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Keynesianism is no long-term solution to the economic crisis

 

 

By Lisbeth Latham

October 7, 2020 — Links International Journal of Socialist Renewal reposted from Revitalising Labour — The current COVID pandemic has caused massive financial damage to the global economy, damage which has been felt viscerally by working people in the form of dramatically reduced incomes and the loss of millions of jobs. As we progress through the pandemic and look hopefully towards its ending and eventual recovery, minds have begun to look towards what the eventual rebuilding of the economy might look like. Whilst capital, and its representatives in governments, are already looking towards an, even more, deregulated labour market and a general deepening of the neoliberal model, on the other hand, alternative models for recovery are being forward, most particularly that proposed the by the Australian Council of Trade Unions which draws its inspiration from the post-war recovery globally and most particularly in Australia post the Second World War. While this example has understandable appeal, it is well known, it refers to a period of massive and sustained economic growth. It is a deeply problematic model for recovery to the current period of crisis as it fails to understand the roots of the recovery post Second World War which will not be easily replicated but more importantly fails to recognise the broader reality of the global climate crisis that also confronts us, and which should mean we are wary of productivist solutions to this crisis.

Capitalism’s accumulation crisis prompts attacks on wages and organised labour

 

 

By Lisbeth Latham

June 22, 2020 — Links International Journal of Socialist Renewal reposted from Irish Broad Left — The central driver of the capitalist system is the drive for capitalists to constantly increase profits – failure to do so can be a trigger for a crisis within the capitalist system.

Since the end of the long boom in the early 1970s, capitalism, particularly in the advanced capitalist countries, has entered a period of long-run crisis under which individual capitalists have sought to find ways to continue to expand profits during a period of chronic over-accumulation.

This crisis has prompted the search for new avenues for profitable investment and the attempt to maximise returns on the existing capital in circulation. Despite sporadic periods of temporary growth, the past 50 years have been punctuated by regular national, regional, and global crises.

When oil markets go viral

 

 

By Adam Hanieh

April 11, 2020 — Links International Journal of Socialist Renewal reposted from Verso — The ecological dimensions of COVID-19 have become increasingly prominent in much recent discussion, with several important contributions exploring the pandemic in relation to capitalist agribusiness, widespread loss of biodiversity, and the destruction of natural ecosystems. There is, however, a further element to COVID-19’s ‘ecology’ that deserves much greater attention: the ways the escalating pandemic intersects with, and is simultaneously acting to accelerate, a profound shock to the fossil fuel industry. Global oil markets are undergoing an unprecedented transformation as a result of this shock, and while longer-term trajectories remain open, this moment will undoubtedly shape the politics of oil – and the prospects of mitigating climate change – for decades to come.

What do we mean by neoliberalism?

 

 

 

By Phil Hearse 

February 5, 2020 — Links International Journal of Socialist Renewal reposted from Mutiny — In the wake of Labour’s election defeat, the Blairite Right, and its intellectual outriders, have launched a sustained campaign against the Left and socialism. ‘The leadership’, ‘sectarianism’, ‘ideological purity’, and of course ‘anti-semitism’ are standard explanations of Labour’s defeat.

Part of this is a bad-tempered Observer article[1] by economist Will Hutton, in which he claims the word ‘neoliberal’ – applied to people or ideas – is just an ‘unthinking leftist insult’.

Will Hutton, it will be remembered, was the author of a sharp attack on Thatcherism, The State We’re In, published in 1996, and subsequently a strong advocate of Blairism.[2] He now claims the Left lost its battles against the Right in the last decade:

The coming economic crisis, “unorthodox” monetary policy, and Donald Trump

 

 

By Mike Treen

 

September 7,2019 — Links International Journal of Socialist Renewal reposted from The Daily Blog NZ — What is behind the “unorthodox” monetary policies of the US and other Central Banks?

 

There is much discussion today around how effective monetary policies are in regulating the ups and downs of the business cycle.

 

Monetary policies are run by the Central Banks of the respective countries with the US Federal Reserve operating like the world’s central bank. Their principal tools are the setting of certain interest rates they can control or influence and creating or reducing the supply of token money.

 

The US Federal Reserve resumed monetary creation policies earlier than expected at its July 30/31 meeting including a cut in what is known as the federal funds rate from 2.5% to 2.25%. They also halted the repurchase of the massive amounts of token money issued between October 2008 and October 2015 in response to the global financial and economic crisis of that time.

 

To understand what is happening we need to understand the interaction of three types of money in existence today.

 

The US-Turkey standoff in context: Global capitalism and the crisis of hegemony

 

 

By Vassilis K. Fouskas and Bülent Gökay

 

September 3, 2018 — Links International Journal of Socialist Renewal — Turkey was thrust into a full-blown currency crisis when United States President Donald Trump hoisted tariffs on Turkey’s steel and aluminium exports to the US — the country’s most serious crisis since President Recep Tayyip Erdogan’s Justice and Development Party (AKP) came to power 16 years ago. The Turkish lira lost more than 40% of its value in the first two weeks of August, albeit its most recent humble recovery. The pretext for Trump’s punishing attack on Turkey, the seventeenth largest economy in the world, is the continued detention of the evangelical US Presbyterian missionary Andrew Brunson who was arrested in October 2016 on charges of espionage and accused of involvement in the attempted coup of July that same year.

 

At first sight, the US-Turkey standoff appears to be a uniquely Turkish problem triggered by a very public confrontation between two leading members of the “ring of autocrats” of the 21st century and worsened by the idiosyncratic and often misguided economic approach of both leaders. This is not the case. One cannot look at the Trump-Erdogan conflict in isolation from the global situation.

 

Financial claims on the world economy

 

 

Reviewed by Tony Norfield

 

Finance Capital Today: Corporations and Banks in the Lasting Global Slump
By François Chesnais
Brill, Leiden, 2016

 

January 10, 2017 – Links International Journal of Socialist Renewal reposted from Economics of Imperialism – This book is well worth reading. It is written in a clear and accessible style and discusses key points about the limitations of capitalism and the role of contemporary finance. Perhaps its most important point is how the financial system has accumulated vast claims on the current and future output of the world economy – in the form of interest payments on loans and bonds, dividend payments on equities, etc. These claims have outgrown the ability of the capitalist system to meet them, but government policy has so far managed to prevent a collapse of financial markets with zero interest rate policies, quantitative easing, huge deficits in government spending over taxation, and so forth. The result is an unresolved crisis, a ‘lasting global slump’, in which economic growth remains very weak and vast debts remain in place.

 

European financial system: next crash just around the corner?

 

 

By Dick Nichols

 

November 1, 2016 — Links International Journal of Socialist Renewal — The trials of major European banks, starting with “venerable institutions” like the Monte dei Paschi di Siena (the world’s oldest bank) and Deutsche Bank (Germany’s largest), have raised the spectre of another 2008 — a “Lehman Brothers times five” in the words of one finance market analyst.

 

What is to be done with the banks? Radical proposals for radical changes

 

 

By John Weeks, Eric Toussaint, Stavros Tombazos, Pritam Singh, Benjamin Selwyn, Alfredo Saad Filho, Patrick Saurin, Sabri Öncü, Susan Pashkoff, Ozlem Onaran, Thomas Marois, Philippe Marlière, Francisco Louça, Stathis Kouvelakis, Andy Kilmister, Michel Husson, Michael Hudson, David Harvey, Pete Green, Giorgos Galanis, Alan Freeman, Gilbert Achar, Costas Lapavitsas

 

Plan B for Europe - Appeal to build a European area of work in order to end austerity and build a true democracy.

 

By Susan George, Yanis Varoufakis, Ada Colau, Zoe Konstantopoulou, Ken Loach, Noam Chomsky, et. al

 

January 19, 2016 - Links International Journal of Socialist Renewal reposted from Plan B Europa - In July 2015, we witnessed a financial coup d’état carried out by the European Union and its institutions against the Greek Government, condemning the Greek population to continue suffering the austerity policies that had been rejected on two occasions in the polls. This coup has intensified the debate over the power of the EU, and by extension it’s institutions, its incompatibility with democracy, and its role as guarantor of the basic human rights demanded by European citizens.

