Posts Tagged ‘Europe’

RedMenace

Branko Milanovic has put forward an idea he thinks “will gradually become more popular”:

The idea is simple: the presence of the ideology of socialism (abolition of private property) and its embodiment in the Soviet Union and other Communist states made capitalists careful: they knew that if they tried to push workers too hard, the workers might retaliate and capitalists might end up by losing all.

The idea reminds me of an argument Etienne Balibar made many years ago (unfortunately, I can no long remember or find the original source but here’s a link [pdf] to one version of it)—that the “European project” was more progressive during the Cold War in the sense that the welfare state was constructed, by forces from above and below, as a response to the Soviet model of socialism, in order to prevent the working classes from adopting a communist ideology. (Since then, as Balibar has recently argued, the European project has fundamentally changed, as it has been assimilated by globalized finance capitalism and, under German hegemony, a strategy of industrial competitiveness based on low wages.)

Milanovice discusses some recent empirical work on three channels through which socialism “disciplined” income inequality under capitalism: (a) ideology/politics (e.g., the electoral importance of Communist and some socialist parties), (b) trade unions (some of which were affiliated with Communist or Labor parties), and (c) the “policing” device of the Soviet military power. He then offers his own analysis:

Communism, was a global movement. It does not require much reading of the literature from the 1920s to realize how scared capitalists and those who defended the free market were of socialism. After all, that’s why capitalist countries militarily intervened in the Russian Civil War, and then imposed the trade embargo and the cordon sanitaire on the USSR.  Not a sort of policies you would do if you were not ideologically afraid (because militarily the Soviet Union was then very weak). The threat intensified again after the World War II when the Communist influence through all three channels was at its peak. And then it steadily declined so much that by mid-1970s, it was definitely small. The Communist parties reached their maximum influence in the early 1970s but Eurocomunism had already expunged from its program any ideas of nationalization of property. It was rapidly transforming itself into social democracy. The trade unions declined. And both the demonstration effect and the fear of the Soviet Union receded. So capitalism could go back to what it would be doing anyway, that is to the levels of inequality it achieved at the end of the 19th century. “El periodo especial” of capitalism was over.

He admits the implication of such a story may be rather unpleasant:

left to itself, without any countervailing powers, capitalism will keep on generating high inequality and so the US may soon look like South Africa.

This is not to suggest we need another Cold War for United States to move even closer to looking like South Africa. But it does mean there will be a significant move from above toward more democracy and less inequality only if there’s a real threat to move outside of capitalism from below.

US-austerity

We often associate austerity with the economic policies imposed in Europe, especially Greece, since the crash of 2007-08.

However, as the chart above demonstrates (from the Wall Street Journal), the United States has pursued its own version of austerity in the years since the Great Recession began in late 2007. Total state, local and federal government spending, adjusted for inflation, shrank 3.3 percent since the beginning of the recession, compared with an average increase of 23.5 percent over comparable periods in past postwar expansions.

And, of course, the effects of such austerity have been unevenly distributed across the population, with large corporations and wealthy individuals gaining and everyone else finding themselves on the losing end.

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Blu, Thessaloniki (24 October 2011)

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The current situation in Greece appears hopeless. After two European bailouts and five years of Draconian austerity measures, which have left much of Greece in tatters, the Syriza-led government has been forced to accept a third bailout and the imposition of new austerity measures, which will only continue the current depression and leave the country with no real prospects of repaying the accumulation of new debts.

If that’s not a hopeless situation, I don’t know what is.

But Slavoj Žižek [ht: db] invokes Giorgio Agamben to the effect that “thought is the courage of hopelessness.”

The true courage is not to imagine an alternative, but to accept the consequences of the fact that there is no clearly discernible alternative: the dream of an alternative is a sign of theoretical cowardice; it functions as a fetish that prevents us thinking through to the end the deadlock of our predicament. In short, the true courage is to admit that the light at the end of the tunnel is most likely the headlights of another train approaching us from the opposite direction. There is no better example of the need for such courage than Greece today.

I think Žižek is right, although Marx may have put it even better: “You will hardly suggest that my opinion of the present is too exalted and if I do not despair about it, this is only because its desperate position fills me with hope.”

Marx (in a May 1843 letter) was responding to Arnold Ruge, who had expressed a resigned certainty that there could be no popular revolution in Germany. Marx then proceeds to demonstrate how we need to “start all over again”—by studying the philistine “lords of the world” (“lords of the world only in the sense that they fill it with their presence, as worms fill a corpse”), who wallow in “their passive and thoughtless existence.” Marx concludes with the hope that the “enemies of philistinism, i.e., all thinking and suffering people” will eventually arrive at a critical understanding of the old order, which will serve to create a fundamental rupture within existing society and usher in a new one.

The same task has to be taken up today in Greece and, even more so, Europe. Each day we learn more (e.g., thanks to Neil Irwin and others) about how Germany prevailed in the negotiations over Greece in the most recent bailout—and how the rest of Europe (from Lisbon to Latvia) accepted and reinforced the terms of the deal.

The temerity of the Greek government was to challenge the idea that “business as usual”—strict adherence to the existing rules and procedures, from bankers’ dress codes and polite public pronouncements to suggestions (by, among others, Slovenian Finance Minister Dusan Mramor and Wolfgang Schäuble) that the only way the mounting debt could be written down was for Greece to “temporarily” leave the euro zone—would solve the existing problems in Greece and the other austerity-ravaged countries in Europe.

In the end, of course, the Greeks lost. Thus, they have been forced to cobble together parliamentary votes that roll back some of the anti-austerity measures adopted by Syriza since assuming power in January, in addition to levying higher taxes and renewing the program to privatize state assets—just to fend off a liquidity crisis in the banking sector and then to enter into a new round of negotiations over the exact terms of the bailout.

The current situation does, indeed, appear hopeless.

However, in challenging the terms of the bailout—first, in supporting the “no” vote in the 5 July referendum and, then, in Prime Minister Alexis Tsipras’s statements that his government would not implement reform measures beyond those agreed with lenders at the euro zone summit this month—the Greek government has come to represent all the “thinking and suffering people” of Europe and to expose the “passive and thoughtless existence” that characterizes the “lords of the world” who currently reign on that continent.

It is one moment in a long process that is showing the world how the current system cannot solve the problems it has created.

That, perhaps, should fill us with hope.

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