imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List




IMC Network:

Original Cities

www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities

www.indymedia.org africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

Worldwide Economic Crisis 2.0 or the Collapse of Neoliberal Finance Capitalism

by Joachim Hirsch Wednesday, Nov. 24, 2010 at 5:00 PM
mbatko@yahoo.com

The present crisis is a consequence of the fact that exploding business profits found inadequate investment opportunities in the productive sector and turned instead to financial speculation. Deregulation created "law-free" spaces" with the abrogation of all political controls.

WORLDWIDE ECONOMIC CRISIS 2.0

OR THE COLLAPSE OF NEOLIBERAL FINANCE CAPITALISM

By Joachim Hirsch

[This article published in October 2008 is translated from the German on the Internet, http://links-netz.de/T_texte/T_hirsch_finanzkrise.html.]

“…what is proposed is not the nationalization of private corporations but rather a corporate takeover of government. The marriage of highly concentrated corporate power with an authoritarian state that serves the politico-economic elite at the expense of the people is more accurately referred to as `financial fascism.’” Robert Scherr in The Nation

As everybody knows, crises are part of capitalism. Now and then these crises can be massive like the present crisis. Their frequency seems to accelerate. Over fifty years passed from the great depression in the 1870s to the first worldwide economic crisis of the 1920s. The ensuring Fordism lasted only five short decades, to the middle of the 1970s. The establishment of neoliberal finance capitalism described as globalization or post-Fordism followed the crisis of Fordism. Over thirty years later, the global economic and political relations of power are now shifting again. Identifying the capitalism now facing us is obviously not easy with these rapid changes. There is no agreement on naming its form that is coming to an end or whether it is an independent phase or an extension of the Fordism crisis. The term “post-Fordism” was a helpful description.

Neoliberal finance capitalism is a particular historical formation of capitalism with a specific crisis dynamic. Therefore the current crisis is essentially different from the crisis of Fordism or the crisis of the 1930s even though parallels are often drawn now. While the Fordism crisis was based on declining capital profits owing to decreasing rationalization possibilities and more favorable power relations for wage-earners, the present crisis is a consequence of the fact that exploding business profits found inadequate investment opportunities in the productive sector given a structurally limited consumer demand and turned instead to financial speculation. Thus a specific case of the capitalist over-accumulation crisis occurs. After this speculation bubble burst, post-Fordism also belongs to the past. Thus the manner and way that the crisis of Fordism was overcome laid the groundwork for global capitalism facing its collapse today.

Current explanations for the economic disaster blame irresponsible and greedy speculators who appear everywhere in the system of so-called turbo-capitalism and not only in the mammoth financial corporations. CEOs like Ackermann of Deutsche Bank believed 25% capital profits could be gained in the long run without anything going wrong. That the debt bubble exploited by these financial jugglers for their own objectives was a systematic element of neoliberal capitalism is concealed in the public discussion. Speculating about the consequences of the financial crisis for the so-called “real economy” (a revealing term) is hypocritical. Steinbruch, Glos, Weber and their accompanying professorial choir must know the financial bubble was the foundation of the “real economy” and not an avoidable malformation.

The deregulation of the capital- and financial markets pushed through at the end of the 1980s created the “law-free” spaces with the abrogation of all political controls. Speculators could exploit these “law-free” areas for their criminal actions. What is termed globalization was nothing but a strategy that aimed at a fundamental shift of the social hierarchy of power in favor of capital and led to a drastic change in income distribution, the impoverishment of large sectors of the population and an enormous social precariousness. Globalization was consciously pushed through by the governments of the domineering states in cooperation with international capital in the wake of the Fordism crisis. That managers now stand as scapegoats and politicians as rescuers blurs the responsibilities. Business profits virtually exploded because of this specific kind of “globalization.” With increasingly unequal income distribution, their realization was only possible because a kind of global Keynesianism was established.

The growing private and state indebtedness – above all in the US – ensured the necessary demand and was the basis of an economic “upswing” that was built on sand from the start. That this system had to collapse some time or other was clear to everyone with a certain economic expertise – which was obviously not true for the conventional economic wise men. Only the moment when the collapse would occur was not clear. Until then the circle of indebtedness would simply drive on and on. This was called turbo-capitalism. This is now at an end.

