Posts Tagged ‘revolution’

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Russia is back in the news again in the United States, with the ongoing investigation of Russian interference in the U.S. presidential election as well as a growing set of links between a variety of figures (including Cabinet and family members) associated with Donald Trump and the regime of Vladimir Putin.

This year is also the hundredth anniversary of the October Revolution, which sought to create the conditions for a transition to communism in the midst of a society characterized by various forms of feudalism, peasant communism, and capitalism. But we shouldn’t forget that, in addition, the Red Century has clearly left its mark on the political economy of the West, including the United States—both in the early years, when the “communist threat” undoubtedly led to reforms associated with a more equal distribution of income, and later, when the Fall of the Wall reinforced the neoliberal turn to privatization and deregulation.

Now we have a third reason to think about Russia, which happens to intersect with the first two concerns. A new study of income and wealth data by Filip Novokmet, Thomas Piketty, Gabriel Zucman reveals just how much has changed in Russia from the time of the tsarist oligarchy through the Soviet Union to rise of the new oligarchy during and after the “shock therapy” that served to create a new form of private capitalism under Putin.

As is clear from the chart, income inequality was extremely high in Tsarist Russia, then dropped to very low levels during the Soviet period, and finally rose back to very high levels after the fall of the Soviet Union. Thus, for example, the top 1-percent income share was somewhat close to 20 percent in 1905, dropped to as little as 4-5 percent during the Soviet period, and rose spectacularly to 20-25 percent in recent decades.

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The data sets used by Novokmet et al. reveal a level of inequality under the new oligarchs that is much higher than was apparent using survey data—a top 1-percent income share that is more than double for 2007-08.

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Novokmet et al. also show that the income shares of the top 10 percent and the bottom 50 percent moved in exactly opposite directions after the privatization of Russian state capitalism in the early 1990s. While the top 10-percent income share rose from less than 25 percent in 1990-1991 to more than 45 percent in 1996, the share of the bottom 50 percent collapsed, dropping from about 30 percent of total income in 1990-1991 to less than 10 percent in 1996, before gradually returning to 15 percent by 1998 and about 18 percent by 2015.

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In comparison to other countries, Russia was much more equal during the Soviet period and, by 2015, had approached a level of inequality higher than that of France and comparable only to that of the United States.

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Finally, Novokmet et al. have been able to estimate the enormous growth of private wealth under the new oligarchy, especially the wealth that was captured by a tiny group at the very top and is now owned by Russia’s billionaires. As the authors explain,

The number of Russian billionaires—as registered in international rankings such as the Forbes list—is extremely high by international standards. According to Forbes, total billionaire wealth was very small in Russia in the 1990s, increased enormously in the early 2000s, and stabilized around 25-40% of national income between 2005 and 2015 (with large variations due to the international crisis and the sharp fall of the Russian stock market after 2008). This is much larger than the corresponding numbers in Western countries: Total billionaire wealth represents between 5% and 15% of national income in the United States, Germany and France in 2005-2015 according to Forbes, despite the fact that average income and average wealth are much higher than in Russia. This clearly suggests that wealth concentration at the very top is significantly higher in Russia than in other countries.

Clearly, there is nothing “natural” about the distribution of income and the ownership of wealth. This new study demonstrates that different economic structures and political events create fundamentally different levels of inequality in both income and wealth, both within and between countries.

The Russian experience is a perfect example how inequality can fall and then, later, be reversed with radical economic and political transformations—thus creating a new oligarchy that dominates the national political economy and seeks to intervene in other countries.

Not unlike the United States.

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Apparently, “late capitalism” is the term that is being widely used to capture and make sense of the irrational and increasingly grotesque features of contemporary economy and society. There’s even a recent novel, A Young Man’s Guide to Late Capitalism, by Peter Mountford.

A reader [ht: ra] wrote in wanting to know what I thought about the label, which is admirably surveyed and discussed in a recent Atlantic article by Anne Lowrey.

I’ll admit, I’m suspicious of “late capitalism” (like other such catchall phrases), for two main reasons. First, it presumes and invokes a stage theory of development, which relies on identifying certain “laws of motion” of capitalist history. That’s certainly the way Ernest Mandel understood and developed the term—as the latest in a series of necessary stages of capitalist development. For me, the history of capitalism is too contingent and unpredictable to obey such law-like regularity. Second, “late capitalism” is meant to characterize all of a certain stage of economy and society, thereby invoking a notion of totality. Like other such phrases—I’m thinking, in particular, of “globalization,” “empire,” and “neoliberalism”—the idea is that the entire world, or at least what are considered to be its essential elements, can be captured by the term. As I see it, capitalism exists only in some parts of the world, some but certainly not all economic and social spaces, and, even when and where it does exist, it assumes distinct forms and operates in different modalities. Using a term like “late capitalism” tends to iron out all those differences.

