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Monday, December 12, 2022

Some Political Wishes for the Coming Year

As the holidays approach, children traditionally anticipate Christmas by submitting their gift wish lists to Santa Claus.

While (most) adults have long abandoned any belief in the Santa Claus myth, the idea of a wish list or a set of resolutions for the new year still resonates.

My wish list follows.

First, I wish that the idea of socialism would again become popular, but I would rejoice if it would at least be discussed seriously in the US. Now I don’t mean the weak-tea version of socialism associated with the Democratic Socialists of America (DSA) or with Senator Bernie Sanders. That kind of socialism is really a Cold War relic-- a brew of schoolhouse participatory democracy and a minimalist welfare state stirred into a consenting capitalism. But capitalism doesn’t mix well with social democracy, except when capitalism anticipates an existential threat from real socialism, like the popularity of Communism. The political marginalization of European social democracy after a diminished Communist specter following the Soviet collapse of 1991 proves that point.

Real socialism-- to be crystal clear-- cannot amicably coexist with capitalism. There can be no lasting peace treaty between capitalism and socialism, despite the best efforts of many socialists and Communists (there have been few if any of the rich and powerful who sincerely advocated coexistence with socialism in the centuries since socialism was first envisioned). 

For real socialism to take root, the power of the state must be wrested from the capitalists. History shows no sustainable road to socialism through power-sharing with the capitalist class.

That is not to say that there cannot be a transitional period in which capitalists and socialists struggle for dominance over the state, but that period will not be stable. That is not to discount the importance of parliamentary struggle in fighting to establish a socialist-oriented state. That is not to preclude a socialist program that engages with national specifics, class alliances, and shifting tactics. But socialism must be the professed and uncompromising goal of those who claim to be socialists and winning state power must be accepted as a necessary step to achieving any real socialism, where socialism is both the absence of labor exploitation and the ending of the dominance of the capitalist class. Any “socialism” that doesn’t respect these truths is engaged in self-deception.

But what, you may ask, is People’s China? Clearly there is labor exploitation in the People's Republic of China, where powerful private capitalist companies exist alongside state enterprises. And it is just as clear that the Chinese Communist Party maintains a tight grip on state power. For over forty years, the balance of forces between these two realities has shifted frequently, with the CCP leadership, nonetheless, claiming firm control and a commitment to socialism.

Whether genuine Marxists in the CCP can ride this tiger is yet to be decided. Partisans of socialism must follow this development with a critical eye, but an open mind. 

Advocates for socialism-- real socialism-- are not so naive as to believe that socialism is around the corner or that socialism is likely to solve the immediate problems of the working class. It is useful, however, to be reminded that when Lenin left Zurich to return to Russia just months before the 1917 revolution, he spoke to young revolutionaries, explaining that he likely would not see socialism, but they surely would. He was spectacularly wrong. 

But even a heavy dose of pessimistic realism does not explain the absence of the word “socialism” in the political narratives of progressives, the self-styled left, and even self-proclaimed Marxists living in the US and Europe. Moreover, in conversation, eyes roll or go glassy when the idea surfaces. Everyone is an anti-capitalist; everyone is against some form of hyphenated capitalism-- disaster-capitalism, neoliberal-capitalism, financial-capitalism, etc. etc. But no one is for socialism!

You can see this dismissal in the current debates over inflation raging through the left. All disputants recount the effects of inflation on poor and working people. All recognize the negative consequences of official policy-- raising interest rates-- on all. All fumble for alternative solutions, most of which have a past history of failure. None will pronounce this as a contradiction-- an intrinsic failure-- of the capitalist system. All are too busy trying to repair capitalism to even hint that there might be a better alternative. Will there ever be a better time than today to inject socialism into the conversation? 

We suffer from the leftover fears of Communism and socialism in the wake of the Cold War. We are suffocated by the limited options allowed by our corrupted two-party system. And we are overwhelmed with cynicism and a poverty of vision.

Surely a frank, honest discussion of socialism is in order.


