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by Heinz-J. Bontrup
Monday, May. 01, 2017 at 4:59 AM
Competition cannot be an end-in-itself. Uncontrolled private power leads to misuse. Uncontrolled competition increasingly destroys itself through concentration and centralization processes. Bastard Keynesianism helps the banks. People diverted from real cause of crises
COMPETITION IDEOLOGY AND POWER REALITY
By Heinz-J. Bontrup
[This study is translated abridged from the German on the Internet. Heinz J-Bontrup is a critical economist, author and member of the Alternative Economic Policy study group in Bremen.]
Concentration and centralization in the economy advance inexorably. The impression is no one is interested anymore. Concentration research was an essential branch within economics. Concentration of power in the economy is criticized and politics is warned of its negative consequences. Since the classical national economy, concentration and centralization in economics were closely connected with the term competition. For Adam Smith, competition constitutes the free enterprise system and that system cannot be imagined without it. For Karl Marx, an imminent concentration and centralization of capital necessarily follows from the capitalist competition principle that ultimately undermines and restricts competition more and more. The 2007 empirical study of the Zurich Technical Academy confirms this impressively and alarmingly. This study concluded that only 147 corporations control the world economy and the 50 most powerful businesses are almost an exclusive club of banks, insurances and funds. The British Barclays Bank was highlighted as the most influential; business in the world.
A detailed anthology of Attac Austria recently referred to the state of corporate power and its misused engagement in relation to the state or politics. In the Introduction "A World of Corporations," we read: "Transnational corporations today are concentrated and linked with each other so this world appears as their world. (…) These corporations outstrip the gross domestic product (GDP) of rich states. For example, the sales of Royal Dutch Shell in 2010 were greater than Austria's GDP. (…) Through the ownership structure, these businesses of the `real economy' are closely interwoven with the financial sector. Big banks and investment funds are the most important owners of global businesses – alongside other corporations. A closely meshed network of a few individual profiteers of this system reflected in the global distribution of wealth arises out of this linkage. At the beginning of 2016, Oxfam revealed that according to its study the wealth of the richest 62 persons was equal to the wealth of 3.6 billion – half of the whole world population. This wealth of the richest persons rose 45% between 2010 and 2015, a time of general economic crisis while the wealth of the lower half fell 38%.
How can the competition principle be the center and goal for all economic actors and even for the whole society on the background of this sobering finding? The competition imperative is unquestionably more than ever in the center of the economy and politics, in newspapers, books, management courses and university seminars. "The battle over competitiveness is the most debated economic question of the last twenty years, the Group of Lisbon said. Still today, economists are not agreed on the definition of competition. There are different micro-economic theories of competition from a static perfect and imperfect rivalry to notions of competition as a dynamic process of advancement through innovation and productivity. Competition is also a constitutive factor of a free enterprise-capitalist economic system as well as a premise in macro-economic theory and influences economic policy deduced from theory. Competition is mentioned again and again as a combative term in a globalized economy where rivals must focus on their competitiveness.
There are also different definitions of the term concentration. Non-Marxist terminology and Marxist economic theory must be distinguished. For Marxists, the concentration of capital is a consequence of the fact that the owner of capital does not consume the profit but adds this profit to his already existing capital in the course of expanded accumulation. Non-Marxist theory calls this process "internal business growth." Some businesses in a branch grow faster than their rivals by transforming profit into real capital (e.g. buildings and machines). This faster growth can be a result of market power and its influence on the sales – and/or employment-market side and need not refer to special achievements (innovations) of businesses. Repression processes not based on performance often lead to businesses being eliminated from the market. Non-Marxist economic theory calls this "external business growth." The two processes are interdependently connected. For Karl Marx, they marked the capitalist development from a competitive state to the formation of monopolies.
COMPETITION CONSTITUTES THE FREE ENTERPRISE CAPITALIST ORDER
Competition is considered system-constituting in an order of decentralized planning of the social division of labor based on the private ownership of the means of production in contrast to a centralized planned state economy. As a classical economist, Adam Smith used competition as a "weapon" against the feudal-mercantilist order and against the state absolutism that only impedes the progress of a nation to real wealth. The economic liberalism developed in his epochal work "The Wealth of Nations" published in 1776 (original title "An Inquiry into the Nature and Causes of the Wealth of Nations") emphasizes the individual freedom of economic subjects in relation to the state. Up to today, this characteristic style is directed against nearly all Keynesian attempts to influence the economic course through democratically legitimated state steering.
