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Two days before he published this article, David Graeber spoke at the People’s Forum in DC, which was organized by DC SDSers as part of Global Justice Action. The People’s Forum ran simultaneously while the G20 met in DC to save capitalism, because capitalism isn’t in crisis – capitalism is the crisis. The activities included a brainstorming session to explore “What Comes After Capitalism?” and a celebratory “Funeral for Capitalism” where the below pictures were taken. [alex]
At the "Funeral for Capitalism" - photo by Jake Cunningham
Hope in Common
David Graeber
Originally published by InterActivist Info Exchange, November 17, 2008.
We seem to have reached an impasse. Capitalism as we know it appears to be coming apart. But as financial institutions stagger and crumble, there is no obvious alternative. Organized resistance appears scattered and incoherent; the global justice movement a shadow of its former self. There is good reason to believe that, in a generation or so, capitalism will no longer exist: for the simple reason that it’s impossible to maintain an engine of perpetual growth forever on a finite planet. Faced with the prospect, the knee-jerk reaction—even of “progressives”—is, often, fear, to cling to capitalism because they simply can’t imagine an alternative that wouldn’t be even worse.
The first question we should be asking is: How did this happen? Is it normal for human beings to be unable to imagine what a better world would even be like?
photo by Christa H
Hopelessness isn’t natural. It needs to be produced. If we really want to understand this situation, we have to begin by understanding that the last thirty years have seen the construction of a vast bureaucratic apparatus for the creation and maintenance of hopelessness, a kind of giant machine that is designed, first and foremost, to destroy any sense of possible alternative futures. At root is a veritable obsession on the part of the rulers of the world with ensuring that social movements cannot be seen to grow, to flourish, to propose alternatives; that those who challenge existing power arrangements can never, under any circumstances, be perceived to win. To do so requires creating a vast apparatus of armies, prisons, police, various forms of private security firms and police and military intelligence apparatus, propaganda engines of every conceivable variety, most of which do not attack alternatives directly so much as they create a pervasive climate of fear, jingoistic conformity, and simple despair that renders any thought of changing the world seem an idle fantasy. Maintaining this apparatus seems even more important, to exponents of the “free market,” even than maintaining any sort of viable market economy. How else can one explain, for instance, what happened in the former Soviet Union, where one would have imagined the end of the Cold War would have led to the dismantling of the army and KGB and rebuilding the factories, but in fact what happened was precisely the other way around? This is just one extreme example of what has been happening everywhere. Economically, this apparatus is pure dead weight; all the guns, surveillance cameras, and propaganda engines are extraordinarily expensive and really produce nothing, and as a result, it’s dragging the entire capitalist system down with it, and possibly, the earth itself.
photo by Christa H
The spirals of financialization and endless string of economic bubbles we’ve been experience are a direct result of this apparatus. It’s no coincidence that the United States has become both the world’s major military (”security”) power and the major promoter of bogus securities. This apparatus exists to shred and pulverize the human imagination, to destroy any possibility of envisioning alternative futures. As a result, the only thing left to imagine is more and more money, and debt spirals entirely out of control. What is debt, after all, but imaginary money whose value can only be realized in the future: future profits, the proceeds of the exploitation of workers not yet born. Read the rest of this entry »
Below is an email circulating the SDS listservs that I’m reposting (I’m not the author). Workers, mostly Latin@s, have seized their workplace from management who was trying to take away their jobs and severance pay. Hopefully this is just the beginning of increased militance and organization by the working class as economic conditions in this country deteriorate and the contradictions – of bosses and banks being bailed out while we lose our jobs – become more glaring and visible.
Here is a news article about the takeover. [alex]
Chicago factory occupied
Lee Sustar reports from Chicago on an occupation by workers who want what’s theirs from management and the Bank of America.
December 6, 2008
WORKERS OCCUPYING the Republic Windows & Doors factory slated for closure are vowing to remain in the Chicago plant until they win the $1.5 million in severance and vacation pay owed them by management.
In a tactic rarely used in the U.S. since the labor struggles of the 1930s, the
workers, members of United Electrical, Radio and Machine Workers of America (UE) Local 1110, refused to leave the plant on December 5, its last scheduled day of operation.