My second wish would be for left clarity and unity on the war in Ukraine. To a great extent, the left’s poor understanding of the relationship between capitalism, imperialism, and war has spawned wide divisions in an already fractious left. On one hand, liberals and social democrats discount the history of conflict in Ukraine and mechanically apply a simplistic concept of national self-determination to what is, in fact, a civil war. They see Russian intervention as simply a violation of Ukraine’s right to decide its own future. Using their logic, it is as if the US Civil War was construed as a war over the South’s right to self-determination and not a war over slavery. Or in a twentieth-century instance, it would be as if the war in Vietnam were viewed as a fight for the rights of the people in an artificial South Vietnam to choose their own destiny.

Both the idea of the South’s right of secession (state’s rights) and the “freedom” of South Vietnam were abusive of any legitimate right to self-determination. Neither took the measure of the desire of the masses; both served the interests of privileged elites or foreign powers.

Leading historian of the Korean War, Bruce Cumings, reminds us that civil wars are complex conflicts with complex histories and little is gained by pondering who started the war in assigning blame. Obsession with determining the immediate “aggressor” in the Korean War clouds the understanding of the deeper causes, colliding interests, and political stakes at play to this day.

Without a historical context, without understanding the conflict and clash of vital interests within the borders of Ukraine, a defense of US meddling in Ukraine constructed on the facade of self-determination is wrongheaded and dangerous. There can be no self-determination when the US and its allies undermined an elected government in 2014. That intervention effectively put an end to any pretense of Ukrainian self-determination.

On the other hand, many self-styled anti-imperialists view the Russian invasion as a war of liberation, with Russia removing Kyiv’s oppressive government, thwarting US and NATO aggression, or defending the interests of the people of Eastern Ukraine. They both overestimate the selflessness of the motives of the now capitalist, former Soviet Russian republic and underestimate the dangers unleashed by an invasion that opens the door widely to a further reaching, more intense war. 

They also fail to see that in its essence the conflict in Ukraine has been a civil conflict since the demise of the Soviet Union. Without the ideology of socialism, that conflict has been driven by a scramble for wealth and power with ensuing corruption, manipulation, and crude nationalism. Foreign powers-- East and West-- have manipulated this scramble, forcing it to a proxy showdown. Any escalation-- whether it is a coup, an invasion, or the continuing arming of belligerents—would further risk pressing the war beyond the borders or at a greater tempo and should therefore be rejected.

Behind some defenders of the Russian invasion is the neo-Kautskyian theory of multipolarity. This view sees US imperialism, and not simply the system of imperialism, as the force disruptive of a peaceful, stable, and orderly world order. It is possible, even likely-- according to the theory-- for capitalist countries to conduct international affairs benignly if only a predatory US were tamed. They go beyond denouncing US imperialism as the main global enemy to imagining a viable, cooperative capitalist order without US dominance. Like Kautsky, multipolarity projects an era of “balance” between imperialist powers and the softening of rivalries. 

Lenin rejected this view. Like Kautsky’s theory of super- or ultra-imperialism, multipolarity reflects an inadequate understanding of class dynamics-- the unlimited drive for competitive advantage by the capitalist state-- and a failure to recognize that socialism is the only answer to imperialism’s destructive anarchy.  

The carnage of imperialism’s last hundred years since the Kautsky/Lenin debate surely underscores these truths.


Along with the revival of Kautskyism, neo-Malthusianism threatens to confound the thinking of the left in addressing the critical environmental crisis. No-growth as a facile answer to the abuse of our environment is as misguided today as it was in Marx’s time. The critical question is how the global economy grows and not how much it grows.

My wish is that the left does not ignore the class issues-- nationally and internationally-- in developing a program to address this vital matter. A no-growth solution that freezes in place the internal and global inequalities, or exacerbates them, cannot be accepted. A program that does not address the connection between imperialism, militarism, and war in despoiling the planet is inadequate. 


As the lights go out on the nine-and-a-half-billion-dollar midterm electoral extravaganza, leaving a bad taste and a strong sense of emptiness and disappointment, we can only wish that the US left will take a critical look at the two-party system with the idea of uniting to create some independent presence in electoral politics.

May 2023 be a year of deeper discussion beyond chirping on the shallow platforms crafted for triviality and abasement by the ruling class.

Greg Godels

Thursday, December 1, 2022

Free Market Follies

This is not the first era of capitalist excess that forces normally lapdog journalists and the compliant mainstream commentariat to cast scorn and derision over one of their “entrepreneurial” icons. But surely this is one of the more ridiculous and revealing exposures of market hubris.

After failing to obtain fresh financing, the cryptocurrency exchange, FTX, filed for Chapter 11 bankruptcy protection on Friday, November 11. Like an overripe watermelon falling on hot pavement and spewing seeds and pulp in every direction, FTX’s troubles splashed before the public, revealing a noxious slurry of corruption, arrogance, class chauvinism, and spinelessness.

We learn that a privileged 30-year-old son of two Stanford law professors managed to create a firm in 2019 recently valued at $32 billion and also said to have amassed a personal worth of $26 billion before FTX’s collapse. Affecting t-shirts and shorts and going by the hip moniker, SBF, Sam Bankman-Fried was Peter Pan to his small executive group of “Lost Boys” and his FTX Neverland. Playing Wendy to SBF’s Peter Pan in this drama is a 28-year-old math prodigy-- the daughter of two MIT economics professors-- Caroline Ellison. They, and their co-executives, played out their fantasy in a luxurious mansion in the Bahamas (You can get a taste for SBF’s maturity and acumen in this post-crash YouTube interview which appears to have him splashing in the bathtub or in the surf, judging from the background noises).


SBF and his playmates “earned” their treasures through trading magical cryptocurrencies and investing in allied companies. To most of us, cryptocurrencies were and are baffling. In the US and most of the rest of the world, we already have a currency (dollars, renminbi, euros, etc.) or, if we don’t like our currency, we can exchange it for another. Why create another shadowy, tech-based means of exchange?

My own ignorant prejudice was that cryptocurrencies were possibly of use to criminals-- drug dealers, organized criminal syndicates, anyone hiding ill-begotten money. 

Similarly, tax evaders might welcome an arcane, semi-private money with no blank spaces specified on the tax return. Maybe militant, intensely principled anti-tax libertarians are embracing cryptos.

 Or cryptocurrencies might merely be the latest piece of financial engineering designed to capture speculative wealth on the upswing, as hipsters joined the herd of quick-wealth seekers pressing values skyward. Whether tulips, derivatives, or cryptocurrencies, manias have been sure-fire methods of amassing wealth for those who leave the game before the bubble bursts.

Anyone following the financial press must have surely noticed that journalists and commentators were decidedly ambiguous about crypto, neither embracing nor challenging crypto’s legitimacy.

But it wasn’t a burst of the crypto bubble that shattered SBF’s Neverland, though that may be forthcoming (the crypto universe has lost roughly 72% of its value). Instead, it was the apparent revelation that FTX had funneled large sums of customers' cash to the allied investment company, Alameda Research. 

Believe it or not, Wall Street has rules, though certainly not to protect the general public, the productive economy, or the petty investor. But moving billions of dollars outside of intended investment purposes violates the rich peoples’ club’s sense of fair play. 

Apparently, FSX’s Neverland was unsupervised. While some veteran investors walked away from the “opportunity” to invest in FSX, while some corporate leaders were skeptical in spite of SBF’s youthful wit, charm, and idealism, celebrities and politicians were eager to endorse the risky venture. No one-- including the young entrepreneur’s family and circle of associates-- found anything extraordinary about a small, insular, conceited clique growing a business from zero to tens of billions of dollars in less than three economically rocky years!

His shaky regard for business “ethics” and corporate legality makes the fawning adulation of SBF even more problematic for his admirers. He was, after all, the second largest individual contributor to the Biden presidential campaign after George Soros. And he supported numerous other liberal causes as well.

Behind SBF’s liberal largesse is a “philosophy” popular with the rich and powerful called “effective altruism.” In its most crude, accessible form, it urges the wealthy to accumulate enormous sums of money in order to give more generously to charitable causes. In its simplified form, it appears little different from the paternalistic philanthropy of the old robber barons who built libraries, museums, and endowed some schools to justify their extreme exploitation of the working classes. For many, effective altruism will ring true of an apologia for securing unconscionable amounts of wealth by giving a bit of it away.

But in this era of extremes, of market fundamentalism, of commodification of everything from public services to ideas, academic philosophers have risen to the challenge of providing a more secure, intellectually satisfying, outwardly rational justification for acquiring obscene wealth.

And they have stepped to the intellectual plate in the twenty-first century.

