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Anarchist Communist Statement On The Global Economic Crisis And G20 Meeting
international | economy | feature Monday November 17, 2008 03:36 by Anarkismo
International anarchist communist statement on the global economic crisis and G20 meeting, endorsed by Alternative Libertaire (France), Federazione dei Comunisti Anarchici (Italy), Melbourne Anarchist Communist Group (Australia), Zabalaza Anarchist Communist Front (South Africa), Federação Anarquista do Rio de Janeiro (Brazil), Common Cause (Ontario, Canada), Unión Socialista Libertaria (Peru), Union Communiste Libertaire (Quebec, Canada), Liberty & Solidarity (UK), Asociación Obrera de Canarias (Africa), Anarchistische Föderation Berlin (Germany) and Reading Grassroots Action (UK). [Français] [Castellano] [Italiano] [Ελληνικά] [Polska] [Deutsch] [中文] [عَرَبيْ ] [Nederlands] [Português]
Anarchist Communist Statement On The Global Economic Crisis And G20 Meeting
[Français] [Castellano] [Italiano] [Ελληνικά] [Polska] [Deutsch] [中文] [عَرَبيْ ] [Nederlands] [Português]
2.Any solution to the crisis prepared by capitalists and governments will remain a solution within capitalism. It will not be a solution for the popular classes. Indeed, as in every crisis, the workers and the poor are paying – while financial capital is being bailed out with huge sums. This is likely to continue. No change within capitalism can resolve the problems of the popular classes; still less can such a solution be expected from individual politicians, such as Barack Obama. The most such politicians can do is play a part in offering the capitalists a way out, and perhaps in throwing the working class some crumbs.
3.The bank bailouts show not only whose interests the state serves, but the hollowness of capitalist commitment to free markets. Throughout history, capitalists have stood for markets when it suits them, and state regulation and subsidies when they need it. Capitalism could never have existed without state support.
4.In the US, the UK and elsewhere, the bailouts have taken the form of nationalisation of troubled financial institutions – with the full support of capital. This shows that capitalists have no fundamental problem with state ownership, and that nationalisation has nothing to do with socialism. It can also be a method of screwing the working class. We ourselves, not the state, need to take control of the economy.
5.Owing to the globalisation of capital under neo-liberalism, the ruling class recognises that the solution must be global. The G20 is meeting from 15 November to discuss the crisis. This is significant. The rulers of the US, Europe and Japan are coming to realise that they cannot handle the crisis on their own; that they need, not only one another, but other powers, notably China (which is emerging as a top industrial producer, and is on its way to becoming the world's third-biggest economy). India, Brazil and other "emerging" economies will have seats at the table. This may mark a recognition – under discussion for some years – that the G8 alone are no longer the world's economic decision makers. It is likely to signal a shift in the running of the global economic system.
6.We place no hopes in the inclusion of new capitalist powers. China's rulers may claim to be socialist; others, such as Lula of Brazil and Motlanthe of South Africa, may present themselves at times as champions of the poor. But in fact, all are defenders of capitalism, exploiters and oppressors of the people of their own countries, and, increasingly, imperialist or sub-imperialist exploiters of the people of other countries.
7.If the crisis is to lead to anything other than complete defeat for the global popular classes, poverty, exploitation and war, the popular classes must mobilise. We must demand bailouts, not for the capitalists, but for us. We anarchist communists will fight for those who got homes on subprime mortgages to be bailed out and keep their homes. We will continue to engage in and support struggles for jobs with better wages and shorter hours, housing, services, health services, welfare and education, protection of the environment. We fight for an end to imperialist wars and to repression of our class and its struggles.
8.We present these demands in response to the G20 meeting, and will continue to present them in the future. Through such demands, and through direct action to bring them about, we will work towards building a global movement of the popular classes that can put an end to capitalism, the state and the crises they create.
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This is a good general statement. It provides a revolutionary perspective along with a set of militant, nonsectarian, reform demands. However, I have a criticism of the brief statement on the background of the economic crisis.
It says, " 'Overproduction,' speculation and subsequent collapse are inherent to the system. (As Alexander Berkman and others have pointed out, what capitalist economists call overproduction is actually underconsumption: capitalism prevents large numbers of people from fulfilling their needs, and so undermines its own markets.)"
