Posts Tagged ‘economics’

Marx and Darwin: Two great revolutionary thinkers of the nineteenth century

November 10, 2009

Part 1

By Chris Talbot, WSWS.og, June 17, 2009

This is the first of a three-part series comprising a lecture by WSWS correspondent Chris Talbot to meetings of the International Students for Social Equality in Britain. Part 2 was posted on June 18 and Part 3 on June 19.

We have organised these meetings of the International Students for Social Equality in honour of Charles Darwin from a different standpoint from the many other bicentenary events. We want to bring out the connection between Darwin and that other great thinker of the mid-19th century, Karl Marx.

Charles Darwin

The importance of Marx hits you when you take in the events of the last few months. We are now in a world economic crisis comparable to, if not more severe than, that of the 1930s, which will have a major effect on all of our futures. Current economic theory completely failed to predict this crisis. The economists cannot explain how it happened and have no answer to it [1]. In contrast, Karl Marx spent much of his life developing an economic analysis that explains the inherent instability of capitalism and provides a scientific basis for the development of the socialist working class movement.

Continues >>

Socialism has failed. Now capitalism is bankrupt. So what comes next?

April 11, 2009

Whatever ideological logo we adopt, the shift from free market to public action needs to be bigger than politicians grasp

The 20th century is well behind us, but we have not yet learned to live in the 21st, or at least to think in a way that fits it. That should not be as difficult as it seems, because the basic idea that dominated economics and politics in the last century has patently disappeared down the plughole of history. This was the way of thinking about modern industrial economies, or for that matter any economies, in terms of two mutually exclusive opposites: capitalism or socialism.

We have lived through two practical attempts to realise these in their pure form: the centrally state-planned economies of the Soviet type and the totally unrestricted and uncontrolled free-market capitalist economy. The first broke down in the 1980s, and the European communist political systems with it. The second is breaking down before our eyes in the greatest crisis of global capitalism since the 1930s. In some ways it is a greater crisis than in the 1930s, because the globalisation of the economy was not then as far advanced as it is today, and the crisis did not affect the planned economy of the Soviet Union. We don’t yet know how grave and lasting the consequences of the present world crisis will be, but they certainly mark the end of the sort of free-market capitalism that captured the world and its governments in the years since Margaret Thatcher and President Reagan.

Impotence therefore faces both those who believe in what amounts to a pure, stateless, market capitalism, a sort of international bourgeois anarchism, and those who believe in a planned socialism uncontaminated by private profit-seeking. Both are bankrupt. The future, like the present and the past, belongs to mixed economies in which public and private are braided together in one way or another. But how? That is the problem for everybody today, but especially for people on the left.

Continued >>

How the Media Sold Their Souls to Wall Street

October 3, 2008

by Josh Silver

If you are like me, the pundits, and 99.9% of the American public, you really don’t know much about economics. And despite Monday’s refreshing moment of rebellion in the Congress, in all likelihood the House and Senate will pass a modified version of the $700 billion handout this week to fat cat Wall Street financiers.

The likely result, according to Nobel economist Joseph Stiglitz: “The unemployment rate will still increase, growth will remain anemic, house prices will continue to fall, the number of houses in foreclosure will continue to rise, credit will be harder to get, states and localities will remain in a fiscal crisis, and there will be cutbacks in basic public services. …. Our living standards in the future will be lower than they otherwise would have been. ”

Here’s the problem: None of us really know that the hell is going on, and what the largest financial bailout in the history of our nation would actually achieve. Based on McCain and Obama’s hasty support of the bailout, it would seem they are both too far under the thumb of Wall Street to look at viable alternatives to an unprecedented handout to the same reckless bankers who got us into this mess.

And like they did in the run-up to war in Iraq and the passage of the Patriot Act, the media are compounding the problem rather than helping it. While TV devotes 24/7 coverage to pretending that mudslinging Democrats and Republicans represent the full range of debate, while right-wing radio hosts scream socialism, and while pundits like Thomas Friedman implore Congress “to give them the capital and the flexibility to put out this fire,” the American people are getting virtually no hard economic analysis about what the bailout would achieve or what the range of options are.

Why aren’t Luc Laeven and Fabian Valencia on television right now? They just submitted a comprehensive report to the International Monetary Fund after studying 42 banking crises over the past 37 years. Their conclusion: Bailouts often do not work, they often result in more bad practices, and they distort economies by transferring wealth from taxpayers to bankers and their customers.

Why hasn’t economist Dean Baker been invited onto a single television program in the past week ? He is one of the guys who actually predicted the current crisis. He wrote this week: “There is no way that the failure to do a bailout will lead to more than a very brief failure of the financial system. The worst case scenario is that we have an extremely scary day in which the markets freeze for a few hours. Then the Fed steps in and takes over the major banks. The system of payments continues to operate exactly as before, but the bank executives are out of their jobs and the bank shareholders have likely lost most of their money. In other words, the banks have a gun pointed to their heads and are threatening to pull the trigger unless we hand them $700 billion.”

Why isn’t New York University economist Nouriel Roubini all over the news right now? He says the claim that “spending $700 billion of public money is the best way to recapitalize banks has absolutely no factual basis or justification. This way of recapitalizing financial institutions is a total rip-off that will mostly benefit – at a huge expense for the U.S. taxpayer – the shareholders and even unsecured creditors of the banks. ….The pockets of reckless bankers and investors (will) have been made fatter under the fake argument that bailing out Wall Street was necessary to rescue Main Street from a severe recession.”

Roubini continues, “Instead, the restoration of the financial health of distressed financial firms could have been achieved with a cheaper and better use of public money. It is pathetic that Congress did not consult any of the many professional economists that have presented alternative plans that were more fair and efficient and less costly ways to resolve this crisis. … and it is a scandal that even Congressional Democrats have fallen for this Treasury scam that does little to resolve the debt burden of millions of distressed home owners.”

But turn on your television – the place where more than 60% of Americans get their primary news – turn on your radio, or open your local newspaper, and you’re not going to see what these top economists are saying. It’s a McCain quote, an Obama sound byte, and the same pundits who have proven their incompetence over and over. The result is an American public that is fundamentally uninformed about the issues that matter most – like economics, health care, and war – and over-informed about those that matter least: sports, celebrity, the latest campaign ad, and horserace analysis of elections.

We have no reason to believe that the press — and along with it, most politicians — will ask the tough questions, expand the range of debate, and bring the facts to the American people. But until they do, our economy – and our democracy — will continue its race to the bottom.

Josh Silver is the Executive Director of Free Press a national, nonpartisan organization that he co-founded with Robert McChesney and John Nichols in 2002 to engage citizens in media policy debates and create a more democratic and diverse media system.

%d bloggers like this: