Reflections on Loren Goldner’s article The Biggest ‘October Surprise’ Of All: A World Capitalist Crash

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The idea that capitalism, like Roman slavery or mediaeval feudalism, is a transient system, condemned to disappear through the working out of its own contradictions, is fundamental to what Marx called the materialist conception of history. In the Communist Manifesto of 1848, Marx and Engels discerned in the crises of overproduction that regularly shook the edifice of capitalism the fatal disease that would lead to the decline of a system then still marching triumphantly across the globe; and this in turn would confront the revolutionary class in capitalism, the proletariat, with the necessity to overthrow it and build a new form of society. In that famous text, in fact, they made a premature diagnosis that already "the conditions of bourgeois society are too narrow to comprise the wealth created by them". This plainly contradicted other elements of the Manifesto where they still saw the bourgeoisie playing a revolutionary role and thus defended the need for the proletariat to support its more progressive elements in the struggle against the remnants of feudal rule.  Capitalism's formidable growth following the crises of 1848 led them to revise the diagnosis, but they never abandoned the view that the communist revolution was only placed on the agenda of history at the point where "the productive forces at the disposal of society no longer tend to further the development of the conditions of bourgeois property".

In the last decades of the 19th century, as capitalism continued to conquer the globe, bringing with it substantial increases in working class living standards, the ‘revisionist' current within the workers' movement began to argue that capitalism would be able to grow indefinitely and that as a result the movement should be more realistic, renouncing its revolutionary goals in favour of a gradual struggle for reforms or, at best, a struggle for a gradual evolution towards socialism. In the German social democratic party, Rosa Luxemburg led the fight against this current, especially in her pamphlet Social Reform or Revolution, written in 1900, where she reaffirmed the Marxist thesis that the socialist revolution could only be a "historic necessity" imposed by the opening of a period in which capitalism had become an out and out obstacle to the needs of humanity. And indeed the conditions of the 1890s - in particular, the development of imperialism - allowed her to put forward a very clear assessment of the period on the horizon:  

"on the one hand we now have behind us the sudden and large opening up of new areas of the capitalist economy, as occurred periodically until the 1870s; and we have behind us, so to speak, the previous youthful crises which followed these periodic developments. On the other hand, we still have not progressed to that degree of development and exhaustion of the world market which would produce the fatal, periodic collision of the forces of production with the limits of the market, which is the actual capitalist crisis of old age. We are in a phase in which the crises are no longer the accompaniment of the growth of capitalism, and not yet that of its decline".

As it turned out, the first decisive evidence that the system had entered into its epoch of decline was not an overt economic crisis, but an imperialist war of unprecedented savagery and destructiveness. But the vast majority of the revolutionaries, who - unlike the revisionist trend and the right wing of social democracy - remained loyal to internationalist principles when the war broke out in 1914, were also emphatic that the war demonstrated precisely that capitalism had now entered a new epoch: as the Communist International put it at its founding congress in 1919." The epoch of capitalism's decay, its internal disintegration, the epoch of the proletarian communist revolution". Their conclusions were confirmed by the revolutionary events that followed the war, by the economic stagnation which, with the exception of the US, affected the advanced capitalist countries in the 1920s, the cataclysmic stock market crash of 1929 and the world-wide depression that followed, and by the outbreak of a second world war which proved to be even more barbaric and destructive than the first. Virtually all the political currents which laid claim to Marx's historical method concluded from these events that capitalism was indeed a mode of production in decay.

It was only with the economic boom that followed the second world war that groups which more or less located themselves within the Marxist tradition - most notably the French group Socialisme ou Barbarie - began to question the ‘dogma' of the inevitable economic crisis and to look for other possible driving forces of the proletarian revolution: in the case of SouB, the rebellion of ‘order takers' against the small caste of ‘order givers', or with the Situationists, a movement of revolt against the sheer boredom of the ‘spectacular commodity society'.

It should be recalled that these new ‘revisions' of Marx's theory were formulated in a general ideological atmosphere in which the bourgeoisie itself was also proclaiming the end of economic crises, the advent of a more or less classless consumer society, the ‘embourgoisement' of the working class, and so on. This ideology was severely shaken by the return of the open economic crisis, which had been noted by a few in the late 60s but which had become embarrassingly obvious after 1973, and by the wave of workers' struggles which swept the globe in the wake of the events of May-June 1968 in France. This resurgence of class consciousness also expressed itself in the appearance of new revolutionary groups, a number of which, in rediscovering the traditions of the workers' movement, also came upon the lost history of the communist left, the current which, in the 1920s-40s, had most clearly drawn out all the political consequences of the decadence of capitalism.

