Showing posts with label crisis. Show all posts
Showing posts with label crisis. Show all posts

Friday, May 15, 2009

Markets and the State

The latest issue of New Left Review is really worth checking out. It has Zizek on Left strategy (on which Lenin has a good commentary), Wallerstein with reflections on Fanon, a really interesting looking article about imperialism and art history in China, and a good piece from Leo Panitch about the roots of the crisis. Here's an extended quote from the latter.

Financialization functioned in a number of different ways to drive forward the American-imperial expansionism of the 1990s and early 2000s. The development of securitized markets and the internationalization of American finance provided risk-insurance in a complex global economy, without which accumulation would have been significantly restricted. In addition, the global predominance of us financial institutions helped to mobilize cheap international credit for the American economy and so sustained its role as the world’s prime consumer, even as us capital flowed out in the form of fdi and military expenditures. The dollar served as the key store of value and medium of exchange, while us Treasury bonds became the standard for the calculation of value in the world economy at large. As we shall see, financialization also played a vital domestic role, both by integrating subordinate classes into a web of financial relations through private pensions, consumer credit and mortgages, and through facilitating consumer demand in an era of stagnating wages and limitations on the welfare state.

But for all the functionality of financialization for imperial power, it also brought new contradictions. While asset inflation was considerably more in line with the purposes of American capital than the consumer-price inflation of the previous decades, it was also a deeply uneven process that was responsible for enormous volatility. The emergence and bursting of financial bubbles became a common feature of the system, and successful state interventions to contain them reinforced the notion that future bubbles could be managed. Washington’s highly pro-active role in containing domestic and international financial crises from the 1980s on was perhaps the most concrete demonstration that the alleged withdrawal of states from markets was an ideological illusion. If neoliberal policies engendered a great deal of financial activity, the effect of this was not to subordinate state capacities to market forces but rather to make political interventions all the more necessary—not least in fighting fires sparked by financial volatility—as well as more feasible. Financialization enlarged the American state’s role both directly and multilaterally, even as it extended the strategic leeway available to capital. The result was the step-by-step construction of a too-big-to-fail regime, whereby intermediaries that were so large and interconnected that their failure would bring down a significant part of the system could count on the us state, and especially the Treasury, to come to the rescue.

The repeated economic interventions of the American state, while driven by the exigencies of the moment, were never as incidental or exceptional as they were often portrayed. On the contrary, they were part and parcel of the distinctive policy practices of the neoliberal era. Both the Fed and the Treasury, faced with constant financial volatility and intermittent crises, developed a range of institutional capacities to cope with this. But such institutional capacities should not be seen as standing above the financial world that they regulated; rather, they were embroiled in its contradictions. The increasingly enhanced role of the state, including the discriminatory practice of showering liquidity on crisis-hit banks in the North while imposing discipline and austerity in the global South, built up ‘moral hazard’ even as it generated financial innovation and expansion. Although too-big-to-fail policies are often portrayed as a last resort, indicative of neoliberalism’s essential lack of coherence, instances when the us government led the way by stepping in to contain financial crises were hardly exceptions to the rule. In that sense, the massive interventions by the Bush and Obama Administrations in the course of the current crisis are merely the culmination of the long series of interventions that marked the neoliberal era.

Monday, April 20, 2009

Report from the Left Forum

Yesterday I managed to crawl out from the book cave otherwise known as my apartment to spend the day at the Left Forum in New York. The Left Forum, for those of you who don't know, is a huge academic/activist conference held every year in the city. It's absolutely massive, with the leading lights from the national and international left presenting. While I've heard that it's been different in previous years, this year there was a strong youth activist presence that balanced out the old balding white guys nicely.

I managed to get to three of the seemingly numberless panels: David Harvey, Doug Henwood, Nomi Prinz, and Fred Moseley's "Nationalize the Banks! What Does it Mean?", Richard Seymour (aka Lenin), Samuel Moyn, and John McArthur's "Liberalism and Human Rights," and Adolph Reed, Jr., and Walter Benn Michaels' "Diversity in the Age of Obama." The first two were excellent, the last was a travesty.

