Radical political economics for today's student

snapshot of mortgage market in australia

2012-02-14T05:54:00.025+01:00

First a little context: The following needs to be understood in the context of financialisation and finance capital. Further, the 2009 World Development Report points out "[r]esidential mortgage markets are now equivalent to more than 40 percent of gross domestic product (GDP) in developed countries". This is therefore a crucial part of the economy. I would suspect there is a similar or worse in Australia (where there is much less competition).

Levels (total amounts) or stocks of home loans:
(data for Dec 2011 from APRA, quotes from The Age)

Commonwealth + its subsidiary Bankwest AU $307.5 billion (28.5% of total market)
Westpac + its subsidiary St George AU $284.6 billion (26.35%)
NAB = AU $177.4 billion (16.42%)
ANZ = AU $163 billion (15.1%)
ING AUS arm ('Dutch') = AU$ 37.2 billion (3.4% note the big jump)
Suncorp-Metway (QLD) = AU$ 29 billion (2.7%)
Bendigo-Adelaide Bank = AU$ 22.1 billion (2%)
Bank of Queensland = AU$ 21.4 billion (2%)

Degree of monopoly:

Top 8 Banks (above) sum to about AU$1042 billion = 96.5% of total AU $1,080 billion market (includes owner-occupied + investment housing loans)
"Big Four" = 86.4% of total market
For context: size of Australian economy was about AU$1,436.934 billion (GDP, current prices)
See also history of Australian banking system

Another point to consider is who own these banks? An important hint lies here.

That means the stock of mortgages is equivalent in value to 75.2% of GDP (this is not necessarily a simple statistic to interpret, mortgages are long term assets).

Home loan market dynamics - concentration and centralisation of banking capital during the crisis:

APRA data shows the stock of mortgages held by the big four grew (i.e. including new lending) by

$114 billion in 2008,
$117 billion in 2009,
$85 billion in 2010, but just
$65 billion 2011

Intense "[c]ompetition for refinancing [ed: switching existing lending from one finacier to another] came as new lending shrank to the lowest growth rates since statistics began to be kept 35 years ago." "More than 50,000 home owners refinanced a record $12.6 billion of mortgages in the December quarter, as they voted with their feet to get a better deal."

Only in "2011 for the first time since the global financial crisis, the four second-tier banks increased their home loans marginally faster than the big four. Their stock of loans grew by 8.6 per cent to $109.7 billion, against average growth of 7.5 per cent for the big four."

Mortgages in relation to profits during the financial-economic crisis:
(quote from The Age editorial piece)

"IN MOST countries, bank failures were a conspicuous part of the 2008 global financial crisis. In Australia no banks failed, though some smaller ones were gobbled up by their bigger competitors.

The big four banks were never in danger, in part because of sensible lending policies [ed. relative to the rest of world less competition, higher profit rates, therefore less impetus for riskier investment] and in part because the government guaranteed their security [ed: compare to Ireland, where the state also guarenteed private profits and socialised the risk].

Indeed, bank profits have increased since the crisis:

In the year to September 2007, the big four made after-tax profits of $16.6 billion, which was then considered a whopping return.
But in the 12 months to September last year, the big four made after-tax profits of $24 billion."

"Labour" vs "Labour Power" (or capacity to labour)

2012-01-28T05:09:00.001+01:00

Excellent explanation of why it is important to understand the difference between "labour" (which refers to either the process of creation itself or sometimes the products thereof) and "labour power" (the capacity to labour for a limited specified time-period, which is bought and sold as a commodity at a price).

Introduction to Karl Marx’s Wage Labour and Capital by Frederick Engels

http://www.marxists.org/archive/marx/works/1847/wage-labour/intro.htm

Stats on the 0.001%

2012-01-28T04:59:00.002+01:00

reprint from URPE list

This week as the world's elites met in the swiss skiing village of
Davos, Transational Institute's (TNI) Corporate Power project launched a
series of powerful infographics, to expose the Global 0.001%, the
corporations they run and the cost of corporate power.

The infographics can be seen here:
http://www.tni.org/report/state-corporate-power-2012

Some of the most compelling stats that stand out from the infographics are:

* 8 of the top 10 richest companies in the world are fossil fuel companies
* 1% of the world's companies, almost all banks, control 40% of the
shares of the world's major corporations
* 0.15% of the world's population control two-thirds of world GDP, and
with their assets could pay the costs of universal and primary
school education for 190 year.
* A tiny percentage of the global population, 0.001%, control $15.4
trillion dollars
* the extensive corporate ties of those who have pushed forward the
neoliberal project

Over the next few months, TNI will be producing a further series of
infographics looking more closely at issues of land, water, energy,
trade and investment.

What are the 'social relations of production'?

2012-01-19T08:44:00.005+01:00

Capitalism means incessant revolution in the forces of production (incl. the means of production) - and therefore also the relations of production. But what are these relations?

An Short Explanation of the Relations of Production by Marx: From the Nature and Growth of Capital (in Wage Labour and Capital)

Available in audio format here.

Capital consists of raw materials, instruments of labour, and means of subsistence of all kinds, which are employed in producing new raw materials, new instruments, and new means of subsistence. All these components of capital are created by labour, products of labour, accumulated labour. Accumulated labour that serves as a means to new production is capital.

So say the economists.

What is a Negro slave? A man of the black race. The one explanation is worthy of the other. A Negro is a Negro. Only under certain conditions does he become a slave. A cotton-spinning machine is a machine for spinning cotton. Only under certain conditions does it become capital. Torn away from these conditions, it is as little capital as gold is itself money, or sugar is the price of sugar.

In the process of production, human beings work not only upon nature, but also upon one another. They produce only by working together in a specified manner and reciprocally exchanging their activities. In order to produce, they enter into definite connections and relations to one another, and only within these social connections and relations does their influence upon nature operate – i.e., does production take place.

These social relations between the producers, and the conditions under which they exchange their activities and share in the total act of production, will naturally vary according to the character of the means of production. With the discover of a new instrument of warfare, the firearm, the whole internal organization of the army was necessarily altered, the relations within which individuals compose an army and can work as an army were transformed, and the relation of different armies to another was likewise changed.

We thus see that the social relations within which individuals produce, the social relations of production, are altered, transformed, with the change and development of the material means of production, of the forces of production. The relations of production in their totality constitute what is called the social relations, society, and, moreover, a society at a definite stage of historical development, a society with peculiar, distinctive characteristics. Ancient society, feudal society, bourgeois (or capitalist) society, are such totalities of relations of production, each of which denotes a particular stage of development in the history of mankind.

Capital also is a social relation of production. It is a bourgeois relation of production, a relation of production of bourgeois society. The means of subsistence, the instruments of labour, the raw materials, of which capital consists – have they not been produced and accumulated under given social conditions, within definite special relations? Are they not employed for new production, under given special conditions, within definite social relations? And does not just the definite social character stamp the products which serve for new production as capital?

Capital consists not only of means of subsistence, instruments of labour, and raw materials, not only as material products; it consists just as much of exchange values. All products of which it consists are commodities. Capital, consequently, is not only a sum of material products, it is a sum of commodities, of exchange values, of social magnitudes. Capital remains the same whether we put cotton in the place of wool, rice in the place of wheat, steamships in the place of railroads, provided only that the cotton, the rice, the steamships – the body of capital – have the same exchange value, the same price, as the wool, the wheat, the railroads, in which it was previously embodied. The bodily form of capital may transform itself continually, while capital does not suffer the least alteration.

But though every capital is a sum of commodities – i.e., of exchange values – it does not follow that every sum of commodities, of exchange values, is capital.

Every sum of exchange values is an exchange value. Each particular exchange value is a sum of exchange values. For example: a house worth 1,000 pounds is an exchange value of 1,000 pounds: a piece of paper worth one penny is a sum of exchange values of 100 1/100ths of a penny. Products which are exchangeable for others are commodities. The definite proportion in which they are exchangeable forms their exchange value, or, expressed in money, their price. The quantity of these products can have no effect on their character as commodities, as representing an exchange value , as having a certain price. Whether a tree be large or small, it remains a tree. Whether we exchange iron in pennyweights or in hundredweights, for other products, does this alter its character: its being a commodity, or exchange value? According to the quantity, it is a commodity of greater or of lesser value, of higher or of lower price.

How then does a sum of commodities, of exchange values, become capital?

Thereby, that as an independent social power – i.e., as the power of a part of society – it preserves itself and multiplies by exchange with direct, living labour-power.

The existence of a class which possesses nothing but the ability to work is a necessary presupposition of capital.

It is only the dominion of past, accumulated, materialized labour over immediate living labour that stamps the accumulated labour with the character of capital.

Capital does not consist in the fact that accumulated labour serves living labour as a means for new production. It consists in the fact that living labour serves accumulated labour as the means of preserving and multiplying its exchange value.

Violent Revolution?

2012-01-19T06:29:00.002+01:00

Socialists are often accused of demanding a forceful (violent) insurrection - how do marxists respond to that?

I have just pasted up photos of pages 88-93 (BOTTOM BIT HERE) of the book "Marxism in today's world" by general secretary of the England/Wales SP Peter Taaffe (available on the CWI website), which deals exactly with that issue.

The main discussion is the importance of the "transitional approach" - that is the method originally outlined by Trotsky that the CWI uses, that takes into account the consciousness of the working masses. The example used is crucial as well - the defence of any progressive measures/reforms or revolutionary steps forward, such as nationalisation of key sectors of the economy.

Naturally the organised ruling class would use violence (the state as ultimately a 'body of armed men', witness the police on occupy to start with...) to defend its ruling position in society - and at a certain point progressive reforms certainly have to encroach on that position (the basic labour-capital contradiction that is inherent in capitalism). How should we respond respond to that? read on...

Media - New Book on Social Role of NYT

2012-01-13T06:56:00.006+01:00

Reprint of a review from Union of Radical Political Econonmist's mail-list

The Gatekeeper: 60 Years of Economics According to The New York Times. Robert Chernomas and Ian Hudson, Paradigm Publishers.

The New York Times (NYT) can make a legitimate claim to be the most influential newspaper in the United States and possibly the world. Because of its influence, the Times has become a central figure in the debate over the direction of bias in the media, with some claiming that it is left wing or liberal and others arguing that it is right wing or conservative. But the liberal-conservative media debate is very misleading. The Gatekeeper argues that the Times can more accurately be characterized as supporting long run profitability for U.S. business, which involves both liberal and conservative policies in different contexts. Through a thorough examination of the Times' star commentators and its coverage of the issues of macroeconomics, regulation, foreign policy, and the 2008-2009 economic crisis, The Gatekeeper refocuses the debate about the bias of the most venerable institution in U.S. journalism.

"Robert Chernomas and Ian Hudson have written one of the most sophisticated and original works of journalism criticism in years in The Gatekeeper. No one will ever view the New York Times or American journalism the same after reading this book. In view of the deep problems facing the U.S. and the global economy our need for firstrate journalism has never been greater. Thanks to Chernomas and Hudson, we now know what to expect-and not to expect-from the New York Times, and why. This is going to be required reading for media critics, students, scholars, and concerned citizens." - Robert W. McChesney, Gutgsell Endowed Professor in the Department of Communication, University of Illinois at Urbana-Champaign, and coauthor of The Death and Life of American Journalism.

Finance Capital

2012-01-12T17:26:00.001+01:00

Above the circuit of production capital (see May blog entry here) hovers finance capital, which is crucial to get the right amount of money in the right place at the right time.

Some observations:

financial innovation absolutely crucial - and the state almost has to get involved (money supply, regulation - incl. setting up mortgages etc)
When finance operates at both ends - for example supply of houses (financing building company) and demand (financing mortgages), bubbles easily form (markets don't 'clear').
On fictitious capital see this fascinating description: http://www.marxists.org/glossary/terms/f/i.htm#fictitious-capital
[to be developed later - contradictions between finance capital and productive capital]

More coming...

how capital flows between different (financial) assets depends largely on (relative) returns and the safety of those returns

2011-12-29T05:53:00.002+01:00

See how capital has shifted away from stocks / equity to term-deposits in australia:

http://www.smh.com.au/business/markets/exodus-as-investors-see-no-equity-in-equities-20111219-1p2fw.html

Another important but not unexpected development in Australia and elsewhere is the big effects on retail eg harvey norman. profit downgrades, losses and share prices plummet as 'consumer confindence' takes a hit. The Age during the xmas period carried some good overview which ill try to link to later.

A must read for all those critically working out the crisis

2011-12-26T15:22:00.000+01:00

http://www.socialistworld.net/doc/5481

The Transitional Program (by Taaffe)

2011-11-20T10:27:00.008+01:00

Now the IST [International Socialist Tendency of which the UK's Socialist Workers Party (SWP) is the dominant national section, W.], despite its formal adherence to the goal of a ‘revolutionary party’, has followed the USFI through a blatant opportunist turn, particularly in Britain.

This seems to be in marked contrast to their policies in the 1990s. Reality, however, always imposes itself, even belatedly, on those in political denial. Towards the end of the 1990s, the IST came up against a political brick wall. The SWP was compelled to moderate its previous crude sectarian ultra-leftism – “no participation in elections”, “smash the state” etc., which Peter Hadden took up effectively in his pamphlet, ‘The Struggle for Socialism Today: A Reply to the Politics of the Socialist Workers Party’.

