Archive for the ‘World economy’ Category

by Michael Roberts

This year’s Historical Materialism conference in London seemed well attended and with younger participants.  HM covers all aspects of radical thought: philosophical, political, cultural, psychological and economic.  But it’s economics that this blog concentrates on and so my account of HM London will be similar.

Actually, there did not seem to be as many economic sessions as in previous years, so let me begin with the ones that I organised!  They were the two book launch sessions: one on the new book, The World in Crisis, edited by Guglielmo Carchedi and myself; and the second on my short book, Marx 200, that elaborates on Marx’s key economics ideas and their relevance in the 21st century, some 200 years after his birth and 150 years since he published Volume One of Capital.

In the session on The World in Crisis, I gave a general account of the various chapters that all aim at providing a global empirical analysis of Marx’s law of profitability, with the work of mostly young authors from Europe, Asia, North and South America (not Africa, unfortunately).

As the preface in the book says: “World in Crisis aims to provide empirical validity to the hypothesis that the cause of recurring and regular economic crises or slumps in output, investment and employment can be found ultimately in Marx’s law of the tendential fall in the rate of profit on capital.”  My power point presentation showed one overall result: that wherever you look at the data globally, there has been a secular fall in the rate of profit on capital; and in several chapters there is evidence that the causal driver of crises under capitalism is a fall in profitability and profits.

In the session, Tony Norfield presented his chapter on derivatives and capital markets.  Tony has just published his powerpoint presentation on his excellent blog site.  Tony traces the origin of the rise of derivatives from the 1990s to the instability of capital markets. Derivatives did not cause the global financial crash in 2008 but by extending the speculative boom in credit in the early 2000s, they helped spread the crash beyond the (more…)

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by Michael Roberts

Sweden has long been the poster child of the ‘mixed economy’, the social democrat state – where capitalism is ‘moulded’ to provide a welfare state, equality and decent working and living conditions for the majority. The 2018 general election result has put that story to bed.

In yesterday’s election, the Social Democrats, the supposed standard-bearer of the ‘mixed economy’, remained the largest party with just over 28% of the vote.  But this was its lowest share in an election since 1908.  The main pro-business party, the so-called Moderates, also lost votes, coming in with 19.7%.  Cutting through both these parties, who have alternated for decades in controlling government, was the rise of Sweden’s so-called Democrats (an oxymoron), an anti-immigrant party with neo-Nazi roots, which polled 17.7%.  The smaller parties of the centre-right and the left also gained – the Left party jumping to 8%.  The middle-of the road Green party was run over and nearly failed to gain the 4% necessary to enter parliament.  The two alliances of the social democracy and the pro-business parties are virtually tied with 40% of the vote each – leaving the Democrats with the balance of power in the new parliament.  Such is the impasse.

It was an illusion anyway about Sweden being the ‘third way’ between untrammelled free market capitalism and command economy autocratic Communism.  The great gains of the Swedish labour movement in the early 20th century have slowly been reversed.  And the post-war diversion to public services of some of the profits of the Swedish engineering and manufacturing (owned by a handful of families) (more…)

“In this way we are helped to maintain our social services at a level incomparably higher than that of any European country, or indeed of any country” – Churchill

by Tony Norfield

With the British ruling elites tearing themselves apart over foreign policy these days (regarding the European Union), I thought I would take a brief look back into happier times. Here are some choice quotations from major politicians and newspapers that stressed how much Britain’s position in the world produced big benefits.

First, Winston Churchill in April 1929. He is talking in Parliament about the City’s revenues, and its role as a global broker, as well as the big returns on British foreign investments:

“The income which we derive each year from commissions and services rendered to foreign countries is over £65,000,000, and, in addition, we have a steady revenue from foreign investments of close on £300,000,000 a year, 90 per cent of which is expressed in sterling. Upon this great influx there is levied, as a rule, the highest rates of taxation. In this way we are helped to maintain our social services at a level incomparably higher than that of any European country, or indeed of any country.”

Note that both kinds of revenue do not all come from the (more…)

by The Spark

Every day, Trump hogs the spot light.  He uses summits to attack US allies, like Canada and NATO.  He takes aim at women leaders, insulting British prime minister Theresa May and German chancellor Angela Merkel.  He walks in front of the elderly Queen of England, almost tripping her up.

Then he rubs it in.  He pretends to be best buddies with North Korea’s Kim Jong Un and Russia’s Vladimir Putin.

The news media goes crazy.  “This is not a normal president” and “We’ve never had a president like this before,” they say.

That’s music to Trump’s ears.  He is playing a game to keep his base behind him.  He doesn’t mind shocking the others to do that.  It reinforces his play to look ‘tough’.

