Perspectives for world capitalism 2012 (Draft discussion document) – Part SevenWritten by International Marxist TendencyTuesday, 17 April 2012Lenin said that politics is concentrated economics. For Marxists the importance of economics is the effects it has on the class struggle. In the Second World Congress of the Communist International, Trotsky pointed out that every measure the bourgeois take to deal with the crisis will intensify the class struggle.
We see the evidence for this on all sides. In 1921 Trotsky wrote:
"So long as capitalism is not overthrown by the proletarian revolution, it will continue to live in cycles, swinging up and down. Crises and booms were inherent in capitalism at its very birth; they will accompany it to its grave. But to determine capitalism's age and its general condition—to establish whether it is still developing or whether it has matured or whether it is in decline—one must diagnose the character of the cycles. In much the same manner the state of the human organism can be diagnosed by whether the breathing is regular or spasmodic, deep or superficial, and so on." (First Five years of the Communist International, vol.1, Report on the World Economic Crisis and the New Tasks of the Communist International)
Marx explained long ago that no economic system ever disappears before it has exhausted its full potential. Today the capitalist system shows clear signs of its exhaustion. But capitalism has long since ceased to play a progressive role on a world scale. It fulfilled its historically progressive role and has gone far beyond its limits. It is incapable of developing the colossal potential of the productive forces. The present crisis is proof of that.
The two fundamental obstacles to human progress are on the one hand private ownership of the means of production and on the other hand the nation state. There were many factors that caused the post-war upswing. But the main one was the colossal expansion of world trade. This enabled capitalism to overcome—partially and for a temporary period—the limitations of private ownership and the nation state. This tendency was enormously expanded over the last three decades. But now this seems to have reached its limits.
The present crisis is an entirely different situation to what we faced in the past. It is more similar to the situation that Trotsky wrote about in 1938. What we are experiencing is not a normal cyclical crisis of capitalism. It is something far deeper and more serious: an organic crisis of the capitalist system, from which there is no way out, except further crises and deep cuts in living standards.
This is something entirely new, and this explains the perplexity of all the bourgeois economists. They have completely lost their bearings. They resemble the old definition of metaphysics: a blind man in a dark room, looking for a black cat which is not there. The bourgeois is seriously worried. A new recession would be "disastrous," according to Roger Altman, a senior Treasury official in the Clinton administration. "We could be in for a repeat of the experience of 1937, when America fell back into recession after three years of recovery from the Great Depression," he wrote in the Financial Times.
The bourgeois strategists understand that a new global recession will have the most serious social and political consequences. They are increasingly gloomy in their prognostications. The same UBS report quoted earlier warned of the danger of civil disorder as a result of the economic crisis in Europe:
"When the unemployment consequences are factored in, it is virtually impossible to consider a break-up scenario without some serious social consequences. With this degree of social dislocation, the historical parallels are unappealing. Past instances of monetary union break-ups have tended to produce one of two results. Either there was a more authoritarian government response to contain or repress the social disorder (a scenario that tended to require a change from democratic to authoritarian or military government), or alternatively, the social disorder worked with existing fault lines in society to divide the country, spilling over into civil war. These are not inevitable conclusions, but indicate that monetary union break-up is not something that can be treated as a casual issue of exchange rate policy.
"It is certainly worth noting that several countries of the euro area have histories of internal division—Belgium, Italy and Spain being amongst the most obvious. It is also true that monetary union break-ups in history are nearly always accompanied by extremes of civil disorder or civil war." (UBS Global Economic Perspectives 6 September 2011)
The conclusion could hardly be more pessimistic:
"The question is not how a liberal democracy develops, but whether a liberal democracy could withstand the social turmoil that surrounds a monetary union fracturing. We lack evidence to support the idea that it could."
These lines show how concerned the strategists of Capital are. They see the impossibility of reaching a durable social and political equilibrium. They also understand that the normal instruments of bourgeois democracy will be tested to the limits by "extremes of civil disorder."
