The Economy Is Not Coming Back Part I: A Short History of the Maelstrom by Gilles d'Aymery
(Swans - September 20, 2010) Another mid-term election is looming in the United States. Next November, the electorate will choose the political team that in the midst of a recession and widely-held fears about the future will carry the day. One side will win. It matters not though, because neither of the two contesting political parties is willing to face reality: The U.S. is not in a so-called great recession. It is in a latent depression. What has stopped it from becoming a full-fledged depression has been the willingness of the elites, both under the Bush II and Obama administrations, to resort to age-old Keynesian policies to stem the hemorrhage -- soup kitchen lines have so far been substituted by government checks in the mail. Some argue that governments' actions have not been enough to stem the recessionary times. Others claim that too much has been done, and time has come to cut spending and taxes in order to let the economy run to its natural ever-growing self. Again, it matters not, whatever position is taken. Do or don't, the economy is not coming back, and it should not. The Republican plan to cut spending (an age-old endeavor) will only bring more pain and social devastation. The Democratic plan to pump up the economy through deficit spending will only delay the actuality that the bind we all are in is a Catch-22. The economy that we have been used to in the past half-century is simply not going to come back. This three-part analysis will attempt to show the historical making of the dire and deepening crisis we all face, then try to demonstrate why the past paradigm won't and shouldn't come back, and end with a few suggestions that hopefully will lead to a future that is not predicated on the dead end the few want the many to embrace. To fully grasp the extent of the current crisis one needs to take a short and much abridged walk through history. Human relationships have long been a story of antagonisms among the haves and the have-nots. In the feudalism era sharecroppers and peasants were peons of landowners and the divine royalties. The rise of the entrepreneurial class with the advent of the Industrial Revolution and capitalism led to a (often violent) change in leadership. The bourgeoisie overthrew the old order and the working masses migrated from the land to the mines and the factories and the shipyards, etc. Working conditions were execrable and the exploitation of the laborers was so prevalent (1) that they benefited the happy few and led to la belle ?poque, the Gilded Age, for the moneyed class whose rate of profits was very high and to labor demands for more equitable sharing of the created wealth and humane working conditions -- demands that were met with recurring violent and bloody repressions. The class struggles, which can be defined in layman's terms as profits for the few vs. the well being of the many (and private property vs. collective ownership), became the order of the era, increasingly influenced by political economists and philosophers. (2) The 1917 Russian Revolution threatened the moneyed class more than ever even though their hold on power with its resulting excesses in the accumulation of wealth could not be tamed until the Great Depression hit. In its wake, reformists like FDR and socialist parties in Europe cut their feathers substantially. Progressive taxation on income, estate, and capital was put in place; salaries among the wealthiest and the average workers trimmed from a ratio of about 400:1 to 30:1; social programs instituted... It must be remembered that workers' rights, unions, public education, health care, Social Security, public services, women's rights, civil rights, secular regimes, etc., are all a legacy of the left, which shed so much blood and tears to achieve these gains (even though the record ought to be tempered by the same left's avocation of the "civilizing mission" in far away lands -- i.e., colonialism). Nonetheless, the moneyed class became so worried about the loss of their privileges and the spread of socialist ideas that they, in Europe and in the U.S., supported Mussolini's Fascism and Hitler's National Socialism until well into World War Two when Hitler, instead of focusing on their interests -- the destruction of the Soviet Union and communist expansion in Europe -- launched an attack on their own countries and interests. In 1945, Europe lay in ruins, its infrastructure and industries devastated, its people impoverished, lacking food and services (like electricity and water). Communist parties, particularly in France and Italy, gained strong traction and the influence of the Soviet Union loomed large. Threatened by the advance of leftist ideas, the powers-that-be chose to join them half way. Western elites devised a reconstruction plan based on Keynesian-Fordism -- state control and planning of the economy to varying degrees, mass post-Taylorism production, progressive taxation, collective bargaining through strong unions, and the transfer of gains in productivity to the salaried work force in the form of higher wages, which greased the wheel of demand for industrial production. The USA was an intimate participant in that process through the European Recovery Program (the Marshall Plan) passed by Congress in 1947, which was motivated by three objectives: First, to create new markets for American products (the U.S. was producing 55% of worldwide manufactured products in 1945 and feared a potential domestic recession could happen if new markets were not developed). Second, to neutralize and work against the growing influence of the Soviet Union and the Communist parties in Western Europe. Third, an altruistic desire to alleviate the dire conditions Europeans faced...which could lead to social unrest and bring on political developments that its second objective aimed to prevent (American idealism has always been mated with a heavy dose of pragmatic self-interest). full: http://www.swans.com/library/art16/ga287.html _______________________________________________ Marxism-Thaxis mailing list Marxism-Thaxis@lists.econ.utah.edu To change your options or unsubscribe go to: http://lists.econ.utah.edu/mailman/listinfo/marxism-thaxis
