Global Capitalism

There are those who relentlessly believe that globalized capitalism will be our way into the future, and that life has become tremendously better through capitalism, and that if we unleash global capital we will all benefit from this. There is no question that life expectancy has been rising everywhere, and this has been the result of capital expanding to many non-Western nations, especially India, China and Brazil. But there are unmet needs to which capitalism proves unable to respond to. Globalism has not merely meant an expansion of economic opportunities. It has meant that the few people, who control the means of production and labor, the professional managerial class (an Atlantic article called it the new global elite) has the workforce of the whole world available at their feet. Western countries especially Americans have been inclined to yield to these seemingly insurmountable economic prerogatives of this managerial elite by governments that lift regulations on job outsourcing and reduce corporate and marginal income taxes in the hope that the job outsourcing may find its end, that the American worker should receive wage reductions by competing with Chinese workers.

It is a boon and a tremendous blessing for the major multinational corporations, and after the economy has been bled empty and even more cash has been added onto their balance sheets, while high unemployment and private debts are plaguing average working class people. This results in more radicalized politics, pointing to the militiamen and the tea party rhetoric in the US. (I refer to David Sirota’s “Uprising”, in which he is attempting to capture the populist mood of those who do not stand to gain from the gains of economic growth that have largely gone to the super-rich.) The corporate leaders (or shall I say corporations, when this terminology is a means of hiding behind ruthless decisions to slash employee payroll and to hire more contractors without benefits) become aware of the declining market, and welcomes the move overseas, where a growing Chinese or Indian middle class will be the next people on the capitalist’s list.

In the mean time we can dream up an alternative global model of an economic system. There should be a fairly clear consensus about the shattering global hegemony of liberal democracy (if it ever existed). Global capitalism is neither liberal, because it enlists more people into wage-labor conditions, which is scarcely the same as freedom, nor democratic, because the supremacy of capital can only accrue to the benefit of those who happen to control capital and the means of production. The alternative economic model in a realistic Keynesian scenario (realistic because it had been tried before) would be the internationalization of labor, the greater cooperation among workers across the world. This is the consequence of the vertical integration of production methods and the internationalization of the capitalist class. To put it in bluntly labor terms, if the business/managerial class expands collective bargaining, the workers have to do likewise. I still believe that one of the greatest failings of the national labor movements was that they have not been able to organize internationally. The much smaller capitalist class has it infinitely easier to band together and find ways for cooperation across borders, since profits are the center motive. For the larger group of working class people nationalism, nativism, fear and distraction have been the guiding motives of economic action. Consumerism and an improvement in living standards are completely sufficient goals, and I am wondering whether it takes hunger catastrophes to spark increased activism.

The internal contradiction of capital accumulation can not be resolved through the best-intentioned and best-enforced Keynesianism, which would return us to the debate of Marx, and the overcoming of economic oppression and the production according to human needs. Or as Marx himself writes, “From each according to his ability, to each according to his needs!”

I am hereby quoting a book passage commenting and concluding on the nature of the most recent wave of capitalism, that is gloabl capitalism. Paul Bowles, “Capitalism”, 2007, pp186-187

“In judging global capitalism , I am reminded of Keynes’ 1931 review of a book by Hayek. In his review, Keynes wrote that Hayek’s ideas provided “an extraordinary example of how, starting with a simple mistake, a remorseless logician can end up in Bedlam”.

This strikes me as an apt description of the characterization of capitalism as “natural and free”. markets in health which dictate that individuals who can pay will live and those who cannot will die are not “natural”. Markets in food which deliver gastronomic delights to the rich and undernourishment for the poor are not “natural”. “Human nature” does nt dictate that these outcomes must prevail and human societies do not have to be organized in this way or human institutions work in this way. Markets are indeed “blind”, as Hayek argued, but not in the way he suggested; rather they are blind to poverty, to environmental destruction and to inequality. Individuals who must give control of their labour to others are not “free”. Individuals in the richer countries whose well-being depends on not losing their jobs, or on a family member not losing theirs, are not “free”. Individuals in poorer countries whose well-being depends upon the price of their labour, or upon the prices of what they produce not collapsing, or upon not being evicted from their land, are not “free”. We can- and should- all be freer, and more human, than this.

Starting from the simple mistake that private property, the pursuit of profits and markets are the route to human freedom, the proponents of capitalism logically and remorselessly deduce that the relentless pursuit of profits, the ever greater accumulation of private property and the ever-expanding scope of the market- phenomena which characterize the contemporary phase of global capitalism- must enhance our freedom. They are more likely to lead us to Bedlam.”

This entry was posted in Economics, History, News and politics, Social Sciences. Bookmark the permalink.

One Response to Global Capitalism

  1. Pingback: Unregulated Capitalism and the destruction of the Middle Class… and what we can do about it. « Under The LobsterScope

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