--This is my top priority topic, so let’s dive right in…
The Questionable: 1) Labels and Framing: --I tEconomic Democracy within Planetary Boundaries…
--This is my top priority topic, so let’s dive right in…
The Questionable: 1) Labels and Framing: --I think a manifesto should start broad for a wider audience, while having a coherent and principled direction. Thus, my go-to intro on degrowth remains Hickel’s Less is More: How Degrowth Will Save the World. --Saito’s book, while well-written, is more advanced in its framing (from labels to sources used). Is Saito’s use of the provocative label “degrowth communism” (after 3 chapters of build-up) effective?
1a) “Degrowth”: --I’m actually more frustrated by the confusion this label generates amongst radicals who are fine with labels like “socialism”! We can only excuse a part of this due to concerns over Malthusian elitist conservationism against the masses (ex. “overpopulation” fear-mongering conveniently hiding the elite’s colossal consumption/waste/control over production/investment), which I unpack in the messy Less Sucks: Overpopulation, Eugenics, and Degrowth. …However, it’s the political economy confusion from several of my top influences that I find perplexing. Critics like anarchist Chomsky (in The Climate Crisis and the Global Green New Deal: The Political Economy of Saving the Planet) and socialists/Marxists like Radhika Desai (see 56:33 of this video) always start with: sure, we need degrowth in certain areas, but we still need growth in areas crucial for social needs. …As if degrowth wants to stop everything from growing, including your children. …They simply avoid the anti-capitalist foundations of radical degrowth (which they share!) in order to confuse degrowth with (capitalist) austerity, leading to (capitalist) “stagnation”/recession. Palm meets face. …Desai then says Neoliberalism (since 1970s) actually hurts economic growth, implying economic growth is not a key driver of environmental overshoot: i) I assume Desai is confusing economic growth with “development”, which Neoliberalism did indeed sacrifice. ii) Even if the rate of annual GDP growth has lessened during Neoliberalism, the overall GDP is still experiencing compound growth (scary how unintuitive this rising curve is, as we always assume linear growth). The growth rate is applied annually to the growing base that includes previous growth; a constant 3% annual growth rate would mean total GDP doubles in 23 years! ...Of course, GDP is not directly the driver; it is an aggregate indicator of individual capitalists' goal of endless accumulation via profits/rents. Once again, the focus for capitalism's “economic health” (to prevent this volatile system from crashing) is on its extractive rates (flows; ever-more short-term; see Harvey's time-space compression) which contradicts with future costs/finite planet's resources (stocks; long-term)/their socioecological reproduction flows (long-term, from raising children to building communities to the biosphere's cycles). iii) Is Desai seriously recommending we return to the economic growth rate of post-WWII boom’s Military Keynesianism, the start of the “Great Acceleration” in overshooting planetary boundaries? (Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System) …Imagine applying that annual growth rate onto our current GDP! Are we trying to build a wind turbine for every person?!
--Degrowth’s anti-capitalist foundations: i) “Growth” here refers to economic growth, notoriously measured by the “GDP” (Gross Domestic Product: summing up the monetary value of domestic market transactions) normalized after its role measuring WWII war production. On a deeper level, market transactions require: a) “Artificial scarcity“: --Markets for “real commodities” long pre-date capitalism. Capitalism’s peculiar markets were born from the “Enclosures” in Britain which privatized land (creating the land market) so proto-entrepreneurs (financed by debt, thus the money market) could use it to produce wool and thus textiles as a (real) commodity for global markets; the serfs dispossessed of land had nothing to sell but their labour (creating the labour market). For more on land/labour/money being “fictitious commodities” (not produced just for buying/selling), see: Why Can't You Afford a Home?. --Common access had to be violently prohibited (removing freedoms for the many) in order to create great freedoms for the biggest property owners to extract the raw materials and labour (fictitious commodities) needed to produce (real) commodities, ensnaring the masses in market dependency to sell their labour, purchase their goods/services, pay their taxes, rent land, fall into debt etic. since they lost their means of production/autonomy (a foundational capitalist contradiction up to today’s automation). Saito calls this the “Tragedy of the Commodity”, to counter the "Tragedy of the Commons" myth. --The value system under capitalist markets is dictated by market exchange-value. A forest (with unquantifiable socioecological value) has no capitalist economic value, unless it is (1) cut down and sold (exchanged) as timber commodities, (2) privatized and rented or hoarded for fictitious exchange on speculative financial markets (ex. carbon offset markets), or (3) burnt down (where fire-fighting services stimulates market exchange, indeed GDP). This is the viral rationality of capitalism. --Saito references the Lauderdale Paradox theorizing the inverse relationship between public wealth (Commons) vs. private wealth (artificial scarcity), by the eighth Earl of Lauderdale’s 1804 An Inquiry into the Nature and Origin of Public Wealth. This was not able to dethrone Adam Smith’s glorification of capitalism’s private wealth accumulation benefiting the public in 1776’s An Inquiry into the Nature and Causes of the Wealth of Nations, as the socioecological costs of the rise of capitalism was conveniently externalized from the ivory towers and onto the masses (dispossessed working class in “dark Satanic mills”/urban slums without sanitation/coal mines/workhouses at home, to slave plantations/coolies/indigenous genocide abroad). b) “Radical abundance”: --Thus, degrowth challenges the growth of artificial scarcity to force labour/ecological services for the super-parasites’ endless accumulation. Beyond our basic needs (where capitalism still incentivizes linear waste rather than sustainable circularity: Gone Tomorrow: The Hidden Life of Garbage), capitalism’s logic is that of social addiction to keep its boom/bust elite accumulation going. --As capital is allowed to traverse the globe in nanoseconds, labour struggles to keep up as its increasingly-precarious hamster wheel of work (Bullshit Jobs: A Theory; The Precariat: The New Dangerous Class)/vapid entertainment/stress consumerism to recover from work (Captains Of Consciousness: Advertising And The Social Roots Of The Consumer Culture) keep us distracted from the use-value of a fulfilling life: autonomy not just for our own time but also for the socioecological communities we build with that free time. …Over-work, over-production with mal-distribution, addictive mass consumerism, all amidst artificial scarcity to discipline the masses and no value for socioecological relations, this quantitative cancerous growth is no longer achieving quality of life improvements (The Myth of Normal: Trauma, Illness, and Healing in a Toxic Culture). The value system to reverse this sickness is antithetical to the decay of today’s capitalism: decolonization, Commons (ex. People's Power: Reclaiming the Energy Commons), more free time and value for care-work and long-term ecological relationships, cooperation/reciprocity, universal social services, creative workers’ autonomy rather than disciplined division-of-labour, etc. --For debunking “green growth”, Saito mirrors the intro from Hickel’s Less is More, while also mentioning the use of planetary boundaries in Raworth’s Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist while noting Raworth is less clear on critiquing the capitalist root (production/markets/class).
ii) Degrowth targets the Global North’s overextraction of the Global South (The Imperial Mode of Living: Everyday Life and the Ecological Crisis of Capitalism), thus acknowledging the Global South requires “growth” to decolonize and improve their standard of living. …I would add that even the latter can benefit from an anti-capitalist degrowth lens: the Global South needs space (currently suffocated by rent-seeking foreign debt/intellectual property/cash crop trade dependency, which Global South elites also conveniently exploit) for radical alternatives to leap-frog over the Global North’s fossil fuel/artificial scarcity/class domination/crisis-ridden development path, otherwise the initial infrastructure would lock in the Global South for escalating emissions and little grassroots power to dismantle it! (Elsewhere, Saito references André Gorz’s “open” vs. “locking” technologies). …After all, the Global North’s path requires an external source (Global South) for super-exploitation and to externalize its many socioecological crises. …So much of capitalism’s wasteful means of production are already outsourced to the Global South. Of course, this is mal-formed into scattered subcontractors to promote ruthless competition and prevent substantial nationalization, which is why South-South cooperation is foundational to pool resources and de-link from Global North’s rent-seeking Finance capitalism (debt/intellectual property). -ex. article on IBSA and BRICS (IBSA: India, Brazil, South Africa: South-South cooperation where India shared its means of production in pharmaceuticals, blocked by Global North’s Big Pharma intellectual property rent-seeking). -Capital and Imperialism: Theory, History, and the Present -A People’s Green New Deal
1b) “Communism”: --While this label may become more viable for younger generations, the Cold War Red Scare era boomers (Blackshirts and Reds: Rational Fascism and the Overthrow of Communism) are a significant demographic owning most of capitalist assets. …Curiously, capitalism’s unparalleled volatility (recall The Communist Manifesto: “All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away, all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned”) is hidden in abstraction (ex. “hot money” gentrifying booms and capital flight busts), opening a vacuum for conservatives to scapegoat visible changes (immigrants, i.e. labour trying to catch up with capital movement). …Ex. Jordan Peterson’s critique of “chaos” (12 Rules for Life: An Antidote to Chaos) carefully avoids capitalism, putting the blame on Leftists who critique the status quo (assumed as stable, when in reality the volatility is built into the status quo: Thinking in Systems: A Primer). …Saito frames “communism” as following degrowth’s aim to reverse artificial scarcity/global finance dependency and build radical abundance of Commons, cooperation, and self/community autonomy, where economic democracy is foundational. …So, if we sum up these labels, I would say “degrowth communism” can be translated as “use-value economic democracy” or “economic democracy within planetary boundaries”. Labels will always be limited, so the sooner we jump to the content, the better.