The theory of "underconsumption" states that the problem with capitalism is that the workers cannot buy back the products they produce, thus causing a crisis. However, the workers can NEVER buy back the whole of the products they produce--including during periods of prosperity. If underconsumption were true, then capitalism could not function, ever.
The whole point of capitalist production is the production of surplus value (profit), which can be used for capital accumulation. That is, aside from the working class' consumption, there are also goods produced for the capitalist class' consumption (luxuries) as well as for the maintenance and growth of capitalist industry (means of production). All these must be produced.
But capitalism gets in its own way. In this epoch, it has a problem essentially of *underproduction.* Not that its technology could not make things, but it is unable to produce enough profitable goods to maintain accumulation. If it could produce enough profitable goods, then its industry would buy means of production, and enterprises would HIRE more workers to make things, who would be able to buy more consumers' goods. And so on, through the business cycle. There would be no underconsumption nor overproduction.
Instead they have kept the system going through the "production" of "fictiicious capital", both sheer paper representation of (nonexistent wealth) and the capitalization of goods which are unpaid for ("primitive accumulation"), including robbing the environment..
I am relying on theoretical concepts elaborated mainly by libertarian Marxists and other dissident Marxists, whose politics overlap with anarchist-communism.
I agree with Wayne on the point he makes on the "under consumption" line. Indeed, consumption has even been stimulated through articificial means (the subprime credits and loans that the statement rightly points out) to a point where the lives standards of most Western societies, and also of the middle and upper classes of the "emerging powers", is just not sustainable for the six billions or so humans living on planet Earth.
But the capacity to stimulate consumption of largely unnecessary produce under capitalism has a limit and nowadays we see the way some big firms have problems to allocate markets for most of their products (this is one of the reasons of the emphasis of the big powers in Free Trade Agreements). As Kropotkin stated over a century ago, capitalism not only creates want, but as well, creates artifical needs. Not only it exploits, but it distorts the economy, wasting human labour and resources in largely useless production.
Overproduction is a problem and the current industrial model is unsustainable. Apart from this, great statement, brief and to the point... spot on!
Of course, "over-production" implies "under consumption" and vice versa.
What I think should be stressed is that we have relative over-investment in certain sections of the economy (a bubble) combined with massive rises in inequality, and so a decline in general aggregate demand which has been masked by increasing levels of debt.
This has made the economy fragile, with the housing bubble imploding resulting in a general crisis.
Credit Crunch: The return of depression?
What an insane way to run an economy...
Question: Are other federations, such as NEFAC, invited to sign this statement?
Does the WSM have an opinion on the statement? Was it invited to sign and did it decide not to?
to Wayne : every anarchist-communist organization is welcome to sign the statement. I think Nefac should sign, as well as WSM. WSM is currently thinking about it, I guess. Nefac's Anarkismo delegate didn't say nothing during the discussion on the Anarkismo editorial forum, so Nefac may not even be aware of this statement. That's why it would be good if every organization had an ACTIVE delegate on Anarkismo.
Let us (Anarkismo delegates) know ASAP if your organizations would like to sign the statement.
capitalism found markets outside of their captive pool of labor, the last major market to be incorporated within their pool was China, opened up by Nixon in early 70s, capitalism functioned until then.
Since then, as Wayne correctly observed, capitalism has not functioned. The only way capitalists could sell their surplus shit was to give credit, lots of credit, to labor in order to afford it.
We are now seeing the fruits of that move. The capitalists want their profits but surprise surprise those monies never existed, so now the central banks must print up some more just to give the capitalists something to stick in their pockets.
BTW, both the G20 and the G8 are window dressing, fodder for the media, the pitchmen for the next con.
It is the G7 that makes the decisions, sets the agendas, determines the policies. Somehow, I thought that the difference between the groups would be understood on this site.
Yes, all very good discussion! One more point...
Back in the 90's, the new left used to say that the economy isn't about production, distribution and consumption anymore. In the new technological economy, so they said, it's the immaterial economy which is the source of surplus and only for the investing class (this is my understanding, someone else may clarify)...
By "immaterial economy", they meant speculative investments, currency trading, futures - all the financial rigamaroll which now has turned out to be total junk - short selling, debt-credit swaps by hedge funds, mortgage-backed securities, collateralized debt obligations, blah, blah, blah in which most peoples retirements and 401K's were invested...at any rate, its all crashed now...