Since the middle of the 1970s, the neoliberal paradigm replacing Keynesianism more and more became the political-economic delusion that the state has no interest in the economy. "This has to be left to the autonomous steering by competition in the market. This corresponds to the democratic principle of individual freedom and development. Only competition leads to maximum efficiency in developing and distributing economic wealth. Malformations were intensified and even caused and not avoided or mitigated by "state interventions" (Alternative Economic Policy study group). On the other hand, the "invisible hand" (Adam Smith) of competition always leads to the best macro-economic welfare through the selfish pursuit of economic goals of individual economic subjects.
In 1776, Adam Smith described this as follows: "We expect our food not from the kindness of the butcher, baker and brewer but in that they see their own interests there. We do not turn to their charity but to their self-love. We speak of their advantage and do not mention our own needs." (Adam Smith, The Wealth of Nations) Competition guarantees an optimal quantitative and qualitative supply of goods according to the desires of consumers. To speak with Adam Smith again: "The aim and goal of all production is that the consumption and interests of producers should only be considered as this is necessary for promoting the interests of consumers. This maxim is so completely obvious that it would be outrageous to have to prove it." Helmut Steiner remarks today: "People speak of a `democracy of the market' on which the consumer with his or consumer decision as a `vote' steers production. The postulate of consumer sovereignty results from an economic system in which the consumer is the exclusive goal and the economy is merely a means." The million-fold individual plans of economic subjects and production factors (labor, capital and land) are guided in the most efficient directions by competition. In addition, competition should be seen as history's most ingenious instrument for stripping away power" (Franz Bohm) since it brings about inexpensive production methods and low prices wit6h good product quality and product innovations and limits profits to a minimum. Profitable distribution should occur strictly according to the performance-principle or market achievement. Last but not least, the competition principle is protected from a mutual exploitation of economic subjects on the market- or consumer side by choosing between several suppliers.
FAILING COMPETITIVE ORDER
These perceptions of the supposedly beneficial competition for everyone have long been shown to be absurd by economic reality. This is true both for consumer sovereignty (for example, try to enforce your consumer sovereignty over against Comcast) and for business feeling obligated to supply or serve the market. This is a completely contradictory capitalist notion. "Businesspersons regret when they supply the market. The longer the market is not supplied, the greater the prospect for sales and profit," Wilhelm Rieger wrote in 1959. The history of the capitalist economic system is a continuous history of the expropriation of private owners, the accumulation of property among large private property owners, the concentration of power among a constantly smaller number of owners and big shareholders and the growing powerlessness of more and more people" (Winfried Wolf, Merger Power, 2000). Unfortunately, neoliberal market radicals in politics, the economy, academia and the media refuse to recognize this knowledge even today for ideological-interest-laden reasons.
Competition liberalism, "Laissez-faire" had had its day at the peak of the worldwide economic crisis from 1929 to 1933. Before the "Great Crisis," an "organized capitalism" (Rudolf Hilferding) already carried ou8t a "reorganization of capital" through a far-reaching monopolization in the form of cartels, corporations and trusts. The "free play of market forces that supposedly always lead to a news market balance freed from crises of supply did not function at the peak of the crisis. Prices dropped because of oversupply while wages fell drastically. Lack of purchasing power demand increased the over-supply and the unemployment numbers steadily skyrocketed instead of the economy leading to a full employment balance. The state that according to liberal theory should be kept out of the private economy with a balanced state budget increasingly poured oil into the fire and aggravated the crisis with its practiced austerity policy. In 1933, a fascist-state authoritarian rule arose through the crisis with mass unemployment and impoverishment in Germany that finally led to the Second World War in 1939. At its end in 1945, 50 million dead were mourned. When Hitler gained power, a third of the available workers in Germany were unemployed. The capacity of industrial production collapsed nearly 50%.
After 1945 and 1949 (after Germany's separation in East and West), the Federal Republic of Germany arose. Except for the CDU, the ruling class in West Germany wanted to know nothing anymore about a pure market- and competitive economy. The "Freiburg school" represented by economists like Walter Eucken, Alexander Rostow, Wilhelm Ropke, Alfred Mueller-Armack and Ludwig Erhardt was one of the critics of an uncontrolled free enterprise order. Society as a whole "cannot be built on the law of supply and demand," Wilhelm Ropke said. Alfred Mueller-Armack, the author of the term "social market economy," demanded a strong state to enforce the "competition principle." He wrote: "trust in the self-healing power of the economy is impossible in relation to the economic crisis. (…) The errors and omissions of the liberal market economy lie in the narrowness of the economic worldview represented by liberalism. (…) The state has the uncontested task of redirecting the income streams resulting from the market process through the state budget and public insurances and making possible social services. (…) All this belongs to the nature of this order. To see only the uninfluenced market process without recognizing its varied embedding in our state order would be a farce." (Alfred Mueller-Armack, 1976).