In the manner of pre-1914 social democracy, the SWP put forward the ‘maximum’ programme – the call for revolution and socialism, “smash the state” – together with the ‘minimum’ programme of day-to-day reforms. The ‘maximum’ and ‘minimum’ programmes are separated in the agitation and propaganda of the SWP. Trotsky, on the contrary, basing himself on the experiences of the Bolshevik Party, put forward a programme of transitional demands in the 1930s. This flowed from the economic situation pertaining then, in which capitalism could no longer afford lasting reforms. Therefore, the struggle for reforms, seriously conducted, posed the need for the socialist transformation of society.

Trotsky’s series of ‘transitional demands’ were a bridge from the existing level of consciousness of the working class at that stage to the idea of the socialist transformation of society. But the IST, beginning with Tony Cliff, rejected this idea. Cliff made his organisation’s view clear: “The basic assumption behind Trotsky’s transitional demands was that the economic crisis was so deep that the struggle for even the smallest improvement in workers’ conditions would bring conflict with the capitalist system itself. When life disproved the assumption the ground fell from beneath the programme.”20

No programme is put forward irrespective of the concrete historical conditions. Trotsky’s approach was entirely justified in the 1930s. But what Cliff did not understand was the change in the objective situation which flowed from the world upswing of capitalism in the post-1945 period, which did allow serious reforms to be conquered by the working class. Even then, contrary to Cliff’s assertion, the working class did actually implement some of the transitional demands outlined by Trotsky. For instance, for an historical period the Italian workers implemented the idea of a sliding scale of wages, through the scala mobile. The colossal development of the shop stewards’ committees in Britain, in the post WW2 period, and in other countries, was a partial realisation, in a slightly different form, of the demand in Trotsky’s programme for “factory committees”.

But the conditions sketched out by Trotsky in the 1930s are beginning to mature today. There is an organic world economic crisis of capitalism, which has compelled the ruling class to engage in a ferocious attack on living standards, as described earlier. This means that the struggle for lasting reforms inevitably poses the question of the revolutionary transformation of society. In no way does this mean that important short-term gains by the working class are not possible but they are temporary and cannot have a lasting character, given the inevitable attempts by capitalism to take them back. Witness the stubborn insistence of the French ruling class – despite the fact they have been defeated time and again over ten years of efforts – to cut the living standards of the French workers and to even take back the 35-hour week, a conquest of a previous period.

Therefore, just when the method of Trotsky is beginning to come into its own, although the type of programme and many of its demands will be different today because of the different conditions, the SWP rejects it. In the past, they accused the CWI, particularly ‘Militant’ (now the Socialist Party) in Britain, of capitulating to ‘reformism’. This was never the case; we indissolubly connected the day-to-day demands of the working class with the idea of the socialist goal, specifically mentioning the contribution of Marx, Engels, Lenin and Trotsky. Sometimes the SWP may still shout about “Revolution!” but more often then not now their day-to-day activity consists of limiting their programme to minimum slogans like “Tax the rich!” This goes hand-in-hand with an uncritical approach towards leading ‘Left’ figures.

Another example of the IST’s attitude is the pamphlet ‘Anti-Capitalism’ by leading SWP member, Chris Harman. This deals in great length with the anti-capitalist movement but does not make a single programmatical proposal and does not mention socialism once. Nowhere does Harman call for the nationalisation of the multinational corporations under democratic workers’ control and management. Nowhere does he put forward a democratically planned economy as an alternative to the market system. He deals with the anti-capitalist movement and the workers’ movement as if they were two completely separated things which cannot be brought together. The necessity of new workers’ parties with a socialist programme is not mentioned.

This is from a chapter in A Socialist World is Possible by the CWI's Taaffe (2005)

* Another good outline of the transitional method in a different context can be found in Taaffe's Marxism in Today's World on pp. 88-93 (esp. 93). See below:

Northern Rock - this is what nationalisation on a capitalist basis means

2011-11-17T13:38:00.003+01:00

profitable assets sold - Northern Rock PLC: "taxpayers end up with a loss of somewhere between £400m and £650m"
toxic assets kept in public hands - Northern Rock (Asset Management): losses still uncertain, but could amount to as much as £21bn
job losses: currently employs 2,500 people, down from 5,500 when it was nationalised.
no guarentee that existing jobs will stay - unenforcable promises of "no compulsory job cuts for three years"

http://www.bbc.co.uk/news/business-15769886

Instead of socialising the losses:

nationalise the assets,
guarentee ordinary people's deposits
morgages at afford interest rates, and write-downs to (speculation-driven) inflated house prices to reflect affordable, realistic prices (reflecting real material and labour costs).
guarentee jobs or retraining,
shareholders to be compensated only on the basis of proven need
repudiate the losses - those were made by shareholders and top management adopting a policy of speculation - not the vast majority of Northern Rock workers and ordinary taxpayers!
use the banking sector - the core of the modern economy - to invest in socially necessary projects (education, housing...), not simply on what will make the highest rate of profit without regard to the social costs.

Morgage and banking crisis in ireland: click here and here

How Can the Occupy Movement Win? By Drawing in the 99% - Working Class People and Youth

2011-10-25T22:19:00.034+02:00

By Wjard van Leeuwen,
Amsterdam, 25 October 2011

(based on speech of 21 October 2011)

DEMONSTRATION @ Beursplain every Saturda
UPCOMING BIG ANTI-CUTS DEMO (Hete Herfst) – 20 November
see this US article too: http://www.socialistworld.net/doc/5376

Notes: 1. Urgent! In all countries the state is increasingly using violence (all types of police) to intimidate protestors. We must build this movement now. 2. First draft only, will be changed. 3. Click on the hyperlinks throughout. 4. I have used the Socialist Alternative's (CWI in US) statement on Occupy.

OCCUPY BACKGROUND + REPORTS

On 17 September 2011, two thousand people rallied in Lower Manhattan and marched up Broadway. They stopped at Zuccotti Park – later renamed “Liberty Square” – and an estimated 150 stayed the night and began an encampment: “Occupy Wall Street”. They kicked off a protest against bank bailouts, corporate greed, and the unchecked power of Wall Street in Washington. The slogan they adopted – “We are the 99%” – has struck a cord with something like half of Americans (according to a Times survey [6]) supporting the occupations. Since then the Occupy movement has spread across the US (after 17 September) and the globe (especially after 15 October), with approximately 1500 – 2000 (1500 is quoted often, see link) protests and occupations in 82 countries.

The protests attracted a broad layer of people who have never protested before – a very positive development – including some of the organisers! [7] In Nederland there were large demonstrations in Den Haag and Amsterdam (I participated in both) on Saturday 15 October and smaller protests in Rotterdam, Maastricht and Utrecht (CWI intervened in first 4 cities). There reports of further actions in Groningen, Heerlen, Nijmegen, Eindhoven, Venlo, Winschoten, and more are planned.

The camp in Amsterdam has grown beyond Beursplein’s capacity and additional locations are being discussed. The original 20 to 30 tents quickly expand to 100 or more, with several communal structures and spaces. Nightly assemblies and sometimes daily assemblies, organised through a so-called ‘consensus’ model, attract hundreds of people.[5] Initially these were very well ‘facilitated’, but recently some general assemblies have lasted for longer than three or more hours! Workgroups are open to anyone to join, but how these relate to assembly seems to depend on the people in the groups themselves. Largely what needs to be done is done through self-initiative behind the scenes.

Why has the Occupy movement caught on? Below surface there is deep anger. There are attacks on health care, social services, education, wages, pensions and so on, in almost every single country. People clearly understand these attacks are connected with the bank bailouts, and this is why the anger is directed at the financial system. People are occupying to “liberate space” to build a new, more equal and just community, and hoping it will inspire others to follow. While occupations example of a community based on democracy, cooperation and solidarity, unfortunately, occupation alone is not enough to build a mass movement capable of changing society.

INTERNATIONAL INSPIRATION

Many have alluded to Egypt saying that a growing occupation with one basic demand is how the dictator was overthrown. But in fact, the situation was more complicated than that. In the week before Egypt's dictator Mubarak was ousted, the working class entered the scene with decisive strike action paralyzing key parts of the economy.

The occupations in Spain and Greece have been much bigger than Wall Street, but they too need the more powerful forces of the working class to move into action in order to win.

In Wisconsin, a huge occupation of the Capitol lasted for over 3 weeks and was at the center of mass demonstrations of the workers and youth. They could have won if that movement had moved toward a general strike of public sector workers to shut the state economy down.

Instead the Wisconsin battle was consciously derailed by the Democratic Party and the top union leadership by diverting the mass movement into a campaign to recall the Republicans from power in order to elect Democrats in their place. However, the Democrats, like the Republicans, are a party of Wall Street and Big Business, and they offer no solutions.

The example of Wisconsin highlights several lessons. We need an independent struggle which seeks to draw in the widest layers of workers and youth. United we have the power to withdraw our labor, stop “business as usual,” and hit the banks, corporations and ruling elite where it counts.

To do this we need to build up confidence to take bold measures. That’s why it is a huge step forward that Occupy Amsterdam called for mass demonstrations – now every Saturday. The next step should be to base these demonstrations around the burning issues that the "99%" - workers, the unemployed, single parents, pensioners, housewives (i.e. the working class) and youth - face: that is around unemployment and jobs, education, healthcare, pensions and so on.

DEMANDS AT OCCUPY

The Socialistisch Alternatief (SA, the CWI in Nederland) in Amsterdam has argued that Occupy adopt the following demands to draw in the broadest layers of the working class and youth:

(1) That Occupy call for the occupations and assemblies to be spread across Nederland, Europe and the world (this is largely accepted), but not just into public squares but also into schools and communities more broadly.[1] To do this we must organise a systematic mass campaign to mobilize the widest layer of workers, young people and labour unions.

(2) One obvious way to do this is to give practical and political solidarity to the diverse groups struggling against the crisis and the cuts, and to those workers who are on strike. The Occupy Amsterdam assembly decided (21/10) to support the public transport workers in Amsterdam, Den Haag and Utrecht that were due to take a one day strike sometime October, as well as the cleaners, who have been on strike for several weeks. Several union groups and leaders have reciprocated such solidarity actions. This very positive development should be expanded on the largest possible scale, and contact should be regularised.

(3) There needs to be organised, regular and regularised coordination with other struggles. Occupy should aim to develop transparent coordination mechanisms with other groups. This will mean that particular people take particular responsibilities - this is already happening in an ad hoc way. How those people are held accountable needs to be discusssed [3].

(4) The key activity in this mobilisation campaign will undoubtedly be the mass weekend demonstrations. As I said earlier, their acceptance is a big step forward. In Amsterdam they will be on Saturdays, 12:00 at Beursplein. This Saturday 22 October there was a march to Dutch Central Bank (DNB) on the eve of an important EU crisis summit. Next Saturday 29 October there will be a march against the G20 summit and a for a “Robin Hood” tax on speculative financial transactions.

However, to draw in workers and youth, Occupy clearly needs call for (in no particular order):

No cuts to social services,
A massive jobs creation program (for example “JOBS NOT CUTS”),
End the attacks on higher education
Major tax hikes on big business and the super-rich (for example “LET THE CAPITALISTS PAY FOR THEIR CRISIS”),
End the wars (for example “OUT OF IRAQ, AFGHANISTAN”),
Slash the military budget (for example, “NO to Jet Fighter Program”),
Defend union and democratic rights (for example, “REAL DEMOCRACY NOW!”)

If workers and youth see their needs reflected in the Occupy movement, they will support it practically and politically. If they are involved in other struggles, they will link our struggles together.

Such proposals mean that we have had to combat the totally false idea that ‘politics turns people off’ - we will gain many more serious people than those we will supposedly 'lose' (which includes many who are simply not interested in practical or political action). I will illustrate this by example. We should not repeat the same mistakes the Spanish and Greek solidarity protests in Amsterdam and Den Haag made, in the Occupy movement.[4]

Again the point is to organise a mass campaign to build support, and to bring unionised and ununionised workers, the unemployed, youth and students into movement. This means Occupy needs to orient itself to the working class (which includes, obviously, the unemployed, housebound mothers, retired etc) and the youth.

ALTERNATIVE TO CAPITALISM NEEDED

These practical demands are linked to need for alternative to capitalism, need for alternative political voice. Not only economy but society is in a deep crisis. Global capitalism is a failed system that cannot overcome the problems of growing inequality, poverty, mass unemployment, environmental destruction, and war which it creates.[2] This is no accident – investment and production only happen if capitalists believe it will be profitable to invest. No wonder there are wild economic and therefore social fluctuations!

If the problem is private ownership of resources of society, then the movement must challenge this – it must challenge the “the markets” and all parties of big business. It needs to stand up to capitalists’ policies that try to solve their economic crisis on our backs – in order to maintain a system which only benefits the elite in first place!

That is why the Socialistisch Alternatief also demand that the Rutte government goes, that we say “no!” to all cuts. We clearly link this with need to end the dictatorship of the big banks and big business - the only solutions to the crisis that is in the interest of ordinary people are socialistic solutions (repudiation of the debts, nationalisation of banks etc.) If we brought the big banks and biggest companies which dominate the economy into public ownership – and run them under the democratic management of elected representatives of their workers and the public – we could replace this rotten system of capitalism with democratic socialism, creating a new society that organises production and distribution on human (social) needs rather than profit.