The connection of crisis and war is interesting. Overcoming the great depression (in the 19th century) occurred with the arms race. The rise of the two superpowers, the US and the Soviet Union, led to the power-political constellation that first made Fordism possible. The defeat of the US in the Vietnam War contributed to the collapse of the Fordist Bretton Woods system of fixed exchange rates and controls on capital transactions and thus to its crisis. The debacle in Iraq and Afghanistan that was the fault of the US points to a similar connection. In any case, the international debt economy was strongly supported.

Three billion dollars of direct war costs must be financed somehow every week. In the course of history, capitalist formations were allied with the hegemony of states that pushed through and guaranteed international rules and institutions – obviously for their own advantage. These were Great Britain in the 19th and the US in the 20th century. The international economy was lent a certain stability for some time. The crisis of Fordism put in question the economic hegemony of the US. The US reacted with the globalization strategy introduced through “Reaganomics” and establishment of neoliberal finance capitalism. This served the goal of restoring the economic, political and military hegemony of the US after the collapse of the Soviet Union. Now this hegemony is over. The present crisis could be the beginning of the end to an “American” century that began with Roosevelt’s New Deal in the 1930s. The whole world was reordered.

State-capitalist countries like China seem less affected b y the crisis even if they cannot withdraw from the suction of the threatening global recession in the long run. They have never renounced on politically controlling their capital- and financial markets. “State bonds,” branded a dangerous evil in the past, are suddenly welcome as rescuers. Scherr’s emphasis on a “financial fascism” is certainly an exaggeration. While there is some truth there, the consequences of the financial crisis are not clear.

The collapse of debt-based neoliberal capitalism will lead to a long-lasting global economic depression as long as the existing hierarchy of power is not changed. This is certain. There are no signs of that change. Present-day bailout actions aim at maintaining this pecking order. Alternatives are not in sight. Rather the establishment of a state-capitalist system is manifest in past dominant capitalist countries which is marked by a close fusion between capital and the state in the wake of the crisis. One can speculate whether the (partial) nationalization of the banks represents the takeover of the banks by the state or the opposite.

A kind of fusion of big capital and the state is occurring. Drawing hope for that for a stronger political control of the economy is misguided in that politics for a long time in nearly all domineering states practically guaranteed capital’s profits by absorbing immense social and ecological costs. If the bailout actions succeed and the banks are revitalized, the re-privatization of security will be queued up. That the bailout of bankrupt businesses and the revitalization of financial speculators will saddle taxpayers shows where the journey is going. The credit bubble will become greater and capital destruction compensated by increased state debts. Thus the fundamental economic instability remains even if a temporary calming occurs.

To master the crisis, the “re-regulation” of the economy is now on the political agenda. The state monopoly capitalism, the close connection of state and capital for the purpose of securing profits, will be extended with more solid institutional structures. German fascism, the reaction to the crisis of the 1930s, could be a kind of model. This process will not require the removal of democratic conditions. Rather the process can be advanced in the scope of liberal-democratic structures that have long decayed to formality. This is what Scheer means by “financial fascism.”

Capitalism actually faces a maximum credible accident. Its consequences as to political conditions could be more than disastrous. This recalls the worldwide economic crisis of the 1930s. The crisis is now used to persuade people to tighten their belts even more in the future. The existing economic and social system should be abolished instead of being only repaired as a stopgap. The alternative to neoliberalism is not a “moral” and “responsible” capitalism. That is a contradiction in itself.

RELATED LINKS

Schuhler, Conrad: “Market Failure Wherever One Looks,” July 2010

http://portland.indymedia.org/en/2010/10/403029.shtml

VIDEO: "21ST Century Enlightenment"

http://www.wimp.com/centuryenlightenment/

Workers Action, “The Struggle for a Workers’ Recovery,” October 13, 2010

http://portland.indymedia.org/en/2010/10/402968.shtml

Free Internet Book "Culture Change" by Alexis Zeigler

http://conev.org/ren14x.pdf

Free Internet Book “Enough is Enough” by Herman Daly, Brian Czech and others, June 2010

10-page summary:

http://steadystate.org/wp-content/uploads/EnoughIsEnough_Summary.pdf

130-page report:

http://steadystate.org/wp-content/uploads/EnoughIsEnough_FullReport.pdf

related videos from CASSE:

http://steadystate.org/leeds2010/videos/

Report this post as:

