These troubled economic times coupled with the disturbing distance political and media elites have travelled to the right will move us to action. The question of 'when' is pressing. The absence of organization and serious discussion about moving forward (from Occupy Wall Street protests) is troubling, to say the least. Perhaps the time to actually organize in ways that have a substantial impact has arrived.
It has become obvious that capitalism has ripened and has become not capitalism but monopolism. We have entered a period of tremendous instability. On the path we are on, we will eventually stabilize into third world conditions. It's in the cards.
The powers that control our societies have taken an increasingly ominous and threatening tone. Unapologetic in their contempt for rule of law or human rights, they are sending messages, repeatedly, that force and fear will replace the friendly face of social programs. The state itself is morphing from the apparent sweetness of Keynes to the bitterness of Ayn Rand and Machiavelli. The reason for this is the predicted transmutation of capitalism to mafiaesque monopolism.
The state and private business are married and stand over and above societies and we, powerless to govern ourselves, helpless in our troubling and increasing deprivation, wait for a master to take care of us. The time is coming where we, individuals and members of various societies must take the initiative to move ourselves a fraction; from late capitalism to early socialism. Don't be alarmed. Early socialism should and will look like late capitalism but at that point, we will have switched tracks. Our trajectory will have changed and we will be on the road to the abolition of state barbarism and naked selfishness toward true democracy and stable societies.
Our Historical Dilemma
The latter part of the 20th century gave witness to a period of prosperity throughout developed nations that was truly impressive. Memories of the Great Depression of the 1930s faded and the momentum of post war enthusiasm showed the world that the cynics and the malcontents were wrong. Capitalism has lifted us from the muck of feudal tyranny and misery. It had rendered communism and socialism a joke. History was finished. The excessive inequality that is part and parcel of raw capitalism was buffered by Keynes. His magic formula was up and running and the general notion was, the sky’s the limit. The trajectory was clearly upward.
Behind the scenes however, problems emerged. Economists began to question the stability of capitalist based economies. In the 1970s, a century of rising real wages came to an almost unnoticed end. In the 80s deficits became more an ominous threat than ever. The narrative began to crack. Keynes solid ground had weakened. New radical and bold neo liberal policies were widely promoted, especially by right wing think tanks. De-regulation and globalization found their way to the collective lexicon. Thatcher and Reagan led the political direction away from the social safety net and toward a new era of unbridled finance capitalism.
Stagnation and the reduction of real wages would have enormous consequences for the capitalist classes. The remedy for this was not a remedy at all. The problem was masked through credit. The party could continue. This has been but one of many schemes that have built up an illusion of stability. It was primarily aimed to continue the flow of money into the pockets of the very wealthy.
Another deeply relevant event occurred in the world of state capitalism. At the end of the 80s, communism died a silent and bloodless death. It died of old age and morbid stagnation. It was buried on the ash heap of history. The Western world could celebrate. The time had come for the ghost of Karl Marx to finally rest in peace; it seemed.
Now capitalism could operate more easily. With the cold war left to historical analysis, capitalism was now free to express itself more freely. There would be no more racing to the moon or building social safety nets aimed to be more impressive than the public sphere of communism. The time for authentic capitalism had arrived. The Keynesian model had been failing. The time had arrived for the resurrection of classical economics re branded as 'new'. Even though it would be branded with the prefix ‘neo’, there was nothing new about it.
Essentially there are two models for capitalism; the classical model (read Dickens) where you sink or swim or, the Keynesian model where a social safety net softens the hard edges; the places where the American dream could not reach.
Liberalization of the financial world (neo liberalism) was promoted as a means to generate wealth by allowing investors to acquire as much wealth as they could with as few restrictions as possible. This increased wealth, it was argued, would raise all ships. It is where capitalism is free, they argue, where most wealth is generated and consequently, ordinary citizens are most affluent. This line of argument ignores the fact that the best quality of life across the board has been in nations where generous social programs, high wages to workers, and a generous and healthy public sphere made that quality of life possible for everybody. The good life occurred where equality had been a political priority. On the other hand, nations that have accentuated inequality are the most tense socially and most unstable politically and economically.
Classical or neo liberal economists will argue that it is the free market that best regulates prices, wages, and demand. The market is democratic and what people want, they will demand. The free market is efficient and the competition that exists between firms will increase efficiency. And in that effort, technology as well as processes becomes ultra-efficient. That efficiency not only made it possible to produce very cheaply with far less labour input, it also made it possible to move capital around the globe at the flick of a switch and then, with even less effort. Playing with money became far more attractive than producing things.
The layers of economic illusion including selling sub-prime loans and the financial voodoo among bankers and investors cannot hide the underlying reality. The loss of wages among the working classes may not matter in the heat of short selling and hedging. The soulless masters of the capitalist world continue to pretend there is money, somewhere, to make good the enormous wealth that exists on paper but the bottom line is, every dime of real wealth including the wealth they 'own' begins with work. The genesis of wealth is rooted in the production of goods and services. Financial voodoo does not create wealth. When those chickens come home to roost (and they are) they will discover, and so will we, that all that wealth they accumulate through magical financial wizardry has no basis in reality. In other words, the real adults (workers) don't have jobs and cannot pay the bills. We are in trouble.
