STWR - Share The World's Resources

The development of globalised capitalism has led to financial, food and climate crises that threaten the regions of the world in different ways. This report compiles views raised at the 'Conference on Alternatives and Transformation Paths to Overcome the Regime of Crisis-Capitalism', by the Transnational Institute et al.

Link to full report: The World Crisis - and Beyond

5th November 2009 

Preface to the Report

28th October 2009 - Rosa Luxemburg Foundation in cooperation with World Forum for Alternatives and the Transational Institute

Neoliberal financial-market capitalism has dragged the world into a crisis which threatens human civilisation as such. It is characterised by an extreme form of the combination of, on the one hand, the expansion of production, transport and life-style, with, on the other, the destruction of its own foundations, and suffers from a crisis of social reproduction, societal integration, democratic identification and security. Climate destruction, resource wars, terror, the transformation of democracy into oligarchy, class divides, a new racism and fundamentalism, etc. are unavoidable. It therefore leads to a crisis of civilisation, and produces ever stronger elements of barbarism and authoritarian power, which can only be contained at ever greater expense. (BRIE)

In the contemporary global situation, the principal focus of the working masses in the world is on the ongoing and the unabated economic crises that lay centred in the US enveloping the world, as the brunt of this phenomenon is being borne by them. Bailouts and stimulus packages have been doled out by the governments of the imperialist triad – US, Europe and Japan in a bid to pull out their economies from the quagmire of this crisis variously named as – Financial Meltdown, Financial Crisis, Recession and Economic Downturn. (MURTHY PK) The current crisis marks an important historical moment, as it marks the end of a capitalist phase that has been unprecedented, from its very beginning with the industrial revolution of the 19th century and its undisputed victory over what had been its unfortunate “alter ego” for half a century: the rapidly dismissed experiment of Soviet socialism. This crisis is both fortunate and pertinent, as it is a result of capitalism itself; and that is why we must seek the reasons for the catastrophe – and why not also for its «passing» – in capitalism. (EL KENZ)

What we have unfolding before us is not a crisis of the neoliberal variant of capitalism but the crisis of capitalism. (BELLO) The financial crisis is only the visible tip of the structural crisis of the globalized capitalism today. (HABASHI) The leading groups, both at local and international level, run today – like a closed system – a “disembedded” and globalised economy, which has become “irresponsible” of the consequences and effects that it generates and that affect both man and nature. Their failure is amplified, and will be even more so in the future, by the use of new – and largely speculative – methods of obtaining profit. On the contrary, this global, brutal and profound crisis has demonstrated that the “disembedded” capitalist economy has reached its economic, political, social and ethical limits. It poses a threat to our societies, as well as to nature; it endangers both the present and the future of our world. (EL KENZ)

Contemporary capitalism is first and foremost a capitalism of ‘oligopoles’ in the full sense of the term (which so far capitalism was only in part). The ‘oligopoles’ alone command the production of the economic system in its entirety. They are ‘financialised’ in the sense that they alone have access to capital markets. This financialisation grants monetary and financial market – their market, on which they compete with each other – the status of dominant market, which in turn fashions and commands the labour and commodity exchange markets. (AMIN)

Under capitalism, crises are parts and parcels of the accumulation process. Capital needs to deconstruct and reconstruct patterns of exploitation to offset class struggles and to face inter-capitalist and inter-imperialist competition. (BEAUDET) The financial crisis should depreciate a logically quite gigantic amount of the parasitic fictitious capital to get to restart a new accumulation cycle of the capital. However, from today on, the contradictions of the capitalist world system will be so strong that such depreciation would risk pushing it toward a downfall, with economic, social and political consequences that cannot be predicted by experts.