But the crisis which came to the surface in the late 60s showed that the bourgeoisie had learned a great deal from the experience of the great depression. Unlike the discredited Hoovers and Coolidges of the late 20s, it would never again trust to the unfettered operation of the market to restore the economic balance disrupted by the crisis. Implicitly or explicitly, it had recognised that it was now living in the epoch of state capitalism and that there was no going back to the ‘laisser faire' approach of the 19th century. With the state intervening to support the economy with massive injections of credit, openly nationalising the weakest sectors and coordinating these manipulations on an international scale, the crisis has unfolded above all as a ‘slow motion' descent, with periods of recession punctuated with bursts of credit-led boom.   

This is the context in which a new generation of individuals searching for revolutionary ideas have been born, and it has profoundly affected their view of the real depth of capitalism's crisis - along with other factors, such as the weight of anarchist ideas engendered in reaction to the nightmare of Stalinism: anarchism has always had a strong tendency to insist that the revolution is possible at any moment, regardless of the historical, material conditions of the day. It has been a hard struggle convincing many of these elements that capitalism is indeed locked in a historic crisis; in the online debates on www.libcom.org, for example, we find ourselves again and again coming up against the view that capitalism passes from one crisis to the next in a purely cyclical manner - in essence that the crises of the 20th and 21st centuries are no different from the youthful crises of capitalism, and remain a necessary precondition for the further expansion of the system.

Goldner's view of crisis and decadence

In our view, the latest phase of the crisis, summed up under the short-hand ‘credit crunch', will certainly be a factor in challenging such views and convincing people that we are seeing the real putrefaction of capitalism as a mode of production. In this context, we welcome a recent contribution by Loren Goldner, who would describe himself as part of a "left communist mood" which has been growing in the recent period.  The essential approach of The Biggest ‘October Surprise' Of All: A World Capitalist Crash (http://home.earthlink.net/~lrgoldner/october.html) is to show:

  • - that behind the financial crisis, the whole mad spiral of toxic debt which Goldner aptly describes as the world's biggest ever ‘Ponzi scheme' (or pyramid-selling scam) lies something far more fundamental: "a crisis of social reproduction" as Goldner puts it;
  • - that this crisis is not a passing affair but has been more or less permanent since the end of the 1960s: "I would argue that from these late 1960's signals of the end of the previous era of expansion onward, world capitalism has been basically ‘running on empty', with ever increasing credit pyramiding of unbelievable and unprecedented proportions being the main ‘motor' of ‘growth', paid for by ever-increasingly social retrogression of every kind, that we can call CONTRACTED social reproduction, or non-reproduction on a world scale."

  • - that this in turn is the expression of capitalism's decadence as a mode of production: "Around the time of World War I in 1914, capitalism reached a certain point in history at which it ceased to be a progressive mode of production on a world scale. Historically we see that in the first century of capitalism's existence from the early 19th century to 1914, there was a steady development of productive forces, and a growth of the productive working class on a world scale, in those areas that were fully capitalist. In that period, capitalism got to a stage where that kind of development could no longer happen in a peaceful evolutionary manner. (To periodize capitalism in this way is in no way to overlook its historical crimes, including the centuries of the African slave trade and the pillage and depopulation of the New World.)"
    The article does not deny that within this epoch, there have been periods or areas of considerable growth (Japan and the USSR in the 30s, western capitalism during the post-war boom, China today), but these phenomena have to be seen in the wider context of the barbaric history of the 20th and 21st centuries as a whole: "Starting in the 1970's and particularly 1980s, South Korea and Taiwan did in fact evolve into effectively first world countries, but these were special cases permitted by the U.S. as showcases to compete with the appeal of China and North Korea (the latter being more developed than South Korea until the 1970's). Since then, Hong Kong, Singapore and later China and Vietnam have followed the South Korean and Taiwan models, but this has to be offset against decline and stagnation in the US and Europe, as well as against outright retrogression in Eastern Europe, Russia, Central Asia, the non-oil countries of the Middle East, black Africa and Latin America. So,unlike the period prior to 1914, the rise of the Asian Tigers has not been expansion on a world scale but it was growth here and decline there.