LATEST COMMENTS ABOUT THIS ARTICLE
Listed below are the 10 latest comments of 1 posted about this article.
These comments are anonymously submitted by the website visitors.
TITLE AUTHOR DATE
More of The Global Satanic Government's (The CIA) Post 9-11 War Bushonomics Global Satanic Government's War Bushonomics Thursday, Nov. 25, 2010 at 1:37 PM

Local News

Marshall Tuck’s racist dog whistle O27 5:01AM

Marshall Tuck’s ethnocentrism contradicts Californian values O27 4:32AM

Contra Costa-Hawkins O25 3:48AM

Debunking Some Anti-Prop 10 Propaganda O12 6:56AM

Why Should California Choose De Leon Over Feinstein? O10 9:55PM

Change Links September 2018 posted S02 10:22PM

More Scandals Rock Southern California Nuke Plant San Onofre A30 11:09PM

Site Outage Friday A30 3:49PM

Change Links August 2018 A14 1:56AM

Setback for Developer of SC Farm Land A12 11:09PM

More problems at Shutdown San Onofre Nuke J29 10:40PM

Change Links 2018 July posted J09 8:27PM

More Pix: "Families Belong Together," Pasadena J02 7:16PM

"Families Belong Together" March, Pasadena J02 7:08PM

Short Report on the Families Belong Together Protest in Los Angeles J30 11:26PM

Summer 2018 National Immigrant Solidarity Network News Alert! J11 6:58AM

Watch the Debate: Excluded Candidates for Governor of California M31 5:20AM

Change Links June 2018 posted M28 7:41AM

The Montrose Peace Vigil at 12 Years M22 8:01PM

Unity Archive Project M21 9:42AM

Dianne Feinstein's Promotion of War, Secret Animal Abuse, Military Profiteering, Censorshi M17 10:22PM

CA Senate Bill 1303 would require an independent coroner rather than being part of police M10 9:08PM

Three years after OC snitch scandal, no charges filed against sheriffs deputies M10 8:57PM

More Local News...

Other/Breaking News

Help translation of From Islam To Womanism book on IndieGoGo N13 12:04PM

COP 21, 25, 32, de l'écocide organisé N11 11:45PM

fbi & fmj are ' Lord of the Flies ' N11 8:26PM

Parangon d'une grande infestation N11 12:03AM

Video: Beautiful Country Burn Again, 39 min N10 10:19PM

OBAMA WERE POW'S LEFTBEHIND IN AFGHANISTAN IRAQ AND LIBYA N08 7:57PM

OBAMA WERE POWS LEFT BEHIND IN AFGAHNISTAN IRAQ AND LIBYA N08 7:29PM

DID BARACK OBAMA LEAVE POWS BEHIND IN AFGAHNISTAN IRAQ AND LIBYA N08 6:43PM

DID BARACK OBAMA LEAVE POWS BEHIND IN AFGHANISTAN IRAQ AND LIBYA N08 5:50PM

Paraphysique de l'Etat d'urgence N08 4:24AM

Republican Vote Fraud Reached A New Level In Midterms N07 7:50PM

Lobotomisation populationnelle N07 7:28AM

Texas Finally Ousts Culberson! N07 4:43AM

Israel Quit UNESCO, Um-Shmum, Make Ben-Gurion Proud! N06 7:37PM

Mafia City Hack Mod Generator - Generate 15.000 Gold N06 2:04AM

Ronald L. Havner & The Sleazy Corporate Whores @PublicStorage RAPED ME! N05 10:25PM

Trumponomics and Wall Street Rejoices N05 11:36AM

8 GOP Candidates For Governor Want Executions To Continue In Their States N05 10:11AM

Paraphysique de l'hybris pirocratie N05 7:40AM

Pity Yitzhak Rabin Wasn’t Israel’s Trump! N03 11:01PM

Une machine c'est crétin N03 7:45AM

Nuke Plants Cause Excess CancerDeaths When Running, Rates Decline When They Shut Down N01 10:20PM

Right-wing Populism: A Wave of Nostalgia N01 11:02AM

Paraphysique du profit de l'horreur N01 8:11AM

Trump: A Disaster For Animals As Well As People O31 10:25PM

26 Ways Trump Has Increased The National Debt By 4 to 5 Trillion Dollars O31 9:44PM

Right-wing Populism: Can More Madness Cure the Madness? O31 2:13AM

OUR HOUSE Grief Support Center Presents Night for Hope O30 5:38PM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy