Bailout

Does the crisis portend communism?

By Felix Salmon

There have been many critiques of the financial system in the wake of the global crisis, blaming its structure for the severity of the problem. But it’s taken until now for an old-school Marxist to come along and co-opt all of those critiques as a call to embrace communism. David Harvey’s new book is just that. Here’s the official blurb:

Using his unrivalled knowledge of the subject, Harvey lays bare the follies of the international financial system, looking closely at the nature of capitalism, how it works and why sometimes it doesn’t. He examines the vast flows of money that surge round the world in daily volumes well in excess of the sum of all its economies. He looks at the cycles of boom and bust in the world’s housing and stock markets and shows that periodic episodes of meltdown are not only inevitable in the capitalist system but essential to its survival. The essence of capitalism is its amorality and lawlessness and to talk of a regulated, ethical capitalism is to make an error of reasoning of the most fundamental kind.

Harvey is happy to go so far as to title his final chapter “What is to be Done?” — which of course is also Lenin’s most famous work. He dismisses attempts at wealth redistribution or increased financial regulation as mere “socialism”, and pushes instead for something much stronger, which “seeks to displace capitalism” entirely. “An ethical, non-exploitative and socially just capitalism that redounds to the benefit of all is impossible,” he writes, in a passage which will surely dismay the likes of Matthew Bishop. “It contradicts the very nature of what capital is about.”

He concludes:

Communists are all those who work incessantly to produce a different future to that which capitalism portends… While traditional institutionalised communism is as good as dead and buried, there are by this definition millions of de facto communists active among us, willing to act upon their understandings, ready to creatively pursue anti-capitalist imperatives…

The struggle for survival with justice not only continues; it begins anew. As indignation and moral outrage build around the economy of dispossession that so redounds to the benefit of a seemingly all-powerful capitalist class, so disparate political movements necessarily begin to merge, transcending barriers of space and time…

Capitalism will never fall on its own. It will have to be pushed… Political mobilisations sufficient to such a task have occurred in the past. They can and will surely come again. We are, I think, past due.

All of this reminds me, in a weird kind of meta way, of Richard Florida’s new book, which I’m reading right now. Florida, of course, is no communist, and he’s certainly not a revolutionary who sneers at the uselessness of Velcro, like Harvey does. But he did enter the crisis with lots of Big Ideas, and he’s now written a book about how the crisis only confirms that those ideas were exactly right.

James Kwak has written, apropos Richard Posner, that it’s hard to get enormous credibility out of being wrong for decades. At the same time, however, it’s always nice to see people’s views change when the facts change — and rarely have facts changed as much as they did over the course of this crisis. I suppose that the crisis has naturally pushed most people’s views to the left, and it’s hard to get much further left than Harvey. But then again, I think that there’s definitely a causal connection between the financial crisis and the rise of the tea party: in extreme times, people often gravitate towards corner solutions.

In any event, it’s probably good that Harvey’s book has now been written, if only to fill out the spectrum of reactions to the crisis and to help make leftists like Joe Stiglitz and Dean Baker look positively Reaganite in comparison. And to remind us all that Keith Olbermann and Michael Moore are maybe not quite as far to the left as some soi-disant centrists would have you believe.

Full post as published by Macroprudential on April 08, 2010 (boomark / email).