    Historically, we can consider the period from 1914 to 1945 to be mainly lost decades for capitalism as a system, just more or less permanent crisis, war, reaction, destruction, and so on. There was to be sure exceptional growth in Japan, tied to its expansion into China, and some technological innovation, as in the US and Germany during the ‘rationalization movements' of the 1920's (always tied to historically high unemployment of 8-10%, that being the point), and even (e.g. the US auto industry) during the 1930's depression. Latin America from 1929 to 1945 built its ‘import substitution' populism behind high tariff walls. And we should not forget the Stalinist forced-march industrialization of the Soviet Union which killed upwards of 10 million peasants in the collectivizations, crippling Russian agriculture for the remainder of the Soviet period, and which placed factory speedup under the management of the GPU (the Soviet secret police). Quiet aside from World War I (20 million dead) and World War II (80 million dead), the ‘purely economic' character of the period was these local spurts of growth offset by the larger preponderance of crisis, stagnation and retrogression in the world as a whole".
  • - that the roots of this decadence has to be sought in the underlying contradictions of capital - in the very relationship between wage labour and capital, and can only be overcome by abolishing that relationship. Basically Goldner shows that capital, which operates through the generalisation of the law of value, has become a fundamental barrier to the development of the potential locked up in the very productive forces it has set in motion, providing several concrete examples: the fantastic waste involved in unproductive economic activity (finance, arms, etc), the inability of capitalism to introduce non-polluting technology and to reduce the working day to what is already technically feasible if production was geared to need and not profit. Here Goldner's view corresponds to a very lucid passage in Marx's Grundrisse, which clearly anticipates the obsolescence of capitalism by viewing it from the angle of labour productivity: "Beyond a certain point, the development of the powers of production becomes a barrier for capital; hence the capital relation a barrier for the development of the productive powers of labour. When it has reached this point, capital, i.e. wage labour, enters into the same relation towards the development of social wealth and of the forces of production as the guild system, serfdom, slavery, and is necessarily stripped off as a fetter."
  • - that abolishing capitalist social relations requires a restatement of the communist programme, which Goldner tries to concretise in a series of revolutionary measures which have as their basic aim the overcoming of the criminal waste and destructiveness inscribed in the present system, and using humanity's productive powers for human ends.

These elements are fundamental: they help to show that the crisis today is not the same as it was in the 19th century; and although Goldner somewhat ambiguously keeps open the possibility of a new boom based on the reorganisation of the world market, he sees no way that this can happen peacefully. In fact (and Goldner does not really draw this out), a new violent re-division of the world market would unleash such destructive powers that it is extremely unlikely that there could be any ‘recovery' in its wake - far from being a re-run of the second world war and the ensuing boom, it would more likely end in the destruction of civilisation.

The roots of the crisis

Naturally there are other points in the text which we don't share or find inadequate. Goldner bases his analysis of the origins of decadence on the tendency for the rate of profit to fall, which results from the necessity for capital, driven by competition, to reduce the amount of living labour, sole source of profit, in favour of the dead labour of machines. Marx certainly saw this as one of the contradictions which would transform capital into a barrier to itself (the passage from Grundrisse cited above comes precisely after a section explaining the consequences of the falling rate of profit). But Marx also looked deeply into the crisis of overproduction, no less rooted in the wage relation since the working class in the very act of producing surplus value produces a surplus of commodities for which it can never constitute a sufficient market. This ‘market problem' was further analysed by Rosa Luxemburg in her Accumulation of Capital; and although Goldner has recently written fairly extensively about the "continuing relevance of Rosa Luxemburg" there is no hint of her analyses in this text. It is important to relate these two sources of capitalist crisis because Marx saw ‘foreign trade' (the opening up of new markets by an outwardly expanding capitalism) as one of the factors that would offset the falling rate of profit. The question posed by the historical development of the world economy is this: what happens when capital considered as a totality no longer has any ‘foreign trade' - no relations outside itself. This is actually hinted at in Goldner's text when he writes "In the world then dominated by the capitalist system, the total productivity of labour was too high to be contained within the capitalist form", but he doesn't develop the point any further in relation to the problem of realising surplus value on the market. 