[1] Different occupations should also link up (coordinate) – this means transparent elected accountable to each occupation

[2] Capitalism cannot be reformed in a piecemeal sense– every time there is crisis, all previous gains of working class are attacked by capitalist and capitalist’s representatives in parliament.
[3] Socialist Alternative has elsewhere called for the establishment of local Anti-cuts committees (anti-bezuinigingscomites in Dutch, "ABCs") in each city, which could bring together – perhaps in some sort of federal structure with representative of each group – all the different groups that are struggling against the attacks of capitalists and capitalist governments. Through such local ABCs can then elect a national ABC to organise and mobilise for a national demonstration. Occupy could play a role in establishing such coordination.
[4] Between May and July/August SA was involved with the Spanish and Greek solidarity protests in Amsterdam and Den Haag, which attracted a layer of Dutch and immigrant youth. These magnificent demonstrations and assemblies started out with several hundreds of participants but ended up a few months (even weeks?) later with 'assemblies' with sometimes as few as six or less people! One important reason for was because of refusal to orient to other groups in struggle – out of hostility to political organisations in general (past decades of political betrayals and the corrupt, bureaucratic monstrosities which have dominated the political scene, from left to right, were bound to leave their impact on the consciousness of young people - see article here under the sub-heading "anti-political?"). ("We are here only as individuals" was the slogan of this position.) The assemblies were further undermined by a lack of serious discussion regarding some form of counter-politics to the capitalists' politics.
[5] There are a lot of problems stemming from the so-called ‘consensus’ attempt to include everyone (I will expand more on consensus later). For example, it takes hours to reach decisions on even the most basic of tasks (media statements etc), and no ‘radical’ proposals are ever discussed, because someone (often just one or a small handful of people in group of hundreds) objects.
[6] Here is one such survey. It should be noted that Spanish indignados had approx. 70% support in Spain.
[7] In Den Haag the crowd – realising their isolation on the Malieveld could be overcome by occupying the Plein (just outside the original location of Binnenhof) where they had earlier been denied the right to protest. When the protesters rather innocently but spontaneously broke through the police line composed of largely of horses, a single organiser attempted to stop hundreds of people by stretching out his arms and shouting ‘we only have permission for Malieveld!’ After a conversation it was clear that this was not out of an attempt to isolate the protest, but rather out of a naïvely-applied sense of being responsible for people’s safety.

socialistic redistribution of wealth and income

2011-10-24T18:55:00.003+02:00

Letter:

Hi everyone,

At our meeting on Friday there was some discussion that a socialistic redistribution of wealth would imply a lower standard of living for the average person. I disagreed and said I would send some statistics that supported this claim. There are many more you can google.

http://www.stateofworkingamerica.org/charts/view/206

In this chart you can see that the top 5% own approximately 60% of the wealth in the US (and in fact that the proportion is increasing). The top 1% over 30-5% of the wealth. And this is an 'advanced capitalist economy'

Now that's wealth (i.e. wealth currently existing). In considering a redistribution, we also need to take into account wealth that is will be created in the labour process in the future (i.e. income) whose distribution pattern would also obviously change.

As I said this is no accident but a necessary result of class relations under capitalism, and the drive to increase profits, even at the cost of a redistribution of income (this started in the early 1980s in the US, Europe etc) - which means that the working class can buy only decreasing amounts of the stuff whose production in measured in money terms has actually increased. This problem actually underlies the current economic systemic (rather than a 'normal' business cycle) crisis of capitalism.

W

PS: 147 companies control 40% of wealth! http://www.socialistworld.net/doc/5378
PPS: Wealthiest man in history alive today: http://www.socialistworld.net/doc/5395

How Can the Occupy Movement Win?

2011-10-14T16:15:00.005+02:00

15 October leaflet of the Socialistisch Alternatief (CWI in NL)

Stop de dictatuur van de beurzen en vrije markt!

Over de hele wereld is er aandacht voor de bezetting van Wall Street! De protesten daar zijn een inspiratie voor duizenden mensen en hebben geleid tot nieuwe bezettingen die zich verspreiden over de VS en de wereld.

De aanval van de politie in New York, bedoeld om de beweging te intimi-deren, heeft de geest van het protest niet gebroken. Men is nu meer dan ooit vastbesloten om door te vechten. Geïnspireerd door de revolutionaire bewegingen in Egypte en het Midden Oosten en door de massale jongerenbezettingen in Spanje en Griekenland, hebben actievoerders bezit genomen van de straten van New York en steden in de VS en Europa. Een opstand tegen de heerschappij van Wall Street en de grote bedrijven over onze levens, de overheersing van 1% over 99% van de mensen!

In Nederland neemt de woede over het graaien van de bazen en de bezui-nigingen van het kabinet Rutte steeds verder toe, en terecht! Nationale regeringen over de hele wereld zien het als hun taak om de honderden en duizenden miljarden die ze aan de banken hebben uitgegeven, bij de gewone mensen terug te halen. Massale actie is nodig tegen alle bezuinigingen om te voorkomen dat wij en niet de schuldigen de rekening van de crisis voorgeschoteld krijgen! Maar nog belangrijker: hun remedies werken niet! Bezuinigen leidt tot krimp, zoals overal in Europa zichtbaar is. Kapitaal vlucht weg naar veilige havens, goud, Zwitserse franken, staatsobligaties van de VS en Duitsland. De werkende bevolking heeft deze keuze niet! Wij hebben geen andere keuze dan hard terug te vechten.

Weg met dit system!

Niet alleen de economie maar de hele samenleving is in een diepe crisis. Het wereldwijde kapitalistische systeem slaagt er niet in om de problemen van groeiende ongelijkheid, armoede massale werkloosheid, vernietiging van het milieu en oorlogen, die het systeem nu eenmaal voortbrengen, op te lossen. De “Occupy” beweging moet Wall Street en de beurzen aanvechten en alle politieke partijen die bezuinigingen doorvoeren in hun belang. We moeten ons verzetten tegen alle pogingen om de economische crisis over onze rug op te lossen om een systeem in stand te houden waar alleen de elite van profiteert. Wij hebben overal anti-bezuinigingscomités (ABC’s) nodig om het verzet te mobiliseren.

Maar we moeten ook een duidelijk alternatief bieden. Wij moeten de maatschappij fundamenteel veranderen in een samenleving die niet op winst is gebaseerd, maar op het vervullen van menselijke basisbehoeften. Het enige echte alternatief voor de winsthonger van bedrijven en het kapitalisme is democratisch socialisme waarin de gehele economie, alle bedrijven en de samenleving als geheel, democratisch bestuurd word door en voor de overgrote meerderheid van de mensen.

Sluit je aan bij Socialistisch Alternatief!

Verspreid de bezettingen over de VS en Europa en naar de scholen en de wijken. Voor een systematische, massale champagne om brede lagen van arbeiders, jongeren en vakbonden bij de strijd te betrekken.
Laten we massale weekenddemonstraties organiseren rond de eisen: Stop alle bezuinigingen! Een massaal programma voor meer vaste banen. Forse belastingverhogingen voor de superrijken en de grote bedrijven. Stop de oorlogen, geen JSF en verdedig democratische en vakbondsrechten.
Voor de oprichting van Anti-bezuinigingscomités (ABC’s).
Stop de dictatuur van de beurzen en de vrije markt. Nationaliseer de grote banken en bedrijven die de Nederlandse economie beheersen en laat ze besturen door democratisch gekozen arbeidersraden en vertegenwoordigers vanuit de gemeenschap. Compensatie alleen voor kleine investeerders op basis van bewezen behoefte en niet voor de miljonairs.
Bouw de beweging om het verrotte system van het kapitalisme te vervangen door democratisch socialisme en creëer een nieuwe samenleving gebaseerd op de behoeften van mensen.

OPENBARE VERGADERING VAN SOCIALISTISCH ALTERNATIEF:

The Occupy Movement: How can we Win?

21 OKT. (Vr.) 19:00 -
IN “HET GESPUIS” Spuistraat 47A-1 A’DAM

FACEBOOK: https://www.facebook.com/event.php?eid=247232975325004

Not only the economy but society as a whole is in a deep crisis. Global capitalism is a failed system that cannot overcome the problems of growing inequality, poverty, mass unemployment, environmental destruction, and war which it creates. The movement has to challenge big business and their parties. We must stand up to their policies where they try to solve their economic crisis on our backs in order to maintain a system which only benefits the elite in the first place.

The Committee for a Workers' International (CWI) fights for this change. We are an international group of national parties or sections based in about 40-45 different countries (the problem is global, so the solution should be too!) The Dutch Section is called Socialistisch Alternatief. [Click on the names to see websites].

We base ourselves on the working class as the only social force that has the capability to carry through a social, political and economic revolution to move beyond capitalism. Here is a CWI "about us" and website: http://www.socialistworld.net/doc/1

What is Capitalism?

2011-10-11T14:38:00.001+02:00

Introduction or leadoff, by JP and Wjard

1. Intro – specific budget cuts + recession

Most of the major social problems are because of capitalism and its policies: massive inequality, environmental destruction, poverty, massive industrial waste, war, famine, even body issues (advertising), drug abuse (through lack of jobs and social isolation) etc

2. Why the budget cuts?

(a) the banks and big business speculated, gambled on the stock market

(b) and they lost

(c) the capitalist governments bailed them out (to prevent the collapse of the banking system) i.e. gave them loads of money (without any controls whatsoever!)

(d) now we are being asked to pay for this bailout (budget cuts, wages cuts etc).

3. Why the banks speculate, gamble? Simple – to make a profit.

[In the past money was invested in real production, but recently it has become more profitable to invest in stocks and bonds, than to make real things. Of course this is speculation – and like a house of cards falls over when prices fall.]

4. Why does capitalism need profits?

Under capitalism things are produced only when they make a profit. They don’t make shoes because they are useful but because shoes make a profit. If shoes don’t make a profit then they won’t be produced.

This means economic chaos – investment happens in industries where profits are expected to be highest. This means we have lots of ups and downs (business cycles) and crises, because sometimes there is too little production (eg. Too little food) and often there is too much production (eg too many mobile phones).

So we live in a world where too much production causes a crisis!

Again: Under capitalism things are produced only when they make a profit.

So even environmentally destructive mining operations are invested in when they bring in the big bucks. Capitalists and their representatives will also make sure there are no real laws or regulations to prevent this (since this would lower profits).

5. Where does profit come from? Profit comes from the exploitation of workers – they don’t get paid for the full amount they produce (if they make 200 shoes in a day, they might only get paid the equivalent of 50 shoes).

So you need a group of people who are willing or coerced into working like this – the working class.

Workers are anyone who has to work for a living (i.e. they have sell their labour power to live.)

Capitalists are the people who invest money and live off the profits.

These two groups are always fighting for a larger part of the wealth that is created in society. Workers want more wages, capitalist want more profits. This is what is called the class struggle.

This struggle can never be resolved under capitalism – if workers take too much away from profits, then businesses won’t produce anything anymore.

If workers do demand too much of the value they produce then capitalist governments will beat them with a stick (eg Thatcher in the UK and Reagan in the US in the 1980s).

That is why you cannot ‘reform’ capitalism – every gain for the working class will be attacked in the future (either by governments representing capitalists, or by capitalist directly through mass firings, push wages down etc).

Therefore you need a revolution to fix social problems – where the working class takes control of the economy to produce what it needs (using democracy and planning to achieve economic advancement.)

6. Why did the government bail the banks out?

Governments all over the world – Holland, Germany, Greece, the US etc – are all capitalist governments. They represent the interests of the capitalist, not the interests of the working class.

Firstly to get elected you need big money – advertising etc (look at the US elections).
Second, ideological – the consensus is capitalism. The media, universities, etc all claim that capitalism is the only way. They claim there is no alternative. This is not true.
This has to do with manufacturing consensus, including crushing alternate opinions.
They elites themselves – they receive much higher incomes than average working people (and themselves often are drawn from the business world).
Other reasons?

7. How can we fight back?

Unity: Workers unions. A single worker cannot resist the boss – they will be fired. But if all the workers go on strike the capitalist cannot make a profit, and cannot fire them all, and so can be forced to hand over higher wages

However this will get more wages, but these will always be resisted, both politically and in the workplaces.

Capitalists are usually in competition with other capitalist so they are obliged to resist demands for higher wages –

Like we have said, reforms are eventually undermined.

The same reasoning applies to environmental and health regulations etc.

Again we need a political, social and economic revolution to fix war, poverty, and destruction of the environment! This is what genuine socialists fight for.

How can we Win? How to Fight all the Cuts (Public Meeting)

2011-09-19T23:57:00.000+02:00

Time	30 September · 19:00 - 22:00

Location	Gespuis (Barzaal): Spuistraat 47A-1, 1012 SR Amsterdam (map below)





More info	Governments in every country are trying to make ordinary people pay for the bank bailouts. In Nederland alone this is €18 billion! Why should we pay? We didn’t make the crisis. That was banks and big business gambling on the markets (i.e. speculating), and their representatives in parliaments who bailed them out. The ‘consensus’, pushed in the media, is that we should all ‘tighten our belts’. But we shouldn’t pay a single eur...o cent. So how can we fight all the cuts? How can we save all the hospitals, schools, university, childcare facilities, public transport, our pensions etc? The first step is organising a mass campaign. A good start will be made on 19 September in Den Haag (come to show support!). But this, by itself, will not be enough. Following on from this mobilisation, the Socialistisch Alternatief (the Committee for a Workers’ International, CWI, in Nederland) will organise an open meeting to critically discuss serious proposals for the way forward. We will present a general way forward, that applies to all countries, and also specific demands for the Dutch situation (which is nonetheless similar to other countries). We will show how mass struggles have worked in the past, and how they can work again, as well as learning lessons from the current protest movements in Southern Europe. Everyone welcome – we need to have discussion as a society. In both Dutch and English. SA: http://www.socialisten.net/ CWI: http://socialistworld.net/ Contact: wjardCWI@gmail.com Location: http://maps.google.com/maps?f=q&source=s_q&hl=en&geocode&q=amsterdam%2C+spuistraat+47a&aq&sll=52.347295%2C4.881878&sspn=0.033818%2C0.070124&g=Amsterdam%2C+North+Holland%2C+The+Netherlands&ie=UTF8&hq&hnear=Spuistraat+47A%2C+Binnenstad%2C+Amsterdam%2C+Noord-Holland%2C+Netherlands&ll=52.376064%2C4.892585&spn=0.004225%2C0.008765&z=17

Stop alle bezuinigingen, bundel het verzet!

2011-09-18T18:56:00.001+02:00

Statement by SA (CWI in Nederland):

Stop alle bezuinigingen, bundel het verzet!

De woede over het kabinet Rutte neemt steeds verder toe, en terecht! Natuurlijk voeren we actie tegen alle bezuinigingen die het kabinet al heeft aangekondigd en de bezuinigingen die het kabinet ons nog wil opleggen! Massale actie is nodig om te voorkomen dat wij en niet de schuldigen de rekening van de crisis voorgeschoteld krijgen! Maar nog belangrijker: hun remedies werken niet! Bezuinigen leidt tot krimp, zoals overal in Europa zichtbaar is. Kapitaal vlucht weg naar veilige havens, goud, Zwitserse franken, staatsobligaties van de VS en Duitsland. De werkende bevolking heeft deze keuze niet! De arbeidersklasse heeft geen andere keuze dan hard terug te vechten.

Het is de taak van de vakbondsleiding om het verzet te bundelen en een gezamenlijke, landelijke actiedag te organiseren tegen het kabinet. Vanwege het gerommel rond het pensioenakkoord heeft de achterban de vakbondsleiding al meerdere malen moeten terugfluiten. Steeds weer kwamen zij of het kabinet met kleine concessies, maar de hoofdzaak, de verhoging van de pensioenleeftijd en andere bezuinigingen bleven overeind. De vakbondsstrategie van pappen en nathouden is failliet: de vakbeweging moet het voortouw nemen bij het verzet, daarvoor is een strijdbare leiding en een democratische werkorganisatie noodzakelijk. Ook is het nodig dat de eisen van het verzet een politieke vertaling krijgen: de huidige partijen zijn allemaal voorstander van bezuinigingen, een echte brede arbeiderspartij is noodzakelijk.

Als wij de noodzakelijke massale, gezamenlijke actie willen tegen de bezuinigingen en tegen het kabinet, zullen we zelf stappen moeten ondernemen. Het is nodig dat er lokale anti-bezuinigingscomité’s (ABC’s) worden opgericht, die mensen uit verschillende sectoren die in actie komen, zoals bij het openbaar vervoer, de jongeren, buurtbewoners die vechten tegen sluiting van hun buurthuis, etc. kunnen verenigen. Dergelijke ABC’s kiezen een landelijk ABC, dat een massale landelijke actie organiseert en coördineert. Op de acties rond Prinsjesdag moeten een landelijke demonstratie tegen de bezuinigingen volgen als voorbereiding een 24-uursstakingsstakingen in verschillende sectoren. Dit zou een belangrijke eerste stap zijn in het opbouwen van massaal verzet tegen het kabinet.

Stop alle bezuinigingen, weg met dit kabinet

Voor een landelijke demonstratie en 24-uurstakingen om dit af te dwingen
Bundel het verzet, voor de oprichting van Anti-bezuinigingscomités
Tegen bureaucratische achterkamerdeals, voor een democratische bond van, voor en door bondsleden.
Voor een arbeiderspartij die de belangen van de arbeidersklasse politiek onverkort uitdraagt

OPENBARE VERGADERING VAN SOCIALISTISCH ALTERNATIEF:

Hoe kunnen we winnen? Hoe we alle bezuinigingen kunnen vechten.

30 SEPT. (Vr.) 19:00 - “HET GESPUIS” Spuistraat 47A-1 A’DAM

www.socialistischalternatief.nl

role of the internet: A question and answer discussion

2011-09-15T19:20:00.003+02:00

please keep in mind the slight delays etc ('real time chat') so that the answer to particular question are delayed by a few lines every now and then.

also keep in mind i am "bending the stick the other way" sometimes to make clear my main point.

·   JA:
o    I was just wonderin if you could tell me about the role of facebook in organising those demos
·

36 minutes agoSent from Chat
Wjard
o    ah yeah
o    well they were pretty important
o    they are like a lightning speed and very simple to use
o    my friends invited me thru facebook to spanish protests
o    but they were a new form of communication
o    they did not replace other forms of communication and letting ppl know, rather they augemented it
o    mind you facebook sometimes blocks big event
o    what else you want to know?
o    have a look thru my profile
o    you can see all the examples
o    but fb cannot replace face to face agitation and propaganda
·

33 minutes agoSent from Chat
JA
o    facebook blocks it?
·

33 minutes agoSent from Chat
Wjard
o    yes sometimes with claims of 'too many ppl' technical issues etc
o    i think thats bullshit
o    if you invite ppl on fb for a social event you might get 50 to 100% turn out
o    depending on event
o    for a political event you 10%
o    or lower
o    because there is that lack of face to face
·

32 minutes agoSent from Chat
JA
o    right right
o    but it does seem to be a fast way right
·

32 minutes ago
Wjard
o    the key point is that ppl think it changes everything
o    that is not true at all
o    the internet is merely a quicker tool
o    it has been proven that it does not alter the actual prgression of politics
o    yes its useful, because ppl are already all linked
o    but that is all.
o    infact it even 'slow things down' [ed: this thought was not finished - refering to 'internet campaigners' who might go out into society if it were not for the internet - a very small minority admittedly]
·

30 minutes agoSent from Chat
JA
o    it did seem to make a difference in the arab spring though
·

30 minutes ago
Wjard
o    because ppl do have illusions that the internet by itself will change things
·

29 minutes agoSent from Chat
JA
o    well no but I think it has potential
·

29 minutes ago
Wjard
o    no
o    thats not correct
o    i disagree [ed: response to " it did seem to make a difference in the arab spring though"]
·

29 minutes agoSent from Chat
JA
o    why not?
·

29 minutes ago
Wjard
o    it is important
o    but only as anauxillary
o    and not more
o    in all my experience the key thing is face to face
o    and there is so much crap on the internet, and so many facebook invite that, you begin to block it
o    like you do with advertising
o    here is an article i wrote that is related:
·

27 minutes ago
Wjard
o    http://radecon.blogspot.com/2011/06/draft-ideas-democracy-internet.html
o    Radical political economics for today's student: Quick Thoughts: Democracy in practice - internet.
radecon.blogspot.com
‎'In the same way that neoliberalism emerged as a response to the crisis of the 1970s, so the path being chosen today will define the character of capitalism's further evolution.' Harvey, The Enigma of Capitalism, pg. 11
Share
·

26 minutes agoSent from Chat
JA
o    well Im not necessarily talking about the whole fb event thing, but as far as I understood it, facebook was a key, at least in tunisia, to spread videos, information, demo plans and get organised quickly
·

25 minutes ago
Wjard
o    again : #

the key point is that ppl think it changes everything
#

that is not true at all
#

the internet is merely a quicker tool

the real question is not 'why not?' but "why should it" change anything - forms of communication have already existed for millenia, and recently quick sources of info incl phones etc has changed the speed, but not the actually quality of the process in society
·

24 minutes ago
Wjard
o    of course that is not to downplay the actual role that facebook played - it was quick. but the revolution would have probably happened anyway (eg by mobile phones or whatever) . ie it was a social process, not an internet process.
·

23 minutes agoSent from Chat
JA
o    do you not think that the internet has made the flow of information freer and makes it more difficult for a government exercise censorship upon the people?
o    I doubt I would have been able to come into contact with offensief as easily if the internet had not been invented
o    or socialist theory for that matter
·

23 minutes ago
Wjard
o    yes, a bit. but the degree to which it is totally exagerated. i just dont see the evidence.
·

22 minutes ago
Wjard
o    maybe. but then thats really a 'what if ' speculation
o    i mean if that were the case your life would be totally different
o    its almost unimaginable
o    but socialists existed in the 1840s!
o    you know what im getting at?
·

21 minutes agoSent from Chat
JA
o    sure
·

21 minutes ago
Wjard
o    you personally may not have discovered socialism. or indeed, you may have thru other means.
o    but ppl in general still did
·

19 minutes agoSent from Chat
JA
o    I do value the power and potential of things like youtube though
o    especially when I look at things like the underground rap scene
o    a lot of the music has a political message
o    and using youtube has made the music and videos more accessible
·

18 minutes ago
Wjard
o    yeah me too
·

18 minutes agoSent from Chat
JA
o    some of them have even entered the mainstream in terms of popularity and gotten offers from MTV and the like (which they did decline)
·

17 minutes ago
Wjard
o    yep
·

17 minutes agoSent from Chat
JA
o    I think music has a huge potential to get a revolutionary message across and the internet has huge potential to make it more accessible
·

17 minutes ago
Wjard
o    the revolutions might have evolved differently
o    but the underlying things - econmoy, society - were the real drivers
o    i agree im in favour of using the internet like that
o    but the new comrades would not have been recruited on the internet
·

16 minutes agoSent from Chat
JA
o    no perhaps not
·

16 minutes ago
Wjard
o    that was all down to face to face discussions
·

16 minutes agoSent from Chat
JA
o    but
o    of course
·

15 minutes ago
Wjard
o    and proving ourselves in actualy action eg GVB rally
o    where hidde joined
·

15 minutes agoSent from Chat
JA
o    I hadn't thought of it that way
o    but music, to a lot of people, is a factor that influences them into looking into socialist theory
·

14 minutes ago
Wjard
o    yep. but again that still happened in the past
o    ie the forms of communication might change
o    and of course thats important
o    but the fundamental drivers of the social processes are the same
o    so to speak
o    as marxists we do not look at the appearance of things
o    but at their essence
o    a fish with fins is not a thing in the water
o    there are salamders like that too
o    a fish is something that evolved from something and is changing into something else
o    im trying to say that appearances can be deceiving
o    and that the underlying reality is sometimes hard to see
·

11 minutes agoSent from Chat
JA
o    and what about things like
o    WikiLeaks?
·

10 minutes ago
Wjard
o    but to understand things in reality you must look and analyse deeply
o    again that might have happened through for eg a newspaper
o    ie a different form of communication
o    in fact those sorts of scandels happen all the time in the past
o    of course wikileaks makes it easier
o    and potentially more open
·

9 minutes agoSent from Chat
JA
o    and safer for the sources
o    I agree the phenomenon is nothing new
·

9 minutes ago
Wjard
o    well not necessarily
o    look at the dude in jail
o    and all the leaked sources
o    that same sort of thing happened in the past too
·

8 minutes agoSent from Chat
JA
o    it was much easier for me to download all those cables with one mouse-click than to go hunt around for newspapers, foreign and dutch ones, and look for leaked information like that
·

7 minutes ago
Wjard
o    yep
o    ie easier
·

7 minutes agoSent from Chat
JA
o    yeah
·

7 minutes ago
Wjard
o    but if youd bothered you could have done it by other means too
o    to a degree
·

6 minutes agoSent from Chat
JA
o    to a degree, but Id have to put significantly more effort into it
·

6 minutes ago
Wjard
o    yep
·

6 minutes agoSent from Chat
JA
o    and newspapers are generally more easy to control and censor are they not?
·

6 minutes ago
Wjard
o    computers have changed thing no doubt
o    but they are more reflective rather than actually changing things by themselves
o    agree
o    so its not a yes or no answer
·

5 minutes agoSent from Chat
JA
o    I agree
o    and the internet has allowed for a lot of bullshit as well
·

4 minutes ago
Wjard
o    its a question of degrees
however, i lean more toward a no becasue the drivers of social process have not actually changed
·

4 minutes agoSent from Chat
JA
o    no they havent
·

4 minutes ago
Wjard
o    the question being has facebook or internet changed or caused social changes
o    notice of course that i also use fabebook to build.
o    so i am very aware of its use.'
o    see especially the event of the XXX
o    the public meeting (we need you there)
o    i invited XXXX people that i couldnt have had access to before.
o    but i would be surprised if more that XX showed up
o    even 10 would be good.
o    the majority that will come because we talked to them or met the face to face etc on the demo on monday etc

excellent marxist resources

2011-09-13T13:19:00.003+02:00

1) MIA - independent http://www.marxists.org/
+ for beginners: http://www.marxists.org/subject/students/index.htm

2) Marxist resources from the Committee for a Workers' International -

a) all the basics (six pamphlets up the top + classics below) http://www.marxism.org.uk/

b) general from the CWI: http://www.marxist.net/

3) World economy - class based analysis - http://www.socialistworld.net/view/3

Expropriation of the Private Banks and State-ization of the Credit System

2011-08-28T23:01:00.003+02:00

Expropriation of the Private Banks and State-ization of the Credit System

Remarkable that the basic demands (esp. for Greece and Spain) have not changed much since 1938.