2) Political Action…How?: --This topic is only briefly mentioned near the end; I would like more in a manifesto. …Saito repeats what seems like the standard academic-Left answer here: referencing “3.5 per cent”, the percentage of the population required for nonviolent civil resistance to win according to the research of Chenoweth’s Why Civil Resistance Works: The Strategic Logic of Nonviolent Conflict. This is also the centerpiece of Extinction Rebellion: This Is Not A Drill: An Extinction Rebellion Handbook --Saito also briefly outlines the lineage of direct action/participatory democracy/citizens’ assemblies: i) 1993 Via Campesina’s (“The Peasants’ Way”) international farmers’ cooperative struggling for food sovereignty/agroecology vs. capitalist agriculture’s capital-intensive monocrops/export crop trade deals/debts/intellectual property; 1994 Zapatista uprising in protest of the start of NAFTA. ii) Extinction Rebellion; Yellow Vests; Ecuador’s indigenous movements’ buen vivir (“to live well”); Standing Rock Dakota Access Pipeline protests; Barcelona’s “Fearless Cities” movement, etc. -A People’s Green New Deal -The Red Deal: Indigenous Action to Save Our Earth -This Changes Everything: Capitalism vs. The Climate
…see the comments for the rest of the review (“The Good”)......more
2023’s masterpiece maps out the unexpected demise of “Capitalism”…
Preamble: --Let us not get stuck on surface labels (which social media seems to amp2023’s masterpiece maps out the unexpected demise of “Capitalism”…
Preamble: --Let us not get stuck on surface labels (which social media seems to amplify into binary "agree"/"disagree" divisiveness) and forget to dive into the substance (where there is much to synthesize). --After all, how can a single term (even “capitalism”) encapsulate the contradictory mess of the real world (without many asterisks noting contradictions)? …Instead, I treat these concepts as lenses to view the world. Think of the difference between a microscope’s lens and a telescope’s lens. Each starts with certain assumptions (and limitations) which allows each to focus more clearly on certain observations. Depending on our questions, some lenses are indeed more useful than others. The challenge is to remember each lens’ assumptions when we try to synthesize the specific observations into a totality. --So, let us use the “Technofeudalism” lens and see what we can (and cannot) observe (i.e. from the history of capitalism to today’s New Cold War on China/war in Ukraine/Musk buying Twitter, etc.)…
Highlights:
1) ”Historical materialism”: a lens for human history: --It is a crime that so much of “history” is taught as a series of names/dates/events, missing the forest for the trees (on systems not being merely the sum of its parts, see: Thinking in Systems: A Primer). No wonder there is so much confusion with “human nature”, culture, and social change. --The gist of the “historical materialist” lens is to start with: i) Material conditions needed for human reproduction, ii) How humans relate to such material conditions to produce their needs, and the resulting class relations/political bargaining powers (which is reflected in culture, i.e. the stories that narrate our value system). …For more, see "What is Politics"? video series; start from the beginning, and note episodes: -"6. Political Anthropology: When Communism Works and Why" -"7. The Origins of Male Dominance and Hierarchy; what David Graeber and Jordan Peterson get wrong" -"7.1 Material Conditions: Why You Can't Eliminate Sexism or Patriarchy by Changing Culture" -"8. Materialism vs. Idealism: How Social Change Happens" --Varoufakis applies “historical materialism” using insights he received from his parents, which he later found in Marx’s works. In particular, a historical materialist lens views history as a process. Why process (i.e. change)? Why didn’t humans just figure out an optimal means of material conditions relationships and stick with it? …Along with the variations and changes in material conditions and class conflict, we find another key concept that plagues Marx: contradictions. Marx’s empiricist critics can say this is a black-box cop-out (i.e. how can we prove you wrong when you can say both yes and no?). But these empiricist critics are themselves plagued with quantification bias, by missing the importance of what they cannot quantify. Varoufakis found his father’s contractionary views of technology in Marx [emphases added]:
In our days, everything seems pregnant with its contrary: Machinery, gifted with the wonderful power of shortening and fructifying human labour, we behold starving and overworking it; The newfangled sources of wealth, by some strange weird spell, are turned into sources of want; The victories of art seem bought by the loss of character.
--Varoufakis’ father leans more on materialism in conceptualizing how human history sped up through its relations with technology: stone, then bronze, then iron. Varoufakis later pairs this by emphasizing the social (class/political bargaining power) side [emphases added]:
I speculated about what would have happened had James Watt invented the steam engine in ancient Egypt:
The most he could have expected is that the ruler of Egypt would have been impressed and placed one or more of his engines in his palace, demonstrating to visitors and underlings how ingenious his Empire was.
My point was that the reason the steam engine changed the world, rather than ending up a showpiece in some ruler’s landscaped garden, was the epic raid on the common lands that had preceded its invention: the enclosures [see later].
2) Feudalism to Capitalism: --The aforementioned “Enclosures” are key in Polanyi’s “great transformation” from feudalism to capitalism, by creating the 3 peculiar capitalist markets of land/labour/money: i) land: privatization of Common lands (the “Enclsoures”) aimed to use these lands to produce commodities (i.e. wool) for the global market (the new source of wealth/power, rather than feudal lords merely sitting on land), thus creating the land market ii) labour: the dispossessed serfs became the labour market. iii) money: proto-capitalists in the wool industry started with credit/debt from the money market. Under capitalism, finance precedes production. …See Varoufakis’ Talking to My Daughter About the Economy: or, How Capitalism Works—and How It Fails. --Varoufakis reminds us of this prior transition [emphases added]:
As consecutive mutations multiply the variants of an organism until, at some point, a brand-new species appears, so technological change proceeds within a social system until, suddenly, the system has been transformed into something quite distinct, though that doesn’t mean that all of the materials out of which the system is built – capital, labour, money – have necessarily changed. […]
Suppose we were living in the 1770s [First Industrial Revolution], as the first steam engines began driving the water pumps that kept the mines dry and turning the wheels of William Blake’s ‘dark satanic mills’. […] we would not be wrong to speak of an emergent ‘industrial feudalism’ or ‘market feudalism’. Technically, we would be correct.
In the 1770s, and for at least another century, wherever one looked one saw feudalism. Feudal lords dominated rural areas, owned the freehold titles of most city blocks, commanded armies and navies, and presided over parliamentary committees and government bodies. Even in the 1840s, as Marx and Engels were writing their manifesto in response to the worldwide effects of the capitalist class, most production was still taking place under the auspices of the old feudalist class, the landed gentry. Land ownership remained the main source of political authority and rent continued to be more powerful than profit, especially in the aftermath of the Napoleonic Wars [1803-1815] when landlords regained the upper hand over capitalists by banning grain imports with their Corn Laws [1815-1846].
And yet something critically important would have been lost if those who forged the language of that era had been reluctant to ditch the word feudalism, choosing to call the nascent system not capitalism but industrial or market feudalism. By boldly calling it capitalism, a century before capital had fully dominated our societies, they opened humanity’s eyes to the great transformation unfolding around them as it was happening.
