Building the post-capitalist economy

Post-capitalist economy? - that old chestnut, a socialist arguing for the end of capitalism? But in recent times capitalism has shown that it is perfectly capable of bringing about its own demise. This isn't just about the collapse of banks, the current 'debt crisis' obscures and compounds the real problem which is the collapse of ecosystems on which we depend for our survival. Capitalism is not just the driver of climate change, but also of massive environmental degradation, and loss in biodiversity - see this recent example. It is capital accumulation that is devouring our planet and you cannot use the same mechanisms which are destroying the Earth to save it. What we need to do is bring about economic change before the consequences of climate change become unimaginably destructive to our global society. A post-capitalist economy is inevitable, but we can do it the hard way or the better way, and what we need to do is think about how that economy ought to work.

This is a slight detour, but I wonder how many people know that Karl Marx, was an admirer of capitalism, in the sense that he admired the huge productive capacity of capitalism, which far exceeded any previous economic system. Marx recognised that if the productive capacity of capitalism was harnessed for the good of society, it could provide people with a much better material standard of living than they had ever had before. But he also recognised that, through the mechanism of surplus value, capitalists were able to deprive workers of the wealth that they created, and that there would always be a conflict between capitalists and workers, between the productive forces - workers - and the non-productive forces - capitalists. Marx was the first political economist to understand the massive forces that capitalism could unleash, and Marx and Engels were also much more aware of environmental degradation than they have been given credit for. Engels said:    

Let us not, however, flatter ourselves overmuch on account of our human victories over nature. For each such victory nature takes its revenge on us. Each victory, it is true, in the first place brings about the results we expected, but in the second and third places it has quite different, unforeseen effects which only too often cancel out the first.

As far as climate catastrophe is concerned, the left may have led the way in our understanding of the unfolding crisis but the 'free' market right have since caught up, and are now pouring their millions into persuading people that climate change is not an issue, through climate change denial, because they are concerned about their profits and the end of domination of democracies by the market. As I have pointed out before, in this post, the 'free' market fundamentalists are fighting to deny climate change precisely because they recognise that a genuine and meaningful response the climate change will mean the end of capitalism as we know it. This state of affairs was beautifully summed up in an article by Naomi Klein called 'Capitalism vs the Climate'.

So what would a post-capitalist economy look like? It would not mean the end of the private sector, because, as I've argued before, the private sector is not the same thing as capitalism, but initially it would inevitably mean a much bigger role for the state because a collapsing capitalist economy would have to be replaced by extensive nationalisation of banks, transport and utilities to save them from going under. Energy and food production would have to be regulated as would imports and exports. We would need planning in a democratically controlled economy.This would not simply be an ideological choice but a necessary response to crisis. We would have to grow as much as our own food as possible and economies would become much more localised. It would be an economy much more like the one that we had in the UK during the Second World War.

Caroline Lucas in her report 'New Home Front' has gathered together ideas on what we can do in response to climate change

We are already beginning to experience problems with climate change in terms of freak weather events, and disruption to agriculture, and we will inevitably soon experience difficulties with energy supply. We have a choice, we can begin to adjust our economy now, to deal with these problems, or we can carry on with 'business as usual' and inevitably face much worse conditions later. What we need to do is forget about the 'free' market neoliberal nonsense about competing with China, and work together to create a new kind of economy to deal with possibly the greatest challenge that human beings have ever faced.

'Free market' capitalism is just a racket

As the 'free' market fundamentalists of the neoliberal right continue their class war mission to drag us all back to nineteenth century conditions its becoming clearer that the 'economic policy' they support is little more than a racket. Before I describe this, its worth considering one of the central problems of capitalism - the falling rate of profit. In the nineteenth century many economists accepted that there was a tendency of the rate of profit to fall over time and Marx explained how that worked in Capital. Of course, Marx's theory has since been disputed, but not disproved. Nevertheless, by the 1970's, after the post WW2 boom profits were beginning to fall. The solution? - neoliberalism. Neoliberalism works by screwing workers, including middle class workers, harder, and reducing their living standards. Quite simply capitalists take a bigger slice of the cake, leaving ever fewer crumbs for the rest of us.

That is why our pensions, wages, and working conditions have been under attack for the past 30 years. The politicians who have been doing this to us have invented a series of plausible 'excuses' for doing so. In the case of pensions the 'excuse' is demographics, people are living longer, and so they are, but decent pensions are still affordable, the real reason they are being removed from us is to increase profits for corporations.

This is also the reason why our current reactionary neoliberal coalition government are so keen on privatising the NHS and public services - guaranteed profits. The corporations know very well that public services are an easy risk-free way of making guaranteed profits and they have long wanted to take control of them. With austerity and the most reactionary government in half a century in power their chance has come. In the UK this privatisation drive began with Thatcherism in the 1980's well before the current government, with the 'excuse' that the private sector was more efficient and would deliver better services. We have seen what has happened with the railways and energy. Large corporations making vast profits out of the taxpayer and customers (who used to be stakeholders) with none of the promised improvements. The economic crisis we are in, created by neoliberal 'economic policy' has now enabled the whole project to be pushed further and harder than it ever has been in the past 30 years.