Imperialism means the domination of finance capital. Side by side with the trusts and syndicates, and very frequently rising above them, the banks concentrate in their hands the actual command over the economy. In their structure the banks express in a concentrated form the entire structure of modern capital: they combine tendencies of monopoly with tendencies of anarchy. They organize the miracles of technology, giant enterprises, mighty trusts; and they also organize high prices, crises and unemployment. It is impossible to take a single serious step in the struggle against monopolistic despotism and capitalistic anarchy – which supplement one another in their work of destruction – if the commanding posts of banks are left in the hands of predatory capitalists. In order to create a unified system of investments and credits, along a rational plan corresponding to the interests of the entire people, it is necessary to merge all the banks into a single national institution. Only the expropriation of the private banks and the concentration of the entire credit system in the hands of the state will provide the latter with the necessary actual, i.e., material resources – and not merely paper and bureaucratic resources – for economic planning.

The expropriation of the banks in no case implies the expropriation of bank deposits. On the contrary, the single state bank will be able to create much more favorable conditions for the small depositors than could the private banks. In the same way, only the state bank can establish for farmers, tradesmen and small merchants conditions of favorable, that is, cheap credit. Even more important, however, is the circumstance that the entire economy – first and foremost large-scale industry and transport directed by a single financial staff, will serve the vital interests of the workers and all other toilers.

However, the state-ization of the banks will produce these favorable results only if the state power itself passes completely from the hands of the exploiters into the hands of the toilers.

Trotsky, 1938 http://www.marxists.org/archive/trotsky/1938/tp/tp-text.htm#pb

basic capitalist economics (outline of speech given aug11)

2011-08-23T18:22:00.002+02:00

NOTE it is useful to watch this 10min video before listening to the speech (or notes thereof):
http://www.youtube.com/watch?v=HDvnSgJF4SE&feature=related

The Economics of Capitalism – Marxist Economics

OULINE:

(0) intro

(1) flow of capital (circuit)

(2) profit

(3) problems in circuit

(4) summary

PART 0: intro

§ Capitalism – system we live under – where a minority owns most wealth

o eg Wealth distribution US 2009 – top 1% own more than bottom 90% own combined – no accident)

§ Socialists fight for majority to control society’s wealth

o Wealth + income distribution shapes everything – how much we are able to consume, how much health care we get, the level of unemployment, and through that created poverty level of crime.[1]

o Also core of all workplace struggles + all politics

§ understanding economics is vital – at core of most problems in society.

§ Capitalist press will try to baffle you BUT

§ Luckily – pretty simple – one basic concept – capital.

§ Capital = defining characteristic of economic system

§ Today word ‘capital’ is used in lots of ways – cf ideas, human capital (we will not used these ideas)

§ We use Specific definition

PART 1: Flow of Capital (the circuit)

§ Capital is people (“capitalists”) using money to make more money

o Legal + illegal ways

§ lending out money, make interest

§ Renting land out

§ Lease equipment

o in general – production:

SLOWLY “Circuit of Capital”:

M → (MP + LP ) → PP → C → (M + DM)

§ M: money

§ MP:[2] stuff you use to use to produce more commodities

o machines, buildings, energy, raw materials, intermediate materials etc

o eg a printing press, hammers, workbenches, wood, kitchen knives, steel, steamship

o Privately owned

o If a hammer is used in production then it is capital, but not if we use if at home.

§ LP[3]: Capitalist buys capacity to labour, for eg 8 hours. (not the whole person, as in slave society)

o workers turn MP into commodities.

§ MP + LP combined with a particular technology, which includes organisational forms such as a particular management structure, in a production process, which

§ produces a commodity

o chair, fridge, printer, pens, beer, massage, hamburger, industrial ship, machines

o any good or service produced by human labour for sale – can be a final consumer product or service, or itself means of production

o including a ‘service’

o in fact any commodity will be produced – the capitalist does not care what it is – only that it makes a profit.

o In this sense capitalism is the production of capital itself, as opposed to particular goods or services.

§ Then sell C for M plus profit

§ The original (M) + part of new money (profit) is then re-invested in a process enforced by competition,

§ same process starts again.

§ Marx: “generalised commodity production”

PART 2: Profit

§ RECAP

§ Capital any form of value (measured in money) – money itself, means of production, labour power, commodities – that is used to produce more value at the end of the day.

§ This ‘more value’ is what is called ‘surplus value’ or ‘profit’[4]

§ rest of this section – ‘where profit comes from?’

§ runs out – profit come through ‘exploitation’ of labour, in effect stealing value that workers produce in excess of their wage.

Note – to do this, we must first have:

CLASS SOCIETY

§ our society today is divided into 2 classes:

o Capitalists / Bourgeoisie / ruling class

§ own means of production

o Working class / Proletariat

§ have to sell labour power to live

o Some in between – however, this is essential division

§ Class society is not a new thing –

o Slave society – people were owned

o Feudalism – serfs dominated by landlords

o In these societies there were lots of classes, now simplified.

PROFIT

How can we understand – how $100 at start of day, end up being $150?

§ Off course it is always possible to rip people off in the market place, but this is not a source of new value

o Eg. if a car is worth for $750, but is sold for $1,000

o then the buyer loses in $250 and seller gains that $250.

o But this is transfer – does not create new wealth.

§ Profit has to do with “Labour power” – a very special commodity.

o When a capitalist buy LP, they are buying your capacity to work for a certain time, for eg 8 hours or week or a year

§ LP is only commodity you can buy which can produce more value than it cost!

§ Amount of work done – amount of value created is not predetermined

§ Value created (ie C)

o minus cost of labour power (LP)

o minus cost of means of production (MP)

o = surplus value / profit (SV)

o = unpaid labour

o SV = C – LP – MP

§ THIS IS THE THEORY OF EXPLOITATION

§ Note – direct trade off between profits + wages

o Lower wages means higher profit

o Higher wages means lower profit

o No relation between wages and profits (if you produce more value you do not get paid more)

o CONSTANT BATTLE: ‘class struggle’

§ Why would a worker sell her time for less than the value she will create?

§ not obvious – probably not aware.

§ In mass production you do not directly see the results of your labour

§ Even if aware – no choice – buy food to live (you don’t have capital)

§ We can refuse to work (strike)

o But capitalists have more money, can hold out longer

o Use unemployed workers against employed workers

o In fact: larger problem of diving workers (race, gender)

PART 3: Problems in the Circuit

Recap: M → (MP + LP ) → PP → C → (M + DM)

3A: Continuity

§ Some DM consumed by capitalist class, but most will be reinvested – why?

o Money is a form of social power that people can own – so they want more

§ MOST IMPORTANT = Coercive laws of competition

o If the capitalist doesn’t constantly innovate, make production more efficient and cheaper, then his rivals will.

o Then he will not be able to sell more, rival goods cheaper.

§ SO Continuity of the circuit is key – flow has to be maintained. When you have a blockage anywhere (or everywhere) it’s a ‘crisis’

o Eg 9/11 – everyone stopped spending and Gulliani + Bush on TV

§ whole thing is about growth.

o ~3% growth for the system to be OK

o but 3% compound growth forever?

o So that means a capitalism could not function at 0% growth.

o Means you need more LP and MP next time

§ Capitalists are compelled to invest:

o ‘over-accumulation’ – when there is too much capital, too efficient, the commodities produced is no longer profitable.

o Eg. property: China, Spain

o associated disproportionality: when one industry produces to much and another too little.

§ It is never clear beforehand which industries or products will be most profitable – so lots of moving capital around in response to ‘over-accumulation’ and disproportionality

§ Part of sources of where cyclical nature of capitalist economy

3B: More problems – barriers or blockages at each stage.

§ M – has to be in the right place, right time, right quantities

o Credit system KEY – tremendous power concentrated there

o 1970s ‘repression’ was a problem

o ‘credit crunch’ 2008 – banks refused to lend (huge problem)

§ MP – oil prices starts to increase, you have to spend time and money adjusting the PP.

o How society relates to nature

o People who land (rentier class) – and monopoly power becomes important

§ LP – labour power

o Individual workers can organise into trade unions and get higher wages, than if they were individuals who compete

§ This is what we want

o Eg Labour had lot power 1970s – capitalism was organised nation states basis, and political pressure pushed up the social wage

o Offshore, but in order to offshore you need capital to be able to flow overseas.

o Political solutions – neo-liberalism

o Eg Reagan and Thatcher in the 1980s attack union and worker rights

§ PP – resistance to exploitation[5]

§ C → (M + DM) hardest part – someone has to buy all that stuff we produce!

o Won’t go into – but have to have more money at the end of the day than you did at the start.

§ In the past China India – gold from outside the capitalist system

§ Now internalised:

· Effective demand today, depends on expansion of system tomorrow

· Credit system

· Eg lend money to developers, and lend money to buyers!

Lots of potential problems at each point – the result in volatility and anarchy (not a single reason for crises, but lots )

§ Capital does not solve its problems, but moves them around

o Eg LP in 1970s, so you repress wages to control them

o But then who will buy all the stuff?

o Answer: credit cards!

o Now debt problem

§ So financial crisis – stabilised by state

o So state crisis – austerity

o But again problem of demand – who will buy all the stuff!

§ So you cannot solve these problems only shift them around

Part 4: Summary

o Capital – people (capitalists) using money to make more money

o M → (MP + LP ) → PP → C → (M + DM)

o Means you need class society – workers and capitalists

o Workers produce all the value in society, but capitalists own it.

o That is because capitalists own means of production and through that, all commodities produced

o Permanent class struggle – battle over distribution of value produced

o cannot be changed without getting rid of capitalism – without profit / growth the circuit will stop = crisis

o inevitably leads to massive inequality

o also leads to super exploitation of environment

o Role of politics (and control of the state) to represent class interests

o unplanned à Capitalism is anarchic – it cannot be any other way, you cannot control it.

o This leads to business cycle, and also generalised crises.

o Market system does not work for ordinary people – only for capitalist – but with democratic planning of production and distribution we can improve standards of living and avoid most of the problems we have now.

Appendix

Source: Economic Policy Institute, The State of Working America 2011, "Wealth Holdings Remain Unequal in Good and Bad Times."

Wealth inequality can be assessed by looking at the share of wealth owned by the richest 1 percent of Americans. In 2009, this top 1 percent of U.S. households owned 35.6 percent of the nation’s private wealth. That’s more than the combined wealth of the bottom 90 percent.

[1] also shapes culture and what Marx called the economic, social + legal superstructure

[2] means of production

[3] labour power

[4] technically SV is larger category including profit (from eg production), rent and interest. The distinction is not important here and we use ‘profit’

[5] technology – too slow or too fast

where does profit come from?

2011-08-23T18:19:00.000+02:00

Three points came up in discussion that are worth emphasising:

§ Capital is people (“capitalists”) using money to make more money.

o Basically the capitalist has money (M) with which they buy means of production (MP) and the labour capacity (LP), which they combine with a particular technology (incl. organisational forms [eg. management]) in the production process (PP) to produce a commodity (C) which they sell for the original amount of money plus some extra money (M + M').

o The original (M) and a part of the new money (profit) is then re-invested in a process enforced by competition, and the same process starts again. In this sense capitalism is the production of capital itself, as opposed to particular goods or services.

§ Capitalism is inherently exploitative. How can $100 at start of day, end up being $150? (we discussed it cannot be through ripping people off, since this is just a transfer of value, not new value.) Profit has to do with “Labour power” – a very special commodity. LP is only commodity you can buy which can produce more value than it cost!

o The amount of value created (C) minus cost of labour power (LP) minus cost of means of production (MP) = surplus value / profit = unpaid labour.

o Note there is direct trade off between profits + wages

o Lower wages means higher profit

o Higher wages means lower profit

o No relation between wages and profits (if you produce more value you do not get paid more, unless you fight for it)

o ie. CONSTANT BATTLE: ‘class struggle’

§ I.e. Reform of capitalism is not possible: If there is no profit, there is no production, because capitalists will not have the incentive to invest.

Money and socialism (and inflation)

2011-08-23T18:17:00.008+02:00

I've been involved in a lot of discussions recently about money.

Here is one aspect to consider about money:

Money is a commodity for which other commodities (milk, steamships, massages, hamburgers, machinery, factories, labour power etc) are traded. Money represents value, specifically exchange value (how much of one thing can be got for another thing).

In the past money was bound up with commodities whose value was relatively stable, for eg Gold. This is called "commodity money". Today of course that is not the case. We use instead fiat ('trust') money [and increasingly in the form of account money (numbers in a bank account) rather than literal cash]. This has to do with increasing amounts of money required as capitalism expands (again, see "lifeblood" - capitalism must expand (i.e. make profit), otherwise it certainly would collapse).

This means the amount of money in the economy (M) must also expand. We will see in a moment how this is done through loans (by banks creating money; this is true even if a central bank 'controls' this process [it actually doesn't -see another the entry about the CB]).

So, we have said that cash is in effect based on trust ('fiat'), sort of made up from nothing by banks (ex nihilo). This fact leads a lot of people to conclude that it is 'fake.' However such a conclusion is one-sided, it does not take into account the value that is 'normally' created, associated with particular amounts the bank credits to the account of the (capitalist) borrower.

A capitalist, let call him Moneybags, goes to the bank. He want to invest in the increasingly profitable widget industry. On showing a business plan to his friend Scrouge, Moneybags is credited (given) $1,000,000 in his account. The bank, in essense created the money. With this million Moneybags buys a factory, a certain amount of labour power, means of production and perhaps some copyrighted technology, management plan or brand name, which he uses on licence.

Lets consider 2 Scenarios.

Scenario 1: After a year Moneybags sells all his Widgets and makes back all of the $1,000,000 he invested, and $250,000 extra ("surplus value"). So he pays back his mate Scrouge at the agreed rate of 10%. Having paid his $100,000 interest, his profit is $150,000.

Now there is an $1,250,000 in circulation, that did not exit before. All this extra money is reflected in extra value that has been actually produced.

Scenario 2: Soon after Moneybags takes on his loan, he finds that his Chinese competitors - who use cheaper labour and don't bother paying licence fees - produce cheaper widgets. His market share shrivels to zero, and he cant sell a single Widget at all (for simplicity - this case is easily expanded). He cannot pay back any of the loan, having paid all his suppliers the $1m.

Now all the $1,000,000 has gone into circulation, and the suppliers - who sold Moneybags real things of value (to the tune of $1,000,000) spend their money in turn. However the $1,000,000 invested quickly depreciated (becomes worth less, eg machinery is now less useful having been installed already), perhaps half of the value is in effect destroyed. That amount of money, however is still floating around the economy - but is has not produced any extra value.

That means we have more money ($0.5m) but no extra value in society. i.e. inflation (money losing its quality).

I want to point out two basic facts: money and debt are created. But generally they will be related to the real economy in the sense that they will be used to create extra value (scen. 1). When Scen. 2 happens we have a source of inflation (there are others too).

Secondly - we havent really touched on this yet - capital (initially money here) is used to buys workers' capacity to labour (LP) to produce Widgets. No worker really want to make 3,000 Widgets a day, that is not inherently satisfying etc (see Marx on alienation) (but Joe the Worker has no choice cos he has to eat and pay rent). At the end of the day the extra value the worker produces is appropriated by Moneybags (and thru Moneybag, Scrouge). i.e. Joe the worker is alienated from his product.

In that sense capital was used to exploit the worker, i.e. money was used in an exploitative, alienating way. This is inherent to capitalism. (Capital must appropriate the new value that the worker creates - i.e. it must extract a profit.

However in a democratically planned economy (i.e. socialism) the worker will be intimiately involved in production decisions ("workers control over industry") alongside input from the consumer. ("democracy is to a planned economy as oxygen to the human body").

Ie the exploitative character of money will (over time) disappear. If banks and the commanding heights of the economy were democratically control by workers and consumers (also workers) then instead of "for profit" adventures in the market (cos its always a guess what will be profitable), money will be used for social need (hospitals, schools or whatever the democratic macroeconomic plan requires).Again, money will eventually cease to have an exploitative character and will eventually by only a unit of account.

Comments, corrections most welcome, this is an unedited "back of the envelope" thought, like most of this blog :)

Concrete proposals for Syntagma, an example for Indignados movements generally

2011-06-30T02:28:00.000+02:00

The following can be applied to all occupation movements. I think this document is worth spending some time reading.

Time to get rid of them!

They write memorandums – we write history!

The Greek trade unions have called for the first 48 hour general strike since 1992, on 29 and 30 June. The movement of the ‘enraged’ and the activists of the workers’ movement demanded this step, against the vote in the Greek parliament on the second memorandum - a new package of austerity imposed by the troika (EU, IMF and European Central Bank). This vote is planned to take place on 30 June.

The battle is now at a new peak with the attempt of the government to ignore the occupations of the squares, the ongoing strike of the electricity workers to stop the memorandum and the plans for further privatisations, the general strike on 15 June and now the new challenge of a 48 hour general strike at the end of June.

Below we publish the proposals and demands which Xekinima, the CWI in Greece, puts forward in the movement of the ‘enraged’, which is still occupying major squares in different cities, and the workers’ movement.

Socialistworld.net

500,000 demonstrators in Syntagma Square on Sunday, 5 June. More than 200,000 in Syntagma for the general strike on the 15 June. And a government of crisis that is hanging on by a thread, which is shown by the fact that the Prime Minister – full of panic – quit and “de-quit” on the same day, 15 June.
A new movement is shaking Greek society while Europe watches. The movement of the Enraged creates new hopes and possibilities and at the same time constitutes the clearest answer to the bureaucracy of the trade union movement and the leadership of the mass left parties, which have never put themselves in the front-line to develop a real mass movement. It is the first mass movement that is so clearly and categorically against the bureaucracy of the trade unions and inadequacy of the mass left parties.
The movement of the Enraged can stop the new memorandum and bring down the government. This can come true. But what could also happen is that within a few weeks this movement might not exist anymore. Didn’t the movement “I don’t pay” [with non-payment on buses and trains and tolls on motor ways] have some of the same amazing characteristics? But it faded away within three month. That is why the next steps of the movement of all of us, the Enraged, are of crucial importance.

Everybody to the squares! Escalate the strikes to force them out!

The first step is of course, that everybody goes to the squares in order to build a mass movement from below in order to turn the squares into living organisms of resistance. The half a million people who demonstrated on 5 June must become one million. This means we must set the dates for an escalation of the movement. We must set dates for general strikes and link the movement of the squares with industrial action by workers and with the neighborhoods as well. The call for a 48-hour general strike by GSEE and ADEDY [private and public sector trade union confederations] for the first time in almost 20 years is an important development and in reality a success of the Enraged as it was the pressure from the squares which led to this development.
However, this is not enough. There should be a further escalation. The leadership of the unions will not take the necessary action. We have to impose it from below. The movement of the Enraged can play a catalyst role towards in this through its decisions. Xekinima proposes that the assemblies of the squares discuss, decide and call for:

Use the 48-hour general strike, called by GSEE and ADEDY [private and public sector trade union confederations] for an all out, full mobilisation of the mass movement.
For the DEKO unions [public services / state-owned or semi-state owned companies] to proceed to a 5-day general strike the week before the new memorandum is put to parliament.
For a general, huge demonstration on the day of the vote on the memorandum in Athens and a similar rally in Thesaloniki, with the aim of bringing one million to Syntagma Square.
If the government insists on voting in the new memorandum, then there is no option but to prolong the general strike for as long as necessary and remain at Syntagma square until the government falls. The government can survive a continued occupation of the squares, but they cannot survive a continued general strike.

Links with the workers’ / strike movement

There are people who think that the squares do not need or don’t want the labour/trade union movement, because trade unionists will ‘patronise’ the movement. Their concerns are understandable but they are not correct. If the movement of the Enraged does not extend itself into the workers’ movement and is not linked with strike mobilisations, there will be an extremely big danger that it will subside.

Therefore, we want and we need all the movements to approach / direct themselves towards the squares and the occupations. Those who are engaged in struggles - workers’ strikes, youth, environmental struggles, social struggles – must go to the squares, set up camps there and keep the occupations alive and vibrant. We want the strikers of DEI [electricity company], post offices, OTE [telephone company], the temporary council workers etc. - all to go there. We want the strikes of the different sectors to escalate into general strikes, not symbolic ones (one every two or three months), but substantial ones, repeated and escalated.

Democracy in the movement. But how?

The bureaucrats of the trade unions and party apparatuses have time and again sold out struggles in a blatant way. Measures should be taken that ensure the democracy of the movement.
Many of the Enraged demand that parties do not show up in the squares. Although this is understandable, it does not offer any solution, because various parties are already there and actually a lot of them are hiding behind the “anonymous” or “party free”. This is exactly why they are doubly dangerous.
We must stress that the danger of bureaucracy does not only come from parties, but also from cliques of people who suddenly see the possibility of putting themselves in the spotlight via the movement, making blogs and spending a lot of time in the squares to establish themselves and gain publicity. It is not a coincidence that it was discovered in Thessaloniki that some “non-party” people wanted to impose as the only speaker in a demonstration on the 5th of June the nationalist right wing politician Dimitris Antoniou!

Democracy can be protected only through a series of measures:

First, of course, all decisions should pass through the general assemblies.
The parties and organisations that intervene in this movement (and rightfully so) should do that overtly. Stop the hypocrisy of party members that pretend they are “party free”.
Every political force should have only one contribution at the assembly, so that everybody knows who is who and what they say. The rest of the time should be given to the un-affiliated.
The coordinating committee of the assembly, those behind the microphones, should rotate. Every three days the team must be changed.
No trust to any individual or any party apparatus – only to the democratic procedures of the movement. This should be an unbreakable rule, not only for the assemblies of the Enraged, but for all movements anywhere and at any given time.

Democracy of the square and democracy of the movement

The democracy of the assembly on Syntagma Square or the White Tower [in Thesaloniki] must not be confused with the democracy of the movement. Because at the end of the day even if we have 3,000 or 5,000 people in the assembly, how can they represent the half a million people we saw on Sunday, 5 June? And how is it possible for all of them to say what they think or propose an issue to be voted on, given the limited time and number of speakers at every assembly? It’s impossible.

The answer to this dilemma is:

Extend the movement to all work places, workers’ neighbourhoods and the youth (universities and Schoools), as suggested above. Call mass assemblies in all these places and areas and elect committees of representatives, that are subject to recall at any time.
The Syntagma assembly, once or twice a week should be an assembly of representatives of the movement from all the corners of Attika [whole region around and including Athens and Peiraus]. The same goes for the White Tower in Thesaloniki and so on. These assemblies should be responsible for the final central decisions.
These representatives should be in constant interaction with the assemblies that have elected them, be accountable to them and at any time subject to recall (ie every assembly can replace them with other representatives at any time).

Only in this way can the mass movement control the way the struggle will develop. Anything else – whatever name it may bear – is a democracy only in words, neither “direct” nor “real” democracy [which is one of the central demands of the movement of the Enraged].

Is there an alternative political solution?

The people who participate in the movement of the Enraged now feel the power/strength of the mass movement and realise that they can bring down the government. The question that emerges then is what will follow? Because obviously, bringing down Pasok just to bring back ND or a coalition government or a government of “technocrats and personalities” is not a solution.
The first answer to this question is that it is important that the Pasok government falls, even if it is not clear who will follow, because the next government will live under the constant threat of the movement and the danger of being overthrown.
We should remember Argentina, where during the winter 2001/02, five presidents fell within a period of a few weeks. In the end, this movement forced the Argentinian government to pause the payment of the sovereign debt. This represented a great victory initself! But it could not achieve the overthrow of power of the capitalists or free society from poverty. Therefore, we need something more.
If we leave our fate in the hands of a few hundred corrupt individuals in parliament, entirely outside our control, elected for 4 years on the basis of lies and false promises but without us having the means to replace them, who rely on big money from the capitalists to get elected and then represent precisely these capitalists and not the people who vote for them, who rob us of the wealth we produce, then the problem remains. What is the answer to this?

We want a kind of “parliament” in which those elected will be accountable and subject to recall at any time.
We want representatives, that will be paid as much as the workers – and not €10,000 per month – representatives without any privileges or connections with business’ interests. Those who break these rules should be punished with severe prison sentences – all laws which allow the “buying out” of sentences and the “writing off” after some time of such offences, should be abolished!
These conditions can be imposed only if representatives are elected through mass assemblies in the workplaces, neighbourhoods, universities etc and if these representatives are accountable to those assemblies and subject to recall at any time.
Such a “parliament” of the workers and the popular masses could proceed to the establishment of a real “people’s power”, meaning a government “of the workers for the workers” in the service of society and the working classes.
Is this a difficult prospect? Yes, a very difficult one. But why? Because, right now, the movement is limited only to central squares and is not expanding in width and depth through society, in an organised way. And because the movement does not consciously set the above targets for itself. But if the movement was able to develop in the way we describe, then the election of those representatives and those who would “govern” in the way we describe, would develop in the most natural way: They would be individuals who represent the rank and file movements in society and not the interests of big business and they would be under constant control from below.
Thus and only thus will the words “real” or “direct” democracy acquire a true meaning.

Is there an alternative economic policy?

Our living standards are falling apart. The right to work is disappearing. Pensions have taken a merciless blow, education and health are driven to the bottom, rights – that we have had for an entire century – are squashed! They have taken “everything” away, and they will come back for more. Why? To pay back the soveign debt – so they say! But, who created the debt and why should we have to pay for it?
[In the original text by Xekinima this is followed by an explanation why the debt is not ours.]

We demand:

Those who caused the crisis should pay for it. This means: refuse to pay the debt they created to increase their profits, which is now reaching €350 billion, 150% of the GDP.
There are €200 billion in Greek bank accounts, which is our own savings, as the rich and the big capitalists have already taken their money abroad – €60 billion last year alone. The bankers use our money in the bank accounts against us, in order to make big profits, and the justification for this is “the needs and the demands of the markets”. We refuse to accept their logic, we demand that the banks are nationalised – that they are placed under the ownership of society.
We should demand to know where the profits of all the past years have gone. From the mid 1990s until 2007, the Greek economy was growing by 4-5% per year. And Greece was the ‘Eldorado’ of profits, with profits reaching 20-30% per year. Where is all this money? Why are the profits theirs, and the losses ours?
No to the privatisations of DEI [electricity company] and the other DEKO [public services]. Stop the robbery of the public wealth. Stop the sell-off of public companies. On the contrary, put these companies under the control and management of workers and society so as to abolish the corruption of the tops in the civil service and in the Trade Unions.

On the basis of all these, with the €350 billion that we “save” if we refuse to pay the debt and with the €200 billion that exists in the banks, we could create miracles in the economy. We could transform the situation completely, create jobs, have decent healthcare, education, pensions and public housing. We don’t need and we don’t want the speculators of the stock markets and the banks. Those who say, that “this can not happen” (or that it would be old-fashioned and obsolete) are doing what they have been taught very well by the system: they lie.

Finally…

We demand a society of justice, equality, freedom and real democracy. We demand a society that will not be slave to the profits of an insignificant minority, but that will plan the economy for our needs. And yes, we should re-establish the real meaning of many words, who have been misused by the ruling elite, as the assemblies of the Enraged are already proposing.
Democracy means that we decide and control all decisions and not the liars and thieves in the parliament.
Justice means that laws serve society not oppress it.
Freedom means to be able to have an opinion and express it freely and not that public opinion is formed by 5 families that control the economy and the TV channels.
And socialism means all the things we described above for the economy, politics and society – and not what the so called “socialists”, Mr. Papandreou [the Prime Minister] and the gang of thieves and liars around him, are pursing.

This document comes from here: http://www.socialistworld.net/doc/5160

Xekinima (CWI in Greece)

"This Is What Will Happen If Greece Defaults" reprint

2011-06-22T00:24:00.002+02:00

http://www.businessinsider.com/this-is-what-will-happen-if-greece-defaults-2011-6?op=1

Debtocracy

2011-06-12T16:36:00.003+02:00

Debtocrary. Good greek film with subtitles, about the crisis.

See the Guardian's Review here.

The evidence on privitisation

2011-06-06T22:00:00.004+02:00

Why the emphasis on selling public assets?

"It's certainly not improving budgets: In 1994 EU governments privitisation proceeds ran at $33B or 0.44% of GNP. Looking at the longer run, Britain, Europe's most dedicated privitiser ,averaged some 0.07% of GNP each year from 'selling the family silver.'" (394 Gartner Macroeconomics, c2006).

So why?

For detailed evidence see Chapter 2 from Andrew Glyn's 2006 book Capitalism Unleashed: (see 37-42. largely based on OECD statistics)

ch2 -

Quick Thoughts: Democracy in practice - internet revolution or participatory democracy?

2011-06-05T00:24:00.020+02:00

What kind of a movement do we have? and which kind do we want?

There has been a lot of debate about how we should implement our own internal democracy. There have been a lot of suggestion that we have internet voting. That attitude is to be applauded, and the attitude of inclusion is 100% indispensible. We wont change way things are without the fullest possible participation. There are however several problems we have to consider.

The first is who we are. Are we an internet or facebook group? I think the consensus is that we are not. The consensus is that we take the problems into our hands and try to do something about them. We are activists. And in that sense we participate, both practically, and in political debates.

In debates about actions and political demands, the most crucial thing is the dialogue. It is in the dialectic of discussion, that different views affect one another, and hopefully, come to a new synthesis. This is how we reach consensus, or majority. How can we have a constructive debate on facebook? Anyone who has tried to follow the debates will know this is not a constructive way of reaching a conclusion with a large group of people. The internet, facebook etc, are important ways of communicating before coming to informed decisions. But not, as it were, the place to decide and quickly understand one another, form a view that has a wider perspective than that we started with. (Moreover, do we want internet revolutionaries or real ones? Do we want fascists to participate, and vote? Probably not.)

This leads me to the conclusion that face-to-face discussion is really the only practicable way of doing anything in a fair way. This also means there is a correspondance between those taking the decisions, and those implementing them. It is counterproductive if the ones doing the work do not feel the decision was reached fairly. This is undemocratic in the sense it will stop participation.

Of course face-to-face discussion, decision making has problems of it own, including of course the tyranny of distance, and time. It is not always possible for people to attend rallies and assemblies. They have families, relationship, work, lives. One way to mitigate this such problems, is for eg. to provide childcare, and many progressive organisations do this where possible. Another is make sure there are regular times for discussion and assemblies.

In terms of time, we can mitigate the effect of endless confused dialogue by having a clear agenda. Two minutes of discussion to decide what the issues are establishes that agenda, and a moderator can then keep the discussion focussed. The moderator then becomes impotant, and should not be involved strongly on any particular side of the debate (unless circumstances dictate there is no such person). This is much more democratic, in that it is less time consuming and frustrating. The agenda should be flexible incase important things come up in the discussion.

The next question is what do we do in urgent situations? Which subgroups, assemblies etc have decisions right? For that, the group needs to talk abtout what kind of structure of organisation it want (totally 'horizontal'?). If it is not totally horizontal - there is always someone who is doing some work that involves decisions - how are these 'representatives' controlled? For example, if elected (note that we have no elected positions whatsoever), is there the right of recall representatives, if they cease to be representative?

Especially on actions it key have a flexible approach which corresponds with what is happening on the ground. How can we do this democratically? In certain situations electing people to act as steward may be necessary.

This all necessates figuring out what we are - what is the glue that binds us?

How we use mass collective action will shape how effective we are. That is why the movements in Spain and Greece have been so strong, because they are using these methods. (This does not mean that the individual is not important! The opposite is the case – each individual is freely contributing in their way, and realising their individual potential as a part of the collective.)

This is a tentative post (reserve right to change it) for us to start thinking about things, as clearly as possible. This issue deserves some thought. Without clarity there is always the danger of democracy being swept aside without anyone realising!

Greek debt in simple mathematics

2011-06-04T00:26:00.023+02:00

By Stavros Lygeros, ekathimerini.com

It took one publication saying that Germany was ready to agree to an additional loan of 60-65 billion euros for optimism to soar in Greece. Even the gasping Athens stock exchange perked up.

Prime Minister George Papandreou and Eurogroup chief Jean-Claude Juncker said they agreed on how many lives to destroy with this tranche.

The truth, however, is that clouds continue to darken the horizon, as the memorandum is based on the assumption that by early 2012 Greece will be ready to return to the markets. The way things look right now, though, it is unlikely that the markets will be ready to open their doors to Greece.

In order for a default to be avoided, Greece needs to either restructure its debt or to receive additional loans. The European Central Bank rejects the idea of restructuring. The only option that is under consideration is a voluntary reprofiling to avoid triggering credit default swaps. This is the reason why the eurozone is increasingly warming to the solution of a new loan package.

But let us look at the issue in terms of numbers: Even on the off chance that Greece’s primary debt is completely wiped out, in 2012 it will have to pay some 52 billion euros (35 billion in mature bonds and 17 billion in interest), while it is expected to receive 12 billion euros from the troika. In 2013, Greece is not expecting to receive anything from the troika, but it will still need to pay approximately 44 billion euros (27 billion in mature bonds and 17 billion in interest). Basically, it needs to have more than 84 billion euros for the 2012-13 period alone, so even if it receives a loan of 60-65 billion euros, it will still have a shortfall of 20-25 billion. Ostensibly, this amount is supposed to be covered by privatizations and the sell-off of state assets.

Life, however, does not end in 2013. Where will Greece find the tens of billions of euros it need annually to service its massive debt? And what will happen after 2014, when the amount to cover interest rises?

The recipe of spending cuts cannot alone make Greece’s debt sustainable so that it can begin borrowing from the markets. Inclusion in the permanent European mechanism, meanwhile, will merely recycle rather than solve the problem by feeding speculation over Greece’s possible expulsion from the eurozone.

How exactly do bonds work?

What should be done? (this bit ekathimerini didnt write ;)

The revival of the Greek economy in any kind of foreseeable future can only realistically be achieved through a break from the politics of free markets. Capitalism has clearly failed. Austerity is no solution, it will only depress the economy and futher immiserate Greek working people. The best out of bad lot of choices is complete repudiation of the debts, and nationalisation of the banks under democratic control. Greek and Spanish (and European) people should not pay for the failed speculation of big business.

The latest macro figures here.

NEWS: Bond traders continued to view Greek debt as hugely risky. The yield, or effective interest rate, on Greek two-year bonds hit 29.639%, a new record. The cost of insuring Greek debt against collapse spiked, with the five-year credit default swap leaping 174 basis points to a record high of 1,900, according to Markit. That means it would cost €1.9m to insure €10m of Greek debt. See here.

Timeline: see here

GVB ACTION 7 JUNE 2011

2011-06-03T19:16:00.003+02:00

GVB workers (public transport: metro and trams) are fighting against a 40% cut to services in Amsterdam (120 million euros). This is bad for everyone! Therefore the assembly of Greek/Spanish/‘Dutch Revolution’ Group of 01 June 11 decided to support the GVB workers. We will demonstrate our solidarity, and make the point that we all face the same crisis.

We want as many people as possible to attend, and build for, the assembly!

The GVB strike meeting is on Tuesday morning, 7 June 2011. We will meet 10am at entrance to Waterlooplein Metro Station (near the tram stop). We will then go the GVB strike meeting 10.30am.

Ideas for slogans for the banner include:

“Spanish, Greek and European youth support the GVB workers in their struggle again budget cuts to bail out the banks!”
“GVB workers’ struggle is our struggle – in all countries we fight against budget cuts to bail out the banks!”
Everyone should obviously bring his or her own messages too!

If you want to help organise: radecon11@gmail.com

EXPLANATION OF THE GVB ACTION

There is a strong consensus that we need to build our group, to sustain momentum. We need to get our message out. We have discussed linking with other groups, including workers on strike.

Therefore it was proposed to assembly of 01 June 11 that we collectively attend the GVB strike rally on Tuesday morning at 10am, Waterlooplein. They are fighting against a 40% cut to services in Amsterdam (120 million euros). This is bad for everyone!

At that assembly, there was a strong consensus that we attend. Today we want to build that consensus. Our power is as group of people fighting the same crisis. That is why the movements in Spain and Greece have been so strong, because they are using mass collective action. (This does not mean that the individual is not important! The opposite is the case – each individual is freely contributing in their way, and realising their individual potential as a part of the collective.)

A subgroup was arranged to handle organisational matters. So far we have organised a banner, to be painted today. Also we are making a small leaflet explaining that we are fighting the same crisis as the GVB workers. There are at least three facebook events, and lots of announcements. If you want to contribute organisationally, please see us (Wynand, Jelle, Vassilis, Perikles)!

The connection between Spain, Greece and GVB: The world economic crisis of 2007–now, which led to bursting of the property bubble in Spain, and the debt crisis in Greece, affected every country. First it was in the US, then the crisis shifted to government budgets, especially in Europe, as states bailed out the big banks that caused the crisis through massive losses on speculation.

Outrageously we – Spanish, Greek, Irish, EU, US, in short everyone – are being told “You have to pay.” But we (ordinary people) didn't create the debt! That was the banks, and the governments that backed them. In Spain they say "NO!" starting on May 15. Now in Greece, they say "NO!" And now here in Nederland the GVB workers also say "NO!"

By being involved with the GVB protest, we will also break down barriers between Dutch workers and Spanish and Greek workers. It will reveal the false stories by the government and the media. It will make clear that their struggle is our struggle; that they come from the same source – governments slashing social services to pay for the failed speculation of big banks.

To build our struggle, we must show all the connections between these seemingly separate struggles, and build up the links between them.

drukwerk - laat de rijken de crisis betalen

2011-06-01T22:25:00.000+02:00

What can protesters in Amsterdam learn from Spanish and Greek protests?

2011-05-31T21:08:00.029+02:00

(see highlighted section below if you have little time)

By Wjard van Leeuwen, using CWI reports

Amsterdam

After three decades of neoliberalism and now the imposition of vicious austerity measures, apparent stoic quietude in Europe has turned into a mass movements threatening capitalist governments in several countries. Spontaneous occupations and demonstrations, 100,000’s strong, have developed in Spain and quickly spreading to Greece, with solidarity protests in other European cities. In Spain there has been a continuous occupation of city squares since 15 May 2011, and in Greece since 25 May. On Sunday 29 May approximately 50-70,000 protestors were present Syntagma Square at any time, about 200,000 throughout the day. In Amsterdam, like many other European cities, hundreds of young workers and students, especially Spaniards and Greeks, have demonstrated everyday since 16 May!

The spark in Europe was lit in Spain (influenced by the movements in Egypt and Tunisia) where the official unemployment rate recently hit the Depression-like figures of 21.19% and 44.6% for young workers. On 15 May Spanish workers and students spontaneously occupied squares in several cities following demonstrations again the politics of austerity. The political elite has been shaken to the core, and the government suffering a heavy defeat in regional elections. A violent attempt by the state to clear the square in Barcelona failed as the number of protestors swelled to become larger than the initial occupation! The movement shows no signs of backing down, with a vote yesterday in Madrid to continue the occupation.

Whilst clear demands have been slow to emerge from ongoing discussion and debate in both Greece and Spain, it is crystal clear that demonstrators are protesting the establishment’s politics and corruption. In Spain, the mainstream political parties that paved the way for the economic crisis, and the local media that cheerled, were not welcomed at the demonstrations. Nor are the trade unions that are seen as a part of the problem.

The Experience in Greece

Like in Spain, the unwillingness to involve the trade unions and any political parties is very strong. This attitude stems from the strong rejection of mainstream politics. Mainstream politics is, of course, the problem! The CWI’s section in Greece, Xekinima, thinks that this attitude will develop in the course of struggle. Andros Payiatsos, a member of Xekinima, says that

‘We believe that, once this develops into a movement, the need to give it mass dimensions to make it effective will be obvious. And then the youth will have to appeal to the working class, to the trade unions. This will be an appeal mainly to the rank and file of the unions because the trade union leaders are hated and also to the rank and file of the left parties because of the hostility towards the left parties.’

Xekinima members are playing a role in the occupation coordinating committees in the key cities of Athens and Thessalonica. One of their central demands, both in the assemblies and in the material they are producing and circulating, is that they want the workers to come. Payiatsos says:

‘we want all the people who are on strike to finish their strikes in the squares and stay there. If the electricity workers have a 48-hour strike… after their demo we would like them to come to the square to both provide and receive support and solidarity.’

The speed of events in Greece is amazing. Movements have sprung up, but because they have no leadership by means of a programme and a strategy for their struggle, they don’t last long. The bus workers had strike activity for over three months. But they were defeated, sold-out by their leadership. There was the fantastic occupation of the council hall in Athens by workers on temporary contracts. After four weeks that was also sold out.

The developments of movements, such as non-payment of the road tolls, were characteristic of the first three months of this year. But they also died down because the mass parties of the left did not put their forces behind it.

Now the spontaneous occupation movement has arisen from below. Unfortunately, the KKE, the Greek Communist Party, has come out against it. Synaspismos, the other main left party, also fails to provide direction.

There have been many strikes in many different sectors, and nine general strikes up until now. The next one has been scheduled for 21 June. There is a continuous strike movement; young people can see the power of the working class.

At the same time they understand that this kind of strike activity is not sufficient to solve the problem. More is required. General strikes are called every two or three months. A more determined strike activity is needed, one that could paralyse the government and, as Xekinima put forward in occupation assemblies, bring down the government.

Although there is a lot of confusion people understand that the country is ruled by what everybody in Greece now calls ‘thieves and liars’. The slogan ‘they must go’ is widespread. Payiatsos says that ‘eight out of ten people in the street will agree.’

But this is not the same as understanding that to bring down the government requires organised struggle. A spontaneous movement like the one that is occupying the squares is not enough. It has to be well organised, and, importantly, linked to other sections of the working class. In Greece this means linking it with strike activity. It must also be linked to the demand to bring down the government and oppose any government formed by New Democracy, the traditional capitalist party. Xekinima also raise political demands: refusing to pay the debt and nationalisation of the banks. The only way out for Greek people is by breaking with capitalism.

Previously Xekinima called for the left parties to collaborate to bring down the government, when the combined left was receiving about 25-30% in the polls and the idea of the left taking power could be seen as realistic. Now, not only young people, but a big section of the working class is very unhappy with the left. In recent polls 45% said they would vote for no one if elections were held. This is unheard of in Greece where the abstention rate is normally around 20-25%.

But if the Pasok government falls, who will replace it? Xekinima argues that young people, the workers, and the activists can replace the present rulers. Democratic, representative committees of the movement, with support from big sections of the rank and file of the left (and even some sections of the leaderships) and the working class can provide the basis and the structures of a new power that will represent the working masses and replace the ‘thieves’ in parliament.

What can protestors in the North learn

Whilst there are clear differences in the development of the struggle in Amsterdam (for example) and Greece and Spain, there are many similarities. There are many, so far fragmented, struggles against austerity policies. For example, the ongoing series of strikes again the privatisation and gutting of the public transport networks in Amsterdam. Those workers have appealed for support. There have been mass demonstrations (20,000) by Dutch students in recent months, and there have been many protests by expatriate groups (such as the Mexicans) against elite policies in their countries. There are many more.

One of the jobs of activists on the ground is to point out the links between all these struggles – they all stem from government policies that favour capital and big-business profits, no matter what the social cost. The current wave of ‘austerity’ politics in Europe is nothing more than an attempt to protect the profits of the big banks that caused the crisis in the first place! All our struggles need to reinforce one another, and work together in unity. After all, it is clear that the interests of (finance) capital are looked after through strong organisation (think ECB, IMF, WB, G8, individual states etc.)!

Forging unity across constructed social barriers (race, job category, gender, nationality etc.) is the most effective way to combat the ‘blame game’ that the media and governments perpetuate, which so far has an echo because the alternative understanding has not been given voice. In the North of Europe it is a story of the 'lazy' South - but ordinary workers didn't rack up the debts! It is in daily experience, in struggle and in practical solidarity that workers and students learn their common plight.

A practical policy of working class unity and dialogue – developing links between individual struggles – will develop the momentum of the protests in the North, protect them from petering out and state (police) attempts to disperse them.

The Socialistisch Alternatief supports the struggles of Greek, Spanish and other workers and students. The CWI argue for a program (in Spanish) that does away with the capitalist system – and the establishment that supports it – that prioritises the profits of the few over needs of the many.
Keep up with events in Spain, Greece and Amsterdam.

Understanding Today's Crisis

2011-05-29T16:37:00.003+02:00

David Harvey provides a very good explanation of the crisis today:

See his site and also wikipedia's list of his works (including lots of great audio/video)

This is great little animation:

Capital: lifeblood of the economy

2011-05-27T01:06:00.013+02:00

Capital is the defining phenomenon of the economic system we live under. How does it work?

Basically the capitalist has money (M) with which they buy means of production (MP) and labour power (LP; someone's capacity to work for a period), which they combine with a particular technology (including organisational forms such as management) in a production process (PP) to produce a commodity (C), which - if successful - they then sell for the original amount of money plus some extra money (M + M'; this 'extra money' is a form of 'surplus value', which is then dealt out as profit, interest and rent).

The original (M) and a part of the new money (aM'; the rest, 1-a, is consumed) is then re-invested in a process 'usually' enforced by competition, and the same process starts again. In this sense capitalism is the production of capital itself, as opposed to particular goods or services.

That's it! From this very simple idea we can say a lot:

Note also that capital is not a particular thing - the neoclassicals say it is basically machines - but that it is a process, in which the form of capital is continually transformed.

Problems can arise at any one of these points. For example, in the 1970's one of the problems in advanced capitalist countries was that new sources of LP were running dry (meaning labourers had a comparitively high level of power). This problem was solved by political means, for example by paving the way for offshoring to Asia.

Today (2011) we face an aggregate/effective demand problem - the realisation of C as M+M' is not always successful because demand (especially final consumption) has fallen.

Note also that if successful, the continuous reinvestment of M' implies endless economic growth. Is this really feasable? Are there 'natural' limits?

__________________________

Here is a video of David Harvey explaining the above schema of the production of capital, during a lecture on Marx's method (especially Marx's Grundrisse and Capital).

The relevant section is "the second segment" from 20:09 to 44:55 (about 25 minutes). It moves quite quickly. Don't be put off - in terms of understanding the flow of capital, and therefore what the necessary conditions are for capitalism to survive, it is one of most useful things you can spend 25 minutes on!

If you are not familiar with Marx's explanation of capitalist economics much, it is best to stick with the "second segment" initially. (The rest is important, but requires background reading.)

__________________________

One thing that David Harvey doesn't spend much time (he takes it as known by his audience) is the question of where does profit come from? This has to do with the unique property of labour power (a commodity) - it can produce more value than it cost!

Workers (LP) do not receive the full amount of the value they create (in the production process). If someone is paid $100 a day, but the value they create is say $140, then the capitalist makes $40 (gross) profit. In this sense labour is exploited. This explained halfway a little video here.

SPANISH WORKERS PUT CLASS BACK ON THE AGENDA

2011-05-23T18:28:00.008+02:00

By Wjard van Leeuwen

About five hundred Spanish students, workers and international supporters spontaneously demonstrated yesterday (21 May 2011) in Amsterdam’s Dam Square, in solidarity with the massive (banned) demonstrations against unemployment and austerity-politics in Madrid, Barcelona and other cities in Spain. The high-spirited protests continued today (22 May) at the Spanish consulate and Dam Square, as the governing Socialist Party braces for heavy losses in local and regional elections (22 May). Protests will continue alongside those in Spain until at least 29 May.

Several hundred workers and students demonstrate in sympathy with Spanish protesters at Dam Square, 21 May 2011. Picture by Wjard van Leeuwen.

The protests in Spain, and sympathetic protests in European capitals, were spontaneously organised (largely through facebook) following an apparently stoic quietude as the government steadily undermined living standards. Whilst clear demands have not emerged from ongoing discussion and debate, what is clear is that demonstrators are protesting the establishment’s politics and corruption. The mainstream political parties that paved the way for the economic crisis, and the Spanish media that cheerled, were not welcomed at the demonstrations.

Puerta del Sol (BBC)

While mainstream economists now say the Spanish economy is no longer in recession – defined as two quarters of negative growth – the number of unemployed continues to skyrocket. Spain’s official unemployment rate recently hit 21.19%, and 44.6% for young workers, recalling Depression-era social catastrophes.[1] The number of jobless doubled in the year after the property bubble burst, when about two million people lost their jobs.[2] The prospect of a ‘jobless recovery’ hangs like a spectre over the southern Europe.

The Socialist Alternief (Nederland) supports the struggles of Spanish workers and students. We argue for a program (in Spanish) that does away with the capitalist system – and the establishment that supports it – that prioritises the profits of the few over needs of the many. See “what we stand for.”

There are also good analyses by the CWI on the spanish protests here. This article is also published in Dutch here.

To keep up with events in Nederland click here.

[1] http://www.guardian.co.uk/world/2011/may/21/spain-reveals-pain-cuts-unemployment

http://www.bbc.co.uk/news/world-europe-13496038

[2] http://news.bbc.co.uk/2/hi/business/8016364.stm

future posts

2011-05-23T16:51:00.009+02:00

I've come to realise this collection of ideas will take months to elaborate on. Ideas and contributions most welcome!

The Environment.

David Harvey and 3% growth forever (see the post on capital)
Planning green growth (2002) by the CWI's Pete Dickenson.

Great little book on approaches to our future on this planet

The role of theory: For what purpose and for whom?

Robert Cox is very good on the role of theory is (he describes what he does as critical theorist). His main work is Production, Power and World Order (1987).

Relationship between political economy and NCS

where do the eclectic models actually fit into a larger understanding of the economy (and society)?
Are they totally useless? Can we use them to understand the particular?
Kuhn's incommensurability thesis - different paradigms have trouble communicating (super confusing!) because of pretty fundamental differences [PK meth. articlewk 1]

Where does really inflation come from?

its certainly not from wages alone, though it is convenient to blame workers
fig. 1.2 glyn chapter 1?

Critique of particular neoclassical / synthesis economic models

What is exactly it that is wrong with models we are learning? How do we investigate these problems?
It all starts with assumptions....
post keynesian responses (direct engagement)

Socialists and Deficits: what do socialists say about defecits and debts?

marx doesn't say much!
surely something different from the neoliberal emphasis on sound balanced budgets!
the influence of Keynes, the interventionist state
local experiences on Yarra Council
how the ideology of neoliberalism actually helped cause the financial crisis, in the sense of moral hazard and the lack of 'market discipline' (role of risk premiums)
should Greece have defaulted, as Harvey has suggested?
why was it that the ECB allowed the bailout of Greece etc despite the explicit "no-bailout clause". compare to argentinas default - capital is now reinvesting (it is desperate for an outlet)

Why is a degree in neoclassical economics is (more than) useless.

2011-05-23T16:42:00.002+02:00

Why is neoclassical economics so useless?

I took a degree in economics to figure out what was going on the 2008+ financial crisis. If that is your sole aim, don't bother! (If anything it will confuse and disorient as your bombarded with theories and 'neat' maths models that don't really make sense anyway!)

For a quick preview, at watch the movie "Inside Job". Later on they interview an economist called Mishkin whose textbook we used. Totally corrupt!

Before I write more (later), just think about who all the theories about 'market making', deregulation and so forth have benefited.

Relation of economics to society

2011-05-23T16:06:00.000+02:00

Dialectical relation between 'society' and economy:

Marx's 1859 Preface of A Contribution to the Critique of Political Economy

Development of capitalism:

Marx and Engel's 1848 Communist Manifesto (and in PDF and zipped audio).

For the emergence of capital, read especially Chapter 1 - Bourgeois and Proletarians.

This blog

2011-05-23T15:59:00.002+02:00

The neo-classical / neo-classical synthesis taught to economics bachelors is plainly incapable of explaining the massive social and economic crisis visited upon working people by the Party of Wall St.

We need radically different conceptions to understand the problems of unemployment, environmental destruction and the crazy economic volatility we face today.

The basic idea of this blog is to serve as a suggested reading list (incl. a lot of audio and video) for people looking for better analysis, and a centralised source of foundational documents that can serve as a methodological guide. Hopefully it will string my thoughts together too. We'll see how it develops!

Short Comment on Krugman's Article on ECB, Austerity and the Confidence Fairy

2011-05-23T12:36:00.000+02:00

My macroeconomics teacher, a nice bloke, suggested we all read Krugman's article on the ECB's belief in the confidence fairy would fix Europe.

Krugman writes that "[o]n the other side, the E.C.B. is acting as if it is determined to provoke a financial crisis... If Greek banks collapse, that... could start financial dominoes falling across much of Europe. So what is the E.C.B. thinking?"

Refering to the idea that its all about market confidence, Krugman's "guess is that it’s just not willing to face up to the failure of its fantasies." Theory is always for someone, and for some purpose (that's R.W. Cox's catchy theoretical slogan).

Most surprisingly, it seems the ECB being run according to a particular set of interests! These men, unaware or otherwise - the effect is the same - act for - you guessed it - bondholders.

These guys most probably know that by killing demand they are undermining the entire European and world economy. The error goes much deeper. The system isn't being in the collective interest of capital, but finance capital. That's my guess.

In a crisis," after all, "assets return to their rightful owners" (David Harvey quoting Andrew Mellon, the US Treasury Secretary during the Great Crash of 1929 and one of America's richest men in his Enigma of Capital).

savings

2011-05-23T05:05:00.000+02:00

There is enormous confusion about savings, especially in relation to investment (think the 'loanable funds' approach) in mainstream economics (neoclassical / synthesis / monetarist / new classical / new keynesian).

Where does the fallacy that investment must be financed come from? Just from the everyday experience (where the role of credit is hidden)?

A Short History of Macroeconomics (for much needed course context!)

2011-05-23T00:03:00.000+02:00