 

We know that there are alternatives to austerity. Manifestos such as “For a Plan B in Europe“, “Austerexit” or DiEM25 (Democracy in Europe Movement 2025) denounce the blackmail of the third memorandum of understanding imposed against Greece, the catastrophe that it would cause and the antidemocratic nature of the EU. The President of the European Commission no less, Jean -Claude Juncker, said : ” There can be no democratic decision against European treaties “.

 

China's slowdown foreshadows global slowdown

shrinking chinese economy

By Martin Hart-Landsberg

August 14, 2015 -- Reports from the the economic Front, posted at Links International Journal of Socialist Renewal -- China’s economy is dramatically slowing and this has significant consequences for world growth. The figure above provides a good visualisation of the slowdown and why official statistics likely overstate China’s current official growth rate of 7%.

Foreign investment retreats from Africa: Gaming, naming and shaming ‘licit financial flows’

Vast public subsidies may be pumped through the new “Programme for Infrastructure Development for Africa”

Click for more by Patrick Bond.

By Patrick Bond, Durban

August 10, 2015 – a version was first published in TeleSUR English, submitted to Links International Journal of Socialist Renewal by the author -- Foreign direct investment (FDI) is always prefaced with the two words ‘much needed”, my colleague Sarah Bracking insisted last week at a Zimbabwe NGO conference. “Have you ever heard FDI referenced without those two words?” We all shook our heads.

‘But the banks are made of marble...'

"But the banks are made of marble, with a guard at every door, and the vaults are stuffed with silver, that the worker sweated for ..." -- "The Banks are made of Marble" was written circa 1948 by Les Rice and recorded by Pete Seeger among others.

By John Rainford

July 2, 2015 – Links International Journal of Socialist Renewal -- Across Africa, western Asia and Latin America in the 1980s, the growth of per capita GDP was brought to a halt. This was not a recession, it was a severe depression, and its cause was profligate lending by banks in the 1970s.

In the 1960s, the Eurocurrency (as opposed to the euro) had been invented. US dollars deposited in non-US banks and held there in order to avoid restrictions of US laws became negotiable financial instruments that formed the basis for an unregulated market specialising in short-term loans.

In 1964 the market was estimated at US$14 billion, but by 1978 it was close to $500 billion after it became the chief mechanism for investing the massive oil profits of the Organization of Petrol Exporting Countries (OPEC) cartel, which managed to quadruple oil prices in 1973 and treble them again in the late 1970s. In 1970, the average price for a barrel of oil was US$2.53, in 1980 it was about $41.

Marta Harnecker: The origins of capitalist exploitation

For more by or about Marta Harnecker, click HERE.

By Marta Harnecker, translated by María Poblete and Federico Fuentes

April 17, 2015 -- Links International Journal of Socialist Renewal -- This text incorporates much of booklet #2 from the original series Cuadernos de Educación Popular (Booklets for Popular Education), which was titled “What is socialism?” and was written by Marta Harnecker in collaboration with Gabriela Uribe. This series was published in Chile during the Popular Unity government, lef by Salvador Allende, and was reprinted in various countries and languages. The text has been revised, some errors have been corrected, and supplementary examples and text boxes have been added, in order to make it easier to comprehend some of the complex ideas it tackles.

In this Booklet for Popular Education we hope to study the fundamental mechanism that explains why, under capitalism, you have a small group of people who possess a lot of wealth and enjoy an easy life, while a significant portion of workers find themselves in a very difficult situation.

Greece: Radical Eric Toussaint to audit Greek debt

Zoe Konstantopoulou (centre) with Eric Toussaint (right).

