The rise and fall of national capital

The threat of a new nationalism (1)

In a previous post, I worried that left populists would prosecute a war against all of neoliberalism’s hegemonic social forms, neglecting the progressive side of neoliberalism and sabotaging the chance for real progress. This may have struck some readers as counterintuitive: those of us pursuing a vision of human equality, solidarity, and true freedom are not used to thinking about neoliberalism as progressive in any way. The rapacity of economic elites freed from all constraints; skyrocketing inequality reshaping work, politics, and culture so that increasingly we are all reconstituted as servants or dependents of the rich; whole populations rendered unsuitable for participation in mainstream life by the economic disintegration of their social ecology; accelerating environmental degradation; intensifying exploitation – these are our associations with neoliberalism.

But neoliberalism is (or was) a social totality: all the dominant forms of the last thirty years were components of neoliberalism as a coherent system. That includes progressive (but not unproblematic) impulses like gender equality, multiculturalism, and skepticism of authority. Because the crisis of neoliberalism has manifested itself primarily in the economic realm, and these forms of consciousness have no clear connection to the economy, they are for the moment secure (what comes after neoliberalism will, however, reshape them – for better or worse). Under much greater immediate threat is one other progressive side of neoliberalism: the erosion of the nation form.

A Kinder, Gentler, More "Revolution-friendly" Regime of Accumulation?

“The object of our efforts is not “inequality” or “the one percent”, but the social totality and the revival of its animating dynamic on a new, more humane basis.” Walker, "Redistribution is not enough" (italics mine)

“Walker's program, though, is precisely to try and shape those new conditions of accumulation, which does require an active politics that seeks to mobilize rather than interiorize the critique of capital. If I recall correctly, when Walker first proposed that the pressing question was not the overcoming of capitalism, but re-establishing it on a more "humane" basis it was on two grounds: 1) it is unclear that the dissolution of capital under current objective and subjective conditions would lead to a more humane society and not our worst dystopian nightmare 2) that capitalism always tends towards crisis and that when "humane capitalism" did reach its crisis point, conditions would be more amenable for a positive overcoming.” AB, comments on the above.

“I think we can all agree (please correct me if I'm wrong) that popular subjectivity is generated by social conditions, and that present-day social conditions make socialism wildly implausible to the overwhelming majority of the world's population.
On that assumption, a Marxian strategy would aim at achieving social conditions that made the overcoming of capital seem a compelling answer to the insoluble problems posed by modern society.” Walker, additional comments on the above.

The above three quotes provide a succinct presentation of what seems like the predominant perspective on this blog. The goal, “try and shape those new conditions of accumulation” on a more "humane" basis” which also creates “social conditions that made(sic) the overcoming of capital seem a compelling answer to the insoluble problems posed by modern society”, has some very loaded presuppositions which I hope to bring out and unpack.

• The crisis that began in the 1970's can be encapsulated in the concept of Neo-Liberalism as a kind of “regime of accumulation” or maybe better a “regime of the crisis of accumulation previously known as Fordism”.
• Neo-Liberalism is on its last legs and a new regime of accumulation will automatically come into being, and it will either be more or less humane.

The crisis of valorization that crystallized in the 1970's has not ended. For a new period of valorization to begin we would need to see the destruction of even more capital, including human capital, and a degree of immiseration that would enable new capital, with a higher organic composition and new labor processes, to be implemented on a global scale. There are several strong indicators (and that is all I am referring to these as) that a new cycle of accumulation has not begun. 

The insignificance of billions of people

In a previous post, I argued that outside the three main value complexes of the global economy – Europe, North America, and East Asia – other parts of the world were essentially irrelevant to the immediate prospects for the expansion (or contraction) of global capital, except for what might happen in the commodities markets. The argument was both empirical – these two-thirds of the global population produce only one-fourth of global output – and conceptual: because the economic activity in these regions is small-scale, fragmented, and technologically backward, they are poor platforms for the accumulation of capital.

This was something of a provocation, because one of the noteworthy features of the neoliberal age has been a fascination among many critical and even many uncritical intellectuals with the peripheries and margins of capitalist society. It has often been taken as a progressive political act simply to pay attention to those parts of the world that are economically, and so politically and culturally, insignificant. Simply recognizing that these societies are insignificant is often considered unacceptable.

But their insignificance does not follow from racist or colonialist prejudice (though the existence of these phenomena is certainly bound up with it). Rather, it is a result of their marginality to the central processes of modern global society, above all the production and circulation of value. The inattention of the global media, the lack of representation in transnational organizations, the absence of global influence for their cultural products: these are all reflections of the real insignificance of peripheral countries as measured by the necessarily hegemonic standards of capitalist society.