Marx in Vol 34 of the Collected Works (page 221) touches on this question with regard to the relationship between a single country and the world market; but the same problem is posed again and indeed magnified if we treat the whole of capitalism as a single country:  " The domination of production by exchange value appears for the individual in such a way that his production 1) is not directed towards his own needs, 2) does not directly satisfy his needs; in a word, he produces commodities, which can only be converted into use value for him after their conversion into money. But this now appears in such a way that the production of a whole country is not measured by its direct needs, or by such a distribution of the different parts of production as would be required for the valorisation of the production. With this, the reproduction process is dependent not on the production of mutually complementary equivalents in the same country, but on the production of these equivalents in foreign markets, on the power of absorption and degree of extension of the world market. This provides an increased possibility of non-correspondence, hence a possibility of crises". If the world market's "power of absorption and degree of extension" comes up against definite limits, as it began to do at the beginning of the 20th century, then crises become more than a possibility, they become a fatal disease, and no longer constitute the growing pains needed for an automatic phase of further expansion as they did in the 19th century. Hence the chronic and semi-permanent nature of crises in the 20th and 21st centuries.

On the conditions of the class struggle

When it comes to the perspectives for the class struggle that the deepening of the crisis is opening up, we are in substantial agreement with Goldner when he writes:  "This crisis, expressing the profound disarray of the capitalist class, offers the anti-capitalist radical left its biggest opening since the defeat of the world working-class upsurge following World War I.  Then, it was a century of British world domination and a phase of capitalist accumulation that was tottering, with rising American dominance in the wings; today, it is the decades of American world domination and of the 30+ years of decay represented by the ‘Washington consensus' that are up for grabs, and-most crucially, and for reasons indicated by the preceding analysis-NO SUCCESSOR POWER waiting in the wings.  That ‘fact' throws open a struggle for both a reorganization of world capital and a possible new working-class ‘storming of heaven'. The biggest capitalist crisis since 1929 may just be preparing the biggest working-class revolt since 1919".

In contrast to the crash of 1929, the present convulsions of the capitalist system are being experienced by a working class that is historically undefeated and far less likely to make the sacrifices that capitalism will demand of it, whether economic or military.

However, when it comes to grasping the dynamic of the movement towards a revolutionary outcome, it seems to us that Goldner draws some questionable conclusions from the consequences of the ‘deindustrialisation' which has dissipated many of the core industrial sectors of the working class in the advanced countries.  It is certainly true this process has posed serious problems for the working class in terms of retaining and developing its sense of class identity; and it is also true, as Goldner points out, that that the bloating of unproductive and useless forms of economic activity over the past few decades means that it makes little sense for workers to simply take over a good proportion of the enterprises that function for capital today - many of them will have to be simply dismantled. But in the following passage, Goldner seems to be in danger of throwing out the baby with the bathwater:

"The old ‘imagination' of working-class revolution was a general strike or mass strike, occupation of the factories, establishment of workers' councils and soviets, the political overthrow of the capitalist class, and henceforth a direct democratic management of socialized production. This ‘imagination' was based on the experiences of the Russian, German, Spanish and Hungarian revolutions and revitalized by the American, British and French wildcat movement from the 1950's onward, the French May-June general strike of 1968, the Italian worker rebellion from 1969 to 1973, the worker rebellions in Portugal and Spain in the mid-1970's ‘transitions'...I think this model has lost touch with contemporary reality, at least in the West (in contrast to China and Vietnam) because capital-intensive technological development, downsizing and outsourcing have reduced the ‘immediate process of production' (the ‘volume I' reality of capitalism) to a relatively small part of the total work force (not to mention total population), and even the production workers who remain are often involved in making things (e.g. armaments) that would have no place in a society beyond capitalism. More contemporary workplaces would be abolished by a successful revolution than would be placed under ‘workers' control'."

