Volume
53, Number 11 | April 2002
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Volume
53, Number 11 | April 2002 |
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The New Face of Capitalism » As this special issue on the economy goes
to the printer, the business press is full of the news that a mild recovery
from the recession that began in March 2001 may already be in the works, as was
suggested by Federal Reserve Chairman Alan Greenspan in testimony to Congress
in late February. Whether this should prove to be the case or not, it remains
true that the long-term, deepening problems of the U.S. economy are for the
most part ignored in such accounts, in favor of a short-run focus on an
expected cyclical upswing. REVIEW
OF THE MONTH For a long time now, the U.S. economy and the economies of the advanced capitalist world as a whole have been experiencing a slowdown in economic growth relative to the quarter-century following the Second World War. It is true that there have been cyclical upswings and long expansions that have been touted as full-fledged “economic booms” in this period, but the slowdown in the rate of growth of the economy has continued over the decades. Grasping this fact is crucial if one is to understand the continual economic restructuring over the last three decades, the rapidly worsening conditions in much of the underdeveloped world to which the crisis has been exported, and the larger significance of the present cyclical downturn of world capitalism. The Argentine
Crisis Historically, monetary crises have been related to hyperinflation, from which Argentina has often suffered. Hyperinflation is generally viewed as a calamity leading to the destruction of the capitalist monetary system of circulation. In the present Argentine crisis, however, there has been a complete implosion of economic and monetary relations due to hyperdeflation. This is the strangulation of the economy by the requirement to pay an unsustainable debt. DOCUMENT "There is no alternative" has always been wishful thinking at best, at worst a deliberate lie, on the part of the ruling powers. From out of the ruins to which neoliberalism has brought Argentina, its onetime much-heralded model of success, now come the unsilenced voices of radical economists. We present here an English translation of a proposed alternative solution to the Argentine crisis. The proposal was set out on January 24, 2002, by Argentine economists as a starting point for discussion within the emerging popular movement.—The Editors Neoliberal Finance and Crisis in the
Developing World The Mexican financial implosion of 1994-1995 marked the beginning of a parade of financial crises throughout the developing world that today shows no signs of abating. From the Asian crises of 1997-1998, to Russia and Brazil shortly thereafter, to Turkey in early 2001, and Argentina today, financial instability has swept through those developing countries that have embraced neoliberal financial reform. Former International Monetary Fund (IMF) Managing Director, Michel Camdessus, had it right when he dubbed the Mexican debacle the "first financial crisis of the twenty-first century." What he didn't understand was that the neoliberal financial regime that his institution had installed throughout the developing world contributed to the very turbulence that he lamented. Economic Crisis and the Crisis of U.S.
Labor Capitalist economies have always moved in cycles of expansion and contraction. They are crisis prone by their nature. The U.S. economy expanded for ten years, from 1991 until the spring of 2001, and, as is normally the case during such a long expansion, the pundits began to argue that the economy had overcome any tendency to contract and that prosperity could go on forever. Even Alan Greenspan seemed to think that uninterrupted growth was possible, provided, of course, that he remained at the helm of the Federal Reserve. In the end, however, the good times came to an end, as they always do. An economic crisis, like any kind of crisis, always has class dimensions. Workers are inherently more vulnerable than employers, so they will suffer more when the economy falters. As the current crisis has begun to unfold and deepen, what has happened to working men and women in the United States? What might happen as the crisis continues? What has been and is likely to be the effect of the September 11 attacks and the ensuing "war on terrorism" on the economic conditions of workers? CORRESPONDENCE The Social Forum (SF) which took place in Porto Alegre, Brazil on February 1-5, 2002 attracted nearly 70,000 participants, including over 15,000 delegates from almost 5,000 organizations. Delegates came from 150 countries to participate in twenty-eight conferences, 100 seminars and 700 workshops. Over 3,000 journalists from radio, TV, newspapers, and magazines covered the event. As the first major anti-neoliberal globalization event since September 11 and the assault on Afghanistan, the SF refuted the Bush-Rumsfeld propaganda line that the people of the world had to choose between U.S. imperialism or Islamic terrorism. |
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