Profits of Doom: Spectres of Capitalist Crisis

Article excerpt

Smith, Murray E. G., Global Capitalism in Crisis: Karl Marx and the Decay of the Profit System (Halifax and Winnipeg: Fernwood 2010)

Albo, Greg, Sam Gindin, and Leo Panitch, In and Out of Crisis: The Global Financial Meltdown and Left Alternatives (Oakland, California: PM Press/ Halifax and Winnipeg: Fernwood 2010)

Michael A. Lebowitz, The Socialist Alternative: Real Human Development (New York: Monthly Review Press 2010)

"A SPECTRE IS HAUNTING EUROPE," wrote Marx and Engels in 1848, "the spectre of Communism." A century and a half later the spectre, according to much conservative ballyhoo, had been vanquished. In 1989, as the Berlin Wall fell and "actually existing socialism" imploded throughout the Soviet Bloc, Francis Fukuyama declared "the end of history."

This premature triumphalism celebrated what seemed the ultimate victory of the American Empire over its Cold War superpower rival, the Soviet Union. Liberal capitalism had finally, after decades of nuclear arms stockpiling, Sputnik space races, and routinized skirmishing over battlegrounds such as Cuba, Vietnam, Afghanistan, and the Middle East, won its war with what passed in many circles for communism. History, as it had been known for much of the 20th century, had been transcended. The good life was now assured. Or so went the story, and many were sticking to it.

The good was not to come without the bad. In less than two decades, and with no evil enemy of totalitarian communism to point the finger of blame at menacingly, capitalism ascendant was reduced to capitalism in crisis. From 1990 to 2007, the free market world was rocked by crisis after crisis. In 19941995 the Peso Crisis in Mexico necessitated a $50 billion bailout involving the International Monetary Fund, the United States government, and the Bank of Canada. The collapse of the Asian Tigers in 1997-1998 saw Far East currencies plummet in value by 25 per cent on a single day. In the United States, dot.com and 9/11-induced stock market crashes devalued Wall Street portfolios dramatically in 2000-2001. But it was the subprime mortgage meltdown of the summer of 2007 that registered with unambiguous finality that capitalism was indeed in crisis mode. It cut a swath of foreclosures, plummeting stock prices, unemployment, and corporate bankruptcies through capitalism's hedged ideological facade. In its aftermath capitalism had, for a brief moment, an exceedingly bad press: sordid tales of corruption and greed circulated through the media; brazen multi-millionaire CEO's became the bad boys of the hour, their arrogance and assumptions of limitless entitlement offending populist sensibilities.

This latter crisis, the reverberations of which continue to this day, forced the hand of the United States government. For decades the reigning capitalist ideology had assailed 'big government' intervention in the sacrosanct market, although, of course, the American state had been wielding its influence in decisive ways, not only domestically, but also around the world. The free market, however, had clearly failed. It needed a massive infusion of cash, as both Republicans and Democrats agreed. Failing financial institutions by the dozens and bankrupt private sector giants such as General Motors became suddenly dependent on an unprecedented US taxpayer-funded bailout. Not only was Wall Street given a reprieve and Detroit brought back from the brink, the United States Federal Reserve shored up banking systems around the world. As went the US, so went Canada: Oshawa's automobile industry (and retired workers' pensions) was saved by Ottawa and Queen's Park.

We live in the shadow of this 2007 meltdown. The spring 2010 collapse of the economy of Greece, and the likelihood of similar European Union catastrophes in Spain, Portugal, and Italy are reminders of this. They may seem far away, but in our current world economic village, the fall of a European economy cannot but be felt immediately on all the planet's continents, however varied their Main Streets. …