3) “Capitalism”: volatility and contradictions: --Varoufakis centers Adam Smith’s distinction between: a) Profits: new wealth initiated by capital investments, which other capitalists can also initiate, thus profit is vulnerable to market competition over prices/quality. b) Rent: privileged access to a fixed supply (the obvious example being nature’s resources, esp. land and fuel). --Note: for profits, Smith focuses on the production of “real commodities”, where the rising wealth/power of the global market drove the "great transformation" from landlord feudalism to Industrial Capitalism. Classical liberal economics anticipated the latter, with the value system switching from land (feudal ownership) to labour (key input in commodity production; i.e. the Classical “labour theory of value”, focusing on reducing the cost of production, ex. the factory's “economies of scale”). ...However, there's an obvious growing contradiction that Varoufakis does not seem to emphasize. The rise of the global market (in “real commodities”) led to the creation of capitalism’s 3 peculiar markets (land/labour/money), which feature “fictitious commodities” (humans/nature/money) which are not “produced” (with a “cost of production” calculated by capitalists) simply to be bought/sold on markets. These 3 capitalist markets are particularly susceptible to rent-seeking! i) land: ground rent ii) labour: imperialist rent, unwaged care-work iii) money: usury (interest) --Note: Smith had a major contradiction in his works on the source of profit, between (a) capitalists employing their capital vs. (b) labourers doing the work (“labour theory of value”); Smith also conveniently assumed capitalists obtained their capital through hard work/savings (i.e. “primitive accumulation”, where primitive means “prior” and later critics assumed as “violent”), which Marx critiques in the last part (“Part 8: So-Called Primitive Accumulation”) of Capital: A Critique of Political Economy, Volume 1 highlighting the violence of the enclosures/creation of capitalist property/markets (given Marx’s appreciation of class conflict). --Varoufakis stresses how rent survived as a parasite, thus the driver (host) has been profit. Parasites require disguise, thus rent has tried to disguise itself as profits (ex. oil companies access/real estate ground rent/privatized utilities monopolies). --Elsewhere, Varoufakis notes how steel was still rare in the First Industrial Revolution, and the primary material reliance was on slavery/colonialism. I would synthesize this observation with the profit vs. rent definitions given by Smith, as Classical (liberal) economics had major omissions: i) imperialism (Capital and Imperialism: Theory, History, and the Present), ii) environment (Less is More: How Degrowth Will Save the World; also, Jason W. Moore centers “cheap nature” in defining capitalism), and iii) social reproduction/care-work (The Invisible Heart: Economics and Family Values). …Thus, rent may be a parasite on profit, but profit is a parasite on all these “externalities” (beyond direct exploitation of wage labour); centering profit as the key driver of capitalism is useful in recognizing capitalist accounting, but we must also account for the externalities which capitalism requires to reproduce itself. --By the Second Industrial Revolution (1870-1914 WWI), steel becomes mass produced, and private bank money facilitates mass production. However, the capitalist contradiction of saturated markets (falling rate of profit/lack effective demand) led to imperialist rivalries leading to global industrial carnage (late 19th century Europe/WWI/WWII).
...See the comments below for the rest of the review: "4) Capitalism’s mutations" "5) Technofeudalism"...more
Preamble: --In a reading group, our consensus response was rather lukewarm; there was much to agree with, but we wCapitalism’s Absentee Ownership 101…
Preamble: --In a reading group, our consensus response was rather lukewarm; there was much to agree with, but we wanted the next steps. This seems to stem from uncertainty over the book’s target audience. …The book is short enough to be an intro, but the topic is inherently abstract; thus, some parts are rather clunky as contextual explanations are not provided. --Still, upon reviewing my notes, I may be the most positive in our group towards this book’s potential. The subject of capitalist ownership is foundational, so I’ll focus on (and supplement) the good.
The Good:
1) Ownership and Dispossession: --Ownership is relational, between: a) Owner: exclusive rights to property/assets/resources. This is the side which proclaims “freedom” and “liberty”. b) Non-owner: dispossession via, in capitalism's case, an ongoing history of Enclosures/colonization/privatization (backed by direct or threat of violence, usually from the capitalist State); unfreedoms; dependency on owners. …So much for “equality” and “fraternity”. --Laws dictate what can be owned/by who/what can be done with it/how this is enforced/how property can be exchanged. Laws stem from politics (see: “What is Politics?”), i.e. group decision-making based on bargaining power. This is not some vague and inevitable “human nature”, but an ongoing struggle with contingencies esp. given capitalism’s volatilities (A People's History of the World: From the Stone Age to the New Millennium).
2) Ownership vs. Management: --A key contradiction of capitalism identified by Marx and shared by Keynes is the growing divergence between the following roles: a) Ownership: shareholders trading in passive property claims (company shares) for returns via dividends/capital gains, thus impersonal/absentee/rentier (for a distinction between “rent” vs. “profit”, see: Technofeudalism: What Killed Capitalism). b) Management (“control”): managers directing the active property of the corporation’s assets, compensated by wage income.
--Historical context: i) The “capitalist” started as a single owner-manager, occupying both roles. Note: the book only provides a one-liner on this; there is so much to unpack here, including the “transition” debates on feudalism-to-capitalism (ex. between Orthodox Marxists vs. World-Systems Analysis: An Introduction). ii) The modern corporation accelerated the separation of the roles. Note: the book does not unpack connections with colonial joint-stock (also limited liability) companies (ex. East India Company, 1600-1874) nor the context of Marx’s analysis. iii) Next, the book skips ahead to the post-WWII Bretton Woods period, the “Golden Age of Capitalism” (which I would describe as the “Golden Age of watered-down Socialist policies after War-time Planning”). …This brief aberration in capitalism also saw global finance restricted (the Great Crash/Depression still fresh in the minds of New Dealer reformists) and shareholders dispersed, with managers in charge (“managerial capitalism”). The corporation was driven by reinvestment of internal profits, thus sheltered from stock market financial pressures. iv) This brief aberration succumbed to contradictions on numerous levels (some I’ve added) by the late 1960s, from the geopolitics of US’s genocidal military spending losing US’s gold reserves (Super Imperialism: The Origin and Fundamentals of U.S. World Dominance) to the threat of decolonization upending capitalism’s global prices (The Darker Nations: A People's History of the Third World) to other profit-squeezing pressures (A Brief History of Neoliberalism). …This all led to the unshackling of US Finance (Wall Street; The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy). v) On the ideological side, pro-shareholder rhetoric was a backlash against the threat of activist managers taking advantage of diffused passive shareholders: “agency theory” tried to frame shareholders back into control (“shareholder primacy”) dictating the goal of the corporation (“shareholder value maximization”). vi) Behind the rhetoric, this was about gaining power for absentee owners (“rentier”; “passive income”; think of all the glossy self-help business books today, like The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich). Profits were still mostly made by extracting surplus value from production (Marx’s Capital: A Critique of Political Economy, Volume 1), but now more was distributed to shareholders (dividends/capital gains) rather than to workers/managers (wages) or back to the corporation (reinvestment). …Note: “owners” and “managers” here describe roles rather than individuals. An individual can still play both roles (in differing contexts); indeed, top managers (given their own personal investments) often supported this pro-shareholder shift. vii) This meant the corporation’s performance suffered, where equity investment (new share capital) dwindled compared to new bank loans/corporate bonds (capital gains speculation). “Shareholder activism” meant short-term pillaging of corporations (“corporate raiding”; Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy). viii) Clearly, “shareholder activism” actually meant getting others to do the activism (work) on behalf of shareholders (passive income). Thus, the age of inequality saw the rich relying on “passive investing” via indices (portfolios pooling many companies representing entire markets), leading to the rise of “Asset Manager Capitalism” and its big-3 asset management firms (the intermediaries who control the funds): BlackRock/Vanguard/State Street. ix) Keynes:
Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes a bubble on a whirlpool of speculation. When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done.
…Traditional bank lending (longer-term, profiting on the interest spread) gave way to securitization (turn the lending into “financial products” to immediately sell off): Why Can't You Afford a Home?…Thus, as COVID-19 devastated a fragile real economy, capitalist stock markets boomed as central banks refloated the “whirlpool of speculation”.
