"When philosophy paints its grey in grey then has a shape of life grown old. By philosophy's grey in grey it cannot be rejuvenated but only understood. The owl of Minerva spreads its wings only with the falling of dusk." -- G.W.F. Hegel, 'Preface', Philosophy of Right.
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'Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainity and agitation distinquish the bourgeois epoch from all earlier ones ... All that is solid melts into air, all that is holy is profaned.' Marx
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systematic crisis + capitalism
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January 12, 2011
In The Enigma of Capital and the Crisis this Time David Harvey explores the idea of systematic crisis in relation to the internal contradictions of capitalism and the crisis of capital that began in 2007. he says:
Capital, Marx insists, is a process of circulation and not a thing. It is fundamentally about putting money into circulation to make more money. There are various ways to do this. Financiers lend money in return for interest, merchants buy cheap in order to sell dear and rentiers buy up land, resources, patents, and the like, which they release to others in return for rent. Even the capitalist state can invest in infrastructures in search of an improved tax base that yields greater revenues...A part of the profit, for reasons we will take up later, has to be capitalized and launched into circulation to seek even more profit. Capital is thereby committed to a compounding rate of growth.....So the problem for capital is to find a path to a minimum compound three percent growth for ever.
Since capital is a process not a thing, then the continuity of the process (along with its speed and geographical adaptability and mobility) becomes a crucial feature to sustaining growth. Any slow-down or blockage in capital flow will produce a crisis.
If capital flow stops then the body politic of capitalist society dies. ...When the banks stopped lending and credit froze in the wake of the Lehman collapse on September 15th, 2008, the survival of capitalism was threatened and political power went to extraordinary lengths to loosen the constrictions. It was a matter of life or death for capital as everyone in power recognized. Inspection of the circulation of capital reveals, however a series of potential blockage points any one of which could induce a crisis by constricting capital flow. Let us consider each of these.
When viewed as a whole, we see a series of potential blockage points to the circulation of capital, any one of which has the potentiality to be the source of a crisis.
There is, therefore, no single causal theory of crisis formation as many Marxist economists like to assert. There is, for example, no point in trying to cram all of this fluidity and complexity into some unitary theory of, say, a falling rate of profit. In fact profit rates can fall because of the inability to overcome any one of the blockages identified here. It is the task of historical materialist analysis to wrestle with the question as to where the primary blockages are this time around. But solutions at one point have implications for what happens elsewhere.
The fundamental theoretical conclusion is: capital never solves its crisis tendencies, it merely moves them around. This is what Marx’s analysis tells us and this is what the history of the last forty years has been about. No one now claims that the excessive power of labor is the source of the current problem as it was back in the 1970s. If anything, the problem is that capital in general and finance capital in particular are far too powerful and that the state cannot step in to re-balance affairs because it is captive – politically and economically – to capitalist class financial, rentier, producer and commercial interests.
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| | Posted by Gary Sauer-Thompson at 8:54 PM | Permalink |
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