Political Economy
The world at present is fast approaching a climate cliff. Science tells us that an increase in global average temperature of 2°C (3.6° F) constitutes the planetary tipping point with respect to climate change, leading to irreversible changes beyond human control. A 2°C rise is sufficient to melt a significant portion of the world’s ice due to feedbacks that will hasten the melting. It will thus set the course to an ice-free world. Sea level will rise. Numerous islands will be threatened along with coastal regions throughout the globe. Extreme weather events (droughts, storms, floods) will be far more common. The paleoclimatic record shows that an increase in global average temperature of several degrees means that 50 percent or more of all species—plants and animals—will be driven to extinction. Global food crops will be negatively affected. | more…
When the real estate market was building momentum during the 2000s, [new types of restructured, risk-based financial instruments] looked like a free lunch and insurers could pocket the insurance premium without ever being called in to make up for losses. However, when the market reversed in 2006, the payday came: some insurers lost heavily, others went bust, and a few, such as AIG, were bailed out. … By the end of the cycle, we had learned about the pro-cyclical nature of ratings-based structured products and the dangers of the new food chain. Hedge fund manager George Soros called Credit Default Swaps “weapons of mass destruction.” We had, many believed, been defeated by novelty. Or had we? Many think that subprime products are new, and that the use of ratings to structure financial instruments and so-called Credit Default Swaps (CDS) are a recent invention permitted by advances in modern finance. They ought to study the history of Levy Maybaum, a man who lived in New Jersey in the late nineteenth century and invented the first CDS. | more…
Sandwiched between revelations of mounting losses ($5.8 billion and rising) at JP Morgan in the face of bungled bets by a trader known as the London Whale, and allegations of money laundering for Mexican drug cartels and breaches of U.S. sanctions by HSBC, the disclosures of deliberate rigging of the Libor rate by Barclay’s Bank might appear mundane and a trifle boring in comparison. It is, however, this scandal about an arcane interest rate that most starkly exposes the rotten core of the global financial system.… [T]he scandal is not simply one of colossal greed and hubris. It is about systemic failure. It is about the fictions and illusions that form the basis of today’s complex global financial system. | more…
Is Population the Problem?
Within the current system, there are steps that can and should be taken to lessen the environmental problems associated with the limits of growth: the depletion of resource taps and the overflowing of waste sinks, both of which threaten the future of humanity.… [H]owever, …attempts to trace these problems, and particularly the problem of depletion natural resources, to population growth are generally misdirected. The economic causes of depletion are the issues that must be vigorously addressed (though population growth remains a secondary factor). The starting point for any meaningful attempt actually to solve these problems must begin with the mode of production and its unending quest for ever-higher amounts of capital accumulation regardless of social and environmental costs—with the negative results that a portion of society becomes fabulously rich while others remain poor and the environment is degraded at a planetary level. | more…
This an excerpt from the forthcoming Lettuce Wars: Ten Years of Work and Struggle in the Fields of California (Monthly Review Press, 2012). Part memoir, part informed commentary on farm labor, the U.S. labor movement, and the political economy of agriculture, Lettuce Wars is a lively account written from the perspective of the fields. Bruce Neuburger portrays the people he encountered—immigrant workers, fellow radicals, company bosses, cops and goons—vividly and indelibly, lending a human aspect to the conflict between capital and labor as it played out in the fields of California. | more…
Tadeusz Kowalik, the doyen of Polish political economists, died at his home in Warsaw on July 30, 2012. Kowalik is best known as the last surviving coauthor of the great Polish economist, Michał Kalecki (1899–1970), as an advisor to the Polish trade union movement Solidarity when it played a key part in bringing down the Communist government in the 1980s, and subsequently as a fierce critic of the capitalism that was put in its place. He challenged both the commonly accepted view of the Keynesian Revolution and the inability of Polish Communists to come to terms with their revolutionary past and find a place for themselves in the modern world. | more…
The question of “underconsumptionism” is a tangled one—due not only to the commonplace fallacy associated with what is known as “crude underconsumptionism,” but also because the term has been used at various times to refer to what Joseph Schumpeter in his History of Economic Analysis called “non-spending” or effective demand theories (the second in a typology of underconsumption theories designated by Schumpeter). Underconsumption in this sense, however, would encompass theorists like Keynes and Kalecki who focus not on underconsumption per se, but on underinvestment. Hence, the term is no longer applied to theories of this type (except by some Marxian critics of “underconsumptionism”).… In the following exchange with Jonathan Penzner published in the April 1982 issue of Monthly Review, Harry Magdoff and Paul Sweezy, then editors of the magazine, pointed to the fallacy of crude underconsumptionism.
