Maksakovsky – The Capitalist Cycle

I still intend to write a proper review and explanation of why it is really important to study this short book, together with more recommendations for preliminary reading.

Meanwhile there is a sale ending August 23 for hardcopy paperback at $10 half price so here are the details to order RIGHT NOW.

https://www.haymarketbooks.org/books/278-the-capitalist-cycle

Amazon and Book Depository are quoting over 4 times that so get 4 copies NOW.

Seriously, also get some extra copies for future distribution to others. This book is REALLY important.

Foĺlowing is from front page of my still unopened blog.

“The Capitalist Cycle: An Essay on the Marxist Theory of the Cycle by Pavel V. Maksakovsky is also available in paperback for AUD $27.06 with free delivery. Available till 2018-08-23 for USD $10 plus shipping in half-price sale of all Haymarket books.

This site is mainly for my notes on why it is important to study this book and how to do so as well as developing the theory generally. Collaborators are welcome.

Many references to related books and papers linked from here, including the above, are for free “one-click, no registration required” downloads from Library Genesis. Naturally that is blocked by internet censorship in some countries. For details on how to gain access when blocked, click that link.

Recommendations for reading:

Postpone the long translator’s introduction until after finishing at least chapter 2 of Maksakovsky’s own work.

Short Foreword and author’s introdction are only 11 pages so much better than long translator’s introduction for a quick look immediately to decide when to read the rest.

Chapter 1 is 34pp and confirms this is not “the usual” one gets from “Marxians” nor Soviet dogmatism. Worth reading next.

The core of Maksakovsky’s theory is Chapter 2 only another 57pp. That covers the “real” side. If those 102 pages don’t interest you the rest probably won’t either. But he only deals with “The Role of Credit” in Chapter 3 on the basis of first having dealt with the underlying “real” cycle that is “amplified” by credit.

Further help with suggestions for preliminary reading will be provided when this site is ready for public use but it won’t be ready for a while. Meanwhile the blog posts available from “Blog” link are just notes to myself with no navigation structure but I can be contacted by leaving comments.

A Genuine Left Would Support Western Civilisation – by David McMullen

First published at On Line Opinion

… western civilisation is no longer western. It is global and a far better term is modernity. By the end of this century we can expect it to have totally supplanted all pre-existing conditions, even in the most backward regions. This will be a jolly good thing too.

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The pseudo-left wants to stop a multi-million-dollar donation by the conservative Ramsay Centre for Western Civilisation to the Australian National University for a new course on Western civilisation. According to the heads of the staff and student unions at the university it is racist to prioritize western history or culture. It mustn’t be “privileged”.

I guess we are supposed to look back lovingly at all those civilisations that crumbled in the face of the western onslaught, for example, Czarist Russia, Qing China, Mughal India, Ottoman MENA and Aztec Mesoamerica. And then of course there were the remnants of hunter-gathering society that lived in harmony with nature, and from whom we can learn so much, so we are told.

Of course, western civilisation is no longer western. It is global and a far better term is modernity. By the end of this century we can expect it to have totally supplanted all pre-existing conditions, even in the most backward regions. This will be a jolly good thing too.

Western history should indeed be prioritized over other history because that is where modernity began. The history of other regions is still important, but mainly in order to understand how their traditional cultures are an obstacle to modernity.

By studying western history, we get to understand how the connection between the economic, social and political transform the way be live.

The collapse of the Roman Empire is a good place to start. That’s when things slowly began to get interesting. Under the dead hand of Rome, innovation had been forbidden or a matter of indifference. But with the “Dark Ages” came something of a technological revolution in comparison. For the first time we saw the harnessing of horse-power with the adoption of the saddle, stirrups, horse shoes, bridle, horse collar and tandem harness. Water and wind mills sprang up everywhere.  The cranks and gears used in mills would become the basis of modern machinery. Lock gates in rivers and streams appeared for the first time. There were ships that could sail into the wind. And in the meantime, the church was doing a good job preserving literacy for a later time when it could be put to good use.

We gradually saw the spread of the market. This was assisted by the political fragmentation of Europe where the local thugs (sorry, lords) did not have their own raw materials for weapons and finery, and also of course by the development of ocean going sailing ships.

However, the feudal conditions became a fetter that could only be broken by the development of capitalist property relations. Small scale production could not meet the demand of the growing markets. Production carried out with the cooperation of large numbers of workers using machinery replaced small scale individual production. Steam power for machines and locomotion replaced wind and water.

This new economic system was compatible with, indeed required, more freedom of thought and action by the individual. A totally new society sprung up.

