The End of Capitalism…?

Obviously… by virtue of the title… I’m referring to our current economic crisis.  Now, I admit: I have Marxist sentiments.  I even consider myself a Marxist (although I’m a bit wary of it because of the widely misunderstood notions of what that means).  The major reason why I would attribute that to myself is because frankly, I feel that his analysis of capitalism was right.  Contrary to common perceptions of the man, he was a scholar of capitalism.  By deeply understanding its processes, he eventually concluded that capitalism would rationally have to come to an end.  I do not have the time nor place (and I wouldn’t be able to do him justice) to discuss his theories in full.  But I would like to reflect on a lecture I attended.

Robert Brenner, UCLA professor and one of the world’s premiere Marxist historians, gave a lecture at Harvard today.  His research analyzes the current state of the market as a reflection of the exhaustion of capitalistic processes.  Contrary to the popular perceptions of technological advancement and growing “wealth” of the western economy, we have come to a dead end.  We have over-capacitated our manufacturing processes and sacrificed production in the name of profit.  Since the post-war epoch, we have consistently cut costs, which has gradually stifled the return of capital.  By crunching credit and inflating interest, our economy has stood helpless while watching brief economic “booms,” which essentially were momentary returns, undercut our own ability to break from sub-prime assets.

There are five insights a fellow lecturer gave:

First, this is no ordinary recession.  Its effects are saturating every sector of the economy.

Second, there is no exit from this crisis.  Why?  During the Clinton administration, there was a move known as “Global Market Integration”.  Or in other words, allowing neo-liberal economic practices to dictate the market.  Thus by fully integrating the market into a single ideological practice with no balancing alternative, we have undercut our own abilities to be rescued from the crisis.

Third, there is no evidence that there is any control of this crisis.  Newspapers gradually keep indicating that “this is a lot worse than we expected”.  This is obviously not a very academic way of stating a condition, but we must be mindful that it will only get worse.  Sub-prime assets, propelled by short-term lending practices in the housing market, essentially centralized the very health of our economy into the hands of estimated returns.  This helps explain why Wall Street tanked (or is tanking) because of the failure of the housing market.

Fourth, everything (globally speaking) resides on the U.S. nation-state.  We are the biggest borrower and spender of global capital.  This inherently places us at the very center of the global market.  This means… if we tank… so does everyone else.

And lastly, we have to ask ourselves: Can our environment endure what capitalism asks of us in order to move beyond our crisis?

Robert Brenner’s answer, and I agree with him, is no.  Not necessarily that it is impossible… but rather, the costs are not worth it.  “Worth it” relative to what?  Let me explain…

Our current crisis puts our economy, and by virtue us as well, in a mode of survival.  This can easily move us into an economic climate where moves are made at the cost of even more significant portions of the country… or the world for that matter.  By continuing down the road of over-capacity and underproduction, we jeopardize the global economy.  But there can be something else…

We can take this as an opportunity to rethink and critically question the practice of capitalism on the micro-level.  Examining things such as social relations, production as meaningful-rather-than-numbing, and competition as the fundamental motivator of innovation can help us rethink the way economics, business, and production is done.  In other words, we can see the “collapse” of capitalism as liberating.  The issues, then, aren’t necessarily technical… it is also cultural.

A professor from Detroit once told me that when he takes people on a tour of the deteriorating-yet beloved Motown, he says, “This is what the soul of a dying empire looks like.”  However, there is a lesson to be learned from this city if one studies what is happening on the ground.  There are grassroots activists that are modeling a community of new social relations… in the midst of economic depression.  They are practicing what is called: solidarity economics.  Work and production, as well as innovation, for the sake and empowerment of the community.

This leads me to a final thought… perhaps the least thoughtful of this rambling post.  Our current crisis, built upon credit, debt and competitive-but-over-capacitated production, begs me to ponder: What is it about competition that seems so necessary to fuel innovation and production?  This implies that people won’t work hard or innovate because profit is no longer the driving factor.  I realize that this is highly idealistic questioning.  But is competitive profit the sole motivator for innovation and production?  What about advancing the quality of life for all?  What if our economy was structured so that production would be in the name of communal advancement?  Setting aside examples of the Soviet Union and Eastern Europe (which are different subjects in themselves), I believe it has to be tried and tested.

I’m guessing I’ve lost most of you already.  But if you’ve read this far, thank you.  Hopefully, this financial crisis brings some fruitful critical thinking.

A Two-Fold Movement

There was a little man in Peru, a man without any power,
who lives in a barrio with poor people and who wrote a book.
In this book he simply reclaimed the basic Christian truth that
God became human to bring good news to the poor,
new light to the blind, and liberty to the captives.

Ten years later this book and the movement it started
is considered a danger by [the United States of America],
the greatest power on earth.

When I look at this little man, Gustavo,
and think about the tall Ronald Reagan,
I see David standing before Goliath,
again with no more weapon than
a little stone called A Theology of Liberation.

-Henri Nouwen,  ¡Gracias!

Liberation theology, as articulated by Gustavo Gutierrez, is a two-fold movement: the humanizing of God and the humanizing of the other.  It situates God in the person of Jesus.  God thus becomes that very being you can touch, listen to, and ultimately follow.  You can visualize whom he’s with: the poor man with nothing to eat, the leper with no community, and the woman who is about to be stoned.  You can further see the masses that have gathered to hear him speak . . . those poor Mediterranean peasants listening intently to what he had to say about their lives.

Blessed are the poor, for theirs is the kingdom.

Blessed are the peacemakers, for they will be called children of God.

Love your enemies.

You can now begin to sense how strange these words are to a people who are living under imperial Roman rule, coerced into submission in a land that is their own.  You may also begin to sense the awkwardness arising around you . . . the frustrated and shocking musings of a man whose ethics radicalize your own.

What does it mean to follow a man who died on a Roman cross . . . a political death used to strike fear into potential usurpers?  And what does this mean living in the greatest power on earth today?

What is your ethic?  What is your religious conviction?