As usual, when there is a capitalist crisis, the bourgeoisie is forced to deny a depreciation of accumulated capital by a systemic necessity - trying not to record large losses. In this way, the capitalist dominant classes become stronger than they were before - even if a part of them turns to be middle classes. In every reorganisation of capital domination during the 20th century, the improvement of the macro-economic policies allowed the system to create institutions and more efficient instruments in order to attenuate the devastating effects of its own crises, rather than to avoid the exacerbation of its internal contradictions and a convergence toward the stagnation, or even depression. (NAKATANI)

What is however specific to the present crisis is not only its global dimension but the fact that it is a combination of various crises, which are all the fruit of capitalist logic – and that is what needs to be explained. The crisis is not only a financial one. It is much more than that. It is also an economic crisis, which could lead to a world depression, with all the accompanying social ramifications. In addition moreover, we are also experiencing a food crisis, an energy crisis and a climate crisis. So we are facing today four main crises: financial and food crisis are conjunctural, but are also potentially structural. Energy and ecological crisis, on the other hand, are fully structural. (HOUTART)

The global crisis is a crisis of capitalist globalisation in its neoliberal phase. It is a structural crisis: economic and social; ecological, geopolitical; political and ideological. The current sequence of a financial, monetary, real estate, food, and economic crisis shows many facets of it. All these aspects play a decisive role in the confrontation between social and political movements and the ruling powers. (MASSIAH) That the crisis is essentially the crisis of capitalism as a system is an uncontestable fact. It is not merely a financial crisis – it is an economic crisis, a food crisis, a natural resources crisis, an ecological and environment crisis, a social crisis, a cultural crisis thus sowing the hollowness of the much acclaimed capitalist system. (MURTHY PK)

Because of the interaction and entanglement of severe crises this appears to be a structural or organic crisis. The reserves of still dominant neoliberalism as the organizing ideology in the transition to a transnational mode of production based on information technology are exhausted – neither a new accumulation stimulus nor a new consensus in society can be expected from it. Its institutions will continue to have effects (similarly to the end of Fordism), their position is now only “ruling”, still dominant, but not “leading“ (Gramsci) anymore. We are facing the most far-reaching financial and economic crisis since the 1930s, closely linked to food and energy crises, and to the destruction of employment, which means further aggravating of the precarisation of working and living conditions that thrusts large parts of society into soaring insecurity and increasingly leads to revolt at the external and internal peripheries among thosemost affected.

Protest and resistance is forming at all levels, still fragmented and without clear direction, but periodically rising. (CANDEIAS) But first of all there is a crisis of natural resources and the environment. Growth without limit on a world scale is not possible. In this way, capitalism is reaching its limits. By far the most dangerous crisis is the ecological crisis of climate change and loss of biodiversity. Why should we fear it most? Because with finance, food, or even social inequality, if we make enormous political efforts, it is possible to go back and start over, we can correct our mistakes and prevent these crises from recurring. Not so with the environment – once runaway global warming has taken hold, the game is over. We are on the threshold of such an extreme event, perhaps we are already past it. But since we don’t know, we must act as if we still had time and make an all-out effort, right now, to reduce the burden we place on our unfortunate planet. (GEORGE)

The principle of endless accumulation that defines capitalism is synonymous with exponential growth and the latter, like cancer, leads to death.1 The current crisis is therefore neither a financial crisis nor the sum of multiple systemic crises but the crisis of imperialist late capitalism of generalized and financialized ‘oligopoles’. This crisis is also at the same time a crisis of US hegemony. Taken together, the following phenomena are inextricably linked to one another: the capitalism of ‘oligopoles’, the political power of oligarchies, barbarous globalisation, financialisation, US leadership, the militarisation of globalisation in the service of ‘oligopoles’, the decline of democracy, the plundering of the planet’s resources, and the abandoning of development for the South. The contemporary world is governed by oligarchies whose management of the system is in crisis. (AMIN)

The world’s leaders and their advisors, particularly economists, largely remain in a state of denial. First they denied that the crisis would go beyond the housing sector; then they denied that it could spread beyond the borders of the United States; then, as the crisis did rapidly spread to the rest of the developed world and to the global South as well, they pretended that finance capitalism could somehow be »decoupled« from the real economy. Then they pretended that throwing more and more money at the banks will somehow jump start the world economy. They act as if modest measures regulating capitalism around the edges will suffice and that the crisis will quietly go away. (GEORGE)

Uncertainty prevails regarding the duration of the current crisis and future prospects. Let us remember the last structural crisis, its official beginning in 1929, the Great Depression in 1930, the New Deal in 1933, the new political landscape in 1945, following a world war. Several scenarios are possible. One is that of a conservative nature, a war neoliberalism. The second is that of a fundamental reform of capitalism by choosing a neo-Keynesian and ecological approach or a “Green New Deal”. The third is set in the context of the historical question of going beyond capitalism. (MASSIAH) One important question, of course, is how decisive and definitive the break with neoliberalism will be. Other questions, however, go to the heart of capitalism itself.