Studying the emergence of the modern world also gives an appreciation of how progress can be a messy thing.

When Martin Luther undermined a pillar of the feudal order, the Catholic Church, the achievement did not come cheaply. Notably, the subsequent religious wars killed off a quarter or more of the population of central Europe and half the male population of Germany.  About the same time, we had The English Civil War. This was critical to the creation of modern Britain but was a protracted bloodbath and lead to the death of 40 percent of the population of Ireland. Then it took a century of mucking about for the French Revolution to replace the old feudal regime with a respectable bourgeois one.

And nearer to the present we have seen the rocky road out of feudalism achieved in the former Czarist empire, China and eastern Europe. In the 1940s, we had to resist fascism’s attempt to roll back history, and that struggle cost millions of lives. So, if you think change seems pretty messy in the Middle East at the moment just look back at modern history.

The Ramsay Centre for Western Civilisation will of course want modernity to stop at capitalism. They are aptly called conservative. In their view, not only are capitalist property relations superior to older forms but attempts to move beyond them are bound to be a tragic folly. Exhibit one is the failed attempts in the 20th century to create post-capitalist societies on the back of totally unsuitable pre-capitalist conditions. Exhibit two is the doubtful results of “socialist” tinkering under capitalism. That sort of evidence would not get past a committal hearing but it has wide acceptance.

We then have the revolutionary wing of western civilisation that I belong to. Modernity in its preliminary capitalist form is a vast advance on everything else past or present and lays the conditions for the next stage. We should welcome its global spread.

In a letter to Engels of October 8 1858 Marx wrote: “The proper task of bourgeois society is the creation of the world market, at least in outline, and of the production based on that market. Since the world is round, the colonisation of California and Australia and the opening up of China and Japan would seem to have completed this process.” He was being rather optimistic but his point of view is clear. And notice the reference to Australia. No black armband there. (You may like to check out more Marx at the Marx Engels Archive.)

While capitalism is an advance it is still the exploitation of the many by the few.  But as luck would have it capitalism is an incubator of the next stage, a classless society based on social ownership of the means of production. Capitalism turns most people into workers with no vested interest in capitalism; it unshackles our brains from pre-capitalist, traditional junk; and it creates a level of economic development that makes it possible to imagine equality because it would no longer be a case of sharing want and toil.

We can expect a messy transition. To start with those who want change will be confused about what they want and how to get there while those opposed to change will have a very clear idea on both counts and years of practice. But let’s hope the transition is not as tortuous as the transition from feudalism to capitalism.

However, that is for the future. At the moment there is no revolutionary movement nor any support for revolution. For now, fully entrenching and advancing the present capitalist stage of modernity is the priority. There are still large regions of the world where backwardness and tyranny reign supreme.  MENA is a priority area from the point of view of lifting tyranny from people’s backs. Then in the long hall we have Sub-Saharan Africa. It is the most backward region and has a huge and growing population. Possibly a third of people will live there by century’s end.

Unfortunately, there seems to be an alignment of toxic trends hampering this process. In the US and Europe, “both sides of politics” are heavily infected by isolationism and protectionism. Europe has its disgraceful agricultural policy that adds to Africa’s misery and a limited ability to project military power.  Then we had Obama’s appalling failure to stay the course in Iraq and to intervene in a timely fashion in Syria.

And now nobody is denouncing Trump’s failure to do the right thing and occupy Syria while arranging regime change. Doing nothing is a policy fully endorsed by both the pseudo-left and the alt-right. The former all supported Saddam and now some even support Assad.

The pseudos have also built a whole movement over the last 20 years or so opposing the global spread of capitalism. And even more insidiously, they oppose economic development because it is “unsustainable”. They want the darkies to live in noble simplicity.

To get down to brass tacks, a genuine left would align itself with the neo-cons and support their re-emergence. They stand for an activist foreign policy of regime change, nation building and economic development. There needs to be military support for change where it has a chance of success. (It is worth noting here that the recent Iraqi elections have been surprisingly open notwithstanding the violent efforts of Baathists and Islamo-fascists.)  Diplomacy should be heavily focused on giving kleptocrats and tyrants a hard time.

Australia could play a special role given the failure of the Americans and Europeans. We can pressure them to act and take a much more activist military policy. Being a pipsqueak power, our contribution is limited. However, we can be good at training and deploying special forces.

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David McMullen lives in Melbourne and he can be found at The Communist Manifesto Project.

 

 

 

“Factfulness”

Just finished this book and VERY strongly recommend it.