It was an illusionary economy, and the u.s. has downsized and outsourced most of its industry (I'm from rustbelt Michigan), which were at least fairly good-paying jobs. But I always say, wanting new jobs is also asking for more bosses...some Argentinian factories have become worker-managed after their crisis there in 2000...
So I want to ask, what do you love enough to want to make, and be a part of its management...Its unlikely you need a boss, maybe just some good partners...let the auto industry die, the workers have been dead for a long time - representation just doesn't work, only an Autonomous Union like an IWW model is feasible anymore, without just making workers into drones...
I am of the understanding so far, (correct me if I'm wrong) that it is not just "over production /underconsumption or under production that is creating the current crisis. Enough wealth is being produced to satisfy capitlaist profits and their excessive consumption as well as labours' consumption needs. Part of the problem is that capitalists since the late 1970's have not been reinvesting excess wealth back into their businesses, which theororetically would stimulate economic growth, but instead they have been hording it.
The goal of capitalism is growth due to accumulation of productive capital. If the capitalists just "horde" their wealth instead of reinvesting it productively, the question is WHY would they do this? The answer is that they cannot find enough productive investments. because, contrary to bopaul, "enough wealth is [NOT] being produced to satisfy capitalist profits," (Due to the long-term falling rate of profit.)
Instead, as jones points out, the post-WWII economy has been what various autonomous Marxists have called an "immaterial economy," dominated by "speculative investments, curency trading,futures," etc. These autonomous Marxists (degenerated decendents of libertarian Marxism) seemed to regard this as progressive, leading to an abandonment of revolutionary working class politics in favor of a new sort of reformism ("exodus"), similar to reformist anarchism. Instead, these facts point to the extreme weakness of capitalism in its epoch of decay, its vulnerablity to a humongous crisis, and the need for proletarian-led revolution.
Thanks Wayne for further clarification. I am finding this discussion quite thought provoking as I am only just begining to try to develop a better analysis of how capitalism functions...beyond the obvious in your face inequalities.
I understand that the goal of capitalism is to produce surplus value and that some of that surplus value gets reinvested into the production process... for machine maintainance, R&D, expansion and hiring more labour etc. My simple understanding (at this time of my development) is that the idea behind neoliberal economics, which really kicked into gear in the late 1970's, is that tax cuts would create an environment that would encourage capitalists to invest and reinvest their new profits into businesses thereby creating more jobs and so on, the cycle continues. Only instead of reinvesting in business, the capitalists have been more prone to increase their personal share while not increasing in reinvestments in productive capital. Hording is perhaps a bad choice of words...they haven't been as interested in investing in real productive capital as neoliberal theory predicted. Instead they have been drawn to invest in the fake world of financial capital with their newly won increase in profit margins (achieved by neoliberal economic policies).
I could be way off here with my theory. I don't mind being told so either. But I would like to understand more of what Wayne's theories are. I found Jones' efforts to explain things more understandable for my underdeveloped sense of economics.
1] The bourgeoisie did not abolish class antagonism in modern society. The new capitalist class in power only substituted new classes, new oppressive conditions and new forms of struggle. One of the most important forms of struggles is the daily class struggle in production directed by capital which extracts surplus value from labor. This constitutes a fundamental and essential element of capital, and by extension of the capitalist class itself.
Capital, in bourgeois economy, is the valorization of a sum of specific values. Not all values are capital. That depends on their utilization. A value in a piggy bank or solely used for consummation is not capital. Values must be invested to become capital and to draw more surplus value. The capitalist extraction of surplus value (embodied in the capitalist rate of profit and in the interest rate) is the driving fore behind that general tendency to produce more, to draw even more profit. The tendency of producing more is a never-ending process.
This process may appear different depending on the mode of investment and economic practice. We can distinguish between different kinds of capital: finance capital (the fusion of banking capital with industrial capital), mercantile capital and industrial capital. The extraction of capitalist surplus value takes different forms in these different kinds of capital: financial interest, trade profit, and industrial profit. The manner in which these are extracted is totally different.
2] To really understand the origin of surplus value at the social level we need to firstly recognize the limitations of the surplus value being extracted thru mercantile transactions and thru financial transactions. In fact, this is one of the fundamental aspects of the crisis facing capitalism/imperialism now. Indeed, in all the cyclical crises facing imperialism since the 1900's, one of the prominent aspects is how surplus value was/is being extracted. Trade and monetary circulation are endemically governed by the rule of exchange between equivalent goods. This applies to any exchange or any contract. Therefore, no new value is being created, meaning no surplus value can be produced, in the sphere of circulation and speculation. The circulation of goods is just a mechanism that helps to realize a product's necessary social value by finding a consumer for that commodity. But, in and of itself, the circulation of merchandise (or commerce) does not produce any new value.