Now moral and political philosophers have always performed the role of justifying or explicating the dominant moral, legal, and political ideas of their time. Some have said and some can say that they mirror the ideas espoused by their ruling classes. On occasion, a few philosophers have misjudged the moment and paid with their lives by anticipating the emerging ideas of their era-- for example, Socrates or Giordano Bruno.

After World War II, moral and political philosophers in the Anglo-American tradition were unabashedly occupied with defending the core ideas of Western liberalism. 

At the height of the Cold War, for example, the UK philosopher, Isaiah Berlin, was acclaimed for his windy, but far less-than-convincing special pleading for what Marx would call “bourgeois rights.” Later, John Rawls would dominate the field with his sophisticated, rigorous defense of Western social democracy-- an impressively expanded opus based on his earlier paper (1958), Justice as Fairness. His was the most ambitious attempt to ground Western capitalism and its bourgeois democratic superstructure on a rational foundation.

With the end of the Cold War, Anglo-American political and moral philosophy had little to do but celebrate and navel gaze. A new generation of moral philosophers explored the less-than-weighty questions of sentiments, emotions, and feelings and the other immediate concerns-- like animal rights, identity, and individual regard-- of the petty bourgeoisie.

In our current moment of absurdity, of unprecedented inequality and wealth concentration, a small, but influential group of philosophers has emerged to provide a patina of social justice to the bloated wealth accumulated by Bezos, Soros, SBF, and their ilk.

This opportune school of philosophy has become associated with a young, earnest Oxonian professor named William MacAskill. MacAskill has promoted two key ideas: earning to give and longtermism

MacAskill’s quick ascent to the higher rungs of one of the world’s most celebrated schools of philosophy, and his media celebrity no doubt is owed to his project to give elites a moral justification for their fantastic wealth. 

Earning to give differs from the previous acclaim heaped on philanthropic benefactors in two ways. 

First, unlike prior moral praise for the wealthy, earning to give does not envision charity as supererogation-- a philosopher's term for morally commendable acts outside of obligation-- but locates philanthropy firmly in the realm of obligation, of duty: it is a duty for the rich to part with their wealth to benefit humankind. 

Mogul Andrew Carnegie did not have to fund libraries, yet he did it out of a good heart-- so goes the conventional view. But MacAskill contends that duty compels Carnegie to dispose of his wealth for the greater good. In this sense, MacAskill is making a strong case that the rich aren’t doing the rest of us any favors with their charity because they are morally obligated to do good with their wealth. We owe them no thanks for doing what they must.

The second aspect of earning to give is the accompanying duty to accumulate as much wealth as possible in order to maximize giving. It is not enough to give generously; one must make every effort to get more to give more. Thus, MacAskill justifies the capitalist maxim revealed by Marx to “Accumulate! Accumulate!” by attaching it to the effective altruistic demand to “Give more! Give more!”

It is a sign of the backwardness of our times that few in intellectual circles question the brazen elitism, the abandonment of democratic process latent in earning to give. When did it become a commonplace, an axiom, that social justice should be placed in the hands of the rich and powerful? Should the disposal of society’s wealth be decided by the fortunate few or democratically by the people through their elected representatives? It should be apparent that earning to give-- as a means of meeting the peoples’ social needs-- is inherently undemocratic.

But there is more: MacAskill and his circle have also contrived the clever, but misguided concept of longtermism. Effective altruism asks rich benefactors to look beyond the range of classical utilitarianism, beyond giving to alleviate the inequalities and injustices of the here and now. 

Instead, MacAskill’s theory requires all acts of effective altruism to consider how each act might impact future generations. Thus, if the five dollars that could feed a starving family today might be repurposed to help fund an NGO that will help thousands in the future, then that is where the five dollars should go. Longtermism effectively expands our moral concerns well beyond the eight billion inhabitants of our world today to the possibly infinite number of global citizens that the future will produce. The eight billion-- as an immediate concern-- are accordingly diminished. In fact, they are erased from the philanthropic calculus of the obscenely wealthy. 

Longtermism grants Jeff Bezos or George Soros and their counterparts the right to ignore the damage left in the wake of twenty-first century capitalism-- the vast inequality, poverty, insecurity, and war-- in order to “service” the needs of trillions of hypothetical and potential humans who may come into being in the limitless tomorrows. This clever, but ultimately cynical philosophical gambit trivializes the common-sense responsibility that moral and political philosophy has acknowledged-- for literally thousands of years-- as existing between each of us and our brothers and sisters.