Will government ownership, intervention, and control be exercised simply to stabilize capitalism, after which control will be given back to the corporate elites? Are we going to see a second round of Keynesian capitalism, where the state and corporate elites along with labour work out a partnership based on industrial policy, growth, and high wages – though with a green dimension this time around? Or will we witness the beginnings of fundamental shifts in the ownership and control of the economy in a more popular direction? There are limits to reform in the system of global capitalism, but at no other time in the last half century have those limits seemed more fluid. (BELLO)

The depth of the crisis and the conflict over ways to overcome it will determine the next years. It marks a historical break in capitalist development. Therefore, within the framework of revolutionary political realism, it concerns the whole societal organisation, the common disposition about the immediate conditions of life. This orientation towards the whole of the social structure is more than just a long term objective, it is an essential element to prevent the restriction or the relapse into corporatist (that is group interests in a narrow sense) or towards single reforms which regularly intensifies subalternity, what is always the case when struggles are not seen as hegemonic conflicts over the whole mode of social organisation. Then what happens is the integration of partial interests into the ruling power bloc by compromise. This is also difficult to avoid. However, conditions for at least partial steps to the left are favourable in these times, since the active consensus is eroded and splits between groups in the ruling power bloc impede or reduce their capacity to act, and the search for new social coalitions has started. – An opportunity and at the same time an especially difficult and dangerous moment for left forces. (CANDEIAS)

Is the reinstatement of the capitalism of financialised and globalised ‘oligopoles’ possible? Today the powers that be, those who did not foresee anything, are busy restoring the same system. Their possible success, as that of the conservatives in the 1920s – which Keynes had denounced without much of an echo at the time – will only exacerbate the scope of the contradictions which are the root cause of the 2008 financial collapse. The oligarchies of the North seek to remain in power once the crisis is over. They do not feel threatened. (AMIN)

The power for example of the US empire to impose its economic model and its military control around the world depends on the lack of consciousness and independent political organization among the victims of the same system within the belly of the beast. As long as this growing class of poor and excluded of all races in the US remain unorganized and isolated from the global movement for “Another World” – the poor of our country will continue being used as cannon fodder and as an unconscious social, political and material base for the empire and its twin heads – neoliberalism and militarization. (COX/HONKALA)

By contrast, the fragility of the power held by the autocracies of the South is clearlyvisible. The model of globalisation that is currently in place is therefore vulnerable. Will it be questioned by the revolt in the South, as was the case in the previous century? Probably so, but that would be cause for sadness. For humanity will only commit itself on the road to socialism – the only humane alternative to chaos – once the powers of the oligarchies, their allies and their servants, will have been defeated both in the countries of the North and those in the South. (AMIN)

Ultimately, an analysis of the overall situation suggests that we are facing a real crisis of civilisation. It is impossible to consider solutions without a vision and an analysis of the whole, without a holistic approach. A simple regulation of the economic system would not be particularly significant if it were simply to involve beginning again anew, from where one had left off before the crisis. What is the use, indeed, of developing and regulating a financial system to finance a productive system which is as destructive of ecological and social realities as the one we now have? How can a solution to this crisis move us beyond the parameters of capitalism? (HOUTART)

The urge for transformation poses the question, whether it will be more society-driven or more state-driven, whether they display a local, national or global reach and whether they have a short-term, medium or long term impact. In the real world the struggle for alternatives takes place within civil society as well as in the political arena of the state, sometimes within, sometimes against, and very often without the state, i.e. state subsidies. (ALTVATER)

Building throughout the world the widest social and political alliances is indispensable to avoid what could be another onslaught against the peoples like we have seen in the past century. (BEAUDET) The challenge is to define a new emancipatory project. There are already social relations foreshadowing this development, the same way capitalist social relations emerged in feudal societies. The new world, born from the old world, is beginning to take shape today, and it will experience difficulties. It is starting out from contradictions already experienced and it will create new contradictions. A new, collective emancipatory project is on the agenda. Capitalism is not eternal; the question of going beyond it is now topical. And we must start from now on to build another possible world. (MASSIAH)

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