That is correct, as far as it goes. However, it is unlikely that the bourgeoisie would risk moving directly towards a civil war, either in Greece or any other developed capitalist country. Only after exhausting all other possibilities would the bourgeoisie consider the option of a military coup, which is fraught with dangers for it.
The class struggle
There have been big movements of the class struggle in the recent period, mainly in Southern Europe. Naturally it does not begin in the stronger countries of Northern Europe. But their turn will come, as we can already see in Britain and France.
Already, in the autumn of 2009, there was a huge upsurge against cuts in France with 3.5 million workers on the streets. These protests were not confined to the big cities, but took place in hundreds of small towns: as much as a quarter of the population was on the streets in these smaller areas. Oil refineries were blockaded, and there were big movements in the schools and universities. Moreover, 65-70 percent of the population was in favour of the movement.
This was an anticipation of what is to come. After that we have seen the biggest general strike in Portugal since the 1975 revolution. In Italy we have seen mass demonstrations in Rome and a general strike. In Greece there have been as many as 13 general strikes over one year. In Britain there was the biggest demonstration called by the trade unions in history, followed by the biggest strikes since 1926.
The Governor of the Bank of England, Mervyn King, has said Britain is facing the biggest fall in living standards since the 1920s. Pensions are to be cut by 40 percent while profits are soaring. Barclays bank made record profits, and paid just 2 percent in tax. The incomes of the directors of the top FTSE 100 firms rose by 49 percent in 2011. This is stoking the fires of anger, which was reflected in a wave of riots of the dispossessed youth in London and many other cities.
There have been huge youth movements in Spain, directly inspired by Egypt's Tahrir Square. As in Egypt so in Spain, the high level of youth unemployment is what led to the explosive movement of the indignados. In turn, the Spanish actions inspired a similar occupation of the squares in Greece. Athens was choked with tear gas as the police of the social democratic government dispersed the revolutionary youth. Even in the Netherlands there were 15,000 students protesting at The Hague.
Events, events, events are the key to the situation. And great events are being prepared, which will shake up society to the depths and produce dramatic changes in consciousness. We have already seen this in Tunisia, Egypt, Spain and Greece. Even in Eastern Europe we have seen big movements in Albania and Romania. In Bulgaria, even the police have been out on strike. In Russia we saw the massive increase in votes for the Communist Party, which has started to attract a layer of youth, indicating that there also the situation is beginning to turn. These are extremely important developments that represent a turn in the situation in Europe. Others will follow with a greater or lesser delay, according to the prevailing conditions.
What is true of Europe is also true on a world scale, as is shown by the Arab Revolution and the protest movement in the USA.
For years the so-called Lefts have been bleating about the "low level of consciousness" of the masses. These people are incapable of looking at things dialectically. They are hypnotized by the present situation, and cannot see things in their development and change. Incapable of understanding the real movement of the working class, they are always taken by surprise by events. They are condemned to study history by observing its backside.
This approach has nothing in common with Marxism. It is a mixture of crude empiricism and idealism. They set out from an ideal norm of consciousness and condemn reality because it does not conform to their ideal norm. Hence, for them, the working class is never conscious enough. Yet throughout history revolutions have been made, not by educated pedants but precisely by the "politically untutored masses."
Contrary to the prejudice of the idealists, human consciousness is not revolutionary or progressive, but profoundly conservative. People don't like change. They like stability, because it is more comfortable. They will stubbornly cling to the existing order, its morality and prejudices, to the familiar parties and leaders, until events force them to change.
Profound shifts in consciousness arise out of the experience of the masses. This is not a gradual evolution, but has a violent and convulsive character. Revolutionary consciousness does not develop smoothly in a continuum, from right to left over time. A revolution is precisely that critical point where quantity becomes transformed into quality and there is a sudden leap.
How did revolutionary mass consciousness develop in Russia? When the strike broke out at the Putilov works in 1904, the Bolsheviks and the Mensheviks were not in the lead. In the first stages of the 1905 Revolution it was a priest, Father Gapon – who was also a police agent – with all his backwardness and prejudices who led the movement, precisely because he personified and reflected the stage that the masses had reached.