Even if Adam Smith was a vigorous advocate of the free enterprise competition principle, he warned at the same time of businesspersons who circumvented disagreeable competition dependencies where they could. To maximize their profits, they restricted competition through concentration and centralization or eliminated it through agreements (cartels). Smith wrote: "Businesspeople in the same branch seldom come together for festivals and diversions without ending their conversations in a conspiracy against the public or cooking up some plan for raising prices."
The naïve idea of a perfect competition on perfect markets where the market price should be determined by the marginal supplier with his marginal costs that do not cover the fixed costs with a linear cost process is out of tough with reality…
Today the competition theory no longer assumes an ideal perfect competition… Rather businesses have power and are constantly intent on eliminating competition through strategies of negotiation and/or concentration and centralization. "`I want to kill my rivals' was the answer of a former director for research and development of Shell International to the question why business invests in R & D." In this context, Werner Hofmann explained: "The `tendency to monopoly' arises from the basic nature of capitalist acquisitiveness. The principle of profit is perfected in monopoly profit as the incessant war of competition is fulfilled in every fighter's hope of defeating the other. From the beginning, the tendency of its self-annulment inheres in the relation of free competition" (Werner Hofmann). Therefore monopolism is the "legitimate child of free competition" and by no means the "changing skin of a state regulatory policy running counter to a spontaneous competition demand of private enterprise (as Walter Eucken said). No individual economist wants the relation of competition to which he or she is subject…
On the different markets, it is only a question of time until competition among businesses succumbs to concentration- and centralization processes or passes into oligopolist rivalry. Unlike perfect or imperfect competition, oligopolist rivalry directly influences prices… Nevertheless, concentration and centralization do not completely exclude competition… As a rule, intensified cut-throat competition leads unavoidably to falling prices. Even monopolists or market-dominating businesses feel the price-elasticity of demand on their sales markets. The monopolist ultimately has the power to define the adjusted situation on the market…
The simplest method for profit maximization is the elimination of competition through concentration and centralization.
Thus the competition model emphasized ideologically again and again by politics, the economy, academia and the media is more than shaky. Heidron Abromeit rightly explained: "The empty competition concept only served as a veiled justification of a private firm's freedom of action without offering a legitimation for this freedom." The Group of Lisbon stressed four effects of competition, competitiveness, or a completely unfettered competition ideology:
"The first result of the ideology of competitive war is that North Americans, Europeans, and Japanese wage competition to the burden of the socially weak in their countries." A proponent of competition ideology recently expressed the same idea differently. He asked how British firms could still compete with South Korea, Indonesia or Chinas if social security were not cut again and wages are 30-, 40- or 50-times higher than in the Asian countries. The second result of this ideology is that the value of competitiveness is lost at the end if everyone competes against everyone else. Everyone cannot be competitive against everyone else. When everyone competes with everyone else, the whole system will collapse sooner or later. The third effect of competition ideology is one-sidedness. Only one dimension of human and social history is seen – the spirit of competition. This spirit of competition and aggression is a powerful motor for action, motivation, and innovation. However, this spirit does not run independently of other driving forces like the spirit of cooperation and solidarity. A fourth result of competition ideology is reductionism and sectarian fundamentalism. This ideology is not only one-sided; it also can hardly see. It does not see things in the right standard. Competitiveness reduces the whole human condition to the attitudes and behavioral forms of the `homo oeconomicus' as `homo competitor.' For the homo oeconomicus, knowledge, convictions, and lifestyles have no importance since they are subordinated to competitiveness and legitimated by it. Otherwise, they are irrelevant for the economy." [The Group of Lisbon (Ed) Limits of Competition]
COMPETITION WITHOUT CONTROL IN GERMANY
Continual supply- and demand-conditioned as well as international market adjustments that went along with intensive concentration and centralization processes demonstrate the tendency to market-marketing worldwide imminent to competition. From 2008 to 2015, there were 630,987 mergers and takeovers of parts of corporations. On average, there were 78,873 mergers or buyouts of businesses every year. The asset volumes altogether were .7 trillion, .9 billion per merger on average… Up to today, politics has not reacted in a scandalous way.