First do this quiz is at the main site for the book (with lots of other very useful material):
http://forms.gapminder.org/s3/test-2018

Do above first for quick preview without spoilers. Numerous surveys done with this quiz. Consistently show that most people including most “experts” do worse on choosing between 3 plausible answers to basic factual questions about the world than random one out of three guesses of “Chimpanzees”.

Continue reading

Are property rights essential to prosperity and liberty? The ‘No’ case.

This is a presentation by socialist economist David McMullen at a Melbourne Argument debate at the Royal Oak Hotel, North Fitzroy, Melbourne, on February 8, 2017. His opponent was Ted Lapkin, a former adviser in the Abbott government.

Private Property Rights are Essential not only to Economic Prosperity but to Political Liberty – The No Case

February 12, 2017 via Different Wavelength

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When looking at economic prosperity and political liberty, the private property rights we are concerned about are the ownership rights of the capitalist class over the means of production or productive assets. We are not arguing about private property rights over items of consumption. So I acknowledge everyone’s right to their own toothbrush.

What I want to contend is that in the future we will get by very nicely without private ownership of the means of production. We will do this by creating a class free society where the means of production are socially rather than privately owned. This will free the economy of the many shackles placed on it by capitalism and at the same time create a society that requires the fullest political freedom for its proper functioning.This future system is generally referred to as communism.

OK why do I take this singularly unpopular position which everyone knows has been totally discredited? Well, I subscribe to the Marxist view that capitalism creates the conditions for this new more advanced system.In a nutshell, capitalism eliminates the need for the profit motive and hence the need for its own existence. It does this through the creation of modern industry and technology which open up the prospect of universal prosperity, and of robots and computers doing all the work that we really don’t want to do. Under these new conditions we can begin to imagine people working because they like what they are doing and they want to contribute, while at the same time being happy with an equal share of an increasing level of prosperity. In other words we can see social ownership having a totally different and better form of motivation than the profit motive that is associated with private ownership.

This means that what was previously impossible becomes possible.Past history already tells us that sharing poverty and laborious work is impossible. You cannot create equality under those conditions. It is a utopian dream. For example, as the Middle Ages illustrate it only requires a small band of thugs who would prefer to live off everybody else’s hard work and you end up with a very nasty class society. Also when assessing the experience of the Soviet Union, and the various regimes derived from it, it is important to keep in mind their backward economic conditions as a factor in determining how things turned out there.

Now, favorable economic conditions presently only exist in the rich countries where less than 20 per cent of the world’s people reside. What about the rest of the world? It looks like it is going to take a number of generations for them to develop. It is hard to be any more definite than that. However, I would suggest that the prospects are best if there is a healthy global economy and a willingness to provide well directed economic aid and also to offer diplomatic and military assistance to those resisting the forces of tyranny and corruption.

Anyway, why do I consider that social ownership will bring greater economic prosperity and progress? There are five reasons that strike me as being particularly important.

  1. Firstly capitalist firms cannot match the work performance that would be achieved where workers unprompted want to do the job to the best of their ability.Capitalist firms have to apply various rewards and penalties to get their employees to do their bidding. However, if a job is in any way complex it becomes difficult to correctly assess how well people are doing their job. And jobs are becoming increasingly complex so this is becoming more and more of a problem.
  2. Secondly once we get rid of private ownership and private debt we will also get rid of economic crises, stock market crashes, bank collapses and extended periods of depressions or recessions that lead to unemployment and reduced production.
  3. Thirdly we will get rid of the waste of human labor that Marx called pauperization where a large number of people are thrown on the scrap heap and survive on welfare. They are not equipped to develop work skills or they are psychologically maimed from living in this society.
  4. Fourthly, we will not have capitalism’s sluggishness in terms of what are arguably the main drivers of economic progress, namely,science, research and development, and technological innovation. There are a number of reasons for capitalism’s lack of vigor in this area. If I can beg your indulgence I will list six that I am aware of. Firstly, capitalists are not interested in major technological breakthroughs that will make their present investments less valuable or even obsolete. They just want incremental improvements that increase their value. Secondly, benefits from spending on R&D are long term but capitalists tend to have a short term perspective. Thirdly because of the public good nature of new knowledge, firms cannot capture all the benefits and so underspend on it. Fourthly, where intellectual property right laws are applied, access to knowledge is restricted. Fifthly, government funding for R&D is the first thing to go when there are government budget cuts. And also there is huge wastage as researchers game the funding system and personal prestige and career take precedence over outcomes. And sixthly, capitalism generates an anti-technology and anti-science attitude among the alienated masses. People see the modern industry created by capitalism as the problem rather than capitalism itself. We have people whose livelihood is threatened by new technologies. And there are the greenies who have a romantic view of the pre-industrial past.
  5. Now the last but by no means least on my list of capitalism’s economic problems that will be overcome under communism is what economists like to call government failure.Capitalism tolerates a lot of bureaucracy and regulation.Much of it is devoted to catering to the needs of vested interests in ways that harm the economy. Vested interest is just another term for private property. And as well as this there is of course empire building by career minded bureaucrats.