In the early stage of the 1905 Revolution, the revolutionaries were isolated from the masses, When the Bolsheviks showed up with their leaflets calling for the downfall of the monarchy and the establishment of a constituent assembly, the workers tore up those leaflets and often times beat up the Bolsheviks. But in the evening of the Ninth of January, immediately after the Bloody Sunday massacre, the workers came back to the Bolsheviks with one demand: "Give us guns!"
Every other tendency underestimates the seriousness of the current situation, which has no precedent in recent history. It is true that the consciousness of the workers is lagging behind objective reality. They have not yet realized that this represents a complete break with their past experience. Most people believe that some kind of correction will return the situation to normal. But a writer in The Economist pointed out correctly, "Yes, sooner or later we will return to normality. But it will be a new normality."
There can be no return to the "good old days" when the ruling class in the advanced capitalist countries could grant concessions and reforms to buy class peace. Now all the gains of the European and American working class are under threat. From the standpoint of the bourgeoisie, it is precisely these things that stand in the way of the capitalist class resolving its crisis.
There has already been a dramatic change in consciousness of the ruling class. Twenty years ago they were puffed up with arrogance after the fall of the USSR. Now all that has gone. The old confidence has gone and they are looking to the future with dread. During the boom the capitalists developed delusions of grandeur, especially after the fall of "communism." They really believed that their system would last forever. The alleged superiority of market economics would solve all problems if only the state would leave the market alone to perform its miracles.
Now everything has been stood on its head. At this moment in time the capitalists are completely dependent on the state for their survival. The banks expect their losses to be paid by the state—that is, by the taxes of the working class and the middle class, upon whose shoulders the whole weight of the crisis is to be placed. But this will have profound effects on social relations, politics and the class struggle. This has started already.
In the past, the bourgeois bought social peace by granting concessions, giving a slice of the surplus value produced by the workers back to them. They had sufficient room for manoeuvre to do this on the basis of the enormous profits they extracted during the boom. But this has now disappeared. The only ones who really believe in the market economy are the leaders of the labour movement, who in a period of crisis, constitute the main bulwark of the capitalist system. This will mean that the labour organizations will be shaken by crisis after crisis. Sooner or later, the old right-wing leaders will be spewed out and replaced by other leaders who are more responsive to the pressure from below.
Limits of spontaneity
The millions of people who have come out onto the streets and squares of Spain and Greece to oppose the policy of cuts and austerity do not trust the politicians and trade union leaders. And who can blame them? In both Greece and Spain the governments that are carrying out these attacks are supposed to be "socialist". The masses deposited their confidence in them, and find themselves betrayed. They conclude that in order to defend their interests they must not leave things to the politicians but take action themselves. This shows a correct revolutionary instinct.
Those who sneer at the movement as "merely spontaneous" display their ignorance of the essence of a revolution, which is precisely the direct intervention of the masses in politics. This spontaneity is an enormous strength—but at the same time it can become a fatal weakness of the movement.
Of course, the mass movement will necessarily suffer from confusion in its initial stages. The masses can only overcome these shortcomings through their direct experience of the struggle. But it is absolutely necessary for the masses to pass beyond the initial confusion and naïveté, to grow and mature and to draw the correct conclusions.
Those "anarchist" leaders—yes, the anarchists also have leaders, or people who aspire to lead—who believe that confusion, organizational amorphousness and the absence of ideological definition are both positive and necessary, play a pernicious role. It is like trying to maintain a child in a state of childishness, so that it is forever unable to talk, walk and think for itself.
Many times in the history of warfare a big army composed of brave but untrained soldiers has been defeated by a smaller but disciplined and well-trained professional force led by skilled and experienced officers. To occupy the squares is a means of mobilizing the masses in action. But in itself it is not enough. The ruling class may not be able to evict the protesters initially by force, but they can afford to wait until the movement begins to die down, and then act decisively to put an end to the "disturbances".
