all part of the great flow of desire. We shouldn’t be valued by how closely we conform to some particular model. Each of us is a ‘singularity’ as Deleuze calls it, a unique point in the flow of desire, and at the same time part of this flow.

It sounds quite individualistic.

On the one hand, it’s an ‘egoist’ stance, a bit like Stirner. It’s a middle finger to the people telling us to conform and fit in. But it’s also a deeply compassionate stance, looking for the magic of desire in others, the combinations of affirmative power, rather than their usefulness or social position. And it’s a stance which allows us to embrace change and becoming, but at the same time, to reject unwanted changes, to distinguish becoming from capture.  It’s not simply the replacement of one dominant system by another. It’s a world where all worlds fit, a world where everyone makes their own world.

This is a theory which speaks to those of us on the outside or on the margins – those of us who feel radically alienated from the dominant system – that our desires matter, that what we are matters. It cuts like a scythe through the ideologies which say that we only matter if we’re productive, or conformist, or successful, or law-abiding. And against the common view that life can’t go on without renunciation, it offers a vision of a different world, a world without renunciation, without hierarchy or control, without hatred for difference, without exclusion or marginalisation.

Is there a danger with a desire that is necessarily parochial rather than universal? For instance it is quite possible to imagine a desire that is not reactive (it affirms newness, makes novel connections, is horizontal, etc) but is nonetheless one that is more or less indifferent to the plight of the powerless and dispossessed.

I think you’re right, that it’s possible in a Deleuzian approach for someone to actively desire something which is unsustainable or unjust, or at least indifferent as you say.  It’s possible but not common, because Deleuzian theory rejects a lot of the dominant configurations as reactive –I guess we’d be getting into issues of the extent to which desires constructed through mass consumer society are active, and whether they’d persist in the absence of capitalist machineries for managing desire.

There are several resources in Deleuzian theory for addressing these kinds of things.  The first is that Deleuzian desire constructs a kind of meta-ethics of supporting active desire.  In a sense, an active desire which is educated, which is aware of the forces which threaten it, will form a general opposition to hierarchical forces and to forces which produce scarcity.  Secondly, people are seen as divisible, molecular selves with connections to other people, objects and so on.  Compassion therefore is most likely part of desire.  It isn’t something counterposed to our desires.  Thirdly, there’s a critique of desire within capitalism.  Capitalism doesn’t really believe in desire.  It believes in preferences and self-interest.  Capitalism tries to manipulate desire, to turn it into self-interest or market demand.  Of course this means that there’s always scarcity, that people are always competing, and that people will consume unsustainably unless something stops them.  Deleuze rejects this view of desire.  He thinks desire is primordially abundant and affirmative, not scarce.  It’s about forming connections, not possessing.

You may have partially answered this question but what about the argument that addressing some of the world’s most pressing problems (global warming, the unequal distribution of wealth etc) necessarily entail people in the first world being prepared to give up their desires for certain luxuries?

I think Deleuze would expect liberation to come from the rebellions of the excluded and oppressed, not from the in-group renouncing its privileges.  Deleuze is in favour of diffuse, decentralised forms of power, which are focused on local intensities and not on “power-over” – the band or pack, the war-machine and so on.  When power takes this form, the local group will defend itself militantly from exploitation and inequality, and from the destruction of its environment, which is a site of lived intensity.  Look at the Mapuche, the OPM or the Zapatistas, or the Bougainville revolution, or the Chipko movement.  This is what happens when local groups act on intensities using diffuse power.  On the other hand, Deleuze is all for the in-group renouncing its privileges – it’s called “becoming-minoritarian” in his theory – and sees this as a broadening and liberation of desire, an escape of desire from fixed categories.