OK those are my arguments for why I think that private ownership of the means of production is a fetter on the economy. Now I want to address what I think are the two main arguments against what I’ve been saying. Firstly, we are told that social ownership would require excessive centralization and secondly that you can’t change human nature.

Economists argue that all this well-intentioned motivation would come to very little because an economy based on social ownership has an inherent economic calculation problem: in the absence of market transactions between enterprises it could not have a properly functioning price system. And as a consequence social ownership would require clumsy centralized resource allocation of the kind that existed in the Soviet Union. I am not going to speculate on how economic decisions will be made in the future under communism. However, we can say that there is nothing about the non-market transfers of custody over components from producer to user enterprises that would prevent them from making decentralized decisions based on prices. Furthermore, we could hardly do a worse job of allocating investment funds than do highly fluctuating interest rates and exchange rates produced by capitalist finance. Indeed, there are good reasons for thinking that economic decision-making would be far superior to that under capitalism. To begin with, because of the absence of ownership barriers, there would be far more scope for coordination, and less scope for secrecy and deception.

Human nature and mutual regard

Now what about human nature? A society based on social ownership requires far more than simply state ownership, although that is a prerequisite. There need to fundamental changes in people’s behavior and abilities.

The behavior change can be best summed up in the expression ‘mutual regard’.You do the right thing because you want to contribute and you know that your efforts are not futile because a large and increasing section of society is doing likewise. As well as being the basis of morality and what is considered honorable it is also enlightened self-interest. By everybody serving others we are all served. This altruism is not the self-denial that Ayn Rand made it out to be.

Many would doubt the ability of rank and file workers to do the complex kinds of work required in the future. However, I would suggest that people have greatly untapped potential. There are many ways that they are presently held back or find themselves unchallenged.

The kinds of changes we are talking about here will not happen overnight. There will have to be a transition period that will take a generation or more and is generally referred to as socialism. It will take time to totally eliminate private ownership, starting with the big fish, and it will take time to move completely away from the old capitalist work incentives. And it won’t be smooth sailing. Good behavior will only win out once the good majority gain the confidence and moral courage to stand up to those who behave badly. And there will be lots of old management types trying to run things in the old way and convincing workers that the new ways are futile. So it will be touch and go for a while and we may need more than one stab at it.

Now let’s look at political liberty

With the emergence of capitalism we have seen for the first time a degree of political liberty. We have constitutions limiting the power of government, we have elections, the separation of powers, habeas corpus. These would have been unimaginable in the Middle Ages or in any other pre-capitalist society.

The main problem however is that the capitalist system tends to abandon political liberty in times of crisis. Also a big test of political freedom is our freedom to confiscate the means of production from the capitalists and convert them into social property. In the face of a serious revolutionary movement one would expect to see states of emergency, unofficial death squads, and well-resourced propaganda campaigns spreading fascism and xenophobia.

Historical accidents

What conclusions should we draw about the lack of democracy in the so-called communist bloc countries? The Soviet Union etc? The first thing to note is that we dealing with an historical accident. By virtue of some rather specific or contingent circumstances,communists found themselves in charge in countries that with few exceptions were economically and socially backward, and totally unsuited to undertaking a communist revolution. Also, the regimes did not arise as a result of popular support for communism. In the revolutions in the Soviet Union and China the primary concern of the peasant masses was nothing more than land reform. In Eastern Europe the regimes were due to the arrival of the Soviet Red Army at the end of WWII rather than popular revolutions. So I think it is safe to say that these regimes would not have survived if they had been democratic.

However, it is important to keep in mind the alternative in most cases was right-wing tyranny rather than democracy. And of course these regimes eventually lost the minimal revolutionary content they may have originally had.So their authoritarian nature could no longer be blamed on communists. Instead we just had phonies like Vladimir Putin who pretended to be communists until the collapse of the Soviet Union and we presently have people like Xi Jinping in China who still pretend to be communists. The take-home message here is that the conditions were very different from what we would expect in the future when revolutionary regimes come to power in highly developed societies on the back of widespread support for their political program.

