Parts of the left are attributing the current global economic crisis to political causes. Neoliberalism, so the argument goes, with its total deregulation of markets and particularly the radical increases in freedom accorded to the financial markets, has failed. Now, they claim, we are approaching an era of regulation and control by the state, and our task is to influence the forms it will take. The central demand is for the rolling-back of the influence of finance capital and a strengthening of the real economy, which in turn should itself be reformed both ecologically and socially. Whether or not this will succeed is treated primarily as a question of the balance of social power and of political mobilisation.
However, this analysis overlooks the fundamental character of the global crisis. Even if it was precipitated by a financial market crash, its causes are to be found somewhere else entirely. The prodigious inflation in the financial markets over the last 30 years was not caused by wilful or incorrect political decisions, but is the expression of a structural crisis of the valorisation of capital, a crisis that began with the end of the post-war Fordist boom. Through the fundamental reorganisation of conditions of labour and production in the course of the third industrial revolution (automisation, flexibilisation and precarisation of labour, transnational chains of value-creation, etc.), there was a massive rationalisation of labour in the central capitalist sectors. This substantially undermined the foundation of the valorisation of capital, which consists in the continually increasing exploitation of labour-power. This in turn led to the diversion of more and more capital into the financial markets: capital could no longer find sufficient opportunities for valorisation in the ‘real economy’, and a gigantic bubble of unsecured ‘fictitious capital’ (Marx) was inflated. Without this diversion, which allowed the crisis of capital-accumulation to be postponed, the global economy would have collapsed long ago. The cost of this diversion, however, was the building-up of ever more potential for crisis. It is thus no wonder that the crash came: what rather needs explanation is that it could be so protracted.
This was only possible because at the state level and beyond, policy has been primarily directed towards sustaining the dynamics of the financial markets, and has thus reacted to the onset of every crisis (those in Mexico, Asia, Russia, that of the New Economy) in the same way: with the creation of additional credit, to induce the inflation of a new bubble. The pattern of these reactions is evidence that the structural cause of the crisis-process lies beyond the reach of politics, for it is a result of a fundamental contradiction in the historical internal dynamics of capitalism, itself a prerequisite of all conscious action. Capitalism creates immense forces of production and potential for riches which in and of themselves would enable a good life for everyone (really, for everyone). These riches are however not compatible with the narrow- minded aim of exploiting living labour, because they render more and more labour superfluous. They thus
lapse into becoming the propellant of a fundamental process of crisis, which undermines not only the foundations of the valorisation of capital, but also the network of social reproduction that depends on it, along with the natural foundations of life. The inflation of the financial markets is not the cause of the crisis, but one of its symptoms. It shows that capitalist accumulation can only function precariously as an appendage to fictional capital.
In this context the actual content of the much-evoked ‘return of the state’ becomes clear. Despite all the lip-service paid to ‘regulation’ and the return to the real economy, supporting the financial markets and inflating a new bubble of speculation and credit will continue to remain at the centre of every policy of crisis-administration. Even left-wing social democrats, trade unionists and ATTAC-representatives are bound to demand that the banks be saved. The only differences lie in the detail – that is to say, whether or not they should be nationalised, and who should bear the cost. This last question is however already resolved: the costs are so huge that they can only be covered by massive public borrowing. Everything else (‘tax the rich’, salary-cuts for managers, bankers’ private liability etc.) is merely symbolic. There is fundamentally nothing to be said against taking money away from the rich, bankers and employers in order
to distribute it to claimants (as if it would ever happen), but the function that these demands fulfil in political debate is regressive, because they serve only to brand scapegoats and to diffuse moral outrage, thus masking the true dimensions of the crisis.
Alone the massive public borrowing to save the financial system suggests – even if it succeeds in precariously delaying the process of crisis with a violent surge of money – that in the next years many aspects of social reproduction will be cut back because they are no longer deemed ‘financially viable’. But the sums needed to repay the amassed debts will never be saved through restrictive policies of austerity. It is therefore not in any real sense the case that the mass of waged, precarised and unemployed workers will have to pay them back. It is these workers, however, who will feel the effects of the ‘bailouts’ most acutely, because the debt will serve as a brutal restriction on every future politics, no matter for which party or tendency. For while there will be limits to future public borrowing, the burden of interest-payments will grow massively. The consequences are obvious: politics will in the first instance concentrate on the maintenance of ‘functions relevant to the system’, and these are, in addition to the financial markets, the remaining cores and ‘clusters’ of productive valorisation of capital, along with the infrastructure and personnel that they require. General infrastructure, social welfare, public healthcare will be dismantled further, wages and pensions decreased (through cuts and as a result of inflation), and the number of precarised and ‘superfluous’ people will continue to grow. Administration of the crisis, for them, means soup kitchens, authoritarian discipline and exclusion. Even political parties that come to power with promises of ‘social and environmental reforms’ will follow this logic of the political crisis-administration.
The current debate about reforms is a farce, because it suggests a perspective for which the material foundations are no longer present. During the boom-periods of capitalism, and particularly in the times of the Fordist post-war boom, a relative improvement in living- and living-conditions – was possible within the framework of capitalism, because the growth-dynamics of the movement of valorisation brought about pressure to integrate increasing numbers of people into the system of commodity-production and labour- exploitation. Since more and more have been rendered ‘superfluous’ from the point-of-view of capital, the function of ‘politics of reform’ is being reduced to the organisation and facilitation of the increasing social and regional fragmentation of society. This tendency will become more prominent in the further development of the crisis. A new perspective towards social emancipation can only be formulated in the consistent opposition to the dismantling politics of crisis-administration: through the consistent attempt to make the standpoints of material riches and of the satisfaction of sensual needs apply to everybody. This is as true for struggles over wages and labour as it is for those which aim at the direct, collective appropriation of social resources (means of production, housing, cultural and social spaces etc.). As long as riches can only be thought in the value- and commodity-form and access to material riches appears possible only via the detour of money, the restrictions and insanities of this form will in the end continue to be presupposed and accepted. It is in this way that large-scale shut-downs of production-facilities in which useful and sensible things (such as good food) are made appears ‘unavoidable’, while at the same time there are bitter struggles to continue and expand the production of cars, although their climate- destroying effects have been widely-known for a long time. This blocks the only way out of the destructive course of commodity-society, a process that starts in our heads, and proceeds, as if as a matter of course, in our actions. Our task is to break through this blockade.
Translated by Josh Robinson (Principia Dialectica)