[P2P-F] Fwd: Fw: David Harvey on marx and capital

Sat Dec 31 21:31:04 CET 2011

Can you see a way out of the crisis?

>From what i understand, getting out of the crisis means either the physical
destruction of capital or its devaluation through bankrupcies.

For this reason, I see no way out of this if something radical is not done.
(revolution, war, )
2011/12/31 Michel Bauwens <michel at p2pfoundation.net>

> I'm afraid you are right and this is also being echoed by samir amin,
> michael hudson, and others,
>
> Michel
>
>
> On Sun, Nov 27, 2011 at 5:29 PM, Tere Vadén <tere.vaden at uta.fi> wrote:
>
>> I have a pet theory which is too simplistic and reductionist to be true
>> or even intelligible to many, but this is it: since economic growth is
>> not possible anymore (because of peak oil) the rich can get richer only
>> if the poor get poorer, hence authoritarianism, hence austerity, etc;
>> some of the old pre-20th century conditions are returning. The system is
>> not surviving, it is mutating. If the collapse of the soviet union meant
>> the collapse of socialism as ideology, the end of growth means the end
>> of liberal right wing ideologies. (Fortunately, I'm not completely alone
>> in believing this lunacy, Richard Heinberg seems to have spoken about it
>> in the recent ASPO conference: http://www.theoildrum.com/node/8573).
>>
>> On 11/27/11 7:58 AM, Michel Bauwens wrote:
>> > see below via thomas greco, a commentary on harvey
>> >
>> > has anyone seen any good explanation of the current austerity/fleecing
>> > strategies ... it seems to me that a systematic and radical
>> impoverishment
>> >   is also a problem for the survival of the system as a whole ..
>> >
>> > Michel
>> >
>> >
>> > ---------- Forwarded message ----------
>> > From: *Thomas Greco* <thg at mindspring.com <mailto:thg at mindspring.com>>
>> > Date: Sat, Nov 26, 2011 at 4:47 PM
>> > Subject: Re: Fw: David Harvey on marx and capital
>> >
>> >
>> >
>> > Dear Rajni,
>> > Thanks for the link to the review of David Harvey's book, /The Enigma of
>> > Capital, and the crises of capitalism/. No, I've not seen the book, but
>> > if the review is a faithful description, the book seems well worth
>> reading.
>> >
>> > I'm not inclined to frame my analyses and prescriptions in terms of
>> > competing ideologies because that leads to immediate resistance by the
>> > true believers on one side or another. Rather, we need to encourage
>> > people to think outside of their comfortable boxes by pointing out
>> > implicit assumptions and evident dysfunctions, and suggesting structural
>> > as well as policy changes that show promise of providing better
>> outcomes.
>> >
>> > Of course, what constitutes a better outcome will always be a point of
>> > disagreement based on the fundamental values, attitudes, and beliefs
>> > that different segments of society hold (e.g., the 1% vs the 99% that
>> > the Occupy movement has highlighted). Besides that, our desires and
>> > expectations must ultimately adjust to the reality of our planetary
>> > limits to physical growth.
>> >
>> > Based on the review, the points that I may agree or disagree with Harvey
>> > about are inserted in red in the review below.
>> >
>> > *The Enigma of Capital, and the crises of capitalism, By David
>> Harvey____*
>> >
>> > Review by Andrew Gamble
>> >
>> > Friday, 30 April 2010
>> >
>> > *Andrew Mellon, the US Treasury Secretary during the Great Crash of 1929
>> > and one of America's richest men, observed that in a crisis assets
>> > return to their rightful owners. Nothing much has changed. As the
>> > present crisis has mutated from a banking crisis to a fiscal crisis and
>> > a sovereign debt crisis, bonuses continue to be paid, while the people
>> > of Greece and Iceland suffer huge cuts in jobs and services.____*
>> >
>> > As the head of Citibank helpfully pointed out, "Countries cannot
>> > disappear. You always know where to find them." Once the bubbles are
>> > burst, expectations about asset values are dashed, optimism gives way to
>> > despair, and wealth is ruthlessly redistributed. *Capitalism survives by
>> > purging itself of debt and loading the costs of adjustment on the weak
>> > and the poor.____*
>> >
>> > [I agree, but something needs to be said about HOW it purges itself of
>> > debt. We’ve seen very clearly in this latest cycle how the capitalists
>> > have come away whole by pushing the debt off onto the public sector by
>> > means of government bailouts. That has cause severe fiscal (budgetary)
>> > problems for governments, which now are pressured to cut spending. That
>> > is where the weak and the poor (including the “middle class”) get
>> > fleeced and sacrificed because the cuts are typically made in social
>> > spending and programs that promote the common good.]____
>> >
>> > For David Harvey, this is the latest of the great structural crises
>> > which have punctuated the development of capitalism and which signify
>> > that major limits have been reached to further growth. Crises on this
>> > view are inherent in capitalism itself, and the means by which it renews
>> > itself. Only a periodic clear-out of debt and unproductive activities
>> > creates the basis for a further leap forward.
>> >
>> > Harvey is less interested in the detail of how the 2007-8 crisis
>> > unfolded than in understanding it as a manifestation of how capitalism
>> > works. Over the last two decades, he has become a leading exponent of
>> > classical Marxist political economy, his work known for its exceptional
>> > clarity and for integrating spatial categories into the theory of
>> > capital accumulation.
>> >
>> > Capitalism in the last 200 years has proved itself by far the most
>> > dynamic and productive economic system known to history, but the wealth
>> > comes at a price, both for human beings and increasingly for the natural
>> > environment.
>> >
>> > Periodically, capitalism over-expands and overshoots, encountering
>> > limits it cannot immediately transcend. This is a system which must keep
>> > expanding by at least 3 per cent a year. What drives it is the hope of
>> > profit, and this impulse comes to shape all social relations as well as
>> > nature. During booms, capital accumulates very fast, but the amount of
>> > surplus generated becomes harder and harder to absorb. The investments
>> > that have been made in the boom fix capital in all sorts of ways, in
>> > buildings, cities, regions and countries, as well as in labour forces
>> > and ways of organising production.
>> >
>> > After a time many of these past investments no longer yield a high
>> > return and sometimes no return at all. This is what precipitates the
>> > crisis. It may take the form of a profits squeeze, caused by militant
>> > labour wresting gains from capital, or by factors depressing the rate of
>> > profit, or by too little demand. Harvey argues that the present crisis
>> > is particularly hard to resolve because it comes after a long period in
>> > which real incomes in the US have stagnated, while the wealth of the
>> > property-owning elite has soared.
>> >
>> > The gap between what labour was earning and what it would spend was
>> > covered by credit. The average debt of per household, including mortgage
>> > repayments, was $40,000 in 1980. By 2007 it was $130,000. Getting this
>> > debt down and restarting the economy is a huge task.
>> >
>> > [I too have been preaching that the limits to growth have been reached,
>> > and yes, however one might choose to characterize an economic system
>> > (capitalist, socialist, or otherwise), there must be a periodic
>> > “clear[ing]-out of debt and unproductive activities,” for the system to
>> > maintain its vitality, but not necessarily to make way for further
>> > growth.____
>> >
>> > I’m wondering if Harvey’s book adequately explains the phenomenon of
>> > “expansion and overshoot,” and whether or not that would also occur
>> > under his conception of a alternative non-Capitalist system. I’m also
>> > wondering about the basis for his statement that, “This is a system
>> > which must keep expanding by at least 3 per cent a year.”I’ve seen
>> > estimates that run closer to 6%. My own belief is that the proximate
>> > driver of continual economic growth is the compounding of interest that
>> > is a fundamental feature of our global monetary system, and that the
>> > surplus that is created by the economy goes largely into capital
>> > concentration and profit-seeking reinvestment, rather than to increased
>> > and more equitable consumption. Thus, we see starvation and want amidst
>> > plenty.] ____
>> >
>> > Harvey is pessimistic that growth can be restarted without the
>> > infliction of quite unimaginable hardships on the many of the world's
>> > poorest people. *Capitalism survives by socialising losses and
>> > distributing gains to private hands. Harvey devotes a large part of his
>> > argument to show how this is done through the close ties of the state
>> > and finance. He calls it the state-finance nexus.____*
>> >
>> > [Yes, this is an increasingly obvious point. I’m glad to see that Harvey
>> > is highlighting the “*state-finance nexus.”*I trace that back to the
>> > founding of the Bank of England in 1694, which established the pattern
>> > of central banking and government-banking collusion that has since
>> > spread around the world and culminated in a rather monolithic regime.
>> > But there are cracks beginning to form.]____
>> >
>> > This is not a conspiracy: both sides of the relationship need one
>> > another and support one another. There are frictions and conflicts, but
>> > in the end they work together because this is the only system anyone
>> > knows or thinks can be made to work. Michael Bloomberg, as Mayor of New
>> > York, commissioned a report which declared that excessive regulation in
>> > the US was threatening the future of the financial sector in New York.
>> >
>> > The financial crash of 2008 destroyed the credibility of the financial
>> > growth model put in place after the last great capitalist crisis in the
>> > 1970s. It has also, as Harvey notes, put a question-mark over the
>> > continuance of US hegemony, because of the shift in the balance of the