The problem with this is that too many different things are thrown together. In the first place, occupying the factories - regardless of whether they produce useful or noxious products - was never more than a tactic that could be used by the workers to take the revolution forward provided that the immediate ‘self-management' of production did not become a goal in itself, turning isolated occupations into a trap. By contrast, the dynamic of the mass strike, the formation of the workers' councils, and the political overthrow of the capitalist class remain crucial to any future revolutionary process. It is true that the forms taken by the mass strike and by the councils may well differ from those we have seen in previous revolutionary upsurges. Indeed recent massive upsurges - such as the anti-CPE movement in France in 2006 and the steelworkers' strikes in Vigo in Spain the same year - have given us some indication of how mass assemblies and council-type bodies may appear in the future. But despite the changes that have taken place (the Spanish steel workers, for example, used the form of the street assembly to bring together workers from smaller enterprises; in the anti-CPE movement the universities functioned as a nodal point for discussions that were open to other sectors of the class, and so on) the essential content underlying these forms remains the same as in 1905 or 1917.  Goldner himself still refers to ‘soviets' when he talks about the bodies that will undertake the revolutionary transformation. The problem is that by sweepingly dismissing the ‘old model' rather than asking which elements of the class struggle remain constant and which more ephemeral, he leaves little point of connection between today's defensive struggles and the post-revolutionary stage when the social and economic transformation of the world can be posed in earnest.  The list of measures in the final section thus appear somewhat abstract and separated from the ‘real movement'; and at the same time, there is actually little attempt in the text to draw out what can be learned from some of the recent experience self-organisation. No doubt the development of movements like the revolt of the young proletarians in Greece will provide much material for reflection about the forms and methods that the class struggle is going to adopt in the period ahead of us.

We could say more about the specific social and economic measures which Goldner advocates, but that could be discussed another time. The most important issue of the day is the nature of the present crisis, and it is here that Goldner has made his most useful contribution.

Amos 12/08

Comments

Deindustrialization

A very insightful critique of Goldner, but it would have been nice to hear more about what the ICC thinks about the effects of the de-industrialization Goldner mentions. The article says, " (it) is certainly true this process (de-industrialization) has posed serious problems for the working class in terms of retaining and developing its sense of class identity (...) What exactly does the ICC mean by this? What are the implications?

deindustrialisation

Thanks for your comments. Examples of de-industrialisation affecting class identity: the liquidation of the mining industry in Britain and the dispersal of the miners with their long traditions of struggle; the same for the car and steel industry, the docks, etc. Contrary to the dominant ideology, this doesn't mean the 'end of the working class' because the majority of those who worked in these sectors have to sell their labour power elsewhere or join the ranks of the unemployed, but they often have to work in more atomised sectors without the same traditions of struggle. Class identity has also been attacked ideologically over the past few decades with all the campaigns about the end of the working class so there is a real challenge posed for the 'reconstruction' of a class identity, which will come mainly through the revival of the class struggle, often in sectors less accutomed to collective action.

Interesting response. So

Interesting response. So deindustrialization can have a serious impact on the working class' ability to find its identity, but cannot eliminate it, nor does it make the working class irrelevant. But I wonder just how severe the impact has been after 30 plus years of this process? Listening to the bourgeois media, one has to wonder how much industry is left to dismantle.

How much industry?

Well, according to the CIA World Factbook (and I'm absolutely sure that better/less biased sources exist) "Industry" [examples given there include: machine tools, electric power equipment, automation equipment, railroad equipment, shipbuilding, aircraft, motor vehicles and parts, electronics and communications equipment, metals, chemicals, coal, petroleum, paper and paper products, food processing, textiles, clothing, other consumer goods] made up 23.4% of Great Britain's GDP in 2007, and industrial production actually grew 0.5% in the same year.

Apparently, even with all the dismantling and deindustrialization going on, it is by no means complete.

Your and Loren Goldner's Analyses

01-20-2009
Tuesday

Dear Comrades:

I read the analysis of comrade Amos on comrade Loren Goldner's piece with interest. I first must read comrade Goldner's piece, and acknowledge offhand I have not.

Additionally, hoping I will not automatically be cast into outer darkness by the left communist comrades, I also acknowledge my past 4-5 years political schizophrenia between left communism on one side, and Trotskyism on the other side.

Having written these words, I'd like to suggest a possible solution to what may only be an apparent dilemma.

What appears offhand to me to be a solution is, the distinction between productive, and unproductive, labor -- that is, the distinction between labor actually involved in production of surplus value verus labor not so involved.

In the U.S., from which I write, all the way back to the early congresses of the Communist International, revolutionary Marxists like comrade Trotsky noted that already as of that moment in time, service workers were displacing industrial workers in the U.S., and had substantially displaced industrial workers in the U.S. even as of then.

Service workers, of course, are far more closely and palpably connected with industrial workers in the production of surplus value. Teamsters, for instance -- truckdrivers, warehouse workers -- directly contribute to the production of surplus value.