The dangers of populism

The reigning metaphor deployed by all contemporary populism, whether of the left or the right, is theft: the government is stealing our earnings, the immigrants are stealing our jobs, the bankers are stealing our houses, the Greeks are stealing our government reserves, the Chinese are stealing our factories.

It’s no surprise that a popular subjectivity conditioned by neoliberalism should fixate on the illegitimate expropriation of value or its stand-in as the source of grievance. The experience of neoliberal society has made the free exchange of equivalent values the hegemonic ethical standard of our time. (Today’s populism, then, needs to be distinguished from that mobilized by Nixon through his racist silent majority. The resentment of the early 1970s backlash was not a response to perceptions of theft but to the existential challenge that the postwar white faced from blacks and student radicals. The abundant polemics (e.g.) that trace an unbroken line from the racist silent majority to today’s nativist and anti-tax right wing obscure this essential change.) For today’s populists, if you’re convinced you’re doing what you’re “supposed to be doing” – namely, working hard and taking responsibility for your own decisions – and things still aren’t going right, it’s only natural to assume it’s because someone is cheating you.

What is actually happening is not that some group of people is violating the ethical order, but that the social order that gave rise to that very ethic is itself breaking down.

Weak points in the global economy

A dangerous new year, Part 2 of 3

If there is to be an intensification of the crisis in 2012, where is it likely to start? At the moment, implosion in the eurozone seems the most likely possibility. The EU is probably already in a recession, and growth will be further strangled by the increasingly tight grip of austerity as the major economies of Italy and Spain implement the same measures that have already destroyed the Greek economy. With mounting social unrest and the increasing implausibility of recovery in Italy and Spain, investors will once again run for the exits, forcing the ECB and Germany to finally decide whether they will bail out the southern countries or set about drawing and quartering the euro.

Capital’s global terrain

A dangerous new year, Part 1 of 3

Among commentators, 2011 opened with naive optimism for a strengthening recovery, but developments across the year left that faith in shambles. This was no surprise to those of us writing on this blog. Most mainstream economic analysis is based on an uncritical reading of short-term statistics or transhistorical pseudo-mathematical models that are actually a projection of prevailing economic common sense. Neither approach is adequate when the entire structure of economic thought and practice is in the process of disintegrating.

In contrast, the approach we have been developing situates the ongoing crisis of neoliberalism in a much deeper understanding of capitalism and in the irreducibly historical configurations it assumes in order to sustain accumulation – which condition the operations of the economy and the nature of social life alike. Without access to either the historical or social-cultural dimensions of the economy, policymakers and economists alike still do not grasp the fundamental issue: neoliberalism has collapsed and cannot be revived. A new kind of capitalism would be necessary to revive growth.

This leaves us in a very dangerous position. Since leaders in the US and Europe alike have been busy deepening the crisis rather than pursuing the steps necessary to resolve it, the mainstream neoliberal approach embodied by people like Obama and Merkel faces a precarious future. Any sudden intensification of the crisis could leave it discredited, opening the door to those alternatives that are best organized and capable of presenting the most compelling arguments. Where these forces lead us may not be pleasant at all.

Redistribution is not enough

If the crisis of neoliberalism is a result of the collapse of the system of accumulation that prevailed for the last thirty years, where exactly is the immediate problem? We’ve already isolated productive investment (expanding value), robust demand (realizing value), and efficient technology (circulating value) as the key determinants of growth, so which of these has frozen up?

Demand is the obvious candidate.

Allowing the Crisis: Europe's Struggle for Discipline

Walker's recent discussion of the European situation is astute and important, especially his account of sovereign debt as an essential part of the continental model of neoliberalism. However, I don't think that it's sufficient to explain why debt is an issue to understand why it's come to a crisis at this moment and led to the kinds of responses we've seen. What I want to emphasize, and what I gestured toward in relation to Scott Walker's putsch in Wisconsin, is that there's been a trading off between the economic crisis and a political crisis. The Eurozone crisis is less about stagnant growth and more about reconfiguring and strengthening institutions of geopolitical discipline. It's not that the problems/solutions are in the political sphere, but that the nature of the crisis is best understood as a political crisis around the economic one.

When I say "discipline" and "political" I am not referring to a class conspiracy, I'm referring to the fact that the crisis is now being played out as a struggle to control the institutions that delimit what is and isn't allowed as opposed to the economic sphere which delimits what is and isn't possible. To be clear I know how problematic that statement is, there are no absolute objective social constraints but under capitalism the economy functions as if it were objective and it's pretty hard to change that.