Amory Starr, Luis Fernandez, and Christian Scholl, Shutting Down the Streets: Political Violence and Social Control in the Global Era (New York: New York University Press, 2011), 207 pages, $23.00, paperback.
Shutting Down the Streets is not an ivory-tower book, situated a safe distance from its subject; the first appendix lists the seventeen anti-globalization summit protests which were directly observed by the book’s authors. And just as the authors were participants and not just spectators, they also refrain from merely presenting a comparative analysis of policing and repression at these summits. Examining the existing academic literature on social control, dissent, and social movements, they argue that existing works on repression mainly concentrate on protest policing. Instead they aim to develop a broader framework that examines social control by extending the object of analysis from the policing of protest events to the effects of social control on dissent, while also arguing that the unit of analysis needs to be changed from individual protests to the wider one of social movements. Repression then is not just police violence and coercion at protests but also includes a host of other methods of “soft” repression, such as psyops (psychological operations), infiltration, and surveillance. | more…
Race and the Control of U.S. Labor
David R. Roediger and Elizabeth D. Esch, The Production of Difference: Race and the Management of Labor in U.S. History (New York: Oxford University Press, 2012), 296 pages, $34.95, hardback.
In this highly original book historians David Roediger and Elizabeth Esch probe deeply into the relationship of institutionalized racism to the management of labor in the United States. As they emphasize, “race management” has been a much neglected topic in the social sciences. Focusing on the century from 1830 to 1930, they accent the interesting and accurate idea of “whiteness as management”—that is, of labor management theory among white employers and experts as honed within the arena of persisting white-racist framing and action. Among other key points, we see here how capitalistic employers long used the racial and ethnic differences among workers to divide and conquer them. The “scientific” management of workers and the white-racist framing of society evolved together over this long century they examine, as well as over subsequent decades. | more…
Making Oppression Appear Normal
Carl Ratner, Macro Cultural Psychology: A Political Philosophy of Mind (New York: Oxford University Press, 2011), 544 pages, $69.95, hardcover.
Psychologists engage in a number of practices that, mostly unwittingly, help to sustain the cultural distortions of the ruling class and hence their exploitative rule. One of these practices is to treat human behavior as primarily driven by biology. This leads, for example, to the medicalization of mental illness.… It also supports one of capitalists’ favorite ideological ploys: individualism. We are the masters of our own fate, not society and its culture. If we fail, it is our own fault. We simply did not try hard enough or follow the right path. Individualism favors self-blame and a refusal even to look for social causes. Ratner instead argues that humans are qualitatively different from all other species precisely in terms of how culture, not constant biological traits, shape their behavior. He points out that even our closest relatives, the great apes, have not developed culture, institutions, science, religion, etc. We are truly unique. | more…
Capitalism today is caught in a seemingly endless crisis, with economic stagnation and upheaval circling the globe. But while the world has been fixated on the economic problem, global environmental conditions have been rapidly worsening, confronting humanity with its ultimate crisis: one of long-term survival. The common source of both of these crises resides in the process of capital accumulation. Likewise the common solution is to be sought in a “revolutionary reconstitution of society at large,” going beyond the regime of capital.… It is still possible for humanity to avert what economist Robert Heilbroner once called “ecological Armageddon.” The means for the creation of a just and sustainable world currently exist, and are to be found lying hidden in the growing gap between what could be achieved with the resources already available to us, and what the prevailing social order allows us to accomplish. It is this latent potential for a quite different human metabolism with nature that offers the master-key to a workable ecological exit strategy. | more…
On his most recent album, Wrecking Ball, Bruce Springsteen crafted a powerful statement of support for the working class, the existence of which barely penetrates contemporary art or politics. This is not an accident: the growing power of capital over public discourse has provided it a forceful means through which to shape individual consciousness, and establish an apolitical and at most technocratic understanding of power.… Even in the cultural realm, the art and voices of the working class are sidelined and squelched. Working people thus become invisible. | more…