The entire financialization of capitalism in the U.S. stemming back over the past 40 or so years is still a kind of edifice of literally negative value -- nonexistent value -- "produced" by entirely nonproductive sectors of labor who do not even rise to the level of those sections of service workers who directly and palpably contributed to the real production of real surplus value.

Consequently, it seems to me that the perspective of workers' councils, the seizure of the means of production by councils (soviets as the Russians called them, "sindicati," as the Italians called them, councils as the Germans called them, etc.), the establishment of a revolutionary workers' government comprised precisely of the councils administering a socialist planned economy, retains its legitimacy and correctness, because if the underlying means of production of surplus value are seized, and if the sections of means of distribution involved in the production of surplus value are seized, pretty much everything else follows.

Put in other words, the core industrial surplus value-producing sections of the proletariat still remain the core sector of the working class to whom revolutionaries ought to orient, as well as to those sections of service and distribution workers who service the industrial and manufacturing sector.

These are just some idle thoughts, but it appears to me that all the financialization and Ponzi scheme-based forms of the past 40 or 50 years can't survive without the underlying surplus value-producing industrial and manufacturing base, even if a shrinking base it is.

This also, it seems offhand to me, translates into a new appreciation of just how much in surplus value the actual real surplus value-producing proletarians have produced. It's far out of proportion to their formal numbers. But it is going to be their mass strike activism, their council formation, their coming to revolutionary consciousness, which is going to shape the nature of the coming national and international proletarian communist revolution here and worldwide.

There may be $600 trillion in derivatives sitting out there, but that's essentially b---s--t "capital" and b---s--t "value" or "wealth," or most of it probably is. That will, in the course of the coming seizure of the underlying surplus value-producing means of production (the core manufacturing and industrial means of production, as well as the service/distribution sectors servicing that), demonstrate the essential vapidity and emptiness of this titanic Ponzi scheme-based pseudo-economy.

Comradely greetings,
Al (Allan) Greene
Email: [email protected]
Former Member: SDS (Students for a Democratic Society), 1964-1969
Former Member: Socialist Party and Young Peoples Socialist League Left-wing, 1965-1967
Former Member: Independent Socialist Clubs of America a/k/a International Socialists (Today International Socialist Organization) Left-wing, Late 1965-1973
Former Member: Spartacist League of the U.S., 1973-1976

Reply to Myself on Productive v. Unproductive Labor

01-20-2009
Tuesday

Dear Comrades:

This is a "reply to myself" on the post I just posted to immediately add one point.

Living in the U.S., despite the election of a black president, racism and racial segregation remained institutionalized and won't be smashed till the coming of the proletarian revolution in this country and the smashing of racial segregation in the course of the smashing of capitalism, and this sort of perspective gives to the black proletarians of our country a particularly emphatically leadership role in the coming proletarian communist revolution, which will have a racially integrated communist organization at its head, but will probably in the very dynamics of it have a very large black component even possibly outstripping workers of other colors in it as well, simply because of the historical traditions in this country impacting on revolutionary dynamics.

Given that, I would like to emphasize the section of distribution and service workers servicing the industrial sector particularly involved in the transit industry, who are heavily black, as a key element in the proletariat to whom revolutionaries particularly in the U.S. ought to orient.

Just thought it necessary to add that point.

Comradely greetings,
Al (Allan) Greene
Email: [email protected]

how this affects class struggle

How much productive industry? Some bourgeois commentators said that UK can’t take sufficient advantage of falling pound in exports because its industrial base has shrunk so far – but as Zimmerwald points out, it still exists, and as Al points out capitalism cannot exist without it. But how does this affect our analysis of class struggle?

Capitalism exists still, there is still a working class. Where it is strongest is not just a question of productivity but also of consciousness: its sense of class identity, of solidarity, and ability to organise. It is also a question of its ability to learn from its past struggles, and one of the most important lessons has been that even the strongest concentrations of the most productive workers can lose the most determined and militant struggle if it is kept isolated on one industry. This was certainly the case with the miners’ strike in Britain in the 1980s when the unions kept solidarity limited to demonstrations and prevented any linking up with the dockers’ and car workers’ strikes that went on at the same time – and we all know about the defeat of that strike. On the other hand, the students struggling against the CPE in France in 2006 threatened to spread the struggle to workers and that was key to the withdrawal of this attack.

