Political Economy
Until recently, the global capitalist economy has enjoyed a period of comparative tranquility and grown at a relatively rapid pace since the global economic crisis of 2001–02. During this period of global economic expansion there have been several important economic and political developments. First, the United States—the declining hegemonic power but still the leading driving force of the global capitalist economy—has been characterized by growing internal and external financial imbalances. The U.S. economy has experienced a period of debt-financed, consumption-led “expansion” with stagnant wages and employment, and has been running large and rising current account deficits (the current account deficit is a broad measure of the trade deficit). Second, China has become a major player in the global capitalist economy and has been playing an increasingly important role in sustaining global economic growth. Third, global capitalist accumulation is imposing growing pressure on the world’s natural resources and environment. There is increasingly convincing evidence that the global oil production will reach its peak and start to decline in a few years. Fourth, the U.S. imperialist adventure in the Middle East has suffered devastating setbacks and there has been growing resistance to neoliberalism and U.S. imperialism throughout the world. | more…
The July–August 2007 crisis in subprime mortgage markets precipitated the collapse of the market for asset-backed securities, forcing huge write-downs of more than $45 billion on the balance sheets of major banks. In the aftershock, interbank lending dried up. Bond insurers and money market funds were beset by a loss of confidence as the credit squeeze spread. The plunge in stock markets in January 2008 suggests that the repercussions of the collapse of the subprime mortgage market are still working their way through financial markets. With over 170,000 jobs lost and the expected spate of foreclosures, many observers believe that the credit crunch has pushed the economy towards a recession. | more…
Capitalism and market economy are not synonymous, as the dominant political discourse and conventional economists would have one believe. The specific characteristic of capitalism as a system is that it is based on private ownership of the means of production; an ownership which by definition is that of a privileged minority. This private ownership (aside from land ownership) has taken the form of exclusive rights over important equipment associated with modern production technologies, from the first industrial revolution at the close of the eighteenth century to the present day. The majority of non-owners are thus obliged to sell their labor power: capital employs labor; labor has no free use of the means of production. The bourgeois/proletarian divide defines capitalism; the market is only the management form of capital’s social economy. | more…
In March 2003, Khalid Sheikh Mohammed, alleged mastermind of the 9/11 attacks, was captured in Pakistan. Much of the information on his movements and whereabouts is believed to have come from interrogations of his two children, aged six and eight. The children are known to have been held in an adult detention facility for at least four months while they were interrogated. During this time, according to one witness, “the boys were kept in a separate area upstairs, and were denied food and water by other guards. They were also mentally tortured by having ants or other creatures put on their legs to scare them and get them to say where their father was hiding.” After that, they disappeared into the system and nothing more was heard about them. Their current whereabouts and condition are unknown. The United States has sunk to kidnapping, imprisoning, torturing, and then “disappearing” children in order to get at their parents. What were once dark and unlikely rumors have gradually proven to be true: many men, women, and yes, children have been abducted around the world and fed into the maw of the American system. | more…
Marge Piercy is the author of Pesach for the Rest of Us: Making the Passover Seder Your Own (Schocken, 2007). Her most recent novel is Sex Wars: A Novel of the Turbulent Post-Civil War Period (New York: William Morrow, 2005), and her newest book of poetry is The Crooked Inheritance (Knopf, 2006). | more…
In early 2011, the nation was stunned to watch Wisconsin’s state capitol in Madison came under sudden and unexpected occupation by union members and their allies. The protests to defend collective bargaining rights were militant and practically unheard of in this era of declining union power. This timely book brings together some of the best labor journalists and scholars in the United States, many of whom were on the ground at the time, to examine the causes and impact of events, and suggest how the labor movement might proceed. | more…
Michael Moore’s film, Sicko, dramatically illustrated how problems in access to health care in the United States have escalated to the point of a crisis for all but the richest Americans. The problems include the fact that many citizens are uninsured, health care costs are increasing faster than inflation and wages, and more of those costs are being passed on from employers to employees. Many indices of health care effectiveness show that the United States fares very poorly in comparison to other developed capitalist countries. Almost all the other developed capitalist countries have universal health care. All their citizens are insured and their per capita costs are much lower. | more…
Steven Hiatt, ed., with introduction by John Perkins, A Game as Old as Empire: The Secret World of Economic Hit Men and the Web of Global Corruption (San Francisco: BK Currents, 2007), 310 pages, paper $24.95.