I think the problem is mostly apparent rather than real.  Deleuze rejects renunciation, and therefore rejects the line of response which sees a law, a normative code, a generalised repression as the guarantee that desire will not exceed what is just or sustainable.  Again in capitalist theory, we’re assumed to be self-interested first of all, and any kind of concern for others has to be imparted later – through market forces or deterrent punishments or some other controlling force.  I’m not convinced that this works for a number of reasons.  One of these is, once certain people have the concentrated power in their hands to force others to conform, why wouldn’t they use this power for self-interest instead of the common good?  Another is that this kind of attitude—the constant suspicion of others, the vigilance of constantly looking out for free-riders and shirkers—is actually corrosive of compassion.  It produces reactive closure.  Think of those authoritarians in the comments sections again.  They go on and on about concern for others, about not doing what one wants, but they don’t seem to have much compassion for anyone else.  This might be because their worldview has misanthropy and scarcity built into it.

But scarcity from an environmental perspective is real.

Deleuze and environmentalism might seem a bad fit, but there are radical ecological theorists whose concepts are very similar to Deleuze’s—Feral Faun and John Moore for example, or Derrick Jensen’s “Beyond Hope”, or the article “Desire is Speaking” in the Earth First! journal Do or Die.  It all depends where one situates the locus of active desire.  If we think of desire in terms of forming connections, living the intensity of lifeworlds, creating spaces of existential abundance, then there’s a lot of overlap between Deleuze and deep ecology.

Andrew Robinson is a political theorist and activist based in the UK. His book Power, Resistance and Conflict in the Contemporary World: Social Movements, Networks and Hierarchies (co-authored with Athina Karatzogianni) was published in September 2009 by Routledge.

via New Left Project | Articles | ‘A Revolution We Can All Dance To’ (Part 1).

via New Left Project | Articles | ‘A Revolution We Can All Dance To’ (Part 1).

Anti Capitalist art and Posters


Anti-capitalism 1911 english

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capitalisam

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Communist Propaganda poster by Viktor Deni reading ‘Either we kill capital or we die under the heel of capital’, 1919.

00-unknown-artist-the-golden-idol-of-the-lord-of-world-capitalism-1918-20

The Golden Idol of the Lord of World Capitalism
Unknown Artist
1918-20

00-n-kogout-in-gods-country-that-is-the-usa-bezbozhnik-1930

In “God’s Country”, That Is, The USA
N Kogout
1930

00-unknown-artist-no-1970s

NO!
Unknown Artist
1970s

00-unknown-artist-third-international-1920s

Third International
Unknown Artist
1920s

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An Economic Alternative to Exploitative Free Market Capitalism


In 1649, a group of English communists started fighting the notion of private property in what became known as the commons movement. They were using the unstable period in England’s history to introduce a new economy, one that would see land, wells and other means of wealth as shared resources. This group would prevent a small class of people from collecting and consolidating the rights to basic human life, such as water and food. In an annual celebration that doubled as a protest, they would circle the village commons and level or dig up any hedges and fences that designated spots of private ownership. They became known as the “levelers” or “diggers.”

The movement, which was subsequently quelled in 1651 by landowners and the Council of State, has seen a revival in the past decade. It remained dormant for so many years because of its fundamental threat to modern economics, putting community needs at the center of society rather than those of the individual.

The commons protects large resources from privatization, such as the lobster fisheries in Maine or grassland management in Mongolia, and allows collectives to regulate extraction. Exploitation is avoided because no one individual has more of a right to the source than any other.

“[The commons]” is “an intellectually coherent way of talking about inalienable value, which we don’t have a vocabulary for,” David Bollier, author of “The Wealth of the Commons,” said in a conference Tuesday at the Heinrich Böll Foundation in Washington, D.C.

It is a way, Bollier says, of formally introducing the “political, public policy, cultural, social, personal, even spiritual” aspects of life into our economic system, which now, he says, can deal only with monetary value.

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“You could say that it’s a different metaphysics than that of the modern liberal state,” he says, “which looks at the individual as the sole agent.”