Freedom of speech

Now, the economist Milton Friedman famously argued that freedom of speech and the emergence of diverse political groups require the decentralization of resource ownership that only capitalism can deliver.He argued that under capitalism you have the possibility of finding a rich patron. Marx and Frederick Engels and the Bolsheviks received money from anonymous benefactors as well as from robbing banks. Under social ownership, however, resources would be centralized in the hands of the very authorities that you may want to criticize. However, I would argue that with everyone having very high disposable incomes and access to the Internet you would not have to rely on central authorities providing resources. Also I do not see any insurmountable obstacles to ensuring open access for various resources needed for a vibrant political life.

I do not want to paint too rosy a picture.A revolutionary government during its initial phase may have to declare a state of emergency if there is a rebellion by supporters of the old order. Their rebellion could take the form of civil war, terrorism and sabotage, and dealing with it will not be easy. At the same time, for success, we will need the freedom to criticize those in positions of authority when they display incompetence or lack of revolutionary politics. Bottom up supervision will be a critical part of the system. Indeed, a social system that relies on people taking the initiative without external prompting, could not function if people are not able to say what they think is wrong and what they think should be done about it.

Summing up

I will now make two points to briefly sum up.

Firstly, capitalism creates the very economic conditions required for a more advanced classless society that will be based on social ownership of the means of production.

Secondly, a primary task for the present period is ensuring economic and political progress in the more backward regions of the world. For this we need a liberal global economic order, well directed economic aid, and diplomatic and military support in fighting the battle for democracy. And critical to this is beating back the nationalist anti-globalist wind that is blowing at the moment.

 

Is capitalism the best system on offer?

“In place of the old bourgeois society, with its classes and class antagonisms, we shall have an association, in which the free development of each is the condition for the free development of all” – Karl Marx

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This is the text of a talk given by David McMullen at the Monthly Argument on Wednesday October 19, at The Royal Oak Hotel, Fitzroy. David is the author of Bright Future.

Is capitalism the best system on offer?

As you are well aware we presently live under the capitalist system where the means of production are owned primarily by a small ruling class. Now is this system the best on offer? My answer to the question is no. However, the journey to the better alternative is going to be a tortuous process. This alternative is the very opposite of capitalism. It is a classless society where the means of production are socially owned, and it has usually been called communism.

Now how does this alternative claim to be better? It claims to be better than capitalism on the grounds that it would allow the individual to fully develop and thrive under conditions of mutual regard rather than the dog eat dog world of capitalism.

However, for such a society two things are required. These are (1) a very high level of economic development and (2) the successful completion of a rocky period of revolutionary transition during which we fundamentally transform ourselves and our relations with each other.

The first of these – a very high level of economic development – allows us to eliminate poverty and toil, and this is absolutely critical if we are going to dispense with the profit motive. This is because it opens up the possibility of people working because they like what they are doing and they want to contribute, while at the same time being happy with an equal share of an increasing prosperity. While it is possible to imagine people sharing prosperity and enjoyable work, it is not possible to imagine people sharing poverty and toil. The Middle Ages shows us that it only requires a small band of thugs who would prefer to have a lot more than everybody else and you have a very nasty class society. Also the experience of the Soviet Union, and the various regimes derived from it, shows what happens when you try and go beyond capitalism under backward economic conditions.

In the rich countries we have reached an economic level where it is possible to imagine everyone enjoying something approaching toil free prosperity. However, what about the rest of the world where most people live? What are the prospects there? The middle income countries such as China and India should start approaching fair levels of development in a generation or so if they maintain a reasonable growth rate. On the other hand the poorest countries where most people live will need to begin, and sustain, a growth takeoff similar to India and China in order to get to out of their present poverty later this century.

Many raise doubts about the possibility of achieving global economic prosperity. They either say that everyone having high and increasing living standards is impossible because of resource limits to growth or because capitalism’s disregard for the environment will lead to ecological collapse and a very bleak future.

The limits to growth view is based on a number of notions: (1) that minerals become too difficult to extract as we have to dig deeper or rely on lower grades of mineral ore. As a result capital becomes increasingly devoted to extraction and this leaves less and less for the rest of the economy. (2) Economic growth necessarily creates an increasing waste stream that the natural environment can no longer cope with. (3) Increasing food production will ultimately deplete the soil. I think there is ample evidence technological advances can solve those sort of problems. I dealt with this issue at length at the debate in June. It is available online as is this talk.

Now is capitalism going to completely trash the environment because of its shortsighted search for profits? I think we can expect quite a lot of trashing of forests and pollution of air and water as the poorer countries develop. However, countering that is the fact that newer technologies tend to be cleaner and as countries get richer there is increasing political pressure to reduce environmental damage and remedy past damage.