Trump poses as the champion of the (more…)

A number of people who were engaged in the Imperialism study/discussion group initiated by this blog have recently been debating David Harvey and others on imperialism today (and in the past).  The debate has taken place on the site of the Review of African Political Economy.  For links to the key articles, see here.

The most recent contribution is by one of the Imperialism group participants based in New York. 

by Walter Daum

Esteban Mora begins his contribution to the roape.net discussion of the David Harvey-John Smith debate by asserting that the whole debate over who drains value from whom is misguided. While Smith says the West continues to drain the East and Harvey holds that the direction has been reversed, Mora believes that both claims rest on the ‘misconception’ arising from dependency theory that the imperialist North drains value from the imperialized South. [1]This, he says, is ‘not entirely accurate,’ and he goes on to make further claims which, as I see it, amount to arguing that imperialism as classically defined by Marxists does not exist – and for that matter never did.

Mora’s argument goes through several steps. He first points out that Northern and Southern capitalists both exploit the South, which is undeniably true. The rate of profit is higher in the South, he says, because of Southern industry’s less developed organic composition of capital, and both Northern and Southern capitalists benefit from it. But this reasoning is off-target. Mora overlooks the enormous super-exploitation of Southern labor (in fact, he never mentions any kind of exploitation), the main reason that profit rates from production in the South are higher. Moreover, the organic composition need not be much lower in the South; many Southern factories use up-to-date technology.

Second, Mora rejects the dependency-theory notion of a ‘correlative movement between rising profits and diminishing profits.’ It is not clear whether the rising profits are meant to be those produced in the North or those captured by Northern capitalists wherever produced, and likewise for the diminishing profits of the South. But since he is aiming to refute the ‘drain’ of profits, we have to assume that he is denying that Northern capitalists capture greater profits than Southern capitalists. On this, John Smith has shown in his book and in this online discussion that, Apple, for example, makes a much higher rate of profit than the contractors who produce its devices in China. And I gave evidence in my contribution to the debate that ‘the surplus-value flow from the U.S. to China does not match that extracted from China by the West.’

Mora seems to. . . .

Full: Again, Is imperialism still imperialism

by The Spark

Since the spring (NZ autumn – Redline), the Trump administration has imposed a wave of tariffs on 1,102 imported goods, from aluminum and steel, that is, the building blocks of basic industry, to consumer items like washing machines, solar panels, and LED lighting.

Do these tariffs signal a real change in U.S. trade policy? Or are they one more instance of Trump grandstanding, playing to the chauvinism of his America First voting base?

For all the furore Trump’s rhetoric has produced, it is much ado about little. Even if the tariffs that Trump has announced take full effect – which is doubtful – they will hit only a very small portion of the roughly three trillion dollars a year in imports into the U.S. As Stephen Gallagher, managing director of Société Générale, explained, “… right now it’s more of a temper tantrum on trade, as opposed to a real war” (Wall Street Journal, June 19) although, as Gallagher points out, there is always the risk that it could develop into something much bigger.

But Trump’s tariffs have already produced a (more…)

global_perspectiverThe following interview was first published in English on leftwingbooks.net, see here.

This is the English version of an interview with Torkil Lauesen that Gabriel Kuhn conducted for the German daily junge Welt. Torkil Lauesen is a Danish anti-imperialist whose book The Global Perspective: Reflections on Imperialism and Resistance has recently been published by Kersplebedeb. In 1991, Lauesen was sentenced to ten years in prison for his involvement in the so-called Blekingegade Group whose activities have been featured in the PM/Kersplebedeb release Turning Money into Rebellion: The Unlikely Story of Denmark’s Revolutionary Bank Robbers. (The book can be bought here)

In 1991, you were sentenced to ten years in prison because of your anti-imperialist activities. Now, 25 years later, you have written a book titled The Global Perspective: Reflections on Imperialism and Resistance. Has nothing changed?

Everything has changed in order to stay the same: The industrialization of the Global South and the global chains of production have intensified imperialism. Superprofits for capital have increased, while the prices for consumer goods in the Global North have decreased. U.S. hegemony has declined. We now live in a multipolar world with new powers emerging. So-called real socialism no longer exists, and national liberation movements have all but disappeared.

At the end of the 1980s, antiimperialism pretty much vanished from the left’s radar. Why?

National liberation struggles in the Global South subsided and neoliberalism ushered in a golden capitalist era. Furthermore, the talk about globalization concealed the ongoing reality of imperialism.

Was there no globalization?

Of course there have been drastic changes in capitalism in the last thirty years: innovations in transport and communications have altered the entire system of production and distribution. But very few people have (more…)