28 November 2008
“The bourgeoisie [are] out of answers, and with the increasing costs of production and transportation driven by the price of oil, with the price of oil driving the bourgeoisie into greater capital expenditures to increase the rate of surplus value; with oil undermining growth in the mass and rate of value added– manufacturing, hidden beneath all the noise and clamor of Wall Street, of all the investment bankers at all the trading desks slapping themselves on the back with each new deal– manufacturing had all ready rung the closing bell.
“Those who didn’t hear it, couldn’t hear it. They were too smart. They were too stupid.
“The only answer left for capitalism…is the destruction of assets.” — ‘Pimp My Assets Part 3’, The Wolf Report.
So desperate are we for real change that Obama’s election promises became a veritable mantra for millions of people, especially the young, black and poor. Understandably, there is more than a little wishful thinking involved here given the disastrous decade we’ve been through. And after all the guy is young, apparently gifted and black, what more could anyone ask for?
However, a degree of realism is required and not only about Obama but concerning what is possible under the circumstances.
So what are the circumstances?
Firstly, there has been no radical shift of power in the US, the same Republicrats still rule, ‘bipartisanship’ is the order of the day. Obama was chosen by the ruling political elite so don’t expect miracles. Obama is first and foremost a politician with his eye on the prize, so let us disabuse ourselves of any notions we have that Obama will bring real change.
Immense forces, economic and political, have been unleashed by the financial crisis about which much has been written but none of the real causes, the real forces at work, have been revealed by the corporate press, not the least reason of which is the fact that they dare not explain what is going on.
Neo-liberalism lit the fuse but the bomb was well-primed and asset-destroy they have, the latest figure is around $8.5 trillion, a lot of moola and this is just the United States. Who knows what the global figure is.
“[The $8.5 trillion is] coming from two sources which ultimately comes back to us the tax payer.” These two sources are the Federal Reserve which is using undisclosed bonds for collateral leading to a short fall of money coming in to the treasury department, and national debt interest.
“Prins touches on the fact that until the potential asset losses within the system are disclosed, no effective progress can be made, “In the end…the simple infusions of capital…will not work unless it’s done to the amount of potential loss that is in the system””. — ‘Bailout cost $8.5 trillion’ Real News Network
This means that the $8.5 trillion has to be sucked out of the real economy, which means lay-offs, cuts in social spending and eventually tax increases.
Companies, large and small are going belly-up daily, never mind the banks, the real economy has reached a dead-end for without credit and worse, without a job, what’s a consumer to do?
Thus to expect Obama or even the entire US government to actually reverse the process set in motion by the over-accumulation of capital is akin to trying to stop a fully laden oil tanker by sticking your foot out.
Thus, the forces of accumulation must—they have to—run their course. Past crises have led to major wars, a sure-fire method of destroying assets, material and human. Is such a course of action the inevitable outcome of this, possibly the greatest crisis capitalism has ever faced?
Well nothing in human affairs is inevitable, all depends on how we, the people, respond and herein resides the Achilles Heel of Barack Obama, for having promised us real change, he is now faced with the impossible task of delivering. Frankly, I don’t envy him, for sooner or later, he will be revealed as having no clothes.
Unfortunately, this no consolation, it solves nothing knowing that Obama is without substance, in some ways like the nameless character of Ralph Emerson’s novel ‘Invisible Man’. Cut adrift, without class or ‘race’ solidarity, without any sense of history, where we have come from or even how we got here,
“At his new job, the character is instructed to add ten drops of a black liquid to a can full of discolored paint. After the paint is shaken, the main character peers into the can and beholds a “pure white” paint. This allusion hints at the mindset of Americans at those times, an addition of ten drops of indoctrination to the African-American soul can instill in him the love of white America; or it could illustrate that what is considered “pure white” isn’t exclusively white. This is also a vague reference to Jim Crow-era laws that were based on the percentage of “black blood” one had in order for such to apply.” — From a description of Ralph Ellison’s ‘Invisible Man’
It’s bordering on the existential, a crisis without a credible explanation or apparently a resolution, ‘care-takered’ by the US’s first black president, who in turn, seems to be the reincarnation of Bill Clinton. What is going on here?
It points to a world where image is everything and substance, nothing, even the burning issue of race suddenly becomes transparent. The world has became the nameless, voiceless victim of the over-accumulation of capital. We are reduced to gladiatorial spectators who end up being thrown to the lions.
“American unions lost more than nine million members over the past 30 years, with union density slipping to 12.5 per cent overall and a measly 7.4 per cent in the private sector. In the U.K., meanwhile, unions saw their numbers decline by over six million and union density fall by almost half to 29 per cent over the past 25 years. In both countries organizing is at a standstill, with certification of new workers at less than 20 per cent of the number required even for unions to maintain their current numbers.” — ‘Too little too late? The State of the Canadian Labour Movement Today’, John Peters, The Bullet.
And while we’re on the business of throwbacks, until we rediscover our class, we are truly powerless.
“Twenty years ago, business used to finance itself from commercial bank loans. Now with governments reforming financial and corporate governance systems, business has taken the bulk of its financing from bond and stock markets – the new “shareholders” in global capitalism.
“The results have been disastrous. Focused on driving down costs and maximizing the flow of profits to stockholders, multinational corporations have sought to put the brakes on labour rights, and to push back any and all gains labour made in the post-war period.
“International operations like General Motors have used debt to finance takeovers the world over, and then engaged in massive cost-cutting through shutting plants, laying off workers, and cutting wages, all the while opening more non-union operations in cheaper regions around the globe.” (ibid)
But with the crisis of finance capitalism even this has now ground to a halt, which brings me back to where I came in: the only ‘solution’ is the destruction of assets and we are powerless to stop it simply because we have no collective voice, either through unions or political parties.