So, when we are analysing the development of the capitalist crisis it is very important to have an understanding of how much of the economy is unproductive, but when we are analysing the development of the class struggle it is even more important to emphasise what unites workers in any sector of the economy.

Deindustrialization

The world has not deindustrialized but the technical composition of production capital has been changing. Production capital has become progressively less able to absorb the mass of workers-in-becoming, resulting in a growing number of semi-proletarians* or, if you like, 'informal sector' of petty commodity producers who, as I think Loren makes clear, are nevertheless exploited by capital -- in this case via the ongoing process of a financially dominated 'primitive accumulation'.

[See, for example, Mike Davis' well documented Planet of Slums]

A Fine Summary

I appreciate this discussion because it gives a fine summary of those places where the different ("anti-state") varieties of communists agree.

Capitalism faces a cataclysmic level of crisis. There is every indication that the downward pressure on the economy is far more powerful than any of the counter-measures which capital has so far mustered. The last seventeen years of economic upswing has basically involved delusions and working class concessions packaged as reforms until the entire edifice fell apart. Now that it has fallen apart, however, not only the entire economy in shambles but capital's logic is so impaired that it can only make desperate, blind efforts.
The most obvious example of this is "value-at-risk" accounting - this has allowed (virtually arbitrary) values to be inserted onto corporate books. Now that the lies behind this circus are revealed, capital's fabric of limited trust, of "enlightened self-interest" has unraveled.

These problems are, in essence, not comparable to previous crises.

One point to consider is that one way in which capital has progressed in its ability to mobilize for its self-defense. Certainly, America has replaced its dumb and dumber with its best and brightest, for what it will be worth. Even the smartest can only fumble in incomprehension given the way that, again, capital has destroyed both its economy and its ability to understand itself (the gradual falsification of economic statistics is another important factor, for example). I thing I would imagine is a wild increase haphazard counter-crisis programs.

Still, I would hazard anything like a near-term prediction at the moment.

Best,
Red

Deindustrialization and Discussion

The US still has the largest industrial production of any nation on earth, 2.5 times that of China. US industrial production is naturally the most technologically advanced as well.

US industrial production is becoming a somewhat smaller portion of GDP and some US firms have failed to make adequate capital investment. Even more, the proportion of the US workforce engaged in production work is somewhat smaller than other industrial nations.

Now, a good portion of US industrial production follows the unbalanced character of the world economy. US has overproduced luxury housing materials and luxury housing, medical equipment and hospital beds (while providing poor healthcare to a fair portion of the population), sport utility vehicles and other things.

The Wolf Report (http://thewolfatthedoor.blogspot.com/) makes a strong case that the current crisis comes out of the declining rate of profit in US industrial sector rather than merely from speculation or de-industrialization.

While I like Loren's willingness to look at more analyses (Doug Noland's Credit Bubble Buletin), I think that he is too willing to exchange their Keynesian analysis for Marx's original analysis.

That said, I'll go back to the good things I said earlier about this article - rather than embracing Loren Uncritically, I think you do reasonable job of extracting the parts of Loren's analysis that the whole of the "anti-state" communist milieu *should* embrace (when I say "anti-state" I mean both those looking back to the early 20th century Communist Left as well as those who follow other paths to a communist analysis).

All that said, I appreciate the ICC's willingness to solicit comments on your articles here as well as in your public presentations. This not a full embrace of your positions naturally.

One suggestion for further discussion. You might have more sustained discussion if you had BBS such as Libcom's rather than just having comments at the end of each article.

Best Wishes,

Red

Further Thoughts on Loren Goldner's Article

01-26-2009
Monday

Dear Comrades:

I finally got around to reading Loren's piece.

Generally, I liked it. But I had a few issues with it.

