By Marku52
Streeck’s book “How will Capitalism End” is a collection of essays he wrote for the New Left Review almost a decade ago. It seems very prescient today. Much of his points are shared in the introduction, and first few chapters, and some of the points get repeated. Later chapters involve German politics, and are less useful to us. I find his idea that without corrective dialectics, capitalism will die of its own excesses, persuasive and I will go into more details in this review.
“The fact that capitalism has, until now, managed to outlive all predictions of its impending death, need not mean that it will forever be able to do so; there is no inductive proof here, and we cannot rule out the possibility that, next time, whatever cavalry capitalism may require for its rescue may fail to show up.”
For a while now, I’ve come to believe that capitalism must end. How can a system continue with such internal faults as:
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There being no present economic value in staving off an apocalyptic disaster if it is far in the future.
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Debt grows faster than income, which means eventually one entity owns everything. In the biblical past, debt “jubilees” reset the debt clock. But to Calvinistic capitalism, that is immoral. So capitalism has financial crises, revolutions, and periodic busts instead
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Rewarding the search for “externalities”, which means profiting by moving a cost somewhere else-usually the ecosystem or society. An example of this would be the mine-tailings from a mine long closed, profits taken, destroying a fishery. But it also applies to party house AirBnBs that raise the rents for locals and disquiet a neighborhood. Or those Bird scooters that end up piled up all over the sidewalks.
Streeck posits that capitalism and democracy have an oil and water relationship, in that democracy favors a “moral justice” approach (“Everyone should have housing and health care”) and capitalism responds with “economic justice” (“You can have all of that you can afford”). Now that capitalism-and in particular extreme neoliberalism has vanquished all opposition. you would think that capitalism is secure. Instead Streeck proposes that this makes neoliberal capitalism’s status even more precarious.
Streeck’s hypothesis is straightforward. Capitalism requires a dialectic opposing force to save it from its own self destruction. In the past such forces existed -unions, functioning democracy, and public outcry. Now that all these forces are vanquished, it would seem that neoliberal capitalism is here to stay.
“The social world of the post-capitalist interregnum, in the wake of neoliberal capitalism having cleared away states, governments, borders, trade unions and other moderating forces, can at any time be hit by disaster; for example, bubbles imploding or violence penetrating from a collapsing periphery into the centre. With individuals deprived of collective defenses and left to their own devices, what remains of a social order hinges on the motivation of individuals to cooperate with other individuals on an ad hoc basis, driven by fear and greed and by elementary interests in individual survival.”
Streeck says that even without a competing narrative, capitalism will fall simply because its stops working.
In past times excesses of capitalism have been countered by opposing forces, leading to compromises like the New Deal. Capitalism’s destructive tendencies were reined in to some extent, and capitalism was “saved from itself”. However, Streeck points out that this was only possible in an era of high enough growth that both the owners of capital and the moral justice society could be content with their share. Once stagflation hit in the 1970s, there was not enough “pie” to go around, and capital went to war with labor.
Capital won, unquestionably. Unions crushed, regulatory agencies corrupted or co-opted, global capital strode the globe looking for arbitrage opportunities and labor took what abuse it had to.
“Socialism and trade unionism, by putting a brake on commodification, prevented capitalism from destroying its non-capitalist foundations – trust, good faith, altruism, solidarity within families and communities, and the like.”
“Capitalism without opposition is left to its own devices, which do not include self-restraint.”
Why do our “leaders” seem so incompetent and clueless?
“After a certain amount of time, it may no longer be possible to stop the rot: expectations of what politics can do may have eroded too far, and the civic skills and organizational structures needed to develop effective public demand may have atrophied beyond redemption, while the political personnel themselves may have adapted entirely to specializing in the management of appearances rather than the representation of some version, however biased, of the public interest.”
It seems governing has become performative, rather than actual. I’d describe a democratic government as one that implements policies voters have indicated they want. However, I’d argue, once neoliberalism has infested the government, that function changes. The government serves to protect the “Sacred Market” from interference by the desires of the voters. Look at FDR’s Social Security VS Obama’s Affordable Care Act (LOL, what a misnaming!)