The essential reason for mergers lies in the danger of a potential over-accumulation and risk diversification of invested capital over several branches… The merger upswing intensified after the reunification and the establishment of the European Monetary Union with the euro's introduction. Altogether the numbers are evidence of a complete failure in "preventing mergers" in Germany…
The basis for the political conclusions and recommendations is the dual conviction that firstly uncontrolled private power leads to misuse and therefore must be prevented and secondly that uncontrolled competition increasingly destroys itself through concentration and centralization processes and does not guarantee any optimal economic- and social development. Competition needs a political and social framework in which decisions about the main direction of economic policy are made and competitive conduct of businesses is forced. Decisions about the main directions of economic development – for example, energy supply, transportation infrastructure, the education- and public health systems – are made on the basis of democratic processes of discussion and will-formation that are ordered according to social preferences and not according to purely economic profit criteria.
The political demands to correct the malformations in the market, competition, and concentration are varied. Competition cannot be an end-in-itself. Reality all over the world demonstrates this. Ultimately competition leads only to accidental results that can be predicted, judged positively from a theoretical perspective or legitimated democratically. Therefore competition needs the strong "state hand" of political control. The law against competition restrictions must be strengthened. Cartels must be sanctioned according to criminal law and not only with fines and market shares noticeably cut back for preventative merger control. De-cartelization of businesses to shatter unbearable economic power is urgently necessary… The vital changes to contain economic power must obviously be carried out in a concerted action on the European plane for the whole European Union. An internal business control through developing worker participation and economic democracy are imperative. Employees or their elected representatives cannot have an exclusive right to speak today. In corporations with 2000 employees, the supervisory board should be filled with representatives from consumer- and environment protection and not only with representatives of capital- and the co-determination side. The dominant politics up to today fails the urgently necessary conversion right down the line.
LABOR, CAPITAL, AND STATE: BOOK REVIEW
By Norbert Reuter
[Heinz-J. Bontrup's "Labor, Capital, and State. Plea for a Democratic Economy," 4th edition, 649 pages, Koln 2011 was reviewed in the Frankfurter Rundschau.]
ARGUMENTS AGAINST THE NEOLIBERAL MONOTONY
The neoliberal agenda is spread even in most critical books on the dominant economic policy: why wages and taxes are too high, working hours too short and working conditions too rigid or the state too large. The 2010 Red-Green agenda is seen as a beginning. Few books are written against the stream like Albrecht Mueller's "The Reform Lie" or Peter Bofinger's "We are better than we think." With his new book, Heinz-J. Bontrup strengthens the countercurrent.
On 424 pages, the economist presents a comprehensive criticism of neoliberal economic policy. Whoever reads the work will be richly rewarded. Bontrup is not satisfied with scratching the surface. His political-economic agenda in the last chapter is explained fully in the preceding three chapters. Its strength lies in the double perspective of an internal- and a macro-economic perspective and not only in the connection of theoretical and empirical material. Readers are rewarded with excellent quotations of the grand masters of the economy from Adam Smith to Paul Krugman. Clearer than in other critical publications, Bontrup emphasizes the forgetfulness of history and theory in the dominant economy.
THE LABOR MARKET IS NOT A VEGETABLE MARKET
This is not an easy book. The prominent notion that labor markets function like fruit- and vegetable markets is simple in its argumentation. To sell the last apple, the green-grocer only needs to lower the price – as with the commodity labor power. Bontrup unmasks this connection as feigned and completely ridiculous upon closer analysis.
Bontrup does not stop with a concise refutation. He bores deeper, takes up Marx' fundamental discoveries and focuses on the theory and politics of the neo-classical labor market. The theoretical conclusions are examined in the example of the Netherlands. This broad argumentation is convincing. After reading and study, no one can seriously argue labor markets are comparable with fruit-markets!
The question of the functioning of labor markets is embedded in concrete business praxis. Here Bontrup discusses the position and role of employees and analyzes management ideas. No lump-sum accusation is made. Rather Bontrup shows that management in pursuing short-term strategies works against its own long-term interests. Sooner or later, pure internal rationality leads to an economic short-circuit. This explanation serves as a basis for Bontrup's demand for more instead of less state as he formulates in the last political-economic chapter. While certainly not popular, this is economically justifiable.