It goes without saying that the Marxists will always be in the first line of any battle to improve the conditions of the working class. We will fight for any conquest, no matter how small, because the fight for socialism would be unthinkable without the day to day struggle for advance under capitalism. Only through a series of partial struggles, of a defensive and offensive character, can the masses discover their own strength and acquire the confidence necessary to fight to the end.
There are certain circumstances in which strikes and mass demonstrations can force the ruling class to make concessions. But this is not one of them. In order to succeed it is necessary to take the movement to a higher level. This can only be done by linking it firmly to the movement of the workers in the factories and the trade unions. The slogan of the general strike comes to the fore. But even a general strike in and of itselfcannot solve the problems of society. It must eventually be linked to the need for an indefinite general strike, which directly poses the question of state power.
Confused and vacillating leaders are capable of producing only defeats and demoralization. The struggle of the workers and youth would be infinitely easier if they were led by courageous and far-sighted people. But such leaders do not fall from the skies. In the course of struggle, the masses will put to the test every tendency and leader. They will soon discover the deficiencies of those accidental figures who appear in the early stages of the revolutionary movement, like the foam that appears on the crest of the wave, and who will vanish just like that foam.
Through their experience, an increasing number of activists will come to see the need for a consistent revolutionary programme. This can only be provided by Marxism. Ideas which for decades were listened to by small groups will be eagerly sought out, first by hundreds, then by thousands and hundreds of thousands. What is required is, on the one hand, the patient preparatory work of the Marxist cadres, on the other hand, the concrete experience of the masses themselves.
Tactics and strategy
Tactics and strategy are different things, and may even, apparently, contradict each other under certain circumstances. Our long-term strategy is very clear and we must maintain it. When the masses begin to move, they will turn in the first place to the existing mass organizations of the working class. But in order to build the Marxist tendency it is not enough merely to repeat correct general propositions. We must proceed from the concrete conditions of the movement at any given stage. And these conditions do not remain the same but change constantly.
Tactics by their very nature have to be flexible, and we must be able to change them within 24 hours, if necessary. In warfare, strategy might involve attacking a certain position. But if that position is too well-defended, and our forces are not sufficiently strong to take it, we will have to reconsider our tactics. Instead of a frontal attack on the position, we may decide to concentrate our forces on a secondary, but more accessible objective. Having secured that objective, we will be in a stronger position to return to the main point of attack.
The new situation has not yet found a reflection in the mass organizations, with the exception of the unions, which stand closer to the class than the parties. Certain things flow from this. If the mood of anger in society does not find an outlet in the mass organizations, it will find other manifestations.
Movements like the indignados in Spain arise because most workers and youth feel they are not represented by anybody. These people are not anarchists. They display confusion and lack a clear programme. But then, where would they get clear ideas from? These spontaneous movements are the consequence of decades of bureaucratic and reformist degeneration of the traditional parties and unions. In part, this represents a healthy reaction, as Lenin wrote in The State and Revolution, when he referred to the anarchists.
With their usual impressionism, the sects are completely intoxicated by these new movements. But we must not allow our judgement to be clouded by ephemeral phenomena. We must also understand that these movements have limitations that will quickly be exposed by experience itself. The new movements are alienated from the mass organizations, feeling they do not represent them. On the other hand, the new movements themselves have not understood the seriousness of the situation. They are trying to pressure the bourgeois government to change policy, not understanding that the situation does not allow that. This will ultimately lead them to a dead end.
At a certain stage, these new mass movements will subside, leaving the mass organizations as the only mass political expression for the workers. The mass pressure on these organizations will grow, shaking them from top to bottom. There will be a series of crises and splits, which will lead to the growth of a mass left wing at a certain stage. We must always bear this firmly in mind if we are not to degenerate into an isolated sect.
The fate of the sects should serve us as a warning. They are in crisis because all their attempts to build "revolutionary" parties outside the traditional mass organizations of the proletariat have ended in ignominious failure, although the objective conditions for this were as favourable as they will ever be. Their failure to understand the way in which the working class moves dooms them to impotence. They will be swept aside as soon as the class begins to seriously move.
The movement of the masses can only be through the workers' traditional organizations. Of course, this process does not take place overnight or in a straight line. There will be many zigzags and contradictory developments, and that is why our tactics must be flexible. But ultimately, the main developments will flow through the mass organizations.
A new world war?
The bourgeoisie now finds itself in the deepest crisis in its history. But we must be careful how we explain this. Lenin pointed out that there is no final crisis for capitalism. History shows that the capitalists can always find a way out of even the deepest crisis, unless they are consciously overthrown by the working class. But the bare assertion that the capitalists can find a way out of the present crisis tells us nothing. What we must ask is: how long will this take, and what will be the cost?
In 1939, they resolved the crisis through war. Can they do this again? Polish Finance Minister Jacek Rostowski, whose country currently chairs EU meetings, told the European Parliament in Strasbourg. "If the eurozone breaks up, the European Union will not be able to survive." He even warned that war could return to Europe if the crisis undermined the EU. Certainly, all the contradictions are coming to the fore. However, the perspective is not of a new world war, as in 1914 or 1939, but an intensification of the class war.
The analogy with 1939 is superficial and misleading. The situation is not at all comparable. In the first place, the war in Europe was only possible after a series of decisive defeats of the working class in Italy, Germany, Austria and Spain, as Trotsky explained. The class balance of forces is now completely different. The workers' organizations are largely intact, and the bourgeoisie cannot turn immediately towards reaction in the form of military police states.
Apart from the class balance of forces, which is the main reason a world war is ruled out, there is another reason why the European ruling class will not lightly move in the direction of fascism or Bonapartism. They burned their fingers badly in the past when they handed power to a gang of fascist adventurers and unbalanced dictators. In the case of Germany, it led to a disastrous defeat in war and the loss of a big part of their territory. A more recent case was the Greek Junta that took power in 1967. That ended in a revolutionary uprising in 1973. They will think twice before repeating the experience. Only if the workers are decisively defeated would the prospect of dictatorship arise.
In addition to the internal balance of class forces, one must also take into account the balance of power between the main nations. In order to deal with the question of war, it is necessary to pose it concretely: who is going to fight whom? This is a very concrete question! There are tensions between Europe and the USA, which can lead to trade wars in the future. But the crushing superiority of the USA means that no power on earth can take it on in a war. All the European countries together cannot wage war on the USA.
Despite its industrial muscle, Germany is in no position to invade Russia as it did in 1941. On the contrary, it is increasingly subordinate to Russia's interests in Europe. We see a similar change in Asia, where formerly backward China has become a formidable industrial and military nation. Can Japan invade China like they did in the 1930s? Just let them try! This is not the same China as in 1930. For the same reason, the USA cannot hope to reduce China to a position of colonial slavery, as it planned to do in the past.
There are growing tensions between different countries. China is engaged in massively increasing military spending. Beijing is buying an aircraft carrier and developing long-range missiles. To counteract this, the US is holding joint military manoeuvres with Vietnam and deploying more troops in the region. Vietnam is also strengthening its military fire power, ordering submarines and jets from Russia. There are serious tensions on the Korean peninsula, as a result of the severe crisis of the North Korean regime, which could implode at any moment. The Chinese are concerned about this, fearing that the regime could collapse on their border. Under certain conditions these fault lines could erupt into military conflicts. But a world war between the major powers is ruled out.
On the other hand, the world crisis means that there will be small wars all the time—like the wars in Iraq and Afghanistan. These will add to the social discontent and exacerbate the class struggle in Europe and the USA. The power of US imperialism is colossal but it is not unlimited. We can see the limitations of US military power in Iraq and Afghanistan. They only attacked Iraq when its army was effectively broken by years of blockade. Even then, the attempt to hold Iraq in subjugation was defeated by a guerrilla war. The mightiest power on earth, after preparing to leave Iraq, will also be forced to withdraw from Afghanistan, leaving a chaotic situation behind it.
