Capitalism Is Killing Us

CJ Polychroniou at Truthout:

The evidence suggests that capitalism has become wholly predatory and has given up all pretense of being "socially responsible."

Are all of the socioeconomic issues confronting Europe and the United States - recession or stagnant growth, skyrocketing unemployment, lowered prospects for new job creation, a demand shortage, a widening gap between the haves and have-nots, social malaise - merely consequences of the financial crisis of 2007-08?

A strong case can be made that what we have been witnessing since then is not simply a severe financial crisis centered in the developed world but the fact that today's capitalism is simply incapable of functioning in an economic way conducive to maintaining sustainable and balanced growth.

The so-called "financialization" of the economy, so prone to financial crises and meltdowns as the late Hyman Minsky has shown, cannot be understood independent of the production processes or developments in the real economy. Advanced capitalism had been facing severe structural stresses, strains and deformations - including overproduction, trade deficits, lack of job growth and elevated public and private debt levels - for quite a few decades prior to the eruption of the financial crisis of 2007-08.

Indeed, the "financialization" wave - which many have labeled "casino capitalism" or "stock market capitalism" but which amounts essentially to the deregulation of giant financial entities capable of shaping and controlling the fate of national economies - began as a result of the structural problems associated with the postwar regime of capital accumulation, whose collapse in the mid-1970s threatened the growing expansion of capitalism. Thus, "financialization" does not spring out of the blue but emerges as an alternative model to the decay of the postwar regime of accumulation.

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In the age of "financialization," and particularly in the austerity-driven period following the financial crisis of 2007-08, the drive to maximize profit takes the form of absolute wage suppression and other means of exploitation, including the socialization of private losses, forcing the transfer of public assets to the private sector and creating debt peonage.

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In the United States, for instance, as throughout the advanced capitalist world, the impact of finance on growth has been negative as investment in the real economy has fallen significantly, and wages have remained stagnant since the late 1970s. The outcome has been the rise of a new Gilded Age, with renewed claims about the superiority of Darwinian capitalism. At the same time, the poor and working-class populations have come to be seen throughout the advanced capitalist world as a sort of nuisance in the galaxy the rich occupy, with attacks being launched by the rich on their wages and working conditions and the media often carrying out derogatory campaigns against working-class identity.

As for the increase in public deficits and government debt accumulation, these developments have been largely the result of insidious tax policies favoring the rich and corporate assets, which are related to the dominance of finance capital in contemporary capitalist society. Even in today's economically troubled southern Mediterranean nations (Greece, Portugal and Spain), which have been demonized by their northern eurozone "partners" and the international media and are allegedly paying the price of their "profligacy," so-called socialist governments pursued regressive rather than progressive social policies methodically over the past three decades.

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In sum, actually existing capitalism has given up any pretext of being a "socially responsible" socioeconomic system and caters almost solely to the needs and interests of the rich and powerful by enforcing policies that are detrimental to the rest of society. Actually existing capitalism is a system that favors passionately and defends ruthlessly the interests of the 1% over those of the rest of society. This explains why the rich, big corporations and big banks have been doing so well at a time when the ranks of the unemployed keep growing and a sizable percentage of the working population struggles to merely survive. This is not then so much a capitalist crisis as an orchestrated putsch on the part of the most powerful faction of capital attempting to roll back the course of history to the detriment of the working populations.

In this context, the economic and social crisis facing advanced capitalist societies today is manufactured by the pursuit of a ruthless class struggle by the economic elites and the national governments they control against labor for the purpose of transferring wealth from the poor and the working class to the rich, making the rich even richer and the poor poorer.

How to halt the further deterioration in the standard of living of the working people and stop the ongoing onslaught on the social state under actually existing capitalism unmistakably represents one of the biggest challenges facing progressives and the labor movement today throughout the advanced capitalist world.