3) Ownership vs. Socialization of Production: --Managers are only the tip of the contradiction iceberg, since the actual work is being done within the increasingly-socialized production of the corporation by the workers (i.e. corporations being islands of planned economies: The People’s Republic of Walmart: How the World’s Biggest Corporations are Laying the Foundation for Socialism). --Thus, the book briefly considers the historical context of the corporation, from its colonial public/private ventures to US corporate law granting the corporation legal personhood some 130 years ago (The Corporation: The Pathological Pursuit of Profit and Power). Corporations were granted free speech (lobbying bribing politicians) via the Citizens United case, etc. Limited liability protected shareholders during bankruptcy, leaving the rest of the costs to the actual stakeholders (workers and local community). --To re-purpose the corporation: i) Purpose: passive income for shareholders vs. social needs for stakeholders ii) Membership: financial intermediaries vs. participatory stakeholders (via modified corporate share/new purposeful ownership). iii) Governance: capital markets/institutional investors/executives vs. stakeholders (labour/socioenvironmental community). iv) Capital: laws that flood shareholders with credit while creating scarcity for alternatives. This also relates to Global North states having public debts owed to themselves (ex. via their own central banks), whereas Global South states are forced to borrow on global markets. Foreign debts can be owed to other states (bilateral) or to private investors, with the big-3 asset management firms buying them up. …The book focuses on the state power of central banks esp. during crises to re-negotiate controlling stakes in corporations rather than merely bailout shareholders; alternatives: public utility credit/public banking; public investment credit guidance; restrict demand for absentee ownership. v) Networks: siloed artificial scarcity of markets vs. socially-guided markets/non-market commons. …I find much clearer analyses of re-purposing corporations in Another Now: Dispatches from an Alternative Present. --Expanding to the entire society, the foundations: i) Democratic ownership: shared inheritance/community wealth/participatory stakeholders ii) Social planning: Commons/stewardship/universal basic services (de-commodification) iii) Public investment: under modern capitalism, investment is dominated by violence (military/prison industrial complex) to preserve artificial scarcity rather than unprofitable social needs; even automation is stunted when there is cheap labour. And automation from toil is no salvation under capitalism since workers do not own the machines, so will be greeted with structural unemployment amidst artificial scarcity on access to needs.
...see comments below for the rest of the review ("The Missing")......more
Preamble: --An antidote to Capitalist Realism: Is There No Alternative?… --Let me re-trace the steps that led me to consider a speculative fiction as my most-enjoyable read of the year: i) For context, fiction is buried in my list of reading priorities, relegated to when my brain is in a stupor. I’ve just found little success in fiction for the questions that haunt me. ii) The last fiction to captivate me is Varoufakis’ 2020 Another Now: Dispatches from an Alternative Present; however, this was assisted by the (geo)political economy that was at the center of the book (i.e. structurally, how could capitalist markets for labour/finance/land, global trade imbalances, etc. be abolished). iii) This year, I’ve been systematically (re)reading Graeber (RIP), in particular his under-read magnum opus Direct Action: An Ethnography (written in 2009, before Graeber’s 2011 breakthrough Debt: The First 5,000 Years). One highlight is analysis/demonstration of the uses of speculative/science fiction and ethnography… iv) …And, lo and behold, I encounter this book which combines speculative/science fiction and ethnography (oral histories)! What a perfect playground to experiment with Graeber’s analyses (wish Graeber had found the time to write a sci-fi)!
Highlights: --Each one of these 12 short-story oral histories deserves a full-length book, which I would read (12-for-12 is a stunning success rate for me!). Overall reflections:
1) Capitalist Realism or Capitalist Crises? --Before we imagine alternatives, we need to be clear on the present situation. In the next section, we’ll explore why fiction seems to avoid carefully unpacking “capitalism” (i.e. political economy). In this book’s (fictional) introduction:
Unfortunately, explaining the global market before liberation is beyond the scope of this project. We highly recommend Understanding the Capitalist Market, Understanding the Geopolitics of Imperialist Nation States, and Understanding Wage Dependency as supplemental reading to this section [these are fictional works].
--My one-line summary of “capitalism”: the commodification of society, in particular the peculiar markets of labour/land/money featuring the “fictitious commodities” of humans/nature/purchasing power, which are not “produced” just for selling/buying on markets. Yes, Polanyi’s The Great Transformation: The Political and Economic Origins of Our Time is an exhausting read for this, but luckily we have eloquent nonfiction like Talking to My Daughter About the Economy: or, How Capitalism Works—and How It Fails to introduce this. I’ve also summarized Fraser’s synthesis of Marx + Polanyi here. --I find this political economy builds a strong foundation to appreciating the underlying contradictions of capitalism, whereas most historical accounts only reveal the brief surfacing of crises (consider: Thinking in Systems: A Primer). --“Capitalist Realism” cannot be a totality; this cancer/virus could not have survived without its host. Capitalism is dependent on: i) outsourcing its contradictions (slavery/colonialism/imperialism, settler colonialism), and ii) watered-down socialist policies (so social reproduction is not extinguished). …Vivid examples include the Enclosures/Industrial Revolution’s commodification (and degradation) of humans/nature to create the labour/land markets in brutal workhouses and “dark Satanic Mills”, culminating in a social crisis in Europe only relieved by: i) settler migration (relief to Europe’s labour market), and ii) public sanitation/health policies (relief to social reproduction): Less is More: How Degrowth Will Save the World --Thus, this books recognizes: i) looming capitalist crises, ii) the opportunities they present as the status quo crumbles iii) to expand socialist causes, some already somewhat in practice out of necessity; see Debt: The First 5,000 Years for Graeber’s “actually-existing communism” (in contrast to myths of “primitive communism”/“mythic communism”/“epic communism”):
But all social systems, even economic systems like capitalism, have always been built on top of a bedrock of actually-existing communism.
Starting, as I say, from the principle of “from each according to their abilities, to each according to their needs” allows us to look past the question of individual or private ownership (which is often little more than formal legality anyway) and at much more immediate and practical questions of who has access to what sorts of things and under what conditions. Whenever it is the operative principle, even if it’s just two people who are interacting, we can say we are in the presence of a sort of communism.
--Crises: national states become increasing vulnerable to social protest. States are unable to maintain social reproduction/outsource its contradictions under the mounting burden of the parasitic/volatile finance (speculative gambling/debts for rent-seeking) and accelerating ecological collapse, bringing down the “middle class” (who have been an essential buffer for “Capitalist Realism”). When things we take for granted collapse (ex. car transportation), seemingly insurmountable social norms follow (ex. car culture); paraphrasing Assange, humans are extremely adaptive to both change (heroic efforts to survive) and status quo (tragic efforts to tolerate oppression). A Paradise Built in Hell: The Extraordinary Communities That Arise in Disaster …One of the states to collapse is China, which opens up a can of worms on really-existing socialism. I’ll bypass this (still working to synthesize with Graeber’s analysis of “bureaucracy”) by saying that Western imperialist states also collapse, so the siege is over… these other crises include: i) collapse of the US dollar (“dedollarization” has recently become a trendy topic, so we need to dig deeper: Super Imperialism: The Origin and Fundamentals of U.S. World Dominance) ii) even the US military, with its overreach attacking Iran leading to mutinies. While many Leftists are allergic to studying the US military given its endless layers of imperialism/conservatism, we should not all abandon careful study of its contradictions, including its dissenters from War is a Racket: The Antiwar Classic by America's Most Decorated Soldier to Veterans for Peace, to comparisons between wartime mobilization and the Green New Deal (which must be analyzed with extreme caution! For a critical take that re-centers the Global South: A People’s Green New Deal). Similarly, Graeber points to the academic bias where academics attribute importance to what is intellectually interesting (thus, neglecting the importance of sheer violence with all its vulgar stupidity). iii) further pandemics (Dead Epidemiologists: On the Origins of COVID-19); collapse of capitalist healthcare [emphases added]:
Of course, it wasn’t the doctor who had really turned grannie away [for not having health insurance]! It was the hospital! And who was the hospital? It was whoever was making money off it, and those faces were invisible. It was the whole fucking system. I remembered these pamphlets that people would hand out on the subway or on the street or that people would forward to me. Things about how the system was broken, how it was capitalism, etc. I always thought, “I don’t have time for this,” or “I don’t have energy for this.” But then I realized, “I don’t have time because of this. I don’t have energy because of this.” This system had taken everything from me, from us. It had taken my mom, my grannie—even myself. It had even taken me away from me.
iv) collapse of academia (capital tied to volatile finance):
Like, the universities are gone, of course, or the idea these specialized fields of knowledge are separated out from the rest of life or not subject to the same logic of profit and exchange. But, in this other way, the zeal for knowledge was saved. Way, way more people read and debate philosophy and theory than ever when I was growing up.
v) We should add Varoufakis’ hacktivism targeting the fragility of financial risk in Another Now: Dispatches from an Alternative Present and supply chain vulnerabilities in Choke Points: Logistics Workers Disrupting the Global Supply Chain.