“We decided to do it because this is money that belongs to us,” said Maria
Roman, who’s worked at the plant for eight years. “These are our rights.”
Word of the occupation spread quickly both among labor and immigrant rights activists–the overwhelming majority of the workers are Latinos. Seven local TV news stations showed up to do interviews and live reports, and a steady stream of activists arrived to bring donations of food and money and to plan solidarity actions.
Management claims that it can’t continue operations because its main creditor, Bank of America (BoA), refuses to make any more loans to the company. After workers picketed BoA headquarters December 3, bank officials agreed to sit down with Republic management and UE to discuss the matter at a December 5 meeting arranged by U.S. Rep. Luis Gutierrez (D-Ill), said UE organizer Leah Fried.
BoA had said that it couldn’t discuss the matter with the union directly without written approval from Republic’s management. But Republic representatives failed to show up at the meeting, and plant managers prepared to close the doors for good–violating the federal WARN Act that requires 60 days notice of a plant closure.
The workers decided this couldn’t go unchallenged. “The company and Bank of America are throwing the ball to one another, and we’re in the middle,” said Vicente Rangel, a shop steward and former vice president of Local 1110.
Many workers had suspected the company was planning to go out of business–and perhaps restart operations elsewhere. Several said managers had removed both production and office equipment in recent days.
Furthermore, while inventory records indicated there were plenty of parts in the plant, workers on the production line found shortages. And the order books, while certainly down from the peak years of the housing boom, didn’t square with management’s claims of a total collapse. “Where did all those windows go?” one worker asked.
Workers were especially outraged that Bank of America, which recently received a bailout in taxpayer money, won’t provide credit to Republic. “They get $25 billion from the government, and won’t loan a few million to this company so workers can keep their jobs?” said Ricardo Caceres, who has worked at the plant for six years. Read the rest of this entry »
Richard Heinberg (author of the seminal work The Party’s Over: Oil, War and the Fate of Industrial Societies) lays out a clear program for Obama, to move the US away from its current suicidal path and towards a green economy. However, the danger may be that Obama has surrounded himself with people who are telling him to do the exact opposite of each of these recommendations. Our job, as a movement, is to move the country away from fossil fuels by blocking the construction of more death machines (coal plants, oil-guzzling cars, the military…), and by simultaneously creating irresistible alternatives. [alex]
Memo to the President-elect on Energy Realism and the Green New Deal
MuseLetter 200
December 2008 by Richard Heinberg
Executive Summary
Our continued national dependence on fossil fuels is creating a crippling vulnerability to both long-term fuel scarcity and catastrophic climate change.
The current economic crisis requires substantial national policy shifts and enormous new government injections of capital into the economy. This provides an opportunity for a project whose scope would otherwise be inconceivable: a large-scale, coordinated energy transition away from fossil fuels and toward renewable energy.
This project must happen immediately; indeed, it may already be too late. We have already left behind the era of cheap and plentiful fossil fuels, with a permanent decline of global oil production likely underway within three years. Moreover, the latest research tells us we have less than eight years to bring carbon emissions under control if we hope to avoid catastrophic climate change. Lacking this larger frame of understanding and action, a mere shift away from foreign oil dependence will fail to meet the challenge at hand.
The energy transition must not be limited to building wind turbines and solar panels. It must include the thorough redesign of our economic and societal infrastructure, which today is utterly dependent on cheap fossil fuels. It must address not only our transportation system and our electricity grid, but also our food system and our building stock.
Our 21st century nation’s dependence on 20th century fossil fuels is the greatest threat we face, far more so than the current financial crisis. A coordinated, comprehensive transition to an economy that is no longer dependent on hydrocarbon fuels and no longer emits climate-changing levels of carbon—a Post Carbon Energy Transition—will be the Obama Administration’s greatest opportunity to lead the nation on a path toward sustainable prosperity.
Overview: Need and Scope
As a new Administration prepares to take the reins of power, America’s economy is descending into a recession or, quite possibly, a depression. Read the rest of this entry »
The US government is becoming more and more a tool for huge corporations and banks to eliminate their risk despite insanely short-sighted and self-serving policies. The American public will not accept our money being handed to those who don’t deserve it, and never intend to pay us back. That is fascism.
