[Marxism] Forwarded message on South Africa conference

Louis Proyect lnp3 at panix.com
Thu Nov 12 08:01:59 MST 2009

(Submitted by Patrick Bond; bounced because of html formatting. 
Comrades need to post in plain-text.)

Short version in today's Durban newspaper, The Mercury:

Eye on Civil Society column
Where to after capitalism?

November 12, 2009 Edition 1

Immanuel Wallerstein

FIRST, how did we get to where we are today? Let's retrace our 
steps several decades backwards.

The period 1945 to 1970 saw the height of US power in the world 
system and also the moment of the most expansive economic upturn 
that the capitalist world economy had known.

Any time the world economy is expanding significantly, leading 
products that are relatively monopolised offer great profits.

The problem is that all monopolies are self-liquidating, because 
there exists a world market into which new producers enter. When 
competition increases, prices and profits go down.

A necessary precondition for capitalist profit is world order. 
Wars offer the possibilities for some entrepreneurs to do very 
well, but also occasion enormous destruction of fixed capital and 
considerable interference with trade.

But to maintain order, the world's leading political power must 
make use on occasion of its military power. And that is costly in 
money and lives.

The home citizens' initial pride in victory can turn to distress 
as they pay the increasing costs of military action, and begin to 
lose enthusiasm.

The period 1965-1970 witnessed both the end of the historically 
most expansive economic upturn, and the beginning of decline of 
the historically most powerful hegemonic power, the US.

At the same time, social protests during 1966-1970 marked a third 
downturn: the decline of the traditional movements of the world 
system, the so-called old Left.

The old Left - essentially the communists and the social 
democrats, plus the national liberation movements - had risen 
slowly across the world system, primarily throughout the last 
third of the 19th century and the first half of the 20th century.

By the 1960s, the old Left movements had achieved their historic 
goal of state power almost everywhere - at least on paper. 
Communist parties ruled one third of the world - the so-called 
socialist bloc.

Social democratic parties were in power, at least alternating 
power, in most of another third of the world - the pan-European world.

In the former colonial world, national liberation movements had 
come to power, and various versions of populist movements were 
rising in Latin America.

Today, to be sure, most analysts and militants are very critical 
of the performance of all these old Left movements, and doubt that 
their coming to power made much difference.

Old Left movements had built their strategy on the so-called 
two-step strategy - first take state power, then change the world. 
Critics charged that they had taken state power but had not at all 
changed the world.

 From the 1980s, the world right-wing movements took advantage of 
the world economic stagnation and collapse of old Left movements 
and governments to launch a counter-offensive, which we call 
neo-liberal globalisation. The prime objectives were to reverse 
all the gains of the lower strata during the earlier period.

The world Right sought to reduce all the major costs of 
production, to destroy the welfare state in all its versions, and 
to slow down the decline of US power in the world system.

The onward march of the world Right seemed to culminate in 1989. 
The ending of Soviet control over its east-central European 
satellite states, and the dismantling of the USSR itself led to a 
sudden new triumphalism of the world Right. One more illusion!

What, in fact, sustained the accumulation of capital since the 
1970s was a turn from seeking profits via productive efficiency to 
seeking profits via financial manipulations, more correctly called 
speculation. The key mechanism of speculation is encouraging 
consumption via indebtedness.

After the biggest expansion in the history of the capitalist world 
economy, there followed the biggest speculative mania. The bubbles 
moved through the whole world system - from the national debts of 
the Third World countries and the socialist bloc in the 1970s, to 
the junk bonds of large corporations in the 1980s, to the consumer 
indebtedness of the 1990s to the US government indebtedness of the 
Bush era.

The system has gone from bubble to bubble. The world is now trying 
one last bubble - the bailouts of the banks and the printing of 

The depression into which the world has fallen will continue now 
for a while and go quite deep. It will destroy the last small 
pillar of relative economic stability, the role of the US dollar 
as a reserve currency of safeguarding wealth.

As this happens, the main concern of every government in the world 
will be to avert the uprising of the unemployed workers and the 
middle strata whose savings and pensions disappear. Governments 
are turning to protectionism and printing money as their first 
line of defence, as ways of dealing with popular anger.

Such measures may assuage momentarily the pain of ordinary people. 
But they will eventually probably make the situation even worse.

We are entering a gridlock of the system, from which the world 
will find it extremely difficult to extract itself.

Some claim that the greatly improved relative economic position of 
Asian nations will allow a resurgence of capitalist enterprise, 
with a simple geographical shift of location. One more illusion!

The relative rise of Asia is a reality, but one that undermines 
further the capitalist system, by overloading the numbers of 
persons to whom surplus-value is distributed.

The underlying problem is that the three different kinds of costs 
of production - personnel, inputs and taxation - have been going 
up over time as a percentage of the actual prices for which 
products are sold.

This forces a new question - not how will the capitalist system 
mend itself, and renew its forward thrust. The new question is, 
what will replace this system? What order will be chosen out of 
this chaos?

We don't know.

So what are practical steps that we can and should take? I would 
put at the head of the list actions that can minimise the pain 
that arises from the breakdown of the existing system.

The second thing that we can do is engage in serious debate about 
the kind of world system we want, and the strategy of transition.

The third thing we can do is to construct alternative 
decommodified modes of production.

Through this all, we must put at the forefront of our 
consciousness and our action the struggle against the three 
fundamental inequalities of the world: gender, class, and 
race/ethnicity/religion. This is the hardest of all - none of us 
are guiltless and pure.

Wallerstein is research professor at Yale University, author of 40 
books, and former president of the International Sociological 
Association. He presented a longer version of this article last 
week as the UKZN Centre for Civil Society's Wolpe lecturer.

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