Back in 1972, when one of us was living in Toronto, the Canadian national hockey team played a series of much publicized games against the Soviet Union. Horror of horrors, the Soviet team started winning. The defeat of Canada’s favorites at its own national sport, and, worst of all, at the hands of Communists, was an occasion for some deep national soul-searching in the mainstream press. There were some astonishing editorials, which came very close to questioning the fundamental values of capitalism if it could so weaken the moral fiber of Canadians as to lead them to defeat by the Communist adversary at their very own game.
We hope that the analogy we’re about to draw won’t seem frivolous, but something that’s been happening in the Western press in recent months has brought that old episode to mind. It needs to be said, first, that, while Canada certainly played its own not so glorious part in the Cold War, it has at least had something like a social democratic party in the political mainstream, and socialist ideas have never been seen there as quite so alien and dangerous as they are in the United States. So maybe it doesn’t take quite as much in Canada to provoke reflection on the weaknesses of capitalism as it does in the United States. At any rate, in the United States it does take something close to collapse of the global economy to get “opinion leaders” to think the unthinkable: that capitalism may not be all it’s cracked up to be.
Well, we seem to be there now. Who would have thought, even a few months ago, that we would hear the kinds of things we’re hearing now from Wall Street and the conservative press, not just about the worst global crisis since the Great Depression but about the dangers of “free market” capitalism? Who would have thought that yesterday’s prophets of globalization would today be singing the praises of capital controls? Who would have thought that words like “overcapacity,” hitherto most likely to be spoken by Marxist economists in the pages of Monthly Review, would cross the lips of investment analysts or financial columnists? Who would have thought that, after many years of “there is no alternative,” five minutes later the same advocates of TINA are desperately scrambling for some kind of alternative? And is there a message in the fact just a year after the Nobel Prize in economics went to the geniuses behind that emblem of contemporary capitalism, the notoriously ill-fated hedge fund, LCTM, this year’s prize has gone to Amartya Sen, for his humane and progressive work on issues such as global poverty?
We don’t want to get carried away. Wall Street won’t suddenly be witnessing a mass conversion to socialism. But at the very least, people who understand the language of turbulent markets, and whose material interests are very much at stake, are being forced to consider the kinds of interventions in the capitalist economy that only yesterday were anathema to them.
Ironically, these people are likely to be, and already have been, less timid in calling for reform of the world financial system than the “liberal” and even so-called leftist governments which are now in the majority among the most advanced capitalist countries. The performance of those governments so far has been anything but bold. The inadequacy of the pathetically weak proposals that came out of the recent G7 meeting sent global markets into a spin, and even the somewhat more interventionist proposals emerging out of the informal EU summit have come nowhere near the scale of the problem. It might be interesting to speculate about this rare disjunction between predatory capitalists demanding reform and left-wing governments refusing to provide it.
Of course it may just be that, for all the U.S.’s dominance in the global economy, there is no single capitalist power, not even the United States, that has the kind of hegemony today that would allow it to bring a degree of discipline to global capitalism, as was done in 1944 by the Bretton Woods Agreement under U.S. leadership and the aegis of the U.S. dollar (an agreement that the United States later broke). The scale and scope of global capitalism may have reached a point where they exceed the capacity of any economic or political power to lend even some limited order to its rampant contradictions.
It remains to be seen what, if anything, the leaders of the world’s richest powers will come up with to pull capitalism, yet again, out of a crisis which is every day proving itself more serious than the most pessimistic commentators thought it was the day before. Much as we’d like to predict that a crisis on this scale will lead to some major and positive transformations, no one can doubt that we’re in for a rough ride. Then again, no one can doubt either that sensible people everywhere will again start giving serious thought to real—socialist—alternatives.
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