The commons movement is a reaction to exploitative free market capitalism. It rejects the notion that resources, spaces and other assets are purely a means to wealth. It condemns the privatization of public works, such as the parking meters in Chicago, which allows the sovereign wealth fund that controls it to increase the rates.

When an economy allocates wealth to private entities, Bollier says, those property rights inevitably get consolidated until a few large institutions control its means.

Instead, he says, we need to protect the commons with rules that bar individual ownership of that property. It is not, however, a space that is left as a free-for-all; it still has regulations and state recognition that prevent private groups from exploiting it.

The commons introduces a “role for organized self-governance as opposed to government,” Bollier says, “although they can be made complimentary.” The community manages the resource and has an involved interest in keeping others from decreasing its supply, he says, because the license belongs to the public.

But the commons is not restricted to natural resources—it extends to the Web, science and other technologies.

The Internet has become the setting for a fierce battle between public advocates that would like to designate forums as open and free, and companies that seek to control more of its content through bills like the Stop Online Piracy Act (SOPA) and the Protect IP Act (PIPA). Many programmers have handed over their copyright ownership to the public in the form of General Public Licenses and Creative Commons licenses, which allow the public to use and contribute to forums without having to pay for usage. It also keeps companies from using personal information, as with Facebook, to target potential consumers.

Additionally, one-fifth of the human genome is privately owned through patents. Salt Lake City-based Myriad Genetics, for example, owns the breast cancer susceptibility gene, which guarantees monopoly control over research into cancer. It discourages many other researchers from exploring treatment, something that could ultimately stunt our capacity for medical advances.

The issue extends further: Monsanto uses Genetically Modified Organisms to displace natural seeds, multinational water bottle companies are privatizing groundwater, and software companies retain copyrights on mathematical algorithms that others then cannot use.

“Enclosure,” Bollier says about patents and private ownership, “is about dispossession. It’s a process by which the powerful convert a shared community resource into a market commodity … This is known as development.

“The strange thing about the commons is that it’s invisible because it’s outside of the market and the state,” Bollier says. “It’s not seen as valuable and isn’t recognized because it has little to do with property rights for markets or geopolitical power … but there’s an estimated 2 billion people around the world whose lives depend upon commons like fisheries, forests, irrigation water and so forth.”

The neoliberal market does not, paradoxically, grasp the purpose behind the commons. Our current system is one-dimensional, Bollier says, and is designed to attach a price to everything.

For years, sustainability experts have sought ways to incorporate moderation and conservation into the neoliberal model through such incentives as cap and trade. But companies, Bollier says, will pay the extra fees until it is no longer economically viable, proving that in a system of privatization, people are willing to shell out penalty payments as long as they do not disrupt their profits.

“There’s an allure in trying to meet microeconomics and neoliberal economics on its own ground,” says Carroll Muffett, moderator of the discussion and president of the Center for International Environmental Law, “to say ‘if you want to put a price on everything, here’s the price for this and look how massive the price is,’ whether it’s access to water or it’s pollination … but for me the danger is: Is meeting them on their own ground what we should be doing? Is there an inherent compromise in there that risks giving up something that ultimately cannot have a value put on it?”

Until recently, Bollier and Muffett say, there has been much wiggle room for the free market to expand. But as the basic needs of fresh water, energy and food are being overproduced or vanishing because of climate change, companies are finding that their only options are to draw from the scant resources of Third World communities to meet their profit margins. It is a test to see what, in the end, neoliberalism holds higher in value: money or life.

Muffett says that question has already been answered in the building of the coal-fired Medupi Power Station in South Africa. An assessment of the power station projected that there wouldn’t be enough water to keep the plant operating and meet the needs of the local community. The watershed adjacent to the plant is already so overtaxed that it doesn’t reach the sea. The company, Eskom, proposed to reroute water from another watershed for its main operation and use the local supply for its filtration system. It would raise the price of water for the community to keep “poachers” from draining the source.