The threat of reaction?
We have pointed out repeatedly that all the attempts of the bourgeois to restore the economic equilibrium will destroy the social and political equilibrium. Greece is proof of this assertion. Already social and political stability have been destroyed. And the realization that all the sacrifices have been in vain will make the austerity utterly intolerable. The result will be a turbulent period of revolution—and counterrevolution—that can last for years.
The working class will suffer many hard knocks which will shake up the consciousness of the workers and youth and toughen them up. The horrific events in Norway are a warning of what is to come. Formerly peaceful, prosperous, democratic, Nordic Norway, which had seemed invulnerable to crisis, was convulsed by the murder of Young Socialists perpetrated by a fascist gunman. The truth is that relations between the classes in the Scandinavian countries were somewhat softened after World War II.
The absence of big class battles blunted the sharp edges of the class struggle. This softness has had a corrosive effect within the labour movement with the spread of alien class ideas: feminism, pacifism, and other petty bourgeois ideas have penetrated the movement and have had a debilitating effect. And this is not just the case in Scandinavia.
For decades it appeared that the Scandinavian countries were models of peaceful reform. That's what they thought in Norway until this comfortable schema was overturned by the terrible massacre of the Labour Youth.Despite the verdict of a Norwegian court, this was not the act of a single madman. It shows the contradictions that have built up within capitalism and that threaten to destroy the internal cohesion and stability of even the most developed capitalist states, not excluding the USA itself.
In the 1970s, the Gladio Conspiracy showed just how fragile a plant bourgeois democracy is. The bourgeoisie can pass from democracy to dictatorship as easily as a man passing from one carriage of a train to the next. However, in order to do this, certain conditions must be fulfilled. Just as there are laws that govern revolution, so there are laws that govern counterrevolution. The capitalists cannot simply go over to dictatorship because they wish to do so, any more than we can carry out the socialist revolution because we desire it.
The U.S. Central Intelligence Agency warned in a report that the tough austerity measures and the dire situation could escalate and even lead to a military coup in Greece, according to a report by Germany's popular daily Bild. According to the CIA report, on-going street protests in crisis-hit Greece could turn into escalated violence and rebellion, and the Greek government could lose control. The newspaper said the CIA report talks of a possible military coup if the situation becomes more serious and uncontrolled.
It is possible that a section of the Greek ruling class is toying with the idea of finding a solution to their problems by moving towards reaction as they did in 1967. However, the Greek workers remember 1967 and the crimes of the Junta. Any move in that direction now would provoke civil war. This is recognized by an American political analyst, Barry Eichengreen (Professor of Economics and Political Science at the University of California, Berkeley) in a recent article, significantly entitled: Europe on the Verge of a Political Breakdown: "In Greece itself, political and social stability are already tenuous. One poorly aimed rubber bullet might be all that is needed to turn the next street protest into an outright civil war."
Barry Eichengreen is not alone. Paul Mason, the economics editor of BBC2's Newsnight writes: "In the chancelleries of Europe, above all in Berlin, these are questions that are impossible to mention. There is a total mismatch between political expectation and what is imminent. It reminds me—as so much of 2011 reminds me—of 1848. Metternich sneering out of the window at the irrelevant mob, a few hours before his unceremonious overthrow, Guizot unable to breathe with shock as he resigns his ministry, Thiers, prime minister for one day, suffering a bout of 19th Century Tourette's in his carriage, hounded by the masses…"The most intelligent bourgeois strategists are seriously alarmed by the developments in Greece. The problem is not so much that this could lead to civil war. The problem is that the Greek bourgeoisie would not be sure of winning such a war. The working class is undefeated. Behind them they feel the support of the mass of the Greek population—not just the workers and peasants, not just the students and intellectuals, but also the small shopkeepers and taxi drivers and even many retired military officers who are driven to revolutionary conclusions by the sudden collapse of their living standards....