Financial transactions, whether through speculation or lending for profit, also do not generate any new values. Therefore they also cannot create surplus value. These economic activities only participate in the distribution of surplus value between the different holders of capital. We could just figure an orange that we keep squeezing to produce juice and we keep adding more water to it to get more juice. When finance capital became hegemonic, in its relation with other fractions of the bourgeoisie in an imperialist social formation, the tendency to extract surplus value thru speculation and circulation, mostly speculation, became the dominant aspect in the distribution of surplus value within the capitalist class, therefore accentuating the periodical and cyclical crises. We see capital as becoming less and less capable of getting out of its hole because of rising endemic deficits and the surge of fictive assets and their degeneration into so-called "toxic assets". The measures taken to address the latest financial crisis are only directed at the effect of the crisis, not its causes. In reality, this is not really a response to the crisis but a measure that extends the crisis by enacting a transfer of wealth to its perpetrators through governmental intervention in the "free market" while maintaining all the financial mechanisms that are responsible for the crisis in the first place. Indeed, we have been told that the "system" itself is at at stake if "we" (the taxpayers) do not "rescue" this doomed enterprise. It is a shock absorber measure taken to amortize a free fall, not knowing how strong the spring of that shock absorber is.
3] The only economic activity that can create new values, especially socially necessary values, under a capitalist mode of production, is industrial production. But industrial capital has become intertwined and dependent on financial capital through the creation of all sorts of financial instruments, derivatives, futures trades, options, venture capital, and speculative activities on everything from currencies to raw materials.
4] The social process of capitalist exploitation of labor power and the extraction of surplus value are the fundamental elements of the capitalist relations of production. The movement of capital inside a social formation or internationally (globalization) and the movements of goods with all their complexity and contradictions depends on these fundamental relations. They constitute secondary aspects of capitalist relations of productions, although necessary to the reproduction of capitalism. But at the stage of imperialism these secondary and important aspects of capitalism, are increasingly playing a primary role, therefore creating a series of crises that are harder for imperialism to correct and rectify.
5] In the mutually dependent and contradictory capitalist relation between capital and labor, labor has been steadily loosing most of its hard fought gains: most workers have lost their pensions plans, their self-invested pensions, 401k plans, have dwindled in value, the Social Security program is on the verge of bankruptcy, and its payments are woefully inadequate. Workers' healthcare benefits have been systematically reduced and workers are increasingly forced to pay more and more for their own health insurance, massive cutbacks in social spending have been enacted and privatization of social services has been shoved down our throats. All these measures, the flip side of neoliberal agenda inside the US, have one sole common purpose: enabling the capitalist class to reap more profits.
6] We must try to understand the configuration of the capitalist class in the US social formation. One of the ways to understand this configuration is by analyzing the internal class struggle of the capitalist class. It is important that we also identify the dominant form of capital. Is it State monopoly capital? Is it monopoly capital? Or is there a tendency of fusion of these two? The latest measures surely are opening the way for such process. What remains fundamental is the devaluation of financial assets thru different means. This devaluation is, in effect, putting imperialism in a deeper hole that is more difficult to come out off.
China is serving an example for all other big mouth capitalist countries like screwed up US and Europe. People are loosing jobs and unemployment is increasing because of these US based ventures who only care for money and not where the popular class is affording that money from. In the article it is explained (although I already felt about it) that Lula of Brazil and other one from South Africa are just another type of capitalist, who just believe in economic growth of rich and high class. One thing that is not clear is whom are the Indians with. They although not as strong as China and Brazil but still counts in the best emerging countries. The question is whether the kind of economy India supports whether it is Capitalist or Communist. Sooner or later it will be an important part for India to play in the world politics and things gets further screwed up by the fact that China and India worlds two fastest growing economics (although China is far much better and powerful than India) are neighbors to each other. Not two countries with such great influence on World economics, with such fast pacing economy, with such great purchasing power are neighbors to each other. So if India choose to go another way and China believes in making its own path which is for Common Good. so the question is what kind of economy India is?