So, I’m wary of the notion of “late capitalism,” which for both reasons may lead us astray in terms of making sense of and responding to what is going on in the world today.

At the same time, I remain sympathetic to the idea that “late capitalism” effectively captures at least some dimensions of contemporary economic and social reality. Here in the United States, there’s clearly something late—both exhausted and exhausting—about contemporary capitalism. In the wake of the worst crises since the first Great Depression, growth rates remains low, leaving millions of workers either unemployed or underemployed. Wages continue to stagnate, even as corporate profits and the stock market soar. And the unequal distribution of income and wealth, having become increasingly obscene in recent decades, has ushered in a new Gilded Age.

As Lowrey explains,

“Late capitalism” became a catchall for incidents that capture the tragicomic inanity and inequity of contemporary capitalism. Nordstrom selling jeans with fake mud on them for $425. Prisoners’ phone calls costing $14 a minute. Starbucks forcing baristas to write “Come Together” on cups due to the fiscal-cliff showdown.

And, of course, the election of Donald Trump.

What is less clear is if “late capitalism” carries with it a hint of revolution, whether it contains something akin to the idea that the contradictions of capitalism create the possibility of a radical alternative. Even if contemporary capitalism is exhausted and we, witnessing and being subjected to its absurdities and indignities, are being exhausted by it—that doesn’t mean “late capitalism” will generate the political forces required for its being replaced by a radically different way of organizing economic and social life.

But perhaps that’s asking too much of the concept. If it merely serves to galvanize new ways of thinking, to recommit us to the task of a “ruthless criticism of everything existing,” then we’ll be moving in the right direction.

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A few days ago, I made the argument that—however haltingly—we might just be finally emerging from the shadows of the Cold War.

And then I read Andrew O’Hehir’s [ht: sm] latest, in which he confirms exactly that:

Bernie Sanders is not going to be president. But in defeat he has accomplished something extraordinary, probably something more important than anything he could have achieved in four or eight frustrating years in the White House. For the first time since the end of the Cold War — and perhaps since the beginning of the Cold War — large numbers of Americans have begun to ask questions about capitalism. Questions about whether it works, and how, and for whose benefit. Questions about whether capitalism is really the indispensable companion of democracy, as we have confidently been told for the last century or so, and about how those two things interact in the real world.

Large numbers of Americans, especially large numbers of young Americans, are questioning capitalism in ways that were literally unimaginable for all but a tiny minority of people during the Red Scare. No, Sanders did not invent that questioning but, certainly, the unexpected success of his campaign reveals the deep cracks and fissures in capitalism’s legitimacy right now.

The rest of O’Hehir’s analysis is well worth reading. But, perhaps even more remarkable as a sign of these times, is his attempt (in this and in a previous piece) to draw an analogy from Lenin and the October Revolution—perhaps the ultimate Cold War taboo.

As O’Hehir explains,

Sanders perceived the decrepit Democratic Party roughly the way Lenin saw the crumbling Russian state, as an apparently powerful institution that in reality was ripe for revolutionary takeover.

Lenin and the Bolsheviks remain intriguing today, not to mention frightening, because of their abundant contradictions: How did a brilliant analysis of global capitalism in crisis, which seems almost eerily trenchant a century later, lead to such a dismal outcome? If capitalism is no longer to be viewed as the unalterable end-stage of history, and socialism is no longer an untouchable concept, maybe we can also get past the superstitious notion that every idea and insight that fed into the Russian Revolution inevitably produced the nightmarish Soviet state that followed. I feel quite sure that Bernie Sanders does not envision the overthrow of all political institutions or the seizure of all private property. His real relationship to the Bolshevik founder is a rhetorical and analytical one, and I find it implausible that Sanders is unaware of this. . .

Bernie Sanders served as accidental midwife at the birth of something thoroughly unexpected, the first faint glimmers of what the Marxists would have called a revolutionary consciousness. Where that will lead is anyone’s guess, but don’t be too sure that it leads nowhere and that the normative political order will soon be restored. Defenders of the system have mounted a forceful counterattack, but their confidence is too high and their vision of the future too limited. The threat of “political revolution” can no doubt be dispelled, for now. But the conditions that produced it — the intertwined failures of capitalism and democracy, as described by two socialist leaders a century apart — present problems that President Hillary Clinton cannot hope to solve.

For the old Cold Warriors who remain out there, that must really burn.

 

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