The presentations on banking were extremely interesting. Doug Henwood began by noting that two years ago if the Left Forum had a panel on banking, very few people would have showed up (there were approximately 250 yesterday). He proceeded to argue that, contrary to common sense, booms are often more conducive to radicalism than busts. The antiglobalization movement came after four years of job creation in the 90s, the 60s came on the tail-end of the postwar boom, etc. At the same time, the crisis of the 1970s failed to produce any major radicalization in the US.

Therefore, given the weakness of the Left in this crisis, Henwood argued that we should be putting forth a minimalist program based on nationalizing finance, bringing it under more democratic control, and channeling credit towards more socially responsible projects like affordable housing and green energy. While it's obviously good to argue that crises don't automatically produce radicalization, I think Henwood misses the dynamic in which this crisis, combined with the discrediting of conservatism by the Bush regime, actually is producing a major shift to the Left right now. If we're to have any long term persuasiveness in giving this shift organized form and expression, we need to do more than articulate a minimalist program and talk seriously about our long-term goals for changing society altogether.

Fred Moseley, an exceptional Marxist economist, largely agreed with Henwood. He argued that the demand for a bailout should be used as an argument against capitalism, as it demonstrated both that the system is inherently unstable and that when it does collapse it places the burden on ordinary taxpayers. Somewhat incongruously, he hitched this rather large-scale argument to Henwood's assertion that the Left should busy itself at the moment with articulating a minimalist program based around the democratization of finance.

Nomi Prins, who I hadn't heard of before, provided a somewhat refreshing counterweight to Henwood and Moseley. She delivered an angry presentation about the bankruptcy of the concept of "too big to fail." Interestingly, she argued that the state shouldn't nationalize institutions like AIG, but instead work on breaking them up.

David Harvey went last, and basically delivered a polemic against his fellow presenters. He began by noting that "Economics is a discipline that is dominated by people who have no idea what the fuck is going on." He then went on to argue that it was foolish to talk about "speculation" as a bad activity or to separate finance from the "real economy." Speculation and finance have played a crucial role in capital's development since its beginning, and it couldn't exist without them. Therefore, any move towards addressing the financial crisis would have to come to terms with its role in capitalism. He also argued that there's always been a "state-finance nexus," but that it has undergone multiple revolutions since its establishment, from the gold standard to neoliberalism. With this emphasis on the long term tendencies of capitalist development, Harvey described crises such as the current one as "irrational rationalizers of an irrational system," a brilliant description in my opinion.

The forum then opened t Q&A, but I left when six people wearing Revolution t-shirts bum rushed the mics all at once. Seriously RCP, you give the rest of us a bad name.

I had been looking forward to the next session for some time, having been a big fan of Richard Seymour's writing for some time now. The first presenter, however, gave Seymour a hard act to follow. I hadn't heard of Samuel Moyn before yesterday, but his presentation made it clear that he's one of the best people out there currently thinking about rights discourse, imperialism, and capitalism. Moyn argues that appeals to rights are divided by a fundamental discontinuity between human rights and the rights of man. The latter, arising out of the crucible of the American and French revolutions, were always articulated in an appeal to sovereignty and nationality. Despite this entwinement with some rather nasty formations, insurgent movements, such as the Black Jacobins of Haiti, were able to use the Rights of Man as a framework with which to push some very progressive things. The shift to human rights, in the aftermath of WWII (though crucially, not originally a response to the Holocaust), severed rights from an appeal to a specific polity to the supposedly more universal "human rights." The early codification of human rights in the Universal Declaration of Human Rights, while including a number of economic and social rights which are often elided today, crucially lacked any discussion of self-determination. In the context of decolonization, this was not an innocent silence. Moyn went on to argue that appeals to human rights have more often than not been an excuse to violate a given nation's sovereignty (Serbia, Afghanistan, Iraq, etc etc). Thus human rights, while supposedly more universal, have often played a more reactionary role than the rights of man.

Seymour gave an excellent presentation on the history of liberalism's relationship with empire, interspersing it with the great jabs at pro-war leftists anyone who reads the Tomb knows and loves. Since I've read his book and read the Tomb religiously, there wasn't much new for me in his prepared remarks. He closed, however, with a compelling argument that a renewal of Marxism is absolutely necessary if liberal interventionism is to be combated. Simply put, no other framework/movement has been able to combine a militant insistence on self-determination with a broader program of human emancipation. Fabianism lacked the former, while anticolonial movements too often papered over the latter.