…See the comments below for the rest of the review: “2) Synthesizing the Left’s conflicts” and “3) Resilience in Diversity”…...more
Preamble: --Of the 3 intros to degrowth I’ve read, I would rank as follows: i) Hickel’s Less is More: How A toolbox to build Degrowth as common sense…
Preamble: --Of the 3 intros to degrowth I’ve read, I would rank as follows: i) Hickel’s Less is More: How Degrowth Will Save the World: foundational. ii) This book: useful survey on "why?", but missing "how?". iii) Saito’s Slow Down: The Degrowth Manifesto: niche insights, also missing "how?". Since Saito uses the label “degrowth communism”, my review of Saito’s book discusses how labels can be such distractions. I’m fine with “post growth” if “degrowth” sounds negative. Let’s move on.
The Good: --This book’s key feature is to synthesize the diverse influences of “degrowth” to raise awareness of an alternative common sense (already existing in diverse movements) to challenge the growth paradigm (which on the surface seems insurmountable). --Using Wallerstein’s framing, we can see how far the growth paradigm stretches: a) Pro-Capitalist (“Spirit of Davos”, home of the World Economic Forum): --Liberal growth: including those trying to address climate change, like Bill Gates (How to Avoid a Climate Disaster: The Solutions We Have and the Breakthroughs We Need) --Reactionary growth: for “reactionary” in general, see The Reactionary Mind: Conservatism from Edmund Burke to Donald Trump b) Anti-Capitalist/Socialist (“Spirit of Porto Alegre”, home of the World Social Forum): --Left growth (productivism) --Left degrowth: there are opposing ideologies that may also critique growth (i.e. conservative/green fascism/anti-modernism/liberal environmentalism), but the book distinguishes “degrowth” for its (Leftist) socioecological justice principles.
--Here is the toolbox assembled:
1) Ecological: --Referring to Ecological/Biophysical Economics, the focus here is society’s material/energy throughput (vs. sources) and waste (vs. sinks). --This tradition has a strong critique of mainstream (“Neoclassical”) Economics, which conceptualizes “the economy” as a circulation of inputs (labour/capital/money/goods), where growth stems from knowledge/technology/capital. Crucially, Neoclassical Economics assumes circular reproduction of its inputs while dismissing the environment (raw materials/energy/land) and reproductive labour (mostly unwaged). See Keen’s The New Economics: A Manifesto --The critique uses systems science (Thinking in Systems: A Primer) to consider the flows (energy/materials extracted, used and wasted; also monetary flows) and stocks (sources and sinks; also biomass/infrastructure/artifacts), revealing society’s expanding social metabolism of material/energy, including the “Great Acceleration” since WWII: -Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System -Earth System Science: A Very Short Introduction --The material analysis is clear: growth is now unsustainable (overshooting our planetary boundaries); degrowth is inevitable, so we must choose “degrowth by design” to avoid “degrowth by disaster”. Further analysis reveal “green growth” resulting in energy addition rather than energy transition (to sustainability), where empirical material flow analysis reveals the hope of “decoupling” economic growth from material/energy use as insufficient (relative efficiency gains are swamped by absolute increases), etc.
2) Socioeconomic/Anti-Capitalist: --I combined “socioeconomic” with “anti-capitalist” as I don’t see a proper distinction made in the book. --Referring to Wallerstein’s conception of the “modern world system” (capitalism), the roots are traced to the 16th century European arms race (“war capitalism”), leading to colonial enterprises which developed into joint-stock companies (The Corporation: The Pathological Pursuit of Profit and Power). For a debate (I prefer a synthesis) on this with orthodox Marxism, see Wallerstein’s World-Systems Analysis: An Introduction. --Capitalism’s endless accumulation transformed social metabolism from circular to linear. Given capitalist profit-seeking’s constant and systemic disruptions, capitalism requires growth to attempt “dynamic stabilization”, to buy off/compromise with enough of the population to preserve social consent (ex. post-WWII’s welfare state/mass consumerism, reliant on fossil fuel growth). --There is so much to synthesize regarding economic growth as a mismeasure of social needs: i) Over-values: “exchange-value”/instantaneous market exchange; pathologies of consumerism where advertising is meant to manufacture dissatisfaction and dependency for growing purchases rather than long-term fulfilment (Gone Tomorrow: The Hidden Life of Garbage); positional consumption to “keep up”… …Intensified division-of-labour (turning humans into cogs, smashing autonomy and creativity…“you don’t hate Mondays, you hate capitalism”; alienation; over-work), etc. The wealthy rely on passive income (Owning the Future: Power and Property in an Age of Crisis), while the rest are over-exploited (The Divide: A Brief Guide to Global Inequality and its Solutions) and/or over-alienated (Bullshit Jobs: A Theory). ii) Under-values: “use-value”/long-term socioecological needs, well-being/Quality of Life, non-monetary relationships (esp. social reproduction/ecology), leisure time (required to build long-term socioecological relationships), equality/accessibility (vs. market’s one-dollar-one-vote), participatory democracy, etc. -Doughnut Economics: Seven Ways to Think Like a 21st-Century Economist
3) Cultural: --The book traces the rise of capitalist liberalism: i) Ideologically separating “the economy” as a separate sphere with its own laws ii) Post-WWII’s “Modernization” theory of economic development, to counter Soviet socialism and Third World decolonization (The Darker Nations: A People's History of the Third World). --This overlaps with worker alienation, consumerism, etc.
4) Feminist: --Referring to Eco-feminism and Feminist Economics, the focus here is on capitalism’s devaluation of reproductive labour, with the alternative of a care economy.
5) Anti-industrialist: --As noted earlier, the book does contrast degrowth vs. “anti-modernism”, describing the latter as vulgar anti-technology/anti-civilization. --Thus, degrowth’s anti-industrialist critique centers around capitalism’s undemocratic technologies disciplining workers into cogs; the alternative is participatory democracy. The machine-breaking Luddites were actually protesting for workers autonomy rather than completely rejecting technology/civilization.
Preamble: --I’m so far behind on reviews, so why not set the bar high for 2024? …This book synthesizes so muc1975’s Vision of Sustainability in the US…
Preamble: --I’m so far behind on reviews, so why not set the bar high for 2024? …This book synthesizes so much of what I’m currently prioritizing: i) Constructive alternatives (including big picture political economy), rather than just deconstructive critiques (like Capitalist Realism: Is There No Alternative?). ii) Accessible writing (engaging story-telling). iii) Insightful context (written in the US in 1975 at the end of the US war on Vietnam, after the 1971 Nixon Shock and 1973 First Oil Shock).
--The story takes place 20 years after “Ecotopia” (formerly Washington/Oregon/Northern California) secedes from the US, through the eyes (and evolving perspectives) of a US journalist investigating this protective haven. ...I’ve grown up in the Pacific Northwest, so this reminds me of the Cascadia movement which shifts the bioregional boundaries north to include Canada’s British Columbia province (to be clear, I only heard about this “movement” in an obscure reference). --In the real world, the author channels the “People’s Republic of Berkley” progressivism in this book, which apparently influenced Green parties in the Global North (esp. Germany’s). ...Unfortunately for the US in the real world, Nixon’s presidency (1969-1974) marked the last of welfare compromises (Environmental Protection Agency, Occupational Safety and Health Administration) as Wall Street was unleashed following the Nixon shock (A Brief History of Neoliberalism). …Only recently has the US seen any signs of a progressive revival, with the Global Justice Movement (1999 Seattle WTO protests)/Occupy Wall Street (2011)/Bernie Sanders campaigns/Sunrise Movement.
