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economics

A century since Hilferding’s `Finanz Kapital' -- again, apparently, a banker’s world?

By Patrick Bond

November 19, 2010 -- Links International Journal of Socialist Renewal -- The power and reach of financial institutions, not to mention the resulting superprofits, are the source of widespread, often extreme frustration. Industrialists, small businesspeople, government leaders, workers, consumers, environmentalists, the Greeks and Irish (and similar Third Worlders), and indeed all debtors have suffered usurious, speculative or bailout-related decimation of their resources over the past thirty years.

A shared critique of banks today, we’d all agree, includes: too much control, too much out-of-control investing, and too much revolving-door crony capitalism connecting financiers to state “regulators”, of which the Wall Street-Washington crew appear the most corruptly profligate.

Currency wars and the privilege of empire

By Paul Kellogg

October 23, 2010 -- PolEconAnalysis -- In uncertain times, the headline was soothing: "Secretary Geithner vows not to devalue dollar".[1] United States Secretary of the Treasury Timothy Geithner was saying, in other words, that if there were to be "currency wars" -- competitive devaluations by major economies in attempts to gain trade advantage with their rivals -- the United States would not be to blame. Who, then, would be the villain? China, of course.

Earlier this year, Democratic Party congressman Tim Murphy sponsored a bill authorising the United States to impose duties on Chinese imports, made too inexpensive (according to Murphy and most other commentators) by an artificially devalued Chinese currency. "It's time to deliver a strong message to Beijing on behalf of American manufacturing: Congress will do whatever it takes to protect American jobs."[2]

Grameen Bank and `microcredit': The `wonderful story' that never happened

Mohammad Yunus accepts the 2006 Nobel Peace Prize.

Far from being a panacea for fighting rural poverty, microcredit can impose additional burdens on the rural poor, without markedly improving their socio-economic condition, write Patrick Bond and Khorshed Alam.

October 21, 2010 -- Pambazuka News -- For years, the example of microcredit in Bangladesh has been touted as a model of how the rural poor can lift themselves out of poverty. This widely held perception was boosted in 2006 when Mohammad Yunus and Grameen Bank, the microfinance institution he set up, jointly received the Nobel Peace Prize. In South Asia in particular, and the world in general, microcredit has become a gospel of sorts, with Yunus as its prophet.

Consider this outlandish claim, made by Yunus as he got started in the late 1970s: "Poverty will be eradicated in a generation. Our children will have to go to a `poverty museum' to see what all the fuss was about."

The limits to energy efficiency under capitalism

By Simon Butler

October 9, 2010 -- Green Left Weekly -- It is close to an article of faith among environmentalists that using less energy is a big part of the solution to climate change. Energy efficiency is often said to be the “low hanging fruit” of climate policy. On face value, the benefits seem obvious.

The knowledge needed to make big gains in efficiency already exists. Using less energy will save consumers and industry money, whereas other policies will be costly. And most importantly, lower energy use could make a big dent in global greenhouse gas emissions.

The UN Intergovernmental Panel on Climate Change and the International Energy Agency both promote energy efficiency as an important climate measure.

However, strong evidence has emerged that new energy efficient technologies alone won’t do much to cut emissions. Indeed, in a capitalist economy, it’s very likely that energy efficiency gains will lead to higher energy use, not less.

Alex Callinicos on imperialism, two reviews

Review by Barry Healy

Imperialism and Global Political Economy
By Alex Callinicos
Polity, 2009
227 pages

October 2, 2010 -- The topic of “imperialism” greatly occupied the minds of late-19th and early-20th century socialists. Some of the tradition’s greatest minds toiled mightily to discern the fundamental changes in capitalism that were occurring before their eyes.

Capitalism, as analysed by Karl Marx, had grown fat in its European heartland through the ruthless exploitation of colonies and the brutal factory system in its coal dark cities. But suddenly new phenomena started to appear in the late 1800s.

Banking capital moved from being a support for industrial capital, first merging into and then dominating manufacturing. This agglomeration of money power created massive industrial complexes, like Germany’s famous Krupps steelworks.

The colossal scale of these industrial works dwarfed human beings.

Exclusive excerpt from `Debt, the IMF and the World Bank: Sixty questions, sixty answers', by Éric Toussaint and Damien Millet

September 12, 2010 -- Links International Journal of Socialist Review, with the permission of Monthly Review Press, is delighted to make available an excerpt from Éric Toussaint and Damien Millet's new book, Debt, the IMF and the World Bank: Sixty questions, sixty answer. You can download the excerpt in PDF format HERE, or read it on screen below.

Links readers are urged to purchase a copy of the book. To order your copy, please click HERE.

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(Updated Sept. 8) Raj Patel: Food rebellion -- Mozambicans know which way the wind blows

Democracy Now! on September 8 spoke to Raj Patel about the protests in Mozambique and the floods in Pakistan. Click HERE for the full transcript.
 
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* * *STOP PRESS: Price rises reversed* * *

September 7, 2010 -- MOZAMBIQUE News reports & clippings mailing list -- Price rises which triggered the riots last week have been reversed, the government announced September 7 after an emergency cabinet meeting.

Is Africa still being looted? World Bank dodges its own research

Oil riches and poverty in the Niger Delta.

By Patrick Bond

August 15, 2010The continent’s own elites, together with the West and now China, are still making Africans progressively poorer, thanks to the extraction of raw materials. Reinvestment is negligible and the prices, royalties and taxes paid are inadequate to compensate the wasting away of Africa’s natural wealth. Anti-extraction campaigns by (un)civil society are the only hope for a reversal of these neocolonial relations.

Though it’s easy to prove, even using the World Bank’s main study of natural resource economics, the looting allegation is controversial. When I made it during a Canadian Broadcasting Corporation (CBC) interview last week, the World Bank’s chief economist for Africa Shanta Devarajan, immediately contradicted me, claiming (twice) that I am not in command of the “facts”.

Karl Polanyi provides `a vital intellectual resource' for ecosocialists

To allow the market mechanism to be sole director of the fate of human beings and their natural environment, indeed, even of the amount and use of purchasing power, would result in the demolition of society. For the alleged commodity "labor power" cannot be shoved about, used indiscriminately, or even left unused, without affecting also the human individual who happens to be the bearer of this peculiar commodity. In disposing of a man's labor power the system would, incidentally, dispose of the physical, psychological, and moral entity "man" attached to that tag. Robbed of the protective covering of cultural institutions, human beings would perish from the effects of social exposure; they would die as the victims of acute social dislocation through vice, perversion, crime, and starvation. Nature would be reduced to its elements, neighborhoods and landscapes defiled, rivers polluted, military safety jeopardized, the power to produce food and raw materials destroyed -- from Karl Polanyi's The Great Transformation (1944)

iPhone 4: Capitalism, inbuilt obsolescence and `blood' phones

The high demand for coltan is helping fuel the bloody civil war in the Democratic Republic of Congo as rival armies fight over reserves.

By Stuart Munckton

August 1, 2010 -- Green Left Weekly -- “Yes, the notable features with iPhone 4 — both the device and the iOS4 — are mostly tweaks”, said a June 22 review on the popular site BoingBoing.net. “But what tweaks they are.”

In the interests of full disclosure, I’ll admit I have no idea what “iOS4” means. But my eye was caught by the admission that the iPhone 4, launched in Australia on July 29, was almost the same as the iPhone 3.

Corporations use “inbuilt obsolescence” as part of artificially creating markets. This means the products they sell are deliberately made to break down — so we have to keep buying more.

In the case of products tied to ongoing innovations, the trick has a variation. Makers will hold back innovations in order to release, a short while later, a new version of the same product with a few extra features.

Is `de-growth' compatible with capitalism?

Photo by Twaize/Flickr.

By Alejandro Nadal

July 15, 2010 -- TripleCrisis -- A serious campaign in favour of “de-growth” has been going on for some time and has made important contributions. This movement has opened new avenues for debate and analysis on technology, credit, education and other important areas. It’s an effort that needs support and attention, and we must applaud their initiators and promoters for their boldness and dedication.

The debate on the rate of profit

By Michel Husson

July 2010 -- International Viewpoint -- A polemic on the rate of profit has developed over the last few months. This article seeks to review this debate which turns around four essential questions. [1]

The four questions are:

  1. an empirical question: what has been the evolution of the rate of profit since the early 1980s in the big capitalist countries?
  2. a theoretical question: what is the status of the tendential fall in the rate of profit in the Marxist analysis?
  3. a “semi-theoretical” question: what is the nature of the crisis?
  4. a programmatic question: what is the impact of this discussion on the proposals advanced in the period opened by the crisis?

The evolution of the rate of profit

Classic cartoon by Fred Wright: `How much do you pay your boss?'

Drawing on the American Labor movement -- Fred Wright (1907-1984) was one of the United States’s most renowned labour movement cartoonists. His career lasted from 1939 until his death in 1984. He is best known for his work as a staff cartoonist for the United Electrical, Radio and Machine Workers of America (UE). In addition to his cartoons illustrating the union’s newspaper, the UE News, he designed leaflets, strike placards and animated organising cartoons to contribute to the US labour movement. 