As for CO2 emissions. They are very unlikely to be brought down to the levels that people are talking about. We are pretending to do something while achieving very little. The Europeans have made a lot of noise but are reneging on all their promises. India and China are continuing to build coal power plants at a cracking pace. China is also building quite a few in other countries. Germany and Japan are building more coal power plants because of their stupid decision to get out of nuclear power.

There are two strategies for significantly reducing CO2. The first would involve a massive total switch to renewable and nuclear power in coming decades. However, because these technologies are far more expensive than fossil fuels it is not going to happen. Keep in mind that it would require massive subsidies to the less developed countries who have made it clear that they are not going to abandon much cheaper fossil fuels unless compensated. These countries are already consuming more than half the world’s energy and the percentage will soon be a lot higher.

The second strategy is to to implement a massive research and development program aimed at providing energy options that greatly close the cost gap with fossil fuels. This would be far cheaper than the first strategy. And it is a strategy that Bill Gates is promoting with only modest success. And it is the strategy I support.

For the moment I am noncommittal on the level of threat to the environment that is posed by capitalism’s failure to act on CO2 emissions. Views on the subject range from little impact to a runaway greenhouse effect that would put the human race in a very sticky position.

Now on that rather uncertain note, let’s move on to the second requirement if we are to achieve a classless, collectively owned society. As said at the beginning, we have to complete a very rocky period of revolutionary transition during which we fundamentally transform ourselves and our relations with each other.

While getting rid of the capitalists and installing a revolutionary government will be a protracted and tortuous business, it will not be enough. We also require an entire historical period of struggle to make the transition from a society based on profit to one based on mutual regard. This will have many ups and downs and may possibly include major defeats.

The central thing here is a struggle with a new bourgeoisie that is bound to emerge after the revolution because you can’t immediately eliminate the old division of labor. For some time society will still have a lot of hierarchy, and all levels of government including the very top will be full of phonies pretending to be revolutionaries and also revolutionaries who become corrupted by power. This new group proved irresistible in the Soviet Union and its derivative regimes. To counter this it will be critical to have a revolutionary mass movement that can push back against it.

There is also a struggle with people at all levels of society who are slow to adopt the behavior and thinking of mutual regard. This will require people to have the moral courage, self-confidence and social skills to stand up to problematic behavior. At the moment we tend to knuckle under or run away from a problem. The principle of mutual regard can be summed up as – I will go out of my way for others and others do likewise, and we all share in the better outcome that results. It is enlightened self-interest because our welfare depends on the welfare of others. And we mustn’t forget the direct satisfaction that we get from helping others and contributing to the general good.

I rather like this paragraph from the Communist Manifesto dealing with this subject:

In place of the old bourgeois society, with its classes and class antagonisms, we shall have an association, in which the free development of each is the condition for the free development of all.

Finally, a very important point to make is that the less that capitalism has modernized societies the harder the task of transition will be. Pre-capitalist societies are really awful and people’s heads are full of even more crap than modern people. In these societies the average person is ignorant and uneducated. They are servile and accepting of the idea that some people are superior to others, and have a right to push everyone else around. There is no conception of democracy or individual liberty. The individual is tied down by obligations and loyalties to groups such as extended family, clan and tribe. And women are completely subordinate to men. It is virtually impossible to imagine creating a classless society on the basis of this kind of culture.

So to sum up.

Firstly, a society more advanced than capitalism requires a high level of economic development, what is sometimes called post-scarcity.
Secondly, this new society requires more than simply installing a revolutionary government and dispossessing the capitalists. There is an entire historical period when ordinary people will have to push back against the opponents of the revolution and thoroughly internalize the new morality of mutual regard.
And thirdly, on a more mundane note, there needs to be a massive increase in research and development spending in order to develop the new energy technologies that economic growth requires.

Freedom from want and toil – and the capitalist social revolution

From the Communist Manifesto Project‘s pamphlet: Rescuing the Message.

 

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Freedom from want and toil

The industrial revolution that began over two centuries ago is transforming the material conditions of life in ways that make capitalism obsolete. In the most developed regions of the world it is providing something approaching a modest level of material abundance and removing much of the necessary toil from work. These conditions make it possible to contemplate social ownership where the motivation is no longer profit, or some reward derived from it, but rather mutual regard and the satisfaction obtained from labor.

At the moment, the rich countries are home to only 15-20 per cent of the world’s population. However, the middle income countries such as China, India, Mexico, Turkey and Brazil could well achieve high levels of development over the next two or three generations, while the poorer half of the world should catch up later this century or early in the next. The pace of development will depend on a range of factors including the prevalence of political crises, wars and economic depressions.

With increasing productivity under capitalism, a stage is reached where an equal share of the social product ceases to be shared poverty. Under less developed conditions, the prospect of shared hunger and distress impels those who are in a position to do so to exploit others through plunder, slavery, serfdom or the ownership of the means of production. However, as the average share begins to promise an increasing degree of prosperity, the imperative to fare better than others diminishes. Marx and Engels make this point in part II, section 5 of The German  Ideology:

… this development of productive forces … is an absolutely necessary practical premise, because without it privation, want is merely made general, and with want the struggle for necessities would begin again, and all the old filthy business would necessarily be restored …

Under developed capitalism, mechanization and automation have done much to reduce the odious or toilsome nature of work. Pick and shovel work and carrying heavy loads are things of the past and much of the remaining menial and routine work in the manufacturing and service sectors will be automated in the next generation. The work we are left with will be primarily intellectual in nature and potentially interesting and challenging.

“With increasing productivity under capitalism, a stage is reached where an equal share of the social product ceases to be shared poverty.”

Some doubt the ability of workers to keep up with the requirements of the new work. Certainly capitalism leaves a lot of workers behind and on the scrap heap. Nevertheless, the level of training of workers is higher than ever and should increase over time. In developed countries about a quarter of young proletarians graduate from university and a similar proportion have other forms of training.

We can also expect improved ability to perform complex work in a future communist society as many of the conditions that cause stunted development are eliminated. These include lack of family support, peer pressure to under-perform and an inadequate education system. Social ownership will end the isolation of education from production and other activities, so uniting learning and doing. Workers will help each other to learn. We will also benefit from an increasing understanding of human development and what causes learning difficulties. And over the longer term we can expect to see artificial improvements through mind-enhancing drugs, genetic engineering (induced evolution) and brain link-ups to computers.

The Capitalist Social Revolution

The dominance of capitalist market relations brings a social as well as an industrial revolution. The outcome is frightful in many ways but vastly better than what it replaces. In particular, the revolution casts off many ancient shackles and replaces them with weaker capitalist ones.

Proletarians are employees not slaves or serfs. As wage workers they only have a contractual arrangement for part of the day with their capitalist master and are free to move from one job to another. Their boss, unlike the peasants’ lord, is probably not the local political chief or magistrate.

Their position in the labor market also frees them from subordination to the extended family, tribe or local community. It provides economic independence and the opportunity to physically escape from these sources of oppression and conservatism.

“Their position in the labor market also frees them from subordination to the extended family, tribe or local community. It provides economic independence and the opportunity to physically escape from these sources of oppression and conservatism.”

The new market-based class relations also raise women from their age old subordinate position. The nuclear family replaces the extended family as the economic unit so that women only have to deal with their freely chosen husband and not his relatives. Then comes the independence of employment for a wage. The changing conditions plus struggles by women lead to the removal of legal discrimination, new divorce laws and various forms of government child support. Even the nuclear family becomes optional. These changes cut away much, although not all, of the legacies of women’s oppression and create the conditions where men and women can begin to understand their differences and similarities, and better meet their mutual needs.

The emergence of capitalism has been accompanied by the bourgeois democratic revolution that brings equality before the law, freedom of speech and assembly, due process and constitutional rule. People now expect these political conditions and feel aggrieved by their absence. They could not imagine being ruled by the bejewelled thugs of earlier times. This provides space for the proletariat to organize itself and for a revolutionary movement to emerge and develop. Although when the capitalists feel sufficiently threatened they dispense with these arrangements. This may involve goons and death squads, a state of emergency,  a military coup or the coming to power of a fascist tyrant. However, such drastic measures cannot permanently put the genie back in the bottle and they are bound to provoke resistance.

Overcoming both submissive and oppressive behavior will be at the core of the struggle for communism.  Individuals will require the boldness to stand up to people who act in a harmful manner either to them or to others, while expecting other people to submit to you is completely at odds with a culture of mutual regard. Overcoming the submissive and oppressive forms of behavior found under capitalism will prove difficult enough. Having to at the same time overcome their far more extreme pre-capitalist forms would be unimaginably difficult.

The experience of constant flux experienced under capitalism is also important for communism. Pre-capitalist societies are static. The way of life in your old age is the same as that in your youth. In keeping with this there are set and unchanging ways of thinking and general acceptance of how things are. Under capitalism there is constant change and increasing uncertainty in the conditions of life and the prevailing ways of thinking. It then becomes possible for people to look at where they are and where they are going. This is expressed well in The Communist Manifesto as follows:

All fixed, fast-frozen relationships, with their train of venerable ideas and opinions, are swept away, all new-formed ones become obsolete before they can ossify. All that is solid melts into air, all that is holy is profaned, and men at last are forced to face with sober senses the real conditions of their lives and their relations with their fellow men.

Role of PPPs (Public Private Partnerships) in Transition ( by Arthur Dent)

Guest post by Arthur Dent via Bill Kerr blogspot .

The need that has not been acted on is investment having become generally paralysed by world economic crisis. Not just traditional infrastructure but all kinds of large scale fixed capital construction projects are needed. The essence of transition from capitalism under such a scenario is that it is partially public and partially private.

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PPP = Public Private Partnerships

A scenario for transition from capitalism with socialized investment following another Great Depression and its (im)plausibility is discussed elsewhere.

For present purposes those assumptions are as arbitrary as the selection of some hypothetical specific PPP infrastructure project to pitch to some hypothetical target audience.

The need that has not been acted on is investment having become generally paralysed by world economic crisis. Not just traditional infrastructure but all kinds of large scale fixed capital construction projects are needed.

The essence of transition from capitalism under such a scenario is that it is partially public and partially private.

PPPs would be used for all major fixed capital construction projects that are significant for planning resumption of economic growth and ending mass unemployment. Buildings and plant that were previously (not) being privately financed, by single enterprises or project finance, not just the closely related “utilities”. Public institutions would also initially be largely untransformed, so public procurement of a traditional public utility infrastructure facility by a public agency would be subsumed under PPP arrangements as just another private participant that happens to be a public agency.

Public financial and economic planning and management organizations would be involved either as sponsors or minor participants in many types of build, own and operate projects, often taking substantial financial positions in both debt and equity based on the expropriated funds they are now able to invest as well as making ordinary commercial PPP arrangements with private participants.

The relatively small amount of economic and management expertise fully supportive of transition available to an inexperienced government would be heavily focused on the preparation, procurement and contract management/implementation of PPPs. They would have to structure the contracts so the private participants use their know how to maximize the public benefit in their own commercial interests. This would be very difficult and error prone, but not as implausible as simultaneously taking over all existing large economic institutions without enough skills to actually manage them in the public interest.

The much wider role of PPPs requires much better resourced public institutions responsible for PPPs. The relatively small numbers of government decision makers with adequate skills must supervise and structure appropriate incentives to motivate, much larger number of employees and consultants recruited from the private sector for their know how, despite their lack of support for transition.

Currently known “best practices” for PPPs would be generally applicable. There is no point in listing them. But the assumption of quite different circumstances imply many new lessons could only be learned from experience with at least the following differences from the usual circumstances.

1. Much greater transparency and much less corruption would be imposed on both the public and private participants as part of the broader social changes involved in transition.

2. Greater flexibility for detailed renegotiations would be necessitated by the circumstances of economic crisis and the more dynamic situations arising from transition.

3. Political, foreign exchange and national macroeconomic risks (interest rates etc) would be exclusively borne by the public participants and corresponding contingent liabilities and hedging or insurance costs appear openly on the central balance sheets. The public institutions responsible for exchange rates and macroeconomic stability would be closely involved in understanding the financial flows and risks they are assuming and the prices they require for asuming those risks and any hedging arrangements they may be able to make separately. Both international and local private participants would not need to make separate judgments or their own hedging arrangements for particular projects but only apply the sovereign risk ratings assessed uniformly by their own trusted ratings agencies.

4. Land use and resource management public agencies would likewise manage and appropriately price the responsibilities for land acquisition, site and regulatory risks.

5. Design, operations, construction, completion and maintenance performance risks would be exclusively borne by the private parties directly responsible for each aspect with detailed incentives tailored to reward overperformance and penalize underperformance. They would be carefully separated according to the expected and actual costs and risks borne by the participants engaged in each aspect and related global, national and sectoral statistical indexes.

6. Allocation of upside and downside market risks for supply of inputs and sale of outputs would be significantly more complex since the expropriation of private wealth for public investment in PPPs was made necessary by lack of profitable investment outlets in the prevailing market conditions of economic crisis.

The aspect for which each private participant is responsible must be commercially viable to that participant at the low competitive rates of return prevailing under crisis conditions. But the overall project need only be value for money to the public participants based on accepting an even lower (or even negative) return on their investment in order to achieve planned economic growth and rapid recovery from mass unemployment.