Quite simply, longtermism is an evasion of that responsibility that we each owe to one another. It allows the very rich to maintain their gated communities, to step over the real, existing homeless, to justify obscene wealth inequality while pretending to lead morally exemplary lives. After all, they are looking after the interests of the trillions yet to be born!

We arrive at this destination precisely when we have intellectually disconnected the idea of wealth accumulation from its roots in exploitation. Too few of us think of the very rich as securing their vast wealth by exploiting the labor of others. The exploitation of workers seems very old fashioned, very nineteenth century. We have abandoned any notion that masses of private riches are really socially generated and socially owned wealth-- commonwealth-- to be allocated democratically for the good of all. That would be the unfashionable notion of socialism.

We assume that great wealth is the desert of the few; they have “earned” it. So we accept such bizarre, desperate ideas as effective altruism as a credible road to social justice, as a legitimate moral and political posture. Let us praise the rich for endowing chairs of effective altruism, funding foundations to plan for an unknown future, and creating forward looking NGOs that anticipate tomorrow’s problems, while sidestepping the horrors of today.

A philosophy that promotes this cynicism coexists within a social order that legitimizes financial toys and encourages adolescents to play with them. 

Pray we survive. 

Greg Godels

Sunday, November 13, 2022

After the Election: The Road Ahead?

Without saying it in so many words, The Wall Street Journal summarized the results of the November 8 mid-term election: The US electorate feared the Republicans more than they disliked the Democrats.

Historically, a major party with an incumbent president overseeing a painful economy and with the President polling negatively receives a big hit from the electorate. That didn’t happen this year.

As the WSJ puts it more diplomatically:
Voters were in a sour mood that usually signals that they are ready for change in Washington and state capitals. But in many cases, they were not looking for the change that Republican candidates were offering.
Some of the movers-and-shakers in the social democratic movement seem to agree. Writing in Jacobin, they observe:
A major factor in Democrats’ stronger-than-expected showing nationally appears to be the rock-bottom expectations of their voters. An NBC exit poll captured a deep sigh of resignation at the ballot box, with Democrats winning among voters who “somewhat disapprove” of Joe Biden’s job performance. Overall, more than seven in ten voters said they are “dissatisfied” or “angry,” according to exit polls conducted by Edison Research.
Such results suggest that Democratic voters weren’t inspired to vote for their candidates; they just couldn’t tolerate the alternatives.
And why would voters feel otherwise? They had just suffered through a vicious, but hollow campaign that raised and spent an obscene amount of money (supposedly a quarter of a billion dollars in Pennsylvania, over 30 dollars per person in Georgia on the respective Senate races). Republicans portrayed Democrats as socialists while Democrats responded by calling Republicans “fascists.” Neither side had the foggiest understanding of socialism or fascism.

Democrats were convinced that they could run on little more than the abortion issue and trashing ex-President Trump, even financially supporting Trump’s candidates in some primaries, convinced that they could more easily defeat them in the general election.

Republicans relied on their conventional toolbox of baiting-- crime, race, reds under the bed-- and economic management.

While Democratic candidates and spin doctors touched none of the most critical issues facing US voters-- a host of urgent matters like a failing, low-income economy, health care costs, exploding costs of food and housing, massive debt, ineffective and costly education, immigration reform, inequality, and, most importantly, an expanding US/NATO/Russia war in Ukraine-- they correctly gauged that many centrist voters were fed up with Trumpite rhetoric and bombast, and voters were enthusiastic about rejecting him.

Likewise, they were correct about alarm over the Supreme Court anti-abortion decision. The number of voters who thought that abortion was the most important issue grew three-fold to 10% from the last two elections.

The Democrats held their ground despite losing one of their most reliable allies in recent elections: suburban women.

Their cavalier presumption of Black and Latino voters continues to cost Democrats, especially among younger Black voters. The AP VoteCast survey shows that “Younger Black voters moved a substantial 22 percentage points toward Republicans in 2022.” How much longer can the Democratic leadership ignore the pressing needs of African Americans and other minorities and the widening inequalities that they suffer?

The five prominent progressive co-authors of the Jacobin article, Eight Lessons from the Midterm Election, correctly recognize the growing gap between the needs and desires of most US voters and the program that the Democratic Party leadership and its electoral machine will accept. Further, they argue that where Democrats put forth a more people-oriented program, they fare better.