Wright sold his first cartoon to the National Maritime Union (NMU) publication, The Pilot, in 1939. He continued to draw cartoons for the US Army during World War II and was ultimately hired as a staff cartoonist for the UE in 1949. Throughout this time, his work was reprinted in labour and radical publications worldwide. In the spirit of the labour movement, his cartoons criticised the Taft-Hartley Act, McCarthyism, and other government post-war attacks on trade unions.

Video: David Harvey -- `The animated crisis of capitalism'

On April 26, 2010, Marxist geographer professor David Harvey spoke to the the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) to explain how capitalism came to dominate the world and why it resulted in the current financial crisis. He asks: is it time to look beyond capitalism towards a new social order? Above is the animated version of the longer speech he gave. You can view the original speech HERE.

Taking a long view of the current crisis, Harvey exposes the follies of the international financial system, looking closely at the nature of capitalism, how it works and why sometimes it doesn’t.

Toronto G20: `Toxic remedies' will make workers and poor pay for the crisis

By Damien Millet, Sophie Perchellet and Eric Toussaint. Translated by Christine Pagnoulle and Marie Lagatta

June 28, 2010 -- Committee for the Abolition of Third World Debt -- As at its previous meetings, the Toronto summit of the exclusive G20 club, to which the world’s richest countries invited the heads of state of the major emerging countries, once again raised great expectations only to end as an empty bubble. As in London in 2008, then Pittsburgh in 2009, the Toronto G20 discussions focused on a way out of the economic crisis. But a capitalist way out, favouring creditors and great powers.

For the last two years global financial regulation has been an elusive sea serpent, unsurprisingly resulting in no concrete measures. To appease their citizens who pay a high price for the consequences of the present crisis, although they bear no responsibility for it, governments pretend they are trying to redefine the rules in the global financial game whereas for decades they have promoted the cancellation of any rules that would protect the world’s peoples.

Video: David Harvey -- `The crises of capitalism'

On April 26, 2010, Marxist geographer professor David Harvey spoke to the the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) to explain how capitalism came to dominate the world and why it resulted in the current financial crisis. He asks: is it time to look beyond capitalism towards a new social order?

Taking a long view of the current crisis, Professor Harvey exposes the follies of the international financial system, looking closely at the nature of capitalism, how it works and why sometimes it doesn’t.

Krise i Hellas – reaksjonær understrøm i Europa

Av Paul Kellogg

Den voksende massebevegelsen og åpningen mot venstre i Hellas er oppmuntrende.
Det er i den bevegelsen det ligger håp om at det en gang kan vokse fram et virkelig progressivt Europa.

Olivier Besancenot: `We are all Greek workers!'


General strike, Athens, May 20, 2010. Photos by the Communist Party of Greece (KKE). Made with Slideshow Embed Tool

By Olivier Besancenot and Pierre-François Grond, translated by Richard Fidler and Nathan Rao

May 14, 2010 -- Le Monde via The Bullet -- The events in Greece concern us all. The Greek people are paying for a crisis and a debt not of their making. Today it is the Greeks, tomorrow it will be others, for the same causes will produce the same effects if we allow it.

Greek crisis reveals ‘progressive’ Europe’s reactionary stew

By Paul Kellogg

May 3, 2010 -- The bailout of the debt-ridden Greek government seems finally to be complete. The European Union (EU) – most centrally the French and German treasuries – along with the International Monetary Fund (IMF) will provide €110 billion ($150 billion) in emergency loans. The price for these loans will be high. Along with steep tax increases and cuts in spending, the loans are conditional on a public sector wage freeze being extended through to 2014.[1] This is in reality a wage cut, as there will be drastic changes to the so-called “bonuses” – holiday pay that has become an essential part of the income package of low-paid public sector workers.

The anger at these cuts is everywhere in Greek society. Giorgos Papadapoulos is a 28-year-old policeman who normally confronts demonstrators. But in March he put aside his riot shield and joined the mass protests which have become a regular part of life in Greece. “It’s a different feeling for me”, he told journalists while he was on the demonstration. “But this is important. It hurts me and my family.”[2] However, the crisis in Greece has revealed not just a shift to the left in Europe. It has also brought to the surface a seamy reactionary underside to politics in the EU portion of the Eurasian landmass.

Europe: Solidarity with the resistance of the Greek workers (updated May 9)

Greek workers stage general strike, March 2010.

April 30, 2010

1. The global economic crisis continues. Massive amounts of money have been injected into the financial system – US$14 trillion in bailouts in the United States, Britain and the eurozone, $1.4 trillion in new bank loans in China last year – in an effort to restabilise the world economy. But it remains an open question whether or not these efforts will be enough to produce a sustainable recovery. Growth remains very sluggish in the advanced economies, while unemployment continues to rise. There are fears that a new financial bubble centred this time on China is developing. The protracted character of the crisis – which is the most severe since the Great Depression – reflects its roots in the very nature of capitalism as a system.

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