Highlights:
--I’ll skip the story/characters and unpack the nonfiction ideas:
1) Pragmatic Survival rather than Utopia: --How is the basic responsibility of “sustainability” so radical/utopic to consider? Well, it turns out “capitalism” is the creation that we have lost control of, haunting our social imagination from 1818’s Frankenstein to 1936’s Modern Times (featuring Charlie Chaplin) to 1999’s The Matrix. --Capitalism must feed the increasing appetite of the 1%, as these top capitalists dictate investments in capitalist markets (one-dollar-one-vote). "All that is solid melts into air", as capitalism’s value system is driven by market exchange-value (price, seeking profits/rent), obscuring use-value (qualitative; social needs) and socioecological relationships. …This game’s cancerous logic promotes extremist short-termism (financial trading in nanoseconds, boom/bust speculation, quarterly returns), staggering inequalities (passive income, where money does grow on trees) and “out of sight, out of mind” apathy where socioecological costs are externalized from market prices. I unpack this in reviewing A Companion to Marx's Capital --Thus, Ecotopia starts with pragmatic survival: learning how things work (esp. production), building a culture of fixing things, cooperation and social organisation, and learning to live with our contradictions (rather than expecting utopic perfection). --The book’s symbolic example of building a “stable-state” ecological system is recycling waste (food waste/sewage/garbage) into organic fertilizers. Waste is a clear example of capitalism’s “out of sight, out of mind” logic, starting with the decimation of the public's standard of living during the rise of capitalism’s Mordor-esque industrialization/“dark Satanic mills”/urban slums. It took proto-socialist struggles to win the bare minimum of sanitary disposal (note: this is still not recycling):
It wasn’t until nearly 400 years later [since capitalist privatizations at home in Britain, i.e. the Enclosures starting in 1500s] that life expectancies in Britain finally began to rise. […] It happened slightly later in the rest of Europe, while in the colonised world longevity didn’t begin to improve until the early 1900s [decolonization]. So if [capitalist economic] growth itself does not have an automatic relationship with life expectancy and human welfare, what could possibly explain this trend?
Historians today point out that it began with a startlingly simple intervention […]: [public] sanitation. In the middle of the 1800s, public health researchers had discovered that health outcomes could be improved by introducing simple sanitation measures, such as separating sewage from drinking water. All it required was a bit of public plumbing. But public plumbing requires public works, and public money. You have to appropriate private land for things like public water pumps and public baths. And you have to be able to dig on private property in order to connect tenements and factories to the system. This is where the problems began. For decades, progress towards the goal of public sanitation was opposed, not enabled, by the capitalist class. Libertarian-minded landowners refused to allow officials to use their property [note: the Enclosures required state violence to privatize land], and refused to pay the taxes required to get it done.
The resistance of these elites was broken only once commoners won the right to vote and workers organised into unions. Over the following decades these movements, which in Britain began with the Chartists and the Municipal Socialists, leveraged the state to intervene against the capitalist class. They fought for a new vision: that cities should be managed for the good of everyone, not just for the few. These movements delivered not only public sanitation systems but also, in the years that followed, public healthcare, vaccination coverage, public education, public housing, better wages and safer working conditions. According to research by the historian Simon Szreter, access to these public goods – which were, in a way, a new kind of commons [social Commons] – had a significant positive impact on human health, and spurred soaring life expectancy through the twentieth century. [Less is More: How Degrowth Will Save the World]
…While domestic workers organized bargaining power to improve their workplaces/cities, global capitalism continued its cancerous extraction “out of sight” in peripheral environments/colonized poor. Eco-socialists will know that Marx warned of (what is now termed) the “metabolic rift”:
Capitalist production collects the population together in great centres [concentration of production], and causes the urban population to achieve an ever-growing preponderance. This has two results. On the one hand it concentrates the historical motive power of society [urban working-class, i.e. proletariat]; on the other hand, it disturbs the metabolic interaction between man and the earth, i.e. it prevents the return to the soil of its constituent elements consumed by man in the form of food and clothing; hence it hinders the operation of the eternal natural condition for the lasting fertility of the soil. […] Moreover, all progress in capitalist agriculture is a progress in the art, not only of robbing the worker, but of robbing the soil; all progress in increasing the fertility of the soil for a given time is a progress towards ruining the more long-lasting sources of that fertility. […] Capitalist production, therefore, only develops the techniques and the degree of combination of the social process of production by simultaneously undermining the original sources of all wealth – the soil and the worker. [Capital: A Critique of Political Economy, Volume 1, Ch.15 section 10; emphases added]
…Today, normalizers of capitalism like Bill Gates (How to Avoid a Climate Disaster: The Solutions We Have and the Breakthroughs We Need) refer to his favourite author Vaclav Smil (How the World Really Works: A Scientist's Guide to Our Past, Present and Future) to dismiss such critiques/alternatives as regressively primitivist and point to the scale of capitalism’s adaptations via technological innovations, in this case inorganic/synthetic fertilizers (Enriching the Earth: Fritz Haber, Carl Bosch, and the Transformation of World Food Production). …The assumptions unchallenged are capitalism’s historic levels of inequality/waste/manufacturing of wants (Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System), which are flattened and normalized as “human nature”; even if we do not all currently consume like billionaires, the assumption is we aim to. It’s convenient how mainstream systems-thinkers refuse to examine the capitalist system.
See comments below for the rest of the review…...more
2020’s masterpiece maps out today’s capitalism and, step-by-step, an alternative postcapitalism.
--The writers I find most inspiring are ones who can 2020’s masterpiece maps out today’s capitalism and, step-by-step, an alternative postcapitalism.
--The writers I find most inspiring are ones who can take concepts that require a lifetime of learning and present them in such an accessible, engaging manner (another is David Graeber, RIP). --If you’re new to Varoufakis/critical economics, his Talking to My Daughter About the Economy: or, How Capitalism Works—and How It Fails is a delightful primer. If you want to dive right in, the sci-fi storyline is a clever format to unravel the wealth of thought-experiments, devil's advocates, fables and paradoxes. I won’t spoil the sci-fi; I’m here to unpack today’s capitalism and the proposed alternative.
There is no alternative (TINA), if you cannot define the problem: --Everyday conceptions of today’s capitalism are often vague (“human nature”, “progress”, “efficiency”, “liberty”) and myopic (“get a job and stop complaining”, “...and yet you participate in it”). It is eerie how successful the education system and labor market have been in churning out professionals with such compartmentalized skill-sets and experiences (with a particular omission of critical, real-world economics). --The most effective power hides itself in abstraction (and thus acceptance). Paradoxically, the incomprehensible magnitude of Finance Capitalism's weapons of mass destruction can help obscure itself from scrutiny. Consider:
1) 97% of the world’s money is conjured up by private banks (the other 3% being cash printed by central banks), and here we are thinking "economics" works like balancing our personal budgets. As Varoufakis says, today’s power uses banks instead of tanks. 2) Financiers lend this mega debt (extracted from future productivity) to supposed capitalists to buy shares, who (instead of long-term investments, i.e. wait for company to profit and pay dividends) trade shares at a profit. This raises share prices, which encourages more lending to trade more shares (and fund mergers/acquisitions/takeovers). “Too big to fail” corporate cartels and mega banks feed off each other, combining to overwhelm market discipline and public virtue until this bubble detached from the real economy bursts (leading to golden parachutes, bailouts, mass unemployment, foreclosures, austerity, capital flight, etc.). “Bankruptocracy”, indeed… 3) While tens-of-millions die each year under global capitalism due to water/food/preventable diseases, unemployment building mega slums (Planet of Slums) and humanity/Earth’s ecosystems desperately needing investments for a green transition, today’s capitalism sits on a mountain of idle savings while refloating crashed corporate cartels/mega banks Ponzi-growth schemes and prolonging Fossil Capitalism: Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System). ...Where are the free, competitive markets to maximize the fulfillment of social needs? Is capitalist “innovation” (ex. complex debt instruments that hide risk) and “survival of the fittest” producing a virus infecting the planet and our social imaginations?
To free markets, we must abolish capitalism! --Before your head explodes with that sentence, a clarification: Classical political economists theorized the use of markets to free society from feudalism. Thus, they were interested in freeing the market from economic rent (interest-bearing usury, land rent, natural monopolies); see Michael Hudson. --Not only does today’s capitalism fail spectacularly in this, but the capitalist rhetoric of downsizing “the State” is a diversion. The side of the State where the public encroaches on (i.e. social services) will be slashed, but private banks/real estate giants (The Blackstone Group)/monopolies (extraction, Big Tech) will thrive as laws that protect their rent-seeking property rights get pushed further away from public scrutiny (ex. free trade deals with corporate tribunals). --Building on classical political economy's critiques of economic rent, Marx added exploitation of wage labor's surplus value which is appropriated directly by employers. Later traditions added imperialist rent (e.g. dependency theory) and financial uncertainty (Minsky/Kalecki/Keynes)... --So, exactly what about capitalism needs to be targeted, and how (the trillion dollar question after we’ve defined the problem)? The theme of Varoufakis' proposals is: a) Abolish capitalist property rights that protect rent-seeking markets. b) De-centralized (including market) mechanisms with democratic oversight, to prevent unnecessary centralized power/State bureaucracy. This can be seen as a transition towards mutual aid.