John McArthur's presentation was what one would expect from the publisher of Harpers. Lots of really interesting anecdotes that don't necessarily add up to anything convincing. In the discussion, McArthur tipped his hand and argued that he thinks foreign policy is almost wholey determined by domestic politics, an analytically worthless argument that reveals nothing so much as McArthur's demoralization.

I would take McArthur's resignation anyday, however, over the next panel. Adolph Reed is a smart historian and political commentator. His writings on Du Bois, the Black academy, and contemporary politics are sharp and deserve wider reading. He has hitched himself to a rather shoddy star, however, in Walter Benn Michaels. WBM is the author of a book called "The Trouble With Diversity: How We Learned to Love Identity and Forget About Inequality." A promising title, no? Unfortunately, it's little more than a screed that argues that antiracism is a right wing, neoliberal politics. WBM makes this argument by arguing that people who talk about racial disparities in things like income imply that if proportionate numbers of Blacks and whites were in the various income quintiles, that everything would be fine. This, of course, leaves class inequality itself untouched. Therefore, it's neoliberal to talk about racial disparities in income. Any questions?

Of course, WBM's argument is little more than sleight of hand. For one thing, it's hardly impossible to argue that it would be better if the lowest income brackets weren't stuffed with people of color and that we should abolish class society. For another, the argument presumes that the only serious way to talk about racism is to talk about income distribution (a curious proposition in the age of Sean Bell, Adolph Grimes, and Oscar Grant). WBM argued that such blatant bigotry is no longer the rule, and Reed rather cavalierly dismissed the importance of such events.

During the Q&A, I asked what the speakers thought the left attitude towards Islamophobia should be. Since Islamophobia is a major justification for US capital's designs on the middle east, and since it helps to bind US workers to US capital by convincing them that their major enemy is scary Moslems, it seems to me that it's fairly self-evident that a politics of antiracism around Islamophobia is hardly neoliberal. Adolph Reed responded by assuring me of his personal abhorrence of Islamophobia, and then moving on to another subject. WBM, in an evasion charming for its naivete, responded by saying that Obama, raised by a Muslim, obviously wasn't an Islamophobe, and that neoliberals wanted to see more Muslims in the billionaire's club. As if Obama needed a personal fear of Muslims to promote racism against them.

WBM's ideas are nothing less than poison to the worker's movement. I used to think that academic accusations that the left doesn't want to talk about racism were based in little more than caricature and fantasy. Unfortunately, this panel proved me wrong. Apparently there are some walking fossils who think that Eugene Debs was right to say that the Socialist Party has nothing to offer Black folks.

All in all, though, the forum was a huge success. It brought the best of the academic left into contact with some of the most vibrant young activists in the city. If the seriousness with which people were grappling with theories and strategies is any indication, the US Left is laying the foundations for some major growth.

Wednesday, October 29, 2008

Halloween: Capitalist Horrorshow edition of the International Socialist Review



It's spooky.

REPORTS AND ANALYSIS

LANCE SELFA: A new political landscape

LEE SUSTAR: An Economic system on the edge

EDUARDO LUCITA: A crisis of capital

Battle at Boeing

FEATURES

Racial scapegoats for the crash
Conservatives are blaming the economic crisis on affirmative action, Phil Gasper writes in “Critical Thinking”

Capitalism’s worst crisis since the 1930s
Joel Geier

Beyond the surge in Iraq
Ashley Smith looks behind the hype about success in Iraq

Afghanistan: The new quagmire
Christian Parenti, interviewed by Helen Scott

Bolivia after the referendum
Jeffery Webber and Tom Lewis

Charter schools and the attack on public education
Sarah Knopp

Hothouse Earth: capitalism and climate change
First of two articles by Chris Williams

The echo effect of 1968
Mexican author Paco Ignacio Taibo II, interviewed by Todd Chretien

Energy imperialism
Lance Selfa reviews new books by Michael T. Klare and Andrew J. Bacevich

A life spent in struggle
Todd Chretien remembers Peter Miguel Camejo, 1939–2008

REVIEWS

What to read about Afghanistan
Charles T. Peterson reviews five recent books

PLUS: Hooked on prescription drugs; Deadly lines on the map; Overblowing the risks of terror attack