Old Age, Sickness, and Death
It is precisely the things that are the strengths of the so called free market that are its fatal flaws as capitalism matures. If capitalism could survive long enough, it could produce all the goods and services human beings could consume, very easily. The problem with that scenario is that everybody is out of work in that scenario, there are no paycheques. Consequently, there is no demand. An additional problem with that scenario is the distribution problem.
Capitalism has been the driving force of a stage of human development that, in many ways, has served us very well. The wealthiest of 19th century merchants or kings could not imagine the quality of life enjoyed by the middle class of the late 20th century. Capitalism has had its day however. It's useful utility has passed. Although it lives only as a mental abstraction, like any entity in the natural world it cannot live forever. Its very energetic and dynamic nature and concomitant instability, its intense energy, naturally results in a relatively short life span. It lasted longer than Marx had imagined however thanks to John M. Keynes.
The years ahead will be tumultuous. Without the calming salve of social programs to quell social upheaval, neo liberal inspired governors will become increasingly fascistic in efforts to stem the tide of social unrest. Keynesians will aim to return to the old world order but at this point this scenario isn't possible or even desirable. Keynes strategy was to protect capitalism from its own demise. Moreover, the maturation of capitalism, the window of opportunity to squeeze profit from a unit of labour has almost vanished and without that excess, the possibility of funding social programs through taxes from workers pockets is substantially reduced.
At this point the chickens 'have' come home to roost. The afterglow of capitalism's long run was sustained by a dot com bubble, by various other bubbles and pyramid schemes and most recently, by creating liquidity through quantitative easing (read: printing money). The notion that we need our too big to fail capitalist masters to take care of us is wearing thin. Big money and their minions have kicked the can down the road about as far as they can. They are running to a dead end.
Millions of jobs in the so called developed world have gone and there is no way they are coming back. They are gone thanks to technological efficiency; the same efficiency makes it much easier to open up the so called second and third world to manufacturing and a 'new and improved' neo liberal brand of consumerism.
To say that rising real wages has ended understates the severity of the situation. The jobs that had paid for roads and bridges and schools and social care and a decent standard of living are gone. Our infrastructure, schools, roads, social programs, is crumbling. The beginning of an ugly death spiral has started and there is no way out.
The wealthy classes and the right wing (their accomplices) had been demanding cuts in worker's wages throughout boom period. They have won. They got their wish. (Be careful what you wish for.)
The Paul Ryans and the rest of the so called libertarians call for less regulations and taxes on the private sector and consequently, the further impoverishment of society as a whole, is becoming more suspicious to the public. At some point, a critical mass will realize that the ideology of neo liberalism was a rather simplistic (albeit complicated in terms of financial gyrations) scam intent on funneling large quantities of wealth to the very rich at the expense of everybody else. At that point, Paul Ryan and the rest of the capitalist classes will be on very thin ice. No Homeland Security, no militias, no threats from the state or political bullshit will stop the outrage and revolutionary upheaval of the American people. The same holds true for Canada, Europe, and for working classes everywhere. Not only will the integrity of phoney wealth vanish, they themselves will be in real danger. They have been the ultimate traitors.
We've become dependent on gangsters and criminals. We've become addicted to the crack they sell. The time that we need to depend on ourselves is either very close or it has already arrived. We need to do more than occupy Wall Street.
We have always depended on each other. It has always been the efforts of other workers that produced all the goods and services you needed and enjoyed. At this point we need to develop ways and means to organize work to produce goods and services for each other, for our families, and for our communities.
The time will come when revolution will not be a choice. Reality itself will demand it in the requirement to meet human needs. We are fast approaching a point where we will need to produce and distribute goods and services. The need will be/is vital.
We first must recognize that it is not investors that actually produce and provide goods and services. It is you and me. The absurdity of factories rusting while millions look for jobs, while millions do without the goods and services they need; the absurdity of millions homeless while homes lay empty is screaming at us. Those suffering screams compel us to end our reliance on wealthy investors to make things happen.
To do this we need to organize. We need to work. If ever there was a time for us to think outside the box, it is now.
One way to do this is for workers to organize industrial production and for the workers that actually produce to be the board of directors for that enterprise. What is important is that while those workers are in control of surplus, that surplus have a mechanism to social responsibility.
Another element to this will require the focus of research and investment to be attuned to both local and international needs. The old paradigm's outcomes meant much research on getting an edge on making a tastier hamburger (not that there's anything wrong with that on its own) as opposed to research on or providing medicine to people suffering from various diseases. The focus must be on alleviating the suffering of those that suffer most.
While productive workers must have decision making power over their own work and what it is to be used for, input from the community truly democratizes the process. Industry that does not respond to the needs of the community is not worth anything to the community. Integration between producers and consumers (the community) is vital to the democratization of free enterprise.
On the public sphere, municipalities make decisions on what they need and want. If the citizens in a town want to make their town a version of a resort, the national government supplies the expertise to build the pools, the tennis courts, the landscaping and as needed, the supplies. The locals provide the labour.
To get there, to get to the place where we can realistically take back control of our workplaces, our communities, and our nations, we must take control of the state from the gamblers and the criminals. That will take organizing and it will require much effort. But it is not futile. The very same thing has been done and is being done in Venezuela.
As a collective and individually, we cannot be held hostage to old and archaic paradigms. We can no longer afford to submit to the master-slave dialogue. We need to build our own communities and workplaces. We need to provide for ourselves and each other.
We need to understand that the reality has always been, their wealth is based in our work. We need to understand to our bones that our wealth is our work. It does not come from 'them'. It never did.