--Here are Varoufakis' top 4 targets:
1) Stock Market & Labor Market/Wage Labor Contract: --Despite the tidal waves of Finance Capitalism, it makes sense to start with the real economy of production and labor: a) Crisis: the capitalist property right of shareholding rewards absentee ownership (dividends from company profits), which is separate from work (wage income, including the waged roles of managers/supervisors). Major decision-making in corporations are dictated by one-share-one-vote, which the few wealthy absentee shareholders monopolize. --Since shares are tradable and liquid, this opens the door to speculation; share-price inflation Ponzi-growth schemes described above provide more short-term windfalls than long-term investments (waiting for the possibility of company profits, a portion of which is then distributed to shareholders quarterly as dividends). --Workers (via the wage labor contract between employers-and-employees) and communities are forever dependent on this corporate dictatorship, and are the first to suffer structural unemployment and capital flight from speculative crashes, automation, outsourcing, etc.
b) Solution: economic democracy: one-person, one-share, one-vote, abolishing the stock market and labor market (wage labor contract). --Only workers get a share in the company they work for, which is not tradable. --Varoufakis names anarcho-syndicalism (and his adaption to “corporate-syndicalism”), although there is shared support from Richard D. Wolff’s extrapolation of Marxism (Democracy at Work: A Cure for Capitalism). --Company funds are raised via personal accounts (employees and pooled funds, see below) with reference to a Social Worthiness Index voted on by regional citizen juries. For the unnatural history of corporations, from pooled partnerships to joint-stock to limited liability, set limits on social purpose/duration to corporate person-hood/social immunity, see: The Corporation: The Pathological Pursuit of Profit and Power
c) Strategy: coordinated pension fund (biggest pooled shareholders for corporations) strikes targeting the worst corporations by withholding pension contributions, to crash share prices, demand divestments by pension funds, and force corporate law to enshrine one-person, one-share, one-vote.
2) Private Banking: a) Crisis: we’ve gone over private bank’s magic of private money/debt creation out of thin air (withdrawn from the future in anticipation of future profits), how so-called investment banks infect the real economy (the cycle of debt instruments + tradable shares) generating seismic Ponzi-growth, and how the bubbles bursting derails entire communities/countries/generations of the working/poor. --In the West, we refer to the 1929 Great Crash and subsequent Great Depression that only ended with the creative destruction of WWII destroying capital and spawning the US Military Industrial Complex. Afterwards, banks were momentarily restricted (“financial repression”) until the US’s global plan (Bretton Woods) no longer was advantageous to the US empire (The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy). The US revived the banking genie by unleashing Wall Street (the undercurrent of Neoliberalism; Super Imperialism: The Origin and Fundamentals of U.S. World Dominance). --We also refer to the 2008 Financial Crisis and now the 2020 COVID shutdown. But financial crises have plagued capitalism since its inception, with modern ones reaching dizzying scale and abstraction.
b) Solution: abolish and replace with public banking --Each citizen gets a direct account (“Personal Capital”) with the central bank with 3 funds: i) Accumulation: basic pay + bonuses (transparent voting by co-workers) ii) Legacy: trust-fund for each baby iii) Dividend: universal proceeds from society’s capital, taxed from corporate revenues instead of from labor (unlike UBI). Speaking of taxes, there are only corporate and land taxes, no income/consumption taxes. --This central bank account bypasses private retail commercial banks for making money transactions/savings, and bypasses private investment banks for investing in companies (workers invest directly in companies via this account and by pooling funds). No share markets means no Ponzi-schemes for investment banks to fund. --Yes, current Central banks are not to be trusted (from 1970s money inflation that cut into wages to refloating criminal private banks), and there needs to be strong demands from below (see below) to democratize Central banks (esp. decision-making on creation of new money) and transparency on aggregate money transactions (to monitor suspicious money creation). More on transition to public banking and the democratization of money into a public utility: The Public Bank Solution: From Austerity to Prosperity
c) Strategy: while Varoufakis supports the initial momentum of Occupy Wall Street, he astutely critiques the limitations of occupying physical spaces when Finance capitalism operates digitally in the ebbs and flows of financial transactions. The target then becomes the fragility of Finance capitalism’s overly-complex (i.e. hides risk) debt instruments (i.e. CDOs, collateralized debt obligations) using “crowd shorting” --Since these debt instruments have infected the privatization of utilities (where utility payment debts have been presold to financiers, “securitized” into CDOs, then traded in global Finance), unpicking these CDOs and coordinating a short-term targeted payment strike on utility bills (telephone, water, electricity) can implode Finance capitalism’s Ponzi schemes, prevent central banks from refloating private banks, and force the creation of public banking. --With this activist push from below winning pubic banking policies, the public banking option can win over the masses stuck with the private bank system (interbank payment system, their joint database). Personal account with the central bank can be used to pay taxes, with initial 5% tax relief. Private banking’s fees (transaction, penalties)/middlemen parasitic bureaucracy/low interest can be avoided, while Legacy/Dividend funds provide further incentives. --I'm curious how demands for a targeted debt jubilee advocated by the likes of Michael Hudson and Graeber fits into this. Hudson stresses that on the other side of unpayable debts are the assets of the elite, so simultaneously wiping out both is crucial to contesting power: ...And Forgive Them Their Debts. --Apart from abolishing Finance's economic rents, Varoufakis also has a section on how to abolish capitalist land rent. As is the theme of the book, this also involves dismantling capitalist property rights while utilizing market mechanisms with democratic (instead of State bureaucratic) oversight.
3) Neocolonial Debt Bondage: a) Crisis: to summarize the context: the US empire’s post-WWII Bretton Woods plan to restrict Wall Street (“financial repression”) and regulate global monetary trade imbalances was built on the assumption that the US will remain the key surplus country. --The US lost its surplus by the late 60s from its endless military spending in genocidal wars against Korea and Vietnam. Bretton Woods (esp. dollar-gold convertibility) was officially dismantled by 1971 (Nixon Shock), as the US empire switched to dollar-debt imperialism: the US could maintain hegemony if it controlled the recycling of (now others’) surpluses (ex. petrodollar recycling). --Thus, Wall Street was deregulated again to attract foreign surpluses. Foreign central banks were forced to buy US Treasury bills (since no more gold convertibility, and to prevent competitive devaluation of the dollar for US exporters), which the US could freely print; in essence, foreign countries financed the US trade and budget deficits, a global tax. Super-imperialism: https://youtu.be/paUgY6SGlgY --US’s escalating deficit free-riding fed massive global imbalances (see Varoufakis’ And the Weak Suffer What They Must? Europe's Crisis and America's Economic Future), made only worse by Wall Street and IMF/World Bank. Speculative hot money flooded into new deficit regions (especially problematic in the Global South) creating debt-dependency, bubbles, and unaffordable asset-price inflation (esp. housing). When the bubble bursts and bankers walked away, dependent regions were forced to go to the IMF for debt bondage and austerity (ex. Third World Debt Crisis). -amazing intro: The Divide: A Brief Guide to Global Inequality and its Solutions -details: The Poorer Nations: A Possible History of the Global South
b) Solution: abolish and replace IMF/debt bondage with international ledger/discipline against imbalances with direct transfers: i) Create international currency/ledger (“Kosmos”, modeled after John Maynard Keynes’ proposal of “Bancor” that was shot down by the US empire in Bretton Woods) for trade accounting. ii) “Trade Imbalance Levy” to charge both sides in gross trade imbalances. iii) “Surge Funding Levy” to charge speculation to prevent money imbalances. iv) Both charges go to common fund for redistribution/development/green transition; this is a direct transfer and not a loan (IMF debt trap).