We have reached the stage whereby public services are being handed over by our politicians to profit makers without any regard for supposed efficiency. This is nothing more than the imposition of 'free' market ideology and has become a racket, with guaranteed profits for the corporate winners. Here are a couple of examples I have recently come across, but there are many more. In the USA corporations are 'offering' to take over publicly run prisons as long as there is a minimum of a 90% occupancy rate. Just think about that. That means that the public bodies are going to have to find more prisoners to fill those jails! I guess they will just have to search harder for lawbreakers, and find sympathetic judges.

Meanwhile, in the UK A4e, a company which is supposed to help people back into work, is now under investigation for fraud, for allegedly fiddling its figures to get taxpayers money. The founder, Emma Harrison, paid herself £8.6 million last year. But this person is the darling of government, held up as an example of entrepreneurship to us all. A4e is built entirely around government contracts, that is taxpayers money, at least £8.6 million of which has been wasted in my view. That money could have been used to create jobs.

As long as our politicians are hand in glove with the corporations, we can expect more corporate welfarism and cosy deals carving up public services to continue. No risk-taking and no efficiencies -  except for lower wages and worse conditions for the workers who are expected to deliver. Even Tory MP David Davis has condemned 'crony' capitalism, but In fact, this is barely capitalism, its more akin to a form of neo-feudalism where the political barons and capitalist kings conspire to keep the rest of us in perpetual wage serfdom.

What is Socialism?

We live in reactionary times. Times, in which, the political left appears to be unable to respond to the dominance of the political right. Capitalism is everywhere triumphant. The left is in crisis. So what has happened?

Firstly we need to go back to 1989 the year in which the Soviet Union collapsed. The champagne corks must have been popping in every capitalist boardroom. Why? because as long as the Soviet Union existed it was possible to believe in a viable alternative to capitalism. That gave the left an awful lot of strength. There isn't the time and space here to go into the pro's and cons of the Soviet Union. Was it really a workers state? Was it state capitalism? Was it just a brutal dictatorship? Suffice to say the Soviet Union was not a bad as Western Capitalist propaganda made it seem. People had housing and healthcare and it was a much more equal society than anything we have ever experienced. An awful lot of good people gave their lives trying to create a better world. Their efforts deserve to be acknowledged.

But back to the left. After 1989 it became seized with doubt - trapped like a rabbit in the headlights of the oncoming capitalist juggernaut. But how did things fold so easily? I think there are a number of reasons. One key one is the fact that a lot of the old Marxists and Socialists, people like E P Thompson simply died out. The people who replaced them didn't have the experience of war, conflict and struggle that those those old Socialists did, they were tough cookies. Socialists had gone soft and Socialist politicians in Europe had been sucked into the Eurocracy, expense accounts, and (largely) meaningless debates in Strasbourg.

So where do we go now? What next for the left? Well socialism of course! But hang on isn't that a bit 20th century? Isn't socialism dead as Martin Kettle claimed recently? Well no it isn't. Broadly speaking there are two kinds of socialism; Socialism with a big 'S' and socialism with a small 's'. Socialism with a big 'S' - the Socialism that arose from the work of people like Marx, Engels and Lenin. By the the late 1960s Socialism had become dogmatic, doctrinaire and sterile That does not mean that Marx, for example, was dogmatic, just that Socialism had become riddled with a particularly deadening kind of dogmatism. Socialism had ceased to be empowering and vibrant. Changing economic circumstances and disillusionment with the Soviet Union helped to bring about the decline of this mainstream Socialism.

But socialism with a small 's' is, and always has been, alive and well. Socialist ideas pre-date Marx by a very long time. Wat Tyler was a socialist, so was John Lilliburne. Because socialism with a small 's' is simply the politics of putting people first - of need not greed. You don't need to have read Das Kapital to understand that kind of socialism - anyone can.

Of course Socialism is so unpopular that some people believe the 's' word should never be mentioned. If they can think of a better word to describe the politics of need not greed then I'd like to hear it. 'Progressive' politics just isn't enough. If David Cameron can call himself a progressive - he's not really - then that's a good reason for not using the word. The fact that Cameron would never dream of calling himself a socialist is good enough for me.

To be honest I'm glad that doctrinaire Socialism is dead. Too much focus on theory, rather than practice, too much self indulgence, too many varieties, too many meetings, too much sectarianism - too much baggage by half. We need to learn from the mistakes that Socialists made in the past without underestimating the great value and contribution of socialists like Marx. We need to unite and move forward with the simple politics of social, economic and environmental justice. That's what socialism, at its core, is really about.