“We, the people” need a bailout too. Today I attended a rally in Philadelphia, to stop the mayor from making budget cuts to close down 11 libraries around the city. How are you supposed to provide educational opportunities for inner-city youth if you’re closing libraries? Closing doors, eliminating opportunities for advancement – this fuels the cycle of violence and crime.
We have to demand money for human needs, not corporate greed! It’s our government, it must work for us, not just the rich. [alex]
Originally published by Forbes.
Washington’s $5 Trillion Tab
Elizabeth Moyer, 11.12.08
Fighting the financial crisis has put the U.S. on the hook for some $5 trillion a report says. So far.
For all the fury over Treasury Secretary Henry Paulson’s $700 billion emergency economic relief fund, it seems downright puny when compared to the running total of the government’s response to the credit crisis.
According to CreditSights, a research firm in New York and London, the U.S. government has put itself on the hook for some $5 trillion, so far, in an attempt to arrest a collapse of the financial system.
The estimate includes many of the various solutions cooked up by Paulson and his counterparts Ben Bernanke at the Federal Reserve and Sheila Bair at the Federal Deposit Insurance Corp., as the credit crisis continues to plague banks and the broader markets. Read the rest of this entry »
I recently posted Dmitry Orlov’s great essay ‘Closing the Collapse Gap‘, and here is his latest piece, which he delivered to the 5th Conference on Peak Oil and Community Solutions. I am only reposting excerpts, because the original is very long and somewhat repetitive. I also must warn that although I find Orlov’s insight useful, I have a much more positive view of the collapse of US Imperialism, mainly because I think he is overlooking the benefits of this process for the planet’s ecosystem as well as the possibility of freedom for the majority of the world’s people who are currently suffering under US dominance. Iraqis certainly will have a different view of the collapse of the US Empire than those in the Pentagon.
How about for Americans? Is the collapse of the US better for people who live here? Orlov’s conclusion actually indicates that it may be, especially in terms of rebuilding the social fabric that has been worn away by individualism and consumerism. But he also overlooks the reality of social oppression in the US. Not everyone lives the same “middle class” lifestyle he seems to be taking for granted. There are already millions of Americans on the brink of poverty, or deep in poverty, who don’t worry about losing their SUVs.
The best outcome is for not just a collapse, but a transformation, so that nobody has to go hungry or work their life away just so that the wealthy can take cruises or visit the spa. The current Bailouts are the most striking example of the government having the exactly opposite priorities. Instead of bailing out homeowners, or the poor who lack access to public transportation, they are dumping money into the hands of the real estate and automaking profiteers! We must continue to oppose this nonsense, from Obama or anyone, and make sure that our money is used for the benefit of the majority, not the wealthy few. In a world of shrinking wealth, there should be no rich, and there doesn’t have to be any poor either. [alex]
The Five Stages of Collapse
by Dmitry Orlov
Originally published by Energy Bulletin, Nov. 11, 2008.
1.
Hello, everyone! […] My specialty is in thinking about and, unfortunately, predicting collapse. My method is based on comparison: I watched the Soviet Union collapse, and, since I am also familiar with the details of the situation in the United States, I can make comparisons between these two failed superpowers.
I was born and grew up in Russia, and I traveled back to Russia repeatedly between the late 80s and mid-90s. This allowed me to gain a solid understanding of the dynamics of the collapse process as it unfolded there. By the mid-90s it was quite clear to me that the US was headed in the same general direction. But I couldn’t yet tell how long the process would take, so I sat back and watched.
I am an engineer, and so I naturally tended to look for physical explanations for this process, as opposed to economic, political, or cultural ones. It turns out that one could come up with a very good explanation for the Soviet collapse by following energy flows. What happened in the late 80s is that Russian oil production hit an all-time peak. This coincided with new oil provinces coming on stream in the West – the North Sea in the UK and Norway, and Prudhoe Bay in Alaska – and this suddenly made oil very cheap on the world markets. Soviet revenues plummeted, but their appetite for imported goods remained unchanged, and so they sank deeper and deeper into debt. What doomed them in the end was not even so much the level of debt, but their inability to take on further debt even faster. Once international lenders balked at making further loans, it was game over.
What is happening to the United States now is broadly similar, with certain polarities reversed. The US is an oil importer, burning up 25% of the world’s production, and importing over two-thirds of that. Back in mid-90s, when I first started trying to guess the timing of the US collapse, the arrival of the global peak in oil production was scheduled for around the turn of the century. It turned out that the estimate was off by almost a decade, but that is actually fairly accurate as far as such big predictions go. So here it is the high price of oil that is putting the brakes on further debt expansion. As higher oil prices trigger a recession, the economy starts shrinking, and a shrinking economy cannot sustain an ever-expanding level of debt. At some point the ability to finance oil imports will be lost, and that will be the tipping point, after which nothing will ever be the same.
This is not to say that I am a believer in some sort of energy determinism. If the US were to cut its energy consumption by an order of magnitude, it would still be consuming a staggeringly huge amount, but an energy crisis would be averted. But then this country, as we are used to thinking of it, would no longer exist. Oil is what powers this economy. In turn, it is this oil-based economy that makes it possible to maintain and expand an extravagant level of debt. So, a drastic cut in oil consumption would cause a financial collapse (as opposed to the other way around). A few more stages of collapse would follow, which we will discuss next.[…]
I don’t mean to imply that every part of the country will suddenly undergo a spontaneous existence failure, reverting to an uninhabited wilderness. I agree with John-Michael Greer that the myth of the Apocalypse is not the least bit helpful in coming to terms with the situation. The Soviet experience is very helpful here, because it shows us not only that life goes on, but exactly how it goes on. But I am quite certain that no amount of cultural transformation will help us save various key aspects of this culture: car society, suburban living, big box stores, corporate-run government, global empire, or runaway finance. Read the rest of this entry »
On President-elect Barack Obama’s first trip to the White House yesterday to meet privately with his predecessor, lame duck George W. Bush, reportedly the first and most pressing message Obama delivered to the man in charge was “bail out General Motors.”
Cartoon by The Rag Blog
The American taxpayers are sick and tired of their money being doled out to corporate crooks like the carbon-polluting, oil-guzzling auto industry, or banks like AIG who apparently weren’t satisfied by the first two bailouts and now want another. (They apparently spent too much of their last check on trips to the spa.)
Is this really Obama’s highest priority? Giving public money to private companies that will use it to pollute the planet?
If YOU had the opportunity to sit down with President Bush for an hour and have him actually listen to you, what would YOU ask him to do?
Why not instead bail out homeowners by ending foreclosures to keep people in their houses?
Why not bail out the poor, sick, and elderly, by instituting single-payer universal health care like every other industrialized nation does?
Why not bail out Iraqis, military families and soldiers by pulling U.S. forces out of Iraq and ending a bloody occupation? (or Afghanistan, or the 100+ countries where the US military is stationed)
Why not bail out human rights by ending torture, closing Guantanamo and allowing all prisoners a trial by jury?
Why not bail out civil rights by ending anti-immigrant raids and the criminalizing of immigration?
Why not bail out students, who are suffering from the greatest debt crisis in history as education becomes increasingly unaffordable?
Why not bail out the planet, by investing heavily in renewable energies controlled by local communities, urban gardens, home weatherization and create 5 million new Green Jobs?
Barack, if you’re going to be a president worthy of the immense praise and expectation placed on you, you’re going to need to stop palling around with terroristic industry and corporate lobbyists, and listen to the people.
[alex]
Sources: Obama pressed Bush for auto industry bailout
Originally published by CNN, November 11, 2008
Jessica Yellin, Candy Crowley, CNN’s Ed Henry
(CNN) – At their private Oval Office meeting on Monday, President-elect Barack Obama urged President Bush to support billions of dollars in aid for the struggling auto industry during the upcoming lame-duck session of Congress, according to three officials briefed on the meeting.
The officials said Bush privately expressed skepticism about taxpayer money for automakers on the heels of a string of government bailouts for other industries, and the president also urged Obama to help push through a free trade pact with Colombia Read the rest of this entry »
This is a new article written by my friend and mentor, Jerry Silberman. I helped him edit it, so if anyone wants to discuss these issues, i’m available! [alex]
The Last Recession? Or Our Best Opportunity for Hope?
by Jerry Silberman
Originally published by Energy Bulletin, November 7, 2008.
As the drama of the bursting bubble of Wall St. gives way to a slower, but steady and painful, economic decline, the first and most important question we should ask is “Should we try to blow another bubble, or should we reject bubble culture values for something entirely different?”
If we agree that we need a new culture, this leads to the question “Can we take advantage of the opportunity afforded by this collapse, by the exposure of a failed system, to establish new “rules for the house” (the root meaning of “economy” from the Greek)?”
If the house, metaphorically, is Planet Earth the way we have enjoyed it for millennia, then making the choice now to change to a sustainable economy is the best way to turn the apparent lemon of this economic contraction into the best lemonade in history. Read the rest of this entry »
[There are many articles (including one I wrote in college), and even whole books written about Petrodollars – the way that US dollars dominate the world economy by their crucial involvement in all global oil trades. This just happens to be a very clearly written and accessible essay, so I’m reprinting it despite slightly out-of-date numbers. The extent to which the fragility of petrodollar hegemony affects US foreign policy is probably the biggest question mark, but it seems plausible that the much-threatened aggression against Iran has a lot to do with that country’s moves to abandon the dollar for their oil trades. – alex]
Oil prices and the dollar
C. P. Chandrasekhar
Jayati Ghosh
Originally published by Business Line, February 26, 2008.
| The depreciation of the US dollar has been closely bound up with the movement of oil prices, as world oil trade is typically denominated in dollars. Yet this relationship may now be under threat as the dollar continues to depreciate and the US economy tips into recession. In this edition of Macroscan, C. P. Chandrasekhar and Jayati Ghosh examine how oil prices have changed with different numeraires, and consider the implications for the future of the oil-dol lar nexus. |
The relationship between oil and the US dollar has been at the heart of the way international economic relations have been organised for more than half a century.
International capitalism has relied on the US dollar as the basic reserve currency, and has therefore granted it an essential degree of stability for several decades despite the large external deficits run by the US and the periodic swings in its valuation in currency markets.
More than half of aggregate world exports are denominated in dollars; more than 80 per cent of all international currency transactions similarly involve dollars.
Loans made by the IMF and other multilateral institutions are denominated in dollars. More than 60 per cent of the foreign exchange reserves held by central banks of all countries are in dollar assets.
This has obviously meant huge advantages for the US. It has allowed the US economy to benefit from access to imports that can effectively be paid for simply by printing dollars, and has therefore allowed the US to run enormous current account deficits for prolonged periods. It has encouraged the rest of the world to finance these deficits by providing its savings to be held in US or dollar-denominated financial assets, to the point that all the developing regions of the world are also building dollar reserves that directly or indirectly find their way to the US economy.
Dollarisation of oil markets
A key feature of this entire process has been the dollarisation of world oil markets. Oil is the central commodity of industrial capitalism, absolutely essential for the production of essential and widely used goods. All industrial economies, and most developing ones, would grind to a halt with even a moderate disruption of oil supplies.
Most of the world oil trade has operated and continues to operate in dollars, even when the US is not the trade partner. Oil prices are defined in dollars for most oil exporters. As a result, oil importing countries also pay in dollars. The oil-exporting countries accumulate dollar reserves, which have been preferentially invested back in the US because of the zero currency risk involved in this.
Indeed, this recycling of petrodollars has been very significant as a source of finance for US trade deficits in several periods, including in recent times. Other countries also hold dollars for future oil purchase.
The dramatic increase in the price of oil in the past few years could be argued to have accentuated this tendency. As Chart 1 indicates, oil prices have increased dramatically in dollar terms especially from 2003, going up by nearly 2.5 times between 2003 and 2007.
This has obviously contributed very significantly to the wealth of oil exporters, and allowed them to generate balance of payments surpluses and build foreign exchange reserves, which have then been invested dominantly in dollar assets in US markets.
However, this is also the period that the US dollar has been depreciating, especially with respect to some of the other major currencies such as the euro and the Japanese yen. As a result, the change in oil prices has been less striking in terms of these currencies than in terms of the dollar.
The currency factor
Read the rest of this entry »
The End of Capitalism 
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