1) History of real-world capitalism: --I’ve heard this story elsewhere (fellow anthropologist David Graeber, those influenced by Fernand Braudel like Immanuel Wallerstein), and of course this is a messy topic with many inner debates, but this was a refreshing summary: capitalism did not “evolve” from feudalism in a linear, progressive manner. --Instead, European peasants had finally pushed back serfdom (assisted by labour shortages after the Black Death), leading to the “golden age of the European proletariat” (1350-1500) --Capitalism was a bloody backlash (1500-1800) to recover elite accumulation, with the Enclosures. As was New World colonialism (as opposed to the “discovery” myth).
2) Logic of real-world capitalism: --Marx’s M-C-M’ (Money invested into Commodity production for the goal of more Money) representing capitalist production's logic in contrast to pre-capitalist market exchange C-M-C (Commodity exchanged via Money for another Commodity). Thus, the capitalist logic is fundamentally about growing money. --Marx’s exchange-value (selling private commodity on market for profit) triumphing over use-value (intrinsic use). In particular, Commons have intrinsic value despite abundance, whereas capitalist exchange-value requires artificial scarcity (central in the commodification market-creation of the Enclosures/colonialism/Neoliberal globalization). --Even deeper, the ontology of the time was transformed to serve capitalist accumulation. Previous forms of animism (living Earth, nature as subjects) in European peasants and in indigenous colonies were stamped out with the dualism of early science (Bacon, Descartes; mind vs. body, nature as objects). ...This objectification facilitated extraction/commodification/privatization (property) of nature, as well as of labour (human body as machines… thus productivity and disciplining of labour). “Capitalist production, therefore, develops technology, and the combining together of various processes into a social whole, only by sapping the original sources of all wealth - the soil and the labourer.” -Marx, Capital: A Critique of Political Economy, Volume 1 --Hickel only later appends on money as debt, citing that more than 90% of money in circulation is loaned into existence by private banks via “fractional reserve banking” (banks only hold in reserves ~10%; the rest is conjured out of thin air) and the attached interest (esp. the infamous compound interest) that banks feast on is a deep driver of growth. If we bring back Marx, we get M-M’ (Money for more Money). “It is perhaps well enough that the people of the nation do not know or understand our banking and monetary system, for if they did I believe there would be a revolution before tomorrow morning.” -Henry Ford -Another Now: Dispatches from an Alternative Present -And the Weak Suffer What They Must? Europe's Crisis and America's Economic Future
3) Unpacking mainstream solutions: --The Green New Deal at its core targets the urgency of climate change (although the broader movement has many overlaps with steps in this book), while Hickel’s scope is broader (considering the 9 “planetary boundaries” of the Earth System, where climate change is but one boundary) and deeper (decolonization: systemic change, power considerations ex. Green New Deal mineral requirements targeting the Global South; must-read: A People’s Green New Deal). ...It's a relief that Hickel is well-versed on the actual histories/political economy of imperialism on the Global South (his previous book is The Divide: A Brief Guide to Global Inequality and its Solutions, after all), so he can synthesize Global North degrowth + Global South “de-linking” from imperialist intellectual property trade/debt. Here are the gems Hickels refers to: i) Political Economy: Utsa and Prabhat Patnaik: Capital and Imperialism: Theory, History, and the Present, The Agrarian Question in the Neoliberal Era: Primitive Accumulation and the Peasantry, etc. ii) History: Vijay Prashad: The Darker Nations: A People's History of the Third World, Washington Bullets: A History of the CIA, Coups, and Assassinations, etc. ...Related topics covered: i) Technocratic climate “solutions”: “decoupling” myth of more efficient processes meaning we can “dematerialize” economic growth vs. Jevons paradox where savings are reinvested to grow production (“efficiency” for what? ...under capitalism, it is to endlessly grow profits and survive competition); the delusional assumptions behind mainstream negative emissions technology (esp. BECCS), etc. ii) “Overpopulation”: I don't think we can stress enough how important the unequal distribution of per capita ecological footprint is here (see Too Many People?: Population, Immigration, and the Environmental Crisis and video); only after this is made clear should we then add that population growth is the one growth curve we know how to flatten in a socially-just manner, i.e. infant/women's health, reproductive rights, education, and of course overall improved living standards.
4) Building deeper solutions: reversing the logic (degrowth as decolonization): --Perhaps the greatest problem with “degrowth” is the one-word label has a lot of baggage and confuses even those who should know better: i) Liberal technocracy baggage: “degrowth” is close to the “Limits to Growth” MIT technocrats of the 1970's, who combined useful systems science (which eventually evolved into Earth System Science) with reductionist “overpopulation” analyses mentioned above. ii) Economic Growth: perhaps more concerning for me is how even obvious allies like progressive economist Robert Pollin and anarcho-syndicalist Noam Chomsky counter with “well, we obviously need some green growth in renewables” in The Climate Crisis and the Global Green New Deal: The Political Economy of Saving the Planet. This completely misses the point that “degrowth” is targeting overall economic growth (GDP)/ecological footprint! Of course we want to “grow” services for social needs, but economic growth (measuring instantaneous market exchange, which must continue to grow to return profits) is a perverse measure that rewards waste (requires growing re-purchases: single-use, planned obsolescence, advertising social addiction): see the excellent Gone Tomorrow: The Hidden Life of Garbage. ...Even when Pollin considers “degrowth” of GDP, his progressive reformism barely registers as he compares this with economic crises which also “degrow” GDP! Who needs reactionary conservatives?! The amount of fetishization for an abstract macroeconomic measure rather than directly considering social health measures is appalling. We are not talking about basic accounting here; this is pure ideology! --While Hickel does go over the issues with GDP (created during WWII to maximize war production, no accounting of costs or non-market goods, then enshrined as the universal target of “economic growth”), the crucial next step is exploring the strong coupling between (1) GDP growth and (2) raw materials consumption/ecological footprint which exploded with the “Great Acceleration” after WWII and no end in sight despite the supposed “Information Age”/“Intangible Economy”. Key in this is compound growth (exponential, not linear). ...I'd like to synthesize this with Michael Hudson's focus on Finance Capitalism's debt overhead (the aforementioned M-M’) and fictitious speculative growth (as opposed to industrial growth and its material use): The Bubble and Beyond. Hudson portrays "Industrial capitalism" being cannibalized by "Finance capitalism", which might sound like less raw materials use! One common ground is that high debt overhead forces more work to simply pay off the debts, thus more resource use. ...Indeed, as the magic of capitalism is driven by the abstract force of debt (see the "Great Reversal" in Talking to My Daughter About the Economy: or, How Capitalism Works—and How It Fails, where capitalism's finance-production-distribution starts with the debt of capital investments, whereas prior economies were production-distribution-finance), needlessly forcing workers and industrial capitalists to exhaust the planet just to pay off parasitic debts to the various layers of creditors (the worst being institutional absentee speculators/rentiers... i.e. rent-seeking/passive income/Ponzi schemes). Insanity. -Killing the Host: How Financial Parasites and Debt Bondage Destroy the Global Economy ...Thus, we need to pair i) Debt cancellations: Debt: The First 5,000 Years i) Degrowth of bullshit jobs required merely to pay off parasitic debts: Bullshit Jobs: A Theory ...so we can spend our precious time on earth with loved ones and rebuilding communities/ecologies; this is a crucial framing that Hickel should emphasize more. --To reverse capitalism’s logic, the ontological change is to dismantle the dualism, to move from dominion to reciprocity. The interconnectivity of systems science has been the new paradigm in the physical sciences, from the human microbiome (The Human Superorganism: How the Microbiome Is Revolutionizing the Pursuit of a Healthy Life) to Earth Systems science (Facing the Anthropocene: Fossil Capitalism and the Crisis of the Earth System). In critical economics: The New Economics: A Manifesto --Our fears of needing more to achieve a “good life” is contrasted with the actual measures of wellness. Historically, this has not been from working to death/destroying our surroundings but from the creation of new Commons: public sanitation, public healthcare, public education, public housing/land reforms, improved working conditions, socialized safety nets/old age pensions/childcare, etc. (Perilous Passage: Mankind and the Global Ascendancy of Capital). …Thus, degrowth is the transformation from artificial scarcity to radical abundance. --Update: after reading a couple direct attacks on degrowth/Hickel's book, I re-read Hickel book and unpacked the critiques in reviewing Less Sucks: Overpopulation, Eugenics, and Degrowth....more