True enough.

But the article’s authors fail to equally recognize that even on the rare occasion when the campaign promises are more progressive, they tend to evaporate after the election. And more often than not, Democratic “progressivism” is opportunism of the moment.

For example, Fetterman, the Senate winner in Pennsylvania, was a strong anti-fracker when that suited his audience, but a pro-fracker when it suited his political ambitions. His support for health care never took him to strong advocacy of Medicare for All, but left him in the rhetorical twilight zone of “healthcare is a human right”. And then there is the centerpiece of economic comparative advantage: marijuana production. His trajectory is not an uncommon story among Democratic Party “progressives” (I cringe when I remember how Reaganaut liberal-baiting made Democrats cravenly give up the word “liberal” for “progressive”).

It is challenging to imagine that this election will change much. With the presidency, the House of Representatives, and a very slim advantage in the Senate, the Democrats accomplished very little. And, as was true of the Obama years when they owned a super-majority for two years, they sought to do far less than they promised. Thus, in power for ten of the last fourteen years, the Democratic Party has clung to centrist policies that offered no serious opposition to corporate power.

And yet the hardships facing the US people are far greater than they were when Obama took office in 2008. In the face of economic setbacks and burgeoning inequality, the Democrats have answered the call of monopoly capitalism while asking the people to sacrifice-- largesse for one class, austerity for the other.

It certainly seems that the urgent fight to overcome desperation, inequality, austerity, and war will now only come with masses in the streets, rather than in the voting booth.

Greg Godels

Tuesday, November 1, 2022

When “No” means “Yes” to War

At a time when divisions and confusion in the anti-war, anti-imperialist movement have made many activists bystanders to the war in Ukraine, CodePink has boldly led the way in denouncing the war and calling for negotiation. Unlike some groups that buried the war question in a laundry list of grievances, causes, and injustices, CodePink focuses laser-like on the danger of escalation and possibly nuclear war.

Thus, when I got an email from CodePink on October 25 with “Finally!” on the subject line, I fully expected to learn of a new and important development in the peace movement.

I wasn’t disappointed. 

The hard-working peace warriors of CodePink announced-- with some measure of pride-- that “After months of grassroots activism, 30 Democrats in Congress have signed on to Congresswoman Pramila Jayapal's letter to President Biden calling for a ceasefire and diplomatic settlement to the war in Ukraine.”  Thirty members of the House Democratic [self-styled] Progressive Caucus had signed on to-- an admittedly tepid-- statement departing from the Biden Administration’s rabid instigation of war in Ukraine. 

With a growing call for negotiation from unlikely public figures like Henry Kissinger, Jeffrey Sachs, and Elon Musk, with a mid-September Quincy Institute poll showing that most US citizens (57%) support negotiations to end the war, with 57 Republicans voting in May against an additional $40 billions of military aid to continue the war, and with Republican leadership suggesting that, should they win the interim election, they might not support further US military aid to continue the war, one would welcome “Progressive” Democrats seizing the opportunity to help bring this dangerous war to an end. 

Despite a complete and total lack of confidence in the Democratic Party and a belief in its limitless appetite for political opportunism, I decided to celebrate CodePink’s efforts by forwarding the group’s email to my comrades and friends in the Pittsburgh Anti War Committee; we had only recently staged demonstrations in Pittsburgh to call for an end to the war. Democrats breaking away from their party’s shameful role in sparking the war and fueling its escalation certainly deserved acknowledgement and praise.

But the celebration ended within 36 hours when the leadership of the “progressive” Caucus rescinded the letter. Caucus chair Jayapal and some who signed the letter unceremoniously and cravenly blamed staff members for releasing the letter while declaring continued loyalty to the Administration’s war huckstering.

I was compelled to apologize for misleading my comrades. It was not the first time I underestimated the spinelessness of the Democratic Party.

While the “progressive” Democrats shamed themselves, the Democratic Administration chose that moment to reveal their reckless nuclear policy. The Defense Department announced that the “Pentagon’s Strategy Won’t Rule Out Nuclear Use Against Non-Nuclear Threats,” as Bloomberg headlined. Further, Bloomberg writer Anthony Capaccio claimed that the “Defense strategy shuns limits on use once embraced by Biden.”