Consider three moments of the Eurozone crisis: the fact that Italy is running a principal surplus; the installment of technocratic governments in Italy and Greece; and the most recent proposed "deal" to save Europe. At the core of all these is the role that bond markets play in deciding what will be allowed and a strengthening of the relationship between those priorities and the state.

The crisis of neoliberalism in Europe (2)

Part 2 of 2 | Part 1

Despite the differences between the US and Europe in the average citizen’s experience of life, there have been some striking similarities in the development of deeper structures in the world’s two biggest economies since the advent of neoliberalism. This indicates that the crisis in Europe is not merely a result of “contamination” from the American credit crisis of 2008, as many Europeans initially argued. Yet neither is it a result of solely European problems of excessive spending or lagging competitiveness, as many Germans and Americans believe. It is, rather, a constituent part of the ongoing crisis of global neoliberalism.

The crisis of neoliberalism in Europe (1)

Part 1 of 2

For many years progressives in the US have looked longingly to the social democratic states of Europe, and with good reason. Europeans enjoy a quality of life significantly higher than Americans, with more leisure time, better healthcare, and massively less social violence. Europe has extended this quality of life far more equitably, and has done so while producing far less environmental destruction. In fact, if the Occupy movement’s demands were actually met, the kind of society we might evolve toward would be basically the kind that Europe already has.

So as the crisis in Europe increasingly appears headed toward global catastrophe, it’s worth realizing that not only is the brutal neoliberalism of the US mired in crisis, so too is the much more pleasant version in Europe. 

Glossary: Economic growth

The upshot of the argument I’m developing here, but still haven’t actually laid out fully, is that the crisis of neoliberalism is fundamentally a crisis of growth. There are all kinds of mediating factors like the operations of the financial industry or the nature of the eurozone monetary system, but the deeper trigger of serious dysfunction in these realms and in the economy in general is the collapse of the neoliberal growth system. Before I complete this argument, we first have to understand what produces growth.

Awk-upy: Left Love and Shame

The latest issue of the Hypocrite Reader just went live with the theme "occupation." There are some interesting pieces (I'm personally a big fan of Debbie Hu's and Sam Feldman's) in it and one of my own. So by way of shameless self promotion here the introduction to mine. Also Occupy Elvis:

http://www.hypocritereader.com/10/awk-upy

The Open Letter to the Occupy Movement

I've been scarce on this blog for a few weeks. I've been busy dealing with Occupy Las Vegas, which is deeply problematic. I'm not going to air the dirty laundry here, not because I don't want to, but because I don't know how. More than being busy, engaging with this movement has been baffling and I've had enormous trouble coming to any analytical conclusions. My initial post about the history of the tactic was mostly just chronicling and name checking, which is easy but does little to move forward our understanding. I don't think that I'm alone in this bewildered speechlessness, and I think the awkwardness between the left and the occupy movement is in fact a crucial object for analysis.

Politicians have principles too

Facing the Democrats in the age of Occupy
Part 2 of 2 | Part 1

If the portrayal of the Democrats as corporate puppets is too simple, then how can we understand their insouciance in the face of the opportunities offered by the Occupy movement? The approach we’ve been developing on this blog, I think, allows for a more complete explanation. Neoliberal ideas proved appealing to Democrats not simply because they brought campaign contributions along with them, but because up until 2008 they seemed to make sense of the economy better than the progressive alternative and they demonstrated greater efficacy when pursued as policy.

Compare the path of Chicago and Detroit under neoliberalism. Under Fordism, both were thriving industrial manufacturing cities, but the restructuring of the global economy in the 1970s and 1980s undid these economic foundations. Chicago already had an important financial sector that the city’s political and economic elites transformed into the basis of a new, but deeply uneven, prosperity. Detroit had no such economic engine to fall back on and was destroyed.

Why won't the Democrats exploit Occupy?

Facing the Democrats in the age of Occupy
Part 1 of 2 | Part 2
In general, politicians are first and foremost opportunists. That doesn’t mean they’re without principles or ideology, but it means they tend to be flexible and instrumental about how to accomplish their goals. So the Democrats’ response to the Occupy Wall Street movements is rather mystifying. National Democratic leaders, while claiming sympathy with the protesters, have by and large decided to allow the movement to wither rather than seeking to draw its energy into the election cycle (compare the Republican Party’s response to the Tea Party). At the local level, Democratic mayors – from the far corporate end of the spectrum (Emanuel) to the former-organizer end (Quan) – have been at the forefront of unleashing police repression on the occupations.

This is a stunning repudiation of political advantage. The latest New York Times poll, conducted October 19 to 24, once again demonstrated that the silent majority of our moment supports a liberal-Keynesian approach to the crisis.