Social Security was a simple act of a few pages, implemented by a competent civil service. The ACA was negotiated over a year of wandering farther and farther away from “Affordable” or “Care” (advocates of Single Payer were excluded) and ended up being over 300 pages. Nobody knew what it did, or how it worked. But it created yet another Market and derailed any other reform of health care for decades while insuring the profitability of the entirely parasitic health insurance industry. Responding to the needs of the voters? No. Creating yet another market? Check.
Another damning case was when Jen Psaki, Biden’s spokeshole, was asked why, if people were finding it hard to get Rapid Covid Tests, the government didn’t just give them out. She was speechless. “The government would just Give Them Away?”
The neoliberal rot on full display. That program was one of the few effective Covid policies that Biden implemented.
Look at the government response to Covid in the western countries. Initially, public health measures were taken: quarantines, travel bans, shutdown pay, mandatory masking. This lasted a short while until the neoliberals regained control, and those efforts are unlikely to be seen again. (“Won’t someone think of the Economy!?”)
When neoliberals infest your government, their sole qualification is that they will look good in front of a camera and ensure that the government will never interfere with the operation of the Sacred Market. Hence a typical election will ask you to choose between two neoliberals with different color Culture War coats…..
Streeck posits that capitalism confronts five challenges that it cannot solve by itself.
“The capitalist system is at present stricken with at least five worsening disorders for which no cure is at hand: declining growth, oligarchy, starvation of the public sphere, corruption and international anarchy.”
Declining growth has been apparent since the first oil crisis, way back in the 70’s. Capitalism depends on growth to be able to pay back the debt that it creates. But without new fields to plunder, that growth is impossible (Heinberg calls this “Peak Everything”) Much of the alleged “growth” in the past 30 years is just counting fictitious digits in the ever more hypothecated financial economy, completely divorced from real production.
Inequality (oligarchy) is one of the basic productions of capitalism. It can’t and won’t solve this by itself, and all corrective forces, like government redistribution, have been banished.
Starvation of the public sphere is everywhere evident. Particularly in the US, where some municipalities no longer have safe drinking water. Potholes, libraries closing, public heath abandoned. There is no money to be made in the public works, so they either aren’t performed or sold off and performed poorly.
Ah, corruption……Like the entire US political electoral finance system. Or Big Pharma drug testing. But also finance itself.
“Finance is an ‘industry’ where innovation is hard to distinguish from rule-bending or rule-breaking; where the pay-offs from semi-legal and illegal activities are particularly high; where the gradient in expertise and pay between firms and regulatory authorities is extreme;”
Capitalism grows by creating markets where there never was one before. Why can’t I make a market in cocaine, human organs, or children? And since capitalism owns the government, many of these immoral “markets” do get established, or ignored where they do appear.
“Capitalism’s moral decline may have to do with its economic decline, the struggle for the last remaining profit opportunities becoming uglier by the day and turning into asset-stripping on a truly gigantic scale.”
In the US, Pirate, er, Private, Equity is now buying up veterinary offices and cosmetologists. Just proving that there is almost no interaction left that does not have Wall Street’s corrupt hand in the middle of it.
International anarchy was barely on the horizon when Streeck wrote back around 2014. International capitalism requires a hegemon to provide a stable currency for trade, to police the trade ways for safe transport, and an enforcer (like the IMF) to ensure national debts get paid. You may have noticed that this is all very much up in the air these days. The US’ poorly conceived war in Ukraine has upended all this. The US basically stole $300 billion of Russian assets, and attempted to interfere with all their trade. The world is now dividing into blocks affiliated with one side or the other, and alternative trade regimes are being put into place. The US can no longer be viewed as a safe haven for assets, when one’s asset can be confiscated at the whim of the hegemon.
“Before capitalism will go to hell, then, it will for the foreseeable future hang in limbo, dead or about to die from an overdose of itself but still very much around, as nobody will have the power to move its decaying body out of the way.”
So, to bring up Stein’s Law “If a thing can’t continue, it won’t…..”