Earlier, the monopoly capitalist media vilified Putin for suggesting that Russia would use nuclear weapons under certain circumstances, a suggestion that Putin recently pulled back. Yet not a word of alarm or condemnation over an explicit policy of potentially using nuclear weapons when there is no counterpart nuclear threat, a serious escalation of the tension in Ukraine.  

With an approaching interim election, have the Democrats given the anti-imperialist left any reason to vote for them?

Margaret Kimberley-- writing in The Black Agenda Report– said this about the Congressional Progressive Caucus’s opportunism:

This fiasco is yet another reminder that the left in this country had better start speaking up for themselves. The democrats are the party of war and will not allow even a tiny expression of dissent. Some of the letter signatories have fallen on their swords, yelled loud mea culpas and joined in condemning themselves. Others are silent after having stepped out only to be stepped upon.

No one should think that help is coming from Washington. The U.S. involvement in Ukraine will end with negotiations or with a hot war. That determination will not be made by Pramila Jayapal or anyone else in congress who calls themselves progressive.

Democrats are welcome to join us, but we must cancel this war without relying on the Democratic Party leadership. They are the problem.

Greg Godels

Thursday, October 20, 2022

Ruling Class Angst

There is a profound difference between the economic crisis of 2007-2009 and the evolving crisis of 2022. In 2007, capitalists feared the collapse of their own enterprises, but they had no doubt that the system was salvageable, albeit at costs that might prove difficult to impose. They knew that if the politicians could be won over to endorsing Wall Street’s prescriptions, if the people kept their pitchforks tucked away, and if the capitalists, in their greed, could be kept from devouring each other, then there was a good chance that an elite economic version of an “EMS” rescue team could save capitalism from further decline. Sure, the executives at Lehman Brothers, Bank of America, AIG, and many other firms had every right to fear for the future of their companies. But few capitalists imagined an existential threat to the system; few failed to believe in a way out.

This time is different.

Stagflation is a different kind of beast and that beast has the bourgeoisie, its friends, and its hangers-on terrified. The problem is that economic “science,” as they know it, only offers one possible escape and it has dire economic and political consequences. Once they recognized that inflation was not simply a momentary speed bump (as I predicted nearly a year ago), Central Bankers and economic gurus who have studied the 1970s-- the long, painful decade of stagflation-- prescribed a drastic remedy of slamming on the brakes of economic growth to contain inflation. Some nonetheless fear a long period of inflation and stagnant growth.

The 1970s taught that cheerleading, patience, and half-measures would not work. The Whip Inflation Now (WIN) campaign, price controls, and other approaches failed until the then-Federal Reserve chair, Paul Volker, boldly imposed draconian interest-rate increases that threw the economy into deep recession. Inflation tamed. Lesson learned. 

Certainly, no political regime wants to be associated with income-and-wealth-devouring inflation. But neither would it want to suffer through a job-devouring, wage-declining recession. Voters and subjects seek to punish the politicians in office when either situation arises. 

Thus, politicians and rulers are caught on the horns of a dilemma. If they ignore inflation, they pay a political price. If they attack inflation and bring on economic decline, they also incur the wrath of the electorate or their subjects. Either option taken constitutes a deep threat to the incumbent party or the ruling regime. 

Recently, some politicians have chosen to ignore the lesson that bourgeois economists have drawn from the 1970s bout with stagflation. Turkish president Erdogan decided to defy the convention by coercing the country’s central bank into lowering interest rates in the face of growing inflation, betting that the benefits of economic growth would outweigh any increase in inflation. He was wrong. Inflation has soared with devastating results on the people’s living standards and security.

Even more recently, the newly selected Conservative UK prime minister, Liz Truss, out of sheer arrogance or a profound economic ignorance, offered a budget based upon promoting growth (predictably through tax cuts for the rich!) and ignoring the anti-inflation moves of the Bank of England (BOE). Financial markets immediately reacted violently, forcing the BOE to go on a corrective bond-buying spree, and earning a rare rebuke of European government policy from the International Monetary Fund. Once again, the lesson of the 1970s stagnation crisis was harshly driven home.