By Eric Toussaint, translated by Christine Pagnoulle and Vicki Briault

March 21, 2015 -- Committee for the Abolition of Third World Debt (CADTM), posted at Links International Journal of Socialist Renewal -- The president of the Greek parliament, Zoe Konstantopoulou, has set up a commission to audit the Greek debt and has asked me to play an active part in it. I have accepted the role to assume its scientific coordination.

This commission was launched on March 17, 2015, in Athens. |1|Recently the Athens correspondent for Le Monde wrote,

Mike Treen: Une critique de la théorie des crises

[English text and video at http://links.org.au/node/4156.]

Mike Treen, directeur national du syndicat Unite, explique pourquoi le capitalisme continue à connaître des crises aujourd’hui, et pourquoi ces crises vont se répéter avec une sévérité accrue jusqu’à ce que les travailleurs prennent le pouvoir et imposent une propriété, un contrôle et une planification démocratiques pour répondre aux besoins à la fois de l’humanité et de Mère Nature.

* * *

Links International Journal of Socialist Renewal – Ce qui suit est basé sur les propos de Mike Treen, directeur national du syndicat néozélandais Unite, à la conférence annuelle de l’organisation socialiste Fightback, qui s’est tenue à Wellington, 31 mai – 1er juin 2014, et un séminaire hébergé par Socialist Aotearoa le 12 octobre. Traduit par Gabriel Stollsteiner

Vincenç Navarro: Why Podemos is a big threat to Spain's political establishment

Pablo Iglesias, Credit: La Veu del País Valencià (CC-BY-SA-3.0)

Pablo Iglesias. Credit: La Veu del País Valencià (CC-BY-SA-3.0).

Click for more on Podemos and politics in Spain.

January 28, 2015 -- EUROPP – European Politics and Policy, London School of Economics, posted at Links International Journal of Socialist Renewal  -- Following SYRIZA’s victory in the Greek election on January 25, a number of commentators have turned their attention toward Spain, where the left-wing Podemos party, which originally emerged from the Indignados protest movement, has been receiving strong polling numbers since the end of 2014.

Here Vicente Navarro writes on the growth of Podemos and his role in shaping the party’s economic program. He argues that the anti-austerity and pro-democracy narrative put forward by Podemos has deeply resonated with the Spanish electorate, and that the party now poses a major threat to Spain's political establishment.

Greece: Yanis Varoufakis on the economic crisis and why he is standing for SYRIZA

Click HERE for more on SYRIZA.

January 13, 2015 -- Yanis Varoufakis, posted at Links International Journal of Socialist Renewal -- Beginning at 3.55 minutes, Yanis Varoufakis, professor of economic theory at the University of Athens, discusses the European economic crisis and expalins why he has chosen to be a SYRIZA candidate for parliament in the January 25, 2015, general election.

Has the International Monetary Fund reformed?

Click for more by Patrick Bond.

By Patrick Bond, Durban

December 22, 2014 -- TeleSUR English, submitted to Links International Journal of Socialist Renewal by the author -- In a Washington Post op-ed on December 17, 2014, "The IMF's Perestroika Moment", Boston University political economists Cornel Ban and Kevin Gallagher suggested "conventional wisdom" about the International Monetary Fund (IMF) is "outdated" because the IMF is no longer "a global agent of economic orthodoxy". Hmmm.

Social democracy and neoliberalism: victim or vanguard?

By Damien Cahill, Sydney

December 4, 2014 -- Damien Cahill: Thoughts on Politics, Economy and Culture, posted at Links International Journal of Socialist Renewal with the author's permission -- Earlier this year Ed Miliband, leader of the British Labour Party, addressed a specially organised gathering of business leaders with the following words: “I would be a prime minister who champions the rights of the consumer and the rights of businesses to succeed and make profits in a competitive market at the same time.”

That such sentiments could be expressed by a Labour leader in the neoliberal era is unremarkable. Social-democratic parties have been falling over themselves during the last few decades to reassure capital that, not only have they jettisoned their socialist inheritance, they are also firmly on board with the neoliberal agenda.

For British Labour, Miliband is just the latest in a series of leaders that have driven the party to embrace neoliberalism.

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