The stock market has been bouncing around like a yo-yo on steroids.
The term “subprime” that most of us hadn’t heard before, has become a household word.
Household mortgages have been avalanching and foreclosures piling up. Banks are locked in a credit crunch.
Bear Stearns, one of Wall Street’s biggies, had to be bailed out by the Fed.
Banks, like bookies of yore, are laying off bad bets. The government is dancing as fast as it can, printing $600 checks to send out to everybody, hopefully creating some purchasing power for people to go out and buy stuff.
Yet, despite the stimulus package, and other fables being told by George W. Bush, reputable economists and dour newsmen are predicting a deep and long recession ahead.
According to Wikipedia, the internet encyclopedia, a recession is a decline in a country’s gross domestic product for two or more successive quarters. Recessions may be associated with falling prices, called deflation, or rising prices, called inflation, in a process known as stagflation.
A severe or long recession is referred to as an economic depression. A devastating breakdown of an economy is called economic collapse.
Is that where we’re headed?
It’s got to be somebody’s fault. Who are the villains of the piece? Capitalists? No. Entrepreneurs? No. The working class? Well, maybe.
It’s the profit motive, Stupid! In the end, you know, every crook gets caught.
Where does profit come from? That is the question.
It took Karl Heinrich Marx (1818-1883) Prussian philosopher, political economist and revolutionary, to find out where profit came from. It was a discovery that ranked with Sir Isaac Newton’s discovery of universal gravitation and the three laws of motion, Charles Darwin’s theory of evolution and Sigmund Freud’s ego, super-ego and the id.
Profit, Marx found out, is the gain capitalists receive by paying workers less than the full value of their labor. It’s called “exploitation” of one class by another–an inherent feature and key element of capitalism and free markets.
What! This whole capitalist system that has taken over the world is based on out-and-out thievery! The capitalist steals the surplus value of the labor the worker puts into the commodity being produced! What a discovery!
Well, it’s better than slavery where the slave owner stole 100% of the slave’s labor power, except for what it cost to keep the slave alive. It’s also better than feudalism where the serf was allowed to keep only about 50% of his produce, while the feudal lord took the rest for allowing the serf to work on his land. It was called share-cropping in this country and continued for quite a while after slavery was abolished in 1865. So some progress has been made.
Another landmark discovery of Marx and his collaborator, Frederick Engels, was the concept of the “class struggle”. As expressed in the “Communist Manifesto”, “the history of all hitherto existing society is the history of ‘class struggles'”
Marx believed that capitalism, like previous economic systems will lead to its own destruction. Capitalism cuts from under its own feet the very foundation on which it produces and appropriates products. What it creates, in the process, is its own grave-diggers.
Just as capitalism replaced feudalism, capitalism, itself, will be replaced by another form, be it communism or some form of socialism allowing for a public and private sector in the economy.
There were few parts of the world which were not significantly touched by Marxist ideas in the course of the twentieth century.
Of course, the most prominent of these was Russia and the Bolshevik Revolution which led to the formation of the Union of Soviet Socialist Republics (the USSR). We don’t mind talking about that. You’ve got to look at these things in the long sweep of history. It took capitalism a couple of hundred years to shake itself out. Since the Industrial Revolution in England, in the late 1700s, there have been many panics, booms and busts and experimentation. Capitalism leads to monopoly and war and today we’re in the stage of empire building and globalization.
Now, new forms of socialism are taking the world stage. The Soviet Union was a failed experiment. China seemed to be using revisionist Marxism to transform itself from communism to a new form of aggressive capitalism, Cuba is continuing in the old tradition with Castro and his brother Raul barely keeping the old form of classical Marxism alive. But there is a new wind blowing over Latin America, with Hugo Chavez in Venezuela and socialist ferment in the rest of the South American continent.
The United States today is reaching a stage of critical mass. With an un-winnable war in Iraq costing an estimated 3 trillion dollars of borrowed money, an infrastructure showing signs of wear, a wobbly stock market, a bloated defense budget and a military force falling apart and Congress authorizing tax cuts for the rich, isn’t it time we considered making some changes in our economic system before changes are thrust upon us?
George W. Bush and the US capitalist oligarchy backing him up must be a part of the grave-digging team.
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