With an interim election only weeks away, the ruling party in the US fears a severe beatdown from the angry electorate, devastated by sharp price increases imposed by profit-hungry monopoly corporations, declining incomes, and exploding interest payments on loans. At best, President Biden can only browbeat his Saudi allies for sustaining high energy prices in a global market disrupted by US corporate interests and US-instigated war, while the Federal Reserve slams on the economic brakes.

Liberal and social democratic labor leaders, party leaders, and pundits correctly object to the frequent blaming of inflation upon “greedy” workers or bloated union contracts. Even a cursory glance at the Bureau of Labor Statistics demonstrates that throughout this inflationary period income growth trailed and did not lead the growth in prices. That said, what do they think caused this persisting inflation? What can they offer in response to the bitter pill prescribed by bourgeois economists and the Central Banks?

Hell bent on saving capitalism from itself, some liberal and left thinkers like Dean Baker and Richard Wolff see price controls, ration cards, or public commissions as possible approaches (I refute these solutions here). Even if these fixes were likely to be enforced by governments thoroughly captured by capitalism, it would be unlikely that they could even be adopted in today’s volatile political atmosphere. The impending severe crisis cannot be met by wishful bromides or failed tactics.

More seriously, some on the left point to “financialization” as the cause of capitalism’s ills today. While the much-abused term begs many questions, it does describe one side of the restructuring of roles assumed by the leading capitalist countries as a response to the previous, 1970s version of stagflation. That is, so-called “financialization” was the new role of some advanced capitalist countries that deindustrialized after the stagflation of the 1970s. The flight of industry to low-wage countries was part of the answer to 1970s stagflation, stabilizing global capitalism and restoring the rate of profit for most of the next two decades. 

“Financialization” was the accompanying new role for those capitalist countries that surrendered their industries to emergent low-wage countries.

The stagflation of the 1970s caused the demise of the Keynesian consensus that had come to dominate economic policy since the Great Depression. That toolbox contained nothing to fix what was over a decade of roaring inflation. Indeed, many orthodox economists blamed the Keynesian tools for creating the conditions that led to that round of stagflation. In any event, it was the “financialization” era that superseded 1970s stagflation and was then believed to restore capitalist accumulation after its assault by stagflation. Therefore, it’s difficult to envision “financialization” as both a solution and cause of stagflation. 

While it is fashionable, since the crisis of 2007-2009, to see the dramatic rise of financial engineering and activity-- centered on the development of the many new financial instruments-- as the sand in the gears of capitalism, there is no reason to believe that it is any more than another adaptive stage in a resilient, but constantly crisis-plagued socio-economic system. 

It is difficult to foresee an easy, relatively painless capitalist solution to stagflation. That is not to discount the durability of capitalism. But the history of the 1970s teaches that any answer comes with enormous pain. We are only beginning to experience the rising costs from interest payments on top of the rising consumer prices. We are only beginning to feel the effects of galloping inflation compounded by stagnant incomes and growing unemployment. We are only beginning to recognize the strain on retirement funds and 401k’s. The lessons of the 1970s are distant and poorly remembered. But they are there for those who wish to heed them.

It should not be lost to anyone studying those lessons that hourly wages in the US adjusted for inflation have remained stagnant since the 1970s. More families now have two or more earners to compensate. Household debt has risen to counteract the loss in earning power. And income and wealth inequality has exploded, topping any other historic period. 

With a lost decade to stagflation and forty subsequent years of a tepid, crisis-ridden “recovery,” it is hard to imagine how people can endure another round of stagflation. It is hard to imagine how people can fail to explore the alternative to the capitalist system that brings so much unnecessary pain and misery.

Of course, part of the reason for ideological stagnation lies with the political parties, institutions, and misleaders that are so deeply invested in seeing capitalism persist. There would be no “social justice” industry-- the tens of thousands of foundations, NGOs, and charities-- without capitalism. Their criticism of capitalism ends, when the subject of socialism arises. Similarly, educators, writers, and media figures cannot risk alienating those who guarantee their stature and incomes. It goes without saying that both major US political parties are entirely invested in capitalism.

Yet their cynicism and hypocrisy would evaporate if it weren’t for the enormous material resources that capitalism makes available to those who safeguard the system's future. That will not change until the masses of the people use the power of their numbers to change it.

Whatever joy we may derive from the ruling class’s fears and anxiety over the current crisis is overshadowed by the hardships yet to disrupt the lives of millions of working people. 

Socialism is the alternative.

Greg Godels