Bontrup's analysis has great actuality since his political-economic demands largely coincide with those of the new Left party (DIE LINKE). The program of the left is often reproached for only being a wish-catalogue of world-changers and lacking any economic basis. With his book, Bontrup gives the economic context for the core demands of the Left party: taxation of businesses and the wealthy, protection against unlawful termination and joint-determination in businesses.
SCORING POINTS FOR DEMOCRATS
Bontrup's book will be seen as scoring points for a democratic conception of the economy in a productive conflict around correct analyses and strategies. His book argues beyond the neoliberal stream against the predominant opinion. Disregard threatens this work rather than productive conflict. Persons interested in economic questions will be richly rewarded with increased knowledge and argumentation competence.
Preface to Heinz-J. Bontrup's "Labor, Capital, and State"
[This foreword to the fourth edition of "Arbeit, Kapital und Staat. Plea for a Democratic Economy," 649 pagers, Koln 2011 is translated abridged from the German on the Internet.]
Much has happened in the economy and politics since the publication of the first edition in the spring of 2005. In September 2005, the second session of the Red-Green German government under Chancellor Gerhard Schroeder (SPD) ended prematurely and was superseded after the first Great Coalition of the CDU/CSU and the SPD (1966-1969) by a second Great Coalition. For the first time in Germany's history, a woman Angela Merkel (CDU) was the German chancellor. A political-economic rethinking and an improved development of welfare for all persons in Germany have not occurred. A disastrous neoliberalism is trusted. The "free market" is praised as a bringer of salvation for all things and the state discredited as a "bureaucracy- and tax monster" or as a "boarder" of the free enterprise profit economy. In its conversion, the 2005 coalition agreement "Together for Germany – With Courage and Humanity" led to a further redistribution from bottom to top… This and a weak economic growth amid continuing mass unemployment led to lower tax revenues of 247 billion euros between 2000 and 2008.
The Wealth-tax abandoned by the Black-Yellow German government in 1997 was not introduced again by the Red-Black German government and the inheritance tax reform amended in 2009 mock all description. The political goal of the Great Coalition was merely not to let the tax revenue from inheritances increase. In 2007, the value-added tax was raised to 19% especially burdening low incomes. Who can be surprised by the horrific increased division of society in poor and rich? The social chasm is becoming ever wider and deeper. Nearly every seventh citizen (15% of the population) was poor in 2007. The share would have been 24% without the social benefits of the state. The reason for this can be discovered quickly.
Mass unemployment has prevailed in Germany since the middle of the 1970s. Of the 60 postwar years, we can only look back to 12 years of full employment. This can only be described as a total system failure and as a political incapacity in fighting the "scourge" unemployment. In the economic upswing from 2006 to 2008, the registered unemployment declined from nearly 4.5 million to 3.3 million. There were around 1.2 million fewer unemployed. But if one looks more closely, nothing good remains of this good news. This decline was not caused by the creation of normal full-time jobs. These even decreased dramatically by two million. There is a boom with all kinds of poorly-paid work: part-time employment, one-euro-jobs, mini-jobs and temporary work were expanded enormously. (…)
The increase of employment beyond normal working conditions has meant that nine million work in the low wage sector – a quarter of all dependent employees" (Alternative Economic Policy study group 2009). In the economy, we have reached a state where people are poor despite full-time work in a 40-hour week and therefore must be subsidized by the state. This is because of the political expansion of the low-wage sector by neoliberal forces in a country that has its breeding ground in an enormous excess supply of labor (around 5 million jobs are lacking in Germany) and an intensified structural change toward the service sector.
Under these conditions, the unions are hardly able to negotiate comprehensive wage agreements, let alone realize real wage hikes oriented in productivity. Even urgently necessary collective reductions in working hours fall by the wayside in the wage negotiations. Paradoxically, employees in the economy and public administration should work longer not shorter hours for lower wages amid present mass unemployment. The unemployed are often described in a neo-feudal manner as "lazy" and "unwilling" who take advantage of the social state. Neoliberal policy fights the unemployed rather than unemployment. The "Black-Rose Pink" German government intensified the pressure on the unemployed to accept any conceivable exploitation job between 2005 and 2009 with three laws (Segbers 2009) instead of abolishing "Hartz IV" or raising its benefits enormously.
There was no progress in social policy under the "Black-Rose Pink" German government. Pensioners endured pension cuts for six consecutive years. In 2009, there was a pension increase for the first time of 2.41% (West) and 3.38% (East). Moreover raising the retirement age to 67 is both socially reprehensible and completely counter-productive on the backdrop of present mass unemployment. The pension cuts already resolved under "Rose pink-Green," will lead a large part of the population into old age poverty." No sustainable financing foundation for the legal health insurance was devised for the public health system with a "health fund." The health fund spares businesses and burdens the insured.
