[Marxism] "Crisis allows us to reconsider left-wing ideas"

[David Thorstad]

www.irishtimes.com:80/newspaper/opinion/2008/1018/1224279408893.html 
<http://www.irishtimes.com/newspaper/opinion/2008/1018/1224279408893.html/>


Irish Times                                        
October 18, 2008

Crisis allows us to reconsider left-wing ideas

Paul Gillespie

WORLD VIEW:IN NOVEMBER 1857, Karl Marx wrote to Frederick Engels: "The 
American crash is a delight to behold, and it's far from over." He 
predicted the financial crisis - the most geographically widespread to 
have hit 19th-century capitalism until then - would deepen and lead to a 
complete collapse of Wall Street, writes Paul Gillespie

Notwithstanding his own financial distress, he had never felt so "cosy". 
Engels himself felt "enormously cheered". The events confirmed their 
theoretical analysis and political strategy of linking reality to 
preparedness.

That crisis spurred Marx to complete his economic studies on finance 
capital and its cycles of boom and bust, clearing the way for the more 
comprehensive Das Kapital, published 10 years later. It theorised the 
system as an anarchic, irrational and blind competition, pursuing profit 
and accumulation.

Credit and production expand in a contradictory way until they can no 
longer sustain profitability. Then collapse clears out waste, 
reorganises production and stimulates the capitalist state to amend the 
rules governing trade, finance and investment. The state's role 
oscillates between night-watchman and direct intervention, but its power 
should never be underestimated.

Marx's work has suddenly become popular again in Germany, as a new 
generation tries to understand the dynamics of these events and how they 
should be evaluated historically. There are disturbing memories of the 
1929 crash and its awful political consequences, coming after the 
1922-1923 financial collapse which destroyed German savings. As the 
crisis unfolded three weeks ago, German finance minister Peer Steinbrück 
was quick to claim "the US will lose its status as the superpower of the 
world economic system. The world will become multipolar." It is 
happening before our eyes. And Steinbrück says "generally we have to 
admit that parts of Marx's theory are not so bad".

Commentators have been quick to notice, and many to mock, such left-wing 
schadenfreude, whether directed at the US or capitalism as a whole. 
Germans especially should be aware of how hubris and nemesis can follow 
one another - as Steinbrück found out a mere 11 days after saying a bank 
rescue programme was not needed when he announced a plan to protect 
German bank deposits.

Although this is undoubtedly a grave crisis for finance capitalism, with 
deep effects on the real international economy, it is not - as yet - a 
systemic collapse. The extraordinary speed and depth of the events and 
the $1.8 trillion response to them, especially this week in the European 
Union, have helped avoid the meltdown heralded at the weekend by 
Dominique Strauss-Kahn at the International Monetary Fund meeting in 
Washington. French president Nicolas Sarkozy, British prime minister 
Gordon Brown, German chancellor Angela Merkel and Spanish prime minister 
José Luis Rodríguez Zapatero are taking the lead to create a "refounded 
capitalism" more capable of withstanding such cyclical shocks by better 
global regulation.

In an audacious initiative, Sarkozy and EU Commission president José 
Manuel Barroso are meeting US president George Bush this weekend to seek 
a G8 summit next month on a new agreement to regulate global finance. 
Presumably it would include the president-elect. If that is Barack 
Obama, he will be confronted with a dramatic adjustment of US power to a 
more multipolar world, for which he is better prepared and which he is 
more willing to accept than John McCain.

Note that most of these leaders are from the centre right, not the 
centre left. Centrism is resurrected from the wreckage of radical 
right-wing deregulation, more than is the left. The argument is about 
re-regulation rather than redistribution, the public rather than the 
private interest, transnational against national sovereignty.

So far, that is. The traditional left has had little operational 
purchase on the crisis other than I-told-you-so utterances about their 
inherently cyclical nature. Confronted with this international 
convulsion, "the Left" is for the most part as weak and tame as it 
certainly is in Ireland. Popular anger here and in the US, for example, 
is far more radical, but not expressed in such vocabularies. This is a 
real challenge and also an opportunity for the left - just as it was for 
Marx and Engels 150 years ago.

But does the left refer to traditional social democracy, which accepts 
market capitalism but seeks to equalise it; to the "third way" variety 
popularised by Blair and Brown; or to the "democratic socialism" of 
post-Stalinist parties? What of more recent green socialism? How to 
classify the rump of traditional Stalinist parties in Europe, India and 
elsewhere? Should Chinese and Vietnamese one-state authoritarian 
capitalisms led by such communist parties be included? Where do the left 
of South Africa's ANC and the burgeoning variety of Latin American 
left-wing movements fit in? Is the US Democratic Party part of that 
family? How do all of these relate to the growing radical or far-left 
tendencies and social movements drawing on previous bottom-up 
revolutionary traditions such as Trotskyism and anarchism?

Big events revive these debates, but they need to be reinvented for new 
times. Conventional sociological post-industrialism accounts rendering 
left ideologies and movements redundant badly need revision in the light 
of falling living standards and growing inequalities. So does Fukuyama's 
notion of the end of ideology and the triumph of market capitalism - as 
he now admits. Big names too: Keynes, Polanyi, Kondratieff, Galbraith 
and now Paul Krugman are deployed by social democrats against those who 
want to resurrect Marx and Engels. [pgillespie at irish-times.ie ]


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