First, my main issue is, even though the American production sector is as small as Loren suggested (and I might even suggest possibly smaller; it's my impression that Loren's figure of 15 percent is a bit bigger than the figure of the Trotskyists of the International Communist League-Fourth Internationalist, whose article in the Workers Vanguard 927 by Joe Seymour, his talk to their International Executive Committee, I read, suggested around 12 percent; but my point here is, I have no problem with the notion the production and manufacturing sector in the U.S. is quite small today), I think mechanically concentrating on that without accounting for the issue of dynamics of class struggle is problematical. Class struggle dynamics cannot be predicted ahead of time. Recently, late last year, there was a sit-in occupation at a Chicago plant that produced various windows and window-relate items. From my reading of the bourgeois articles in the bourgeois presses, I didn't get a sense of the types of workers involved. The Trotskyists of the Spartacists said it was mainly black workers, and I have no particularly reason to think there's some reason they are wrong on this. Loren in his article noted the most militant sector of auto workers in the 1970s tended to be black workers, and that's right. But my point here is, class struggle dynamics don't neatly fit into a scenario that simply looks at the smallness of the surplus value-producing sector of capitalist production in the U.S. Class struggle dynamics transcend that historically.

Additionally, as I wrote in my earlier comments before I'd read Loren's article, a sector of the indirectly surplus value-producing service workers, specifically transit workers, in the U.S. particularly in large cities like New York and Chicago, have some history of the intersection of black and labor militancy. That again brings into the social equation the issue of dynamics of the class struggle, which cannot be predicted neatly simply by looking at the smallness of the surplus value-producing sector of production workers in the U.S.

Another issue I have with Loren's article has to do with the employees and workers employed in the non-surplus value-producing sector of the economy, mainly white-collar workers. First of all, saying simply that soviets or councils are not going to incorporate such sorts of workers doesn't particularly cut it if the class struggle dynamics which might begin among more traditionally surplus value-producing sectors of industrial workers or such service workers as transit workers who indirectly contribute to the production of surplus value spread to other sectors of workers including white-collar workers. What are revolutionaries going to do -- tell such workers to not struggle and go home? I don't think so.

The point of class struggle is to broaden it to all sectors of workers no matter what sector of the capitalist economy they're involved in.

As for Loren's programmatic points, I think it's all well and good to suggest that some sectors of white-collar work or employment will be phased out in a dictatorship of the proletariat -- of, that is, workers' councils -- but to suggest it's going to happen overnight without some structure set up by a proletarian communist economy for retraining these sectors of workers in productive work doesn't make sense to me. I've performed in my life both surplus value-producing, and non-surplus value-producing work, and worked in blue-collar, pink-collar, and white-collar forms of working class work, and while I think Loren's spot on on the issue that most of the financial service sector, for instance, is redundant, these people have to be retrained in productive work. Simply calling for phasing out jobs makes no sense. After all, when these big financial institutions on Wall Street crashed recently, thousands and thousands of very ordinary workers lost their jobs, including mail room workers, typists, word processors, data entry workers, secretaries, low-level computer operators working in basic sorts of computer operations, and so forth and so on. When big banks like CitiGroup lay off -- what was it, 35 thousand or 53 thousand? -- employees, capitalism's already laying these people off. But suppose that had happened, say, in the context of a broader kind of class struggle movement among diverse sectors of workers that involved plant and factory occupations? Would Loren call, if the thing spread to white collar workers, for them to go home? Again, I don't think so. The thing is to generalize such class struggle movements to all workers, not limit it to fewer workers.

I think it's probable simply from historical traditions that the leading vanguard sectors of the working class will, in the coming class struggles, be workers like those workers who occupied that Chicago plant, not white collar workers, who traditionally are the last to struggle, not the first. I'm not foolish enough to leave out of my social equation historical traditions. So on this, I think Loren's essentially right.

But if the thing takes off and spreads, which it very well may in the not-too-distant future, revolutionary communists have to have some kind of way of addressing the class struggle if it spreads into non-traditional and non-surplus value-producing sectors of working people.

By and large, however, I thought Loren's article pretty good. I think his pointing to Marx's point about capital becoming the barrier to its own continued production and reproduction was to the point.

One last thing. To this day, I've felt that the debate among communists over whether Rosa Luxemburg's concept of basing capitalist crisis in saturation of markets or Lenin's, Bukharin's, Grossman's, and Paul Mattick's concept of basing it in the law of value's imposed limitations, seemed like two sides of the same coin to me. I have to acknowledge I've tended to see it as a tempest in a teapot. I think Loren in his point about the law of value and the limitations it imposes sort of shows that. And if I'm not mistaken, in some of his earlier writings, he tended to view crisis as a function of market saturation.

But again, it's, to me, two sides of the same coin.

Anyway, these were some latest idle thoughts after having just completed reading Loren's article.

Comradely,
Al (Allan) Greene
Email: [email protected]