In education policy, claim and reality still diverge tremendously. Hardly anyone urges not spending more for education – at least in fancy speeches. Even the President of Germany, Horst Koehler (CDU) finally recognized that the German public education system is chronically under-funded. To raise education spending to the average of all OECD countries, Germany must spend 22 billion euros more every year and even 63 billion euros more annually to reach countries like Norway or Sweden. Too little was done in protecting the atmosphere. No adequate internalization of nature and its scarce raw materials occurs in the price calculations of businesses. The worldwide climate summit in Copenhagen failed miserably in national egoisms despite threatening climate catastrophes on account of CO2 emissions.
Then everything was eclipsed with the collapse of the international financial markets in the fall of 2008. The greatest world economic crisis since 1929 erupted. In 2009, the economic output, the real gross domestic product in Germany, decreased 5% as a consequence of the crisis. There had not been such a fall since 1949. Previously the greatest decline of the gross domestic product was 0.9% in 1975. The neoliberal forces and the media supporting them were shocked. The search for culprits was hectic. These culprits were quickly found. "Americans living above their means," their "expansive fiscal policy" and "irresponsible managers greedy for money" were accused. People were skillfully diverted by neoliberals from the true cause of the crises in the neoliberal redistribution class project since the middle of the 1970s. This class project has hit its own exploitation limits. More and more worldwide redistribution of income and wealth from the bottom to the top led to a massive inflation of the highly speculative financial markets – that were freed from nearly all state controls. In addition, a further development of privatization of social security systems occurred and additional capital poured into the financial markets through the savings.
With the outbreak of the crisis, neoliberals discovered Keynesianism, "Bastard-Keynesianism" (Joan Robinson) that helps private parties with state indebtedness. The state should intervene with "bailout umbrellas" in the billions for the crashing bank sector and cannot be a political-economic "night-watchman state" anymore. In many countries, banks were even nationalized for their rescue. In Germany, there was a special "nationalization law" for Hypo Real Estate (HRE), the most stricken of all banks. Three state economic packages against the enormous growth-collapse were offered. A legal expansion of short-time work was resolved to avoid a threatening mass skyrocketing of mass unemployment. So neoliberal "arsonists" became Keynesian "firefighters" overnight. But hardly anyone believed neoliberalism was at its end since it made itself felt again with a so-called state "debt brake." This was resolved and incorporated in the German Basic Law with the votes of the Great Coalition from the CDU/CSU and the SPD in the German Bundestag in June 2009 to contain the state indebtedness that logically rose through fighting crises. In the future, the German government can only become indebted at 0.35% of the gross domestic product and the country cannot become indebted after 2020. The consequences of this completely counter-productive measure are clear today. Future generations of politicians will be forced to a pro-cyclical economic policy. If they will not violate the Basic Law, the crises immanent in free enterprise capitalism will intensify and not be deactivated. The neoliberal forces in the country could now finally put the ax to the social state. Saving is imperative – for all the weak in the country. An even greater division in poor and rich will occur through the "debt brake."
The political discussions and conflicts in Germany became more vehement after the Bundestag election in September 2009 won by the CDU/CSU and the FDP. In a fatal way, the "middle-class camp" brought neoliberalism to the political stage again where market radicalism was emphasized, not state interventionism. Dependent employees, the unemployed, the socially weak and pensioners are saddled with the crisis burdens and entrepreneurs and the wealthy are given tax gifts once again. In the neoliberal style, the FDP demands more tax cuts – despite a gigantic increase in state indebtedness – and a co-pay in the public health system independent of income that could amount to a definitive de-solidarity. The "debt brake" could be a welcome instrument used for the further dismantling of the social state.
The author and publisher present the fourth edition of "Labor, Capital, and State" to make all this transparent and to show a fundamental political-economic alternative to "neoliberal monotony." All the chapters in the work were revised and brought up to date with empirical data. New political and economic developments since the 3rd edition (2006) were discussed and outdated findings left out. A chapter "On the Most Grievous Financial and Worldwide Economic Crisis in Eighty Years" was added to the fourth chapter "Economy and State in an Economic Democracy." A long environmental chapter "Nature is still not property considered today" was included. At the end of the book in a new 5th chapter, a conclusion takes up the essential building blocks of an urgently necessary conception of economic democracy.
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