Just before John Perkins, author of the bestselling Confessions of an Economic Hit Man, decided it was no longer possible to remain silent about his intimate involvement in the economic warfare waged against the Global South, he sat despondently before the ruins of Ground Zero, totally incapable of visualizing the tragedy: all he could see was a U.S. contractor delivering millions of dollars of weapons to the mujahadeen in Afghanistan. Perkins understood himself—a former economic advisor for a multinational utilities contractor, similar to Bechtel—and others like him, to be products of a “system that promotes the most subtle and effective form of imperialism the world has ever witnessed.” Mainstream commentators addressing Perkins’s book ignored the vivid recounting of his own personal involvement as an economic hit man. This is undoubtedly because Perkins used this experience to emphasize the substantial connections between U.S. intelligence agencies, multinational corporations, and political elites of the Global South, laying bare the true motives of “development.” As an “economic hit man,” Perkins fabricated nearly every economic forecast he was asked to produce—as his bosses clearly expected him to do. This led him to repeatedly attack U.S. economic dogma in Confessions | more…
We live in a complex, divided society. We are divided by wealth, income, education, housing, race, gender, ethnicity, religion and sexual orientation. These divisions are much discussed; in the last two years, there have been entire series in our major newspapers devoted to the growing income divide. The wealth-flaunting of today’s rich was even the subject of a recent Sunday New York Times Magazine article (“City Life in the New Gilded Age,” October 14, 2007). | more…
All the currents that claim adherence to political Islam proclaim the “specificity of Islam.” According to them, Islam knows nothing of the separation between politics and religion, something supposedly distinctive of Christianity. It would accomplish nothing to remind them, as I have done, that their remarks reproduce, almost word for word, what European reactionaries at the beginning of the nineteenth century (such as Bonald and de Maistre) said to condemn the rupture that the Enlightenment and the French Revolution had produced in the history of the Christian West | more…
Sudhir Alladi Venkatesh, Off the Books: The Underground Economy of the Urban Poor (Cambridge, MA: Harvard University Press, 2006), 448 pages, hardcover $27.95.
In 1988, the National Urban League reported, “More blacks have lost jobs through industrial decline than through job discrimination.” For a civil rights organization, this was a remarkable observation. Born in the era of Jim Crow racism, the Urban League championed the aspirations for upward mobility among urban African Americans. When banks refused to lend money to black entrepreneurs or when municipalities failed to service the black community, the Urban League intervened. One of the demands of the Urban League was for public goods to be shared across racial lines. While the organization was not on the frontlines of the civil rights struggle, it would have been a major beneficiary of the movement’s gains. But the tragedy of the civil rights struggle was that its victory came too late, at least thirty years late. Just when the state agreed to remove the discriminatory barriers that restricted nonwhites’ access to public goods, the state form changed. Privatization and an assault on the state’s provision of social welfare meant that it was not capable of providing public goods to the newly enfranchised citizens. At the same time as the state retreated from its social welfare obligations, the industrial sector in the U.S. crumbled in the face of globalization. Industrial jobs, once the backbone of the segregated black communities, vanished | more…
The global economic crisis that closed the first decade of the 21st century has demonstrated that the contradictions of capitalism cannot be overcome. The challenge for socialist analysis is to reveal both the nature of these contradictions in the neo-liberal era of globalized finance, and their consequences in our time. This volume, a companion to The Crisis This Time: Socialist Register 2011, examines the response of the international Left and asks, how has the Left responded and can it offer an alternative to faltering capitalism? | more…