“The water that’s being poached,” Muffett says, “is to give people access to fresh water and to water their crops for subsistence living.

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“Putting a price on that for a community is ultimately missing the point. The water isn’t fungible. If I give you my gallon of water and you give me $1,000, I can’t drink the thousand dollars.”

Both Bollier and Muffett say this is the result of an economy based on the philosophies of Thomas Malthus and John Locke, whose models do not guarantee the right of existence. To exist, one must have money. It becomes the defining characteristic of life.

“That’s the risk in the natural capital approach,” Muffett says. “It’s saying ‘if you give me a thousand dollars, that’s a substitute for my bees, my pollinators, for the land where my ancestors are buried.’ And there is no substitute for that.”

This article was made possible by the Center for Study of Responsive Law.

via An Economic Alternative to Exploitative Free Market Capitalism – Truthdig.

via An Economic Alternative to Exploitative Free Market Capitalism – Truthdig.

Soviet propaganda posters – Socialism vs Capitalism


Posters that “showed” Soviet people the difference between socialism and capitalism.

Comment: These posters remain a valid commentary on capitalism and its rapacity, exploitation and illusory promises. If you are not part of the capitalist class, it is a bargain with the devil who promises wealth down the road but instead delivers economic destruction and caprice with no way out. It is a system propped up by the psychology of the lottery: there are most certainly winners and one is asked to believe that you will be one of them in exchange for your labor and (most importantly), time. What is not revealed is that the “reward” if at all forthcoming, is outrageously minuscule compared to the time and effort expended. In short, freedom to work in capitalist hell.

About 20 millions of American people don’t have enough money to buy more than 1 liter of milk per month and 6 kg of meat per year.

They have plenty of goods for rich people only, and we are going to give goods to all the people.

Who has the national income?

Exploiters have the majority of it in capitalistic countries.

Working people – in USSR.

n the countries of capitalism – the violation of working people rights

In the countries of socialism – the right to work

In the countries of capitalism – the path of the talent…

In the countries of socialism – the path to the talent!

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via Socialism vs Capitalism propaganda posters · Russia travel blog.

via Socialism vs Capitalism propaganda posters · Russia travel blog.

US scientists discover chimps lack ‘innate sense of capitalism’


Researchers from the fiscal chimp center at Emory University have failed to find capitalism coursing through the brains of our ancestors. Goldman Sachs says this is good news and are in the process of creating a  credit default swap to cover all monkey business

In an experiment involving a banana and a top corporate lawyer, the apes were given the opportunity to invest their fruit, or starve each other to death.

“The results were disappointing”, said Dr Hillary Temple. “Not one of our subjects showed any ambition to own all of the bananas.”

“It’s almost as if they didn’t hate their fellow chimp.”

“Some of them went so far as to share their curved food portfolio with other hungry little apes, without so much as a punitive contract in place.”

“I’m beginning to think we descended from a bunch of pinko liberals.”

Capitalism chimps

Temple also wanted to find out what chimps made of patent law and restrictive trade agreements, but was disappointed to find the best they could manage was a makeshift hat.

“Not a single chimp filed a lawsuit for infringing copyright on peeling bananas with your feet”, sighed Temple. “In fact some of them threw their own faeces at the lawyer.”

The team has concluded that chimps are a bunch of dangerous communists at best, and are looking elsewhere for economic theory in nature.

“The ebola virus looks promising, it eats the host in the face and then keeps going until there’s nothing left”, said Temple.

“It’s incredible to think that low forms of  life have a better grasp of consumer capitalism.”

Read more: http://newsthump.com/2013/01/15/us-scientists-discover-chimps-lack-innate-sense-of-capitalism/#ixzz2IJ4HbyMx

via US scientists discover chimps lack ‘innate sense of capitalism’.

via US scientists discover chimps lack ‘innate sense of capitalism’.

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