>> > global economy towards the rising powers of India and China.
>> >
>> > He thinks that the accumulated rigidities over the last cycle have
>> > become so great that only a very fundamental restructuring can restore
>> > the basis for renewed economic growth. But the pressure for an early
>> > return to business as usual are very great, threatening an early return
>> > of credit and debt as the only way to fuel the economy, and the eruption
>> > of another crisis in a few years.
>> >
>> > Harvey argues that each major capitalist crisis has been worse than the
>> > last one, and more difficult to surmount. He accepts that capitalism,
>> > with all its resilience and inventiveness, is quite capable of
>> > overcoming this crisis too; but he is sceptical, and believes that this
>> > is the moment that a revived anti-capitalist movement can seize the
>> > opportunity to put forward a realistic alternative to capitalism as a
>> > way of organising the economy.
>> >
>> > [Yes, it is evident that each successive cycle is more extreme than the
>> > last. The financial system based on interest-bearing debt is shaking
>> > itself apart. ____
>> >
>> > It seems odd that he attributes “resilience and inventiveness”
>> > to**capitalism. These are human qualities that might thrive in a variety
>> > of circumstances. The question is how, specifically, to support them.
>> ]____
>> >
>> > This is perhaps where the argument is least convincing. The
>> > anti-capitalist left is fragmented and not particularly numerous.
>> > Radical political responses during previous capitalist crises have often
>> > favoured the right. The rise of China and India, both of which have
>> > continued to grow through the recession, suggests that the fundamental
>> > shift in the balance of the global economy is only just beginning, and
>> > if it continues is likely to provide huge potential for growth and
>> > absorption of surplus, provided certain political conditions are met.
>> >
>> > This will not be easy but is certainly possible. Marx thought that no
>> > social order ever perishes before all the productive forces for which
>> > there is room in it have developed. On the evidence Harvey himself
>> > provides, capitalism still has a long way to go before that is the case,
>> > and no gravediggers are in sight.
>> >
>> > [What are the physical limits to the application of those “productive
>> > forces?” It is evident that the masses of India and China cannot
>> > possibly achieve the levels of consumption and way of living that have
>> > prevailed in the West. The emphasis must shift from capital accumulation
>> > and increasing consumption to more equitable distribution and better
>> > quality of life for all.]____
>> >
>> > But this book is a welcome addition to the literature on the crisis. It
>> > provides a lucid and penetrating account of how the power of capital
>> > shapes our world, and sets out the case for a new radicalism and a
>> > vision of alternatives. What we need, he argues, is not just a new world
>> > but a new communism, following the failure of the old - although he does
>> > accept ruefully that using "communist" as a political label may not
>> > bring instant success in the United States.
>> >
>> > [I guess we will need to read the book to see what Harvey has to propose
>> > in making the “case for a new radicalism and a vision of
>> alternatives.”]____
>> >
>> > /Andrew Gamble is Professor of Politics at the University of Cambridge
>> > and author of 'The Spectre at the Feast' (Palgrave Macmillan)/
>> >
>> > [Annotated comments by Thomas H. Greco, Jr.]
>> >
>> > Thomas H. Greco, Jr.
>> > thg at mindspring.com  <mailto:thg at mindspring.com>
>> > Mobile phone (USA):520-820-0575  <tel:520-820-0575>
>> > Beyond Money:http://beyondmoney.net
>> > Tom's News and Views:http://tomazgreco.wordpress.com
>> > Archive Website:http://www.Reinventingmoney.com
>> > Photo gallery:http://picasaweb.google.com/tomazhg
>> > Skype/Twitter name: tomazgreco
>> > My latest book,"The End of Money and the Future of Civilization"  can
>> be ordered from Chelsea Green Publishing, Amazon.com, or your local
>> bookshop.
>> >
>> >
>> > On 11/22/2011 11:37 PM, rajni bakshi wrote:
>> >> Dear Tom,
>> >> I stumbled upon this because of the stuff at the beginning -- that
>> >> Jairus Banaji has been given
>> >> an important book prize in UK. Jairus is a friend and a very respected
>> >> marxist scholar.
>> >>
>> >> The speech by last year's winner seems important.....he talks about
>> >>  capital and money.
>> >>
>> http://www.youtube.com/watch?gl=IN&feature=player_embedded&v=QbOUCLYZVBU
>> >> <
>> http://www.youtube.com/watch?gl=IN&feature=player_embedded&v=QbOUCLYZVBU>
>> >> And a link to an article by David Harvey
>> >>
>> http://www.independent.co.uk/arts-entertainment/books/reviews/the-enigma-of-capital-and-the-crises-of-capitalism-by-david-harvey-1958010.html
>> >>
>> >>
>> >> Regards,
>> >> Rajni
>> >>
>> >>
>> >>
>> >
>> >
>> >
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-- 

Sincerely yours,

     Apostolis Xekoukoulotakis
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